EXHIBIT 1
[GRAPHIC]
GEAC COMPUTER CORPORATION LIMITED
NOTICE AND MANAGEMENT PROXY CIRCULAR
FOR THE 2003 ANNUAL AND SPECIAL
MEETING OF SHAREHOLDERS
TO BE HELD AT
The Design Exchange, Trading Floor
234 Bay Street, Toronto-Dominion Centre
Toronto, Ontario
Wednesday, September 10, 2003
10:00 a.m. (Toronto Time)
[GRAPHIC]
GEAC COMPUTER CORPORATION LIMITED
NOTICE OF THE ANNUAL AND SPECIAL
MEETING OF SHAREHOLDERS TO BE HELD
WEDNESDAY, SEPTEMBER 10, 2003
Notice is hereby given that the Annual and Special Meeting of
Shareholders of Geac Computer Corporation Limited (the "Corporation") will be
held at The Design Exchange, Trading Floor, 234 Bay Street, Toronto-Dominion
Centre, Toronto, Ontario, on Wednesday, September 10, 2003, at 10:00 a.m.
(Toronto time) (the "Meeting") for the following purposes:
1. to receive the annual report of the Corporation, which
contains the audited comparative consolidated financial
statements of the Corporation as at and for the fiscal year
ended April 30, 2003, and the report of the auditors thereon;
2. to elect the Directors of the Corporation;
3. to appoint auditors of the Corporation and to authorize the
Board of Directors to fix the auditors' remuneration;
4. to consider and, if thought advisable, to pass, with or
without variation, a resolution (the full text of which is
reproduced as Schedule A to the accompanying Management Proxy
Circular) approving a new 2003 Employee Stock Purchase Plan to
replace the Corporation's existing employee stock purchase
plan;
5. to consider and, if thought advisable, to pass, with or
without variation, a resolution (the full text of which is
reproduced as Schedule B to the accompanying Management Proxy
Circular) approving the reconfirmation and amendment of the
Corporation's Shareholder Protection Rights Plan;
6. to consider and, if thought advisable, to pass, with or
without variation, a special resolution (the full text of
which is reproduced as Schedule C to the accompanying
Management Proxy Circular) authorizing the Corporation to
amend its articles to change the Corporation's name to "Geac
Inc."; and
7. to transact such further and other business as may properly
come before the Meeting or any adjournment thereof.
The specific details of the foregoing matters to be put before the
Meeting or any adjournment thereof are set forth in the Management Proxy
Circular accompanying this Notice of Meeting.
Shareholders are invited to attend the Meeting. Registered shareholders
who are unable to be present in person at the Meeting are requested to complete,
date and sign the enclosed form of proxy and return it in the enclosed envelope
or otherwise to the Registrar and Transfer Agent of the Corporation,
Computershare Trust Company of Canada, Proxy Department, at 100 University
Avenue, 9th Floor, Toronto, Ontario M5J 2Y1, fax number 416.263.9524 or
toll-free fax number 1.866.249.7775. Non-registered shareholders who receive
these materials through their broker or other intermediary should complete and
send the form of proxy in accordance with the instructions provided by their
broker or intermediary. To be effective, a proxy must be received by
Computershare Trust Company of Canada not less than 48 hours (excluding
Saturdays, Sundays and holidays) before the time for holding the Meeting or any
adjournment thereof (the "Deposit Deadline"). The Corporation may waive
compliance with the preceding sentence and accept proxies deposited after the
Deposit Deadline but before the commencement of the Meeting or any adjournment
thereof.
Dated at Toronto, Ontario, as of the 1st day of August, 2003.
By Order of the Board of Directors
[GRAPHIC]
Craig C. Thorburn
Corporate Secretary
TABLE OF CONTENTS
PAGE
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GENERAL PROXY INFORMATION 1
Solicitation of Proxies 1
Appointment of Proxyholder 1
Revocation of Proxy 1
Voting of Proxies 2
Voting Shares and Record Date 2
Principal Shareholders 2
Questions and Further Assistance 2
1. ELECTION OF DIRECTORS 3
Thomas I. A. Allen, Q.C. 4
David Friend 4
C. Kent Jespersen 4
Charles S. Jones 4
Pierre MacDonald 4
Michael D. Marvin 5
William G. Nelson 5
Robert L. Sillcox 5
2. APPOINTMENT OF AUDITORS 5
3. APPROVAL OF NEW 2003 EMPLOYEE STOCK PURCHASE PLAN 6
Background 6
Summary of Changes between Old ESPP and New ESPP 6
Approval 7
4. APPROVAL OF THE CONTINUATION OF THE SHAREHOLDER PROTECTION RIGHTS PLAN
AND THE AMENDED AND RESTATED SHAREHOLDER PROTECTION RIGHTS PLAN 7
Background 7
Summary of the Amended Plan and Copy of the Agreement 8
Objectives of the Amended Plan 8
General Impact of the Amended Plan 9
Canadian Federal Income Tax Consequences 9
United States Federal Income Tax Consequences 10
Eligibility for Investment in Canada 10
Recommendation of the Board of Directors 10
Approval 10
5. APPROVAL OF NAME CHANGE TO "GEAC INC." 10
SUMMARY COMPENSATION TABLE 11
OPTIONS OF NAMED EXECUTIVE OFFICERS 12
Option Grants during the Fiscal Year Ended April 30, 2003 12
Aggregated Option Exercises during the Most Recently Completed Fiscal Year and Fiscal Year-End
Option Values 13
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS 14
EMPLOYMENT CONTRACTS 14
Paul D. Birch 14
Arthur Gitajn 14
Bertrand Sciard 15
John L. Sherry, III 15
James M. Travers 15
REPORT ON EXECUTIVE COMPENSATION 16
COMPENSATION OF DIRECTORS 17
DIRECTORS' AND OFFICERS' INSURANCE 17
STATEMENT OF CORPORATE GOVERNANCE PRACTICES 17
PERFORMANCE GRAPH 18
SHAREHOLDER PROPOSALS 18
DIRECTORS' APPROVAL 18
SCHEDULE A: RESOLUTION TO APPROVE NEW 2003 EMPLOYEE STOCK PURCHASE PLAN 19
SCHEDULE B: RESOLUTION TO RECONFIRM AND AMEND THE SHAREHOLDER PROTECTION RIGHTS PLAN 20
SCHEDULE C: RESOLUTION TO CHANGE THE NAME OF THE CORPORATION TO "GEAC INC." 21
APPENDIX A: AMENDED AND RESTATED SHAREHOLDER PROTECTION RIGHTS PLAN SUMMARY 22
Issuance of Rights 22
Exercise Price 22
Term 22
Trading of Rights 22
Separation Time 22
Acquiring Person 23
Beneficial Ownership 23
Exclusions from the Definition of Beneficial Ownership 23
Flip-in Event 25
Permitted Bid and Competing Permitted Bid 25
Redemption 25
Waiver 26
Supplements and Amendments 26
Anti-Dilution Adjustments 27
APPENDIX B: STATEMENT OF CORPORATE GOVERNANCE PRACTICES 28
[GRAPHIC]
GEAC COMPUTER CORPORATION LIMITED
MANAGEMENT PROXY CIRCULAR
FOR THE ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS
WEDNESDAY, SEPTEMBER 10, 2003
GENERAL PROXY INFORMATION
SOLICITATION OF PROXIES
THIS MANAGEMENT PROXY CIRCULAR (THE "CIRCULAR") IS FURNISHED IN
CONNECTION WITH THE SOLICITATION OF PROXIES BY AND ON BEHALF OF THE MANAGEMENT
OF GEAC COMPUTER CORPORATION LIMITED (THE "CORPORATION") FOR USE AT THE ANNUAL
AND SPECIAL MEETING OF THE HOLDERS OF COMMON SHARES (THE "COMMON SHARES") OF THE
CORPORATION TO BE HELD AT THE DESIGN EXCHANGE, TRADING FLOOR, 234 BAY STREET,
TORONTO-DOMINION CENTRE, TORONTO, ONTARIO, ON WEDNESDAY, SEPTEMBER 10, 2003, AT
10:00 A.M. (TORONTO TIME) (THE "MEETING") OR ANY ADJOURNMENT THEREOF FOR THE
PURPOSES SET FORTH IN THE ACCOMPANYING NOTICE OF THE ANNUAL AND SPECIAL MEETING
OF SHAREHOLDERS OF THE CORPORATION (THE "NOTICE OF MEETING"). The solicitation
will be made primarily by mail, but proxies may be solicited personally or by
telephone by Directors, Officers or employees of the Corporation without special
compensation, or by the Corporation's registrar and transfer agent,
Computershare Trust Company of Canada ("Computershare"), at nominal cost. The
Corporation has retained, for a fee, the services of Georgeson Shareholder
Communications Canada Inc. to assist it in the solicitation of proxies from the
shareholders of the Corporation for the Meeting. The Corporation may also
retain, and pay a fee to, one or more other professional proxy solicitation
firms to solicit proxies from the shareholders of the Corporation. The cost of
solicitation will be borne by the Corporation.
APPOINTMENT OF PROXYHOLDER
The persons named in the enclosed form of proxy are Directors or
Officers of the Corporation. A SHAREHOLDER HAS THE RIGHT TO APPOINT AS HIS OR
HER PROXYHOLDER SOME OTHER PERSON (WHO NEED NOT BE A SHAREHOLDER OF THE
CORPORATION) TO ATTEND AND TO ACT ON HIS OR HER BEHALF AT THE MEETING OR AT ANY
ADJOURNMENT THEREOF. A shareholder may exercise this right by inserting the name
of the shareholder's chosen proxy in the blank space provided in the proxy or by
completing another proper form of proxy. In the case of registered shareholders,
the completed, dated and signed form of proxy should be sent in the enclosed
envelope or otherwise to Computershare, Proxy Department, at 100 University
Avenue, 9th Floor, Toronto, Ontario M5J 2Y1, fax number 416.263.9524 or
toll-free fax number 1.866.249.7775. In the case of non-registered shareholders
who receive these materials through their broker or other intermediary,
shareholders should complete and send the form of proxy in accordance with the
instructions provided by their broker or other intermediary. To be valid, a
proxy must be received by Computershare not less than 48 hours (excluding
Saturdays, Sundays and holidays) before the time for holding the Meeting or any
adjournment thereof (the "Deposit Deadline"). The Corporation may waive
compliance with the preceding sentence and accept proxies deposited after the
Deposit Deadline but before the commencement of the Meeting or any adjournment
thereof.
REVOCATION OF PROXY
A shareholder who has given a proxy may revoke it by depositing an
instrument in writing signed by the shareholder or by the shareholder's
attorney, who is authorized in writing, at the registered office of the
Corporation at 11 Allstate Parkway, Suite 300, Markham, Ontario L3R 9T8
(Attention: Corporate Secretary) at any time up to and including the last
business day preceding the day of the Meeting, or, in the case of any
adjournment of the Meeting, the last business day preceding the day of the
adjournment, or with the Chair of the Meeting on the day of, and prior to the
start of, the Meeting or any adjournment thereof. A shareholder may also revoke
a proxy in any other manner permitted by law.
VOTING OF PROXIES
On any vote that may be called for, the Common Shares of the
Corporation represented by a properly executed proxy given in favour of the
person(s) named in the enclosed form of proxy will be voted for, voted against
or withheld from voting, in accordance with the specifications made therein. IF
NO CHOICE IS SPECIFIED IN THE PROXY, THE PERSON DESIGNATED IN THE ACCOMPANYING
FORM OF PROXY WILL VOTE IN FAVOUR OF ALL MATTERS TO BE ACTED UPON AS SET OUT IN
THIS CIRCULAR AND IN FAVOUR OF ALL OTHER MATTERS PROPOSED BY MANAGEMENT AT THE
MEETING.
The enclosed form of proxy confers discretionary authority upon the
person(s) named therein with respect to amendments or variations to matters
identified in the Notice of Meeting and with respect to other matters which may
properly come before the Meeting or any adjournment thereof. As of the date of
this Circular, management of the Corporation is not aware of any such amendment,
variation or other matter to come before the Meeting. However, if any amendments
to matters identified in the accompanying Notice of Meeting or other matters
which are not now known to management should properly come before the Meeting,
the Common Shares represented by properly executed proxies given in favour of
the persons designated by management of the Corporation in the enclosed proxy
form will be voted on such matters pursuant to such discretionary authority.
