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TRUST INDENTURE
DATED AS OF THE 20TH DAY OF JULY, 2004
BETWEEN
ALGONQUIN POWER INCOME FUND
AND
CIBC MELLON TRUST COMPANY
PROVIDING FOR THE ISSUE OF DEBENTURES
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TABLE OF CONTENTS
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ARTICLE 1 INTERPRETATION .............................................. 1
1.1 Definitions ................................................. 1
1.2 Meaning of "Outstanding" .................................... 9
1.3 Interpretation .............................................. 10
1.4 Headings Etc ................................................ 10
1.5 Day not a Business Day ...................................... 10
1.6 Applicable Law .............................................. 10
1.7 Monetary References ......................................... 11
1.8 Invalidity, Etc ............................................. 11
1.9 Language .................................................... 11
1.10 Successors and Assigns ...................................... 11
1.11 Benefits of Indenture ....................................... 11
1.12 References to Acts of the Trust ............................. 11
1.13 No Recourse ................................................. 12
1.14 Schedules ................................................... 12
ARTICLE 2 THE DEBENTURES .............................................. 12
2.1 Limit of Debentures ......................................... 12
2.2 Terms of Debentures of any Series ........................... 12
2.3 Form of Debentures .......................................... 14
2.4 Form and Terms of Initial Debentures ........................ 15
2.5 Certification and Delivery of Additional Debentures ......... 21
2.6 Issue of Global Debentures .................................. 23
2.7 Execution of Debentures ..................................... 23
2.8 Certification ............................................... 24
2.9 Interim Debentures or Certificates .......................... 24
2.10 Mutilation, Loss, Theft or Destruction ...................... 25
2.11 Concerning Interest ......................................... 25
2.12 Debentures to Rank Pari Passu ............................... 26
2.13 Payments of Amounts Due on Maturity ......................... 26
2.14 U.S. 1993 Act Legend on the Debentures ...................... 26
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2.15 Payment of Interest ......................................... 28
ARTICLE 3 REGISTRATION, TRANSFER, EXCHANGE AND OWNERSHIP .............. 29
3.1 Fully Registered Debentures ................................. 29
3.2 Global Debentures ........................................... 29
3.3 Transferee Entitled to Registration ......................... 31
3.4 No Notice of Trusts ......................................... 32
3.5 Registers Open for Inspection ............................... 32
3.6 Exchanges of Debentures ..................................... 32
3.7 Closing of Registers ........................................ 32
3.8 Charges for Registration, Transfer and Exchange ............. 33
3.9 Ownership of Debentures ..................................... 33
ARTICLE 4 REDEMPTION AND PURCHASE OF DEBENTURES ....................... 34
4.1 Applicability of Article .................................... 34
4.2 Partial Redemption .......................................... 34
4.3 Notice of Redemption ........................................ 35
4.4 Debentures Due on Redemption Dates .......................... 36
4.5 Deposit of Redemption Moneys or Trust Units ................. 36
4.6 Right to Repay Redemption Price in Trust Units .............. 36
4.7 Failure to Surrender Debentures Called for Redemption ....... 40
4.8 Cancellation of Debentures Redeemed ......................... 40
4.9 Purchase of Debentures by the Trust ......................... 40
4.10 Right to Repay Principal Amount in Trust Units .............. 41
4.11 Right to Pay All Amounts in Trust Units ..................... 44
ARTICLE 5 SUBORDINATION OF DEBENTURES ................................. 44
5.1 Applicability of Article .................................... 44
5.2 Order of Payment ............................................ 45
5.3 Subrogation to Rights of Holders of Senior Indebtedness ..... 46
5.4 Obligation to Pay Not Impaired .............................. 46
5.5 No Payment if Senior Indebtedness in Default ................ 47
5.6 Payment on Debentures Permitted ............................. 47
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5.7 Confirmation of Subordination ............................... 48
5.8 Knowledge of Trustee ........................................ 48
5.9 Trustee May Hold Senior Indebtedness ........................ 48
5.10 Rights of Holders of Senior Indebtedness Not Impaired ....... 48
5.11 Altering the Senior Indebtedness ............................ 49
5.12 Additional Indebtedness ..................................... 49
5.13 Right of Debentureholder to Convert Not Impaired ............ 49
ARTICLE 6 CONVERSION OF DEBENTURES .................................... 49
6.1 Applicability of Article .................................... 49
6.2 Notice of Expiry of Conversion Privilege .................... 50
6.3 Revival of Right to Convert ................................. 50
6.4 Manner of Exercise of Right to Convert ...................... 50
6.5 Adjustment of Conversion Price .............................. 51
6.6 No Requirement to Issue Fractional Units .................... 56
6.7 Trust to Reserve Units ...................................... 56
6.8 Cancellation of Converted Debentures ........................ 56
6.9 Certificate as to Adjustment ................................ 56
6.10 Notice of Special Matters ................................... 57
6.11 Protection of Trustee ....................................... 57
6.12 U.S. 1933 Act Legend on Trust Units ......................... 57
ARTICLE 7 LIMITATIONS ON OWNERSHIP .................................... 58
7.1 Limitations on Ownership .................................... 58
7.2 Prohibition Against Ownership by Certain U.S.
Retirement Plans ......................................... 59
ARTICLE 8 COVENANTS OF THE TRUST ...................................... 60
8.1 To Pay Principal and Interest ............................... 60
8.2 To Pay Trustee's Remuneration ............................... 60
8.3 To Give Notice of Default ................................... 61
8.4 Preservation of Existence, etc .............................. 61
8.5 Additional Covenants ........................................ 61
8.6 Reporting Requirements ...................................... 62
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8.7 No Distributions on Trust Units if Event of Default ......... 62
8.8 Performance of Covenants of Trustee ......................... 62
ARTICLE 9 DEFAULT ..................................................... 63
9.1 Events of Default ........................................... 63
9.2 Notice of Events of Default ................................. 64
9.3 Waiver of Default ........................................... 64
9.4 Waiver of Declaration ....................................... 65
9.5 Enforcement by the Trustee .................................. 66
9.6 No Suits by Debentureholders ................................ 67
9.7 Application of Moneys by Trustee ............................ 68
9.8 Notice of Payment by Trustee ................................ 69
9.9 Trustee May Demand Production of Debentures ................. 69
9.10 Remedies Cumulative ......................................... 69
9.11 Judgement Against the Trust ................................. 69
9.12 Immunity of Trustees and Others ............................. 69
9.13 Control by Debentureholders ................................. 70
9.14 Rights of Debentureholders to Receive Payment ............... 70
9.15 Delay or Omission Not Waiver ................................ 70
ARTICLE 10 SATISFACTION AND DISCHARGE .................................. 70
10.1 Cancellation and Destruction ................................ 70
10.2 Non-Presentation of Debentures .............................. 71
10.3 Repayment of Unclaimed Moneys or Trust Units ................ 71
10.4 Discharge ................................................... 71
10.5 Satisfaction ................................................ 72
10.6 Continuance of Rights, Duties and Obligations ............... 74
ARTICLE 11 TRUST UNIT INTEREST PAYMENT ELECTION ........................ 74
11.1 Trust Unit Interest Payment Election ........................ 74
ARTICLE 12 SUCCESSORS .................................................. 77
12.1 Restrictions on Amalgamation, Merger and Sale of
Certain Assets, etc ...................................... 77
12.2 Vesting of Powers in Successor .............................. 78
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TABLE OF CONTENTS
(continued)
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ARTICLE 13 COMPULSORY ACQUISITION ...................................... 78
13.1 Definitions ................................................. 78
13.2 Offer for Debentures ........................................ 79
13.3 Offeror's Notice to Dissenting Debentureholders ............. 79
13.4 Delivery of Debenture(s) .................................... 80
13.5 Payment of Consideration to Trustee ......................... 80
13.6 Consideration to be held in Trust ........................... 80
13.7 Completion of Transfer of Debentures to Offeror ............. 80
13.8 Communication of Offer to Trust ............................. 81
ARTICLE 14 MEETINGS OF DEBENTUREHOLDERS ................................ 81
14.1 Right to Convene Meeting .................................... 81
14.2 Notice of Meetings .......................................... 81
14.3 Chair ....................................................... 83
14.4 Quorum ...................................................... 83
14.5 Power to Adjourn ............................................ 84
14.6 Show of Hands ............................................... 84
14.7 Poll ........................................................ 84
14.8 Voting ...................................................... 84
14.9 Proxies ..................................................... 85
14.10 Persons Entitled to Attend Meetings ......................... 85
14.11 Powers Exercisable by Extraordinary Resolution .............. 86
14.12 Meaning of "Extraordinary Resolution" ....................... 88
14.13 Powers Cumulative ........................................... 89
14.14 Minutes ..................................................... 89
14.15 Instruments in Writing ...................................... 89
14.16 Binding Effect of Resolutions ............................... 89
14.17 Evidence of Rights Of Debentureholders ...................... 90
14.18 Concerning Serial Meetings .................................. 90
ARTICLE 15 NOTICES ..................................................... 90
15.1 Notice to Trust and Trustee ................................. 90
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15.2 Notice to Debentureholders .................................. 91
15.3 Mail Service Interruption ................................... 92
ARTICLE 16 CONCERNING THE TRUSTEE ...................................... 92
16.1 No Conflict of Interest ..................................... 92
16.2 Replacement of Trustee ...................................... 92
16.3 Duties of Trustee ........................................... 93
16.4 Reliance Upon Declarations, Opinions, etc ................... 93
16.5 Evidence and Authority to Trustee, Opinions, etc ............ 93
16.6 Officer's Certificates Evidence ............................. 95
16.7 Experts, Advisers and Agents ................................ 95
16.8 Trustee May Deal in Debentures .............................. 95
16.9 Investment of Moneys Held by Trustee ........................ 95
16.10 Trustee Not Ordinarily Bound ................................ 96
16.11 Trustee Not Required to Give Security ....................... 97
16.12 Trustee Not Bound to Act on Trust's Request ................. 97
16.13 Conditions Precedent to Trustee's Obligations to Act
Hereunder ................................................ 97
16.14 Authority to Carry on Business .............................. 98
16.15 Compensation and Indemnity .................................. 98
16.16 Acceptance of Trust ......................................... 99
16.17 Assignment and Enurement .................................... 99
ARTICLE 17 SUPPLEMENTAL INDENTURES ..................................... 99
17.1 Supplemental Indentures ..................................... 99
ARTICLE 18 EXECUTION AND FORMAL DATE ................................... 100
18.1 Execution ................................................... 100
18.2 Formal Date ................................................. 100
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THIS INDENTURE made as of the 20th day of July, 2004.
BETWEEN:
ALGONQUIN POWER INCOME FUND, a trust established under the laws of the
Province of Ontario
(hereinafter called the "TRUST")
AND
CIBC MELLON TRUST COMPANY, a trust company authorized to carry on
business in all Provinces of Canada
(hereinafter called the "TRUSTEE")
WITNESSETH THAT:
WHEREAS the Trust deems it necessary for its investment purposes to
create and issue the Debentures to be created and issued in the manner
hereinafter appearing;
AND WHEREAS the Trust, under the laws relating thereto, is duly
authorized to create and issue the Debentures to be issued as herein provided;
AND WHEREAS, when certified by the Trustee and issued as provided in
this Indenture, all necessary steps in relation to the Trust have been duly
enacted, passed and/or confirmed and other proceedings taken and conditions
complied with to make the creation and issue of the Debentures proposed to be
issued hereunder legal, valid and binding on the Trust in accordance with the
laws relating to the Trust;
AND WHEREAS the foregoing recitals are made as representations and
statements of fact by the Trust and not by the Trustee:
NOW THEREFORE it is hereby covenanted, agreed and declared as follows:
ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS
In this Indenture and in the Debentures, unless there is something in
the subject matter or context inconsistent therewith, the expressions following
shall have the following meanings, namely:
"90% REDEMPTION RIGHT" has the meaning ascribed thereto in Section
2.4(i)(iv);
"1933 ACT" means the United States Securities Act of 1933, as amended;
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"ADDITIONAL DEBENTURES" means Debentures of any one or more series, other
than the first series of Debentures, being the Initial Debentures, issued
under this Indenture;
"AFFILIATE" means, in respect of any Person, any other Person that is
affiliated with such Person for the purposes of the Securities Act
(Ontario), as amended from time to time;
"APPLICABLE SECURITIES LEGISLATION" means applicable securities laws
(including rules, regulations, policies and instruments) in each of the
Provinces of Canada;
"AUDITORS OF THE TRUST" means an independent firm of chartered accountants
duly appointed as auditors of the Trust;
"AUTHORIZED INVESTMENTS" has the meaning set forth in Section 16.9;
"BENEFICIAL HOLDER" means any Person who holds a beneficial interest in a
Global Debenture as shown on the books of the Depositary or a Depositary
Participant;
"BOARD OF DIRECTORS" means the board of directors of the Manager unless and
until the trustees of the Trust revoke the duties of the Manager hereunder
in which case it means the trustees of the Trust;
"BUSINESS DAY" means any day other than a Saturday, Sunday or holiday in
Toronto, Ontario or any other day that the Trustee in Toronto, Ontario is
not generally open for business;
"CHANGE OF CONTROL" means the acquisition by any Person, or group of
Persons acting jointly or in concert, of voting control or direction of an
aggregate of 66 2/3% or more of the outstanding Trust Units, inclusive of
securities convertible into or carrying the right to acquire Trust Units;
"CHANGE OF CONTROL NOTICE" has the meaning ascribed thereto in Section
2.4(i)(ii);
"CONVERSION PRICE" means the dollar amount for which each Trust Unit may be
issued from time to time upon the conversion of Debentures or any series of
Debentures which are by their terms convertible in accordance with the
provisions of Article 6, and in the case of the Initial Debentures as
defined in Section 2.4(e);
"COUNSEL" means a barrister or solicitor or firm of barristers or
solicitors retained or employed by the Trustee or retained or employed by
the Trust and acceptable to the Trustee;
"CURRENT MARKET PRICE" means the weighted average trading price per Trust
Unit for 20 consecutive trading days ending on the fifth trading day
preceding the date of determination on the TSX (or, if the Trust Units are
not listed thereon, on such stock exchange on which the Trust Units are
listed as may be selected for such purpose by the Board of Directors on
behalf of the Trust, or if the Trust Units are not listed on any stock
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exchange, then on the over-the-counter market; provided further that if the
Trust Units are not then listed on any stock exchange or traded on any
over-the-counter market, the Current Market Price shall be the fair market
value of the Trust Units as at such date as determined by an independent
nationally recognized investment dealer selected by the Trust or Manager on
behalf of the Trust). The weighted average price shall be determined by
dividing the aggregate sale price of all Trust Units sold on the said
exchange or market, as the case may be, during the said 20 consecutive
trading days by the total number of Trust Units so sold during such period;
"DATE OF CONVERSION" has the meaning ascribed thereto in Section 6.4(b);
"DEBENTUREHOLDERS" means the Persons for the time being entered in the
register for Debentures as registered holders of Debentures or any
transferees of such Persons by endorsement or delivery;
"DEBENTURES" means the debentures, notes or other evidence of indebtedness
of the Trust issued and certified hereunder, or deemed to be issued and
certified hereunder, including, without limitation, the Initial Debentures,
and for the time being outstanding, whether in definitive or interim form;
"DEBT ACCOUNT" means an account or accounts required to be established by
the Trust (and which shall be maintained by and subject to the control of
the Trustee) for each series of Debentures pursuant to and in accordance
with this Indenture;
"DEEMED INDEMNITY" has the meaning ascribed thereto in Section 7.2;
"DEEMED YEAR" has the meaning ascribed thereto in Section 2.1l(b);
"DEPOSITARY" means, with respect to the Debentures of any series issuable
or issued in the form of one or more Global Debentures, the Person
designated as Depositary by the Trust pursuant to Section 3.2 until a
successor Depositary shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter "DEPOSITARY" shall mean each
Person who is then a Depositary hereunder, and if at any time there is more
than one such Person, "DEPOSITARY" as used with respect to the Debentures
of any series shall mean each Depositary with respect to the Global
Debentures of such series;
"DEPOSITARY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time, a Depositary
effects book entry for a Global Debenture deposited with the Depositary;
"DESIGNATED OFFICE" means the principal office of the Trustee in each of
Toronto, Ontario, Montreal, Quebec or Calgary, Alberta;
"ESPECIALLY AFFECTED SERIES" has the meaning ascribed thereto in Section
14.2(b)(i);
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"ERISA" means the United States Employee Retirement & Security Act of 1974,
as amended, or any successor statute;
"EVENT OF DEFAULT" has the meaning ascribed thereto in Section 9.1;
"EXTRAORDINARY RESOLUTION" has the meaning ascribed thereto in Sections
14.12 and 14.15;
"FREELY TRADEABLE" means, in respect of trust units of any class in the
capital of any trust or shares of any class in the capital of any
corporation, trust units or shares, as the case may be, which (i) are
issuable without the necessity of filing a prospectus or any other similar
offering document (other than such prospectus or similar offering document
that has already been filed) under Applicable Securities Legislation and
such issue does not constitute a distribution (other than a distribution
already qualified by prospectus or similar offering document) under
Applicable Securities Legislation; and (ii) can be traded by the holder
thereof without any restriction under Applicable Securities Legislation,
such as hold periods, except in the case of a distribution by a control
person (as defined in the Applicable Securities Legislation);
"FULLY REGISTERED DEBENTURES" means Debentures registered as to both
principal and interest;
"GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" means generally accepted
accounting principles from time to time approved by the Canadian Institute
of Chartered Accountants;
"GLOBAL DEBENTURE" means a Debenture that is issued to and registered in
the name of the Depositary, or its nominee, pursuant to Section 2.6 for
purposes of being held by or on behalf of the Depositary as custodian for
participants in the Depositary's book-entry only registration system;
"GOVERNMENT OBLIGATIONS" means securities issued or guaranteed by the
Government of Canada or any province thereof;
"INITIAL DEBENTURES" means the Debentures designated as "6,65% Convertible
Unsecured Subordinated Debentures" and defined in Section 2.4;
"INTEREST OBLIGATION" means the obligation of the Trust to pay interest on
the Debentures, as and when the same becomes due;
"INTEREST PAYMENT DATE" means a date specified in a Debenture as the date
on which an instalment of interest on such Debenture shall become due and
payable;
"LEGENDED DEBENTURES" means Debentures bearing the legend provided for in
Section 2.14(a);
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"MANAGER" means Algonquin Power Management Inc. and its successors and
assigns;
"MATURITY DATE" has the meaning ascribed thereto in Section 4.10;
"MATURITY NOTICE" has the meaning ascribed thereto in Section 2.4(f);
"OBCA" has the meaning set forth in Section 16.9;
"OFFICER'S CERTIFICATE" means a certificate of the Trust signed by any one
authorized officer or trustee of the Trust in his capacity as officer or
trustee of the Trust, or by any one authorized officer or director of the
Manager on behalf of the Trust in his capacity as an officer or director of
the Manager, as the case may be, and not in his personal capacity;
"PERIODIC OFFERING" means an offering of Debentures of a series from time
to time, the specific terms of which Debentures, including, without
limitation, the rate or rates of interest, if any, thereon, the stated
maturity or maturities thereof, conversion rates, currency and the
redemption provisions, if any, with respect thereto, are to be determined
by the Trust upon the issuance of such Debentures from time to time;
"PERSON" includes an individual, corporation, company, partnership, joint
venture, association, trust, trustee, unincorporated organization or
government or any agency or political subdivision thereof;
"PROPERTY ACCOUNT" means a segregated deposit account with a financial
institution referred to in Section 16.9;
"PUT DATE" has the meaning ascribed thereto in Section 2.4(i)(i);
"PUT PRICE" has the meaning ascribed thereto in Section 2.4(i)(i);
"PUT RIGHT" has the meaning ascribed thereto in Section 2.4(i)(i);
"REDEMPTION DATE" has the meaning ascribed thereto in Section 4.3;
"REDEMPTION NOTICE" has the meaning ascribed thereto in Section 4.3;
"REDEMPTION PRICE" means, in respect of a Debenture, the amount, excluding
interest, payable on the Redemption Date fixed for such Debenture, which
amount may be payable by the issuance of Freely Tradeable Trust Units as
provided for in Section 4.6 and, in the case of the Initial Debentures, as
provided for in Section 2.4(c);
"REGULATION S" means Regulation S adopted by the United States Securities
and Exchange Commission under the 1933 Act;
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"SENIOR CREDITOR" means a holder or holders of Senior Indebtedness and
includes any representative or representatives or trustee or trustees of
any such holder or holders;
"SENIOR INDEBTEDNESS" shall mean all indebtedness of the Trust (other than
the Initial Debentures) (whether outstanding on the date of this Indenture
or thereafter created, incurred, assumed or guaranteed) and including, for
greater certainty, claims of trade creditors of the Trust, which by the
terms of the instrument creating or evidencing such indebtedness is not
expressed to be pari passu with or subordinate in right of payment to the
Debentures;
"SENIOR SECURITY" means all mortgages, liens, pledges, charges (whether
fixed or floating), security interests or other similar encumbrances,
contingent or absolute, held by or on behalf of any Senior Creditor and
securing any Senior Indebtedness;
"SERIAL MEETING" has the meaning ascribed thereto in Section 14.2(b)(i);
"SUBORDINATED DEBENTURE LIABILITIES" has the meaning ascribed thereto in
Section 5.1;
"SUBSIDIARY" has the meaning ascribed thereto in the Securities Act
(Ontario), R.S.O. 1990, c. S.5, as the same may be amended from time to
time, except that "COMPANY" and "COMPANIES" as such words are used in the
Securities Act (Ontario) shall be read to mean "ENTITY" or "ENTITIES";
"SUCCESSOR" has the meaning ascribed thereto in Section 12.1;
"THIS INDENTURE", "THIS TRUST INDENTURE", "HERETO", "HEREIN", "HEREBY",
"HEREUNDER", "HEREOF" and similar expressions refer to this Indenture and
not to any particular Article, Section, subsection, clause, subdivision or
other portion hereof and include any and every instrument supplemental or
ancillary hereto;
"TIME OF EXPIRY" means the time of expiry of certain rights with respect to
the conversion of Debentures under Article 6, such Time of Expiry to be set
forth for each series of Debentures which by their terms are to be
convertible;
"TOTAL PUT PRICE" has the meaning ascribed thereto in Section 2.4(i)(i)
"TRADING DAY" means, with respect to the TSX or other market for
securities, any day on which such exchange or market is open for trading or
quotation;
"TRANSFER AGENT" has the meaning ascribed thereto in Section 7.1;
"TRUST" means Algonquin Power Income Fund and includes any successor to or
of the Trust which shall have complied with the provisions of Article 12;
"TRUSTEE" means CIBC Mellon Trust Company and includes any successor or
successors or any other trustee subsequently appointed pursuant to Section
16.2;
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"TRUSTEES" means the trustees of the Trust for the time being and reference
to action "BY THE TRUSTEES" means action by the trustees of the Trust as a
board;
"TRUST UNITS" means trust units of the Trust, as such trust units are
constituted on the date of execution and delivery of this Indenture and,
where the context requires, includes units of the Trust issuable upon the
exchange of exchangeable securities issued by the Trust; provided that in
the event of a change or a subdivision, revision, reduction, combination or
consolidation thereof, any reclassification, capital reorganization,
consolidation, amalgamation, arrangement, merger, sale or conveyance or
liquidation, dissolution or winding-up, or such successive changes,
subdivisions, redivisions, reductions, combinations or consolidations,
reclassifications, capital reorganizations, consolidations, amalgamations,
arrangements, mergers, sales or conveyances or liquidations, dissolutions
or windings-up, then, subject to adjustments, if any, having been made in
accordance with the provisions of Section 6.5, "TRUST UNITS" shall mean the
units or other securities or property resulting from such change,
subdivision, redivision, reduction, combination or consolidation or
reclassification. capital reorganization, consolidation, amalgamation,
arrangement, merger, sale or conveyance or liquidation, dissolution or
winding-up;
"TRUST UNIT BID REQUEST" means a request for bids to purchase Trust Units
(to be issued by the Trust on the Trust Unit Delivery Date) made by the
agent of the Trust in accordance with the Trust Unit Interest Payment
Election Notice and which shall make the acceptance of any bid conditional
upon the acceptance of sufficient bids to result in aggregate proceeds from
such issue and sale of Trust Units which, together with the cash payments
by the Trust, if any, equal the Interest Obligation;
"TRUST UNIT DELIVERY DATE" means a date, not more than 90 days and not less
than one Business Day prior to the applicable Interest Payment Date, upon
which Trust Units are issued by the Trust and delivered to the agent of the
Trust for sale pursuant to Trust Unit Purchase Agreements:
"TRUST UNIT INTEREST PAYMENT ELECTION" means an election by the Trust to
raise funds to satisfy all or part of an Interest Obligation on the
applicable Interest Payment Date in the manner described in the Trust Unit
Interest Payment Election Notice;
"TRUST UNIT INTEREST PAYMENT ELECTION AMOUNT" means the sum of the amount
of the aggregate proceeds resulting from the sale of Trust Units on the
Trust Unit Delivery Date pursuant to acceptable bids obtained pursuant to
the Trust Unit Bid Requests, together with any amount paid by the Trust in
respect of fractional Trust Units pursuant to Section 11.1(g) or otherwise
paid in cash, that is equal to the aggregate amount of the Interest
Obligation in respect of which the Trust Unit Interest Payment Election
Notice was delivered;
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"TRUST UNIT INTEREST PAYMENT ELECTION NOTICE" means a written notice made
by the Trust to the agent of the Trust specifying:
(i) the Interest Obligation to which the election relates;
(ii) the Trust Unit Interest Payment Election Amount;
(iii) the investment banks, brokers or dealers or the Manager or
any of its Affiliates through which the agent of the Trust
shall seek bids to purchase the Trust Units and the
conditions of such bids, which may include the minimum
number of Trust Units, minimum price per Trust Unit, timing
for closing for bids and such other matters as the Trust
may specify or with which the Trust will establish on
account or accounts for the purpose of selling Trust Units;
and
(iv) that the agent of the Trust shall accept through the
investment banks, brokers or dealers selected by the Trust
or the Manager or any of its Affiliates only those bids
which comply with such notice;
"TRUST UNIT PROCEEDS INVESTMENT" has the meaning attributed thereto in
Section 11.1l(h);
"TRUST UNIT PURCHASE AGREEMENT" means an agreement in customary form among
the Trust, the agent of the Trust, the Trustee (if applicable) and the
Persons making acceptable bids pursuant to a Trust Unit Bid Request, which
complies with all applicable laws, including the Applicable Securities
Legislation and the rules and regulations of any stock exchange on which
the Debentures or Trust Units are then listed;
"TSX" means The Toronto Stock Exchange or its successor or successors or
any other stock exchange on which the Trust Units are then traded;
"U.S. 1993 ACT LEGEND" has the meaning ascribed thereto in Section 2.14;
"U.S. PLAN ASSETS" means any underlying assets described in clause (iii) of
the definition of "U.S. Retirement Plan" and any assets of any "employee
benefit plan" or "plan" described in clause (i) or (ii) of such definition;
"U.S. RETIREMENT PLAN" means (i) any "employee benefit plan", as defined in
Section 3 of ERISA that is subject to Title I of ERISA, (ii) any "plan", as
defined in and subject to Section 4975 of the U.S. Tax Code, and (iii) any
other entity which may be deemed (pursuant to ERISA, regulations of the
United States Department of Labor or otherwise) to hold at any time assets
of any such "employee benefit plan" or "plan" for any purpose of ERISA or
Section 4975 of the U.S. Tax Code;
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"U.S. RETIREMENT PLAN DEBENTURES" has the meaning ascribed thereto in
Section 7.2;
"U.S. RETIREMENT PLAN HOLDER" has the meaning ascribed thereto in Section
7.2;
"U.S. RETIREMENT PLAN NOTICE" has the meaning ascribed thereto in Section
7.2;
"U.S. RETIREMENT PLAN PROHIBITION" has the meaning ascribed thereto in
Section 7.2;
"U.S. TAX CODE" means the United States Internal Revenue Code of 1986, as
amended, or any successor statute;
"UNIT REDEMPTION RIGHT" has the meaning ascribed thereto in Section 4.6(a);
"UNIT REPAYMENT RIGHT" has the meaning ascribed thereto in Section 4.10(a);
"UNITED STATES" means the United States of America, its territories and
possessions, any State of the United States and the District of Columbia;
and
"WRITTEN DIRECTION OF THE TRUST" means an instrument in writing signed by
any one officer or trustee of the Trust or by any one officer or director
of the Manager on behalf of the Trust.
1.2 MEANING OF "OUTSTANDING"
Every Debenture certified and delivered by the Trustee hereunder shall
be deemed to be outstanding until it is cancelled, converted or redeemed or
delivered to the Trustee for cancellation, conversion or redemption or moneys or
Trust Units, as the case may be, or the payment thereof shall have been set
aside under Section 10.2, provided that:
(a) Debentures which have been partially redeemed, purchased or converted
shall be deemed to be outstanding only to the extent of the
unredeemed, unpurchased or unconverted part of the principal amount
thereof;
(b) when a new Debenture has been issued in substitution for a Debenture
which has been lost, stolen or destroyed, only the new Debenture shall
be counted for the purpose of determining the aggregate principal
amount of Debentures outstanding; and
(c) for the purposes of any provision of this Indenture entitling
Debentureholders of outstanding Debentures to vote, sign consents,
requisitions or other instruments or take any other action under this
Indenture, or to constitute a quorum of any meeting of
Debentureholders, Debentures owned directly or indirectly, legally or
equitably, by the Trust shall be disregarded except that:
(i) for the purpose of determining whether the Trustee shall be
protected in relying on any such vote, consent, requisition or
other instrument or
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action, or on the Debentureholders present or represented at any
meeting of Debentureholders, only the Debentures which the
Trustee knows are so owned shall be so disregarded; and
(ii) Debentures so owned which have been pledged in good faith other
than to the Trust or a Subsidiary of the Trust shall not be so
disregarded if the pledgee shall establish to the satisfaction of
the Trustee the pledgee's right to vote such Debentures, sign
consents, requisitions or other instruments or take such other
actions in his discretion free from the control of the Trust or a
Subsidiary of the Trust.
1.3 INTERPRETATION
In this Indenture:
(a) words importing the singular number or masculine gender shall include
the plural number or the feminine or neuter genders, and vice versa;
(b) all references to Articles and Schedules refer, unless otherwise
specified, to articles of and schedules of this Indenture;
(c) all references to Sections, subsections or clauses refer, unless
otherwise specified, to sections, subsections or clauses of this
Indenture; and
(d) words and terms denoting inclusiveness (such as "INCLUDE" or
"INCLUDES" or "INCLUDING"), whether or not so stated, are not limited
by and do not imply limitation of their context or the words or
phrases which precede or succeed them.
1.4 HEADINGS ETC.
The division of this Indenture into Articles and Sections, the
provision of a Table of Contents and the insertion of headings are for
convenience of reference only and shall not affect the construction or
interpretation of this Indenture or of the Debentures.
1.5 DAY NOT A BUSINESS DAY
In the event that any day on or before which any action required to be
taken hereunder is not a Business Day, then such action shall be required to be
taken on or before the requisite time on the next succeeding day that is a
Business Day.
1.6 APPLICABLE LAW
This Indenture and the Debentures shall be construed in accordance
with the laws of the Province of Ontario and the laws of Canada applicable
therein and shall be treated in all respects as Ontario contracts.
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1.7 MONETARY REFERENCES
Whenever any amounts of money are referred to herein, such amounts
shall be deemed to be in lawful money of Canada unless otherwise expressed.
1.8 INVALIDITY, ETC.
Any provision hereof which is prohibited or unenforceable shall be
ineffective only to the extent of such prohibition or unenforceability, without
invalidating the remaining provisions hereof.
1.9 LANGUAGE
Each of the parties hereto hereby acknowledges that it has consented
to and requested that this Indenture and all documents relating thereto,
including, without limiting the generality of the foregoing, the form of
Debenture attached hereto as Schedule A be drawn up in the English language
only. Chacune des parties aux presentes reconnait par les presentes qu'elle a
demande et consent a ce que le present acte de fiducie et tous les documents s'y
rattachant, notamment la formule de debenture jointe aux presentes en tant
qu'annexe A, ne soient rediges qu'en anglais.
1.10 SUCCESSORS AND ASSIGNS
All covenants and agreements in this Indenture by the Trust shall bind
its successors and assigns, whether expressed or not.
1.11 BENEFITS OF INDENTURE
Nothing in this Indenture or in the Debentures, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, any paying agent, the Debentureholders (and each such Person who
becomes a holder of Debentures), the trustees, the Manager and (to the extent
provided in Sections 1.13 and 9.11) the holders of Trust Units, any benefit or
any legal or equitable right, remedy or claim under this Indenture, save and
except the rights of holders of Senior Indebtedness and their representatives
granted hereunder.
1.12 REFERENCES TO ACTS OF THE TRUST
For greater certainty, where any reference is made in this Indenture,
or in any other instrument executed pursuant hereto or contemplated hereby to
which the Trust is party, to an act to be performed by, an obligation or
liability of, an asset or right of, or a covenant by, the Trust, such reference
shall be construed and applied for all purposes as if it referred to an act to
be performed by, an obligation or liability of, or a covenant by, the trustees.
