FORM 6-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule
13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of: April 2006
Commission File Number: 0-25672
| MIRAMAR MINING CORPORATION |
| (Translation of registrant’s name into English) |
#300 - 889 Harbourside Drive
North Vancouver, British Columbia
Canada V7P 3S1 |
| (Address of principal executive offices) |
Indicate by check mark whether the registrant files
or will file annual reports under cover Form 20-F or Form 40-F
Indicate by check mark if the registrant is submitting
the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting
the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Indicate by check mark whether by furnishing the information
contained in this Form, the registrant is also thereby furnishing the information to the Commission
pursuant to rule 12g3-2(b) under the Securities Exchange Act of 1934.
If “Yes” is marked, indicate below the file number
assigned to the registrant in connection with Rule 12g3-2(b) 82 —
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
| |
MIRAMAR MINING CORPORATION
(Registrant) |
| |
By: /s/ A. David Long
A. David Long, Corporate Secretary |
Dated: April 13, 2006
EXHIBIT INDEX
EXHIBIT 1
 |
MIRAMAR MINING CORPORATION
Suite 300 – 889 Harbourside
Drive, North Vancouver, B.C. V7P 3S1 Canada
Tel: (604) 985-2572 Fax: (604) 980-0731 Toll Free: 1-800-663-8780
|
NOTICE OF ANNUAL AND
SPECIAL GENERAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that
the Annual and Special General Meeting (the “Meeting”) of the shareholders of
Miramar Mining Corporation (the “Corporation”) will be held in the Shuswap Room
of the Four Seasons Hotel, 791 West Georgia Street, Vancouver, British Columbia on May 3,
2006, at the hour of 10:00 a.m. (Vancouver Time) for the following purposes:
| 1. |
|
to
receive the audited financial statements of the Corporation for the financial
year of the Corporation ended December 31, 2005, together with the report
of the auditor thereon; |
| 2. |
|
to
fix the number of directors of the Corporation at eight; |
| 3. |
|
to
elect directors of the Corporation; |
| 4. |
|
to
appoint an auditor of the Corporation for the ensuing financial year and to
authorize the directors of the Corporation to fix the remuneration of the
auditor; |
| 5. |
|
to
consider and, if thought fit, to approve special resolutions to: |
| |
a. |
|
remove
the application of the Pre-existing Company Provisions, as defined in the Business
Corporations Act (British Columbia); and |
| |
b. |
|
approve
new Articles for the Corporation; |
| |
as
more particularly described in the accompanying Information Circular; and |
| 6. |
|
to
transact such other business as may properly come before the Meeting or any
adjournment thereof. |
Shareholders of the Corporation are
invited to attend the Meeting. Shareholders of record at the close of business on March
29, 2006 are entitled to notice of the Meeting and will be entitled to vote at the
Meeting. Shareholders who are unable to attend the Meeting in person should complete, date
and sign the accompanying form of proxy and return it to the office of the
Corporation’s registrar and transfer agent, Pacific Corporate Trust Company, at
2nd Floor, 510 Burrard Street, Vancouver, BC V6C 3B9.
Dated at Vancouver, British
Columbia, this 7th day of April, 2006.
| |
By Order of the Board
Anthony P. Walsh
President |
NOTE: Shareholders are
requested to date, sign and return the accompanying form of proxy for use at the Meeting
whether or not they are able to attend personally. To be effective, and in order to be
used at the Meeting or an adjournment thereof, forms of proxy must be received by the
Corporation c/o Pacific Corporate Trust Company, 2nd Floor, 510 Burrard Street, Vancouver,
British Columbia V6C 3B9, prior to 5:00 p.m., Vancouver time, on May 1, 2006, or, in the
case of an adjournment of the Meeting, not later than 5:00 p.m., Vancouver time, on the
business day prior to the reconvened meeting.
DEPOSIT OF A PROXY MAY BE MADE BY
DELIVERY THROUGH THE MAIL, BUT THE PROXY SHOULD BE MAILED PROMPTLY IN ORDER TO ENSURE
TIMELY DEPOSIT. A SELF-ADDRESSED ENVELOPE IS PROVIDED FOR RETURN OF A PROXY.
EXHIBIT 2
MANAGEMENT INFORMATION
CIRCULAR
This information circular (this
“Proxy Circular”) is being furnished to the shareholders of Miramar Mining
Corporation (the “Corporation”) in connection with the solicitation of proxies
by the management of the Corporation for use at the annual general meeting of the
shareholders of the Corporation (the “Meeting”) to be held in the Shuswap Room
at the Four Seasons Hotel, 791 West Georgia Street in Vancouver, British Columbia on May
3, 2006 at the hour of 10:00am Pacific Time, for the purposes set out in the notice of the
Meeting accompanying this Proxy Circular. This Proxy Circular is first being sent to
shareholders of the Corporation on or about April 7, 2005. Unless otherwise stated,
information contained in this Proxy Circular is given as at March 29, 2005 (except where
indicated).
The solicitation of proxies for the
Meeting will be primarily by mail but proxies may also be solicited personally or by
telephone by employees of the Corporation or by agents retained by the Corporation.
Employees of the Corporation will not receive any extra compensation for such activities.
The Corporation may also pay brokers or other persons holding common shares of the
Corporation in their own names, or in the names of nominees, their reasonable expenses for
sending proxies and proxy material to beneficial owners of common shares of the
Corporation and requesting authority to execute proxies in respect of such common shares
of the Corporation. The Corporation will bear the expenses of such solicitation of
proxies.
No person is authorized to give any
information or to make any representation other than as contained in this Proxy Circular
and, if given or made, such information or representation should not be relied upon as
having been authorized by the Corporation. The delivery of this Proxy Circular shall not
under any circumstances create an implication that there has been no change in the
information set forth herein since the date of this Proxy Circular.
APPOINTMENT OF PROXY
AND DISCRETIONARY AUTHORITY
The persons named in the form of
proxy accompanying this Proxy Circular are officers and directors of the Corporation. A
shareholder of the Corporation has the right to appoint a person or company, who need not
be a shareholder of the Corporation, other than the person or company designated in the
form of proxy accompanying this Proxy Circular, as nominee to attend and act for and on
behalf of such shareholder at the Meeting and may exercise such right by inserting the
name of such person in the blank space provided on the form of proxy, or by executing a
proxy in a form similar to the form of proxy accompanying this Proxy Circular. If a
shareholder of the Corporation appoints one of the persons named in the form of proxy
accompanying this Proxy Circular as the nominee of the shareholder and does not direct
such nominee to vote either for, against or withhold from voting in respect of a matter or
matters with respect to which an opportunity to specify how the common shares of the
Corporation registered in the name of such shareholder are to be voted, the proxy will be
voted for such matter or matters.
To be effective, proxies must be
received by the Corporation c/o Pacific Corporate Trust Company (the "Transfer Agent"),
510 Burrard Street, 2nd Floor, Vancouver, B.C. V6C 3B9 prior to 5:00 p.m., Pacific
-2-
Time, on May 1, 2006 or, in
the case of any adjournment of the Meeting, not later than 5:00 p.m., Pacific Time, on the
business day prior to the reconvened meeting. Deposit of a proxy may be made by delivery
through the mail, but the proxy should be mailed promptly in order to ensure timely
deposit. A self addressed envelope is provided for the return of a proxy.
EXERCISE OF VOTE BY
PROXY
The common shares of the Corporation
represented by a proxy at the Meeting will be voted for, against or withheld from voting
in accordance with the instructions of the holder of such common shares of the
Corporation, so long as such instructions are certain, on any ballot that may be called
for and, where the shareholder of the Corporation whose proxy is solicited specifies a
choice with respect to any matter to be voted upon, the common shares of the Corporation
represented by such proxy will be voted in accordance with the specification so made.
If no choice is specified in the
proxy, the persons named in the form of proxy accompanying this Proxy Circular will vote
for all of the matters proposed by management at the Meeting and described in the notice
of the Meeting accompanying this Proxy Circular.
The form of proxy accompanying
this Proxy Circular confers discretionary authority upon the persons named therein with
respect to any amendment or variation to the matters identified in the notice of the
Meeting accompanying this Proxy Circular and with respect to other matters which may
properly come before the Meeting. Management of the Corporation knows of no matters to
come before the Meeting other than those referred to in the notice of the Meeting
accompanying this Proxy Circular. However, if any other matters which are not now known to
management of the Corporation should properly come before the Meeting, the common shares
of the Corporation represented by proxies given in favour of the persons named in the form
of proxy accompanying this Proxy Circular will be voted on such matters in accordance with
the best judgment of such person.
NON-REGISTERED HOLDERS
Only registered shareholders or duly
appointed proxyholders are permitted to vote at the Meeting. Most shareholders of the
Corporation are “non-registered” shareholders because the Common Shares of the
Corporation they own are not registered in their names but are instead registered in the
name of the brokerage firm, bank or trust company through which they purchased the shares.
More particularly, a person is not a registered shareholder in respect of shares which are
held on behalf of that person (the “Non-Registered Holder”) but which are
registered either: (a) in the name of an intermediary (an “Intermediary”) that
the Non-Registered Holder deals with in respect of the shares (Intermediaries include
among others, banks, trust companies, securities dealers or brokers and trustees or
administrators of self-administered RRSPs, RRIFs, RESPs and similar plans); or (b) in the
name of a clearing agency (such as The Canadian Depository for Securities Limited
(“CDS”)) of which the Intermediary is a participant.
The notice of meeting, this
information circular and the proxy (collectively, the “Meeting Materials”) are
being sent to both registered and Non-Registered Holders of the Common Shares of the
Corporation. Non-Registered Holders who have not objected to their Intermediary disclosing
certain ownership information about themselves to the Corporation are referred to as
“NOBO’s”. Those Non-Registered Holders who have objected to their
Intermediary disclosing ownership information about themselves to the Corporation are
referred to as “OBO’s”. In accordance with the requirements of National
Instrument 54-101 of the Canadian Securities Administrators, the Corporation has elected
to send the Meeting Materials directly to the NOBO’s, and indirectly through
Intermediaries to the OBO’s. If you are a Non-Registered Holder, and the Corporation
or its agent has sent the Meeting Materials directly to you, your name and address and
information about your holdings of Common Shares of the Corporation have been obtained in
accordance with applicable security regulatory requirements from the Intermediary holding
on your behalf. By choosing to send these materials to you directly, the Corporation (and
not the Intermediary holding on your behalf) has assumed responsibility for (i) delivering
these materials to you, and (ii) executing your proper voting instructions. Please return
your voting instructions as specified in the request for voting instructions.
-3-
In this regard, Meeting Materials
sent to NOBO’s who have not waived the right to receive Meeting Materials are
accompanied by a Voting Instruction Form (a “VIF”) from the Transfer Agent. This
form is instead of a proxy. By returning the VIF in accordance with the instructions noted
on it, a NOBO is able to instruct how the Common Shares are to be voted on its behalf.
VIFs should be completed and returned in accordance with the specific instructions noted
on the VIF.
The Intermediaries (or their service
companies) are responsible for forwarding the Meeting Materials to each OBO, unless the
OBO has waived the right to receive them. Such Intermediaries have their own mailing
procedures and provide their own return instructions to clients which should be carefully
followed by OBO’s in order to ensure that their Common Shares are voted at the
Meeting.
In either case, the purpose of this
procedure is to permit Non-Registered Holders to direct the voting of the Common Shares of
the Corporation which they beneficially own. Should a Non-Registered Holder wish to attend
the Meeting or have someone else attend on his/her behalf, the Non-Registered Holder may
request a legal proxy, which will grant the Non-Registered Holder or his/her nominee the
right to attend and vote at the meeting.
REVOCATION OF PROXIES
A shareholder of the Corporation may
revoke a previously given proxy by depositing an instrument in writing executed by the
shareholder or his attorney authorized in writing, or, if the shareholder is a
corporation, under its corporate seal by an officer or attorney thereof properly
authorized, indicating the capacity in which such officer or attorney is signing, and
deposited, together with the instrument so empowering the officer or officers or the
attorney, or a notarially certified copy of such instrument, either at the registered
office of the Corporation at any time up to and including 5:00 p.m., Pacific Time, on May
1, 2006 or any adjournment thereof, at which the proxy is to be used, or to the chairman
of the Meeting on the day of the Meeting or any adjournment thereof before any vote in
respect of which the proxy is to be used shall have been taken or in any other manner
provided by law.
VOTING SECURITIES AND
PRINCIPAL HOLDERS THEREOF
The Corporation is authorized to
issue 500,000,000 common shares of which, as at March 29, 2006, 187,404,627 common shares
were outstanding, each entitled to one vote on each matter voted upon by ballot at the
Meeting. Each holder of record of common shares of the Corporation on March 29, 2005 was
entitled to notice of the Meeting and is entitled to vote at the Meeting.
To the best of the knowledge of the
directors and the executive officers of the Corporation, at March 29, 2005 no person or
company beneficially owned, directly or indirectly, or exercised control or direction
over, voting securities carrying more than 10% of the voting rights attached to any class
of voting shares of the Corporation other than Dundee Precious Metals Inc. which,
exercised control or direction over, an aggregate of 18,917,545 common shares of the
Corporation, which represents approximately 10.18% of the issued shares of the
Corporation.
ELECTION OF DIRECTORS
The Board of Directors of the
Corporation presently consists of eight directors, therefore it is intended to determine
the number of directors at eight and to elect eight directors for the ensuing year.
It is proposed that the persons named
below be nominated for election as directors of the Corporation. All of the proposed
nominees are now directors of the Corporation and have been since the year set forth
below. Management of the Corporation does not contemplate that any of the proposed
nominees will be unable to serve as directors of the Corporation but, if that should occur
for any reason prior to the Meeting, the persons named in the form of proxy accompanying
this Proxy Circular have the right to vote for any other nominee of management of the
Corporation. Each director will be elected to hold office until the close of the next
annual general meeting of the shareholders of the Corporation or until his/her successor
-4-
is appointed or elected. The
following table sets forth certain information concerning the persons nominated for
election as directors of the Corporation.
|
Name, Province or State,
and Country of Residence
|
Positions Held |
Principal Occupation |
Director Since |
Number of
Common Shares
(6) |
|
| Lawrence Bell(1)(5) |
|
Director |
|
Chairman of the Board, BC |
|
May 22, 2003 |
|
20,000 |
|
| British Columbia, Canada | |
| |
Hydro, electrical utility | |
| |
| David Fennell(2)(4) | |
Executive | |
Business Executive | |
June 28, 2002 | |
2,293,742 | |
| Nassau, Bahamas | |
Vice-Chairman, and | |
| |
Director | |
| |
| Catherine McLeod- | |
Director | |
Board Chair, Pacific Rim | |
March 21, 2001 | |
15,667 | |
| Seltzer(3)(5) | |
| |
Mining Corporation, natural | |
| British Columbia, Canada | |
| |
resource company | |
| |
| Peter Nixon(1)(5) | |
Director | |
Corporate Director | |
June 28, 2002 | |
13,150 | |
| Ontario, Canada | |
| |
| Anthony J. Petrina(2)(3)(4)(5) | |
Chairman of the Board | |
Mining Engineer, Corporate | |
January 5, 1995 | |
45,000 | |
| British Columbia, Canada | |
and Director | |
Director | |
| |
| Christopher J. Pollard(1)(4) | |
Director | |
Corporate Director | |
January 18, 1994 | |
| British Columbia, Canada | |
| |
| William E. Stanley(1)(2)(3) | |
Director | |
Mining Engineer, Industry | |
January 5, 1995 | |
9,000 | |
| British Columbia, Canada | |
Consultant | |
| |
| Anthony P. Walsh(2) | |
President and Chief | |
President and Chief Executive | |
March 5, 1999 | |
187,192 | |
| British Columbia, Canada | |
Executive Officer and | |
Officer of the Corporation | |
| |
Director | |
|
| |
(1) |
|
Member
of the Audit & Risk Management Committee |
| |
(2) |
|
Member
of the Executive Committee |
| |
(3) |
|
Member
of the Human Resources Committee |
| |
(4) |
|
Member
of the Safety and Environmental Committee |
| |
(5) |
|
Member
of the Corporate Governance and Nominating Committee |
| |
(6) |
|
Indicates
the number of common shares of the Corporation beneficially owned, directly or
indirectly, or over which control or direction is exercised. Such
information, not being within the knowledge of the Corporation, has been furnished by
the respective nominees. |
Unless such authority is withheld,
the persons named in the form of proxy accompanying this Proxy Circular intend to vote for
the election of the foregoing individuals as directors of the Corporation.
EXECUTIVE COMPENSATION
The following table sets forth all
annual and long-term compensation for services rendered in all capacities to the
Corporation and to subsidiaries of the Corporation for the financial years ended December
31, 2005, 2004 and 2003 to the extent required by law in respect of each of the
individuals who were at any time during 2005, the Chief Executive Officer, the Chief
Financial Officer and the three other most highly compensated executive officers of the
Corporation (collectively the “Named Executive Officers”) whose salary and bonus
for such year exceed $150,000.
-5-
SUMMARY COMPENSATION
TABLE
|
|
|
Annual Compensation |
Long-Term
Compensation
Awards |
|
|
Name and
Principal Position |
Year |
Salary
($) |
Bonus
($) |
Other Annual
Compensation(1)
($) |
Securities Under
Options Granted
(#) |
All Other
Compensation
($) |
|
| Anthony P. Walsh |
|
2005 |
|
320,000 |
|
95,000 |
|
27,500 |
|
240,000 |
|
— |
|
| President & Chief | |
2004 | |
320,000 | |
— | |
29,155 | |
230,000 | |
— | |
| Executive Officer | |
2003 | |
290,000 | |
100,000 | |
25,500 | |
150,000 | |
— | |
|
| Brian M. Labadie | |
2005 | |
215,000 | |
50,000 | |
25,700 | |
180,000 | |
— | |
| Executive Vice-President | |
2004 | |
215,000 | |
— | |
25,315 | |
145,000 | |
— | |
| & Chief Operating Officer | |
2003 | |
215,000 | |
45,000 | |
23,700 | |
100,000 | |
— | |
|
| A. David Long | |
2005 | |
150,000 | |
45,000 | |
23,900 | |
180,000 | |
— | |
| Corporate Secretary | |
2004 | |
150,000 | |
— | |
23,515 | |
140,000 | |
— | |
| Vice-President, Legal | |
2003 | |
141,968 | |
30,000 | |
21,900 | |
90,000 | |
— | |
|
| John Wakeford | |
2005 | |
141,333 | |
45,000 | |
22,400 | |
180,000 | |
— | |
| Vice-President, | |
2004 | |
123,750 | |
30,000 | |
15,250 | |
— | |
— | |
| Exploration | |
|
| Elaine Bennett | |
2005 | |
135,000 | |
25,000 | |
23,900 | |
180,000 | |
— | |
| Vice-President & | |
2004 | |
135,000 | |
— | |
23,515 | |
140,000 | |
— | |
| Controller | |
2003 | |
115,000 | |
23,000 | |
21,900 | |
90,000 | |
— | |
|
| |
(1) |
|
In
each case the amount represents a Registered Retirement Savings Plan contribution of
approximately $15,500 per annum; a car allowance of between $700 and $1,000
per month and a parking allowance of $50 per month. Mr. Walsh receives a club
membership of approximately $170 per month. |
| |
(2) |
|
Mr.
