EXHIBIT 2.1
ACQUISITION AGREEMENT
AMONG
FRANKLIN RESOURCES, INC.
- AND -
FTI ACQUISITION INC.
- AND -
BISSETT & ASSOCIATES INVESTMENT MANAGEMENT LTD.
DATED JULY 26, 2000
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TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS.................................................1
1.1 Certain Definitions and Rules of Construction..........1
ARTICLE 2
THE OFFER...................................................2
2.1 Covenants..............................................2
2.2 Approval of the Corporation............................5
2.3 Shareholder Lists......................................6
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND THE
OFFEROR.....................................................6
3.1 Corporate Organization.................................6
3.2 Enforceability of Agreement............................6
3.3 Conflicting Provisions.................................7
3.4 Consents...............................................7
3.5 Sufficient Funds.......................................7
3.6 Shareholdings..........................................7
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE CORPORATION...........7
4.1 Corporate Organization and Subsidiaries................7
4.2 Enforceability of Agreement............................7
4.3 Conflicting Provisions.................................8
4.4 Consents...............................................8
4.5 Public Disclosure......................................9
4.6 Absence of Changes....................................10
4.7 Absence of Litigation.................................10
4.8 Undisclosed Liabilities...............................10
4.9 Material Contracts....................................10
4.10 Insurance.............................................11
4.11 Tax Matters...........................................11
4.12 Change of Control Provisions..........................12
4.13 Employees.............................................12
4.14 Intellectual Property and Software....................12
4.15 Licences..............................................12
4.16 The Funds.............................................13
4.17 Units of Funds........................................13
4.18 Agreements............................................13
4.19 Clients...............................................13
4.20 Outstanding Shares....................................14
4.21 United States Assets and Revenues.....................14
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TABLE OF CONTENTS
(CONTINUED)
PAGE
ARTICLE 5
COVENANTS..................................................14
5.1 Conduct of Business of the Corporation................14
5.2 Board of Directors....................................16
5.3 Access to Information.................................16
5.4 No Solicitation.......................................16
5.5 Further Action; Commercially Reasonable Best
Efforts...............................................18
5.6 Regulatory Approvals..................................18
5.7 Take Up and Payment...................................18
5.8 Increase in Consideration.............................19
5.9 Subsequent Acquisitions...............................19
5.10 Further Covenants.....................................19
5.11 Take-Up and Payment For Shares........................20
5.12 Clients...............................................20
ARTICLE 6
TERMINATION, AMENDMENT AND WAIVER..........................20
6.1 Termination...........................................20
6.2 Effect of Termination.................................21
6.3 Fees..................................................21
6.4 Commissions...........................................21
6.5 Waiver................................................22
ARTICLE 7
GENERAL PROVISIONS.........................................22
7.1 Survival of Representations, Warranties and
Agreements............................................22
7.2 Notices...............................................22
7.3 Severability..........................................24
7.4 Entire Agreement; Assignment..........................24
7.5 Time..................................................24
7.6 Currency..............................................24
7.7 Amendments............................................24
7.8 Expenses..............................................24
7.9 Counterparts..........................................25
7.10 Governing Law.........................................25
7.11 Public Statements.....................................25
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ACQUISITION AGREEMENT
ACQUISITION AGREEMENT, dated July 26, 2000 (this "Agreement"), among
Franklin Resources, Inc., a corporation incorporated under the laws of the State
of Delaware (the "Purchaser"), FTI Acquisition Inc., a corporation incorporated
under the BUSINESS CORPORATIONS ACT ("Ontario") (the "Offeror") and Bissett &
Associates Investment Management Ltd. (the "Corporation"), a corporation
incorporated under the laws of the BUSINESS CORPORATIONS ACT (Alberta).
WHEREAS the Board of Directors of each of the Purchaser and the Offeror
has approved this Agreement and the transactions contemplated hereby;
AND WHEREAS the Board of Directors of the Corporation has
approved this Agreement and the transactions contemplated hereby;
AND WHEREAS the Purchaser has, concurrently with the execution of this
Agreement, entered into employment agreements with certain of the Corporation's
key employees (the "Employment Agreements") and non-competition agreements with
certain of the Corporation's directors (the "Non-Competition Agreements"), and
will enter into an escrow agreement with certain key employees of the
Corporation (the "Escrow Agreement"), which agreements shall become effective
upon the consummation of the transactions contemplated hereby;
AND WHEREAS the principal shareholders of the Corporation listed in
Schedule "A" hereto have entered into lockup agreements with, among others, the
Purchaser (the "Lock-Up Agreements");
NOW THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby, the
Purchaser, the Offeror and the Corporation hereby agree as follows:
ARTICLE 1
DEFINITIONS
1.1 CERTAIN DEFINITIONS AND RULES OF CONSTRUCTION
(a) For purposes of this Agreement, the terms defined in Schedule "E"
forming part of this Agreement shall have the meanings ascribed
thereto in Schedule "E".
(b) The words "included", "includes" and "including" shall be deemed to be
followed by the phrase "without limitation".
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ARTICLE 2
THE OFFER
2.1 COVENANTS
(a) TIMING
The Purchaser agrees to cause the Offeror to make, and the Offeror
agrees to make, on or before August 15, 2000 (the "Offer Deadline")
an offer (the "Offer") at a price of $20.50 per share (the "Offer
Price") on the terms summarized in Schedule "B" forming part of this
Agreement to all holders for 100% of the Corporation's issued and
outstanding common shares, including any shares which may become
outstanding pursuant to the exercise of currently outstanding stock
options to acquire shares of the Corporation (the "Shares").
(b) FINANCING
The Purchaser covenants and agrees that it shall ensure that the
Offeror has and shall have all adequate arrangements for financing in
place to make and complete the Offer and to purchase all of the
outstanding Shares, under the Offer.
(c) PUBLIC ANNOUNCEMENT
The Purchaser and the Corporation shall publicly and jointly announce
the Offer following the execution of this Agreement by the parties,
the execution of agreements of even date with certain shareholders
and employees of the Corporation, and approval by the Board of
Directors of the Corporation, the text of such announcement to be
approved by the Purchaser and the Corporation in advance.
(d) CONDITIONS PRECEDENT
Notwithstanding Section 2.1(a), the Offeror, acting reasonably, shall
not be required to make the Offer (and the Offeror and the Purchaser
may, without prejudice to any other rights, by notice to the
Corporation terminate this Agreement) if:
(i) any act, action, suit or proceeding shall have been threatened or
taken before or by any domestic or foreign arbitrator, court or
tribunal or governmental agency or other regulatory authority or
administrative agency or commission by any elected or appointed
public official or private person (including, without limitation,
any individual, corporation, firm, group or other entity) in
Canada or elsewhere, whether or not having the force of law, or
any law, regulation or policy shall have been proposed, enacted,
promulgated or applied, in either case:
(A) to cease trade, enjoin, prohibit or impose material
limitations or conditions on the right of the Offeror to own
or exercise full rights
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of ownership over the Shares or the consummation of any of
the material transactions contemplated by the Offer or, to
prevent the completion of any Compulsory Acquisition or
Subsequent Acquisition Transaction or which could
reasonably be expected to have such an effect;
(B) to prohibit or materially limit the ownership or operation
by the Corporation, or by the Offeror or the Purchaser,
directly or indirectly, of all or any material portion of
the business or assets of the Corporation, or the Offeror or
the Purchaser as a result of the transactions contemplated
by the Offer or any Compulsory Acquisition or Subsequent
Acquisition Transaction or compel the Offeror or the
Purchaser, directly or indirectly, to dispose of or hold
separate all or any material portion of the business or
assets of the Corporation, or the Offeror or the Purchaser
as a result of the transactions contemplated by the Offer;
or
(C) which has had or would have a Material Adverse Effect;
(ii) any of the signatories to the Lock-Up Agreements other than the
Purchaser shall have breached the Lock-Up Agreements, if such
breach would materially adversely affect the Purchaser or Offeror
or the Offeror's ability to consummate the Offer;
(iii)any of Ms. Grant and Messrs. Pynn, Quinn and Wolfe shall have
repudiated his or her Employment Agreement;
(iv) either of Mr. Guest or Mr. Bissett shall have repudiated his
Non-Competition Agreement;
(v) any of the Principal Shareholders who are signatories to the
Escrow agreement shall not have entered into or shall have
repudiated the Escrow Agreement, or shall have failed to provide
to the Purchaser prior to August 4, 2000 legal opinions and such
other documentation relating to the enforceability of the Escrow
Agreement, as the Purchaser may reasonably request;
(vi) at the time the Offeror proposes to make the Offer, there exists
any prohibition at law against the Offeror making the Offer or
taking up and paying for 100% of the Common Shares under the
Offer;
(vii)the representations and warranties of the Corporation provided
herein shall not have been, as of the date made and as of the
date of the Offer, true and correct, or the Corporation shall not
have complied with any covenants or agreements to be complied
with by it under this Agreement, except if failure of the
representations, warranties, covenants or agreements does not, in
the aggregate, have a Material Adverse Effect or would not
materially adversely affect the ability of the Offeror to
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consummate the Offer or any Compulsory Acquisition or Subsequent
Acquisition Transaction; or
(viii) the Corporation shall not have provided the required notice
pursuant to Section 5.8 of National Instrument 81-102 (the
"Mutual Fund Notice") to all security holders of the mutual funds
for which it acts as manager relating to the proposed change of
control of the Corporation.
