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EXHIBIT 10.2
FORM OF
PLAN OF ARRANGEMENT PROPOSED BY PTI
UNDER SECTION 186
OF THE BUSINESS CORPORATIONS ACT (ALBERTA)
INVOLVING AND AFFECTING
PTI AND THE HOLDERS OF ITS COMMON SHARES AND OPTIONS
AND PTI AMALCO AND THE HOLDERS OF ITS SHARES
AND PTI HOLDCO AND THE HOLDERS OF ITS SHARES
AND OSI
AND OSI ULC
ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS
In this Plan of Arrangement, unless there is something in the subject
matter or context inconsistent therewith, the following terms shall have the
respective meanings set out below and grammatical variations of such terms shall
have corresponding meanings:
"ABCA" means the Business Corporations Act (Alberta), as amended;
"Amalgamation" means the amalgamation of PTI and PTI Amalco provided
for in Section 2.1(b) hereof;
"Amalgamation Agreement" means the agreement attached hereto as
Appendix A, setting forth the terms and conditions of the Amalgamation;
"Arrangement" means the arrangement under section 186 of the ABCA on
the terms and subject to the conditions set out in this Plan of Arrangement,
subject to any amendments thereto made (i) in accordance with Section 14.1 of
the Combination Agreement; (ii) in accordance with Section 5.1 hereof or (iii)
at the direction of the Court in the Final Order;
"Arrangement Resolution" means the special resolution passed by the
Shareholders and the Optionholders at the Meeting or a resolution in writing
signed by all of the Shareholders and Optionholders in lieu of the Meeting;
"Automatic Redemption Date" has the meaning provided in the
Exchangeable Share Provisions;
"Business Day" has the meaning provided in the Exchangeable Share
Provisions;
"Class A Common Shares" means Class A Common Shares in the capital of
New PTI;
"Class B Common Shares" means Class B Common Shares in the capital of
New PTI;
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"Class C Common Shares" means Class C Common Shares in the capital of
New PTI;
"Class D Common Shares" means Class D Common Shares in the capital of
New PTI;
"Combination Agreement" means the combination agreement by and among
OSI, HWC Energy Services, Inc., Merger Sub-HWC, Inc., Sooner Inc., Merger
Sub-Sooner, Inc. and PTI dated as of July o, 2000, as amended and restated from
time to time, providing for, among other things, this Plan of Arrangement and
the Arrangement;
"Court" means the Court of Queen's Bench of Alberta;
"Depositary" means Montreal Trust Company of Canada at its principal
transfer offices in Calgary, Alberta;
"Dissent Procedures" has the meaning provided in Section 3.1;
"Effective Date" means the registration date shown on the registration
statement issued upon the filing of the Articles of Arrangement under the ABCA
giving effect to the Arrangement;
"Effective Time" means 6:00 a.m. (Edmonton time) on the Effective Date;
"Eligible Holders" has the meaning in Section 2.2(a);
"Exchange Ratio" means 3.7731 Exchangeable Shares for each whole PTI
Common Share, subject to adjustment as provided in accordance with Section 4.2
of the Combination Agreement;
"Exchangeable Share Provisions" means the rights, privileges,
restrictions and conditions attaching to the Exchangeable Shares as set forth in
Appendix B hereto;
"Exchangeable Shares" means the Exchangeable Shares in the capital of
PTI Holdco;
"Final Order" means the final order of the Court approving the
Arrangement, as such order may be amended by the Court at any time and from time
to time prior to the Effective Time;
"Interim Order" means the interim order of the Court in relation to the
Arrangement, as such order may be amended by the Court at any time and from time
to time;
"ITA" means the Income Tax Act (Canada), as amended;
"Measurement Period" means the period of 10 consecutive Business Days
ending on the third trading day prior to the OSI IPO Date;
"Meeting" means the special meeting of the Shareholders and of the
Optionholders of PTI to be held, if required, to consider this Plan of
Arrangement;
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"New PTI" means PTI Group Inc. a corporation amalgamated under the ABCA
pursuant to the Arrangement;
"New PTI Shares" means the Class A Common Shares, the Class B Common
Shares, the Class C Common Shares and the Class D Common Shares;
"Non-Accredited U.S. PTI Shareholder" means Peter McEwen, a
Shareholder;
"Option Agreements" mean the agreements between PTI and certain
directors and officers of PTI governing the Options;
"Optionholders" means holders of Options;
"Options" means all options to purchase PTI Common Shares outstanding
immediately prior to the Effective Date;
"OSI" means Oil States International, Inc., a corporation organized and
existing under the laws of Delaware and any successor corporation;
"OSI Common Stock" has the meaning provided in the Exchangeable Share
Provisions;
"OSI IPO" means the initial public offering of OSI Common Stock;
"OSI IPO Date" means the date the OSI IPO is completed;
"OSI IPO Price" means the price per share at which OSI Common Stock is
initially offered for sale to the public under the OSI IPO;
"OSI ULC" means o, an unlimited liability company organized and
existing under the laws of Nova Scotia and any successor corporation;
"PTI" means PTI Group Inc., a corporation organized and existing under
the laws of Alberta;
"PTI Amalco" means o, a corporation organized and existing under the
laws of Alberta and a wholly-owned subsidiary of PTI Holdco;
"PTI Amalco Common Shares" means the common shares in the capital of
PTI Amalco;
"PTI Common Shares" means the common shares in the capital of PTI;
"PTI Holdco" means o, a corporation organized and existing under the
laws of Alberta and a wholly-owned subsidiary of OSI ULC prior to giving effect
to the Arrangement, and any successor corporation;
"PTI Holdco Sub" means o, a corporation organized and existing under
the laws of Alberta and a wholly-owned subsidiary of PTI Holdco, and any
successor corporation;
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"Proxy Statement" means the Management Information Circular and Proxy
Statement of PTI prepared in connection with the Arrangement;
"RJM" means R.J.M. Equities Inc., a Shareholder;
"Shareholders" means holders of PTI Common Shares;
"Support Agreement" means the agreement so entitled between OSI and PTI
Holdco to be dated as of the Effective Date and provided for in the Combination
Agreement;
"Transfer Agent" means the duly appointed transfer agent for the time
being of the Exchangeable Shares, and, if there is more than one such transfer
agent, then the principal Canadian transfer agent;
"Unanimous Shareholder Agreement" means the Unanimous Shareholder
Agreement dated January 8, 1997 made among the Shareholders and PTI, as amended;
"U.S. PTI Shareholders" means SCF-III, L.P. and William Nungesser, each
a Shareholder.
"Voting and Exchange Trust Agreement" means the agreement so entitled
between OSI, PTI Holdco and the Trustee named therein to be dated as of the
Effective Date and provided for in the Combination Agreement;
"Voting Share" has the meaning ascribed to such term in the Voting and
Exchange Trust Agreement; and
"812375" means 812375 Alberta Ltd., a Shareholder.
1.2 SECTIONS, HEADINGS AND APPENDICES
The division of this Plan of Arrangement into sections and the
insertion of headings are for reference purposes only and shall not affect the
interpretation of this Plan of Arrangement. Unless otherwise indicated, any
reference in this Plan of Arrangement to a section refers to the specified
section of this Plan of Arrangement. Appendix A is incorporated into and forms
an integral part of this Plan of Arrangement.
1.3 NUMBER, GENDER AND PERSONS
In this Plan of Arrangement, unless the context otherwise requires,
words importing the singular number include the plural and vice versa, words
importing any gender include all genders and words importing persons include
individuals, bodies corporate, partnerships, associations, trusts,
unincorporated organizations, governmental bodies and other legal or business
entities of any kind.
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1.4 DATE FOR ANY ACTION
In the event that any date on or by which any action is required or
permitted to be taken hereunder is not a Business Day, such action shall be
required or permitted to be taken on or by the next succeeding day which is a
Business Day.
1.5 CURRENCY
Unless otherwise expressly stated herein, all references to currency
and payments in cash or money in this Plan of Arrangement are to United States
dollars.
1.6 STATUTORY REFERENCES
Any reference in this Plan of Arrangement to a statute includes such
statute as amended, consolidated or re-enacted from time to time, all
regulations made thereunder, all amendments to such regulations from time to
time, and any statute or regulation which supersedes such statute or
regulations.
ARTICLE 2
ARRANGEMENT
2.1 ARRANGEMENT
At the Effective Time, the following transactions shall occur and shall
be deemed to occur in the following order without any further act or formality:
(a) each Shareholder who has duly exercised the right of dissent as
set forth in Article 3 shall be deemed to have transferred the
PTI Common Shares held by such holder to PTI for cancellation and
such shares shall be cancelled and any Options held by such
Shareholder which have not been exercised prior to the time such
Shareholder exercises such right of dissent shall be deemed to be
transferred to PTI for no consideration and shall be cancelled
and shall no longer be outstanding and in no case shall PTI or
OSI be required to recognize such holders as Optionholders on and
after the Effective Time and the names of such persons shall be
deleted from the registers of Optionholders at the Effective
Time;
(b) the Unanimous Shareholder Agreement shall be terminated and of no
further force or effect;
(c) OSI shall acquire:
(i) all of the PTI Common Shares held by the Non-Accredited U.S.
PTI Shareholder in exchange for a payment, in United States
dollars, equal to the OSI IPO Price less underwriters'
discounts and commissions applicable to the OSI IPO,
multiplied by the Exchange Ratio multiplied by the number of
PTI Common Shares held by the Non-Accredited U.S. PTI
Shareholder; and
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(ii) all of the PTI Common Shares held by the U.S. PTI
Shareholders in exchange for the number of shares of OSI
Common Stock equal to the Exchange Ratio for each whole PTI
Common Share;
(d) OSI ULC shall acquire all of the PTI Common Shares acquired by
OSI pursuant to Section 2.1(c) hereof in exchange for one common
share in the capital of OSI ULC for each whole PTI Common Share;
(e) PTI Holdco shall acquire all of the PTI Common Shares acquired by
OSI ULC pursuant to Section 2.1(d) hereof in exchange for one
common share in the capital of PTI Holdco for each whole PTI
Common Share;
(f) PTI and PTI Amalco shall be amalgamated pursuant to the
Amalgamation Agreement to form New PTI;
(g) Upon the amalgamation of PTI and PTI Amalco to form New PTI:
(i) New PTI shall issue to PTI Holdco one Class A Common Share
for each of its PTI Common Shares;
(ii) New PTI shall issue to PTI Holdco one Class A Common Share
for each of its PTI Amalco Common Shares;
(iii) New PTI shall issue to 812375 one Class B Common Share for
each of its PTI Common Shares;
(iv) New PTI shall issue to RJM one Class C Common Share for
each of its PTI Common Shares;
(v) New PTI shall issue to each of the Shareholders other than
812375, RJM, PTI Holdco and holders of PTI Common Shares
in respect of which rights of dissent have been exercised
pursuant to Article 3 hereof and which have been cancelled
pursuant to Section 2.1(a) hereof one Class D Common Share
for each of their PTI Common Shares;
(vi) the amount added to the stated capital account maintained
for the Class A Common Shares with respect to the Class A
Common Shares issued pursuant to Sections 2.1(g)(i) and
(ii) shall be equal to the paid-up capital, for the
purposes of the ITA, of the PTI Common Shares and the PTI
Amalco Common Shares held by PTI Holdco;
(vii) the amount added to the stated capital account maintained
for the Class B Common Shares with respect to the Class B
Common Shares issued pursuant to Section 2.1(g)(iii) shall
be equal to the paid-up capital, for the purposes of the
ITA, of the PTI Common Shares held by 812375;
(viii) the amount added to the stated capital account maintained
for the Class C Common Shares issued pursuant to Section
2.1(g)(iv) shall be equal to the
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paid-up capital, for the purposes of the ITA, of the PTI
Common Shares held by RJM;
(ix) the amount added to the stated capital account maintained
for the Class D Common Shares with respect to the Class D
Common Shares issued pursuant to Section 2.1(g)(v) shall
be equal to the paid-up capital, for the purposes of the
ITA, of the PTI Common Shares other than (A) the PTI
Common Shares held by PTI Holdco, 812375 and RJM and (B)
PTI Common Shares in respect of which rights of dissent
have been exercised pursuant to Article 3 hereof and which
have been cancelled pursuant to Section 2.1(a) hereof.
(h) The stated capital account maintained for (i) the Class B Common
Shares shall be increased by a portion of the amount credited to
New PTI's retained earnings account equal to [$6,794,359] and
(ii) the Class C Common Shares shall be increased by a portion of
the amount credited to New PTI's retained earnings account equal
to [$3,903,303];
(i) The Articles of Incorporation of PTI Holdco shall be amended to
add (i) the Exchangeable Shares to the authorized capital of PTI
Holdco, (ii) the Exchangeable Share Provisions and (iii) certain
other provisions, set forth in Exhibit B to the Combination
Agreement and to delete the private company provisions;
(j) OSI and PTI Holdco shall execute and deliver the Support
Agreement;
(k) OSI, PTI Holdco and the Trustee shall execute and deliver the
Voting and Exchange Trust Agreement;
(l) PTI Holdco shall acquire all of the issued and outstanding Class
B Common Shares from the holders thereof in exchange for the
number of Exchangeable Shares equal to the Exchange Ratio for
each whole Class B Common Share;
(m) PTI Holdco shall acquire all of the issued and outstanding Class
C Common Shares from the holders thereof in exchange for the
number of Exchangeable Shares equal to the Exchange Ratio for
each whole Class C Common Share;
(n) PTI Holdco shall acquire all of the issued and outstanding Class
D Common Shares from the holders thereof in exchange for the
number of Exchangeable Shares equal to the Exchange Ratio for
each whole Class D Common Share;
(o) The amount added to the stated capital account maintained for the
Exchangeable Shares with respect to the Exchangeable Shares
issued pursuant to Section 2.1(l) shall be equal to the paid up
capital, for the purposes of the ITA, of the Class B Common
Shares;
(p) The amount added to the stated capital account maintained for the
Exchangeable Shares with respect to the Exchangeable Shares
issued pursuant to Section 2.1(m)
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shall be equal to the paid up capital, for the purposes of the
ITA, of the Class C Common Shares;
(q) The amount added to the stated capital account maintained for the
Exchangeable Shares with respect to the Exchangeable Shares
issued pursuant to Section 2.1(n) shall be equal to the paid up
capital, for the purposes of the ITA, of the Class D Common
Shares;
(r) Upon the transfer of New PTI Shares referred to in paragraphs
(l), (m) and (n) above:
(i) each holder of New PTI Shares shall cease to be such a
holder, shall have his name removed from the register of
holders of New PTI Shares and shall become a holder of the
number of fully paid Exchangeable Shares to which he is
entitled as a result of the transfer referred to above and
such holder's name shall be added to the register of holders
of Exchangeable Shares accordingly; and
(ii) PTI Holdco shall become the legal and beneficial owner of
all of the New PTI Shares so transferred.
(s) OSI shall issue to and deposit with the Depositary the Voting
Share in consideration of the payment to OSI of US$1, to be
thereafter held by the Depositary as trustee for and on behalf
of, and for the use and benefit of, the holders of the
Exchangeable Shares, in accordance with the Voting and Exchange
Trust Agreement.
