EXHIBIT 3.12
XXX.XXX INTERNATIONAL INC.
- and -
1184041 ONTARIO INC.
====================
- and -
XXXXXX GROUP COMPANY
====================
- and -
CIBC MELLON TRUST COMPANY
SPECIAL WARRANT INDENTURE
Providing for the Issue of up to
8,600,000 Special Warrants
of Xxx.Xxx International Inc.
August 4, 1998
TABLE OF CONTENTS
Article 1 - Interpretation............................................................ 2.
1.1 Definitions.................................................................... 2.
1.2 Number and Gender.............................................................. 6.
1.3 Interpretation Not Affected by Headings, etc................................... 6.
1.4 Business Day................................................................... 6.
1.5 Time of the Essence............................................................ 6.
1.6 Applicable Law................................................................. 6.
1.7 Choice of Language............................................................. 7.
1.8 Currency....................................................................... 7.
Article 2 - Issue of Special Warrants................................................. 7.
2.1 Issue of Primary Special Warrants and Secondary Special Warrants............... 7.
2.2 Form and Terms of Special Warrants............................................. 7.
2.3 Signing of Special Warrant Certificates........................................ 8.
2.4 Deposit of Shares Underlying Secondary Special Warrants........................ 8.
2.5 Certification by the Special Warrant Agent..................................... 9.
2.6 Special Warrantholder Not a Shareholder........................................ 9.
2.7 Issue in Substitution for Lost Special Warrant Certificates.................... 9.
2.8 Special Warrants to Rank Pari Passu............................................ 10.
2.9 Registers for Special Warrants................................................. 10.
2.10 Transferee Entitled to Registration............................................ 11.
2.11 Registers Open for Inspection.................................................. 11.
2.12 Exchange of Special Warrants................................................... 11.
2.13 Ownership and Transfer of Special Warrants..................................... 12.
2.14 Adjustment of Subscription Rights.............................................. 12.
2.15 Adjustment Rules............................................................... 13.
2.16 Notice of Adjustment of Subscription Rights.................................... 14.
Article 3 - Exercise of Special Warrants.............................................. 15.
3.1 Exercise of Special Warrants and Deemed Exercise of Special Warrants........... 15.
3.2 Effect of Exercise of Special Warrants......................................... 17.
3.3 Postponement of Delivery of Certificates....................................... 17.
3.4 Cancellation of Special Warrant Certificates................................... 17.
Article 4 - Covenants................................................................. 19.
4.1 General Covenants.............................................................. 19.
4.2 Securities Qualification Requirements.......................................... 20.
4.3 Special Warrant Agents's Remuneration and Expenses............................. 21.
4.4 Performance of Covenants by Special Warrant Agent.............................. 21.
i
Article 5 - Enforcement............................................................... 22.
5.1 Suits by Special Warrantholders................................................ 22.
5.2 Immunity of Shareholders, etc.................................................. 22.
5.3 Limitation of Liability........................................................ 22.
Article 6 - Meetings of Special Warrantholders........................................ 22.
6.1 Right to Convene Meetings...................................................... 22.
6.2 Notice......................................................................... 23.
6.3 Chairman....................................................................... 23.
6.4 Quorum......................................................................... 23.
6.5 Power to Adjourn............................................................... 24.
6.6 Show of Hands.................................................................. 24.
6.7 Poll and Voting................................................................ 24.
6.8 Regulations.................................................................... 24.
6.9 Issuers, Special Warrant Agent and Underwriter may be Represented.............. 25.
6.10 Powers Exercisable by Extraordinary Resolution................................. 25.
6.11 Meaning of Extraordinary Resolution............................................ 26.
6.12 Powers Cumulative.............................................................. 27.
6.13 Minutes........................................................................ 27.
6.14 Instruments in Writing......................................................... 27.
6.15 Binding Effect of Resolutions.................................................. 28.
6.16 Holdings by the Corporation or Subsidiaries of the Corporation Disregarded..... 28.
Article 7 - Supplemental Indentures................................................... 28.
7.2 Successor Corporations......................................................... 29.
Article 8 - Concerning the Special Warrant Agent...................................... 30.
8.1 Trust Indenture Legislation.................................................... 30.
8.2 Rights and Duties of Special Warrant Agent..................................... 30.
8.3 Evidence, Experts and Advisers................................................. 32.
8.4 Documents, Monies, etc. Held by Special Warrant Agent.......................... 33.
8.5 Action by Special Warrant Agent to Protect Interests........................... 33.
8.6 Special Warrant Agent Not Required to Give Security............................ 33.
8.7 Protection of Special Warrant Agent............................................ 33.
8.8 Replacement of Special Warrant Agent........................................... 34.
8.9 Conflict of Interest........................................................... 35.
8.10 Acceptance of Trusts........................................................... 35.
ii
8.11 Special Warrant Agent Not to be Appointed Receiver.............................. 35.
8.12 Authorization to Carry on Business................................................. 36.
8.13 Liability of Special Warrant Agent.............................................. 36.
Article 9 - Form of Special Warrant.................................................. 36.
9.1 Form of Special Warrant Certificate............................................. 36.
Article 10 - General.................................................................. 47.
10.1 Notice to the Issuers and the Special Warrant Agent............................. 47.
10.2 Notice to the Special Warrantholders............................................ 48.
10.3 Mail Service Interruption....................................................... 49.
10.4 Counterparts and Formal Date.................................................... 49.
10.5 Satisfaction and Discharge of Indenture......................................... 49.
10.6 Provisions of Indenture and Special Warrants for the Sole Benefit of Parties
and Special Warrantholders...................................................... 49.
iii
THIS SPECIAL WARRANT INDENTURE made as of the 4th day of August,
1998.
B E T W E E N:
XXX.XXX INTERNATIONAL INC. (FORMERLY INTERNET LIQUIDATORS
INTERNATIONAL INC.), a corporation constituted under the laws of
the Province of Ontario, Canada
(hereinafter called the "CORPORATION")
[_] and [_]
1184041 ONTARIO INC.
(hereinafter called "0000000")
[_] and [_]
XXXXXX GROUP COMPANY
(hereinafter called "XXXXXX" )
[_] and [_]
CIBC MELLON TRUST COMPANY, a trust company incorporated under the
laws of Canada
(hereinafter called the " SPECIAL WARRANT AGENT")
WHEREAS:
A. The Corporation proposes to issue and sell by means of a private placement
8,100,000 special warrants (the "PRIMARY SPECIAL WARRANTS"), and 1184041 and
Xxxxxx propose to issue and sell by means of a private placement up to 500,000
special warrants (the "SECONDARY SPECIAL WARRANTS"). Subject to adjustment in
certain events, each Primary and Secondary Special Warrant entitles the holder
thereof to receive one (1) unit ("Unit"). Each Unit consists of one common
share ("Common Share") and one-half ( 1/2) a Common Share purchase warrant
("Share Purchase Warrant"), in the capital of the Corporation, all upon the
terms and conditions herein set forth;
B. For such purpose the Corporation, 1184041 and Xxxxxx, xxxx it necessary to
create and issue the Primary and Secondary Special Warrants as provided for in
this Indenture;
2.
C. The Issuers (as hereinafter defined) are duly authorized to create and
issue the Primary and Secondary Special Warrants to be created and issued, as
herein provided;
D. 1184041 and Xxxxxx (collectively the "Sellers") have deposited with the
Special Warrant Agent a sufficient number of common shares of the Corporation
together with all necessary transfer documentation to discharge their respective
obligations pursuant to the Secondary Special Warrants and this Indenture.
E. All things necessary have been done and performed to make the Primary and
Secondary Special Warrants, when certified by the Special Warrant Agent and
issued as in this Indenture provided, legal, valid and binding upon the
Corporation with the benefits of, and subject to the terms of, this Indenture;
F. The foregoing recitals are made as representations and statements of fact
by the Sellers and not by the Special Warrant Agent.
NOW THEREFORE for good and valuable consideration mutually given and
received, the receipt and sufficiency of which is hereby acknowledged, it is
hereby agreed and declared as follows:
ARTICLE 1 - INTERPRETATION
1.1 DEFINITIONS
In this Indenture, unless there is something in the subject matter or
context inconsistent therewith, the following phrases and words have the
respective meanings indicated opposite them as follows:
(a) "APPLICABLE LEGISLATION" has the meaning ascribed thereto in
subsection 8.1(a);
(b) "BUSINESS DAY" means a day which is not a Saturday or Sunday or
statutory holiday in any of the cities where special warrant
certificates may be submitted to the Special Warrant Agent pursuant to
subsection 3.1 hereof;
(c) "CAPITAL REORGANIZATION" has the meaning ascribed thereto in section
2.14;
(d) "COMMON SHARES" means fully paid and non-assessable common shares in
the capital of the Corporation as currently constituted;
(e) "CORPORATION" means Xxx.Xxx International Inc., a corporation
constituted under the laws of the Province of Ontario, Canada;
3.
(f) "CORPORATION'S AUDITORS" means Deloitte & Touche or such other
chartered accountant or firm of chartered accountants duly appointed
as auditor or auditors of the Corporation from time to time and
acceptable to the Special Warrant Agent;
(g) "COUNSEL" means Corporation's counsel or such other firm of barristers
and solicitors retained by the Special Warrant Agent from time to time
and acceptable to the Special Warrant Agent;
(h) "CORPORATION'S COUNSEL" means Gowling, Strathy & Xxxxxxxxx or such
other barrister or solicitor or firm of barristers and solicitors
retained by the Corporation from time to time and acceptable to the
Special Warrant Agent;
(i) "DIRECTOR" means a director of the Corporation for the time being and,
unless otherwise specified herein, reference to "ACTION BY THE
DIRECTORS" means action by the directors of the Corporation as a board
or, whenever duly empowered, action by a committee of such board;
(j) "ESCROW AGENT" means Xxxxxxxxx Xxxx Xxxxxxx Apps & Dellelce,
Barristers and Solicitors, Toronto;
(k) "ESCROWED PROCEEDS" means the amount of $8,217,600 representing 75% of
the gross proceeds of the sale of the Primary and Secondary Special
Warrants less an amount equal to 75% of the Underwriter's commission
and estimated costs and expenses incurred in connection with such
sale, which shall be deposited into escrow with the Escrow Agent;
(l) "EXERCISE DATE" means the day upon which a Special Warrant is
exercised pursuant to the provisions of Section 3.1 or deemed to be
exercised pursuant to Section 3.1(b);
(m) "EXPIRY TIME" means 5:00 p.m. (Toronto time) on the earlier of: (i)
the fifth Business Day after the Qualification Date; and (ii) August
4, 1999;
(n) "EXTRAORDINARY RESOLUTION" has the meaning ascribed thereto in Section
6.11 and 6.14;
(o) "FINAL PROSPECTUS" means the (final) prospectus of the Corporation
relating to the distribution of the Subject Securities in the
Qualifying Jurisdictions;
(p) "ISSUERS" means the Corporation, 1184041 and Xxxxxx;
4.
(q) "PERSON" includes an individual, a corporation, a partnership, any
unincorporated organization or any other juridical entity and words
importing persons have a similar meaning;
(r) "PRELIMINARY PROSPECTUS" means the preliminary prospectus of the
Corporation relating to the distribution of the Subject Securities in
the Qualifying Jurisdictions;
(s) "PRIMARY SPECIAL WARRANTS" means the 8,100,000 Special Warrants being
created hereunder and issued and sold by the Corporation pursuant to
the Underwriting Agreement;
(t) "QUALIFICATION DATE" means the date of issuance of a receipt or
similar document by the last of the Securities Administrators to issue
a receipt or similar document for the Final Prospectus;
(u) "QUALIFICATION DEADLINE" means the date which is 90 days after the
date of issuance of the Primary and Secondary Special Warrants;
(v) "QUALIFICATION DEFAULT" means the failure on the part of the
Corporation to obtain a receipt for the Final Prospectus from the
Securities Administrators in each of the Qualifying Jurisdictions, on
or before 5:00 p.m. (Toronto time) on the Qualification Deadline;
(w) "QUALIFYING JURISDICTIONS" means the Province of Ontario and any such
additional provinces in which purchasers of the Special Warrants are
resident;
(x) "SECONDARY SPECIAL WARRANTS" means the 500,000 Special Warrants being
created hereunder and sold by the Sellers pursuant to the Underwriting
Agreement;
(y) "SECURITIES ADMINISTRATORS" means collectively the securities
commission or comparable authority in each of the Qualifying
Jurisdictions;
(z) "SHARE PURCHASE WARRANTS " means the warrants issuable upon the
exercise or deemed exercise of the Special Warrants subject to the
terms and conditions of the Share Purchase Warrant Indenture which
indenture shall govern the entitlement of a holder to acquire one (1)
additional Common Share at $1.65 at any time prior to the earlier of
(i) ten (10) business days following the date on which the Corporation
delivers a notice to all holders of Share Purchase Warrants confirming
that it has filed a preliminary prospectus or registration statement
in connection with a U.S. public offering of at least $7,000,000 and
(ii) 5:00 p.m. (Toronto time) on August 4, 1999;
(aa) "SHARE PURCHASE WARRANT INDENTURE " means the indenture dated as of
even date herewith among the Corporation, 1184041, Xxxxxx and CIBC
Mellon Trust Company as Agent pursuant to which the Share Purchase
Warrants will be issued;
5.
