<PAGE>
Registration No. ___-_____
As filed with the Securities and Exchange Commission on December 1, 1999
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ST. LAURENT PAPERBOARD INC.
-----------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
Canada 98-0168682
(Jurisdiction of Incorporation) (I.R.S. Employer
Identification No.)
630 Rene-Levesque Boulevard, West
Suite 3000
Montreal, Quebec H3B 5C7
(Address of Principal Executive Offices)
St. Laurent Paperboard Inc. Managers' Stock Option Plan
St. Laurent Paperboard Inc. Managers' Share Purchase Plan
St. Laurent Paperboard Inc. Long-Term Incentive Plan
St. Laurent Paperboard Inc. Directors' Stock Option and Share Purchase Plan
(Full titles of the Plans)
CT Corporation System
2 Olive Street
Boston, MA 02109
(617)-482-4420
(Name, Address and Telephone Number of Agent for Service)
Copies of all communications to:
David A. Garbus, Esq.
ROBINSON & COLE LLP
One Boston Place
Boston, Massachusetts 02108-4404
Telephone: 617-557-5900
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
================================================================================================================================
CALCULATION OF REGISTRATION FEE
================================================================================================================================
Maximum Proposed Maximum Proposed Maximum Amount of
Title of Securities to be Amount to be Offering Price Aggregate Registration Fee
Registered Registered (1) Per Share Offering Price (2) (3)
================================= ======================= ======================= ====================== =======================
Common Shares 2,162,717 $12.125 $26,222,944 $7,290.00
================================= ======================= ======================= ====================== =======================
TOTAL 2,162,717 shs. $12.125 $26,222,944 $7,290.00
================================================================================================================================
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plans described herein.
(2) Estimated in accordance with Rule 457(h) under the Securities Act solely for
the purpose of calculating the registration fee based upon the average of the
last reported sale price of the Company's Common Stock as reported on the New
York Stock Exchange on November 29, 1999.
(3) Amount of Registration Fee was calculated assuming, based upon the terms
of the plans, that 500,000 shares may be issued upon exercise of the options
under the St. Laurent Paperboard Inc. Managers' Stock Option Plan, a total of
300,000 shares may be purchased under the St. Laurent Paperboard Inc. Managers'
Share Purchase Plan, 1,031,684 shares may be issued upon the exercise of options
and 156,033 shares may be purchased under the St. Laurent Paperboard Inc. Long-
Term Incentive Plan, and 175,000 shares may be purchased under the St. Laurent
Paperboard Inc. Directors Stock Option and Share Purchase Plan.
<PAGE>
PART I.
INFORMATION REQUIRED IN THE SECTION 10 PROSPECTUS
Item 1. Plan Information.
Omitted in accordance with Rule 428 under the Securities Act and the Note to
Part I of Form S-8.
Item 2. Registrant Information and Employee Plan Annual Information.
Omitted in accordance with Rule 428 under the Securities Act and the Note to
Part I of Form S-8.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
There are hereby incorporated by reference in this Registration Statement the
following documents and information heretofore filed with the Securities and
Exchange Commission:
1. The Registration Statement of St. Laurent Paperboard Inc. (the "Company") on
Form 40-F filed on June 8, 1998, as amended by amendments filed on July 29,
1998, September 4, 1998, November 6, 1998, June 8, 1999 and June 25, 1999,
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (File No. 001-14834).
2. All other reports filed by the Company pursuant to Section 13(a) or 15(d) of
the Exchange Act since June 25, 1999.
3. The description of the Company's Common Shares, as contained in the
Registration Statement of the Company on Form 40-F.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act on or after the date of this Registration
Statement and prior to the filing of a post-effective amendment which indicates
that all securities offered have been sold or which deregisters all securities
then remaining unsold shall be deemed to be incorporated by reference in this
Registration Statement and to be part hereof from the date of filing of such
documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Article V of the Registrant's By-Laws provides that the Registrant shall
indemnify its officers and directors against all costs, charges, and expenses,
including amounts paid to settle an action or satisfy a judgment reasonably
incurred by him or her by reason of being or having been a director or officer,
if he or she acted honestly and in good faith with a view to the best interests
of the Company, and in the case of a civil or criminal action involving fines,
with the reasonable belief that his or her actions were legal. The Company has
purchased directors' and officers' liability insurance to provide
indemnification for its directors and officers.
<PAGE>
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit No. Description
3.1 Articles of Organization of the Company, as amended.
3.2 Restated By-Laws of the Company, as amended.
4.1 St. Laurent Paperboard Inc. Managers' Stock Option Plan.
4.2 St. Laurent Paperboard Inc. Managers' Share Purchase Plan.
4.3 St. Laurent Paperboard Inc. Long-Term Incentive Plan.
4.4 St. Laurent Paperboard Inc. Directors' Stock Option and Share
Purchase Plan.
4.5 Form of Common Shares stock certificate.
4.6 St. Laurent Paperboard Inc. Shareholder Rights Plan Agreement
dated as of February 1, 1995 and amended and restated as of May
7, 1998.
5 Opinion of the Company's Counsel regarding legality.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Robinson & Cole LLP (contained in Exhibit 5).
24 Power of Attorney (filed herewith as part of the signature page).
Item 9. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement
(or the most recent post-effective
<PAGE>
amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed
that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be
reflected in the form of a prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a
20% change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this
registration statement or any material change to such
information in this registration statement.
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in the post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Montreal, Province of Quebec, Canada, on this 1st
day of December, 1999.
ST. LAURENT PAPERBOARD, INC.
By: /s/ Marion Allaire
Marion Allaire
Vice President, Administration and Secretary
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Committee has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Montreal, Province of
Quebec, Canada, on this 1st day of December, 1999.
ST. LAURENT PAPERBOARD INC. DIRECTORS STOCK OPTION AND SHARE PURCHASE PLAN
By: Human Resources, Management Development and Compensation Committee
By: /s/ Raymond R. Pinard
Raymond R. Pinard, Director
ST. LAURENT PAPERBOARD INC. MANAGERS' STOCK OPTION PLAN
By: Human Resources, Management Development and Compensation Committee
By: /s/ Raymond R. Pinard
Raymond R. Pinard, Director
ST. LAURENT PAPERBOARD INC. LONG-TERM INCENTIVE PLAN
By: Human Resources, Management Development and Compensation Committee
By: /s/ Raymond R. Pinard
Raymond R. Pinard, Director
ST. LAURENT PAPERBOARD INC. MANAGERS' SHARE PURCHASE PLAN
By: Human Resources, Management Development and Compensation Committee
By: /s/ Raymond R. Pinard
Raymond R. Pinard, Director
<PAGE>
POWER OF ATTORNEY
Each of the officers and directors of St. Laurent Paperboard, Inc. whose
signature appears below hereby constitutes and appoints Marion Allaire and
Joseph J. Gurandiano, and each of them, his true and lawful attorneys-in-fact
and agents with full power of substitution, each with the power to act alone, to
sign and execute on behalf of the undersigned any amendment or amendments to
this Registration Statement (including post-effective amendments), and to
perform any acts necessary to be done in order to file such amendment, and each
of the undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or their or his substitutes, shall do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities indicated
on December 1, 1999.
Signature
/s/ Marion Allaire /s/ Brenton S. Halsey
Marion Allaire Brenton S. Halsey
Vice President, Administration Director
and Secretary
/s/ Joseph J. Gurandiano /s/ Robert LaCroix
Joseph J. Gurandiano Robert LaCroix
President/Chief Executive Officer/ Director
Director
/s/ Richard Garneau /s/ John Leboutillier
Richard Garneau John Leboutillier
Senior Vice President/Chief Director
Financial Officer
/s/ Luc Dufour /s/ Josiah O. Low, III
Luc Dufour Josiah O. Low, III
Controller Director
/s/ Raymond R. Pinard /s/ George F. Michaels
Raymond R. Pinard George F. Michaels
Director Director
/s/ E.J. Rice
E. J. Rice
Director
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBIT INDEX
REGISTRATION STATEMENT ON FORM S-8
ST. LAURENT PAPERBOARD, INC.
Exhibit No. Description Page
No.
3.1 Articles of Organization of the Company, 12
as amended.
3.2 By-Laws of the Company, as amended. 27
4.1 St. Laurent Paperboard Inc. Managers' 53
Stock Option Plan.
4.2 St. Laurent Paperboard Inc. Managers' 58
Share Purchase Plan.
4.3 St. Laurent Paperboard Inc. Long-Term 71
Incentive Plan.
4.4 St. Laurent Paperboard Inc. Directors' 84
Stock Option and Share Purchase Plan.
4.5 Form of Common Shares stock certificate. 91
4.6 St. Laurent Paperboard Inc. Shareholder 93
Rights Plan Agreement dated as of
February 1, 1995 and amended
and restated as of May 7, 1998.
5 Opinion of Robinson & Cole LLP regarding 136
legality.
23.1 Consent of PricewaterhouseCoopers LLP. 137
23.2 Consent of Robinson & Cole LLP. contained in
Exhibit 5
24 Power of Attorney. filed herewith as
part of the
signature page
EXHIBIT 3.1
INDUSTRY AND SCIENCE CANADA
Restated Certificate of Incorporation
Canada Business Corporations Act
St. Laurent Paperboard Inc. 290556-6
Name of corporation Corporation number
I hereby certify that the articles of incorporation of the above-named
corporation were restated under section 180 of the Canada Business Corporations
Act as set out in the attached restated articles of incorporation.
January 27, 1994
Director Effective Date of Restatement
<PAGE>
FORM 7
RESTATED ARTICLES OF INCORPORATION
(SECTION 174)
1 - Name of corporation: Corporation No.
St. Laurent Paperboard Inc. 290556-6
2 - The place in Canada where the registered office is situated:
Territory of the Montreal Urban Community, in the Province of Quebec
3 - The classes and any maximum number of shares that the
corporation is authorized to issue:
Common Shares - Unlimited number
4 - Restrictions if any on share transfers:
The shares of the Corporation shall not be transferred without the consent
of either (i) the directors evidenced by a resolution passed or signed by
them and recorded in the books of the Corporation or (ii) the holders of a
majority in number of the outstanding voting shares of the Corporation.
5 - Number (of minimum and maximum number) of directors:
Minimum 1 - Maximum 15, the number to be determined by the
directors from time to time.
6 - Restrictions if any on business the corporation may carry on:
N/A
7 - Other provisions if any:
The number of shareholders of the Corporation is limited to fifty, not
including persons who are in the employment of the Corporation and persons,
who, having been formerly in the employment of the Corporation, were, while
in that employment, and have continued after the termination of that
employment to be, shareholders of the Corporation, two or more persons
holding one or more shares jointly being counted as a single shareholder.
Any distribution of securities of the Corporation to the public or any
invitation to the public to subscribe for securities of the Corporation is
prohibited.
The foregoing restated articles of incorporation correctly set out, without
substantive change, the corresponding provisions of the articles of
incorporation as amended and supersede the original articles of incorporation.
Date of incorporation: March 19, 1993.
Signature Date: 1/26/94
Description of office
Director
<PAGE>
Certificate of Amendment
Canada Business Corporations Act
St. Laurent Paperboard Inc. 290556-6
Name of corporation Corporation number
I hereby certify that the articles of the above-named corporation were amended
|_| (a) under section 13 of the Canada Business Corporations Act in
accordance with the attached notice;
|_| (b) under section 27 of the Canada Business Corporations Act as set out in
the attached articles of amendment designating a series of shares;
|X| (c) under section 179 of the Canada Business Corporations Act
as set out in the attached articles of amendment;
|_| (d) under section 191 of the Canada Business Corporations Act
as set out in the attached articles of reorganization;
|_| (e) under section 192 of the Canada Business Corporations Act
as set out in the attached articles of arrangement;
<PAGE>
CANADA BUSINESS
CORPORATIONS ACT
FORM 4
ARTICLES OF AMENDMENT
(SECTION 27 OR 177)
1 - Name of Corporation
St. Laurent Paperboard Inc.
2 - Corporation No.
290556-6
3 - The articles of the above-named Corporation are amended as follows:
A. The authorized capital of the Corporation is hereby increased by
the creation of an unlimited number of Class "A" Preferred
Shares, issuable in series;
B. Section 3 of the Restated Articles of Incorporation be and is hereby
amended by repealing and replacing said Section 3 by the following:
3 - The classes and any maximum number of shares that the Corporation is
authorized to issue
Unlimited number of Common Shares; and
Unlimited number of Class "A" Preferred Shares, issuable in series.
I. The Common Shares shall have attached thereto the following rights,
privileges, restrictions and conditions:
(a) Each Common Share shall entitle the holder thereof to one (1) vote at
all meetings of the shareholders of the Corporation (except meetings at
which only holders of another specified class of shares are entitled to
vote pursuant to the provisions hereof or pursuant to the provisions of
<PAGE>
the Canada Business Corporations Act (hereinafter referred to as the
Act")).
(b) The holders of the Common Shares shall in each year in the discretion
of the directors, subject to the rights, privileges, restrictions and
conditions attaching to the Class "A" Preferred Shares and to any other
class of shares ranking prior to the Common Shares, be entitled to
dividends which may be paid in money or property or by issuing fully
paid shares of the Corporation as the directors may from time to time
determine.
(c) In the event of the liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, or other distribution of
assets of the Corporation among shareholders for the purpose of
winding-up its affairs, subject to the rights, privileges, restrictions
and conditions attaching to the Class "A" Preferred Shares and to any
other class of shares ranking prior to the Common Shares, the holders
of Common Shares shall be entitled to receive the remaining property of
the Corporation.
II. The Class "A" Preferred Shares shall have attached thereto, as a class,
the following rights, privileges, restrictions and conditions:
(a) The directors of the Corporation may at any time and from time to time,
issue the Class "A" Preferred Shares in one (1) or more series, each
series to consist of such number of shares as may, before 'issuance
thereof, be determined by the directors.
(b) The directors of the Corporation may (subject as hereinafter provided)
from time to time fix, before issuance, the designation, rights,
privileges, restrictions, conditions and limitations to attach to the
Class "A" Preferred Shares of each series including, without limiting
the generality of the foregoing, the rate, amount or method of
calculation of preferential dividends, whether cumulative or
non-cumulative or partially cumulative, and whether such rate, amount
or method of calculation shall be subject to change or adjustment in
the future, the currency or currencies of payment, the date or dates
and place or places of payment thereof and the date or dates from which
such preferential dividends shall accrue, the redemption price and
<PAGE>
terms and conditions of redemption, the rights of retraction, if any,
vested in the holders of Class "A" Preferred Shares of such series, and
the prices and the other terms and conditions of any rights of
retraction, and whether any additional rights of retraction may be
vested in such holders in the future, voting rights and conversion
rights (if any) and any sinking fund, purchase fund or other provisions
attaching to the Class "A" Preferred Shares of such series, the whole
subject to the issue by the Director responsible for the application of
the Act, of a certificate of amendment in respect of articles of
amendment in the prescribed form to designate a series of shares.
(c) When any cumulative dividends or amounts payable on a return of capital
in respect of a series of Class "A" Preferred Shares are not paid in
full, the Class "A" Preferred Shares of all series shall participate
rateably in respect of such dividends including accumulations, if any,
in accordance with the sums which would be payable on the Class "A"
Preferred Shares if all such dividends were declared and paid in full,
and on any return of capital in accordance with the sums which would be
payable on such return of capital if all sums so payable were paid in
full.
(d) The Class "A" Preferred Shares shall be entitled to preference over the
Common Shares of the Corporation and any other shares of the
Corporation ranking junior to the Class "A" Preferred Shares with
respect to the payment of dividends, and may also be given such other
preferences over the Common Shares of the Corporation and any other
shares of the Corporation ranking junior to the Class "A" Preferred
Shares, as may be fixed by the directors of the Corporation, as to the
respective series authorized to be issued.
(e) The Class "A" Preferred Shares of each series shall rank on a parity
with the Class "A" Preferred Shares of every other series with respect
to priority in payment of dividends and in the distribution of assets
in the event of liquidation, dissolution or winding-up of the
Corporation whether voluntary of involuntary.
(f) In the event of the liquidation, dissolution or winding-up of the
Corporation or other distribution of assets of the Corporation among
shareholders for the purpose of winding-up its affairs, the holders of
the Class "A" Preferred Shares shall, before any amount shall be paid
to or any property or assets of the Corporation distributed among the
holders of the Common Shares or any other shares of the Corporation
ranking junior to the Class "A" Preferred Shares, be entitled to
receive (i) an amount equal to the consideration received by the
<PAGE>
Corporation upon the issuance of such shares together with, in the case
of cumulative Class "A" Preferred Shares, all unpaid cumulative
dividends (which for such purpose shall be calculated as if such
cumulative dividends were accruing from day to day for the period from
the expiration of the last period for which cumulative dividends have
been paid-up to and including the date of distribution) and, in the
case of non-cumulative Class "A" Preferred Shares, all declared and
unpaid non-cumulative dividends, and (ii) if such liquidation,
dissolution, winding-up or distribution shall be voluntary, an
additional amount equal to the premium, if any, which would have been
payable on the redemption of the said Class "A" Preferred Shares
respectively if they had been called for redemption by the Corporation
on the date of distribution and, if said Class "A" Preferred Shares
could not be redeemed on such date, then an additional amount equal to
the greatest premium, if any, which would have been payable on the
redemption of said Class "A" Preferred Shares respectively.
(g) No dividends shall at any time be declared or paid on or set apart for
payment on any shares of the Corporation ranking junior to the Class
"A" Preferred Shares, unless all dividends up to and including the
dividend payable for the last completed period for which such dividends
shall be payable on each series of Class "A" Preferred Shares then
issued and outstanding shall have been declared and paid or set apart
for payment at the date of such declaration or payment or setting apart
for payment on such shares of the Corporation ranking junior to the
Class "A" Preferred Shares, nor shall the Corporation call for
redemption or redeem or purchase for cancellation or reduce or
otherwise pay off any of the Class "A" Preferred Shares (less than the
total amount then outstanding) or any shares of the Corporation ranking
junior to the Class "A" Preferred Shares, unless all dividends up to
and including the dividend payable for the last completed period for
which such dividends shall be payable on each series of the Class "A"
Preferred Shares then issued and outstanding shall have been declared
and paid or set apart for payment at the date of such call for
redemption, purchase, reduction or other payment.
(h) The Class "A" Preferred Shares of any series may be purchased for
cancellation or made subject to redemption by the Corporation at such
times and at such prices and upon such other terms and conditions as
may be specified in the rights, privileges, restrictions and conditions
attaching to the Class "A" Preferred Shares of such series as set forth
in the resolution of the board of directors of the Corporation and
certificate of amendment relating to such series.
<PAGE>
(i) The provisions of paragraphs 11. (a) to (h), inclusive, and of this
paragraph (i) may be deleted or varied in whole or in part by a
certificate of amendment, but only with the prior approval of the
holders of the Class "A" Preferred Shares, given as hereinafter
specified, in addition to any other approval required by the Act (or
any other statutory provision of the like or similar effect, from time
to time in force). The approval of the holders of the Class "A"
Preferred Shares with respect to any and all matters hereinbefore
referred to, may be given by at least two-thirds (2/3) of the votes
cast at a meeting of the holders of the Class "A" Preferred Shares duly
called for that purpose and held upon at least twenty-one (21) days
notice at which the holders of a majority of the outstanding Class "A"
Preferred Shares are present or represented by proxy. If at any such
meeting the holders of a majority of the outstanding Class "A"
Preferred Shares are not present or represented by proxy within thirty
(30) minutes after the time appointed for such meeting, then the
meeting shall be adjourned to such date being not less than thirty (30)
days later and to such time and place as may be determined by the
chairman and not less than twenty-one (21) days notice shall be given
of such adjourned meeting but it shall not be necessary in such notice
to specify the purpose for which the meeting was originally called. At
such adjourned meeting the holders of Class "A" Preferred Shares,
present or represented by proxy, may transact the business for which
the meeting was originally called and a resolution passed thereat by
not less than two-thirds (2/3) of the votes cast at such adjourned
meeting, shall constitute the authorization of the holders of the Class
"A" Preferred Shares referred to above. The formalities to be observed
in respect of the giving of notice of any such meeting or adjourned
meeting and the conduct thereof shall be those from time to time
prescribed by the by-laws of the Corporation with respect to meetings
of shareholders. On every poll taken at every such meeting or adjourned
meeting, every holder of Class "A" Preferred Shares shall be entitled
to one (1) vote in respect of each Class "A" Preferred Share held.
<PAGE>
C. Section 4 of the Restated Articles of Incorporation be and the same is
hereby deleted and replaced by the following:
4 - Restrictions if any on share transfers
None.
D. Section 5 of the Restated Articles of Incorporation be and the same is
hereby deleted and replaced by the following:
5 - Number (or minimum and maximum number) of directors
A minimum of three (3) directors and a maximum of fifteen (15)
directors.
E. Section 7 of the Restated Articles of Incorporation be and the same is
hereby deleted and replaced by the following:
7- Other provisions if any
None.
Date Signature
/s/ Marion Allaire
Marion Allaire
Title
Vice President, Administration and Secretary
FOR DEPARTMENTAL USE ONLY
filed Apr 18, 1994
<PAGE>
Restated Certificate of Incorporation
Canada Business Corporations Act
St. Laurent Paperboard Inc. 290556-6
Name of corporation Corporation number
I hereby certify that the articles of incorporation of the above-named
corporation were restated under section 180 of the Canada Business Corporations
Act as set out in the attached restated articles of incorporation.
April 15, 1994
Director Effective Date of Reinstatement
<PAGE>
CANADA BUSINESS
CORPORATIONS ACT
FORM 7
RESTATED ARTICLES OF INCORPORATION
(SECTION 180)
1 - Name of Corporation Corporation No.
St. Laurent Paperboard Inc. 290556-6
2 - The place in Canada where the registered office is situated
Territory of the Montreal Urban Community, in the Province of
Quebec
3 - The classes and any maximum number of shares that the Corporation is
authorized to issue
Unlimited number of Common Shares; and
Unlimited number of Class "A" Preferred Shares, issuable in series.
I. The Common Shares shall have attached thereto the following rights,
privileges, restrictions and conditions:
(a) Each Common Share shall entitle the holder thereof to one (1) vote at
all meetings of the shareholders of the Corporation (except meetings at
which only holders of another specified class of shares are entitled to
vote pursuant to the provisions hereof or pursuant to the provisions of
the Canada Business Corporations Act (hereinafter referred to as the
"Act")).
(b) The holders of the Common Shares shall in each year in the discretion
of the directors, subject to the rights, privileges, restrictions and
conditions attaching to the Class "A" Preferred Shares and to any other
class of shares ranking prior to the Common Shares, be entitled to
dividends which may be paid in money or property or by issuing fully
paid shares of the Corporation as the directors may from time to time
determine.
<PAGE>
(c) In the event of the liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, or other distribution of
assets of the Corporation among shareholders for the purpose of
winding-up its affairs, subject to the rights, privileges, restrictions
and conditions attaching to the Class "A" Preferred Shares and to any
other class of shares ranking prior to the Common Shares, the holders
of Common Shares shall be entitled to receive the remaining property of
the Corporation.
II. The Class "A" Preferred Shares shall have attached thereto, as a class,
the following rights, privileges, restrictions and conditions:
(a) The directors of the Corporation may at any time and from time to time,
issue the Class "A" Preferred Shares in one (1) or more series, each
series to consist of such number of shares as may, before issuance
thereof, be determined by the directors.
(b) The directors of the Corporation may (subject as hereinafter provided)
from time to time fix, before issuance, the designation, rights,
privileges, restrictions, conditions and limitations to attach to the
Class "A" Preferred Shares of each series including, without limiting
the generality of the foregoing, the rate, amount or method of
calculation of preferential dividends, whether cumulative or
non-cumulative or partially cumulative, and whether such rate, amount
or method of calculation shall be subject to change or adjustment in
the future, the currency or currencies of payment, the date or dates
and place or places of payment thereof and the date or dates from which
such preferential dividends shall accrue, the redemption price and
terms and conditions of redemption, the rights of retraction, if any,
vested in the holders of Class "A" Preferred Shares of such series, and
the prices and the other terms and conditions of any rights of
retraction, and whether any additional rights of retraction may be
vested in such holders in the future, voting rights and conversion
rights (if any) and any sinking fund, purchase fund or other provisions
attaching to the Class "A" Preferred Shares of such series, the whole
subject to the issue by the Director responsible for the application of
the Act, of a certificate of amendment in respect of articles of
amendment in the prescribed form to designate a series of shares.
<PAGE>
(c)When any cumulative dividends or amounts payable on a return of capital
in respect of a series of Class "A" Preferred Shares are not paid in
full, the Class "A" Preferred Shares of all series shall participate
rateably in respect of such dividends including accumulations, if any,
in accordance with the sums which would be payable on the Class "A"
Preferred Shares if all such dividends were declared and paid in full,
and on any return of capital in accordance with the sums which would be
payable on such return of capital if all sums so payable were paid in
full.
(d)The Class "A" Preferred Shares shall be entitled to preference over the
Common Shares of the Corporation and any other shares of the
Corporation ranking junior to the Class "A" Preferred Shares with
respect to the payment of dividends, and may also be given such other
preferences over the Common Shares of the Corporation and any other
shares of the Corporation ranking junior to the Class "A" Preferred
Shares, as may be fixed by the directors of the Corporation, as to the
respective series authorized to be issued.
(e)The Class "A" Preferred Shares of each series shall rank on a parity
with the Class "A" Preferred Shares of every other series with respect
to priority in payment of dividends and in the distribution of assets
in the event of liquidation, dissolution or winding-up of the
Corporation whether voluntary of involuntary.
(f) In the event of the liquidation, dissolution or winding-up of the
Corporation or other distribution of assets of the Corporation among
shareholders for the purpose of winding-up its affairs, the holders of
the Class "A" Preferred Shares shall, before any amount shall be paid
to or any property or assets of the Corporation distributed among the
holders of the Common Shares or any other shares of the Corporation
ranking junior to the Class "A" Preferred Shares, be entitled to
receive (i) an amount equal to the consideration received by the
Corporation upon the issuance of such shares together with, in the
case of cumulative Class "A" Preferred Shares, all unpaid cumulative
dividends (which for such purpose shall be calculated as if such
cumulative dividends were accruing from day to day for the period from
the expiration of the last period for which cumulative dividends have
been paid-up to and including the date of distribution) and, in the
case of non-cumulative Class "A" Preferred Shares, all declared and
unpaid non-cumulative dividends, and (ii) if such liquidation,
<PAGE>
dissolution, winding-up or distribution shall be voluntary, an
additional amount equal to the premium, if any, which would have been
payable on the redemption of the said Class "A" Preferred Shares
respectively if they had been called for redemption by the Corporation
on the date of distribution and, if said Class "A" Preferred Shares
could not be redeemed on such date, then an additional amount equal to
the greatest premium, if any, which would have been payable on the
redemption of said Class "A" Preferred Shares respectively.
(g)No dividends shall at any time be declared or paid on or set apart for
payment on any shares of the Corporation ranking junior to the Class
"A" Preferred Shares, unless all dividends up to and including the
dividend payable for the last completed period for which such dividends
shall be payable on each series of Class "A" Preferred Shares then
issued and outstanding shall have been declared and paid or set apart
for payment at the date of such declaration or payment or setting apart
for payment on such shares of the Corporation ranking junior to the
Class "A" Preferred Shares, nor shall the Corporation call for
redemption or redeem or purchase for cancellation or reduce or
otherwise pay off any of the Class "A" Preferred Shares (less than the
total amount then outstanding) or any shares of the Corporation ranking
junior to the Class "A" Preferred Shares, unless all dividends up to
and including the dividend payable for the last completed period for
which such dividends shall be payable on each series of the Class "A"
Preferred Shares then issued and outstanding shall have been declared
and paid or set apart for payment at the date of such call for
redemption, purchase, reduction or other payment.
(h) The Class "A" Preferred Shares of any series may be purchased for
cancellation or made subject to redemption by the Corporation at such
times and at such prices and upon such other terms and conditions as
may be specified in the rights, privileges, restrictions and
conditions attaching to the Class "A" Preferred Shares of such series
as set forth in the resolution of the board of directors of the
Corporation and certificate of amendment relating to such series.
(i) The provisions of paragraphs 11. (a) to (h), inclusive, and of this
paragraph (i) may be deleted or varied in whole or in part by a
certificate of amendment, but only with the prior approval of the
holders of the Class "A" Preferred Shares, given as hereinafter
specified, in addition to any other approval required by the Act (or
any other statutory provision of the like or similar effect, from time
to time in force). The approval of the holders of the Class "A"
Preferred Shares with respect to any and all matters hereinbefore
referred to, may be given by at least two-thirds (2/3) of the votes
cast at a meeting of the holders of the Class "A" Preferred Shares
duly called for that purpose and held upon at least twenty-one (21)
days notice at which the holders of a majority of the outstanding
<PAGE>
Class "A" Preferred Shares are present or represented by proxy. If at
any such meeting the holders of a majority of the outstanding Class
"A" Preferred Shares are not present or represented by proxy within
thirty (30) minutes after the time appointed for such meeting, then
the meeting shall be adjourned to such date being not less than thirty
(30) days later and to such time and place as may be determined by the
chairman and not less than twenty-one (21) days notice shall be given
of such adjourned meeting but it shall not be necessary in such notice
to specify the purpose for which the meeting was originally called. At
such adjourned meeting the holders of Class "A" Preferred Shares,
present or represented by proxy, may transact the business for which
the meeting was originally called and a resolution passed thereat by
not less than two-thirds (2/3) of the votes cast at such adjourned
meeting, shall constitute the authorization of the holders of the
Class "A" Preferred Shares referred to above. The formalities to be
observed in respect of the giving of notice of any such meeting or
adjourned meeting and the conduct thereof shall be those from time to
time prescribed by the by-laws of the Corporation with respect to
meetings of shareholders. On every poll taken at every such meeting or
adjourned meeting, every holder of Class "A" Preferred Shares shall be
entitled to one (1) vote in respect of each Class "A" Preferred Share
held.
4 - Restrictions if any on share transfers
None.
5 - Number (or minimum and maximum number) of directors
A minimum of three (3) directors and a maximum of fifteen (15) directors.
EXHIBIT 3.2
ST. LAURENT PAPERBOARD INC.
BY-LAWS AND ADMINISTRATIVE RESOLUTIONS
Consolidated Version
Passed March 19,1993, amended May 10,1994 (section 5.06)
July 26,1994, (section 5.07), October 19,1994 (section 4.01(c))
July 27,1995, (section 5.09), November 8,1995 (section 5.06)
October 21, 1996, (section 5.05), subsection (a))
October 21, 1996 (section 5.07)
September 9, 1997, (section 4.01)
December 3, 1997 (section 5.06)
<PAGE>
ST. LAURENT PAPERBOARD INC.
