RIGHTS AGREEMENT
MARCH 29, 2006
BETWEEN
KINROSS GOLD CORPORATION
AND
COMPUTERSHARE INVESTOR SERVICES INC.
AS RIGHTS AGENT
RIGHTS AGREEMENT
TABLE OF CONTENTS
PAGE
ARTICLE I INTERPRETATION..........................................................................................2
1.1 CERTAIN DEFINITIONS....................................................................................2
1.2 HOLDER................................................................................................15
1.3 ACTING JOINTLY OR IN CONCERT..........................................................................15
1.4 APPLICATION OF STATUTES, REGULATIONS AND RULES........................................................15
1.5 CURRENCY..............................................................................................15
1.6 HEADINGS AND REFERENCES...............................................................................15
1.7 SINGULAR, PLURAL, ETC.................................................................................16
1.8 GENERALLY ACCEPTED ACCOUNTING PRINCIPLES..............................................................16
ARTICLE II THE RIGHTS............................................................................................16
2.1 LEGEND ON COMMON SHARE CERTIFICATES...................................................................16
2.2 INITIAL EXERCISE PRICE: EXERCISE OF RIGHTS: DETACHMENT OF RIGHTS....................................17
2.3 ADJUSTMENTS TO EXERCISE PRICE, NUMBER OF RIGHTS.......................................................20
2.4 DATE ON WHICH EXERCISE IS EFFECTIVE...................................................................25
2.5 EXECUTION, AUTHENTICATION, DELIVERY AND DATING OF RIGHTS CERTIFICATES.................................26
2.6 REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE...................................................26
2.7 MUTILATED, DESTROYED, LOST AND STOLEN RIGHTS CERTIFICATES.............................................27
2.8 PERSONS DEEMED OWNERS.................................................................................27
2.9 DELIVERY AND CANCELLATION OF CERTIFICATES.............................................................28
2.10 AGREEMENT OF RIGHTS HOLDERS...........................................................................28
ARTICLE III ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS.......................................29
3.1 FLIP-IN EVENT.........................................................................................29
ARTICLE IV THE RIGHTS AGENT......................................................................................30
4.1 GENERAL...............................................................................................30
4.2 MERGER OR AMALGAMATION OR CHANGE OF NAME OF RIGHTS AGENT..............................................31
4.3 DUTIES OF RIGHTS AGENT................................................................................32
4.4 CHANGE OF RIGHTS AGENT................................................................................33
ARTICLE V MISCELLANEOUS..........................................................................................34
5.1 REDEMPTION AND WAIVER.................................................................................34
5.2 EXPIRATION............................................................................................36
5.3 ISSUANCE OF NEW RIGHTS CERTIFICATES...................................................................36
5.4 SUPPLEMENTS AND AMENDMENTS............................................................................36
5.5 FRACTIONAL RIGHTS AND FRACTIONAL COMMON SHARES........................................................38
5.6 RIGHTS OF ACTION......................................................................................39
5.7 HOLDER OF RIGHTS NOT DEEMED A SHAREHOLDER.............................................................39
5.8 NOTICE OF PROPOSED ACTIONS............................................................................39
5.9 NOTICES...............................................................................................39
5.10 COSTS OF ENFORCEMENT..................................................................................41
5.11 SUCCESSORS............................................................................................41
5.12 BENEFITS OF THIS AGREEMENT............................................................................41
5.13 GOVERNING LAW.........................................................................................41
5.14 COUNTERPARTS..........................................................................................41
5.15 SEVERABILITY..........................................................................................41
5.16 DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS..................................................42
5.17 EFFECTIVE DATE........................................................................................42
5.18 APPROVAL OF HOLDERS OF RIGHTS.........................................................................42
5.19 DECLARATION AS TO NON-CANADIAN AND NON-UNITED STATES HOLDERS..........................................43
5.20 REGULATORY APPROVALS..................................................................................43
Exhibit "A" Form of Rights Certificate
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RIGHTS AGREEMENT
THIS AGREEMENT is made as of March 29, 2006.
B E T W E E N:
KINROSS GOLD CORPORATION, a corporation incorporated under the
BUSINESS CORPORATIONS ACT (Ontario)
(the "Corporation"),
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COMPUTERSHARE INVESTOR SERVICES INC., a company incorporated
under the laws of Canada, as rights agent
("Rights Agent")
WHEREAS the board of directors of the Corporation have determined that
it is advisable and in the best interests of the Corporation to adopt a
shareholder rights plan (the "Rights Plan");
AND WHEREAS in implementation of the Rights Plan, the board of directors
of the Corporation: (a) authorized and declared a distribution of one right
("Right") in respect of each Common Share (as hereinafter defined) outstanding
as of 5:30 p.m. (Toronto Time) on March 29, 2006 (the "Record Time") to each
holder of record of Common Shares at the Record Time; and (b) authorized the
issuance of one Right (subject to adjustment as hereinafter provided) in respect
of each Common Share issued after the Record Time and prior to the earlier of
the Separation Time and the Expiration Time (each as hereinafter defined);
AND WHEREAS, each Right entitles the holder thereof, after the
Separation Time, to purchase securities of the Corporation pursuant to the terms
and subject to the conditions set forth herein;
AND WHEREAS, the Rights Agent has agreed with the Corporation to act on
behalf of the Corporation in connection with the issuance, transfer, exchange
and replacement of Rights Certificates (as hereinafter defined), the exercise of
Rights and other matters referred to herein;
NOW, THEREFORE, in consideration of the premises and respective
agreements set forth herein, the parties hereby agree as follows:
ARTICLE I
INTERPRETATION
1.1 CERTAIN DEFINITIONS
In this Agreement, unless the context otherwise requires:
"ACQUIRING PERSON" means any Person who is the Beneficial Owner of 20%
or more of the outstanding Voting Shares; PROVIDED, HOWEVER, that the
term "Acquiring Person" shall not include:
(i) the Corporation or any Subsidiary of the Corporation, or
(ii) an underwriter or member of a banking or selling group that
acquires Voting Shares from the Corporation in connection with a
distribution by the Corporation to the public of securities, or
(iii) any Person who becomes the Beneficial Owner of 20% or more of
the outstanding Voting Shares solely as a result of one or any
combination of:
(A) a Voting Share Reduction;
(B) a Permitted Bid Acquisition;
(C) an Exempt Acquisition;
(D) a Pro-Rata Acquisition; or
(E) a Convertible Security Acquisition,
in each such case, until such time thereafter as such Person
shall become the Beneficial Owner (otherwise than pursuant to
any one or more of a Voting Share Reduction, a Permitted Bid
Acquisition, an Exempt Acquisition, a Pro-Rata Acquisition, or a
Convertible Security Acquisition) of additional Voting Shares
constituting more than 1% of the Voting Shares then outstanding,
in which event such Person shall become an Acquiring Person as
of the date and time of acquisition of such additional Voting
Shares; or
(iv) for a period of 10 days after the Disqualification Date (as
hereinafter defined), any Person who becomes the Beneficial
Owner of 20% or more of the outstanding Voting Shares as a
result of such Person becoming disqualified from relying on
clause (v) of the definition of Beneficial Owner. In this
definition, "DISQUALIFICATION DATE" means the first date of
public announcement of facts indicating that such Person has or
is making or has announced an intention to make a Take-over Bid
alone or by acting jointly or in concert with any other Person;
or
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(v) any Person (a "GRANDFATHERED PERSON") who is the Beneficial
Owner of 20% or more of the Voting Shares determined as at the
Record time, provided, however, that this exception shall not,
and shall cease to, apply if, after the Record Time the
Grandfathered Person: (A) ceases to own 20% or more of the
outstanding Voting Shares; or (B) becomes the Beneficial Owner
of more than 1% of the number of outstanding Voting Shares then
outstanding in addition to those Voting Shares such Person
already holds other than pursuant to a Voting Share Reduction, a
Permitted Bid Acquisition, an Exempt Acquisition, a Pro Rata
Acquisition, or a Convertible Security Acquisition or any
combination thereof.
"AFFILIATE", when used to indicate a relationship with a specified
Person, means a Person that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, such specified Person and a body corporate shall be deemed
to be an Affiliate of another body corporate if one of them is the
Subsidiary of the other or if both are Subsidiaries of the same body
corporate or if each of them is controlled by the same Person.
"ASSOCIATE", when used to indicate a relationship with a specified
Person, means (i) any corporation of which such specified Person
beneficially owns, directly or indirectly, voting securities carrying
more than 10% of the voting rights attached to all voting securities of
such corporation for the time being outstanding, (ii) any partner of
that specified Person, (iii) any trust or estate in which such specified
Person has a substantial beneficial interest or as to which such
specified Person serves as trustee or in a similar capacity; (iv) a
spouse of such specified Person, (v) any Person of either sex with whom
such specified Person is living in a conjugal relationship outside
marriage, or (vi) any relative of such specified Person or of a Person
mentioned in clauses (iv) or (v) of this definition if that relative has
the same residence as the specified Person.
A Person shall be deemed the "BENEFICIAL OWNER" and to have "BENEFICIAL
OWNERSHIP" of and to "BENEFICIALLY OWN":
(i) any securities of which such Person or any of such Person's
Affiliates or Associates is the owner at law or in equity;
(ii) any securities of which such Person or any of such Person's
Affiliates or Associates has the right to become the owner at
law or in equity within 60 days (where such right is exercisable
immediately or within a period of 60 days, whether or not upon
the condition or occurrence of any contingency or the making of
one or more payments) upon the exercise of any conversion right,
exchange right, share purchase right (other than the Rights) or
pursuant to any agreement, arrangement, pledge or understanding,
whether or not in writing, other than:
(A) customary agreements with and between underwriters and
banking group or selling group members with respect to a
distribution of securities; and
(B) pledges of securities in the ordinary course of the
pledgee's business; and
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(iii) any securities that are Beneficially Owned within the meaning of
clauses (i) or (ii) of this definition by any other Person with
which such Person is acting jointly or in concert, provided that
a Person shall not be deemed the "BENEFICIAL OWNER" of, or to
have "BENEFICIAL OWNERSHIP" of, or to "BENEFICIALLY OWN", any
security because:
(A) the holder of such security has agreed to deposit or
tender such security to a Take-over Bid made by such
Person or any of such Person's Affiliates or Associates
or any other Person referred to in clause (iii) of this
definition pursuant to a Permitted Lock-up Agreement; or
(B) such security has been deposited or tendered pursuant to
a Take-over Bid made by such Person or any of such
Person's Affiliates or Associates or made by any other
Person acting jointly or in concert with such Person
until such deposited or tendered security has been taken
up or paid for, whichever shall first occur;
(C) such Person, any Affiliate or Associate of such Person
or any other Person acting jointly or in concert with
such Person holds such security; provided that:
(i) the ordinary business of such Person (the "PORTFOLIO
MANAGER") includes the management or administration of
investment funds or mutual funds for other Persons and
such security is held by the Portfolio Manager in the
ordinary course of such business in the performance of
the Portfolio Manager's duties for the account of any
other Person (a "CLIENT") including non-discretionary
accounts held on behalf of a Client by a broker or
dealer or broker-dealer registered under applicable law;
(ii) such Person (the "TRUST COMPANY") is licensed to carry
on the business of a trust company under applicable law
and, as such, acts as trustee or administrator or in a
similar capacity in relation to the estates of deceased
or incompetent Persons (each, an "ESTATE ACCOUNT") or in
relation to other accounts (each, an "OTHER ACCOUNT")
and holds such security in the ordinary course of and
for the purposes of the activities of such Estate
Accounts or for such Other Accounts;
(iii) such Person (the "CROWN AGENT") is established by
statute for purposes that include, and the ordinary
business or activity of such Person includes, the
management of investment funds for employee benefit
plans, pension plans, insurance plans, or various public
bodies and the Crown Agent holds such security in the
ordinary course of and for the purposes of its
activities as such; or
(iv) such Person (the "PLAN ADMINISTRATOR") is the
administrator or the trustee of one or more pension
funds or plans registered under the laws of Canada or
the United States of America or any province or state
thereof (each, a
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"Plan") or is a Plan and such security is Beneficially
Owned or held by the Person in the ordinary course of
and for the purposes of its activities as such;
provided, however, that in any of the foregoing cases, the
Portfolio Manager, the Trust Company, the Crown Agent, the Plan
Administrator or the Plan, as the case may be, (i) did not
acquire and does not Beneficially Own or hold such security for
the purpose of or with the effect of changing or influencing the
control of the issuer thereof, either alone or acting jointly or
in concert with any other person, or in connection with or as a
participant in any transaction having that purpose or effect;
and (ii) is not then making or has not then announced an
intention to make a Take-over Bid, alone or by acting jointly or
in concert with any other Person, other than an Offer to Acquire
Voting Shares or other securities pursuant to a distribution by
the Corporation, a Permitted Bid or by means of ordinary market
transactions (including pre-arranged trades entered into in the
ordinary course of business of such Person) executed through the
facilities of a stock exchange or organized over-the-counter
market in respect of securities of the Corporation;
(D) such Person is a Client of the same Portfolio Manager as
another Person on whose account the Portfolio Manager
holds such security, or because such Person is an Estate
Account or an Other Account of the same Trust Company as
another Person on whose account the Trust Company holds
such security or because such Person is a Plan with the
same Plan Administrator as another Plan on whose account
the Plan Administrator holds such security;
(E) such Person is a Client of a Portfolio Manager and such
security is owned at law or in equity by the Portfolio
Manager or because such Person is an Estate Account or
an Other Account of a Trust Company and such security is
owned at law or in equity by the Trust Company or such
Person is a Plan and such security is owned at law or in
equity by the Plan Administrator of such Plan; or
(F) such Person is the registered holder of securities as a
result of carrying on the business, or acting as a
nominee, of a securities depositary.
For purposes of this Agreement, the percentage of Voting Shares
Beneficially Owned by any Person at any time shall be and be deemed to
be the product determined by the formula:
100 x A
-
B
where: A = the number of votes for the election of all directors
generally attached to the Voting Shares Beneficially
Owned by such Person at such time; and
B = the number of votes for the election of all directors
generally attaching to all Voting Shares actually
outstanding.