Wakeford was appointed a Vice-President, Exploration on May 19, 2004. |
The services of David Fennell as
Executive Vice Chairman of the Corporation are provided by Laurentian Mountain
Investments Ltd. under a two year contract for the period January 2005 to
December 2007 for a fee of US$350,000 and stock options in an amount equivalent to
options granted annually to senior officers of the Corporation. In 2006, Laurentian
Mountain Investments received 50,000 bonus options at a strike price of $2.75
exercisable for a period of five years for work done in 2005.
Stock Option Plan
Under the stock option plan of the
Corporation (the “Stock Option Plan”), options to purchase common shares of the
Corporation may be granted to full or part-time employees and directors of the
Corporation or subsidiaries of the Corporation and other persons or companies
engaged to provide ongoing management or consulting services for the Corporation
or any entity controlled by the Corporation. The
-6-
maximum number of common shares of
the Corporation subject to option under the Stock Option Plan may not exceed
10,800,000. In determining the number of common shares of the Corporation subject to
each option granted under the Stock Option Plan, consideration is given to the present
and potential contribution by such person or company to the success of the
Corporation. The exercise price per common share may not be less than the closing
price of the common shares of the Corporation on the Toronto Stock Exchange on the
trading day immediately preceding the day on which the option is granted. Each option
is for a term not in excess of 10 years and is not exercisable unless the optionee has
been continuously employed by, a director or an officer of, or engaged in providing
ongoing management or consulting services for, the Corporation or a subsidiary of the
Corporation continuously since the date of grant of the option, except (i) in the case
of the death of an optionee, in which case the option is exercisable for a maximum
of 12 months thereafter, (ii) in the case of an optionee ceasing to be a participant
under the Stock Option Plan for any reason other than cause of death, in which case the
option is exercisable for a maximum of 30 days thereafter or (iii) an optionee who is a
director ceasing to be a participant under the Stock Option Plan as a result of a
takeover of the Corporation, in which case the option is exercisable for a maximum
period of one year. The Stock Option Plan does not provide for the granting of financial
assistance, whether by way of a loan, guarantee or otherwise, by the Corporation
in connection with any purchase of common shares from the Corporation. All options
granted by the Corporation are currently exercisable for a five year term.
During the financial year of the
Corporation ended December 31, 2005 options were granted to the Named Executive Officers
as follows:
OPTIONS GRANTED TO NAMED EXECUTIVE
OFFICERS DURING 2005
|
Name |
Securities
Under
Options
Granted
(#) |
% of Total
Options
Granted to
Employees in
Financial Year |
Exercise
Price
($/Security) |
Market Value of
Securities
Underlying
Options on the
Date of Grant
($/Security) |
Expiration Date |
|
| Anthony P. Walsh |
|
180,000 |
|
7.9 |
% |
$1.25 |
|
$1.25 |
|
Feb 7, 2010 |
|
| |
60,000 |
|
|
|
$1.50 |
|
$1.50 |
|
May 3, 2010 | |
|
| Brian Labadie | |
120,000 |
|
5.9 |
% |
$1.25 |
|
$1.25 |
|
Feb 7, 2010 | |
| |
60,000 |
|
|
|
$1.50 |
|
$1.50 |
|
May 3, 2010 | |
|
| A. David Long | |
120,000 |
|
5.9 |
% |
$1.25 |
|
$1.25 |
|
Feb 7, 2010 | |
| |
60,000 |
|
|
|
$1.50 |
|
$1.50 |
|
May 3, 2010 | |
|
| John Wakeford | |
120,000 |
|
5.9 |
% |
$1.25 |
|
$1.25 |
|
Feb 7, 2010 | |
| |
60,000 |
|
|
|
$1.50 |
|
$1.50 |
|
May 3, 2010 | |
|
| Elaine Bennett | |
120,000 |
|
5.9 |
% |
$1.25 |
|
$1.25 |
|
Feb 7, 2010 | |
| |
60,000 |
|
|
|
$1.50 |
|
$1.50 |
|
May 3, 2010 | |
|
The following table sets forth
details of all exercises of options during the financial year of the Corporation ended
December 31, 2005 by each of the Named Executive Officers and the value as at December 31,
2005 of unexercised options on an aggregate basis:
-7-
AGGREGATED OPTION
EXERCISES DURING THE
MOST RECENTLY COMPLETED FINANCIAL YEAR AND
DECEMBER 31, 2005 OPTION VALUES
|
|
Name |
Securities
Acquired on
Exercise
(#) |
Aggregate Value
Realized
($) |
Unexercised
Options at
December 31, 2005
(#)
Exercisable/
Unexercisable(6) |
Unexercised in-the-
Money Options at
December 1, 2005
($)
Exercisable/
Unexercisable(6)
|
|
| Anthony Walsh |
|
70,000 |
|
$ 70,000 |
|
689,000 |
|
$1,486,280 |
|
|
| Brian Labadie | |
— | |
— | |
425,000 | |
$ 890,600 | |
|
| A. David Long | |
— | |
— | |
520,000 | |
$1,168,000 | |
|
| John Wakeford | |
16,000 | |
$ 20,000 | |
320,000 | |
$ 566,480 | |
|
| Elaine Bennett | |
— | |
— | |
410,000 | |
$ 846,800 | |
|
| |
(1) |
|
69,000
at $1.22; 180,000 @ $1.25; 60,000 $1.50; 150,000 at $1.90; 180,000 at $3.34 and 50,000 at
$2.76. |
| |
(2) |
|
120,000
@ $1.25, 60,000 @ $1.50; 100,000 at $1.90;120,000 at $3.34 and 25,000 at $2.76 |
| |
(3) |
|
20,000
at $1.00, 80,000 at $1.22; 120,000 @ $1.25; 60,000 @ $1.50; 90,000 at $1.90; 120,000 at $
3.34 and 20,000 at $2.76. |
| |
(4) |
|
104,000
@ $1.25; 60,000 @ $1.50; 30,000 @ $2.36; 30,000 @ $3.34 |
| |
(5) |
|
120,000
@ 1.25; 60,000 @ $1.50; 90,000 at $1.90; 120,000 at $3.34 and 20,000 at $2.76. |
| |
(6) |
|
All
options are vested and no options held by the Named Executive Officers are
unexercisable. Notes (1) through (5) above refer to the number of shares that
may be acquired on exercise at the stated exercise prices. |
Executive
Contracts
The Corporation has entered into
employment agreements with the Named Executive Officers which provide in each case, other
than the Chief Executive Officer, that if the Officer’s employment is terminated by
the Corporation, other than for cause, the Officer will be paid severance of two times the
Officer’s then salary and benefits. The benefits provided by the company include
automobile expenses, disability benefits, standard and extended health benefits and dental
benefits, annual RRSP contributions and benefits under a supplemental executive retirement
plan described below under “Executive Retirement Plan”. The Corporation’s
approach to determining salary, bonuses and granting stock options to executives is
discussed below under the report of the Human Resources Committee of the Board.
Human
Resources Committee
The annual base salaries and bonuses
paid to senior management of the Corporation and the benefits offered by the Corporation
in the financial year ended December 31, 2005, were determined by the Human Resources
Committee of the Board of Directors comprised of three non-employee directors formed to
administer the executive remuneration program of the Corporation. The Human Resources
Committee in respect of the financial year ended December 31, 2005 was comprised of
William E. Stanley (Chair), Catherine McLeod-Seltzer and Anthony J. Petrina. The Human
Resources Committee has determined that the annual compensation paid to senior management
of the Corporation should be equivalent to the industry standard paid to executives of
comparable corporations in the Canadian mining industry.
The Human Resources Committee has
formulated criteria to be used in determining the remuneration of senior management of the
Corporation. The Human Resources Committee annually reviews independent salary surveys to
assist it to determine executive compensation.
-8-
Human
Resources Committee Report on Executive Compensation
| |
Executive
Compensation Program |
The Corporation’s principal goal
is to create value for its shareholders. The Corporation believes that directors, officers
and employees should have their benefits aligned with both the short and long term
interests of the shareholders. To this end, the executive compensation program formulated
by the Human Resources Committee is comprised of three components: base salary, annual
cash bonus and long-term incentive in the form of stock options. It is structured to be
competitive with a select group of comparative North American gold mining companies. A
portion of the annual cash bonus is directly related to the overall performance of the
Corporation. The Human Resources Committee sets the executive compensation levels using
the PricewaterhouseCoopers 2005 annual National Mining Industries Salary Survey. The
survey is a competitive analysis of the compensation paid to mining executives in Canada.
To ensure that the Corporation is
capable of attracting, motivating and retaining individuals with exceptional executive
skills, cash compensation is reviewed and adjusted annually, based primarily on individual
and corporate performance as well as compensation practices of similar gold mining
companies. In determining base salaries and bonuses, the Human Resources Committee took
into account the financial performance of the Corporation for 2005.
The level of the base salary for each
employee of the Corporation is determined by the level of responsibility and the
importance of the position to the Corporation, within competitive industry ranges. The
Human Resources Committee determines the base salaries and bonuses for senior management
and employees of the Corporation. John Wakeford is the only of the named executive
officers that received a salary increase during 2005.
The Chief Executive Officer of the
Corporation presents recommendations to the Human Resources Committee with respect to
bonuses to be awarded to the other members of senior management and the other employees of
the Corporation. The Human Resources Committee evaluates each member of senior management
and the other employees of the Corporation in terms of their performance and the
performance of the Corporation. The Human Resources Committee then makes a determination
of the bonuses, if any, to be awarded to each member of senior management and to the
employees of the Corporation, which are reported to the Board of Directors of the
Corporation. In 2006, all of the members of the executive management team received a
performance bonus for work done in 2005.
The purpose of the Corporation’s
stock option plan is to develop the interest and incentive of eligible employees, officers
and directors in the Corporation’s growth and development by giving an opportunity to
purchase Common Shares on a favourable basis, thereby advancing the interests of the
Corporation, enhancing the value of the Common Shares for the benefit of all shareholders
and increasing the ability of the Corporation to attract and retain skilled and motivated
individuals.
Stock Options are granted in
accordance with the stock option plan approved by the shareholders (outlined below) at an
exercise price not less than the closing price of the Common Shares on the Toronto Stock
Exchange on the business day immediately prior to the date of grant. Currently there are
options to purchase of 9.450,684, common shares granted to directors, officers and
employees, representing approximately 5% of the issued shares of the Corporation on March
29, 2006.
The Human Resources Committee
previously set a program for annual stock option grants under the Corporation’s Stock
Option Plan setting the number of options to be granted for each position within the
Corporation. The Stock Option Plan is administered by the Chief Executive Officer of the
Corporation
-9-
within the program set by the Human
Resources Committee, and is intended to advance the interests of the Corporation through
the motivation, attraction and retention of key employees, officers and directors of the
Corporation and subsidiaries of the Corporation and to secure for the Corporation and its
shareholders the benefits inherent in the ownership of common shares of the Corporation
by key employees, officers and directors of the Corporation and subsidiaries of the
Corporation. Each grant of options under the Stock Option Plan is approved by the Board
of Directors of the Corporation.
The number of common shares of the
Corporation which may be subject to option under the Stock Option Plan in favour of any
one individual and in the aggregate is limited under the terms of the Stock Option Plan
and cannot be increased without shareholder and regulatory approval. Options granted under
the Stock Option Plan have a maximum term of ten years and are exercisable at a price per
share determined by the Board of Directors of the Corporation at the time the option is
granted, which price may not be less than the closing price of the common shares on The
Toronto Stock Exchange on the last trading day immediately preceding the date of grant of
the option. The options initially granted under the Stock Option Plan were approved by the
Board of Directors of the Corporation at the time of grant. All subsequent grants of
options are reviewed by the Human Resources Committee and recommended to the Board of
Directors for approval.
Compensation
of the Chief Executive Officer
The process for the setting of the
compensation of the Chief Executive Officer of the Corporation is the same as for the
other members of senior management of the Corporation. The Chief Executive Officer’s
performance is evaluated by the Human Resources Committee relative to various objectives
set for him and the Corporation.
The Human Resources Committee and the
Board of Directors continue to be of the view that Mr. Walsh provides the leadership that
permitted the Corporation to advance its initiatives in 2005 and in making their
compensation decision they considered other factors including his contribution to the
business performance and anticipated future performance of the Corporation.
In consideration of Mr. Walsh’s
contribution to the Corporation, Mr. Walsh received a salary of $320,000 and was granted
fully vested incentive stock options to purchase 240,000 common shares of the Corporation
for a period of five years. Mr. Walsh was also granted a performance bonus of $95,000 for
work done in 2005.
In 2000, the Corporation entered into
a revised employment agreement with Mr. Walsh which provides that if Mr. Walsh’s
employment is terminated without cause, he will be paid severance of three years of his
then salary. However, if his employment is terminated within twelve months of a change of
control of the Corporation, the three years severance will be based on the average salary
of chief executive officers of Canadian mining companies with fewer than 1,000 employees
according to the PricewaterhouseCoopers annual salary survey.
The Human Resources Committee has
also approved those executive officers of the Corporation who will be eligible to receive
a bonus for work done in 2006, together with enumerated and weighted objectives for each
of these executive officers for 2005. The performance evaluation of the executive officers
is primarily the responsibility of the President and CEO.
Going forward, the Human Resources
Committee and, as appropriate, the Board of Directors, will address other issues relating
to executive compensation, including the relative emphasis on the components of executive
compensation, including compensation for the Corporation’s President and CEO.
Executive Retirement Plan
The Corporation has established a
supplemental executive retirement plan for senior executives (the “Plan”). The
Plan provides that the Corporation will pay to each executive on retirement or
termination of employment a benefit equal to the difference between the amount of the
Corporation’s contributions to the
-10-
executive’s individual RRSP
plan and investment returns thereon and a pension amount based upon such executive’s
years of service and salary averaged over the highest consecutive 60 months of
employment. The senior executives who were employed by the Corporation on the Plan’s
effective date of January 1, 2003, receive credited service from January 1, 1998.
Eligible executives hired after January 1, 2003, receive credited service from the date
of eligibility as determined by the Corporation. The aggregate accrued benefit
obligations under the Plan for services to December 31, 2005 is projected to be $648,309
($362,783 Anthony Walsh, $181,921 Brian Labadie, $64,502 David Long, $10,723 Elaine
Bennett, $13,784 Heather Duggan and $14,592 John Wakeford). The Plan obligations are not
funded by the Corporation until retirement or termination and therefore the Plan had a
deficit at December 31, 2004 of $648,309.
The foregoing report dated March 29,
2006, for the financial year ended December 31, 2005 has been presented by the Human
Resources Committee.
Human Resources Committee Members:
William E. Stanley (Chairman), Catherine McLeod-Seltzer, Anthony Petrina.
Performance
Graph
The following chart compares the
total cumulative shareholder return for $100 invested in common shares of the Corporation
with the total cumulative shareholder return of the S&P/TSX Composite Index and the
total cumulative shareholder return of the S&P/TSX Gold Index for the five years ended
December 31, 2005
Five-Year Cumulative
Return on $100 Investment
Assuming Dividend Reinvestment
December 31, 2001 — December 31, 2005
Compensation of Directors
During 2005, the Corporation paid a
cash honorarium in the amount of $18,000 to each of the non-management directors for
services rendered as directors of the Corporation during the year. The amount was based
on a $12,000 retainer and $1,000 per meeting for six meetings during the year. In
addition, each director received $2,500 for each regular committee of which the director
was a member. For each committee of which the director was a chairman, the director was
compensated a further $1,000. The Corporation has five regular committees, the Executive
Committee, the Audit and Risk Management
-11-
Committee, the Safety and
Environmental Committee, the Human Resources Committee and the Corporate Governance and
Nominating Committee. Typically directors are paid $1,000 per meeting for meetings of
Committees other than regular committees. During 2005 the Board of Directors held eight
meetings which is in excess of the six meetings on which the annual retainer is based.
The Corporation paid an additional $1,000 per meeting to directors attending additional
board meetings. The Corporation also pays fees for any additional services rendered by
Directors at the regular rates for such services. The Chairman is advised of any proposed
additional services and if deemed material, board approval is obtained. During the past
year, no director provided any material additional services to the Corporation.
The following options were granted to
Directors who are not Named Executive Officers during the most recently completed
financial year:
|
|
Name |
Securities
Under Option |
% of Total
Options
Granted to
Employees in
Financial Year |
Exercise
Price |
Market Value of
Underlying
Securities at
Date of Grant |
Expiration Date |
|
| Larry Bell |
|
60,000 |
|
4.1 |
|
$1.25 |
|
$1.25 |
|
Feb 7, 2010 |
|
| |
64,706 |
|
| |
$1.28 | |
$1.28 | |
Apr 5, 2010 | |
|
| David Fennell | |
120,000 |
|
6.0 | |
$1.25 | |
$1.25 | |
Feb 7, 2010 | |
| |
60,000 |
|
| |
$1.50 | |
$1.50 | |
May 3, 2010 | |
|
| Catherine McLeod-Seltzer | |
60,000 |
|
1.90 | |
$1.25 | |
$1.25 | |
Feb 7, 2010 | |
|
| Peter Nixon | |
60,000 |
|
1.90 | |
$1.25 | |
$1.25 | |
Feb 7, 2010 | |
|
| Anthony Petrina | |
60,000 |
|
1.90 | |
$1.25 | |
$1.25 | |
Feb 7, 2010 | |
|
| Christopher Pollard | |
60,000 |
|
1.90 | |
$1.25 | |
$1.25 | |
Feb 7, 2010 | |
|
| William Stanley | |
60,000 |
|
1.90 | |
$1.25 | |
$1.25 | |
Feb 7, 2010 | |
|
For the year 2005 Mr. Bell elected to
receive a total of 64,706 options in lieu of Directors fees of $44,977. The attributed
value of the stock options was $.70 per option as determined using an option valuation
model based on the Black Scholes model. The assumptions for the Black Scholes model were:
a risk free interest rate of 3.64%; a dividend yield of 0%; an expected volatility of 60%;
and an expected life of five years.
