Adjustment of Number of Units. The Subscription Receipts shall be subject to adjustment from time to time in the following circumstances and manner: (a) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Date, the Corporation shall: (i) subdivide, redivide or change its outstanding Common Shares into a greater number of shares; (ii) reduce, combine or consolidate its outstanding Common Shares into a smaller number of shares; or (iii) issue Common Shares or securities convertible into or exchangeable for Common Shares to the holders of all or substantially all of the outstanding Common Shares by way of a stock dividend or make a distribution to all or substantially all of the holders of Common Shares on its outstanding Common Shares payable in Common Shares or securities convertible into or exchangeable for Common Shares; then, in each such event, the number of Units issuable upon conversion of the Subscription Receipts shall be adjusted immediately after the effective date of such subdivision, redivision, change, reduction, combination or consolidation, or the record date for such issue of Common Shares by way of a stock dividend or distribution, as the case may be, by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction: (A) the numerator of which shall be the total number of Common Shares outstanding immediately after such date; and (B) the denominator of which shall be the total number of Common Shares outstanding immediately prior to such date. Such adjustment shall be made successively whenever any event referred to in this Section 7.1(a) shall occur. Any such issue or distribution of Common Shares or securities convertible into or exchangeable for Common Shares shall be deemed to have been made on the record date for such issue or distribution for the purpose of calculating the number of outstanding Common Shares under Section 7.1(b) and Section 7.1(c). (b) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Date, the Corporation shall fix a record date for the issuance of rights, options 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 into or exchangeable for Common Shares) at a price per share (or having a conversion or exchange price per share) less than 95% of the Current Market Price on such record date, the number of Units issuable upon conversion of the Subscription Receipts shall be adjusted immediately after such record date so that it shall equal the number determined by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction: (i) the numerator of which 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 (ii) the denominator of which 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. Any Common Shares owned by or held for the account of the Corporation or any Subsidiary shall be deemed not to be outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed. To the extent that any such rights, options or warrants are not exercised prior to the expiration thereof, the number of Units issuable upon conversion of the Subscription Receipts shall be readjusted to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect if such record date had not been fixed or to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect based upon the number of Common Shares (or securities convertible into or exchangeable for Common Shares) actually issued upon the exercise of such rights, options or warrants, as the case may be. (c) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Date, the Corporation shall fix a record date for the making of a distribution to all or substantially all the holders of its outstanding Common Shares of: (i) shares of the Corporation of any class other than Common Shares or other securities of the Corporation; (ii) rights, options or warrants to acquire Common Shares (or securities convertible into or exchangeable for Common Shares) or other securities of the Corporation; (iii) evidences of its indebtedness; or (iv) any property or other assets; (excluding, in each case, any distribution referred to in Section 7.1(a) or Section 7.1(b)) then, in each such case, the number of Units issuable upon conversion of the Subscription Receipts shall be adjusted immediately after such record date so that it shall equal the number determined by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction: (v) the numerator of which will be the product of the number of Common Shares outstanding on such record date and the Current Market Price on such record date; and (vi) the denominator of which will be: (A) the product of the number of Common Shares outstanding on such record date and the Current Market Price on such record date; less (B) the aggregate fair market value, as determined by the directors of the Corporation, acting reasonably, (whose determination, absent manifest error, will be conclusive), to the holders of Common Shares of such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets so distributed. Any Common Shares owned by or held for the account of the Corporation or any Subsidiary of the Corporation shall be deemed not to be outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed. To the extent that such distribution is not so made, the number of Units issuable upon conversion of the Subscription Receipts shall be readjusted to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect if such record date had not been fixed or to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect based upon such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets actually distributed, as the case may be. (d) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Date, there is a reclassification of the Common Shares or a capital reorganization of the Corporation (other than as described in Section 7.1(a), Section 7.1(b) or Section 7.1(c)) or an amalgamation, arrangement or merger of the Corporation with or into any other body corporate, trust, partnership 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 body corporate, trust, partnership or other entity, any Subscription Receiptholder who has not been deemed to have exercised the issuance rights prior to the effective date of such reclassification, reorganization, amalgamation, arrangement, merger, sale or conveyance shall, upon the exercise or deemed exercise of the Subscription Receipts, be entitled to receive and shall accept, in lieu of the number of Units to which the Subscription Receiptholder was prior thereto entitled upon any such exercise or deemed exercise, the kind and number of shares or other securities or property of the Corporation or of the body corporate, trust, partnership or other entity