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Where any Person is deemed to Beneficially Own unissued Voting Shares,
such Voting Shares shall be deemed to be outstanding for the purpose of
calculating the percentage of Voting Shares Beneficially Owned by such
Person, but unissued Voting Shares which another Person may be deemed to
Beneficially Own shall not be included in the denominator of the above
formula.
"BOARD OF DIRECTORS" means the board of directors for the time being of
the Corporation.
"BUSINESS DAY" means any day other than a Saturday, Sunday or, unless
otherwise specified, a day on which Canadian chartered banks in Xxxxxxx,
Xxxxxxx, (or after the Separation Time, the principal office of the
Rights Agent in Toronto, Ontario) are generally authorized or obligated
by law to close.
"CANADIAN-U.S. EXCHANGE RATE" means, on any date, the inverse of the
U.S.-Canadian Exchange Rate.
"CANADIAN DOLLAR EQUIVALENT" of any amount which is expressed in United
States dollars means, on any date, the Canadian dollar equivalent of
such amount determined by reference to the Canadian-U.S. Exchange Rate
on such date.
"CLOSE OF BUSINESS" on any given date means 5:00 p.m. (Toronto time,
unless otherwise specified), on such date PROVIDED, HOWEVER, that if
such date is not a Business Day, "CLOSE OF BUSINESS" on such date shall
mean 5:00 p.m., (Toronto time, unless otherwise specified), on the next
succeeding Business Day.
"COMMON SHARES" means the common shares which the Corporation is
authorized to issue, as such shares may be subdivided, consolidated,
reclassified or otherwise changed from time to time, and "common shares"
when used with reference to any Person other than the Corporation means
the class or classes of shares (or similar equity interests) with the
greatest per share voting power entitled to vote generally in the
election of all directors of such other Person or the equity securities
or other equity interest having power (whether or not exercised) to
control or direct the management of such other Person or, if such other
Person is a Subsidiary of another Person, of the Person or Persons
(other than an individual) which ultimately control such first mentioned
other Person.
"COMPETING PERMITTED BID" means a Take-over Bid that:
(i) is made after a Permitted Bid or Competing Permitted Bid has
been made and prior to the expiry of that Permitted Bid or
Competing Permitted Bid (in this definition, the "Prior Bid");
(ii) satisfies all components of the definition of a Permitted Bid
other than the requirements set out in clauses (ii)(A), (B), and
(D) of that definition; and
(iii) contains, and the taking up and payment for securities tendered
or deposited thereunder are subject to, irrevocable and
unqualified conditions that:
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(A) no Common Shares shall be taken up or paid for pursuant
to the Take-over Bid (x) prior to the Close of Business
on a date that is not earlier than the later of 35 days
after the date of such Take-over Bid and the earliest
date on which Common Shares may be taken up or paid for
under any Prior Bid in existence at the date of such
Take-over Bid, and (y) then only if, at the time that
such Common Shares are first taken up or paid for, more
than 50% of the then outstanding Common Shares held by
Independent Shareholders have been deposited or tendered
pursuant to the Take-over Bid and not withdrawn;
(B) Common Shares may be deposited pursuant to such
Take-over Bid, unless the Take-over Bid is withdrawn, at
any time prior to the Close of Business on the date that
the Prior Bid described in clause (A) above expires; and
(C) in the event that the requirement set forth in subclause
(iii)(A)(y) of this definition is satisfied, the Offeror
will make a public announcement of that fact and the
Take-over Bid will remain open for deposits and tenders
of Common Shares for not less than 10 days from the date
of such public announcement.
provided always that a Competing Permitted Bid will cease to be
a Competing Permitted Bid at any time when such bid ceases to
meet any of the provisions of this definition and provided that,
at such time, any acquisition of Voting Shares made pursuant to
such Competing Permitted Bid, including any acquisition of
Voting Shares theretofore made, will cease to be a Permitted Bid
Acquisition.
"CONTROLLED": a Person shall be deemed to be "controlled" by another
Person or two or more Persons if:
(i) securities entitled to vote in the election of directors
(including, for Persons other than corporations, the
administrators, managers, trustees or other persons performing
similar functions in respect of any such Person) carrying more
than 50% of the votes for the election of directors are held,
directly or indirectly, by or for the benefit of the other
Person or Persons; and
(ii) the votes carried by such securities are entitled, if exercised,
to elect, appoint or designate a majority of the board of
directors of such corporation or other Person;
and "CONTROLS", "CONTROLLING" and "UNDER COMMON CONTROL WITH" shall be
interpreted accordingly.
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"CONVERTIBLE SECURITIES" means at any time any securities issued by the
Corporation from time to time (other than the Rights) carrying any
exercise, conversion, or exchange right pursuant to which the holder
thereof may acquire Voting Shares or other securities which are
convertible into or exercisable or exchangeable for Voting Shares.
"CONVERTIBLE SECURITY ACQUISITION" means the acquisition of Voting
Shares upon the exercise of Convertible Securities received by a Person
pursuant to a Permitted Bid Acquisition, an Exempt Acquisition or a
Pro-Rata Acquisition.
"EXEMPT ACQUISITION" means a Share acquisition: (i) in respect of which
the Board of Directors has waived the application of Section 3.1
pursuant to the provisions of subsections 5.1(b), (c) or (d) hereof;
(ii) pursuant to a regular dividend reinvestment or other plan of the
Corporation made available by it to all holders of Voting Shares of a
class or series or Voting Shares where such plan permits the holder to
direct that dividends paid in respect of such Voting Shares be applied
to the purchase from the Corporation of' further securities of the
Corporation; or (iii) pursuant to a distribution of Voting Shares, or
securities convertible into or exchangeable for Voting Shares made by
the Corporation pursuant to a prospectus or a securities exchange
take-over bid, by way of a private placement, provided that such private
placement has received the approval of the Board of Directors and all
applicable securities regulatory authorities, or pursuant to an
amalgamation, merger or other statutory procedure requiring shareholder
approval.
"EXERCISE PRICE" means, as of any date, the price at which a holder may
purchase the securities issuable upon exercise of one whole Right. Until
adjustment thereof in accordance with the terms hereof, the Exercise
Price shall equal $90.
"EXPIRATION TIME" means the earliest of: (i) the Termination Time; (ii)
March 29, 2009; and (iii) the Close of Business on the date this
Agreement becomes void pursuant to the provisions of Section 5.17
hereof.
"FIDUCIARY" means, when acting in that capacity, a trust company
registered under the trust company legislation of Canada or any province
thereof, a trust company organized under the laws of any state of the
United States, a portfolio manager registered under the securities
legislation of one or more provinces of Canada or an investment adviser
registered under the United States INVESTMENT ADVISERS ACT OF 1940, as
amended, or any other securities legislation of the United States or any
state of the United States.
"FLIP-IN EVENT" means a transaction or event that results in a Person
becoming an Acquiring Person.
"INDEPENDENT SHAREHOLDERS" means all holders of Common Shares other than
(i) any Acquiring Person, (ii) any Offeror, (iii) any Affiliate or
Associate of any Acquiring Person or Offeror, (iv) any Person acting
jointly or in concert with any Person referred to in clauses (i), (ii)
or (iii) above, and (v) any employee benefit plan, deferred profit
sharing plan, stock participation plan or trust for the benefit of
employees of the Corporation or a wholly-owned Subsidiary of the
Corporation, unless the beneficiaries of such plan or
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trust direct the manner in which such Common Shares are to be voted or
direct whether the Common Shares are to be tendered to a Take-over Bid.
"MARKET PRICE" per security of any securities on any date means the
average of the daily closing prices per security of such securities
(determined as described below) on each of the 20 consecutive Trading
Days through and including the Trading Day immediately preceding such
date; PROVIDED, HOWEVER, that if an event of a type analogous to any of
the events described in Section 2.3 hereof shall have caused the closing
prices used to determine the Market Price on any Trading Days not to be
fully comparable with the closing price on such date (or, if such date
is not a Trading Day, on the immediately preceding Trading Day), each
such closing price so used shall be appropriately adjusted in a manner
analogous to the applicable adjustment provided for in Section 2.3
hereof in order to make it fully comparable with the closing price on
such date (or, if such date is not a Trading Day, on the immediately
preceding Trading Day). The closing price per security of any securities
on any date shall he:
(i) the closing board lot sale price on such date or, if such price
is not available, the average of the closing bid and asked
prices per security, as reported by the principal Canadian stock
exchange on which such securities are listed or admitted to
trading, or if for any reason neither of such prices is
available on such day or the securities are not listed or
admitted to trading on a Canadian stock exchange, the closing
board lot sale price or, if such price is not available, the
average of the closing bid and asked prices, for such securities
as reported by such other securities exchange on which such
securities are listed or admitted for trading;
(ii) if, for any reason, none of such prices is available on such
date or the securities are not listed or admitted to trading on
a Canadian stock exchange or other securities exchange, the last
sale price, or in case no sale takes place on such date, the
average of the high bid and low asked prices for such securities
in the over-the-counter market, as quoted by any reporting
system then in use (as selected by the Board of Directors); or
(iii) if the securities are not listed or admitted to trading as
contemplated in clauses (i) or (ii) above, the average of the
closing bid and asked prices as furnished by a professional
market maker making a market in the securities selected by the
Board of Directors;
PROVIDED, HOWEVER, that if on any such date the closing price per
security cannot be determined in accordance with the foregoing, the
closing price per security of such securities on such date shall mean
the fair value per security of such securities on such date as
determined by the Board of Directors, after consultation with an
internationally recognized investment banking firm as to the fair value
per security of such securities. The Market Price shall be expressed in
Canadian dollars and if initially determined in respect of any day
forming part of the 20 consecutive Trading Day period in question in
United States dollars, such amount shall be translated into Canadian
dollars at the Canadian Dollar Equivalent thereof.
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"OFFER TO ACQUIRE" includes:
(i) an offer to purchase, or a solicitation of an offer to sell,
Common Shares or Convertible Securities; and
(ii) an acceptance of an offer to sell Common Shares or Convertible
Securities, whether or not such offer to sell has been
solicited;
or any combination thereof, and the Person accepting an offer to sell
shall be deemed to be making an Offer to Acquire to the Person that made
the offer to sell.
"OFFEROR" means a Person who is making or has announced a current
intention to make a Take-over Bid (including a Permitted Bid or
Competing Permitted Bid but excluding an ordinary market transaction
(including a prearranged trade in the ordinary course of business)
contemplated in paragraph (v) of the definition of Beneficial Owner) but
only so long as the Take-over Bid so announced or made has not been
withdrawn or terminated or has not expired.
"PERMITTED BID" means a Take-over Bid which is made by means of a
Take-over Bid circular and which also complies with the following
additional provisions:
(i) the Take-over Bid is made to all holders of record of Common
Shares, other than the Offeror;
(ii) the Take-over Bid shall contain, and the take-up and payment for
securities tendered or deposited thereunder shall be subject to,
irrevocable and unqualified conditions that:
(A) no Common Shares shall be taken up or paid for pursuant
to the Take-over Bid (x) prior to the Close of Business
(Toronto time) on a date which is not earlier than 60
days following the date the Take-over Bid circular is
sent to shareholders of the Corporation and (y) then
only if, at the Close of Business on the date Common
Shares are first taken up or paid for under the
Take-over Bid, more than 50% of the then outstanding
Common Shares held by Independent Shareholders have been
deposited or tendered pursuant to the Take-over Bid and
not withdrawn;
(B) Common Shares may be deposited pursuant to such
Take-over Bid, unless such Take-over Bid is withdrawn,
at any time prior to the date Common Shares are first
taken up or paid for under the Take-over Bid;
(C) any Common Shares deposited pursuant to the Take-over
Bid may be withdrawn until taken up and paid for; and
(D) in the event that the requirement set forth in subclause
(A)(y) of this definition is satisfied, the Offeror will
make a public announcement of that fact and the
Take-over Bid will remain open for deposits and tender
of
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Common Shares for not less than 10 days from the date of
such public announcement;
provided always that a Permitted Bid will cease to be a Permitted Bid at
any time when such bid ceases to meet any of the provisions of this
definition and any acquisitions of Common Shares made pursuant to such
Permitted Bid, including any acquisition of Common Shares theretofore
made, will cease to be a Permitted Bid Acquisition.
"PERMITTED BID ACQUISITION" means a Share acquisition made pursuant to a
Permitted Bid or Competing Permitted Bid.
"PERMITTED LOCK-UP AGREEMENT" means an agreement between a Person and
one or more holders of Voting Shares (each, a "LOCKED-UP PERSON") (the
terms of which are publicly disclosed and a copy of which is made
available to the public, including the Corporation, not later than the
date of the Lock-up Bid (as defined below) or, if the Lock-up Bid has
been made prior to the date on which such agreement is entered into, not
later than the date of such agreement and if such date is not a Business
Day, the next Business Day) pursuant to which each such Locked-up Person
agrees to deposit or tender Voting Shares to a Take-over Bid (the
"LOCK-UP BID") made or to be made by the Person, any of such Person's
Affiliates or Associates or any other Person acting jointly or in
concert with such Person, provided that:
(i) the agreement permits any Locked-up Person to terminate its
obligation to deposit or tender to or not to withdraw Voting
Shares from the Lock-up Bid in order to tender or deposit the
Voting Shares to another Take-over Bid or support another
transaction:
(A) where the price or value per Common Share offered under
such other Take-over Bid or transaction is higher than
the price or value per Common Share offered under the
Lock-up Bid; or
(B) if:
(1) the price or value per Common Share offered
under the other Take-over Bid or transaction
exceeds by as much as or more than a specified
amount (the "Specified Amount") the price or
value per Common Share offered under the Lock-up
Bid, provided that such Specified Amount is not
greater than 7% of the price or value per Common
Share offered under the Lock-up Bid; or
(2) the number of Voting Shares to be purchased
under the other Take-over Bid or transaction
exceeds by as much as or more than a specified
number (the "SPECIFIED NUMBER") the number of
Voting Shares that the Offeror has offered to
purchase under the Lock-up Bid at a price or
value per Common Share that is not less than the
price or value per Common Share offered under
the Lock-up Bid, provided that the Specified
Number is not greater than 7% of the
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number of Voting Shares offered to be purchased
under the Lock-up Bid,
and, for greater clarity, the agreement may contain a
right of first refusal or require a period of delay to
give such Person an opportunity to match a higher price
in another Take-over Bid or transaction or other similar
limitation on a Locked-up Person's right to withdraw
Voting Shares from the agreement, so long as the
limitation does not preclude the exercise by the
Locked-up Person of the right to withdraw Voting Shares
during the period of the other Take-over Bid or
transaction; and
(ii) no "break-up" fees, "top-up" fees, penalties, expenses or other
amounts that exceed in the aggregate the greater of:
(A) the cash equivalent of 2.5% of the price or value of the
consideration payable under the Lock-up Bid to a
Locked-up Person; and
(B) 50% of the amount by which the price or value of the
consideration payable under another Take-over Bid or
transaction to a Locked-up Person exceeds the price or
value of the consideration that such Locked-up Person
would have received under the Lock-up Bid,
shall be payable by a Locked-up Person pursuant to the agreement
in the event a Locked-up Person fails to deposit or tender
Voting Shares to the Lock-up Bid or withdraws Voting Shares in
order to accept the other Take-over Bid or support another
transaction.
