| Tue 26 Aug 2008, 9:00 | | RDI - Rockwell Diamonds Incorporated - Notice Of Annual And Special General |
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RDI
RDI
RDI - Rockwell Diamonds Incorporated - Notice Of Annual And Special General
Meeting Of Shareholders
ROCKWELL DIAMONDS INCORPORATED
(A company incorporated in accordance with the laws of British Columbia,
Canada)
(Incorporation number BCO354545)
(Formerly Rockwell Ventures Inc.)
(South African registration number: 2007/031582/10)
Share code on the JSE Limited: RDI ISIN: CA77434W1032
Share code on the TSX: RDI CUSIP Number: 77434W103
Share code on the OTCBB: RDIAF
("the Company")
Telephone No.: (604) 684-6365 Fax No.: (604) 684-8092
NOTICE OF ANNUAL AND SPECIAL GENERAL MEETING OF SHAREHOLDERS
TAKE NOTICE that the Annual and Special General Meeting (the "Meeting") of
Shareholders of the Company will be held at the offices of McCarthy Tetrault,
5 Old Bailey, 2nd Floor, London, EC4M 7BA, England, on September 15, 2008, at
2:00p.m, BST, for the following purposes:
Annual General Meeting Matters
1. To receive and consider the financial statements of the Company for its
fiscal year ended February 29, 2008, together with the auditor`s report
thereon.
2. To elect directors of the Company for the ensuing year.
3. To appoint an auditor of the Company for the ensuing year.
Special Meeting Matters
1. Share Option Plan - To consider and approve a new form of share option
plan pursuant to the policies of the TSX Exchange.
2. Shareholder Rights Plan - To consider and approve a shareholder rights
plan, as more particularly set out in the Information Circular
prepared for the Meeting. .
An Information Circular accompanying this Notice was mailed to shareholders
and posted SEDAR on 19 August 2008. The Information Circular contains
details of matters to be considered at the Meeting.
Registered shareholders who are unable to attend the Meeting in person and
who wish to ensure that their shares will be voted at the Meeting are
requested to complete, date and sign the enclosed form of proxy or complete
another suitable form of proxy and deliver it by fax, by hand or by mail in
accordance with the instructions set out in the form of proxy and in the
Information Circular.
Non-registered shareholders who plan to attend the Meeting must follow the
instructions set out in the voting instruction form and in the Information
Circular to ensure that their shares will be voted at the Meeting.
THE FOLLOWING INFORMATION APPLIES TO THOSE SHAREHOLDERS REGISTERED ON THE
SOUTH AFRICAN REGISTER:
If shareholders have dematerialised their shares with a CSDP or broker, other
than own name dematerialised shareholders, they must arrange with the CSDP or
broker concerned to provide them with the Letter of Representation to attend the
Meeting and vote thereat or the shareholder concerned must instruct their CSDP
or broker as to how they wish to vote in this regard. This must be done in terms
of the agreement entered into between the shareholder and the CSDP or broker
concerned, in the manner and cut-off time stipulated therein.
DATED at Vancouver, British Columbia, August 15, 2008.
BY ORDER OF THE BOARD
Dr. John Bristow
President and Chief Executive Officer
PARTICULARS OF OTHER MATTERS TO BE ACTED UPON
A. Share Option Plan
The Shares were listed on the TSX on February 22, 2008. In order to comply
with the policies of the TSX, and to provide incentive to directors, officers,
employees, management and others who provide services to the Company or any
subsidiary to act in the best interests of the Company, the directors approved
a new form of share option plan (the "New Option Plan") on August 14, 2008.
The TSX has approved the New Option Plan, subject to shareholder approval.
Pursuant to the policies of the TSX the New Option Plan requires shareholder
approval at every third annual meeting of the Company by ordinary resolution.
Under the New Option Plan, a maximum of 10% of the issued and outstanding
shares at the time an option is granted, less shares reserved for issuance on
exercise of options then outstanding in the New Option Plan, are reserved for
options to be granted at the discretion of Board to eligible optionees (the
"Optionees"). This type of share option plan is called a "rolling" plan.
At the date of this Circular, options to purchase an aggregate of 8,459,500
shares were outstanding, representing approximately 3.5% of shares outstanding.
The New Option Plan is subject to restrictions that: (i) the number of shares
issuable to Insiders as a group under the New Option Plan, when combined with
shares issuable to Insiders under all the Company`s other security based
compensation plans may not exceed 10% of the issued shares within any 12 month
period; (ii) the number of shares issuable to Insiders as a group under the New
Option Plan, when combined with shares issuable to Insiders under all the
Company`s other security based compensation plans, may not exceed 10% of the
Company`s issued shares; and (iii) no exercise price of an option granted to an
Insider may be reduced nor an extension to the term of an option granted to an
Insider extended without further approval of the disinterested shareholders of
the Company.
Options under the New Option Plan must be granted at the five day volume
weighted average trading price of the shares, which is calculated by dividing
the total value of the securities traded for the relevant period by the total
volume. Where appropriate, the TSX may exclude internal crosses and certain
other special terms trades from the calculation.
Material Terms of the Plan
The following is a summary of the material terms of the New Option Plan:
(a) currently all options granted under the New Option Plan are non-assignable
and non-transferable for a period of up to five years;
(b) for stock options granted to employees or service providers (inclusive of
management company employees), the Company must ensure that the proposed
optionee is a bona fide employee or service provider (inclusive of
management company employees), as the case may be of the Company or any
subsidiary;
(c) if an optionee ceases to be employed by the Company (other than as a result
of termination with cause) or ceases to act as a director or officer of the
Company or a subsidiary of the Company, any option held by such optionee
may be exercised within 90 days after the date of such optionee ceases to
be employed as an officer or director or, as the case may be;
(d) if an optionee dies, any vested option held by him at the date of death
will become exercisable by the optionee`s lawful. Personal representatives,
heirs of executors until the earlier of one year after the date of death of
such optionee and the date of expiration of the terms otherwise applicable
to such option;
(e) in the case of an optionee being dismissed from employment or service for
cause, such optionee`s options, whether or not vested at the date of
dismissal, will immediately terminate with right to exercise same;
(f) the minimum exercise price of an option granted under the New Option Plan
must not be less than the market price calculated the day before the grant
(as defined in the New Option Plan);
(g) vesting of options shall be in accordance with the option commitment in the
New Option Plan or otherwise, at the discretion of the Board, and will
generally be subject to: (i) the service provider remaining employed by or
continuing to provide services to the Company or any of its affiliates as
well as, at the discretion of the Board, achieving certain milestones which
may be defined by the Board from time to time or receiving a satisfactory
performance review by the Company or any of its affiliates during the
vesting period or (ii) the service provider remaining as a Directors of the
Company or any of its affiliates during the vesting period;
(h) the maximum aggregate number of shares issuable upon exercise of options to
non-employee directors must not exceed 1% of the total common shares of the
Company outstanding at any time and no more than $100,000 in total award
value per non-employee director on an annual calendar basis; and
(i) the Board reserves the right in its absolute discretion to terminate the
New Option Plan with respect to all New Option Plan shares in respect of
Options which have not yet been granted hereunder.
The Company is of the view that the New Option Plan provides the Company
with the flexibility necessary to attract and maintain the services of senior
executives and other employees and reflects in competing compensation to other
companies in the industry.
The Board has determined that, in order to reasonably protect the rights of
the participants, certain amendments should be made to the current share
option plan. In addition, as a matter of administration, the Board has
determined that it is necessary to clarify when amendments to the New Option
Plan may be made by the Board without further shareholder approval.
Accordingly, the Board proposes that the New Option Plan provide that:
(a) All outstanding but unvested options will vest immediately prior to
completion of a Change in Control (as defined in the New Option Plan);
(b) If an option which has been previously granted is set to expire during a
period in which trading in securities of the Company by any New Option Plan
participant is restricted by a black-out, or any such black-out extends to
a date which is within five business days of the expiry of the option, the
exercise date will be extended to ten business days after the trading
restrictions are lifted; and
(c) The New Option Plan and outstanding options may be amended by the Board
without shareholder approval in the following circumstances:
(i) it may make amendments which are of a typographical, grammatical or
clerical nature only;
(ii) it may change the vesting provisions of an option or the New Option Plan;
(iii)it may change the termination provision of an option or the New Option Plan
which does not entail an extension beyond the original Expiry Date of an Option;
(iv)it may add a cashless exercise feature payable in cash or shares to the New
Option Plan;
(v)it may make amendments necessary as a result of changes in securities laws
applicable to the Company;
(vi) if the Company becomes listed or quoted on a stock exchange or stock market
senior to the TSX, it may make such amendments as may be required by the
policies of such senior stock exchange or stock market; and
(vii)it may make such amendments as reduce, and do not increase, the benefits of
the New Option Plan to potential optionees.
The full text of the New Option Plan will be filed prior to the Meeting at
SEDAR.com and will be available for download at www.sedar.com. As well, a
copy of the New Option Plan will be available for inspection at the Meeting.
In accordance with the policies of the TSX, the New Option Plan must be
approved by a majority of the votes cast at the Meeting. At the Meeting,
shareholders will be asked to vote on the new Option Plan resolution, with or
without variation, as set forth on Schedule "A" hereto. The Board recommends
that shareholders vote in favour of the amendments to the New Option Plan.
B. Shareholder Rights Plan
The Board adopted a shareholder rights plan agreement (the "Rights Plan")
effective April 14, 2008 (the "Effective Date"). The objective of the Board
in adopting the Rights Plan is to ensure the fair treatment of Shareholders in
connection with any take-over bid for the Company Shares. The Rights Plan was
not adopted in response to any proposal to acquire control of the Company.
The principal terms of the Rights Plan are summarized below. The full text of
the Rights Plan was filed in a Material Change Report dated April 14, 2008, and
which is available for download at www.SEDAR.com. As well, a copy of the Rights
Plan will be available for inspection at the Meeting.
Purpose of Rights Plan
The primary objective of the Rights Plan is to ensure that all shareholders of
the Company are treated fairly in connection with any take-over bid for the
Company by (a) providing shareholders with adequate time to properly assess a
take-over bid without undue pressure and (b) providing the Board with more time
to fully consider an unsolicited take-over bid, and, if applicable, to explore
other alternatives to maximize shareholder value.
Summary of Rights Plan
The following summary of the Rights Plan does not purport to be complete and is
qualified in its entirety by reference to the Rights Plan.
Issue of Rights
The Company will issue one right (a "Right") in respect of each Common Share
outstanding as at April 14, 2008, 2008 (the "Record Time"). The Company will
issue Rights on the same basis for each Common Share issued after the Record
Time but prior to the earlier of the "Separation Time" and the "Expiration Time"
(both terms defined below).
The Rights
Each Right will entitle the holder, subject to the terms and conditions of the
Rights Plan, to purchase additional Company Shares after the Separation Time.
Rights Certificates and Transferability
Before the Separation Time, the Rights will be evidenced by certificates for
the shares, and are not transferable separately from the shares. From and after
the Separation Time, the Rights will be evidenced by separate Rights
Certificates, which will be transferable separately from and independent of
the shares.
Exercise of Rights
The Rights are not exercisable before the Separation Time. After the
Separation Time and before the Expiration Time, each Right entitles the
holder to acquire one Common Share for the exercise price of $50 (subject to
certain anti-dilution adjustments). This exercise price is expected to be in
excess of the estimated maximum value of the shares during the term of the
Rights Plan. Upon the occurrence of a Flip-In Event (defined below) prior to
the Expiration Time (defined below), each Right (other than any Right held by an
"Acquiring Person", which will become null and void as a result of such Flip-In
Event) may be exercised to purchase that number of shares which have an
aggregate market price equal to twice the exercise price of the Rights for a
price equal to the exercise price (subject to adjustment). Effectively, this
means a shareholder of the Company (other than the Acquiring Person) can acquire
additional shares from treasury at half their market price.
Definition of "Acquiring Person"
Subject to certain exceptions, an Acquiring Person is a person who becomes the
Beneficial Owner (defined below) of 20% or more of the Company`s outstanding
shares.
Definition of "Beneficial Ownership"
A person is a Beneficial Owner of securities if such person or its affiliates or
associates or any other person acting jointly or in concert with such person,
owns the securities in law or equity, and has the right to acquire (immediately
or within 60 days) the securities upon the exercise of any convertible
securities or pursuant to any agreement, arrangement or understanding.
However, a person is not a Beneficial Owner under the Rights Plan where:
(a) the securities have been deposited or tendered pursuant to a tender or
exchange offer or take-over bid, unless those securities have been taken up
or paid for;
(b) such person has agreed to deposit or tender the securities to a take-over
bid pursuant to a permitted lock-up agreement;
(c) such person (including a fund manager, trust company, pension fund
administrator, trustee or non-discretionary client accounts of registered
brokers or dealers) is engaged in the management of mutual funds,
investment funds or public assets for others, as long as that person:
(i) holds those shares in the ordinary course of its business for the account
of others;
(ii) is not making a take-over bid or acting jointly or in concert with a person
who is making a take-over bid; or
(iii)such person is a registered holder of securities as a result of carrying on
the business of or acting as a nominee of a securities depository.
Definition of "Separation Time"
Separation Time occurs on the tenth trading day after the earlier of:
(a) the first date of public announcement that a person has become an Acquiring
Person;
(b) the date of the commencement or announcement of the intent of a person to
commence a take-over bid (other than a Permitted Bid or Competing Permitted
Bid); and
(c) the date on which a Permitted Bid or Competing Permitted Bid ceases to
qualify as such;
or such later date as determined by the Board.
Definition of "Expiration Time"
Expiration Time occurs on the date being the earlier of:
(a) the time at which the right to exercise Rights is terminated under the
terms of the Rights Plan;
(b) immediately after the Company`s annual meeting of shareholders to be held
in 2010 unless at such meeting the duration of the Rights Plan is extended;
and
(c) 180 days after the date of the Rights Plan if the Rights Plan is not
ratified by shareholders in accordance with the requirements of the TSX.
Definition of a "Flip-In Event"
A Flip-In Event occurs when a person becomes an Acquiring Person, provided
the Flip-In Event is deemed to occur at the close of business on the 10th
day after the first date of a public announcement of facts indicating that
an Acquiring Person has become such. Upon the occurrence of a Flip-In Event,
any Rights that are beneficially owned by an Acquiring Person, or any of its
related parties to whom the Acquiring Person has transferred its Rights, will
become null and void and, as a result, the Acquiring Person`s investment in the
Company will be greatly diluted if a substantial portion of the Rights are
exercised after a Flip-In Event occurs.
Definition of "Permitted Bid"
A Permitted Bid is a take-over bid made by a person (the "Offeror") pursuant
to a take-over bid circular that complies with the following conditions:
(a) the bid is made to all registered holders of shares (other than the
Offeror);
(b) the Offeror agrees that no shares will be taken up or paid for under the
bid for at least 60 days following the commencement of the bid and that no
shares will be taken up or paid for unless at such date more than 50% of
the outstanding shares held by shareholders, other than the Offeror and
certain related parties, have been deposited pursuant to the bid and not
withdrawn;
(c) the Offeror agrees that the shares may be deposited to and withdrawn from
the take-over bid at any time before such shares are taken up and paid for;
and
(d) if, on the date specified for take-up and payment, the condition in
paragraph (b) above is satisfied, the bid shall remain open for an
additional period of at least 10 business days to permit the remaining
shareholders to tender their shares.
Definition of "Competing Permitted Bid"
A Competing Permitted Bid is a take-over bid that:
(a) is made while another Permitted Bid or Competing Permitted Bid has been
made and prior to the expiry of that Permitted Bid or Competing Permitted
Bid;
(b) satisfies all the requirements of a Permitted Bid other than the
requirement that no shares will be taken up or paid for under the bid for
at least 60 days following the commencement of the bid and that no shares
will be taken up or paid for unless at such date more than 50% of the
outstanding shares held by shareholders, other than the Offeror and certain
related parties, have been deposited pursuant to the bid and not withdrawn;
and
(c) contains the conditions that no shares be taken up or paid for pursuant to
the Competing Permitted Bid prior to the close of business on a date that
is not earlier than the later of 35 days after the date of the Competing
Permitted Bid and the earliest date on which the shares may be taken up or
paid for under any prior bid in existence at the date of such Competing
Permitted Bid; and then only if, at the time that such shares are first
taken up or paid for, more than 50% of then outstanding shares held by
shareholders, other than the Offeror and certain related parties, have
been deposited pursuant to the Competing Permitted Bid and not withdrawn.
Redemption of Rights
All (but not less than all) of the Rights may be redeemed by the Board with
the prior approval of the Shareholders at any time before a Flip-In Event
occurs at a redemption price of $0.0001 per Right (subject to adjustment). In
addition, in the event of a successful Permitted Bid, Competing Permitted Bid
or a bid for which the Board has waived the operation of the Rights Plan, the
Company will immediately upon such acquisition and without further formality,
redeem the Rights at the redemption price. If the Rights are redeemed pursuant
to the Rights Plan, the right to exercise the Rights will, without further
action and without notice, terminate and the only right thereafter of the Rights
holders is to receive the redemption price.
Waiver
Before a Flip-In Event occurs, the Board may waive the application of the
"Flip-In" provisions of the Rights Plan to any prospective Flip-In Event which
would occur by reason of a take-over bid made by a take-over bid circular to
all registered holders of shares. However, if the Board waives the Rights Plan
with respect to a particular bid, it will be deemed to have waived the Rights
Plan with respect to any other take-over bid made by take-over bid circular to
all registered holders of shares before the expiry of that first bid. The Board
may also waive the "Flip-In" provisions of the Rights Plan in respect of any
Flip-In Event provided that the Board has determined that the Acquiring Person
became an Acquiring Person through inadvertence and has reduced its ownership to
such a level that it is no longer an Acquiring Person.
Term of the Rights Plan
Unless otherwise terminated, the Rights Plan will expire at the Expiration
Time (defined above).
Amending Power
Except for amendments to correct clerical or typographical errors and
amendments to maintain the validity of the Rights Plan as a result of a
change of applicable legislation or applicable rules or policies of securities
regulatory authorities, Shareholder (other than the Offeror and certain related
parties) or Rights holder majority approval is required for supplements or
amendments to the Rights Plan. In addition, any supplement or amendment to the
Rights Plan will require the written concurrence of the Rights Agent and prior
written consent of the TSX.
Rights Agent
The Rights Agent under the Rights Plan is Computershare Investor Services
Inc.
Rights Holder not a Shareholder
Until a Right is exercised, the holders thereof as such, will have no
rights as a Shareholder of the Company.
In accordance with the policies of the TSX, the Rights Plan must be approved by
a majority of the votes cast at the Meeting within 180 days of the adoption by
the Board`s of the Rights Plan.
At the Meeting, shareholders will be asked to vote on resolution, set forth on
Schedule "A" in connection with the Shareholder Rights Plan. The Board of
recommends that Shareholders vote in favour of the ratification and approval of
the Rights Plan.
ADDITIONAL INFORMATION
The audited consolidated financial statements of the Company for the nine
months period ended February 29, 2008, the report of the auditor thereon and
the management discussion and analysis will be placed before the Meeting.
Additional copies may be obtained free of charge from the Secretary of the
Company upon request and will be available at the Meeting. Additional
information and copies of documents referenced herein may be obtained from SEDAR
at www.sedar.com and upon request from the Company`s Investor Relations
department at Suite 1020 - 800 West Pender Street, Vancouver, British Columbia,
V6C 2V6, telephone number: 604-684-6365 or fax number 604-681-2741.
OTHER MATTERS
The Board is not aware of any other matters which it anticipates will come
before the Meeting as of the date of mailing of this Circular.
The contents of this Circular and its distribution to shareholders have been
approved by the Board.
DATED at Vancouver, British Columbia, August 15, 2008.
BY ORDER OF THE BOARD
Dr. John Bristow
President and Chief Executive Officer
SCHEDULE "A"(to the Circular of the Company dated August 15, 2008)
TEXT OF RESOLUTIONS
Resolution 1
Ratification of New Option Plan Resolution
Resolved, with or without amendment, that:
1 the New Option Plan dated for reference August 14, 2008, as approved by the
Board on August 14, 2008, which provides for the Company to grant options
up to 10% of the issued and outstanding shares of the Company at any time
to its directors, employees, officers, and consultants, all as more
particularly described in the Circular of the Company dated as of August
154, 2008, be ratified and approved;
2 all outstanding options be rolled into the New Option Plan;
3 the Company be authorized to abandon all or any part of the New Option Plan
if the Board deems it appropriate and in the best interests of the Company
to do so;
4 any one or more of the directors and officers of the Company be authorized
to perform all such acts, deeds and things and execute, under seal of the
Company or otherwise, all such documents as may be required to give effect
to this resolution; and
5 all unallocated entitlements under the New Option Plan be approved until
September 15, 2011
Resolution 2
Ratification of Shareholders Rights Plan Agreement
Resolved, with or without amendment, that:
1 the Shareholder Rights Plan Agreement dated as of April 14, 2008 and as
described in the Circular of the Company be hereby ratified and approved;
2 The Company be authorized to abandon the Shareholder Rights Plan Agreement
if the Board deems it appropriate and in the best interests of the Company
to do so; and
3 any one or more of the directors and officers of the Company be authorized
to perform all such acts, deeds and things and execute, under seal of the
Company or otherwise, all such documents as may be required to give effect
to this resolution.
Johannesburg
26 August 2008
Sponsor
Sasfin Capital
(A division of Sasfin Bank Limited)
Date: 26/08/2008 09:00:01 Produced by the JSE SENS Department.
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