resulting from such reclassification, capital reorganization, amalgamation, arrangement or merger, or to which such sale or conveyance may be made, as the case may be, that such Subscription Receiptholder would have been entitled to receive on such reclassification, capital reorganization, amalgamation, arrangement, merger, sale or conveyance, if on the record date or the effective date thereof, as the case may be, the Subscription Receiptholder had been the registered holder of the number of Units to which, immediately before the transaction or event, the Subscription Receiptholder was entitled upon exercise or deemed exercise of the Subscription Receipts. To give effect to or to evidence the provisions of this Section 7.1(d), the Corporation, its successor, or such purchasing body corporate, partnership, trust or other entity, as the case may be, shall, prior to or contemporaneously with any such reclassification, capital reorganization, amalgamation, arrangement, merger, sale or conveyance, enter into an agreement which shall provide, to the extent possible, for the application of the provisions set out in this Agreement with respect to the rights and interests thereafter of the Subscription Receiptholder to the effect that the provisions set out in this Agreement shall thereafter correspondingly be made applicable, as nearly as may reasonably be possible, with respect to any shares, other securities or property to which a Subscription Receiptholder is entitled on the exercise or deemed exercise of the Subscription Receipts thereafter. Any agreement entered into between the Corporation and the Subscription Receipt Agent pursuant to the provisions of this Section 7.1(d) shall be a supplemental agreement entered into pursuant to the provisions of Article 10. Any agreement entered into between the Corporation, any successor to the Corporation or such purchasing body corporate, partnership, trust or other entity and the Subscription Receipt Agent shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided in this Section 7.1 and which shall apply to successive reclassifications, capital reorganizations, amalgamations, arrangements, mergers, sales or conveyances. (e) In any case in which this Section 7.1 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 any Subscription Receipt in respect of which the Subscription Receipts are deemed to have been exercised after such event, the additional Units or other securities or property issuable upon such exercise or deemed exercise as the case may be, by reason of the adjustment required by such event before giving effect to such adjustment; provided, however, that the Corporation shall deliver to such Subscription Receiptholder, as soon as reasonably practicable after such record date, an appropriate instrument evidencing such Subscription Receiptholder’s right to receive such additional Units or other securities or property upon the occurrence of the event requiring such adjustment and the right to receive any distributions made on such additional Units or other securities or property declared in favour of holders of record of Common Shares or securities or property on and after the relevant date of exercise or deemed exercise as the case may be, or such later date as such Subscription Receiptholder would, but for the provisions of this Section 7.1(e), have become the holder of record of such additional Units or other securities or property pursuant to this Section 7.1, provided that if the other securities are not securities of the Corporation, the Corporation will not be liable to any holder should the issuer thereof not pay any distribution declared thereon. (f) In any case in which Section 7.1(c) requires that an adjustment be made to the number of Units issuable upon conversion of the Subscription Receipts, no such adjustment shall be made if the Subscription Receipt Agent receives the shares, other securities, rights, options, warrants, evidences of indebtedness or other assets or property referred to in Section 7.1(c), in such kind and number as Subscription Receiptholders would have received if they had been holders of Units on the applicable record date or effective date, as the case may be, by virtue of their right to be issued Units upon conversion of the Subscription Receipts. Any such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets or property so received by the Subscription Receipt Agent shall be held and distributed by the Subscription Receipt Agent pursuant hereto. (g) The adjustments provided for in this Section 7.1 are cumulative and shall be computed to the nearest two decimal places and will apply to successive subdivisions, redivisions, reductions, combinations, consolidations, distributions, issues or other events resulting in any adjustment under the provisions of this Section 7.1, provided that, notwithstanding any other provision of this Section 7.1, no adjustment of the number of Units issuable upon conversion of the Subscription Receipts shall be required unless such adjustment would require an increase or decrease of at least one percent in the number of Units issuable upon conversion of the Subscription Receipts, provided, however, that any adjustments which by reason of this Section 7.1(g) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. (h) If the Corporation sets a record date to determine the holders of Common Shares for the purpose of entitling them to receive any dividend or distribution or sets a record date to take any other action and, thereafter and before the distribution to such shareholders of any such dividend or distribution or the taking of any other action, legally abandons its plan to pay or deliver such dividend or distribution or take such other action, then no adjustment shall be made to the number of Units issuable upon conversion of the Subscription Receipts. (i) After any adjustment pursuant to this Section 7.1, the term “Common Shares” where used in this Agreement shall be interpreted to mean securities of any class or classes which as a result of such adjustment and all prior adjustments pursuant to this Section 7.1, the Subscription Receiptholder is entitled to receive upon conversion of the Subscription Receipts, and the number of Units to be issued upon the conversion of the Subscription Receipts shall be interpreted to mean the number of Units or other property or securities a Subscription Receiptholder is entitled to receive, as a result of such adjustment and all prior adjustments pursuant to this Section 7.1, upon the full conversion of the Subscription Receipts, as the case may be.