INDEX
BY-LAWS
Part I - Interpretation
1.01 Definitions
Part ll - Meetings of Directors
2.01 Action by the Board
2.02 Canadian Majority
2.03 Meeting by Communications Facilities
2.04 Place of Meetings
2.05 Calling of Meetings
2.06 First Meeting of New Board
2.07 Adjourned Meeting
2.08 Regular Meetings
2.09 Chairman
2.10 Votes to Govern
2.11 Quorum
2.12 Remuneration and Expenses
Part lll - Meetings of Shareholders
3.01 Annual Meetings
3.02 Special Meetings
3.03 Place of Meetings
3.04 Notice of Meetings
3.05 List of Shareholders Entitled to Vote
3.06 Record Date for Notice
3.07 Meetings without Notice
<PAGE>
3.08 Chairman, Secretary and Scrutineers
3.09 Persons Entitled to be Present
3.10 Quorum
3.11 Right to Vote
3.12 Proxyholders and Representatives
3.13 Time for Deposit of Proxies
3.14 Personal Representative
3.15 Joint Shareholders
3.16 Votes to Govern
3.17 Voting
3.18 Ballots
3.19 Adjournment
Part IV - Dividends and Rights
4.01 Dividends
4.02 Dividend Cheques
4.03 Non-Receipt of Cheques
4.04 Record Date for Dividends and Rights
4.05 Unclaimed Dividends
Part V - Protection of Directors, Officers and Others
5.01 Limitation of Liability
5.02 Indemnity
5.03 Insurance
Part Vl - Notices
6.01 Method of Giving Notices
6.02 Notice to Joint Shareholders
6.03 Computation of Time
6.04 Undelivered Notices
6.05 Omissions and Errors
6.06 Persons Entitled by Death or Operation of Law
<PAGE>
6.07 Waiver of Notice
ADMINISTRATIVE RESOLUTIONS
Article I - Business of the Corporation
1.01 Financial Year
1.02 Execution of Instruments
1.03 Banking Arrangements
1.04 Voting Rights in Other Bodies Corporate
1.05 Company Representation for Certain Purposes
1.06 Corporate Seal
Article ll - Officers
2.01 Appointment
2.02 Chairman of the Board, Vice-Chairman of the Board and President
2.03 Chief Executive Officer
2.04 Chief Operating Officer
2.05 Vice-President
2.06 Secretary
2.07 Treasurer
2.08 Controller
2.09 Powers and Duties of Other Officers
2.10 Variation of Powers and Duties
2.11 Term of Office
2.12 Terms of Employment and Remuneration
2.13 Declaration of Interest
2.14 Agents and Attorneys
2.15 Fidelity Bonds
Article lll - Shares and Securities
3.01 Allotment
3.02 Share Certificates
3.03 Securities Registers
<PAGE>
3.04 Registration of Transfers
3.05 Registrars and Transfer Agents
3.06 Replacement of Share Certificates
3.07 Joint Shareholders
3.08 Deceased Shareholders
Article IV - Remuneration of Directors
4.01 Remuneration
Article V - Committees of the Board
5.01 Committees of the Board
5.02 Term of Office
5.03 Procedure, Chairman, Secretary
5.04 Executive Committee
5.05 Audit Committee
5.06 Human Resources Management Development and Compensation Committee
5.07 Pension Fund Review Committee
5.08 Environment, Health and Safety Committee
5.09 Corporate Governance and Nominating Committee
Article Vl - Interpretation
6.01 Interpretation, Definitions
<PAGE>
ST. LAURENT PAPERBOARD INC.
BY-LAW NO. 1
By-laws relating generally to the transaction of the business and affairs of
ST. LAURENT PAPERBOARD INC.
BE IT ENACTED as By-laws of ST. LAURENT PAPERBOARD INC. (hereinafter referred
to as the "Corporation") as follows:
PART I
INTERPRETATION
1.01 Definitions. In this by-law and all other by-laws and special resolutions
of the Corporation, unless the context otherwise requires:
"Act" means the Canada Business Corporations Act and any statute
that may be substituted therefor, as from time to time amended;
"appoint" includes "elect" and vice versa;
"board" means the board of directors of the Corporation;
"by-laws" means this by-law and all other by-laws of the Corporation
from time to time in force and effect;
"meeting of shareholders" includes an annual meeting of shareholders
and a special meeting of shareholders, "special meeting of
shareholders" includes a meeting of any class or classes of
shareholders and a special meeting of all shareholders entitled to
vote at an annual meeting of shareholders; "special business" means
that business transacted at a special meeting of shareholders and an
annual meeting of shareholders which is by the Act deemed or defined
to be special business;
"non-business day" means Saturday, Sunday and any other day that
is a holiday as defined in the Interpretation Act (Canada);
"recorded address" means, in the case of a shareholder, his latest
address as recorded in the securities register; and in the case of
joint shareholders the address appearing in the securities register
in respect of such joint holding or the first address so appearing
if there is more than one; and in the case of a director, officer,
auditor or member of a committee of the board, his latest address
recorded in the records of the Corporation;
<PAGE>
save as aforesaid and unless the context otherwise requires, words
and expressions defined in the Act have the same meanings when used herein;
words importing the singular number include the plural and vice versa; words
importing the masculine gender include the feminine and neuter genders; and
words importing persons include individuals, bodies corporate, partnerships,
trusts and unincorporated organizations; and
any notice, resolution, statement or other document required or
permitted to be executed by more than one person may be executed in several
documents of like form each of which is executed by one or more of such persons,
and such documents, when duly executed by all persons required or permitted, as
the case may be, to do so, shall be deemed to constitute one document.
PART II
MEETINGS OF DIRECTORS
2.01 Action by the Board. The board shall manage the business and affairs of the
Corporation. Subject to sections 2.02 and 2.03, the powers of the board may be
exercised by a meeting at which a quorum is present or by resolution in writing
signed by all the directors entitled to vote on that resolution at a meeting of
the board. Where there is a vacancy in the board, the remaining directors may
exercise all the powers of the board so long as a quorum remains in office.
2.02 Canadian Majority. Unless otherwise provided by the Act, the board shall
not transact business at a meeting, other than filling a vacancy in the board,
unless a majority of the directors present are resident Canadians, except where
(a) a resident Canadian director who is unable to be present approves in
writing or by telephone or other communications facilities the
business transacted at the meeting; and
(b) a majority of resident Canadians would have been present had that
director been present at the meeting.
2.03 Meeting by Communications Facilities. If all the directors present at or
participating in the meeting consent, a meeting of the board or of a committee
of the board may be held by means of such telephone, electronic or other
communications facilities as permit all persons participating in the meeting to
communicate with each other simultaneously and instantaneously, and a director
participating in such a meeting by such means shall be deemed to be present at
the meeting.
<PAGE>
2.04 Place of Meetings. Meetings of the board may be held at any place within or
outside Canada. In any financial year of the Corporation a majority of the
meetings of the board need not be held in Canada.
2.05 Calling of Meetings. Meetings of the board shall be held from time to time
at such place, at such time and on such day as the board, the Chairman of the
Board (if any), the Vice-Chairman of the Board (if any), the President, if a
director, a Vice-President who is also a director, or any two directors may
determine. Notice of the time and place of every meeting so called shall be
given in the manner provided in Part Vl to each director (a) not less than 48
hours (excluding any part of a non-business day) before the time when the
meeting is to be held if the notice is mailed, or (b) not less than 24 hours
(excluding any part of a non-business day) before the time when the meeting is
to be held if the notice is served personally or is given by telex, telegram or
other means of prepaid transmitted or recorded communication.
2.06 First Meeting of New Board. Each newly elected board may without notice
hold its first meeting immediately following the meeting of shareholders at
which such board is elected, provided a quorum of directors is present.
2.07 Adjourned Meeting. Notice of an adjourned meeting of the board is
not required if the time and place of the adjourned meeting is announced at the
original meeting.
2.08 Regular Meetings. The board may appoint a day or days in any month or
months for regular meetings of the board at a place and hour to be named. A copy
of any resolution of the board fixing the place and time of such regular
meetings shall be sent to each director at his recorded address forthwith after
being passed, but no other notice shall be required for any such regular meeting
except where the Act requires the purpose thereof or the business to be
transacted thereat to be specified.
2.09 Chairman. The Chairman of any meeting of the board shall be the first
mentioned of such of the following officers as have been appointed and who is a
director and is present at the meeting: Chairman of the Board, Vice-Chairman of
the Board, President, or a Vice-President. If no such officer is present, the
directors present shall choose one of their number to be chairman.
2.10 Votes to Govern. At all meetings of the board every question shall be
decided by a majority of the votes cast on the question. In case of any equality
of votes, the Chairman of the meeting shall be entitled to a second or casting
vote.
<PAGE>
2.11 Quorum. Subject to section 2.02, a majority of the number of directors set
out in the articles or, where a minimum and maximum number of directors of the
Corporation is provided for in the articles, a majority of the number of
directors determined by the shareholders or directors, as the case may be, shall
constitute a quorum at any meeting of the board.
2.12 Remuneration and Expenses. The directors shall be paid such remuneration
for their services as the board may from time to time determine. The directors
shall also be entitled to be reimbursed for travelling and other expenses
properly incurred by them in attending meetings of the board or any committee
thereof. Nothing herein contained shall preclude any director from serving the
Corporation in any other capacity and receiving remuneration therefor.
PART III
MEETINGS OF SHAREHOLDERS
3.01 Annual Meetings. The annual meeting of shareholders shall be held at such
time and on such day in each year and, subject to section 3.03, at such place as
the board may from time to time determine, for the purpose of considering the
reports and statements required by the Act to be placed before the annual
meeting, electing directors, appointing an auditor and transacting such other
business as may properly be brought before the meeting.
3.02 Special Meetings. The board, the Chairman of the Board, the Vice-Chairman
of the Board or the President shall have power to call a special meeting of
shareholders at any time.
3.03 Place of Meetings. Meetings of shareholders shall be held at the registered
office of the Corporation or elsewhere in the municipality in which the
registered office is situated or, if the board shall so determine, at some other
place in Canada.
3.04 Notice of Meetings. Notice of the time and place of each meeting of
shareholders shall be given in the manner provided in Part Vl not less than 21
nor more than 50 days before the date of the meeting to each director, to the
auditor and to each shareholder entitled thereto. Notice of a meeting of
shareholders at which special business is to be transacted shall state the
nature of such business in sufficient detail to permit the shareholder to form a
reasoned judgment thereon and shall state the text of any special resolution or
by-law to be submitted to the meeting.
<PAGE>
3.05 List of Shareholders Entitled to Notice. For every meeting of shareholders,
the Corporation shall prepare within the time and in the manner specified by the
Act a list of shareholders entitled to receive notice of the meeting.
3.06 Record Date for Notice. Subject to the provisions of the Act, the Board,
the Chairman of the Board, the Vice-Chairman of the Board or the President may
fix in advance a date, preceding the date of any meeting of shareholders by not
more than 50 days and not less than 21 days, as a record date for the
determination of the shareholders entitled to notice of the meeting, and notice
of any such record date shall be given in the manner, provided in the Act. If no
record date is fixed, the record date for the determination of the shareholders
entitled to notice of the meeting shall be as provided in the Act.
3.07 Meeting without Notice. A meeting of shareholders may be held at any time
and place permitted by the Act or the articles or the by-laws without notice or
on shorter notice than that provided for herein, and proceedings thereat shall
not be invalidated (a) if all the shareholders entitled to vote thereat are
present in person or represented or if those not so present or represented have
received notice or, before or after the meeting or the time prescribed for the
notice thereof, in writing waive notice of or accept short notice of such
meeting, and (b) if the auditors and the directors are present or if those not
present have received notice or, before or after the meeting or the time
prescribed for notice thereof, in writing waive notice of or accept short notice
of such meeting.
3.08 Chairman, Secretary and Scrutineers. The Chairman of any meeting of
shareholders shall be the first mentioned of such of the following officers as
have been appointed who is present at the meeting: Chairman of the Board,
Vice-Chairman of the Board, President or Vice-President who is a director. If no
such officer is present within 15 minutes from the time fixed for holding the
meeting, the persons present and entitled to vote shall choose one of their
number to be chairman. If the Secretary of the Corporation is absent, the
chairman shall appoint some person, who need not be a shareholder, to act as
secretary of the meeting. If desired, one or more scrutineers, who need not be
shareholders, may be appointed by a resolution or by the chairman with the
consent of the meeting.
3.09 Persons Entitled to be Present. The only persons entitled to attend a
meeting of shareholders shall be those entitled to vote thereat, the Chairman of
the Board (if any) the Vice-Chairman of the Board (if any), the President, the
directors and auditor of the Corporation and others who, although not entitled
to vote, are entitled or required under any provision of the Act or the articles
or by-laws to attend the meeting. Any other person may be admitted only on the
invitation of the Chairman of the meeting or with the consent of the meeting.
3.10 Quorum. Subject to the provisions of the Act, a quorum for the transaction
of business at any meeting of shareholders shall be two persons present in
person, each being a shareholder entitled to vote thereat or a duly appointed
representative or proxyholder for an absent shareholder so entitled and holding
or representing in the aggregate shares to which are attached not less than 20%
of the voting rights attaching to all outstanding voting shares of the
<PAGE>
Corporation entitled to vote at the meeting. If a quorum is present at the
opening of any meeting of shareholders, the shareholders present or represented
may proceed with the business of the meeting notwithstanding that a quorum is
not present throughout the meeting. If a quorum is not present at the opening of
any meeting of shareholders, the shareholders present or represented may adjourn
the meeting to a fixed time and place but may not transact any other business.
3.11 Right to Vote. Subject to the provisions of the Act as to authorized
representatives of any other body corporate or association, at any meeting of
shareholders for which the Corporation must prepare the list referred to in
section 3.05, every person who is named in such list shall be entitled to vote
the shares shown opposite his name except to the extent that, (a) where the
Corporation has fixed a record date in respect of such meeting, such person has
transferred any of his shares after such record date, or where the Corporation
has not fixed a record date in respect of such meeting, such person has
transferred any of his shares after the date on which such list is prepared, and
(b) the transferee, having produced properly endorsed certificates evidencing
such shares or having otherwise established that he owns such shares, has
demanded not later than 10 days before the meeting that his name be included in
such list. In any such excepted case the transferee shall be entitled to vote
the transferred shares at the meeting. At any meeting of shareholders for which
the Corporation has not prepared the list referred to in section 3.05, every
person shall be entitled to vote at the meeting who at the time is entered in
the securities register as the holder of one or more shares carrying the right
to vote at such meeting.
3.12 Proxyholders and Representatives. Every shareholder entitled to vote at a
meeting of shareholders may appoint a proxyholder, or one or more alternate
proxyholders, who need not be shareholders, to attend and act at the meeting in
the manner and to the extent authorized and with the authority conferred by the
proxy. A proxy shall be in writing executed by the shareholder or his attorney
and shall conform with the requirements of the Act. Every such shareholder which
is a body corporate or association may by resolution of its directors or
governing body authorize an individual who need not be a shareholder to
represent it at a meeting of shareholders and such individual may exercise on
the shareholder's behalf all the powers it could exercise if it were an
individual shareholder. The authority of such an individual shall be established
by depositing with the Corporation a certified copy of such resolution, or in
such other manner as may be satisfactory to the Secretary of the Corporation or
the chairman of the meeting.
3.13 Time for Deposit of Proxies. The board may specify in a notice calling a
meeting of shareholders a time preceding the time of such meeting by not more
than 48 hours exclusive of non-business days, before which time proxies to be
used at such meeting must be deposited. A proxy shall be acted upon only if,
prior to the time so specified, it shall have been deposited with the
Corporation or an agent thereof specified in such notice or, if no such time is
specified in such notice, if it has been received by the Secretary of the
Corporation or by the chairman of the meeting or any adjournment thereof prior
to the time of voting.
<PAGE>
3.14 Personal Representative. If the shareholder of record is deceased, his
personal representative, upon filing with the secretary of the meeting
sufficient proof of his appointment, shall be entitled to exercise the same
voting rights at any meeting of shareholders as the shareholder of record would
have been entitled to exercise if he were living and for the purposes of the
meeting shall be considered a shareholder. If there is more than one personal
representative, the provisions of section 3.15 shall apply.
3.15 Joint Shareholders. If two or more persons hold shares jointly, any one of
them present in person or represented at a meeting of shareholders may, in the
absence of the other or others, vote the shares; but if two or more of those
persons are present in person or represented and vote, they shall vote as one
the shares jointly held by them.
3.16 Votes to Govern. At any meeting of shareholders every question shall,
unless otherwise required by the articles or by-laws or by law, be determined by
a majority of the votes cast on the question. In case of an equality of votes
either upon a show of hands or upon a ballot, the chairman of the meeting shall
be entitled to a casting vote.
3.17 Voting. Subject to the provisions of the Act, any question at a meeting of
shareholders shall be decided by a show of hands unless a ballot thereon is
required or demanded as hereinafter provided. Upon a show of hands every person
who is present and entitled to vote shall have one vote. Whenever a vote by show
of hands shall have been taken upon a question, unless a ballot thereon is so
required or demanded, an entry in the minutes of the meeting to the effect that
the chairman of the meeting declared that the vote upon the question has been
carried or carried by a particular majority or not carried shall be prima facie
evidence of the fact without proof of the number or proportion of the votes
recorded in favour of or against any resolution or other proceeding in respect
of the said question, and the result of the vote so taken shall be the decision
of the shareholders upon the said question.
3.18 Ballots. On any question proposed for consideration at a meeting of
shareholders, and whether or not a show of hands has been taken thereon, the
chairman may require a ballot or any person present and entitled to vote on such
question at the meeting may demand a ballot. A ballot so required or demanded
shall be taken in such manner as the chairman shall direct. A requirement or
demand for a ballot may be withdrawn at any time prior to the taking of the
ballot. If a ballot is taken each person present shall be entitled, in respect
of the shares which he is entitled to vote at the meeting upon the question, to
that number of votes provided by the Act or the articles, and the result of the
ballot so taken shall be the decision of the shareholders upon the said
question.
<PAGE>
3.19 Ajournment. If a meeting of shareholders is adjourned for less than 30
days, it shall not be necessary to give notice of adjourned meeting, other than
by announcement at the earliest meeting that is adjourned. If a meeting of
shareholders is adjourned by one or more adjournments for an aggregate of 30
days or more, notice of the adjourned meeting shall be given as for an original
meeting.
PART IV
DIVIDENDS AND RIGHTS
4.01 Dividends. Subject to the provisions of the Act and the articles, the board
may from time to time declare dividends payable to the shareholders according to
their respective rights and interest in the Corporation.
4.02 Dividend Cheques. A dividend payable in money shall be paid by cheque to
the order of each registered holder of shares of the class or series in respect
of which it has been declared and mailed by prepaid ordinary mail to such
registered holder at his recorded address, unless such holder otherwise directs.
In the case of joint holders the cheque shall, unless such joint holders
otherwise direct, be made payable to the order of all of such joint holders and
mailed to them at the recorded address in respect of such joint holding, or to
the first such recorded address if there is more than one. The mailing of such
cheque as aforesaid, unless the same is not paid on due presentation, shall
satisfy and discharge the liability for the dividend to the extent of the sum
represented thereby plus the amount of any tax which the Corporation is required
to and does withhold.
4.03 Non-receipt of cheques. In the event of non-receipt of any dividend cheque
by the person to whom it is sent as aforesaid, the Corporation shall issue or
cause to be issued to such person a replacement cheque for a like amount on such
terms as to indemnity, reimbursement of expenses and evidence of non-receipt and
of title as the board may from time to time prescribe, whether generally or in
any particular case.
4.04 Recorded Date for Dividends and Rights. The board may fix in advance a
date, preceding by not more than 50 days the date for the payment of any
dividend or the date for the issue of any warrant or other evidence of the right
to subscribe for securities of the Corporation, as a record date for the
determination of the persons entitled to receive payment of such dividend or to
exercise the right to subscribe for such securities, and notice of any such
record date shall be given in the time and in the manner provided by the Act. If
no record date is so fixed, the record date for the determination of the persons
entitled to receive payment of any dividend or to exercise the right to
subscribe for securities of the Corporation shall be such date as may be
established by the Act.
<PAGE>
4.05 Unclaimed Dividends. Any dividend unclaimed after a period of 6 years from
the date on which the same has been declared to be payable shall be forfeited
and shall revert to the Corporation.
PART V
PROTECTION OF DIRECTORS, OFFICERS AND OTHERS
5.01 Limitation of Liability. No director or officer shall be liable for the
acts, receipts, neglects or defaults of any other director or officer or
employee, or for joining in any receipt or other act for conformity, or for any
loss, damage or expense happening to the Corporation through the insufficiency
or deficiency of title to any property acquired for or on behalf of the
Corporation, or for the insufficiency or deficiency of any security in or upon
which any of the moneys of the Corporation shall be invested, or for any loss or
damage arising from the bankruptcy, insolvency or tortious acts of any person
with whom any of the moneys, securities or effects of the Corporation shall be
deposited, or for any loss occasioned by any error of judgment or oversight on
his part, or for any other loss, damage or misfortune whatever which shall
happen in the execution of the duties of his office or in relation thereto;
provided that nothing herein shall relieve any director or officer from the duty
to act in accordance with the Act and the regulations thereunder or from
liability for any breach thereof.
5.02 Indemnity. Subject to the limitations contained in the Act, the Corporation
shall indemnify a director or officer, a former director or officer, or a person
who acts or acted at the Corporation's request as a director or officer of a
body corporate of which the Corporation is or was a shareholder or creditor and
his heirs and legal representatives, against all costs, charges and expenses,
including an amount paid to settle an action or satisfy a judgment, reasonably
incurred by him in respect of any civil, criminal or administrative action or
proceeding to which he is made a party by reason of being or having been a
director or officer of the Corporation or such body corporate, if
(a) he 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, he had reasonable grounds
for believing that his conduct was lawful.
The Corporation shall also indemnify such person in such other
circumstances as the Act permits or requires. Nothing in this by-law shall limit
the right of any person entitled to indemnify apart from the provisions of this
by-law.
5.03 Insurance. The Corporation may purchase and maintain insurance for the
benefit of any person referred to in section 5.02 against such liabilities and
in such amounts as the board may from time to time determine and are permitted
by the Act.
PART Vl
NOTICES
6.01 Method of Giving Notices. Any notice (which term includes any communication
or document) to be given (which term includes sent, delivered or served),
pursuant to the Act, the regulations thereunder, the articles, the by-laws or
otherwise to a shareholder, director, officer, auditor or member of a committee
of the board shall be sufficiently given if delivered personally to the person
to whom it is to be given or if delivered to his recorded address or if mailed
to him at his recorded address by prepaid transmitted or recorded communication.
A notice so delivered shall be deemed to have been given when it is delivered
personally or to the recorded address as aforesaid; a notice so mailed shall be
deemed to have been given when deposited in a post office or public letter box;
and a notice so sent by any means of transmitted or recorded communication shall
be deemed to have been given when dispatched or delivered to the appropriate
communication company or agency or its representative for dispatch. The
Secretary may change or cause to be changed the recorded address of any
shareholder, director, officer, auditor or member of a committee of the board in
accordance with any information believed by him to be reliable.
6.02 Notice to Joint Shareholders. If two or more persons are registered as
joint holders of any share, any notice shall be addressed to all of such joint
holders but notice to one of such persons shall be sufficient notice to all of
them.
6.03 Computation of Time. In computing the date when notice must be given under
any provision requiring a specified number of days' notice of any meeting or
other event, the date of giving the notice and the date of the meeting or other
event shall be excluded.
6.04 Undelivered Notices. If any notice given to a shareholder pursuant to
section 6.01 is returned on three consecutive occasions because he cannot be
found, the Corporation shall not be required to give any further notices to such
shareholder until he informs the Corporation in writing of his new address.
6.05 Omissions and Errors. The accidental omission to give any notice to any
shareholder, director, officer, auditor or member of a committee of the board or
the non-receipt of any notice by any such person or any error in any notice not
affecting the substance thereof shall not invalidate any action taken at any
meeting held pursuant to such notice or otherwise founded thereon.
6.06 Persons Entitled by Death or Operation of Law. Every person who, by
operation of law, transfer, death of a shareholder or any other means
whatsoever, shall become entitled to any share shall be bound by every notice in
respect of such share which shall have been duly given to the shareholder from
whom he derives his title to such share prior to his name and address being
entered on the securities register (whether such notice was given before or
after the happening of the event upon which he became so entitled) and prior to
his furnishing to the Corporation the proof of authority or evidence of his
entitlement prescribed by the Act.
6.07 Waiver of Notice. Any shareholder, proxyholder, other person entitled to
attend a meeting of shareholders, director, officer, auditor or member of a
committee of the board may at any time waive any notice, or waive or abridge the
time for any notice required to be given to him under any provision of the Act,
the regulations thereunder, the articles, the by-laws or otherwise and such
waiver or abridgment, whether given before or after the meeting or other event
of which notice is required to be given, shall cure any default in the giving or
in the time of such notice, as the case may be. Any such waiver or abridgement
shall be in writing except a waiver of notice of a meeting of shareholders or of
the board or of a committee of the board which may be given in any manner.
<PAGE>
ST. LAURENT PAPERBOARD INC.
ADMINISTRATIVE RESOLUTIONS
ARTICLE I
Business of the Corporation
1.01 Financial Year. The financial year of the Corporation shall end on
December 31 in each year.
1.02 Execution of Instruments. Deeds, transfers, assignments, contracts,
obligations, certificates and other instruments may be signed on behalf of the
Corporation by two persons, one of whom holds the office of Chairman of the
Board, Vice-Chairman of the Board, President, Vice-President or is a director
and the other of whom holds one of the said offices or the office of Secretary,
Treasurer, Comptroller, Assistant-Secretary, Assistant-Treasurer,
Assistant-Comptroller or any other office created by by-law or by resolution of
the board, or is a director. In addition, the board may from time to time direct
the manner in which and the person or persons by whom any particular instrument
or class of instruments may or shall be signed. Any signing officer may affix
the corporate seal to any instrument. Any signing officer may certify a copy of
any instrument, resolution, by-law or other document of the Corporation to be a
true copy thereof.
1.03 Banking Arrangements. The banking business of the Corporation including,
without limitation, the borrowing of money and the giving of security therefor,
shall be transacted with such banks, trust companies or other bodies corporate
or organizations as may from time to time be designated by or under the
authority of the board. Such banking business or any part thereof shall be
transacted under such agreements, instructions and delegations of powers as the
board may from time to time prescribe or authorize.
1.04 Voting Rights in Other Bodies Corporate. The signing officers of the
Corporation may execute and deliver proxies and arrange for the issuance of
voting certificates or other evidence of the right to exercise the voting rights
attaching to any securities held by the Corporation. Such proxies, certificates
or other evidence shall be in favour of such person or persons as may be
determined by the officers signing or arranging for them. In addition, the board
may from time to time direct the manner in which and the person or persons by
whom any particular voting rights or class of voting rights may or shall be
exercised.
<PAGE>
1.05 Company Representation for Certain Purposes. The Chairman of the Board, if
any, the Vice-Chairman of the Board, if any, the President, any Vice-President,
the Secretary, the Treasurer, the Comptroller or any other officer or person
thereunto authorized by the board is authorized and empowered to appear and make
answer for the Company to all writs, orders and questions issued out of or
authorized by any court of any jurisdiction and to declare for and on behalf of
the Corporation in answer to writs or orders of attachment by way of garnishment
in which the Corporation is garnishee and to make all affidavits and
declarations in connection therewith or in connection with any and all judicial
proceedings or other matters to which the Corporation is a party and to instruct
solicitors or counsel to act for the Corporation in bringing or defending any
action, suit or other judicial proceedings, and to make petitions for winding-up
or bankruptcy orders upon any debtor of the Corporation and to attend and vote
at all meetings of the Corporation's debtors and grant proxies in connection
therewith.
1.06 Corporate Seal. The corporate seal of the Corporation shall be
in the form shown in the margin hereof.
ARTICLE ll
Officers
2.01 Appointment. The board may from time to time appoint a Chairman of the
Board, a Vice-Chairman of the Board, a President, any or more Vice-Presidents
(to which title may be added words indicating seniority or function), a
Secretary, a Treasurer, a Controller, and such other officers as the board may
determine, including one or more assistants to any of the officers appointed.
The board may specify the duties of and, subject to the provisions of the Act,
delegate to such officers powers to manage the business and affairs of the
Corporation. Subject to section 2.02, an officer may but need not be a director
and one person may hold more than one office.
2.02 Chairman of the Board, Vice Chairman of the Board and President. If
appointed, the Chairman of the Board, the Vice-Chairman of the Board and the
President shall each be a director and shall have such powers and duties as the
board may specify.
2.03 Chief Executive Officer. The board may designate the Chairman of the Board,
the Vice-Chairman of the Board or the President as chief executive officer of
the Corporation who as such, subject to the authority of the board, shall have
general supervision over the business and affairs of the Corporation.
<PAGE>
2.04 Chief Operating Officer. The board may designate the Vice-Chairman of the
Board, the President or any Vice-President as chief operating officer who, as
such, subject to the authority of the Chief Executive Officer and the board,
shall have general supervision over the day-to-day affairs of the Corporation.
2.05 Vice-President. During the absence or disability of the President, his
duties may be performed and his powers may be exercised by the Vice-President,
or if there is more than one, by such Vice-President as shall be determined by
the board. A Vice-President shall also perform such duties and exercise such
powers as the President may from time to time delegate to him or the board may
prescribe.
2.06 Secretary. The Secretary, as and when requested to do so, shall attend and
be the secretary of all meetings of the board, shareholders, and committees and
advisory committees of the board and shall enter or cause to be entered in
records kept for that purpose minutes of all proceedings thereat; he shall give
or cause to be given, as and when instructed, all notices to directors,
shareholders, officers, auditors and members of committees of the board; he
shall be the custodian of the stamp or mechanical device generally used for
affixing the corporate seal of the Corporation and of all books, papers,
records, documents and instruments belonging to the Corporation, except when
some other officer or agent has been appointed for that purpose; and he shall
have such other powers and duties as the board may prescribe.
2.07 Treasurer. The Treasurer, if appointed, shall keep proper accounting
records in compliance with the Act and, under the direction of the board, shall
be responsible for the deposit of money, the safekeeping of securities and the
disbursement of the funds of the Corporation; he shall render to the board
whenever required an account of all his transactions as Treasurer and of the
financial position of the Corporation; and he shall have such other powers and
duties as the board may prescribe.
2.08 Controller. The Controller, if appointed, may perform any of the duties of
the Treasurer; and he shall have such other powers and duties as the board may
prescribe.
2.09 Powers and Duties of Other Officers. The powers and duties of all other
officers shall be such as the terms of their engagement call for or as the board
may prescribe. Any of the powers and duties of an officer to whom an assistant
has been appointed may be exercised and performed by such assistant, unless the
board otherwise directs.
2.10 Variation of Powers and Duties. The board may from time to time and subject
to the provisions of the Act, vary, add to or limit the powers and duties of any
officer.
2.11 Term of Office. The board, in its discretion, may remove any officer of the
Corporation, without prejudice to such officer's rights under any employment
contract. Otherwise each officer appointed by the board shall hold office until
his successor is appointed, or until his earlier resignation.