VOTING SHARES AND RECORD DATE
As at July 28, 2003, the Corporation had 84,164,427 Common Shares
outstanding, each carrying the right to one vote per share. A simple majority of
the votes cast at the Meeting, whether in person, by proxy or otherwise, will
constitute approval of any matter submitted to a vote other than a special
resolution, which requires a majority of not less than two-thirds of the votes
cast at the Meeting.
The Board of Directors has fixed Tuesday, August 5, 2003, as the record
date for the purpose of determining holders of Common Shares entitled to receive
notice of and vote at the Meeting. Any holder of Common Shares of record at the
close of business on the record date is entitled to vote the Common Shares
registered in such shareholder's name at that date on each matter to be acted on
at the Meeting.
PRINCIPAL SHAREHOLDERS
To the knowledge of the Directors and senior Officers of the
Corporation, as at July 28, 2003, no person beneficially owns directly or
indirectly, or exercises control or direction over, more than 10% of the voting
rights attached to the outstanding Common Shares of the Corporation.
QUESTIONS AND FURTHER ASSISTANCE
If you have any questions about the information contained in this
Circular or require assistance in completing your proxy form, please contact
Georgeson Shareholder Communications Canada Inc., the Corporation's proxy
solicitation agent, at:
[GRAPHIC]
66 Wellington Street West
TD Tower -- Suite 5210
Toronto Dominion Centre
Toronto, Ontario M5K 1J3
Toll-Free Number:
1-866-261-2557
MATTERS TO BE ACTED UPON AT THE MEETING
1. ELECTION OF DIRECTORS
The articles of the Corporation provide for a Board of Directors
consisting of a minimum of three (3) and a maximum of fifteen (15) Directors. At
the Meeting, the shareholders will be asked to elect as Directors of the
Corporation the eight (8) nominees listed herein to serve for a term expiring at
the next annual meeting of shareholders, unless such Director resigns or is
removed, or his office is otherwise vacated, in accordance with the Canada
Business Corporations Act.
The following table sets out the name and municipality of residence of
each person to be nominated for election as a Director of the Corporation, his
principal occupation or employment, the year he first became a Director of the
Corporation and the number of Common Shares that he has advised the Corporation
are beneficially owned by him or subject to his control or direction as at the
date of this Circular:
YEAR FIRST BECAME A COMMON SHARES
NAME AND MUNICIPALITY DIRECTOR OF THE BENEFICIALLY OWNED OR
OF RESIDENCE PRINCIPAL OCCUPATION CORPORATION CONTROLLED(1)
THOMAS I. A. ALLEN, Q.C.(2)(4*) Senior Partner 1999 nil
Toronto, Ontario Ogilvy Renault, law firm
DAVID FRIEND Partner 2001 10,000
Boston, Massachusetts Orchid Partners,
venture capital firm
C. KENT JESPERSEN(2)(3)** Chairman of the Corporation 2001 5,180
Calgary, Alberta and Chairman
La Jolla Resources
International Ltd., business
advisory & investment company
CHARLES S. JONES President and Chief 1997 37,240
Bedford Hills, New York Executive Officer of the
Corporation
PIERRE MACDONALD(2)(3*) Chairman and Chief Executive 1999 1,950
Verdun, Quebec Officer
MacD Consult Inc.,
consulting firm
MICHAEL D. MARVIN(3) Chairman Emeritus 2001 60,000
Delmar, New York MapInfo Corporation,
software technology company
WILLIAM G. NELSON(2)(4) Chairman 1988 1,800,000
Bala Cynwyd, Pennsylvania Harris Business Group, Inc.,
software technology company
ROBERT L. SILLCOX(2*)(4) Chairman 2001 5,000
King City, Ontario Quant Investment
Strategies Inc., investment
firm
NOTES:
(1) Does not include Common Shares issuable upon exercise of options.
(2) Member of Audit Committee.
(3) Member of Human Resources and Compensation Committee.
(4) Member of Corporate Governance Committee.
* Denotes Committee Chairman.
** Denotes Chairman of the Board of Directors.
The Corporation does not have an executive committee of the Board of
Directors to which powers of the Board have been delegated.
THOMAS I. A. ALLEN, Q.C.
Mr. Thomas I. A. Allen, Q.C. was first elected to the Board of
Directors of the Corporation in September 1999. He is the Chairman of the
Accounting Standards Oversight Council of Canada and is a member of the Advisory
Board of the Office of the Superintendent of Financial Institutions of Canada.
Mr. Allen has been a partner at the law firm of Ogilvy Renault since October
1996. Mr. Allen is a director of the following public corporations: Bema Gold
Corporation, YM Biosciences Inc., Middlefield Bancorp Limited, Mundoro Mining
Inc. and Unisphere Waste Conversion Limited.
DAVID FRIEND
Mr. David Friend was first elected to the Board of Directors of the
Corporation in October 2001. Mr. Friend is a Partner with Orchid Partners, a
venture capital firm. Mr. Friend is also the Chairman of Sonexis, Inc.
("Sonexis"), a telecommunications software and platform provider, a company he
founded in June 1999. Prior to founding Sonexis, he was the Chairman and
co-founder of FaxNet Corporation ("FaxNet"), a supplier of messaging services to
the telecommunications industry, where he served from January 1995 to May 1999.
Prior to founding FaxNet, Mr. Friend founded Pilot Software, Inc., a software
company based in Cambridge, Massachusetts, where he served from November 1983 to
November 1994. Mr. Friend is an active venture investor and serves on the board
of directors of HealthGate Data Systems, Inc.
C. KENT JESPERSEN
Mr. C. Kent Jespersen was first elected to the Board of Directors of
the Corporation in October 2001. Mr. Jespersen has served as the Chairman of the
Corporation's Board of Directors since July 2003. Mr. Jespersen has been the
Chairman of La Jolla Resources International Ltd., an international business
advisory and investment company, since 1998. From 1994 to 1998, Mr. Jespersen
held the positions of President of NOVA Gas International Ltd., President and
Chief Executive Officer Elect of NOVA Energy Services, President of NOVA Gas
Services Ltd., and Senior Vice President, Corporate Development of NOVA
Corporation. Mr. Jespersen currently serves as the Chairman of the board of
directors of CCR Technologies Ltd. and is Chairman Emeritus of the Institute of
the Americas of La Jolla, California. He also serves as a director of
Telesystems International Wireless Inc., Axia NetMedia Corporation, Bow Valley
Energy Ltd. and Matrikon, Inc.
CHARLES S. JONES
Mr. Charles S. Jones was first elected to the Board of Directors of the
Corporation in September 1997. Mr. Jones served as Chairman of the Corporation's
Board of Directors from November 2000 until July 2003.
Mr. Jones was appointed the President and Chief Executive Officer of the
Corporation in July 2003. Mr. Jones is also the Chairman and co-founder of First
Funding Corporation, an investment firm based in Stamford, Connecticut, where he
has worked since 1984. Currently, Mr. Jones serves as a director of Farrel
Corporation and a number of diverse companies, from an industrial equipment
manufacturer to a computer games designer and publisher.
PIERRE MACDONALD
Mr. Pierre MacDonald was first elected to the Board of Directors of the
Corporation in September 1999. Since March 1995, Mr. MacDonald has served as
Chairman and Chief Executive Officer of MacD Consult Inc., a group of
consultants in international finance and marketing. Since May 2000, Mr.
MacDonald has served as the Vice-Chairman of the board of directors of the
Export Development Corporation, a Crown corporation that operates as a financial
institution devoted exclusively to providing trade finance services in support
of Canadian exporters and investors in up to 200 countries. Mr. MacDonald began
serving as a director of Export Development Corporation in August 1995. He also
serves as a director of Aeterna Laboratories Inc., AIM Canada Fund Inc., AIM
Global Fund Inc., Slater Steel Inc. and Sodisco-Howden Group Inc.
MICHAEL D. MARVIN
Mr. Michael D. Marvin was appointed to the Board of Directors of the
Corporation in August 2001. Mr. Marvin is the founder and Chairman Emeritus of
MapInfo Corporation ("MapInfo"), a software technology company specializing in
location based solutions and services that help businesses better understand
their customers and markets. Mr. Marvin was the Chairman of MapInfo from 1992
until January 2001.
WILLIAM G. NELSON
Mr. William G. Nelson was first elected to the Board of Directors of
the Corporation in September 1988. He served as Chairman of the Corporation's
Board of Directors from June 1996 to October 2000, and as the Corporation's
President and Chief Executive Officer from September 1996 to April 1999. Mr.
Nelson has served as Chief Executive Officer of Clarendon Capital Inc., an
investment banking and consulting firm, since June 1995. Mr. Nelson has been the
Chairman of the board of directors of Harris Business Group, Inc. since 1990 and
the Chairman of the board of directors of Repository Technologies, Inc., a
computer software company, since 1999. Mr. Nelson is also a director of
Manugistics Group, Inc., a provider of intelligent supply chain optimization
solutions for enterprises and evolving eBusiness trading networks, HealthGate
Data Corp., a provider of eHealth Internet solutions for hospitals and
healthcare enterprises, and Catalyst International Inc., a global provider of
software and services for warehouse management.
ROBERT L. SILLCOX
Mr. Robert L. Sillcox was appointed to the Corporation's Board of
Directors in August 2001. Mr. Sillcox is the Chairman of Quant Investment
Strategies Inc., an investment firm specializing in providing quantitative
investment strategies to institutions. He has held this position since he
co-founded the firm in 1998. Mr. Sillcox is currently also a director of the
Bank of China (Canada), a Canadian chartered bank, Glenmount International,
L.P.I., an industrial technology private equity partnership, and HelpCaster
Technologies Inc., a software technology company.
IN THE ABSENCE OF A CONTRARY INSTRUCTION, THE PERSONS DESIGNATED BY
MANAGEMENT OF THE CORPORATION IN THE ENCLOSED FORM OF PROXY INTEND TO VOTE FOR
THE ELECTION AS DIRECTORS OF THE PROPOSED NOMINEES WHOSE NAMES ARE SET FORTH
ABOVE, EACH OF WHOM HAS BEEN A DIRECTOR SINCE THE DATE INDICATED ABOVE OPPOSITE
THE PROPOSED NOMINEE'S NAME. Management does not contemplate that any of the
proposed nominees will be unable to serve as a Director, but if that should
occur for any reason prior to the Meeting, the Common Shares represented by
properly executed proxies given in favour of such nominee(s) may be voted by the
persons designated by management of the Corporation in the enclosed form of
proxy, in their discretion, in favour of another nominee.
2. APPOINTMENT OF AUDITORS
IN THE ABSENCE OF A CONTRARY INSTRUCTION, THE PERSONS DESIGNATED BY
MANAGEMENT OF THE CORPORATION IN THE ENCLOSED FORM OF PROXY INTEND TO VOTE FOR
THE RE-APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS AUDITORS OF THE CORPORATION
TO HOLD OFFICE UNTIL THE NEXT ANNUAL MEETING OF SHAREHOLDERS OR UNTIL A
SUCCESSOR IS APPOINTED AND THE AUTHORIZATION OF THE BOARD OF DIRECTORS TO FIX
THE REMUNERATION OF THE AUDITORS. The resolution appointing the auditors must be
approved by a majority of the votes cast by the holders of the Common Shares
present or represented by proxy at the Meeting. PricewaterhouseCoopers LLP was
first appointed as auditors of the Corporation at the Corporation's Annual and
Special Meeting of Shareholders held on September 14, 1999. Prior to the
appointment of PricewaterhouseCoopers LLP, the auditors of the Corporation were
Deloitte & Touche, initially appointed in 1988.
3. APPROVAL OF NEW 2003 EMPLOYEE STOCK PURCHASE PLAN
BACKGROUND
At the Corporation's Annual and Special Meeting on October 19, 2001,
the Corporation's shareholders approved an employee stock purchase plan (the
"Old ESPP") effective as of August 1, 2001. Under the Old ESPP, membership was
limited to employees resident in Canada after entering continuous full-time
employment with the Corporation or a subsidiary. The maximum number of Common
Shares issuable under the Old ESPP was 600,000. As at July 31, 2003, 83,956
Common Shares had been issued under the Old ESPP, leaving 516,044 additional
Common Shares eligible for issuance under the Old ESPP.
As the Old ESPP limited membership to employees resident in Canada, the
Board of Directors of the Corporation determined that employees of the
Corporation resident in the United States and other jurisdictions should also be
entitled to participate in a stock purchase plan so as to provide to as many
employees of the Corporation as possible an opportunity for share ownership and
to motivate and retain such employees. Accordingly, on August 1, 2003, the Board
of Directors, subject to approval of the Toronto Stock Exchange (the "TSX"),
approved the submission to the shareholders for approval of a new 2003 Employee
Stock Purchase Plan (the "New ESPP"). If the New ESPP receives shareholder and
other required regulatory approvals, it will become effective as of September
10, 2003 and the Board of Directors intends to terminate the Old ESPP
immediately, effective as of such date.
