Kinross Gold Corporation
Exhibit
99.1
Kinross
Gold Corporation
1.75%
Convertible Notes due 2028
January
23, 2008
Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
UBS
Securities LLC
As
the
Representative of the several Purchasers
c/o
Merrill Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
0
Xxxxx
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Kinross
Gold Corporation, a corporation existing under the laws of the Province of
Ontario (the “Company”), proposes, subject to the terms and conditions stated
herein, to issue and sell to Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (“Xxxxxxx Xxxxx”), UBS Securities LLC (“UBS”, and together with
Xxxxxxx Xxxxx, the “Representatives”) and each of the other Purchasers named in
Schedule A hereto (collectively, the “Purchasers”) an aggregate of $420,000,000
principal amount of its 1.75% Senior Convertible Notes due 2028, convertible
into common shares (the “Common Shares”), of the Company (the “Firm Notes”) and,
at the option of the Purchasers, up to an aggregate of $40,000,000 principal
amount of additional 1.75% Senior Convertible Notes due 2028 (the “Optional
Notes”, and the Firm Notes and the Optional Notes that the Purchasers elect to
purchase pursuant to Section 2 hereof being collectively called the
“Securities”).
1. The
Company represents and warrants to, and agrees with, as of the date hereof,
each
of the Purchasers that:
(a) A
preliminary offering memorandum, dated January 23, 2008 (the “Preliminary
Offering Memorandum”) and an offering memorandum (including, with respect to
sales in Canada, a “wrapper” containing information specific to a private
offering of securities in Canada), dated January 23, 2008 (the “Offering
Memorandum”), have been prepared in connection with the offering of the
Securities. The Preliminary Offering Memorandum, as amended and
supplemented immediately prior to the Applicable Time (as defined in Section
1(b) hereof), is hereinafter referred to as the “Pricing
Memorandum”. Any reference to the Preliminary Offering Memorandum,
the Pricing Memorandum or the Offering Memorandum shall be deemed to refer
to
and include the Company’s most recent Annual Report on Form 40-F and the
documents listed on Schedule B(i) hereto, each as filed or furnished with
the Securities and Exchange Commission (the “Commission”) pursuant to
Section 13(a), 13(c) or 15(d) of the United States Securities
Exchange Act of 1934, as amended (the “Exchange Act”) on or prior to the date of
the Preliminary Offering Memorandum or the Offering Memorandum, as the case
may
be, and any reference to the Preliminary Offering Memorandum or the Offering
Memorandum, as the case may be, as amended or supplemented, as of any specified
date, shall be deemed to include (i) any documents filed (but not any documents
furnished and not filed) with the Commission pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of the Preliminary
Offering Memorandum or the Offering Memorandum, as the case may be, and prior
to
such specified date and (ii) any Additional Issuer
Information (as defined in Section 5(d) hereof) furnished by the Company
prior to the completion of the distribution of the Securities; and all documents
filed under the Exchange Act and so deemed to be included in the Preliminary
Offering Memorandum or the Offering Memorandum, as the case may be, or any
amendment or supplement thereto are hereinafter called the “Exchange Act
Reports”. Each of the Preliminary Offering Memorandum, the Offering
Memorandum and any amendments or supplements thereto and the Exchange Act
Reports did not and will not, as of their respective dates, contain an untrue
statement of a material fact or omit to state a material fact necessary in
order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; and any further documents so filed and
incorporated by reference in the Offering Memorandum or any further amendment
or
supplement thereto, when such documents become effective or are filed with
the
Commission, as the case may be, will conform in all material respects to
the
requirements of the United States Securities Act of 1933, as amended (the
“Act”)
or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided, however,
that this
representation and warranty shall not apply to any statements or omissions
made
in reliance upon and in conformity with information furnished in writing
to the
Company by a Purchaser through the Representatives expressly for use
therein;
(b)
For
the
purposes of this Agreement, the “Applicable Time” is 7 a.m. (Eastern time) on
January 24, 2008; the Pricing Memorandum as supplemented by the information
set
forth in Schedule B(ii) hereto, taken together (collectively, the “Pricing
Disclosure Package”) as of the Applicable Time, did not include any untrue
statement of a material fact or omit to state any material fact necessary
in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; and each Company Supplemental Disclosure
Document (as defined in Section 6(a) hereof) listed on Schedule B(iii)
hereto does not conflict with the information contained in the Pricing
Memorandum or the Offering Memorandum and each such Company Supplemental
Disclosure Document, as supplemented by and taken together with the Pricing
Disclosure Package as of the Applicable Time, did not include any untrue
statement of a material fact or omit to state any material fact necessary
in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however,
that this
representation and warranty shall not apply to statements or omissions made
in a
Company Supplemental Disclosure Document in reliance upon and in conformity
with
information furnished in writing to the Company by a Purchaser through the
Representatives expressly for use therein;
(c)
Neither
the Company nor any of its subsidiaries has sustained since the date of the
latest audited financial statements included or incorporated by reference
in the
Pricing Disclosure Package any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order
or
decree, otherwise than as set forth or contemplated in the Pricing Disclosure
Package, except for losses or interferences that would not, individually
or in
the aggregate, have a material adverse effect on the general affairs,
management, financial position, shareholders’ equity or results of operations of
the Company and its subsidiaries considered as one enterprise (a “Material
Adverse Effect”); and, since the respective dates as of which information is
given in the Pricing Disclosure Package, there has not been any change in
the
share capital (other than pursuant to any employee benefit plan of the Company)
or increase in long-term debt of the Company or any of its subsidiaries or
any
other change that would have a Material Adverse Effect or any development
involving a prospective change that, to the best of the Company’s knowledge,
would reasonably be expected to have a Material Adverse Effect, otherwise
than
as set forth or contemplated in the Pricing Disclosure Package;
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(d) The
Company has been duly amalgamated and is validly existing as a corporation
in
good standing under the laws of the Province of Ontario, with power and
authority (corporate and other) to own, lease and operate its properties
and
conduct its business as described in the Pricing Disclosure Package and the
Offering Memorandum, and is duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any business
so
as to require such qualification, except where the failure to be so qualified
would not have a Material Adverse Effect;
(e) The
Company has an authorized capitalization as set forth in the Pricing Disclosure
Package and the Offering Memorandum and all of the issued shares in the capital
of the Company have been duly and validly authorized and issued and are fully
paid and non-assessable; the Common Shares initially issuable upon conversion
of
the Securities have been duly authorized and, when issued and delivered in
accordance with the provisions of the Securities and the Indenture referred
to
below, will be validly issued, fully paid and non-assessable and will conform
to
the description of the Common Shares contained in the Pricing Disclosure
Package
and the Offering Memorandum; and the issuance of the Common Shares upon
conversion will not be subject to the preemptive or other similar rights
of any
security holder of the Company;
(f)
Each
of
the “significant subsidiaries” of the Company (as defined in Rule 1-02 of
Regulation S-X under the Act) (each a “Significant Subsidiary” and, together,
the “Significant Subsidiaries”) has been duly organized and is validly existing
as a corporation in good standing under the laws of the jurisdiction of its
incorporation (to the extent that such a concept exists under the local law
of
such jurisdiction), with power and authority (corporate and other) to own,
lease
and operate its properties and to conduct its business as described in the
Pricing Disclosure Package and the Offering Memorandum, is duly qualified
as a
foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the
ownership or leasing of property or the conduct of business and, except as
otherwise disclosed in the Pricing Disclosure Package and the Offering
Memorandum, all of the issued and outstanding capital stock of each Significant
Subsidiary has been duly authorized and validly issued, is fully paid and
non-assessable except, in each case above in this paragraph (f), as would
not
result in a Material Adverse Effect;
(g) The
Company has the corporate power and authority to execute and deliver the
Agreement, the Securities, the Indenture and the Registration Rights Agreement
referred to below, and to perform its obligations hereunder and
