Ontario, Canada
(State or other jurisdiction
of incorporation or organization)
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N/A
(I.R.S. Employer
Identification No.)
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354 Davis Road
Oakville, Ontario, Canada
(Address of Principal Executive Offices) |
L6J 2X1
(Zip Code) |
Title of each class
to be so registered |
Name of each exchange on which
each class is to be registered |
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6.875% Fixed-to-Floating Subordinated Notes – Series 2018-A due October 17, 2078
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New York Stock Exchange
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Exhibit
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Number
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Description
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Restated Articles of Algonquin Power & Utilities Corp., as amended.
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By-laws of Algonquin Power & Utilities Corp.
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Indenture dated October 17, 2018, by and among Algonquin Power & Utilities Corp., American Stock Transfer Trust Company, LLC, as the U.S. Trustee, and AST Trust Company (Canada), as the Canadian Co-Trustee.
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First Supplemental Indenture dated October 17, 2018, by and among Algonquin Power & Utilities Corp., American Stock Transfer Trust Company, LLC, as the U.S. Trustee, and AST Trust Company (Canada), as the Canadian Co-Trustee.
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Form of 6.875% Fixed-to-Floating Subordinated Note – Series 2018-A due October 17, 2078 (included in Exhibit
4.2
hereto).
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Provisions Attaching to Fixed-To-Floating Preferred Shares, Series F of Algonquin Power & Utilities Corp. (included in Exhibit
3.1
hereto).
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ALGONQUIN POWER & UTILITIES CORP.
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By:
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s/ David Bronicheski
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Name: David Bronicheski
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Title: Chief Financial Officer
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(a)
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declare any dividend on the Common Shares or any other shares ranking junior to the Preferred Shares, Series F (other than stock dividends on shares ranking junior to the Preferred Shares, Series F);
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(b)
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redeem, purchase or otherwise retire any Common Shares or any other shares ranking junior to the Preferred Shares, Series F (except out of the net cash proceeds of a substantially concurrent issue of shares ranking junior to the Preferred Shares, Series F); or
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(c)
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redeem, purchase or otherwise retire: (i) less than all the Preferred Shares, Series F; or (ii) except pursuant to any purchase obligation, sinking fund, retraction privilege or mandatory redemption provisions attaching to any series of preferred shares of the Corporation, any other shares ranking on a parity with the Preferred Shares, Series F,
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IV.1
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CUMULATIVE RATE RESET PREFERRED SHARES, SERIES D
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(a)
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Dividends
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(i)
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Dividend Periods and Dividend Payment Dates
.
A “Dividend Period” means the period from and including the date of initial issue of the Series D Shares to, but excluding, June 30, 2014 and, thereafter, the next succeeding period that is from and including the 31st day (each, a “Quarter End Date”) of each of the months of March, June, September and December in each year, as the case may be, to but excluding the next succeeding Quarter End Date. The dividend payment dates (the “Dividend Payment Dates”) in respect of the dividends payable on the Series D Shares shall be the last day (or, if such day is not a Business Day, the immediately following Business Day) of each of the months of March, June, September and December in each year.
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(ii)
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Payment of Dividends
.
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(A)
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During the Initial Fixed Rate Period and each Subsequent Fixed Rate Period, the holders of Series D Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the board of directors of the Corporation
(
the
“Board”), out of moneys of the Corporation properly applicable to the payment of dividends, fixed, cumulative, preferential cash dividends (the “Quarterly Dividends”) in the amounts set forth in subsection IV.1(a)(ii)(B) payable, with respect to each Dividend Period, on the Dividend Payment Date in respect of such Dividend Period.
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(B)
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Subject to subsection IV.1(a)(iii), for all Dividend Periods during:
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(1)
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the Initial Fixed Rate Period, each Quarterly Dividend shall be in an amount equal to $0.31250 per Series D Share (being an annual rate equal to $1.25 per Series D Share); and
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(2)
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each Subsequent Fixed Rate Period, each Quarterly Dividend shall be in an amount per Series D Share equal to the result of the following calculation: ¼ x [($25.00 x AFDR)], where “AFDR” means the Annual Fixed Dividend Rate applicable to such Subsequent Fixed Rate Period.
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(C)
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The Corporation shall determine the Annual Fixed Dividend Rate for each Subsequent Fixed Rate Period on the relevant Fixed Rate Calculation Date. Such determination shall, in the absence of manifest error, be final and binding on the Corporation and all holders of Series D Shares. The Corporation shall, on the relevant Fixed Rate Calculation Date, give written notice of the Annual Fixed Dividend Rate for the ensuing Subsequent Fixed Rate Period to the registered holders of the then outstanding Series D Shares in accordance with the provisions of subsection IV.1(f)(i).
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(D)
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Dividends on the Series D Shares shall accrue daily from and including the date of issue of such shares.
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(iii)
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Initial Dividend and Dividend for Other than a Full Dividend Period
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The holders of Series D Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the Board out of moneys of the Corporation properly applicable to the payment of dividends, cumulative, preferential cash dividends for the initial period or any period which is less than
a
full Dividend Period, as follows:
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(A)
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an initial dividend in respect of the period from and including the date of the initial issue of the Series D Shares to but excluding June 30, 2014 in an amount per Series D Share equal to $1.25 multiplied by a fraction, the numerator of which is the number of calendar days from and including the date of the initial issue of the Series D Shares to but excluding June 30, 2014 and the denominator of which is 365, (which, if the Series D Shares are issued on March 5, 2014, shall be $0.4007 per Series D Share); and
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(B)
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a dividend in an amount per share with respect to any Series D Share:
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(1)
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which is issued, redeemed or converted during any Dividend Period;
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(2)
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where the assets of the Corporation are distributed to the holders of the Series D Shares pursuant to subsection IV.1(i) with an effective date during any Dividend Period; or
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(3)
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in any other circumstance where the number of days in a Dividend Period that such share has been outstanding is less than a full Dividend Period (other than the period referred to in subsection IV.1(a)(iii)(A)),
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(iv)
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Payment Procedure
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The Corporation shall pay the dividends declared on the Series D Shares on the relevant Dividend Payment Date (less any tax required to be deducted or withheld by the Corporation) by electronic funds transfer or by cheque(s) drawn on a Canadian chartered bank or trust company and payable in lawful money of Canada at any branch of such bank or trust company in Canada or in such other manner, not contrary to applicable law, as the Corporation shall reasonably determine. The delivery or mailing of any cheque to a holder of Series D Shares (in the manner provided for in subsection IV.1(f)(i)) or the electronic transfer of funds to an account specified by such holder shall be a full and complete discharge of the Corporation’s obligation to pay the dividends to such holder to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation from the related dividends as aforesaid and remitted to the proper taxing authority), unless such cheque is not honoured when presented for payment. Subject to applicable law, dividends which are represented by a cheque which has not been presented to the Corporation’s banker for payment or that otherwise remain unclaimed for a period of six years from the date on which they were declared to be payable may be reclaimed and used by the Corporation for its own purposes.
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(v)
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Cumulative Payment of Dividends
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If on any Dividend Payment Date, the Quarterly Dividends payable in respect of the Dividend Period ending in the calendar month in which such Dividend Payment Date occurs are not paid in full on all of the Series D Shares then outstanding, such Quarterly Dividends, or the unpaid part thereof, shall be paid (less any tax required to be deducted or withheld by the Corporation) on a subsequent date or dates determined by the Board on which the Corporation shall have sufficient monies properly applicable to the payment of such Quarterly Dividends. The holder of Series D Shares shall not be entitled to any dividends other than or in excess of the cumulative preferential cash dividends herein provided for.
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(vi)
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Priority
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The Series D Shares rank senior to the Common Shares and rank on a parity with every other series of Preferred Shares as to dividends.
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(b)
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Redemption, Conversion and Purchase
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(i)
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General
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To the extent permitted by applicable law, the Series D Shares may be redeemed, converted or purchased by the Corporation as provided in this subsection IV.1(b) but not otherwise.
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(ii)
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Corporation’s Redemption Rights
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The Series D Shares shall not be redeemable by the Corporation prior to March 31, 2019. On any Series D Conversion Date, the Corporation may redeem all or any number of the outstanding Series D Shares, at its option, by the payment in cash of $25.00 per share so redeemed together with all accrued and unpaid dividends thereon up to, but excluding, the date fixed for redemption (less any tax required to be deducted or withheld by the Corporation) (the “Redemption Price”). Where applicable, if less than all of the outstanding Series D Shares are at any time to be redeemed, the particular shares to be redeemed shall
be
selected on a pro rata basis (disregarding fractions) or, with the consent of any applicable stock exchange, in such other manner as the Board may in its sole discretion determine by resolution.
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(iii)
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Notice of Redemption
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Notice of any redemption of Series D Shares pursuant to subsection IV.1(b)(ii) shall be given to each holder of Series D Shares to be redeemed by the Corporation at least 30 and not more than 60 days prior to the date fixed for redemption. Any notice of redemption of Series D Shares by the Corporation shall be validly and effectively given on the date on which it is sent to each holder of Series D Shares to be redeemed in the manner provided for in subsection IV.1(f)(i). Such notice shall set out:
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(A)
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the date (the “Redemption Date”) on which the redemption is to take place;
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(B)
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unless all the Series D Shares held by the holder to whom it is addressed are to be redeemed, the number of Series D Shares so held which are to be redeemed; and
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(C)
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the Redemption Price.
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(iv)
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Payment of Redemption Price
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The Corporation shall on the Redemption Date pay or cause to be paid to the holders of the Series D Shares so called for redemption the Redemption Price therefor on presentation and delivery at the principal transfer office of the Transfer Agent in the city of Toronto or such other place or places in Canada designated in the notice of redemption, of the certificate or certificates representing the Series D Shares so called for redemption. Such payment shall be made by electronic funds transfer to an account specified by such holder or by cheque drawn on a Canadian chartered bank or trust company in the amount of the Redemption Price and such electronic transfer of funds or the delivery or mailing of such cheque (in the manner provided for in subsection IV.1(f)(i)) shall be a full and complete discharge of the Corporation’s obligation to pay the Redemption Price owed to the holders of Series D Shares so called for redemption to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation as aforesaid and remitted to the proper taxing authority) unless such cheque is not honoured when presented for payment. From and after the Redemption Date, the holders of Series D Shares called for redemption shall cease to be entitled to dividends or to exercise any of the rights of holders of Series D Shares in respect of such shares except the right to receive the Redemption Price, provided that if payment of such Redemption Price is not duly made in accordance with the provisions hereof, then the rights of such holders shall remain unimpaired. If less than all the Series D Shares represented by any certificate shall be redeemed, a new certificate for the balance shall be issued without cost to the holder. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
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(v)
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Deposit of Redemption Price
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The Corporation shall have the right, at any time after mailing a notice of redemption, to deposit the aggregate Redemption Price for the Series D Shares thereby called for redemption, or such part thereof as at the time of deposit has not been claimed by the holders entitled thereto, in a special account with a Canadian chartered bank or trust company named in the notice of redemption in trust for the holders of such shares, and upon such deposit being made or upon the Redemption Date, whichever is the later, the Series D Shares in respect of which such deposit shall have been made shall be deemed to be redeemed on the Redemption Date and the rights of each holder thereof shall be limited to receiving, without interest, the holder’s proportionate part (after taking into account any amounts required to be deducted or withheld on account of tax in respect of such holder) of the Redemption Price so deposited upon presentation and surrender of the certificate or certificates representing the Series D Shares so redeemed. Any interest on any such deposit shall belong to the Corporation. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
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(vi)
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Declaration of Dividends in Respect of Shares to be Redeemed
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If a dividend is declared by the Board in respect of any Dividend Period during which the Series D Shares are redeemed, notwithstanding the provisions of subsection IV.1(a)(iv), no electronic funds transfer or cheque shall be made or issued in payment of such dividend; rather, the amount of such dividend declared shall be considered to be an accrued and unpaid dividend for purposes of subsection IV.1(b)(ii).
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(vii)
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Conversion at the Option of the Holder
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Subject to the second paragraph of subsection IV.1(b)(viii), subsection IV.1(b)(ix) and subsection IV.1(b)(x), each holder of Series D Shares shall have the right, at its option, on any Series D Conversion Date, to convert all or any part of its Series D Shares registered in its name into Cumulative Floating Rate Preferred Shares, Series E (the “Series E Shares”) on the basis of one Series E Share for each Series D Share converted. Such right may be exercised
by
notice in writing (an “Election Notice”) given not earlier than the 30th day prior to, and not later than 5:00 p.m. (Toronto time) on the 15th day preceding, the applicable Series D Conversion Date during usual business hours at any principal transfer office of the Transfer Agent, or such other place or places designated by the Corporation. On any conversion of Series D Shares into Series E Shares, the certificates representing the Series E Shares resulting from the conversion of Series D Shares to which such holder is entitled shall be issued in the name of the holder of the Series D Shares converted or in such name or names as such holder may direct in writing; provided that such holder shall pay any applicable security transfer taxes. Any Election Notice shall be accompanied by (1) payment or evidence of payment of the tax (if any) payable: and (2) the certificate or certificates representing the Series D Shares in respect of which the holder thereof desires to convert into Series E Shares with the transfer form on the back thereof or other appropriate stock transfer power of attorney duly endorsed by the holder, or his or her attorney duly authorized in writing, in which Election Notice such holder may elect to convert part only of the Series D Shares represented by such certificate or certificates not theretofore called for redemption in which event the Corporation will issue and deliver or cause to be delivered to such holder, at the expense of the Corporation. a new certificate representing the Series D Shares represented by such certificate or certificates that have not been converted. Such conversion shall be deemed to have been made at 5:00 p.m. (Toronto time) on the Series D Conversion Date, so that the rights of the holder of such Series D Shares as the holder thereof shall cease at such time and the person or persons entitled to receive the Series E Shares upon such conversion will be treated for all purposes as having become the holder or holders of record of such Series E Shares at such time. An Election Notice is irrevocable once received by the Corporation. If the Corporation does not receive an Election Notice within the specified time, the Series D Shares shall be deemed not to have been converted (subject to subsection IV.1(b)(ix)).
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(viii)
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Notice of Conversion Rate and Dividend Rates and Election
Notice
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The Corporation shall, at least 30 days and not more than 60 days prior to each Series D Conversion Date, provide notice in writing to the then registered holders of the Series D Shares of the Series D Conversion Date and a form of Election Notice as specified by the Corporation. On the 30th day prior to each Series D Conversion Date, the Corporation shall give notice in writing to the registered holders of the Series D Shares of the Annual Fixed Dividend Rate for the next Subsequent Fixed Rate Period and the Floating Quarterly Dividend Rate for the next Quarterly Floating Rate Period (as these terms are defined in the Series E Share Provisions).
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(ix)
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Automatic Conversion
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If the Corporation determines that there would remain outstanding on a Series D Conversion Date less than 1,000,000 Series D Shares, after having taken into account all Election Notices in respect of Series D Shares duly tendered for conversion into Series E Shares and all Election Notices in respect of Series
E
Shares duly tendered for conversion into Series D Shares in accordance with the Series E Share Provisions, in each case received by the Corporation during the time fixed therefor, then, all, but not part, of the remaining outstanding Series D Shares will automatically be converted into Series E Shares on the basis of one Series E Share for each Series D Share on the applicable Series D Conversion Date. The Corporation shall give notice in writing of the automatic conversion thereof to all holders of the Series D Shares at least seven days prior to the applicable Series D Conversion Date.
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(x)
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Restrictions on Conversion
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The holders of Series D Shares shall not be entitled to convert their shares into Series E Shares if the Corporation determines that there would remain outstanding on a Series D Conversion Date less than 1,000,000 Series E Shares after having taken into account all Election Notices in respect of Series D Shares duly tendered for conversion into Series E Shares and all Election Notices in respect of Series E Shares duly tendered for conversion into Series D Shares in accordance with the Series E Share Provisions, in each case received by the Corporation during the time fixed therefor. The Corporation shall give notice in writing of the inability to convert Series D Shares to all holders of the Series D Shares at least seven days prior to the applicable Series D Conversion Date.
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(xi)
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Non-Residents
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The Corporation is not required to (but may at its option) issue Series E Shares upon the conversion of Series D Shares into Series
E
Shares to any person whose address is in, or whom the Corporation or the Transfer Agent has reason to believe is a resident of, any jurisdiction outside Canada, to the extent that such issue would require the Corporation to take any action to comply with the securities laws or analogous laws of such jurisdiction.
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(xii)
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Purchase for Cancellation
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Subject to applicable laws, the Corporation may, at any time, purchase for cancellation (if obtainable), out of capital or otherwise, the whole or any part of the Series
D
Shares
outstanding from time to time at any price by tender to all holders of record of Series D Shares or through the facilities of any stock exchange on which the Series D Shares are listed, or in any other manner, provided that in the case of a purchase in
any
other manner the price for such Series D Shares so purchased for cancellation shall not exceed the highest price offered for a board lot of the Series D Shares on any stock exchange on which such shares are listed on the date of purchase for cancellation, plus the costs of purchase. If upon any tender to holders of Series D Shares under the provisions of this subsection IV.1(b)(xii), more shares are offered than the Corporation is prepared to purchase, the shares so offered will be purchased as nearly as may be pro rata (disregarding fractions) according to the number of Series D Shares so offered by each of the holders of Series D Shares who offered shares to such tender. From and after the date of purchase of any Series D Shares under the provisions of this subsection IV.1(b)(xii), the shares so purchased shall be cancelled.
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(xiii)
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Conversion — General
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On the conversion of a Series D Share to a Series E Share pursuant to the terms of these Series D Share Provisions, each such Series D Share shall become an issued Series E Share and the number of unissued Series D Shares shall be increased by the number of Series D Shares that became Series E Shares.
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(c) |
Voting Rights
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(i) |
Voting Rights – General
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Except as otherwise required by law or in the conditions attaching to the Preferred Shares as a class, the holders of Series D Shares shall not be entitled to receive notice of, attend at, or vote at any meeting of shareholders of the Corporation, unless and until the Corporation shall have failed to pay eight Quarterly Dividends on the Series D Shares in accordance with the terms hereof, whether or not consecutive and whether or not such dividends were declared and whether or not there are any monies of the Corporation properly applicable to the payment of such dividends. In the event of such non-payment, and for only so long as any such dividends remain in arrears, the holders of the Series D Shares shall be entitled to receive notice of all meetings of shareholders of the Corporation and to attend thereat (other than a separate meeting of the holders of another series or class of shares), and shall at any such meetings which they shall be entitled to attend, except when the vote of the holders of shares of any other class or series is to be taken separately and as a class or series, be entitled to vote together with all of the voting shares of the Corporation on the basis of one vote in respect of each Series D Share held by each such holder, until all such arrears of such dividends shall have been paid, whereupon such rights shall cease unless and until the Corporation shall again fail to pay eight Quarterly Dividends on the Series D Shares in accordance with the terms hereof, whether or not consecutive and whether or not such dividends were declared and whether or not there are any monies of the Corporation properly applicable to the payment of such dividends, in which event such voting rights shall become effective again and so on from time to time.
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(d) |
Issue Price
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(e) |
Election under the
Income Tax Act
(Canada)
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(f) |
Notice and Interpretation
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(i) |
Notices
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Any notice, cheque, invitation for tenders or other communication from the Corporation herein provided for shall be sufficiently given, sent or made if delivered or if sent by first class unregistered mail, postage prepaid, to the holders of the Series D Shares at their respective addresses appearing on the records of the Corporation maintained by the Corporation or the Transfer Agent, or, in the case of joint holders, to the address of the holder whose name appears first on the records of the Corporation maintained by the Corporation or the Transfer Agent as one of such joint holders, or, in the event of the address of any of such holders not so appearing, then at the last address of such holder known to the Corporation. Accidental failure to give such notice, invitation for tenders or other communication to one or more holders of the Series D Shares shall not affect the validity of the notices, invitations for tenders or other communications properly given or any action taken pursuant to such notice, invitation for tender or other communication but, upon such failure being discovered, the notice, invitation for tenders or other communication, as the case may be, shall be sent forthwith to such holder or holders. If any notice, cheque, invitation for tenders or other communication from the Corporation given to a holder of Series D Shares pursuant to this subsection is returned on three consecutive occasions because the holder cannot be found, the Corporation shall not be required to give or mail any further notices, cheques, invitations for tenders or other communications to such shareholder until the holder informs the Corporation in writing of such holder’s new address.
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(A) |
give such notice by publication thereof once in a newspaper having national circulation in Canada or, if there is no newspaper having national circulation in Canada, in an English language newspaper of general circulation published in each of Vancouver, Calgary, Toronto and Montreal and such notice shall be deemed to have been validly given on the day next succeeding its publication; and
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(B) |
fulfill the requirement to send such cheque or such share certificate by arranging for the delivery thereof to such holder by the Transfer Agent at its principal offices in the city of Toronto, and such cheque and/or share certificate shall be deemed to have been sent on the date on which notice of such arrangement shall have been given as provided in (A) above, provided that as soon as the Board determines that mail service is no longer interrupted or threatened to be interrupted, such cheque or share certificate, if not theretofore delivered to such holder, shall be sent by mail as herein provided.
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(ii) |
Interpretation
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If any day on which any dividend on the Series D Shares is payable, on which any Redemption Date or any Series D Conversion Date shall occur, or on or by which any other action is required or permitted to be taken hereunder is not a Business Day, then such dividend shall be payable, such Redemption Date or Series D Conversion Date shall occur or such other action shall be required or permitted to be taken on the immediately following day that is a Business Day.