Appears in 1 contract
Sources: Subscription Receipt Agreement
Adjustment of Number of Units. The Subscription Receipts conversion right attached to the Debentures shall be subject subject, under certain circumstances, to adjustment from time to time in the following circumstances and manneras follows:
(a1) Subject to Section 7.2, if If and whenever at any time from the Closing Date date hereof and prior to the Release DateConversion Time, the Corporation Company shall:
(ia) subdivide, redivide or change reclassify its outstanding Common Shares into a greater number of shares;; or
(iib) reduce, combine or consolidate its outstanding Common Shares into a smaller number of shares; or
(iii) issue Common Shares or securities convertible into or exchangeable for Common Shares to the holders of all or substantially all of the outstanding Common Shares by way of a stock dividend or make a distribution to all or substantially all of the holders number of Common Shares on its outstanding Common Shares payable in Common Shares or securities convertible into or exchangeable for Common Shares; then, in and Purchase Warrants comprising each such event, the number of Units issuable upon conversion of the Subscription Receipts Unit shall be adjusted immediately after the effective date of such subdivision, redivision, change, reduction, combination or consolidation, or the record date for such issue of Common Shares by way of a stock dividend or distribution, as the case may be, by multiplying the number of Units issuable upon conversion of Common Shares theretofore obtainable on the Subscription Receipts exercise thereof by a fraction:
(A) fraction of which the numerator of which shall be the total number of Common Shares outstanding immediately after such date; and
(B) date and the denominator of which shall be the total number of Common Shares outstanding immediately prior to such date. Such adjustment shall be made successively whenever any event referred to in this Section 7.1(a6.8(1) shall occur. Any such issue or distribution For greater certainty, the issuance of additional Common Shares or securities convertible into or exchangeable for Common Shares by the Company shall be deemed not result in any adjustment being made pursuant to have been made on the record date for such issue or distribution for the purpose of calculating the number of outstanding Common Shares under this Section 7.1(b) and Section 7.1(c)6.8.
(b2) Subject to Section 7.2, if If and whenever at any time from the Closing Date date hereof and prior to the Release Date, the Corporation shall fix a record date for the issuance of rights, options 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 into or exchangeable for Common Shares) at a price per share (or having a conversion or exchange price per share) less than 95% of the Current Market Price on such record date, the number of Units issuable upon conversion of the Subscription Receipts shall be adjusted immediately after such record date so that it shall equal the number determined by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction:
(i) the numerator of which 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
(ii) the denominator of which 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. Any Common Shares owned by or held for the account of the Corporation or any Subsidiary shall be deemed not to be outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed. To the extent that any such rights, options or warrants are not exercised prior to the expiration thereof, the number of Units issuable upon conversion of the Subscription Receipts shall be readjusted to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect if such record date had not been fixed or to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect based upon the number of Common Shares (or securities convertible into or exchangeable for Common Shares) actually issued upon the exercise of such rights, options or warrants, as the case may be.
(c) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Date, the Corporation shall fix a record date for the making of a distribution to all or substantially all the holders of its outstanding Common Shares of:
(i) shares of the Corporation of any class other than Common Shares or other securities of the Corporation;
(ii) rights, options or warrants to acquire Common Shares (or securities convertible into or exchangeable for Common Shares) or other securities of the Corporation;
(iii) evidences of its indebtedness; or
(iv) any property or other assets; (excluding, in each case, any distribution referred to in Section 7.1(a) or Section 7.1(b)) then, in each such case, the number of Units issuable upon conversion of the Subscription Receipts shall be adjusted immediately after such record date so that it shall equal the number determined by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction:
(v) the numerator of which will be the product of the number of Common Shares outstanding on such record date and the Current Market Price on such record date; and
(vi) the denominator of which will be:
(A) the product of the number of Common Shares outstanding on such record date and the Current Market Price on such record date; less
(B) the aggregate fair market value, as determined by the directors of the Corporation, acting reasonably, (whose determination, absent manifest error, will be conclusive), to the holders of Common Shares of such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets so distributed. Any Common Shares owned by or held for the account of the Corporation or any Subsidiary of the Corporation shall be deemed not to be outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed. To the extent that such distribution is not so made, the number of Units issuable upon conversion of the Subscription Receipts shall be readjusted to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect if such record date had not been fixed or to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect based upon such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets actually distributed, as the case may be.
