RNS Number:8677H
Moydow Mines International Inc
18 August 2006
MOYDOW MINES INTERNATIONAL INC.
NOTICE of ANNUAL and SPECIAL MEETING of SHAREHOLDERS
NOTICE IS HEREBY GIVEN THAT an annual general and special meeting (the
"Meeting") of shareholders of Moydow Mines International Inc. (the
"Corporation") will be held at the Royal Meridien King Edward Hotel, 37 King
Street East, Toronto, Ontario on Thursday, the 31th day of August 31, 2006 at
the hour of 4:00 in the afternoon (Toronto time), for the following purposes:
(1) To receive and consider the audited consolidated financial statements of
the Corporation for the financial year ended December 31, 2005, together
with the auditors' report thereon;
(2) To elect directors of the Corporation;
(3) To reappoint PricewaterhouseCoopers LLP, Chartered Accountants, as the
auditors of the Corporation to hold office until the close of the next
annual meeting of shareholders of the Corporation, and to authorize the
directors of the Corporation to fix the auditors' remuneration;
(4) To continue the Corporation under the laws of the province of British
Columbia; and
(5) To transact such other business as properly may be brought before the
Meeting or any adjournment or adjournments thereof.
The specific details of the matters to be put before the Meeting as identified
above are set forth in the Management Information Circular of the Corporation
accompanying and forming part of this notice.
The audited consolidated financial statements of the Corporation for the
financial year ended December 31, 2005, together with the auditors' report
thereon, are enclosed with this notice.
This notice and the accompanying circular have been sent to each director of the
Corporation, each shareholder of the Corporation entitled to notice of the
Meeting and to the auditors of the Corporation.
Shareholders who are unable to attend the Meeting in person are requested to
sign and return the enclosed form of proxy to the Corporation c/o Computershare
Trust Company of Canada, 100 University Avenue, 8th Floor, Toronto, Ontario,
Canada M5J 2Y1.
DATED at Toronto, Ontario, the 27th day of July, 2006.
BY ORDER OF THE BOARD
("signed")
__________________________
Michael E. Power
Vice President & Secretary
NOTE:.... The directors have fixed the hour of 4:00 p.m. (Toronto time) on the
29th day of August, 2006 before which time the instrument of proxy to be used at
the Meeting must be deposited with the Corporation c/o Computershare Trust
Company of Canada, 100 University Avenue, 8th Floor, Toronto, Ontario, Canada
M5J 2Y1, provided that a proxy may be delivered to the Chairman of the Meeting
on the day of the Meeting or any adjournment thereof prior to the time for
voting.
MOYDOW MINES INTERNATIONAL INC.
MANAGEMENT INFORMATION CIRCULAR
SOLICITATION OF PROXIES
This Management Information Circular (the "Circular") is furnished in connection
with the solicitation of proxies by the management of MOYDOW MINES INTERNATIONAL
INC. (the "Corporation") for use at the annual and special meeting of
shareholders of the Corporation (the "Meeting") to be held at the time and place
and for the purposes set forth in the attached notice of annual and special
meeting of shareholders (the "Notice"). It is expected that the solicitation
will be by mail primarily, but proxies may also be solicited personally by
directors and officers of the Corporation. The cost of such solicitation will
be borne by the Corporation.
APPOINTMENT, REVOCATION AND DEPOSIT OF PROXIES
The persons named in the enclosed form of proxy are directors of the
Corporation.
A SHAREHOLDER HAS THE RIGHT TO APPOINT A PERSON (WHO NEED NOT BE A SHAREHOLDER)
TO ATTEND AND ACT FOR HIM OR HER AND ON HIS OR HER BEHALF AT THE MEETING OTHER
THAN THE PERSONS DESIGNATED IN THE ENCLOSED FORM OF PROXY. SUCH RIGHT MAY BE
EXERCISED BY STRIKING OUT THE NAMES OF THE PERSONS DESIGNATED IN THE FORM OF
PROXY AND BY INSERTING IN THE BLANK SPACE PROVIDED FOR THAT PURPOSE THE NAME OF
THE DESIRED PERSON OR BY COMPLETING ANOTHER PROPER FORM OF PROXY AND, IN EITHER
CASE, DELIVERING THE COMPLETED AND EXECUTED PROXY TO THE CORPORATION c/o
COMPUTERSHARE TRUST COMPANY OF CANADA, 100 UNIVERSITY AVENUE, 8TH FLOOR,
TORONTO, ONTARIO, CANADA M5J 2Y1, AT ANY TIME PRIOR TO 4:00 P.M. (TORONTO TIME)
ON TUESDAY, THE 29TH DAY OF AUGUST, 2006.
A shareholder forwarding the enclosed form of proxy may indicate the manner in
which the appointee is to vote with respect to any specific item by checking the
appropriate space. If the shareholder giving the proxy wishes to confer a
discretionary authority with respect to any item of business, then the space
opposite the item is to be left blank. The shares represented by the proxy
submitted by a shareholder will be voted in accordance with the directions, if
any, given in the proxy.
A shareholder who has given a proxy may revoke it at any time in so far as it
has not been exercised. A proxy may be revoked, as to any matter on which a
vote shall not already have been cast pursuant to the authority conferred by
such proxy, by instrument in writing executed by the shareholder or by his or
her attorney authorized in writing or, if the shareholder is a body corporate,
by an officer or attorney thereof duly authorized, and deposited at the
registered office of the Corporation at any time prior to 4:00 p.m. (Toronto
time) on the last business day preceding the day of the Meeting, or any
adjournment thereof, or with the Chairman of the Meeting on the day of the
Meeting or any adjournment thereof, and upon either of such deposits the proxy
is revoked. A proxy may also be revoked in any other manner permitted by law.
The Corporation's registered office is located at Suite 1220, 20 Toronto Street,
Toronto, Ontario, Canada M5C 2B8.
MANNER OF VOTING AND EXERCISE OF DISCRETION BY PROXIES
The persons named in the enclosed form of proxy will vote or withhold from
voting the common shares in respect of which they are appointed in accordance
with the direction of the shareholders appointing them. In the absence of such
direction, such common shares will be voted FOR each of the matters identified
in the Notice and described in this Circular.
The enclosed form of proxy confers discretionary authority upon the persons
named therein with respect to amendments or variations to matters identified in
the Notice, and with respect to other matters which may properly come before the
Meeting. At the time of the printing of this Circular, management of the
Corporation knows of no such amendments, variations or other matters to come
before the Meeting other than the matters referred to in the Notice.
VOTING SHARES AND PRINCIPAL HOLDERS THEREOF
The authorized share capital of the Corporation consists of an unlimited number
of common shares and an unlimited number of preferred shares, issuable in
series, of which 30,620,575 common shares of the Corporation and no preferred
shares of the Corporation are issued and outstanding. Each common share
entitles the holder thereof to one vote at all meetings of shareholders of the
Corporation, except for meetings at which only holders of another specified
class or series of shares of the Corporation are entitled to vote separately as
a class or series.
