Exhibit 1.1 c
[CANADA LETTERHEAD]
Certificate of Amendment Certificat de modification
Canada Business Loi sur les societes
Corporations Act Commerciales canadiennes
HOLLINGER INC. 197578-1
NAME OF CORPORATION - DENOMINATION DE LA SOCIETE NUMBER - NUMERO
I hereby certify that the Je certifie par les presentes que
Articles of the above-mentioned les statuts dela societe
Corporation were amended mentionnee ci-haut ont ete modifies
(a) under Section 13 of the [ ] (a) en vertu de I' article 13 de la
Canada Business Corporations Loi sur les societes commerciales
Act in accordance with the canadiennes conformement a l'avis
attached notice; ci-joint;
(b) under Section 27 of the [X] (b) en vertu de l'article 27 de la
Canada Business Corporations Loi sur les societes commerciales
Act as set out in the attached canadiennes tel qu'indique dans les
Articles of Amendment clasuses modificatrices ci-joint
designating a series of shares; designant une serie d'actions;
(c)under Section 171 of the [ ] (c) en vertu de 1'article 171 de la
Canada Business Corporations Loi sur les societes commerciales
Act as set out in the attached canadiennes tel qu'indique dans les
Articles of Amendment; clauses modificatrices ci-jointes;
(d) under Section 185 of the [ ] (d) en vertu de 1'article 185 de la
Canada Business Corporations Loi sur les societes commerciales
Act as set out in the attached canadiennes tel qu'indique dans les
Articles of Reorganization; clauses de reorganisation ci-jointes;
(e) under Section 185.1 of the [ ] (e) en vertu de 1'article 185.1 de la
Canada Business Corporations Loi sur les societes commerciales
Act as set out in the attached canadiennes tel qu'indique dans les
Articles of Arrangement. clauses d'arrangement ci-jointes.
LE DIRECTEUR
JUNE 14, 1989/LE 14 JUIN 1989
DIRECTOR DATE OF AMENDMENT - DATE DE LA MODIFICATION
[CANADA LETTERHEAD]
FORM 4
ARTICLES OF AMENDMENT
(SECTION 27 OR 177)
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1 - NAME OF CORPORATION 2 - CORPORATION NO.
HOLLINGER INC. 197578-1
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3 - THE ARTICLES OF THE ABOVE-NAMED CORPORATION ARE AMENDED AS FOLLOWS:
(i) by adding to paragraph 3 thereof the following:
(k) the Directors hereby fix the number of shares for the eighth
series of Preference Shares at 725,000;
(l) the eighth series of Preference Shares is hereby designated as
Non-Voting Non-Cumulative Redeemable Retractable Convertible
Preference Shares, Series H, and shall have attached thereto
the rights, privileges, restrictions and conditions (in
addition to the rights, privileges, restrictions and
conditions attaching to the Preference Shares as a class) set
out in Schedule "A" attached hereto, which Schedule "A" is
incorporated in and forms part of this Form;
(ii) by increasing the maximum number of directors from 21 to 25.
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DATE SIGNATURE TITLE
June 14, 1989 Vice-President & Secretary
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FOR DEPARTMENTAL USE ONLY
Filed 14/6/89
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Schedule "A"
Number of, Designation of and Rights, Privileges,
Restrictions and Conditions attaching
to the Non-Voting Non-Cumulative
Redeemable Retractable Convertible
Preference Shares, Series H
The eighth series of Preference Shares of the Corporation shall consist
of 725,000 Preference Shares which shall be designated as Non-Voting
Non-Cumulative Redeemable Retractable Convertible Preference Shares, Series H
(hereinafter referred to as the "Series H Preference Shares") and which, in
addition to the rights, privileges, restrictions and conditions attached to the
Preference Shares as a class, shall have attached thereto the following rights,
privileges, restrictions and conditions:
1. Definitions
Wherever used herein, unless there is something in the subject matter
or context inconsistent therewith, the following words and terms shall have the
respective meanings ascribed to them as follows:
"Board of Directors" means the board of directors of the corporation.
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"Corporation" means Hollinger Inc. and any successor corporation and
any reference herein to action by the Corporation means action by or under the
authority of its Board of Directors or a duly empowered committee appointed by
the Board of Directors.
"Conversion Period" means with respect to each Series H Preference
Share the period commencing on the Date of Grant relating to such Series H
Preference Share and terminating at the earlier of the date six (6) years
thereafter or the day preceding the date of redemption of such Series H
Preference Share.
"Conversion Price" means with respect to each Series H Preference Share
the price per Share at which the Series H Preference Share may be converted into
Shares. For this purpose the price per Share is determined on the basis of the
weighted average price per share for all board lots of Shares traded on The
Toronto Stock Exchange on each of the ten (10) consecutive trading days ending
on the third trading day preceding the Date of Grant less a discount of 10% from
such average price; for the purpose of this Plan, the expression "trading day"
means a day on which shares are traded on The Toronto Stock Exchange and on
which at least one board lot of Shares is traded.
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"Conversion Rate" means the number or fraction thereof derived by
dividing the Purchase Price by the Conversion Price subject to such further
adjustments as may be required pursuant to clause 6.8 hereof.
"Date of Grant" means with respect to each Series H Preference Share
the date of the resolution of the Board of Directors granting the Eligible
Employee the right to purchase such Series H Preference Share.
"Expiration Date" means the last day of the Conversion Period.
"Eligible Employee" means a person who is an officer and/or employee of
a Participating Company and is designated by the Board of Directors or a duly
authorized committee of the Board of Directors as being eligible to obtain a
Loan and participate in this Plan.
"Loan" means the loan or loans made at any time and from time to time
by the Corporation or a Participating Company to an Eligible Employee to be used
by the Eligible Employee for the sole purpose of enabling or assisting the
Eligible Employee to purchase fully paid Series H Preference Shares from the
Corporation.
