EXHIBIT 4
---------
================================================================================
HARVEST ENERGY TRUST
- AND -
NATIONAL BANK FINANCIAL INC.
- AND -
VALIANT TRUST COMPANY
SUBSCRIPTION RECEIPT AGREEMENT
PROVIDING FOR THE ISSUE OF
SUBSCRIPTION RECEIPTS
DATED AUGUST 2, 2005
================================================================================
TABLE OF CONTENTS
<
PAGE
----
ARTICLE 1 INTERPRETATION 2
1.1 Definitions 2
1.2 Headings 5
1.3 References 5
1.4 Certain Rules of Interpretation 5
1.5 Day Not a Business Day 6
1.6 Applicable Law 6
1.7 Conflict 6
1.8 Currency 6
1.9 Severability 6
ARTICLE 2 ISSUE OF SUBSCRIPTION RECEIPTS 6
2.1 Payment Acknowledgement 6
2.2 Terms and Issue of Subscription Receipts 7
2.3 Fractional Subscription Receipts 7
2.4 Register for Subscription Receipts 7
2.5 Registers Open for Inspection 7
2.6 Receiptholder not a Unitholder 8
2.7 Subscription Receipts to Rank PARI PASSU 8
2.8 Signing of Subscription Receipt Certificates 8
2.9 Certification by the Subscription Receipt Agent 8
2.10 Issue in Substitution for Subscription Receipt Certificates Lost, etc. 8
2.11 Exchange of Subscription Receipt Certificates 9
2.12 Charges for Exchange 9
2.13 Transfer and Ownership of Subscription Receipts 9
2.14 Global Subscription Receipt 10
2.15 Limitation on Non-Resident Ownership 11
2.16 Listing of Subscription Receipts 12
2.17 Right of Rescission 12
ARTICLE 3 SATISFACTION OF ISSUANCE RIGHT OR TERMINATION PAYMENT RIGHT 12
3.1 Notice of the Acquisition 12
3.2 Release of Funds on the Acquisition Date 13
3.3 Issue of Trust Units and Payment Thereon 13
3.4 Fractions 14
3.5 Payment on Termination 14
3.6 Cancellation of Surrendered Subscription Receipt Certificates 15
3.7 Additional Payments by the Trust 15
ARTICLE 4 INVESTMENT OF PROCEEDS AND PAYMENT OF INTEREST 16
4.1 Investment of Proceeds 16
4.2 Segregation of Proceeds 16
ARTICLE 5 RIGHTS OF THE TRUST AND COVENANTS 16
5.1 Optional Purchases by the Trust 16
5.2 General Covenants 16
5.3 Subscription Receipt Agent's Remuneration, Expenses and Indemnification 17
5.4 Performance of Covenants by Subscription Receipt Agent 18
5.5 Accounting 18
5.6 Payments by Subscription Receipt Agent 18
5.7 Regulatory Matters 18
ARTICLE 6 ENFORCEMENT 19
6.1 Suits by Receiptholders 19
6.2 Immunity of Unitholders, etc. 19
6.3 Limitation of Liability 19
ARTICLE 7 MEETINGS OF RECEIPTHOLDERS 19
7.1 Right to Convene Meetings 19
7.2 Notice 19
7.3 Chairman 20
7.4 Quorum 20
7.5 Power to Adjourn 20
7.6 Show of Hands 20
7.7 Poll and Voting 20
7.8 Regulations 21
7.9 Trust and Subscription Receipt Agent may be Represented 22
7.10 Powers Exercisable by Extraordinary Resolution 22
7.11 Meaning of Extraordinary Resolution 23
7.12 Powers Cumulative 23
7.13 Minutes 24
7.14 Instruments in Writing 24
7.15 Binding Effect of Resolutions 24
7.16 Holdings by Trust Disregarded 24
ARTICLE 8 SUPPLEMENTAL AGREEMENTS 24
8.1 Provision for Supplemental Agreements for Certain Purposes 24
ARTICLE 9 CONCERNING THE SUBSCRIPTION RECEIPT AGENT 25
9.1 Rights and Duties of Subscription Receipt Agent 25
9.2 Evidence, Experts and Advisers 26
9.3 Documents, Monies, etc. Held by Subscription Receipt Agent 27
9.4 Actions by Subscription Receipt Agent to Protect Interest 27
9.5 Subscription Receipt Agent not Required to Give Security 27
9.6 Protection of Subscription Receipt Agent 27
9.7 Replacement of Subscription Receipt Agent; Successor by Merger 28
9.8 Conflict of Interest 29
9.9 Acceptance of Appointment 29
9.10 Subscription Receipt Agent Not to be Appointed Receiver 29
ARTICLE 10 GENERAL 29
10.1 Notice to the Trust, Subscription Receipt Agent and the Lead
Underwriter ` 29
10.2 Notice to Receiptholders 30
10.3 Ownership and Transfer of Subscription Receipts 31
10.4 Evidence of Ownership 31
10.5 Satisfaction and Discharge of Agreement 31
10.6 Provisions of Agreement and Subscription Receipts for the Sole
Benefit of Parties and Receiptholders 32
10.7 Subscription Receipts Owned by the Trust or its Subsidiaries -
Certificate to be Provided 32
10.8 Effect of Execution 32
10.9 Trust Obligations 32
10.10 Time of Essence 33
10.11 Counterparts 33
SUBSCRIPTION RECEIPT AGREEMENT
THIS SUBSCRIPTION RECEIPT AGREEMENT made as of the 2nd day of
August, 2005.
BETWEEN:
HARVEST ENERGY TRUST, a trust established under and
governed by the laws of the Province of Alberta
(hereinafter referred to as the "TRUST")
AND
NATIONAL BANK FINANCIAL INC. (hereinafter referred to as the
"LEAD UNDERWRITER"), on behalf of the underwriters who are party to the
Underwriting Agreement providing for the issue and sale to investors of the
Subscription Receipts
AND
VALIANT TRUST COMPANY, a trust company authorized to carry on
business in all Provinces of Canada (hereinafter referred to as the
"SUBSCRIPTION RECEIPT AGENT")
WHEREAS the Trust is proposing to issue and sell Subscription
Receipts representing the right to receive Trust Units;
AND WHEREAS the Trust and the Lead Underwriter, on behalf of
the Underwriters, have agreed that:
(a) the Proceeds are to be delivered to and held by the
Subscription Receipt Agent and invested on behalf of the holders of Subscription
Receipts in the manner set forth herein;
(b) if the Acquisition Time occurs by the Deadline, each holder of
Subscription Receipts shall be entitled to receive, without additional
consideration, one Trust Unit for each Subscription Receipt held together with
the holder's Acquisition Payment less applicable withholding taxes; and
(c) if the Acquisition Time does not occur by the Deadline, the
Acquisition is terminated at any earlier time or the Trust has advised the Lead
Underwriter on behalf of the Underwriters or announced to the public that it
does not intend to proceed with the Acquisition, the subscription for Trust
Units represented by each Subscription Receipt shall be automatically terminated
and cancelled and each holder of Subscription Receipts shall be entitled to
receive from the Trust an amount equal to the Subscription Price in respect of
each Subscription Receipt held together with such holder's PRO RATA share of
Earned Interest, less applicable withholding taxes;
AND WHEREAS all things necessary have been done and performed
to make the Subscription Receipts, when certified by the Subscription Receipt
Agent and issued as provided in this Agreement, legal, valid and binding
obligations of the Trust with the benefits and subject to the terms of this
Agreement;
AND WHEREAS the foregoing recitals are by the Trust and the
Lead Underwriter, on behalf of the Underwriters, as the context provides, and
not by the Subscription Receipt Agent;
NOW THEREFORE THIS AGREEMENT WITNESSES that for good and
valuable consideration mutually given and received, the receipt and sufficiency
of which is hereby acknowledged, it is hereby agreed and declared as follows:
ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS
In this Agreement and the recitals, unless there is something
in the subject matter or context inconsistent therewith or unless otherwise
expressly provided, the following terms shall have the respective meanings set
out below and grammatical variations of such terms shall have corresponding
meanings:
(a) "ABCA" means the BUSINESS CORPORATIONS ACT (Alberta), R.S.A.
2000, c.B-9, as amended, including the regulations promulgated thereunder;
(b) "ACQUISITION" means the acquisition of Nexen Canada No. 1,
which owns the New Properties and related assets, from the Vendor by Harvest
Breeze Trust No. 1 and Harvest Breeze Trust No. 2 pursuant to the Purchase
Agreement;
(c) "ACQUISITION DATE" means the date upon which the closing of
the Acquisition takes place, and "ACQUISITION TIME" means the time on the
Acquisition Date at which the closing of the Acquisition takes place;
(d) "ACQUISITION PAYMENT" means an amount per Subscription Receipt
equal to the amount per Trust Unit of any cash distributions for which record
dates have occurred during the period from and including the date hereof to but
excluding the date the Trust Units are issued or deemed to be issued hereunder
pursuant to the Subscription Receipts;
(e) "AGREEMENT" means this agreement, as amended, supplemented or
otherwise modified from time to time in accordance with the provisions hereof;
(f) "BENEFICIAL HOLDER" means any person who holds a beneficial
interest in a Subscription Receipt;
(g) "BOOK-ENTRY ONLY SYSTEM" means the book-based securities
transfer system administered by CDS in accordance with its operating rules and
procedures in force from time to time;
(h) "BUSINESS DAY" means a day which is not Saturday or Sunday or
a holiday in Calgary, Alberta or Toronto, Ontario;
(i) "CDS" means The Canadian Depositary for Securities Limited and
its successors in interest;
(j) "CORPORATION" means Harvest Operations Corp., a corporation
amalgamated under the ABCA;
(k) "COUNSEL" means a barrister or solicitor or a firm of
barristers or solicitors, who may be counsel for the Trust, acceptable to the
Subscription Receipt Agent, acting reasonably;
(l) "CURRENT MARKET PRICE" means in respect of a Trust Unit on any
date, the weighted average trading price of a Trust Unit on the Toronto Stock
Exchange for the 5 trading days preceding that date, or, if the Trust Units are
not then listed on the Toronto Stock Exchange, on such other stock
exchange or automated quotation system on which the Trust Units are
listed or quoted, as the case may be, as may be selected by the Board of
Directors of the Corporation for such purpose provided, however, that if in the
opinion of the Board of Directors of the Corporation the public distribution or
trading activity of Trust Units for that period does not result in a weighted
average trading price which reflects the fair market value of a Trust Unit, then
the Current Market Price of a Trust Unit shall be determined by the Board of
Directors of the Corporation in good faith and in its sole discretion, and
provided further that any such selection, opinion or determination by the Board
of Directors of the Corporation shall be conclusive and binding;
(m) "DEADLINE" means 5:00 p.m. (Calgary time) September 30, 2005;
(n) "DEBENTURES" means the 6.5% convertible unsecured subordinated
debentures of the Trust offered in conjunction with the Subscription Receipts
under the Prospectus;
(o) "DESIGNATED OFFICE" means the principal stock transfer office
of the Subscription Receipt Agent from time to time in the city of Calgary;
(p) "EARNED INTEREST" means the interest or other income actually
earned on the investment of the Escrowed Funds between the date hereof and the
earlier to occur of the Acquisition Date and the Termination Date;
(q) "ESCROWED FUNDS" means the Proceeds, all interest or other
income earned and any investments acquired from time to time with such funds;
(r) "GLOBAL SUBSCRIPTION RECEIPT" means a Subscription Receipt
Certificate that is issued to and registered in the name of CDS (or its nominee)
pursuant to Section 2.14 hereof;
(s) "HARVEST BREEZE TRUST NO. 1" means Harvest Breeze Trust No. 1,
a trust formed pursuant to the laws of Alberta;
(t) "HARVEST BREEZE TRUST NO. 2" means Harvest Breeze Trust No. 2,
a trust formed pursuant to the laws of Alberta;
(u) "ISSUE DATE" means the date upon which the notice and press
release contemplated by Section 3.1 have been delivered or issued, as the case
may be;
(v) "ISSUE TIME" means 5:00 p.m. (Calgary time), on the Issue
Date;
(w) "LEAD UNDERWRITER" means National Bank Financial Inc.;
(x) "NEW PARTNERSHIP" means Nexen Canada No. 1, a general
partnership formed under the laws of Alberta;
(y) "NEW PROPERTIES" means crude oil and natural gas properties
held in the New Partnership and related assets to be indirectly acquired by
Harvest Breeze Trust No. 1 and Harvest Breeze Trust No. 2 pursuant to the
Purchase Agreement, described in more detail in the Prospectus under the heading
"Information Concerning the New Properties";
(z) "NON-RESIDENTS" means non-residents of Canada within the
meaning of the INCOME TAX ACT (Canada) and the regulations promulgated
thereunder, as amended from time to time;
(aa) "PERSON" includes an individual, corporation, company,
partnership, joint venture, association, trust, trustee, unincorporated
organization or government or any agency or political subdivision
thereof;
(bb) "PROCEEDS" means the amount of $26.90, being an amount equal
to the Subscription Price, for each Subscription Receipt issued, being
an aggregate of $175,000,640;
(cc) "PROSPECTUS" means the English language version (unless the
context indicates otherwise) of the (final) short form prospectus of
the Trust dated July 20, 2005 relating to, INTER ALIA, the distribution
of the Subscription Receipts and the Debentures in all of the Provinces
of Canada and, unless the context otherwise requires, includes all
documents incorporated therein by reference and any amendments thereto;
(dd) "PURCHASE AGREEMENT" means the partnership purchase and sale