(d) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Debenture Maturity Date, there is a reclassification of the Common Shares or a capital reorganization of the Corporation (Company other than as described in Section 7.1(a), Section 7.1(b6.8(1) or Section 7.1(c)) or an amalgamationa consolidation, arrangement amalgamation or merger of the Corporation Company with or into any other body corporate, trust, partnership or other entity, or a sale or conveyance of the property and assets of the Corporation Company as an entirety or substantially as an entirety to any other body corporate, trust, partnership or other entity, any Subscription Receiptholder Debentureholder who has not been deemed to have exercised the issuance rights its conversion right prior to the record date or effective date date, as the case may be, of such reclassification, reorganization, consolidation, amalgamation, arrangement, merger, sale or conveyance shallconveyance, upon the exercise or deemed exercise of the Subscription Receiptssuch right thereafter, shall be entitled to receive and shall accept, in lieu of the number of Units Common Shares and Purchase Warrants issuable on the exercise of such conversion right prior to which such record date or effective date, as the Subscription Receiptholder was prior thereto entitled upon any such exercise or deemed exercisecase may be, the kind and number of shares or other securities or property of the Corporation Company, any successor to the Company or of the any body corporate, trust, partnership or other entity resulting from such reclassificationmerger, capital reorganization, amalgamation, arrangement amalgamation or mergerconsolidation, or to which such sale or conveyance may be has been made, as the case may be, that such Subscription Receiptholder Debentureholder would have been entitled to receive on such reclassification, capital reorganization, consolidation, amalgamation, arrangement, merger, sale or conveyance, if if, on the record date or the effective date thereof, as the case may be, the Subscription Receiptholder Debentureholder had been the registered holder of the number of Units to which, immediately before Common Shares and Purchase Warrants issuable on the transaction or event, the Subscription Receiptholder was entitled upon exercise or deemed exercise of such conversion right prior to such record date or effective date, as the Subscription Receiptscase may be. To If determined appropriate by the Trustee to give effect to or to evidence the provisions of this Section 7.1(d6.8(2), the CorporationCompany, its successorany successor to the Company, or such purchasing body corporate, partnershiptrust, trust partnership 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, enter into an agreement indenture which shall provide, to the extent possible, for the application of the provisions set out forth in this Agreement Indenture with respect to the rights and interests thereafter of the Subscription Receiptholder Debentureholders to the effect end that the provisions set out forth in this Agreement Indenture shall thereafter correspondingly be made applicable, as nearly as may reasonably be possiblebe, with respect to any shares, other securities or property to which a Subscription Receiptholder Debentureholder is entitled on the exercise or deemed exercise of the Subscription Receipts its conversion rights thereafter. Any agreement indenture entered into between the Corporation Company and the Subscription Receipt Agent Trustee pursuant to the provisions of this Section 7.1(d6.8(2) shall be a supplemental agreement indenture entered into pursuant to the provisions of Article 10Section 9 hereof. Any agreement indenture entered into between the CorporationCompany, any successor to the Corporation Company or such purchasing body corporate, partnershiptrust, trust partnership or other entity and the Subscription Receipt Agent Trustee shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided in this Section 7.1 6.8 and which shall apply to successive reclassifications, capital reorganizations, amalgamations, arrangementsconsolidations, mergers, sales or conveyances.
(e3) If and whenever at any time from the date hereof and prior to the Debenture Maturity Date, the Company fixes a record date for the making of a distribution to all or substantially all the holders of its outstanding Common Shares or Purchase Warrants of dividends or any other distribution of, or in the form of, property or securities, including without limitation: (i) shares of any class; (ii) rights, options or warrants; (iii) evidences of its indebtedness; or (iv) assets, including shares of other corporations, any Debentureholder who has not exercised its conversion right prior to such record date, upon the exercise of such right thereafter, shall be entitled to receive, without further payment to the Company, and shall accept in addition to the number of Common Shares and Purchase Warrants to which it was theretofore entitled upon such exercise, the kind and amount of shares and other securities or property which such holder would have been entitled to receive as a result of such distribution, if, on the record date it had been the registered holder of the number of Common Shares and Purchase Warrants to which it was theretofore entitled upon exercise.
(4) In any case in which this Section 7.1 6.8 shall require that an adjustment shall become effective immediately after a record date for an event referred to herein herein, the Corporation Company may defer, until the occurrence of such event, issuing to the holder Holder of any Subscription Receipt in respect Debenture exercising his conversion rights after such record date and before the occurrence of which the Subscription Receipts are deemed to have been exercised after such event, the additional Units Common Shares and Purchase Warrants or other securities or property issuable upon such exercise or deemed exercise as the case may be, by reason of the adjustment required by such event before giving effect to such adjustmentevent; provided, however, that the Corporation Company shall deliver to such Subscription Receiptholder, as soon as reasonably practicable after such record date, Holder an appropriate instrument evidencing such Subscription Receiptholder’s Holder's right to receive such additional Units Common Shares and Purchase Warrants or other securities or property upon the occurrence of the event requiring such adjustment and the right to receive any distributions made on such additional Units or other securities or property Common Shares and Purchase Warrants declared in favour of holders of record of Common Shares or securities or property and Purchase Warrants on and after the relevant date of exercise or deemed exercise as the case may be, or such later date as such Subscription Receiptholder would, Holder would but for the provisions of this Section 7.1(e6.8(4), have become the holder of record of such additional Units or other securities or property pursuant to this Section 7.1, provided that if the other securities are not securities of the Corporation, the Corporation will not be liable to any holder should the issuer thereof not pay any distribution declared thereonCommon Shares and Purchase Warrants.