(t) The then outstanding Options will, without any further action on
the part of any Optionholder: (i) if applicable, vest in
accordance with the terms and conditions of the Option
Agreements, and (ii) be converted into or exchanged for an option
to purchase the number of shares of OSI Common Stock determined
by multiplying the number of PTI Common Shares subject to such
Option at the Effective Time by the Exchange Ratio, at an
exercise price per share of OSI Common Stock equal to the
exercise price per share of such Option immediately prior to the
Effective Time divided by the Exchange Ratio, and expressed in
U.S. dollars. For the purposes of determining the exercise price
per share of OSI Common Stock, the exercise price per share of
PTI Common Shares subject to such Option shall be adjusted using
the Canadian dollar exchange rate based upon the average of the
noon buying rate expressed to the fourth decimal place for each
of the Business Days in the Measurement Period as reported by the
Bank of Canada. If the foregoing calculation results in a
converted Option being exercisable for a fraction of a share of
OSI Common Stock, then the number of shares of OSI Common Stock
subject to such Option will be rounded down to the nearest whole
number of shares, and the exercise price per whole share of OSI
Common Stock will be as determined above. The obligations of PTI
under the Options as so converted shall be assumed by OSI and OSI
shall be substituted for PTI under the Option Agreements. Except
as provided in this paragraph (d), the
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term and all other terms and conditions of the Options in effect
immediately prior to giving effect to the Arrangement shall
govern the Options.
(u) PTI Holdco Sub shall acquire all of the issued and outstanding
New PTI Shares from PTI Holdco in exchange for an equal number of
common shares in the capital of PTI Holdco Sub.
2.2 TAX MATTERS
(a) Holders of Exchangeable Shares who acquired them pursuant to the
transfers referred to above (the "Eligible Holders") shall be
entitled to make an election pursuant to subsection 85(1) of the
ITA and any corresponding applicable provincial legislation with
respect to the transfer of their New PTI Shares to PTI Holdco as
provided above by providing two signed copies of the necessary
election forms to PTI Holdco within 90 days following the
Effective Date, duly completed with the details of the number of
shares transferred, the adjusted cost base of those shares and
such agreed amounts as shall be determined by the Eligible
Holders for the purposes of such elections. Thereafter, subject
to the election forms complying with the provisions of the ITA
and any corresponding applicable provincial legislation, the
forms will be signed by PTI Holdco and returned to the Eligible
Holders within 30 days of receipt of such elections by PTI Holdco
for filing with Canada Customs and Revenue Agency or any
corresponding applicable provincial agency.
(b) The applicable agreed amount for the purposes of any election to
be made in accordance with Section 2.2(a) must comply with the
following rules:
(i) the agreed amount may not be less than the fair market
value, on the Effective Date, of the consideration (other
than Exchangeable Shares) received by an Eligible Holder
for the disposition to PTI Holdco of the New PTI Shares to
which the election applies;
(ii) the agreed amount may not be less than the lesser of (A)
the adjusted cost base to the Eligible Holder of the New
PTI Shares to which the election applies, determined
immediately before the time of the exchange, and (B) the
fair market value of such New PTI Shares at that time;
(iii) the agreed amount may not exceed the fair market value of
the New PTI Shares to which the election applies at the
time of the exchange.
ARTICLE 3
RIGHTS OF DISSENT
3.1 RIGHTS OF DISSENT
Registered Shareholders may exercise rights of dissent with respect to
their PTI Common Shares pursuant to and in the manner set forth in section 184
of the ABCA (as modified by the
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Interim Order) and this Section 3.1 (the "Dissent Procedures") in connection
with the Arrangement, and holders who duly exercise such rights of dissent and
who:
(a) are ultimately entitled to be paid fair value for the PTI Common
Shares shall be deemed to have transferred such PTI Common Shares
to PTI for cancellation on the Effective Date; or
(b) are ultimately not entitled, for any reason, to be paid the fair
value for their PTI Common Shares shall be deemed to have
participated in the Arrangement on the same basis as any
nondissenting Shareholder, as the case may be,
but in no case shall PTI be required to recognize such holders as Shareholders
on and after the Effective Time, and the names of such persons shall be deleted
from the registers of Shareholders at the Effective Time.
ARTICLE 4
CERTIFICATES AND FRACTIONAL SHARES
4.1 ISSUANCE OF CERTIFICATES REPRESENTING EXCHANGEABLE SHARES
At or promptly after the Effective Time, PTI Holdco shall deposit with
the Depositary, for the benefit of the Shareholders who ultimately exchanged
their PTI Common Shares for Exchangeable Shares pursuant to the Arrangement,
certificates representing the Exchangeable Shares issued pursuant to the
Arrangement upon the exchange. Upon surrender to the Depositary of a certificate
which immediately prior to the Effective Time represented outstanding PTI Common
Shares, and such additional documents and instruments as the Depositary may
reasonably require, the holder of such surrendered certificate shall be entitled
to receive in exchange therefor, and the Depositary shall forthwith deliver to
such holder, a certificate representing that number (rounded down to the nearest
whole number) of Exchangeable Shares which such holder has the right to receive
pursuant to the Arrangement (together with any dividends or distributions with
respect thereto pursuant to Section 4.2 and any cash in lieu of fractional
Exchangeable Shares pursuant to Section 4.3), and any certificate so surrendered
shall forthwith be canceled. In the event of a transfer of ownership of PTI
Common Shares which is not registered in the transfer records of PTI, a
certificate representing the proper number of Exchangeable Shares (together with
any dividends or distributions with respect thereto pursuant to Section 4.2 and
any cash in lieu of fractional Exchangeable Shares pursuant to Section 4.3)
shall be delivered to a transferee if the certificate representing such PTI
Common Shares is presented to the Depositary, accompanied by all documents
required to evidence and effect such transfer. Until surrendered as contemplated
by this Section 4.1, each certificate which immediately prior to the Effective
Time represented outstanding PTI Common Shares shall be deemed at any time after
the Effective Time, but subject to Section 4.8, to represent only the right to
receive upon such surrender (a) the certificate representing Exchangeable Shares
as contemplated by this Section 4.1, (b) a cash payment in lieu of any
fractional Exchangeable Shares as contemplated by Section 4.3 and (c) any
dividends or distributions with a record date after the Effective Time
theretofore paid or payable with respect to Exchangeable Shares as contemplated
by Section 4.2.
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4.2 DIVIDENDS AND OTHER DISTRIBUTIONS
No dividends or other distributions declared or made after the
Effective Time with respect to the Exchangeable Shares with a record date after
the Effective Time shall be paid to the holder of any formerly outstanding PTI
Common Shares which were not exchanged pursuant to Section 2.1, and no cash
payment in lieu of fractional shares shall be paid to any such holder pursuant
to Section 4.3 (and no interest will be earned and payable thereon), unless and
until the certificate representing such PTI Common Shares shall be surrendered
in accordance with Section 4.1. Subject to applicable law and to Section 4.8, at
the time of such surrender of any such certificate (or, in the case of clause
(c) below, at the appropriate payment date), there shall be paid to the holder
of the Exchangeable Shares resulting from such exchange, in all cases without
interest, (a) the amount of any cash payable in lieu of a fractional
Exchangeable Share to which such holder is entitled pursuant to Section 4.3, (b)
the amount of dividends or other distributions with a record date after the
Effective Time theretofore paid with respect to such Exchangeable Shares, and
(c) the amount of dividends or other distributions with a record date after the
Effective Time but prior to surrender and a payment date subsequent to surrender
payable with respect to such Exchangeable Shares.
4.3 NO FRACTIONAL SHARES
No certificates or scrip representing fractional Exchangeable Shares
shall be issued upon the surrender for exchange of certificates pursuant to
Section 4.1, and such fractional interests shall not entitle the owner thereof
to vote or to possess or exercise any rights as a security holder of PTI Holdco.
In lieu of any such fractional interests, each person entitled thereto will
receive an amount of cash (rounded to the nearest whole cent), without interest,
equal to the product of (a) such fractional interest, multiplied by (b) the OSI
IPO Price, such amount to be provided to the Depositary by PTI Holdco upon
request.
4.4 ISSUANCE OF CERTIFICATES REPRESENTING OSI COMMON STOCK
At or promptly after the Effective Time, OSI shall deposit with the
Depositary, for the benefit of the U.S. PTI Shareholders who ultimately
exchanged their PTI Common Shares for shares of OSI Common Stock pursuant to
Section 2.1(c) of the Arrangement, certificates representing the shares of OSI
Common Stock issued pursuant to the Arrangement upon the exchange. Upon
surrender to the Depositary of a certificate which immediately prior to the
Effective Time represented outstanding PTI Common Shares, and such additional
documents and instruments as the Depositary may reasonably require, the holder
of such surrendered certificate shall be entitled to receive in exchange
therefor, and the Depositary shall forthwith deliver to such holder, a
certificate representing that number (rounded down to the nearest whole number)
of shares of OSI Common Stock which such holder has the right to receive
pursuant to Section 2.1(c) of the Arrangement (together with any dividends or
distributions with respect thereto pursuant to Section 4.5 and any cash in lieu
of fractional Exchangeable Shares pursuant to Section 4.6), and any certificate
so surrendered shall forthwith be canceled. Until surrendered as contemplated by
this Section 4.4, each certificate held by a U.S. PTI Shareholder which
immediately prior to the Effective Time represented outstanding PTI Common
Shares shall be deemed at any time after the Effective Time, but subject to
Section 4.8, to represent only the right to receive upon such surrender (a) the
certificate representing shares of OSI Common Stock as contemplated by this
Section 4.4, (b) a cash payment in lieu of any fractional share of OSI Common
Stock
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as contemplated by Section 4.6 and (c) any dividends or distributions with a
record date after the Effective Time theretofore paid or payable with respect to
OSI Common Stock as contemplated by Section 4.5.
4.5 DIVIDENDS AND OTHER DISTRIBUTIONS
No dividends or other distributions declared or made after the
Effective Time with respect to the OSI Common Stock with a record date after the
Effective Time shall be paid to the U.S. PTI Shareholder of any formerly
outstanding PTI Common Shares which were not exchanged pursuant to Section 2.1,
and no cash payment in lieu of fractional shares shall be paid to any such
holder pursuant to Section 4.6 (and no interest will be earned and payable
thereon), unless and until the certificate representing such PTI Common Shares
shall be surrendered in accordance with Section 4.4. Subject to applicable law
and to Section 4.8, at the time of such surrender of any such certificate (or,
in the case of clause (c) below, at the appropriate payment date), there shall
be paid to the holder of the shares of OSI Common Stock resulting from such
exchange, in all cases without interest, (a) the amount of any cash payable in
lieu of a fractional share of OSI Common Stock to which such holder is entitled
pursuant to Section 4.6, (b) the amount of dividends or other distributions with
a record date after the Effective Time theretofore paid with respect to such OSI
Common Stock, and (c) the amount of dividends or other distributions with a
record date after the Effective Time but prior to surrender and a payment date
subsequent to surrender payable with respect to such OSI Common Stock.
4.6 NO FRACTIONAL SHARES
No certificates or scrip representing fractional shares of OSI Common
stock shall be issued upon the surrender for exchange of certificates pursuant
to Section 4.4, and such fractional interests shall not entitle the owner
thereof to vote or to possess or exercise any rights as a security holder of
OSI. In lieu of any such fractional interests, each U.S. PTI Shareholder
entitled thereto will receive an amount of cash (rounded to the nearest whole
cent), without interest, equal to the product of (a) such fractional interest,
multiplied by (b) the OSI IPO Price, such amount to be provided to the
Depositary by OSI upon request.
4.7 LOST CERTIFICATES
If any certificate which immediately prior to the Effective Time
represented outstanding PTI Common Shares which were exchanged pursuant to
Section 2.1 has been lost, stolen or destroyed, upon the making of an affidavit
of that fact by the person claiming such certificate to be lost, stolen or
destroyed, the Depositary will issue in exchange for such lost, stolen or
destroyed certificate, certificates representing Exchangeable Shares (together
with any dividends or distributions with respect thereto pursuant to Section 4.2
and any cash in lieu of a fractional Exchangeable Share pursuant to Section 4.3)
or, in the case of a U.S. PTI Shareholder, certificates representing shares of
OSI Common Stock (together with any dividends or distributions with respect
thereto pursuant to Section 4.5 and any cash in lieu of a fractional share of
OSI Common Stock pursuant to Section 4.6) deliverable in respect thereof as
determined in accordance with Section 2.1. When seeking such certificate and
payment in exchange for any lost, stolen or destroyed certificate, the person to
whom certificates
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representing Exchangeable Shares are to be issued shall, as a condition
precedent to the issuance thereof, give a bond satisfactory to PTI Holdco, OSI
and the Transfer Agent, as the case may be, in such sum as PTI Holdco or OSI may
direct or otherwise indemnify PTI Holdco, OSI and the Transfer Agent in a manner
satisfactory to PTI Holdco, OSI and the Transfer Agent against any claim that
may be made against PTI Holdco, OSI or the Transfer Agent with respect to the
certificate alleged to have been lost, stolen or destroyed.
4.8 EXTINGUISHMENT OF RIGHTS
Any certificate which immediately prior to the Effective Time
represented outstanding PTI Common Shares which were exchanged pursuant to
Section 2.1 and has not been deposited, with all other instruments required by
Section 4.1, on or prior to the sixth anniversary of the Effective Date shall
cease to represent a claim or interest of any kind or nature as a Shareholder or
a holder of Exchangeable Shares or shares of OSI Common Stock. On such date, (a)
the Exchangeable Shares (and any dividends or distributions with respect thereto
and any cash pursuant to Section 4.3) to which the former registered holder of
the certificate referred to in the preceding sentence (other than a U.S. PTI
Shareholder) was ultimately entitled (or, if the Automatic Redemption Date has
occurred, the resulting shares of OSI Common Stock) shall be deemed to have been
surrendered to PTI Holdco (or, in the event that the Automatic Redemption Date
has occurred, OSI), together with all entitlements to dividends, distributions,
cash and interest thereon held for such former registered holder, for no
consideration and such shares shall thereupon be canceled and the name of the
former registered holder shall be removed from the register of holders of such
shares; (b) the shares of OSI Common Stock (and any dividends or distributions
with respect thereto and any cash pursuant to Section 4.6) to which the former
U.S. PTI Shareholder referred to in the preceding sentence was ultimately
entitled shall be deemed to have been surrendered to OSI, together with all
entitlements to dividends, distributions, cash and interest thereon held for
such former U.S. PTI Shareholder for no consideration and such shares shall
thereupon be cancelled and the name of the former U.S. PTI Shareholder shall be
removed from the register of holders of such shares.
ARTICLE 5
AMENDMENT
5.1 PLAN OF ARRANGEMENT AMENDMENT
PTI reserves the right to amend, modify and/or supplement this Plan of
Arrangement from time to time at any time prior to the Effective Time provided
that any such amendment, modification or supplement must be contained in a
written document that is (a) agreed to by OSI and PTI Holdco, (b) filed with the
Court and, if made following the Meeting, approved by the Court and (c)
communicated to Shareholders and Optionholders in the manner required by the
Court (if so required).
Any amendment, modification or supplement to this Plan of Arrangement
may be proposed by PTI at any time prior to or at the Meeting (provided that OSI
and PTI Holdco shall have consented thereto) with or without any other prior
notice or communication, and if so proposed and accepted by the persons voting
at the Meeting (other than as may be required under the Interim Order), shall
become part of this Plan of Arrangement for all purposes.
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<PAGE> 14
Any amendment, modification or supplement to this Plan of Arrangement
which is approved by the Court following the Meeting shall be effective only (a)
if it is consented to by PTI, (b) if it is consented to by OSI and PTI Holdco
and (c) if required by the Court or applicable law, it is consented to by the
Shareholders, Optionholders or the holders of Exchangeable Shares, as the case
may be.
Notwithstanding the foregoing, this Plan of Arrangement may be amended
in the manner contemplated by Section 11.9(d) of the Combination Agreement prior
to, at or following the Meeting and prior to or following the approval of this
Plan of Arrangement by the Court without notice to or the consent or approval of
the Shareholders, Optionholders, holders of Exchangeable Shares, or the Court.