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1.13 NO RECOURSE
The parties hereto acknowledge that the Manager is entering into this
Indenture solely in its capacity as agent on behalf of the Trust and the
obligations of the Trust hereunder shall not be personally binding upon the
Manager or any of the holders of Trust Units of the Trust or any annuitant under
a plan of which a holder of Trust Units is a trustee or carrier and that any
recourse against the Trust, the Manager, or any Affiliates of the Trust or
Manager, or any of their officers, employees and agents, or any holder of Trust
Units or annuitant in any manner in respect of any indebtedness, obligation or
liability of the Trust arising hereunder or arising in connection herewith or
from the matters to which this agreement relates, if any, including without
limitation claims based on negligence or otherwise tortious behaviour, shall be
limited to, and satisfied only out of, the property of the Trust.
1.14 SCHEDULES
The following Schedules form part of this Indenture:
Schedule "A" - Form of Debenture;
Schedule "B" - Form of Redemption Notice
Schedule "C" - Form of Maturity Notice
Schedule "D" - Form of Notice of Conversion
Schedule "E" - Form of Declaration for Removal of Legend
Schedule "F" - Form of Put Exercise Notice
ARTICLE 2
THE DEBENTURES
2.1 LIMIT OF DEBENTURES
Subject to the limitations in respect of the Initial Debentures set
out in Section 2.4(a), the aggregate principal amount of Debentures authorized
to be issued under this Indenture is unlimited, but Debentures may be issued
only upon and subject to the conditions and limitations herein set forth.
2.2 TERMS OF DEBENTURES OF ANY SERIES
The Debentures may be issued in one or more series. There shall be
established herein or in or pursuant to one or more indentures supplemental
hereto, prior to the initial issuance of Debentures of any particular series:
(a) the designation of the Debentures of the series (which need not
include the term "DEBENTURES"), which shall distinguish the Debentures
of the series from the Debentures of all other series;
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(b) any limit upon the aggregate principal amount of the Debentures of the
series that may be certified and delivered under this Indenture
(except for Debentures certified and delivered upon registration of,
transfer of, amendment of, or in exchange for, or in lieu of, other
Debentures of the series pursuant to Sections 2.9, 2.10, 3.2, 3.3, and
3,6);
(c) the date or dates on which the principal of the Debentures of the
series is payable;
(d) the rate or rates at which the Debentures of the series shall bear
interest, if any, the date or dates from which such interest shall
accrue, on which such interest shall be payable and on which a record,
if any, shall be taken for the determination of Debentureholders to
whom such interest shall be payable and/or the method or methods by
which such rate or rates or date or dates shall be determined;
(e) the place or places where the principal of and any interest on
Debentures of the series shall be payable, the manner of such payment,
and where any Debentures of the series may be surrendered for
registration of transfer or exchange;
(f) the right, if any, of the Trust to redeem Debentures of the series, in
whole or in part, at its option and the period or periods within
which, the price or prices at which and any terms and conditions upon
which, Debentures of the series may be so redeemed, pursuant to any
sinking fund or otherwise in whole or in part;
(g) the obligation, if any, of the Trust to redeem, purchase or repay
Debentures of the series pursuant to any mandatory redemption,
repurchase, repayment, sinking fund or analogous provisions, in whole
or in part, or at the option of a Debentureholder thereof and the
price or prices at which, the period or periods within which, the date
or dates on which, and any terms and conditions upon which, Debentures
of the series shall be redeemed, purchased or repaid, in whole or in
part, pursuant to such obligations;
(h) if other than denominations of $1,000 and any integral multiple
thereof, the denominations in which Debentures of the series shall be
issuable;
(i) subject to the provisions of this Indenture, any trustees,
Depositaries, authenticating or paying agents, transfer agents or
registrars or any other agents with respect to the Debentures of the
series;
(j) any additional events of default or covenants with respect to the
Debentures of the series;
(k) whether and under what circumstances the Debentures of the series will
be convertible into or exchangeable, in whole or in part, for
securities of any Person;
(1) the form and terms of the Debentures of the series;
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(m) if applicable, that the Debentures of the series shall be issuable in
whole or in part as one or more Global Debentures and, in such case,
the Depositary or Depositaries for such Global Debentures in whose
name the Global Debentures will be registered, and any circumstances
other than or in addition to those set forth in Section 2.9 or 3.2 or
those applicable with respect to any specific series of Debentures, as
the case may be, in which any such Global Debenture may be exchanged,
in whole or in part, for Fully Registered Debentures, or transferred,
in whole or in part, to and registered in the name of a Person other
than the Depositary for such Global Debentures or a nominee thereof;
(n) if other than Canadian currency, the currency in which the Debentures
of the series are issuable;
(o) any other terms of the Debentures of the series (which terms shall not
be inconsistent with the provisions of this Indenture); and
(p) any stock exchange on which the series of the Debentures may be listed
at the time of issuance.
All Debentures of any one series shall be substantially identical, except as may
otherwise be established herein or by or pursuant to a resolution of the Board
of Directors, on behalf of the Trust, an Officer's Certificate or an indenture
supplemental hereto. All Debentures of any one series need not be issued at the
same time and may be issued from time to time, including pursuant to a Periodic
Offering, consistent with the terms of this Indenture, if so provided herein, by
or pursuant to such resolution of the Board of Directors, on behalf of the
Trust, Officer's Certificate or in an indenture supplemental hereto.
2.3 FORM OF DEBENTURES
Except in respect of the Initial Debentures, the form of which is
provided for herein, the Debentures of each series shall be substantially in
such form or forms (not inconsistent with this indenture) as shall be
established herein or by or pursuant to one or more resolutions of the Board of
Directors, on behalf of the Trust (as set forth in a resolution of the Board of
Directors, on behalf of the Trust or to the extent established pursuant to
rather than set forth in a resolution of the Board of Directors, on behalf of
the Trust, in an Officer's Certificate detailing such establishment) and in one
or more indentures supplemental hereto, in each case with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have imprinted or otherwise reproduced
thereon such legend or legends or endorsements, not inconsistent with the
provisions of this Indenture, as may be required to comply with any applicable
law or with any rules or regulations pursuant thereto or with any rules or
regulations of any securities exchange or securities regulatory authority or to
conform to general usage, all as may be determined by a director or officer of
the Manager executing such Debentures, as conclusively evidenced by their
execution of such Debentures. The Trustee shall not be required to ensure
compliance with any law or with rules or regulations thereto or with any rules
or regulations of any securities exchange or securities regulatory
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authority or to conform to general usage in connection with the issue, transfer
or exchange of the Debentures. The responsibility for compliance with the
foregoing shall be that of the Trust, or the Debentureholder, as applicable.
2.4 FORM AND TERMS OF INITIAL DEBENTURES
(a) The first series of Debentures (the "INITIAL DEBENTURES") authorized
for issue immediately is limited to an aggregate principal amount of
$85,000,000 and shall be designated as "6.65% Convertible Unsecured
Subordinated Debentures". However, subject to the provisions set out
herein, additional Debentures may be issued pursuant to the Debenture
after the date hereof.
(b) The Initial Debentures shall be dated as of July 20, 2004, shall
mature on July 31, 2011 and shall bear interest from the date of issue
at the rate of 6.65% per annum, payable in equal semi-annual payments
in arrears on July 31 and January 31 in each year, except the first
such payment to fall due on January 31, 2005 in the amount of $35.7096
per $1,000 principal amount of Initial Debentures, payable after as
well as before maturity and after as well as before default, with
interest on amounts in default at the same rate, compounded
semi-annually.
(c) The Initial Debentures will be redeemable in accordance with the terms
of Article 4, provided that the Initial Debentures will not be
redeemable on or before July 31, 2007, except in the event of the
satisfaction of certain conditions after a Change of Control has
occurred as outlined herein. After July 31, 2007, and on or before
July 31, 2009, the Initial Debentures may be redeemed in whole at any
time or in part from time to time at the option of the Trust on notice
as provided for in Section 4.3 provided that the Current Market Price
immediately preceding the date on which such notice of redemption is
given is at least 125% of the Conversion Price and the Trust shall
have provided to the Trustee an Officer's Certificate confirming such
Current Market Price and in addition thereto, at the time of
redemption, the Trust shall pay to the Debentureholder accrued and
unpaid interest (net of withholding tax). The Redemption Price for the
Initial Debentures will be a price equal to their principal amount
excluding accrued and unpaid interest. After July 31, 2009 and prior
to the Maturity Date, the Initial Debentures may be redeemed at the
option of the Trust in whole or in part from time to time on notice as
provided for in Section 4.3 hereof at the Redemption Price,
irrespective of the Current Market Price and, in addition thereto, at
the time of redemption, the Trust shall pay to the Debentureholder
accrued and unpaid interest (net of withholding tax). The Redemption
Notice for the Initial Debentures shall be in the form of Schedule B.
(d) The Initial Debentures will be subordinated to the Senior Indebtedness
of the Trust in accordance with the provisions of Article 5; provided
however, that nothing contained in this Indenture shall in any way or
manner restrict the Trust from incurring, directly or indirectly, any
additional indebtedness.
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(e) Upon and subject to the provisions and conditions of Article 6, the
Debentureholder of each Initial Debenture shall have the right at such
Debentureholder's option, at any time prior to 5 p.m. Toronto Time on
the earlier of July 31, 2011 and the last Business Day immediately
preceding the date specified by the Trust for redemption of the
Initial Debentures by notice to the Debentureholders of Initial
Debentures in accordance with Sections 2.4(c) and 4.3 (the earlier of
which will be the "TIME OF EXPIRY" for the purposes of Article 6 in
respect of the Initial Debentures), to convert the whole or, in the
case of a Debenture of a denomination in excess of $1,000, any part
which is $l,000 or an integral multiple thereof, of the principal
amount of such Debenture into Trust Units at the Conversion Price in
effect on the Date of Conversion (as defined in Section 6.4(b)).
The Conversion Price in effect on the date hereof for each Trust Unit
to be issued upon the conversion of Initial Debentures shall be equal
to $10.65 such that approximately 93.8967 Trust Units shall be issued
for each $1,000 principal amount of Initial Debentures so converted.
No adjustment will be made for distributions on Trust Units issuable
upon conversion. Debentureholders converting their Initial Debentures
following a Redemption Notice shall be entitled to receive, in
addition to the applicable number of Trust Units, accrued and unpaid
interest (net of withholding tax) in respect thereof for the period up
to the Date of Conversion from the latest Interest Payment Date. The
Conversion Price applicable to and the Trust Units, securities or
other property receivable on the conversion of the Initial Debentures
is subject to adjustment pursuant to the provisions of Section 6.5.
(f) On redemption or on maturity of the Initial Debentures, the Trust may,
at its option and subject to the provisions of Section 4.6 and Section
4.10 as applicable, and subject to regulatory approval, elect to
satisfy its obligation to pay all or a portion of the aggregate the
principal amount of the Initial Debentures by issuing and delivering
to the Debentureholders of Initial Debentures Freely Tradeable Trust
Units. If the Trust elects to exercise such option, it shall deliver a
Redemption Notice (as defined in Section 4.3) or a maturity notice
(the "MATURITY NOTICE") to the Debentureholders of the Initial
Debentures in the form of Schedule B or Schedule C, as applicable.
(g) The Initial Debentures shall be issued as Fully Registered Debentures
in denominations of $1,000 and integral multiples of $1,000 and the
Trustee is hereby appointed as registrar and transfer agent for the
Initial Debentures. Each Initial Debenture and the certificate of the
Trustee endorsed thereon shall be issued in substantially the form set
out in Schedule A, with such insertions, omissions, substitutions or
other variations as shall be required or permitted by this Indenture
and may have imprinted or otherwise reproduced thereon such legend or
legends or endorsements, not inconsistent with the provisions of this
Indenture, as may be required to comply with any law or with any rules
or
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regulations pursuant thereto or with any rules or regulations of any
securities exchange or securities regulatory authority or to conform
with general usage, all as may be determined by the Board of Directors
on behalf of the Trust executing such Initial Debenture in accordance
with Section 2.7 hereof, as conclusively evidenced by their execution
of an Initial Debenture. Each Initial Debenture shall additionaily
bear such distinguishing letters and numbers as the Trustee shall
approve. Notwithstanding the foregoing, an Initial Debenture may be in
such other form or forms as may, from time to time, be approved by a
resolution of the Board of Directors on behalf of the Trust or as
specified in an Officer's Certificate. The Initial Debentures may be
engraved, lithographed, printed, mimeographed or typewritten or partly
in one form and partly in another.
The Initial Debentures shall be issued as Global Debentures and the
Depository for the Initial Debentures shall be The Canadian Depository
for Securities Limited. The Global Debentures shall be registered in
the name of The Canadian Depository for Securities Limited (or any
nominee of the Depository). No Beneficial Holder will receive
definitive certificates representing their interest in Debentures
except as provided in Section 3.2. A Global Debenture may be exchanged
for Debentures in registered form that are not Global Debentures, or
transferred to and registered in the name of a Person other than the
Depository for such Global Debentures or a nominee thereof as provided
in Section 3.2.
(h) Upon and subject to the provisions and conditions of Article II, the
Trust may elect, from time to time, to satisfy its Interest Obligation
on the Initial Debentures on any Interest Payment Date by delivering
Trust Units to the agent appointed for such purpose on behalf of the
Trust.
(i) Within 30 days following the occurrence of a Change of Control, and
subject to the provisions and conditions of this Section 2.4(i), the
Trust shall be obligated to offer Debentureholders the right to
require the Trust to purchase their Initial Debentures, in accordance
with the terms and conditions of such right set forth below:
(i) Within 30 days following the occurrence of a Change of Control,
each Debentureholder of Initial Debentures shall have the right
(the "PUT RIGHT") to require the Trust to purchase, on the date
which is 30 days following the date upon which the Trustee
delivers a Change of Control Notice (as defined below) to the
Debentureholders of Initial Debentures (the "PUT DATE"), all or
any part of such Debentureholder's Initial Debentures in
accordance with the requirements of Applicable Securities
Legislation at a price equal to 101% of the principal amount
thereof (the "PUT PRICE") plus accrued and unpaid interest on
such Initial Debentures up to, but excluding, the Put Date
(collectively, the "TOTAL PUT PRICE").
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(ii) The Trust will, as soon as practicable, and in any event no
later than 2 days after the occurrence of a Change of Control,
give written notice to the Trustee of the Change of Control.
Such written notice of the Trust shall state whether the Put
Price will be payable in cash or satisfied, in whole or in
part, by the issuance of Trust Units, as contemplated in
Subsection 2.4(i)(xiii). The Trustee will, as soon as
practicable thereafter, and in any event no later than 2 days
after receiving notice from the Trust of the Change of Control,
provide written notice to the Debentureholders of Initial
Debentures of the Change of Control (the "CHANGE OF CONTROL
NOTICE"). The Change of Control Notice shall include a
description of the Change of Control, details of the
Debentureholders' Put Right under the terms of the Indenture,
details regarding whether the Put Price is to be paid in cash
or, in whole or in part, in Trust Units, a statement that each
Debentureholder will be entitled to withdraw his election to
require the Trust to purchase if the Trustee receives, no later
than the close of business on the third Business Day
immediately preceding the Put Date, a facsimile transmission or
letter setting forth the name of such Debentureholder, the
principal amount of the Initial Debentures delivered for
purchase and a statement that such Debentureholder is
withdrawing his election to have the Initial Debentures
purchased and a description of the rights of the Trust to
redeem untendered Initial Debentures in accordance with Section
2.4(i)(iv) hereof.
(iii) To exercise the Put Right, the Debentureholder must deliver to
the Trustee, not less than 5 Business Days prior to the Put
Date, written notice of the Debentureholder's exercise of such
right in the form attached as Schedule F together with (a) the
Initial Debentures with respect to which the right is being
exercised, duly endorsed for transfer, or (b) if the Initial
Debentures have been issued as Global Debentures, a duly
endorsed form of transfer.
(iv) If 90% or more in aggregate principal amount of Initial
Debentures outstanding on the date the Trust provides notice of
a Change of Control to the Trustee have been tendered for
purchase pursuant to the Put Right on the Put Date, the Trust
has the right upon written notice provided to the Trustee prior
to the Put Date, to redeem all the remaining outstanding
Initial Debentures on the Put Date at the Total Put Price (the
"90% REDEMPTION RIGHT").
(v) Upon receipt of notice that the Trust shall exercise the 90%
Redemption Right and acquire the remaining Initial Debentures,
the Trustee shall promptly provide written notice to all
Debentureholders that did not previously exercise the Put Right
that:
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(A) The Trust has exercised the 90% Redemption Right and will
purchase all outstanding Initial Debentures on the Put Date
at the Total Put Price, including a calculation of such
Debentureholder's Total Put Price;
(B) They must transfer their Initial Debentures to the Trustee
on the same terms as those Debentureholders that exercised
the Put Right and must send their respective Initial
Debentures, duly endorsed for transfer, or their duly
endorsed form of transfer, as applicable, to the Trustee
within 10 days after sending of such notice; and
(C) The rights of such Debentureholder under the terms of the
Initial Debentures cease as of the Put Date provided the
Trust has paid the Total Put Price to, or to the order of,
the Trustee and thereafter the Initial Debentures shall not
be considered to be outstanding and the Debentureholder
shall not have any right except to receive the Total Put
Price upon surrender and delivery of such Debentureholder's
Initial Debentures in accordance with the Indenture.
(vi) Subject to Section 2.4(i)(xiii), the Trust shall, on or before
11:00 a.m., Toronto time on the Business Day immediately prior
to the Put Date, deposit with the Trustee or any paying agent
to the order of the Trustee, such sums of money, as may be
sufficient to pay the Total Put Price of the Initial Debentures
to be purchased or redeemed by the Trust on the Put Date,
provided the Trust may elect to satisfy this requirement by
providing the Trustee with a certified cheque for such amounts
required under this Section 2.4(i)(vi) post-dated to the Put
Date or the Trust may satisfy this requirement by an electronic
funds transfer of such sums of money on the Put Date. To the
extent requested by the Trustee, the Trust shall also deposit
with the Trustee a sum of money sufficient to pay any charges
or expenses which may be incurred by the Trustee in connection
with such purchase and/or redemption, as the case may be. Every
such deposit shall be irrevocable. From the sums so deposited,
the Trustee shall pay or cause to be paid to the
Debentureholders of such Initial Debentures, the Total Put
Price, and interest, if any, to which they are entitled on the
Trust's purchase or redemption.
(vii) In the event that one or more of such Initial Debentures being
purchased in accordance with this Section 2.4(i) becomes
subject to purchase in part only, upon surrender of such
Initial Debentures for payment of the Total Put Price, the
Trust shall execute and the Trustee shall certify and deliver
without charge to the Debentureholder thereof or upon the
Debentureholder's order, one or more new Initial Debentures for
the portion of the principal amount of the Initial Debentures
not purchased.
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(viii) Initial Debentures for which Debenturehoiders have exercised
the Put Right and Initial Debentures which the Trust has
elected to redeem in accordance with this Section 2.4(i) shall
become due and payable at the Total Put Price on the Put Date,
in the same manner and with the same effect as if it were the
date of maturity specified in such Initial Debentures, anything
therein or herein to the contrary notwithstanding, and from and
after such Put Date, if the money necessary to purchase or
redeem the Initial Debentures shall have been deposited as
provided in this Section 2.4(i) and affidavits or other proofs
satisfactory to the Trustee as to the publication and/or
mailing of such notices shall have been lodged with it,
interest on the Initial Debentures shall cease. If any question
shall arise as to whether any notice has been given as above
provided and such deposit made, such question shall be decided
by the Trustee whose decision shall be final and binding upon
all parties in interest.
(ix) In case the Debentureholder of any Initial Debenture to be
purchased or redeemed in accordance with this Section 2.4(i)
shall fail on or before the Put Date so to surrender such
Debentureholder's Initial Debenture or duly endorsed form of
transfer or shall not within such time accept payment of the
moneys payable, or give such receipt therefor, if any, as the
Trustee may require, such moneys may be set aside in trust
without interest, either in the deposit department of the
Trustee or in a chartered bank, and such setting aside shall
for all purposes be deemed a payment to the Debentureholder of
the sum so set aside and, to that extent, the Initial Debenture
shall thereafter not be considered as outstanding hereunder and
the Debentureholder shall have no other right except to receive
payment of the moneys so paid and deposited, upon surrender and
delivery up of such Debentureholder's Initial Debenture, of the
Total Put Price. In the event that any money required to be
deposited hereunder with the Trustee or any depositary or
paying agent on account of principal, premium, if any, or
interest, if any, on Initial Debentures issued hereunder shall
remain so deposited for a period of ten years from the Put
Date, then such moneys, together with any accumulated interest
thereon, shall at the end of such period be paid over or
delivered over by the Trustee or such depositary or paying
agent to the Trust and the Trustee shall not be responsible to
Debentureholders for any amounts owing to them.
(x) Subject to the provisions above related to Initial Debentures
purchased in part, all Initial Debentures redeemed and paid
under this Section 2.4(i) shall forthwith be delivered to the
Trustee and cancelled and no Initial Debentures shall be issued
in substitution therefor.
(xi) The Trust will publicly announce the results of the purchases
made pursuant to this Section 2.4(i) as soon as practicable
after the Put Date.
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(xii) The Trust will comply with all Applicable Securities
Legislation in the event that the Trust is required to
repurchase Initial Debentures pursuant to this Section 2.4(i).
(xiii) Notwithstanding any other provision of this Indenture, the
Trust shall be entitled at its option, subject to regulatory
approval, to deposit with the Debenture Trustee or any paying
agent to the order of the Debenture Trustee, in lieu of all or
any portion of the cash which would otherwise be required to be
deposited with the Debenture Trustee hereunder in payment of
the Put Price, Freely Tradeable Trust Units for purposes of
making payment of all or any portion of the Put Price. If the
Trust elects to pay the Put Price in Freely Tradeable Trust
Units, the number of such Freely Tradeable Trust Units will be
determined by dividing the Put Price by 95% of the Current
Market Price in effect on the Put Date, and then multiplying
the quotient by the fraction of the Put Price to be satisfied
by Freely Tradeable Trust Units. No fractional Trust Units
shall be issued as payment of the Put Price but in lieu thereof
the Trust shall satisfy fractional interests by a cash payment
equal to the relevant fraction of the fractional interest in a
Trust Unit multiplied by the Current Market Price of the Trust
Units in effect on the Put Date. In all other respects, in
paying the Put Price the Trust shall be subject to the
requirements of Section 2.4(i)(vi) and the Debenture Trustee
shall, in making payment to holders of such Initial Debentures
pursuant to Section 2.4(i)(vi) of the Put Price, make payment
using such Freely Tradeable Trust Units. Solely for purposes of
this Section 2.4(i)(xiii), the term "Current Market Price" as
set forth in Section 1.1 shall be modified to provide that in
the event the Trust Units are not at the relevant time listed
on any stock exchange or traded on the over-the-counter market,
the Current Market Price shall be the fair market value of the
Trust Units as determined by the Trust or the Manager, on
behalf of the Trust, acting reasonably. In the event the Trust
exercises its right pursuant to this Section 2.4(i)(xiii) to
deliver Freely Tradeable Trust Units, the provisions of
paragraphs (c) to (l) inclusive of Section 4.10 shall apply,
mutatis mutandis.
(j) The Trustee shall be provided with the documents and instruments
referred to in Sections 2.5(b), (c) and (d) with respect to the
Initial Debentures prior to the issuance of the Initial Debentures.
2.5 CERTIFICATION AND DELIVERY OF ADDITIONAL DEBENTURES
The Trust may from time to time request the Trustee to certify and
deliver Additional Debentures of any series by delivering to the Trustee the
documents referred to below in this Section 2.5 whereupon the Trustee shall
certify such Additional Debentures and cause the same to be delivered in
accordance with the Written Direction of the Trust referred to below or pursuant
to such procedures acceptable to the Trustee as may be specified from time to
time by a
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Written Direction of the Trust. The maturity date, issue date, interest rate (if
any) and any other terms of the Additional Debentures of such series shall be
set forth in a supplemental indenture determined by or pursuant to such Written
Direction of the Trust. In certifying such Additional Debentures, the Trustee
shall be entitled to receive and shall be fully protected acting upon or in
relying upon, unless and until such documents have been superseded or revoked:
(a) an Officer's Certificate and an executed supplemental indenture by or
pursuant to which the form and terms of such Additional Debentures
were established;
(b) a Written Direction of the Trust requesting certification and delivery
of such Additional Debentures and setting forth delivery instructions,
provided that, with respect to Additional Debentures of a series
subject to a Periodic Offering:
(i) such Written Direction of the Trust may be delivered by the
Trust to the Trustee prior to the delivery to the Trustee of
such Additional Debentures of such series for certification and
delivery,
(ii) the Trustee shall certify and deliver Additional Debentures of
such series for original issue from time to time, in an
aggregate principal amount not exceeding the aggregate principal
amount, if any, established for such series, pursuant to a
Written Direction of the Trust or pursuant to procedures
acceptable to the Trustee as may be specified from time to time
by a Written Direction of the Trust,
(iii) the maturity date or dates, issue date or dates, interest rate
or rates (if any) and any other terms of Additional Debentures
of such series shall be determined by an executed supplemental
indenture or by Written Direction of the Trust or pursuant to
such procedures, and
(iv) if provided for in such procedures, such Written Direction of
the Trust may authorize certification and delivery pursuant to
oral or electronic instructions from the Trust which oral or
electronic instructions shall be promptly confirmed in writing
(for greater certainty, the Trustee shall not be obliged to
accept oral or electronic instructions unless it is satisfied,
in its sole discretion, with the procedures therefor);
(c) an opinion of Counsel that all requirements imposed by this Indenture
or by law in connection with the proposed issue of Additional
Debentures have been complied with, subject to the delivery of certain
documents or instruments specified in such opinion; and
(d) an Officer's Certificate certifying that the Trust is not in default
under this Indenture, that the terms and conditions for the
certification and delivery of Additional Debentures have been complied
with, subject to the delivery of any
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documents or instruments specified in such Officer's Certificate, and
that no Event of Default exists or will exist upon such certification
and delivery.
2.6 ISSUE OF GLOBAL DEBENTURES
(a) The Trust may specify that the Debentures of a series are to be issued
in whole or in part as one or more Global Debentures registered in the
name of a Depositary, or its nominee, designated by the Trust in the
Written Direction of the Trust delivered to the Trustee at the time of
issue of such Debentures, and in such event the Trust shall execute
and the Trustee shall certify and deliver one or more Global
Debentures that shall:
(i) represent an aggregate amount equal to the principal amount of
the outstanding Debentures of such series to be represented by
one or more Global Debentures;
(ii) be delivered by the Trustee to such Depositary or pursuant to
such Depositary's instructions; and
(iii) bear a legend substantially to the following effect:
"This Debenture is a Global Debenture within the meaning of the
Indenture hereinafter referred to and is registered in the name
of a Depositary or a nominee thereof. This Debenture may not be
transferred to or exchanged for Debentures registered in the
name of any Person other than the Depositary or a nominee
thereof and no such transfer may be registered except in the
limited circumstances described in the Indenture. Every
Debenture authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, this Debenture
shall be a Global Debenture subject to the foregoing, except in
such limited circumstances described in the Indenture."
(iv) Each Depositary designated for a Global Debenture must, at the
time of its designation and at all times while it serves as such
Depositary, be a clearing agency registered or designated under
the securities legislation of the jurisdiction where the
Depositary has its principal offices.
2.7 EXECUTION OF DEBENTURES
All Debentures shall be signed (either manually or by facsimile signature)
by any one authorized signatory of the Manager on behalf of the Trust holding
office at the time of signing. A facsimile signature upon a Debenture shall for
all purposes of this Indenture be deemed to be the signature of the person whose
signature it purports to be. Notwithstanding that any person whose signature,
either manual or in facsimile, appears on a Debenture as a director or officer
of the Manager may no longer hold such office at the date of the Debenture or at
the
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date of the certification and delivery thereof, such Debenture shall be valid
and binding upon the Trust and entitled to the benefits of this Indenture.
2.8 CERTIFICATION
No Debenture shall be issued or, if issued, shall be obligatory or
shall entitle the Debentureholder to the benefits of this Indenture, until it
has been manually certified by or on behalf of the Trustee substantially in the
form set out in this Indenture, in the relevant supplemental indenture, or in
some other form approved by the Trustee. Such certification on any Debenture
shall be conclusive evidence that such Debenture is duly issued, is a valid
obligation of the Trust and the Debentureholder is entitled to the benefits
hereof.
The certificate of the Trustee signed on the Debentures, or interim
Debentures hereinafter mentioned, shall not be construed as a representation or
warranty by the Trustee as to the validity of this Indenture or of the
Debentures or interim Debentures or as to the issuance of the Debentures or
interim Debentures and the Trustee shall in no respect be liable or answerable
for the use made of the Debentures or interim Debentures or any of them or the
proceeds thereof. The certificate of the Trustee signed on the Debentures or
interim Debentures shall, however, be a representation and warranty by the
Trustee that the Debentures or interim Debentures have been duly certified by or
on behalf of the Trustee pursuant to the provisions of this Indenture.
2.9 INTERIM DEBENTURES OR CERTIFICATES
Pending the delivery of definitive Debentures of any series to the
Trustee, the Trust may issue and the Trustee certify in lieu thereof interim
Debentures in such forms and in such denominations and signed in such manner as
provided herein, entitling the Debentureholders thereof to definitive Debentures
of the series when the same are ready for delivery; or the Trust may execute and
the Trustee certify a temporary Debenture for the whole principal amount of
Debentures of the series then authorized to be issued hereunder and deliver the
same to the Trustee and thereupon the Trustee may issue its own interim
certificates in such form and in such amounts, not exceeding in the aggregate
the principal amount of the temporary Debenture so delivered to it, as the
Manager on behalf of the Trust and the Trustee may approve entitling the
Debentureholders thereof to definitive Debentures of the series when the same
are ready for delivery; and, when so issued and certified, such interim or
temporary Debentures or interim certificates shall, for all purposes but without
duplication, rank in respect of this Indenture equally with Debentures duly
issued hereunder and, pending the exchange thereof for definitive Debentures,
the Debentureholders of the interim or temporary Debentures or interim
certificates shall be deemed without duplication to be Debentureholders and
entitled to the benefit of this Indenture to the same extent and in the same
manner as though the said exchange had actually been made. Forthwith after the
Trust shall have delivered the definitive Debentures to the Trustee, the Trustee
shall cancel such temporary Debentures, if any, and shall call in for exchange
all interim Debentures or certificates that shall have been issued and forthwith
after such exchange shall cancel the same. No charge shall be made by the Trust
or the Trustee to the Debentureholders of such interim or temporary Debentures
or interim certificates for the exchange thereof. All interest paid upon interim
or temporary Debentures or interim certificates
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shall be noted thereon as a condition precedent to such payment unless paid by
cheque to the registered Debentureholders thereof.
2.10 MUTILATION, LOSS, THEFT OR DESTRUCTION
In case any of the Debentures issued hereunder shall become mutilated
or be lost, stolen or destroyed, the Trust, in its discretion, may issue, and
thereupon the Trustee shall certify and deliver, a new Debenture upon surrender
and cancellation of the mutilated Debenture, or in the case of a lost, stolen or
destroyed Debenture, in lieu of and in substitution for the same, and the
substituted Debenture shall be in a form approved by the Trustee and shall be
entitled to the benefits of this Indenture and rank equally in accordance with
its terms with all other Debentures issued or to be issued hereunder. In case of
loss, theft or destruction the applicant for a substituted Debenture shall
furnish to the Trust and to the Trustee such evidence of the loss, theft or
destruction of the Debenture as shall be satisfactory to each of them in their
discretion and shall also furnish an indemnity satisfactory to each of them in
their discretion. The applicant shall pay all reasonable expenses incidental to
the issuance of any substituted Debenture.
2.11 CONCERNING INTEREST
(a) Subject to Section 2.4(b) with respect to the calculation of interest
in respect of the initial interest payment to be paid on the Initial
Debentures, all Debentures issued hereunder, whether originally or
upon exchange or in substitution for previously issued Debentures
which are interest bearing, shall bear interest from their issue date
or from the last Interest Payment Date to which interest shall have
been paid or made available for payment on the outstanding Debentures
of that series and date of maturity, whichever shall be the later, or,
in respect of Debentures subject to a Periodic Offering, from their
issue date or from the last Interest Payment Date to which interest
shall have been paid or made available for payment on such Debentures;
provided that, in respect of the first interest payment after the
original issuance thereof, each Debenture of a series shall bear
interest from the later of the issue date of such Debenture and the
last Interest Payment Date preceding the issuance of such Debenture.
(b) Unless otherwise specifically provided in the terms of the Debentures
of any series, interest for any period of less than six months shall
be computed on the basis of a year of 365 days. Subject to Section
2.4(b) in respect of the method for calculating the amount of interest
to be paid on the Initial Debentures on the first Interest Payment
Date in respect thereof, with respect to any series of Debentures,
whenever interest is computed on a basis of a year (the "DEEMED YEAR")
which contains fewer days than the actual number of days in the
calendar year of calculation, such rate of interest shall be expressed
as a yearly rate for purposes of the Interest Act (Canada) by
multiplying such rate of interest by the actual number of days in the
calendar year of calculation and dividing it by the number of days in
the deemed year.
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2.12 DEBENTURES TO RANK PARI PASSU
The Debentures will be direct unsecured obligations of the Trust. Each
Debenture of the same series of Debentures will rank pari passu with each other
Debenture of the same series (regardless of their actual date or terms of issue)
and will rank pari passu or in priority in right of payment to other
indebtedness of the Trust which by the terms of the instrument creating or
evidencing such indebtedness is expressed to be pari passu with or subordinate
in right of payment to the Debentures. The payment of the principal of, and
interest on, the Debentures shall, as provided in Article 5, be subordinated and
postponed in light of payment to all Senior Indebtedness (including all payments
thereunder).
