========================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM 8-A/A
------------------
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
HOMESTAKE MINING COMPANY
(Exact name of Registrant as specified in its charter)
DELAWARE 94-2934609
(State of incorporation or organization) (I.R.S. Employer
Identification No.)
650 California Street
San Francisco, California 94108-2788
(Address, including zip code, of principal executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
Rights to Purchase New York Stock Exchange
Series A Participating Cumulative
Preferred Stock
If this Form relates to the registration of a class of debt
securities and is effective upon filing pursuant to General Instruction
A.(c)(1), please check the following box. [ ]
If this Form relates to the registration of a class of debt
securities and is to become effective simultaneously with the effectiveness
of a concurrent registration statement under the Securities Act of 1933
pursuant to General Instruction A.(c)(2), please check the following box.
[ ]
Securities to be registered pursuant to Section 12(g) of the Act:
None
(Title of class)
========================================================================
<PAGE>
Item 1. Description of Securities to be Registered.
At a meeting of the Homestake Mining Company (the "Company")
Board of Directors on September 10, 1998, the Board approved the Company's
acquisition of the 49.4% interest in Prime Resources Group Inc. ("Prime")
not owned by Homestake Canada Inc., a wholly owned subsidiary of the
Company ("HCI"), pursuant to an Arrangement under British Columbia law. On
December 1, 1998, the shareholders of Prime approved a resolution in favor
of the Arrangement, and the stockholders of the Company approved
resolutions to amend the Company's Restated Certificate of Incorporation to
accommodate the Arrangement. On December 2, 1998, the British Columbia
Supreme Court issued the Final Order, which constitutes its approval of the
Arrangement. The Arrangement became effective on December 3, 1998, upon the
filing of the Final Order with the Registrar of Companies for British
Columbia.
Pursuant to the Arrangement, shareholders of Prime had the option
to receive for their Prime Common Shares either Common Stock of the Company
or Exchangeable Shares of HCI. Prime shareholders not exercising the option
on or before November 30, 1998, received HCI Exchangeable Shares. Each HCI
Exchangeable Share issued in the Arrangement is accompanied by and trades
with an associated right (an "HCI Right") pursuant to the Rights Agreement
dated as of December 3, 1998, between HCI, the Company and Montreal Trust
Company of Canada, as Rights Agent (the "HCI Rights Agreement"). The HCI
Rights are intended to have characteristics essentially equivalent in
economic effect to the rights under the Homestake Rights Agreement (as
defined below).
On September 24, 1998, the Board authorized the amendment of
certain terms of the Rights Agreement dated as of October 16, 1987, and
amended as of October 15, 1997, between the Company and BankBoston N.A., as
successor Rights Agent (as amended, the "Homestake Rights Agreement").
These amendments, which took effect as of December 3, 1998, make certain
changes in definitions and add certain definitions to reflect the existence
of the HCI Exchangeable Shares and the HCI Rights.
The HCI Rights Agreement is attached hereto as Exhibit 5, which
is incorporated herein by reference. The amendment to the Homestake Rights
Agreement is attached hereto as Exhibit 6, which is incorporated herein by
reference. The foregoing description of the agreement and the amendments
does not purport to be complete and is qualified in its entirety by
reference to those Exhibits.
Item 2. Exhibits.
Item 2 is amended by adding thereto the following:
5. Rights Agreement dated as of December 3, 1998, between
Homestake Canada Inc., Homestake Mining Company and Montreal
Trust Company of Canada, as Rights Agent.
6. Amendment No. 2 dated as of December 3, 1998, to the Rights
Agreement dated as of October 16, 1987, and amended as of
October 15, 1997, between Homestake Mining Company and
BankBoston N.A., as successor to Bank of America National
Trust and Savings Association, as Rights Agent.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized.
HOMESTAKE MINING COMPANY,
by
/s/ WAYNE KIRK
---------------------------------
Date: December 4, 1998 Name: Wayne Kirk
Title: Vice President, General Counsel
and Corporate Secretary
<PAGE>
INDEX OF EXHIBITS
Page Number
in
Sequentially
Exhibit Numbered
Number Title Statement
5. Rights Agreement dated as of December 3,
1998, between Homestake Canada Inc.,
Homestake Mining Company and Montreal
Trust Company of Canada, as Rights
Agent.
6. Amendment No. 2 dated December 3, 1998,
to the Rights Agreement dated as of
October 16, 1987, and amended as of
October 15, 1997, between Homestake
Mining Company and BankBoston N.A., as
successor to Bank of America National
Trust and Savings Association, as Rights
Agent.
EXECUTION COPY
RIGHTS AGREEMENT dated as of December 3,
1998 (the "Rights Agreement"), among
HOMESTAKE CANADA INC., an Ontario corporation
(the "Company"), HOMESTAKE MINING COMPANY, a
Delaware corporation ("HMC"), and MONTREAL
TRUST COMPANY OF CANADA, as Rights Agent (the
"Rights Agent").
WHEREAS, the Board of Directors of the Company has
authorized the issuance of one Right (as such number may
hereinafter be adjusted pursuant to the provisions of Section
12(a)) for each Exchangeable Share of the Company (the
"Exchangeable Shares") issued, or disposed of out of treasury
shares, between the Effective Date (including the Exchangeable
Shares issued on the Effective Date) and the Distribution Date
(as these terms are hereinafter defined) and, in certain
circumstances, after the Distribution Date, each Right
initially representing the right to purchase one Exchangeable
Share upon the terms and subject to the conditions hereinafter
set forth (the "Rights"); and
WHEREAS, as provided in the Arrangement Agreement
dated as of September 28, 1998 (the "Arrangement Agreement"),
among Prime Resources Group Inc., a British Columbia
corporation ("Prime"), Homestake Canada Holdings Company, a
Nova Scotia unlimited liability company ("Holdco"), HMC and
the Company, the Rights are intended to provide rights to
acquire additional Exchangeable Shares (or in certain
circumstances other securities) on terms substantially the
same as the HMC Rights (as hereinafter defined) confer the
right to acquire shares of HMC Common Stock (as hereinafter
defined) or preferred stock of HMC that is essentially the
economic equivalent of HMC Common Stock (or in certain
circumstances other securities);
NOW, THEREFORE, in consideration of the mutual
agreements contained herein and other good and valuable
consideration, the sufficiency and receipt of which are hereby
acknowledged, the Company, HMC and the Rights Agent agree as
follows:
SECTION 1. Certain Definitions. For purposes of this
Rights Agreement, the following terms have the meanings
indicated:
"Acquiring Person" shall have the meaning ascribed
to that term in the HMC Rights Agreement.
"Affiliate" and "Associate", when used with
reference to any Person, shall have the respective meanings
<PAGE>
ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act, as in effect on the date
of this Rights Agreement.
"Arrangement Agreement" shall have the meaning set
forth in the second introductory paragraph of this Rights
Agreement.
A Person shall be deemed the "Beneficial Owner" of,
and shall be deemed to "beneficially own", and shall be deemed
to have "Beneficial Ownership" of, any securities:
(i) which such Person or any of such Person's
Affiliates or Associates is deemed to "beneficially own"
within the meaning of Rule 13d-3 of the General Rules and
Regulations under the Exchange Act, as in effect on the
date of this Rights Agreement;
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire
(whether such right is exercisable immediately or only
after the passage of time) pursuant to any agreement,
arrangement or understanding (written or oral), rights
(other than the Rights or the HMC Rights), warrants or
options, or otherwise; provided, however, that a Person
shall not be deemed under this clause (A) the Beneficial
Owner of, or to beneficially own, or to have Beneficial
Ownership of, any securities tendered pursuant to a
tender or exchange offer made by or on behalf of such
Person or any of such Person's Affiliates or Associates
until such tendered securities are accepted for purchase
or exchange thereunder or cease to be subject to
withdrawal by the tendering security holder, or (B) the
right to vote pursuant to any agreement, arrangement or
understanding (written or oral); provided, however, that
a Person shall not be deemed under this clause (B) the
Beneficial Owner of, or to beneficially own, or to have
Beneficial Ownership of, any security if (1) the
agreement, arrangement or understanding (written or oral)
to vote such security arises solely from a revocable
proxy or consent given to such Person in response to a
public proxy or consent solicitation made generally to
all holders of Exchangeable Shares pursuant to, and in
accordance with, the applicable rules and regulations
under the Exchange Act and (2) the beneficial ownership
of such security is not also then reportable on Schedule
13D under the Exchange Act (or any comparable or
successor report); or
<PAGE>
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or
any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding (written or oral)
for the purpose of acquiring, holding, voting (except
pursuant to a revocable proxy as described in clause
(ii)(B) of this definition) or disposing of any
securities of the Company or of HMC.
Notwithstanding the foregoing, nothing contained in this
definition shall cause a Person ordinarily engaged in business
as an underwriter of securities to be the "Beneficial Owner"
of, or to "beneficially own" or to have "Beneficial Ownership"
of, any securities acquired in a bona fide firm commitment
underwriting pursuant to an underwriting agreement with the
Company or with HMC. Any Person who owns Exchangeable Shares
shall be deemed to beneficially own the maximum number of
Common Shares issuable to such holder upon the exchange or
retraction of all such Exchangeable Shares at the measurement
date.
"Book Value", when used with reference to Common
Shares issued by any Person, shall mean the amount of equity
of such Person applicable to each Common Share, determined (i)
in accordance with generally accepted accounting principles in
effect in the jurisdiction in which such Person is
incorporated and on the date as of which such Book Value is to
be determined, (ii) using all the consolidated assets and all
the consolidated liabilities of such Person on the date as of
which such Book Value is to be determined, except that no
value shall be included in such assets for goodwill arising
from consummation of a business combination, and (iii) after
giving effect to (A) the exercise of all rights, options and
warrants to purchase such Common Shares (other than the Rights
or the HMC Rights), and the conversion of all securities
convertible into such Common Shares, at an exercise or
conversion price, per Common Share, which is less than such
Book Value before giving effect to such exercise or conversion
(whether or not exercisability or convertibility is
conditioned upon occurrence of a future event), (B) all
dividends and other distributions on the capital stock of such
Person declared prior to the date as of which such Book Value
is to be determined and to be paid or made after such date,
and (C) any other agreement, arrangement or understanding
(written or oral), or transaction or other action contemplated
prior to the date as of which such Book Value is to be
determined that would have the effect of thereafter reducing
such Book Value.
<PAGE>
"Business Combination" shall have the meaning
ascribed to that term in the HMC Rights Agreement.
"Business Day" shall mean each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which
banking institutions in the Borough of Manhattan, The City of
New York, are authorized or obligated by law or executive
order to close.
"Close of Business" on any given date shall mean
5:00 p.m., New York City time, on such date; provided,
however, that, if such date is not a Business Day, "Close of
Business" shall mean 5:00 p.m., New York City time, on the
next succeeding Business Day.
