As filed with the Securities and Exchange Commission on
March 9, 2018
|
Registration Statement No. 333-
|
|
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
FORM F-10
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
|
ENDEAVOUR SILVER CORP.
(Exact name of Registrant as specified in its charter)
British Columbia
|
1040
|
Not Applicable
|
(Province or other jurisdiction of
|
(Primary Standard Industrial
|
(I.R.S. Employer Identification No.)
|
incorporation or organization )
|
Classification Code Number)
|
|
1130-609 Granville Street
Vancouver, British Columbia
Canada V7Y 1G5
(604) 685-9775
(Address and telephone
number of Registrants principal executive offices)
DL Services Inc.
Columbia Center, 701 Fifth
Avenue, Suite 1600
Seattle, Washington 98104
(206)
903-5448
(Name, address (including zip code) and telephone number
(including area code) of agent for service in the United States)
Copies to:
|
Kenneth G. Sam, Esq.
|
Bernard G. Poznanski
|
Jason K. Brenkert, Esq.
|
D. Wendy Lee
|
Dorsey & Whitney LLP
|
Koffman Kalef LLP
|
1400 Wewatta Street, Suite 400
|
19
th
Floor, 885 West Georgia
Street
|
Denver, CO 80202-5549
|
Vancouver, British Columbia
|
(303) 629-3400
|
Canada, V6C 3H4
|
|
(604)-891-3688
|
Approximate date of commencement of proposed sale of the
securities to the public
:
From time to time after the effective date of
this registration statement.
Province of British Columbia, Canada
(Principal jurisdiction regulating this offering)
It is proposed that this filing shall become effective (check
appropriate box):
A.
|
[ ]
|
Upon filing with the Commission, pursuant to Rule 467(a)
(if in connection with an offering being made contemporaneously in the
United States and Canada).
|
|
|
|
B.
|
[X]
|
At some future date (check the appropriate box
below):
|
|
1.
|
[ ]
|
pursuant to Rule 467(b) on __(date) at___(time)
(designate a time not sooner than 7 calendar days after filing).
|
|
|
|
|
|
2.
|
[ ]
|
pursuant to Rule 467(b) on __(date) at ___(time)
(designate a time 7 calendar days or sooner after filing) because the
securities regulatory authority in the review jurisdiction has issued a
receipt or notification of clearance on ___(date).
|
|
|
|
|
|
3.
|
[ ]
|
pursuant to Rule 467(b) as soon as practicable after
notification of the Commission by the Registrant or the Canadian
securities regulatory authority of the review jurisdiction that a receipt
or notification of clearance has been issued with respect hereto.
|
|
|
|
|
|
4.
|
[X]
|
after the filing of the next amendment to this Form (if
preliminary material is being filed).
|
If any of the securities being registered on this Form are to
be offered on a delayed or continuous basis pursuant to the home jurisdictions
shelf prospectus offering procedures, check the following box. [X]
CALCULATION OF REGISTRATION FEE
|
|
|
Title of each class of
|
Proposed maximum
|
Amount of
|
securities to be registered
|
aggregate offering price
(1)
(2)
|
registration fee
|
_______________________
|
_______________________
|
_______________________
|
|
|
|
|
|
|
Common Shares, Warrants to Purchase
|
|
|
Common Shares, Subscription
|
$116,040,000
|
$14,446.98
|
Receipts, Debt Securities
(3)
|
|
|
|
|
|
_______________________
|
_______________________
|
_______________________
|
TOTAL
|
$116,040,000
|
$14,446.98
(4)
|
(1)
|
Rule 457(o) permits the registration fee to be calculated
on the basis of the maximum offering price of all of the securities listed
and, therefore, the table does not specify by each class information as to
the amount to be registered or the proposed maximum offer price per
security. The proposed maximum initial offering price per security will be
determined, from time to time, by the Registrant. In no event will the
aggregate initial offering price of all securities issued from time to
time pursuant to this Registration Statement exceed
$116,040,000.
|
|
|
(2)
|
Determined based on the proposed maximum aggregate offering price in Canadian dollars of $150,000,000 converted into U.S. dollars based on the average rate of exchange on March 8, 2018, as report by the Bank of Canada, for the conversion of Canadian dollars into U.S. dollars of Cdn$1.00 equals U.S.$0.7736.
|
|
|
(3)
|
Subject to footnote (1), there are being registered
hereunder an indeterminate number of Common Shares, Warrants to Purchase
Common Shares or Subscription Receipts or Debt Securities, Subscription
Receipts which entitle the holder to receive upon satisfaction of certain
release conditions, for no additional consideration, Common Shares,
Warrants or any combination thereof, Debt Securities, or Units consisting
of two or more of the foregoing or any combination thereof, as may be sold
from time to time by the Registrant. There are also being registered
hereunder an indeterminate number of Common Shares as may be issuable upon
exercise of Warrants to Purchase Common Shares or as part of Subscription
Receipts or Units and such indeterminate number of Common Shares as may be
issuable pursuant to anti-dilution or other similar adjustment provisions
in the Warrants or Subscription Receipts.
|
|
|
(4)
|
The Registrant previously paid a registration fee of
$23,737.56 in connection with its registration of $184,297,825.30 in
maximum aggregate offering price of securities on its registration
statement on Form F-10 (File No. 333-196981) initially filed on June 24,
2014 and declared effective on August 4, 2014 (Prior Registration
Statement) of which the Registrant offered and sold securities in the
amount of $16,500,000, leaving $167,797,825.30 in maximum aggregate
offering amount of securities and a remaining registration fee of
$21,612.35. Pursuant to Rule 457(p) under the Securities Act, the
Registrant previously offset $13,865.38 of the available filing fee of
$21,612.35 in connection with the filing of a Registration Statement on
Form F-10 (File No. 333-210911), leaving $7,747 of the prior registration
fee available for offset. Pursuant to Rule 457(p) under the Securities
Act, the Registrant is offsetting the $14,446.98 filing fee in connection
with this Registration Statement with the available $7,747 remaining from
Prior Registration Statement, leaving $6,699.98 to be paid in connection
with this filing, which is being paid concurrently with this
filing.
|
The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective date until the
registration statement shall become effective as provided in Rule 467 under the
Securities Act, or on such date as the Commission, acting pursuant to Section
8(a) of the Securities Act, may determine.
PART I
INFORMATION REQUIRED TO BE DELIVERED TO OFFEREES OR
PURCHASERS
Information contained herein is
subject to completion or amendment. A registration statement relating to these
securities has been filed with the United States Securities and Exchange
Commission. These securities may not be sold nor may offers to buy be accepted
prior to the time the registration statement becomes effective. This prospectus
shall not constitute an offer to sell or the solicitation of an offer to buy,
nor shall there be any sale of the securities in any state in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such state.
SUBJECT TO COMPLETION, DATED MARCH 9,
2018
Prospectus Dated , 2018
ENDEAVOUR SILVER CORP.
$150,000,000
Common Shares
Warrants
Subscription Receipts
Debt Securities
Units
Endeavour Silver Corp. (the
Company
or
Endeavour
) may offer and issue from time to time common shares (the
Common Shares
), warrants (the
Warrants
) to purchase Common
Shares or other Securities (as defined below), subscription receipts
(
Subscription Receipts
) which entitle the holder to receive upon
satisfaction of certain release conditions, and for no additional consideration,
Common Shares or Warrants of the Company or any combination thereof, debt
securities (
Debt Securities
), or units (
Units
) consisting of
two or more of the foregoing (all of the foregoing, collectively, the
Securities
) or any combination thereof up to an aggregate initial
offering price of $150,000,000 (or its equivalent in any other currency used
to denominate the Securities at the time of the offering) during the 25-month
period that this short form base shelf prospectus (the
Prospectus
),
including any amendments thereto, remains effective. Securities may be offered
separately or together, in amounts, at prices and on terms to be determined
based on market conditions at the time of sale and set forth in an accompanying
shelf prospectus supplement (a
Prospectus Supplement
). In addition,
Securities may be offered and issued in consideration for the acquisition of
other businesses, assets or securities by the Company or a subsidiary of the
Company. The consideration for any such acquisition may consist of any of the
Securities separately, a combination of Securities or any combination of, among
other things, Securities, cash and assumption of liabilities.
Investing in securities of the Company involves a high
degree of risk. You should carefully review the risks outlined in this
Prospectus and in the documents incorporated by reference in this Prospectus and
consider such risks in connection with an investment in such securities. See
Risk Factors.
This offering is made by a Canadian issuer that is
permitted, under a multijurisdictional disclosure system adopted by the United
States and Canada (MJDS), to prepare this Prospectus in accordance with
Canadian disclosure requirements. Prospective investors in the United States
should be aware that such requirements are different from those of the United
States. Financial statements included or incorporated by reference herein have
been prepared in accordance with International Financial Reporting Standards
(IFRS) as issued by the International Accounting Standards Board (IASB) and
may not be comparable to financial statements of United States companies. Such
financial statements are subject to Canadian generally accepted auditing
standards and auditor independence standards, in addition to the standards of
the Public Company Accounting Oversight Board (United States) and the United
States Securities and Exchange Commission (SEC) independence standards.
Prospective investors should be aware that the acquisition
of the securities described herein may have tax consequences both in the United
States and in Canada. Such consequences for investors who are resident in, or
citizens of, the United States may not be described fully
herein. Prospective investors should read the tax discussion contained in the
applicable Prospectus Supplement with respect to a particular offering of
Securities.
The enforcement by investors of civil liabilities under the
United States federal securities laws may be affected adversely by the fact that
the Company is incorporated under the laws of British Columbia, Canada, that the
majority of its officers and directors are residents of Canada, that all of the
experts named in the registration statement are not residents of the United
States, and that a substantial portion of the assets of the Company and said
persons are located outside the United States.
NEITHER THE SEC NOR ANY STATE OR CANADIAN SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THE SECURITIES OFFERED HEREBY OR
DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENCE.
The specific terms of the Securities with respect to a
particular offering will be set out in the applicable Prospectus Supplement and
may include, where applicable: (i) in the case of Common Shares, the number of
Common Shares offered, the issue price, and any other terms specific to the
Common Shares being offered; (ii) in the case of Warrants, the designation,
number and terms of the Common Shares or other Securities issuable upon exercise
of the Warrants, any procedures that will result in the adjustment of these
numbers, the exercise price, dates and periods of exercise, the currency in
which the Warrants are issued and any other specific terms; (iii) in the case of
Subscription Receipts, the designation, number and terms of the Common Shares or
Warrants receivable upon satisfaction of certain release conditions, any
procedures that will result in the adjustment of those numbers, any additional
payments to be made to holders of Subscription Receipts upon satisfaction of the
release conditions, the terms of the release conditions, terms governing the
escrow of all or a portion of the gross proceeds from the sale of the
Subscription Receipts, terms for the refund of all or a portion of the purchase
price for Subscription Receipts in the event the release conditions are not met
and any other specific terms, (iv) in the case of Debt Securities, the specific
designation, the aggregate principal amount, the currency or the currency unit
for which the Debt Securities may be purchased, the maturity, the interest
provisions, the authorized denominations, the offering price, whether the Debt
Securities are being offered for cash, the covenants, the events of default, any
terms for redemption or retraction, any exchange or conversion rights attached
to the Debt Securities, whether the debt is senior or subordinated to the
Companys other liabilities and obligations, whether the Debt Securities will be
secured by any of the Companys assets or guaranteed by any other person and any
other terms specific to the Debt Securities being offered; and (v) in the case
of Units, the terms of the component Securities and any other specific terms. A
Prospectus Supplement may include specific variable terms pertaining to the
Securities that are not within the alternatives and parameters described in this
Prospectus. Where required by statute, regulation or policy, and where
Securities are offered in currencies other than Canadian dollars, appropriate
disclosure of foreign exchange rates applicable to such Securities will be
included in the Prospectus Supplement describing such Securities.
Warrants will not be offered for sale separately to any member
of the public in Canada unless the offering is in connection with, and forms
part of, the consideration for an acquisition or merger transaction.