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"Normal Retirement" means the last day of the month in which the 65th
birthday of the Eligible Employee occurs or such later date upon which the
Eligible Employee actually retires.
"Participating Company" means with respect to each Eligible Employee,
the Corporation and any subsidiary or affiliated company of the Corporation. A
"subsidiary company" is a company in which the Corporation directly or
indirectly may exercise voting rights with respect to more than fifty percent
(50%) of the issued and outstanding voting shares. An "affiliated company" is a
company other than a subsidiary company in which the Corporation directly or
indirectly may exercise voting rights with respect to a substantial percentage
of the issued and outstanding voting shares and is designated by the Board of
Directors as an affiliated company.
"Plan" means the Executive Share Purchase Plan of the Corporation
adopted by the Board of Directors and the holders of Shares of the Corporation
on June 2, 1987, as amended.
"Purchase Price" means with respect to each Series H Preference Share
the issue price of such Series H Preference Share which issue price shall be
equal in amount to the Conversion Price of such Series H Preference Shares.
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"Redemption Price" means with respect to each Series H Preference Share
the Purchase Price of such Series H Preference Share.
"Series H Preference Share" means the Non-Voting Non-Cumulative
Redeemable Retractable Convertible Preference Shares, Series H of the
Corporation designated, created and authorized by the Board of Directors for the
purpose of the Plan.
"Shares" means the common shares of the Corporation and any shares or
securities of the Corporation into which such common shares are changed,
converted, subdivided, consolidated or reclassified.
Words importing the singular number only shall include the plural and
vice versa; words importing the use of any gender shall include all genders.
2. Consideration for Issue
The consideration for the issue of each Series H Preference Share shall
be $13.08 (the "Paid Up Amount").
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3. Dividends
3.1 Payment of Dividends
The holders of the Series H Preference Shares shall be entitled to
receive, and the Corporation shall pay thereon, as and when declared by the
Board of Directors of the Corporation, in its discretion out of monies of the
Corporation properly applicable to the payment of dividends, non-cumulative
preferential cash dividends in lawful money of Canada.
3.2 Method of Payment
Dividends (less any tax required to be withheld by the Corporation) on
the Series H Preference Shares shall be paid by cheque payable in lawful money
of Canada at par at any branch in Canada of the Corporation's bankers for the
time being or by any other reasonable means the Corporation deems desirable. The
mailing of such cheque from the Corporation's registered office, or from the
principal office in Toronto of the registrar for the Series H Preference Shares,
or the payment by such other reasonable means as the Corporation deems
desirable, on or before the date on which such dividend is to be paid to a
holder of Series H Preference Shares shall be deemed to be payment of
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the dividends represented thereby and payable on such date unless the cheque is
not paid upon presentation or payment by such other means is not received.
Dividends which are represented by a cheque which has not been presented to the
Corporation's bankers for payment or that otherwise remain unclaimed for a
period of 6 years from the date on which they were declared to be payable shall
be forfeited to the Corporation.
3.3 Entitlement to Dividends
The holders of Series H Preference Shares shall not be entitled to any
dividends other than or in excess of the non-cumulative preferential cash
dividends herein provided for.
4. Redemption
4.1 Optional Redemption
Subject to applicable law the Corporation may, without giving notice,
redeem the whole or any part of the then outstanding Series H Preference Shares
held by an Eligible Employee, on the next day following the earlier of the
Expiration Date and in the case of the cessation of employment of such Eligible
Employee on the expiration of the applicable time within which the Eligible
Employee or his personal
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representative had the right to convert the Series H Preference Shares held by
him, on payment for each share to be redeemed of the Redemption Price together
with all accrued and unpaid dividends thereon up to but excluding the date fixed
for redemption, (the whole constituting and being herein referred to as the
"Total Redemption Price").
4.2 Partial Redemption
If a part only of the Series H Preference Shares represented by any
certificate shall be redeemed, a new certificate representing the balance of
such shares shall be issued to the holder thereof at the expense of the
Corporation upon presentation and surrender of the first mentioned certificate.
4.3 Method of Redemption
On and after the date specified for redemption, the Corporation shall
pay or cause to be paid to or to the order of the registered holders of the
Series H Preference Shares to be redeemed the Total Redemption Price of such
shares upon presentation and surrender, at the registered office of the
Corporation, of the certificate or certificates representing the Series H
Preference Shares to be redeemed. Payment in respect of Series H Preference
Shares being redeemed shall be made by
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cheque payable to the holders thereof in lawful money of Canada at par at any
branch in Canada of the Corporation's bankers for the time being or by any other
reasonable means the Corporation deems desirable and such payment shall be a
full and complete discharge of the Corporation's obligation to pay the Total
Redemption Price owed to the holders of Series H Preference Shares to be
redeemed unless the cheque is not honoured when presented for payment or payment
by such other reasonable means is not received. From and after the date
specified for redemption, the Series H Preference Shares to be redeemed shall
cease to be entitled to dividends or any other participation in the assets of
the Corporation and the holders thereof shall not be entitled to exercise any of
their other rights as shareholders in respect thereof, other than the right to
receive the Total Redemption Price, unless payment of the Total Redemption Price
shall not be made upon presentation and surrender of the certificates in
accordance with the foregoing provisions, in which case the rights of the
holders shall remain unaffected. The Corporation shall have the right at any
time to deposit an amount equal to the aggregate Total Redemption Price of the
Series H Preference Shares so redeemed, or of such of the Series H Preference
Shares which are represented by certificates which have not at the date of such
deposit been surrendered by the holders thereof in connection with such
redemption, to a special account in any chartered bank or any trust company in
Canada in respect of which the deposit is made, to be paid
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without interest to or to the order of the respective holders of Series H
Preference Shares so redeemed upon presentation and surrender to such bank or
trust company of the certificates representing such shares. Upon such deposit
being made the Series H Preference Shares in respect of which such deposit shall
have been made shall be deemed to be redeemed and the rights of the holders
thereof shall be limited to receiving, without interest, their proportionate
part of the amount so deposited upon presentation and surrender of the
certificate or certificates representing their Series H Preference Shares being
redeemed. Any interest allowed on any such deposit shall belong to the
Corporation.
