EXHIBIT 99.1
RIGHTS AGENCY AND CUSTODIAL AGREEMENT
THIS AGREEMENT MADE as of the _____ day of July, 0000
X X X X X X X:
American Natural Energy Corporation, a
corporation incorporated under the laws
of the State of Oklahoma,
(the "COMPANY")
- and -
COMPUTERSHARE TRUST COMPANY OF CANADA, a
trust company existing under the laws
of Canada,
(the "AGENT")
WHEREAS the Company has resolved to issue rights (the "Rights") to
purchase Common Shares (as hereinafter defined) of the Company
AND WHEREAS the Rights are to be issued to Common Shareholders of the
Company (as hereinafter described) but delivered only to certain Common
Shareholders;
AND WHEREAS by a transfer agency agreement the Agent acts as registrar
and transfer agent in the City of Toronto, for the common shares;
AND WHEREAS the Company deems it expedient that the Agent act as
registrar and transfer agent for the Rights and as custodian of monies tendered
upon exercise of the Rights and as custodian of Rights of Non-Qualified
Shareholders (as hereinafter defined);
AND WHEREAS the foregoing recitals and statements of fact are made by
the Company and not by the Agent.
NOW THEREFORE, in consideration of the mutual covenants herein set
forth, the parties agree as follows:
1. DEFINITIONS:
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1.01 In this Agreement terms with initial capital letters not otherwise
defined in this Agreement have the meaning ascribed thereto in the Rights
offering circular, hereinafter described:
(a) "Additional Shares" means the number of shares available for
subscription after exercise of the Rights pursuant to the exercise
of the Additional Subscription Privilege;
(b) "Additional Subscription Privilege" means the privilege of certain
holders of Rights to subscribe for Additional Shares after the
exercise of all of their Rights;
(c) "Agreement" means this agreement;
(d) "Common Shares" means the issued and outstanding common shares in
the capital of the Company;
(e) "Common Shareholders" means the holders from time to time of the
Common Shares;
(f) "Expiry Date" means 5:00 pm, New York City time on August [__],
2004];
(g) "Non-Qualified Jurisdiction" means jurisdictions other than each
of the provinces [and territories] of [list provinces and
territories, if applicable] and such other jurisdictions outside
of Canada as may be determined by the Company;
(h) "Non-Qualified Shareholders" means all Common Shareholders whose
address on the Record Date is in a Non-Qualified Jurisdiction;
(i) "Qualified Jurisdictions" means the provinces [and territories] of
[list provinces and territories if applicable] and such other
jurisdictions outside of Canada as may be determined by the
Company;
(j) "Record Date" means as at the close of business on July [__],
2004];
(k) "Rights" has the meaning ascribed thereto in the recitals to this
Agreement;
(l) "Rights Certificates" has the meaning ascribed thereto in
paragraph 2.02(a);
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(m) "Rights Offering Circular" means the rights offering circular
dated July [__], 2004 pursuant to which the Rights are issued, a
copy of which, including the Company's Prospectus dated July [__],
2004 under the U.S. Securities Act of 1933, as amended, is
attached hereto as Schedule "A"; and
(n) "Subscription Funds" means any and all monies tendered by eligible
holders of Rights for the purchase of Common Shares.
2. APPOINTMENT OF AGENT:
---------------------
2.01 The Agent is hereby appointed as registrar and transfer agent for the
Rights and the Agent hereby accepts such appointment upon the terms hereinafter
set forth.