(bb) "SHAREHOLDER" means a holder of record of one or more Common Shares;
(cc) "SPECIAL WARRANT AGENT" means CIBC Mellon Trust Company and its lawful
successors for the time being in the trusts hereby created;
(dd) "SPECIAL WARRANTHOLDER" OR "HOLDER" means a person whose name is
entered for the time being in the register maintained by the Special
Warrant Agent pursuant to subsection 2.8(a);
(ee) "SPECIAL WARRANTHOLDERS' REQUEST" means an instrument signed in one or
more counterparts by Special Warrantholders holding in the aggregate
not less than 25% of the then outstanding Special Warrants which
requests the Special Warrant Agent to take some action or proceeding
specified therein;
(ff) "SPECIAL WARRANTS" mean the special warrants of the Corporation
created hereby, including the Primary Special Warrants and the
Secondary Special Warrants each entitling the registered holder
thereof to receive one Unit, consisting of (1) Common Share and one-
half ( 1/2) of one Share Purchase Warrant for each special warrant on
the exercise of such special warrant or such other kind and amount of
shares or other securities or property calculated or otherwise
determined pursuant to Sections 2.14 and 2.15 or subsection 2.2(c)
hereof as the case may be, on the exercise of each such special
warrant; and
(gg) "SUBJECT SECURITIES" means the Common Shares and Share Purchase
Warrants issuable upon the exercise of the Special Warrants, including
the Common Shares and Share Purchase Warrants or other securities or
property issuable upon the exercise of the Special Warrants as a
result of any adjustment of subscription rights pursuant to Sections
2.14 and 2.15 or subsection 2.2(c) hereof;
(hh) "SUCCESSOR CORPORATION" has the meaning ascribed thereto in Section
7.2;
(ii) "THIS SPECIAL WARRANT INDENTURE", "THIS INDENTURE", HEREIN", "HEREBY"
and similar expressions mean and refer to this Indenture and any
indenture, deed or instrument supplemental or ancillary hereto; and
the expressions "ARTICLE", "SECTION", "SUBSECTION" AND "CLAUSE"
followed by a number mean and refer to the specified Article, Section,
subsection or clause of this Indenture;
(jj) "TRANSFER AGENT" means the transfer agent or agents for the time being
of the Common Shares;
(kk) "TSE" means the Toronto Stock Exchange;
6.
(ll) "UNDERWRITING AGREEMENT" means the underwriting agreement made as of
the date hereof between the Underwriters, the Sellers, Xxxx Xxxxx,
Xxxxxxx Xxxxxxxxx and the Corporation;
(mm) "UNDERWRITERS" means, Yorkton Securities Inc.; and
(nn) "WRITTEN ORDER OF THE CORPORATION", "WRITTEN REQUEST OF THE
CORPORATION", "WRITTEN CONSENT OF THE CORPORATION", "CERTIFICATE OF
THE CORPORATION" and any other document required to be signed by the
Corporation, means, respectively, a written order, request, consent,
certificate or other document signed in the name of the Corporation by
any one of the president, any vice-president, or the secretary of the
Corporation, and may consist of one or more instruments so executed.
1.2 NUMBER AND GENDER
Unless elsewhere otherwise expressly provided or unless the context
otherwise requires, words importing the singular include the plural and vice
versa and words importing the masculine gender include the feminine and neuter
genders.
1.3 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.
The division of this Indenture into Articles, Sections, subsections and
clauses, 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.
1.4 BUSINESS DAY
In the event that any day on or before which any action is required or
permitted to be taken hereunder is not a Business Day, then such action shall be
required or permitted to be taken on or before the requisite time on the next
succeeding day that is a Business Day.
1.5 TIME OF THE ESSENCE
Time shall be of the essence in all respects in this Indenture.
1.6 APPLICABLE LAW
This Indenture and the Special Warrants shall be governed by and construed
in accordance with the laws of the Province of Ontario and the federal law
applicable therein and shall be treated in all respects as Ontario contracts.
7.
1.7 CHOICE OF LANGUAGE
The parties hereby acknowledge that they have expressly requested that this
Indenture and all notices, statements of account and other documents required or
permitted to be given or entered into pursuant hereto be drawn up in the English
language only. LES PARTIES RECONNAISSENT AVOIR EXPRESSMENT DEMANDEES QUE LA
PRESENTE CONVENTION AINSI QUE TOUT AVIS, TOUT ETAT DE COMPTE ET TOUT AUTRE
DOCUMENT A ETRE OU POUVANT ETRE DONNE OU CONCLU EN VERTU DES DISPOSITIONS DES
PRESENTES, SOIENT REDIGES EN LANGUE ANGLAISE SEULEMENT.
1.8 CURRENCY
Unless otherwise stated, all dollar amounts referred to in this Indenture
are in Canadian dollars.
ARTICLE 2-ISSUE OF SPECIAL WARRANTS
2.1 ISSUE OF PRIMARY SPECIAL WARRANTS AND SECONDARY SPECIAL WARRANTS
A total of 8,600,000 Special Warrants entitling the registered holders
thereof to acquire up to an aggregate of 8,600,000 Common Shares and 4,300,000
Share Purchase Warrants (subject to adjustments as provided in Sections 2.14 and
2.15 or subsection 2.2(c) hereof) are hereby created and authorized to be issued
hereunder upon the terms and conditions herein set forth and shall be executed
by the Corporation as to 8,100,000 Primary Special Warrants, 1184041 as to
350,000 Secondary Special Warrants and Xxxxxx as to 150,000 Secondary Special
Warrants certified by or on behalf of the Special Warrant Agent and delivered by
it in accordance with and upon receipt of a written direction signed by the
Corporation, 1184041 and Xxxxxx, as the case may be.
2.2 FORM AND TERMS OF SPECIAL WARRANTS
(a) The Special Warrant certificates for the 8,600,000 Special Warrants shall
be substantially in the form set out in Article 9, shall be dated as of the
date of this Indenture (regardless of their actual date of issue), and
shall have such distinguishing letters and numbers as the Corporation may,
with the approval of the Special Warrant Agent, prescribe.
(b) Subject to adjustment as provided in Sections 2.13 and 2.14 or subsection
2.2(c), each Special Warrant authorized to be issued hereunder shall
entitle the registered holder thereof to acquire in accordance with Section
3.1, at no extra cost, one (1) Unit, each Unit consisting of Common Share
and one-half ( 1/2) a Share Purchase Warrant, or such other kind and amount
of shares or securities or property, calculated pursuant to the provisions
of Sections 2.14 and 2.15 or subsection 2.2(c), as the case may be, of this
Indenture.
(c) Unless previously retracted in accordance with the provisions of Section
3.5, each Special Warrant authorized to be issued hereunder shall in the
event of a Qualification Default prior to the exercise or deemed exercise
of the Special Warrants pursuant to Section 3.1 hereof,
8.
entitle the registered holder hereof to acquire in accordance with said
Section 3.1, at no extra cost, 1.07 Units or such other kind and amount of
shares or securities or property calculated pursuant to the provisions of
Sections 2.14 and 2.15 of this Indenture.
(d) Fractional Special Warrants shall not be issued or otherwise provided for.
2.3 SIGNING OF SPECIAL WARRANT CERTIFICATES
The Special Warrant certificates shall be signed by any one of the
chairman, president, any vice-president, or the secretary of the Sellers, and
may, but need not be, under their respective corporate seals or a reproduction
thereof. The signature of such officer may be mechanically reproduced in
facsimile and Special Warrant certificates bearing such facsimile signatures
shall be binding upon the Corporation as if they had been manually signed by
such officer. Notwithstanding that the person whose manual or facsimile
signature appears on any Special Warrant certificate as such officer may no
longer hold office at the date of issue of such Special Warrant certificate or
at the date of certification or delivery thereof, any Special Warrant
certificate signed as aforesaid shall, subject to Section 2.5, be valid and
binding upon the Corporation and the registered holder thereof shall be entitled
to the benefits of this Indenture.
2.4 DEPOSIT OF SHARES UNDERLYING SECONDARY SPECIAL WARRANTS
The Sellers shall deliver to the Special Warrant Agent contemporaneously
with the execution of this Indenture, certificates representing a sufficient
number of Common Shares of the corporation (as presently constituted) to satisfy
all their respective obligations under the Secondary Special Warrants, namely
374,500 Common Shares in the case of 1184041 and 160,500 Common Shares in the
case of Xxxxxx, together with all such transfer instruments, powers of attorney
corporate resolutions and other writings as may be necessary or advisable, in
the opinion of the Special Warrant Agent to properly transfer such shares into
the name of the Special Warrant Agent for the purpose of and subject to the
terms and conditions of this Indenture.
Any such Common Shares remaining registered in the name of the Special
Warrant Agent after the expiry of the Share Purchase Warrants shall be
transferred back to the Sellers pro rata.
The delivery of such Common Share certificates and other documentation
shall constitute the Sellers' irrevocable direction and authority to the Special
Warrant Agent to deal with such Common Shares in accordance with this Indenture
and to deliver such Common Shares to the holders of the Secondary Special
Warrants upon the due exercise thereof.
2.5 CERTIFICATION BY THE SPECIAL WARRANT AGENT
9.
(a) No Special Warrant certificate shall be issued or, if issued, shall be
valid for any purpose or entitle the registered holder to the benefit
hereof or thereof until it has been certified by manual signature by or on
behalf of the Special Warrant Agent in the form of the certificate set out
in Article 9 and such certification by the Special Warrant Agent upon any
Special Warrant certificate shall be conclusive evidence as against the
Corporation that the Special Warrant certificate so certified has been duly
issued hereunder and the holder is entitled to the benefits hereof.
(b) The certification of the Special Warrant Agent on the Special Warrant
certificates issued hereunder shall not be construed as a representation or
warranty by the Special Warrant Agent as to the validity of this Indenture
or the Special Warrants (except the due certification thereof) or as to the
performance by any of the Sellers of its obligations under this Indenture
and the Special Warrant Agent shall in no respect be liable or answerable
for the use made of the Special Warrants or any of them or of the
consideration therefor except as otherwise specified herein.
2.6 SPECIAL WARRANTHOLDER NOT A SHAREHOLDER
The holding of a Special Warrant shall not be construed as conferring upon
a Special Warrantholder any right or interest whatsoever as a Shareholder, nor
entitle the Special Warrantholder to any right or interest in respect thereof
except as herein and in the Special Warrants expressly provided.
2.7 ISSUE IN SUBSTITUTION FOR LOST SPECIAL WARRANT CERTIFICATES
(a) In case any of the Special Warrant certificates shall become mutilated or
be lost, destroyed or stolen, the Corporation, subject to applicable law,
and subsection (b) of this Section 2.7, shall issue and thereupon the
Special Warrant Agent shall certify and deliver a new Special Warrant
certificate of like tenor as the one mutilated, lost, destroyed or stolen
in exchange for and in place of such mutilated certificate, or in lieu of
and in substitution for such lost, destroyed or stolen certificate, and the
substituted certificate shall be in a form approved by the Special Warrant
Agent and shall entitle its holder to the benefits hereof and shall rank
equally in accordance with its terms with all other Special Warrant
certificates issued or to be issued hereunder.
(b) The applicant for the issue of a new certificate pursuant to this Section
2.7 shall bear the cost of the issue thereof and in case of mutilation, as
a condition precedent to the issue thereof, shall deliver to the Special
Warrant Agent the mutilated certificate and in the case of loss,
destruction or theft shall, as a condition precedent to the issue thereof,
furnish to the Corporation and to the Special Warrant Agent such evidence
of ownership and of the loss, destruction or theft of the certificate so
lost, destroyed or stolen as shall be satisfactory to the Corporation and
to the Special Warrant Agent in their sole discretion, acting reasonably,
and such applicant may also be required to furnish an indemnity bond or
security in amount and
10.
form satisfactory to the Corporation and the Special Warrant Agent in their
sole discretion, acting reasonably, and shall pay the reasonable charges of
the Corporation and the Special Warrant Agent in connection therewith.
2.8 SPECIAL WARRANTS TO RANK PARI PASSU
All Special Warrants shall rank pari passu, whatever may be their actual
date of issue.
2.9 REGISTERS FOR SPECIAL WARRANTS
(a) The Issuers appoint the Special Warrant Agent as the registrar of the
Special Warrants. The Issuers may hereafter, with the consent of the
Special Warrant Agent, appoint one or more other additional registrars of
the Special Warrants. The Issuers shall cause a register to be kept by the
Special Warrant Agent, and the Special Warrant Agent agrees to maintain
such a register, at its principal transfer office in the city of Toronto,
Ontario in which shall be entered the name and addresses of the holders of
the Special Warrants and other particulars of the Special Warrants held by
them respectively and the number of Special Warrants held by them. The
Issuers shall also cause transfer agencies to be maintained by the Special
Warrant Agent, and the Special Warrant Agent shall maintain such transfer
agencies at its principal transfer office in the city of Toronto, Ontario
and in such other place or places and by such other agent or agents as the
Issuers with the approval of the Special Warrant Agent may designate.
(b) Subject to the terms of this Indenture and to applicable law, Special
Warrants may be transferred. No transfer of a Special Warrant shall be
valid unless made by the holder or his executors, administrators or other
legal representatives, or his or her attorney duly appointed by an
instrument in writing in form and manner satisfactory to the Special
Warrant Agent, acting reasonably, with signatures guaranteed by a Canadian
chartered bank, a Canadian trust company, a member firm of any Canadian
stock exchange or such other guarantor as the Special Warrant Agent
determines to be acceptable, upon surrender of the Special Warrant to the
Special Warrant Agent and upon compliance with such other reasonable
requirements as the Special Warrant Agent may prescribe and shall
thereafter be recorded on the register of transfers maintained by the
Special Warrant Agent pursuant to subsection (a) of this Section 2.9,
provided all taxes or governmental or other charges arising by reason of
such transfer have first been paid by or on behalf of the Special
Warrantholder requesting such a transfer.