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<PAGE> 15
APPENDIX A
TO THE PLAN OF ARRANGEMENT
THIS AGREEMENT OF AMALGAMATION is made this o day of o, 2000
AMONG:
PTI GROUP INC., a corporation, amalgamated under the laws of
the Province of Alberta (herein called "PTI")
OF THE FIRST PART
- and -
o ALBERTA INC., a corporation incorporated under the laws of
the Province of Alberta (herein called "PTI Amalco")
OF THE SECOND PART.
RECITALS:
A. As part of an arrangement involving PTI, PTI Amalco and PTI Holdco Inc.
("PTI Holdco") (the "Arrangement") under Section 186 of the Business
Corporations Act (Alberta) being Chapter B-15 of the Statutes of
Alberta, 1981 (the "Act") pursuant to a Plan of Arrangement (the
"Plan") which was approved by an order of the Court of Queen's Bench of
Alberta on the o day of o, 2000, PTI and PTI Amalco (herein sometimes
referred to jointly as the "Amalgamating Corporations" and either one
of which may hereinafter be referred to as an "Amalgamating
Corporation"), each being a valid and subsisting corporation in good
standing under the Act, have agreed to amalgamate upon the terms and
conditions and in accordance with the mode of carrying the amalgamation
into effect, as set out in the Plan and in this Agreement;
B. PTI was amalgamated under the laws of Alberta the 8th day of January,
1997;
C. PTI is authorized to issue an unlimited number of common shares (the
"PTI Common Shares"), of which 7,798,900 PTI Common Shares are
presently issued and outstanding as fully paid and non-assessable
shares in the capital of PTI;
D. PTI Amalco was incorporated under the laws of the Province of Alberta
on the o day of o, 2000 and is a wholly owned subsidiary of PTI Holdco;
E. PTI Amalco is authorized to issue an unlimited number of Common Voting
Shares of which o Common Voting Shares are presently issued and
outstanding as fully paid and non-assessable shares in the capital of
PTI Amalco;
F. Each of the Amalgamating Corporations has made full disclosure to the
other of all their respective assets and liabilities.
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<PAGE> 16
NOW THEREFORE THIS AGREEMENT WITNESSETH that for and in consideration of the
mutual promises herein contained and other good and valuable consideration, the
parties agree each with the other as follows:
1. The Amalgamating Corporations shall amalgamate and continue as one
corporation (herein sometimes referred to as the "Amalgamated
Corporation") under the provisions of the Act upon the terms and
conditions, and in accordance with the mode of carrying the
amalgamation into effect, as hereinafter set out;
2. The name of the Amalgamated Corporation shall be "PTI Group Inc.";
3. The Registered Office of the Amalgamated Corporation shall be 2900,
10180 - 101 Street, Edmonton, Alberta, T5J 3V5;
4. The Amalgamated Corporation shall be authorized to issue an unlimited
number of Class A Common Shares, an unlimited number of Class B Common
Shares, an unlimited number of Class C Common Shares and an unlimited
number of Class D Common Shares of which o Class A Common Shares, o
Class B Common Shares, o Class C Common Shares and o Class D Common
Shares shall be issued and outstanding on the basis hereinafter set
out;
5. There shall be no restrictions on the business the Amalgamated
Corporation may carry on or on the powers of the Amalgamated
Corporation may exercise;
6. The right to transfer shares of the Amalgamated Corporation shall be
restricted in that no shares shall be transferred without the approval
of the Board of Directors;
7. The number of shareholders of the Amalgamated Corporation exclusive of
persons who are in its employment and exclusive of persons who, having
been formerly in the employment of the Amalgamated Corporation, were,
while in that employment, and have continued after the termination of
that employment to be shareholders of the Amalgamated Corporation, is
limited to not more than fifty, two or more persons who are the joint
registered owners of one or more shares being counted as one
shareholder;
8. Any invitation to the public to subscribe for any securities of the
Amalgamated Corporation shall be prohibited;
9. Upon the amalgamation of the Amalgamating Corporations and their
continuance as one corporation becoming effective:
(a) the Amalgamating Corporations' property shall continue to be
the property of the Amalgamated Corporation;
(b) the Amalgamated Corporation shall continue to be liable for
the Amalgamating Corporations' obligations;
(c) an existing cause of action, claim or liability to the
prosecution relating to one or both of the Amalgamating
Corporations shall be unaffected;
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<PAGE> 17
(d) a civil, criminal or administrative action or proceeding
pending by or against one or both of the Amalgamating
Corporations may be continued to be prosecuted by or against
the Amalgamated Corporation;
(e) a conviction against, or ruling, order or judgment in favour
of or against, one or both of the Amalgamating Corporations
may be enforced by or against the Amalgamated Corporation; and
(f) the Amalgamated Corporation's articles of amalgamation shall
be deemed to be its articles of incorporation and the
Amalgamated Corporation's certificate of amalgamation shall be
deemed to be its certificate of incorporation;
10. The names, occupations and places of residence of the first directors
and officers of the Amalgamated Corporation shall be:
<TABLE>
<CAPTION>
NAME AND OCCUPATION ADDRESS OFFICE HELD
------------------- ------- -----------
<S> <C> <C>
o o Director, President and Secretary
o o Director
</TABLE>
11. The foregoing first directors shall hold office until the first meeting
of shareholders of the Amalgamated Corporation, or until their
successors are elected or appointed. Subject to the provisions of the
Act and any unanimous shareholder agreement, the Board of Directors
shall manage the business and affairs of the Amalgamated Corporation;
12. The Articles of Amalgamation of the Amalgamated Corporation shall be
those attached hereto as Schedule "A";
13. Until repealed, amended, altered or added to, so far as applicable, the
by-laws of PTI at the time of the Amalgamation becomes effective shall
be the by-laws of the Amalgamated Corporation, a copy of which is
attached hereto as Schedule "B";
14. The manner of converting the authorized and issued capital of each of
the Amalgamating Corporations into that of the Amalgamated Corporation
shall be as follows:
(a) the Amalgamated Corporation shall issue to PTI Holdco one
Class A Common Share for each of its PTI Common Shares;
(b) the Amalgamated Corporation shall issue to PTI Holdco one
Class A Common Share for each of its common shares in the
capital of PTI Amalco;
(c) the Amalgamated Corporation shall issue to 812375 Alberta Ltd.
("812375") one Class B Common Share for each of its PTI Common
Shares;
(d) the Amalgamated Corporation shall issue to R.J.M. Equities
Inc. ("RJM") one Class C Common Share for each of its PTI
Common Shares;
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<PAGE> 18
(e) the Amalgamated Corporation shall issue to each of the holders
of PTI Common Shares, other than 812375, RJM and PTI Holdco
and holders of PTI Common Shares in respect of which rights of
dissent have been exercised pursuant to Article 3 of the Plan
and which have been cancelled pursuant to Section 2.1(a)
thereof, one Class D Common Share for each of their PTI Common
Shares;
15. The Arrangement has been considered and ratified by the holders of the
shares of the Amalgamating Corporations and of PTI at special meetings
called for this purpose or by resolutions in writing signed by all
shareholders entitled to vote on that resolution, as the case may be;
and
16. To the extent that there is any conflict or inconsistency between the
terms of this Agreement and the Plan the terms of the Plan shall
prevail and the terms of this Agreement shall be amended accordingly.
IN WITNESS WHEREOF the Parties hereto have executed this Agreement as
of the day and year first written above.
PTI GROUP INC.
Per:
-----------------------------------
o ALBERTA INC.
Per:
-----------------------------------
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<PAGE> 19
SCHEDULE "A"
ARTICLES OF AMALGAMATED CORPORATION
A. The Corporation is authorized to issue an unlimited number of Class A
Common Shares, Class B Common Shares, Class C Common Shares and Class D
Common Shares having attached thereto the following rights, privileges,
restrictions and conditions:
I. CLASS A COMMON SHARES
1.1 Dividends
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class A Common Shares,
holders of Class A Common Shares have a right to
receive dividends when declared by the Board of
Directors out of property of the Corporation legally
available therefor.
1.2 Liquidation
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class A Common Shares,
the holders of Class A Common Shares shall, upon any
liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, or
other distribution of the assets of the Corporation
for the purpose of winding-up its affairs, be
entitled to receive the remaining property and assets
of the Corporation pro rata with the Class B Common,
Class C Common and Class D Common Shares.
1.3 Voting
(i) The holders of the Class A Common Shares shall be
entitled to receive notice of and to attend all
meetings of shareholders (other than separate
meetings of other classes or series of shares), and
shall be entitled to one vote for each Class A Common
Share held.
II. CLASS B COMMON SHARES
1.1 Dividends
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class B Common Shares,
holders of Class B Common Shares have a right to
receive dividends when declared by the Board of
Directors out of property of the Corporation legally
available therefor.
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<PAGE> 20
1.2 Liquidation
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class B Common Shares,
the holders of Class B Common Shares shall, upon any
liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, or
other distribution of the assets of the Corporation
for the purpose of winding-up its affairs, be
entitled to receive the remaining property and assets
of the Corporation pro rata with the Class A Common,
Class C Common and Class D Common Shares.
1.3 Voting
(i) The holders of the Class B Common Shares shall be
entitled to receive notice of and to attend all
meetings of shareholders (other than separate
meetings of other classes or series of shares), and
shall be entitled to one vote for each Class B Common
Share held.
III. CLASS C COMMON SHARES
1.1 Dividends
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class C Common Shares,
holders of Class C Common Shares have a right to
receive dividends when declared by the Board of
Directors out of property of the Corporation legally
available therefor.
1.2 Liquidation
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class C Common Shares,
the holders of Class C Common Shares shall, upon any
liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, or
other distribution of the assets of the Corporation
for the purpose of winding-up its affairs, be
entitled to receive the remaining property and assets
of the Corporation pro rata with the Class A Common,
Class B Common and Class D Common Shares.
1.3 Voting
(i) The holders of the Class C Common Shares shall be
entitled to receive notice of and to attend all
meetings of shareholders (other than separate
meetings of other classes or series of shares), and
shall be entitled to one vote for each Class C Common
Share held.
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<PAGE> 21
IV. CLASS D COMMON SHARES
1.1 Dividends
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class D Common Shares,
holders of Class D Common Shares have a right to
receive dividends when declared by the Board of
Directors out of property of the Corporation legally
available therefor.
1.2 Liquidation
(i) Subject to the rights attaching to any other classes
of shares ranking prior to the Class D Common Shares,
the holders of Class D Common Shares shall, upon any
liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, or
other distribution of the assets of the Corporation
for the purpose of winding-up its affairs, be
entitled to receive the remaining property and assets
of the Corporation pro rata with the Class A Common,
Class B Common and Class C Common Shares.
1.3 Voting
(i) The holders of the Class D Common Shares shall be
entitled to receive notice of and to attend all
meetings of shareholders (other than separate
meetings of other classes or series of shares), and
shall be entitled to one vote for each Class D Common
Share held.
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<PAGE> 22
SCHEDULE "B"
BY-LAW NUMBER 1
A BY-LAW RELATING GENERALLY
TO THE TRANSACTION OF THE
BUSINESS AND AFFAIRS OF
PTI GROUP INC.
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<PAGE> 23
PART I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 DEFINITIONS
In the By-laws, unless the context otherwise requires:
(a) "Act" means the Business Corporations Act (Alberta), .as amended, and
all regulations under the Act in force from time to time;
(b) "appoint" includes elect and vice versa;
(c) "Articles" includes the original or restated articles of incorporation,
articles of amendment, articles of amalgamation, articles of
continuance, articles of reorganization, articles of arrangement,
articles of dissolution and articles of revival of the Corporation, and
any amendment to any of them;
(d) "Board" means the board of directors of the Corporation;
(e) "By-laws" means this by-law and all other by-laws of the Corporation
from time to time in force;
(f) "Corporation" means PTI Group Inc.;
(g) "Director" means an individual who is duly elected or appointed as a
director of the Corporation;
(h) "Indemnified Party" has the meaning set out in section 5.2 for purposes
of that section;
(i) "Officer" means any officer of the Corporation appointed by the Board;
and
(j) "Shareholder" means a shareholder of the Corporation.
SECTION 1.2 INTERPRETATION
In the By-laws, except if defined in section 1.1 or the context does not permit:
(a) words and expressions defined in the Act have the meaning given to them
in the Act;
(b) words importing the singular include the plural and vice versa;
(c) words importing gender include masculine, feminine and neuter genders;
and
(d) words importing persons include bodies corporate.
SECTION 1.3 HEADINGS
The headings used in the By-laws are inserted for convenience of reference only.
The headings are not to be considered or taken into account in construing the
terms of the By-laws nor are they to be deemed in any way to clarify, modify or
explain the effect of any term of the By-laws.
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<PAGE> 24
SECTION 1.4 BY-LAWS SUBJECT TO THE ACT, ETC.
The By-laws are subject to the Act, any unanimous shareholder agreement relating
to the Corporation and the Articles, in that order.
PART II
SHAREHOLDERS
SECTION 2.1 PLACE AND TIME OF MEETINGS
Meetings of Shareholders may be held at the place within Alberta and at the time
the Board determines. A meeting of Shareholders may be held outside Alberta if
all the Shareholders entitled to vote at that meeting agree to holding the
meeting outside Alberta. A Shareholder who attends a meeting of Shareholders
held outside Alberta is deemed to have agreed to holding the meeting outside
Alberta, except when the Shareholder attends the meeting for the express purpose
of objecting to the transaction of any business on the grounds that the meeting
is not lawfully held.
SECTION 2.2 CALLING OF MEETINGS
The Board must call an annual meeting of Shareholders not later than 15 months
after holding the last preceding annual meeting and may at any time call a
special meeting of Shareholders to be held at the place within Alberta and at
the time the Board determines.
SECTION 2.3 NOTICE OF MEETINGS
Notice of the time and place of a meeting of Shareholders must be sent not less
than 21 days and not more than 50 days before the meeting:
(a) to each Shareholder entitled to vote at the meeting;
(b) to each Director; and
(c) to the auditor of the Corporation.
SECTION 2.4 NOTICE TO JOINT SHAREHOLDERS
If two or more persons are registered as joint holders of any share, notice to
one of those persons is sufficient notice to all of them. A notice must be
addressed to all those joint holders and the address to be used by the
Corporation must be the address appearing in the securities register of the
Corporation in respect of that joint holding or the first address appearing if
there is more than one address.
SECTION 2.5 FAILURE TO GIVE NOTICE
The accidental failure to give notice of a meeting of Shareholders to any person
entitled to a notice or any error in a notice not affecting its substance does
not invalidate any action taken at the meeting to which the notice relates.
SECTION 2.6 WAIVER OF NOTICE
A Shareholder or any other person entitled to attend a meeting of Shareholders
may waive, in any manner, notice of a meeting of Shareholders. Attendance of a
Shareholder or other person at a
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<PAGE> 25
meeting of Shareholders is a waiver of notice of the meeting, except when the
Shareholder or other person attends the meeting for the express purpose of
objecting to the transaction of any business on the grounds that the meeting is
not lawfully called.
SECTION 2.7 NOTICE OF ADJOURNED MEETINGS
With the consent of the Shareholders present at a meeting of Shareholders, the
chairperson may adjourn that meeting to another fixed time and place. If a
meeting of Shareholders is adjourned by one or more adjournments for an
aggregate of less than 30 days, it is not necessary to give notice of the
adjourned meeting, other than by verbal announcement at the time of the
adjournment. 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 must be given as for the original meeting.