2.02 The Agent shall keep the Company's register of Rights (the "Register"),
register of transfers and supply of unissued Rights Certificates. Subject to
such instructions as may be from time to time given by the Company in writing
through any of its President, Vice-President or Secretary or other duly
authorized officer and in accordance with the Rights Offering Circular, the
Agent shall:
(a) issue as of the Record Date to the Common Shareholders and hold on
behalf of the Non-Qualified Shareholders, certificates
representing the Rights (the "Rights Certificates") as
contemplated by the Rights Offering Circular and enter the
issuance of such certificates on the Company's register of
transfers;
(b) forward to each Common Shareholder, other than Non-Qualified
Shareholders, the Rights Offering Circular, the Rights
Certificates issued to each Common Shareholder, an applicable
covering letter and a return envelope addressed to the Agent and
forward to the Non-Qualified Shareholders, the Rights Offering
Circular and an applicable covering letter;
(c) record transfers of Rights and cancel Rights Certificates
surrendered upon such transfers provided that no transfer of
Rights shall be made or Rights Certificates issued to a transferee
where the transferee's address of record is in a Non-Qualified
Jurisdiction;
(d) in accordance with the Rights Offering Circular, accept for
exercise Rights, along with Subscription Funds, from holders of
Rights (other than Non-Qualified Shareholders) and cancel such
Rights Certificates properly presented;
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(e) in accordance with the Rights Offering Circular, accept
subscriptions for Common Shares, along with Subscription Funds,
from holders of Rights entitled to subscribe for Additional Common
Shares pursuant to the exercise of the Additional Subscription
Privilege, and allocate the Additional Common Shares to those
participants;
(f) in the event that any Common Shares remain available for
subscription on the Expiry Date after the exercise of the Rights
and the Additional Subscription Privilege, advise the Company of
the number of Common Shares which remain available;
(g) until the Expiry Date, make such entries from time to time in the
said register as may be necessary in order that the account of
each holder of Rights of the Company may be properly and
accurately kept;
(h) supply the Company from time to time as requested in writing with
lists of holders of Rights as shown by the said register correct
to the dates of such lists showing the name and last known address
of each holder and the number of Rights held by each holder;
(i) forward certificates representing the Common Shares subscribed for
and purchased pursuant to each exercise of Rights to the relevant
subscriber as soon as practicable after the Expiry Date; and
(j) send to each holder of Rights exercising the Additional
Subscription Privilege and remitting excess funds, a cheque
representing the amount of such excess funds (without interest or
deduction) paid by such holder of Rights in respect of the
subscription for Additional Common Shares not available to be
issued to such holder of Rights.
3. THE RIGHTS:
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3.01 The Rights will be issued to all Common Shareholders shown on the
register of Common Shares on the Record Date, will be in fully registered form
and will be freely transferable. Rights will be exercisable in accordance with
the Rights Offering Circular.
3.02 No Rights will be delivered to Non-Qualfiied Shareholders. The Agent
shall be issued a single Rights Certificate representing all Rights of
Non-Qualified Shareholders.
3.03 The Agent agrees to transfer the Rights of Non-Qualified Shareholders
upon the instructions of such Non-Qualified Shareholders received by the Agent
prior to 5:00 pm, New York City time on August [__], 2004], provided that such
transfer is not made to a resident of a Non-Qualified Jurisdiction. In the
absence of instructions by such Non-
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Qualified Shareholders to transfer their Rights to a designated person prior to
the time specified above, the Agent agrees to use its best efforts to sell such
Rights thereafter and at any time prior to the Expiry Date at the price or
prices it determines in its absolute discretion. The Agent does not accept
responsibility if it is unable to effect the sale of such rights at a particular
price or at all.
3.04 No charge will be imposed for Rights sold through the Agent except for
brokerage commissions, any taxes and any other fees or charges incurred by the
Agent in respect of such sales.
3.05 The proceeds received by the Agent from the sale of the Rights as
contemplated in Section 3.03 hereof will be divided pro rata among the
Non-Qualified Shareholders, net of all applicable taxes, brokerage commissions,
and fees or charges, and the Agent shall provide cheques as soon as practicable
to the Non-Qualified Shareholders at their addresses recorded in the register of
Common Shares. The Agent shall not be required to make any such payment to any
Non-Qualified Shareholder in the event the amount owing to such shareholder is
less than (US)$10.00. Such amount may be forwarded to the Company.
4. TAX MATTERS:
------------
4.01 The Company shall instruct the Agent in writing of the tax forms, if
any, that are to be issued and the appropriate filings that are to be made with
the Canada Customs and Revenue Agency prior to the Expiry of the Rights
Offering.
5. APPOINTMENT OF CUSTODIAN:
-------------------------
5.01 The Agent is hereby appointed as custodian for the receipt and holding
of the Subscription Funds and the Agent hereby accepts such appointment. All
Subscription Funds shall be maintained in US dollars.
5.02 The Agent is hereby also appointed as custodian of all Rights of all
Non-Qualified Shareholders. All such Rights shall be held by the Agent for the
benefit of such persons and dealt with in accordance with Article 4 hereof.
6. DELIVERY OF SUBSCRIPTION FUNDS:
-------------------------------
6.01 Any Subscription Funds which may be received by the Company will be
promptly delivered or paid over to the Agent.
