RADIANT ENERGY CORPORATION
(the "Company")
and
RADIANT AVIATION SERVICES, INC.
(the "Guarantor")
and
THE TRUST COMPANY OF BANK OF MONTREAL
(the "Trustee")
-----------------------------------------
TRUST INDENTURE
-----------------------------------------
$2,350,000
7% Redeemable Convertible Secured Subordinated Debentures
Due May 31, 2004
As of May 28, 1999
XXXXXXXXX XXXX XXXXXXX APPS & DELLELCE
BLAKE, XXXXXXX & XXXXXXX
TABLE OF CONTENTS
ARTICLE 1 INTERPRETATION.....................................................2
1.01 Definitions..........................................................2
1.02 Number and Gender....................................................5
1.03 Choice of Language...................................................5
1.04 Business Day.........................................................6
1.05 Headings.............................................................6
1.06 Meaning of "Outstanding".............................................6
1.07 Time of the Essence..................................................7
1.08 Applicable Law.......................................................7
1.09 Currency.............................................................7
ARTICLE 2 THE DEBENTURES.....................................................7
2.01 Limit of Issue.......................................................7
2.02 Designation, Interest and Maturity...................................7
2.03 Form of Debentures...................................................7
2.04 Signature on Debentures..............................................8
2.05 Certification........................................................8
2.06 Registration and Transfer of Debentures..............................8
2.07 Transfer from Register to Register...................................9
2.08 Power to Close Registers.............................................9
2.09 Notices to Debentureholders..........................................9
2.10 Inspection of Registers..............................................9
2.11 Persons Regarded as Owners..........................................10
2.12 Mutilation, Loss, Theft or Destruction of Debentures................10
2.13 Exchanges of Debentures.............................................10
2.14 Production of List of Holders.......................................11
2.15 Option of Holder as to Place of Payment.............................11
2.16 Denominations of Debentures.........................................12
2.17 Computation of Interest.............................................12
2.18 Escrowed Funds......................................................12
ARTICLE 3 REDEMPTION AND PURCHASE OF DEBENTURES.............................12
3.01 Redemption..........................................................12
3.02 Limitation on Redemption............................................13
3.03 Partial Redemption of Debentures....................................13
3.04 Notice of Redemption................................................13
3.05 Debentures Due on Redemption Dates..................................14
3.06 Deposit of Redemption Moneys........................................14
3.07 Failure to Surrender Debentures Called for Redemption...............14
3.08 Cancellation and Destruction of Debentures..........................15
3.09 Surrender of Debentures for Cancellation............................15
3.10 Purchase of Debentures..............................................15
3.11 Rights to Convert Preserved.........................................15
ARTICLE 4 CONVERSION OF THE DEBENTURES......................................15
4.01 Conversion Right....................................................15
4.02 Conversion in Multiples.............................................16
4.03 Conversion Procedure................................................16
4.04 Cancellation of Debentures..........................................17
4.05 Adjustment of Price and Terms.......................................17
4.06 Postponement of Subscription........................................22
4.07 Treatment of Fractions..............................................22
4.08 Notice of Adjustment................................................22
4.09 Notice of Maturity..................................................23
ARTICLE 5 GUARANTEE AND SECURITY............................................23
5.01 Guarantee of Debentures.............................................23
5.02 Gross-up for Withholding Taxes on Payments by the Guarantor
under Debentures..................................................24
5.03 Further Assurances..................................................25
5.04 Registration........................................................25
5.05 Authority to Charge and Maintenance of Security.....................26
5.06 Release and Discharge...............................................26
ARTICLE 6 SUBORDINATION...................................................27
6.01 Subordination of Debentures.........................................27
6.02 Payment of Proceeds in Certain Events...............................27
6.03 Subrogation to Senior Indebtedness..................................28
6.04 Senior Indebtedness Default.........................................28
6.05 Notice to Trustee of Senior Indebtedness Default....................28
6.06 Certain Exceptions..................................................29
6.07 Failure to Act Not a Waiver.........................................29
6.08 Renewal or Extension of Senior Indebtedness.........................29
6.09 Trustee to be Agent of Holders......................................30
6.10 Company to Issue Certificates of Senior Indebtedness................30
ARTICLE 7 CERTAIN COVENANTS OF THE COMPANY..................................30
7.01 General Covenants of the Company....................................30
7.02 General Covenants of the Guarantor..................................32
7.03 Representations and Warranties of the Company and the Guarantor.....34
7.04 Trustee may Perform Covenants.......................................34
7.05 No Other Convertible Obligation to Rank Ahead of Debentures.........34
7.06 Company Not to Extend Time for Payment of Interest..................34
7.07 Annual Compliance Certificate.......................................34
ARTICLE 8 EVENTS OF DEFAULT.................................................35
8.01 Events of Default...................................................35
8.02 Notice of Event of Default..........................................36
8.03 Waiver of Default...................................................36
8.04 Right of Trustee of Enforce Payment.................................37
8.05 Application of Moneys by Trustee....................................37
8.06 Trustee Not Bound to Make Interim Payment...........................37
8.07 Notice of Payment by Trustee........................................38
8.08 Trustee May Demand Production of Debentures.........................38
8.09 Trustee Appointed Attorney..........................................38
8.10 Remedies Cumulative.................................................38
8.11 Covenants for Benefit of Parties and Debentureholders...............38
8.12 Judgment Against Company on an Express Trust........................38
ARTICLE 9 CONSOLIDATION AND AMALGAMATION....................................39
9.01 Successor Company or Guarantor......................................39
9.02 Successor Company/Successor Guarantor to Possess Powers of
the Company/Guarantor.............................................39
ARTICLE 10 INVESTMENT OF TRUST MONIES.......................................40
10.01 Investment of Trust Monies..........................................40
ARTICLE 11 SUITS BY DEBENTUREHOLDERS AND TRUSTEE............................40
11.01 Debentureholder May Not Xxx.........................................40
11.02 Trustee May Xxx Without Possession of Debentures....................41
11.03 Delay Not Waiver....................................................41
11.04 Staying Actions.....................................................41
ARTICLE 12 IMMUNITY OF OFFICERS, SHAREHOLDERS AND DIRECTORS.................41
12.01 Immunity of Officers, Shareholders and Directors....................41
ARTICLE 13 CONCERNING THE TRUSTEE...........................................42
13.01 Concerning the Trustee..............................................42
13.02 Rights and Duties of Trustee........................................42
13.03 Evidence, Experts and Advisers......................................43
13.04 Action by Trustee to Protect Interests..............................43
13.05 Trustee Not Required to Give Security...............................43
13.06 Protection of Trustee...............................................44
13.07 Indemnification of Trustee..........................................44
13.08 Replacement of Trustee..............................................44
13.09 Conflict of Interest................................................45
13.10 Acceptance of Trust.................................................45
ARTICLE 14 NON-PRODUCTION OF DEBENTURES.....................................45
14.01 Non-Production of Debentures........................................45
ARTICLE 15 EVIDENCE OF RIGHTS OF DEBENTUREHOLDERS...........................46
15.01 Evidence of Rights of Debentureholders..............................46
ARTICLE 16 DEBENTUREHOLDERS' MEETINGS.......................................46
16.01 Debentureholders' Meetings..........................................46
16.02 Powers Exercisable by Extraordinary Resolution......................49
16.03 Extraordinary Resolutions...........................................50
16.04 Declaration by Chairman of Result of Vote...........................51
16.05 Minutes.............................................................51
16.06 Signed Instrument in Lieu of Extraordinary Resolution...............51
16.07 Binding Effect of Resolutions.......................................52
ARTICLE 17 SUPPLEMENTAL INDENTURES..........................................52
17.01 Supplemental Indentures.............................................52
ARTICLE 18 TERMINATION......................................................53
18.01 Termination.........................................................53
ARTICLE 19 COUNTERPARTS.....................................................53
19.01 Counterparts........................................................53
ARTICLE 20 NOTICES..........................................................54
20.01 Notices to Company and Guarantor....................................54
20.02 Notices to Trustee..................................................54
20.03 Notice of Debentureholders..........................................54
ARTICLE 21 FORMAL DATE......................................................55
20.01 Formal Date.........................................................55
THIS TRUST INDENTURE is made as of the 28th day of May, 1999.
BETWEEN:
RADIANT ENERGY CORPORATION, a corporation amalgamated
under the laws of Canada (hereinafter called the
"Company")
OF THE FIRST PART
- and -
RADIANT AVIATION SERVICES, INC., a corporation
incorporated under the laws of the State of New York
(hereinafter called the "Guarantor")
OF THE SECOND PART
- and -
THE TRUST COMPANY OF BANK OF MONTREAL, a trust company existing
under the laws of Canada (hereinafter called the "Trustee")
OF THE THIRD PART
WHEREAS the Company proposes to issue and sell $100 principal amount
of redeemable convertible secured subordinated debentures (the "Debentures")
upon the terms and conditions set forth in a rights offering circular filed with
the Ontario Securities Commission;
AND WHEREAS the Company proposes to issue, in the aggregate, up to
$2,350,000 principal amount of Debentures;
AND WHEREAS, under the laws relating thereto, the Company is duly
authorized to create and issue, from time to time, the Debentures to be issued
as herein provided;
AND WHEREAS the Guarantor is a wholly-owned subsidiary of the
Company;
AND WHEREAS the Debentures are secured by, among other things, a
guarantee of the Company's obligations in respect of the Debentures by the
Guarantor supported by a charge on substantially all of the assets owned by the
Guarantor;
AND WHEREAS all necessary proceedings have been duly taken to make
the creation and issue of the Debentures intended to be certified and issued
hereunder, and these presents and the execution thereof, legal and valid and in
accordance with the laws relating to the Company and with all other laws and
regulations in that behalf;
AND WHEREAS the Trustee has agreed to act as trustee for and on
behalf of the Debentureholders on the terms and conditions herein set forth;
AND WHEREAS the foregoing recitals are made as representations and
statements of fact by the Company and not by the Trustee;
NOW THEREFORE THIS TRUST INDENTURE WITNESSETH that for good and
valuable consideration mutually given and received, the receipt and sufficiency
of which are hereby acknowledged, it is hereby covenanted, agreed and declared
as follows:
ARTICLE 1
INTERPRETATION
1.01 Definitions
In this Trust Indenture, the recitals hereto and the Debentures, unless
there is something in the subject matter or context inconsistent therewith, the
following terms or expressions shall have the following meanings, respectively:
"this Trust Deed", "this Indenture", "this Trust Indenture", "this deed",
"these presents", "hereto", "herein", "hereof", and similar expressions
refer to this Trust Indenture and not to any particular Article, Section
or other portion hereof and include any and every deed or instrument
supplemental or ancillary hereto or in implement hereof;
"Affiliate" has the meaning ascribed thereto in the Canada Business
Corporations Act;
"Authorized Investments" means short term interest bearing or discount
debt obligations issued or guaranteed by the Government of Canada or a
Province or a Canadian chartered bank (which may include an affiliate or
related party of the Trustee) provided that each such obligation is rated
at least R1 (middle) by DBRS Inc. or an equivalent rating by Canadian Bond
Rating Service;
"business day" means a day which is not a Saturday, Sunday, or civic or
statutory holiday in the City of Toronto;
"CDN" means the Canadian Dealing Network Inc.;
"Company" means Radiant Energy Corporation and any successor company which
shall have complied with the provisions of Article 9 hereof;
"Company's Auditors" or "Auditors of the Company" means the chartered
accountant or firm of accountants duly appointed as auditor or auditors of
the Company from time to time in accordance with the provisions of the
Canada Business Corporations Act;
"Conversion Price" shall have the meaning ascribed thereto in Section 4.01
of this Indenture;
"Counsel" means a barrister and solicitor or a firm of barristers and
solicitors (who may be counsel to the Company) retained by the Company or
retained by the Trustee and acceptable to the Trustee, acting reasonably;
"Current Market Price" means, for any date, the weighted average price at
which the Shares have traded in the over-the-counter market or on a
recognized exchange or market during the 20 consecutive trading days (on
each of which at least 500 Shares are traded in board lots) ending the
fifth trading day before such date as reported by CDN or such other
quotation system as may then be in use, or such other market or exchange
in which the Shares are then trading, and the weighted average price shall
be determined by dividing the aggregate sale price of all Shares sold
in board lots on the over-the-counter market, or recognized exchange or
market, as the case may be, during the 20 consecutive trading days by the
number of Shares sold. If the Shares are not then traded in the
over-the-counter market or on a recognized exchange or market, the Market
Price of the Shares shall be the fair market value of the Shares as
determined in good faith by the board of directors of the Company after
consultation with a nationally or internationally recognized investment
dealer or investment banker;
"Debentures" means the 7% redeemable convertible secured subordinated
debentures issued, from time to time, and certified hereunder and for the
time being outstanding and includes Debentures issued on the exchange of
any Debenture under Section 2.13, as a result of a partial redemption of
Debentures under Section 3.03;
"Debentureholders" and "holders" means the several persons for the time
being entered in the registers hereinafter mentioned as the holders of
outstanding Debentures;
"Designated Representative" means the trustee or trustees under any
indenture in virtue of which Senior Indebtedness is issued or, failing any
such trustee or trustees, the person or persons designated in writing to
the Trustee by the holders of a majority in outstanding principal amount
of Senior Indebtedness of each class or series or, in the absence of such
designation, the person or persons designed in writing to the Trustee by
the Company;
"Directors" or "directors" means the board of directors of the Company or
the Guarantor, as the case may be, for the time being, and reference to
action by the directors shall mean action by the directors as a board or
by any committee thereof duly empowered to take such action;
"dividends paid in the ordinary course" means dividends paid on the Shares
in any fiscal year of the Company, whether in (i) cash, (ii) shares, (iii)
rights, options or warrants (other than rights, options or warrants
referred to in subsection 4.05(3) or to purchase Shares at a price per
Share less than 95% of the current market price of the Shares on the
record date for such dividend) to purchase any securities, property or
other assets of the Company, or (iv) property or other assets of the
Company; provided that the amount or value of such dividends in the
aggregate (any such securities, property or other assets so distributed to
be valued at the fair market value of such securities, property or other
assets, as the case may be, as determined by the directors, with the
concurrence of the Trustee) does not in any such fiscal year exceed 50% of
the consolidated net income of the Company (before extraordinary items)
for its immediately preceding fiscal year, as determined in accordance
with Canadian generally accepted accounting principles;
"Environmental Laws" means all federal, provincial, state, municipal,
county, local and other laws, statutes, codes, ordinances, by-laws, rules,
regulations, policies, guidelines, certificates, approvals, permits,
consents, directions, standards, judgments, orders and other
authorizations, as well as common law, civil and other jurisprudence or
authority, in each case domestic or foreign, having the force of law at
any time relating in whole or in part to any Environmental Matters and any
permit, order, directions, certificate, approval, consent, registration,
licence or other authorization of any kind held or required to be held in
connection with any Environmental Matters;
"Environmental Matters" means:
(a) condition or substance, heat, energy, sound, vibration,
radiation or odour that may affect any component of the earth
and its surrounding atmosphere or affect human health or any
plant, animal or other living organism; and
(b) any waste, toxic substance, contaminant or dangerous good or
the deposit, release or discharge of any thereof into any
component of the earth and its surrounding atmosphere;
"Escrowed Funds" has the meaning ascribed thereto in Section 2.18;
"Extraordinary Resolution" has the meaning ascribed thereto in Section
16.03;
"Guarantee" has the meaning ascribed thereto in Article 5;
"Guarantor" means Radiant Aviation Services, Inc., a company incorporated
under the laws of the State of New York and a wholly-owned subsidiary of
the Company;
"Joint Holders" and "Joint Registered Holders" means, the case of two or
more persons being the holders of a Debenture, all of such persons
registered as holding in any estate or in any common capacity be it joint
tenancy, tenancy in common or otherwise;
"Officers' Certificate" and "Certificate of the Company" means a
certificate signed by any two of the Chairman, Chief Operating Officer,
Vice-President or Secretary-Treasurer or by any one of the said officers
and a director of the Company or by any two directors of the Company;
"Patent" means United States Letters Patent No. 5,417,389 issued May 23,
1995 entitled, "Methods and Apparatus For DeIcing an Aircraft by Infrared
Radiation";
"person" includes any individual, corporation, body corporate,
partnership, trust, trustee, unincorporated organization or other judicial
entity, any government agency or instrumentality and words importing
persons have a similar meaning;
"prime rate" for any day means the reference rate of interest reported,
quoted or announced and commonly known as the prime rate of interest by
and of Bank of Montreal for Canadian dollar commercial loans made in
Canada, in all cases adjusted automatically and without the necessity of
any notice to the Company upon each reported, quoted or announced change
to such rate;
"Security" means any mortgage, charge, hypothec, pledge, assignment, lien,
security interest or other encumbrance, including any sale and repurchase
or sale and lease back arrangement or any other arrangement of similar
effect;
"Senior Indebtedness" means the principal of, premium, if any, and
interest on,
(a) indebtedness evidenced by the outstanding 6% redeemable convertible
secured debentures issued by the Company pursuant to the trust
indenture made May 22, 1997 between the Company, the Guarantor and
The R-M Trust Company (now CIBC Mellon Trust Company);
(b) indebtedness (other than indebtedness evidenced by the Debentures)
for money borrowed or to be borrowed by the Company, a Subsidiary,
or both, for the purpose of constructing de-icing service centres,
and
(c) the indebtedness existing as at the date of this Indenture for money
borrowed by the Company from directors, officers and shareholders of
the Company, including but not limited to indebtedness owed to
directors, officers and shareholders of the Company and for which
the Company, the Guarantor, or both, has granted Security, and
renewals, extensions and refundings of any such indebtedness as
follows:
(i) approximately $110,700 owed to Xxxxxxx X. Xxxx, a director,
officer and shareholder of the Company, and
(ii) approximately $208,794 owed to Xxxxx X. Xxxxxxxx, a director
of the Company, and his Affiliates;;
"Senior Indebtedness Default" means the occurrence or existence of any
event or circumstance which would permit the holder or holders of any
class or series of Senior Indebtedness or its or their Designated
Representative(s) to declare such Senior Indebtedness due and payable
prior to the stated maturity thereof;
"Shares" means common shares in the issued and outstanding capital of the
Company or any securities into which such common shares may be exchanged,
reclassified, reorganized or otherwise converted;
"Subsidiary" has the meaning ascribed thereto in the Canada Business
Corporations Act; and
"Trustee" means The Trust Company of Bank of Montreal or its successor in
the trusts hereby created.
1.02 Number and Gender
Words importing the singular number only shall include the plural and vice
versa and words importing gender shall include the masculine and feminine
genders and words importing persons shall include firms, associations and
corporations and vice versa.