2.13 PAYMENTS OF AMOUNTS DUE ON MATURITY
Except as may otherwise be provided in any supplemental indenture in
respect of any series of Debentures and except as otherwise provided in this
Indenture, payments of amounts due upon maturity of the Debentures will be made
in the following manner. The Trustee will establish and maintain for the
residual benefit of the Trust, a Debt Account for each series of Debentures.
Each such Debt Account shall be maintained by and be subject to the control of
the Trustee for the purposes of this Indenture. On or before 11:00 a.m., Toronto
time on the Business Day immediately prior to each maturity date for Debentures
outstanding from time to time under this Indenture, the Trust will deposit in
the applicable Debt Account an amount sufficient to pay the amount payable in
respect of such Debentures, (including the principal amount together with any
accrued and unpaid interest thereon less any tax required by law to be deducted)
provided the Trust may elect to satisfy this requirement by providing the
Trustee with a certified cheque for such amounts required under this Section
2.13 post-dated to the applicable maturity date or the Trust may satisfy this
requirement by an electronic funds transfer of such sums of money on the
applicable maturity date. The Trustee, on behalf of the Trust will pay to each
Debentureholder entitled to receive payment the principal amount of and premium
(if any) and accrued and unpaid interest on the Debenture (less any tax required
to be deducted on the maturity date), upon surrender of the Debenture at the
Designated Office. The deposit or making available of such amounts to the
applicable Debt Account will satisfy and discharge the liability of the Trust
for the Debentures to which the deposit or making available of funds relates to
the extent of the amount deposited or made available (plus the amount of any tax
deducted as aforesaid) and such Debentures will thereafter to that extent not be
considered as outstanding under this Indenture and such Debentureholder will
have no other right in regard thereto other than to receive out of the money so
deposited or made available the amount to which it is entitled.
2.14 U.S. 1993 ACT LEGEND ON THE DEBENTURES
(a) The Debentures and the Trust Units issuable pursuant to the terms
thereof have not been and will not be registered under the 0000 Xxx.
All Debentures and the Trust Units issuable pursuant to the terms
thereof issued and sold in the United States in reliance on Rule 144A
under the 1933 Act, as well as all Debentures and the Trust Units
issuable pursuant to the terms thereof issued in exchange for or in
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substitution of the foregoing securities, shall bear the following
legend (the "U.S. 1933 ACT LEGEND"):
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT") OR
STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH
SECURITIES, AGREES FOR THE BENEFIT OF THE ISSUER AND ALGONQUIN POWER
MANAGEMENT INC. THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED ONLY (A) TO THE ISSUER, (B) OUTSIDE THE UNITED STATES IN
ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE 1933 ACT, OR (C)
INSIDE THE UNITED STATES IN ACCORDANCE WITH (1) RULE 144A UNDER THE
1933 ACT OR (2) RULE 144 UNDER THE 1933 ACT, IF AVAILABLE, AND IN EACH
CASE IN ACCORDANCE WITH ANY APPLICABLE LOCAL LAWS AND REGULATIONS. THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE LISTED ON THE TORONTO
STOCK EXCHANGE; HOWEVER, DELIVERY OF THIS CERTIFICATE MAY NOT
CONSTITUTE "GOOD DELIVERY" IN SETTLEMENT OF TRANSACTIONS ON THE
TORONTO STOCK EXCHANGE. A NEW CERTIFICATE NOT BEARING THIS LEGEND,
DELIVERY OF WHICH WILL CONSTITUTE "GOOD DELIVERY", MAY BE OBTAINED
FROM CIBC MELLON TRUST COMPANY UPON DELIVERY OF THIS CERTIFICATE AND A
DULY EXECUTED DECLARATION, IN A FORM SATISFACTORY TO CIBC MELLON TRUST
COMPANY AND THE ISSUER, TO THE EFFECT THAT THE SALE OF THE SECURITIES
REPRESENTED HEREBY IS BEING MADE IN COMPLIANCE WITH RULE 904 OF
REGULATION S UNDER THE 1933 ACT."
provided, that if the Debentures (or any such Trust Units) are being sold under
clause (B) above, and provided that the Trust is a "foreign issuer" within the
meaning of Regulation S under the 1933 Act at the time of sale, the U.S. 1933
Act Legend may be removed by providing a declaration to the Trustee, in its
capacity as the trustee hereunder and as the transfer agent for the Trust Units,
as set forth in Schedule E hereto (or as the Trustee or the Trust may prescribe
from time to time); and provided, further, that, if any such securities are
being sold under clause (C)(2) above, the U.S. 1933 Act Legend may be removed by
delivery to the Trustee, in its capacity as the trustee hereunder and as the
transfer agent for the Trust Units, of an opinion of counsel of recognized
standing, reasonably satisfactory to the Trust, to the effect that the U.S. 1933
Act Legend is no longer required under applicable requirements of the 1933 Act
or any applicable local laws or regulations. Provided that the Trustee obtains
confirmation from the Trust that such counsel is satisfactory to it, the Trustee
shall be entitled to rely on such opinion of counsel without further inquiry.
(b) Prior to the issuance of the Debentures, the Trust shall notify the
Trustee, in writing, concerning which Debentures are to bear the U.S.
1933 Act Legend. The
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Trustee will thereafter maintain a list of all registered
Debentureholders from time to time of Legended Debentures.
2.15 PAYMENT OF INTEREST
The following provisions shall apply to Debentures, except as
otherwise provided in Section 2.4(b) or elsewhere in this Indenture or specified
in a resolution of the Board of Directors, on behalf of the Trust, Officer's
Certificate or supplemental indenture relating to a particular series of
Additional Debentures:
(a) As interest becomes due on each Debenture (except on conversion, at
maturity or on redemption, when interest may at the option of the
Trust be paid upon surrender of such Debenture) the Trust, either
directly or through the Trustee or any agent of the Trustee, shall
send or forward by prepaid ordinary mail, electronic transfer of funds
or such other means as may be agreed to by the Trustee, payment of
such interest (less any tax required to be withheld therefrom) to the
order of the registered Debentureholder appearing on the registers
maintained by the Trustee at the close of business on the 5th Business
Day prior to the applicable Interest Payment Date and addressed to the
Debentureholder at the Debentureholder's last address appearing on the
register, unless such Debentureholder otherwise directs. If payment is
made by cheque such cheque shall be forwarded as soon as practicable
following the date on which interest becomes due and if payment is
made by other means (such as electronic transfer of funds), such
payment shall be made in a manner whereby the Debentureholder receives
credit for such payment on the date such interest on such Debenture
becomes due. The mailing of such cheque or the making of such payment
by other means shall, to the extent of the sum represented thereby,
plus the amount of any tax withheld as aforesaid, satisfy and
discharge all liability for interest on such Debenture, unless in the
case of payment by cheque, such cheque be not paid at par on
presentation. In the event of non-receipt of any cheque for or other
payment of interest by the Person to whom it is so sent as aforesaid,
the Trust will issue to such Person a replacement cheque or other
payment for a like amount upon being furnished with such evidence of
non-receipt as it shall reasonably require and upon being indemnified
to its satisfaction. Notwithstanding the foregoing, if the Trust is
prevented by circumstances beyond its control (including, without
limitation, any interruption in mail service) from making payment of
any interest due on each Debenture in the manner provided above, the
Trust may make payment of such interest or make such interest
available for payment in any other manner acceptable to the Trustee
with the same effect as though payment had been made in the manner
provided above.
(b) Notwithstanding Section 2.15(a), if a series of Debentures is
represented by a Global Debenture, then all payments of interest on
the Global Debenture shall be made by electronic funds transfer on
such Interest Payment Date to the Depositary or its nominee for
subsequent payment to Beneficial Holders in that Global
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Debenture, unless the Trust and the Depositary otherwise agree. The
record date for the payment of interest will be that day which is the
5th Business Day prior to the applicable Interest Payment Date. None
of the Trust, the Trustee or any agent of the Trustee for any
Debenture issued as a Global Debenture will be liable or responsible
to any Person for any aspect of the records related to or payments
made on account of beneficial interests in any Global Debenture or for
maintaining, reviewing, or supervising any records relating to such
beneficial interests.
ARTICLE 3
REGISTRATION, TRANSFER, EXCHANGE AND OWNERSHIP
3.1 FULLY REGISTERED DEBENTURES
(a) With respect to each series of Debentures issuable as Fully Registered
Debentures, the Trust shall cause to be kept by and at the Designated
Office, a register in which shall be entered the names and addresses
of the Debentureholders of Fully Registered Debentures and particulars
of the Debentures held by them respectively and of all transfers of
Fully Registered Debentures. Such registration shall be noted on the
Debentures by the Trustee or other registrar unless a new Debenture
shall be issued upon such transfer.
(b) No transfer of a Fully Registered Debenture shall be valid unless made
on such register referred to in Section 3.1(a) by the registered
Debentureholder or such Debentureholder's executors, administrators or
other legal representatives or an attorney duly appointed by an
instrument in writing in form and execution satisfactory to the
Trustee or other registrar upon surrender of the Debentures together
with a duty executed form of transfer acceptable to the Trustee and
upon compliance with such other reasonable requirements as the Trustee
or other registrar may prescribe, nor unless the name of the
transferee shall have been noted on the Debenture by the Trustee or
other registrar.
3.2 GLOBAL DEBENTURES
(a) With respect to each series of Debentures issuable in whole or in part
as one or more Global Debentures, the Trust shall cause to be kept by
and at the Designated Office, a register in which shall be entered the
name and address of the Debentureholder of each such Global Debenture
(being the Depositary, or its nominee, for such Global Debenture) as
Debentureholder thereof and particulars of the Global Debenture held
by it, and of all transfers thereof. If any Debentures of such series
are at any time not Global Debentures, the provisions of Section 3.1
shall govern with respect to registrations and transfers of such
Debentures.
(b) Notwithstanding any other provision of this Indenture, a Global
Debenture may not be transferred by the registered Debentureholder
thereof except in the
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following circumstances or as otherwise specified in the resolution of
the Board of Directors on behalf of the Trust, Officer's Certificate
or supplemental indenture relating to a particular series of
Additional Debentures:
(i) the Global Debenture may be transferred by a Depositary to a
nominee of such Depositary or by a nominee of a Depositary to
such Depositary or to another nominee of such Depositary or by a
Depositary or its nominee to a successor Depositary or its
nominee;
(ii) the Global Debenture may be transferred at any time after the
Depositary for such Global Debenture (i) has notified the Trust
that it is unwilling or unable to continue as Depositary for
such Global Debenture or (ii) ceases to be eligible to be a
Depositary under Section 2.6(a), provided that at the time of
such transfer the Trust has not appointed a successor Depositary
for such Global Debenture;
(iii) the Global Debenture may be transferred at any time after the
Trust has determined, in its sole discretion, to terminate the
book-entry only registration system in respect of such Global
Debenture and has communicated such determination to the Trustee
in writing; and
(iv) the Global Debenture may be transferred at any time after the
Trustee has determined that an Event of Default has occurred and
is continuing with respect to the Debentures of the series
issued as a Global Debenture, provided that at the time of such
transfer the Trustee has not waived the Event of Default
pursuant to Section 9.3, provided that Beneficial Holders
representing, in the aggregate, not less than 25% of the
aggregate principal amount of the Debentures of such series
advise the Depositary in writing, through the Depositary
Participants, that the continuation of the book-entry only
registration system for such series of Debentures is no longer
in their best interest and also provided that at the time of
such transfer the Debenture Trustee has not waived the Event of
Default pursuant to Section 9.3;
(v) Global Debentures may be transferred if required by applicable
law; or
(vi) Global Debentures may be transferred if the book-entry only
registration system ceases to exist.
(c) With respect to the Global Debentures, unless and until definitive
certificates have been issued to Beneficial Holders pursuant to
subsection 3.2(b):
(i) the Trust and the Debenture Trustee may deal with the Depositary
for all purposes (including paying interest on the Debentures)
as the sole
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Debentureholder of such series of Debentures and the authorized
representative of the Beneficial Holders;
(ii) the rights of the Beneficial Holders shall be exercised only
through the Depositary and shall be limited to those established
by law and agreements between such Beneficial Holders and the
Depositary or the Depositary Participants;
(iii) the Depositary will make book entry transfers between the
Depositary Participants; and
(iv) whenever this Trust Indenture requires or permits actions to be
taken based upon instructions or directions of Debentureholders
evidencing a specified percentage of the outstanding Debentures,
the Depositary shall be deemed to be counted in that percentage
only to the extent that it has received instructions to such
effect from the Beneficial Holders or the Depositary
Participants, and has delivered such instructions to the
Debenture Trustee.
(d) Whenever a notice or other communication is required to be provided to
Debentureholders, unless and until definitive certificate(s) have been
issued to Beneficial Holders pursuant to this Section 3.2, the
Debenture Trustee shall provide all such notices and communications to
the Depositary and the Depositary shall deliver such notices and
communications to such Beneficial Holders in accordance with
Applicable Securities Legislation. Upon the termination of the
book-entry only registration system on the occurrence of one of the
conditions specified in Section 3.2(b) with respect to a series of
Debentures issued hereunder, the Debenture Trustee shall notify all
applicable Beneficial Holders, through the Depositary, of the
availability of definitive Debenture certificates. Upon surrender by
the Depositary of the certificate(s) representing the Global
Debentures and receipt of new registration instructions from the
Depositary, the Debenture Trustee shall deliver the definitive
Debenture certificates for such Debentures to the Debentureholders
thereof in accordance with the new registration instructions and
thereafter, the registration and transfer of such Debentures will be
governed by Section 3.1 and the remaining Sections of this Article 3.
3.3 TRANSFEREE ENTITLED TO REGISTRATION
The transferee of a Debenture shall be entitled, after the appropriate
form of transfer is lodged with the Trustee or other registrar and upon
compliance with all other conditions in that behalf required by this Indenture
or by law, to be entered on the register as the owner of such Debenture free
from all equities or rights of set-off or counterclaim between the Trust and the
transferor or any previous Debentureholder of such Debenture, save in respect of
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equities of which the Trust is required to take notice by statute or by order of
a court of competent jurisdiction.
3.4 NO NOTICE OF TRUSTS
Neither the Trust nor the Trustee nor any registrar shall be bound to
take notice of or see to the execution of any trust (other than that created by
this Indenture) whether express, implied or constructive, in respect of any
Debenture, and may transfer the same on the direction of the Person registered
as the Debentureholder thereof, whether named as trustee or otherwise, as though
that Person were the beneficial owner thereof.
3.5 REGISTERS OPEN FOR INSPECTION
The registers referred to in Sections 3.1 and 3.2 shall at all
reasonable times during regular business hours be open for inspection by the
Trust, the Trustee or any Debentureholder. Every registrar, including the
Trustee, shall from time to time when requested so to do by the Trust or by the
Trustee, in writing, furnish the Trust or the Trustee, as the case may be, with
a list of names and addresses of registered Debentureholders entered on the
register kept by them and showing the principal amount and serial numbers of the
Debentures held by each such Debentureholder provided the Trustee shall be
entitled to charge a reasonable fee to provide such a list.
3.6 EXCHANGES OF DEBENTURES
(a) Subject to Section 3.7, Debentures in any authorized form or
denomination, other than Global Debentures, may be exchanged for
Debentures in any other authorized form or denomination, of the same
series and date of maturity, bearing the same interest rate and of the
same aggregate principal amount as the Debentures so exchanged.
(b) In respect of exchanges of Debentures permitted by Section 3.6(a),
Debentures of any series may be exchanged only at the Designated
Office. Any Debentures tendered for exchange shall be surrendered to
the Trustee. The Trust shall execute and the Trustee shall certify all
Debentures necessary to carry out exchanges as aforesaid. All
Debentures surrendered for exchange shall be cancelled.
(c) Debentures issued in exchange for Debentures which at the time of such
issue have been selected or called for redemption at later date shall
be deemed to have been selected or called for redemption in the same
manner and shall have noted thereon a statement to that effect.
3.7 CLOSING OF REGISTERS
Neither the Trust nor the Trustee nor any registrar shall be required
to:
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(i) make transfers, exchanges or accept conversions of Fully
Registered Debentures on any Interest Payment Date for such
Debentures or during the five preceding Business Days from the
Interest Payment Date;
(ii) make transfers, exchanges or accept conversions of any
Debentures during the period beginning 5 Business Days before
the day of the mailing of a Redemption Notice and ending on the
day of mailing of such a Redemption Notice; or
(iii) make exchanges of any Debentures which will have been selected
or called for redemption unless upon due presentation thereof
for redemption such Debentures shall not be redeemed.
3.8 CHARGES FOR REGISTRATION, TRANSFER AND EXCHANGE
For each Debenture exchanged, registered, transferred or discharged
from registration, the Trustee or other registrar, except as otherwise herein
provided, may make a reasonable charge for its services and in addition may
charge a reasonable sum for each new Debenture issued (such amounts to be agreed
upon by the Trustee and the Trust from time to time), and payment of such
charges and reimbursement of the Trustee or other registrar for any stamp taxes
or governmental or other charges required to be paid shall be made by the party
requesting such exchange, registration, transfer or discharge from registration
as a condition precedent thereto. Notwithstanding the foregoing provisions, no
charge shall be made to a Debentureholder hereunder:
(a) for any exchange, registration, transfer or discharge from
registration of any Debenture applied for within a period of two
months from the date of the first delivery of Debentures of that
series or, with respect to Debentures subject to a Periodic Offering,
within a period of two months from the date of delivery of any such
Debenture;
(b) for any exchange of any interim or temporary Debenture or interim
certificate that has been issued under Section 2.9 for a definitive
Debenture;
(c) for any exchange of a Global Debenture as contemplated in Section 3.2;
or
(d) for any exchange of any Debenture resulting from a partial redemption
under Section 4.2.
3.9 OWNERSHIP OF DEBENTURES
(a) Unless otherwise required by law, the Person in whose name any
registered Debenture is registered shall for all the purposes of this
Indenture be and be deemed to be the owner thereof and payment of or
on account of the principal of and premium, if any, on such Debenture
and, in the case of a Fully Registered Debenture, interest thereon
shall be made to such registered Debentureholder.
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(b) The registered Debentureholder for the time being of any registered
Debenture shall be entitled to the principal, premium, if any, and/or
interest evidenced by such instruments, respectively, free from all
equities or rights of set-off or counterclaim between the Trust and
the original or any intermediate Debentureholder thereof and all
Persons may act accordingly and the receipt of any such registered
Debentureholder for any such principal, premium or interest shall be a
good discharge to the Trust and/or the Trustee for the same and
neither the Trust nor the Trustee shall be bound to inquire into the
title of any such registered Debentureholder.
(c) Where Debentures are registered in more than one name, the principal,
premium, if any, and interest (in the case of Fully Registered
Debentures) from time to time payable in respect thereof may be paid
to the order of all such Debentureholders, failing written
instructions from them to the contrary, and the receipt of any one of
such Debentureholders therefor shall be a valid discharge, to the
Trustee, any registrar and to the Trust.
(d) In the case of the death of one or more joint Debentureholders the
principal, premium, if any, and interest from time to time payable
thereon may be paid to the order of the survivor or survivors of such
registered Debentureholders and the receipt of any such survivor or
survivors therefor shall be a valid discharge to the Trustee and any
registrar and to the Trust.
ARTICLE 4
REDEMPTION AND PURCHASE OF DEBENTURES
4.1 APPLICABILITY OF ARTICLE
Subject to regulatory approval, the Trust shall have the right at its
option to redeem or repay, either in whole at any time or in part from time to
time before maturity, either by payment of money, by issuance of Freely
Tradeable Trust Units as provided in Section 4.6 or any combination thereof, any
Debentures issued hereunder of any series which by their terms are made so
redeemable (subject, however, to any applicable restriction on the redemption of
Debentures of such series) at such rate or rates of premium, if any, and on such
date or dates and in accordance with such other provisions as shall have been
determined at the time of issue of such Debentures and as shall have been
expressed in this Indenture, in the Debentures, in an Officer's Certificate, or
in a supplemental indenture authorizing or providing for the issue thereof, or
in the case of Additional Debentures issued pursuant to a Periodic Offering, in
the Written Direction of the Trust requesting the certification and delivery
thereof.
4.2 PARTIAL REDEMPTION
If less than all the Debentures of any series for the time being
outstanding are at any time to be redeemed, or if a portion of the Debentures
being redeemed are being redeemed
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for cash and a portion of such Debentures are being redeemed by the payment of
Freely Tradeable Trust Units pursuant to Section 4.6, the Debentures to be so
redeemed shall be selected by the Trustee on a pro rata basis to the nearest
multiple of $1,000 in accordance with the principal amount of the Debentures
registered in the name of each Debentureholder or in such other manner as the
Trustee deems equitable, subject to the approval of the TSX, as may be required
from time to time. Unless otherwise specifically provided in the terms of any
series of Debentures, no Debenture shall be redeemed in part unless the
principal amount redeemed is $1,000 or a multiple thereof. For this purpose, the
Trustee may make, and from time to time vary, regulations with respect to the
manner in which such Debentures may be drawn for redemption in part or for
redemption in cash and regulations so made shall be valid and binding upon all
such Debentureholders notwithstanding the fact that as a result thereof one or
more of such Debentures may become subject to redemption in part only or for
cash only. In the event that one or more of such Debentures becomes subject to
redemption in part only, upon surrender of any such Debentures for payment of
the Redemption Price, together with interest accrued to but excluding the
Redemption Date, the Trust shall execute and the Trustee shall certify and
deliver without charge to the Debentureholder thereof or upon the
Debentureholder's order one or more new Debentures for the unredeemed part of
the principal amount of the Debenture or Debentures so surrendered or, with
respect to a Global Debenture, the Depositary shall make notations on the Global
Debenture of the principal amount thereof so redeemed. Unless the context
otherwise requires, the terms "DEBENTURE" or "DEBENTURES" as used in this
Article 4 shall be deemed to mean or include any part of the principal amount of
any Debenture which in accordance with the foregoing provisions has become
subject to redemption.
4.3 NOTICE OF REDEMPTION
Notice of redemption (the "REDEMPTION NOTICE") of any series of
Debentures shall be given to the Debentureholders so to be redeemed not more
than 60 days nor, subject to section 4.6(b) less than 30 days prior to the date
fixed for redemption (the "REDEMPTION DATE") in the manner provided in Section
15.2. Every such notice shall specify the aggregate principal amount of
Debentures called for redemption, the Redemption Date, the Redemption Price, the
places of payment and shall state that interest upon the principal amount of
Debentures called for redemption shall cease to be payable from and after the
Redemption Date. In addition, unless all the outstanding Debentures are to be
redeemed, the Redemption Notice shall specify:
(a) the distinguishing letters and numbers of the registered Debentures
which are to be redeemed (or of such thereof as are registered in the
name of such Debentureholder);
(b) in the case of a published notice, the distinguishing letters and
numbers of the Debentures which are to be redeemed or, if such
Debentures are selected by terminal digit or other similar system,
such particulars as may be sufficient to identify the Debentures so
selected;
(c) in the case of a Global Debenture, that the redemption will take place
in such manner as may be agreed upon by the Depositary, the Trustee
and the Trust; and
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(d) in all cases, the principal amounts of such Debentures or, if any such
Debenture is to be redeemed in part only, the principal amount of such
part.
In the event that all Debentures to be redeemed are registered
Debentures, publication shall not be required.
4.4 DEBENTURES DUE ON REDEMPTION DATES
Notice having been given as aforesaid, all the Debentures so called
for redemption shall thereupon be and become due and payable at the Redemption
Price, together with accrued interest to but excluding the Redemption Date, on
the Redemption Date specified in such notice, in the same manner and with the
same effect as if it were the date of maturity specified in such Debentures,
anything therein or herein to the contrary notwithstanding, and from and after
such Redemption Date, if the moneys necessary to redeem, or the Trust Units to
be issued to redeem, such Debentures shall have been deposited as provided in
Section 4.5 (unless payment of the Redemption Price shall not be made on
presentation for surrender of such Debenture) and affidavits or other proof
satisfactory to the Trustee as to the publication and/or mailing of such notices
shall have been lodged with it, interest upon the Debentures shall cease. If any
question shall arise as to whether any notice has been given as above provided
and such deposit made, such question shall be decided by the Trustee whose
decision shall be final and binding upon all parties in interest.
4.5 DEPOSIT OF REDEMPTION MONEYS OR TRUST UNITS
Redemption of Debentures shall be provided for by the Trust depositing
with the Trustee or any paying agent to the order of the Trustee, on or before
11:00 a.m. Toronto time on the Business Day immediately prior to the Redemption
Date specified in such notice, such sums of money, or certificates representing
such Trust Units, as the case may be, as may be sufficient to pay the Redemption
Price of the Debentures so called for redemption, plus accrued interest thereon
up to but excluding the Redemption Date, provided the Trust may elect to satisfy
this requirement by providing the Trustee with a certified cheque for such
amounts required under this Section 4.5 post-dated to the Redemption Date or by
an electronic funds transfer of such funds on the Redemption Date. At the
request of the Trustee, the Trust shall also deposit with the Trustee a sum of
money sufficient to pay any charges or expenses which may be incurred by the
Trustee in connection with such redemption. Every such deposit shall be
irrevocable. From the sums so deposited, the Trustee shall pay or cause to be
paid, or issue or cause to be issued, to Debentureholders of such Debentures so
called for redemption, upon surrender of such Debentures, the principal and
premium (if any) to which they are respectively entitled on redemption. The
Trust may pay the interest hereunder in accordance with Article 11.
4.6 RIGHT TO REPAY REDEMPTION PRICE IN TRUST UNITS
(a) Subject to the other provisions of this Section 4.6, the Trust may, at
its option, in exchange for or in lieu of paying the Redemption Price
in money, elect to satisfy its obligation to pay the Redemption Price,
in whole or in part, by issuing and
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delivering to the Debentureholders on the Redemption Date that number
of Freely Tradeable Trust Units obtained by dividing the aggregate
Redemption Price by 95% of the then Current Market Price of the Trust
Units on the Redemption Date (the "UNIT REDEMPTION RIGHT").
(b) The Trust shall exercise the Unit Redemption Right by so specifying in
the Redemption Notice, which shall be delivered to the Trustee and the
Debentureholders not more than 60 days and not less than 30 days prior
to the Redemption Date.
(c) The Trust's right to exercise the Unit Redemption Right shall be
conditional upon the following conditions being met on the Business
Day preceding the Redemption Date:
(i) the qualification of the Trust Units to be issued on exercise of
the Unit Redemption Right as Freely Tradeable;
(ii) the listing of such additional Trust Units on each stock
exchange on which the Trust Units are then listed;
(iii) the Trust being a reporting issuer (or its equivalent) in good
standing under Applicable Securities Legislation where the
distribution of such Trust Units occurs;
(iv) no Event of Default shall have occurred and be continuing;
(v) the receipt by the Trustee of an Officer's Certificate stating
that conditions (i), (ii), (iii) and (iv) above have been
satisfied and setting forth the number of Trust Units to be
delivered for each $1,000 principal amount of Debentures and the
Current Market Price of the Trust Units on the Redemption Date;
and
(vi) the receipt by the Trustee of an opinion of Counsel to the
effect that such Trust Units have been duly authorized and, when
issued and delivered pursuant to the terms of this Indenture in
payment of the Redemption Price, will be validly issued as fully
paid, that conditions (i) and (ii) above have been satisfied and
that, relying exclusively on certificates of good standing
issued by the relevant securities authorities, condition (iii)
above is satisfied, except that the opinion in respect of
condition (iii) need not be expressed with respect to those
provinces where certificates are not issued.
If the foregoing conditions are not satisfied at or prior to the close
of business on the Business Day preceding the Redemption Date, the Trust shall
pay in cash the Redemption Price that would otherwise have been satisfied in
Trust Units in accordance with Section 4.5 unless the Debentureholder waives the
conditions which are not satisfied.
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(d) In the event that the Trust duly exercises its Unit Redemption Right,
upon presentation and surrender of the Debentures for payment on the
Redemption Date, at any place where a register is maintained pursuant
to Article 3 or any other place specified in the Redemption Notice,
the Trust shall on the Redemption Date make the delivery to the
Trustee for delivery to and on account of the Debentureholders, the
Freely Tradeable Units to which the Debentureholders are entitled and
funds representing accrued and unpaid interest (net of withholding
tax) to which such Debentureholders are entitled.
(e) No fractional Freely Tradeable Trust Units shall be delivered upon the
exercise of the Unit Redemption Right but, in lieu thereof, the Trust
shall pay to the Trustee for the account of the Debentureholders, at
the time contemplated in Section 4.6(d), the cash equivalent thereof
determined on the basis of the Current Market Price of the Trust Units
on the Redemption Date (less any tax required to be deducted, if any).
(f) A holder shall be treated as the unitholder of record of the Trust
Units issued on due exercise by the Trust of its Unit Redemption Right
effective immediately after the close of business on the Redemption
Date, and shall be entitled to all substitutions therefor, all income
earned thereon or accretions thereto and all dividends or
distributions (including unit distributions and dividends or
distributions in kind) thereon and arising thereafter, and in the
event that the Trustee receives the same, it shall hold the same in
trust for the benefit of such holder.
(g) The Trust shall issue to Debentureholders to whom Freely Tradeable
Trust Units will be issued pursuant to exercise of the Unit Redemption
Right, such number of Freely Tradeable Trust Units as shall be
issuable in such event. All Freely Tradeable Trust Units which shall
be so issuable shall be duly and validly issued as fully paid.
(h) The Trust shall comply with all Applicable Securities Legislation
regulating the issue and delivery of Freely Tradeable Trust Units upon
exercise of the Unit Redemption Right and shall cause to be listed and
posted for trading such Trust Units on each stock exchange on which
the Trust Units are then listed.
(i) The Trust shall from time to time promptly pay, or make provision
satisfactory to the Trustee for the payment of, all taxes and charges
which may be imposed by the laws of Canada or any province thereof
(except income tax, withholding tax or security transfer tax, if any)
which shall be payable with respect to the issuance or delivery of
Freely Tradeable Trust Units to Debentureholders upon exercise of the
Unit Redemption Right pursuant to the terms of the Debentures and of
this Indenture.
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(j) If the Trust elects to satisfy its obligation to pay the Redemption
Price by issuing Freely Tradeable Trust Units in accordance with this
Section 4.6 and if the Redemption Price (or any portion thereof) to
which a holder is entitled is subject to withholding taxes, the agent
of the Trust, on the Written Direction of the Trust but for the
account of the holder, may sell, through the investment banks, brokers
or dealers selected by the Trust, out of the Freely Tradeable Trust
Units issued by the Trust for this purpose, such number of Freely
Tradeable Trust Units that is sufficient to yield net proceeds (after
payment of all costs) to cover the amount of taxes required to be
withheld, and shall remit same on behalf of the Trust to the proper
tax authorities within the period of time prescribed for this purpose
under applicable laws.
(k) Each certificate representing Freely Tradeable Trust Units issued in
payment of the Redemption Price of Debentures bearing the U.S. 1933
Act Legend set forth in Section 2.14, as well as all certificates
issued in exchange for or in substitution of the foregoing Trust
Units, shall bear the U.S. 1933 Act Legend set forth in Section 2.14;
provided that if the Trust Units are being sold outside the United
States in accordance with Rule 904 of Regulation S and provided that
the Trust is a "foreign issuer" within the meaning of Regulation S at
the time of sale, the U.S. 1933 Act Legend may be removed by providing
a declaration to the Trustee, in its capacity as the trustee hereunder
and as the transfer agent for the Trust Units, as set forth in
Schedule E hereto (or as the Trust or the Trustee may prescribe from
time to time); and provided further that, if any such securities are
being sold within the United States in accordance with Rule 144 under
the 1933 Act, the U.S. 1933 Act Legend may be removed by delivery to
the Trustee, in its capacity as the trustee hereunder and as the
transfer agent for the Trust Units, of an opinion of counsel of
recognized standing, reasonably satisfactory to the Trust, to the
effect that the U.S. 1933 Act Legend is no longer required under
applicable requirements of the 1933 Act or any applicable local laws
or regulations. Provided that the Trustee obtains confirmation from
the Trust that such counsel is satisfactory to it, it shall be
entitled to rely on such opinion of counsel without further inquiry.
(l) The Trust shall at all times reserve and keep available out of its
authorized Trust Units (if the number thereof becomes limited) solely
for the purpose of issue and delivery upon the exercise of the Unit
Redemption Right as provided herein, and shall issue to
Debentureholders to whom the Trust Units will be issued pursuant to
exercise of the Units Redemption Right, such number of Trust Units as
shall be issuable in such event.
(m) Interest accrued and unpaid on the Debentures on the Redemption Date
will be paid to Debentureholders, in cash, in the manner contemplated
in Section 4.5.
