YM BIOSCIENCES INC. And CIBC MELLON TRUST COMPANY As Rights Agent SHAREHOLDER RIGHTS PLAN AGREEMENT Dated as of October 22, 2007
Exhibit
99.1
And
CIBC
MELLON TRUST COMPANY
As
Rights Agent
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Dated
as of October 22, 2007
THIS
AGREEMENT dated as of the 22nd day of October,
2007 between YM BioSciences Inc. (the “Corporation”), a corporation continued
under the Companies Act (Nova Scotia), and CIBC Mellon Trust Company, a
trust company incorporated under the laws of Canada, as Rights Agent (the
“Rights Agent”), which term shall include any successor Rights Agent
hereunder.
WHEREAS
the Board of Directors, having determined that it was advisable and in the
best
interests of the Corporation to adopt a shareholder rights plan, adopted such
a
plan, dated as of October 19, 2005 (the “Previous Rights Plan”), which Previous
Rights Plan shall expire at the close of business on the date of the
Corporation’s annual meeting of shareholders in 2007;
AND
WHEREAS the Board of Directors has determined that it is advisable and in the
best interests of the Corporation to maintain a shareholder rights plan and,
therefore, to adopt a new shareholder rights plan (the “Rights Plan”) to take
effect immediately upon expiry of the Previous Rights Plan;
AND
WHEREAS in order to implement the adoption of the Rights Plan the Board of
Directors has (a) authorized the issuance of one Rights effective the Record
Time in respect of each Common Share outstanding at the Record Time; and (b)
authorized the issuance of one Right in respect of each Common Share issued
after the Record Time and prior to the earlier of the Separation Time and the
Expiration Time;
AND
WHEREAS each Right entitles the holder thereof, after the Separation Time,
to
purchase securities of the Corporation (or, in certain cases, of certain other
entities) pursuant to the terms and subject to the conditions set forth
herein;
AND
WHEREAS the Corporation desires to appoint the Rights Agent to act on behalf
of
the Corporation, and the Rights Agent is willing to so act, in connection with
the issuance, transfer, exchange and replacement of Rights Certificates, the
exercise of Rights, and other matters referred to herein;
NOW
THEREFORE in consideration of the foregoing premises and the respective
covenants and agreements set forth herein the parties hereby agree as
follows:
1. INTERPRETATION
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1.1
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Definitions.
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For
purposes of this Agreement, the following terms have the meanings
indicated:
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(a)
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“1933
Securities Act” means the Securities Act of 1933 of the United States, as
amended, and the rules and regulations thereunder, and any comparable
or
successor laws or regulations
thereto.
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(b)
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“1934
Exchange Act” means the Securities Exchange Act of 1934 of the United
States, as amended, and the rules and regulations thereunder, and
any
comparable or successor laws or regulations
thereto.
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(c)
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“Acquiring
Person” means, any Person who is the Beneficial Owner of twenty percent
(20%) or more of the outstanding Voting Shares of the Corporation;
provided, however, that the term “Acquiring Person” shall not
include:
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(i)
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the
Corporation or any Subsidiary of the
Corporation;
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(ii)
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any
Person who becomes the Beneficial Owner of twenty percent (20%) or
more of
the outstanding Voting Shares of the Corporation as a result
of
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(A)
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Corporate
Acquisitions;
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(B)
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Permitted
Bid Acquisitions;
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(C)
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Corporate
Distributions; or
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(D)
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Exempt
Acquisitions
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provided,
however, that if a Person shall become the Beneficial Owner of twenty percent
(20%) or more of the Voting Shares of the Corporation then outstanding by reason
of one or more or any combination of the operation of a Corporate Acquisition,
Permitted Bid Acquisition, Corporate Distribution or Exempt Acquisition, becomes
the Beneficial Owner of an additional one percent (1%) or more of the
outstanding Voting Shares of the Corporation other than pursuant to Corporate
Acquisitions, Permitted Bid Acquisitions, Corporate Distributions or Exempt
Acquisitions, then as of the date of such acquisition, such Person shall become
an “Acquiring Person”;
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(iii)
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for
a period of ten (10) days after the Disqualification Date (as hereinafter
defined), any Person who becomes the Beneficial Owner of twenty percent
(20%) or more of the outstanding Voting Shares of the Corporation
as a
result of such Person becoming disqualified from relying on Clause
1.1
(g)(vii) hereof solely because such Person makes or announces an
intention
to make a Take-over Bid in respect of securities of the Corporation
alone
or by acting jointly or in concert with any other Person (the first
date
of public announcement (which, for the purposes of this definition,
shall
include, without limitation, a report filed pursuant to Section 101
of the
Securities Act (Ontario)) by such Person or the Corporation of the
intent
to commence such a Take-over Bid being herein referred to as the
“Disqualification Date”);
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(iv)
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an
underwriter or member of a banking or selling group which acquires
Voting
Shares of the Corporation from the Corporation in connection with
a bona
fide distribution to the public of securities of the Corporation;
and
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(v)
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a
Person (a “Grandfathered Person”) who is the Beneficial Owner of more than
20% of the outstanding Voting Shares determined as at the Record
Time,
provided, however, that this exception shall not be, and shall cease
to
be, applicable to a Grandfathered Person in the event that such
Grandfathered Person shall, after the Record Time: cease to
Beneficially Own more than 20% of the outstanding Voting Shares;
or
through the acquisition of additional Voting Shares, become the Beneficial
Owner of any additional Voting Shares that increases its Beneficial
Ownership of Voting Shares by more than 1% of the number of Voting
Shares
outstanding as at the Record Time, other than through an acquisition
pursuant to which a Person becomes a Beneficial Owner of additional
Voting
Shares by reason of one or any combination of the operation of Paragraphs
1.1(c)(ii)(A),(B), (C) or (D).
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(d)
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“Affiliate”
when used to indicate a relationship with a specified Person, means
a
Person that directly or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, such
specified Person.
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(e)
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“Agreement”
means this agreement as amended, modified or supplemented from time
to
time.
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(f)
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“Associate”
when used to indicate a relationship with a specified Person, means
any
relative of such specified Person who has the same residence as such
specified Person, a spouse of that Person, any person of the same
or
opposite sex with whom such specified Person is living in a conjugal
relationship outside marriage, or any relative of such spouse or
other
Person who has the same residence as such specified
Person.
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(g)
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A
Person shall be deemed the “Beneficial Owner”, of, and to “Beneficially
Own”:
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(i)
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any
securities as to which such Person or any Affiliate or Associate
of such
Person is or may be deemed to be the owner at law or in
equity;
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(ii)
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any
securities as to which such Person or any Affiliate or Associate
of such
Person has the right to acquire (whether such right is exercisable
immediately or within a period of 75 days thereafter or upon the
occurrence of a contingency or otherwise) pursuant to any agreement,
arrangement, pledge or understanding, whether or not in writing (other
than customary agreements with and between underwriters or banking
group
or selling group members with respect to a public offering of securities
and other than bona fide pledges of securities) or upon the exercise
of
any conversion right, exchange right, share purchase right (other
than a
Right), warrant or option or otherwise;
and
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(iii)
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any
securities which are Beneficially Owned within the meaning of the
foregoing provisions of this Subsection 1.1(g) by any other Person
with
whom such Person is acting jointly or in
concert;
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provided,
however, that a Person shall not be deemed the “Beneficial Owner”, or to have
“Beneficial Ownership” of, or to “Beneficially Own”, any security solely
because:
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(iv)
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such
security has been deposited or tendered pursuant to any Take-over
Bid made
by such Person or made by any Affiliate or Associate of such Person
or
made by any other Person acting jointly or in concert with such Person,
unless such deposited or tendered security has been taken up or paid
for,
whichever shall first occur; or
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(v)
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such
Person or any Affiliate or Associate of such Person or any other
Person
acting jointly or in concert with such Person has or shares the power
to
vote or direct the voting of such security pursuant to a revocable
proxy
given in response to a public proxy solicitation or any such Person
has an
agreement, arrangement or understanding with respect to a particular
shareholder proposal or proposals or a particular matter or matters
to
come before a meeting of shareholders, including the election of
directors; or
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(vi)
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such
Person or any Affiliate or Associate of such Person or any other
Person
acting jointly or in concert with such Person has or shares the power
to
vote or direct the voting of such security in connection with or
in order
to participate in a public proxy solicitation;
or
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(vii)
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(A)
such Person or any Affiliate or Associate of such Person or any other
Person acting jointly or in concert with such Person, holds or exercises
dispositive power over such security; provided that the ordinary
business
of any such Person (the “Fund Manager”) includes the management of
investment funds for others and such dispositive power over such
security
is held by the Fund Manager in the ordinary course of such business
in the
performance of such Fund Manager’s duties for the account of any other
Person (a “Client”), (B) such Person (the “Trust Company”) is licensed to
carry on the business of a trust company under applicable law and,
as
such, acts as trustee or administrator or in a similar capacity in
relation to other accounts and holds or exercises dispositive power
over
such security in the ordinary course of such duties for the estate
of any
such accounts (each an “Other Account”), (C) such Person is established by
statute for purposes that include, and the ordinary business or activity
of such Person includes, the management of investment funds for employee
benefit plans, pension plans, insurance plans or various public bodies;
(D) the ordinary business of any such Person includes acting as an
agent
of the Crown in the management of public assets (the “Crown Agent”), or
(E) the Person, any of such Person’s Affiliates or Associates or any other
Person acting jointly or in concert with such Person holds or exercises
dispositive power over such security, provided that the Person exercising
such dispositive power is the administrator or the trustee of one
or more
pension funds or plans (each a “Pension Fund”) registered under the laws
of Canada or any province thereof or the United States or any state
thereof (the “Independent Person”) and holds such securities solely for
the purposes of its activities as an Independent Person, and further
provided that such Person:
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a)
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does
not hold or exercise dispositive power over more than thirty percent
(30%)
of the Voting Shares of the
Corporation;
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b)
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holds
such Voting Shares of the Corporation for investment purposes;
and
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c)
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is
not acting jointly or in concert with any other
Person;
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provided,
however, that in any of the foregoing cases no one of the Fund Manager, the
Trust Company, the Crown Agent or the Independent Person makes or proposes
to
make a Take-over Bid in respect of securities of the Corporation alone or by
acting jointly or in concert with any other Person (other than by means of
ordinary market transactions (including prearranged trades) executed through
the
facilities of a stock exchange or organized over-the-counter market);
or
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(viii)
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such
security has been agreed to be deposited or tendered pursuant to
a Lock-up
Agreement;
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(ix)
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such
Person is a Client of the same Fund Manager as another Person on
whose
account the Fund Manager holds or exercises dispositive power over
such
security, or such Person is an Estate Account or an Other Account
of the
same Trust Company as another Person on whose account the Trust Company
holds or exercises dispositive power over such security, or such
Person is
a Pension Fund with the same Independent Person as another Pension
Fund;
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(x)
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such
Person is a Client of a Fund Manager and such security is owned at
law or
in equity by the Fund Manager, or such Person is an Estate Account
or
Other Account of a Trust Company and such security is owned at law
or in
equity by the Trust Company, or such Person is a Pension Fund and
such
security is owned at law or in equity by the Independent Person of
the
Pension Fund; or
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(xi)
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such
Person is the registered holder of securities as a result of carrying
on
the business of, or acting as a nominee of a securities
depository.
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For
purposes of this Agreement, the percentage of Voting Shares Beneficially Owned
by any Person, shall be and be deemed to be the product of one hundred (100)
and
the number of which the numerator is the number of votes for the election of
all
directors generally attaching to the Voting Shares Beneficially Owned
by such Person and the denominator of which is the number of votes for the
election of all directors generally attaching to all outstanding Voting
Shares. Where any Person is deemed to Beneficially Own unissued
Voting Shares, such Voting Shares shall be deemed to be issued and outstanding
for the purpose of calculating the percentage of Voting Shares Beneficially
Owned by such Person.
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(h)
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“Board
of Directors” means, at any time, the duly constituted board of directors
of the Corporation.
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(i)
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“Business
Day” means any day other than a Saturday, a Sunday or a day on which
banking institutions in Toronto or New York are authorized or obligated
by
law to close.
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(j)
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“Canadian
Dollar Equivalent” means any amount which is ex pressed in United States
dollars shall mean on any day the Canadian dollar equivalent of such
amount determined by reference to the U.S. Canadian Exchange Rate
on such
date.
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(k)
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“close
of business” on any given date means the time on such date (or, if such
date is not a Business Day, the time on the next succeeding Business
Day)
at which the offices of the transfer agent for the Common Shares
(or,
after the Separation Time, the offices of the Rights Agent) is closed
to
the public in the city in which such transfer agent or Rights Agent
has an
office for the purposes of this
Agreement.
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(l)
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“Common
Shares”, when used with reference to the Corporation, means the common
shares in the capital of the Corporation and, when used with reference
to
any Person other than the Corporation, means the class or classes
of
shares (or similar equity interest) with the greatest per share voting
power entitled to vote generally in the election of all directors
of such
other Person or the equity securities or other equity interest having
power (whether or not exercised) to control or direct the management
of
such other Person or, if such other Person is a Subsidiary of another
Person, the Person or Persons which ultimately control such
first-mentioned Person.
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(m)
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“Companies
Act” means the Companies Act (Nova Scotia), as amended, and the
regulations thereunder, and any comparable or successor laws or
regulations thereto.
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(n)
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“Competing
Permitted Bid” means a Take-over Bid which: (i) is made after a Permitted
Bid has been made and prior to the expiry of the Permitted Bid; (ii)
satisfies all the components of the definition of a Permitted Bid,
except
that the requirements set out in Clause (iii) of the definition
of a Permitted Bid shall be satisfied if the Take-over Bid
shall contain, and take up and payment for securities tendered or
deposited thereunder shall be subject to, an irrevocable and unqualified
condition that no Voting Shares shall be taken up or paid for pursuant
to
the Competing Permitted Bid prior to the close of business on the
date
that is no earlier than the later of: (A) the sixtieth (60th)
day after
the date on which the Permitted Bid which preceded the Competing
Permitted
Bid was made; and (B) thirty-five (35) days after the date of the
Take-over Bid constituting the Competing Permitted Bid; and only
if at
that date, more than fifty percent (50%) of the then outstanding
Voting
Shares held by Independent Shareholders have been deposited to the
Competing Permitted Bid and not
withdrawn.
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(o)
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“controlled”: a
corporation is “controlled” by another Person or two or more Persons
if:
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(i)
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securities
entitled to vote in the election of directors carrying more than
fifty
percent (50%) of the votes for the election of directors are held,
directly or indirectly, by or for the benefit of the other Person
or
Persons; and
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(ii)
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the
votes carried by such securities are entitled, if exercised, to elect
a
majority of the board of directors of such
corporation;
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and
“controls”, “controlling” and “under common control with” shall be interpreted
accordingly.
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(p)
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“Corporate
Acquisition” means an acquisition by the Corporation or a Subsidiary of
the Corporation or the redemption by the Corporation of Voting Shares
of
the Corporation, which by reducing the number of Voting Shares of
the
Corporation outstanding increases the proportionate number of Voting
Shares Beneficially Owned by any
Person.