The foregoing conditions are for the sole benefit of the Purchaser
and the Offeror and may be waived by the Offeror in whole or in part
at any time and shall be deemed to have been waived by it for the
purposes of this Section 2.1(d) by the making of the Offer.
(e) OFFER DOCUMENTS
The Offeror shall prepare the Offer, the take-over bid circular and
the related letter(s) of transmittal and notice(s) of guaranteed
delivery (collectively, the "Offer Documents") with respect to the
Offer in both English and French in compliance with the OSA and all
other applicable Canadian provincial securities laws, rules and
regulations and published policies thereunder, all applicable
securities law in the United States (and in the applicable states
therein), rules of applicable stock exchanges and applicable
corporation laws (collectively, the "Securities Laws"). The
Corporation and its counsel shall be given an opportunity to review
the Offer Documents and comment thereon, prior to their being mailed
to holders of record of Shares (the "Shareholders") and filed with
the applicable securities regulatory authorities. The Offeror shall
provide the Corporation with a final copy of the Offer Documents to
be mailed to all Shareholders prior to the mailing to Shareholders.
The Offeror shall file the Offer Documents on a timely basis with the
appropriate securities commissions and other regulatory authorities
(the "Securities Authorities"). The Offer Documents, when filed with
the Securities Authorities and mailed to the Shareholders, shall
contain all information which is required to be included therein in
accordance with any applicable laws, including, without limiting the
generality of the foregoing, the ABCA and the Securities Laws, and
shall in all material respects comply with the requirements of
applicable laws, including the ABCA and Securities Laws. The terms of
the Offer shall comply with the terms of this Agreement.
(f) DEALER MANAGER
The Offeror may, at its expense, appoint a dealer manager in
connection with the Offer and to solicit acceptances of the Offer. If
appointed, the dealer manager shall form a soliciting dealer group
comprised of members of the Investment Dealer Association of Canada
and of the stock exchanges in Canada to solicit acceptance of the
Offer in Canada.
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(g) DIVIDENDS
The Offeror, the Purchaser and the Corporation agree and acknowledge
that the Board of Directors of the Corporation shall be permitted to
declare a dividend of $0.48 per Common Share (the "Dividend"), with
such Dividend to be paid to shareholders of record immediately prior
to the time that any Shares are taken up under the Offer. Each of the
parties covenants and agrees to co-operate in establishing a protocol
with respect to the declaration, notice and payment of the Dividend.
For the purposes of the Agreement, the Offer and the declaration and
payment of the Dividend shall be collectively referred to as the
"Transaction".
(h) OUTSTANDING "IN-THE-MONEY" STOCK OPTIONS
The Purchaser and the Offeror covenant and agree that the Corporation
may use its reasonable commercial efforts to encourage all persons
holding options to purchase Shares pursuant to the Corporation's
employee stock option plan that are exercisable at a price of $16.95
per share, to either (a) exercise their options prior to the expiry
of the Offer and to deposit all Shares issued in connection therewith
to the Offer; or (b) elect to receive cash payments from the
Corporation of $4.03 per share in exchange for the termination of
their options.
2.2 APPROVAL OF THE CORPORATION
(a) The Corporation represents that its board of directors has received
from its financial advisors a fairness opinion that the Transaction is
fair, from a financial point of view, to holders of common shares and
has unanimously: (i) determined that, upon review of such fairness
opinion and all other relevant matters, the Transaction is fair to
holders of common shares and in the best interests of the Corporation;
(ii) approved this Agreement and the transactions contemplated hereby
which involve the Corporation; and (iii) resolved to recommend that
the Shareholders accept the Offer and tender their Shares to the
Offeror thereunder unless there is another offer for all of the Shares
which is a Superior Proposal (as hereinafter defined) at the time the
recommendation is made.
(b) The Corporation shall mail, and shall use its reasonable commercial
efforts to do so concurrently with the mailing of the Offer Documents,
to Shareholders and to each of the directors of the Corporation, and
file with the applicable Securities Authorities, a directors' circular
(together with all amendments, supplements and exhibits thereto, the
"Directors' Circular") in English and in French which shall reflect
the determinations and recommendation referred to in Section 2.2(a),
together with a written fairness opinion of RBC Dominion Securities
Inc. The Corporation shall comply with all Securities Laws in respect
of the Offer. The Offeror and its counsel shall be provided with a
copy of the Directors' Circular for their review and comment prior to
its being mailed to Shareholders and filed with the applicable
Securities Authorities. Each of the Offeror and the Corporation agrees
to provide the other and their respective counsel in writing with any
written comments, notice or communications either of them or their
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respective counsel may receive from the Securities Authorities
with respect to the Offer, the Offer Documents and the Directors'
Circular promptly after the receipt of such comments.
2.3 SHAREHOLDER LISTS
The Corporation shall or shall cause its transfer agent to prepare a list of
shareholders of the Corporation in accordance with the provisions of the ABCA
and a list of holders of stock options (with full particulars as to the exercise
price and expiry date), as well as a security position listing from each
depository including, without limitation, The Canadian Depository for Securities
Limited, and deliver same to the Offeror as soon as practicable after the
execution of this Agreement (and with respect to the registered list only, in
any event within three business days), and, if requested by the Offeror, to
prepare supplemental lists setting out any changes to the aforesaid lists for
each business day thereafter, and deliver same to the Offeror. All such
aforesaid deliveries shall be in both printed and computer readable form.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF
THE PURCHASER AND THE OFFEROR
Each of the Purchaser and the Offeror hereby represents and warrants to the
Corporation that:
3.1 CORPORATE ORGANIZATION
It is a corporation duly incorporated and validly existing under the laws of its
jurisdiction of incorporation and has all necessary corporate power, and
authority, capacity and right to enter into this Agreement and complete the
transactions contemplated by this Agreement.
3.2 ENFORCEABILITY OF AGREEMENT
It has the requisite corporate power and authority to enter this Agreement and
to carry out its obligations hereunder and the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby and by
the Offer have been duly authorized and no other corporate proceedings on its
part are or will be necessary to authorize this Agreement and the transactions
contemplated hereby, other than approval of final form of the Offer Documents by
the board of the directors of the Offeror. This Agreement has been duly
authorized and executed by it and constitutes a legal, valid and binding
agreement enforceable by the Corporation against it in accordance with its
terms, subject to the qualification that such validity, binding effect and
enforceability may be limited by: (i) applicable bankruptcy, insolvency,
moratorium, reorganization or other laws affecting creditors' rights generally;
(ii) equitable remedies, including the remedies of specific performance and
injunctive relief, being available only in the discretion of the applicable
court; (iii) the statutory and inherent powers of a court to grant relief from
forfeiture, to stay execution of proceedings before it and to stay executions on
judgments; (iv) the applicable laws regarding limitations of actions; (v)
enforceability of provisions which purport to sever any provision which is
prohibited or unenforceable under applicable law without affecting the
enforceability or validity of the remainder of such document would be determined
only in the discretion of the court; (vi) enforceability of the provisions
exculpating a party from liability or duty otherwise owed by it may be limited
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under applicable law; and (vii) the enforceability of any waiver of statutory
rights may be limited by applicable law.
3.3 CONFLICTING PROVISIONS
It is not, and at the date of or at any time during the Offer will not be, a
party to, bound or affected by or subject to, any agreement, charter or by-law
provision, statute, regulation, judgment, order, decree or law which would be
violated, contravened, breached by, or under which default would occur as a
result of, the execution and delivery or performance of this Agreement, the
making of the Offer or the acquisition of any of the Shares pursuant to the
Offer and which default, violation, contravention or breach would materially
impair or would prevent it from consummating the transactions contemplated
hereby.
3.4 CONSENTS
No consent, waiver, approval, authorization, exemption, registration, licence or
declaration of or by, or filing with, or notification to any governmental agency
or other regulatory authority or administrative agency or commission is required
to be made or obtained by it in connection with (i) the execution and delivery
by it of this Agreement, or (ii) the consummation by it of any of the
transactions provided for herein, except for or in connection with the
regulatory approvals referred to in Schedule "C" hereto.
3.5 SUFFICIENT FUNDS
The Offeror now has and will have at the date of the Offer and until the Offeror
has paid for all of the Shares acquired by it pursuant to the Offer, sufficient
funds or financing in place to provide sufficient funds to purchase all Shares
tendered under the Offer.
3.6 SHAREHOLDINGS
Neither it, nor its respective associates and affiliates, beneficially own,
directly or indirectly, or exercise control or direction over, any Shares.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
The Corporation represents and warrants to the Purchaser and the Offeror that:
4.1 CORPORATE ORGANIZATION AND SUBSIDIARIES
The Corporation is a corporation duly incorporated and validly existing under
the ABCA and has all necessary corporate power, authority, capacity and right to
enter into this Agreement and to complete the transactions contemplated hereby.
The Corporation does not have any Subsidiaries.