This Prospectus does not qualify for issuance Debt Securities
in respect of which the payment of principal and/or interest may be determined,
in whole or in part, by reference to one or more underlying interests,
including, for example, an equity or debt security, or a statistical measure of
economic or financial performance (including, but not limited to, any currency,
consumer price or mortgage index, or the price or value of one or more
commodities, indices or other items, or any other item or formula, or any
combination or basket of the foregoing items). For greater certainty, this
Prospectus may qualify for issuance Debt Securities in respect of which the
payment of principal and/or interest may be determined, in whole or in part, by
reference to published rates of a central banking authority or one or more
financial institutions, such as a prime rate or bankers acceptance rate, or to
recognized market benchmark interest rates such as LIBOR, EURIBOR or a United
States federal funds rate.
All information permitted under applicable laws to be omitted
from this Prospectus will be contained in one or more Prospectus Supplements
that will be delivered to purchasers together with this Prospectus, such
delivery to be effected in the case of United States purchasers through the
filing of such Prospectus Supplement or Prospectus Supplements with the SEC.
Each Prospectus Supplement will be incorporated by reference into this
Prospectus for the purposes of securities legislation as of the date of the
Prospectus Supplement and only for the purposes of the distribution of the
Securities to which the Prospectus Supplement pertains.
2
This Prospectus constitutes a public offering of these
Securities only in those jurisdictions where they may be lawfully offered for
sale and therein only by persons permitted to sell such Securities. The Company
may offer and sell Securities to or through underwriters or dealers and also may
offer and sell certain Securities directly to purchasers or through agents
pursuant to exemptions from registration or qualification under applicable
securities laws. A Prospectus Supplement relating to each issue of Securities
offered thereby will set forth the names of any underwriters, dealers or agents
involved in the offering and sale of such Securities and will set forth the
terms of the offering of such Securities, the method of distribution of such
Securities including, to the extent applicable, the proceeds to the Company and
any fees, discounts or any other compensation payable to underwriters, dealers
or agents and any other material terms of the plan of distribution.
The outstanding Common Shares of the Company are listed for
trading on Toronto Stock Exchange (
TSX
) under the symbol EDR and on
NYSE (
NYSE
) under the symbol EXK. Unless otherwise specified in the
applicable Prospectus Supplement, Securities other than the Common Shares of the
Company will not be listed on any securities exchange. On March 8, 2018, the
closing price of the Common Shares on TSX was $3.07 per share and the closing
price of the Common Shares on NYSE was U.S.$2.40 per share.
There is
currently no market through which Securities, other than the Common Shares, may
be sold and purchasers may not be able to resell such Securities purchased under
this Prospectus. This may affect the pricing of the Securities, other than the
Common Shares, in the secondary market, the transparency and availability of
trading prices, the liquidity of these Securities and the extent of issuer
regulation. See Risk Factors.
The offering of Securities hereunder is subject to approval of
certain legal matters on behalf of the Company by Koffman Kalef LLP, with
respect to Canadian legal matters, and Dorsey & Whitney LLP, with respect to
United States legal matters.
In connection with any offering of Securities (unless otherwise
specified in a Prospectus Supplement), other than an at-the-market
distribution, the underwriters may over-allot or effect transactions which
stabilize or maintain the market price of the Securities offered at a level
above that which might otherwise prevail in the open market. Such transactions,
if commenced, may be discontinued at any time. See Plan of Distribution.
The earnings coverage ratio calculated for the 12 months
ended December 31, 2017 was 19.3 to 1. See Earnings Coverage Ratios for more
information.
As of December 31, 2017, the Company has no debt
obligations.
The Companys head office is located at 1130-609 Granville
Street, Vancouver, British Columbia V7Y 1G5 and its registered office is located
at 19th Floor, 885 West Georgia Street, Vancouver, British Columbia V6C 3H4.
No underwriter has been involved in the preparation of this
Prospectus or performed any review of the contents of this Prospectus.
Geoffrey A. Handley, Mario Szotlender and Ricardo M. Campoy,
being directors of the Company reside outside Canada. Although these persons
have appointed the Company, at 1130-609 Granville Street, Vancouver, British
Columbia V7Y 1G5, as their agents for service of process in Canada, it may not
be possible for investors to enforce judgments obtained in Canada against any of
them.
3
TABLE OF CONTENTS
_____________________________
You should rely only on the information contained in or
incorporated by reference into this Prospectus or contained in any applicable
Prospectus Supplement. The Company has not authorized anyone to provide you with
different information. The Company is not making an offer of these Securities in
any jurisdiction where the offer is not permitted. You should not assume that
the information contained in this Prospectus and any Prospectus Supplement is
accurate as of any date other than the date on the front of those documents or
that any information contained in any document incorporated by reference is
accurate as of any date other than the date of that document.
Unless the context otherwise requires, references in this
Prospectus and any Prospectus Supplement to we, our, us, Endeavour or
the Company refer to Endeavour Silver Corp. and each of its material
subsidiaries.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus and the documents incorporated by reference
herein contain forward-looking statements within the meaning of applicable
Canadian securities laws and forward-looking statements within the meaning of
the United States Private Securities Litigation Reform Act of 1995. Such
forward-looking statements concern the Companys anticipated results and
developments in the Companys operations in future periods, planned exploration
and development of its properties, plans related to its business and other
matters that may occur in the future. These statements relate to analyses and
other information that are based on forecasts of future results, estimates of
amounts not yet determinable and assumptions of management.
4
Statements concerning reserves and mineral resource estimates
may also be deemed to constitute forward-looking statements to the extent that
they involve estimates of the mineralization that will be encountered if the
property is developed and, in the case of mineral reserves, such statements
reflect the conclusion based on certain assumptions that the mineral deposit can
be economically exploited. Any statements that express or involve discussions
with respect to predictions, expectations, beliefs, plans, projections,
objectives, assumptions or future events or performance are not statements of
historical fact and may be forward-looking statements. Forward-looking
statements are subject to a variety of known and unknown risks, uncertainties
and other factors which could cause actual events or results to differ from
those expressed or implied by the forward-looking statements, including, without
limitation:
|
risks relating to precious and base metal price
fluctuations;
|
|
risks relating to fluctuations in the currency markets
(particularly the Mexican peso, Canadian dollar and United States dollar);
|
|
risks relating to the inherently dangerous activity of
mining, including conditions or events beyond our control, and operating
or technical difficulties in mineral exploration, development and mining
activities;
|
|
uncertainty in our ability to fund the development of our
mineral properties or the completion of further exploration programs;
|
|
uncertainty as to actual capital costs, operating costs,
production and economic returns, and uncertainty that our development
activities will result in profitable mining operations;
|
|
risks relating to our reserves and mineral resource
figures being estimates based on interpretations and assumptions which may
result in less mineral production under actual conditions than is
currently estimated and to diminishing quantities or grades of mineral
reserves as properties are mined;
|
|
risks relating to changes in governmental regulations,
tax and labour laws and obtaining necessary licenses and permits;
|
|
risks relating to our business being subject to
environmental laws and regulations which may increase our costs of doing
business and restrict our operations;
|
|
risks relating to our mineral properties being subject to
prior unregistered agreements, transfers, or claims and other defects in
title;
|
|
risks relating to inadequate insurance or inability to
obtain insurance;
|
|
risks relating to our ability to successfully integrate
acquisitions;
|
|
uncertainty in our ability to obtain necessary financing;
|
|
risks relating to increased competition that could
adversely affect our ability to attract necessary capital funding or
acquire suitable producing properties for mineral exploration in the
future;
|
|
risks relating to many of our primary properties being
located in Mexico, including political, economic, and regulatory
instability;
|
|
risks relating to our officers and directors becoming
associated with other natural resource companies which may give rise to
conflicts of interests;
|
|
uncertainties relating to our status as a foreign issuer
under United States federal securities laws;
|
|
risks relating to financial instruments; and
|
|
risks relating to our securities.
|
This list is not exhaustive of the factors that may affect the
Companys forward-looking statements. Should one or more of these risks and
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in the forward-looking
statements due to a variety of risk, uncertainties and other factors, including,
without limitation, those referred to in this Prospectus and any Prospectus
Supplement under Risk Factors and elsewhere in this Prospectus and any
Prospectus Supplement and in the documents incorporated by reference herein. The
Companys forward-looking statements are based on beliefs, expectations and
opinions of management on the date the statements are made and the Company does
not assume any obligation to update forward-looking statements if circumstances
or managements beliefs, expectations or opinions change, except as required by
applicable law. For the reasons set forth above, investors should not place
undue reliance on forward-looking statements.
5
CAUTIONARY NOTES TO UNITED STATES INVESTORS CONCERNING
MINERAL
RESERVE AND RESOURCE ESTIMATES
This Prospectus and the documents incorporated by reference
herein have been prepared in accordance with the requirements of Canadian
provincial securities laws, which differ from the requirements of U.S.
securities laws. Unless otherwise indicated, all reserve and resource estimates
included or incorporated by reference in this Prospectus have been prepared in
accordance with Canadian National Instrument 43-101Standards of Disclosure for
Mineral Projects (
NI 43-101
) and the Canadian Institute of Mining,
Metallurgy and Petroleum (the
CIM
)CIM Definition Standards on Mineral
Resources and Mineral Reserves, adopted by the CIM Council, as amended. NI
43-101 is an instrument developed by the Canadian Securities Administrators that
establishes standards for all public disclosure an issuer makes of scientific
and technical information concerning mineral projects. The terms mineral
reserve, proven mineral reserve and probable mineral reserve are Canadian
mining terms as defined in accordance with NI 43-101and CIM standards. These
definitions differ from the definitions in the SECs Industry Guide 7 under the
United States Securities Act of 1933, as amended (the
U.S. Securities
Act
).
Under United States standards, mineralization may not be
classified as a reserve unless the determination has been made that the
mineralization could be economically and legally produced or extracted at the
time the reserve determination is made. Under SEC Industry Guide 7 standards, a
final or bankable feasibility study is required to report reserves, the
three-year historical average price is used in any reserve or cash flow analysis
to designate reserves and the primary environmental analysis or report must be
filed with the appropriate governmental authority.
In addition, the terms mineral resource, measured mineral
resource, indicated mineral resource and inferred mineral resource are
defined in and required to be disclosed by NI 43-101; however, these terms are
not defined terms under SEC Industry Guide 7 and are normally not permitted to
be used in reports and registration statements filed with the SEC. Investors are
cautioned not to assume that any part or all of mineral deposits in these
categories will ever be converted into reserves. Inferred mineral resources
have a great amount of uncertainty as to their existence, and great uncertainty
as to their economic and legal feasibility. It cannot be assumed that all or any
part of an inferred mineral resource will ever be upgraded to a higher category.
Under Canadian rules, estimates of inferred mineral resources may not form the
basis of feasibility or pre-feasibility studies, except in rare cases. Investors
are cautioned not to assume that all or any part of an inferred mineral resource
exists or is economically or legally mineable. Disclosure of contained ounces
in a resource is permitted disclosure under Canadian regulations; however, the
SEC normally only permits issuers to report mineralization that does not
constitute reserves by SEC Industry Guide 7 standards as in place tonnage and
grade without reference to unit measures.
Accordingly, information contained in this Prospectus and the
documents incorporated by reference herein contain descriptions of the Companys
mineral deposits that may not be comparable to similar information made public
by United States companies subject to the reporting and disclosure requirements
under the United States federal securities laws and the rules and regulations
thereunder.
CURRENCY PRESENTATION AND EXCHANGE RATE INFORMATION
Unless stated otherwise or as the context otherwise
requires, all references to dollar amounts in this Prospectus and any Prospectus
Supplement are references to Canadian dollars. References to $ or Cdn.$ are
to Canadian dollars and references to U.S. dollars or U.S.$ are to United
States dollars.
Except as otherwise noted in the Companys AIF (as defined
under Documents Incorporated by Reference) and the Companys financial
statements and related managements discussion and analysis of financial
condition and results of operations of the Company that are incorporated by
reference into this Prospectus (see Documents Incorporated by Reference), the
financial information contained in such documents is expressed in United States
dollars.