"PERSON" includes any individual, firm, partnership, association, trust,
body corporate, joint venture, syndicate or other form of unincorporated
organization, government and its agencies and instrumentalities or other
entity or group (whether or not having legal personality) and any
successor (by merger, statutory amalgamation or arrangement, or
otherwise) thereof.
"PRO-RATA ACQUISITION" means the acquisition of Voting Shares or
securities convertible into or exchangeable for Voting Shares (i) as a
result of a stock dividend, stock split or other event pursuant to which
a Person receives or acquires Voting Shares or securities convertible
into or exchangeable for Voting Shares on the same pro-rata basis as all
other holders of Voting Shares of the same class or series, or (ii)
pursuant to a regular dividend reinvestment plan or other plan of the
Corporation made available by the Corporation to the holders of Voting
Shares where such plan permits the holder to direct that the dividends
paid in respect of such Voting Shares be applied to the purchase from
the Corporation of further securities of the Corporation, or (iii)
pursuant to the receipt and/or exercise of rights issued by the
Corporation on a pro-rata basis to all holders of a class or series of
Voting Shares to subscribe for or purchase Voting Shares or securities
convertible into or exchangeable for Voting Shares provided that such
rights are acquired directly from the Corporation and not from any other
Person.
"RECORD TIME" has the meaning ascribed to that term in the second
recital hereto.
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"REDEMPTION PRICE" has the meaning ascribed to that term in subsection
5.1(a) hereof.
"REGULAR PERIODIC CASH DIVIDENDS" means cash dividends paid at regular
intervals in any fiscal year of the Corporation to the extent that such
cash dividends do not exceed, in the aggregate, the greatest of:
(i) 200% of the aggregate amount of cash dividends declared payable
by the Corporation on its Common Shares in its immediately
preceding fiscal year;
(ii) 300% of the arithmetic mean of the aggregate amounts of cash
dividends declared payable by the Corporation on its Common
Shares in its three immediately preceding fiscal years; and
(iii) 100% of the aggregate consolidated net income of the
Corporation, before extraordinary items, for its immediately
preceding fiscal year.
"RIGHTS" means the herein described rights to purchaser securities
pursuant to the terms and subject to the conditions set forth herein;
"RIGHTS AGENT" means Computershare Investor Services Inc., a company
incorporated under the laws of Canada, and any successor Rights Agent
appointed pursuant to the provisions hereof.
"RIGHTS CERTIFICATE" has the meaning ascribed to that term in subsection
2.2(c) hereof.
RIGHTS REGISTER" and "RIGHTS REGISTRAR" shall have the respective
meanings ascribed thereto in subsection 2.6(a) hereof.
"SECURITIES ACT (ONTARIO)" means the SECURITIES ACT, R.S.O. 1990, c.S.5,
as amended, and the regulations thereunder, unless otherwise specified,
as the same exist on the date hereof.
"SEPARATION TIME" means the Close of Business (Toronto time) on the
tenth Business Day after the earliest of:
(i) the Stock Acquisition Date;
(ii) the date of the commencement of, or first public announcement of
the intent of any Person (other than the Corporation or any
Subsidiary of the Corporation) to commence, a Take-over Bid
(other than a Permitted Bid or a Competing Permitted Bid, as the
case may be); and
(iii) the date upon which a Permitted Bid or Competing Permitted Bid
ceases to be such;
or such later date as may be determined by the Board of Directors in
good faith, provided that (i) if the foregoing results in a Separation
Time being prior to the Record Time, the Separation Time shall (subject
to any determination of the Board of Directors as
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aforesaid) be the Record Time, (ii) if any such Take-over Bid expires,
is cancelled, is terminated or is otherwise withdrawn prior to the
Separation Time without securities deposited thereunder being taken up
and paid for, then such Take-over Bid shall be deemed, for purposes of
this definition never to have been made, and (iii) if the Board of
Directors determines, pursuant to Section 5.1, to waive the application
of Section 3.1 to a Flip-In Event, then the Separation Time in respect
of such Flip-In Event shall be deemed never to have occurred.
"SHARES" means the shares in the capital of the Corporation.
"STOCK ACQUISITION DATE" means the first date of public announcement
(which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 101 of the SECURITIES ACT
(Ontario), as amended from time to time and any provision substituted
therefor) by the Corporation or an Acquiring Person of facts indicating
that a Person has become an Acquiring Person.
"SUBSIDIARY":
A body corporate is a Subsidiary of another body corporate if:
(i) it is controlled by (A) that other, or (B) that other and one or
more bodies corporate, each of which is controlled by that
other, or (C) two or more bodies corporate, each of which is
controlled by that other, or
(ii) it is a Subsidiary of a body corporate that is that other's
Subsidiary.
"TAKE-OVER BID" means an Offer to Acquire Common Shares or Convertible
Securities (or both), where the securities subject to the Offer to
Acquire, together with the Common Shares, if any, into which the
securities subject to the Offer to Acquire are convertible and the
Voting Shares Beneficially Owned by the Offeror at the date of the Offer
to Acquire constitute, in the aggregate, 20% or more of the then
outstanding Voting Shares.
"TERMINATION TIME" means the time at which the right to exercise Rights
shall terminate pursuant to Section 5.1 hereof.
"TRADING DAY", when used with respect to any securities, means a day on
which the principal securities exchange in Canada on which such
securities are listed or admitted to trading is open for the transaction
of business, or if the securities are not listed or admitted to trading
on any securities exchange in Canada, a Business Day.
"U.S.-CANADIAN EXCHANGE RATE" means, on any date:
(i) if on such date the Bank of Canada sets an average noon spot
rate of exchange for the conversion of one United States dollar
into Canadian dollars, such rate; and
(ii) in any other case, the rate for such date for the conversion of
one United States dollar into Canadian dollars calculated in the
manner which shall be determined by the Board of Directors from
time to time.
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"U.S. DOLLAR EQUIVALENT" of any amount which is expressed in Canadian
dollars means, on any date, the United States dollar equivalent of such
amount determined by reference to the U.S.-Canadian Exchange Rate on
such date.
"VOTING SHARE REDUCTION" means an acquisition, redemption or
cancellation by the Corporation of Voting Shares which by reducing the
number of Voting Shares outstanding, increases the percentage of Voting
Shares Beneficially Owned by any Person to 20% or more of the Voting
Shares then outstanding.
"VOTING SHARES" means, collectively, the Common Shares and any other
Shares entitled to vote generally for the election of directors.
1.2 HOLDER
As used in this Agreement, unless the context otherwise requires, the
term "holder" when used with reference to Rights, means the registered holder of
such Rights or, prior to the Separation Time, the associated Common Shares.
1.3 ACTING JOINTLY OR IN CONCERT
For purposes of this Agreement, it is a question of fact whether a
Person is acting jointly or in concert with another Person but a Person shall be
deemed to be acting jointly or in concert with every other Person who (i) is an
Associate or Affiliate of such first mentioned Person; or (ii) who is a party to
any agreement, commitment or understanding, whether formal or informal, with the
first mentioned Person or any Associate or Affiliate thereof, for the purpose of
acquiring or offering to acquire Common Shares.
1.4 APPLICATION OF STATUTES, REGULATIONS AND RULES
Unless the context otherwise requires, any reference to a specific
section, subsection, clause or rule of any act or regulation shall be deemed to
refer to the same as it may be amended, re-enacted or replaced or, if repealed
and there shall be no replacement therefore, to the same as it is in effect on
the date of this Agreement.
1.5 CURRENCY
All sums of money which are referred to in this Agreement are expressed
in lawful money of Canada, unless otherwise specified.
1.6 HEADINGS AND REFERENCES
The headings of the Articles and Sections of this Agreement and the
Table of Contents are inserted for convenience of reference only and shall not
affect the construction or interpretation of this Agreement. All references to
Articles, Sections and Exhibits are to articles and sections of and exhibits to,
and forming part of, this Agreement. The words "hereto", "herein", "hereof",
"hereunder", "this Agreement", "the Rights Agreement" and similar expressions
refer to this Agreement including the Exhibits, as the same may be amended,
modified or supplemented at any time or from time to time.
- 15 -
1.7 SINGULAR, PLURAL, ETC.
In this Agreement, where the context so admits, words importing the
singular number include the plural and vice versa and words importing gender
include the masculine, feminine and neuter genders.
1.8 GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
Wherever in this Agreement reference is made to generally accepted
accounting principles, such reference shall be deemed to be the recommendations
at the relevant time of the Canadian Institute of Chartered Accountants, or any
successor institute, applicable on a consolidated basis (unless otherwise
specifically provided herein to be applicable on an unconsolidated basis) as at
the date on which a calculation is made or required to be made in accordance
with generally accepted accounting principles. Where the character or amount of
any asset or liability or item of revenue or expense is required to be
determined, or any consolidation or other accounting computation is required to
be made for the purpose of this Agreement or any document, such determination or
calculation shall, to the extent applicable and except as otherwise specified
herein or as otherwise agreed in writing by the parties, be made in accordance
with generally accepted accounting principles applied on a consistent basis.
ARTICLE II
THE RIGHTS
2.1 ISSUANCE AND LEGEND ON COMMON SHARE CERTIFICATES
(a) One right in respect of each Common Share outstanding at the
Record Time and each Common Share that may be issued after the Record Time and
prior to the earlier of the Separation Time and the Expiration Time shall be
issued in accordance with the terms hereof. Notwithstanding the foregoing, one
Right in respect of each Common Share issued after the Record Time upon the
exercise of rights pursuant to Convertible Securities outstanding at the Record
Time may be issued after the Separation Time but prior to the Expiration Time.
(b) Certificates for Common Shares issued after the Record Time
hereof but prior to the Separation Time shall evidence one Right for each Common
Share represented thereby and shall have impressed, printed, or written thereon
or otherwise affixed thereto a legend in substantially the following form:
"Until the Separation Time (as such term is defined in the Rights
Agreement referred to below), this certificate also evidences and
entitles the holder hereof to certain Rights as set forth in a Rights
Agreement, made as of March 29, 2006, (the "Rights Agreement"), between
Kinross Gold Corporation (the "Corporation") and Computershare Investor
Services Inc., as Rights Agent, the terms of which are hereby
incorporated herein by reference and a copy of which is on file and may
be inspected during normal business hours at the principal executive
offices of the Corporation. Under certain circumstances, as set forth in
the Rights Agreement, such Rights may be amended or redeemed, may
expire, may become void (if, in certain circumstances, they are
"Beneficially Owned" by
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a "Person" who is or becomes an "Acquiring Person" or any Person acting
jointly or in concert with an Acquiring Person or with an "Affiliate" or
"Associate" of an "Acquiring Person", as such terms are defined in the
Rights Agreement, or a transferee thereof), or may be evidenced by
separate certificates and may no longer be evidenced by this
certificate. The Corporation will mail or arrange for the mailing of a
copy of the Rights Agreement to the holder of this certificate without
charge within five days after the receipt of a written request
therefor."
Certificates representing Common Shares that are issued and outstanding
at the Record Time shall evidence one Right for each Common Share evidenced
thereby notwithstanding the absence of a legend in substantially the foregoing
form until the earlier of the Separation Time and the Expiration Time.
2.2 INITIAL EXERCISE PRICE: EXERCISE OF RIGHTS: DETACHMENT OF RIGHTS
(a) Subject to adjustment as herein set forth, each Right will
entitle the holder thereof, after the Separation Time and prior to the
Expiration Time, to purchase, for the Exercise Price (or its U.S. Dollar
Equivalent on the Business Day immediately preceding the date of exercise of the
Right), one Common Share. Notwithstanding any other provision of this Agreement,
any Rights held by the Corporation or any of its Subsidiaries shall be void.
(b) Until the Separation Time:
(i) the Rights shall not be exercisable and no Right may be
exercised; and
(ii) for administrative purposes, each Right shall be
evidenced by the certificate for the associated Common
Share registered in the name of the holder thereof
(which certificate shall be deemed to represent a Rights
Certificate) and shall be transferable only together
with, and shall be transferred by a transfer of, such
associated Common Share.