All shareholders of record at the close of business on July 31, 2006 will be
entitled either to attend and vote at the Meeting in person the shares held by
them or, provided a completed and executed proxy shall have been delivered to
the Corporation as described above, to attend and vote thereat by proxy the
shares held by them. However, if a shareholder has transferred any shares after
July 31, 2006 and the transferee of such shares establishes ownership thereof
and makes a written demand, not later than ten days before the Meeting, to be
included in the list of shareholders entitled to vote at the Meeting, the
transferee will be entitled to vote such shares.
To the knowledge of the directors and senior officers of the Corporation, no
person or company beneficially owns, directly or indirectly, or exercises
control or direction over more than ten percent (10%) of the issued and
outstanding common shares of the Corporation other than the following:
Name and Number of Total of
Municipality of Residence Common Shares Common Shares
Brian P. Kiernan(1) 4,493,967 14.7%
Dublin, Ireland
(1) Mr. Kiernan, who is the President and CEO of the Company (see "Election of
Directors"), holds 535,000 of these shares directly, 3,654,608
indirectly through Stanley Secretarial Services Limited, a corporation in which
he and certain members of his family own a controlling interest but in which he
does not exercise control, and 304,359 indirectly through Pontil Minerex
Limited, a corporation in which he and certain members of his family own
interests but in which he does not exercise control. Past disclosure of the
shares beneficially owned or controlled by Mr. Kiernan included all shares held
by Stanley Secretarial Services Limited and Pontil Minerex Limited. If Mr.
Kiernan controlled both of those companies, he would control 10,901,560 common
shares of the Corporation, representing 35.6% of the Corporation's issued and
outstanding shares.
ELECTION OF DIRECTORS
The number of directors on the board of directors of the Corporation must
consist of not more than twelve (12) directors and not less than three (3)
directors to be elected annually. The number of directors to be elected at the
Meeting is five (5). Unless otherwise specified, the persons named in the
enclosed form of proxy will vote FOR the election of the nominees whose names
are set forth below. Management of the Corporation does not contemplate that
any of the nominees will be unable to serve as a director, but if that should
occur for any reason prior to the Meeting, the persons named in the enclosed
form of proxy reserve the right to vote for another nominee in their discretion.
Each director elected will hold office until the close of the first annual
meeting of shareholders of the Corporation following his election unless his
office is earlier vacated in accordance with the by-laws of the Corporation.
The following table and the notes thereto set out the name and municipality of
residence of each person proposed to be nominated for election as a director,
his current position and office with the Corporation, his present principal
occupation(s) or employment, the date on which he was first elected or appointed
a director of the Corporation, and the number of common shares of the
Corporation beneficially owned directly or indirectly or over which he exercises
control or direction:
Shares of the
Corporation
Beneficially Owned,
Name, and Municipality of Director Controlled or Directed
Residence Present Principal Occupation(s) Since (1)
Brian P. Kiernan Chief Executive Officer of the Corporation(6) December 9, 1998 10,901,5608)
Dublin, Ireland
Noel P. Kiernan Chairman of the Board of the Corporation(7) December 9, 1998 279,760
and Chairman of the Board of Pontil Minerex
Dublin, Ireland Limited (a drilling company).
Michael E. Power Vice President and Secretary of the December 9, 1998 114,000
Toronto, Ontario Corporation.
Louise President of LVConseils Institutionnels inc. July 27, 2006 Nil
Vaillancourt-Chatillon(2) (9)
(3)(4)
Saint-Laurent, Quebec
Peter Villani2)(3)(4) Partner of Fasken Martineau DuMoulin LLP, July 27, 2006 Nil
Hampstead, Quebec Barristers and Solicitors(5)
(1) The information as to shares beneficially owned, directly or
indirectly, not being within the knowledge of the Corporation, has been
furnished by the respective proposed directors individually.
(2) Member of the Audit Committee of the Corporation.
(3) Member of the Compensation Committee of the Corporation.
(4) Member of the Corporate Governance Committee of the Corporation.
(5) Fasken Martineau DuMoulin LLP acts as counsel to the Corporation.
(6) Brian P. Kiernan is also Chief Executive Officer and a director
of the Corporation's wholly-owned subsidiaries, Haddington Limited (Isle of
Man), Shankill Resources Limited (Isle of Man) and Shankill Resources Limited
(Ghana).
(7) Noel P. Kiernan is also Chairman of the Board and a director of
the Corporation's wholly-owned subsidiaries, Haddington Limited (Isle of Man),
Shankill Resources Limited (Isle of Man) and Shankill Resources Limited (Ghana).
(8) See "Voting Securities and Principal Holders Thereof".
(9) Louise Vaillancourt-Chatillon is also a partner of Fasken Martineau
DuMoulin LLP, Barristers and Solicitors.(5)
APPOINTMENT OF AUDITORS
PricewaterhouseCoopers LLP ("PwC"), Chartered Accountants, are the current
auditors of the Corporation and were first appointed auditors of the Corporation
effective March 4, 2002. Shareholders of the Corporation will be asked at the
Meeting to reappoint PwC as the Corporation's auditors to hold office until the
close of the next annual meeting of shareholders of the Corporation and to
authorize the directors of the Corporation to fix the auditors' remuneration.
Unless otherwise specified, the persons named in the enclosed form of proxy will
vote FOR the said reappointment of PwC as the auditors of the Corporation and
FOR authorizing the directors to fix the remuneration of the auditors.
CHANGE OF INCORPORATION
Moydow Mines International Inc. was incorporated under the laws of the province
of Alberta, Canada, by certificate of incorporation issued December 12, 1972,
continued under the laws of the province of British Columbia on January 16, 1981
by certificate of incorporation and continued under the laws of the province of
Ontario by articles of continuance effective on December 9, 1998. The
Corporation's registered and head office is located at 20 Toronto Street, 12th
Floor, Toronto, Ontario, M5C 2B8. The Corporation also has offices in Dublin,
Ireland, in Accra, Ghana, in Saurimo, Angola and in Freetown, Sierra Leone.
Shareholders will be asked at the Meeting to approve the continuance of the
Corporation under the laws of the province of British Columbia. Under the laws
of the province of Ontario, the majority of the directors of the Corporation
must be Canadian directors, whereas under the Business Corporations Act of the
province of British Columbia, there are no such residency requirements.
Accordingly, management of the Corporation believes that continuing the
Corporation to British Columbia will make it easier for the Corporation to
retain international talent for its board of directors.
The Business Corporations Act (British Columbia) (the "BC Act") and the Business
Corporations Act (Ontario) (the "Ontario Act") are generally similar, although
there are some differences between the two statutes. A table summarizing
certain differences between the BC Act and the Ontario Act that may be
significant to shareholders of the Corporation is attached as Schedule "B" to
this Circular. The summary in Schedule "B" is not intended to be exhaustive.
For a full understanding of the differences and similarities of the BC Act and
the Ontario Act, reference should be made to the text of the two statutes, both
available at hhtp://www.canlii.org/.
Management is of the view that the continuance will not deprive a shareholder of
any right or privilege that such person currently holds as a shareholder.