thereunder;
(h) This
Agreement has been duly authorized, executed and delivered by the
Company;
(i)
The
registration rights agreement to be dated as of January 29, 2008 between
the
Company and the Purchasers (the “Registration Rights Agreement”) has been duly
authorized and, when the Securities are offered and paid for pursuant to
this
Agreement, will have been duly executed and delivered by the Company and
will
constitute a valid and legally binding obligation of the Company, enforceable
in
accordance with its terms, except as the enforceability thereof may be subject
to the effect of any bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium and other laws of general applicability relating to
or
affecting creditors’ rights and to general principles of equity and public
policy (regardless of whether enforcement is sought in a proceeding at law
or in
equity) and to the discretion of the court before which any proceeding may
be
brought;
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(j)
The
Securities have been duly authorized and, when executed, issued and delivered
pursuant to this Agreement will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding obligations of
the
Company entitled to the benefits provided by the indenture to be dated as
of
January 29, 2008 (the “Indenture”) between the Company and Xxxxx Fargo Bank,
National Association, as trustee (the “Trustee”), under which the Securities are
to be issued; the Indenture has been duly authorized by the Company and,
when
executed and delivered by the Company and the Trustee, will constitute at
the
Time of Delivery a valid and legally binding instrument, enforceable against
the
Company in accordance with its terms, except as the enforceability thereof
may
be subject to the effect of any bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium and other laws of general applicability
relating to or affecting creditors’ rights and to general principles of equity
and public policy (regardless of whether enforcement is sought in a proceeding
at law or in equity) and to the discretion of the court before which any
proceeding may be brought; the Securities, the Registration Rights Agreement
and
the Indenture will conform, in all material respects, to the descriptions
thereof in the Pricing Disclosure Package and the Offering
Memorandum;
(k) The
issue
and sale of the Securities and the compliance by the Company with all of
the
provisions of the Securities, the Indenture, the Registration Rights Agreement
and this Agreement and the consummation of the transactions herein and therein
contemplated (i) will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company pursuant to, any indenture, mortgage, deed
of
trust, loan agreement or other agreement or instrument to which the Company
or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, nor will such action result in any
violation of any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of its subsidiaries or
any
of their properties, except for any such conflict, breach, violation or default
which (A) would not, individually or in the aggregate, have a Material
Adverse Effect, (B) would not impair the Company’s ability to perform its
obligations hereunder or under the Securities or the Indenture and
(C) would not have any material adverse effect upon the consummation of the
transactions contemplated hereby and thereby, and (ii) will not result in
any violation of the provisions of the Articles of Amalgamation or by-laws
of
the Company; and no consent, approval, filing, authorization, order,
registration or qualification of or with any such court or governmental agency
or body in the United States or Canada is required for the issue and sale
of the
Securities or the consummation by the Company of the transactions contemplated
by this Agreement, the Registration Rights Agreement or the Indenture except
(1) such as have been, or will be at the time of such issue and sale or the
time of consummation of such transactions, obtained under the Act and the
Trust
Indenture Act; (2) such consents, approvals, filings, authorizations,
registrations or qualifications as may be required under state securities
or
Blue Sky laws in connection with the purchase and distribution of the Securities
by the Purchasers; (3) the conditional approval of the Toronto Stock
Exchange of the listing of the Common Shares issuable upon conversion of
the
Securities; and (4) the delivery and filing of the Offering Memorandum and
applicable reports of exempt distribution in Form 45-106F1 with the securities
regulatory authorities in Canada;
4
(l)
Other
than as set forth in the Pricing Disclosure Package and the Offering Memorandum,
there are no legal or governmental proceedings pending to which the Company
or
any of its subsidiaries is a party or of which any property of the Company
or
any of its subsidiaries is the subject, which, if determined adversely to
the
Company or any of its subsidiaries, would, individually or in the aggregate,
have a Material Adverse Effect or which would materially and adversely affect
the consummation of the transactions contemplated in this Agreement, the
Indenture and the Registration Rights Agreement or the performance by the
Company of its obligations hereunder and thereunder; and, to the best of
the
Company’s knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(m) Neither
the Company nor any of its subsidiaries is in violation of its Articles of
Incorporation, Articles of Amalgamation, by-laws, or analogous charter
documents, or in violation of or in default in the performance or observance
of
any obligation, covenant or condition contained in any indenture, mortgage,
deed
of trust, loan agreement, lease or other agreement or instrument to which
it is
a party or by which it or any of its properties may be bound, except for
any
such violation or default which would not, individually or in the aggregate,
have a Material Adverse Effect;
(n) The
Company is a “reporting issuer” (or equivalent) in each province of Canada and
is not in default of any requirement under applicable Canadian securities
laws
except for any default which would not, individually or in the aggregate,
have a
Material Adverse Effect; there is no order, ruling or direction of any
securities regulatory authority in Canada which would deny the benefit of
an
exemption otherwise provided for under applicable Canadian securities laws
with
respect to the distribution of the Securities and which is being relied upon
by
the Purchasers in connection with offers and sales of the Securities in Canada,
and no proceedings which would reasonably be expected to result in any such
order or ruling have been instituted or are pending or, to the knowledge
of the
Company, threatened; and no order, ruling or determination having the effect
of
suspending the sale or ceasing the trading of any securities of the Company
has
been issued or made by any securities regulatory authority in Canada or the
Toronto Stock Exchange and is continuing in effect and no proceedings for that
purpose have been instituted or are pending or, to the Company's knowledge,
contemplated or threatened by any such authority;
(o) The
financial statements (including the notes thereto) incorporated by reference
into the Pricing Disclosure Package and the Offering Memorandum present fairly
the financial position of the Company and its consolidated subsidiaries at
the
dates indicated and the statement of operations, shareholders’ equity and cash
flows of the Company and its consolidated subsidiaries for the periods
specified; said financial statements have been prepared in conformity with
generally accepted accounting principles in Canada (“Canadian GAAP”) applied on
a consistent basis throughout the periods involved, unless otherwise noted,
and
the audited consolidated financial statements have been reconciled to generally
accepted accounting principles in the United States. The selected
summary consolidated financial information included in the Pricing Disclosure
Package and the Offering Memorandum has been compiled on a basis consistent
with
the financial statements included in the Pricing Disclosure Package and the
Offering Memorandum. The pro forma financial statements of the
Company and its subsidiaries and the related notes thereto incorporated by
reference in the Pricing Disclosure Package and the Offering Memorandum present
fairly the information shown therein and the assumptions used in the preparation
thereof are reasonable and the adjustments used therein are appropriate to
give
effect to the transactions and circumstances referred to therein;
(p) The
Company and its subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, “Governmental Licenses”) issued by the
appropriate federal, state, provincial, local or foreign regulatory agencies
or
bodies necessary to conduct the business now operated by them, except where
the
failure so to possess would not, singly or in the aggregate, result in a
Material Adverse Effect; the Company and its subsidiaries are in compliance
with
the terms and conditions of all such Governmental Licenses, except where
the
failure so to comply would not, singly or in the aggregate, result in a Material
Adverse Effect; all of the Governmental Licenses are valid and in full force
and
effect, except where the invalidity of such Governmental Licenses or the
failure
of such Governmental Licenses to be in full force and effect would not, singly
or in the aggregate, result in a Material Adverse Effect; and neither the
Company nor any of its subsidiaries has received any notice of proceedings
relating to the revocation or modification of any such Governmental Licenses