(f) In any case in which Section 7.1(c) requires that an adjustment be made to the number of Units issuable upon conversion of the Subscription Receipts, no such adjustment shall be made if the Subscription Receipt Agent receives the shares, other securities, rights, options, warrants, evidences of indebtedness or other assets or property referred to in Section 7.1(c), in such kind and number as Subscription Receiptholders would have received if they had been holders of Units on the applicable record date or effective date, as the case may be, by virtue of their right to be issued Units upon conversion of the Subscription Receipts. Any such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets or property so received by the Subscription Receipt Agent shall be held and distributed by the Subscription Receipt Agent pursuant hereto.
(g5) The adjustments provided for in this Section 7.1 6.8 are cumulative and shall be computed to the nearest two decimal places and will apply to successive subdivisions, redivisions, reductions, combinations, consolidations, distributions, issues or other events resulting in any adjustment under the provisions of this Section 7.1, provided that, notwithstanding any other provision of this Section 7.1, no adjustment of the number of Units issuable upon conversion of the Subscription Receipts shall be required unless such adjustment would require an increase or decrease of at least one percent in the number of Units issuable upon conversion of the Subscription Receipts, provided, however, that any adjustments which by reason of this Section 7.1(g) are not required to be made shall be carried forward and taken into account in any subsequent adjustment.
(h) If the Corporation sets a record date to determine the holders of Common Shares for the purpose of entitling them to receive any dividend or distribution or sets a record date to take any other action and, thereafter and before the distribution to such shareholders of any such dividend or distribution or the taking of any other action, legally abandons its plan to pay or deliver such dividend or distribution or take such other action, then no adjustment shall be made to the number of Units issuable upon conversion of the Subscription Receipts.
(i) cumulative. After any adjustment pursuant to this Section 7.16.8, the term “"Common Shares” " and "Purchase Warrants" where used in this Agreement Indenture shall be interpreted to mean securities of any class or classes which which, as a result of such adjustment and all prior adjustments pursuant to this Section 7.16.8, the Subscription Receiptholder Debentureholder is entitled to receive upon the exercise of his conversion of the Subscription Receiptsright, and the number of Units to be issued upon the Common Shares and Purchase Warrants indicated in any instrument of conversion of the Subscription Receipts shall be interpreted to mean the number of Units Common Shares and Purchase Warrants or other property or securities a Subscription Receiptholder Debentureholder is entitled to receive, as a result of such adjustment and all prior adjustments pursuant to this Section 7.1, upon the full conversion of the Subscription Receipts, as the case may be6.8.
Appears in 1 contract
Sources: Indenture (Seven Seas Petroleum Inc)
Adjustment of Number of Units. The acquisition rights in effect at any date attaching to the Subscription Receipts shall be subject to adjustment from time to time in the following circumstances and manneras follows:
(a) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to until the Release DateTime of Expiry, the Corporation Company shall:
(i) subdivide, redivide or change its outstanding Common Shares into a greater number of shares;
(ii) reduce, combine or consolidate its outstanding Common Shares into a smaller number of shares; or;
(iii) issue Common Shares or securities convertible into or exchangeable for Common Shares to the holders of all or substantially all of the outstanding Common Shares by way of a stock dividend or make a distribution to all or substantially all of the holders of the Common Shares on its outstanding Common Shares payable in Shares, by way of stock distribution, stock dividend or otherwise, Common Shares or securities convertible into or exchangeable for Common Shares; then, in each such event, the number of Units issuable upon conversion (any of the Subscription Receipts events described in , and being referred to as a “Share Reorganization”); the Exchange Ratio shall be adjusted immediately after the effective record date at which the holders of the Common Shares are determined for the purpose of such subdivision, redivision, change, reduction, combination or consolidation, or Share Reorganization by multiplying the Exchange Ratio in effect on the record date for such issue of Common Shares by way of a stock dividend or distribution, as the case may be, by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction:
(A) fraction of which the numerator of which shall be the total number of Common Shares outstanding immediately after such date; and
(B) giving effect to the Share Reorganization and the denominator of which shall be the total number of Common Shares outstanding immediately prior to such date. Such adjustment shall be made successively whenever any event referred to in this Section 7.1(a) subsection shall occur. Any such issue or distribution of Common Shares or securities convertible into or exchangeable for Common Shares shall be deemed to have been made on the record date for such issue or distribution for the purpose of calculating the number of outstanding Common Shares under Section 7.1(b) and Section 7.1(c).;
(b) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Date, the Corporation shall fix a record date for the issuance Time of rights, options 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 into or exchangeable for Common Shares) at a price per share (or having a conversion or exchange price per share) less than 95% of the Current Market Price on such record date, the number of Units issuable upon conversion of the Subscription Receipts shall be adjusted immediately after such record date so that it shall equal the number determined by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction:
(i) the numerator of which 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
(ii) the denominator of which 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. Any Common Shares owned by or held for the account of the Corporation or any Subsidiary shall be deemed not to be outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed. To the extent that any such rights, options or warrants are not exercised prior to the expiration thereof, the number of Units issuable upon conversion of the Subscription Receipts shall be readjusted to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect if such record date had not been fixed or to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect based upon the number of Common Shares (or securities convertible into or exchangeable for Common Shares) actually issued upon the exercise of such rights, options or warrants, as the case may be.