The complete text of the resolution which management intends to place before the
meeting for approval, confirmation and adoption, with or without modification,
is as follows:
"BE IT RESOLVED as a special resolution that:
(a) the Corporation is authorized to apply to the Director appointed under the
Business Corporations Act (Ontario) for authorization to permit the
Corporation to apply to the director appointed under the Business Corporations
Act (British Columbia) for a Certificate of Continuance continuing the
Corporation as if it had been incorporated under the Business Corporations Act
(British Columbia);
(b) the Corporation is authorized to apply to the Director under the
Business Corporations Act (British Columbia) for a Certificate of Continuance
continuing the Corporation as if it had been incorporated under the Business
Corporations Act (British Columbia);
(c) subject to such continuance and without affecting the validity of
the Corporation and existence of the Corporation by or under its Articles and of
any act done thereunder, its Articles are amended to make all changes necessary
to conform to the Business Corporations Act (British Columbia) by substituting
for the provisions thereof any provisions necessary or desirable to give effect
to this resolution;
(d) the directors of the Corporation are authorized to abandon the
foregoing application without further approval of the shareholders; and
(e) any officer or director of the Corporation is authorized and
directed to do all things and execute all instruments and documents necessary or
desirable to carry out the foregoing."
In order to be effective, this resolution requires the approval of two-thirds of
the votes cast by shareholders who vote in respect of the resolution. Unless
otherwise directed, it is the intention of the person named in the form of proxy
provided by management to vote proxies in which he is the named proxy FOR this
resolution.
Pursuant to section 185(1) of the Ontario Act, a shareholder is entitled to
dissent to the continuance and be paid the fair value of such shareholder's
common shares in the Corporation if the shareholder objects to the continuance
and the continuance is approved, provided that the shareholder strictly complies
with the applicable provisions of the Ontario Act. The rights of dissenting
shareholders are summarized below, and the full text of section 185(1) is
attached as Schedule "C" to this Circular.
Pursuant to section 185(1) of the Ontario Act, a shareholder (here called a "
Dissenting Shareholder") is entitled to dissent to the continuance and be paid
the fair value of his common shares in the Corporation if the shareholder
objects to the continuance and the continuance is approved.
In order to dissent, a Shareholder must (a) send to the Corporation at its
registered office before the Meeting, or deliver to the Chairman at the Meeting,
a written objection (a "Dissent Notice") to the continuance (a proxy to vote
against the resolution does not constitute a written objection thereto); (b)
within 20 days after receipt from the Corporation of notice that the resolution
objected to has been adopted or, if he or she does not receive such notice,
within 20 days after he or she learns that such resolution has been adopted,
send to the Corporation a written notice containing: (i) his or her name and
address, (ii) the number of common shares in respect of which he or she
dissents, (iii) a demand for payment of the fair value of such shares (the "
Demand for Payment"); and (c) within 30 days thereafter, send to the Corporation
the certificates representing such common shares. A Dissenting Shareholder, on
sending the notice containing the Demand for Payment, ceases to have any rights
as a holder of such common shares, other than the right to be paid the fair
value of the common shares, except where the Dissenting Shareholder withdraws
such notice before the Corporation makes an offer to pay for such common shares,
or the Corporation fails to make such an offer to pay for such common shares and
the Dissenting Shareholder withdraws his or her notice, or the directors revoke
the Continuance Resolution, in any of such cases the Dissenting Shareholder's
rights as a holder of such common shares are reinstated as of the day on which
he or she sent the notice containing the Demand for Payment. A Dissenting
Shareholder who fails to forward his or her Dissent Notice, Demand for Payment
or share certificates within the times required loses the right to make a claim
for payment of the fair value of his or her common shares.
The Corporation is required, within 10 days after the adoption of the resolution
to which the Dissenting Shareholder dissented, to send to each holder of common
shares who has filed a Dissent Notice, a notice that such resolution has been
adopted. The Corporation is not required to send such notice to any holder of
common shares who voted for such resolution or who has withdrawn his objection.
The Corporation is also required to send an offer to the Dissenting Shareholder
to pay for his common shares in an amount considered by the directors of the
Corporation to be the fair market value thereof, not more than seven days after
the later of: (i) the completion of the transaction authorized by the resolution
to which the Dissenting Shareholder objected (the "Dissent Effective Date") and
(ii) the date of receipt of the Dissenting Shareholder's Demand for Payment. If
such offer is accepted by the Dissenting Shareholder, payment is required to be
made within 10 days of acceptance. Any such offer lapses if not accepted within
30 days after it is made. If the Corporation fails to make such an offer, or if
the Dissenting Shareholder fails to accept the offer, the Corporation may,
within 50 days after the Dissent Effective Date or such further period as a
court may allow, apply to a court to fix a fair value for the common shares of
the Dissenting Shareholder. If the Corporation fails to make such application,
the Dissenting Shareholder may make a similar application within a further
period of 20 days or such further period as the court may allow.
A Dissenting Shareholder who complies with each of the steps required to dissent
is entitled to be paid the fair value of the common shares held by him in
respect of whom such Dissenting Shareholder dissents, determined as of the close
of business on the day before the resolution approving the continuance is
adopted.
Notwithstanding the foregoing, the Corporation is not permitted to make a
payment to a Dissenting Shareholder if there are reasonable grounds for
believing that:
(i) the Corporation is or would after the payment be unable to pay
its liabilities as they become due; or
(ii) the realizable value of the Corporation's assets would thereby
be less than the aggregate of its liabilities.
A shareholder may only exercise the right to dissent under section 185(1) of the
Ontario Act in respect of common shares which are registered in that
Shareholder's name. Failure by a Dissenting Shareholder to adhere strictly to
the requirements of section 185(1) of the Ontario Act may result in the loss of
such Dissenting Shareholder's rights under that section.
Beneficial shareholders (for example, those persons who hold their common shares
through a broker, custodian, nominee or other intermediary) who wish to exercise
dissent rights should be aware that only registered shareholders are entitled to
dissent. A Beneficial shareholder should ensure that his common shares are
registered in his name prior to the Meeting in order for his dissent to be
properly made. A registered shareholder, such as a broker, who holds common
shares as nominee for several beneficial shareholders, some of whom wish to
dissent, must ensure that such shares are validly registered in the names of
such dissenting persons prior to the Meeting in order to ensure that dissent
rights are not lost.
The foregoing is only a summary of section 185(1) of the Ontario Act, the full
text of which is attached as Schedule "C" to this Circular. Shareholders
considering exercising such right of dissent should specifically refer to
section 185(1) of the Ontario Act. As failure to comply strictly with the
provisions of the statute may prejudice the shareholder's right of dissent, it
is suggested that any shareholder seeking to exercise such right obtain his own
legal advice as to the manner and the implications of exercising such right.
STATEMENT OF EXECUTIVE COMPENSATION
Ontario securities law requires that a "Statement of Executive Compensation" in
accordance with Form 51-102F6 (the "Form") of the Regulation made under the
Securities Act (Ontario) be included in this Circular. The Form prescribes the
disclosure requirements in respect of the compensation of the executive officers
and directors of reporting issuers. The only executive officer of the
Corporation for whom disclosure is required under the Form are Mr. Brian P.
Kiernan, President and Chief Executive Officer of the Corporation.