6.02 Promptly after the Expiry Date and after the calculation and tabulation
of all properly tendered subscriptions, the Subscription Funds will be paid by
the Agent to the Company. However, it is agreed that no Subscription Funds will
be paid to the Company
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unless the Company has provided a sufficient supply of unissued certificates to
issue the certificates representing the Common Shares subscribed for and
purchased.
7. COVENANTS BY THE COMPANY:
-------------------------
7.01 The Company covenants with the Agent that:
(a) it will pay the Agent reasonable remuneration for its services
hereunder as per Schedule "B" attached and will pay to the Agent
the amount of all out-of-pocket expenses (including, but not
limited to, postage, courier, stationery, mailing insurance,
photocopying, telecommunications, long distance calls, overtime,
and legal fees) which the Agent reasonably incurs in the execution
of its obligations hereunder. All fees and out-of-pocket expenses
will be paid within thirty days from the date of the invoice and
late payment may be subject to interest charges as indicated on
the invoice; and
(b) it will promptly give notice to the Agent of any and all changes
to the terms and conditions of the Rights, which it may resolve to
make from time to time and that it will prepare and execute any
and all documents to amend this Agreement pursuant to any such
changes made.
8. REPLACEMENT OF LOST RIGHTS CERTIFICATES:
----------------------------------------
8.01 The authority of the Agent shall also extend to the issue as transfer
agent and registrar of any Rights Certificate, the issue of which may be
authorized in writing by the Company through any of its President,
Vice-President or Secretary or other duly authorized officer in lieu of a Rights
Certificate or Rights Certificates claimed to have been lost, destroyed or
stolen.
8.02 The applicant for the issue of a new Rights Certificate(s) pursuant to
this Article 8 shall bear the cost of the issue thereof and in case of loss,
destruction or theft shall, as a condition precedent to the issue thereof,
furnish to the Agent and the Company such evidence of ownership and of the loss,
destruction or theft of the Rights Certificate satisfactory to the Company and
to the Agent in their sole discretion, and such applicant shall also be required
to furnish indemnity in amount and form satisfactory to the Company and the
Agent, to save each of them harmless, and shall pay the expenses, charges and
any taxes applicable thereto to the Company and the Agent in connection
therewith.
8.03 No new Rights Certificate or Rights Certificates shall be issued in
lieu of a Rights Certificate or Rights Certificate claimed to have been lost,
destroyed or stolen until a statutory declaration and indemnity bond in form
satisfactory to the Company and the
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Agent shall have been furnished to the Agent; provided that the provisions of
this Section may be waived upon terms mutually satisfactory to the Agent and the
Company.
9 LIABILITY:
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9.01 The Agent shall incur no responsibility or liability in regard to any
claims, demands, losses, penalties, damages, expenses, fees, costs, levies and
liabilities, including without limitation, legal fees and expenses, in regard to
the funds deposited with it or for any action taken or not taken in connection
with or under this Agreement, except where same results directly and principally
from its gross negligence or bad faith. Under no circumstances whatsoever shall
the Agent be liable for special, indirect, incidental or consequential loss or
damage of any kind whatsoever (including, but not limited to, lost profits) even
if the Agent has been advised of the possibility of such loss or damage.
Notwithstanding any other provision of this Agreement, this Article shall
survive the termination of this Agreement.
10. INDEMNITY OF THE AGENT:
-----------------------
10.01 The Company hereby indemnifies the Agent, its affiliates, the
directors, officers, employees and agents and saves them harmless from and
against any and all liabilities, claims, losses, demands, expenses, fees, suits,
actions, proceedings, judgments, penalties, damages, levies and costs,
including, without limitation, legal fees and expenses, of whatever kind or
nature, which may at any time be suffered by, imposed on, incurred by or
asserted against the Agent, whether groundless or otherwise, howsoever arising
from or out of any act, omission or error of the Agent in connection with this
Agreement provided that the Agent has acted in good faith and without gross
negligence. Notwithstanding any other provision of this Agreement, this
indemnity shall survive the termination of this Agreement.
