REGISTRATION NO. 333-_____
As filed with the Securities and Exchange Commission on August 8, 1997
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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GOLDEN STAR RESOURCES LTD.
(Exact name of registrant as specified in its charter)
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CANADA 98-0101955
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1660 LINCOLN STREET, SUITE 3000
DENVER, COLORADO 80264
(303) 830-9000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
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DAVID A. FENNELL
GOLDEN STAR RESOURCES LTD.
1660 LINCOLN STREET, SUITE 3000
DENVER, COLORADO 80264
(303) 830-9000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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COPIES TO:
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<S> <C> <C>
LEONARD V. QUIGLEY LOUIS O. PELOQUIN BERNARD G. POZNANSKI
EDWIN S. MAYNARD GOLDEN STAR RESOURCES LTD. KOFFMAN BIRNIE & KALEF
PAUL, WEISS, RIFKIND, WHARTON & GARRISON 1660 LINCOLN STREET, SUITE 3000 885 W. GEORGIA STREET
1285 AVENUE OF THE AMERICAS DENVER, COLORADO 80264 VANCOUVER, BRITISH COLUMBIA V6C 3H4
NEW YORK, NEW YORK 10019-6064 (303) 830-9000 (604) 891-3688
(212) 373-3000
</TABLE>
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement, as determined
by the Registrant.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS AMOUNT TO OFFERING PRICE AGGREGATE REGISTRATION
OF SECURITIES TO BE REGISTERED BE REGISTERED(1) PER UNIT(2) OFFERING PRICE (3)(8) FEE(3)(8)
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Common Shares(4)...............
Preferred Shares(5)............
Convertible Debt Securities(6).
Warrants(7)....................
Total........................ $47,687,500 100% $47,687,500 $14,451
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(1) In U.S. dollars or the equivalent thereof in one or more foreign currencies
or currency units or composite currencies, including the European Currency
Unit.
(2) The proposed maximum initial offering price per unit will be determined,
from time to time, by the Registrant.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o). In no event will the aggregate initial offering
price of all securities issued from time to time pursuant to this
Registration Statement exceed $47,687,500, except as described in Footnote
(8), below.
(4) Subject to Footnote (3), there are being registered hereunder an
indeterminate number of shares of Common Shares as may be sold from time to
time by the Registrant. There are also being registered hereunder an
indeterminate number of shares of Common Shares as may be issued upon
conversion of the Convertible Debt Securities or Preferred Shares or upon
exercise of the Warrants.
(5) Subject to Footnote (3), there are being registered hereunder an
indeterminate number of shares of Preferred Shares as may be sold from time
to time by the Registrant or as may be issued upon exercise of the Warrants.
(6) Subject to Footnote (3), there are being registered hereunder an
indeterminate principal amount of Convertible Debt Securities as may be sold
from time to time by the Registrant or as may be issued upon exercise of the
Warrants. If any such Convertible Debt Securities are issued at an original
issue discount, then the offering price shall be in such greater principal
amount as shall result in an aggregate initial offering price of up to
$47,687,500.
(7) Subject to Footnote (3), there are being registered hereunder an
indeterminate number of Warrants as may be sold from time to time by the
Registrant.
(8) Pursuant to Rule 429(b) under the Securities Act of 1933, as amended, this
Registration Statement also shall include $52,312,500 in securities
registered pursuant to Registration Statement No. 333-12673, covering the
same classes of securities as set forth in the table above, for which the
registration fee of $18,039 was paid.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
Subject to Completion, Dated August 8, 1997
GOLDEN STAR RESOURCES LTD.
COMMON SHARES
PREFERRED SHARES
CONVERTIBLE DEBT SECURITIES
WARRANTS
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Golden Star Resources Ltd. (the "Company" or "Golden Star") may offer from
time to time (i) common shares without par value (the "Common Shares"), (ii)
first preferred shares (the "Preferred Shares") in one or more series, (iii)
convertible debt securities (the "Convertible Debt Securities"), consisting of
debentures, notes and/or other evidences of indebtedness representing unsecured
obligations of the Company convertible into Common Shares and (iv) warrants (the
"Warrants") to purchase Common Shares, Preferred Shares or Convertible Debt
Securities. The foregoing securities are collectively referred to as the
"Securities." Any Securities may be offered with other Securities or separately.
Securities may be sold for U.S. dollars, foreign currency or currency units,
including the European Currency Unit; amounts payable with respect to any
Convertible Debt Securities may likewise be payable in U.S. dollars, foreign
currency or currency units, including the European Currency Unit, in each case,
as the Company specifically designates. The amounts payable by the Company in
respect of Convertible Debt Securities may be calculated by reference to the
value, rate or price of one or more specified commodities, currencies or indices
as set forth in an accompanying Prospectus Supplement. The Securities will be
offered at an aggregate initial offering price not to exceed U.S. $100,000,000
or the equivalent (based on the applicable exchange rate at the time of sale) if
Convertible Debt Securities of the Company are issued in principal amounts
denominated in one or more foreign currencies or currency units as shall be
designated by the Company.
SEE "RISK FACTORS" COMMENCING ON PAGE 8 FOR CERTAIN CONSIDERATIONS
RELEVANT TO AN INVESTMENT IN THE SECURITIES.
This Prospectus will be supplemented by one or more accompanying
Prospectus Supplements, which will set forth with regard to the particular
Securities in respect of which this Prospectus is being delivered (i) in the
case of Common Shares, the number of Common Shares and the terms of the offering
thereof, (ii) in the case of Preferred Shares, the designation, aggregate
principal amount and stated value and liquidation preference per share, initial
public offering price, dividend rate (or method of calculation), dates on which
dividends shall be payable, any redemption or sinking fund provisions, any
conversion or exchange rights, whether the Company has elected to offer the
Preferred Shares as depositary shares, any listing of such Preferred Shares on a
securities exchange, and any other terms in connection with the offering and
sale of such Preferred Shares, (iii) in the case of Convertible Debt Securities,
title, aggregate principal amount, currency of denomination, maturity, interest
rate, if any (which may be fixed or variable), or method of calculation thereof,
time of payment of any interest, any terms for redemption at the option of the
Company or the holder, any terms for sinking fund payments, any index or other
method used to determine the amounts payable, the ranking of such Convertible
Debt Securities (whether senior, senior subordinated or subordinated), any
conversion rights, at the option of the Company or the holder, any listing on a
securities exchange, the initial public offering price and any other terms in
connection with the offering and sale of such Convertible Debt Securities, and
(iv) in the case of Warrants, the number and terms thereof, the number of shares
of Common Shares or Preferred Shares or amount of Convertible Debt Securities
issuable upon their exercise, the exercise price, the periods during which the
Warrants are exercisable, any listing of such Warrants on a securities exchange
and any other terms in connection with the offering, sale and exercise of such
Warrants. The Prospectus Supplement will also contain information, as
applicable, about certain United States and Canadian Federal income tax
considerations relating to the Securities in respect of which this Prospectus is
being delivered.
The Company's Common Shares are traded on the American Stock Exchange
under the symbol "GSR" and The Toronto Stock Exchange under the symbol "GSC."
Each Prospectus
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Supplement will indicate if the Securities offered thereby will be listed on any
securities exchange.
The Company may sell Securities to or through one or more underwriters,
and may also sell Securities directly to other purchasers or through agents. See
"Plan of Distribution." Each Prospectus Supplement will set forth the names of
any underwriters, dealers or agents involved in the sale of the Securities in
respect of which this Prospectus is being delivered, the principal amount, if
any, to be purchased by any such Underwriters, and any applicable fee,
commission or discount arrangements with them.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
The date of this Prospectus is , 1997.
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No dealer, salesman, or other person has been authorized to give any
information or to make any representations other than those contained in or
incorporated by reference in this Prospectus or in the Prospectus Supplement
and, if given or made, such information or representation must not be relied
upon as having been authorized by the Company or any underwriter, agent or
dealer. Neither the delivery of this Prospectus or the accompanying Prospectus
Supplement nor any sale made hereunder shall create, under any circumstances, an
implication that there has been no change in the facts set forth in this
Prospectus or the accompanying Prospectus Supplement, or in the affairs of the
Company since such date. Neither this Prospectus nor the accompanying Prospectus
Supplement constitutes an offer to sell or a solicitation of an offer to buy any
securities other than the securities offered hereby, nor do they constitute an
offer to sell or solicitation of an offer to buy any of the securities offered
hereby in any jurisdiction in which such offer or sale is unlawful or not
authorized or in any jurisdiction in which the person making such offer or
solicitation is not qualified to do so.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and in accordance therewith files,
reports, proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities of
the Commission at 450 Fifth Street N.W., Washington, D.C. 20549; and at its
regional offices located at Suite 1400, 500 West Madison Street, Chicago,
Illinois 60661- 2511; and 13th Floor, 7 World Trade Center, New York, New York
10048. Copies of such material can be obtained by mail from the Public Reference
Section of the Commission at 450 Fifth Street N.W., Washington, D.C. 20549, at
prescribed rates. The Company also is subject to the information and reporting
requirements of the securities regulatory authorities of certain provinces of
Canada and files similar reports, proxy statements and other information with
such authorities. Such reports, proxy statements and other information
concerning the Company also can be inspected and copied at the offices of the
American Stock Exchange, 86 Trinity Place, New York, New York 10006 and the
offices of The Toronto Stock Exchange, 2 First Canadian Place, Toronto Ontario,
Canada M5X 1J2. The Commission maintains a Web site that contains reports, proxy
and information statements and other information regarding registrants that file
electronically with the Commission. The address of the Commission's Web site is
http://www.sec.gov.
The Company has filed with the Commission a Registration Statement on Form
S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933 (the "Securities
Act") with respect of the Securities covered by this Prospectus. This
Prospectus, which forms part of the Registration Statement, does not contain all
of the information set forth in the Registration Statement, certain parts of
which have been omitted in accordance with the rules and regulations of the
Commission. For further information with respect to the Company and such
securities, reference is hereby made to such Registration Statement, including
the exhibits filed therewith. The Registration Statement and the exhibits
thereto can be obtained by mail from or inspected and copied at the public
reference facilities maintained by the Commission as provided in the prior
paragraph.
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ENFORCEMENT OF CERTAIN CIVIL LIABILITIES
Golden Star Resources Ltd. is a corporation subsisting under the laws of
Canada and certain of its directors and officers, as well as certain of the
experts named herein, are neither citizens nor residents of the United States. A
substantial part of the assets of several of such persons and of the Company are
located outside the United States. As a result, it may be difficult for
investors to effect service of process within the United States upon such
persons or to enforce against them or the Company within the United States
judgment of courts of the United States predicated upon the civil liability
provisions of the federal securities laws of the United States. There is doubt
as to the enforceability against such persons and Golden Star Resources Ltd. in
Canada, in original actions or actions to enforce judgments of United States
courts, of liabilities predicated solely upon the federal securities laws of the
United States.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated by reference in this Prospectus:
(1) Annual Report on Form 10-K for the year ended December 31, 1996,
filed with the Commission on March 31, 1997.
(2) Current Reports on Form 8-K, filed with the Commission on March 10,
1997 and May 8, 1997.
(3) Quarterly Report on Form 10-Q, filed with the Commission on May 15,
1997.
(4) 1997 Proxy Statement and Information Circular for the 1997 Annual
Meeting of Shareholders, filed with the Commission on April 29,
1997.
(5) The description of the Common Shares contained in the Company's
Articles (incorporated by reference to Exhibit 1.1 to the Company's
Registration Statement on Form 20-F, filed on May 10, 1993).
(6) The Company's Shareholder Rights Plan included in the Company's
Current Report on Form 8-K, filed with the Commission on May 8,
1996.