SUMMARY OF CHANGES BETWEEN OLD ESPP AND NEW ESPP
The New ESPP differs from the Old ESPP in the following key respects:
- the proposed number of Common Shares reserved for issuance
under the New ESPP is 2,000,000 Common Shares, an increase of
1,483,956 Common Shares over the 516,044 Common Shares that
remain available for issuance under the Old ESPP as at July
31, 2003;
- once enrolled in the New ESPP, an employee can make
contributions through payroll deductions of an amount equal to
a percentage of his or her compensation determined at the
commencement of an offering period in increments of one (1%)
per cent up to a maximum of ten (10%) per cent;
- the purchase price for Common Shares issued under the New ESPP
will be eighty-five (85%) per cent of the lesser of market
value of the Common Shares on the applicable offering
commencement date and the market value of the Common Shares on
the offering termination date;
- the New ESPP will be administered by a committee to be
established by the Board;
- employees' right to purchase shares under the New ESPP is
limited to a maximum of US$25,000 worth of Common Shares in
any calendar year;
- offering period commencement and termination dates are to be
selected by the committee administering the New ESPP in its
discretion, provided that an offering period can be no longer
than one year;
- the Corporation may, at its option, purchase shares to be
delivered under the New ESPP in the open market through an
Administrative Agent;
- under the New ESPP, neither the payroll deductions nor any
rights to receive Common Shares may be assigned, transferred,
pledged or otherwise disposed of except by will or laws of
descent and distribution;
- prior to an offering termination date, any participant in the
New ESPP can withdraw payroll deductions for such offering
period and a participant's withdrawal will not affect his or
her eligibility for subsequent offerings (upon termination of
a participant's employment for any reason other than death,
payroll deductions not applied to purchases of Common Shares
will be returned to the participant; on death, a participant's
beneficiary will have 90 days to withdraw the deductions or
exercise the option to acquire Common Shares); and
- the Board may at any time terminate or amend the New ESPP,
provided that, in certain circumstances, the prior consent of
the TSX and shareholders of the Corporation is obtained.
APPROVAL
At the Meeting, the shareholders will be asked to consider and, if
thought advisable, to approve, with or without variation, a resolution (the
"Stock Purchase Plan Resolution") authorizing the New ESPP. The text of the
Stock Purchase Plan Resolution is attached as Schedule A hereto.
The Stock Purchase Plan Resolution must be approved by a majority of
the votes cast by the holders of the Common Shares present or represented by
proxy at the Meeting, excluding insiders of the Corporation to whom Common
Shares may be issued under the New ESPP and their associates. To the knowledge
of the Corporation, the number of votes to be so excluded is approximately
40,000 as at July 31, 2003.
The Board of Directors reserves the right to withdraw its proposal to
approve the New ESPP at any time before its approval by the Shareholders, and
may terminate the New ESPP at any time after its approval by the Shareholders,
if the Board of Directors determines that such action would be in the best
interests of the Corporation.
The proposed number of Common Shares reserved for issuance under the
New ESPP of 2,000,000 Common Shares (being an increase of 1,483,956 Common
Shares over the 516,044 Common Shares that are available for issuance under the
Old ESPP as at July 31, 2003) is necessary to permit sufficient future issuances
of Common Shares under the New ESPP to achieve the Corporation's objective to
attract, motivate and retain employees. The New ESPP and the aggregate number of
Common Shares reserved for issuance under the New ESPP have been conditionally
approved by the TSX, subject to shareholder approval. The Board of Directors
recommends a vote "FOR" the Stock Purchase Plan Resolution and the aggregate
number of Common Shares reserved for issuance under the New ESPP. IN THE ABSENCE
OF A CONTRARY INSTRUCTION, THE PERSONS DESIGNATED BY MANAGEMENT OF THE
CORPORATION IN THE ENCLOSED FORM OF PROXY INTEND TO VOTE FOR THE FOREGOING
RESOLUTION.
4. APPROVAL OF THE CONTINUATION OF THE SHAREHOLDER PROTECTION RIGHTS PLAN
AND THE AMENDED AND RESTATED SHAREHOLDER PROTECTION RIGHTS PLAN
BACKGROUND
The Corporation and a predecessor to Computershare Trust Company of
Canada, as rights agent (the "Rights Agent"), originally entered into an
agreement dated March 15, 2000 to implement a shareholder protection rights plan
(the "Original Plan"), which was confirmed by the Corporation's shareholders at
the
annual and special meeting of the Corporation's shareholders held on September
12, 2000. Under the terms of the Original Plan, the continued existence of the
Original Plan must be approved and reconfirmed by the Independent Shareholders
(as defined in the Original Plan) on or before the date of the Corporation's
2003 annual meeting. An "Independent Shareholder" is generally any shareholder
other than an "Acquiring Person" (as defined in the Original Plan) and its
associates and affiliates. As of the date of this Circular, the Corporation is
not aware of any shareholder who would be considered not to be an Independent
Shareholder, and therefore it is anticipated that all shareholders will be
eligible to vote their Common Shares on the resolution set forth below.
The Corporation has reviewed its Original Plan for conformity with
current practices of Canadian issuers with respect to shareholder rights plan
design. Based on its review, the Corporation has determined that, since March
2000, when the Original Plan was implemented, the significant definitions, terms
and conditions of rights plans have not changed. As a result, on August 1, 2003,
the Board of Directors resolved to continue the Original Plan with certain
minimal amendments by approving an amended and restated shareholder rights plan
(the "Amended Plan") proposed to be dated as of September 10, 2003, subject to
regulatory approval and approval by the Independent Shareholders at the Meeting.
The Amended Plan is identical to the Original Plan in all material respects and
names Computershare Trust Company of Canada as the successor Rights Agent.
SUMMARY OF THE AMENDED PLAN AND COPY OF THE AGREEMENT
A summary of the key features of the Amended Plan is attached as
Appendix A to this Circular. All capitalized terms used in this section of the
Circular and Appendix A have the meanings set forth in the Amended Plan unless
otherwise indicated. The complete text of the Amended Plan is available on the
Corporation's website at www.geac.com and is available to any shareholder on
request from the Corporate Secretary of the Corporation. Shareholders wishing to
receive a copy of the Amended Plan should contact the Corporation by telephone
(905.475.0525 ext. 3325), by facsimile (905.940.3722) or by e-mail
(investor@geac.com).
OBJECTIVES OF THE AMENDED PLAN
The Amended Plan is not being adopted or approved to deter take-over
bids generally. The primary objectives of the Amended Plan, as with the Original
Plan, are to ensure that, in the context of a bid for control of the Corporation
through an acquisition of the Corporation's Common Shares, the Board of
Directors has sufficient time to explore and develop alternatives for maximizing
shareholder value, to provide adequate time for competing bids to emerge, to
ensure that shareholders have an equal opportunity to participate in such a bid
and to give them adequate time properly to assess the bid and lessen the
pressure to tender that may be encountered by a securityholder of an issuer that
is subject to a bid. The Amended Plan is not intended to prevent a change of
control of the Corporation in a transaction that is fair and in the best
interests of the Corporation and all of its shareholders. The rights of
shareholders to seek a change in the management of the Corporation or to
influence or promote action of management in a particular manner will not be
affected by the Amended Plan. The approval of the Amended Plan does not affect
the duty of a Director to act honestly and in good faith with a view to the best
interests of the Corporation and its shareholders.
In approving the Amended Plan, the Board of Directors considered the
following concerns inherent in the existing legislative framework governing
take-over bids in Canada:
(a) Time. Current legislation permits a take-over bid to expire in
thirty-five (35) days. The Board of Directors is of the view
that this may not be sufficient time to permit shareholders to
consider a take-over bid and to make a reasoned and considered
decision. The Amended Plan provides a mechanism whereby the
minimum expiry period for a Take-over Bid must be sixty (60)
days after the date of the bid and the bid must remain open
for a further period of ten (10) Business Days after the
Offeror publicly announces that the Common Shares deposited or
tendered and not withdrawn constitute more than 50% of the
Common Shares outstanding held by Independent Shareholders
(generally, shareholders other than the Offeror or Acquiring
Person (someone who beneficially owns greater than 20% of the
outstanding Common Shares), their
Associates and Affiliates, and Persons acting jointly or in
concert with the Offeror or Acquiring Person). The Amended
Plan is intended to provide shareholders with adequate time to
evaluate properly the offer and to provide the Board of
Directors with sufficient time to explore and develop
alternatives for maximizing shareholder value. Those
alternatives could include identifying other potential
bidders, conducting an orderly auction or developing a
restructuring alternative which could enhance shareholder
value.
(b) Pressure to Tender. A shareholder may feel pressured to tender
to a bid which the shareholder considers to be inadequate out
of a concern that failing to tender may result in the
shareholder being left with illiquid or minority discounted
securities in the Corporation. This is particularly so in the
case of a partial bid for less than all securities of a class,
where the bidder wishes to obtain a control position but does
not wish to acquire all of the Common Shares. The Amended Plan
provides a shareholder approval mechanism in the Permitted Bid
provision which is intended to ensure that a shareholder can
separate the tender decision from the approval or disapproval
of a particular take-over bid. By requiring that a bid remain
open for acceptance for a further ten (10) Business Days
following a public announcement that more than 50% of the
Common Shares held by Independent Shareholders have been
deposited, a shareholder's decision to accept a bid is
separated from the decision to tender, lessening the undue
pressure to tender typically encountered by a securityholder
of an issuer that is the subject of a take-over bid.
(c) Unequal Treatment. While existing securities legislation has
substantially addressed many concerns of unequal treatment,
there remains the possibility that control of an issuer may be
acquired pursuant to a private agreement in which a small
group of securityholders dispose of their securities at a
premium to market price which premium is not shared with other
securityholders. In addition, a person may slowly accumulate
securities through stock exchange acquisitions which may
result, over time, in an acquisition of control without
payment of fair value for control or a fair sharing of a
control premium among all securityholders. The Amended Plan
addresses these concerns by applying to all acquisitions of
greater than 20% of the Common Shares, to ensure better that
shareholders receive equal treatment.
GENERAL IMPACT OF THE AMENDED PLAN
It is not the intention of the Board of Directors, in continuing the
Corporation's shareholder rights plan, to secure the continuance of existing
Directors or management in office, nor to avoid a bid for control of the
Corporation in a transaction that is fair and in the best interests of the
Corporation and all of its shareholders. For example, through the Permitted Bid
mechanism, described in more detail in the summary contained in Appendix A,
shareholders may tender to a bid which meets the Permitted Bid criteria without
triggering the Amended Plan, regardless of the acceptability of the bid to the
Board of Directors. Furthermore, even in the context of a bid that does not meet
the Permitted Bid criteria, the Board of Directors will continue to be bound to
consider fully and fairly any bid for the Corporation's Common Shares in any
exercise of its discretion to waive application of the Amended Plan or redeem
the Rights. In all such circumstances, the Board of Directors must act honestly
and in good faith with a view to the best interests of the Corporation and its
shareholders.
The Amended Plan does not preclude any shareholder from utilizing the
proxy mechanism under the Canada Business Corporations Act and securities laws
to promote a change in the management or direction of the Corporation, and has
no effect on the rights of holders of outstanding Common Shares of the
Corporation to requisition a meeting of shareholders in accordance with the
provisions of applicable corporate and securities legislation, or to enter into
agreements with respect to voting their Common Shares. The definitions of
"Acquiring Person" and "Beneficial Ownership" have been developed to minimize
concerns that the plan may be inadvertently triggered or triggered as a result
of an overly-broad aggregating of holdings of institutional shareholders and
their clients.
The Amended Plan will not interfere with the day-to-day operations of
the Corporation. The issuance of the Rights does not in any way alter the
financial condition of the Corporation, impede its business plans or alter its
financial statements. In addition, the Amended Plan is initially not dilutive
and is not expected to have
any effect on the trading of Common Shares. However, if a Flip-in Event occurs
and the Rights separate from the Common Shares and become exercisable, as
described in the summary contained in Appendix A, reported earnings per share
and reported cash flow per share on a fully-diluted or non-diluted basis may be
affected. In addition, holders of Rights not exercising their Rights after a
Flip-in Event may suffer substantial dilution of their shareholdings in the
Corporation.
In summary, the Board of Directors believes the dominant effect of the
Amended Plan will be to enhance shareholder value and ensure equal treatment of
all shareholders in the context of an acquisition of control.
