AMALGAMATION AGREEMENT
THIS AMALGAMATION AGREEMENT dated as of the 20th of January, 2003.
B E T W E E N:
GENTERRA INVESTMENT CORPORATION, a corporation formed under the laws of the
Province of Ontario, (Ontario), (hereinafter referred to as "Genterra")
OF THE FIRST PART
- and -
MIRTRONICS INC., a corporation incorporated under the laws of the Province of
Ontario, (hereinafter referred as "Mirtronics") OF THE SECOND PART
THIS AGREEMENT WITNESSETH as follows:
ARTICLE ONE - DEFINITIONS
1.1 In this Agreement, the following terms shall have the following meanings,
respectively:
(a) "Act" means the Business Corporations Act (Ontario), as amended;
(b) "Agreement" means this Amalgamation Agreement and includes the
schedules attached hereto;
(c) "Amalgamation" means the amalgamation of the Amalgamating Corporations
as contemplated in the Agreement;
(d) "Amalgamating Corporations" means Genterra and Mirtronics;
(e) "Amalgamated Corporation" means the corporation continuing from the
amalgamation of the Amalgamating Corporations;
(f) "Articles of Amalgamation" means the Articles of Amalgamation
contemplated in section 6.1 hereof;
(g) "Certificate of Amalgamation" means the certificate of amalgamation to
be issued to the Amalgamated Corporation pursuant to the Act;
(h) "Effective Date" means the date on which the conditions to the
Amalgamation, and all steps to implement the Amalgamation as set forth
in this Agreement are taken and satisfied;
(i) "Genterra Class A Share" means a Class A subordinate voting
participating share without par value in the capital of Genterra;
(j) "Genterra Class B Share" means a Class B multiple voting participating
share without par value in the capital of Genterra;
(k) "Genterra Class D Series 1 Share" means a non-voting,
non-participating, non-cumulative, redeemable Class D preferred share,
Series 1 in the capital of Genterra;
(l) "Genterra Class D Series 2 Share" means a non-voting,
non-participating, non-cumulative, redeemable Class D preferred share,
Series 2 in the capital of Genterra;
(m) "Genterra Class E Share" means a non-voting, non-participating, $0.14
cumulative, redeemable Class E preferred share in the capital of
Genterra;
(n) "Genterra Class F Series 1 Share" means a non-voting,
non-participating, $0.06 cumulative, redeemable, convertible Class F
preferred share Series 1 in the capital stock of Genterra;
(o) "Genterra Series 1 Share" means a non-voting, non-participating,
$0.0084 cumulative, redeemable Series 1 Preference Share in the
capital stock of Genterra;
(p) "Genterra Special Share" means a voting, non-participating, redeemable
special share without par value in the capital of Genterra;
(q) "Genterra Warrant" means a warrant enabling the holder to purchase one
(1) Genterra Class A Share and 0.7 Genterra Series 1 Share at the
price of $0.28 per share prior to March 26, 2004;
(r) "Mirtronics Common Share" means a Common share without par value in
the capital of Mirtronics; and
(s) "Mirtronics Class B Preference Share" means a non-voting,
non-participating, remeedable, non-cumulative Class B Preference share
in the capital of Mirtronics.
ARTICLE TWO - AMALGAMATION
2.1 Agreement
The Amalgamating Corporations agree to amalgamate pursuant to the
provisions of the Act as of the Effective Date and to continue as one
corporation on the terms and conditions herein described.
2.2 Effective Date of Amalgamation
On the Effective Date that the Amalgamation becomes effective and the
Amalgamating Corporations are amalgamated and continue as one corporation under
the terms and conditions of this Agreement, the Amalgamated Corporation shall
possess all of the property, rights, privileges and franchises and shall be
subject to all of the liabilities, contracts, disabilities and debts of each of
the Amalgamating Corporations.
ARTICLE THREE - AMALGAMATED CORPORATION
3.1 Name
The name of the Amalgamated Corporation shall be Genterra Inc., or such
other name as may be approved.