All documents subsequently filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act prior to the termination of the Offering
of the Securities offered hereby shall be deemed to be incorporated by reference
in this Prospectus and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference shall be deemed to be modified or superseded for
purposes of this Prospectus to the extent that a statement contained herein or
in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy of
this Prospectus is delivered, on the oral or written request of such person, a
copy of any or all of the documents incorporated herein by reference (other than
exhibits, unless such exhibits are specifically incorporated by reference in
such documents). Requests for such copies should be directed to the Secretary,
Golden Star Resources Ltd., 1660 Lincoln Street, Suite 3000, Denver, Colorado
80264, (303) 830-9000.
References in this Prospectus to the term "Golden Star" or to the term
"Company" refer to Golden Star Resources Ltd. and its consolidated subsidiaries,
including, without limitation,
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Guyanor Ressources S.A. ("Guyanor") and Pan African Resources Corporation
("PARC"), unless the context otherwise requires.
The information in this Prospectus is qualified in its entirety by the
more detailed information and consolidated financial statements and notes
thereto appearing in this Prospectus or incorporated by reference herein.
CANADIAN PROSPECTUSES
The Company is filing with certain Canadian securities regulatory
authorities a shelf prospectus relating to the potential offering in Canada of
up to 12,000,000 common shares (including the Common Shares offered hereunder)
and a shelf prospectus relating to the potential offering in Canada of
convertible debt securities at an aggregate initial offering price of up to U.S.
$100,000,000 (including the Convertible Debt Securities offered hereunder).
Canadian securities laws do not permit the use of an unallocated (as between
common shares and debt securities) shelf prospectus.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this Prospectus and any Prospectus Supplement
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 (the "Reform Act"). Such
forward-looking statements involve known and unknown risks, uncertainties, and
other factors which may cause the actual results, performance, or achievements
of the Company to be materially different from any future results, performance,
or achievements express or implied by such forward-looking statements. Such
factors include, among others, gold and diamond exploration and development
costs and results, fluctuation of gold prices, foreign operations and foreign
government regulation, competition, uninsured risks, recovery of reserves,
capitalization and commercial viability and requirements for obtaining permits
and licenses. See "Risk Factors."
REPORTING CURRENCY AND FINANCIAL INFORMATION
For the periods prior to May 15, 1992, the Company's reporting currency
was the Canadian dollar. In addition, the Company historically has raised most
of its equity capital in Canadian dollars. Since May 15, 1992, the Company's
reporting currency has been the United States dollar.
All amounts in this Prospectus and any Prospectus Supplement or
incorporated herein by reference are expressed in United States dollars, unless
otherwise indicated. References to (i) "Cdn" are to Canadian dollars, (ii) "FF"
are to French francs and (iii) "R" are to Brazilian reals.
Financial information is presented in accordance with generally accepted
accounting principles in Canada ("Canadian GAAP"). Differences between generally
accepted accounting principles in the United States ("U.S. GAAP") and Canadian
GAAP as applicable to the Company, are explained in the notes to the Company's
Consolidated Financial Statements incorporated by reference herein.
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THE COMPANY
Golden Star is an international gold and diamond exploration company with
a diverse portfolio of active exploration and development projects and an
operating mine in approximately ten countries on two continents. The Company's
core focus is on the acquisition, discovery and development of gold and diamond
projects. Once it identifies such projects, Golden Star's business strategy is,
if appropriate, to enter into partnership arrangements with major mining
companies to develop and operate mines. The Company currently has properties in
various stages of development in Guyana, French Guiana (through its
approximately 68% owned publicly traded subsidiary, Guyanor), Suriname, Brazil
and Bolivia in South America and Eritrea, Ethiopia, Gabon, Ivory Coast, Kenya
and Mali in Africa (through its approximately 64% owned publicly traded
subsidiary, PARC).
Golden Star is a substantial mining exploration organization, with over 70
professional geologists on staff and approximately 550 other employees working
in countries in which the Company has projects. The Company's efforts are
concentrated in a geologic domain known as greenstone belts, which are ancient
volcanic-sedimentary rock assemblages. Greenstone belts are known to be
favorable geologic environments for gold mineralization and account for a
significant proportion of the world's historic gold production. The Company
began its exploration activities in 1985 in the tropical, Proterozoic greenstone
belts of the Guiana Shield and more recently extended its activities to the
geologically related greenstone belts of the Brazilian Shield and the West
African Shield and finally to the greenstone belts of eastern Africa.
The head office of the Company is located at 1660 Lincoln Street, Suite
3000, Denver, Colorado 80264; its telephone number is (303) 830-9000. The
Company's registered and records office is located at 19th Floor, 885 West
Georgia Street, Vancouver, British Columbia V6C 3H4; its telephone number is
(604) 891-3688.
RISK FACTORS
PROSPECTIVE PURCHASERS OF SECURITIES SHOULD CAREFULLY READ THIS
PROSPECTUS, ANY PROSPECTUS SUPPLEMENT DELIVERED HEREWITH, AND THE DOCUMENTS
INCORPORATED BY REFERENCE HEREIN AND THEREIN. OWNERSHIP OF SECURITIES INVOLVES
CERTAIN RISKS. IN DETERMINING WHETHER TO PURCHASE SECURITIES, PROSPECTIVE
INVESTORS SHOULD CONSIDER CAREFULLY THE FOLLOWING RISK FACTORS AND THE OTHER
INFORMATION CONTAINED IN THIS PROSPECTUS, AS WELL AS THE OTHER RISK FACTORS AND
INFORMATION SET FORTH IN ANY PROSPECTUS SUPPLEMENT DELIVERED HEREWITH.
RISKS OF EXPLORATION AND DEVELOPMENT
Mineral exploration and development involves a high degree of risk and few
properties which are explored ultimately are developed into commercially
producing mines. The long-term success of the Company's operations will be
substantially and directly related to the cost and success of its exploration
programs. The risks associated with the exploration for new mineralization
include the identification of potential gold mineralization based on surficial
analysis, the attraction and retention of experienced geologists and drilling
personnel, the quality and availability of third party assaying, sampling
errors, geological, geophysical, geochemical and other technical analyses and
other factors. Substantial early stage expenditures are required to outline
mineralized prospects and establish ore reserves through, among other things,
drilling and the preparation of feasibility studies and mine plans, and to
develop and construct the mining and processing facilities at any site chosen
for mining. Although substantial benefits may be
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derived from the discovery of a major mineralized deposit, no assurance can be
given that (i) minerals will be discovered in sufficient quantities and/or
grades to constitute reserves or justify commercial operations, (ii) the Company
will be successful in partnering with companies to develop and operate those
properties that are commercially attractive on acceptable or attractive terms or
(iii) the funds required for development can be obtained by the Company or any
of its partners on a timely or commercially reasonable basis. Further, even if
reserves are delineated, it may require a number of years and significant
expenditures until production is possible, during which time the economic
feasibility of a property may change. Additionally, the Company will be reliant
on its partners in each project for technical expertise in the development and
operation phases of the project, and, in certain instances, for financing, until
cash flow is generated from the property for the Company's account. Finally, to
the extent the Company's mineral reserves are produced and sold, the Company
must continually acquire new mineral prospects and explore for and develop new
mineral reserves to replace such reserves.
UNCERTAINTY OF RESERVE AND OTHER MINERALIZATION ESTIMATES
There are numerous uncertainties inherent in estimating proven and
probable reserves and other mineralization, including many factors beyond the
control of the Company. The estimation of reserves and other mineralization is a
subjective process and the accuracy of any such estimate is a function of the
quality of available data and of engineering and geological interpretation and
judgment. Results of drilling, metallurgical testing and production and the
evaluation of mine plans subsequent to the date of any estimate may justify
revision of such estimates. No assurance can be given that the volume and grade
of reserves recovered and rates of production will not be less than anticipated.
Assumptions about prices are subject to great uncertainty and gold prices have
fluctuated widely in the past. Declines in the market price of gold or other
precious metals also may render reserves or other mineralization containing
relatively lower grades of mineralization or requiring more extensive processing
uneconomic to exploit. If the price realized by the Company for its gold bullion
were to decline substantially below the price at which ore reserves were
calculated for a sustained period of time, the Company potentially could
experience reductions in reserves and asset write-downs. Under such
circumstances, the Company may discontinue the development of a project or
mining at one or more of its properties. Further, changes in operating and
capital costs and other factors, including but not limited to short-term
operating factors such as the need for sequential development of ore bodies and
the processing of new or different ore grades, may materially and adversely
affect reserves.
RISKS ASSOCIATED WITH THE FLUCTUATION OF GOLD PRICES
To the extent that the Company has any revenues from operations, such
revenues are expected to be in large part derived from the mining and sale of
gold. The price of gold can fluctuate significantly, and recently has been at
depressed levels compared to its price in the past several years. The price of
gold is affected by numerous factors beyond the Company's control, including
international economic and political trends, inflation expectations, interest
rates, central bank sales and purchases, global or regional consumptive patterns
(such as the development of gold coin programs), speculative activities and
increased production due to new mine developments and improved mining and
production methods. The effect of these factors on the price of gold cannot be
accurately predicted.
The current demand for, and supply of, gold affect gold prices but not
necessarily in the same manner as current demand and supply affect the prices of
other commodities. The potential supply of gold consists of new mine production
plus existing stocks of bullion and fabricated gold held by governments,
financial institutions, industrial organizations and individuals. Since mine
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production in any single year constitutes a very small portion of the total
potential supply of gold, normal variations in current production do not
necessarily have a significant effect on the supply of gold or on its price. If
gold prices should decline below the Company's cash costs of production and
remain at such levels for any sustained period, the Company could determine that
it is not economically feasible to continue commercial production at any or all
of its mines or to pursue further exploration or development activities on such
properties.
Moreover, at the time the Company's ore reserves are estimated, the
parameters used in estimating such reserves are based on a variety of factors,
including the spot and future prices of gold at the time of such calculation. If
the Company were to determine that its reserves and future cash flows should be
recalculated at significantly lower gold prices than those that were used on the
measurement date, there would likely be a material reduction in the amount of
its gold reserves. Current gold prices are below the prices used in the
calculation of reserves at the Company's Omai, Gross Rosebel and Yaou
properties. In addition, should gold prices continue at current levels for an
extended period, delays in the development of certain projects may occur, and
material write-downs of the Company's investment in mining properties may be
required.
CAPITALIZATION AND COMMERCIAL VIABILITY
The Company has limited financial resources. To date, and for the
reasonably foreseeable future, its exploration and development activities have
not generated and are not expected to generate substantial revenues, which has
caused, and is expected to continue for the reasonably foreseeable future to
cause, the Company to incur losses. In addition, the Company historically has
incurred significant expenditures in connection with its exploration activities
and contemplates doing so for the foreseeable future. The Company's ability to
obtain financing may be negatively affected by the price of gold which recently
has been at depressed levels compared to its price in the past several years.
There can be no assurance that additional funding will be available to the
Company for further exploration or development of its properties or to fulfill
its obligations under any applicable agreements with its partners or the nations
in which the Company is operating. Although the Company has been successful in
the past in obtaining financing through the sale of equity securities and
through partnership arrangements involving several of the Company's properties,
there can be no assurance that the Company will be able to obtain adequate
financing in the future or that the terms of such financing will be favorable,
or that such partnership arrangements will continue to be available for the
Company's properties on acceptable terms. Failure to obtain such additional
financing could result in delay or indefinite postponement of further
exploration and development of the Company's properties with the possible loss
of the Company's interest in such properties.
If the Company proceeds to production on a particular property, commercial
viability will be affected by certain factors that are beyond the Company's
control, including the specific attributes of the deposit (such as mineral grade
and stripping ratio), the fluctuation in metal prices, the costs of constructing
and operating a mine in a specific environment, processing and refining
facilities, the availability of economic sources of energy, adequacy of water
supply, adequate access, government regulations including regulations relating
to prices, royalties, duties, taxes, restrictions on production, quotas on
exportation of minerals, as well as the costs of protection of the environment
and agricultural lands. In addition, a decrease in the price of gold, or a
continuation of the price of gold at depressed levels, could negatively affect
investment demand for the stock of gold exploration or mining companies,
including the Company, or may negatively impact the Company's stock price. The
occurrence of any such factors may materially and adversely affect the Company's
business, financial condition, results of operations and cash flow.