2.12 Terms of Employment and Remuneration. The terms of employment and the
remuneration of an officer appointed by the board shall be settled by it from
time to time.
<PAGE>
2.13 Declaration of Interest. An officer shall disclose his interest in any
material contract or proposed material contract with the Corporation in
accordance with the Act.
2.14 Agents and Attorneys. The board shall have power from time to time to
appoint agents or attorneys for the Corporation in or outside Canada with such
powers of management or otherwise (including the powers to subdelegate), as may
be thought fit.
2.15 Fidelity Bonds. The board may require such officers, employees and agents
of the Corporation as the board deems advisable to furnish bonds for the
faithful discharge of their powers and duties, in such form and with such surety
as the board may from time to time determine.
ARTICLE lll
Shares and Securities
3.01 Allotment. Subject to the provisions of the Act and the articles, the board
may from time to time allot and issue or grant options to purchase the whole or
any part of the authorized and unissued shares of the Corporation at such times
and to such persons and for such consideration as the board shall determine,
provided that no share shall be issued until it is fully paid as provided by the
Act.
3.02 Share Certificates. Every holder of one or more shares of the Corporation
shall be entitled, at his option, to a share certificate, or to a
non-transferable written certificate of acknowledgment of his right to obtain a
share certificate, stating the number and class or series of shares held by him
as shown on the securities register. Such certificates shall be in such form as
the board shall from time to time approve. Any such certificate shall be signed
in accordance with section 1.02 and need not be under corporate seal; provided
that, unless the board otherwise determines, certificates in respect of which a
transfer agent and/or registrar has been appointed shall not be valid unless
countersigned by or on behalf of such transfer agent and/or registrar. The
signature of one of the signing officers or, in the case of certificates which
are not valid unless countersigned by or on behalf of a transfer agent and/or
registrar, the signatures of both signing officers, may be printed or
mechanically reproduced in facsimile upon certificates and every such facsimile
signature shall for all purposes be deemed to be the signature of the officer
whose signature it reproduces and shall be binding upon the Corporation. A
certificate executed as aforesaid shall be valid notwithstanding that one or
both of the officers whose facsimile signature appears thereon no longer holds
office at the date of issue of the certificate.
<PAGE>
3.03 Securities Registers. The Corporation shall prepare and maintain at its
registered office or at any other place in Canada designated by the board, a
securities register for each class or series of securities containing such
particulars and information as is required by the Act.
3.04 Registration of Transfers. Subject to the provisions of the Act, no
transfer of securities or warrants issued by the Corporation shall be registered
in the register of transfers or a branch register of transfers except upon
presentation of the certificate representing such securities and warrants with
an endorsement, which complies with the Act, made thereon or delivered therewith
duly executed by an appropriate person as provided by the Act, together with
such reasonable assurance that the endorsement is genuine and effective as the
board may from time to time prescribe and upon payment of all applicable taxes
and any fees prescribed by the board.
3.05 Registrars and Transfer Agents. The board may from time to time appoint one
or more agents to maintain, in respect of each class of securities and warrants
of the Corporation issued by it in registered form, a central securities
register, one or more branch securities registers, a register of transfers and
one or more branch registers of transfers. In each branch register of transfers
there shall be recorded only the particulars of transfer of securities or
warrants registered at that branch; particulars of every transfer of securities
and warrants shall be recorded in the register of transfer. Such a person may be
designated as transfer agent or registrar according to his functions and one
person may be designated as both registrar and transfer agent. The board may at
any time terminate such appointment.
3.06 Replacement of Share Certificates. Upon the following conditions having
been met to the satisfaction of the President or the Secretary of the
Corporation and the solicitors of the Corporation, namely:
(a) that the Transfer Agent and Registrar of the common shares of the
Corporation (the "Transfer Agent") shall have placed a stop-transfer
order on the records of the Corporation against the share
certificate or certificates representing common shares of the
Corporation reported to have been worn out, defaced, lost, stolen or
destroyed;
(b) that the Transfer Agent has been furnished with a bond of a surety
company or other security (such bond or other security to be in
form and terms approved by the President or Secretary of the
Corporation, the Transfer Agent and the solicitors of the
Corporation) indemnifying the Corporation and the Transfer Agent
against all loss, costs and expenses of whatsoevernature and kind
which may at any time be incurred by the Company and the
Transfer Agent or either of them by reason of the issuance,
countersigning and registration of any new share certificate or
certificates representing common shares of the Corporation to
replace any share certificate or certificates reported to have
been worn out, defaced, lost, stolen or destroyed;
<PAGE>
(c) that the Corporation and the Transfer Agent have been furnished with
a statutory declaration or affidavit in form and terms approved by
the President or Secretary of the Corporation, the Transfer Agent
and the solicitors of the Corporation, verifying that the share
certificate or certificates so to be replaced was or were worn out,
defaced, lost, stolen or destroyed;
the President or the Secretary of the Corporation be and they are
hereby authorized to instruct the Transfer Agent, and the Transfer Agent, upon
receipt of such instructions, be and it is hereby authorized, to issue,
countersign and register a new certificate or certificates for the number of
common shares of the Corporation in the name of such person or persons as may be
specified in such instructions in order that such new certificate or
certificates may be issued to replace any certificate or certificates for common
shares of the Corporation of the same number as the said officer or officers in
said instructions declare they are satisfied to have been worn out, defaced,
lost, stolen or destroyed.
3.07 Joint Shareholders. If two or more persons are registered as joint holders
of any share, the Corporation shall not be bound to issue more than one
certificate in respect thereof, and delivery of such certificate to one of such
persons shall be sufficient delivery to all of them. Any one of such persons may
give effectual receipts for the certificate issued in respect thereof or for any
dividend, bonus, return of capital or other money payable or warrant issuable in
respect of such share.
3.08 Deceased Shareholders. In the event of the death of a holder, or of one of
the joint holders, of any share, the Corporation shall not be required to make
any entry in the register of transfers, a branch register of transfers of
securities register in respect thereof or to make payment of any dividend
thereon except upon production of all such documents as may be required by law
and upon compliance with the reasonable requirements of the Corporation and its
registrar and/or transfer agent.
ARTICLE IV
Remuneration of Directors.
4.01 Remuneration of Directors. Fees shall be paid to the directors of this
Corporation as follows:
(a) an annual fee of $14,000 payable in quarterly instalments, for
services as a director;
<PAGE>
(b) a meeting fee of $1,000, payable quarterly, for each meeting of the
Board of Directors attended during the quarter;
(c) an annual fee of $3,000, payable in quarterly instalments, for
services as a chairperson and Committee member of any duly
constituted Committee of the Board;
(d) an annual fee of $2,000, payable in quarterly instalments, for
services as an appointed member of any duly constituted Committee of
the Board;
(e) a meeting fee of $1,000, payable quarterly for each meeting of a
Committee of the Board attended during the quarter.
4.02 Each director of the Corporation shall be reimbursed for expenses incurred
in attending each meeting of the board or of any duly constituted committee of
the board.
4.03 The Corporation's directors, who are also employees of the Corporation, or
of any of its subsidiaries, shall not be entitled to such annual directors' fee
or to meeting fees.
ARTICLE V
Committees of the Board
5.01 Committees of the Board. The board may appoint one or more committees of
the board, however designated, and delegate to any such committee any of the
powers of the board except those which, under the Act, a committee of directors
has no authority to exercise. A majority of the members of each committee shall
be resident Canadians unless the Act permits otherwise. The board may appoint an
executive committee ("Executive Committee") and shall appoint an audit committee
("Audit Committee") in addition to any other committees.
5.02 Term of Office. Any member of a committee may be removed or replaced at any
time by the board and shall ipso facto cease to be a member of a committee upon
ceasing to be a director. The board may fill vacancies on the Executive
Committee by election from among its numbers. If and whenever a vacancy shall
exist on a committee, the remaining members may exercise all its powers so long
as a quorum remains in office. Subject to the foregoing, each member of a
committee shall hold office as such until the next annual meeting of
shareholders after his election.
<PAGE>
5.03 Procedure, Chairman, Secretary. Unless otherwise determined by the board at
the time a committee is constituted, each committee shall have power to fix its
quorum at not less than a majority of its members and to elect its chairman and
secretary. The time at which and the place where meetings of a committee shall
be held and the calling of meetings and the procedure in all things at such
meetings shall be determined by the committee. Each committee shall keep minutes
of its meetings in which shall be recorded all action taken by it. Subject to
the Act, the powers of a committee may be exercised by resolution in writing
signed by all members of the committee who would have been entitled to vote on
that resolution at a meeting of the committee and the signed resolution shall be
kept with the minutes of meetings hereinbefore referred to.
5.04 Executive Committee.
(a) The board may appoint annually from among its members, an Executive
Committee to consist of four (4) members. Three (3) members of the
Executive Committee shall constitute a quorum.
(b) The Executive Committee shall be delegated, during the intervals
between meetings of the board, all the powers of the board in
respect of the management and direction of the business and affairs
of the Corporation (save and except only those acts as must by law
be performed by the board itself) in all cases in which specific
directions shall not have been given by the board. All proceedings
of the Executive Committee shall be open to the examination of the
board and shall be reported to the board if and when the board so
directs.
(c) The Executive Committee may invite such officers, directors and
employees of the Corporation as it may see fit from time to time to
attend at meetings of the Executive Committee and assist thereat in
the discussion and consideration of the business and affairs of the
Corporation.
5.05 Audit Committee.
(a) The Board shall appoint annually from among its members an Audit
Committee which shall have the powers and duties provided in the
Act. The Audit Committee shall be composed of four (4) members who
shall not be officers or employees of the Corporation. Two (2)
members of the Audit Committee shall constitute a quorum.
(b) The members of the Audit Committee shall have the right for the
purpose of performing their duties to inspect all the books and
records of the Corporation and its affiliates and to discuss such
books and records and any matters relating to the financial position
of the Corporation with the officers and auditors of the Corporation
and its affiliates.
<PAGE>
(c) Notice of every meeting of the Audit Committee shall be given to the
auditors of the Corporation as well as to the members of the
committee and meetings of the Audit Committee shall be convened
whenever requested by the auditors in accordance with the Act as
well as by the Audit Committee.
5.06 Human Resources Management Development and Compensation Committee. The
Board shall appoint annually from among its members a Human Resources,
Management Development and Compensation Committee which shall have the powers
and duties to review, from time to time, the compensation payable to the
Directors, the performance of the officers appointed by the Board, the
Corporation's succession planning and approve or otherwise act upon the
recommendation of management on behalf of the Board, with respect to the
Corporation's incentive plans and the salaries of the officers of the
Corporation appointed by the Board. The Human Resources, Management Development
and Compensation Committee shall be composed of five (5) members. Four (4) of
the members of the Committee shall not be officers or employees of the
Corporation, any one of them may be designated as a non-voting member of the
Committee. The fifth member shall be the President and Chief Executive Officer
who will be a non voting ex-officio member of the Committee providing advice and
counsel to the Committee except when matters pertaining to his office are
discussed. Two (2) voting members of the Human Resources, Management Development
and Compensation Committee shall constitute a quorum.
5.07 Pension Fund Review Committee. The Board shall appoint annually from among
its members a Pension Fund Review Committee which shall have the powers and
duties to assist the Board in carrying out its responsibilities with respect to
the retirement plans of the Corporation. The Pension Fund Review Committee shall
be composed of four (4) members who shall not be employees of the Corporation.
Two (2) members of the Pension Fund Review Committee shall constitute a quorum.
5.08 Environment, Health and Safety Committee
(a) The Board shall appoint annually from among its members an
Environment, Health and Safety Committee. The Committee shall be
composed of three (3) members. The President and Chief Executive
Officer of the Corporation shall be ex officio a member of the
Committee. The other members shall be neither officers nor employees
of the Corporation. The Chairman of the Committee shall be
designated by the Board.
(b) The Committee shall meet at the call of its chairman or any two of
its members, and a quorum at any meeting of the Committee shall be a
majority of its members.
<PAGE>
5.09 Corporate Governance and Nominating Committee
(a) The Board shall appoint annually from any of its members, a
Corporate Governance and Nominating Committee. The Committee shall
be composed of four (4) members, three of whom shall be outside
directors. The President and Chief Executive Officer will serve as
an ex-officio non-voting member of the Committee, except for those
meetings of the Committee organized by the Chairman of the Committee
for the outside directors only. The Chairman of the Committee shall
be designated by the Board.
(b) The Committee shall meet at the call of its Chairman or any two of
its members, and the quorum at any meeting of the Committee shall be
a majority of its members . "
(c) The powers and duties (terms of Reference) of the Corporate
Governance and Nominating Committee shall be as follows:
(1) Evaluate and consider, and make recommendations to the Board of
Directors, with respect to candidates for nomination as new Board
members.
(2) Evaluate and recommend nominees for all Committees of the Board of
Directors and nomination of incumbent directors.
(3) Oversee Board of Directors and Committees of the Board of Directors'
tenure policies, as well as matters concerning questions as to what
the appropriate Committees of the Board should be and the charters
of such Committee of the Board.
(4) Oversee policies covering the resignation of incumbent directors.
(5) Evaluate annually the overall performance of the Board of Directors
and the performance of the incumbent directors.
(6) Oversee compensation policies for outside directors and members of
each Committee of the Board.
<PAGE>
(7) Evaluate, consider and make recommendations to the Board of
Directors with respect to policies involving the composition,
organization and practices of the Board, including policies with
respect to the size of the Board and the desired qualifications of
directors.
(8) Review periodically the quality, sufficiency and currency of
information furnished by management to the directors in connection
with the Board and Committee meetings and other activities of the
directors.
(9) Oversee the selection and retention of such outside advisors as may
be proposed under appropriate circumstances by directors with the
full knowledge of management.
(10) Review on a continuing basis the functioning of the Board and the
fulfillment of its legal duties, keep abreast of the latest
developments with regard to corporate governance in general and
directors' duties and responsibilities in particular, and make
recommendations to the Board in light of such matters and
developments as may be appropriate.
ARTICLE Vl
Interpretation
6.01 Interpretation, Definition. In this Administrative Resolution, unless the
context otherwise requires, terms defined or described in By-law No. I of the
Corporation, as from time to time amended, have the same meanings when used
herein; words importing the singular number include the plural and vice versa;
words importing the masculine gender include the feminine and neuter genders;
and words importing persons include individuals, bodies corporate, partnerships,
trusts and unincorporated organizations.
EXHIBIT 4.1
ST. LAURENT PAPERBOARD INC.
MANAGERS' STOCK OPTION PLAN
1. PURPOSE OF THE PLAN
The purpose of this St. Laurent Paperboard Inc. Managers'
Stock Option Plan (the "Plan") is to:
1.1 Promote a proprietary interest in St. Laurent
Paperboard Inc. (the "Corporation") among its key
employees and those of its existing or future
subsidiaries and affiliates;
1.2 Encourage them to further the development of the
Corporation, its subsidiaries and affiliates; and
1.3 Attract and retain key employees necessary for the long-term success
of the Corporation, its subsidiaries and affiliates.
2. ADMINISTRATION
The Plan shall be administered by the members of the Human Resources,
Management Development and Compensation Committee of the Board of
Directors of the Corporation (respectively, the "Committee" and the
"Board") and is subject to the general authority of the Board. The
Committee and the Board shall have full and complete authority to
interpret the Plan and to prescribe such rules and regulations and make
such other determinations as they deem necessary or desirable for the
administration of the Plan. All decisions and determinations of the
Committee and the Board respecting the Plan shall be binding and
conclusive on the Plan and its participants.
3. ELIGIBILITY AND PARTICIPATION
The Committee may, in its sole discretion, designate from time to time any
full-time managers of the Corporation and of its subsidiaries or
affiliates as participants in the Plan (the "Eligible Employees").
Initially, Eligible Employees shall be those holding the positions with
the Corporation, listed in Appendix "A" to the Plan text and to form part
thereof.
4. COMPONENT OF THE PLAN
The Plan consist in granting Eligible Employees, on an annual basis,
on-going options (the "Options") described in Section 5 hereof.
<PAGE>
5. OPTIONS
5.1 Description and Number of Securities Offered Under Options. The
securities which may be purchased pursuant to Options granted
hereunder are common shares of the Corporation (the "Shares").
Subject to Section 8, the maximum number of shares that may be
issued pursuant to the exercise of Options under this Plan shall not
exceed 500,000.
5.2 Grants of On-Going Options. The Committee shall designate from time
to time the Eligible Employees (the "On-Going Optionees") to whom a
grant of Options shall be made. The Committee shall determine, at
its discretion, the number of Shares to be covered by each such
Option and the date the grant thereof becomes effective. The number
of Shares to be covered by each such Option shall not exceed in any
one fiscal year of the Corporation a percentage of annual base
salary of the relevant On-Going Optionee to be determined from time
to time by the Committee, divided, in each case, by the exercise
price of the Options as determined in Subsection 5.4, and rounded
down to the nearest whole number. For the purposes of the Plan,
"base salary" shall mean the annual base salary of the Eligible
Employee for the applicable fiscal year at the date of grant,
excluding bonuses or any other cash or non-cash benefits of any
nature.
5.3 Value of Grants. The percentage of annual base salary of Eligible
Employees used to calculate the number of Options to be granted
shall be based on the Eligible Employee's classification and ranking
as follows:
Class Percentage of base salary
I 0 - 60%
II 0 - 30%
III 0 - 10%
In determining the percentage of base salary applicable to each
Eligible Employee in a given Class, consideration shall be given to
the individual performance rating of the Eligible Employee under the
terms of the performance evaluation program of the Corporation.
5.4 Exercise Prices. The exercise price for each Share covered by an
Option shall be the weighted average price per Share at which the
Shares traded on the Montreal Exchange and The Toronto Stock
Exchange during the period of five consecutive trading days ending
on the trading day immediately prior to the day on which the Option
was granted; for such purposes, the "weighted average price" shall
be determined by dividing the aggregate sale prices of all the
Shares sold on such exchanges during the said five day period by the
total number of Shares sold, as reported by the said exchanges.
5.5 Option Period. Unless the Committee, in its sole discretion, decides
otherwise, Options granted in any given year shall become
exercisable by the Optionee at the rate of 20% per year commencing
at the first anniversary after the date of the grant thereof; a
further 20% shall become exercisable annually every year thereafter
on the anniversary date of the date of grant; and the final 20% will
become exercisable five years after the date of the grant thereof.
<PAGE>
No Option, however, may be exercised after the tenth anniversary of
the grant thereof. An Optionee may on any date exercise part only or
all of any Option at any time during any period that it continues to
be exercisable, without prejudice to his right to exercise the
balance, if any, of the Option at subsequent times during the period
the Option continues to be exercisable.
5.6 Exercise, Payment and Issue of Shares. Exercise of any Option shall
be made by written notice to the Secretary of the Corporation
setting forth the number of Shares with respect to which the Option
is being exercised and specifying the address to which the
certificate evidencing such Shares is to be delivered. Such notice
shall be accompanied by a certified cheque made payable to the
Corporation in the amount of the exercise price. The Corporation
shall cause a certificate for the number of Shares specified in the
notice to be issued in the name of the Optionee and delivered to the
address specified in the notice not later than five business days
following receipt of such notice and cheque.
5.7 Termination of Employment. When an Optionee ceases to be an employee
of the Corporation, a subsidiary or an affiliate thereof, the
Optionee, or the Optionee's estate in the case of death, shall have
the right to exercise all Options granted to the Optionee which, as
granted, could be exercised on the date his employment ceased at any
time within a period of twelve months after the Optionee ceased to
be an employee, provided that such exercise shall be prior to the
expiry of the maximum period established for the exercise of such
Option. However, if the Optionee has resigned his employment or if
the employment of the Optionee has been terminated by the employer
for cause, the Optionee shall have no such right with respect to
unexercised Options and all such unexercised Options previously
granted to an Optionee shall become void immediately upon the
termination of employment.
6. QUANTITATIVE RESTRICTION
Notwithstanding anything to the contrary herein provided: (i) the
majority of Shares reserved for issuance pursuant to Options under the
Plan shall not be issued to insiders of the Corporation (ii) the total
number of Shares reserved for issuance pursuant to Options under the Plan
and under all employee options shall not exceed 10% of the issued Shares;
(iii) the maximun number of Shares that may be reserved for issuance to
any one person pursuant to the exercise of Options granted hereunder or
options under any other plans shall not exceed 5% of Shares issued and
outstanding at the time of the grant; and (iv) the number of Shares which
may be issued under the Plan and other share compensation plans of the
Corporation in a one-year period shall not exceed (a) to insiders of the
Corporation, in the aggregate, 10% of the issued Shares, or (b) to any one
insider and such insider' associates, 5% of the issued Shares. For
purposes hereof, the term "insiders" shall have the meaning assigned
thereto under the rules of the Montreal and Toronto stock exchanges
relating to share compensation arrangements.
<PAGE>
7. DURATION, AMENDMENT OR TERMINATION OF PLAN
Subject to Section 9, the Board may amend or terminate the Plan at any
time but in any such event, the rights of Eligible Employees related to
any granted but unexercised Options, shall be fully preserved and
maintained. The Board may amend the text of the Plan to correct or rectify
any ambiguities, defective provisions, errors or omissions herein,
provided that, in the opinion of the legal counsel, the rights of the
Eligible Employees and the shareholders of the Corporation are in no way
prejudiced thereby.
8. SUBDIVISION, CONSOLIDATION, CONVERSION OR RECLASSIFICATION
In the event that the Shares are subdivided, consolidated, converted or
reclassified by the Corporation, or that any other action of a similar
nature affecting such Shares is taken by the Corporation, the Shares
issued or issuable under this Plan shall be appropriately increased or
decreased, converted or reclassified, and the total number of Shares
reserved for issuance under this Plan shall be adjusted in the same
manner. Such adjustment shall be made by the Committee, in its sole
discretion and subject to the requirements of applicable regulatory
authorities, and any determination by the Committee with respect to such
adjustment shall be conclusive and binding for all purposes of the Plan.
9. NECESSARY APPROVALS
Any grant of Options by the Corporation and the Corporation's obligation
to issue and deliver any Shares in accordance with this Plan, as well as
any amendment thereto, is subject to any required approval of regulatory
authorities having jurisdiction over the Shares (including any stock
exchanges on which the Shares are listed).
10. RIGHTS NON-ASSIGNABLE
The rights of an Eligible Employee pursuant to the provisions of this Plan
are non-assignable, including by way of collateral or security for any
obligation of the Eligible Employee, other than in favour of the
Corporation as expressly provided herein.
11. GOVERNING LAW
The provisions of the Plan shall be interpreted in accordance with the
laws of the Province of Quebec.
<PAGE>
12. MISCELLANEOUS
12.1 The participation of an individual in the Plan is at the sole
discretion of the Committee, and the provisions of the Plan, any
past practices of the Committee or the Board and any rules,
regulations or decisions related to the Plan by the Committee or the
Board shall not be interpreted as conferring upon any such
individual any rights or privileges other than those rights and
privileges expressly provided hereby and expressly granted by the
Committee.
12.2 The Plan does not provide any guarantee against any loss or profit
which may result from fluctuations in the market price of the
Shares.
February 3, 1999
EXHIBIT 4.2
ST. LAURENT PAPERBOARD INC.
MANAGERS' SHARE PURCHASE PLAN
1. PURPOSE OF THE PLAN
The purpose of this St. Laurent Paperboard Inc. Managers' Share
Purchase Plan (the "Plan") is to:
1.1 promote a proprietary interest in St. Laurent Paperboard Inc.
(the "Corporation") among certain managers of the Corporation and
of its existing or future subsidiaries and affiliates;
1.2 encourage them to further the development of the Corporation, its
subsidiaries and affiliates; and
1.3 attract and retain managers necessary for the long-term success of
the Corporation, its subsidiaries and affiliates.
2. ADMINISTRATION
The Plan shall be administered by the members of the Human Resources,
Management Development and Compensation Committee of the Board of
Directors of the Corporation (respectively, the "Committee" and the
"Board") and is subject to the general authority of the Board. The
Committee and the Board shall have full and complete authority to
interpret the Plan and to prescribe such rules and regulations and make
such other determinations as they deem necessary or desirable for the
administration of the Plan. All decisions and determinations of the
Committee and the Board respecting the Plan shall be binding and
conclusive on the Plan and its participants.
3. ELIGIBILITY AND PARTICIPATION
The Committee may, in its sole discretion, designate any full-time
managers of the Corporation, its subsidiaries or affiliates as
participants in the Plan (the "Eligible Employees"). Eligible Employees
shall be those holding the positions outlined in Exhibit "A" hereto from
time to time.
4. COMPONENTS OF THE PLAN
The Plan shall be composed of two components: (i) the share purchase offer
described in Section 5 hereof (the "Share Purchase Offer"); and (ii) the
restricted share units ("RSUs") described in Section 6 hereof.
<PAGE>
5. SHARE PURCHASE OFFER
5.1 Description and Number of Securities Offered under the Share
Purchase Offer. The securities which may be purchased and
distributed pursuant to the Share Purchase Offer are common shares
of the Corporation (the "Shares"). The maximum number of Shares that
may be issued pursuant to the Share Purchase Offer shall not exceed
200,000.
5.2 Share Purchase Offer. The Eligible Employees shall be entitled to
purchase a number of Shares ("Management Shares"), equal to the
percentage of the annualized base salary of each such Eligible
Employee (as determined in Exhibit "A") as at January 1st of the
year of the purchase of the Management Shares divided, in each case,
by the price at which Management Shares may be purchased under the
Share Purchase Offer pursuant to Subsection 5.3, and rounded down to
the nearest whole number.
5.3 Price of Shares. The price per Share at which Management Shares may
be purchased shall be 90% of the Market Price of the Shares (for the
purposes hereof, "Market Price" means on any purchase date the
weighted average of the trading price of a board lot of 100 Shares
on The Toronto Stock Exchange for the five trading day period ending
on the last business day before the purchase date) provided that the
Eligible Employee (i) remains in the continuous employment of the
Corporation, a subsidiary or an affiliate thereof for a period of
two years after the date he purchased the Management Shares, and
(ii) does not sell, transfer or otherwise alienate in any manner the
Management Shares so purchased for a period of two years after the
date of purchase. If the Eligible Employee ceases to be employed by
the Corporation, a subsidiary or an affiliate thereof within such
period or purports to sell, transfer or assign Management Shares
within such period, the Eligible Employee shall pay the Corporation
an amount equal to 10% of the Market Price of the Shares (as
liquidated damages, and not as a subscription price upon issuance of
the Shares) multiplied by the aggregate number of Management Shares
purchased by such Eligible Employee or, in the case of a sale,
transfer or assignment of Management Shares without the Eligible
Employee ceasing to be employed by the Corporation, a subsidiary or
an affiliate thereof, multiplied by the aggregate number of
Management Shares so sold, transferred or assigned (the "Penalty"),
and the Trustee (as defined below) shall not deliver any such
Management Shares to or to the order of the Eligible Employee until
the Corporation has received a certified cheque for such amount.
<PAGE>
5.4 Participation in the Share Purchase Offer. In order to participate
in the Share Purchase Offer, Eligible Employees must have returned a
properly completed subscription form in the form and within the time
period set out as Exhibit "B" hereto to the Secretary of the
Corporation. If the Secretary of the Corporation has not received
the properly completed form in respect of any Eligible Employee,
such Eligible Employee shall not be entitled to participate in the
Share Purchase Offer. If, in respect of any Eligible Employee, a
properly completed form is received, such Eligible Employee is
entitled to purchase the number of Management Shares indicated in
such subscription form, up to but not to exceed such Eligible
Employee's entitlement to participate in the Share Purchase Offer
calculated in accordance with Subsection 5.2.
5.5 Payment. The properly completed subscription form shall be
accompanied by (i) a certified cheque made payable to the
Corporation in the amount of the aggregate purchase price for the
Management Shares the Eligible Employee elected to purchase, or (ii)
in the event the Eligible Employee elects to obtain financial
assistance pursuant to Subsection 5.7, an indication on the
subscription form that the Eligible Employee so elects in the space
reserved for such purpose. The Corporation shall cause a certificate
for the number of Management Shares specified in the subscription
form to be issued in the name of the Trustee and delivered to the
Trustee on behalf of the Eligible Employee not later than five
business days following the receipt of such notice and, if
applicable, the Eligible Employee's certified cheque. The Secretary
of the Corporation shall act as escrow agent with respect to
Management Shares purchased by such Eligible Employee in accordance
with Subsection 5.6 (in such capacity, referred to in this Section 5
as the "Trustee").
5.6 Escrow. The Trustee shall hold the Management Shares purchased by an
Eligible Employee pursuant to this Section 5 in escrow and such
Management Shares shall not be transferred to the Eligible Employee
or to any other person until the later of (i) repayment in full of
any loan granted to or to the benefit of such Eligible Employee to
assist in the purchase of such Management Shares pursuant to
Subsection 5.7 (the "Eligible Employee Loan"), and (ii) two years
after the date such Eligible Employer purchases the Management
Shares in accordance with Subsection 5.5, (the "Retention Period").
<PAGE>
Notwithstanding the foregoing, in the event an Eligible Employee
wishes to sell, transfer or otherwise alienate Management Shares
prior to the expiry of the Retention Period and the Eligible
Employee has not ceased to be an employee of the Corporation, a
subsidiary or an affiliate thereof, the Trustee shall release such
number of Management Shares from escrow as the Eligible Employee
wishes to sell, transfer or otherwise alienate prior to the expiry
of the Retention Period, provided that the Eligible Employee has
first repaid the proportion of the Eligible Employee Loan that such
Management Shares are of all Management Shares purchased by the
Eligible Employee and has paid any Penalty (as defined in Subsection
5.7) with respect to such Management Shares. During the Retention
Period, all rights with respect to the Management Shares held by the
Trustee on behalf of an Eligible Employee, including voting rights,
shall be exercisable by the Eligible Employee, and any dividends
payable on such Management Shares shall be paid to the Eligible
Employee, subject to any application of dividends to repayment of
any loan pursuant to Subsection 5.7. At the expiry of the Retention
Period, the Management Shares shall be transferred by the Trustee to
the Eligible Employee and registered in the name of the Eligible
Employee.