Redemption monies that are represented by a cheque which has not been
presented to the Corporation's bankers for payment or that otherwise remain
unclaimed (including monies held on deposit to a special account as provided for
above) for a period of 6 years from the date specified for redemption shall be
forfeited to the Corporation.
5. Retraction at the Option of the Holder
5.1 Right to Require Redemption
Subject to applicable law and to the rights, privileges, restrictions
or conditions attaching to any shares
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of the Corporation, a holder of Series H Preference Shares shall be entitled to
require the Corporation to redeem only that number of outstanding Series H
Preference Shares registered in his name (the date of redemption being herein
referred to as the "Retraction Date") in respect of which the pro rata portion
of a Loan from the Corporation to the holder becomes payable by the holder, at a
price per share equal to the Redemption Price plus an amount equal to all
accrued and unpaid dividends thereon to but excluding the Retraction Date (the
whole constituting and being herein referred to as the "Retraction Price").
5.2 Retraction Procedure
In order to elect to have the Corporation redeem Series H Preference
Shares pursuant to the retraction privilege, each holder of Series H Preference
Shares who is entitled and desires to have the Corporation redeem any or all of
the Series H Preference Shares registered in his name must tender to the
transfer agent (the "Transfer Agent") for the Series H Preference Shares the
certificate or certificates representing the Series H Preference Shares which
the holder wishes to have the Corporation redeem with the retraction panel on
such share certificate or such other election form as may be designated by the
Corporation for such purposes which includes at least substantially the same
information as the retraction panel on the date of initial issue of the Series H
Preference Shares, in
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either case duly completed by the registered holder specifying the number of
Series H Preference Shares represented by such certificate that are to be
redeemed by the Corporation on the Retraction Date and specifying the Business
Day on which the holder desires to have the Corporation redeem such Series H
Preference Shares which Business Day (which shall be the Retraction Date) shall
not be less than 10 calendar days after the day on which the notice is given to
the Corporation. Such presentation and surrender of the Series H Preference
Shares for redemption and such specification of the Retraction Date shall be
irrevocable except with respect to those Series H Preference Shares which are
not redeemed by the Corporation on the Retraction Date.
Subject to applicable law and to the rights, privileges, conditions,
restrictions or conditions attaching to any shares of the Corporation, the
Corporation shall, on the Retraction Date, redeem, at a price per Series H
Preference Share equal to the Retraction Price, the Series H Preference Shares
in respect of which the certificates have been surrendered for redemption in
accordance with the provisions of this clause 5. Payment of the Retraction Price
may be made by cheque of the Corporation or any other reasonable means the
Corporation deems desirable and such payment of the Retraction Price shall be a
full and complete discharge of the Corporation's obligation to pay the
Retraction Price owed to the holders of Series H
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Preference Shares so presented and surrendered for redemption. Subject as
hereinafter provided, the Series H Preference Shares so presented and
surrendered for redemption shall be and be deemed to be redeemed on the
Retraction Date. From and after the Retraction Date, a holder of any Series H
Preference Share presented and surrendered for redemption shall not be entitled
to dividends or to exercise any of the rights of a holder of Series H Preference
Shares in respect thereof except the right to receive the Retraction Price,
provided that if payment of the Retraction Price is not duly made by or on
behalf of the Corporation in accordance with the provisions hereof, then the
rights of such holder shall remain unaffected.
If part only of the Series H Preference Shares represented by any
certificate are redeemed as aforesaid, a new certificate for the balance of such
shares shall be issued at the expense of the Corporation.
5.3 Retraction Subject to Applicable Law
If on the Retraction Date, the Corporation determines that it will not
be permitted, under insolvency provisions, other provisions of any applicable
law or the rights, privileges, restrictions or conditions attaching to any
shares of the Corporation, to redeem all of the Series H Preference Shares
tendered for redemption, the Corporation shall redeem, on
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the Retraction Date, that number of Series H Preference Shares which it is then
permitted to redeem in accordance with the aforementioned provisions of law
(rounded to the next lower multiple of 1,000) and the shares so to be redeemed
shall be selected pro-rata (disregarding fractions) in proportion to the total
number of Series H Preference Shares so presented and tendered for redemption by
each holder thereof. In such case if a part only of the Series H Preference
Shares represented by any certificate shall be redeemed, a new certificate for
the Series H Preference Shares not so redeemed shall be issued at the expense of
the Corporation and held on the terms hereinafter set out.
If the Corporation shall fail to redeem, because of any of the
aforementioned provisions, all Series H Preference Shares in respect of which
the holders thereof shall have exercised the retraction privilege (such shares
not so redeemed being hereinafter referred to as the "Deposited Shares" and the
holders who shall have exercised the retraction privilege in respect thereof
being hereinafter referred to as the "Retracting Shareholders"), the Corporation
shall continue to hold the Deposited Shares and shall, as soon as possible (but
in any event within 14 days) after the Retraction Date, send a notice to each
Retracting Shareholder stating:
(i) the number of Deposited Shares of such Retracting Shareholder held by
the Corporation,
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(ii) the intention of the Corporation to redeem on the first day of each
subsequent month of March, June, September and December in each year (a
"Subsequent Retraction Date") thereafter from all Retracting
Shareholders who tendered in respect of the Retraction Date, on a
pro-rata basis, that number of Deposited Shares as it is then permitted
by applicable law to redeem, and
(iii) the right of such Retracting Shareholder to require the Corporation to
return to him all of the Deposited Shares with the result that the
obligation of the Corporation to redeem the Deposited Shares so
returned on any Subsequent Retraction Date shall cease.