1.03 Choice of Language
The parties hereto have required that this Indenture and all documents and
notices related thereto and resulting therefrom be drawn up in English. Les
parties aux presentes ont exige que la presente convention ainsi que tous les
documents et avie qui s'y rattachent et qui en decouleront soient rediges en
langue anglaise.
1.04 Business Day
Whenever any payment is due or required to be made or any other action is
required to be taken under this Indenture or the Debentures on or as of a day
that is not a business day, that payment must be made and the other action must
be taken on or as of the next day that is a business day.
1.05 Headings
The division of this Indenture into Articles, Sections, Subsections and
clauses, the provision of a table of contents and the insertion of headings are
for convenience of reference only and shall not affect the construction or
interpretation of this Indenture or the Debentures.
1.06 Meaning of "Outstanding"
Every Debenture certified and delivered by the Trustee hereunder shall be
deemed to be outstanding until it is cancelled or delivered to the Trustee for
cancellation or monies for the payment or redemption thereof have been set aside
under Article 3, provided that:
(a) Debentures which have been partially redeemed, purchased or
converted will be deemed to be outstanding only to the extent of the
unredeemed, unpurchased, or unconverted part of the principal amount
thereof;
(b) where a new Debenture has been issued in substitution for a
Debenture that has been lost, stolen or destroyed, only one of them
will be counted for the purpose of determining the aggregate
principal amount of Debentures outstanding; and
(c) for the purpose of any provision of this Indenture entitling holders
of outstanding Debentures to vote, sign consents, requests or other
instruments or take any other action under this Indenture,
Debentures owned legally or equitably by the Company or any
Subsidiary thereof shall be disregarded, except that:
(i) for the purpose of determining whether the Trustee shall be
protected in relying on any such vote, consent, request or
other instrument or other action, only the Debentures of which
the Trustee has notice that they are so owned shall be so
disregarded; and
(ii) Debentures so owned which have been pledged in good faith
other than to the Company or any Subsidiary of the Company
shall not be so disregarded if the pledgee shall establish to
the satisfaction of the Trustee the pledgee's right to vote
the Debentures in his or her discretion free from the control
of the Company or any Subsidiary of the Company, as the case
may be, and the terms of the pledge thereof as to the right to
vote shall govern.
1.07 Time of the Essence
Time shall be of the essence in all respects hereof and of the Debentures.
1.08 Applicable Law
This Indenture and the Debentures shall be governed by and construed in
accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein and shall be treated in all respects as Ontario contracts.
1.09 Currency
Unless otherwise stated, all dollar amounts referred to in this Indenture
are denominated in Canadian dollars.
ARTICLE 2
THE DEBENTURES
2.01 Limit of Issue
The aggregate principal amount of Debentures which may be issued hereunder
is limited to Two Million Three Hundred Fifty Thousand Dollars ($2,350,000) in
lawful money of Canada.
2.02 Designation, Interest and Maturity
The Debentures shall be designated as "7% Redeemable Convertible Secured
Subordinated Debentures", shall be dated May 28, 1999 (regardless of their
actual date of issue), shall mature on May 31, 2004, shall be redeemable as set
forth in Article 3, shall be convertible into Shares as set forth in Article 4,
shall be secured as set forth in Article 5, shall be subordinated as set forth
in Article 6, and shall
bear interest from their date of issue to and including May 31, 2004 (or their
earlier payment and discharge), at the rate of seven per cent (7%) per annum as
well after as before maturity, default or judgment (with interest on overdue
interest at the said rate) payable semi-annually on November 30 and May 31 of
each year, commencing November 30, 1999. All Debentures shall rank equally and
rateably without discrimination, preference or priority amongst themselves but
shall rank in priority to other present or future indebtedness of the Company,
except as otherwise specified in Article 6. The provisions of this Indenture
shall be binding on the Company, the holders of the Debentures and all persons
claiming through or under them respectively. Holders of Debentures shall be
deemed to have notice of these provisions.
2.03 Form of Debentures
The Debentures shall be issued in registered form in minimum denominations
of one hundred dollars ($100) in or substantially in the form set forth in
Schedule "A" to this Indenture (which is incorporated herein by reference) and
shall bear such distinguishing letters and numbers as the Trustee may approve.
The Debentures may be typewritten, photocopied, engraved, lithographed, printed
or partly in one form and partly in another, as the Company may determine.
2.04 Signature on Debentures
All Debentures issued hereunder shall be signed by any two of the
Chairman, the Chief Operating Officer and a Vice-President of the Company. The
signature or signatures of all or any one or more of such officers may be
engraved, lithographed, printed or otherwise mechanically reproduced on the
Debentures and such engraved, lithographed, printed or otherwise mechanically
reproduced signature or signatures shall be deemed for all purposes to be the
signature of such officer or officers and shall be binding upon the Company,
notwithstanding any change in any of the persons holding the said offices
between the time of actual signing and the certifying and delivery of the said
Debentures and notwithstanding that the Chairman, the Chief Operating Officer or
the Vice-President signing may not have held office at the date of this
Indenture or at the date of the certifying and delivery thereof.
2.05 Certification
(1) No Debenture shall be issued, or, if issued, shall be obligatory or
shall entitle the holder to the benefit of these presents or of the trusts
hereunder until it has been certified by or on behalf of the Trustee, and such
certification by the Trustee upon any such Debenture shall be conclusive
evidence that the Debenture so certified has been duly issued hereunder and that
the holder thereof is entitled to the benefit of these presents and of the
trusts under this Indenture. The certificate of the Trustee on any Debenture
shall be substantially in the form set out in Schedule "A" hereto or in some
other form approved by the Trustee. The certificate of the Trustee signed on the
Debentures shall not be construed as a representation or warranty by the Trustee
as to the validity of this Indenture or of the said Debentures and the Trustee
shall in no respect be liable or answerable for the use made of the said
Debentures or any of them or the proceeds thereof. The certificate of the
Trustee signed on the Debentures shall, however, be a representation and
warranty by the Trustee that the said Debentures have been duly certified by the
Trustee pursuant to the provisions of this Indenture.
(2) Debentures, to the aggregate limit hereinbefore authorized, may,
forthwith upon the execution hereof or from time to time hereafter, be issued by
the Company and be certified by or on behalf of the Trustee, and be delivered by
the Trustee in accordance with and upon the written order of the Company
(evidenced by a written request signed by any two of the Chairman, the Chief
Operating Officer and a Vice-President of the Company) upon receipt by the
Trustee of an opinion of counsel to the effect that this Indenture has been duly
executed; provided, however, that no Debenture shall be certified
or delivered if the Company is at the time, to the knowledge of the Trustee, in
default under any of the provisions of this Indenture or if at the time, to the
knowledge of the Trustee, any event has occurred which with the passing of time,
the giving of notice, or both, as the case may be, would become an event of
default under this Indenture. Any certification and delivery of any Debentures
by the Trustee shall be conclusive evidence of the absence of knowledge on the
part of the Trustee of any such default or event at the time of such
certification and delivery.
2.06 Registration and Transfer of Debentures
The Debentures to be issued hereunder shall be in registered form only.
The Company shall at all times cause to be kept, by and at the principal
transfer office of the Trustee in the City of Toronto and at such other place or
places, and by the Trustee or such other registrar or registrars, if any, as the
Company, with the approval of the Trustee, may designate, registers in any one
of which shall be entered the names and post office addresses of the holders of
Debentures and particulars of the Debentures held by them respectively and in
which transfers of such Debentures shall be registered. No transfer of a
Debenture shall be valid unless made on one of such registers by the registered
holder or by his or her executors, administrators or other legal representatives
or his, her or their attorney duly appointed by an instrument in writing in form
and execution satisfactory to the Trustee, and upon compliance with such
reasonable requirements as the Trustee or other registrar may prescribe and
unless such transfer shall have been duly noted on the said Debenture by the
Trustee or other registrar. The Company shall not permit the transfer of a
Debenture to be made except in compliance with all applicable laws, including
without limitation, all securities laws, regulations, policy statements, orders,
rulings and other requirements of relevant securities regulatory authorities.
2.07 Transfer from Register to Register
The holders of Debentures may at any time and from time to time, upon
payment of a reasonable fee to be fixed by the Trustee, transfer the Debentures
held by them respectively from the register in which the registration of such
Debentures appears to another register maintained in another place authorized
for that purpose under the provisions of this Indenture. Such registration shall
be noted on the Debentures by the Trustee or other registrar.
2.08 Power to Close Registers
The Company, with the approval of the Trustee, shall have power at any
time to close any register upon which the entries of the registration of any
Debentures appear (other than those kept in the City of Toronto) and in that
event shall transfer the records thereof to another existing register or to a
new register and thereafter such Debentures shall be deemed to be registered on
such existing or new register, as the case may be. In the event that the
register in any place is closed and the records transferred to a register kept
in another place, notice of such change shall be given, in the manner provided
in Section 2.09 hereof, to the holders of the Debentures registered in the
register so closed.
2.09 Notices to Debentureholders
(1) Subject to the provisions hereinafter contained regarding notices of
intention to redeem, as set out in Section 3.04 hereof, all notices given
hereunder to the Debentureholders shall be deemed validly given if sent by first
class prepaid mail addressed to such holders at their postal addresses appearing
in the registers hereinbefore mentioned or, delivered by hand to such addresses,
and in the case of Joint Holders, to the registered address of one of such Joint
Holders. If the Trustee determines that mail service is or is threatened to be
interrupted at the time when the Company or Trustee is required or elects to
give any notice to holders of Debentures, such notice may be given by means of
publication in The Globe and Mail, national edition, or any other English
language daily newspaper of general circulation in Canada approved by the
Trustee. Any notice so given shall be deemed to have been given on the date it
is first published.
(2) All such notices sent by post may be mailed at any place in Canada
where the Company may have established registers in accordance with the
foregoing provisions of this Indenture or partly at one of such places and
partly at another or others. Every notice so sent by post or by hand shall be
deemed to have been given on the fifth business day after it has been mailed or
on the day upon which it has been delivered, as the case may be. Every notice so
published shall be deemed to have been given on the day when such notice is
posted or on the day upon which it is first published, as aforesaid, as the case
may be.
2.10 Inspection of Registers
The registers hereinbefore referred to shall at all reasonable times be
open for inspection by the Company, the Trustee or any Debentureholder.
2.11 Persons Regarded as Owners
(1) The person in whose name any Debenture shall be registered shall be
deemed and regarded as the owner thereof for all purposes of this Indenture and
payment of or on account of the principal of such Debenture and interest on such
Debenture shall be made only to, or upon the order in writing of, such
registered holder thereof.
(2) The registered holder for the time being of any Debenture shall be
entitled to the principal monies and interest evidenced by such instruments,
free from all equities or rights of set-off or counterclaim between the Company
and the original or any intermediate holder thereof and all persons may act
accordingly, and a transferee of a Debenture shall, after the appropriate form
of transfer is lodged with the registrar and upon compliance with all other
conditions in that behalf required by or pursuant to this Indenture or by the
conditions endorsed on the Debentures or by law, be entitled to be entered on
the register as the owner of such Debenture free from all equities or rights of
set-off or counterclaim between the Company and his or her transferor or any
previous holder thereof, save in respect of equities as to which the Company is
required to take notice by law.
(3) Delivery by a Debentureholder of a Debenture to the Company or the
receipt by such holder of the principal monies, interest, or both, evidenced by
such instrument respectively shall be a good discharge to the Company, which
shall not be bound to enquire into the title of such holder, save as required by
law. Neither the Company nor the Trustee nor any registrar shall be charged with
any notice or be bound to see to the execution of any trust, whether express,
implied or constructive, affecting the ownership of any Debenture or be affected
by notice of any equity that may be subsisting in respect thereof, and the
Trustee, such registrar, or both, may transfer any Debenture on the direction of
the registered holder thereof, whether named as trustee or otherwise, as though
that person were the beneficial owner thereof.
2.12 Mutilation, Loss, Theft or Destruction of Debentures
(1) In case any of the Debentures shall become mutilated or be lost,
stolen or destroyed, the Company in its discretion may issue and thereupon the
Trustee, subject to the conditions contained in this Section 2.12, shall certify
and deliver, a new Debenture of like date and tenor as the one mutilated, lost,
stolen or destroyed, in exchange for and in place of and upon cancellation of
the mutilated Debenture or in lieu of and in substitution for the same, if lost,
stolen or destroyed and the substituted instrument shall be in a form approved
by the Trustee and shall rank equally in accordance with its terms with all
other Debentures.
(2) In case of loss, theft or destruction, the applicant for a substituted
Debenture shall, as a condition precedent to the issue thereof, furnish to the
Company and to the Trustee such evidence of ownership and of the loss, theft or
destruction of such instrument so lost, stolen or destroyed as shall be
satisfactory to the Company and to the Trustee in their discretion, acting
reasonably and such applicant shall also furnish an indemnity in an amount and
form satisfactory to the Company and the Trustee in their discretion, acting
reasonably and shall pay the expenses which may be incurred by them and their
reasonable charges in the premises.
2.13 Exchanges of Debentures
(1) Except as herein otherwise provided, in every case of exchange of
Debentures of any denomination or form for other Debentures, and for any
registration of Debentures, and for any transfer of Debentures, the Trustee or
other registrar may make a sufficient charge to reimburse it for any stamp taxes
or governmental charge required to be paid and a reasonable charge for its
services and, in addition, may charge a reasonable charge per Debenture issued
upon such exchange, registration or transfer as a condition precedent thereof.
(2) Debentures of any denomination may be exchanged for Debentures of any
other authorized denomination or denominations, any such exchange to be for an
equivalent principal amount of Debentures. All exchanges of Debentures shall be
made at the principal transfer office of the Trustee in the City of Toronto or
at the office or offices of such other registrar or registrars, if any, or at
such other office or offices of the Trustee, if any, as may from time to time be
designated by the Company, with the approval of the Trustee, for such purpose.
In every case of exchange and transfer, the Debenture or Debentures surrendered
shall be cancelled.
(3) Neither the Company nor the Trustee nor any registrar shall be
required (i) to make redemptions, transfers, exchanges, conversions or
registrations of Debentures for a period of fifteen (15) business days next
preceding any interest payment date; or (ii) to make exchanges of any Debentures
during the fifteen (15) business days next preceding any selection by the
Trustee of Debentures to be redeemed. Debentures issued in exchange for
Debentures which at the time of such issue have been selected or called for
redemption shall be deemed to have been called or selected for redemption in the
same manner and shall have noted thereon a statement to that effect.
2.14 Production of List of Holders
Every registrar (including the Trustee) shall when requested in writing to
do so by the Company, the Trustee or a Debentureholder furnish the Company, the
Trustee, or upon payment by the Debentureholder of a reasonable fee and upon
providing the Trustee with the required documents, the Debentureholder, as the
case may be, with a list of the names and addresses of holders of Debentures
showing the principal amount and serial numbers of such Debentures held by such
holders.
2.15 Option of Holder as to Place of Payment
(1) Except as otherwise herein provided, all sums which may at any time
become payable whether at maturity or on redemption or otherwise on account of
any Debenture or interest thereon shall be payable at the option of the holder
at any of the places at which the principal of, and interest on, such Debenture
are respectively payable in accordance with the provisions of such Debenture.
(2) As the interest on Debentures matures (except interest payable at
maturity which shall be paid upon presentation and surrender of Debentures for
payment), at least three (3) business days prior to each date on which interest
on the Debentures becomes due, the Company shall forward to or deposit with the
Trustee a written notice in accordance with Section 2.18 or a cheque or bank
draft in an amount equal to the aggregate amount of interest payable on all then
outstanding Debentures, and the Trustee shall forward or cause to be forwarded
by first class prepaid post (or if mail service is interrupted, by any other
means the Company and the Trustee deem appropriate) to each holder of then
outstanding Debentures for the time being or, in the case of Joint Holders, to
one of such Joint Holders, at his or her
address appearing on the appropriate register hereinbefore mentioned, a cheque
for such interest (less any tax required to be deducted) payable to the order of
such holder or holders and negotiable at par at each of the places at which
interest upon such Debentures is payable. The forwarding of such cheque shall
satisfy and discharge the liability of the Company for the interest upon such
Debentures to the extent of the sum represented thereby (plus the amount of any
tax deducted as aforesaid) provided that in the event of the non-receipt of such
cheque by the registered holder, or the loss or destruction thereof, the Trustee
upon being furnished with reasonable evidence of such non-receipt, loss or
destruction and indemnity reasonably satisfactory to it shall issue to such
registered holder a replacement cheque for the amount of such cheque.
(3) The principal of the Debentures and interest thereon and all sums
which may at any time become payable thereon, whether at maturity or otherwise,
shall be payable in lawful money of Canada.
2.16 Denominations of Debentures
The Debentures shall be in denominations of $100 only and whole multiples
thereof. The Debentures shall be numbered in such manner as the Company, with
the approval of the Trustee, may determine.
2.17 Computation of Interest
All Debentures issued hereunder, whether originally or upon exchange or in
substitution for previously issued Debentures, shall bear interest from their
date of issue or from the last interest payment date to which interest shall
have been paid or made available for payment on such Debentures, whichever shall
be the later. Interest shall be computed on the basis of a year of 365 or 366
days, as applicable.
2.18 Escrowed Funds
Seven percent (7%) of the aggregate principal amount of the Debentures
issued (the "Escrowed Funds") will be held in escrow by the Trustee and will be
invested by the Trustee in accordance with the provisions of Section 10.01
hereof. Not less than three (3) business days prior to each of the first or
second dates on which interest on the outstanding Debentures becomes due and
payable under the terms of the Debentures (each an "Escrowed Interest Payment
Date"), the Company may, in lieu of the cheque or bank draft required to the
delivered by the Company to the Trustee under Section 2.15(2) hereof, deliver to
the Trustee written notice (an "Escrow Release Notice") instructing the Trustee
to release from escrow that portion of the Escrowed Funds equal to the amount
necessary to make interest payments on that Escrowed Interest Payment Date and
to cause such released Escrowed Funds to be used to make interest payments
required to be made on that Escrowed Interest Payment Date under the terms of
the Debentures. Upon receipt of an Escrow Release Notice from the Company, the
Trustee shall release from escrow that portion of the Escrowed Funds equal to
the amount necessary to make interest payments on that Escrowed Interst Payment
Date and cause such released Escrowed Funds to be used to make interest payments
required to be made on that Escrowed Interest Payment Date under the terms of
the Debentures. If, after the full payment of interest on any Debentures
outstanding as at the second Escrowed Interest Payment Date, the Trustee holds
all or any portion of the Escrowed Funds, the Trustee shall promptly release
from escrow and deliver to the Company the Escrowed Funds (and any interest
accrued thereon).