4.2 ENFORCEABILITY OF AGREEMENT
The Corporation has the requisite corporate power and authority to enter this
Agreement and to carry out its obligations hereunder and the execution and
delivery of this Agreement and the consummation of the transactions contemplated
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hereby and by the Offer have been duly authorized and no other corporate
proceedings on its part are or will be necessary to authorize this Agreement and
the transactions contemplated hereby, other than approval of final form of the
Directors Circular by the board of the directors of the Corporation. This
Agreement has been duly authorized and executed by it and constitutes a legal,
valid and binding agreement enforceable by the Purchaser and the Offeror against
the Corporation in accordance with its terms, subject to the qualification that
such validity, binding effect and enforceability may be limited by: (i)
applicable bankruptcy, insolvency, moratorium, reorganization or other laws
affecting creditors' rights generally; (ii) equitable remedies, including the
remedies of specific performance and injunctive relief, being available only in
the discretion of the applicable court; (iii) the statutory and inherent powers
of a court to grant relief from forfeiture, to stay execution of proceedings
before it and to stay executions on judgments; (iv) the applicable laws
regarding limitations of actions; (v) enforceability of provisions which purport
to sever any provision which is prohibited or unenforceable under applicable law
without affecting the enforceability or validity of the remainder of such
document would be determined only in the discretion of the court; (vi)
enforceability of the provisions exculpating a party from liability or duty
otherwise owed by it may be limited under applicable law; and (vii) the
enforceability of any waiver of statutory rights may be limited by applicable
law.
4.3 CONFLICTING PROVISIONS
The Corporation is not a party to, bound or affected by or subject to, any
agreement, charter or by-law provision, statute, regulation, judgment, order,
decree or law which would be violated, contravened, breached by, or under which
default would occur as a result of, the execution and delivery or performance of
this Agreement and which default, violation, contravention or breach would
constitute a Material Adverse Effect or would prevent the Corporation from
consummating the transactions contemplated hereby, provided that all regulatory
approvals and consents referred to in Schedule "C" are obtained prior thereto.
4.4 CONSENTS
No consent, waiver, approval, authorization, exemption, registration, licence or
declaration of or by, or filing (other than pursuant to the Securities Laws)
with, or notification to any governmental agency or other regulatory authority
or administrative agency or commission is required to be made or obtained by the
Corporation in connection with (i) the execution and delivery by the Corporation
of this Agreement, or (ii) the consummation by the Corporation of any of the
transactions provided for herein, except for or in connection with the
regulatory approvals referred to in Schedule "C" hereto and in connection with
the escrow agreement dated June 4, 1998 among the Corporation, Montreal Trust
Company of Canada and certain of the Corporation's shareholders (the "Bissett
Escrow Agreement"), and except for any consent, waiver, approval, authorization,
exemption, registration, licence, declaration, filing or notification, of which
the failure to have, make or receive, individually or in the aggregate, would
not have a Material Adverse Effect.
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4.5 PUBLIC DISCLOSURE
(a) The Corporation has complied in all material respects with its
obligations to file all forms, reports, statements, schedules,
documents, financial statements and annual reports to unitholders with
respect to the Corporation's funds required to be filed with the
Securities Authorities (collectively, the "Reports"), each of which
Reports complied in all material respects with the applicable
requirements of the Securities Laws, as in effect on the date so
filed. None of such Reports (including any financial statements,
schedules, documents or exhibits included or incorporated by reference
therein) or any other document when filed pursuant to the Securities
Laws contained any Misrepresentation.
(b) The audited financial statements of the Corporation (including any
related notes thereto) for the three fiscal years ended December 31,
1997, 1998 and 1999 (the "Audited Statements") and the unaudited
statements for the six months ended June 30, 2000 (the "Unaudited
Statements") (the Audited Statements and the Unaudited Statements,
collectively, the "Financial Statements") which have previously been
furnished to the Purchaser, have been prepared in accordance with
Canadian generally accepted accounting principles, applied on a
consistent basis throughout the periods involved and fairly present,
in all material respects, the financial position of the Corporation at
the dates thereof and the results of its operations and changes in
cash flows for the periods indicated (except (i) as otherwise
indicated in such financial statements and the notes thereto or, in
the case of Audited Statements, in the related report of the
Corporation's independent accountants or (ii) in the case of Unaudited
Statements, to the extent they may not include footnotes or may be
condensed or summary statements).
(c) Except as and to the extent set forth on the balance sheet of the
Corporation as at June 30, 2000, the Corporation does not have any
liabilities or obligations of any nature (whether accrued, absolute,
contingent or otherwise) which would be required to be reflected on a
balance sheet or in the notes thereto prepared in accordance with
Canadian generally accepted accounting principles, except for
liabilities or obligations incurred in the ordinary course of business
since June 30, 2000 which do not, individually or in the aggregate,
constitute a Material Adverse Effect.
(d) The information relating to the Corporation provided to the Offeror or
the Purchaser by the Corporation, whether pursuant to this Agreement
or in conjunction with the pre-agreement investigation by or on behalf
of the Purchaser prior to the date of this Agreement, contains no
untrue statement of a Material Fact and does not omit to state a
Material Fact that is necessary to make any statement therein not
misleading in light of the circumstances in which it was made.
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4.6 ABSENCE OF CHANGES
Since December 31, 1999, except as set forth in the Reports or in a news release
generally circulated, there has not been:
(a) any change in the financial condition or operations of the Corporation
constituting a Material Adverse Effect; or
(b) any damage, destruction, loss, labour trouble or other event,
development or condition of any character (whether or not covered by
insurance) constituting a Material Adverse Effect.
4.7 ABSENCE OF LITIGATION
Except as disclosed to the Purchaser in writing on or prior to the date hereof,
there are no suits, claims, actions, proceedings or investigations pending or,
to the knowledge of the Corporation, threatened against the Corporation, or any
properties, assets or rights of the Corporation, before any court, arbitrator or
administrative, governmental or regulatory authority or body, including any
environmental actions or proceedings which, if determined adversely against the
Corporation, would have a Material Adverse Effect and, to the knowledge of the
Corporation, there are no bases or grounds on which such a suit, claim, action,
proceeding or investigation could be commenced with a reasonable likelihood of
success. Neither the Corporation nor any of its properties or assets is or are
subject to any order, writ, judgment, injunction, decree, determination or
award. There are no actions, suits, demands, claims, hearings, investigations or
proceedings pending or, to the knowledge of the Corporation, threatened against
the Corporation relating to any violation or alleged violation of any
environmental laws which, if determined adversely against the Corporation, would
have a Material Adverse Effect.
4.8 UNDISCLOSED LIABILITIES
The Corporation does not have any outstanding material liabilities or material
obligations, including without limitation any liabilities for taxes, contingent
liabilities that may arise, and whether contractual or otherwise, or breach of
applicable laws or infringement of proprietary rights of any third party, other
than those liabilities set out in the Financial Statements or as disclosed to
the Purchaser in writing on or prior to the date hereof. All compensation
arrangements, including bonuses and termination payments, payable to officers
and directors of the Corporation as of the date hereof are disclosed in the
Reports, the spreadsheet provided by the Corporation to the Purchaser or have
otherwise been disclosed to the Purchaser in writing on or prior to the date
hereof, and the Corporation will not make any changes to such arrangements after
the date hereof except as consented to by the Purchaser, such consent not to be
unreasonably withheld, or as specifically provided for herein.
4.9 MATERIAL CONTRACTS
The Corporation has made available to the Purchaser for its review all of the
Material Contracts. Except as disclosed to the Purchaser in writing on or prior
to the date hereof, the Corporation is not in material default or material
breach of, nor has the Corporation received any notice of default or termination
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under, any Material Contract and, in respect of such Material Contracts and all
other contracts or agreements to which the Corporation is a party or by which it
is bound, there exists no state of facts which after notice or lapse of time or
both would constitute such a default or breach which default or breach,
individually or in aggregate, would have a Material Adverse Effect.
4.10 INSURANCE
The Corporation has made available to the Purchaser all existing policies of
insurance maintained by the Corporation at the date hereof, including the name
of the insurer, the risks insured against and the amount of coverage. All such
policies are in full force and effect. The Corporation is not in default or
breach of the payment of premiums, and is not otherwise in material default, and
the Corporation has not received any notice of default or termination under, any
such policy and there exists no state of facts which after notice or lapse of
time or both could reasonably be expected to constitute such a default or
breach.
4.11 TAX MATTERS
(a) The Corporation has timely filed, or caused to be filed, all tax
returns required to be filed by it (all of which returns were correct
and complete) and has paid, or caused to be paid, all taxes that are
due and payable and the Corporation has provided adequate accruals in
accordance with Canadian generally accepted accounting principles in
the Financial Statements for any taxes for the period covered by such
Financial Statements that have not been paid, whether or not shown as
being due on any tax returns. The Corporation has made adequate
provision in its books and records for any taxes accruing in respect
of any period subsequent to the period covered by such Financial
Statements. Since such date, no tax liability not reflected in such
statements or otherwise provided for has been assessed, proposed to be
assessed, incurred or accrued other than in the ordinary course of
business. The Corporation has withheld from all payments made by it,
or otherwise collected, all amounts in respect of taxes required to be
withheld therefrom or collected by it, and has remitted same to the
applicable governmental entity within the required time periods. The
Corporation has not assumed any liability for the taxes of any other
person, other than pursuant to employee source deductions,
non-resident withholding taxes and sales and excise taxes (including
goods and services tax) prescribed by law.
(b) Except as disclosed to the Purchaser in writing prior to the date
hereof, the Corporation is not aware of any tax-related issues which
are currently pending with Revenue Canada or any other taxing
authority, including, without limitation, any sales tax authority, in
connection with any of the tax returns referred to above, and, no
waivers of statutes of limitations or extensions of time have been
given or requested with respect to the Corporation. All tax liability
of the Corporation has been assessed for all fiscal years up to and
including the fiscal year ended December 31, 1998. The Corporation is
not aware of any proposed (but unassessed) additional taxes for which
it would be liable.