agreement dated June 23, 2005 among Harvest Breeze Trust No. 1, Harvest
Breeze Trust No. 2 and the Vendor;
(ee) "RECEIPTHOLDERS", or "HOLDERS" means the holders registered
holders from time to time of Subscription Receipts;
(ff) "RECEIPTHOLDERS' REQUEST" means an instrument signed in one or
more counterparts by Receiptholders entitled to acquire in the
aggregate not less than 25% of the then outstanding Subscription
Receipts, requesting the Subscription Receipt Agent to take some action
or proceeding specified therein;
(gg) "SUBSCRIPTION PRICE" means the sum of $26.90 per Subscription
Receipt;
(hh) "SUBSCRIPTION RECEIPT AGENT" means Valiant Trust Company or
its successors from time to time under this Agreement;
(ii) "SUBSCRIPTION RECEIPT CERTIFICATE" means a certificate
evidencing Subscription Receipts in the form attached as Schedule A
hereto;
(jj) "SUBSCRIPTION RECEIPTS" means the subscription receipts issued
and certified hereunder and from time to time outstanding, each
Subscription Receipt evidencing the rights set out in Subsection
2.2(a);
(kk) "SURRENDER FORM" means the surrender form on the Subscription
Receipt Certificate;
(ll) "TERMINATION DATE" means the earliest of: (i) the Deadline;
(ii) the date upon which the Trust delivers to the Lead Underwriter, on
behalf of the Underwriters, and to the Subscription Receipt Agent, a
notice executed by the Trust that the Acquisition has been terminated
or that the Trust does not intend to proceed with the Acquisition, and
(iii) the date upon which the Trust announces to the public that it
does not intend to proceed with the Acquisition;
(mm) "TERMINATION PAYMENT TIME" means 5:00 p.m. (Calgary time) on
the second Business Day after the Termination Date;
(nn) "TRUST" means Harvest Energy Trust;
(oo) "TRUST INDENTURE" means the amended and restated trust
indenture dated January 1, 2004 between the Trustee and the Corporation
as such indenture may be further amended by supplemental indentures
from time to time;
(pp) "TRUST UNITS" means the units of the Trust issued pursuant to
the Trust Indenture, each unit evidencing an undivided beneficial
interest in the Trust;
(qq) "TRUSTEE" means the trustee of the Trust from time to time;
(rr) "UNDERWRITERS" means, collectively, National Bank Financial
Inc., TD Securities Inc., CIBC World Markets Inc., Scotia Capital Inc.,
Canaccord Capital Corporation, GMP Securities Ltd., FirstEnergy Capital
Corp., Tristone Capital Inc., Haywood Securities Inc. and Raymond James
Ltd.;
(ss) "UNDERWRITING AGREEMENT" means the agreement dated as of July
11, 2005 among the Trust, the Corporation and the Underwriters in
respect of the offering of Subscription Receipts and Debentures by the
Trust;
(tt) "UNITHOLDERS" means the registered holders from time to time
of Trust Units;
(uu) "VENDOR" means Nexen Inc. and certain corporations and
partnerships controlled by it; and
(vv) "WRITTEN REQUEST OF THE TRUST" and "CERTIFICATE OF THE TRUST"
mean, respectively, a written request and certificate signed in the
name of the Trust by the Trustee or by the Corporation in its capacity
as administrator of the Trust and may consist of one or more
instruments so executed.
1.2 HEADINGS
The headings, the table of contents and the division of this
Agreement into Articles and Sections are for convenience of reference only and
shall not affect the interpretation of this Agreement.
1.3 REFERENCES
Unless otherwise specified in this Agreement:
(a) references to Articles, Sections, and Schedules are to
Articles, Sections, and Schedules in this Agreement; and
(b) "hereto", "herein", "hereby", "hereunder", "hereof " and
similar expressions, without reference to a particular provision, refer to this
Agreement.
1.4 CERTAIN RULES OF INTERPRETATION
Unless otherwise specified in this Agreement:
(a) the singular includes the plural and VICE VERSA; and
(b) references to any gender shall include references to all
genders.
1.5 DAY NOT A BUSINESS DAY
In the event that any day on or before which any action is
required to be taken hereunder is not a Business Day, then such action shall be
required to be taken at or before the requisite time on the next succeeding day
that is a Business Day.
1.6 APPLICABLE LAW
This Agreement and the Subscription Receipts shall be governed
by and construed in accordance with the laws of the Province of Alberta and the
laws of Canada applicable therein.
1.7 CONFLICT
In the event of a conflict or inconsistency between a
provision in the body of this Agreement and in any Subscription Receipt
Certificate issued hereunder, the provision in the body of this Agreement shall
prevail to the extent of the inconsistency.
1.8 CURRENCY
All dollars amounts expressed in this Agreement and in the
Subscription Receipts are in lawful money of Canada and all payments required to
be made hereunder or thereunder shall be made in Canadian dollars.
1.9 SEVERABILITY
Each of the provisions in this Agreement is distinct and
severable and a declaration of invalidity or unenforceability of any such
provision or part thereof by a court of competent jurisdiction shall not affect
the validity or enforceability of any of the other provisions hereof.
ARTICLE 2
ISSUE OF SUBSCRIPTION RECEIPTS
2.1 PAYMENT ACKNOWLEDGEMENT
(a) The Subscription Receipt Agent hereby acknowledges receipt
from the Lead Underwriter of a wire transfer of funds in the aggregate amount of
$175,000,640 and confirms that such funds have been deposited in a segregated
account in the name of the Trust designated as "Harvest Energy Trust - Sub.
Receipts", or as otherwise directed by the Trust and the Lead Underwriter, and
the Subscription Receipt Agent will retain such amount in accordance with the
terms of this Agreement pending payment of such amount in accordance with the
terms of this Agreement.
(b) The Trust hereby:
(i) acknowledges that the amount received by the
Subscription Receipt Agent pursuant to Section 2.1(a) in accordance
with the Trust's direction to the Lead Underwriter, represents payment
in full by the Underwriters of the Subscription Price for 6,505,600
Subscription Receipts; and
(ii) irrevocably directs the Subscription Receipt Agent to
retain such amount in accordance with the terms of this Agreement
pending payment of such amount in accordance with the terms of this
Agreement.
2.2 TERMS AND ISSUE OF SUBSCRIPTION RECEIPTS
(a) Each Subscription Receipt shall evidence the right of the
holder: (i) if the Acquisition Time occurs by the Deadline, to receive, for no
additional consideration, one Trust Unit plus such holder's Acquisition Payment,
if any, less applicable withholding taxes; or (ii) if the Acquisition Time does
not occur by the Deadline, the Acquisition is terminated at any earlier time or
the Trust has advised the Underwriters or announced to the public that it does
not intend to proceed with the Acquisition, to receive an amount equal to the
sum of the Subscription Price and such holder's PRO RATA share of the Earned
Interest, less applicable withholding taxes, all in the manner and on the terms
and conditions set out in this Agreement.
(b) A maximum of 6,505,600 Subscription Receipts are hereby
created and authorized to be issued.
(c) The Subscription Receipt Certificates (including all
replacements issued in accordance with this Agreement) shall be substantially in
the form attached hereto as SCHEDULE "A", shall bear such distinguishing letters
and numbers and such legends as the Trust may, with the approval of the
Subscription Receipt Agent, prescribe, and shall be issuable in any whole number
denominations.
(d) The Subscription Receipt Agent is hereby directed, immediately
following the execution and delivery of this Agreement, to execute, issue and
deliver to the Lead Underwriter, on behalf of the Underwriters, one definitive
Global Subscription Receipt Certificate representing 5,997,600 Subscription
Receipts registered in the name of CDS (or its nominee) and one definitive
Global Subscription Receipt Certificate representing 508,000 Subscription
Receipts (bearing a legend as to U.S. resale restrictions) registered in the
name of CDS (or its nominee).
2.3 FRACTIONAL SUBSCRIPTION RECEIPTS
No fractional Subscription Receipts shall be issued or
otherwise provided for hereunder.
2.4 REGISTER FOR SUBSCRIPTION RECEIPTS
The Trust hereby appoints the Subscription Receipt Agent as
registrar of the Subscription Receipts, and the Trust shall cause to be kept by
the Subscription Receipt Agent at the Designated Office, a securities register
in which shall be entered the names and addresses of holders of Subscription
Receipts and the other particulars, prescribed by law, of the Subscription
Receipts held by them. The Trust shall also cause to be kept by the Subscription
Receipt Agent at the Designated Office the register of transfers, and may also
cause to be kept by the Subscription Receipt Agent, at such place or places
approved by the Subscription Receipt Agent, branch registers of transfers in
which shall be recorded the particulars of the transfers of Subscription
Receipts registered in that branch register of transfers.
2.5 REGISTERS OPEN FOR INSPECTION
The registers hereinbefore referred to shall be open at all
reasonable times during regular business hours of the Subscription Receipt Agent
on a Business Day for inspection by the Trust, the Subscription Receipt Agent
or, subject to applicable law, any Receiptholder. The Subscription Receipt Agent
shall, from time to time when requested so to do by the Trust, furnish the Trust
with a list of the names and addresses of Receiptholders entered in the
registers kept by the Subscription Receipt Agent and showing the number of
Subscription Receipts held by each such holder.
2.6 RECEIPTHOLDER NOT A UNITHOLDER
Nothing in this Agreement or in the holding of a Subscription
Receipt evidenced by a Subscription Receipt Certificate or otherwise, shall
confer or be construed as conferring upon a Receiptholder any right or interest
whatsoever as a Unitholder, including, but not limited to, the right to vote at,
to receive notice of, or to attend meetings of Unitholders, or the right to
receive distributions or any continuous disclosure materials of the Trust.
Receiptholders are entitled to exercise the rights expressly provided for in the
Subscription Receipts and this Agreement on the terms and conditions set forth
herein.
2.7 SUBSCRIPTION RECEIPTS TO RANK PARI PASSU
All Subscription Receipts shall rank PARI PASSU, whatever may
be the actual date of issue of same.
2.8 SIGNING OF SUBSCRIPTION RECEIPT CERTIFICATES
The Subscription Receipt Certificates shall be signed by an
officer of the Corporation, the Trust's administrator, on behalf of the Trust.
The signature of such officer may be mechanically reproduced in facsimile and
Subscription Receipt Certificates bearing such facsimile signature shall,
subject to Section 2.9, be binding upon the Trust as if they had been manually
signed by such officer. Notwithstanding that the person whose manual or
facsimile signature appears on any Subscription Receipt Certificate as such
officer may no longer hold such position at the date of such Subscription
Receipt Certificate or at the date of certification or delivery thereof, any
Subscription Receipt Certificate signed as aforesaid shall, subject to Section
2.9, be valid and binding upon the Trust and the holder thereof shall be
entitled to the benefits of this Agreement.
2.9 CERTIFICATION BY THE SUBSCRIPTION RECEIPT AGENT
(a) No Subscription Receipt Certificate shall be issued or, if
issued, shall be valid for any purpose or entitle the holder to the benefit
hereof until it has been certified by manual signature by or on behalf of the
Subscription Receipt Agent, and such certification by the Subscription Receipt
Agent upon any Subscription Receipt Certificate shall be conclusive evidence as
against the Trust that the Subscription Receipt Certificate so certified has
been duly issued hereunder and that the holder is entitled to the benefits
hereof.
(b) The certification of the Subscription Receipt Agent on
Subscription Receipt Certificates issued hereunder shall not be construed as a
representation or warranty by the Subscription Receipt Agent as to the validity
of this Agreement or the Subscription Receipt Certificates (except the due
certification thereof) and the Subscription Receipt Agent shall in no respect be
liable or answerable for the use made of the Subscription Receipt Certificates
or any of them or of the consideration therefor except as otherwise specified
herein. The certificate by or on behalf of the Subscription Receipt Agent on
Subscription Receipt Certificates shall constitute a representation and warranty
by the Subscription Receipt Agent that the said Subscription Receipt
Certificates have been duly certified by or on behalf of the Subscription
Receipt Agent pursuant to the provisions of this Agreement.