ARTICLE 3
REDEMPTION AND PURCHASE OF DEBENTURES
3.01 Redemption
Subject to Section 3.02 hereof, the Company when not in default hereunder
shall have the right at its option to redeem, on not less than thirty (30) days'
prior notice, either in whole at any time or in part from time to time before
maturity, any of the Debentures of the principal amount thereof together in all
cases with interest on the principal amount of the Debentures so redeemed
accrued and unpaid to the date fixed for redemption (the amount, including
interest, at which any Debentures may be redeemed on any date being herein
sometimes referred to as the "redemption price" of the Debentures).
3.02 Limitation on Redemption
No Debentures may be redeemed by the Company prior to May 31, 2000 and
Debentures may not be redeemed after that date unless the Company shall have
filed with the Trustee on the day notice of the proposed redemption is first
given an Officer's Certificate certifying that the Current Market Price of the
Shares as of the date of such notice equals or exceeds $2.50 per Share (subject
to adjustment in accordance with the terms herein).
3.03 Partial Redemption of Debentures
(1) In case less than all the Debentures for the time being outstanding
are at any time to be redeemed, the Debentures so to be redeemed shall be
redeemed pro rata from the outstanding Debentureholders; provided, however, that
in such case the Debentures shall only be redeemed in denominations of $100
principal amount and whole multiples thereof. The holder of any Debenture called
for redemption in part only, upon surrender of such Debenture in accordance with
Section 3.09 hereof, shall be entitled to receive, without expense to such
holder, one or more new Debentures for the unredeemed part of the principal
amount of the Debenture so surrendered.
(2) Unless the context otherwise requires, the word "Debenture" or
"Debentures" as used in this Article 3 shall be deemed to include that part of
the principal amount of any Debenture which shall have become subject to
redemption pursuant to the provisions hereof.
3.04 Notice of Redemption
Notice of intention to redeem any of the Debentures shall be given by or
on behalf of the Company in the following manner:
(a) notice of intention to redeem such Debentures shall be given by
letter or circular sent in the manner provided in Section 2.09 and
shall be mailed or delivered not less than thirty (30) and not more
than sixty (60) days prior to the date fixed for redemption;
provided always that the non-receipt of any such letter or circular
by any of the holder or holders of any of such Debentures shall not
invalidate or otherwise prejudicially affect the redemption of such
Debentures;
(b) unless all of the Debentures for the time being outstanding are to
be redeemed, every notice of redemption shall state the designating
numbers of the Debentures so called for redemption and in case a
Debenture is to be redeemed in part only, that part of the principal
amount thereof so to be redeemed; and
(c) every notice of redemption shall specify the redemption date and the
redemption price and shall state that unless the redemption price of
such Debentures is not paid on presentation thereof such Debentures
and all interest accruing thereon after such redemption date shall
on and after such redemption date cease.
Every notice sent by delivery or published shall be deemed to have been
given on the day on which it is delivered or first published, as the case may
be. Every notice sent by post shall be deemed to have been given on the fifth
business day after it is posted.
3.05 Debentures Due on Redemption Dates
If notice shall have been given as specified in Section 3.04 and if the
redemption money shall have been duly paid to or to the order of the Trustee as
provided in Section 3.06, but not otherwise, all the Debentures so called for
redemption shall thereupon be and become due and payable at such redemption
price and on such redemption date and in the same manner and with the same
effect as if such redemption date were the date of maturity specified in such
Debentures respectively, anything in such Debentures or herein to the contrary
notwithstanding, and from and after such redemption date interest upon such
Debentures shall cease; but the giving of such notice in conformity with the
provisions hereof shall, if the Company fails to make such payment (whether such
failure results from a change in the Company's intentions, or from circumstances
beyond its control, or otherwise), be of no effect whatsoever, and in the event
of such failure to make payment, such notice shall be deemed to be null, void
and of no effect whatever.
3.06 Deposit of Redemption Moneys
Such redemption shall be provided for by depositing with the Trustee, at
least three (3) business days prior to the redemption date fixed in such notice,
such sums as may be sufficient to pay the redemption price of such Debentures
including accrued interest on the Debentures so called for redemption to the
date of redemption. The Company shall also deposit with the Trustee if required
by it a sum sufficient to pay any charges or expenses which may be incurred by
the Trustee in connection with such redemption. From the sums so deposited the
Trustee shall pay or cause to be paid to the holders of such Debentures so
called for redemption, upon surrender of such Debentures, the principal and
interest to which they are respectively entitled on redemption.
3.07 Failure to Surrender Debentures Called for Redemption
(1) In case the holder of any Debenture so called for redemption shall
fail within sixty (60) days after the date fixed for redemption so to surrender
his Debenture or shall not within such time accept payment of the redemption
monies payable in respect thereof or give such receipt therefor, if any, as the
Trustee may require, such redemption monies shall be set aside in trust for such
holder at such rate of interest, if any, either in the deposit department of the
Trustee or in a chartered bank or trust company in Canada, and such setting
aside shall for all purposes be deemed a payment to the Debentureholder of the
sum so set aside, and to that extent said Debenture shall thereafter not be
considered as outstanding hereunder and the Debentureholder shall have no other
right except to receive payment out of the monies so paid and deposited (upon
surrender and delivery of his or her Debenture) of the redemption price of such
Debenture.
(2) In the event that any monies required to be deposited hereunder with
the Trustee or any depository or paying agent on account of principal of or
interest on Debentures issued hereunder shall remain so deposited for such
period that the right to proceed against the Company for recovery of such monies
by the holders of Debentures has become statute barred, then such monies,
together with any accumulated interest thereon, shall at the end of such period
be paid over by the Trustee or such depository or paying agent to the Company on
its demand. Thereupon the Trustee shall be released from all further liability
with respect to such monies and thereafter the holders of the Debentures in
respect of which such monies were so repaid to the Company shall have no right
in respect thereof except to obtain payment of the monies due thereon from the
Company.
3.08 Cancellation and Destruction of Debentures
All Debentures redeemed under this Article 3 shall forthwith be delivered
to the Trustee and shall be cancelled by it and shall not be reissued. All
Debentures which shall have been delivered to and cancelled by the Trustee shall
be destroyed by the Trustee and if required in advance in writing by the
Company, the Trustee shall furnish to it a destruction certificate setting out
the numbers and denominations of the Debentures so destroyed.
3.09 Surrender of Debentures for Cancellation
If the principal monies due upon any Debenture issued hereunder shall
become payable by redemption or otherwise before the date of maturity thereof,
the person presenting such Debenture for payment shall surrender the same for
cancellation and the Company shall notwithstanding such surrender pay the
interest accrued and unpaid thereon (computed on a per diem basis) up to the
date on which the principal monies are due if the date fixed for payment of the
principal amount is not an interest due date.
3.10 Purchase of Debentures
(1) At any time when the Company is not in default hereunder it may
purchase all or any of the Debentures in the market (which will include purchase
from or through an investment dealer or a firm holding membership on a
recognized stock exchange) or by tender provided that the price at which such
Debentures may be purchased shall not exceed the principal amount of such
Debentures together with accrued and unpaid interest to the date of purchase
plus reasonable costs of purchase. All Debentures so purchased shall forthwith
be delivered to the Trustee and shall be cancelled by it and shall not be
re-issued.
(2) If on an invitation for tenders more Debentures are tendered at the
same lowest price than the Company is prepared to accept, the Debentures to be
purchased at that price shall be purchased proportionately from the Debentures
tendered by each holder who tenders Debentures at that price.
3.11 Rights to Convert Preserved
Any call for redemption of Debentures made by the Company shall be subject
always to the right of the holders of such Debentures to convert the same, as
provided in Article 4 hereof, prior to the date fixed for redemption of such
Debentures pursuant to Section 3.04.
ARTICLE 4
CONVERSION OF THE DEBENTURES
4.01 Conversion Right
(1) For the purposes of this Article 4, "current Conversion Price" means
as at any particular time the basic conversion price unless an adjusted
conversion price is in effect pursuant to the provisions of Section 4.05 hereof
in which case it means such adjusted conversion price, and "basic conversion
price" means $1.15 per Share if converted prior to May 31, 2000 and $1.45 per
Share if converted thereafter, being a rate of approximately 86.96 Shares and
68.97 Shares, respectively, for each $100 principal amount of Debentures.
(2) Subject to and upon compliance with the provisions of this Article 4,
the holder of each Debenture shall have the right, at his option, at any time up
to the close of business on May 31, 2004 to convert such Debenture into fully
paid and non-assessable Shares, without the payment of any further consideration
therefor, by applying the principal amount of such Debenture, as provided for
herein, to the purchase of such Shares at the then current conversion price;
except that in the case of Debentures which shall be called for redemption such
right shall terminate with respect thereto at the close of business on the
business day immediately prior to the date fixed for such redemption. Should
payment of the
redemption price of Debentures which have been called for redemption not be paid
on due surrender of the Debentures as provided for herein, then the right of
conversion shall revive and continue as if such Debentures had not been called
for redemption. Any monies which shall have been deposited with the Trustee for
the redemption of any Debenture which shall have been converted subsequent to
the calling of such Debenture for redemption shall, upon delivery to the Trustee
of reasonable evidence of such conversion, be repaid to the Company.
(3) The Shares issuable upon the conversion of any Debenture converted at
or prior to the time fixed for determining the holders of record of Shares for
the payment of dividends on Shares shall qualify for such dividends. No
adjustment shall be made for dividends on any Shares that shall be issuable upon
the conversion of any Debenture, nor for the interest accrued on the principal
amount of any Debenture so converted.
4.02 Conversion in Multiples
The Debentures shall be wholly convertible into Shares in units of One
Hundred Dollars ($100) principal amount and whole multiplies thereof.
4.03 Conversion Procedure
(1) In order to convert any Debenture, such Debenture shall be delivered
at any time during usual business hours to the Trustee at any office of the
Trustee where Debentures may be registered or transferred on the register
maintained thereat by the Trustee for that purpose, accompanied by a written
notice (substantially in the form set forth in Schedule "A" to this Indenture)
duly executed by the registered holder of such Debenture or his attorney duly
authorized in writing, which notice shall state that the holder elects to
convert the said Debenture in accordance with the provisions hereof and which
notice shall further state the name or names (with addresses) in which the
certificate or certificates for Shares issuable on such conversion shall be
issued and if any of the Shares into which such Debenture is to be converted are
to be issued to a person or persons other than the holder of such Debentures,
there shall be paid to the Trustee any transfer tax which may be properly
payable. If any certificate or certificates representing any of the Shares
issuable on conversion are directed to be issued to any person other than the
holder of such Debenture, the signature of such holder, shall be guaranteed by a
bank, trust company, member of a recognized stock exchange in Canada or by
another person satisfactory to the Trustee. Such holder shall, in addition,
comply with such other reasonable requirements as the Trustee may prescribe.
(2) Subject to Section 4.02 hereof, any holder may by such written notice
elect to convert only part of the principal amount of any Debenture, in which
event the Company shall issue and the Trustee shall certify and deliver to such
holder, at the expense of the Company, a new Debenture registered in the name of
such holder, in a principal amount equal to that part of the principal amount of
the said Debenture which the said holder did not elect to convert.
(3) Every such notice of election to convert shall constitute a contract
between the holder of such Debenture and the Company, whereby the holder of such
Debenture shall be deemed to subscribe for the number of Shares which he will be
entitled to receive upon such conversion and in payment and satisfaction of such
subscription, to surrender such Debenture and to release the Company from all
liability thereon, and whereby the Company shall be deemed to agree that the
surrender of such Debenture and the extinguishment of liability thereon shall
constitute full payment of such subscription for the Shares to be issued upon
such conversion. If more than one (1) Debenture shall be surrendered for
conversion at one time by the same holder, the number of full Shares which shall
be issuable upon the
conversion thereof shall be computed on the basis of the aggregate principal
amount of Debentures so surrendered.
(4) Forthwith after the receipt of such notice of election to convert, the
payment of such transfer tax (if any), the delivery of such Debenture and
compliance with all reasonable requirements of the Trustee as aforesaid, the
Company shall cause the transfer agent for the Shares to issue and deliver, to
or upon the written order of the holder of the Debenture so surrendered (i) a
certificate or certificates for the number of Shares into which such Debenture
has been converted in accordance with the provisions of this Article 4, (ii) a
new Debenture (if required) in a principal amount equal to the principal amount
of the tendered Debenture which the holder did not elect to convert, (iii) an
amount equal to all accrued and unpaid interest on the principal amount of the
Debenture or portion of the Debenture, as the case may be, so converted
calculated to the date on which notice of election is given by the
Debentureholder under this Section 4.03, and (iv) any cash which the Company is
required to pay in accordance with the provisions of Section 4.07 hereof. Such
conversion shall be deemed to have been made immediately prior to the close of
business, at the office of the Trustee where such notice of election was
received, on the date on which all conditions precedent to the conversion of
such Debenture have been fulfilled and the person or persons in whose name or
names any certificate or certificates for Shares shall be issuable shall be
deemed to have become on the said date the holder or holders of record of the
Shares represented thereby; provided, however, that if the transfer books of the
Company for Shares shall be closed on the said date, the Company shall not be
required to issue Shares upon such conversion until the date on which such
transfer books shall be re-opened and such person or persons shall not be deemed
to have become the holder or holders of record of such Shares until the date on
which such transfer books shall be re-opened, but such conversion shall
nevertheless be effected when such transfer books shall be re-opened at the
conversion price in effect on, and otherwise as of, the date of conversion.
(5) The Company covenants that it shall use its best efforts to ensure
that the transfer books for Shares of the Company shall not be closed during any
period which includes a record date for a dividend or other distribution on the
Shares.
4.04 Cancellation of Debentures
All Debentures converted as aforesaid shall be void and shall be
cancelled. All Debentures from time to time converted as aforesaid shall be
cancelled by the Trustee forthwith upon delivery of such Debentures to it and,
subject to Section 4.03, no Debenture shall be issued in substitution therefor.
4.05 Adjustment of Price and Terms
(1) The current conversion price (and the number of Shares issuable upon
conversion of any Debenture) shall be subject to adjustment from time to time as
hereinafter is provided.
(2) If and whenever at any time after the date hereof the Company:
(a) issues Shares or securities exchangeable for or convertible
into Shares, to all or substantially all of the holders of
Shares by way of stock dividend or otherwise (other than an
issue of Shares or securities to holders of Shares who have
elected in the ordinary course to receive dividends in Shares
or securities in lieu of receiving cash dividends);
(b) makes a distribution on its outstanding Shares payable in
Shares or securities exchangeable for or convertible into
Shares (other than a distribution of Shares or securities to
holders of Shares who have elected in the ordinary course to
receive dividends in Shares or securities in lieu of receiving
cash dividends);
(c) subdivides, redivides or changes its outstanding Shares into a
greater number of Shares; or
(d) reduces, combines or consolidates its outstanding Shares into
a smaller number of Shares.
(any of such events in clauses (a), (b), (c) and (d) being called a "Share
Reorganization"), then the current conversion price shall be adjusted effective
immediately after the effective date or record date for the happening of a Share
Reorganization, as the case may be, at which the holders of Shares are
determined for the purpose of the Share Reorganization, by multiplying the
conversion price in effect immediately prior to such effective date or record
date by a fraction, the numerator of which shall be the number of Shares
outstanding on such effective date or record date before giving effect to such
Share Reorganization and the denominator of which shall be the number of Shares
outstanding immediately after giving effect to such Share Reorganization
(including, in the case where securities exchangeable for or convertible into
Shares are issued or distributed, the number of Shares that would have been
outstanding had all such securities been exchanged for or converted into Shares
on such effective date or record date).
(3) If and whenever at any time after the date hereof the Company fixes a
record date for the issue of rights, options or warrants to all or substantially
all the holders of Shares under which such holders are entitled, during a period
expiring not more than 45 days after the date of such issue (the "Rights
Period"), to subscribe for or purchase Shares or securities ("Exchangeable
Securities") exchangeable for or convertible into Shares at a price per share to
the holder (or at an exchange or conversion price per Share during the Rights
Period to the holder in the case of Exchangeable Securities) of less than 95% of
the Current Market Price for the Shares on such record date (any of such events
being called a "Rights Offering"), then the conversion price shall be adjusted
effective immediately after the end of the Rights Period to a price determined
by multiplying the current conversion price by a fraction:
(a) the numerator of which shall be the aggregate of:
(i) the number of Shares outstanding as of the record date
for the Rights Offering; and
(ii) a number determined by dividing (1) either (A) the
product of the number of Shares issued or subscribed for
during the Rights Period upon the exercise of the
rights, warrants or options under the Rights Offering
and the price at which such Shares are offered, or, as
the case may be, (B) the product of the exchange or
conversion price, immediately following the expiry of
the Rights Period, of the Exchangeable Securities which
were issued or subscribed for during the Rights Period
upon the exercise of the rights, warrants or options
under the Rights Offering and the number of Shares for
or into which such Exchangeable Securities could have
been exchange or converted immediately following the
expiry of the Rights Period, by (2) the Current Market
Price of the Shares as of the record date for the Rights
Offering, and
(b) the denominator of which shall be the number of Shares
outstanding, or the number of Shares which would be
outstanding if all the Exchangeable Securities were exchanged
for or converted into Shares immediately following the expiry
of the Rights Period, after giving effect to the Rights
Offering and including the number of Shares actually issued or
subscribed for during the Rights Period upon exercise of the
rights, warrants or options under the Rights Offering.
To the extent that any such rights, options or warrants are not so exercised on
or before the expiry thereof, the conversion price shall be readjusted to the
conversion price which would then be in effect based on
the number of Shares (or Exchangeable Securities) actually delivered on the
exercise of such rights, options or warrants. Any holder of Debentures who has
exercised the right to convert Debentures into Shares during the period
beginning immediately after the record date for a Rights Offering and ending on
the last day of the Rights Period for the Rights Offering shall, in addition to
the Shares to which that holder would otherwise be entitled upon such conversion
in accordance with Section 4.01, be entitled but not obligated, and on payment
of the purchase price for any such rights, options or warrants (the "Rights
Offering Price") to obtain that number of additional Shares that such holder
would have been entitled to receive if such conversion had occurred immediately
prior to such record date; provided that the provisions of Section 4.07 shall be
applicable to any fractional interest in a Share to which such holder might
otherwise be entitled under the foregoing provisions of this subsection. Such
additional Shares shall be deemed to have been issued to the holder immediately
following the end of the Rights Period and a certificate for such additional
Shares shall be delivered to such holder within fifteen (15) business days
following the end of the Rights Period.