5.7 Financial Assistance. An Eligible Employee may apply to the
Corporation for a loan in an amount necessary to permit the Eligible
Employee to purchase, from the Corporation, the Management Shares
which the Eligible Employee has elected to purchase under the Share
Purchase Offer. To apply for a loan, the Eligible Employee must, at
the time of delivery of his subscription form to the Secretary of
the Corporation, have so indicated on the subscription form in the
space reserved for such purpose. The whole or any part of the loan
may be granted by the Corporation, in its discretion, subject to
applicable laws and such terms and conditions as the Board may, in
its sole discretion, stipulate, or arranged by the Corporation to be
made by a third party acceptable to the Corporation on such terms
and conditions as the Board may, in its sole discretion, agree. The
Corporation shall charge no interest or fees with respect to any
loan made by it hereunder and, if a loan is arranged by the
Corporation with a third party, shall bear all interest charges and
fees with respect thereto. The entire amount of any loan granted to
an Eligible Employee pursuant to the provisions of this Subsection
5.7 shall be used solely for the purchase of Management Shares from
the Corporation under the Share Purchase Offer in accordance with
the Plan. Any outstanding principal amount of such loan shall be
repayable by the Eligible Employee, and the Corporation may, in its
sole discretion, effect such payment from any proceeds of any sale,
transfer or other alienation by the Eligible Employee of Management
Shares held by the Trustee, any dividends declared and paid on such
<PAGE>
Management Shares, any moneys payable to the Eligible Employee with
respect to RSUs pursuant to Subsection 6.3 and 25% of any gross
bonus granted to the Eligible Employee under the Corporation's
Short-Term Incentive Plan. The Eligible Employee shall be deemed to
have agreed that the Corporation shall have, and shall have been
deemed to have granted, by his application for any such loan, a
first-ranking charge, hypothec and security interest over the
Management Shares held by the Trustee to the account of the Eligible
Employee as well as over the proceeds of any such sale, transfer or
alienation, such dividends, such moneys and such other amounts.
5.8 Termination of Employment. When an Eligible Employee ceases to be an
employee of the Corporation, a subsidiary or an affiliate thereof,
whether before or after the expiry of the Retention Period, the
Eligible Employee, or the Eligible Employee's estate in the case of
death, shall have the right to receive from the Trustee the
Management Shares purchased by him under the Share Purchase Offer
and held by the Trustee, subject to the prior repayment by or on
behalf of the Eligible Employee or the Eligible Employee's estate,
as the case may be, in full repayment of the outstanding balance on
any loan given to the Eligible Employee pursuant to Subsection 5.7
and, if applicable, any Penalty, in the event of termination for
cause or resignation, within thirty (30) days of the Eligible
Employee ceasing employment, and in any other case, within six (6)
months following the date on which the Eligible Employee ceased such
employment. If the full amount of the outstanding balance of such
loan and any Penalty has not been repaid within such period, the
Corporation shall be authorized to sell such Eligible Employee's
Management Shares and to apply the net proceeds of such sale to the
repayment of the loan and any Penalty.
5.9 Use of Proceeds. The Corporation will use the proceeds of the sale
of the Management Shares purchased by Eligible Employees for general
corporate purposes.
<PAGE>
6. Restricted Share Units
6.1 Rights to Restricted Share Units. Effective on the date an Eligible
Employee purchases Management Shares pursuant to the Share Purchase
Offer, such Eligible Employee shall receive one RSU for every two
Management Shares purchased by such Eligible Employee under the
Share Purchase Offer. The securities which may be issued pursuant to
RSUs are Shares. Subject to Section 9, the maximum number of Shares
that may be issued pursuant to RSUs shall not exceed 100,000.
6.2 Forfeiture of RSUs. If an Eligible Employee sells, transfers or
otherwise alienates Management Shares prior to the expiry of a
three-year period following the issuance of such Management Shares
(the "Qualifying Period"), one RSU shall be immediately forfeited by
the Eligible Employee for every two such Management Shares which are
so sold, transferred or otherwise alienated. If an Eligible Employee
ceases, at any time prior to the expiry of the Qualifying Period, to
be continuously employed by the Corporation, a subsidiary or an
affiliate thereof for any reason whatsoever, the Eligible Employee
shall immediately forfeit all the RSUs held by such Eligible
Employee. The Secretary of the Corporation shall be entitled, acting
in his sole discretion, to require satisfactory evidence from the
Eligible Employee that the Eligible Employee has maintained
ownership of the applicable Management Shares prior to authorizing
the payment of any cash pursuant to Subsection 6.3 or the issuance
of any Shares pursuant to Subsection 6.4.
6.3 Cash Payments on RSUs. Each holder of an RSU shall be entitled to
receive from the Corporation cash payments equal to any cash
dividends declared and paid to the holder of a Share, other than
dividends declared and paid not in the ordinary course of business,
during the period the Eligible Employee held such RSU; such amounts
shall be payable contemporaneously with the payment of such cash
dividends on the Shares. The right of a holder of RSUs to receive
such cash payment shall be subordinated in all respects to the
rights of the holders of Shares to receive dividends as and when
legally declared and paid.
6.4 Entitlement to Shares. Each RSU held by an Eligible Employee on the
third anniversary of the date the Eligible Employee purchased
Management Shares shall immediately entitle the holder thereof to
receive, and the Corporation shall be obliged to issue, one Share of
the Corporation without payment of any further consideration by the
Eligible Employee.
<PAGE>
7. QUANTITATIVE RESTRICTION
Notwithstanding anything to the contrary herein provided, the majority of
Shares to be allocated under the Plan must not be issuable to insiders,
and the number of Shares which may be issued under the Plan and other
share compensation plans of the Corporation in a one-year period shall not
exceed (a) 10% of the issued Shares, or (b) to any one insider and such
insider's associates, 5% of the issued Shares.
8. DURATION, AMENDMENT OR TERMINATION OF PLAN
Subject to Section 10, the Board may amend or terminate the Plan at any
time but in any such event, the rights of Eligible Employees related to
any Management Shares purchased under the Share Purchase Offer and RSUs
shall be fully preserved and maintained . The Board may amend the text of
the Plan to correct or rectify any ambiguities, defective provisions,
errors or omissions herein, provided that, in the opinion of the legal
counsel, the rights of the Eligible Employees and the shareholders of the
Corporation are in no way prejudiced thereby.
9. SUBDIVISION, CONSOLIDATION, CONVERSION OR RECLASSIFICATION
In the event that the Shares are subdivided, consolidated, converted or
reclassified by the Corporation, or that any other action of a similar
nature affecting such Shares is taken by the Corporation, the Shares and
RSUs issued or issuable under this Plan shall be appropriately increased
or decreased, converted or reclassified, and the total number of Shares
reserved for issuance under this Plan shall be adjusted in the same
manner. Such adjustment shall be made by the Committee, in its sole
discretion and subject to the requirements of applicable regulatory
authorities, and any determination by the Committee with respect to such
adjustment shall be conclusive and binding for all purposes of the Plan.
10. NECESSARY APPROVALS
The Corporation's obligation to issue and deliver any Shares in accordance
with this Plan, as well as any amendment thereto, is subject to any
required approval of regulatory authorities having jurisdiction over the
Shares (including any stock exchanges on which the Shares are listed).
<PAGE>
11. RIGHTS NON-ASSIGNABLE
The rights of an Eligible Employee pursuant to the provisions of this Plan
are non-assignable, including by way of collateral or security for any
obligation of the Eligible Employee, other than in favour of the
Corporation as expressly provided herein.
12. GOVERNING LAW
The provisions of the Plan shall be interpreted in accordance with the
laws of the Province of Quebec.
13. INCOME TAX CONSEQUENCES
The following is a summary of the principal Canadian income tax
considerations generally applicable to Eligible Employees who are
residents of Canada. This summary is based upon the current provisions of
the tax legislation and regulations, all specific proposals to amend such
legislation and regulations publicly announced by governmental authorities
prior to the date hereof and the current administrative practices of the
tax authorities.
Eligible Employees who participate in the Plan should consult their own
tax advisors with respect to their particular circumstances.
Share Purchase Offer
Discount
Due to the fact that an Eligible Employee must hold his or her Management
Shares for at least a two-year period following their purchase, the 10%
discount on the market price obtained by an Eligible Employee under the
Plan on the purchase of Management Shares should not give rise to a
taxable benefit to the Eligible Employee.
Dividends
Dividends received on Management Shares acquired under the Plan will be
subject to tax as dividends received from a taxable Canadian corporation.
The normal gross-up and dividend tax credit rules will apply. Eligible
Employees will receive each year a T-5 slip (or Releve-3 for Quebec
provincial income tax purposes) reporting the appropriate amounts.
<PAGE>
Disposition of Shares
An Eligible Employee who disposes of his or her Management Shares acquired
under the Plan will realize a capital gain (or a capital loss) to the
extent that the proceeds of disposition received for such Management
Shares exceed (or are exceeded by) the adjusted cost base of such
Management Shares and the expenses related to the disposition. The portion
of capital gains (or capital loss) which is included in taxable capital
gains (or allowable capital losses) is three-quarters.
The adjusted cost base of the Management Shares of an Eligible Employee
will generally be the average cost to the Eligible Employee of all his or
her shares whether acquired under the Plan or otherwise.
The cost of Management Shares purchased under the Plan will be the price
actually paid for such Management Shares.
An allowable capital loss realized upon the disposition of Management
Shares can only be deducted against taxable capital gains. Such loss can
be carried back three years and carried forward indefinitely.
Interest-free loan
Eligible Employees who acquire Management Shares will be deemed to receive
a taxable benefit based on the rate of interest prescribed for this
purpose from time to time under the income tax legislation. Such amount,
however, will be deemed to be interest paid for purposes of earning income
and, thus, will generally be deductible in computing income as long as the
Eligible Employee holds the Management Shares acquired with the loan.
Withdrawal of Shares
The withdrawal of Management Shares from the Plan will not be treated as a
disposition of such Management Shares for tax purposes.
Quebec Stock Savings Plan
The Management Shares are not eligible for inclusion in a Quebec Stock
Savings Plan.
Restricted Share Units
Issuance of RSUs
The issuance of RSUs will not as such be considered a taxable benefit.
Cash Payments on RSUs
Cash payments made under the Plan to Eligible Employees holding RSUs will
be treated as employment income for such Eligible Employees.
<PAGE>
Issuance of Shares
Eligible Employees holding RSUs and receiving Shares of the Corporation on
the third anniversary of the purchase of Management Shares will be deemed
to have received a taxable benefit equal to the fair market value of the
Shares so received at the time such Shares are received.
Dividends, Disposition of Shares and Quebec Stock Savings Plan
The rules described above for the Share Purchase Offer also apply, mutatis
mutandis, to the dividends received on the Shares issued under the RSUs
and to the disposition of such Shares.
The cost of Shares acquired under the RSUs will be nil.
14. MISCELLANEOUS
14.1 The participation of an individual in the Plan is at the sole
discretion of the Committee, and the provisions of the Plan, any
past practices of the Committee or the Board and any rules,
regulations or decisions related to the Plan by the Committee or the
Board shall not be interpreted as conferring upon any such
individual any rights or privileges other than those rights and
privileges expressly provided hereby and expressly granted by the
Committee.
14.2 The Plan does not provide any guarantee against any loss or profit
which may result from fluctuations in the market price of the
Shares.
14.3 The Plan comes into effect upon final approval of all applicable
regulatory authorities.
A copy of the latest audited consolidated financial statements of the
Corporation has been sent to all employees of the Corporation.
Montreal, Quebec, February 10, 1997
ST-LAURENT PAPERBOARD INC.
/s/ Marion Allaire
Marion Allaire,
Vice-President, Administration and
Secretary
<PAGE>
EXHIBIT "A"
Eligible Employee Percentage of Base Salary
General Superintendent - La Tuque 33 1/3
Manager Quality Insurance - La Tuque 33 1/3
Manager Services - La Tuque 33 1/3
Controller - La Tuque 33 1/3
Manager, Human Resources - La Tuque 33 1/3
Mill Manager - Matane 66 2/3
Superintendent Woodyard & Fibre Supply - Matane 33 1/3
Controller & Superintendent 33 1/3
Occupational Environment - Matane
Maintenance Superintendent - Matane 33 1/3
Production Superintendent - Matane 33 1/3
Superintendent, Customer Service - Matane 33 1/3
Manager, Production - Containers 33 1/3
Manager, Finance and Management 33 1/3
Information System - Containers
Manager, Operations - Montreal (P.A.T.) 33 1/3
Manager, Development Containers - 33 1/3
Montreal (P.A.T.) Director, Environment - 33 1/3
Montreal (Head Office)
<PAGE>
EXHIBIT "B"
ST. LAURENT PAPERBOARD INC.
MANAGERS' SHARE PURCHASE PLAN
SUBSCRIPTION FORM
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PLEASE PRINT
Personal Information
- --------------------------------------------- -------------------------
Given Name(s) Family Name Social Ins. No
- --------------------------------------------- -------------------------
Home Address Apt. # Employee No
( )
- --------------------------------------------- -------------------
City Postal Code Telephone
- -------------------------------------------------------------------------------
APPLICATION DEADLINE: __, 199__
Share Purchase
I apply to purchase $ worth of Management Shares at a price of $o per share
subject to the terms and conditions of the Share Purchase Offer set out in the
St. Laurent Paperboard Inc. Managers' Share Purchase Plan.
I understand that if I cease to be an employee of St. Laurent Paperboard Inc.
("St. Laurent"), subsidiaries or affiliates thereof within a period of two years
from the date I have purchased the Management Shares, or if I have sold,
transferred or otherwise alienated the Management Shares within such period, I
shall be required to pay to St. Laurent, as liquidated damages, an amount equal
to $o per Management Share multiplied by the aggregate number of Management
Shares purchased by me or, in the case of a sale, transfer or assignment of the
Management Shares without my ceasing to be employed by St. Laurent, a subsidiary
or affiliate thereof, multiplied by the aggregate number of Management Shares so
sold, transferred or assigned. I also understand that one Restricted Share Unit
will be forfeited by me for every two Management Shares sold, transferred or
otherwise alienated by me prior to the expiry of a three-year period following
the issuance of such Management Shares, and that all Restricted Share Units held
by me shall be immediately forfeited if, at any time during such three-year
period, I cease to be an employee of St. Laurent, a subsidiary or affiliate
thereof for any reason whatsoever.
<PAGE>
I understand that the Management Shares will be registered in the name of the
Trustee (as defined in the Plan) during the period of two years from the date of
purchase of the Management Shares.
Reference is made to the St. Laurent Managers' Share Purchase Plan for a full
description of the terms and conditions of the issuance of the Management
Shares. If there is any inconsistency between the St. Laurent Managers' Share
Purchase Plan and this Subscription Form, the terms and conditions of the St.
Laurent Managers' Share Purchase Plan shall prevail.
Payment (Please check (X) one box only)
______ I attach a certified cheque or money order payable in Canadian
dollars to St. Laurent in the amount of $ in payment in full for
the Management Shares I have applied for.
OR
_____ on my behalf a loan from a third person, an amount of $ to purchase the
Management Shares I have applied for. If this loan is from a third party,
I acknowledge that St. Laurent will bear all interest and fees with
respect to such loan. I declare that I am indebted to St. Laurent or the
third party, as the case may be, and agree to execute a demand Promissory
Note in favour of St. Laurent or the third party, as the case may be, for
the said amount. I authorize St. Laurent to deduct this amount from (i)
proceeds of any sale, transfer or other alienation of my Management
Shares, (ii) any dividends declared and paid on such Management Shares,
(iii) any moneys payable to me with respect to Restricted Share Units, and
(iv) 25% of any gross bonus granted to me under the St. Laurent Short-Term
Incentive Plan. I agree that St.Laurent will have a first-ranking charge,
hypothec and security interest over the Management Shares held by the
Trustee to my account as well as over the proceeds of any such sale,
transfer or alienation, such dividends, such moneys and such other
amounts.
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Declaration
I declare that all of the above information is accurate.
- ------------------------------------- --------------------------
Signature Date
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EXHIBIT 4.3
ST. LAURENT PAPERBOARD INC. LONG-TERM INCENTIVE PLAN
1. PURPOSE OF THE PLAN
The purpose of this St-Laurent Paperboard Inc. Long-Term Incentive Plan
(the "Plan") is to:
1.1 promote a proprietary interest in St. Laurent Paperboard Inc.
(the "Corporation") among its executives and other key employees
and those of its existing or future subsidiaries and affiliates;
1.2 encourage them to further the development of the Corporation, its
subsidiaries and affiliates; and
1.3 attract and retain key employees necessary for the long-term success
of the Corporation, its subsidiaries and affiliates.
2. ADMINISTRATION
The Plan shall be administered by the members of the Human Resources, Management
Development and Compensation Committee of the Board of Directors of the
Corporation (respectively, the "Committee" and the "Board") and is subject to
the general authority of the Board. The Committee and the Board shall have full
and complete authority to interpret the Plan and to prescribe such miles and
regulations and make such other determinations as they deem necessary or
desirable for the administration of the Plan. All decisions and determinations
of the Committee and the Board respecting the Plan shall be binding and
conclusive on the Plan and its participants.
3. ELIGIBILITY AND PARTICIPATION
The Committee may, in its sole discretion, designate any full-time executive
officers or senior managers of the Corporation, subsidiaries or affiliates as
participants in the Plan (the "Eligible Employees"). Initially, Eligible
Employees shall be those holding the following positions with the Corporation:
the President and Chief Executive Officer of the Corporation; the
Vice-President, Finance and Chief Financial Officer; the Vice-President,
Marketing; the Vice-President, Sales; the Vice-President Administration and
Secretary; the Vice-President, La Tuque Operations; the Vice-President,
Container Operations; the Vice-President, Matane Operations; the Vice-President,
Montreal Operations; the Controller; the Manager, Engineering and Technology;
the Manager, Human Resources; the Manager, Operations Planning; and the Manager,
Woodlands.
<PAGE>
4. COMPONENTS OF THE PLAN
The Plan shall be composed of three components: (i) the options (the "Options"),
including the on-going options (the "On-Going Options") and one-time options
(the "One-Time Options"), described in Section 5 hereof; (ii) the share purchase
offer described in Section 6 hereof (the "Share Purchase Offer"); and (iii) the
restricted share units ("RSUs") described in Section 7 hereof.
5. OPTIONS
5.1 Description and Number of Securities Offered Under Options. The
securities which may be purchased pursuant to Options granted
hereunder are common shares of the Corporation (the "Shares").
Subject to Section 10, the maximum number of Shares that may be
issued pursuant to the exercise of Options under this Plan shall not
exceed 1,031,684.
5.2 Grants of On-Going Options. The Committee shall designate from time
to time the Eligible Employees (the "On-Going Optionees") to whom a
grant of On-Going Options shall be made. The Committee shall
determine, at its discretion, the number of Shares to be covered by
each such On-Going Option and the date the grant thereof becomes
effective. The number of Shares to be covered by each such On-Going
Option shall not exceed in any one fiscal year of the Corporation a
percentage of annual base salary of the relevant On-Going Optionee
to be determined from time to time by the Committee, divided, in
each case, by the exercise price of the On-Going Options as
determined in Subsection 5.4, and rounded down to the nearest whole
number. For the purposes of the Plan, "base salary" shall mean the
annual base salary of the Eligible Employee for the applicable
fiscal year, excluding bonuses or any other cash or non-cash
benefits of any nature.
5.3 Grants of One-Time Options. Effective on the closing of the initial
public offering of Units of the Corporation (each Unit composed of
200 Shares and an equal dollar amount of 8% convertible unsecured
subordinated debentures) (the " IPO "), each Eligible Employee ("
One-Time Optionee ") may be granted a One-Time Option on a number of
Shares equal to the percentage listed below of the annualized 1994
base salary of such One-Time Optionee divided, in each case, by the
exercise price of the One-Time Options set out in Subsection 5.4
below:
<PAGE>
One-Time Optionee Percentage of Base Salary
President and CEO 400%
VP, Finance and CFO 200%
VP, Marketing 200%
VP, Sales 200 %
VP, Administration and Secretary 200%
VP, La Tuque Operations 200%
VP, Container Operations 100%
VP, Matane Operations 200%
VP, Montreal Operations 200%
Controller 200%
Manager, Engineering and 100%
Technology
Manager, Human Resources 100%
Manager, Operations Planning 100%
Manager, Woodlands 100%
One-Time Optionees and On-Going Optionees are hereinafter sometimes
referred to together as "Optionees".
5.4 Exercise Prices. The exercise price for. each Share covered by an
On-Going Option shall be the weighted average price per Share at
which the Shares traded on the Montreal Exchange and The Toronto
Stock Exchange during the period of five consecutive trading days
ending on the trading day immediately prior to the (lay on which the
On-Going Option was granted; for such purposes, the It weighted
average price" shall be determined by dividing the aggregate sale
prices of all the Shares sold on such exchanges during the said five
day period by the total number of Shares sold, as reported by the
said exchanges. The exercise price for each Share covered by a
One-Time Option shall be the price per Share allocated to the Shares
comprised in the Units distributed at the closing of the IPO ('the
"Public Offering Price").
<PAGE>
5.5 Option Period. Unless the Committee, in its sole discretion, decides
otherwise, one-third of each Option shall become exercisable by the
Optionee three years after the date of the grant thereof; a further
one-third shall become exercisable four years after the date of the
grant thereof; and the final one-third will become exercisable five
years after the date of the grant thereof. No Option, however, may
be exercised after the tenth anniversary of the grant thereof. An
Optionee may on any date exercise part only or all of any Option at
any time during any period that it continues to be exercisable,
without prejudice to his right to exercise the balance, if any, of
the Option at subsequent times during the period the Option
continues to be exercisable.
5.6 Exercise, Payment and Issue of Shares. Exercise of any Option shall
be made by written notice to the Secretary of the Corporation
setting forth the number of Shares with respect to which the Option
is being exercised and specifying the address to which the
certificate evidencing such Shares is to be delivered. Such notice
shall be accompanied by a certified cheque made payable to the
Corporation in the amount of the exercise price. The Corporation
shall cause a certificate for the number of Shares specified in the
notice to be issued in the name of the Optionee and delivered to the
address specified in the notice not later than five business days
following receipt of such notice and cheque.
5.7 Termination of Employment. When an Optionee ceases to be an employee
of the Corporation, a subsidiary or an affiliate thereof, the
Optionee, or the Optionee's estate in the case of death, shall have
the right to exercise all Options granted to the Optionee which, as
granted, could be exercised on the date his employment ceased at any
time within a period of' twelve months after the Optionee ceased to
be an employee, provided that such exercise shall be prior to the
expiry of the maximum period established for the exercise of such
Option. However, if the Optionee has resigned his employment or if
the employment of the Optionee has been terminated by the employer
for cause, the Optionee shall have no such right with respect to
unexercised Options and an such unexercised Options previously
granted to an Optionee shall become void immediately upon the
termination of employment.
6. SHARE PURCHASE OFFER
6.1 Description and Number of Securities Offered under the Share
Purchase Offer. The securities which may be purchased and
distributed pursuant to the Share Purchase Offer are Shares. The
maximum number of Shares that may be issued pursuant to the Share
Purchase Offer shall not exceed 104,022.
<PAGE>
6.2 Share Purchase Offer. The Eligible Employees shall be entitled to
purchase a number of Shares ("Executive Shares"), any time on the
date, or within five business days, of the closing of the IPO, equal
to the percentage of the 1994 annualized base salary of each such
Eligible Employee, listed below, divided, in each case, by the price
at which Executive Shares may be purchased under the Share Purchase
Offer pursuant to Subsection 6.3, and rounded down to the nearest
whole number:
One-Time Optionee Percentage of Base Salary
President and CEO 120%
VP, Finance and CFO 66 2/3 %
VP, Marketing 66 2/3 %
VP, Sales 66 2/3 %
VP, Administration and Secretary 66 2/3 %
VP, La Tuque Operations 66 2/3 %
VP, Container Operations 66 2/3%
VP, Matane Operations 66 2/3 %
VP, Montreal Operations 66 2/3%
Controller 66 2/3 %
Manager, Engineering and 50%
Technology
Manager, Human Resources 50%
Manager, Operations Planning 50%
Manager, Woodlands 50%
6.3 Price of the Shares. The price per Share at which Executive Shares
may be purchased shall be 90% of the Public Offering Price, provided
that the Eligible Employee (i) remains in the continuous employment
of the Corporation, a subsidiary or an affiliate thereof for a
period of two years after the date he purchased the Executive
Shares, and (ii) does not sell, transfer or otherwise alienate in
any manner the Executive Shares so purchased for a period of two
years after the date of purchase. If the Eligible Employee ceases to
<PAGE>
be employed by the Corporation, a subsidiary or an affiliate thereof
within such period or purports to sell, transfer or assign Executive
Shares within such period, the Eligible Employee shall pay the
Corporation an amount equal to 10% of the Public Offering Price (as
liquidated damages, and not as a subscription price upon issuance of
the Shares) multiplied by the aggregate number of Executive Shares
purchased by such Eligible Employee or, in the case of a sale,
transfer or assignment of Executive Shares without the Eligible
Employee ceasing to be employed by the Corporation, a subsidiary or
an affiliate thereof, multiplied by the aggregate number of
Executive Shares so sold, transferred or assigned (the "Penalty"),
and the Trustee (as defined below) shall not deliver any such
Executive Shares to or to the order of the Eligible Employee until
the Corporation has received a certified cheque for such amount.
6.4 Participation in the Share Purchase Offer. In order to participate
in the Share Purchase Offer, Eligible Employees must have returned a
properly completed subscription form in the form set out as Exhibit
"A" hereto to the Secretary of the Corporation no later than 5:00
p.m. (Montreal Time) on June 14, 1994. If the Secretary of the
Corporation has not received the properly completed for-m by 5:00
(Montreal time) on June 14, 1994 in respect of any Eligible
Employee, such Eligible Employee shall not be entitled to
participate in the Share Purchase Offer. If, in respect of any
Eligible Employee, a properly completed form is received, such
Eligible Employee is entitled to purchase the number of Executive
Shares indicated in such subscription form, up to but not to exceed
such Eligible Employee's entitlement to participate in the Share
Purchase Offer calculated in accordance with Subsection 6.2, unless
he has withdrawn or revoked his application within two business days
after the receipt or deemed receipt of the final prospectus relating
to the IPO.
6.5 Payment. The properly completed subscription form shall be
accompanied by (i) a certified cheque made payable to the
Corporation in the amount of the aggregate purchase price for the
Executive Shares the Eligible Employee elected to purchase, or (ii)
in the event the Eligible Employee elects to obtain financial
assistance pursuant to Subsection 6.7, an indication on the
subscription form that the Eligible Employee so elects in the space
reserved for such purpose. The Corporation shall cause a certificate
for the number of Executive Shares specified in the subscription
form to be issued in the name of the Trustee and delivered to the
Trustee on behalf of the Eligible Employee not later than five
business days following the later of (iii) receipt of such notice
and, if applicable, the Eligible Employee's certified cheque, and
(iv) the closing of the IPO. The Secretary of the Corporation shall
act as escrow agent with respect to Executive Shares purchased by
such Eligible Employee in accordance with Subsection 6.6 (in such
capacity, referred to in this Section 6 as the "Trustee").
<PAGE>
6.6 Escrow. The Trustee shall hold the Executive Shares purchased by an
Eligible Employee pursuant to this Section 6 in escrow and such
Executive Shares shall not be transferred to the Eligible Employee
or to any other person until the later of (i) repayment in full of
any loan granted to or to the benefit of such Eligible Employee to
assist in the purchase of such Executive Shares pursuant to
Subsection 6.7 (the "Eligible Employee Loan"), and (ii) two years
after the date such Eligible Employee purchases the Executive Shares
in accordance with Subsection 6.5, (the "Retention Period").
Notwithstanding the foregoing, in the event an Eligible Employee
wishes to sell, transfer or otherwise alienate Executive Shares
prior to the expiry of the Retention Period and the Eligible
Employee has not ceased to be an employee of the Corporation, a
subsidiary or an affiliate thereof, the Trustee shall release such
number of Executive Shares from escrow as the Eligible Employee
wishes to sell, transfer or otherwise alienate prior to the expiry
of the Retention Period, provided that the Eligible Employee has
first repaid the proportion of the Eligible Employee Loan that such
Executive Shares are of all Executive Shares purchased by the
Eligible Employee and has paid any Penalty (as defined in Subsection
6.7) with respect to such Executive Shares. During the Retention
Period, all rights with respect to the Executive Shares held by the
Trustee on behalf of an Eligible Employee, including voting rights,
shall be exercisable by the Eligible Employee, and any dividends
payable on such Executive Shares shall be paid to the Eligible
Employee, subject any application of dividends to repayment of any
loan pursuant to Subsection 6.7. At the expiry of the Retention
Period, the Executive Shares shall be transferred by the Trustee to
the Eligible Employee and registered in the name of the Eligible
Employee.
6.7 Financial Assistance. An Eligible Employee may apply to the
Corporation for a loan in an amount necessary to permit the Eligible
Employee to purchase, from the Corporation, the Executive Shares
which the Eligible Employee has elected to purchase under the Share
Purchase Offer. To apply for a loan, the Eligible Employee must, at
the time of delivery of his subscription form to the Secretary of
the Corporation, have so indicated on the subscription form in the
space reserved for such purpose. The whole or any part of the loan
may be granted by the Corporation, in its discretion, subject to
applicable laws and such terms and conditions as the Board may, in
its sole discretion, stipulate, or arranged by the Corporation to be
made by a third party acceptable to the Corporation on such terms
and conditions as the Board may, in its sole discretion, agree. The
Corporation shall charge no interest or fees with respect to any
loan made by it hereunder and, if a loan is arranged by the
Corporation with a third party, shall bear all interest charges and
fees with respect thereto. The entire amount of any loan granted to
an Eligible Employee pursuant to the provisions of this Subsection
6.7 shall be used solely for the purchase of Executive Shares from
<PAGE>
the Corporation under the Share Purchase Offer in accordance with
the Plan. Any outstanding principal amount of such loan shall be
repayable by the Eligible Employee, and the Corporation may, in its
sole discretion, effect such payment from any proceeds of any sale,
transfer or other alienation by the Eligible Employee of Executive
Shares held by the Trustee, any dividends declared and paid on such
Executive Shares, any moneys payable to the Eligible Employee with
respect to RSUs pursuant to Subsection 7.3 and 25 % of any bonus
granted to the Eligible Employee under the Corporation's Short-Term
Incentive Plan. The Eligible Employee shall be deemed to have agreed
that the Corporation shall have, and shall have been deemed to have
granted, by his application for any such loan, a first-ranking
charge, hypothec and security interest over the Executive Shares
held by the Trustee to the account of the Eligible Employee as well
as over the proceeds of any such sale, transfer or alienation, such
dividends, such moneys and such other amounts.
6.8 Termination of Employment. When an Eligible Employee ceases to be an
employee of the Corporation, a subsidiary or an affiliate thereof,
whether before or after the expiry of the Retention Period, the
Eligible Employee, or the Eligible Employee's estate in the case of
death, shall have the right to receive from the Trustee the
Executive Shares purchased by him under the Share Purchase Offer and
held by the Trustee, subject to the prior repayment by or on behalf
of the Eligible Employee or the Eligible Employee's estate, as the
case may be, in full of the outstanding balance on any loan given to
the Eligible Employee pursuant to Subsection 6.7 and, if applicable,
any Penalty, in the event of termination for cause or resignation,
within thirty (30) days of the Eligible Employee ceasing employment,
and in any other case, within six (6) months following the date on
which the Eligible Employee ceased such employment. If the full
amount of the outstanding balance of such loan and any Penalty has
not been repaid within such period, the Corporation shall be
authorized to sell such Eligible Employee's Executive Shares and to
apply the net proceeds of such sale to the repayment of the loan and
any Penalty.