2.10 ISSUE IN SUBSTITUTION FOR SUBSCRIPTION RECEIPT CERTIFICATES LOST, ETC.
(a) In case any Subscription Receipt Certificate shall become
mutilated or be lost, destroyed or stolen, the Trust, subject to applicable law
and compliance with paragraph (b) below, shall issue and thereupon the
Subscription Receipt Agent shall certify and deliver, a new Subscription Receipt
Certificate of like tenor as the one mutilated, lost, destroyed or stolen in
exchange for and in place of and upon cancellation of such mutilated
Subscription Receipt Certificate, or in lieu of and in substitution for such
lost, destroyed or stolen Subscription Receipt Certificate, and the substituted
Subscription Receipt Certificate shall be in a form approved by the Subscription
Receipt Agent and shall be entitled to the benefits hereof and shall rank
equally in accordance with its terms with all other Subscription Receipt
Certificates issued or to be issued hereunder.
(b) The applicant for the issue of a new Subscription Receipt
Certificate pursuant to this Section 2.10 shall bear the cost of the issue
thereof and in case of loss, destruction or theft shall, as a condition
precedent to the issue thereof, furnish to the Trust and to the Subscription
Receipt Agent such evidence of ownership and of the loss, destruction or theft
of the Subscription Receipt Certificate so lost, destroyed or stolen as shall be
satisfactory to the Trust and to the Subscription Receipt Agent in their sole
discretion, and such applicant may also be required to furnish an indemnity or
security in amount and form satisfactory to the Trust and the Subscription
Receipt Agent in their sole discretion and shall pay the reasonable charges of
the Trust and the Subscription Receipt Agent in connection therewith.
2.11 EXCHANGE OF SUBSCRIPTION RECEIPT CERTIFICATES
(a) Subscription Receipt Certificates may, upon compliance with
the reasonable requirements of the Subscription Receipt Agent, be exchanged for
another Subscription Receipt Certificate or Subscription Receipt Certificates
entitling the holder thereof to, in the aggregate, the same number of
Subscription Receipts as represented by the Subscription Receipt Certificates so
exchanged.
(b) Subscription Receipt Certificates may be surrendered for
exchange only at the Designated Office during regular business hours of the
Subscription Receipt Agent.
2.12 CHARGES FOR EXCHANGE
Except as otherwise herein provided, the Subscription Receipt
Agent may charge to the holder requesting an exchange a reasonable sum for each
new Subscription Receipt Certificate issued in exchange for Subscription Receipt
Certificate(s). Payment of such charges and reimbursement of the Subscription
Receipt Agent or the Trust for any and all stamp taxes or governmental or other
charges required to be paid shall be made by such holder as a condition
precedent to such exchange.
2.13 TRANSFER AND OWNERSHIP OF SUBSCRIPTION RECEIPTS
(a) Subject to Sections 2.13(d), 2.14 and 2.15, there are no
restrictions on the transfer of the Subscription Receipts. However, the
Subscription Receipts may only be transferred on the register kept at the
Designated Office by the holder or his legal representatives or his attorney
duly appointed by an instrument in writing. Upon surrender for registration of
transfer of Subscription Receipts at the Designated Office and upon compliance
with Sections 2.14 and 2.15, the Trust shall issue and thereupon the
Subscription Receipt Agent shall certify and deliver a new Subscription Receipt
Certificate of like tenor in the name of the designated transferee. If less than
all the Subscription Receipts evidenced by the Subscription Receipt
Certificate(s) so surrendered are transferred, the transferor shall be entitled
to receive, in the same manner, a new Subscription Receipt Certificate
registered in his name evidencing the Subscription Receipts not transferred.
However, notwithstanding the foregoing, Subscription Receipts shall only be
transferred upon:
(i) payment to the Subscription Receipt Agent of a
reasonable sum for each new Subscription Receipt Certificate issued
upon such transfer, and reimbursement of the Subscription Receipt Agent
or the Trust for any and all stamp taxes or governmental or other
charges required to be paid in respect of such transfer; and
(ii) such reasonable requirements as the Subscription
Receipt Agent may prescribe,
and all such transfers shall be duly noted in such register by the
Subscription Receipt Agent.
(b) The Trust and the Subscription Receipt Agent shall deem and
treat the registered owner of any Subscription Receipt as the beneficial owner
thereof for all purposes and neither the Trust nor the Subscription Receipt
Agent shall be affected by any notice to the contrary.
(c) The transfer register in respect of Subscription Receipts
shall be closed at 5:00 p.m. (Calgary time) at the Designated Office, on the
earlier to occur of the Acquisition Date and the Termination Date (subject to
settlement).
(d) The Subscription Receipt Agent shall promptly advise the Trust
of any requested transfer of Subscription Receipts. The Trust shall be entitled,
and may direct the Subscription Receipt Agent, to refuse to recognize any
transfer, or enter the name of any transferee, of any Subscription Receipts on
the registers referred to in this Article, if such transfer would constitute a
violation of the securities laws of any jurisdiction or the rules, regulations
or policies of any regulatory authority having jurisdiction.
(e) Subject to the provisions of this Agreement and applicable
law, a Receiptholder shall be entitled to the rights and privileges attaching to
the Subscription Receipts. Either the issue and delivery of Trust Units and the
payment of the Earned Interest and applicable Acquisition Payment, each less
applicable withholding taxes, as provided in Section 3.3, or the payment of the
Subscription Price and the Earned Interest, each less applicable withholding
taxes, as provided in Section 3.5, all in accordance with the terms and
conditions herein contained, shall discharge all responsibilities of the Trust
and the Subscription Receipt Agent with respect to such Subscription Receipts
and neither the Trust nor the Subscription Receipt Agent shall be bound to
inquire into the title of a Receiptholder or a transferee of Subscription
Receipts who surrenders a Subscription Receipt Certificate.
GLOBAL SUBSCRIPTION RECEIPT
(a) Unless the Book-Entry Only System is terminated, Subscription
Receipt Certificates will only be issued in the form of one or more Global
Subscription Receipt certificates, which will be registered in the name of and
deposited with CDS (or its nominee).
(b) Unless the Book-Entry Only System is terminated, owners of the
beneficial interests in the Subscription Receipts shall not be entitled to have
Subscription Receipts registered in their names, shall not receive or be
entitled to receive Subscription Receipt Certificates in definitive form and
shall not be considered owners or holders thereof under this Agreement or any
supplemental agreement except in circumstances where CDS resigns or is removed
from its responsibility and the Subscription Receipt Agent is unable or does not
wish to locate a qualified successor. Beneficial interests in the Global
Subscription Receipt will be represented only through the Book-Entry Only
System. Transfers of Subscription Receipts between CDS participants shall occur
in accordance with CDS' rules and procedures. The Trust and the Subscription
Receipt Agent shall not have any responsibility or liability for any aspects of
the
records relating to or payments made by CDS, or its nominee, on account
of the beneficial interests in the Subscription Receipts. Nothing herein shall
prevent the owners of beneficial interests in the Subscription Receipts from
voting such Subscription Receipts using duly executed proxies.
(c) All references herein to actions by, notices given or payments
made to Receiptholders shall, where Subscription Receipts are held through CDS,
refer to actions taken by, or notices given or payments made to, CDS upon
instruction from the CDS participants in accordance with its rules and
procedures. For the purposes of any provision hereof requiring or permitting
actions with the consent of or at the direction of Receiptholders evidencing a
specified percentage of the aggregate Subscription Receipts outstanding, such
direction or consent may be given by holders of Subscription Receipts acting
through CDS and the CDS participants owning Subscription Receipts evidencing the
requisite percentage of the Subscription Receipts. The rights of a Receiptholder
whose Subscription Receipts are held through CDS shall be exercised only through
CDS and the CDS participants and shall be limited to those established by law
and agreements between such holders and CDS and the CDS participants upon
instructions from the CDS participants. Each of the Subscription Receipt Agent
and the Trust may deal with CDS for all purposes (including the making of
payments) as the authorized representative of the respective Receiptholders and
such dealing with CDS shall constitute satisfaction or performance, as
applicable, of their respective obligations hereunder.
(d) For so long as Subscription Receipts are held through CDS, if
any notice or other communication is required to be given to Receiptholders, the
Subscription Receipt Agent will give such notices and communications to CDS.
(e) If CDS resigns or is removed from its responsibility as
depository and the Subscription Receipt Agent is unable or does not wish to
locate a qualified successor, CDS shall surrender the Global Subscription
Receipts to the Subscription Receipt Agent with instructions for registration of
Subscription Receipts in the name and in the amount specified by CDS and the
Trust shall issue and the Subscription Receipt Agent shall certify and deliver
the aggregate number of Subscription Receipts then outstanding in the form of
definitive Subscription Receipt Certificates representing such Subscription
Receipts.
LIMITATION ON NON-RESIDENT OWNERSHIP
At no time may more than one-half of the outstanding Trust
Units be held by Non-Residents. The Trust may direct the Subscription Receipt
Agent to require declarations as to the jurisdictions in which beneficial owners
of Subscription Receipts are resident, which will be delivered to the
Subscription Receipt Agent. If the Subscription Receipt Agent becomes aware, as
a result of such declarations as to beneficial ownership or otherwise, that the
beneficial owners of 49% of the Trust Units then outstanding (on a fully-diluted
basis assuming Trust Units are issued in exchange for the Subscription Receipts)
are, or may be, Non-Residents or that such a situation is imminent, the Trust
may direct the Subscription Receipt Agent to make a public announcement thereof
and, following notification to the Trust of such announcement, the Trust may
direct the Subscription Receipt Agent to not register a transfer of Subscription
Receipts to a person unless the person provides a declaration in form and
content satisfactory to the Trust, as provided to the Subscription Receipt Agent
that the person is not a Non-Resident. If, notwithstanding the foregoing, the
Subscription Receipt Agent in carrying out the directions of the Trust
determines that a majority of the holders of Trust Units (on a fully-diluted
basis assuming Trust Units are issued in exchange for the Subscription Receipts)
are held by non-residents, the Trust may direct the Subscription Receipt Agent
to send a notice to Non-Resident Receiptholders, chosen in inverse order to the
order of acquisition or registration or in such other manner as the Trust may
direct, requiring them to sell their Subscription Receipts or a portion thereof
within a specified period of not less than 60 days. If the Non-Resident
Receiptholders receiving such notice have not sold the specified number of
Subscription Receipts or provided the Subscription Receipt Agent, as confirmed
by the Trust, with satisfactory evidence that they are not Non-Residents within
such period, the Trust may direct the Subscription Receipt Agent, on behalf of
such Non-Resident Receiptholders, to sell such Subscription Receipts and, in the
interim, to suspend the voting and interest rights attached to such Subscription
Receipts. Upon such sale, the affected Non-Resident Receiptholders shall cease
to be holders of Subscription Receipts and their rights shall be limited to
receiving the net proceeds of sale upon surrender of the applicable Subscription
Receipts. The Subscription Receipt Agent is, upon direction of the Trust,
empowered to take all steps necessary, including cancelling Subscription
Receipts and amending the register, as are required to effect any such sale. For
greater certainty the Subscription Receipt Agent has no obligation to actively
monitor holdings of Non-Residents and is only required to follow the express
written directions of the Trust in accordance with this Agreement.
2.16 LISTING OF SUBSCRIPTION RECEIPTS
The Trust confirms that the Subscription Receipts will be
listed for trading on the Toronto Stock Exchange.
2.17 RIGHT OF RESCISSION
(a) If the Prospectus, together with any amendment thereto,
contains a misrepresentation (as such term is defined in the SECURITIES ACT
(Alberta)) and it was a misrepresentation on the date hereof, purchasers of
Subscription Receipts to whom the Prospectus was sent or delivered and who were
the original purchasers of the Subscription Receipts (the "Original Purchasers")
shall have a right of action against the Trust for rescission to receive the
Subscription Price exercisable on notice given to the Trust not more than 180
days subsequent to the date hereof. The right of action for rescission is only
available to an Original Purchaser either while he or she is a holder of the
Subscription Receipts purchased or while he or she is a holder of the Trust
Units issuable upon surrender of such Subscription Receipts.
(b) In no event shall the Trust be liable under this Section 2.17
if the Original Purchaser purchased the Subscription Receipts with knowledge of
the misrepresentation.