The Corporation shall, on each Subsequent Retraction Date thereafter if it is
permitted on such date by insolvency provisions and other provisions of any
applicable law and the rights, privileges, restrictions or conditions attaching
to any shares of the Corporation, redeem, on a pro-rata basis as aforesaid from
all Retracting Shareholders whose Deposited Shares have not been returned as
aforesaid, that number of Deposited Shares as it is then permitted by applicable
law to redeem at the Redemption Price per share plus an amount equal to all
accrued and unpaid dividends thereon to but excluding the Subsequent Retraction
Date. The Series H Preference Shares to
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be redeemed on a Subsequent Retraction Date shall be redeemed in accordance with
this clause 5 save and except that payment therefor shall be accompanied by a
statement to each Retracting Shareholder setting out the number of Deposited
Shares of such Retracting Shareholder redeemed and the number of Deposited
Shares remaining in the name of such Retracting Shareholder. Except as otherwise
provided herein, Retracting Shareholders shall continue to be entitled to
exercise all of the rights of shareholders in respect of the Deposited Shares
and to receive dividends thereon except that, in order to obtain possession of
the share certificate or certificates representing the Deposited Shares, a
Retracting Shareholder must give ten days written notice to the Corporation
(given not less than 20 days prior to any Subsequent Retraction Date) requiring
the Corporation to return to him all of the Deposited Shares held in his name by
the Corporation. Upon receipt of such written notice the Corporation shall
promptly send to such Retracting Shareholder a share certificate or share
certificates for that number of Series H Preference Shares which such Retracting
Shareholder has requested the Corporation to return. Such shares shall then
cease to be Deposited Shares and such Retracting Shareholder shall cease to have
any right to receive any payment with respect thereto pursuant to this clause 5.
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If the directors of the Corporation have acted in good faith in making
any of the determinations referred to above as to the number of Series H
Preference Shares which the corporation was permitted at any time to redeem, the
Corporation shall have no liability in the event that any such determination
proves inaccurate.
6. Conversion at the Option of the Holders
6.1 Right of Conversion
(i) General
Upon and subject to the terns and conditions hereinafter set forth,
each holder of Series H Preference Shares received on original issue from the
Corporation shall have the right, subject to clauses (ii) and (iii) of this
clause 6.1, to convert up to the following maximum number of Series H Preference
Shares into fully paid and non-assessable common shares of the Corporation at
the Conversion Rate in effect on the date of conversion:
(A) on or after the first anniversary of the Date of
Grant up to twenty-five per cent (25%) of his Series
H Preference Shares subscribed for pursuant to such
grant;
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(B) on or after the second anniversary of the Date of
Grant up to fifty per cent (50%) of his Series H
Preference Shares subscribed for pursuant to such
grant (including those previously converted as
provided in Subclause (A));
(C) on or after the third anniversary of the Date of
Grant, up to seventy-five per cent (75%) of his
Series H Preference Shares subscribed for pursuant to
such grant (including those previously converted as
provided in Subclauses (A) and (B)); and
(D) on or after the fourth anniversary of the Date of
Grant up to one hundred per cent (100%) of his Series
H Preference Shares subscribed for pursuant to such
grant.
(ii) On Cessation of Employment
(A) Retirement - If the Eligible Employee ceases to be
employed, either by the Corporation or a
Participating Company, as a result of Normal
Retirement, the conversion rights
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attaching to all of the Series H Preference Shares of
such holder shall be immediately and fully
exercisable. Such conversion rights may be exercised
at any time during the period which commences on the
date of Normal Retirement, and ends on the earlier of
the date which is one (1) month thereafter, or the
Expiration Date, provided that if the Eligible
Employee dies during such exercise period, the
conversion rights may be exercised by his executor or
other personal representative, in whole or in part,
at any time or from time to time, during the period
which commences on the date of death and ends on the
earlier of six (6) months from the date of death of
the Eligible Employee or the Expiration Date.
(B) Termination - If the Eligible Employee ceases to be
employed, either by the Corporation or a
Participating Company as a result of (I) his
voluntarily leaving such employment (other than by
Normal Retirement referred to in Subclause (A) above)
or (II) being dismissed for cause, the Eligible
Employee's conversion rights attaching to the Series
H
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Preference Shares of such holder shall be limited to
the number of Preference Shares in respect of which
they are exercisable immediately prior to the time he
ceased to be employed. Such limited conversion rights
may be exercised at any time during the period which
commences on the date of termination of employment
and ends on the earlier of the date which is one (1)
month thereafter or the Expiration Date.
(C) Death - In the case of termination of employment by
the Corporation or a Participating Company caused by
the death of the Eligible Employee, the conversion
rights attaching to all of the Series H Preference
Shares of such Eligible Employee shall be immediately
and fully exercisable, and such conversion rights may
be exercised by his executor or other personal
representative, in whole or in part, at any time or
from time to time, during the period which commences
on the date of death and ends on the earlier of the
date which is six (6) months thereafter or the
Expiration Date.
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(D) Other Termination - If the Eligible Employee ceases
to be employed either by the Corporation or a
Participating Company for any reason other than the
ones referred to in Subclauses (A), (B) or (C) above,
the conversion rights attaching to all of the Series
H Preference Shares of such Eligible Employee shall
be immediately and fully exercisable, and such
conversion rights may be exercised, in whole or in
part, at any time or from time to time during the
period which commences on the date of termination of
employment and ends on the earlier of the date which
is one (1) month thereafter or the Expiration Date.