The high, low, average and closing noon rates for the United
States dollar in terms of Canadian dollars for each of the financial periods of
the Company ended December 31, 2017, December 31, 2016 and December 31, 2015, as
quoted by the Bank of Canada, were as follows:
6
|
Year ended
|
|
Year ended
|
|
Year ended
|
|
December 31, 2017
|
|
December 31, 2016
|
|
December 31, 2015
|
|
|
|
|
|
|
High
|
1.3743
|
|
1.4589
|
|
1.3990
|
Low
|
1.2128
|
|
1.2544
|
|
1.1728
|
Average
|
1.2986
|
|
1.3248
|
|
1.2787
|
Closing
|
1.2545
|
|
1.3427
|
|
1.3840
|
On March 8, 2018, the exchange rate for the United States
dollar in terms of Canadian dollars, as quoted by the Bank of Canada, was
U.S.$1.00 = Cdn.$1.2927 (Cdn.$1.00 = U.S.$0.7736) .
THE COMPANY
The Company is a Canadian mineral company engaged in the
evaluation, acquisition, exploration, development and exploitation of precious
metal properties in Mexico and Chile. The Company has three producing
silver-gold mines in Mexico: the Guanacevi Mine in Durango acquired in 2004, the
Bolañitos Mine in Guanajuato acquired in 2007 and the El Cubo Mine in Guanajuato
acquired in 2012. In addition to operating these three mines, the Company is
advancing three exploration and development projects in Mexico: the Terronera
property in Jalisco acquired in 2010 that is now in the pre-feasibility stage,
the permitted El Compas property and La Plata plant in Zacatecas acquired in
2016, and the prospective Parral properties in Chihuahua acquired in 2016.
Further information regarding the business of the Company, its
operations and its mineral properties can be found in the Companys AIF and the
materials incorporated by reference into this Prospectus. See Documents
Incorporated by Reference.
USE OF PROCEEDS
Unless otherwise specified in a Prospectus Supplement, the net
proceeds from the sale of the Securities will be used for general corporate
purposes, including, without limitation, the following anticipated purposes:
|
to fund the development of the Terronera
project ;
|
|
|
|
to assess potential development stage mineral
properties for acquisition;
|
|
|
|
to fund the potential acquisition of other
development stage mineral properties; and
|
|
|
|
for continued exploration on the Companys
various existing mineral properties.
|
Each Prospectus Supplement will contain specific information
concerning the use of proceeds from that sale of Securities.
All expenses relating to an offering of Securities and any
compensation paid to underwriters, dealers or agents, as the case may be, will
be paid out of the Companys general funds, unless otherwise stated in the
applicable Prospectus Supplement.
CONSOLIDATED CAPITALIZATION
There has been no material change in the share and loan capital
of the Company, on a consolidated basis, since the date of the audited
consolidated annual financial statements of the Company as at and for the year
ended December 31, 2017, which are incorporated by reference in this Prospectus.
7
EARNINGS COVERAGE RATIOS
The following consolidated earnings coverage ratio has been
calculated for the year ended December 31, 2017 and gives effect to all
long-term financial liabilities and current portions thereof of the Company and
the repayment, redemption or retirement thereof since such dates. The earnings
coverage ratio set forth below does not purport to be indicative of earnings
coverage ratios for any future periods. The earnings coverage ratio and the
interest requirements do not give effect to the issuance of any Debt Securities
that may be issued pursuant to any Prospectus Supplement since the aggregate
principal amounts and the terms of such Debt Securities are not presently known.
|
Year ended
December 31, 2017
|
Interest requirements
|
US$0.43
|
Earnings (loss) before interest expense and taxes
|
(U.S.$8.3 million)
|
Earnings coverage
|
19.3
|
If the Company offers any Debt Securities having a term to
maturity in excess of one year under a Prospectus Supplement, the Prospectus
Supplement will include earnings coverage ratios giving effect to the issuance
of such Debt Securities. As of December 31, 2017, the Company has no debt
obligations.
DIVIDEND POLICY
The Company has not declared or paid any dividends on its
Common Shares since the date of its incorporation. The Company intends to retain
its earnings, if any, to finance the growth and development of its business and
does not expect to pay dividends or to make any other distributions in the near
future. The Companys board of directors will review this policy from time to
time having regard to the Companys financing requirements, financial condition
and other factors considered to be relevant.
DESCRIPTION OF COMMON SHARES
The Companys authorized share capital consists of an unlimited
number of Common Shares without par value. As at the date of this Prospectus,
there are 127,488,410 Common Shares issued and outstanding.
Each Common Share ranks equally with all other Common Shares
with respect to distribution of assets upon dissolution, liquidation or
winding-up of the Company and payment of dividends. The holders of Common Shares
are entitled to one vote for each share on all matters to be voted on by such
holders and are entitled to receive pro rata such dividends as may be declared
by the board of directors of the Company. The holders of Common Shares have no
pre-emptive or conversion rights. The rights attaching to the Common Shares can
only be modified by the affirmative vote of at least two-thirds of the votes
cast at a meeting of shareholders called for that purpose.
DESCRIPTION OF WARRANTS
The following description, together with the additional
information the Company may include in any Prospectus Supplements, summarizes
the material terms and provisions of the Warrants that the Company may offer
under this Prospectus, which may consist of Warrants to purchase Common Shares
or other Securities and may be issued in one or more series. Warrants may be
offered independently or together with Common Shares or other Securities offered
by any Prospectus Supplement, and may be attached to or separate from those
Securities. Warrants will not, however, be offered for sale separately to any
member of the public in Canada unless the offering is in connection with, and
forms part of, the consideration for an acquisition or merger transaction. While
the terms summarized below will apply generally to any Warrants that the Company
may offer under this Prospectus, the Company will describe the particular terms
of any series of Warrants that it may offer in more detail in the applicable
Prospectus Supplement. The terms of any Warrants offered under a
Prospectus Supplement may differ from the terms described below.
8
General
Warrants will be issued under and governed by the terms of one
or more warrant indentures or agreement (each a
Warrant Indenture
)
between the Company and a warrant agent or warrant trustee (a
Warrant
Agent
) that the Company will name in the relevant Prospectus Supplement.
Each Warrant Agent will be a financial institution organized under the laws of
Canada or any province thereof and authorized to carry on business as a trustee.
If applicable, the Company will file with the SEC as exhibits to the
registration statement of which this Prospectus is a part, or will incorporate
by reference from a Report of Foreign Private Issuer on Form 6-K that the
Company files with the SEC, any Warrant Indenture describing the terms and
conditions of such Warrants that the Company is offering before the issuance of
such Warrants.
This summary of some of the provisions of the Warrants is not
complete. The statements made in this Prospectus relating to any Warrant
Indenture and Warrants to be issued under this Prospectus are summaries of
certain anticipated provisions thereof and do not purport to be complete and are
subject to, and are qualified in their entirety by reference to, all provisions
of the applicable Warrant Indenture. Prospective investors should refer to the
Warrant Indenture relating to the specific Warrants being offered for the
complete terms of the Warrants. The applicable Prospectus Supplement relating to
any Warrants offered by us will describe the particular terms of those Warrants
and include specific terms relating to the offering.
The particular terms of each issue of Warrants will be
described in the applicable Prospectus Supplement. This description will
include, where applicable:
|
the designation and aggregate number of Warrants;
|
|
|
|
the price at which the Warrants will be offered;
|
|
|
|
the currency or currencies in which the Warrants will be
offered;
|
|
|
|
the date on which the right to exercise the Warrants will
commence and the date on which the right will expire;
|
|
|
|
the number of Common Shares or other Securities that may
be purchased upon exercise of each Warrant and the price at which and
currency or currencies in which the Common Shares or other Securities may
be purchased upon exercise of each Warrant;
|
|
|
|
the designation and terms of any Securities with which
the Warrants will be offered, if any, and the number of the Warrants that
will be offered with each Security;
|
|
|
|
the date or dates, if any, on or after which the Warrants
and the other Securities with which the Warrants will be offered will be
transferable separately;
|
|
|
|
any minimum or maximum number of Warrants that may be
exercised at any one time;
|
|
|
|
whether the Warrants will be subject to redemption and,
if so, the terms of such redemption provisions;
|
|
|
|
whether the Company will issue the Warrants as global
securities and, if so, the identity of the depositary of the global
securities;
|
|
|
|
whether the Warrants will be listed on an exchange;
|
9
|
material Canadian federal income tax consequences and, if
applicable, material United States federal income tax consequences of
owning the Warrants; and
|
|
|
|
and any other material terms or
conditions of the Warrants.
|
Rights of Holders Prior to Exercise
Prior to the exercise of Warrants, holders of Warrants will not
have any of the rights of holders of the Common Shares or other Securities
issuable upon exercise of the Warrants.
Exercise of Warrants
Each Warrant will entitle the holder to purchase the Securities
that the Company specifies in the applicable Prospectus Supplement at the
exercise price described therein. Unless the Company otherwise specifies in the
applicable Prospectus Supplement, holders of the Warrants may exercise the
Warrants at any time up to the specified time on the expiration date set forth
in the applicable Prospectus Supplement. After the close of business on the
expiration date, unexercised Warrants will become void.
Holders of the Warrants may exercise the Warrants by delivering
the Warrant Certificate representing the Warrants to be exercised together with
specified information, and paying the required amount to the Warrant Agent in
immediately available funds, as provided in the applicable Prospectus
Supplement. The Company will set forth on the Warrant Certificate and in the
applicable Prospectus Supplement the information that the holder of the Warrant
will be required to deliver to the Warrant Agent.
Upon receipt of the required payment and the Warrant
Certificate properly completed and duly executed at the corporate trust office
of the Warrant Agent or any other office indicated in the applicable Prospectus
Supplement, the Company will issue and deliver the Securities purchasable upon
such exercise. If fewer than all of the Warrants represented by the Warrant
Certificate are exercised, then the Company will issue a new Warrant Certificate
for the remaining amount of Warrants. If the Company so indicates in the
applicable Prospectus Supplement, holders of the Warrants may surrender
securities as all or part of the exercise price for Warrants.
Anti-Dilution
The Warrant Indenture will specify that, upon the subdivision,
consolidation, reclassification or other material change of the Common Shares or
any other reorganization, amalgamation, arrangement, merger or sale of all or
substantially all of the Companys assets, Warrants exercisable for Common
Shares will thereafter evidence the right of the holder to receive the
securities, property or cash deliverable in exchange for or on the conversion of
or in respect of the Common Shares to which the holder of a Common Share would
have been entitled immediately after such event. Similarly, any distribution to
all or substantially all of the holders of Common Shares of rights, options,
warrants, evidences of indebtedness or assets will result in an adjustment in
the number of Common Shares to be issued to holders of Warrants that are
exercisable for Common Shares.
Global Securities
The Company may issue Warrants in whole or in part in the form
of one or more global securities, which will be registered in the name of and be
deposited with a depositary, or its nominee, each of which will be identified in
the applicable Prospectus Supplement. The global securities may be in temporary
or permanent form. The applicable Prospectus Supplement will describe the terms
of any depositary arrangement and the rights and limitations of owners of
beneficial interests in any global security. The applicable Prospectus
Supplement will describe the exchange, registration and transfer rights relating
to any global security.
Modifications
The Warrant Indenture will provide for modifications and
alterations to the Warrants issued thereunder by way of a resolution of holders
of Warrants at a meeting of such holders or a consent in writing from such
holders. The number of holders of Warrants required to pass such a
resolution or execute such a written consent will be specified in the Warrant
Indenture.
10
The Company may amend any Warrant Indenture and the Warrants,
without the consent of the holders of the Warrants, to cure any ambiguity, to
cure, correct or supplement any defective or inconsistent provision, or in any
other manner that will not materially and adversely affect the interests of
holders of outstanding Warrants.
DESCRIPTION OF SUBSCRIPTION RECEIPTS
The Company may issue Subscription Receipts, which will entitle
holders to receive upon satisfaction of certain release conditions and for no
additional consideration, Common Shares, Warrants or any combination thereof.