The following table sets forth certain information with respect to the
compensation of Mr. Kiernan for the three financial years of the Corporation
ended December 31, 2005:
Compensation Table
Long-Term Compensation
Annual Compensation
Other Annual Securities under Options All other
Compensation Granted Compensation
Name Year Ended Salary Bonus
(#)
Brian P. Dec 31, 2005 US$ 125,000 Nil Nil Nil Nil
Kiernan Dec 31, 2004 US$ 125,000 Nil Nil Nil Nil
Dec 31, 2003 US$ 93,344 Nil Nil Nil Nil
Long-Term Incentive Plan Awards
The Corporation did not have a long-term incentive plan within the meaning of
the Form (the definition of "long-term incentive plan" contained in the Form
expressly excludes a stock option plan) during the financial year ended December
31, 2005.
Stock Options
During 2005 the Corporation did not grant any stock options to Mr. Kiernan.
The following table sets forth the value of the stock options of the Corporation
held by Mr. Kiernan as at December 31, 2005.
Value of Unexercised
Unexercised Options in-the-Money
Name at Dec. 31, 2005 Options at Dec. 31, 2005
Brian P. Kiernan 700,000 Cdn$23,000
Stock Option Plan
The Corporation has a stock option plan (the "Plan") the principal purposes of
which are to (a) promote a proprietary interest in the Corporation among the
officers, directors, consultants and employees of the Corporation and its
affiliates, (b) retain and attract the qualified officers, directors,
consultants and employees the Corporation requires, (c) provide a long-term
incentive element in overall compensation, and (d) promote the long-term
profitability of the Corporation. The Plan is considered by the board of
directors of the Corporation (the "Board") to be an important and effective
component of the compensation provided by the Corporation.
The Plan authorizes the Board, or a committee thereof, to grant options from
time to time to officers, directors, consultants and employees of the
Corporation and its affiliates. Options granted under the Plan ("Options") are
non-assignable and may be granted for a term not exceeding ten years. The
number of common shares of the Corporation ("Shares") that may be reserved for
issuance to any one person pursuant to Options must not exceed 5% of the
outstanding Shares. The exercise price of an Option may not be lower than the
closing price of the Shares on the Toronto Stock Exchange on the business day
immediately preceding the date the Option is granted. The Plan provides that
the number of Shares that may be issued pursuant to the exercise of Options
shall not exceed four million. The Corporation did not, during the financial
year ended December 31, 2005, re-price any stock options. In 2005, the
Corporation granted 0.1 million Options to officers, consultants and employees,
exercisable at Cdn$0.23 per Share and expiring five years after the issue.
There are presently outstanding Options to purchase an aggregate of 2.1 million
Shares.
Defined Benefit or Actuarial Plan Disclosure
The Corporation does not have a defined benefit or actuarial plan.
Employment Contract
The Corporation and Brian P. Kiernan entered into an agreement effective January
1, 2001 (the "Brian Kiernan Contract") which sets forth the terms and conditions
upon which Mr. Kiernan performs the services of Chief Executive Officer and
President of the Corporation. Under the Brian Kiernan Contract, Mr. Kiernan's
annual salary for the year 2001 was set at IR#60,000, now 76,200 Euros (which
was approximately US$76,200) and effective January 1, 2004, Mr. Kiernan's annual
salary was set at US$125,000. The Brian Kiernan Contract also provides that, if
Mr. Kiernan's employment is terminated by reason of his death or disability, Mr.
Kiernan (or his family, as the case may be) is entitled to receive from the
Corporation the sum of IR#180,000, now 253,948 Euros (which is currently
approximately US$322,200). If during the period commencing on the date of a
change in the control of the Corporation and ending on the third anniversary
thereof Mr. Kiernan's employment is terminated by the Corporation other than for
"just cause" (as defined in the Brian Kiernan Contract), disability or death or
is terminated by Mr. Kiernan for "good reason" (as defined in the Brian Kiernan
Contract), the Corporation must pay to Mr. Kiernan, within 10 days after the
date of termination, any unpaid salary to the date of termination and, as
compensation for Mr. Kiernan's loss of employment, three times Mr. Kiernan's
then annual salary.
Compensation of Directors
During the financial year ended December 31, 2005, four non-executive directors
of the Corporation were compensated by the Corporation for their services as
members of the committees of the board of the Corporation in the aggregate of
$11,750, in addition to director's fees totaling $24,000. In 2005, the Chairman
was granted no Options and one non-executive director was each granted 100,000
Options exercisable at Cdn$0.23 per Share expiring five years after issue.
The Corporation compensated three executive directors of the Corporation during
the financial year ended December 31, 2005 an aggregate of $235,000 (2004-
$316,182) for services as a consultant or expert. The Corporation's primary
legal counsel is with a firm in which a director of the Corporation is a
partner. During 2005, the Corporation incurred legal expenses of $68,101 (2004
- $49,521).
The Corporation carries directors and officers liability insurance considered
appropriate for its activities.
INDEBTEDNESS OF DIRECTORS AND OFFICERS
No director or officer of the Corporation or associate of any such director or
officer is indebted to the Corporation or its subsidiaries.
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS
Other than as described below, no insider of the Corporation, as defined in the
Securities Act (Ontario), or associate or affiliate of any such insider, has any
material interest in any transaction completed since the commencement of the
Corporation's financial year ended December 31, 2005 or in any proposed
transaction which has materially affected or would materially affect the
Corporation or any of its subsidiaries.
Noel P. Kiernan is the controlling shareholder of Minerex Limited, which
provides certain management, administrative, financial, technical and other
support services to the Corporation. All contracts entered into with Minerex
Limited have been at commercially competitive rates. The Corporation was
charged for these services a total of $251,597 during 2005 (2004 - $492,880).
FINANCIAL STATEMENTS
The audited consolidated financial statements of the Corporation for the
financial year ended December 31, 2005, together with the auditors' report
thereon, are enclosed with this Circular. The directors will place before the
Meeting the said financial statements and auditors' report.
STATEMENT OF CORPORATE GOVERNANCE PRACTICES
The Corporation's common shares are listed on the Toronto Stock Exchange and on
the Alternative Investment Market of the London Stock Exchange. The Board of
Directors has considered the Corporate Governance Guidelines set out in National
Policy 58-201. A description of the Company's practices is attached hereto as
Schedule "A" - "Statement of Corporate Governance Practices".
ADDITIONAL INFORMATION
Additional information relating to the Company is included in its audited
consolidated financial statements and management discussion and analysis for the
year ended December 31, 2005. The annual information form, this information
circular, and any interim financial statements issued subsequent to this
information circular, are on SEDAR at www.sedar.com. Copies may be obtained
without charge upon request from the Secretary of the Company, 12th Floor, 20
Toronto Street, Toronto, Ontario, M5C 2B8.
DIRECTORS' APPROVAL
The contents and the sending of this circular to the shareholders of the
Corporation have been approved by the Board.
DATED at Toronto, Ontario, the 27th day of July, 2006
BY ORDER OF THE BOARD
("signed")
Michael E. Power
Vice President & Secretary
SCHEDULE "A" STATEMENT OF CORPORATE GOVERNANCE PRACTICES
Mandate of the Board.
The directors are elected by the shareholders and are responsible for the
stewardship of the business and affairs of the Corporation. The board of
directors ("the board") seeks to discharge this responsibility by reviewing,
discussing and approving the Corporation's strategic planning and organizational
structure and supervising management to oversee that the strategic planning and
organizational structure enhance and preserve the business of the Corporation
and the underlying value of the Corporation.