2.10 TRANSFEREE ENTITLED TO REGISTRATION
11.
The transferee of a Special Warrant shall, after the transfer form attached
to the Special Warrant or any other form of transfer acceptable to the Special
Warrant Agent is duly executed and completed and together with the Special
Warrant is lodged with the Special Warrant Agent, and upon compliance with all
other conditions in that regard required by this Indenture or by law, be
entitled to have his name entered on the register of holders as the owner of
such Special Warrant free from all equities or rights of set-off or counterclaim
as set forth in Section 2.11.
2.11 REGISTERS OPEN FOR INSPECTION
The registers hereinbefore referred to shall be open at all reasonable
times for inspection by the Issuers, the Underwriter, the Special Warrant Agent
or any Special Warrantholder. The Special Warrant Agent shall, from time to time
when requested to do so in writing by the Corporation or the Underwriter,
furnish the Corporation or the Underwriter, as the case may be, with a list of
the names and addresses of holders of Special Warrants entered in the register
of holders maintained by the Special Warrant Agent and showing the number of
Common Shares which may then be acquired upon the exercise of the Special
Warrants held by each such holder.
2.12 EXCHANGE OF SPECIAL WARRANTS
(a) Special Warrant certificates may, upon compliance with the reasonable
requirements of the Special Warrant Agent, be exchanged for Special Warrant
certificates in any other authorized denomination representing in the
aggregate the same number of Special Warrants. The Corporation shall sign
and the Special Warrant Agent shall certify, in accordance with Sections
2.3 and 2.5, all Special Warrant certificates necessary to carry out the
exchanges contemplated herein.
(b) Special Warrant certificates may be exchanged only at the principal office
of the Special Warrant Agent in the City of Toronto, Ontario or at any
other place that is designated by the Corporation with the approval of the
Special Warrant Agent. Any Special Warrant certificates tendered for
exchange shall be surrendered to the Special Warrant Agent and canceled.
(c) Except as otherwise herein provided, the Special Warrant Agent may charge
Special Warrantholders requesting an exchange a reasonable sum for each
Special Warrant certificate issued, and payment of such charges and
reimbursement of the Special Warrant Agent or the Issuers for any and all
taxes or governmental or other charges required to be paid shall be made by
the party requesting such exchange as a condition precedent to such
exchange.
2.13 OWNERSHIP AND TRANSFER OF SPECIAL WARRANTS
12.
The Issuers and the Special Warrant Agent may deem and treat the registered
holder of any Special Warrant certificate as the absolute owner of the Special
Warrant evidenced thereby for all purposes, and the Issuers and the Special
Warrant Agent shall not be affected by any notice or knowledge to the contrary
except where the Issuers or the Special Warrant Agent is required to take notice
by statute or by order of a court of competent jurisdiction. A Special
Warrantholder shall be entitled to the rights evidenced by such Special Warrant
free from all equities or rights of set-off or counterclaim between the Issuers
and the original or any intermediate holder thereof and all persons may act
accordingly, and the receipt by any such Special Warrantholder of Common Shares
pursuant to the exercise thereof shall be a good discharge to the Issuers and
the Special Warrant Agent for the same, and neither the Corporation nor the
Special Warrant Agent shall be bound to inquire into the title of any such
holder, except where the Corporation or the Special Warrant Agent is required to
take notice by statute or by order of a court of competent jurisdiction.
2.14 ADJUSTMENT OF SUBSCRIPTION RIGHTS
Subject to Sections 2.15 and 2.16, if at any time after the date hereof and
prior to the Expiry Time, and provided that any Special Warrants remain
unexercised, there shall be:
(a) a reclassification of the Common Shares at any time or a change of the
Common Shares into other shares or securities or a subdivision or
consolidation of the Common Shares into a greater or lesser number of
shares or any other capital reorganization;
(b) a consolidation, amalgamation or merger of the Corporation with or into any
other corporation (other than a consolidation, amalgamation or merger which
does not result in any reclassification of the outstanding Common Shares or
a change of the Common Shares into other Common Shares or securities);
(c) a transfer of the undertaking or assets of the Corporation as an entirety
or substantially as an entirety to another corporation or other entity; or
(d) an issue or distribution to the holders of all or substantially all of the
Corporation's outstanding Common Shares or securities of the Corporation
including rights, options or warrants to acquire Common Shares or
securities convertible into or exchangeable for Common Shares or any
property or assets including any evidences of indebtedness, other than cash
dividends paid in the ordinary course of the Corporation or securities
issued pursuant to the Corporation's stock option plans,
(any of such events being called a "Capital Reorganization"), the holder of any
Special Warrants that may thereafter be exercised to acquire Common Shares shall
be entitled to receive, and shall accept for no extra cost, in lieu of the
number of Common Shares to which he was theretofore entitled upon such exercise,
the kind and amount of shares or other securities or property which such holder
would have been entitled to receive as a result of such Capital Reorganization
if, on the effective date thereof or the record date, as the case may be, he had
been the registered holder of the number of Common Shares which he was
theretofore entitled to acquire upon such exercise. Any such
13.
adjustments shall be made by and set forth in an indenture supplemental hereto
approved by the directors and shall for all purposes be prima facie deemed to be
an appropriate adjustment absent manifest error.
2.15 ADJUSTMENT RULES
(1) The adjustments provided for in Section 2.14 are cumulative and shall apply
(without duplication) to successive Capital Reorganizations or other events
resulting in any adjustment under the provisions of Section 2.14; provided
that, notwithstanding any other provision of this Article 2, no adjustment
shall be made in the number of Common Shares which may be acquired on the
exercise of a Special Warrant unless it would result in a change of at
least one one-hundredth of a Share (provided, however, that any adjustments
which by reason of this subsection 2.15(1) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment).
(2) The Corporation shall not issue fractional Common Shares in satisfaction of
its obligations hereunder. If any fractional interests in a Common Share
would, except for the provisions of this subsection 2.15(2), be deliverable
upon the exercise of the Special Warrant, the Corporation shall make a cash
payment equal to the fair value of the fraction of a Share not so issued as
determined by the Corporation's auditors in their sole discretion. No
cheque shall be issued or cash payment made to any Special Warrantholder
for an amount less than $5.00.
(3) If any question arises with respect to the adjustments provided in this
Article 2 such question shall, absent manifest error, be conclusively
determined by the Corporation's auditors or such other firm of chartered
accountants appointed by the Corporation and acceptable to the Special
Warrant Agent (who may be the Corporation's auditors). Such chartered
accountants shall have access to all necessary records of the Corporation
and such determination shall be binding upon the Corporation, the Special
Warrant Agent and the Special Warrantholders absent manifest error.
(4) No adjustment in the number of Common Shares which may be acquired upon
exercise of a Special Warrant shall be made in respect of any event
described in Section 2.15 if Special Warrantholders are entitled to
participate in such event on the same terms mutatis mutandis as if Special
Warrantholders had exercised their Special Warrants prior to or on the
effective date or record date of such event.
(5) If, after the date of this Indenture, the Corporation shall take any action
affecting the Common Shares other than the actions described in this
Article 2 which in the opinion of the directors of the Corporation would
materially affect the rights of Special Warrantholders, the number of
Common Shares which may be acquired upon the exercise of a Special Warrant
shall be adjusted in such manner and at such time, by action by the
directors, in their sole discretion, acting reasonably, as they may
determine to be equitable in the circumstances; provided that no such
adjustment will be made unless prior approval of any stock exchange on
which the Common Shares are listed for trading, if required, has been
obtained. Failure of the directors to make such an adjustment shall be
conclusive evidence that the directors have determined that it is equitable
to make no adjustment in the circumstances. In the event that any such
adjustment is made, the
14.
Corporation shall deliver a certificate of the Corporation to the Special
Warrant Agent describing such adjustment.
2.16 NOTICE OF ADJUSTMENT OF SUBSCRIPTION RIGHTS
(1) At least 10 days prior to the effective date or record date, as the case
may be, of any event which would require an adjustment in any of the
subscription rights pursuant to any of the Special Warrants, including the
number of Common Shares which may be acquired upon the exercise thereof, the
Corporation shall:
(a) file with the Special Warrant Agent a certificate of the Corporation
specifying the particulars of such event and, if determinable, the required
adjustment and the computation of such adjustment; and
(b) give notice to the Special Warrantholders of the particulars of such event
and, if determinable, the required adjustment, in the manner provided for
in Section 10.2.
(2) In case of any adjustment for which a notice provided for in subsection
2.16(1) has been given is not then determinable or in case a question arises and
a determination has been made in accordance with Section 2.15(3), the
Corporation shall promptly after such adjustment is determinable or conclusion
reached:
(a) file with the Special Warrant Agent a certificate of the Corporation
showing how such adjustment was computed; and
(b) give notice to the Special Warrantholders of the adjustment in the manner
provided for in Section 10.2.
(3) Where a notice referred to in subsection 2.16(1) or (2) has been given, the
Special Warrant Agent shall be entitled to act and rely absolutely on any
adjustment calculation of the Corporation or the Corporation's auditors.
2.17 PROCEEDINGS PRIOR TO ANY ACTION REQUIRING ADJUSTMENT
As a condition precedent to the taking of action which would require an
adjustment pursuant to Sections 2.14 and 2.15, the Corporation shall take any
action which may, in the opinion of the Corporation's counsel, be necessary in
order that the Corporation may validly and legally issue as fully paid and non-
assessable all the Subject Securities which the holders of the Special Warrants
are entitled to receive on the complete exercise thereof in accordance with the
provisions hereof.
2.18 PROTECTION OF THE SPECIAL WARRANT AGENT
The Special Warrant Agent shall be entitled to act and rely on any
adjustment calculation of the Issuers' auditors and the Special Warrant Agent
shall not:
15.
(a) at any time be under any duty or responsibility to any holder to
determine whether facts exist which may require any adjustment
contemplated by this article, or with respect to the nature or extent
of any such adjustment when made, or with respect to the method
employed in making same;
(b) be accountable with respect to the validity or value (or the kind or
amount) of any shares or of any other shares or securities or property
which may at any time be issued or delivered upon the exercise or
deemed exercise of any Special Warrant; or
(c) be responsible for any failure of the Issuers to make any cash payment
or to issue, transfer or deliver shares or share certificates upon the
surrender of any Special Warrant for the purpose of exercise or deemed
exercise, or to comply with any of the covenants contained in this
article.
ARTICLE 3 - EXERCISE OF SPECIAL WARRANTS
3.1 EXERCISE OF SPECIAL WARRANTS AND DEEMED EXERCISE OF SPECIAL WARRANTS
(a) Upon and subject to the provisions of this Article 3, any holder of a
Special Warrant which has not previously been retracted pursuant to Section
3.5 may exercise the right thereby conferred on him to acquire the Subject
Securities, at no additional cost, by surrendering to the Special Warrant
Agent at any time prior to the Expiry Time, in the manner set forth in
subsection 3.1(c), the certificate evidencing the Special Warrants, with
the Exercise Form attached to the Special Warrant certificate duly
completed and executed by the holder or his executors, administrators or
other legal representatives or his or their attorney duly appointed by an
instrument in writing in form and manner satisfactory to the Special
Warrant Agent, acting reasonably.
The Exercise Form attached to the Special Warrant certificate shall be
signed as set out above and shall specify:
(i) the number of Subject Securities which the Special Warrantholder
desires to acquire on exercise of the Special Warrants (being not
more than those which he is entitled to acquire pursuant to the
Special Warrant certificate so surrendered); and
(ii) the person or persons in whose names the Subject Securities are
to be issued, his or their address or addresses and the number of
Subject Securities to be issued to each such person if more than
one is so specified.
If any of the Subject Securities in respect of which the Special Warrants
are exercised are to be issued to a person or persons other than the
Special Warrantholder, the Special Warrantholder shall pay to the Special
Warrant Agent all requisite stamp or security transfer
16.
taxes or other governmental charges exigible in connection with the issue
of such Subject Securities to such other person or persons or shall
establish to the satisfaction of the Special Warrant Agent that such taxes
and charges have been paid. Furthermore, in such event the signature on the
Exercise Form must be guaranteed by a Canadian chartered bank, a Canadian
trust company, a member firm of any Canadian stock exchange or such other
guarantor as the Special Warrant Agent determines to be acceptable.
If at the time of the exercise of the Special Warrants, there remain
trading restrictions on the Subject Securities acquired, due to applicable
securities legislation, the Corporation may, on the advice of counsel,
endorse the certificates representing the Subject Securities to such
effect, and prior to issuance of any such certificates the Special Warrant
Agent shall consult the Corporation to determine whether such endorsement
or legending is required.
(b) Any Special Warrants not otherwise exercised for the Subject Securities or
retracted pursuant to Section 3.5 shall be deemed to have been exercised on
the earlier of (i) the fifth Business Day after the Qualification Date, and
(ii) immediately prior to the Expiry Time without any further action on the
part of the holder thereof.