Subscription Receipts will be issued pursuant to one or more subscription
receipt agreements (each, a
Subscription Receipt Agreement
), each to be
entered into between the Company and an escrow agent (the
Escrow
Agent
), which will establish the terms and conditions of the Subscription
Receipts. Each Escrow Agent will be a financial institution organized under the
laws of Canada or a province thereof and authorized to carry on business as a
trustee. A copy of the form of Subscription Receipt Agreement will be filed with
Canadian securities regulatory authorities and, if applicable, the Company will
file with the SEC as exhibits to the registration statement of which this
Prospectus is a part, or will incorporate by reference from a Report of Foreign
Private Issuer on Form 6-K that the Company files with the SEC, any Subscription
Receipt Agreement describing the terms and conditions of such Subscription
Receipts that the Company is offering before the issuance of such Subscription
Receipts.
The following description sets forth certain general terms and
provisions of Subscription Receipts and is not intended to be complete. The
statements made in this Prospectus relating to any Subscription Receipt
Agreement and Subscription Receipts to be issued thereunder are summaries of
certain anticipated provisions thereof and are subject to, and are qualified in
their entirety by reference to, all provisions of the applicable Subscription
Receipt Agreement and the Prospectus Supplement describing such Subscription
Receipt Agreement.
The Prospectus Supplement relating to any Subscription Receipts
the Company offers will describe the Subscription Receipts and include specific
terms relating to their offering. All such terms will comply with the
requirements of the TSX and NYSE relating to Subscription Receipts. If
underwriters or agents are used in the sale of Subscription Receipts, one or
more of such underwriters or agents may also be parties to the Subscription
Receipt Agreement governing the Subscription Receipts sold to or through such
underwriters or agents.
General
The Prospectus Supplement and the Subscription Receipt
Agreement for any Subscription Receipts the Company offers will describe the
specific terms of the Subscription Receipts and may include, but are not limited
to, any of the following:
|
the designation and aggregate number of Subscription
Receipts offered;
|
|
|
|
the price at which the Subscription Receipts will be
offered;
|
|
|
|
the currency or currencies in which the Subscription
Receipts will be offered;
|
|
|
|
the designation, number and terms of the Common Shares,
Warrants or combination thereof to be received by holders of Subscription
Receipts upon satisfaction of the release conditions, and the procedures
that will result in the adjustment of those numbers;
|
|
|
|
the conditions (the
Release Conditions
) that
must be met in order for holders of Subscription Receipts to receive for
no additional consideration Common Shares, Warrants or a combination
thereof;
|
|
|
|
the procedures for the issuance and delivery of Common
Shares, Warrants or a combination thereof to holders of Subscription
Receipts upon satisfaction of the Release Conditions;
|
11
|
whether any payments will be made to holders of
Subscription Receipts upon delivery of the Common Shares, Warrants or a
combination thereof upon satisfaction of the Release Conditions (e.g. an
amount equal to dividends declared on Common Shares by the Company to
holders of record during the period from the date of issuance of the
Subscription Receipts to the date of issuance of any Common Shares
pursuant to the terms of the Subscription Receipt Agreement);
|
|
|
|
the identity of the Escrow Agent;
|
|
|
|
the terms and conditions under which the Escrow Agent
will hold all or a portion of the gross proceeds from the sale of
Subscription Receipts, together with interest and income earned thereon
(collectively, the
Escrowed Funds
), pending satisfaction of the
Release Conditions;
|
|
|
|
the terms and conditions pursuant to which the Escrow
Agent will hold Common Shares, Warrants or a combination thereof pending
satisfaction of the Release Conditions;
|
|
|
|
the terms and conditions under which the Escrow Agent
will release all or a portion of the Escrowed Funds to the Company upon
satisfaction of the Release Conditions;
|
|
|
|
if the Subscription Receipts are sold to or through
underwriters or agents, the terms and conditions under which the Escrow
Agent will release a portion of the Escrowed Funds to such underwriters or
agents in payment of all or a portion of their fees or commission in
connection with the sale of the Subscription Receipts;
|
|
|
|
procedures for the refund by the Escrow Agent to holders
of Subscription Receipts of all or a portion of the subscription price for
their Subscription Receipts, plus any pro rata entitlement to interest
earned or income generated on such amount, if the Release Conditions are
not satisfied;
|
|
|
|
any contractual right of rescission to be granted to
initial purchasers of Subscription Receipts in the event this Prospectus,
the Prospectus Supplement under which Subscription Receipts are issued or
any amendment hereto or thereto contains a misrepresentation;
|
|
|
|
any entitlement of the Company to purchase the
Subscription Receipts in the open market by private agreement or
otherwise;
|
|
|
|
whether the Company will issue the Subscription Receipts
as global securities and, if so, the identity of the depositary for the
global securities;
|
|
|
|
whether the Company will issue the Subscription Receipts
as bearer securities, registered securities or both;
|
|
|
|
provisions as to modification, amendment or variation of
the Subscription Receipt Agreement or any rights or terms attaching to the
Subscription Receipts;
|
|
|
|
whether the Subscription Receipts will be listed on an
exchange;
|
|
|
|
material Canadian federal income tax consequences and, if
applicable, material United States federal income tax consequences of
owning the Subscription Receipts; and
|
|
|
|
any other terms of the Subscription Receipts.
|
The holders of Subscription Receipts will not be
shareholders of the Company. Holders of Subscription Receipts are entitled only
to receive Common Shares, Warrants or a combination thereof on exchange of their
Subscription Receipts, plus any cash payments provided for under the
Subscription Receipt Agreement, if the Release Conditions are satisfied. If the
Release Conditions are not satisfied, Holders of Subscription Receipts shall be
entitled to a refund of all or a portion of the subscription price therefor and
all or a portion
of the pro rata share of interest earned or income generated
thereon, as provided in the Subscription Receipt Agreement.
12
Escrow
The Escrowed Funds will be held in escrow by the Escrow Agent,
and such Escrowed Funds will be released to the Company (and, if the
Subscription Receipts are sold to or through underwriters or agents, a portion
of the Escrowed Funds may be released to such underwriters or agents in payment
of all or a portion of their fees in connection with the sale of the
Subscription Receipts) at the time and under the terms specified by the
Subscription Receipt Agreement. If the Release Conditions are not satisfied,
holders of Subscription Receipts will receive a refund of all or a portion of
the subscription price for their Subscription Receipts plus their pro rata
entitlement to interest earned or income generated on such amount, in accordance
with the terms of the Subscription Receipt Agreement. Common Shares or Warrants
may be held in escrow by the Escrow Agent and will be released to the holders of
Subscription Receipts following satisfaction of the Release Conditions at the
time and under the terms specified in the Subscription Receipt Agreement.
Anti-Dilution
The Subscription Receipt Agreement will specify that upon the
subdivision, consolidation, reclassification or other material change of Common
Shares or Warrants underlying the particular Subscription Receipts or any other
reorganization, amalgamation, arrangement, merger or sale of all or
substantially all of the Companys assets, the Subscription Receipts will
thereafter evidence the right of the holder to receive the securities, property
or cash deliverable in exchange for or on the conversion of or in respect of the
Common Shares or Warrants to which the holder of a Common Share or identical
Warrant would have been entitled immediately after such event. Similarly, any
distribution to all or substantially all of the holders of Common Shares of
rights, options, warrants, evidences of indebtedness or assets will result in an
adjustment in the number of Common Shares to be issued to holders of
Subscription Receipts whose Subscription Receipts entitle the holders thereof to
receive Common Shares. Alternatively, such securities, evidences of indebtedness
or assets may, at the option of the Company, be issued to the Escrow Agent and
delivered to holders of Subscription Receipts on exercise thereof. The
Subscription Receipt Agreement will also provide that if other actions of the
Company affect the Common Shares or Warrants, which, in the reasonable opinion
of the directors of the Company, would materially affect the rights of the
holders of Subscription Receipts and/or the rights attached to the Subscription
Receipts, the number of Common Shares or Warrants which are to be received
pursuant to the Subscription Receipts shall be adjusted in such manner, if any,
and at such time as the directors of the Company may in their discretion
reasonably determine to be equitable to the holders of Subscription Receipts in
such circumstances.
Rescission
The Subscription Receipt Agreement will also provide that any
misrepresentation in this Prospectus, the Prospectus Supplement under which the
Subscription Receipts are offered, or any amendment hereto or thereto, will
entitle each initial purchaser of Subscription Receipts to a contractual right
of rescission following the issuance of the Common Shares or Warrants to such
purchaser entitling such purchaser to receive the amount paid for the
Subscription Receipts upon surrender of the Common Shares or Warrants, provided
that such remedy for rescission is exercised in the time stipulated in the
Subscription Receipt Agreement. This right of rescission does not extend to
holders of Subscription Receipts who acquire such Subscription Receipts from an
initial purchaser, on the open market or otherwise, or to initial purchasers who
acquire Subscription Receipts in the United States.
Global Securities
The Company may issue Subscription Receipts in whole or in part
in the form of one or more global securities, which will be registered in the
name of and be deposited with a depositary, or its nominee, each of which will
be identified in the applicable Prospectus Supplement. The global securities may
be in temporary or permanent form. The applicable Prospectus Supplement will
describe the terms of any depositary arrangement and the rights and limitations
of owners of beneficial interests in any global security. The applicable
Prospectus Supplement also will describe the exchange, registration and transfer
rights relating to any global security.
13
Modifications
The Subscription Receipt Agreement will provide for
modifications and alterations to the Subscription Receipts issued thereunder by
way of a resolution of holders of Subscription Receipts at a meeting of such
holders or a consent in writing from such holders. The number of holders of
Subscriptions Receipts required to pass such a resolution or execute such a
written consent will be specified in the Subscription Receipt Agreement.
DESCRIPTION OF DEBT SECURITIES
In this section describing the Debt Securities, the Company
refers only to Endeavour Silver Corp. without any of its subsidiaries. This
section describes the general terms that will apply to any Debt Securities
issued pursuant to this Prospectus. The specific terms of the Debt Securities,
and the extent to which the general terms described in this section apply to
those Debt Securities, will be set forth in the applicable Prospectus
Supplement.
The Debt Securities will be issued in one or more series under
an indenture (the
Trust Indenture
) to be entered into between the
Company and one or more trustees (the
Debt Trustee
) that will be named
in a Prospectus Supplement for a series of Debt Securities. To the extent
applicable, the Trust Indenture will be subject to and governed by the Business
Corporations Act (British Columbia) and/or the United States Trust Indenture Act
of 1939, as amended. A copy of the form of the Trust Indenture to be entered
into has been filed with the SEC as an exhibit to the registration statement of
which this Prospectus forms a part. The description of certain provisions of the
Trust Indenture in this section is not intended to be complete and is qualified
in its entirety by reference to the provisions of the Trust Indenture. Terms
used in this summary that are not otherwise defined herein have the meaning
ascribed to them in the Trust Indenture.
The Company may issue Debt Securities and incur additional
indebtedness other than through the offering of Debt Securities pursuant to this
Prospectus.
General
The Trust Indenture does not limit the aggregate principal
amount of Debt Securities which the Company may issue under the Trust Indenture
and does not limit the amount of other indebtedness that the Company may incur.
The Company may issue Debt Securities from time to time in one or more series
which may be denominated and payable in U.S. dollars, Canadian dollars or any
other currency. Unless otherwise indicated in the applicable Prospectus
Supplement, the Trust Indenture permits the Company, without the consent of the
holders of any Debt Securities, to increase the principal amount of any series
of Debt Securities the Company has previously issued under the Trust Indenture
and to issue such increased principal amount.