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(q)
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“Corporate
Distribution” means an acquisition of Voting Shares of the Corporation as
a result of:
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(i)
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a
stock dividend or a stock split or other event pursuant to which
a person
receives or acquires Voting Shares on the same pro rata basis as
all other
holders of the same class of Voting
Shares;
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(ii)
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any
dividend reinvestment plan or other plan made available by the Corporation
to holders of all of its Voting Shares (other than holders resident
in any
jurisdiction where participation in such plan is restricted or impractical
to the Corporation as a result of applicable
law);
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(iii)
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the
receipt and/or exercise of rights issued by the Corporation to purchase
Voting Shares distributed to all the holders of a series or class
of
Voting Shares of the Corporation to subscribe for or purchase Voting
Shares of the Corporation, (other than holders resident in any
jurisdiction where the distribution or exercise of such rights is
restricted or impractical as a result of applicable law), provided
that
such rights are acquired directly from the Corporation and not from
any
other Person; or
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(iv)
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a
distribution or Voting Shares, or securities convertible into,
exchangeable for or carrying the right to acquire Voting Shares (and
the
conversion or exchange of such convertible or exchangeable securities
or
the exercise of the right to acquire Voting Shares carried by such
securities), made pursuant to a
prospectus.
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(r)
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“Disqualification
Date” has the meaning ascribed thereto in Clause
1.1(c)(iii).
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(s)
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“Effective
Date” has the meaning ascribed thereto in Section
5.16.
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(t)
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“Election
to Exercise” has the meaning ascribed thereto in Subsection
2.2(d).
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(u)
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“Exempt
Acquisition” means an acquisition of Voting Shares of the Corporation, in
respect of which the Board of Directors has waived the application
of Section 3.1 hereof pursuant to the provisions of Subsections
5.1(b), (c) or (f) hereof or which was made on or prior to the Record
Time.
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(v)
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“Exercise
Price” means, as of any date from and after the Separation Time, the price
at which a holder may purchase the securities issuable upon exercise
of
one whole Right. Until adjustment thereof in accordance with
the terms hereof, the Exercise Price shall be
$200.00.
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(w)
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“Expansion
Factor” has the meaning ascribed thereto in Subsection
2.3(a)(v).
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(x)
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“Expiration
Time” means the close of business on that date which is the earliest of
the date of termination of this Agreement pursuant to Section 5.16
or, if
this Agreement is confirmed pursuant to Section 5.16, the date of
termination of this Agreement pursuant to Section 5.17 or, if this
Agreement is reconfirmed pursuant to Section 5.17, the close of business
on the date of the Corporation’s annual meeting of shareholders to be held
in 2017.
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(y)
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“Flip-In
Event” means a transaction in or pursuant to which any Person becomes an
Acquiring Person.
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(z)
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“holder”
has the meaning ascribed thereto in Section
2.8.
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(aa)
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“Independent
Shareholders” means holders of Voting Shares of the Corporation, but shall
not include: (i) any Acquiring Person; (ii) any Offeror
(including an Offeror who has announced an intention to make or who
makes
a Permitted Bid or Competing Permitted Bid); (iii) any Affiliate
or
Associate of such Acquiring Person or Offeror; (iv) any Person acting
jointly or in concert with such Acquiring Person or Offeror; or (v)
any
employee benefit plan, stock purchase plan, deferred profit sharing
plan
or any similar plan or trust for the benefit of employees of the
Corporation or a Subsidiary of the Corporation, unless the beneficiaries
of any such plan or trust direct the manner in which the Voting Shares
are
to be voted or director whether the Voting Shares are to be tendered
to a
Take-over Bid.
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(bb)
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“Lock-up
Agreement” means an agreement between an Offeror, any of its Affiliates or
Associates or any other Person acting jointly or in concert with
the
Offeror and a Person (the “Locked-up Person”) who is not an Affiliate or
Associate of the Offeror or a Person acting jointly or in concert
with the
Offeror whereby the Locked-up Person agrees to deposit or tender
the
Voting Shares held by the Locked-up Person to the Offeror’s Take-over Bid
or to any Take-over Bid made by any of the Offeror’s Affiliates or
Associates or made by any other Person acting jointly or in concert
with
the Offeror (the “Lock-up Bid”), provided
that:
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(i)
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the
agreement:
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(A)
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permits
the Locked-up Person to withdraw the Voting Shares from the agreement
in
order to tender or deposit the Voting Shares to another Take-over
Bid or
to support another transaction that contains an offering price for
each
Voting Share that is higher than the offering price contained in
or
proposed to be contained in the Lock-up Bid;
or
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(B)
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(a)
permits the Locked-up Person to withdraw the Voting Shares from the
agreement in order to tender or deposit the Voting Shares to another
Take-over Bid or to support another transaction that contains an
offering
price for each Voting Share that exceeds by as much as or more than
a
specified amount (the “Specified Amount”) the offering price for each
Voting Share contained in or proposed to be contained in the Lock-up
Bid;
and
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(b)
does not by its terms provide for a Specified Amount that is greater than 7%
of
the offering price contained in or proposed to be contained in the Lock-up
Bid;
and,
for greater clarity, an agreement may contain a right of first refusal or
require a period of delay to give an offeror an opportunity to match a higher
price in another take-over bid or other similar limitation on a Locked-up Person
as long as the Locked-up Person is not precluded indefinitely from accepting
another bid or tendering to another transaction; and
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(ii)
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no
“break-up” fees, “top-up” fees, penalties or other amounts that exceed in
the aggregate one-half of the cash equivalent of any amount in excess
of
the amount offered under the Lock-up Bid and the Locked-up Person
receives
pursuant to another Take-over Bid or transaction shall be payable
pursuant
to the agreement in the event that the Locked-up Person fails to
tender
Voting Shares pursuant thereto in order to accept the other Take-over
Bid
or support another transaction.
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(cc)
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“Market
Price” per share of any securities on any date of determination means the
average of the daily closing prices per share of such securities
(determined as described below) on each of the twenty (20) consecutive
Trading Days through and including the Trading Day immediately preceding
such date; provided, however, that if an event of a type analogous
to any
of the events described in Section 2.3 hereof shall have caused the
closing prices used to determine the Market Price on any Trading
Days not
be fully comparable with the closing price on such date of determination
or, if the date of determination is not a Trading Day, on the immediately
preceding Trading Day, each such closing price so used shall be
appropriately adjusted in a manner analogous to the applicable adjustment
provided for in Section 2.3 hereof in order to make if fully comparable
with the closing price on such date of determination or, if the date
of
determination is not a Trading Day,
on
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the
immediately preceding Trading Day. The closing price per share
of any securities on any date shall be (i) the closing board lot
sale
price or, if such price is not available, the average of the closing
bid
and asked prices, for each share as reported by The Toronto Stock
Exchange; or (ii) if for any reason none of such prices is available
on
such day or the securities are not listed or admitted to trading
on The
Toronto Stock Exchange, the closing board lot sale price or, if such
price
is not available, the average of the closing bid and asked prices,
for
each share as reported in the principal consolidated transaction
reporting
system with respect to securities listed or admitted to trading on
the
principal national securities exchange in the United States on which
the
securities are listed or admitted to trading; or (iii) if for any
reason
none of such prices is available on such day or the securities are
not
listed or admitted to trading on The Toronto Stock Exchange or a
national
securities exchange in the United States, the last quoted price,
or if not
so quoted, the average of the high bid and low asked prices for each
share
of such securities in the over-the-counter market, as reported by
The
Canadian Dealing Network Inc. or such other comparable system then
in use;
or (iv) if on any such date the securities are not quoted by any
such
organization, the average of the closing bid and asked prices as
furnished
by a professional market maker making a market in the securities
selected
in good faith by the Board of Directors; provided, however, that
if on any
such date the securities are not traded on any stock exchange or
in the
over-the-counter market, the closing price per share of such securities
on
such date shall mean the fair value per share of such securities
on such
date as determined in good faith by the Board of Directors, after
consultation with a nationally or internationally recognized investment
dealer or investment banker.
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The
Market Price shall be expressed in Canadian dollars and if initially determined
in respect of any day forming part of the twenty (20) consecutive trading day
period in United States dollars, such amount shall be translated into Canadian
dollars at the Canadian Dollar Equivalent thereof. Notwithstanding
the foregoing, where the Board of Directors is satisfied that the Market Price
of securities as determined herein was affected by an anticipated or actual
Take-over Bid or by improper manipulation, the Board of Directors may, acting
in
good faith, determine the Market P rice of securities, such determination to
be
based on a finding as to the price of which a holder of securities of that
class
could reasonably have expected to dispose of his securities immediately prior
to
the relevant date excluding any change in price reasonably attributable to
the
anticipated or actual Take-over Bid or to the improper
manipulation.
|
|
(dd)
|
“Offer
to Acquire” shall include:
|
|
|
(i)
|
an
offer to purchase, a public announcement of an intention to make
an offer
to purchase, or a solicitation of an offer to sell, Voting Shares
of the
Corporation; and
|
|
|
(ii)
|
an
acceptance of an offer to sell Voting Shares of the Corporation,
whether
or not such offer to sell has been solicited; or any combination
thereof,
and the Person accepting an offer to sell shall be deemed to be making
an
Offer to Acquire to Acquire to the Person that made the offer to
sell.
|
11
|
|
(ee)
|
“Offeror”
means a Person who has announced an intention to make, or who is
making, a
Take-over Bid.
|
|
|
(ff)
|
“Offeror’s
Securities” means Voting Shares of the Corporation Beneficially Owned by
an Offeror, any Affiliate or Associate of such Offeror, any Person
acting
jointly or in concert with the Offeror or with any Affiliate of the
Offeror and any Affiliates or Associates of such Person so acting
jointly
or in concert.
|
|
|
(gg)
|
“Permitted
Bid” means a Take-over Bid made by an Offeror which is made by means of
a
Take-over Bid circular and which also complies with the following
additional provisions:
|
|
|
(i)
|
the
Take-over Bid shall be made to all holders or record of Voting Shares
wherever resident as registered on the books of the Corporation,
other
than the Offeror;
|
|
|
(ii)
|
the
Take-over Bid shall contain, and the take up and payment for securities
tendered or deposited thereunder shall be subject to, an irrevocable
and
unqualified condition that no Voting Shares shall be taken up or
paid for
pursuant to the Take-over Bid prior to the close of business on the
date
which is not less than sixty (60) days following the date of the
Take-over
Bid, and only if at such date, more than fifty percent (50%) of the
then
outstanding Voting Shares held by Independent Shareholders shall
have been
deposited to the Take-over Bid and not
withdrawn;
|
|
|
(iii)
|
the
Take-over Bid shall contain an irrevocable and unqualified provision
that,
unless the Take-over Bid is withdrawn in accordance with applicable
law,
Voting Shares of the Corporation may be deposited pursuant to such
Take-over Bid at any time during the period of time described in
Clause
(ii) of this Subsection 1.1(gg) and that any Voting Shares deposited
pursuant to the Take-over Bid may be withdrawn at any time until
taken up
and paid for; and
|
|
|
(iv)
|
the
Take-over Bid shall contain an irrevocable and unqualified provision
that
if, on the date on which Voting Shares may be taken up and paid for,
more
than fifty percent (50%) of the then outstanding Voting Shares held
by
Independent Shareholders have been deposited to the Take-over Bid
and not
withdrawn, (A) the Offeror will make a public announcement of that
fact on
the date the Take-over Bid would otherwise expire; and (B) the Take-over
Bid will be extended for a period of not less than ten (10) Business
Days
from the date it would otherwise
expire.
|
|
|
(hh)
|
“Permitted
Bid Acquisitions” means share acquisitions made pursuant to a Permitted
Bid or a Competing Permitted Bid.
|
12
|
|
(ii)
|
“Person”
means any individual, firm, partnership, association, trust, trustee,
executor, administrator, legal or personal representative, government,
governmental body, entity or authority, group, body corporate,
corporation, unincorporated organization or association, syndicate,
joint
venture or any other entity, whether or not having legal personality,
and
any of the foregoing in any derivative, representative or fiduciary
capacity, and pronouns have a similar extended
meaning.
|
|
|
(jj)
|
“Pro
Rata Acquisition” means an acquisition of Voting Shares pursuant to: (i)
the receipt and/or exercise of rights issued by the Corporation to
all
holders of a class of Voting Shares to subscribe for or purchase
Voting
Shares, provided that such rights are acquired directly from the
Corporation as part of a rights offering and not from any other Person;
or
(ii) a distribution by the Corporation of Voting Shares, or securities
convertible into or exchangeable for Voting Shares (and the conversion
or
exchange of such convertible or exchangeable securities) made pursuant
to
a prospectus or a distribution by way of private placement by the
Corporation, provided that the Person does not thereby acquire a
greater
percentage of such Voting Shares, or securities convertible or
exchangeable for Voting Shares of that class, than the Person’s percentage
of Voting Shares Beneficially owned immediately prior to such
acquisition.
|
|
|
(kk)
|
“Record
Time” means the time as of the termination of business at the
Corporation’s annual and special meeting of shareholders to be held on
November 28, 2007 (including any adjournment
thereof).
|
|
|
(ll)
|
“Redemption
Price” has the meaning ascribed thereto in Subsection
5.1(a).
|
|
|
(mm)
|
“regular
periodic cash dividends” means cash dividends paid at regular intervals in
any fiscal year of the Corporation to the extent that such cash dividends
do not exceed, in the aggregate, the greatest
of
|
|
|
(i)
|
two
hundred percent (200%) of the aggregate amount of cash dividends
declared
payable by the Corporation on its Common Shares in its immediately
preceding fiscal year;
|
|
|
(ii)
|
three
hundred percent (300%) of the arithmetic average of the aggregate
amounts
of cash dividends declared payable by the Corporation on its Common
Shares
in its three immediately preceding financial years;
and
|
|
|
(iii)
|
one
hundred percent (100%) of the aggregate consolidated net income of
the
Corporation, before extraordinary items, for its immediately preceding
fiscal year.
|
|
|
(nn)
|
“Right”
means a right issued pursuant to this
Agreement.
|
|
|
(oo)
|
“Rights
Agent” means CIBC Mellon Trust Company, a trust company incorporated under
the laws of Canada or any successor Rights Agent appointed pursuant
to
Subsection 4.1(a).
|
13
|
|
(pp)
|
“Rights
Certificate” has the meaning ascribed thereto in Subsection
2.2(c).
|
|
|
(qq)
|
“Rights
Holders’ Special Meeting” means a meeting of the holders of Rights called
by the Board of Directors for the purpose of approving a supplement
or
amendment to this Agreement pursuant to Subsection
5.4(c).
|
|
|
(rr)
|
“Rights
Register” has the meaning ascribed thereto in Subsection
2.6(a).
|
|
|
(ss)
|
“Securities
Act (Ontario)” means the Securities Act, R.S.O. 1990, c. S.5. as amended,
and the regulations, rules, policies, and notices thereunder, and
any
comparable or successor laws, regulations, rules, policies or notices
thereto.
|
|
|
(tt)
|
“Separation
Time” means the close of business on the eighth (8th)
Trading Day
after the earlier of (i) the Stock Acquisition Date, and (ii) the
date of
the commencement of, or first public announcement of the intent of
any
person (other than the Corporation or any Subsidiary of the Corporation)
to commence, a Take-over Bid (other than a Permitted Bid or Competing
Permitted Bid) or such later date as may be determined by the Board
of
Directors provided that, if any Take-over Bid referred to in Clause
(ii)
of this Subsection 1.1(tt) expires, is cancelled, terminated or otherwise
withdrawn prior to the Separation Time, such Take-over Bid shall
be
deemed, for the purposes of this Subsection 1.1(tt), never to have
been
made and provided further that if the Board of Directors determines
pursuant to Subsections 5.1(b), (c) or (f) hereof to waive the application
of Section 3.1 hereof to a Flip-in Event, the Separation Time
in respect of such Flip-in Event shall be deemed never to have
occurred.
|
|
|
(uu)
|
“Stock
Acquisition Date” means the first date of public announcement (which, for
purposes of this definition, shall include, without limitation, a
report
filed pursuant to Section 101 of the Securities Act (Ontario) or
Section
13(d) of the 1934 Exchange Act) by the Corporation or an Offeror
or
Acquiring Person of facts indicating that a Person has become an
Acquiring
Person.
|
|
|
(vv)
|
“Subsidiary”:
a corporation shall be deemed to be a Subsidiary of another corporation
if:
|
|
|
(i)
|
it
is controlled by:
|
|
|
(A)
|
that
other; or
|
|
|
(B)
|
that
other and one or more corporations each of which is controlled by
that
other; or
|
|
|
(C)
|
two
or more corporations each of which is controlled by that other;
or
|
|
|
(ii)
|
it
is a Subsidiary of a corporation that is that other’s
Subsidiary.
|
14
|
|
(ww)
|
“Take-over
Bid” means an Offer to Acquire Voting Shares of the Corporation or
securities convertible into or exchangeable for or carrying a right
to
purchase Voting Shares of the Corporation where the Voting Shares
of the
Corporation subject to the Offer to Acquire, together with the Voting
Shares of the Corporation into which the securities subject to the
Offer
to Acquire are convertible, exchangeable or exercisable, and the
Offeror’s
Securities, constitute in the aggregate twenty percent (20%) or more
of
the outstanding Voting Shares of the Corporation at the date of the
Offer
to Acquire.
|
|
|
(xx)
|
“Termination
Time” means the time at which the right to exercise Rights shall terminate
pursuant to Subsection 5.1(h)
hereof.
|
|
|
(yy)
|
“Trading
Day”, when used with respect to any securities, means a day on which
the
principal Canadian stock exchange or American stock exchange or market
on
which such securities are listed or admitted to trading is open for
the
transaction of business or, if the securities are not listed or admitted
to trading on any Canadian stock exchange or American stock exchange
or
market, a Business Day.
|
|
|
(zz)
|
“U.S.