(4) If and whenever at any time after the date hereof the Company fixes a
record date for the issue or the distribution to all or substantially all the
holders of Shares of (i) securities of the Company, including rights, options or
warrants to acquire securities of the Company or any of its property or assets
and including evidences of indebtedness or (ii) any property, cash or other
assets, including evidences of indebtedness, and if such issuance or
distribution does not constitute a cash dividend or equivalent dividend in stock
paid in the ordinary course, a Share Reorganization or a Rights Offering (any of
such non-excluded events being called a "Special Distribution"), the conversion
price shall be adjusted effective immediately after such record date to a price
determined by multiplying the conversion price in effect on such record date by
a fraction:
(a) the numerator of which shall be:
(i) the product of the number of Shares outstanding on such
record date and the Current Market Price of the Shares
on such record date; less
(ii) the fair market value, as determined by the directors
(whose determination shall be conclusive), of such
securities or property or other assets so issued or
distributed in the Special Distribution; and
(b) the denominator of which shall be the product of the number of
Shares outstanding on such record date and the Current Market
Price of the Shares on such record date.
To the extent that any Special Distribution is cancelled or revoked, whether by
the Company or otherwise, the conversion price shall be readjusted effective
immediately to the conversion price which would then be in effect based upon
such securities or property or other assets actually distributed.
(5) On any adjustment of the current Conversion Price pursuant to
subsection (2), (3) or (4), including any readjustment, the number of Shares
issuable upon the conversion of $100 principal amount of Debentures shall be
adjusted according to the current Conversion Price.
(6) If and whenever at any time after the date hereof there is a
reclassification of the Shares at any time outstanding or change of the Shares
into other shares or into other securities or other capital reorganization
(other than a Share Reorganization), or a consolidation, amalgamation or merger
of the Company with or into any other corporation or other entity (other than a
consolidation, amalgamation or merger which does not result in any
reclassification of the outstanding Shares or a change of the Shares into other
shares), or a transfer of the undertaking or assets of the Company as an
entirety or substantially as an entirety to another corporation or other entity
(any of such events being called a "Capital Reorganization"), any holder of
Debentures who exercises the right to convert Debentures into Shares after the
effective date of such Capital Reorganization shall be entitled to receive, and
shall accept for the same aggregate consideration, in lieu of the number of
Shares to which such holder was previously entitled upon such conversion, the
aggregate number of shares, other securities or other property which
such holder would have been entitled to receive as a result of such Capital
Reorganization if, on the effective date thereof, such holder had been the
registered holder of the number of Shares to which such holder was previously
entitled upon conversion. The Company shall take all steps necessary to ensure
that, on a Capital Reorganization, the holders of Debentures will receive the
aggregate number of shares, other securities or other property to which they are
entitled as a result of the Capital Reorganization. If necessary, appropriate
adjustments shall be made as a result of any such Capital Reorganization in the
application of the provisions set forth in this Article 4 with respect to the
rights and interests thereafter of holders of Debentures to the end that the
provisions set forth in this Article 4 shall thereafter correspondingly be made
applicable as nearly as may reasonably be in relation to any shares, other
securities or other property thereafter deliverable upon the conversion of any
Debenture. Any such adjustment shall be made by and set forth in an Indenture
supplemental hereto approved by the directors and by the Trustee and entered
into pursuant to the provisions of Article 16 and which shall for all purposes
be conclusively deemed to be an appropriate adjustment.
(7) If the Rights Offering Price referred to in paragraphs (3) or (4) of
this Section 4.05 is decreased, the conversion price shall forthwith be changed
so as to decrease the conversion price to the conversion price that would have
been obtained had the adjustment to the conversion price made under such
paragraph (3) or (4), as the case may be, with respect to such rights, options
or warrants been made on the basis of the Rights Offering Price as so decreased,
provided that the terms of this subsection shall not apply to any decrease in
the Rights Offering Price resulting from terms in any such rights, options or
warrants designed to prevent dilution to the extent that the event giving rise
to such decrease in the Rights Offering Price results in an adjustment of the
conversion price pursuant to any of the preceding paragraphs of this Section
4.05.
(8) (a) The adjustments provided for in this Section 4.05 are cumulative
and shall, in the case of adjustments to the conversion price, be computed to
the nearest $0.001 (one one-hundredth of a cent) and shall be made successively
whenever an event referred to herein occurs, subject to the following clauses of
this subsection.
(b) No adjustment in the conversion price shall be required unless
such adjustment would result in a change of at least one percent (1%) in the
current conversion price; provided, however, that any adjustments which except
for the provisions of this clause would otherwise have been required to be made
shall be carried forward and taken into account in any subsequent adjustment.
(c) No adjustment in the conversion price or in the number of Shares
issuable upon conversion of Debentures shall be made in respect of any event
described in Section 4.05, other than the events referred to in clauses
4.05(2)(c) and (d), if holders of Debentures are entitled to participate in such
event on the same terms, mutatis mutandis, as if they had converted their
Debentures prior to or on the effective date or record date of such event.
(d) No adjustment in the conversion price shall be made pursuant to
Section 4.05 in respect of the issue from time to time of Shares issuable on
conversion of the Debentures or in respect of the issue from time to time as
dividends paid in the ordinary course as Shares to holders of Shares who
exercise an option or election to receive substantially equivalent dividends in
Shares in lieu of receiving a cash dividend, and any such issue shall be deemed
to be a Share Reorganization.
(e) If at any time a dispute arises with respect to adjustments
provided for in Section 4.05, such dispute shall be conclusively determined by
the Company's auditors, or if they are unable or unwilling to act, by such other
nationally recognized independent chartered accountants as may be selected by
action of the Directors and any such determination shall be binding upon the
Company, the Trustee, the holders of Debentures and shareholders of the Company;
such auditors or accountants shall
be given access to all necessary records of the Company. If any such
determination is made, the Company shall deliver a certificate to the Trustee
describing such determination.
(f) If after the date of this Indenture, the Company takes any
action affecting the Shares, other than action described in Section 4.05, which
in the opinion of the Directors would materially affect the rights of the
holders of Debentures, the conversion price or the number of Shares issuable
upon conversion shall be adjusted in such manner, if any, and at such time, as
the Directors, in their sole discretion, may determine to be equitable in the
circumstances, but subject in all cases to any necessary regulatory approvals.
Failure of the taking of action by the directors so as to provide for an
adjustment on or prior to the effective date of any action by the Company
affecting the Shares shall be conclusive evidence that the directors have
determined that it is equitable to make no adjustment in the circumstances.
(g) If the Company sets a record date to determine the holders of
Shares for the purpose of entitling them to receive any dividend or distribution
or sets a record date to take any other action and thereafter and before the
distribution to such shareholders of any such dividend or distribution or the
taking of any other action, legally abandons its plan to pay or deliver such
dividend or distribution or take such other action, then no adjustment in the
conversion price or the number of Shares issuable upon conversion of any
Debenture shall be required by reason of the setting of such record date.
(h) In the absence of a resolution of the Directors fixing a record
date for a Special Distribution or Rights Offering, the Company shall be deemed
to have fixed as the record date therefor the date on which the board passed the
resolution approving the Special Distribution or Rights Offering.
(i) As a condition precedent to the taking of any action which would
require any adjustment to the conversion price or conversion terms of the
Debentures, the Company shall take all corporate action which may, in the
opinion of counsel, be necessary in order that the Company will have unissued
and reserved in its authorized capital and may validly and legally issue as
fully paid and non-assessable all the shares or other securities which all the
holders of the Debentures are entitled to receive on the full conversion thereof
in accordance with the provisions thereof.
4.06 Postponement of Subscription
In any case in which this Article 4 requires that an adjustment is to be
effective immediately after a record date for an event referred to herein, the
Company may defer, until the occurrence of such an event:
(a) issuing to the holder of any Debenture converted after such record
date and before the occurrence of such event, the additional Shares
issuable upon such conversion by reason of the adjustment required
by such event; and
(b) delivering to such holder any distributions declared with respect to
such additional Shares after such exercise date and before such
event;
provided, however, that the Company delivers to such holder an appropriate
instrument evidencing such holder's right, upon the occurrence of the event
requiring the adjustment, to an adjustment in the conversion price or the number
of Shares issuable on the conversion of any Debenture and to such distributions
declared with respect to any additional Shares issuable on the conversion of any
Debenture.
4.07 Treatment of Fractions
The Company shall not be required to issue fractional Shares upon a
conversion of Debentures pursuant to this Article 4. If any fractional interest
in a Share would, except for the provisions of this Section 4.07, be deliverable
upon the conversion of any Debenture, the Company shall adjust such fractional
interest by payment to the holder of such Debenture of an amount in cash equal
(computed, in
the case of a fractional of a cent, to the next lower cent) to the value of such
fractional interest computed on the basis of the current Conversion Price for
Shares.
4.08 Notice of Adjustment
At least twenty-one (21) days before the effective date of or record date
for any event referred to in Section 4.05 hereof, the Company shall (i) file
with the Trustee and with the transfer agent for Shares of the Company an
Officer's Certificate showing the adjusted Conversion Price or adjusted
conversion terms, as the case may be, determined as provided in Section 4.05
hereof and setting forth in reasonable detail the facts requiring the adjustment
of the conversion price or conversion terms, as the case may be, and the manner
of determining such adjustment, and (ii) give notice, in accordance with Section
2.09 hereof, to the holders of the Debentures stating the particulars of the
event and the adjustments required. The Trustee shall keep such certificate on
file and available for inspection by Debentureholders during reasonable business
hours.
The Trustee may for all purposes act and rely upon the Officer's
Certificate submitted to it pursuant to this Section 4.08. Except as provided in
Section 12.02, the Trustee shall not at any time be under any duty or
responsibility to any Debentureholder to determine whether any facts exist which
may require any adjustment contemplated by Section 4.05, or with respect to the
nature or extent of any such adjustment when made, or with respect to the method
employed in making the same.
4.09 Notice of Maturity
At least twenty-one (21) days prior to the date that the right to convert
the Debentures into Shares is to expire, whether or not in consequence of the
fact that the Debentures are to mature, the Company shall give notice to the
holders of all registered Debentures, in the manner set forth in Section 2.09
hereof, of such expiry and of the date thereof, unless such expiry will be by
virtue of Debentures having been called for redemption prior to their maturity
date, notice of which redemption has then been provided to the holders of the
Debentures to be redeemed.
ARTICLE 5
GUARANTEE AND SECURITY
5.01 Guarantee of Debentures
(1) The Guarantor covenants with the Trustee on behalf of the holders that
the Company will pay and the Guarantor hereby unconditionally guarantees the due
and punctual payment of the principal amount of, and interest on (including, in
case of default, interest on the amount in default), each Debenture when and as
the same becomes due and payable whether at their respective due dates on
redemption or on maturity or otherwise in accordance with the terms of such
Debenture and of this Indenture (the "Guarantee"); provided, however, that
payment of interest on overdue instalments of interest is hereby guaranteed only
to the extent permitted by applicable law.
(2) In case of default by the Company in the payment of any such principal
or interest, the Guarantor agrees duly and punctually to pay the same without
demand. The Guarantor hereby agrees that its obligations under the Guarantee
shall be unconditional, irrespective of any invalidity, illegality, irregularity
or unenforceability of any Debenture or this Indenture with regard to the
Company (other than by reason or lack of genuineness), or the absence of any
action to enforce the same, the recovery of any judgment against the Company or
any action to enforce the same or any circumstances which might otherwise
constitute a legal or equitable discharge or defence of a guarantor. The
Guarantor hereby
waives diligence, presentment, demand of payment, the filing of claims with a
court in the event of merger, amalgamation, insolvency or bankruptcy of the
Company, any right to require a proceeding first against the Company, protest or
notice with respect to any Debenture or the indebtedness evidenced thereby and
all demands whatsoever, and covenants that its obligations under this Section
5.01 will not be discharged as to any Debenture except by payment in full of the
principal of and interest on such Debenture.
(3) The Guarantee is a direct obligation of the Guarantor and shall be
secured by a charge on substantially all of the assets of the Guarantor
substantially in the form appended hereto as Schedule "B", such charge ranking
in priority to all other current and future indebtedness of the Guarantor,
subject to any exceptions prescribed by law and subject to Article 6.
(4) In the case of default by the Company the Trustee shall not be bound
or obligated to proceed against the Company or to take any other action before
being entitled to demand payment from the Guarantor hereunder.
(5) The obligation of the Guarantor under this Indenture shall be a
continuing obligation and a fresh cause of action hereunder shall be deemed to
arise in respect of each default.
(6) The Guarantor shall not be or become liable hereunder or under any
Debenture to make any payment of principal or interest in respect to which the
Company shall be in default if the default of the Company in respect of which
the Guarantor would otherwise be or become liable hereunder or under any
Debenture shall have been waived or directed to be waived pursuant to the
provisions in that behalf contained in this Indenture, provided, however, that
no waiver or consent of any kind whatsoever shall release, alter or impair the
unconditional obligation of the Guarantor hereunder or under any Debenture after
giving effect to such waiver or consent.
(7) The Guarantor shall be subrogated to all rights of the holder of each
Debenture and the holders of any interest therein against the Company in respect
of any amount paid by the Guarantor pursuant to the provisions of the Guarantee;
provided, however, that the Guarantor shall not be entitled to enforce, or to
receive any payments arising out of or based upon, such right or subrogation
until the principal of and interest on all Debentures shall have been paid in
full.
(8) No remedy for the enforcement of the rights of the holder of any
Debenture to receive payment of the principal of or interest on, or both, any
Debenture in accordance with its terms under this Indenture or under such
Debenture shall be exclusive of or dependent on any other remedy.
(9) If any monies become payable by the Guarantor hereunder, the Trustee
shall be entitled to enforce the Guarantee and receive payment thereof by the
Guarantor, for the benefit of the holders of the Debentures, and shall be
entitled to recover judgment against the Guarantor for any portion of the same
remaining unpaid and the Trustee shall have further remedies with respect to the
Guarantor similar to the remedies granted to it in Article 8 with respect to the
Company. The whole of the monies from time to time received by the Trustee
hereunder shall be applied by the Trustee in accordance with the provisions of
Section 8.05.
5.02 Gross-up for Withholding Taxes on Payments by the Guarantor under
Debentures
Any and all payments by the Guarantor pursuant to the provisions of
Section 5.01 shall be made without withholding of or deduction for, or on
account of, any present or future taxes imposed by or on behalf of the United
States or any political subdivision thereof unless such taxes are required by
law or by the administration thereof to be withheld or deducted, in which case
the Guarantor shall pay such additional amounts as will result (after the
withholding or deduction of such taxes) in the payment to the holders of the
Debentures of the amounts which would otherwise have been payable pursuant to
Section 5.01; provided, however, that the foregoing obligation to pay additional
amounts will not apply to any one or more of the following:
(1) any tax, assessment or other governmental charge that would not have
been so imposed but for (i) the existence of any present or former
connection between a Debentureholder (or between a fiduciary,
settlor, beneficiary or member of a Debentureholder, if such
Debentureholder is an estate, a trust or a partnership) and the
United States, including, without limitation, such Debentureholder
(or such fiduciary, settlor, beneficiary or member) being or having
been a citizen or resident or treated as a resident thereof, or
being or having been engaged in a trade or business or present
therein, or having or having had a permanent establishment therein
but excluding a connection consisting solely of the holder or use
outside of the United States or ownership as a non-resident and
non-citizen of the United States of a Debenture and the Guarantee in
respect thereof, or (ii) such Debentureholder's present or former
status as a personal holding company, a foreign personal holding
company, a controlled foreign company for United States tax
purposes, a private foundation or other tax exempt organization or a
company that accumulates earnings to avoid United States Federal
income tax;
(2) any tax, assessment or other governmental charge imposed on interest
received by a person holding, actually or constructively, 10% or
more of the total combined voting power of all classes of stock of
the Company or the Guarantor entitled to vote;
(3) any tax, assessment or other governmental charge which would not
have been imposed but for the failure to comply with any
certification, identification or other reporting requirements
concerning the nationality, residence, identity or connection with
the United States of the holder or beneficial owner of such
Debenture, if compliance is required by the statute or by regulation
of the United States Treasury Department as a precondition to
exemption from such tax, assessment or other governmental charge;
(4) any estate, inheritance, gift, sales, transfer, personal property or
any similar tax, assessment or governmental charge;
(5) any tax, assessment or other governmental charge which would not
have been so imposed but for the presentation by the holder of such
Debenture for payment on a date more than 30 days after the date on
which such payment became due and payable or the date on which
payment thereof is duly provided for, whichever occurs later;
nor will additional amounts be paid (i) with respect to any payment of principal
of or interest on any such Debenture to any Debentureholder who is a fiduciary
or partnership or other than the sole beneficial owner of any such payment to
the extent that a beneficiary or settlor with respect to such fiduciary, a
member of such a partnership or the beneficial owner would not have been
entitled to the additional amounts had such beneficiary, settlor, member or
beneficial owner been the holder of such Debenture, or (ii) to a foreign
partnership unless one or more of the members of the partnership is, for United
States Federal income tax purposes, a foreign company, a non-resident alien
individual or a non-resident alien fiduciary of a foreign estate or trust.
5.03 Further Assurances
The Guarantor shall, subject as herein provided, forthwith, and from time
to time, execute and do or cause to be executed and done all deeds, documents
and things which, in the opinion of counsel, are necessary or advisable for
giving the Trustee charges over the assets of the Guarantor to secure the
payment of all principal monies and interest for the time being and from time to
time owing pursuant to this Indenture and the Debentures.
5.04 Registration
The Guarantor shall record, file, enter or register the security agreement
set out as Schedule "B" hereto, all agreements supplemental hereto and all other
instruments or further assurances without delay (wherever in the opinion of
counsel it would be of material advantage in preserving and protecting the
security interest created thereby and the rights of the Debentureholders and the
Trustee hereunder for such action to be taken) under the provisions of any and
all statutes providing for or permitting the registration of such security in
any province or territory of Canada and any state, territory or possession of
the United States of America in which assets of the Guarantor are situated or
the business of the Guarantor is carried on; and the Guarantor shall renew such
recordings, filings, enterings or registrations from time to time as and when
required.
5.05 Authority to Charge and Maintenance of Security
The Guarantor covenants with the Trustee:
(a) it has good right and lawful authority to charge its undertaking,
property, rights and assets as provided in and by this Indenture;
and
(b) it will fully and effectually maintain and keep maintained the
security provided for in this Article 5 as valid and effective
security at all times so long as any of the Debentures shall be
outstanding.
5.06 Release and Discharge
(1) The obligation and liability of each of the Guarantor and the Company
under this Indenture, except as otherwise provided in this Indenture, shall not
be released, discharged or in any way affected by any release, discharge, loss
or alteration in or dealing with the secured assets or any part thereof or
anything done, suffered or permitted by the Trustee in relation to any of the
secured assets; or by any extension of time for payment of the Debentures; or by
any modification of any of the Debentures or this Indenture; or by any
forebearance whatsoever, whether as to time, performance or otherwise; or by any
compromise, arrangement or plan or reorganization affecting the Company, the
Guarantor or the security under or pursuant to this Indenture; or by any other
matter or thing whatsoever which would release a guarantor or principal obligor,
as the case may be (except payment in full of the principal of and interest on
the Debentures).