The applicable Prospectus Supplement will set forth the
following terms relating to the Debt Securities offered by such Prospectus
Supplement (the
Offered Debt Securities
):
|
the specific designation of the Offered Debt Securities;
any limit on the aggregate principal amount of the Offered Debt
Securities; the date or dates, if any, on which the Offered Debt
Securities will mature and the portion (if less than all of the principal
amount) of the Offered Debt Securities to be payable upon declaration of
acceleration of maturity;
|
|
|
|
the rate or rates (whether fixed or variable) at which
the Offered Debt Securities will bear interest, if any, the date or dates
from which any such interest will accrue and on which any such interest
will be payable and the record dates for any interest payable on the
Offered Debt Securities that are in registered form;
|
|
|
|
the terms and conditions under which the Company may be
obligated to redeem, repay or purchase the Offered Debt Securities
pursuant to any sinking fund or analogous provisions or otherwise;
|
|
|
|
the terms and conditions upon which the Company may
redeem or prepay the Offered Debt Securities, in whole or in part, at its
option;
|
14
|
the covenants applicable to the Offered Debt Securities;
|
|
|
|
the terms and conditions for any conversion or exchange
of the Offered Debt Securities for any other securities;
|
|
|
|
any restrictions or other provisions relating to the
transfer or exchange of Offered Debt Securities;
|
|
|
|
whether the Offered Debt Securities will be issuable in
registered form or bearer form or both, and, if issuable in bearer form,
the restrictions as to the offer, sale and delivery of the Offered Debt
Securities which are in bearer form and as to exchanges between registered
form and bearer form;
|
|
|
|
whether the Offered Debt Securities will be issuable in
the form of registered global securities (
Global
Debt
Securities
), and, if so, the identity of the depositary for such
registered Global Debt Securities;
|
|
|
|
the denominations in which registered Offered Debt
Securities will be issuable, if other than denominations of U.S.$1,000 and
integral multiples of U.S.$1,000 and the denominations in which bearer
Offered Debt Securities will be issuable, if other than U.S.$5,000;
|
|
|
|
each office or agency where payments on the Offered Debt
Securities will be made (if other than the offices or agencies described
under the heading Payment below) and each office or agency where the
Offered Debt Securities may be presented for registration of transfer or
exchange;
|
|
|
|
the currency in which the Offered Debt Securities are
denominated or the currency in which the Company will make payments on the
Offered Debt Securities;
|
|
|
|
any index, formula or other method used to determine the
amount of payments of principal of (and premium, if any) or interest, if
any, on the Offered Debt Securities;
|
|
|
|
events of default by the Company and covenants of the
Company; and
|
|
|
|
any other terms of the Offered Debt Securities not
prohibited by the Trust Indenture which apply solely to the Offered Debt
Securities, or terms described herein as generally applicable to the Debt
Securities which are not to apply to the Offered Debt Securities.
|
Unless otherwise indicated in the applicable Prospectus
Supplement:
(a)
|
holders may not tender Debt Securities to the Company for
repurchase, and
|
|
|
(b)
|
the holders of the Debt Securities will not be afforded
protection under the Trust Indenture in the event of a highly leveraged
transaction or a change in control of the Company, except in certain
specified circumstances.
|
The Company may issue Debt Securities under the Trust Indenture
bearing no interest or interest at a rate below the prevailing market rate at
the time of issuance and, in such circumstances, the Company may offer and sell
those Debt Securities at a discount below their stated principal amount. The
Company will describe in the applicable Prospectus Supplement any Canadian and
United States federal income tax consequences and other special considerations
applicable to any discounted Debt Securities or other Debt Securities offered
and sold at par which are treated as having been issued at a discount for
Canadian and/or United States federal income tax purposes.
Any Debt Securities issued by the Company will be direct,
unconditional and unsecured obligations of the Company and will rank equally
among themselves and with all of the Companys other unsecured, unsubordinated
obligations, except to the extent prescribed by law. Debt Securities issued by
the Company will be structurally subordinated to all existing and future
liabilities, including trade payables and other indebtedness, of the Companys
subsidiaries.
15
The Company will agree to provide to the Debt Trustee (i)
annual reports containing audited financial statements and (ii) quarterly
reports for the first three quarters of each fiscal year containing unaudited
financial information.
Form, Denomination, Exchange and Transfer
Unless otherwise indicated in the applicable Prospectus
Supplement, the Company will issue Debt Securities only in fully registered form
without coupons, and in denominations of U.S.$1,000 and integral multiples of
U.S.$1,000. Debt Securities may be presented for exchange and registered Debt
Securities may be presented for registration of transfer in the manner to be set
forth in the Trust Indenture and in the applicable Prospectus Supplement,
without service charges. The Company may, however, require payment sufficient to
cover any taxes or other governmental charges due in connection with the
exchange or transfer. The Company will appoint the Debt Trustee as security
registrar. Bearer Debt Securities and the coupons applicable to bearer Debt
Securities thereto will be transferable by delivery.
Payment
Unless otherwise indicated in the applicable Prospectus
Supplement, the Company will make payments on registered Debt Securities (other
than Global Debt Securities) at the office or agency of the Trustee, except that
the Company may choose to pay interest (a) by cheque mailed to the address of
the person entitled to such payment as specified in the security register, or
(b) by wire transfer to an account maintained by the person entitled to such
payment as specified in the security register. Unless otherwise indicated in the
applicable Prospectus Supplement, the Company will pay any interest due on
registered Debt Securities to the persons in whose name such registered
Securities are registered on the day or days specified in the applicable
Prospectus Supplement.
Registered Global Debt Securities
Unless otherwise indicated in the applicable Prospectus
Supplement, Registered Debt Securities will be issued in global form that will
be deposited with, or on behalf of, a depositary (the
Depositary
)
identified in the Prospectus Supplement. Global Debt Securities will be
registered in the name of the Depositary, and the Debt Securities included in
the Global Debt Securities may not be transferred to the name of any other
direct holder unless the special circumstances described below occur. Any person
wishing to own Debt Securities issued in the form of Global Debt Securities must
do so indirectly by virtue of an account with a broker, bank or other financial
institution that, in turn, has an account with the Depositary.
Special Investor Considerations for Global Debt
Securities
The Companys obligations under the Trust Indenture, as well as
the obligations of the Debt Trustee and those of any third parties employed by
the Company or the Debt Trustee, run only to persons who are registered as
holders of Debt Securities. For example, once the Company makes payment to the
registered holder, the Company has no further responsibility for the payment
even if that holder is legally required to pass the payment along to an investor
but does not do so. As an indirect holder, an investors rights relating to a
Global Debt Security will be governed by the account rules of the investors
financial institution and of the Depositary, as well as general laws relating to
debt securities transfers.
An investor should be aware that when Debt Securities are
issued in the form of Global Debt Securities:
(a)
|
the investor cannot have Debt Securities registered in
the investors own name,
|
|
|
(b)
|
the investor cannot receive physical certificates for the
investors interest in the Debt Securities,
|
|
|
(c)
|
the investor must look to his or her own bank, brokerage
firm or other financial institution for payments on the Debt Securities
and protection of his or her legal rights relating to the Debt
Securities,
|
|
|
(d)
|
the investor may not be able to sell interests in the
Debt Securities to some insurance companies and other institutions that
are required by law to hold the physical certificates of Debt Securities
that they own,
|
16
(e)
|
the Depositarys policies will govern payments,
transfers, exchange and other matters relating to the investors interest
in the Global Debt Security; the Company and the Debt Trustee will have no
responsibility for any aspect of the Depositarys actions or for its
records of ownership interests in the Global Debt Security; the Company
and the Debt Trustee also do not supervise the Depositary in any way,
and
|
|
|
(f)
|
the Depositary will usually require that interests in a
Global Debt Security be purchased or sold within its system using same-day
funds.
|
Special Situations When Global Debt Security Will be
Terminated
In a few special situations described below, a Global Debt
Security will terminate and interests in it will be exchanged for physical
certificates representing Debt Securities. After that exchange, an investor may
choose whether to hold Debt Securities directly or indirectly through an account
at its bank, brokerage firm or other financial institution. Investors must
consult their own banks, brokers or other financial institutions to find out how
to have their interests in Debt Securities transferred into their own names, so
that they will be registered holders of the Debt Securities represented by each
Global Debt Security.
The special situations for termination of a Global Debt
Security are:
(a)
|
when the Depositary notifies the Company that it is
unwilling, unable or no longer qualified to continue as Depositary (unless
a replacement Depositary is named); and
|
|
|
(b)
|
when and if the Company decides to terminate a Global
Debt Security.
|
When a Global Debt Security terminates, the Depositary (and not
the Company or the Debt Trustee) will be responsible for deciding the names of
the institutions that will be the initial direct holders.
Events of Default
Unless otherwise indicated in the applicable Prospectus
Supplement, the term Event of Default with respect to Debt Securities issued
under the Trust Indenture means any of the following:
(a)
|
default in the payment of the principal amount,
redemption price or fundamental change purchase price on any Debt Security
when it becomes due and payable;
|
|
|
(b)
|
default in the payment of interest, additional interest
amounts or other additional amounts, if any, upon any Debt Security, when
such amounts become due and payable, and continuance of such default for a
period of 30 days;
|
|
|
(c)
|
default in the performance of any covenant, agreement or
condition of the Company in the Trust Indenture or the debt securities and
continuance of such default for a period of 60 days after there has been
given, by registered or certified mail, to the Company by the Debt Trustee
or to the Company and the Debt Trustee by the holders of at least 25% in
aggregate principal amount of the outstanding Debt Securities a written
notice specifying such default and requiring it to be remedied and stating
that such notice is a Notice of Default under the Trust
Indenture;
|
|
|
(d)
|
failure by the Company to convert Debt Securities into
Common Shares and/or for cash at the Company's election upon exercise of a
holders conversion right and such failure continues for five Business
Days or more;
|
|
|
(e)
|
default in the payment of any indebtedness (other than
indebtedness that is non-recourse to the Company or its subsidiaries) for
borrowed money by the Company or any of its subsidiaries (all or
substantially all of the outstanding voting securities of which are owned,
directly or indirectly, by the Company) in an outstanding principal amount
in excess of U.S.$10,000,000 when such amounts become due at
final maturity or upon acceleration, and such indebtedness is
not discharged, or such default in payment or acceleration is not cured or
rescinded within the period specified in such instrument;
|
17
(f)
|
the rendering of a final judgment or judgments (not
subject to appeal and not covered by insurance) against the Company or any
of its subsidiaries in excess of U.S.$10,000,000 which remains unstayed,
undischarged or unbonded for a period of 60 days;
|
|
|
(g)
|
failure by the Company to give notice of a fundamental
change as set forth in the Trust Indenture;
|
|
|
(h)
|
failure by the Company to comply with its obligations
under the Trust Indenture regarding consolidations, mergers and the sale,
conveyance or leasing of substantially all of its assets;
|
|
|
(i)
|
the entry by a court having jurisdiction in the premises
of (i) a decree or order for relief in respect of the Company or any of
its subsidiaries of a voluntary case or proceeding under any applicable
United States or Canadian federal, state or provincial bankruptcy,
insolvency, reorganization or other similar law or (ii) a decree or order
adjudging the Company as bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any applicable United
States or Canadian federal, state or provincial law or (iii) appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and
the continuance of any such decree or order for relief or any such other
appointment, decree or order unstayed and in effect for a period of 60
consecutive days; or
|
|
|
(j)
|
the commencement by the Company or any of its
subsidiaries of a voluntary case or proceeding under any applicable United
States or Canadian federal, state or provincial bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable United States or
Canadian federal, state or provincial bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any
bankruptcy or insolvency case or proceeding against it, or the filing by
it of a petition or answer or consent seeking reorganization or relief
under any applicable federal or state law, or the consent by it to the
filing of such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its
property, or the making by it of an assignment for the benefit of
creditors.
|
If an Event of Default occurs and is continuing with respect to
Debt Securities, then the Debt Trustee or the holders of not less than 25% in
principal amount of the outstanding Debt Securities may require the principal
amount of all the outstanding Debt Securities and any accrued but unpaid
interest on such Debt Securities be paid immediately. However, at any time after
a declaration of acceleration with respect to Debt Securities has been made and
before a judgment or decree for payment of the money due has been obtained, the
holders of a majority in principal amount of the outstanding Debt Securities, by
written notice to the Company and the Debt Trustee, may, under certain
circumstances, rescind and annul such acceleration.
Other than its duties in the case of an Event of Default, the
Debt Trustee will not be obligated to exercise any of its rights and powers
under the Trust Indenture at the request or direction of any of the holders,
unless the holders have offered to the Debt Trustee reasonable indemnity. If the
holders provide indemnity satisfactory to the Debt Trustee, the holders of a
majority in principal amount of the outstanding Debt Securities may, subject to
certain limitations, direct the time, method and place of conducting any
proceeding for any remedy available to the Debt Trustee, or exercising any trust
or power conferred on the Debt Trustee, with respect to the Debt Securities.