(c) In order to acquire certificates representing the Subject Securities, a
holder of one or more Special Warrants must deliver the Special Warrant
certificates evidencing such Special Warrants to the Special Warrant Agent
at its principal office in the City of Toronto, Ontario (or at such
additional place or places as may be determined by the Corporation from
time to time with the approval of the Special Warrant Agent) or by first
class mail, postage prepaid to CIBC Mellon Trust Company at its principal
office in Toronto, Ontario. A Special Warrant certificate shall be deemed
to be surrendered only upon personal delivery thereof or if sent by mail,
upon actual receipt thereof by the Special Warrant Agent.
3.2 EFFECT OF EXERCISE OF SPECIAL WARRANTS
(a) The Subject Securities in respect of which the Special Warrants are
exercised shall be deemed to have been issued on the Exercise Date at which
time each Special Warrantholder shall be deemed to have become the holder
of record of the Subject Securities issued in respect of the Special
Warrants held by such Special Warrantholder unless the transfer books of
the Corporation shall be closed by law on the said date of such exercise,
in which case such Subject Securities shall be deemed to have been issued
and such Special Warrantholder shall be deemed to have become the holder of
record of such Subject Securities on the date on which such transfer books
are next re-opened.
(b) Forthwith after the Exercise Date and subject to the delivery by a Special
Warrantholder of Special Warrant Certificates and the Exercise Form to the
Special Warrant Agent as provided in subsection 3.1(c), and 3.1(a)(i) and
(ii) respectively, the Issuers shall, subject to the provisions of Section
3.3, cause to be delivered to each Special Warrantholder or mailed to it at
its address specified in the register of holders maintained by the Special
Warrant Agent
17.
or certificates for the appropriate number of Subject Securities not
exceeding those which such Special Warrantholder is entitled to acquire
pursuant to the Special Warrants delivered by the Special Warrantholder to
the Special Warrant Agent.
3.3 POSTPONEMENT OF DELIVERY OF CERTIFICATES
The Issuers shall not be required to deliver certificates for Common Shares
during the period when the transfer books of the Corporation are closed by law
and, in the event of a surrender of a Special Warrant for the acquisition of
Subject Securities during such period, the delivery of certificates may be
postponed for a period not exceeding five (5) Business Days after the date of
the re-opening of the transfer books.
3.4 CANCELLATION OF SPECIAL WARRANT CERTIFICATES
All Special Warrant certificates surrendered to the Special Warrant Agent
pursuant to Sections 2.7, 2.10, 2.12, 3.1 or 3.5 shall be cancelled by the
Special Warrant Agent. The Special Warrant certificates evidencing all Special
Warrants exercised pursuant to Section 3.1 shall be deemed to have been
cancelled on the Exercise Date and the Special Warrant Agent shall record the
cancellation or deemed cancellation of such Special Warrant certificates on the
register of holders maintained by the Special Warrant Agent pursuant to
subsection 2.9(a). The Special Warrant Agent shall, if required in writing by
the Issuers, furnish the Issuers with a certificate of destruction identifying
the Special Warrant certificates so cancelled and deemed to have been cancelled.
All Special Warrants evidenced by Special Warrant certificates which have been
validly cancelled or which are deemed to have been cancelled pursuant to this
Section 3.4 shall be without further force or effect whatsoever.
18.
3.5 SPECIAL WARRANT RETRACTION PRIVILEGE
(1) In the event of a Qualification Default not later than the Business Day
next following the date of such Qualification Default, the Corporation shall
notify or cause the Special Warrant Agent to notify the Escrow Agent and the
Special Warrantholders of that fact and of the Retraction Privilege (defined
below) by facsimile transmission or, in the event that the Corporation and the
Special Warrant Agent do not have a facsimile number for a Warrantholder in the
manner provided in Section 10.2, and each holder of the Special Warrants upon
receiving said notice, shall have the right to retract (the "Retraction
Privilege") up to 75% of the Special Warrants held by such holders at any time
prior to 5:00 p.m. (Toronto time) on the fifth Business Day following the date
of the Qualification Default (the "Retraction Deadline") and to receive in
consideration therefor an amount equal to $1.40 per Special Warrant, together
with accrued interest thereon to and including the date of payment less any
amount required to be held by applicable law (the "Retraction Amount"). Any
failure to exercise the Retraction Privilege shall not affect or otherwise limit
a Special Warrantholder's right pursuant to section 2(c) of this Indenture to
receive 1.07 Common Shares and 0.535 Share Purchase Warrants upon exercise or
deemed exercise of the holder's Special Warrants following a Qualification
Default.
(2) In order to exercise the Retraction Privilege, a Special Warrantholder must
surrender to the Special Warrant Agent, at its principal office in the City of
Toronto (or at such additional place or places as may be decided by the
Corporation from time to time and approved by the Special Warrant Agent), the
Special Warrants held by such holder which such holder is entitled to retract
(provided that such Special Warrant shall be deemed to be surrendered only upon
personal delivery thereof, or if sent by mail or other means of transmission,
upon actual receipt thereof by the Special Warrant Agent) together with a notice
(the "Notice of Retraction") in the form attached as Schedule "C" to the Special
Warrant certificate, signed by such holder retracting such Special Warrants and
the Special Warrant Agent shall as soon as practicable provide a copy of such
Notice of Retraction to the Escrow Agent and request a cheque payable to the
Special Warrantholder equal to the aggregate Retraction Amount for all such
Special Warrants to be retracted.
(3) On the date of the receipt by the Special Warrant Agent of a Notice of
Retraction and a Warrant Certificate representing the Special Warrants
surrendered for retraction, the Retraction Amount payable to such Warrantholder
shall become due and, within three Business Days thereafter, the Special Warrant
Agent shall send the Warrantholder the Escrow Agent's cheque payable in Canadian
funds in the amount of such Retraction Amount; cancel the Warrant Certificate or
Certificates so surrendered, and issue a new Special Warrant Certificate to each
Special Warrantholder representing any remaining Special Warrants which the
holder did not retract.
(4) If Special Warrants are surrendered for retraction pursuant hereto and the
Retraction Amounts representing such Special Warrants are not paid in full when
due, such Special Warrants shall remain outstanding and the Special Warrant
Agent shall hold the certificates representing such Special Warrants on behalf
of and for the benefit of the relevant Special Warrantholders until such
Retraction Amounts are paid in full at which time the retraction shall be
completed.
19.
ARTICLE 4 - COVENANTS
4.1 GENERAL COVENANTS
Each of the Corporation and, in the case of paragraphs 4.1(a), (d), (f),
(h), (i), (j) and (k), the Sellers, covenants with the Special Warrant Agent
that so long as any Special Warrants remain outstanding:
(a) It will maintain its corporate existence and will carry on and conduct its
business in accordance with good business practice.
(b) It will send to each Special Warrantholder copies of all financial
statements and other material furnished to the holders of Common Shares
after the date of this Indenture.
(c) It will reserve and there will remain unissued out of its authorized
capital a sufficient number of Common Shares to satisfy the rights of
acquisition on the exercise of the Primary Special Warrants and the Share
Purchase Warrants as provided for herein.
(d) It will cause the Subject Securities issuable upon the exercise of the
Special Warrants in the manner herein provided to be duly issued and
delivered in accordance with the Special Warrants and the terms hereof.
(e) It will use its reasonable best efforts to maintain the quotation of the
Common Shares on the TSE and to become or maintain its status as (as the
case may be) a "reporting issuer" not in default of the requirements of the
securities legislation and policies of each of the Qualifying
Jurisdictions.
(f) All of the Subject Securities which are issued on the exercise of the
Special Warrants shall be issued as fully-paid and non-assessable and the
holders thereof shall not be liable to the Corporation or its creditors in
respect of the issue of such Subject Securities.
(g) The Corporation covenants and agrees to (i) file a Preliminary Prospectus
for the purpose of qualifying the issuance and distribution of the Subject
Securities upon the exercise of the Primary and Secondary Special Warrants
in each of the Qualifying Jurisdictions as soon as practicable following
the date hereof; (ii) resolve all comments received or deficiencies raised
by the Securities Administrators; and (iii) file and obtain receipts for
the Final Prospectus in each of the Qualifying Jurisdictions qualifying the
Subject Securities as soon as possible after such regulatory comments and
deficiencies have been resolved and obtain the listing and posting of the
Common Shares issuable on exercise of the Special Warrants upon the TSE on
or before the Expiry Time.
20.
(h) It will not take any other action which might deprive the Special
Warrantholders of the opportunity of exercising their rights pursuant to
the Special Warrants held by such persons during the period of notice
required by subsection 2.16(1).
(i) It will perform all its covenants and carry out all of the acts or things
to be done by it as provided in this Indenture.
(j) It will not amend the attributes of the Subject Securities without the
prior written consent, in the form of an Extraordinary Resolution, of the
holders of two-thirds of the outstanding Special Warrants.
(k) It will send a written notice to the Special Warrant Agent and to each
holder of Special Warrants of the issuance of the receipts referred to in
subsection 4.1(g), together with a commercial copy of the Final Prospectus
qualifying the Subject Securities for distribution, as soon as practicable
but, in any event, not later than three Business Days after the
Qualification Date and, in the case of the Special Warrant Agent, copies of
such receipts and written confirmation of any adjustment to subscription
rights.
(l) It will send a written notice to the Special Warrant Agent and to each
Special Warrantholder of the record date for the determination of holders
of Common Shares for the purposes of any dividend or other distribution or
rights offering to holders of such securities not later than 10 Business
Days prior to such record date.
(m) It will send a written notice to the Special Warrant Agent and to Special
Warrantholders of the occurrence of a Qualification Default and, as a
result therefrom, each Special Warrantholder's increased entitlement as
contemplated by section 2.2(c).
(n) In the event that it offers any of its securities for sale in the United
States or files a registration statement with the United States Securities
Exchange Commission in respect of any of its securities, whether in
connection with a public offering of such securities, an application for
listing or quotation of its securities on any stock market or quotation
system in the United States or otherwise, the Corporation shall ensure that
the Subject Securities are also registered for resale in the United States
or on such stock exchange and take all such other steps and actions as may
be necessary to ensure that the Subject Securities are not subject to any
statutory hold period.
4.2 SECURITIES QUALIFICATION REQUIREMENTS
21.
(a) If, in the opinion of the Corporation's counsel, any instrument (other than
the Final Prospectus) is required to be filed with, or any permission,
order or ruling is required to be obtained from, any Securities
Administrator or any other step is required under any federal or provincial
law of Canada before any Subject Securities may be issued or delivered to a
Special Warrantholder in any of the Qualifying Jurisdictions upon exercise
of its Special Warrants, free of any restrictions or limitations on resale
of such Subject Securities, the Corporation covenants that it will file
such instrument, obtain such permission, order or ruling or take all such
other actions, at its expense, as is required or appropriate in the
circumstances.
(b) The Corporation will give written notice of the issue of the Subject
Securities pursuant to the exercise of Special Warrants in such detail as
may be required to the Securities Administrator in each of the Qualifying
Jurisdictions in which there is legislation requiring the giving of any
such notice.
4.3 SPECIAL WARRANT AGENT'S REMUNERATION AND EXPENSES
The Corporation covenants that it will pay to the Special Warrant Agent
such fees as the parties agree upon from time to time for its services hereunder
and will pay or reimburse the Special Warrant Agent upon its request for all
reasonable expenses and disbursements of the Special Warrant Agent in the
administration or execution of the trusts hereby created (including, pursuant to
subsection 8.3(f), the reasonable compensation and the disbursements of its
counsel and all other advisers, experts, accountants and assistants not
regularly in its employ) both before any default hereunder and thereafter until
all duties of the Special Warrant Agent hereunder shall be finally and fully
performed, except any such expense or disbursement in connection with or related
to or required to be made as a result of the negligence, wilful misconduct or
bad faith of the Special Warrant Agent.
4.4 PERFORMANCE OF COVENANTS BY SPECIAL WARRANT AGENT
Subject to subsection 8.2(g), if the Issuers shall fail to perform any of
their covenants contained in this Indenture and the Issuers have not rectified
such failure within ten Business Days after receiving written notice from the
Special Warrant Agent of such failure, the Special Warrant Agent shall notify
the Special Warrantholders of such failure on the part of the Issuers unless the
Special Warrant Agent shall itself perform any of the said covenants capable of
being performed by it, but shall be under no obligation to perform said
covenants or to notify the Special Warrantholders. All reasonable sums expended
or disbursed by the Special Warrant Agent in so doing shall be repayable as
provided in Section 4.3. No such performance, expenditure or disbursement by the
Special Warrant Agent shall be deemed to relieve the Issuers of any default
herein or of their continuing obligations under the covenants herein contained.
22.
ARTICLE 5-ENFORCEMENT
5.1 SUITS BY SPECIAL WARRANTHOLDERS
All or any of the rights conferred upon a Special Warrantholder by the
terms of the Special Warrants held by such Special Warrantholder and/or this
Indenture may be enforced by such Special Warrantholder by appropriate legal
proceedings, but subject to the rights which are hereby conferred upon the
Special Warrant Agent and subject to the provisions of Section 6.10.
5.2 IMMUNITY OF SHAREHOLDERS, ETC.
Subject to applicable laws, the Special Warrant Agent and, by the
acceptance of the Special Warrant certificates and as part of the consideration
for the issue of the Special Warrants, the Special Warrantholders hereby waive
and release any right, cause of action or remedy now or hereafter existing in
any jurisdiction against any person in his capacity as an incorporator or any
past, present or future shareholder of the Issuers or other security holder,
director, officer, employee or agent of the Issuers for the issue of the Common
Shares pursuant to the exercise of any Special Warrant or on any covenant,
agreement, representation or warranty by the Corporation herein or in the
Special Warrant certificates contained.