- Canadian Exchange Rate” means on any date: (i) if on such date the Bank
of Canada sets an average noon spot rate of exchange for the conversion
of
one United States dollar into Canadian dollars, such rate; and (ii)
if any
other case, the rate for such date for the conversion of one United
States
dollar into Canadian dollars which is calculated in the manner which
shall
be determined by the Board of Directors from time to time acting
in good
faith.
|
|
|
(aaa)
|
“Voting
Shares” means, with respect to any Person, the Common Shares of such
Person and any other shares of capital stock or voting interests
of such
Person entitled to vote generally in the election of all
directors.
|
|
1.2
|
Currency. All
sums of money which are referred to in this Agreement are expressed
in
lawful money of Canada, unless otherwise
specified.
|
|
1.3
|
Headings. The
division of this Agreement into Articles, Sections, Subsections,
Clauses
and Subclauses and the insertion of headings, subheadings and a table
of
contents are for convenience of reference only and shall not affect
the
construction or interpretation of this
Agreement.
|
|
1.4
|
Number
and Gender. Wherever the context so requires, terms
used herein importing the singular number only shall include the
plural
and vice-versa and words importing only one gender shall include
all
others.
|
|
1.5
|
Acting
Jointly or in Concert. For the purposes of this
Agreement, a Person shall be deemed to be acting jointly or in concert
with every Person who is a party to an agreement, commitment or
understanding, whether formal or informal, with the first Person
or any
Associate or Affiliate of such Person for the purpose of acquiring
or
making an Offer to Acquire Voting Shares of the
Corporation.
|
15
|
1.6
|
Generally
Accepted Accounting Principles. Wherever in this
Agreement reference is made to generally accepted accounting principles,
such reference shall be deemed to be the recommendations at the relevant
time of the Canadian Institute of Chartered Accountants, or any successor
institute, applicable on a consolidated basis (unless otherwise
specifically provided herein to be applicable on an unconsolidated
basis)
as at the date on which a calculation is made or required to be made
in
accordance with generally accepted accounting principles. Where
the character or amount of any asset or liability or item of revenue
or
expense is required to be determined, or any consolidation or other
accounting computation is required to be made for the purpose of
this
Agreement or any document, such determination or calculation shall,
to the
extent applicable and except as otherwise specified herein or as
otherwise
agreed in writing by the parties, be made in accordance with generally
accepted accounting principles applied on a consistent
basis.
|
|
1.7
|
Statutory
References. Unless the context otherwise requires or
except as expressly provided herein, any reference herein to a specific
part, section, subsection, clause or Rule of any statute or regulation
shall be deemed to refer to the same as it may be amended, re-enacted
or replaced or, if repealed and there shall be no replacement
therefore, to the same as it is in effect on the date of this
Agreement.
|
2. THE
RIGHTS
|
2.1
|
Legend
on Common Share
Certificates.
|
|
|
(a)
|
Certificates
issued for Common Shares after the Record Time but prior to the close
of
business on the earlier of the Separation Time and the Expiration
Time
shall evidence one Right for each Common Share represented thereby
and
shall have impressed on, printed on, written on or otherwise affixed
to
them, a legend in substantially the following
form:
|
UNTIL
THE SEPARATION TIME (AS DEFINED IN THE RIGHTS PLAN REFERRED TO BELOW), THIS
CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS
AS
SET FORTH IN A SHAREHOLDER RIGHTS PLAN AGREEMENT, DATED AS OF OCTOBER 22, 2007
(THE “RIGHTS PLAN”), BETWEEN YM BIOSCIENCES INC. (THE “CORPORATION”) AND CIBC
MELLON TRUST COMPANY, AS RIGHTS AGENT (THE “RIGHTS AGENT”), THE TERMS OF WHICH
ARE HEREBY INCORPORATED HEREIN BY REFERENCE AND A COPY OF WHICH MAY BE INSPECTED
DURING NORMAL BUSINESS HOURS AT THE PRINCIPAL EXECUTIVE OFFICE OF THE
CORPORATION. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS
PLAN, SUCH RIGHTS MAY BE AMENDED OR REDEEMED, MAY EXPIRE, MAY BECOME NULL AND
VOID (IF, IN CERTAIN CASES, THEY ARE ISSUED TO OR “BENEFICIALLY OWNED” BY ANY
PERSON WHO IS, WAS OR BECOMES AN “ACQUIRING PERSON”, AS SUCH TERMS ARE DEFINED
IN THE RIGHTS PLAN, WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR
ANY
SUBSEQUENT HOLDER) OR MAY BE EVIDENCED BY SEPARATE CERTIFICATES AND NOT LONGER
BY THIS CERTIFICATE. THE CORPORATION WILL MAIL OR ARRANGE FOR THE MAILING OF
A
COPY OF THE RIGHTS PLAN TO THE HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON
RECEIPT OF A WRITTEN REQUEST THEREFOR.
16
|
|
(b)
|
Certificates
representing Common Shares that are issued and outstanding at the
Record
Time shall evidence one Right for each Common Share evidenced thereby
notwithstanding the absence of the foregoing legend until the earlier
of
the Separation Time and the Expiration
Time.
|
|
2.2
|
Initial
Exercise Price; Exercise of Rights; Detachment of
Rights.
|
|
|
(a)
|
Right
to entitle holder to purchase one Common Shares prior to
adjustment. Subject to adjustment as herein set forth, each Right
will entitle the holder thereof, from and after the Separation Time
and
prior to the Expiration Time, to purchase, for the Exercise Price
as at
the Business Day immediately preceding the date of exercise of the
Right,
one Common Share of the Corporation (which price and number of Common
Shares are subject to adjustment as set forth
below). Notwithstanding any other provision of this Agreement,
any Rights held by the Corporation and any of its Subsidiaries shall
be
void.
|
|
|
(b)
|
Rights
not exercisable until Separation Time. Until the
Separation Time, (i) the Rights shall not be exercisable and no Right
may
be exercised, and (ii) for administrative purposes, each Right will
be
evidenced by the certificate for the associated Common Share registered
in
the name of the holder thereof (which certificate shall also be deemed
to
be a Rights Certificate) and will be transferable only together with,
and
will be transferred by a transfer of, such associated Common
Share.
|
|
|
(c)
|
Delivery
of Rights Certificate and disclosure statement. From
and after the Separation Time and prior to the Expiration Time: (i)
the
Rights shall be exercisable, and (ii) the registration and transfer
of the
Rights shall be separate from, and independent of, Common
Shares.
|
Promptly
following the Separation Time, the Corporation will prepare and the Rights
Agent
will mail to each holder a record of Rights as of the Separation Time (other
than an Acquiring Person and other than in respect of any Rights Beneficially
Owned by such Acquiring Person which are not held by such Acquiring Person,
the
holder of record of such Rights) at such holder’s address as shown by the
records of the Corporation (the Corporation hereby agreeing to furnish copies
of
such records to the Rights Agent for this purpose), (A) a certificate (a “Rights
Certificate”) in substantially the form of Exhibit A-1 hereto appropriately
completed, representing the number of Rights held by such holder at
the Separation Time and having such marks of identification or designation
and
such legends, summaries or endorsements printed thereon as the Corporation
may
deem appropriate and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law, rule, regulation or
judicial or administrative order or with any rule or regulation made pursuant
thereto or with any rule or regulation of any self-regulatory organization,
stock exchange or quotation system on which the Rights may from time
to time be listed or traded or to confirm to usage, and (B) a disclosure
statement describing the Rights, provided that a nominee shall be sent the
materials provided for in (A) and (B) in respect of all Common Shares held
of
record by it which are not Beneficially Owned by an Acquiring
Person. In order for the Corporation to determine whether any Person
is holding Common Shares which are Beneficially Owned by another Person, the
Corporation may require such first mentioned Person to furnish it with such
information and documentation as the Corporation considers
advisable.
17
|
|
(d)
|
Exercise
of Rights. Rights may be exercised in whole or in part
on any Business Day after the Separation Time and prior to the Expiration
Time by submitting to the Rights Agent the Rights Certificate evidencing
such Rights together with an election to exercise such Rights (an
“Election to Exercise”) substantially in the form attached to the Rights
Certificate duly completed, accompanied by payment by certified cheque,
banker’s draft or money order payable to the order of the Rights Agent (on
behalf of the Corporation), of a sum equal to the Exercisable Price
multiplied by the number of Rights being exercised and a sum sufficient
to
cover any transfer tax or charge which may be payable in respect
of any
transfer involved in the transfer or delivery of Rights Certificates
or
the issuance or deli very of certificates for Common Shares in a
name
other than that of the holder of the Rights being exercised, all
of the
above to be received before the Expiration Time by the Rights Agent
at its
principal office in any of the cities listed on the Rights
Certificate.
|
|
|
(e)
|
Duties
of Rights Agent upon receipt of Election to
Exercise. Upon receipt of a Rights Certificate, which
is accompanied by a completed Election to Exercise that does not
indicate
such Right is null and void as provided by Subsection 3.1(b) hereof,
and
payment as set forth in Subsection 2.2(d) above, the Rights Agent
(unless
otherwise instructed by the Corporation) will thereupon
promptly:
|
|
|
(i)
|
requisition
from the transfer agent for the Common Shares certificates representing
the number of Common Shares to be purchased (the Corporation hereby
irrevocably authorizing its transfer agent to comply with all such
requisitions);
|
|
|
(ii)
|
when
appropriate, requisition from the Corporation the amount of ash to
be paid
in lieu of issuing fractional Common
Shares;
|
|
|
(iii)
|
after
receipt of such certificates, deliver the same to or upon the order
of the
registered holder of such Rights Certificate, registered in such
name or
names as may be designated by such registered
holder;
|
|
|
(iv)
|
when
appropriate, after receipt, deliver such payment (less any amounts
required to be withheld) to or to the order of the registered holder
of
the Rights Certificate; and
|
|
|
(v)
|
tender
to the Corporation all payments received on exercise of the
Rights.
|
18
|
|
(f)
|
Partial
Exercise of Rights. In case the holder of any Rights
shall exercise less than all of the Rights evidenced by such holder’s
Rights Certificate, a new Rights Certificate evidencing the Rights
remaining unexercised will be issued by the Rights Agent to such
holder or
to such holder’s duly authorized
assigns.
|
|
|
(g)
|
Duties
of the Corporation. The Corporation covenants and
agrees that it will:
|
|
|
(i)
|
take
all such action as may be necessary and within its power to ensure
that
all Common Shares or other securities delivered upon exercise of
Rights
shall, at the time of delivery of the certificates for such shares
(subject to payment of the Exercise Price), be duly and validly
authorized, executed, issued and delivered and fully paid and
non-assessable;
|
|
|
(ii)
|
take
all such action as may be necessary and within its power to ensure
compliance with the provisions of Section 3.1 hereof including, without
limitation, all such action to comply with any applicable requirements
of
the Companies Act, the Securities Act (Ontario), the 1933 Securities
Act,
the 1934 Exchange Act and any applicable comparable securities legislation
of any other applicable jurisdiction, in connection with the issuance
and
delivery of the Rights Certificates and the issuance of any Common
Shares
upon exercise of Rights;
|
|
|
(iii)
|
use
reasonable efforts to cause all Common Shares issued upon
exercise of Rights to be listed upon issuance on the principal stock
exchanges on which the Common Shares were traded prior to the Stock
Acquisition Date;
|
|
|
(iv)
|
cause
to be reserved and kept available out of its authorized and unissued
Common Shares, the number of Common Shares that, as provided in this
Agreement, will from time to time be sufficient to permit the exercise
in
full of all outstanding Rights;
|
|
|
(v)
|
pay
when due and payable any and all Canadian and, if applicable, United
States, federal, provincial and state transfer taxes and charges
(but for
greater certainty, not including any income or capital taxes of the
holder
or exercising holder of any liability of the Corporation to withhold
tax)
which may be payable in respect of the original issuance or delivery
of
the Rights Certificates, provided that the Corporation shall not
be
required to pay any transfer tax or charge which may be payable in
respect
of any transfer involved in the transfer or delivery of Rights
Certificates or the issuance or delivery of certificates for shares
or
other securities in a name other than that of the registered holder
of the
Rights being transferred or exercised;
and
|
|
|
(vi)
|
after
the Separation Time, except as permitted by Sections 5.1 or 5.4 hereof,
not take (or permit any Subsidiary to take) any action if at the
time such
action is taken it is reasonably foreseeable that such action will
diminish substantially or otherwise eliminate the benefits intended
to be
afforded by the Rights.
|
19
|
2.3
|
Adjustments
to Exercise Price; Number of Rights. The Exercise
Price, the number and kind of Common Shares or other securities subject
to
purchase upon exercise of each Right and the number of Rights outstanding
are subject to adjustment from time to time as provided in this Section
2.3.
|
|
|
(a)
|
Adjustment
to Exercise Price upon changes to share capital. In
the event the Corporation shall at any time after the Record
Time:
|
|
|
(i)
|
declare
or pay a dividend on the Common Shares payable in Common Shares (or
other
securities exchangeable for or convertible into or giving a right
to
acquire Common Shares or other securities) other than the issue of
Common
Shares or such exchangeable or convertible securities to holders
of Common
Shares in lieu of but not in an amount which exceeds the value of
regular
periodic cash dividends;
|
|
|
(ii)
|
subdivide
or change the then outstanding Common Shares into a greater number
of
Common Shares;
|
|
|
(iii)
|
combine
or change the then outstanding Common Shares into a smaller number
of
Common Shares or;
|
|
|
(iv)
|
issue
any Common Shares (or other securities exchangeable for or convertible
into or giving a right to acquire Common Shares or other securities)
in
respect of, in lieu of or in exchange for existing Common Shares,
except
as otherwise provided in this Section
2.3;
|
the
Exercise Price in effect at the time of the record date for such dividend or
of
the effective date of such subdivision, combination or reclassification, and
the
number and kind of Common Shares or other securities, as the case may be,
issuable on such date, shall be proportionately adjusted so that the holder
of
any Right exercised after such time shall be entitled to receive, upon payment
of the Exercise Price then in effect, the aggregate number and kind of Common
Shares or other securities, as the case may be, which, if such Right had been
exercised immediately prior to such date and at a time when the share transfer
books of the Corporation were open, such holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend, subdivision,
combination or reclassification. If an event occurs which would
require an adjustment under both this Section 2.3 and Section 3.1 hereof, the
adjustment provided for in this Section 3.1 shall be in addition to, and shall
be made prior to, any adjustment required pursuant to Section 3.1
hereof.
