Air Canada 2012 Annual Report Download - page 124

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2012 Air Canada Annual Report
124
Under the terms of the Rights Plan, one right (a “Right”) has been issued with respect to each Class B Voting Share and each
Class A Variable Voting Share (each a “Share”) of Air Canada issued and outstanding as of the close of business on March 30,
2011 or subsequently issued. These Rights would become exercisable only when a person, including any party related to it,
acquires or announces its intention 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, without complying with the “Permitted Bid” provisions of the
Rights Plan or, in certain cases, without the approval of the Board. Until such time, the Rights are not separable from the
shares, are not exercisable and no separate rights certificates are issued. To qualify as a “Permitted Bid” under the Rights Plan,
a bid must, among other things: (i) be made to all holders of Shares, (ii) remain open for a period of not less than 60 days, (iii)
provide that no Shares shall be taken up unless more than 50% of the then outstanding Class A Variable Voting Shares and
Class B Voting Shares, on a combined basis, other than the Shares held by the person pursuing the acquisition and parties
related to it, have been tendered and not withdrawn, and (iv) provide that if such 50% condition is satisfied, the bid will be
extended for at least 10 business days to allow other shareholders to tender.
Following the occurrence of an event which triggers the right to exercise the Rights and subject to the terms and conditions of
the Rights Plan, each Right would entitle the holders thereof, other than the acquiring person or any related persons, to
exercise their Rights and purchase from Air Canada $200 worth of Class A Variable Voting Shares or Class B Voting Shares for
$100 (i.e. at a 50% discount to the market price at that time). Upon such exercise, holders of rights beneficially owned and
controlled by Qualified Canadians would receive Class B Voting Shares and holders of rights beneficially owned or controlled
by persons who are not Qualified Canadians would receive Class A Variable Voting Shares.
The Rights Plan is scheduled to expire at the close of business on the date immediately following the date of Air Canada's
annual meeting of shareholders to be held in 2014, unless terminated earlier in accordance with the terms of the Rights Plan.