"Common Shares", when used with reference to the
Company prior to a Business Combination, shall mean the
Exchangeable Shares of the Company or any other shares of
capital stock of the Company or of HMC into which the
Exchangeable Shares shall be reclassified or changed or
exchanged. "Common Shares", when used with reference to any
Person (other than the Company prior to a Business
Combination), shall mean shares of capital stock of such
Person (if such Person is a corporation) of any class or
series, or units of equity interests in such Person (if such
Person is not a corporation) of any class or series, the terms
of which do not limit (as a maximum amount and not merely in
proportional terms) the amount of dividends or income payable
or distributable on such class or series or the amount of
assets distributable on such class or series upon any
voluntary or involuntary liquidation, dissolution or winding
up of such Person and do not provide that such class or series
is subject to redemption at the option of such Person, or any
shares of capital stock or units of equity interests into
which the foregoing shall be reclassified or changed;
provided, however, that, if at any time there shall be more
than one such class or series of capital stock or equity
interests of such Person, "Common Shares" of such Person shall
include all such classes and series substantially in the
proportion of the total number of shares or other units of
each such class or series outstanding at such time unless any
such class or series is identical to another such class except
for voting power, in which case "Common Shares" shall include
such higher voting class in place of such lower voting class.
"Company" shall have the meaning set forth in the
heading of this Rights Agreement; provided, however, that if
there is a Business Combination, "Company" shall have the
meaning set forth in Section 11(c)(III).
<PAGE>
The term "control" with respect to any Person shall
mean the power to direct the management and policies of such
Person, directly or indirectly, by or through stock ownership,
agency or otherwise, or pursuant to or in connection with an
agreement, arrangement or understanding (written or oral) with
one or more other Persons by or through stock ownership,
agency or otherwise; and the terms "controlling" and
"controlled" shall have meanings correlative to the foregoing.
"Distribution Date" shall have the meaning ascribed
to that term in the HMC Rights Agreement.
"Effective Date" shall have the meaning ascribed to
that term in the Arrangement Agreement.
"Exchangeable Shares" shall have the meaning set
forth in the introductory paragraph of this Rights Agreement.
"Exchange Act" shall mean the Securities Exchange
Act of 1934 of the United States, as in effect on the date in
question, unless otherwise specifically provided.
"Exchange Consideration" shall have the meaning set
forth in Section 11(b)(I).
"Expiration Date" shall have the meaning set forth
in Section 7(a).
"HMC" shall have the meaning set forth in the
heading of this Rights Agreement.
"HMC Common Shares" shall mean the "Common Shares"
as defined in the HMC Rights Agreement.
"HMC Common Stock" shall mean the shares of Common
Stock of HMC, par value US$1.00 per share.
"HMC Rights" shall mean the "Rights" as defined in
the HMC Rights Agreement.
"HMC Rights Agreement" shall mean the Rights
Agreement dated as of October 16, 1987, between HMC and
BankBoston N.A., a national banking association, as Rights
Agent, as amended from time to time.
"Major Part", when used with reference to the assets
of the Company and its Subsidiaries as of any date, shall mean
assets (i) having a fair market value aggregating 50% or more
of the total fair market value of all the assets
<PAGE>
of the Company and its Subsidiaries (taken as a whole) as of
the date in question, (ii) accounting for 50% or more of the
total value (net of depreciation and amortization) of all the
assets of the Company and its Subsidiaries (taken as a whole)
as would be shown on a consolidated or combined balance sheet
of the Company and its Subsidiaries as of the date in
question, prepared in accordance with generally accepted
accounting principles then in effect, or (iii) accounting for
50% or more of the total amount of earnings before interest,
taxes, depreciation and amortization or of the revenues of the
Company and its Subsidiaries (taken as a whole) as would be
shown on, or derived from, a consolidated or combined
statement of income or operations of the Company and its
Subsidiaries for the period of 12 months ending on the last
day of the Company's monthly accounting period next preceding
the date in question, prepared in accordance with generally
accepted accounting principles then in effect under which the
Company prepares its financial statements.
"Market Value", when used with reference to Common
Shares of an issuer on any date, shall be deemed to be the
average of the daily closing prices, per share, of such Common
Shares for the period which is the shorter of (1) 30
consecutive Trading Days immediately prior to the date in
question or (2) the number of consecutive Trading Days
beginning on the Trading Day immediately after the date of the
first public announcement of the event requiring a
determination of the Market Value and ending on the Trading
Day immediately prior to the record date of such event;
provided, however, that, in the event that the Market Value of
such Common Shares is to be determined in whole or in part
during a period following the announcement by the issuer of
such Common Shares of any action of the type described in
Section 12(a) that would require an adjustment thereunder,
then, and in each such case, the Market Value of such Common
Shares shall be appropriately adjusted to reflect the effect
of such action on the market price of such Common Shares. The
closing price for each Trading Day shall be the closing price
quoted on the principal United States securities exchange
registered under the Exchange Act (or any recognized foreign
stock exchange) on which such securities are listed, or, if
such securities are not listed on any such exchange, the
closing price quoted on The Nasdaq Stock Market (or any
recognized foreign over-the-counter market) or, if such
securities are not so quoted, the average of the closing bid
and asked quotations with respect to a share of such
securities on any National Association of Securities Dealers,
Inc. quotations system or such other system then in use, or if
no such quotations are available, the average of the closing
bid and asked prices as furnished
<PAGE>
by a professional market maker making a market in such
securities selected by the Board of Directors of the Company.
If on any such Trading Day no market maker is making a market
in such securities, the closing price of such securities on
such Trading Day shall be deemed to be the fair value of such
securities as determined in good faith by the Board of
Directors of the Company acting by a vote of those directors
whose approval would be required to redeem the Rights under
Section 24 (whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on
the Rights Agent, the holders of Rights and all other
Persons).
"Person" shall mean an individual, corporation,
partnership, joint venture, association, trust, unincorporated
organization or other entity.
"Principal Party" shall mean the Surviving Person in
a Business Combination; provided, however, that, if such
Surviving Person is a direct or indirect Subsidiary of any
other Person, "Principal Party" shall mean the Person which is
the ultimate parent of such Surviving Person and which is not
itself a Subsidiary of another Person. In the event ultimate
control of such Surviving Person is shared by two or more
Persons, "Principal Party" shall mean that Person that is
immediately controlled by such two or more Persons.
"Purchase Price" with respect to each Right shall
mean US$75, as such amount may from time to time be adjusted
as provided herein, and shall be payable in lawful money of
the United States of America. All references herein to the
Purchase Price shall mean the Purchase Price as in effect at
the time in question.
"Redemption Date" shall have the meaning set forth
in Section 24(a).
"Redemption Price" with respect to each Right shall
mean US$.01, as such amount may from time to time be adjusted
in accordance with Section 12. All references herein to the
Redemption Price shall mean the Redemption Price as in effect
at the time in question.
"Registered Common Shares" shall mean Common Shares
which are, as of the date of consummation of a Business
Combination, and have continuously been for the 12 months
immediately preceding such date, registered under Section 12
of the Exchange Act.
<PAGE>
"Right Certificate" shall mean a certificate
evidencing a Right in substantially the form attached as
Exhibit A.
"Rights" shall mean the rights to purchase
Exchangeable Shares (or other securities) as provided in this
Rights Agreement.
"Securities Act" shall mean the Securities Act of
1933 of the United States, as in effect on the date in
question, unless otherwise specifically provided.
"Subsidiary" shall mean a Person, at least a
majority of the total outstanding voting power (being the
power under ordinary circumstances (and not merely upon the
happening of a contingency) to vote in the election of
directors of such Person (if such Person is a corporation) or
to participate in the management and control of such Person
(if such Person is not a corporation)) of which is owned,
directly or indirectly, by another Person or by one or more
other Subsidiaries of such other Person or by such other
Person and one or more other Subsidiaries of such other
Person.
"Surviving Person" shall have the meaning ascribed
to that term in the HMC Rights Agreement.
"Trading Day" shall mean a day on which the
principal United States securities exchange registered under
the Exchange Act (or principal recognized foreign stock
exchange, as the case may be) on which any securities or
Rights, as the case may be, are listed or admitted to trading
is open for the transaction of business or, if the securities
or Rights in question are not listed or admitted to trading on
any United States securities exchange (or recognized foreign
stock exchange, as the case may be), a Business Day.
SECTION 2. Appointment of Rights Agent. The Company
hereby appoints the Rights Agent to act as agent for the
Company in accordance with the terms and conditions hereof,
and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint one or more co-Rights
Agents as it may deem necessary or desirable upon notice to
the Rights Agent (the term "Rights Agent" being used herein to
refer, collectively, to the Rights Agent together with any
such co-Rights Agents). In the event the Company appoints one
or more co-Rights Agents, the respective duties of the Rights
Agent and any co-Rights Agents shall be as the Company shall
determine.
<PAGE>
SECTION 3. Issue of Rights and Right Certificates.
(a) One Right shall be associated with each Exchangeable Share
outstanding on the Effective Date, each additional
Exchangeable Share that shall become outstanding between the
Effective Date and the earliest of the Distribution Date, the
Redemption Date or the Expiration Date and each additional
Exchangeable Share with which Rights are issued after the
Distribution Date but prior to the earlier of the Redemption
Date or the Expiration Date as provided in Section 23;
provided, however, that, if the number of outstanding Rights
are combined into a smaller number of outstanding Rights
pursuant to Section 12(a), the appropriate fractional Right
determined pursuant to such Section shall thereafter be
associated with each such Exchangeable Share.
(b) Until the Distribution Date (x) the Rights will
be evidenced by the certificates for Exchangeable Shares
registered in the names of the holders thereof and not by
separate Right Certificates and (y) the Rights, including the
right to receive Right Certificates, will be transferable only
in connection with the transfer of Exchangeable Shares. As
soon as practicable after the Distribution Date, the Rights
Agent will send, by first-class, postage-prepaid mail, to each
record holder of Exchangeable Shares as of the Distribution
Date, at the address of such holder shown on the records of
the Company, a Right Certificate evidencing one whole Right
for each Exchangeable Share (or for the number of Exchangeable
Shares with which one whole Right is then associated if the
number of Rights per Exchangeable Share held by such record
holder has been adjusted in accordance with the proviso in
Section 3(a)). If the number of Rights associated with each
Exchangeable Share has been adjusted in accordance with the
proviso in Section 3(a), at the time of distribution of the
Right Certificates the Company may make any necessary and
appropriate rounding adjustments so that Right Certificates
representing only whole numbers of Rights are distributed and
cash is paid in lieu of any fractional Right in accordance
with Section 15(a). As of and after the Distribution Date, the
Rights will be evidenced solely by such Right Certificates.