If
the Exercise Price and number of Rights outstanding are to be
adjusted:
|
|
(v)
|
the
Exercise Price in effect after such adjustment will be equal to the
Exercise Price in effect immediately prior to such adjustment divided
by
the number of Common Shares (or other capital stock) (the “Expansion
Factor”) that a holder of one Common Share immediately prior to
such dividend, subdivision, change, consolidation or issuance would
hold
thereafter as a result thereof; and
|
20
|
|
(vi)
|
each
Right held prior to such adjustment will become that number of Rights
equal to the Expansion Factor, and the adjusted number of Rights
will be
deemed to be distributed among the Common Shares with respect to
which the
original Rights were associated (if they remain outstanding) and
the
Shares issued in respect of such dividend, subdivision, change,
consolidation or issuance, so that each such Common Share (or other
capital stock) will have exactly one Right associated with
it.
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For
greater certainty, if the securities purchasable upon exercise of Rights are
to
be adjusted, the securities purchasable upon exercise of each Right after such
adjustment will be the securities that a holder of the securities purchasable
upon exercise of one Right immediately prior to such dividend, subdivision,
change, consolidation or issuance would hold thereafter as a result of such
dividend, subdivision, change, consolidation or issuance.
If,
after the Record Time and prior to the Expiration Time, the Corporation shall
issue any shares of capital stock other than Common Shares in a transaction
of a
type described in Clause 2.3(a)(i) or (iv), shares of such capital stock shall
be treated herein as nearly equivalent to Common Shares as may be practicable
and appropriate under the circumstances and the Corporation and the Rights
Agent
agree to amend this Agreement in order to effect such treatment.
In
the event the Corporation shall at any time after the Record Time prior to
the
Separation Time issue any Common Shares otherwise than in a transaction referred
to in this Subsection 2.3(a), each such Common Share so issued shall
automatically have one new Right associated with it, which Right shall be
evidenced by the certificate representing such associated Common
Share.
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(b)
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Adjustment
to Exercise Price upon issue of rights, options and
warrants. In case the Corporation shall at any time
after the Record Time fix a record date for the issuance of rights,
options or warrants to all holders of Common Shares entitling them
(for a
period expiring within forty-five (45) calendar days after such record
date) to subscribe for or purchase Common Shares (or shares having
the
same rights, privileges and preferences as Common Shares (“equivalent
common shares”)) or securities convertible into or exchangeable for or
carrying a right to purchase Common Shares or equivalent common shares
at
a price per Common Share or per equivalent common share (or having
a
conversion price or exchange price or exercise price per share, if
a
security convertible into or exchangeable for or carrying a right
to
purchase Common Shares or equivalent common shares) less than ninety
percent (90%) of the Market Price per Common Share on such record
date,
the Exercise Price to be in effect after such record date shall be
determined by multiplying the Exercise Price in effect immediately
prior
to such record date by a fraction, the numerator
of
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which
shall be the number of Common Shares outstanding on such record date,
plus
the number of Common Shares that the aggregate offering price of
the total
number of Common Shares and/or equivalent common shares so to be
offered
(and/or the aggregate initial conversion, exchange or exercise price
of
the convertible or exchangeable securities or rights so to be offered,
including the price required to be paid to purchase such convertible
or
exchangeable securities or rights so to be offered) would purchase
at such
Market Price per Common Share, and the denominator of which shall
be the
number of Common Shares outstanding on such record date, plus the
number
of additional Common Shares and/or equivalent common shares to be
offered
for subscription or purchase (or into which the convertible or
exchangeable securities are initially convertible, exchangeable or
exercisable). In case such subscription price may be paid by
delivery of consideration, part or all of which may be in a form
other
than cash, the value of such consideration shall be as determined
in good
faith by the Board of Directors, whose determination shall be described
in
a certificate filed with the Rights Agent and shall be binding on
the
Rights Agent and the holders of the Rights. Such adjustment
shall be made successively whenever such a record date is fixed,
and in
the event that such rights or warrants are not so issued, the Exercise
Price shall be adjusted to be the Exercise Price which would then
be in
effect if such record date had not been
fixed.
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For
purposed of this Agreement, the granting of the right to purchase Common Shares
(or equivalent common shares) (whether from treasury shares or otherwise)
pursuant to any dividend or interest reinvestment plan and/or any
Common Share purchase plan providing for the reinvestment of dividends or
interest payable on securities of the Corporation and/or the investment of
periodic optional payments or any employee benefit, stock option or similar
plans (so long as such right to purchase is in no case evidenced by the delivery
of rights or warrants) shall not be deemed to constitute an issue of rights,
options or warrants by the Corporation; provided, however, that, in all such
cases, the right to purchase Common Shares (or equivalent common shares) is
at a
price per share of not less than ninety percent (90%) of the current market
price per share (determined as provided in such plans) of the Common
Shares.
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(c)
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Adjustment
to Exercise Price upon corporate distributions. In
case the Corporation shall at anytime after the Record Time fix a
record
date for a distribution to all holders of Common Shares (including
any
such distribution made in connection with a merger, amalgamation,
arrangement, plan, compromise or reorganization in which the Corporation
is the continuing or successor corporation) of evidences of indebtedness,
cash (other than a regular periodic cash dividend or a regular periodic
cash dividend paid in Common Shares, but including any dividend payable
in
securities other than Common Shares), assets or subscription rights,
options or warrants (excluding those referred to in Subsection 2.3(b)
above), at a price per Common Share that is less than ninety percent
(90%)
of the Market Price per Common Share on the second Trading Day immediately
preceding such record date shall be determined by multiplying the
Exercise
Price in effect immediately prior to such record date by a fraction,
the
numerator of which shall be the Market Price
per
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Common
Share on such record date, less the fair market value (as determined
in
good faith by the Board of Directors, whose determination shall be
described in a statement filed with the Rights Agent and shall be
binding
on the Rights Agent and the holders of the Rights) of the portion
of the
cash, assets or evidences of indebtedness so to be distributed or
of such
subscription rights, options or warrants applicable to a Common Share
and
the denominator of which shall be such Market Price per Common
Share. Such adjustments shall be made successively whenever
such a record date is fixed, and in the event that such distribution
is
not so made, the Exercise Price shall be adjusted to be the Exercise
Price
which would have been in effect if such record date had not been
fixed.
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(d)
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De
minimis threshold for adjustment to Exercise
Price. Notwithstanding anything herein to the
contrary, no adjustment in the Exercise Price shall be required unless
such adjustment would require an increase or decrease of at least
one
percent (1%) in the Exercise Price; provided, however, that any
adjustments which by reason of this Subsection 2.3(d) are not required
to
be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 2.3 shall be
made to the nearest cent or to the nearest one-hundredth of a Common
Share
or other share, as the case may be. Notwithstanding the first
sentence of this Subsection 2.3(d), any adjustment required by this
Section 2.3 shall be made no later than the earlier of: (i)
three (3) years from the date of the transaction which mandates such
adjustment; and (ii) the Expiration
Time.
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(e)
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Corporation
may provide for alternate means of adjustment. Subject
to the prior consent of the holders of Voting Shares or Rights obtained
as
set forth in Subsections 5.4(b) or 5.4(c) hereof, as applicable,
in the
event the Corporation shall at any time after the Record Time issue
any
shares of capital stock (other than Common Shares), or rights or
warrants
to subscribe for or purchase any such capital stock, or securities
convertible into or exchangeable for any such capital stock, in a
transaction referred to in Clauses 2.3(a)(i) or 2.3(a)(iv) or Subsections
2.3(b) or 2.3(c) above, if the Board of Directors acting in good
faith
determines that the adjustments contemplated by Subsections 2.3(a),
(b)
and (c) above in connection with such transaction will no appropriately
protect the interests of the holders of Rights, the Corporation shall
be
entitled to determine what other adjustments to the Exercise Price,
number
of Rights and/or securities purchasable upon exercise of Rights would
be
appropriate and, notwithstanding Subsections 2.3(a), (b) and (c)
above,
such adjustments, rather than the adjustments contemplated by Subsections
2.3(a), (b) and (c) above, shall be made. The Corporation and
the Rights Agent shall amend this Agreement as appropriate to provide
for
such adjustments.
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(f)
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Adjustment
to Rights exercisable into shares other than Common
Shares. If as a result of an adjustment made pursuant
to Section 3.1 hereof, the holder of any Right thereafter exercised
shall
become entitled to receive any shares other than Common Shares, thereafter
the number of such other shares so receivable upon exercise of any
Right
and the Exercise Price thereof shall be subject to adjustment from
time to
time in a manner and on terms as nearly equivalent as practicable
to the
provisions with respect to the Common Shares contained in this Section
2.3, and the provisions of this Agreement with respect to the Common
Shares shall apply on like terms to any such other
shares.
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23
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(g)
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Rights
to evidence right to purchase Common Shares at adjusted Exercise
Price. Each Right originally issued by the Corporation subsequent
to any adjustment made to the Exercise Price hereunder shall evidence
the
right to purchase, at the adjusted Exercise Price, the number of
Common
Shares purchasable from time to time hereunder upon exercise of such
Right, all subject to further adjustment as provided
herein.
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(h)
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Adjustment
to number of Common Shares purchasable upon adjustment to Exercise
Price. Unless the Corporation shall have exercised its
election as provided in Subsection 2.3(i) below, upon each adjustment
of
the Exercise Price as a result of the calculations made in Subsections
2.3(b) and (c) above, each Right outstanding immediately prior to
the
making of such adjustment shall thereafter evidence the right to
purchase,
at the adjusted Exercise Price, that number of Common Shares (calculated
to the nearest one ten-thousandth) obtained by: (i) multiplying
(A) the number of shares purchasable upon exercise of a Right immediately
prior to this adjustment by (B) the Exercise Price in effect immediately
prior to such adjustment of the Exercise Price; and (ii) dividing
the
product so obtained by the Exercise Price in effect immediately after
such
adjustment of the Exercise Price.
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(i)
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Election
to adjust number of Rights upon adjustment to Exercise
Price. The Corporation shall be entitled to elect on
or after the date of any adjustment of the Exercise Price to
adjust the number of Rights, in lieu of any adjustment in the number
of
Common Shares purchasable upon the exercise of a Right. Each of
the Right outstanding after the adjustment in the number of Rights
shall
be exercisable for the number of Common Shares for which a Right was
exercisable for the number of Common Shares for which a Right was
exercisable immediately prior to such adjustment. Each Right
held of record prior to such adjustment of the number of Rights shall
become that number of Rights (calculated to the nearest one ten
thousandth) obtained by dividing the Exercise Price in effect immediately
after adjustment of the Exercise Price. The Corporation shall
make a public announcement of its election to adjust the number of
Rights,
indicating the record date for the adjustment, and, if known at the
time,
the amount of the adjustment to be made. This record date may
be the date on which the Exercise Price is adjusted or any day thereafter,
but, if Rights Certificates have been issued, shall be at least ten
(10)
days later than the date of the public announcement. If Rights
Certificates have been issued, upon each adjustment of the number
of
Rights pursuant to this Subsection 2.3(i), the Corporation shall,
as
promptly as practicable, cause to be distributed to holders of record
of
Rights Certificates on such record date Rights Certificates evidencing,
subject to Section 5.5 hereof, the additional Rights to which such
holders
shall be entitled as a result of such adjustment, or, at the option
of the
Corporation, shall cause to be distributed to such holders of record
in
substitution and replacement for the Rights Certificates held by
such
holders prior to the date of adjustment, and upon surrender thereof,
new
Rights Certificates evidencing all the Rights to which such holders
shall
be entitled after such adjustment.
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24
Rights
Certificates so to be distributed shall be issued, executed and countersigned
in
the manner provided for herein and may bear, at the option of the Corporation,
the adjusted Exercise Price and shall be registered in the names of the holders
of record of Rights Certificates on the record date for the adjustment specified
in the public announcement.
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(j)
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Rights
Certificates may contain Exercise Price before
adjustment. Irrespective of any adjustment or change
in the Exercise Price or the number of Common Shares issuable upon
the
exercise of the Rights, the Rights Certificates theretofore and thereafter
issued may continue to express the Exercise Price per share and the
number
of Common Shares which were expressed in the initial Rights Certificates
issued hereunder.
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(k)
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Corporation
may in certain cases defer issues of securities. In
any case in which this Section 2.3 shall require that an adjustment
in the
Exercise Price be made effective as of a record date for a specified
event, the Corporation may elect to defer until the occurrence of
such
event the issuance to the holder of any Right exercised after such
record
date of the number of Common Shares and other securities of the
Corporation, if any, issuable upon such exercise over and above the
number
of Common Shares and other securities of the Corporation, if any,
issuable
upon such exercise on the basis of the Exercise Price in effect prior
to
such adjustment; provided, however, that the Corporation shall deliver
to
such holder an appropriate instrument evidencing such holder's right
to
receive such additional Common Shares (fractional or otherwise) or
other
securities upon the occurrence of the event requiring such
adjustment.
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(l)
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Corporation
has discretion to reduce Exercise Price for tax
reasons. Notwithstanding anything in this Section 2.3
to the contrary, the Corporation shall be entitled to make such reductions
in the Exercise Price, in addition to those adjustments expressly
required
by this Section 2.3 as and to the extent that in their good faith
judgment, the Board of Directors shall determine to be advisable
in order
that any: (i) consolidation or subdivision of the Common Shares;
(ii)
issuance of any Common Shares at less than the Market Price; (iii)
issuance of securities convertible into or exchangeable for Common
Shares;
(iv) stock dividends; or (v) issuance of rights, options or warrants,
referred to in this Section 2.3 hereafter made by the Corporation
to
holders of its Common Shares, shall not be taxable to such
shareholders.
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(m)
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Adjustment
of Exercise Price. If, as a result of an adjustment made pursuant
to Section 3.1, the holder of any Right thereafter exercised shall
become
entitled to receive any securities other than Common Shares, thereafter
the number of such other securities so receivable upon exercise of
any
Right and the applicable Exercise Price thereof shall be subject
to
adjustment from time to time in a manner and on terms as nearly equivalent
as may be practicable to the provisions with respect to the Common
Shares
contained in the foregoing Subsections of this Section 2.3 and the
provisions of this Agreement with respect to the Common Shares shall
apply
on like terms to any such other
securities.