SECURITIES AUTHORIZED
FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
This information is provided in note
11(c) to the Financial Statements of the Corporation for the year end December 31, 2005.
The Financial Statements and the Management’s Discussion and Analysis for the year
ended December 31, 2005 is available on Corporation’s website at
www.miramarmining.com or onthe SEDAR website at www.sedar.com.
-12-
CORPORATE GOVERNANCE
OF THE CORPORATION
General
The board believes that good
corporate governance improves corporate performance and benefits all shareholders. The
Canadian Securities Administrators (the “CSA”) have adopted National Policy
58-201 Corporate Governance Guidelines, which provides non-presecriptive guidlelines on
corporate governance practices for reporting issuers such as the Corporation. In addition,
the CSA have implemented National Instrument 58-101 Disclosure of Corporate Governance
Practices (“NI 58-101”), which prescribes certain disclosure by the Corporation
of its corporate governance practices. This disclosure is presented below.
Composition
and Independence of the Board of Directors
The board is currently comprised of
eight (8) directors. All are independent, for the purposes of NI 58-101 with the
exception of David Fennell, who is the Executive Vice-Chairman of the Corporation and
provides services to the Corporation through his company, Laurentian Mountain Investments
Ltd., and Anthony Walsh, who is the President and Chief Executive Officer of the
Corporation.
Anthony Petrina, the chair of the
board, is an independent director. The Board operates independently of management.
Independent members of the Board met without management present at five Board meetings
during 2005.
For each scheduled and special board
meeting in 2005, all directors were in attendance either by telephone or in person, with
the exception of the following:
|
|
Meeting Date |
Absent |
|
| January 17/05 |
|
Peter Nixon* |
|
|
| March 23/05 | |
Catherine McLeod- Seltzer | |
|
| May 10/05 | |
| |
|
| August 10/05 | |
| |
|
| October 31/05 | |
| |
|
| November 2/05 | |
| |
|
| November 10/05 | |
| |
|
| November 15/05 | |
Anthony Petrina, Catherine McLeod-Seltzer | |
|
*Mr. Nixon disqualified himself from this meeting to avoid a potential conflict of
interest.
Certain of the directors are also
directors of other reporting issuers as follows:
|
Director Name |
Other Reporting Issuer |
Bell, Lawrence |
•
•
• |
Hardwoods Distribution Income Fund
International Forest Products Limited
Wheaton River |
-13-
|
Director Name |
Other Reporting Issuer |
Fennell, David A. |
•
•
•
•
• |
Northern Mining Explorations Ltd.
New Sleeper Gold Corporation
Major Drilling Group International Inc.
Maximus Ventures Ltd.
Palmarejo Silver & Gold Corporation |
McLeod-Seltzer, C. |
•
•
•
•
•
•
|
Bear Creek Mining Corporation
Kinross Gold Corporation
Pacific Rim Mining Corp.
Silver Standard Resources Inc.
Stornoway Diamond Corporation
Peru Copper Inc. |
Nixon, Peter |
•
•
• |
Dundee Precious Metals Inc.
Stornaway Diamond Corporation
New Sleeper Gold Corporation |
Petrina, Anthony |
•
• |
Bear Creek Mining Corporation
Pacific Rim Mining Corp. |
|
Pollard, Christopher |
• |
Staccato Gold Resources Ltd. |
|
Stanley, William |
• |
Shore Gold Inc. |
Walsh, Anthony |
•
•
•
• |
Northern Mining Explorations Ltd.
AXMIN Inc.
Stornoway Diamond Corporation
Palmerejo Silver & Gold Corporation |
Board
Mandate
According to the Board Mandate, the
Board is responsible for the stewardship and te general supervision of the management of
the business of the Corporation and has final accountability for the Corporation and its
employees. The board shall act in the best interests of the Corporation and its
shareholders and will discharge its responsibilities directly and through its committees.
Each committee shall have its own mandate. The Board shall meet regularly, but not less
than once quarter to review the business operations, corporate governance and financial
results of the Corporation. Regularly scheduled meetings of the Board will also include
meetings fo the independent members of the Board without management being present. The
primary functions of the Board are to:
| |
• |
|
Perform
its duties and responsibilities in accordance with the laws of the jurisdiction of
incorporation of the Corporation; |
| |
• |
|
Oversee
and monitor the performance of the Corporation in the contest of the long term interests
of its shareholders; |
| |
• |
|
Promote
a culture of integrity; and |
| |
• |
|
Together
with management of the Corporation, develop a process for the timely and accurate
disclosure of information which is material to the Corporation. |
-14-
Position
Descriptions
The Board has developed written
position descriptions for the Board Chair, Committee Chairs and directors at large. Also,
the Board, together with the CEO has developed a written description for the CEO.
Orientation
and Continuing Education
New Board members receive an
orientation package which includes reports on operations and results, and public
disclosure filings by the Corporation. Board meetings are mostly held at the
Corporation’s facilities and are combined with tours and presentations by the
Corporation’s management and employees to give the directors additional insight into
the Corporation’s business. Board members are also encouraged, at the expense of the
Corporation, to participate in activities that enhance their knowledge of the industry and
their evolving experiences and roles as directors of the Corporation. In addition,
management of the Corporation makes itself available for discussion with all Board
members.
Ethical
Business Conduct
The Board has adopted a written Code
of Ethics by which it and all employees of the Corporation abide. All members of the
Corporation are provided with a copy of the Code of Ethics which they are required to
confirm in writing to have read and understood. A copy of the Code of Ethics is available
on SEDAR at www.sedar.com.
The Board requires all directors to
disclose any activities or relationships which could have the potential for a conflict of
interest. The Board encourages and provides an overall culture of ethical conduct. The
Board’s practice is to nurture this culture of ethical behaviour by ensuring it
conducts itself in a best practice manner. All directors and employees of the Corporation
are fully aware that violations of the Code of Ethics will be addresses with and could
result in disciplinary action or dismissal.
Nomination
of Directors
The full Board of the Corporation is
responsible for determining the competencies, skills and personal qualities it should seek
in a new Board member, in light of the opportunities and risks facing the Corporation.
Within this framework, the Corporate Governance and Nominating Committee, composed of four
independent directors, is responsible for recommending prospective Board members to fill
vacancies on the Board. The Corporate Governance and Nominating Committee, along with the
Board Chair, according to its mandate, has designed and implemented a formal process for
evaluating and assessing individual director performance on a regular basis.
Compensation
The Human Resources Committee, which
is composed entirely of independent directors, has general responsibility for developing
the Corporation’s approach to director and officer compensation. Pursuant to its
mandate, it is responsible for the following:
| 1. |
|
Reviewing
and recommending to the Board for approval the Corporation’s
compensation philosophy, policies, plans and guidelines, including annual
and ad hoc compensation plans (base pay, incentive plans and equity-based
pay), employee benefits plans and executive perquisites; |
| 2. |
|
Reviewing
and recommending to the Board for approval the annual CEO and senior
executive goals and performance objectives and assess their performance
against these objectives at each fiscal year end. In assessing the
Corporation’s performance relative to shareholder return, the
Committee is to consider the value of similar incentive awards to CEO’s
and senior executives at comparable companies and the awards given to
listed companies’ CEO’s over the prior several years; |
-15-
| 3. |
|
Reviewing
proposals concerning incentive plans and equity compensation plans
including stock option grant proposals for approval by the Board; |
| 4. |
|
Reviewing
all material proposed actions with respect to Corporation pension plans
for approval by the Board; |
| 5. |
|
Reviewing
annual CEO and executive succession plans for approval by the Board; and |
| 6. |
|
Preparing
an annual report to shareholders concerning executive compensation for
inclusion in the Corporation’s annual Management Information
Circular. |
The Committee examines the
compensation with reference to industry standards for companies of a similar size and
nature. In its current review, the Committee agreed that in most respects, Board
compensation was adequate. In the case of Committee Chairs, fees were adjusted upwards to
be brought in line with those paid by other companies of a similar size and nature and to
reflect the increased work loads that are expected of the committees.
Board
Committees
In addition to the Audit and Risk
Management Committee, the Human Resources Committee and the Corporate Governance and
Nominating Committee, the Corporation also has an Executive Committee which has been
established to oversee Corporate events that require a working group that reports to the
Board (i.e. corporate transactions) and a Safety and Environmental Committee which is
responsible to ensure that the Corporation establishes health, safety and environmental
policies for its mining operations and to review their appropriateness on an ongoing basis
and to report to the Board on a regular basis. From time to time, the Board may appoint
such additional committees as it deems necessary and appropriate in order to discharge its
duties.
Assessments
The Corporate Governance and
Nominating Committee according to its written mandate, is responsible for assessing the
performance and effectiveness of the Board as a whole and of committees of the Board.
During the year ended December 31, 2005 the Corporate Governance and Nominating Committee
conducted a formal evaluation of the performance of the Board and its committees as well
as the contributions of individual directors.
INDEBTEDNESS TO
CORPORATION OF DIRECTORS AND EXECUTIVE OFFICERS
None of the directors or executive
officers is or has been indebted to the Corporation or its subsidiaries since the
beginning of the most recently completed financial year of the Corporation.
INTEREST OF INFORMED
PERSONS IN MATERIAL TRANSACTIONS
No director or executive officer of
the Corporation, director or executive officer of a person or company that is itself an
informed person (as defined in National Instrument 51-102 “Continuous Disclosure
Obligations”) or subsidiary of the Corporation, person or company that is the direct
or indirect beneficial owner of, or who exercises control or direction over, more than 10%
of the outstanding common shares of the Corporation or any associate or affiliate of the
foregoing has any material interest, direct or indirect, in any transaction since January 2005
that has materially affected or will materially affect the Corporation other than as
described in the following paragraph.
Dundee Precious Metals Inc. (“DPMI”)
of Royal Bank Plaza, South Tower, Suite 3060, 200 Bay Street, Toronto, Ontario M5J 2J1,
owns or exercises control or direction over an aggregate of 18,917,545 Common Shares,
representing approximately 10.18% of the total number outstanding. By way of an agreement
dated February 3, 2005, the Corporation agreed to assign to DPMI all of its rights with
respect
-16-
to an option and joint venture
agreement dated February 25, 2004 (the “Option Agreement”) under which the
Corporation had the option (the “Option”) to earn from Kinross Gold Corporation
up to a 60% interest in the Back River project in Nunavut, including the Goose and George
Lakes deposits (collectively the “Properties”), in consideration for the costs
incurred by the Corporation in connection with the Option Agreement plus 5% (which amount
totalled approximately $10 million) and up to 337,500 shares of DPMI (or the cash
equivalent). DPMI will issue to the Corporation 150,000 common shares of DPMI (or the
then cash equivalent) if either (i) the total mineral resources on the Goose Lake
property are increased to 1,500,000 ounces of gold or (ii) a decision is made to place a
mine into commercial production on any of the Properties. In addition, DPMI will issue to
the Corporation an additional 187,500 common shares of DPMI (or the then cash equivalent
thereof) if DPMI exercises the Option. DPMI also reimbursed the Corporation for certain
general and administrative costs associated with the Properties. In addition, for a
period of 12 months after execution of the Assignment Agreement, the Corporation agreed
to provide office space as needed by DPMI and DPMI will reimburse the Corporation’s
out of pocket costs thereof monthly.
APPOINTMENT OF AUDITOR
The auditor of the Corporation is
KPMG LLP, Chartered Accountants. KPMG LLP have been the auditors of the Corporation since
January 5, 1994. Unless such authority is withheld, the persons named in the form of proxy
accompanying this Proxy Circular intend to vote for the appointment of KPMG LLP, Chartered
Accountants, as the auditor of the Corporation until the close of the next following
annual general meeting of the shareholders of the Corporation or until their successor is
appointed and authority is provided to the directors to fix the remuneration of the
auditor.
AUDIT COMMITTEE
The Audit and Risk Management
Committee of the Corporation consists of Larry Bell (Chair), Christopher Pollard, Peter
Nixon and William Stanley. Under Multilateral Instrument 52-110 – Audit Committees
(“MI 52-110”), companies are required to provide disclosure with respect to
their audit committee including the text of the audit committee’s charter,
composition of the audit committee and the fees paid to the external auditor. This
information is provided in the Corporation’s annual information form dated March 29,
2006 (the “AIF”) with respect to the fiscal year ended December 31, 2005. The
AIF is available for review by the public on the SEDAR website located at www.sedar.com
“Company Profiles – Miramar Mining Corporation”. Management of the
Corporation strongly encourages its shareholders to review the AIF. INTEREST OF CERTAIN
PERSONS or companies IN MATTERS TO BE ACTED UPON
Except as set out herein, no director
or executive officer of the Corporation or any proposed nominee of management of the
Corporation for election as a director of the Corporation, nor any associate or affiliate
of the foregoing persons, has any material interest, direct or indirect, by way of
beneficial ownership of securities or otherwise, in matters to be acted upon at the
Meeting.
PARTICULARS OF MATTERS
TO BE ACTED UPON
Removal
of Pre-Existing Company Provisions and Adoption of New Articles
On March 29, 2004, British Columbia
adopted the Business Corporations Act (the “New Act”) to replace the
Company Act (the “Former Act”), which previously governed the
Corporation. To make the laws governing British Columbia corporations more consistent with
other Canadian and United States jurisdictions and to provide shareholders with a greater
choice of effective governance structures, the New Act removes many of the restrictions
contained in the Former Act, including restrictions on the residency of directors,
limitations on the location of annual general meetings and limits on authorized share
structure. As well the New Act uses new forms and terminology.
-17-
| I. |
|
Removal
of Pre-Existing Company Provisions |
Under the New Act, a company remains
subject to “Pre-existing Company Provisions” (as defined in the Business
Corporations Act) contained in its corporate documents until the shareholders remove the
Pre-existing Company Provisions by special resolution and a Notice of Alteration to the
Notice of Articles has been filed with the Registrar of Companies to remove the
Pre-existing Company Provisions. Given the Corporation’s status as a public company,
only two Pre-existing Company Provisions would continue to apply to the Corporation
following the completion of its transition under the New Act unless removed:
| 1. |
|
Under
the Pre-existing Company Provisions, if a company offers to purchase any
of its own shares, it must extend the offer on a proportionate basis to
all shareholders holding shares of the class or series of shares subject
to the offer, subject to certain exceptions. The New Act does not contain
a similar provision. While the exceptions to this proportionate purchase
requirement would, in the vast majority of cases, allow the Corporation to
purchase its shares without having to extend the offer to purchase to all
shareholders holding those shares, Management believes that this
restriction may unduly limit flexibility in future transactions where the
ability to repurchase some, but not all of its shares from shareholders
may be necessary or desirable. Accordingly, if shareholders approve the
removal of the application of the Pre-existing Company Provisions, this
requirement will no longer apply to the Corporation. Any such repurchases
remain subject to compliance with applicable securities legislation and
stock exchange rules and policies. |
| 2. |
|
The
Pre-existing Company Provisions would also maintain the requirement under
the Former Act that no less than three-quarters of the votes cast at a
general meeting must vote in favour of a proposed special resolution in
order for that special resolution to be passed. Under the New Act, with
shareholder approval, the Corporation may reduce the level of the majority
required to pass some or all special resolutions to two-thirds of the
votes cast at a general meeting. Management and the Board of Directors
believe that the reduced threshold for special resolutions will provide
the Corporation with greater flexibility for future corporate activities
and is consistent with companies incorporated in other jurisdictions.
Accordingly, subject to shareholder approval to the special resolutions
below, the proposed New Articles will reflect the lower threshold for
special resolutions. |
In order to remove the application of
the Pre-existing Company Provisions, the shareholders of the Corporation will be asked at
the Meeting to pass the following special resolution:
“BE IT RESOLVED, as a special
resolution, that:
| |
(a) |
|
the
Notice of Articles of the Corporation be altered to remove the application
of the Pre-existing Company Provisions (as defined in the Business
Corporations Act of British Columbia) and that the Pre-existing
Company Provisions be and are hereby removed and no longer apply to
the Corporation; and |
| |
(b) |
|
any
one director or officer of the Corporation be and is hereby authorized to
execute and deliver all such documents and instruments, including the
Notice of Alteration reflecting the removal of the Pre-existing
Company Provisions, and to do such further acts, as may be necessary
to give full effect to this special resolution.” |
The foregoing Special Resolution will
not be effective, and the Pre-existing Company Provisions will continue to apply to the
Corporation, until a Notice of Alteration to the Notice of Articles to remove the
Pre-existing Company Provisions has been filed with the Registrar of Companies.
| II. |
|
Replacement
of Articles |
The existing Articles (the “Existing
Articles”) of the Corporation were adopted in 1985 and contain provisions that
relate to restrictions contained in the Former Act and that are no longer required under
the New Act. As such, management is seeking shareholder approval to replace the
Corporation’s Existing
-18-
Articles with new Articles (the
“New Articles”) which will incorporate some of the more flexible provisions of
the New Act. Management and the Board of Directors believe that replacing the Corporation’s
Existing Articles with the New Articles will enable the Corporation to be more efficient,
flexible and cost-effective and will bring the Corporation’s charter documents into
line with the New Act.
A discussion regarding the main
differences between the Corporation’s Existing Articles and the proposed New Articles
is attached as Schedule “A”, which Shareholders are encouraged to review. A
copy of the New Articles has been included with the proxy materials for the Meeting.