7. RESTRICTED SHARE UNITS
7.1 Rights to Restricted Share Units. Effective on the date an Eligible
Employee purchases Executive Shares pursuant to the Share Purchase
Offer, such Eligible Employee shall receive one RSU for every two
Executive Shares purchased by such Eligible Employee under the Share
Purchase Offer. The securities which may be issued pursuant to RSUs
are Shares. Subject to Section 10, the maximum number of Shares that
may be issued pursuant to RSUs shall not exceed 52,01 1.
<PAGE>
7.2 Forfeiture of RSUs. If an Eligible Employee sells, transfers or
otherwise alienates Executive Shares prior to the expiry of a
three-year period following the issuance of such Executive Shares
(the "Qualifying Period"), one RSU shall be immediately forfeited by
the Eligible Employee for every two such Executive Shares which are
so sold, transferred or otherwise alienated. If an Eligible Employee
ceases, at any time prior to the expiry of the Qualifying Period, to
be continuously employed by the Corporation, a subsidiary or an
affiliate thereof, for any reason whatsoever, the Eligible Employee
shall immediately forfeit all the RSUs held by such Eligible
Employee. The Secretary of the Corporation shall be entitled, acting
in his sole discretion, to require satisfactory evidence from the
Eligible Employee that the Eligible Employee has maintained
ownership of the applicable Executive Shares prior to authorizing
the payment of any cash pursuant to Subsection 7.3 or the issuance
of any Shares pursuant to Subsection 7.4.
7.3 Cash Payments on RSUs. Each holder of an RSU shall be entitled to
receive from the Corporation cash payments equal to any cash
dividends declared and paid to the holder of a Share, other than
dividends declared and paid not in the ordinary course of business,
during the period the Eligible Employee held such RSU; such amounts
shall be payable contemporaneously with the payment of such cash
dividends on the Shares. The right of a holder of RSUs to receive
such cash payment shall be subordinated in all respects to the
fights of the holders of Shares to receive dividends as and when
legally declared and paid.
7.4 Entitlement to Shares. Each RSU held by an Eligible Employee on the
third anniversary of the date the Eligible Employee purchased
Executive Shares shall immediately entitle the holder thereof to
receive, and the Corporation shall be obliged to issue, one Share of
the Corporation without payment of any further consideration by the
Eligible Employee.
8. QUANTITATIVE RESTRICTION
Notwithstanding anything to the contrary herein provided: (i) the total
number of Shares reserved for issuance pursuant to Options under the Plan
and under all employee options shall not exceed 10% of the issued Shares;
(ii) the maximum number of Shares that may be reserved for issuance to any
one person pursuant to the exercise of Options granted hereunder or
options under any other plans shall not exceed 5 % of Shares issued and
outstanding at the time of the grant; and (iii) the number of Shares which
may be issued under the Plan and other share compensation plans of the
Corporation in a one-year period shall not exceed (a) to insiders of the
Corporation, in the aggregate, 10% of the issued Shares, or (b) to any one
insider and such insider's associates, 5 % of the issued Shares.
<PAGE>
9. DURATION, AMENDMENT OR TERMINATION OF PLAN
Subject to Section 11, the Board may amend or terminate the Plan at any
time but in any such event, the rights of Eligible Employees related to
any granted but unexercised Options, Executive Shares purchased under the
Share Purchase Offer and RSUs shall be fully preserved and maintained. The
Board may amend the text of the Plan to correct or rectify any
ambiguities, defective provisions, errors or omissions herein, provided
that, in the opinion of the legal counsel, the rights of the Eligible
Employees and the shareholders of the Corporation are in no way prejudiced
thereby.
10. SUBDIVISION, CONSOLIDATION, CONVERSION OR RECLASSIFICATION
In the event that the Shares are subdivided, consolidated, converted or
reclassified by the Corporation, or that any other action of a similar
nature affecting such Shares is taken by the Corporation, the Shares and
RSUs issued or issuable under this Plan shall be appropriately increased
or decreased, converted or reclassified, and the total number of Shares
reserved for issuance under this Plan shall be adjusted in the same
manner. Such adjustment shall be made by the Committee, in its sole
discretion and subject to the requirements of applicable regulatory
authorities, and any determination by the Committee with respect to such
adjustment shall be conclusive and binding for all purposes of the Plan.
11. NECESSARY APPROVALS
Any grant of Options by the Corporation and the Corporation's obligation
to issue and deliver any Shares in accordance with this Plan, as well as
any amendment thereto, is subject to any required approval of regulatory
authorities having jurisdiction over the Shares ('including any stock
exchanges on which the Shares are listed).
12. RIGHTS NON-ASSIGNABLE
The rights of an Eligible Employee pursuant to the provisions of this Plan
are nonassignable, including by way of collateral or security for any
obligation of the Eligible Employee, other than in favour of the
Corporation as expressly provided herein.
13. GOVERNING LAW
The provisions of the Plan shall be interpreted in accordance with the
laws of the Province of Quebec.
14. MISCELLANEOUS
14.1 The participation of an individual in the Plan is at the sole
discretion of the Committee, and the provisions of the Plan, any
past practices of the Committee or the Board and any rules,
regulations or decisions related to the Plan by the Committee or the
Board shall not be interpreted as conferring upon any such
individual any rights or privileges other than those rights and
privileges expressly provided hereby and expressly granted by the
Committee.
14.2 The Plan does not provide any guarantee against any loss or profit
which may result from fluctuations in the market price of the
Shares.
<PAGE>
RESOLUTION OF THE HUMAN RESOURCES, MANAGEMENT DEVELOPMENT
AND COMPENSATION COMMITTEE
The percentage of annual base salary for the purposes of grants of
On-Going Options under Subsection 5.2 of the Company's Long-Term Incentive
Plan shall be the following percentages for the following offices:
Optionee Percentage of Base Salary
President and CEO 200%
VP, Finance and CFO 100%
VP, Marketing 100%
VP, Sales 100%
VP, Administration and Secretary 100%
VP, La Tuque Operations 100%
VP, Container Operations 100%
VP, Matane Operations 100%
VP, Montreal Operations 100%
Controller 100%
Manager, Engineering and 50%
Technology
Manager, Human Resources 50%
Manager, Operations Planning 50%
Manager, Woodlands 50%
<PAGE>
ST. LAURENT PAPERBOARD, INC.
EXECUTIVE OFFERING
SUBSCRIPTION FORM
PLEASE PRINT
Personal Information
Given Name(s) Family Name Social Ins. No.
Home Address Apt. # Employee No.
City Postal Code Telephone
APPLICATION DEADLINE: 5:00 p.m., June 14, 1994
Share Purchase
I apply to purchase $________ worth of Executive Shares at a price of $12.15
per share subject to the terms and conditions of the Share Purchase Offer set
out in the St. Laurent Paperboard Inc. Long-Term Incentive Plan and the Final
Prospectus.
I understand that if I cease to be an employee of St. Laurent Paperboard Inc.
("St. Laurent"), subsidiaries or affiliates thereof within a period of two years
from the date I have purchased the Executive Shares, or if I have sold,
transferred or otherwise alienated the Executive Shares within such period, I
shall be required to pay to St. Laurent, as liquidated damages, an amount equal
to $1.35 per Executive Share multiplied by the aggregated number of Executive
Shares purchased by me or, in the case of a sale, transfer or assignment of the
Executive Shares without my ceasing to be employed by St. Laurent, a subsidiary
or affiliate thereof, multiplied by the aggregate number of Executive Shares so
sold, transferred or assigned. I also understand that one Restricted Share Unit
will be forfeited by me for every two Executive Shares sold, transferred or
otherwise alienated by me prior to the expiry of a three-year period following
the issuance of such Executive Shares, and that all Restricted Share Units held
by me shall be immediately forfeited if, at any time during such three-year
period, I cease to be an employee of St. Laurent, a subsidiary or affiliate
thereof for any reason whatsoever.
I understand that the Executive Shares will be registered in the name of the
Trustee (as defined in the Plan) during the period of two years from the date of
purchase of the Executive Shares.
Reference is made to the St. Laurent Long-Term Incentive Plan for a full
description of the terms and conditions of the issuance of the Executive Shares.
If there is any inconsistency between the St. Laurent Long-Term Incentive Plan
and this Subscription Form, the terms and conditions of the St. Laurent
Long-Term Incentive Plan shall prevail.
<PAGE>
Payment (Please check (X) one box only)
__ I attach a certified cheque or money order payable in Canadian dollars to
St. Laurent in the amount of $ ________ as payment in full for the
Executive Shares I have applied for.
OR
__ I request St. Laurent to tend me, without interest, or to arrange on my
behalf a loan from a third person, an amount of $ to purchase the Executive
Shares I have applied for. If this loan is from a third party, I acknowledge
that St. Laurent will bear all interest and fees with respect to such loan. I
declare that I am indebted to St. Laurent or the third party, as the case may
be, and agree to execute a demand Promissory Note in favour of St. Laurent or
the third party, as the case may be, for the said amount. I authorize St.
Laurent to deduct this amount from (i) proceeds of any sale, transfer or
other alienation of my Executive Shares, (ii) any dividends declared and paid
on such Executive Shares, (iii) any moneys payable to me with respect to
Restricted Share Units, and (iv) 25% of any bonus granted to me under the St.
Laurent Short-Term Incentive Plan. I agree that St. Laurent will have a
first-ranking charge, hypothec and security interest over the Executive
Shares held by the Trustee to my account as well as over the proceeds of any
such sale, transfer or alienation, such dividends, such moneys and such other
amounts.
Prospectus and Purchasers Rights
I declare that:
a) I have received a copy of the St. Laurent Prospectus dated June 3, 1993
relating to the proposed offering of units, of 222,222 La Tuque Employee
Shares (as defined in the Prospectus) and of up to 104,022 Executive Shares;
b) I understand that this application does not constitute a binding
commitment to purchase nor does it commit St. Laurent to allot or issue
such number of shares until the St. Laurent Prospectus is sent to me and
my application is accepted by St. Laurent;
c) I understand that I have certain rights of withdrawal and rescission or
damages as described in the Prospectus under the heading "Purchasers'
Statutory Rights".
Declaration
I declare that all of the above information is accurate and that I am eligible
to apply under the Executive Offering (as defined in the Prospectus).
Signature Date
EXHIBIT 4.4
ST. LAURENT PAPERBOARD INC.
DIRECTORS STOCK OPTION AND
SHARE PURCHASE PLAN
1. PURPOSES OF THE PLAN
The purposes of this St. Laurent Paperboard Inc. Directors Stock Option
and Share Purchase Plan (the "Plan") are to:
1.1 attract and retain top calibre directors with a North American
dimension;
1.2 promote a proprietary interest in St. Laurent Paperboard Inc.
(the "Corporation") among its directors; and
1.3 allow directors of the Corporation (the "Directors") to put a
portion of their annual fees at risk by having them paid by way of
common shares of the Corporation (the "Shares") and options to
purchase Shares.
2. ADMINISTRATION
The Plan shall be administered by the members of the Human Resources,
Management Development and Compensation Committee of the Board of
Directors of the Corporation (respectively, the "Committee" and the
"Board") and is subject to the general authority of the Board. The
Committee and the Board shall have full and complete authority to
interpret the Plan and to prescribe such rules and regulations and make
such other determinations as they deem necessary or desirable for the
administration of the Plan. The Committee shall have full discretion to
suspend or refuse participation in the Plan by a Director. All decisions
and determinations of the Committee and the Board respecting the Plan
shall be binding and conclusive on the Plan and its participants.
3. ELIGIBILITY AND PARTICIPATION
Subject to Section 11 hereof, the Plan is offered to all elected Directors
who are not employees of the Corporation, beginning on the date hereof.
4. COMPONENTS OF THE PLAN
The Plan shall be composed of two components: (i) one-time options (the
"One-Time Options"), described in Section 6 hereof; and (ii) rights (the
"Rights"), described in Section 7 hereof.
<PAGE>
5. Description and Number of Securities Offered
The securities which may be purchased pursuant to One-Time Options and
Rights granted hereunder are Shares. Subject to Section 8 hereof, the
maximum number of Shares that may be issued pursuant to the exercise of
Options and the granting of Rights under this Plan shall not exceed
175,000.
6. ONE-TIME OPTIONS
6.1 Grant of One-Time Options. On the sixth (6th) business day
following the election of a Director for the first time by the
Shareholders of the Corporation or his/her appointment by the Board
of Directors, One-Time Options are hereby granted for the lesser of
(i) 7,500 Shares and (ii) such number of Shares obtained (rounded
down to the nearest whole number of Shares) by dividing $150,000 by
the weighted average trading price per Share on the Montreal
Exchange and The Toronto Stock Exchange during the period of five
consecutive trading days ending on the trading day immediately prior
to the day on which the One-Time Option is granted. It is understood
that a Director may refuse such grant for any reason whatsoever upon
written notice to the Vice-President, Administration and Secretary
of the Corporation.
6.2 Exercise Price. The exercise price for each Share covered by a
One-Time Option shall be the weighted average price per Share at
which the Shares are traded on the Montreal Exchange and The Toronto
Stock Exchange during the period of five consecutive trading days
ending on the trading day immediately prior to the day on which the
One-Time Option is granted; for such purposes, the "weighted average
price" shall be determined by dividing the aggregate sale prices of
all the Shares sold on such exchanges during the said five day
period by the total number of Shares sold, as reported by the said
exchanges.
6.3 One-Time Option Period. Unless the Committee, in its sole
discretion, decides otherwise, the total number of One-Time Options
granted shall become exercisable one year after the date of the
grant thereof. No One-Time Option, however, may be exercised after
the tenth anniversary of the grant thereof. A Director may on any
date exercise part only or all of any One-Time Option at any time
during any period that it continues to be exercisable, without
prejudice to his right to exercise the balance, if any, of the
One-Time Option at subsequent times during the period the One-Time
Option continues to be exercisable.
<PAGE>
6.4 Exercise, Payment and Issue of Shares. Exercise of any One-Time
Option shall be made by written notice to the Secretary of the
Corporation setting forth the number of Shares with respect to which
the One-Time Option is being exercised and specifying the address to
which the certificate evidencing such Shares is to be delivered.
Such notice shall be accompanied by a certified cheque made payable
to the Corporation in the amount of the exercise price. The
Corporation shall cause a certificate for the number of Shares
specified in the notice to be issued in the name of the Director and
delivered to the address specified in the notice not later than five
business days following receipt of such notice and cheque.
6.5 Termination of Mandate. When a Director ceases to be a director
of the Corporation, whether further to retirement, death,
resignation or for any other reason, the Director, or the Director's
estate in the case of death, shall have the right to exercise all
One-Time Options granted to the Director which could be exercised on
the date he ceased to be a director at any time within a period of
twelve months after the Director ceased to be a director, provided
that such exercise shall be prior to the expiry of the maximum
period established for the exercise of such One-Time Option.
7. RIGHTS
7.1 Grant of Rights. Each Director shall receive 50% of the sum of his
annual retainer as a Director and additional retainers for committee
membership for the ensuing year until the next annual meeting of
shareholders in Rights, each Right to consist of one Share and a
10-year option to subscribe for one Share. Each Director may also
complete an election form (substantially as set forth in Schedule A
hereto) and remit it to the Secretary of the Corporation within two
weeks of his election or reelection by the shareholders of the
Corporation. A Director can therefore elect to receive the remaining
50% of the sum of his annual retainer as a Director and additional
retainers for committee membership for the ensuing year until the
next annual meeting of shareholders in Rights.
7.2 Number of Rights. The number of Rights granted shall be equal to the
amount of fees divided by the Market Price (as defined in Subsection
7.4 hereof) of the Shares at the time of the election. The total
elected amount will be paid in Rights and any fractional Share
amounts will be paid in cash.
<PAGE>
7.3 Options. Reference is made to Subsections 6.2, 6.3, 6.4, and 6.5
hereof with respect to the exercise price, option period, exercise,
payment and issue of Shares and termination of mandate, which
provisions apply mutatis mutandis to the options forming part of the
Rights, except as otherwise provided in Subsection 7.6 hereof.
7.4 Issue of Shares. Upon receiving the election form of a Director, the
Corporation shall remit the elected amount to Montreal Trust Company
(the "Trustee") who shall use such amount to purchase, for and on
behalf of the Director, from the Treasury of the Corporation a
number of Shares equal to the quotient obtained by dividing such
amount by the Market Price of the Shares. For the purposes hereof,
the Market Price shall be the weighted average price (as defined in
Subsection 6.2 hereof) per Share at which the Shares are traded on
The Montreal Exchange and The Toronto Stock Exchange during the
period of five consecutive trading days ending on the trading day
immediately prior to the date of issue of the Shares. With respect
to election forms completed in 1995, the purchase of Shares by the
Trustee will take place following the approval of the shareholders
of the Plan at the next annual meeting, as provided in Section 11
hereof.
7.5 Escrow of Shares. Except for Shares purchased pursuant to election
forms completed in 1995, all Shares purchased by the Trustee for and
on behalf of a Director will be registered in the name of and held
by the Trustee for a period of one year following the date of
purchase of such Shares by the Trustee. At the end of the one year
period, the Shares will be registered in the name of the Director
and the Trustee will remit to the Director a share certificate
representing the number of Shares held by the Trustee for and on
behalf of the Director.
All rights related to the Shares held by the Trustee in the name of
a Director, including voting rights, shall be exercised by the
Director through the Trustee who shall cause to be executed and
delivered suitable proxies and voting powers to permit Directors to
vote. All dividends payable to holders of such Shares shall be paid
to the Trustee who shall hold such amounts during the one-year
period.
<PAGE>
7.6 Termination of Mandate. When a Director ceases to be a director of
the Corporation, whether further to retirement, death, resignation
or for any other reason, the Director, or the Director's estate in
the case of death, shall (i) receive a number of Shares based on the
amount of fees earned so far during the year and (ii) retain for a
period of twelve months after the Director ceased to be a director
such number of options associated with the last grant of Rights
prorated on the basis of the amount of fees earned so far during the
year, and the balance of the Shares and options associated with the
latest grant of Rights only shall be forfeited.
8. QUANTITATIVE RESTRICTION
Notwithstanding anything to the contrary herein provided, the number of
Shares which may be issued under the Plan and other share compensation
plans of the Corporation in a one-year period shall not exceed (a) 10% of
the issued Shares, or (b) to any one insider and such insider's
associates, 5% of the issued Shares.
9. DURATION, AMENDMENT OR TERMINATION OF PLAN
Subject to the approval of regulatory authorities, the Board may amend or
terminate the Plan at any time but in any such event, the rights of
Directors related to any One-Time Options and Rights granted hereunder
shall be fully preserved and maintained. The Board may amend the text of
the Plan to correct or rectify any ambiguities, defective provisions,
errors or omissions herein, provided that, in the opinion of the legal
counsel of the Corporation, the rights of the Directors and the
shareholders of the Corporation are in no way prejudiced thereby.
10. SUBDIVISION, CONSOLIDATION, CONVERSION OR RECLASSIFICATION
In the event that the Shares are subdivided, consolidated, converted or
reclassified by the Corporation, or that any other action of a similar
nature affecting such Shares is taken by the Corporation, the Shares
issued or issuable under this Plan shall be appropriately increased or
decreased, converted or reclassified, and the total number of Shares
reserved for issuance under this Plan shall be adjusted in the same
manner. Such adjustment shall be made by the Committee, in its sole
discretion and subject to the requirements of applicable regulatory
authorities, and any determination by the Committee with respect to such
adjustment shall be conclusive and binding for all purposes of the Plan.
11. NECESSARY APPROVALS
The Plan shall be subject to any required approval of regulatory
authorities, including the Montreal and Toronto stock exchanges. The Plan
shall also be subject to the approval of the shareholders of the
Corporation at the next annual meeting of shareholders. Any option granted
prior to such approvals shall be conditional upon such approvals and no
such options may be exercised and no Shares may be issued pursuant to
Rights granted hereunder unless such approvals are obtained.
<PAGE>
12. TRUSTEE
12.1 The Corporation may, at any time and from time to time, terminate
the obligations of the Trustee pursuant hereto and, in its stead and
place, appoint another Trustee.
12.2 The Trustee shall not be held liable for any act or omission in the
performance of its duties pursuant to the provisions of the Plan or
for any act or omission of any person to whom it shall have
delegated such obligation, except for any act or omission resulting
from its own wilful misconduct, fault or negligence.
13. RIGHTS NON-ASSIGNABLE
The rights of a Director pursuant to the provisions of this Plan are
non-assignable, in whole or in part, directly or indirectly.
14. GOVERNING LAW
The provisions of the Plan shall be interpreted in accordance with the
laws of the Province of Quebec.
15. MISCELLANEOUS
15.1 The participation of an individual in the Plan is at the sole
discretion of the Committee, and the provisions of the Plan, any
past practices of the Committee or the Board and any rules,
regulations or decisions related to the Plan by the Committee or the
Board shall not be interpreted as conferring upon any such
individual any rights or privileges other than those rights and
privileges expressly provided hereby and expressly granted by the
Committee.
15.2 The Plan does not provide any guarantee against any loss or profit
which may result from fluctuations in the market price of the
Shares.
Dated, September 9, 1997
<PAGE>
SCHEDULE A
ELECTION FORM
ST. LAURENT PAPERBOARD INC.
DIRECTORS STOCK OPTION AND SHARE PURCHASE PLAN
I hereby elect that an additional 50% of my annual retainer, as a director
of the Corporation and as a committee member, be paid in the form of Rights,
each Right consisting of one common share of the Corporation and a ten-year
option to subscribe to one common share, the whole as provided in the
Corporation's Directors Stock Option and Share Purchase Plan which I confirm I
have read.
Dated this day of 199 .
Signature
Name
Address
EXHIBIT 4.5
[FACE OF CERTIFICATE]
St. Laurent Paperboard Inc.
[Incorporated under the Canada Business Corporations Act]
Shares:_________ Number:_____
CUSIP: 790907 10 9
This certifies that _______________________________ is the registered holder of
_______________ common shares of St. Laurent Paperboard Inc.
A transfer of the shares represented by this certificate will be registered in a
securities register of the Corporation upon surrender of this certificate duly
endorsed by the appropriate person. This certificate is not valid until
countersigned and registered by the Transfer Agent and Registrar of the
Corporation.
In Witness Whereof the Corporation has caused this certificate to be signed by
its duly authorized officers.
- ---------------------- ----------------------
Vice President, Administration President and Chief Executive Officer
and Secretary
These shares are transferable at the principal offices of
Montreal Trust Company in Vancouver, Calgary, Toronto, Montreal and Halifax
[REVERSE OF CERTIFICATE]
The class of shares that this certificate represents has rights, privileges,
restrictions and conditions attached thereto and the Corporation will furnish to
a shareholder on demand and without charge a full copy of the text of the
rights, priveleges, restrictions and conditions attached to each class
authorized to be issued and to each series that has been fixed by the directors
as well as the authority of the directors to fix the rights, privelges,
restrictions and conditions of subsequent series.
For value received, the undersigned assigns and transfers unto
- ------------------------------------------
(Please insert social unsurance number or other identifying number of assignee)
- ------------------------------------------------------------------------------
(Please print name and address)
___________________________ Common Shares
(Number of shares)
of the Corporation represented by the within certificate and does hereby
irrevocably constitute and appoint ________________________ Attorney to enter
the transfer of the said shares in the securities register of the Corporation,
with full power of substitution in the premises.
Date:
In the presence of:
Signature of Transferor:
<PAGE>
Until the Separation Time (as defined in the Rights Agreement referred to
below), this certificate also evidences and entitles the holder hereof to
certain rights as set forth in a Shareholder Rights Plan Agreement, dated as of
the 1st day of February, 1995 and amended and restated as of April 28, 1995,
March 5, 1998 and May 7, 1998 (the "Rights Agreement"), between St. Laurent
Paperboard Inc. (the "Corporation") and Montreal Trust Company, as Rights Agent,
the terms of which are hereby incorporated herein by reference and a copy of
which may be inspected during normal business hours at the principal executive
offices of the corporation. Under certain circumstances as set forth in the
Rights Agreement, such rights may be amended, terminated, may expire, may become
void (if, in certain cases, they are "Beneficially Owned" by an "Acquiring
Person," as such terms are defined in the Rights Agreeemnt, whether currently
held by or on behalf of such person or any subsequent holder) or may be
evidenced by separate certificates and may no longer be evidenced by this
certificate. The Corporation will mail or arrange for the mailing of a copy of
the Rights Agreement for the holder of this certificate without charge as soon
as it is practicable after the receipt of a written request therefor.
EXHIBIT 4.6
------------------------------------------------------------
SHAREHOLDER RIGHTS PLAN AGREEMENT
DATED AS OF FEBRUARY 1, 1995
AND AMENDED AND RESTATED AS OF
May 7, 1998
between
ST. LAURENT PAPERBOARD INC.
and
MONTREAL TRUST COMPANY,
as Rights Agent
------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
TABLE OF CONTENTS..........................................................i
ARTICLE 1 INTERPRETATION..................................................2
1.1 Certain Definitions............................................2
1.2 Currency.......................................................10
1.3 Descriptive Headings...........................................10
1.4 References to Agreement........................................10
1.5 Calculation of Number and Percentage of Beneficial Ownership of
Outstanding Voting Shares .....................................11
1.6 Acting Jointly or in Concert...................................11
ARTICLE 2 THE RIGHTS......................................................11
2.1 Legend on Certificates.........................................11
2.2 Execution, Authentication, Delivery and Dating of Rights
Certificates...................................................12
2.3 Registration, Registration of Transfer and Exchange............12
2.4 Mutilated, Destroyed, Lost and Stolen Rights Certificates......13
2.5 Persons Deemed Owners of Rights................................13
2.6 Delivery and Cancellation of Certificates......................13
2.7 Agreement of Rights Holders....................................13
2.8 Rights Certificate Holder Not Deemed a Shareholder.............14
ARTICLE 3 EXERCISE OF THE RIGHTS..........................................14
3.1 Initial Exercise Price; Exercise of Rights;
Detachment of Rights ..........................................14
3.2 Adjustments to Exercise Price; Number of Rights................17
3.3 Date on Which Exercise is Effective............................21
ARTICLE 4 ADJUSTMENTS TO THE RIGHTS UPON A FLIP-IN EVENT..................22
ARTICLE 5 THE RIGHTS AGENT................................................23
5.1 General........................................................23
5.2 Merger or Amalgamation or Change of Name of Rights Agent.......23
5.3 Duties of Rights Agent.........................................23
5.4 Change of Rights Agent.........................................25
ARTICLE 6 MISCELLANEOUS...................................................25
6.1 Redemption and Waiver..........................................25
6.2 Expiration.....................................................27
6.3 Issuance of New Rights Certificate.............................27
6.4 Fractional Rights and Fractional Shares........................27
6.5 Supplements and Amendments.....................................27
6.6 Rights of Action...............................................28
6.7 Notice of Proposed Actions.....................................28
6.8 Notices........................................................29
6.9 Costs of Enforcement...........................................29
6.10 Successors.....................................................30
6.11 Benefits of this Agreement.....................................30
6.12 Governing Law..................................................30
6.13 Counterparts...................................................30
6.14 Severability...................................................30
6.15 Effective Date.................................................30
6.16 Reconfirmation and Approval: Reconfirmation...................30
6.17 Actions by the Board of Directors..............................31
6.18 Time of the Essence............................................31
6.19 Regulatory Approvals...........................................31
6.20 Language.......................................................31
EXHIBIT A [FORM OF RIGHTS CERTIFICATE].....................................32
RIGHTS CERTIFICATE.........................................................32
FORM OF ELECTION TO EXERCISE AND CERTIFICATE...............................34
FORM OF ASSIGNMENT AND CERTIFICATE.........................................36
NOTICE
<PAGE>
MEMORANDUM OF AGREEMENT made as of the 1st day of February, 1995,
and amended and restated as of April 28, 1995, as of March 5, 1998 and as of May
7, 1998
B E T W E E N:
ST. LAURENT PAPERBOARD INC., a corporation
incorporated under the laws of Canada,
(hereinafter called the "Corporation"),
OF THE FIRST PART,
- and -
MONTREAL TRUST COMPANY, a trust company incorporated
under the laws of Canada as rights agent,
(hereinafter called the "Rights Agent"),
OF THE SECOND PART.
WHEREAS in order to maximize shareholder value the Board of
Directors of the Corporation has determined that it is advisable for the
Corporation to adopt a shareholder rights plan (the "Rights Plan");
AND WHEREAS in order to implement the Rights Plan the Board of
Directors of the Corporation has:
1. authorized the issuance, effective 5:00 p.m. (Montreal time) on February 1,
1995, of one right (a "Right") in respect of each Common Share (as hereinafter
defined) of the Corporation outstanding at 5:00 p.m. (Montreal time) on February
1, 1995 (the "Record Time");
2. authorized the issuance of one Right in respect of each Common Share issued
after the Record Time and prior to the earlier of the Separation Time (as
hereinafter defined) and the Expiration Time (as hereinafter defined); and
3. with respect to the Debentures (as hereinafter defined), authorized the
issuance of one Right in respect of each Common Share issued upon the conversion
of Debentures after the Separation Time and prior to the occurrence of a Flip-in
Event;
AND WHEREAS each Right entitles the holder thereof, after the
Separation Time, to purchase securities of the Corporation (or, in certain
cases, of certain other entities) pursuant to the terms and subject to the
conditions set forth herein;
AND WHEREAS the Corporation desires to appoint the Rights Agent to
act on behalf of the Corporation and holders of Rights, and the Rights Agent is
willing so to act, in connection with the issuance, transfer, exchange and
replacement of Rights Certificates (as hereinafter defined), the exercise of
Rights and other matters referred to herein;
AND WHEREAS pursuant to section 6.5(a) of this Agreement the Board
of Directors acting in good faith by resolution on April 28, 1995 made certain
amendments to this Agreement and directed that this restatement of the Agreement
as so amended be executed and delivered for and on behalf of the Corporation
(the "Amended and Restated Agreement");
<PAGE>
AND WHEREAS in preparation for the reconfirmation of the Amended and
Restated Agreement at the 1998 annual meeting of the Corporation pursuant to
section 6.16 of the Amended and Restated Agreement, the Board of Directors of
the Corporation acting in good faith by resolutions on March 5, 1998 and May 7,
1998 made certain amendments, subject to the consent of the holders of Voting
Shares pursuant to section 6.5(b) of the Amended and Restated Agreement, and
directed that this restatement of the Amended and Restated Agreement as so
amended be executed and delivered for and on behalf of the Corporation (the
Amended and Restated Agreement, as so amended again, being herein called the
"Agreement");
NOW THEREFORE, in consideration of the premises and the respective
covenants and agreements set forth herein, the parties hereby agree as follows:
ARTICLE 1
INTERPRETATION
1.1 Certain Definitions
For the purposes of this Agreement, the following terms have the
meanings indicated:
(a) "Acquiring Person" shall mean any Person who is the Beneficial Owner
of 20% or more of the outstanding Voting Shares; provided, however,
that the term "Acquiring Person" shall not include:
(i) the Corporation or any Subsidiary of the Corporation;
(ii) any Person who becomes the Beneficial Owner of 20% or more of
the outstanding Voting Shares as a result of any one or any
combination of:
(A) an acquisition or redemption by the Corporation of
Voting Shares which, by reducing the number of
outstanding Voting Shares, increases the percentage of
outstanding Voting Shares Beneficially Owned by such
Person to 20% or more of the Voting Shares then
outstanding (a "Voting Share Reduction");
(B) an acquisition of Voting Shares made pursuant to a
Permitted Bid or a Competing Permitted Bid (a "Permitted
Bid Acquisition");
(C) an acquisition of Voting Shares in respect of which the
Board of Directors has waived the application of section
4 pursuant to the provisions of subsection 6.1 (b) or
(c) or which was made on or prior to the date of this
Agreement (an "Exempt Acquisition"); or
(D) a Pro Rata Acquisition;
provided, however, that if a Person shall become the
Beneficial Owner of 20% or more of the Voting Shares of
any class of the Corporation then outstanding by reason
of one or any combination of a Voting Share Reduction, a
Permitted Bid Acquisition, an Exempt Acquisition or a
Pro Rata Acquisition and, while such Person is the
Beneficial Owner of 20% or more of the Voting Shares
then outstanding, such Person's Beneficial Ownership of
Voting Shares thereafter increases by more than 1.0% of
the number of Voting Shares outstanding (other than
pursuant to one or any combination of a Voting Share
Reduction, a Permitted Bid Acquisition, an Exempt
Acquisition or a Pro Rata Acquisition) then, as of the
date such Person becomes the Beneficial Owner of such
additional Voting Shares, such Person shall be an
"Acquiring Person";
<PAGE>
(iii) for a period of 10 days after the Disqualification Date (as
hereinafter defined), any Person who becomes the Beneficial
Owner of 20% or more of the outstanding Voting Shares as a
result of such Person becoming disqualified from relying on
subsection 1.1(d)(v) hereof solely because such Person or the
Beneficial Owner of the Voting Shares is making or has
announced an intention to make a Take-over Bid, either alone
or by acting jointly or in concert with any other Person; for
the purposes of this definition, "Disqualification Date" means
the first date of public announcement that any Person is
making or has announced an intention to make a Take-over Bid;
(iv) an underwriter or member of a banking or selling group acting
in such capacity that becomes the Beneficial Owner of 20% or
more of the Voting Shares in connection with a distribution of
securities pursuant to a prospectus or by way of private
placement; and
(v) a Person (a "Grandfathered Person") who is the Beneficial
Owner of 20% or more of the outstanding Voting Shares
determined as of the Record Time, provided, however, that
this exemption shall not be, and shall cease to be,
applicable to a Grandfathered Person in the event that such
Grandfathered Person shall, after the Record Time, become
the Beneficial Owner of additional Voting Shares that
increases its Beneficial Ownership of Voting Shares by more
than 1% of the number of Voting Shares outstanding as at
the Record Time, other than through one or any combination
of a Voting Share Reduction, a Permitted Bid Acquisition,
an Exempt Acquisition or a Pro Rata Acquisition.