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse Effect;
5
(q) Except
as
described in the Pricing Disclosure Package and the Offering Memorandum and
except such matters as would not result in a Material Adverse Effect,
(A) neither the Company nor any of its subsidiaries is in violation of any
federal, state, provincial, local or foreign statute, law, rule, regulation,
ordinance, legal code, or any legally binding judicial or administrative
interpretation thereof, including any judicial or administrative order, consent,
decree or judgment, relating to pollution or protection of the environment
(including, without limitation, ambient air, surface water, groundwater,
land
surface or subsurface strata) or wildlife, including, without limitation,
laws
and regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products, asbestos-containing materials or mold
(collectively, “Hazardous Materials”) or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, “Environmental Laws”), (B) the Company and
its subsidiaries have all permits, authorizations and approvals required
under
any applicable Environmental Laws for the business as presently conducted
and
are each in substantial compliance with their requirements, (C) to the Company’s
knowledge, there are no pending or threatened administrative, regulatory
or
judicial actions, suits, claims, liens, actions concerning any noncompliance
or
violation, investigations or adversarial legal proceedings pursuant to any
Environmental Law against the Company or any of its subsidiaries and (D)
there
are no orders for clean-up or remediation, or actions, suits or proceedings
by
any private party or governmental body or agency, against or affecting the
Company or any of its subsidiaries alleging releases of Hazardous Materials
or
any violation of Environmental Laws, except, in each case, as would not be
expected to result in a Material Adverse Effect;
(r) The
Company or its subsidiary, as applicable, has good and valid title to all
real
property owned or leased by the Company and each of its subsidiaries, free
and
clear of all mortgages, liens, security interests, claims, restrictions or
encumbrances of any kind except (a) as described in the Pricing Disclosure
Package and the Offering Memorandum or (b) where any defect in or absence
of
such title would not, singly or in the aggregate, result in a Material Adverse
Effect.
(s) The
statements set forth in the Pricing Disclosure Package under the captions
“Description of Notes,” and “Description of Kinross Capital Structure”, insofar
as they purport to constitute a summary of the terms of the Securities and
the
Common Shares, under the caption “Certain U.S. Federal Income Tax
Consequences,” and
under the caption “Plan of Distribution” insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate, complete
and fair in all material respects;
(t)
Subject
to, and taking into account, the qualifications, limitations, assumptions
and
considerations set forth therein, the statements set forth in the Offering
Memorandum under the caption “Certain Canadian Federal Income Tax
Considerations” accurately summarize the principal Canadian federal income tax
considerations as of the date of the Offering Memorandum generally applicable
to
a holder of Securities who acquires Securities pursuant to the Offering
Memorandum as described therein;
6
(u) The
Company is not and, after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof, will not be an
“investment company”, as such term is defined in the Investment Company Act of
1940, as amended (the “Investment Company Act”);
(v) When
the
Securities are issued and delivered pursuant to this Agreement, the Securities
will not be of the same class (within the meaning of Rule 144A under the
Act) as
securities which are listed on a national securities exchange registered
under
Section 6 of the Exchange Act or quoted in a United States automated
inter-dealer quotation system;
(w) The
Company is subject to Section 13 or 15(d) of the Exchange Act;
(x)
Neither
the Company, its “affiliates” (as defined in Rule 405 under the Act) nor any
person acting on its or their behalf has offered or sold, or will offer or
sell,
the Securities by means of any general solicitation or general advertising
within the meaning of Rule 502(c) under the Act;
(y) Within
the preceding six months, none of the Company, its affiliates or any other
person acting on its or their behalf has solicited any offer to buy, offered
or
sold to any person any Securities, or any securities of the same or a similar
class as the Securities, other than Securities offered or sold to the Purchasers
hereunder. The Company will take reasonable precautions designed to
insure that any offer or sale, direct or indirect, in the United States of
any
Securities or any substantially similar security issued by the Company, within
six months subsequent to the date on which the distribution of the Securities
has been completed (as notified to the Company by the Representatives), is
made
under restrictions and other circumstances reasonably designed not to affect
the
status of the offer and sale of the Securities in the United States contemplated
by this Agreement as transactions exempt from the registration provisions
of the
Act;
(z) (i)
KPMG
LLP, who have certified certain financial statements of the Company and their
subsidiaries and have audited the Company’s management’s assessment of the
Company’s internal control over financial reporting are independent public
accountants and (ii) Deloitte & Touche LLP, who have certified certain
financial statements of the Company and their subsidiaries were at the time
of
such certification independent public accountants, in each case as required
by
the Act and the rules and regulations of the Commission thereunder;
(aa)
The
Company maintains a system of internal control over financial reporting (as
such
term is defined in Rule 13a-15(f) under the Exchange Act) that complies with
the
requirements of the Exchange Act and has been designed by the Company’s
principal executive officer and principal financial officer, or under their
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles in
Canada. Management of the Company assessed internal control over
financial reporting of the Company as of December 31, 2006 and concluded
internal control over financial reporting was effective as of such
date. The Company is not aware of any material weaknesses in its
internal control over financial reporting;
(bb)
Except
as
disclosed in the Pricing Disclosure Package and the Offering Memorandum,
since
the date of the latest audited financial statements included or incorporated
by
reference in the Pricing Disclosure Package, there has been no change in
the
Company’s internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Company’s internal
control over financial reporting;
7
(cc)
The
Company maintains disclosure controls and procedures (as such term is defined
in
Rule 13a-15(e) under the Exchange Act) that comply with the requirements
of the
Exchange Act; such disclosure controls and procedures have been designed
to
ensure that information required to be disclosed by the Company in the reports
that it files or submits under the Exchange Act is accumulated and communicated
to the Company’s management and such disclosure controls and procedures were
effective as of December 31, 2006;
(dd)
Neither
the Company nor any of its affiliates has taken, nor will the Company or
any
affiliate take, directly or indirectly, any action which is designed to or
which
has constituted, or which might reasonably be expected to cause or result
in,
the stabilization or manipulation of the price of any security of the Company
in
connection with the offering of the Securities;
(ee)
With
respect to information set forth or incorporated by reference in the Pricing
Disclosure Package and the Offering Memorandum: (i) information relating
to the
Company's estimates of mineral reserves and mineral resources as at the date
they were prepared has been reviewed and verified by the Company or independent
consultants to the Company as being consistent with the Company's mineral
reserve and mineral resource estimates as at the date they were prepared;
(ii)
the mineral reserve and mineral resource estimates have been prepared in
accordance with National Instrument 43-101 - "Standards of Disclosure
for Mineral
Projects" by or under the supervision of a qualified person as defined
therein; and (iii) the methods used in estimating the Company's mineral reserves
and mineral resources are in accordance with accepted mineral reserve and
mineral resource estimation practices;
(ff)
Neither
the Company nor, to the knowledge of the Company, any director, officer,
agent,
employee, affiliate or other person acting on behalf of the Company or any
of
its subsidiaries is aware of or has taken any action, directly or indirectly,
that violates in any material respect the Foreign Corrupt Practices Act of
1977,
as amended, and the rules and regulations thereunder; and
(gg)
Neither
the Company nor, to the knowledge of the Company, any director, officer,
agent,
employee, affiliate or person acting on behalf of the Company is currently
subject to any United States sanctions administered by the Office of Foreign
Assets Control of the United States Treasury Department (“OFAC”); and the
Company will not knowingly directly or indirectly use the proceeds of the
offering, or knowingly lend, contribute or otherwise make available such
proceeds to any subsidiary, joint venture partner or other person or entity,
for
the purpose of financing the activities of any person currently subject to
any
United States sanctions administered by OFAC.