Any amendment to a company’s
articles must receive shareholder approval by way of special resolution. Accordingly, the
Shareholders will be asked at the Meeting to pass the following special resolution:
“BE IT RESOLVED, as a special
resolution, that:
| |
(a) |
|
the
Articles of the Corporation be altered by deleting and cancelling the
Existing Articles and creating and adopting the New Articles as the
Articles of the Corporation, provided that any alteration in the New
Articles that would render incomplete or incorrect any information in
the Notice of Articles of the Corporation shall not take effect until
the Notice of Articles of the Corporation is altered to reflect such
alteration; |
| |
(b) |
|
the
New Articles shall state the Corporation’s name and authorized share
structure and be amended to reflect any changes to the Corporation’s
name and authorized share structure; |
| |
(c) |
|
any
one director or officer of the Corporation be and is hereby authorized to
execute and deliver and file all such notices, documents and
instruments, including the required Notice of Alteration, and to do
such further acts, as he in his discretion may deem necessary to give
full effect to this special resolution; and |
| |
(d) |
|
the
board of directors of the Corporation is hereby authorized at any time in
its absolute discretion, to determine whether or not to proceed with
the foregoing without further approval, ratification or confirmation
by the shareholders of the Corporation.” |
In order to be effective, the
proposed special resolutions must be approved by a three-quarters (75%) majority vote cast
by those shareholders of the Corporation who, being entitled to do so, vote in person or
by proxy at the Meeting in respect of such resolutions.
Management and the Board of Directors
believe that the passing of the foregoing special resolutions is in the best interest of
the Corporation and recommend that shareholders vote in favour of the special resolutions.
IT IS THE INTENTION OF THE PERSONS
DESIGNATED BY MANAGEMENT AS PROXYHOLDERS IN THE FORM OF PROXY WHICH ACCOMPANIES THIS
INFORMATION CIRCULAR TO VOTE THE SHARES REPRESENTED IN A PROXY IN FAVOUR OF THE FOREGOING
SPECIAL RESOLUTIONS UNLESS SUCH PROXY SPECIFIES THAT THE SHARES IT REPRESENTS ARE TO BE
VOTED AGAINST SUCH RESOLUTIONS.
ADDITIONAL INFORMATION
A copy of the recent Annual Report,
including management discussion and analysis, and financial statements of the Corporation
for the most recently completed financial year is enclosed with these materials. A copy
of the most recent Form 40F/Annual Information Form filed by the Corporation may be
obtained upon written request from the Secretary of the Corporation to #300-889
Harbourside Drive, North Vancouver, British Columbia Canada, V7P 3S1. The Corporation may
require the payment of a reasonable fee for providing a copy of the foregoing documents
to a person who is not a security holder of
-19-
the Corporation. Additional
information relating to the Corporation may also be retrieved from SEDAR as www.sedar.com.
APPROVAL
The contents and the sending of this
management information circular have been approved by the directors of the Corporation.
|
Dated March 29, 2006 |
Anthony P. Walsh
President & Chief Executive Officer
|
SCHEDULE “A”
PROPOSED CHANGES TO
ARTICLES OF THE CORPORATION
Set out below is a discussion of the
changes proposed under the New Articles. These proposed changes to the New Articles
include a discussion of substantive changes included in the New Articles and changes
included that are as a result of changes under the New Act. The New Articles incorporate a
number of non-substantive changes, including the use of the new terminology adopted under
the New Act. For example, “members” are now “shareholders” and
“register of members” is now “central securities register” under the
New Act. Many of these non-substantive terminology and wording changes are not discussed
in detail here, as they reflect statutory requirements that the Corporation cannot alter
or amend. For full particulars, please refer to the text of the proposed New Articles, a
copy of which has been included with the proxy materials for the Meeting.
The following is a discussion of the
substantive changes proposed in the New Articles.
| |
Under
the Existing Articles, the Corporation may borrow money, issue debt and mortgage, charge,
or give security on the undertaking, or on the whole or any part of the property and
assets, of the Corporation (both present and future). However, under the New Act,
companies are now also permitted, without restriction, to guarantee repayment of money by
any other person or the performance of any obligation of any other person. This change
reflects the modernization of corporate legislation to effectively respond to
increasingly complex financial transactions that companies may enter into in the course
of their businesses. As a result, the New Articles provide that the Corporation will be
able to guarantee the repayment of money by any other person or the performance of any
obligation of any other person. Management believes that it is in the best interests of
the Corporation to allow for such a guarantee to permit the Corporation the maximum
flexibility in possible future financial transactions, recognizing the duties directors
have to ensure that the guarantee must always be in the best interest of the Corporation
and its shareholders. |
| |
Directors’Authority
to Set Auditor’s Remuneration |
| |
Under
the New Act, the Corporation is, subject to shareholder approval, permitted to include in
the New Articles authorization for the directors to set the remuneration paid to the
auditors of the Corporation. The Former Act required the shareholders to set the
remuneration or the shareholders to authorize, on an annual basis, the directors to set
the remuneration. Historically, shareholders of the Corporation have always authorized
the directors to appoint the auditors and to set the auditor’s remuneration. As a
result, the inclusion of the authority for directors to set the auditor’s
remuneration in the New Articles merely codifies existing practice. More importantly,
however, this change also codifies new corporate governance rules and regulations
relating to audit committees and the appointment and remuneration of auditors. |
| |
Special
Majority for Resolutions |
| |
Under
the Former Act, the number of votes required to pass a special resolution at a general
meeting was three-quarters of the votes cast on a resolution. Under the New Act, the
Corporation is authorized to determine whether a special resolution requires two-thirds
or three-quarters of the votes cast on a resolution. The Existing Articles did not state
what the majority was for a special resolution, as this matter was dealt with under the
Former Act. The New Articles propose that the passage of a special resolution will
require a majority of two-thirds of the votes cast on a resolution. |
| |
Under
the Former Act, the maximum discount or commission payable on the issuance of a share of
the Corporation was 25%. Under the New Act the Corporation is, subject to shareholder |
-2-
| |
approval,
now permitted to avoid setting a numerical maximum for a discount or commission payable
on the issuance of a share but rather limit any discount or commission by a test of
reasonableness. The New Articles provide that the Corporation is permitted to pay or
offer the commission or discount as permitted in the New Act. Management of the
Corporation believes that the 25% maximum limit should not be set out in the New
Articles, as such a limit does not consider factual circumstances nor apply a test of
reasonableness. By limiting the discount or commission amounts payable by the test of
reasonableness, exercised by directors with a duty to act in the best interest of the
Corporation, the Corporation is provided greater flexibility in possible future
transactions. In addition, since the Corporation is a public company, it is subject to
the requirements of the Toronto Stock Exchange on share issuances and discounts and
commissions, which requirements are generally more stringent than the Former Act
provisions. |
| |
Delivery
of Documents to Shareholders |
| |
As
a result of changes under the New Act, the New Articles now permit the delivery of
documents to a shareholder by facsimile transmission, email and any other method
permitted under securities legislation, so long as the shareholder consents and provides
its facsimile number, email address or other authorized delivery method. This change
reflects recent developments under securities legislation. As part of its efforts to
modernize and adopt new, less expensive methods of shareholder communication, management
believes it is in the best interests of the Corporation to allow for facsimile
transmission, email and other permitted methods of delivery of documents to shareholders.
As a result, the New Articles allow the Corporation to deliver documents to shareholders
by facsimile transmission, email and other methods permitted under securities
legislation. |
| |
As
a result of changes under the New Act, the New Articles now permit shareholders to
deposit their proxies for shareholder meetings through mail or facsimile delivery or any
other method of transmitting legibly recorded messages. This reflects a general movement
by corporations to adopt easier and faster ways for shareholders to communicate with
corporations. As part of its efforts to modernize and adopt new, less expensive methods
of shareholder communication, management believes it is in the best interests of the
Corporation to allow for proxies to be deposited using facsimile, email and other methods
permitted under securities legislation. |
| |
Under
the Existing Articles, if the Corporation made an offer to purchase any of its own
shares, it was required to extend the offer on a proportionate basis to all shareholders
holding the same class or series of shares that were subject to the offer, subject to
certain exceptions. As this is no longer a requirement of the New Act, the New Articles
do not contain a similar provision. |
The following are changes to the
provisions contained in the New Act which have an effect on provisions contained in the
Existing Articles:
| |
Under
the Existing Articles, the Corporation was required to have at least a President and
Secretary as officers, and there had to be separate individuals holding those positions.
In addition, the President was required to be a director of the Corporation. These were
requirements under the Former Act. However, under the New Act, those requirements no
longer exist, and as a result, the New Articles do not contain these requirements.
Management and the board of directors believe that by removing these restrictions the
Corporation is better able to meet its corporate governance obligations as to membership
of the board of directors. |
-3-
| |
Publication
of Advance Notice of Meeting |
| |
Under
the Existing Articles, the Corporation was required to publish notice of a general
meeting of shareholders in the manner required under the Former Act. Under the New Act,
the Corporation is no longer required to publish notice of general meetings, and recent
changes to securities legislation in Canada requires that all public companies, including
the Corporation, post advance notice of a general meeting on www.sedar.com in
advance of the record date for the meeting. As a result, the New Articles do not contain
a requirement to publish advance notice of the meeting. |
| |
Under
the Existing Articles, a shareholder is entitled to a share certificate representing the
number of shares of the Corporation he or she holds. Under the New Act, a shareholder is
now entitled to a share certificate representing the number of shares of the Corporation
he or she holds or a written acknowledgement of the shareholder’s right to obtain
such a share certificate. As a result, the New Articles provide for this additional
right. The addition of the ability to issue a written acknowledgement is very useful for
public companies such as the Corporation, since it permits flexibility in corporate and
securities transactions. |
| |
Disclosure
of Interest of Directors |
| |
Under
the New Act, the provisions relating to the disclosure of interests by directors have
been revised and updated. As directors of the Corporation are bound by these provisions,
the New Articles do not contain reference to the old disclosure of interest provisions
and refer instead to the provisions contained in the New Act. |
| |
Under
the New Act, the provisions relating to directors’ meetings have been revised and
updated to allow directors to participate by telephone or other communications mediums,
so long as the directors are able to communicate with each other. The New Articles
broaden the ability of directors to participate in meetings through other communication
mediums to allow directors who may not be able to attend in person to still participate
in meetings of the directors. |
| |
In
addition, the New Articles allow directors to receive notices of meetings by electronics
means, which allows for quicker and more efficient communication with directors of the
Corporation. |
| |
Under
the Former Act, the Corporation could only indemnify directors where it obtained prior
court approval, except in certain limited circumstances. The Existing Articles provided
for the Corporation to indemnify directors, subject to the requirements of the Former
Act. Under the New Act, the Corporation is now permitted to indemnify a past or present
director or officer of the Corporation without obtaining prior court approval in respect
of an “eligible proceeding”. An “eligible proceeding” includes any
legal proceeding relating to the activities of the individual as a director or officer of
the Corporation. However, under the New Act, the Corporation is prohibited from paying an
indemnity if: |
| |
(a) |
|
the
party did not act honestly and in good faith with a view to the best
interests of the Corporation; |
| |
(b) |
|
the
proceeding was not a civil proceeding and the party did not have reasonable
grounds for believing that his or her conduct was lawful; and |
| |
(c) |
|
the
proceeding is brought against the party by the Corporation or an associated
corporation. |
-4-
| |
As
a result, the New Articles allow the Corporation to indemnify directors, officers,
employees and agents, subject to the limits imposed under the New Act. Management
believes that it is in the best interests of the Corporation to allow the indemnification
of directors, officers, employees and agents, subject to the limits and conditions of the
New Act. |
| |
Holding
of Annual General Meetings |
| |
Under
the Former Act, annual general meetings were required to be held within 13 months of the
last annual general meeting. The New Act allows for annual general meetings to be held
once in each calendar year and not more than 15 months after the last annual general
meeting and accordingly, the New Articles reflect this provision. |
| |
Location
of Shareholder Meetings |
| |
Under
the Former Act, shareholder meetings were required to be held in British Columbia, unless
an application was made and accepted by the registrar to hold the meeting elsewhere.
Under the New Act, companies may hold shareholder meetings at a location outside of
British Columbia. Accordingly, the New Articles allow for the Corporation to hold
meetings outside of British Columbia. |
EXHIBIT 3
PROXY
ANNUAL AND SPECIAL GENERAL MEETING OF SHAREHOLDERS OF
MIRAMAR MINING CORPORATION (the "Company")
TO BE HELD IN THE SHUSWAP ROOM OF THE FOUR SEASONS HOTEL,
791 WEST GEORGIA STREET,
VANCOUVER, BRITISH COLUMBIA, CANADA
ON WEDNESDAY, MAY 3, 2006 AT 10:00 AM
The undersigned shareholder ("Registered Shareholder") of the Company hereby
appoints, ANTHONY WALSH, President, Chief Executive Officer and a Director of
the Company, or failing this person, ANTHONY PETRINA, Chairman of the Board and
a Director of the Company, or in the place of the foregoing, ___________________
as proxyholder for and on behalf of the Registered Shareholder with the power of
substitution to attend, act and vote for and on behalf of the Registered
Shareholder in respect of all matters that may properly come before the
aforesaid meeting of the shareholders of the Company (the "Meeting") and at
every adjournment thereof, to the same extent and with the same powers as if the
undersigned Registered Shareholder were present at the said Meeting, or any
adjournment thereof.
The Registered Shareholder hereby directs the proxyholder to vote the securities
of the Company recorded in the name of the Registered Shareholder as specified
herein.
The undersigned Registered Shareholder hereby revokes any proxy previously given
to attend and vote at said Meeting.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Resolutions (For full details of each item, please see the enclosed Notice of
Meeting and Information Circular)
================================================================================
For Against Withhold
--------------------------------------------------------------------------------
1. Appointment of KPMG LLP, Chartered Accountants N/A
as auditors of the Company and authorization
of the Directors to fix the Auditor's
remuneration
2. To determine the number of directors at Eight N/A
(8)
3. To elect as Director, LAWRENCE BELL N/A
4. To elect as Director, DAVID FENNELL N/A
5. To elect as Director, CATHERINE McLEOD-SELTZER N/A
6. To elect as Director, PETER NIXON N/A
7. To elect as Director, ANTHONY J. PETRINA N/A
8. To elect as Director, CHRISTOPHER J. POLLARD N/A
9. To elect as Director, WILLIAM STANLEY N/A
10. To elect as Director, ANTHONY WALSH N/A
11. Pursuant to the enactment of the Business
Corporations Act and the repeal of
the Company Act, to approve, by special
resolution, the removal of the Pre-existing
Company Provisions, as more particularly set
out in the Company's information circular
dated April 7, 2006. N/A
12. Pursuant to the enactment of the Business
Corporations Act and the repeal of
the Company Act, to approve, by special
resolution, the replacement of the Company's
Existing Articles with the New Articles,
as more particularly set out in the Company's
information circular dated April 7, 2006. N/A
================================================================================
SECURITYHOLDER SIGN HERE: __________________________________
DATE SIGNED: ______________________________
THIS FORM MUST BE SIGNED AND DATED ABOVE.
INSTRUCTIONS FOR COMPLETION OF PROXY
1. This Proxy is solicited by the Management of the Company.
2. This form of proxy ("Instrument of Proxy") must be signed by you, the
Registered Shareholder, or by your attorney duly authorized by you in
writing, or, in the case of a corporation, by a duly authorized officer or
representative of the corporation; and if executed by an attorney, officer,
or other duly appointed representative, the original or a notarial copy of
the instrument so empowering such person, or such other documentation in
support as shall be acceptable to the Chairman of the Meeting, must
accompany the Instrument of Proxy.
3. If this Instrument of Proxy is not dated in the space provided, authority
is hereby given by you, the Registered Shareholder, for the proxyholder to
date this proxy April 7, 2006, the date on which it was mailed to you, the
Registered Shareholder, by Pacific Corporate Trust Company.
4. A Registered Shareholder who wishes to attend the Meeting and vote on the
resolutions in person, may register with the scrutineers before the Meeting
begins.
5. A Registered Shareholder who is not able to attend the Meeting in person
but wishes to vote on the resolutions, may do the following:
(a) appoint one of the management proxyholders named on the Instrument of
Proxy, by leaving the wording appointing a nominee as is (i.e. do not
strike out the management proxyholders shown and do not complete the blank
space provided for the appointment of an alternate proxyholder). Where no
choice is specified by a Registered Shareholder with respect to a
resolution set out in the Instrument of Proxy, a management appointee
acting as a proxyholder will vote on the resolution as if the Registered
Shareholder had specified an affirmative vote;
OR
(b) appoint another proxyholder, who need not be a Registered Shareholder
of the Company, to vote according to the Registered Shareholder's
instructions, by striking out the management proxyholder names shown and
inserting the name of the person you wish to represent you at the Meeting
in the space provided for an alternate proxyholder. If no choice is
specified, the proxyholder has discretionary authority to vote as the
proxyholder sees fit.
6. The securities represented by this Instrument of Proxy will be voted or
withheld from voting in accordance with the instructions of the Registered
Shareholder on any poll on a resolution that may be called for and, if the
Registered Shareholder specifies a choice with respect to any matter to be
acted upon, the securities will be voted accordingly. Further, if so
authorized by this Instrument of Proxy, the securities will be voted by the
appointed proxyholder with respect to any amendments or variations of any
of the resolutions set out on the Instrument of Proxy or matters which may
properly come before the Meeting as the proxyholder in its sole discretion
sees fit.
7. If a Registered Shareholder has submitted an Instrument of Proxy, the
Registered Shareholder may still attend the Meeting and may vote in person.
To do so, the Registered Shareholder must record his/her attendance with
the scrutineers before the commencement of the Meeting and revoke, in
writing, the prior votes.
================================================================================
To be represented at the Meeting, voting instructions must be
DEPOSITED at the office of COMPANY" no later than 5:00PM, Vancouver time,
on May 1, 2006 or in the case of an adjournment of the Meeting,
not later than 5:00PM, Vancouver time, on the business day prior to
the time of the reconvened Meeting.
The mailing address of Pacific Corporate Trust Company is
2nd floor, 510 Burrard Street Vancouver, British Columbia, V6C 3B9,
and its fax number is (604) 689-8144.
IF A SHAREHOLDER I.D. AND SHAREHOLDER CODE APPEAR ON THE FACE OF THIS PROXY
IN THE ADDRESS BOX REGISTERED HOLDERS ARE ABLE TO COMPLETE TELEPHONE
VOTING AT 1-888-Tel-Vote (1-888-835-8683) OR INTERNET VOTING AT
http://www.stocktronics.com/webvote
================================================================================
EXHIBIT 4
MIRAMAR MINING CORPORATION
(the “Company”)
The Company has as its articles the
following articles.