8
<PAGE>
RISKS ASSOCIATED WITH DIAMOND EXPLORATION
The exploration and development of diamond deposits involve exposure to
significant financial risks over a significant period of time. Very few
properties which are explored are ultimately developed into producing diamond
mines. Major expenses over a period of several years may be required to
establish reserves by sampling and drilling and to construct mining and
processing facilities at a site. It is impossible to ensure that the current
exploration programs of the Company, or any programs undertaken in the future
will result in a profitable commercial diamond mining operation.
Whether a diamond deposit will be commercially viable depends on a number
of factors, some of which are the particular attributes of the deposit, such as
its size, the size, quantity and quality of the diamonds, proximity to
infrastructure, financing costs and governmental regulations, including
regulations relating to prices, taxes, royalties, land tenure, land use,
importing and exporting of diamonds and environmental protection. The effect of
these factors cannot be accurately predicted, but the combination of these
factors may result in the Company not receiving an adequate return on invested
capital.
MARKETABILITY OF DIAMONDS
The marketability of diamonds which may result from projects undertaken by
the Company will be affected by numerous factors beyond the control of the
Company. These factors include market fluctuations, government regulations,
including regulations relating to prices, taxes, royalties, land tenure, land
use, importing and exporting of diamonds and environmental protection. The exact
effect of these factors cannot be accurately predicted, but the combination of
these factors may result in the Company not receiving an adequate return on
invested capital. The price for diamonds is, among other things, based on the
size, cut, color and quality of individual diamonds sold and, to a lesser
extent, the market supply and demand for diamonds in general.
RISKS OF FOREIGN OPERATIONS
In certain countries in which the Company has mineral rights (whether held
directly or indirectly), there are certain laws, regulations and statutory
provisions which, as currently written, could have a material negative impact on
the ability of the Company to develop a commercial mine in such countries. The
range and diversity of such laws and regulations are such that the Company could
not adequately summarize them in this document. Through, among other things, the
negotiation of mineral agreements with the governments of these countries,
management of the Company intends to seek variances or otherwise to be exempted
from the provisions of these laws, regulations and/or statutory provisions.
There can be no assurance, however, that the Company will be successful in
obtaining such mineral agreements, that any such variances or exemptions can be
obtained on commercially acceptable terms or that such agreements will be
enforceable in accordance with their terms.
Further, many of the mineral rights and interests of the Company are
subject to government approvals, licenses and permits. Such approvals, licenses
and permits are, as a practical matter, subject to the discretion of the
applicable governments or governmental officials. No assurance can be given that
the Company will be successful in obtaining any or all of such approvals,
licenses and permits, will obtain them in a timely fashion or will be able to
maintain them in full force and effect without modification or revocation.
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<PAGE>
The Company's assets and operations are subject to various political,
economic and other uncertainties, including, among other things, the risks of
war or civil unrest, expropriation, nationalization, renegotiation or
nullification of existing concessions, licenses, permits, approvals and
contracts, taxation policies, foreign exchange and repatriation restrictions,
changing political conditions, international monetary fluctuations, currency
controls and foreign governmental regulations that favor or require the awarding
of drilling contracts to local contractors or require foreign contractors to
employ citizens of, or purchase supplies from, a particular jurisdiction. In
addition, in the event of a dispute arising from foreign operations, the Company
may be subject to the exclusive jurisdiction of foreign courts or may not be
successful in subjecting foreign persons to the jurisdiction of courts in the
United States or Canada. The Company also may be hindered or prevented from
enforcing its rights with respect to a governmental instrumentality because of
the doctrine of sovereign immunity. The Company has suspended its operations in
Sierra Leone due to the unstable political situation there and has invoked the
FORCE MAJEURE provisions of the contracts pertaining to its Sierra Leone
operations. Currently, it is not possible for the Company to accurately predict
such developments or changes of law or policy and which, if any, of such
developments or changes may have a material adverse impact on the Company's
operations.
REQUIREMENTS FOR PERMITS AND LICENSES
The operations of the Company require licenses and permits from various
governmental authorities. Except as otherwise described in any Prospectus
Supplement delivered herewith or in documents incorporated by reference in this
Prospectus, management believes that the Company presently holds substantially
all necessary licenses and permits to carry on the activities which it currently
is conducting or expects to conduct in the near term under applicable laws and
regulations in respect of its properties, and also believes the Company is
presently complying in all material respects with the terms of such laws,
regulations, licenses and permits, although the Company is in breach of certain
provisions of such laws, regulations, licenses and permits from time to time.
Such licenses and permits are subject to modification or revocation as discussed
above in "Risks of Foreign Operations," as well as changes in regulations and in
various operating circumstances. While the Company does not believe that any
such breaches will have a material adverse effect on its operations, there can
be no assurance that the Company will be able to obtain or maintain in force all
necessary licenses and permits that may be required for it to conduct further
exploration or commence construction or operation of mining facilities at
properties under exploration or to maintain continued operations at economically
justifiable costs.
DEPENDENCE ON KEY PERSONNEL
The Company is dependent on the services of certain key officers and
employees, including its Chief Executive Officer, its Chief Financial Officer
and certain of its geologists. Competition in the mining exploration industry
for qualified individuals is intense, and the loss of any of these key officers
or employees if not replaced could have a material adverse effect on the
Company's business and its operations. The Company has entered into agreements
with certain of its officers which provide for payments upon termination without
cause or, in certain cases, upon a change in control of the Company.
OPERATIONAL HAZARDS AND RESPONSIBILITIES
The business of gold mining is generally subject to a number of risks and
hazards, including environmental hazards, the discharge of pollutants or
hazardous chemicals, industrial accidents, labor disputes, encountering unusual
or unexpected geological or operating conditions,
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<PAGE>
slope failures, cave-ins, failure of pit walls or dams and fire, changes in the
regulatory environment and natural phenomena such as inclement weather
conditions, floods and earthquakes, as well as other hazards. Such occurrences
could result in damage to, or destruction of, mineral properties or production
facilities, personal injury or death, environmental damage, delays in mining,
monetary losses and possible legal liability. The Company or its subsidiaries or
partnership arrangements to which they are parties also may incur liability as a
result of pollution and other casualties. The Company may not be able to insure
fully or at all against such risks, due to political or other reasons, or the
Company may decide not to insure against such risks as a result of high premiums
or for other reasons. Such occurrences, against which it cannot insure, or may
elect not to insure, may delay production, increase production costs or result
in liability. Paying compensation for obligations resulting from such liability
may entail significant costs for the Company and may have an adverse effect on
the Company's financial position. Furthermore, insurance against certain risks
(including certain liabilities for environmental pollution or other hazards as
result of exploration and production) is not generally available to the Company
or to other companies within the industry.
MINING AND PROCESSING
The Company's business operations are subject to risks and hazards
inherent in the mining industry, including but not limited to unanticipated
grade and other geological problems, water conditions, surface or underground
conditions, metallurgical and other processing problems and mechanical equipment
performance problems, the unavailability of materials and equipment, accidents,
labor force and FORCE MAJEURE factors, unanticipated transportation costs and
weather conditions, and prices and production levels of by-products, any of
which can materially and adversely affect, among other things, the development
of properties, production quantities and rates, costs and expenditures and
production commencement dates. In addition, the Company relies upon its partners
to manage the development and operating stages of the projects in which it has
an interest and, therefore, has less control over such matters than would be the
case if the Company were the operator.
In the case of the Company's exploration properties, there generally is no
operating history upon which to base estimates of future operating costs and
capital requirements. The economic feasibility of any individual project is
based upon, among other things, the interpretation of geological data obtained
from drill holes and other sampling techniques, feasibility studies, which
derive estimates of cash operating costs based upon anticipated tonnage and
grades of ore to be mined and processed, the configuration of the ore body,
expected recovery rates of metals from the ore, comparable facility and
equipment costs, anticipated climatic conditions, estimates of labor
productivity and other factors. Such exploration properties also are subject to
the successful completion of final feasibility studies, issuance of necessary
permits and receipt of adequate financing. Accordingly, uncertainties related to
operations are magnified in the case of exploration properties.
As a result of the foregoing risks, expenditures on any and all projects,
actual production quantities and rates and cash operating costs, among other
things, may be materially and adversely affected and may differ materially from
anticipated expenditures, production quantities and rates, and costs, just as
estimated production dates may be delayed materially, in each case, especially
to the extent exploration properties are involved. Any such events can
materially and adversely affect the Company's business, financial condition,
results of operations and cash flows.
11
<PAGE>
COMPETITION
The Company competes with major mining companies and other natural
resource companies in the acquisition, exploration, financing and development of
new properties and projects. Many of these companies are more experienced,
larger, and better capitalized than the Company. The Company's competitive
position will depend upon its ability to successfully and economically explore,
acquire and develop new and existing mineral resource properties or projects.
Factors which allow producers to remain competitive in the market over the long
term are the quality and size of the ore body, cost of production and operation
generally, and proximity to market. The Company also competes with other mining
companies for skilled geologists, geophysicists and other technical personnel,
which may result in higher turnover and greater labor costs for the Company.
CURRENCY
The Company historically has raised most of its equity capital in Canadian
dollars, primarily maintains its accounts in U.S. dollars and converts such U.S.
dollars into various local currencies on an as needed basis in order to conduct
local operations. The Company currently maintains all or the majority of its
working capital in U.S. dollars or U.S. dollar denominated securities and
converts funds to foreign currencies as payment obligations come due.
Accordingly, the Company is subject to fluctuations in the rates of currency
exchange between the U.S. dollar and these currencies, and such fluctuations may
materially affect the Company's financial position and results of operations.
The Company currently has future obligations which are payable in French francs
and Brazilian reals and receivables payable in French francs. The Company
currently does not actively take steps to hedge against such risks.
It is anticipated that, on January 1, 1999, the European Union will
commence the introduction of a single currency (the "Euro"), which will be legal
tender in substitution for the national currencies of those member states that
adopt the Euro. It is anticipated that the Council of the European Union and the
member states will adopt regulations providing specific rules for the
introduction of the Euro. The Company cannot predict when and if the Euro will
be adopted or what effect the adoption of the Euro may have, if any, with
respect to the Company's French franc denominated obligations and receivables.
GOVERNMENTAL REGULATIONS
Management believes that compliance with existing regulations in the
jurisdictions in which the Company operates which are applicable to the
discharge of materials into the environment, or otherwise relating to
environmental protection, will not have a material adverse effect on the
Company's exploration activities, earnings, expenditures or competitive
position. However, there can be no assurance that this will always be the case.
New or expanded regulations, if adopted, could affect the exploration or
development of the Company's mining projects or otherwise have a material
adverse effect on the operations of the Company.