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12
(c) The Corporation is not aware of any claim having been made, which
claim is still outstanding, by an authority in any jurisdiction where
the Corporation does not file tax returns that the Corporation is or
may be subject to taxation by that jurisdiction. The Corporation is
not aware of any liens or encumbrances on any of the assets of the
Corporation that has arisen and is still outstanding in connection
with any failure (or alleged failure) to pay any tax.
(d) The Corporation is not aware of any outstanding rulings of, or
requests for rulings with, any tax authority expressly addressed to
the Corporation that are, or if issued would be, binding upon the
Corporation.
4.12 CHANGE OF CONTROL PROVISIONS
The change of control of the Corporation will not (i) create any material
liability on the part of the Corporation; (ii) except as disclosed to the
Purchaser in writing prior to the date hereof, result in a material breach of a
Material Contract entered into by the Corporation; or (iii) subject to the
receipt of regulatory approvals set out in Schedule C, result in the loss of any
regulatory approval or authorization held by the Corporation.
4.13 Employees
The business of the Corporation has been and is being operated in all material
respects in compliance with all applicable laws relating to employees, including
employment standards, occupational health and safety, pay equity and employment
equity. All employee benefit plans of the Corporation are established,
registered, qualified, administered and invested in all material respects in
compliance with all applicable laws and the terms thereof. The Corporation does
not have a pension plan.
4.14 Intellectual Property and Software
The Corporation possesses, or has all necessary rights to use, all patents,
trade names, trademarks, processes, know-how and software currently used by it
in connection with its business, and all material patents and trade-marks are
subject to application or duly registered where required, except where the
failure to do so would not constitute a Material Adverse Effect. The Corporation
has not received any complaint, assertion, threat or allegation or otherwise has
notice of any lawsuit, claim, demand, proceeding or investigation involving any
infringement or misuse of any patents, trademarks or software used by the
Corporation except as disclosed to the Purchaser in writing on or prior to the
date hereof. The Corporation has the right to use all software used by it in its
business free and clear of all liens and encumbrances, subject to the terms of
applicable licenses.
4.15 Licences
The Corporation possesses all material licences or other material rights
necessary to carry on its current business.
<PAGE>
13
4.16 THE FUNDS
Each Fund for which the Corporation acts as trustee or manager is listed in
Schedule "D" hereto and is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization and has the requisite
corporate or trust power and authority to own its properties and to carry on its
business as it is now conducted, and is qualified to do business in each
jurisdiction where it is required to do so under applicable laws except where
the failure to so qualify would not have a Material Adverse Effect. Each Fund
is, and at all times to the extent required under applicable laws since its
organization has been, duly registered with the applicable securities regulatory
authority. The Corporation has performed its obligations, in all material
respects, as trustee, manager and distributor of each Fund as set out in the
declaration of trust of the Fund, any agreements entered into with the Fund and
under applicable laws. Each Fund is invested, and is in all material respects
operated, in accordance with its declaration of trust and applicable laws
including National Instrument 81-102 as issued by the Canadian Securities
Administrators.
4.17 UNITS OF FUNDS
The units of each Fund have been duly and validly issued and are fully paid and
non-assessable. As manager of the Funds, the Corporation is required to file an
annual information form and simplified prospectus (the "Mutual Funds Documents")
and to receive a final receipt for same from or on behalf of the securities
commissions in Canada on or before August 19, 2000. The Corporation has made
application for a 90-day extension to such filing requirement so that if such
application is granted, a final receipt in respect of the Mutual Fund Documents
would not be required until on or before November 19, 2000. Subject to the
foregoing application, the units of each Fund are qualified for public offering
and sale in each jurisdiction where offers are made to the extent required under
applicable law. Each Fund has been operated since its organization and is
currently operating in compliance in all material respects with applicable law.
4.18 AGREEMENTS
Each investment advisory agreement, investment management agreement,
distribution agreement and other agreements related to the management,
distribution or administration of any Fund or account managed by the Corporation
to which the Corporation is a party has been performed by the Corporation in
accordance with the terms of the agreement and applicable laws, other than as
disclosed to the Purchaser in writing on or prior to the date hereof.
4.19 CLIENTS
Except as disclosed to the Purchaser in writing on or prior to the date hereof,
the Corporation has not received any written notice during the period from June
30, 2000 to the date hereof, that any client or clients (other than unitholders
of the Funds managed by the Corporation) are terminating or are planning to
terminate their relationship with the Corporation or will withdraw more than
half of the assets they currently have invested with the Corporation.
<PAGE>
14
4.20 Outstanding Shares
As at the date of this Agreement, there are 6,948,750 Shares issued and
outstanding, and 201,000 options to purchase additional Shares outstanding (for
which the aggregate exercise price payable to the Corporation would be
$4,221,450 if all such options were to be exercised). There are no other equity
securities, warrants or securities convertible into equity securities, of the
Corporation presently outstanding and no person is entitled to acquire any such
securities pursuant to any pre-emptive right, agreement or understanding to
which the Corporation is a party.
4.21 UNITED STATES ASSETS AND REVENUES
The Corporation does not have assets in the United States of America with a book
value in excess of US$15 million or aggregate sales in or into the United States
of America during the Corporation's fiscal year ended December 31, 1999 in
excess of US$25 million.
ARTICLE 5
COVENANTS
5.1 CONDUCT OF BUSINESS OF THE CORPORATION
The Corporation covenants and agrees that, during the period from the date of
this Agreement to the earlier of (i) the time (the "Effective Time") of the
first appointment or election to the Board of Directors of the Corporation (the
"Board") of persons designated by the Purchaser or Offeror representing a
majority of the directors of the Corporation or (ii) the termination of this
Agreement, except as specifically provided for herein or unless the Purchaser or
Offeror shall otherwise agree in writing, the businesses of the Corporation
shall be conducted only in, and the Corporation shall not take any action except
in, the ordinary course of business and in a manner substantially consistent
with past practice and in compliance with applicable laws; and the Corporation
shall use its reasonable commercial efforts to preserve intact the business
organization of the Corporation and to preserve the current relationships of the
Corporation with customers, suppliers, lenders and other persons with which the
Corporation has business relations. By way of amplification and not limitation,
except with the prior written approval of the Purchaser (which approval shall
not be unreasonably withheld) or as specifically provided for herein, the
Corporation shall not, between the date of this Agreement and the earlier of the
Effective Time and termination of this Agreement, directly or indirectly do,
authorize or commit to do, or enter into any agreement, arrangement or
understanding with respect to:
(1) any action that would have, individually or in the
aggregate, a Material Adverse Effect:
(2) any acquisition or disposition of assets or securities,
other than (i) routine purchases of equipment, office
supplies or similar items in the ordinary course of
business, provided such purchases do not exceed $50,000
in the aggregate, or (ii) rollovers and substitutions
of investment certificates, term deposits, bankers'
<PAGE>
15
acceptances, money market instruments and funds and
other similar investments in the ordinary course;
(3) any change in its debt capitalization (including, but
not limited to, any increase in the amount of its
borrowings) or any conversion of short term borrowings
into long term borrowings;
(4) any capital expenditures exceeding $10,000 individually
or $50,000 in the aggregate;
(5) except pursuant to existing obligations or agreements
entered into during the period June 30, 2000 to the
date hereof, any dealings of any nature whatsoever
between it, on the one hand, and any of the Principal
Shareholders or any of their respective affiliates (or
any insider of any of the foregoing), on the other
hand;
(6) entering into, modifying or terminating any agreement
or arrangement with any of its Senior Officers or
employees, except for: (i) the termination or
cancellation of options, the acceleration of
outstanding options as a result of the Offer or the
repurchase for cancellation of each option that is
exercisable at $16.95 per share; or (ii) the hiring of
replacement employees;
(7) any release or relinquishment of any contractual
rights, except in the ordinary course of its business;
(8) agreeing or committing to guarantee the payment of
indebtedness of a third party;
(9) instituting, cancelling or modifying any pension plan
or other employee benefit arrangement;
(10) except as specifically provided for in Section 2.1(g),
declaring or paying any dividend or declaring,
authorizing or making any distribution of or on any of
its securities;
(11) the amendment of its articles or by-laws;
(12) the issuance or purchase or other acquisition of any
shares of its capital stock of any class or series or
of securities convertible into, or rights, warrants or
options to acquire, any such shares or other
convertible securities (other than pursuant to the
exercise, termination or cashing out of stock options
currently outstanding in accordance with their current
terms or as specifically provided for herein or in
accordance with the Corporation's employee share
ownership plan);
<PAGE>
16
(13) except as provided in section 5.4 or pursuant to the
exercise of options currently outstanding, any
take-over bid or tender offer (including without
limitation an issuer bid or self tender offer) or
exchange offer, merger, amalgamation, plan of
arrangement, reorganization, consolidation, business
combination, reverse take-over, sale of substantially
all its assets, sale of securities, recapitalization,
liquidation, dissolution, winding up or similar
transaction involving the Corporation or any other
transaction the consummation of which would or could
reasonably be expected to impede, interfere with,
prevent or delay the consummation of the Offer or which
would or could reasonably be expected to dilute the
benefits to the Offeror and the Purchaser of the
transactions contemplated by the Offer or any
Compulsory Acquisition or Subsequent Acquisition
Transaction;
(14) except for the payments required in connection with the
Corporation's retention of RBC Dominion Securities
Inc., as provided in Section 6.4 or as otherwise agreed
by the Purchaser, the payment of additional fees to
investment bankers; or
(15) the creation of any new Funds, amendment of any
declaration of trust or fund contract or the calling of
a meeting of unitholders.