Incorporation number:
BC0258867
MIRAMAR MINING CORPORATION
(the “Company”)
ARTICLES
|
|
| 1. INTERPRETATION |
|
1 |
|
| 2. SHARES AND SHARE CERTIFICATES | |
1 |
|
| 3. ISSUE OF SHARES | |
3 |
|
| 4. SHARE REGISTERS | |
3 |
|
| 5. SHARE TRANSFERS | |
4 |
|
| 6. TRANSMISSION OF SHARES | |
5 |
|
| 7. PURCHASE OF SHARES | |
5 |
|
| 8. BORROWING POWERS | |
6 |
|
| 9. ALTERATIONS | |
6 |
|
| 10. MEETINGS OF SHAREHOLDERS | |
7 |
|
| 11. PROCEEDINGS AT MEETINGS OF SHAREHOLDERS | |
9 |
|
| 12. VOTES OF SHAREHOLDERS | |
12 |
|
| 13. DIRECTORS | |
15 |
|
| 14. ELECTION AND REMOVAL OF DIRECTORS | |
17 |
|
| 15. ALTERNATE DIRECTORS | |
19 |
|
| 16. POWERS AND DUTIES OF DIRECTORS | |
20 |
|
| 17. INTERESTS OF DIRECTORS AND OFFICERS | |
21 |
|
| 18. PROCEEDINGS OF DIRECTORS | |
22 |
|
| 19. EXECUTIVE AND OTHER COMMITTEES | |
24 |
|
| 20. OFFICERS | |
25 |
|
| 21. INDEMNIFICATION | |
26 |
|
| 22. DIVIDENDS | |
27 |
|
| 23. ACCOUNTING RECORDS AND AUDITORS | |
28 |
|
| 24. NOTICES | |
29 |
|
| 25. SEAL | |
30 |
|
In these Articles, unless the context
otherwise requires:
| (1) |
|
“board
of directors”, “directors” and “board” mean the
directors or sole director of the Company for the time being; |
| (2) |
|
“Business
Corporations Act” means the Business Corporations Act (British
Columbia) from time to time in force and all amendments thereto and includes
all regulations and amendments thereto made pursuant to that Act; |
| (3) |
|
“Interpretation
Act” means the Interpretation Act (British Columbia) from time to time in
force and all amendments thereto and includes all regulations and amendments
thereto made pursuant to that Act; |
| (4) |
|
“legal
personal representative” means the personal or other legal representative
of the shareholder; |
| (5) |
|
“registered
address” of a shareholder means the shareholder’s address as recorded
in the central securities register; |
| (6) |
|
“seal” means
the seal of the Company, if any. |
| 1.2 |
|
Business
Corporations Act and Interpretation Act Definitions Applicable |
The definitions in the Business
Corporations Act and the definitions and rules of construction in the
Interpretation Act, with the necessary changes, so far as applicable, and unless
the context requires otherwise, apply to these Articles as if they were an enactment. If
there is a conflict between a definition in the Business Corporations Act and a
definition or rule in the Interpretation Act relating to a term used in these
Articles, the definition in the Business Corporations Act will prevail in relation
to the use of the term in these Articles. If there is a conflict or inconsistency between
these Articles and the Business Corporations Act, the Business Corporations Act
will prevail.
| 2. |
|
SHARES
AND SHARE CERTIFICATES |
| 2.1 |
|
Authorized
Share Structure |
The authorized share structure of the
Company consists of 500,000,000 common shares without par value.
| 2.2 |
|
Form
of Share Certificate |
Each share certificate issued by the
Company must comply with, and be signed as required by, the Business Corporations
Act.
| 2.3 |
|
Shareholder
Entitled to Certificate or Acknowledgment |
Each shareholder is entitled, without
charge, to (a) one share certificate representing the shares of each class or series
of shares registered in the shareholder’s name or (b) a non-transferable written
acknowledgment of the shareholder’s right to obtain such a share certificate,
provided that in respect of a share held jointly by several persons, the Company is not
bound to issue more than one share certificate or acknowledgment and delivery of a share
certificate or an acknowledgment to one of several joint shareholders or to a duly
authorized agent of one of the joint shareholders will be sufficient delivery to all.
- 2 -
Any share certificate or
non-transferable written acknowledgment of a shareholder’s right to obtain a share
certificate may be sent to the shareholder by mail at the shareholder’s registered
address and neither the Company nor any director, officer or agent of the Company is
liable for any loss to the shareholder because the share certificate or acknowledgement is
lost in the mail or stolen.
| 2.5 |
|
Replacement
of Worn Out or Defaced Certificate or Acknowledgement |
If the directors are satisfied that a
share certificate or a non-transferable written acknowledgment of the shareholder’s
right to obtain a share certificate is worn out or defaced, they must, on production to
them of the share certificate or acknowledgment, as the case may be, and on such other
terms, if any, as they think fit:
| (1) |
|
order
the share certificate or acknowledgment, as the case may be, to be cancelled;
and |
| (2) |
|
issue
a replacement share certificate or acknowledgment, as the case may be. |
| 2.6 |
|
Replacement
of Lost, Stolen or Destroyed Certificate or Acknowledgment |
If a share certificate or a
non-transferable written acknowledgment of a shareholder’s right to obtain a share
certificate is lost, stolen or destroyed, a replacement share certificate or
acknowledgment, as the case may be, must be issued to the person entitled to that share
certificate or acknowledgment, as the case may be, if the directors receive:
| (1) |
|
proof
satisfactory to them that the share certificate or acknowledgment is lost,
stolen or destroyed; and |
| (2) |
|
any
indemnity the directors consider adequate. |
| 2.7 |
|
Splitting
Share Certificates |
If a shareholder surrenders a share
certificate to the Company with a written request that the Company issue in the
shareholder’s name two or more share certificates, each representing a specified
number of shares and in the aggregate representing the same number of shares as the share
certificate so surrendered, the Company must cancel the surrendered share certificate and
issue replacement share certificates in accordance with that request.
There must be paid to the Company, in
relation to the issue of any share certificate under Articles 2.5, 2.6 or 2.7, the
amount, if any and which must not exceed the amount prescribed under the Business
Corporations Act, determined by the directors.
| 2.9 |
|
Recognition
of Trusts |
Except as required by law or statute
or these Articles, no person will be recognized by the Company as holding any share upon
any trust, and the Company is not bound by or compelled in any way to recognize (even when
having notice thereof) any equitable, contingent, future or partial interest in any share
or fraction of a share or (except as required by law or statute or these Articles or as
ordered by a court of competent jurisdiction) any other rights in respect of any share
except an absolute right to the entirety thereof in the shareholder.
- 3 -
Subject to the Business
Corporations Act and the rights, if any, of the holders of issued shares of the
Company, the Company may issue, allot, sell or otherwise dispose of the unissued shares,
and issued shares held by the Company, at the times, to the persons, including directors,
in the manner, on the terms and conditions and for the issue prices (including any premium
at which shares with par value may be issued) that the directors may determine. The issue
price for a share with par value must be equal to or greater than the par value of the
share.
| 3.2 |
|
Commissions
and Discounts |
The Company may at any time, pay a
reasonable commission or allow a reasonable discount to any person in consideration of
that person purchasing or agreeing to purchase shares of the Company from the Company or
any other person or procuring or agreeing to procure purchasers for shares of the Company.
The Company may pay such brokerage
fee or other consideration as may be lawful for or in connection with the sale or
placement of its securities.
Except as provided for by the
Business Corporations Act, no share may be issued until it is fully paid. A share
is fully paid when:
| (1) |
|
consideration
is provided to the Company for the issue of the share by one or more of the
following: |
| |
(a) |
|
past
services performed for the Company; |
| (2) |
|
the
value of the consideration received by the Company equals or exceeds the issue
price set for the share under Article 3.1. |
| 3.5 |
|
Share
Purchase Warrants and Rights |
Subject to the Business
Corporations Act, the Company may issue share purchase warrants, options and rights
upon such terms and conditions as the directors determine, which share purchase warrants,
options and rights may be issued alone or in conjunction with debentures, debenture stock,
bonds, shares or any other securities issued or created by the Company from time to time.
| 4.1 |
|
Central
Securities Register |
As required by and subject to the
Business Corporations Act, the Company must maintain in British Columbia a central
securities register. The directors may, subject to the Business Corporations Act,
appoint an agent to maintain the central securities register. The directors may also
appoint one or more agents, including the agent which keeps the central securities
register, as transfer agent for its shares or any class or series of its shares, as the
case may be, and the same or another agent as registrar for its shares or such class or
series of its shares, as the case may be. The directors may terminate such appointment of
any agent at any time and may appoint another agent in its place.
- 4 -
The Company must not at any time
close its central securities register.
| 5.1 |
|
Registering
Transfers |
A transfer of a share of the Company
must not be registered unless the Company or the transfer agent or registrar for the class
or series of share to be transferred has received:
| (1) |
|
a
duly signed instrument of transfer in respect of the share; |
| (2) |
|
if
a share certificate has been issued by the Company in respect of the share to
be transferred, that share certificate; |
| (3) |
|
if
a non-transferable written acknowledgment of the shareholder’s right to
obtain a share certificate has been issued by the Company in respect of the
share to be transferred, that acknowledgment; and |
| (4) |
|
such
other evidence, if any, as the Company or the transfer agent or registrar for
the class or series of share to be transferred may require to prove the title
of the transferor or the transferor’s right to transfer the share, the due
signing of the instrument of transfer and the right of the transferee to have
the transfer registered. |
| 5.2 |
|
Form
of Instrument of Transfer |
The instrument of transfer in respect
of any share of the Company must be either in the form, if any, on the back of the
Company’s share certificates or in any other form that may be approved by the
directors from time to time.
| 5.3 |
|
Transferor
Remains Shareholder |
Except to the extent that the
Business Corporations Act otherwise provides, the transferor of shares is deemed to
remain the holder of the shares until the name of the transferee is entered in a
securities register of the Company in respect of the transfer.
| 5.4 |
|
Signing
of Instrument of Transfer |
If a shareholder, or his or her duly
authorized attorney, signs an instrument of transfer in respect of shares registered in
the name of the shareholder, the signed instrument of transfer constitutes a complete and
sufficient authority to the Company and its directors, officers and agents to register the
number of shares specified in the instrument of transfer or specified in any other manner,
or, if no number is specified, all the shares represented by the share certificates or set
out in the written acknowledgments deposited with the instrument of transfer:
| (1) |
|
in
the name of the person named as transferee in that instrument of transfer; or |
| (2) |
|
if
no person is named as transferee in that instrument of transfer, in the name of
the person on whose behalf the instrument is deposited for the purpose of
having the transfer registered. |
| 5.5 |
|
Enquiry
as to Title Not Required |
Neither the Company nor any director,
officer or agent of the Company is bound to inquire into the title of the person named in
the instrument of transfer as transferee or, if no person is named as transferee in the
instrument of transfer, of the person on whose behalf the instrument is deposited for the
purpose of having the transfer registered or is liable for any claim related to
registering the transfer by the shareholder or by any intermediate owner or holder
- 5 -
of the shares, of any interest in the
shares, of any share certificate representing such shares or of any written acknowledgment
of a right to obtain a share certificate for such shares.
There must be paid to the Company, in
relation to the registration of any transfer, the amount, if any, determined by the
directors.
| 6. |
|
TRANSMISSION
OF SHARES |
| 6.1 |
|
Legal
Personal Representative Recognized on Death |
In case of the death of a
shareholder, the legal personal representative of the shareholder, or in the case of
shares registered in the shareholder’s name and the name of another person in joint
tenancy, the surviving joint holder, will be the only person recognized by the Company as
having any title to the shareholder’s interest in the shares. Before recognizing a
person as a legal personal representative of a shareholder, the directors may require
proof of appointment by a court of competent jurisdiction, a grant of letters probate,
letters of administration or such other evidence or documents as the directors consider
appropriate.
| 6.2 |
|
Rights
of Legal Personal Representative |
The legal personal representative of
a shareholder has the same rights, privileges and obligations that attach to the shares
held by the shareholder, including the right to transfer the shares in accordance with
these Articles, provided the documents required by the Business Corporations Act
and the directors have been deposited with the Company. This Article 6.2 does not
apply in the case of the death of a shareholder with respect to shares registered in the
shareholder’s name and the name of another person in joint tenancy.
| 7.1 |
|
Company
Authorized to Purchase Shares |
Subject to Article 7.2, the
special rights and restrictions attached to the shares of any class or series and the
Business Corporations Act, the Company may, if authorized by the directors,
purchase or otherwise acquire any of its shares at the price and upon the terms determined
by the directors.
| 7.2 |
|
Purchase
When Insolvent |
The Company must not make a payment
or provide any other consideration to purchase or otherwise acquire any of its shares if
there are reasonable grounds for believing that:
| (1) |
|
the
Company is insolvent; or |
| (2) |
|
making
the payment or providing the consideration would render the Company insolvent. |
| 7.3 |
|
Sale
and Voting of Purchased Shares |
If the Company retains a share
redeemed, purchased or otherwise acquired by it, the Company may sell, gift or otherwise
dispose of the share, but, while such share is held by the Company, it:
| (1) |
|
is
not entitled to vote the share at a meeting of its shareholders; |
| (2) |
|
must
not pay a dividend in respect of the share; and |
| (3) |
|
must
not make any other distribution in respect of the share. |
- 6 -
The Company, if authorized by the
directors, may:
| (1) |
|
borrow
money in the manner and amount, on the security, from the sources and on the
terms and conditions that they consider appropriate; |
| (2) |
|
issue
bonds, debentures and other debt obligations either outright or as security for
any liability or obligation of the Company or any other person and at such
discounts or premiums and on such other terms as they consider appropriate; |
| (3) |
|
guarantee
the repayment of money by any other person or the performance of any obligation
of any other person; and |
| (4) |
|
mortgage,
charge, whether by way of specific or floating charge, grant a security
interest in, or give other security on, the whole or any part of the present
and future assets and undertaking of the Company. |
| 9.1 |
|
Alteration
of Authorized Share Structure |
Subject to Article 9.2 and the
Business Corporations Act, the Company may by special resolution:
| (1) |
|
create
one or more classes or series of shares or, if none of the shares of a class or
series of shares are allotted or issued, eliminate that class or series of
shares; |
| (2) |
|
increase,
reduce or eliminate the maximum number of shares that the Company is authorized
to issue out of any class or series of shares or establish a maximum number of
shares that the Company is authorized to issue out of any class or series of
shares for which no maximum is established; |
| (3) |
|
subdivide
or consolidate all or any of its unissued, or fully paid issued, shares; |
| (4) |
|
if
the Company is authorized to issue shares of a class of shares with par value: |
| |
(a) |
|
decrease
the par value of those shares; or |
| |
(b) |
|
if
none of the shares of that class of shares are allotted or issued, increase the
par value of those shares; |
| (5) |
|
change
all or any of its unissued, or fully paid issued, shares with par value into
shares without par value or any of its unissued shares without par value into
shares with par value; |
| (6) |
|
alter
the identifying name of any of its shares; or |
| (7) |
|
otherwise
alter its shares or authorized share structure when required or permitted to do
so by the Business Corporations Act; |
and, if applicable, alter its Notice
of Articles and, if applicable, its Articles, accordingly.
| 9.2 |
|
Special
Rights and Restrictions |
Subject to the Business
Corporations Act, the Company may by special resolution:
- 7 -
| (1) |
|
create
special rights or restrictions for, and attach those special rights or
restrictions to, the shares of any class or series of shares, whether or not
any or all of those shares have been issued; or |
| (2) |
|
vary
or delete any special rights or restrictions attached to the shares of any
class or series of shares, whether or not any or all of those shares have been
issued; |
and alter its Articles and Notice of
Articles accordingly.
The Company may by special resolution
authorize an alteration of its Notice of Articles in order to change its name and may, by
ordinary resolution or directors’ resolution, adopt or change any translation of that
name.
If the Business Corporations
Act does not specify the type of resolution and these Articles do not specify another
type of resolution, the Company may by ordinary resolution alter these Articles.
| 10. |
|
MEETINGS
OF SHAREHOLDERS |
| 10.1 |
|
Annual
General Meetings |
Unless an annual general meeting is
deferred or waived in accordance with the Business Corporations Act, the Company
must hold its first annual general meeting within 18 months after the date on which it was
incorporated or otherwise recognized, and after that must hold an annual general meeting
at least once in each calendar year and not more than 15 months after the last annual
reference date at such time and place as may be determined by the directors.
| 10.2 |
|
Resolution
Instead of Annual General Meeting |
If all the shareholders who are
entitled to vote at an annual general meeting consent by a unanimous resolution to all of
the business that is required to be transacted at that annual general meeting, the annual
general meeting is deemed to have been held on the date of the unanimous resolution. The
shareholders must, in any unanimous resolution passed under this Article 10.2, select
as the Company’s annual reference date a date that would be appropriate for the
holding of the applicable annual general meeting.
| 10.3 |
|
Calling
of Meetings of Shareholders |
The directors may, at any time, call
a meeting of shareholders.
| 10.4 |
|
Location
of Meetings of Shareholders |
Subject to the Business
Corporations Act, a meeting of shareholders may be held in or outside of British
Columbia as determined by a resolution of the directors.
| 10.5 |
|
Notice
for Meetings of Shareholders |
The Company must send notice of the
date, time and location of any meeting of shareholders (including, without limitation, any
notice specifying the intention to propose a resolution as an exceptional resolution, a
special resolution or a special separate resolution and any notice to consider approving
an amalgamation into a foreign jurisdiction, an arrangement or the adoption of an
amalgamation agreement, and any notice of a general meeting, class meeting or series
meeting), in the manner provided in these Articles, or in such other manner, if any, as
may be prescribed by ordinary resolution (whether previous notice of the resolution has
been given or not), to each
- 8 -
shareholder entitled to attend the
meeting, to each director and to the auditor of the Company, unless these Articles
otherwise provide, at least the following number of days before the meeting:
| (1) |
|
if
and for so long as the Company is a public company, 21 days; |
| 10.6 |
|
Notice
of Resolution to Which Shareholders May Dissent |
The Company must send to each of its
shareholders, whether or not their shares carry the right to vote, a notice of any meeting
of shareholders at which a resolution entitling shareholders to dissent is to be
considered specifying the date of the meeting and containing a statement advising of the
right to send a notice of dissent together with a copy of the proposed resolution at least
the following number of days before the meeting:
| (1) |
|
if
and for so long as the Company is a public company, 21 days; |
| 10.7 |
|
Record
Date for Notice |
The directors may set a date as the
record date for the purpose of determining shareholders entitled to notice of any meeting
of shareholders. The record date must not precede the date on which the meeting is to be
held by more than two months or, in the case of a general meeting requisitioned by
shareholders under the Business Corporations Act, by more than four months. The
record date must not precede the date on which the meeting is held by fewer than:
| (1) |
|
if
and for so long as the Company is a public company, 21 days; |
If no record date is set, the record
date is 5 p.m. on the day immediately preceding the first date on which the notice is
sent or, if no notice is sent, the beginning of the meeting.