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25
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2.4
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Date
on Which Exercise is Effective. Each person in
whose name any certificate for Common Shares is issued upon the exercise
of Rights, shall for all purposes be deemed to have become the holder
of
record of the Common Shares represented thereby on, and such certificate
shall be dated, the date upon which the Rights Certificate evidencing
such
Rights was duly surrendered (together with a duly completed Election
to
Exercise) and payment of the Exercise Price for such Rights (and
any
applicable transfer taxes and other governmental charges payable
by the
exercising holder hereunder) was made, provided, however, that if
the date
of such surrender and payment is a date upon which the Common Share
transfer books of the Corporation are closed, such person shall be
deemed
to have become the record holder of such shares on, and such certificate
shall be dated, the next succeeding Business Day on which the Common
Share
transfer books of the Corporation are
open.
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2.5
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Execution,
Authentication, Delivery and Dating of Rights
Certificates.
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(a)
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The
Rights Certificates shall be executed on behalf of the Corporation
by any
of the Chairman, the President, the Chief Financial Officer, or any
Vice
President, together with any other of such Persons or together with
any
one of its Secretary or Treasurer. The signature of any of these
officers
on the Rights Certificates may be manual or facsimile. Rights Certificates
bearing the manual or facsimile signatures of individuals who were
at any
time the proper officers of the Corporation shall bind the Corporation,
notwithstanding that such individuals or any of them have ceased
to hold
such offices prior to the countersignature and delivery of such Rights
Certificates.
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(b)
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Promptly
after the Corporation learns of the Separation Time, the Corporation
will
notify the Rights Agent of such Separation Time and will deliver
Rights
Certificates executed by the Corporation to the Rights Agent for
countersignature together with disclosure statements, and the Rights
Agent
shall manually countersign or by facsimile signature in a manner
satisfactory to the Corporation and send such Rights Certificates
and
statements to the holders of the Rights pursuant to Subsection 2.2(c)
hereof. No Rights Certificates shall be valid for any purpose
until countersigned by the Rights Agent as
aforesaid.
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(c)
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Each
Rights Certificate shall be dated the date of countersignature
thereof.
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2.6
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Registration,
Registration of Transfer and
Exchange.
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(a)
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After
the Separation Time, the Corporation will cause to be kept a register
(the
"Rights Register") in which, subject to such reasonable regulations
as it
may prescribe, the Corporation will provide for the registration
and
transfer of Rights. The Rights Agent is hereby appointed the "Rights
Registrar" for the purpose of maintaining the Rights Register for
the
Corporation and registering Rights
and
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26
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transfers
of Rights as herein provided. In the event that the Rights Agent
shall
cease to be the Rights Registrar, the Rights Agent will have the
right to
examine the Rights Register at all reasonable times. After the Separation
Time and prior to the Expiration Time, upon surrender for registration
of
transfer or exchange of any Rights Certificate and subject to the
provisions of Subsection 2.6(c) below and the other provisions of
this
Agreement, the Corporation will execute and the Rights Agent will
countersign and deliver, in the name of the holder or the designated
transferee or transferees as required pursuant to the holder's
instructions, one or more new Rights Certificates evidencing the
same
aggregate number of Rights as did the Rights Certificates so
surrendered.
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(b)
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All
Rights issued upon any registration of transfer or exchange of Rights
Certificates shall be the valid obligations of the Corporation, and
such
Rights shall be entitled to the same benefits under this Agreement
as the
Rights surrendered upon such registration of transfer or
exchange.
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(c)
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Every
Rights Certificate surrendered for registration of transfer or exchange
shall be duly endorsed, or be accompanied by a written instrument
of
transfer in form satisfactory to the Corporation or the Rights Agent,
as
the case may be, duly executed by the holder thereof or such holder's
attorney duly authorized in writing. As a condition to the issuance
of any
new Rights Certificate under this Section 2.6, the Corporation or
the
Rights Agent may require the payment of a sum sufficient to cover
any tax
or other governmental charge that may be imposed in relation thereto
and
the Corporation may require payment of a sum sufficient to cover
any other
expenses (including the fees and expenses of the Rights Agent) in
connection therewith.
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(d)
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The
Corporation shall not be required to register the transfer or exchange
of
any Rights after the Rights have been terminated pursuant to the
provisions of this Agreement.
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2.7
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Mutilated,
Destroyed, Lost and Stolen Right
Certificates.
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(a)
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If
any mutilated Rights Certificate is surrendered to the Rights Agent
prior
to the Expiration Time, the Corporation shall execute and the Rights
Agent
shall countersign and deliver in exchange therefore a new Rights
Certificate evidencing the same number of Rights as did the Rights
Certificate so surrendered.
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(b)
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If
there shall be delivered to the Corporation and the Rights Agent
prior to
the Expiration Time: (i) evidence to their reasonable satisfaction
of the
destruction, loss or theft of any Rights Certificate; and (ii) such
indemnity or other security as may be required by them to save each
of
them and any of their agents harmless, then, in the absence of notice
to
the Corporation or the Rights Agent that such Rights Certificate
has been
acquired by a bona fide purchaser, the Corporation shall execute
and upon
its request the Rights Agent shall countersign and deliver, in lieu
of any
such destroyed, lost or stolen Rights Certificate, a new Rights
Certificate evidencing the same number of Rights as did the Rights
Certificate so destroyed, lost or
stolen.
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27
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(c)
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As
a condition to the issuance of any new Rights Certificate under this
Section 2.7, the Corporation or the Rights Agent may require the
payment
of a sum sufficient to cover any tax or other governmental charge
that may
be imposed in relation thereto and the Corporation may require payment
of
a sum sufficient to cover any other expenses (including the fees
and
expenses of the Rights Agent) in connection
therewith.
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(d)
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Every
new Rights Certificate issued pursuant to this Section 2.7 in lieu
of any
destroyed, lost or stolen Rights Certificate shall evidence an original
additional contractual obligation of the Corporation, whether or
not the
destroyed lost or stolen Rights Certificate shall be at any time
enforceable by anyone, and the holder thereof shall be entitled to
all the
benefits of this Agreement equally and proportionately with any and
all
other holders of Rights duly issued by the
Corporation.
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2.8
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Persons
Deemed Owners. Prior to due presentment of a Rights Certificate
(or, prior to the Separation Time, the associated Common Share
certificate) for registration of transfer, the Corporation, the Rights
Agent and any agent of the Corporation or the Rights Agent shall
be
entitled to deem and treat the person in whose name a Rights Certificate
(or, prior to the Separation Time, the associated Common Share
certificate) is registered as the absolute owner thereof and of the
Rights
evidenced thereby for all purposes whatsoever. As used in this Agreement,
unless the context otherwise requires, the term "holder" of any Rights
shall mean the registered holder of such Rights (or, prior to the
Separation Time, the associated Common
Shares).
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2.9
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Delivery
and Cancellation of Rights Certificates. All
Rights Certificates surrendered upon exercise or for redemption,
registration of transfer or exchange shall, if surrendered to any
person
other than the Rights Agent, be delivered to the Rights Agent and,
in any
case, shall be promptly cancelled by the Rights Agent. The Corporation
may
at any time deliver to the Rights Agent for cancellation any Rights
Certificates previously countersigned and delivered hereunder which
the
Corporation may have acquired in any manner whatsoever, and all Rights
Certificates so delivered shall be promptly cancelled by the Rights
Agent.
No Rights Certificate shall be countersigned in lieu of or in exchange
for
any Rights Certificates cancelled as provided in this Section 2.9
except
as expressly permitted by this Agreement. The Rights Agent shall
destroy
all cancelled Rights Certificates and deliver a certificate of destruction
to the Corporation.
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2.10
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Agreement
of Rights Holders. Every holder of Rights, by
accepting the same, consents and agrees with the Corporation and
the
Rights Agent and with every other holder of
Rights:
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(i)
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to
be bound by and subject to the provisions of this Agreement, as amended
or
supplemented from time to time in accordance with the terms hereof,
in
respect of all Rights held;
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(ii)
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that
prior to the Separation Time each Right will be transferable only
together
with, and will be transferred by a transfer of, the associated Common
Share certificate representing such
Right;
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28
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(iii)
|
that
after the Separation Time, the Rights Certificates will be transferable
only on the Rights Register as provided
herein;
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(iv)
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that
prior to due presentment of a Rights Certificate (or, prior to the
Separation Time, the associated Common Share certificate) for registration
of transfer, the Corporation, the Rights Agent and any agent of the
Corporation or the Rights Agent shall be entitled to deem and treat
the
person in whose name the Rights Certificate (or prior to the Separation
Time, the associated Common Share certificate) is registered as the
absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on such Rights
Certificate or the associated Common Share certificate made by anyone
other than the Corporation or the Rights Agent) for all purposes
whatsoever, and neither the Corporation nor the Rights Agent shall
be
affected by any notice to the
contrary;
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(v)
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that
such holder of Rights has waived his or her right to receive any
fractional Rights or any fractional Common Shares upon exercise of
Rights
except as provided herein;
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(vi)
|
that,
subject to the provisions of Section 5.4, without the approval of
any
holder of Rights and upon the sole authority of the Board of Directors
acting in good faith this Agreement may be supplemented or amended
from
time to time pursuant to and as provided herein;
and
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(vii)
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that
notwithstanding anything in this Agreement to the contrary, neither
the
Corporation nor the Board of Directors nor the Rights Agent shall
have any
liability to any holder of a Right or to any other Person as a result
of
the inability of the Corporation, the Board of Directors or the Rights
Agent to perform any of its obligations under this Agreement by reason
of
any preliminary or permanent injunction or other order, decree or
ruling
issued by a court of competent jurisdiction or by a government, regulatory
or administrative agency or commission, or any statute, rule, regulation
or executive order promulgated or enacted by any governmental authority,
prohibiting or otherwise restraining performance of such
obligation.
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2.11
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Rights
Certificate Holder not Deemed a Shareholder. No
holder, as such, of any Rights or Rights Certificate shall be entitled
to
vote, receive dividends or be deemed for any purpose whatsoever the
holder
of any Common Share or any other share or security of the Corporation
which may at any time be issuable on the exercise of the Rights
represented thereby, nor shall anything contained herein or in any
Rights
Certificate be construed or deemed to confer upon the holder of any
Right
or Rights Certificate, as such, any of the rights, titles, benefits
or
privileges of a holder of Common Shares or any other shares or securities
of the Corporation or any right to vote at any meeting of shareholders
of
the Corporation whether for the election of directors or otherwise
or upon
any matter submitted to holders of shares of the Corporation at any
meeting thereof, or to give or withhold consent to any action of
the
Corporation, or to receive notice of any meeting or other action
affecting
any holder of Common Shares or any other shares or securities of
the
Corporation except as expressly provided herein, or to receive dividends,
distributions or subscription rights, or otherwise, until the Right
or
Rights evidenced by Rights Certificates shall have been duly exercised
in
accordance with the terms and provisions
hereof.
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29
3. ADJUSTMENTS
TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS
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3.1
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Flip-in
Event.
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(a)
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Subject
to Subsection 3.1(b), and Subsections 5.1(b), 5.1(c) and 5.1(f) hereof,
in
the event that prior to the Expiration Time a Flip-in Event shall
occur,
the Corporation shall take such action as may be necessary to ensure
and
provide within eight (8) Trading Days of such occurrence, or such
longer
period as may be required to satisfy all applicable requirements
of the
Securities Act (Ontario), and the securities legislation of each
other province of Canada and, if applicable, of the United States
of
America that, except as provided below, each Right shall thereafter
constitute the right to purchase from the Corporation upon exercise
thereof in accordance with the terms hereof that number of Common
Shares
of the Corporation having an aggregate Market Price on the date of
the
consummation or occurrence of such Flip-in Event equal to twice the
Exercise Price for an amount equal to the Exercise Price (such Right
to be
appropriately adjusted in a manner analogous to the applicable adjustment
provided for in Section 2.3 hereof in the event that after such date
of
consummation or occurrence an event of a type analogous to any of
the
events described in Section 2.3 hereof shall have occurred with respect
to
such Common Shares).
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|
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(b)
|
Notwithstanding
anything in this Agreement to the contrary, upon the occurrence of
any
Flip-in Event, any Rights that are or were Beneficially Owned on
or after
the earlier of the Separation Time, and the Stock Acquisition Date
by: (i)
an Acquiring Person (or any Affiliate or Associate of an Acquiring
Person
or any Person acting jointly or in concert with an Acquiring Person
or any
Affiliate or Associate of such Acquiring Person); or (ii) a transferee
or
other successor in title directly or indirectly of Rights held by
an
Acquiring Person (or of any Affiliate or Associate of an Acquiring
Person
or of any Person acting jointly or in concert with an Acquiring Person
or
any Associate or Affiliate of an Acquiring Person) who becomes a
transferee or successor in title concurrently with or subsequent
to the
Acquiring Person becoming an Acquiring Person; shall become null
and void
without any further action, and any holder of such Rights (including
transferees or successors in title) shall not have any rights whatsoever
to exercise such Rights under any provision of this Agreement and
shall
not have thereafter any other rights whatsoever with respect to such
Rights, whether under any provision of this Agreement or
otherwise.
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|
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(c)
|
From
and after the Separation Time, the Corporation shall do all such
acts and
things as shall be necessary and within its power to ensure compliance
with the provisions of Section 3.1, including without limitation,
all such
acts and things as may be required to satisfy the requirements of
the
CompaniesAct, the Securities Act (Ontario), the 1933
Securities Act, the 1934 Exchange Act and the securities laws or
comparable legislation in each of the provinces of Canada and each
of the
States of the United States in respect of the issue of Common Shares
upon
the exercise of Rights in accordance with this
Agreement.
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30
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|
(d)
|
Any
Rights Certificate that would represent Rights Beneficially owned
by a
Person described in either Clause 3.1(b)(i) or (ii) or transferred
to any
nominee of any such Person, and any Rights Certificate that would
be
issued upon transfer, exchange, replacement or adjustment of any
other
Rights Certificate referred to in this sentence, shall either not
be
issued upon the instruction of the Corporation in writing to the
Rights
Agent or contain the following
legend:
|
“THE
RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE WERE ISSUED TO A PERSON WHO WAS
AN
ACQUIRING PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON (AS
SUCH
TERMS ARE DEFINED IN THE SHAREHOLDER RIGHTS PLAN AGREEMENT) OR A PERSON WHO
WAS
ACTING JOINTLY OR IN CONCERT WITH AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE OF AN ACQUIRING PERSON. THIS RIGHTS CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY ARE VOID OR SHALL BECOME VOID IN THE CIRCUMSTANCES
SPECIFIED IN SUBSECTION 3.1(b) OF THE SHAREHOLDER RIGHTS PLAN
AGREEMENT.”
Provided,
however, that the Rights Agent shall not be under any responsibility to
ascertain the existence of facts that would require the imposition of such
legend but shall impose such legend only if instructed to do so by the
Corporation in writing or if a holder fails to certify upon transfer or exchange
in the space provided on the Rights Certificate that such holder is not a Person
described in such legend. The issuance of a Rights Certificate
without the legend referred to in this Subsection 3.1(d) shall be of no effect
on the provisions of Subsection 3.1(b).
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(e)
|
If,
upon the occurrence of a Flip-In Event, the aggregate number of Common
Shares issuable upon the exercise of all Rights then outstanding
would
exceed the aggregate number of Common Shares that the Corporation
is then
authorized to issue pursuant to its constating documents, the number
of
Common Shares acquirable pursuant to each Right shall, notwithstanding
Subsection 3.1(a), be reduced pro rata to the extent necessary
such that the aggregate number of Common Shares issuable upon the
exercise
of all outstanding Rights does not then exceed the aggregate number
of
Common Shares that the Corporation is then authorized to issue pursuant
to
its constating documents, provided that any such pro rata
reduction will not affect the Exercise Price or any other term
of
this Agreement relating to the
Rights.