(2) It is understood and agreed that the charges created pursuant to this
Indenture shall be held by the Trustee as security for the performance by the
Company and the Guarantor of their respective covenants herein contained and
that upon the Company becoming entitled to a discharge of this Indenture, then
these presents and the estate and rights by this Indenture granted shall cease
and become utterly null and void and the secured assets shall revert to and
revest in the Guarantor without any release, acquittance or any act or formality
whatsoever; and thereupon the Trustee shall, at the request and at the expense
of the Guarantor and the Company, execute and deliver to the Guarantor and the
Company such instruments as shall be requisite to evidence the satisfaction and
discharge of the security contemplated hereby, and to release or reconvey to the
Guarantor the secured assets freed and discharged from the trusts and
provisions, and to release each of the Guarantor and the Company from their
covenants in this Indenture.
ARTICLE 6
SUBORDINATION
6.01 Subordination of Debentures
The indebtedness evidenced by the Debentures, including the principal
thereof and interest thereon shall be and is hereby expressly made subordinate
and subject in right of payment, to the extent and in the manner set forth in
this Article 6, to the prior payment in full of all Senior Indebtedness whether
now outstanding or hereafter incurred.
6.02 Payment of Proceeds in Certain Events
(1) Subject to Section 6.06, in the event of any distribution of the
assets of the Company upon any dissolution or winding up or partial or total
liquidation of the Company, whether in bankruptcy, insolvency or receivership
proceedings, or upon an assignment for the benefit of creditors or any other
marshalling of the assets and liabilities of the Company, or any reorganization
or insolvency of the Company:
(a) all Senior Indebtedness shall first be paid in full or provision
made for such payment before any payment is made on account of the
principal of and interest on the Debentures; and
(b) any payment or distribution of assets of the Company, whether in
cash, property or securities, to which the holders of the Debentures
would be entitled except for the provisions of this Article 6, shall
be paid or delivered by the trustee in bankruptcy, receiver,
assignee for the benefit of creditors or other liquidating agent
making such payment or distribution, directly to the Designated
Representatives or to the holders of Senior Indebtedness to the
extent necessary to pay all Senior Indebtedness in full after giving
effect to any concurrent payments or distribution or provision
therefor to or for the benefit of the holders of Senior
Indebtedness, and the holders of the Debentures by acceptance
thereof assign to the Designated Representatives or to the holders
of Senior Indebtedness for the purposes and to the extent set forth
in this Section 6.02(b) all their right, title and interest in and
to any such payment or distribution of the assets of the Company as
aforesaid to which the holders of the Debentures or the Trustee for
their benefit would be entitled except for the provisions of this
Section 6.02(b); and the holders of the Debentures authorize and
direct the Trustee to take such steps as may be necessary or
appropriate to entitle the Designated Representatives or the holders
of Senior Indebtedness to receive rateably such payment or
distribution from the liquidating trustee or agent or other person
making such payment or distribution;
and if, notwithstanding the foregoing, any payment or distribution of assets of
the Company, whether in cash, property or securities, shall be received by the
holders of the Debentures or by the Trustee on behalf of such holders before all
Senior Indebtedness is paid in full, or provision is made for its payment, such
payment or distribution shall be held in trust for the benefit of the holders of
Senior Indebtedness and shall be paid over or delivered to their Designated
Representatives or to the holders of Senior Indebtedness for application to the
payment of all Senior Indebtedness remaining unpaid.
(2) The consolidation, amalgamation or merger of the Company with another
corporation or the sale, transfer or leasing of its property as a whole or
substantially as a whole to another corporation upon the terms and conditions
provided in Article 9 shall not be deemed a winding up for the purpose of
this Article 6 if such other corporation shall, as part of such consolidation,
amalgamation, merger, sale, transfer or lease, comply with the conditions stated
in Article 9.
6.03 Subrogation to Senior Indebtedness
Subject to the payment in full of all Senior Indebtedness in accordance
with the terms thereof, the holders of the Debentures and the Trustee for the
benefit of such holders shall be subrogated to the rights of the holders of
Senior Indebtedness to receive payments or distribution of assets of the Company
applicable to such Senior Indebtedness, to the extent of the application thereto
of moneys or other assets which would have been received by the holders of
Debentures or by the Trustee for the benefit of such holders but for the
provisions of this Article 6, until the principal of and interest on the
Debentures shall be paid in full; it being understood that the provisions of
this Article 6 are and are intended solely for the purpose of defining the
relative rights of the holders of the Debentures on the one hand and the holders
of the Senior Indebtedness on the other hand, and nothing in this Article 6 or
elsewhere in this Indenture or in the Debentures is intended or shall impair the
obligation of the Company, which is unconditional and absolute, to pay to the
holders of the Debentures the principal of and interest on the Debentures as and
when the same shall become due and payable in accordance with their terms, or to
affect the relative rights of the holders of the Debentures and creditors of the
Company other than the holders of Senior Indebtedness, nor shall anything herein
or in the Debentures prevent the Trustee or the holder of any Debenture from
exercising all remedies otherwise permitted by this Indenture or, except as is
expressly limited hereby or by the Debentures, by applicable law upon default
under the Debentures or this Indenture, subject in any event, to the rights, if
any, under this Article 6 of the holders of Senior Indebtedness in respect of
any payment or distribution of cash, property or securities of the Company
received upon the exercise of any such remedy.
6.04 Senior Indebtedness Default
Upon the happening and during the continuance of a Senior Indebtedness
Default, no payment shall be made by the Company with respect to the principal
of and interest on the Debentures. In the event that, notwithstanding the
foregoing, the Company shall make any payment of principal of or interest on the
Debentures after the happening and during the continuance of a Senior
Indebtedness Default, then such payments received by the Trustee shall be held
in trust for the benefit of the holders of Senior Indebtedness, and shall be
paid over to their Designated Representatives or to the holders of Senior
Indebtedness for application to the payment of all Senior Indebtedness remaining
unpaid. Unless and until written notice has been given to the Trustee by or on
behalf of any holder of any Senior Indebtedness, notifying the Trustee of the
happening of an event of default with respect to such Senior Indebtedness or of
the existence of any other facts which would result in the making of any payment
with respect to the Debentures in contravention of the provisions of this
Article 6, the Trustee shall be entitled to assume that no such event of default
has occurred, or that no such facts exist, and, with respect to any moneys which
may at any time be received by the Trustee in trust pursuant to the provisions
of this Trust Indenture, prior to the receipt by it of such written notice,
nothing in this Indenture will prevent the Trustee from applying such moneys to
the purposes for which the same were so received, notwithstanding the occurrence
or continuance of an event of default with respect to or the existence of such
facts with respect to such Senior Indebtedness.
6.05 Notice to Trustee of Senior Indebtedness Default
The Company shall give prompt written notice to the Trustee of any
dissolution, winding up or liquidation of the Company within the meaning of this
Article 6 or of any Senior Indebtedness Default. The Trustee and the holders of
the Debentures shall be entitled to assume that no such event has occurred
unless the Company has given such notice and, in the case of notice given of any
Senior Indebtedness Default, that such default is continuing until the Company
gives written notice to the Trustee that such default has ceased to exist. Upon
any payment or distribution of assets of the Company referred to in this Article
6, the Trustee and the holders of the Debentures shall be entitled to rely upon
a certificate of the trustee in bankruptcy, receiver, assignee for benefit of
creditors or other liquidating agents making such payment or distribution,
delivered to the Trustee or to the holders of Debentures, for the purpose of
ascertaining the persons entitled to participate in such distribution, the
holders of the Senior Indebtedness and other indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article 6.
6.06 Certain Exceptions
Nothing contained in this Article 6 or elsewhere in this Indenture or in
any of the Debentures shall prevent:
(a) the Company from making payment of the principal of or interest on
the Debentures at any time except upon and during the continuance of
a Senior Indebtedness Default or during the pendency of any
dissolution or winding up or partial or total liquidation of the
Company (whether in bankruptcy, insolvency or receivership
proceedings), or upon an assignment for the benefit of creditors or
any other marshalling of the assets and liabilities of the Company
or during any reorganization or insolvency of the Company;
(b) the Trustee from applying to the payment of principal of and
interest on the Debentures, monies deposited with it for such
purpose; or
(c) the Company from completing any purchase or redemption of Debentures
except during the pendancy of any Senior Indebtedness Default.
The provisions of this Section 6.06 shall not be applicable to any cash,
securities or other property received by the holder of any Debenture or by the
Trustee by virtue of being a holder of Senior Indebtedness.
6.07 Failure to Act Not a Waiver
No right of any present or future holder of any Senior Indebtedness of the
Company to enforce subordination as herein provided shall at any time in any way
be prejudiced or impaired by any act or failure to act on the part of the
Company or by any act or failure to act in good faith, by any such holder, or by
any non-compliance by the Company with the terms, provisions and covenants of
this Indenture, regardless of any knowledge thereof any such holder may have or
with which he may be otherwise charged.
6.08 Renewal or Extension of Senior Indebtedness
A holder of Senior Indebtedness may at any time in his or her discretion
renew or extend the time of payment of the Senior Indebtedness so held or
exercise any other of his or her rights under the Senior Indebtedness,
including, without limitation, the waiver of default thereunder, all without
notice to or assent from the holders of the Debentures or the Trustee.
6.09 Trustee to be Agent of Holders
Each holder of Debentures by his or her acceptance thereof irrevocably
authorizes and directs the Trustee on his or her behalf to take such further
action as may be necessary or appropriate further to assure the subordination as
provided in this Article 6 and appoints the Trustee his or her agent for any and
all such purposes. Without limitation of the foregoing, the Trustee for and on
behalf of the holders from time to time of all the Debentures is authorized and
directed, upon the written request of the Company, to execute from time to time
deeds of subordination in favour of such Designated Representatives or to such
holders of Senior Indebtedness as are specified in such request and to deliver
executed counterparts
thereof to each such Designated Representative or holder as aforesaid. The
Company shall keep on file at its registered office copies of all deeds of
subordination executed and delivered by it pursuant to this Section 6.09 and
such copies shall be open to inspection by any of the holders of Debentures or
Senior Indebtedness at such office during regular business hours. Each such deed
of subordination shall be conclusive evidence that the indebtedness specified
therein is Senior Indebtedness. Nothing herein contained shall impair the rights
of any Designated Representative or any holders of Senior Indebtedness who have
not entered into such a deed of subordination.
6.10 Company to Issue Certificates of Senior Indebtedness
The Company covenants that during the currency of any event of default or
any event which with notice or lapse of time, or both, would become an event of
default, it will within a reasonable period of time following the request of the
Trustee to do so prepare and deliver to the Trustee an Officers' Certificate
showing in reasonable detail the Senior Indebtedness outstanding as of the date
of such certificate by series, issue or class and the Designated Representatives
of each series, issue or class or the holders of each series, issue or class
insofar as such holders are known to the Company. The Trustee may conclusively
act and rely on each such Officers' Certificate.
ARTICLE 7
CERTAIN COVENANTS OF THE COMPANY
7.01 General Covenants of the Company
The Company will well and truly perform and carry out all of the actions
or things to be done by it as provided in this Indenture. The Company hereby
covenants and agrees that:
(a) Payment of Principal and Interest. It will well, duly and punctually
pay or cause to be paid to every Debentureholder the principal of
and interest accrued on the Debentures of which he or she is the
holder at the dates and places, in the monies and in the manner,
provided for herein and in the Debentures.
(b) To Carry on Business. It will at all times maintain its corporate
existence and diligently carry on and conduct its business in a
proper, efficient and businesslike manner and shall not cease to
operate the whole or substantially the whole of its business except
in accordance with Article 9, and will keep, or cause to be kept,
proper books of account and make, or cause to be made, in accordance
with generally accepted accounting principles therein true and
faithful entries of all dealings and transactions in relation to its
business and at all reasonable times furnish, or cause to be
furnished, to the Trustee or its duly authorized agent or attorney
such information relating to its business as the Trustee may
reasonably require, and such books of account shall at all
reasonable times be open for inspection by the Trustee or such agent
or attorney as the Trustee may from time to time by instrument in
writing for that purpose appoint.
(c) To Pay Taxes. It will from time to time pay or cause to be paid all
taxes, rates, levies, assessments, ordinary or extraordinary,
government fees or dues lawfully levied, assessed or imposed upon or
in respect of its property (real or personal), assets and
undertaking or any part thereof or upon the income and profits of
the Company as and when the same become due and payable, and that it
will exhibit or cause to be exhibited to the Trustee when requested
the receipts and vouchers establishing such payments, and will duly
observe and conform to all valid requirements of any governmental
authority relative to any of its property or rights which are
material to its overall undertaking, provided, however, that the
Company shall have the right to contest in good faith by legal
proceedings any such taxes, rates, levies, assessments, government
fees or dues and, upon such contest, may delay or defer payment or
discharge thereof if the Company shall have set aside on its books
reserves (segregated to the extent required by sound accounting
practice) deemed by it to be adequate with respect thereto, or if in
the opinion of the Directors, the failure to pay and discharge
promptly the same shall be in the interests of the Company and not
disadvantageous in any material respect to the Debentureholders.
(d) To Maintain Insurance. It will insure and keep insured against loss
or damage by fire its buildings, plants and other properties and
things which are of an insurable nature and of a character usually
insured by prudent corporations carrying on similar operations under
like circumstances, and that it will carry such other insurance as
is usually carried by prudent corporations carrying on similar
operations under like circumstances, and that it will pay, duly and
seasonably, the premiums and other sums of money payable in respect
of such insurance and will exhibit to the Trustee on demand the
receipts for such premiums.
(e) Financial Statements. It will furnish to the Trustee, and such
Debentureholders as shall request the same, (i) within 140 days (or
such longer period as the Trustee in its discretion may consent to)
after the end of its fiscal year, a copy of the consolidated
financial statements and of the report of the Company's auditors
thereon which are furnished to the shareholders of the Company, and
(ii) within 60 days (or such longer period as the Trustee in its
discretion may consent to) after the end of the first, second and
third quarterly accounting periods in each fiscal year, a copy of
the consolidated balance sheet as at the end of such quarterly
accounting period, the related statements of income, retained
earnings and changes in the financial position for the period
commencing with the last day of the previous fiscal year and ending
with the last day of such quarterly accounting period, all certified
by a principal financial or accounting officer of the Company to
present fairly the information contained therein, subject to
year-end and audit adjustments.
(f) Pay Trustee's Remuneration. It will pay to the Trustee reasonable
remuneration for its services as Trustee hereunder and will repay to
the Trustee on demand all monies which shall have been paid by the
Trustee in and about the execution of the trusts hereby created
(including the reasonable compensation and disbursements of its
counsel and all other advisors and assistants not regularly in its
employ but excluding any expense, disbursement or advance as may
arise from the negligence or wilful default of the Trustee), with
interest at the then prevailing prime rate from the date on which
the Trustee notifies the Company of such expenditure until actual
repayment, and such monies and the interest thereon, including the
Trustee's remuneration, shall be payable out of any monies held by
the Trustee under this Indenture in priority to the Debentures. The
said remuneration shall continue payable until the trusts hereof
shall be finally satisfied.
(g) Default. If it should be in default hereunder at any time it will
promptly, after it has become aware of same, give notice to the
Trustee of the occurrence of an event of default or an event which,
with the giving of notice or lapse of time, or both, would become an
event of default; provided, however, that in the event of any
Debentures being issued, re-issued or substituted during the
continuance of such default of which the Trustee is not aware and
being treated by the Trustee as entitled to the benefit hereof, the
Trustee shall not thereby incur any responsibility.
(h) Securities Laws. It will at all times preserve and remain its status
as a "reporting issuer" not in default under the Securities Act
(Ontario) and will, in a timely fashion, file and deposit all
documents and reports with the Ontario Securities Commission and
similar
securities regulatory authorities required to be filed or deposited
pursuant to applicable legislation.
(i) Debentures. The Debentures, when issued and certified as herein
provided, will be valid and enforceable against the Company and,
subject to the provisions of this Indenture, the Company will cause
the Shares acquired pursuant to the conversion of the Debentures to
be duly issued and delivered in accordance with the Debentures and
the terms thereof. At all times prior to the maturity of the
Debentures, while any of the Debentures are outstanding, the Company
shall reserve and keep available out of its authorized capital,
solely for the purpose of issue upon the exercise of the right of
conversion of Debentures, and there shall be conditionally allotted
but unissued, a number of Shares sufficient to enable the Company to
meet its obligations hereunder.
(j) Notice to Regulatory Authorities. It shall give written notice of
the issue of the Shares pursuant to the conversion of the
Debentures, if required and in such detail as may be required, to
each securities regulatory authority in each relevant jurisdiction
pursuant to applicable law.
(k) Further Assurances. It shall do, execute and acknowledge and deliver
or cause to be done, executed acknowledged and delivered, all other
acts, deeds and assurances as the Trustee may reasonably require for
the better accomplishing and effecting the intentions and provisions
of this Indenture.
7.02 General Covenants of the Guarantor
The Guarantor will well and truly perform and carry out all of the actions
or things to be done by it as provided in this Indenture. The Guarantor hereby
covenants and agrees that:
(a) To Carry on Business. It will at all times maintain its corporate
existence and diligently carry on and conduct its business in a
proper, efficient and businesslike manner and shall not cease to
operate the whole or substantially the whole of its business except
in accordance with Article 9, and will keep, or cause to be kept,
proper books of account and make, or cause to be made, in accordance
with generally accepted accounting principles therein true and
faithful entries of all dealings and transactions in relation to its
business and at all reasonable times furnish, or cause to be
furnished, to the Trustee or its duly authorized agent or attorney
such information relating to its business as the Trustee may
reasonably require, and such books of account shall at all
reasonable times be open for inspection by the Trustee or such agent
or attorney as the Trustee may from time to time by instrument in
writing for that purpose appoint.
(b) To Pay Taxes. It will from time to time pay or cause to be paid all
taxes, rates, levies, assessments, ordinary or extraordinary,
government fees or dues lawfully levied, assessed or imposed upon or
in respect of its property (real or personal), assets and
undertaking or any part thereof or upon the income and profits of
the Guarantor as and when the same become due and payable, and that
it will exhibit or cause to be exhibited to the Trustee when
requested the receipts and vouchers establishing such payments, and
will duly observe and conform to all valid requirements of any
governmental authority relative to any of its property or rights
which are material to its overall undertaking, provided, however,
that the Guarantor shall have the right to contest in good faith by
legal proceedings any such taxes, rates, levies, assessments,
government fees or dues and, upon such contest, may delay or defer
payment or discharge thereof if the Guarantor shall have set aside
on its books reserves (segregated to the extent required by sound
accounting practice) deemed by it to be adequate with respect
thereto, or if in the opinion of the Directors, the failure to pay
and discharge promptly the same shall be in the interests of the
Guarantor and not disadvantageous in any material respect to the
Debentureholders.