In furtherance of these responsibilities and duties, the principal concerns
addressed by the board are:
Adoption of a strategic planning process:
The board adopts a strategic planning process for the Corporation which
establishes the Corporation's long-term goals and strategies and monitors the
success of the Corporation's management in achieving those goals and in
implementing the strategy.
Identification of the principal risks of the Corporation's business and ensuring
the implementation of appropriate systems to manage these risks:
The board recognizes the inherent risks of operating exploration projects,
including political and currency risks and ensures that there are systems in
place to effectively monitor and manage such risks with a view to the long-term
viability of the Corporation with the objective of achieving a proper balance
between the risks incurred and the potential return to the Corporation's
shareholders.
Succession planning, including appointing, training and monitoring senior
management:
The board engages in succession planning, including appointing, training and
monitoring senior management (which includes ensuring that objectives are in
place against which management's performance can be measured), having in place
programs to train and develop management, providing for the orderly succession
of management and assessing the performance and contribution of the executive
officers of the Corporation.
Communications policy for the Corporation:
The Corporation endeavours to provide all shareholders and the public with
timely and clear information in respect of its mining business, operations,
joint ventures, exploration projects and financial matters in full compliance
with applicable legal and regulatory requirements. The Corporation has
designated the Chief Executive Officer and Corporate Secretary, who may be
reached at the Corporation's offices in Dublin and Toronto, respectively, to be
responsible for receiving and replying to all communications from shareholders
and interested parties of the Corporation and has engaged the services of an
investor relations firm to assist with its program of shareholder
communications. The Corporation has appointed Computershare Trust Company of
Canada with offices in Toronto to be its transfer agent and to effect
dissemination of printed reports to its shareholders.
Integrity of the Corporation's internal control and management information
system:
The Corporation ensures that there are effective controls and information
systems in place for the board to discharge its responsibilities including an
audit system which informs the board about the integrity of its financial data
and the compliance of the financial information with appropriate accounting
principles.
Composition of the Board
The Board shall appoint a chairperson of the Board who shall ensure that the
Board's agenda enables it to successfully carry out its duties. The board is
currently set at five members, two of whom are unrelated directors. An "
unrelated director" is a director who is independent of management as defined in
the policies of the Exchanges. In determining whether a director is an
unrelated director, the board considers, for example, whether the director has a
relationship which could, or could be perceived to, interfere with the
director's ability to objectively assess the performance of management. On this
basis, the directors Noel P. Kiernan, Brian P. Kiernan and Michael E. Power, by
reason of their offices as Chairman of the Board, President & Chief Executive
Officer and Vice President and Corporate Secretary, respectively, are considered
to be related directors.
The Corporation does not have a nominating committee because of the small size
of the board. Discussions concerning nominees are held between the directors.
Nominees would be expected to have industry experience or specific expertise
required by the Corporation and must have the ability to devote the time
required and a willingness to serve.
The Corporation is a junior exploration company with a small market
capitalization. Given the size and nature of the Corporation, the board
considered that a committee to assess the effectiveness of the board, the other
committees of the board and the various contributions of the directors was not
warranted. The effectiveness of the individual members of the board and of the
committees are discussed by the board as a whole at appropriate meetings of the
board.
For a prospective new director, the Corporation and the Chief Executive Officer
provide orientation material, including corporate governance policies and
information on corporate operations, projects, board committees, the
Corporation's approach to environmental issues, shareholder profile and
financial condition of the Corporation.
The compensation of directors is discussed in this Management Information
Circular. The Compensation Committee reviews and makes recommendations to the
board from time to time as to the levels and form of compensation for the
directors to ensure that the compensation adequately reflects the risks and
responsibilities in being an effective director, taking into account industry
practice for companies of similar asset size and operations.
Responsibilities and Duties of the Board
The Board discharges its responsibility for overseeing the management of the
Corporation's business by delegating to the Corporation's senior officers the
responsibility for day-to-day management of the Company. The Board discharges
its responsibilities directly and through its committees - the Audit Committee,
the Corporate Governance Committee, and the Compensation Committee. In addition
to these regular committees, the Board may appoint ad hoc committees
periodically to address issues of a more short-term nature. The Board may
delegate to its committees matters for which the Board is responsible, to the
extent such delegation is permitted by law. Notwithstanding the delegation of
any of its responsibilities to a committee, the Board retains its oversight
function and ultimate responsibility for all delegated matters. The Board's
primary roles are overseeing corporate performance and providing quality, depth
and continuity of management to meet the Corporation's strategic objectives.
Other principal duties include, but are not limited to, the following:
1. Selecting, appointing, evaluating and (if necessary) terminating the Chief
Executive Officer.
2. Adopting a strategic planning process, approving strategic plans, and
monitoring performance against plans.
3. Reviewing and approving annual operational budgets, budget limits and
corporate objectives, and monitoring performance on each of the above.
4. Reviewing policies and procedures to identify business risks, and ensure
that systems and actions are in place to monitor them.
5. Reviewing policies and processes to ensure that the Corporation's internal
control and management information systems are operating properly.
6. Approving the annual financial statements, management discussion and
analysis of financial condition, and annual information form and making a
recommendation to shareholders for the appointment of auditors.
7. Approving the Corporation's code of business conduct and ethics, monitoring
compliance with the code and granting any waivers from the code for the
benefit of directors or officers of the Corporation in accordance with
applicable requirements of the securities regulatory authorities or the
Exchanges
8. Assessing the contribution of the Board members annually, and planning for
succession of the Board.
9. Evaluating the relevant relationships of each independent director and
making an affirmative determination that such relationship does not
preclude a determination that the director is independent.
10. Arranging formal orientation programs for new directors, where appropriate,
and a continuing education program for all directors.
11. Reviewing and approving the compensation of members of the senior
management team, as well as corporate objectives and goals applicable to
each member, in order to ensure that the compensation is competitive within
the industry.
12. Ensuring that an adequate system of internal control is maintained to
safeguard the Corporation's assets and the integrity of its financial and
other reporting systems.
13. Ensuring that there is in place a system of internal disclosure controls
and procedures that sets out the Corporation's disclosure policy and
mandates activities relating to public disclosure, ensures all material
information is properly gathered, reviewed and disseminated, and monitors
and evaluates compliance with, and the effectiveness of, such controls and
procedures.
14. Adopting a process for shareholders and other interested parties to
communicate directly with the Board or the independent directors of the
Board, as appropriate.
15. Reviewing and considering for approval all amendments or departures
proposed by management from established strategy, capital and operating
budgets, or matters of policy, which diverge from the ordinary course of
business.
16. Ensuring that a process is established that adequately provides for
management succession planning, including the appointing, training, and
monitoring of senior management.
17. In addition to the above, adherence to all other Board responsibilities as
set forth in the Corporation's By-laws and other statutory and regulatory
requirements.
