TORONTO – Based on recommendations received from Institutional Shareholders Services Inc. and the special committee constituted to consider and deal with such matters, the Maple Leaf Foods board of directors has amended the shareholders' rights plan that was previously adopted on July 28. The special committee consists of all of the company directors independent of Michael McCain, the president and CEO, and McCain Capital Corporation.
Amendments to the rights plan encompass three following matters:
- To prevent an accidental triggering of the plan, the definition of "Acquiring Person" has been revised to enable a person who was the beneficial owner of 20 percent or more of the common shares at the time the plan was implemented to acquire an additional 1 percent of the company's shares, exclusive of other exemptions under the rights plan, without triggering the rights plan.
- The definition of "Exempt Acquisition" has been changed to cap the number of shares that can be issued or distributed to grandfathered persons under equity incentive stock plans of the company, exclusive of other exemptions under the rights plan, to no more than 2.5 percent in aggregate after the date hereof without triggering the rights plan.
- The definition of "Permitted Lock-Up Agreement" has been modified to allow a locked-up person to withdraw shares from a locked-up bid in order to support another bid or transaction that provides for a greater consideration than the lock-up bid, regardless of the number of shares involved (i.e., a partial bid).
This amended rights plan is now in effect, subject to confirmation through a vote of shareholders at the company's special meeting of shareholders to be held in Toronto on Dec. 14.
TSX will continue to defer its approval of the rights plan, as amended, until such time as shareholders have ratified it.