ARTICLE 3
SATISFACTION OF ISSUANCE RIGHT
OR TERMINATION PAYMENT RIGHT
3.1 NOTICE OF THE ACQUISITION
If, prior to the Deadline, the Trust is in a position to close
the Acquisition, it:
(a) shall cause to be delivered to the Subscription Receipt Agent
a notice executed by the Trust and by the Lead Underwriter, on behalf of the
Underwriters, containing the following:
(i) a certification that all conditions precedent to the
completion of the Acquisition have been satisfied or waived (other than
the delivery of funds);
(ii) the specifics relating to the nature of a waiver, if
any, of a material closing condition for the benefit of Harvest Breeze
Trust No. 1 and Harvest Breeze Trust No. 2 contained in the Purchase
Agreement; and
(iii) that Harvest Breeze Trust No. 1 and Harvest Breeze
Trust No. 2 are in a position to complete the Acquisition (or which
notice shall contain any such other terms as Harvest Breeze Trust No. 1
and Harvest Breeze Trust No. 2 and the Subscription Receipt Agent, with
the consent of the Lead Underwriter, may agree upon);
(b) shall direct the Subscription Receipt Agent in writing to
issue and deliver the Trust Units issuable pursuant to the Subscription Receipts
and make the payments as provided for herein; and
(c) shall, after the Acquisition Time, issue a press release
setting out the Acquisition Date and that the Trust Units will be issued
effective as at the Issue Time.
3.2 RELEASE OF FUNDS ON THE ACQUISITION DATE
Upon the receipt of the joint notice set forth in Section 3.1,
the Trust shall be entitled to receive from the Subscription Receipt Agent the
Proceeds, less: (i) the amount, if any, required to make the payments set forth
in Sections 3.3(b)(i) and (ii) (the "Released Amount"). The Subscription Receipt
Agent shall deliver the Released Amount to the Trust, or to such other party as
the Trust directs in writing, as soon as reasonably practicable after the
delivery of the notice referred to in Section 3.1 and in any event not later
than the Issue Time.
3.3 ISSUE OF TRUST UNITS AND PAYMENT THEREON
(a) If the Acquisition Time occurs by the Deadline, the Trust
Units shall be and shall be deemed to be issued to the Receiptholder in
accordance with the right of such holder as described in Section 2.2(a) hereof
(which right shall be and shall be deemed to be exercised upon the occurrence of
the Acquisition Time) and such Trust Units shall be deemed to be issued pursuant
to the Trust Indenture at the Issue Time, notwithstanding that a certificate or
a Book-Entry Only System customer confirmation therefor may not yet have been
issued or entered, as the case may be, and the persons to whom such Trust Units
are to be issued in accordance with the provisions of this Agreement shall be
deemed to have become the holders of record of such Trust Units at the Issue
Time.
(b) If the Acquisition Time occurs by the Deadline, the holder of
a Subscription Receipt (or a transferee thereof if all applicable transfer
requirements, other than registration, have been satisfied) shall be entitled
from and after the Issue Time, but shall receive (subject to Section 3.1) no
earlier than on the second Business Day following the Acquisition Date, a
certificate representing the applicable number of Trust Units issuable pursuant
to such holder's Subscription Receipts and a cheque in an amount of (i) such
holder's PRO RATA share of any Earned Interest less applicable withholding taxes
and (ii) the difference, if any, between the holder's Acquisition Payment and
such holder's PRO RATA share of the Earned Interest, less applicable withholding
taxes; provided that to the extent that the amount in (ii), if any, represents
amounts in respect of cash distributions for which record dates have occurred
but which have not yet been paid, such amount shall not be payable to holders,
unless the Trust otherwise elects, until the date such cash distributions are
paid to Unitholders; and provided further that if the holder is not entitled to
an Acquisition Payment such holder's PRO RATA share of any Earned Interest shall
be paid to the Trust in accordance with Section 3.2. The amount paid to each
holder under (i), if any, shall be satisfied by the Earned Interest and the
amount in (ii), if any, shall be satisfied by the Escrowed Funds as provided in
Section 3.2. If the Escrowed Funds and Earned Interest are not sufficient to
meet the payments required by this Section 3.3(b), the Subscription Receipt
Agent shall only make payments under this section to the extent monies have been
deposited with it pursuant to Section 3.7.
(c) Upon the issuance or deemed issuance of the Trust Units
pursuant to the Subscription Receipts, the Trust, subject to the provisions of
the Trust Indenture, shall direct CDS to cause to be entered and issued, as the
case may be, to the person or persons in whose name or names such Trust Units
have been issued, a Book-Entry Only System customer confirmation, together with
a cheque or cheques or wire transfer for the amounts specified in Section
3.3(b).
(d) Effective immediately after the Trust Units have been issued
as contemplated in Section 3.3(a) and the certificates representing such Trust
Units have been entered and issued, as the case may be, as provided in Section
3.3(c) and the cheque or cheques for the amount specified in Section 3.3(b) have
been issued and mailed or delivered (and provided such cheque or cheques have
been honoured for payment, if presented for payment within six months of the
date hereof), the Subscription Receipts relating thereto shall be void and of no
value or effect. For greater certainty, any Escrowed Funds, interest or other
monies held by the Subscription Receipt Agent pursuant hereto after the cheque
or cheques for the amount specified in Section 3.3(b) have been mailed or
delivered, as the case may be, shall be delivered to the Trust as soon as
reasonably practicable thereafter.
3.4 FRACTIONS
Notwithstanding anything herein contained, the Trust shall not
be required, upon the exercise or deemed exercise of the Subscription Receipt to
issue fractions of Trust Units. In lieu of fractional Trust Units, there shall
be paid to the holder, within 10 Business Days after surrender of the
Subscription Certificate, an amount in lawful money of Canada equal to the then
current market value of such fractional interest computed on the basis of the
Current Market Price on the Acquisition Date.
3.5 PAYMENT ON TERMINATION
(a) If the Acquisition is terminated, the Trust advises the
Underwriters or announces to the public that it does not intend to proceed with
the Acquisition or the Acquisition Time does not occur, in any such case, by the
Deadline, the Trust shall forthwith notify the Subscription Receipt Agent
thereof and shall issue a press release setting forth the Termination Date.
(b) If the Acquisition is terminated, the Trust advises the
Underwriters or announces to the public that it does not intend to proceed with
the Acquisition or the Acquisition Time does not occur, in any such case, by the
Deadline, the subscription evidenced by each Subscription Receipt shall be
automatically terminated and cancelled and each Receiptholder (or a transferee
thereof if all applicable transfer requirements, other than registration, have
been satisfied) shall be entitled from and after the Termination Payment Time,
but shall receive no earlier than on the second Business Day following the
Termination Date, a cheque in the aggregate amount of (i) the Subscription Price
in respect of each of such holder's Subscription Receipts; and (ii) such
holder's PRO RATA share of the Earned Interest less applicable withholding
taxes; by surrendering, at any time after the Termination Date, to the
Subscription Receipt Agent at the Designated Office the applicable Subscription
Receipt Certificate. The amount paid to each Receiptholder under (i) shall be
satisfied by the Escrowed Funds and the amount in (ii), if any, shall be
satisfied by the Earned Interest. If the Escrowed Funds are not satisfactory to
meet the payment required by Section 3.5(b)(ii), the Subscription Receipt Agent
shall only make payments under this section to the extent monies have been
deposited with it pursuant to Section 3.7.
(c) If the Acquisition Time does not occur by the Deadline,
registers shall be closed at the close of business on the Termination Date.
(d) A Surrender Form submitted upon surrender of a Subscription
Receipt Certificate as contemplated in Section 3.5(b) shall be signed by the
Receiptholder (or a transferee thereof if all applicable transfer requirements,
other than registration, have been satisfied) and shall specify the name and
address of the person to whom the amount specified in Section 3.5(b) shall be
paid.
(e) The obligation to make the payment of the amount specified in
Section 3.5(b) shall be satisfied by:
(i) mailing payment by cheque payable at par in Calgary,
Alberta and to the payee specified in the Surrender Form and at the
address specified for such payee in the Surrender Form; or
(ii) if so requested by the person surrendering the
relevant Subscription Receipt Certificate, actual delivery of a cheque
payable at par in Calgary, Alberta to the payee specified in the
Surrender Form at the Designated Office where the Subscription Receipt
was surrendered.
The mailing or delivering of such cheque shall occur as soon as
practicable following the surrender of the Subscription Receipt
Certificate.
(f) If any Subscription Receipts Certificates have not been
surrendered as contemplated in Section 3.5(b) by December 30, 2005, or any
earlier time after the Termination Date at the election of the Trust, the
Subscription Receipt Agent shall mail the cheques in payment of the amount
specified in Section 3.5(b) to the holders of such Subscription Receipts at
their last addresses of record.
(g) Upon the mailing or delivery of any cheque as provided in
Sections 3.5(d) and (e) (and provided such cheque has been honoured for payment,
if presented for payment within six months of the date thereof) all rights
evidenced by the Subscription Receipts relating thereto shall be satisfied and
such Subscription Receipts shall be void and of no value or effect. For greater
certainty, any Escrowed Funds, interest or other monies held by the Subscription
Receipt Agent pursuant hereto after the cheque or cheques for the amount
specified in Sections 3.5(d) and (e) have been mailed or delivered, as the case
may be, shall be delivered to the Trust as soon as reasonably practicable
thereafter.
3.6 CANCELLATION OF SURRENDERED SUBSCRIPTION RECEIPT CERTIFICATES
All Subscription Receipt Certificates surrendered to the
Subscription Receipt Agent pursuant to Sections 2.10, 2.11, 3.5 and 5.1 shall be
returned to or received by the Subscription Receipt Agent for cancellation and,
if required by the Trust, the Subscription Receipt Agent shall furnish the Trust
with a cancellation certificate identifying the Subscription Receipt
Certificates so cancelled and the number of Subscription Receipts evidenced
thereby.
3.7 ADDITIONAL PAYMENTS BY THE TRUST
The Trust shall, no later than one (1) Business Day before the
date upon which the Acquisition Payment is required to be paid pursuant to
Article 3, pay to the Subscription Receipt Agent such amount, if any, as will be
sufficient to allow the Subscription Receipt Agent to pay in full the
Acquisition Payment as is required under the circumstances.
ARTICLE 4
INVESTMENT OF PROCEEDS
AND PAYMENT OF INTEREST
4.1 INVESTMENT OF PROCEEDS
Pending disbursement of the Escrowed Funds, the Subscription
Receipt Agent shall hold, invest and reinvest the Proceeds on behalf of the
Receiptholders in short-term obligations of, or guaranteed by, the Government of
Canada, corporate commercial paper which is rated R1 (middle), investment
certificates of a Canadian chartered bank and other approved investments as
directed in writing by the Trust. If at any time the Proceeds include cash that
is not invested and the Trust has not provided directions to the Subscription
Receipt Agent to invest such cash, the Subscription Receipt Agent shall deposit
all such uninvested cash in an account, a term deposit or guaranteed investment
certificates of the Subscription Receipt Agent or a Canadian chartered bank,
having either no fixed term or no irrevocable term and which pays interest on
the daily balance.
4.2 SEGREGATION OF PROCEEDS
The Escrowed Funds received by the Subscription Receipt Agent
and any securities or other instruments received by the Subscription Receipt
Agent upon the investment or reinvestment of such Escrowed Funds, shall be
received as agent for, and shall be segregated and kept apart by the
Subscription Receipt Agent as agent for, the Receiptholders and the
Underwriters.
ARTICLE 5
RIGHTS OF THE TRUST AND COVENANTS
5.1 OPTIONAL PURCHASES BY THE TRUST
Subject to applicable law, the Trust may from time to time
purchase by private contract or otherwise any of the Subscription Receipts.
5.2 GENERAL COVENANTS
(a) The Trust covenants with the Subscription Receipt Agent and
the Lead Underwriter, on behalf of the Underwriters, that so long as any
Subscription Receipts remain outstanding:
(i) it will use its best efforts to maintain its
existence;
(ii) it will make all requisite filings under applicable
Canadian securities legislation including those necessary to remain a
reporting issuer not in default in each of the Provinces of Canada in
which it is presently a reporting issuer;
(iii) it will announce by press release the occurrence of
the Acquisition Date or the Termination Date, as the case may be, in
accordance with Section 3.1 or Section 3.5(a), as the case may be;
(iv) generally, it will well and truly perform and carry
out all of the acts or things to be done by it as provided in this
Agreement;
(v) prior to the earlier of the Acquisition Date and the
Termination Date, it will not sell the properties or assets of the
Trust as, or substantially as, an entirety, to any other entity;
(vi) it will reserve and keep available a sufficient
number of Trust Units for the purpose of enabling it to satisfy its
obligations to issue Trust Units pursuant to the Subscription Receipts;
(vii) it will cause the Trust Units and the certificates
representing the Trust Units from time to time acquired pursuant to the
Subscription Receipts to be duly issued and delivered in accordance
with the Subscription Receipts and the terms hereof; and
(viii) it will use its best efforts to ensure that (until
the earlier of the Issue Date and the Termination Date) the
Subscription Receipts and the Trust Units continue to be or are listed
and posted for trading on the Toronto Stock Exchange.