(iii) Offer
With respect to the Series H Preference Shares, in the event that an
offer is made:
(1) to all or substantially all of the holders of the
Shares of the corporation, or
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(2) to all or substantially all of the holders of all the
Shares of the Corporation whose last address on the
records of the Company is in Canada,
at a price at least equal to the market price of the Shares
immediately prior to the making of the Offer then the
conversion rights attaching to all of the Series H Preference
Shares held by the purchaser of such. Series H Preference
Shares on original issue from the Corporation shall become
immediately and fully exercisable during the period of such
offer notwithstanding clause (i) and such holder may exercise
such conversion rights, in whole or in part, at any time or
from time to time during the period of such offer.
The initial Conversion Rate shall be one (1) common share for each
Series H Preference Share to be converted, subject to adjustment from time to
time as hereinafter provided. For the purposes of this clause 6, "common shares"
mean common shares in the capital of the Corporation as such shares were
constituted on June 2, 1987, and shares of any other class resulting from the
reclassification or change of such common shares and "Conversion Rate" at any
time means the number of common shares of the Corporation into which at such
time one
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Series H Preference Share shall be convertible in accordance with the
provisions of this clause 6.
6.2 Exercise of Right
The conversion right herein provided for may be exercised by notice in
writing given to the Secretary of the Corporation at its registered office or to
the transfer agent of the Corporation for the Series H Preference Shares at any
office for the transfer of Series H Preference Shares, accompanied by the
certificate or certificates representing the Series H Preference Shares in
respect of which the holder thereof is entitled and desires to exercise such
right of conversion. Such notice shall be signed by such holder or his agent and
shall specify the number of Series H Preference Shares which the holder is
entitled and desires to have converted. If less than all the Series H Preference
Shares represented by any certificate or certificates accompanying any such
notice are to be converted, the holder shall be entitled to receive, at the
expense of the Corporation, a new certificate representing the Series H
Preference Shares comprised in the certificate or certificates surrendered as
aforesaid which are not to be converted.
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6.3 Entitlement to Dividends
The registered holder of any Series H Preference Share on the record
date for any dividend payable on such shares shall be entitled to such dividend
notwithstanding that such shares shall have been converted into common shares
after such record date and before the payment date of such dividend, and the
registered holder of a common share resulting from such conversion shall be
entitled to rank equally per common share with the registered holders of all
other common shares in respect of all dividends payable to holders of common
shares of record on any date on or after the date of such conversion.
Subject to the foregoing, upon conversion of any Series H Preference
Shares there shall be no adjustment by the Corporation or by any holder of
Series H Preference Shares on account of any dividend either on the Series H
Preference Shares so converted or on the common shares resulting from such
conversion.
6.4 Shares Called For Redemption
In the case of any Series H Preference Shares which are called for
redemption, the right of conversion thereof shall terminate on the Expiration
Date provided, however, that if the
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Corporation shall fail to redeem such Series H Preference Shares, the right of
conversion shall thereupon be restored.
6.5 Certificates
On any conversion of Series H Preference Shares, the share certificate
or certificates representing the common shares of the Corporation resulting
therefrom shall be issued at the expense of the Corporation in the name of the
holder of the Series H Preference Shares converted, provided that such holder
shall pay any applicable security transfer taxes.
6.6 Timing
The right of a holder of Series H Preference Shares to convert the same
into common shares shall be deemed to have been exercised, and the holder of
Series H Preference Shares to be converted, or any person or persons in whose
name or names such holder of Series H Preference Shares shall have directed a
certificate or certificates representing common shares to be issued as provided
in clause 6.5, shall be deemed to have become a holder of common shares of the
Corporation for all purposes on the date or dates of receipt by the Secretary of
the Corporation or the transfer agent of the Series H Preference Shares of the
certificate or certificates representing the Series H Preference
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Shares to be converted accompanied by notice in writing as referred to in clause
6.2, notwithstanding any delay in the delivery of the certificate or
certificates representing the common shares into which such Series H Preference
Shares have been converted.
6.7 No Fractional Shares
The Corporation shall not issue fractional shares in satisfaction of
the conversion rights herein provided for but in lieu thereof may, in respect of
any fractional interest resulting from the exercise of conversion rights, either
pay a cash adjustment or issue or cause to be issued non-voting and non-dividend
bearing scrip certificates in a form approved by the Board of Directors which
scrip certificates will, subject to the conditions thereof, entitle the holder
thereof to receive a certificate for a full common share by exchanging scrip
certificates aggregating a full common share. The amount of any cash adjustment
shall equal the Current Market Price (as defined in paragraph (d) of clause 6.8)
of such fractional interest. If scrip certificates are issued, such scrip
certificates may contain provisions to the effect that, after the expiration of
one year from their date of issuance, the Corporation may sell or cause to be
sold all the shares then represented by unsurrendered scrip certificates and the
sole rights of the holders of the scrip certificates after the expiration of
said
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period shall be, against surrender of their scrip certificates, to receive
payment of the proportionate amounts of the net proceeds of such sale, less
taxes and costs of sale, payable by cheque in lawful money of Canada at par at
any branch in Canada of the Corporation's bankers for the time being. Such scrip
certificates shall not confer on the holders thereof any rights as a
shareholder. If a cash adjustment or a proportionate amount of the net proceeds
of a sale is to be paid pursuant to the provisions of this clause 6.7, the
mailing from the Corporation's registered office or the principal office in
Toronto of the registrar for the Series H Preference Shares to a holder of
Series H Preference Shares who has exercised his right to convert shall be
deemed to be payment of the cash adjustment or the proportionate amount of the
net proceeds of a sale, as the case may be, resulting from such fractional
interest unless the cheque is not paid upon due presentation. Cash adjustments
or proportionate amounts that are represented by a cheque which has not been
presented to the Corporation's bankers for payment or that otherwise remain
unclaimed for a period of 6 years from the date on which the same became payable
shall be forwarded to the Corporation.