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4.7 FAILURE TO SURRENDER DEBENTURES CALLED FOR REDEMPTION
In case the holder of any Debenture so called for redemption shall
fail on or before the Redemption Date to so surrender such holder's Debenture,
or shall not within such time accept payment of the Redemption Price payable, or
take delivery of certificates representing any Trust Units issuable in respect
thereof, or give such receipt therefor, if any, as the Trustee may require, such
redemption moneys may be set aside in trust (without interest), or such
certificates may be held in trust without interest, either in the deposit
department of the Trustee or in a chartered bank, and such setting aside shall
for all purposes be deemed a payment to the Debentureholder of the sum so set
aside and, to that extent, the Debenture shall thereafter not be considered as
outstanding hereunder and the Debentureholder shall have no other right except
to receive payment out of the moneys so paid and deposited, or to take delivery
of the certificates so deposited, upon surrender and delivery of such holder's
Debenture of the Redemption Price plus accrued interest and unpaid interest to
the Redemption Date and subsequent distributions, on such Trust Units, if any,
as the case may be, of such Debenture. In the event that any money, or
certificates, required to be deposited hereunder with the Trustee or any
depositary or paying agent on account of principal, premium, if any, or
interest, if any, on Debentures issued hereunder shall remain so deposited for a
period of ten years from the Redemption Date, then such moneys or certificates,
together with any accumulated interest thereon, shall at the end of such period
be paid over or delivered over by the Trustee or such depositary or paying agent
to the Trust on its demand, and thereupon the Trustee shall not be responsible
to Debentureholders for any amounts owing to them and, subject to applicable
law, thereafter the holder of a Debenture in respect of which such money was so
repaid to the Trust shall have no rights in respect thereof except to obtain
payment of the money or certificates due from the Trust, subject to any
limitation period provided by the laws of Ontario.
4.8 CANCELLATION OF DEBENTURES REDEEMED
Subject to the provisions of Sections 4.2 and 4.9 as to Debentures
redeemed or purchased in part, all Debentures redeemed and whose obligations
have been satisfied under this Article 4 shall forthwith be delivered to the
Trustee and cancelled and no Debentures shall be issued in substitution
therefor.
4.9 PURCHASE OF DEBENTURES BY THE TRUST
Unless otherwise specifically provided with respect to a particular
series of Debentures, the Trust may, provided no Event of Default has occurred
and is continuing, at any time and from time to time, purchase Debentures in the
market (which shall include purchase from or through an investment dealer or a
firm holding membership on a recognized stock exchange) or by tender or by
private contract, at any price, subject to compliance with Applicable Securities
Legislation regarding issuer bid requirements. If an Event of Default has
occurred and is continuing, the Trust may purchase all or any part of the
Debentures as aforesaid, except by private contract. All Debentures so purchased
may, at the option of the Trust, be delivered to the Trustee and shall be
cancelled and no Debentures shall be issued in substitution therefor.
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If, upon an invitation for tenders, more Debentures are tendered at
the same lowest price that the Trust is prepared to accept, the Debentures to be
purchased by the Trust shall be selected by the Trustee, in such manner (which
may include selection by lot, selection on a pro rata basis, random selection by
computer or any other method) as the Trustee considers appropriate, from the
Debentures tendered by each tendering Debentureholder who tendered at such
lowest price. For this purpose the Trustee may make, and from time to time
amend, regulations with respect to the manner in which Debentures may be so
selected, and regulations so made shall be valid and binding upon all
Debentureholders, notwithstanding the fact that as a result thereof one or more
of such Debentures become subject to purchase in part only. The holder of a
Debenture of which a part only is purchased, upon surrender of such Debenture
for payment, shall be entitled to receive, without expense to such holder, one
or more new Debentures for the unpurchased part so surrendered, and the Trustee
shall certify and deliver such new Debenture or Debentures upon receipt of the
Debenture so surrendered or, with respect to a Global Debenture, the Depositary
shall make notations on the Global Debenture of the principal amount thereof so
purchased.
4.10 RIGHT TO REPAY PRINCIPAL AMOUNT IN TRUST UNITS
(a) Subject to the other provisions of this Section 4.10, the Trust may,
at its option, in exchange for or in lieu of paying all or any portion
of the principal amount of the Debentures outstanding in money, elect
to satisfy its obligation to repay all or any portion of the principal
amount of the Debentures outstanding by issuing and delivering to
Debentureholders on the maturity of such Debentures (the "MATURITY
DATE") that number of Freely Tradeable Trust Units obtained by
dividing the aggregate principal amount of the Debentures in respect
of which such election is made by 95% of the Current Market Price of
the Trust Units on the Maturity Date (the "UNIT REPAYMENT RIGHT").
(b) The Trust shall exercise the Unit Repayment Right by so specifying in
the Maturity Notice set forth in Schedule "C", which shall be
delivered to the Trustee and the Debentureholders not more than 60
days and not less than 40 days prior to the Maturity Date.
(c) The Trust's right to exercise the Unit Repayment Right shall be
conditional upon the following conditions being met on the Business
Day preceding the Maturity Date:
(i) the qualification of the Trust Units to be issued on exercise of
the Unit Repayment Right as Freely Tradeable;
(ii) the listing of such additional Trust Units on each stock
exchange on which the Trust Units are then listed;
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(iii) the Trust being a reporting issuer (or its equivalent) in good
standing under Applicable Securities Legislation where the
distribution of such Trust Units occurs;
(iv) no Event of Default shall have occurred and be continuing;
(v) the receipt by the Trustee of an Officer's Certificate stating
that conditions (i), (ii), (iii) and (iv) above have been
satisfied and setting forth the number of Trust Units to be
delivered for each $11,000 principal amount of Debentures and
the Current Market Price of the Trust Units on the Maturity
Date; and
(vi) the receipt by the Trustee of an opinion of Counsel to the
effect that such Trust Units have been duly authorized and, when
issued and delivered pursuant to the terms of this Indenture in
payment of the principal amount of the Debentures outstanding
will be validly issued as fully paid, that conditions (i) and
(ii) above have been satisfied and that, relying exclusively of
certificates of good standing issued by the relevant securities
authorities, condition (iii) above is satisfied, except that the
opinion in respect of condition (iii) need not be expressed with
respect to those provinces where certificates are not issued.
If the foregoing conditions are not satisfied prior to the close of
business on the Business Day preceding the Maturity Date, the Trust shall pay in
cash 100% of the principal amount of the Debentures that would otherwise have
been payable in accordance with Section 2.13, unless the Debentureholder waives
the conditions which are not satisfied.
(d) In the event that the Trust duly exercises its Unit Repayment Right,
upon presentation and surrender of the Debentures for payment on the
Maturity Date, at any place where a register is maintained pursuant to
Article 3 or any other place specified in the Maturity Notice, the
Trust shall on the Maturity Date make the delivery to the Trustee for
delivery to and on account of the holders of certificates representing
the Freely Tradeable Trust Units and funds representing accrued and
unpaid interest (net of withholding tax) to which such holders are
entitled.
(e) No fractional Freely Tradeable Trust Units shall be delivered upon the
exercise of the Unit Repayment Right but, in lieu thereof, the Trust
shall pay to the Trustee for the account of the holders, at the time
contemplated in Section 4.10(d), the cash equivalent thereof
determined on the basis of the Current Market Price of the Trust Units
on the Maturity Date (less any tax required to be deducted, if any).
(f) A holder shall be treated as the unitholder of record of the Freely
Tradeable Trust Units issued on due exercise by the Trust of its Unit
Repayment Right effective immediately after the close of business on
the Maturity Date, and shall be entitled to all substitutions
therefor, all income earned thereon or accretions thereto and all
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dividends or distributions (including unit distributions and dividends
or distributions in kind) thereon and arising thereafter, and in the
event that the Trustee receives the same, it shall hold the same in
trust for the benefit of such holder.
(g) The Trust shall issue to Debentureholders to whom Freely Tradeable
Trust Units will be issued pursuant to exercise of the Unit Repayment
Right, such number of Freely Tradeable Trust Units as shall be
issuable in such event. All Freely Tradeable Trust Units which shall
be so issuable shall be duly and validly issued as fully paid and
non-assessable.
(h) The Trust shall comply with all Applicable Securities Legislation
regulating the issue and delivery of Freely Tradeable Trust Units upon
exercise of the Unit Repayment Right and shall cause to be listed and
posted for trading such Trust Units on each stock exchange on which
the Trust Units are then listed.
(i) The Trust shall from time to time promptly pay, or make provision
satisfactory to the Trustee for the payment of, all taxes and charges
which may be imposed by the laws of Canada or any province thereof
(except income tax, withholding tax or security transfer tax, if any)
which shall be payable with respect to the issuance or delivery of
Freely Tradeable Trust Units to holders upon exercise of the Unit
Repayment Right pursuant to the terms or the Debentures and of this
Indenture.
(j) If the Trust elects to satisfy its obligation to pay all or any
portion of the principal amount on maturity by issuing Freely
Tradeable Trust Units in accordance with this Section 4.10 and if the
principal amount (or any portion thereof) to which a holder is
entitled is subject to withholding taxes, the agent of the Trust, on
the Written Direction of the Trust but for the account of the holder,
shall sell, through the investment banks, brokers or dealers selected
by the Trust, out of the Freely Tradeable Trust Units issued by the
Trust for this purpose, such number of Freely Tradeable Trust Units
that is sufficient to yield net proceeds (after payment of all costs)
to cover the amount of taxes required to be withheld, and shall remit
same on behalf of the Trust to the proper tax authorities within the
period of time prescribed for this purpose under applicable laws.
(k) Each certificate representing Freely Tradeable Trust Units issued in
payment of the principal amount of Debentures bearing the U.S. 1933
Act Legend set forth in Section 2.14, as well as all certificates
issued in exchange for or in substitution of the foregoing Trust
Units, shall bear the U.S. 1933 Act Legend set forth in Section 2.14;
provided that if the Trust Units are being sold outside the United
States in accordance with Rule 904 of Regulation S and provided that
the Trust is a "foreign issuer" within the meaning of Regulation S at
the time of the sale, the U.S. 1933 Act Legend may be removed by
providing a declaration to the Trustee, in its capacity as the
transfer agent for the Trust Units, as set forth in Schedule E hereto
(or as the Trust or the Trustee may prescribe from time to time); and
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provided, further that, if any such securities are being sold within
the United States in accordance with Rule 144 under the 1933 Act, the
U.S. 1933 Act Legend may be removed by delivery to the Trustee, in its
capacity as the transfer agent for the Trust Units, of an opinion of
counsel of recognized standing, reasonably satisfactory to the Trust,
that the U.S. 1933 Act Legend is no longer required under applicable
requirements of the 1933 Act or any applicable local laws and
regulations. Provided that the Trustee obtains confirmation from the
Trust that such counsel is satisfactory to it, it shall be entitled to
rely on such opinion of counsel without further inquiry.
(l) The Trust shall at all times reserve and keep available out of its
authorized Trust Units (if the number thereof becomes limited) solely
for the purpose of issue and delivery upon the exercise of the Unit
Repayment Right as provided herein, and shall issue to
Debentureholders to whom the Trust Units will be issued pursuant to
exercise of the Units Repayment Right, such number of Trust Units as
shall be issuable in such event.
4.11 RIGHT TO PAY ALL AMOUNTS IN TRUST UNITS
Notwithstanding any other provision in the Indenture, for greater
certainty the Trust shall have the right, at its option, but subject to the
prior approval of the TSX and any other applicable regulatory approval, to elect
to: (i) repay the principal amount of the Debentures outstanding, in whole or in
part, whether as a result of a redemption, maturity of the Debentures or
otherwise, by issuing and delivering to Debentureholders Freely Tradeable Trust
Units in accordance with the terms of this Indenture, and (ii) issue and deliver
to the agent of the Trust Freely Tradeable Trust Units for sale in accordance
with the terms of this Indenture to raise funds to be used to satisfy the
Trust's Interest Obligations under the Debentures.
ARTICLE 5
SUBORDINATION OF DEBENTURES
5.1 APPLICABILITY OF ARTICLE
The indebtedness, liabilities and obligations of the Trust evidenced
by any Debentures issued hereunder of any series which by their terms are
subordinate, whether on account of principal, interest or otherwise, but
excluding the obligation to issue Trust Units or other securities similar in
nature thereto upon any conversion pursuant to Article 6, upon any redemption
pursuant to Article 4, or at maturity pursuant to Article 4 (collectively, the
"SUBORDINATED DEBENTURE LIABILITIES"), shall be subordinated and postponed and
subject in right of payment, to the extent and in the manner hereinafter set
forth in the following sections of this Article 5, to the prior payment in full,
of all Senior Indebtedness of the Trust and each holder of any such Debenture by
his acceptance thereof agrees to and shall be bound by the provisions of this
Article 5.
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5.2 ORDER OF PAYMENT
Upon any distribution of the assets of the Trust on any dissolution,
winding up, liquidation, bankruptcy, insolvency, receivership, creditor
enforcement or realization of other similar proceeding relating to the Trust or
any of its property (whether voluntary or involuntary, partial or complete or
any other marshalling of the assets and liabilities of the Trust, or any sale of
all or substantially all of the assets of the Trust):
(a) all Senior Indebtedness shall first be paid in full, or provision made
for such payment, before any payment is made on account of the
principal of or interest on the indebtedness evidenced by the
Debentures; and
(b) any payment or distribution of assets of the Trust, whether in cash,
property or securities, to which the Debentureholders or the Trustee
on behalf of such Debentureholders would be entitled except for the
provisions of this Article 5, shall be paid or delivered by the
trustee in bankruptcy, receiver, assignee for the benefit of
creditors, or other liquidating agent making such payment or
distribution, directly to the holders of Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under
any indenture pursuant to which any instruments evidencing any of such
Senior Indebtedness may have been issued, to the extent necessary to
pay all Senior Indebtedness in full after giving effect to any
concurrent payment or distribution, or provision therefor, to the
holders of such Senior Indebtedness.
(c) the Senior Creditors or a receiver or a receiver-manager of the Trust
or of all or part of its assets or any other enforcement agent may
sell, mortgage, or otherwise dispose of the Trust assets in whole or
in part, free and clear of all Subordinated Debenture Liabilities and
without the approval of such Debentureholders or the Trustee or any
requirement to account to the Trustee or to such Debentureholders.
The rights and priority of the Senior Indebtedness as provided for herein and
any subordination pursuant hereto shall not be affected by:
(a) the time, sequence or order of creating, granting, executing,
delivering of, or registering, perfecting or failing to register or
perfect any security notice, caveat, financing statement or other
notice in respect of the Senior Security;
(b) the time or order of the attachment, perfection or crystallization of
any security constituted by the Senior Security;
(c) the taking of any collection, enforcement or realization proceedings
pursuant to the Senior Security;
(d) the date of obtaining of any judgment or order of any bankruptcy court
or any court administering bankruptcy, insolvency or similar
proceedings as to the
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entitlement of the Senior Creditors, or any of them or the
Debentureholders or other trustees or any of them to any money or
property of the Trust;
(e) the failure to exercise any power or remedy reserved to the Senior
Creditors under the Senior Security or to insist upon a strict
compliance with any terms thereof;
(f) whether any Senior Security is now perfected, hereafter ceases to be
perfected, is avoidable by any trustee in bankruptcy or like official
or is otherwise set aside, invalidated or lapses;
(g) the date of giving or failing to give notice to or making demand upon
the Trust or the Manager; or
(h) the priorities otherwise afforded under applicable laws or any other
matter whatsoever.
5.3 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS
Subject to the prior payment in full of all Senior Indebtedness, the
Debentureholders shall be subrogated to the rights of the holders of Senior
Indebtedness to receive payments or distributions of assets of the Trust to the
extent of the application thereto of such payments or other assets which would
have been received by the Debentureholders but for the provisions hereof until
the principal of and interest on the Debentures shall be paid in full, and no
such payments or distributions to the Debentureholders of cash, property or
securities, which otherwise would be payable or distributable to the holders of
the Senior Indebtedness, shall, as between the Trust, its creditors other than
the holders of Senior Indebtedness, and the Debentureholders, be deemed to be a
payment by the Trust to the holders of the Senior Indebtedness or on account of
the Senior Indebtedness, it being understood that the provisions of this Article
5 are and are intended solely for the purpose of defining the relative rights of
the Debentureholders, on the one hand, and the holders of Senior Indebtedness,
on the other hand. The Trustee, for itself and on behalf of each of the
Debentureholders, hereby waives any and all rights to require a Senior Creditor
to pursue or exhaust any rights or remedies with respect to the Trust or any
property and assets subject to the Senior Security or in any other manner to
require the marshalling of property, assets or security in connection with the
exercise by the Senior Creditors of any rights, remedies or recoveries available
to them.
5.4 OBLIGATION TO PAY NOT IMPAIRED
Nothing contained in this Article 5 or elsewhere in this Indenture or
in the Debentures is intended to or shall impair, as between the Trust, its
creditors other than the holders of Senior Indebtedness, and the
Debentureholders, the obligation of the Trust, which is absolute and
unconditional, to pay to the Debentureholders the principal of and interest on
the Debentures, as and when the same shall become due and payable in accordance
with their terms, or affect the relative rights of the Debentureholders and
creditors of the Trust other than the holders of the Senior Indebtedness, nor
shall anything herein or therein prevent the Trustee or the
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Debentureholder from exercising all remedies otherwise permitted by applicable
law upon default under this Indenture, subject to the rights, if any, under this
Article 5 of the holders of Senior Indebtedness in respect of cash, property or
securities of the Trust received upon the exercise of any such remedy.
5.5 NO PAYMENT IF SENIOR INDEBTEDNESS IN DEFAULT
Neither the Trustee nor the Debentureholders shall be entitled to
demand or otherwise attempt to enforce in any manner, institute proceedings for
the collection of, or institute any proceedings against the Trust including,
without limitation, by way of any bankruptcy, insolvency or similar proceedings
or any proceeding for the appointment of a receiver, liquidator, trustee or
other similar official (it being understood and agreed that the Trustee and/or
the Debentureholders shall be permitted to take any steps necessary to preserve
the claims of the Debentureholders in any such proceeding and any steps
necessary to prevent the extinguishment or other termination of a claim or
potential claim as a result of the expiry of a limitation period), or receive
any payment or benefit in any manner whatsoever on account of indebtedness
represented by the Debentures at any time when (1) an event of default
(howsoever designated) has occurred and is continuing under a credit agreement
with a Senior Creditor, or (2) an event of default (howsoever designated) has
occurred under any other Senior Indebtedness and is continuing and, in each
case, notice of such event of default has been given by or on behalf of the
lender or lenders party to such Senior Indebtedness to the Trust or an Affiliate
thereof that is the borrower pursuant to such Senior Indebtedness.
5.6 PAYMENT ON DEBENTURES PERMITTED
Nothing contained in this Article 5 or elsewhere in this Indenture, or
in any of the Debentures, shall affect the obligation of the Trust to make, or
prevent the Trust from making, at any time except during the pendency of any
dissolution, winding up or liquidation of the Trust or other proceedings
specified in Section 5.2 or in the circumstances contemplated by Section 5.5
affecting the affairs of the Trust, any payment of principal of or interest on
the Debentures. The fact that any such payment is prohibited or any action may
not be taken under this Article 5 or under any instrument relating to Senior
Indebtedness, shall not prevent the failure to make such payment from being an
Event of Default hereunder. Nothing contained in this Article 5 or elsewhere in
this Indenture, or in any of the Debentures, shall prevent the conversion of the
Debentures or, subject to Sections 5.2 or 5.5 or the application by the Trustee
of any moneys deposited with the Trustee hereunder for the purpose, to the
payment of or on account of the principal of, or premium, if any, or interest,
if any, on the Debentures. Notwithstanding the provisions of this Article 5 or
any provision in this Indenture or in the Debentures contained, the Trustee
shall not be charged with knowledge of the existence of any Senior Indebtedness
or of any default in the payment thereof, unless and until the Trustee shall
have received written notice thereof from the Trust or from the holder of Senior
Indebtedness or from the representative of any such holder.
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5.7 CONFIRMATION OF SUBORDINATION
Each holder of Debentures by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination as provided in this Article 5 and
appoints the Trustee his attorney-in-fact for any and all such purposes. Upon
request of the Trust, and upon being furnished an Officer's Certificate stating
that one or more named Persons are holders of Senior Indebtedness, or the
representative or representatives of such holders, or the trustee or trustees or
other representative or representatives under which any instrument evidencing
such Senior Indebtedness may have been issued, and specifying the amount and
nature of such Senior Indebtedness, the Trustee shall enter into a written
agreement or agreements with the Trust and the Person or Persons named in such
Officer's Certificate, providing that such Person or Persons are entitled to all
the rights and benefits of this Article 5 as the holder or holders,
representative or representatives, or trustee or trustees of the Senior
Indebtedness specified in such Officer's Certificate and in such agreement. Such
agreement shall be conclusive evidence that the indebtedness specified therein
is Senior Indebtedness, however, nothing herein shall impair the rights of any
holder of Senior Indebtedness who has not entered into such an agreement.
5.8 KNOWLEDGE OF TRUSTEE
Notwithstanding the provisions of this Article 5, the Trustee will not
be charged with knowledge of the existence of any fact that would prohibit the
making of any payment of moneys to or by the Trustee, or the taking of any other
action by the Trustee, unless and until the Trustee has received written notice
thereof from the Trust, any Debentureholder or any holder or representative of
any class of Senior Indebtedness or on its behalf.
5.9 TRUSTEE MAY HOLD SENIOR INDEBTEDNESS
The Trustee is entitled to all the rights set forth in this Article 5
with respect to any Senior Indebtedness at the time held by it or for which it
acts as trustee, to the same extent as any other holder of Senior Indebtedness,
and nothing in this Indenture deprives the Trustee of any of its rights as such
holder.
5.10 RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS NOT IMPAIRED
No right of any present or future holder of any Senior Creditor (or
any representative on behalf of any such holder) to enforce the subordination
and postponement herein will at any time or in any way be prejudiced or impaired
by any act or failure to act on the part of the Trust or by any non-compliance
by the Trust with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof which any such Senior Creditor may have or
be otherwise charged with.
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5.11 ALTERING THE SENIOR INDEBTEDNESS
The holders of the Senior Indebtedness have the right to extend,
renew, modify or amend the terms of the Senior Indebtedness in any manner
whatsoever or any security therefor and to release, sell or exchange such
security and otherwise to deal freely with the Trust, all without notice to or
consent of the Debentureholders or the Trustee and without affecting the
liabilities and obligations of the parties to this Indenture, or the
Debentureholders or the Trustee or affecting the rights of the holders of any
Senior Indebtedness (or any representative of any such holder) or the Senior
Creditors, under this Indenture.
5.12 ADDITIONAL INDEBTEDNESS
This Indenture does not, and shall not, restrict the Trust from
incurring additional Senior Indebtedness at any time or from time to time or
other indebtedness or otherwise or mortgaging, pledging or charging its real or
personal property or properties to secure any indebtedness or other financing.
5.13 RIGHT OF DEBENTUREHOLDER TO CONVERT NOT IMPAIRED
The subordination of the Debentures to the Senior Indebtedness and the
provisions of this Article 5 do not impair in any way the right of a
Debentureholder to convert its Debentures pursuant to Article 6.
ARTICLE 6
CONVERSION OF DEBENTURES
6.1 APPLICABILITY OF ARTICLE
Any Debentures issued hereunder of any series which by their terms are
convertible (subject, however, to any applicable restriction of the conversion
of Debentures of such series) will be convertible into Trust Units or other
securities, at such conversion rate or rates, and on such date or dates and in
accordance with such other provisions as shall have been determined at the time
of issue of such Debentures and shall have been expressed in this Indenture, in
such Debentures, in an Officer's Certificate, or in a supplemental indenture
authorizing or providing for the issue thereof.
Such right of conversion shall extend only to the maximum number of
whole Trust Units into which the aggregate principal amount of the Debenture or
Debentures surrendered for conversion at any one time by the holder thereof may
be converted. Fractional interests in Trust Units shall be adjusted for in the
manner provided in Section 6.6.
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6.2 NOTICE OF EXPIRY OF CONVERSION PRIVILEGE
Notice of the expiry of the conversion privileges of the Debentures in
all cases other than on the Maturity Date shall be given by or on behalf of the
Trust, not more than 60 days and not less than 30 days prior to the date fixed
for the Time of Expiry, in the manner provided in Section 15.2.
6.3 REVIVAL OF RIGHT TO CONVERT
If the redemption of any Debenture called for redemption by the Trust
is not made or the payment of the purchase price of any Debenture which has been
tendered pursuant to the Put Right in acceptance of an offer by the Trust to
purchase Debentures for cancellation is not made, in the case of a redemption
upon due surrender of such Debenture or in the case of a purchase on the date on
which such purchase is required to be made, as the case may be, then, provided
the Time of Expiry has not passed, the right to convert such Debentures shall
revive and continue as if such Debenture had not been called for redemption or
tendered in acceptance of the Trust's offer, respectively.
6.4 MANNER OF EXERCISE OF RIGHT TO CONVERT
(a) The holder of a Debenture desiring to convert such Debenture in whole
or in part into Trust Units shall surrender such Debenture to the
Trustee at the Designated Office together with the conversion form on
the back of such Debenture or any other written notice in a form
satisfactory to the Trustee, in either case duly executed by the
holder or his executors or administrators or other legal
representatives or his or their attorney duly appointed by an
instrument in writing in form and executed in a manner satisfactory to
the Trustee, exercising his right to convert such Debenture in
accordance with the provisions of this Article; provided that with
respect to a Global Debenture, the obligation to surrender a Debenture
to the Trustee shall be satisfied if the Trustee makes notation on the
Global Debenture of the principal amount thereof so converted and the
Trustee is provided with all other documentation which it may request.
Thereupon such Debentureholder or, subject to payment of all
applicable stamp or security transfer taxes or other governmental
charges and compliance with all reasonable requirements of the
Trustee, his nominee(s) or assignee(s), shall be entitled to be
entered in the books of the Trust as at the Date of Conversion (or
such later date as is specified in Section 6.4(b)) as the holder of
the number of Trust Units into which such Debenture is convertible in
accordance with the provisions of this Article and, as soon as
practicable thereafter, the Trust shall deliver to such
Debentureholder or, subject as aforesaid, his nominee(s) or
assignee(s), a certificate or certificates for such Trust Units and
make or cause to be made any payment of interest to which such
Debentureholders is entitled in accordance with Section 6.4(e) hereof.
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(b) For the purposes of this Article, a Debenture shall be deemed to be
surrendered for conversion on the date (herein called the "DATE OF
CONVERSION") on which it is so surrendered in accordance with the
provisions of this Article and, in the case of a Debenture so
surrendered by post or other means of transmission, on the date on
which it is received by the Trustee at one of its offices specified in
Section 6.4(a); provided that if a Debenture is surrendered for
conversion on a day on which the register of Trust Units is closed,
the Person or Persons entitled to receive Trust Units shall become the
holder or holders of record of such Trust Units as at the date on
which such registers are next reopened.
(c) Any part, being $1,000 or an integral multiple thereof, of a Debenture
in a denomination in excess of $1,000 may be converted as provided in
this Article and all references in this Indenture to conversion of
Debentures shall be deemed to include conversion of such parts.
(d) Any Debentureholder of which only a part is converted shall, upon the
exercise of his or her right of conversion surrender the said
Debenture to the Trustee, and the Trustee shall cancel the same and
shall without charge forthwith certify and deliver to the
Debentureholder a new Debenture or Debentures in an aggregate
principal amount equal to the unconverted part of the principal amount
of the Debenture so surrendered or, with respect to a Global
Debenture, the Trustee shall make notations on the Global Debenture of
the principal amount thereof so converted.
(e) The Debentureholder of a Debenture surrendered for conversion in
accordance with this Section 6.4 shall be entitled (subject to any
applicable restriction or the right to receive interest on conversion
of the Debentures of any series) to receive accrued and unpaid
interest in respect thereof (net of withholding taxes) from and
including the last Interest Payment Date, up to but excluding the Date
of Conversion of such Debenture and the Trust Units issued upon such
conversion shall rank only in respect of distributions or dividends
declared in favour of unit holders of record on and after the Date of
Conversion or such later date as such holder shall become the holder
of record of such Trust Units pursuant to Section 6.4(b), from which
applicable date they will for all purposes be and be deemed to be
issued and outstanding as fully paid and non-assessable Trust Units.
6.5 ADJUSTMENT OF CONVERSION PRICE
The Conversion Price in effect at any date shall be subject to
adjustment from time to time as follows:
(a) If and whenever at any time prior to the Time of Expiry the Trust
shall (i) subdivide or redivide the outstanding Trust Units into a
greater number of units, (ii) reduce, combine or consolidate the
outstanding Trust Units into a smaller number of units, or (iii) issue
Trust Units or securities convertible into or
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exchangeable for Trust Units to the holders of all or substantially
all of the outstanding Trust Units by way of a dividend or
distribution (other than the issue of Trust Units to holders of Trust
Units who have elected to receive dividends or distributions in the
form of Trust Units in lieu of cash dividends or cash distributions
paid in the ordinary course), the Conversion Price in effect on the
effective date of such subdivision, redivision, reduction, combination
or consolidation or on the record date for such issue of Trust Units
by way of a dividend or distribution, as the case may be, shall in the
case of any of the events referred to in (i) and (iii) above be
decreased in proportion to the number of outstanding Trust Units
resulting from such subdivision, redivision, dividend or distribution
(including, in the case which securities convertible into or
exchangeable for Trust Units are distributed, the number of Trust
Units that would have been outstanding had all such securities been
exchanged for or converted into Trust Units on such effective date or
record date), or shall, in the case of any of the events referred to
in (ii) above, be increased in proportion to the number of outstanding
Trust Units resulting from such reduction, combination or
consolidation. Such adjustment shall be made successively whenever any
event referred to in this Section 6.5(a) shall occur. Any such issue
of Trust Units by way of a dividend or distribution shall be deemed to
have been made on the record date for the dividend or distribution for
the purpose of calculating the number of outstanding Trust Units under
subsections (b) and (c) of this Section 6.5.
(b) If and whenever at any time prior to the Time of Expiry the Trust
shall fix a record date for the issuance of options, rights or
warrants to all or substantially all the holders of its outstanding
Trust Units entitling them, for a period expiring not more than 45
days after such record date, to subscribe for or purchase Trust Units
(or securities convertible or exchangeable into Trust Units) at a
price per unit (or having a conversion or exchange price per unit)
less than 95% of the Current Market Price of a Trust Unit on such
record date, the Conversion Price shall be adjusted immediately after
such record date so that it shall equal the price determined by
multiplying the Conversion Price in effect on such record date by a
fraction, of which the numerator shall be the total number of Trust
Units outstanding on such record date plus a number of Trust Units
equal to the number arrived at by dividing the aggregate price of the
total number of additional Trust Units offered for subscription or
purchase (or the aggregate conversion or exchange price of the
convertible or exchangeable securities so offered) by such Current
Market Price per Trust Unit, and of which the denominator shall be the
total number of Trust Units outstanding on such record date plus the
total number of additional Trust Units offered for subscription or
purchase (or into which the convertible or exchangeable securities so
offered are convertible or exchangeable). Such adjustment shall be
made successively whenever such a record date is fixed. To the extent
that any such options, rights or warrants are not so issued or any
such options, rights or warrants are not exercised prior to the
expiration thereof, the Conversion Price shall be re-adjusted to the
Conversion
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Price which would then be in effect if such record date had not been
fixed or to the Conversion Price which would then be in effect based
upon the number of Trust Units (or securities convertible or
exchangeable into Trust Units) actually issued upon the exercise of
such options, rights or warrants, as the case may be.
(c) If and whenever at any time prior to the Time of Expiry the Trust
shall fix a record date for the making of a distribution to all or
substantially all the holders of its outstanding Trust Units of (i)
units of any class other than Trust Units and other than units
distributed to holders of Trust Units who have elected to receive
dividends or distributions in the form of such units in lieu of
dividends or distributions paid in the ordinary course, (ii) rights,
options or warrants (excluding rights, options or warrants entitling
the holders thereof for a period of not more than 45 days to subscribe
for or purchase Trust Units or securities convertible into Trust
Units), (iii) evidences of its indebtedness, or (iv) other securities
(excluding rights, options or warrants entitling the holders thereof
for a period of not more than 45 days to subscribe for or purchase
Units or securities convertible into Units) or assets (excluding
dividends or distributions paid in the ordinary course) then, in each
such case, the Conversion Price shall be adjusted immediately after
such record date so that it shall equal the price determined by
multiplying the Conversion Price in effect on such record date by a
fraction, of which the numerator shall be the total number of Trust
Units outstanding on such record date multiplied by the Current Market
Price per Trust Unit on such record date, less the fair market value
(as determined by the Board of Directors, which determination shall be
conclusive) of such units or rights, options or warrants or evidences
or indebtedness or assets so distributed, and of which the denominator
shall be the total number of Trust Units outstanding on such record
date multiplied by such Current Market Price per Trust Unit. Such
adjustment shall be made successively whenever such a record date is
fixed. To the extent that such distribution is not so made, the
Conversion Price shall be re-adjusted to the Conversion Price which
would then be in effect if such record date had not been fixed or to
the Conversion Price which would then be in effect based upon such
units or rights, options or warrants or evidences of indebtedness or
assets actually distributed, as the case may be. In clause (iv) of
this subsection (c), the term "dividends or distributions paid in the
ordinary course" shall include the value of any security or other
property or assets distributed in lieu of cash dividends or
distributions paid in the ordinary course at the option of the
unitholders.