(b) In addition, the Trust covenants with the Subscription Receipt
Agent and the Lead Underwriter, on behalf of the Underwriters, that, from the
date hereof to the earlier of the Termination Date and the Acquisition Date, it
will not do any of the following:
(i) subdivide or redivide the outstanding Trust Units
into a greater number of units;
(ii) reduce, combine or consolidate the outstanding Trust
Units into a smaller number of units;
(iii) issue Trust Units to holders of all or substantially
all of the outstanding Trust Units by way of a dividend or distribution
(other than the issue of Trust Units to holders of Trust Units who have
elected to receive dividends or distributions in the form of Trust
Units in lieu of cash dividends or cash distributions paid in the
ordinary course on the Trust Units);
(iv) fix a record date for the making of a distribution to
all or substantially all the holders of its outstanding Trust Units of
(i) units of any class other than Trust Units and other than units
distributed to holders of Trust Units who have elected to receive
dividends or distributions in the form of such units in lieu of
dividends or distributions paid in the ordinary course, or (ii) rights,
options or warrants; or
(v) reclassify the Trust Units or undertake a
reorganization of the Trust or a consolidation, amalgamation,
arrangement or merger of the Trust with any other Person or other
entity; or a sale or conveyance of the property and assets of the Trust
as an entity or substantially as an entirety to any other Person or
entity or a liquidation, dissolution or winding-up of the Trust.
SUBSCRIPTION RECEIPT AGENT'S REMUNERATION, EXPENSES AND INDEMNIFICATION
(a) The Trust covenants that it will pay to the Subscription
Receipt Agent from time to time reasonable remuneration for its services
hereunder and will pay or reimburse the Subscription Receipt Agent upon its
request for all reasonable expenses, disbursements and advances incurred or made
by the Subscription Receipt Agent in the administration or execution of this
Agreement (including the reasonable compensation and the disbursements of its
counsel and all other advisers and assistants not regularly in its employ) both
before any default hereunder and thereafter until all duties of the Subscription
Receipt Agent hereunder shall be finally and fully performed, except any such
expense, disbursement or advance as may arise out of or result from the
Subscription Receipt Agent's negligence, wilful misconduct or bad faith. Any
amount owing hereunder and remaining unpaid after 30 days from the invoice date
will bear interest at the then current rate charged by the Subscription Receipt
Agent against unpaid invoices and shall be payable on demand.
(b) The Trust herebyindemnifies and saves harmless the
Subscription Receipt Agent and its shareholders, officers, directors, employees
and agents from and against any and all liabilities, losses, costs, claims,
actions or demands whatsoever which may be brought against the Subscription
Receipt Agent or which it may suffer or incur as a result or arising out of or
in connection with the performance of its duties and obligations or the exercise
of its rights and authority under this Agreement, including, without limitation,
legal fees and disbursements and costs and expenses incurred in connection with
the enforcement of the indemnity, save only in the event of the negligence,
wilful misconduct or bad faith of the Subscription Receipt Agent. It is
understood and agreed that this indemnification shall survive the termination or
the discharge of this Agreement or the resignation or replacement of the
Subscription Receipt Agent.
5.4 PERFORMANCE OF COVENANTS BY SUBSCRIPTION RECEIPT AGENT
If the Trust shall fail to perform any of its covenants
contained in this Agreement, the Subscription Receipt Agent may notify the
Receiptholders and the Lead Underwriter, on behalf of the Underwriters, of such
failure on the part of the Trust or may itself perform any of the said covenants
capable of being performed by it, but shall be under no obligation to perform
said covenants or to notify the Receiptholders of such performance by it. All
sums expended or advanced by the Subscription Receipt Agent in so doing shall be
repayable as provided in Section 5.3. No such performance, expenditure or
advance by the Subscription Receipt Agent shall relieve the Trust of any default
hereunder or of its continuing obligations under the covenants contained herein.
5.5 ACCOUNTING
The Subscription Receipt Agent shall maintain accurate books,
records and accounts of the transactions effected or controlled by the
Subscription Receipt Agent hereunder and the receipt, investment, reinvestment
and disbursement of the Proceeds, and shall provide to the Trust and the
Underwriters records and statements thereof periodically upon written request.
The Trust shall have the right to audit any such books, records, accounts and
statements.
5.6 PAYMENTS BY SUBSCRIPTION RECEIPT AGENT
In the event that any funds to be disbursed by the
Subscription Receipt Agent in accordance herewith are received by the
Subscription Receipt Agent in the form of an uncertified cheque or cheques, the
Subscription Receipt Agent shall be entitled to delay the time for disbursement
of such funds hereunder until such uncertified cheque or cheques have cleared in
the ordinary course of the financial institution upon which the same are drawn.
The Subscription Receipt Agent will disburse monies according to this Agreement
only to the extent that monies have been deposited with it.
5.7 REGULATORY MATTERS
The Trust shall file all such documents, notices and
certificates and take such steps and do such things as may be necessary under
applicable securities laws to permit the issuance of the Trust Units in the
circumstances contemplated by Section 3.3 such that (i) such issuance will
comply with the prospectus and registration requirements of applicable
securities laws and (ii) the first trade in Trust Units will not be subject to,
or will be exempt from, the prospectus requirements of applicable securities
laws.
ARTICLE 6
ENFORCEMENT
6.1 SUITS BY RECEIPTHOLDERS
All or any of the rights conferred upon any Receiptholder by
any of the terms of the Subscription Receipt Certificates or of this Agreement,
or of both, may be enforced by the Receiptholder by appropriate proceedings but
without prejudice to the right which is hereby conferred upon the Subscription
Receipt Agent to proceed in its own name to enforce each and all of the
provisions contained herein for the benefit of the Receiptholders.
6.2 IMMUNITY OF UNITHOLDERS, ETC.
The Subscription Receipt Agent and, by the acceptance of the
Subscription Receipt Certificates and as part of the consideration for the issue
of the Subscription Receipts, the Receiptholders hereby waive and release any
right, cause of action or remedy now or hereafter existing in any jurisdiction
against any settlor or any past, present or future Unitholder, Trustee, officer,
employee or agent of the Trust or any successor entity for the issue of the
Trust Units pursuant to any Subscription Receipt or on any covenant, agreement,
representation or warranty by the Trust contained herein or in the Subscription
Receipt Certificate(s) .
6.3 LIMITATION OF LIABILITY
The obligations hereunder are not personally binding upon, nor
shall resort hereunder be had to, the private property of any of the past,
present or future Trustee(s) or Unitholders of the Trust or any successor entity
or any of the past, present or future officers, employees or agents of the Trust
or of any successor entity, but only the property of the Trust or any successor
entity shall be bound in respect hereof.
ARTICLE 7
MEETINGS OF RECEIPTHOLDERS
7.1 RIGHT TO CONVENE MEETINGS
The Subscription Receipt Agent may at any time and from time
to time, and shall on receipt of a written request of the Trust or of a
Receiptholders' Request and upon being indemnified to its reasonable
satisfaction by the Trust or by the Receiptholders signing such Receiptholders'
Request against the cost which may be incurred in connection with the calling
and holding of such meeting, convene a meeting of the Receiptholders. In the
event of the Subscription Receipt Agent failing to so convene a meeting within
ten (10) days after receipt of such written request of the Trust or such
Receiptholders' Request and indemnity given as aforesaid, the Trust or such
Receiptholders, as the case may be, may convene such meeting. Every such meeting
shall be held in the City of Calgary or at such other place as may be determined
by the Subscription Receipt Agent and approved by the Trust.
7.2 NOTICE
At least ten (10) days prior notice of any meeting of
Receiptholders shall be given to the Receiptholders in the manner provided for
in Section 10.2 and a copy of such notice shall be sent by mail to the
Subscription Receipt Agent (unless the meeting has been called by the
Subscription Receipt Agent) and to the Trust (unless the meeting has been called
by the Trust). Such notice shall state the date (which should be a Business Day)
and time when, and the place where the meeting, is to be held, shall state
briefly the general nature of the business to be transacted thereat and shall
contain such information as is reasonably necessary to enable the Receiptholders
to make a reasoned decision on the matter, but it shall not be necessary for any
such notice to set out the terms of any resolution to be proposed or any of the
provisions of this Article 7.
7.3 CHAIRMAN
An individual (who need not be a Receiptholder) designated in
writing by the Subscription Receipt Agent shall be chairman of the meeting and
if no individual is so designated, or if the individual so designated is not
present within fifteen (15) minutes from the time fixed for the holding of the
meeting, the Receiptholders present in person or by proxy shall choose some
individual present to be chairman.
7.4 QUORUM
Subject to the provisions of Section 7.11, at any meeting of
the Receiptholders a quorum shall consist of not less than two (2)
Receiptholders present in person or by proxy and holding 10% of the then
outstanding Subscription Receipts. If a quorum of the Receiptholders shall not
be present within thirty (30) minutes from the time fixed for holding any
meeting, the meeting, if summoned by the Receiptholders or on a Receiptholders'
Request, shall be dissolved; but in any other case the meeting shall be
adjourned to the same day in the next week (unless such day is not a Business
Day, in which case it shall be adjourned to the next following Business Day) at
the same time and place and no notice of the adjournment need be given. Any
business may be brought before or dealt with at an adjourned meeting which might
have been dealt with at the original meeting in accordance with the notice
calling the same. No business shall be transacted at any meeting unless a quorum
be present at the commencement of business. At the adjourned meeting the
Receiptholders present in person or by proxy shall form a quorum and may
transact the business for which the meeting was originally convened
notwithstanding that they may not hold at least 10% of the then outstanding
Subscription Receipts.
7.5 POWER TO ADJOURN
The chairman of any meeting at which a quorum of the
Receiptholders is present may, with the consent of the meeting, adjourn any such
meeting and no notice of such adjournment need be given except such notice, if
any, as the meeting may prescribe.
7.6 SHOW OF HANDS
Every question submitted to a meeting shall be decided in the
first place by a majority of the votes given on a show of hands except that
votes on an extraordinary resolution shall be given in the manner hereinafter
provided. At any such meeting, unless a poll is duly demanded as herein
provided, a declaration by the chairman that a resolution has been carried or
carried unanimously or by a particular majority or lost or not carried by a
particular majority shall be conclusive evidence of the fact.
7.7 POLL AND VOTING
On every extraordinary resolution, and on any other question
submitted to a meeting and after a vote by show of hands when demanded by the
chairman or by one or more of the Receiptholders acting in person or by proxy
and holding at least 5% of the then outstanding Subscription Receipts, a poll
shall be taken in such manner as the chairman shall direct. Questions other than
those required to be determined by extraordinary resolution shall be decided by
a majority of the votes cast on the poll.
On a show of hands, every person who is present and entitled
to vote, whether as a Receiptholder or as proxy for one or more absent
Receiptholders, or both, shall have one vote. On a poll, each Receiptholder
present in person or represented by a proxy duly appointed by instrument in
writing shall be entitled to one vote in respect of each Unit he is entitled to
receive pursuant to the Subscription Receipt(s) then held or represented by him.
A proxy need not be a Receiptholder. In the case of joint holders, any of them
present in person or by proxy at the meeting may vote in the absence of the
other or others; but in case more than one of them shall be present in person or
by proxy, they shall vote together in respect of Subscription Receipts of which
they are joint registered holders. The chairman of any meeting shall be
entitled, both on a show of hands and on a poll, to vote in respect of the
Subscription Receipts, if any, held or represented by him.
REGULATIONS
The Subscription Receipt Agent, or the Trust with the approval
of the Subscription Receipt Agent, may from time to time make and from time to
time vary such regulations as it shall think fit for:
(a) the setting of the record date for a meeting of holders of
Subscription Receipts for the purpose of determining Receiptholders entitled to
receive notice of and vote at such meeting;
(b) the issue of voting certificates by any bank, trust company or
other depositary satisfactory to the Subscription Receipt Agent stating that the
Subscription Receipt Certificates specified therein have been deposited with it
by a named person and will remain on deposit until after the meeting, which
voting certificate shall entitle the persons named therein to be present and
vote at any such meeting and at any adjournment thereof or to appoint a proxy or
proxies to represent them and vote for them at any such meeting and at any
adjournment thereof in the same manner and with the same effect as though the
persons so named in such voting certificates were the actual holders of the
Subscription Receipt Certificates specified therein;
(c) the deposit of voting certificates and instruments appointing
proxies at such place and time as the Subscription Receipt Agent, the Trust or
the Receiptholders, convening the meeting, as the case may be, may in the notice
convening the meeting direct;
(d) the deposit of voting certificates and instruments appointing
proxies at some approved place or places other than the place at which the
meeting is to be held and enabling particulars of such instruments appointing
proxies to be mailed or telecopied before the meeting to the Trust or to the
Subscription Receipt Agent at the place where the same is to be held and for the
voting of proxies so deposited as though the instruments themselves were
produced at the meeting;
(e) the form of the instrument of proxy; and
(f) generally for the calling of meetings of Receiptholders and
the conduct of business thereat.