SECTION 2.8 PERSONS ENTITLED TO BE PRESENT
The only persons entitled to be present at a meeting of Shareholders are:
(a) the Shareholders entitled to vote at the meeting;
(b) any individual authorized by a resolution of the directors or governing
body of a body corporate or association which is a Shareholder entitled to
vote at the meeting;
(c) the Directors and Officers;
(d) the auditor of the Corporation; and
(e) any others who, although not entitled to vote, are entitled or required
under any provision of the Act, any unanimous shareholder agreement, the
Articles or the By-laws to be present at the meeting.
Any other person may be admitted only on the invitation of the chairperson of
the meeting or with the consent of the meeting.
SECTION 2.9 MEETING BY TELEPHONE
Any person described in paragraphs (a) through (e) of section 2.8 may
participate in a meeting of the Shareholders by means of telephone or other
communication facilities that permit all persons participating in the meeting to
hear each other. A Shareholder participating in a meeting by means of telephone
or other communication facilities is deemed to be present at the meeting.
SECTION 2.10 QUORUM
A quorum of Shareholders is present at a meeting of Shareholders if the holders
of a majority of the shares entitled to vote at the meeting are present in
person or represented by proxy.
SECTION 2.11 LOSS OF QUORUM
If a quorum is present at the opening of a meeting of Shareholders, the
Shareholders present may proceed with the business of the meeting, even if a
quorum is not present throughout the meeting.
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<PAGE> 26
SECTION 2.12 CHAIRPERSON
The chairperson of any meeting of Shareholders will be the first mentioned of
the following Officers (if appointed) present at the meeting: Chairman of the
Board, President, Senior Vice-President or any other Vice-President. If none of
the Chairman of the Board, President or Senior Vice-President is present at the
meeting, and if more than one Vice-President is present, the first
Vice-President to arrive will be chairperson of the meeting. If none of the
foregoing Officers is present, the Shareholders present and entitled to vote at
the meeting may choose a chairperson from among those individuals present.
SECTION 2.13 PROCEDURE AT MEETINGS
The chairperson of any meeting of Shareholders will conduct the proceedings at
the meeting in all respects. The chairperson's decision on any matter or thing
relating to procedure, including, without limiting the generality of the
foregoing, any question regarding the validity of any instrument of proxy, is
conclusive and binding upon the Shareholders.
SECTION 2.14 VOTING
Voting at a meeting of Shareholders must be by a show of hands of those present
in person or represented by proxy or by a verbal poll of those present by
telephone or other communication facilities. If a ballot is required by the
chairperson of the meeting or is demanded by a Shareholder or proxy entitled to
vote at the meeting, either before or on. the declaration of the result of a
vote by a show of hands or verbal poll, voting must be by ballot. A demand for a
ballot may be withdrawn at any time before the ballot is taken. If a ballot is
taken on a question, a prior vote on that question by show of hands or verbal
poll has no effect. At every meeting a Shareholder present in person or
represented by proxy or present by telephone or other communication facilities
and entitled to vote has one vote on a show of hands and, subject to the
Articles, one vote on a ballot for each share held.
SECTION 2.15 DECISION ON QUESTIONS
At every meeting of Shareholders all questions proposed for the consideration of
Shareholders must be decided by the majority of votes, unless otherwise required
by the Act or the Articles. In the case of an equality of votes, the chairperson
does not, either on a show of hands or verbal poll or on a ballot, have a
casting vote in addition to the vote or votes to which the chairperson may be
entitled as a Shareholder or proxy.
SECTION 2.16 RESOLUTION IN LIEU OF MEETING
A resolution in writing signed by all the Shareholders entitled to vote on that
resolution is as valid as if it had been passed at a meeting of the
Shareholders. A resolution in writing may be signed in one or more counterparts,
all of which together constitute the same resolution. A facsimile of a signed
counterpart of a resolution in writing is as valid as an originally signed
counterpart.
PART III
DIRECTORS
SECTION 3.1 NUMBER OF DIRECTORS
The Board consists of that number of Directors as the Shareholders may determine
from time to time by ordinary resolution, but there must not be less than the
minimum and not more than the maximum number of Directors permitted by the
Articles at any one time.
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<PAGE> 27
SECTION 3.2 ELECTION AND TERM OF OFFICE
At each annual meeting of Shareholders at which an election of Directors is
required, the Shareholders, by ordinary resolution, must elect Directors to hold
office for a term expiring not later than the close of the next annual meeting
of Shareholders following the election.
SECTION 3.3 CALLING OF MEETINGS
The Chairman of the Board, if any, the President or any Director may call a
meeting of Directors. A meeting of Directors may be held at any place within the
municipality in which the registered office of the Corporation is located or at
any other place determined by the Board.
SECTION 3.4 NOTICE OF MEETINGS
Notice in writing of the time and place of a meeting of Directors must be sent
to each Director not less than 48 hours before the time fixed for that meeting.
SECTION 3.5 FAILURE TO GIVE NOTICE
The accidental failure to give notice of a meeting of Directors to any Director
entitled to a notice or any error in a notice not affecting its substance does
not invalidate any action taken at the meeting to which the notice relates.
SECTION 3.6 WAIVER OF NOTICE
A Director may waive, in any manner, notice of a meeting of Directors.
Attendance of a Director at a meeting of Directors is a waiver of notice of the
meeting, except when the Director attends the meeting for the express purpose of
objecting to the transaction of any business on the grounds that the meeting is
not lawfully called.
SECTION 3.7 MEETINGS WITHOUT NOTICE
No notice of meeting need be given:
(a) to a newly elected Board following its election at an annual or special
meeting of Shareholders; or
(b) for a meeting of Directors at which a Director is appointed to fill a
vacancy in the Board,
if a quorum is present.
SECTION 3.8 MEETING BY TELEPHONE
If all the Directors consent, a Director may participate in a meeting of
Directors or of a committee of Directors by means of telephone or other
communication facilities that permit all persons participating in the meeting to
hear each other. A Director participating in a meeting by means of telephone or
other communication facilities is deemed to be present at the meeting.
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<PAGE> 28
SECTION 3.9 QUORUM
From time to time the Directors may fix the quorum for meetings of Directors or
of a committee of Directors, but unless so fixed, a majority of the Directors or
of a committee of Directors constitutes a quorum and, to the extent required by
the Act, no business may be transacted unless at least one-half of the Directors
present are resident Canadians.
SECTION 3.10 CHAIRPERSON OF MEETINGS
The chairperson of any meeting of Directors will be the first mentioned of the
following Officers (if appointed) who is a Director and is present at the
meeting: Chairman of the Board, President, Senior Vice-President or any other
Vice-President. If none of the Chairman of the Board, President or Senior
Vice-President is present at the meeting, and if more than one Vice-President is
present, the first Vice-President to arrive will be chairperson of the meeting.
If none of the foregoing Officers is present, the Directors present may choose
one of their number to be chairperson of the meeting.
SECTION 3.11 DECISION ON QUESTIONS
At every meeting of Directors all questions proposed for the consideration of
the Directors must be decided by the majority of votes. In the case of an
equality of votes, the chairperson does not have a casting vote.
SECTION 3.12 RESOLUTION IN LIEU OF MEETING
A resolution in writing signed by all the Directors entitled to vote on that
resolution at a meeting of Directors or committee of Directors is as valid as if
it had been passed at a meeting of Directors or committee of Directors. A
resolution in writing may be signed in one or more counterparts, all of which
together constitute the same resolution. A facsimile of a signed counterpart of
a resolution in writing is as valid as an originally signed counterpart.
SECTION 3.13 BORROWING POWER
Without authorization of the Shareholders, the Directors may authorize the
Corporation to:
(a) borrow money on the credit of the Corporation;
(b) issue, reissue, sell or pledge debt obligations of the Corporation;
(c) subject to section 42 of the Act, give a guarantee on behalf of the
Corporation to secure performance of an obligation of any person; and
(d) mortgage, hypothecate, pledge or otherwise create a security interest
in all or any property of the Corporation, owned or subsequently
acquired, to secure any obligation of the Corporation.
The Directors, by resolution, may delegate to a Director, a committee of
Directors or an Officer all or any of the powers conferred on them by this
section.
SECTION 3.14 COMPENSATION
The Corporation may pay to the Directors the remuneration fixed by the Board and
may reimburse the Directors in respect of transportation and other expenses
actually incurred in attending meetings of the Directors or in otherwise
performing the duties of their office.
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PART IV
OFFICERS
SECTION 4.1 APPOINTMENT OF OFFICERS
The Directors may designate offices of the Corporation and appoint individuals
to those offices as they consider advisable. No Officer need be a Director. The
same individual may hold two or more offices of the Corporation.
SECTION 4.2 TERM OF OFFICE
All Officers are subject to removal by the Directors, with or without cause. An
Officer may resign at any time by giving notice to the Board.
SECTION 4.3 DUTIES OF OFFICERS
Subject to any limitations imposed by the Act, any unanimous shareholder
agreement or the Articles, an Officer has all the powers and authority and must
perform all the duties usually incident to, or specified by the By-laws or the
Board for, the office held.
PART V
LIABILITY AND INDEMNIFICATION
SECTION 5.1 LIMITATION OF LIABILITY
Every Director and Officer in exercising the powers and discharging the duties
of office must act honestly and in good faith with a view to the best interests
of the Corporation and must exercise the care, diligence and skill that a
reasonably prudent person would exercise in comparable circumstances. No
Director or Officer is liable for:
(a) the acts, omissions or defaults of any other Director or Officer or an
employee of the Corporation,
(b) any loss, damage or expense incurred by the Corporation through the
insufficiency or deficiency of title to any property acquired for or on
behalf of the Corporation,
(c) the insufficiency or deficiency of any security in or upon which any of
the money of the Corporation is invested,
(d) any loss or damage arising from the bankruptcy, insolvency or tortious
or criminal acts of any person with whom any of the Corporation's money
is, or securities or other property are, deposited,
(e) any loss occasioned by any error of judgment or oversight, or
(f) any other loss, damage or misfortune which occurs in the execution of
the duties of office or in relation to it,
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unless occasioned by the wilful neglect or default of that Director or Officer.
Nothing in this By-law relieves any Director or Officer of any liability imposed
by the Act or otherwise by law.
SECTION 5.2 INDEMNITY
Subject to the Act, the Corporation indemnifies a Director or Officer, a former
Director or Officer and 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 (the "Indemnified Parties") and the heirs and legal
representatives of each of them, against all costs, charges and expenses, which
includes, without limiting the generality of the foregoing, the fees, charges
and disbursements of legal counsel on an
as-between-a-solicitor-and-his-own-client basis and an amount paid to settle an
action or satisfy a judgment, reasonably incurred by an Indemnified Party, or
the heirs or legal representatives of an Indemnified Party, or both, in respect
of any action or proceeding to which any of them is made a party by reason of an
Indemnified Party being or having been a director or officer of the Corporation
or that body corporate, if:
(a) the Indemnified Party 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, the Indemnified Party had reasonable
grounds for believing that the Indemnified Party's conduct was lawful.
The Corporation indemnifies an Indemnified Party and the heirs and legal
representatives of an Indemnified Party in any other circumstances that the Act
permits or requires. Nothing in this By-law limits the right of a person
entitled to indemnity to claim indemnity apart from the provisions of this
By-law.
SECTION 5.3 INSURANCE
The Corporation may purchase and maintain insurance for the benefit of a person
referred to in section 5.2 against the liabilities and in the amounts the Act
permits and the Board approves.
ENACTED by the board the _____ day of ______________, 2000.
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APPENDIX B
TO THE PLAN OF ARRANGEMENT
SHARE CAPITAL AND OTHER PROVISIONS
TO BE INCLUDED IN THE
RESTATED ARTICLES OF INCORPORATION OF PTI HOLDCO
A. SHARE CAPITAL
PROVISIONS ATTACHING TO THE COMMON SHARES
The common shares ("Common Shares") in the capital of the Corporation
shall have attached thereto the following rights, privileges, restrictions and
conditions:
DIVIDENDS
Subject to the prior rights of the Exchangeable Shares and any other
shares ranking prior to the Common Shares, holders of Common Shares have a right
to receive dividends when declared by the Board of Directors out of property of
the Corporation legally available therefor.
LIQUIDATION
Subject to the prior rights of the Exchangeable Shares and any other
shares ranking prior to the Common Shares, the holders of Common Shares shall,
upon any liquidation, dissolution or winding-up of the Corporation, whether
voluntary or involuntary, or other distribution of the assets of the Corporation
for the purpose of winding-up its affairs, be entitled to receive the remaining
property and assets of the Corporation.
VOTING
The holders of the Common Shares shall be entitled to receive notice of
and to attend all meetings of shareholders (other than separate meetings of
other classes or series of shares), and shall be entitled to one vote for each
Common Share held.
PROVISIONS ATTACHING TO THE EXCHANGEABLE SHARES
The Exchangeable Shares in the capital of the Corporation shall have
the following rights, privileges, restrictions and conditions:
ARTICLE 1
INTERPRETATION
1.1 For the purposes of these rights, privileges, restrictions and
conditions:
"Act" means the Business Corporations Act (Alberta), as amended,
consolidated or reenacted from time to time.
<PAGE> 32
"Aggregate Equivalent Vote Amount" means, with respect to any matter,
proposition or question on which holders of OSI Common Stock are entitled to
vote, consent or otherwise act, the product of (i) the number of Exchangeable
Shares then issued and outstanding and held by holders (other than OSI and its
Subsidiaries) multiplied by (ii) the number of votes to which a holder of one
share of OSI Common Stock is entitled with respect to such matter, proposition
or question.
"Automatic Redemption Date" means the date for the automatic redemption
by the Corporation of Exchangeable Shares pursuant to Article 7 of these share
provisions, which date shall be the first to occur of (a) the date, if any,
selected pursuant to this clause (a) by the Board of Directors of the
Corporation, such date to be no earlier than the fifth anniversary of the
Effective Date, (b) the date selected by the Board of Directors of the
Corporation (such date to be no earlier than the third or fourth anniversary of
the Effective Date of the Arrangement) at a time when less than 10% or 20%,
respectively, of the number of Exchangeable Shares issuable on the Effective
Date (other than Exchangeable Shares held by OSI and its Subsidiaries, and as
such number of shares may be adjusted as deemed appropriate by the Board of
Directors to give effect to any subdivision or consolidation of or stock
dividend on the Exchangeable Shares, any issuance or distribution of rights to
acquire Exchangeable Shares or securities exchangeable for or convertible into
or carrying rights to acquire Exchangeable Shares, any issue or distribution of
other securities or rights or evidences of indebtedness or assets, or any other
capital reorganization or other transaction involving or affecting the
Exchangeable Shares), are outstanding, (c) the date the Board of Directors of
the Corporation selects if an OSI Control Transaction occurs and the Board of
Directors determines, in good faith and in its sole discretion, that it is not
reasonable to substantially replicate the terms and conditions of the
Exchangeable Shares in connection with such OSI Control Transaction and that the
redemption of all but not less than all of the outstanding Exchangeable Shares
is commercially or legally necessary to enable the completion of such OSI
Control Transaction in accordance with its terms, (d) the Business Day following
the day on which the holders of Exchangeable Shares fail to pass, at any meeting
or vote, a resolution regarding any matter on which the holders of Exchangeable
Shares are entitled to vote as shareholders of the Corporation and which has
been proposed by the Board of Directors of the Corporation, provided that this
clause (d) shall not apply to any resolution to amend the Exchangeable Share
Provisions, the Support Agreement or the Voting and Exchange Trust Agreement, or
(e) the Business Day following the day on which the holders of Exchangeable
Shares fail to take the necessary action at a meeting or other vote of holders
of Exchangeable Shares, if and to the extent such action is required, to approve
or disapprove, as applicable, any change to, or in the rights of the holders of,
Exchangeable Shares, if the approval or disapproval, as applicable, of such
change would be required to maintain the economic and legal equivalence of the
Exchangeable Shares and the OSI Common Stock.