2.
Subject
to the terms and conditions herein set forth, (a) the Company agrees to
issue and sell to each of the Purchasers, and each of the Purchasers agrees,
severally and not jointly, to purchase from the Company, at a purchase price
of
100% of the principal amount thereof, plus accrued interest, if any, from
January 29, 2008 to the Time of Delivery hereunder, the principal amount of
Firm Notes set forth opposite the name of such Purchaser in Schedule A hereto;
and as compensation for the
Purchasers’ services (which, in the case of a Purchaser who is a non-resident of
Canada for purposes of the Income Tax Act (Canada) (a “Non-Resident Purchaser”)
shall be for services rendered exclusively outside of Canada and, in the
case of
a Purchaser who is not a Non-Resident Purchaser shall be for services) in
connection with the sale of the Firm Notes, the Company agrees to pay each
Purchaser simultaneously with the payment of the purchase price for the Firm
Notes by such Purchaser to the Company, a commission equal to $22.00 per
$1,000
aggregate principal amount of the Firm Notes purchased by such Purchaser;
(b) in the event and to the extent that the Purchasers shall exercise
the
election to purchase Optional Notes as provided below, the Company agrees
to
issue and sell to each of the Purchasers, and each of the Purchasers agrees,
severally and not jointly, to purchase from the Company, at the same purchase
price set forth in clause (a) of this Section 2, that portion of the aggregate
principal amount of Optional Notes as to which such election shall have been
exercised (to be adjusted by the Purchasers so as to eliminate fractions
of
$1,000) determined by multiplying such aggregate principal amount of Optional
Notes by a fraction, the numerator of which is the maximum aggregate principal
amount of Optional Notes which such Purchaser is entitled to purchase as
set
forth opposite the name of such Purchaser in Schedule A hereto and the
denominator of which is the maximum aggregate principal amount of Optional
Notes
that all of the Purchasers are entitled to purchase hereunder; and as compensation for the Purchasers’
services described above in
connection with the sale of any Optional Notes
purchased hereunder, the Company agrees to pay each Purchaser simultaneously
with the payment of the purchase price for the Optional Notes by such Purchaser
to the Company, a commission equal to $22.00 per $1,000 aggregate principal
amount of the Optional Notes purchased by such Purchaser; and (c) the
Company expressly authorizes each Purchaser to deduct the commission to which
it
is entitled pursuant to this Section 2 hereof from the payment made by it
of the purchase price for the Firm Notes or any Optional Notes in satisfaction
of the Company’s obligation to pay such commission.
8
The
Company hereby grants to the Purchasers the right to purchase at their election
up to $40,000,000 aggregate principal amount of Optional Notes, at the purchase
price set forth in clause (a) of the paragraph above. Any such
election to purchase Optional Notes may be exercised by written notice from
the
Representatives to the Company, given within a period of 30 calendar days
after
the date of this Agreement, setting forth the aggregate principal amount
of
Optional Notes to be purchased and the date on which such Optional Notes
are to
be delivered, as determined by the Representatives, but in no event earlier
than
the First Time of Delivery (as defined below) or, unless the Representatives
and
the Company otherwise agree in writing, earlier than two or later than ten
business days after the date of such notice.
3.
Upon
the
authorization by the Representatives of the release of the Securities, the
several Purchasers propose to offer the Securities for sale upon the terms
and
conditions set forth in this Agreement and the Offering Memorandum, and each
Purchaser hereby represents and warrants to, and agrees with the Company
that:
(a) It
will
offer and sell the Securities only to persons who it reasonably believes
are
“qualified institutional buyers” (“QIBs”) within the meaning of Rule 144A under
the Act in transactions meeting the requirements of Rule 144A;
(b) It
is an
“accredited investor” within the meaning of Rule 501 under the Act;
(c) It
will
not offer or sell the Securities by any form of general solicitation or general
advertising, including but not limited to the methods described in Rule 502(c)
under the Act; and
(d) It
will
offer and sell the Securities in Canada, and to residents of Canada, only
to
persons who are accredited investors within the meaning of National Instrument
45-106 – Prospectus and
Registration Exemptions, in transactions which are exempt from the
prospectus requirements of applicable Canadian securities laws.
9
4.
(a) The
Securities to be purchased by each Purchaser hereunder will be represented
by
one or more definitive global Securities in book-entry form which will be
deposited by or on behalf of the Company with The Depository Trust Company
(“DTC”) or its designated custodian. The Company will deliver the
Securities to Xxxxxxx Xxxxx, for the account of each Purchaser, against payment
by or on behalf of such Purchaser of the purchase price therefor by wire
transfer to an account designated by the Company in Federal (same day) funds,
by
causing DTC to credit the Securities to the account of Xxxxxxx Xxxxx at
DTC. The Company will cause the certificates representing the global
Securities to be made available to Xxxxxxx Xxxxx for checking at least
twenty-four hours prior to the Time of Delivery (as defined below) at the
office
of DTC or its designated custodian (the “Designated Office”). The time and date
of
such delivery and payment shall be, with respect to the Firm Notes, 9:30
a.m.,
New York City time, on January 29, 2008 or such other time and date as the
Representatives and the Company may agree upon in writing, and, with respect
to
the Optional Notes, 9:30 a.m., New York time, on the date specified by the
Representatives in the written notice given by Representatives of the
Purchasers’ election to purchase such Optional Notes, or such other time and
date as Representatives and the Company may agree upon in
writing. Such time and date for delivery of the Firm Notes is herein
called the “First Time of Delivery”, any time and date for delivery of Optional
Notes, if not the First Time of Delivery, is herein called an “Optional Time of
Delivery”, and each such time and date for delivery of Securities is herein
called a “Time of Delivery”.
(b) The
documents to be delivered at each Time of Delivery by or on behalf of the
parties hereto pursuant to Section 8 hereof will be delivered at such time
and date at the offices of Shearman & Xxxxxxxx XXX, Xxxxxxx, Xxxxxxx (the
“Closing Location”), and the Securities will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the
Closing Location at 1:00 p.m., New York City time, on the New York Business
Day next preceding such Time of Delivery, at which meeting the final drafts
of
the documents to be delivered pursuant to the preceding sentence will be
available for review by the parties hereto. For the purposes of this
Section 4, “New York Business Day” shall mean each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order
to
close.