| 10.8 |
|
Record
Date for Voting |
The directors may set a date as the
record date for the purpose of determining shareholders entitled to vote at any meeting of
shareholders. The record date must not precede the date on which the meeting is to be held
by more than two months or, in the case of a general meeting requisitioned by shareholders
under the Business Corporations Act, by more than four months. If no record date is
set, the record date is 5 p.m. on the day immediately preceding the first date on
which the notice is sent or, if no notice is sent, the beginning of the meeting.
| 10.9 |
|
Failure
to Give Notice and Waiver of Notice |
The accidental omission to send
notice of any meeting of shareholders to, or the non-receipt of any notice by, any of the
persons entitled to notice does not invalidate any proceedings at that meeting. Any person
entitled to notice of a meeting of shareholders may, in writing or otherwise, waive that
entitlement or may agree to reduce the period of that notice. Attendance of a person at a
meeting of shareholders is a waiver of entitlement to notice of the meeting unless that
person attends the meeting for the express purpose of objecting to the transaction of any
business on the grounds that the meeting is not lawfully called.
| 10.10 |
|
Notice
of Special Business at Meetings of Shareholders |
If a meeting of shareholders is to
consider special business within the meaning of Article 11.1, the notice of meeting
must:
| (1) |
|
state
the general nature of the special business; and |
- 9 -
| (2) |
|
if
the special business includes considering, approving, ratifying, adopting or
authorizing any document or the signing of or giving of effect to any document,
have attached to it a copy of the document or state that a copy of the document
will be available for inspection by shareholders: |
| |
(a) |
|
at
the Company’s records office, or at such other reasonably accessible
location in British Columbia as is specified in the notice; and |
| |
(b) |
|
during
statutory business hours on any one or more specified days before the day set
for the holding of the meeting. |
| 11. |
|
PROCEEDINGS
AT MEETINGS OF SHAREHOLDERS |
At a meeting of shareholders, the
following business is special business:
| (1) |
|
at
a meeting of shareholders that is not an annual general meeting, all business
is special business except business relating to the conduct of or voting
at the meeting; |
| (2) |
|
at
an annual general meeting, all business is special business except for the
following: |
| |
(a) |
|
business
relating to the conduct of or voting at the meeting; |
| |
(b) |
|
consideration
of any financial statements of the Company presented to the meeting; |
| |
(c) |
|
consideration
of any reports of the directors or auditor; |
| |
(d) |
|
the
setting or changing of the number of directors; |
| |
(e) |
|
the
election or appointment of directors; |
| |
(f) |
|
the
appointment of an auditor; |
| |
(g) |
|
the
setting of the remuneration of an auditor; |
| |
(h) |
|
business
arising out of a report of the directors not requiring the passing of a
special resolution or an exceptional resolution; |
| |
(i) |
|
any
other business which, under these Articles or the Business Corporations
Act, may be transacted at a meeting of shareholders without prior
notice of the business being given to the shareholders. |
The majority of votes required for
the Company to pass a special resolution at a general meeting of shareholders is 2/3 of
the votes cast on the resolution.
Subject to the special rights and
restrictions attached to the shares of any class or series of shares and to
Article 11.4, the quorum for the transaction of business at a meeting of shareholders
is two persons who are, or who represent by proxy, shareholders who, in the aggregate,
hold at least 5% of the issued shares entitled to be voted at the meeting.
- 10 -
| 11.4 |
|
One
Shareholder May Constitute Quorum |
If there is only one shareholder
entitled to vote at a meeting of shareholders:
| (1) |
|
the
quorum is one person who is, or who represents by proxy, that shareholder, and |
| (2) |
|
that
shareholder, present in person or by proxy, may constitute the meeting. |
| 11.5 |
|
Persons
Entitled to Attend Meeting |
In addition to those persons who are
entitled to vote at a meeting of shareholders, the only other persons entitled to be
present at the meeting are the directors, the president (if any), the secretary (if any),
the assistant secretary (if any), any lawyer for the Company, the auditor of the Company,
any persons invited to be present at the meeting by the directors or by the chair of the
meeting and any persons entitled or required under the Business Corporations Act or
these Articles to be present at the meeting; but if any of those persons does attend the
meeting, that person is not to be counted in the quorum and is not entitled to vote at the
meeting unless that person is a shareholder or proxy holder entitled to vote at the
meeting.
| 11.6 |
|
Requirement
of Quorum |
No business, other than the election
of a chair of the meeting and the adjournment of the meeting, may be transacted at any
meeting of shareholders unless a quorum of shareholders entitled to vote is present at the
commencement of the meeting, but such quorum need not be present throughout the meeting.
If, within one-half hour from the
time set for the holding of a meeting of shareholders, a quorum is not present:
| (1) |
|
in
the case of a general meeting requisitioned by shareholders, the meeting is
dissolved, and |
| (2) |
|
in
the case of any other meeting of shareholders, the meeting stands adjourned to
the same day in the next week at the same time and place. |
| 11.8 |
|
Lack
of Quorum at Succeeding Meeting |
If, at the meeting to which the
meeting referred to in Article 11.7(2) was adjourned, a quorum is not present within
one-half hour from the time set for the holding of the meeting, the person or persons
present and being, or representing by proxy, one or more shareholders entitled to attend
and vote at the meeting constitute a quorum.
The following individual is entitled
to preside as chair at a meeting of shareholders:
| (1) |
|
the
chair of the board, if any; |
| (2) |
|
if
the chair of the board is absent or unwilling to act as chair of the meeting,
the president, if any; or |
| (3) |
|
a
vice-president, if any. |
| 11.10 |
|
Selection
of Alternate Chair |
If, at any meeting of shareholders,
there is no chair of the board or president present within 15 minutes after the time
set for holding the meeting, or if the chair of the board and the president are unwilling
to act as chair of the meeting, or if the chair of the board and the president have
advised the secretary, if any, or any director present at the meeting, that they will not
be present at the meeting, the directors present must choose one of their number to be
- 11 -
chair of the meeting or if all of the
directors present decline to take the chair or fail to so choose or if no director is
present, the shareholders entitled to vote at the meeting who are present in person or by
proxy may choose any person present at the meeting to chair the meeting.
The chair of a meeting of
shareholders may, and if so directed by the meeting must, adjourn the meeting from time to
time and from place to place, but no business may be transacted at any adjourned meeting
other than the business left unfinished at the meeting from which the adjournment took
place.
| 11.12 |
|
Notice
of Adjourned Meeting |
It is not necessary to give any
notice of an adjourned meeting of shareholders or of the business to be transacted at an
adjourned meeting of shareholders except that, when a meeting is adjourned for
30 days or more, notice of the adjourned meeting must be given as in the case of the
original meeting.
| 11.13 |
|
Decisions
by Show of Hands or Poll |
Subject to the Business
Corporations Act, every motion put to a vote at a meeting of shareholders will be
decided on a show of hands unless a poll, before or on the declaration of the result of
the vote by show of hands, is directed by the chair or demanded by at least one
shareholder entitled to vote who is present in person or by proxy.
| 11.14 |
|
Declaration
of Result |
The chair of a meeting of
shareholders must declare to the meeting the decision on every question in accordance with
the result of the show of hands or the poll, as the case may be, and that decision must be
entered in the minutes of the meeting. A declaration of the chair that a resolution is
carried by the necessary majority or is defeated is, unless a poll is directed by the
chair or demanded under Article 11.13, conclusive evidence without proof of the
number or proportion of the votes recorded in favour of or against the resolution.
| 11.15 |
|
Motion
Need Not be Seconded |
No motion proposed at a meeting of
shareholders need be seconded unless the chair of the meeting rules otherwise, and the
chair of any meeting of shareholders is entitled to propose or second a motion.
In case of an equality of votes, the
chair of a meeting of shareholders does not, either on a show of hands or on a poll, have
a second or casting vote in addition to the vote or votes to which the chair may be
entitled as a shareholder.
| 11.17 |
|
Manner
of Taking Poll |
Subject to Article 11.18, if a
poll is duly demanded at a meeting of shareholders:
| (1) |
|
the
poll must be taken: |
| |
(a) |
|
at
the meeting, or within seven days after the date of the meeting, as the chair
of the meeting directs; and |
| |
(b) |
|
in
the manner, at the time and at the place that the chair of the meeting directs; |
| (2) |
|
the
result of the poll is deemed to be the decision of the meeting at which the
poll is demanded; and |
| (3) |
|
the
demand for the poll may be withdrawn by the person who demanded it. |
- 12 -
| 11.18 |
|
Demand
for Poll on Adjournment |
A poll demanded at a meeting of
shareholders on a question of adjournment must be taken immediately at the meeting.
| 11.19 |
|
Chair
Must Resolve Dispute |
In the case of any dispute as to the
admission or rejection of a vote given on a poll, the chair of the meeting must determine
the dispute, and his or her determination made in good faith is final and conclusive.
On a poll, a shareholder entitled to
more than one vote need not cast all the votes in the same way.
| 11.21 |
|
No
Demand for Poll on Election of Chair |
No poll may be demanded in respect of
the vote by which a chair of a meeting of shareholders is elected.
| 11.22 |
|
Demand
for Poll Not to Prevent Continuance of Meeting |
The demand for a poll at a meeting of
shareholders does not, unless the chair of the meeting so rules, prevent the continuation
of a meeting for the transaction of any business other than the question on which a poll
has been demanded.
| 11.23 |
|
Retention
of Ballots and Proxies |
The Company must, for at least three
months after a meeting of shareholders, keep each ballot cast on a poll and each proxy
voted at the meeting, and, during that period, make them available for inspection during
normal business hours by any shareholder or proxyholder entitled to vote at the meeting.
At the end of such three month period, the Company may destroy such ballots and proxies.
| 12. |
|
VOTES
OF SHAREHOLDERS |
| 12.1 |
|
Number
of Votes by Shareholder or by Shares |
Subject to any special rights or
restrictions attached to any shares and to the restrictions imposed on joint shareholders
under Article 12.3:
| (1) |
|
on
a vote by show of hands, every person present who is a shareholder or proxy
holder and entitled to vote on the matter has one vote; and |
| (2) |
|
on
a poll, every shareholder entitled to vote on the matter has one vote in
respect of each share entitled to be voted on the matter and held by that
shareholder and may exercise that vote either in person or by proxy. |
| 12.2 |
|
Votes
of Persons in Representative Capacity |
A person who is not a shareholder may
vote at a meeting of shareholders, whether on a show of hands or on a poll, and may
appoint a proxy holder to act at the meeting, if, before doing so, the person satisfies
the chair of the meeting, or the directors, that the person is a legal personal
representative or a trustee in bankruptcy for a shareholder who is entitled to vote at the
meeting.
| 12.3 |
|
Votes
by Joint Holders |
If there are joint shareholders
registered in respect of any share:
- 13 -
| (1) |
|
any
one of the joint shareholders may vote at any meeting of shareholders, either
personally or by proxy, in respect of the share as if that joint shareholder
were solely entitled to it; or |
| (2) |
|
if
more than one of the joint shareholders is present at any meeting of
shareholders, personally or by proxy, and more than one of them votes in
respect of that share, then only the vote of the joint shareholder present
whose name stands first on the central securities register in respect of the
share will be counted. |
| 12.4 |
|
Legal
Personal Representatives as Joint Shareholders |
Two or more legal personal
representatives of a shareholder in whose sole name any share is registered are, for the
purposes of Article 12.3, deemed to be joint shareholders registered in respect of
that share.
| 12.5 |
|
Representative
of a Corporate Shareholder |
If a corporation, that is not a
subsidiary of the Company, is a shareholder, that corporation may appoint a person to act
as its representative at any meeting of shareholders of the Company, and:
| (1) |
|
for
that purpose, the instrument appointing a representative must be received: |
| |
(a) |
|
at
the registered office of the Company or at any other place specified, in the
notice calling the meeting, for the receipt of proxies, at least the
number of business days specified in the notice for the receipt of
proxies, or if no number of days is specified, two business days before
the day set for the holding of the meeting or any adjourned meeting; or |
| |
(b) |
|
at
the meeting or any adjourned meeting, by the chair of the meeting or
adjourned meeting or by a person designated by the chair of the meeting or
adjourned meeting; |
| (2) |
|
if
a representative is appointed under this Article 12.5: |
| |
(a) |
|
the
representative is entitled to exercise in respect of and at that meeting the
same rights on behalf of the corporation that the representative
represents as that corporation could exercise if it were a shareholder who
is an individual, including, without limitation, the right to appoint a
proxy holder; and |
| |
(b) |
|
the
representative, if present at the meeting, is to be counted for the purpose
of forming a quorum and is deemed to be a shareholder present in person at
the meeting. |
Evidence of the appointment of any
such representative may be sent to the Company by written instrument, fax or any other
method of transmitting legibly recorded messages.
| 12.6 |
|
Proxy
Provisions Do Not Apply to All Companies |
If and for so long as the Company is
a public company or a pre-existing reporting company which has the Statutory Reporting
Company Provisions as part of its Articles or to which the Statutory Reporting Company
Provisions apply, Articles 12.7 to 12.15 apply only insofar as they are not
inconsistent with any securities legislation in any province or territory of Canada or in
the federal jurisdiction of the United States or in any states of the United States that
is applicable to the Company and insofar as they are not inconsistent with the regulations
and rules made and promulgated under that legislation and all administrative policy
statements, blanket orders and rulings, notices and other administrative directions issued
by securities commissions or similar authorities appointed under that legislation.
| 12.7 |
|
Appointment
of Proxy Holders |
Every shareholder of the Company,
including a corporation that is a shareholder but not a subsidiary of the Company,
entitled to vote at a meeting of shareholders of the Company may, by proxy, appoint one or
more (but not
- 14 -
more than five) proxy holders to
attend and act at the meeting in the manner, to the extent and with the powers conferred
by the proxy.
| 12.8 |
|
Alternate
Proxy Holders |
A shareholder may appoint one or more
alternate proxy holders to act in the place of an absent proxy holder.
| 12.9 |
|
When
Proxy Holder Need Not Be Shareholder |
A person must not be appointed as a
proxy holder unless the person is a shareholder, although a person who is not a
shareholder may be appointed as a proxy holder if:
| (1) |
|
the
person appointing the proxy holder is a corporation or a representative of a
corporation appointed under Article 12.5; |
| (2) |
|
the
Company has at the time of the meeting for which the proxy holder is to be
appointed only one shareholder entitled to vote at the meeting; or |
| (3) |
|
the
shareholders present in person or by proxy at and entitled to vote at the
meeting for which the proxy holder is to be appointed, by a resolution on which
the proxy holder is not entitled to vote but in respect of which the proxy
holder is to be counted in the quorum, permit the proxy holder to attend and
vote at the meeting. |
A proxy for a meeting of shareholders
must:
| (1) |
|
be
received at the registered office of the Company or at any other place
specified, in the notice calling the meeting, for the receipt of proxies, at
least the number of business days specified in the notice, or if no number of
days is specified, two business days before the day set for the holding of the
meeting or any adjourned meeting; or |
| (2) |
|
unless
the notice provides otherwise, be received at the meeting or any adjourned
meeting, by the chair of the meeting or adjourned meeting or by a person
designated by the chair of the meeting or adjourned meeting. |
A proxy may be sent to the Company by
written instrument, fax or any other method of transmitting legibly recorded messages.
| 12.11 |
|
Validity
of Proxy Vote |
A vote given in accordance with the
terms of a proxy is valid notwithstanding the death or incapacity of the shareholder
giving the proxy and despite the revocation of the proxy or the revocation of the
authority under which the proxy is given, unless notice in writing of that death,
incapacity or revocation is received:
| (1) |
|
at
the registered office of the Company, at any time up to and including the last
business day before the day set for the holding of the meeting or any adjourned
meeting at which the proxy is to be used; or |
| (2) |
|
at
the meeting or any adjourned meeting, by the chair of the meeting or adjourned
meeting, before any vote in respect of which the proxy has been given has been
taken. |
A proxy, whether for a specified
meeting or otherwise, must be either in the following form or in any other form approved
by the directors or the chair of the meeting:
- 15 -
[name of company]
(the “Company”)
| |
The
undersigned, being a shareholder of the Company, hereby appoints [name] or,
failing that person, [name], as proxy holder for the undersigned to attend, act
and vote for and on behalf of the undersigned at the meeting of shareholders of the
Company to be held on [month, day, year] and at any adjournment of that meeting. |
| |
Number
of shares in respect of which this proxy is given (if no number is specified, then this
proxy is given in respect of all shares registered in the name of the undersigned): |
| |
Signed [month, day, year]
_______________________________
[Signature of shareholder]
_______________________________
[Name of shareholder—printed]
|
| 12.13 |
|
Revocation
of Proxy |
Subject to Article 12.14, every
proxy may be revoked by an instrument in writing that is received:
| (1) |
|
at
the registered office of the Company at any time up to and including the last
business day before the day set for the holding of the meeting or any adjourned
meeting at which the proxy is to be used; or |
| (2) |
|
at
the meeting or any adjourned meeting by the chair of the meeting or adjourned
meeting, before any vote in respect of which the proxy has been given has been
taken. |
| 12.14 |
|
Revocation
of Proxy Must Be Signed |
An instrument referred to in
Article 12.13 must be signed as follows:
| (1) |
|
if
the shareholder for whom the proxy holder is appointed is an individual, the
instrument must be signed by the shareholder or his or her legal personal
representative or trustee in bankruptcy; |
| (2) |
|
if
the shareholder for whom the proxy holder is appointed is a corporation, the
instrument must be signed by the corporation or by a representative appointed
for the corporation under Article 12.5. |
| 12.15 |
|
Production
of Evidence of Authority to Vote |
The chair of any meeting of
shareholders may, but need not, inquire into the authority of any person to vote at the
meeting and may, but need not, demand from that person production of evidence as to the
existence of the authority to vote.
| 13.1 |
|
First
Directors; Number of Directors |
The first directors are the persons
designated as directors of the Company in the Notice of Articles that applies to the
Company when it is recognized under the Business Corporations Act. The number of
directors, excluding additional directors appointed under Article 14.8, is set at:
| (1) |
|
if
the Company is a public company, the greater of three and the most recently set
of: |
- 16 -
| |
(a) |
|
the
number of directors set by ordinary resolution (whether or not previous notice
of the resolution was given); and |
| |
(b) |
|
the
number of directors set under Article 14.4; |
| (2) |
|
if
the Company is not a public company, the most recently set of: |
| |
(a) |
|
the
number of directors set by ordinary resolution (whether or not previous notice
of the resolution was given); and |
| |
(b) |
|
the
number of directors set under Article 14.4. |
| 13.2 |
|
Change
in Number of Directors |
If the number of directors is set
under Articles 13.1(1)(a) or 13.1(2)(a):
| (1) |
|
the
shareholders may elect or appoint the directors needed to fill any vacancies in
the board of directors up to that number; |
| (2) |
|
if
the shareholders do not elect or appoint the directors needed to fill any
vacancies in the board of directors up to that number contemporaneously with
the setting of that number, then the directors, subject to Article 14.8,
may appoint, or the shareholders may elect or appoint, directors to fill those
vacancies. |
| 13.3 |
|
Directors’Acts
Valid Despite Vacancy |
An act or proceeding of the directors
is not invalid merely because fewer than the number of directors set or otherwise required
under these Articles is in office.
| 13.4 |
|
Qualifications
of Directors |
A director is not required to hold a
share in the capital of the Company as qualification for his or her office but must be
qualified as required by the Business Corporations Act to become, act or continue
to act as a director.
| 13.5 |
|
Remuneration
of Directors |
The directors are entitled to the
remuneration for acting as directors, if any, as the directors may from time to time
determine. If the directors so decide, the remuneration of the directors, if any, will be
determined by the shareholders. That remuneration may be in addition to any salary or
other remuneration paid to any officer or employee of the Company as such, who is also a
director.
| 13.6 |
|
Reimbursement
of Expenses of Directors |
The Company must reimburse each
director for the reasonable expenses that he or she may incur in and about the business of
the Company.
| 13.7 |
|
Special
Remuneration for Directors |
If any director performs any
professional or other services for the Company that in the opinion of the directors are
outside the ordinary duties of a director, or if any director is otherwise specially
occupied in or about the Company’s business, he or she may be paid remuneration fixed
by the directors, or, at the option of that director, fixed by ordinary resolution, and
such remuneration may be either in addition to, or in substitution for, any other
remuneration that he or she may be entitled to receive.