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31
4. THE
RIGHTS AGENT
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4.1
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General
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|
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(a)
|
The
Corporation hereby appoints the Rights Agent to act as agent for
the
Corporation in accordance with the terms and conditions hereof, and
the
Rights Agent hereby accepts such appointment. The Corporation may
from
time to time appoint such co-Rights Agents as it may deem necessary
or
desirable, subject to the approval of the Rights Agent. In the event
the
Corporation appoints one or more co-Rights Agents, the respective
duties
of the Rights Agents and co-Rights Agents shall be as the Corporation
may
determine with the prior consent of the Rights Agent and the co-Rights
Agents. The Corporation agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from
time to
time, on demand of the Rights Agent, its reasonable expenses and
other
disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties hereunder.
The
Corporation also agrees to indemnify the Rights Agent, its officers,
directors and employees for, and to hold them harmless against, any
loss,
liability, or expense incurred that is not the result of negligence,
bad
faith or wilful misconduct on the part of the Rights Agent, its officers
or employees, for anything done or omitted by the Rights Agent in
connection with the acceptance and administration of this Agreement,
including the costs and expenses of defending against any claim of
liability, which right to indemnification will survive the termination
of
this Agreement and the resignation or removal of the Rights
Agent.
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(b)
|
The
Rights Agent shall be protected from and shall incur no liability
for or
in respect of any action taken, suffered or omitted by it in connection
with its administration of this Agreement in reliance upon any certificate
for Common Shares or any Rights Certificate or certificate for other
securities of the Corporation, instrument of assignment or transfer,
power
of attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it
to be
genuine and to be signed, executed and, where necessary, verified
or
acknowledged, by the proper Person or
Persons.
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(c)
|
The
Corporation shall inform the Rights Agent in a reasonably timely
manner of
events which may materially affect the administration of this Agreement
by
the Rights Agent and, at any time upon request, shall provide to
the
Rights Agent an incumbency certificate certifying the then current
officers of the Corporation.
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4.2
|
Merger
of Amalgamation or Change of Name of Rights
Agent
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(a)
|
Any
corporation into which the Rights Agent or any successor Rights Agent
may
be merged or amalgamated or with which it may be consolidated, or
any
corporation resulting from any merger, amalgamation, statutory arrangement
or consolidation to which the Rights Agent or any successor Rights
Agent
is a party, or any corporation succeeding to the shareholder or
stockholder services business of the Rights Agent or any successor
Rights
Agent, will be the successor to the Rights Agent under this Agreement
without the execution or filing of any paper or any further act on
the
part of any of the parties hereto, provided that such corporation
would be
eligible for appointment as a successor Rights Agent under the provisions
of Section 4.4 hereof. In case at the time such successor Rights
Agent
succeeds to the agency created by
this
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32
|
|
Agreement
any of the Rights Certificates have been countersigned but not delivered,
any such successor Rights Agent may adopt the countersignature of
the
predecessor Rights Agent and deliver such Rights Certificates so
countersigned; and in case at that time any of the Rights Certificates
have not been countersigned, any successor Rights Agent may countersign
such Rights Certificates either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such
cases
such Rights Certificates will have the full force provided in the
Rights
Certificates and in this Agreement.
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(b)
|
In
case at any time the name of the Rights Agent is changed and at such
time
any of the Rights Certificates shall have been countersigned but
not
delivered, the Rights Agent may adopt the countersignature under
its prior
name and deliver Rights Certificates so countersigned; and in case
at that
time any of the Rights Certificates shall not have been countersigned,
the
Rights Agent may countersign such Rights Certificates either in its
prior
name or in its changed name; and in all such cases such Rights
Certificates shall have the full force provided in the Rights Certificates
and in this Agreement.
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|
4.3
|
Duties
of Rights Agent
|
The
Rights Agent undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, to all of which the Corporation and
the
holders of Rights Certificates, by their acceptance thereof, shall be
bound.
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(a)
|
The
Rights Agent may retain and consult with legal counsel (who may be
legal
counsel for the Corporation) and the opinion of such counsel will
be full
and complete authorization and protection to the Rights Agent as
to any
action taken or omitted to be taken by it in good faith and in accordance
with such opinion. The Rights Agent may also consult with such other
experts as the Rights Agent shall consider necessary to properly
carry out
the duties and obligations imposed under this Agreement (at the expense
of
the Corporation) and the Rights Agent shall be entitled to act and
rely in
good faith on the advice of any such
expert.
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(b)
|
Whenever
in the performance of its duties under this Agreement the Rights
Agent
deems it necessary or desirable that any fact or matter be proved
or
established by the Corporation prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect
thereof
be herein specifically prescribed) may be deemed to be conclusively
proven
and established by a certificate signed by a person believed by the
Rights
Agent to be the Chairman, the President, the Chief Financial Officer,
or
any Vice-President, the Treasurer or the Secretary of the Corporation
and
delivered to the Rights Agent; and such certificate will be full
authorization to the Rights Agent for any action taken or suffered
in good
faith by it under the provisions of this Agreement in reliance upon
such
certificate.
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33
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|
(c)
|
The
Rights Agent will be liable hereunder only for events which are the
result
of its own negligence, bad faith or willful misconduct and that of
its
officers, employees and other
representatives.
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(d)
|
The
Rights Agent will not be liable for or by reason of any of the statements
of fact or recitals contained in this Agreement or in the certificates
for
Common Shares or the Rights Certificates (except its countersignature
thereof) or be required to verify the same, but all such statements
and
recitals are and will be deemed to have been made by the Corporation
only.
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(e)
|
The
Rights Agent will not be under any responsibility in respect of the
validity of this Agreement or the execution and delivery hereof (except
the due authorization, execution and delivery hereof by the Rights
Agent)
or in respect of the validity or execution of any Common Share certificate
or Rights Certificate (except its countersignature thereof); nor
will it
be responsible for any breach by the Corporation of any covenant
or
condition contained in this Agreement or in any Rights Certificate;
nor
will it be responsible for any change in the exercisability of the
Rights
(including the Rights becoming void pursuant to Subsection 3.1(b)
hereof)
or any adjustment required under the provisions of Section 2.3 hereof
or
responsible for the manner, method or amount of any such adjustment
or the
ascertaining of the existence of facts that would require any such
adjustment (except with respect to the exercise of Rights after receipt
of
the certificate contemplated by Section 2.3 hereof describing any
such
adjustment); nor will it by any act hereunder be deemed to make any
representation or warranty as to the authorization of any Common
Shares to
be issued pursuant to this Agreement or any Rights or as to whether
any
Common Shares will, when issued, be duly and validly authorized,
executed,
issued and delivered or fully paid and
non-assessable.
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(f)
|
The
Corporation agrees that it will perform, execute, acknowledge and
deliver
or cause to be performed, executed, acknowledged, and delivered all
such
further and other acts, instruments and assurances as may reasonably
be
required by the Rights Agent for the carrying out or performing by
the
Rights Agent of the provisions of this
Agreement.
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(g)
|
The
Rights Agent is hereby authorized and directed to accept written
instructions with respect to the performance of its duties hereunder
from
any person believed by the Rights Agent to be the Chairman, the President,
the Chief Financial Officer, any Vice-President, the Treasurer or
the
Secretary of the Corporation and to apply to such persons for advice
or
instructions in connection with its duties, and it shall not be liable
for
any action taken or suffered by it in good faith in accordance with
instructions of any such person.
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(h)
|
The
Rights Agent and any shareholder or stockholder, director, officer
or
employee of the Rights Agent may buy, sell or deal in Common Shares,
Rights or other securities of the Corporation or become pecuniarily
interested in any transaction in which the Corporation may be interested
or contract with or lend money to the Corporation or otherwise act
as
fully and freely as though it were not Rights Agent under this
Agreement. Nothing herein shall preclude the Rights Agent from
acting in any other capacity for the Corporation or for any other
legal
entity.
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34
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(i)
|
The
Corporation agrees that it shall pay the Rights Agent for the services
provided hereunder in accordance with the tariff of fees as agreed
to in
writing by the Corporation and the Rights Agent and shall reimburse
the
Rights Agent for all costs and expenses, including legal fees incurred
in
the carrying out of duties
hereunder.
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(j)
|
The
Rights Agent may execute and exercise any of the rights or powers
hereby
vested in it or perform any duty hereunder either by itself or by
through
its attorneys or agents, and the Rights Agent will not be answerable
or
accountable for any act, default, neglect or misconduct of any such
attorneys as agents or for any loss to the Corporation resulting
from any
such act, default, neglect or misconduct, provided reasonable care
was
exercised in the selection and continued employment
thereof.
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4.4
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Change
of Rights Agent
|
The
Rights Agent may resign and be discharged from its duties under this Agreement
upon sixty (60) days' notice (or such lesser notice as is acceptable to the
Corporation) in writing mailed to the Corporation and to each transfer agent
of
Voting Shares of the Corporation by registered or certified mail, and to the
holders of the Rights in accordance with Section 5.8 hereof, all of which shall
be at the expense of the Corporation. The Corporation may remove the Rights
Agent upon sixty (60) days' notice in writing, mailed to the Rights Agent and
to
each transfer agent of the Voting Shares of the Corporation by registered or
certified mail and to the holders of the Rights in accordance with Section
5.8
hereof. If the Rights Agent should resign or be removed or otherwise become
incapable of acting, the Corporation will appoint a successor to the Rights
Agent. If the Corporation fails to make such appointment within a period of
sixty (60) days after such removal or after it has been notified in writing
of
such resignation or incapacity by the resigning or incapacitated Rights Agent
or
by the holder of any Rights (which holder shall, with such notice, submit such
holder's Rights Certificate for inspection by the Corporation), then the holder
of any Rights may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent at the Corporation’s expense. Any successor
Rights Agent, whether appointed by the Corporation or by such a court, shall
be
a corporation incorporated under the laws of Canada or a province thereof
authorized to carry on the business of a trust company in the Province of
Ontario. After appointment, the successor Rights Agent will be vested with
the
same powers, rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the predecessor Rights
Agent shall deliver and transfer to the successor Rights Agent any property
at
the time held by it hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose upon receipt of all fees
and
expenses properly owing pursuant to this Agreement. Not later than the effective
date of any such appointment. the Corporation will file notice thereof in
writing with the predecessor Rights Agent and each transfer agent of the Voting
Shares of the Corporation, and mail a notice thereof in writing to the holders
of the Rights. The cost of giving any notice required under this Section 4.4
shall be borne solely by the Corporation. Failure to give any notice provided
for in this Section 4.4 however, or any defect therein, shall not affect the
legality or validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.
35
5.
MISCELLANEOUS
|
5.1
|
Redemption
and Waiver
|
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(a)
|
Subject
to the prior consent of the holders of Voting Shares or the holders
of
Rights obtained as set forth in Subsections 5.4(b) or 5.4(c) hereof,
as
applicable, the Board of Directors acting in good faith may, at any
time
prior to the occurrence of a Flip-in Event as to which the application
of
Section 3.1 has not been waived pursuant to this Section 5.1, elect
to
redeem all but not less than all of the then outstanding Rights at
a
redemption price of $0.0001 per Right appropriately adjusted in a
manner
analogous to the applicable adjustment provided for in Section 2.3
hereof
in the event that an event of the type described in Section 2.3 hereof
shall have occurred (such redemption price being herein referred
to as the
“Redemption Price”).
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|
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(b)
|
Subject
to the prior consent of the holders of Voting Shares obtained as
set forth
in Subsection 5.4(b) hereof, the Board of Directors acting in good
faith
may, prior to the occurrence of a Flip-in Event as to which the
application of Section 3.1 has not been waived pursuant to this Section
5.1, and upon prior written notice to the Rights Agent, determine
to waive
the application of Section 3.1 hereof to a Flip-in Event which may
occur
by reason of an acquisition of Voting Shares made otherwise than
pursuant
to a Take-over Bid made by means of a take-over bid circular to all
holders of record of Voting Shares (which for greater certainty shall
not
include the circumstances described in Subsection 5.1(g) below).
In the
event that the Board of Directors proposes such a waiver, the Board
of
Directors shall extend the Separation Time to a date subsequent to
and not
more than ten (10) Business Days following the meeting of shareholders
called to approve such waiver.
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(c)
|
The
Board of Directors acting in good faith may, prior to the occurrence
of a
Flip-in Event as to which the application of Section 3.1 has not
been
waived pursuant to this Section 5.1, and upon prior written notice
delivered to the Rights Agent, determine to waive the application
of
Section 3.1 hereof to a Flip-in Event which may occur by reason of
a
Take-over Bid made by means of a take-over bid circular to all holders
of
Voting Shares (which for greater certainty shall not include the
circumstances described in Subsection 5.1(g) below); provided that
if the
Board of Directors waives the application of Section 3.1 hereof to
a
particular Flip-in Event pursuant to this Subsection 5.1(c), the
Board of
Directors shall be deemed to have waived the application of Section
3.1
hereof to any other Flip-in Event occurring by reason of any Take-over
Bid
made by means of a take-over bid circular to all holders of record
of
Voting Shares prior to the expiry of any Take-over Bid (as the same
may be
extended from time to time) in respect of which a waiver is, or is
deemed
to have been, granted pursuant to this Subsection
5.1(c).
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36
|
|
(d)
|
The
Board of Directors may, prior to the close of business on the tenth
(10th)
Trading Day following a Stock Acquisition Date or such later Business
Day
as they may from time to time determine, upon prior written notice
delivered to the Rights Agent, waive the application of Section 3.1
to the
related Flip-In Event, provided that the Acquiring Person has reduced
its
Beneficial Ownership of Voting Shares (or has entered into a contractual
arrangement with the Corporation, acceptable to the Board of Directors,
to
do so within ten (10) calendar days of the date on which such contractual
arrangement is entered into or such other date as the Board of Directors
may have determined) such that at the time the waiver becomes effective
pursuant to this Subsection 5.1(d) such Person is no longer an Acquiring
Person. In the event of such a waiver becoming effective prior to
the
Separation Time, for the purposes of this Agreement, such Flip-In
Event
shall be deemed not to have
occurred.
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(e)
|
Where
a Take-over Bid that is not a Permitted Bid Acquisition is withdrawn
or
otherwise terminated after the Separation Time has occurred and prior
to
the occurrence of a Flip-In Event, the Board of Directors may elect
to
redeem all the outstanding Rights at the Redemption Price. Upon the
Rights
being redeemed pursuant to this Subsection 5.1(e), all the provisions
of
this Agreement shall continue to apply as if the Separation Time
had not
occurred and Rights Certificates representing the number of Rights
held by
each holder of record of Common Shares as of the Separation Time
had not
been mailed to each such holder and for all purposes of this Agreement
the
Separation Time shall be deemed not to have occurred and the Corporation
shall be deemed to have issued replacement Rights to the holders
of its
then outstanding Common Shares.
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|
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(f)
|
Notwithstanding
the provisions of Subsections 5.1(b) and (c) hereof, the Board of
Directors may, prior to the close of business on the eighth (8th)
day
following the Stock Acquisition Date, determine, upon prior written
notice
delivered to the Rights Agent, to waive or to agree to waive
the application of Section 3.1 hereof to a Flip-in Event, provided
that
both of the following conditions are
satisfied:
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(i)
|
the
Board of Directors has determined that a Person became an Acquiring
Person
by inadvertence and without any intention to become, or knowledge
that
Person would become, an Acquiring Person;
and
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(ii)
|
such
Acquiring Person has reduced its Beneficial Ownership of Voting Shares
(or
has entered into a contractual arrangement with the Corporation,
acceptable to the Board of Directors, to do so within thirty (30)
days of
the date on which such contractual arrangement is entered into) such
that
at the time the waiver becomes effective pursuant to this Subsection
5.1(f), such Person is no longer an Acquiring Person; and in the
event of
such a waiver, for the purposes of this Agreement, the Flip-in Event
shall
be deemed never to have occurred, and the Separation Time shall be
deemed
not to have occurred as a result of such Person having inadvertently
become an Acquiring Person.