5.
The
Company agrees with each of the Purchasers:
(a) To
prepare the Offering Memorandum in a form approved by the Representatives;
to
make no amendment or any supplement to the Offering Memorandum which shall
be
disapproved by the Representatives promptly after reasonable notice thereof;
and
to furnish the Purchasers with copies thereof;
(b) Promptly
from time to time to take such action as you may reasonably request to qualify
the Securities and the Common Shares issuable upon conversion of the Securities
for offering and sale under the securities laws of such jurisdictions as
you may
request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be necessary
to
complete the distribution of the Securities, provided that in connection
therewith the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any
jurisdiction;
(c) To
furnish the Purchasers with copies of the Offering Memorandum and each amendment
or supplement thereto with the independent accountants’ report(s) in or
incorporated by reference in the Offering Memorandum, and any amendment or
supplement containing amendments to the financial statements covered by such
report(s), signed by the accountants, and additional written and electronic copies
thereof in such quantities as the Purchasers may from time to time reasonably
request, and if, at any time prior to the expiration of nine months after
the
date of the Offering Memorandum, any event shall have occurred as a result
of
which the Offering Memorandum as then amended or supplemented would include
an
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances
under
which they were made when such Offering Memorandum is delivered, not misleading,
or, if for any other reason, in the reasonable opinion of any of the Company,
its counsel, the Representatives or counsel for the Representatives, it shall
be
necessary or desirable during such same period to amend or supplement the
Offering Memorandum, to promptly notify the Representatives and upon their
request to prepare and furnish without charge to each Purchaser and to any
dealer in securities as many written and electronic copies
as
the Purchasers may from time to time reasonably request of an amended Offering
Memorandum or a supplement to the Offering Memorandum which will be in form
and
substance satisfactory in the reasonable opinion of counsel for the Purchasers
and will correct such statement or omission or effect such
compliance;
10
(d) During
the period beginning on the date hereof until 60 days following the date
of the
Offering Memorandum, not to offer, sell, contract to sell or otherwise dispose
of, any securities of the Company that are substantially similar to the
Securities, including but not limited to any securities that are convertible
into or exchangeable for, or that represent the right to receive, Common
Shares
or any such substantially similar securities, other than (i) pursuant to
employee stock option plans, deferred compensation plans or similar plans
existing on the date of this Agreement, (ii) upon the conversion or
exchange of the Securities or convertible or exchangeable securities outstanding
as of, the date of this Agreement, or (iii) in connection with an
acquisition of a business or entity, a consolidation, merger, combination
or
plan of arrangement, or a transaction or series of transactions entered into
in
response to an unsolicited bid by a third party to engage in any of the
foregoing transactions, provided that, except in the circumstance of an
unsolicited bid, any securities issued pursuant to the exception in this
clause
(iii) may not be sold or otherwise conveyed until 60 days following the date
of
the Offering Memorandum, in each case without the prior written consent of
the
Representatives, except as provided hereunder;
(e) At
any
time when the Company is not subject to Section 13 or 15(d) of the Exchange
Act, for the benefit of holders from time to time of Securities, to furnish
at
its expense, upon request, to holders of Securities and prospective purchasers
of securities information (the “Additional Issuer Information”) satisfying the
requirements of subsection (d)(4)(i) of Rule 144A under the Act;
(f) To
use
its best efforts to cause the Securities to be eligible for the PORTAL trading
system of the National Association of Securities Dealers, Inc.;
(g) During
the one-year period from and after the Time of Delivery, the Company will
not,
and will not permit any of its affiliates to, resell any of the Securities which constitute
“restricted securities” under Rule 144 that have been reacquired by any of
them;
(h) To
keep
available at all times, free of preemptive rights, Common Shares for the
purpose
of enabling the Company to satisfy any obligations to issue Common Shares
upon
conversion of the Securities;
(i)
To
use
its best efforts to list, subject to notice of issuance, the Common Shares
issuable upon conversion of the Securities on the New York Stock Exchange
and to
have caused the Common Shares issuable upon conversion of the Securities
to be
conditionally approved for listing and, subject to the satisfaction of notice
of
issuance and other customary post-closing conditions imposed by the Toronto
Stock Exchange, be posted for trading on the Toronto Stock
Exchange;
11
(j)
To
file,
within the time periods prescribed by the applicable Canadian securities
laws,
such documents and reports as may be required to be filed by the Company
with
the securities regulatory authorities in Canada under the applicable Canadian
securities laws relating to the private placement of Securities by the
Purchasers, and the Company will pay any filing fee prescribed with respect
thereto; and
(k) To
immediately notify the Representatives, and confirm such notice in writing,
of
any filing made by the Company of information relating to the offering of
the
Securities with any securities exchange or any other regulatory body in the
United States, Canada or any other jurisdiction for the period from the date
hereof until resale of the notes has been completed by the Purchasers (as
notified in writing by the Representatives), but in no case later than six
months from the date of the Offering Memorandum.
6.
(a) Each
Purchaser represents and agrees that, without the prior consent of the Company
and the Representatives, other than one or more term sheets relating to the
Securities containing customary information which, in their final form, will
not
be inconsistent with the information set forth on Schedule B(ii) hereto, it
has not made and will not make any offer relating to the Securities that,
if the
offering of the Securities contemplated by this Agreement were conducted
as a
public offering pursuant to a registration statement filed under the Act
with
the Commission, would constitute a “free writing prospectus,” as defined in Rule
405 under the Act (any such offer (other than any such term sheets) is
hereinafter referred to as a “Company Supplemental Disclosure Document”);
and
(b) Each
Company Supplemental Disclosure Document, the use of which has been consented
to
by the Company and the Representatives, is listed on Schedule B(iii)
hereto.
7.
The
Company covenants and agrees with the several Purchasers that the Company
will
pay or cause to be paid the following: (1) the fees, disbursements and expenses
of the Company’s counsel and accountants in connection with the issue of the
Securities, and the Common Shares issuable upon conversion of the Securities,
and all other expenses in connection with the preparation and printing of
the
Pricing Disclosure Package and the Offering Memorandum and any amendments
and
supplements thereto or of any Company Supplemental Disclosure Documents and
the
mailing and delivering of copies thereof to the Purchasers and dealers; (2)
the
cost of printing or producing this Agreement, the Indenture, any Blue Sky
memorandum, the Registration Rights Agreement, closing documents (including
any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Securities; (3) all expenses in connection
with the qualification of the Securities and the Common Shares issuable upon
conversion of the Securities for offering and sale under state securities
laws
as provided in Section 5(b) hereof, including the fees and disbursements of
counsel for the Purchasers in connection with such qualification and in
connection with the Blue Sky and legal investment surveys; (4) the cost of
preparing the Securities; (5) the fees and expenses of the Trustee and any
agent
of the Trustee and the fees and disbursements of counsel for the Trustee
in
connection with the Indenture and the Securities; (6) any cost incurred in
connection with the designation of the Securities for trading in PORTAL and
the
listing of the Common Shares issuable upon conversion of the Securities;
and (7)
all other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this
Section. It is understood, however, that, except as provided in this
Section, and Sections 9, 10 and 13 hereof, the Purchasers will pay all of
their own costs and expenses, including the fees of their counsel, transfer
taxes on resale of any of the Securities by them, and any advertising expenses
connected with any offers they may make.