(c) With respect to any certificate for Exchangeable
Shares, until the earliest of the Distribution Date, the
Redemption Date or the Expiration Date, the Rights associated
with the Exchangeable Shares represented by any such
certificate shall be evidenced by such certificate alone, the
registered holders of the Exchangeable Shares shall also be
the registered holders of the associated Rights and the
surrender for transfer of any such
<PAGE>
certificate shall also constitute the transfer of the Rights
associated with the Exchangeable Shares represented thereby.
(d) Certificates issued for Exchangeable Shares
(including, without limitation, upon transfer or exchange of
outstanding Exchangeable Shares) prior to the earliest of the
Distribution Date, the Redemption Date or the Expiration Date,
shall have printed on, written on or otherwise affixed to them
the following legend:
This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in a Rights
Agreement dated as of October 16, 1987 (as amended from
time to time, the "Rights Agreement"), among Homestake
Canada Inc., Homestake Mining Company and Montreal Trust
Company of Canada, as Rights Agent, the terms of which
are hereby incorporated herein by reference and a copy of
which is on file at the principal executive offices of
Homestake Canada Inc. Under certain circumstances, as set
forth in the Rights Agreement, such Rights will be
evidenced by separate certificates and will no longer be
evidenced by this certificate. Homestake Canada Inc. will
mail to the holder of this certificate a copy of the
Rights Agreement without charge after receipt of a
written request therefor. Under certain circumstances,
Rights issued to or held by Acquiring Persons or their
Affiliates or Associates (as such terms are defined in
the Rights Agreement) or by any subsequent holder of such
Rights may become null and void.
Notwithstanding this Section 3(d), the omission of a
legend shall not affect the enforceability of any part of this
Rights Agreement or the rights of any holder of Rights.
SECTION 4. Form of Right Certificates. The Right
Certificates (and the form of election to purchase and form of
assignment to be printed on the reverse side thereof) shall be
in substantially the form set forth as Exhibit A and may have
such marks of identification or designation and such legends,
summaries or endorsements printed thereon as the Company may
deem appropriate and as are not inconsistent with the
provisions of this Rights Agreement, or as may be required to
comply with any applicable law or with any rule or regulation
made pursuant thereto or with any rule or regulation of any
stock exchange on which the Rights may from time to time be
listed, or to conform to usage. Subject to the provisions of
Sections 7, 11 and 23, the Right Certificates, whenever
issued, shall be dated as of the Distribution Date, and on
their face shall entitle the holders thereof to purchase such
number of Exchangeable
<PAGE>
Shares as shall be set forth therein for the Purchase Price
set forth therein, subject to adjustment from time to time as
herein provided.
SECTION 5. Execution, Countersignature and
Registration. (a) The Right Certificates shall be executed on
behalf of the Company by the Chairman of the Board, the Chief
Executive Officer, the President, the Chief Operating Officer,
the Treasurer or any Vice President (whether preceded by any
additional title) of the Company, either manually or by
facsimile signature, and have affixed thereto the Company's
seal or a facsimile thereof which shall be attested by the
Secretary, an Assistant Secretary or a Vice President (whether
preceded by any additional title, provided that such Vice
President shall not have also executed the Right Certificates)
of the Company, either manually or by facsimile signature. The
Right Certificates shall be manually countersigned by the
Rights Agent and shall not be valid or obligatory for any
purpose unless so countersigned. In case any officer of the
Company who shall have signed any of the Right Certificates
shall cease to be such an officer of the Company before
countersignature by the Rights Agent and issuance and delivery
by the Company, such Right Certificates may nevertheless be
countersigned by the Rights Agent and issued and delivered by
the Company with the same force and effect as though the
person who signed such Right Certificates had not ceased to be
such an officer of the Company; and any Right Certificate may
be signed on behalf of the Company by any person who, at the
actual date of execution of such Right Certificate, shall be a
proper officer of the Company to sign such Right Certificate,
although at the date of execution of this Rights Agreement any
such person was not such an officer of the Company.
(b) Following the Distribution Date, the Rights
Agent will keep or cause to be kept, at its principal office,
books for registration and transfer of the Right Certificates
issued hereunder. Such books shall show the names and
addresses of the respective holders of the Right Certificates,
the number of Rights evidenced by each of the Right
Certificates, the certificate number of each of the Right
Certificates and the date of each of the Right Certificates.
SECTION 6. Transfer, Split-Up, Combination and
Exchange of Right Certificates; Mutilated, Destroyed, Lost or
Stolen Right Certificates; Uncertificated Rights. (a) Subject
to the provisions of Sections 7(e) and 15, at any time after
the Distribution Date, and at or prior to the Close of
Business on the earlier of the Redemption Date or
<PAGE>
the Expiration Date, any Right Certificate or Right
Certificates may be transferred, split-up, combined or
exchanged for another Right Certificate or Right Certificates
representing, in the aggregate, the same number of Rights as
the Right Certificate or Right Certificates surrendered then
represented. Any registered holder desiring to transfer,
split-up, combine or exchange any Right Certificate shall make
such request in writing delivered to the Rights Agent and
shall surrender the Right Certificate or Right Certificates to
be transferred, split-up, combined or exchanged at the
designated office of the Rights Agent; provided, however, that
neither the Rights Agent nor the Company shall be obligated to
take any action whatsoever with respect to the transfer of any
Right Certificate surrendered for transfer until the
registered holder shall have completed and signed the
certification contained in the form of assignment on the
reverse side of such Right Certificate and shall have provided
such additional evidence of the identity of the Beneficial
Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company or the Rights Agent shall reasonably
request. Thereupon the Rights Agent shall, subject to Sections
7(e) and 15, countersign and deliver to the Person entitled
thereto a Right Certificate or Right Certificates, as the case
may be, as so requested. The Company may require payment by
the holders of Rights of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any
transfer, split-up, combination or exchange of Right
Certificates.
(b) Upon receipt by the Company and the Rights Agent
of evidence reasonably satisfactory to them of the loss,
theft, destruction or mutilation of a valid Right Certificate,
and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to them, and, at the
Company's request, reimbursement to the Company and the Rights
Agent of all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancelation of the Right
Certificate if mutilated, the Company will make a new Right
Certificate of like tenor and deliver such new Right
Certificate to the Rights Agent for delivery to the registered
owner in lieu of the Right Certificate so lost, stolen,
destroyed or mutilated.
(c) Notwithstanding any other provision hereof, the
Company and the Rights Agent may amend this Rights Agreement
to provide for uncertificated Rights in addition to or in
place of Rights evidenced by Right Certificates.
SECTION 7. Exercise of Rights; Expiration Date of
Rights. (a) Subject to Section 7(e) and except as
<PAGE>
otherwise provided herein (including Section 11), each Right
shall entitle the registered holder thereof, upon exercise
thereof as provided herein, to purchase for the Purchase
Price, at any time after the Distribution Date and at or prior
to the earlier of (i) the Close of Business on October 15,
2007 (the Close of Business on such date being the "Expiration
Date"), (ii) the exchange of such Right pursuant to Section
11(b)(I) or (iii) the Redemption Date, one Exchangeable Share,
subject to adjustment from time to time as provided in
Sections 11 and 12.
(b) The registered holder of any Right Certificate
may exercise the Rights evidenced thereby (except as otherwise
provided herein) in whole or in part at any time after the
Distribution Date, upon surrender of the Right Certificate,
with the form of election to purchase on the reverse side
thereof duly executed, to the Rights Agent at the principal
office of the Rights Agent, together with payment of the
Purchase Price for each Exchangeable Share as to which the
Rights are exercised and an amount equal to any applicable
transfer tax payable by the holder of the Right Certificate in
accordance with the second sentence of Section 9(d), at or
prior to the earlier of (i) the Expiration Date, (ii) the
exchange of such Rights pursuant to Section 11(b)(I) or (iii)
the Redemption Date.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly
executed, accompanied by payment of the Purchase Price for the
Exchangeable Shares to be purchased together with an amount
equal to any applicable transfer tax payable by the holder of
the Right Certificate in accordance with the second sentence
of Section 9(d), in lawful money of the United States of
America, in cash or by certified check or money order payable
to the order of the Company, the Rights Agent shall thereupon
(i) promptly requisition from any transfer agent of the
Exchangeable Shares (or make available, if the Rights Agent is
the transfer agent) certificates for the number of
Exchangeable Shares to be purchased and the Company hereby
irrevocably authorizes its transfer agent to comply with all
such requests, (ii) when appropriate, promptly requisition
from the Company the amount of cash to be paid in lieu of
issuance of fractional shares in accordance with Section 15,
(iii) promptly after receipt of such certificates or
depositary receipts, cause the same to be delivered to or upon
the order of the registered holder of such Right Certificate,
registered in such name or names as may be designated by such
holder and (iv) when appropriate, after receipt promptly
deliver such cash to or upon the order of the registered
holder of such Right Certificate.
<PAGE>
(d) In case the registered holder of any Right
Certificate shall exercise fewer than all the Rights evidenced
thereby, a new Right Certificate evidencing Rights equivalent
to the Rights remaining unexercised shall be issued by the
Rights Agent and delivered to the registered holder of such
Right Certificate or to his duly authorized assigns, subject
to the provisions of Section 15.
(e) Notwithstanding anything in this Rights
Agreement to the contrary, any Rights that are at any time
beneficially owned by an Acquiring Person or an Affiliate or
Associate of an Acquiring Person shall become null and void
and nontransferable, and any holder of any such Right
(including any purported transferee or subsequent holder)
shall not have any right to exercise or transfer any such
Right.
(f) Notwithstanding anything in this Rights
Agreement to the contrary, neither the Rights Agent nor the
Company shall be obligated to undertake any action with
respect to a registered holder of any Right Certificates upon
the occurrence of any purported exercise as set forth in this
Section 7 unless such registered holder shall have (i)
completed and signed the certificate contained in the form of
election to purchase set forth on the reverse side of the
Right Certificate surrendered for such exercise and (ii)
provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably request.
(g) Upon the request of HMC, the Company may
temporarily suspend, for a period of time not to exceed 90
calendar days after the Distribution Date, the exercisability
of the Rights in order for the Company and HMC to prepare and
file a joint registration statement under the blue sky or
securities laws of the United States or Canada, any state or
provincial authority or such other jurisdiction as may be
necessary or appropriate, on an appropriate form, with respect
to the Exchangeable Shares purchasable upon exercise of the
Rights and permit such registration statement to become
effective; provided, however, that no such suspension shall
remain effective after, and the Rights shall without any
further action by the Company or any other Person become
exercisable immediately upon, the effectiveness of such
registration statement. Upon any such suspension, the Company
shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended
and shall issue a further public announcement at such time as
the suspension is no longer in effect. Notwithstanding any
provision
<PAGE>
herein to the contrary, the Rights shall not be exercisable in
any jurisdiction if the requisite qualification under the blue
sky or securities laws of the United States or Canada, any
state or provincial authority or any such other appropriate
jurisdiction shall not have been obtained or the exercise of
the Rights shall not be permitted under applicable law.