(d) If and whenever at any time prior to the Time of Expiry, there is a
reclassification of the Trust Units or a capital reorganization of the
Trust other than as described in Section 6.5(a) or a consolidation,
amalgamation, arrangement or merger of the Trust with or into any
other Person or other entity; or a sale or conveyance of the property
and assets of the Trust as an entirety or substantially as an entirety
to any other Person or other entity or a liquidation, dissolution or
winding-up of the Trust, any Debentureholder who has not exercised its
right of conversion prior to the effective date of such
reclassification, capital reorganization, consolidation,
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amalgamation, arrangement or merger, sale or conveyance or
liquidation, dissolution or winding-up, upon the exercise of such
right thereafter, shall be entitled to receive and shall accept, in
lieu of the number of Trust Units then sought to be acquired by it,
the number of trust units, shares or other securities or property of
the Trust or of the Person or other entity resulting from such merger,
amalgamation, arrangement or consolidation, or to which such sale or
conveyance may be made or which holders of Trust Units receive
pursuant to such liquidation, dissolution or winding-up, as the case
may be, that such Debentureholder would have been entitled to receive
on such reclassification, capital reorganization, consolidation,
amalgamation, arrangement or merger, sale or conveyance or
liquidation, dissolution or winding-up, if, on the record date or the
effective date thereof, as the case may be, the holder had been the
registered holder of the number of Trust Units sought to be acquired
by it and to which it was entitled to acquire upon the exercise of the
conversion right. If determined appropriate by the Board of Directors
on behalf of the Trust to give effect to or to evidence the provisions
of this Section 6.5(d), the Trust, its successor, or such purchasing
Person or other entity, as the case may be, shall, prior to or
contemporaneously with any such reclassification, capital
reorganization, consolidation, amalgamation, arrangement, merger, sale
or conveyance or liquidation, dissolution or winding-up enter into an
indenture which shall provide, to the extent possible, for the
application of the provisions set forth in this Indenture with respect
to the rights and interests thereafter of the Debentureholder to the
end that the provisions set forth in this Indenture shall thereafter
correspondingly be made applicable, as nearly as may reasonably be
practicable, with respect to any trust units, shares or other
securities or property to which a Debentureholder is entitled on the
exercise of its conversion rights thereafter. Any indenture entered
into between the Trust and the Trustee pursuant to the provisions of
this Section 6.5(d) shall be a supplemental indenture entered into
pursuant to the provisions of Article 17 hereof. Any indenture entered
into between the Trust, any successor to the Trust or such purchasing
Person or other entity and the Trustee shall provide for adjustments
which shall be as nearly equivalent as may be practicable to the
adjustments provided in this Section 6.5(d) and which shall apply to
successive, reclassifications, capital reorganizations, amalgamations,
consolidations, mergers, sales or conveyances or to a liquidation,
dissolution or winding-up.
(e) In any case in which this Section 6.5 shall require that an adjustment
shall become effective immediately after a record date for an event
referred to herein, the Trust may defer, until the occurrence of such
event, issuing to the Debentureholder converted after such record date
and before the occurrence of such event the additional Trust Units
issuable upon such conversion by reason of the adjustment required by
such event before giving effect to such adjustment; provided, however,
that the Trust shall deliver to such Debentureholder an appropriate
instrument evidencing such Debentureholder's right to receive such
additional Trust Units upon the occurrence of the event requiring such
adjustment and the
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right to receive any distributions made on such additional Trust Units
declared in favour of holders of record of Trust Units on and after
the Date of Conversion or such later date as such holder would, but
for the provisions of this Section 6.5(e), have become the holder of
record of such additional Trust Units pursuant to Section 6.4(b).
(f) The adjustments provided for in this Section 6.5 are cumulative and
shall apply to successive subdivisions, redivisions, reductions,
combinations, consolidations, distributions, issues or other events
resulting in any adjustment under the provisions of this Section,
provided that, notwithstanding any other provision of this Section, no
adjustment of the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in the
Conversion Price then in effect; provided however, that any
adjustments which by reason of this Section 6.5(f) are not required to
be made shall be carried forward and taken into account in any
subsequent adjustment.
(g) For the purpose of calculating the number of Trust Units of the Trust
outstanding, Trust Units owned by or for the benefit of the Trust
shall not be counted.
(h) In the event of any question arising with respect to the adjustments
provided in this Section 6.5, such question shall be conclusively
determined by a firm of chartered accountants appointed by the Trust
and acceptable to the Trustee (who may be the Auditors of the Trust);
such accountants shall have access to all necessary records of the
Trust and such determination shall be binding upon the Trust, the
Trustee, and the Debentureholders.
(i) In case the Trust shall take any action affecting the Trust Units
other than action described in this Section 6.5, which in the opinion
of the Board of Directors on behalf of the Trust would materially
adversely affect the rights of Debenturehoiders, the Conversion Price
shall be adjusted in such manner and at such time, by action of the
trustees, subject to the prior written consent of the TSX, as the
Board of Directors on behalf of the Trust in their sole discretion may
determine to be equitable in the circumstances. Failure of the Board
of Directors on behalf of the Trust to make such an adjustment shall
be conclusive evidence that the trustees have determined that it is
equitable to make no adjustment in the circumstances.
(j) Subject to the prior written consent of the TSX, no adjustment in the
Conversion Price shall be made in respect of any event described in
Sections 6.5(a), 6.5(b) or 6.5(c) other than the events described in
6.5(a)(i) or 6.5(a)(ii) if the Debentureholders are entitled to
participate in such event on the same terms mutatis mutandis as if
they had converted their Debentures prior to the effective date or
record date, as the case may be, of such event.
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(k) Except as stated above in this Section 6.5, no adjustment will be made
in the Conversion Price for any Debentures as a result of the issuance
of Trust Units at less than the Current Market Price for such Trust
Units on the date of issuance of the then applicable Conversion Price.
6.6 NO REQUIREMENT TO ISSUE FRACTIONAL UNITS
The Trust shall not be required to issue fractional Trust Units upon
the conversion of Debentures pursuant to this Article. If more than one
Debenture shall be surrendered for conversion at one time by the same
Debentureholder, the number of whole Trust Units issuable upon conversion
thereof shall be computed on the basis of the aggregate principal amount of such
Debentures to be converted. If any fractional interest in a Trust Unit would,
except for the provisions of this Section, be deliverable upon the conversion of
any principal amount of Debentures, the Trust shall, in lieu of delivering any
certificate representing such fractional interest, make a cash payment to the
Debentureholder of such Debenture of an amount equal to the fractional interest
which would have been issuable multiplied by the Conversion Price.
6.7 TRUST TO RESERVE UNITS
The Trust covenants with the Trustee that it will at all times reserve
and keep available out of its authorized Trust Units, solely for the purpose of
issue upon conversion of Debentures as in this Article provided, and
conditionally allot to Debentureholders who may exercise their conversion rights
hereunder, such number of Trust Units as shall then be issuable upon the
conversion of all outstanding Debentures. The Trust covenants with the Trustee
that all Trust Units which shall be so issuable shall be duly and validly issued
as fully-paid.
6.8 CANCELLATION OF CONVERTED DEBENTURES
Subject to the provision of Section 6.4 as to Debentures converted in
part, all Debentures converted in whole or in part under the provisions of this
Article shall be forthwith delivered to and cancelled by the Trustee and no
Debenture shall be issued in substitution therefor.
6.9 CERTIFICATE AS TO ADJUSTMENT
The Trust shall from time to time immediately after the occurrence of
any event which requires an adjustment or readjustment as provided in Section
6.5, deliver an Officer's Certificate to the Trustee specifying the nature of
the event requiring the same and the amount of the adjustment necessitated
thereby and setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based, which certificate and the amount of
the adjustment specified therein shall be verified by an opinion of a firm of
chartered accountants appointed by the Trust and acceptable to the Trustee (who
may be the Auditors of the Trust) and shall be conclusive and binding on all
parties in interest. When so approved, the Trust shall, except in respect of any
subdivision, redivision, reduction, combination or consolidation of the Trust
Units, forthwith give notice to the Debentureholders in the manner
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provided in Section 15.2 specifying the event requiring such adjustment or
readjustment and the results thereof, including the resulting Conversion Price;
provided that, if the Trust has given notice under this Section 6.9 covering all
the relevant facts in respect of such event and if the Trustee approves, no such
notice need be given under this Section 6.9.
6.10 NOTICE OF SPECIAL MATTERS
The Trust covenants with the Trustee that so long as any Debenture
remains outstanding, it will give notice to the Trustee, and to the
Debentureholders in the manner provided in Section 15.2, of its intention to fix
a record date for any event referred to in Section 6.5(a), (b) or (c) (other
than the subdivision, redivision. reduction, combination or consolidation of its
Trust Units) which may give rise to an adjustment in the Conversion Price, and,
in each case, such notice shall specify the particulars of such event and the
record date and the effective date for such event; provided that the Trust shall
only be required to specify in such notice such particulars of such event as
shall have been fixed and determined on the date on which such notice is given.
Such notice shall be given not less than fourteen (14) days in each case prior
to such applicable record date.
6.11 PROTECTION OF TRUSTEE
Subject to Section 16.3, the Trustee:
(a) shall not at any time be under any duty or responsibility to any
Debentureholder to determine whether any facts exist which may require
any adjustment in the Conversion Price, or with respect to the nature
or extent of any such adjustment when made, or with respect to the
method employed in making the same;
(b) shall not be accountable with respect to the validity or value (or the
kind or amount) of any Trust Units or of any units, shares or other
securities or property which may at any time be issued or delivered
upon the conversion of any Debenture;
(c) shall not be responsible for any failure of the Trust to make any cash
payment or to issue, transfer or deliver Trust Units, unit
certificates upon the surrender of any Debenture for the purpose of
conversion, or to comply with any of the covenants contained in this
Article; and
(d) shall be entitled to act and rely on the adjustment calculation of the
Trust, the Manager, the Trust's Auditors or investment dealer selected
by the Trust or the Manager.
6.12 U.S. 1933 ACT LEGEND ON TRUST UNITS
Each certificate representing Trust Units issued upon conversion of
Debentures pursuant to this Article 6 bearing the U.S. 1933 Act Legend set forth
in Section 2.14, as well as all certificates issued in exchange for or in
substitution of the foregoing securities, shall also bear
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the U.S. 1933 Act Legend set forth in Section 2.14; provided that if the Trust
Units are being sold outside the United States in accordance with Rule 904 of
Regulation S and provided that the Trust is a "foreign issuer" within the
meaning of Regulation S at the time of sale, the U.S. 1933 Act Legend may be
removed by providing a declaration to the Trustee, in its capacity as the
transfer agent for the Trust Units, as set forth in Schedule E hereto (or as the
Trust may prescribe from time to time); and provided further that, if any such
securities are being sold within the United States in accordance with Rule 144
under the 1933 Act, the U.S. 1933 Act Legend may be removed by delivery to the
Trustee in its capacity as the transfer agent for the Trust Units, of an opinion
of counsel of recognized standing, reasonably satisfactory to the Trust, to the
effect that the U.S. 1933 Act Legend is no longer required under applicable
requirements of the 1933 Act or any applicable local laws or regulations.
Provided that the Trustee obtains confirmation from the Trust that such counsel
is satisfactory to it, it shall be entitled to rely on such opinion of counsel
without further inquiry.
ARTICLE 7
LIMITATIONS ON OWNERSHIP
7.1 LIMITATIONS ON OWNERSHIP
At no time may non-residents of Canada be the beneficial owners of a
majority of the Trust Units on a fully diluted basis, whether by way of
conversion of Debentures to Trust Units, repayment of Debentures by issuance of
Trust Units, or otherwise, and the Manager on behalf of the Trust has informed
the Trustee and the transfer agent and registrar of the Trust Units (the
"TRANSFER AGENT") of this restriction. The Trust may require declarations as to
the jurisdictions in which beneficial owners of Debentures are resident. If the
Trust becomes aware as a result of such declarations as to beneficial ownership,
that the beneficial owners of 49% or more of the Trust Units then outstanding,
on a fully diluted basis, are, or may be, non-residents or that such a situation
is imminent, the Trust may make a public announcement thereof and shall cause
the Debenture Trustee or Transfer Agent not to accept a subscription for
Debentures from or issue or register a transfer of Debentures to a Person unless
the Person provides a declaration that the Person is not a non-resident. If,
notwithstanding the foregoing, the Trust determines that a majority of the Trust
Units, on a fully diluted basis, are held by non-residents, the Trust may send a
notice to non-resident holders of Debentures or Trust Units, chosen in inverse
order to the order of acquisition or registration of the Debentures and Trust
Units or in such manner as the Trust may consider equitable and practicable,
requiring them to sell their Debentures or Trust Units or a portion thereof
within a specified period of not less than 60 days. If the Debentureholders or
unitholders receiving such notice have not sold the specified number of
Debentures or Trust Units or provided the Trust with satisfactory evidence that
they are not non-residents within such period, the Trust or an agent appointed
for such purpose may on behalf of such Debentureholder or unitholder sell such
Debentures or Trust Units, as the case may be, and, in the interim, shall
suspend the rights attached to such Debentures or Trust Units, as the case may
be, and their rights shall be limited to receiving the net proceeds of sale upon
surrender of the certificates representing such Debentures or Trust Units.
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7.2 PROHIBITION AGAINST OWNERSHIP BY CERTAIN U.S. RETIREMENT PLANS
U.S. Retirement Plans are prohibited from purchasing or otherwise
acquiring or holding, directly or indirectly, beneficial ownership of any
Debentures at any time, and each purchaser or other acquirer of any Debentures
(including any subsequent purchaser or other acquirer), by its purchasing or
acquiring Debentures, shall be deemed to have represented to the Trust, the
Manager and any underwriters of such Debentures that (a) it is not investing
assets of a U.S. Retirement Plan in order to acquire or hold the Debentures and
will not otherwise hold the Debentures as U.S. Plan Assets and (b) prior to any
transfer of the Debentures, it will inform any transferee thereof (other than a
transferee in a transaction consummated on the TSX) of the foregoing
prohibitions and the representations which such transferee will be deemed to
make by purchasing or acquiring the Debentures. The foregoing prohibition and
deemed representations are hereinafter referred to as the "U.S. RETIREMENT PLAN
PROHIBITION". Each purchaser or other acquirer of any Debentures at any time
(including any subsequent purchaser or other acquirer) shall also be deemed to
have agreed to indemnify the Trust, the Manager, any underwriters of such
Debentures, their Affiliates and their respective trustees, directors and
employees (including their respective successors and assigns) against any loss,
cost or damage caused by any breach by such person of the U.S. Retirement Plan
Prohibition (a "DEEMED INDEMNITY").
The Manager may require any purchaser or other acquirer of Debentures
to file a declaration to the effect that it has not violated the U.S. Retirement
Plan Prohibition. If the Manager determines, as a result of any such declaration
or otherwise, that a violation of the U.S. Retirement Plan Prohibition has
occurred or that, after giving effect to any proposed subscription, issue or
transfer of Debentures to any Person, a violation of the U.S. Retirement Plan
Prohibition would occur, the Manager may instruct the Trustee not to accept any
subscription for any Debentures from such Person, issue any Debentures to such
Person or register or otherwise recognize the transfer of any Debentures to such
Person, unless such Person shall provide a declaration that it has not violated
the U.S. Retirement Plan Prohibition. If, notwithstanding the foregoing, the
Manager determines that one or more Debentures were acquired or are being held
in violation of the U.S. Retirement Plan Prohibition, the Manager may instruct
the Trustee to send a written notice prepared by the Manager (a "U.S. RETIREMENT
PLAN NOTICE") through the appropriate holder of record to the beneficial owner
of the Debentures (a "U.S. RETIREMENT PLAN HOLDER"). The U.S. Retirement Plan
Notice shall require such U.S. Retirement Plan Holder to sell all of its
Debentures (collectively, "U.S. RETIREMENT PLAN DEBENTURES") to a Person whose
ownership does not violate the U.S. Retirement Plan Prohibition within the
period stipulated in the U.S. Retirement Plan Notice. The U.S. Retirement Plan
Notice shall be given by registered prepaid mail to the holder of record for
such U.S. Retirement Plan Holder and shall specify a date, which shall not be
less than 10 days, within which the U.S. Retirement Plan Debentures must be sold
to a Person whose ownership does not violate the U.S. Retirement Plan
Prohibition. The U.S. Retirement Plan Notice shall also require the U.S.
Retirement Plan Holder to notify the Manager forthwith after the required sale
has been completed.
If the U.S. Retirement Plan Debentures have not been sold by the U.S.
Retirement Plan Holder on or before the date stipulated in the U.S. Retirement
Plan Notice and the U.S.
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Retirement Plan Holder has not provided evidence satisfactory to the Manager to
the effect that U.S. Retirement Plan Holder's ownership does not violate the
U.S. Retirement Plan Prohibition before such date, the Manager may instruct the
Trustee, without further notice, to effect the transfer of the U.S. Retirement
Plan Debentures on behalf of the U.S. Retirement Plan Holder on and subject to
the terms herein contained and, in the interim, to suspend the rights of such
U.S. Retirement Plan Holder to receive interest payments or receive
distributions in respect of the U.S. Retirement Plan Debentures, to exercise the
voting rights of the U.S. Retirement Plan Debentures or to convert the U.S.
Retirement Plan Debentures to Trust Units. The provisions of Section 7.1 shall
be applicable mutatis mutandis with respect to any such transfer by the Trustee,
except that such U.S. Retirement Plan Holder shall only have the right to
receive the net proceeds of such sale and shall have no right to receive any
unpaid interest or distributions in respect of such U.S. Retirement Plan
Debentures. Notwithstanding the immediately preceding two sentences, the Trustee
will have no obligation to carry out any actions contemplated in the immediately
preceding two sentences unless it is satisfied, acting reasonably, that taking
such actions will not expose the Trustee to any material liability.
Notwithstanding the foregoing, if the Manager makes a public
announcement that the Manager has determined that the U.S. Retirement Plan
Prohibition and the Deemed Indemnity are not then in the best interests of the
Trust, the U.S. Retirement Plan Prohibition and the Deemed Indemnity shall
thereafter be immediately suspended until such time as the Manager reinstates
the U.S. Retirement Plan Prohibition and the Deemed Indemnity by issuing a
public announcement of such reinstatement.
ARTICLE 8
COVENANTS OF THE TRUST
The Trust hereby covenants and agrees with the Trustee for the benefit
of the Trustee and the Debentureholders, that so long as any Debentures remain
outstanding:
8.1 TO PAY PRINCIPAL AND INTEREST
The Trust will duly and punctually pay or cause to be paid to every
Debentureholder the principal of and interest accrued on the Debentures of which
it is the Debentureholder on the dates, at the places and in the manner
mentioned herein and in the Debentures subject to the provisions hereof.
8.2 TO PAY TRUSTEE'S REMUNERATION
The Trust will pay the Trustee reasonable remuneration for its
services as Trustee hereunder and will repay to the Trustee on demand all moneys
which shall have been paid by the Trustee in connection with the execution of
the trusts hereby created and such moneys including the Trustee's remuneration,
shall be payable out of any funds coming into the possession of the Trustee in
priority to payment of any principal any of the Debentures or interest thereon.
The said remuneration shall continue to be payable until the trusts hereof be
finally wound up and
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whether or not the trusts of this Indenture shall be in the course of
administration by or under the direction of a court of competent jurisdiction.
8.3 TO GIVE NOTICE OF DEFAULT
The Trust shall notify in writing the Trustee immediately upon
obtaining knowledge of any Event of Default hereunder.
8.4 PRESERVATION OF EXISTENCE, ETC.
Subject to the express provisions hereof, the Trust will carry on and
conduct its activities, and cause its Subsidiaries to carry on and conduct their
businesses, in a proper, efficient and business-like manner and in accordance
with good business practices; and, subject to the express provisions hereof, it
will do or cause to be done all things necessary to preserve and keep in full
force and effect its and its Subsidiaries respective existences and rights.
8.5 ADDITIONAL COVENANTS
(a) The Trust will keep or cause to be kept proper books of record and
account, in which full and correct entries shall be made of all
financial transactions and the assets and business of the Trust in
accordance with generally accepted accounting principles;
(b) The Trust will take all reasonable steps and actions and do all such
acts and things as may be required to: (i) maintain (as long as it
meets the minimum listing requirements of such institution) the
listing and posting for trading of the Initial Debentures and the
Trust Units on the TSX, and (ii) maintain its status as a reporting
issuer, or the equivalent thereof, not in default of the requirements
of Applicable Securities Legislation;
(c) The Trust shall maintain or cause the related registrar or the related
paying agent, as the case may be, to maintain an office or agency at
each place of payment for any Debentures where the Debentures may be
presented or surrendered for payment, or for registration of transfer
or exchange, and where notices and demands to or upon the Trust in
respect of such Debentures and this Indenture may be served. The Trust
will give prompt written notice to the Trustee of the location, and
any change in the location, of any such office or agency. If at any
time the Trust shall fail to maintain such required office or agency
or shall fail to furnish to the Trustee the address of any such office
or agency, such presentations, surrenders, notices and demands may be
made or served at the principal corporate trust office of the Trustee
in Toronto, Ontario and the Trust hereby appoints the Trustee as its
agent to receive all such presentations, surrenders, notices and
demands;
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(d) The Trust shall deliver to the Trustee within 90 days after the end of
each fiscal year of the Trust and at any reasonable time upon demand
by the Trustee, an Officer's Certificate stating that the Trust has
complied with, in all material respects, all requirements of the Trust
contained in this Indenture that, if not complied with, in all
material respects, would, with the giving of notice, lapse of time, or
otherwise, constitute an Event of Default. If an Event of Default
shall have occurred, the certificate shall describe the nature and
particulars of the Event of Default and its current status and steps
taken or proposed to be taken to eliminate such circumstances and
remedy such Event of Default, as the case may be; and
(e) The Trust will, at the relevant times and upon exercise of the
relevant rights or elections, comply and take all reasonable measures
necessary to comply at all times with subsections 4.6(c) and 4.10(c)
including, without limitation, make application for any order, ruling,
registration or filing or give any notice required under Applicable
Securities Legislation.
8.6 REPORTING REQUIREMENTS
The Trust shall file with the Trustee within 15 days after the filing
thereof with the Ontario Securities Commission, copies of the Trust's annual
report and the information, documents and other reports that the Trust is
required to file with the Ontario Securities Commission and deliver to
unitholders. Notwithstanding that the Trust may not be required to remain
subject to the reporting requirements of the Ontario Securities Commission, the
Trust shall provide to the Trustee (a) within 90 days after the end of each
fiscal year, an annual financial statement of the Trust, and (b) within 45 days
after the end of each of the first three fiscal quarters of each fiscal year,
interim financial statements of the Trust which shall, at a minimum, contain
such information as is required to be provided in quarterly reports under the
laws of Canada or any province thereof to security holders of a company with
securities listed on the TSX, whether or not the Trust has any of its securities
so listed. Each of such reports will be prepared in accordance with the Canadian
disclosure requirements and generally accepted accounting principles. The Trust
will provide copies of such information, documents and reports to
Debentureholders (including for greater certainty, Beneficial Holders) upon
request.
8.7 NO DISTRIBUTIONS ON TRUST UNITS IF EVENT OF DEFAULT
The Trust shall not declare or make any distribution to the holders of
its issued and outstanding Trust Units or make any repurchases of Trust Units
after the occurrence of an Event of Default unless and until such default shall
have been cured or waived or shall have ceased to exist.
8.8 PERFORMANCE OF COVENANTS OF TRUSTEE
If the Trust shall fail to perform any of its covenants contained in
this Indenture, and such failure has not been cured or rectified within the time
permitted by this Indenture, the
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Trustee may notify the Debentureholders of such failure on the part of the Trust
or may itself perform any of the covenants capable of being performed by it, but
shall be under no obligation to do so or to notify the Debentureholders. All
sums so expended or advanced by the Trustee shall be repayable as provided in
Section 8.2. No such performance, expenditure or advance by the Trustee shall be
deemed to relieve the Trust of any default hereunder.
ARTICLE 9
DEFAULT
9.1 EVENTS OF DEFAULT
Each of the following events constitutes, and is herein sometimes
referred to as, an "EVENT OF DEFAULT":
(a) failure for 15 days to pay interest on the Debentures when due;
(b) failure to pay principal or premium, if any, on the Debentures when
due whether at maturity, upon redemption, by acceleration or
otherwise;
(c) default in the performance of any material covenant in this Indenture
that is not cured within 30 days of the Trust receiving notice in
writing specifying such default and requiring it to be cured;
(d) if a decree or order of a court having jurisdiction is entered
adjudging the Trust a bankrupt or insolvent under the Bankruptcy and
Insolvency Act (Canada) or any other bankruptcy, insolvency or
analogous laws of Canada or any province thereof, or issuing
sequestration or process of execution against, or against any
substantial part of, the property of the Trust, or appointing a
receiver of, or of any substantial part of, the property of the Trust
or ordering the winding-up or liquidation of its affairs, and any such
decree or order continues unstayed and in effect for a period of 60
days or any substantial part of the property of the Trust shall be
sequestered or attached and shall not be returned to the possession of
the Trust or released from such attachment, as the case may be,
whether by filing of a bond or stay or otherwise within 60 consecutive
days thereafter;
(e) if the Trust institutes proceedings to be adjudicated a bankrupt or
insolvent, or consents to the institution of bankruptcy or insolvency
proceedings against it under the Bankruptcy and Insolvency Act
(Canada) or any other bankruptcy, insolvency or analogous laws of
Canada or any province thereof, or consents to the filing of any such
petition or to the appointment of a receiver, or liquidator or trustee
or assignee in bankruptcy or insolvency for it, or of any substantial
part of the property of the Trust or makes a general assignment for
the benefit of creditors, or is unable to or admits in writing its
inability to pay its debts generally
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as they become due, or any corporate action shall be taken by the
Trust in furtherance of any of the aforesaid actions;
(f) if a resolution is passed for the winding-up or liquidation of the
Trust except in the course of carrying out or pursuant to a
transaction in respect of which the conditions of Section 12.1 are
duly observed and performed; or
(g) if, after the date of this Indenture, any proceedings with respect to
the Trust are taken with respect to a compromise or arrangement, with
respect to creditors of the Trust generally, under the applicable
legislation of any jurisdiction;
in each and every such event the Trustee may, in its discretion, and shall, upon
receipt of a request in writing signed by the Debentureholders of not less than
25% in principal amount of the Debentures then outstanding, subject to the
provisions of Section 9.3, by notice in writing to the Trust declare the
principal of, and premium, if any, and accrued interest on, all Debentures then
outstanding and all other moneys outstanding hereunder to be due and payable and
the same shall forthwith become immediately due and payable to the Trustee,
anything therein or herein to the contrary notwithstanding, and the Trust shall
forthwith pay to the Trustee for the benefit of the Debentureholders such
principal of, and premium, if any, accrued and unpaid interest and interest on
amounts in default on, such Debenture (and, where such a declaration is based
upon a voluntary winding-up or liquidation of the Trust, the premium, if any, on
the Debentures then outstanding which would have been payable upon the
redemption thereof by the Trust on the date of such declaration) and all other
moneys outstanding hereunder, together with subsequent interest at the rate
borne by the Debentures on such principal, interest and such other moneys from
the date of the said declaration until payment is received by the Trustee, such
subsequent interest to be payable at the times and places and in the moneys
mentioned in and according to the tenor of the Debentures. Such payment when
made shall be deemed to have been made in discharge of the Trust's obligations
hereunder and any moneys so received by the Trustee shall be applied in the
manner provided in Section 9.7.
9.2 NOTICE OF EVENTS OF DEFAULT
If an Event of Default shall occur and be continuing the Trustee
shall, within 30 days after it receives written notice of the occurrence of such
Event of Default, give notice of such Event of Default to the Debentureholders
in the manner provided in Section 15.2, provided that notwithstanding the
foregoing, unless the Trustee shall have been requested to do so by the
Debentureholders of at least 25% of the principal amount of the Debentures then
outstanding, the Trustee shall not be required to give such notice if the
Trustee reasonably and in good faith shall have determined that the withholding
of such notice is in the best interests of the Debentureholders and shall have
so advised the Trust in writing.
9.3 WAIVER OF DEFAULT
Upon the happening of any Event of Default hereunder:
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(a) the Debentureholders shall have the power (in addition to the powers
exercisable by Extraordinary Resolution as hereinafter provided) by
requisition in writing by the Debentureholders of 66 2/3% of the
principal amount of Debentures then outstanding or by Extraordinary
Resolution of Debentureholders at a meeting held in accordance with
Article 14 hereof, to instruct the Trustee to waive any Event of
Default except a default in the payment of the principal of, or
premium, if any, or interest on any Debentures, or in respect of a
covenant or provision hereof that under the Indenture cannot be
modified or amended without the consent of the Debentureholder of each
outstanding Debenture of such series of Debentures affected and the
Trustee shall thereupon waive the Event of Default upon such terms and
conditions as shall be prescribed in such requisition; provided that
notwithstanding the foregoing if the Event of Default has occurred by
reason of the non-observance or non-performance by the Trust of any
covenant applicable only to one or more series of Debentures, then the
Debentureholders of not less than 66 2/3% of the principal amount of
the outstanding Debentures of those series shall be entitled to
exercise the foregoing power and the Trustee shall so act and it shall
not be necessary to obtain a waiver from the Debentureholders of any
other series of Debentures; and
(b) the Trustee, so long as it has not become bound to declare the
principal and interest on the Debentures then outstanding to be due
and payable, or to obtain or enforce payment of the same, shall have
power to waive any Event of Default if, in the Trustee's reasonable
opinion, the same shall have been cured or adequate satisfaction made
therefor, and in such event to cancel any such declaration theretofore
made by the Trustee in the exercise of its discretion, upon such terms
and conditions as the Trustee may deem advisable.
No such act or omission either of the Trustee or of the Debentureholders shall
extend to or be taken in any manner whatsoever to affect any subsequent Event of
Default or the rights resulting therefrom.
9.4 WAIVER OF DECLARATION
At any time after a declaration of acceleration with respect to the
Debentures has been made pursuant to Section 9.1 and before a judgement or
decree for payment of the money due has been obtained by the Trustee as
hereinafter provided, the Debentureholders of 66 2/3% of the principal amount
of outstanding Debentures, by written notice to the Trust and the Trustee, may
thereupon rescind and annul such declaration and its consequences if the Trust
has paid or deposited with the Trustee a sum sufficient to pay:
(a) all overdue interest on all Debentures;
(b) the principal of (and premium, if any) any of the Debentures which
have become due otherwise than by such declaration of acceleration,
and interest thereon at the rate or rates prescribed therefor in such
Debentures; and
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(c) to the extent that payment of such interest is lawful and applicable,
interest upon overdue instalments of interest at the rate or rates
prescribed therefor in such Debentures; and
all Events of Default with respect to the Debentures, other than the non-payment
of the principal of (and premium, if any), and interest on, such Debentures
which have become due solely by such declaration of acceleration, have been
cured or waived in accordance with the provisions of this Indenture.
9.5 ENFORCEMENT BY THE TRUSTEE
Subject to the provisions of Sections 5.5, 5.6 and 9.3 and to the
provisions of any Extraordinary Resolution that may be passed by the
Debentureholders, if the Trust shall fail to pay to the Trustee, forthwith after
the same shall have been declared to be due and payable under Section 9.1, the
principal of and premium (if any) and interest on all Debentures then
outstanding, together with any other amounts due hereunder, the Trustee may in
its discretion and shall upon receipt of a request in writing signed by the
Debentureholders of not less than 25% in principal amount of the Debentures then
outstanding and upon being funded and indemnified to its reasonable satisfaction
against all costs, expenses and liabilities to be incurred, proceed in its name
as Trustee hereunder to obtain or enforce payment of the said principal of and
premium (if any) and interest on all the Debentures then outstanding together
with any other amounts due hereunder by such proceedings authorized by this
Indenture or by law or equity as the Trustee in such request shall have been
directed to take, or if such request contains no such direction, or if the
Trustee shall act without such request, then by such proceedings authorized by
this Indenture or by suit at law or in equity as the Trustee shall deem
expedient.
The Trustee shall be entitled and empowered, either in its own name or
as trustee of an express trust, or as attorney-in-fact for the Debentureholders,
or in any one or more of such capacities, but subject in all cases to Section
5.5, to file such proof of debt, amendment of proof of debt, claim, petition or
other document as may be necessary or advisable in order to have the claims of
the Trustee and of the Debentureholders allowed in any insolvency, bankruptcy,
liquidation or other judicial proceedings relative to the Trust or its creditors
or relative to or affecting its property. The Trustee is hereby irrevocably
appointed (and the successive respective Debentureholders by taking and holding
the same shall be conclusively deemed to have so appointed the Trustee) the true
and lawful attorney-in-fact of the respective Debentureholders with authority to
make and file in the respective names of the Debentureholders or on behalf of
the Debentureholders as a class, subject to deduction from any such claims of
the amounts of any claims filed by any of the Debentureholders themselves, any
proof of debt, amendment of proof of debt claim, petition or other document in
any such proceedings and to receive payment of any sums becoming distributable
on account thereof, and to execute any such other papers and documents and to do
and perform any and all such acts and things for and on behalf of such
Debentureholders, as may be necessary or advisable in the opinion of the
Trustee, in order to have the respective claims of the Trustee and of the
Debentureholders against the Trust or its property allowed in any such
proceeding, and to receive payment of or on account of such claims; provided,
however, that nothing contained in this Indenture shall be deemed to give to
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the Trustee, unless so authorized by Extraordinary Resolution, any right to
accept or consent to any plan of reorganization or otherwise by action of any
character in such proceeding to waive or change in any way any right of any
Debentureholder.
The Trustee shall also have the power at any time and from time to
time to institute and to maintain such suits and proceedings as it may be
advised shall be necessary or advisable to preserve and protect its interests
and the interests of the Debentureholders.
All rights of action hereunder may be enforced by the Trustee without
the possession of any of the Debentures or the production thereof on the trial
or other proceedings relating thereto. Any such suit or proceeding instituted by
the Trustee shall be brought in the name of the Trustee as trustee of an express
trust, and any recovery of judgement shall be for the rateable benefit of the
Debentureholders subject to the provisions of this Indenture. In any proceeding
brought by the Trustee (and also any proceeding in which a declaratory judgement
of a court may be sought as to the interpretation or construction of any
provision of this Indenture, to which the Trustee shall be a party) the Trustee
shall be held to represent all the Debentureholders, and it shall not be
necessary to make any Debentureholders parties to any such proceeding.