Committees of the Board
There are three committees of the board composed of outside directors, a
majority of whom are unrelated, described as follows:
The Audit Committee, with duties outlined below, is comprised of two unrelated
directors. The committee is responsible for all matters related to the
preparation, reporting and auditing of the financial performance of the
Corporation both internally and to its shareholders. Included as its principal
concerns and responsibilities the Audit Committee is required to:
1. To satisfy itself that the Corporation's annual financial statements are
fairly presented in accordance with generally accepted accounting principles
consistent with the Corporation's international operations; to review the annual
financial statements with the auditors for the Corporation; and to make
recommendations to the board on the presentation and approval of the annual
financial report to the shareholders and the report of the auditors contained
therein.
2. To ensure that any information contained in the Corporation's financial
publications such as a prospectus, the annual information form and the
management's discussion of financial condition and results of operations which
accompanies the financial statements, is correct and complete.
3. To review the unaudited quarterly financial statements with management and
if appropriate, the external auditors, and to approve on behalf of the board the
information in the unaudited quarterly financial statements prior to
publication.
4. To ensure that the external audit function has been effectively carried out
and that any matter which the external auditors wish to bring to the board's
attention has been addressed. The Committee will also recommend to the board
the appointment of the external auditors and their remuneration.
5. To review significant income tax planning initiatives to be implemented by
management.
The Compensation Committee is comprised of two unrelated directors. The
committee is responsible for all matters related to establishing the
compensation of and contracts with senior management of the Corporation,
including the consideration of specific contract terms and terms and conditions
consistent with industry practice. It has overall responsibility for policies
on performance reviews, the stock option plan, allocation decisions on stock
options and matters related to compensation contracts and benefits.
The Corporate Governance Committee is comprised of two unrelated directors. The
Committee is responsible for all corporate governance issues involved in a
publicly traded company including those arising from its exploration and mining
activities and in complying with all of the regulatory, safety and environmental
requirements. The board views corporate governance as an on-going process and
reviews and implements related policies accordingly.
Meetings
The powers of the Board may be exercised at a meeting for which notice has been
given and at which a quorum is present or, in appropriate circumstances, by
resolution in writing signed by all the directors. The Board shall meet as
frequently as required to attend to its responsibilities and the independent
directors of the Board shall meet regularly, without members of management (or
other directors) in attendance. Board meetings shall normally proceed as
follows:
Review and approval of the minutes of the preceding meeting; business arising
from the previous minutes; reports of committees; president's report, financial
and operational reports; other business; and termination.
A secretary should be named for each Board and committee meeting and minutes
should be circulated within one week after such meeting. Minutes of the
committees meetings will be given to each Board member and to the Secretary of
the Corporation for inclusion in the Corporations minute books.
During 2005, the Board of Directors held 8 meetings. Mr. Brian Kiernan, Mr Noel
Kiernan, Mr. Sylvester P. Boland, Mr. Victor Jones and Mr. Michael Power
attended all the meetings, Mr. Richard Linnell attended the 6 meetings held
subsequent to his appointment and Mr. Albert Gourley attended 6 meetings.
Meetings are not called at regular intervals as the Corporation is in the
pre-development stage on its projects, and therefore the meetings tend to be
called to consider specific items of business. Although the independent
directors do not meet alone on a regular basis, they are encouraged to remain in
touch with each other.
A director of the Corporation is presently also a director of the following
reporting issuers:
Michael Power Zaruma Resources Inc.
Conroy Diamonds and Gold P.l.c
The Board annually appoints members to the Audit Committee, the Corporate
Governance Committee and the Compensation Committee. Each of the committees is
composed entirely of independent directors, who are "financially literate"
within the meaning of Multi-lateral Instrument 52-110, "Audit Committees". As
noted in the Board's mandate, the Board has adopted a Code of Business Conduct
and Ethics. Compliance is monitored by the Chairman of the Audit Committee.
SCHEDULE "B"
Summary of Certain Differences between the Business Corporations Act (Ontario)
and the Business Corporations Act (British Columbia)(1)
Ontario Act BC Act
Directors Majority of directors must be Canadian No residency requirement for directors.
residents.
Directors may be removed by ordinary Directors may be removed by special resolution
resolution. unless otherwise provided in articles. The
Corporation's articles will provide that
directors may be removed by ordinary resolution.
Provisions for permitted indemnification of Includes detailed provisions for permitted and
directors and officers are substantially the prohibited indemnification of directors or
same as but less detailed than in the BC Act. officers. Unlike the Ontario Act, gives
discretion to the court to order payment or make
any other order it considers appropriate.
Directors are not liable if they rely in good Directors are not liable if they rely in good
faith on financial statements, auditors' faith on financial statements, auditors'
reports or professional reports. reports, professional reports, a statement of
fact from an officer, or on other documents the
court considers provide reasonable grounds for
the directors' actions.
Place of meetings Subject to the articles, directors may Meetings may be held outside British Columbia if
determine place of meetings. provided in the articles or approved by
shareholders. The Corporation's articles will
provide for meetings outside British Columbia.
Ability to set necessary Act does not provide flexibility on Articles can set levels for various shareholder
levels of shareholder shareholder approvals, which are either approvals (other than those prescribed by the
consent majority resolution or (where specified in statute). The default threshold is a special
the act) special resolution. A "special resolution. The percentage of votes required for
resolution" must be passed by at least 2/3 of a special resolution can be specified in the
votes cast. articles, no less than 2/3 and no more than 3/4
of votes cast.
"Corporate incest" A corporation cannot hold shares in itself, A company may purchase and hold its own shares,
and a subsidiary cannot hold shares in its and a subsidiary may hold shares of a parent
parent, except in extremely limited company, unless prohibited by the articles or
circumstances. unless the subsidiary is or would become
insolvent. A subsidiary may not vote shares held
in its parent company or form part of quorum.
Meaning of "insolvent" A corporation may not pay dividends or For purposes of the insolvency test that must be
purchase or redeem its shares if there are passed for the payment of dividends and
reasonable grounds for believing (i) it is or purchases and redemptions of shares, "insolvent"
would be unable to pay its liabilities as is defined to mean a company is unable to pay
they become due; or (ii) it would not meet a its debts as they become due in the ordinary
net asset solvency test. The net asset course of its business. Unlike the Ontario Act,
solvency tests for different purposes vary the BC Act does not impose a net asset solvency
somewhat. test for these purposes. For purposes of
proceedings to dissolve or liquidate, the
definition of "insolvent" from federal
bankruptcy legislation applies.
Reduction of capital Capital may be reduced by special resolution Capital may be reduced by special resolution or
but not if reasonable grounds for believing court order. A court order is required if
that, after the reduction, (i) the reduced capital would be less than the
corporation would be unable to pay its realizable value of the company's assets less
liabilities as they become due; or (ii) the its liabilities.
realizable value of the corporation's assets
would be less than its liabilities.
Shareholders' proposals A shareholder entitled to vote may submit The BC Act includes a more detailed regime for
notice of a proposal. shareholders' proposals than the Ontario Act.
For example, a person submitting a proposal must
have been the registered or beneficial owner of
one or more voting shares for at least 2 years
before signing the proposal. In addition, the
proposal must be signed by shareholders who,
together with the submitter, are registered or
beneficial owners of (i) at least 1% of the
company's voting shares, or (ii) shares with a
fair market value exceeding an amount prescribed
by regulation.