No holder of a Debt Security will have any right to institute
any proceedings, unless:
(a)
|
such holder has previously given to the Debt Trustee
written notice of a continuing Event of Default with respect to the Debt
Securities,
|
18
(b)
|
the holders of at least 25% in principal amount of the
outstanding Debt Securities have made written request and have offered
reasonable indemnity to the Debt Trustee to institute such proceedings as
trustee, and
|
|
|
(c)
|
the Debt Trustee has failed to institute such proceeding,
and has not received from the holders of a majority in the aggregate
principal amount of outstanding Debt Securities a direction inconsistent
with such request, within 60 days after such notice, request and
offer.
|
These limitations do not apply, however, to a suit instituted
by the holder of a Debt Security for the enforcement of payment of principal of
or interest on such Debt Security on or after the applicable due date of such
payment.
The Company will be required to furnish to the Debt Trustee
annually an officers certificate as to the performance of certain of its
obligations under the Trust Indenture and as to any default in such performance.
Modifications and Waivers
The Company may modify or amend the Trust Indenture with the
consent of the holders of a majority in aggregate principal amount of the
outstanding Debt Securities; provided, however, unless otherwise stated in the
applicable Prospectus Supplement, that the Company will be required to receive
consent from the holder of each outstanding Debt Security to:
(a)
|
extend the fixed maturity of any Debt Security,
|
|
|
(b)
|
reduce the principal amount of or reduce the interest
rate on or extend the stated time for payment of interest, including
additional interest amounts and additional amounts, if any, on any Debt
Security,
|
|
|
(c)
|
reduce the redemption price or fundamental change
purchase price of any Debt Security,
|
|
|
(d)
|
after the occurrence of a fundamental change, make any
change that adversely affects the right of holders of the Debt Securities
to require the Company to purchase such Debt Securities in accordance with
the terms thereof and the Trust Indenture,
|
|
|
(e)
|
change the currency of any payment amount of any Debt
Security from the original currency or Common Shares as provided in the
Trust Indenture,
|
|
|
(f)
|
make any change that impairs the right of holders of Debt
Securities to convert any Debt Security,
|
|
|
(g)
|
make any change that impairs the right of holders to
institute suit for payment of the Debt Securities,
|
|
|
(h)
|
reduce the percentage in principal amount of outstanding
Debt Securities, the consent of whose holders is required for any such
supplemental indenture, or the consent of whose holders is required for
any waiver (of compliance with certain provisions of the Trust Indenture
or certain defaults thereunder and their consequences) provided for in the
Trust Indenture,
|
|
|
(i)
|
modify the obligation of the Company to maintain an
agency in the city of New York as required under the Trust
Indenture,
|
|
|
(j)
|
change the ranking of the notes in any manner that
adversely affects the rights of holders of Debt Securities under the Trust
Indenture, or
|
|
|
(k)
|
modify any of the provisions relating to the foregoing
modifications or waivers of past defaults, except to increase any such
percentage or to provide that certain other provisions of the Trust
Indenture cannot be modified or waived without the consent of the holder
of each outstanding Debt Security affected
thereby.
|
The holders of a majority in principal amount of Debt
Securities may, on behalf of the holders of all Debt Securities, waive the
Companys compliance with certain restrictive provisions of the Trust Indenture.
The holders of a majority in principal amount of outstanding Debt Securities may
waive any past default under the Trust Indenture, except a default in the
payment of the principal of or interest on any Debt Security or in respect of
any item listed immediately before this paragraph.
19
The Trust Indenture or the Debt Securities may be amended or
supplemented, without the consent of any holder of such Debt Securities, in
order to, among other things, cure any ambiguity or inconsistency, comply with
applicable law or to make any change, in any case, that does not have a
materially adverse effect on the rights of any holder of such Debt Securities.
Consent to Jurisdiction and Service
Under the Trust Indenture, the Company will irrevocably appoint
an authorized agent upon which process may be served in any suit, action or
proceeding arising out of or relating to the Debt Securities or the Trust
Indenture that may be instituted in any United States federal or New York state
court located in the city of New York, and will submit to such non-exclusive
jurisdiction.
Governing Law
The Trust Indenture and the Debt Securities will be governed by
and construed in accordance with the laws of the State of New York, but without
giving effect to applicable principles of conflicts of law to the extent that
the application of the law of another jurisdiction would be required thereby.
Enforceability of Judgments
Since all of the assets of the Company are outside the United
States, any judgment obtained in the United States against the Company would
need to be satisfied by seeking enforcement of such judgment in a court located
outside of the United States from the Companys assets.
The Debt Trustee
The Debt Trustee under the Trust Indenture or its affiliates
may provide other services to the Company in the ordinary course of their
business.
The Trust Indenture will contain certain limitations on the
rights of the Debt Trustee, as long as it or any of its affiliates remains the
Companys creditor, to obtain payment of claims in certain cases or to realize
on certain property received on any claim as security or otherwise. The Debt
Trustee and its affiliates will be permitted to engage in other transactions
with the Company. If the Debt Trustee or any affiliate acquires any conflicting
interest and a default occurs with respect to the Debt Securities, the Debt
Trustee must eliminate the conflict or resign.
DESCRIPTION OF UNITS
The following description, together with the additional
information the Company may include in any applicable Prospectus Supplements,
summarizes the material terms and provisions of the Units that the Company may
offer under this Prospectus. While the terms summarized below will apply
generally to any Units that the Company may offer under this Prospectus, the
Company will describe the particular terms of any issue of Units in more detail
in the applicable Prospectus Supplement. The terms of any Units offered under a
Prospectus Supplement may differ from the terms described below.
The Company will also add to disclosure in any subsequent
Prospectus Supplement whereby Units are offered the form of any unit agreement
(
Unit Agreement
) between the Company and a unit agent (
Unit
Agent
) that describes the terms and conditions of the issue of Units being
offered, and any supplemental agreements. The following summaries of material
terms and provisions of the Units are subject to, and qualified in their
entirety by reference to, all the provisions of any Unit Agreement and any
supplemental agreements applicable to a particular issue of Units. The Company
urges you to read the applicable Prospectus Supplements relating to the
particular issue of Units that the Company sells under this Prospectus, as well
as any Unit Agreement and any supplemental agreements that contain the terms of the Units. If applicable,
the Company will file with the SEC as exhibits to the registration statement of
which this Prospectus is a part, or will incorporate by reference from a current
report on Form 6-K that the Company files with the SEC, any Unit Agreement
describing the terms and conditions of such Units that the Company is offering
before the issuance of such Units.
20
General
The Company may issue Units comprising two or more of Common
Shares, Warrants or Debt Securities, in any combination. Each Unit will be
issued so that the holder of the Unit is also the holder of each Security
included in the Unit. Therefore, the holder of a Unit will have the rights and
obligations of a holder of each included Security. Any Unit Agreement under
which a Unit is issued may provide that the Securities included in the Unit may
not be held or transferred separately, at any time or at any time before a
specified date. The Company will describe in the applicable Prospectus
Supplement the terms of the issue of Units, including: the designation and terms
of the Units and of the securities comprising the Units, including whether and
under what circumstances those securities may be held or transferred separately;
any provisions of any governing Unit Agreement that differ from those described
below; and any provisions for the issuance, payment, settlement, transfer or
exchange of the Units or of the securities comprising the Units. The provisions
described in this section, as well as those described under Description of
Common Shares, Description of Warrants and Description of Debt Securities
will apply to each Unit and to any Common Share, Warrant or Debt Security
included in each Unit, respectively.
Issuance in Series
The Company may issue Units in such amounts and in numerous
distinct series as the Company may determine.
Enforceability of Rights by Holders of Units
Each Unit Agent will act solely as the Companys agent under
any applicable Unit Agreement and will not assume any obligation or relationship
of agency or trust with any holder of any Unit. A single trust company may act
as a Unit Agent for more than one series of Units. A Unit Agent will have no
duty or responsibility in case of any default by us under any applicable Unit
Agreement or Unit, including any duty or responsibility to initiate any
proceedings at law or otherwise, or to make any demand upon us. Any holder of a
Unit may, without the consent of any related Unit Agent or the holder of any
other Unit, enforce by appropriate legal action its rights as holder under any
security included in the Unit. The Company, any Unit Agents, and any of the
Companys or their agents may treat the registered holder of any Unit
certificate as an absolute owner of the Units evidenced by that certificate for
any purpose and as the person entitled to exercise the rights attaching to the
Units so requested, despite any notice to the contrary.
DENOMINATIONS, REGISTRATION AND TRANSFER
The Securities will be issued in fully registered form without
coupons attached in either global or definitive form and in denominations and
integral multiples as set out in the applicable Prospectus Supplement. Other
than in the case of book-entry-only Securities, Securities may be presented for
registration of transfer (with the form of transfer endorsed thereon duly
executed) in the city specified for such purpose at the office of the registrar
or transfer agent designated by the Company for such purpose with respect to any
issue of Securities referred to in the Prospectus Supplement. No service charge
will be made for any transfer, conversion or exchange of the Securities but the
Company may require payment of a sum to cover any transfer tax or other
governmental charge payable in connection therewith. Such transfer, conversion
or exchange will be effected upon such registrar or transfer agent being
satisfied with the documents of title and the identity of the person making the
request. If a Prospectus Supplement refers to any registrar or transfer agent
designated by the Company with respect to any issue of Securities, the Company
may at any time rescind the designation of any such registrar or transfer agent
and appoint another in its place or approve any change in the location through
which such registrar or transfer agent acts.
In the case of book-entry-only Securities, a global certificate
or certificates representing the Securities will be held by a designated
depositary for its participants. The Securities must be purchased or transferred
through such participants, which includes securities brokers and dealers, banks
and trust companies. The depositary will establish and maintain book-entry accounts for its participants acting on
behalf of holders of the Securities. The interests of such holders of Securities
will be represented by entries in the records maintained by the participants.
Holders of Securities issued in book-entry-only form will not be entitled to
receive a certificate or other instrument evidencing their ownership thereof,
except in limited circumstances. Each holder will receive a customer
confirmation of purchase from the participants from which the Securities are
purchased in accordance with the practices and procedures of that participant
21
PLAN OF DISTRIBUTION
The Company may sell the Securities to or through underwriters
or dealers, and also may sell Securities to one or more other purchasers
directly or through agents, including sales pursuant to ordinary brokerage
transactions and transactions in which a broker-dealer solicits purchasers.
Underwriters may sell Securities to or through dealers. Each Prospectus
Supplement will set forth the terms of the offering, including the name or names
of any underwriters, dealers or agents and any fees or compensation payable to
them in connection with the offering and sale of a particular series or issue of
Securities, the public offering price or prices of the Securities and the
proceeds to the Company from the sale of the Securities.
The Securities may be sold, from time to time in one or more
transactions at a fixed price or prices which may be changed or at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices, including sales in transactions that are deemed
to be at-the-market distributions as defined in National Instrument
44-102Shelf Distributions, including sales made directly on the TSX, NYSE or
other existing trading markets for the Securities. The prices at which the
Securities may be offered may vary as between purchasers and during the period
of distribution. If, in connection with the offering of Securities at a fixed
price or prices, the underwriters have made a bona fide effort to sell all of
the Securities at the initial offering price fixed in the applicable Prospectus
Supplement, the public offering price may be decreased and thereafter further
changed, from time to time, to an amount not greater than the initial public
offering price fixed in such Prospectus Supplement, in which case the
compensation realized by the underwriters will be decreased by the amount that
the aggregate price paid by purchasers for the Securities is less than the gross
proceeds paid by the underwriters to the Company.
Underwriters, dealers and agents who participate in the
distribution of the Securities may be entitled under agreements to be entered
into with the Company to indemnification by the Company against certain
liabilities, including liabilities under the U.S. Securities Act and Canadian
securities legislation, or to contribution with respect to payments which such
underwriters, dealers or agents may be required to make in respect thereof. Such
underwriters, dealers and agents may be customers of, engage in transactions
with, or perform services for, the Company in the ordinary course of business.