5.3 LIMITATION OF LIABILITY
The obligations hereunder are not personally binding upon, nor shall resort
hereunder be had to, the shareholders or the directors of the Issuers or any of
the past, present or future shareholders or directors of the Issuers or any of
the past, present or future officers, employees or agents of the Issuers, but
only the Issuers and their property shall be bound in respect hereof.
ARTICLE 6 - MEETINGS OF SPECIAL WARRANTHOLDERS
6.1 RIGHT TO CONVENE MEETINGS
The Special Warrant Agent may at any time and from time to time, and shall
on receipt of a written request of the Issuers or of a Special Warrantholders'
Request, convene a meeting of the Special Warrantholders provided that the
Special Warrant Agent is indemnified and funded to its reasonable satisfaction
by the Issuers or by the Special Warrantholders signing such Special
Warrantholders' Request against the costs, charges, expenses and liabilities
which may be incurred in connection with the calling and holding of such
meeting. If within 15 Business Days after the receipt of a written request of
the Issuers or a Special Warrantholders' Request and indemnity and funding given
as aforesaid the Special Warrant Agent fails to give the requisite notice
specified in Section 6.2 to convene a meeting, the Issuers or such Special
Warrantholders, 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 Special Warrant Agent and the Issuers.
23.
6.2 NOTICE
At least 15 days' prior notice of any meeting of Special Warrantholders
shall be given to the registered Special Warrantholders, at the expense of the
Issuers, in the manner provided for in Section 10.2 and a copy of such notice
shall be delivered to the Special Warrant Agent unless the meeting has been
called by the Special Warrant Agent, and also to the Issuers, unless the meeting
has been called by the Issuers. Such notice shall state the time and place of
the meeting and the general nature of the business to be transacted thereat, and
shall contain such information as is reasonably necessary to enable the Special
Warrantholders to make a reasoned decision on the matters for which such meeting
has been called, but 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 6. The notice convening any such meeting may be signed by the Special
Warrant Agent or of the Issuers or the person designated by such Special
Warrantholders, as the case may be.
6.3 CHAIRMAN
The Special Warrant Agent may nominate in writing an individual to be
chairman of the meeting and if no individual is so nominated, or if the
individual so nominated is not present within 15 minutes after the time fixed
for the holding of the meeting, the Special Warrantholders present in person or
by proxy shall appoint an individual present to be chairman of the meeting. The
chairman of the meeting need not be a Special Warrantholder.
6.4 QUORUM
Subject to the provisions of Section 6.11, at any meeting of the Special
Warrantholders a quorum shall consist of one or more Special Warrantholders
present in person or represented by proxy and holding at least 25% of the then
issued and outstanding Special Warrants. If a quorum of the Special
Warrantholders shall not be present within one half-hour from the time fixed for
holding any meeting, the meeting, if summoned by the Special Warrantholders or
on a Special Warrantholder's Request, 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) at the same time and place to the extent possible and, subject to
the provisions of Section 6.1, no notice of the adjournment need be given. Any
business may be brought before or dealt with at an adjourned meeting which might
have been dealt with at the original meeting in accordance with the notice
calling the same. At the adjourned meeting the Special Warrantholders present in
person or represented by proxy (regardless of number) shall form a quorum and
may transact the business for which the meeting was originally convened,
notwithstanding that they may hold less than 25% of the then issued and
outstanding Special Warrants. No business shall be transacted at any meeting
unless a quorum is present at the commencement of the meeting.
24.
6.5 POWER TO ADJOURN
The chairman of any meeting at which a quorum of the Special Warrantholders
is present may, with the consent of the meeting, adjourn any such meeting, and
no notice of such adjournment need be given except such notice, if any, as the
meeting may prescribe.
6.6 SHOW OF HANDS
Every question submitted to a meeting shall be decided in the first place
by a majority of the votes given on a show of hands except that votes on an
extraordinary resolution 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 chairman of the meeting 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.
6.7 POLL AND VOTING
On every extraordinary resolution, and when demanded by the chairman of the
meeting or by one or more of the Special Warrantholders acting in person or by
proxy on any other question submitted to a meeting and after a vote by show of
hands, a poll shall be taken in such manner as the chairman of the meeting shall
direct. Questions other than those required to be determined by extraordinary
resolution shall be decided by a majority of the votes cast on the poll. On a
show of hands, every person who is present and entitled to vote, whether as a
Special Warrantholder or as a proxy for one or more absent Special
Warrantholders, or both, shall have one vote. On a poll, each Special
Warrantholder present in person or represented by a proxy duly appointed by
instrument in writing shall be entitled to one vote in respect of each Special
Warrant which he (or the Special Warrantholder appointing him as proxy) then
holds. A proxy need not be a Special Warrantholder. The chairman of any meeting
shall be entitled, both on a show of hands and on a poll, to vote in respect of
the Special Warrants, if any, held or represented by him.
6.8 REGULATIONS
Subject to the provisions of this Indenture, the Special Warrant Agent or
the Issuers with the approval of the Special Warrant Agent may from time to time
make and from time to time vary such regulations as it shall reasonably consider
necessary or appropriate:
(a) for the deposit of instruments appointing proxies at such place and time as
the Special Warrant Agent, the Issuers or the Special Warrantholders
convening the meeting, as the case may be, may in the notice convening the
meeting direct, and enabling particulars of such instruments appointing
proxies to be mailed or transmitted by facsimile before the meeting to the
Issuers or to the Special Warrant Agent and for the voting of proxies so
deposited as though the instruments themselves were produced at the
meeting;
25.
(b) as to the form of the instrument of proxy; and
(c) generally for the calling of meetings of Special Warrantholders and the
conduct of business thereat, including setting a record date for Special
Warrantholders entitled to receive notice of or to vote at such meeting;
such regulations to be effectual only once notice thereof has been given to
Special Warrantholders in accordance with the provisions of Section 10.2
hereof prior to or concurrently with notice of the first meeting at which
such regulations are to apply.
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 a Special Warrantholder, or be entitled to vote or be present at
the meeting in respect thereof (subject to Section 6.9), shall be Special
Warrantholders or persons holding proxies of Special Warrantholders.
6.9 ISSUERS, SPECIAL WARRANT AGENT AND UNDERWRITER MAY BE REPRESENTED
The Issuers, the Underwriter and the Special Warrant Agent, by their
respective directors, officers and employees and the counsel for each of the
Issuers, the Underwriter, the Special Warrantholders and the Special Warrant
Agent may attend any meeting of the Special Warrantholders and speak thereat but
shall have no vote as such.
6.10 POWERS EXERCISABLE BY EXTRAORDINARY RESOLUTION
In addition to all other powers conferred upon them by any other provisions
of this Indenture or by law, the Special Warrantholders at a meeting of Special
Warrantholders shall have the power, exercisable from time to time by
extraordinary resolution:
(a) to agree with the Issuers to any modification, alteration, compromise or
arrangement of the rights of Special Warrantholders and/or the Special
Warrant Agent in its capacity as special warrant agent hereunder subject to
the Special Warrant Agent's prior written consent or on behalf of the
Special Warrantholders against the Corporation whether such rights arise
under this Indenture or the Special Warrants or otherwise;
(b) to amend or repeal any extraordinary resolution previously passed or
sanctioned by the Special Warrantholders;
(c) to direct or authorize the Special Warrant Agent subject to receipt of
funding and indemnity to enforce any of the covenants on the part of the
Issuers contained in this Indenture or the Special Warrants or to enforce
any of the rights of the Special Warrantholders in any manner specified in
such extraordinary resolution or to refrain from enforcing any such
covenant or right;
26.
(d) to waive and/or direct the Special Warrant Agent to waive any default on
the part of the Issuers in complying with any provisions of this Indenture
or the Special Warrants either unconditionally or upon any conditions
specified in such extraordinary resolution;
(e) to restrain any Special Warrantholder from taking or instituting any suit,
action or proceeding against the Issuers for the enforcement of any of the
covenants on the part of the Issuers contained in this Indenture or the
Special Warrants or to enforce any of the rights of the Special
Warrantholders;
(f) to direct any Special Warrantholder who, as such, has brought any suit,
action or proceeding to stay or discontinue or otherwise deal with any such
suit, action or proceeding, upon payment of the costs, charges and expenses
reasonably and properly incurred by such Special Warrantholder in
connection therewith; and
(g) to remove the Special Warrant Agent and to appoint a successor special
warrant agent.
6.11 MEANING OF EXTRAORDINARY RESOLUTION
(a) The expression "EXTRAORDINARY RESOLUTION" when used in this Indenture
means, subject as hereinafter in this Section 6.11 and in Section 6.14
provided, a resolution proposed at a meeting of Special Warrantholders duly
convened for that purpose and held in accordance with the provisions of
this Article 6 at which there are present in person or represented by proxy
Special Warrantholders holding at least 25% of the then issued and
outstanding Special Warrants and passed by the affirmative votes of Special
Warrantholders holding not less than 66% of the then issued and
outstanding Special Warrants represented at the meeting and voted on the
poll upon such resolution.
(b) If, at any meeting called for the purpose of passing an extraordinary
resolution, Special Warrantholders holding at least 25% of the then issued
and outstanding Special Warrants are not present in person or by proxy
within one half-hour after the time appointed for the meeting, then the
meeting, if convened by Special Warrantholders or on a Special
Warrantholders' Request, shall be dissolved; but in any other case it shall
stand adjourned to such day, being not less than four or more than ten
Business Days later, and to such place and time as may be appointed by the
chairman of the meeting. Not less than three Business Days' prior notice
shall be given of the time and place of such adjourned meeting in the
manner provided in Sections 10.1, 10.2 and 10.3. Such notice shall state
that at the adjourned meeting the Special Warrantholders present in person
or represented by proxy shall form a quorum but it shall not be necessary
to set forth the purposes for which the meeting was originally called or
any other particulars. At the adjourned meeting the Special Warrantholders
present in person or represented 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 by the requisite
vote as provided in subsection (a) of this Section 6.11 shall be an
extraordinary resolution within the meaning
27.
of this Indenture notwithstanding that Special Warrantholders holding at
least 25% of the then issued and outstanding Special Warrants are not
present in person or represented 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.
6.12 POWERS CUMULATIVE
It is hereby declared and agreed that any one or more of the powers or any
combination of the powers in this Indenture stated to be exercisable by the
Special Warrantholders by extraordinary resolution or otherwise may be exercised
from time to time and the exercise of any one or more of such powers or any
combination of powers from time to time shall not be deemed to exhaust the right
of the Special Warrantholders to exercise such powers or combination of powers
then or thereafter from time to time.
6.13 MINUTES
Minutes of all resolutions and proceedings at every meeting of Special
Warrantholders shall be made and duly entered in books to be from time to time
provided for that purpose by the Special Warrant Agent at the reasonable expense
of the Issuers, and any such minutes as aforesaid, if signed by the chairman of
the meeting at which such resolutions were passed or proceedings held, or by the
chairman of the next succeeding meeting of the Special Warrantholders, 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 convened and held, and all
resolutions passed thereat or proceedings taken shall be deemed to have been
duly passed and taken.
6.14 INSTRUMENTS IN WRITING
All actions which may be taken and all powers that may be exercised by the
Special Warrantholders at a meeting held as provided in this Article 6 may also
be taken and exercised by Special Warrantholders holding at least 66% of the
then issued and outstanding Special Warrants by an instrument in writing signed
in one or more counterparts by such Special Warrantholders in person or by
attorney duly appointed in writing, and the expression "extraordinary
resolution" when used in this Indenture shall include an instrument so signed.
6.15 BINDING EFFECT OF RESOLUTIONS
Every resolution and every extraordinary resolution passed in accordance
with the provisions of this Article 6 at a meeting of Special Warrantholders
shall be binding upon all the Special Warrantholders, whether present at or
absent from such meeting, and every instrument in writing signed by Special
Warrantholders in accordance with Section 6.14 shall be binding upon all the
Special Warrantholders, whether signatories thereto or not, and each and every
Special
28.
Warrantholder and the Special Warrant Agent (subject to the provisions for
indemnity herein contained) shall be bound to give effect accordingly to every
such resolution and instrument in writing. In the case of an instrument in
writing, the Special Warrant Agent shall give notice in the manner contemplated
in Sections 10.1 and 10.2 of the effect of the instrument in writing to all
Special Warrantholders and the Issuers as soon as is reasonably practicable.
6.16 HOLDINGS BY THE CORPORATION OR SUBSIDIARIES OF THE CORPORATION DISREGARDED
In determining whether Special Warrantholders holding the required number
of Special Warrants are present at a meeting of Special Warrantholders for the
purpose of determining a quorum or have concurred in any consent, waiver,
resolution, extraordinary resolution, Special Warrantholders' Request or other
action under this Indenture, Special Warrants owned legally or beneficially by
the Issuers or any associate or affiliate (as those terms are defined in the
Securities Act (Ontario)) of the Issuers shall be disregarded. The Issuers shall
provide to the Special Warrant Agent upon request a Certificate of the Issuers
stating the exact number and registrations of Special Warrants held by the
Corporation or any associate or affiliate.