- 17 -
| 13.8 |
|
Gratuity,
Pension or Allowance on Retirement of Director |
Unless otherwise determined by
ordinary resolution, the directors on behalf of the Company may pay a gratuity or pension
or allowance on retirement to any director who has held any salaried office or place of
profit with the Company or to his or her spouse or dependants and may make contributions
to any fund and pay premiums for the purchase or provision of any such gratuity, pension
or allowance.
| 14. |
|
ELECTION
AND REMOVAL OF DIRECTORS |
| 14.1 |
|
Election
at Annual General Meeting |
| (1) |
|
At
each annual general meeting of the Company all the directors whose term of
office expire at such annual general meeting shall cease to hold office
immediately before the election of directors at such annual general meeting and
the shareholders entitled to vote thereat shall elect to the board of
directors, directors as otherwise permitted by any securities legislation in
any province or territory of Canada or in the federal jurisdiction of the
United States or in any states of the United States that is applicable to the
Company and all regulations and rules made and promulgated under that
legislation and all administrative policy statements, blanket orders and
rulings, notices and other administrative directions issued by securities
commissions or similar authorities appointed under that legislation as set out
below. A retiring director shall be eligible for re-election; |
| (2) |
|
Each
director may be elected for a term of office of one or more years of office as
may be specified by ordinary resolution at the time he is elected. In the
absence of any such ordinary resolution, a director’s term of office shall
be one year of office. No director shall be elected for a term of office
exceeding five years of office. The shareholders may, by resolution of not less
than 3/4 of the votes cast on the resolution, vary the term of office of any
director; and |
| (3) |
|
A
director elected or appointed to fill a vacancy shall be elected or appointed
for a term expiring immediately before the election of directors at the annual
general meeting of the Company when the term of the director whose position he
is filling would expire. |
| 14.2 |
|
Consent
to be a Director |
No election, appointment or
designation of an individual as a director is valid unless:
| (1) |
|
that
individual consents to be a director in the manner provided for in the Business
Corporations Act; |
| (2) |
|
that
individual is elected or appointed at a meeting at which the individual is
present and the individual does not refuse, at the meeting, to be a director;
or |
| (3) |
|
with
respect to first directors, the designation is otherwise valid under the Business
Corporations Act. |
| 14.3 |
|
Failure
to Elect or Appoint Directors |
If:
| (1) |
|
the
Company fails to hold an annual general meeting, and all the shareholders who
are entitled to vote at an annual general meeting fail to pass the unanimous
resolution contemplated by Article 10.2, on or before the date by which
the annual general meeting is required to be held under the Business
Corporations Act; or |
| (2) |
|
the
shareholders fail, at the annual general meeting or in the unanimous resolution
contemplated by Article 10.2, to elect or appoint any directors; |
then each director then in office
continues to hold office until the earlier of:
- 18 -
| (3) |
|
when
his or her successor is elected or appointed; and |
| (4) |
|
when
he or she otherwise ceases to hold office under the Business Corporations Act or
these Articles. |
| 14.4 |
|
Places
of Retiring Directors Not Filled |
If, at any meeting of shareholders at
which there should be an election of directors, the places of any of the retiring
directors are not filled by that election, those retiring directors who are not re-elected
and who are asked by the newly elected directors to continue in office will, if willing to
do so, continue in office to complete the number of directors for the time being set
pursuant to these Articles until further new directors are elected at a meeting of
shareholders convened for that purpose. If any such election or continuance of directors
does not result in the election or continuance of the number of directors for the time
being set pursuant to these Articles, the number of directors of the Company is deemed to
be set at the number of directors actually elected or continued in office.
| 14.5 |
|
Directors
May Fill Casual Vacancies |
Any casual vacancy occurring in the
board of directors may be filled by the directors.
| 14.6 |
|
Remaining
Directors’ Power to Act |
The directors may act notwithstanding
any vacancy in the board of directors, but if the Company has fewer directors in office
than the number set pursuant to these Articles as the quorum of directors, the directors
may only act for the purpose of appointing directors up to that number or of calling a
meeting of shareholders for the purpose of filling any vacancies on the board of directors
or, subject to the Business Corporations Act, for any other purpose.
| 14.7 |
|
Shareholders
May Fill Vacancies |
If the Company has no directors or
fewer directors in office than the number set pursuant to these Articles as the quorum of
directors, the shareholders may elect or appoint directors to fill any vacancies on the
board of directors.
| 14.8 |
|
Additional
Directors |
Notwithstanding Articles 13.1
and 13.2, between annual general meetings or unanimous resolutions contemplated by
Article 10.2, the directors may appoint one or more additional directors, but the
number of additional directors appointed under this Article 14.8 must not at any time
exceed one-third of the number of the current directors who were elected or appointed as
directors other than under this Article 14.8.
Any director so appointed ceases to
hold office immediately before the next election or appointment of directors under
Article 14.1(1), but is eligible for re-election or re-appointment.
| 14.9 |
|
Ceasing
to be a Director |
A director ceases to be a director
when:
| (1) |
|
the
term of office of the director expires; |
| (3) |
|
the
director resigns as a director by notice in writing provided to the Company or
a lawyer for the Company; or |
| (4) |
|
the
director is removed from office pursuant to Articles 14.10 or 14.11. |
- 19 -
| 14.10 |
|
Removal
of Director by Shareholders |
The Company may remove any director
before the expiration of his or her term of office by special resolution. In that event,
the shareholders may elect, or appoint by ordinary resolution, a director to fill the
resulting vacancy. If the shareholders do not elect or appoint a director to fill the
resulting vacancy contemporaneously with the removal, then the directors may appoint or
the shareholders may elect, or appoint by ordinary resolution, a director to fill that
vacancy.
| 14.11 |
|
Removal
of Director by Directors |
The directors may remove any director
before the expiration of his or her term of office if the director is convicted of an
indictable offence, or if the director ceases to be qualified to act as a director of a
company and does not promptly resign, and the directors may appoint a director to fill the
resulting vacancy.
| 15.1 |
|
Appointment
of Alternate Director |
Any director (an
“appointor”) may by notice in writing received by the Company appoint any person
(an “appointee”) who is qualified to act as a director to be his or her
alternate to act in his or her place at meetings of the directors or committees of the
directors at which the appointor is not present unless (in the case of an appointee who is
not a director) the directors have reasonably disapproved the appointment of such person
as an alternate director and have given notice to that effect to his or her appointor
within a reasonable time after the notice of appointment is received by the Company. Every
alternate director shall have a direct and personal duty to the Company arising from his
alternate directorship, independent of the duties of the director who appointed him.
Every alternate director so appointed
is entitled to notice of meetings of the directors and of committees of the directors of
which his or her appointor is a member and to attend and vote as a director at any such
meetings at which his or her appointor is not present.
| 15.3 |
|
Alternate
for More Than One Director Attending Meetings |
A person may be appointed as an
alternate director by more than one director, and an alternate director:
| (1) |
|
will
be counted in determining the quorum for a meeting of directors once for each
of his or her appointors and, in the case of an appointee who is also a
director, once more in that capacity; |
| (2) |
|
has
a separate vote at a meeting of directors for each of his or her appointors
and, in the case of an appointee who is also a director, an additional vote in
that capacity; |
| (3) |
|
will
be counted in determining the quorum for a meeting of a committee of directors
once for each of his or her appointors who is a member of that committee and,
in the case of an appointee who is also a member of that committee as a
director, once more in that capacity; |
| (4) |
|
has
a separate vote at a meeting of a committee of directors for each of his or her
appointors who is a member of that committee and, in the case of an appointee
who is also a member of that committee as a director, an additional vote in
that capacity. |
Every alternate director, if
authorized by the notice appointing him or her, may sign in place of his or her appointor
any resolutions to be consented to in writing.
- 20 -
| 15.5 |
|
Alternate
Director Not an Agent |
Every alternate director is deemed
not to be the agent of his or her appointor and shall be deemed not to have any conflict
arising out of any interest, property or office held by the appointor. An alternate
director shall be deemed to be a director for all purposes of these Articles, with full
power to act as a director, subject to any limitations in the instrument appointing him,
and an alternate director shall be entitled to all of the indemnities and similar
protections afforded directors by the Business Corporations Act and under these
Articles. A director shall have no liability arising out of any act or omission by his
alternate director to which the appointor was not a party, nor shall an alternate director
have liability for any such act or omission by the appointor. Without limiting the
foregoing, no duty to account to the Company shall be imposed upon an alternate director
merely because he voted in respect of a contract or transaction in which the appointor was
interested or which the appointor failed to disclose, nor shall any such duty be imposed
upon an appointor merely because he voted in respect of a contract or transaction in which
his alternate director was interested or which such alternate director failed to disclose.
| 15.6 |
|
Revocation
of Appointment of Alternate Director |
An appointor may at any time, by
notice in writing received by the Company, revoke the appointment of an alternate director
appointed by him or her.
| 15.7 |
|
Ceasing
to be an Alternate Director |
The appointment of an alternate
director ceases when:
| (1) |
|
his
or her appointor ceases to be a director and is not promptly re-elected or
re-appointed; |
| (2) |
|
the
alternate director dies; |
| (3) |
|
the
alternate director resigns as an alternate director by notice in writing
provided to the Company or a lawyer for the Company; |
| (4) |
|
the
alternate director ceases to be qualified to act as a director; or |
| (5) |
|
his
or her appointor revokes the appointment of the alternate director. |
| 15.8 |
|
Remuneration
and Expenses of Alternate Director |
The Company may reimburse an
alternate director for the reasonable expenses that would be properly reimbursed if he or
she were a director, and the alternate director is entitled to receive from the Company
such proportion, if any, of the remuneration otherwise payable to the appointor as the
appointor may from time to time direct.
| 16. |
|
POWERS
AND DUTIES OF DIRECTORS |
| 16.1 |
|
Powers
of Management |
The directors must, subject to the
Business Corporations Act and these Articles, manage or supervise the management of
the business and affairs of the Company and have the authority to exercise all such powers
of the Company as are not, by the Business Corporations Act or by these Articles,
required to be exercised by the shareholders of the Company.
| 16.2 |
|
Appointment
of Attorney of Company |
The directors may from time to time,
by power of attorney or other instrument, under seal if so required by law, appoint any
person to be the attorney of the Company for such purposes, and with such powers,
authorities and discretions (not exceeding those vested in or exercisable by the directors
under these Articles and excepting the
- 21 -
power to fill vacancies in the board
of directors, to remove a director, to change the membership of, or fill vacancies in, any
committee of the directors, to appoint or remove officers appointed by the directors and
to declare dividends) and for such period, and with such remuneration and subject to such
conditions as the directors may think fit. Any such power of attorney may contain such
provisions for the protection or convenience of persons dealing with such attorney as the
directors think fit. Any such attorney may be authorized by the directors to sub-delegate
all or any of the powers, authorities and discretions for the time being vested in him or
her.
| 17. |
|
INTERESTS
OF DIRECTORS AND OFFICERS |
| 17.1 |
|
Obligation
to Account for Profits |
A director or senior officer who
holds a disclosable interest (as that term is used in the Business Corporations
Act) in a contract or transaction into which the Company has entered or proposes to
enter is liable to account to the Company for any profit that accrues to the director or
senior officer under or as a result of the contract or transaction only if and to the
extent provided in the Business Corporations Act.
| 17.2 |
|
Restrictions
on Voting by Reason of Interest |
A director who holds a disclosable
interest in a contract or transaction into which the Company has entered or proposes to
enter is not entitled to vote on any directors’ resolution to approve that contract
or transaction, unless all the directors have a disclosable interest in that contract or
transaction, in which case any or all of those directors may vote on such resolution.
| 17.3 |
|
Interested
Director Counted in Quorum |
A director who holds a disclosable
interest in a contract or transaction into which the Company has entered or proposes to
enter and who is present at the meeting of directors at which the contract or transaction
is considered for approval may be counted in the quorum at the meeting whether or not the
director votes on any or all of the resolutions considered at the meeting.
| 17.4 |
|
Disclosure
of Conflict of Interest or Property |
A director or senior officer who
holds any office or possesses any property, right or interest that could result, directly
or indirectly, in the creation of a duty or interest that materially conflicts with that
individual’s duty or interest as a director or senior officer, must disclose the
nature and extent of the conflict as required by the Business Corporations Act.
| 17.5 |
|
Director
Holding Other Office in the Company |
A director may hold any office or
place of profit with the Company, other than the office of auditor of the Company, in
addition to his or her office of director for the period and on the terms (as to
remuneration or otherwise) that the directors may determine.
No director or intended director is
disqualified by his or her office from contracting with the Company either with regard to
the holding of any office or place of profit the director holds with the Company or as
vendor, purchaser or otherwise, and no contract or transaction entered into by or on
behalf of the Company in which a director is in any way interested is liable to be voided
for that reason.
| 17.7 |
|
Professional
Services by Director or Officer |
Subject to the Business
Corporations Act, a director or officer, or any person in which a director or officer
has an interest, may act in a professional capacity for the Company, except as auditor of
the Company, and the director or
- 22 -
officer or such person is entitled to
remuneration for professional services as if that director or officer were not a director
or officer.
| 17.8 |
|
Director
or Officer in Other Corporations |
A director or officer may be or
become a director, officer or employee of, or otherwise interested in, any person in which
the Company may be interested as a shareholder or otherwise, and, subject to the
Business Corporations Act, the director or officer is not accountable to the
Company for any remuneration or other benefits received by him or her as director, officer
or employee of, or from his or her interest in, such other person.
| 18. |
|
PROCEEDINGS
OF DIRECTORS |
| 18.1 |
|
Meetings
of Directors |
The directors may meet together for
the conduct of business, adjourn and otherwise regulate their meetings as they think fit,
and meetings of the directors held at regular intervals may be held at the place, at the
time and on the notice, if any, as the directors may from time to time determine.
Questions arising at any meeting of
directors are to be decided by a majority of votes and, in the case of an equality of
votes, the chair of the meeting does not have a second or casting vote.
The following individual is entitled
to preside as chair at a meeting of directors:
| (1) |
|
the
chair of the board, if any; |
| (2) |
|
in
the absence of the chair of the board, the president, if any, if the president
is a director; or |
| (3) |
|
any
other director chosen by the directors if: |
| |
(a) |
|
neither
the chair of the board nor the president, if a director, is present at the
meeting within 15 minutes after the time set for holding the meeting; |
| |
(b) |
|
neither
the chair of the board nor the president, if a director, is willing to chair
the meeting; or |
| |
(c) |
|
the
chair of the board and the president, if a director, have advised the
secretary, if any, or any other director, that they will not be present at the
meeting. |
| 18.4 |
|
Meetings
by Telephone or Other Communications Medium |
A director may participate in a
meeting of the directors or of any committee of the directors:
| (3) |
|
with
the consent of all directors who wish to participate in the meeting, by other
communications medium; |
if all directors participating in the
meeting, whether in person or by telephone or other communications medium, are able to
communicate with each other. A director who participates in a meeting in a manner
contemplated by this
- 23 -
Article 18.4 is deemed for all
purposes of the Business Corporations Act and these Articles to be present at the
meeting and to have agreed to participate in that manner.
A director may, and the secretary or
an assistant secretary of the Company, if any, on the request of a director must, call a
meeting of the directors at any time.