(b) "Affiliate", when used to indicate a relationship with a specified
Person, means a Person that directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under
common control with, such specified Person;
(c) "Associate" means, when used to indicate a relationship with a
specified Person, a spouse of that Person, any Person of the same or
opposite sex with whom that Person is living in a conjugal
relationship outside marriage, a child of that Person or a relative
of that Person if that relative has the same residence as that
Person;
(d) a Person shall be deemed the "Beneficial Owner" of, and to have
"Beneficial Ownership" of, and to "Beneficially Own":
(i) any securities as to which such Person, or any of such
Person's Affiliates or Associates is the owner at law or in
equity;
(ii) any securities as to which such Person or any of such
Person's Affiliates or Associates has the right to become
the owner at law or in equity (whether such right is
exercisable immediately or within a period of 60 days
thereafter and whether or not on condition or the happening
of any contingency) pursuant to any agreement, arrangement,
pledge or understanding, whether or not in writing (other
than (x) a customary agreement with and between
underwriters and banking group or selling group members
with respect to a distribution of securities of the
Corporation pursuant to a prospectus or by way of private
placement, and (y) a pledge of securities in the ordinary
course of business) or upon the exercise of any conversion
right, exchange right, share purchase right (other than a
Right), warrant or option; and
<PAGE>
(iii) any securities which are Beneficially Owned within the meaning
of the foregoing provisions of this subsection 1.1(d)(i) and
(ii) by any other Person with whom such person is acting
jointly or in concert;
provided, however, that a Person shall not be deemed the "Beneficial
Owner" of, or to have "Beneficial Ownership" of, or to "Beneficially
Own", any security:
(iv) where such security has been agreed to be deposited or
tendered pursuant to a Permitted Lock-Up Agreement or is
otherwise deposited or tendered pursuant to any Take-over
Bid made by such Person, made by any of such Person's
Affiliates or Associates or made by any other Person acting
jointly or in concert with such Person until such deposited
or tendered security has been taken up or paid for,
whichever shall occur first;
(v) where such Person, any of such Person's Affiliates or
Associates or any other Person acting jointly or in concert
with such Person holds over such security, provided that:
(A) the ordinary business of that Person (an "Investment
Manager") includes the management of investment funds
for others (which others, for greater certainty, may
include or be limited to one or more employee benefit
plans or pension plans) and such security is held by
the Investment Manager in the ordinary course of such
business in the performance of such Investment
Manager's duties for the account of any other Person
(a "Client"); or
(B) that Person (a "Trust Company") is licensed to carry
on the business of a trust company under applicable
laws and, as such, acts as trustee or administrator
or in a similar capacity in relation to the estates
of deceased or incompetent Persons ("Estate
Accounts") or in relation to other accounts ("Other
Accounts") and holds such security in the ordinary
course of such duties for the estate of any such
deceased or incompetent Person or for such other
account; or
(C) such Person is established by statute for purposes that
include, and the ordinary business or activity of such
Person (the "Statutory Body") includes, the management
of investment funds for employee benefit plans, pension
plans, insurance plans or various public bodies; or
(D) such Person (the "Administrator") is the administrator
or trustee of one or more pension funds or plans (a
"Plan") or is a Plan registered under the laws of Canada
or any Province thereof or the laws of the United States
of America or any State thereof; or
(E) such Person (a "Securities Depository") is a registered
holder of such security as a result of carrying on the
business of, or acting as a nominee of, a securities
depository,
provided, in any of the above cases, that the Investment
Manager, the Trust Company, the Statutory Body, the
Administrator, the Plan or the Securities Depository, as the
case may be, is not then making a Take-over Bid or has not
then announced an intention to make a Take-over Bid, other
than an Offer to Acquire Voting Shares or other securities by
means of a distribution by the Corporation or by means of
ordinary market transactions (including prearranged trades)
executed through the facilities of a stock exchange or
organized over-the-counter market, alone or by acting jointly
or in concert with any other Person;
<PAGE>
(vi) where such Person is (A) a Client of the same Investment
Manager as another Person on whose account the Investment
Manager holds such security, (B) an Estate Account or an Other
Account of the same Trust Company as another Person on whose
account the Trust Company holds such security or (C) a Plan
with the same Administrator as another Plan on whose account
the Administrator holds such security; or
(vii) where such Person is (A) a Client of an Investment Manager and
such security is owned at law or in equity by the Investment
Manager, (B) an Estate Account or an Other Account of a Trust
Company and such security is owned at law or in equity by the
Trust Company or (C) a Plan and such security is owned at law
or in equity by the Administrator of the Plan;
(e) "Board of Directors" shall mean the board of directors of the
Corporation or, if duly constituted and whenever duly empowered, the
executive committee of the board of directors of the Corporation;
(f) "Business Day" shall mean any day other than a Saturday, a Sunday or
a day on which banking institutions in Toronto or Montreal are
authorized or obligated by law to close;
(g) "Canada Business Corporations Act" shall mean the Canada Business
Corporations Act, R.S.C. 1985, c. C-44, as amended, and the
regulations made thereunder, and any comparable or successor laws or
regulations thereto;
(h) "close of business" on any given date shall mean the time on such
date (or, if such date is not a Business Day, the time on the next
succeeding Business Day) at which the offices of the transfer agent
for the Common Shares (or, after the Separation Time, the offices of
the Rights Agent) are closed to the public in the city in which such
transfer agent or Rights Agent has an office for the purposes of
this Agreement;
(i) "Common Share" shall mean a common share of the Corporation and any
other share of the Corporation into which such share may be
subdivided, consolidated, reclassified or changed;
(j) "common shares", when used with reference to any Person other than
the Corporation, shall mean the class or classes of shares (or
similar equity interest) with the greatest per share (or similar
interest) voting power entitled to vote generally in the election of
all directors of such other Person;
(k) "Competing Permitted Bid" means a Take-over Bid made while
another Permitted Bid is in existence and that satisfies all of
the provisions of a Permitted Bid except that the condition set
forth in clause (ii) of the definition of a Permitted Bid may
provide that the Voting Shares that are the subject of the
Take-over Bid may be taken up or paid for on a date which is not
earlier than the later of (i) the earliest date that Voting
Shares may be taken up under the Take-over Bid in accordance with
the statutory requirements of the Securities Act (Ontario), as
amended from time to time, and (ii) the 60th day after the
earliest date on which any other Permitted Bid or Competing
Permitted Bid that is then in existence was made;
(l) "controlled": a corporation is "controlled" by another Person if:
(i) securities entitled to vote in the election of directors
carrying more than 50 per cent of the votes for the election
of directors are held, directly or indirectly, by or for the
benefit of the other Person; and
<PAGE>
(ii) the votes carried by such securities are entitled, if
exercised, to elect a majority of the board of directors of
such corporation;
and "controls", "controlling" and "under common control with"
shall be interpreted accordingly;
(m) "Co-Rights Agents" shall have the meaning ascribed thereto in
subsection 5.1(a);
(n) "Disposition Date" shall have the meaning ascribed thereto in clause
6.1(c)(ii);
(o) "Debentures" means the 8% Convertible Unsecured Subordinated
Debentures due 2004 of the Corporation;
(p) "dividends paid in the ordinary course" shall mean cash dividends
paid at regular intervals in any financial year of the Corporation
to the extent that such cash dividends do not exceed, in the
aggregate, the greatest of:
(i) 200% of the aggregate amount of cash dividends declared
payable by the Corporation on its Common Shares in its
immediately preceding financial year;
(ii) 300% of the arithmetic average of the aggregate amounts of
cash dividends declared payable by the Corporation on its
Common Shares in its three immediately preceding financial
years; and
(iii) 100% of the aggregate consolidated net income of the
Corporation, before extraordinary items, for its immediately
preceding financial year;
(q) "Dividend Reinvestment Plan" means a regular dividend reinvestment
or other plan of the Corporation made available by the Corporation
to holders of its securities where such plan permits the holder to
direct that some or all of:
(i) dividends paid in respect of shares of any class of the
Corporation;
(ii) proceeds of redemption of shares of the Corporation;
(iii) interest paid on evidences of indebtedness of the Corporation;
or
(iv) optional cash payments;
be applied to the purchase from the Corporation of Voting Shares;
(r) "Effective Date" means February 1, 1995;
(s) "Election to Exercise" shall have the meaning ascribed thereto in
clause 3.1(d)(ii);
(t) "Exempt Acquisition" shall have the meaning ascribed thereto in
subclause 1.1(a)(ii)(C);
(u) "Exercise Price" shall mean, as of any date, the price at which a
holder of a Right may purchase the securities issuable upon exercise
of such Right. Until adjustment thereof in accordance with the terms
hereof, the Exercise Price for each Right shall be $65;
(v) "Expiration Time" shall mean the close of business on that date
which is the earliest of the date of termination of this Agreement
pursuant to section 6.15 or, if this Agreement is confirmed pursuant
to section 6.15, the date of termination of this Agreement pursuant
to section 6.16 or, if this Agreement is reconfirmed pursuant to
section 6.16, the close of business on the tenth anniversary of the
Effective Date;
<PAGE>
(w) "Flip-in Event" shall mean a transaction in or pursuant to which any
Person shall become an Acquiring Person;
(x) "Grandfathered Person" shall have the meaning ascribed thereto in
clause 1.1(a)(v);
(y) "Independent Shareholders" shall mean holders of Voting Shares
other than Voting Shares Beneficially Owned by: (i) any
Acquiring Person; (ii) any Offeror (other than any Person who by
virtue subsection 1.1(d)(v) is not deemed to Beneficially Own the
Voting Shares held by such Person); (iii) any Associate or
Affiliate of any Acquiring Person or Offeror; (iv) any Person
acting jointly or in concert with persons referred to in (i) or
(ii) above; and (v) any employee benefit plan, share purchase
plan, deferred profit sharing plan and any other similar plan or
trust for the benefit of employees of the Corporation or a
Subsidiary of the Corporation, unless the beneficiaries of the
plan or trust direct the manner in which the Voting Shares are to
be voted or direct whether the Voting Shares are to be tendered
pursuant to a Take-over Bid;
(z) "Market Price" per share of any securities on any date of
determination shall mean the weighted average trading price per
share of such securities on the principal stock exchange in
Canada (as determined by the Board of Directors) on which such
securities are listed and posted for trading during the 20
consecutive Trading Day period ending no later than the fifth
Trading Day immediately preceding such date; provided, however,
that if an event of a type analogous to any of the events
described in section 3.2 shall have occurred during such period
such that the Market Price as established pursuant to the
foregoing shall not fully reflect the market price on such date
of determination, such Market Price shall be appropriately
adjusted in a manner analogous to the applicable adjustment
provided for in section 3.2 in order to make it fully comparable;
(aa) "Offer to Acquire" shall include:
(i) an offer to purchase, or a solicitation of an offer to sell
Voting Shares; and
(ii) an acceptance of an offer to sell Voting Shares, whether or
not such offer to sell has been solicited,
or any combination thereof, and the Person accepting an offer to
sell shall be deemed to be making an offer to acquire to the Person
who made the offer to sell;
(ab) "Offeror" shall mean a Person who has announced an intention to make
or who is making a Take-over Bid, but excluding that Person if the
Take-Over Bid so announced or made by that Person has been
withdrawn, has terminated or has expired;
(ac) "Permitted Bid" means a Take-over Bid which is made by means of a
Take-over Bid circular and which also complies with the following
additional provisions:
(i) the Take-over Bid is made to all holders of record of Voting
Shares as registered on the books of the Corporation, other
than the Offeror;
(ii) the Take-over Bid contains, and the take up and payment for
securities tendered or deposited thereunder is subject to,
an irrevocable and unqualified condition that no Voting
Shares shall be taken up or paid for pursuant to the
Take-over Bid prior to the close of business on the date
which is not less than 60 days after the date of the
Take-over Bid and only if at such date more than 50% of the
Voting Shares held by Independent Shareholders shall have
been deposited or tendered pursuant to the Take-over Bid
and not withdrawn;
<PAGE>
(iii) unless the Take-over Bid is withdrawn, the Take-over Bid
contains an irrevocable and unqualified provision that Voting
Shares may be deposited pursuant to such Take-over Bid at any
time during the period of time between the date of the
Take-over Bid and the date on which Voting Shares subject to
the Take-over Bid may be taken up and paid for (as referred to
in clause (ii) hereof) and that any Voting Shares deposited
pursuant to the Take-over Bid may be withdrawn until taken up
and paid for; and
(iv) the Take-over Bid contains an irrevocable and unqualified
provision that in the event that, on the date on which
Voting Shares subject to the Take-over Bid may be taken up
and paid for, more than 50% of the Voting Shares held by
Independent Shareholders shall have been deposited or
tendered pursuant to the Take-over Bid and not withdrawn,
the Offeror will make a public announcement of that fact
and the Take-over Bid will remain open for deposits and
tenders of Voting Shares for not less than 10 Business Days
from the date of such public announcement;
provided that if a Take-over Bid constitutes a Competing Permitted Bid,
the term "Permitted Bid" shall also mean the Competing Permitted Bid;
(ad) "Permitted Bid Acquisitions" shall have the meaning ascribed
thereto in subclause 1.1(a)(ii)(B);
(adx) "Permitted Lock-Up Agreement" means an agreement between a Person
and one or more holders of Voting Shares (the terms of which are
publicly disclosed and reduced to writing and a copy of which is
made available to the public not later than the date the Lock-up Bid
(as defined below) is publicly announced) pursuant to which such
holders agree to deposit or tender Voting Shares to a Take-over Bid
(the "Lock-up Bid") made by the Person, made by any of such Person's
Affiliates or Associates or made by any other Person acting jointly
or in concert with such Person and which provides:
(a) that any agreement to deposit or tender or to not withdraw
Voting Shares from the Lock-up Bid is terminable at the option
of any holder if:
(i) another Take-over Bid is made for the same class of
Voting Shares prior to Voting Shares being taken up and
paid for under the Lock-up Bid at a price or value per
Voting Share that is at least 5% in excess of the price
or value per Voting Share offered under the Lock-up Bid;
or
(ii) another Take-over Bid is made prior to Voting Shares
being taken up and paid for under the Lock-up Bid for a
number of Voting Shares at least 5% greater than the
number of Voting Shares that the Offeror has offered to
purchase under the Lock-up Bid at a price or value per
Voting Share that is not less than the price or value
per Voting Share offered under the Lock-up Bid; and
(b) no "break-up" fees, "top-up" fees, penalties, expenses or
other amounts that exceed in the aggregate the cash
equivalent of 2 1/2% of the price or value payable under the
Lock-up Bid to the holders of Voting Shares who are party
to the agreement shall be payable pursuant to the agreement
in the event that the Lock-up Bid is not successfully
concluded or if any holder fails to tender Voting Shares
pursuant thereto;
<PAGE>
(ae) "Person" shall include any individual, body corporate, firm,
partnership, association, trust, corporation, unincorporated
organization, syndicate, governmental entity or other entity;
(af) "Pro Rata Acquisition" shall mean the acquisition of Voting
Shares:
(i) as a result of a stock dividend, stock split or other event
pursuant to which a Person receives or acquires Voting Shares
of any class on the same pro rata basis as all other holders
of Voting Shares of the same class; or
(ii) pursuant to a Dividend Reinvestment Plan; or
(iii) pursuant to the acquisition or exercise by the Person of only
those rights to purchase Voting Shares distributed to that
Person in the course of a distribution to all holders of
securities of the Corporation of one or more particular
classes or series pursuant to a rights offering or pursuant to
a prospectus; or
(iv) pursuant to a distribution of Voting Shares, or securities
convertible into or exchangeable for Voting Shares (and the
conversion or exchange of such convertible or exchangeable
securities) made pursuant to a prospectus or by way of
private placement by the Corporation provided that (i) all
necessary stock exchange approvals for such private
placement have been obtained and such private placement
complies with the terms and conditions of such approvals,
and (ii) such Person does not become the Beneficial Owner
of more than 25% of the Voting Shares of the Corporation
outstanding immediately prior to the distribution, and in
making this determination the Voting Shares to be issued
to such person in the distribution shall be deemed to be
held by such Person but shall not be included in the
aggregate number of outstanding Voting Shares immediately
prior to the distribution;
(ag) "Record Time" shall have the meaning ascribed thereto in the
recitals to this Agreement;
(ah) "Right" shall have the meaning ascribed thereto in the recitals
to this Agreement;
(ai) "Rights Agent" shall mean Montreal Trust Company;
(aj) "Rights Certificates" shall mean the certificates representing the
Rights after the Separation Time, which shall be substantially in
the form attached hereto as Exhibit A;
(ak) "Rights Register" and "Rights Registrar" shall have the
respective meanings ascribed thereto in subsection 2.3(a);
(al) "Securities Act (Ontario)" shall mean the Securities Act, R.S.O.
1990, c. S.5, as amended, and the regulations thereunder, and any
comparable or successor laws or regulations thereto;
(am) "Securities Exchange Act" shall mean the United States Securities
Exchange Act of 1934, as amended, and the regulations thereunder,
and any comparable or successor laws or regulations thereto;
(an) "Separation Time" shall mean, subject to subsection 6.1(c), the
close of business on the eighth Trading Day after the earlier of:
(i) the Stock Acquisition Date;
<PAGE>
(ii) the date of the commencement of, or first public announcement
(provided such announcement is made after the Record Time) of,
the intent of any Person (other than the Corporation or any
Subsidiary of the Corporation) to commence, a Take-over Bid
(other than a Permitted Bid or a Competing Permitted Bid); and
(iii) the date upon which a Permitted Bid ceases to be a Permitted
Bid;
(ao) "Stock Acquisition Date" shall mean the date of the first public
announcement (which, for purposes of this definition, shall include,
without limitation, the filing of a report pursuant to the
Securities Act (Ontario), the Securities Exchange Act or any other
applicable laws) by the Corporation or an Acquiring Person that a
Person has become an Acquiring Person;
(ap) "Subsidiary" of a Person shall have the meaning ascribed thereto
in the Securities Act (Ontario);
(aq) "Take-over Bid" shall mean an Offer to Acquire Voting Shares, or
securities convertible into Voting Shares if, assuming that the
Voting Shares or convertible securities subject to the Offer to
Acquire are acquired and are Beneficially Owned at the date of
such Offer to Acquire by the Person making such Offer to Acquire,
such Voting Shares (including Voting Shares that may be acquired
upon conversion of securities convertible into Voting Shares)
together with the Offeror's Securities, constitute in the
aggregate 20% or more of the outstanding Voting Shares at the
date of the Offer to Acquire;
(ar) "Termination Time" shall mean the time at which the right to
exercise Rights shall terminate pursuant to subsection 6.1(f) or
sections 6.15 or 6.16;
(as) "Trading Day", when used with respect to any securities, shall mean
a day on which the principal Canadian securities exchange on which
such securities are listed or admitted to trading is open for the
transaction of business or, if the securities are not listed or
admitted to trading on any Canadian securities exchange, a Business
Day;
(at) "Voting Share", shall mean the Common Shares of the Corporation and
any other shares in the capital of the Corporation entitled to vote
generally in the election of all directors.
1.2 Currency
All sums of money which are referred to in this Agreement are
expressed in lawful money of Canada, unless otherwise specified.
1.3 Descriptive Headings
Descriptive headings appear herein for convenience only and shall
not control or affect the meaning or construction of any of the provisions
hereof.
1.4 References to Agreement
References to "this Agreement", "hereto", "herein", "hereby",
"hereunder", "hereof" and similar expressions refer to this Agreement and not to
any particular Article, section, subsection, clause, subclause, subdivision or
other portion hereof and include any and every instrument supplemental or
ancillary hereto.
<PAGE>
1.5 Calculation of Number and Percentage of Beneficial Ownership of
Outstanding Voting Shares
(a) For the purposes of this Agreement, in determining the percentage of
the outstanding Voting Shares with respect to which a Person is or is deemed to
be the Beneficial Owner, all unissued Voting Shares of which such Person is
deemed to be the Beneficial Owner shall be deemed to be outstanding.
(b) The percentage of outstanding Voting Shares Beneficially Owned by any
Person shall, for the purposes of this Agreement, be and be deemed to be the
product determined by the formula:
100 x A
B
where:
A = the number of votes for the election of all directors
generally attaching to the outstanding Voting Shares
Beneficially Owned by such Person; and
B = the number of votes for the election of all directors
generally attaching to all outstanding Voting Shares.
The percentage of outstanding Voting Shares represented by any
particular group of Voting Shares acquired or held by any Person shall be
determined in like manner mutatis mutandis.
1.6 Acting Jointly or in Concert
For the purposes of this Agreement, a Person is acting jointly or in
concert with every Person who is a party to an agreement, commitment or
understanding, whether formal or informal, with the first Person or any
Associate or Affiliate thereof, for the purpose of acquiring or offering to
acquire Voting Shares (other than customary agreements with and between
underwriters and/or banking group members and/or selling group members in
connection with a distribution of securities of the Corporation pursuant to a
prospectus or by way of private placement).
ARTICLE 2
THE RIGHTS
2.1 Legend on Certificates
Certificates for Common Shares issued after the Record Time but
prior to the earlier of the Separation Time and the Expiration Time shall
evidence, in addition to the Common Shares, one Right for each Common Share
evidenced thereby and shall have impressed on, printed on, written on or
otherwise affixed to them the following legend:
UNTIL THE SEPARATION TIME (AS DEFINED IN THE RIGHTS AGREEMENT REFERRED TO
BELOW), THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO
CERTAIN RIGHTS AS SET FORTH IN A SHAREHOLDER RIGHTS PLAN AGREEMENT, DATED
AS OF THE 1ST DAY OF FEBRUARY, 1995 AND AMENDED AND RESTATED AS OF APRIL
28, 1995, MARCH 5, 1998 AND MAY 7, 1998 (THE "RIGHTS AGREEMENT"), BETWEEN
ST. LAURENT PAPERBOARD INC. (THE "CORPORATION") AND MONTREAL TRUST
COMPANY, AS RIGHTS AGENT, THE TERMS OF WHICH ARE HEREBY INCORPORATED
HEREIN BY REFERENCE AND A COPY OF WHICH MAY BE INSPECTED DURING NORMAL
BUSINESS HOURS AT THE PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION.
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, SUCH
<PAGE>
RIGHTS MAY BE AMENDED, TERMINATED, MAY EXPIRE, MAY BECOME VOID (IF, IN
CERTAIN CASES, THEY ARE "BENEFICIALLY OWNED" BY AN "ACQUIRING PERSON", AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT, WHETHER CURRENTLY HELD BY
OR ON BEHALF OF SUCH PERSON OR ANY SUBSEQUENT HOLDER) OR MAY BE EVIDENCED
BY SEPARATE CERTIFICATES AND MAY NO LONGER BE EVIDENCED BY THIS
CERTIFICATE. THE CORPORATION WILL MAIL OR ARRANGE FOR THE MAILING OF A
COPY OF THE RIGHTS AGREEMENT TO THE HOLDER OF THIS CERTIFICATE WITHOUT
CHARGE AS SOON AS IT IS PRACTICABLE AFTER THE RECEIPT OF A WRITTEN REQUEST
THEREFOR.
Certificates representing Common Shares that are issued and
outstanding at the Record Time shall evidence one Right for each Common Share
evidenced thereby, notwithstanding the absence of the foregoing legend until the
close of business on the earlier of the Separation Time and the Expiration Time.
2.2 Execution, Authentication, Delivery and Dating of Rights
Certificates
(a) The Rights Certificates shall be executed on behalf of the Corporation
by any of the Chairman of the Board, the President or any Vice-President,
together with any other of such Persons or together with any one of the
Secretary, the Treasurer, any Assistant Secretary or any Assistant Treasurer.
The signature of any of these officers of the Corporation on the Rights
Certificates may be manual or facsimile. Rights Certificates bearing the manual
or facsimile signatures of individuals who were at any time the proper officers
of the Corporation shall bind the Corporation, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
countersignature and delivery of such Rights Certificates.
(b) Promptly after the Corporation learns of the Separation Time, the
Corporation will notify the Rights Agent of such Separation Time and will
deliver Rights Certificates executed by the Corporation to the Rights Agent for
countersignature, and the Rights Agent shall manually countersign (in a manner
satisfactory to the Corporation) and deliver such Rights Certificates to the
holders of the Rights pursuant to subsection 3.1(c). No Rights Certificate shall
be valid for any purpose until countersigned by the Rights Agent as aforesaid.
(c) Each Rights Certificate shall be dated the date of the
countersignature thereof.
2.3 Registration, Registration of Transfer and Exchange
(a) After the Separation Time, the Corporation will cause to be kept a
register (the "Rights Register") in which, subject to such reasonable
regulations as it may prescribe, the Corporation will provide for the
registration and transfer of Rights. The Rights Agent is hereby appointed the
"Rights Registrar" for the purpose of maintaining the Rights Register for the
Corporation and registering Rights and transfers of Rights as herein provided
and the Rights Agent hereby accepts such appointment. In the event that the
Rights Agent shall cease to be the Rights Registrar, the Rights Agent will have
the right to examine the Rights Register at all reasonable times. After the
Separation Time and prior to the Expiration Time, upon surrender for
registration of transfer or exchange of any Rights Certificate, and subject to
the provisions of subsection (c) of this section 2.3, the Corporation will
execute, and the Rights Agent will manually countersign and deliver, in the name
of the holder or the designated transferee or transferees, as required pursuant
to the holder's instructions, one or more new Rights Certificates evidencing the
same aggregate number of Rights as did the Rights Certificates so surrendered.
(b) All Rights issued upon any registration of transfer or exchange of
Rights Certificates shall be valid obligations of the Corporation, and such
Rights shall be entitled to the same benefits under this Agreement as the Rights
surrendered upon such registration of transfer or exchange.
(c) Every Rights Certificate surrendered for registration of transfer or
exchange shall be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Corporation or the Rights Agent, as the
case may be, duly executed by the holder thereof or such holder's attorney duly
authorized in writing. As a condition to the issuance of any new Rights
Certificate under this section 2.3, the Corporation may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Rights Agent) in connection therewith.
<PAGE>
2.4 Mutilated, Destroyed, Lost and Stolen Rights Certificates
(a) If any mutilated Rights Certificate is surrendered to the Rights Agent
prior to the Expiration Time, the Corporation shall execute and the Rights Agent
shall manually countersign and deliver in exchange therefor a new Rights
Certificate evidencing the same number of Rights as the Rights Certificate so
surrendered.
(b) If there shall be delivered to the Corporation and the Rights Agent
prior to the Expiration Time: (i) evidence to their satisfaction of the
destruction, loss or theft of any Rights Certificate; and (ii) such security or
indemnity as may be required by them to save each of them and any of their
agents harmless, then, in the absence of notice to the Corporation or the Rights
Agent that such Rights Certificate has been acquired by a bona fide purchaser,
the Corporation shall execute and upon its request the Rights Agent shall
countersign and deliver, in lieu of any such destroyed, lost or stolen Rights
Certificate, a new Rights Certificate evidencing the same number of Rights as
did the Rights Certificate so destroyed, lost or stolen.
(c) As a condition to the issuance of any new Rights Certificate under
this section 2.4, the Corporation may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Rights
Agent) in connection therewith.
(d) Every new Rights Certificate issued pursuant to this section 2.4 in
lieu of any destroyed, lost or stolen Rights Certificate shall evidence the
contractual obligation of the Corporation, whether or not the destroyed, lost or
stolen Rights Certificate shall be at any time enforceable by anyone, and shall
be entitled to all the benefits of this Agreement equally and proportionately
with any and all other Rights duly issued by the Corporation.
2.5 Persons Deemed Owners of Rights
The Corporation, the Rights Agent and any agent of the Corporation
or the Rights Agent may deem and treat the Person in whose name such Rights
Certificate (or, prior to the Separation Time, the associated Common Share
certificate) is registered as the absolute owner thereof and of the Rights
evidenced thereby for all purposes whatsoever. As used in this Agreement, unless
the context otherwise requires, the term "holder" of any Rights shall mean the
registered holder of such Rights (or, prior to the Separation Time, the
associated Common Shares).