ARTICLE 7 - SUPPLEMENTAL INDENTURES
7.1 SUPPLEMENTAL INDENTURES
From time to time the Issuers and the Special Warrant Agent may, subject to the
provisions of this Indenture, and they shall, when so directed by this
Indenture, execute and deliver by their proper officers, indentures or
instruments supplemental hereto, which thereafter shall form part hereof, for
any one or more or all of the following purposes:
(a) adding to the provisions hereof such additional covenants and enforcement
provisions as in the opinion of counsel are necessary or advisable,
provided that the same are not, in the opinion of the Special Warrant
Agent, based on the advice of its Counsel, prejudicial to the interests of
the Special Warrantholders as a group;
(b) giving effect to any extraordinary resolution passed as provided in Article
6;
(c) making such provisions not inconsistent with this Indenture as may be
necessary or desirable with respect to matters or questions arising
hereunder, provided that such provisions are not, in the opinion of the
Special Warrant Agent, based on the advice of its counsel, prejudicial to
the interests of the Special Warrantholders as a group;
(d) adding to or amending the provisions hereof in respect of the transfer of
Special Warrants, providing for the exchange of Special Warrants, and
making any modification in the form of the certificates for the Special
Warrants provided that such additions, amendments or modifications are not,
in the opinion of the Special Warrant Agent, based on the advice of its
Counsel, prejudicial to the interests of the Special Warrantholders as a
group;
29.
(e) amending any of the provisions of this Indenture or relieving the Issuers
from any of the obligations, conditions or restrictions herein contained,
provided that no such amendment or relief shall be or become operative or
effective if, in the opinion of the Special Warrant Agent, based on the
advice of its Counsel, such amendment or relief impairs any of the rights
of the Special Warrantholders as a group or of the Special Warrant Agent,
and provided further that the Special Warrant Agent may in its sole
discretion decline to enter into any such supplemental indenture which in
its opinion, based on the advice of its counsel, may not afford adequate
protection to the Special Warrant Agent when the same shall become
operative;
(f) for any other purpose not inconsistent with the terms of this Indenture,
including the correction or rectification of any ambiguities, defective or
inconsistent provisions, errors or omission herein, provided that, in the
opinion of the Special Warrant Agent, based on the advice of its Counsel,
the rights of the Special Warrant Agent and of the Special Warrantholders
as a group are not prejudiced thereby; and
(g) amending the type or number of Subject Securities or other securities of
the Corporation issuable upon exercise of the Special Warrants as
contemplated by Sections 2.14 and 2.15 hereof.
7.2 SUCCESSOR CORPORATIONS
In the case of the consolidation, amalgamation, arrangement, merger or
transfer of the undertaking or assets of the Issuers as an entirety or
substantially as an entirety to another corporation (a "SUCCESSOR CORPORATION"),
forthwith following the occurrence of such event the successor corporation
resulting from such consolidation, amalgamation, arrangement, merger or transfer
(if not the Corporation) shall expressly assume, by supplemental indenture
satisfactory in form to Counsel to the Special Warrant Agent and executed and
delivered to the Special Warrant Agent, the due and punctual performance and
observance of each and every covenant and condition of this Indenture to be
performed and observed by the Issuers.
ARTICLE 8 - CONCERNING THE SPECIAL WARRANT AGENT
8.1 TRUST INDENTURE LEGISLATION
(a) In this Article, the term "APPLICABLE LEGISLATION" means the provisions of
any statute of Canada or a province thereof and of regulations under any
such named or other statute relating to trust indentures and/or to the
rights, duties and obligations of warrant agents and of corporations under
trust indentures, to the extent that such provisions are at the time in
force and applicable to this Indenture.
(b) If and to the extent that any provision of this Indenture limits, qualifies
or conflicts with a mandatory requirement of Applicable Legislation, such
mandatory requirement shall prevail.
30.
(c) The Issuers and the Special Warrant Agent agree that each will at all times
in relation to this Indenture and any action to be taken hereunder observe
and comply with and be entitled to the benefit of Applicable Legislation.
8.2 RIGHTS AND DUTIES OF SPECIAL WARRANT AGENT
(a) In the exercise of the rights and duties prescribed or conferred by the
terms of this Indenture, the Special Warrant Agent shall act honestly and
in good faith with a view to the best interests of the Special
Warrantholders as a group and shall exercise the degree of care, diligence
and skill that a reasonably prudent warrant Agent would exercise in
comparable circumstances. No provision of this Indenture shall be construed
to relieve the Special Warrant Agent from or require any other person to
indemnify the Special Warrant Agent against liability for its own
negligence, wilful misconduct or bad faith.
(b) Subject only to subsection (a) of this Section 8.2, the Special Warrant
Agent shall not be bound to do or take any act, action or proceeding for
the enforcement of any of the obligations of the Issuers under this
Indenture unless and until it shall have received a Special Warrantholders'
Request specifying the act, action or proceeding which the Special Warrant
Agent is requested to take. The obligation of the Special Warrant Agent to
commence or continue any act, action or proceeding for the purpose of
enforcing any rights of the Special Warrant Agent or the Special
Warrantholders hereunder shall be conditional upon the Special
Warrantholders furnishing, when required by notice in writing by the
Special Warrant Agent, sufficient funds to commence or continue such act,
action or proceeding and an indemnity reasonably satisfactory to the
Special Warrant Agent and its officers, directors, employees and agents to
protect and hold harmless the Special Warrant Agent and its officers,
directors, employees and agents against the costs, charges, expenses and
liabilities to be incurred thereby and any loss and damage it may suffer by
reason thereof. None of the provisions contained in this Indenture shall
require the Special Warrant Agent 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 and
funded as aforesaid.
(c) The Special Warrant Agent may, before commencing or at any time during the
continuance of any such act, action or proceeding, require the Special
Warrantholders at whose instance it is acting to deposit with the Special
Warrant Agent the Special Warrants held by them, for which Special Warrants
the Special Warrant Agent shall issue receipts.
(d) Every provision of this Indenture that by its terms relieves the Special
Warrant Agent of liability or entitles it to act and rely upon any evidence
submitted to it is subject to the provisions of Applicable Legislation, and
to the provisions of this Section 8.2 and of Section 8.3.
(e) The Special Warrant Agent shall retain the right not to act and shall not
be held liable for refusing to act unless it has received clear and
reasonable documentation which complies
31.
with the terms of this Indenture. Such documentation must not require the
exercise of any discretion or independent judgment. In the event that the
Special Warrant Agent refuses to act because any documentation received by
it is not clear and reasonable, the Special Warrant Agent shall immediately
provide notice to the party who provided such documentation advising such
party of the Special Warrant Agent's refusal to act together with a brief
explanation of the reason for its refusal.
(f) In the event of any disagreement arising regarding the terms of this
Indenture, the Special Warrant Agent shall be entitled, at its option, to
refuse to comply with any or all demands whatsoever until the dispute is
settled either by agreement amongst the various parties or by a court of
competent jurisdiction.
(g) The Special Warrant Agent 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 Special Warrant Agent be required to take
notice of any default hereunder, unless and until notified in writing of
such default, which notice shall distinctly specify such default and in the
absence of any such notice the Special Warrant Agent 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 to the Special Warrant Agent to
determine whether or not the Special Warrant Agent shall take action with
respect to any default.
8.3 EVIDENCE, EXPERTS AND ADVISERS
(a) In addition to the reports, certificates, opinions and other evidence
required by this Indenture, the Issuers shall furnish to the Special
Warrant Agent such additional evidence of compliance with any provision
hereof in such form as may be prescribed by Applicable Legislation, or as
the Special Warrant Agent may reasonably require by written notice to the
Issuers.
(b) In the exercise of its rights and duties hereunder, the Special Warrant
Agent may, if it is acting in good faith, rely as to the truth of the
statements and the accuracy of the opinions expressed therein, upon
statutory declarations, opinions, reports, written requests, consents,
orders of the Issuers, certificates of the Issuers or other evidence
furnished to the Special Warrant Agent, provided that such evidence
complies with Applicable Legislation.
(c) Whenever Applicable Legislation requires that evidence referred to in
subsection (a) of this Section 8.3 be in the form of a statutory
declaration, the Special Warrant Agent may accept such statutory
declaration in lieu of a certificate of the Corporation required by any
provision
32.
hereof. Any such statutory declaration may be made by one or more
of the chairman, president, vice-president, secretary or treasurer of the
Issuers.
(d) The Special Warrant Agent may act and rely and shall be protected in acting
and relying upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, letter, telegram,
cablegram or other paper or document believed by it to be genuine and to
have been signed, sent, or presented by or on behalf of the proper party or
parties.
(e) Proof of the execution of an instrument in writing, including a Special
Warrantholders' Request, by any Special Warrantholder may be made by the
certificate of a notary public, or other officer with similar powers, that
the person signing such instrument acknowledged to him the execution
thereof, or by an affidavit of a witness to such execution or in any other
manner which the Special Warrant Agent may consider adequate and in respect
of a corporate Special Warrantholder shall include a certificate of
incumbency of such Special Warrantholder together with a certified copy of
a resolution authorizing the person who signed such instrument to sign such
instrument.
(f) The Special Warrant Agent may employ or retain such counsel, accountants or
other experts or advisers as it may reasonably require for the purpose of
discharging its duties hereunder, may act on and rely upon the advice or
opinion so obtained and may pay reasonable remuneration for all services so
performed by any of them, without taxation of costs of any counsel, and
shall not be responsible for any misconduct on the part of any of them. The
cost of such services shall be added to and be part of the Special Warrant
Agent's fees hereunder.
8.4 DOCUMENTS, MONIES, ETC. HELD BY SPECIAL WARRANT AGENT
Any securities, documents of title or other instruments that may at any
time be held by the Special Warrant Agent subject to the trusts hereof may be
placed in the deposit vaults of the Special Warrant Agent or of any Canadian
chartered bank or trust company or deposited for safekeeping with any such bank
or trust company.
8.5 ACTION BY SPECIAL WARRANT AGENT TO PROTECT INTERESTS
Subject to the provisions of this Indenture and Applicable Legislation, the
Special Warrant Agent shall have the power to institute and to maintain such
action and proceedings as it may consider necessary or expedient to preserve,
protect or enforce its interests and the interests of the Special
Warrantholders.
8.6 SPECIAL WARRANT AGENT NOT REQUIRED TO GIVE SECURITY
33.
The Special Warrant Agent 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.
8.7 PROTECTION OF SPECIAL WARRANT AGENT
By way of supplement to the provisions of any law for the time being
relating to warrant agents, it is expressly declared and agreed as follows:
(a) The Special Warrant Agent shall not be liable for or by reason of any
statements of fact or recitals in this Indenture or in the Special Warrants
(except the representation contained in Sections 8.9 and 8.12 or in the
certificate of the Special Warrant Agent on the Special Warrants) or be
required to verify the same.
(b) Nothing herein contained shall impose any obligation on the Special Warrant
Agent to see to or to require evidence of the registration or filing (or
renewal thereof) of this Indenture or any instrument ancillary or
supplemental hereto.
(c) The Special Warrant Agent shall not be bound to give notice to any person
of the execution hereof.
(d) The Special Warrant Agent shall not incur any liability or responsibility
whatsoever or be in any way responsible for the consequence of any breach
on the part of the Corporation of any of the covenants herein contained or
of any acts of any directors, officers, employees, agents or servants of
the Corporation.
(e) The Issuers hereby jointly and severally indemnify and saves harmless the
Special Warrant Agent and its officers, directors, employees and agents
from and against any and all liabilities, losses, costs, claims, action or
demands whatsoever which may be brought against the Special Warrant Agent
or which it may suffer or incur as a result or arising out of the
performance of its duties and obligations under this Indenture, save only
in the event of negligence or wilful misconduct of the Special Warrant
Agent or any of its officers, directors and employees. It is understood and
agreed that this indemnification shall survive the termination of this
Indenture or the resignation or removal of the Special Warrant Agent.
8.8 REPLACEMENT OF SPECIAL WARRANT AGENT
(a) The Special Warrant Agent may resign its trust and be discharged from all
further duties and liabilities hereunder by giving to the Issuers not less
than 45 days' prior notice in writing or such shorter prior notice as the
Issuers may accept as sufficient. The Special Warrantholders by
extraordinary resolution shall have the power at any time to remove the
existing Special Warrant Agent and to appoint a new warrant agent. In the
event of the Special Warrant Agent resigning or being removed as aforesaid
or being dissolved, becoming bankrupt, going into liquidation or otherwise
becoming incapable of acting hereunder, the Issuers shall forthwith appoint
a new warrant agent unless a new warrant agent has already been appointed
by the
34.
Special Warrantholders; failing such appointment by the Issuers, the
retiring Special Warrant Agent or any Special Warrantholder may apply to a
justice of the Ontario Court of Justice (General Division) at the Issuers'
expense, on such notice as such justice may direct, for the appointment of
a new warrant agent; but any new warrant Agent so appointed by the Issuers
or by the Court shall be subject to removal as aforesaid by the Special
Warrantholders. Any new warrant agent appointed under any provision of this
Section 8.8 shall be a corporation authorized to carry on the business of a
trust company in the Province of Ontario and, if required by Applicable
Legislation of any other province, in such other province. On any such
appointment the new warrant agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named
herein as Special Warrant Agent without any further assurance, conveyance,
act or deed; but there shall be immediately executed, at the expense of the
Issuers, all such conveyances or other instruments as may, in the opinion
of counsel, be necessary or advisable for the purpose of assuring the same
to the new warrant agent, provided that any resignation or removal of the
Special Warrant Agent and appointment of a successor warrant Agent shall
not become effective until the successor warrant agent shall have executed
an appropriate instrument accepting such appointment and, at the request of
the Issuers, the predecessor Special Warrant Agent, upon payment of its
outstanding remuneration and expenses, shall execute and deliver to the
successor warrant agent an appropriate instrument transferring to such
successor warrant agent all rights and powers of the Special Warrant Agent
hereunder and all securities, documents of title and other instruments, and
all monies and properties, held by the Special Warrant Agent hereunder.