Other than for meetings held at
regular intervals as determined by the directors pursuant to Article 18.1, reasonable
notice of each meeting of the directors, specifying the place, day and time of that
meeting must be given to each of the directors and the alternate directors by any method
set out in Article 24.1 or orally or by telephone.
| 18.7 |
|
When
Notice Not Required |
It is not necessary to give notice of
a meeting of the directors to a director or an alternate director if:
| (1) |
|
the
meeting is to be held immediately following a meeting of shareholders at which
that director was elected or appointed, or is the meeting of the directors at
which that director is appointed; or |
| (2) |
|
the
director or alternate director, as the case may be, has waived notice of the
meeting. |
| 18.8 |
|
Meeting
Valid Despite Failure to Give Notice |
The accidental omission to give
notice of any meeting of directors to, or the non-receipt of any notice by, any director
or alternate director, does not invalidate any proceedings at that meeting.
| 18.9 |
|
Waiver
of Notice of Meetings |
Any director or alternate director
may send to the Company a document signed by him or her waiving notice of any past,
present or future meeting or meetings of the directors and may at any time withdraw that
waiver with respect to meetings held after that withdrawal. After sending a waiver with
respect to all future meetings and until that waiver is withdrawn, no notice of any
meeting of the directors need be given to that director and, unless the director otherwise
requires by notice in writing to the Company, to his or her alternate director, and all
meetings of the directors so held are deemed not to be improperly called or constituted by
reason of notice not having been given to such director or alternate director. Attendance
of a director or alternate director at a meeting of the directors is a waiver of notice of
the meeting unless that director or alternate director attends the meeting for the express
purpose of objecting to the transaction of any business on the grounds that the meeting is
not lawfully called.
The quorum necessary for the
transaction of the business of the directors may be set by the directors and, if not so
set, is deemed to be set at a majority of the directors in office or, if the number of
directors is set at one, is deemed to be set at one director, and that director may
constitute a meeting.
| 18.11 |
|
Validity
of Acts Where Appointment Defective |
Subject to the Business
Corporations Act, an act of a director or officer is not invalid merely because of an
irregularity in the election or appointment or a defect in the qualification of that
director or officer.
| 18.12 |
|
Consent
Resolutions in Writing |
A resolution of the directors or of
any committee of the directors may be passed without a meeting:
- 24 -
| (1) |
|
in
all cases, if each of the directors entitled to vote on the resolution consents
to it in writing; or |
| (2) |
|
in
the case of a resolution to approve a contract or transaction in respect of
which a director has disclosed that he or she has or may have a disclosable
interest, if each of the other directors who have not made such a disclosure
consents in writing to the resolution. |
A consent in writing under this
Article may be by signed document, fax, e-mail or any other method of transmitting legibly
recorded messages. A consent in writing may be in two or more counterparts which together
are deemed to constitute one consent in writing. A resolution of the directors or of any
committee of the directors passed in accordance with this Article 18.12 is effective
on the date stated in the consent in writing or on the latest date stated on any
counterpart and is deemed to be a proceeding at a meeting of directors or of the committee
of the directors and to be as valid and effective as if it had been passed at a meeting of
the directors or of the committee of the directors that satisfies all the requirements of
the Business Corporations Act and all the requirements of these
Articles relating to meetings of the directors or of a committee of the directors.
| 19. |
|
EXECUTIVE
AND OTHER COMMITTEES |
| 19.1 |
|
Appointment
and Powers of Executive Committee |
The directors may, by resolution,
appoint an executive committee consisting of the director or directors that they consider
appropriate, and this committee has, during the intervals between meetings of the board of
directors, all of the directors’ powers, except:
| (1) |
|
the
power to fill vacancies in the board of directors; |
| (2) |
|
the
power to remove a director; |
| (3) |
|
the
power to change the membership of, or fill vacancies in, any committee of the
directors; and |
| (4) |
|
such
other powers, if any, as may be set out in the resolution or any subsequent
directors’ resolution. |
| 19.2 |
|
Appointment
and Powers of Other Committees |
The directors may, by resolution:
| (1) |
|
appoint
one or more committees (other than the executive committee) consisting of the
director or directors that they consider appropriate; |
| (2) |
|
delegate
to a committee appointed under paragraph (1) any of the directors’ powers,
except: |
| |
(a) |
|
the
power to fill vacancies in the board of directors; |
| |
(b) |
|
the
power to remove a director; |
| |
(c) |
|
the
power to change the membership of, or fill vacancies in, any committee of the
directors; and |
| |
(d) |
|
the
power to appoint or remove officers appointed by the directors; and |
| (3) |
|
make
any delegation referred to in paragraph (2) subject to the conditions set
out in the resolution or any subsequent directors’ resolution. |
| 19.3 |
|
Obligations
of Committees |
Any committee appointed under
Articles 19.1 or 19.2, in the exercise of the powers delegated to it, must:
- 25 -
| (1) |
|
conform
to any rules that may from time to time be imposed on it by the directors; and |
| (2) |
|
report
every act or thing done in exercise of those powers at such times as the
directors may require. |
The directors may, at any time, with
respect to a committee appointed under Articles 19.1 or 19.2:
| (1) |
|
revoke
or alter the authority given to the committee, or override a decision made by
the committee, except as to acts done before such revocation, alteration or
overriding; |
| (2) |
|
terminate
the appointment of, or change the membership of, the committee; and |
| (3) |
|
fill
vacancies in the committee. |
Subject to Article 19.3(1) and
unless the directors otherwise provide in the resolution appointing the committee or in
any subsequent resolution, with respect to a committee appointed under Articles 19.1
or 19.2:
| (1) |
|
the
committee may meet and adjourn as it thinks proper; |
| (2) |
|
the
committee may elect a chair of its meetings but, if no chair of a meeting is
elected, or if at a meeting the chair of the meeting is not present within
15 minutes after the time set for holding the meeting, the directors
present who are members of the committee may choose one of their number to
chair the meeting; |
| (3) |
|
a
majority of the members of the committee constitutes a quorum of the committee;
and |
| (4) |
|
questions
arising at any meeting of the committee are determined by a majority of votes
of the members present, and in case of an equality of votes, the chair of the
meeting does not have a second or casting vote. |
| 20.1 |
|
Directors
May Appoint Officers |
The directors may, from time to time,
appoint such officers, if any, as the directors determine and the directors may, at any
time, terminate any such appointment.
| 20.2 |
|
Functions,
Duties and Powers of Officers |
The directors may, for each officer:
| (1) |
|
determine
the functions and duties of the officer; |
| (2) |
|
entrust
to and confer on the officer any of the powers exercisable by the directors on
such terms and conditions and with such restrictions as the directors think
fit; and |
| (3) |
|
revoke,
withdraw, alter or vary all or any of the functions, duties and powers of the
officer. |
No officer may be appointed unless
that officer is qualified in accordance with the Business Corporations Act. One
person may hold more than one position as an officer of the Company. Any person appointed
as the chair of the board or as the managing director must be a director. Any other
officer need not be a director.
- 26 -
| 20.4 |
|
Remuneration
and Terms of Appointment |
All appointments of officers are to
be made on the terms and conditions and at the remuneration (whether by way of salary,
fee, commission, participation in profits or otherwise) that the directors thinks fit and
are subject to termination at the pleasure of the directors, and an officer may in
addition to such remuneration be entitled to receive, after he or she ceases to hold such
office or leaves the employment of the Company, a pension or gratuity.
In this Article 21:
| (1) |
|
“eligible
penalty” means a judgment, penalty or fine awarded or imposed in, or an
amount paid in settlement of, an eligible proceeding; |
| (2) |
|
“eligible
proceeding” means a legal proceeding or investigative action, whether
current, threatened, pending or completed, in which a director, former director
or alternate director of the Company (an “eligible party”) or any of
the heirs and legal personal representatives of the eligible party, by reason
of the eligible party being or having been a director or alternate director of
the Company: |
| |
(a) |
|
is
or may be joined as a party; or |
| |
(b) |
|
is
or may be liable for or in respect of a judgment, penalty or fine in, or
expenses related to, the proceeding; |
| (3) |
|
“expenses” has
the meaning set out in the Business Corporations Act. |
| 21.2 |
|
Mandatory
Indemnification of Eligible Parties |
Subject to the Business
Corporations Act, the Company must indemnify a director, former director or alternate
director of the Company and his or her heirs and legal personal representatives against
all eligible penalties to which such person is or may be liable, and the Company must,
after the final disposition of an eligible proceeding, pay the expenses actually and
reasonably incurred by such person in respect of that proceeding. Each director and
alternate director is deemed to have contracted with the Company on the terms of the
indemnity contained in this Article 21.2.
| 21.3 |
|
Indemnification
of Other Persons |
Subject to any restrictions in the
Business Corporations Act, the Company may indemnify any person.
| 21.4 |
|
Non-Compliance
with Business Corporations Act |
The failure of a director, alternate
director or officer of the Company to comply with the Business Corporations Act or
these Articles or, if applicable, any former Companies Act or former Articles, does
not invalidate any indemnity to which he or she is entitled under this Part.
| 21.5 |
|
Company
May Purchase Insurance |
The Company may purchase and maintain
insurance for the benefit of any person (or his or her heirs or legal personal
representatives) who:
| |
(1) |
|
is
or was a director, alternate director, officer, employee or agent of the
Company; |
- 27 -
| (2) |
|
is
or was a director, alternate director, officer, employee or agent of a
corporation at a time when the corporation is or was an affiliate of the
Company; |
| (3) |
|
at
the request of the Company, is or was a director, alternate director, officer,
employee or agent of a corporation or of a partnership, trust, joint venture or
other unincorporated entity; |
| (4) |
|
at
the request of the Company, holds or held a position equivalent to that of a
director, alternate director or officer of a partnership, trust, joint venture
or other unincorporated entity; |
against any liability incurred by him
or her as such director, alternate director, officer, employee or agent or person who
holds or held such equivalent position.
| 22.1 |
|
Payment
of Dividends Subject to Special Rights |
The provisions of this
Article 22 are subject to the rights, if any, of shareholders holding shares with
special rights as to dividends.
| 22.2 |
|
Declaration
of Dividends |
Subject to the Business
Corporations Act, the directors may from time to time declare and authorize payment of
such dividends as they may deem advisable.
The directors need not give notice to
any shareholder of any declaration under Article 22.2.
The directors may set a date as the
record date for the purpose of determining shareholders entitled to receive payment of a
dividend. The record date must not precede the date on which the dividend is to be paid by
more than two months. If no record date is set, the record date is 5 p.m. on the date
on which the directors pass the resolution declaring the dividend.
| 22.5 |
|
Manner
of Paying Dividends |
A resolution declaring a dividend may
direct payment of the dividend wholly or partly in money or by the distribution of
specific assets or of fully paid shares or of bonds, debentures or other securities of the
Company or any other corporation, or in any one or more of those ways.
| 22.6 |
|
Settlement
of Difficulties |
If any difficulty arises in regard to
a distribution under Article 22.5, the directors may settle the difficulty as they
deem advisable, and, in particular, may:
| (1) |
|
set
the value for distribution of specific assets; |
| (2) |
|
determine
that money in substitution for all or any part of the specific assets to which
any shareholders are entitled may be paid to any shareholders on the basis of
the value so fixed in order to adjust the rights of all parties; and |
| (3) |
|
vest
any such specific assets in trustees for the persons entitled to the dividend. |
- 28 -
| 22.7 |
|
When
Dividend Payable |
Any dividend may be made payable on
such date as is fixed by the directors.
| 22.8 |
|
Dividends
to be Paid in Accordance with Number of Shares |
All dividends on shares of any class
or series of shares must be declared and paid according to the number of such shares held.
| 22.9 |
|
Receipt
by Joint Shareholders |
If several persons are joint
shareholders of any share, any one of them may give an effective receipt for any dividend,
bonus or other money payable in respect of the share.
| 22.10 |
|
Dividend
Bears No Interest |
No dividend bears interest against
the Company.
| 22.11 |
|
Fractional
Dividends |
If a dividend to which a shareholder
is entitled includes a fraction of the smallest monetary unit of the currency of the
dividend, that fraction may be disregarded in making payment of the dividend and that
payment represents full payment of the dividend.
| 22.12 |
|
Payment
of Dividends |
Any dividend or other distribution
payable in money in respect of shares may be paid by cheque, made payable to the order of
the person to whom it is sent, and mailed to the registered address of the shareholder, or
in the case of joint shareholders, to the registered address of the joint shareholder who
is first named on the central securities register, or to the person and to the address the
shareholder or joint shareholders may direct in writing. The mailing of such cheque will,
to the extent of the sum represented by the cheque (plus the amount of the tax required by
law to be deducted), discharge all liability for the dividend unless such cheque is not
paid on presentation or the amount of tax so deducted is not paid to the appropriate
taxing authority.
| 22.13 |
|
Capitalization
of Retained Earnings or Surplus |
Notwithstanding anything contained in
these Articles, the directors may from time to time capitalize any retained earnings or
surplus of the Company and may from time to time issue, as fully paid, shares or any
bonds, debentures or other securities of the Company as a dividend representing the
retained earnings or surplus so capitalized or any part thereof.
| 23. |
|
ACCOUNTING
RECORDS AND AUDITORS |
| 23.1 |
|
Recording
of Financial Affairs |
The directors must cause adequate
accounting records to be kept to record properly the financial affairs and condition of
the Company and to comply with the Business Corporations Act.
| 23.2 |
|
Inspection
of Accounting Records |
Unless the directors determine
otherwise, or unless otherwise determined by ordinary resolution, no shareholder of the
Company is entitled to inspect or obtain a copy of any accounting records of the Company.
- 29 -
| 23.3 |
|
Remuneration
of Auditor |
The directors may set the
remuneration of the auditor of the Company.
| 24.1 |
|
Method
of Giving Notice |
Unless the Business Corporations
Act or these Articles provides otherwise, a notice, statement, report or other record
required or permitted by the Business Corporations Act or these Articles to be sent
by or to a person may be sent by any one of the following methods:
| (1) |
|
mail
addressed to the person at the applicable address for that person as follows: |
| |
(a) |
|
for
a record mailed to a shareholder, the shareholder’s registered address; |
| |
(b) |
|
for
a record mailed to a director or officer, the prescribed address for mailing
shown for the director or officer in the records kept by the Company or the
mailing address provided by the recipient for the sending of that record or
records of that class; |
| |
(c) |
|
in
any other case, the mailing address of the intended recipient; |
| (2) |
|
delivery
at the applicable address for that person as follows, addressed to the person: |
| |
(a) |
|
for
a record delivered to a shareholder, the shareholder’s registered address; |
| |
(b) |
|
for
a record delivered to a director or officer, the prescribed address for
delivery shown for the director or officer in the records kept by the Company
or the delivery address provided by the recipient for the sending of that
record or records of that class; |
| |
(c) |
|
in
any other case, the delivery address of the intended recipient; |
| (3) |
|
sending
the record by fax to the fax number provided by the intended recipient for the
sending of that record or records of that class; |
| (4) |
|
sending
the record by e-mail to the e-mail address provided by the intended recipient
for the sending of that record or records of that class; |
| (5) |
|
physical
delivery to the intended recipient; or |
| (6) |
|
as
otherwise permitted by any securities legislation in any province or territory
of Canada or in the federal jurisdiction of the United States or in any states
of the United States that is applicable to the Company and all regulations and
rules made and promulgated under that legislation and all administrative policy
statements, blanket orders and rulings, notices and other administrative
directions issued by securities commissions or similar authorities appointed
under that legislation. |
A notice, statement, report or other
record that is:
| (1) |
|
mailed
to a person by ordinary mail to the applicable address for that person referred
to in Article 24.1 is deemed to be received by the person to whom it was
mailed on the day (Saturdays, Sundays and holidays excepted) following the date
of mailing; |
- 30 -
| (2) |
|
faxed
to a person to the fax number provided by that person referred to in Article 24.1
is deemed to be received by the person to whom it was faxed on the day it was
faxed; and |
| (3) |
|
e-mailed
to a person to the e-mail address provided by that person referred to in Article 24.1
is deemed to be received by the person to whom it was e-mailed on the day it
was e-mailed. |
| 24.3 |
|
Certificate
of Sending |
A certificate signed by the
secretary, if any, or other officer of the Company or of any other corporation acting in
that capacity on behalf of the Company stating that a notice, statement, report or other
record was sent in accordance with Article 24.1 is conclusive evidence of that fact.
| 24.4 |
|
Notice
to Joint Shareholders |
A notice, statement, report or other
record may be provided by the Company to the joint shareholders of a share by providing
such record to the joint shareholder first named in the central securities register in
respect of the share.
| |
24.5 |
|
Notice
to Legal Personal Representatives and Trustees |
A notice, statement, report or other
record may be provided by the Company to the persons entitled to a share in consequence of
the death, bankruptcy or incapacity of a shareholder by:
| (1) |
|
mailing
the record, addressed to them: |
| |
(a) |
|
by
name, by the title of the legal personal representative of the deceased or
incapacitated shareholder, by the title of trustee of the bankrupt shareholder
or by any similar description; and |
| |
(b) |
|
at
the address, if any, supplied to the Company for that purpose by the persons
claiming to be so entitled; or |
| (2) |
|
if
an address referred to in paragraph (1)(b) has not been supplied to the
Company, by giving the notice in a manner in which it might have been given if
the death, bankruptcy or incapacity had not occurred. |
If on two consecutive occasions, a
notice, statement, report or other record is sent to a shareholder pursuant to
Article 24.1 and on each of those occasions any such record is returned because the
shareholder cannot be located, the Company shall not be required to send any further
records to the shareholder until the shareholder informs the Company in writing of his or
her new address.
Except as provided in
Articles 25.2 and 25.3, the Company’s seal, if any, must not be impressed on any
record except when that impression is attested by the signatures of:
| (2) |
|
any
officer, together with any director; |
| (3) |
|
if
the Company only has one director, that director; or |
| (4) |
|
any
one or more directors or officers or persons as may be determined by the
directors. |
- 31 -
For the purpose of certifying under
seal a certificate of incumbency of the directors or officers of the Company or a true
copy of any resolution or other document, despite Article 25.1, the impression of the
seal may be attested by the signature of any director or officer or the signature of any
other person as may be determined by the directors.
| 25.3 |
|
Mechanical
Reproduction of Seal |
The directors may authorize the seal
to be impressed by third parties on share certificates or bonds, debentures or other
securities of the Company as they may determine appropriate from time to time. To enable
the seal to be impressed on any share certificates or bonds, debentures or other
securities of the Company, whether in definitive or interim form, on which facsimiles of
any of the signatures of the directors or officers of the Company are, in accordance with
the Business Corporations Act or these Articles, printed or otherwise mechanically
reproduced, there may be delivered to the person employed to engrave, lithograph or print
such definitive or interim share certificates or bonds, debentures or other securities one
or more unmounted dies reproducing the seal and such persons as are authorized under
Article 25.1 to attest the Company’s seal may in writing authorize such person
to cause the seal to be impressed on such definitive or interim share certificates or
bonds, debentures or other securities by the use of such dies. Share certificates or
bonds, debentures or other securities to which the seal has been so impressed are for all
purposes deemed to be under and to bear the seal impressed on them.