(c) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release Date, the Corporation shall fix a record date for the making of a distribution to all or substantially all the holders of its outstanding Common Shares of:
(i) shares of the Corporation of any class other than Common Shares or other securities of the Corporation;
(ii) rights, options or warrants to acquire Common Shares (or securities convertible into or exchangeable for Common Shares) or other securities of the Corporation;
(iii) evidences of its indebtedness; or
(iv) any property or other assets; (excluding, in each case, any distribution referred to in Section 7.1(a) or Section 7.1(b)) then, in each such case, the number of Units issuable upon conversion of the Subscription Receipts shall be adjusted immediately after such record date so that it shall equal the number determined by multiplying the number of Units issuable upon conversion of the Subscription Receipts by a fraction:
(v) the numerator of which will be the product of the number of Common Shares outstanding on such record date and the Current Market Price on such record date; and
(vi) the denominator of which will be:
(A) the product of the number of Common Shares outstanding on such record date and the Current Market Price on such record date; less
(B) the aggregate fair market value, as determined by the directors of the Corporation, acting reasonably, (whose determination, absent manifest error, will be conclusive), to the holders of Common Shares of such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets so distributed. Any Common Shares owned by or held for the account of the Corporation or any Subsidiary of the Corporation shall be deemed not to be outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed. To the extent that such distribution is not so made, the number of Units issuable upon conversion of the Subscription Receipts shall be readjusted to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect if such record date had not been fixed or to the number of Units issuable upon conversion of the Subscription Receipts which would then be in effect based upon such shares, other securities, rights, options, warrants, evidences of indebtedness or other assets actually distributed, as the case may be.
(d) Subject to Section 7.2, if and whenever at any time from the Closing Date and prior to the Release DateExpiry, there is a reclassification of the Common Shares or a capital reorganization of the Corporation (Company other than as described in Section 7.1(a)subsection or a consolidation, Section 7.1(b) or Section 7.1(c)) or an amalgamation, arrangement amalgamation or merger of the Corporation Company with or into any other body corporate, trust, partnership or other entity, or a sale or conveyance of the property and assets of the Corporation Company as an entirety or substantially as an entirety to any other body corporate, trust, partnership or other entity, entity (any Subscription Receiptholder who has not been deemed to have exercised the issuance rights prior to the effective date of such reclassification, reorganization, amalgamation, arrangement, merger, sale or conveyance shallevent being called a “Capital Reorganization”), upon the exercise or deemed exercise conversion of the Subscription Receiptssuch right thereafter, shall be entitled to receive and shall accept, in lieu of the number of Units to which the such Subscription Receiptholder was prior thereto would otherwise be entitled upon any such exercise or deemed exerciseto acquire, the kind and number of shares Units or other securities or property of the Corporation Company or of the body corporate, trust, partnership or other entity resulting from such reclassification, capital reorganization, amalgamation, arrangement or mergerCapital Reorganization, or to which such sale or conveyance may be made, as the case may be, that such Subscription Receiptholder would have been entitled to receive on such reclassificationCapital Reorganization, capital reorganizationif, amalgamation, arrangement, merger, sale or conveyance, if on the record date or the effective date thereof, as the case may be, the Subscription Receiptholder had been the registered holder of the number of Units Common Shares sought to which, immediately before be acquired by it. If determined appropriate by the transaction Company or event, the Subscription Receiptholder was entitled upon exercise or deemed exercise of the Subscription Receipts. To Agent to give effect to or to evidence the provisions of this Section 7.1(d)subsection or as required pursuant to an extraordinary resolution of the Subscription Receiptholders, the CorporationCompany, its successor, or such purchasing body corporate, partnership, trust or other entity, as the case may be, shall, prior to or contemporaneously with any such reclassification, capital reorganization, amalgamation, arrangement, merger, sale or conveyanceCapital Reorganization, enter into an agreement which shall provide, to the extent possible, for the application of the provisions set out forth in this Agreement with respect to the rights and interests thereafter of the Subscription Receiptholder Receiptholders to the effect end that the provisions set out forth in this Agreement shall thereafter correspondingly be made applicable, as nearly as may reasonably be possiblebe, with respect to any shares, other securities or property to which a Subscription Receiptholder is entitled on the exercise or deemed exercise of the Subscription Receipts its acquisition rights thereafter. Any agreement entered into between the Corporation Company, the Agent and the Subscription Receipt Agent pursuant to the provisions of this Section 7.1(d) subsection shall be a supplemental agreement entered into pursuant to the provisions of Article 10hereof. Any agreement entered into between the CorporationCompany, any successor to the Corporation Company or such purchasing body corporate, partnership, trust or other entity and the Subscription Receipt Agent shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided in this Section 7.1 and which shall apply to successive reclassificationsreclassification, capital reorganizations, amalgamations, arrangementsconsolidations, mergers, sales or conveyances.;