CANADIAN FEDERAL INCOME TAX CONSEQUENCES
The Corporation considers that the Rights, when issued, will have
negligible monetary value and therefore Canadian shareholders will not be
required to include any amount in income or be subject to withholding tax under
the Income Tax Act (Canada) (the "Tax Act") as a result of the issuance of the
Rights. The Rights will be considered to have been acquired at no cost.
The holders of Rights may have income or be subject to withholding tax
under the Tax Act if the Rights are exercised or otherwise disposed of.
This statement is of a general nature only and is not intended to
constitute nor should it be construed to constitute legal or tax advice to any
particular shareholder. Shareholders are advised to consult their own tax
advisers regarding the consequences of acquiring, holding, exercising or
otherwise disposing of their Rights, taking into account their own particular
circumstances and any applicable tax laws.
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
As the possibility of the rights becoming exercisable is both remote
and speculative, the adoption of the Amended Plan will not constitute a
distribution of stock or property by the Corporation to its shareholders, an
exchange of property or stock, or any other event giving rise to the realization
of gross income by any shareholder. The holder of Rights may have taxable income
if the Rights become exercisable or are exercised or sold. In the event the
Rights should become exercisable, shareholders should consult their own tax
advisors concerning the consequences of acquiring, holding, exercising or
disposing of their Rights.
ELIGIBILITY FOR INVESTMENT IN CANADA
The issuance of the Rights will not affect the eligibility of the
Common Shares as investments for investors governed by certain Canadian federal
and provincial legislation governing insurance companies, trust companies, loan
companies and pension plans.
RECOMMENDATION OF THE BOARD OF DIRECTORS
The Board of Directors has determined that it continues to be advisable
and in the best interests of the Corporation and its shareholders that the
Corporation have in place a shareholder protection rights plan in the form of
the Amended Plan. Accordingly, the Board of Directors unanimously recommends
that the shareholders vote in favour of the reconfirmation and approval of the
Amended Plan. The Corporation has been advised that the Directors and senior
Officers of the Corporation intend to vote all Common Shares held by them in
favour of the confirmation and approval of the Amended Plan.
APPROVAL
At the Meeting, the Corporation's Independent Shareholders will be
asked to consider and, if thought advisable, to pass a resolution in the form
set forth in Schedule B to approve the continuation of the Corporation's
shareholder protection rights plan and its amendment and restatement in the form
of the Amended Plan. IN THE ABSENCE OF A CONTRARY INSTRUCTION, THE PERSONS
DESIGNATED BY MANAGEMENT OF THE CORPORATION IN THE ENCLOSED FORM OF PROXY INTEND
TO VOTE FOR THE FOREGOING RESOLUTION.
Shareholder approval and reconfirmation of the Amended Plan is not
required by law but is required by the terms of the Original Plan and applicable
stock exchange rules. The foregoing resolution must be approved by a majority of
the votes cast by the Independent Shareholders present or represented by proxy
at the Meeting. If the resolution is passed at the Meeting, then the Corporation
and the Rights Agent will execute the Amended Plan effective as of the date the
resolution is passed. If the resolution is not passed at the Meeting, the
Original Plan will become void and of no further force and effect, the Amended
Plan will not be executed and will never become effective and the Corporation
will no longer have any form of shareholder rights plan.
5. APPROVAL OF NAME CHANGE TO "GEAC INC."
Management recommends that the name of the Corporation be changed to
"Geac Inc.". Management believes that the new name will better reflect the
Corporation's business as a global enterprise software company.
IN THE ABSENCE OF A CONTRARY INSTRUCTION, THE PERSONS DESIGNATED BY
MANAGEMENT OF THE CORPORATION IN THE ENCLOSED FORM OF PROXY INTEND TO VOTE FOR
THE RESOLUTION AUTHORIZING THE CORPORATION TO AMEND ITS ARTICLES TO CHANGE THE
NAME OF THE CORPORATION TO "GEAC INC."
The foregoing special resolution must be approved by a majority of not
less than two-thirds of the votes cast by the holders of the Common Shares
present or represented by proxy at the Meeting. The Board of Directors reserves
the right not to proceed with the change of name at any time prior to the
endorsement of the certificate on the Articles of Amendment effecting same, if
the Board of Directors determines that it would be in the best interests of the
Corporation.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets out information concerning the compensation
earned from the Corporation and any of the Corporation's subsidiaries for the
fiscal years ended April 30, 2003, 2002 and 2001 by the Corporation's Chief
Executive Officer and the Corporation's other four most highly compensated
executive Officers for the fiscal year ended April 30, 2003 (collectively, the
"Named Executive Officers").
Excluded from reference are perquisites and other personal benefits
which do not exceed the lesser of $50,000 or 10% of the total of the annual
salary and bonus for any of the Named Executive Officers. All currency
references in this Circular are in Canadian dollars unless otherwise indicated.
Where compensation was paid other than in Canadian dollars during a fiscal year,
the amount has been converted to Canadian dollars at the average exchange rate
prevalent during that fiscal year.
ANNUAL COMPENSATION
OTHER ANNUAL SECURITIES UNDER ALL OTHER
FISCAL SALARY BONUS COMPENSATION OPTIONS GRANTED COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) (#) ($)
Paul D. Birch(1) 2003 538,615 384,725 nil nil nil
Former President and Chief 2002 413,980 320,031 nil 1,000,000 nil
Executive Officer 2001 nil nil nil nil nil
Arthur Gitajn 2003 301,755 154,875 65,575(2) nil nil
Chief Financial Officer 2002 262,226 259,356 nil 100,000 nil
2001 196,482 nil nil 35,000 nil
Bertrand Sciard 2003 433,843 352,728 72,699(3) nil nil
Managing Director, Geac 2002 397,145 1,277,502 nil 125,000 nil
Enterprise Solutions, Europe 2001 369,957 nil nil 135,000 29,368(4)
John L. Sherry, III 2003 338,558 157,353 nil nil nil
Senior Vice President, 2002 64,107 29,391 nil 150,000 nil
Marketing & Strategic Alliances 2001 nil nil nil nil nil
James M. Travers 2003 312,786 515,530 nil 600,000 nil
Senior Vice President; 2002 nil nil nil nil nil
President, Geac Americas 2001 nil nil nil nil nil
NOTES:
(1) On July 18, 2003, Mr. Birch resigned as an Officer and Director of the
Corporation and its subsidiaries. Mr. Birch joined the Corporation on
September 12, 2000 as a member of the Board of Directors. On May 30,
2001, Mr. Birch was appointed Chief Operating Officer and Chief
Financial Officer. On December 5, 2001, Mr. Birch was appointed
President and Chief Executive Officer. The options set forth above do
not include 40,000 options granted to Mr. Birch on September 25, 2000,
in connection with his appointment as a Director of the Corporation and
prior to his appointment as an Officer of the Corporation.
(2) This amount represents gross-up payments to compensate for certain
taxes and payments for car allowance.
(3) This amount represents payments for car allowance and pension payments.
(4) This amount represents payments for accrued vacation.
Charles S. Jones became the President and Chief Executive Officer of
the Corporation in July 2003. From December 2001 through July 2003 he served as
the Executive Chairman of the Board. For the year ended April 30, 2002, he was
paid a salary and other compensation of $335,981, as well as a bonus of $577,088
that was granted by the Board in January 2003. Mr. Jones was also in that fiscal
year granted options to acquire 600,000 Common Shares at an exercise price of
$6.37 per share. These options vested on December 4, 2002 and expire on December
4, 2011. In the year ended April 30, 2003, Mr. Jones received a salary of
$423,198. He has not yet been granted a bonus for the year ended April 30, 2003.
OPTIONS OF NAMED EXECUTIVE OFFICERS
OPTION GRANTS DURING THE FISCAL YEAR ENDED APRIL 30, 2003
The following table sets forth options to purchase or acquire Common
Shares granted during the fiscal year ended April 30, 2003 to each of the Named
Executive Officers.
MARKET VALUE OF
% OF TOTAL OPTIONS SECURITIES UNDERLYING
SECURITIES UNDER GRANTED TO EXERCISE OR OPTIONS ON THE DATE OF
OPTIONS GRANTED EMPLOYEES IN FISCAL BASE PRICE GRANT
NAME (#) YEAR ($/SHARE)(1) ($/SHARE) EXPIRATION DATE
Paul D. Birch nil nil N/A N/A N/A
Arthur Gitajn nil nil N/A N/A N/A
Bertrand Sciard nil nil N/A N/A N/A
John L. Sherry, III nil nil N/A N/A N/A
James M. Travers 600,000 26.9% 4.36 4.03 June 20, 2012
NOTE:
(1) In accordance with the Corporation's stock option plan, the exercise
price is calculated as not less than the arithmetic average of the high
and low board lot prices of the Common Shares on the TSX on the five
trading days immediately preceding the date of grant.
AGGREGATED OPTION EXERCISES DURING THE MOST RECENTLY COMPLETED
FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES
The following table sets out information concerning the exercise of
options by the Named Executive Officers during the year ended April 30, 2003 and
the value of unexercised options held by the Named Executive Officers as at
April 30, 2003.
UNEXERCISED OPTIONS AT APRIL 30, VALUE OF UNEXERCISED
SECURITIES AGGREGATE 2003(1) IN-THE-MONEY OPTIONS AT APRIL 30,
ACQUIRED ON VALUE 2003(2)
EXERCISE REALIZED (#) (#) ($) ($)
NAME (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
Paul D. Birch nil N/A 280,000 760,000 662,500 1,987,500
Arthur Gitajn nil N/A 62,500 92,500 38,500 38,500
Bertrand Sciard nil N/A 233,750 161,250 nil nil
John L. Sherry, III nil N/A 37,500 112,500 26,250 78,750
James M. Travers nil N/A nil 600,000 N/A 654,000
NOTES:
(1) The following table sets out the exercise price of the exercisable and
unexercisable options held by each of the Named Executive Officers as
at April 30, 2003:
EXERCISABLE OPTIONS AT APRIL 30, UNEXERCISABLE OPTIONS AT APRIL
2003 30, 2003
NAME NUMBER EXERCISE PRICE NUMBER EXERCISE PRICE
Paul D. Birch 30,000 $ 9.32 10,000 $ 9.32
250,000 $ 2.80 750,000 $ 2.80
Arthur Gitajn 17,500 $ 3.25 17,500 $ 3.25
20,000 $ 40.00 nil N/A
25,000 $ 7.50 75,000 $ 7.50
Bertrand Sciard 90,000 $ 32.92 30,000 $ 32.92
101,250 $ 8.61 33,750 $ 8.61
11,250 $ 28.58 3,750 $ 28.58
31,250 $ 7.50 93,750 $ 7.50
John L. Sherry, III 37,500 $ 4.75 112,500 $ 4.75
James M. Travers nil N/A 600,000 $ 4.36
(2) The value of the unexercised options is based on the difference between
the exercise price and the closing price of the Common Shares on the
TSX on April 30, 2003 of $5.45.
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS
Mr. Craig C. Thorburn, the Corporation's Senior Vice President, Mergers
& Acquisitions, and Corporate Secretary, is a partner of Blake, Cassels &
Graydon LLP, a law firm which provides legal services to the Corporation at the
firm's customary rates. The Corporation paid Blake, Cassels & Graydon LLP a
total of $24,328 in fiscal 2001, $1,686,458 in fiscal 2002 and $2,070,000 in
fiscal 2003 for legal services.
EMPLOYMENT CONTRACTS
PAUL D. BIRCH
The Corporation entered into employment agreements with Paul Birch as
Chief Operating Officer and as President of Geac Enterprise Solutions, Inc.
These agreements were not changed when Mr. Birch was appointed President and
Chief Executive Officer of the Corporation other than to increase his aggregate
salary from US$300,000 to US$350,000 per annum. The agreement with Mr. Birch as
the Corporation's Chief Operating Officer provided for a salary of US$50,000
with a target bonus of US$25,000, subject to the Corporation achieving a
specified EBITDA threshold. The agreement with Mr. Birch as President of Geac
Enterprise Solutions, Inc. provided for a salary of US$300,000 and a target
bonus of up to US$225,000, subject to the Corporation achieving a specified
EBITDA threshold. Mr. Birch was also entitled to receive certain grossed-up
payments to compensate him in respect of certain taxes.