"Board of Directors" means the board of directors of the Corporation
and any committee thereof acting within its authority.
"Business Day" means any day other than a Saturday, a Sunday or a day
when banks are not open for business in either or both of Houston, Texas and
Edmonton, Alberta.
"Canadian Dollar Equivalent" means in respect of an amount expressed in
a foreign currency (the "Foreign Currency Amount") at any date the product
obtained by multiplying:
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(a) the Foreign Currency Amount by,
(b) the noon spot exchange rate on such date for such foreign
currency expressed in Canadian dollars as reported by the Bank
of Canada or, in the event such spot exchange rate is not
available, such spot exchange rate on such date for such
foreign currency expressed in Canadian dollars as may be
deemed by the Board of Directors to be appropriate for such
purpose.
"Combination Agreement" means the agreement so entitled dated as of
July o, 2000 by and among OSI, HWC Energy Services, Inc., Merger Sub-HWC, Inc.,
Sooner Inc., Merger Sub-Sooner, Inc. and PTI.
"Common Shares" means the common shares in the capital of the
Corporation.
"Current Market Price" means, in respect of a share of OSI Common Stock
on any date, the average of the closing price per share (computed and rounded to
the third decimal point) of shares of OSI Common Stock during the period of 20
consecutive trading days ending not more than five trading days before such date
on the New York Stock Exchange, or, if OSI Common Stock is not then traded on
the New York Stock Exchange, on such other principal U.S. stock exchange or
automated quotation system on which the OSI Common Stock is then listed or
quoted, as the case may be, as may be selected by the Board of Directors for
such purpose; provided, however, that if, in the opinion of the Board of
Directors the public distribution or trading activity of OSI Common Stock during
such period does not create a market which reflects the fair market value of a
share of OSI Common Stock, then the Current Market Price of a share of OSI
Common Stock shall be determined by the Board of Directors based upon the advice
of such qualified independent financial advisors as the Board of Directors may
deem to be appropriate, and provided further any such selection, opinion or
determination by the Board of Directors shall be conclusive and binding.
"Effective Date" has the meaning ascribed thereto in the Plan of
Arrangement.
"Exchangeable Share Consideration" means, with respect to each
Exchangeable Share, for any acquisition of or redemption of or distribution of
assets of the Corporation in respect of or purchase pursuant to these share
provisions, the Plan of Arrangement, the Support Agreement or the Voting and
Exchange Trust Agreement:
(a) the Current Market Price of one share of OSI Common Stock
deliverable in connection with such action;
(b) a cheque or cheques payable at par at any branch of the
bankers of the payor in the amount of all declared, payable
and unpaid, and all undeclared but payable, cash dividends
deliverable in connection with such action; and
(c) such stock or other property constituting any declared and
unpaid, and all undeclared but payable, non-cash dividends
deliverable in connection with such action,
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provided that (i) that part of the consideration which represents (a) above,
shall be fully paid and satisfied by the delivery of one share of OSI Common
Stock that is freely tradeable, such share to be duly issued as a fully paid and
non-assessable share, (ii) that part of the consideration which represents (c),
above, unpaid shall be fully paid and satisfied by delivery of such non-cash
items, and (iii) any such consideration shall be delivered free and clear of any
lien, claim, encumbrance, security interest or adverse claim or interest less
any tax required to be deducted and withheld therefrom and without interest.
"Exchangeable Share Price" means, for each Exchangeable Share, an
amount equal to the aggregate of:
(a) the Current Market Price of a share of OSI Common Stock; plus
(b) an additional amount equal to the full amount of all cash
dividends declared, payable and unpaid on such Exchangeable
Share; plus
(c) an additional amount equal to all dividends declared and
payable on OSI Common Stock which have not been declared on
Exchangeable Shares in accordance herewith; plus
(d) an additional amount representing non-cash dividends declared,
payable and unpaid on such Exchangeable Share.
"Exchangeable Shares" means the Exchangeable Shares of the Corporation
having the rights, privileges, restrictions and conditions set forth herein.
"freely tradeable", with respect to OSI Common Stock, means freely
transferable under Canadian provincial securities laws and U.S. federal and
state securities laws (pursuant to an effective resale shelf registration
statement or otherwise and assuming the reasonable cooperation of the holder or
recipient of OSI Common Stock in connection with any required resale shelf
registration statement), except to the extent restrictions arise by reason of a
person being a "control person" of OSI for the purposes of Canadian provincial
securities laws or an "affiliate" of OSI for the purposes of United States
federal or state securities laws, provided any trades in such securities are
conducted through the facilities of a stock exchange outside Canada.
"Liquidation Amount" has the meaning provided in Section 5.1.
"Liquidation Call Right" has the meaning provided in the Restated
Articles of Incorporation of the Corporation.
"Liquidation Call Purchase Price" has the meaning provided in the
Restated Articles of Incorporation of the Corporation.
"Liquidation Date" has the meaning provided in Section 5.1.
"OSI" means Oil States International, Inc., a corporation organized and
existing under the laws of the State of Delaware and includes any successor
corporation or any corporation in
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which the holders of OSI Common Stock hold securities resulting from the
application of Section 2.7 of the Support Agreement.
"OSI Call Notice" has the meaning provided in Section 6.3.
"OSI Common Stock" means the shares of common stock of OSI, with a par
value of U.S. $0.01 per share, having voting rights of one vote per share, and
any other securities resulting from the application of Section 2.7 of the
Support Agreement.
"OSI Control Transaction" means any merger or amalgamation involving
OSI, any tender offer for OSI, and any material sale of shares or rights or
interests therein or thereto by OSI or similar transactions, or any proposal to
do so, provided that upon completion of any such transaction the holders of OSI
Common Stock immediately before such transaction would hold, directly or
indirectly, less than 50% of the voting securities, or securities exchangeable
or exercisable for or convertible into voting securities, of the merged or
amalgamated corporation, the offeror or the purchaser, as the case may be.
"OSI Dividend Declaration Date" means the date on which the board of
directors of OSI declares any dividend on the OSI Common Stock.
"OSI Special Share" means the one share of Special Voting Stock of OSI,
with a par value of U.S. $0.0001, and having voting rights at meetings of
holders of OSI Common Stock equal to the Aggregate Equivalent Voting Amount.
"OSI ULC" has the meaning provided in the Voting and Exchange Trust
Agreement.
"PTI" means PTI Group Inc., a corporation organized and existing under
the Act.
"Plan of Arrangement" means the plan of arrangement involving and
affecting PTI and the holders of common shares and options, PTI Amalco and the
holders of its shares, the Corporation and the holders of its shares, OSI and
OSI ULC under section 186 of the Act contemplated in the Combination Agreement,
as further amended and restated from time to time.
"Purchase Price" has the meaning provided in Section 6.3.
"Redemption Call Purchase Price" has the meaning provided in the
Restated Articles of Incorporation of the Corporation.
"Redemption Call Right" has the meaning provided in the Restated
Articles of Incorporation of the Corporation.
"Redemption Price" has the meaning provided in Section 7.1.
"Retracted Shares" has the meaning provided in subsection 6.1 (a).
"Retraction Call Right" has the meaning provided in subsection 6.1 (c).
"Retraction Date" has the meaning provided in subsection 6.1 (b).
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"Retraction Price" has the meaning provided in Section 6. 1.
"Retraction Request" has the meaning provided in Section 6.1.
"Subsidiary", in relation to any person, means any body corporate,
partnership, joint venture, association or other entity of which more than 50%
of the total voting power of shares of stock or units of ownership or beneficial
interest entitled to vote in the election of directors (or members of a
comparable governing body) is owned or controlled, directly or indirectly, by
such person.
"Support Agreement" means the Support Agreement between OSI and the
Corporation, made as of the Effective Date.
"Transfer Agent" means the duly appointed transfer agent for the time
being of the Exchangeable Shares at its offices in each of Calgary, Alberta and
Toronto, Ontario.
"Trustee" means the Trustee appointed under the Voting and Exchange
Trust Agreement, and any successor trustee.
"Voting and Exchange Trust Agreement" means the Voting and Exchange
Trust Agreement among the Corporation, OSI and the Trustee, made as of the
Effective Date.
ARTICLE 2
RANKING OF EXCHANGEABLE SHARES
2.1 The Exchangeable Shares shall be entitled to a preference over the
Common Shares and any other shares ranking junior to the Exchangeable
Shares, with respect to the payment of dividends and the distribution
of assets in the event of the liquidation, dissolution or winding-up of
the Corporation, whether voluntary or involuntary, or any other
distribution of the assets of the Corporation among its shareholders
for the purpose of winding-up its affairs.
ARTICLE 3
DIVIDENDS
3.1 Subject to Section 3.2 below, a holder of an Exchangeable Share shall
be entitled to receive and the Board of Directors shall, subject to
applicable law, on each OSI Dividend Declaration Date, declare a
dividend on each Exchangeable Share:
(a) in the case of a cash dividend declared on the OSI Common
Stock, in an amount in cash for each Exchangeable Share in
U.S. dollars, or the Canadian Dollar Equivalent thereof on the
OSI Dividend Declaration Date, in each case corresponding to
the cash dividend declared on each share of OSI Common Stock;
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(b) in the case of a stock dividend declared on OSI Common Stock
to be paid in shares of OSI Common Stock, in such number of
Exchangeable Shares for each Exchangeable Share as is equal to
the number of shares of OSI Common Stock to be paid on each
share of OSI Common Stock; or
(c) in the case of a dividend declared on the OSI Common Stock in
property other than cash or OSI Common Stock, in such type and
amount of property for each Exchangeable Share as is the same
as or economically equivalent to (to be determined by the
Board of Directors as contemplated by Section 3.6 hereof) the
type and amount of property declared as a dividend on each
share of OSI Common Stock.
Such dividends shall be paid out of money, assets or property of the
Corporation properly applicable to the payment of dividends, or out of
authorized but unissued shares of the Corporation, as applicable.
3.2 In the case of a stock dividend declared on the OSI Common Stock to be
paid in shares of OSI Common Stock, in lieu of declaring the stock
dividend contemplated by Section 3.1(b) on the Exchangeable Shares, the
Board of Directors may, in its discretion and subject to applicable
law, subdivide, redivide or change (the "subdivision") each issued and
unissued Exchangeable Share on the basis that each Exchangeable Share
before the subdivision becomes a number of Exchangeable Shares as is
equal to the sum of (i) a share of OSI Common Stock and (ii) the number
of shares of OSI Common Stock to be paid as a stock dividend on each
share of OSI Common Stock. In such instance, and notwithstanding any
other provision hereof, such subdivision shall become effective on the
effective date specified in Section 3.4 hereof without any further act
or formality on the part of the Board of Directors or of the holders of
Exchangeable Shares. For greater certainty, no approval of the holders
of Exchangeable Shares to an amendment to the articles of the
Corporation shall be required to give effect to such subdivision.
3.3 Cheques of the Corporation payable at par at any branch of the bankers
of the Corporation shall be issued in respect of any cash dividends
contemplated by subsection 3.1 (a) hereof and the sending of such a
cheque to each holder of an Exchangeable Share (less any tax required
to be deducted and withheld from such dividends paid or credited by the
Corporation) shall satisfy the cash dividends represented thereby
unless the cheque is not paid on presentation. Certificates registered
in the name of the registered holder of Exchangeable Shares shall be
issued or transferred in respect of any stock dividends contemplated by
subsections 3.1 (b) or (d) hereof and the sending of such a certificate
to each holder of an Exchangeable Share shall satisfy the stock
dividend represented thereby or dividend payable in other securities
represented thereby. Such other type and amount of property in respect
of any dividends contemplated by subsection 3.1 (c) hereof shall be
issued, distributed or transferred by the Corporation in such manner as
it shall determine and the issuance, distribution or transfer thereof
by the Corporation to each holder of an Exchangeable Share shall
satisfy the dividend represented thereby. In all cases, any such
dividends shall be subject to any reduction or adjustment for tax
required to be deducted and withheld from such dividends, and the
Corporation shall be entitled to liquidate some of the property which
would otherwise be deliverable in payment of such dividends to a
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particular holder of Exchangeable Shares to fund any statutory
withholding obligation. No holder of an Exchangeable Share shall be
entitled to recover by action or other legal process against the
Corporation any dividend which is represented by a cheque that has not
been duly presented to the Corporation's bankers for payment or which
otherwise remains unclaimed for a period of six years from the date on
which such dividend was payable.
3.4 The record date for the determination of the holders of Exchangeable
Shares entitled to receive payment of, and the payment date for, any
dividend declared on the Exchangeable Shares under Section 3.1 hereof
shall be the same dates as the record date and payment date,
respectively, for the corresponding dividend declared on the OSI Common
Stock. The record date for the determination of the holders of
Exchangeable Shares entitled to receive Exchangeable Shares in
connection with any subdivision of Exchangeable Shares under Section
3.2 hereof and the effective date of such subdivision shall be the same
dates as the record date and payment date, respectively, for the
corresponding stock dividend declared on the OSI Common Stock.
3.5 If on any payment date for any dividends declared on the Exchangeable
Shares under Section 3.1 hereof the dividends are not paid in full on
all of the Exchangeable Shares then outstanding, any such dividends
which remain unpaid shall be paid on a subsequent date or dates
determined by the Board of Directors on which the Corporation shall
have sufficient moneys, assets or property properly applicable to the
payment of such dividends.
3.6 The Board of Directors shall determine, in good faith and in its sole
discretion, economic equivalence for the purposes of Sections 3.1 and
3.2 hereof, and each such determination shall be conclusive and binding
on the Corporation and its shareholders. In making each such
determination, the following factors shall, without excluding other
factors determined by the Board of Directors to be relevant, be
considered by the Board of Directors:
(a) in the case of any stock dividend or other distribution
payable in shares of OSI Common Stock, the number of such
shares issued in proportion to the number of shares of OSI
Common Stock previously outstanding;
(b) in the case of the issuance or distribution of any rights,
options or warrants to subscribe for or purchase shares of OSI
Common Stock (or securities exchangeable for or convertible
into or carrying rights to acquire shares of OSI Common
Stock), the relationship between the exercise price of each
such right, option or warrant and the Current Market Price of
a share of OSI Common Stock;
(c) in the case of the issuance or distribution of any other form
of property (including without limitation any shares or
securities of OSI of any class other than OSI Common Stock,
any rights, options or warrants other than those referred to
in Section 3.6(b) above, any evidences of indebtedness of OSI
or any assets of OSI), the relationship between the fair
market value (as determined by the Board of Directors in the
manner above contemplated) of such property to be issued or
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distributed with respect to each outstanding share of OSI
Common Stock and the Current Market Price of a share of OSI
Common Stock; and
(d) in all such cases, the general taxation consequences of the
relevant event to holders of Exchangeable Shares to the extent
that such consequences may differ from the taxation
consequences to holders of OSI Common Stock as a result of
differences between taxation laws of Canada and the United
States (except for any differing consequences arising as a
result of differing marginal taxation rates and without regard
to the individual circumstances of holders of Exchangeable
Shares).
3.7 Except as provided in this Article 3, the holders of Exchangeable
Shares shall not be entitled to receive dividends in respect thereof.