12
8.
The
obligations of the Purchasers hereunder as to the Securities to be delivered
at
each Time of Delivery shall be subject, in their discretion, to the condition
that all representations and warranties and other statements of the Company
herein are true and correct as of the date of this Agreement and true and
correct as though expressly made at and as of such Time of Delivery, the
condition that the Company shall have performed in all material respects
all of
its obligations hereunder theretofore to be performed, and the following
additional conditions (and if any condition specified in this Section shall
not
have been fulfilled when and as required to be fulfilled, this Agreement
may be
terminated by the Representatives by notice to the Company at any time at
or
prior to the Time of Delivery, and such termination shall be without liability
of any party to any other party except as provided in Section 7 and except
that Sections 1, 9, 10, 12 and 13 shall survive any such termination and
remain in full force and effect):
(a) Shearman
& Sterling LLP, United States counsel for the Purchasers, shall have
furnished to the Purchasers such written opinion or opinions, dated such
Time of
Delivery, with respect to the Indenture, the validity of the Securities,
the
Pricing Disclosure Package and the Offering Memorandum and such other related
matters as the Purchasers may reasonably request, and such counsel shall
have
received such papers and information as they may reasonably request to enable
them to pass upon such matters;
(b) Xxxxxxxx
& Xxxxxxxx LLP, United States counsel for the Company, shall have furnished
to the Purchasers their written opinion and disclosure letter, dated such
Time
of Delivery, substantially in the form of Annex I(a) hereto and reasonably
acceptable to the Purchasers;
(c) Osler,
Xxxxxx & Harcourt LLP, Canadian counsel for the Company, shall have
furnished to the Purchasers their written opinion, dated such Time of Delivery,
substantially in the form of Annex I(b) hereto and reasonably acceptable
to the
Purchasers;
(d) On
the
date of the execution of this Agreement and also at each Time of Delivery,
each
of KPMG LLP, Deloitte & Touche LLP and PricewaterhouseCoopers LLP shall have
furnished to the Purchasers a letter or letters, dated the respective dates
of
delivery thereof, each in form and substance agreed by the Purchasers prior
to
execution of this Agreement;
(e) (i) Neither
the
Company nor any of its subsidiaries shall have sustained since the date of the
latest audited financial statements included or incorporated by reference
in the
Pricing Disclosure Package any loss or interference with its business from
fire,
explosion, flood or other calamity, whether or not covered by insurance,
or from
any labor dispute or court or governmental action, order or decree, that
would,
individually or in the aggregate, have a Material Adverse Effect, otherwise
than
as set forth or contemplated in the Pricing Disclosure Package, and (ii)
since
the respective dates as of which information is given in the Pricing Disclosure
Package there shall not have been any change in the share capital (other
than
pursuant to any employee benefit plan of the Company) or increase in long-term
debt of the Company or any of its subsidiaries or any other change that would
have a Material Adverse Effect, or any development involving a prospective
change that would have a Material Adverse Effect, otherwise than as set forth
or
contemplated in the Pricing Disclosure Package, the effect of which, in any
such
case described in clause (i) or (ii), is in the judgment of the Representatives
so material and adverse as to make it impracticable or inadvisable to proceed
with the offering, sale or delivery of the Securities being delivered at
such
Time of Delivery on the terms and in the manner contemplated in this Agreement
and in the Offering Memorandum;
13
(f) On
or
after the Applicable Time there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally
on
the New York Stock Exchange or the Toronto Stock Exchange; (ii) a suspension
or
material limitation in trading in the Company’s securities on the New York Stock
Exchange or the Toronto Stock Exchange; (iii) a general moratorium on commercial
banking activities declared by U.S. or Canadian federal, New York State or
Ontario provincial authorities or a material disruption in commercial banking
or
securities settlement or clearance services in the United States or Canada;
(iv)
the outbreak or escalation of hostilities involving the United States or
Canada
or the declaration by the United States or Canada of a national emergency
or
war; or (v) the occurrence of any other calamity or crisis or any change or
development involving a prospective change in financial, political or economic
conditions in the United States, Canada or elsewhere; if the effect of any
such
event specified in clause (iv) or (v) in the judgment of the Representatives
makes it impracticable or inadvisable to proceed with the offering, sale
or
delivery of the Securities being delivered at such Time of Delivery on the
terms
and in the manner contemplated herein and in the Offering
Memorandum;
(g) The
Securities shall have been designated for trading on The PORTAL
Market;
(h) The
Company shall have furnished or caused to be furnished to the Representatives
at
the Time of Delivery a certificate or certificates of officers of the Company
satisfactory to the Representatives as to the accuracy of the representations
and warranties of the Company herein at and as of the date hereof and such
Time
of Delivery, as to the performance by the Company of all of its obligations
hereunder to be performed or satisfied at or prior to such Time of Delivery,
as
to the matters set forth in subsection (e) of this Section and as to such
other
matters as the Representatives may reasonably request; and
(i) The
Representatives shall have received executed lock-up agreements substantially
in
the form attached as Annex I(c) hereto from the persons listed in
Schedule C hereto.
9.
(a) The
Company
will indemnify and hold harmless each Purchaser, its affiliates, as detailed
in
Rule 405 under the Act, its selling agents and each person, if any, who controls
each Purchaser within the meaning of Section 15 of the Act or
Section 20 of Exchange Act as follows:
(i)
against
any and all loss, liability, claim, damage and expense whatsoever, as incurred,
arising out of or based upon any untrue statement or alleged untrue statement
of
a material fact contained in any Preliminary Offering Memorandum, the Pricing
Disclosure Package, the Offering Memorandum (or any amendment or supplement
thereto) or any Company Supplemental Disclosure Materials, or the omission
or
alleged omission therefrom of a material fact necessary in order to make
the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(ii) against
any and all loss, liability, claim, damage and expense whatsoever, as incurred,
to the extent of the aggregate amount paid in settlement of any litigation,
or
any investigation or proceeding by any governmental agency or body, commenced
or
threatened, or of any claim whatsoever arising out of or based upon any such
untrue statement or omission, or any such alleged untrue statement or omission;
provided (subject to Section 9(d) below) that any such settlement is made
with
the written consent of the Company; and
(iii) against
any and all expense whatsoever, as incurred (including the reasonable fees
and
disbursements of counsel chosen by the Representatives), reasonably incurred
in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced
or
threatened, or any claim whatsoever based upon any such untrue statement
or
omission, or any such alleged untrue statement or omission, to the extent
that
any such expense is not paid under (i) or (ii) above;
14
provided,
however,
that the indemnity
agreement in this Section 9(a) shall not apply to any loss, liability, claim,
damage or expense to the extent arising out of any untrue statement or omission
or alleged untrue statement or omission made in reliance upon and in conformity
with written information furnished to the Company by any Purchaser through
the
Representatives expressly for use in any Preliminary Offering Memorandum,
the
Pricing Disclosure Package, the Offering Memorandum (or any amendment or
supplement thereto) or in any Company Supplemental Disclosure Document.