(c) From and after the Separation Time and prior to the Expiration
Time, the Rights (i) may be exercised and (ii) shall be registered and
transferable independent of Common Shares. Promptly following the Separation
Time, the Corporation shall prepare and the Rights Agent shall mail to each
holder of record of Common Shares as of the Separation Time (other than an
Acquiring Person, any other Person whose Rights are or become void pursuant to
the provisions of subsection 3.1(b) hereof and, in respect of any Rights
Beneficially Owned by such Acquiring Person which are not held of record by such
Acquiring Person, the holder of record of such Rights), at such holder's address
as shown in the records of the Corporation (the Corporation hereby agreeing to
furnish copies of such records to the Rights Agent for this purpose):
(i) a certificate (a "Rights Certificate") in substantially
the form of Exhibit "A" hereto appropriately completed
and registered in such holder's name, representing the
number of Rights held by such holder at the Separation
Time and having such marks of identification or
designation and such legends, summaries or endorsements
printed thereon as the Corporation may deem appropriate
and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any
applicable law
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or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange or
quotation system on which the Rights may from time to
time be listed or traded, or to conform to usage; and
(ii) a disclosure statement describing the Rights.
(d) Rights may be exercised in whole at any time or in part from
time to time on any Business Day (or other day that is not a bank holiday at the
place of exercise) after the Separation Time and prior to the Expiration Time by
submitting to the Rights Agent at its office in the City of Toronto, Ontario or
at any other office of the Rights Agent in the cities specified in the Rights
Certificate or designated from time to time for that purpose by the Corporation
after consultation with the Rights Agent:
(i) the Rights Certificate evidencing such Rights with an
Election to Exercise (an "Election to Exercise")
substantially in the form attached to the Rights
Certificate, appropriately completed and duly executed
by the holder or his executors or administrators or
other personal representatives or his legal attorney
duly appointed by instrument in writing in form and
executed in a manner satisfactory to the Rights Agent;
and
(ii) payment by certified cheque or money order payable to
the order of the Rights Agent, of a sum equal to the
Exercise Price multiplied by the number of Rights being
exercised and a sum sufficient to cover any transfer tax
or charge which may be payable in respect of any
transfer involved in the issuance, transfer or delivery
of Rights Certificates or the issuance, transfer or
delivery of certificates for Common Shares in a name
other than that of the holder of the Rights being
exercised.
(e) Upon receipt of a Rights Certificate accompanied by a duly
completed and executed Election to Exercise which does not indicate that Rights
evidenced by such Rights Certificate have become void pursuant to subsection
3.1(b) hereof and payment as set forth in subsection 2.2(d) above, the Rights
Agent (unless otherwise instructed by the Corporation) shall thereupon promptly:
(i) requisition from a transfer agent of the Common Shares
certificates for the number of Common Shares to be
purchased (the Corporation hereby irrevocably
authorizing its transfer agents to comply with all such
requisitions);
(ii) when appropriate, requisition from the Corporation the
amount of cash to be paid in lieu of issuing fractional
Common Shares;
(iii) after receipt of such certificates, deliver the same to
or upon the order of the registered holder of such
Rights Certificate, registered in such name or names as
may be designated by such holder together with, where
applicable, any cash payment in lieu of a fractional
interest; and
(iv) tender to the Corporation all payments received on
exercise of the Rights.
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(f) In case the holder of any Rights shall exercise less than all
the Rights evidenced by such holder's Rights Certificate, a new Rights
Certificate evidencing (subject to the provisions of subsection 5.5(a) hereof)
the Rights remaining unexercised will be issued by the Rights Agent to such
holder or to such holder's duly authorized assigns.
(g) The Corporation covenants and agrees to:
(i) take all such action as may be necessary on its part and
within its powers to ensure that all Shares delivered
upon exercise of Rights shall, at the time of delivery
of the certificates evidencing such Shares (subject to
payment of the Exercise Price), be duly and validly
authorized, executed, issued and delivered and be fully
paid and non-assessable;
(ii) take all reasonable action as may be necessary on its
part and within its power to comply with any applicable
requirements of the BUSINESS CORPORATIONS ACT (ONTARIO),
the SECURITIES ACT (ONTARIO) or comparable legislation
of each of the provinces and territories of Canada and
of the United States of America, and the rules and
regulations thereunder, and any other applicable law,
rule or regulation, in connection with the issuance and
delivery of Rights Certificates and of any securities of
the Corporation upon exercise of Rights;
(iii) use its reasonable efforts to cause all Shares of the
Corporation issued upon exercise of Rights to be listed
upon The Toronto Stock Exchange or such other stock
exchange on which the Common Shares are listed at that
time;
(iv) pay when due and payable any and all Canadian federal,
provincial transfer taxes (not including any taxes
referable to the income or profit of the holder or
exercising Person or any liability of the Corporation to
withhold tax) and charges which may be payable in
respect of the original issuance or delivery of the
Rights Certificates or of any Shares of the Corporation
issued upon the exercise of Rights, provided that the
Corporation shall not be required to pay any transfer
tax or charge which may be payable in respect of any
transfer involved in the transfer or delivery of Rights
Certificates or the issuance or delivery of certificates
for securities in a name other than that of the holder
of the Rights being transferred or exercised;
(v) if necessary, cause to be reserved and kept available
out of its authorized and unissued Common Shares the
number of Common Shares that, as provided in this
Agreement, will from time to time be sufficient to
permit the exercise in full of all outstanding rights;
and
(vi) after the Separation Time, except as permitted by
Section 5.1 or Section 5.4, not take (or permit any
Subsidiary to take) any action if at the time such
action is taken it is reasonably foreseeable that such
action will
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diminish substantially or otherwise eliminate the
benefits intended to be afforded by the Rights.
2.3 ADJUSTMENTS TO EXERCISE PRICE, NUMBER OF RIGHTS
Subject to Section 5.19, the Exercise Price, the number and kind of
securities subject to purchase upon exercise of each Right and the number of
Rights outstanding are subject to adjustment from time to time as provided in
this Section 2.3.
(a) If the Corporation shall at any time after the Record Time and
prior to the Expiration Time:
(i) declare or pay a dividend on Common Shares payable in
Common Shares (or other Shares of capital or securities
exchangeable for or convertible into or giving a right
to acquire Common Shares or other Shares of capital)
otherwise than pursuant to any optional share dividend
program;
(ii) subdivide or change the outstanding Common Shares into a
greater number of Common Shares;
(iii) consolidate or change the outstanding Common Shares into
a smaller number of Common Shares; or
(iv) issue any Common Shares (or other shares of capital or
securities exchangeable for or convertible into or
giving a right to acquire Common Shares or other Shares
of capital) in respect of, in lieu of, or in exchange
for, existing Common Shares in a reclassification or
redesignation of Common Shares, an amalgamation or
statutory arrangement,
the Exercise Price and the number of Rights outstanding, or, if
the payment or effective date therefor shall occur after the
Separation Time, the securities purchasable upon exercise of
Rights shall be adjusted in the manner set forth below. If an
event occurs which would require an adjustment under both this
Section 2.3 and subsection 3.1(a), the adjustment provided for
in this Section 2.3 shall be in addition to, and shall be made
prior to, any adjustment required under subsection 3.1(a). If
the Exercise Price and number of Rights are to be adjusted:
(x) the Exercise Price in effect after such adjustment shall
be equal to the Exercise Price in effect immediately
prior to such adjustment divided by the number of Common
Shares (or other Shares of capital) (the "Expansion
Factor") that a holder of one Common Share immediately
prior to such dividend, subdivision, change,
consolidation or issuance would hold immediately
thereafter as a result thereof (assuming the exercise of
all such exchange or conversion rights, if any); and
(y) each Right held prior to such adjustment shall become
that number of Rights equal to the Expansion Factor, and
the adjusted number of Rights shall be deemed to be
distributed among the Common Shares with respect
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to which the original Rights were associated (if they
remain outstanding) and the Shares issued in respect of
such dividend, subdivision, change, consolidation or
issuance, so that each such Common Share (or other whole
share or security exchangeable for or convertible into a
whole Share of capital) shall have exactly one Right
associated with it.
If the securities purchasable upon exercise of Rights are to be
adjusted, the securities purchasable upon exercise of each Right
after such adjustment shall be the securities that a holder of
the securities purchasable upon exercise of one Right
immediately prior to such dividend, subdivision, change,
consolidation or issuance would hold immediately thereafter as a
result thereof. To the extent that any such rights of exchange,
conversion or acquisition are not exercised prior to the
expiration thereof, the Exercise Price shall be readjusted to
the Exercise Price which would then be in effect based upon the
number of Common Shares (or securities convertible into or
exchangeable for Common Shares) actually issued upon the
exercise of such rights. If after the Record Time and prior to
the Expiration Time the Corporation shall issue any shares of
its authorized capital other than Common Shares in a transaction
of a type described in the first sentence of this subsection
2.3(a), such shares shall be treated herein as nearly equivalent
to Common Shares as may be practicable and appropriate under the
circumstances and the Corporation and the Rights Agent agree to
amend this Agreement in order to effect such treatment.
If the Corporation shall at any time after the Record Time and
prior to the Separation Time issue any Common Shares otherwise
than in a transaction referred to in the preceding paragraph,
each such Common Share so issued shall automatically have one
new Right associated with it, which Right shall be evidenced by
the certificate representing such Share.
(b) If the Corporation shall at any time after the Record Time and
prior to the Separation Time fix a record date for the making of
a distribution to all holders of Common Shares of rights or
warrants entitling them (for a period expiring within 45 days
after such record date) to subscribe for or purchase Common
Shares (or securities convertible into or exchangeable for or
carrying a right to purchase or subscribe for Common Shares) at
a price per Common Share (or, in the case of a security
convertible into or exchangeable for or carrying a right to
purchase or subscribe for Common Shares, having a conversion,
exchange or exercise price (including the price required to be
paid to purchase such convertible or exchangeable security or
right) per share) that is less than 90% of the Market Price per
Common Share on such record date, the Exercise Price shall be
adjusted. The Exercise Price in effect after such record date
shall equal the Exercise Price in effect immediately prior to
such record date multiplied by a fraction, of which the
numerator shall be the number of Common Shares outstanding on
such record date plus the number of Common Shares which the
aggregate offering price of the total number of Common Shares so
to be offered (and/or the aggregate initial conversion, exchange
or exercise price of the convertible or exchangeable securities
or rights so to be offered (including the
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price required to be paid to purchase such convertible or
exchangeable securities or rights)) would purchase at such
Market Price and of which the denominator shall be the number of
shares of Common Shares outstanding on such record date plus the
number of additional Common Shares to be offered for
subscription or purchase (or into which the convertible or
exchangeable securities or rights so to be offered are initially
convertible, exchangeable or exercisable). In case such
subscription price may be paid in a form other than cash, the
value of such non-cash consideration shall be as determined by
the Board of Directors. To the extent that any such rights or
warrants are not so issued or, if issued, are not exercised
prior to the expiration thereof, the Exercise Price shall be
readjusted to the Exercise Price which would then be in effect
if such record date had not been fixed or to the Exercise Price
which would then be in effect based upon the number of Common
Shares (or securities convertible into or exchangeable for
Common Shares) actually issued upon the exercise of such rights
or warrants, as the ease may be. For purposes of this Agreement,
the granting of the right to purchase Common Shares (whether
previously unissued, treasury shares or otherwise) pursuant to
any optional dividend reinvestment plan and/or any Common Share
purchase plan providing for the reinvestment of dividends
payable on securities of the Corporation and/or employee stock
option, stock purchase or other employee benefit plan (so long
as such right to purchase is in no case evidenced by the
delivery of rights or warrants) shall not be deemed to
constitute an issue of rights or warrants by the Corporation;
PROVIDED, HOWEVER, that, in the case of any dividend
reinvestment plan, the right to purchase Common Shares is at a
price per share of not less than 90% of the then current market
price per share (determined as provided in such plan) of the
Common Shares.
(c) If the Corporation shall at any time after the Record Time and
prior to the Separation Time fix a record date for the making of
a distribution to all holders of Common Shares of evidences of
indebtedness or assets (other than a Regular Periodic Cash
Dividend or a dividend paid in Common Shares) or rights or
warrants (excluding those referred to in subsection 2.3(a) or
2.3(b)), the Exercise Price shall be adjusted. The Exercise
Price in effect after such record date shall, subject to
adjustment as provided in the penultimate sentence of subsection
2.3(b), equal the Exercise Price in effect immediately prior to
such record date less the fair market value (as determined by
the Board of Directors) of the portion of the assets, evidences
of indebtedness, rights or warrants so to be distributed
applicable to the securities purchasable upon exercise of one
Right.
(d) Each adjustment made pursuant to this Section 2.3 shall be made
as of:
(i) the payment or effective date for the applicable
dividend, subdivision, change, consolidation or issuance
in the case of an adjustment made pursuant to subsection
2.3(a) above; and
(ii) the record date for the applicable dividend or
distribution, in the case of an adjustment made pursuant
to subsections 2.3(b) or (c) above.
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(e) Subject to the prior consent of the holders of Common Shares or
Rights obtained in accordance with the provisions of subsection
5.4(b) or (c), as applicable, if the Corporation shall at any
time after the Record Time and prior to the Expiration Time
issue any Shares of capital (other than Common Shares), or
rights or warrants to subscribe for or purchase any such Shares,
or securities convertible into or exchangeable for any such
Shares, in a transaction referred to in clause (a)(i) or (a)(iv)
above and if the Board of Directors determines that the
adjustments contemplated by subsections 2.3(a), (b) and (d)
above in connection with such transaction will not appropriately
protect the interests of the holders of Rights, the Board of
Directors may determine what other adjustments to the Exercise
Price, number of Rights and/or securities purchasable upon
exercise of Rights would be appropriate and, notwithstanding
such clauses, such adjustments (rather than the adjustments
contemplated by subsections 2.3(a), (b) and (d) above) shall be
made and the Corporation and the Rights Agent shall amend this
Agreement as appropriate to provide for such adjustments.
(f) Anything herein to the contrary notwithstanding, no adjustment
to the Exercise Price shall be required unless such adjustment
would require an increase or decrease of at least 1% in such
Exercise Price; PROVIDED, HOWEVER, that any adjustments which by
reason of this subsection 2.3(f) are not required to be made
shall be carried forward and taken into account in any
subsequent adjustment. Each adjustment made pursuant to this
Section 2.3 shall be calculated to the nearest cent or to the
nearest one ten-thousandth of a Common Share or Right, as the
case may be.