(b) Upon the appointment of a successor warrant agent, the Issuers shall
promptly notify the Special Warrantholders thereof in the manner provided
for in Section 10.2.
(c) Any corporation into or with which the Special Warrant Agent may be merged
or consolidated or amalgamated, or any corporation succeeding to the trust
business of the Special Warrant Agent, shall be the successor to the
Special Warrant Agent hereunder without any further act on its part or of
any of the parties hereto, provided that such corporation would be eligible
for appointment as a new warrant agent under subsection (a) of this Section
8.8.
(d) Any Special Warrants certified but not delivered by a predecessor warrant
agent may be certified by the successor warrant agent in the name of the
predecessor or successor warrant agent.
8.9 CONFLICT OF INTEREST
(a) The Special Warrant Agent represents to the Issuers that at the time of
execution and delivery hereof no material conflict of interest exists in
the Special Warrant Agent's role as a fiduciary hereunder and agrees that
in the event of a material conflict of interest arising hereafter it will,
within 90 days after ascertaining that it has such a material conflict of
interest, either eliminate the same or resign its trust hereunder to a
successor warrant agent approved by the
35.
Issuers. If any such material conflict of interest exists or hereafter
shall exist, the validity and enforceability of this Indenture and the
Special Warrants shall not be affected in any manner whatsoever by reason
thereof.
(b) Subject to subsection (a) of this Section 8.9, the Special Warrant Agent,
in its personal or any other capacity, may buy, lend upon and deal in
securities of the Corporation and generally may contract and enter into
financial transactions with the Corporation or any subsidiary of the
Corporation without being liable to account for any profit made thereby.
8.10 ACCEPTANCE OF TRUSTS
The Special Warrant Agent xxxxxx accepts the trusts in this Indenture
declared and provided for and agrees to perform the same upon the terms and
conditions herein set forth.
8.11 SPECIAL WARRANT AGENT NOT TO BE APPOINTED RECEIVER
The Special Warrant Agent and any person related to the Special Warrant
Agent shall not be appointed a receiver or receiver and manager or liquidator of
all or any part of the assets or undertaking of the Issuers.
8.12 AUTHORIZATION TO CARRY ON BUSINESS
The Special Warrant Agent represents to the Issuers that it is duly
authorized and qualified to carry on the business of a trust company in each of
the provinces of Canada.
8.13 LIABILITY OF SPECIAL WARRANT AGENT
The Special Warrant Agent shall not be liable or accountable for any loss
or damage whatsoever to any person caused by the performance or failure to
perform by it of its responsibilities under this agreement save only to the
extent that such loss or damage is attributable to the negligence, fraud or
wilful misconduct of the Special Warrant Agent.
ARTICLE 9 - FORM OF SPECIAL WARRANT
9.1 FORM OF SPECIAL WARRANT CERTIFICATE
PSW - 0 or
SSW - 0
SPECIAL WARRANT CERTIFICATE
XXX.XXX INTERNATIONAL INC.
(the "Corporation")
(Constituted pursuant to the laws of the Province of Ontario, Canada)
36.
NO. ____________
__________________ SPECIAL WARRANTS
(each entitling the holder to
subscribe for one Common Share and
one-half a Share Purchase Warrant
for no additional consideration)
THIS IS TO CERTIFY that, for value received, ___________________ (the
"holder") is entitled to acquire, in the manner herein provided, subject to the
restrictions contained in the Indenture hereinafter referred to, at any time and
from time to time on or prior to 5:00 p.m. Toronto time (the "Expiry Time"), on
the date (the "Expiry Date") that is the earlier of:
1. the date which is five (5) Business Days following the date of the issuance
of a receipt by the last of the securities regulatory authorities in the
Qualifying Jurisdictions for a Prospectus; and
2. August 4, 1999;
one unit ("Unit") comprised of one common share of the Corporation ("Common
Share") (or, in the circumstances described below, acquire one and one seven-
hundredth (1.07) Common Shares and one-half a warrant ("Share Purchase Warrant")
(or in the circumstances described below, acquire 0.535 Share Purchase Warrants)
for each Special Warrant represented by this certificate without payment of any
consideration in addition to the subscription price for such Special Warrant.
The Special Warrants represented by this certificate are issued under and
pursuant to a Special Warrant Indenture (the "Indenture") dated as of August 4,
1998 between the Issuers and CIBC Mellon Trust Company (the "Special Warrant
Agent") (which expression shall include any successor warrant agent appointed
under the Indenture), to which Indenture (and any amendments thereto and
instruments supplemental thereto) reference is hereby made for a full
description of the rights of the holders of the Special Warrants and the terms
and conditions upon which such Special Warrants are or are to be, issued and
held, all to the same effect as if the provisions of the Indenture and all
amendments thereto and instruments supplemental thereto were herein set forth
and to all of which provisions the holder of these Special Warrants by
acceptance hereof assents. All capitalized terms not otherwise defined herein
shall have the meanings ascribed thereto in the Indenture.
In the event of any conflict or inconsistency between the provisions of the
Indenture (and any amendments thereto and instruments supplemental thereto) and
the provisions of this Special Warrant Certificate, except those that are
necessary by context, the provisions of the Indenture (and any amendments
thereto and instruments supplemental thereto) shall prevail. The terms and
provisions of the Indenture (and any amendments thereto and instruments
supplemental thereto) are incorporated herein by reference.
37.
Such right to exercise Special Warrants for the Common Shares and Share
Purchase Warrants may be effected by the holder hereof by:
(a) duly completing in the manner indicated and executing the Exercise
Form attached hereto; and
(b) surrendering this Special Warrant Certificate to the Special Warrant
Agent as hereinafter set forth,
provided that any Special Warrant not so exercised on or before the Expiry Time
shall be deemed to have been exercised by the holder immediately prior thereto.
This Special Warrant Certificate shall be validly surrendered only upon
delivery thereof or by mailing the same to the Special Warrant Agent at its
principal office in the City of Toronto, Ontario. The Exercise Form attached
hereto shall not be deemed to be duly completed if the name and mailing address
of the holder do not appear legibly on such Exercise Form or such Exercise Form
is not signed by the holder.
In the case of a Special Warrant which is exercised by a holder in
accordance with the provisions of Subsection 3.1(c) of the Indenture, within
five (5) Business Days after the Exercise Date of such Special Warrant, the
Special Warrant Agent shall:
(a) cause to be mailed to the person in whose name the Common Shares and
Share Purchase Warrants issuable upon the exercise of the exercise
rights of the Special Warrants are to be issued, as specified in the
Special Warrant, at the address specified therein;
(b) if so specified therein, cause to be delivered to such person at the
office of the Special Warrant Agent where such Special Warrant was
surrendered; or
(c) if no specification as contemplated by (a) or (b) is provided, cause
to be mailed to the person in whose name the Common Shares and Share
Purchase Warrants are to be issued at the address of such person last
appearing on the register maintained by the Special Warrant Agent
pursuant to the Indenture or as such person may otherwise notify the
Special Warrant Agent in writing on or prior to the Exercise Date,
a certificate or certificates for the Common Shares and Share Purchase Warrants
to which the holder is entitled.
In the case of a Special Warrant which is deemed exercised in accordance
with the provisions of Subsection 3.1(b) of the Indenture, within five (5)
Business Days after the Exercise Date of such Special Warrants, the Issuers
shall without any further act on the part of the Special Warrantholder, cause to
be mailed to the Special Warrantholder at the address of such person last
appearing on the register of Special Warrants maintained by the Special Warrant
Agent pursuant to the Indenture or as such person may otherwise instruct the
Special Warrant Agent in writing on or prior to the
38.
mailing a certificate or certificates for the Common Shares and Share Purchase
Warrants to which the Special Warrantholder is entitled.
Upon due exercise or deemed exercise of the Special Warrants as provided
herein, the person or persons in whose name or names the Common Shares and Share
Purchase Warrants are issuable, shall be deemed for all purposes (except as
provided in the Indenture hereinafter referred to) to be the holder or holders
of record of such Common Shares and Share Purchase Warrants and the Issuers
covenant that they will (subject to and in accordance with the provisions of the
aforesaid Indenture) cause a certificate or certificates representing such
Common Shares and Share Purchase Warrants to be delivered or mailed to such
person or persons at the address or addresses specified in such Exercise Form or
on the register of Special Warrants maintained by the Special Warrant Agent (if
deemed to have been exercised).
No fractional Common Shares or Share Purchase Warrants will be issued. To
the extent that the holder of a Special Warrant is entitled to receive on the
exercise or partial exercise thereof a fraction of a Common Share or Share
Purchase Warrants, the Issuers shall make a cash payment equal to the fair value
of the fraction not so issued as determined by the directors of the Corporation
in their sole discretion. No cheque shall be issued or cash payment made to any
Special Warrantholder for an amount less than $5.00.
The Indenture provides for adjustments to the subscription rights attaching
to these Special Warrants in certain events and also provides for the giving of
notice by the Issuers prior to taking certain actions specified therein.
The holding of the Special Warrants evidenced by this Special Warrant
Certificate shall not constitute the holder hereof a shareholder of the
Corporation or entitle such holder to any right or interest in respect thereof
except as herein and in the Indenture expressly provided.
The Special Warrants evidenced by this Special Warrant Certificate are not
transferable except as set forth in Subsection 2.9(b) of the Indenture which
makes reference to the fact that no transfer of a Special Warrant shall be valid
unless made by the holder or his executors, administrators or other legal
representatives, or his or her attorney duly appointed by an instrument in
writing in form and manner satisfactory to the Agent, acting reasonably, with
signatures guaranteed by a Canadian chartered bank, a Canadian trust company, a
member of any Canadian stock exchange or such other guarantor as the Special
Warrant Agent determines to be acceptable and upon compliance with such other
reasonable requirements as the Special Warrant Agent may prescribe. Upon
compliance with these transfer requirements, and with applicable securities
legislation and requirements of regulatory authorities, the transferee shall
become noted upon the register of holders.
If any of the Common Shares and Share Purchase Warrants in respect of which
the Special Warrants are exercised are to be issued to a person or persons other
than the holder (as aforesaid), the holder shall pay to the Special Warrant
Agent all requisite stamp transfer taxes or other governmental charges exigible
in connection with the issue of such Common Shares and Share
39.
Purchase Warrants to such other person or persons or shall establish to the
satisfaction of the Special Warrant Agent that such taxes and charges have been
paid.
This Special Warrant Certificate shall not be valid for any purpose
whatever unless and until it has been countersigned by or on behalf of the
Special Warrant Agent.
Time shall be of the essence hereof. The Special Warrants and the
Indenture (and any amendments thereto and instruments supplemental thereto)
shall be governed by, performed, construed and enforced 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.
The Corporation has covenanted and agreed to use its reasonable commercial
efforts to promptly finalize and obtain a receipt for a preliminary prospectus
and a final Prospectus in the Qualifying Jurisdictions qualifying the issuance
of the Common Shares and Share Purchase Warrants issuable upon the due exercise
or deemed exercise of the Special Warrants.
IN THE EVENT THE CORPORATION FAILS TO OBTAIN A RECEIPT FOR THE FINAL
PROSPECTUS FROM THE SECURITIES ADMINISTRATORS IN EACH OF THE QUALIFYING
JURISDICTIONS ON OR PRIOR TO 5:00 P.M. (TORONTO TIME) ON NOVEMBER 2, 1998, (A
"QUALIFICATION DEFAULT") THEN EACH SPECIAL WARRANT SHALL ENTITLE THE HOLDER TO
ACQUIRE ONE AND ONE SEVEN-HUNDREDTH (1.07) UNITS (IN LIEU OF ONE (1) UNIT),
WITHOUT PAYMENT OF FURTHER CONSIDERATION, ON EXERCISE OR DEEMED EXERCISE OF SUCH
SPECIAL WARRANT.
IN THE EVENT OF A QUALIFICATION DEFAULT, THE HOLDER IS ENTITLED TO RETRACT
UP TO 75% OF THE SPECIAL WARRANTS REPRESENTED BY THIS CERTIFICATE BY COMPLETING
AND FORWARDING A NOTICE OF RETRACTION IN THE FORM ATTACHED AS SCHEDULE "C"
HERETO AND SUBMITTING THE SAME TOGETHER WITH THIS CERTIFICATE TO THE SPECIAL
WARRANT AGENT AT ITS PRINCIPAL OFFICE IN TORONTO, ONTARIO AS SOON AS PRACTICABLE
AFTER RECEIPT FROM THE SPECIAL WARRANT AGENT OF NOTIFICATION OF SUCH
QUALIFICATION DEFAULT BUT IN ANY EVENT NOT LATER THAN 5:00 P.M. (TORONTO TIME)
ON THE FIFTH BUSINESS DAY FOLLOWING THE DATE OF THE QUALIFICATION DEFAULT (THE
"RETRACTION DEADLINE"). UPON RECEIPT BY THE SPECIAL WARRANT AGENT OF THE ESCROW
AGENT'S CHEQUE PAYABLE TO THE HOLDER, THE SPECIAL WARRANT AGENT SHALL REMIT TO
THE HOLDER WITHIN 3 BUSINESS DAYS OF RECEIPT OF THIS CERTIFICATE AND THE
HOLDER'S NOTICE OF RETRACTION, A CHEQUE IN THE AMOUNT OF THE PURCHASE PRICE OF
THE SPECIAL WARRANTS BEING RETRACTED PLUS ANY ACCRUED INTEREST TOGETHER WITH A
NEW CERTIFICATE REPRESENTING THOSE OF THE HOLDER'S SPECIAL WARRANTS WHICH HAVE
NOT BEEN RETRACTED.