In the event that Mr. Birch's employment with Geac Enterprise
Solutions, Inc. or with the Corporation was terminated without cause, he was
entitled to receive a lump sum termination payment in an amount equal to his
base salary received or receivable in respect of the immediately preceding year,
plus either the average of the bonuses paid or payable to him with respect to
each of the three preceding years or, if he had been employed for fewer than
three years, the average of the bonuses paid during those years. In the event of
a change in control and a change affecting employment within twelve months of a
change in control, Mr. Birch was permitted to resign and was then entitled to
severance equal to the termination payment. In each such case, Mr. Birch was
also entitled to benefit continuation for twelve months. On August 6, 2002, Mr.
Birch ceased to be president of Geac Enterprise Solutions, Inc., when James M.
Travers was appointed to that position. This change in his responsibilities did
not result in the payment of any severance benefits under the foregoing
agreements.
On July 18, 2003, Mr. Birch resigned as an Officer and Director of the
Corporation and its subsidiaries.
ARTHUR GITAJN
The Corporation has entered into an employment agreement with Arthur
Gitajn confirming the terms of his continued employment as Chief Financial
Officer of the Corporation and setting forth his remuneration, including salary,
annual performance bonus, stock options, benefits, vacation entitlement and car
allowance. The agreement with Mr. Gitajn provides for an annual base salary of
US$100,000 plus C$150,000, subject to annual review, plus a performance-based
bonus which establishes a target base bonus of C$150,000 for fiscal year 2003.
Mr. Gitajn is also entitled to receive certain payments as compensation for
additional taxes he is obliged to pay as a resident of the Province of Ontario
compared to the taxes that he would have paid as a resident of the State of
Maryland.
The current agreement with Mr. Gitajn has a term that will expire on
April 30, 2004, unless mutually extended by the parties, and any expiration of
the agreement is considered "termination for any reason other than cause." In
the event that Mr. Gitajn's employment is terminated at any time for any reason
other than cause, he will be entitled to receive a lump sum cash payment (the
"Gitajn Termination Payment") in the amount equal to 150% of the sum of: (a) at
his option, (i) his base salary received or receivable by him in respect of the
immediately preceding twelve months in the normal payroll cycle or (ii) his base
salary for the calendar month preceding the date of termination multiplied by
12; (b) his annual car allowance; and (c) the annual bonus paid to him in fiscal
year 2002. Additionally, Mr. Gitajn will be entitled to payment for unused
accrued vacation and certain expenses for eighteen months together with
US$75,000 for relocation expenses. In the event of a change in control and a
change affecting Mr. Gitajn's employment within twelve months of a
change in control, Mr. Gitajn may elect to resign from the Corporation and will
be entitled to the Gitajn Termination Payment. In each such case, Mr. Gitajn
will also be entitled to benefit continuation for eighteen months.
BERTRAND SCIARD
The Corporation has entered into an employment agreement with Bertrand
Sciard setting forth his remuneration, including salary, annual performance
bonus, stock options, benefits, vacation entitlement and car allowance. The
agreement with Mr. Sciard provides for an annual salary of 1,520,000 French
francs as well as an annual performance-based bonus of 1,000,000 French francs,
subject to annual review.
If Mr. Sciard's employment is terminated by the Corporation without
cause, or in the event of a change in control and a change affecting employment,
Mr. Sciard is entitled to a payment equal to eighteen months of his salary plus
an amount equivalent to the bonus received in the previous year.
JOHN L. SHERRY, III
The Corporation has entered into an employment agreement with John
Sherry as Senior Vice President, Marketing & Strategic Alliances setting forth
his remuneration, including salary, annual performance bonus, stock options,
benefits and vacation entitlement. The agreement with Mr. Sherry provides for an
annual salary of US$220,000, subject to annual review. Mr. Sherry is also
eligible to participate in the Corporation's bonus plan, with a bonus target
amount of US$100,000 in fiscal year 2003.
If Mr. Sherry's employment is terminated by the Corporation for any
reason other than cause, Mr. Sherry is entitled to receive severance in
accordance with the Corporation's then-current policy, subject to a minimum of
six month's salary and benefit continuation. In the event of a change in control
and a change affecting his employment within twelve months of a change in
control, Mr. Sherry may elect to resign from the Corporation and will be
entitled to payment of salary and benefits for a period of twelve months.
JAMES M. TRAVERS
James Travers has entered into an agreement as President of Geac
Americas, Geac Enterprise Solutions, Inc., setting forth his remuneration,
including salary, annual performance bonus, stock options, vacation entitlement
and car allowance. The agreement with Mr. Travers provides for an annual base
salary of US$275,000, subject to annual review, together with an annual bonus of
US$250,000 commencing with the fiscal year ending April 30, 2003, subject to
achieving certain performance goals.
In the event that Mr. Travers' employment is terminated at any time for
any reason other than cause, he will be entitled to receive a lump sum cash
payment (the "Travers Termination Payment") in an amount equal to, at his
option, (i) his base salary received or receivable by him in respect of the
immediately preceding twelve months in the normal payroll cycle or (ii) his base
salary for the calendar month preceding the date of termination multiplied by
twelve. In the event of a change in control and a change affecting Mr. Travers'
employment within twelve months of a change in control, Mr. Travers may elect to
resign from the Corporation and will be entitled to the Travers Termination
Payment. In each such case, Mr. Travers will also be entitled to benefit
continuation for twelve months.
REPORT ON EXECUTIVE COMPENSATION
The Corporation's executive compensation program is administered by the
Human Resources and Compensation Committee, which comprises three (3) Directors
who are neither present nor former Officers of the Corporation. The Human
Resources and Compensation Committee has, as part of its mandate, primary
responsibility for making recommendations for approval by the Board of Directors
with respect to the remuneration of executive Officers of the Corporation. The
Human Resources and Compensation Committee also evaluates the performance of the
Corporation's executive Officers, administers the Corporation's
performance-based incentive compensation plans and participates in
recommendations to the Board on stock options granted under the Corporation's
stock option plans. The guiding philosophy of the Committee in the determination
of executive compensation is pay-for-performance and the need to provide a total
compensation package that will attract and retain qualified and experienced
executives.
The Corporation's compensation policy is structured to support the
business strategy and the organizational bottom-line culture of the Corporation,
and to reflect the compensation policies of the industry in which the
Corporation competes. Under the Corporation's compensation policy, each
executive Officer's main compensation is typically comprised of a salary, a
performance-based incentive payment and stock options. The Corporation has
retained compensation consultants to ensure that the Corporation has in place
stock option plans that are in accordance with industry standards.
Salaries for executive Officers are reviewed annually and are based on
individual performance, responsibility and experience to ensure that they
reflect the proven or expected contribution of each executive Officer. Salaries
are believed to be market-competitive based on the size of the Corporation, the
geographic location of the executive offices and as compared to companies in
related industries.
Performance-based incentive payments and stock option incentives have
two main purposes. From the shareholders' perspective, performance-based
incentive payments and stock option incentives are an opportunity to influence
the calibre of talent that will be attracted to the Corporation and to focus the
executive Officers' attention on the success factors of the business that
ultimately determine the value of the Corporation. From the executive Officers'
perspective, the incentives are an opportunity to receive above-average rewards
for above-average performance and to build personal capital in an investment
that he or she can influence.
The Corporation's performance-based incentive payments are generally
determined depending upon the revenues and profits of the Corporation or, for
Officers of the Corporation's operating subsidiaries, on the revenues and
profits of the profit centre, division or region for which they are responsible,
and on the participant's personal performance, including with respect to expense
reduction. The performance-based incentive, which includes a minimum performance
threshold and an upper payout limit, is reviewed and set annually. In varying
degrees this system is applied throughout the Corporation. Under the incentive
compensation scheme, approximately 80% of the incentive compensation is fixed
against established performance criteria (based on revenues and profits), while
approximately 20% is based on managerial performance and the achievement of each
individual's pre-determined strategic initiatives.
The goal for the bonus plan for the fiscal year ended April 30, 2003
was to provide an incentive to senior management to achieve significant EBIT
from their operating businesses. At 90% of targeted levels 50% of the on-target
bonus was paid, below 90% no bonus was paid and performance in excess of
targeted levels was rewarded with an escalating percentage of on-target bonus
depending on the level of over-achievement.
To link further the interests of the option holders with those of the
shareholders, stock options are granted at 100% of market value to a significant
number of Officers and senior managers and a limited number of other employees.
The value of the options is highly dependent on the success of the Corporation
as reflected in the Common Share price and the options directly compensate the
holder for the return provided to shareholders over a longer period. Most of the
stock options issued to date generally become exercisable over three or four
years from the date of the grant and generally expire ten years after they are
granted.
The Corporation periodically reviews its executive compensation program
to ensure that it continues to meet the Corporation's objectives.
Report presented by the Human Resources and Compensation Committee:
Pierre MacDonald (Committee Chairman)
C. Kent Jespersen
Michael D. Marvin
COMPENSATION OF DIRECTORS
During the fiscal year ended April 30, 2003, each Director who is not a
salaried employee of the Corporation or any of its subsidiaries (an "Outside
Director") received an annual retainer of US$20,000 for his services as a
Director. The Chairmen of the Audit Committee, the Human Resources and
Compensation Committee and the Corporate Governance Committee each receive an
additional retainer of US$5,000 per annum. In addition to the annual retainer,
each Outside Director receives US$1,000 for each meeting attended in person and
an additional US$1,000 fee per trip if such meeting requires travel "out of
town". Each Outside Director receives US$1,000 for each meeting in which he
participates via telephone of more than 15 minutes in duration and US$500 for
each telephone meeting of less than 15 minutes in duration. The Corporation
reimburses the out-of-pocket expenses incurred by each Director for every
meeting attended.
If an Outside Director, at the request of management or of the Board,
attends a meeting (other than a Board meeting or a committee meeting) or
performs services related to Directors' responsibilities for the overall
stewardship of the Corporation, he will be compensated based on the same rates
for attending Board or committee meetings as set out above. If an Outside
Director is requested to perform other consulting and professional services,
fees for such services shall be paid at a rate mutually agreed to by the
Director and the Chairman provided that such fees shall not exceed US$50,000 in
any fiscal year unless agreed to by the Board of Directors. Outside Directors
are also eligible to participate in the Corporation's stock option plan. No
stock options were granted to Outside Directors during the fiscal year ended
April 30, 2003.
Directors who are also Officers or employees of the Corporation were
not paid any amount in respect of their services as Directors of the
Corporation.
DIRECTORS' AND OFFICERS' INSURANCE
The Corporation has purchased and maintains insurance for the benefit
of the Directors and Officers of the Corporation and its subsidiaries. Such
policy insures Directors, Officers and the Corporation (in circumstances where
the Corporation indemnifies its Directors and Officers against certain
liabilities incurred by Directors or Officers in their capacity as such).
Directors and Officers are indemnified by the Corporation except where such
liability relates to the failure by a Director or Officer to act honestly, in
good faith and with a view to the best interests of the Corporation.
During the annual period ending August 31, 2003, the Corporation paid
an aggregate premium of US$463,000 for Directors' and Officers' liability
insurance. No part of this premium was paid by the Directors or Officers of the
Corporation. The aggregate amount of insurance purchased was US$60 million,
including defence costs, of which not more than US$50 million may be applied for
the benefit of the Corporation. With respect to the Corporation, coverage is
subject to a deductible of US$500,000 for each loss with respect to securities
claims and US$250,000 for each loss in respect of all other claims for which the
Corporation grants indemnification as permitted or required by law. No
deductible is payable by any Director or Officer making a claim under the
policy.
STATEMENT OF CORPORATE GOVERNANCE PRACTICES
The Directors and management of the Corporation strongly believe that
good corporate governance is vital to the effective and efficient operation of
the Corporation. Good corporate governance demonstrates the Board's ability to
direct independently and evaluate the performance of the Corporation's
management as well as that of the Board members themselves. The TSX requires
that each listed company disclose, on an annual basis, its approach to corporate
governance with reference to guidelines for effective corporate governance
published by the TSX (the "TSX Guidelines"). Such disclosure is attached to this
Circular as Appendix B.
PERFORMANCE GRAPH
The following graph and table compare the total cumulative return for
$100 invested in the Common Shares with the cumulative total return for $100
invested in the S&P/TSX Composite Index (formerly known as the TSE 300) for the
five-year period ending April 30, 2003. Dividends declared are assumed to be
reinvested.
The Common Share performance set out in the graph does not necessarily indicate
future price performance.