5.2 BOARD OF DIRECTORS
Provided that at least 67.43% of the outstanding Shares are taken up and paid
for pursuant to the Offer, the Corporation shall as soon as practicable
thereafter use its commercially reasonable best efforts to cause all of the
directors of the Corporation to consist of persons designated or selected by the
Purchaser.
5.3 ACCESS TO INFORMATION
Subject to the Confidentiality Agreement, following commencement of the Offer,
the Corporation shall, and shall use reasonable commercial efforts to cause its
officers and directors to, and request its auditors and legal counsel to, afford
the officers, employees, auditors and other agents of the Purchaser and Offeror,
reasonable access at reasonable times to its officers and facilities, as
necessary, and to its books and records, and shall furnish the Purchaser, the
Offeror and such other persons with such financial, operating and other data and
information as the Purchaser, through its officers, employees or agents, may
from time to time reasonably request.
5.4 NO SOLICITATION
(a) The Corporation shall not, directly or indirectly, through any
officer, director, employee, representative or agent of the
Corporation, solicit or encourage (including by way of furnishing
information or entering into any form of agreement, arrangement or
understanding) the initiation of a Transaction Proposal provided
nothing contained in this Section 5.4 shall prevent the Corporation or
<PAGE>
17
its officers, contractors, employees, representatives or agents from
taking such actions as the Board determines are reasonably required in
the exercise of its fiduciary duties to respond to an unsolicited BONA
FIDE written Transaction Proposal for which adequate financing
arrangements have been made or are reasonably likely to be made, which
the Board determines in good faith (after consultation with its
financial advisors, and after receiving a written opinion of outside
counsel or advice of such outside counsel that is reflected in the
minutes of the Board, to the effect that the Board is required to do
so in order to discharge properly its fiduciary duties) would, if
consummated in accordance with its terms, result in a transaction more
favourable to the shareholders of the Corporation from a financial
point of view than the transaction contemplated by this Agreement (any
such Transaction Proposal being referred to herein as a "Superior
Proposal"); provided that in taking such actions the Board shall act
in accordance with subsection (d) below.
(b) Subject to the foregoing, the Corporation shall immediately cease and
cause to be terminated any existing discussions or negotiations with
any parties with respect to any potential Transaction Proposal other
than the Purchaser. The Corporation agrees not to release any third
party from any confidentiality or standstill agreement to which the
Corporation and such third party is a party, or consent to a
Transaction Proposal thereunder except as expressly contemplated in
this Agreement, and shall take reasonable steps to enforce such
confidentiality or standstill agreement. The Corporation shall
immediately instruct its advisors to request the return or destruction
of all information provided to any third parties who have entered into
a confidentiality agreement with the Corporation relating to a
potential Transaction Proposal and shall use all reasonable efforts to
ensure that such requests are honoured.
(c) The Corporation shall immediately notify the Purchaser of any future
Transaction Proposal or any written request for non-public information
relating to the Corporation in connection with a Transaction Proposal
or for access to the properties, books or records, of the Corporation
by any person or entity that informs any member of the board of
directors of the Corporation that it is considering making, or has
made, a Transaction Proposal. Such notice to the Purchaser shall be
made, from time to time, orally and in writing and shall indicate such
details of the proposal, inquiry or contact known to such person as
the Purchaser may reasonably request other than the identity of the
person making such proposal, inquiry or contact.
(d) The Corporation shall not permit any person making a Superior Proposal
to receive access to confidential information unless such person: (i)
has signed a substantially similar confidentiality agreement to that
entered into with the Purchaser; and (ii) has agreed with the
Corporation that it will not purchase, or agree to purchase, any
securities of the Corporation otherwise than through the consummation
of the Superior Proposal.
<PAGE>
18
5.5 FURTHER ACTION; COMMERCIALLY REASONABLE BEST EFFORTS
Upon the terms and subject to the conditions hereof, each of the parties hereto
shall use its commercially reasonable best efforts to take, or cause to be
taken, all appropriate action, and to do or cause to be done, all things
necessary, proper or advisable under applicable laws, including Securities Laws,
and regulations or otherwise to consummate and make effective the transactions
contemplated by this Agreement, including without limitation:
(a) co-operation in the preparation and filing of the Offer Documents and
the Directors' Circular and any regulatory and governmental, filings
or submissions, including under the COMPETITION ACT (Canada), the
INVESTMENT CANADA ACT or the comparable laws of any other relevant
jurisdiction, and any amendments to any such filings. The Corporation
agrees that it shall file a material change report in respect of this
Agreement as required under the Securities Laws which may include a
copy of this Agreement;
(b) to diligently make all required regulatory filings and applications
and to obtain all licences, permits, consents, approvals,
authorizations, qualifications and orders of governmental authorities
and parties to contracts with the Corporation as are necessary for the
consummation of the transactions contemplated by this Agreement and to
fulfil the conditions to the Offer, including without limitation the
regulatory notice requirements, consents and regulatory approvals
referred to in Schedule "C"; and
(c) in respect of the Corporation, to assist in securing the release of
the common shares escrowed pursuant to the Bissett Escrow Agreement
for deposit under the Offer.
5.6 REGULATORY APPROVALS
The Offeror shall diligently take such steps as are necessary to satisfy the
conditions expressly provided for in Section 3 of Schedule "B" hereto and shall
file all notices in connection therewith no later than the fifth business day
following the date the Offer is made, and shall keep the Corporation informed
with respect to the status of applications for all such approvals, including
providing all relevant documentation to the Corporation to allow it to assess
the status of such applications. The Corporation shall provide its co-operation
and assistance to the Purchaser and the Offeror in connection with satisfying
such conditions. The Corporation shall pursue any and all regulatory approvals
or other filings required on the part of the Corporation with respect to the
Offer and shall file all notices in connection therewith no later than the fifth
business day following the date the Offer is made.
5.7 TAKE UP AND PAYMENT
Subject to the satisfaction or waiver of the conditions set forth in the Offer,
the Offeror shall, within three business days following the date that the
conditions set forth in the Offer are satisfied or waived and the Offeror is
duly authorized under applicable law, accept for payment and pay for all Shares
validly deposited (and not properly withdrawn) pursuant to the Offer.
<PAGE>
19
5.8 INCREASE IN CONSIDERATION
The Offeror covenants that, in the event the Offeror increases the consideration
per Share offered under the Offer (excluding any greater consideration paid as a
result of any proceeding in respect of fair value under the ABCA or any other
Subsequent Acquisition Transaction), the Offeror will pay such increased
consideration to each Shareholder in respect of all Shares tendered,
notwithstanding that such Shares have previously been taken up and paid for by
the Offeror.
5.9 SUBSEQUENT ACQUISITIONS
If the Offeror takes up and pays for Shares pursuant to the Offer and thereby
acquires more than 50% of the outstanding Shares, the Offeror will use its
commercially reasonable best efforts, and the Corporation agrees to assist the
Offeror, to acquire the balance of the Shares as soon as practicable following
the take-up date by way of Compulsory Acquisition or Subsequent Acquisition
Transaction, subject to requisite regulatory and shareholder approvals.
5.10 FURTHER COVENANTS
The Offeror and the Purchaser agree that:
(a) if the Offeror takes up Shares pursuant to the Offer, the Offeror and
the Purchaser will cause the Corporation to fulfil its obligations
pursuant to indemnities available to past and present officers and
directors of the Corporation pursuant to the provisions of the ABCA,
the by-laws of the Corporation or any written indemnity agreements
entered into between the Corporation and such persons; and
(b) if the Offeror takes up Shares pursuant to the Offer, the Offeror and
the Purchaser agree to use commercially reasonable efforts to secure
directors' and officers' liability insurance for the Corporation's
current and former directors and officers (whether such insurance is
maintained independently of or included under the Purchaser's
directors' and officers' insurance policy), covering claims made prior
to or within six years after the date that the Offeror first takes up
and pays for any Shares pursuant to the Offer; provided however that
the aggregate cost of such coverage shall not exceed $75,000 (the
"Aggregate Insurance Amount") and, if such coverage can only be
obtained by paying an aggregate premium in excess of such amount, the
Purchaser shall use its commercially reasonable best efforts to obtain
as much comparable insurance as is available for the Aggregate
Insurance Amount. The scope and coverage of such directors' and
officers' insurance shall be equivalent in scope and coverage to that
provided by the Corporation's current directors' and officers'
insurance policy.
Prior to making the Offer, the Offeror and the Purchaser agree to
provide a covenant in favour of each party to an indemnity agreement and in
favour of each of the past and present directors and officers of the Corporation
to comply with the foregoing.
<PAGE>
20
5.11 TAKE-UP AND PAYMENT FOR SHARES
It covenants and agrees that the Offeror will not take up and pay for any Shares
pursuant to the Offer until a period of 60 days shall have elapsed from the date
that the Mutual Fund Notice is given to securityholders of Funds managed by the
Corporation as prescribed by Section 5.8 of National Instrument 81-102.
5.12 CLIENTS
The Corporation will advise the Purchaser as soon as practicable after receiving
written notice from any client or clients (other than unitholders of the Funds
managed by the Corporation) that any such client is terminating or planning to
terminate its relationship with the Corporation or will withdraw more than half
of the assets they then have invested with the Corporation.