ARTICLE 4
CERTAIN RESTRICTIONS
4.1 So long as any of the Exchangeable Shares are outstanding, the
Corporation shall not at any time without, but may at any time with,
the approval of the holders of the Exchangeable Shares given as
specified in Article 9 of these share provisions:
(a) pay any dividends on the Common Shares, or any other shares
ranking junior to the Exchangeable Shares, other than stock
dividends payable in any such other shares ranking junior to
the Exchangeable Shares;
(b) redeem or purchase or make any capital distribution in respect
of Common Shares or any other shares ranking junior to the
Exchangeable Shares with respect to the payment of dividends
or on any liquidation distribution;
(c) redeem or purchase any other shares of the Corporation ranking
equally with the Exchangeable Shares with respect of the
payment of dividends or on any liquidation distribution;
(d) issue any Exchangeable Shares other than by way of stock
dividends to holders of Exchangeable Shares or as contemplated
by the Support Agreement; or
(e) amend the articles or by-laws of the Corporation, in either
case in any manner that would affect the rights or privileges
of the holders of the Exchangeable Shares.
The restrictions in subsections 4.1(a), 4.1(b) and 4.1(c) above shall
not apply if all dividends on the outstanding Exchangeable Shares corresponding
to dividends declared with a record date on or following the effective date of
the Plan of Arrangement on the OSI Common Stock shall have been declared on the
Exchangeable Shares and paid in full. Nothing herein shall be interpreted to
restrict the Corporation from issuing additional Common Shares to OSI or any
Subsidiary of OSI.
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ARTICLE 5
DISTRIBUTION ON LIQUIDATION
5.1 In the event of the liquidation, dissolution or winding-up of the
Corporation or any other distribution of the assets of the Corporation
among its shareholders for the purpose of winding-up its affairs,
provided that neither OSI nor OSI ULC shall have exercised the
Liquidation Call Right, a holder of Exchangeable Shares shall be
entitled, subject to applicable law, to receive from the assets of the
Corporation in respect of each Exchangeable Share held by such holder
on the effective date of such liquidation, dissolution or winding-up
(the "Liquidation Date"), before any distribution of any part of the
assets of the Corporation to the holders of the Common Shares or any
other shares ranking junior to the Exchangeable Shares, an amount equal
to the Exchangeable Share Price applicable on the last Business Day
prior to the Liquidation Date (the "Liquidation Amount") in accordance
with Section 5.2. In connection with payment of the Liquidation Amount,
the Corporation shall be entitled to liquidate some of the OSI Common
Stock which would otherwise be deliverable as Exchangeable Share
Consideration to the particular holder of Exchangeable Shares in order
to fund any statutory withholding tax obligation.
5.2 Within three Business Days after the Liquidation Date, and subject to
the exercise by OSI or OSI ULC of the Liquidation Call Right, the
Corporation shall cause to be delivered to the holders of the
Exchangeable Shares the Liquidation Amount for each such Exchangeable
Share upon presentation and surrender of the certificates representing
such Exchangeable Shares, together with such other documents and
instruments as may be required to effect a transfer of Exchangeable
Shares under applicable law and the by-laws of the Corporation and such
additional documents and instruments as the Transfer Agent may
reasonably require, at the registered office of the Corporation or at
any office of the Transfer Agent as may be specified by the Corporation
in Schedule A hereto or by notice to the holders of the Exchangeable
Shares (provided that such presentation and surrender shall be valid if
made at the office of the Transfer Agent, if any, in the province in
which such holder is listed on the books of the Corporation). Payment
of the total Liquidation Amount for such Exchangeable Shares shall be
made by delivery to each holder, at the address of the holder recorded
in the securities register of the Corporation for the Exchangeable
Shares or by holding for pick up by the holder at the registered office
of the Corporation or at any office of the Transfer Agent as may be
specified by the Corporation in Schedule A hereto or by notice to the
holders of Exchangeable Shares (provided that such delivery shall be
made to the holder at its address recorded in the securities register
of the Corporation or at the office of the transfer agent, if any, in
the province in which the address of the holder recorded in the
securities register of the Corporation is located), on behalf of the
Corporation of the Exchangeable Share Consideration representing the
total Liquidation Amount. On and after the Liquidation Date, the
holders of the Exchangeable Shares shall cease to be holders of such
Exchangeable Shares and shall not be entitled to exercise any of the
rights of holders in respect thereof, other than the right to receive
their proportionate part of the total Liquidation Amount, unless
payment of the total Liquidation Amount for such Exchangeable Shares
shall not be made upon presentation and surrender of share certificates
in accordance with the foregoing provisions, in which case the rights
of the
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holders shall remain unaffected until the total Liquidation Amount has
been paid in the manner hereinbefore provided. The Corporation shall
have the right at any time on or after the Liquidation Date to deposit
or cause to be deposited the Exchangeable Share Consideration in
respect of the Exchangeable Shares represented by certificates that
have not at the Liquidation Date been surrendered by the holders
thereof in a custodial account or for safe keeping, in the case of
non-cash items, with any chartered bank or trust company in Canada.
Upon such deposit being made, the of Exchangeable Shares after such
deposit shall be limited to receiving their proportionate part of the
total Liquidation Amount for such Exchangeable Shares so deposited,
against presentation and surrender of the said certificates held by
them, respectively, in accordance with the foregoing provisions. Upon
such payment or deposit of such Exchangeable Share Consideration, the
holders of the Exchangeable Shares shall thereafter be considered and
deemed for all purposes to be the holders of the OSI Common Stock
delivered to them. Notwithstanding the foregoing, until such payment or
deposit of such Exchangeable Share Consideration, the holder shall be
deemed to still be a holder of Exchangeable Shares for purposes of all
voting rights with respect thereto under the Voting and Exchange Trust
Agreement.
5.3 After the Corporation has satisfied its obligations to pay the holders
of the Exchangeable Shares the Liquidation Amount per Exchangeable
Share, such holders shall not be entitled to share in any further
distribution of the assets of the Corporation.
5.4 If OSI or OSI ULC exercises the Liquidation Call Right, each holder of
Exchangeable Shares shall be obligated to sell the Exchangeable Shares
held by such holder to OSI or OSI ULC, as the case may be, on the
Liquidation Date on payment to such holder by OSI or OSI ULC, as the
case may be, of the Exchangeable Share Consideration representing the
Liquidation Call Purchase Price for each Exchangeable Share.
ARTICLE 6
RETRACTION OF EXCHANGEABLE SHARES BY HOLDER
6.1 A holder of Exchangeable Shares shall be entitled at any time after the
effectiveness of a Registration Statement under the Securities Act of
1933 registering the issuance of shares of OSI Common Stock issuable
pursuant to the provisions attaching to the Exchangeable Shares or
prior thereto with the written consent of the Corporation, subject to
applicable law and the exercise by OSI or OSI ULC of the Retraction
Call Right (which, if exercised by OSI or OSI ULC, shall be binding on
the holder of Exchangeable Shares) and otherwise upon compliance with
the provisions of this Article 6, to require the Corporation to redeem
any or all of the Exchangeable Shares registered in the name of such
holder for an amount equal to the Exchangeable Share Price applicable
on the last Business Day prior to the Retraction Date (the "Retraction
Price") which as set forth in Section 6.4, shall be fully paid and
satisfied by the delivery by or on behalf of the Corporation of the
Exchangeable Share Consideration representing such holder's Retraction
Price. In connection with payment of the Retraction Price, the
Corporation shall be entitled to liquidate some of the OSI Common Stock
that would otherwise be deliverable as Exchangeable Share Consideration
to the particular holder of
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Exchangeable Shares in order to fund any statutory withholding tax
obligation. To effect such redemption, the holder shall present and
surrender at the registered office of the Corporation or at any office
of the Transfer Agent as may be specified by the Corporation in
Schedule A hereto or by notice to the holders of Exchangeable Shares
the certificate or certificates representing the Exchangeable Shares
which the holder desires to have the Corporation redeem, together with
such other documents and instruments as may be required to effect a
transfer of Exchangeable Shares under applicable law and the by-laws of
the Corporation and such additional documents and instruments as the
Transfer Agent may reasonably require, and together with a duly
executed statement (the "Retraction Request") in the form of Schedule
"A" hereto or in such other form as may be acceptable to the
Corporation:
(a) specifying that the holder desires to have all or any number
specified therein of the Exchangeable Shares represented by
such certificate or certificates (the "Retracted Shares")
redeemed by the Corporation;
(b) stating the Business Day on which the holder desires to have
the Corporation redeem the Retracted Shares (the "Retraction
Date"), provided that the Retraction Date shall be not less
than three Business Days nor more than 10 Business Days after
the date on which the Retraction Request is received by the
Corporation and further provided that, in the event that no
such Business Day is specified by the holder in the Retraction
Request, the Retraction Date shall be deemed to be the tenth
Business Day after the date on which the Retraction Request is
received by the Corporation; and
(c) acknowledging the overriding right (the "Retraction Call
Right") of OSI or OSI ULC to purchase all but not less than
all the Retracted Shares directly from the holder and that the
Retraction Request shall be deemed to be a revocable offer by
the holder to sell the Retracted Shares in accordance with the
Retraction Call Right on the terms and conditions set out in
Section 6.3 below.
6.2 Subject to the exercise by OSI or OSI ULC of the Retraction Call Right,
upon receipt by the Corporation or the Transfer Agent in the manner
specified in Section 6.1 hereof of a certificate or certificates
representing the number of Exchangeable Shares which the holder desires
to have the Corporation redeem, together with a Retraction Request, and
provided that the Retraction Request is not revoked by the holder in
the manner specified in Section 6.7, the Corporation shall redeem the
Retracted Shares effective at the close of business on the Retraction
Date and shall cause to be delivered to such holder the total
Retraction Price with respect to such shares in accordance with Section
6.4 hereof. If only a part of the Exchangeable Shares represented by
any certificate are redeemed or purchased by OSI or OSI ULC pursuant to
the Retraction Call Right, a new certificate for the balance of such
Exchangeable Shares shall be issued to the holder at the expense of the
Corporation.
6.3 Upon receipt by the Corporation of a Retraction Request, the
Corporation shall immediately notify OSI and OSI ULC thereof. In order
to exercise the Retraction Call Right, OSI or OSI ULC must notify the
Corporation in writing of its determination to do
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so (the "OSI Call Notice") within two Business Days of such
notification. If OSI or OSI ULC does not so notify the Corporation
within such two Business Days, the Corporation will notify the holder
as soon as possible thereafter that neither OSI nor OSI ULC will
exercise the Retraction Call Right. If OSI or OSI ULC delivers the OSI
Call Notice within such two Business Days, and provided that the
Retraction Request is not revoked by the holder in the manner specified
in Section 6.7 hereof, the Retraction Request shall thereupon be
considered only to be an offer by the holder to sell the Retracted
Shares to OSI or OSI ULC, as the case may be, in accordance with the
Retraction Call Right. In such event, the Corporation shall not redeem
the Retracted Shares and OSI or OSI ULC, as the case may be, shall
purchase from such holder and such holder shall sell to OSI or OSI ULC,
as the case may be, on the Retraction Date the Retracted Shares for a
purchase price per share (the "Purchase Price") equal to the Retraction
Price, which as set forth in Section 6.4 hereof, shall be fully paid
and satisfied by the delivery by or on behalf of OSI or OSI ULC, as the
case may be, of the Exchangeable Share Consideration representing such
holder's Purchase Price. For the purposes of completing a purchase
pursuant to the Retraction Call Right, OSI or OSI ULC, as the case may
be, shall deposit with the Transfer Agent, on or before the Retraction
Date, the Exchangeable Share Consideration representing the total
Purchase Price. Provided that such Exchangeable Share Consideration has
been so deposited with the Transfer Agent, the closing of the purchase
and sale of the Retracted Shares pursuant to the Retraction Call Right
shall be deemed to have occurred as at the close of business on the
Retraction Date and, for greater certainty, no redemption by the
Corporation of such Retracted Shares shall take place on the Retraction
Date. In the event that OSI or OSI ULC, as the case may be, does not
deliver a OSI Call Notice within two Business Days or otherwise comply
with these Exchangeable Share provisions in respect thereto, and
provided that Retraction Request is not revoked by the holder in the
manner specified in Section 6.7 hereof, the Corporation shall redeem
the Retracted Shares on the Retraction Date and in the manner otherwise
contemplated in this Article 6.
6.4 Subject to receipt by the Corporation of the Retracted Shares, OSI or
OSI ULC, as the case may be, the Corporation, OSI or OSI ULC, as the
case may be, shall deliver or cause the Transfer Agent to deliver to
the relevant holder, at the address of the holder recorded in the
securities register of the Corporation for the Exchangeable Shares or
at the address specified in the holder's Retraction Request or by
holding for pick up by the holder at the registered office of the
Corporation or at any office of the Transfer Agent as may be specified
by the holder in Schedule A hereto, in each case on or before two
Business Days after the Retraction Date, the Exchangeable Share
Consideration representing the total Retraction Price or the total
Purchase Price, as the case may be, and such delivery of such
Exchangeable Share Consideration to the Transfer Agent shall be deemed
to be payment of and shall satisfy and discharge all liability for the
total Retraction Price or total Purchase Price, as the case may be,
except as to any cheque included therein which is not paid on due
presentation.
6.5 On and after the close of business on the Retraction Date, the holder
of the Retracted Shares shall cease to be a holder of such Retracted
Shares and shall not be entitled to exercise any of the rights of a
holder in respect thereof, other than the right to receive such
holder's proportionate part of the total Retraction Price or total
Purchase Price, as
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the case may be, unless upon presentation and surrender of certificates
in accordance with the foregoing provisions, payment of the total
Retraction Price or the total Purchase Price, as the case may be, shall
not be made, in which case the rights of such holder shall remain
unaffected until the Exchangeable Share Consideration representing the
total Retraction Price or the total Purchase Price, as the case may be,
has been paid in the manner hereinbefore provided. On and after the
close of business on the Retraction Date, provided that presentation
and surrender of certificates and payment of the Exchangeable Share
Consideration representing the total Retraction Price or the total
Purchase Price, as the case may be, has been made in accordance with
the foregoing provisions, the holder of the Retracted Shares so
redeemed by the Corporation or purchased by OSI or OSI ULC shall
thereafter be considered and deemed for all purposes to be a holder of
the OSI Common Stock delivered to it. Notwithstanding the foregoing,
until such payment of such Exchangeable Share Consideration to the
holder, the holder shall be deemed to still be a holder of Exchangeable
Shares for purposes of all voting rights with respect thereto under the
Voting and Exchange Trust Agreement.
6.6 Notwithstanding any other provision of this Article 6, the Corporation
shall not be obligated to redeem Retracted Shares specified by a holder
in a Retraction Request to the extent that such redemption of Retracted
Shares would be contrary to liquidity or solvency requirements or other
provisions of applicable law. If the Corporation believes that on any
Retraction Date it would not be permitted by any of such provisions to
redeem the Retracted Shares tendered for redemption on such date, and
provided that neither OSI nor OSI ULC shall have exercised the
Retraction Call Right with respect to the Retracted Shares, the
Corporation shall only be obligated to redeem Retracted Shares
specified by a holder in a Retraction Request to the extent of the
maximum number that may be so redeemed (rounded down to a whole number
of shares) as would not be contrary to such provisions and shall notify
the holder as soon as is reasonably practical but in any event not
later than one Business Day prior to the Retraction Date as to the
number of Retracted Shares which will not be redeemed by the
Corporation. In any case in which the redemption by the Corporation of
Retracted Shares would be contrary to liquidity or solvency
requirements or other provisions of applicable law, the Corporation
shall redeem Retracted Shares in accordance with Section 6.2 of these
share provisions on a pro rata basis and shall issue to each holder of
Retracted Shares a new certificate, at the expense of the Corporation,
representing the Retracted Shares not redeemed by the Corporation
pursuant to Section 6.2 hereof. Provided that the Retraction Request is
not revoked by the holder in the manner specified in Section 6.7
hereof, the holder of any such Retracted Shares not redeemed by the
Corporation pursuant to Section 6.2 hereof as a result of liquidity or
solvency requirements or applicable law shall be deemed by giving the
Retraction Request to require OSI or OSI ULC, as the case may be, to
purchase such Retracted Shares from such holder on the Retraction Date
or as soon as practicable thereafter on payment by OSI or OSI ULC, as
the case may be, to such holder of the Purchase Price for each such
Retracted Share, all as more specifically provided in the Voting and
Exchange Trust Agreement, and OSI or OSI ULC shall make such purchase.