(g) All Rights originally issued by the Corporation subsequent to
any adjustment made to an Exercise Price hereunder shall
evidence the right to purchase, at the adjusted Exercise Price,
the number of Common Shares purchasable from time to time
hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
(h) Unless the Corporation shall have exercised its election as
provided in subsection 2.3(i), upon each adjustment of an
Exercise Price as a result of the calculations made in
subsections 2.3(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence
the right to purchase, at the adjusted Exercise Price, that
number of Common Shares (calculated to the nearest one
ten-thousandth) obtained by:
(i) multiplying (A) the number of Common Shares covered by a
Right immediately prior to this adjustment, by (B) the
Exercise Price in effect immediately prior to such
adjustment of the Exercise Price; and
(ii) dividing the product so obtained by the Exercise Price
in effect immediately after such adjustment of the
Exercise Price.
(i) The Corporation may elect on or after the date of any adjustment
of an Exercise Price to adjust the number of Rights, in lieu of
any adjustment in the number of
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Common Shares purchasable upon the exercise of a Right. Each of
the Rights outstanding after the adjustment in the number of
Rights shall be exercisable for the number of Common Shares for
which a Right was exercisable immediately prior to such
adjustment. Each Right held of record immediately prior to such
adjustment of the number of Rights shall become the number of
Rights (calculated to the nearest one ten-thousandth) obtained
by dividing the Exercise Price in effect immediately prior to
the adjustment of the Exercise Price by the Exercise Price in
effect immediately after adjustment of the Exercise Price. The
Corporation shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the
adjustment and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which
the Exercise Price is adjusted or any date thereafter, but, if
the Rights Certificates have been issued, shall be at least 10
calendar days after the date of the public announcement. If
Rights Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this subsection 2.3(j), the
Corporation shall, as promptly as practicable, cause to be
distributed to holders of record of Rights Certificates on such
record date, Rights Certificates evidencing the additional
Rights to which such holder shall be entitled as a result of
such adjustment, or, at the option of the Corporation, shall
cause to be distributed to such holders of record in
substitution or replacement for the Rights Certificates held by
such holders prior to the date of adjustment, and upon surrender
thereof, if required by the Corporation, new Rights Certificates
evidencing all the Rights to which such holders shall be
entitled after such adjustment. Rights Certificates so to be
distributed shall be issued, executed and countersigned in the
manner provided for herein and may bear, at the option of the
Corporation, the adjusted Exercise Price and shall be registered
in the names of the holders of record of Rights Certificates on
the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the securities
purchasable upon exercise of the Rights, the Rights Certificates
theretofore and thereafter issued may continue to express the
securities so purchasable which were expressed in the initial
Rights Certificates issued hereunder.
(k) If, as a result of an adjustment made pursuant to Section 3.1,
the holder of any Right thereafter exercised shall become
entitled to receive any securities other than Common Shares,
thereafter the number of such other securities so receivable
upon exercise of any Right and the applicable Exercise Price
thereof shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as may be practicable
to the provisions with respect to the Common Shares contained in
the foregoing subsections of this Section 2.3 and the provisions
of this Agreement with respect to the Common Shares shall apply
on like terms to any such other securities.
(l) In any case in which this Section 2.3 shall require that any
adjustment in the Exercise Price be made effective as of a
record date for a specified event, the Corporation may elect to
defer until the occurrence of such event the issuance to the
holder of any Right exercised after such record date of the
number of
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Common Shares and other securities of the Corporation, if any,
issuable upon such exercise over and above the number of Common
Shares and other securities of the Corporation, if any, issuable
upon such exercise on the basis of the Exercise Price in effect
prior to such adjustment; PROVIDED, HOWEVER, that the
Corporation shall deliver to such holder an appropriate
instrument evidencing such holder's right to receive such
additional Common Shares or other securities upon the occurrence
of the event requiring such adjustment.
(m) Notwithstanding anything in this Section 2.3 to the contrary,
the Corporation shall be entitled to make such reductions in the
Exercise Price, in addition to those adjustments expressly
required by this Section 2.3, as and to the extent that, in
their judgment, the Board of Directors determines advisable in
order that any (i) subdivision or consolidation of the Common
Shares, (ii) issuance wholly for cash of any Common Shares at
less than applicable Market Price, (iii) issuance wholly for
cash of any Common Shares or securities that by their terms are
exchangeable for or convertible into or give a right to acquire
Common Shares, (iv) stock dividends, or (v) issuance of rights,
options or warrants referred to in this Section 2.3, hereafter
made by the Corporation to holders of its Common Shares, and
subject to applicable taxation laws, shall not be taxable to
such shareholders.
(n) Whenever an adjustment to the Exercise Price or a change in the
securities purchasable upon the exercise of Rights is made
pursuant to this Section 2.3, the Corporation shall promptly:
(i) prepare a certificate setting forth such adjustment and
a brief statement of the facts accounting for such
adjustment;
(ii) file with the Rights Agent and with each transfer agent
for the Common Shares, a copy of such certificate; and
(iii) cause notice of the particulars of such adjustment or
change to be given to the holders of the Rights.
Failure to file such certificate or to cause such notice to be
given as aforesaid, or any defect therein, shall not affect the
validity of any such adjustment or change.
2.4 DATE ON WHICH EXERCISE IS EFFECTIVE
Each Person in whose name any certificate for Shares is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder of
record of the Shares represented thereby on, and such certificate shall be
dated, the date upon which the Rights Certificate evidencing such Rights was
duly submitted (together with a duly completed Election to Exercise) and payment
of the Exercise Price for such Rights (and any applicable transfer taxes and
other charges payable by the exercising holder hereunder) was made; PROVIDED,
HOWEVER, that if the date of such exercise is a date upon which the relevant
Share transfer books of the Corporation are closed, such Person shall be deemed
to have become the recorded holder of such
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Shares on, and such certificate shall be dated, the next succeeding Business Day
on which the said Share transfer books of the Corporation are open.
2.5 EXECUTION, AUTHENTICATION, DELIVERY AND DATING OF RIGHTS CERTIFICATES
(a) The Rights Certificates shall be executed on behalf of the
Corporation by any two of it Chairman, President and Chief Executive Officer,
its Chief Financial Officer or its Corporate Secretary. The signature of any of
these officers on the Rights Certificates may be manual or facsimile.
(b) Rights Certificates bearing the manual or facsimile signatures
of individuals who were at any time the proper officers of the Corporation shall
bind the Corporation, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the countersignature and delivery of such
Rights Certificates.
(c) Promptly after the Corporation learns of the Separation Time,
the Corporation shall notify the Rights Agent of such Separation Time and shall
deliver Rights Certificates executed by the Corporation to the Rights Agent for
countersignature, and the Rights Agent shall countersign (manually or by
facsimile signature in a manner satisfactory to the Corporation) and deliver
such Rights Certificates to the holders of the Rights pursuant to subsection
2.2(c) hereof. No Rights Certificate shall be valid for any purpose until
countersigned by the Rights Agent in the manner described above.
(d) Each Rights Certificate shall be dated the date of
countersignature thereof.
2.6 REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE
(a) The Corporation shall cause to be kept a register (the "Rights
Register") in which, subject to such reasonable regulations as it may prescribe,
the Corporation shall provide for the registration and transfer of Rights. The
Rights Agent is hereby appointed "Rights Registrar" for the purpose of
maintaining the Rights Register for the Corporation and registering Rights and
transfers of Rights as herein provided. If the Rights Agent shall cease to be
the Rights Registrar, the Rights Agent shall have the right to examine the
Rights Register at all reasonable times.
After the Separation Time and prior to the Expiration Time, upon
surrender for registration of transfer or exchange of any Rights Certificate,
and subject to the provisions of subsection 2.6(c) below, the Corporation shall
execute, and the Rights Agent shall countersign and deliver, in the name of the
holder or the designated transferee or transferees, as required pursuant to the
holder's instructions, one or more new Rights Certificates evidencing the same
aggregate number of Rights as did the Rights Certificate so surrendered.
(b) All Rights issued upon any registration of transfer or exchange
of Rights Certificates shall be the valid obligations of the Corporation, and
such Rights shall be entitled to the same benefits under this Agreement as the
Rights surrendered upon such registration of transfer or exchange.
(c) Every Rights Certificate surrendered for registration of
transfer or exchange shall have the form of assignment thereon duly completed
and endorsed, or be accompanied by a
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written instrument of transfer in form satisfactory to the Corporation or the
Rights Agent, as the ease may be, duly executed by the holder thereof or such
holder's attorney duly authorized in writing. As a condition to the issuance of
any new Rights Certificate under this Section 2.6, the Corporation may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and other expenses (including the
reasonable fees and expenses of its Rights Agent) connected therewith.
(d) The Corporation shall not be required to register the transfer
or exchange of any Rights after the Rights have been terminated pursuant to the
provisions of this Agreement.
2.7 MUTILATED, DESTROYED, LOST AND STOLEN RIGHTS CERTIFICATES
(a) If any mutilated Rights Certificate is surrendered to the Rights
Agent prior to the Expiration Time, the Corporation shall execute and the Rights
Agent shall countersign and deliver a new Rights Certificate evidencing the same
number of Rights as did the Rights Certificate so surrendered.
(b) If there shall be delivered to the Corporation and the Rights
Agent prior to the Expiration Time (i) evidence to their satisfaction of the
destruction, loss or theft of any Rights Certificate and (ii) such security or
indemnity as may be required by them to save each of them and their respective
agents harmless, then, in the absence of notice to the Corporation or the Rights
Agent that such Rights Certificate has been acquired by a bona fide purchaser,
the Corporation shall execute and upon the Corporation's request, the Rights
Agent shall countersign and deliver, in lieu of any such destroyed, lost or
stolen Rights Certificate, a new Rights Certificate evidencing the same number
of Rights as did the Rights Certificate so destroyed, lost or stolen.
(c) As a condition to the issuance of any new Rights Certificate
under this Section 2.7, the Corporation may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the reasonable fees and
expenses of the Rights Agent) connected therewith.
(d) Every new Rights Certificate issued pursuant to this Section 2.7
in lieu of any destroyed, lost or stolen Rights Certificate shall evidence an
original additional contractual obligation of the Corporation, whether or not
the destroyed, lost or stolen Rights Certificate shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Agreement equally and proportionately with any and all other Rights duly issued
hereunder.
2.8 PERSONS DEEMED OWNERS
Prior to due presentment of a Rights Certificate (or, prior to the
Separation Time, the associated Share certificate) for registration of transfer,
the Corporation, the Rights Agent and any agent of the Corporation or the Rights
Agent may deem and treat the Person in whose name such Rights Certificate (or,
prior to the Separation Time, such Share certificate) is registered as the
absolute owner thereof and of the Rights evidenced thereby for all purposes
whatsoever. As used in this Agreement, unless the context otherwise requires,
the term "holder" of any Rights means the registered holder of such Rights (or,
prior to the Separation Time, the associated Shares).
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2.9 DELIVERY AND CANCELLATION OF CERTIFICATES
All Rights Certificates surrendered upon exercise or for redemption,
registration of transfer or exchange shall, if surrendered to any Person other
than the Rights Agent, be delivered to the Rights Agent and, in any case, shall
be promptly cancelled by the Rights Agent. The Corporation may at any time
deliver to the Rights Agent for cancellation any Rights Certificates previously
countersigned and delivered hereunder which the Corporation may have acquired in
any manner whatsoever, and all Rights Certificates so delivered shall be
promptly cancelled by the Rights Agent. No Rights Certificates shall be
countersigned in lieu of or in exchange for any Rights Certificates cancelled as
provided in this Section 2.9, except as expressly permitted by this Agreement.
The Rights Agent shall destroy all cancelled Rights Certificates and deliver a
certificate of destruction to the Corporation.
2.10 AGREEMENT OF RIGHTS HOLDERS
Every holder of Rights by accepting the same consents and agrees with
the Corporation and the Rights Agent and with every other holder of Rights that:
(a) prior to the Separation Time, each Right shall be transferable
only together with, and shall be transferred by a transfer of,
the associated Share;
(b) after the Separation Time, the Rights Certificates shall be
transferable only on the Rights Register as provided herein;
(c) prior to due presentment of a Rights Certificate (or, prior to
the Separation Time, the associated Share certificate) for
registration of transfer, the Corporation, the Rights Agent and
any agent of the Corporation or the Rights Agent may deem and
treat the Person in whose name the Rights Certificate (or, prior
to the Separation Time, the associated Share certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on such Rights Certificate or the associated Share
certificate made by anyone other than the Corporation or the
Rights Agent) for all purposes whatsoever, and neither the
Corporation nor the Rights Agent shall be affected by any notice
to the contrary;
(d) such holder has waived all rights to receive any fractional
Right or fractional Share upon exercise of a Right;
(e) such holder is otherwise bound by and subject to the provisions
of this Agreement, as amended from time to time in accordance
with the terms hereof in respect of all Rights held;
(f) this Agreement may be supplemented or amended from time to time
pursuant to subsection 5.4(a) or the last sentence of the
penultimate paragraph of subsection 2.3(a) hereof upon the sole
authority of the Board of Directors without the approval of any
holder of Rights; and
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(g) notwithstanding anything in this Agreement to the contrary,
neither the Corporation nor the Rights Agent shall have any
liability to any holder of a Right or any other Person as a
result of its inability to perform any of its obligations under
this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling by a court of
competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule,
regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining
performance of such obligation.
ARTICLE III
ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS
3.1 FLIP-IN EVENT
(a) Subject to the provisions of Section 2.2 and subsections 5.1(b),
(c) and (d) hereof and except as provided below, if prior to the Expiration Time
a Flip-in Event shall occur, each Right shall thereafter constitute, effective
at the Close of Business on the tenth Business Day after the relevant Stock
Acquisition Date, the right to purchase from the Corporation, upon exercise
thereof in accordance with the terms hereof, that number of Common Shares of the
Corporation having an aggregate Market Price on the date of consummation or
occurrence of such Flip-in Event equal to twice the Exercise Price for an amount
in cash equal to the Exercise Price (such right to be appropriately adjusted in
a manner analogous to the applicable adjustment provided for in Section 2.3
hereof in the event that, after such date of consummation or occurrence, an
event of a type analogous to any of the events described in Section 2.3 hereof
shall have occurred with respect to such Common Shares).