SECTION 8. Cancelation and Destruction of Right
Certificates. All Right Certificates surrendered or presented
for the purpose of exercise, transfer, split-up, combination
or exchange shall, and any Right Certificate representing
Rights that have become null and void and nontransferable
pursuant to Section 7(e) surrendered or presented for any
purpose shall, if surrendered or presented to the Company or
to any of its agents, be delivered to the Rights Agent for
cancelation or in canceled form, or, if surrendered or
presented to the Rights Agent, shall be canceled by it, and no
Right Certificates shall be issued in lieu thereof except as
expressly permitted by this Rights Agreement. The Company
shall deliver to the Rights Agent for cancelation and
retirement, and the Rights Agent shall so cancel and retire,
any Right Certificate purchased or acquired by the Company.
The Rights Agent shall deliver all canceled Right Certificates
to the Company, or shall, at the written request of the
Company, destroy such canceled Right Certificates, and in such
case shall deliver a certificate of destruction thereof to the
Company.
SECTION 9. Reservation and Availability of
Exchangeable Shares. (a) The Company covenants and agrees that
it will cause to be reserved and kept available out of its
authorized and unissued Exchangeable Shares or any authorized
and issued Exchangeable Shares held in its treasury, free from
preemptive rights or any right of first refusal, a number of
Exchangeable Shares sufficient to permit the exercise in full
of all outstanding Rights.
(b) The Company covenants and agrees that it will
take all such action as may be necessary to ensure that all
Exchangeable Shares delivered upon exercise or exchange of
Rights shall, at the time of delivery of the certificates for
such Exchangeable Shares (subject to payment of the Purchase
Price), be duly and validly authorized and issued and fully
paid and nonassessable shares.
(c) So long as the Exchangeable Shares issuable upon
the exercise or exchange of Rights are to be listed on any
securities exchange, the Company covenants and agrees to use
its best efforts to cause, from and after such time as the
Rights become exercisable or exchangeable, all
<PAGE>
Exchangeable Shares reserved for such issuance to be listed on
such securities exchange upon official notice of issuance upon
such exercise or exchange.
(d) The Company further covenants and agrees that it
will pay when due and payable any and all United States and
Canadian federal, state and provincial transfer taxes and
charges which may be payable in respect of the issuance or
delivery of Right Certificates or of any Exchangeable Shares
upon the exercise or exchange of the Rights. The Company shall
not, however, be required to pay any transfer tax which may be
payable in respect of any transfer or delivery of Right
Certificates to a Person other than, or in respect of the
issuance or delivery of certificates for the Exchangeable
Shares in a name other than that of, the registered holder of
the Right Certificate evidencing Rights surrendered for
exercise or exchange or to issue or deliver any certificates
for Exchangeable Shares upon the exercise or exchange of any
Rights until any such tax shall have been paid (any such tax
being payable by the holder of such Right Certificate at the
time of surrender) or until it has been established to the
Company's satisfaction that no such tax is due.
SECTION 10. Exchangeable Shares Record Date. Each
Person in whose name any certificate for Exchangeable Shares
is issued upon the exercise or exchange of Rights shall for
all purposes be deemed to have become the holder of record of
the Exchangeable Shares represented thereby on, and such
certificate shall be dated, the date upon which the Right
Certificate evidencing such Rights was duly surrendered and
payment of any Purchase Price (and any applicable transfer
taxes) was made; provided, however, that, if the date of such
surrender and payment is a date upon which the transfer books
of the Company for the Exchangeable Shares are closed, such
Person shall be deemed to have become the record holder of
such Exchangeable Shares on, and such certificate shall be
dated, the next succeeding Business Day on which the transfer
books of the Company for the Exchangeable Shares are open.
SECTION 11. Adjustments in Rights After There Is an
Acquiring Person; Exchange of Rights for Shares; Business
Combinations. (a) Upon any adjustment in the HMC Rights
pursuant to Section 11(a) of the HMC Rights Agreement, each
holder of a Right, except as provided in Section 7(e) is made,
shall thereafter have a right to receive, upon exercise
thereof for the Purchase Price in accordance with the terms of
this Rights Agreement, such number of Exchangeable Shares as
shall equal the result obtained by multiplying the Purchase
Price by a fraction, the numerator
<PAGE>
of which is the number of Exchangeable Shares for which a
Right is then exercisable and the denominator of which is 50%
of the Market Value of the HMC Common Shares on the date on
which such Person became an Acquiring Person. As soon as
practicable after any adjustment in the HMC Rights pursuant to
Section 11(a) of the HMC Rights Agreement (provided the
Company is not required to make the exchange contemplated by
Section 11(b)(I) for all outstanding Rights), the Company
covenants and agrees to use its best efforts to:
(I) work with HMC to prepare and file a joint
registration statement under the Securities Act, on an
appropriate form, with respect to the Exchangeable Shares
purchasable upon exercise of the Rights and the HMC
Common Stock into which such Exchangeable Shares may be
exchanged;
(II) cause such registration statement to become
effective as soon as practicable after such filing;
(III) cause such registration statement to remain
effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the Expiration
Date; and
(IV) qualify or register the Exchangeable Shares
purchasable upon exercise of the Rights under the blue
sky or securities laws of the United States or Canada,
any state or provincial authority or such other
jurisdictions as may be necessary or appropriate.
(b)(I) Simultaneously with the action by the Board
of Directors of HMC to exercise its option to exchange the HMC
Rights pursuant to Section 11(b)(I) of the HMC Rights
Agreement, the then outstanding and exercisable Rights (which
shall not include Rights that shall have become null and void
and nontransferable pursuant to the provisions of Section
7(e)) shall be automatically and mandatorily exchanged in the
same proportion and under the same terms and conditions as the
HMC Rights were exchanged pursuant to Section 11(b)(I) of the
HMC Rights Agreement (the consideration issuable per Right
pursuant to this Section 11(b)(I) being the "Exchange
Consideration"). If all the Rights are exchanged for Exchange
Consideration pursuant to this Section 11(b)(I) prior to the
physical distribution of the Rights Certificates, the Company
may distribute the Exchange Consideration in lieu of
distributing Right Certificates, in which case for purposes of
this Rights Agreement holders of Rights shall be deemed to
have simultaneously received and surrendered for exchange
Right Certificates on the date of such distribution.
<PAGE>
(II) The exchange of any Rights pursuant to
Section 11(b)(I) shall be irrevocable and, immediately upon
such exchange and without any notice, the right to exercise
any such Right pursuant to Section 11(a) shall terminate and
the only right thereafter of a holder of such Right shall be
to receive the Exchange Consideration in exchange for each
such Right held by such holder or, if the Exchange
Consideration shall not have been paid or issued, to exercise
any such Right pursuant to Section 11(c)(I). The Company shall
promptly give public notice of any such exchange; provided,
however, that the failure to give, or any defect in, such
notice shall not affect the validity of such exchange. The
Company promptly shall mail a notice of any such exchange to
all holders of such Rights at their last addresses as they
appear upon the registry books of the Rights Agent. Any notice
which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice. Each
such notice of exchange will state the method by which the
exchange of the Rights for the Exchange Consideration will be
effected and, in the event of any partial exchange, the number
of Rights which will be exchanged. Any partial exchange shall
be effected pro rata based on the number of Rights (other than
Rights which shall have become null and void and
nontransferable pursuant to the provisions of Section 7(e))
held by each holder of Rights.
(c)(I) In the event that, following a Distribution
Date, a Business Combination is consummated, each holder of a
Right, except as provided in Section 7(e), shall thereafter
have the right to receive, upon the exercise thereof for the
Purchase Price in accordance with the terms of this Rights
Agreement, the securities specified below (or, at such
holder's option, the securities specified in Section 11(a)):
(A) If the Principal Party in such Business
Combination has Registered Common Shares outstanding,
each Right shall thereafter represent the right to
receive, upon the exercise thereof for the Purchase Price
in accordance with the terms of this Rights Agreement,
such number of Registered Common Shares of such Principal
Party, free and clear of all liens, encumbrances or other
adverse claims, as shall have an aggregate Market Value
as of the time of exercise thereof equal to the result
obtained by multiplying the Purchase Price by two;
(B) If the Principal Party involved in such Business
Combination does not have Registered Common Shares
outstanding, each Right shall thereafter
<PAGE>
represent the right to receive, upon the exercise thereof
for the Purchase Price in accordance with the terms of
this Rights Agreement, at the election of the holder of
such Right at the time of the exercise thereof, any of:
(1) such number of Common Shares of the
Surviving Person in such Business Combination, free
and clear of all liens, encumbrances or other
adverse claims, as shall have an aggregate Book
Value immediately after giving effect to such
Business Combination equal to the result obtained by
multiplying the Purchase Price by two;
(2) such number of Common Shares of the
Principal Party in such Business Combination (if the
Principal Party is not also the Surviving Person in
such Business Combination), free and clear of all
liens, encumbrances or other adverse claims, as
shall have an aggregate Book Value immediately after
giving effect to such Business Combination equal to
the result obtained by multiplying the Purchase
Price by two; or
(3) if the Principal Party in such Business
Combination is an Affiliate of one or more Persons
that has Registered Common Shares outstanding, such
number of Registered Common Shares of whichever of
such Affiliates of the Principal Party has
Registered Common Shares with the greatest aggregate
Market Value on the date of consummation of such
Business Combination, free and clear of all liens,
encumbrances or other adverse claims, as shall have
an aggregate Market Value on the date of such
Business Combination equal to the result obtained by
multiplying the Purchase Price by two.