6.7 A holder of Retracted Shares may, by notice in writing given by the
holder to the Corporation before the close of business on the Business
Day immediately preceding the Retraction Date, withdraw its Retraction
Request in which event such Retraction Request
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shall be null and void and, for greater certainty, the revocable offer
constituted by the Retraction Request to sell the Retracted Shares to
OSI or OSI ULC, as the case may be, shall be deemed to have been
revoked.
ARTICLE 7
REDEMPTION OF EXCHANGEABLE SHARES BY THE CORPORATION
7.1 Subject to applicable law, and if neither OSI or OSI ULC exercises the
Redemption Call Right (which, if exercised, shall be binding on the
holders of Exchangeable Shares), the Corporation shall on the Automatic
Redemption Date redeem the whole of the then outstanding Exchangeable
Shares for an amount equal to the Exchangeable Share Price applicable
on the last Business Day prior to the Automatic Redemption Date (the
"Redemption Price") which, as set forth in Section 7.3 hereof, shall be
fully paid and satisfied by the delivery by or on behalf of the
Corporation of the Exchangeable Share Consideration representing the
total Redemption Price. In connection with payment of the Exchangeable
Share Consideration representing the Redemption Price, the Corporation
shall be entitled to liquidate some of the OSI Common Stock which would
otherwise be deliverable as Exchangeable Share Consideration to the
particular holder of Exchangeable Shares in order to fund any statutory
withholding tax obligation.
7.2 In any case of a redemption of Exchangeable Shares under this Article
7, the Corporation, or the Transfer Agent on behalf of the Corporation,
shall, at least 60 days before an Automatic Redemption Date described
in clause (a) or (b) of the definition of Automatic Redemption Date or
at least such number of days before an Automatic Redemption Date
described in clause (c), (d) or (e) of the definition of Automatic
Redemption Date as the Board of Directors of the Corporation may
determine to be reasonably practicable in the circumstances, send or
cause to be sent to each registered holder of Exchangeable Shares a
notice in writing of the redemption or possible redemption by the
Corporation or the purchase by OSI or OSI ULC under the Redemption Call
Right, as the case may be, of the Exchangeable Shares held by such
holder. Such notice shall set out the Redemption Price or the
Redemption Call Purchase Price, as the case may be, the Automatic
Redemption Date and, if applicable, particulars of the Redemption Call
Right. In the case of any notice given in connection with a possible
Automatic Redemption Date as described in clause (c), (d) or (e) of the
definition of Automatic Redemption Date, such notice will be given
contingently and will be withdrawn if the contingency does not occur.
7.3 On or after the Automatic Redemption Date, and subject to the exercise
by OSI or OSI ULC of the Redemption Call Right, the Corporation shall
cause to be delivered to the holders of the Exchangeable Shares to be
redeemed the Exchangeable Share Consideration representing the
Redemption Price for each such Exchangeable Share upon presentation and
surrender at the registered office of the Corporation or at any office
of the Transfer Agent as may be specified by the Corporation in such
notice of the certificates representing such Exchangeable Shares,
together with such other documents and instruments as may be required
to effect a transfer of Exchangeable Shares under applicable law and
the by-laws of the Corporation and such additional documents and
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instruments as the Transfer Agent may reasonably require (provided that
such presentation and surrender shall be deemed to be valid if made at
the office of the Transfer Agent, if any, in the province in which the
address of the holder of Exchangeable Shares is recorded on the books
of the Corporation). Payment of the total Redemption Price for such
Exchangeable Shares shall be made by delivery to each holder, at the
address of the holder recorded in the securities register or at any
office of the Transfer Agent as may be specified by the Corporation in
such notice, on behalf of the Corporation, of the Exchangeable Share
Consideration representing the total Redemption Price (provided that if
payment is made by delivery of the Exchangeable share Consideration to
the Transfer Agent, such delivery shall be made at the office of the
Transfer Agent, if any, in the province in which the address of the
holder of Exchangeable Shares is recorded on the books of the
Corporation). On and after the Automatic Redemption Date, the holders
of the Exchangeable Shares called for redemption shall cease to be
holders of such Exchangeable Shares and shall not be entitled to
exercise any of the rights of holders in respect thereof, other than
the right to receive their proportionate part of the Exchangeable Share
Consideration representing the total Redemption Price, unless payment
of the Exchangeable Share Consideration representing the total
Redemption Price for such Exchangeable Shares shall not be made upon
presentation and surrender of certificates in accordance with the
foregoing provisions, in which case the rights of the holders shall
remain unaffected until the Exchangeable Share Consideration
representing the total Redemption Price has been paid in the manner
hereinbefore provided. The Corporation shall have the right at any time
after the sending of notice of its intention to redeem the Exchangeable
Shares as aforesaid to deposit or cause to be deposited the
Exchangeable Share Consideration with respect to the Exchangeable
Shares so called for redemption, or of such of the said Exchangeable
Shares represented by certificates that have not at the date of such
deposit been surrendered by the holders thereof in connection with such
redemption, in a custodial account or for safe keeping, in the case of
non-cash items, with any chartered bank or trust company in Canada
named in such notice. Upon the later of such deposit being made and the
Automatic Redemption Date, the Exchangeable Shares in respect whereof
such deposit shall have been made shall be redeemed and the rights of
the holders thereof after such deposit or Automatic Redemption Date, as
the case may be, shall be limited to receiving their proportionate part
of the Exchangeable Share Consideration representing the total
Redemption Price for such Exchangeable Shares so deposited, against
presentation and surrender of the said certificates held by them,
respectively, in accordance with the foregoing provisions. Upon such
payment or deposit of such Exchangeable Share Consideration, the
holders of the Exchangeable Shares shall thereafter be considered and
deemed for all purposes to be holders of the OSI Common Stock delivered
to them. Notwithstanding the foregoing, until such payment or deposit
of such Exchangeable Share Consideration is made, the holder shall be
deemed to still be a holder of Exchangeable Shares for purposes of all
voting rights with respect thereto under the Voting and Exchange Trust
Agreement.
7.4 If OSI or OSI ULC exercises the Redemption Call Right, each holder of
Exchangeable Shares shall be obligated to sell all the Exchangeable
Shares held by such holder to OSI or OSI ULC, as the case may be, on
the Automatic Redemption Date against payment to
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such holder by OSI or OSI ULC of the Exchangeable Share Consideration
representing the Redemption Call Purchase Price for each such share.
ARTICLE 8
VOTING RIGHTS
8.1 Except as required by applicable law and the provisions hereof, the
holders of the Exchangeable Shares shall not be entitled as such to
receive notice of or to attend any meeting of the shareholders of the
Corporation or to vote at any such meeting.
ARTICLE 9
AMENDMENT AND APPROVAL
9.1 The rights, privileges, restrictions and conditions attaching to the
Exchangeable Shares may be added to, changed or removed but, except as
hereinafter provided, only with the approval of the holders of the
Exchangeable Shares given as hereinafter specified.
9.2 Any approval given by the holders of the Exchangeable Shares to add to,
change or remove any right, privilege, restriction or condition
attaching to the Exchangeable Shares or any other matter requiring the
approval or consent of the holders of the Exchangeable Shares shall be
deemed to have been sufficiently given if it shall have been given in
accordance with applicable law subject to a minimum requirement that
such approval be evidenced by resolution passed by not less than 66
2/3% of the votes cast on such resolution by persons represented in
person or by proxy at a meeting of holders of Exchangeable Shares
(excluding Exchangeable Shares beneficially owned by OSI or its
Subsidiaries) duly called and held at which the holders of at least 50%
of the outstanding Exchangeable Shares at that time are present or
represented by proxy. If at any such meeting the holders of at least
50% of the outstanding Exchangeable Shares at that time are not present
or represented by proxy within one-half hour after the time appointed
for such meeting, then the meeting shall be adjourned to such date not
less than 10 days thereafter and to such time and place as may be
designated by the Chairman of such meeting. At such adjourned meeting,
the holders of Exchangeable Shares present or represented by proxy
thereat may transact the business for which the meeting was originally
called and a resolution passed thereat by the affirmative vote of not
less than 66 2/3% of the votes cast on such resolution by persons
represented in person or by proxy at such meeting (excluding
Exchangeable Shares beneficially owned by OSI or its Subsidiaries)
shall constitute the approval or consent of the holders of the
Exchangeable Shares. For the purposes of this Section, any spoiled
votes, illegible votes, defective votes and abstinences shall be deemed
to be votes not cast.
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ARTICLE 10
RECIPROCAL CHANGES, ETC. IN RESPECT OF OSI COMMON STOCK
10.1
(a) Each holder of an Exchangeable Share acknowledges that the
Support Agreement provides, in part, that OSI will not:
(i) issue or distribute shares of OSI Common Stock (or
securities exchangeable for or convertible into or
carrying rights to acquire shares of OSI Common
Stock) to the holders of all or substantially all of
the then outstanding shares of OSI Common Stock by
way of stock dividend or other distribution; or
(ii) issue or distribute rights, options or warrants to
the holders of all or substantially all of the then
outstanding shares of OSI Common Stock entitling them
to subscribe for or to purchase shares of OSI Common
Stock (or securities exchangeable for or convertible
into or carrying rights to acquire shares of OSI
Common Stock); or
(iii) issue or distribute to the holders of all or
substantially all of the then outstanding shares of
OSI Common Stock (A) shares or securities of OSI of
any class other than OSI Common Stock (other than
shares convertible into or exchangeable for or
carrying rights to acquire shares of OSI Common
Stock), (B) rights, options or warrants other than
those referred to in subsection 11.1 (a) (ii) above,
(C) evidences of indebtedness of OSI or (D) assets of
OSI;
unless
(iv) one or both of OSI and the Corporation is permitted
under applicable law to issue or distribute the
economic equivalent on a per share basis of such
rights, options, warrants, securities, shares,
evidences of indebtedness or other assets to the
holders of the Exchangeable Shares; and
(v) one or both of OSI and the Corporation shall issue or
distribute the economic equivalent on a per share
basis of such rights, options, warrants, securities,
shares, evidences of indebtedness or other assets
simultaneously to the holders of the Exchangeable
Shares.
(b) Each holder of an Exchangeable Share acknowledges that the
Support Agreement further provides, in part, that OSI will
not:
(i) subdivide, redivide or change the then outstanding
shares of OSI Common Stock into a greater number of
shares of OSI Common Stock; or
(ii) reduce, combine or consolidate or change the then
outstanding shares of OSI Common Stock into a lesser
number of shares of OSI Common Stock; or
(iii) reclassify or otherwise change the shares of OSI
Common Stock or effect an amalgamation, merger,
reorganization or other transaction involving or
affecting the shares of OSI Common Stock;
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unless
(iv) the Corporation is permitted under applicable law to
simultaneously make the same or an economically
equivalent change to, or in the rights of the holders
of, the Exchangeable Shares; and
(v) the same or an economically equivalent change is
simultaneously made to, or in the rights of the
holders of, the Exchangeable Shares.
The Support Agreement further provides, in part, that, with the
exception of certain ministerial amendments, the aforesaid provisions of the
Support Agreement shall not be changed without the approval of the holders of
the Exchangeable Shares given in accordance with Article 9 of these share
provisions.
ARTICLE 11
ACTIONS BY THE CORPORATION UNDER SUPPORT AGREEMENT
11.1 The Corporation will take all such actions and do all such things as
shall be necessary or advisable to perform and comply with and to
ensure performance and compliance by OSI with all provisions of the
Support Agreement, the Voting Trust and Exchange Agreement and OSI's
Certificate of Incorporation applicable to the Corporation and OSI,
respectively, in accordance with the terms thereof including, without
limitation, taking all such actions and doing all such things as shall
be necessary or advisable to enforce to the fullest extent possible for
the direct benefit of the Corporation all rights and benefits in favour
of the Corporation under or pursuant thereto.
11.2 The Corporation shall not propose, agree to or otherwise give effect to
any amendment to, or waiver or forgiveness of its rights or obligations
under, the Support Agreement, the Voting Trust and Exchange Agreement
or OSI's Certificate of Incorporation without the approval of the
holders of the Exchangeable Shares given in accordance with Section 9.2
hereof other than such amendments, waivers and/or forgiveness as may be
necessary or advisable for the purpose of:
(a) adding to the covenants of the other party or parties to such
agreement for the protection of the Corporation or the holders
of Exchangeable Shares; or
(b) making such provisions or modifications not inconsistent with
such agreement or certificate as may be necessary or desirable
with respect to matters or questions arising thereunder which,
in the opinion of the Board of Directors, it may be expedient
to make, provided that the Board of Directors shall be of the
opinion, after consultation with counsel, that such provisions
and modifications will not be prejudicial to the interests of
the holders of the Exchangeable Shares; or
(c) making such changes in or corrections to such agreement or
certificate which, on the advice of counsel to the
Corporation, are required for the purpose of curing or
correcting any ambiguity or defect or inconsistent provision
or clerical omission or mistake or manifest error contained
therein, provided that the Board of
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Directors shall be of the opinion, after consultation with
counsel, that such changes or corrections will not be
prejudicial to the interests of the holders of the
Exchangeable Shares.
ARTICLE 12
LEGEND
12.1 The certificates evidencing the Exchangeable Shares shall contain or
have affixed thereto a legend, in form and on terms approved by the
Board of Directors, with respect to the Support Agreement, the
provisions of the Articles of the Corporation relating to the
Liquidation Call Right, the Retraction Call Right and the Redemption
Call Right, and the Voting and Exchange Trust Agreement (including the
provisions with respect to the voting rights and exchange provisions
thereunder).
ARTICLE 13
MISCELLANEOUS
13.1 Any notice, request or other communication to be given to the
Corporation by a holder of Exchangeable Shares shall be in writing and
shall be valid and effective if given by mail (postage prepaid) or by
telecopy or by delivery to the registered office of the Corporation and
addressed to the attention of the President. Any such notice, request
or other communication, if given by mail, telecopy or delivery, shall
only be deemed to have been given and received upon actual receipt
thereof by the Corporation.
13.2 Any presentation and surrender by a holder of Exchangeable Shares to
the Corporation or the Transfer Agent of certificates representing
Exchangeable Shares in connection with the liquidation, dissolution or
winding-up of the Corporation or the retraction, redemption or exchange
of Exchangeable Shares shall be made by registered mail (postage
prepaid) or by delivery to the registered office of the Corporation or
to such office of the Transfer Agent as may be specified by the
Corporation, in each case addressed to the attention of the President
of the Corporation. Any such presentation and surrender of certificates
shall only be deemed to have been made and to be effective upon actual
receipt thereof by the Corporation or the Transfer Agent, as the case
may be, and the method of any such presentation and surrender of
certificates shall be at the sole risk of the holder.
13.3 Any notice, request or other communication to be given to a holder of
Exchangeable Shares by or on behalf of the Corporation shall be in
writing and shall be valid and effective if given by mail (postage
prepaid) or by delivery to the address of the holder recorded in the
securities register of the Corporation or, in the event of the address
of any such holder not being so recorded, then at the last address of
such holder known to the Corporation. Any such notice, request or other
communication, if given by mail, shall be deemed to have been given and
received on the fifth Business Day following the date of mailing and,
if given by delivery, shall be deemed to have been given and received
on the date of delivery. Accidental failure or omission to give any
notice, request or other communication to one or more holders of
Exchangeable Shares shall not invalidate or
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otherwise alter or affect any action or proceeding to be or intended to
be taken by the Corporation.