(b) Notwithstanding anything in this Agreement to the contrary, upon
the occurrence of a Flip-in Event, any Rights that are or were Beneficially
Owned on or after the earlier of the Separation Time and the Stock Acquisition
Date by:
(i) an Acquiring Person (or any Person acting jointly or in
concert with an Acquiring Person or with an Affiliate or
Associate of an Acquiring Person); or
(ii) a direct or indirect transferee of, or other successor
in title to, such Rights (a "Transferee"), who becomes a
Transferee concurrently with or subsequent to the
Acquiring Person becoming an Acquiring Person, in a
transfer, whether or not for consideration, that the
Board of Directors has determined is part of a plan,
understanding or scheme of an Acquiring Person (or an
Affiliate or Associate of an Acquiring Person or any
Person acting jointly or in concert with an Acquiring
Person or an Affiliate or Associate of an Acquiring
Person) that has the purpose or effect of avoiding the
provisions of this subsection 3.1(b) applicable in the
circumstances contemplated in clause (i) hereof;
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shall thereupon become and be void and any holder of such Rights (including any
Transferee) shall thereafter have no rights whatsoever with respect to such
Rights, whether under any provision of this Agreement or otherwise. The holder
of any Rights represented by a Rights Certificate which is submitted to the
Rights Agent, or any Co-Rights Agent, upon exercise or for registration of
transfer or exchange which does not contain the necessary certifications set
forth in the Rights Certificate establishing that such Rights are not void under
this subsection 3.1(b) shall be deemed to be an Acquiring Person for the
purposes of this subsection 3.1(b) and such rights shall be null and void.
(c) Any Rights Certificate that represents Rights Beneficially Owned
by a Person described in either clauses (i) or (ii) of subsection 3.1(b) hereof
or transferred to any nominee of any such Person, and any Rights Certificate
issued upon the transfer, exchange or replacement of any other Rights
Certificate referred to in this sentence shall contain the following legend:
"The Rights represented by this Rights Certificate were issued
to a Person who was an Acquiring Person or an Affiliate or an
Associate of an Acquiring Person (as such terms are defined in
the Rights Agreement) or was acting jointly or in concert with
any of them. This Rights Certificate and the Rights represented
hereby shall become void in the circumstances specified in
subsection 3.1(b) of the Rights Agreement."
PROVIDED, HOWEVER, that the Rights Agent shall not be under any responsibility
to ascertain the existence of facts that would require the imposition of such
legend but shall be required to impose such legend only if instructed to do so
by the Corporation or if a holder fails to certify upon transfer or exchange in
the space provided on the Rights Certificate that such holder is not an
Acquiring Person or an Affiliate or Associate thereof or acting jointly or in
concert with any of them. The issuance of a Rights Certificate without the
legend referred to in this subsection shall be of no effect on the provisions of
this subsection.
ARTICLE IV
THE RIGHTS AGENT
4.1 GENERAL
(a) The Corporation hereby appoints the Rights Agent to act as agent
for the Corporation and the holders of Rights in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Corporation may from time to time appoint one or more co-rights agents (each, a
"Co-Rights Agent") as it may deem necessary or desirable after consultation with
the Rights Agent. In such event, the respective duties of the Rights Agent and
any Co-Rights Agent shall be as the Corporation may determine with the written
approval of the Rights Agent. The Corporation agrees to pay to the Rights Agent
reasonable compensation for all services rendered by it hereunder and, from time
to time on demand of the Rights Agent, its reasonable expenses and counsel fees
and other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties hereunder. The
Corporation also agrees to indemnify the Rights Agent, its officers,
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directors, employees and agents for, and to hold them harmless against, any
loss, liability, cost, claim, action, damage, suit or expense, incurred without
negligence, bad faith or wilful misconduct on the part of the Rights Agent, its
officers, directors, employees or agents, for anything done or omitted by them
in connection with the acceptance and performance of this Agreement, including
legal costs and expenses, which right to indemnification shall survive the
termination of this Agreement or the resignation or removal of the Rights Agent.
In the event of any disagreement arising regarding the terms of this Agreement
the Rights Agent shall be entitled, at its option, to refuse to comply with any
and all demands whatsoever until the dispute is settled either by written
agreement amongst the parties to this Agreement or by a court of competent
jurisdiction.
(b) The Rights Agent shall be protected from, and shall incur no
liability for or in respect of, any action taken, suffered or omitted by it in
connection with its performance of this Agreement in reliance upon any
certificate for Shares, Rights Certificate, certificate for other securities of
the Corporation, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
opinion, statement or other paper or document believed by it to be genuine and
to be signed, executed and, where necessary, verified or acknowledged, by the
proper Person or Persons.
(c) The Corporation shall inform the Rights Agent in a reasonably
timely manner of events which may materially affect the administration of this
Agreement by the Rights Agent and, at any time upon written request, shall
provide to the Rights Agent an incumbency certificate certifying the then
current officers of the Corporation.
4.2 MERGER OR AMALGAMATION OR CHANGE OF NAME OF RIGHTS AGENT
(a) Any body corporate into which the Rights Agent or any successor
Rights Agent may be merged or amalgamated with or into, or any body corporate
succeeding to the securityholder services business of the Rights Agent or any
successor Rights Agent shall be the successor to the Rights Agent under this
Agreement without the execution or filing of any paper or any further act on the
part of any of the parties hereto, provided that such body corporate would be
eligible for appointment as a successor Rights Agent under the provisions of
Section 4.4 hereof.
In case at the time such successor Rights Agent succeeds to the agency
created by this Agreement any of the Rights Certificates have been countersigned
but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any or the Rights
Certificates have not been countersigned, any successor Rights Agent may
countersign such Rights Certificates either in the name of the predecessor
Rights Agent or in the name of the successor Rights Agent; and in all such cases
such Rights Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent is changed and
at such time any of the Rights Certificates shall have been countersigned but
not delivered, the Rights Agent may adopt the countersignature under its prior
name and deliver Rights Certificates so countersigned; and in case at that time
any of the Rights Certificates shall not have been countersigned, the
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Rights Agent way countersign such Rights Certificates either in its prior name
or in ifs changed name; and in all such cases such Rights Certificates shall
have the full force provided in the Rights Certificates and in this Agreement.
4.3 DUTIES OF RIGHTS AGENT
The Rights Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the
Corporation and the holders of Rights Certificates, by their acceptance thereof,
shall be bound:
(a) The Rights Agent may retain and consult with legal counsel (who
may be legal counsel for the Corporation), and the opinion of
such counsel will be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement
the Rights Agent deems it necessary or desirable that any fact
or matter be proved or established by the Corporation prior to
taking or suffering any action or refraining from taking any
action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed
to be conclusively proved and established by a certificate
signed by an individual believed by the Rights Agent to be the
Chairman, the Chief Executive Officer, the Chief Financial
Officer or any Vice-President and by the Secretary or any
Assistant Secretary of the Corporation and delivered to the
Rights Agent; and such certificate shall be full authorization
to the Rights Agent for any action taken, omitted or suffered in
good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own
negligence, bad faith or wilful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement
or in the certificates for Shares or the Rights Certificates
(except its countersignature thereof) or be required to verify
the same, but all such statements and recitals are and will be
deemed to have been made by the Corporation only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and
delivery hereof (except the due authorization, execution and
delivery hereof by the Rights Agent) or in respect of the
validity or execution of any Share certificate or Rights
Certificate (except its countersignature thereof); nor will it
be responsible for any breach by the Corporation of any covenant
or condition contained in this Agreement or in any Rights
Certificate; nor will it be responsible for any change in the
exercisability of the Rights (including the Rights becoming void
pursuant to subsection 3.1(b) hereof) or any adjustment required
under the provisions of Section 2.3 hereof or responsible for
the manner, method or amount of any such adjustment or the
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ascertaining of the existence of facts that would require any
such adjustment (except with respect to the exercise of Rights
after receipt of the certificate contemplated by Section 2.3
hereof describing any such adjustment); nor will it by any act
hereunder be deemed to make any representation or warranty as to
the authorization or reservation of any Shares to be issued
pursuant to this Agreement or any Rights or as to whether any
Shares shall, when issued, he duly and validly authorized,
executed, issued and delivered and be fully paid and
non-assessable.
(f) The Corporation agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized to rely upon and directed
to accept written instructions with respect to the performance
of its duties hereunder from any individual believed by the
Rights Agent to be the Chairman, the Chief Executive Officer,
the Chief Financial Officer or any Vice-President or the
Secretary or any Assistant Secretary of the Corporation, and to
apply to such individuals for advice or instructions in
connection with its duties, and it shall not be liable for any
action taken, omitted or suffered by it in good faith in
accordance with instructions of any such individual.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in Shares,
Rights or other securities of the Corporation or become
pecuniarily interested in any transaction in which the
Corporation may be interested, or contract with or lend money to
the Corporation or otherwise act as fully and freely as though
it were not Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent front acting in any other
capacity for the Corporation or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either
itself or by or through its attorneys or agents, and the Rights
Agent shall not be answerable or accountable for any act,
default, neglect or misconduct of any such attorneys or agents
or for any loss to the Corporation resulting from any such act,
omission, default, neglect or misconduct, provided reasonable
care was exercised in the selection and continued employment
thereof.
4.4 CHANGE OF RIGHTS AGENT
The Rights Agent may resign and be discharged from its duties under this
Agreement upon 60 days' notice (or such lesser notice as is acceptable to the
Corporation) in writing delivered or mailed to the Corporation and to each
transfer agent of Shares by first class mail, and mailed or delivered to the
holders of the Rights in accordance with Section 5.9 hereof. The Corporation may
remove the Rights Agent upon 60 days' notice in writing, mailed or delivered to
the Rights Agent and to each transfer agent of the Shares by first class mail,
and mailed to the
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holders of the Rights in accordance with Section 5.9 hereof. If the Rights Agent
should resign or be removed or otherwise become incapable of acting, the
Corporation shall appoint a successor to the Rights Agent. If the Corporation
fails to make such appointment within a period of 30 days after such removal or
after it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of any Rights (which
holder shall, with such notice, submit such holder's Rights Certificate for
inspection by the Corporation), then the holder of any Rights may apply, at the
Corporation's expense, to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether appointed
by the Corporation or by such a court, shall be a body corporate incorporated
under the laws of Canada or a province thereof and authorized to carry on
business in the Province of Ontario. After appointment, the successor Rights
Agent shall be vested with the same powers, rights, duties and responsibilities
as if it had been originally named as Rights Agent without further act or deed;
but the predecessor Rights Agent upon receipt of all fees and expenses
outstanding to the predecessor Rights Agent by the Corporation shall deliver and
transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose. Not later than the effective date of any such
appointment, the Corporation shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Shares, and mail a
notice thereof in writing to the holders of the Rights. Failure to give any
notice provided for in this Section 4.4, however, or any defect therein, shall
not affect the legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the case may be.
ARTICLE V
MISCELLANEOUS
5.1 REDEMPTION AND WAIVER
The Corporation shall give prompt written notice to the Rights Agent of
any waiver of the application of Section 3.1 made by the Board of Directors
acting in good faith under this Section 5.1. In addition,
(a) With the prior consent of the holders of Common Shares or Rights
obtained in accordance with subsection 5.4(b) or (c), as
applicable, the Board of Directors, at any time prior to the
occurrence of a Flip-in Event as to which the application of
Section 3.1 has not been waived pursuant to this Section 5.1,
may elect to redeem all but not less than all of the then
outstanding Rights at a redemption price of $0.00001 per Right
appropriately adjusted in a manner analogous to the applicable
adjustment to the Exercise Price provided for in Section 2.3
hereof if an event analogous to any of the events described in
Section 2.3 shall have occurred (such redemption price being
herein referred to as the "Redemption Price").
(b) With the prior consent of the holders of Common Shares obtained
in accordance with subsection 5.4(b), the Board of Directors
may, at any time prior to the
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occurrence of a Flip-in Event as to which the application of
Section 3.1 has not been waived pursuant to this Section 5.1, if
such Flip-in Event would occur by reason of an acquisition of
Common Shares otherwise than pursuant to a Take-over Bid made by
means of a Take-over Bid circular to all holders of record of
Common Shares and otherwise than in the circumstances set forth
in subsection 5.1(d), waive the application of Section 3.1 to
such Flip-in Event. In such event, the Board of Directors shall
extend the Separation Time to a date at least 10 Business Days
subsequent to the meeting of shareholders called to approve such
waiver.
(c) Prior to the occurrence of a Flip-in Event, as to which the
application of Section 3.1 has not been waived pursuant to this
paragraph, upon written notice to the Rights Agent, the Board of
Directors may waive the application of Section 3.1 to such
Flip-in Event but only if such Flip-in Event occurs as a result
of a Take-over Bid made by way of a Take-over Bid circular sent
to all holders of record of Common Shares; PROVIDED, HOWEVER,
that if the Board of Directors waives the application of Section
3.1 to a particular Flip-in Event, the Board of Directors shall
be deemed to have waived the application of Section 3.1 to any
other Flip-in Event occurring by reason of any Take-over Bid
which is made by means of a Take-over Bid circular to all
holders of record of Common Shares (i) prior to the granting of
such a waiver, or (ii) thereafter and prior to the expiry of any
Take-over Bid in respect of which a waiver is, or is deemed to
have been, granted under this subsection 5.1(c).
(d) The Board of Directors may waive the application of Section 3.1
to a Flip-in Event provided that the following conditions are
satisfied:
(i) the Board of Directors has determined that the Acquiring
Person became an Acquiring Person by inadvertence and
without any intention to become, or knowledge that it
would become, an Acquiring Person; and
(ii) such Acquiring Person has reduced its Beneficial
Ownership of Common Shares such that at the time of the
waiver pursuant to this subsection 5.1(d), it is no
longer an Acquiring Person.