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(g)
|
The
Board of Directors shall, without further formality, be deemed to
have
elected to redeem the Rights at the Redemption Price on the date
that a
Person who has made a Permitted Bid, a Competing Permitted Bid or
an
Exempt Acquisition under Subsection 5.1(c) above, takes up and pays
for
Voting Shares pursuant to the terms and conditions of such Permitted
Bid,
Competing Permitted Bid or Exempt Acquisition, as the case may
be.
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37
|
|
(h)
|
If
the Board of Directors elects or is deemed to have elected to redeem
the
Rights and, in circumstances in which Subsection 5.1(a) is applicable,
such redemption is approved by the holders of Voting Shares or the
holders
of Rights in accordance with Subsection 5.4(b) or (c), as the case
may be,
the right to exercise the Rights will thereupon, without further
action
and without notice, terminate and each Right will after redemption
be null
and void and the only right thereafter of the holders of Rights shall
be
to receive the Redemption Price.
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(i)
|
Within
ten (10) days after the Board of Directors electing or having been
deemed
to have elected to redeem the Rights or, if Subsection 5.1(a) applies,
within ten (10) Business Days after the holders of Voting Shares
or the
holders of Rights have approved the redemption of Rights in accordance
with Subsection 5.4(b) or (c) hereof, as the case may be, the Corporation
shall give notice of redemption to the holders of the then outstanding
Rights by mailing such notice to all such holders at their last address
as
they appear upon the Rights Register or, prior to the Separation
Time, on
the registry books of the Transfer Agent for the Common Shares. Any
notice, which is mailed in the manner herein provided, shall be deemed
given, whether or not the holder receives the notice. Each such notice
of
redemption will state the method by which the payment of the Redemption
Price will be made. The Corporation may not redeem, acquire or purchase
for value any Rights at any time in any manner other than that
specifically set forth in this Section 5.1 and other than in connection
with the purchase of Common Shares prior to the Separation
Time.
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(j)
|
Where
a Take-over Bid that is not a Permitted Bid Acquisition is withdrawn
or
otherwise terminated after the Separation Time has occurred and prior
to
the occurrence of a Flip-in Event, the Board of Directors may elect
to
redeem all the outstanding Rights at the Redemption Price. Upon the
Rights
being redeemed pursuant to this Subsection 5.1(j), all the provisions
of
this Agreement shall continue to apply as if the Separation Time
had not
occurred and Rights Certificates representing the number of Rights
held by
each holder of record of Common Shares as of the Separation Time
had not
been mailed to each such holder and for all purposes of this Agreement
the
Separation Time shall be deemed not to have
occurred.
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|
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(k)
|
The
Corporation shall give prompt written notice to the Rights Agent
of any
waiver of the application of Section 3.1 pursuant to this Section
5.1.
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|
5.2
|
Expiration. No
person shall have any rights whatsoever pursuant to or arising out
of this
Agreement or in respect of any Right after the Expiration Time, except
the
Rights Agent as specified in Subsection 4.1(a)
hereof.
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38
|
5.3
|
Issuance
of New Right Certificates. Notwithstanding any of the
provisions of this Agreement or of the Rights to the contrary, the
Corporation may, at its option, issue new Rights Certificates evidencing
Rights in such form as may be approved by its Board of Directors
to
reflect any adjustments or change in the number of kind or class
of shares
purchasable upon exercise of Rights made in accordance with the provisions
of this Agreement.
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|
5.4
|
Supplements
and Amendments.
|
|
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(a)
|
The
Corporation may from time to time supplement or amend this Agreement
without the approval of any holders of Rights or Voting Shares to
correct
any clerical or typographical error or to maintain the validity of
the
Agreement as a result of a change in any applicable legislation or
regulations thereunder. The Corporation, at or prior to the meeting
of the
shareholders, or any adjournment or postponement thereof, to be held
for
shareholders of the Corporation to consider and if deemed advisable,
to
adopt a resolution approving, ratifying and confirming this Agreement
and
the Rights issued pursuant thereto, may supplement or amend this
Agreement
without the approval of any holders of Rights or Voting Shares in
order to
make changes which the Board of Directors acting in good faith may
deem
necessary or desirable.
|
Notwithstanding
anything in this Section 5.4 to the contrary, no supplement or amendment shall
be made to the provisions of Article 4 hereof except with the written
concurrence of the Rights Agent to such supplement or amendment.
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(b)
|
Subject
to Subsection 5.4(a), the Corporation may, with the prior consent
of the
holders of the Voting Shares obtained as set forth below, at any
time
prior to the Separation Time, amend, vary or rescind any of the provisions
of this Agreement and the Rights (whether or not such action would
materially adversely affect the interests of the holders of Rights
generally). Such consent shall be deemed to have been given if provided
by
the holders of Voting Shares at a meeting of the holders of Voting
Shares,
which meeting shall be called and held in compliance with applicable
laws
and regulatory requirements and the requirements in the articles
and
by-laws of the Corporation. Subject to compliance with any requirements
imposed by the foregoing, consent shall be given if the proposed
amendment, variation or revision is approved by the affirmative vote
of a
majority of the votes cast by Independent Shareholders present in
person
or represented by proxy and entitled to be voted at a meeting of
the
holders of Voting Shares.
|
|
|
(c)
|
Subject
to Subsection 5.4(a), the Corporation may, with the prior consent
of the
holders of Rights obtained as set forth below, at any time after
the
Separation Time and before the Expiration Time, amend, vary or rescind
any
of the provisions of this Agreement and the Rights (whether or not
such
action would materially adversely affect the interests of the holders
of
Rights generally), provided that no such amendment, variation or
deletion
shall be made to the provisions of Article 4 except with the written
concurrence of the Rights Agent thereto. Such consent shall be deemed
to
have been given if provided by the holders of Rights at a Rights
Holders’
Special Meeting, which Rights Holders’ Special Meeting shall be called and
held in compliance with applicable laws and regulatory requirements
and,
to the extent
|
39
|
|
possible,
with the requirements in the articles and by-laws of the Corporation
applicable to meetings of holders of Common Shares, applied mutatis
mutandis. Subject to compliance with any requirements imposed by
the
foregoing, consent shall be given if the proposed amendment, variation
or
rescission is approved by the affirmative vote of a majority of the
votes
cast by holders of Rights (other than holders of Rights whose Rights
have
become null and void pursuant to Subsection 3.1(b)), represented
in person
or by proxy at the Rights Holders’ Special
Meeting.
|
|
|
(d)
|
Any
approval of the holders of Rights shall be deemed to have been given
if
the action requiring such approval is authorized by the affirmative
votes
of the holders of Rights present in person or represented by proxy
and
entitled to be voted at a meeting of the holders of Rights and
representing a majority of the votes cast in respect thereof. For
the
purposes hereof, each outstanding Right (other than Rights which
are void
pursuant to the provisions hereof) shall be entitled to one vote,
and the
procedures for the calling, holding and conduct of the meeting shall
be
those, as nearly as may be, which are provided in the Corporation's
by-laws and the Companies Act with respect to a meeting of shareholders
of
the Corporation.
|
|
|
(e)
|
Any
supplements or amendments made by the Corporation to this Agreement
pursuant to Subsection 5.4(a) above which are required to maintain
the
validity of this Agreement as a result of any change in any applicable
legislation or regulations thereunder
shall:
|
|
|
(i)
|
If
made before the Separation Time, be submitted to the shareholders
of the
Corporation at the next meeting of shareholders and the shareholders
may,
by the majority referred to in Subsection 5.4(b), confirm or reject
such
amendment; and
|
|
|
(ii)
|
If
made after the Separation Time, be submitted to the holders of Rights
at a
meeting to be called for on a date not later than immediately following
the next meeting of shareholders of the Corporation and the holders
of
Rights may, by resolution passed by the majority referred to in Subsection
5.4(c), confirm or reject such
amendment.
|
|
|
(f)
|
The
Corporation shall be required to provide the Rights Agent with notice
in
writing of any such amendment, recission or variation to this Agreement
as
referred to in this Section 5.4 within five business days of effecting
such amendment, recission or variation. A supplement or amendment
shall be
effective from the date of the resolution of the Board of Directors
adopting such supplement or amendment until it is confirmed or rejected
or
until it ceases to be effective (as described in the next sentence)
and,
where such supplement or amendment is confirmed, it continues in
effect in
the form so confirmed. If such supplement or amendment is rejected
by the
shareholders or the holders of Rights or is not submitted to the
shareholders or holders of Rights as required, then such supplement
or
amendment shall cease to be effective from and after the termination
of
the meeting at which it was rejected or to which it should have been
but
was not submitted or from and after the date of the meeting of holders
of
Rights that should have been but was not held, and no subsequent
resolution of the Board of Directors to amend, vary or delete any
provision of this Agreement to substantially the same effect shall
be
effective until confirmed by the shareholders or holders of Rights,
as the
case may be.
|
40
|
5.5
|
Fractional
Rights and Fractional
Shares.
|
|
|
(a)
|
The
Corporation shall not be required to issue fractions of Rights or
to
distribute Rights Certificates which evidence fractional
Rights. Any such fractional Right shall be null and void and
the Corporation will not have any obligation or liability in respect
thereof.
|
|
|
(b)
|
The
Corporation shall not be required to issue fractions of Common Shares
or
other securities upon exercise of the Rights or to distribute certificates
which evidence fractional Common Shares or other securities, the
Corporation shall pay to the registered holders of Rights Certificates
at
the time such Rights are exercised as herein provided, an amount
in cash
equal to the same fraction of the Market Price of one Common
Share.
|
|
5.6
|
Rights
of Action. Subject to the terms of this Agreement, all
rights of action in respect of this Agreement, other than rights
of action
vested solely in the Rights Agent, are vested in the respective registered
holders of the Rights; and any registered holder of any Rights, without
the consent of the Rights Agent or of the registered holder of any
other
Rights, may, on such holder's own behalf and for such holder's own
benefit
and the benefit of other holders of Rights enforce, and may institute
and
maintain any suit, action or proceeding against the Corporation to
enforce
such holder's right to exercise such holder's Rights in the manner
provided in such holder's Rights Certificate and in this
Agreement. Without limiting the foregoing or any remedies
available to the holders of Rights, it is specifically acknowledged
that
the holders of Rights would not have an adequate remedy at law for
any
breach of this Agreement and will be entitled to specific performance
of
the obligations under, and injunctive relief against, actual or threatened
violations of the obligations of any Person subject to this
Agreement.
|
|
5.7
|
Regulatory
Approvals. Any obligation of the Corporation or action
or event contemplated by this Agreement (including, without limitation,
any amendments to this Agreement) shall be subject to the receipt
of any
requisite approval or consent from any governmental or regulatory
authority, and without limiting the generality of the foregoing,
necessary
approvals of any stock exchange shall be obtained, such as approvals
relating to the issuance of Common Shares upon the exercise of Rights
under Subsection 2.2(d).
|
|
5.8
|
Declaration
as to Non-Canadian Holders. If, in
the opinion of the Board of Directors (who may rely upon the advice
of
counsel) any action or event contemplated by this Agreement would
require
compliance by the Corporation with the securities laws or comparable
legislation of a jurisdiction outside Canada or the United States,
the
Board of Directors acting in good faith shall take such actions as
it may
deem appropriate to ensure that such compliance is not required,
including, without limitation, establishing procedures for
the
|
41
|
|
issuance
to a Canadian or United States resident trustee of Rights or securities
issuable on exercise of Rights, the holding thereof in trust for
the
Persons entitled thereto (but reserving to the trustee or to the
trustee
and the Corporation, as the Corporation may determine, absolution
investment discretion with respect thereto) and the sale thereof
and
remittance of proceeds of such sale, if any, to the Persons entitled
thereto. In no event shall the Corporation or the Rights Agent be
required
to issue or deliver Rights or securities issuable on exercise of
Rights to
persons who are citizens, residents or nationals of any jurisdiction
other
than Canada or the United States, in which such issue or delivery
would be
unlawful without registration of the relevant Persons or securities
for
such purposes.
|
|
5.9
|
Notice
of Proposed Actions. In case the Corporation shall
propose after the Separation Time and prior to the Expiration Time
to
effect or permit (in cases where the Corporation's permission is
required)
any Flip-in Event or to effect the liquidation, dissolution or winding-up
of the Corporation or the sale of substantially all of the Corporation's
assets, then, in each such case, the Corporation shall give to each
holder
of a Right, in accordance with Section 5.8 hereof, a notice of such
proposed action, which shall specify the date on which such Flip-in
Event,
liquidation, dissolution, winding-up or sale is to take place, and
such
notice shall be so given at least twenty (20) Business Days prior
to the
date of taking of such proposed
action.
|
|
5.10
|
Notices. Notices
or demands authorized or required by this Agreement to be given or
made by
the Rights Agent or by the holder of any Rights to or on the Corporation
shall be sufficiently given or made if delivered or sent by first-class
mail, postage prepaid, addressed (until another address is filed
in
writing with the Rights Agent) or sent by facsimile (in the case
of
facsimile, an original copy of the notice or demand sent by first
class
mail, postage prepaid, to the Corporation following the giving of
the
notice or demand by facsimile), charges prepaid and confirmed in
writing,
as follows:
|
0000
Xxxxxxx Xxxxx,
Xxxxxxxx
00, Xxxxx 000
Xxxxxxxxxxx,
Xxxxxxx
X0X
0X0
Attention: Chairman
and Chief Executive Officer
Facsimile: 905.629.9761
e-mail: xxxxxx@xxxxxxxxxxxxx.xxx
Any
notice or demand authorized or required by this Agreement to be given or made
by
the Corporation or by the holder of any Rights to or on the Rights Agent shall
be sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the
Corporation) or sent by facsimile (in the case of facsimile, an original copy
of
the notice or demand sent by first class mail, postage prepaid, to the Rights
Agent following the giving of the notice or demand by facsimile), or other
form
of recorded electronic communication, charges prepaid and confirmed in writing,
as follows:
42
CIBC
Mellon Trust Company
6th
Floor
000
Xxx Xxxxxx
X.X.