10.02 Without in any way limiting the generality of the foregoing indemnity,
the Agent may apply at any time to the Company, to counsel for the Company, or
to its own counsel at the expense of the Company for instructions or advice, and
the Company will fully indemnify and hold the Agent harmless from any liability
for any action taken by the Agent in accordance with, in reliance on or pursuant
to such instructions or advice as may be given to it by any of the Chairman,
President, Vice-President or Secretary or other duly authorized officer of the
Company or instructions or advice of counsel for the Company or of its own
counsel. Notwithstanding any other provision of this Agreement, this indemnity
shall survive the termination of this Agreement.
11. CONCERNING THE AGENT:
---------------------
11.01 The Agent shall incur no liability and shall be fully protected in
acting and
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relying upon any written notice, direction, instruction, request, waiver,
consent, receipt or other paper or document furnished to it and signed by the
parties thereto, not only as to its due execution and validity and the
effectiveness of its provision but also to the truth and accuracy of any
information therein contained which it in good faith believes to be genuine.
11.02 The Agent may use its own judgment in the performance of its
obligations hereunder. The Agent shall not be obliged to take any action which
might in its judgment involve any expense or liability unless the Agent shall
have been furnished with reasonable funding and indemnity.
11.03 The Agent shall have no duties except those which are expressly set
forth herein and it shall not be bound by any notice of a claim or demand with
respect to, or any waiver, modification, amendment, termination or rescission of
this Agreement, unless received by it in writing, and signed by the parties
hereto and, if its duties are herein affected, unless it shall have given prior
written consent thereto.
12. NOTICES:
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12.01 All notices required to be made or given pursuant to this Agreement
shall be in writing and shall be deemed to be validly given if delivered
personally or by prepaid courier, or if sent by registered letter, postage
prepaid, or if sent by facsimile. Any notice so mailed shall be deemed to have
been given and received by the addressee on the fourth business day next
following the day on which such notice is mailed, or, if sent by facsimile shall
be deemed to have been received on the date upon which an acknowledgement of
receipt is received from the addressee provided that if such acknowledgement of
receipt is received after 4:00 p.m. (Toronto time) such notice shall be deemed
to be received on the next business day, or, if delivered, shall be deemed to
have been given on the delivery date, at the offices and to the parties at the
addresses shown below:
If to the Agent:
Computershare Trust Company of Canada
000 Xxxxxxxxxx Xxxxxx, 0xx xxxxx
Xxxxxxx, XX X0X 0X0
Attention: Senior Manager, Client Services
Facsimile Number:
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If to the Company:
American Natural Energy Corporation
0000 Xxxxx Xxxx
Xxxxx000
Xxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Facsimile Number: (000) 000-0000
13. FORCE MAJEURE:
--------------
13.01 Neither party shall be liable to the other, or held in breach of this
Agreement, if prevented, hindered, or delayed in the performance or observance
of any provision contained herein by reason of act of God, riots, acts of war,
epidemics, governmental action or judicial order, earthquakes, or any other
similar causes (including, but not limited to, mechanical, electronic or
communication interruptions, disruptions or failures). Performance times under
this Agreement shall be extended for a period of time equivalent to the time
lost because of any delay that is excusable under this Article.
14. GENERAL:
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14.01 It is understood and agreed that any benefits accruing to the holders
of Rights at any time are held by each and every holder as against the Company
alone. In all respects, subject to Article 3 and Section 5.02 hereof, the Agent
shall act as agent of the Company in the execution of duties assumed hereunder.
14.02 In the event of any inconsistency between the provisions of this
Agreement and the Rights Offering Circular, the terms of the Rights Offering
Circular shall govern.
14.03 Time shall be of the essence of this Agreement.
14.04 This Agreement shall enure to the benefit of and be binding upon the
successors and assigns of the parties hereto.
14.05 This Agreement shall be governed by and construed in accordance with
the laws of the Province of Ontario.
14.06 Subject headings as used in this Agreement are for convenience of
reference only and shall not affect the construction or interpretation of this
Agreement.
14.07 This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which, taken together, shall
constitute one and the same instrument.
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IN WITNESS WHEREOF the parties hereto have executed this Agreement as
of the day and year first above written.
AMERICAN NATURAL ENERGY CORPORATION
PER:
------------------------------
Name: Xxxxxxx X. Xxxxx
Tile: President
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COMPUTERSHARE TRUST COMPANY OF CANADA
PER:
------------------------------
Name:
Title:
PER:
------------------------------
Name:
Title:
SCHEDULE"A"
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SCHEDULE"B"
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