(e) If a Person acquires, pursuant to a Permitted Bid or a Competing
Permitted Bid or pursuant to an Exempt Acquisition occurring
under subsection 5.1(c) hereof, more than 50% of the outstanding
Common Shares other than Common Shares Beneficially Owned at the
date of such Permitted Bid, Competing Permitted Bid or Exempt
Acquisition by such Person, the Board of Directors of the
Corporation shall, notwithstanding the provisions of subsection
5.1(a) hereof, immediately upon such acquisition and without
further formality be deemed to have elected to redeem the Rights
at the Redemption Price.
(f) If the Board of Directors elects to or is deemed to have elected
to redeem the Rights and, in circumstances where subsection
5.1(a) is applicable, the requisite consent is given by the
holders of Common Shares or Rights, as applicable, (i) the
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right to exercise the Rights will thereupon, without further
action and without notice, terminate and the only right
thereafter of the holders of Rights shall be to receive the
Redemption Price, and (ii) no further Rights shall thereafter be
issued.
(g) Within 10 Business Days of the Board of Directors electing or
having been deemed to have elected to redeem the Rights or, if
subsection 5.1(a), is applicable, within 10 Business Days after
the requisite consent being given by the holders of Common
Shares or Rights, as applicable, the Corporation shall give
notice of redemption to the holders of the then outstanding
Rights by mailing such notice to each such holder at his last
address as it appears upon the Rights Register of the Rights
Agent, or, prior to the Separation Time, on the share register
maintained by the Corporation's transfer agent. Each such notice
of redemption shall state the method by which the payment of the
Redemption Price shall be made.
(h) Where a Take-over Bid that is not a Permitted Bid or Competing
Permitted Bid expires, is withdrawn or otherwise terminated
after the Separation Time has occurred and prior to the
occurrence of a Flip-in Event, the Board of Directors may elect
to redeem all of the outstanding Rights at the Redemption Price.
(i) The Corporation shall give prompt written notice to the Rights
Agent of any waiver of the application of Section 3.1 made by
the Board of Directors under this Section 5.1.
(j) Upon the rights being redeemed pursuant to section 5.1(h), all
the provisions of this Agreement shall continue to apply as if
the Separation Time had not occurred and Rights Certificates
representing the number of Rights held by each holder of record
of Common Shares as of the Separation Time had not been mailed
to each such holder and for all purposes of this Agreement, the
Separation Time shall be deemed not to have occurred.
5.2 EXPIRATION
No Person shall have any rights pursuant to this Agreement or any Right
after the Expiration Time, except as provided in Section 4.1 hereof.
5.3 ISSUANCE OF NEW RIGHTS CERTIFICATES
Notwithstanding any of the provisions of this Agreement or of the Rights
to the contrary, the Corporation may, at its option, issue new Rights
Certificates evidencing Rights in such form as may be approved by the Board of
Directors to reflect any adjustment or change in the number or kind or class of
Shares purchasable upon exercise of Rights made in accordance with the
provisions of this Agreement.
5.4 SUPPLEMENTS AND AMENDMENTS
(a) The Corporation may make, without the approval of the holders of
Rights or Common Shares, any supplements or amendments to this Agreement (i)
specifically contemplated in subsections 2.10(f) or any other provision hereof,
(ii) to correct any clerical or
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typographical error, or (iii) which are required to maintain the validity and
effectiveness of the Agreement as a result of any change in any applicable laws,
rules or regulatory requirements. The Corporation may, prior to the date of any
shareholders meeting referred to in Section 5.17, supplement, amend, vary or
delete any of the provisions of this Agreement without the approval of any
holder of Rights or Common Shares (whether or not such action would materially
adversely affect the interests of the holders of Rights generally), where the
Board of Directors deems (in good faith) such action necessary or desirable.
Notwithstanding anything in this Section 5.4 to the contrary, no amendment shall
be made to the provisions of Article IV except with the written concurrence of
the Rights Agent to such supplement or amendment.
(b) Subject to subsection 5.4(a), the Corporation, with the prior
consent of the holders of Common Shares obtained as set forth below, at any time
before the Separation Time, may redeem Rights pursuant to subsection 5.1(a),
waive a Flip-in Event pursuant to subsection 5.1(b) or otherwise amend, vary or
rescind any of the provisions of this Agreement and the Rights (whether or not
such action would materially adversely affect the interests of the holders of
Rights generally). Such consent shall be deemed to have been given if provided
by the holders of Common Shares at a special meeting called and held in
compliance with applicable laws, rules and regulatory requirements and the
requirements in the articles and by-laws of the Corporation. Subject to
compliance with any requirements imposed by the foregoing, consent shall he
given if the proposed amendment, variation or rescission is approved by the
affirmative vote of a majority of the votes cast by all Independent Shareholders
represented in person or by proxy at the special meeting.
(c) The Corporation, with the prior consent of the holders of Rights
obtained as set forth below, at any time after the Separation Time and before
the Expiration Time, may redeem Rights pursuant to subsection 5.1(a) or
otherwise amend, vary or rescind any of the provisions of this Agreement and the
Rights (whether or not such action would materially adversely affect the
interests of the holders of Rights generally). Such consent shall be deemed to
have been given if provided by the holders of Rights at a special meeting of
holders of Rights called and held in compliance with applicable laws, rules and
regulatory requirements and, to the extent possible, with the requirements in
the articles and by-laws of the Corporation applicable to meetings of holders of
Common Shares, applied MUTATIS MUTANDIS. Subject to compliance with any
requirements imposed by the foregoing, consent shall be given if the proposed
amendment, variation or rescission is approved by the affirmative vote of a
majority of the votes cast by holders of Rights (other than holders of Rights
whose Rights have become null and void pursuant to subsection 3.1(b)),
represented in person or by proxy at the special meeting.
(d) Any amendments made by the Corporation to this Agreement
pursuant to subsection 5.4(a) which are required to maintain the validity and
effectiveness of this Agreement as a result of any change in any applicable
laws, rules or regulatory requirements shall:
(i) if made before the Separation Time, be submitted to the
holders of Common Shares at the next meeting of
shareholders and the shareholders may, by the majority
referred to in subsection 5.4(b), confirm or reject such
amendment;
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(ii) if made after the Separation Time, be submitted to the
holders of Rights at a meeting to be called in
accordance with the provisions of Section 5.4(c) hereof.
(e) The Corporation shall be required to provide the Rights Agent
with notice in writing of any such amendment, rescission or variation to this
Agreement as referred to in this Section 5.4 within five days or effecting such
amendment, rescission or variation.
Any such amendment shall, unless the Board of Directors otherwise
stipulates, be effective from the date of the resolution of the Board of
Directors adopting such amendment, until it is confirmed or rejected or until it
ceases to be effective (as described in the next sentence) and, where such
amendment is confirmed, it continues in effect in the form so confirmed. If such
amendment is rejected by the shareholders of the Corporation or the holders of
Rights or is not submitted to the shareholders of the Corporation or holders of
Rights as required, then such amendment shall cease to be effective from and
after the termination of the meeting at which it was rejected or to which it
should have been but was not submitted or if such a meeting of the holders of
Rights is not called within a period of 90 days of the making of any such
agreement, at the end of such period, and no subsequent resolution of Board of
Directors to amend this Agreement to substantially the same effect shall be
effective until confirmed by the shareholders of the Corporation or holders of
Rights as the case may be.
5.5 FRACTIONAL RIGHTS AND FRACTIONAL COMMON SHARES
(a) The Corporation shall not be required to issue fractions of
Rights or to distribute Right Certificates which evidence fractional Rights. In
lieu of issuing fractional Rights, the Corporation shall pay to the registered
holders of the Right Certificates, at the time such fractional Rights would
otherwise be issuable, an amount in cash equal to the same fraction of the
Market Price of one whole Right that the fraction of a Right that would
otherwise be issuable is of one whole Right. The Rights Agent shall have no
obligation to make any payments in lieu of fractional Rights unless the
Corporation shall have provided the Rights Agent with the necessary funds to pay
in full all amounts payable in accordance with Section 2.2(e). The Rights Agent
shall have no obligation to make any payments in lieu of fractional Rights
unless the Corporation shall have provided the Rights Agent with the necessary
funds to pay in full all amounts payable in accordance with Section 2.2(e).
(b) The Corporation shall not be required to issue fractions of
Common Shares upon exercise of the Rights or to distribute certificates which
evidence fractional Common Shares. In lieu of issuing fractional Common Shares,
the Corporation shall pay to the registered holders of Right Certificates at the
time such Rights are exercised as herein provided, an amount in cash equal to
the same fraction of the Market Price of one Common Share that the fraction of a
Common Share that would otherwise be issuable upon the exercise of such Right is
of a whole Common Share. The Rights Agent shall have no obligation to make any
payments in lieu of fractional Common Shares unless the Corporation shall have
provided the Rights Agent with the necessary funds to pay in full all amounts
payable in accordance with Section 2.2(e).
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5.6 RIGHTS OF ACTION
Subject to the terms of this Agreement, rights of action in respect of
this Agreement, other than rights of action vested solely in the Rights Agent,
are vested in the respective holders of the Rights, and any holder of any
Rights, without the consent of the Rights Agent or of the holder of any other
Rights may, on such holder's own behalf and for such holder's own benefit and
the benefit of other holders of Rights, enforce, and may institute and maintain
any suit, action or proceeding against the Corporation to enforce, or otherwise
act in respect of, such holder's right to exercise such holder's Rights in the
manner provided in such holder's Rights Certificate and in this Agreement.
Without limiting the foregoing or any remedies available to the holders of
Rights, it is specifically acknowledged that the holders of Rights would not
have an adequate remedy at law for any breach of this Agreement and will be
entitled to specific performance of the obligations under, and injunctive relief
against actual or threatened violations of the obligations of any Person subject
to, this Agreement.
5.7 HOLDER OF RIGHTS NOT DEEMED A SHAREHOLDER
No holder, as such, of any Rights shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of Common Shares or any other
securities which may at any time be issuable on the exercise of such Rights, nor
shall anything contained herein or in any Rights Certificate be construed to
confer upon the holder of any Rights, as such, any of the rights of a
shareholder of the Corporation or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as provided in Section
5.8 hereof), or to receive dividends or subscription rights, or otherwise, until
such Rights shall have been exercised in accordance with the provisions hereof.
5.8 NOTICE OF PROPOSED ACTIONS
If after the Separation Time and prior to the Expiration Time:
(i) there shall occur an adjustment in the Rights attaching to the
Rights pursuant to Section 3.1 as a result of the occurrence of
a Flip-in Event; or
(ii) the Corporation proposes to effect the liquidation, dissolution
or winding up of the Corporation or the sale of all or
substantially all of the Corporation's assets;
then, in each such case, the Corporation shall give to each holder of a Right,
in accordance with Section 5.9, a notice of such event or proposed action, which
shall specify the date on which such change to the Rights, liquidation,
dissolution or winding up occurred or is to take place, and such notice shall be
so given within 10 Business Days after the occurrence of a change to the Rights
and not less than 20 Business Days prior to the date of taking such proposed
action by the Corporation.
5.9 NOTICES
Any notice, demand or other communication required or permitted to be
given or made by the Rights Agent or by the holder of any Rights to or on the
Corporation or by the Corporation or by the
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holder of any Rights to or on the Rights Agent shall be in writing and shall be
well and sufficiently given or made if:
(i) delivered in person during normal business hours on a Business
Day and left with the receptionist or other responsible employee
at the relevant address set forth below; or
(ii) except during any general interruption of postal services due to
strike, lockout or other cause, sent by first-class mail; or
(iii) sent by telegraph, facsimile or other form of recorded
electronic communication, charges prepaid and confirmed in
writing as aforesaid;
if to the Corporation, addressed to it at:
Kinross Gold Corporation
Scotia Plaza, 00 Xxxx Xxxxxx Xxxx
00xx Xxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: Xxxxxxx Xxxxx,
Vice President, Administration and
Corporate Secretary
Fax No.: 000-000-0000
and if to the Rights Agent, addressed to it at:
Computershare Investor Services Inc.
000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: Xxxx Xxxxx
Fax No.: 000-000-0000
Notices, demands or other communications required or permitted to be given or
made by the Corporation or the Rights Agent to or on the holder of any Rights
shall be in writing and shall be well and sufficiently given or made if
delivered personally to such holder or delivered or mailed by first class mail
to the address of such holder as it appears on the Rights Register maintained by
the Rights Registrar, or, prior to the Separation Time, in the register of
Shareholders maintained by the transfer agent for the Common Shares.
Any notice so given or made shall be deemed to have been given and to
have been received on the day of delivery, if so delivered; on the third
Business Day (excluding each day during which there exists any general
interruption of postal service due to strike, lockout, or other cause) following
the mailing thereof, if so mailed; and on the day of telegraphing, telecopying
or sending of the same by other means of recorded electronic communication
(provided such sending is during the normal business hours of the addressee on a
Business Day and if not, on the first Business Day thereafter). Each of the
Corporation and the Rights Agent
- 40 -
may from time to time change its address for notice by notice to the other given
in the manner aforesaid.
5.10 COSTS OF ENFORCEMENT
The Corporation agrees that if the Corporation fails to fulfill any of
its obligations pursuant to this Agreement, then the Corporation shall reimburse
the holder of any Rights for the costs and expenses (including reasonable legal
fees) incurred by such holder and actions to enforce his rights pursuant to any
Rights or this Agreement.
5.11 SUCCESSORS
All the covenants and provisions of this Agreement by or for the benefit
of the Corporation or the Rights Agent shall bind and inure to the benefit of
their respective successors and permitted assigns hereunder.
5.12 BENEFITS OF THIS AGREEMENT
Nothing in this Agreement shall be construed to give to any Person other
than the Corporation, the Rights Agent and the holders of the Rights any legal
or equitable right, remedy or claim under this Agreement; but this Agreement
shall be for the sole and exclusive benefit of the Corporation, the Rights Agent
and the holders of the Rights.