9.6 NO SUITS BY DEBENTUREHOLDERS
No Debentureholder shall have any right to institute any action, suit
or proceeding at law or in equity for the purpose of enforcing payment of the
principal of or interest on the Debentures or for the execution of any trust or
power hereunder or for the appointment of a liquidator or receiver or for a
receiving order under the Bankruptcy and Insolvency Act (Canada) or to have the
Trust wound up or to file or prove a claim in any liquidation or bankruptcy
proceeding or for any other remedy hereunder, unless (a) such Debentureholder
shall previously have given to the Trustee written notice of the happening (or
continuance) of an Event of Default hereunder; (b) the Debentureholders by
Extraordinary Resolution or by written instrument signed by the Debentureholders
of at least 25% in principal amount of the Debentures then outstanding shall
have made a request to the Trustee and the Trustee shall have been afforded
reasonable opportunity either itself to proceed to exercise the powers
hereinbefore granted or to institute an action, suit or proceeding in its name
for such purpose; (c) the Debentureholders or any of them shall have furnished
to the Trustee, when so requested by the Trustee, sufficient funds and security
and indemnity satisfactory to it against the costs, expenses and liabilities to
be incurred therein or thereby; (d) the Trustee shall have failed to act within
30 days after such notification, request and offer of indemnity and such
notification, request and offer of indemnity are hereby declared in every such
case, at the option of the Trustee, to be conditions precedent to any such
proceeding or for any other remedy hereunder by or on behalf of the
Debentureholder; (e) during such 30 day period, the Debentureholders of 66 2/3%
of the principal amount of Debentures do not give the Trustee a direction
inconsistent with the request; and (f) such action is not otherwise contrary to
Article 5.
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9.7 APPLICATION OF MONEYS BY TRUSTEE
(a) Except as herein otherwise expressly provided, any moneys received by
the Trustee from the Trust pursuant to the foregoing provisions of
this Article 9, or as a result of legal or other proceedings or from
any trustee in bankruptcy or liquidator of the Trust, shall be
applied, together with any other moneys in the hands of the Trustee
available for such purpose, as follows:
(i) first, in payment or in reimbursement to the Trustee of its
compensation, costs, charges, expenses, borrowings, advances or
other moneys furnished or provided by or at the instance of the
Trustee in or about the execution of its trusts under, or
otherwise in relation to, this Indenture, with interest thereon
as herein provided;
(ii) second, but subject as hereinafter in this Section 9.7 provided,
in payment, rateably and proportionately to the
Debentureholders, of the principal of and premium (if any) and
accrued and unpaid interest and interest on amounts in default
on the Debentures which shall then be outstanding in the
priority of principal first and then premium and then accrued
and unpaid interest and interest on amounts in default unless
otherwise directed by Extraordinary Resolution and in that case
in such order or priority as between principal, premium (if any)
and interest as may be directed by such resolution; and
(iii) third, in payment of the surplus, if any, of such moneys to the
Trust or its assigns;
provided, however, that no payment shall be made pursuant to clause (ii) above
in respect of the principal, premium or interest on any Debenture held, directly
or indirectly, by or for the benefit of the Trust or any Subsidiary (other than
any Debenture pledged for value and in good faith to a Person other than the
Trust or any Subsidiary but only to the extent of such Person's interest
therein) except subject to the prior payment in full of the principal, premium
(if any) and interest (if any) on all Debentures which are not so held.
(b) The Trustee shall not be bound to apply or make any partial or interim
payment of any moneys coming into its hands if the amount so received
by it, after reserving thereout such amount as the Trustee may think
necessary to provide for the payments mentioned in Section 9.7(a), is
insufficient to make a distribution of at least 2% of the aggregate
principal amount of the outstanding Debentures, but it may retain the
money so received by it and invest or deposit the same as provided in
Section 16.9 until the money or the investments representing the same,
with the income derived therefrom, together with any other moneys for
the time being under its control shall be sufficient for the said
purpose or until it shall consider it advisable to apply the same in
the manner hereinbefore set forth. The foregoing shall, however, not
apply to a final payment in distribution hereunder.
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9.8 NOTICE OF PAYMENT BY TRUSTEE
Not less than 15 days' notice shall be given in the manner provided in
Section 15.2 by the Trustee to the Debentureholders of any payment to be made
under this Article 9. Such notice shall state the time when and place where such
payment is to be made and also the liability under this Indenture to which it is
to be applied. After the day so fixed, unless payment shall have been duly
demanded and have been refused, the Debentureholders will be entitled to
interest only on the balance (if any) of the principal moneys, premium (if any)
and interest due (if any) to them, respectively, on the Debentures, after
deduction of the respective amounts payable in respect thereof on the day so
fixed.
9.9 TRUSTEE MAY DEMAND PRODUCTION OF DEBENTURES
The Trustee shall have the right to demand production of the
Debentures in respect of which any payment of principal, interest or premium
required by this Article 9 is made and may cause to be endorsed on the same a
memorandum of the amount so paid and the date of payment, but the Trustee may,
in its discretion, dispense with such production and endorsement, upon such
indemnity being given to it and to the Trust as the Trustee shall deem
sufficient.
9.10 REMEDIES CUMULATIVE
No remedy herein conferred upon or reserved to the Trustee, or upon or
to the Debentureholders is intended to be exclusive of any other remedy, but
each and every such remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now existing or hereafter to exist by law or by
statute.
9.11 JUDGEMENT AGAINST THE TRUST
The Trust covenants and agrees with the Trustee that, in case of any
judicial or other proceedings to enforce the rights of the Debentureholders,
judgement may be rendered against it in favour of the Debentureholders or in
favour of the Trustee, as trustee for the Debentureholders, for any amount which
may remain due in respect of the Debentures and premium (if any) and the
interest thereon and any other moneys owing hereunder.
9.12 IMMUNITY OF TRUSTEES AND OTHERS
The Debentureholders and the Trustee hereby waive and release any
right, cause of action or remedy now or hereafter existing in any jurisdiction
against any past, present or future officer, trustee, employee and agent or
holder of Trust Units of the Trust or of the Manager or any of its Affiliates or
of any successor or any of them or any of their respective directors, officers,
employees and agents for the payment of the principal of or premium or interest
on any of the Debentures or on any covenant, agreement, representation or
warranty by the Trust herein or in the Debentures contained.
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9.13 CONTROL BY DEBENTUREHOLDERS
The Debentureholders of at least a majority in principal amount of the
outstanding Debentures, may direct the time, method and place (in Ontario) of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it with respect to the Debentures; and take any
other action authorized to be taken by or on behalf of the Debentureholders of
any specified aggregate principal amount of Debentures under any provisions of
this Indenture or under all applicable laws.
The Trustee may refuse, however, to follow any direction that
conflicts with law or this Indenture.
9.14 RIGHTS OF DEBENTUREHOLDERS TO RECEIVE PAYMENT
Subject to Article 5 of this Indenture, the right of any
Debentureholder to receive payment of principal of, and premium (if any) and
interest on, the Debentures held by such Debentureholder, on or after the
respective due dates expressed in the Debentures (or, in the case of redemption,
on the Redemption Date), or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of the Debentureholder.
9.15 DELAY OR OMISSION NOT WAIVER
No delay or omission of the Trustee or of any Debentureholder to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Debentureholders may be exercised from time to time, and
as often as may be deemed expedient, by the Trustee or by the Debentureholders,
as the case may be.
ARTICLE 10
SATISFACTION AND DISCHARGE
10.1 CANCELLATION AND DESTRUCTION
All Debentures shall forthwith after payment thereof be delivered to
the Trustee and cancelled by it. All Debentures cancelled or required to be
cancelled under this or any other provision of this Indenture shall be destroyed
by the Trustee and, if required by the Trust, the Trustee shall furnish to it a
destruction certificate setting out the designating numbers of the Debentures so
destroyed.
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10.2 NON- PRESENTATION OF DEBENTURES
In case the Debentureholder of any Debenture shall fall to present the
same for payment on the date on which the principal, premium (if any) or the
Interest thereon or represented thereby becomes payable either at maturity or
otherwise or fails to accept payment on account thereof and give such receipt
therefor, if any, as the Trustee may require:
(a) the Trust shall be entitled to pay or deliver to the Trustee and
direct the Trustee to set aside; or
(b) in respect of moneys or Trust Units in the hands of the Trustee which
may or should be applied to the payment of the Debentures, the Trust
shall be entitled to direct the Trustee to set aside; or
(c) if the redemption was pursuant to notice given by the Trustee, the
Trustee may itself set aside;
the principal, premium (if any) or the interest, as the case may be, in trust
to be paid or delivered to such Debentureholder upon due presentation or
surrender thereof in accordance with the provisions of this Indenture; and
thereupon the principal, premium (if any) or the interest payable on or
represented by each Debenture in respect whereof such moneys or Trust Units, if
applicable, have been set aside shall be deemed to have been paid and the
Debentureholder thereof shall thereafter have no right in respect thereof
except that of receiving delivery and payment of the moneys or Trust Units plus
distributions on Trust Units, if applicable, so set aside by the Trustee upon
due presentation and surrender thereof, subject always to the provisions of
Section 10.3.
10.3 REPAYMENT OF UNCLAIMED MONEYS OR TRUST UNITS
Subject to applicable law, any moneys or Trust Units, if applicable,
set aside under Section 10.2 and not claimed by and paid to Debentureholders as
provided in Section 10.2 within ten years after the date of such setting aside
shall be repaid and delivered to the Trust by the Trustee and thereupon the
Trustee shall be released from all further liability with respect to such moneys
or Trust Units, if applicable, and thereafter the Debentureholders in respect of
which such moneys or Trust Units, if applicable, were so repaid to the Trust
shall have no rights in respect thereof except to obtain payment and delivery of
the moneys or Trust Units, if applicable, from the Trust subject to any
limitation provided by the laws of the Province of Ontario.
10.4 DISCHARGE
The Trustee shall at the written request of the Trust release and
discharge this Indenture and execute and deliver such instruments as it shall be
advised by Counsel are requisite for that purpose and to release the Trust from
its covenants herein contained (other than the provisions relating to the
indemnification of the Trustee), upon proof being given to the
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reasonable satisfaction of the Trustee that the principal and premium (if any)
of and interest (including interest on amounts in default, if any), on all the
Debentures and all other moneys payable hereunder have been paid or satisfied or
that, all the Debentures having matured or having been duly called for
redemption, payment of the principal of and interest (including interest on
amounts in default, if any) on such Debentures and of all other moneys payable
hereunder has been duly and effectually provided for in accordance with the
provisions hereof.
10.5 SATISFACTION
(a) The Trust shall be deemed to have fully paid, satisfied and discharged
all of the outstanding Debentures of any series and the Trustee, at
the expense of the Trust, shall execute and deliver proper instruments
acknowledging the full payment, satisfaction and discharge of such
Debentures, when, with respect to all of the outstanding Debentures or
all of the outstanding Debentures of any series, as applicable,
either:
(i) the Trust has deposited or caused to be deposited with the
Trustee as trust funds or property in trust for the purpose of
making payment on such Debentures, an amount in money or Trust
Units, if applicable, sufficient to pay, satisfy and discharge
the entire amount of principal, premium, if any, and interest,
if any, to maturity or any repayment date or Redemption Dates,
as the case may be, of such Debentures; or
(ii) the Trust has deposited or caused to be deposited with the
Trustee as trust property in trust for the purpose of making
payment on such Debentures:
(A) if the Debentures are issued in Canadian dollars, such
amount in Canadian dollars of direct obligations of, or
obligations the principal and interest of which are
guaranteed by, the Government of Canada or Trust Units, if
applicable; or
(B) if the Debentures are issued in a currency or currency unit
other than Canadian dollars, cash in the currency or
currency unit in which the Debentures are payable and/or
such amount in such currency or currency unit of direct
obligations of, or obligations the principal and interest
of which are guaranteed by, the Government of Canada or the
government that issued the currency or currency unit in
which the Debentures are payable or Trust Units, if
applicable;
as will, together with the income to accrue thereon and
reinvestment thereof, be sufficient to pay and discharge the
entire amount of principal and accrued and unpaid interest to
maturity or any repayment date, as the case may be, of all such
Debentures;
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and in either event:
(iii) the Trust has paid, caused to be paid or made provisions to the
satisfaction of the Trustee for the payment of all other sums
payable with respect to all of such Debentures (together with
all applicable expenses of the Trustee in connection with the
payment of such Debentures); and
(iv) the Trust has delivered to the Trustee an Officer's Certificate
stating that all conditions precedent herein provided relating
to the payment, satisfaction and discharge of all such
Debentures have been complied with.
Any deposits with the Trustee referred to in this Section 10.5 shall
be irrevocable, subject to Sections 10.3 and 10.6, and shall be made
under the terms of an escrow and/or trust agreement in form and
substance satisfactory to the Trustee and which provides for the due
and punctual payment of the principal of, and interest and premium, if
any, on the Debentures being satisfied.
(b) Upon the satisfaction of the conditions set forth in this Section 10.5
with respect to all the outstanding Debentures, or all the outstanding
Debentures of any series, as applicable, the terms and conditions of
the Debentures, including the terms and conditions with respect
thereto set forth in this Indenture (other than those contained in
Articles 2, 4, 6 and Section 9.5 and the provisions of Article 1
pertaining to the foregoing provisions) shall no longer be binding
upon or applicable to the Trust.
(c) Any funds or obligations deposited with the Trustee pursuant to this
Section 10.5 shall be denominated in the currency or denomination of
the Debentures in respect of which such deposit is made.
(d) If the Trustee is unable to apply any money or securities in
accordance with this Section 10.5 by reason of any legal proceeding or
any order or judgement of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the
Trust's obligations under this Indenture and the affected Debentures
shall be revived and reinstated as though no money or securities had
been deposited pursuant to this Section 10.5 until such time as the
Trustee is permitted to apply all such money or securities in
accordance with this Section 10.5, provided that if the Trust has made
any payment in respect of principal, premium or interest on Debentures
or, as applicable, other amounts because of the reinstatement of its
obligations, the Trust shall be subrogated to the rights of the
Debentureholders of such Debentures to receive such payment from the
money or securities held by the Trustee.
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10.6 CONTINUANCE OF RIGHTS, DUTIES AND OBLIGATIONS
Where trust funds or trust property have been deposited pursuant to
Section 10.5, the Debentureholders and the Trust shall continue to have and be
subject to their respective rights, duties and obligations under Articles 2 and
4 hereof.
ARTICLE 11
TRUST UNIT INTEREST PAYMENT ELECTION
11.1 TRUST UNIT INTEREST PAYMENT ELECTION
(a) Provided that no Event of Default has occurred and is continuing and
that all applicable regulatory approvals have been obtained (including
any required approval of any stock exchange on which the Debentures or
Trust Units are then listed), the Trust shall have the right at any
time and, from time to time, to make a Trust Unit Interest Payment
Election in respect of any Interest Obligation in whole or in part by
delivering a Trust Unit Interest Payment Election Notice to the agent
with a copy to the Trustee no later than the earlier of: (i) the date
required by applicable law or the rules of any stock exchange on which
the Debentures or Trust Units are then listed, and (ii) the day which
is 15 Business Days prior to the Interest Payment Date to which the
Trust Unit Interest Payment Election relates.
(b) Upon receipt of a Trust Unit Interest Payment Election Notice, an
agent of the Trust shall, in accordance with this Article 11 and such
Trust Unit Interest Payment Election Notice, deliver Trust Unit Bid
Requests to the investment banks, brokers or dealers identified by the
Trust or the Manager or any of its Affiliates, in its absolute
discretion, in the Trust Unit Interest Payment Election Notice.
Alternatively, the Trustee may agree to the Trust establishing an
account or accounts with an investment bank, broker or dealer
identified by the Trust, in its absolute discretion, in the Trust Unit
Interest Payment Election Notice for the purpose of such investment
bank, broker or dealer selling Freely Tradeable Trust Units on behalf
of the Trust in accordance with the terms hereof (which investment
bank, broker or dealer shall notify the Trust and the Trustee as such
Trust Units are sold and the settlement rules prescribed by securities
regulatory policies shall apply in respect of the payment for such
Trust Units). The agent shall send copies of the monthly statements
and transaction slips in respect of all sales of Trust Units to the
Trust (with a duplicate copy to the Trustee, or as it may otherwise in
writing direct), as soon as reasonably practicable after preparation
thereof). All fees payable in respect of such accounts shall be paid
by the Trust; provided, however, that it shall be a condition
precedent to the Trust establishing such an account with one or more
investment banks, brokers or dealers that all necessary legal,
regulatory and other requirements have been satisfied by the Trust, if
applicable, and the Trust shall assume, to the maximum extent
permitted herein and at law, all responsibility for administering such
account(s). In
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connection with the Trust Unit Interest Payment Election, the agent of
the Trust shall have the power to: (i) accept delivery of the Trust
Units from the Trust and process the Trust Units in accordance with
the Trust Unit Interest Payment Election Notice, (ii) accept bids with
respect to, and consummate sales of, such Trust Units, each as the
Trust shall direct in its absolute discretion through the investment
banks, brokers or dealers identified by the Trust in the Trust Unit
Interest Payment Election Notice, (iii) invest the proceeds of such
sales on the direction of the Trust in Government Obligations which
mature prior to an applicable Interest Payment Date and use such
proceeds to pay the Interest Obligation in respect of which the Trust
Unit Interest Payment Election was made and (iv) perform any other
action necessarily incidental thereto as directed by the Trust in its
absolute discretion. The Trust Unit Interest Payment Election Notice
shall direct the agent to solicit and accept only, and each Trust Unit
Bid Request shall provide that the acceptance of any bid is
conditional on the acceptance of, sufficient bids to result in
aggregate proceeds from such issue and sale of Trust Units which,
together with the cash payments by the Trust, if any, equal the
Interest Obligation on the Trust Unit Delivery Date.
(c) The Trust Unit Interest Payment Election Notice shall provide
confirmation from the Trust that all applicable regulatory approvals
have been obtained and shall also provide for, and all bids shall be
subject to, the right of the Trust, by delivering written notice to
the agent with a copy to the Trustee at any time prior to the
consummation of such delivery and sale of the Trust Units on the Trust
Unit Delivery Date, to withdraw the Trust Unit Interest Payment
Election (which shall have the effect of withdrawing each related
Trust Unit Bid Request), whereupon the Trust shall be obliged to pay
in cash the Interest Obligation in respect of which the Trust Unit
Interest Payment Election Notice has been delivered.
(d) Any sale of Trust Units pursuant to this Article 11 may be made to one
or more Persons whose bids are solicited.
(e) The amount receivable by a Debentureholder in respect of the Interest
Obligation or the entitlement thereto will not be affected by whether
or not the Trust elects to satisfy the Interest Obligation pursuant to
a Trust Unit Interest Payment Election.
(f) The agent shall inform the Trust promptly following receipt of any bid
or bids for Trust Units solicited pursuant to the Trust Unit Bid
Requests. The agent shall accept such bid or bids as the Trust, in its
absolute discretion, shall direct by Written Direction of the Trust,
provided that the aggregate proceeds of all sales of Trust Units
resulting from the acceptance of such bids, together with the amount
of any cash payment by the Trust, on the Trust Unit Delivery Date,
must be equal to the related Trust Unit Interest Payment Election
Amount in connection with any bids so accepted, the Trust, the agent
(if required by the Trust in its absolute discretion) and the
applicable bidders shall, not later than the Trust Unit Delivery
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Date, enter into Trust Unit Purchase Agreements and shall comply with
all Applicable Securities Legislation, including the securities rules
and regulations of any stock exchange on which the Debentures or Trust
Units are then listed. The Trust shall pay all fees and expenses in
connection with the Trust Unit Purchase Agreements including the fees
and commissions charged by the investment banks, brokers and dealers
and the fees of the agent.
(g) Provided that (i) all conditions specified in each Trust Unit Purchase
Agreement to the closing of all sales thereunder have been satisfied,
other than the delivery of the Trust Units to be sold thereunder
against payment of the purchase price thereof, and (ii) the purchasers
under each Trust Unit Purchase Agreement shall be ready, willing and
able to perform thereunder, in each case on the Trust Unit Delivery
Date, the Trust shall, on the Trust Unit Delivery Date, deliver to the
agent the Trust Units to be sold on such date, an amount in cash equal
to the value of any fractional Trust Units and an Officer's
Certificate to the effect that all conditions precedent to such sales,
including those set forth in this Indenture and in each Trust Unit
Purchase Agreement, have been satisfied. Upon such deliveries, the
agent shall consummate such sales on such Trust Unit Delivery Date by
the delivery of the Trust Units to such purchasers against payment to
the Trustee in immediately available funds of the purchase price
therefor in an aggregate amount equal to the Trust Unit Interest
Payment Election Amount (less any amount attributable to any
fractional Trust Units), whereupon the sole right of a Debentureholder
to receive such Debentureholder's portion of the Trust Unit Interest
Payment Election Amount will be to receive same from the agent out of
the proceeds of such sales of Trust Units plus any amount received by
the agent from the Trust attributable to any fractional Trust Units in
full satisfaction of the Interest Obligation and the Debentureholder
will have no further recourse to the Trust in respect of the Interest
Obligation.
(h) The agent shall, on the Trust Unit Delivery Date, use the sale
proceeds of the Trust Units (together with any cash received from the
Trust) to purchase, on the direction of the Trust in writing,
Government Obligations which mature prior to the applicable Interest
Payment Date and which the agent is required to hold until maturity
(the "TRUST UNIT PROCEEDS INVESTMENT") and shall, on such date,
deposit the balance, if any, of such sale proceeds in the Property
Account for such Debentures. The agent shall hold such Trust Unit
Proceeds Investment (but not income earned thereon) under its
exclusive control in an irrevocable trust for the benefit of the
Debentureholders. At least one Business Day prior to the Interest
Payment Date, the agent shall deposit amounts from the proceeds of the
Trust Unit Proceeds Investment in the Property Account to bring the
balance of the Property Account to the Trust Unit Interest Payment
Election Amount. On the Interest Payment Date, the agent shall pay the
funds held in the Property Account to the Debentureholders of record
of the Debentures on the record date of such Interest Payment Date
(less any tax required to be withheld, if any) and, provided that
there is no Event of Default, shall remit amounts, if any, in respect
of income
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earned on the Trust Unit Proceeds Investment or otherwise in excess of
the Trust Unit Interest Payment Election Amount to the Trust,
(i) Neither the making of a Trust Unit Payment Election nor the
consummation of sales of Trust Units on a Trust Unit Delivery Date
shall (i) result in the Debentureholders not being entitled to receive
on the applicable Interest Payment Date cash in an aggregate amount
equal to the Interest Obligation payable on such date or (ii) entitle
such Debentureholders to receive any Trust Units in satisfaction of
such Interest Obligation.
(j) No fractional Trust Units will be issued in satisfaction of interest
but in lieu thereof the Trust will satisfy such fractional interest by
a cash payment equal to the Current Market Price of such fractional
interest (less any tax required to be withheld, if any).
ARTICLE 12
SUCCESSORS
12.1 RESTRICTIONS ON AMALGAMATION, MERGER AND SALE OF CERTAIN ASSETS, ETC.
Subject to the provisions of Article 13, the Trust shall not enter
into any transaction or series of transactions whereby all or substantially all
of its undertaking, property or assets would become the property of any other
Person (herein called a "SUCCESSOR") whether by way of reorganization,
consolidation, amalgamation, arrangement, merger, transfer, sale or otherwise,
unless:
(a) prior to or contemporaneously with the consummation of such
transaction the Trust and the Successor shall have executed such
instruments and done such things as, in the opinion of counsel, are
necessary or advisable to establish that upon the consummation of such
transaction:
(i) the Successor will have assumed all the covenants and
obligations of the Trust under this Indenture in respect of the
Debentures;
(ii) the Debentures will be valid and binding obligations of the
Successor entitling the Debentureholders thereof, as against the
Successor, to all the rights of Debentureholders under this
Indenture; and
(iii) in the case of an entity organized otherwise than under the laws
of the Province of Ontario, the successor shall attorn to the
jurisdiction of the courts of the Province of Ontario;
(iv) such transaction, in the opinion of Counsel, shall be on such
terms as to substantially preserve and not impair any of the
rights and powers of the Trustee or of the Debentureholders
hereunder; and
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(v) no condition or event shall exist as to the Trust (at the time of
such transaction) or the Successor (immediately after such
transaction) and after giving full effect thereto or immediately
after the Successor shall become liable to pay the principal
monies, premium, if any, interest and other monies due or which
may become due hereunder, which constitutes or would constitute
an Event of Default hereunder.
12.2 VESTING OF POWERS IN SUCCESSOR
Whenever the conditions of Section 12.1 hereof shall have been duly
observed and performed, any Successor formed by or resulting from such
transaction shall succeed to, and be substituted for, and may exercise every
right and power of the Trust under this Indenture with the same effect as though
the Successor had been named as the Trust herein and thereafter, except in the
case of a lease or other similar disposition of property to the Successor, the
Trust shall be relieved of all obligations and covenants under this Indenture
and the Debentures forthwith upon the Trust delivering to the Trustee an opinion
of Counsel to the effect that the transaction shall not result in any material
adverse tax consequences to the Trust or the Successor. The Trustee will, at the
expense of the Successor, execute any documents which it may be advised by
Counsel are necessary or advisable for effecting or evidencing such release and
discharge.
ARTICLE 13
COMPULSORY ACQUISITION
13.1 DEFINITIONS
In this Article:
(a) "AFFILIATE" and "ASSOCIATE" shall have their respective meanings set
forth in the Securities Act (Ontario);
(b) "DISSENTING DEBENTUREHOLDERS" means a Debentureholder who does not
accept an Offer referred to in Section 13.2 and includes any assignee
of the Debenture of a Debentureholder to whom such an Offer is made,
whether or not such assignee is recognized under this Indenture;
(c) "OFFER" means an offer to acquire outstanding Debentures where, as of
the date of the offer to acquire, the Debentures that are subject to
the offer to acquire, together with the Offerer's Debentures,
constitute in the aggregate 20% or more of the outstanding principal
amount of the Debentures;
(d) "OFFER TO ACQUIRE" includes an acceptance of an offer to sell;
(e) "OFFEROR" means a Person, or two or more Persons acting jointly or in
concert, who make an Offer to acquire Debentures;
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(f) "OFFEROR'S DEBENTURES" means Debentures beneficially owned, or over
which control or direction is exercised, on the date of an Offer by
the Offeror, any Affiliate or Associate of the Offeror or any Person
or company acting jointly or in concert with the Offeror; and
(g) "OFFEROR'S NOTICE" means the notice described in Section 13.3.
13.2 OFFER FOR DEBENTURES
If an Offer for all of the outstanding Debentures (other than
Debentures held by or on behalf of the Offeror or an Affiliate or Associate of
the Offeror) is made and:
(a) within the time provided in the Offer for its acceptance or within 45
days after the date the Offer is made, whichever period is the
shorter, the Offer is accepted by Debentureholders representing at
least 90% of the outstanding principal amount of the Debentures, other
than the Offeror's Debentures;
(b) the Offeror is bound to take up and pay for, or has taken up and paid
for the Debentures of the Debentureholders who accepted the Offer; and
(c) the Offeror complies with Sections 13.3 and 13.5;
the Offeror is entitled to acquire, and the Dissenting Debentureholders are
required to sell to the Offeror, the Debentures held by the Dissenting
Debentureholder for the same consideration per Debenture payable or paid, as the
case may be, under the Offer.
13.3 OFFEROR'S NOTICE TO DISSENTING DEBENTUREHOLDERS
Where an Offeror is entitled to acquire Debentures held by Dissenting
Debentureholders pursuant to Section 13.2 and the Offeror wishes to exercise
such right, the Offeror shall send by registered mail within 30 days after the
date of termination of the Offer a notice (the "OFFEROR'S NOTICE") to each
Dissenting Debentureholder stating that:
(a) Debentureholders holding at least 90% of the principal amount of all
outstanding Debentures, other than Offeror's Debentures, have accepted
the Offer;
(b) the Offeror is bound to take up and pay for, or has taken up and paid
for, the Debentures of the Debentureholders who accepted the Offer;
(c) Dissenting Debentureholders must transfer their respective Debentures
to the Offeror on the terms on which the Offeror acquired the
Debentures of the Debentureholders who accepted the Offer within 21
days after the date of the sending of the Offeror's Notice; and
(d) Dissenting Debentureholders must send their respective Debenture(s) to
the Trust within 21 days after the date of the sending of the
Offeror's Notice.
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13.4 DELIVERY OF DEBENTURE(S)
A Dissenting Debentureholder to whom an Offerors Notice is sent
pursuant to Section 13.3 shall, within 21 days after the sending of the
Offeror's Notice, send his Debenture(s) to the Trustee duly endorsed for
transfer.
13.5 PAYMENT OF CONSIDERATION TO TRUSTEE
Within 21 days after the Offeror sends an Offerors Notice pursuant to
Section 13.3, the Offeror shall pay or transfer to the Trustee, or to such other
Person as the Trustee may direct, the cash or other consideration that is
payable to Dissenting Debentureholders pursuant to Section 13.2.
13.6 CONSIDERATION TO BE HELD IN TRUST
The Trustee, or the Person directed by the Trustee, shall hold in
trust for the Dissenting Debentureholders the cash or other consideration they
or it receives under Section 13.5. The Trustee, or such Persons, shall deposit
cash in a separate account in a Canadian chartered bank, or other body
corporate, any of whose deposits are insured by the Canada Deposit Insurance
Corporation, and shall place other consideration in the custody of a Canadian
chartered bank or such other body corporate.
13.7 COMPLETION OF TRANSFER OF DEBENTURES TO OFFEROR
Within 30 days after the date of the sending of an Offeror's Notice
pursuant to Section 13.3, the Trustee, if the Offeror has complied with Section
13.5, shall:
(a) do all such acts and things and execute and cause to be executed such
instruments as in the Trustee's opinion may be reasonably necessary or
desirable to cause the transfer of the Debentures of the Dissenting
Debentureholders to the Offeror;
(b) subject to the receipt of the Debentures held by each Dissenting
Debentureholder and the receipt of appropriate documentation, send to
each Dissenting Debentureholder who has complied with Section 13.4 the
consideration to which such Dissenting Debentureholder is entitled
under this Article 13; and
(c) send to each Dissenting Debentureholder who has not complied with
Section 13.4 a notice stating that:
(i) his or her Debentures have been transferred to the Offeror;
(ii) the Trustee or some other Person designated in such notice are
holding in trust the consideration for such Debentures; and
(iii) the 'Trustee, or such other Person, will send the consideration
to such Dissenting Debentureholder as soon as possible after
receiving such
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Dissenting Debentureholders Debenture(s) or such other documents
as the Trustee or such other Person may required in lieu
thereof;
and the Trustee is hereby appointed the agent and attorney of the Dissenting
Debentureholders for the purposes of giving effect to the foregoing provisions.
13.8 COMMUNICATION OF OFFER TO TRUST
An Offeror cannot make an Offer for Debentures unless, concurrent with
the communication of the Offer to any Debentureholder, a copy of the Offer is
provided to the Trust.
ARTICLE 14
MEETINGS OF DEBENTUREHOLDERS
14.1 RIGHT TO CONVENE MEETING
The Trustee or the Trust may at any time and from time to time, and
the Trustee shall, on receipt of a written request of the Trust or a written
request signed by the Debentureholders of not less than 25% of the principal
amount of the Debentures then outstanding and upon receiving funding and being
indemnified to its reasonable satisfaction by the Trust or by the
Debentureholders signing such request, as the case may be, against the costs
which may be incurred in connection with the calling and holding of such
meeting, convene a meeting of the Debentureholders. In the event of the Trustee
failing, within 30 days after receipt of any such request and such funding of
indemnity, to give notice convening a meeting, the Trust or such
Debentureholders, as the case may be, may convene such meeting. Every such
meeting shall be held in the City of Toronto or at such other place as may be
approved or determined by the Trustee.
14.2 NOTICE OF MEETINGS
(a) At least 21 days' notice of any meeting shall be given to the
Debentureholders in the manner provided in Section 15.2 and a copy of
such notice shall be sent by post to the Trustee, unless the meeting
has been called by it. Such notice shall state the time when and the
place where the meeting is to be held and shall state briefly the
general nature of the business to be transacted there at and it shall
not be necessary for any such notice to set out the terms of any
resolution to be proposed or any of the provisions of this Article.
The accidental omission to give notice of a meeting to any
Debentureholder shall not invalidate any resolution passed at any such
meeting. A Debentureholder may waive notice of a meeting either before
or after the meeting.
(b) If the business to be transacted at any meeting by Extraordinary
Resolution or otherwise, or any action to be taken or power exercised
by instrument in writing under Section 14.15, especially affects the
rights of Debentureholders of one or
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more series in a manner or to an extent differing in any material way
from that in or to which the rights of Debentureholders of any other
series are affected, determined as provided in Sections I4.2(c) and
(d), then:
(i) a reference to such fact, indicating each series of Debentures in
the opinion of the Trustee relying on the advice of Counsel so
especially affected, hereinafter referred to as the "ESPECIALLY
AFFECTED SERIES", shall be made in the notice of such meeting,
and in any such case the meeting shall be and be deemed to be and
is herein referred to as a "SERIAL MEETING"; and
(ii) the Debentureholders of an especially affected series shall not
be bound by any action taken at a Serial Meeting or by instrument
in writing under Section 34.15 unless in addition to compliance
with the other provisions of this Article 14:
(A) at such Serial Meeting: (I) there are Debentureholders
present in person or by proxy and representing at least 25%
in principal amount of the Debentures then outstanding of
such series, subject to the provisions of this Article 14 as
to quorum at adjourned meetings; and (II) the resolution is
passed by the affirmative vote of the Debentureholders of
more than 50% (or in the case of an Extraordinary Resolution
not less than 66 2/3%) of the principal amount of the
Debentures of such series then outstanding voted on the
resolution; or
(B) in the case of action taken or power exercised by instrument
in writing under Section 14.15, such instrument is signed in
one or more counterparts by the Debentureholders of not less
than 66 2/3 in principal amount of the Debentures of such
series then outstanding.
