...if you tried the link in my previous post you'll know it didn't work, this new link does work, when you click on it go to May 21st. 2009, Management Information Circular"... sorry about that chief...
...here’s the link in sedar for the rights plan if you prefer, otherwise I have copied and pasted the entire “Shareholder Right’s Plan” below…
http://www.sedar.com/DisplayCompanyDocuments.do?lang=EN&issuerNo=00002302
Confirmation of Shareholder Rights Plan
Background to the Shareholder Rights Plan
At the Meeting, shareholders will be asked to consider and vote to ratify, confirm and approve a shareholder rights
plan (the “Shareholder Rights Plan”).On May 8, 2009, the Board of Directors of the Company voted to adopt the
Shareholder Rights Plan.The Shareholder Rights Plan is designed to ensure the fair treatment of shareholders in
connection with any take-over bid for the Company and to provide the Board of Directors and shareholders with
sufficient time to fully consider any unsolicited take-over bid.The Shareholder Rights Plan also provides the Board of
Directors with time to pursue, if appropriate, other alternatives to maximize shareholder value in the event of a take-
over bid. The adoption of the Shareholder Rights Plan remains subject to acceptance by the TSX Venture Exchange.
Under the Shareholder Rights Plan, rights (the “Rights”) will be issued to holders of Common Shares at a rate of one
Right for each Common Share outstanding at the close of business on May 8, 2009.
The Shareholder Rights Plan is contained in an agreement entered into with Equity Transfer & Trust Company, the
Company’s transfer agent.A summary of the terms of the Shareholder Rights Plan is contained in Schedule “C” to
this Management Information Circular.This summary is qualified in its entirety by the full text of the Shareholder
Rights Plan, a copy of which is available to any shareholder upon request made in writing to 50 Richmond Street East,
Suite 101, Toronto, Ontario, M5C 1N7 or email at info@spiderresources.com, respectively.The full text of the
Shareholder Rights Plan can equally be viewed in electronic format at www.sedar.com or the Company’s website at
www.spiderresources.com.
All capitalized terms used in this section of the Management Information Circular have the meanings set forth in the
Shareholder Rights Plan unless otherwise capitalized.
Accordingly, the shareholders of the Company will be asked to consider and, if thought appropriate, to approve and
adopt the following ordinary resolution, ratifying the Shareholder Rights Plan:
“BE IT RESOLVED, as an ordinary resolution of the shareholders of Spider Resources Inc. (the “Company”), that:
1. The shareholder rights plan containing the terms and conditions substantially as set forth in the shareholder
rights plan dated as of May 8, 2009, between the Company and Equity Transfer & Trust Company (the
“Shareholder Rights Plan”), a copy of which has been tabled at this meeting, be and is hereby ratified,
confirmed and approved;
2. The actions of the directors of the Company in adopting the Shareholder Rights Plan and in executing and
delivering the Shareholder Rights Plan be and are hereby ratified, confirmed and approved; and
3. Any one director or officer of the Corporation be and is hereby authorized and directed to perform all such
acts, deeds and things and execute all such documents and other instruments as may be required to give effect
to the intent of this resolution.”
If the Shareholder Rights Plan is not confirmed at the Meeting, then the Shareholder Rights Plan and all Rights issued
thereunder will be of no further force and effect.The Board of Directors has not determined what further action, if
any, it would take if the Shareholder Rights Plan is not confirmed at the Meeting.
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Unless otherwise specified by the Shareholders executing a proxy, the persons named as proxies in the enclosed
form of proxy intend to vote the Common Shares represented by such proxy in favour of the Share
Consolidation Resolution.
Recommendation of the Board of Directors
The Board of Directors has determined that the Shareholder Rights Plan is in the best interests of the Company
and its shareholders and unanimously recommends that shareholders vote “FOR” the resolution ratifying,
confirming and approving the Shareholder Rights Plan.Management has been advised that the directors and
senior officers of the Company intend to vote all Common Shares held by them in favour of the ratification,
confirmation and approval of the Shareholder Rights Plan.The persons named in the enclosed form of proxy
intend to vote in favour of such resolution unless otherwise directed by the shareholders appointing them.