RISK OF COMPANY BEING CLASSIFIED AS A PASSIVE FOREIGN INVESTMENT COMPANY
Under the United States Internal Revenue Code of 1986, as amended (the
"Code"), the Company may be classified as a passive foreign investment company
(a "PFIC"). United States shareholders of a PFIC are subject to certain adverse
tax consequences. These consequences can be mitigated, under certain
circumstances, if the United States shareholder makes a timely election to treat
the Company as a "qualified electing fund" (a "QEF") or, commencing January 1,
1998 (or later for taxpayers other than calendar year taxpayers), such United
States shareholder makes a timely "mark to market election" with respect to
shares deemed owned by such shareholder. The Company has been advised by Coopers
& Lybrand L.L.P. that it should not be treated as a PFIC with respect to shares
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purchased by United States shareholders during the years 1993 through 1996,
although it could potentially be a PFIC with respect to shares acquired by
United States shareholders prior to 1993. The Company also intends to engage
Coopers & Lybrand L.L.P., or such other advisor, in the future to analyze
whether it is a PFIC in 1997 and subsequent years and will continue to notify
shareholders of the results of such future analyses. There can be no assurance
as to whether or not Coopers & Lybrand L.L.P., or such other advisor, will
conclude that the Company is a PFIC for any such period. Moreover, even if
Coopers & Lybrand L.L.P., or such other advisor, concludes that the Company is
not a PFIC, its conclusion is not binding on the United States Internal Revenue
Service. Accordingly, it is possible that the PFIC rules will apply with respect
to holders of the Securities. If the Company is classified as a PFIC, the
consequences to United States holders of each type of Security may differ; in
particular, neither the QEF election nor the mark to market election may be
available to all types of the Securities. Such consequences will be further
described in the applicable Prospectus Supplement. ALL PROSPECTIVE PURCHASERS OF
THE SECURITIES IN THE UNITED STATES ARE URGED TO CONSULT THEIR OWN TAX ADVISORS
ABOUT THE ADVISABILITY OF MAKING A QEF ELECTION OR A MARK TO MARKET ELECTION
WITH RESPECT TO THE COMPANY. ALL PROSPECTIVE PURCHASERS OF THE SECURITIES IN THE
UNITED STATES ALSO ARE URGED TO REVIEW THE PROSPECTUS SUPPLEMENT CAREFULLY AND
TO CONSULT THEIR OWN TAX ADVISERS ABOUT THE POSSIBILITY OF CREDITING CANADIAN
TAXES PAID AGAINST UNITED STATES TAXES PAYABLE.
USE OF PROCEEDS
Unless a Prospectus Supplement indicates otherwise, the net proceeds to be
received by the Company from the issue and sale from time to time of the
Securities will be added to the general funds of the Company to be used to
finance the Company's operations and for other general corporate purposes.
Pending such application, such net proceeds may be invested in short-term
investment grade marketable securities. Each Prospectus Supplement will contain
specific information concerning the use of proceeds from the sale of Securities
to which it relates.
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges(1) for the Company and its
subsidiaries was as follows for the six months ended June 30, 1996 and 1997, the
years ended December 31, 1996, 1995, 1994 and 1993 and the periods from May 16,
1992 to December 31, 1992 and July 1, 1991 to May 15, 1992:
<TABLE>
<CAPTION>
PERIOD FROM PERIOD FROM
SIX MONTHS YEARS ENDED MAY 16, 1992 JULY 1, 1991
ENDED JUNE 30, DECEMBER 31, TO DECEMBER TO MAY 15,
1997 1996 1996 1995 1994 1993 31, 1992 1992
-------- -------- -------- -------- -------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
N/M N/M N/M N/M N/M N/M N/M N/M
</TABLE>
- -------------------------------
(1) The Company's projects are in the exploration or development stages. As a
result, the Company has reported net losses for each of the periods
presented. The Company has not had any material fixed charge obligations
for each of the periods presented. Therefore, the ratio of earnings to
fixed charges for the Company is not meaningful ("N/M") under both U.S.
GAAP and Canadian GAAP.
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DESCRIPTION OF SHARE CAPITAL
The Company's Articles currently authorize the issuance of an unlimited
number of Common Shares and an unlimited number of Preferred Shares, issuable in
series. As of July 27, 1997, 29,690,136 Common Shares and no Preferred Shares
were outstanding.
COMMON SHARES
The holders of Commons Shares are entitled to receive dividends as, when
and if declared by the Board of Directors of the Company out of funds legally
available therefor, provided that if any Preferred Shares are at the time
outstanding, the payment of dividends on Common Shares or other distributions
(including purchases of Common Shares) will be subject to any preferential
rights attaching to any other class or series of shares of the Company
The holders of Common Shares are entitled to one vote for each share on
all matters voted on by shareholders, including elections of directors. The
holders of Common Shares do not have any conversion, redemption or preemptive
rights. In the event of the dissolution, liquidation or winding up of the
Company, holders of Common Shares are entitled to share ratably in any assets
remaining after the satisfaction in full of the prior rights of creditors,
including holders of the Company's indebtedness, and the aggregate liquidation
preference of any other class or series of shares then outstanding.
On June 11, 1996, the shareholders of the Company confirmed the adoption
of a Shareholder Rights Plan (the "Rights Plan"). Pursuant to the Rights Plan,
the Company issued one right (a "Right") for each Common Share outstanding on
April 24, 1996 and will issue one Right for each Common Share issued in the
future. The terms of the Rights Plan are set forth in the Rights Agreement (the
"Rights Agreement") dated as of April 24, 1996 between the Company and CIBC
Mellon Trust Company as Rights Agent. For additional information on the Rights
Plan and the Rights Agreement, see the Company's Current Report on Form 8-K
filed with the Commission on May 8, 1996, incorporated by reference herein.
Any material United States or Canadian federal income tax consequences
with respect to any offered Common Shares will be described in the Prospectus
Supplement relating to the offering and sale of such Common Shares.
All outstanding Common Shares are, and the Common Shares offered hereby
will be, issued as fully paid and non-assessable.
The registrar and transfer agent for the Common Shares is CIBC Mellon
Trust Company. ChaseMellon Shareholder Services, L.L.C. acts as co-registrar and
co-transfer agent for the Common Shares in the United States.
PREFERRED SHARES
The following is a description of certain general terms and provisions of
the Preferred Shares. The particular terms of any series of Preferred Shares
will be described in the applicable Prospectus Supplement. If so indicated in a
Prospectus Supplement, the terms of any such series may differ from the terms
set forth below.
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The summary of the terms of the Company's Preferred Shares contained in
this Prospectus does not purport to be complete and is subject to, and qualified
in its entirety by, the provisions of the Company's Articles relating to each
series of Preferred Shares, which will be filed as an exhibit to or incorporated
by reference in this Prospectus at or prior to the time of issuance of any such
series of the Preferred Shares.
The Board of Directors of the Company is authorized to approve the
issuance of one or more series of Preferred Shares without further authorization
of the shareholders of the Company and to fix the number of shares, the
designations, rights, privileges, restrictions and conditions of any such
series.
The applicable Prospectus Supplement will set forth the number of shares,
particular designation, relative rights and preferences and the limitations of
any series of Preferred Shares in respect of which this Prospectus is delivered.
The particular terms of any such series will include the following:
(i) The maximum number of shares to constitute the series and the
designation thereof;
(ii) The annual dividend rate, if any, on shares of the series, whether
such rate is fixed or variable or both, the date or dates from which dividends
will begin to accrue or accumulate, whether dividends will be cumulative and
whether such dividends shall be paid in cash, Common Shares or otherwise;
(iii) Whether the shares of the series will be redeemable and, if so, the
price at and the terms and conditions on which the shares of the series may be
redeemed, including the time during which shares of the series may be redeemed
and any accumulated dividends thereon that the holders of shares of the series
shall be entitled to receive upon the redemption thereof;
(iv) The liquidation preference, if any, applicable to shares of the
series;
(v) Whether the shares of the series will be subject to operation of a
retirement or sinking fund and, if so, the extent and manner in which any such
fund shall be applied to the purchase or redemption of the shares of the series
for retirement or for other corporate purposes, and the terms and provisions
relating to the operation of such fund;
(vi) The terms and conditions, if any, on which the shares of the series
shall be convertible into, or exchangeable for, shares of any other class or
classes of capital stock of the Company or any series of any other class or
classes, or of any other series of the same class, including the price or prices
or the rate or rates of conversion or exchange and the method, if any, of
adjusting the same;
(vii) The voting rights, if any, of the shares of the series;
(viii) The currency or units based on or relating to currencies in which
such series is denominated and/or in which payments will or may be payable;
(ix) The methods by which amounts payable in respect of such series may be
calculated and any commodities, currencies or indices, or price, rate or value,
relevant to such calculation;
(x) Any listing of the shares of the series on a securities exchange; and
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<PAGE>
(xi) Any other preferences and relative, participating, optional or other
rights or qualifications, limitations or restrictions thereof.
Any material United States or Canadian federal income tax consequences and
other special considerations with respect to any offered Preferred Shares will
be described in the Prospectus Supplement relating to the offering and sale of
such Preferred Shares.
DESCRIPTION OF WARRANTS
The Company may issue Warrants to purchase Common Shares, Preferred Shares
or Convertible Debt Securities. Warrants may be issued, subject to regulatory
approvals, independently or together with any Common Shares, Preferred Shares or
Convertible Debt Securities, as the case may be and may be attached to or
separate from such Common Shares, Preferred Shares or Convertible Debt
Securities. Each series of Warrants will be issued under a separate warrant
agreement (each, a "Warrant Agreement") to be entered into between the Company
and a warrant agent (each, a "Warrant Agent"). The Warrant Agent will act solely
as an agent of the Company in connection with the Warrants of such series and
will not assume any obligation or relationship of agency or trust for or with
any holders or beneficial owners of Warrants. The following sets forth certain
general terms and provisions of the Warrants offered hereby. Further terms of
the Warrants and the applicable Warrant Agreement will be set forth in the
applicable Prospectus Supplement.
The applicable Prospectus Supplement will describe the following terms of
any Warrants in respect of which this Prospectus is being delivered; (1) the
title of such Warrants; (2) the securities (which may include Common Shares,
Preferred Shares or Convertible Debt Securities) for which such Warrants are
exercisable; (3) the price or prices at which such Warrants will be issued; (4)
the periods during which the Warrants are exercisable; (5) the number of Common
Shares, Preferred Shares or amount of Convertible Debt Securities for which each
Warrant is exercisable; (6) the exercise price for such Warrants, including any
changes to or adjustments in the exercise price; (7) the currency or currencies,
including composite currencies, in which the exercise price of such Warrants may
be payable; (8) if applicable, the designation and terms of the Preferred Shares
with which such Warrants are issued; (9) if applicable, the terms of the
Convertible Debt Securities with which such Warrants are issued; (10) the number
of Warrants issued with each Common Share or Preferred Share or the Convertible
Debt Securities; (11), if applicable, the date on and after which such Warrants
and the related Common Shares, Preferred Shares or Convertible Debt Securities
will be separately transferable; (12) any listing of the Warrants on a
securities exchange; (13) if applicable, a discussion of material United States
or Canadian federal income tax consequences and other special considerations
with respect to any Warrants; and (14) any other terms of such Warrants,
including terms, procedures and limitations relating to the exchange and
exercise of such Warrants.
DESCRIPTION OF CONVERTIBLE DEBT SECURITIES
The Convertible Debt Securities may be issued from time to time in one or
more series under an indenture among the Company, as issuer, and the trustee
specified in the applicable Prospectus Supplement. The following statements with
respect to the Convertible Debt Securities are subject to the detailed
provisions of the indenture, the form of which is filed as an exhibit to the
Registration Statement. Parenthetical references below are to the indenture (or
the form of security contained therein if so specified) and, whenever any
particular provision of the indenture
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<PAGE>
or any term used therein is referred to, such provision or term is incorporated
by reference as a part of the statement in connection with which such reference
is made, and the statement in connection with which such reference is made is
qualified in its entirety by such reference.
The Convertible Debt Securities will constitute either indebtedness
designated as Senior Indebtedness ("Senior Debt Securities"), indebtedness
designated as Senior Subordinated Indebtedness ("Senior Subordinated Debt
Securities") or indebtedness designated as Subordinated Indebtedness
("Subordinated Debt Securities"). Senior Debt Securities, Senior Subordinated
Debt Securities and Subordinated Debt Securities will each be issued under a
separate indenture (individually an "Indenture" and collectively the
"Indentures") to be entered into prior to the issuance of such Convertible Debt
Securities. The Indentures will be substantially identical, except for
provisions relating to subordination. See "Subordination of Senior Subordinated
Debt Securities and Subordinated Debt Securities". There will be a separate
Trustee (individually a "Trustee" and collectively the "Trustees") under each
Indenture. Information regarding the Trustee under an Indenture will be included
in any Prospectus Supplement relating to the Convertible Debt Securities issued
thereunder.