(c) To Maintain Insurance. It will insure and keep insured against loss
or damage by fire its buildings, plants and other properties and
things which are of an insurable nature and of a character usually
insured by prudent corporations carrying on similar operations under
like circumstances, and that it will carry such other insurance as
is usually carried by prudent corporations carrying on similar
operations under like circumstances, and that it will pay, duly and
seasonably, the premiums and other sums of money payable in respect
of such insurance and will exhibit to the Trustee on demand the
receipts for such premiums.
(d) Negative Pledge. Except as otherwise provided in this Indenture, it
will not, as long as any of the Debentures remain outstanding,
create, incur or permit any Security, other than the Senior
Indebtedness, on any of its current or after acquired assets or
undertakings to secure any obligations or indebtedness unless such
Security is subordinate to the Security granted to the Trustee on
behalf of the Debentureholders pursuant to the Security Agreement
attached hereto as Schedule "B".
(e) Subsequent Filings. It will file all necessary applications,
documents or materials required to be filed with any United States,
Canadian or other foreign patent application which corresponds to
the invention(s) disclosed in the Patent.
7.03 Representations and Warranties of the Company and the Guarantor
Each of the Company and the Guarantor represent and warrant to the Trustee
on behalf of the Debentureholders that the Guarantor is the duly registered
holder of the Patent.
7.04 Trustee may Perform Covenants
If the Company shall fail to perform any of the covenants or fulfil any of
the conditions contained in this Indenture or in the Debentures, the Trustee may
in its discretion perform, but shall be under no obligation to do so, any of the
said covenants or fulfil any such condition capable of being performed or
fulfilled by it and, if any such covenant or condition requires the payment or
expenditure of money, it may make such payments or expenditures with its own
funds, or with money borrowed by or advanced to it for such purpose; and all
sums so expended or advanced shall be at once payable by the Company and shall
bear interest at the then prevailing prime rate until paid and shall be payable
out of any monies held by the Trustee under this Indenture in priority to the
Debentures, but no such performance or payment shall be deemed to relieve the
Company from any default hereunder.
7.05 No Other Convertible Obligation to Rank Ahead of Debentures
The Company hereby covenants with the Trustee for the benefit of the
holders of the Debentures that it will not, so long as any of the Debentures
remain outstanding, issue any obligations convertible into shares in the capital
of the Company pursuant to a trust indenture or like document, unless the same
rank pari passu with or are subordinate in right of payment of principal,
premium (if any), and interest to the Debentures.
7.06 Company Not to Extend Time for Payment of Interest
In order to prevent any accumulation after maturity of interest, the
Company hereby covenants that it will not, directly or indirectly, extend or
assent to the extension of any time for payment of interest upon any Debentures
issued hereunder, and that it will not, directly or indirectly, be a party to or
approve any such arrangement. In case the time for payment of any such interest
shall be so extended, whether or not such extension shall be by or with the
consent of the Company, such interest shall not be entitled, in case of default
hereunder, to the benefit of these presents except subject to the prior payment
in full of the principal of all the Debentures then outstanding, and of all
interest on such Debentures the payment of which has not been so extended.
7.07 Annual Compliance Certificate
On each anniversary of the date hereof, and at any other time if requested
by the Trustee, the Company will deliver to the Trustee an Officer's Certificate
stating that the Company has complied with all covenants, conditions or other
requirements contained in this Indenture the non-compliance with which would,
with the giving of notice or the lapse of time, or both, constitute an event of
default under this Indenture, or if such is not the case, specifying the
covenant, condition or other requirement which has not been complied with and
giving particulars of such non-compliance.
ARTICLE 8
EVENTS OF DEFAULT
8.01 Events of Default
If one or more of the following events (herein called "events of default")
shall happen, that is to say:
(a) default shall be made in the payment of the principal of any of the
Debentures when the same becomes due and payable; or
(b) default shall be made in the payment of any interest due on any of
the Debentures issued hereunder and such default shall have
continued for a period of twenty-one (21) days; or
(c) any Senior Indebtedness Default shall occur and such default shall
continue beyond the period of grace, if any, specified in the
indenture or agreement under which such Senior Indebtedness is
issued and shall not have been waived; or
(d) the Company or any of its Subsidiaries shall generally not pay its
debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against the Company or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding-up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of
debtors (including, without limitation, the Companies' Creditors
Arrangement Act), or seeking the entry of an order for relief or the
appointment of a receiver, trustee, or other similar official for it
or for any substantial part of its property and, in the case of any
such proceeding remaining undismissed or unstayed for a period of
thirty (30) days or any of the actions sought in such proceeding
(including, without limitation, the entry of an order for relief
against it or the appointment of a receiver, trustee, custodian or
other similar official for it or for any substantial part of its
property) shall occur; or the Company or such Subsidiary shall take
any corporate action to authorize any of the actions set forth in
this Subsection 8.01(c); provided that a resolution or order for
winding-up the Company with a view to its consolidation,
amalgamation or merger with another corporation or the transfer of
its assets as a whole, or substantially as a whole, to such other
corporation, as provided in Article 8 shall not constitute an event
of default if such last mentioned corporation shall, as part of such
consolidation, amalgamation, merger or transfer comply with the
conditions to that end stated in Article 9; or
(e) any process of execution be enforced or levied upon any of the
property of the Company or the Guarantor and remain unsatisfied for
a period of ten (10) business days, provided that such process is
not in good faith disputed by the Company or the Guarantor, and
either the Company or the Guarantor shall have given security which,
in the discretion of the Trustee, shall be sufficient to pay in full
the amount claimed in the event that it shall be held to be valid
claim; or
(f) the Guarantor fails to observe or perform any of its covenants
contained in Article 5 and Subsection 6.02;
(g) the Company fails to observe or perform any of its covenants
contained in Article 7 of this Indenture, except as provided in
Subsection 8.01(b); or
(h) default shall be made in the due observance or performance of any
other covenant or condition in this Indenture required to be
observed or performed by the Company or the Guarantor and any such
default shall continue for a period of thirty (30) days after notice
received by the Company or the Guarantor from the Trustee specifying
such default and requiring the Company or the Guarantor to rectify
such default and any such notice may be given by the Trustee on its
own initiative and shall be given at the written request of the
holders of not less than twenty-five percent (25%) of the aggregate
principal amount of the Debentures issued hereunder at the time
outstanding;
then in each and every such event the Trustee, subject to the provisions of
Section 8.02 hereof, may in its discretion and shall upon the request in writing
of the holders of not less than twenty-five percent (25%) in principal amount of
the Debentures then outstanding, declare the principal of, and interest on, all
the Debentures outstanding hereunder, together with all other monies payable
hereunder, to be due and payable and the same shall forthwith become immediately
due and payable to the Trustee, anything therein or herein to the contrary
notwithstanding, and the Company shall pay forthwith to the Trustee the amount
of the principal of and interest then accrued on all of the Debentures then
outstanding and all other monies payable hereunder, together with interest on
such principal, interest and other monies at the rate of interest borne by the
Debentures from the date of the said declaration until payment is received by
the Trustee. Such payment when made shall be deemed to have been made in
discharge of the Company's obligations hereunder and under the Debentures and
shall be applied in the manner hereinafter provided in Section 8.05 hereof.
8.02 Notice of Event of Default
(1) If an event of default occurs and is continuing the Trustee shall
within ten (10) business days after it becomes aware of the occurrence of such
event of default, give notice of such event of default to the holders of the
Debentures provided that, notwithstanding the foregoing, the Trustee shall not
be required to give such notice if the Trustee in good faith decides that the
withholding of such notice is in the best interests of the holders of Debentures
and has so advised the Company in writing.
(2) Where notice of the occurrence of an event of default has been given
and the event of default is thereafter cured, notice that the event of default
is no longer continuing shall be given by the Trustee to the holders of
Debentures within a reasonable time, but not exceeding ten (10) business days,
after the Trustee has actual knowledge that the event of default has been cured.
8.03 Waiver of Default
Upon the happening of any event of default hereunder, except default in
payment of principal monies at maturity, and in addition to the powers
exercisable by the Debentureholders by Extraordinary Resolution, the holders of
not less than fifty-one percent (51%) in principal amount of all the Debentures
which shall then be outstanding shall have power by an instrument or instruments
in writing or by affirmative votes of such holders at a meeting duly convened
and held as hereinafter provided to require the Trustee to waive the default and
the Trustee shall thereupon waive the default upon such terms and conditions as
such holders shall prescribe. So long as it has not become bound as provided in
this Article 8 to declare the principal of and interest on all the Debentures
then outstanding to be due and payable, or to obtain and enforce payment of the
same, the Trustee shall have power to waive any default arising hereunder,
except default in payment of principal monies at maturity, if in the opinion of
the Trustee the same shall have been cured, or adequate satisfaction made
therefor, upon such terms and conditions as the Trustee may deem advisable;
provided always that no act or omission either of the Trustee or of the
Debentureholders in the premises shall extend to or be taken in any manner
whatsoever to affect any subsequent default or the rights resulting therefrom.
8.04 Right of Trustee of Enforce Payment
Subject to the provisions of Section 8.03, in case the Company shall fail
to pay to the Trustee, on demand, the principal and interest on all the
Debentures then outstanding, together with any other amounts due hereunder, the
Trustee may in its discretion and, upon the request in writing of the holders of
not less than twenty-five percent (25%) in principal amount of the Debentures
then outstanding and upon being indemnified and funded to its reasonable
satisfaction against all costs, expenses and liabilities to be incurred, shall
proceed in its name as Trustee hereunder to obtain or enforce payment of the
said principal of and interest on all the Debentures then outstanding together
with any other amounts due hereunder, by any remedy provided by law either by
legal proceedings or otherwise including, without limitation, enforcing the
Guarantee provided for in Section 5.01.
8.05 Application of Moneys by Trustee
Except as otherwise herein provided, the monies arising from any
enforcement hereof shall be held by the Trustee and applied by it, together with
any other monies then or thereafter in the hands of the Trustee available for
the purpose, as follows:
(a) firstly, in payment or reimbursement to the Trustee of the
remuneration, expenses, disbursements and advances of the Trustee
earned, incurred or made in the administration or execution of the
trusts hereunder or otherwise in relation to this Trust Indenture
with interest thereon as herein provided;
(b) secondly, but subject to Section 6.06, in payment of the principal
of and accrued and unpaid interest on amounts in default under the
Debentures which shall then be outstanding rateably and
proportionately and without preference or priority or discrimination
as between principal and interest unless otherwise directed by
extraordinary resolution and in that case in such order of priority
as between principal and interest as may be directed by such
resolution; and
(c) the surplus (if any) of such monies shall be paid to the Company or
its assigns.
8.06 Trustee Not Bound to Make Interim Payment
The Trustee shall not be bound to apply or make any partial or interim
payment of any monies coming into its hands if the amount so received by it is
insufficient to make a distribution of at least two percent (2%) of the
aggregate principal amount of the outstanding Debentures, but it may retain the
money so received by it and invest or deposit the same as provided in Article 10
hereof until the money or the investments representing the same, with the income
derived therefrom, together with any other monies for the time being under its
control, shall be sufficient for the said purpose or until it shall consider it
advisable to apply the same in the manner hereinbefore set forth.
8.07 Notice of Payment by Trustee
Not less than twenty-one (21) days' notice shall be given by the Trustee
of any payment to be made under this Article 8 to the Debentureholders. Such
notice shall state the time and place when and where such payment is to be made
and also the liability under this Indenture upon which it is to be applied.
After the day so fixed, unless payment shall have been duly demanded and have
been refused, the Debentureholders shall be entitled to interest only on the
balance (if any) of the principal monies and interest due to them, respectively,
on the Debentures, after deduction of the respective amounts payable in respect
thereof on the day so fixed.
8.08 Trustee May Demand Production of Debentures
The Trustee shall have the right at the time it makes any payment of
principal or interest required by this Article 8 to demand of the person
claiming such payment the production of the actual Debenture under which he
claims such payment be made, and may cause to be endorsed on the same a
memorandum of the amount so paid and the date of payment, but the Trustee may,
in its discretion, dispense with such production and endorsement in any special
case, upon such indemnity being given to it and to the Company as it shall deem
sufficient.
8.09 Trustee Appointed Attorney
The Company hereby irrevocably appoints the Trustee to be the attorney of
the Company for and in the name and on behalf of the Company to execute and do
any deeds, documents, transfers, conveyances, assignments, assurances, consents
and things which the Company ought to sign, execute and do hereunder and
generally to use the name of the Company in the exercise of all or any of the
powers hereby conferred on the Trustee, with full powers of substitution and
revocation.
8.10 Remedies Cumulative
No remedy herein conferred upon or reserved to the Trustee or upon or to
the holders of the Debentures is intended to be exclusive of any other remedy,
but each and every such remedy shall be cumulative and shall be in addition to
every other remedy given hereunder or now existing or hereafter to exist by law
or by statute.
8.11 Covenants for Benefit of Parties and Debentureholders
All the covenants, stipulations and agreements in this Indenture
contained, by or on behalf of the Company to be kept, observed, fulfilled or
performed, are and shall be for the sole and exclusive benefit of the parties
hereto and of the respective holders of the Debentures.
8.12 Judgment Against Company on an Express Trust
The Company covenants and agrees to and with the Trustee that, in the case
of any proceedings to obtain judgment for the principal of or interest on the
Debentures, judgment may be rendered against it in favour of the
Debentureholders hereunder or in favour of the Trustee, as trustee of an express
trust for the Debentureholders hereunder, for any amount which may remain due in
respect of the Debentures and interest thereon.
ARTICLE 9
CONSOLIDATION AND AMALGAMATION
9.01 Successor Company or Guarantor
(1) Nothing in this Indenture or in any Debenture shall prevent, if
otherwise permitted by law, the reorganization or reconstruction of the Company
or the Guarantor or the consolidation,
amalgamation or merger of the Company or the Guarantor with any other
corporation, or shall prevent the sale, leasing or other transfer by the Company
or the Guarantor of its undertaking and assets as a whole or substantially as a
whole to another corporation lawfully entitled to acquire and operate the same,
provided that the conditions of this Article 9 are observed, and provided also
that every such successor or assign shall before or contemporaneously with the
consummation of any such reorganization, reconstruction, consolidation,
amalgamation, merger or transfer and in consideration thereof, enter into and
execute an indenture or indentures supplemental hereto in favour of the Trustee
whereby such successor or assign covenants:
(a) to pay punctually when due the principal monies, interest and other
monies due or which may become due hereunder;
(b) to perform and observe punctually all the obligations of the Company
and the Guarantor under these presents and under and in respect of
all outstanding Debentures; and
(b) to observe and perform each and every covenant, stipulation,
promise, undertaking, condition and agreement of the Company and the
Guarantor herein contained as fully and completely as if it had
itself executed this Indenture as Party of the First Part or Party
of the Second Part, as the case may be, hereto and had expressly
agreed herein to observe and perform the same.
(2) Every such reorganization, reconstruction, consolidation,
amalgamation, merger, sale, lease or transfer shall be made on such terms and at
such times and otherwise in such manner as shall be approved by the Company or
the Guarantor, as the case may be, and by the Trustee (acting on such advice as
it deems advisable) as being in no way prejudicial to the interests of the
Debentureholders and as preserving and not impairing the rights and powers of
the Trustee and Debentureholders hereunder, and upon such approval the Trustee
shall facilitate the same in all respects, and may give such consents and sign,
execute or join in such Indentures or other documents and do such acts as in its
discretion may be thought advisable in order that such reorganization,
reconstruction, consolidation, amalgamation, merger, sale, lease or transfer may
be carried out, and the opinion of Counsel as hereinafter mentioned shall be
full warrant and authority to the Trustee for so doing. The Trustee may rely
upon an opinion of Counsel to the Trustee as to the legality of any action
proposed to be taken and as to the validity of any action taken pursuant to the
provisions contained in this Article 9, and the Trustee shall incur no liability
by reason of reliance thereon.
9.02 Successor Company/Successor Guarantor to Possess Powers of the
Company/Guarantor
In case of any reorganization, reconstruction, consolidation, amalgamation
or merger as aforesaid, or in case of such transfer of the undertaking of the
assets of the Company or the Guarantor as a whole or substantially as a whole,
the corporation formed by such consolidation or with which the Company or the
Guarantor shall have been amalgamated or merged or to which such transfer shall
have been made, upon executing an Indenture or Indentures, as provided in
Section 9.01, shall succeed to and be substituted for the Company or the
Guarantor, whichever the case may be, (which may then be wound up, if so desired
by its shareholders), with the same effect as if it had been named herein as an
original party hereto, and shall possess and may exercise each and every right
of the Company or the Guarantor hereunder.
ARTICLE 10
INVESTMENT OF TRUST MONIES
10.01 Investment of Trust Monies
Unless herein otherwise expressly provided, any funds held by the Trustee,
including but not restricted to the Escrowed Funds, may be deposited in a trust
account in the name of the Trustee (which may be held with the Trustee or an
affiliate or related party of the Trustee), which account shall be non-interest
bearing. Upon the written direction of the Company, the Trustee shall invest in
its name such funds in Authorized Investments in accordance with such direction.
Any direction by the Company to the Trustee as to the investment of the funds
shall be in writing and shall be provided to the Trustee no later than 9:00 a.m.
on the day on which the investment is to be made. Any such direction received by
the Trustee after 9:00 a.m. or received on a non-business day, shall be deemed
to have been given prior to 9:00 a.m. on the next business day. Unless an event
of default shall have occurred and be continuing, all interest or other income
received by the Trustee in respect of such funds shall belong to the Company;
provided that, if an event of default shall have occurred and be continuing, all
interest or other income derived subsequent to such occurrence shall belong
rateably to the Debentureholders and provided further that the Trustee may
receive a fee from any bank or other institution with which funds are deposited
or through which investments are made.