(b) Each
Purchaser severally agrees to indemnify and hold harmless the Company and
each
person, if any, who controls the Company within the meaning of Section 15
of the Act or Section 20 of the Exchange Act against any and all loss,
liability, claim, damage and expense described in the indemnity contained
in
subsection (a) of this Section, as incurred, but only with respect to
untrue statements or omissions, or alleged untrue statements or omissions,
made
in any Preliminary Offering Memorandum, the Pricing Disclosure Package, the
Offering Memorandum or any Company Supplemental Disclosure Document in reliance
upon and in conformity with written information furnished to the Company
by the
Purchasers through the Representatives expressly for use therein.
(c) Each
indemnified party shall give notice as promptly as reasonably practicable
to
each indemnifying party of any action commenced against it in respect of
which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder
to
the extent it is not materially prejudiced as a result thereof and in any
event
shall not relieve it from any liability which it may have otherwise than
on
account of this indemnity. In the case of parties indemnified pursuant to
Section 9(a) above, counsel to the indemnified parties shall be selected
by the
Representatives, and, in the case of parties indemnified pursuant to Section
9(b) above, counsel to the indemnified parties shall be selected by the Company.
An indemnifying party may participate at its own expense in the defense of
any
such action; provided,
however,
that counsel
to the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar
or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent
to
the entry of any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened,
or
any claim whatsoever in respect of which indemnification or contribution
could
be sought under this Section 9 or Section 10 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as
to or an admission of fault, culpability or a failure to act by or on behalf
of
any indemnified party.
15
(d) If
at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 9(a)(ii) effected without its written
consent if (i) such settlement is entered into more than 90 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement
at
least 60 days prior to such settlement being entered into, (iii) a
follow-up notice regarding the proposed settlement shall have been received
by
the indemnifying party no more than 45 days and no fewer than 30 days
before such settlement is entered into and (iv) such indemnifying party
shall not have reimbursed such indemnified party in accordance with such
request
prior to the date of such settlement.
10. If
the
indemnification provided for in Section 9 hereof is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred to therein,
then, except to the extent that the indemnifying party is materially prejudiced
as a result of any failure by the indemnified party to notify the indemnifying
party of any action as contemplated by Section 9(c), each indemnifying party
shall contribute to the aggregate amount of such losses, liabilities, claims,
damages and expenses incurred by such indemnified party, as incurred,
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Purchasers on the other hand
from the offering of the Securities pursuant to this Agreement or (ii) if
the allocation provided by clause (i) is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company
on the one hand and of the Purchasers on the other hand in connection with
the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable
considerations.
The
relative benefits received by the Company on the one hand and the Purchasers
on
the other hand in connection with the offering of the Securities pursuant
to
this Agreement shall be deemed to be in the same respective proportions as
the
total net proceeds from the offering of the Securities pursuant to this
Agreement (before deducting expenses) received by the Company and the total
underwriting discounts received by the Purchasers, bear to the aggregate
initial
offering price of the Securities.
The
relative fault of the Company on the one hand and the Purchasers on the other
hand shall be determined by reference to, among other things, whether any
such
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Company
or by the Purchasers and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.
The
Company and the Purchasers agree that it would not be just and equitable
if
contribution pursuant to this Section 10 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 10. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 10 shall be deemed
to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or
any
investigation or proceeding by any governmental agency or body, commenced
or
threatened, or any claim whatsoever based upon any such untrue or alleged
untrue
statement or omission or alleged omission.
Notwithstanding
the provisions of this Section 10, no Purchaser shall be required to contribute
any amount in excess of the amount by which the total price at which the
Securities purchased and sold by it hereunder exceeds the amount of any damages
which such Purchaser has otherwise been required to pay by reason of such
untrue
or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
16
For
purposes of this Section, each person, if any, who controls a Purchaser within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act
shall have the same rights to contribution as such Purchaser, and each person,
if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Company. The Purchasers’ respective obligations to
contribute pursuant to this Section 10 are several in proportion to the
principal amount of the Securities set forth opposite their respective names
in
Schedule A hereto and not joint.
11. (a) If
any
Purchaser shall default in its obligation to purchase the Securities which
it
has agreed to purchase hereunder at a Time of Delivery, the Representatives
may
in their discretion arrange for the Purchasers or another party or other
parties
to purchase such Securities on the terms contained herein. If, within thirty-six
hours after such default by any Purchaser, the Representatives do not arrange
for the purchase of such Securities, then the Company shall be entitled to
a
further period of thirty-six hours within which to procure another party
or
other parties satisfactory to the Representatives to purchase such Securities
on
such terms. In the event that, within the respective prescribed periods,
the
Representatives notify the Company that it has so arranged for the purchase
of
such Securities, or the Company notifies the Representatives that it has
so
arranged for the purchase of such Securities, the Representatives or the
Company
shall have the right to postpone such Time of Delivery for a period of not
more
than seven days, in order to effect whatever changes may thereby be made
necessary in the Offering Memorandum, or in any other documents or arrangements,
and the Company agrees to prepare promptly any amendments to the Offering
Memorandum which in the opinion of the Representatives may thereby be made
necessary. The term “Purchaser” as used in this Agreement shall include any
person substituted under this Section with like effect as if such person
had
originally been a party to this Agreement with respect to such
Securities
(b) If,
after
giving effect to any arrangements for the purchase of the Securities of a
defaulting Purchaser or Purchasers by the Representatives and the Company
as
provided in subsection (a) above, the aggregate principal amount of such
Securities which remains unpurchased does not exceed one eleventh of the
aggregate principal amount of all the Securities to be purchased at such
Time of
Delivery, then the Company shall have the right to require each non-defaulting
Purchaser to purchase the principal amount of Securities which such Purchaser
agreed to purchase hereunder to be purchased at such Time of Delivery and,
in
addition, to require each non-defaulting Purchaser to purchase its pro rata
share (based on the principal amount of Securities which such Purchaser agreed
to purchase hereunder) of the Securities of such defaulting Purchaser or
Purchasers for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Purchaser from liability for its
default.
(c) If,
after
giving effect to any arrangements for the purchase of the Securities of a
defaulting Purchaser or Purchasers by the Representatives and the Company
as
provided in subsection (a) above, the aggregate principal amount of Securities
which remains unpurchased exceeds one-eleventh of the aggregate principal
amount
of all the Securities to be purchased at such Time of Delivery, or if the
Company shall not exercise the right described in subsection (b) above to
require non defaulting Purchasers to purchase Securities of a defaulting
Purchaser or Purchasers, then this Agreement or with respect to an Optional
Time
of Delivery, the obligations of the Purchasers to purchase and of the Company
to
sell the Optional Notes shall thereupon terminate, without liability on the
part
of any non defaulting Purchaser or the Company, except for the expenses to
be
borne by the Company and the Purchasers as provided in Section 7 hereof and
the
indemnity and contribution provisions in Sections 9 and 10 hereof; but nothing
herein shall relieve a defaulting Purchaser from liability for its
default.
17
12. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and the several Purchasers, as set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on
behalf
of any Purchaser or any controlling person of any Purchaser, or the Company,
or
any officer or director or controlling person of the Company, and shall survive
delivery of and payment for the Securities.
13. If
this
Agreement shall be terminated pursuant to Section 11 hereof, the Company
shall
not then be under any liability to any Purchaser except as provided in Sections
7, 9 and 10 hereof; but, if for any other reason, any Securities are not
delivered by or on behalf of the Company as provided herein, the Company
will
reimburse the Purchasers through the Representatives for all out-of-pocket
expenses approved in writing by the Representatives, including fees and
disbursements of counsel, reasonably incurred by the Purchasers in making
preparations for the purchase, sale and delivery of the Securities not so
delivered, but the Company shall not then be under any further liability
to any
Purchaser except as provided in Sections 7, 9 and 10 hereof.