Amalgamations No provision for amalgamation pursuant to Amalgamation may be effected with court
court approval. Interjurisdictional approval. Company may amalgamate with a company
amalgamation is not available - to amalgamate from a foreign jurisdiction and carry on as
either the Ontario corporation must first either a BC company or, if allowed by the
continue out of Ontario into the foreign foreign jurisdiction, a company organized under
jurisdiction or the foreign corporation must the foreign jurisdiction.
first continue into Ontario.
Sale of all or The sale by a corporation of all or The sale by a corporation of all or
substantially all the substantially all its assets, outside of the substantially all its undertaking, outside of
assets or undertaking of ordinary course of business, is permitted the ordinary course of business, is permitted
business only if authorized by special resolution. Any only if authorized by special resolution. Any
such sale gives rise to dissent rights. such sale gives rise to dissent rights. Unlike
the Ontario Act, the BC Act exempts certain
transactions with affiliates.
Dissent rights Provides a right of dissent and appraisal in Provides a substantively similar right of
respect of certain fundamental corporate dissent and appraisal, though there are
actions. No provision for the court to vary differences in the procedural and process
the statutory framework requirements. The court may vary the statutory
framework. Shareholders may waive dissent rights
in respect of a particular change.
Compulsory acquisition Provides a right of compulsory acquisition Provides a substantively similar right although
for an offerer that acquires 90% of the there are differences in the procedures and
target securities pursuant to a take-over process. Unlike the Ontario Act, provides that
bid, other than securities held at the date where an offerer does not use the compulsory
of the bid by or on behalf of the offerer. acquisition right when entitled to do so, a
Unlike the BC Act, provides that where a securityholder who did not accept the original
person (together with its affiliates and offer may require the offerer to acquire the
associates) acquires 90% or more of a class securityholder' s securities involved in the
of securities, other securityholders can original offer.
require the corporation itself to acquire
their securities.
Oppression remedy The scope of potential claimants includes The scope of potential claimants includes
securityholders or former securityholders of shareholders, beneficial owners of shares and
the corporation or any of its affiliates, any other person considered appropriate by the
beneficial owners or former beneficial owners court. Claims may be based on conduct of the
of securities of the corporation or any of corporation that is oppressive or unfairly
its affiliates, directors or officers or prejudicial. Unlike the Ontario Act, the BC Act
former directors or officers of the does not make reference to conduct that "
corporation or any of its affiliates, or any unfairly disregards" interests.
other person considered proper by the court.
Claims may be based on conduct of the
corporation or any of its affiliates that is
oppressive, unfairly prejudicial, or that
unfairly disregards the interests of a
securityholder, creditor, director or
officer.
Derivative actions A securityholder or former securityholder, A shareholder, beneficial owner, director and
beneficial owner or former beneficial owner any other person considered appropriate by the
of a security of the corporation or any of court may, with leave of the court, bring action
its affiliates, a director or officer or in the name of the company or defend an action
former director or officer of the corporation against the company. Shareholder approval of
or any of its affiliates, or any other person action is not determinative but will be taken
considered proper by the court may, with into account.
leave of the court, bring an action in the
name of the corporation or any of its
subsidiaries or intervene in any such action
to prosecute, defend or discontinue it.
Investigations/ Shareholders can apply to the court for the A company may appoint an inspector by special
appointment of inspectors appointment of an inspector. Unlike the BC resolution. Shareholders holding at least 1/5 of
Act, the Ontario Act does not require an all shares may apply to the court for the
applicant to hold a specified number of appointment of an inspector. The court must
shares. consider whether there are reasonable grounds
for believing there has been oppressive,
fraudulent or dishonest conduct.
SCHEDULE "C" SECTION 185 OF THE BUSINESS CORPORATIONS ACT (ONTARIO)
185.(1) Rights of dissenting shareholders. Subject to subsection (3) and
to sections 186 and 248, if a corporation resolves to,
(a) amend its articles under section 168 to add, remove or change restrictions
on the issue, transfer or ownership of shares of a class or series of the
shares of the corporation;
(b) amend its articles under section 168 to add, remove or change any
restriction upon the business or businesses that the corporation may carry
on or upon the powers that the corporation may exercise;
(c) amalgamate with another corporation under sections 175 and 176;
(d) be continued under the laws of another jurisdiction under section 181; or
(e) sell, lease or exchange all or substantially all its property under
subsection 184 (3), a holder of shares of any class or series entitled to vote
on the resolution may dissent.
(2) Idem. If a corporation resolves to amend its articles in a manner
referred to in subsection 170 (1), a holder of shares of any class or series
entitled to vote on the amendment under section 168 or 170 may dissent, except
in respect of an amendment referred to in,
(a) clause 170 (1) (a), (b) or (e) where the articles provide that the holders
of shares of such class or series are not entitled to dissent; or
(b) subsection 170 (5) or (6).
(3) Exception. A shareholder of a corporation incorporated before the
29th day of July, 1983 is not entitled to dissent under this section in respect
of an amendment of the articles of the corporation to the extent that the
amendment,
(a) amends the express terms of any provision of the articles of the
corporation to conform to the terms of the provision as deemed to be amended by
section 277; or
(b) deletes from the articles of the corporation all of the objects of the
corporation set out in its articles, provided that the deletion is made by the
29th day of July, 1986.
(4) Shareholder's right to be paid fair value. In addition to any
other right the shareholder may have, but subject to subsection (30), a
shareholder who complies with this section is entitled, when the action approved
by the resolution from which the shareholder dissents becomes effective, to be
paid by the corporation the fair value of the shares held by the shareholder in
respect of which the shareholder dissents, determined as of the close of
business on the day before the resolution was adopted.
(5) No partial dissent. A dissenting shareholder may only claim under
this section with respect to all the shares of a class held by the dissenting
shareholder on behalf of any one beneficial owner and registered in the name of
the dissenting shareholder.
(6) Objection. A dissenting shareholder shall send to the
corporation, at or before any meeting of shareholders at which a resolution
referred to in subsection (1) or (2) is to be voted on, a written objection to
the resolution, unless the corporation did not give notice to the shareholder of
the purpose of the meeting or of the shareholder's right to dissent.
(7) Idem. The execution or exercise of a proxy does not constitute a
written objection for purposes of subsection (6).
(8) Notice of adoption of resolution. The corporation shall, within
ten days after the shareholders adopt the resolution, send to each shareholder
who has filed the objection referred to in subsection (6) notice that the
resolution has been adopted, but such notice is not required to be sent to any
shareholder who voted for the resolution or who has withdrawn the objection.
(9) Idem. A notice sent under subsection (8) shall set out the rights
of the dissenting shareholder and the procedures to be followed to exercise
those rights.
(10) Demand for payment of fair value. A dissenting shareholder
entitled to receive notice under subsection (8) shall, within twenty days after
receiving such notice, or, if the shareholder does not receive such notice,
within twenty days after learning that the resolution has been adopted, send to
the corporation a written notice containing,
(a) the shareholder's name and address;
(b) the number and class of shares in respect of which the shareholder
dissents; and
(c) a demand for payment of the fair value of such shares.