3.2 Registered Office
The registered office of the Amalgamated Corporation shall be in the
Municipality of Metropolitan Toronto in the Province of Ontario. The address of
the registered office of the Amalgamated Corporation in the Municipality of
Metropolitan Toronto shall be 000 Xxxxxx Xxxx, Xxxxxxx, Xxxxxxx, X0X 0X0.
3.3 Directors
(a) Number:
The board of directors of the Amalgamated Corporation shall, until
otherwise changed in accordance with the Act, consist of a minimum of three (3)
and a maximum of fifteen (15) directors;
(b) First Directors:
The first directors of the Amalgamated Corporation shall be the persons
whose names and addresses appear below:
Full Name Residence Address
Xxxx X. Xxxxxx 00 Xxxxxx Xxxxxxxx, Xxxxxxx, Xxxxxxx, X0X 0X0
Xxxxxx Xxxxxx 000 XxXxxxxx Xxxxxxxx, Xxxxxxxxx, Xxxxxxx, X0X 0X0
Xxxxx Xxxxxx 0 Xxxxx Xxxxxx Xxxx, Xxxxx Xxxx, Xxxxxxx, X0X 0X0
Xxxx Xxxxxxxxxx 00 Xxxxxx Xxxx, Xxxxxxxxx, Xxxxxxx, X0X 0X0
Xxxx Xxxxxxxx 0 Xxxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxx, X0X 0X0
Each of the foregoing is a resident Canadian. The said first directors shall
hold office until their successors are elected or appointed. The election of the
subsequent directors shall take place yearly at the annual meeting of
shareholders of the Amalgamated Corporation and shall be by a show of hands
unless a ballot is demanded by a shareholder, in accordance with s.103 of the
Act.
3.4 Business
There shall be no restrictions on the business that the Amalgamated
Corporation may carry on.
3.5 Authorized Capital
(a) The authorized share capital of the Amalgamated Corporation shall
consist of:
(i) an unlimited number of Class A subordinate voting participating
shares without par value (the "Class A Shares");
(ii) an unlimited number of Class B multiple voting participating
shares without par value (the "Class B Shares");
(iii)an unlimited number of preference shares without par value (the
"Class C Preferred Shares");
(iv) an unlimited number of preferred shares without par value
issuable in series (the "Class D Preferred Shares");
(v) an unlimited number of preferred shares without par value (the
"Class E Preferred Shares);
(vi) an unlimited number of preferred shares without par value
issuable in series (the "Class F Preferred Shares);
(vii)an unlimited number of preference shares without par value (the
"Series 1 Preference Shares"); and
(viii) an unlimited number of special shares without par value (the
"Special Shares").
(b) The rights, privileges, restrictions and conditions attaching to the
Class A Shares and the Class B Shares are set out in Exhibit "1"
annexed hereto.
(c) The rights, privileges, restrictions and conditions attaching to the
Class C Preferred Shares (the "Class C Preferred Shares") are set out
in Exhibit "2" annexed hereto.
(d) The rights, privileges, restrictions and conditions attaching to the
Class D Preferred Shares and to the first and second series thereof
(the "Class D Preferred Shares, Series 1", and the "Class D Preferred
Shares, Series 2") are set out in Exhibit "3" annexed hereto.
(e) The rights, privileges, restrictions and conditions attaching to the
Class E Preferred Shares are set out in Exhibit "4" annexed hereto.
(f) The rights, privileges, restrictions and conditions attaching to the
Class F Preferred Shares, and to the first series thereof (the "Class
F Preferred Shares, Series 1") are set out in Exhibit "5" annexed
hereto.
(g) The rights, privileges, restrictions and conditions attaching to the
Series 1 Preference Shares are set out in Exhibit "6" annexed hereto.
(h) The rights, privileges, restrictions and conditions attaching to the
Special Shares are set out in Exhibit "7" annexed hereto.
3.6 Restrictions on Transfer
There shall be no restrictions on the issue, transfer or ownership of
shares of the Amalgamated Corporation.