Any regulations so made shall be binding and effective and the
votes given in accordance therewith shall be valid and shall be counted. Save as
such regulations may provide, the only persons who shall be recognized at any
meeting as a Receiptholder, or be entitled to vote or be present at the meeting
in respect thereof (subject to Section 7.9), shall be Receiptholders or their
counsel, or proxies of Receiptholders.
7.9 TRUST AND SUBSCRIPTION RECEIPT AGENT MAY BE REPRESENTED
The Trust and the Subscription Receipt Agent, by their
respective authorized agents, and the counsel for the Trust and for the
Subscription Receipt Agent may attend any meeting of the Receiptholders, but
shall have no vote as such unless in their capacity as Receiptholder or a proxy
holder.
7.10 POWERS EXERCISABLE BY EXTRAORDINARY RESOLUTION
In addition to all other powers conferred upon them by any
other provisions of this Agreement or by law, the Receiptholders at a meeting
shall, subject to the provisions of Section 7.11, have the power, subject to all
applicable regulatory and exchange approvals, exercisable from time to time by
extraordinary resolution:
(a) to agree to any modification, abrogation, alteration,
compromise or arrangement of the rights of Receiptholders or the Subscription
Receipt Agent against the Trust or against its undertaking, property and assets
or any part thereof whether such rights arise under this Agreement or the
Subscription Receipt Certificates or otherwise;
(b) to amend, alter or repeal any extraordinary resolution
previously passed or sanctioned by the Receiptholders;
(c) to direct or to authorize the Subscription Receipt Agent to
enforce any of the covenants on the part of the Trust contained in this
Agreement or the Subscription Receipt Certificates or to enforce any of the
rights of the Receiptholders in any manner specified in such extraordinary
resolution or to refrain from enforcing any such covenant or right;
(d) to waive, and to direct the Subscription Receipt Agent to
waive, any default on the part of the Trust in complying with any provisions of
this Agreement or the Subscription Receipt Certificates either unconditionally
or upon any conditions specified in such extraordinary resolution;
(e) to restrain any Receiptholder from taking or instituting any
suit, action or proceeding against the Trust for the enforcement of any of the
covenants on the part of the Trust in this Agreement or the Subscription Receipt
Certificates or to enforce any of the rights of the Receiptholders;
(f) to direct any Receiptholder who, as such, has brought any
suit, action or proceeding to stay or to discontinue or otherwise to deal with
the same upon payment of the costs, charges and expenses reasonably and properly
incurred by such Receiptholder in connection therewith;
(g) to assent to any modification of, change in or omission from
the provisions contained in the Subscription Receipt Certificates and this
Agreement or any ancillary or supplemental instrument which may be agreed to by
the Trust, and to authorize the Subscription Receipt Agent to concur in and
execute any ancillary or supplemental agreement embodying the change or
omission;
(h) with the consent of the Trust (such consent not to be
unreasonably withheld), to remove the Subscription Receipt Agent or its
successor in office and to appoint a new Subscription Receipt Agent to take the
place of the Subscription Receipt Agent so removed;
(i) to assent to any compromise or arrangement with any creditor
or creditors or any class or classes of creditors, whether secured or otherwise,
and with holders of any Trust Units or other securities of the Trust; and
(j) to assent to any modification of the Trust Indenture in
circumstances where, had the Trust Units then been outstanding, an extraordinary
resolution of the holders of Trust Units would have been required.
7.11 MEANING OF EXTRAORDINARY RESOLUTION
(a) The expression "extraordinary resolution" when used in this
Agreement means, subject as hereinafter provided in this Section 7.11 and in
Section 7.14, a resolution proposed at a meeting of Receiptholders duly convened
for that purpose and held in accordance with the provisions of this Article 7 at
which there are present in person or by proxy at least two (2) Receiptholders
holding more than 10% of the then outstanding Subscription Receipts and passed
by the affirmative votes of Receiptholders holding not less than 66 2/3% of the
then outstanding Subscription Receipts represented at the meeting and voted on
the poll upon such resolution.
(b) If, at any meeting called for the purpose of passing an
extraordinary resolution, at least two (2) Receiptholders holding more than 10%
of the then outstanding Subscription Receipts are not present in person or by
proxy within thirty (30) minutes after the time appointed for the meeting, then
the meeting, if convened by Receiptholders or on a Receiptholders' Request,
shall be dissolved; but in any other case it shall stand adjourned to such day,
being not less than fourteen (14) or more than thirty (30) days later, and to
such place and time as may be appointed by the chairman. Not less than seven (7)
days prior notice shall be given of the time and place of such adjourned meeting
in the manner provided for in Section 10.2. Such notice shall state that at the
adjourned meeting the Receiptholders present in person or by proxy shall form a
quorum but it shall not be necessary to set forth the purposes for which the
meeting was originally called or any other particulars. At the adjourned
meeting:
(i) if the extraordinary resolution purports to exercise
any of the powers conferred pursuant to Subsection 7.10 (a), (d), (i)
or (j) or purports to change the provisions of this Section 7.11 or of
Section 7.14 or purports to amend, alter or repeal any extraordinary
resolution previously passed or sanctioned by the Receiptholders in
exercise of the powers referred to in this paragraph, a quorum for the
transaction of business shall consist of Receiptholders holding more
than 25% of the then outstanding Subscription Receipts present in
person or by proxy; and
(ii) in any other case, a quorum for the transaction of
business shall consist of such Receiptholders as are present in person
or by proxy.
(c) At any such adjourned meeting, any resolution passed by the
requisite votes as provided in Subsection 7.11(a) shall be an extraordinary
resolution within the meaning of this Agreement notwithstanding that
Receiptholders holding more than 50% of the then outstanding Subscription
Receipts are not present in person or by proxy at such adjourned meeting.
(d) Votes on an extraordinary resolution shall always be given on
a poll and no demand for a poll on an extraordinary resolution shall be
necessary.
7.12 POWERS CUMULATIVE
Any one or more of the powers or any combination of the powers
in this Agreement stated to be exercisable by the Receiptholders by
extraordinary resolution or otherwise may be exercised from time to time and the
exercise of any one or more of such powers or any combination of powers from
time to time shall not be deemed to exhaust the right of the Receiptholders to
exercise such power or powers or combination of powers then or thereafter from
time to time.
7.13 MINUTES
Minutes of all resolutions and proceedings at every meeting of
Receiptholders shall be made and duly entered in books to be provided from time
to time for that purpose by the Subscription Receipt Agent at the expense of the
Trust, and any such minutes as aforesaid, if signed by the chairman or the
secretary of the meeting at which such resolutions were passed or proceedings
had or by the chairman or secretary of the next succeeding meeting held shall be
prima facie evidence of the matters therein stated and, until the contrary is
proved, every such meeting in respect of the proceedings of which minutes shall
have been made shall be deemed to have been duly convened and held, and all
resolutions passed thereat or proceedings taken shall be deemed to have been
duly passed and taken.
7.14 INSTRUMENTS IN WRITING
All actions which may be taken and all powers that may be
exercised by the Receiptholders at a meeting held as provided in this Article 7
may also be taken and exercised by an instrument in writing signed in one or
more counterparts by such Receiptholders in person or by attorney duly appointed
in writing, by Receiptholders holding at least 66 2/3% of then outstanding
Subscription Receipts with respect to an extraordinary resolution, and the
expression "extraordinary resolution" when used in this Agreement shall include
an instrument so signed by Receiptholders holding at least 66 2/3% of the then
outstanding Subscription Receipts.
7.15 BINDING EFFECT OF RESOLUTIONS
Every resolution and every extraordinary resolution passed in
accordance with the provisions of this Article 7 at a meeting of Receiptholders
shall be binding upon all the Receiptholders, whether present at or absent from
such meeting, and every instrument in writing signed by Receiptholders in
accordance with Section 7.14 shall be binding upon all the Receiptholders,
whether signatories thereto or not, and each and every Receiptholder and the
Subscription Receipt Agent (subject to the provisions for indemnity herein
contained and subject to applicable law) shall be bound to give effect
accordingly to every such resolution and instrument in writing.
7.16 HOLDINGS BY TRUST DISREGARDED
In determining whether Receiptholders holding the required
number of Subscription Receipts are present at a meeting of Receiptholders for
the purpose of determining a quorum or have concurred in any consent, waiver,
extraordinary resolution, Receiptholders' Request or other action under this
Agreement, Subscription Receipts owned legally or beneficially by the Trust or
any affiliated entity of the Trust shall be disregarded in accordance with the
provisions of Section 10.7.
ARTICLE 8
SUPPLEMENTAL AGREEMENTS
8.1 PROVISION FOR SUPPLEMENTAL AGREEMENTS FOR CERTAIN PURPOSES
From time to time the Trust (when authorized by action by the
Trustee), the Lead Underwriter, on behalf of the Underwriters, and the
Subscription Receipt Agent may, subject to the provisions hereof, and they
shall, when so directed in accordance with the provisions hereof, execute and
deliver by their proper officers, agreements supplemental hereto, which
thereafter shall form part hereof, for any one or more or all of the following
purposes:
(a) adding to the provisions hereof such additional covenants and
enforcement provisions as, in the opinion of Counsel, are necessary or advisable
in the premises, provided that the same are not in the opinion of the
Subscription Receipt Agent prejudicial to the interests of the Receiptholders;
(b) giving effect to any extraordinary resolution passed as
provided in Article 7;
(c) making such provisions not inconsistent with this Agreement as
may be necessary or desirable with respect to matters or questions arising
hereunder, provided that such provisions are not, in the opinion of the
Subscription Receipt Agent, prejudicial to the interests of the Receiptholders;
(d) adding to or altering the provisions hereof in respect of the
transfer of Subscription Receipts, making provision for the exchange of
Subscription Receipt Certificates, and making any modification in the form of
the Subscription Receipt Certificates which does not affect the substance
thereof;
(e) modifying any of the provisions of this Agreement, including
relieving the Trust from any of the obligations, conditions or restrictions
herein contained, provided that such modification or relief shall be or become
operative or effective only if, in the opinion of the Subscription Receipt
Agent, such modification or relief in no way prejudices any of the rights of the
Receiptholders or of the Subscription Receipt Agent, and provided further that
the Subscription Receipt Agent may in its sole discretion decline to enter into
any such supplemental agreement which in its opinion may not afford adequate
protection to the Subscription Receipt Agent when the same shall become
operative; and
(f) for any other purpose not inconsistent with the terms of this
Agreement, including the correction or rectification of any ambiguities,
defective or inconsistent provisions, errors, mistakes or omissions herein,
provided that in the opinion of the Subscription Receipt Agent the rights of the
Subscription Receipt Agent and of the Receiptholders are in no way prejudiced
thereby.
ARTICLE 9
CONCERNING THE SUBSCRIPTION RECEIPT AGENT
RIGHTS AND DUTIES OF SUBSCRIPTION RECEIPT AGENT
(a) In the exercise of the rights and duties prescribed or
conferred by the terms of this Agreement, the Subscription Receipt Agent shall
exercise that degree of care, diligence and skill that a reasonably prudent
Subscription Receipt Agent would exercise in comparable circumstances. No
provision of this Agreement shall be construed to relieve the Subscription
Receipt Agent from liability for its own negligent action, its own negligent
failure to act, or its own negligence, wilful misconduct or bad faith.
(b) The obligation of the Subscription Receipt Agent to commence
or continue any act, action or proceeding for the purpose of enforcing any
rights of the Subscription Receipt Agent or the Receiptholders hereunder shall
be conditional upon the Receiptholders furnishing, when required by notice by
the Subscription Receipt Agent, sufficient funds to commence or to continue such
act, action or proceeding and an indemnity reasonably satisfactory to the
Subscription Receipt Agent to protect and to hold harmless the Subscription
Receipt Agent against the costs, charges and expenses and liabilities to be
incurred thereby and any loss and damage it may suffer by reason thereof. None
of the provisions contained in this Agreement shall require the Subscription
Receipt Agent to expend or to risk its own funds or otherwise to incur financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers unless indemnified as aforesaid.