ARTICLE 11
SUITS BY DEBENTUREHOLDERS AND TRUSTEE
11.01 Debentureholder May Not Xxx
No holder of any Debenture shall have any right to institute any action,
suit or proceeding at law or in equity for the purpose of enforcing payment of
the principal of or any interest on the Debentures or for the execution of any
trust or power hereunder or for the appointment of a liquidator or receiver or
for a receiving order under the Bankruptcy and Insolvency Act (Canada) or to
have the Company and/or the Guarantor wound up or to file or prove a claim in
any liquidation or bankruptcy proceedings or for any other remedy hereunder,
unless the holders of at least twenty-five percent (25%) in principal amount of
the Debentures then outstanding shall have made written request to the Trustee
or the Debentureholders by resolution passed at a meeting duly held as
hereinafter provided in Article 16 of this Indenture have made request to the
Trustee and in either case the Trustee shall have been afforded reasonable
opportunities either itself to proceed to exercise the powers hereinbefore
granted or to institute an action, suit or proceeding in its name for such
purpose; nor unless such Debentureholder or Debentureholders shall also have
furnished to the Trustee, when so requested by the Trustee, sufficient funds and
security and indemnity satisfactory to it against the costs, expenses and
liabilities to be incurred therein or thereby; nor unless the Trustee shall also
have failed to act within a reasonable time after such notification, request and
offer of indemnity; and such request and offer of indemnity are hereby declared
in every such case, at the option of the Trustee, to be conditions precedent to
any such action, suit or proceeding as aforesaid by or on behalf of the holder
or holders of such Debentures or any of them; it being understood and intended
that no one or more holders of Debentures shall have any right in any manner
whatsoever to enforce any right hereunder, except in the manner herein provided,
and that all powers and trusts hereunder shall be exercised and all proceedings
at law or in equity shall be instituted, had and maintained by the Trustee,
except only as herein provided, and only in any event for the equal benefit of
all holders of outstanding Debentures in proportion to the amounts to which they
may respectively be entitled hereunder.
11.02 Trustee May Xxx Without Possession of Debentures
All rights of action under this Indenture may be enforced by the Trustee
without the possession of any of the Debentures or the production thereof at any
trial or other proceedings relative thereto.
11.03 Delay Not Waiver
No delay or omission of the Trustee or of any of the Debentureholders to
exercise any right or power accruing hereunder shall impair any such right or
power, or shall be construed to be a waiver of any default or an acquiescence
therein, and every power and remedy given hereby to the Trustee or to the
Debentureholders may be exercised by it or by them from time to time as often as
may be deemed expedient by it or them.
11.04 Staying Actions
In case any action, suit or other proceeding shall have been brought by
the Trustee or by any Debentureholder or Debentureholders after failure of the
Trustee to act, the Debentureholders may by Extraordinary Resolution direct the
Trustee or the Debentureholder or Debentureholders bringing any such action,
suit or other proceeding to waive the default in respect of which any such
action, suit or other proceeding shall have been brought upon payment of the
costs, charges and expenses incurred by the Trustee or the Debentureholder or
Debentureholders, as the case may be, in connection therewith, and to stay or
discontinue or otherwise deal with any such action, suit or other proceeding and
such directions shall be binding upon the Trustee and such Debentureholder or
Debentureholders and shall be observed by them.
ARTICLE 12
IMMUNITY OF OFFICERS, SHAREHOLDERS AND DIRECTORS
12.01 Immunity of Officers, Shareholders and Directors
The obligations on the part of the Company and the Guarantor contained
herein and in the Debentures are solely corporate obligations, and accordingly
no recourse under or upon any obligation, covenant or agreement contained in
this Indenture or in any Debenture or under any judgment obtained against the
Company or the Guarantor, or by the enforcement of any assessment or by any
legal or equitable proceeding by virtue of any constitution or statute or
otherwise or under any circumstances under or independently of this Indenture,
shall be had against any shareholder, officer or director, past, present or
future, of the Company or the Guarantor (excluding the Company as a Shareholder
of the Guarantor) or of any successor corporation, either directly or through
the Company or the Guarantor or otherwise for payment for or to the Company or
the Guarantor or any receiver, liquidator, trustee or sequestrator thereof or
for or to the holder of any Debenture issued hereunder, or otherwise, of any sum
that may be due and unpaid by the Company hereunder or upon or under any such
Debenture and any and all personal liability of every nature and kind, whether
at common law or in equity or by statute or by constitution or otherwise, of any
such shareholder, officer or director on account of this Indenture or on account
of the Debentures and indebtedness represented thereby, is hereby expressly
waived and released as a condition of and as part of the consideration for the
execution of this Indenture and the issue of the Debentures.
ARTICLE 13
CONCERNING THE TRUSTEE
13.01 Concerning the Trustee
(1) In this Article 13 the term "applicable legislation" means the
provisions, if any, of the Canada Business Corporations Act and any other
statute of Canada, and of regulations under any such statute, relating to trust
indentures and to the right, duties and obligations of trustees under trust
indentures and of corporations issuing debt obligations under trust indentures,
to the extent that such provisions are at the time in force and applicable to
this Indenture. The Trustee shall not be liable except for the performance of
such duties as are specifically set out in this Indenture.
(2) If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with a mandatory requirement of applicable legislation,
such mandatory requirement shall prevail.
(3) The Company, the Guarantor and the Trustee agree that each will at all
times in relation to this Indenture and any action to be taken hereunder,
observe and comply with and be entitled to the benefits of applicable
legislation.
13.02 Rights and Duties of Trustee
(1) In the exercise of the rights, duties and obligations prescribed or
conferred by the terms of this Trust Indenture, the Trustee shall exercise that
degree of care, diligence and skill that a reasonably prudent trustee would
exercise in comparable circumstances.
(2) The Trustee shall not be bound to give any notice or do or take any
act, action or proceeding by virtue of the powers conferred on it hereby unless
and until it shall have been required so to do under the terms hereof, nor shall
the Trustee be required to take notice of any default hereunder, unless and
until notified in writing of such default, which notice shall distinctly specify
the default desired to be brought to the attention of the Trustee and in the
absence of any such notice the Trustee may for all purposes of this Indenture
conclusively assume that no default has been made in the observance or
performance of any of the representations, warranties, covenants, agreements or
conditions contained herein. Any such notice shall in no way limit any
discretion herein given to the Trustee to determine whether or not the Trustee
shall take action with respect to any default.
(3) Subject only to the immediately preceding paragraph, the obligation of
the Trustee to commence or continue any act, action or proceeding for the
purpose of enforcing any rights of the Trustee or the Debentureholders hereunder
shall be conditional upon the Debentureholders furnishing, when required by
notice in writing by the Trustee, sufficient funds to commence or continue such
act, action or proceeding and indemnity reasonably satisfactory to the Trustee
to protect and hold harmless the Trustee against the costs, charges and expenses
and liabilities to be incurred thereby and any loss and damage it may suffer by
reason thereof. None of the provisions contained in this Trust Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers unless indemnified as aforesaid.
(4) The Trustee may, before commencing or at any time during the
continuance of any such act, action or proceeding, require the Debentureholders
at whose instance it is acting to deposit with the Trustee the Debentures held
by them, for which Debentures the Trustee shall issue receipts.
(5) Every provision of this Indenture that by its terms relieves the
Trustee of liability or entitles it to rely upon any evidence submitted to it,
is subject to the provisions of applicable legislation and of this Section 13.02
and of Section 13.03.
13.03 Evidence, Experts and Advisers
(1) In addition to the reports, certificates, opinions and other evidence
required by this Indenture, the Company shall furnish to the Trustee such
additional evidence of compliance with any provision hereof, and in such form,
as may be prescribed by applicable legislation or as the Trustee may reasonably
require by written notice to the Company.
(2) In the exercise of its rights, duties and obligations, the Trustee
may, if it is acting in good faith, rely as to the truth of the statements and
the accuracy of the opinions expressed therein, upon statutory declarations,
opinions, reports, certificates or other evidence referred to in Subsection
13.03(1) provided that such evidence complies with applicable legislation and
that the Trustee examines the same in order to determine whether such evidence
indicates compliance with the applicable requirements of this Trust Indenture.
(3) Whenever applicable legislation requires that evidence referred to in
Subsection 13.03(1) be in the form of a statutory declaration, the Trustee may
accept such statutory declaration in lieu of a certificate of the Company
required by any provision hereof. Any such statutory declaration may be made by
one or more of the Chairman, Chief Operating Officer, Vice-President,
Secretary-Treasurer or a director of the Company.
(4) Proof of the execution of an instrument in writing by any
Debentureholder may be made by the certificate of a notary public or other
officer with similar powers, that the person singing such instrument
acknowledged to him the execution thereof, or by an affidavit of a witness to
such execution or in any other manner which the Trustee may consider adequate.
(5) The Trustee may employ or retain such counsel, accountants, engineers,
appraisers or other experts or advisers as it may reasonably require for the
purpose of discharging its duties and determining its rights hereunder, may pay
the reasonable compensation and disbursements of any such expert or adviser, may
act and rely on the advice or opinion of any such expert or adviser and shall
not be responsible for any misconduct on the part of any of them. Any
remuneration so paid by the Trustee shall be repaid to the Trustee by the
Company in accordance with Section 7.01(g).
13.04 Action by Trustee to Protect Interests
The Trustee shall have power to institute and to maintain such actions and
proceedings as it may consider necessary or expedient to preserve, protect or
enforce its interests and the interests of the Debentureholders.
13.05 Trustee Not Required to Give Security
The Trustee shall not be required to give any bond or security in respect
of the execution of the trusts and powers of this Indenture or otherwise in
respect of the premises.
13.06 Protection of Trustee
By way of supplement to the provisions of any law for the time being
relating to trustees, it is expressly declared and agreed as follows:
(1) The Trustee shall not be liable for or by reason of any statements of
fact or recitals in this Indenture or in the Debentures (except the
representation contained in Subsection 13.09 and the certificate of the
Trustee contained in the Debentures) or be required to verify the same,
but all such statements or recitals are and shall be deemed to be made by
the Company.
(2) Nothing herein contained shall impose any obligation on the Trustee to
see to or to require evidence of the registration or filing (or renewal
thereof) of this Indenture or any instrument ancillary or supplemental
hereto.
(3) The Trustee shall not be bound to give notice to any person or persons
of the execution hereof.
(4) The Trustee shall not incur any liability whatever or be in any way
responsible for the consequence of any breach on the part of the Company
of any of the covenants herein contained or of any acts of the agents or
servants of the Company.
(5) The Trustee, in its personal or any other capacity, may buy, lend upon
and deal in shares in the capital of the Company and in the Debentures and
generally may contract and enter into financial transactions with the
Company or any Affiliate without being liable to account for any profit
made thereby.
13.07 Indemnification of Trustee
In addition to and without limiting any other protection hereunder or
otherwise by law of the Trustee and its officers, directors, employees, agents,
representatives, successors and assigns (collectively, "Representatives"), the
Company and the Guarantor hereby indemnify, defend and save harmless, on a joint
and several basis, the Trustee and its Representatives from and against any and
all liabilities, losses, claims, damages, penalties, fines, actions, suits,
demands, levies, assessments, costs, charges, expenses and disbursements
(including, without limitation, any and all legal and advisor fees and
disbursements) (collectively, "Liabilities") of whatever kind or nature which
may at any time be suffered by, imposed upon, incurred by or asserted against
the Trustee and its Representatives, whether groundless or otherwise, howsoever
arising from or out of any act, omission or error of the Trustee made in
connection with its acting as Trustee hereunder. Without limiting the generality
of the foregoing, the obligation to indemnify, defend and save harmless in
accordance herewith shall apply in respect of Liabilities suffered by, imposed
upon, incurred in any way connected with or arising from, directly or
indirectly, any Environmental Laws. Notwithstanding any other provision hereof,
the obligations provided for in this section shall survive any termination of
the trust created hereby, whether by reason of removal or resignation of the
Trustee, termination or discharge of this Indenture or otherwise.
13.08 Replacement of Trustee
The Trustee may resign its trust and be discharged from all further duties
and liabilities hereunder by giving to the Company not less than thirty (30)
days' prior notice in writing or such shorter notice as the Company may accept
as sufficient. The Debentureholders by Extraordinary Resolution shall have power
at any time to remove the Trustee and to appoint a new Trustee. In the event of
the Trustee resigning or being removed as aforesaid or being dissolved, becoming
bankrupt, going into liquidation or otherwise becoming incapable of acting
hereunder, the Company shall forthwith appoint a new Trustee unless a new
Trustee has already been appointed by the Debentureholders; failing such
appointment by the Company the retiring Trustee, at the expense of the Company,
or any Debentureholder may apply to a judge of the Superior Court of Justice on
such notice as such judge may direct, for the appointment of a new Trustee; but
any new Trustee so appointed by the Company or by the Court shall be subject to
removal as aforesaid by the Debentureholders. Any new Trustee appointed under
any provision of this section shall be a corporation authorized to carry on the
business of a trust company in the province of Ontario and having offices in the
City of Toronto. On any new appointment, the new Trustee shall be vested with
the same powers, rights, duties and responsibilities as if it had been
originally named herein as Trustee without any further assurance, conveyance,
act or deed; but there shall be immediately executed, at the expense of the
Company, all such conveyances or other instruments as may, in the opinion of
counsel, be necessary or advisable for the purpose of assuring the same to the
new Trustee.
Any corporation into or with which the Trustee may be merged or
consolidated or amalgamated, or any corporation succeeding to the trust business
of the Trustee shall be the successor of the Trustee hereunder without any
further act on its part or of any of the parties hereto provided that such
corporation would be eligible for appointment as a new Trustee under this
Section 13.08.
13.09 Conflict of Interest
The Trustee represents that at the time of the execution and delivery
hereof no material conflict of interest exists in the Trustee's role as a
fiduciary hereunder and agrees that in the event of a material conflict of
interest arising hereafter it will, within ninety (90) days after ascertaining
that it has such material conflict of interest, either eliminate the same or
resign its trust hereunder.
13.10 Acceptance of Trust
The Trustee hereby accepts the trusts in this Indenture declared and
provided for and agrees to perform the same upon the terms and conditions herein
set forth.
ARTICLE 14
NON-PRODUCTION OF DEBENTURES
14.01 Non-Production of Debentures
In the event of a holder not producing any Debenture upon the redemption,
maturity or other date of payment thereof, a certificate of the Trustee
hereunder of the deposit with it for payment of the principal amount of such
Debenture and of such interest as may be due thereon shall avail as a
cancellation of such Debenture for the purposes hereof, and as sufficient
authorization to the Company and to the Trustee to cancel all entries in any
register or elsewhere relating to such Debenture.
ARTICLE 15
EVIDENCE OF RIGHTS OF DEBENTUREHOLDERS
15.01 Evidence of Rights of Debentureholders
Any request, direction, notice, consent or other instrument which this
Indenture may require or permit to be signed or executed by the Debentureholders
may be in any number of concurrent instruments of similar tenor and may be
signed or executed by such Debentureholders in person or by attorney dull
appointed in writing. Proof of the execution of any such request or other
instrument, or of a writing appointing any such attorney, or (subject to the
provisions of Article 16 with regard to voting at meetings of Debentureholders)
of the holding by any person of Debentures shall be sufficient for any purpose
of this Indenture if made in the following manner:
(a) the fact and date of the execution by any person of such request or
other instrument in writing may be proved by the certificate of any
notary public, or other officer authorized to take acknowledgements
of deeds to be recorded at the place where such certificate is made,
that the person signing such request or other instrument or writing
acknowledged to him the execution thereof, or by an affidavit of a
witness of such execution, or in any other manner which the Trustee
may consider adequate; and
(b) the ownership of Debentures shall be proved by the registers as
hereinbefore provided.
ARTICLE 16
DEBENTUREHOLDERS' MEETINGS
16.01 Debentureholders' Meetings
Meetings of Debentureholders shall be convened, held and conducted in the
manner following:
(a) Calling of Meetings. At any time and from time to time the Trustee
may, and the Trustee shall on being served with a requisition signed
by the Company or by Debentureholders representing at least ten
percent (10%) of the aggregate principal amount of the Debentures
then outstanding, provided that the Trustee has received funding and
is indemnified to its reasonable satisfaction by the Company or the
Debentureholders requesting a meeting against the costs which may be
incurred in connection with the calling and holding of such meeting,
convene a meeting of the Debentureholders. In the event of the
Trustee failing to convene a meeting after being thereunto required
by the Debentureholders and indemnified and funded as herein set
forth, such Debentureholders representing the requisite percentage
of Debentures as aforesaid may themselves convene such meeting and
the notice calling such meeting may be signed by such person or
persons as such Debentureholders may specify. Every such meeting
shall be held in the City of Toronto, or at such other place as the
Trustee may in any case determine or approve.
(b) Notice. At least twenty-one (21) days' notice of such meeting shall
be given to the Debentureholders and such notice shall state the
time when, and the place where said meeting is to be held and shall
specify in general terms the nature of the business to be transacted
thereat, and shall contain such information as is reasonably
necessary to enable a Debentureholder to make a reasoned decision on
the matter, but it shall not be necessary to specify in the notice
the text of the resolutions to be passed. Notices shall be given in
the manner set forth in Section 2.09 hereof, and a copy thereof
shall be sent by post or delivered to the Trustee and the Company
unless the meeting has been called by it. It shall not be necessary
to specify in the notice of any adjournment of a meeting the nature
of the business to be transacted at the adjourned meeting.
(c) Quorum. At any meeting of the Debentureholders, subject to the
provisions of Section 16.03 hereof, a quorum shall consist of two or
more persons present in person holding either personally or as
proxies for holders not less than twenty-five percent (25%) in
principal amount of all outstanding Debentures. Notwithstanding the
foregoing, if there is only one holder of outstanding Debentures,
that Debentureholder present in person or represented by proxy at
the meeting shall constitute a quorum and a meeting. In the event of
such quorum not being present on the date for which the meeting is
called within one half hour after the time fixed for the holding of
such meeting, the meeting may be adjourned to a date not later than
thirty (30) days from the date for which the meeting was first
called and not less than fourteen (14) days' notice of the date to
which such meeting is adjourned shall be given in the manner
prescribed for notice of meetings of Debentureholders. Such notice
shall state that at the adjourned meeting the Debentureholders
present in person or by proxy shall form a quorum, but it shall not
be necessary to set forth the purposes for which the meeting was
originally called or any other particulars. At the adjourned
meeting, the Debentureholders present in person or by proxy shall
form a quorum and may transact the business for which the meeting
was originally convened.
(d) Chairman. Some person, who need not be a Debentureholder, nominated
in writing by the Trustee shall be chairman of the meeting and, if
no person is so nominated or if the person so nominated is not
present within thirty (30) minutes from the time fixed for the
holding of the meeting, the Debentureholders and proxies for
Debentureholders present shall choose one of their number to be
chairman.