The particular terms of each series of Convertible Debt Securities, as
well as any modification or addition to the general terms of the Convertible
Debt Securities as herein described, which may be applicable to a particular
series of Convertible Debt Securities, are described in the Prospectus
Supplement relating to such series of Convertible Debt Securities and will be
set forth in a filing with the Commission. Accordingly, for a description of the
terms of a particular series of Convertible Debt Securities, reference must be
made to both the Prospectus Supplement relating to such series and to the
description of Convertible Debt Securities set forth in this Prospectus.
GENERAL
The Convertible Debt Securities offered pursuant to this Prospectus will
be limited to $100,000,000 aggregate principal amount (or (i) its equivalent
(based on the applicable exchange rate at the time of sale), if Convertible Debt
Securities are issued with principal amounts denominated in one or more foreign
currencies, composite currencies or currency units as shall be designated by the
Company, or (ii) such greater amount, if Convertible Debt Securities are issued
at an original issue discount, as shall result in aggregate proceeds of
$100,000,000 to the Company). The Indenture provides that additional convertible
debt securities may be issued thereunder up to the aggregate principal amount,
which is not limited by the Indenture, authorized from time to time by the
Company's Board of Directors or any duly authorized committee thereof. So long
as a single Trustee is acting for the benefit of the holders of all the
Convertible Debt Securities offered hereby and any such additional convertible
debt securities issued under the Indenture, the Convertible Debt Securities and
any such additional convertible debt securities are herein collectively referred
to as the "Indenture Securities." The Indenture also provides that there may be
more than one Trustee under the Indenture, each with respect to one or more
different series of Indenture Securities. At any time when two or more Trustees
are acting, each with respect to only certain series, the term "Indenture
Securities" as used herein shall mean the one or more series with respect to
which each respective Trustee is acting and the powers and the trust obligations
of each such Trustee as described herein shall extend only to the one or more
series of Indenture Securities for which it is acting as trustee. The effect of
the provisions contemplating that there might be more than one Trustee acting
for different series of Indenture Securities is that, in that event, those
Indenture Securities (whether of one or more than one series) for which each
Trustee is acting would be treated as if issued under a separate Indenture.
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<PAGE>
The applicable Prospectus Supplement will set forth a description of the
particular series of Convertible Debt Securities being offered thereby,
including but not limited to: (1) the designation or title of such Convertible
Debt Securities; (2) the aggregate principal amount of such Convertible Debt
Securities; (3) the percentage of their principal amount at which such
Convertible Debt Securities will be offered; (4) the date or dates on which the
principal of such Convertible Debt Securities will be payable and on which such
Convertible Debt Securities will mature; (5) the rate or rates (which may be
fixed or variable) at which such Convertible Debt Securities shall bear
interest, or the method of determination of such rate or rates at which such
Convertible Debt Securities shall bear interest, if any; (6) the date or dates
from which interest will accrue or the method of determination of such date or
dates, and the date or dates on which any such interest shall be payable; (7)
the currencies or currency units in which such Convertible Debt Securities are
issued or payable; (8) the terms for redemption, extension or early repayment of
such Convertible Debt Securities, if any; (9) if other than denominations of
$1,000 and any integral multiple thereof, the denominations in which such
Convertible Debt Securities are authorized to be issued; (10) the terms and
conditions upon which conversion will be effected, including the conversion
price, the conversion period and other conversion provisions; (11) the
provisions for a sinking fund, if any; (12) whether such Convertible Debt
Securities are issuable as a Global Security or Securities; (13) any index or
formula to be used to determine the amount of payments of principal, premium, if
any, and interest on such Convertible Debt Securities, and any commodities,
currencies, currency units or indices, or value, rate or price, relevant to such
determination; (14) if the principal of, premium, if any, or interest on such
Convertible Debt Securities is to be payable, at the election of the Company or
a Holder thereof, in one or more currencies or currency units other than that or
those in which such Convertible Debt Securities are stated to be payable, the
currencies or currency units in which payment of the principal of, premium, if
any, and interest on such Convertible Debt Securities as to which election is
made shall be payable, and the periods within which and the terms and conditions
upon which such election is to be made; (15) if other than the principal amount
thereof, the portion of the principal amount of such Convertible Debt Securities
of the series which will be payable upon acceleration of the Maturity thereof;
(16) whether such Convertible Debt Securities are subordinate in right of
payment to any Senior Indebtedness of the Company and, if so, the terms and
conditions of such subordination and the aggregate principal amount of such
Senior Indebtedness outstanding as of a recent date; (17) any covenants to which
the Company may be subject with respect to such Convertible Debt Securities;
(18) the applicability of the provisions described under "Defeasance" below;
(19) United States and Canadian Federal income tax consequences, if any; (20)
the provisions for the payment of additional amounts with respect to any
Canadian withholding taxes in certain cases; (21) any term or provision relating
to such Convertible Debt Securities which is not inconsistent with the
provisions of the Indenture; (22) the Trustee; and (23) any other special terms
pertaining to such Convertible Debt Securities. Unless otherwise specified in
the applicable Prospectus Supplement, the Convertible Debt Securities will not
be listed on any securities exchange.
One or more series of Convertible Debt Securities may be sold at a
substantial discount below their stated principal amount, bearing no interest or
interest at a rate which at the time of issuance is below market rates. Any
material United States or Canadian federal income tax consequences and other
special considerations with respect to any series of Convertible Debt Securities
will be described in the Prospectus Supplement relating to any such series of
Convertible Debt Securities.
If the purchase price of any series of Convertible Debt Securities is
denominated in a foreign currency or currencies or a foreign currency unit or
units or if the principal of, premium, if any, and interest on any series of
Convertible Debt Securities are payable in a foreign currency
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or currencies or a foreign currency unit or units, the restrictions, elections,
general tax considerations, specific terms and other information with respect to
such series of Convertible Debt Securities will be set forth in the applicable
Prospectus Supplement.
Convertible Debt Securities may be issued from time to time with payment
terms which are calculated by reference to the value, rate or price of one or
more commodities, currencies, currency units or indices. Holders of such
Convertible Debt Securities may receive a principal amount (including premium,
if any) on any principal payment date, or a payment of interest on any interest
payment date, that is greater than or less than the amount of principal
(including premium, if any) or interest otherwise payable on such dates,
depending upon the value, rate or price on the applicable dates of the
applicable currency, currency unit, commodity or index. Information as to the
methods for determining the amount of principal, premium, if any, or interest
payable on any date, the currencies, currency units, commodities or indices to
which the amount payable on such date is linked and any additional tax
considerations will be set forth in the applicable Prospectus Supplement.
Except as may be set forth in the applicable Prospectus Supplement,
Holders of Convertible Debt Securities will not have the benefit of any specific
covenants or provisions in the applicable Indenture or such Convertible Debt
Securities in the event that the Company engages in or becomes the subject of a
highly leveraged transaction, other than the limitations on mergers,
consolidations and transfers of substantially all of the Company's properties
and assets as an entirety to any person as described below under "Consolidation,
Merger and Sale of Assets".
The Convertible Debt Securities will be general unsecured obligations of
the Company.
Except as otherwise provided in the applicable Prospectus Supplement,
principal, premium, if any, and interest, if any, will be payable at an office
or agency to be maintained by the Company in ____________, except that at the
option of the Company interest may be paid by check mailed to the person
entitled thereto.
The Convertible Debt Securities will be issued only in fully registered
form without coupons and may be presented for the registration of transfer or
exchange at the corporate trust office of the Trustee. Not all Convertible Debt
Securities of any one series need be issued at the same time, and, unless
otherwise provided, a series may be reopened for issuances of additional
Convertible Debt Securities of such series.
SENIOR DEBT SECURITIES
The Senior Debt Securities will rank PARI PASSU with all other unsecured
and unsubordinated debt of the Company and senior to the Senior Subordinated
Debt Securities and Subordinated Debt Securities.
SUBORDINATION OF SENIOR SUBORDINATED DEBT SECURITIES AND SUBORDINATED DEBT
SECURITIES
The payment of the principal of, premium, if any, and interest on the
Senior Subordinated Debt Securities and the Subordinated Debt Securities will,
to the extent set forth in the respective Indentures and Indenture Supplements
governing such Senior Subordinated Debt Securities and Subordinated Debt
Securities, be subordinated in right of payment to the prior payment in full of
all Senior Indebtedness. Upon any payment or distribution of assets to creditors
upon any liquidation, dissolution, winding up, reorganization, assignment for
the benefit of creditors,
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marshalling of assets or any bankruptcy, insolvency or similar proceedings of
the Company, the holders of all Senior Indebtedness will be entitled to receive
payment in full of all amounts due or to become due thereon before the Holders
of the Senior Subordinated Debt Securities or the Subordinated Debt Securities
will be entitled to receive any payment in respect of the principal of, premium,
if any, or interest on such Senior Subordinated Debt Securities or Subordinated
Debt Securities, as the case may be. In the event of the acceleration of the
maturity of any Senior Subordinated Debt Securities or Subordinated Debt
Securities, the holders of all Senior Indebtedness will be entitled to receive
payment in full of all amounts due or to become due thereon before the Holders
of the Senior Subordinated Debt Securities or Subordinated Debt Securities, as
the case may be, will be entitled to receive any payment upon the principal of,
premium, if any, or interest on such Senior Subordinated Debt Securities or
Subordinated Debt Securities, as the case may be. No payments on account of
principal, premium, if any, or interest in respect of the Senior Subordinated
Debt Securities or Subordinated Debt Securities may be made if there shall have
occurred and be continuing in a default in the payment of principal of (or
premium, if any) or interest on any Senior Indebtedness beyond any applicable
grace period, or a default with respect to any Senior Indebtedness permitting
the holders thereof to accelerate the maturity thereof, or if any judicial
proceedings shall be pending with respect to any such default. For purposes of
the subordination provisions, the payment, issuance or delivery of cash,
property or securities (other than stock, and certain subordinated securities,
of the Company) upon conversion or exchange or a Senior Subordinated Debt
Security or Subordinated Debt Security will be deemed to constitute payment on
account of the principal of such Senior Subordinated Debt Security or
Subordinated Debt Security, as the case may be.
By reason of such provisions, in the event of insolvency, holders of
Senior Subordinated Debt Securities and Subordinated Debt Securities may recover
less, ratably, than holders of Senior Indebtedness with respect thereto.