(c) Subject to Section 14.2(d), the determination as to whether any
business to be transacted at a meeting of Debentureholders, or any
action to be taken or power to be exercised by instrument in writing
under Section 14.15, especially affects the rights of the
Debentureholders of one or more series in a manner or to an extent
differing in any material way from that in or to which it affects the
rights of Debentureholders of any other series (and is therefore an
especially affected series) shall be determined by an opinion of
Counsel, which shall be binding on all Debentureholders, the Trustee
and the Trust for all purposes hereof.
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(d) A proposal;
(i) to extend the maturity of Debentures of any particular series or
to reduce the principal amount thereof, the rate of interest or
redemption premium thereon or to impair any conversion right
thereof;
(ii) to modify or terminate any covenant or agreement which by its
terms is effective only so long as Debentures of a particular
series are outstanding; or
(iii) to reduce with respect to Debentureholders of any particular
series any percentage stated in this Section 14.2 or Sections
14.4, 14.12 and 14.15;
shall be deemed to especially affect the rights of the Debentureholders of such
series in a manner differing in a material way from that in which it affects the
rights of Debentureholders of any other series, whether or not a similar
extension, reduction, modification or termination is proposed with respect to
Debentures of any or all other series.
14.3 CHAIR
Some person, who need not be a Debentureholder, nominated in writing
by the Trustee shall be chair of the meeting and if no person is so nominated,
or if the person so nominated is not present within 15 minutes from the time
fixed for the holding of the meeting, a majority of the Debentureholders present
in person or by proxy shall choose some person present to be chair.
14.4 QUORUM
Subject to the provisions of Section 14.12, at any meeting of the
Debentureholders a quorum shall consist of Debentureholders present in person or
by proxy and representing at least 25% in principal amount of the outstanding
Debentures and, if the meeting is a Serial Meeting, at least 25% of the
Debentures then outstanding of each especially affected series. If a quorum of
the Debentureholders shall not be present within 30 minutes from the time fixed
for holding any meeting, the meeting, if summoned by the Debentureholders or
pursuant to a request of the Debentureholders, shall be dissolved, but in any
other case the meeting shall be adjourned to the same day in the next week
(unless such day is not a Business Day in which case it shall be adjourned to
the next following Business Day thereafter) at the same time and place and no
notice shall be required to be given in respect of such adjourned meeting. At
the adjourned meeting, the Debentureholders present in person or by proxy shall,
subject to the provisions of Section 14.12, constitute a quorum and may transact
the business for which the meeting was originally convened notwithstanding that
they may not represent 25% of the principal amount of the outstanding Debentures
or of the Debentures then outstanding of each especially affected series. Any
business may be brought before or dealt with at an adjourned meeting which might
have been brought before or dealt with at the original meeting in
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accordance with the notice calling the same. No business shall be transacted at
any meeting unless the required quorum be present at the commencement of
business.
14.5 POWER TO ADJOURN
The chair of any meeting at which a quorum of the Debentureholders is
present may, with the consent of the Debentureholders of a majority in principal
amount of the Debentures represented thereat, adjourn any such meeting and no
notice of such adjournment need be given except such notice, if any, as the
meeting may prescribe.
14.6 SHOW OF HANDS
Every question submitted to a meeting shall, subject to Section 14.7,
be decided in the first place by a majority of the votes given on a show of
hands except that votes on Extraordinary Resolutions shall be given in the
manner hereinafter provided. At any such meeting, unless a poll is duly demanded
as herein provided, a declaration by the chair that a resolution has been
carried or carried unanimously or by a particular majority or lost or not
carried by a particular majority shall be conclusive evidence of the fact. The
chair of any meeting shall be entitled, both on a show of hands and on a poll,
to vote in respect of the Debentures, if any, held by him or her.
14.7 POLL
On every Extraordinary Resolution, and on any other question submitted
to a meeting when demanded by the chair or by one or more Debentureholders or
proxies for Debentureholders, a poll shall be taken in such manner and either at
once or after an adjournment as the chair shall direct. Questions other than
Extraordinary Resolutions shall, if a poll be taken, be decided by the votes of
the Debentureholders of a majority in principal amount of the Debentures and of
each especially affected series, if applicable, represented at the meeting and
voted on the poll.
14.8 VOTING
On a show of hands every person who is present and entitled to vote,
whether as a Debentureholder or as proxy for one or more Debentureholders or
both, shall have one vote. On a poll each Debentureholder present in person or
represented by a proxy duly appointed by an instrument in writing shall be
entitled to one vote in respect of each $1,000 principal amount of Debentures of
which he or she shall then be the Debentureholder. In the case of any Debenture
denominated in a currency or currency unit other than Canadian dollars, the
principal amount thereof for these purposes shall be computed in Canadian
dollars on the basis of the conversion of the principal amount thereof at the
applicable spot buying rate of exchange for such other currency or currency unit
as reported by the Bank of Canada at the close of business on the Business Day
next preceding the meeting. Any fractional amounts resulting from such
conversion shall be rounded to the nearest $100. A proxy need not be a
Debentureholder. In the case of joint Debentureholders, any one of them present
in person or by proxy at the meeting
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may vote in the absence of the other or others but in case more than one of them
is present in person or by proxy, they shall vote together in respect of the
Debentures of which they are joint Debentureholders.
14.9 PROXIES
A Debentureholder may be present and vote at any meeting of
Debentureholders by an authorized representative. The Trust (in case it convenes
the meeting) or the Trustee (in any other case) for the purpose of enabling the
Debentureholders to be present and vote at any meeting without producing their
Debentures, and of enabling them to be present and vote at any such meeting by
proxy and of lodging instruments appointing such proxies at some place other
than the place where the meeting is to be held, may from time to time make and
vary such regulations as it shall think fit providing for and governing any or
all of the following matters;
(a) the form of the instrument appointing a proxy, which shall be in
writing, and the manner in which the same shall be executed and the
production of the authority of any person signing on behalf of a
Debentureholder;
(b) the deposit of instruments appointing proxies at such place as the
Trustee, the Trust or the Debentureholder convening the meeting, as
the case may be, may, in the notice convening the meeting, direct and
the time, if any, before the holding of the meeting or any adjournment
thereof by which the same must be deposited; and
(c) the deposit of instruments appointing proxies at some approved place
or places other than the place at which the meeting is to be held and
enabling particulars of such instruments appointing proxies to be
mailed, faxed, cabled, telegraphed or sent by telex before the meeting
to the Trust or to the Trustee at the place where the same is to be
held and for the voting of proxies so deposited as though the
instruments themselves were produced at the meeting.
Any regulations so made shall be binding and effective and the votes given in
accordance therewith shall be valid and shall be counted. Save as such
regulations may provide, the only persons who shall be recognized at any meeting
as the holders of any Debentures, or as entitled to vote or be present at the
meeting in respect thereof, shall be Debentureholders and persons whom
Debentureholders have by instrument in writing duly appointed as their proxies.
14.10 PERSONS ENTITLED TO ATTEND MEETINGS
The Trust, the Manager and the Trustee, by their respective trustees,
officers, employees and directors, the Auditors of the Trust and the legal
advisers of the Trust, the Trustee or any Debentureholder may attend any meeting
of the Debentureholders, but shall have no vote as such.
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14.11 POWERS EXERCISABLE BY EXTRAORDINARY RESOLUTION
In addition to the powers conferred upon them by any other provisions
of this Indenture or by law, a meeting of the Debentureholders shall have the
following powers exercisable from time to time by Extraordinary Resolution,
subject in the case of the matters in paragraphs (a), (b), (c), (d) and (1) to
receipt of the prior approval of the TSX:
(a) power to authorize the Trustee to grant extensions of time for payment
of any principal, premium or interest on the Debentures, whether or
not the principal, premium or interest, the payment of which is
extended, is at the time due or overdue;
(b) power to sanction any modification, abrogation, alteration, compromise
or arrangement of the rights of the Debentureholders or the Trustee
against the Trust (subject to the consent of the Trustee), or against
its property, whether such rights arise under this Indenture or the
Debentures or otherwise;
(c) power to assent to any modification of or change in or addition to or
omission from the provisions contained in this Indenture or any
Debenture which shall be agreed to by the Trust and to authorize the
Trustee to concur in and execute any indenture supplemental hereto
embodying any modification, change, addition or omission;
(d) power to sanction any scheme for the reconstruction, reorganization or
recapitalization of the Trust or for the consolidation, amalgamation
or merger of the Trust with any other Person or for the sale, leasing,
transfer or other disposition of all or substantially all of the
undertaking, property and assets of the Trust or any part thereof,
provided that no such sanction shall be necessary in respect of any
such transaction if the provisions of Section 12.1 shall have been
complied with;
(e) power to direct or authorize the Trustee to exercise any power, right,
remedy or authority given to it by this Indenture in any manner
specified in any such Extraordinary Resolution or to refrain from
exercising any such power, right, remedy or authority;
(f) power to waive and direct the Trustee to waive any default hereunder
and/or cancel any declaration made by the Trustee pursuant to Section
9.1 either unconditionally or upon any condition specified in such
Extraordinary Resolution;
(g) power to restrain any Debentureholder from taking or instituting any
suit, action or proceeding for the purpose of enforcing payment of the
principal, premium or interest on the Debentures, or for the execution
of any trust or power hereunder;
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(h) power to direct any Debentureholder who, as such, has brought any
action, suit or proceeding to stay or discontinue or otherwise deal
with the same upon payment, if the taking of such suit, action or
proceeding shall have been permitted by Section 9.5, of the costs,
charges and expenses reasonably and properly incurred by such
Debentureholder in connection therewith;
(i) power to assent to any compromise or arrangement with any creditor or
creditors or any class or classes of creditors, whether secured or
otherwise, and with holders of any units or other securities of the
Trust;
(j) power to appoint a committee with power and authority (subject to such
limitations, if any, as may be prescribed in the resolution) to
exercise, and to direct the Trustee to exercise, on behalf of the
Debentureholders, such of the powers of the Debentureholders as are
exercisable by Extraordinary Resolution or other resolution as shall
be included in the resolution appointing the committee. The resolution
making such appointment may provide for payment of the expenses and
disbursements of and compensation to such committee. Such committee
shall consist of such number of persons as shall be prescribed in the
resolution appointing it and the members need not be themselves
Debentureholders. Every such committee may elect its chair and may
make regulations respecting its quorum, the calling of its meetings,
the filling of vacancies occurring in its number and its procedure
generally. Such regulations may provide that the committee may act at
a meeting at which a quorum is present or may act by minutes signed by
the number of members thereof necessary to constitute a quorum. All
acts of any such committee within the authority delegated to it shall
be binding upon all Debentureholders. Neither the committee nor any
member thereof shall be liable for any loss arising from or in
connection with any action taken or omitted to be taken by them in
good faith;
(k) power to remove the Trustee from office and to appoint a new Trustee
or Trustees provided that no such removal shall be effective unless
and until a new Trustee or Trustees shall have become bound by this
Indenture;
(l) power to sanction the exchange of the Debentures for or the conversion
thereof into units, bonds, debentures or other securities or
obligations of the Trust or of any other Person formed or to be
formed;
(m) power to authorize the distribution in specie of any shares or
securities received pursuant to a transaction authorized under the
provisions of Section 14.11(1);
(n) power to require the Trustee to exercise any power, right or remedy or
authority given to it by this Indenture in any manner specified in
such Extraordinary Resolution, or to refrain from exercising any such
power, right, remedy or authority;
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(o) power to sanction any modification, abrogation, alteration, compromise
or arrangement of the rights of the Debentureholders against the
Trust, or against its property, whether such rights shall arise under
this Indenture or the Debentures or otherwise; and
(p) power to amend, alter or repeal any Extraordinary Resolution
previously passed or sanctioned by the Debentureholders or by any
committee appointed pursuant to Section 14.11 (j)-
14.12 MEANING OF "EXTRAORDINARY RESOLUTION"
(a) The expression "EXTRAORDINARY RESOLUTION" when used in this Indenture
means, subject as hereinafter in this Article provided, a resolution
proposed to be passed as an Extraordinary Resolution at a meeting of
Debentureholders (including an adjourned meeting) duly convened for
the purpose and held in accordance with the provisions of this Article
at which the Debentureholders of not less than 25% of the principal
amount of the Debentures then outstanding, and if the meeting is a
Serial Meeting, at which Debentureholders of not less than 25% of the
principal amount of the Debentures then outstanding of each especially
affected series, are present in person or by proxy and passed by the
favourable votes of the Debentureholders of not less than 66 2/3% of
the principal amount of the Debentures, and if the meeting is a Serial
Meeting by the affirmative vote of the Debentureholders of not less
than 66 2/3% of each especially affected series, in each case present
or represented by proxy at the meeting and voted upon on a poll on
such resolution.
(b) If, at any such meeting, the Debentureholders of not less than 25% of
the principal amount of the Debentures then outstanding and, if the
meeting is a Serial Meeting, 25% of the principal amount of the
Debentures then outstanding of each especially affected series, in
each case are not present in person or by proxy within 30 minutes
after the time appointed for the meeting, then the meeting, if
convened by or on the requisition of Debentureholders, shall be
dissolved but in any other case it shall stand adjourned to such date,
being not less than 14 not more than 60 days later, and to such place
and time as may be appointed by the chair. At the adjourned meeting
the Debentureholders present in person or by proxy shall form a quorum
and may transact the business for which the meeting was originally
convened and a resolution proposed at such adjourned meeting and
passed thereat by the affirmative vote of Debentureholders of not less
than 66 2/3% of the principal amount of the Debentures and, if the
meeting is a Serial Meeting, by the affirmative vote of the
Debentureholders of not less than 66 2/3% of the principal amount of
the Debentures of each especially affected series, in each case
present or represented by proxy at the meeting voted upon on a poll
shall be an Extraordinary Resolution within the meaning of this
Indenture, notwithstanding that the Debentureholders of not less than
25% in principal amount of the Debentures then outstanding, and if the
meeting is a Serial Meeting, at which
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Debentureholders of not less than 25% of the principal amount of the
Debentures then outstanding of each especially affected series, are
not present in person or by proxy at such adjourned meeting.
(c) Votes on an Extraordinary Resolution shall always be given on a poll
and no demand for a poll on an Extraordinary Resolution shall be
necessary.
14.13 POWERS CUMULATIVE
Any one or more of the powers in this Indenture stated to be
exercisable by the Debentureholders by Extraordinary Resolution or otherwise may
be exercised from time to time and the exercise of any one or more of such
powers from time to time shall not be deemed to exhaust the rights of the
Debentureholders to exercise the same or any other such power or powers
thereafter from time to time.
14.14 MINUTES
Minutes of all resolutions and proceedings at every meeting as
aforesaid shall be made and duly entered in books to be from time to time
provided for that purpose by the Trustee at the expense of the Trust, and any
such minutes as aforesaid, if signed by the chair of the meeting at which such
resolutions were passed or proceedings had, or by the chair of the next
succeeding meeting of the Debentureholders, shall be prima facie evidence of the
matters therein stated and, until the contrary is proved, every such meeting, in
respect of the proceedings of which minutes shall have been made, shall be
deemed to have been duly held and convened, and all resolutions passed thereat
or proceedings taken thereat to have been duly passed and taken.
14.15 INSTRUMENTS IN WRITING
All actions which may be taken and all powers that may be exercised by
the Debentureholders at a meeting held as hereinbefore in this Article provided
may also be taken and exercised by the Debentureholders of 66 2/3% of the
principal amount of all the outstanding Debentures and, if the meeting at which
such actions might be taken would be a Serial Meeting, by the Debentureholders
of 66 2/3% of the principal amount of the Debentures then outstanding of each
especially affected series, by an instrument in writing signed in one or more
counterparts and the expression "EXTRAORDINARY RESOLUTION" when used in this
Indenture shall include an instrument so signed.
14.16 BINDING EFFECT OF RESOLUTIONS
Every resolution and every Extraordinary Resolution passed in
accordance with the provisions of this Article at a meeting of Debentureholders
shall be binding upon all the Debentureholders, whether present at or absent
from such meeting, and every instrument in writing signed by Debentureholders in
accordance with Section 14.15 shall be binding upon all the Debentureholders,
whether signatories thereto or not, and each and every Debentureholder and the
Trustee (subject to the provisions for its indemnity herein contained) shall be
bound to
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give effect accordingly to every such resolution, Extraordinary Resolution and
instrument in writing.
14.17 EVIDENCE OF RIGHTS OF DEBENTUREHOLDERS
(a) Any request, direction, notice, consent or other instrument which this
Indenture may require or permit to be signed or executed by the
Debentureholders may be in any number of concurrent instruments of
similar tenor signed or executed by such Debentureholders.
(b) The Trustee may, in its discretion, require proof of execution in
cases where it deems proof desirable and may accept such proof as it
shall consider proper.
14.18 CONCERNING SERIAL MEETINGS
If in the opinion of Counsel any business to be transacted at any
meeting, or any action to be taken or power to be exercised by instrument in
writing under Section 14.15, does not adversely affect the rights of the
Debentureholders of one or more series, the provisions of this Article 14 shall
apply as if the Debentures of such series were not outstanding and no notice of
any such meeting need be given to the Debentureholders of such series. Without
limiting the generality of the foregoing, a proposal to modify or terminate any
covenant or agreement which is effective only so long as Debentures of a
particular series are outstanding shall be deemed not to adversely affect the
rights of the Debentureholders of any other series.
ARTICLE I5
NOTICES
15.1 NOTICE TO TRUST AND TRUSTEE
Unless herein otherwise expressly provided, any notice to be given
hereunder to the Trust or the Trustee shall be deemed to be validly given if
delivered by hand courier or if transmitted by facsimile to:
(i) if to the Trust:
Algonquin Power Income Fund
0000 Xxxxxxx Xxxxxx
Xxxxxxxx, XX X0X 0X0
Attention: President
Facsimile: (000) 000-0000
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(ii) if to the Trustee:
CIBC Mellon Trust Company
000 Xxx Xxxxxx
Xxxxxxx, XX X0X 0X0
Attention: Manager, Corporate Trust Services
Facsimile: (000) 000-0000
and any such notice delivered in accordance with the foregoing shall be deemed
to have been received on the date of delivery or, if faxed the day of
transmission or, if such day is not a Business Day, on the first Business Day
following the day of transmission; provided that if such notice is delivered or
faxed after 4 p.m. (Toronto time), such notice will be deemed to be received on
the next Business Day. The Trust or Trustee, as the case may be, may from time
to time notify the other in the manner provided in this Section 15.1 of a change
of address which from the effective date of such notice and until changed by
like notice, shall be the address of the Trust or Trustee, as the case may be,
for all purposes of this Indenture.
15.2 NOTICE TO DEBENTUREHOLDERS
All notices to be given hereunder with respect to the Debentures shall
be deemed to be validly given to the Debentureholders thereof if sent by first
class mail, postage prepaid, by letter or circular addressed to such
Debentureholders at their post office addresses appearing in any of the
registers hereinbefore mentioned and shall be deemed to have been effectively
given three Business Days following the day of mailing. Accidental error or
omission in giving notice or accidental failure to mail notice to any
Debentureholder or the inability of the Trust to give or mail any notice due to
anything beyond the reasonable control of the Trust shall not invalidate any
action or proceeding founded thereon.
If any notice given in accordance with the foregoing paragraph would
be unlikely to reach the Debentureholders to whom it is addressed in the
ordinary course of post by reason of an interruption in mail service, whether at
the place of dispatch or receipt or both, the Trust shall give such notice by
publication at least once in the City of Toronto, such publication to be made in
a daily newspaper of national circulation.
Any notice given to Debentureholders by publication shall be deemed to
have been given on the day on which publication shall have been effected at
least once in the newspaper in which publication was required.
All notices with respect to any Debenture may be given to whichever
one of the Debentureholders thereof (if more than one) is named first in the
registers hereinbefore mentioned, and any notice so given shall be sufficient
notice to all holders of any Persons interested in such Debenture.
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15.3 MAIL SERVICE INTERRUPTION
If by reason of any interruption of mail service, actual or
threatened, any notice to be given to the Trustee would reasonably be unlikely
to reach its destination by the time notice by mail is deemed to have been given
pursuant to Section 15.1, such notice shall be valid and effective only if
delivered at the appropriate address in accordance with Section 15.1.
ARTICLE 16
CONCERNING THE TRUSTEE
16.1 NO CONFLICT OF INTEREST
The Trustee represents to the Trust that at the date of execution and
delivery by it of this Indenture there exists no material conflict of interest
in the role of the Trustee as a fiduciary hereunder but if, notwithstanding the
provisions of this Section 16.1, such a material conflict of interest exists, or
hereafter arises, the validity and enforceability of this Indenture, and the
Debentures issued hereunder, shall not be affected in any manner whatsoever by
reason only that such material conflict of interest exists or arises but the
Trustee shall, within 90 days after ascertaining that it has a material conflict
of interest, either eliminate such material conflict of interest or resign in
the manner and with the effect specified in Section 16.2.
16.2 REPLACEMENT OF TRUSTEE
The Trustee may resign its trust and be discharged from all further
duties and liabilities hereunder by giving to the Trust two months notice in
writing or such shorter notice as the Trust may accept as sufficient. The Trust
shall have the power, at any time, on reasonable notice in writing to the
Trustee and the Debentureholders shall have the power by Extraordinary
Resolution, at any time, to remove the existing Trustee and appoint a new or
successor Trustee. If at any time a material conflict of interest exists in the
Trustee's role as a fiduciary hereunder the Trustee shall, within 90 days after
ascertaining that such a material conflict of interest exists, either eliminate
such material conflict of interest or resign in the manner and with the effect
specified in this Section 16.2. The validity and enforceability of this
Indenture and of the Debentures issued hereunder shall not be affected in any
manner whatsoever by reason only that such a material conflict of interest
exists. In the event of the Trustee resigning or being removed or being
dissolved, becoming bankrupt, going into liquidation or otherwise becoming
incapable of acting hereunder, the Trust shall forthwith appoint a new Trustee
unless a new Trustee has already been appointed by the Debentureholders. Failing
such appointment by the Trust, the retiring Trustee or any Debentureholder may
apply to a Judge of the Ontario Superior Court of Justice, on such notice as
such Judge may direct at the Trust's expense, for the appointment of a new
Trustee but any new Trustee so appointed by the Trust or by such court shall be
subject to removal as aforesaid by the Debentureholders and the appointment of
such new Trustee shall be effective only upon such new Trustee becoming bound by
this Indenture. Any new Trustee appointed under any provision of this Section
16.2 shall be a corporation authorized to carry on the business of a trust
company in all of the Provinces of Canada. On any new appointment the
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new Trustee shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as Trustee.
Any company into which the Trustee may be merged or with which it may
be consolidated or amalgamated or any company resulting from any merger,
consolidation or amalgamation to which the Trustee shall be a party, shall be
the successor trustee under this Indenture without the execution of any
instrument or any further act. Nevertheless, upon the written request of the
successor Trustee or of the Trust, the Trustee ceasing to act shall execute and
deliver an instrument assigning and transferring to such successor Trustee, upon
the trusts herein expressed, all the rights, powers and trusts of the Trustee so
ceasing to act, and shall duly assign, transfer and deliver all property and
money held by such Trustee to the successor Trustee so appointed in its place.
Should any deed, conveyance or instrument in writing from the Trust be required
by any new Trustee or more fully and certainly vesting in and confirming to it
such estates, properties, rights, powers and trusts, then any and all such
deeds, conveyances and instruments in writing shall on request of said new
Trustee, be made, executed, acknowledged and delivered by the Trust.
16.3 DUTIES OF TRUSTEE
In the exercise of the rights, duties and obligations prescribed or
conferred by the terms of this Indenture, the Trustee shall act honestly and in
good faith with a view to the best interests of the Debentureholders and shall
exercise that degree of care, diligence and skill that a reasonably prudent
corporate trustee would exercise in comparable circumstances.
16.4 RELIANCE UPON DECLARATIONS, OPINIONS, ETC.
In the exercise of its rights, duties and obligations hereunder the
Trustee may, if acting in good faith, rely, as to the truth of the statements
and accuracy of the opinions expressed therein, upon statutory declarations,
opinions, reports or certificates furnished pursuant to any covenant, condition
or requirement of this Indenture or required by the Trustee to be furnished to
it in the exercise of its rights and duties hereunder. The Trustee may
nevertheless, in its discretion, require further proof in cases where it deems
further proof desirable. Without restricting the foregoing, the Trustee may act
and rely on an opinion of Counsel satisfactory to the Trustee notwithstanding
that it is delivered by a solicitor or firm which acts as solicitors for the
Trust.
16.5 EVIDENCE AND AUTHORITY TO TRUSTEE, OPINIONS, ETC.
The Trust shall furnish to the Trustee evidence of compliance with the
conditions precedent provided for in this Indenture relating to any action or
step required or permitted to be taken by the Trust or the Trustee under this
Indenture or as a result of any obligation imposed under this Indenture,
including without limitation, the certification and delivery of Debentures
hereunder, the satisfaction and discharge of this Indenture and the taking of
any other action to be taken by the Trustee at the request of or on the
application of the Trust, forthwith if and when (a) such evidence is required by
any other Section of this Indenture to be furnished by the
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Trustee in accordance with the terms of this Section 16.5 or (b) the Trustee, in
the exercise of its rights and duties under this Indenture, gives the Trust
written notice requiring it to furnish such evidence in relation to any
particular action or obligation specified in such notice.
Such evidence shall consist of:
(a) a certificate made by any one officer or trustee of the Trust stating
that any such condition precedent has been complied with in accordance
with the terms of this Indenture;
(b) in the case of a condition precedent compliance with which is, by the
terms of this Indenture, made subject to review or examination by a
solicitor, an opinion of Counsel that such condition precedent has
been complied with in accordance with the terms of this Indenture; and
(c) in the case of any such condition precedent compliance with which is
subject to review or examination by auditors or accountants, an
opinion or report of the Auditors of the Trust whom the Trustee for
such purposes hereby approves, that such condition precedent has been
complied with in accordance with the terms this Indenture.
Whenever such evidence relates to a matter other than the
certification and delivery of Debentures and the satisfaction and discharge of
this Indenture, and except as otherwise specifically provided herein, such
evidence may consist of a report or opinion of any solicitor, auditor,
accountant, engineer or appraiser or any other person whose qualifications give
authority to a statement made by him or her, provided that if such report or
opinion is furnished by a trustee, officer or employer of the Trust it shall be
in the form of a statutory declaration. Such evidence shall be, so far as
appropriate, in accordance with the immediately preceding paragraph of this
Section.
Each statutory declaration, certificate, opinion or report with
respect to compliance with a condition precedent provided for in the Indenture
shall include (a) a statement by the person giving the evidence that he has read
and is familiar with those provisions of this Indenture relating to the
condition precedent in question, (b) a brief statement of the nature and scope
of the examination or investigation upon which the statements or opinions
contained in such evidence are based, (c) a statement that, in the belief of the
person giving such evidence, the person has made such examination or
investigation as is necessary to enable him or her to make the statements or
give the opinions contained or expressed therein, (d) a statement whether in the
opinion of such person the conditions precedent in question have been complied
with or satisfied, and (e) no default or Event of Default has occurred or will
occur by reason of the action taken.
The Trust shall furnish to the Trustee at any time if the Trustee
reasonably so requires, its certificate that the Trust has complied with all
covenants, conditions or other requirements contained in this Indenture, the
non-compliance with which would, with the giving
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of notice or the lapse of time, or both, or otherwise, constitute an Event of
Default, or if such is not the case, specifying the covenant, condition or other
requirement which has not been complied with and giving particulars of such
non-compliance. The Trust shall, whenever the Trustee so requires, furnish the
Trustee with evidence by way of statutory declaration, opinion, report or
certificate as specified by the Trustee as to any action or step required or
permitted to be taken by the Trust or as a result of any obligation imposed by
this Indenture.
16.6 OFFICER'S CERTIFICATES EVIDENCE
Except as otherwise specifically provided or prescribed by this
Indenture, whenever in the administration of the provisions of this Indenture
the Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking or omitting any action hereunder, the Trustee, if
acting in good faith, may rely upon an Officer's Certificate.
16.7 EXPERTS, ADVISERS AND AGENTS
The Trustee may:
(a) employ or retain and act and rely on the opinion or advice of or
information obtained from any solicitor, auditor, valuer, engineer,
surveyor, appraiser or other expert, whether obtained by the Trustee
or by the Trust, or otherwise, and shall not be liable for acting, or
refusing to act, in good faith on any such opinion or advice and may
pay proper and reasonable compensation for all such legal and other
advice or assistance as aforesaid; and
(b) employ such agents and other assistants as it may reasonably require
for the proper determination and discharge of its duties hereunder,
and may pay reasonable remuneration for all services performed for it
(and shall be entitled to receive reasonable remuneration for all
services performed by it) in the discharge of the trusts hereof and
compensation for all disbursements, costs and expenses made or
incurred by it in the discharge of its duties hereunder and in the
management of the trusts hereof any solicitors employed or consulted
by the Trustee may, but need not be, solicitors for the Trust.
16.8 TRUSTEE MAY DEAL IN DEBENTURES
Subject to Sections 16.1 and 16.3, the Trustee may, in its personal or
other capacity, buy, sell, lend upon and deal in the Debentures and generally
contract and enter into financial transactions with the Trust or otherwise,
without being liable to account for any profits made thereby.
16.9 INVESTMENT OF MONEYS HELD BY TRUSTEE
Upon receipt of a written direction from the Manager on behalf of the
Trust, the Trustee shall invest the funds in its name in accordance with such
direction. Any direction from
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the Manager on behalf of the Trust to the Trustee shall be in writing and shall
be provided to the Trustee no later than 9:00 a.m. on the day on which the
investment is to be made. Any such direction received by the Trustee after 9:00
a.m. or received on a non-Business Day, shall be deemed to have been given prior
to 9:00 a.m. the next Business Day. For the purpose hereof, "AUTHORIZED
INVESTMENTS" means short term interest bearing or discount debt obligations
issued or guaranteed by the Government of Canada or a Province or a Canadian
chartered bank (which may include an Affiliate or related party of the Trustee)
provided that such obligation is rated at least Rl (middle) by DBRS Inc. or an
equivalent rating service.
In addition to any written direction to invest cash in an Authorized
Investment, the Trustee may hold cash balances constituting part or all of the
Trust and may, but need not, invest same in its deposit department or the
deposit department of one of its Affiliates; but the Trustee and its Affiliates
shall not be liable to account for any profit to any parties to this Agreement
or to any other Person or entity other than at a rate, if any, established from
time to time by the Trustee or one of its Affiliates. For the purpose of this
Section "AFFILIATE" means affiliated companies within the meaning of the
Business Corporations Act (Ontario) ("OBCA"); and includes Canadian Imperial
Bank of Commerce, CIBC Mellon Global Securities Services Company and Mellon
Bank, N.A. and each of their affiliates within the meaning of the OBCA.
The Trustee shall not be held liable for any losses incurred in the
investment of any funds in Authorized Investments.
Unless and until the Trustee shall have declared the principal of and
interest on the Debentures to be due and payable, the Trustee shall pay over to
the Trust all interest received by the Trustee in respect of any Investments or
deposits made pursuant to the provisions of this Section.
16.10 TRUSTEE NOT ORDINARILY BOUND
Except as provided in Section 9.2 and as otherwise specifically
provided herein, the Trustee shall not, subject to Section 16.3, be bound to
give notice to any Person of the execution hereof, nor to do, observe or perform
or see to the observance or performance by the Trust of any of the obligations
herein imposed upon the Trust or of the covenants on the part of the Trust
herein contained, nor in any way to supervise or interfere with the conduct of
the Trust's business, unless the Trustee shall have been required to do so in
writing by the Debentureholders of not less than 25% of the aggregate principal
amount of the Debentures then outstanding or by any Extraordinary Resolution of
the Debentureholders passed in accordance with the provisions contained in
Article 14, and then only after it shall have been funded and indemnified to its
satisfaction against all actions, proceedings, claims and demands to which it
may render itself liable and all costs, charges, damages and expenses which it
may incur by so doing.
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16.11 TRUSTEE NOT REQUIRED TO GIVE SECURITY
The Trustee shall not be required to give any bond or security in
respect of the execution of the trusts and powers of this Indenture or otherwise
in respect of the premises.
16.12 TRUSTEE NOT BOUND TO ACT ON TRUST'S REQUEST
Except as in this Indenture otherwise specifically provided, the
Trustee shall not be bound to act in accordance with any direction or request of
the Trust or of the trustees until a duly authenticated copy of the instrument
or resolution containing such direction or request shall have been delivered to
the Trustee, and the Trustee shall be empowered to act upon any such copy
purporting to be authenticated and believed by the Trustee to be genuine.
16.13 CONDITIONS PRECEDENT TO TRUSTEE'S OBLIGATIONS TO ACT HEREUNDER
The obligation of the Trustee to commence or continue any act, action
or proceeding for the purpose of enforcing the rights of the Trustee and of the
Debentureholders hereunder shall be conditional upon the Debentureholders
furnishing when required by notice in writing by the Trustee, sufficient funds
to commence or continue such act, action or proceeding and indemnity reasonably
satisfactory to the Trustee to protect and hold harmless the Trustee against the
costs, charges and expenses and liabilities to be incurred thereby and any loss
and damage it may suffer by reason thereof.