5.13 GOVERNING LAW
This Agreement and each Right issued hereunder shall be deemed to be a
contract made under the laws of the Province of Ontario and for all purposes
shall be governed by and construed in accordance with the laws of such Province
applicable to contracts to be made and performed entirely within such Province.
5.14 COUNTERPARTS
This Agreement may be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the same instrument.
5.15 SEVERABILITY
If any term or provision hereof or the application thereof to any
circumstance shall, in any jurisdiction and to any extent, be invalid or
unenforceable, such term or provision shall be ineffective as to such
jurisdiction to the extent of such invalidity or unenforceability without
invalidating or rendering unenforceable the remaining terms and provisions
hereof or the application of such term or provision to circumstances other than
those as to which it is held invalid or unenforceable.
- 41 -
5.16 DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS
The Board of Directors shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers specifically
granted to the Board of Directors, or as may be necessary or advisable in the
administration of this Agreement, including, without limitation, the right and
power to (i) interpret the provisions of this Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Agreement (including a determination to terminate or redeem or not to terminate
or redeem the Rights or to amend the Agreement). All such actions, calculations
and determinations (including all omissions with respect to the foregoing) which
are done or made by the Board of Directors, in good faith, shall not subject the
Board of Directors to any liability to the holders of the Rights.
5.17 EFFECTIVE DATE
This Agreement is effective in accordance with its terms from the date
hereof; provided that unless confirmed by ordinary resolution passed by a
majority of the votes cast by Independent Shareholders present in person or
voting by proxy and who vote in respect of confirmation of this Agreement at a
special meeting of shareholders of the Corporation to be held not later than
September 29, 2006, this Agreement shall be of no further force or effect and
all Rights issued hereunder shall be void from the first to occur of (i) the
termination of such meeting, and (ii) the Close of Business (Toronto time) on
September 29, 2006.
5.18 APPROVAL OF HOLDERS OF RIGHTS
If, after the Separation Time, the approval of holders of Rights is
required in respect of a supplement or amendment to this Agreement made pursuant
to Section 5.4 hereof, the Board of Directors shall, within 31 days after the
implementation of any such supplement or amendment, call a special meeting of
the holders of Rights to consider, and if thought fit, to pass a resolution
approving the supplement or amendment, and such supplement or amendment shall be
deemed to have been approved if such resolution receives the affirmative vote of
a majority of the votes cast by holders of Rights represented at the meeting in
person or by proxy excluding any Rights which are then void pursuant to the
provisions of subsection 3.1(b) hereof. In respect of any such meeting required
to be held:
(i) the Board of Directors shall fix a date for the meeting, which
date shall be as soon as practicable after the implementation of
any supplement or amendment requiring approval, but not more
than 110 days thereafter;
(ii) the Board of Directors of the Corporation shall fix a record
date for determining the holders of Rights entitled to receive
notice of such meeting in a manner analogous to the procedures
set out in National Instrument 54-101 of the Canadian Securities
Administrators (as such policy may be amended or replaced from
time to time, and as required in order to conform to the
requirements of any applicable securities legislation or policy)
and the rules of any stock exchange on which the Common Shares
are then listed, and the articles and by-laws of the
Corporation; and
- 42 -
(iii) each Right shall be entitled to one vote at such meeting and, in
all other respects, the rules applicable to meetings of
shareholders set forth in the articles and by-laws of the
Corporation shall apply in respect of such meeting of holders of
Rights, MUTATIS MUTANDIS.
5.19 DECLARATION AS TO NON-CANADIAN AND NON-UNITED STATES HOLDERS
If, upon the advice of outside counsel, any action or event contemplated
by this Agreement would require compliance with the securities laws or
comparable legislation of a jurisdiction outside of Canada and the United States
of America, the Board of Directors acting in good faith may take such actions as
it may deem appropriate to ensure that such compliance is not required,
including without limitation establishing procedures for the issuance to a
Canadian resident Fiduciary of Rights or securities issuable on exercise of
Rights, the holding thereof in trust for the Persons entitled thereto (but
reserving to the Fiduciary or to the Fiduciary and the Corporation, as the
Corporation may determine, absolute discretion with respect thereto) and the
sale thereof and remittance of the proceeds of such sale, if any, to the Persons
entitled thereto. In no event shall the Corporation or the Rights Agent be
required to issue or deliver Rights or securities issuable on exercise of Rights
to Persons who are citizens, residents or nationals of any jurisdiction other
than Canada and any province or territory thereof and the United States of
America and any state thereof in which such issue or delivery would be unlawful
without registration of the relevant Persons or securities for such purposes.
5.20 REGULATORY APPROVALS
Any obligation of the Corporation or action or event contemplated by
this Agreement, or any amendment or supplement to this Agreement, shall be
subject to receipt of any requisite approval or consent from any governmental or
regulatory authority having jurisdiction including the Toronto Stock Exchange
while any securities of the Corporation are listed and posted for trading
thereon and for a period of 6 months thereafter.
5.21 U.S. REGISTRATION
Notwithstanding anything to the contrary, no Rights shall be deemed
issued until a registration of the Rights under Section 12(b) of the U.S.
Securities Exchange Act of 1934, as amended, is effective, but, regardless of
when that registration shall become effective, the Rights shall be effective in
accordance with Section 2 in respect of each Common Share outstanding as the
Record Time and each Common Share that may be issued after the Effective Time
and prior to the earlier of the Separation Time and the Expiration Time.
5.22 TIME OF THE ESSENCE
Time shall be of the essence in this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written,
KINROSS GOLD CORPORATION
By:_____________________________________
By:_____________________________________
COMPUTERSHARE INVESTOR SERVICES INC.
By:_____________________________________
By:_____________________________________
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EXHIBIT "A"
[FORM OF RIGHTS CERTIFICATE]
CERTIFICATE NO.____________ ____________RIGHTS
THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE
CORPORATION, ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
UNDER CERTAIN CIRCUMSTANCES (SPECIFIED IN THE RIGHTS AGREEMENT),
RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR ANY PERSON
ACTING JOINTLY OR IN CONCERT WITH AN ACQUIRING PERSON OR WITH AN
ASSOCIATE OR AFFILIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE
DEFINED IN THE RIGHTS AGREEMENT) OR TRANSFEREES OF ANY OF THE
FOREGOING WILL BECOME VOID WITHOUT FURTHER ACTION.
RIGHTS CERTIFICATE
This certifies that , or registered assigns, is the
registered holder of the number of Rights set forth above, each of which
entities the registered holder thereof, subject to the terms, provisions and
conditions of a Rights Agreement made as of March 29, 2006 (the "Rights
Agreement") between KINROSS GOLD CORPORATION, a corporation amalgamated under
the BUSINESS CORPORATIONS ACT (Ontario) (the "Corporation"), and Computershare
Investor Services Inc.., as Rights Agent, to purchase from the Corporation at
any time after the Separation Time and prior to the Expiration Time (as such
terms are defined in the Rights Agreement), one fully paid common share in the
capital of the Corporation (a "Common Share") (subject to adjustment as provided
in the Rights Agreement) at the Exercise Price referred to below, upon
presentation and surrender of this Rights Certificate with a duly completed and
executed Form of Election to Exercise at the principal office of the Rights
Agent in any of the Cities of Toronto, Montreal, Winnipeg, Calgary or Vancouver,
Canada. The Exercise Price shall initially be $90 per Right and shall be subject
to adjustment in certain events as provided in the Rights Agreement.
This Rights Certificate is subject to all the terms, provisions and
conditions of the Rights Agreement which terms, provisions and conditions are
hereby incorporated herein by this reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Rights Agent, the Corporation and the holders of the Rights Certificates. Copies
of the Rights Agreement are on file at the registered office of the Corporation
and are available upon written request.
This Rights Certificate, with or without other Rights Certificates, upon
surrender at any office of the Rights Agent or any Co-Rights Agent designated
for such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing an aggregate number of Rights
equal to the aggregate number of Rights evidenced by the Rights Certificate or
Rights Certificates so surrendered. If this Rights Certificate shall be
exercised in
part, the registered holder shall be entitled to receive, upon surrender hereof,
another Rights Certificate or Rights Certificates for the number of whole Rights
not exercised.
Subject to the provision of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Corporation at a redemption price of
$0.00001 per Right.
No fractional Common Shares will be issued upon the exercise of any
Right or Rights evidenced hereby nor will Rights Certificates be issued for less
than one whole Right. In lieu thereof, a cash payment will be made as provided
in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of Common Shares or
of any other securities which may at any time be issuable on the exercise
hereof, nor shall anything contained in the Rights Agreement or herein be
construed to confer upon the holder hereof, as such, any of the rights of a
shareholder of the Corporation or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Rights evidenced by this Rights Certificate shall have been exercised
as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the
Corporation and its corporate seal.
Date:_____________________________
ATTEST: KINROSS GOLD CORPORATION
By:_____________________________________
By:_____________________________________
Countersigned:
COMPUTERSHARE INVESTOR SERVICES INC.
By:_______________________________
Authorized Signature
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[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificates.)
FOR VALUE RECEIVED _____________________________________________________________
hereby sells, assigns and transfers
unto ___________________________________________________________________________
________________________________________________________________________________
(Please print name and address of transferee)
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint ___________________________
Attorney, to transfer the within Rights Certificate on the books of the
within-named Corporation, with full power of substitution.
Dated:____________________________
Signature Guaranteed
________________________________________
Signature
(Signature must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any change
whatsoever)
(Signature must be guaranteed by a Canadian Schedule I chartered bank, or a
financial institution that is a member of a recognized Medallion Signature
Guarantee Program (STAMP).
________________________________________________________________________________
(To be completed if true)
CERTIFICATION
THE UNDERSIGNED HEREBY REPRESENTS AND CERTIFIES, FOR THE BENEFIT OF ALL
HOLDERS OF RIGHTS AND COMMON SHARES, THAT THE RIGHTS EVIDENCED BY THIS RIGHTS
CERTIFICATE ARE NOT, AND, TO THE KNOWLEDGE OF THE UNDERSIGNED, HAVE NOT BEEN,
BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR ANY PERSON ACTING JOINTLY OR IN
CONCERT WITH ANY ACQUIRING PERSON OR WITH ANY AFFILIATE OR ASSOCIATE THEREOF
(ALL AS DEFINED IN THE RIGHTS AGREEMENT).
________________________________________________________________________________
Signature
________________________________________________________________________________
NOTICE
IN THE EVENT THE CERTIFICATION SET FORTH ABOVE IS NOT COMPLETED IN
CONNECTION WITH A PURPORTED ASSIGNMENT, THE BENEFICIAL OWNER OF THE RIGHTS
EVIDENCED BY THIS RIGHTS CERTIFICATE WILL BE DEEMED TO BE AN ACQUIRING PERSON OR
A PERSON ACTING JOINTLY OR IN CONCERT WITH SUCH ACQUIRING PERSON OR AN AFFILIATE
OR ASSOCIATE OF SUCH ACQUIRING PERSON (ALL AS DEFINED IN THE RIGHTS AGREEMENT)
AND ACCORDINGLY THE RIGHTS EVIDENCED BY THIS RIGHTS CERTIFICATE WILL BE NULL AND
VOID.
[To be attached to each Rights Certificate]
FORM OF ELECTION TO EXERCISE
(To be executed if holder desires to
exercise the Rights Certificate.)
TO:
The undersigned hereby irrevocably elects to exercise
______________________ whole Rights represented by the attached Rights
Certificate to purchase the Shares issuable upon the exercise of such Rights and
requests that certificates for such Shares be issued in the name of:
________________________________________________________________________________
Address:
________________________________________________________________________________
________________________________________________________________________________
Social Insurance, Social Security or
Other Taxpayer Identification Number: __________________________________________
If such number of Rights shall not be all the whole Rights evidenced by this
Rights Certificate, a new Rights Certificate for the balance of such whole
Rights shall he registered in the name of and delivered to:
Address:
________________________________________________________________________________
________________________________________________________________________________
Social Insurance, Social Security or
Other Taxpayer Identification Number: __________________________________________
Dated:____________________________
Signature Guaranteed:
________________________________________
Signature
(Signature must correspond to name as
written upon the face of this Rights
Certificate in every particular, without
alteration or enlargement or any change
whatsoever)
(Signature must be guaranteed by a Canadian Schedule I chartered bank,
or a financial institution that is a member of a recognized Medallion Signature
Guarantee Program (STAMP).
________________________________________________________________________________
(TO BE COMPLETED IF TRUE)
CERTIFICATION
THE UNDERSIGNED HEREBY REPRESENTS, FOR THE BENEFIT OF SILL HOLDERS OF
RIGHTS AND SHARES, THAT THE RIGHTS EVIDENCED BY THIS RIGHTS CERTIFICATE ARE NOT,
AND, TO THE KNOWLEDGE OF THE UNDERSIGNED, HAVE NEVER BEEN, BENEFICIALLY OWNED BY
AN ACQUIRING PERSON OR ANY PERSON ACTING JOINTLY OR IN CONCERT WITH ANY
ACQUIRING PERSON OR WITH ANY AFFILIATE OR ASSOCIATE THEREOF (ALL AS DEFINED IN
THE RIGHTS AGREEMENT).
________________________________________
Signature
________________________________________________________________________________
NOTICE
IN THE EVENT THE CERTIFICATION SET FORTH ABOVE IS NOT COMPLETED IN
CONNECTION WITH A PURPORTED EXERCISE, THE BENEFICIAL OWNER OF THE RIGHTS
EVIDENCED BY THIS RIGHTS CERTIFICATE WILL BE DEEMED TO BE AN ACQUIRING PERSON OR
A PERSON ACTING JOINTLY OR IN CONCERT WITH AN ACQUIRING PERSON OR AN AFFILIATE
OR ASSOCIATE OF AN ACQUIRING PERSON (ALL AS DEFINED IN THE RIGHTS AGREEMENT) AND
ACCORDINGLY WILL DEEM THE RIGHTS EVIDENCED BY THIS RIGHTS CERTIFICATE WILL BE
NULL AND VOID.
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