In connection with any offering of Securities, other than an
at-the-market distribution, the underwriters may over-allot or effect
transactions which stabilize or maintain the market price of the Securities
offered at a level above that which might otherwise prevail in the open market.
Such transactions, if commenced, may be discontinued at any time.
Unless otherwise specified in the applicable Prospectus
Supplement, the Company does not intend to list any of the Securities other than
the Common Shares on any securities exchange. Any underwriters, dealers or
agents to or through which Securities other than the Common Shares are sold by
the Company for public offering and sale may make a market in such Securities,
but such underwriters, dealers or agents will not be obligated to do so and may
discontinue any such market making at any time and without notice. No assurance
can be given that a market for trading in Securities of any series or issue will
develop or as to the liquidity of any such market, whether or not the Securities
are listed on a securities exchange.
22
PRIOR SALES
The following table sets out details of Common Shares issued by
the Company during the 12 months prior to the date of this Prospectus.
|
|
Number of
|
|
Price per
|
|
|
Date
|
|
Common Shares
|
|
Common Share
|
|
Reason for issuance
|
April 12, 2017
|
|
193,825
|
|
US$2.27
|
|
Performance Shares
|
June 5, 2017
|
|
154,321
|
|
US$3.24
|
|
Zacatecas Property Acquisition
|
October 5, 2017
|
|
32,000
|
|
US$2.65
|
|
Stock Option Exercise
|
The following table sets out details of all securities
convertible or exercisable into Common Shares that were issued or granted by the
Company during the 12 months prior to the date of this Prospectus.
|
|
|
|
Number of Common Shares
|
|
|
|
|
|
|
issuable upon exercise or
|
|
Exercise or conversion
|
Date
|
|
Type of Security Issued
|
|
conversion
|
|
price per Common Share
|
May 4, 2017
|
|
Stock options
|
|
1,572,000
|
|
$4.32
|
May 4, 2017
|
|
Performance share units
|
|
200,000
(1)
|
|
N/A
|
________________________________
(1)
|
Under the Companys Performance Share Unit Plan, vested
performance share units are redeemable, at the election of the Board of
Directors of the Company in its discretion, for Common Shares (generally
on a one-for-one basis), a cash payment equal to the market value of a
Common Share (generally on a one-for-one basis) as of the redemption date
or a combination of cash or Common Shares.
|
TRADING PRICE AND VOLUME
The Common Shares are listed for trading on the TSX under the
symbol EDR and on the NYSE under the symbol EXK.
The following table sets forth the trading price range and
volumes of the Common Shares for the periods indicated on the TSX, the Canadian
marketplace on which the greatest volume of trading or quotation for the Common
Shares generally occurs.
|
|
High
|
|
Low
|
|
|
Month
|
|
(Cdn.$)
|
|
(Cdn.$)
|
|
Volume
|
March 2017
|
|
5.88
|
|
3.85
|
|
11,428,453
|
April 2017
|
|
4.97
|
|
3.75
|
|
9,047,025
|
May 2017
|
|
4.62
|
|
3.81
|
|
8,195,226
|
June 2017
|
|
4.22
|
|
3.73
|
|
6,775,025
|
July 2017
|
|
3.95
|
|
3.55
|
|
4,294,158
|
August 2017
|
|
3.86
|
|
2.64
|
|
6,626,521
|
September 2017
|
|
3.35
|
|
2.87
|
|
5,652,202
|
October 2017
|
|
3.41
|
|
2.66
|
|
4,002,332
|
November 2017
|
|
2.94
|
|
2.50
|
|
4,460,349
|
December 2017
|
|
3.20
|
|
2.56
|
|
3,834,156
|
January 2018
|
|
3.42
|
|
2.84
|
|
6,901,832
|
February 2018
|
|
3.05
|
|
2.53
|
|
5,373,232
|
March 2018 (to March 8)
|
|
3.22
|
|
2.72
|
|
1,969,622
|
23
The following table sets forth the trading price range and
volumes of the Common Shares for the periods indicated as reported by the NYSE.
The data includes Common Shares sold through certain quotation systems in the
United States.
|
|
High
|
|
Low
|
|
|
Month
|
|
(US$)
|
|
(US$)
|
|
Volume
|
March 2017
|
|
4.42
|
|
2.84
|
|
64,846,883
|
April 2017
|
|
3.73
|
|
2.76
|
|
53,302,885
|
May 2017
|
|
3.39
|
|
2.80
|
|
57,605,300
|
June 2017
|
|
3.22
|
|
2.80
|
|
51,025,975
|
July 2017
|
|
3.12
|
|
2.75
|
|
27,591,565
|
August 2017
|
|
3.10
|
|
2.08
|
|
48,858,854
|
September 2017
|
|
2.71
|
|
2.33
|
|
32,763,610
|
October 2017
|
|
2.75
|
|
2.06
|
|
31,773,670
|
November 2017
|
|
2.29
|
|
1.94
|
|
37,285,924
|
December 2017
|
|
2.53
|
|
2.38
|
|
25,033,813
|
January 2018
|
|
2.699
|
|
2.295
|
|
33,663,164
|
February 2018
|
|
2.445
|
|
2.00
|
|
24,441,174
|
March 2018 (to March 8)
|
|
2.51
|
|
2.12
|
|
7,673,141
|
CERTAIN INCOME TAX CONSIDERATIONS
The applicable Prospectus Supplement will describe certain
Canadian federal income tax consequences to investors described therein of
acquiring Securities, including, in the case of an investor who is not a
resident of Canada (for purposes of the Income Tax Act (Canada)), if applicable,
whether payment of principal, premium, if any, and interest will be subject to
Canadian non-resident withholding tax.
The applicable Prospectus Supplement will also describe certain
United States federal income tax consequences of the acquisition, ownership and
disposition of Securities by an initial investor who is a U.S. person (within
the meaning of the United States Internal Revenue Code), if applicable,
including, to the extent applicable, any such consequences relating to
Securities payable in a currency other than the United States dollar, issued at
an original issue discount for United States federal income tax purposes or
containing early redemption provisions or other special terms.
LEGAL MATTERS
Certain legal matters in connection with the Securities offered
hereby will be passed upon on behalf of the Company by Koffman Kalef LLP with
respect to Canadian legal matters and by Dorsey & Whitney LLP with respect
to United States legal matters.
INTEREST OF EXPERTS
Information regarding experts is contained in the Companys
AIF.
RISK FACTORS
Investing in securities of the Company involves a
significant degree of risk and must be considered speculative due to the
high-risk nature of the Companys business. Investors should carefully consider
the information included or incorporated herein by reference in this Prospectus
and the Companys historical consolidated financial statements and related notes
thereto before making an investment decision concerning the Securities. There
are various risks, including those discussed in the Companys AIF, which are
incorporated herein by reference, that could have a material
adverse effect on, among other things, the operating results, earnings,
properties, business and condition (financial or otherwise) of the Company.
These risk factors, together with all of the other information included, or
incorporated by reference in this Prospectus, including information contained in
the section entitled Cautionary Note Regarding Forward-Looking Statements
should be carefully reviewed and considered before a decision to invest in the
Securities is made. Additional risks and uncertainties not currently known to
the Company, or that the Company currently deems immaterial, may also materially
and adversely affect its business. In addition, risks relating to a particular
offering of Securities will be set out in a Prospectus Supplement relating to
such offering.
24
DOCUMENTS INCORPORATED BY REFERENCE
Information has been incorporated by reference in this
Prospectus from documents filed with securities commissions or similar
authorities in Canada, which have also been filed with, or furnished to, the
SEC.
Copies of the documents incorporated herein by reference may be
obtained on request without charge from the Chief Financial Officer of the
Company at 1130-609 Granville Street, Vancouver, British Columbia V7Y 1G5,
telephone: (604) 685-9775. These documents are also available through the
internet on SEDAR (www.sedar.com) and on EDGAR (accessed at www.sec.gov).
The following documents of the Company, filed with the
securities regulatory authorities in the jurisdictions in Canada in which the
Company is a reporting issuer, are specifically incorporated by reference into,
and form an integral part of, this Prospectus:
1.
|
the annual information form of the Company dated February
22, 2018 for the year ended December 31, 2017 (the
AIF
), filed
February 26, 2018;
|
|
|
2.
|
the audited annual consolidated financial statements of
the Company for the years ended December 31, 2017 and 2016 and the
auditors report thereon, filed February 26, 2018;
|
|
|
3.
|
the managements discussion and analysis of the Company
for the year ended December 31, 2017, filed February 26, 2018 (the
Annual MD&A
); and
|
|
|
4.
|
the information circular dated March 20, 2017 with
respect to the Companys annual general meeting of shareholders held on
May 3, 2017, filed March 24, 2017.
|
All documents of the type referred to in section 11.1 of Form
44-101F1 of National Instrument 44-101Short Form Prospectus Distributions filed
by the Company with the securities commissions or similar regulatory authorities
in the applicable provinces of Canada after the date of this Prospectus, and
before the termination of the Offering, are deemed to be incorporated by
reference into this Prospectus.
In addition, to the extent that any document or information
incorporated by reference into this Prospectus is included in any report filed
with or furnished to the SEC pursuant to the United States Securities Exchange
Act of 1934, as amended (the
U.S. Exchange Act
), after the date of this
Prospectus, such document or information shall be deemed to be incorporated by
reference as an exhibit to the registration statement of which this Prospectus
forms a part (in the case of documents or information deemed furnished on Form
6-K or Form 8-K, only to the extent specifically stated therein).
Any statement contained in this Prospectus or in a document
incorporated or deemed to be incorporated by reference in this Prospectus shall
be deemed to be modified or superseded for the purposes of this Prospectus to
the extent that a statement contained herein or in any subsequently filed
document that also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. The modifying or superseding statement
need not state that it has modified or superseded a prior statement or include
any other information set forth in the document that contains the statement that
it modifies or supersedes. The making of such a modifying or superseding
statement shall not be deemed an admission for any purposes that the modified or
superseded statement, when made, constituted a misrepresentation, an untrue
statement of a
material fact or an omission to state a material fact that
is required to be stated or that is necessary to make a statement not misleading
in light of the circumstances in which it was made. Any statement so modified or
superseded shall not constitute a part of this Prospectus, except as so modified
or superseded.
25
A Prospectus Supplement containing the specific terms of an
offering of Securities will be delivered to purchasers of such Securities
together with this Prospectus and will be deemed to be incorporated by reference
into this Prospectus as of the date of such Prospectus Supplement, but only for
the purposes of the offering of Securities covered by that Prospectus
Supplement.
Upon a new annual information form and related annual financial
statements being filed by us with, and where required, accepted by, the
applicable securities regulatory authority during the currency of this
Prospectus, the previous annual information form, the previous annual financial
statements and all interim financial statements, material change reports and
information circulars and all Prospectus Supplements filed prior to the
commencement of the Companys financial year in which a new annual information
form is filed shall be deemed no longer to be incorporated into this Prospectus
for purposes of future offers and sales of Securities hereunder.
DOCUMENTS FILED AS PART OF THE REGISTRATION STATEMENT
The following documents have been or will be filed with the SEC
as part of the registration statement of which this Prospectus forms a part: (i)
the documents set out under the heading Documents Incorporated by Reference;
(ii) the consents of the Companys auditor, legal counsel and technical report
authors; (iii) the powers of attorney from the directors and certain officers of
the Company; and (iv) the form of indenture for Debt Securities. A copy of the
form of debt or warrant indenture, subscription receipt agreement or statement
of eligibility of trustee on Form T-1, as applicable, will be filed by
post-effective amendment or by incorporation by reference to documents filed or
furnished with the SEC under the U.S. Exchange Act.
ADDITIONAL INFORMATION
The Company has filed with the SEC a registration statement on
Form F-10 relating to the Securities. This Prospectus, which constitutes a part
of the registration statement, does not contain all of the information contained
in the registration statement, certain items of which are contained in the
exhibits to the registration statement as permitted by the rules and regulations
of the SEC. See
Documents Filed as Part of the Registration Statement
.