13.4 For greater certainty, the Corporation shall not be required for any
purpose under these share provisions to recognize or take account of
persons who are not so recorded in such securities register.
13.5 All Exchangeable Shares acquired by the Corporation upon the redemption
or retraction thereof shall be cancelled.
13.6 For greater certainty, any payments to the holders of Exchangeable
Shares shall be net of applicable taxes, if any, and the payor shall
not be obliged to gross up or increase the amount of such payment which
would otherwise be made to take into account such taxes. Any such taxes
which have been withheld or deducted by the payor thereof shall be
remitted to the applicable tax authority within the time required for
such remittance.
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SCHEDULE "A"
RETRACTION REQUEST
To the Corporation, o ("OSI") and o ("OSI ULC")
This request is given pursuant to Article 6 of the provisions (the
"Share Provisions") attaching to the Exchangeable Shares of the Corporation and
all capitalized words and expressions used in this request which are defined in
the Share Provisions have the meaning attributed to such words and expressions
in such Share Provisions.
The undersigned hereby notifies the Corporation that, subject to the
Retraction Call Right referred to below, the undersigned requests the
Corporation to redeem in accordance with Article 6 of the Share Provisions:
[ ] all share(s) represented by the accompanying certificate(s);
or
[ ] ____________ share(s) only.
The undersigned hereby notifies the Corporation that the Retraction
Date shall be ___________________. date
NOTE: The Retraction Date must be a Business Day and must not be
less than three Business Days nor more than 10 Business Days
after the date upon which this notice and the accompanying
shares are received at the registered office of the
Corporation or at any office of the Transfer Agent as may be
specified in this Retraction Request. In the event that no
such Business Day is correctly specified above, the Retraction
Date shall be deemed to be the tenth Business Day after the
date on which this request is received by the Corporation.
The undersigned acknowledges the Retraction Call Right of OSI and OSI
ULC (as defined in the Share Provisions) to purchase all but not less than all
the Retracted Shares from the undersigned and that this request shall be deemed
to be a revocable offer by the undersigned to sell the Retracted Shares to OSI
or OSI ULC, as the case may be, in accordance with the Retraction Call Right on
the Retraction Date for the Retraction Price and on the other terms and
conditions set out in Section 6.3 of the Share Provisions. If neither OSI nor
OSI ULC, as the case may be, determines to exercise the Retraction Call Right,
the Corporation will notify the undersigned of such fact as soon as possible.
This retraction request, and offer to sell the Retracted Shares to OSI or OSI
ULC, as the case may be, may be revoked and withdrawn by the undersigned by
notice in writing given to the Corporation at any time before the close of
business on the Business Date immediately preceding the Retraction Date.
The undersigned acknowledges that if, as a result of liquidity or
solvency provisions of applicable law, the Corporation is unable to redeem all
Retracted Shares, the undersigned will be deemed to have exercised the Exchange
Right (as defined in the Voting and Exchange Trust Agreement) so as to require
OSI to purchase, or cause OSI ULC to purchase, the unredeemed Retracted Shares.
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<PAGE> 53
The undersigned hereby represents and warrants to the Corporation, OSI
and OSI ULC that the undersigned has good title to, and owns, the share(s)
represented by the accompanying certificate free and clear of all liens, claims,
encumbrances, security interests and adverse claims or interests.
<TABLE>
<S> <C> <C>
------------------------- ----------------------------------------- -----------------------------------------
Date Signature of Shareholder Guarantee of Signature
</TABLE>
[ ] Please check box if the legal or beneficial owner of the Retracted
Shares is a non-resident of Canada.
[ ] Please check box if the securities and any cheque(s) or other non-cash
assets resulting from the retraction of the Retracted Shares are to be
held for pick-up by the shareholder at the principal transfer offices
of Montreal Trust Company of Canada (the "Transfer Agent") in Calgary,
Alberta, failing which the securities and any cheque(s) or other
non-cash assets will be delivered to the shareholder in accordance with
the share provisions.
[ ] Please check box if the securities and any cheque(s) or other non-cash
assets resulting from the retraction of the Retracted Shares are to be
held for pick-up by the shareholder at the principal transfer offices
of Montreal Trust Company of Canada (the "Transfer Agent") in Toronto,
Ontario, failing which the securities and any cheque(s) or other
non-cash assets will be delivered to the shareholder in accordance with
the share provisions.
NOTE: This panel must be completed and the accompanying certificate,
together with such additional documents as the Transfer Agent
may require, must be deposited with the Transfer Agent at its
principal transfer offices in Calgary, Alberta or Toronto,
Ontario. The securities and any cheque(s) or other non-cash
assets resulting from the retraction or purchase of the
Retracted Shares will be issued and registered in, and made
payable to, or transferred into, respectively, the name of the
shareholder as it appears on the register of the Corporation
and the securities, cheque (s) and other non-cash assets
resulting from such retraction or purchase will be delivered
to the shareholder in accordance with the Share Provisions.
<TABLE>
<S> <C>
-------------------------------------------------------------------------- -------------------------------------
Name of Person in Whose Name Securities or Cheque(s) or Other Non-cash Date
Assets Are To Be Registered, Issued or Delivered (please print)
-------------------------------------------------------------------------- -------------------------------------
Street Address or P.O. Box Signature of Shareholder
-------------------------------------------------------------------------- -------------------------------------
City, Province Signature Guaranteed by
</TABLE>
NOTE: If this retraction request is for less than all of the
share(s) represented by the accompanying certificate, a
certificate representing the remaining shares of the
Corporation will be issued and registered in the name of the
shareholder as it appears on the register of the Corporation
or its lawful transferee.
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<PAGE> 54
B. OTHER PROVISIONS
1.1 Meetings
Meetings of shareholders of the Corporation shall be held in the
location determined by the directors of the Corporation, and may be held in
Houston, Texas, or at any location within Alberta.
1.2 Definitions
Unless there is something in the subject matter or context inconsistent
therewith in Sections 1.3, 1.4 and 1.5 below, the following terms shall have the
respective meanings set out below and grammatical variations of such terms shall
have corresponding meanings:
"Act" means the Business Corporations Act (Alberta), as amended;
"Automatic Redemption Date" has the meaning provided in the
Exchangeable Share Provisions;
"Business Day" has the meaning provided in the Exchangeable Share
Provisions;
"Exchangeable Share Consideration" has the meaning provided in the
Exchangeable Share Provisions;
"Exchangeable Share Price" has the meaning provided in the Exchangeable
Share Provisions;
"Exchangeable Share Provisions" means the rights, privileges,
restrictions and conditions attaching to the Exchangeable Shares;
"Exchangeable Shares" means the Exchangeable Shares in the capital of
the Corporation;
"Liquidation Call Purchase Price" has the meaning provided in Section
1.3;
"Liquidation Call Right" has the meaning provided in Section 1.3;
"Liquidation Date" has the meaning provided in the Exchangeable Share
Provisions;
"OSI" has the meaning provided in the Exchangeable Share Provisions;
"OSI Common Stock" has the meaning provided in the Exchangeable Share
Provisions;
"Redemption Call Purchase Price" has the meaning provided in Section
1.4;
"Redemption Call Right" has the meaning provided in Section 1.4;
"Subsidiary" has the meaning provided in the Exchangeable Share
Provisions;
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<PAGE> 55
"Transfer Agent" means the duly appointed transfer agent for the time
being of the Exchangeable Shares, and, if there is more than one such transfer
agent, then the principal Canadian transfer agent; and
"Voting and Exchange Trust Agreement" has the meaning provided in the
Exchangeable Share Provisions.
1.3 Liquidation Call Right
(a) OSI or OSI ULC shall have the overriding right (the
"Liquidation Call Right"), in the event of and notwithstanding
any proposed liquidation, dissolution or winding-up of the
Corporation as referred to in Article 5 of the Exchangeable
Share Provisions, to purchase directly from all but not less
than all of the holders (other than OSI or any Subsidiary
thereof) of Exchangeable Shares on the Liquidation Date all
but not less than all of the Exchangeable Shares held by such
holders on payment by OSI or OSI ULC to each holder of the
Exchangeable Share Price applicable on the last Business Day
prior to the Liquidation Date (the "Liquidation Call Purchase
Price") in accordance with subsection 1.3(c). In the event of
the exercise of the Liquidation Call Right by OSI or OSI ULC,
each holder shall be obligated to sell all the Exchangeable
Shares held by such holder to OSI or OSI ULC on the
Liquidation Date on payment by OSI or OSI ULC to the holder of
the Liquidation Call Purchase Price for each such share.
(b) To exercise the Liquidation Call Right, OSI or OSI ULC must
notify the Corporation's Transfer Agent in writing, as agent
for the holders of Exchangeable Shares, and the Corporation of
OSI's or OSI ULC's intention to exercise such right at least
55 days before the Liquidation Date in the case of a voluntary
liquidation, dissolution or winding-up of the Corporation and
at least five Business Days before the Liquidation Date in the
case of an involuntary liquidation, dissolution or winding-up
of the Corporation. The Transfer Agent will notify the holders
of Exchangeable Shares as to whether or not OSI or OSI ULC has
exercised the Liquidation Call Right forthwith after the
expiry of the date by which the same may be exercised by OSI
or OSI ULC. If OSI or OSI ULC exercises the Liquidation Call
Right, on the Liquidation Date OSI or OSI ULC will purchase
and the holders will sell all of the Exchangeable Shares then
outstanding for a price per share equal to the Liquidation
Call Purchase Price.
(c) For the purposes of completing the purchase of the
Exchangeable Shares pursuant to the Liquidation Call Right,
OSI or OSI ULC shall deposit with the Transfer Agent, on or
before the Liquidation Date, the Exchangeable Share
Consideration representing the total Liquidation Call Purchase
Price. Provided that such Exchangeable Share Consideration has
been so deposited with the Transfer Agent, on and after the
Liquidation Date, the right of each holder of Exchangeable
Shares will be limited to receiving such holder's
proportionate part of the total Liquidation Call Purchase
Price payable by OSI or OSI ULC, without interest, upon
presentation and surrender by the holder of certificates
representing the Exchangeable Shares held by such holder and
the holder shall, on and after the
B-25
<PAGE> 56
Liquidation Date, be considered and deemed for all purposes to
be the holder of the OSI Common Stock delivered to such
holder. Upon surrender to the Transfer Agent of a certificate
or certificates representing Exchangeable Shares, together
with such other documents and instruments as may be required
to effect a transfer of Exchangeable Shares under the Act and
the by-laws of the Corporation and such additional documents
and instruments as the Transfer Agent may reasonably require,
the holder of such surrendered certificate or certificates
shall be entitled to receive in exchange therefor, and the
Transfer Agent on behalf of OSI shall deliver to such holder,
the Exchangeable Share Consideration to which such holder is
entitled. If OSI or OSI ULC does not exercise the Liquidation
Call Right in the manner described above, on the Liquidation
Date the holders of the Exchangeable Shares will be entitled
to receive in exchange therefor the liquidation price
otherwise payable by the Corporation in connection with the
liquidation, dissolution or winding-up of the Corporation
pursuant to Article 5 of the Exchangeable Share Provisions.
Notwithstanding the foregoing, until such Exchangeable Share
Consideration is delivered to the holder, the holder shall be
deemed to still be a holder of Exchangeable Shares for
purposes of all voting rights with respect thereto under the
Voting and Exchange Trust Agreement.
1.4 Redemption Call Right
(a) OSI and OSI ULC shall have the overriding right (the
"Redemption Call Right"), notwithstanding any proposed
redemption of the Exchangeable Shares by the Corporation
pursuant to Article 7 of the Exchangeable Share Provisions, to
purchase directly from all but not less than all of the
holders (other than OSI or any Subsidiary thereof) of
Exchangeable Shares on the Automatic Redemption Date all but
not less than all of the Exchangeable Shares held by each such
holder on payment by OSI or OSI ULC to the holder of the
Exchangeable Share Price applicable on the last Business Day
prior to the Automatic Redemption Date (the "Redemption Call
Purchase Price") in accordance with subsection 1.4(c). In the
event of the exercise of the Redemption Call Right by OSI or
OSI ULC, each holder shall be obligated to sell all the
Exchangeable Shares held by the holder to OSI or OSI ULC on
the Automatic Redemption Date on payment by OSI or OSI ULC to
the holder of the Redemption Call Purchase Price for each such
share.
(b) To exercise the Redemption Call Right, OSI or OSI ULC must
notify the Transfer Agent in writing, as agent for the holders
of Exchangeable Shares, and the Corporation of the OSI's or
OSI ULC's intention to exercise such right not later than the
date by which the Corporation is required to give notice of
the Automatic Redemption Date. The Transfer Agent will notify
the holders of the Exchangeable Shares as to whether or not
OSI or OSI ULC has exercised the Redemption Call Right
forthwith after the date by which the same may be exercised by
OSI or OSI ULC. If OSI or OSI ULC exercises the Redemption
Call Right, on the Automatic Redemption Date, OSI will
purchase and the holders will sell all of the Exchangeable
Shares then outstanding for a price per share equal to the
Redemption Call Purchase Price.
B-26
<PAGE> 57
(c) For the purposes of completing the purchase of the
Exchangeable Shares pursuant to the Redemption Call Right, OSI
or OSI ULC shall deposit with the Transfer Agent, on or before
the Automatic Redemption Date, the Exchangeable Share
Consideration representing the total Redemption Call Purchase
Price. Provided that such Exchangeable Share Consideration has
been so deposited with the Transfer Agent, on and after the
Automatic Redemption Date, the rights of each holder of
Exchangeable Shares will be limited to receiving such holder's
proportionate part of the total Redemption Call Purchase Price
payable by OSI or OSI ULC upon presentation and surrender by
the holder of certificates representing the Exchangeable
Shares held by such holder and the holder shall on and after
the Automatic Redemption Date be considered and deemed for all
purposes to be the holder of the OSI Common Stock delivered to
such holder. Upon surrender to the Transfer Agent of a
certificate or certificates representing Exchangeable Shares,
together with such other documents and instruments as may be
required to effect a transfer of Exchangeable Shares under the
Act and the by-laws of the Corporation and such additional
documents and instruments as the Transfer Agent may reasonably
require, the holder of such surrendered certificate or
certificates shall be entitled to receive in exchange
therefor, and the Transfer Agent on behalf of OSI or OSI ULC
shall deliver to such holder, the Exchangeable Share
Consideration to which such holder is entitled. If OSI or OSI
ULC does not exercise the Redemption Call Right in the manner
described above, on the Automatic Redemption Date, the holders
of the Exchangeable Shares will be entitled to receive in
exchange therefor the redemption price otherwise payable by
the Corporation in connection with the redemption of the
Exchangeable Shares pursuant to Article 7 of the Exchangeable
Share Provisions. Notwithstanding the foregoing, until such
Exchangeable Share Consideration is delivered to the holder,
the holder shall be deemed to still be a holder of
Exchangeable Shares for purposes of all voting rights with
respect thereto under the Voting and Exchange Trust Agreement.
1.5 Retraction Call Right
OSI or OSI ULC shall have the overriding right, notwithstanding the
proposed redemption of Exchangeable Shares by the Corporation pursuant to
Article 6 of the Exchangeable Share Provisions, to purchase directly from the
holder (other than OSI or any Subsidiary thereof) of Exchangeable Shares all but
not less than all of the Retracted Shares in accordance with Section 6.3 of the
Exchangeable Share Provisions.
B-27