Objectives of the Shareholder Rights Plan
The principal objectives of the Shareholder Rights Plan are to ensure that, in the event that a bid for control of the
Company is made pursuant to an acquisition of the Company’s Common Shares (the “Voting Shares”), the Board of
Directors has sufficient time to explore and develop alternatives for maximizing shareholder value and to provide
adequate time for competing bids to be tabled.From the shareholders’ perspective, a shareholder rights plan ensures
that shareholders have enough time to properly assess the bid and ensures that shareholders have an equal opportunity
to participate in such a bid.
In approving the Shareholder Rights Plan, the Board of Directors considered the following concerns inherent in the
existing legislative framework governing take-over bids in Canada:
1. Time.The Plan is intended to ensure that there is sufficient time for shareholders to consider and respond to a
take-over bid without undue pressure and for the Board to explore other alternatives available to maximize
shareholder value in circumstances where other bidders may be prepared to pay more than the offeror.
Canadian securities legislation (which requires that a take-over bid remain open for 35 days) may not provide
sufficient time for these purposes.
2.Creeping Acquisition of Control.Although securities legislation has addressed many aspects of unequal
treatment of shareholders, it is possible that control or effective control of the Corporation may be acquired
pursuant to one or more private agreements in which a small number of shareholders dispose of their common
shares at a premium to market which is not shared with the other shareholders.Also, a person may slowly
accumulate common shares through stock exchange acquisitions which may result, over time, in the
acquisition of control without payment of fair value for control or fair sharing of any control premium among
all shareholders.The Plan addresses these concerns.
3.Pressure to Tender.Shareholders may feel compelled to tender to a partial take-over bid which they consider
inadequate because, if they do not, they will be left holding illiquid or minority discounted shares.The
Permitted Bid provisions of the Plan allow shareholders to separate the tender decision from the partial take-
over bid approval decision by requiring that a partial bid remain open for acceptance for a further 10 business
days following public announcement that more than 50% of the common shares (other than those held by the
offeror) have been tendered to the bid.
4.Terms of Plan.Based on the advice of its legal advisors, management believes that the terms of the Plan
conform with the current Canadian practices.Among other things, the Plan has been designed to avoid
inadvertent application of the Plan to the activities of portfolio managers, trust companies and other persons
where a substantial portion of the ordinary business of such person is the management of funds for
unaffiliated investors.
5.Permitted Bid Mechanism.By proposing the Plan, the Corporation is not intending to secure the continuance
in office of existing directors or management or to avoid a take-over bid for the Corporation.A take-over bid
which satisfies the Permitted Bid provisions of the Plan will not trigger the Plan, whether or not the bid is
acceptable to the Board.
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6.Other Considerations.The Plan does not inhibit shareholders from exercising their rights as shareholders
under the Corporation’s corporate statute, the Canada Business Corporations Act).These rights include the
right to solicit proxies to promote a change in the composition of the Board and to requisition a shareholders
meeting to transact any proper business stated in the requisition.In addition, the Plan does not affect the
financial condition of the Corporation.Finally, the issuance of rights will not change the manner in which
shareholders currently trade their common shares.
Management has reviewed the Shareholder Rights Plan for conformity with current practices of Canadian companies
with respect to shareholder rights plan design and has determined that the Shareholder Rights Plan conforms to such
practices.
General Impact of the Shareholder Rights Plan
By implementing the Shareholder Rights Plan, it is not the intention of the Board of Directors to secure the
continuance of existing directors or management in office, nor to avoid a bid for control of the Corporation.The rights
of shareholders to seek a change in the management of the Corporation as per the provisions of the Canada Business
Corporations Act or to influence or promote action of the Board of Directors of the Corporation in a desired direction
will not be hindered by the Shareholder Rights Plan.