(II) HMC shall not consummate any Business
Combination unless each issuer of Common Shares for which
Rights may be exercised, as set forth in this Section 11(c),
shall have sufficient authorized Common Shares that have not
been issued or reserved for issuance (and which shall, when
issued upon exercise thereof in accordance with this Rights
Agreement, be validly issued, fully paid and nonassessable and
free of preemptive rights, rights of first refusal or any
other restrictions or limitations on the transfer or ownership
thereof) to permit the exercise in full of the Rights in
accordance with this Section 11(c) and unless prior thereto:
<PAGE>
(i) a registration statement under the Securities
Act on an appropriate form, with respect to the Rights
and the Common Shares of such issuer purchasable upon
exercise of the Rights, shall be effective under the
Securities Act;
(ii) a prospectus has been qualified or an exemption
from any prospectus qualification requirement shall be
available with respect to the Rights and the Common
Shares of such issuer purchasable upon exercise of the
Rights with all relevant Canadian securities law
authorities; and
(iii) HMC, the Company and each such issuer shall
have:
(A) executed and delivered to the Rights Agent
a supplemental agreement providing for the
assumption by such issuer of the obligations set
forth in this Section 11(c) (including the
obligation of such issuer to issue Common Shares
upon the exercise of Rights in accordance with the
terms set forth in Sections 11(c)(I) and 11(c)(III))
and further providing that such issuer, at its own
expense, will use its best efforts to:
(1) cause a registration statement under
the Securities Act on an appropriate form, with
respect to the Rights and the Common Shares of
such issuer purchasable upon exercise of the
Rights, to remain effective (with a prospectus
at all times meeting the requirements of the
Securities Act) until the Expiration Date;
(2) qualify or register the Rights and the
Common Shares of such issuer purchasable upon
exercise of the Rights under the blue sky or
securities laws of each relevant Canadian
province and such other jurisdictions as may be
necessary or appropriate; and
(3) list the Rights and the Common Shares
of such issuer purchasable upon exercise of the
Rights on each securities exchange on which the
Exchangeable Shares were listed prior to the
consummation of the Business Combination or, if
the Exchangeable Shares were not listed on a
securities
<PAGE>
exchange prior to the consummation of the
Business Combination, on a United States
securities exchange (or recognized foreign
stock exchange, as the case may be);
(B) furnished to the Rights Agent a
written opinion of independent counsel stating
that such supplemental agreement is a valid,
binding and enforceable agreement of such
issuer; and
(C) filed with the Rights Agent a
certificate of a nationally recognized firm of
independent accountants setting forth the
number of Common Shares of such issuer which
may be purchased upon the exercise of each
Right after the consummation of such Business
Combination.
(III) After consummation of any Business
Combination and subject to the provisions of Section
11(c)(II), (i) each issuer of Common Shares for which Rights
may be exercised as set forth in this Section 11(c) shall be
liable for, and shall assume, by virtue of such Business
Combination, all the obligations and duties of the Company
pursuant to this Rights Agreement, (ii) the term "Company"
shall thereafter be deemed to refer to such issuer, (iii) each
such issuer shall take such steps in connection with such
consummation as may be necessary to assure that the provisions
hereof (including the provisions of Sections 11(a) and 11(c))
shall thereafter be applicable, as nearly as reasonably may
be, in relation to its Common Shares thereafter deliverable
upon the exercise of the Rights, and (iv) the number of Common
Shares of each such issuer thereafter receivable upon exercise
of any Right shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions of Sections 11 and 12 and the provisions of
Sections 7, 9 and 10 with respect to the Exchangeable Shares
shall apply, as nearly as reasonably may be, on like terms to
any such Common Shares.
SECTION 12. Certain Adjustments. (a) To preserve the
actual or potential economic value of the Rights, if at any
time after the date of this Rights Agreement there shall be
any change in the Exchangeable Shares, whether by reason of
stock dividends, stock splits, reclassifications,
recapitalizations, mergers, consolidations, combinations or
exchanges of securities, split-ups, split-offs, spin-offs,
liquidations, other similar changes in capitalization, any
distribution or issuance of cash, assets, evidences of
indebtedness or subscription rights, options or warrants to
holders of
<PAGE>
Exchangeable Shares (other than distribution of the Rights or
regular quarterly cash dividends) or otherwise, then, in each
such event the Board of Directors of the Company shall make
such appropriate adjustments in the number of Exchangeable
Shares (or the number and kind of other securities) issuable
upon exercise of each Right, the Purchase Price and Redemption
Price in effect at such time and the number of Rights
outstanding at such time (including the number of Rights or
fractional Rights associated with each Exchangeable Share)
such that following such adjustment such event shall not have
had the effect of reducing or limiting the benefits the
holders of the Rights would have had absent such event.
(b) If, as a result of an adjustment made pursuant
to Section 12(a), the holder of any Right thereafter exercised
shall become entitled to receive any securities other than
Exchangeable Shares, thereafter the number of such securities
so receivable upon exercise of any Right shall be subject to
adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions of Sections
11 and 12 and the provisions of Sections 7, 9 and 10 with
respect to the Exchangeable Shares shall apply, as nearly as
reasonably may be, on like terms to any such other securities.
(c) All Rights originally issued by the Company
subsequent to any adjustment made to the amount of
Exchangeable Shares or other securities relating to a Right
shall evidence the right to purchase, for the Purchase Price,
the adjusted number and kind of securities purchasable from
time to time hereunder upon exercise of the Rights, all
subject to further adjustment as provided herein.
(d) Irrespective of any adjustment or change in the
Purchase Price or the number of Exchangeable Shares or number
or kind of other securities issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter
issued may continue to express the terms that were expressed
in the initial Right Certificates issued hereunder.
(e) In any case in which action taken pursuant to
Section 12(a) requires that an adjustment be made effective as
of a record date for a specified event, the Company may elect
to defer until the occurrence of such event the issuing to the
holder of any Right exercised after such record date the
Exchangeable Shares and/or other securities, if any, issuable
upon such exercise over and above the Exchangeable Shares
and/or other securities, if any,
<PAGE>
issuable before giving effect to such adjustment; provided,
however, that the Company shall deliver to such holder a due
bill or other appropriate instrument evidencing such holder's
right to receive such additional securities upon the
occurrence of the event requiring such adjustment.
SECTION 13. Certificate of Adjustment. Whenever an
adjustment is made as provided in Section 11 or 12, the
Company shall (a) promptly prepare a certificate setting forth
such adjustment and a brief statement of the facts accounting
for such adjustment, (b) promptly file with the Rights Agent
and with each transfer agent for the Exchangeable Shares a
copy of such certificate and (c) mail a brief summary thereof
to each holder of a Right Certificate (or, prior to the
Distribution Date, of the Exchangeable Shares) in accordance
with Section 25. The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment therein
contained.
SECTION 14. Additional Covenants. (a) Notwith
standing any other provision of this Rights Agreement, no
adjustment to the number of Exchangeable Shares (or fractions
of a share) or other securities for which a Right is
exercisable or the number of Rights outstanding or associated
with each Common Share or any similar or other adjustment
shall be made or be effective if such adjustment would have
the effect of reducing or limiting the benefits the holders of
the Rights would have had absent such adjustment, including,
without limitation, the benefits under Sections 11 and 12,
unless the terms of this Rights Agreement are amended so as to
preserve such benefits.
(b) Each of HMC and the Company covenants and agrees
that, after the Distribution Date, except as permitted by
Section 26, it will not take (or permit any Subsidiary of HMC
to take) any action if at the time such action is taken it is
intended or reasonably foreseeable that such action will
reduce or otherwise limit the benefits the holders of the
Rights would have had absent such action, including, without
limitation, the benefits under Sections 11 and 12. Any action
taken by the Company during any period after any Person
becomes an Acquiring Person but prior to the Distribution Date
shall be null and void unless such action could be taken under
this Section 14(b) from and after the Distribution Date. HMC
shall not consummate any Business Combination if any issuer of
Common Shares for which Rights may be exercised after such
Business Combination in accordance with Section 11(c) shall
have taken or contemplated taking any action that reduces or
otherwise limits the benefits the holders of the Rights
<PAGE>
would have had absent such action, including, without
limitation, the benefits under Sections 11 and 12.
SECTION 15. Fractional Rights and Fractional Shares.
(a) The Company may, but shall not be required to, issue
fractions of Rights or distribute Right Certificates which
evidence fractional Rights. In lieu of such fractional Rights,
the Company may pay to the registered holders of the Right
Certificates with regard to which such fractional Rights would
otherwise be issuable an amount in cash equal to the same
fraction of the current market value of a whole Right. For
purposes of this Section 15(a), the current market value of a
whole Right shall be the closing price of the Rights (as
determined pursuant to the second and third sentences of the
definition of Market Value contained in Section 1) for the
Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable.
(b) The Company may, but shall not be required to,
issue fractions of Exchangeable Shares upon exercise of the
Rights or distribute certificates which evidence fractional
Exchangeable Shares. In lieu of fractional Exchangeable
Shares, the Company may elect to (i) utilize a depository
arrangement as provided by the terms of the Exchangeable
Shares or (ii) in the case of a fraction of an Exchangeable
Share, pay to the registered holders of Right Certificates at
the time such Rights are exercised as herein provided an
amount in cash equal to the same fraction of the current
market value of one Exchangeable Share, if any are outstanding
and publicly traded (or the current market value of one Common
Share if the Exchangeable Shares are not outstanding and
publicly traded). For purposes of this Section 15(b), the
current market value of an Exchangeable Share shall be the
closing price of a HMC Common Share (as determined pursuant to
the second and third sentences of the definition of Market
Value contained in Section 1) for the Trading Day immediately
prior to the date of such exercise. If, as a result of an
adjustment made pursuant to Section 12(a), the holder of any
Right thereafter exercised shall become entitled to receive
any securities other than Exchangeable Shares, the provisions
of this Section 15(b) shall apply, as nearly as reasonably may
be, on like terms to such other securities.
(c) The Company may, but shall not be required to,
issue fractions of Exchangeable Shares upon exchange of Rights
pursuant to Section 11(b), or to distribute certificates that
evidence fractional Exchangeable Shares. In lieu of such
fractional Exchangeable Shares, the Company may pay to the
registered holders of the Right Certificates
<PAGE>
with regard to which such fractional Exchangeable Shares would
otherwise be issuable an amount in cash equal to the same
fraction of the current Market Value of one HMC Common Share
as of the date on which a Person became an Acquiring Person.
(d) Any holder of Rights by the acceptance of the
Rights expressly waives his right to receive any fractional
Rights or any fractional shares upon exercise of a Right
except as provided in this Section 15.
SECTION 16. Rights of Action. (a) All rights of
action in respect of this Rights Agreement are vested in the
respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the
Exchangeable Shares); and any registered holder of any Right
Certificate (or, prior to the Distribution Date, of the
Exchangeable Shares), without the consent of the Rights Agent
or of the holder of any other Right Certificate (or, prior to
the Distribution Date, of the Exchangeable Shares) may, in his
own behalf and for his own benefit, enforce, and may institute
and maintain any suit, action or proceeding against the
Company to enforce, or otherwise act in respect of, his right
to exercise the Rights evidenced by such Right Certificate in
the manner provided in such Right Certificate and in this
Rights Agreement. Without limiting the foregoing or any
remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not
have an adequate remedy at law for any breach of this Rights
Agreement and shall be entitled to specific performance of the
obligations of any Person under, and injunctive relief against
actual or threatened violations of the obligations of any
Person subject to, this Rights Agreement.
(b) Any holder of Rights who prevails in an action
to enforce the provisions of this Rights Agreement shall be
entitled to recover the reasonable costs and expenses,
including attorneys' fees, incurred in such action.
SECTION 17. Transfer and Ownership of Rights and
Right Certificates. (a) Prior to the Distribution Date, the
Rights will be transferable only in connection with the
transfer of the Exchangeable Shares and the Right associated
with each Exchangeable Share shall be automatically
transferred upon the transfer of each Exchangeable Share.