3.7 By-laws
The by-laws of Genterra shall, to the extent not inconsistent with this
Agreement, be the by-laws of the Amalgamated Corporation. A copy of such by-laws
may be examined at 000 Xxxxxx Xxxx, Xxxxxxx, Xxxxxxx, X0X 0X0.
ARTICLE FOUR -
ISSUE OF SHARES BY THE AMALGAMATED CORPORATION
4.1 Issue of Shares
The shares in the capital of the Amalgamating Corporations which are issued
and outstanding immediately prior to the date of the issuance of a Certificate
of Amalgamation pursuant to the provisions of the Act shall, on and from such
last mentioned date, be converted into issued and outstanding shares in the
capital of the Amalgamated Corporation as follows:
(a) the 4,865,187 issued and outstanding Genterra Class A Shares shall be
converted into an aggregate of 4,865,187 issued and fully paid Class A
Shares of the Amalgamated Corporation, on a one for one basis;
(b) the 484,012 issued and outstanding Genterra Class B Shares shall be
converted into an aggregate of 484,012 issued and fully paid Class B
Shares of the Amalgamated Corporation, on a one for one basis;
(c) the 2,475,009 issued and outstanding Genterra Class D Series 1 Shares
shall be converted into an aggregate of 2,475,009 issued and fully
paid Class D Preferred Shares Series 1 of the Amalgamated Corporation,
on a one for one basis;
(d) the 810,059 issued and outstanding Genterra Class D Series 2 Shares
shall be converted into an aggregate of 810,059 issued and fully paid
Class D Preferred Shares, Series 2 of the Amalgamated Corporation, on
a one for one basis;
(e) the 115,258 issued and outstanding Genterra Class E Shares shall be
converted into an aggregate of 115,258 issued and fully paid Class E
Preferred Shares of the Amalgamated Corporation, on a one for one
basis;
(f) the 500,000 issued and outstanding Genterra Class F Shares shall be
converted into an aggregate of 610,000 issued and fully paid Class F
Preferred Shares of the Amalgamated Corporation, on the basis of 1.22
Class F Preferred Shares for each one Genterra Class F Share;
(g) the 1,935,292 issued and outstanding Genterra Series 1 Shares shall be
converted into an aggregate of 1,935,292 issued and fully paid Series
1 Preference Shares of the Amalgamated Corporation, on a one for one
basis;
(h) the 500,000 issued and outstanding Genterra Special Shares shall be
converted into an aggregate of 500,000 issued and fully paid Special
Shares of the Amalgamated Corporation, on a one for one basis;
(i) the 712,500 issued and outstanding Genterra Warrants shall be
converted into an aggregate of 712,500 issued warrants of the
Amalgamated Corporation, on a one for one basis;
(j) the 12,867,581 issued and outstanding Mirtronics Common Shares shall
be converted into an aggregate of 16,084,476 issued and fully paid
Class A Shares of the Amalgamated Corporation, on the basis of 1.25
Class A Shares for each one Mirtronics Common Share;
(k) the 1,709,115 issued and outstanding Mirtronics Class B Preferred
Shares shall be converted into an aggregate of 1,709,115 issued and
fully paid Class C Preferred Shares of the Amalgamated Corporation, on
a one for one basis; and
(l) each option granted by Mirtronics to purchase Mirtronics Common Shares
pursuant to the Mirtronics Stock Option Plan, shall be cancelled.
4.2 Stated Capital
The stated capital of the Amalgamated Corporation shall be equal to the
aggregate of the stated capitals of the Amalgamating Corporations immediately
prior to the Amalgamation becoming effective.
4.3 Fractional Shares
No fractional shares of the Amalgamated Corporation will be issued.
Shareholders who are entitled to a fraction of a share will receive a full share
in respect thereof.