The definitions of “Acquiring Person” and “Beneficial Ownership” have been carefully worded so as to avoid the
inadvertent triggering of the Shareholder Rights Plan resulting from an overly-broad aggregating of holdings among
institutional investors and their clients.Even in the context of a bid that does not meet the “Permitted Bid” criteria, the
Board of Directors will continue to be bound to consider fully and fairly any bid for the Common Shares in any
exercise of its discretion to waive the application of the Shareholder Rights Plan or redeem the outstanding Rights
issued thereunder.In the circumstances of a bid, the Board of Directors must act honestly and in good faith with
respect to the best interests of the Corporation and its shareholders.
The Shareholder Rights Plan will not interfere with the day to day operations of the Corporation.The issuance of the
Rights does not in any way alter the financial condition, impede business plans or alter the financial statements of the
Corporation.Similarly, the Shareholder Rights Plan will not initially dilute or affect the trading of the Common
Shares.However, if a Flip-In Event occurs, as more fully described in Schedule “C” to this Management Information
Circular and the Rights separate from the Common Shares, as described in such Schedule, reported earnings per share
and reported cash flow per share on a fully-diluted basis may be affected. In addition, holders of Rights not exercising
their Rights after a Flip-In Event may suffer substantial dilution.
As of the date of this Management Information Circular, management of the Corporation is not aware of any pending
take-over bids for the Common Shares, or of any person who intends to make a take-over bid for the Common Shares.
The Board of Directors is not aware of, nor is the Board of Directors seeking confirmation of the Shareholder Rights
Plan in anticipation of, any pending or threatened take-over bid or offer for the Common Shares.The Board of
Directors does not have any current intention of implementing any other proposal having an anti take-over effect.
In summary, the dominant effect of the Shareholder Rights Plan will be to enhance shareholder value and ensure equal
treatment of all shareholders in the context of an acquisition of control of the Corporation.
Tax Consequences of the Shareholder Rights Plan
The following discussion on the tax consequences of the Shareholder Rights Plan is of a general nature only and is not
intended to constitute, nor should it be construed to constitute, legal or tax advice to any particular shareholder.
Shareholders are advised to consult their own tax advisers regarding the consequences of acquiring, holding, exercising
or otherwise disposing of their Rights, taking into account their own particular circumstances and applicable foreign or
provincial legislation.
Canadian Federal Income Tax Consequences
While the matter is not free from doubt, the issue of the Rights may be a taxable benefit which must be included in the
income of shareholders in the year of receipt. However, no amount will be required to be included in the income of
shareholders if the Rights do not have any monetary value at the date of issue. The Corporation considers that the
Rights, when issued, will have negligible monetary value, there being only a remote possibility that the Rights will
ever be exercised.Nevertheless, the Canada Revenue Agency is not bound by the Corporation’s assessment of the
value of the Rights.
Assuming that the Rights have no value, shareholders will not be required to include anyamount in income or be
subject to withholding tax under the Income Tax Act (Canada) (the “Tax Act”) as a result of the issuance of the Rights.
Under such circumstances, the Rights will be considered to have been acquired at no cost.
The holders of Rights may be required to include an amount in income or be subject to withholding tax under the Tax
Act if the Rights are exercised or otherwise disposed of.
United States Federal Income Tax Consequences
As the possibility of the Rights becoming exercisable is both remote and speculative, the adoption of the Shareholder
Rights Plan will not constitute the distribution of stock or property by the Corporation to its shareholders, an exchange
of property or stock, or any other event giving rise to the realization of gross income by any shareholder. The holder of
Rights may have taxable income if the Rights become exercisable or are exercised or sold. In the event the Rights
should become exercisable, shareholders should consult their own tax advisors concerning the consequences of
acquiring, holding, exercising or disposing of their Rights.