The term "Senior Indebtedness", when used with respect to any series of
Senior Subordinated Debt Securities or Subordinated Debt Securities, is defined
to include all amounts due on and obligations in connection with any of the
following, whether outstanding at the date of execution of the Indenture or
thereafter incurred, assumed, guaranteed or otherwise created (including,
without limitation, interest accruing on or after a bankruptcy or other similar
event, whether or not an allowed claim therein):
(a) indebtedness, obligations and other liabilities (contingent or
otherwise) of the Company for money borrowed or evidenced by bonds,
debentures, notes or similar instruments;
(b) reimbursement obligations and other liabilities (contingent or
otherwise) of the Company with respect to letters of credit or
bankers' acceptances issued for the account of the Company and
interest rate protection agreements and currency exchange or
purchase agreements;
(c) obligations and liabilities (contingent or otherwise) of the Company
related to capitalized lease obligations;
(d) indebtedness, obligations and other liabilities (contingent or
otherwise) of the Company related to agreements or arrangements
designed to protect the Company against fluctuations in commodity
prices, including without limitation, commodity futures contracts or
similar hedging instruments;
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(e) indebtedness of others of the kinds described in the preceding
clauses (a) through (d) that the Company has assumed, guaranteed or
otherwise assured the payment of, directly or indirectly;
(f) indebtedness of another Person of the type described in the
preceding clauses (a) through (e) secured by any mortgage, pledge,
lien or other encumbrance on property owned or held by the Company;
and
(g) deferrals, renewals, extensions and refundings of, or amendments,
modifications or supplements to, any indebtedness, obligation or
liability described in the preceding clauses (a) through (f) whether
or not there is any notice to or consent of the Holders of such
series of Senior Subordinated Debt Securities or Subordinated Debt
Securities, as the case may be;
except that, with respect to the Senior Subordinated Debt Securities, any
particular indebtedness, obligation, liability, guaranty, assumption, deferral,
renewal, extension or refunding shall not constitute "Senior Indebtedness" if it
is expressly stated in the governing terms, or in the assumption or guarantee,
thereof that the indebtedness involved is not senior in right of payment to the
Senior Subordinated Debt Securities or that such indebtedness is PARI PASSU with
or junior to the Senior Subordinated Debt Securities and, with respect to
Subordinated Debt Securities, any particular indebtedness, obligation,
liability, guaranty, assumption, deferral, renewal, extension or refunding shall
not constitute "Senior Indebtedness" if it is expressly stated in the governing
terms, or in the assumption or guarantee, thereof that the indebtedness involved
is not senior in right of payment to the Subordinated Debt Securities or that
such indebtedness is PARI PASSU with or junior to the Subordinated Debt
Securities.
In certain circumstances, such as the bankruptcy or insolvency of the
Company, Canadian or U.S. bankruptcy or insolvency legislation may be applicable
and the application of such legislation may lead to different results with
respect to, for example, payments to be made to Holders of Convertible Debt
Securities, or priorities between Holders of the Convertible Debt Securities and
holders of Senior Indebtedness, than those provided for in the applicable
Indenture.
If this Prospectus is being delivered in connection with a series of
Senior Subordinated Debt Securities or Subordinated Debt Securities, the
accompanying Prospectus Supplement or the information incorporated herein by
reference will set forth the approximate amount of Senior Indebtedness
outstanding as of the end of the Company's most recent fiscal quarter.
FORM, EXCHANGE, REGISTRATION, CONVERSION, TRANSFER AND PAYMENT
Unless otherwise indicated in the applicable Prospectus Supplement, the
Convertible Debt Securities will be issued only in fully registered form in
denominations of U.S. $1,000 or integral multiples thereof. Unless otherwise
indicated in the applicable Prospectus Supplement, payment of principal,
premium, if any, and interest on the Convertible Debt Securities will be
payable, and the exchange, conversion and transfer of Convertible Debt
Securities will be registerable, at the office or agency of the Company
maintained for such purposes. No service charge will be made for any
registration of a transfer or exchange of the Convertible Debt Securities, but
the Company may require payment of a sum sufficient to cover any tax or other
governmental charge imposed in connection therewith.
All monies paid by the Company to a Paying Agent for the payment of
principal of, premium, if any, or interest on any Convertible Debt Security
which remain unclaimed for two
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years after such principal, premium or interest has become due and payable may
be repaid to the Company and thereafter the holder of such Convertible Debt
Security may look only to the Company for payment thereof.
EVENTS OF DEFAULT
The following will be Events of Default under the Indenture with respect
to Convertible Debt Securities of any series: (a) failure to pay principal (or
premium, if any) on any Convertible Debt Security of that series at its
maturity, whether or not such failure is a result of the subordination
provisions of the Indenture with respect to such series; (b) failure to pay any
interest on any Convertible Debt Security of that series when due, continued for
30 days, whether or not such failure is a result of the subordination provisions
of the Indenture with respect to such series; (c) failure to make any sinking
fund payment, when due, in respect of any Convertible Debt Security of that
series; (d) failure to perform any other covenant of the Company in the
applicable Indenture or any other covenant to which the Company may be subject
with respect to Convertible Debt Securities of that series (other than a
covenant solely for the benefit of a series of Convertible Debt Securities other
than that series), continued for 90 days after written notice as provided in the
applicable Indenture; (e) failure to pay when due on final maturity (after the
expiration of any applicable grace period), or upon acceleration, any
indebtedness for money borrowed by the Company in excess of U.S. $10 million;
(f) certain events of bankruptcy, insolvency or reorganization; and (g) any
other Event of Default provided with respect to Convertible Debt Securities of
that series.
If an Event of Default with respect to outstanding Convertible Debt
Securities of any series shall occur and be continuing, either the Trustee or
the Holders of at least 25% in principal amount of the outstanding Convertible
Debt Securities of that series, by notice as provided in the applicable
Indenture, may declare the principal amount (or, if the Convertible Debt
Securities of that series are original issue discount securities, such portion
of the principal amount as may be specified in the terms of that series) of all
Convertible Debt Securities of that series to be due and payable immediately,
except that upon the occurrence of an Event of Default specified in (f) above,
the principal amount (or in the case of original issue discount securities, such
portion) of all Convertible Debt Securities shall be immediately due and payable
without notice. However, at any time after a declaration of acceleration with
respect to Convertible Debt Securities of any series has been made, but before
judgment or decree based on such acceleration has been obtained, the Holders of
a majority in principal amount of the outstanding Convertible Debt Securities of
that series may, under certain circumstances, rescind and annul such
acceleration. For information as to waiver of defaults, see "Modification and
Waiver" below.
The Indentures will provide that, subject to the duty of the respective
Trustees thereunder during an Event of Default to act with the required standard
of care, each such Trustee will be under no obligation to exercise any of its
rights or powers under the respective Indentures at the request or direction of
any of the Holders, unless such Holders shall have offered to such Trustee
reasonable security or indemnity. Subject to certain provisions, including those
requiring security or indemnification of the applicable Trustee, the Holders of
a majority in principal amount of the outstanding Convertible Debt Securities of
any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to such Trustee, or to
exercise any trust or power conferred on such Trustee, with respect to the
Convertible Debt Securities of that series.
No Holder of a Convertible Debt Security of any series will have any right
to institute any proceeding with respect to the applicable Indenture or for any
remedy thereunder, unless such
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Holder shall have previously given to the applicable Trustee written notice of a
continuing Event of Default and unless also the Holders of at least 25% in
aggregate principal amount of the outstanding Convertible Debt Securities of the
same series shall have made written requests, and offered reasonable indemnity,
to such Trustee to institute such proceeding as trustee, and the Trustee shall
not have received from the Holders of a majority in aggregate principal amount
of the outstanding Convertible Debt Securities of the same series a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days. However, such limitations do not apply to a suit
instituted by a Holder of a Convertible Debt Security for enforcement of payment
of the principal of and interest on such Convertible Debt Security on or after
the respective due dates expressed in such Convertible Debt Security.
The Company will be required to furnish to the Trustees annually a
statement as to the performance by the Company of its obligations under the
respective Indentures and as to any default in such performance.
MODIFICATION AND WAIVER
Without the consent of any Holder of outstanding Convertible Debt
Securities, the Company and the Trustees may amend or supplement the Indentures
or the Convertible Debt Securities to cure any ambiguity, defect or
inconsistency, or to make any change that does not adversely affect the rights
of any Holder of Convertible Debt Securities. Other modifications and amendments
of the respective Indentures may be made by the Company and the applicable
Trustee with the consent of the Holders of not less than a majority in aggregate
principal amount of the outstanding Convertible Debt Securities of each series
affected thereby; provided, however, that no such modification or amendment may,
without the consent of the Holder of each outstanding Convertible Debt Security
affected thereby: (a) change the stated maturity of the principal of, or any
installment of principal of, or premium, if any, or interest on any Convertible
Debt Security; (b) reduce the principal amount of, the rate of interest on, or
the premium, if any, payable upon the redemption of, any Convertible Debt
Security; (c) reduce the amount of principal of an original issue discount
security payable upon acceleration of the maturity thereof; (d) change the place
or currency of payment of principal of, premium, if any, or interest on any
Convertible Debt Security; (e) impair the right to institute suit for the
enforcement of any payment on or with respect to any Convertible Debt Security
on or after the stated maturity or redemption date thereof; (f) modify the
conversion provisions in a manner adverse to the holders thereof; (g) modify the
subordination provisions applicable to Senior Subordinated Debt Securities or
Subordinated Debt Securities in a manner adverse to the Holders thereof; (h)
reduce the percentage in principal amount of outstanding Convertible Debt
Securities of any series, the consent of the Holders of which is required for
modification or amendment of the applicable Indenture or for waiver of
compliance with certain provisions of the applicable Indenture or for waiver of
certain defaults or (i) modify any of the provisions of certain sections as
specified in the Indenture including the provisions summarized in this
paragraph, except to increase any such percentage or to designate additional
provisions of the Indenture, which, with respect to such series, cannot be
modified or waived without the consent of the Holder of each outstanding
Convertible Debt Security affected thereby.
The Holders of at least a majority in principal amount of the outstanding
Convertible Debt Securities of any series may on behalf of the Holders of all
Convertible Debt Securities of that series waive, insofar as that series is
concerned, compliance by the Company with certain covenants of the applicable
Indenture. The Holders of not less than a majority in principal amount of the
outstanding Convertible Debt Securities of any series may, on behalf of the
Holders of all Convertible Debt Securities of that series, waive any past
default under the
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applicable Indenture with respect to that series, except a default in the
payment of the principal of, premium, if any, or interest on, any Convertible
Debt Security of that series or in respect of a provision which under the
applicable Indenture cannot be modified or amended without the consent of the
Holder of each outstanding Convertible Debt Security of that series affected.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of any Holders of any series of
outstanding Convertible Debt Securities, may consolidate with or merge into, or
transfer or lease its assets substantially as an entirety (treating the Company
and each of its Subsidiaries as a single consolidated entity) to, any
corporation, and any other corporation may consolidate with or merge into, or
transfer or lease its assets substantially as an entirety to, the Company,
provided that the corporation (if other than the Company) formed by such
consolidation or into which the Company is merged or which acquires or leases
the assets of the Company substantially as an entirety is organized and existing
under the laws of the United States of America or Canada or any political
subdivision of either, and assumes the Company's obligations under each series
of outstanding Convertible Debt Securities and the Indentures applicable thereto
and that the Trustee is satisfied that the transaction will not result in the
successor being required to make any deduction or withholding on account of
certain Canadian taxes from any payments in respect of the Securities, and that,
after giving effect to such transaction, no Event of Default, and no event
which, after notice or lapse of time or both, would become an Event of Default,
shall have occurred and be continuing, and the delivery of an officer's
certificate and an opinion of counsel with respect to compliance with the
foregoing requirements.