6.8 Adjustment of Conversion Rate
The Conversion Rate shall be subject to adjustment from time to time as
follows:
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(a) in case the Corporation shall
(i) subdivide its outstanding common shares into a
greater number of shares,
(ii) consolidate its outstanding common shares into a
smaller number of shares, or
(iii) issue common shares (or securities convertible into
common shares) to the holders of its outstanding
common shares by way of a stock dividend (other than
an issue of common shares to shareholders pursuant to
their exercise of options to receive dividends in the
form of common shares in lieu of cash dividends
declared payable in the ordinary course by the
Corporation on its common shares),
the Conversion Rate in effect on the effective date of such
subdivision or consolidation or on the record date for such
issue of common shares (or securities convertible into common
shares) by way of a stock dividend, as the case may be, in the
case of the events referred to in (i) and (iii) above, shall
be increased in proportion to the increase in the number of
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outstanding common shares resulting from such subdivision or
from such stock dividend or from such distribution assuming
the issue by the Corporation of the maximum number of common
shares into which such convertible securities are convertible
or, in the case of the event referred to in (ii) above, shall
be decreased in proportion to the decrease in the number of
outstanding common shares resulting from such consolidation;
such adjustment shall be made successively whenever any event
referred to in this paragraph (a) shall occur; any such issue
of common shares by way of a stock dividend shall be deemed to
have been made on the record date for the stock dividend for
the purpose of calculating the number of outstanding common
shares under paragraphs (b) and (c) of this clause 6.8;
(b) in case the Corporation shall fix a record date for the
issuance of rights, options or warrants to all or
substantially all the holders of its outstanding common shares
entitling them, for a period expiring no more than 45 days
after such record date, to subscribe for or purchase common
shares (or securities convertible into common shares) at a
price per share (or having a conversion price per share) less
than 95% of the Current Market Price (as hereinafter defined
in
- 30 -
paragraph (d) of this clause 6.8) of a common share on such
record date, the Conversion Rate shall be adjusted immediately
after such record date so that it shall equal the rate
determined by multiplying the Conversion Rate in effect on
such record date by a fraction, of which the denominator shall
be the total number of common shares outstanding on such
record date, plus a number of common shares equal to the
number arrived at by dividing the aggregate price of the total
number of additional common shares offered for subscription or
purchase (or the aggregate conversion price of the total
number of convertible securities so offered) by the Current
Market Price per common share on such record date, and of
which the numerator shall be the total number of common shares
outstanding on such record date plus the total number of
additional common shares offered for subscription or purchase
(or into which the total number of convertible securities so
offered are convertible); any common shares owned by or held
for the account of the Corporation shall be deemed not to be
outstanding for the purpose of any such computation; such
adjustment shall be made successively whenever such a record
date is fixed; to the extent that such rights, options or
warrants are not so issued or such rights, options or warrants
are not exercised prior to the expiration thereof, the
Conversion Rate
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shall be readjusted immediately after the expiry date for the
exercise of such rights, options or warrants to the Conversion
Rate which would then be in effect if such record date had not
been fixed, or to the Conversion Rate which would then be in
effect based upon the number of common shares (or securities
convertible into common shares) actually delivered upon the
exercise of such rights, options or warrants, as the case may
be;
(c) in case the Corporation shall fix a record date for the making
of a distribution (including a distribution by way of a stock
dividend) to all or substantially all the holders of its
outstanding shares of
(i) shares of any class other than common shares
(excluding shares convertible into common shares
referred to in paragraph (a) of this clause 6.8), or
(ii) rights, options or warrants (excluding those referred
to in paragraph (b) of this clause 6.8), or
(iii) evidences of its indebtedness (excluding indebtedness
convertible into common shares
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referred to in paragraph (a) of this clause 6.8), or
(iv) assets (excluding common shares issued by way of a
stock dividend and cash dividends declared payable in
the ordinary course),
then in each such case the Conversion Rate shall be adjusted
immediately after such record date so that it shall equal the
rate determined by multiplying the Conversion Rate in effect
on such record date by a fraction, of which the denominator
shall be the total number of common shares outstanding on such
record date multiplied by the Current Market Price per common
share on such record date, less the fair market value (as
determined by the Board of Directors, whose determination
shall be conclusive) of such shares or rights, options or
warrants or evidences of indebtedness or assets so
distributed, and of which the numerator shall be the total
number of common shares outstanding on such record date
multiplied by such Current Market Price per common share; any
common shares owned by or held for the account of the
Corporation shall be deemed not to be outstanding for the
purpose of any such computation; such adjustment shall be made
successively whenever such a record date
- 33 -
is fixed; to the extent that such distribution is not so made,
the Conversion Rate shall be readjusted to the Conversion Rate
which would then be in effect based upon such shares or
rights, options or warrants or evidences of indebtedness or
assets actually distributed.
(d) for the purpose of any such computation under paragraphs (b)
or (c) of this clause 6.8, the "Current Market Price" for a
common share at any date shall be determined by the Board of
Directors; provided that when the common shares are listed on
The Toronto Stock Exchange or on any other stock exchange in
Canada, the "Current Market Price" per common share at any
date shall be the weighted average closing price at which the
common shares of the Corporation traded on The Toronto Stock
Exchange (or if the common shares are not then listed and
posted for trading on The Toronto Stock Exchange, on such
stock exchange in Canada on which such shares are listed and
posted for trading as may be selected for such purpose by the
Board of Directors) during the 30 trading days (on each of
which at least 100 common shares were traded in at least one
board lot) immediately preceding the fifth trading day before
such date.
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(e) no adjustments of the Conversion Rate shall be made pursuant
to paragraphs (b) or (c) of this clause 6.8 in respect of any
rights, options or warrants if identical rights, options or
warrants are issued to the holders of the Series H Preference
Shares as though and to the same effect as if they had
converted their Series H Preference Shares into common shares
prior to the issue of such rights, options or warrants.