(b) After the Distribution Date, the Right
Certificates will be transferable, subject to Section 7(e),
only on the registry books of the Rights Agent if surren-
<PAGE>
dered at the principal office of the Rights Agent, duly
endorsed or accompanied by a proper instrument of transfer.
(c) The Company and the Rights Agent may deem and
treat the Person in whose name a Right Certificate (or, prior
to the Distribution Date, the associated Exchangeable Shares
certificate) is registered as the absolute owner thereof and
of the Rights evidenced thereby (notwithstanding any notations
of ownership or writing on the Right Certificates or the
associated certificate for Exchangeable Shares made by anyone
other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall
be affected by any notice to the contrary.
SECTION 18. Right Certificate Holder Not Deemed a
Stockholder. No holder, as such, of any Right Certificate
shall be entitled to vote or receive dividends or be deemed,
for any purpose, the holder of the Exchangeable Shares or of
any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby,
nor shall anything contained herein or in any Right Certifi
cate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of
the Company or HMC, including, without limitation, any right
to vote for the election of directors or upon any matter
submitted to stockholders at any meeting thereof, or to give
or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting stockholders, or
to receive dividends or other distributions or subscription
rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance
with the provisions hereof.
SECTION 19. Concerning the Rights Agent. (a) The
Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and
from time to time, on demand of the Rights Agent, its
reasonable counsel fees and expenses and other disbursements
incurred in the administration and execution of this Rights
Agreement and the exercise and performance of its duties
hereunder, including any taxes or governmental charges imposed
as a result of the action taken by it hereunder (other than
any taxes on the fees payable to it).
(b) The Rights Agent shall be protected and shall
incur no liability for or in respect of any action taken,
suffered or omitted by it in connection with its administra
tion of this Rights Agreement in reliance upon any Right
Certificate or certificate for the Exchangeable Shares or for
other securities of the Company, instrument of
<PAGE>
assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, opinion, instruction, direction,
consent, certificate, statement, or other paper or document
believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper
Person or Persons.
SECTION 20. Merger or Consolidation or Change of
Rights Agent. (a) Any corporation into which the Rights Agent
or any successor Rights Agent may be merged or amalgamated or
with which it may be consolidated, or any corporation
resulting from any merger, amalgamation or consolidation to
which the Rights Agent or any successor Rights Agent shall be
a party, or any corporation succeeding to the stock transfer
or corporate trust business of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights
Agent under this Rights Agreement without the execution or
filing of any paper or any further act on the part of any of
the parties hereto; provided, however, that such corporation
would be eligible for appointment as a successor Rights Agent
under the provisions of Section 22. In case, at the time such
successor Rights Agent shall succeed to the agency created by
this Rights Agreement, any of the Right Certificates shall
have been countersigned but not delivered, any such successor
Rights Agent may adopt the countersignature of the predecessor
Rights Agent and deliver such Right Certificates so
countersigned; and, in case at that time any of the Right
Certificates shall not have been countersigned, any succes sor
Rights Agent may countersign such Right Certificates either in
the name of the predecessor Rights Agent or in the name of the
successor Rights Agent; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this Rights Agreement.
(b) In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right
Certificates shall have been countersigned but not deliv ered,
the Rights Agent may adopt the countersignature under its
prior name and deliver Right Certificates so counter signed;
and, in case at that time any of the Right Certifi cates shall
not have been countersigned, the Rights Agent may countersign
such Right Certificates either in its prior name or in its
changed name; and in all such cases such Right Certificates
shall have the full force provided in the Right Certificates
and in this Rights Agreement.
SECTION 21. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Rights
Agreement upon the following terms and conditions, by all of
which the Company and the holders of Right Certifi-
<PAGE>
cates (or, prior to the Distribution Date, of the Exchangeable
Shares), by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
satisfactory to it (who may be legal counsel for the Company),
and the opinion of such counsel shall be full and complete
authorization and protection to the Rights Agent as to any
action taken, suffered or omitted by it in good faith and in
accordance with such opinion.
(b) Whenever in the performance of its duties under
this Rights Agreement the Rights Agent shall deem it necessary
or desirable that any fact or matter (including, without
limitation, the identity of any Acquiring Person) be proved or
established by the Company prior to taking, refraining from
taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by any one of
the Chairman of the Board, the Chief Executive Officer, the
President, the Chief Operating Officer, the Chief Financial
Officer, a Vice President (whether preceded by any additional
title), the Treasurer or the Secretary of the Company and
delivered to the Rights Agent or by the directors of the
Company whose vote would be sufficient to redeem the Rights
under Section 24. Such certificate shall be full authorization
to the Rights Agent for any action taken or suffered in good
faith by it under the provisions of this Rights Agreement in
reliance upon such certificate. In the event any such
certificate signed by such directors is inconsistent with any
other such certificate, the certificate signed by such
directors shall control.
(c) The Rights Agent shall be liable hereunder only
for its own negligence, bad faith or wilful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained
in this Rights Agreement or in the Right Certifi cates (except
as to its countersignature thereof) or be required to verify
the same, but all such statements and recitals are and shall
be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Rights
Agreement or the execution and delivery hereof (except the due
execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except
<PAGE>
its countersignature thereof); nor shall it be responsible for
any breach by the Company of any covenant or condition
contained in this Rights Agreement or in any Right Certifi
cate; nor shall it be responsible for any adjustment required
under the provisions of Section 11 or 12 or responsible for
the manner, method or amount of any such adjustment or the
ascertaining of the existence of facts that would require any
such adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after actual notice of any
such adjustment); nor shall it by any act hereunder be deemed
to make any representation or warranty as to the authorization
or reservation of any Exchangeable Shares to be issued
pursuant to this Rights Agreement or any Right Certificate or
as to whether any Exchangeable Shares will, when so issued, be
validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform,
execute, acknowledge and deliver or cause to be performed,
executed, acknowledged and delivered all such further and
other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or per
forming by the Rights Agent of the provisions of this Rights
Agreement.
(g) The Rights Agent is hereby authorized and
directed to accept instructions with respect to the perfor
mance of its duties hereunder from any one of the Chairman of
the Board, the Chief Executive Officer, the President, a Vice
President (whether preceded by any additional title), the
Secretary or the Treasurer of the Company or from the
directors of the Company whose vote would be sufficient to
redeem the Rights under Section 24, and to apply to such
officers or directors for advice and instructions in
connection with its duties and it shall not be liable for any
action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officers or directors
or for any delay in acting while waiting for those
instructions. Any application by the Rights Agent for written
instructions from the Company may, at the option of the Rights
Agent, set forth in writing any action proposed to be taken or
omitted by the Rights Agent under this Agreement and the date
on and/or after which such action shall be taken or such
omission shall be effective. The Rights Agent shall not be
liable for any action taken by, or omission of, the Rights
Agent in accordance with a proposal included in such
application on or after the date specified in such application
(which date shall not be less than three Business Days after
the date any officer of the Company actually receives such
application, unless any such officer shall have consented in
writing to any earlier date) unless,
<PAGE>
prior to taking any such action (or the effective date in the
case of an omission), the Rights Agent shall have received
written instructions in response to such application
specifying the action to be taken or omitted.
(h) The Rights Agent and any stockholder, direc tor,
officer, employee or affiliate of the Rights Agent may buy,
sell or deal in any of the Rights or other securities of the
Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as
though it were not the Rights Agent under this Rights
Agreement. Nothing herein shall preclude the Rights Agent from
acting in any other capacity for the Company or for any other
legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or
agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct
provided reasonable care was exercised in the selection and
continued employment thereof.
(j) The Company agrees to indemnify and to hold the
Rights Agent harmless against any loss, liability, damage or
expense (including reasonable fees and expenses of legal
counsel) which the Rights Agent may incur in connection with
this Rights Agreement; provided, however, that the Rights
Agent shall not be indemnified or held harmless with respect
to any such loss, liability, damage or expense incurred by the
Rights Agent as a result of, or arising out of, its own
negligence, bad faith or wilful misconduct. If any action,
proceeding (including, but not limited to, any governmental
investigation), claim or dispute (collectively, a
"Proceeding") in respect of which indemnity may be sought is
brought or asserted against the Rights Agent, the Rights Agent
shall promptly (and in no event more than ten (10) days after
receipt of written notice of such Proceeding) notify the
Company of such Proceeding. The failure of the Rights Agent to
so notify the Company shall not impair the Rights Agent's
ability to seek indemnification from the Company (but only for
costs, expenses and liabilities incurred after such notice)
unless such failure adversely affects the Company's ability to
adequately oppose or defend such Proceeding. Upon receipt of
such notice from the Rights Agent, the Company shall be
entitled to participate in such Proceeding and, to the extent
that it shall so desire and provided no conflict of
<PAGE>
interest exists as specified in (b) below or there are no
other defenses available to the Rights Agent as specified in
(d) below, to assume the defense thereof with counsel
reasonably satisfactory to the Rights Agent (in which case all
attorney's fees and expenses shall be borne by the Company and
the Company shall in good faith defend the Rights Agent). The
Rights Agent shall have the right to employ separate counsel
in any such Proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be
borne by the Rights Agent unless (a) the Company agrees in
writing to pay such fees and expenses, (b) the Rights Agent
shall have reasonably and in good faith concluded that there
is a conflict of interest between the Company and the Rights
Agent in the conduct of the defense of such action, (c) the
Company fails, within ten (10) days prior to the date the
first response or appearance is required to be made in such
Proceeding, to assume the defense of such Proceeding with
counsel reasonably satisfactory to the Rights Agent or (d)
there are legal defenses available to the Rights Agent that
are different from or are in addition to those available to
the Company. No compromise or settlement of such Proceeding
may be effected by either party without the other party's
consent unless (i) there is no finding or admission of any
violation of law and no effect on any other claims that may be
made against such other party and (ii) the sole relief
provided is monetary damages that are paid in full by the
party seeking the settlement. Neither party shall have any
liability with respect to any compromise or settlement
effected without its consent, which consent shall not be
unreasonably withheld. The Company shall have no obligation to
indemnify and hold harmless the Rights Agent from any loss,
expense or liability incurred by the Rights Agent as a result
of a default judgment entered against the Rights Agent unless
such judgment was entered after the Company agreed, in
writing, to assume the defense of such Proceeding. The
provisions of this Section 21(j) shall survive expiration of
the Rights and the termination of this Agreement.
(k) The Rights Agent shall be under no obligation to
institute any action, suit or legal proceeding or to take any
other action likely to involve expense unless the Company or
one or more registered holders of Right Certificates shall
furnish the Rights Agent with security and indemnity to its
satisfaction for any costs and expenses which may be incurred.
(l) The Rights Agent shall not be liable for failure
to perform any duties except as specifically set forth herein
and no implied covenants or obligations shall
<PAGE>
be read into this Agreement against the Rights Agent, whose
duties and obligations are ministerial and shall be determined
solely by the express provisions hereof.