DEFEASANCE
If so indicated in the applicable Prospectus Supplement with respect to
the Convertible Debt Securities of a series, the Company at its option will be
released from its obligations to comply with certain covenants specified in the
applicable Prospectus Supplement with respect to the Convertible Debt Securities
of such series, and the occurrence of an event described in clause (d) under
"Events of Default" above with respect to any defeased covenants, and clauses
(e) and (g) under "Events of Default" above shall no longer be an Event of
Default, if the Company irrevocably deposits with the applicable Trustee, in
trust, money, government obligations of the government issuing the currency in
which the Convertible Debt Securities of the relevant series are denominated, or
a combination thereof that through the payment of interest thereon and principal
thereof in accordance with the terms will provide money in an amount sufficient
to pay all the principal of and premium, if any, and interest on the Securities
of such series on the dates such payments are due (up to the stated maturity
date, or the redemption date, as the case may be) in accordance with the terms
of such Convertible Debt Securities. Such a trust may only be established if,
among other things, (a) no Event of Default described under "Events of Default"
above or event that, after notice or lapse of time, or both, would become an
Event of Default under the applicable Indenture, shall have occurred and be
continuing on the date of such deposit, or, with regard to an Event of Default
described under clause (f) under "Events of Default" above or an event that,
after notice or lapse of time, or both, would become an Event of Default
described under such clause (f), shall have occurred and be continuing at any
time during the period ending on the 123rd day following such date of deposit,
(b) the Company shall have delivered an opinion of counsel to the effect that
the Holders of the Convertible Debt Securities will not recognize gain or loss
for United States Federal income tax purposes as a result of such deposit or
defeasance and will be subject to United States Federal income tax in the same
manner as if such defeasance had not occurred, and (c) such covenant defeasance
will not result in the trust being in violation of the Investment Company Act of
1940. In the event the Company omits
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to comply with its remaining obligations under the applicable Indenture after a
defeasance of such Indenture with respect to the Convertible Debt Securities of
any series as described above and the Convertible Debt Securities of such series
are declared due and payable because of the occurrence of any undefeased Event
of Default, the amount of money and government obligations on deposit with the
applicable Trustee may be insufficient to pay amounts due on the Convertible
Debt Securities of such series at the time of the acceleration resulting from
such Event of Default.
However, the Company will remain liable in respect to such payments.
Notwithstanding the description set forth under "Subordination of Senior
Subordinated Debt Securities and Subordinated Debt Securities" above, in the
event that the Company deposits money or government obligations in compliance
with the Indenture that governs any Senior Subordinated Debt Securities or
Subordinated Debt Securities, as the case may be, in order to defease all or
certain of its obligations with respect to the applicable series of Convertible
Debt Securities, the money or government obligations so deposited will not be
subject to the subordination provisions of the applicable Indenture and the
indebtedness evidenced by such series of Convertible Debt Securities will not be
subordinated in right of payment to the holders of applicable Senior
Indebtedness to the extent of the money or government obligations so deposited.
GOVERNING LAW
The Indentures and the Convertible Debt Securities will be governed by,
and construed in accordance with, the laws of the State of New York.
REGARDING THE TRUSTEES
The Indenture contains certain limitations on the right of each Trustee,
should it become a creditor of the Company, to obtain payment of claims in
certain cases, or to realize for its own account on certain property received in
respect of any such claim as security or otherwise. Each Trustee will be
permitted to engage in certain other transactions with the Company; however, if
it acquires any conflicting interest and there is a default under the
Convertible Debt Securities issued under the applicable Indenture, it must
eliminate such conflict or resign.
BOOK-ENTRY SYSTEM
The Convertible Debt Securities of a Series may be issued in the form of
one or more global certificates representing the Convertible Debt Securities
(the "Global Securities") that will be deposited with a depository (the
"Depository") or with a nominee for the Depository identified in the applicable
Prospectus supplement and will be registered in the name of the Depository or a
nominee thereof. In such a case one or more Global Securities will be issued in
a denomination or aggregate denominations equal to the portion of the aggregate
principal amount of outstanding Convertible Debt Securities of the series to be
represented by such Global Security or Securities. Unless and until it is
exchanged in whole or in part for Convertible Debt Securities in definitive
certificated form, a Global Security may be transferred, in whole but not in
part, only to another nominee of the Depository for such series, or to a
successor Depository for such series selected or approved by the Company, or to
a nominee of such successor Depository.
The specific depository arrangement with respect to any series of
Convertible Debt Securities to be represented by a Global Security will be
described in the applicable Prospectus Supplement. The Company expects that the
following provisions will apply to depository arrangements.
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Upon the issuance of any Global Security, and the deposit of such Global
Security with or on behalf of the Depository for such Global Security, the
Depository will credit, on its book-entry registration and transfer system, the
respective principal amounts of the Convertible Debt Securities represented by
such Global Security to the accounts of institutions ("participants") that have
accounts with the Depository or its nominee. The accounts to be credited will be
designated by the underwriters or agents engaging in the distribution of such
Convertible Debt Securities or by the Company, if such Convertible Debt
Securities are offered and sold directly by the Company. Ownership of beneficial
interests in a Global Security will be limited to participants or persons that
may hold interests through participants. Ownership of beneficial interests by
participants in such Global Security will be shown on, and the transfer of such
beneficial interests will be effected only through, records maintained by the
Depository for such Global Security or by its nominee. Ownership of beneficial
interests in such Global Security by persons that hold through participants will
be shown on, and the transfer of such beneficial interests within such
participants will be effected only through, records maintained by such
participants. The laws of some jurisdictions may require that certain purchasers
of securities take physical delivery of such securities in certificated form.
The foregoing limitations and such laws may impair the ability to own, pledge or
transfer beneficial interests in such Global Securities.
So long as the Depository for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depository or such nominee, as
the case may be, will be considered the sole owner or holder of the Convertible
Debt Securities represented by such Global Security for all purposes under the
Indenture. Unless otherwise specified in the applicable Prospectus Supplement
and except as specified below, owners of beneficial interests in such Global
Security will not be entitled to have Convertible Debt Securities of the series
represented by such Global Security registered in their names, will not receive
or be entitled to receive physical delivery of Convertible Debt Securities of
such series in certificated form and will not be considered the holders thereof
for any purposes under the Indenture. Accordingly, each person owning a
beneficial interest in such Global Security must rely on the procedures of the
Depository and, if such person is not a participant, on the procedures of the
participant through which such person owns its interest, to exercise any rights
of a holder under the Indenture. The Company understands that, under existing
industry practices, if the Company requests any action of holders or an owner of
a beneficial interest in such Global Security desires to give any notice or take
any action a holder is entitled to give or take under the Indenture, the
Depository would authorize the participants to give such notice or take such
action, and participants would authorize beneficial owners owning through such
participants to give such notice or take such action or would otherwise act upon
the instructions of beneficial owners owning through them.
Unless otherwise specified in the applicable Prospectus Supplement,
payments with respect to principal, premium, if any, and interest, if any, on
Convertible Debt Securities represented by a Global Security registered in the
name of a Depository or its nominee will be made to such Depository or its
nominee, as the case may be, as the registered owner of such Global Security.
The Company expects that the Depository for any Convertible Debt
Securities represented by a Global Security, upon receipt of any payment of
principal, premium or interest in respect of such Global Security, will
immediately credit participants' accounts with payments in amounts proportionate
to their respective beneficial interests in the principal amount of such Global
Security as shown on the records of such Depository. The Company also expects
that payments by participants to owners of beneficial interests in such Global
Security held through such participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers registered in "street names," and will be the
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responsibility of such participants. None of the Company, the Trustee or any
agent of the Company or the Trustee shall have any responsibility or liability
for any aspect of the records relating to or payments made on account of
beneficial ownership interests of a Global Security, or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
If the Depository for any Convertible Debt Securities represented by a
Global Security is at any time unwilling or unable to continue as Depository or
ceases to be registered or in good standing under the Securities Exchange Act of
1934, as amended, and a successor Depository is not appointed by the Company
within 90 days after the Company receives notice or becomes aware of such
condition, the Company will issue such Convertible Debt Securities in definitive
certificated form in exchange for such Global Security. In addition, the Company
may at any time and in its sole discretion determine not to have any of the
Convertible Debt Securities of a series represented by one or more Global
Securities and, in such event, will issue Convertible Debt Securities of such
series in definitive certificated form in exchange for all of the Global
Security or Securities representing such Convertible Debt Securities.
PLAN OF DISTRIBUTION
The Company may offer and sell the Securities to or through underwriters
or dealers, and also may offer and sell Securities directly to other purchasers
or through agents.
Each Prospectus Supplement will set forth the terms of the offering of the
particular series of Securities to which the Prospectus Supplement relates,
including the name or names of any underwriters, dealers or agents, the purchase
price or prices of the Securities, the proceeds to the Company from the sale of
such series of Securities, the use of such proceeds, any initial public offering
price or purchase price of such series of Securities, any underwriting discount
or commission, any discounts, concessions or commissions allowed or reallowed or
paid by any underwriters to other dealers, any commissions paid to any agents
and the securities exchanges, if any, on which such Securities will be listed.
Any initial public offering price or purchase price and any discounts,
concessions or commissions allowed or reallowed or paid by any underwriter to
other dealers may be changed from time to time.
Sales of Common Shares or Preferred Shares offered pursuant to any
Prospectus Supplement may be effected from time to time in one or more
transactions on the American Stock Exchange or, in appropriate circumstances,
The Toronto Stock Exchange, or in negotiated transactions or any combination of
such methods of sale, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices, or at other negotiated prices.
In connection with the sale of Securities, underwriters or agents may
receive compensation from the Company or from purchasers of Securities for whom
they may act as agents in the form of discounts, concessions or commissions,
Underwriters may sell Securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act as
agents. Underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters, and any discounts or commissions
received by them from the Company and any profit on the resale of Securities by
them may be deemed to be underwriting discounts and commissions under the
Securities Act. Any such underwriter or agent will be identified, and any such
compensation received from the Company will be described, in the applicable
Prospectus Supplement.
27
<PAGE>
Under agreements which may be entered into by the Company, underwriters
and agents who participate in the distribution of Securities may be entitled to
indemnification by the Company against certain liabilities, including
liabilities under Canadian and United States securities legislation.
The Company may grant underwriters who participate in the distribution of
Securities an option to purchase additional Securities to cover over-allotments,
if any.
The place and date of delivery for the Securities in respect of which this
Prospectus is being delivered will be set forth in the applicable Prospectus
Supplement.
Unless otherwise indicated in the applicable Prospectus Supplement, the
Securities in respect of which this Prospectus is being delivered (other than
Common Shares) will be a new issue of securities, will not have an established
trading market when issued and will not be listed on any securities exchange.
Any underwriters or agents to or through whom such Securities are sold by the
Company for public offering and sale may make a market in such Securities, but
such underwriters or agents will not be obligated to do so and may discontinue
any market making at any time without notice. No assurance can be given as to
the liquidity of the trading market for any such Securities.
Certain of the underwriters and their affiliates may from time to time
perform various commercial banking and investment banking services for the
Company, for which customary compensation is received.
EXPERTS
The consolidated balance sheets of Golden Star Resources Ltd. as of
December 31, 1996 and 1995 and the consolidated statement of operations,
shareholders' equity and cash flows for the years ended December 31, 1996, 1995
and 1994, included in the Company's Annual Report on Form 10-K for the year
ended December 31, 1996, incorporated by reference herein have been included in
this Form S-3 in reliance on the report of Coopers & Lybrand, chartered
accountants, given on the authority of that firm as experts in accounting and
auditing.
LEGAL MATTERS
Certain legal matters relating to the validity of the Securities will be
passed upon for the Company by Paul, Weiss, Rifkind, Wharton & Garrison, New
York, New York, and by Koffman Birnie & Kalef, Vancouver, British Columbia.
Certain legal matters will be passed upon for the underwriters, if any, by the
counsel named in the applicable Prospectus Supplement.
28
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14 - OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following sets forth expenses, other than underwriting fees and
commissions, expected to be borne by the Registrant in connection with the
distribution of the securities being registered:
Securities and Exchange Commission registration fee U.S. $14,457*
Blue Sky fees and expenses........................ **
Stock exchange listing fees ...................... **
NASD filing fee .................................. **
Rating Agency fees ............................... **
Transfer Agent fees .............................. **
Legal ............................................ **
Printing ......................................... **
Accounting ....................................... **
Miscellaneous .................................... **
=============
TOTAL ................................ U.S. $ **
- ------------------
* Pursuant to Rule 429(b) under the Securities Act, this Registration
Statement also shall include securities registered pursuant to
Registration Statement No. 333-22673 for which the registration fee of
$28,039 was paid.
** To be completed by amendment.
All amounts listed above, except for the registration fee and the NASD
filing fee, are estimates.