The Trustee shall not be bound to give any notice or do or take any
act, action or proceeding by virtue of the powers conferred on it hereby unless
and until it shall have been required so to do under the terms hereof; nor shall
the Trustee be required to take notice of any default hereunder, unless and
until notified in writing of such default, which notice shall distinctly specify
the default desired to be brought to the attention of the Trustee and in the
absence of any such notice the Trustee may for all purposes of this Indenture
conclusively assume that no default has been made in the observance or
performance of any of the representations, warranties, covenants, agreements or
conditions contained herein. Any such notice shall in no way limit any
discretion herein given the Trustee to determine whether or not the Trustee
shall take action with respect to any default.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties or in the exercise of any of its rights
or powers unless indemnified as aforesaid.
The Trustee may, before commencing or at any time during the
continuance of any such act, action or proceeding require the Debentureholders
at whose instance it is acting to deposit with the Trustee the Debentures held
by them for which Debentures the Trustee shall issue receipts.
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16.14 AUTHORITY TO CARRY ON BUSINESS
The Trustee represents to the Trust that at the date of execution and
delivery by it of this Indenture it is authorized to carry on the business of a
trust company in each of the Provinces of Canada but if, notwithstanding the
provisions of this Section 16.14, it ceases to be so authorized to carry on
business, the validity and enforceability of this Indenture and the securities
issued hereunder shall not be affected in any manner whatsoever by reason only
of such event but the Trustee shall, within 90 days after ceasing to be
authorized to carry on the business of trust company in any of the Provinces of
Canada either become so authorized or resign in the manner and with the effect
specified in Section 16.2.
16.15 COMPENSATION AND INDEMNITY
(a) The Trust shall pay to the Trustee from time to time compensation for
its services hereunder as agreed separately by the Trust and the
Trustee, and shall pay or reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made
by the Trustee in the administration or execution of its duties under
this Indenture (including the reasonable and documented compensation
and disbursements of its counsel and all other advisers and assistants
not regularly in its employ), both before any default hereunder and
thereafter until all duties of the Trustee under this Indenture shall
be finally and fully performed. The Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express
trust.
(b) The Trust hereby indemnifies and saves harmless the Trustee and its
directors, officers and employees from and against any and all loss,
damages, charges, expenses, claims, demands, actions or liability
whatsoever which may be brought against the Trustee or which it may
suffer or incur as a result of or arising out of the performance of
its duties and obligations hereunder save only in the event of the
gross negligent failure to act, or the wilful misconduct or bad faith
of the Trustee. This indemnity will survive the termination or
discharge of this Indenture and the resignation or removal of the
Trustee. The Trustee shall notify the Trust promptly of any claim for
which it may seek indemnity. The Trust shall defend the claim and the
Trustee shall co-operate in the defence. The Trustee may have separate
counsel and the Trust shall pay the reasonable fees and expenses of
such counsel. The Trust need not pay for any settlement made without
its consent, which consent must not be unreasonably withheld. This
indemnity shall survive the resignation or removal of the Trustee or
the discharge of this Indenture.
(c) The Trust need not reimburse any expense or indemnify against any loss
or liability incurred by the Trustee through gross negligence or bad
faith or reckless disregard of the Trustee's duties hereunder.
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16.16 ACCEPTANCE OF TRUST
The Trustee hereby accepts the trusts in this Indenture declared and
provided for and agrees to perform the same upon the terms and conditions herein
set forth and to hold all rights, privileges and benefits conferred hereby and
by law in trust for the various Persons who shall from time to time be
Debentureholders, subject to all the terms and conditions herein set forth.
16.17 ASSIGNMENT AND ENUREMENT
The parties hereto acknowledge and agree, and any beneficiaries
hereunder are hereby deemed to have acknowledged and agreed that the Trustee
may, without the consent of any other party, assign all of its rights and duties
under this Indenture, and under any ancillary agreements executed in connection
herewith, to such federal trust company as may result from CIBC Mellon Trust
Company being continued as a trust company pursuant to the terms of the Trust
and Loan Companies Act (Canada). Any such assignment shall be effective without
the need for any further notice or advice to, or approval of, the parties hereto
and without any further act or formality whatsoever.
ARTICLE 17
SUPPLEMENTAL INDENTURES
17.1 SUPPLEMENTAL INDENTURES
From time to time the Trustee and, when authorized by a resolution of
the trustees, the Trust, may, and they shall when required by this Indenture,
execute, acknowledge and deliver by their proper officers deeds or indentures
supplemental hereto which thereafter shall form part hereof, for any one or more
of the following purposes:
(a) providing for the issuance of Additional Debentures under this
Indenture;
(b) adding to the covenants of the Trust herein contained for the
protection of the Debentureholders, or of the Debentures of any
series, or providing for events of default, in addition to those
herein specified;
(c) making such provisions not inconsistent with this Indenture as may be
necessary or desirable with respect to matters or questions arising
hereunder, including the making of any modifications in the form of
the Debentures which do not affect the substance thereof and which in
the opinion of the Trustee relying on an opinion of counsel will not
be prejudicial to the interests of the Debentureholders;
(d) evidencing the succession, or successive successions, of others to the
Trust and the covenants of and obligations assumed by any such
successor in accordance with the provisions of this Indenture;
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(e) giving effect to any Extraordinary Resolution passed as provided in
Article 14;
(f) approving amendments to this Indenture which, in the opinion of the
Trustee relying on the advice of counsel, are necessary or desirable
to prevent the assets of the Trust from being treated for any purpose
of ERISA or Section 4975 of the U.S. Tax Code as assets of any
"employee benefit pian", as defined in Section 3 of ERISA, that is
subject to Title I of ERISA, or of any "plan" as defined in, and
subject to, Section 4975 of the U.S. Tax Code or to prevent the Trust
or any Affiliate of the Trust, or the Manager, from engaging in a
"prohibited transaction" described in Section 406 of ERISA or as
defined in Section 4975(c) of the U.S. Tax Code; and
(g) for any other purpose not inconsistent with the terms of this
Indenture.
Unless the supplemental indenture requires that the consent or
concurrence of Debentureholders by Extraordinary Resolution is required, the
consent or concurrence of Debentureholders shall not be required in connection
with the execution, acknowledgement or delivery of a supplemental indenture for
the foregoing purposes. Further, the Trust and the Trustee may without the
consent or concurrence of the Debentureholders, by supplemental indenture or
otherwise, make any changes or corrections in this Indenture which it shall have
been advised by Counsel are required for the purpose of curing or correcting any
ambiguity or defective or inconsistent provisions or clerical omissions or
mistakes or manifest errors contained herein or in any indenture supplemental
hereto or any Written Direction of the Trust providing for the issue of
Debentures, providing that in the opinion of the Trustee (relying upon an
opinion of counsel) the rights of the Debentureholders are in no way prejudiced
thereby.
ARTICLE 18
EXECUTION AND FORMAL DATE
18.1 EXECUTION
This Indenture may be simultaneously executed in several counterparts,
each of which when so executed shall be deemed to be an original and such
counterparts together shall constitute one and the same instrument. Each party
shall be entitled to rely on the delivery of a facsimile copy of this Indenture,
and acceptance by any party of such facsimile shall be legally effective to
create a valid and binding agreement between the parties in accordance with the
terms hereof.
18.2 FORMAL DATE
For the purpose of convenience this Indenture may be referred to as
bearing the formal date of July 20, 2004, irrespective of the actual date of
execution hereof.
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IN WITNESS whereof the parties hereto have executed these presents
under their respective corporate seals and the hands of their proper officers in
that behalf.
ALGONQUIN POWER INCOME FUND,
BY ITS MANAGER, ALGONQUIN
POWER MANAGEMENT INC.
By: (signed) "Xxxxx Xxxx"
------------------------------------
Name: Xxxxx Xxxx
Title: Authorized Signing Authority
CIBC MELLON TRUST COMPANY
By: (signed) "Lennox August"
------------------------------------
Name: Lennox August
Title: Associate Maanger
By: (signed) "Xxxxxxx Petryla"
------------------------------------
Name: Xxxxxxx Petryla
Title: Account Manager
SCHEDULE "A"
TO THE TRUST INDENTURE BETWEEN
ALGONQUIN POWER INCOME FUND
AND
CIBC MELLON TRUST COMPANY
FORM OF DEBENTURE
SCHEDULE "A"
FORM OF DEBENTURE
ALGONQUIN POWER INCOME FUND
(A trust governed by the laws of Ontario)
6.65% CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES
DUE JULY 31, 2011
No. ______________ CUSIP 015910 AA0
ALGONQUIN POWER INCOME FUND (the "Trust") for value received hereby
acknowledges itself indebted and, subject to the provisions of the Trust
Indenture (the "Indenture") dated as of __, 2004 between the Trust and CIBC
Mellon Trust Company (the "Trustee"), promises to pay to the registered
Debentureholder hereof on July 31, 2011 (the "Maturity Date") or on such earlier
date as the principal amount hereof may become due in accordance with the
provisions of the indenture the principal sum of
_______________________________________________________________________ DOLLARS
in lawful money of Canada on presentation and surrender of this Initial
Debenture at the main branch of the Trustee in Xxxxxxx, Xxxxxxx, in accordance
with the terms of the Indenture and, subject as hereinafter provided, to pay
interest on the principal amount hereof from the date hereof, or from the last
Interest Payment Date to which interest shall have been paid or made available
for payment hereon, whichever is later, at the rate of 6.65% per annum, in like
money in arrears in equal semi-annual instalments (less any tax required by law
to be deducted) on July 31 and January 31 in each year, except the first such
payment to fall due on January 31, 2005 in the amount of $35.7096 per $1,000
principal amount of Initial Debentures and, should the Trust at any time make
default in the payment of any principal or Interest, to pay interest on the
amount in default at the same rate, in like money and on the same dates.
Interest hereon shall be payable by cheque or by electronic transfer
of funds transferred to the registered Debentureholder hereof and, subject to
the provisions of the Indenture, the mailing of such cheque or electronic
transfer of funds, as the case may be, shall, to the extent of the sum
represented thereby (plus the amount of any tax withheld), satisfy and discharge
all liability for interest on this Initial Debenture.
This Debenture is one of the Debentures of the Trust issued or
issuable in one or more series under the provisions of the Indenture
(individually an "Initial Debenture" and collectively the "Initial Debentures").
However, subject to the terms of the Indenture, additional debentures may be
issued pursuant to the Indenture after the date hereof. The Initial Debentures
are limited to an aggregate principal amount of $85,000,000 in lawful money of
Canada. Reference is hereby expressly made to the Indenture for a description of
the terms and conditions upon which the Initial Debentures are or are to be
issued and held and the rights and remedies of the Debentureholders of the
Initial Debentures and of the Trust and of the Trustee, all to the same
-2-
effect as if the provisions of the Indenture were herein set forth to all of
which provisions the Debentureholder of this Initial Debenture by acceptance
hereof assents.
The Initial Debentures are issuable only in denominations of $1,000
and integral multiples thereof. Upon compliance with the provisions of the
Indenture, Initial Debentures of any denomination may be exchanged for an equal
aggregate principal amount of Initial Debentures in any other authorized
denomination or denominations.
The whole, or if this Initial Debenture is in a denomination in excess
of $1,000 any part of which is $1,000 or an integral multiple thereof, of the
principal of this Initial Debenture is convertible, at the option of the
Debentureholder hereof, upon surrender of this Initial Debenture at the
principal office of the Trustee in the Cities of Calgary, Montreal and Toronto,
Ontario, at any time prior to the close of business on the Maturity Date or, if
this Initial Debenture is called for redemption on or prior to such date, then
at any time, but not after the close of business on the last Business Day
immediately preceding the date specified for redemption of this Initial
Debenture, into Trust Units of the Trust (without adjustment for dividends or
distributions on Trust Units issuable upon conversion) at a conversion price of
$10.65 (the "Conversion Price") per Trust Unit, being a rate of 93.8967 Trust
Units for each $1,000 principal amount of Initial Debentures, all subject to the
terms and conditions and in the manner set forth in the Indenture. The Indenture
makes provision for the adjustment of the Conversion Price in the events therein
specified. No fractional Trust Units will be issued on any conversion but in
lieu thereof, the Trust will satisfy such fractional interest by a cash payment
equal to the market price of such fractional interest as determined in
accordance with the Indenture.
The Initial Debenture may be redeemed at the option of the Trust on
the terms and conditions set out in the Indenture at the redemption price
therein set out. This Initial Debenture is not redeemable on or before July 31,
2007, except in the event of the satisfaction of certain conditions after a
Change of Control has occurred. After July 31, 2007, and on or prior to July 31,
2009, this Initial Debenture is redeemable at the option of the Trust in whole
or in part at a price equal to the principal amount of the Initial Debentures
(the "Redemption Price") provided that the Trust files with the Trustee on the
date that notice of redemption of this Initial Debenture is first provided, an
Officer's Certificate of the Trust certifying that the weighted average price of
the Trust Units on The TSX (or elsewhere in accordance with the Indenture) for
20 consecutive trading days, ending on the fifth trading day preceding the date
notice is given (the "Current Market Price"), is at least 125% of the Conversion
Price then in effect and otherwise on the terms and conditions described in the
Indenture. In addition thereto, at the time of redemption, the Trust shall pay
to the holder any accrued and unpaid interest. After July 31, 2009 and prior to
the Maturity Date, this Initial Debenture may be redeemed at the option of the
Trust in whole or in part from time to time on notice, at the Redemption Price
irrespective of the Current Market Price and otherwise on the terms and
conditions described in the Indenture. In addition thereto, at the time of
redemption, the Trust shall pay to the Debentureholder hereof, accrued and
unpaid interest.
Upon the occurrence of a Change of Control of the Trust involving the
acquisition of voting control or direction over 66 2/3% or more of the Trust
Units of the Trust, each
-3-
Debentureholder of Initial Debentures may require the Trust to purchase on the
date that is 30 days following the giving of notice of the Change of Control
(the "Put Date") the whole or any part of such Debentureholder's Initial
Debentures at a price equal to 101% of the principal amount of such Initial
Debentures plus accrued and unpaid interest, if any, up to, but excluding, the
date the Initial Debentures are so repurchased. The Trust, at its option, may
elect to satisfy the principal portion of such purchase price either by payment
in cash or by the issuance of Trust Units to the Trust. If 90% or more of the
principal amount of all Initial Debentures outstanding on the date the Trust
provides notice of a Change of Control to the Trustee have been tendered for
purchase on the Put Date, the Trust has the right to purchase all the remaining
outstanding Initial Debentures on the same date and at the same price, together
with accrued and unpaid interest to such date.
If a takeover bid for Initial Debentures, within the meaning of the
Securities Act (Ontario) is made and 90% or more of the principal amount of all
the Initial Debentures (other than Initial Debentures held at the date of the
takeover bid by or on behalf of the Offeror, Associates or Affiliates of the
Offeror or anyone acting jointly or in concert with the Offeror) are taken up
and paid for by the Offeror, the Offeror will be entitled to acquire the Initial
Debentures of those Debentureholders who did not accept the offer on the same
terms as the Offeror acquired the first 90% of the principal amount of the
initial Debentures.
The Trust may, on notice as provided in the Indenture, at its option
and (subject to any applicable regulatory approval), elect to satisfy the
obligation to repay all or any portion of the principal amount of this Initial
Debenture on the Maturity Date or on redemption by the issue of that number of
Freely Tradable Trust Units obtained by dividing that portion of the principal
amount of this Initial Debenture that the Trust elects to satisfy by the issue
of Freely Tradable Trust Units by 95% of the Current Market Price on the
Maturity Date or the date fixed for redemption, as the case may be.
The indebtedness evidenced by this Initial Debenture, and by all other
Initial Debentures now or hereafter certified and delivered under the Indenture,
is a direct unsecured obligation of the Trust, and is subordinated in right of
payment, to the extent and in the manner provided in the Indenture, to the prior
payment of all Senior Indebtedness, including any indebtedness to trade
creditors, whether outstanding at the date of the Indenture or thereafter
created, incurred, assumed or guaranteed.
The principal hereof may become or be declared due and payable before
the stated maturity in the events, in the manner, with the effect and at the
times provided in the Indenture.
The Indenture contains provisions making binding upon all
Debentureholders of Debentures outstanding thereunder (or in certain
circumstances, specific series of Debentures) resolutions passed at meetings of
such Debentureholders held in accordance with such provisions and instruments
signed by the Debentureholders of a specified majority of Debentures outstanding
(or specific series), which resolutions or instruments may have the effect of
amending the terms of this Initial Debenture or the Indenture.
-4-
The Indenture contains provisions disclaiming any personal liability
on the part of holders of Trust Units, the trustees, officers or agents of the
Trust or officers or directors of the Manager in respect of any obligation or
claim arising out of the Indenture or this Initial Debenture and limiting
recourse against the Trust to the property of the Trust.
This Initial Debenture may only be transferred, upon compliance with
the conditions prescribed in the Indenture, in one of the registers to be kept
at the principal office of the Trustee in Montreal, Quebec, Toronto, Ontario or
Calgary, Alberta and in such other place or places and/or by such other
registrars (if any) as the Trust with the approval of the Trustee may designate.
No transfer of this Initial Debenture shall be valid unless made on the register
by the registered Debentureholder hereof or the Debentureholder's executors or
administrators or other legal representatives, or the Debentureholder's attorney
duly appointed by an instrument in form and substance satisfactory to the
Trustee or other registrar, and upon compliance with such reasonable
requirements as the Trustee and/or other registrar may prescribe and upon
surrender of this Initial Debenture for cancellation. Thereupon a new Initial
Debenture or Initial Debentures in the same aggregate principal amount shall be
issued to the transferee in exchange hereof.
This Initial Debenture shall not become obligatory for any purpose
until it shall have been certified by the Trustee under the Indenture.
Capitalized words or expressions used in this Initial Debenture shall,
unless otherwise defined herein, have the meaning ascribed thereto in the
Indenture. TO THE EXTENT THAT THE TERMS AND CONDITIONS STATED IN THIS DEBENTURE
CONFLICT WITH THE TERMS AND CONDITIONS OF THE INDENTURE, THE LATTER SHALL
PREVAIL.
IN WITNESS WHEREOF ALGONQUIN POWER INCOME FUND has caused this
Debenture to be signed by its authorized signatory as of the ______ day of
________, 2004.
ALGONQUIN POWER INCOME FUND,
BY ITS MANAGER, ALGONQUIN POWER MANAGEMENT INC.
TRUSTEE'S CERTIFICATE
This Initial Debenture is one of the 6.65% Convertible Unsecured
Debentures due July 31, 2011 referred to in the Indenture within mentioned.
CIBC Mellon Trust Company
By:
---------------------------------
(Authorized Signing Officer)
REGISTRATION PANEL
(No writing hereon except by Trustee or other registrar)
Date of Registration In Whose Name Registered Signature of Trustee or Registrar
-------------------- ------------------------ ---------------------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _________________________, whose address and social insurance
number, if applicable, are set forth below, this Initial Debenture (or
$___________ principal amount hereof) of ALGONQUIN POWER INCOME FUND standing in
the name(s) of the undersigned in the register maintained by the Trust with
respect to such Initial Debenture and does hereby irrevocably authorize and
direct the Trustee to transfer such Initial Debenture in such register, with
full power of substitution in the premises.
Date: ____________________________________________________
Address of Transferee:_____________________________________
_____________________________________________________________
(Xxxxxx Xxxxxxx, Xxxx, Xxxxxxxx and Postal Code)
Social Insurance Number of Transferee, if applicable:
________________________________________________________________________________
If less than the full principal amount of the within Initial Debenture is to be
transferred, indicate in the space provided the principal amount which must be
$1,000 or an integral multiple thereof, unless you hold an Initial Debenture in
a non-integral multiple of $1,000, in which case such Initial Debenture is
transferable only in its entirety) to be transferred.
1. The signature(s) to this assignment must correspond with the name(s)
as written upon the face of this Initial Debenture in every particular
without alteration or any change whatsoever. The signature(s) must be
guaranteed by a Canadian chartered bank or trust company or by a
member firm of a recognized stock exchange in Canada. Notarized or
witnessed signatures are not acceptable as guaranteed signatures.
2. The registered Debentureholder of this Initial Debenture is
responsible for the payment of any documentary, stamp or other
transfer taxes that may be payable in respect of the transfer of this
Initial Debenture.
-------------------------------------------
Signature of Registered Debentureholder
-------------------------------------------
Signature of Guarantor
-------------------------------------------
Name of Institution
CONVERSION NOTICE
TO: ALGONQUIN POWER INCOME FUND
Note: All capitalized terms used herein have the meaning ascribed thereto in the
Indenture, unless otherwise indicated.
The undersigned registered Debentureholder of 6.65% Convertible Unsecured
Subordinated Debentures bearing Certificate No. ______ irrevocably elects to
convert such Debentures (or principal $ ________ amount thereof) in accordance
with the terms of the Indenture and tenders herewith the Debentures, and, if
applicable, directs that the Trust Units of Algonquin Power Income Fund issuable
upon a conversion be issued and delivered to the person indicated below.
--------------------------------------------------------------------------------
Dated: (Signature of Registered Debentureholder
If less than the full principal amount of this Debenture, indicate in the space
provided the principal amount (which must be S1,000 or integral multiples
thereof).
NOTE: If Trust Units are to be issued in the name of a person other than the
Debentureholder, (A) the signature must be guaranteed by a chartered bank, a
trust company or a member firm of a recognized stock exchange in Canada and (B)
all requisite transfer taxes must be tendered by the undersigned.
(Print name in which Trust Units are to be issued, delivered and registered)
--------------------------------------------------------------------------------
Name:
--------------------------------------------------------------------------------
(Address) (City, Province and Postal Code)
--------------------------------------------------------------------------------
Name of guarantor:
--------------------------------------------------------------------------------
Authorized signature:
SCHEDULE "B"
TO THE TRUST INDENTURE BETWEEN
ALGONQUIN POWER INCOME FUND
AND
CIBC MELLON TRUST COMPANY
FORM OF REDEMPTION NOTICE
SCHEDULE "B"
FORM OF REDEMPTION NOTICE
ALGONQUIN POWER INCOME FUND
6.65% CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES
REDEMPTION NOTICE
To: Debentureholders of 6.65% Convertible Unsecured Subordinated Debentures (the
"Debentures") of Algonquin Power Income Fund (the "Trust")
Note: All capitalized terms used herein have the meaning ascribed thereto in the
Indenture mentioned below, unless otherwise indicated.
Notice is hereby given pursuant to Section 4.3 of the Trust Indenture (the
"Indenture") dated as of July 20, 2004 between the Trust and CIBC Mellon Trust
Company (the "Trustee"), that the aggregate principal amount of all Debentures
outstanding (or the $__ aggregate principal amount thereof) will be redeemed as
of _____ (the "Redemption Date"), upon payment of a redemption amount of $___
for each $1,000 principal amount of Debentures, being equal to the aggregate of
(i) $1,000, and (ii) all accrued and unpaid interest hereon to but excluding the
Redemption Date (collectively, the "Redemption Price").
The Redemption Price will be payable upon presentation and surrender of the
Debentures called for redemption at the following corporate trust office:
CIBC Mellon Trust Company
000 Xxx Xxxxxx
Xxxxxxxx Xxxxx Xxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Manager, Corporate Trust Services
The interest upon the principal amount of Debentures called for redemption shall
cease to be payable from and after the Redemption Date, unless payment of the
Redemption Price shall not be made on presentation for surrender of such
Debentures at the above-mentioned corporate trust office on or after the
Redemption Date or prior to the setting aside of the Redemption Price pursuant
to the Indenture.
[PURSUANT TO SECTION 4.6 OF THE INDENTURE, THE TRUST HEREBY IRREVOCABLY ELECTS
TO SATISFY ITS OBLIGATION TO PAY TO DEBENTUREHOLDERS THE REDEMPTION PRICE BY
ISSUING AND DELIVERING TO THE DEBENTUREHOLDERS THAT NUMBER OF FREELY TRADEABLE
TRUST UNITS OBTAINED BY DIVIDING THE AGGREGATE PRINCIPAL AMOUNT OF DEBENTURES BY
95% OF THE CURRENT MARKET PRICE OF THE TRUST UNITS ON THE REDEMPTION DATE.
-2-
NO FRACTIONAL TRUST UNITS SHALL BE DELIVERED UPON THE EXERCISE BY THE TRUST OF
THE UNIT REDEMPTION RIGHT BUT, IN LIEU THEREOF, THE TRUST SHALL PAY THE CASH
EQUIVALENT THEREOF DETERMINED ON THE BASIS OF THE CURRENT MARKET PRICE OF TRUST
UNITS ON THE REDEMPTION DATE (LESS ANY TAX REQUIRED TO BE DEDUCTED, IF ANY).
IN THIS CONNECTION, UPON PRESENTATION AND SURRENDER OF THE DEBENTURES FOR
PAYMENT ON THE REDEMPTION DATE, THE TRUST SHALL, ON THE REDEMPTION DATE, MAKE
DELIVERY TO THE TRUSTEE, AT THE ABOVE-MENTIONED CORPORATE TRUST OFFICE, FOR
DELIVERY TO AND ON ACCOUNT OF THE DEBENTUREHOLDERS, THE NUMBER OF FREELY
TRADEABLE TRUST UNITS (IN BOOK-BASED OR CERTIFICATED FORM) TO WHICH
DEBENTUREHOLDERS ARE ENTITLED AND CASH EQUAL TO ALL ACCRUED AND UNPAID INTEREST
TO THE REDEMPTION DATE TOGETHER WITH THE CASH EQUIVALENT IN LIEU OF ALL
FRACTIONAL TRUST UNITS.]
DATED:
ALGONQUIN POWER INCOME FUND,
BY ITS MANAGER,
ALGONQUIN POWER MANAGEMENT INC.
-------------------------------------
(Authorized Trustee or Officer)
SCHEDULE "C"
TO THE TRUST INDENTURE BETWEEN
ALGONQUIN POWER INCOME FUND
AND
CIBC MELLON TRUST COMPANY
FORM OF MATURITY NOTICE
SCHEDULE "C"
FORM OF MATURITY NOTICE
ALGONQUIN POWER INCOME FUND
6.65% CONVERTIBLE UNSECURED SUBORDINATED DEBENTURES
MATURITY NOTICE
To: Debentureholders of 6.65% Convertible Unsecured Subordinated Debentures
(the "Debentures") of Algonquin Power Income Fund (the "Trust")
Note: All capitalized terms used herein have the meaning ascribed thereto in the
Indenture mentioned below, unless otherwise indicated.
Notice is hereby given pursuant to Section 4.l0(b) of the Trust Indenture (the
"Indenture") dated as of __, 2004 between the Trust and CIBC Mellon Trust
Company, as trustee (the "Trustee"), that the Debentures are due and payable as
of July 31, 2011 (the "Maturity Date") and the Trust hereby advises the
Debentureholders that it will deliver to Debentureholders that number of Freely
Tradeable Trust Units equal to the number obtained by dividing the aggregate
principal amount of such Debentures by 95% of the Current Market Price of Trust
Units on the Maturity Date. In the event that the Trust elects to issue and
deliver Trust Units as aforesaid, upon presentation and surrender of the
Debentures, the Trust shall pay or cause to be paid in cash to the
Debentureholder all accrued and unpaid interest to the Maturity Date, together
with the cash equivalent representing fractional Trust Units, and shall, on the
Maturity Date, send to the Trustee Freely Tradeable Trust Units (in book-based
or certificated form) to which the Debentureholder is entitled.
DATED:
ALGONQUIN POWER INCOME FUND,
BY ITS MANAGER,
ALGONQUIN POWER MANAGEMENT INC.
----------------------------------------
(Authorized Trustee or Officer)
SCHEDULE "D"
TO THE TRUST INDENTURE BETWEEN
ALGONQUIN POWER INCOME FUND
AND
CIBC MELLON TRUST COMPANY
FORM OF NOTICE OF CONVERSION
SCHEDULE "D"
FORM OF NOTICE OF CONVERSION
CONVERSION NOTICE
To: ALGONQUIN POWER INCOME FUND
Note: All capitalized terms used herein have the meaning ascribed thereto in the
Trust Indenture mentioned below, unless otherwise indicated.
The undersigned registered Debentureholder of 6.65% Convertible Unsecured
Subordinated Debentures bearing Certificate No. __ irrevocably elects to convert
such Debentures (or $__ principal amount thereof*) in accordance with the terms
of the Trust Indenture dated as of __, 2004 between the Trust and CIBC Mellon
Trust Company and tenders herewith the Debentures, and, if applicable, directs
that the Trust Units issuable upon a conversion be issued and delivered to the
person indicated below.
Dated:
------------------------ ----------------------------------------
(Signature of Registered
Debentureholder)
* If less than the full principal amount of the Debentures, indicate in the
space provided the principal amount which must be $1,000 or integral
multiples thereof.
NOTE: If Trust Units are to be issued in the name of a Person other than the
Debentureholder, (A) the signature must be guaranteed by a chartered bank,
a trust company or a member firm of a recognized stock exchange in Canada
and (B) ail requisite transfer taxes must be tendered by the undersigned.
(Print name in which Trust Units are to be issued, delivered and registered)
------------------------------- ----------------------------------------
(Address) (City, Province and Postal Code)
Name of guarantor:
Authorized signature:
SCHEDULE "E"
TO THE TRUST INDENTURE BETWEEN
ALGONQUIN POWER INCOME FUND
AND
CIBC MELLON TRUST COMPANY
FORM OF DECLARATION FOR REMOVAL OF LEGEND
SCHEDULE "E"
FORM OF DECLARATION FOR REMOVAL OF LEGEND
FORM OF DECLARATION FOR REMOVAL OF LEGEND
To: CIBC Mellon Trust Company
as transfer agent for the Trust Units and the Convertible
Unsecured Subordinated Debentures of
Algonquin Power Income Fund
The undersigned (a) acknowledges that the sale of the securities of Algonquin
Power Income Fund (the "Trust") to which this declaration relates is being made
in reliance on Rule 904 of Regulation S under the United States Securities Act
of 1933, as amended (the "1933 Act") and (b) certifies that (1) the seller is
not an affiliate (as defined in Rule 405 under the 0000 Xxx) of the Trust, (2)
the offer of such securities was not made to a Person in the United States or
identifiable group of U.S. citizens abroad and either (A) at the time the buy
order was originated, the buyer was outside the United States, or the seller and
any Person acting on its behalf reasonably believe that the buyer was outside
the United States, or (B) the transaction was executed on or through the
facilities of The Toronto Stock Exchange or any other designated offshore
securities market as defined in Regulation S under the 1933 Act and neither the
seller nor any Person acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States, (3) neither the seller nor any
affiliate of the seller nor any Person acting on any of their behalf has engaged
or will engage in any directed selling efforts in connection with the offer and
sale of such securities, (4) the sale is bona fide and not for the purpose of
"washing off" the resale restrictions imposed because the securities are
"restricted securities" (as such term is defined in Rule 144(a)(3) under the
1933 Act), (5) the seller does not intend to replace the securities sold in
reliance on Rule 904 of the 1933 Act with fungible unrestricted securities, and
(6) the contemplated sale is not a transaction, or part of a series of
transactions which, although in technical compliance with Regulation S, is part
of a plan or scheme to evade the registration provisions of the 1933 Act. Terms
used herein have the meanings given to them by Regulation S under the 1933 Act.
Dated: By:
------------------------ ------------------------------------
Name:
Title:
SCHEDULE "F"
TO THE TRUST INDENTURE BETWEEN
ALGONQUIN POWER INCOME FUND
AND
CIBC MELLON TRUST COMPANY
FORM OF PUT EXERCISE NOTICE
SCHEDULE "F"
FORM OF NOTICE OF PUT EXERCISE
PUT EXERCISE NOTICE
To: ALGONQUIN POWER INCOME FUND
Note: All capitalized terms used herein have the meaning ascribed thereto in the
Trust Indenture mentioned below, unless otherwise indicated.
The undersigned registered Debentureholder of 6.65% Convertible Unsecured
Subordinated Debentures bearing Certificate No. ___ irrevocably elects to put
such Debentures (or $__ principal amount thereof*) to Algonquin Power Income
Fund ("Trust") to be purchased by the Trust on ___ (the "Put Date") in
accordance with the terms of the Trust Indenture dated as of __, 2004 between
the Trust and CIBC Mellon Trust Company at a price of $1,010 for each $1,000
principal amount of Debentures plus all accrued and unpaid interest hereon to,
but excluding, the Put Date (collectively, the "Total Put Price") and tenders
herewith the Debentures.
Dated:
------------------------ ----------------------------------------
(Signature of Registered
Debentureholder)
* If less than the full principal amount of the Debentures, indicate in the
space provided the principal amount which must be $1,000 or integral
multiples thereof.
The Total Put Price will be payable upon presentation and surrender of the
Debentures with this form on or after the Put Date at the following corporate
trust office:
CIBC Mellon Trust Company
000 Xxx Xxxxxx
Xxxxxxxx Xxxxx Xxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Manager, Corporate Trust Services
The interest upon the principal amount of Debentures put to the Trust shall
cease to be payable from and after the Put Date unless payment of the Total Put
Price shall not be made on presentation for surrender of such Debentures at the
above mentioned corporate trust office on or after the Put Date or prior to the
setting aside of the Total Put Price pursuant to the Trust Indenture.
