Air Canada 2012 Annual Report Download - page 123

Download and view the complete annual report

Please find page 123 of the 2012 Air Canada annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 150

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150

2012 Consolidated Financial Statements and Notes
123
Voting Shares may only be held, beneficially owned and controlled, directly or indirectly, by Canadians. An issued and
outstanding Voting Share shall be converted into one Variable Voting Share automatically and without any further act of Air
Canada or the holder, if such Voting Share becomes held, beneficially owned or controlled, directly or indirectly, otherwise
than by way of security only, by a person who is not a Canadian.
Issuer Bid
In December 2011, Air Canada announced that it received approval from the Toronto Stock Exchange (“TSX”) to implement a
normal course issuer bid to purchase, for cancellation, up to 24,737,753 Class A Variable Voting Shares and/or Class B Voting
Shares (the “Shares”), representing, at that time, 10% of the total public float of the Shares.
The repurchase program, which commenced on December 12, 2011 and ended December 11, 2012, was conducted through
the facilities of the TSX.
During 2012, the Corporation purchased and cancelled 3,019,600 shares for cash at an average cost of $1.67 per share.
(2011 – 239,524 shares at an average cost of $1.08 per share).
Warrants
A summary of warrants outstanding as at December 31, 2012 is as follows:
Grant date Number of Warrants
Outstanding Exercise Prices Expiry Dates Remaining Life (Years)
30-Jul-09 5,000,000 $1.51 30-Jul-13 0.6
19-Oct-09 5,000,000 $1.44 19-Oct-13 0.8
10,000,000
During 2012, 79,430,300 warrants with an exercise price of $2.20 expired. Upon expiry, the value ascribed to Share capital
related to the warrants of $18 was reclassified to the Deficit. During 2012 and 2011, no warrants were exercised.
Each outstanding warrant entitles the holder thereof to acquire one Class A Variable Voting Share (if the holder at the time of
exercise is not a Canadian within the meaning of the Canadian Transportation Act) or one Class B Voting Share (if the holder at
the time of exercise is a Canadian within the meaning of the Canadian Transportation Act) (each, a “Warrant Share”) at the
exercise price per Warrant Share, at any time prior to its expiry date.
Shareholder Rights Plan
In 2012, the shareholders of Air Canada approved amendments to the shareholder rights plan agreement (the "Rights Plan")
which provide that, subject to certain exceptions identified in the Rights Plan, the Rights Plan, as last amended, would be
triggered in the event of an offer to acquire 20% or more of the outstanding Class A variable voting shares and Class B voting
shares of Air Canada calculated on a combined basis, instead of 20% or more of either the outstanding Class A variable voting
shares or the Class B voting shares calculated on a per class basis as was the case under the Rights Plan prior to the
amendments that came into effect in 2012.
The amendments to the Rights Plan were proposed and implemented in order to render effective a decision issued by
Canadian securities regulatory authorities (pursuant to an application of Air Canada) that effectively treats Air Canada's
Class A variable voting shares and Class B voting shares as a single class for the purposes of applicable take-over bid
requirements and early warning reporting requirements contained under Canadian securities laws.