ITEM 15 - INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 124 of the Canada Business Corporations Act ("CBCA") provides for
the indemnification of directors and officers of the Company. Under these
provisions, the Company may indemnify a director or officer, or former director
or officer or a person who acts or acted at the Company's request as a director
or officer of a body corporate of which the Company is or was a shareholder or
creditor and the heirs and legal representatives of such a person against all
costs, charges and expenses, including amounts paid to settle an action or
satisfy a judgment, reasonably incurred by such director or officer in respect
to any civil, criminal or administrative action or proceeding (other than in
respect of an action by or on behalf of the Company to procure a judgment in its
favor) to which such director or officer, former director or officer or person
who acts or acted at the Company's request as a director or officer is made a
party by reason of his position with the Company, if he fulfills the following
two conditions: (a) he acted honestly and in good faith with a view to the best
interests of the Company and (b) in the case of a criminal or administrative
action or proceeding that is enforced by a monetary penalty, he had reasonable
grounds for believing that his conduct was lawful. In respect of an action by or
on behalf of the Company to procure a judgment in its favor, the Company, with
the approval of a court, may indemnify a director or officer, as a director or
officer, former director or officer or person who acts or acted at the Company's
request as a director or officer against all costs, charges and expenses
reasonably incurred by him in connection with such action if he fulfills the
II-1
<PAGE>
conditions set out in clauses (a) and (b) of the previous sentence.
Notwithstanding the foregoing, a director or officer, former director or officer
or person who acts or acted at the Company's request as a director or officer is
entitled to indemnification from the Company in respect of all costs, charges
and expenses reasonably incurred by him in connection with the defense of any
civil, criminal or administrative action or proceeding to which he is made a
party by reason of his position with the Company if he was substantially
successful on the merits in his defense of the action or proceeding and he
fulfills the conditions in clause (a) and (b) of the second sentence of this
paragraph.
Subject to the provisions of the CBCA, the By-laws of the Company provide
that the Company shall indemnify a director or officer, a former director or
officer, or a person who acts or acted at the Company's request as a director or
officer of a corporation in which the Company is or was a shareholder or
creditor against all losses and expenses, including an amount paid to settle an
action or satisfy a judgment, reasonably incurred by him in respect of any
civil, criminal or administrative proceeding to which he was made a party by
reason of being or having been a director or officer of the Company or other
corporation if he acted honestly and in good faith with a view to the best
interests of the Company or, in the case of a criminal or administrative action
or proceeding that is enforced by monetary penalty, he had reasonable grounds in
believing that his conduct was lawful. In addition, the By-laws provide that the
Company also shall indemnify any such person in such other circumstance as the
CBCA or law permits or requires. The Company has entered into agreements with
its directors and officers indemnifying such directors and officers to the
extent permitted by the CBCA and the Company's By-laws.
Reference is made to the form of Underwriting Agreement filed as an
exhibit to this Registration Statement pursuant to which the underwriters will
agree to indemnify the Company and its directors and officers against certain
liabilities, including liabilities under the Securities Act.
A directors' and officers' liability insurance policy is maintained by the
Company which insures directors and officers for losses as a result of claims
based upon the acts or omissions as directors and officers of the Company,
including liabilities arising under the Securities Act of 1933, and also
reimburses the Company for payments made pursuant to the indemnity provisions
under the CBCA.
ITEM 16 - EXHIBITS
Exhibit
Number Description
------- -----------
1.1* Form of Underwriting Agreement
3.1 Articles of the Company (incorporated by reference to
Exhibit 1.1 to the Company's Registration Statement on
Form 20-F, filed on May 10, 1993), Articles of the
Company (incorporated by reference to Exhibit 2.1 to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1994) and Certificate of Amendment to the
Articles of the Company, dated July 29, 1996
(incorporated by reference to Exhibit (a)(3)(i) to the
Company's Quarterly Report on Form 10-Q, filed on August
14, 1996) 3.2* Amendment to the Articles of the Company
with respect to the Preferred Shares.
II-2
<PAGE>
Exhibit
Number Description
------- -----------
3.3 By-laws of the Company (incorporated by reference to
Exhibit 1.2 to the Company's Registration Statement on
Form 20-F, filed on May 10, 1993 and to Exhibit 3 to the
Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995)
4.1** Form of Indenture for the Convertible Debt Securities
4.2* Form of Convertible Debt Security (included in Exhibit
4.1)
4.3* Form of Common Shares Warrant Agreement
4.4* Form of Common Shares Warrant Certificate (included in
Exhibit 4.3)
4.5* Form of Preferred Shares Warrant Agreement
4.6* Form of Preferred Shares Warrant Certificate (included
in Exhibit 4.5)
4.7* Form of Convertible Debt Securities Warrant Agreement
4.8* Form of Convertible Debt Securities Warrant Certificate
(included in Exhibit 4.7)
4.9** Form of Common Share Certificate
4.10* Description of Preferred Shares (included in Exhibit
3.2)
4.11* Form of Preferred Share Certificate
5.1** Opinion of Paul, Weiss, Rifkind, Wharton & Garrison
5.2** Opinion of Koffman Birnie & Kalef
12.1** Statements re Computation of Ratios
23.1 Consent of Coopers & Lybrand
23.2** Consent of Paul, Weiss, Rifkind, Wharton & Garrison
(included in Exhibit 5.1)
23.3** Consent of Koffman Birnie & Kalef (included in Exhibit
5.2)
24.1 Powers of Attorney (included on signature pages)
25.1* Statement of Eligibility of Trustee on Form T-1
--------------
* Subsequent to the effective date of this Registration Statement,
to be filed on a Current Report on Form 8-K and incorporated
herein by reference.
** To be filed by amendment.
II-3
<PAGE>
ITEM 17 - UNDERTAKINGS
The Registrant hereby undertakes that, for the purposes of determining any
liability under the Securities Act of 1933, each filing of the Registrant's
annual report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in this Registration Statement shall be
deemed to be a new Registration Statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of the
prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price represent
no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table
in the effective registration statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement.
provided, however, that paragraphs (a)(i) and (a)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
and Exchange Act of 1934, that are incorporated by reference in the
Registration Statement.
(b) That for purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus
filed as part of a Registration Statement in reliance upon Rule 430A
and contained in the form of prospectus filed by the Registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
of 1933 shall be deemed to be part of this Registration Statement as
of the time it was declared effective.
(c) That for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new Registration Statement
relating to the securities offered therein, and
II-4
<PAGE>
the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(d) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses is incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes to file an application for
the purpose of determining the eligibility of the Trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with the
rules and regulations prescribed by the Commission under Section 305(b)(2) of
the Trust Indenture Act.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in Denver, Colorado on August 8, 1997.
GOLDEN STAR RESOURCES LTD.
By: /s/ David A. Fennell
-------------------------------------
David A. Fennell
President and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below hereby constitutes and appoints David A. Fennell and Gordon J.
Bell, and each of them, his or her true and lawful agent, proxy and
attorney-in-fact, each acting alone, with full power of substitution and
resubstitution, for him or her and in his or her name, place and stead, in any
and all capacities, to (i) act on, sign and file with the Securities and
Exchange Commission any and all amendments (including post-effective amendments)
to this registration statement together with all schedules and exhibits thereto
and any subsequent registration statement filed pursuant to Rule 462(b) under
the Securities Act of 1933, as amended, together with all schedules and exhibits
thereto, (ii) act on, sign and file such certificates, instruments, agreements
and other documents as may be necessary or appropriate in connection therewith,
(iii) act on and file any supplement to any prospectus included in this
registration statement or any such amendment or any subsequent registration
statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as
amended, and (iv) take any and all actions which may be necessary or appropriate
in connection therewith, granting unto such agents, proxies and
attorneys-in-fact, and each of them, full power and authority to do and perform
each and every act and thing necessary or appropriate to be done, as fully for
all intents and purposes as he or she might or could do in person, hereby
approving, ratifying and confirming all that such agents, proxies and
attorneys-in-fact, any of them or any of his or her or their substitutes may
lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
II-6
<PAGE>
<TABLE>
<CAPTION>
NAME TITLE DATE
---- ----- ----
<S> <C> <C>
/s/ David K. Fagin Chairman of the Board of August 7, 1997
- -------------------------------- Directors
David K. Fagin
/s/ David A. Fennell President, Chief Executive August 7, 1997
- -------------------------------- Officer and Director (Principal
David A. Fennell Executive Officer)
August 7, 1997
/s/ Pierre Gousseland Director
- --------------------------------
Pierre Gousseland
/s/ Donald F. Mazankowski Director August 7, 1997
- --------------------------------
Donald F. Mazankowski
/s/ Ernest C. Mercier Director August 7, 1997
- --------------------------------
Ernest C. Mercier
/s/ Robert Minto Director August 7, 1997
- --------------------------------
Robert Minto
/s/ Roger D. Morton Director August 7, 1997
- --------------------------------
Roger D. Morton
/s/ Richard A. Stark Director August 7, 1997
- --------------------------------
Richard A. Stark
/s/ Gordon J. Bell Vice President and Chief August 7, 1997
- -------------------------------- Financial Officer (Principal
Gordon J. Bell Financial and Accounting
Officer)
</TABLE>
II-7
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
------- -----------
1.1* Form of Underwriting Agreement
3.1 Articles of the Company (incorporated by reference to
Exhibit 1.1 to the Company's Registration Statement on
Form 20-F, filed on May 10, 1993), Articles of the
Company (incorporated by reference to Exhibit 2.1 to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1994) and Certificate of Amendment to the
Articles of the Company, dated July 29, 1996
(incorporated by reference to Exhibit (a)(3)(i) to the
Company's Quarterly Report on Form 10-Q, filed on August
14, 1996)
3.2* Amendment to the Articles of the Company with respect to
the Preferred Shares
3.3 By-laws of the Company (incorporated by reference to
Exhibit 1.2 to the Company's Registration Statement on
Form 20-F, filed on May 10, 1993 and to Exhibit 3 to the
Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995)
4.1** Form of Indenture for the Convertible Debt Securities
4.2* Form of Convertible Debt Security (included in Exhibit
4.1)
4.3* Form of Common Shares Warrant Agreement
4.4* Form of Common Shares Warrant Certificate (included in
Exhibit 4.3)
4.5* Form of Preferred Shares Warrant Agreement
4.6* Form of Preferred Shares Warrant Certificate (included in
Exhibit 4.5)
4.7* Form of Convertible Debt Securities Warrant Agreement
4.8* Form of Convertible Debt Securities Warrant Certificate
(included in Exhibit 4.7)
4.9** Form of Common Share Certificate
4.10* Description of Preferred Shares (included in Exhibit 3.2)
4.11* Form of Preferred Share Certificate
5.1** Opinion of Paul, Weiss, Rifkind, Wharton & Garrison
5.2** Opinion of Koffman Birnie & Kalef
12.1** Statements re Computation of Ratios.
<PAGE>
Exhibit
Number Description
------- -----------
23.1 Consent of Coopers & Lybrand
23.2** Consent of Paul, Weiss, Rifkind, Wharton & Garrison
(included in Exhibit 5.1)
23.3** Consent of Koffman Birnie & Kalef (included in Exhibit
5.2)
24.1 Powers of Attorney (included on signature pages)
25.1* Statement of Eligibility of Trustee on Form T-1
--------------
* Subsequent to the effective date of this Registration Statement, to
be filed on a Current Report on Form 8-K and incorporated herein by
reference.
** To be filed by amendment.
Exhibit 23.1
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated March 14, 1997, on our audits of the
consolidated financial statements of Golden Star Resources Ltd. as of December
31, 1996 and 1995 and for the years ended December 31, 1996, 1995 and 1994
included in the Company's Annual Report on Form 10-K. We also consent to the
reference to our Firm under the caption "Experts."
/s/ Coopers & Lybrand
Chartered Accountants
Calgary, Canada
August 8, 1997