(f) in any case in which this clause 6.8 shall require that an
adjustment shall become effective immediately after a record
date for an event referred to herein, the Corporation may
defer, until the occurrence of such event, issuing to the
holder of any Series H Preference Shares converted after such
record date and before the occurrence of such event, the
additional common shares issuable upon such conversion by
reason of the adjustment required by such event in addition to
the common shares issuable upon such conversion before giving
effect to such adjustment, provided, however, that the
Corporation shall deliver to such holder an appropriate
instrument evidencing such holder's rights to receive such
additional common shares upon the occurrence of the event
requiring such adjustment and the right to receive any
distributions on such additional common shares declared in
favour of holders
- 35 -
of record of common shares on or after the relevant date of
conversion.
(g) in the case of any reclassification of, or other change in,
the outstanding common shares other than a subdivision or
consolidation, the right of conversion shall be adjusted
immediately after the effective date for such reclassification
or other change so that holders of Series H Preference Shares
shall be entitled to receive such number of shares as they
would have received had such Series H Preference Shares been
converted into common shares of the Corporation immediately
prior to such reclassification or other change becoming
effective.
(h) no adjustment in the Conversion Rate shall be required unless
such adjustment would require an increase or decrease of at
least 1% in the conversion Price, provided, however, that any
adjustments which by reason of this paragraph (h) are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment. "Conversion Price" at
any time means an amount equal to the Purchase Price divided
by the Conversion Rate in effect at such time.
- 36 -
(i) if any question shall at any time arise with respect to the
Conversion Price or any adjustments in the amount of the
Conversion Rate or with respect to the amount of any cash
payment made in lieu of issuing a fractional share, such
question shall be conclusively determined by the auditors from
time to time of the Corporation and shall be binding upon the
Corporation and all shareholders, transfer agents and
registrars of Series H Preference Shares and of common shares.
(j) for the purpose of this clause 6.8, "dividends declared
payable in the ordinary course" shall mean dividends paid on
the common shares in any fiscal year of the Corporation,
whether in (1) cash, (2) securities of the Corporation,
including rights, options or warrants (other than rights,
options or warrants referred to in paragraph (b) of clause
6.8) to purchase any securities of the Corporation or property
or other assets of the Corporation, or (3) property or other
assets of the Corporation, to the extent that the amount or
value of such dividend together with the amount or value of
all dividends theretofore paid during such fiscal year (any
such securities, property or other assets so distributed to be
valued at the fair market value of such securities, property
or other assets, as the case may be, as determined by the
Board of Directors, which
- 37 -
determination shall be conclusive) does not exceed the greater
of:
(i) 150% of the aggregate amount or value of dividends
paid by the Corporation on the common shares in the
period of twelve consecutive months ended immediately
prior to the first day of such fiscal year; or
(ii) 100% of the consolidated net income of the
Corporation before extraordinary items for the period
of twelve consecutive months ended immediately prior
to the first day of such fiscal year less the amount
of all dividends payable in respect of such
consecutive twelve-month period on all shares ranking
prior to or on a parity with the common shares in
respect of the payment of dividends (such
consolidated net income, extraordinary items and
dividends to be shown in the audited consolidated
financial statements of the Corporation for such
period of twelve consecutive months or if there are
no audited consolidated financial statements for such
period, computed in accordance with generally
accepted accounting principles, consistent with those
applied in the preparation of the most
- 38 -
recent audited consolidated financial statements of
the Corporation); or
(iii) 300% of the arithmetic mean of the aggregate amount
and/or value of the dividends paid by the Corporation
on the common shares during the period of those
12-month periods comprising the 36 consecutive months
ended immediately prior to the first day of such
fiscal year;
and for the purposes of subclauses (i), (ii) and (iii) above,
in determining the amount or value of dividends on the common
shares there shall be included, in respect of any period prior
to September 17, 1985, the amount or value of dividends paid
by any predecessor corporation on its common shares (excluding
the amount and/or value of dividends paid by any predecessor
corporation to another predecessor corporation).
6.9 Certificate as to Adjustment
Forthwith after the occurrence of any adjustment in the
Conversion Rate pursuant to clause 6.8 hereof, the corporation shall file with
the transfer agent of the Corporation for the Series H Preference Shares a
certificate certifying as to the amount of such adjustment and, in reasonable
detail, the event
- 39 -
requiring and the manner of completing such adjustment; the Corporation shall
also at such time give written notice to the holders of Series H Preference
Shares of the Conversion Rate following such adjustment.
6.10 Notification
If the Corporation intends to take any action which would require an
adjustment of the Conversion Rate pursuant to paragraph (a), (b) or (c) of
clause 6.3 hereof (other than the subdivision or consolidation of the
outstanding common shares of the Corporation), the Corporation shall, at least
14 days prior to the earlier of any record date fixed for any action or the
effective date for such action notify the holders of Series H Preference Shares
by written notice setting forth the particulars of such action to the extent
that such particulars have been determined at the time of giving the notice.
7. Purchase for Cancellation
Subject to applicable law, the Corporation may at any time or
from time to time purchase for cancellation all or any part of the outstanding
Series H Preference Shares at any price by tender to all the holders of record
of Series H Preference Shares then outstanding or through the facilities of any
stock exchange on which the Series H Preference Shares are listed. If
- 40 -
in response to an invitation for tenders under the provisions of this clause 7,
more Series H Preference Shares are tendered at a price or prices acceptable to
the Corporation than the Corporation is prepared to purchase, then the Series H
Preference Shares to be purchased by the Corporation shall be purchased as
nearly as may be pro rata according to the number of shares tendered by each
holder who submits a tender to the Corporation, provided that when shares are
tendered at different prices, the pro rating shall be effected only with respect
to the shares tendered at the price at which more shares were tendered than the
Corporation is prepared to purchase after the Corporation has purchased all the
shares tendered at lower prices. If part only of the Series H Preference Shares
represented by a certificate shall be purchased, a new certificate for the
balance of such shares shall be issued at the expense of the Corporation.