2.6 Delivery and Cancellation of Certificates
All Rights Certificates surrendered upon exercise or for redemption,
registration of transfer or exchange shall, if surrendered to any Person other
than the Rights Agent, be delivered to the Rights Agent and, in any case, shall
be promptly cancelled by the Rights Agent. The Corporation may at any time
deliver to the Rights Agent for cancellation any Rights Certificates previously
countersigned and delivered hereunder which the Corporation may have acquired in
any manner whatsoever, and all Rights Certificates so delivered shall be
promptly cancelled by the Rights Agent. No Rights Certificate shall be
countersigned in lieu of or in exchange for any Rights Certificates cancelled as
provided in this section 2.6, except as expressly permitted by this Agreement.
The Rights Agent shall, subject to applicable law, destroy all cancelled Rights
Certificates and deliver a certificate of destruction to the Corporation.
<PAGE>
2.7 Agreement of Rights Holders
Every holder of Rights by accepting the same consents and agrees
with the Corporation and the Rights Agent and with every other holder of Rights:
(a) to be bound by and subject to the provisions of this Agreement, as
amended and supplemented from time to time in accordance with the
terms hereof, in respect of the Rights held;
(b) that prior to the Separation Time, each Right will be transferable
only together with, and will be transferred by a transfer of, the
associated Common Share certificate representing such Right;
(c) that after the Separation Time, the Rights Certificates will be
transferable only upon registration of the transfer on the Rights
Register as provided herein;
(d) that prior to due presentment of a Rights Certificate (or, prior
to the Separation Time, the associated Common Share certificate)
for registration of transfer, the Corporation, the Rights Agent
and any agent of the Corporation or the Rights Agent may deem and
treat the Person in whose name the Rights Certificate (or, prior
to the Separation Time, the associated Common Share certificate)
is registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on such Rights Certificate or the associated Common Share
certificate made by anyone other than the Corporation or the
Rights Agent) for all purposes whatsoever, and neither the
Corporation nor the Rights Agent shall be affected by any notice
to the contrary;
(e) that such holder of Rights has waived his right to receive any
fractional Rights or any fractional Common Shares upon exercise of a
Right (except as provided herein); and
(f) that without the approval of any holder of Rights or Voting Shares
and upon the sole authority of the Board of Directors acting in good
faith, this Agreement may be supplemented or amended from time to
time pursuant to and as provided herein.
2.8 Rights Certificate Holder Not Deemed a Shareholder
No holder, as such, of any Right or Rights Certificate shall be
entitled to vote, receive dividends or be deemed for any purpose whatsoever the
holder of any Common Share or any other security which may at any time be
issuable on the exercise of such Right, nor shall anything contained herein or
in any Rights Certificate be construed or deemed to confer upon the holder of
any Right or Rights Certificate, as such, any of the rights, titles, benefits or
privileges of a shareholder of the Corporation or any right to vote at any
meeting of shareholders of the Corporation whether for the election of directors
or otherwise or upon any matter submitted to holders of any Common Shares at any
meeting thereof, or to give or withhold consent to any action of the
Corporation, or to receive notice of any meeting or other action affecting any
shareholder of the Corporation (except as provided in section 6.7 hereof) except
as expressly provided herein, or to receive dividends, distributions or
subscription rights, or otherwise, until the Right or Rights evidenced by any
Rights Certificate shall have been duly exercised in accordance with the terms
and provisions hereof.
ARTICLE 3
EXERCISE OF THE RIGHTS
3.1 Initial Exercise Price; Exercise of Rights; Detachment of Rights
(a) Subject to adjustment as herein set forth, from and after the
Separation Time and prior to the Expiration Time, each Right will entitle the
holder thereof to purchase one Common Share for the Exercise Price (which
Exercise Price and number of Common Shares are subject to adjustment as set
forth below). Notwithstanding any other provision of this Agreement, any Rights
held by the Corporation or any of its Subsidiaries shall be void.
<PAGE>
(b) Until the Separation Time:
(i) the Rights shall not be exercisable and no Right may be
exercised; and
(ii) each Right will be evidenced by the certificate for the
associated Common Share registered in the name of the holder
thereof (which certificate shall also be deemed to be a Rights
Certificate) and will be transferable only together with, and
will be transferred by a transfer of, such associated Common
Share.
(c) From and after the Separation Time and prior to the Expiration Time:
(i) the Rights shall be exercisable; and
(ii) the registration and transfer of the Rights shall be separate
from and independent of Common Shares.
Promptly following the Separation Time, the Corporation will prepare
and the Rights Agent will mail to each holder of record of Common Shares as of
the Separation Time or, in the case of Debentures converted into Common Shares
after the Separation Time and prior to the close of business on the fifteenth
day following notice of the Stock Acquisition Date having been sent to the
holders of Debentures, promptly after such conversion, the Rights Agent will
mail to the holders so converting, (other than an Acquiring Person and other
than, in respect of any Rights Beneficially Owned by such Acquiring Person which
are not held of record by such Acquiring Person, the holder of Record of such
Rights (a "Nominee")), at such holder's address as shown on the records of the
Corporation (and the Corporation hereby agrees to furnish copies of such records
to the Rights Agent for this purpose):
(x) a Rights Certificate representing the number of Rights held
by such holder at the Separation Time in substantially the
form of Exhibit A hereto, appropriately completed,
representing the number of Rights held by such holder at
the Separation Time and having such marks of identification
or designation and such legends, summaries or endorsements
printed thereon as the Corporation may deem appropriate and
as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law,
rule, regulation or judicial or administrative order or
with any rule or regulation made pursuant thereto or with
any rule or regulation of any stock exchange or quotation
system on which the Rights may from time to time be listed
or traded, or to conform to usage; and
(y) a disclosure statement describing the Rights;
provided that a Nominee shall be sent the materials provided for in clauses (x)
and (y) only in respect of all Common Shares held of record by it which are not
Beneficially Owned by an Acquiring Person.
(d) Rights may be exercised in whole or in part on any Business Day after
the Separation Time and prior to the Expiration Time by submitting to the Rights
Agent:
(i) the Rights Certificate evidencing such Rights;
(ii) an election to exercise such Rights (an "Election to
Exercise") substantially in the form attached to the Rights
Certificate duly completed and executed by the holder or his
executors or administrators or other personal representatives
or his or their legal attorney duly appointed by an instrument
in writing in form and executed in a manner satisfactory to
the Rights Agent;
<PAGE>
(iii) payment in cash, or by certified cheque, banker's draft or
money order payable to the order of the Corporation, of a sum
equal to the applicable Exercise Price multiplied by the
number of Rights being exercised and a sum sufficient to cover
any transfer tax or charge which may be payable in respect of
any transfer involved in the transfer or delivery of Rights
Certificates or the issuance or delivery of certificates for
the relevant Common Shares in a name other than that of the
holder of the Rights being exercised.
(e) Upon receipt of the Rights Certificate which is accompanied by a
completed Election to Exercise that does not indicate that such Right is null
and void as provided by subsection 4(b) and payment as set forth in subsection
3.1(d), the Rights Agent (unless otherwise instructed by the Corporation in the
event that the Corporation is of the opinion that the Rights cannot be exercised
in accordance with this Agreement) will thereupon promptly:
(i) requisition from a transfer agent for the relevant Common
Shares, certificates representing the number of such Common
Shares to be purchased (the Corporation hereby irrevocably
authorizing its transfer agent to comply with all such
requisitions);
(ii) when appropriate, requisition from the Corporation the amount
of cash to be paid in lieu of issuing fractional Common
Shares;
(iii) after receipt of such Common Share certificate, deliver the
same to or to the order of the registered holder of such
Rights Certificate, registered in such name or names as may be
designated by such holder;
(iv) when appropriate, after receipt, deliver such cash referred to
in clause (ii) above to or to the order of the registered
holder of the Rights Certificate; and
(v) tender to the Corporation all payments received on exercise of
the Rights.
(f) In case the holder of any Rights shall exercise less than all the
Rights evidenced by such holder's Rights Certificate, a new Rights Certificate
evidencing the Rights remaining unexercised will be issued by the Rights Agent
to such holder or to such holder's duly authorized assigns.
(g) The Corporation covenants and agrees that it will:
(i) take all such action as may be necessary and within its power
to ensure that all Common Shares delivered upon exercise of
Rights shall, at the time of delivery of the certificates
representing such Common Shares (subject to payment of the
Exercise Price), be duly and validly authorized, executed,
issued and delivered as fully paid and non-assessable;
(ii) take all such action as may be necessary and within its
power to comply with any applicable requirements of the
Canada Business Corporations Act, the Securities Act
(Ontario) and the securities acts or comparable legislation
of each of the other provinces of Canada and any other
applicable law, rule or regulation, in connection with the
issuance and delivery of the Rights Certificates and the
issuance of any Common Shares upon exercise of Rights;
(iii) use reasonable efforts to cause all Common Shares issued upon
exercise of Rights to be listed on the principal exchanges on
which the Common Shares were traded prior to the Stock
Acquisition Date;
(iv) cause to be reserved and kept available out of its authorized
and unissued Common Shares the number of Common Shares that,
as provided in this Agreement, will from time to time be
sufficient to permit the exercise in full of all outstanding
Rights; and
<PAGE>
(v) pay when due and payable, if applicable, any and all
federal, provincial and municipal transfer taxes (for
greater certainty, not including any income or capital
taxes of the holder or exercising holder or any liability
of the Corporation to withhold tax) and charges which may
be payable in respect of the original issuance or delivery
of the Rights Certificates or certificates for Shares,
provided that the Corporation shall not be required to pay
any transfer tax or charge which may be payable in respect
of any transfer involved in the transfer or delivery of
Rights Certificates or the issuance or delivery of
certificates for Common Shares in a name other than that of
the holder of the Rights being transferred or exercised.
3.2 Adjustments to Exercise Price; Number of Rights
The Exercise Price, the number of Common Shares or other securities
subject to purchase upon the exercise of each Right and the number of Rights
outstanding are subject to adjustment from time to time as provided in this
section 3.2.
(a) In the event the Corporation shall at any time after the date of
this Agreement:
(i) declare or pay a dividend on the Common Shares payable in
Common Shares (or other securities exchangeable for or
convertible into or giving a right to acquire Common Shares)
other than pursuant to any optional Dividend Reinvestment
Plan;
(ii) subdivide or change the outstanding Common Shares into a
greater number of Common Shares;
(iii) combine or change the outstanding Common Shares into a smaller
number of Common Shares; or
(iv) issue any Common Shares (or other securities exchangeable for
or convertible into or giving a right to acquire Common
Shares) in respect of, in lieu of or in exchange for existing
Common Shares;
the Exercise Price and the number of Rights outstanding, or, if the
payment or effective date therefor shall occur after the Separation
Time, the securities purchasable upon exercise of Rights shall be
adjusted as of the payment or effective date in the manner set forth
below.
If the Exercise Price and number of Rights outstanding are to be
adjusted:
(x) the Exercise Price in effect after such adjustment will be
equal to the Exercise Price in effect immediately prior to
such adjustment divided by the number of Common Shares (or
other capital stock) (the "Expansion Factor") that a holder of
one Common Share immediately prior to such dividend,
subdivision, change, consolidation or issuance would hold
thereafter as a result thereof; and
(y) each Right held prior to such adjustment will become that
number of Rights equal to the Expansion Factor,
and the adjusted number of Rights will be deemed to be distributed
among the Common Shares with respect to which the original Rights
were associated (if they remain outstanding) and the shares issued
in respect of such dividend, subdivision, change, consolidation or
issuance, so that each such Common Share (or other capital stock)
will have exactly one Right associated with it.
<PAGE>
For greater certainty, if the securities purchasable upon exercise
of Rights are to be adjusted, the securities purchasable upon
exercise of each Right after such adjustment will be the securities
that a holder of the securities purchasable upon exercise of one
Right immediately prior to such dividend, subdivision, change,
consolidation or issuance would hold thereafter as a result of such
dividend, subdivision, change, consolidation or issuance.
If, after the Record Time and prior to the Expiration Time, the
Corporation shall issue any shares of capital stock other than
Common Shares in a transaction of a type described in Clause
3.2(a)(i) or (iv), shares of such capital stock shall be treated
herein as nearly equivalent to Common Shares as may be practicable
and appropriate under the circumstances and the Corporation and the
Rights Agent agree to amend this Agreement in order to effect such
treatment.
In the event the Corporation shall at any time after the Record Time
and prior to the Separation Time issue any Common Shares otherwise
than in a transaction referred to in this subsection 3.2(a), each
such Common Share so issued shall automatically have one new Right
associated with it, which Right shall be evidenced by the
certificate representing such associated Common Share.
(b) In case the Corporation shall at any time after the Record Time
and prior to the Expiration Time fix a record date for the
issuance of rights, options or warrants to all holders of Common
Shares entitling them to subscribe for or purchase (for a period
expiring within 45 calendar days after such record date) Common
Shares (or shares having the same rights, privileges and
preferences as Common Shares ("equivalent common shares")) or
securities convertible into Common Shares or equivalent common
shares at a price per Common Share or per equivalent common share
(or having a conversion, exchange or exercise price per share,
including the price required to be paid to purchase such
convertible or exchangeable securities or rights, if a security
convertible into Common Shares or equivalent common shares) of
less than 90% of the Market Price per Common Share on such record
date, the Exercise Price in respect of the Rights to be in effect
after such record date shall be determined by multiplying the
Exercise Price in respect of the Rights in effect immediately
prior to such record date by a fraction:
(i) the numerator of which shall be the number of Common Shares
outstanding on such record date, plus the number of Common
Shares that the aggregate offering price of the total
number of Common Shares and/or equivalent common shares so
to be offered (and/or the aggregate initial conversion,
exchange or exercise price of the convertible or
exchangeable securities or rights so to be offered,
including the price required to be paid to purchase such
convertible or exchangeable securities or rights) would
purchase at such Market Price per Common Share; and
(ii) the denominator of which shall be the number of Common Shares
outstanding on such record date, plus the number of additional
Common Shares and/or equivalent common shares to be offered
for subscription or purchase (or into which the convertible or
exchangeable securities or rights so to be offered are
initially convertible, exchangeable or exercisable).
In case such subscription price may be paid by delivery of
consideration, part or all of which may be in a form other than
cash, the value of such consideration shall be as determined in good
faith by the Board of Directors, whose determination shall be
described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent and the holders of the Rights. Such
<PAGE>
adjustment shall be made successively whenever such a record date is
fixed and, in the event that such rights, options or warrants are
not so issued, or if issued, are not exercised prior to the
expiration thereof, the Exercise Price in respect of the Rights
shall be re-adjusted to be the Exercise Price which would then be in
effect if such record date had not been fixed, or to the Exercise
Price which would be in effect based upon the number of Common
Shares (or securities convertible into, or exchangeable or
exercisable for Common Shares) actually issued upon the exercise of
such rights, options or warrants, as the case may be.
(c) For purposes of this Agreement, the granting of the right to
purchase Common Shares (whether from treasury or otherwise)
pursuant to a Dividend Reinvestment Plan or any employee
benefit, stock option or similar plans (so long as such right to
purchase is in no case evidenced by the delivery of rights or
warrants) shall be deemed not to constitute an issue of rights,
options or warrants by the Corporation; provided, however, that,
in all such cases, the right to purchase Common Shares is at a
price per share of not less than 90% of the current market price
per share (determined as provided in such plans) of the Common
Shares.
(d) In case the Corporation shall at any time after the Record Time
and prior to the Expiration Time fix a record date for a
distribution to all holders of Common Shares (including any such
distribution made in connection with a merger or amalgamation in
which the Corporation is the continuing corporation) of evidences
of indebtedness or assets, including cash, (other than a dividend
paid in the ordinary course or a dividend paid in Common Shares,
but including any dividend payable in securities other than
Common Shares), assets or subscription rights, options or
warrants entitling them to subscribe for or purchase Common
Shares (excluding those referred to in subsection 3.2(b)), the
Exercise Price in respect of the Rights to be in effect after
such record date shall be determined by multiplying the Exercise
Price in respect of the Rights in effect immediately prior to
such record date by a fraction:
(i) the numerator of which shall be the Market Price per Common
Share on such record date, less the fair market value (as
determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with
the Rights Agent and shall be binding on the Rights Agent
and the holders of the Rights), on a per share basis, of
the portion of the cash, assets or evidences of
indebtedness so to be distributed or of such subscription
rights, options or warrants applicable to a Common Share;
and
(ii) the denominator of which shall be such Market Price per Common
Share.
Such adjustments shall be made successively whenever such a record
date is fixed and, in the event that such distribution is not so
made, the Exercise Price in respect of the Rights shall be adjusted
to be the Exercise Price in respect of the Rights which would have
been in effect if such record date had not been fixed.
(e) Notwithstanding anything herein to the contrary, no adjustment in
an Exercise Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in such Exercise
Price; provided, however, that any adjustments which by reason of
this subsection 3.2(e) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment. All calculations under this section 3.2 shall be
made to the nearest cent or to the nearest ten-thousandth of a
Common Share or other share, as the case may be. Notwithstanding
the first sentence of this subsection 3.2(e), any adjustment
required by this section 3.2 shall be made no later than the
earlier of: (i) three years from the date of the transaction
which mandates such adjustment; and (ii) the Termination Time.
(f) If as a result of an adjustment made pursuant to section 4, the
holder of any Right thereafter exercised shall become entitled to
receive any shares other than Common Shares, thereafter the
number of such other shares so receivable upon exercise of any
Right and the applicable Exercise Price thereof shall be subject
to adjustment from time to time in a manner and on terms as
nearly equivalent as is practicable to the provisions with
respect to the Common Shares contained in this section 3.2, and
the provisions of this Agreement with respect to the Common
Shares shall apply on like terms to any such other shares.
<PAGE>
(g) In the event the Corporation shall at any time after the Record
Time and prior to the Separation Time issue any shares of capital
stock (other than Common Shares), or rights, options or warrants
to subscribe for or purchase any such capital stock, or
securities convertible into or exchangeable for any such capital
stock in a transaction referred to in clauses 3.2(a)(i) to (iv)
above, if the Board of Directors acting in good faith determines
that the adjustments contemplated by subsections 3.2(a), (b) or
(d) above in connection with such transaction will not
appropriately protect the interests of the holders of Rights, the
Board of Directors may determine what other adjustments to the
Exercise Price, number of Rights and/or securities purchasable
upon exercise of Rights would be appropriate. The Corporation and
the Rights Agent shall have authority to amend this Agreement as
appropriate to provide for such adjustments, subject to the prior
approval of the holders of the Common Shares or the holders of
Rights obtained as set forth in subsections 6.5(b) or (c), as the
case may be.
(h) All Rights originally issued by the Corporation subsequent to any
adjustment made to an Exercise Price hereunder shall evidence the
right to purchase, at the adjusted Exercise Price, the respective
number of Common Shares, as the case may be, purchasable from time
to time hereunder upon exercise of the Rights, all subject to
further adjustment as provided herein.
(i) Unless the Corporation shall have exercised its election as
provided in subsection 3.2(j), upon each adjustment of an
Exercise Price as a result of the calculations made in
subsections 3.2(b) and (d), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence
the right to purchase, at the adjusted Exercise Price, that
number of Common Shares, as the case may be, (calculated to the
nearest one ten-thousandth), obtained by:
(i) multiplying:
(A) the number of such Common Shares which would have been
issuable upon the exercise of a Right immediately prior
to this adjustment; by
(B) the relevant Exercise Price in effect immediately prior
to such adjustment of the relevant Exercise Price; and
(ii) dividing the product so obtained by the relevant Exercise
Price in effect immediately after such adjustment of the
relevant Exercise Price.
(j) The Corporation may elect on or after the date of any adjustment
of an Exercise Price to adjust the number of Rights, in lieu of
any adjustment in the number of Common Shares purchasable upon
the exercise of a Right. Each of the Rights outstanding after
the adjustment in the number of Rights shall be exercisable for
the number of Common Shares for which such a Right was
exercisable immediately prior to such adjustment. Each Right
held of record prior to such adjustment of the number of Rights
shall become that number of Rights (calculated to the nearest one
ten-thousandth) obtained by dividing the relevant Exercise Price
in effect immediately prior to adjustment of the relevant
Exercise Price by the relevant Exercise Price in effect
immediately after adjustment of the relevant Exercise Price. The
Corporation shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which
the relevant Exercise Price is adjusted or any day thereafter,
but, if the Rights Certificates have been issued, shall be at
least 10 days later than the date of the public announcement. If
Rights Certificates have been issued, upon each adjustment of the
number of Rights pursuant to this subsection 3.2(j), the
<PAGE>
Corporation shall, as promptly as is practicable, cause to be
distributed to holders of record of Rights Certificates on such
record date, Rights Certificates evidencing subject to section
6.4, the additional Rights to which such holders shall be
entitled as a result of such adjustment, or, at the option of the
Corporation, shall cause to be distributed to such holders of
record in substitution and replacement for the Rights
Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof, if required by the
Corporation, new Rights Certificates evidencing all the Rights to
which such holders shall be entitled after such adjustment.
Rights Certificates to be so distributed shall be issued,
executed and countersigned in the manner provided for herein and
may bear, at the option of the Corporation, the relevant adjusted
Exercise Price and shall be registered in the names of holders of
record of Rights Certificates on the record date specified in the
public announcement.
(k) Irrespective of any adjustment or change in an Exercise Price or the
number of Common Shares issuable upon the exercise of the Rights,
the Rights Certificates theretofore and thereafter issued may
continue to express the relevant Exercise Price per Common Share and
the number of Common Shares which were expressed in the initial
Rights Certificates issued hereunder.
(l) In any case in which this section 3.2 shall require that an
adjustment in an Exercise Price be made effective as of a record
date for a specified event, the Corporation may elect to defer,
until the occurrence of such event, the issuance to the holder of
any Right exercised after such record date of the number of
Common Shares and other securities of the Corporation, if any,
issuable upon such exercise over and above the number of Common
Shares and other securities of the Corporation, if any, issuable
upon such exercise on the basis of the relevant Exercise Price in
effect prior to such adjustment; provided, however, that the
Corporation shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to receive
such additional Common Shares (fractional or otherwise) or other
securities upon the occurrence of the event requiring such
adjustment.
(m) Notwithstanding anything in this section 3.2 to the contrary, the
Corporation shall be entitled to make such reductions in each
Exercise Price, in addition to those adjustments expressly
required by this section 3.2, as and to the extent that in their
good faith judgment the Board of Directors shall determine to be
advisable in order that any: (i) consolidation or subdivision of
Common Shares; (ii) issuance wholly or in part for cash of any
Common Share or securities that by their terms are convertible
into or exchangeable for Common Shares; (iii) stock dividends; or
(iv) issuance of rights, options or warrants referred to in this
section 3.2, hereafter made by the Corporation to holders of its
Common Shares, shall not be taxable to such shareholders.
(n) The Corporation covenants and agrees that, after the Separation
Time, it will not, except as permitted by section 6.1 or 6.5, take
(or permit any Subsidiary of the Corporation to take) any action if
at the time such action is taken it is reasonably foreseeable that
such action will diminish substantially or otherwise eliminate the
benefits intended to be afforded by the Rights.
3.3 Date on Which Exercise is Effective
Each Person in whose name any certificate for Common Shares is
issued upon the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the Common Share or other securities, if
applicable, represented thereby on, and such certificate shall be dated, the
date upon which the Rights Certificates evidencing such Rights was duly
surrendered (together with a duly completed Election to Exercise) and payment of
the relevant Exercise Price for such Rights (and any applicable transfer taxes
and other governmental charges payable by the exercising holder hereunder) was
made: provided, however, that if the date of such surrender and payment is a
date upon which the relevant Common Share transfer books of the Corporation are
closed, such Person shall be deemed to have become the holder of record of such
Common Shares on, and such certificate shall be dated, the next succeeding
Business Day on which the relevant Common Share transfer books of the
Corporation are open.
<PAGE>
ARTICLE 4
ADJUSTMENTS TO THE RIGHTS UPON A FLIP-IN EVENT
(a) Subject to subsection 4(b) and subsections 6.1(b) and (c), in the
event that prior to the Expiration Time a Flip-in Event shall occur, each Right
shall constitute, effective on and after the later of its date of issue and the
close of business on the eighth Trading Day following the Stock Acquisition
Date, the right to purchase from the Corporation, upon payment of the relevant
Exercise Price and otherwise exercising such Right in accordance with the terms
hereof, that number of Common Shares having an aggregate Market Price on the
date of consummation or occurrence of such Flip-in Event equal to twice the
relevant Exercise Price for an amount in cash equal to the relevant Exercise
Price (such right to be appropriately adjusted in a manner analogous to the
applicable adjustments provided for in section 3.2 upon each occurrence after
the Stock Acquisition Date of any event analogous to any of the events described
in section 3.2).
(b) Notwithstanding anything in this Agreement to the contrary, upon the
occurrence of any Flip-in Event, any Rights that are or were Beneficially Owned
on or after the earlier of the Separation Time and the Stock Acquisition Date
by: (i) an Acquiring Person (or any Affiliate or Associate of an Acquiring
Person or any Person acting jointly or in concert with an Acquiring Person or
any Affiliate or Associate of an Acquiring Person); or (ii) a transferee or
other successor in title, directly or indirectly, (a "Transferee") of Rights
held by an Acquiring Person (or any Affiliate or Associate of an Acquiring
Person or any Person acting jointly or in concert with an Acquiring Person or
any Affiliate or Associate of an Acquiring Person) who becomes a Transferee
concurrently with or subsequent to the Acquiring Person becoming an Acquiring
Person in a transfer that the Board of Directors has determined is part of a
plan, arrangement or scheme of an Acquiring Person (or any Affiliate or
Associate of an Acquiring Person or any Person acting jointly or in concert with
an Acquiring Person or any Affiliate or Associate of an Acquiring Person), that
has the purpose or effect of avoiding clause 4(b)(i) shall become null and void
without any further action, and any holder of such Rights (including any
Transferee) shall not have any right whatsoever to exercise such Rights under
any provision of this Agreement and shall not have thereafter any other rights
whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise.
(c) Any Rights Certificate that represents Rights Beneficially Owned by a
Person described in either clauses (i) or (ii) of section 4(b) or transferred to
any Nominee of any such Person, and any Rights Certificate issued upon transfer,
exchange, replacement or adjustment of any other Rights Certificate referred to
in this sentence, shall contain the following legend:
THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE WERE BENEFICIALLY OWNED
BY A PERSON WHO WAS AN ACQUIRING PERSON OR WHO WAS AN AFFILIATE OR AN
ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT) OR WAS ACTING JOINTLY OR IN CONCERT WITH ANY OF THEM. THIS
RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY SHALL BECOME VOID IN
THE CIRCUMSTANCES SPECIFIED IN SECTION 4(b) OF THE RIGHTS AGREEMENT.
provided that the Rights Agent shall not be under any responsibility
to ascertain the existence of facts that would require the imposition of such
legend but shall be required to impose such legend only if instructed to do so
by the Corporation or if a holder fails to certify upon transfer or exchange in
the space provided on the Rights Certificate that such holder is not an
Acquiring Person or an Affiliate or Associate thereof.
(d) From and after the Separation Time, the Corporation shall do all such
acts and things as shall be necessary and within its power to ensure compliance
with the provisions of this section 4, including without limitation, all such
acts and things as may be required to satisfy the requirements of the Canada
Business Corporations Act and the Securities Act (Ontario) or comparable
legislation of any other applicable jurisdiction in respect of the issue of
Common Shares upon the exercise of Rights in accordance with this Agreement.
<PAGE>
ARTICLE 5
THE RIGHTS AGENT
5.1 General
(a) The Corporation hereby appoints the Rights Agent to act as agent for
the Corporation and the holders of Rights in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Corporation may from time to time appoint one or more Co-Rights Agents as it may
deem necessary or desirable. In the event the Corporation appoints one or more
Co-Rights Agents, the respective duties of the Rights Agents and Co-Rights
Agents shall be as the Corporation may determine. The Corporation also agrees to
indemnify the Rights Agent for, and to hold it harmless against, any loss,
liability or expense, incurred without negligence, bad faith or wilful
misconduct on the part of the Rights Agent, for anything done or omitted by the
Rights Agent in connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against any claim of
liability, which right to indemnification will survive the termination of this
Agreement.
(b) The Rights Agent shall be protected and shall incur no liability for
or in respect of any action taken, suffered or omitted by it in connection with
its administration of this Agreement in reliance upon any certificate for Common
Shares, Rights Certificate, certificate for other securities of the Corporation,
instrument of assignment or transfer, power of attorney, endorsement, affidavit,
letter, notice, direction, consent, certificate, statement or other paper or
document believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper Person or Persons.
5.2 Merger or Amalgamation or Change of Name of Rights Agent
(a) Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or amalgamated or with which it may be consolidated, or any
corporation resulting from any merger, amalgamation or consolidation to which
the Rights Agent or any successor Rights Agent is a party, or any corporation
succeeding to the shareholder or stockholder services business of the Rights
Agent or any successor Rights Agent, will be the successor to the Rights Agent
under this Agreement without the execution or filing of any paper or any further
act on the part of any of the parties hereto, provided that such corporation
would be eligible for appointment as a successor Rights Agent under the
provisions of section 5.4 hereof. In case at the time such successor Rights
Agent succeeds to the agency created by this Agreement any of the Rights
Certificates have been countersigned but not delivered, any such successor
Rights Agent may adopt the countersignature of the predecessor Rights Agent and
deliver such Rights Certificates so countersigned; and in case at that time any
of the Rights Certificates have not been countersigned, any successor Rights
Agent may countersign such Rights Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and in
all such cases such Rights Certificates will have the full force provided in the
Rights Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent is changed and at
such time any of the Rights Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Rights Certificates so countersigned; and in case at that time any
of the Rights Certificates shall not have been countersigned, the Rights Agent
may countersign such Rights Certificates either in its prior name or in its
changed name; and in all such cases such Rights Certificates shall have the full
force provided in the Rights Certificates and in this Agreement.
