Document:

Exhibit 4.1

 

 

ITC HOLDINGS CORP.

 

to

 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

as Trustee

 

 

Fifth Supplemental Indenture

Dated as of May 16, 2014

 

Supplemental to the Indenture dated as of July 16, 2003

and

Second supplemental Indenture dated as of October 10, 2006

 

5.875% Senior Notes Due 2016

6.375% Senior Notes Due 2036

 

 

 

FIFTH SUPPLEMENTAL INDENTURE, dated as of May 16, 2014 (herein called the “Fifth Supplemental Indenture”), between ITC Holdings Corp., a corporation duly organized and existing under the laws of the State of Michigan (hereinafter called the “Company”), and The Bank of New York Mellon Trust Company, N.A. (f.k.a. The Bank of New York Trust Company, N.A., as successor to BNY Midwest Trust Company), as Trustee under the Indenture referred to below (hereinafter called the “Trustee”).

 

WITNESSETH:

 

WHEREAS, the Company and the Trustee have heretofore executed and delivered that certain Indenture, dated as of July 16, 2003 (the “Base Indenture”), as amended and supplemented by the second supplemental indenture, dated as of October 10, 2006 (together with the Base Indenture, the “Indenture”);

 

WHEREAS, on October 10, 2006, the Company issued $255,000,000 in aggregate principal amount of its 5.875% Senior Notes due 2016 (the “2016 Senior Notes”) and $255,000,000 in aggregate principal amount of its 6.375% Senior Notes due 2036 (the “2036 Senior Notes” and, together with the 2016 Senior Notes, the “Notes”);

 

WHEREAS, $255,000,000 in aggregate principal amount of the 2016 Senior Notes and $255,000,000 in aggregate principal amount of the 2036 Senior Notes are currently outstanding;

 

WHEREAS, Section 9.2 of the Indenture provides that, with the consent of Holders (as defined in the Indenture) of a majority in aggregate principal amount of the Notes then outstanding (voting together as a class), the Company and the Trustee may enter into an indenture supplemental to the Indenture to, for the purpose of amending or supplementing the Indenture or the Notes (subject to certain exceptions);

 

WHEREAS, the Company has: (i) offered to purchase for cash any and all of the outstanding Notes (the “Offer”) and (ii) solicited (the “Consent Solicitation”) consents (the “Consents”) to amend the Indenture to modify certain of the covenants applicable to the Notes contained in the Indenture (collectively, the “Proposed Amendments”), upon the terms and subject to the conditions set forth in the offer to purchase and consent solicitation statement, dated May 2, 2014 (as it may be amended or supplemented, the “Offer to Purchase”), and in the related letter of transmittal and consent (as it may be amended or supplemented, which together with the Offer to Purchase, constitute the “Offer”);

 

WHEREAS, in connection with the Offer, the Company will, upon satisfaction of certain conditions set forth in the Offer to Purchase, pay an aggregate cash payment equal to $1,117.39 per $1,000 aggregate principal amount of 2016 Senior Notes and $1,243.27 per $1,000 aggregate principal amount of 2036 Senior Notes (together, the “Total Consideration”), which comprises (a) $1,087.39 per $1,000 principal amount of the 2016 Senior Notes for which such Notes are validly tendered and unrevoked or $1,213.27 per $1,000 principal amount of the 2036 Senior Notes for which such Notes are validly tendered and unrevoked (together, the “Tender Offer Consideration”) and (b) $30.00 per $1,000 principal amount of the Notes for which consents to the Proposed Amendments are validly delivered and unrevoked to D.F. King & Co., Inc. (the “Depositary”) on behalf of the Holders who delivered such valid and unrevoked tenders and consents on or prior to 5:00 P.M., New York City time, on May 15, 2014 (the “Consent Expiration Date”). In addition, the Company will, upon satisfaction of certain conditions set forth in the Offer to Purchase, pay an aggregate cash payment equal to $2.50 per $1,000 aggregate principal amount of Notes for which consents to the Proposed Amendments are validly delivered and unrevoked to the Depositary on behalf of the Holders who delivered such valid and unrevoked consents without tendering Notes on or prior to the Consent Expiration Date (the “Consent Payment”);

 

WHEREAS, the Company’s ability to effect the Proposed Amendments is conditioned upon, among other things, the Proposed Amendments to the Indenture set forth herein having been approved by the requisite consents (and this Fifth Supplemental Indenture in respect thereof having been executed and delivered), with such Proposed Amendments shall cease to be operative if the Company does not pay the Total Consideration, the Tender Offer Consideration or the Consent Payment, as applicable, to the Depositary or, upon the Depositary’s instructions, The Depository Trust Company on behalf of the Holders;

 

 

WHEREAS, the Company desires and has requested the Trustee to join with it in entering into this Fifth Supplemental Indenture for the purpose of amending the Indenture and the Notes in certain respects as permitted by Section 9.2 of the Indenture, all action on the part of the Company necessary to authorize the execution and delivery of this Fifth Supplemental Indenture has been duly taken;

 

WHEREAS, (1) the Company has received the consent of the Holders of at least a majority in aggregate principal amount of the outstanding Notes (voting together as a class), all as certified by an Officers’ Certificate delivered to the Trustee simultaneously with the execution and delivery of this Fifth Supplemental Indenture, (2) the Company has delivered to the Trustee simultaneously with the execution and delivery of this Fifth Supplemental Indenture an Opinion of Counsel stating that the execution of this Fifth Supplemental Indenture is authorized or permitted by the Indenture as contemplated by Section 9.3 of the Indenture and (3) the Company have satisfied all other conditions required under Article 9 of the Indenture to enable the Company and the Trustee to enter into this Fifth Supplemental Indenture.

 

NOW, THEREFORE, THIS FIFTH SUPPLEMENTAL INDENTURE WITNESSETH:

 

That in consideration of the premises, each party hereby agrees, for the benefit of the others and for the equal and ratable benefit of the Holders of the Notes, as follows:

 

ARTICLE ONE

 

DEFINITIONS

 

Except to the extent such terms are otherwise defined in this Fifth Supplemental Indenture or the context clearly requires otherwise, all terms used in this Fifth Supplemental Indenture which are defined in the Indenture, have the meanings assigned to them therein.

 

ARTICLE TWO

 

AMENDMENTS TO INDENTURE AND NOTES

 

Section 2.1            Amendments to Section 1.1 of the Base Indenture. The text of Section 1.1 of the definition of “First Mortgage Indenture” contained in Section 1.1 of the Base Indenture is hereby deleted in its entirety and replaced with the following:

 

“First Mortgage Indentures” means, collectively, (i) the First Mortgage and Deed of Trust, dated as of July 15, 2003, between International Transmission Company and BNY Midwest Trust Company (succeeded by The Bank of New York Trust Company, N.A.), as trustee, (ii) the First Mortgage Indenture, dated as of December 10, 2003, between Michigan Electric Transmission Company, LLC and JPMorgan Chase Bank (succeeded by The Bank of New York Trust Company, N.A.), as trustee, (iii) the First Mortgage and Deed of Trust, dated as of January 14, 2008, between ITC Midwest LLC and The Bank of New York Trust Company, N.A. (succeeded by The Bank of New York Mellon Trust Company, N.A.), as trustee, and (iv) any mortgage bond indenture or other document similar to (i) through (iii) above that secures indebtedness of any Subsidiary by creating Liens on the assets of such Subsidiary similar to those created by (i) through (iii) above, and in the case of each of (i) through (iv) above, as the same may be amended, supplemented or otherwise modified and in effect from time to time.

 

In addition, Section 1.1 of the Base Indenture is amended by deleting from such Section those defined terms and section references that, by virtue of the amendments effected by this Fifth Supplemental Indenture, are no longer used in the Indenture or the Notes as amended hereby.

 

Section 2.2            Modification of Section 6.11 of the Base Indenture. The last paragraph of Section 6.11 of the Base Indenture is deleted in its entirety and replaced with the following:

 

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No successor Trustee with respect to any series of Securities shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible with respect to that series under this Article 6.  No Person who serves as Trustee shall have any responsibility or liability for the action or any inaction of a successor Trustee.

 

Section 2.3            Modification of Section 6.14 of the Base Indenture. The first paragraph of Section 6.14 of the Base Indenture is deleted in its entirety and replaced with the following:

 

From time to time the Trustee may appoint one or more Authenticating Agents with respect to one or more series of Securities with power to act on the Trustee’s behalf and subject to its direction in the authentication and delivery of Securities of such series or in connection with transfers and exchanges under Sections 3.4, 3.5, 3.6 and 11.7 hereof as fully to all intents and purposes as though the Authenticating Agent had been expressly authorized by those Sections of this Indenture to authenticate and deliver Securities of such series. For all purposes of this Indenture, the authentication and delivery of Securities by an Authenticating Agent pursuant to this Section 6.14 shall be deemed to be the authentication and delivery of such Securities “by the Trustee”. Each such Authenticating Agent shall be acceptable to the Company and shall at all times be a Corporation organized and doing business under the laws of the United States, any state thereof or the District of Columbia, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by Federal, state or District of Columbia authority. If such Corporation publishes reports of condition at least annually pursuant to law or the requirements of such authority, then for the purposes of this Section 6.14 the combined capital and surplus of such Corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section 6.14, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this Section 6.14.  If the Authenticating Agent has or shall acquire any conflicting interest, as defined in Section 310(b) of the Trust Indenture Act, with respect to Securities of any series, the Authenticating Agent shall take action as is required pursuant to said Section 310(b).

 

Section 2.4            Insertion of Section 6.15 to the Base Indenture. The following language is inserted as Section 6.15 of the Base Indenture:

 

Section 6.15          Force Majeure. In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

Section 2.5            Modification of Section 10.9(c) of the Base Indenture. The text of Section 10.9(c) of the Base Indenture is deleted in its entirety and replaced with the following:

 

Liens to secure Indebtedness issued under any First Mortgage Indenture;

 

Section 2.6            Modification of Section 10.11 of the Base Indenture. The text of Section 10.11 of the Base Indenture is deleted in its entirety and replaced with the following:

 

(a) The Company, pursuant to Section 314(a) of the Trust Indenture Act, shall file with the Trustee, within 15 days after the Company files the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Company files with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act; or, if the Company is not required to file information, documents or reports pursuant to either of said Sections, then it shall file with the Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Exchange Act in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations; provided that any such information, documents or reports filed electronically with the

 

3

 

Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be deemed filed with, and delivered to, the Trustee; provided, further, the Company shall notify the Trustee if it shall fail to so file any such information, documents or reports with the Commission.

 

(b) The Company, pursuant to Section 314(a) of the Trust Indenture Act, shall file with the Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and transmit by mail to all Holders of the Securities, at their names and addresses as they appear in the Security Register, within 30 days after the filing thereof with the Trustee, such summaries of any information, documents and reports required to be filed by the Company pursuant to paragraphs (a) and (b) of this Section, as may be required by rules and regulations prescribed from time to time by the Commission; provided that any such information, documents or reports filed electronically with the Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be deemed filed with, and delivered to, the Trustee and the Holders; provided, further, the Company shall notify the Trustee if it shall fail to so file any such information, documents or reports with the Commission.

 

(c) The Trustee shall have no duty to monitor whether the Company so files any such information, documents or reports with the Commission, and in the absence of receiving the notice referenced in the preceding clauses (a) and (b), the Trustee shall be entitled to presume that the Company has so filed such information, documents or reports. Delivery of such reports, information and documents to the Trustee is for informational purposes only and shall not constitute a representation or warranty as to the accuracy or completeness of the reports, information or documents. The Trustee’s receipt of such reports, information or documents shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to conclusively rely exclusively on an Officers’ Certificate).

 

(d) Further, the Company shall furnish to the Holders and to prospective investors, upon the request of such Holders, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the relevant Securities are not freely transferable under the Securities Act.

 

Section 2.7            Amendments to Notes.  The Notes are hereby amended to delete all provisions inconsistent with the other amendments to the Indenture effected by this Fifth Supplemental Indenture.

 

4

 

ARTICLE THREE

 

MISCELLANEOUS

 

Section 3.1            Execution as Supplemental Indenture. This Fifth Supplemental Indenture is executed and shall be construed as an indenture supplemental to the Base Indenture and, as provided in the Indenture, this Fifth Supplemental Indenture forms a part thereof.

 

Section 3.2            Conflict with Trust Indenture Act. This Fifth Supplemental Indenture may, but is not, as of the date first written above, required to be, qualified under and subject to the Trust Indenture Act. If this Fifth Supplemental Indenture shall become qualified under and subject to the Trust Indenture Act, then if any provision hereof limits, qualifies or conflicts with another provision hereof, or with a provision of the Indenture, which is required to be included in this Fifth Supplemental Indenture, or in the Indenture, respectively, by any of the provisions of the Trust Indenture Act, such required provision shall control to the extent it is applicable. Except as expressly provided otherwise herein, any reference herein to a requirement under the Trust Indenture Act shall apply only upon and so long as this Fifth Supplemental Indenture shall become qualified under and subject to the Trust Indenture Act.

 

Section 3.3            Effect of Headings. The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

 

Section 3.4            Successors and Assigns. All covenants and agreements by the Company and the Trustee in this Fifth Supplemental Indenture shall bind its successors and assigns, whether so expressed or not.

 

Section 3.5            Separability Clause. In case any provision in this Fifth Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 3.6            Benefits of Fifth Supplemental Indenture. Nothing in this Fifth Supplemental Indenture, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder and the Holders, any benefit or any legal or equitable right, remedy or claim under this Fifth Supplemental Indenture.

 

Section 3.7            Execution and Counterparts. This Fifth Supplemental Indenture may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

 

Section 3.8            Governing Law. This Fifth Supplemental Indenture shall be governed by and construed in accordance with the laws of the State of New York except that if this Fifth Supplemental Indenture shall become qualified under and subject to the Trust Indenture Act, this Fifth Supplemental Indenture shall be governed by the Trust Indenture Act to the extent that the Trust Indenture Act shall be applicable.

 

Section 3.9            Effectiveness. The provisions of this Fifth Supplemental Indenture shall be effective only upon execution and delivery of this instrument by the parties hereto.  Notwithstanding the foregoing sentence, the provisions of this Fifth Supplemental Indenture shall become operative only upon the Company’s purchase of the tendered Notes and payment for the Consents received pursuant to the Offer and the Consent Solicitation. If such purchase and payment shall not occur, the amendments to the Indenture effected by this Fifth Supplemental Indenture shall be deemed to be revoked retroactive to the date hereof.  The Company shall notify the Trustee in writing promptly after the occurrence of such purchase or promptly after the Company shall determine that such purchase will not occur.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Fifth Supplemental Indenture to be duly executed as of the day and year first above written.

 

 

	
 
    	
ITC HOLDINGS CORP.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Cameron M. Bready
    
	
 
    	
Name:
    	
Cameron M. Bready
    
	
 
    	
Title:
    	
Executive Vice President and Chief
    
	
 
    	
 
    	
Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
TRUSTEE:
    
	
 
    	
 
    	
 
    
	
 
    	
THE BANK OF NEW YORK MELLON TRUST COMPANY,   N.A., as Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Lawrence M. Kusch
    
	
 
    	
Name:
    	
Lawrence M. Kusch
    
	
 
    	
Title:
    	
Vice President
    

 

[Signature Page to Supplemental Indenture]Exhibit 4.17

 

 

This document is important and requires your immediate attention. If you are in any doubt as to how to deal with it, you should consult your investment advisor, stockbroker, bank, trust company or other nominee.

 

May 16, 2014

 

 

NOTICE OF VARIATION AND EXTENSION

 

of HudBay Minerals Inc.’s offer to purchase

 

all of the issued and outstanding common shares of

 

AUGUSTA RESOURCE CORPORATION

 

for consideration per Augusta Share of
 0.315 of a Hudbay Share

 

HudBay Minerals Inc. (the “Offeror”) hereby gives notice that it is varying its offer dated February 10, 2014, as amended by the Notice of Variation and Extension dated March 14, 2014, the Notice of Variation and Extension dated March 31, 2014, the Notice of Change dated April 24, 2014, and the Notice of Variation and Extension dated May 5, 2014 (collectively, the “Original Offer”), to purchase, on and subject to the terms and conditions of the Original Offer, as amended, all of the issued and outstanding common shares (the “Augusta Shares”) of Augusta Resource Corporation (“Augusta”), other than any Augusta Shares held directly or indirectly by the Offeror and its affiliates, including any Augusta Shares that may become issued and outstanding after February 10, 2014 but before the Expiry Time (as defined herein) upon the exercise, exchange or conversion of any securities of Augusta exercisable or exchangeable for, convertible into or otherwise conferring a right to acquire, any Augusta Shares, including, any options, warrants or convertible debentures (“Convertible Securities”), together with the associated rights issued under Augusta’s Shareholder Rights Plan, in order to extend the Original Offer to 5:00 p.m. (Toronto time) on May 27, 2014. The Original Offer, as amended and extended hereby, is referred to herein as the “Offer”.

 

THE ORIGINAL OFFER HAS BEEN EXTENDED, AND IS NOW OPEN FOR ACCEPTANCE
 UNTIL 5:00 P.M. (TORONTO TIME) ON MAY 27, 2014 (THE “EXPIRY TIME”).

 

This Notice of Variation and Extension should be read in conjunction with the Original Offer and the take-over bid circular (the “Original Circular”) dated February 10, 2014, as previously amended (the Original Offer together with the Original Circular collectively referred to as the “Original Offer and Circular”), and the letter of transmittal (the “Letter of Transmittal”) and notice of guaranteed delivery (the “Notice of Guaranteed Delivery”) that accompanied the Original Offer and Circular. The Original Offer and Circular, as amended previously and by this Notice of Variation and Extension collectively constitute the “Offer and Circular”. Except as otherwise set forth herein, the terms and conditions previously set forth in the Original Offer and Circular, Letter of Transmittal and Notice of Guaranteed Delivery, each as previously amended, continue to be applicable in all respects. All references to the “Offer” in the Original Offer and Circular, the Letter of Transmittal, the Notice of Guaranteed Delivery and this Notice of Variation and Extension mean the Original Offer as amended hereby, and all references in such documents to the “Circular” or the “Offer and Circular” mean the Original Offer and Circular as amended hereby. Unless the context requires otherwise, capitalized terms used herein but not defined herein that are defined in the Original Offer and Circular have the respective meanings given to them in the Original Offer and Circular.

 

The offering of Hudbay Shares pursuant to the Offer is made by a Canadian issuer that is permitted, under a multi-jurisdictional disclosure system adopted by the United States, to prepare the Offer and Circular in accordance with the disclosure requirements of Canada. The Offer is subject to applicable disclosure requirements in Canada. Augusta Shareholders should be aware that such requirements are different from those of the United States and may differ from those in other jurisdictions. Financial statements included or incorporated by reference in the Offer and Circular have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and are subject to Canadian auditing standards and auditor independence rules, and thus may not be comparable to financial statements of United States companies or companies incorporated in other jurisdictions. Augusta Shareholders in the United States should be aware that the disposition of Augusta Shares and acquisition of Hudbay Shares by them as described in the Offer and Circular may have tax consequences in the United States, Canada and other jurisdictions. Such consequences may not be fully described in the Offer and Circular and such holders are urged to consult their tax advisors. The enforcement by Augusta Shareholders of civil liabilities under U.S. federal or state securities laws or applicable laws of other jurisdictions may be affected adversely by the fact that the Offeror is incorporated under and governed by the laws of Canada, that its officers and directors may be residents of jurisdictions other than the United States or such other jurisdictions, that the experts named in the Circular may be residents of jurisdictions other than the United States or such other jurisdictions, that all or a substantial portion of the assets of the Offeror and such persons may be located outside the United States or such other jurisdictions, that some of Augusta’s officers and directors are resident outside the United States or such other jurisdictions and that all or a substantial portion of the assets of Augusta and Augusta’s officers and directors may be located outside the United States or such other jurisdictions.

 

THE HUDBAY SHARES AND THE OFFER HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION (“SEC”) OR ANY OTHER SECURITIES REGULATORY

 

 

AUTHORITY, NOR HAS THE SEC OR ANY OTHER SUCH AUTHORITY PASSED UPON THE ACCURACY OR ADEQUACY OF THE OFFER AND CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

Prospective investors should be aware that, during the period of the Offer, the Offeror or its affiliates, directly or indirectly, may bid for or make purchases of the securities to be distributed or to be exchanged, or certain related securities, as permitted by applicable laws or regulations of Canada or its provinces or territories. Neither the Offeror nor any of its affiliates intends to make any such purchases during the period of the Offer.

 

Information has been incorporated by reference in the Offer and Circular from documents filed with the securities commissions or similar authorities in Canada. Copies of the documents incorporated by reference in the Offer and Circular are available electronically on SEDAR and EDGAR at www.sedar.com and www.sec.gov, respectively.

 

	
The Depositary for the   Offer is:
    	
Information Agent for the   Offer is:
    
	
 
    	
 
    
	
Equity Financial Trust   Company
    	
Kingsdale Shareholder   Services
    
	
 
    	
 
    
	
The Dealer Managers for   the Offer are:
    
	
 
    
	
In Canada
    	
In the United States
    
	
 
    	
 
    
	
GMP Securities L.P.
    	
BMO Nesbitt Burns Inc.
    	
Griffiths McBurney Corp.
    	
BMO Capital Markets Corp.
    
				

 

Augusta Shareholders who have validly deposited and not withdrawn their Augusta Shares need take no further action to accept the Offer.

 

Registered Augusta Shareholders who wish to accept the Offer must properly complete and execute the Letter of Transmittal (printed on YELLOW paper) that accompanied the Original Offer and Circular, or a manually executed facsimile thereof, and deposit it, at or prior to the Expiry Time, together with certificate(s) or Direct Registration System (DRS) Advices representing their Augusta Shares and all other required documents, with Equity Financial Trust Company (the “Depositary”) at its office in Toronto, Ontario specified in the Letter of Transmittal, in accordance with the instructions set out in the Letter of Transmittal (as set out in Section 3 of the Original Offer, “Manner of Acceptance — Letter of Transmittal”). Alternatively, registered Augusta Shareholders may accept the Offer by following the procedure for guaranteed delivery set out in Section 3 of the Original Offer, “Manner of Acceptance — Procedure for Guaranteed Delivery”, using the Notice of Guaranteed Delivery (printed on GREEN paper) that accompanied the Original Offer and Circular, or a manually executed facsimile thereof. Augusta Shareholders who hold their Augusta Shares with an investment advisor, stockbroker, bank, trust company or other nominee will not have received a Letter of Transmittal or Notice of Guaranteed Delivery, and should follow the instructions set out by such nominee to tender their Augusta Shares.

 

Persons whose Augusta Shares are registered in the name of an investment advisor, stockbroker, bank, trust company or other nominee should contact such nominee for assistance if they wish to accept the Offer in order to take the necessary steps to be able to deposit such Augusta Shares under the Offer. Nominees likely have established tendering cut-off times that are up to 48 hours prior to the Expiry Time. Augusta Shareholders must instruct their investment advisor, stockbroker, bank, trust company or other nominee promptly if they wish to tender.

 

Augusta Shareholders will not be required to pay any fee or commission if they accept the Offer by depositing their Augusta Shares directly with the Depositary or if they make use of the services of a Soliciting Dealer to accept the Offer.

 

Questions and requests for assistance may be directed to Kingsdale Shareholder Services (the “Information Agent”), who can be contacted at 1-866-229-8874 toll free in North America or at 1-416-867-2272 outside of North America or by e-mail at contactus@kingsdaleshareholder.com; or to the Depositary at the addresses indicated on the last page of this document and additional copies of this document, the Original Offer and Circular, the Letter of Transmittal and the Notice of Guaranteed Delivery, or any documents incorporated by reference or otherwise related to the Offer, may be obtained, without charge, upon request from the Depositary or the Information Agent at their respective offices shown on the last page of this document, and are accessible on the Canadian Securities Administrators’ website at www.sedar.com, on EDGAR at www.sec.gov and on the Offeror’s website at www.hudbayminerals.com. These website addresses are provided for informational purposes only and no information contained on, or accessible from, these websites is incorporated by reference in the Offer and Circular unless otherwise expressly indicated in the Offer and Circular.

 

The information contained in this document is current only as of the date of this document. The Offeror does not undertake to update any such information except as required by applicable Law. Information in this document and in the Original Offer and Circular related to Augusta has been compiled from public sources — see “INFORMATION CONCERNING AUGUSTA” in the Original Offer and Circular.

 

 

No broker, dealer, salesperson or other person has been authorized to give any information or make any representation other than those contained in this Notice of Variation and Extension or the Original Offer and Circular, and, if given or made, such information or representation must not be relied upon as having been authorized by the Offeror, the Depositary, the Information Agent or the Dealer Managers.

 

 

ADDITIONAL NOTICE TO UNITED STATES SHAREHOLDERS

AND OTHER SHAREHOLDERS OUTSIDE CANADA

 

The Offer is subject to Section 14(d) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”), Regulation 14D promulgated by the SEC thereunder, Section 14(e) of the Exchange Act, and Regulation 14E promulgated by the SEC thereunder.

 

The Offeror has filed with the SEC a registration statement on Form F—10, which contains a prospectus relating to the Offer, a tender offer statement on a Schedule TO and other documents and information, as such documents have been amended, modified, supplemented or restated. AUGUSTA SHAREHOLDERS AND OTHER INTERESTED PARTIES ARE URGED TO READ THESE DOCUMENTS, ALL DOCUMENTS INCORPORATED BY REFERENCE, ALL OTHER APPLICABLE DOCUMENTS AND ANY AMENDMENTS OR SUPPLEMENTS TO ANY SUCH DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE EACH CONTAINS OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE OFFEROR, AUGUSTA AND THE OFFER. Materials filed with the Canadian securities regulatory authorities are available electronically without charge at www.sedar.com. Materials filed with the SEC are available electronically without charge at the SEC’s website, www.sec.gov. All such materials may also be obtained without charge at the Offeror’s website, www.hudbayminerals.com or by directing a written or oral request to the Information Agent for the Offer, Kingsdale Shareholder Services, at 1-866-229-8874 toll free in North America or at 1-416-867-2272 or by e-mail at contactus@kingsdaleshareholder.com or to the Vice President, Legal and Corporate Secretary of the Offeror at 25 York Street, Suite 800, Toronto, Ontario, telephone 1-416-362-8181.

 

Neither this document nor the Original Offer and Circular generally addresses the income tax consequences of the Offer to Augusta Shareholders in any jurisdiction outside Canada or the United States. Augusta Shareholders in a jurisdiction outside Canada or the United States should be aware that the disposition of Augusta Shares may have tax consequences which may not be described in this document or the Original Offer and Circular. Accordingly, Augusta Shareholders outside Canada and the United States should consult their own tax advisors with respect to tax considerations applicable to them.

 

The Original Offer and Circular also contains a cautionary note regarding mineral reserve and resource estimates prepared in accordance with Canadian National Instrument 43-101 — Standards of Disclosure for Mineral Projects — see “CAUTIONARY NOTE REGARDING MINERAL RESERVES AND MINERAL RESOURCES” in the Original Offer and Circular.

 

NOTICE TO HOLDERS OF CONVERTIBLE SECURITIES

 

The Offer is made only for Augusta Shares, together with the associated rights issued under the Shareholder Rights Plan, and is not made for any options, warrants or convertible debentures or any other rights to acquire Augusta Shares. Any holder of Convertible Securities who wishes to accept the Offer should, subject to and to the extent permitted by the terms of such Convertible Securities and applicable Law, exercise, exchange or convert such Convertible Securities in order to obtain certificates representing Augusta Shares and deposit such Augusta Shares in accordance with the Offer. See Section 1 of the Original Offer, “The Offer”. Any such exercise, exchange or conversion must be completed sufficiently in advance of the Expiry Time to ensure that the holder of such Convertible Securities will have received certificates representing the Augusta Shares issuable upon such exercise, exchange or conversion in time for deposit prior to the Expiry Time, or in sufficient time to comply with the procedures described in Section 3 of the Original Offer, “Manner of Acceptance — Procedure for Guaranteed Delivery”.

 

The tax consequences to holders of Convertible Securities of exercising or not exercising such securities are not described in the Offer and Circular. Holders of such Convertible Securities should consult their own tax advisors with respect to the potential tax consequences to them in connection with the decision to exercise or not exercise such securities.

 

iv

 

REPORTING CURRENCY AND CURRENCY EXCHANGE RATE INFORMATION

 

All dollar references in this document and the Original Offer and Circular are in Canadian dollars, except where otherwise indicated. On February 7, 2014, the Bank of Canada noon rate of exchange for the Canadian dollar, expressed in U.S. dollars, was Canadian $1.00 = United States $0.9076.

 

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

 

This Notice of Variation and Extension contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian and United States securities legislation. Forward-looking information includes information that relates to, among other things, statements with respect to the anticipated timing, mechanics and completion and settlement of the Offer, including the permitting of the Rosemont project. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by the Offeror at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that the Offeror identified and applied in drawing conclusions or making forecasts or projections set out in the forward looking information include, but are not limited to, the accuracy of Augusta’s public disclosure; no significant and continuing adverse changes in general economic conditions or conditions in the financial markets; that all required regulatory and governmental approvals for the Offer will be obtained and all other conditions to completion of the Offer will be satisfied or waived.

 

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, the market value of the Hudbay Shares received as consideration under the Offer and the impact of such issuance on the market price of the Hudbay Shares, the development of the Rosemont Project not occurring as planned, the inaccuracy of Augusta’s public disclosure upon which the Offer is predicated, the triggering of change of control provisions in Augusta’s agreements leading to adverse consequences, Augusta becoming a minority-owned or majority-owned subsidiary of the Offeror after consummation of the Offer, the possibility that the Offeror may remain a minority shareholder of Augusta after consummation of the Offer without the ability to control the management or direction of Augusta, as well as the risks discussed under the heading “Risk Factors” in the Original Offer and Circular and other documents filed with Canadian and U.S. securities regulatory authorities. Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. The Offeror does not assume any obligation to update or revise any forward-looking information after the date of this Notice of Variation and Extension or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

 

The Original Offer and Circular also contains forward looking information and this cautionary note should be read in conjunction with the Cautionary Note Regarding Forward Looking Statements in the Original Offer and Circular.

 

 

NOTICE OF VARIATION AND EXTENSION

 

May 16, 2014

 

TO: THE HOLDERS OF COMMON SHARES OF AUGUSTA RESOURCE CORPORATION

 

This Notice of Variation and Extension amends and supplements the Original Offer and Circular, pursuant to which the Offeror is offering to purchase, on the terms and subject to the conditions of the Offer, all of the issued and outstanding Augusta Shares, other than any Augusta Shares held directly or indirectly by the Offeror and its affiliates, including any Augusta Shares that may become issued and outstanding upon the exercise, exchange or conversion of Convertible Securities after the date of the Original Offer and Circular but prior to the Expiry Time, together with the associated rights issued under the Shareholder Rights Plan, for consideration per Augusta Share of 0.315 of a Hudbay Share.

 

The Offeror continues to monitor developments with respect to Augusta’s applications for permits required for the Rosemont project. The Offeror is assessing, among other things, the potential implications of a letter dated May 13, 2014 that the U.S. Army Corps of Engineers (the “USACE”) is reported to have sent to Augusta. The USACE letter advises Augusta that, in the context of its Clean Water Act section 404 permit application, Augusta’s proposed compensatory mitigation is inadequate and USACE staff is changing its focus from compensatory mitigation to preparing a final permit decision.

 

On March 14, 2014, the Offeror waived the condition that there shall have been validly deposited under the Offer and not withdrawn, at or prior to the expiration of the Offer, such number of Augusta Shares that, together with the Augusta Shares already owned by the Offeror and its affiliates, represents not less than 662/3% of the Augusta Shares (calculated on a fully diluted basis). The Offeror has not waived any other conditions of the Offer described in Section 4 of the Original Offer, “Conditions of the Offer”, as amended.

 

1.                                      Extension of the Offer

 

The Offeror has extended the time for acceptance of the Offer to 5:00 p.m. (Toronto time) on May 27, 2014. Accordingly, the definition of “Expiry Date” in the “Glossary” section of the Original Offer and Circular is hereby deleted and replaced by the following:

 

“Expiry Date” means May 27, 2014 or such later date or dates to which the Offer may be extended from time to time by the Offeror in accordance with Section 5 of the Offer, “Extension, Variation or Change of the Offer”;

 

In addition, all references to “5:00 p.m. (Toronto time) on May 16, 2014” in the Original Offer and Circular are amended to refer to “5:00 p.m. (Toronto time) on May 27, 2014”.

 

2.                                      Time for Acceptance

 

The Offer is now open for acceptance until 5:00 p.m. (Toronto time) on May 27, 2014. Shareholders who have validly deposited and not withdrawn their Augusta Shares need take no further action to accept the Offer.  If, at the time immediately prior to 5:00 p.m. (Toronto time) on May 27, 2014, all of the conditions of the Offer are satisfied or waived by the Offeror, then the Initial Offering Period will end at such time and all Augusta Shares deposited under the Offer and not withdrawn will be taken up by the Offeror.  If any Augusta Shares are taken up under the Offer, the Offer will be extended and remain open for the deposit of Augusta Shares for not less than ten days from the date on which Augusta Shares are first taken up, which extended period will be a Subsequent Offering Period.

 

3.                                      Manner of Acceptance

 

Augusta Shares may be deposited to the Offer in accordance with the provisions of Section 3 of the Original Offer, “Manner of Acceptance”.

 

4.                                     Take-Up of and Payment for Deposited Augusta Shares

 

If all the conditions of the Offer have been satisfied or waived by the Offeror, the Offeror will take up Augusta Shares validly deposited under the Offer and not properly withdrawn no later than 9:00 a.m. on the first business day following the end of the Initial Offering Period.  The Offeror will pay for Augusta Shares taken up as soon as practicable thereafter and in any event within three business days thereafter.  By so taking up and paying for Augusta Shares validly deposited under the Offer and not properly withdrawn, the Offeror will comply with the requirement under Canadian law to take up such Augusta Shares within ten days following the end of the Initial Offering Period and paying for such shares within three business days thereafter. See Section 6 of the Original Offer, “Take Up of and Payment for Deposited Augusta Shares”.

 

5.                                      Withdrawal of Deposited Augusta Shares

 

Augusta Shares deposited under the Offer may be withdrawn by or on behalf of the depositing Augusta Shareholder at any time before the Augusta Shares have been taken up by the Offeror under the Offer (including during any Subsequent Offering Period) and in the other circumstances described in Section 8 of the Original Offer,

 

 

“Withdrawal of Deposited Augusta Shares”. Except as so indicated or as otherwise required or permitted by applicable Laws, deposits of Augusta Shares are irrevocable.

 

6.                                      Consequential Amendments to the Original Offer and Circular and Other Documents

 

The Original Offer and Circular, Letter of Transmittal and Notice of Guaranteed Delivery shall be read together with this Notice of Variation and Extension and are hereby amended to the extent necessary to reflect the amendments contemplated by, and the information contained in, this Notice of Variation and Extension.

 

Except as otherwise set forth in or amended by this Notice of Variation and Extension, the terms and conditions of the Offer and the information in the Original Offer and Circular, the Letter of Transmittal and the Notice of Guaranteed Delivery continue to be applicable in all respects.

 

7.                                      Statutory Rights

 

Securities legislation in the provinces and territories of Canada provides security holders of Augusta with, in addition to any other rights they may have at law, one or more rights of rescission, price revision or to damages, if there is a misrepresentation in a circular or a notice that is required to be delivered to those security holders. However, such rights must be exercised within prescribed time limits. Security holders should refer to the applicable provisions of the securities legislation of their province or territory for particulars of those rights or consult with a lawyer.

 

8.                                      Directors’ Approval

 

The contents of this Notice of Variation and Extension have been approved, and the sending thereof to the Augusta Shareholders has been authorized by the Hudbay Board of Directors.

 

 

APPROVAL AND CERTIFICATE OF HUDBAY MINERALS INC.

 

The foregoing, together with the Original Offer and Circular, contains no untrue statement of a material fact and does not omit to state a material fact that is required to be stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made.

 

Dated: May 16, 2014.

 

 

	
(Signed) DAVID GAROFALO
    	
 
    	
(Signed) DAVID S. BRYSON
    
	
 
    	
 
    	
 
    
	
President and Chief   Executive Officer
    	
 
    	
Senior Vice President and   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
On behalf of the Board of   Directors
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(Signed) G. WESLEY VOORHEIS
    	
 
    	
(Signed) SARAH B. KAVANAGH
    
	
Director
    	
 
    	
Director
    

 

 

The Depositary for the Offer is:

 

 

By Registered Mail, Mail, Hand or Courier

 

Toronto

200 University Avenue 
 Suite 300
 Toronto, Ontario

M5H 4H1

Attention:  Corporate Actions

 

Inquiries

 

North American Toll Free:  1-866-393-4891

Telephone:  416-361-0930 ext. 205

Facsimile:  416-361-0470

E-Mail:  corporateactions@equityfinancialtrust.com

 

THE INFORMATION AGENT FOR THE OFFER IS:

 

 

The Exchange Tower

130 King Street West, Suite 2950, P.O. Box 361

Toronto, Ontario M5X 1E2

North American Toll Free Phone:

1-866-229-8874

E-mail: contactus@kingsdaleshareholder.com

Facsimile: 416-867-2271

Toll Free Facsimile: 1-866-545-5580

Outside North America, Banks and Brokers Call Collect: 416-867-2272

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