Xxx 0
Xxxxxxx,
Xxxxxxx
X0X
0X0
Attention: Manager,
Client Services
Facsimile: (000)
000-0000
Notices
or demands authorized or required by this Agreement to be given or made by
the
Corporation or the Rights Agent to or on the holder of any Rights shall be
sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, addressed to such holder at the address of such holder as it appears
upon the Rights Register or, prior to the Separation Time, on the registry
books
of the transfer agent for the Common Shares. Any notice, which is mailed in
the
manner herein provided, shall be deemed given, whether or not the holder
receives the notice. Any notice given or made in accordance with this Section
5.10 shall be deemed to have been given and to have been received on the day
of
delivery, if delivered, on the third Business Day (excluding each day during
which there exists any general interruption of postal service due to strike,
lockout or other cause) following the mailing thereof, if mailed, and on the
day
of telegraphing, telecopying or sending of the same by other means of recorded
electronic communication (provided such sending is during the normal business
hours of the addressee on a Business Day and if not, on the first Business
Day
thereafter). Each of the Corporation and the Rights Agent may from time to
time
change its address for notice by notice to the other given in the manner
aforesaid.
|
5.11
|
Cost
of Enforcement. The Corporation agrees that if the
Corporation fails to fulfil any of its obligations pursuant to this
Agreement, then the Corporation will reimburse the holder of any
Rights
for the costs and expenses (including legal fees) incurred by such
holder
to enforce his, her or its rights pursuant to any Rights or this
Agreement.
|
|
5.12
|
Successors. All
the covenants and provisions of this Agreement by or for the benefit
of
the Corporation or the Rights Agent shall bind and enure to the benefit
of
their respective successors and assigns
hereunder.
|
|
5.13
|
Benefits
of this Agreement. Nothing in this Agreement shall be
construed to give to any Person other than the Corporation, the Rights
Agent and the holders of the Rights any legal or equitable right,
remedy
or claim under this Agreement; but this Agreement shall be for the
sole
and exclusive benefit of the Corporation, the Rights Agent and the
holders
of the Rights.
|
|
5.14
|
Governing
Law. This Agreement and each Right issued hereunder
shall be deemed to be a contract made under the laws of the Province
of
Ontario and for all purposes shall be governed by and construed in
accordance with the laws of such province applicable to contracts
to be
made and performed entirely within such
province.
|
43
|
5.15
|
Severability. If
any Section, Subsection, Clause, Subclause, term or provision hereof
or
the application thereof to any circumstances or any right hereunder
shall,
in any jurisdiction and to any extent, be invalid or unenforceable,
such
Section, Subsection, Clause, Subclause, term or provision or such
right
shall be ineffective only in such jurisdiction and to the extent
of such
invalidity or unenforceability in such jurisdiction without invalidating
or rendering unenforceable or ineffective the remaining Sections,
Subsections, Clauses, Subclauses, terms and provisions hereof or
rights
hereunder in such jurisdiction or the application of such Section,
Subsection, Clause, Subclause, term or provision or rights hereunder
in
any other jurisdiction or to circumstances other than those as to
which it
is specifically held invalid or
unenforceable.
|
|
5.16
|
Effective
Date. This Agreement is effective and in full force
and effect in accordance with its terms as of the date hereof (the
"Effective Date"). If the Rights Plan is not confirmed by resolution
passed by a majority of the votes cast by Independent Shareholders
present
or represented by proxy at a meeting of shareholders of the Corporation
to
be held within six months of the Effective Date, then, without further
formality, this Agreement and all outstanding Rights shall terminate
and
be void and be of no further force and effect on and from the earlier
of:
(i) the close of such meeting of shareholders; and (ii) 5:00 p.m.
(Toronto
time) on the date which is six (6) months after the Effective
Date.
|
|
5.17
|
Reconfirmation.
Notwithstanding the confirmation of this Agreement pursuant
to
Section 5.16, this Agreement must be reconfirmed by a resolution
passed by
a majority of the votes cast by all holders of Voting Shares who
vote in
respect of such resolution at every third annual meeting of shareholders
following the meeting at which this Agreement is confirmed pursuant
to
Section 5.16. If this Agreement is not so reconfirmed (or is not
presented
for reconfirmation) at such annual meeting, this Agreement and all
outstanding Rights shall terminate and be void and of no further
force or
effect on and from the date of termination of the annual meeting;
provided, however, that termination shall not occur if a Flip-in
Event has occurred (other than a Flip-in Event which has been
waived pursuant to Section 5.1), prior to the date upon which this
Agreement would otherwise terminate pursuant to this Section
5.17.
|
|
5.18
|
Determinations
and Actions by the Board of Directors. The Board of
Directors shall have the exclusive power and authority to administer
this
Agreement and to exercise all rights and powers specifically granted
to
the Board of Directors or to the Corporation as may be necessary
or
advisable in the administration of this Agreement. All such actions,
calculations and determinations (including all omissions with respect
to
the foregoing) which are done or made by the Board of Directors,
in good
faith, shall not subject the Board of Directors or any director of
the
Corporation to any liability to the holders of the
Rights.
|
|
5.19
|
Rights
of Board, Corporation and Offeror. Without limiting
the generality of the foregoing, nothing contained herein shall be
construed to suggest or imply that the Board of Directors shall not
be
entitled to recommend that holders of Voting Shares reject or accept
an
Takeover Bid or take any other action (including, without limitation,
the
commencement, prosecution, defence or settlement of any litigation
and the
submission of additional or alternative Take-over Bids or other proposals
to the Shareholders of the Corporation) with respect to any Take-over
Bid
or otherwise that the Board of Directors believes is necessary or
appropriate in the exercise of its fiduciary
duties.
|
44
|
5.20
|
Regulatory
Approvals. Any obligation of the Corporation or action
or event contemplated by this Agreement shall be subject to the prior
receipt of any requisite approval or consent from any governmental
or
regulatory authority including, without limiting the generality of
the
foregoing, any necessary approval of any securities regulatory authority,
The Toronto Stock Exchange or any other stock
exchange.
|
|
5.21
|
Declaration
as to Non-Canadian Holders. If in the opinion of the
Board of Directors (who may rely upon the advice of counsel) any
action or
event contemplated by this Agreement would require compliance with
the
securities laws or comparable legislation of a jurisdiction outside
Canada, the Board of Directors acting in good faith may take such
actions
as it may deem appropriate to ensure such compliance. In no event
shall
the Corporation or the Rights Agent be required to issue or deliver
Rights
or securities issuable on exercise of Rights to Persons who are citizens,
residents or nationals of any jurisdiction other than Canada or the
United
States in which such issue or delivery would be unlawful without
registration of the relevant Persons or securities for such
purposes. United States Persons, as such term is defined in
Regulation S of the 1933 Securities Act, may not exercise the Rights
granted pursuant to this Agreement unless the Common Shares to be
issued
pursuant to the exercise of such Rights are either registered under
the
1933 Securities Act, or there is an appropriate exemption from
registration.
|
|
5.22
|
Time
of the Essence. Time shall be of the essence in this
Agreement.
|
|
5.23
|
Execution
in Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall
together constitute one and the same
instrument.
|
|
5.24
|
Expiration
Time. If the Separation Time shall have occurred, then
(notwithstanding anything to the contrary in this Agreement) this
Agreement and the Rights shall continue in full force and effect
until
such time as there shall be no further
Rights.
|
[SIGNATURE
PAGE FOLLOWS]
45
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
“Xxx
Xxxxxx”
_____________________
Name:
Xxx Xxxxxx
Title:
VP, Finance and Administration
CIBC
MELLON TRUST COMPANY
“Xxx
Xxx”
_____________________
Name:
Xxx Xxx
Title:
Authorized Signatory
“Xxxxx
Xxxxxxx”
_____________________
Name:
Xxxxx Xxxxxxx
Title:
Authorized Signatory
46
EXHIBIT
“A-1”
[FORMS
OF RIGHTS CERTIFICATE]
Certificate
No.
___________________________ _____________________
Rights
THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE CORPORATION, ON THE
TERMS
SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES,
RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON, ANY PERSON ACTING JOINTLY
OR
IN CONCERT WITH AN ACQUIRING PERSON OR THEIR RESPECTIVE ASSOCIATES AND
AFFILIATES (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND THEIR
RESPECTIVE TRANSFEREES SHALL BECOME VOID WITHOUT ANY FURTHER
ACTION.
RIGHTS
CERTIFICATE
This
certifies that _______________________________ or registered assigns, is the
registered holder of the number of Rights set forth above, each of which
entitles the registered holder thereof, subject to the terms, provisions and
conditions of the Shareholder Rights Plan Agreement dated as of the ____ day
of
October, 2007 (the "Rights Agreement") between YM BioSciences Inc., a
corporation continued under the Companies Act (Nova Scotia) (the
"Corporation"), and CIBC Mellon Trust Company, a trust company incorporated
under the laws of Canada, as rights agent (the "Rights Agent", which term shall
include any successor Rights Agent under the Rights Agreement) to purchase
from
the Corporation at any time after the Separation Time and prior to the
Expiration Time (as such terms are defined in the Rights Agreement) one fully
paid and non-assessable Common Share of the Corporation (a "Common Share")
at
the Exercise Price referred to below, upon presentation and surrender of this
Rights Certificate together with the Form of Election to Exercise duly executed
and submitted to the Rights Agent at its principal office in the City of
Toronto. The Exercise Price shall initially be $200.00 (Canadian) per Right
and
shall be subject to adjustment in certain events as provided in the Rights
Agreement. In certain circumstances described in the Rights Agreement, each
Right evidenced hereby may entitle the registered holder thereof to purchase
or
receive assets, debt securities or other equity securities of the Corporation
(or a combination thereof) all as provided in the Rights Agreement. This Rights
Certificate is subject to all of the terms, provisions and conditions of the
Rights Agreement, which terms, provisions and conditions are hereby incorporated
herein by reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights, limitations
of
rights, obligations, duties and immunities thereunder of the Rights Agent,
the
Corporation and the holders of the Rights. Copies of the Rights Agreement are
on
file at the registered head office of the Corporation and are available upon
written request.
47
This
Rights Certificate, with or without other Rights Certificates, upon surrender
at
any of the offices of the Rights Agent designated for such purpose, may be
exchanged for another Rights Certificate or Rights Certificates of like tenor
and date evidencing an aggregate number of Rights entitling the holder to
purchase a like aggregate number of Common Shares as the Rights evidenced by
the
Rights Certificate or Rights Certificates surrendered. If this Rights
Certificate shall be exercised in part, the registered holder shall be entitled
to receive, upon surrender hereof, another Rights Certificate or Rights
Certificates for the number of whole Rights not exercised.
Subject
to the provisions of the Rights Agreement, the Rights evidenced by this Rights
Certificate (i) may be, and under certain circumstances are required to be,
redeemed by the Corporation at a redemption price of $0.0001 per Right; and
(ii)
may be exchanged at the option of the Corporation for cash, debt or equity
securities or other assets of the Corporation.
No
fractional Common Shares will be issued upon the exercise of any Right or Rights
evidenced hereby.
No
holder of this Rights Certificate, as such, shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of Common Shares or of any
other securities of the Corporation which may at any time be issuable upon
the
exercise hereof, nor shall anything contained in the Rights Agreement or herein
be construed to confer upon the holder hereof, any of the rights of a
shareholder of the Corporation or any right to vote for the election of
directors or upon any matter submitted to shareholders of the Corporation at
any
meeting thereof, or to give or withhold consent to any corporate action, or
to
receive notice of meetings or other actions affecting shareholders of the
Corporation (except as expressly provided in the Rights Agreement), or to
receive dividends, distributions or subscription rights, or otherwise until
the
Rights evidenced by this Rights Certificate shall have been exercised as
provided in the Rights Agreement.
This
Rights Certificate shall not be valid or obligatory for any purpose until it
shall have been manually countersigned by the Rights Agent.
WITNESS
the facsimile signature of the proper officers of the
Corporation.
Date:
______________________
|
By:
____________________________
|
By:
____________________________
|
|
Chairman
and Chief Executive Officer
|
Vice
President, Finance and
|
|
Administration
|
Countersigned
CIBC
MELLON TRUST COMPANY
Transfer
Agent and Registrar
By:
____________________________
Authorized
Signature
48
(To
be attached to each Rights Certificate)
FORM
OF ELECTION TO EXERCISE
TO:
YM BIOSCIENCES INC.
The
undersigned hereby irrevocably elects to exercise ____________________ whole
Rights represented by the attached Rights Certificate to purchase the Common
Shares issuable upon the exercise of such Rights and requests that certificates
for such Shares be issued to:
___________________________________________
(Name)
___________________________________________
(Address)
___________________________________________
(City
and State or Province)
___________________________________________
Social
Insurance, Social Security or Other Taxpayer Number
If
such number of Rights shall not be all the Rights evidenced by this Rights
Certificate, a new Rights Certificate for the balance of such Rights shall
be
registered in the name of and delivered to:
___________________________________________
(Name)
___________________________________________
(Address
)
___________________________________________
(City
and State or Province)
___________________________________________
Social
Insurance, Social Security or Other Taxpayer Number
Date
|
Guaranteed
by an
|
|
||
|
Eligible
Institution:
|
Signature
|
||
|
(Signature
must correspond to name as written upon the face of this Rights
Certificate in every particular. Without alteration or enlargement
or any
change whatsoever)
|
49
An
"Eligible Institution" means a Canadian Schedule 1 chartered bank, a major
trust
company in Canada, a member of the Securities Transfer Association Medallion
Program (STAMP), a member of the Stock Medallion Program (SEMP) or a member
of
the New York Stock Exchange Inc. Medallion Signature Program (MSP). Members
of
these programs are usually members of a recognized stock exchange in Canada
and
the United States, members of the Investment Dealers Association of Canada,
members of the National Association of Securities Dealers or banks and trust
companies in the United States.
[To
be completed if true]
The
undersigned hereby represents, for the benefit of all holders of Rights and
Common Shares, that the Rights evidenced by this Rights Certificate are not,
and, to the knowledge of the undersigned, have never been, Beneficially Owned
by
an Acquiring Person or an Affiliate or Associate thereof or any Person acting
jointly or in concert with any of the foregoing (as defined in the Rights
Agreement).
___________________________________________________________________
Signature
NOTICE
In
the event the certification set forth in the Form of Election to Exercise is
not
completed, the Corporation will deem the Beneficial Owner of the Rights
evidenced by this Rights Certificate to be an Acquiring Person or an Affiliate
or Associate thereof (as defined in the Rights Agreement) and accordingly such
Rights shall be null and void.
50
FORM
OF ASSIGNMENT
(To
be executed by the registered holder if such
holder
desires to transfer the Rights Certificate)
FOR
VALUE RECEIVED ________________________________________ hereby sells,
assigns
and transfers unto ______________________________________ (Please print name
and address of transferee) the Rights represented by this Rights
Certificate, together with all right, title and interest therein and does hereby
irrevocably constitute and appoint _____________________________ as attorney
to
transfer the within Rights on the books of the Corporation, with full power
of
substitution.
Dated
____________________
|
Guaranteed
by an
|
||||
|
Eligible
Institution:
|
Signature
|
|||
|
(Signature
must correspond to name as written upon the face of this Rights
Certificate in every particular without alteration or enlargement
or any
change whatsoever)
|
An
"Eligible Institution" means a Canadian Schedule 1 chartered bank, a major
trust
company in Canada, a member of the Securities Transfer Association Medallion
Program (STAMP), a member of the Stock Medallion Program (SEMP) or a member
of
the New York Stock Exchange Inc. Medallion Signature Program (MSP). Members
of
these programs are usually members of a recognized stock exchange in Canada
and
the United States, members of the Investment Dealers Association of Canada,
members of the National Association of Securities Dealers or banks and trust
companies in the United States.
[To
be completed if true]
The
undersigned hereby represents, for the benefit of all holders of Rights and
Common Shares, that the Rights evidenced by this Rights Certificate are not,
and, to the knowledge of the undersigned, have never been, Beneficially Owned
by
an Acquiring Person or an Affiliate or Associate thereof or any Person acting
jointly or in concert with any of the foregoing (as defined in the Rights
Agreement).
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Signature
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NOTICE
In
the event the certification set forth in the Form of Assignment is not
completed, the Corporation will deem the Beneficial Owner of the Rights
evidenced by this Rights Certificate to be an Acquiring Person or an Affiliate
or Associate thereof (as defined in the Rights Agreement) and accordingly such
Rights shall be null and void.
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