Statements included or incorporated by reference in this Prospectus about the
contents of any contract, agreement or other documents referred to are not
necessarily complete, and in each instance you should refer to the exhibits for
a more complete description of the matter involved. Each such statement is
qualified in its entirety by such reference. Each time we sell Securities under
the registration statement, we will provide a Prospectus Supplement that will
contain specific information about the terms of that offering. The Prospectus
Supplement may also add to, update or change information contained in this
Prospectus.
The Company is subject to the information requirements of the
U.S. Exchange Act and applicable Canadian securities legislation and, in
accordance therewith, files and furnishes annual and quarterly financial
information and material change reports, business acquisition reports and other
material with the securities commission or similar regulatory authority in each
of the provinces of Canada and with the SEC. Under MJDS adopted by the United
States and Canada, documents and other information that the Company files with
the SEC may be prepared in accordance with the disclosure requirements of
Canada, which are different from those of the United States. As a foreign
private issuer within the meaning of rules made under the U.S. Exchange Act, the
Company is exempt from the rules under the U.S. Exchange Act prescribing the
furnishing and content of proxy statements, and the Companys officers,
directors and principal shareholders are exempt from the reporting and
shortswing profit recovery provisions contained in Section 16 of the U.S.
Exchange Act. In addition, the Company is not required to publish financial
statements as promptly as United States companies.
You may read any document that the Company has filed with the
SEC on the SECs website at www.sec.gov/edgar.shtml (EDGAR) and such information
can also be inspected and copies ordered at the SECs public reference room in
Washington, D.C. You may also obtain copies of those documents from the public
reference room of the SEC at 100 F Street, N.E., Washington,
D.C. 20549 by paying a fee. You should call the SEC at 1-800-SEC-0330 or access
its website at www.sec.gov for further information about the public reference
rooms. You may read and download any public document that the Company has filed
with the Canadian securities regulatory authorities under the Companys profile
on the SEDAR website at www.sedar.com.
26
ENFORCEABILITY OF CIVIL LIABILITIES AGAINST NON-U.S. PERSONS
The Company is a corporation existing under the Business
Corporations Act (British Columbia). Most of the Companys directors and
officers, and some or all of the experts named in this Prospectus, are residents
of Canada or otherwise reside outside the United States, and all or a
substantial portion of their assets, and substantially all of the Companys
assets, are located outside the United States. The Company has appointed an
agent for service of process in the United States, but it may be difficult for
holders of Common Shares who reside in the United States to effect service
within the United States upon those directors, officers and experts who are not
residents of the United States. It may also be difficult for holders of Common
Shares who reside in the United States to realize in the United States upon
judgments of courts of the United States predicated upon the Companys civil
liability and the civil liability of its directors, officers and experts under
the United States federal securities laws.
The Company filed with the SEC, concurrently with its
registration statement on Form F-10 of which this Prospectus is a part, an
appointment of agent for service of process on Form F-X. Under the Form F-X, the
Company appointed DL Services Inc. as its agent for service of process in the
United States in connection with any investigation or administrative proceeding
conducted by the SEC, and any civil suit or action brought against or involving
the Company in a United States court arising out of or related to or concerning
the offering of the Securities under this Prospectus.
27
PART II
INFORMATION NOT REQUIRED TO BE DELIVERED TO OFFEREES OR
PURCHASERS
INDEMNIFICATION
Section 160 of the
Business Corporations Act
(British
Columbia) (the "BCBCA") authorizes a company to indemnify past and present
directors and officers of the company and past and present directors and
officers of a corporation of which the company is or was a shareholder, against
liabilities incurred in connection with the provision of their services as such
if the director or officer acted honestly and in good faith with a view to the
best interests of the company and, in the case of a criminal or administrative
proceeding, if he or she had reasonable grounds for believing that his or her
conduct was lawful. Section 165 of the BCBCA provides that a company may
purchase and maintain liability insurance for the benefit of such directors and
officers.
Under Endeavour Silver Corp.s (for purposes of this
discussion, the Company) articles and subject to the provisions of the BCBCA,
the Company shall indemnify a director, former director or alternate director of
the Company and his or her heirs and legal personal representatives against all
judgments, penalties or fines awarded or imposed in, or an amount paid in
settlement of, a legal proceeding or investigative action, whether current,
threatened, pending or completed, in which such director, former director or
alternate director of the Company, or any of his or her heirs and legal personal
representatives, by reason of having been a director or alternate director of
the Company, is or may be joined as a party, or is or may be liable for or in
respect of a judgment, penalty or fine in, or expenses related to, the
proceeding.
Under the Companys articles and subject to any restrictions in
the BCBCA, the Company may indemnify any other person, including the officers,
former officers and alternate officers of the Company.
A policy of directors' and officers' liability insurance is
maintained by the Company which insures directors and officers against losses
incurred as a result of claims against the directors and officers of the Company
in the indemnity provisions under the Articles and the BCBCA.
Insofar as indemnification for liabilities arising under the
United States Securities Act of 1933, as amended (the Securities Act) may be
permitted to directors, officers or persons controlling the Company pursuant to
the foregoing provisions, the Company has been informed that in the opinion of
the U.S. Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act and is therefore unenforceable.
II-
1
EXHIBITS
Exhibit
|
|
|
Number
|
|
Description
|
|
|
|
4.1*
|
|
Annual Information Form of the Registrant for the year
ended December 31, 2017, dated February 22, 2018 (incorporated by
reference to exhibit 99.1 to the Registrants annual report on Form 40-F,
filed with the Commission on February 26, 2018)
|
|
|
|
4.2*
|
|
Audited amended annual consolidated financial statements
of the Registrant as at and for the years ended December 31, 2017 and 2016
and the notes thereto together with report of the Independent Registered
Public Accounting Firm thereon and the report of the Independent
Registered Public Accounting Firm regarding its attestation on internal
control over financial reporting (incorporated by reference to exhibit
99.3 to the Registrants annual report on Form 40-F, filed with the
Commission on February 26, 2018 and exhibit 99.2 to the Registrants
annual report on Form 40-F/A (Amendment No.1), filed with the Commission
on March 8, 2018)
|
|
|
|
4.3*
|
|
Managements discussion and analysis of financial
condition and results of operations of the Registrant for the years ended
December 31, 2017 and 2016 (incorporated by reference to exhibits 99.4 to
the Registrants annual report on Form 40-F, filed with the Commission on
February 26, 2016)
|
|
|
|
4.4*
|
|
Information circular dated March 20, 2017 with respect to
the Registrants annual general meeting of shareholders held on May 3,
2017 (incorporated by reference to exhibit 99.4 to the Registrants
Current Report on Form 6-K, furnished to the Commission on March 24, 2017)
|
|
|
|
5.1**
|
|
Consent of KPMG LLP
|
|
|
|
5.2**
|
|
Consent of Koffman Kalef LLP
|
|
|
|
5.3**
|
|
Consent
of Peter J. Smith, P. Eng. of Smith Foster & Associates
|
|
|
|
5.4**
|
|
Consent
of Scott Fleming, P.E. of Amec Foster Wheeler Environment and
Infrastructure
|
|
|
|
5.5**
|
|
Consent
of Jarita Barry, P. Geo. of P&E Mining Consultants Inc.
|
|
|
|
5.6**
|
|
Consent
of David Burga, P. Geo. of P&E Mining Consultants Inc.
|
|
|
|
5.7**
|
|
Consent
of Eugene Puritch, P. Geo., FEC, of P&E Mining Consultants Inc.
|
|
|
|
5.8**
|
|
Consent
of James L. Pearson, P. Eng. of P&E Mining Consultants Inc.
|
|
|
|
5.9**
|
|
Consent
of Yungang Wu, P. Geo. of P&E Mining Consultants Inc.
|
|
|
|
5.10**
|
|
Consent
of Eugenio Iasillo P. E. of Process Engineering L.L.C
|
|
|
|
5.11**
|
|
Consent of Ben
Peacock, P. Eng. of Knight Piesold Ltd.
|
|
|
|
5.12**
|
|
Consent of Ken
Embree, P. Eng. of Knight Piesold Ltd.
|
|
|
|
5.13**
|
|
Consent
of Deepak Malhotra, Ph.D. of Resource Development Inc
|
|
|
|
5.14**
|
|
Consent
of Godfrey Walton, P.Geo. of Endeavour Silver Corp.
|
|
|
|
5.15**
|
|
Consent
of Jeffery W. Choquette, P.E. of Hard Rock Consulting
|
|
|
|
5.16**
|
|
Consent of
Zachary J. Black, SME-RM of Hard Rock Consulting
|
|
|
|
5.17**
|
|
Consent
of Jennifer J. Brown, SME-RM of Hard Rock Consulting
|
|
|
|
6.1**
|
|
Powers
of Attorney (included on the signature pages of this Registration
Statement)
|
II-
2
II-
3
PART III
UNDERTAKING AND CONSENT TO SERVICE OF PROCESS
The Registrant undertakes to make available, in person or by
telephone, representatives to respond to inquiries made by the Commission staff,
and to furnish promptly, when requested to do so by the Commission staff,
information relating to the securities registered pursuant to this Form F-10 or
to transactions in said securities.
Item 2.
|
Consent to Service of Process
|
|
(a)
|
Concurrently with the filing of this Registration
Statement on Form F-10, the Registrant is filing with the Commission a
written irrevocable consent and power of attorney on Form F-X.
|
|
|
|
|
(b)
|
Any change to the name or address of the agent for
service of the Registrant will be communicated promptly to the Commission
by amendment to Form F-X referencing the file number of this Registration
Statement.
|
III-
1
SIGNATURES
Pursuant to the requirements of the Securities Act, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form F-10 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Vancouver, Province of British Columbia, Canada,
on March 9, 2018.
ENDEAVOUR SILVER CORP.
|
|
|
By:
|
/s/ Bradford J. Cooke
|
|
|
|
|
|
Bradford J. Cooke
|
|
Chief Executive Officer
|
POWERS OF ATTORNEY
Each person whose signature appears below constitutes and
appoints Bradford J. Cooke and Daniel Dickson, and each of them, either of whom
may act without the joinder of the other, as his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
or all amendments (including post-effective amendments) to this Registration
Statement and registration statements filed pursuant to Rule 429 under the
Securities Act, and to file the same, with all exhibits thereto and other
documents in connection therewith, with the U.S. Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, each acting alone,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, each acting alone, or their substitute or
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed by or on behalf of the following persons
in the capacities indicated on March 9, 2018:
Signature
|
|
Title
|
|
|
|
/s/ Bradford J. Cooke
|
|
|
|
|
Chief Executive Officer
|
Bradford J. Cooke
|
|
(Principal Executive Officer)
|
/s/ Daniel Dickson
|
|
|
|
|
Chief Financial Officer
|
Daniel Dickson
|
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
|
|
/s/ Ricardo M.
Campoy
|
|
|
Ricardo M. Campoy
|
|
Director
|
|
|
|
/s/ Geoffrey A. Handley
|
|
|
|
|
Director
|
Geoffrey A. Handley
|
|
|
|
|
|
/s/ Rex. J. McLennan
|
|
|
|
|
Director
|
Rex J. McLennan
|
|
|
III-
2
/s/ Kenneth Pickering
|
|
|
|
|
Director
|
Kenneth Pickering
|
|
|
|
|
|
/s/ Mario D. Szotlender
|
|
|
|
|
Director
|
Mario D. Szotlender
|
|
|
|
|
|
/s/ Godfrey J. Walton
|
|
|
|
|
Director
|
Godfrey J. Walton
|
|
|
III-
3
AUTHORIZED REPRESENTATIVE
Pursuant to the requirements of Section 6(a) of the Securities
Act of 1933, the Authorized Representative has signed this Registration
Statement, solely in his capacity as the duly authorized representative of
Endeavour Silver Corp. in the United States, in the State of New York, on March
9, 2018.
/s/ Ricardo Campoy
|
|
|
Name: Ricardo Campoy
|
Title: Director
|
III-
4
Endeavour Silver (NYSE:EXK)
Historical Stock Chart
From Mar 2024 to Apr 2024
Endeavour Silver (NYSE:EXK)
Historical Stock Chart
From Apr 2023 to Apr 2024