<PAGE>
5.3 Duties of Rights Agent
The Rights Agent undertakes the duties and obligations imposed by
this Agreement upon the following terms and conditions, by all of which the
Corporation and the holders of Rights Certificates, by their acceptance thereof,
shall be bound:
(a) the Rights Agent may consult with legal counsel (who may be legal
counsel for the Corporation) and the opinion of such counsel will be
full and complete authorization and protection to the Rights Agent
as to any action taken or omitted by it in good faith and in
accordance with such opinion;
(b) whenever in the performance of its duties under this Agreement
Rights Agent deems it necessary or desirable that any fact or
matter be proved or established by the Corporation prior to
taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and
established by a certificate signed by a Person believed by the
Rights Agent to be the Chairman of the Board, the President or
any Vice-President and by the Treasurer or the Secretary or any
Assistant-Treasurer or any Assistant-Secretary of the Corporation
and delivered to the Rights Agent; and such certificate will be
full authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this
Agreement in reliance upon such certificate;
(c) the Rights Agent will be liable hereunder only for its own
negligence, bad faith or wilful misconduct;
(d) the Rights Agent will not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the
certificates for Common Shares or the Rights Certificates (except
its countersignature thereof) or be required to verify the same, but
all such statements and recitals are and will be deemed to have been
made by the Corporation only;
(e) the Rights Agent will not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery
hereof (except the due authorization, execution and delivery
hereof by the Rights Agent) or in respect of the validity or
execution of any Common Share certificate or Rights Certificates
(except its countersignature thereof); nor will it be responsible
for any breach by the Corporation of any covenant or condition
contained in this Agreement or in any Rights Certificates; nor
will it be responsible for any change in the exercisability of
the Rights (including the Rights becoming void pursuant to
subsection 4(b)) or any adjustment required under the provisions
of section 3.2 or responsible for the manner, method or amount of
any such adjustment or the ascertaining of the existence of facts
that would require any such adjustment (except with respect to
the exercise of Rights after receipt of the certificate
contemplated by section 3.2 describing any such adjustment); nor
will it by any act hereunder be deemed to make any representation
or warranty as to the authorization of any Common Shares to be
issued pursuant to this Agreement or any Rights or as to whether
any Shares will, when issued, be duly and validly authorized,
executed, issued and delivered as fully paid and non-assessable;
(f) the Corporation agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and
assurances as may reasonably be required by the Rights Agent for the
carrying out or performing by the Rights Agent of the provisions of
this Agreement;
<PAGE>
(g) the Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties
hereunder from any Person believed by the Rights Agent to be the
Chairman of the Board, the President, any Vice-President or the
Secretary or the Treasurer or any Assistant-Secretary or any
Assistant-Treasurer of the Corporation, and to apply to such
Persons for advice or instructions in connection with its duties,
and it shall not be liable for any action taken or suffered by it
in good faith in accordance with instructions of any such Person;
(h) the Rights Agent and any shareholder or stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
Common Shares, Rights or other securities of the Corporation or
become pecuniarily interested in any transaction in which the
Corporation may be interested, or contract with or lend money to
the Corporation or otherwise act as fully and freely as though it
were not the Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent from acting in any other capacity
for the Corporation or for any other legal entity; and
(i) the Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either
itself or by or through its attorneys or agents, and the Rights
Agent will not be answerable or accountable for any act, default,
neglect or misconduct of any such attorneys or agents or for any
loss to the Corporation resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in
the selection and continued employment thereof.
5.4 Change of Rights Agent
The Rights Agent may resign and be discharged from its duties under
this Agreement upon 90 days' notice in writing (or such lesser notice as is
acceptable to the Corporation) mailed to the Corporation and to each transfer
agent of Common Shares by registered or certified mail, and to the holders of
the Rights in accordance with section 6.8. The Corporation may remove the Rights
Agent upon 30 days' notice in writing, mailed to the Rights Agent and to each
transfer agent of the Common Shares by personal delivery, registered or
certified mail, and to the holders of the Rights in accordance with section 6.8.
If the Rights Agent should resign or be removed or otherwise become incapable of
acting, the Corporation will appoint a successor to the Rights Agent. If the
Corporation fails to make such appointment within a period of 30 days after such
removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the holder of
any Rights (which holder shall, with such notice, submit such holder's Rights
Certificate for inspection by the Corporation), then, subject to prior written
notice to the Corporation, the holder of any Rights may apply to any court of
competent jurisdiction for the appointment of a new Rights Agent. Any successor
Rights Agent, whether appointed by the Corporation or by such a court, shall be
a corporation incorporated under the laws of Canada or a province thereof
authorized to carry on the business of a trust company in the Province of
Quebec. After appointment, the successor Rights Agent will be vested with the
same powers, rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the predecessor Rights
Agent shall deliver and transfer to the successor Rights Agent any property at
the time held by it hereunder and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later than the effective
date of any such appointment, the Corporation will file notice thereof in
writing with the predecessor Rights Agent and each transfer agent of the Common
Shares, and mail a notice thereof in writing to the holders of the Rights.
Failure to give any notice provided for in this section 5.4, however, or any
defect therein, shall not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the successor Rights Agent, as
the case may be.
ARTICLE 6
MISCELLANEOUS
6.1 Redemption and Waiver
(a) The Board of Directors may, subject to the prior approval of the
holders of the Common Shares or the holders of the Rights obtained as set forth
in subsections 6.5(b) or (c), as the case may be, at any time prior to the
occurrence of a Flip-in Event as to which the application of section 4 has not
been waived pursuant to this section 6.1, elect to redeem all but not less than
all of the then outstanding Rights at a redemption price of $0.001 per Right,
appropriately adjusted in a manner analogous to the applicable adjustment
provided for in section 3.2, if an event of the type analogous to any of the
events described in section 3.2 shall have occurred (such redemption price being
herein referred to as the "Redemption Price").
<PAGE>
(b) The Board of Directors acting in good faith may, until the occurrence
of a Flip-in Event, upon prior written notice delivered to the Rights Agent,
determine to waive the application of section 4 to a particular Flip-in Event
that would result from a Take-over Bid made by way of take-over bid circular to
all holders of record of Voting Shares (which for greater certainty shall not
include the circumstances described in subsection 6.1(c)); provided that if the
Board of Directors waives the application of section 4 to a particular Flip-in
Event pursuant to this subsection 6.1(b), the Board of Directors shall be deemed
to have waived the application of section 4 to any other Flip-in Event occurring
by reason of any Take-over Bid which is made by means of a take-over bid
circular to all holders of record of Voting Shares prior to the expiry of any
Take-over Bid in respect of which a waiver is, or is deemed to have been,
granted under this subsection 6.1(b).
(c) Notwithstanding the provisions of subsection 6.1(b) hereof, the Board
of Directors of the Corporation may waive the application of section 4 in
respect of any Flip-in Event, provided that both of the following conditions are
satisfied:
(i) the Board of Directors has determined, within 8 Trading Days
following a Stock Acquisition Date, that a Person became an
Acquiring Person by inadvertence and without any intention to
become, or knowledge that it would become, an Acquiring
Person; and
(ii) such Person has, within 14 days after such determination or
such earlier or later period as the Board of Directors may
determine, (the "Disposition Date") reduced its Beneficial
Ownership of Voting Shares such that at the time of the
granting of a waiver pursuant to this subsection 6.1(c)
such Person is no longer an Acquiring Person; if the Person
remains an Acquiring Person at the close of business on the
Disposition Date, the Disposition Date shall be deemed to
be the date of occurrence of a further Stock Acquisition
Date and section 4 shall apply thereto,
and, in the event of any such waiver, for the purposes of this Agreement, such
Flip-in Event shall be deemed not to have occurred and the Separation Time shall
be deemed not to have occurred as a result of such Person having inadvertently
become an Acquiring Person.
(d) Where a Person acquires pursuant to a Permitted Bid, a Competing
Permitted Bid or an Exempt Acquisition under subsection 6.1(b) outstanding
Common Shares, other than Common Shares Beneficially Owned at the date of the
Permitted Bid, the Competing Permitted Bid or the Exempt Acquisition under
subsection 6.1(b) by such Person, then the Board of Directors of the Corporation
shall immediately upon the consummation of such acquisition without further
formality, including any approval under subsection 6.1(a), be deemed to have
elected to redeem the Rights at the Redemption Price.
(e) Where a Take-over Bid that is not a Permitted Bid is withdrawn or
otherwise terminated after the Separation Time has occurred and prior to the
occurrence of a Flip-in Event, the Board of Directors may elect to redeem all
the outstanding Rights at the Redemption Price.
(f) If the Board of Directors elects or is deemed to have elected to
redeem the Rights, the right to exercise the Rights will thereupon, without
further action and without notice, terminate, and the only right thereafter of
the holders of Rights shall be to receive the Redemption Price.
<PAGE>
(g) Within 10 days after the Board of Directors electing or having been
deemed to have elected to redeem the Rights, the Corporation shall give notice
of redemption to the holders of the then outstanding Rights by mailing such
notice to each such holder at his last address as it appears upon the registry
books of the Rights Agent or, prior to the Separation Time, on the registry
books of the Transfer Agent for the Common Shares. Any notice which is mailed in
the manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made. The Corporation may not
redeem, acquire or purchase for value any Rights at any time in any manner other
than that specifically set forth in this section 6.1, and other than in
connection with the purchase of Common Shares prior to the Separation Time.
(h) Upon the Rights being redeemed pursuant to subsection 6.1(e), all the
provisions of this Agreement shall continue to apply as if the Separation Time
had not occurred and Rights Certificates representing the number of Rights held
by each holder of record of Common Shares as of the Separation Time had not been
mailed to each such holder and from all purposes of this Agreement the
Separation Time shall be deemed not to have occurred.
6.2 Expiration
No Person shall have any rights pursuant to this Agreement or in
respect of any Right after the Expiration Time, except the Rights Agent as
specified in subsection 5.1(a).
6.3 Issuance of New Rights Certificate
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Corporation may, at its option, issue new Rights
Certificates evidencing Rights in such form as may be approved by the Board of
Directors to reflect any adjustment or change in the number or kind or class of
shares purchasable upon exercise of Rights made in accordance with the
provisions of this Agreement.
6.4 Fractional Rights and Fractional Shares
(a) The Corporation shall not be required to issue fractions of Rights or
to distribute Rights Certificates which evidence fractional Rights. After the
Separation Time, in lieu of such fractional Rights, there shall be paid to the
registered holders of the Rights Certificates with regard to which such
fractional Right would otherwise be issuable, an amount in cash equal to the
fraction of the Market Price of a whole Right that the fraction of a Right that
would otherwise be issuable is of one whole Right.
(b) The Corporation shall not be required to issue fractions of Common
Shares upon exercise of the Rights or to distribute certificates which evidence
fractional Common Shares. In lieu of issuing fractional Common Shares, the
Corporation shall pay to the registered holders of Rights Certificates; at the
time such Rights are exercised as herein provided, an amount in cash equal to
the same fraction of the Market Price of a whole Common Share that the fraction
of a Common Share that would be otherwise be issuable upon the exercise of such
Right is of one whole Common Share at the date of such exercise.
6.5 Supplements and Amendments
(a) The Corporation may make amendments to this Agreement to correct any
clerical or typographical error or which are required to maintain the validity
of this Agreement as a result of any change in any applicable legislation, rules
or regulations thereunder. The Corporation may, prior to the date of the
shareholders' meeting referred to in section 6.15, supplement or amend this
Agreement without the approval of any holders of Rights or Voting Shares in
order to make any changes which the Board of Directors acting in good faith may
deem necessary or desirable. Notwithstanding anything in this section 6.5 to the
contrary, no such supplement or amendment shall be made to the provisions of
Article 5 except with the written concurrence of the Rights Agent to such
supplement or amendment.
(b) Subject to the section 6.5(a), the Corporation may, with the prior
consent of the holders of Voting Shares obtained as set forth below, at any time
prior to the Separation Time, amend, vary or rescind any of the provisions of
this Agreement and the Rights (whether or not such action would materially
adversely affect the interests of the holders of Rights generally). Such consent
shall be deemed to have been given if the action requiring such approval is
authorized by the affirmative vote of a majority of the votes cast by
Independent Shareholders present or represented at and entitled to be voted at a
meeting of the holders of Voting Shares duly called and held in compliance with
applicable laws and the articles and by-laws of the Corporation.
<PAGE>
(c) The Corporation may, with the prior consent of the holders of Rights,
at any time on or after the Stock Acquisition Date, amend, vary or delete any of
the provisions of this Agreement and the Rights (whether or not such action
would materially adversely affect the interests of the holders of Rights
generally), provided that no such amendment, variation or deletion shall be made
to the provisions of Article 5 except with the written concurrence of the Rights
Agent thereto. Such consent shall be deemed to have been given if such
amendment, variation or deletion is authorized by the affirmative votes of the
holders of Rights present or represented at and entitled to be voted at a
meeting of the holders and representing 50% plus one of the votes cast in
respect thereof.
(d) Any approval of the holders of Rights shall be deemed to have been
given if the action requiring such approval is authorized by the affirmative
votes of the holders of Rights present or represented at and entitled to be
voted at a meeting of the holders of Rights and representing a majority of the
votes cast in respect thereof. For the purposes hereof, each outstanding Right
(other than Rights which are void pursuant to the provisions hereof) shall be
entitled to one vote, and the procedures for the calling, holding and conduct of
the meeting shall be those, as nearly as may be, which are provided in the
Corporation's by-laws and the Canada Business Corporations Act with respect to
meetings of shareholders of the Corporation.
(e) Any amendments made by the Corporation to this Agreement pursuant to
subsection 6.5(a) which are required to maintain the validity of this Agreement
as a result of any change in any applicable legislation, rules or regulation
thereunder shall:
(i) if made before the Separation Time, be submitted to the shareholders
of the Corporation at the next meeting of shareholders and the
shareholders may, by the majority referred to in subsection 6.5(b),
confirm or reject such amendment;
(ii) if made after the Separation Time, be submitted to the holders of
Rights at a meeting to be called for on a date not later than
immediately following the next meeting of shareholders of the
Corporation and the holders of Rights may, by resolution passed by
the majority referred to in subsection 6.5(d), confirm or reject
such amendment.
Any such amendment shall be effective from the date of the resolution of
the Board of Directors adopting such amendment, until it is confirmed or
rejected or until it ceases to be effective (as described in the next sentence)
and, where such amendment is confirmed, it continues in effect in the form so
confirmed. If such amendment is rejected by the shareholders or the holders of
Rights or is not submitted to the shareholders or holders of Rights as required,
then such amendment shall cease to be effective from and after the termination
of the meeting at which it was rejected or to which it should have been but was
not submitted or from and after the date of the meeting of holders of Rights
that should have been but was not held, and no subsequent resolution of the
Board of Directors to amend this Agreement to substantially the same effect
shall be effective until confirmed by the shareholders or holders of Rights as
the case may be.
<PAGE>
6.6 Rights of Action
Subject to the terms of this Agreement, all rights of action in
respect of this Agreement, other than rights of action vested solely in the
Rights Agent, are vested in the respective holders of the Rights; and any holder
of any Rights, without the consent of the Rights Agent or of the holder of any
other Rights, may, on such holder's own behalf and for such holder's own benefit
and the benefit of other holders of Rights, enforce, and may institute and
maintain any suit, action or proceeding against the Corporation to enforce, or
otherwise act in respect of, such holder's right to exercise such holder's
Rights in the manner provided in such holder's Rights Certificate and in this
Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach of this Agreement and
will be entitled to specific performance of the obligations under, and
injunctive relief against, actual or threatened violations of, the obligations
of any Person subject to this Agreement.
6.7 Notice of Proposed Actions
In case the Corporation shall propose after the Separation Time and
prior to the Expiration Time:
(a) to effect or permit (in cases where the Corporation's permission
is required) any Flip-in Event; or
(b) to effect the liquidation, dissolution or winding-up of the
Corporation or the sale of all or substantially all of the
Corporation's assets,
then, in each such case, the Corporation shall give to each holder of a Right,
in accordance with section 6.8, a notice of such proposed action, which shall
specify the date on which such Flip-in Event, liquidation, dissolution or
winding-up is to take place, and such notice shall be so given at least 10
Business Days prior to the date of taking such proposed action.
6.8 Notices
Notices or demands authorized or required by this Agreement to be
given or made by the Rights Agent or by the holder of any Rights to or on the
Corporation shall be sufficiently given or made if delivered or sent by
first-class mail, postage prepaid, or by fax (with, in the case of fax, an
original copy of the notice or demand sent by first-class mail, postage prepaid,
to the Corporation following the giving of the notice or demand by
fax),addressed (until another address is filed in writing with the Rights Agent)
as follows:
ST. LAURENT PAPERBOARD INC.
630, Rene-Levesque Blvd. West
Suite 3000
Montreal, Quebec
H3B 5C7
Attention: Vice-President, Administration
and Secretary
Any notice or demand authorized or required by this Agreement to be given or
made by the Corporation or by the holder of any Rights to or on the Rights Agent
shall be sufficiently given or made if delivered or sent by first-class mail,
postage prepaid, or by fax (with, in the case of fax, an original copy of the
notice or demand sent by first-class mail, postage prepaid, to the Rights Agent
following the giving of the notice or demand by fax) addressed (until another
address is filed in writing with the Corporation) as follows:
Montreal Trust Company
Corporate Trust Services
1800 McGill College Avenue, 7th Floor
Montreal, Qc
H3A 3K9
Attention: Manager, Stock Transfer Services
Notices or demands authorized or required by this Agreement to be given or made
by the Corporation or the Rights Agent to or on the holder of any Rights shall
be sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, or by fax (with, in the case of fax, an original copy of the notice or
demand sent by first-class mail, postage prepaid, to such holder following the
giving of the notice or demand by fax) addressed to such holder at the address
of such holder as it appears upon the registry books of the Rights Agent or,
prior to the Separation Time, on the registry books of the Corporation for the
Common Shares. Any notice which is sent in the manner herein provided shall be
deemed given, whether or not the holder receives the notice.
<PAGE>
6.9 Costs of Enforcement
The Corporation agrees that if the Corporation fails to fulfil any
of its obligations pursuant to this Agreement, then the Corporation will
reimburse the holder of any Rights for the costs and expenses (including legal
fees) incurred by such holder in actions to enforce his rights pursuant to any
Rights or this Agreement.
6.10 Successors
All the covenants and provisions of this Agreement by or for the
benefit of the Corporation or the Rights Agent shall bind and enure to the
benefit of their respective successors and assigns hereunder.
6.11 Benefits of this Agreement
Nothing in this Agreement shall be construed to give to any Person
other than the Corporation, the Rights Agent and the holders of the Rights any
legal or equitable right, remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit of the Corporation, the
Rights Agent and the holders of the Rights.
6.12 Governing Law
This Agreement and each Right issued hereunder shall be deemed to be
a contract made under the laws of the Province of Quebec and for all purposes
shall be governed by and construed in accordance with the laws of such province
applicable to contracts to be made and performed entirely within such province.
6.13 Counterparts
This Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same
instrument.
6.14 Severability
If any section, subsection, clause, subclause, term or provision
hereof or the application thereof to any circumstance shall, in any jurisdiction
and to any extent, be invalid or unenforceable, such section, subsection,
clause, subclause, term or provision shall be ineffective as to such
jurisdiction to the extent of such invalidity or unenforceability without
invalidating or rendering unenforceable the remaining sections, subsections,
clauses, subclauses, terms and provisions hereof or the application of such
section, subsection, clause, subclause, term or provision to circumstances other
than those as to which it is held invalid or unenforceable.
<PAGE>
6.15 Effective Date
Upon being reconfirmed and approved as provided in section 6.16,
this Agreement shall be effective and in full force and effect in accordance
with its terms from and after the Effective Date and amends, restates and
replaces in its entirety the Amended and Restated Agreement.
6.16 Reconfirmation and Approval: Reconfirmation
To become effective, this Agreement must be reconfirmed and approved
by a resolution passed by a majority of greater than 50% of the votes cast by
all holders of Voting Shares who vote in respect of such reconfirmation at the
1998 annual meeting of the Corporation. Notwithstanding such reconfirmation,
this Agreement must be reconfirmed by a resolution passed by a majority of
greater than 50% of the votes cast by all holders of Voting Shares who vote in
respect of such reconfirmation at every third annual meeting following the 1998
annual meeting. If the Agreement is not so reconfirmed or is not presented for
reconfirmation at such meeting, this Agreement and all outstanding Rights shall
terminate and be of no further force and effect on and from the date of
termination of the annual meeting; provided, that termination shall not occur if
a Flip-in Event has occurred (other than a Flip-in Event which has been waived
pursuant to subsection 6.1(b) or (c) hereof) prior to the date upon which this
Agreement would otherwise terminate pursuant to this section 6.16.
6.17 Actions by the Board of Directors
All actions, calculations and determinations (including all
omissions with respect to the foregoing) which are done or made by the Board of
Directors, in good faith, shall not subject the Board of Directors or any
director of the Corporation to any liability to the holders of the Rights
Certificates.
6.18 Time of the Essence
Time shall be of the essence in this Agreement.
6.19 Regulatory Approvals
Any obligation of the Corporation or action or event contemplated by
this Agreement shall be subject to the receipt of any requisite approval or
consent from any governmental or regulatory authority.
6.20 Language
Les parties aux presentes ont exige que la presente convention ainsi
que tous les documents et avis qui s'y rattachent et/ou qui en decouleront
soient rediges en langue anglaise. The parties hereto have required that this
Agreement and all documents and notices related thereto and/or resulting
therefrom be drawn up in the English language.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
ST. LAURENT PAPERBOARD INC.
By _________________________
MONTREAL TRUST COMPANY
By _________________________
And by _________________________
<PAGE>
EXHIBIT A
[FORM OF RIGHTS CERTIFICATE]
Certificate No. __________ __________ Rights
THE RIGHTS ARE SUBJECT TO TERMINATION ON THE TERMS SET FORTH IN THE
SHAREHOLDER RIGHTS PLAN AGREEMENT. UNDER CERTAIN CIRCUMSTANCES (SPECIFIED
IN SUBSECTION 4(b) OF THE SHAREHOLDER RIGHTS PLAN AGREEMENT), RIGHTS
BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR CERTAIN RELATED PARTIES, OR
TRANSFEREES OF AN ACQUIRING PERSON OR CERTAIN RELATED PARTIES, MAY BECOME
VOID.
RIGHTS CERTIFICATE
This certifies that ____________________ , or registered assigns, is
the registered holder of the number of Rights set forth above, each of which
entitles the registered holder thereof, subject to the terms, provisions and
conditions of the Shareholder Rights Plan Agreement made as of the 1st day of
February, 1995, as the same may be amended or supplemented from time to time,
(the "Rights Agreement") between St. Laurent Paperboard Inc., a corporation
incorporated under the laws of Canada (the "Corporation") and Montreal Trust
Company, a trust company incorporated under the laws of Canada, as rights agent
(the "Rights Agent", which term shall include any successor Rights Agent under
the Rights Agreement) to purchase from the Corporation at any time after the
Separation Time and prior to the Expiration Time (as such terms are defined in
the Rights Agreement), one fully paid Common Share of the Corporation (a "Common
Share") at the Exercise Price referred to below, upon presentation and surrender
of this Rights Certificate together with the Form of Election to Exercise and
Declaration of Ownership duly executed and submitted to the Rights Agent at its
principal office in any of the cities of Montreal, Toronto, Calgary, Vancouver
and Halifax. The Exercise Price shall initially be $65 per Right and shall be
subject to adjustment in certain events as provided in the Rights Agreement.
In certain circumstances described in the Rights Agreement, each
Right evidenced hereby may entitle the registered holder thereof to purchase or
receive assets, debt securities or shares in the capital of the Corporation
other than Common Shares, or more or less than one Common Share, all as provided
in the Rights Agreement.
This Rights Certificate is subject to all of the terms, provisions
and conditions of the Rights Agreement which terms, provisions and conditions
are hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Rights Agent, the Corporation and the holders of the Rights Certificates. Copies
of the Rights Agreement are on file at the registered office of the Corporation
and are available upon written request.
This Rights Certificate, with or without other Rights Certificates,
upon surrender at any of the offices of the Rights Agent designated for such
purpose, may be exchanged for another Rights Certificate or Rights Certificates
of like tenor and date evidencing an aggregate number of Rights equal to the
aggregate number of Rights evidenced by the Rights Certificate or Rights
Certificates surrendered. If this Rights Certificate shall be exercised in part,
the registered holder shall be entitled to receive, upon surrender hereof,
another Rights Certificate or Rights Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Rights Certificate (i) may be, and under certain circumstances
are required to be, redeemed by the Corporation at a redemption price of $0.001
per Right and (ii) may be exchanged at the option of the Corporation for cash,
debt or equity securities or other assets of the Corporation.
No fractional Common Shares will be issued upon the exercise of any
Right or Rights evidenced hereby, but in lieu thereof a cash payment will be
made, as provided in the Rights Agreement.
<PAGE>
No holder of this Rights Certificate, as such, shall be entitled to
vote or receive dividends or be deemed for any purpose the holder of Common
Shares or of any other securities of the Corporation which may at any time be
issuable upon the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a shareholder of the Corporation or any right to vote for the
election of directors or upon any matter submitted to shareholders of the
Corporation at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
shareholders of the Corporation (except as provided in the Rights Agreement), or
to receive dividends or subscription rights, or otherwise, until the Rights
evidenced by this Rights Certificate shall have been exercised as provided in
the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any
purpose until it shall have been manually countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the
Corporation and its corporate seal.
Date: __________________________
ST. LAURENT PAPERBOARD INC.
By: ______________________________ By: ________________________
President and Chief Executive Officer Secretary
Countersigned:
MONTREAL TRUST COMPANY
By: ______________________________
Authorized Signature
<PAGE>
FORM OF ELECTION TO EXERCISE AND CERTIFICATE
(To be executed by the registered holder if such holder desires to exercise the
Rights evidenced by the Rights Certificate)
TO: St. Laurent Paperboard Inc. and Montreal Trust Company
The undersigned hereby irrevocably elects to exercise _____ whole
Rights evidenced by the attached Rights Certificate to purchase the Common
Shares or other securities, if applicable, issuable upon the exercise of such
Rights and requests that certificates for such securities be issued to:
- -----------------------------------------------------
Name
- -----------------------------------------------------
Address
- -----------------------------------------------------
City and Province
- -----------------------------------------------------
Social Insurance Number or other
taxpayer identification number
If such number of Rights shall not be all the Rights evidenced by this Rights
Certificate, a new Rights Certificate for the balance of such Rights shall be
registered in the name of and delivered to:
- -----------------------------------------------------
Name
- -----------------------------------------------------
Address
- -----------------------------------------------------
City and Province
- -----------------------------------------------------
Social Insurance Number or other
taxpayer identification number
Dated:____________________ ______________________________
Signature
Signature Guaranteed:
(Signature must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any
change whatsoever)
Signature must be guaranteed by a member firm of a recognized stock
exchange in Canada, a registered national securities exchange in the United
States, a member of the Investment Dealers Association of Canada or National
Association of Securities Dealers, Inc., or a commercial bank or trust company
having an office or correspondent in Canada or the United States.
CERTIFICATE
(To be completed if true)
The undersigned hereby represents, for the benefit of the Corporation and all
holders of Rights and Common Shares, that the Rights evidenced by this Rights
Certificate are not, and, to the knowledge of the undersigned, have never been,
Beneficially Owned by an Acquiring Person or an Affiliate or Associate thereof
or any person acting jointly or in concert with any of the foregoing.
Capitalized terms shall have the meaning ascribed thereto in the Rights
Agreement.
- ------------------------------------------------------------------------------
Signature
<PAGE>
FORM OF ASSIGNMENT AND CERTIFICATE
(To be executed by the registered holder if such holder desires to transfer the
Rights represented by this Rights Certificate.)
FOR VALUE RECEIVED _____________________________________________________
hereby sells, assigns and transfers unto _____________________________________
- ------------------------------------------------------
(Please print name and address of transferee)
- ------------------------------------------------------
the Rights represented by this Rights Certificate, together with all right,
title and interest therein.
Dated:____________________ ____________________
Signature
Signature
Signature Guaranteed:
(Signature must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any
change whatsoever)
Signature must be guaranteed by a member firm of a recognized stock
exchange in Canada, a registered national securities exchange in the United
States, a member of the Investment Dealers Association of Canada or National
Association of Securities Dealers, Inc., or a commercial bank or trust company
having an office or correspondent in Canada or the United States.
CERTIFICATE
(To be completed if true)
The undersigned hereby represents, for the benefit of the Corporation and all
holders of Rights and Common Shares, that the Rights evidenced by this Rights
Certificate are not, and, to the knowledge of the undersigned, have never been,
Beneficially Owned by an Acquiring Person or an Affiliate or Associate thereof
or any person acting jointly or in concert with any of the foregoing.
Capitalized terms shall have the meaning ascribed thereto in the Rights
Agreement.
-------------------------------
Signature
<PAGE>
NOTICE
In the event the certification set forth above in the Forms of
Assignment and Election is not completed, the Corporation will deem the
Beneficial Owner of the Rights evidenced by this Rights Certificate to be an
Acquiring Person or an Affiliate or Associate thereof and accordingly such
Rights will be null and void. No Rights Certificates shall be issued in exchange
for a Rights Certificate owned or deemed to have been owned by an Acquiring
Person or an Affiliate or Associate thereof, or by a Person acting jointly or in
concert with an Acquiring Person or an Affiliate or Associate thereof.
Capitalized terms shall have the meaning ascribed thereto in the Rights
Agreement.
EXHIBIT 5
December 1, 1999
St. Laurent Paperboard Inc.
630 Rene-Levesque Boulevard, West
Suite 3000
Montreal, Quebec H3B 5C7
Dear Sirs:
This opinion is being given in connection with the Registration
Statement on Form S-8 (the "Registration Statement") to be filed with the
Securities and Exchange Commission by St. Laurent Paperboard, Inc. (the
"Company") on the date hereof for the purpose of registering under the
Securities Act of 1933, as amended, the interests in the St. Laurent
Paperboard Inc. Directors' Stock Option and Share Purchase Plan, St. Laurent
Paperboard Inc. Long-Term Incentive Plan, St. Laurent Paperboard Inc.
Managers' Share Purchase Plan, and the St. Laurent Paperboard Inc. Managers'
Stock Option Plan (the "Plans"). In connection with this opinion, we have
examined such corporate records, certificates and other documents and such
questions of law as we have considered necessary or appropriate for the
purpose of this opinion.
Upon the basis of such examination, we advise you that, in our opinion,
the Common Shares have been legally authorized for issuance under the Plans and
when sold will be validly issued, fully paid and nonassessable shares of Common
Shares of the Company.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not hereby admit that we
are in a category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended.
Very truly yours,
ROBINSON & COLE LLP
By: /s/ David A. Garbus
David A. Garbus, A Partner
Exhibit 23.1
St. Laurent Paperboard Inc.
Form S-8
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the inclusion in the Registration Statement of St. Laurent
Paperboard Inc. on Form S-8 (the "S-8 Registration Statement"), relating to St.
Laurent Paperboard Inc. Managers' Stock Option Plan, Managers' Share Purchase
Plan, Long-Term Incentive Plan and Directors' Stock Option and Share Purchase
Plan, to be filed with the United States Securities and Exchange Commission, of
(i) our report dated January 29, 1999 appearing on page 24 of the Annual Report
of St. Laurent for the year ended December 31, 1998, (ii) our report dated
January 30, 1998 (except as to Note 17, which is as of February 26, 1998)
appearing on page 48 of the Annual Report of St. Laurent for the year ended
December 31, 1997, and (iii) our report dated January 31, 1997 appearing on page
37 of the Annual Report of St. Laurent for the year ended December 31, 1996. All
three such Annual Reports are filed as Exhibits to the Registration Statement of
St. Laurent on Form 40-F (the "40-F Registration Statement"), filed with the
Commission on June 12, 1998, and amended by Amendments filed with the Commission
on Form 40-F/A on July 29, 1998, September 4, 1998, November 6, 1998, June 8,
1999 and June 25, 1999. The 40-F Registration Statement is incorporated by
reference in the S-8 Registration Statement.
/s/: PricewaterhouseCoopers LLP
Chartered Accountants
Montreal, Quebec
November 30, 1999