(e) Certain Debentures Deemed Not Outstanding. Debentures owned directly
or indirectly, legally or equitably, by the Company or by any
Affiliate shall not be deemed to be outstanding Debentures for any
purpose of this Article 16; provided, however, that any such
Debentures pledged or charged in good faith (other than to the
Company or an Affiliate) as security for loans or other indebtedness
shall, for all such purposes, be deemed to be outstanding Debentures
and the pledgees thereof or holders of any lien or charge thereon
shall be qualified and entitled to sign any requisition or notice,
attend all meetings of Debentureholders, and vote thereat in respect
of the Debentures so pledged or charged by the Company unless such
pledgees or holders are expressly precluded under the terms of the
pledge or charge from freely exercising in their discretion,
uncontrolled by the Company, or any Affiliate, the right to vote
such Debentures, in which case the terms of the pledge or charge
shall govern.
(f) Majority Vote on Ordinary Resolution. Every question submitted to a
meeting, except an Extraordinary Resolution, shall be decided in the
first place by a majority of the votes given on a show of hands. In
the case of an equality of votes on a show of hands the chairman
shall have a casting vote.
(g) Taking a Poll. A poll shall be taken on every Extraordinary
Resolution and, when requested by a Debentureholder or
Debentureholders or by a proxy or proxies representing a
Debentureholder or Debentureholders holding at least Twenty-Five
Thousand Dollars ($25,000) principal amount of the Debentures, on
any other question or resolution. If at any meeting a poll is so
demanded as aforesaid on the election of a chairman or on a question
of adjournment, it shall be taken forthwith. If at any meeting a
poll is so demanded on any other question, or an extraordinary
resolution is to be voted upon, a poll shall be taken in such manner
and either at once or after an adjournment as
the chairman directs. The results of a poll shall be deemed to be
the decision of the meeting at which the poll was demanded.
(h) Votes on a Poll. At any meeting of the Debentureholders, each
Debentureholder shall on a poll have one vote for every One Hundred
Dollars ($100) principal amount of Debentures of which he shall be
the holder. Votes may be given in person or by proxy and a proxy
need not be a Debentureholder.
(i) Trustee May Make Regulations. The Trustee may (for the purpose of
enabling the holders of Debentures to be present and vote at any
meeting by proxy and of lodging such proxies at some place or places
other than the place where the meeting is to be held) from time to
time make and from time to time vary such regulations as it shall
think fit providing for and governing:
(i) the voting by proxy by holders of Debentures and the form of
instrument appointing proxies where authorized under such
regulations and the manner in which the same shall be
executed, and for the production of the authority of any
person signing on behalf of the giver of such proxy;
(ii) the lodging of such certificates and of the instruments
appointing proxies at such place or places and in such custody
as the Trustee directs and the time, if any, before the
holding of the meeting or adjourned meeting by which the same
shall be deposited; and
(iii) the forwarding by the custodian of particulars of such
certificates and instruments appointing proxies by letter or
telecopy with the original to follow before the meeting to the
Company or to the Trustee or to the chairman of the meeting
and providing that certificates or instruments appointing
proxies so lodged and particulars of which are forwarded in
accordance with such regulations will confer the same right to
vote as though the certificates or instruments themselves were
produced at the meeting.
Any regulations so made shall be binding and effective and votes
given in accordance therewith shall be valid and shall be counted.
The Trustee may dispense with any such deposit and permit
Debentureholders to make proof of ownership in such other manner, if
any, as the Trustee may approve. Save as aforesaid the only persons
who shall be recognized at any meeting as the holders of Debentures
or as entitled to vote or be present at the meeting in respect
thereof shall be registered Debentureholders.
(j) The Company, Trustee and Legal Advisers. The Company and the Trustee
by their respective employees, officers and directors may attend any
meeting of Debentureholders. The legal advisers of the Company, the
Debentureholders and the Trustee may also attend any such meeting.
16.02 Powers Exercisable by Extraordinary Resolution
Unless otherwise provided in this Indenture, a meeting of the
Debentureholders shall, in addition to any powers hereinbefore given, have the
following powers, exercisable from time to time by Extraordinary Resolution:
(a) to sanction any modification, abrogation, alteration, compromise or
arrangement of the rights of the holders of Debentures, the Trustee,
or both, against the Company, the Guarantor, or both, or against
their property, whether such rights arise under this Indenture or
the Debentures or otherwise;
(b) to sanction any scheme for the reconstruction or reorganization of
the Company, the Guarantor, or both, or for the consolidation,
amalgamation or merger of the Company, the Guarantor, or both, with
any other corporation or for the sale, leasing, transfer or other
disposition of the undertaking, property and assets of the Company,
the Guarantor, or both, or any part thereof, provided that no such
sanction will be necessary in respect of any such transaction if
Section 9.01 has been complied with;
(c) to direct or authorize the Trustee, subject to funding and
indemnity, to exercise any power, right, remedy or authority given
to it by this Indenture in any manner specified in any such
Extraordinary Resolution or to refrain from exercising any such
power, right, remedy or authority;
(d) to waive and direct the Trustee to waive any default hereunder or
cancel, or both, any declaration made by the Trustee pursuant to
Section 8.01 either unconditionally or upon any condition specified
in such Extraordinary Resolution;
(e) to direct any holder of Debentures who as such has brought any
action, suit or proceeding, to stay or discontinue or otherwise deal
with the same upon payment, if the taking of such suit, action or
proceeding has been permitted by Section 11.01, of the costs,
charges and expenses reasonably and property incurred by such holder
in connection therewith;
(f) to remove the Trustee from office and to appoint a new Trustee or
Trustees, provided that so long as an event of default has not
occurred and is continuing, such removal or appointment, as the case
may be, has been approved by the Company;
(g) to approve the exchange of the Debentures for or the conversion
thereof into shares, bonds, debentures, notes or other securities of
the Company or of any corporation formed or to be formed, which has
been approved by the Company;
(h) to assent to any compromise or arrangement by the Company, the
Guarantor, or both, with any creditor, creditors or class or classes
of creditors or with the holders of any shares or securities of the
Company, the Guarantor, or both;
(i) to restrain any holder of any Debenture outstanding hereunder from
taking or instituting any suit, action or proceeding for the
execution of any trust or power hereunder or for the appointment of
a liquidator or receiver or trustee in bankruptcy or to have the
Company, the Guarantor, or both, wound up or for any other remedy
hereunder and to direct such holder of any Debenture to waive any
default or defaults by the Company, the Guarantor, or both, on which
any suit or proceeding is founded;
(j) to assent to any modification of or change in or addition to or
omission from the provisions contained in this Indenture which has
been agreed to by the Company and the Guarantor and to authorize the
Trustee to concur in and execute any deed supplemental to this
Indenture embodying any such modification, change, addition or
omission or any deeds, documents or writings authorized by such
extraordinary resolution;
(k) to appoint a committee with power and authority (subject to such
limitations, if any, as may be prescribed in the resolution) to
exercise, and to direct the Trustee to exercise, on behalf of the
Debentureholders, such of the powers of the Debentureholders which
are exercisable by extraordinary or other resolution as shall be
included in the resolution
appointing the committee. The resolution making such appointment may
provide for payment of the expenses and disbursements of and
compensation to such committee. Such committee shall consist of such
number of persons as shall be prescribed in the resolution
appointing it and the members need not be themselves
Debentureholders. Every such committee may elect its chairman and
may make regulations respecting its quorum, the calling of its
meetings, the filling of vacancies occurring in its number and its
procedure generally. Such regulations may provide that the committee
may act at a meeting at which a quorum is present or may act by
minutes signed by the number of members thereof necessary to
constitute a quorum. All acts of any such committee within the
authority delegated to it shall be binding upon all
Debentureholders. Neither the committee nor any member thereof shall
be liable for any loss arising from or in connection with any action
taken or omitted to be taken by them in good faith; and
(l) to amend, alter or repeal any Extraordinary Resolution previously
passed or consented to by Debentureholders before it is acted upon
without further approval by the Debentureholders.
The foregoing powers shall be deemed to be several and not dependent on
each other and each paragraph of this Section 16.02 and each power therein
conferred shall, accordingly, be construed as complete in itself and not by
reference to any other paragraph or power in said section and the exercise of
any one or more of such powers, or any combination of such powers, from time to
time, shall not be deemed to exhaust the rights of the Debentureholders to
exercise such power or powers, or combination of powers, thereafter from time to
time.
16.03 Extraordinary Resolutions
(1) An Extraordinary Resolution, passed at a meeting of the
Debentureholders held in accordance with the provisions hereof, shall be binding
upon all the Debentureholders and upon each and every Debentureholder whether
present or absent and each and every Debentureholder and the Trustee (subject to
the provisions for its indemnity herein contained) shall be bound to give effect
thereto accordingly.
(2) The expression "Extraordinary Resolution" when used in this Indenture
means, subject as hereinafter in this Article 16 provided, a resolution proposed
to be passed as an Extraordinary Resolution at a meeting of Debentureholders
duly convened for the purpose and held in accordance with the provisions of this
Article 16 at which, subject to Subsection 16.05(3), holders of at least
fifty-one (51%) percent in principal amount of the Debentures then outstanding
are present in person or by proxy and passed by the favourable votes of the
holders of not less than sixty-six and two thirds (66-2/3%) percent of the
principal amount of Debentures represented at the meeting and voted on a poll
upon such resolution.
(3) If at any such meeting holders of fifty-one (51%) percent in principal
amount of the Debentures outstanding are not present in person or by proxy
within thirty (30) minutes after the time appointed for the meeting, then the
meeting, if convened by Debentureholders or on a request of Debentureholders
shall be dissolved: but if otherwise convened the meeting shall stand adjourned
to such date, being not less than fifteen (15) nor more than fifty (50) days
later, and to such place and time as may be appointed by the chairman. Not less
than ten (10) days notice shall be given of the time and place of such adjourned
meeting in the manner prescribed for notice of meetings of Debentureholders.
Such notice shall state that at the adjourned meeting the Debentureholders
present in person or by proxy shall form a quorum but it shall not be necessary
to set forth the purposes for which the meeting was originally called or any
other particulars. At the adjourned meeting the Debentureholders present in
person or by proxy shall form a quorum and may transact the business for which
the meeting was originally convened and a resolution proposed at such adjourned
meeting and passed by the requisite vote as provided in Subsection 16.03(2)
shall be an Extraordinary Resolution within the meaning of this Indenture,
notwithstanding that holders of fifty-one (51%) percent in principal amount of
the Debentures then outstanding are not present in person or by proxy at such
adjourned meeting.
(4) Votes on an Extraordinary Resolution shall always be given on a poll
and no demand for a poll on an Extraordinary Resolution shall be necessary.
(5) Save as herein expressly otherwise provided, no action shall be taken
at a meeting of the Debentureholders which changes any provision of this
Indenture or changes or prejudices the exercise of any right of any
Debentureholder except by Extraordinary Resolution as above provided.
16.04 Declaration by Chairman of Result of Vote
At any meeting of the Debentureholders, in cases where no poll is required
or requested, a declaration made by the Chairman that a resolution has been
carried, or carried by any particular majority, or lost, shall be conclusive
evidence thereof.
16.05 Minutes
Minutes of all resolutions and proceedings at every meeting of the
Debentureholders shall be made and duly entered in books to be provided from
time to time for that purpose by the Trustee at the expense of the Company and
any such minutes, if signed by the Chairman of the meeting at which such
resolutions were passed or proceedings had, or by the Chairman of the next
succeeding meeting of Debentureholders, shall be prima facie evidence of the
matters therein stated, and until the contrary is proved, every such meeting in
respect of the proceedings of which minutes shall have been made shall be deemed
to have been duly held and convened and all resolutions passed or proceedings
had thereat to have been duly passed and had.
16.06 Signed Instrument in Lieu of Extraordinary Resolution
Notwithstanding the foregoing provisions of this Indenture, any resolution
or instrument signed in one or more counterparts by the holders of not less than
sixty-six and two thirds per cent (66-2/3%) of the aggregate principal amount of
the Debentures for the time being outstanding shall have the same force and
effect as an Extraordinary Resolution duly adopted by the Debentureholders under
the provisions of this Article 16 with respect to Extraordinary Resolutions.
16.07 Binding Effect of Resolutions
Every resolution and every Extraordinary Resolution passed in accordance
with the provisions of this Article 16 at a meeting of Debentureholders shall be
binding upon all the Debentureholders, whether present at or absent from such
meeting, and every instrument in writing signed by Debentureholders in
accordance with Section 16.06 shall be binding upon the Debentureholders,
whether signatories thereto or not, and each and every Debentureholder and the
Trustee (subject to the provisions for indemnity herein contained) shall be
bound to give effect accordingly to every such resolution and instrument in
writing. In the case of an instrument in writing, the Trustee shall give notice
of the instrument in writing in the manner contemplated in Section 20.01 and
20.03 to the Company and all Debentureholders, respectively, as soon as is
reasonably practicable.
ARTICLE 17
SUPPLEMENTAL INDENTURES
17.01 Supplemental Indentures
(1) From time to time, the Company, the Guarantor and the Trustee may,
when authorized by a resolution of the Directors and, subject to the provisions
of this Indenture, they shall, when so directed by this Indenture, execute,
acknowledge and deliver, by their respective proper officers, deeds or
Indentures supplemental hereto, which thereafter shall form part hereof, for any
one or more of the following purposes:
(a) adding to the limitations or restrictions herein specified further
limitations or restrictions thereafter to be observed; provided that
the Trustee shall be of the opinion that such further limitations or
restrictions shall not be prejudicial to the interests of the
Debentureholders;
(b) adding to the covenants of the Company and the Guarantor herein
contained for the protection of the holders of the Debentures or
providing for events of default in addition to those herein
specified, or both;
(c) making such provisions not inconsistent with this Indenture as may
be necessary or desirable with respect to matters or questions
arising hereunder, including the making of any modifications in the
form of the Debentures which do not affect the substance thereof and
which, in the opinion of the Trustee, it may be expedient to make;
provided that the Trustee (based on the advice of Counsel) shall be
of the opinion that such provisions and modifications will not be
prejudicial to the interests of the Debentureholders;
(d) making any additions to, deletions from or alterations of the
provisions of this Indenture which in the opinion of Counsel may
from time to time be necessary or advisable to conform the same to
"applicable legislation" as that term is defined in Article 13;
(e) evidencing the succession, or successive successions, of other
corporations to the Company and to the covenants of and obligations
assumed by any such successor in accordance with the provisions of
this Indenture;
(f) setting forth any adjustment of the current Conversion Price of the
Debentures in accordance with Section 4.05 and resulting from any
action referred to in Section 4.05;
(g) giving effect to any Extraordinary Resolution or signed instrument
in accordance with Section 16.06; and
(h) for any other purpose not inconsistent with the terms of this
Indenture.
(2) The Trustee may also, without the consent or concurrence of the
Debentureholders, by supplemental indenture or otherwise concur with the Company
in making any changes or corrections in this Indenture as to which it shall have
been advised by Counsel are required for the purpose of curing or correcting any
ambiguity or defective or inconsistent provision or clerical omission or mistake
or manifest error contained herein or in any deed or indenture supplemental or
ancillary hereto.
ARTICLE 18
TERMINATION
18.01 Termination
Except as otherwise expressly stated herein, this Indenture shall
terminate and be void and the Trustee shall, at the request and at the expense
of the Company, execute and deliver to the Company such deeds or other
instruments as shall be necessary to effect the cancellation hereof, if the
Company shall have first satisfied the Trustee that adequate provision has been
made for payment of the fees and expenses of the Trustee hereunder and in
connection with such termination and that it has paid or made due provision
satisfactory to the Trustee for the payment of all amounts due or to become due
on all of the Debentures in the manner therein and herein provided and also all
other monies payable hereunder by the Company or shall surrender or cause to be
surrendered to the Trustee for cancellation all of the Debentures and shall pay
all sums which may be due to the Trustee hereunder, or if the Debentureholders
by Extraordinary Resolution shall so require and shall cause to be paid all said
sums which may be due to the Trustee hereunder. Debentures for the payment or
redemption of which money shall have been set apart by or paid to the Trustee in
conformity with the provisions of this Indenture shall be deemed to be paid
within the meaning of this Article 18. For greater certainty, Section 13.07
shall survive defeasance.
ARTICLE 19
COUNTERPARTS
19.01 Counterparts
This Indenture may be executed in one or more counterparts, each of which
so executed shall be deemed to be an original, and all of such counterparts
together shall constitute one and the same instrument.
ARTICLE 20
NOTICES
20.01 Notices to Company and Guarantor
Any notice to the Company or the Guarantor under this Indenture will be
valid and effective if given by registered letter, postage prepaid, by personal
delivery or by facsimile addressed to the Company to the attention of the Chief
Operating Officer at 00 Xxxxxx Xxxxx, Xxxxxxx Xxxx, Xxx Xxxx 00000-0000
(facsimile number (000) 000-0000) and shall be deemed to have been effectively
given five (5) business days after the date of mailing and on the next business
day if personally delivered or sent by facsimile. The Company and the Guarantor
may from time to time notify the Trustee in writing of a change of address which
thereafter, until changed by like notice, shall be the address of the Company or
the Guarantor (as the case may be) for all purposes of this Indenture. In the
event of a general discontinuance of postal service due to strike, lockout or
otherwise, notices and other communications shall be delivered by hand or sent
by facsimile or other means of electronic communication and shall be deemed to
have been received if sent by facsimile or other means of electronic
communication, on the business day following the sending, or if delivered by
hand at the time it is delivered to the applicable address noted above either to
the individual designated herein or to an individual at such address having
apparent authority to accept deliveries on behalf of the address.
20.02 Notices to Trustee
Any notice to the Trustee under the provisions of this Indenture shall be
valid and effective if given by registered letter, postage prepaid, addressed to
the Trustee at its principal office in the City of Toronto to the attention of
the Senior Trust Officer at Xxxxx 0000, 0 Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxx
X0X 0X0 (facsimile number (000) 000-0000) and shall be deemed to have been
effectively given five (5) business days after the date of mailing and on the
next business day if personally delivered or sent
by fax. In the event of a general discontinuance of postal service due to
strike, lockout or otherwise, notices and other communications shall be
delivered by hand or sent by facsimile or other means of electronic
communication and shall be deemed to have been received if sent by facsimile or
other means of electronic communication, on the business day following the
sending, or if delivered by hand at the time it is delivered to the applicable
address noted below either to the individual designated herein or to an
individual at such address having apparent authority to accept deliveries on
behalf of the address.
20.03 Notice of Debentureholders
Notices to the Debentureholder shall be given in accordance with Section
2.09.
ARTICLE 21
FORMAL DATE
20.01 Formal Date
For the purposes of convenience, this Indenture may be referred to as
bearing formal date of May 28, 1999 irrespective of the actual date of the
execution hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Indenture.
RADIANT ENERGY CORPORATION
Per:_______________________________________
Authorized Signing Officer
RADIANT AVIATION SERVICES, INC.
Per:_______________________________________
Authorized Signing Officer
THE TRUST COMPANY OF BANK OF MONTREAL
Per:_______________________________________
Authorized Signing Officer