SECTION 22. Change of Rights Agent. The Rights Agent
or any successor Rights Agent may resign and be discharged
from its duties under this Rights Agreement upon 30 days'
notice in writing mailed to the Company and to each transfer
agent of the Exchangeable Shares by registered or certified
mail. The Company may remove the Rights Agent or any successor
Rights Agent upon 30 days' notice in writing, mailed to the
Rights Agent or successor Rights Agent, as the case may be,
and to each transfer agent of the Exchangeable Shares by
registered or certified mail. If the Rights Agent shall resign
or be removed or shall otherwise become incapable of acting,
the Company shall appoint a successor to the Rights Agent. If
the Company shall fail to make such appointment within a
period of 30 days after giving notice of such removal or after
it has been notified in writing of such resignation or
incapacity by the resigning or incapaci tated Rights Agent or
by the holder of a Right Certificate (or, prior to the
Distribution Date, of the Exchangeable Shares) (who shall,
with such notice, submit his Right Certificate or, prior to
the Distribution Date, the certificate representing his
Exchangeable Shares, for inspection by the Company), then the
Rights Agent or the registered holder of any Right Certificate
(or, prior to the Distribution Date, of the Exchangeable
Shares) may apply to any court of competent jurisdiction for
the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court,
shall be a corporation incorporated under the laws of Canada
or a province thereof authorized to carry on the business of a
trust company in the Province of Ontario. After appointment,
the successor Rights Agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been
originally named as Rights Agent without further act or deed;
but the predecessor Rights Agent shall deliver and transfer to
the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment, the Company
shall file notice thereof in writing with the predecessor
Rights Agent and each transfer agent of the Exchangeable
Shares, and mail a notice thereof in writing to the registered
holders of the Right Certificates (or, prior to the
Distribution Date, of the Exchangeable Shares). Failure to
give any notice provided for in this Section 22, however, or
any defect therein shall not affect the legality or validity
of the resignation or
<PAGE>
removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.
SECTION 23. Issuance of Additional Rights and Right
Certificates. Notwithstanding any of the provisions of this
Rights Agreement or of the Rights to the contrary, the Company
may, at its option, issue new Right Certificates evidencing
Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change made in
accordance with the provisions of this Rights Agreement. In
addition, in connection with the issuance or sale of
Exchangeable Shares following the Distribution Date and prior
to the earlier of the Redemption Date, the exchange of Rights
pursuant to Section 11(b)(I) and the Expiration Date, the
Company (a) shall, with respect to Exchangeable Shares so
issued or sold pursuant to the exercise of stock options or
under any employee plan or arrangement, or upon the exer cise,
conversion or exchange of securities, notes or deben tures
issued by the Company, and (b) may, in any other case, if
deemed necessary or appropriate by the Board of Directors of
the Company, issue Right Certificates representing the
appropriate number of Rights in connection with such issu ance
or sale; provided, however, that (i) no such Right Certificate
shall be issued if, and to the extent that, the Company shall
be advised by counsel that such issuance would create a
significant risk of material adverse tax conse quences to the
Company or the Person to whom such Right Certificate would be
issued, (ii) no such Right Certificate shall be issued if, and
to the extent that, appropriate adjustment shall otherwise
have been made in lieu of the issuance thereof and (iii) no
such Right Certificate shall be issued to an Acquiring Person
or an Affiliate or Associate of an Acquiring Person.
SECTION 24. Redemption and Termination. (a) The
Board of Directors of the Company shall, simultaneously with
any order by the Board of Directors of HMC pursuant to Section
24 of the HMC Rights Agreement, order the redemption of all,
but not fewer than all, the then outstanding Rights at the
Redemption Price (the date of such redemption being the
"Redemption Date"), and the Company, at its option, may pay
the Redemption Price either in cash or Exchangeable Shares or
other securities of the Company deemed by the Board of
Directors of the Company, in the exercise of its sole
discretion, to be at least equivalent in value to the
Redemption Price.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the redemption of the
Rights, and without any further action and without any notice,
the right to exercise the Rights will terminate and
<PAGE>
the only right thereafter of the holders of Rights shall be to
receive the Redemption Price. Within 10 Business Days after
the action of the Board of Directors of the Company ordering
the redemption of the Rights, the Company shall give notice of
such redemption to the holders of the then outstanding Rights
by mailing such notice to all such holders at their last
addresses as they appear upon the registry books of the Rights
Agent or, prior to the Distri bution Date, on the registry
books of the transfer agent for the Exchangeable Shares. Each
such notice of redemption will state the method by which
payment of the Redemption Price will be made. The notice, if
mailed in the manner herein provided, shall be conclusively
presumed to have been duly given, whether or not the holder of
Rights receives such notice. In any case, failure to give such
notice by mail, or any defect in the notice, to any particular
holder of Rights shall not affect the sufficiency of the
notice to other holders of Rights.
SECTION 25. Notices. Notices or demands authorized
by this Agreement to be given or made by the Rights Agent or
by the holder of a Right Certificate (or, prior to the
Distribution Date, of the Exchangeable Shares) to or on the
Company shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Rights Agent) as follows:
Homestake Mining Company
650 California Street
San Francisco, CA 94108-2788
Attn: General Counsel
with a copy to:
Homestake Canada Inc.
1100-1055 West Georgia Street
Vancouver, British Columbia,
CANADA V6E 3P3
Attn: Vice President, Finance
Subject to the provisions of Section 22, any notice or demand
authorized by this Rights Agreement to be given or made by the
Company or by the holder of a Right Certificate (or, prior to
the Distribution Date, of the Exchangeable Shares) to or on
the Rights Agent shall be sufficiently given or made if sent
by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
<PAGE>
Montreal Trust Company
510 Burrard Street
Vancouver, British Columbia,
Canada V6C 3B9
Attn: Client Servicing Officer
Notices or demands authorized by this Rights Agreement to be
given or made by the Company or the Rights Agent to any holder
of a Right Certificate (or, prior to the Distribution Date, of
the Exchangeable Shares) shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed to
such holder at the address of such holder as shown on the
registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent
for the Exchangeable Shares.
SECTION 26. Supplements and Amendments. At any time
prior to the Distribution Date and subject to clause (a) of
the last sentence of this Section 26, the Company may, and the
Rights Agent shall if the Company so directs, supplement or
amend any provision of this Rights Agreement (including,
without limitation, the date on which the Distribution Date
shall occur, the definition of "Acquiring Person" and the time
during which the Rights may be redeemed pursuant to Section
24) without the approval of any holder of the Rights. From and
after the Distribution Date and subject to applicable law, the
Company may, and the Rights Agent shall if the Company so
directs, amend this Rights Agreement without the approval of
any holders of Right Certificates (i) to cure any ambiguity or
to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provision of
this Rights Agreement or (ii) to make any other provisions in
regard to matters or questions arising hereunder which the
Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Right
Certificates (other than an Acquiring Person or an Affiliate
or Associate of an Acquiring Person). Any supplement or
amendment adopted during any period after any Person has
become an Acquiring Person but prior to the Distribution Date
shall be null and void unless such supplement or amendment
could have been adopted under the prior sentence from and
after the Distribution Date. Any supplement or amendment to
this Rights Agreement duly approved by the Company that does
not amend Sections 19, 20, 21 or 22 in a manner adverse to the
Rights Agent shall become effective immediately upon execution
by the Company, whether or not also executed by the Rights
Agent. The Rights Agent shall receive prompt written notice
from the Company of any amendment hereunder. Upon the delivery
of a certificate from an appropriate officer of the Company
which states that
<PAGE>
the proposed supplement or amendment is in compliance with the
terms of this Section, the Rights Agent shall execute such
supplement or amendment. Notwithstanding any other provision
hereof, (a) the Rights Agent's consent must be obtained
regarding any amendment or supplement pursuant to this Section
26 which alters the Rights Agent's rights or duties, (b) if
any provision of the HMC Rights Agreement is supplemented or
amended, the Company shall supplement or amend this Rights
Agreement as soon as practicable in substantially the same
manner (unless such supplement or amendment shall be in
violation of the laws of the Province of Ontario or the
federal laws of Canada applicable therein) and (c) except
pursuant to clause (b) above, no provision of this Rights
Agreement shall be supplemented or amended (except to cure any
ambiguity or to correct or supplement any provision contained
herein which may be inconsistent with any provision of the HMC
Rights Agreement or the laws of the Province of Ontario and
the federal laws of Canada applicable therein).
SECTION 27. Successors. All the covenants and
provisions of this Rights Agreement by or for the benefit of
the Company, HMC or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns
hereunder.
SECTION 28. Benefits of Rights Agreement;
Determinations and Actions by the Board of Directors, etc. (a)
Nothing in this Rights Agreement shall be construed to give to
any Person other than the Company, HMC, the Rights Agent and
the registered holders of the Right Certificates (and, prior
to the Distribution Date, of the Exchangeable Shares) any
legal or equitable right, remedy or claim under this Rights
Agreement; but this Rights Agreement shall be for the sole and
exclusive benefit of the Company, HMC, the Rights Agent and
the registered holders of the Right Certificates (and, prior
to the Distribution Date, of the Exchangeable Shares).
(b) Except as explicitly otherwise provided in this
Rights Agreement, the Board of Directors of the Company shall
have the exclusive power and authority to administer this
Rights Agreement and to exercise all rights and powers
specifically granted to the Board of Directors of the Company
or to the Company, or as may be necessary or advisable in the
administration of this Rights Agreement, including, without
limitation, the right and power to (i) interpret the
provisions of this Rights Agreement and (ii) make all
determinations deemed necessary or advisable for the
administration of this Rights Agreement (including, without
limitation, a determination to redeem or not redeem
<PAGE>
the Rights or to amend or not amend this Rights Agreement and
whether or not there is an Acquiring Person).
SECTION 29. Severability. If any term, provi sion,
covenant or restriction of this Rights Agreement is held by a
court of competent jurisdiction or other authority to be
invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Rights
Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.
SECTION 30. GOVERNING LAW. THIS RIGHTS AGREEMENT AND
EACH RIGHT CERTIFICATE ISSUED HEREUNDER SHALL BE DEEMED TO BE
A CONTRACT MADE UNDER THE LAW OF THE PROVINCE OF ONTARIO AND
FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF SUCH STATE APPLICABLE TO CONTRACTS
TO BE MADE AND PERFORMED ENTIRELY WITHIN SUCH STATE, PROVIDED,
HOWEVER, THAT THE RIGHTS AND OBLIGATIONS OF THE RIGHTS AGENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK.
SECTION 31. Counterparts; Effectiveness. This Rights
Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together
constitute but one and the same instrument. This Rights
Agreement shall be effective as of the Close of Business on
the date hereof.