14. In
all
dealings hereunder, the Representatives shall act on behalf of each of the
Purchasers, and the parties hereto shall be entitled to act and rely upon
any
statement, request, notice or agreement on behalf of any Purchaser made or
given
by either or both of the Representatives.
15. All
statements, requests, notices and agreements hereunder shall be in writing,
and
if to the Purchasers shall be delivered or sent by mail, telex or facsimile
transmission to Xxxxxxx Xxxxx at 0 Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx
00000 or (000) 000 0000, attention: Global Origination Counsel and UBS at
000
Xxx Xxxxxx, XXX Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx X0X 0X0 and if to the
Company shall be delivered or sent by mail, telex or facsimile transmission
to
the address of the Company set forth in the Offering Memorandum, Attention:
Chief Financial Officer.
16. This
Agreement shall be binding upon, and inure solely to the benefit of, the
Purchasers, the Company and, to the extent provided in Sections 9 and 10
hereof,
the officers and directors of the Company and each person who controls the
Company or any Purchaser, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the
Securities from any Purchaser shall be deemed a successor or assign by reason
merely of such purchase.
17. Time
shall be of the essence of this Agreement. As used herein, the term
“business day” shall mean any day when the Commission’s office in Washington,
D.C. is open for business.
18. The
Company acknowledges and agrees that (i) the purchase and sale of the Securities
pursuant to this Agreement, including the determination of the offering price
of
the Securities and any related discounts and commissions, is an arm’s-length
commercial transaction between the Company, on the one hand, and the several
Purchasers, on the other, (ii) in connection therewith and with the process
leading to such transaction each Purchaser is and has been acting solely
as a
principal and not the agent or fiduciary of the Company or its shareholders,
creditors, employees or any other party, (iii) no Purchaser has assumed or
will
assume an advisory or fiduciary responsibility in favor of the Company with
respect to the offering contemplated hereby or the process leading to the
offering of the Securities (irrespective of whether such Purchaser has advised
or is currently advising the Company on other matters) and no Purchaser has
any
obligation to the Company except the obligations expressly set forth in this
Agreement, (iv) the Purchasers and their respective affiliates may be engaged
in
a broad range of transactions that involve interests that differ from those
of
the Company, (v) the Purchasers have not provided any legal, accounting,
regulatory or tax advice with respect to the offering contemplated hereby
and
(vi) the Company has consulted its own legal and financial advisors to the
extent it deemed appropriate. The Company agrees that it will not
claim that the Purchasers, or any of them, has rendered advisory services
of any
nature or respect, or owes a fiduciary or similar duty to the Company, in
connection with such transaction or the process leading to the offering of
the
Securities.
18
19. The
Company hereby agrees that
the Representativesmay
provide copies of the Preliminary
Offering
Memorandum and the Offering Memorandum relating to this offering and any
other
agreements or document relating thereto, including without limitation any
registration rights agreement or trust indentures, to Xtract Research LLC
(“Xtract”) following the completion of the offering for inclusion in an online
research service sponsored by Xtract, access to which is restricted to
“qualified institutional buyers” as defined in Rule 144A under the
Act.
20. This
Agreement supersedes all prior agreements and understandings (whether written
or
oral) between the Company and the Purchasers, or any of them, with respect
to
the offering of the Securities.
21. This
Agreement shall be governed by and construed in accordance with the laws
of the
State of New York.
22. The
Company and each of the Purchasers hereby irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in
any
legal proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
23. This
Agreement may be executed by any one or more of the parties hereto in any
number
of counterparts, each of which shall be deemed to be an original, but all
such
counterparts shall together constitute one and the same instrument.
24. Notwithstanding
anything herein to the contrary, the Company is authorized to disclose to
any
persons the United States federal and state tax treatment and tax structure
of
the potential transaction and all materials of any kind (including tax opinions
and other tax analyses) provided to the Company relating to that treatment
and
structure, without the Purchasers imposing any limitation of any kind. However,
any information relating to the tax treatment and tax structure shall remain
confidential (and the foregoing sentence shall not apply) to the extent
necessary to enable any person to comply with securities laws. For this purpose,
“tax structure” is limited to any facts that may be relevant to that
treatment.
25. The
Company hereby submits to the non-exclusive jurisdiction of the federal and
state courts in the Borough of Manhattan in The City of New York in any suit
or
proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby. The Company irrevocably and unconditionally
waives any objection to the laying of venue of any suit or proceeding arising
out of or relating to this Agreement or the transactions contemplated hereby
in
federal courts in the Borough of Manhattan in The City of New York and
irrevocably and unconditionally waives and agrees not to plead or claim in
any
such court that any such suit or proceeding in any such court has been brought
in an inconvenient forum. The Company appoints CT Corporation System,
000 Xxxxxx Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, XX 00000, or such other agent as the Company in its discretion
may
appoint, as its authorized agent in the Borough of Manhattan in the City
of New
York upon which process may be served in any such suit or proceeding, and
agrees
that service of process upon such agent, and written notice of said service
to
the Company, by the person serving the same to the address provided in Section
15, shall be deemed in every respect effective service of process upon the
Company in any suit or proceeding. The Company further agrees to take
any and all action as may be necessary to maintain an agent for service of
process in New York in full force and effect for a period of three years
from
the date of this Agreement. Notice of any change in the Company’s
appointed agent for service of process in New York shall be given to the
Representatives in accordance with Section 15 herein.
19
If
the
foregoing is in accordance with the Purchasers’ understanding, please sign and
return to us six counterparts hereof, and upon the acceptance hereof by the
Representatives, on behalf of each of the Purchasers, this letter and such
acceptance hereof shall constitute a binding agreement between each of the
Purchasers and the Company. It is understood that the
Representatives’ acceptance of this letter on behalf of each of the Purchasers
is pursuant to the authority set forth in a form of Master Agreement Among
Underwriters, the form of which shall be submitted to the Company for
examination upon request.
|
Very
truly yours,
|
|||
| Kinross Gold Corporation | |||
|
|
By:
|
/s/ Xxxxxx Xxxxxxxx | |
| Name: Xxxxxx Xxxxxxxx | |||
| Title: Executive Vice President andChief Financial Officer | |||
|
|
By:
|
/s/ Xxxxxxxxxxx Xxxx | |
| Name: Xxxxxxxxxxx Xxxx | |||
| Title: Senior Vice President and Treasurer | |||
|
Accepted
as of the date hereof:
|
||
| Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated | ||
|
By:
|
/s/
Xxxx
Xxxxxxx
|
|
|
Name:
Xxxx Xxxxxxx
|
||
|
Title:
Managing Director
|
||
|
UBS
Securities LLC
|
||
|
By:
|
/s/
Xxxx
Xxxxxxxxxx
|
|
|
Name:
Xxxx Xxxxxxxxxx
|
||
|
Title:
Director
|
||
|
By:
|
/s/
Xxxxx
Xxxxx
|
|
|
Name:
Xxxxx Xxxxx
|
||
|
Title:
Director
|
||
20