8. Issuance of Additional Series A Preference Shares
Notwithstanding anything herein contained, the Corporation
may, without the approval of the holders of the Series H Preference Shares,
issue up to that number of additional Preference Shares having rights,
privileges, restrictions and conditions substantially similar to those attaching
to the Floating Rate Cumulative Convertible Preference
- 41 -
Shares Series A which has an aggregate issue price of not more than $23 million.
9. Voting Rights
Subject to applicable law, the holders of the Series H
Preference Shares shall not be entitled to receive notice of or to attend or to
vote at any meetings of shareholders of the Corporation.
10. Liquidation, Dissolution or Winding Up
In the event of the liquidation, dissolution or winding up of
the Corporation, whether voluntary or involuntary, or in the event of any other
distribution of assets of the Corporation among its shareholders for the purpose
of winding up its affairs, the holders of the Series H Preference Shares shall
be entitled to receive from the assets of the Corporation an amount per share
equal to the Redemption Price plus all accrued and unpaid dividends thereon to
but excluding the date of payment, before any amount shall be paid to, or assets
of the Corporation distributed amongst, the holders of any other shares of the
Corporation ranking as to capital junior to the Series H Preference Shares.
After payment to the holders of the Series H Preference Shares of the amounts so
payable to them, they shall
- 42 -
not be entitled to share in any further distribution of the assets of the
Corporation.
11. Interpretation
In the event that any date on which any dividend on the Series
H Preference Shares is payable by the Corporation, or on or by which any other
action is required to be taken by the Corporation hereunder, is not a Business
Day, then such dividend shall be payable, or such other action shall be required
to be taken, on or by the next succeeding day that is a Business Day.
For the purposes of these share provisions:
(a) "Business Day" means a day other than a Saturday, a Sunday or
any other day that is treated as a statutory holiday in the
jurisdiction in which the Corporation's registered office is
located; and
(b) "ranking as to capital" means ranking with respect to the
distribution of assets in the event of a liquidation,
dissolution or winding up of the Corporation, whether
voluntary or involuntary, or in the event of any other
distribution of assets of the
- 43 -
Corporation among its shareholders for the purposes of winding
up its affairs.
12. Notice
Any notice, payment, request or demand (herein collectively
called a "Notice") required or permitted to be given or made hereunder shall be
in writing and shall be sufficiently given if delivered to the Corporation or to
the shareholder, as the case may be, or if sent by prepaid registered mail,
addressed, in the case of any Notice to the Corporation, to The Secretary,
Hollinger Inc., 10 Toronto Street, Toronto, Ontario, M5C 2B7, and in the case of
the shareholder, to such shareholder at the address set forth in the share
register of the Corporation, provided that the Corporation or the shareholder
may by notice in writing change its or the shareholder's address to a different
address stipulated in the Notice. Any Notice delivered by hand shall be
considered to have been given on the date of delivery. Any Notice mailed as
aforesaid shall be deemed to have been given on the third business day following
the date of such mailing.
- 44 -
13. Mail Service Interruption
If the Corporation determines that mail service is or is
threatened to be interrupted at the time when the Corporation is required or
elects to give any notice hereunder, or is required to send any cheque or any
share certificate to the holder of any Series H Preference Share, whether in
connection with the redemption of such share or otherwise, the Corporation may,
notwithstanding the provisions hereof:
(a) give such notice by delivery thereof to the holders of Series
H Preference Shares or by publication thereof once in a daily
English language newspaper of general circulation published in
Toronto and such notice shall be deemed to have been validly
given on the day next succeeding its delivery or publication,
as the case may be; and
(b) fulfill the requirement to send such cheque or such share
certificate by arranging for the delivery thereof to such
holder by the Corporation or by the transfer agent for the
Series H Preference Shares at its principal office in the city
of Toronto, and such cheque and/or certificate shall be deemed
to have been sent on the date on which notice of such
arrangement shall have been given as provided in (a) above,
- 45 -
provided that as soon as the Corporation determines that mail
service is no longer interrupted or threatened to be
interrupted, such cheque or share certificate, if not
theretofor delivered to such holder, shall be sent by mail as
herein provided. In the event that the Corporation is required
to mail such cheque or share certificate, such mailing shall
be made by prepaid mail to the registered address of each
person who at the date of mailing is a registered holder and
who is entitled to receive such cheque or certificate.
14. Amendments
The rights, privileges, restrictions and conditions attached
to the Series H Preference Shares may be added to, changed or removed by
Articles of Amendment but only with the prior approval of the holders of the
Series H Preference Shares given as specified in clause 15 and as may then be
required by law.
- 46 -
15. Approval of Holders of Series H Preference Shares
15.1 Approval
Any approval of the holders of the Series H Preference Shares
with respect to any matters requiring the consent of the holders of the Series
H Preference Shares may be given in such manner as may then be required by law,
subject to a minimum requirement that such approval be given by resolution
signed by all the holders of outstanding Series H Preference Shares or passed
by the affirmative vote of at least 66-2/3% of the votes cast by the holders of
Series H Preference Shares who voted in respect of that resolution at a meeting
of the holders of the Series H Preference Shares duly called for that purpose
and at which a quorum as required by the by-laws of the Corporation is present.
15.2 Formalities, etc.
The proxy rules applicable to, the formalities to be observed
in respect of the giving of notice of, and the formalities to be observed in
respect of the conduct of, any meeting or any adjourned meeting of holders of
Series H Preference Shares shall be those from time to time prescribed by the
by-laws of the Corporation with respect to meetings of shareholders or, if not
so prescribed, as required by law. On
- 47 -
every poll taken at every meeting of holders of Series H Preference Shares, each
holder of Series H Preference Shares entitled to vote thereat shall have one
vote in respect of each Series H Preference Share held.