(ec) In if and whenever at any case time from the Closing Date and prior to the Time of Expiry, the Company shall issue rights, options or warrants to all or substantially all the holders of the Common Shares pursuant to which those holders are entitled to subscribe for, purchase or otherwise acquire Common Shares or Convertible Securities within a period of 45 days from the date of issue thereof at a price, or at a conversion price, of less than 95% of the Current Market Price at the record date for such distribution (any such issuance being herein called a “Rights Offering” and Common Shares that may be acquired in which this Section 7.1 exercise of the Rights Offering or upon conversion of the Convertible Securities offered by the Rights Offering being herein called the “Offered Shares”), the Exchange Ratio shall require that an adjustment shall become be adjusted effective immediately after the record date at which holders of Common Shares are determined for the purposes of the Rights Offering to an Exchange Ratio that is the product of (1) the Exchange Ratio in effect on the record date and (2) a fraction (a) the numerator of which shall be the sum of (i) the number of Common Shares outstanding on the record date for an event referred to herein the Corporation may defer, until rights offering plus (ii) the occurrence number of such event, issuing Offered Shares offered pursuant to the holder Rights Offering or the maximum number of any Subscription Receipt in respect Offered Shares into which the Convertible Securities so offered pursuant to the Rights Offering may be converted, as the case may be; and (b) the denominator of which shall be the Subscription Receipts sum of (i) the number of Common Shares outstanding on the record date for the Rights Offering; and (ii) the number arrived at when (A) either the product of (1) the number of Offered Shares so offered and (2) the price at which those Common Shares are deemed offered, or the product of (3) the conversion price thereof and (4) the maximum number of Offered Shares for or into which the Convertible Securities so offered pursuant to have been exercised after such eventthe Rights Offering may be converted, the additional Units or other securities or property issuable upon such exercise or deemed exercise as the case may be, is divided by reason (B) the Current Market Price of the adjustment required by such event before giving effect to such adjustment; provided, however, that Common Shares on the Corporation shall deliver to such Subscription Receiptholder, as soon as reasonably practicable after such record date. Any Offered Shares owned by or held for the account of the Company shall be deemed not to be outstanding for the purpose of any computation; if all the rights, an appropriate instrument evidencing such Subscription Receiptholder’s right options or warrants are not so issued or if all rights, options or warrants are not exercised prior to receive such additional Units or other securities or property the expiration thereof, the Exchange Ratio shall be readjusted to the Exchange Ratio in effect immediately prior to the record date and the Exchange Ratio shall be further adjusted based upon the occurrence number of Offered Shares (or Convertible Securities into Offered Shares) actually delivered upon the exercise of the event requiring such adjustment and the right to receive any distributions made on such additional Units rights, options or other securities or property declared in favour of holders of record of Common Shares or securities or property on and after the relevant date of exercise or deemed exercise warrants, as the case may be, but subject to any other adjustment required hereunder by reason of any event arising after that record date;
(d) if and whenever at any time from the Closing Date and prior to the Time of Expiry, the Company shall issue or distribute to all or substantially all the holders of the Common Shares (i) shares of any class other than Common Shares, or (ii) rights, options or warrants other than rights, options or warrants convertible within 45 days from the date of issue thereof at a price, or at a conversion price, of at least 90% of the Current Market Price at the record date for such later date as such Subscription Receiptholder woulddistribution, but for the provisions or (iii) evidences of this Section 7.1(eindebtedness, or (iv) any other assets and that issuance or distribution does not constitute a Share Reorganization or a Rights Offering (any of those events being herein called a “Special Distribution”), have become the holder Exchange Ratio shall be adjusted effective immediately after the record date at which the holders of record of such additional Units or other securities or property pursuant to this Section 7.1, provided that if the other securities Common Shares are not securities determined for purposes of the Corporation, Special Distribution to an Exchange Ratio that is the Corporation will not product of (1) the Exchange Ratio in effect on the record date and (2) a fraction (a) the numerator of which shall be liable to any holder should the issuer thereof not pay any distribution declared thereon.