(c) The Subscription Receipt Agent may, before commencing or at
any time during the continuance of any such act, action or proceeding, require
the Receiptholders at whose instance it is acting to deposit with the
Subscription Receipt Agent the Subscription Receipts held by them, for which
Subscription Receipts the Subscription Receipt Agent shall issue receipts.
(d) Every provision of this Agreement that by its terms relieves
the Subscription Receipt Agent of liability or entitles it to rely upon any
evidence submitted to it is subject to the provisions of this Section 9.1 and of
Section 9.2.
(e) The Subscription Receipt Agent shall have no duties except
those expressly set forth herein, and it shall not be bound by any notice of a
claim or demand with respect to, or any waiver, modification, amendment,
termination or rescission of, this Agreement, unless received by it in writing
and signed by the other parties hereto and, if its rights or duties herein are
affected, unless it shall have given its prior written consent thereto.
(f) The Subscription Receipt Agent shall not be responsible for
ensuring that the Proceeds are used in the manner contemplated by the
Prospectus.
(g) The Subscription Receipt Agent shall retain the right not to
act and shall not be held liable for refusing to act unless it has received
clear and reasonable documentation which complies with the terms of this
Agreement, which documentation does not require the exercise of any discretion
or independent judgment.
(h) The Subscription Receipt Agent shall incur no liability
whatsoever with respect to the delivery or non-delivery of any certificates
whether delivery by hand, mail or any other means.
(i) The Subscription Receipt Agent shall not be responsible or
liable in any manner whatsoever for the deficiency, correctness, genuineness or
validity of any securities deposited with it.
EVIDENCE, EXPERTS AND ADVISERS
(a) In addition to the reports, certificates, opinions and other
evidence required by this Agreement, the Trust shall furnish to the Subscription
Receipt Agent such additional evidence of compliance with any provision hereof,
and in such form, as the Subscription Receipt Agent may reasonably require by
written notice to the Trust.
(b) In the exercise of its rights and duties hereunder, the
Subscription Receipt Agent may, if it is acting in good faith, rely as to the
truth of the statements and the accuracy of the opinions expressed in statutory
declarations, opinions, reports, written requests, consents, or orders of the
Trust, certificates of the Trust or other evidence furnished to the Subscription
Receipt Agent pursuant to any provision hereof or pursuant to a request of the
Subscription Receipt Agent.
(c) Whenever it is provided in this Agreement that the Trust shall
deposit with the Subscription Receipt Agent resolutions, certificates, reports,
opinions, requests, orders or other documents, it is intended that the truth,
accuracy and good faith on the effective date thereof and the facts and opinions
stated in all such documents so deposited shall, in each and every such case, be
conditions precedent to the right of the Trust to have the Subscription
Receipt Agent take the action to be based thereon.
(d) Proof of the execution of an instrument in writing, including
a Receiptholders' Request, by any Receiptholder may be made by the certificate
of a notary public, or other officer with similar powers, that the person
signing such instrument acknowledged to the officer the execution thereof, or by
an affidavit of a witness to such execution or in any other manner which the
Subscription Receipt Agent may consider adequate.
(e) The Subscription Receipt Agent may employ or retain such
Counsel, accountants, appraisers or other experts or advisers as it may
reasonably require for the purpose of discharging its duties hereunder and may
pay reasonable remuneration for all services so performed by any of them,
without taxation of costs of any Counsel, and shall not be responsible for any
misconduct or negligence on the part of any such experts or advisers who have
been appointed with due care by the Subscription Receipt Agent.
9.3 DOCUMENTS, MONIES, ETC. HELD BY SUBSCRIPTION RECEIPT AGENT
Any securities, documents of title or other instruments that
may at any time be held by the Subscription Receipt Agent pursuant to this
Agreement may be placed in the deposit vaults of the Subscription Receipt Agent
or of any Canadian chartered bank or deposited for safekeeping with any such
bank. If the Subscription Receipt Agent has not received a direction under
Section 4.1, any monies so held pending the application or withdrawal thereof
under any provisions of this Agreement may be deposited in the name of the
Subscription Receipt Agent in any Canadian chartered bank, or in the deposit
department of the Subscription Receipt Agent or any other loan or trust company
authorized to accept deposits under the laws of Canada or a province thereof, at
the rate of interest (if any) then current on similar deposits.
9.4 ACTIONS BY SUBSCRIPTION RECEIPT AGENT TO PROTECT INTEREST
The Subscription Receipt Agent shall have power to institute
and to maintain such actions and proceedings as it may consider necessary or
expedient to preserve, protect or enforce its interests and the interests of the
Receiptholders.
9.5 SUBSCRIPTION RECEIPT AGENT NOT REQUIRED TO GIVE SECURITY
The Subscription Receipt Agent shall not be required to give
any bond or security in respect of the execution of this Agreement or otherwise
in respect of the premises.
9.6 PROTECTION OF SUBSCRIPTION RECEIPT AGENT
By way of supplement to the provisions of any law for the time
being relating to trustees it is expressly declared and agreed as follows:
(a) the Subscription Receipt Agent shall not be liable for or by
reason of any statements of fact or recitals in this Agreement or in the
Subscription Receipt Certificates (except the representation contained in
Section 9.8 or in the certificate of the Subscription Receipt Agent on the
Subscription Receipt Certificates) or be required to verify the same, but all
such statements or recitals are and shall be deemed to be made by the Trust;
(b) nothing herein contained shall impose any obligation on the
Subscription Receipt Agent to see to or to require evidence of the registration
or filing (or renewal thereof) of this Agreement or any instrument ancillary or
supplemental hereto;
(c) the Subscription Receipt Agent shall not be bound to give
notice to any person or persons of the execution hereof; and
(d) the Subscription Receipt Agent shall not incur any liability
or responsibility whatever or be in any way responsible for the consequence of
any breach on the part of the Trust of any of the covenants herein contained or
of any acts of any Trustee, officers, employees, agents or servants of the
Trust.
REPLACEMENT OF SUBSCRIPTION RECEIPT AGENT; SUCCESSOR BY MERGER
(a) The Subscription Receipt Agent may resign its appointment and
be discharged from all other duties and liabilities hereunder, subject to this
Section 9.7, by giving to the Trust not less than thirty (30) days prior notice
in writing or such shorter prior notice as the Trust may accept as sufficient.
The Receiptholders by extraordinary resolution shall have power at any time to
remove the existing Subscription Receipt Agent and to appoint a new subscription
receipt agent. In the event of the Subscription Receipt Agent resigning or being
removed as aforesaid or being dissolved, becoming bankrupt, going into
liquidation or otherwise becoming incapable of acting hereunder, the Lead
Underwriter, on behalf of the Underwriters, shall forthwith appoint a new
subscription receipt agent unless a new subscription receipt agent has already
been appointed by the Receiptholders; failing such appointment by the Lead
Underwriter, on behalf of the Underwriters, the retiring Subscription Receipt
Agent or any Receiptholder may apply to a justice of the Court of Queen's Bench
(Alberta) on such notice as such justice may direct, for the appointment of a
new subscription receipt agent; but any new subscription receipt agent so
appointed by the Lead Underwriter, on behalf of the Underwriters, or by the
Court shall be subject to removal as aforesaid by the Receiptholders. Any new
subscription receipt agent appointed under any provision of this Section 9.7
shall be a corporation authorized to carry on the business of a trust company in
the Provinces of Alberta and Ontario and, if required by the applicable
legislation for any other provinces, in such other provinces. On any such
appointment the new subscription receipt agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been originally named
herein as Subscription Receipt Agent hereunder. At the request of the Trust or
the new subscription receipt agent, the retiring subscription receipt agent,
upon payment of the amounts, if any, due to it pursuant to Section 5.3, shall
duly assign, transfer and deliver to the new subscription receipt agent all
property and money held and all records kept by the retiring subscription
receipt agent hereunder or in connection herewith.
(b) Upon the appointment of a successor subscription receipt
agent, the Trust shall promptly notify the Receiptholders thereof in the manner
provided for in Article 10.
(c) Any corporation into or with which the Subscription Receipt
Agent may be merged or consolidated or amalgamated, or any corporation resulting
therefrom to which the Subscription Receipt Agent shall be a party, or any
corporation succeeding to the corporate trust business of the Subscription
Receipt Agent shall be the successor to the Subscription Receipt Agent hereunder
without any further act on its part or any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor subscription
receipt agent under Subsection 9.7(a).
(d) Any Subscription Receipt Certificates certified but not
delivered by a predecessor subscription receipt agent may be delivered by the
successor subscription receipt agent in the name of the predecessor or successor
subscription receipt agent.
9.8 CONFLICT OF INTEREST
(a) The Subscription Receipt Agent represents to the Trust and the
Lead Underwriter, on behalf of the Underwriters, that at the time of execution
and delivery hereof no material conflict of interest exists between its role as
a subscription receipt agent hereunder and its role in any other capacity and
agrees that in the event of a material conflict of interest arising hereafter it
will, within thirty (30) days after ascertaining that it has such material
conflict of interest, either eliminate the same or assign its appointment as
subscription receipt agent hereunder to a successor subscription receipt agent
approved by the Trust and meeting the requirements set forth in Subsection
9.7(a). Notwithstanding the foregoing provisions of this Subsection 9.8(a), if
any such material conflict of interest exists or hereafter shall exist, the
validity and enforceability of this Agreement and the Subscription Receipt
Certificates shall not be affected in any manner whatsoever by reason thereof.
(b) Subject to Subsection 9.8(a), the Subscription Receipt Agent,
in its personal or any other capacity, may buy, lend upon and deal in securities
of the Trust and generally may contract and enter into financial transactions
with the Trust or any affiliated entity of the Trust without being liable to
account for any profit made thereby.
9.9 ACCEPTANCE OF APPOINTMENT
The Subscription Receipt Agent hereby accepts the appointment
as Subscription Receipt Agent in this Agreement and agrees to perform its duties
hereunder upon the terms and conditions herein set forth.
9.10 SUBSCRIPTION RECEIPT AGENT NOT TO BE APPOINTED RECEIVER
The Subscription Receipt Agent and any person related to the
subscription receipt agent shall not be appointed a receiver, a receiver and
manager or liquidator of all or any part of the assets or undertaking of the
Trust.
ARTICLE 10
GENERAL
10.1 NOTICE TO THE TRUST, SUBSCRIPTION RECEIPT AGENT AND THE LEAD UNDERWRITER
(a) Unless herein otherwise expressly provided, any notice to be
given hereunder to the Trust, the Underwriters or the Subscription Receipt Agent
shall be deemed to be validly given if delivered by hand courier or if
transmitted by telecopier:
(i) if to the Trust:
c/o Harvest Operations Corp.
2100, 333 - 5th Avenue S.W.
Calgary, AB T2P 0L4
Attention: President
Facsimile: (403) 265-3490
(ii) if to the Lead Underwriter, on behalf of the
Underwriters:
National Bank Financial Inc.
2802, 450 - 1st Street S.W.
Calgary, AB T2P 5H1
Attention: L. Trevor Anderson Facsimile:
(403) 265-0543
(iii) if to the Subscription Receipt Agent:
Valiant Trust Company
310, 606 - 4th Street S.W.
Calgary, AB T2P 1T1
Attention: Manager Income Trust Facsimile:
(403) 233-2857
and any such notice delivered in accordance with the foregoing shall be
deemed to have been received on the date of delivery or, if telecopied
on the day of transmission or, if such day is not a Business Day, on
the first Business Day following the day of transmission.
(b) The Trust, the Lead Underwriter, on behalf of the Underwriters, or the
Subscription Receipt Agent, as the case may be, may from time to time
notify the other in the manner provided in Section 10.1(a) of a change
of address which, from the effective date of such notice and until
changed by like notice, shall be the address of the Trust, the Lead
Underwriter, on behalf of the Underwriters, or the Subscription Receipt
Agent, as the case may be, for all purposes of this Agreement.
NOTICE TO RECEIPTHOLDERS
(a) Any notice to the Receiptholders under the
provisions of this Agreement shall be valid and effective if
delivered or sent by letter or circular through the ordinary
post addressed to such holders at their post office addresses
appearing on the register hereinbefore mentioned and shall be
deemed to have been effectively given on the date of delivery
or, if mailed, five (5) Business Days following actual posting
of the notice.
(b) If, by reason of a strike, lockout or other work stoppage,
actual or threatened, involving postal employees, any notice
to be given to the Receiptholders hereunder could reasonably
be considered unlikely to reach its destination, such notice
shall be valid and effective only if it is delivered
personally to such Receiptholders or if delivered to the
address for such Receiptholders contained in the register of
Subscription Receipts maintained by the Subscription Receipt
Agent.