FIVE YEAR CUMULATIVE TOTAL RETURN ON $100 INVESTMENT
IN THE COMMON SHARES OF THE CORPORATION
[GRAPHIC]
AT APRIL 30 1998 1999 2000 2001 2002 2003
Common Shares(1) $100.00 $50.40 $ 37.71 $ 3.19 $ 7.54 $ 9.67
S&P/TSX Composite Index $100.00 $93.04 $125.73 $108.20 $106.06 $92.97
NOTE:
(1) The Corporation has not paid any dividends on its Common Shares at any
time during the five fiscal years ended April 30, 2003.
SHAREHOLDER PROPOSALS
Persons entitled to vote at the next annual meeting of the Corporation
who wish to submit a proposal for consideration at the meeting must submit their
proposal to the Corporation by May 3, 2004.
DIRECTORS' APPROVAL
The contents and the sending of this Circular have been approved by the
Board of Directors of the Corporation.
DATED as of the 1st day of August, 2003.
[GRAPHIC]
Craig C. Thorburn
Corporate Secretary
SCHEDULE A
RESOLUTION OF THE SHAREHOLDERS
OF GEAC COMPUTER CORPORATION LIMITED
(THE "CORPORATION")
APPROVAL OF NEW 2003 EMPLOYEE STOCK PURCHASE PLAN
BE IT RESOLVED AS AN ORDINARY RESOLUTION THAT:
1. Subject to the approval of the Toronto Stock Exchange, the
Corporation's new 2003 Employee Stock Purchase Plan (the "New ESPP"),
as summarized in the attached Management Proxy Circular, be and the
same is hereby approved.
2. Notwithstanding the approval of the New ESPP by the shareholders of the
Corporation, the Board of Directors of the Corporation be and is hereby
authorized at any time to terminate or refrain from implementing the
New ESPP if the directors determine such action to be in the best
interests of the Corporation.
3. Any director or officer of the Corporation be and is hereby authorized
to do all such things and execute all such documents and instruments as
may be necessary or desirable to give effect to these resolutions.
SCHEDULE B
RESOLUTION OF THE SHAREHOLDERS
OF GEAC COMPUTER CORPORATION LIMITED
(THE "CORPORATION")
APPROVAL OF THE RECONFIRMATION AND AMENDMENT OF
THE SHAREHOLDER PROTECTION RIGHTS PLAN
BE IT RESOLVED AS AN ORDINARY RESOLUTION THAT:
1. The shareholder protection rights plan of the Corporation be continued
and the Amended and Restated Shareholder Protection Rights Agreement to
be made as of September 10, 2003 between the Corporation and
Computershare Trust Company of Canada (the "Rights Agent"), which
amends and restates the Shareholder Protection Rights Agreement dated
as of March 15, 2000 between the Corporation and the Rights Agent (the
"Original Plan") and continues the rights issued under the Original
Plan, be and it is hereby ratified, confirmed and approved.
2. Any director or officer of the Corporation be and is hereby authorized
to do all such things and execute all such documents and instruments as
may be necessary or desirable to give effect to these resolutions.
SCHEDULE C
SPECIAL RESOLUTION OF THE SHAREHOLDERS
OF GEAC COMPUTER CORPORATION LIMITED
(THE "CORPORATION")
AMENDMENT TO THE ARTICLES OF THE CORPORATION TO
CHANGE THE NAME OF THE CORPORATION TO "GEAC INC."
BE IT RESOLVED AS A SPECIAL RESOLUTION THAT:
1. The Corporation amend its articles to change the name of the
Corporation to "Geac Inc.".
2. Notwithstanding the approval of the change of the name of the
Corporation by the shareholders of the Corporation, the Board of
Directors of the Corporation be and is hereby authorized to withdraw
any documentation implementing such change of name at any time prior to
the endorsement of the certificate on the Articles of Amendment if the
directors determine such action to be in the best interests of the
Corporation.
3. Any director or officer of the Corporation be and is hereby authorized
to do all such things and execute all such documents and instruments as
may be necessary or desirable to give effect to these resolutions.
APPENDIX A
AMENDED AND RESTATED
SHAREHOLDER PROTECTION RIGHTS PLAN SUMMARY
The following is a summary of the material terms and conditions of the
Amended Plan. This summary is qualified by and is subject to the full terms and
conditions of the Amended Plan (copies of which are available from the Corporate
Secretary of the Corporation or on the Corporation's website, as described in
the Circular).
ISSUANCE OF RIGHTS
One Right (a "Right") was issued for each Common Share outstanding at
the Record Time of 5:00 p.m. (Toronto time) on March 15, 2000, the date of
implementation of the Original Plan, and one Right was also issued for each
Voting Share (which includes the Common Shares and any other shares in or
interests of the Corporation entitled to vote generally in the election of
directors) issued thereafter prior to the Separation Time (as defined below),
subject to the earlier termination or expiration of the Rights as set out in the
Amended Plan. Under the Amended Plan, the Rights are simply reconfirmed and the
Corporation reconfirms its authorization to continue the issuance of one new
Right for each Common Share issued.
EXERCISE PRICE
Until the Separation Time, the exercise price ("Exercise Price") of
each Right is three times the market price, from time to time, of the Common
Shares. From and after the Separation Time, the Exercise Price is three times
the market price, as at the Separation Time, per Common Share. The Exercise
Price is subject to adjustment as set out in the Amended Plan.
TERM
If the Amended Plan is confirmed by the shareholders at the Meeting, it
will become effective immediately following such approval and remain in force
until the earlier of the Termination Time (the time at which the right to
exercise the Rights shall expire pursuant to the Amended Plan) and the
termination of the annual meeting of the shareholders in the year 2006, unless
prior to such meeting the Independent Shareholders ratify the continued
existence of the Amended Plan, in which case the Amended Plan would expire at
the earlier of the Termination Time and the termination of the annual meeting in
2009.
TRADING OF RIGHTS
Until the Separation Time, the Rights will be evidenced by the
certificates representing the associated Common Shares and will be transferable
only together with the associated Common Shares. After the Separation Time,
separate certificates evidencing the Rights will be mailed to holders of record
of Voting Shares (other than any shareholder or group of shareholders making a
take-over bid) as of the Separation Time and such separate Rights certificates
alone will evidence the Rights. The Rights will be listed on The Toronto Stock
Exchange (the "TSX"), subject to the Corporation complying with the requirements
of the TSX.
SEPARATION TIME
The Rights are not exercisable and do not trade separately from their
associated Voting Shares until the "Separation Time." The "Separation Time" is
the close of business on the tenth trading day after the earlier of (i) the
Stock Acquisition Date, which is the first date of public announcement of facts
indicating that a person has become an Acquiring Person (as defined below) and
(ii) the date of the commencement of, or first public announcement of the intent
of any person (other than the Corporation or any subsidiary of the Corporation)
to commence, a take-over bid (other than a Permitted Bid or a Competing
Permitted Bid, each as defined below). The Separation Time can also be such
later date as may from time to time be determined by the Board of Directors.
ACQUIRING PERSON
An "Acquiring Person" is a person who is the Beneficial Owner (as
defined below) of 20% or more of the outstanding Voting Shares. Excluded from
the definition of Acquiring Person are the Corporation and its subsidiaries and
any person who becomes the Beneficial Owner of 20% or more of the outstanding
Voting Shares as a result of one or any combination of a Voting Share Reduction,
a Pro Rata Acquisition, a Permitted Bid Acquisition, an Exempt Acquisition or a
Convertible Security Acquisition. In general:
(i) a "Voting Share Reduction" means an acquisition or redemption
by the Corporation of Voting Shares which, by reducing the
number of Voting Shares outstanding, increases the percentage
of Voting Shares beneficially owned by such person to 20% or
more of the Voting Shares then outstanding;
(ii) a "Pro Rata Acquisition" means an acquisition of Voting Shares
and/or Convertible Securities as a result of a stock dividend,
a stock split, a dividend reinvestment plan, or a rights
offering issued on the same pro rata basis to all the holders
of a series or class of Voting Shares;
(iii) a "Permitted Bid Acquisition" means an acquisition of Voting
Shares made pursuant to a Permitted Bid or a Competing
Permitted Bid;
(iv) an "Exempt Acquisition" means an acquisition of Voting Shares
and/or Convertible Securities in respect of which the Board of
Directors has waived the application of the Amended Plan or
which was made pursuant to a distribution to the public of
Voting Shares and/or Convertible Securities made pursuant to a
prospectus or a securities exchange take-over bid circular or
a distribution by way of a private placement by the
Corporation; and
(v) a "Convertible Security Acquisition" means an acquisition of
Voting Shares upon the exercise of Convertible Securities
received by such Person pursuant to a Permitted Bid
Acquisition, an Exempt Acquisition or a Pro Rata Acquisition.
Also excluded from the definition of Acquiring Person are underwriters
or banking group or selling group members acting in connection with a
distribution of securities and any "Grandfathered Person" (generally, any person
who is the Beneficial Owner of 20% or more of the outstanding Voting Shares at
the date of the Amended Plan). To the Corporation's knowledge, there are no
Grandfathered Persons.
BENEFICIAL OWNERSHIP
In general, a person is deemed to "Beneficially Own" securities
actually held by others in circumstances where those holdings are or should be
grouped together for purposes of the Amended Plan. Included are holdings by the
person's "Affiliates" (generally, a person that controls, is controlled by, or
under common control with another person) and "Associates" (generally, relatives
sharing the same residence). Also included are securities that the person or any
of the person's Affiliates or Associates has the right to acquire within 60 days
(other than customary agreements with and between underwriters and banking group
or selling group members with respect to a distribution of securities and other
than pursuant to pledges of securities in the ordinary course of business). A
person is also deemed to Beneficially Own any securities that are Beneficially
Owned (as described above) by any other person with whom the person is acting
jointly or in concert. A person is acting jointly or in concert with any other
person who is a party to an agreement, commitment or understanding with the
first person for the purpose of acquiring or offering to acquire Voting Shares.
EXCLUSIONS FROM THE DEFINITION OF BENEFICIAL OWNERSHIP
The definition of "Beneficial Ownership" contains several exclusions
whereby a person is not considered to Beneficially Own a security. There are
exemptions from the deemed Beneficial Ownership provisions for institutional
shareholders acting in the ordinary course of business. These exemptions apply
to (i) an investment or mutual fund manager ("Manager") which holds securities
in the ordinary course of business in the performance of its duties for the
account of any other person, including non-discretionary
accounts held on behalf of a client by a broker dealer or dealer registered
under applicable law (a "Client"); (ii) a licensed trust company ("Trust
Company") acting as trustee or administrator or in a similar capacity in
relation to the estates of deceased or incompetent persons (each an "Estate
Account") or in relation to other accounts (each an "Other Account") and which
holds such security in the ordinary course of its duties for such accounts;
(iii) a Crown agent or agency (a "Crown Agent"), (iv) a person established by
statute (a "Statutory Body"), the ordinary business or activity of which
includes the management of investment funds for employee benefit plans, pension
plans and insurance plans of various public bodies, and (v) the administrator
("Administrator") of one or more pension funds or plans (a "Plan") registered
under applicable law. The foregoing exemptions apply only so long as the
Manager, Trust Company, Crown Agent, Statutory Body, Administrator or the Plan
is not then making or has not then announced an intention to make a take-over
bid, other than an offer to acquire Common Shares or other securities pursuant
to a distribution by the Corporation or by means of ordinary market
transactions. Also, a person will not be deemed to "Beneficially Own" a security
because such person (i) is a Client of the same Manager, has an Estate Account
or an Other Account with the same Trust Company, or is a Plan with the same
Administrator as another person or Plan on whose account the Manager, Trust
Company or Administrator, as the case may be, holds such security; or (ii) is a
Client of a Manager, Estate Account, Other Account or Plan, and the security is
owned at law or in equity by the Manager, Trust Company or Administrator, as the
case may be. A person will not be deemed to "Beneficially Own" any securities
that are the subject of a Permitted Lock-up Agreement. A "Permitted Lock-Up
Agreement" is an agreement between a person and one or more holders of Voting
Shares and/or Convertible Securities (each a "Locked-up Person") (the terms of
which are publicly disclosed and reduced to writing and a copy of which is made
available to the public (including the Corporation) not later than the date the
Lock-up Bid (as defined below) is publicly announced or, if the Lock-up Bid has
been made prior to the date on which such agreement is entered into, forthwith,
and in any event not later than the business day following the date of such
agreement), pursuant to which each such Locked-up Person agrees to deposit or
tender Voting Shares and/or Convertible Securities to a take-over bid (the
"Lock-up Bid") made or to be made by the person or any of such person's
Affiliates or Associates or any other person referred to in the definition of
Beneficial Owner, provided that:
(i) the agreement permits any Locked-up Person to terminate its
obligation to deposit or tender to or not to withdraw Voting
Shares and/or Convertible Securities (or both) from the
Lock-up Bid in order to tender or deposit such securities to
another take-over bid or support another transaction:
(A) where the price or value per Voting Share or
Convertible Security offered under such other
take-over bid or transaction is higher than the price
or value per Voting Share or Convertible Security
offered under the Lock-up Bid; or
(B) if (a) the price or value per Voting Share or
Convertible Security offered under the other
take-over bid or transaction exceeds by as much as or
more than a specified amount (the "Specified Amount")
the price or value per Voting Share or Convertible
Security offered under the Lock-up Bid, provided that
such Specified Amount is not greater than 7% of the
price or value per Voting Share or Convertible
Security offered under the Lock-up Bid; or (b) the
number of Voting Shares and/or Convertible Securities
to be purchased under the other take-over bid or
transaction exceeds by as much as or more than a
specified number (the "Specified Number") the number
of Voting Shares and/or Convertible Securities that
the Offeror has offered to purchase under the Lock-up
Bid at a price or value per Voting Share or
Convertible Security that is not less than the price
or value per Voting Share or Convertible Security
offered under the Lock-up Bid, provided that the
Specified Number is not greater than 7% of the number
of Voting Shares and/or Convertible Securities
offered under the Lockup Bid; and, for greater
clarity, the agreement may contain a right of first
refusal or require a period of delay to give such
person an opportunity to match a higher price in
another take-over bid or transaction or other similar
limitation on a Locked-up Person's right to withdraw
Voting Shares and/or Convertible Securities from the
agreement, so long as the limitation does not
preclude the exercise by the Locked-up Person of the
right to withdraw Voting Shares and/or Convertible
Securities during the period of the other take-over
bid or
transaction; and
(ii) no "break-up" fees, "top-up" fees, penalties, expenses or
other amounts that exceed in the aggregate the greater of:
(A) the cash equivalent of 2.5% of the price or value
payable under the Lock-up Bid to a Locked-up Person;
and
(B) 50% of the amount by which the price or value payable
under another take-over bid or transaction to a
Locked-up Person exceeds the price or value of the
consideration that such Locked-up Person would have
received under the Lock-up Bid, shall be payable by a
Locked-up Person pursuant to the agreement in the
event a Locked-up Person fails to deposit or tender
Voting Shares and/or Convertible Securities to the
Lock-up Bid, or withdraws Voting Shares and/or
Convertible Securities previously tendered thereto in
order to tender to another take-over bid or support
another transaction.