(11) Certificates to be sent in. Not later than the thirtieth day after
the sending of a notice under subsection (10), a dissenting shareholder shall
send the certificates representing the shares in respect of which the
shareholder dissents to the corporation or its transfer agent.
(12) Idem. A dissenting shareholder who fails to comply with
subsections (6), (10) and (11) has no right to make a claim under this section.
(13) Endorsement on certificate. A corporation or its transfer agent
shall endorse on any share certificate received under subsection (11) a notice
that the holder is a dissenting shareholder under this section and shall return
forthwith the share certificates to the dissenting shareholder.
(14) Rights of dissenting shareholder. On sending a notice under
subsection (10), a dissenting shareholder ceases to have any rights as a
shareholder other than the right to be paid the fair value of the shares as
determined under this section except where,
(a) the dissenting shareholder withdraws notice before the corporation makes
an offer under subsection (15);
(b) the corporation fails to make an offer in accordance with subsection (15)
and the dissenting shareholder withdraws notice; or
(c) the directors revoke a resolution to amend the articles under subsection
168 (3), terminate an amalgamation agreement under subsection 176 (5) or an
application for continuance under subsection 181 (5), or abandon a sale, lease
or exchange under subsection 184 (8), in which case the dissenting shareholder's
rights are reinstated as of the date the dissenting shareholder sent the notice
referred to in subsection (10), and the dissenting shareholder is entitled, upon
presentation and surrender to the corporation or its transfer agent of any
certificate representing the shares that has been endorsed in accordance with
subsection (13), to be issued a new certificate representing the same number of
shares as the certificate so presented, without payment of any fee.
(15) Offer to pay. A corporation shall, not later than seven days after
the later of the day on which the action approved by the resolution is effective
or the day the corporation received the notice referred to in subsection (10),
send to each dissenting shareholder who has sent such notice,
(a) a written offer to pay for the dissenting shareholder's shares in an
amount considered by the directors of the corporation to be the fair value
thereof, accompanied by a statement showing how the fair value was determined;
or
(b) if subsection (30) applies, a notification that it is unable lawfully to
pay dissenting shareholders for their shares.
(16) Idem. Every offer made under subsection (15) for shares of the
same class or series shall be on the same terms.
(17) Idem. Subject to subsection (30), a corporation shall pay for the
shares of a dissenting shareholder within ten days after an offer made under
subsection (15) has been accepted, but any such offer lapses if the corporation
does not receive an acceptance thereof within thirty days after the offer has
been made.
(18) Application to court to fix fair value. Where a corporation fails
to make an offer under subsection (15) or if a dissenting shareholder fails to
accept an offer, the corporation may, within fifty days after the action
approved by the resolution is effective or within such further period as the
court may allow, apply to the court to fix a fair value for the shares of any
dissenting shareholder.
(19) Idem. If a corporation fails to apply to the court under
subsection (18), a dissenting shareholder may apply to the court for the same
purpose within a further period of twenty days or within such further period as
the court may allow.
(20) Idem. A dissenting shareholder is not required to give security
for costs in an application made under subsection (18) or (19).
(21) Costs. If a corporation fails to comply with subsection (15), then
the costs of a shareholder application under subsection (19) are to be borne by
the corporation unless the court otherwise orders.
(22) Notice to shareholders. Before making application to the court
under subsection (18) or not later than seven days after receiving notice of an
application to the court under subsection (19), as the case may be, a
corporation shall give notice to each dissenting shareholder who, at the date
upon which the notice is given,
(a) has sent to the corporation the notice referred to in subsection (10); and
(b) has not accepted an offer made by the corporation under subsection (15),
if such an offer was made, of the date, place and consequences of the
application and of the dissenting shareholder's right to appear and be heard in
person or by counsel, and a similar notice shall be given to each dissenting
shareholder who, after the date of such first mentioned notice and before
termination of the proceedings commenced by the application, satisfies the
conditions set out in clauses (a) and (b) within three days after the dissenting
shareholder satisfies such conditions.
(23) Parties joined. All dissenting shareholders who satisfy the
conditions set out in clauses (22) (a) and (b) shall be deemed to be joined as
parties to an application under subsection (18) or (19) on the later of the date
upon which the application is brought and the date upon which they satisfy the
conditions, and shall be bound by the decision rendered by the court in the
proceedings commenced by the application.
(24) Idem. Upon an application to the court under subsection (18) or
(19), the court may determine whether any other person is a dissenting
shareholder who should be joined as a party, and the court shall fix a fair
value for the shares of all dissenting shareholders.
(25) Appraisers. The court may in its discretion appoint one or more
appraisers to assist the court to fix a fair value for the shares of the
dissenting shareholders.
(26) Final order. The final order of the court in the proceedings
commenced by an application under subsection (18) or (19) shall be rendered
against the corporation and in favour of each dissenting shareholder who,
whether before or after the date of the order, complies with the conditions set
out in clauses (22) (a) and (b).
(27) Interest. The court may in its discretion allow a reasonable rate
of interest on the amount payable to each dissenting shareholder from the date
the action approved by the resolution is effective until the date of payment.
(28) Where corporation unable to pay. Where subsection (30) applies,
the corporation shall, within ten days after the pronouncement of an order under
subsection (26), notify each dissenting shareholder that it is unable lawfully
to pay dissenting shareholders for their shares.
(29) Idem. Where subsection (30) applies, a dissenting shareholder, by
written notice sent to the corporation within thirty days after receiving a
notice under subsection (28), may,
(a) withdraw a notice of dissent, in which case the corporation is deemed to
consent to the withdrawal and the shareholder's full rights are reinstated; or
(b) retain a status as a claimant against the corporation, to be paid as soon
as the corporation is lawfully able to do so or, in a liquidation, to be ranked
subordinate to the rights of creditors of the corporation but in priority to its
shareholders.
(30) Idem. A corporation shall not make a payment to a dissenting
shareholder under this section if there are reasonable grounds for believing
that,
(a) the corporation is or, after the payment, would be unable to pay its
liabilities as they become due; or
(b) the realizable value of the corporation's assets would thereby be less
than the aggregate of its liabilities.
(31) Court order. Upon application by a corporation that proposes to
take any of the actions referred to in subsection (1) or (2), the court may, if
satisfied that the proposed action is not in all the circumstances one that
should give rise to the rights arising under subsection (4), by order declare
that those rights will not arise upon the taking of the proposed action, and the
order may be subject to compliance upon such terms and conditions as the court
thinks fit and, if the corporation is an offering corporation, notice of any
such application and a copy of any order made by the court upon such application
shall be served upon the Commission.
(32) Commission may appear. The Commission may appoint counsel to
assist the court upon the hearing of an application under subsection (31), if
the corporation is an offering corporation.
--------------------------
(1) This summary deals only with differences between the two
statutes that may be significant to shareholders of the Corporation. In
addition, it is not intended to be exhaustive. For a full understanding of the
differences and similarities of the Ontario Act and the BC Act, reference should
be made to the text of the two statutes, both available at
http://www.canlii.org/.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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Moydow Mines (LSE:MOY)
Historical Stock Chart
From Jun 2024 to Jul 2024
Moydow Mines (LSE:MOY)
Historical Stock Chart
From Jul 2023 to Jul 2024