ARTICLE FIVE -
CONDITIONS PRECEDENT TO AMALGAMATION
5.1 Conditions Precedent to Amalgamation
Notwithstanding anything to the contrary contained herein, the respective
obligations of Genterra and Mirtronics to complete the transactions contemplated
by this agreement and to file Articles of Amalgamation to give effect to the
Amalgamation shall be subject to the satisfaction of the following conditions:
(a) this Agreement, with or without amendment, shall have been adopted and
approved by special resolutions passed at special meetings of the
shareholders of each of Genterra and Mirtronics, both called and held
in accordance with the provisions of applicable laws, and in addition
by a majority of the votes cast by shareholders other than Xxxx X..
Xxxxxx and his respective associates;
(b) all other consents, orders, regulations and approvals, including
regulatory approvals and orders, required or necessary or desirable
for the completion of the transactions provided for in this agreement
shall have been obtained or received from the persons, authorities or
bodies having jurisdiction in the circumstances;
(c) there shall not be in force any order or decree restraining or
enjoining the consummation of the transactions contemplated by this
agreement; and
(d) none of the consents, orders, regulations or approvals contemplated
herein shall contain terms or conditions or require undertakings or
securities deemed unsatisfactory or unacceptable by the parties
hereto.
ARTICLE SIX -
ARTICLES OF AMALGAMATION
6.1 Filing
Upon the directors and shareholders of each of the Amalgamating
Corporations approving this Agreement by special resolution in accordance with
the Act, and all other conditions to the Amalgamation being satisfied, the
Amalgamating Corporations shall jointly file with the Director under the Act,
Articles of Amalgamation and such other documents as may be required for the
purpose of giving effect to the Amalgamation.
6.2 Termination
This Agreement may, prior to the endorsement of the Certificate of
Amalgamation, be terminated by resolution of the board of directors of either of
the Amalgamating Corporations notwithstanding the approval of this Agreement by
the shareholders of both of the Amalgamating Corporations, at any time prior to
the endorsement of a Certificate of Amalgamation under the Act insofar as this
Agreement relates to the Amalgamating Corporation in question.
6.3 Amendments
This Agreement may, prior to the endorsement of the Certificate of
Amalgamation, be amended by resolution of the board of directors of each of the
Amalgamating Corporations, without further approval of the shareholders of each
of the Amalgamating Corporations.
ARTICLE SEVEN - GENERAL
7.1 Assets and Liabilities
The Amalgamated Corporation shall possess all the property, rights,
privileges and franchises, as they exist immediately before the Amalgamation,
and shall be subject to all the liabilities, including civil, criminal and
quasi-criminal, and all contracts, disabilities and debts of each of the
Amalgamating Corporations, as they exist immediately before the Amalgamation.
7.2 Registrar and Transfer Agent
The registrar and transfer agent for the shares of the Amalgamated
Corporation shall be Computershare Trust Company of Canada, at its principal
office in the City of Toronto.
7.3 Auditors
The auditors of the Amalgamated Corporation shall be Kraft, Xxxxxx Grill,
Xxxxxxxx. Xxxxx & March LLP, Chartered Accountants.
7.4 Fiscal Year End
The fiscal year end of the Amalgamated Corporation shall be September 30,
in each year, commencing September 30, 2003, until changed by resolution of the
board of directors.
7.5 Modifications
Each of the Amalgamating Corporations may, by special resolution (as
defined in the Act) of each of them, assent to any alteration or modification of
this Agreement.
7.6 Governing Law
This Agreement shall be governed by and construed in accordance with the
laws of the Province of Ontario.
7.7 Execution in Counterpart
This Agreement may be executed in counterparts all of which taken together
shall constitute this Agreement.
7.8 Entire Agreement
This Agreement constitutes the entire agreement among the parties relating
to the subject matter hereof and supersedes all prior agreements and
understandings, oral and written between the parties thereto with respect to the
subject matter hereof.
IN WITNESS WHEREOF this Amalgamation Agreement has been executed by the parties
hereto.
GENTERRA INVESTMENT CORPORATION
By:
Secretary
MIRTRONICS INC.
By:
Secretary