SECTION 32. Descriptive Headings. Descriptive
headings of the several Sections of this Rights Agreement are
inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions of this
Rights Agreement.
IN WITNESS WHEREOF, the parties hereto have caused
this Rights Agreement to be duly executed as of the day and
year first above written.
HOMESTAKE CANADA INC.,
by
/s/ Gene G. Elam
--------------------------
Name: Gene G. Elam
Title: Vice President
<PAGE>
HOMESTAKE MINING COMPANY,
by
/s/ Wayne Kirk
-------------------------
Name: Wayne Kirk
Title: Vice President
MONTREAL TRUST COMPANY,
as Rights Agent,
by
/s/ L. Buckley
--------------------------
Name:
Title:
EXECUTION COPY
AMENDMENT NO. 2, dated as of
December 3, 1998, to the Rights
Agreement dated as of October 16, 1987,
and amended as of October 15, 1997 (as
amended, the "Rights Agreement"),
between HOMESTAKE MINING COMPANY, a
Delaware corporation (the "Company"),
and BANKBOSTON N.A., a national banking
association, as successor to BANK OF
AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, a national banking
corporation, as Rights Agent (the
"Rights Agent").
WHEREAS the Board of Directors of Homestake Canada
Inc., an Ontario corporation ("HCI"), has authorized the
issuance of one right (as such number may be adjusted from
time to time) for each Exchangeable Share of HCI (the "HCI
Exchangeable Shares"), each right initially representing the
right to purchase one HCI Exchangeable Share (the "HCI
Rights");
WHEREAS, as provided in the Arrangement Agreement
dated as of September 28, 1998, among Prime Resources Group
Inc., Homestake Canada Holdings Company, the Company and HCI
(the "Arrangement Agreement"), the HCI Rights are intended to
provide rights to acquire additional HCI Exchangeable Shares
(or in certain circumstances other securities) on terms
substantially the same as the rights issued under the Rights
Agreement confer the right to acquire shares of common stock
of the Company or preferred stock of the Company that is
essentially the economic equivalent of common stock of the
Company (or in certain circumstances other securities); and
WHEREAS pursuant to Section 26 of the Rights
Agreement the Board of Directors of the Company has determined
that an amendment to the Rights Agreement as set forth herein
is necessary and desirable to reflect the foregoing and the
Company and the Rights Agent desire to evidence such amendment
in writing.
NOW, THEREFORE, in consideration of the mutual
agreements contained herein and other good and valuable
<PAGE>
consideration, the sufficiency and receipt of which are hereby
acknowledged, the Company and the Rights Agent agree as
follows:
ARTICLE I
Amendments to the Rights Agreement
SECTION 1.01. The definitions of "Acquiring Person",
"Beneficial Owner" and "Book Value" in Section 1 of the Rights
Agreement are hereby amended, effective as of the date of this
Amendment, by deleting the text of such definitions in their
entireties and by replacing each of them with the following:
"Acquiring Person" shall mean any Person who or
which, alone or together with all Affiliates and Associates of
such Person, shall be the Beneficial Owner of Common Shares
representing more than 15% of the aggregate number of Common
Shares and HCI Exchangeable Shares then outstanding but shall
not include (a) the Company, any Subsidiary of the Company,
any employee benefit or compensation plan of the Company or of
any of its Subsidiaries, or any Person holding Common Shares
or HCI Exchangeable Shares for or pursuant to the terms of any
such employee benefit or compensation plan, (b) the holder of
the Homestake Special Voting Stock or (c) any such Person who
has become and is such a Beneficial Owner solely because (i)
of a change in the aggregate number of Common Shares or HCI
Exchangeable Shares outstanding since the last date on which
such Person acquired Beneficial Ownership of any Common Shares
or HCI Exchangeable Shares or (ii) it acquired such Beneficial
Ownership in the good faith belief that such acquisition would
not (x) cause such Beneficial Ownership to exceed 15% of the
aggregate number of Common Shares and HCI Exchangeable Shares
then outstanding and such Person relied in good faith in
computing the percentage of its Beneficial Ownership on
publicly filed reports or documents of the Company or HCI that
are inaccurate or out-of-date or (y) otherwise cause a
Distribution Date or the adjustment provided for in Section
11(a) to occur. Notwithstanding clause (c)(ii) of the prior
sentence, if any Person that is not an Acquiring Person due to
such clause (c)(ii) does not reduce its percentage of
Beneficial Ownership of Common Shares and HCI Exchangeable
Shares to 15% or less by the Close of Business on the fifth
Business Day after notice from the Company (the date of notice
being the first day) that such Person's Beneficial Ownership
of Common Shares or HCI Exchangeable Shares or any combination
thereof so exceeds 15%, such Person shall, at the end of such
five Business Day period, become an Acquiring Person (and such
clause (c)(ii) shall no
<PAGE>
longer apply to such Person). For purposes of this definition,
the determination whether any Person acted in "good faith"
shall be conclusively determined by the Board of Directors of
the Company, acting by a vote of those directors of the
Company whose approval would be required to redeem the Rights
under Section 24.
A Person shall be deemed the "Beneficial Owner" of,
and shall be deemed to "beneficially own", and shall be deemed
to have "Beneficial Ownership" of, any securities:
(i) which such Person or any of such Person's
Affiliates or Associates is deemed to "beneficially own"
within the meaning of Rule 13d-3 of the General Rules and
Regulations under the Exchange Act, as in effect on the
date of this Rights Agreement;
(ii) which such Person or any of such Person's
Affiliates or Associates has: (A) the right to acquire
(whether such right is exercisable immediately or only
after the passage of time) pursuant to any agreement,
arrangement or understanding (written or oral), or upon
the exchange or retraction of HCI Exchangeable Shares, or
upon the exercise of conversion rights, exchange rights,
rights (other than the Rights or the HCI Rights),
warrants or options, or otherwise; provided, however,
that a Person shall not be deemed under this clause (A)
the Beneficial Owner of, or to beneficially own, or to
have Beneficial Ownership of, any securities tendered
pursuant to a tender or exchange offer made by or on
behalf of such Person or any of such Person's Affiliates
or Associates until such tendered securities are accepted
for purchase or exchange thereunder or cease to be
subject to withdrawal by the tendering security holder;
or (B) the right to vote pursuant to any agreement,
arrangement or understanding (written or oral); provided,
however, that a Person shall not be deemed under this
clause (B) the Beneficial Owner of, or to beneficially
own, or to have Beneficial Ownership of, any security if
(1) the agreement, arrangement or understanding (written
or oral) to vote such security arises solely from a
revocable proxy or consent given to such Person in
response to a public proxy or consent solicitation made
generally to all holders of Common Stock or HCI
Exchangeable Shares pursuant to, and in accordance with,
the applicable rules and regulations under the Exchange
Act and (2) the beneficial ownership of such security is
not also then reportable on Schedule 13D under the
Exchange Act (or any comparable or successor report); or
<PAGE>
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or
any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding (written or oral)
for the purpose of acquiring, holding, voting (except
pursuant to a revocable proxy or consent as described in
clause (ii)(B) of this definition) or disposing of any
securities of the Company or of HCI.
Notwithstanding the foregoing, nothing contained in this
definition shall cause a Person ordinarily engaged in business
as an underwriter of securities to be the "Beneficial Owner"
of, or to "beneficially own" or to have "Beneficial Ownership"
of, any securities acquired in a bona fide firm commitment
underwriting pursuant to an underwriting agreement with the
Company or with HCI.
"Book Value", when used with reference to Common
Shares issued by any Person, shall mean the amount of equity
of such Person applicable to each Common Share, determined (i)
in accordance with generally accepted accounting principles in
effect in the jurisdiction in which such Person is
incorporated and on the date as of which such Book Value is to
be determined, (ii) using all the consolidated assets and all
the consolidated liabilities of such Person on the date as of
which such Book Value is to be determined, except that no
value shall be included in such assets for goodwill arising
from consummation of a business combination, and (iii) after
giving effect to (A) the exercise of all rights, options and
warrants to purchase such Common Shares (other than the Rights
or the HCI Rights), and the conversion of all securities
convertible into such Common Shares, at an exercise or
conversion price, per Common Share, which is less than such
Book Value before giving effect to such exercise or conversion
(whether or not exercisability or convertibility is
conditioned upon occurrence of a future event), (B) all
dividends and other distributions on the capital stock of such
Person declared prior to the date as of which such Book Value
is to be determined and to be paid or made after such date,
and (C) any other agreement, arrangement or understanding
(written or oral), or transaction or other action contemplated
prior to the date as of which such Book Value is to be
determined that would have the effect of thereafter reducing
such Book Value.
SECTION 1.02. Section 1 of the Rights Agreement is
hereby amended, effective as of the date of this Amendment, by
adding the text of the following definitions:
<PAGE>
"Arrangement Agreement" shall mean the arrangement
agreement dated as of September 28, 1998, among Prime
Resources Group Inc., Homestake Canada Holdings Company, the
Company and HCI.
"HCI" shall mean Homestake Canada Inc., an Ontario
corporation.
"HCI Exchangeable Shares" shall mean the
Exchangeable Shares of HCI having the rights, privileges,
restrictions and conditions substantially set forth in
Schedule 2 to the Arrangement Agreement.
"HCI Rights" shall mean the rights to purchase HCI
Exchangeable Shares (or other securities) as provided in the
HCI Rights Agreement.
"HCI Rights Agreement" shall mean the Rights
Agreement dated as of December 3, 1998, between HCI and
Montreal Trust Company of Canada, as Rights Agent, as amended
from time to time.
"Homestake Special Voting Stock" shall mean the
Special Voting Stock of the Company, par value $1.00,
initially issued by the Company to and deposited with Montreal
Trust Company of Canada, as Trustee.
ARTICLE II
Miscellaneous
SECTION 2.01. Except to the extent amended by or
inconsistent with this Amendment No. 2, the Company and the
Rights Agent hereby ratify and reconfirm the Rights Agreement
in its entirety.
SECTION 2.02. This Amendment No. 2 may be executed
in any number of counterparts, each of which so executed shall
be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 2.03. THIS AMENDMENT NO. 2 SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER THE LAW OF THE STATE OF DELAWARE
AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF SUCH STATE APPLICABLE TO CONTRACTS
TO BE MADE AND PERFORMED ENTIRELY WITHIN SUCH STATE, PROVIDED,
HOWEVER, THAT THE RIGHTS AND
<PAGE>
OBLIGATIONS OF THE RIGHTS AGENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment No. 2 to be duly executed as of the day and
year first above written.
HOMESTAKE MINING COMPANY,
by
/s/ Wayne Kirk
----------------------
Name: Wayne Kirk
Title: Vice President
BANKBOSTON N.A.,
as Rights Agent,
by
/s/ B. Puschendorf
--------------------------
Name: Britta Puschendorf
Title: Sr. Acct. Manager