ARTICLE 6
TERMINATION, AMENDMENT AND WAIVER
6.1 TERMINATION
This Agreement may be terminated at any time prior to the Effective Time:
(a) by the Corporation, the Purchaser or the Offeror if any court of
competent jurisdiction or other governmental body located or having
jurisdiction within Canada shall have issued a final order, decree or
ruling or taken any other final action restraining, enjoining or
otherwise prohibiting the Offer and such order, decree, ruling or
other action is or shall have become final and non-appealable;
PROVIDED that such right of termination shall not be available to any
party if such party shall have failed to make reasonable efforts to
prevent or contest the imposition of such injunction or action and if
such party's failure materially contributed to such imposition;
(b) by the Corporation if (i) the Offer has not been made by the date
required in paragraph 2.1(a) hereof; (ii) the Offer (or any amendment
thereto other than as specifically provided for in Schedule "B" hereto
or any amendment thereof that has been mutually agreed to by the
parties) does not conform in all material respects with the
description in Schedule "B" or any amendment thereof that has been
mutually agreed to by the parties; (iii) Shares deposited under the
Offer have not, for any reason whatsoever, been taken up on or before
75 days after the date of the mailing of the Offer to Shareholders of
the Corporation, provided that if the Purchaser is precluded from so
taking up and paying as a result of any breach by the Corporation of
its obligations under this Agreement, such 75 day period shall be
deemed extended to the 3rd business day following the date upon which
the Purchaser is no longer so precluded provided that in no event
shall the period be extended for more than 30 days (such 75th day, as
so extended, being herein referred to as the "Expiry Deadline"); (iv)
the Offer has been terminated, withdrawn or otherwise expires in
accordance with its terms; (v) there shall have been a material breach
of any covenant, representation or warranty on the part of the
<PAGE>
21
Purchaser or the Offeror contained herein; or (vi) a Superior Proposal
has been consummated which results in at least a majority of the
outstanding Shares being acquired;
(c) by the Purchaser or the Offeror if: (i) the Offer has been terminated,
withdrawn or otherwise expires in accordance with its terms; (ii)
there shall have been a breach of any representation or warranty on
the part of the Corporation contained herein that has a Material
Adverse Effect; (iii) there shall have been a breach of any covenant
or agreement on the part of the Corporation contained herein that has
a Material Adverse Effect; (iv) the Board shall have withdrawn or
modified (including by amendment of the Directors' Circular) in a
manner adverse to the Purchaser or the Offeror its approval or
recommendation of the Offer, this Agreement or the transactions
contemplated hereby (provided that such withdrawal or modification is
not due to a material misrepresentation made by the Offeror or the
Purchaser) or shall have approved or recommended a Transaction
Proposal, or shall have resolved to effect any of the foregoing; or
(v) the fee specifically provided for in Section 6.3 is payable.
6.2 EFFECT OF TERMINATION
In the event of the termination of this Agreement pursuant to Section 6.1, this
Agreement shall forthwith become void and there shall be no liability on the
part of any party hereto or their respective shareholders, officers or directors
except as expressly provided herein and; PROVIDED, HOWEVER, that nothing herein
shall relieve any party from liability for any breach of any provision of this
Agreement which occurred on or before the date of such termination.
Notwithstanding the foregoing, if this Agreement is terminated the Corporation's
obligations to the Purchaser pursuant to Section 6.3 continues in full force and
effect. The termination of this Agreement shall not affect the obligations of
the parties under the Lock-Up Agreements or the Confidentiality Agreement. In
the event of termination of this Agreement, each of the parties shall forthwith
return to the other all confidential or other information relating to such
party.
6.3 FEES
Provided that the Offer is made, if the Offeror does not complete an acquisition
of any Shares except as a result of a breach by the Purchaser or the Offeror of
a provision of this Agreement, in the event that a Superior Proposal is
announced, commenced or made at any time prior to the expiry of the Offer and at
the expiry of the Offer (a) the Superior Proposal is still outstanding, and (b)
the Minimum Condition is not satisfied, and the Superior Proposal is thereafter
completed and at least a majority of the outstanding Shares are acquired under
the Superior Proposal (whether before or after the expiry of the Offer), the
Corporation will pay to the Purchaser forthwith upon completion of the
transaction contemplated by such Superior Proposal, a fee of $2,800,000.
6.4 COMMISSIONS
The Corporation represents and warrants to the Purchaser that it has not
retained any financial advisor or finder in connection with this Agreement and
that no person or entity is entitled to any financial advisory or finder fee,
<PAGE>
22
commission or other compensation on account of any such dealings with the
Corporation other than RBC Dominion Securities Inc. The Corporation has agreed
to pay an advisory fee to RBC Dominion Securities Inc. pursuant to an agreement
dated June 30, 2000, a copy of which has been provided to the Purchaser.
6.5 WAIVER
At any time prior to the Effective Time, any party hereto may: (a) extend the
time for the performance of any of the obligations or other acts of the other
parties hereto; (b) waive any inaccuracies in the representations and warranties
contained herein or in any document delivered pursuant hereto that are for the
benefit of such party; and (c) waive compliance with any of the agreements or
conditions contained herein that are for the benefit of such party. Any such
extension or waiver shall be valid if set forth in an instrument in writing
signed by the party or parties to be bound thereby.
ARTICLE 7
GENERAL PROVISIONS
7.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS
The representations, warranties and agreements in this Agreement shall survive
the consummation of the Offer but only for a period of one year after the date
of this Agreement.
7.2 NOTICES
Any notice, direction or other instrument required or permitted to be given
hereunder shall be in writing and given by delivering or sending it by facsimile
or other similar electronic form of communication addressed:
(a) if to the Purchaser or the Offeror:
Franklin Resources, Inc.
777 Mariners Island Blvd.
San Mateo, California
94404
Attention: Martin Flanagan
Telephone No.: (650) 312-2000
Fax No.: (650) 312-3528
with a copy to:
Les M. Kratter, Esq., Senior Vice President
Telephone No.: (650) 312-4018
Fax No.: (650) 312-2804
<PAGE>
23
and to:
Templeton Management Limited
1 Adelaide Street East
Suite 2101
Toronto, Ontario
M5C 3B8
Attention: Donald Reed, President & Chief Executive
Officer
Telephone No.: (416) 957-6000
Fax No.: (416) 360-0481
and to:
Osler, Hoskin & Harcourt LLP
P.O. Box 50
1 First Canadian Place
Toronto, Ontario
M5X 1B8
Attention: Deborah M. Alexander
Telephone No.: (416) 862-6573
Fax No.: (416) 862-6666
(b) if to the Corporation:
Bissett & Associates Investment Management
Ltd.
3100, 350 - 7th Avenue S.W.
Calgary, Alberta
T2P 3N9
Attention: Kevin W. Wolfe, President and Chief
Executive Officer
Telephone No.: (403) 266-4668
Fax No. : (403) 237-2334
with a copy to:
Burnet, Duckworth & Palmer
1400, 350 - 7th Avenue S.W.
Calgary, AB
Attention: Jay P. Reid
Telephone No.: (403) 260-0340
Fax No.: (403) 260-0330
<PAGE>
24
Any such notice, direction or other instrument given as aforesaid shall be
deemed to have been effectively given, if sent by telecopier or other similar
electronic form of communication, on the business day such transmission is
received or, if delivered, to have been received on the date of such delivery.
Any party may change its address for service from time to time by notice given
in accordance with the foregoing and any subsequent notice shall be sent to the
party at its changed address.
7.3 SEVERABILITY
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner adverse to any party. Upon
such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the fullest extent possible.
7.4 ENTIRE AGREEMENT; ASSIGNMENT
This Agreement, together with the Confidentiality Agreement constitutes the
entire agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements and undertakings, both written and oral, among
the parties, or any of them, with respect to the subject matter hereof. This
Agreement shall not be assigned by operation of law or otherwise, except that
the Purchaser may assign all or any of its rights and obligations hereunder to
any direct or indirect subsidiary of the Purchaser, PROVIDED that no such
assignment shall relieve the Purchaser of its obligations hereunder if such
assignee does not perform such obligations. The Purchaser shall cause the
Offeror to comply with all of the Offeror's obligations under this Agreement and
the Purchaser shall be fully liable to the Corporation for any breach by the
Offeror of any provision of this Agreement or the Offer as if it was the Offeror
thereunder.
7.5 TIME
Time shall be of the essence of this Agreement.
7.6 URRENCY
All sums of money referred to in this Agreement (except, for greater certainty,
the U.S. funds amount set out in Section 4.21) shall mean Canadian funds.
7.7 AMENDMENTS
This Agreement may not be modified, amended, altered or supplemented except upon
the execution and delivery of a written agreement executed by all of the parties
hereto.
<PAGE>
25
7.8 EXPENSES
Other than as provided in section 6.3 hereof, all fees, costs and expenses
incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such cost or expense, whether or not
the Offer is consummated.
7.9 COUNTERPARTS
This Agreement may be executed in one or more counterparts which together shall
be deemed to constitute one valid and binding agreement and delivery of the
counterparts may be effected by means of a telecopied transmission. This
Agreement may be executed by facsimile signature, and execution thereby will
constitute an original hereof.
7.10 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of
the Province of Alberta and the laws of Canada applicable therein.
7.11 PUBLIC STATEMENTS
None of the Purchaser, the Offeror, the Corporation or their respective
directors, officers, employees or representatives shall make any public
statement or announcement with respect to the Offer or this Agreement which is
inconsistent with the terms and conditions of the Offer or this Agreement. All
press releases with respect to this Agreement shall require the approval of the
Purchaser and the Corporation.
<PAGE>
26
IN WITNESS WHEREOF, the Purchaser, the Offeror and the Corporation have caused
this Agreement to be executed as of the date first written above by their
respective duly authorized officers.
FRANKLIN RESOURCES, INC.
By:/s/ Leslie M. Kratter
--------------------------------
Name:Leslie M. Kratter
Title:Senior Vice President
FTI ACQUISITION INC.
By:/s/ Michael S. J. Mezei
---------------------------------
Name: Michael S. J. Mezei
Title: Secretary
BISSETT & ASSOCIATES INVESTMENT
MANAGEMENT LTD.
By:/s/ Kevin W. Wolfe
--------------------------------
Name: Kevin W. Wolfe
Title: President and Chief Executive
Officer
<PAGE>
SCHEDULE "A"
PRINCIPAL SHAREHOLDERS
Belmont Capital Management Ltd.
Guest Holdings Ltd.
571770 Alberta Ltd.
604478 Alberta Inc.
<PAGE>
SCHEDULE "B"
TERMS OF THE OFFER
1. GENERAL TERMS.
The Offer shall be made as soon as reasonably practicable, but in any event, not
later than August 15, 2000, by a circular bid to all registered holders of
Shares prepared in compliance with applicable Securities Laws and in each case
in compliance with the rules, regulations and policy statements published
thereunder. The Offer shall expire no later than the Expiry Deadline.
Upon the terms and subject to the conditions of the Offer, the Purchaser will
cause the Offeror to accept for payment, and to take up and pay for, all Shares
of the Corporation deposited and not withdrawn under the Offer within three (3)
business days of being legally able to do so.
The Purchaser shall have the right to vary the terms of the Offer to effect,
including among other things, one or more of the following:
(i) increase the consideration offered for the Shares;
(ii) extend the period during which Shares may be deposited to the
Offer, provided that in no event shall the Offer extend beyond
the Expiry Deadline;
(iii)waive any condition of the Offer, provided that it will not
reduce the Minimum Condition contained in paragraph 3(a) hereof
to below 50% of the Shares without the consent of the
Corporation; and
(iv) with the prior written consent of the Corporation, comply with
applicable Securities Laws.
provided however that, without the prior written consent of the Corporation, the
Purchaser shall not:
(a) reduce or change the form of the consideration to be offered pursuant
to the Offer,
(b) impose any additional conditions to the Offer, or
(c) make any other change to the Offer that is adverse to the holders of
Shares.
2. PRICE OF THE OFFER.
The Offer Price shall be $20.50 per Share payable in cash.
3. CONDITIONS OF THE OFFER.
The Offer shall not be subject to any conditions other than the following:
<PAGE>
2
(a) that there are validly deposited under the Offer and not withdrawn at
the expiration thereof not less than 67.43% of the Shares, including
the Shares deposited by the Principal Shareholders (the "Minimum
Condition");
(b) any applicable waiting periods under any applicable competition,
merger control or similar law, rule, regulation, or policy shall have
terminated or expired and any approval or consent of any governmental
or regulatory authority having jurisdiction over any party hereto or
the Offer, any Compulsory Acquisition or Subsequent Acquisition
Transaction, including without limitation the consents and regulatory
approvals listed on Schedule "C" to the Acquisition Agreement, shall
have been obtained, on terms and conditions satisfactory to the
Offeror, acting reasonably, in respect of the Offer and Transaction;
(c) (i) no act, action, suit or proceeding shall have been threatened or
taken before or by any domestic or foreign arbitrator, court or
tribunal or governmental agency or other regulatory authority or
administrative agency or commission by any elected or appointed public
official or private person (including, without limitation, any
individual, corporation, firm, group or other entity) in Canada or
elsewhere, whether or not having the force of law, and (ii) no law,
regulation or policy shall have been proposed, enacted, promulgated or
applied, in either case:
(A) to cease trade, enjoin, prohibit or impose material
limitations or conditions on the right of the Offeror to own
or exercise full rights of ownership over the Shares or the
consummation of any of the transactions contemplated by the
Offer or, to prevent the completion of any Compulsory
Acquisition or Subsequent Acquisition Transaction or which
could reasonably be expected to have such an effect; or
(B) to prohibit or materially limit the ownership or operation
by the Corporation, or by the Offeror or the Purchaser,
directly or indirectly, of all or any material portion of
the business or assets of the Corporation, on a consolidated
basis, or the Offeror or the Purchaser as a result of the
transactions contemplated by the Offer or any Compulsory
Acquisition or Subsequent Acquisition Transaction or compel
the Offeror or the Purchaser, directly or indirectly, to
dispose of or hold separate all or any material portion of
the business or assets of the Corporation, on a consolidated
basis, or the Offeror or the Purchaser as a result of the
transactions contemplated by the Offer,
(d) there shall not exist any prohibition at law against the Offeror
making the Offer, taking up and paying for 100% of the Shares under
the Offer, or consummating any Compulsory Acquisition or Subsequent
Acquisition Transaction;
(e) there shall not have occurred (or if there shall have occurred prior
to the date hereof, there shall not have been generally disclosed or
the Purchaser shall not otherwise discover, if not previously
<PAGE>
3
disclosed to the Purchaser in writing prior to the commencement of the
Offer) any Material Adverse Effect;
(f) all outstanding rights or entitlements of any type whatsoever to
purchase or otherwise acquire authorized and unissued Shares shall
have been exercised in full or irrevocably released, surrendered,
terminated and waived by the holders thereof or may be released,
terminated, surrendered or waived on a basis acceptable to the Offeror
in its sole judgment, acting reasonably;
(g) the representations and warranties of the Corporation provided in the
Acquisition Agreement shall be, as of the date made and as of the date
the Offeror takes up Shares, true and correct and the Corporation
shall have complied with any covenants or agreements to be complied
with by it under the Acquisition Agreement, except if the failure of
the representations, warranties, covenants or agreements does not, in
the aggregate, have a Material Adverse Effect or would not materially
adversely affect the ability of the Offeror to consummate the Offer
and any Compulsory Acquisition or Subsequent Acquisition Transaction;
(h) none of:
(i) the signatories to the Lock-Up Agreements other than the
Purchaser shall have breached the Lock-Up Agreements, if such
breach would materially adversely affect the Offeror or its
ability to consummate the Offer;
(ii) Ms. Grant and Messrs. Pynn, Quinn and Wolfe shall have repudiated
his or her Employment Agreement;
(iii)Mr. Guest and Mr. Bissett shall have repudiated his
Non-Competition Agreement; or
(iv) the Principal Shareholders who are signatories to the Escrow
Agreement shall have repudiated the Escrow Agreement;
(i) at the time the Offeror takes up any Shares, the total assets under
management by the Corporation shall not be less than $3.89 billion (as
determined on a basis consistent with the determination of total
assets of $5.74 billion under management as at June 30, 2000, as
disclosed to the Purchaser in writing prior to the date hereof), which
$3.89 billion of assets shall not include the assets for which a
written notice of withdrawal has been received by the Corporation; and
(j) the Shares deposited in escrow under the Bissett Escrow Agreement
shall be releasable for tender into the Offer on terms and conditions
satisfactory to the Purchaser, acting reasonably.
The foregoing conditions are for the exclusive benefit of the Offeror and may
be asserted by the Offeror regardless of the circumstances (including any
action or inaction by the Offeror) giving rise to such assertion or may be
waived by the Offeror in whole or in part at any time and from time to
time, in its sole discretion and shall be exclusive of any other right
<PAGE>
4
which the Offeror may have under the Offer. The failure by the Offeror at
any time to exercise or assert any of the foregoing rights shall not be
deemed to constitute a waiver of any such right, the waiver of any such
right with respect to particular facts or other circumstances shall not be
deemed a waiver with respect to any other facts and circumstances and each
such right shall be deemed an on-going right which may be asserted at any time
and from time to time by the Offeror. Any determination by the Offeror
concerning the foregoing conditions shall be final and binding upon all parties.
<PAGE>
SCHEDULE "C"
REGULATORY NOTICE REQUIREMENTS, CONSENTS
AND REGULATORY APPROVALS
I. SECURITIES LAWS APPROVALS
A. BRITISH COLUMBIA
1. Section 42(2) - notice to Commission by the Corporation within (Act)5
business days of change of holders of voting
securities /1/
2. SECTION 16(1) - APPLICATION TO COMMISSION BY THE CORPORATION
(RULES) FOR APPROVAL FOR THE CORPORATION TO HAVE AN
INTEREST IN ANY OTHER DEALER OR ADVISER (DUE TO
SECTION 1(4) OF THE ACT THE CORPORATION WILL BE
DEEMED TO HAVE AN INTEREST IN THE ACQUIROR AND ITS
AFFILIATES FOR PURPOSES OF THIS SECTION)
3. Section 52 - notice to clients by the Corporation of change
(Rules) of control and of right of client to close or
transfer account - this notice includes all clients
with whom the Corporation has an investment management
agreement but not investors in mutual funds or
pooled funds unless the investment is made pursuant to
an investment management agreement
4. SECTION 73 - NOTICE TO COMMISSION BY THE CORPORATION
(RULES) IMMEDIATELY OF PROPOSED CHANGE OF CONTROL OF
10% OR MORE OF VOTING SECURITIES
B. ALBERTA
1. Section 63(2) - notice to Commission by the Corporation within
(Act) 5 business days of change of holders of voting
securities /2/
2. Section 21 - similar to section 16(1) in British Columbia
(Rules) Rules but not applicable because relates to
registrants acquiring registrants and the
Acquiror and its affiliates are not
registrants in Alberta
----------------------------------------
/1/ The Corporation as a reporting issuer may be exempt from this
requirement if an exemption has been applied for and received but
the terms of the exemption, if there is one, would have to be reviewed
to determine if they apply.
/2/ The Corporation as a reporting issuer may be exempt from this
requirement if an exemption has been applied for and received but
the terms of the exemption, if there is one, would have to be reviewed
to determine if they apply.
<PAGE>
2
3. Section 31(5) - notice to clients by the Corporation of change
(Rules) of control and of right of client to close or
transfer account - this notice includes all clients
with whom the Corporation has an investment management
agreement but not investors in mutual funds or
pooled funds unless the investment is made pursuant to
an investment management agreement
4. Section 48 - any changes to Form 3 not reported under
(Rules) section 63(2) of the Act must be reported
within 10 days of the change
C. MANITOBA
1. Section 15(3) - notice to Commission by the Corporation within
(Act) 5 business days of change of holders of a
voting securities /3/
D. ONTARIO
1. Section 33 - notice to Commission by the Corporation within
(Act) 5 business days of change of holders of a
voting securities /4/
2. SECTION 104 - A REGISTRANT MUST RECEIVE APPROVAL TO ACQUIRE
(REGULATIONS) A DIRECT OR INDIRECT INTEREST IN ANOTHER
REGISTRANT AT LEAST 30 DAYS BEFORE THE
ACQUISITION
- DUE TO SECTION 1(5) OF THE ACT, THE
ACQUISITION WILL BE DEEMED TO BE BY THE
AFFILIATE REGISTRANT EVEN IF IT IS BY THE
ACQUIROR
3. Section 115(5) - notice to clients of change of control and of
(Regulations) right to withdraw account - this notice
includes all clients with whom the Corporation
has an investment management agreement but not
investors in mutual funds or pooled funds unless
the investment is made pursuant to an investment
management agreement
4. SECTION 217 - NOTICE TO COMMISSION BY THE CORPORATION OF
(REGULATIONS) PROPOSED CHANGE OF CONTROL OF 10% OR MORE OF
VOTING SECURITIES
In addition if the Corporation is the manager of mutual funds which are subject
to NI 81-102 the following approval and notice under NI 81-102 are necessary:
--------
/3/ The Corporation as a reporting issuer may be exempt from
this requirement if an exemption has been applied for and
received but the terms of the exemption, if there is one,
would have to be reviewed to determine if they apply.
/4/ The Corporation as a reporting issuer may be exempt from
this requirement if an exemption has been applied for and
received but the terms of the exemption, if there is one,
would have to be reviewed to determine if they apply.
<PAGE>
3
1. SECTION 5.5(2) - APPROVAL OF THE SECURITIES REGULATORY
AUTHORITY FOR THE CHANGE OF CONTROL
2. SECTION 5.8 - 60 DAYS PRIOR NOTICE TO SECURITY HOLDERS OF
THE MUTUAL FUNDS OF THE CHANGE OF CONTROL
II. OTHER APPROVALS
A.1. INVESTMENT CANADA ACT: determination by the Minister
responsible for Investment Canada under the INVESTMENT CANADA ACT
(Canada) that the Minister is satisfied that the acquisition is
likely to be of "net benefit to Canada" for purposes of such Act.
<PAGE>
SCHEDULE "D"
FUNDS
MUTUAL FUNDS
Bissett American Equity Fund
Bissett Bond Fund
Bissett Canadian Equity Fund
Bissett Dividend Income Fund
Bissett Income Trust Fund
Bissett InternationalEquity Fund
Bissett Large Cap Fund
Bissett Microcap Fund
Bissett Money Market
Fund Bissett Multinational Growth Fund
Bissett Retirement Fund
Bissett Small Cap Fund
POOLED TRUSTS
Bissett American Bond Trust
Bissett Balanced RRSP Trust
Bissett Balanced Tax Effective Trust
Bissett Canadian Growth Trust
Bissett Core Equity Trust
Bissett Pooled Equity Trust
<PAGE>
SCHEDULE "E"
DEFINITIONS
"ABCA" means the BUSINESS CORPORATIONS ACT (Alberta);
"affiliate" has the meaning ascribed thereto in the ABCA;
"associate" has the meaning ascribed thereto in the ABCA;
"business day" shall mean a day other than a Saturday, Sunday or other day on
which (i) commercial banks in Calgary or Toronto, Canada are authorized or
required by law, regulation or executive order to close or (ii) the New York
Stock Exchange is not open for trading;
"Canadian generally accepted accounting principles" shall mean the generally
accepted accounting principles in Canada from time to time approved by the
Canadian Institute of Chartered Accountants;
"Compulsory Acquisition" means the acquisition by the Offeror,
pursuant to Part 16 of the ABCA, of the remainder of the Shares
not tendered to the Offer;
"Fund" means a mutual fund as defined under the OSA;
"Governmental Authorities" means any government, regulatory authority,
governmental department, agency, commission, board, tribunal, crown corporation,
or court or other law, rule or regulation-making entity having or purporting to
have jurisdiction on behalf of any nation, or province or state or other
subdivision thereof or any municipality, district or other subdivision thereof;
"Material Adverse Effect", when used in connection with the Corporation, means
any change, effect, event or occurrence with respect to its condition (financial
or otherwise), properties, assets, liabilities, obligations (whether absolute,
accrued, conditional or otherwise), business, operations or results of
operations that is material and adverse to the business, operations or financial
condition of the Corporation, other than any change, effect, event or occurrence
(i) relating to the Canadian or United States economy or securities market in
general, (ii) affecting the Canadian or United States fund management industry
or investment management industry in general, (iii) relating to any changes in
assets under management by the Corporation in relation to or resulting from
changes in the Canadian or United States economy or securities markets in
general, unless the total assets under management by the Corporation shall be
less than $3.89 billion (as determined on a basis consistent with the
determination of total assets of $5.74 billion under management as at June 30,
2000, as previously disclosed to the Purchaser in writing prior to the date
hereof), which $3.89 billion of assets shall not include the assets for which a
written notice of withdrawal has been received by the Corporation, or (iv) that
occurs as a result of any matter consented to by or approved by the Offeror or
the Purchaser or as specified in this Agreement;
"Material Change" has the meaning ascribed to it in the OSA;
<PAGE>
2
"Material Contract" means:
(a) any contract which imposes a purchase right or right of first refusal
or security interest in any asset of the Corporation;
(b) any warranty or guaranty creating an obligation, contingent or
otherwise, given to any client or other party by the Corporation with
respect to any of the Corporation's services or products for an amount
greater than $25,000;
(c) any contract under which the Corporation or any of the Corporation's
affiliates has acquired or licensed any real or personal property or
assets of a third party or under which the Corporation or any of its
affiliates otherwise uses any properties or assets of another party or
which are jointly owned by the Corporation or any of its affiliates
with any other party or parties, in each case involving property or
assets having a value of more than $100,000, or aggregate payments of
more than $100,000;
(d) any agreement between the Fund and the Corporation;
(e) any investment advisory agreement for assets under management in
excess of $25,000,000;
(f) any other contract which provides for aggregate annual payments to or
from the Corporation having an aggregate value of $100,000 or more or
having a term of more than one year;
(g) any contract which requires aggregate annual future payments or
expenditures or having a term of more than one year that relates to
cleanup, abatement or other actions in connection with environmental
liabilities;
(h) a contract containing a covenant limiting the freedom of the
Corporation to engage in any line of business similar to the business
currently conducted by it or to compete with any person or entity in a
similar business;
(i) an employment, severance or consulting contract with an employee or
former employee of the Corporation;
(j) a collective bargaining agreement relating to the Employees;
(k) a contract for capital expenditures or the acquisition or construction
of fixed assets which requires future payments in excess of $25,000;
(l) a licence to use computer software (other than off-the-shelf software
marketed to the public generally) used or held for use by the
Corporation and involving aggregate payments of more than $100,000 or
having a term of more than one year;
<PAGE>
3
(m) a contract to which the Corporation is a party, a breach or default
under which could reasonably be expected to have a Material Adverse
Effect; or
(n) any contract which is otherwise material to the business and
operations of the Corporation.
"Material Fact" has the meaning ascribed to it in the OSA;
"Minimum Condition" means the condition set forth in section 3(a)of Schedule
"B";
"Misrepresentation" has the meaning ascribed to it in the OSA;
"OSA" means the SECURITIES ACT (Ontario);
"Reports" has the meaning ascribed thereto in Section 4.5;
"Senior Officers of the Corporation" means the President and
Chief Executive Officer, the Executive Vice-President and Chief
Operating Officer, the Vice-President, General Counsel and
Secretary, Senior Vice-president and the Chief Financial Officer
and the Vice-President and Treasurer;
"Subsequent Acquisition Transaction" means an amalgamation, statutory
arrangement or other transaction for the purposes of enabling the Offeror to
acquire all of the Shares not deposited under the Offer;
"Subsidiary" has the meaning ascribed to it in the OSA;
"Transaction Proposal" means any take-over bid, tender offer or exchange offer
other than the Offer (which bid or offer, is for at least a majority of the
outstanding Shares on a fully diluted basis), merger, amalgamation, plan of
arrangement, reorganization, consolidation, business combination, reverse
take-over, sale of assets (other than in the ordinary course of business), sale
of securities (other than pursuant to the exercise of currently outstanding
options and share purchase plans), recapitalization, liquidation, dissolution,
winding-up or similar transaction involving the Corporation.