FLIP-IN EVENT
A "Flip-In Event" occurs when any person becomes an Acquiring Person.
If a Flip-In Event occurs prior to the Expiration Time that has not been waived
by the Board of Directors (see "Waiver," below), each Right (except for Rights
Beneficially Owned or which may thereafter be Beneficially Owned by an Acquiring
Person or a transferee of such a person, which Rights will become null and void)
shall constitute the right to purchase from the Corporation, on payment of the
Exercise Price, Common Shares having an aggregate market price equal to twice
the Exercise Price, for an amount in cash equal to the Exercise Price, subject
to anti-dilution adjustments.
PERMITTED BID AND COMPETING PERMITTED BID
A take-over bid will not trigger a Flip-In Event if it is a Permitted
Bid or Competing Permitted Bid. A "Permitted Bid" is a take-over bid made by way
of a take-over bid circular to all holders of Voting Shares and which complies
with the following additional provisions:
(i) no Voting Shares shall be taken up or paid for pursuant to the
take-over bid prior to the close of business on a date which
is not less than 60 days following the date of the take-over
bid;
(ii) unless the take-over bid is withdrawn, Voting Shares may be
deposited pursuant to the take-over bid at any time prior to
the close of business on the date of first take-up or payment
for Voting Shares and all Voting Shares deposited pursuant to
the take-over bid may be withdrawn at any time prior to the
close of business on such date;
(iii) more than 50% of the then outstanding Voting Shares held by
Independent Shareholders (as defined in the Amended Plan) must
be deposited to the take-over bid and not withdrawn at the
close of business on the date of first take-up or payment for
Voting Shares; and
(iv) in the event that more than 50% of the then outstanding Voting
Shares held by Independent Shareholders have been deposited to
the take-over bid and not withdrawn as at the date of first
takeup or payment for Voting Shares under the take-over bid,
the Offeror will make a public announcement of that fact and
the take-over bid will remain open for deposits and tenders of
Voting Shares for not less than 10 business days from the date
of such public announcement.
A Competing Permitted Bid is a take-over bid that is made after a
Permitted Bid has been made but prior to its expiry, and that satisfies all the
requirements of a Permitted Bid as described above, except that a Competing
Permitted Bid is only required to remain open until a date that is not less than
the later of 35 days after the date of the take-over bid constituting the
Competing Permitted Bid and 60 days after the date of the take-over bid of the
prior bid.
REDEMPTION
Redemption of Rights on Approval of Holders of Voting Shares and Rights. With
the prior consent of the holders of Voting Shares or Rights, the board of
directors may at any time prior to the occurrence of a Flip-In Event that has
not been waived, elect to redeem all but not less than all of the then
outstanding Rights at a redemption price of $0.001 per Right (the "Redemption
Price"), subject to adjustment for anti-dilution as provided in the Amended
Plan.
Deemed Redemption. If a person who has made a Permitted Bid, a Competing
Permitted Bid or an Exempt Acquisition in respect of which the Board of
Directors has waived or has deemed to have waived the application of the Amended
Plan consummates the acquisition of the Voting Shares, the Board of Directors
shall be deemed to have elected to redeem the Rights for the Redemption Price.
Redemption of Rights on Withdrawal or Termination of Bid. Where a take-over bid
that is not a Permitted Bid or Competing Permitted Bid expires, is withdrawn or
otherwise terminates after the Separation Time and prior to the occurrence of a
Flip-In Event, the Board of Directors may elect to redeem all the outstanding
Rights at the Redemption Price. Upon the Rights being so redeemed, all the
provisions of the Amended Plan shall continue to apply as if the Separation Time
had not occurred and Rights Certificates had not been mailed, and the Separation
Time shall be deemed not to have occurred.
WAIVER
Discretionary Waiver respecting Acquisition not by Take-over Bid Circular. With
the prior consent of the holders of Voting Shares the Board of Directors may,
prior to the occurrence of a Flip-In Event that would occur by reason of an
acquisition of Voting Shares otherwise than pursuant to a take-over bid made by
means of a take-over bid circular sent to all holders of Voting Shares or by
inadvertence when such inadvertent Acquiring Person has then reduced its
holdings to below 20%, waive the application of the Amended Plan to such Flip-In
Event.
Discretionary Waiver respecting Acquisition by Take-over Circular and Mandatory
Waiver of Concurrent Bids. The Board of Directors may, prior to the occurrence
of a Flip-In Event that would occur by reason of an acquisition of Voting Shares
pursuant to a take-over bid made by means of a take-over bid circular sent to
all holders of Voting Shares, waive the application of the Amended Plan to such
a Flip-In Event, provided that if the Board of Directors waives the application
of the Amended Plan to such a Flip-In Event, the Board of Directors shall be
deemed to have waived the application of the Amended Plan in respect of any
other Flip-In Event occurring by reason of such any take-over bid made by means
of a take-over bid circular sent to all holders of Voting Shares prior to the
expiry of the take-over bid for which a waiver is, or is deemed to have been,
granted.
Waiver of Inadvertent Acquisition. The Board of Directors may waive the
application of the Amended Plan in respect of the occurrence of any Flip-In
Event if (i) the Board of Directors has determined that a person became an
Acquiring Person under the Amended Plan by inadvertence and without any intent
or knowledge that it would become an Acquiring Person; and (ii) the Acquiring
Person has reduced its Beneficial Ownership of Voting Shares such that at the
time of waiver the person is no longer an Acquiring Person.
SUPPLEMENTS AND AMENDMENTS
The Corporation may make changes to the Amended Plan prior to or after
the Separation Time to correct any clerical or typographical error or to
maintain the validity of the Amended Plan as a result of any change in any
applicable legislation, rules or regulation without the approval of the holders
of the Voting Shares or Rights. The Corporation may also make changes to the
Amended Plan prior to the Meeting without the approval of the holders of the
Voting Shares or the Rights. The Corporation may, with the approval of the
holders of Voting Shares, at any time after the Meeting but prior to the
Separation Time, make changes to or rescind any of the provisions of the Amended
Plan and the Rights (whether or not such action would materially adversely
affect the interest of the holders of Rights generally). The Corporation may,
with the approval of the holders of Rights, at any time after the Separation
Time, make changes to or rescind any of the provisions of
the Amended Plan and the Rights (whether or not such action would materially
adversely affect the interest of the holders of Rights generally).
ANTI-DILUTION ADJUSTMENTS
The Exercise Price of a Right, the number and kind of shares subject to
purchase upon exercise of a Right, and the number of Rights outstanding, will be
adjusted in certain events, including:
(i) if there is a dividend payable in Common Shares or Convertible
Securities (other than pursuant to any optional stock dividend
program) on the Common Shares, or a subdivision or
consolidation of the Common Shares, or an issuance of Common
Shares or Convertible Securities in respect of, in lieu of or
in exchange for Common Shares; or
(ii) if the Corporation fixes a record date for the distribution to
all holders of Common Shares of certain rights or warrants to
acquire Common Shares or Convertible Securities, or for the
making of a distribution to all holders of Common Shares of
evidences of indebtedness or assets (other than regular
periodic cash dividends or stock dividends payable in Common
Shares) or rights or warrants.
APPENDIX B
STATEMENT OF CORPORATE GOVERNANCE PRACTICES
DOES THE
CORPORATION
TSX CORPORATE GOVERNANCE GUIDELINES ALIGN? CORPORATE GOVERNANCE PRACTICES
(1) The Board of Directors should Yes The Board of Directors is responsible for the stewardship of
explicitly assume responsibility for the business and affairs of the Corporation, and reviews,
stewardship of the corporation, and as discusses and approves various matters related to the
part of the overall stewardship Corporation's operations, strategic direction and
responsibility, should assume organizational structure to ensure that the best interests
responsibility for the following of the Corporation and its stakeholders are being served. In
matters: so doing, the Board of Directors oversees the conduct of the
business and supervises management, which is responsible
for the day-to-day operation of the business. The Board has
established a grant of authority that prescribes the limits
management's of authority beyond which Board approval must be
obtained. The Board of Directors meets at regular quarterly
intervals throughout the year. Additional meetings are held
depending upon opportunities or issues to be dealt with by
the Corporation from time to time. During the year ended
April 30, 2003, the Board of Directors held eighteen
meetings.
(a) adoption of a strategic Yes The President and Chief Executive Officer, with the active
planning process; involvement of the Board of Directors, is responsible for
ensuring that there are long-term goals and a strategic
planning process in place for the Corporation. The Board
of Directors has developed formal guidelines including the
requirement that the Board approves all acquisitions with a
purchase price in excess of $5 million. In addition,
the Board reviews, at each regular quarterly meeting, each
acquisition not requiring formal Board approval that has
transpired during the previous quarter or is under active
consideration. A budget for each fiscal year is reviewed
and approved by the Board. Updates on industry trends,
product strategies, new product developments, major new
business and specific problems or action plans are presented
by management and discussed as part of a management
report at each regular quarterly Board meeting. On an annual
basis, the Board of Directors and management meet together
for a strategic planning session, where the Board of Directors
reviews and approves a strategic plan. On an on-going basis,
the Board of Directors monitors management's success in
implementing the strategies set out in the plan and provides
guidance and judgment with respect to the evolving strategic
plan.
(b) the identification of the Yes The Board of Directors, through its Committees and as a
principal risks of the whole, has a mandate to ensure that there are in place
corporation's business and systems effectively to monitor and manage business risks,
ensuring the implementation of with a view to the long-term viability of the Corporation.
appropriate systems to manage By means of the strategic planning process, the internal
these risks; audit function and regular Board meetings, the Board
identifies and reviews with management the principal business
risks and receives a report of management's assessment of and
proposed responses to those risks as they develop to ensure
that all risks are being appropriately managed. The Audit
Committee oversees the implementation and monitoring of
systems put in place to deal with those risks.