FURTHERMORE, IN THE EVENT THAT A RECEIPT FOR A FINAL PROSPECTUS RELATING TO
THE DISTRIBUTION OF THE COMMON SHARES AND SHARE PURCHASE WARRANTS IS NOT
OBTAINED FROM THE SECURITIES ADMINISTRATORS IN ANY OF THE QUALIFYING
JURISDICTIONS, THE COMMON SHARES AND SHARE PURCHASE WARRANTS MAY BE SUBJECT TO
STATUTORY HOLD PERIODS DURING WHICH TIME THESE SECURITIES MAY NOT BE RESOLD IN
SUCH PROVINCES EXCEPT PURSUANT TO APPLICABLE PROSPECTUS AND REGISTRATION
EXEMPTIONS. IN ADDITION, ANY SPECIAL WARRANTS THAT ARE EXERCISED OR COMMON
SHARES AND SHARE PURCHASE WARRANTS RECEIVED ON SUCH EXERCISE PRIOR TO THE
ISSUANCE OF A RECEIPT FOR THE FINAL PROSPECTUS BY THE SECURITIES ADMINISTRATORS
IN THE QUALIFYING
40.
JURISDICTIONS MAY BE SUBJECT TO STATUTORY RESTRICTIONS. HOLDERS ARE ADVISED TO
CONSULT THEIR LEGAL ADVISORS IN THIS REGARD.
IN WITNESS WHEREOF the Issuers have caused this Special Warrant Certificate
to be signed by its duly authorized officer as of August 4, 1998.
XXX.XXX INTERNATIONAL INC.
Per:_______________________________c/s
Authorized Signing Officer
1184041 ONTARIO INC.
Per:_______________________________c/s
Authorized Signing Officer
XXXXXX GROUP COMPANY
Per:_______________________________c/s
Authorized Signing Officer
Countersigned by:
CIBC MELLON TRUST COMPANY
Per: ____________________________
Authorized Signing Officer
41.
TRANSFER FORM
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
(Please print or typewrite name and address of assignee)
______________________________ Special Warrant(s) represented by the within
certificate, and do(es) hereby irrevocably constitute and
appoint
______________________________ the attorney of the undersigned to transfer the
said Special Warrant(s) on the register of Special Warrants maintained by the
Special Warrant Agent with full power of substitution hereunder.
DATED this ________ day of _______________ , 199_________.
______________________________
Signature of Special Warrantholder
___________________ _______________________________________
Signature Guarantee Name of Special Warrantholder (please print)
The signature of the Special Warrantholder to this assignment must
correspond exactly with the name of the Special Warrantholder as set forth on
the face of this Special Warrant certificate in every particular, without
alteration or enlargement or any change whatsoever and the signature must be
guaranteed by a Canadian chartered bank or by a trust company or by a member
firm of any Canadian stock exchange, any of whose signature must be on file with
the Special Warrant Agent.
42.
EXERCISE OF EXCHANGE RIGHTS INSTRUCTIONS TO SPECIAL WARRANTHOLDER
The registered holder hereof may exercise his right to exercise Special
Warrants for Common Shares and Share Purchase Warrants of XXX.XXX INTERNATIONAL
INC. (the "Corporation"), subject to the adjustments described in the Special
Warrant Indenture by completing the Exercise Form and surrendering this Special
Warrant certificate and the duly completed Exercise Form to CIBC Mellon Trust
Company by delivering or mailing it to CIBC Mellon Trust Company at the
following office:
By courier or by hand:
Special projects
000 Xxx Xxxxxx
Xxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Courier Window
By mail:
P.O. Box 0000
Xxxxxxxx Xxxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
UPON EXERCISE, THE SPECIAL WARRANTS WILL BE CANCELLED AND BECOME ABSOLUTELY
VOID AND ALTERNATIVELY, IF NOT EXERCISED ON OR PRIOR TO 5:00 P.M., TORONTO TIME,
ON THE EXPIRY DATE WILL BE DEEMED TO HAVE BEEN EXERCISED IN FULL BY SUCH HOLDER
IMMEDIATELY PRIOR TO THAT TIME.
For your own protection, it is suggested that all documentation be
forwarded to the Special Warrant Agent by registered mail.
43.
EXERCISE FORM
TO: XXX.XXX INTERNATIONAL INC.
The undersigned hereby exercises the right to exercise _________ Special
Warrants for ________ Common Shares and __________ Share Purchase Warrants of
XXX.XXX INTERNATIONAL INC. (or such number of other securities or property to
which such Special Warrants entitle the undersigned in lieu thereof or in
addition thereto under the provisions of the Indenture mentioned in the within
Special Warrant Certificate) according to the terms of the Indenture mentioned
in the within Special Warrant Certificate. If any of the Common Shares and
Share Purchase Warrants are to be issued to a person or persons other than the
holder in those circumstances as set forth in the within Special Warrant
Certificate, the holder must pay to CIBC Mellon Trust Company all requisite
stamp or security transfer taxes or other governmental charges related thereto.
(Print clearly)
Name:
Address in Full:
Number of Special Warrants being Exercised:
DATED this day of , 199_____.
__________________________________
Signature of Special Warrantholder
________________________________
Name of Special Warrantholder
(As registered on Special Warrant Certificate)
________________________________
________________________________
________________________________
Print Full Address
44.
SCHEDULE "B"
NOTICE TO SPECIAL WARRANTHOLDERS
Reference is made to the Special Warrant Indenture made as of August 4,
1998 (the "Special Warrant Indenture") between the Issuers and CIBC Mellon Trust
Company. Unless defined herein, capitalized terms used herein have the
respective meanings ascribed to them in the Special Warrant Indenture.
We hereby confirm that receipts have been issued by the securities
commissions in each of the Qualifying Jurisdictions in respect of the prospectus
qualifying the distribution of the Common Shares and Share Purchase Warrants
issuable upon exercise of the Special Warrants. The last receipt was issued on
__________________________ by the ______________________ Securities Commission.
The Expiry Time is therefore 5:00 p.m. (Toronto Time) on ______________.
A copy of the prospectus is enclosed herewith.
45.
SCHEDULE "C"
NOTICE OF RETRACTION OF SPECIAL WARRANTS
TO: XXX.XXX INTERNATIONAL INC.
The undersigned hereby exercises the right to retract _________________
Special Warrants (not to exceed 75% of the Special Warrants represented by the
within certificate) of XXX.XXX INTERNATIONAL INC. according to the terms of the
Indenture mentioned in the within Special Warrant Certificate. The undersigned
hereby requests payment of the sum of $1.40 for each Special Warrant being
retracted plus any accrued interest thereon. The undersigned further surrenders
herewith the written Special Warrant Certificate and requests the issue and
delivery of a new certificate representing those of the holder's Special
Warrants which have not been retracted.
Number of Special Warrants being retracted: __________________________________
DATED this day of 1998.
____________________________________
Signature of Special Warrantholder
____________________________________
Name of Special Warrantholder
(As registered on Special
Warrant Certificate)
____________________________________
____________________________________
____________________________________
Print Full Address
____________________________________
Telephone No. (day time)
46.
ARTICLE 10 - GENERAL
10.1 NOTICE TO THE ISSUERS AND THE SPECIAL WARRANT AGENT
(i) Unless herein otherwise expressly provided, any notice to be given
hereunder to the Issuers or the Special Warrant Agent shall be deemed
to be validly given if delivered or if sent by registered letter,
postage prepaid, or if sent by facsimile transmission, telex or other
means of prepaid transmission or recorded communication:
(A) if to the Corporation
XXX.XXX INTERNATIONAL INC.
0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxx
X0X 0X0
Facsimile: (000) 000-0000
if to the Special Warrant Agent:
(B) CIBC MELLON TRUST COMPANY
000 Xxx Xxxxxx, Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Facsimile: 000-000-0000
Attention: Assistant Vice-President, Client Services
(C) if to the Sellers:
1184041 ONTARIO INC.
c/o 0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxx
X0X 0X0
Facsimile: (000) 000-0000
XXXXXX GROUP COMPANY
c/o 0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxx
X0X 0X0
Facsimile: (000) 000-0000
47.
XXX.XXX INTERNATIONAL INC.
0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxx
X0X 0X0
Facsimile: (000) 000-0000
(D) if to the Escrow Agent:
XXXXXXXXX XXXX XXXXXXX APPS & DELLELCE
Barristers and Solicitors
Suite 810
P.O. Box 0
Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Facsimile: 000-000-0000
Attention: Xxxx Xxxxxxxxx
and any such notice if delivered in accordance with the foregoing shall be
deemed to have been received on the of delivery if that date is a Business Day
or the Business Day following the date of delivery if such date is not a
Business Day or, if mailed, on the fifth Business Day following the date of
deposit in the mail, or if sent by facsimile transmission, on the date of such
facsimile transmission if that date is a Business Day or the Business Day
following the date of sending if such date is not a Business Day or if sent
after normal business hours.
(ii) The Issuers or the Special Warrant Agent, as the case may be, may from
time to time notify the other in the manner provided in subsection
10.1(i) 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
Issuers or the Special Warrant Agent, as the case may be, for all
purposes of this Indenture. A copy of any notice of change of address
given pursuant to this subsection 10.1(ii) shall be available for
inspection at the Corporation's office by Special Warrantholders
during normal business hours.
10.2 NOTICE TO THE SPECIAL WARRANTHOLDERS
Any notice to the Special Warrantholders under the provisions of this
Indenture shall be deemed to be validly given if delivered, or if sent by
prepaid first class mail posted from within Canada in envelopes addressed to the
Special Warrantholders at their respective addresses appearing in the register
of holders maintained by the Special Warrant Agent. Any notice so delivered
shall be deemed to have been received on the date of delivery if that date is a
Business Day, or the Business Day following the date of delivery if such date is
not a Business Day, and if mailed shall be deemed to have been received on the
fifth Business Day following the date of deposit in the mail. Accidental error
or omission in giving notice or accidental failure to give notice to any Special
Warrantholder shall not invalidate any action or proceeding founded thereon.
48.
10.3 MAIL SERVICE INTERRUPTION
If by reason of any interruption of mail service, actual or
threatened, any notice to be given to the Special Warrant Agent, the Corporation
or the Special Warrantholders would reasonably be unlikely to reach its
destination in the ordinary course of mail, such notice shall be valid and
effective only if delivered to the party to which it is addressed or, in the
case of a notice to either the Corporation or the Special Warrant Agent, if sent
to such party, at the appropriate address in accordance with Section 10.1, by
facsimile transmission.
10.4 COUNTERPARTS AND FORMAL DATE
This Indenture may be 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 and notwithstanding their
date of execution shall be deemed to be dated as of the date appearing at the
top of this Indenture.
10.5 SATISFACTION AND DISCHARGE OF INDENTURE
Upon the date upon which all obligations of the Issuers under this
Special Warrant Indenture have been performed in full (including the obligation
to deliver Common Shares and certificates therefor), this Special Warrant
Indenture shall cease to be of further effect in respect of the Issuers. The
Special Warrant Agent, on written demand of and at the cost and expense of the
Issuers, and upon delivery to the Special Warrant Agent of a certificate of the
Corporation stating that all conditions precedent to the satisfaction and
discharge of this Special Warrant Indenture have been complied with and upon
payment by the Issuers to the Special Warrant Agent of the expenses, fees and
other remuneration payable to the Special Warrant Agent, shall execute proper
instruments acknowledging satisfaction of and discharging this Indenture;
provided that if the Special Warrant Agent has not then performed any of its
obligations hereunder any such satisfaction and discharge of the Issuers'
obligations hereunder shall not affect or diminish the rights of any Special
Warrantholder or the Corporation against the Special Warrant Agent.--
10.6 PROVISIONS OF INDENTURE AND SPECIAL WARRANTS FOR THE SOLE BENEFIT OF
PARTIES AND SPECIAL WARRANTHOLDERS
Except as provided in Sections 5.2 and 5.3, nothing in this Indenture
or the Special Warrants, express or implied, shall give or be construed to give
to any person other than the parties hereto, the Underwriter (in the case of
Sections 2.11 and 6.9) and the holders from time to time of the Special Warrants
any legal or equitable right, remedy or claim under this Indenture, or under any
covenant or provision herein contained, all such covenants and provisions being
for the sole benefit of the parties hereto and the Special Warrantholders.
49.
IN WITNESS WHEREOF the parties hereto have executed this Indenture
under the hands of their proper officers duly authorized in that behalf.
XXX.XXX INTERNATIONAL INC.
By:
CIBC MELLON TRUST COMPANY
By:
By:
1184041 ONTARIO INC.
By:
XXXXXX GROUP COMPANY
By:
