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Copyright 2000: Queen’s Printer,
St. John's, Newfoundland and Labrador, Canada

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Revised Statutes of Newfoundland 1990


CHAPTER F-15

AN ACT RESPECTING THE RETURN OF THE BUSINESS OF FISHERY PRODUCTS INTERNATIONAL LIMITED TO PRIVATE INVESTORS

Analysis

1. Short title

2. Definitions

3. Agreement ratified

4. Holding company ownership restricted

5. Operating company ownership restricted

6. Foreign continuance prohibited

7. Sale of business restricted

8. Effect of amalgamation, etc.

9. Residency requirement

10. Management director

11. Act prevails

Schedule A

Schedule B


Short title

1. This Act may be cited as the Fishery Products International Limited Act.

1987 c35 s1

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Definitions

2. In this Act

(a) "FPI Limited" means the body corporate continued under the laws of the province on December 19, 1986; and

(b) "Fishery Products International Limited" means the body corporate formed by amalgamation under the laws of the province on December 31, 1984.

1987 c35 s2

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Agreement ratified

3. The Agreement executed and delivered by and between the government of the province, the Government of Canada and Fishery Products International Limited and set out in Schedule A to this Act is ratified, confirmed and adopted from April 15, 1987, and has the full force and effect of law for all purposes as if expressly enacted in this Act.

1987 c35 s3

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Holding company ownership restricted

4. The provisions set out in Schedule B to this Act shall form a part of the constating instruments of FPI Limited and shall not be amended or revoked by FPI Limited.

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Operating company ownership restricted

5. (1) The provisions set out in Schedule B to this Act shall form a part of the constating instruments of Fishery Products International Limited and shall not be amended or revoked by Fishery Products International Limited.

(2) The provisions set out in Schedule B to this Act as they form part of the constating instruments of Fishery Products International Limited shall not apply to FPI Limited.

1987 c35 s5

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Foreign continuance prohibited

6. Neither FPI Limited nor Fishery Products International Limited may apply to the appropriate official of a public body of another jurisdiction requesting continuance under the laws of that jurisdiction.

1987 c35 s6

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Sale of business restricted

7. (1) Neither FPI Limited nor Fishery Products International Limited shall sell, lease, exchange or otherwise dispose of all or substantially all of its property or business which relates to the harvesting, processing and marketing of seafood.

(2) Notwithstanding subsection (1), FPI Limited and Fishery Products International Limited may mortgage, pledge, charge or otherwise encumber their assets to secure their obligations.

1987 c35 s7

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Effect of amalgamation, etc.

8. The provisions of this Act which apply to FPI Limited or Fishery Products International Limited shall also apply to a successor corporation of FPI Limited or Fishery Products International Limited whether formed by way of amalgamation, arrangement or otherwise.

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Residency requirement

9. A majority of the members of the board of directors of each of FPI Limited and Fishery Products International Limited shall be residents of the province.

1987 c35 s9

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Management director

10. Only 1 member of the management of FPI Limited or Fishery Products International Limited shall be a director of either FPI Limited or Fishery Products International Limited.

1987 c35 s10

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Act prevails

11. Where there is a conflict between this Act and

(a) The Companies Act;

(b) the Corporations Act;

(c) the constating instruments of FPI Limited; or

(d) the constating instruments of Fishery Products International Limited,

this Act prevails.

1987 c35 s11

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SCHEDULE "A"

AGREEMENT AMONG THE GOVERNMENT OF CANADA AND THE GOVERNMENT OF NEWFOUNDLAND AND LABRADOR AND FISHERY PRODUCTS INTERNATIONAL LIMITED CONCERNING FISHERY PRODUCTS INTERNATIONAL LIMITED

February 12, 1987

WHEREAS:

(a) the governments entered into an Agreement (the "Newfoundland Fishery Restructuring Agreement") dated September 26, 1983 to carry out certain common objectives with respect to the restructuring of the fishing industry in the Province of Newfoundland and for this purpose to create a company whose primary objective was to strengthen the Newfoundland fishery and that was economically viable, efficient and modernized so that it would be highly competitive especially in international markets;

(b) one of the objectives of the restructuring was to pursue divestiture to the private sector of both governments' ownership in the company as soon as possible;

(c) Fishery Products International Limited ("FPIL") is the operating company referred to in the Newfoundland Fishery Restructuring Agreement formed to meet the foregoing objectives;

(d) FPIL has met the foregoing objectives for the company set forth in the Newfoundland Fishery Restructuring Agreement;

(e) the governments and FPIL have discussed and agreed upon a corporate reorganization and public share offering which will have the effect of returning the business of FPIL to the private sector and will give the employees of FPIL a significant interest in FPIL through a profit sharing plan and a grant of treasury shares from FPIL's holding company, FPI Limited; and

(f) the continued application of a number of provisions of the Newfoundland Fishery Restructuring Agreement to FPIL and FPI Limited and FPI Limited's shareholders would be inconsistent with FPIL being owned by the private sector.

NOW THEREFORE THIS AGREEMENT WITNESSETH that for and in consideration of the mutual covenants and agreements hereinafter contained and all other consideration herein mentioned:

1. The parties hereto covenant and agree that from and after the date upon which FPI Limited first issues shares to the public the provisions contained in Clauses 2, 3, 4, 5, 7, 8, 9 and 11 of the Newfoundland Fishery Restructuring Agreement shall not in any way apply to or bind FPIL or FPI Limited or FPI Limited's shareholders, and the words "the plant at St. Anthony and" shall be deleted from paragraph 15(b) of the Newfoundland Fishery Restructuring Agreement.

2. This Agreement may be executed in one or more counterparts each of which shall be considered an original and all of which together shall be treated as one document.

IN WITNESS WHEREOF the parties hereto have executed this agreement as of the day and year first above written.

SIGNED, on behalf of Newfoundland )
by- )
)
)
)
) _____________________
)

SIGNED, on behalf of Canada )
by - )
)
)
)
) _____________________
)

FISHERY PRODUCTS
INTERNATIONAL
LIMITED

By: _________________

_________________

1987 c35 Sch A

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SCHEDULE "B"

ARTICLE 13 OF FPI LIMITED AND FISHERY PRODUCTS INTERNATIONAL LIMITED

"13. (a)Except for Underwriters holding Voting Securities in the course of a distribution to the public or for market making activities coincident with such distribution, and nominees or bare trustees holding Voting Securities, no holder of Voting Securities and associates of such holder shall hold in aggregate Voting Securities to which are attached in excess of 15% of the total number of votes attached to all Voting Securities then issued and outstanding.

(b) The Company shall (A) refuse any subscription for Voting Securities, and (B) refuse to register in the Register of Holders of Voting Securities, or otherwise recognize, any transfer of Voting Securities, if

(i) the subscriber and associates thereof or the transferee and associates thereof, as the case may be, would after such subscription or transfer, hold Voting Securities entitling the holder or holders thereof to vote more than 15% of the total number of votes attached to all the Voting Securities then issued and outstanding; or

(ii) the subscriber, at the time of subscription, or the transferee, when requesting registration, fails to provide a duly completed and executed declaration of such subscriber or transferee, as the case may be, in the form prescribed from time to time by the Company, establishing, to the satisfaction of the Company, that such subscriber and associates thereof or such transferee and associates thereof, as the case may be, would not, after such subscription or transfer, hold Voting Securities entitling the holder or holders thereof to vote more than 15% of the total number of votes attached to all the Voting Securities then issued and outstanding.

Notwithstanding the foregoing, no declaration need be provided in respect of any subscription for or transfer of a number of Voting Securities that is less than might reasonably be expected to give rise to a contravention of the provisions of this Article 13, such number to be determined by the board of directors from time to time as to any particular class of Voting Securities; and until such a determination, the number as to common shares shall be 5,000 shares or less.

(c) The Company shall (A) sell or cause to be sold, for and on behalf of the holder there of, all or a portion of the Voting Securities of the holder, or (B) repurchase or redeem, in accordance with any applicable laws now or hereafter in effect, all or a portion of the Voting Securities of a holder, as the case may be, if the total number of Voting Securities held by the holder and any associates thereof entitle the holders thereof to vote more than 15% of the total number of votes attached to all Voting Securities then issued and outstanding in order to reduce the aggregate number of Voting Securities held by the holder and any associates thereof to a number which would entitle the holder and any associates thereof to vote 15% of the total number of votes attached to Voting Securities then issued and outstanding.

Before selling or causing to be sold or repurchasing or redeeming Voting Securities in accordance with this paragraph 13(c), the Company shall give notice to the holder of its intention to sell, repurchase or redeem such Voting Securities and notwithstanding the previous provisions of this paragraph 13(c), in the event that the holder establishes to the satisfaction of the Company within 30 days of the giving of such notice that the holder and any associates thereof have sold or caused to be sold (to a person or persons who after such sale would not hold Voting Securities in contravention of this Article 13) sufficient Voting Securities so that the aggregate number of Voting Securities then held by the holder and any associates thereof does not exceed that number which would entitle the holder and any associates thereof to vote 15% of the total number of votes attached to all Voting Securities then issued and outstanding, the Company shall not be required to sell, repurchase or redeem Voting Securities.

(d) The Company shall (A) sell or cause to be sold for and on behalf of the holder thereof, all or a portion of the Voting Securities of a holder, or (B) repurchase or redeem, in accordance with any applicable laws now or hereafter in effect, all or a portion of the Voting Securities of a holder if the Company has mailed, by prepaid first class mail to the address of the registered holder of the Voting Securities shown on the Register of Holders of Voting Securities for such Voting Securities, the form of declaration then prescribed by the Company and has not received (with respect to such Voting Securities) on or before the 45th day after the date of mailing thereof (or such later date as the Company may prescribe in the declaration) such declaration duly completed and executed by such registered holder, establishing, to the satisfaction of the Company, that the total number of votes attached to the Voting Securities held by the holder and associates thereof does not exceed 15% of the total number of votes attached to all Voting Securities then issued and outstanding.

Notwithstanding the provisions of this paragraph 13(d), in the event that, prior to the Company initiating the sale, repurchase or redemption of Voting Securities pursuant to this paragraph 13(d), a holder establishes to the satisfaction of the Company that the failure to provide the declaration referred to duly completed and executed was due to inadvertence or any other cause reasonably beyond the control of the holder, the Company may grant such holder an additional 15 days from the date when such information is provided to the Company to permit the holder to file the prescribed declaration.

(e) The Directors of the Company shall have the power to determine, which determination shall be final and binding upon all holders of Voting Securities,

(i) whether a subscriber and associates thereof or a transferee and any associates thereof would, after such a subscription or transfer, hold Voting Securities entitling the holders thereof to vote more than 15% of the total number of votes attached to all Voting Securities then issued and outstanding; and

(ii) whether any holder and any associates thereof hold Voting Securities entitling the holders thereof to vote more than 15% of the total number of votes attached to all Voting Securities then issued and outstanding.

(f) Upon the sale, repurchase or redemption of any Voting Securities pursuant to the provisions of this Article 13, the rights of the former holder of such Voting Securities shall be limited to the right to receive the sale, repurchase or redemption proceeds, as the case may be, upon presentation and surrender of the certificate representing the Voting Securities sold, repurchased or redeemed, and any purchaser of Voting Securities sold, repurchased or redeemed pursuant to the provisions of this Article 13 shall acquire such Voting Securities free of any claims of such former holder in respect of such sale, repurchase or redemption. Such proceeds will be deposited by the Company in an account with a chartered bank or trust company for such former holder and any interest earned on such funds so held will accrue to the benefit of such former holder.

(g) The sale proceeds of Voting Securities sold pursuant to the provisions of this Article 13 shall be the net proceeds (after deductions permitted by this Article 13) received on the sale of such Voting Securities on the stock exchange designated by the Directors of the Company or, if such Voting Securities are not listed or are not trading on a stock exchange, the net proceeds which result from a sale made in such other manner as the Directors of the Company may determine.

(h) The repurchase or redemption price for each Voting Security repurchased or redeemed pursuant to the provisions of this Article 13 shall be the average of the closing prices per Voting Security of such Voting Securities on the stock exchange designated by the Directors of the Company over the last five trading days on which at least one board lot of such Voting Securities traded on such exchange during the period of six months ending on the day immediately preceding the date of such repurchase or redemption or, if the Voting Securities are not listed or have not so traded on a stock exchange, the repurchase or redemption price shall be that determined by the Directors of the Company.

(i) If and whenever the Company has determined to sell, repurchase or redeem any Voting Securities pursuant to this Article, the number and selection of such Voting Securities to be sold, repurchased or redeemed shall be determined in the manner provided from time to time by the Directors of the Company, acting fairly and in the best interest of the Company, who shall have the power to determine that any or all such Voting Securities of one holder, and a different number or none of another holder, be sold, repurchased or redeemed. The Directors shall also determine the procedure or procedures for, and the time or times of, any sale, repurchase or redemption of such Voting Securities; provided that if the Directors of the Company determine to sell, repurchase or redeem a portion only of the Voting Securities of one or more holders such portion shall be sufficient so that after sale, repurchase or redemption the relevant share holding limit for Voting Securities set forth in paragraph (a) of this Article 13 is not exceeded.

(j) The Company shall maintain a register of Voting Securities sold, repurchased or redeemed pursuant to the provisions of this Article 13 which register shall be open for inspection at the times and in the manner that the Register of Holders of Voting Securities is open for inspection, and shall, as soon as is reasonably possible in the circumstances, after such sale, repurchase or redemption,

(i) mail a written notice thereof to the former registered holder of such Voting Securities by prepaid first class mail to the address of such holder shown in the Register of Holders of Voting Securities specifying the number of Voting Securities sold, repurchased or redeemed, the sale, repurchase or redemption proceeds, as the case may be, of such Voting Securities and the particulars as to how such sale, repurchase or redemption proceeds may be claimed; and

(ii) publish a notice for two consecutive days in the financial section of a general circulation daily newspaper in the Cities of Vancouver, Calgary, Edmonton, Regina, Winnipeg, Toronto, Ottawa, Montreal, Halifax and St. John's specifying the number of the certificate or certificates representing any Voting Securities which have been sold, repurchased or redeemed and the costs of such publishing shall be paid from the proceeds of such sale, repurchase or redemption.

(k) If and whenever the Company sells, repurchases or redeems, pursuant to the provisions of this Article 13, less than all of the Voting Securities represented by a certificate, the remaining Voting Securities shall be transferred to the registrar and transfer agent of the Voting Securities to be held by it as bare trustee for the holder thereof. Such holder shall be entitled to receive a certificate for such remaining Voting Securities upon request and payment to the registrar and transfer agent of its appropriate fee.

(l) The Company shall have no duty or obligation to ensure that the address of the holder of Voting Securities in the Register of Holders of Voting Securities is complete or correct or to make any inquiries in that regard or take notice of any inaccuracies therein, except to ensure that such address corresponds to the address of such holder given to the Company at the time of the subscription for or transfer of Voting Securities or to the last notice in writing received from such holder with the express stated purpose of notifying the registrar of such holder's address.

(m) The Directors and officers of the Company shall not be liable to the Company nor shall any of them or the Company be liable to any holder or former holder of Voting Securities for, or with respect to any matter arising from or related to, anything done or omitted pursuant to the provisions of this Article 13 if done or omitted acting honestly and in good faith.

(n) Neither (i) the acceptance by the Company of a subscription for, or the registration by the Company of a transfer of, Voting Securities under circumstances in which the Company is prohibited from accepting such subscription or registration nor (ii) the failure of the Company to sell, cause to be sold, repurchase or redeem any Voting Securities of a holder in circumstances under which the Company is required to do so pursuant to this Article 13, shall in any way constitute a waiver of, or preclude the Company from exercising its right to sell, cause to be sold, repurchase or redeem, at any time, all or a portion of the Voting Securities of a holder pursuant to the provisions of this Article 13 at any time thereafter.

(o) The Company shall, before any Voting Securities are voted, disqualify or disregard any and all votes cast by a holder who, together with such holder's associates, holds Voting Securities entitling the holders thereof to vote more than 15% of the total number of votes attached to all Voting Securities then issued and outstanding.

(p) The term "associate" shall for the purposes of this Article 13 refer to a relationship between two persons where:

(i) one person is a corporation that is controlled directly or through one or more subsidiaries of the other person;

(ii) both persons are corporations and one of them is controlled directly or indirectly by the same government, individual or corporation that controls directly or indirectly the other person;

(iii) one of them is a corporation in which the other person beneficially owns or controls, directly or indirectly, shares or securities currently convertible into shares having more than 15% of the voting rights under any or all circumstances or by reason of the occurrence of an event that has occurred and is continuing, or beneficially owns or controls a currently exercisable option or right to purchase such shares or convertible securities;

(iv) one of them is a trust, other than pursuant to any employee share purchase plan established by the Company, or an estate in which the other has substantial beneficial interest or in respect of which the other serves as a trustee or in a similar capacity;

(v) one of them is the spouse of the other or his or her relative if that relative has the same residence as the other;

(vi) both persons are members of a voting trust, other than pursuant to any employee share purchase plan established by the Company, where the trust relates to Voting Securities;

(vii) both persons are agents of the same government; or

(viii) both persons perform on behalf of the same government a function or duty in connection with the administration, management or investment of any fund or monies;

and two or more persons associated within the meaning of items (i) and (ii) and items (iv) to (viii) with the same person, shall be associates of each other.

For the purposes of this Article 13, a corporation is controlled by another person or by two or more persons if:

(i) Voting Securities of the corporation carrying more than 50% of the votes for the election of directors are held, otherwise than by way of security only, by or for the benefit of the other person or persons, and

(ii) the votes carried by such Voting Securities are entitled, if exercised, to elect a majority of the Board of Directors of the Corporation,

but the Directors of the Company acting fairly and in the best interests of the Company may determine that a corporation is controlled by another person or by two or more persons notwithstanding that the criteria set forth in clauses (i) and (ii) above are not met and, upon such determination being made by the Directors of the Company, the corporation shall be deemed for all purposes of this Article 13 to be controlled by such other person or persons.

For the purposes of this Article 13, a corporation shall be deemed to be a subsidiary of another corporation if:

(i) it is controlled by:

(a) that other corporation; or

(b) that other corporation and one or more corporations, each of which is controlled by that other corporation; or

(c) two or more corporations, each of which is controlled by that other corporation; or

(ii) it is a subsidiary of a corporation that is that other corporation's subsidiary.

The term "associate" also applies to the parties to a relationship between any persons, firms, associations, corporations, partnerships or others or between any combination of the foregoing who are, in the sole opinion of the Directors of the Company, acting in concert with respect to the Company or their Voting Securities or other interest in the Company.

(q) The term "Voting Securities" when used in this Article 13 shall mean any securities of the Company carrying voting rights under all circumstances or by reason of the occurrence of an event that has occurred and is continuing and shall include securities of the Company currently convertible into Voting Securities.

(r) When used herein, the terms "subscriber", "transferee" and "holder" shall include all such persons that have, or would after the subscription or transfer have, an interest in Voting Securities except those that hold as bare trustees nominees or underwriters holding Voting Securities as provided in paragraph (a) of this Article 13."

1987 c35 Sch B

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