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(A) |
“Annual Fixed Dividend Rate” means, for any Subsequent Fixed Rate Period, the annual rate (expressed as a percentage rounded to the nearest one hundred-thousandth of one percent (with 0.000005% being rounded up)) equal to the sum of the Government of Canada Yield on the applicable Fixed Rate Calculation Date plus 3.28%;
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(B) |
“Bloomberg Screen GCAN5YR Page” means the display designated as page “GCAN5YR<INDEX>” on the Bloomberg Financial L.P. service (or such other page as may replace the GCAN5YR page on that service or if such service is no longer available, a successor service as determined by the Corporation) for purposes of displaying Government of Canada Yields;
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(C) |
“Business Day” means a day other than a Saturday, a Sunday or any other day that is a statutory or civic holiday in the place where the Corporation has its head office;
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(D) |
“Fixed Rate Calculation Date” means, for any Subsequent Fixed Rate Period, the 30th day prior to the first day of such Subsequent Fixed Rate Period;
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(E) |
“Government of Canada Yield” on any date means
the
yield to maturity on such date (assuming semi-annual compounding) of a Canadian dollar denominated non-callable Government of Canada bond with a term to maturity of five years as quoted as of 10:00 a.m. (Toronto time) on such date and which appears on the Bloomberg Screen GCAN5YR Page on such date; provided that, if such rate does not appear on the Bloomberg Screen GCAN5YR Page on such date, the Government of Canada Yield will mean the average of the yields determined by two registered Canadian investment dealers selected by the Corporation, as being the yield to maturity on such date (assuming semi-annual compounding) which a Canadian dollar denominated non-callable Government of Canada bond would carry if issued in Canadian dollars at 100% of its principal amount on such date with a term to maturity of five years;
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(F) |
“in priority to”, “on a parity with” and “junior to” have reference to the order of priority in payment of dividends and in the distribution of assets in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, or other distribution of the assets of the Corporation among its shareholders for the purpose of winding-up its affairs;
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(G) |
“Initial Fixed Rate Period” means the period from and including the date of the initial issue of the Series D Shares to, but excluding, March 31, 2019;
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(H) |
“Quarter End Date” has the meaning given to it in subsection IV.1(a)(i);
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(I) |
“ranking as to capital” and similar expressions mean ranking with respect to priority in the distribution of assets of the Corporation in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, upon a return of capital or upon any other distribution of the assets of the Corporation among its shareholders for the purpose of winding-up its affairs;
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(J) |
“ranking as to dividends” and similar expressions mean ranking with respect to priority in the payment of dividends by the Corporation;
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(K) |
“Series D Conversion Date” means March 31, 2019 and March 31 (or, if such date is not a Business Day, the immediately following Business Day) of every fifth year thereafter;
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(L) |
“Series D Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series D Shares;
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(M) |
“Series E Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series E Shares;
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(N) |
“Subsequent Fixed Rate Period” means for the initial Subsequent Fixed Rate Period, the period from and including March 31, 2019 to, but excluding, March 31, 2024 and for each succeeding Subsequent Fixed Rate Period, the period commencing on the day immediately following the end of the immediately preceding Subsequent Fixed Rate Period to, but excluding, March 31 in the fifth year thereafter; and
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(O) |
“Transfer Agent” means CIBC Mellon Trust Company at its principal transfer office in Toronto, Ontario, its successors and assigns, or such other person as from time to time may be appointed as the registrar and transfer agent for the Series D Shares.
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(g) |
Modification
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(h) |
Approval of Holders of Series D Shares
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(i) |
Approval of Holders of Series D Shares
.
Except as otherwise provided herein, any approval of the holders of the Series D Shares with respect to any matters requiring the consent of such holders may be given in such manner as may then be required by law, subject to a minimum requirement that such approval be given by a resolution signed by all such holders or passed by the affirmative vote of at least two-thirds of the votes cast by the holders who voted in respect of that resolution at a meeting of the holders duly called for that purpose and at which the holders of 10% of the outstanding Series D Shares are present in person or represented by proxy. If at any such meeting the holder(s) of 10% of the outstanding Series D Shares are not present in person or represented by proxy within one-half hour after the time appointed for such meeting, then the meeting shall be adjourned to such date not less than 15 days thereafter and to such time and place as may be designated by the chairman of such meeting, and not less than 10 days’ written notice shall be given of such adjourned meeting. At such adjourned meeting the holders(s) of Series D Shares present in person or represented by proxy shall form the necessary quorum and may transact the business for which the meeting was originally called and a resolution passed thereat by the affirmative vote of at least two-thirds of the votes cast at such meeting shall constitute the approval of the holders of the Series D Shares. At any meeting of holders of Series D Shares as a series, each such holder shall be entitled to one vote in respect of each share held.
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(ii) |
Formalities, etc
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The proxy rules applicable to, the formalities to be observed in respect of the giving notice of, and the formalities to be observed in respect of the conduct of, any meeting or any adjourned meeting of holders of the Series D Shares shall be those required by law, as may from time to time be supplemented by the by-laws of the Corporation. On every poll taken at every meeting of holders of Series D Shares as a series, each holder entitled to vote thereat shall have one vote in respect of each Series D Share held.
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(i) |
Rights on Liquidation
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(j) |
Withholding Taxes
|
(i) |
Withholdinq Taxes
.
For greater certainty, and notwithstanding any other provision of this Section IV.1, the Corporation shall be entitled to deduct and withhold any amounts required to be deducted or withheld on account of any taxes from any amounts (including shares) payable or otherwise deliverable in respect of the Series D Shares, including on the redemption, cancellation or conversion of the Series D Shares. To the extent that any amounts are deducted or withheld, such deducted or withheld amounts shall be treated for all purposes hereof as having been paid or delivered to the person in respect of which such deduction or withholding was made. The Corporation is hereby authorized to sell or otherwise dispose of all or any number of Series
E
Shares otherwise deliverable to a holder of Series D Shares on the conversion of such Series D Shares in order to meet any applicable tax deduction or withholding tax requirements.
|
(ii) |
Transfer Taxes
.
For greater certainty, and notwithstanding any other provision of this Section IV.1, the Corporation shall not be required to pay any tax which may be:
|
(A) |
imposed upon the person or persons to whom Series E Shares are issued,
|
(B) |
payable in respect of the issuance of such Series E Shares or a certificate
therefor, or
|
(C) |
payable in respect of any transfer involved in the issuance and delivery of any certificate in the name or names other than that of the holder of the Series D Shares,
|
V.1 |
CUMULATIVE FLOATING RATE PREFERRED SHARES, SERIES E
|
(a) |
Dividends
|
|
(i) |
Dividend Payment Dates
.
The dividend payment dates (the “Dividend Payment Dates”) in respect of the dividends payable on the Series E Shares shall be the last day (or if such day is not a Business Day, the immediately following Business Day) of each of the months of March, June, September and December in each year.
|
(ii) |
Payment of Dividends
.
The holders of Series E Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the board of directors of the Corporation (the “Board”), out of moneys of the Corporation properly applicable to the payment of dividends, quarterly floating rate, cumulative, preferential cash dividends in respect of each Quarterly Floating Rate Period in an amount per Series E Share determined by multiplying the applicable Floating Quarterly Dividend Rate by $25.00 (“Quarterly Dividends”).
|
(iii) |
Dividend for Other than a Full Quarterly Floating Rate Period
.
The holders of Series E Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the Board out of moneys of the Corporation properly applicable to the payment of dividends, cumulative, preferential cash dividends for any period which is less than a full Quarterly Floating Rate Period, in an amount per share with respect to any Series E Share:
|
(A) |
which is issued, redeemed or converted during any Quarterly Floating Rate
Period;
|
(B) |
where the assets of the Corporation are distributed to the holders of the
Series
E
Shares pursuant to subsection V.1 (i) with an effective date during any Quarterly Floating Rate Period; or
|
(C) |
in any other circumstance where the number of days in a Quarterly Floating Rate Period that such share has been outstanding is less than a full Quarterly Floating Rate Period;
|
(iv)
|
Payment Procedure
.
The Corporation shall pay the dividends declared on the Series E Shares on the relevant Dividend Payment Date (less any tax required to be deducted or withheld by the Corporation) by electronic funds transfer or by cheque(s) drawn on a Canadian chartered bank or trust company and payable in lawful money of Canada at any branch of such bank or trust company in Canada or in such other manner, not contrary to applicable law, as the Corporation shall reasonably determine. The delivery or mailing of any cheque to a holder of Series E Shares (in the manner provided for in subsection V.1(f)(i)) or the electronic transfer of funds to an account specified by such holder shall be a full and complete discharge of the Corporation’s obligation to pay the dividends to such holder to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation from the related dividends as aforesaid and remitted to the proper taxing authority), unless such cheque is not honoured when presented for payment. Subject to applicable law, dividends which are represented by a cheque which has not been presented to the Corporation’s banker for payment or that otherwise remain unclaimed for a period of six years from the date on which they were declared to be payable may be reclaimed and used by the Corporation for its own purposes.
|
(v) |
Cumulative Payment of Dividends
.
If on any Dividend Payment Date, the Quarterly
Dividends payable in respect of the Dividend Period ending in the calendar month in which such Dividend Payment Date occurs are not paid in full on all of the Series E Shares then outstanding, such Quarterly Dividends, or the unpaid part thereof, shall be paid (less any tax required to be deducted or withheld by the Corporation) on a subsequent date or dates determined by the Board on which the Corporation shall have sufficient monies properly applicable to the payment of such Quarterly Dividends. The holder of Series
E
Shares shall not be entitled to any dividends other than or in excess of the cumulative preferential cash dividends herein provided for.
|
(vi)
|
Priority
.
The Series E Shares rank senior to the Common Shares and rank on a
parity with every other series of Preferred Shares as to dividends.
|
(b) |
Redemption, Conversion and Purchase
|
(i) |
General
.
To the extent permitted by applicable law, the Series
E
Shares may be redeemed, converted or purchased by the Corporation as provided in this subsection V.1(b) but not otherwise.
|
(ii) |
Corporation’s Redemption Rights
.
The Series E Shares shall not be redeemable by the Corporation on or prior to March 31, 2019. On any Series E Conversion Date, the Corporation may redeem all or any number of the outstanding Series E Shares, at its option, by the payment in cash of $25.00 per share so redeemed together with all accrued and unpaid dividends thereon to, but excluding, the date fixed for redemption (less any tax required to be deducted or withheld by the Corporation) (the “Conversion Date Redemption Price”).
|
(iii) |
Notice of Redemption
.
Notice of any redemption of Series E Shares pursuant to subsection V.1(b)(ii) shall be given to each holder of Series
E
Shares to be redeemed by the Corporation at least 30 and not more than 60 days prior to the date fixed for redemption. Any notice of redemption of Series E Shares by the Corporation shall be validly and effectively given on the date on which it is sent to each holder of Series
E
Shares to be redeemed in the manner provided for in subsection V.1(f)(i). Such notice shall set out:
|
(A) |
the date (the “Redemption Date”) on which the redemption is to take place;
|
(B) |
unless all the Series E Shares held by the holder to whom it is addressed are to be redeemed, the number of Series E Shares so held which are to be redeemed; and
|
(C) |
the Conversion Date Redemption Price or the Non-Conversion Date
Redemption Price, as applicable (such applicable redemption price referred to hereinafter as the “Redemption Price”).
|
(iv) |
Payment of Redemption Price
.
The Corporation shall on the Redemption Date pay or cause to be paid to the holders of the Series E Shares so called for redemption the Redemption Price therefor on presentation and delivery at the principal transfer office of the Transfer Agent in the city of Toronto or such other place or places in Canada designated in the notice of redemption, of the certificate or certificates representing the Series E Shares so called for redemption. Such payment shall be made by electronic funds transfer to an account specified by such holder or by cheque drawn on a Canadian chartered bank or trust company in the amount of the Redemption Price and such electronic transfer of funds or the delivery or mailing of such cheque (in the manner provided for in subsection V.1(f)(i)) shall be a full and complete discharge of the Corporation’s obligation to pay the Redemption Price owed to the holders of Series E Shares so called for redemption to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation as aforesaid and remitted to the proper taxing authority) unless such cheque is not honoured when presented for payment. From and after the Redemption Date, the holders of Series E Shares called for redemption shall cease to be entitled to dividends or to exercise any of the rights of holders of Series E Shares in respect of such shares except the right to receive the Redemption Price, provided that if payment of such Redemption Price is not duly made in accordance with the provisions hereof, then the rights of such holders shall remain unimpaired. If less than all the Series E Shares represented by any certificate shall be redeemed, a new certificate for the balance shall be issued without cost to the holder. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
|
(v) |
Deposit of Redemption Price
.
The Corporation shall have the right, at any time
after mailing a notice of redemption, to deposit the aggregate Redemption Price for the Series E Shares thereby called for redemption, or such part thereof as at the time of deposit has not been claimed by the holders entitled thereto, in a special account with a Canadian chartered bank or trust company named in the notice of redemption in trust for the holders of such shares, and upon such deposit being made or upon the Redemption Date, whichever is the later, the Series E Shares in respect of which such deposit shall have been made shall be deemed to be redeemed on the Redemption Date and the rights of each holder thereof shall be limited to receiving, without interest, the holder’s proportionate part (after taking into account any amounts required to be deducted or withheld on account of tax in respect of such holder) of the Redemption Price so deposited upon presentation and surrender of the certificate or certificates representing the Series E Shares so redeemed. Any interest on any such deposit shall belong to the Corporation. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
|
(vi) |
Declaration of Dividends in Respect of Shares to be Redeemed
.
If a dividend is declared by the Board in respect of any Quarterly Floating Rate Period during which the Series E Shares are redeemed, notwithstanding the provisions of subsection V.1(a)(iv), no electronic funds transfer or cheque shall be made or issued in payment of such dividend; rather, the amount of such dividend declared shall be considered to be an accrued and unpaid dividend for purposes of subsection V.1(b)(ii).
|
(vii) |
Conversion at the Option of the Holder
.
Subject to second paragraph of subsection V.1(b)(viii), subsection V.1(b)(ix) and subsection V.1(b)(x), each holder of Series E Shares shall have the right, at its option, on any Series E Conversion Date, to convert all or any part of its Series E Shares registered in its name into Cumulative Rate Reset Preferred Shares, Series D (the “Series D Shares”) on the basis of one Series D Share for each Series E Share converted. Such right may be exercised by notice in writing (an “Election Notice”) given not earlier than the 30th day prior to and not later than 5:00 p.m. (Toronto time) on the 15th day preceding the applicable Series E Conversion Date during usual business hours at any principal transfer office of the Transfer Agent, or such other place or places designated by the Corporation. On any conversion of Series E Shares into Series D Shares, the certificates representing the Series D Shares resulting from the conversion of Series E Shares to which such holder is entitled shall be issued in the name of the holder of the Series E Shares converted or in such name or names as such holder may direct in writing; provided that such holder shall pay any applicable security transfer taxes. Any Election Notice shall be accompanied by (1) payment or evidence of payment of the tax (if any) payable; and (2) the certificate or certificates representing the Series E Shares in respect of which the holder thereof desires to convert into Series D Shares with the transfer form on the back thereof or other appropriate stock transfer power of attorney duly endorsed by the holder, or his or her attorney duly authorized in writing, in which Election Notice such holder may elect to convert part only of the Series E Shares represented by such certificate or certificates not theretofore called for redemption in which event the Corporation will issue and deliver or cause to be delivered to such holder, at the expense of the Corporation, a new certificate representing the Series E Shares represented by such certificate or certificates that have not been converted. Such conversion shall be deemed to have been made at 5:00 p.m. (Toronto time) on the Series E Conversion Date, so that the rights of the holder of such Series E Shares as the holder thereof shall cease at such time and the person or persons entitled to receive the Series D Shares upon such conversion will be treated for all purposes as having become the holder or holders of record of such Series D Shares at such time. An Election Notice is irrevocable once received by the Corporation. If the Corporation does not receive an Election Notice within the specified time, the Series E Shares shall be deemed not to have been converted (subject to subsection V.1(b)(ix)).
|
(viii) |
Notice of Conversion Date and Dividend Rates and Election Notice
.
The Corporation shall, at least 30 days and not more than 60 days prior to each Series E Conversion Date, provide notice in writing to the then registered holders of the Series E Shares of the Series E Conversion Date and a form of Election Notice as specified by the Corporation. On the 30th day prior to each Series E Conversion Date, the Corporation shall give notice in writing to the registered holders of the Series E Shares of the Floating Quarterly Dividend Rate for the next Quarterly Floating Rate Period and the Annual Fixed Dividend Rate applicable to the Series D Shares for the next Subsequent Fixed Rate Period (as such terms are defined in the Series D Share Provisions).
|
(ix) |
Automatic Conversion
.
If the Corporation determines that there would remain outstanding
on a Series
E
Conversion
Date less than 1,000,000 Series E Shares, after having taken into account all Election Notices in respect of Series E Shares duly tendered for conversion into Series D Shares and all Election Notices in respect of Series D Shares duly tendered for conversion into Series E Shares in accordance with the Series D Share Provisions, in each case received by the Corporation during the time fixed therefor then, all, but not part, of the remaining outstanding Series E Shares will automatically be converted into Series D Shares on the basis of one Series D Share for each Series E Share on the applicable Series E Conversion Date. The Corporation shall give notice in writing of the automatic conversion thereof to all holders of the Series E Shares at least seven days prior to the applicable Series E Conversion Date.
|
(x) |
Restrictions on Conversion
.
The holders of Series E Shares shall not be entitled to convert their shares into Series D Shares if the Corporation determines that there would remain outstanding on a Series E Conversion Date less than 1,000,000 Series D Shares after having taken into account all Election Notices in respect of Series E Shares duly tendered for conversion into Series D Shares and all Election Notices in respect of Series D Shares duly tendered for conversion into Series E Shares in accordance with the Series D Share Provisions, in each case received by the Corporation during the time fixed therefor. The Corporation shall give notice in writing of the inability to convert Series E Shares to all holders of the Series E Shares at least seven days prior to the applicable Series E Conversion Date.
|
(xi) |
Non-Residents
.
The Corporation is not required to (but may at its option) issue Series D Shares upon the conversion of Series E Shares into Series D Shares to any person whose address is in, or whom the Corporation or the Transfer Agent has reason to believe is a resident of, any jurisdiction outside Canada, to the extent that such issue would require the Corporation to take any action to comply with the securities laws or analogous laws of such jurisdiction.
|
(xii) |
Purchase for Cancellation
.
Subject to applicable laws, the Corporation may, at any time, purchase for cancellation (if obtainable), out of capital or otherwise, the whole or any part of the Series E Shares outstanding from time to time at any price by tender to all holders of record of Series E Shares or through the facilities of any stock exchange on which the Series E Shares are listed, or in any other manner, provided that in the case of a purchase in any other manner the price for such Series E Shares so purchased for cancellation shall not exceed the highest price offered for a board lot of the Series E Shares on any stock exchange on which such shares are listed on the date of purchase for cancellation, plus the costs of purchase. If upon any tender to holders of Series E Shares under the provisions of this subsection V.1(b)(xii), more shares are offered than the Corporation is prepared to purchase, the shares so offered will be purchased as nearly as may be pro rata (disregarding fractions) according to the number of Series E Shares so offered by each of the holders of Series E Shares who offered shares to such tender. From and after the date of purchase of any Series E Shares under the provisions of this subsection V.1(b)(xii), the shares so purchased shall be cancelled.
|
(xiii) |
Conversion — General
.
On the conversion of a Series E Share to a Series D Share pursuant to the terms of these Series E Share Provisions, each such Series E Share shall become an issued Series D Share and the number of unissued Series
E
Shares shall be increased by the number of Series
E
Shares that became Series D Shares.
|
(c) |
Voting Rights
|
(i) |
Voting Rights — General
.
Except as otherwise required by law or in the conditions attaching to the Preferred Shares as a class, the holders of Series E Shares shall not be entitled to receive notice of, attend at, or vote at any meeting of shareholders of the Corporation, unless and until the Corporation shall have failed to pay eight Quarterly Dividends on the Series E Shares in accordance with the terms hereof, whether or not consecutive and whether or not such dividends were declared and whether or not there are any monies of the Corporation properly applicable to the payment of such dividends.
|
(d) |
Issue Price
|
(e) |
Election Under the Income Tax Act
|
(f) |
Notice and Interpretation
|
(i) |
Notices
.
Any notice, cheque, invitation for tenders or other communication from the Corporation herein provided for shall be sufficiently given, sent or made if delivered or if sent by first class unregistered mail, postage prepaid, to the holders of the Series E Shares at their respective addresses appearing on the records of the Corporation maintained by the Corporation or the Transfer Agent, or, in the case of joint holders, to the address of the holder whose name appears first on the records of the Corporation maintained by the Corporation or the Transfer Agent as one of such joint holders, or, in the event of the address of any of such holders not so appearing, then at the last address of such holder known to the Corporation. Accidental failure to give such notice, invitation for tenders or other communication to one or more holders of the Series E Shares shall not affect the validity of the notices, invitations for tenders or other communications properly given or any action taken pursuant to such notice, invitation for tender or other communication but, upon such failure being discovered, the notice, invitation for tenders or other communication, as the case may be, shall be sent forthwith to such holder or holders.
|
(A) |
give such notice by publication thereof once in a newspaper having national circulation in Canada or, if there is no newspaper having national circulation in Canada, in an English language newspaper of general circulation published in each of Vancouver, Calgary, Toronto and Montréal and such notice shall be deemed to have been validly given on the day next succeeding its publication; and
|
(B) |
fulfill the requirement to send such cheque or such share certificate by arranging for the delivery thereof to such holder by the Transfer Agent at its principal offices in the city of Toronto, and such cheque and/or share certificate shall be deemed to have been sent on the date on which notice of such arrangement shall have been given as provided in (A) above, provided that as soon as the Board determines that mail service is no longer interrupted or threatened to be interrupted, such cheque or share certificate, if not theretofore delivered to such holder, shall be sent by mail as herein provided.
|
(ii) |
Interpretation
.
If any day on which any dividend on the Series E Shares is payable, on which any Redemption Date or any Series E Conversion Date shall occur, or on or by which any other action is required or permitted to be taken hereunder is not a Business Day, then such dividend shall be payable, such Redemption Date or Series E Conversion Date shall occur or such other action shall be required or permitted to be taken on the immediately following day that is a Business Day.
|
(A) |
“Business Day” means a day other than a Saturday, a Sunday or any other day that is a statutory or civic holiday in the place where the Corporation has its head office;
|
(B) |
“Floating Quarterly Dividend Rate” means, for any Quarterly Floating Rate
Period, the rate (expressed as a percentage rounded to the nearest one hundred-thousandth of one percent (with 0.000005%) being rounded up)) equal to the sum of the T-Bill Rate on the applicable Floating Rate Calculation Date plus 3.28% per annum (calculated on the basis of the actual number of days elapsed in such Quarterly Floating Rate Period divided by 365);
|
(C) |
“Floating Rate Calculation Date” means for any Quarterly Floating Rate Period, the 30th day prior to the first day of such Quarterly Floating Rate Period;
|
(D) |
“in priority to”, “on a parity with” and “junior to” have reference to the order of priority in payment of dividends and in the distribution of assets in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, or other distribution of the assets of the Corporation among its shareholders for the purpose of winding-up its affairs;
|
(E) |
“Quarterly Commencement Date” means the last day of each of March, June, September and December in each year, commencing on March 31, 2019;
|
(F) |
“Quarterly Floating Rate Period” means the period from and including the day
immediately following the end of the immediately preceding Quarterly Floating Rate Period to, but excluding, the next succeeding Quarterly Commencement Date;
|
(G) |
“ranking as to capital” and similar expressions mean ranking with respect to priority in the distribution of assets of the Corporation in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, upon a return of capital or upon any other distribution of the assets of the Corporation among its shareholders for the purpose of winding-up its affairs;
|
(H) |
“ranking as to dividends” and similar expressions mean ranking with respect to priority in the payment of dividends by the Corporation;
|
(i) |
“Series D Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series D Shares;
|
(J) |
“Series
E
Conversion Date” means March 31, 2024 and March 31 (or, if such date is not a Business Day, the immediately following Business Day) of every fifth year thereafter;
|
(K) |
“Series E Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series E Shares;
|
(L) |
“T-Bill Rate” means, for any Quarterly Floating Rate Period, the average yield expressed as a percentage per annum on 90-day Government of Canada Treasury Bills, using the 3-month average results, as reported by the Bank of Canada, for the most recent treasury bills auction preceding the applicable Floating Rate Calculation Date (with auction results being posted on Reuters page BOCBILL or such other page as may replace such page on that service or if such service is no longer available, a successor service as determined by the Corporation); and
|
(M) |
“Transfer Agent” means CIBC Mellon Trust Company at its principal transfer office in Toronto, Ontario, its successors and assigns, or such other person as from time to time may be appointed as the registrar and transfer agent for the Series E Shares.
|
(g) |
Modification
|
(h) |
Approval of Holders of Series E Shares
|
(i) |
Approval of Holders of Series E Shares
.
Except as otherwise provided herein, any approval of the holders of the Series E Shares with respect to any matters requiring the consent of such holders may be given in such manner as may then be required by law, subject to a minimum requirement that such approval be given by a resolution signed by all such holders or passed by the affirmative vote of at least two-thirds of the votes cast by the holders who voted in respect of that resolution at a meeting of the holders duly called for that purpose and at which the holders of 10% of the outstanding Series E Shares are present in person or represented by proxy. If at any such meeting the holder(s) of 10% of the outstanding Series E Shares are not present in person or represented by proxy within one-half hour after the time appointed for such meeting, then the meeting shall be adjourned to such date not less than 15 days thereafter and to such time and place as may be designated by the chairman of such meeting, and not less than 10 days’ written notice shall be given of such adjourned meeting. At such adjourned meeting the holders(s) of Series E Shares present in person or represented by proxy shall form the necessary quorum and may transact the business for which the meeting was originally called and a resolution passed thereat by the affirmative vote of at least two-thirds of the votes cast at such meeting shall constitute the approval of the holders of the Series E Shares. At any meeting of holders of Series E Shares as a series, each such holder shall be entitled to one vote in respect of each share held.
|
(ii) |
Formalities, etc
.
The proxy rules applicable to, the formalities to be observed in respect of the giving notice of, and the formalities to be observed in respect of the conduct of, any meeting or any adjourned meeting of holders of the Series E Shares shall be those required by law, as may from time to time be supplemented by the by-laws of the Corporation. On every poll taken at every meeting of holders of Series E Shares as a series, each holder entitled to vote thereat shall have one vote in respect of each Series E Share held.
|
(i) |
Rights on Liquidation
|
(i) |
Withholding Taxes
|
(i) |
Withholding Taxes
.
For greater certainty, and notwithstanding any other provision of this Section V.1, the Corporation shall be entitled to deduct and withhold any amounts required to be deducted or withheld on account of any taxes from any amounts (including shares) payable or otherwise deliverable in respect of the Series E Shares, including on the redemption, cancellation or conversion of the Series E Shares. To the extent that any amounts are deducted or withheld, such deducted or withheld amounts shall be treated for all purposes hereof as having been paid or delivered to the person in respect of which such deduction or withholding was made. The Corporation is hereby authorized to sell or otherwise dispose of all or any number of Series D Shares otherwise deliverable to a holder of Series E Shares on the conversion of such Series E Shares in order to meet any tax deduction or withholding tax requirements.
|
(ii) |
Transfer Taxes
.
For greater certainty, and notwithstanding any other provision of this Section V.1, the Corporation shall not be required to pay any tax which may be:
|
(A) |
imposed upon the person or persons to whom Series D Shares are issued,
|
(B) |
payable in respect of the issuance of such Series D Shares or a certificate therefor, or
|
(C) |
payable in respect of any transfer involved in the issuance and delivery of any certificate in the name or names other than that of the holder of the Series
E
Shares,
|
III.1 |
The rights, privileges, restrictions and conditions attaching to the Series C Shares are as follows:
|
(a) |
Voting Rights
- Subject to the Canada Business Corporations Act (the
“Act”),
the holders of the Series C Shares shall not, as such, be entitled to receive notice of or to attend any meeting of the shareholders of the Corporation or to vote at any such meeting.
|
(b) |
Dividends
- Subject to the Act, the holders of the Series C Shares shall in each financial year of the Corporation in the discretion of the directors, but always in preference and priority to any payment of dividends on the Common Shares, be entitled to cumulative dividends at the rate of 1% per share of the amounts set out in the table below, payable in four (4) equal quarterly installments on April 1, July 1, October 1 and January 1 (of the following year) in each year, except in 2031, in which case the dividend will be payable in two (2) equal quarterly installments on April 1 and June 19, 2031, and no dividends shall be paid or set apart for payment upon the Common Shares and the shares of any other class ranking junior to the Preferred Shares unless all cumulative dividends on the Series C Shares shall have been declared and paid or set aside for payment. Dividend payments will be made to the holder of record of the Series C Shares of record on the last day of each calendar quarter, except for the last dividend payment which shall be made to the holder of record on June 19, 2031. The holders of the Series C Shares shall not be entitled to any dividends other than as provided for herein. Dividends shall accrue on the Series C Shares from the date of issue unless the directors shall otherwise determine. The Series C Shares rank senior to the Common Shares and rank on a parity with every other series of Preferred Shares as to dividends.
|
2012
|
na
|
$539,211
|
116.50
|
119.90
|
1.03
|
$138,737
|
$138,737
|
$138,737
|
$138,737
|
|||||||||
2013
|
2.0% |
$787,133
|
116.50
|
122.30
|
1.05
|
$206,577
|
$206,577
|
$206,577
|
$206,577
|
|||||||||
2014
|
2.0% |
$1,038.559
|
116.50
|
124.74
|
1.07
|
$278,013
|
$278,013
|
$278,013
|
$278,013
|
|||||||||
2015
|
2.0% |
$989,327
|
116.50
|
127.24
|
1.09
|
$270,130
|
$270,130
|
$270,130
|
$270,130
|
|||||||||
2016
|
2.0% |
$852,805
|
116.50
|
129.78
|
1.11
|
$237,511
|
$237,511
|
$237,511
|
$237,511
|
|||||||||
2017
|
2.0% |
$792,240
|
116.50
|
132.38
|
1.14
|
$225,056
|
$225,056
|
$225,056
|
$225,056
|
|||||||||
2018
|
2.0% |
$977,500
|
116.50
|
135.03
|
1.16
|
$283,238
|
$283,238
|
$283,238
|
$283,238
|
|||||||||
2019
|
2.0% |
$1,136,965
|
116.50
|
137.73
|
1.18
|
$336,033
|
$336,033
|
$336,033
|
$336,033
|
|||||||||
2020
|
2.0% |
$1,127,510
|
116.50
|
140.48
|
1.21
|
$339,903
|
$339,903
|
$339,903
|
$339,903
|
|||||||||
2021
|
2.0% |
$1,124,554
|
116.50
|
143.29
|
1.23
|
$345,792
|
$345,792
|
$345,792
|
$345,792
|
|||||||||
2022
|
2.0% |
$1,126,178
|
116.50
|
146.16
|
1.25
|
$353,217
|
$353,217
|
$353,217
|
$353,217
|
|||||||||
2023
|
2.0% |
$1,333,509
|
116.50
|
149.08
|
1.28
|
$426,610
|
$426,610
|
$426,610
|
$426,610
|
|||||||||
2024
|
2.0% |
$1,517,605
|
116.50
|
152.06
|
1.31
|
$495,215
|
$495,215
|
$495,215
|
$495,215
|
|||||||||
2025
|
2.0% |
$1,505,774
|
116.50
|
155.10
|
1.33
|
$501,182
|
$501,182
|
$501,182
|
$501,182
|
|||||||||
2026
|
2.0% |
$1,332,566
|
116.50
|
158.21
|
1.36
|
$452,402
|
$452,402
|
$452,402
|
$452,402
|
|||||||||
2027
|
2.0% |
$1,254,096
|
116.50
|
161.37
|
1.39
|
$434,277
|
$434,277
|
$434,277
|
$434,277
|
|||||||||
2028
|
2.0% |
$1,269,734
|
116.50
|
164.60
|
1.41
|
$448,486
|
$448,486
|
$448,486
|
$448,486
|
|||||||||
2029
|
2.0% |
$1,285,793
|
116.50
|
167.89
|
1.44
|
$463,241
|
$463,241
|
$463,241
|
$463,241
|
|||||||||
2030
|
2.0% |
$1,302,098
|
116.50
|
171.25
|
1.47
|
$478,498
|
$478,498
|
$478,498
|
$478,498
|
|||||||||
2031
|
2.0% |
$575,900
|
116.50
|
174.67
|
1.50
|
$431,731
|
$431,731
|
na
|
na
|
(c) |
Distribution Rights
- In the event of the liquidation, dissolution or winding-up of the Corporation or other distribution of assets of the Corporation among its shareholders for the purpose of winding-up its affairs, whether voluntary or involuntary, subject to the prior satisfaction of the claims of all creditors of the Corporation and of holders of shares of the Corporation ranking prior to the Series C Shares, the holders of the Series C Shares shall rank (a) on a parity with the Preferred Shares of every other series and (b) senior to the Common Shares and the shares of any other class ranking junior to the Preferred Shares. The Series C Shares shall be entitled to receive an amount equal to the redemption price plus any accrued and unpaid dividends thereon up to, but excluding, the redemption date. The redemption price for the purposes of this Section III.1(c) shall be equal to the sum of: (a) the face value of each Series C Share, being $53,400 and (b) the net present value of future dividends on the Series C Shares calculated using a discount rate equal to the yield on: (i) 10 year Government of Canada Bonds; or (ii) if the remaining term of the Series C Shares is less than 10 years, the yield on the Government of Canada Bonds closest in maturity to the remaining term of the Series C Shares, in each case, plus 50 bps. The net present value of the future dividends will be calculated by an independent national or international firm of chartered accountants, acceptable to a majority in number of the holders of Series C Shares, acting reasonably, using the table set out in Section III.1(b) above for the amount of the base dividends per annum adjusted for inflation using assumptions considered reasonable by such firm of chartered accountants and applying the appropriate discount rate as set out above, The Corporation shall send a written notice to the holders of Class C Shares of its proposal of a firm of chartered accountants to make the determination and the holders will have ten calendar days thereafter to notify the Corporation of their acceptance or rejection of such firm and the failure by a holder to provide such notice shall be deemed to be acceptance of such firm and if a majority of the holders accept such firm, it shall be deemed to be accepted by all such holders. The cost of preparing such calculation shall be borne by the Corporation. The foregoing amount shall be paid before any amount is paid or any assets of the Corporation are distributed to the holders of any shares of the Corporation ranking junior as to capital to the Series C Shares. Upon payment to the holders of the Series C Shares of the amounts so payable to them, such holders shall not be entitled to share in any further distribution of the assets of the Corporation.
|
(i) |
General.
In the event that the Corporation is a party to a transaction which results in the Common Shares or securities issued in exchange for such Common Shares not being listed on the Toronto Stock Exchange, TSX Venture Exchange, New York Stock Exchange, American Stock Exchange, NASDAQ or London Stock Exchange, subject to the Act, the holder shall have the option to require the Corporation to redeem all but not less than all of the issued Series C Shares registered in the name of such holder on the books of the Corporation, at the redemption price plus any accrued and unpaid dividends thereon up to, but excluding, the redemption date. The redemption price for the purposes of this Section
III.1(d)
shall be equal to the sum of (a) the face value of each Series C Share, being $53,400 and (b) the net present value of future dividends on the Series C Shares calculated using a discount rate equal to the yield on: (i) the 10 year Government of Canada Bonds; or (ii) if the remaining term of the Series C Shares is less than 10 years, the yield on the Government of Canada Bonds closest in maturity to the remaining term of the Series C Shares, in each case, plus 200 basis points (“bps”). The net present value of the future dividends will be calculated by an independent national or international firm of chartered accountants acceptable to a majority in number of the holders of Series C Shares, acting reasonably, using the table set out in Section III.1(b) above for the amount of the base dividends per annum adjusted for inflation using assumptions considered reasonable by such firm of chartered accountants and applying the appropriate discount rate as set out above. The Corporation shall send a written notice to the holders of Class C Shares of its proposal of a firm of chartered accountants to make the determination and the holders will have ten calendar days thereafter to notify the Corporation of their acceptance or rejection of such firm and the failure by a holder to provide such notice shall be deemed to be acceptance of such firm and if a majority of the holders accept such firm, it shall be deemed to be accepted by all such holders. The cost of preparing such calculation shall be borne equally by the Corporation and the holders of Series C Shares whose shares are being redeemed.
|
(ii) |
Transaction Notice.
The Corporation shall give not less than thirty (30) days’ prior notice in writing of a transaction which will give rise to the redemption option set forth in Section III.1(d)(i) by mailing to each person who at the date of mailing is a registered holder of Series C Shares. Such notice shall be mailed in a prepaid envelope addressed to each such shareholder at such shareholder’s address as it appears on the books of the Corporation or, in the event of the address of any such shareholder not so appearing, then to the last known address of such shareholder, provided however, that accidental failure or omission to give any such notice to one or more of such holders shall not affect the validity of such transaction. Such notice shall set out the anticipated closing date of the transaction which date shall also be deemed to be the date of redemption (the “redemption date”), details of the proposed transaction giving rise to the notice, the anticipated redemption price of the shares and the date on which redemption will take place if so elected by the holder. Furthermore the Corporation shall respond to such requests for additional information from the holder regarding the transaction as the holder reasonably requests in order to make its decision regarding whether it will exercise its redemption right.
|
(iii) |
Redemption Notice.
A holder of such Series C Shares that would like to exercise its right to redemption shall tender to the Corporation at its registered office a request in writing (“redemption notice”) specifying (A) that such holder desires to have all of the Series C Shares registered in the name of such holder redeemed by the Corporation (B) the share certificates, if any, representing the Series C Shares which the registered holder desires to have the Corporation redeem (C) the address to which such payment is to be delivered, provided that if the holder does not indicate an address, the Corporation shall make the payment to such shareholder at such shareholder’s address as it appears on the books of the Corporation or, in the event of the address of any such shareholder not so appearing, then to the last known address of such shareholder and
(D)
the business day, which shall be not less than 30 days after the day on which the request in writing is given to the Corporation, on which the holder desires to have the Corporation redeem such shares (the
“redemption date”).
|
(iv) |
Redemption Procedure.
On the redemption date, the Corporation shall pay or cause to be paid to or to the order of the registered holders of the shares to be redeemed the applicable redemption price plus any accrued and unpaid dividends thereon up to, but excluding, the redemption date on presentation and surrender, at the registered office of the Corporation or any other place designated in such notice, of the certificates representing the shares so called for redemption. Such payment shall be made by cheque payable at any branch in Canada of a chartered bank or trust company selected by the Corporation.
|
(v) |
Cessation of Rights.
From and after the redemption date, the Series C Shares so redeemed shall cease to be entitled to dividends and the holders thereof shall not be entitled to exercise any of the rights of shareholders in respect thereof, unless payment of the redemption price of the Series C Shares plus any accrued and unpaid dividends thereon up to, but excluding, the redemption date shall not be made upon presentation of the certificates in accordance with the foregoing provisions, in which case the rights of the holders shall remain unaffected.
|
|
(vi) |
Deposit of Redemption Price,
The Corporation shall have the right, at any time after receipt of the redemption notice, to deposit the redemption price of the Series C Shares to be redeemed or of such of the said shares represented by certificates which have not at the date of such deposit been surrendered by the holders thereof in connection with any such redemption plus any accrued and unpaid dividends thereon up to, but excluding, the redemption date, in a special account in any chartered bank or any trust company in Canada named in such notice to be paid without interest to or to the order of the respective holders of such shares called for redemption upon presentation and surrender to such bank or trust company of the certificates representing the same and, upon such deposit being made or upon the redemption date, whichever is the later, the Series C Shares in respect of which such deposit shall have been made shall be redeemed and the holders thereof after such deposit or such redemption date, as the case may be, shall be limited to receiving without interest their proportionate part of the total amount so deposited against presentation and surrender of the said certificates held by them respectively, and interest allowed on any such deposit shall belong to the Corporation.
|
(e) |
Redemption at Option of Holder in Event of Failure to Pay Dividends
|
(i) |
General.
Subject to the Act, a holder of any Series C Shares shall be entitled, at any time following the failure by the Corporation to declare and pay a dividend on any of the dates set forth herein and provided such dividend has not been declared and paid within seven calendar days of notice of a request for redemption being given, to require the Corporation to redeem all, but not less than all, of the Series C Shares registered in the name of such holder on the books of the Corporation. The redemption price for the purposes of this Section
III.1(e)
shall be equal to the sum of (a) the face value of each Series C Share, being $53,400 and (b) the net present value of future dividends on the Series C Shares calculated using a discount rate equal to the yield on: (i) 10 year Government of Canada Bonds; or (ii) if the remaining term of the Series C Shares is less than 10 years, the yield on the Government of Canada Bonds closest in maturity to the remaining term of the Series C Shares, in each case, plus 50 bps. The net present value of the future dividends will be calculated by an independent national or international firm of chartered accountants, acceptable to a majority in number of the holders of Series C Shares, acting reasonably, using the table set out in Section III.1(b) above for the amount of the base dividends per annum adjusted for inflation using assumptions considered reasonable by such firm of chartered accountants and applying the appropriate discount rate as set out above. The Corporation shall send a written notice to the holders of Class C Shares of its proposal of a firm of chartered accountants to make the determination and the holders will have ten calendar days thereafter to notify the Corporation of their acceptance or rejection of such firm and the failure by a holder to provide such notice shall be deemed to be acceptance of such firm and if a majority of the holders accept such firm, it shall be deemed to be accepted by all such holders. The cost of preparing such calculation shall be borne equally by the Corporation and the holders of Series C Shares whose shares are being redeemed.
|
(ii) |
Notice.
A holder of such shares to be redeemed shall tender to the Corporation at its registered office a request in writing specifying (A) that such holder desires to have all of the Series C Shares registered in the name of such holder redeemed by the Corporation (B) the business day, which shall be not less than 30 days after the day on which the request in writing is given to the Corporation, on which the holder desires to have the Corporation redeem such shares (the
“redemption date”),
together with the share certificates, if any, representing the Series C Shares which the registered holder desires to have the Corporation redeem and (C) the address to which such payment is to be delivered, provided that if the holder does not indicate an address, the Corporation shall make the payment to such shareholder at such shareholder’s address as it appears on the books of the Corporation or, in the event of the address of any such shareholder not so appearing, then to the last known address of such shareholder.
|
(iii) |
Redemption Procedure.
Upon receipt of such request and share certificates representing the Series C Shares, the Corporation shall, on the redemption date, redeem such shares by paying to such registered holder an amount equal to the redemption price plus any accrued and unpaid dividends thereon up to, but excluding, the redemption date. Such payment shall be made by cheque payable at any branch in Canada of one of the Corporation’s bankers for the time being.
|
(iv) |
Cessation of Rights.
The Series C Shares shall be redeemed on the redemption date and thereafter such shares shall cease to be entitled to dividends and the holders thereof shall not be entitled to exercise any of the rights of shareholders in respect thereof, unless payment of the redemption price plus any accrued and unpaid dividends on the Class C Shares up to, but excluding, the redemption date is not made on the redemption date, in which case the rights of the holders of such shares shall remain unaffected.
|
(f) |
Automatic Redemption
|
(i) |
General.
Unless the Corporation has delivered a conversion notice pursuant to Section III.1(g)(ii), subject to the Act, the Corporation shall redeem on June 19, 2031 all but not less than all of the issued Series C Shares, other than those Series C Shares for which a conversion notice has been delivered by the holder pursuant to Section III.1(g)(vi) hereof, on payment for each share to be redeemed of the redemption price of $53,400 plus any accrued and unpaid dividends thereon up to, and including, the redemption date.
|
(ii) |
Notice.
The Corporation shall give notice in writing of such redemption on or before May 20, 2031 by mailing to each person who at the date of mailing is a registered holder of the Series C Shares to be redeemed a redemption notice. Such notice shall be mailed in a prepaid envelope addressed to each such shareholder at such shareholder’s address as it appears on the books of the Corporation or, in the event of the address of any such shareholder not so appearing, then to the last known address of such shareholder, provided however, that accidental failure or omission to give any such notice to one or more of such holders shall not affect the validity of such redemption. Such notice shall set out the redemption price of the shares to be redeemed and the date on which redemption is to take place, being June 19, 2031.
|
(iii) |
Redemption Procedure.
On the date so specified for redemption in such notice, the Corporation shall pay or cause to be paid to or to the order of the registered holders of the shares to be redeemed in cash the redemption price of $53,400 per share plus any accrued and unpaid dividends thereon up to, and including, the redemption date on presentation and surrender, at the registered office of the Corporation or any other place designated in such notice, of the certificates representing the shares so called for redemption. Such payment shall be made by cheque payable at any branch in Canada of one of the Corporation’s bankers for the time being.
|
(iv) |
Cessation of Rights.
After June 19, 2031, the Series C Shares called for redemption shall cease to be entitled to dividends and the holders thereof shall not be entitled to exercise any of the rights of shareholders in respect thereof, unless payment of the redemption price of the Series C Shares plus any accrued and unpaid dividends thereon up to, and including, the redemption date shall not be made upon presentation of the certificates in accordance with the foregoing provisions, in which case the rights of the holders shall remain unaffected.
|
(v) |
Deposit of Redemption Price.
The Corporation shall have the right, at any time after the mailing of the redemption notice but in any event not before May 1, 2031, to deposit the redemption price of the Series C Shares so called for redemption or of such of the said shares represented by certificates which have not at the date of such deposit been surrendered by the holders thereof in connection with any such redemption plus any accrued and unpaid dividends thereon up to, and including, the redemption date in a special account in any chartered bank or any trust company in Canada named in such notice to be paid without interest to or to the order of the respective holders of such shares called for redemption upon presentation and surrender to such bank or trust company of the certificates representing the same and, upon such deposit being made or upon the date specified for redemption in such notice, whichever is the later, the Series C Shares in respect of which such deposit shall have been made shall be redeemed and the holders thereof after such deposit or such redemption date, as the case may be, shall be limited to receiving without interest their proportionate part of the total amount so deposited against presentation and surrender of the said certificates held by them respectively, and interest allowed on any such deposit shall belong to the Corporation.
|
(i) |
General.
Provided that the Common Shares are listed on the Toronto Stock Exchange, TSX Venture Exchange, New York Stock Exchange, American Stock Exchange, NASDAQ or London Stock Exchange, subject to Regulatory Approval, a holder of any Series C Shares shall be entitled, at any time after May 20, 2031 and before June 19, 2031, to convert all, but not less than all of the Series C Shares registered in the name of such holder on the books of the Corporation into Common Shares. The conversion price for the purposes of this Section III.1(g) shall be equal to the face value of each Series C Share, being $53,400 (the “
Conversion Price
”)
.
Provided that the Common Shares are listed on the Toronto Stock Exchange, TSX Venture Exchange, New York Stock Exchange, American Stock Exchange, NASDAQ or London Stock Exchange, the Corporation shall be entitled to convert all but not less than all of the Series C Shares for which no redemption notice has been delivered before May 20, 2031 by delivering a conversion notice under Section III.1(g)(ii), in which case the Conversion Price shall equal the face value of each Series C Share, being $53,400.
|
(ii) |
Notice.
In the case of a conversion by a holder of Series C Shares, a holder of such shares to be converted shall tender to the Corporation at its registered office a request in writing specifying (A) that such holder desires to have all of the Series C Shares registered in the name of such holder converted by the Corporation into Common Shares (B) the business day, which shall be not less than 30 days after the day on which the request in writing is given to the Corporation, on which the holder desires to have the Corporation convert such shares (the
“conversion date”),
together with the share certificates, if any, representing the Series C Shares which the registered holder desires to have the Corporation convert and (C) the address to which such shares are to be delivered, provided that if the holder does not indicate an address, the Corporation shall deliver the shares to such shareholder at such shareholder’s address as it appears on the books of the Corporation or, in the event of the address of any such shareholder not so appearing, then to the last known address of such shareholder. In the case of a conversion by the Corporation, the Corporation shall give notice in writing of such conversion on May 20, 2031 by mailing to each person who at the date of mailing is a registered holder of Series C Shares to be converted a conversion notice. Such notice shall be mailed in a prepaid envelope addressed to each such shareholder at such shareholder’s address as it appears on the books of the Corporation or, in the event of the address of any such shareholder not so appearing, then to the last known address of such shareholder, provided however, that accidental failure or omission to give any such notice to one or more of such holders shall not affect the validity of such conversion. Such notice shall set out the Conversion Price of the shares to be converted and the date on which such conversion is to take place, being June 19, 2031.
|
(iii) |
Conversion Procedure.
In the case of a conversion by a holder of Series C Shares, upon receipt of such request and share certificates representing the Series C Shares, the Corporation shall, on the conversion date, convert such shares into Common Shares and pay the holder the amount of any accrued and unpaid dividends thereon up to, and including, the conversion date in cash. In the case of a conversion by the Corporation, the Corporation shall have the right, at any time after mailing of the conversion notice, to deposit the share certificates for Common Shares representing the Conversion Price of the Series C Shares to be converted plus a cheque in the amount of any accrued and unpaid dividends on such Series C Shares up to, and including, the conversion date in trust with a trust company in Canada named in such notice to be delivered and paid without interest to or to the order of the respective holders of such shares to be converted upon presentation and surrender to such trust company of the certificates representing the same and, upon such deposit being made or upon the date specified for conversion in such notice, whichever is later, the Series C Shares in respect of which such deposit shall have been made shall be converted into Common Shares and the holders thereof after such deposit or such conversion date, as the case may be, shall be limited to receiving without interest their proportion of the Common Shares and the total amount so deposited against presentation and surrender of the said certificates held by them respectively, and interest allowed on any such deposit shall belong to the Corporation. Subject to Regulatory Approval, such conversion shall be effected by delivery of share certificates for Common Shares in the amount determined as set out in Section III.1(g)(iv) below, provided that in the case of a fractional Common Share, such fractional Common Share shall be rounded to the nearest full share, together with a cheque payable at any branch in Canada of one of the Corporation’s bankers from time to time in respect of any accrued and unpaid dividends.
|
(iv) |
Number of Common Shares.
The number of Common Shares to be issued will be equal to the Conversion Price determined as at the conversion date multiplied by the number of Series C Shares held by such holder divided by the sixty (60) day volume weighted average price of the Common Shares on the TSX, provided that if the Common Shares are not then listed on the TSX, then on such stock exchange as may be selected by the board of directors of the Corporation.
|
(v) |
Cessation of Rights.
The Series C Shares shall be converted on the conversion date and thereafter such shares shall cease to be entitled to dividends and the holders thereof shall not be entitled to exercise any of the rights of shareholders in respect thereof, unless payment of the Conversion Price plus any accrued and unpaid dividends on the Class C Shares up to, and including, the conversion date is not made on the conversion date, in which case the rights of the holders of such shares shall remain unaffected.
|
(vi) |
If the Corporation provides a redemption notice to a holder of Series C Shares pursuant to Section III.1(f)(ii), the holder may provide a conversion notice to the Corporation pursuant to Section III.1(g)(ii) not less than 10 days prior to the applicable redemption date, in which case the conversion notice will take precedence over such redemption notice and such Series C Shares shall be converted into Common Shares in accordance with this Section III,1(g) on the date specified in the redemption notice.
|
(h) |
Regulatory Approval
– For purposes hereof, “Regulatory Approval” means the approval of any regulatory authority having jurisdiction in connection with the conversion of the Series C Shares referred to in Section III.1(g) pursuant to which holders of Series C Shares are to receive Common Shares, including the approval of the TSX if the Common Shares are, at the relevant time, listed on the TSX. The Corporation will use commercially reasonable efforts to obtain such Regulatory Approval in a timely manner.
|
(i) |
Anti Dilution
– The Conversion Price in effect at any date shall be subject to adjustment from time to time as follows:
|
(i) |
If and whenever at any time after April 15, 2031 and prior to June 19, 2031 the Corporation shall fix a record date for the issuance of options, rights or warrants to all or substantially all the holders of its outstanding Common Shares entitling them, for a period expiring not more than 45 days after such record date, to subscribe for or purchase Common Shares (or securities convertible or exchangeable into Common Shares) at a price per share (or having a conversion or exchange price per share) less than 95% of the Current Market Price of a Common Share on such record date, the Conversion Price shall be adjusted immediately after such record date so that it shall equal the price determined by multiplying the Conversion Price in effect on such record date by a fraction, of which the numerator shall be the total number of Common Shares outstanding on such record date plus the total number of additional Common Shares offered for subscription or purchase (or into which the convertible or exchangeable securities so offered are convertible or exchangeable) and of which the denominator shall be the total number of Common Shares outstanding on such record date plus a number of Common Shares equal to the number arrived at by dividing the aggregate price of the total number of additional Common Shares offered for subscription or purchase (or the aggregate conversion or exchange price of the convertible or exchangeable securities so offered) by such Current Market Price per Common Share. Such adjustment shall be made successively whenever such a record date is fixed. To the extent that any such options, rights or warrants are not so issued or any such options, rights or warrants are not exercised prior to the expiration thereof, the Conversion Price shall be re adjusted to the Conversion Price which would then be in effect if such record date had not been fixed or to the Conversion Price which would then be in effect based upon the number of Common Shares (or securities convertible or exchangeable into Common Shares) actually issued upon the exercise of such options, rights or warrants, as the case may be.
|
(ii) |
If and whenever at any time prior to June 19, 2031, there is a reclassification of the Common Shares or a capital reorganization of the Corporation (other than (i) a subdivision of the outstanding Common Shares into a greater number of shares, (ii) a reduction, combination or consolidation of the outstanding Common Shares into a smaller number of shares, or (iii) the issuance of Common Shares or securities convertible into or exchangeable for Common Shares to holders of substantially all of the outstanding Common Shares by way of dividend or distribution) or a consolidation, amalgamation, arrangement or merger of the Corporation with or into any other person or other entity; or a sale or conveyance of the property and assets of the Corporation as an entirety or substantially as an entirety to any other person or other entity or a liquidation, dissolution or winding up of the Corporation, any holder of Series C Shares who has not exercised its right of conversion prior to the effective date of such reclassification, capital reorganization, consolidation, amalgamation, arrangement or merger, sale or conveyance or liquidation, dissolution or winding-up, upon the exercise of such right thereafter, shall be entitled to receive and shall accept, in lieu of the number of Common Shares then sought to be acquired by it, the number of shares or other securities or property of the Corporation or of the person or other entity resulting from such merger, amalgamation, arrangement or consolidation, or to which such sale or conveyance may be made or which holders of Common Shares receive pursuant to such liquidation, dissolution or winding up, as the case may be, that such holder of Series C Shares would have been entitled to receive on such reclassification, capital reorganization, consolidation, amalgamation, arrangement or merger, sale or conveyance or liquidation, dissolution or winding-up, if, on the record date or the effective date thereof, as the case may be, the holder had been the registered holder of the number of Common Shares sought to be acquired by it and to which it was entitled to acquire upon the exercise of the conversion right. If determined appropriate by the board of directors of the Corporation to give effect to or to evidence the provisions of this Section III.1 (i)(ii), the Corporation, its successor, or such purchasing person or other entity as the case may be, shall, prior to or contemporaneously with any such reclassification, capital reorganization, consolidation, amalgamation, arrangement, merger, sale or conveyance or liquidation, dissolution or winding-up enter into an agreement which shall provide, to the extent possible, for the application of the provisions set forth herein with respect to the rights and interests thereafter of the holder of Class C Shares to the end that the provisions set forth herein shall thereafter correspondingly be made applicable, as nearly as may reasonably be practicable, with respect to any shares or other securities or property to which a holder of Class C Shares is entitled on the exercise of its conversion rights thereafter.
|
(iii) |
In any case in which this Section III.1(i) shall require that an adjustment shall become effective immediately after a record date for an event referred to herein, the Corporation may defer, until the occurrence of such event, issuing to the holder of Class C Shares converted after such record date and before the occurrence of such event the additional Common Shares issuable upon such conversion by reason of the adjustment required by such event before giving effect to such adjustment; provided, however, that the Corporation shall deliver to such holder of Class C Shares an appropriate instrument evidencing such holder’s right to receive such additional Common Shares upon the occurrence of the event requiring such adjustment and the right to receive any distributions made on such additional Common Shares declared in favour of holders of record of Common Shares on and after the conversion date or such later date as such holder would, but for the provisions of this Section III.1 (i)(iii) have become the holder of record of such additional Common Shares pursuant to this Section III.1(i).
|
(iv) |
The adjustments provided for in this Section III.1(i) are cumulative and shall apply to successive events resulting in any adjustment under the provisions of this Section, provided that, notwithstanding any other provision of this Section, no adjustment of the Conversion Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Price then in effect; provided however, that any adjustments which by reason of this Section III.1 (i)(iv) are not required to be made shall be carried forward and taken into account in any subsequent adjustment.
|
(v) |
For the purpose of calculating the number of Common Shares outstanding, Common Shares owned by or for the benefit of the Corporation shall not be counted.
|
(vi) |
In the event of any question arising with respect to the adjustments provided in this Section III.1(i), such question shall be conclusively determined by a firm of chartered accountants appointed by the Corporation and acceptable to a majority of the holders of Class C Shares (who may be the auditors of the Corporation); such accountants shall have access to all necessary records of the Corporation and such determination shall be binding upon the Corporation and the holders of Class C Shares. The Corporation shall send a written notice to the holders of Class C Shares of its proposal of a firm of chartered accountants to make the determination and the holders will have ten calendar days thereafter to notify the Corporation of their acceptance or rejection of such firm and the failure to provide such notice shall be deemed to be acceptance of such firm.
|
(vii) |
In case the Corporation shall take any action affecting the Common Shares other than an action described in this Section III.1(i), which in the opinion of the board of directors of the Corporation would materially adversely affect the rights of the holders of Class C Shares, the Conversion Price shall be adjusted in such manner and at such time, by action of the directors, subject to Regulatory Approval, as the board of directors of the Corporation in their sole discretion may determine to be equitable in the circumstances. Failure of the board of directors of the Corporation to make such an adjustment shall be conclusive evidence that the directors have determined that it is equitable to make no adjustment in the circumstances.
|
(viii) |
Subject to Regulatory Approval, no adjustment in the Conversion Price shall be made in respect of any event described in Section III.1(i)(ii) if the holders of Series C Shares are entitled to participate in such event on the same terms mutatis mutandis as if they had converted their Series C Shares prior to the effective date or record date, as the case may be, of such event.
|
(ix) |
Except as stated above in this Section III.1(i), no adjustment will be made in the Conversion Price for any Class C Shares as a result of the issuance of Common Shares at less than the Current Market Price during the period from April 15, 2031 to the conversion date.
|
(x) |
For purposes of this Section III.1(i), “Current Market Price” means the weighted average trading price of the Common Shares on the Toronto Stock Exchange for the 20 consecutive trading days ending on the fifth trading day preceding the date of the applicable event (or, if the Common Shares are not listed thereon, on such stock exchange on which the Common Shares are listed as may be selected for such purpose by the board of directors of the Corporation, or if the Common Shares are not listed on any stock exchange, then on the over-the-counter market). The weighted average price shall be determined by dividing the aggregate sale price of all Common Shares sold on the said exchange or market, as the case may be, during the said 20 consecutive trading days by the total number of Common Shares so sold during such period.
|
(j) |
Specified Amount
– For the purposes of subsection 191(4) of the Tax Act, the specified amount for each Series C Share is $238,830.
|
(a) |
Dividends
|
(i) |
Dividend Periods and Dividend Payment Dates
.
A “Dividend Period” means
the period from and including the date of initial issue of the Series A Shares to, but excluding, December
31, 2012 and,
thereafter,
the next succeeding period that is from and including the 31st day (each, a “Quarter End Date”) of each of the months of March, June, September and December in each year, as the case may be,
to
but excluding the next succeeding Quarter End Date. The dividend payment dates (the “Dividend Payment Dates”) in respect of the dividends payable on the Series A Shares shall be the last day (or, if such day is not a Business Day, the immediately following Business Day) of each of the months of March, June, September and December in each year.
|
(ii) |
Payment of Dividends
.
|
(A) |
During the Initial Fixed Rate Period and each Subsequent Fixed Rate Period, the holders of Series A Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the board of directors of the Corporation (the “Board”), out of moneys of the Corporation properly applicable to the payment of dividends, fixed, cumulative, preferential cash dividends (the “Quarterly Dividends”) in the amounts set forth in subsection I.1(a)(ii)(B) payable, with respect to each Dividend Period, on the Dividend Payment Date in respect of such Dividend Period.
|
(B) |
Subject to subsection I.1(a)(iii), for all Dividend Periods during:
|
(1) |
the Initial Fixed Rate Period, each Quarterly Dividend shall be in an amount equal to $0.28125 per Series A Share (being an annual rate equal to $1.1250 per Series A Share); and
|
(2) |
each Subsequent Fixed Rate Period, each Quarterly Dividend shall be in an amount per Series A Share equal to the result of the following calculation: 1/4 x [($25.00 x AFDR)], where “AFDR” means the Annual Fixed Dividend Rate applicable to such Subsequent Fixed Rate Period.
|
(C) |
The Corporation shall determine the Annual Fixed Dividend Rate for each Subsequent Fixed Rate Period on the relevant Fixed Rate Calculation Date. Such determination shall, in the absence of manifest error, be final and binding on the Corporation and all holders of Series A Shares. The Corporation shall, on the relevant Fixed Rate Calculation Date, give written notice of the Annual Fixed Dividend Rate for the ensuing Subsequent Fixed Rate Period to the registered holders of the then outstanding Series A Shares in accordance with the provisions of subsection I.1(f)(i).
|
(D) |
Dividends on the Series A Shares shall accrue daily from and including the date of issue of such shares.
|
(iii) |
Initial Dividend and Dividend for Other than a Full Dividend Period
.
The holders of Series A Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the Board out of moneys of the Corporation properly applicable to the payment of dividends, cumulative, preferential cash dividends for the initial period or any period which is less than a full Dividend Period, as follows:
|
(A) |
an initial dividend in respect of the period from and including the date of the initial issue of the Series A Shares to but excluding December 31, 2012 in an amount per Series A Share equal to $1.1250 multiplied by a fraction, the numerator of which is the number of calendar days from and including the date of the initial issue of the Series A Shares to but excluding December 31, 2012 and the denominator of which is 365, (which, if the Series A Shares are issued on November 9, 2012, shall be $0.1603 per Series A Share); and
|
(B) |
a dividend in an amount per share with respect to any Series A Share:
|
(1) |
which is issued, redeemed or converted during any Dividend Period;
|
(2) |
where the assets of the Corporation are distributed to the holders of the Series A Shares pursuant to subsection I.1(i) with an effective date during any Dividend Period; or
|
(3) |
in any other circumstance where the number of days in a Dividend Period that such share has been outstanding is less than a full Dividend Period (other than the period referred to in subsection I.1(a)(iii)(A)),
|
(iv) |
Payment Procedure
.
The Corporation shall pay the dividends declared on the Series A Shares on the relevant Dividend Payment Date (less any tax required to be deducted or withheld by the Corporation) by electronic funds transfer or by cheque(s) drawn on a Canadian chartered bank or trust company and payable in lawful money of Canada at any branch of such bank or trust company in Canada or in such other manner, not contrary to applicable law, as the Corporation shall reasonably determine. The delivery or mailing of any cheque to a holder of Series A Shares (in the manner provided for in subsection I.1(f)(i)) or the electronic transfer of funds to an account specified by such holder shall be a full and complete discharge of the Corporation’s obligation to pay the dividends to such holder to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation from the related dividends as aforesaid and remitted to the proper taxing authority), unless such cheque is not honoured when presented for payment. Subject to applicable law, dividends which are represented by a cheque which has not been presented to the Corporation’s banker for payment or that otherwise remain unclaimed for a period of six years from the date on which they were declared to be payable may be reclaimed and used by the Corporation for its own purposes.
|
(v) |
Cumulative Payment of Dividends
.
If on any Dividend Payment Date, the Quarterly Dividends payable in respect of the Dividend Period ending in the calendar month in which such Dividend Payment Date occurs are not paid in full on all of the Series A Shares then outstanding, such Quarterly Dividends, or the unpaid part thereof, shall be paid (less any tax required to be deducted or withheld by the Corporation) on a subsequent date or dates determined by the Board on which the Corporation shall have sufficient monies properly applicable to the payment of such Quarterly Dividends. The holder of Series A Shares shall not be entitled to any dividends other than or in excess of the cumulative preferential cash dividends herein provided for.
|
(vi) |
Priority
.
The Series A Shares rank senior to the Common Shares and rank on a parity with every other series of Preferred Shares as to dividends.
|
(b) |
Redemption, Conversion and Purchase
|
(i) |
General
.
To the extent permitted by applicable law, the Series A Shares may be redeemed, converted or purchased by the Corporation as provided in this subsection I.1 (b) but not otherwise.
|
(ii) |
Corporation’s Redemption Rights
.
The Series A Shares shall not be redeemable by the Corporation prior to December 31, 2018. On any Series A Conversion Date, the Corporation may redeem all or any number of the outstanding Series A Shares, at its option, by the payment in cash of $25.00 per share so redeemed together with all accrued and unpaid dividends thereon up to, but excluding, the date fixed for redemption (less any tax required to be deducted or withheld by the Corporation) (the “Redemption Price”). Where applicable, if less than all of the outstanding Series A Shares are at any time to be redeemed, the particular shares to be redeemed shall be selected on a pro rata basis (disregarding fractions) or, with the consent of any applicable stock exchange, in such other manner as the Board may in its sole discretion determine by resolution.
|
(iii) |
Notice of Redemption
.
Notice of any redemption of Series A Shares pursuant to subsection I.1(b)(ii) shall be given to each holder of Series A Shares to be redeemed by the Corporation at least 30 and not more than 60 days prior to the date fixed for redemption. Any notice of redemption of Series A Shares by the Corporation shall be validly and effectively given on the date on which it is sent to each holder of Series A Shares to be redeemed in the manner provided for in subsection I.1(f)(i). Such notice shall set out:
|
(A) |
the date (the “Redemption Date”) on which the redemption is to take place;
|
(B) |
unless all the Series A Shares held by the holder to whom it is addressed are to be redeemed, the number of Series A Shares so held which are to be redeemed; and
|
(C) |
the Redemption Price.
|
(iv) |
Payment of Redemption Price
.
The Corporation shall on the Redemption Date pay or cause to be paid to the holders of the Series A Shares so called for redemption the Redemption Price therefor on presentation and delivery at the principal transfer office of the Transfer Agent in the city of Toronto or such other place or places in Canada designated in the notice of redemption, of the certificate or certificates representing the Series A Shares so called for redemption. Such payment shall be made by electronic funds transfer to an account specified by such holder or by cheque drawn on a Canadian chartered bank or trust company in the amount of the Redemption Price and such electronic transfer of funds or the delivery or mailing of such cheque (in the manner provided for in subsection I.1(f)(i)) shall be a full and complete discharge of the Corporation’s obligation to pay the Redemption Price owed to the holders of Series A Shares so called for redemption to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation as aforesaid and remitted to the proper taxing authority) unless such cheque is not honoured when presented for payment. From and after the Redemption Date, the holders of Series A Shares called for redemption shall cease to be entitled to dividends or to exercise any of the rights of holders of Series A Shares in respect of such shares except the right to receive the Redemption Price, provided that if payment of such Redemption Price is not duly made in accordance with the provisions hereof, then the rights of such holders shall remain unimpaired. If less than all the Series A Shares represented by any certificate shall be redeemed, a new certificate for the balance shall be issued without cost to the holder. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
|
(v) |
Deposit of Redemption Price
.
The Corporation shall have the right, at any time after mailing a notice of redemption, to deposit the aggregate Redemption Price for the Series A Shares thereby called for redemption, or such part thereof as at the time of deposit has not been claimed by the holders entitled thereto, in a special account with a Canadian chartered bank or trust company named in the notice of redemption in trust for the holders of such shares, and upon such deposit being made or upon the Redemption Date, whichever is the later, the Series A Shares in respect of which such deposit shall have been made shall be deemed to be redeemed on the Redemption Date and the rights of each holder thereof shall be limited to receiving, without interest, the holder’s proportionate part (after taking into account any amounts required to be deducted or withheld on account of tax in respect of such holder) of the Redemption Price so deposited upon presentation and surrender of the certificate or certificates representing the Series A Shares so redeemed. Any interest on any such deposit shall belong to the Corporation. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
|
(vi) |
Declaration of Dividends in Respect of Shares to be Redeemed
.
If a dividend is declared by the Board in respect of any Dividend Period during which the Series A Shares are redeemed, notwithstanding the provisions of subsection I.1(a)(iv), no electronic funds transfer or cheque shall be made or issued in payment of such dividend; rather, the amount of such dividend declared shall be considered to be an accrued and unpaid dividend for purposes of subsection I.1(b)(ii).
|
(vii) |
Conversion at the Option of the Holder
.
Subject to the second paragraph of subsection I.1(b)(viii), subsection I.1 (b)(ix) and subsection I.1(b)(x), each holder of Series A Shares shall have the right, at its option, on any Series A Conversion Date, to convert all or any part of its Series
A
Shares registered in its name into Cumulative Floating Rate Preferred Shares, Series B (the “Series B Shares”) on the basis of one Series B Share for each Series A Share converted. Such right may be exercised by notice in writing (an “Election Notice”) given not earlier than the 30th day prior to, and not later than 5:00 p.m. (Toronto time) on the 15th day preceding, the applicable Series A Conversion Date during usual business hours at any principal transfer office of the Transfer Agent, or such other place or places designated by the Corporation. On any conversion of Series A Shares into Series B Shares, the certificates representing the Series B Shares resulting from the conversion of Series A Shares to which such holder is entitled shall be issued in the name of the holder of the Series A Shares converted or in such name or names as such holder may direct in writing; provided that such holder shall pay any applicable security transfer taxes. Any Election Notice shall be accompanied by (1) payment or evidence of payment of the tax (if any) payable; and (2) the certificate or certificates representing the Series A Shares in respect of which the holder thereof desires to convert into Series B Shares with the transfer form on the back thereof or other appropriate stock transfer power of attorney duly endorsed by the holder, or his or her attorney duly authorized in writing, in which Election Notice such holder may elect to convert part only of the Series A Shares represented by such certificate or certificates not theretofore called for redemption in which event the Corporation will issue and deliver or cause to be delivered to such holder, at the expense of the Corporation, a new certificate representing the Series A Shares represented by such certificate or certificates that have not been converted. Such conversion shall be deemed to have been made at 5:00 p.m. (Toronto time) on the Series A Conversion Date, so that the rights of the holder of such Series A Shares as the holder thereof shall cease at such time and the person or persons entitled to receive the Series B Shares upon such conversion will be treated for all purposes as having become the holder or holders of record of such Series B Shares at such time. An Election Notice is irrevocable once received by the Corporation. If the Corporation does not receive an Election Notice within the specified time, the Series A Shares shall be deemed not to have been converted (subject to subsection I.1(b)(ix)).
|
(viii) |
Notice of Conversion Rate and Dividend Rates and Election Notice
.
The Corporation shall, at least 30 days and not more than 60 days prior to each Series A Conversion Date, provide notice in writing to the then registered holders of the Series A Shares of the Series A Conversion Date and a form of Election Notice as specified by the Corporation. On the 30th day prior to each Series A Conversion Date, the Corporation shall give notice in writing to the registered holders of the Series A Shares of the Annual Fixed Dividend Rate for the next Subsequent Fixed Rate Period and the Floating Quarterly Dividend Rate for the next Quarterly Floating Rate Period (as these terms are defined in the Series B Share Provisions).
|
(ix)
|
Automatic Conversion
.
If the Corporation determines that there would remain outstanding on a Series A Conversion Date less than
1,
000,000 Series A Shares, after having taken into account all Election Notices in respect of Series A Shares duly tendered for conversion i
n
to Series B Shares and all Election Notices in respect of Series B Shares duly tendered for conversion into Series A Shares in accordance with the Series B Share Provisio
n
s, in each case received by the Corporation during the time fixed therefor, then, all, but not part, of the remaining outstanding Series A Shares will automatically be converted into Series B Shares on the basis of one Series B Share for each Series A Share on the applicable Series A Conversion Date. The Corporation shall give notice in writing of the automatic conversion thereof to all holders of the Series A Shares at least seven days prior to the applicable Series A Conversion Date.
|
(x)
|
Res
t
rictions on Conversion
.
The holders of Series A Shares shall not be entitled to convert their shares into Series B Shares if the Corporation determines that there would remain outstanding on a Series A Conversion Date less than
1,
000,000 Series B Shares after having taken into account all Election Notices in respect of Series A Shares duly tendered for conversion into Series B Shares and all Election Notices in respect of Series B Shares duly tendered for conversion into Series A Shares in accordance with the Series B Share Provisions, in each case received by the Corporation during the time fixed therefor. The Corporation shall give notice in writing of the inability to convert Series A Shares to all holders of the Series A Shares at least seven days prior to the applicable Series A Conversion Date.
|
(xi)
|
Non-Residents
.
The Corporation is not required to (but may at its option) issue Series B Shares upon the conversion of Series A Shares into Series B Shares to any person whose address is in, or whom the Corporation or the Transfer Agent has reason to believe is a resident of, any jurisdiction outside Canada, to the extent that such issue would require the Corporation to take any action to comply with the securities laws or analogous laws of such jurisdiction.
|
(xii)
|
Purchase for Cancellation
.
Subject to applicable laws, the Corporation may, at any time, purchase for cancellation (if obtainable), out of capital or otherwise, the whole or any part of the Series A Shares outstanding from time to time at any price by tender to all holders of record of Series A Shares or through the facilities of any stock exchange on which the Series A Shares are listed, or in any other manner, provided that in the case of a purchase in any other manner the price for such Series A Shares so purchased for cancellation shall not exceed the highest price offered for a board lot of the Series A Shares on any stock exchange on which such shares are listed on the date of purchase for cancellation, plus the costs of purchase. If upon any tender to holders of Series A Shares under the provisions of this subsection
l
.
1(
b)(xii)
,
more shares are offered than the Corporation is prepared to purchase, the shares so offered will be purchased as nearly as may be pro rata (disregarding fractions) according to the number of Series A Shares so offered by each of the holders of Series A Shares who offered shares to such tender. From and after the date of purchase of any Series A Shares under the provisions of this subsection
l
.
1(
b)(xii), the shares so purchased shall be cancelled.
|
(xiii)
|
Conversion – General
.
On the conversion of a Series A Share to a Series B Share pursuant to the terms of these Series A Share Provisions, each such Series A Share shall become an issued Series B Share and the number of unissued Series A Shares shall be increased by the number of Series A Shares that became Series B Shares.
|
(c)
|
Votin
g
Ri
g
hts
|
|
(i) |
Votin
g
Ri
g
hts – General
.
Except as otherwise required by law or in the conditio
n
s attaching to the Preferred Shares as a class, the holders of Series A Shares shall not be entitled to receive notice of, attend at, or vote at any meeting of shareholders of the Corporation, unless and until the Corporation shall have failed to pay eight Quarterly Dividends on the Series A Shares in accordance with the terms hereof, whether or not consecutive and whether or not such dividends were declared and whether or not there are any monies of the Corporation properly applicable to the payment of such dividends. In the event of such non-payment, and for only so long as any such dividends remain in arrears, the holders of the Series A Shares shall be entitled to receive notice of all meetings of shareholders of the Corporation and to attend thereat (other than a separate meeting of the holders of another series or class of shares), and shall at any such meetings which they shall be entitled to attend, except when the vote of the holders of shares of any other class or series is to be taken separately and as a class or series, be entitled to vote together with all of the voting shares of the Corporation on the basis of one vote in respect of each Series A Share held by each such holder, until all such arrears of such dividends shall have been paid, whereupon such rights shall cease unless and until the Corporation shall again fail to pay eight Quarterly Dividends on the Series A Shares in accordance with the terms hereof, whether or not consecutive and whether or not such dividends were declared and whether or not there are any monies of the Corporation properly applicable to the payment of such dividends, in which event such voting rights shall become effective again and so on from time to time.
|
(d)
|
Issue Price
|
(e)
|
Election under the
Income Tax Act
(Canada)
|
(f)
|
Notice and Interpretation
|
(i) |
Notices
.
Any notice, cheque, invitation for tenders or other communication from the Corporation herein provided for shall be sufficiently given, sent or made if delivered or if sent by first class unregistered mail, postage prepaid, to the holders of the Series A Shares at their respective addresses appearing on the records of the Corporation maintained by th
e
Corporation or th
e
Transfer Agent, or, in the case of joint holders, to the address of the holder whose name appears first on the records of the Corporation maintained by the Corporation or the Transfer Agent as one of such joint holders, or, in the event of the address of any of such holders not so appearing, then at
the last address of such holder known to the Corporation. Accidental failure to give such notice, invitation for tenders or other communication to one or more holders of the Series A Shares shall not affect the validity of the notices, invitations for tenders or other communications properly given or any action taken pursuant to such notice, invitation for tender or other communication but, upon such failure be
in
g discovered, the notice, invitation for tenders or other communication, as the case may be, shall be sent forthwith to such holder or holders. If any notice, cheque, invitation for tenders or other communication from the Corporation given to a holder of Series A Shares pursuant to this subsection is returned on three consecutive occasions because the holder cannot be found, the Corporation shall not be required to give or mail any further notices, cheques, invitations for tenders or other communications to such shareholder until the holder informs the Corporation in writing of such holder’s new address.
|
(A)
|
give such notice by publication thereof once in a newspaper having national circulation in Canada or, if there is no newspaper having national circulation in Canada, in an English language newspaper of general circulation published in each of Vancouver, Calgary, Toronto and Montreal and such notice shall be deemed to have been validly given on the day next succeeding its publication; and
|
(B)
|
fulfill the requirement to send such cheque or such share certificate by arranging for the delivery thereof to such holder by the Transfer Agent at its principal offices in the city of Toronto, and such cheque and/or share certificate shall be deemed to have been sent on the date on which notice of such arrangement shall have been given as provided in (A) above, provided that as soon as the Board determines that mail service is no longer interrupted or threatened to be interrupted, such cheque or share certificate, if not theretofore delivered to such holder, shall be sent by mail as herein provided.
|
(i i ) |
Interpretation
.
If any day on w
hi
ch any dividend on the Series A Shares is payable, on which any Redemption Date or any Series A Conversion Date shall occur, or on or by which any other action is required or permitted to be taken hereunder is not a Business Day, then such dividend shall be payable, such Redemption Date or Se
ri
es A Conversion Date shall occur or such other action shall be required or permitted to be taken on the immediately following day that is a Business Day.
|
(A)
|
“Annual Fixed Dividend Rate” means, for any Subsequent Fixed Rate Period, the annual rate (expressed as a percentage rounded to the nearest one hundred-thousandth of one percent (with 0.000005% being rounded up
))
equal to the sum of the Government of Canada Yield on the applicable Fixed Rate Calculation Date plus 2.94%;
|
(B)
|
“Bloomberg Screen GCAN5YR Page” means the display designated as page “GCAN5YR<INDEX>
“
on the Bloomberg Financial L.P. service (or such other page as may replace the GCAN5YR page on that service or if such service is no longer available, a successor service as determined by the Corporation) for purposes of displaying Government of Canada Yields;
|
(C)
|
“Business Day” means a day other than a Saturday, a Sunday or any other day that is a statutory or civic holiday in the place where the Corporation has its
he
ad of
fi
ce;
|
(D)
|
“Fixed Rate Calculation Date” means, for any Subsequent Fixed Rate Period, the 30th day prior to the first day of such Subsequent Fixed Rate Period;
|
(E)
|
“
Government of Canada Yield” on any date means the yield to maturity on such date (assuming semi-annual compounding) of a Canadian dollar denominated non-callable Government of Canada bond with a term to maturity of five years as quoted as of
10
:00 a.m. (Toronto time) on such date and which appears on the Bloomberg Screen GCAN5YR Page on such date; provided that, if such rate does not appear on the Bloomberg Screen GCAN5YR Page on such date, the Government of Canada Yield will mean the average of the yields determined by two registered Canadian investment dealers selected by the Corporation, as being the yield to maturity on such date (assuming semi-annual compounding) which a Canadian dollar denominated non-callable Government of Canada bond would carry if issued in Canadian dollars at
10
0% of its principal amount on such date with a term to maturity of five years;
|
(F)
|
“
in priority to”, “on a parity with” and “junior to” have reference to the order of priority in payment of dividends and in the distribution of assets in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, or other distribution of the assets of the Corporation among its shareholders for the purpose of winding-up its affairs;
|
(G)
|
“Initial Fixed Rate Period” means the period from and including the date of the initial issue of the Series A Shares to, but excluding, December 3
1,
20
18
;
|
(H)
|
“Quarter End Date” has the meaning given to it in subsection
l
.
1(
a)(i);
|
(I)
|
“ranking as to capital” and similar expressions mean ranking with respect to priority in the distribution of assets of the Corporation in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, upon a return of capital or upon any other distribution of the assets of the Corporation among its shareholders for the purpose of winding- up its affairs;
|
(J)
|
“ranking as to dividends” and similar expressions mean ranking with respect to priority in the payment of dividends by the Corporation;
|
(K)
|
“Series A Conversion Date” means December 3
1,
2018 and December 31 (or, if such date is not a Business Day, the immediately following Business Day) of every fifth year thereafter;
|
(L)
|
“Series A Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series A Shares;
|
(M)
|
“Series B Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series B Shares;
|
(N) |
“Subsequent Fixed Rate Period” means for the initial Subsequent Fixed Rate Period, the period from and including December 31, 2018 to, but excluding, December 3
1,
2023 and for each succeeding Subsequent Fixed Rate Period, the period commencing on the day immediately following the end of
t
he immediately preceding Subsequent Fixed Rate Period to, but excluding, December 31 in the fifth year thereafter; and
|
( O ) |
“Transfer Agent” means C
I
BC Mellon Trust Company at its principal transfer office in Toronto, Ontario, its successors and assigns, or such other person as from time to time may be appointed as the registrar and transfer agent for the Series A Shares.
|
(g)
|
Modification
|
(h)
|
Approval of Holders of Series A Shares
|
(i) |
Approval of Holders of Series A Shares
.
Except as otherwise provided herein, any approval of the holders of the Series A Shares with respect to any matters requiring the consent of such holders may be given in such manner as may then be required by law, subject to a minimum requirement that such approval be given by a resolution signed by all such holders or passed by the affirmative vote of at least two- thirds of the votes cast by the holders who voted in respect of that resolution at a meeting of the holders duly called for that purpose and at which the holders of
10
% of the outstanding Series A Shares are present in person or represented by proxy. If at any such meeting the holder(s) of
10
% of the outstanding Series A Shares are not present in person or represented by proxy within one-half hour after the ti
m
e appointed for such meeting, then the meeting shall be adjourned to such date not less than
15
days thereafter and to such time and place as may be designated by the chairman of such meeting, and not less than
10
days’ written notice shall be given of such adjourned meeting. At such adjourned meeting the holders(s) of Series A Shares present in person or represented by proxy shall form the necessary quorum and may transact the business for which the meeting was originally called and a resolution passed thereat by the affirmative vote of at least two-thirds of the votes cast at such meeting shall constitute the approval of the holders of the Series A Shares. At any meeting of holders of Series A Shares as a series, each such holder shall be entitled to one vote in respect of each share held.
|
(ii) |
Formalities, etc
.
The proxy rules applicable to, the formalities to be observed in respect of the giving notice of, and the formalities to be observed in respect of the conduct of, any meeting or any adjourned meeting of holders of the Series A
Shares shall be those required by law, as may from time to time be supplemented by the by-laws of the Corporation. On every poll taken at every meeting of holders of Series A Shares as a series, each holder entitled to vote thereat shall have one vote in respect of each Series A Share held.
|
(i) |
Rights on Liquidation
|
(j) |
Withholding Taxes
|
(i) |
Withholding Taxes
.
For greater certainty, and notwithstanding any other provision of this Section I.1, the Corporation shall be entitled to deduct and withhold any amounts required to be deducted or withheld on account of any taxes from any amounts (including shares) payable or otherwise deliverable in respect of the Series A Shares, including on the redemption, cancellation or conversion of the Series A Shares. To the extent that any amounts are deducted or withheld, such deducted or withheld amounts shall be treated for all purposes hereof as having been paid or delivered to the person in respect of which such deduction or withholding was made. The Corporation is hereby authorized to sell or otherwise dispose of all or any number of Series B
Shares otherwise deliverable to a holder of Series A Shares on the conversion of such Series A Shares in order to meet any applicable tax deduction or withholding tax requirements.
|
(ii) |
Transfer Taxes
.
For greater certainty, and notwithstanding any other provision of this Section I.1
,
the Corporation shall not be required to pay any tax which may be:
|
(A) |
imposed upon the person or persons to whom Series B Shares are issued,
|
(B) |
payable in respect of the issuance of such Series B Shares or a certificate
therefor, or
|
(C) |
payable in respect of any transfer involved in the issuance and delivery of any certificate in the name or names other than that of the holder of the Series A Shares,
|
II.1 |
CUMULATIVE FLOATING RATE PREFERRED SHARES, SERIES B
|
(a) |
Dividends
|
(i) |
Dividend Payment Dates
.
The dividend payment dates
(the “Dividend Payment Dates”) in respect of the dividends payable on the Series B Shares shall be the last day (or if such day is not a Business Day, the immediately following Business Day) of each of the months of March, June, September and December in each year.
|
(ii) |
Payment of Dividends
.
The holders of Series B Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the board of directors of the Corporation (the “Board”), out of moneys of the Corporation properly applicable to the payment of dividends, quarterly floating rate, cumulative, preferential cash dividends in respect of each Quarterly Floating Rate Period in an amount per Series B Share determined by multiplying the applicable Floating Quarterly Dividend Rate by $25.00 (“Quarterly Dividends”).
|
(iii) |
Dividend for Other than a Full Quarterly Floating Rate Period
.
The holders of Series B Shares shall be entitled to receive, and the Corporation shall pay thereon, if, as and when declared by the Board out of moneys of the Corporation properly applicable to the payment of dividends, cumulative, preferential cash dividends for any period which is less than a full Quarterly Floating Rate Period, in an amount per share with respect to any Series B Share:
|
(A) |
which is issued, redeemed or converted during any Quarterly Floating Rate
Period;
|
(B) |
where the assets of the Corporation are distributed to the holders of the Series B Shares pursuant to subsection II.1(i) with an effective date during any Quarterly Floating Rate Period; or
|
(C) |
in any other circumstance where the number of days in a Quarterly Floating Rate Period that such share has been outstanding is less than a full Quarterly Floating Rate Period;
|
(iv) |
Payment Procedure
.
The Corporation shall pay the dividends declared on the Series B Shares on the relevant Dividend Payment Date (less any tax required to be deducted or withheld by the Corporation) by electronic funds transfer or by cheque(s) drawn on a Canadian chartered bank or trust company and payable in lawful money of Canada at any branch of such bank or trust company in Canada or in such other manner, not contrary to applicable law, as the Corporation shall reasonably determine. The delivery or mailing of any cheque to a holder of Series B Shares (in the manner provided for in subsection II.1(f)(i)) or the electronic transfer of funds to an account specified by such holder shall be a full and complete discharge of the Corporation’s obligation to pay the dividends to such holder to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation from the related dividends as aforesaid and remitted to the proper taxing authority), unless such cheque is not honoured when presented for payment. Subject to applicable law, dividends which are represented by a cheque which has not been presented to the Corporation’s banker for payment or that otherwise remain unclaimed for a period of six years from the date on which they were declared to be payable may be reclaimed and used by the Corporation for its own purposes.
|
(v) |
Cumulative Payment of Dividends
.
If on any Dividend Payment Date, the Quarterly Dividends payable in respect of the Dividend Period ending in the
calendar month in which such Dividend Payment Date occurs are not paid in full on all of the Series B Shares then outstanding, such Quarterly Dividends, or the unpaid part thereof, shall be paid (less any tax required to be deducted or withheld by the Corporation) on a subsequent date or dates determined by the Board on which the Corporation shall have sufficient monies properly applicable to the payment of such Quarterly Dividends. The holder of Series B Shares shall not be entitled to any dividends other than or in excess of the cumulative preferential cash dividends herein provided for.
|
(vi) |
Priority
.
The Series B Shares rank senior to the Common Shares and rank on a parity with every other series of Preferred Shares as to dividends.
|
(b) |
Redemption, Conversion and Purchase
|
(i) |
General
.
To the extent permitted by applicable law, the Series B Shares may be redeemed, convened or purchased by the Corporation as provided in this subsection II.1(b) but not otherwise.
|
(ii) |
Corporation’s Redemption Rights
.
The Series B Shares shall not be redeemable by the Corporation on or prior to December 31, 2018. On any Series B Conversion Date, the Corporation may redeem all or any number of the outstanding Series B Shares, at its option, by the payment in cash of $25.00 per share so redeemed together with all accrued and unpaid dividends thereon to, but excluding, the date fixed for redemption (less any tax required to be deducted or withheld by the Corporation) (the “Conversion Date Redemption Price”).
|
(iii) |
Notice of Redemption
.
Notice of any redemption of Series B Shares pursuant to subsection II.1(b)(ii) shall be given to each holder of Series B Shares to be redeemed by the Corporation at least 30 and not more than 60 days prior to the date fixed for redemption. Any notice of redemption of Series B Shares by the Corporation shall be validly and effectively given on the date on which it is sent to each holder of Series B Shares to be redeemed in the manner provided for in subsection II.1(f)(i). Such notice shall set out:
|
(A) |
the date (the “Redemption Date”) on which the redemption is to take place;
|
(B) |
unless all the Series B Shares held by the holder to whom it is addressed are to be redeemed, the number of Series B Shares so held which are to be redeemed; and
|
(C) |
the Conversion Date Redemption Price or the Non-Conversion Date Redemption Price, as applicable (such applicable redemption price referred to hereinafter as the “Redemption Price”).
|
(iv) |
Payment of Redemption Price
.
The Corporation shall on the Redemption Date pay or cause to be paid to the holders of the Series B Shares so called for redemption the Redemption Price therefor on presentation and delivery at the principal transfer office of the Transfer Agent in the city of Toronto or such other place or places in Canada designated in the notice of redemption, of the certificate or certificates representing the Series B Shares so called for redemption. Such payment shall be made by electronic funds transfer to an account specified by such holder or by cheque drawn on a Canadian chartered bank or trust company in the amount of the Redemption Price and such electronic transfer of funds or the delivery or mailing of such cheque (in the manner provided for in subsection II.1 (f)(i)) shall be a full and complete discharge of the Corporation’s obligation to pay the Redemption Price owed to the holders of Series B Shares so called for redemption to the extent of the sum represented thereby (plus the amount of any tax required to be and in fact deducted or withheld by the Corporation as aforesaid and remitted to the proper taxing authority) unless such cheque is not honoured when presented for payment. From and after the Redemption Date, the holders of Series B Shares called for redemption shall cease to be entitled to dividends or to exercise any of the rights of holders of Series B Shares in respect of such shares except the right to receive the Redemption Price, provided that if payment of such Redemption Price is not duly made in accordance with the provisions hereof, then the rights of such holders shall remain unimpaired. If less than all the Series B Shares represented by any certificate shall be redeemed, a new certificate for the balance shall be issued without cost to the holder. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
|
(v) |
Deposit of Redemption Price
.
The Corporation shall have the right, at any time after mailing a notice of redemption, to deposit the aggregate Redemption Price for the Series B Shares thereby called for redemption, or such part thereof as at the time of deposit has not been claimed by the holders entitled thereto, in a special account with a Canadian chartered bank or trust company named in the notice of redemption in trust for the holders of such shares, and upon such deposit being made or upon the Redemption Date, whichever is the later, the Series B Shares in respect of which such deposit shall have been made shall be deemed to be redeemed on the Redemption Date and the rights of each holder thereof shall be limited to receiving, without interest, the holder’s proportionate part (after taking into account any amounts required to be deducted or withheld on account of tax in respect of such holder) of the Redemption Price so deposited upon presentation and surrender of the certificate or certificates representing the Series B Shares so redeemed. Any interest on any such deposit shall belong to the Corporation. Subject to applicable law, redemption monies which remain unclaimed for a period of six years from the Redemption Date may be reclaimed and used by the Corporation for its own purposes.
|
(vi) |
Declaration of Dividends in Respect of Shares to be Redeemed
.
If a dividend is declared by the Board in respect of any Quarterly Floating Rate Period during which the Series B Shares are redeemed, notwithstanding the provisions of subsection II.1(a)(iv), no electronic funds transfer or cheque shall be made or issued in payment of such dividend; rather, the amount of such dividend declared shall be considered to be an accrued and unpaid dividend for purposes of subsection II.1(b)(ii).
|
(vii) |
Conversion at the Option of the Holder
.
Subject to second paragraph of subsection II.1(b)(viii), subsection II.1(b)(ix) and subsection II.1(b)(x), each holder of Series B Shares shall have the right, at its option, on any Series B Conversion Date, to convert all or any part of its Series B Shares registered in its name into Cumulative Rate Reset Preferred Shares, Series A (the “Series A Shares”) on the basis of one Series A Share for each Series B Share converted. Such right may be exercised by notice in writing (an “Election Notice”) given not earlier than the 30th day prior to and not later than 5:00 p.m. (Toronto time) on the 15th day preceding the applicable Series B Conversion Date during usual business hours at any principal transfer office of the Transfer Agent, or such other place or places designated by the Corporation. On any conversion of Series B Shares into Series A Shares, the certificates representing the Series A Shares resulting from the conversion of Series B Shares to which such holder is entitled shall be issued in the name of the holder of the Series B Shares converted or in such name or names as such holder may direct in writing; provided that such holder shall pay any applicable security transfer taxes. Any Election Notice shall be accompanied by (1) payment or evidence of payment of the tax (if any) payable; and (2) the certificate or certificates representing the Series B Shares in respect of which the holder thereof desires to convert into Series A Shares with the transfer form on the back thereof or other appropriate stock transfer power of attorney duty endorsed by the holder, or his or her attorney duly authorized in writing, in which Election Notice such holder may elect to convert part only of the Series B Shares represented by such certificate or certificates not theretofore called for redemption in which event the Corporation will issue and deliver or cause to be delivered to such holder, at the expense of the Corporation, a new certificate representing the Series B Shares represented by such certificate or certificates that have not been converted. Such conversion shall be deemed to have been made at 5:00 p.m. (Toronto time) on the Series B Conversion Date, so that the rights of the holder of such Series B Shares as the holder thereof shall cease at such time and the person or persons entitled to receive the Series A Shares upon such conversion will be treated for all purposes as having become the holder or holders of record of such Series A Shares at such time. An Election Notice is irrevocable once received by the Corporation. If the Corporation does not receive an Election Notice within the specified time, the Series B Shares shall be deemed not to have been converted (subject to subsection II.1(b)(ix)).
|
(viii) |
Notice of Conversion Date and Dividend Rates and Election Notice
.
The Corporation shall, at least 30 days and not more than 60 days prior to each Series B Conversion Date, provide notice in writing to the then registered holders of the Series B Shares of the Series B Conversion Date and a form of Election Notice as specified by the Corporation. On the 30th day prior to each Series B Conversion Date, the Corporation shall give notice in writing to the registered holders of the Series B Shares of the Floating Quarterly Dividend Rate for the next Quarterly Floating Rate Period and the Annual Fixed Dividend Rate applicable to the Series A Shares for the next Subsequent Fixed Rate Period (as such terms are defined in the Series A Share Provisions).
|
(ix) |
Automatic Conversion
.
If the Corporation determines that there would remain outstanding on a Series B Conversion Date less than 1,000,000 Series B Shares, after having taken into account all Election Notices in respect of Series B Shares duly tendered for conversion into Series A Shares and all Election Notices in respect of Series A Shares duly tendered for conversion into Series B Shares in accordance with the Series A Share Provisions, in each case received by the Corporation during the time fixed therefor then, all, but not part, of the remaining outstanding Series B Shares will automatically be converted into Series A Shares on the basis of one Series A
Share for each Series B Share on the applicable Series B Conversion Date. The Corporation shall give notice in writing of the automatic conversion thereof to all holders of the Series B Shares at least seven days prior to the applicable Series B Conversion Date.
|
(x) |
Restrictions on Conversion
.
The holders of Series B Shares shall not be entitled to convert their shares into Series A Shares if the Corporation determines that there would remain outstanding on a Series B Conversion Date less than 1,000,000 Series A Shares after having taken into account all Election Notices in respect of Series B Shares duly tendered for conversion into Series A Shares and all Election Notices in respect of Series A Shares duly tendered for conversion into Series B Shares in accordance with the Series A
Share Provisions, in each case received by the Corporation during the time fixed therefor. The Corporation shall give notice in writing of the inability to convert Series B Shares to all holders of the Series B Shares at least seven days prior to the applicable Series B Conversion Date.
|
(xi) |
Non-Residents
.
The Corporation is not required to (but may at its option) issue Series A Shares upon the conversion of Series B Shares into Series A Shares to any person whose address is in, or whom the Corporation or the Transfer Agent has reason to believe is a resident of, any jurisdiction outside Canada, to the extent that such issue would require the Corporation to take any action to comply with the securities laws or analogous laws of such jurisdiction.
|
(xii) |
Purchase for Cancellation
.
Subject to applicable laws, the Corporation may, at any time, purchase for cancellation (if obtainable), out of capital or otherwise, the whole or any part of the Series B Shares outstanding from time to time at any price by tender to all holders of record of Series B Shares or through the facilities of any stock exchange on which the Series B Shares are listed, or in any other manner, provided that in the case of a purchase in any other manner the price for such Series B Shares so purchased for cancellation shall not exceed the highest price offered for a board lot of the Series B Shares on any stock exchange on which such shares are listed on the date of purchase for cancellation, plus the costs of purchase. If upon any tender to holders of Series B Shares under the provisions of this subsection II.1(b)(xii), more shares are offered than the Corporation is prepared to purchase, the shares so offered will be purchased as nearly as may be pro rata (disregarding fractions) according to the number of Series B Shares so offered by each of the holders of Series B Shares who offered shares to such tender. From and after the date of purchase of any Series B Shares under the provisions of this subsection II.1(b)(
xii), the shares so purchased shall be cancelled.
|
(xiii) |
Conversion — General
.
On the conversion of a Series B
Share to a Series A Share pursuant to the terms of these Series B Share Provisions, each such Series B Share shall become an issued Series A Share and the number of unissued Series B Shares shall be increased by the number of Series B Shares that became Series A Shares.
|
(c)
|
Voting Rights
|
(i)
|
Voting Rights – General
. Except as otherwise required by law or in the conditions attaching to the Preferred Shares as a class, the holders of Series B Shares shall not be entitled to receive notice of, attend at, or vote at any meeting of shareholders of the Corporation, unless and until the Corporation shall have failed to pay eight Quarterly Dividends on the Series B Shares in accordance with the terms hereof, whether or not consecutive and whether or not such dividends were declared and whether or not there are any monies of the Corporation properly applicable to the payment of such dividends.
|
|
In the event of such non-payment, and for only so long as any such dividends remain in arrears, the holders of the Series B Shares shall be entitled to receive notice of all meetings of shareholders of the Corporation and to attend thereat (other than a separate meeting of the holders of another series or class of shares), and shall at any such meetings which they shall be entitled to attend, except when the vote of the holders of shares of any other class or series is to be taken separately and as a class or series, be entitled to vote together with all of the voting shares of the Corporation on the basis of one vote in respect of each Series B Share held by each such holder, until all such arrears of such dividends shall have been paid, whereupon such rights shall cease unless and until the Corporation shall again fail to pay eight Quarterly Dividends on the Series B Shares in accordance with the terms hereof, whether or not consecutive and whether or not such dividends were declared and whether or not there are any monies of the Corporation properly applicable to the payment of such dividends, in which event such voting rights shall become effective again and so on from time to time.
|
(d)
|
Issue Price
|
|
The Series B Shares will only be issuable upon conversion of Series A Shares and will have an ascribed issue price of $25.00 per share.
|
|
In the event of a conversion of a Series A Share to a Series B Share the amount to be deducted from the stated capital account maintained for the Series A Shares and added to the stated capital account maintained for the Series B Shares will be $25.00 per share so converted.
|
(e)
|
Election Under the Income Tax Act
|
|
The Corporation shall elect in the manner and within the time provided under the Tax Act, under Subsection 191.2(1) of Part VI.1 of the Tax Act, or any successor or replacement provision of similar effect, and take all other necessary action under the Tax Act, to pay or cause payment of tax under Part VI.1 of the Tax Act at a rate such that the corporate holders will not be required to pay tax on dividends received on the Series B Shares under Section 187.2 of Part IV. 1 of the Tax Act or any successor or replacement provision of similar effect.
|
(f)
|
Notice and Interpretation
|
(i)
|
Notices
.
Any notice, cheque, invitation for tenders or other communication from the Corporation herein provided for shall be sufficiently given, sent or made if delivered or if sent by first class unregistered mail, postage prepaid, to the holders of the Series B Shares at their respective addresses appearing on the records of the Corporation maintained by the Corporation or the Transfer Agent, or, in the case of joint holders, to the address of the holder whose name appears first on the records of the Corporation maintained by the Corporation or the Transfer Agent as one of such joint holders, or, in the event of the address of any of such holders not so appearing, then at the last address of such holder known to the Corporation. Accidental failure to give such notice, invitation for tenders or other communication to one or more holders of the Series B Shares shall not affect the validity of the notices, invitations tor tenders or other communications properly given or any action taken pursuant to such notice, invitation for tender or other communication but, upon such failure being discovered, the notice, invitation for tenders or other communication, as the case may be, shall be sent forthwith to such holder or holders.
|
|
If any notice, cheque, invitation for tenders or other communication from the Corporation given to a holder of Series B Shares pursuant to this subsection is returned on three consecutive occasions because the holder cannot be found, the Corporation shall not be required to give or mail any further notices, cheques, invitations for tenders or other communications to such shareholder until the holder informs the Corporation in writing of such holder’s new address.
|
|
If the Board determines that mail service is or is threatened to be interrupted at the time when the Corporation is required or elects to give any notice hereunder by mail, or is required to send any cheque or any share certificate to a holder, whether in connection with the redemption of such share or otherwise, the Corporation may, notwithstanding the provisions hereof:
|
(A)
|
give such notice by publication thereof once in a newspaper having national circulation in Canada or, if there is no newspaper having national circulation in Canada, in an English language newspaper of general circulation published in each of Vancouver, Calgary, Toronto and Montreal and such notice shall be deemed to have been validly given on the day next succeeding its publication; and
|
(B)
|
fulfill the requirement to send such cheque or such share certificate by arranging for the delivery thereof to such holder by the Transfer Agent at its principal offices in the city of Toronto, and such cheque and/or share certificate shall be deemed to have been sent on the date on which notice of such arrangement shall have been given as provided in (A) above, provided that as soon as the Board determines that mail service is no longer interrupted or threatened to be interrupted, such cheque or share certificate, if not theretofore delivered to such holder, shall be sent by mail as herein provided.
|
(ii)
|
Interpretation
.
If any day on which any dividend on the Series B Shares is payable, on which any Redemption Date or any Series B Conversion Date shall occur, or on or by which any other action is required or permitted to be taken hereunder is not a Business Day, then such dividend shall be payable, such Redemption Date or Series B Conversion Date shall occur or such other action shall be required or permitted to be taken on the immediately following day that is a Business Day.
|
|
If a holder of Series B Shares is entitled to a cheque and such cheque is not received by the holder, or if the cheque is lost or destroyed, the Corporation, on being furnished with reasonable evidence of non-receipt, loss or destruction, and an indemnity satisfactory to the Corporation, acting reasonably, will issue to the holder of the Series B Shares a replacement cheque for the amount of the original cheque.
|
|
The Corporation will be entitled to deduct or withhold from any amount payable to a holder of Series B Shares under these Series B Share provisions any amount required by law to be deducted or withheld from that payment.
|
|
Reference to any statute is to that statute as in force from time to time, including any regulations, rules, policy statements or guidelines made under that statute, and includes any statute that may be enacted in substitution of that statute.
|
|
All references herein to a holder of Series B Shares shall be interpreted as referring to a registered holder of the Series B Shares.
|
|
For the purposes hereof:
|
(A)
|
“Business Day” means a day other than a Saturday, a Sunday or any other day that is a statutory or civic holiday in the place where the Corporation has its head office;
|
(B)
|
“Floating Quarterly Dividend Rate” means, for any Quarterly Floating Rate Period, the rate (expressed as a percentage rounded to the nearest one hundred-thousandth of one percent (with 0.000005%) being rounded up)) equal to the sum of the T-Bill Rate on the applicable Floating Rate Calculation Date plus 2.94% per annum (calculated on the basis of the actual number of days elapsed in such Quarterly Floating Rate Period divided by 365);
|
(C)
|
“Floating Rate Calculation Date” means for any Quarterly Floating Rate Period, the 30th day prior to the first day of such Quarterly Floating Rate Period;
|
(D)
|
“in priority to”, “on a parity with” and “junior to” have reference to the order of priority in payment of dividends and in the distribution of assets in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, or other distribution of the assets of the Corporation among its shareholders for the purpose of winding-up its affairs;
|
(E)
|
“Quarterly Commencement Date” means the last day of each of March, June, September and December in each year, commencing on December 31, 2018;
|
(F)
|
“Quarterly Floating Rate Period” means the period from and including the day immediately following the end of the immediately preceding Quarterly Floating Rate Period to, but excluding, the next succeeding Quarterly Commencement Date;
|
(G)
|
“ranking as to capital” and similar expressions mean ranking with respect to priority in the distribution of assets of the Corporation in the event of any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary, upon a return of capital or upon any other distribution of the assets of the Corporation among its shareholders for the purpose of winding- up its affairs;
|
(H)
|
“ranking as to dividends” and similar expressions mean ranking with respect to priority in the payment of dividends by the Corporation;
|
(I)
|
“Series A Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series A Shares;
|
(J)
|
“Series B Conversion Date” means December 31, 2023 and December 31 (or, if such date is not a Business Day, the immediately following Business Day) of every fifth year thereafter;
|
(K)
|
“Series B Share Provisions” means the designation, rights, privileges, restrictions and conditions of the Series B Shares;
|
(L)
|
“T-Bill Rate” means, for any Quarterly Floating Rate Period, the average yield expressed as a percentage per annum on 90-day Government of Canada Treasury Bills, using the 3-month average results, as reported by the Bank of Canada, for the most recent treasury bills auction preceding the applicable Floating Rate Calculation Date (with auction results being posted on Reuters page BOCBILL or such other page as may replace such page on that service or if such service is no longer available, a successor service as determined by the Corporation); and
|
(M)
|
“Transfer Agent” means CIBC Mellon Trust Company at its principal transfer office in Toronto, Ontario, its successors and assigns, or such other person as from time to time may be appointed as the registrar and transfer agent for the Series B Shares.
|
(g)
|
Modification
|
|
Subject to subsection ll.1(b)(ii), the designation, rights, privileges, restrictions and conditions attaching to the Series B Shares as a series may be repealed, deleted, varied, modified, amended or amplified from time to time only with the approval of the holders of the Series B Shares given in accordance with the CBCA and subsection 11.1(h) and with any required approvals of any stock exchanges on which the Series B Shares may be listed.
|
(h)
|
Approval of Holders of Series B Shares
|
(i)
|
Approval of Holders of Series B Shares
. Except as otherwise provided herein, any approval of the holders of the Series B Shares with respect to any matters requiring the consent of such holders may be given in such manner as may then be required by law, subject to a minimum requirement that such approval be given by a resolution signed by all such holders or passed by the affirmative vote of at least two-thirds of the votes cast by the holders who voted in respect of that resolution at a meeting of the holders duly called for that purpose and at which the holders of 10% of the outstanding Series B Shares are present in person or represented by proxy. If at any such meeting the holder(s) of 10% of the outstanding Series B Shares are not present in person or represented by proxy within one-half hour after the time appointed for such meeting, then the meeting shall be adjourned to such date not less than 15 days thereafter and to such time and place as may be designated by the chairman of such meeting, and not less than 10 days’ written notice shall be given of such adjourned meeting. At such adjourned meeting the holders(s) of Series B Shares present in person or represented by proxy shall form the necessary quorum and may transact the business for which the meeting was originally called and a resolution passed thereat by the affirmative vote of at least two-thirds of the votes cast at such meeting shall constitute the approval of the holders of the Series B Shares. At any meeting of holders of Series B Shares as a series, each such holder shall be entitled to one vote in respect of each share held.
|
(ii)
|
Formalities, etc
. The proxy rules applicable to, the formalities to be observed in respect of the giving notice of, and the formalities to be observed in respect of the conduct of, any meeting or any adjourned meeting of holders of the Series B Shares shall be those required by law, as may from time to time be supplemented by the by-laws of the Corporation. On every poll taken at every meeting of holders of Series B Shares as a series, each holder entitled to vote thereat shall have one vote in respect of each Series B Share held.
|
(i)
|
Rights on Liquidation
|
|
In the event of the liquidation, dissolution or winding-up of the Corporation or other distribution of assets of the Corporation among its shareholders for the purpose of winding-up its affairs, whether voluntary or involuntary, subject to the prior satisfaction of the claims of all creditors of the Corporation and of holders of shares of the Corporation ranking prior to the Series B Shares, the holders of the Series B Shares shall rank (a) on a parity with the Preferred Shares of every other series and (b) senior to the Common Shares and the shares of any other class ranking junior to the Preferred Shares. The Series B Shares shall be entitled to receive an amount equal to $25.00 per Series B Share, together with an amount equal to all accrued and unpaid dividends up to but excluding the date fixed for payment or distribution (less any tax required to be deducted or withheld by the Corporation), before any amount is paid or any assets of the Corporation are distributed to the holders of any shares of the Corporation ranking junior as to capital to the Series B Shares. Upon payment to the holders of the Series B Shares of the amounts so payable to them, such holders shall not be entitled to share in any further distribution of the assets of the Corporation.
|
(j)
|
Withholding Taxes
|
(i)
|
Withholding Taxes
. For greater certainty, and notwithstanding any other provision of this Section II.1, the Corporation shall be entitled to deduct and withhold any amounts required to be deducted or withheld on account of any taxes from any amounts (including shares) payable or otherwise deliverable in respect of the Series B Shares, including on the redemption, cancellation or conversion of the Series B Shares. To the extent that any amounts are deducted or withheld, such deducted or withheld amounts shall be treated for all purposes hereof as having been paid or delivered to the person in respect of which such deduction or withholding was made. The Corporation is hereby authorized to sell or otherwise dispose of all or any number of Series A Shares otherwise deliverable to a holder of Series B Shares on the conversion of such Series B Shares in order to meet any tax deduction or withholding tax requirements.
|
(ii)
|
Transfer Taxes
. For greater certainty, and notwithstanding any other provision of this Section II.1, the Corporation shall not be required to pay any tax which may be:
|
(A)
|
imposed upon the person or persons to whom Series A Shares are issued,
|
(B)
|
payable in respect of the issuance of such Series A Shares or a certificate therefor, or
|
(C)
|
payable in respect of any transfer involved in the issuance and delivery of any certificate in the name or names other than that of the holder of the Series B Shares,
|
|
in
connection with the conversion of Series B Shares into Series A Shares. The Corporation may refuse to issue any Series A Shares or deliver any such Series A Share certificate unless and until the person or persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation that such tax has been paid or is otherwise not required to be paid in the circumstances.
|
3. |
Name of the corporation(s) the articles of which are amended, if applicable
|
Name of Corporation
|
Corporation No.
|
|
Hydrogenics Corporation-Corporation Hydrogénique
|
2362376
|
|
Stuart Energy Systems Corporation
|
3793257
|
|
Hydrogenics Test Systems Inc.
|
3881105
|
|
7188501 Canada Inc.
|
7188501
|
9. |
Name of other corporations involved, if applicable
|
Name of Corporation
|
Corporation No. or Jurisdiction of Incorporation
|
|
7188501 Canada Inc.
|
7188501
|
|
Stuart Energy Systems Corporation
|
3793257
|
|
Hydrogenics Test Systems Inc.
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3881105
|
11.a |
The articles of the above named corporation(s) are amended in accordance with the attached plan of arrangement. In particular:
|
1. |
The articles of Hydrogenics Corporation - Corporation Hydrogénique are amended by deleting the Series A and Series B Preferred Shares and all rights, privileges, restrictions and conditions thereto.
|
2. |
The name of Hydrogenics Corporation - Corporation Hydrogénique is changed to Algonquin Power & Utilities Corp.
|
3. |
The name of Stuart Energy Systems Corporation is changed to 3793257 Canada Inc.
|
4. |
The name of Hydrogenics Test Systems Inc. is changed to 3881105 Canada Inc.
|
5. |
The name of 7188501 Canada Inc. is changed to Hydrogenics Corporation - Corporation Hydrogénique.
|
1.1 |
Definitions
|
1.2 |
Number of Hydrogenics Shares
|
1.3 |
Interpretation Not Affected by Headings, etc.
|
1.4 |
Rules of Construction
|
1.5 |
Currency
|
1.6 |
Date for any Action
|
1.7 |
References to Dates, Statutes, etc.
|
1.8 |
Time
|
2.1 |
Definitive Agreement
|
2.2 |
Effect of Filing Articles of Arrangement
|
2.3 |
Arrangement and Related Transactions
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(a) |
Hydrogenics shall transfer, assign and convey its entire legal and beneficial right, fide and interest in and to the Divested Assets in respect of Hydrogenics (the “
Hydrogenics Divested Assets
”)
to Newco and, as consideration for the Hydrogenics Divested Assets, Newco shall assume the Assumed Liabilities in respect of Hydrogenics and issue to Hydrogenics fully paid Newco Shares with a fair market value equal to the fair market Value of the Hydrogenics Divested Assets less the amount of the Assumed Liabilities in respect of Hydrogenics, all on the terms and conditions set forth in the Divestiture Agreement;
|
(b) |
Stuart Energy shall transfer, assign and convey its entire legal and beneficial right, title and interest in and to the Divested Assets in respect of Stuart Energy (the “
Stuart Energy Divested Assets
”) to Newco and, as consideration for the Stuart Energy Divested Assets, Newco shall assume the Assumed Liabilities in respect of Stuart Energy and issue to Stuart Energy fully paid Newco Shares with a fair market value equal to the fair market value of the Stuart Energy Divested Assets less the amount of the Assumed Liabilities in respect of Stuart Energy, all on the terms and conditions set forth in the Divestiture Agreement;
|
(c) |
Test Systems shall transfer, assign and convey its entire legal and beneficial right, title and interest in and to the Divested Assets in respect of Test Systems (the “
Test Systems Divested Assets
”) to Newco and, as consideration for the Test Systems Divested Assets, Newco shall assume the Assumed Liabilities in respect of Test Systems and issue to Test Systems fully paid Newco Shares with a fair market value equal to the fair market value of the Test Systems Divested Assets less the amount of the Assumed Liabilities in respect of Test Systems, all on the terms and conditions
set
forth in the Divestiture Agreement;
|
(d) |
Stuart Energy shall distribute all of its Newco Shares to Hydrogenics as a return of capital;
|
(e) |
Test Systems shall distribute all of its Newco Shares to Hydrogenics as a partial repayment of the indebtedness owing to Hydrogenics in an amount equal to the fair market value of such Newco Shares;
|
(f) |
Hydrogenics shall issue Hydrogenics Note 1, Hydrogenics Note 2 and Hydrogenics Note 3 to Newco as contributions to the capital of Newco;
|
(g) |
Newco shall adopt and be deemed to have adopted and implemented the Newco RSUP;
|
(h) |
the Hydrogenics RSUP shall be terminated and cancelled and each Hydrogenics RSU shall be terminated and cancelled in exchange for one Newco RSU, the value of which is based on one Newco Share on the same terms and conditions, mutatis mutandis, as the terminated and cancelled Hydrogenics RSU;
|
(i) |
Newco shall adopt and be deemed to have adopted and implemented the Newco DSUP;
|
(j) |
the Hydrogenics DSUP shall be terminated and cancelled and each Hydrogenics DSU shall be terminated and cancelled in exchange for one Newco DSU, the value of which is based on one Newco Share on the same terms and conditions, mutatis mutandis, as the terminated and cancelled Hydrogenics DSU;
|
(k) |
Newco shall adopt and be deemed to have adopted and implemented the Newco Option Plan;
|
(l) |
the Hydrogenics Option Plan shall be terminated and cancelled and each Hydrogenics Option to acquire one Hydrogenics Share shall be terminated and cancelled in exchange for one Newco Option, as the sole consideration, at an exercise price per Newco Share equal to the exercise price per Hydrogenics Share under the Hydrogenics Option so terminated and cancelled and having the same vesting date and expiry date as the Hydrogenics Option so terminated and cancelled, and the Newco Options so granted shall be otherwise deemed to have been granted under, and be subject to, the terms and conditions of the Newco Option Plan;
|
(m) |
the articles of Hydrogenics shall be amended to change its authorized capital as follows:
|
(i) |
by changing the designation of the Hydrogcnics Shares to “Redeemable Common Shares”, having the same rights, privileges, restrictions and conditions
as
the Hydrogenics Shares, but with each Hydrogenics Redeemable Share being redeemable at the option of Hydrogenics in consideration for one Newco Share;
|
(ii) |
by the creation of a new class of common shares (the “
New Algonquin Shares
”), being an unlimited number of shares designated as “Common Shares”, having the following rights, privileges, restrictions and conditions attaching thereto:
|
(A) |
Dividends
:
The holders of Common Shares and Redeemable Common Shares shall be entitled to receive dividends if, as and when declared by the Board of Directors of Hydrogenics on the Common Shares and Redeemable Common Shares, such dividends to be declared contemporaneously and paid at the same time in the same property and in equal amounts per share on all Common Shares and Redeemable Common Shares at the time outstanding without preference or priority of one share over another, subject to prior satisfaction of all preferential rights to dividends attached to all shares of other classes of shares of Hydrogenics ranking in priority to the Common Shares and Redeemable Common Shares in respect of dividends, if any;
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(B) |
Notice and Voting
:
Except for meetings of holders of a particular class or series of shares other than the Common Shares required by applicable laws to be held as a separate class or series meeting, the holders of Common Shares shall be entitled to receive notice of and to attend all meetings of shareholders of Hydrogenics, and at such meetings to vote, together with (except at meetings of holders of Common Shares required by applicable laws to be held as a separate class meeting) holders of Redeemable Common Shares on all matters submitted to a vote on the basis of one vote for each Common Share held; and
|
(C) |
Liquidation
:
In the event of any liquidation, dissolution or winding up of Hydrogenics, whether voluntary or involuntary, or any other distribution of the assets of Hydrogenics among its shareholders for the purpose of winding up its affairs, and subject to prior satisfaction of all preferential rights to return of capital on dissolution attached to all shares of other classes of shares of Hydrogenics ranking in priority to the Common Shares and Redeemable Common Shares, if any, the holders of Common Shares and Redeemable Common Shares shall be entitled, to share rateably, together with the shares of any other class of shares of Hydrogenics ranking equally with the Common Shares and Redeemable Common Shares in respect of return of capital on dissolution, in such assets of Hydrogenics as are available for distribution in equal amounts per share, without preference or priority of one share over another; and
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(iii) |
(A) the Preferred Shares and all rights, privileges, restrictions and conditions thereto, and (B) the Series A and Series B Preferred Shares and all rights, privileges, restrictions and conditions thereto, shall be deleted if requested in writing by the Board of Trustees, prior to the filing of the Articles of Arrangement;
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(n) |
Immediately following the Compulsory Acquisition by Hydrogenics pursuant to section 13.12A of the Algonquin Declaration of Trust, each outstanding Hydrogenics Redeemable Share shall be, and shall be deemed to be, redeemed by Hydrogenics, with payment of the redemption price therefor to
be
effected by the issuance of one Newco Share for each Hydrogenics Redeemable Share;
|
(o) |
the names of Hydrogenics, Stuart Energy and Test Systems shall be changed to “Algonquin Power Inc.”, “Algonquin Energy Systems Corporation” and “Algonquin Test Systems Inc.”, respectively, or such other names as may be requested in writing by the Board of Trustees, prior to the filing of the Articles of Arrangement, to Hydrogenics, Stuart Energy and Test Systems, and permitted by Hydrogenics, acting reasonably, and the Director;
|
(p) |
the name of Newco shall be changed to “Hydrogenics Corporation - Corporation Hydrogénique”;
|
(q) |
the number of directors of Hydrogenics shall be reduced from seven to four, and the incumbent directors of Hydrogenics shall, and shall be deemed to, have resigned and be replaced, as directors, by the trustees of Algonquin;
|
(r) |
the number of directors of Newco shall be increased from three to seven, and the resigning directors of Hydrogenics in subsection 2.3(q), shall, and shall be deemed to, be the directors of Newco;
|
(s) |
the initial auditors of Newco will be PricewaterhouseCoopers LLP, Who shall continue in office until the close of business of the first annual meeting of the holders of Newco Shares, and the directors of Newco are authorized to fix the remuneration of such auditors;
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(t) |
the auditors of Hydrogenics will be KPMG LLP, who shall continue in office until the close of business of the next annual meeting of the holders of New Algonquin Shares, and the directors of Hydrogenics are authorized to fix the remuneration of such auditors; and
|
(u) |
Hydrogenics will pay to Newco $10,813,084
in
full satisfaction of Hydrogenics Note 1.
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2.4 |
Effect of Redemptions and Exchanges
|
(a) |
each Hydrogenics Shareholder shall cease to be a holder of the Hydrogenics Shares and such holder’s name shall be removed from the register of holders of Hydrogenics Shares as of the Effective Date; and
|
(b) |
each Hydrogenics Shareholder whose Hydrogenics Shares are exchanged shall become a holder of the number of Newco Shares to which such holder is entitled as a result of such exchange and such holder’s name shall be added to the register of holders of Newco Shares as of the Effective Date.
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2.5 |
Effect of Transfer of Divested Assets and assumption of Assumed Liabilities
|
3.1 |
Rights of Hydrogenics Shareholders
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3.2 |
Rights
of
Other Hydrogenics Securityholders
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4.1 |
Amendments to Plan of Arrangement
|
(a) |
Hydrogenics may amend, modify and/or supplement this Plan of Arrangement at any time and from time to time prior to the Effective Time, provided that each such amendment, modification and/or supplement must be: (i) set out in writing; (ii) filed with the Court and, if made following the Meeting, approved by the Court; and (iii) communicated to Hydrogenics Shareholders if and as required by the Court.
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(b) |
Any amendment, modification or supplement to this Plan of Arrangement may be proposed by Hydrogenics at any time prior to or at the Meeting with or without any other prior notice or communication, and, if so proposed and accepted by the persons voting at the Meeting (other than as may be required under the Interim Order), shall become part of this Plan of Arrangement for all purposes.
|
(c) |
Any amendment, modification or supplement to this Plan of Arrangement that is approved by the Court following the Meeting shall be effective only, if required by the Court or applicable law, it is consented to by the Hydrogenics Shareholders voting in the manner directed by the Court.
|
(d) |
Any amendment, modification or supplement to this Plan of Arrangement may be made following the Effective Time but
shall
only be effective if it is consented to by each of Hydrogenics and Newco, provided that it concerns a matter which, in the reasonable opinion of Hydrogenics and Newco, is of an administrative nature required to better give effect to the implementation of this Plan of Arrangement and is not adverse to the financial or economic interests of Hydragenics, Newco or any former Hydrogenics Securityholder.
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5.1 |
Paramountcy and Releases
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5.2 |
Further Assurances
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(i)
|
with respect to Series A Preferred Shares, the greater of (i) an amount equal to $2.00 per Series A Preferred Share, together with all dividends accrued thereon and unpaid and accrued (the “Series A Minimum Purchase Price”); or (ii) such amount per Series A Preferred Share as would have been payable had all Preferred Shares been converted to Common Shares pursuant to the provisions of Section 2 immediately prior to such event of liquidation, dissolution or winding up; and
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(ii)
|
with respect to Series B Preferred Shares, the greater of (i) an amount equal to $10.50 per Series B Preferred Share, together with all dividends accrued thereon and unpaid and accrued (the “Series B Minimum Purchase Price”); or (ii) such amount per Series B Preferred Share as would have been payable had all Preferred Shares been converted to Common Shares pursuant to the provisions of Section 2 immediately prior to such event of liquidation, dissolution or winding up.
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(i)
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Each Series A Preferred Share shall be convened into that number of fully paid and non-assessable Common Shares determined by multiplying each such share by the ratio determined by dividing $2.00 by the Series A Conversion Price, determined as hereinafter provided, in effect at the time of conversion. The Series A Conversion Price at which Common Shares will be deliverable upon conversion of Series A Preferred Shares without the payment of any additional consideration by the holder thereof (the “Series A Conversion Price”) shall initially be $2.00 per Common Share.
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(ii)
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Each Series B Preferred Share shall be converted into that number of fully paid and non-assessable Common Shares determined by multiplying each such share by the ratio determined by dividing $10.50 by the Series B Conversion Price, determined as hereinafter provided, in effect at the time of conversion. The Series B Conversion Price at which Common Shares will be deliverable upon conversion of Series B Preferred Shares without the payment of any additional consideration by the holder thereof (the “Series B Conversion Price”) shall initially be $10.50 per Common Share.
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(i)
|
the closing of an offering or offerings pursuant to a receipted prospectus under the
Securities Act
(Ontario), as amended, or similar document filed under other applicable securities laws in Canada or the United States, covering the offer and sale of Common Shares for the account of the Corporation to the public in which:
|
(A)
|
the Common Shares are listed on a North American stock exchange or The NASDAQ Stock Market;
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(B)
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the net proceeds to the Corporation from such offering or offerings aggregate not less than $15 million; and
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(C)
|
the public offering price of which is not less than $15.00 per share adjusted to take into account of any dividend, combination of shares, or the like, or
|
(ii)
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the written election of the holders of greater than 50% of the then outstanding Preferred Shares to require such conversion.
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(i)
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Special Definitions
.
For purposes of this Subsection 2(e), the following definitions shall apply:
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(A)
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Common Shares issued or issuable upon conversion of Preferred Shares;
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(B)
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securities issued in connection with any stock split, stock dividend, combination of shares of the like;
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(C)
|
Common Shares issued or issuable to officers, directors or employees of, or consultants to, the Corporation pursuant to a stock purchase or option plan, or other similar arrangement approved by the Board of Directors, and consented to in accordance with the provisions of the Unanimous Shareholders’ Agreement; and
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(D)
|
that number of Common Shares, as is recommended by the Compensation Committee of the Corporation’s Board of Directors and approved by the Corporation’s Board of Directors, issued or issuable to officers, directors, or employees of, or consultants to, the Corporation at the discretion of the Board of Directors, and consented to in accordance with the provisions of the Unanimous Shareholders’ Agreement.
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(ii)
|
Issue of Securities Deemed to be Issue of Additional Common Shares
.
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(A)
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Options and Convertible Securities
.
In the event the Corporation at any time or from time to time after the Original Issue Date shall issue any Options or Convertible Securities or shall fix a record date for the determination of holders of any class of securities entitled to receive any such Options or Convertible Securities, then the maximum number of shares (as set forth in the instrument relating thereto without regard to any provisions contained therein for a subsequent adjustment of such number) of Common Shares issuable upon the exercise of such Options or, in the case of Convertible Securities and Options therefor, the conversion or exchange of such Convertible Securities, shall be deemed to be Additional Common Shares issued as of the time of such issue or, in case such a record date shall have been fixed, as of the close of business on such record date, provided that in any such case in which Additional Common Shares are deemed to be issued:
|
(1)
|
no further adjustment of the Conversion Price shall be made upon the subsequent issue of Convertible Securities or Common Shares upon the exercise of such Options or conversion or exchange of such Convertible Securities;
|
(2)
|
if such Options or Convertible Securities by their terms provide, with the passage of time or otherwise, for any increase in the Consideration (as defined in Subsection 2(e)(iv)) payable to the Corporation, or decrease in the number of Common Shares issuable, upon the exercise, conversion or exchange thereof, the Conversion Price computed upon the original issue thereof (or upon the occurrence of a record, date with respect thereto), and any subsequent adjustments based thereon, shall, upon any such
-
increase or decrease becoming effective, be recomputed to reflect such increase or decrease insofar as it affects such Options or the rights of conversion or exchange under such Convertible Securities;
|
(3)
|
upon the expiration of any such Options or any rights of conversion or exchange under such Convertible Securities which shall not have been exercised, the Conversion Price computed upon the original issue thereof (or upon the occurrence of a record date with respect thereto), and any subsequent adjustments based thereon, shall, upon such expiration, be recomputed as if:
|
(I)
|
in the case of the Convertible Securities or Options for Common Shares, the only Additional Common Shares issued were the Common Shares, if any, actually issued upon the exercise of such Options or the conversion or exchange of such Convertible Securities and the Consideration received therefor was the Consideration actually received by the Corporation for the issue of all such Options, whether or not exercised, plus the Consideration actually received by the Corporation upon such exercise, or for the issue of all such Convertible Securities which were actually converted or exchanged, plus the additional Consideration, if any, actually received by the Corporation upon such conversion or exchange; and
|
(II)
|
in the case of Options for Convertible Securities, only the Convertible Securities, if any, actually issued upon the exercise thereof were issued at the time of issue of such Options, and the Consideration received by the Corporation for the Additional Common Shares deemed to have been then issued was the Consideration actually received by the Corporation for the issue of all such Options, whether or not exercised, plus the Consideration deemed to have been received by the Corporation upon the issue of the Convertible Securities with respect to which such Options were actually exercised;
|
(4)
|
no readjustment pursuant to Clauses (2) or (3) above shall have the effect of increasing the Conversion Price to an amount which exceeds the lower of (i) the Conversion Price on the original adjustment date; or (ii) the Conversion Price that would have resulted from any issue of Additional Common Shares between the original adjustment date and such readjustment date;
|
(5)
|
in the case of any Options which expire by their terms not more than 30 days after the date of issue thereof, no adjustment of the Conversion Price shall be made until the expiration or exercise of all such Options, where upon such adjustment shall be made in the same manner provided in Clause (3) above; and
|
(6)
|
if such record date shall have been fixed and such Options or Convertible Securities are not issued on the date fixed therefor, the adjustment previously made in the Conversion Price which became effective on such record date shall be cancelled as of the close of business on such record date, and thereafter the Conversion Price shall be adjusted pursuant to this Subsection 2(e)(ii) as of the actual date of their issue.
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(B)
|
Stock Dividends, Stock Distribution and Subdivisions
.
In the event the Corporation at any time or from time to time after the Original Issue Date shall declare or pay any dividend or make any other distribution on the Common Shares payable in Common Shares or effect a subdivision of the outstanding Common Shares (by reclassification or otherwise other than by payment of a dividend in Common Shares), then and in any such event, Additional Common Shares shall be deemed to have been issued:
|
(1)
|
in the case of any such dividend or distribution, immediately after the close of business on the record date for the determination of holders of any class of securities entitled to receive such dividend or distribution; or
|
(2)
|
in the case of any such subdivision, at the close of business on the date immediately prior to the date upon which such corporate action becomes effective.
|
(iii)
|
Adjustment of the Conversion Price Upon Issue of Additional
Common
Shares
.
In the event that at any time or from time to time after the Original Issue Date, the Corporation
shall
issue Additional Common Shares (including, without limitation, Additional Common Shares deemed to be issued pursuant to Subsection 2(e)(ii)(A) but excluding Additional Common Shares deemed to be issued pursuant to Subsection 2(e)(ii)(B), which event is dealt with in Subsection 2(e)(v)(A)), without consideration or for a Consideration Per Share (as defined below) less than the Series A Conversion Price, with respect to Series A Preferred Shares, or Series B Conversion Price, with respect to Series B Preferred Shares, in effect on the date of and immediately prior to such issue, then and in such event, such Conversion Price shall be reduced, concurrently with such issue, to a price equal to the Consideration Per Share for which such Additional Common Shares are issued or deemed to be issued.
|
(iv)
|
Determination of Consideration
.
For purposes of this Subsection 2(e), the consideration (the “Consideration”) received or receivable by the Corporation for the issue of any Additional Common Shares shall be computed as follows:
|
(A)
|
Cash and Property
.
Such Consideration shall:
|
(1)
|
insofar as it consists of cash, be computed at the aggregate amounts of cash received or receivable by the Corporation excluding amounts paid or payable for accrued interest or accrued dividends;
|
(2)
|
insofar as it consists of property other than cash, be computed at the fair value thereof at the time of such issue, as determined in good faith by the Board of Directors, provided however, that if any holder of Preferred Shares disputes the fair market value computed by the Board of Directors, the fair market value shall be determined by a national chartered accountant firm selected by the Board of Directors with whom the Corporation has no dealings; and
|
(3)
|
in the event Additional Common Shares are issued together with other shares or securities or other assets of the Corporation for consideration which covers both, be the proportion of such consideration so received or receivable, computed as provided in Subsections 2(e)(iv)(A)(l) and (2) above, allocable to such Additional Common Shares as determined in good faith by the Board of Directors, provided however, that if any holder of Preferred Shares disputes the allocation determined by the Board of Directors, the allocation shall be determined by a national chartered accountant firm selected by the Board of Directors with whom the Corporation has no dealings.
|
(B)
|
Additional Common Shares other than Options and Convertible
Securities
.
The Consideration per share (the “Consideration Per Share”) for the issue of any Additional Common Shares other than Options and Convertible Securities shall be the Consideration for the issue of any Additional Common Shares other than Options or Convenible Securities, divided by the total number of such Additional Common Shares issued by the Corporation in exchange therefor.
|
(C)
|
Options and Convertible Securities
.
The Consideration per share (also the “Consideration Per Share”, as the context requires) for Additional Common Shares deemed to have been issued pursuant to Subsection 2(e)(ii)(A), relating to Options and Convertible Securities, shall be computed by dividing (x) the Consideration for the issue of such Options or Convertible Securities, plus the aggregate amount of additional consideration (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such Consideration), payable to the Corporation upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities, by (y) the number of Common Shares (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such number) issuable upon the exercise of such Options or the conversion or exchange of such Convertible Securities.
|
(v)
|
Adjustment of the Conversion Price for Dividends. Distributions. Subdivisions. Combinations or Consolidations of Common Shares
.
|
(A)
|
Stock Dividends, Distributions or Subdivisions
.
In the event the Corporation shall be deemed to have issued Additional Common Shares pursuant to Subsection 2(e)(ii)(B) in a stock dividend, stock distribution or subdivision, the Conversion Price in effect immediately before such deemed issue shall, concurrently with the effectiveness of such deemed issue, be proportionately decreased.
|
(B)
|
Combinations or Consolidations
.
In the event the outstanding shares of Common Shares shall be combined or consolidated, by reclassification or otherwise, into a lesser number of shares of Common Shares, the Conversion Price in effect immediately prior to such combination or consolidation shall, concurrently with the effectiveness of such combination or consolidation, be proportionately increased.
|
(i)
|
such adjustments and readjustments; and
|
(ii)
|
the number of Common Shares and the amount, if any, of other property which at the time would be received upon the conversion of each Preferred Share.
|
(i)
|
From and after the date that is the earlier of (a) five years after the Original Issue Date (as defined in section 2(e)) or (b) an event of non-compliance by the Corporation under the Unanimous Shareholders’ Agreement, each holder of Preferred Shares may elect to have the Corporation redeem from it, to the extent the Corporation has funds legally available for such purpose, and subject to Subsection 6(a)(iv), any or all Preferred Shares held by such holder. Such election may be made only by delivering to the Corporation within 60 days after the Corporation’s delivery to the holders of Preferred Shares of its year-end audited financial statements, or within 30 days after its delivery to such holders of its quarterly unaudited financial statements (a) a written notice signed by such holder specifying the number of Preferred Shares so to be redeemed, and (b) certificates for the Preferred Shares so to be redeemed, together with stock powers therefor duly executed by such holder in blank (such written election, certificates and stock powers being referred to collectively as a “Redemption Notice”).
|
(ii)
|
Subject to Subsection 6(a)(iii), within 10 days of receipt of a Redemption Notice, the Corporation shall deliver to each holder of Preferred Shares a notice containing a copy of each Redemption Notice it has received, and specifying the total funds legally available to the Corporation for redemption of all Preferred Shares outstanding at such time. Upon receipt of such notice from the Corporation, each holder of Preferred Shares who has not delivered a Redemption Notice shall have 20 days to deliver to the Corporation a written notice of its election to have the Corporation redeem from it, to the extent the Corporation has funds legally available for such purpose, and subject to Subsection 6(a)(iv), any or all Preferred Shares held by such holder (a “Participation Notice”). Such Participation Notice shall be in the form and shall contain the information and documents required to be contained in a Redemption Notice.
|
(iii)
|
Within 6 months of the expiration of the 20 day period referred to in Subsection 6(a)(ii), the Corporation shall redeem from each holder of Preferred Shares from whom the Corporation received a Redemption Notice or a Participation Notice, all the Preferred Shares as to which Redemption Notices or Participation Notices have been given, to the extent the Corporation has funds legally available for such purpose, and subject to Subsection 6(a)(iv), by paying to the respective holders an amount per Preferred Share equal to:
|
(A)
|
in the case of Series A Preferred Shares, the greater of (i) the number of Series A Preferred Shares to be redeemed held by the respective holders multiplied by the Series A Minimum Purchase Price; (ii) if there is a published market for the Common Shares, the “market price” as defined in the
Securities Act
(Ontario) of the Common Shares as at the end of the 20 day period referred to in Section 6(iii) multiplied by the number of Common Shares held by the respective holders had the Series A Preferred Shares to be redeemed held by the respective holders been converted into Common Shares pursuant to the provisions of Section 2 on such date; and (iii) if there is not a published market for the Common Shares, the Fair Market Value of the Common Shares held by the respective holders had the Preferred Shares to be redeemed held by the respective holders been converted into Common Shares pursuant to the provisions of Section 2 on such date; and
|
(B)
|
in the case of Series B Preferred Shares, the greater of (i) the number of Series B Preferred Shares to be redeemed held by the respective holders multiplied by the Series B Minimum Purchase Price; (ii) if there is a published market for the Common Shares, the “market price” as defined in the
Securities Act
(Ontario) of the Common Shares as at the end of the 20 day period referred to in Section 6(iii) multiplied by the number of Common Shares held by the respective holders had the Series B Preferred Shares to be redeemed held by the respective holders been converted into Common Shares pursuant to the provisions of Section 2 on such date; and (iii) if there is not a published market for the Common Shares, the Fair Market Value of the Common Shares held by the respective holders had the Preferred Shares to be redeemed held by the respective holders been converted into Common Shares pursuant to the provisions of Section 2 on such date.
|
(iv)
|
If the funds of the Corporation legally available for redemption of Preferred Shares are insufficient to redeem the total number of Preferred Shares submitted for redemption pursuant to Redemption Notices and any Participation Notices, those funds which are legally available will be split pro rata based on the aggregate value of Series A Preferred Shares and Series B Preferred Shares to be redeemed (based on the applicable minimum purchase price) into two pools of funds, one pool for Series A Preferred Share redemptions and one pool for Series B Preferred Share redemptions. Each pool will be used to redeem the maximum possible number of whole shares rateably among the holders of the applicable series of Preferred Shares who have submitted Redemption Notices or Participation Notices during the 20 day period referred to in Subsection 6(a)(ii), or which are subject to mandatory redemption. The Preferred Shares not redeemed shall remain outstanding and, notwithstanding anything herein to the contrary, shall remain entitled to all rights and preferences otherwise provided herein.
|
1.
|
The directors may appoint from time to time one or more directors within the limits provided in the
Canada Business Corporations Act.
|
2.
|
The directors are authorized to determine the number of directors of the Corporation from time to time by resolution.
|
(a)
|
The following terms shall have the meanings specified:
|
(i)
|
“Act” means the
Canada Business Corporations Act
or any statute which may be substituted therefor, as amended from time to time;
|
(ii)
|
“articles” means the original or restated articles of incorporation, articles of amendment, articles of amalgamation, articles of continuance, articles of arrangement, articles of dissolution, articles of reorganization or articles of revival of the Corporation and any amendments thereto;
|
(iii) |
“board” means the board of directors of the Corporation;
|
(iv) |
“director” means a member of the board;
|
(v) |
“electronic” means by facsimile, electronic mail, transmission of data or information through computer networks, any similar means or any other prescribed means; and
|
(vi) |
“meeting of shareholders” means an annual meeting of shareholders of the Corporation, or a special meeting of shareholders of the Corporation, or both, and includes a meeting of any class or series of any class of shareholders of the Corporation;
|
(b) |
Terms used herein that are defined in the Act shall have the meanings given to those terms in the Act; and
|
(c) |
Words importing the masculine gender shall include the feminine and neuter genders, and words importing the singular number shall include the plural number, and vice versa.
|
(a) |
borrow money upon credit of the Corporation;
|
(b) |
issue, reissue, sell or pledge debt obligations of the Corporation;
|
(c) |
to the extent permitted by the Act, give, directly or indirectly, financial assistance to any person by means of a loan, a guarantee to secure the performance of an obligation or otherwise;
|
(d) |
mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the Corporation, owned or subsequently acquired, to secure any obligation of the Corporation; and
|
(e) |
delegate to one or more directors or officers all or any of the powers conferred by the foregoing provisions to such extent and in such manner as the board shall determine at the time of such delegation.
|
(a) |
acted honestly and in good faith with a view to the best interests of the Corporation; and
|
(b) |
in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, had reasonable grounds for believing that his or her conduct was lawful.
|
Trust Indenture Act Section
|
Indenture Section
|
|
Section 310
|
(a)(1)
|
6.9
|
(a)(2)
|
6.9
|
|
(a)(3)
|
6.9
|
|
(a)(4)
|
Not Applicable
|
|
(a)(5)
|
6.9
|
|
(b)
|
6.8
|
|
6.10
|
||
Section 311
|
(a)
|
6.13
|
(b)
|
6.13
|
|
Section 312
|
(a)
|
7.1
|
7.2
|
||
(b)
|
7.2
|
|
(c)
|
7.2
|
|
Section 313
|
(a)
|
7.3
|
(b)
|
7.3
|
|
(c)
|
7.3
|
|
(d)
|
7.3
|
|
Section 314
|
(a)
|
7.4
|
(a)(4)
|
1.2
|
|
10.5
|
||
(b)
|
Not Applicable
|
|
(c)(1)
|
1.2
|
|
(c)(2)
|
1.2
|
|
(c)(3)
|
Not Applicable
|
|
(d)
|
Not Applicable
|
|
(e)
|
1.2
|
|
Section 315
|
(a)
|
6.1
|
(b)
|
6.2
|
|
(c)
|
6.1
|
|
(d)
|
6.1
|
|
(e)
|
5.14
|
|
Section 316
|
(a)
|
1.1
|
(a)(1)(A)
|
5.12
|
|
(a)(1)(B)
|
5.13
|
|
(a)(2)
|
Not Applicable
|
|
(b)
|
5.8
|
|
(c)
|
1.4
|
|
Section 317
|
(a)(1)
|
5.3
|
(a)(2)
|
5.4
|
|
(b)
|
10.4
|
|
Section 318
|
(a)
|
1.7
|
Page
|
|||
ARTICLE 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION |
1
|
||
1.1
|
Definitions
|
1
|
|
1.2
|
Compliance Certificates and Opinions
|
8
|
|
1.3
|
Form of Documents Delivered to Trustees
|
9
|
|
1.4
|
Acts of Holders; Record Dates
|
10
|
|
1.5
|
Notices, Etc., to the U.S. Trustee and the Corporation
|
12
|
|
1.6
|
Notice to Holders; Waiver
|
13
|
|
1.7
|
Conflict with Trust Indenture Legislation
|
13
|
|
1.8
|
Effect of Headings and Table of Contents
|
14
|
|
1.9
|
Successors and Assigns
|
14
|
|
1.10
|
Separability Clause
|
14
|
|
1.11
|
Benefits of Indenture
|
14
|
|
1.12
|
Governing Law; Waiver of Trial by Jury
|
14
|
|
1.13
|
Consent to Jurisdiction and Service of Process
|
15
|
|
1.14
|
Legal Holidays
|
15
|
|
1.15
|
Conversion of Currency
|
16
|
|
1.16
|
Currency Equivalent
|
17
|
|
1.17
|
No Security Interest Created
|
17
|
|
1.18
|
Currency
|
17
|
|
ARTICLE 2 SECURITY FORMS |
18
|
||
2.1
|
Forms Generally
|
18
|
|
2.2
|
Form of Legends
|
18
|
|
2.3
|
Form of U.S. Trustee’s Certificate of Authentication
|
19
|
|
ARTICLE 3 THE SECURITIES |
20
|
||
3.1
|
Amount Unlimited: Issuable in Series
|
20
|
|
3.2
|
Denominations
|
23
|
|
3.3
|
Execution, Authentication, Delivery and Dating
|
23
|
|
3.4
|
Temporary Securities
|
25
|
|
3.5
|
Registrar and Paying Agent
|
25
|
|
3.6
|
Transfer and Exchange of Global Securities
|
26
|
|
3.7
|
Mutilated, Destroyed, Lost and Stolen Securities
|
27
|
|
3.8
|
Payment of Interest; Interest Rights Preserved
|
28
|
|
3.9
|
Persons Deemed Owners
|
29
|
|
3.10
|
Cancellation
|
30
|
|
3.11
|
Computation of Interest
|
30
|
|
3.12
|
CUSIP Numbers, ISIN, etc.
|
30
|
|
ARTICLE 4 SATISFACTION AND DISCHARGE |
31
|
||
4.1
|
Satisfaction and Discharge
|
31
|
|
4.2
|
Application of Trust Money
|
32
|
ARTICLE 5 REMEDIES
|
32
|
||
5.1
|
Event of Default
|
32
|
|
5.2
|
Acceleration of Maturity; Rescission and Annulment
|
34
|
|
5.3
|
Collection of Indebtedness and Suits for Enforcement by Trustee
|
35
|
|
5.4
|
Trustees May File Proofs of Claim
|
35
|
|
5.5
|
Trustee May Enforce Claims Without Possession of Securities
|
36
|
|
5.6
|
Application of Money Collected
|
36
|
|
5.7
|
Limitation on Suits
|
36
|
|
5.8
|
Unconditional Right of Holders to Receive Principal, Premium, Additional Amounts and Interest
|
37
|
|
5.9
|
Restoration of Rights and Remedies
|
37
|
|
5.10
|
Rights and Remedies Cumulative
|
37
|
|
5.11
|
Delay or Omission Not Waiver
|
38
|
|
5.12
|
Control by Holders
|
38
|
|
5.13
|
Waiver of Past Defaults
|
38
|
|
5.14
|
Undertaking for Costs
|
39
|
|
5.15
|
Waiver of Stay or Extension Laws
|
39
|
|
ARTICLE 6 THE TRUSTEES |
39
|
||
6.1
|
Certain Duties and Responsibilities
|
39
|
|
6.2
|
Notice of Defaults
|
41
|
|
6.3
|
Certain Rights of Trustees
|
41
|
|
6.4
|
Not Responsible for Recitals or Issuance of Securities
|
43
|
|
6.5
|
May Hold Securities
|
43
|
|
6.6
|
Money Held in Trust
|
43
|
|
6.7
|
Compensation and Reimbursement
|
43
|
|
6.8
|
Conflicting Interests
|
44
|
|
6.9
|
Corporate Trustee Required; Eligibility
|
45
|
|
6.10
|
Resignation and Removal; Appointment of Successor
|
45
|
|
6.11
|
Acceptance of Appointment by Successor
|
47
|
|
6.12
|
Merger, Amalgamation, Conversion, Consolidation or Succession to Business
|
48
|
|
6.13
|
Preferential Collection of Claims Against Corporation
|
48
|
|
6.14
|
Appointment of Authenticating Agent
|
48
|
|
6.15
|
Third Party
|
50
|
|
6.16
|
Not Bound to Act
|
50
|
|
6.17
|
Privacy (Canadian Co-Trustee)
|
50
|
|
6.18
|
Joint Trustees
|
51
|
|
ARTICLE 7 HOLDERS’ LISTS AND REPORTS BY TRUSTEES, CORPORATION AND GUARANTOR |
51
|
||
7.1
|
Corporation to Furnish Names and Addresses of Holders
|
51
|
|
7.2
|
Preservation of Information; Communications to Holders
|
51
|
|
7.3
|
Reports by U.S. Trustee
|
52
|
|
7.4
|
Reports by Corporation
|
52
|
ARTICLE 8 CONSOLIDATION, AMALGAMATION, ARRANGEMENT, MERGER, CONVEYANCE OR TRANSFER |
53
|
||
8.1
|
Corporation May Consolidate, Etc., on Certain Terms
|
53
|
|
8.2
|
Successor Substituted
|
54
|
|
ARTICLE 9 SUPPLEMENTAL INDENTURES | 54 | ||
9.1
|
Supplemental Indentures Without Consent of Holders
|
54
|
|
9.2
|
Supplemental Indentures With Consent of Holders
|
55
|
|
9.3
|
Execution of Supplemental Indentures
|
56
|
|
9.4
|
Effect of Supplemental Indentures
|
57
|
|
9.5
|
Conformity with Trust Indenture Legislation
|
57
|
|
9.6
|
Reference in Securities to Supplemental Indentures
|
57
|
|
ARTICLE 10 COVENANTS |
57
|
||
10.1
|
Payment of Principal, Premium, Additional Amounts and Interest
|
57
|
|
10.2
|
Payment of Taxes
|
57
|
|
10.3
|
Maintenance of Office or Agency
|
61
|
|
10.4
|
Money for Securities Payments to Be Held in Trust
|
61
|
|
10.5
|
Statement by Officers as to Default
|
62
|
|
10.6
|
Company Existence
|
62
|
|
10.7
|
Waiver of Certain Covenants
|
63
|
|
ARTICLE 11 REDEMPTION OF SECURITIES |
63
|
||
11.1
|
Applicability of Article
|
63
|
|
11.2
|
Election to Redeem; Notice to U.S. Trustee
|
63
|
|
11.3
|
Selection by U.S. Trustee of Securities to Be Redeemed
|
64
|
|
11.4
|
Notice of Redemption
|
64
|
|
11.5
|
Securities Payable on Redemption Date
|
65
|
|
11.6
|
Securities Redeemed in Part
|
66
|
|
11.7
|
Tax Redemption
|
66
|
|
ARTICLE 12 DEFEASANCE OF COVENANT DEFEASANCE |
67
|
||
12.1
|
Applicability of Article
|
67
|
|
12.2
|
Defeasance and Discharge
|
67
|
|
12.3
|
Covenant Defeasance
|
68
|
|
12.4
|
Conditions to Defeasance or Covenant Defeasance
|
68
|
|
12.5
|
Deposited Money and Government Obligations to Be Held in Trust; Miscellaneous Provisions
|
69
|
|
12.6
|
Reinstatement
|
70
|
|
ARTICLE 13 IMMUNITY OF INCORPORATORS, SHAREHOLDERS, OFFICERS AND DIRECTORS | 70 | ||
13.1
|
Indenture and Securities Solely Corporate Obligations
|
70
|
|
ARTICLE 14 SUBORDINATION OF SECURITIES | 70 |
AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC
, as U.S. Trustee
|
||
By:
|
||
Authorized Signatory
|
||
[NAME OF AUTHENTICATING AGENT],
|
||
as Authenticating Agent
|
||
By:
|
|
|
By:
|
|
ALGONQUIN POWER & UTILITIES CORP.
|
||
By:
|
/s/ Ian Robertson
|
|
Name: Ian Robertson
|
||
Title: Chief Executive Officer
|
||
By:
|
/s/ David Bronicheski
|
|
Name: David Bronicheski
|
||
Title: Chief Financial Officer
|
||
AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC
, as U.S. Trustee
|
||
By:
|
/s/ Paul Kim
|
|
Name: Paul Kim
|
||
Title: Assistant General Counsel
|
||
AST TRUST COMPANY (CANADA)
,
as Canadian Co-Trustee
|
||
By:
|
/s/ Nelia Andrade
|
|
Name: Nelia Andrade
|
||
Title: Authorized signatory/signataire autorisé
|
||
By:
|
/s/ Marta Recinos
|
|
Name: Marta Recinos
|
||
Title: Authorized signatory/signataire autorisé
|
TABLE OF CONTENTS
|
||
ARTICLE 1
|
||
Interpretation
|
||
SECTION 1.1.
|
Definitions
|
1
|
SECTION 1.2.
|
Interpretation Not Affected By Headings, etc
|
6
|
SECTION 1.3.
|
Incorporation of Certain Definitions
|
6
|
SECTION 1.4.
|
Definition of “this Indenture”
|
6
|
ARTICLE 2
|
||
The Notes
|
||
SECTION 2.1.
|
Designation and Principal Amount
|
7
|
SECTION 2.2.
|
Terms of Notes
|
7
|
SECTION 2.3.
|
Form of Notes
|
8
|
SECTION 2.4.
|
Registrar and Transfer Agent, Paying Agent and Calculation Agent
|
8
|
SECTION 2.5.
|
Additional Amounts
|
8
|
ARTICLE 3
|
||
Redemption and Purchase for Cancellation of The Notes
|
||
SECTION 3.1.
|
Redemption of Notes at the Option of the Issuer
|
10
|
SECTION 3.2.
|
Notice to U.S. Trustee
|
10
|
SECTION 3.3.
|
Early Redemption upon a Tax Event
|
10
|
SECTION 3.4.
|
Early Redemption upon a Rating Event
|
10
|
SECTION 3.5.
|
Notice of Redemption
|
11
|
SECTION 3.6.
|
Purchase of the Notes for Cancellation
|
11
|
SECTION 3.7.
|
Applicability of Certain Redemption Provisions in Original Indenture
|
12
|
ARTICLE 4
|
||
Automatic Conversion
|
||
SECTION 4.1.
|
Automatic Conversion
|
12
|
SECTION 4.2.
|
Right Not to Deliver the Conversion Preferred Shares
|
12
|
ARTICLE 5
|
||
Deferral Right
|
||
SECTION 5.1.
|
Deferral Right
|
13
|
SECTION 5.2.
|
No Limit
|
13
|
SECTION 5.3.
|
Dividend Stopper Undertaking
|
13
|
ARTICLE 6
|
||
Subordination
|
||
SECTION 6.1.
|
Notes Subordinated to Senior Indebtedness
|
14
|
SECTION 6.2.
|
Disputes with Holders of Certain Senior Indebtedness
|
15
|
SECTION 6.3.
|
Subrogation
|
16
|
SECTION 6.4.
|
Obligation of Issuer Unconditional
|
16
|
SECTION 6.5.
|
Payments on Notes Permitted
|
16
|
SECTION 6.6.
|
Effectuation of Subordination by Trustees
|
17
|
SECTION 6.7.
|
Knowledge of Trustees
|
17
|
SECTION 6.8.
|
Trustees May Hold Senior Indebtedness
|
17
|
SECTION 6.9.
|
Rights of Holders of Senior Indebtedness Not Impaired
|
17
|
SECTION 6.10.
|
Article Applicable to Paying Agents
|
17
|
SECTION 6.11.
|
Trustee; Compensation Not Prejudiced
|
18
|
ARTICLE 7
|
||
Merger, Amalgamation, Consolidation, Sale, Lease or Conveyance
|
||
SECTION 7.1.
|
Merger, Amalgamation, Consolidation, Sale, Lease or Conveyance
|
18
|
ARTICLE 8
|
||
Additional Covenant
|
||
SECTION 8.1.
|
Additional Covenant
|
19
|
ARTICLE 9
|
||
Events of Default
|
||
SECTION 9.1.
|
Events of Default
|
19
|
ARTICLE 10
|
||
Amendment, Supplement and Waiver
|
||
SECTION 10.1.
|
Without the Consent of Holders
|
20
|
SECTION 10.2.
|
With the Consent of Holders
|
20
|
ARTICLE 11
|
||
Indenture Supplemental to Original Indenture
|
||
SECTION 11.1.
|
Indenture Supplemental to Original Indenture
|
22
|
ARTICLE 12
|
||
Acceptance of Trusts by Trustees
|
||
SECTION 12.1.
|
Acceptance of Trusts by Trustees
|
22
|
ARTICLE 13
|
||
Miscellaneous
|
||
SECTION 13.1.
|
Counterparts
|
22
|
SECTION 13.2.
|
Governing Law; Waiver of Trial by Jury
|
22
|
SECTION 13.3.
|
Consent to Jurisdiction and Service of Process
|
23
|
SECTION 13.4.
|
Benefits of Indenture
|
24
|
SECTION 13.5.
|
Severability
|
24
|
SECTION 13.6.
|
Successors and Assigns
|
24
|
ALGONQUIN POWER & UTILITIES CORP.
|
|||
By:
|
/s/ Ian Robertson
|
||
Name:
|
Ian Robertson
|
||
Title:
|
Chief Executive Officer
|
||
By:
|
/s/ David Bronicheski
|
||
Name:
|
David Bronicheski
|
||
Title:
|
Chief Financial Officer
|
||
AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC
|
|||
By:
|
/s/ Paul H. Kim | ||
Name: | Paul H. Kim | ||
Title: | Assistant General Counsel | ||
AST TRUST COMPANY (CANADA)
|
|||
By:
|
/s/ Nelia Andrade
|
||
Name:
|
Nelia Andrade
|
||
Title:
|
Authorized Signatory
|
||
By:
|
/s/ Marta Recinos
|
||
Name:
|
Marta Recinos
|
||
Title:
|
Authorized Signatory
|
ALGONQUIN POWER & UTILITIES CORP.
|
|||
By:
|
|||
Name:
|
Ian Robertson
|
||
Title:
|
Chief Executive Officer
|
||
By:
|
|||
Name:
|
David Bronicheski
|
||
Title:
|
Chief Financial Officer
|
AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC
|
||
as the U.S. Trustee and as the Authenticating Agent of the Canadian Trustee
|
||
By: | ||
(Authorized Signing Officer)
|
(Print or type assignee
’
s name, address and postal code)
|
Date:
|
Your Signature:
|
||
(Sign exactly as your name appears on the Notes)
|
|||
Signature Guarantee:
|
|||
(This signature must be guaranteed by a member of the Securities Transfer Association Medallion Program (STAMP), a member of the Stock Exchange Medallion Program (SEMP) or a member of the New York Stock Exchange Inc. Medallion Signature Program (MSP)).
|