product of (fi) In any case in which Section 7.1(c) requires that an adjustment be made to the sum of the number of Common Shares outstanding on the record date plus the number of Units issuable which the Subscription Receiptholders would be entitled to receive upon conversion of all their outstanding Subscription Receipts if they were converted on the record date and (ii) the Current Market Price thereof on that date; and (b) the denominator of which shall be the product of (A) the sum of the number of Common Shares outstanding on the record date plus the number of Units which the Subscription ReceiptsReceiptholders would be entitled to receive upon conversion of all their outstanding Subscription Receipts if they were converted on the record date and (B) the Current Market Price thereof on that date, no such adjustment shall less, the aggregate fair market value, as determined by the directors, whose determination shall, subject to TSX acceptance (if applicable) and absent manifest error, be made if the Subscription Receipt Agent receives conclusive, of the shares, other securities, rights, options, warrants, evidences of indebtedness or other assets issued or property referred to distributed in Section 7.1(c), in such kind and number as Subscription Receiptholders would have received if they had been holders the Special Distribution. Any Common Shares owned by or held for the account of Units on the applicable record date or effective date, as the case may be, by virtue of their right Company shall be deemed not to be issued Units upon conversion outstanding for the purpose of any such computation. To the Subscription Receipts. Any such extent that the distribution of shares, other securities, rights, options, warrants, evidences of indebtedness or other assets if not so made or property to the extent that any rights, options or warrants so received by distributed are not exercised, the Subscription Receipt Agent Exchange Ratio shall be held and readjusted to the Exchange Ratio that would then be in effect based upon the shares, rights, options, warrants, evidences of indebtedness or assets actually distributed or based upon the number of Common Shares or convertible securities actually delivered upon the exercise of the rights, options or warrants, as the case may be, but subject to any other adjustment required hereunder by reason of any event arising after the Subscription Receipt Agent pursuant hereto.record date;
(ge) The the adjustments provided for in this Section 7.1 in the number of Units and classes of securities which are to be received on the conversion of Subscription Receipts are cumulative and shall be computed to the nearest two decimal places and will apply to successive issues, subdivisions, redivisions, reductions, combinations, consolidations, distributions, issues or distributions and any other events resulting in any adjustment under the provisions of this Section 7.1, provided that, notwithstanding any other provision of this Section 7.1, no that would require an adjustment of the number of Units issuable upon conversion of the Subscription Receipts shall be required unless such adjustment would require an increase or decrease of at least one percent in the number of Units issuable upon conversion of the Subscription Receipts, provided, however, that any adjustments which by reason of this Section 7.1(g) are not required to be made shall be carried forward and taken into account in any subsequent adjustment.
(h) If the Corporation sets a record date to determine the holders of Common Shares for the purpose of entitling them to receive any dividend or distribution or sets a record date to take any other action and, thereafter and before the distribution to such shareholders of any such dividend or distribution Exchange Ratio or the taking of any other action, legally abandons its plan to pay or deliver such dividend or distribution or take such other action, then no adjustment shall be made to the number of Units kind securities issuable upon conversion of the Subscription Receipts.
(i) hereunder. After any adjustment pursuant to this Section 7.1Section, the term “Common Shares” where used in this Agreement shall be interpreted to mean securities of any class or classes which which, as a result of such adjustment and all prior adjustments pursuant to this Section 7.1Section, the Subscription Receiptholder is entitled to receive upon the conversion of the its Subscription ReceiptsReceipt, and the number of Units Common Shares indicated by any conversion made pursuant to be issued upon the conversion of the a Subscription Receipts Receipt shall be interpreted to mean the number of Units Common Shares or other property or securities a Subscription Receiptholder is entitled to receive, as a result of such adjustment and all prior adjustments pursuant to this Section 7.1Section, upon the full conversion of a Subscription Receipt;
(f) if, and whenever at any time from the Closing Date and prior to the Time of Expiry, the Company shall reclassify or otherwise change the outstanding Common Shares, the conversion right shall be adjusted effective immediately upon the reclassification becoming effective so that holders of Subscription Receipts who convert their rights thereafter shall be entitled to receive Units (or Common Shares and Warrants comprising Units) as they would have received had the Subscription ReceiptsReceipts been converted immediately prior to the effective date, subject to adjustment thereafter in accordance with provisions the same, as the case nearly as may bebe possible, as those contained in this .
Appears in 1 contract
Sources: Subscription Receipt Agreement (Response Biomedical Corp)