(c) succession planning, including Yes The Board assists in identifying the skill sets necessary
appointing, training and for management personnel planning and succession. The
monitoring senior management; Chairman and the President and Chief Executive Officer
review management succession and development with the Board as
part of the annual compensation review. As appropriate, the
Board will provide recommendations to the Chairman and the
President and Chief Executive Officer on the addition of senior
Officers. While the responsibility for direct training has
traditionally been left to senior management, the Board
satisfies itself that the necessary levels of skill and
experience exist when reviewing and making appointments. There
is regular discussion between the Board, the Human Resources and
Compensation Committee, the Chairman and the President and Chief
Executive Officer with respect to the performance of the
President and Chief Executive Officer and senior management in
achieving the Corporation's strategic objectives as jointly
determined by the Board and management. The Board has a policy
setting out what specific matters of a material nature must be
brought by the President and Chief Executive Officer and
management to the Board for its approval. Also, the Corporation
maintains a policy of linking compensation at the corporate
level to profitability in order to attract, retain and motivate
skilled and entrepreneurial management to ensure that management
performance bears a direct relationship to level of
compensation.
(d) a communications policy for Yes The Board has approved a disclosure policy and has mandated
the corporation; and that management have in place a program to communicate
effectively with the Corporation's shareholders. This includes a
clear and consistent explanation of the Corporation's business
strategies in its annual report; press releases covering
significant business activities; information displayed through
the Corporation's web site; and extensive presentations at each
annual meeting of shareholders which explain the Corporation's
business results for the prior year and business objectives and
strategies for the future. The Board of Directors is kept
informed of any material issues of concern raised by
shareholders and provides direction for action as required.
(e) the integrity of the Yes The Board, through the Audit Committee, has mandated that
corporation's internal control effective systems be in place to monitor the integrity of
and management information the Corporation's internal control and management
systems. information systems. The Board of Directors and the Audit
Committee are responsible for the supervision of and the
reliability of these accounting principles and practices,
financial reporting and the disclosure practices followed by
management. The Audit Committee is responsible for ensuring that
management has established an adequate system of internal
controls and maintains practices and processes to assure
compliance with applicable laws. During the fiscal year ended
April 30, 2003, the Board of Directors established an internal
audit function. The Director of Internal Audit reports to the
Chairman of the Audit Committee.
(2) The Board of Directors should be Yes If the shareholders approve the nominees proposed for
constituted with a majority of election as Directors of the Corporation at the Meeting, the
individuals who qualify as "unrelated" Board of Directors will consist of eight (8) members. In the
Directors (independent of management opinion of the Board of Directors, seven (7) of the eight
and free from conflicting interest). If (8) members of the proposed Board will qualify as
the corporation has a significant "unrelated" Directors. The Corporation does not have a
shareholder, in addition to a majority significant shareholder within the meaning of the TSX
of unrelated Directors, the board Guidelines.
should include a number of Directors
who do not have interests in or
relationships with either the
corporation or the significant
shareholder and which fairly reflects
the investment in the corporation by
shareholders other than the significant
shareholder. A significant shareholder
is a shareholder with the ability to
exercise a majority of the votes for
the election of the Board of Directors.
(3) The Board of Directors will assess and Yes Seven (7) of the eight (8) Directors on the Board, being
disclose on an annual basis (i) whether Messrs. Allen, Friend, Jespersen, MacDonald, Marvin, Nelson
the Board of Directors has a majority and Sillcox, are viewed by the Board of Directors as
of unrelated Directors, or, in the case unrelated Directors, since their respective relationships to
of a corporation with a significant the Corporation are independent of management and free from
shareholder, whether the Board is any interest and any business or other relationship which
constituted with the appropriate number could, or could reasonably be perceived to, materially
of Directors which are not related to interfere with or compromise each Director's ability to act
either the corporation or the with a view to the best interests of the Corporation, other
significant shareholder, and (ii) the than interests arising from shareholding. Mr. Jones,
analysis of the application of the President and Chief Executive Officer, is an inside Director
principles supporting this conclusion. (i.e., a Director who is an Officer and/or employee of the
Corporation or any of its affiliates) and is, by definition, a
related Director.
Except as set out above, during the fiscal year 2003, unrelated
Directors and their associates: (i) were not employees of the
Corporation or its subsidiaries, (ii) did not have a business
relationship with the Corporation, and (iii) have not received
remuneration from the Corporation or its subsidiaries (other
than Directors' remuneration), which, in the case of (ii) or
(iii), could reasonably be considered materially to interfere
with the Director's ability to act in the best interests of the
Corporation, and consequently are considered to be "unrelated"
to the Corporation.
(4) The Board of Directors should appoint a Yes The Board of Directors appointed members to the Corporate
committee of Directors, composed Governance Committee, which, among other things, has the
exclusively of outside, i.e. mandate to recommend qualified candidates for nominees to
non-management, Directors, a majority the Board of Directors, to review annually the credentials
of whom are unrelated Directors, with of nominees for re-election and to ensure qualifications are
the responsibility for proposing new maintained. The current members of the Corporate Governance
nominees to the Board of Directors and Committee are Thomas I.A. Allen, Q.C., William G. Nelson and
for assessing Directors on an ongoing Robert L. Sillcox, all of whom are outside and unrelated
basis. Directors. Mr. Charles Jones, the Executive Chairman of the
Corporation during fiscal 2003, was a member of the Committee in
fiscal 2003. He ceased to be a member of the Committee upon his
appointment as President and Chief Executive Officer of the
Corporation in July of 2003. During the period that Mr. Jones
was a member of the Corporate Governance Committee, he abstained
from meetings relating to prospective board nominees. The
Corporate Governance Committee held five meetings during the
fiscal year ended April 30, 2003.
(5) The Board of Directors should implement Yes The Corporate Governance Committee has developed a process
a process to be carried out by the by which the effectiveness of the Board, its committees and
nominating committee or other individual Directors is reviewed by the Committee Chairman
appropriate committee for assessing the and the Chairman of the Board of Directors.
effectiveness of the Board of Directors
as a whole, its committees and the
contribution of individual Directors.
(6) Every corporation should provide an Yes The Corporation considers its orientation and education
orientation and education program for program for new Directors to be an important element of
new recruits to the Board of Directors. ensuring responsible corporate governance. In addition to
extensive discussions with the Chairman of the Board and the
President and Chief Executive Officer to assist new Directors in
contributing effectively from the commencement of their election
by the shareholders, each new member is afforded opportunities
to meet with senior management and operational personnel and to
visit the Corporation's facilities. Each new member is also
provided with extensive background documentation on the
Corporation and its operations. It is the intention of the Board
of Directors that, as and when a new nominee is identified, it
will ensure that a full program of orientation and education is
provided for the nominee, including (but not limited to)
provision of a complete corporate history, including copies of
past minutes of meetings of the Board of Directors, as well as
information regarding the Corporation's business and operations.
(7) Every Board of Directors should examine Yes The Corporate Governance Committee and the Board of
its size, with a view to determining Directors as a whole from time to time examine the size of
the impact of the number upon the Board of Directors to ensure that it is the optimum size
effectiveness, and where appropriate, for decision-making. The Board has considered the size of
undertake a program to reduce the the Board and the impact of the number of Directors upon
number of Directors to a number which effectiveness and believes that the current size facilitates
facilitates more effective direct and immediate communication between the Directors and
decision-making. management and permits individual Directors to involve
themselves directly in specific matters where their personal
inclination or experience will assist the Board and management
in dealing with specific issues.
(8) The Board of Directors should review Yes The amount and form of Director compensation is reviewed
the adequacy and form of the periodically by the Human Resources and Compensation
compensation of Directors and ensure Committee, with any resultant recommendations made to the
the compensation realistically reflects full Board of Directors, to ensure that such compensation
the responsibilities and risk involved realistically reflects the responsibilities and risks of
in being an effective Director. being an effective Director. The Human Resources and
Compensation Committee is composed of three members, all of whom
are outside and unrelated Directors. The Human Resources and
Compensation Committee's mandate includes evaluating the
performance of the Corporation's executives and making
recommendations for approval by the Board with respect to the
remuneration of the executive Officers of the Corporation. The
members of the Human Resources and Compensation Committee are C.
Kent Jespersen, Pierre MacDonald and Michael D. Marvin. The
Human Resources and Compensation Committee met a total of five
times during the fiscal year ended April 30, 2003.
(9) Committees of the Board of Directors Yes The Board of Directors currently has three committees:
should generally be composed of outside Audit, Corporate Governance, and Human Resources and
Directors, a majority of whom are Compensation. Set out herein is a description of each
unrelated Directors. Committee, its respective mandate and activities. All of the
members of these Committees are outside and unrelated Directors.
While the Corporation has not established a separate Nominations
Committee, the responsibility for nominating candidates for
election as Directors is within the mandate of the Corporate
Governance Committee.
(10) The Board of Directors should expressly Yes The Corporate Governance Committee of the Board of Directors
assume responsibility for, or assign to ensures that an effective and efficient approach to
a committee of Directors, general corporate governance of the Corporation is developed and
responsibility for developing the implemented. The Corporate Governance Committee assesses the
corporation's approach to governance effectiveness of corporate governance and makes
issues. recommendations to the full Board of Directors. The Corporate
Governance Committee's mandate includes: reviewing, examining
and reporting on corporate governance issues in accordance with
TSX requirements; identifying and proposing new nominees to the
Board; and ensuring that the Board has implemented an
appropriate orientation program for new recruits to the Board to
familiarize them with the Corporation.
(11) The Board of Directors, together with Yes The Board of Directors has established a mandate and
the Chief Executive Officer, should position description that outlines the Board's obligations
develop position descriptions for the in respect of its strategic planning process, risk
Board of Directors and for the Chief management, corporate communications and integrity and
Executive Officer, including the control of internal management systems.
definition of the limits to
management's responsibilities. The
Board of Directors should approve or
develop the corporate objectives which
the Chief Executive Officer is
responsible for meeting.
Management is responsible to the Board of Directors for the
day-to-day operations of the Corporation and for the
implementation of approved corporate objectives and strategic
business plans within the context of authorized budgets,
specific delegations of authority for various matters and
corporate policies and procedures. Management is expected to
report regularly to the Board of Directors in a comprehensive,
accurate and timely fashion on the business and affairs of the
Corporation. Any responsibility that is not delegated to senior
management or to a committee of the Board of Directors remains
with the Board.
The Board of Directors sets objectives for the President and
Chief Executive Officer and reviews performance against those
objectives at least annually. These objectives include the general
mandate to implement the approved corporate objectives and the
strategic business plan. Additional information is provided above
in reference to Guideline (1).
(12) The Board of Directors should have in Yes The positions of Chairman of the Board and Chief Executive
place appropriate structures and Officer are held by different individuals. Unrelated
procedures to ensure that the Board of Directors may meet independently of management when needed
Directors can function independently of and will ask management directors to excuse themselves from
management. Board meetings when determined to be appropriate by the
unrelated Directors.
(13) The audit committee of the Board of Yes The Audit Committee of the Board of Directors is composed of
Directors should be composed only of five (5) members, all of whom are outside and unrelated
outside Directors and should have (i) Directors.
specially defined roles and
responsibilities; (ii) direct
communication channels with the
internal and external auditors; and
(iii) duties that include oversight
responsibility for management reporting
on internal control.
The Audit Committee assists the Board of Directors in fulfilling
its responsibilities for the Corporation's accounting and
financial reporting practices by reviewing the quarterly and
annual consolidated financial statements, reviewing the adequacy
of the system of internal controls, reviewing any relevant
accounting, financial and securities regulatory matters,
reviewing the management of corporate risks and recommending the
appointment of external auditors. The Audit Committee also
facilitates communication between the Board of Directors and the
Corporation's external auditors. The Audit Committee meets
quarterly with management and separately, with or without
external auditors, as required. The Audit Committee has direct
communication with both internal and external auditors.
The members of the Audit Committee are Thomas I.A. Allen, Q.C., C.
Kent Jespersen, Pierre MacDonald, William G. Nelson and Robert
L. Sillcox. The Audit Committee held eight meetings in fiscal
year 2003.
(14) The Board of Directors should implement Yes Committees of the Board or individual outside Directors may
a system which enables an individual seek independent outside advice at the expense of the
Director to engage an outside advisor Corporation after first notifying the Chairman of the Board
at the corporation's expense, in or the Board as a whole. No prior approval is required.
appropriate circumstances.
QUESTIONS AND FURTHER ASSISTANCE
If you have any questions about the information contained in this
Circular or require assistance in completing your proxy form, please contact
Georgeson Shareholder Communications Canada Inc., the Corporation's proxy
solicitation agent, at:
[GRAPHIC]
66 Wellington Street West
TD Tower -- Suite 5210
Toronto Dominion Centre
Toronto, Ontario M5K 1J3
Toll-Free Number:
1-866-261-2557