10.3 OWNERSHIP AND TRANSFER OF SUBSCRIPTION RECEIPTS
The Trust and the Subscription Receipt Agent may deem and
treat the registered owner of any Subscription Receipt Certificate or, in the
case of a transferee who has surrendered a Subscription Receipt Certificate in
accordance with and as contemplated in Section 3.3 or 3.5, such transferee, as
the absolute owner of the Subscription Receipt represented thereby for all
purposes, and the Trust and the Subscription Receipt Agent shall not be affected
by any notice or knowledge to the contrary except where the Trust or the
Subscription Receipt Agent is required to take notice by statute or by order of
a court of competent jurisdiction. A Receiptholder shall be entitled to the
rights evidenced by such Subscription Receipt Certificate free from all equities
or rights of set off or counterclaim between the Trust and the original or any
intermediate holder thereof and all persons may act accordingly and the receipt
of any such Receiptholder for the Trust Units which may be acquired pursuant
thereto shall be a good discharge to the Trust and the Subscription Receipt
Agent for the same and neither the Trust nor the Subscription Receipt Agent
shall be bound to inquire into the title of any such holder except where the
Trust or the Subscription Receipt Agent is required to take notice by statute or
by order of a court of competent jurisdiction.
10.4 EVIDENCE OF OWNERSHIP
(a) Upon receipt of a certificate of any bank, trust company or other
depositary satisfactory to the Subscription Receipt Agent stating that the
Subscription Receipts specified therein have been deposited by a named person
with such bank, trust company or other depositary and will remain so deposited
until the expiry of the period specified therein, the Trust and the Subscription
Receipt Agent may treat the person so named as the owner, and such certificate
as sufficient evidence of the ownership by such person of such Subscription
Receipt during such period, for the purpose of any requisition, direction,
consent, instrument or other document to be made, signed or given by the holder
of the Subscription Receipt so deposited.
(b) The Trust and the Subscription Receipt Agent may accept as
sufficient evidence of the fact and date of the signing of any requisition,
direction, consent, instrument or other document by any person (i) the signature
of any officer of any bank, trust company, or other depositary satisfactory to
the Subscription Receipt Agent as witness of such execution, (ii) the
certificate of any notary public or other officer authorized to take
acknowledgments of deeds to be recorded at the place where such certificate is
made that the person signing acknowledged to him the execution thereof, or (iii)
a statutory declaration of a witness of such execution.
10.5 SATISFACTION AND DISCHARGE OF AGREEMENT
Upon the earliest of:
(a) the date by which there shall have been delivered to the
Subscription Receipt Agent for surrender or cancellation all Subscription
Receipt Certificates theretofore certified hereunder;
(b) the issue of certificates or Book-Entry Only System customer
confirmations representing Trust Units and payment of all monies required to all
registered holders of Subscription Receipts as provided in Subsections 3.3(c)
and (d); or
(c) the payment of all monies required where the Acquisition is
terminated or the Acquisition Time does not occur by the Deadline as provided in
Subsections 3.5(c) and (d),
this Agreement shall cease to be of further effect and the Subscription Receipt
Agent, on demand of and at the cost and expense of the Trust and upon delivery
to the Subscription Receipt Agent of a certificate of the Trust stating that all
conditions precedent to the satisfaction and discharge of this Agreement have
been complied with, shall execute proper instruments acknowledging satisfaction
of and discharging this Agreement. Notwithstanding the foregoing, the
indemnities and limitations of liability provided to the Subscription Receipt
Agent by the Trust hereunder shall remain in full force and effect and survive
the termination of this Agreement.
10.6 PROVISIONS OF AGREEMENT AND SUBSCRIPTION RECEIPTS FOR THE SOLE BENEFIT
OF PARTIES AND RECEIPTHOLDERS
Nothing in this Agreement or in the Subscription Receipt
Certificates, expressed or implied, shall give or be construed to give to any
person other than the parties hereto, the Receiptholders and the transferees of
Subscription Receipts as contemplated in Section 3.3 or 3.5, as the case may be,
any legal or equitable right, remedy or claim under this Agreement, or under any
covenant or provision herein or therein contained, all such covenants and
provisions being for the sole benefit of the parties hereto, the Receiptholders
and such transferees.
10.7 SUBSCRIPTION RECEIPTS OWNED BY THE TRUST OR ITS SUBSIDIARIES -
CERTIFICATE TO BE PROVIDED
For the purpose of disregarding any Subscription Receipts
owned legally or beneficially by the Trust or any affiliated entity of the Trust
in Section 7.16, the Trust shall provide to the Subscription Receipt Agent, from
time to time, a certificate of the Trust setting forth as at the date of such
certificate the number of Subscription Receipts owned legally or beneficially by
the Trust or any affiliated entity of the Trust, and the Subscription Receipt
Agent, in making the computations in Section 7.16, shall be entitled to rely on
such certificate without requiring further evidence thereof.
10.8 EFFECT OF EXECUTION
Notwithstanding any provision of this Agreement, should any
Subscription Receipt Certificates be issued and certified in accordance with the
terms hereof prior to the actual time of execution of this Agreement by the
Trust and the Subscription Receipt Agent, any such Subscription Receipt
Certificates shall be void and of no value and effect until such actual
execution.
10.9 TRUST OBLIGATIONS
Where any reference is made herein to an act to be performed
by, for or on behalf of the Trust, such reference shall be construed and applied
for purposes of this Agreement as if it referred to an act to be performed by,
for or on behalf of the Trustee of the Trust, in its capacity as trustee of the
Trust and where any reference is made herein to an act to be performed by, for
or on behalf of the Trustee, such reference shall be construed and applied for
all purposes as if it referred to an act to be performed by, for or on behalf of
the Trustee in its capacity as trustee of the Trust. Resort shall be had only to
the property and assets of the Trust (and not any other assets or property of
the Trustee or any holder of Trust Units) for satisfaction of any obligation or
claim arising out of or in connection with any liability or obligation of the
Trust arising under this Agreement. Neither the holders of Trust Units nor the
Trustee shall have any personal liability or obligations in respect of the
obligations of the Trust under this Agreement, and any recourse a party hereto
may have against the Trust pursuant to this Agreement shall be solely against
the assets of the Trust.
10.10 TIME OF ESSENCE
Time is and shall remain of the essence of this Agreement.
10.11 COUNTERPARTS
This Agreement may be executed and delivered in counterparts, each
of which when so executed and delivered shall be deemed to be an original and
such counterparts together shall constitute one and the same instrument and
notwithstanding their date of execution they shall be deemed to be dated as of
the date hereof.
IN WITNESS WHEREOF the parties hereto have executed this
Agreement under their respective corporate seals and the hands of their proper
officers in that behalf.
HARVEST ENERGY TRUST, by its administrator HARVEST OPERATIONS CORP.
By: /s/ David J. Rain
--------------------------
By:
NATIONAL BANK FINANCIAL INC. on its own behalf and on behalf of TD SECURITIES
INC., CIBC WORLD MARKETS INC., SCOTIA CAPITAL INC., CANACCORD CAPITAL
CORPORATION, GMP SECURITIES LTD. FIRSTENERGY CAPITAL CORP., TRISTONE CAPITAL
INC., HAYWOOD SECURITIES INC. and RAYMOND JAMES LTD.
By: L. Trevor Anderson
VALIANT TRUST COMPANY
By: /s/ PHILIP MENARD
By: /s/ CONCEPCION JALBUENA
SCHEDULE "A"
FORM OF SUBSCRIPTION RECEIPT CERTIFICATE
[THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR
THE BENEFIT OF HARVEST ENERGY TRUST THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED ONLY (A) TO HARVEST ENERGY TRUST, (B) OUTSIDE THE UNITED
STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (C)
INSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 144A UNDER THE SECURITIES ACT,
(D) PURSUANT TO THE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER, OR (E) PURSUANT TO ANOTHER EXEMPTION FROM
REGISTRATION AFTER PROVIDING A LEGAL OPINION SATISFACTORY TO HARVEST ENERGY
TRUST.
IF THESE SECURITIES ARE BEING SOLD IN COMPLIANCE WITH RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT AT A TIME WHEN HARVEST ENERGY TRUST IS A "FOREIGN
ISSUER" AS DEFINED BY REGULATION S, A NEW CERTIFICATE BEARING NO LEGEND MAY BE
OBTAINED FROM VALIANT TRUST COMPANY UPON DELIVERY OF THIS CERTIFICATE AND A DULY
EXECUTED DECLARATION, IN A FORM SATISFACTORY TO VALIANT TRUST COMPANY AND
HARVEST ENERGY TRUST, TO THE EFFECT THAT THE SALE OF THE SECURITIES REPRESENTED
HEREBY IS BEING MADE IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT.]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
CANADIAN DEPOSITORY FOR SECURITIES LIMITED ("CDS") TO THE ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IN
RESPECT THEREOF IS REGISTERED IN THE NAME OF CDS & CO., OR IN SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF CDS (AND ANY PAYMENT IS MADE TO
CDS & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF CDS), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED HOLDER HEREOF,
CDS & CO., HAS AN INTEREST HEREIN.
HARVEST ENERGY TRUST
(a trust established under the laws of the Province of Alberta)
NUMBER: ____ CUSIP/ISIN: o/o
THIS IS TO CERTIFY THAT ______________ (the "HOLDER") is the registered holder
of ________ Subscription Receipts represented hereby.
The Subscription Receipts represented by this Subscription Receipt certificate
(this "CERTIFICATE") are issued pursuant to a Subscription Receipt Agreement
("AGREEMENT") dated August 2, 2005, among Harvest Energy Trust (the "TRUST"),
Valiant Trust Company (the "SUBSCRIPTION RECEIPT AGENT") and National Bank
Financial Inc., on its own behalf and on behalf of the Underwriters.
Capitalized terms used in the Agreement have the same meaning herein as therein,
unless otherwise defined.
Each Subscription Receipt entitles the holder:
(a) if the Acquisition Time occurs by the Deadline, to receive,
for no additional consideration, one Trust Unit plus such holder's Acquisition
Payment, if any, less applicable withholding taxes; or
(b) if the Acquisition Time does not occur by the Deadline, the
Acquisition is terminated at any earlier time or the Trust has advised the
Underwriters or announced to the public that it does not intend to proceed with
the Acquisition, to receive an amount equal to the sum of the Subscription Price
and such holder's PRO RATA share of the Earned Interest, less applicable
withholding taxes, all in the manner and on the terms and conditions set out in
the Agreement.
The Subscription Receipts represented hereby are issued under and pursuant to
the Agreement. Reference is hereby made to the Agreement and any and all other
instruments supplemental or ancillary thereto for a full description of the
rights of the holders of the Subscription Receipts and the terms and conditions
upon which such Subscription Receipts are, or are to be, issued and held, all to
the same effect as if the provisions of the Agreement and all instruments
supplemental or ancillary thereto were herein set forth, and to all of which
provisions the holder of these Subscription Receipts by acceptance hereof
assents. In the event of a conflict or inconsistency between the terms of the
Agreement and this Certificate, the terms of the Agreement shall prevail.
The holding of the Subscription Receipts evidenced by this Certificate shall not
constitute the holder hereof a Unitholder of the Trust or entitle such holder to
any right or interest in respect thereof except as herein and in the Agreement
expressly provided.
The Agreement contains provisions making binding upon all holders of
Subscription Receipts outstanding thereunder resolutions passed at meetings of
such holders held in accordance with such provisions and by instruments in
writing signed by the holders of a specified majority of the outstanding
Subscription Receipts and also contains provisions binding upon all holders of
Subscription Receipts.
The Subscription Receipts evidenced by this Certificate may be transferred on
the register kept at the offices of the Subscription Receipt Agent by the
registered holder hereof or his legal representatives or his attorney duly
appointed by an instrument in writing in form and execution satisfactory to the
Subscription Receipt Agent, only upon payment of the charges provided for in the
Agreement and upon compliance with such reasonable requirements as the
Subscription Receipt Agent may prescribe. The transfer register shall be closed
at 5:00 p.m. (Calgary time) on the earlier to occur of the Acquisition Date and
the Termination Date (subject to settlement of trades).
This Certificate shall not be valid for any purpose whatever unless and until it
has been countersigned by or on behalf of the Subscription Receipt Agent.
Time shall be of the essence hereof. This Certificate is governed by the laws of
Alberta and the laws of Canada applicable therein. IN WITNESS WHEREOF the Trust
has caused this Certificate to be signed by a duly authorized representative as
of August 2, 2005.
HARVEST ENERGY TRUST by
HARVEST OPERATIONS CORP.
By:
Name:
Title:
Countersigned by: VALIANT TRUST COMPANY as
Subscription Receipt
Agent
By:
Name:
Title:
By:
Name:
Title: