UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule TO
Tender Offer Statement under Section 14(d)(1)
or 13(e)(1)
of the Securities Exchange Act of 1934
illumin Holdings Inc.
(Name of Subject Company (Issuer) and Filing
Person (Offeror))
Common Shares, without par value
(Title of Class
of Securities)
00510L106
(CUSIP Number
of Class of Securities)
Elliot Muchnik
Chief Financial Officer
illumin Holdings Inc.
70 University Ave., Suite 1200
Toronto, Ontario M5J 2M4
(416) 218-9888
(Name, Address
and Telephone Number of Person Authorized
to Receive Notices
and Communications on Behalf of Filing Persons)
Copies to:
Brian M. Pukier
Stikeman Elliott LLP
5300 Commerce Court West
199 Bay Street
Toronto, Ontario M5L 1B9
(416) 869-5500
Michael J. Solecki
Jones Day
901 Lakeside Avenue
Cleveland, Ohio 44114-1190
(216) 586-3939
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Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to
which the statement relates:
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third-party tender offer subject to Rule 14d–1. |
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issuer tender offer subject to Rule 13e–4. |
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going-private transaction subject to Rule 13e–3. |
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amendment to Schedule 13D under Rule 13d–2. |
Check the following box if the filing is a final amendment reporting
the results of the tender offer: ☐
If applicable, check the appropriate box(es) below to designate the
appropriate rule provision(s) relied upon:
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Rule 13e–4(i) (Cross-Border Issuer Tender Offer) |
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Rule 14d–1(d) (Cross-Border Third-Party Tender Offer) |
This Tender Offer Statement on Schedule TO relates to the offer by
illumin Holdings Inc., a corporation incorporated under and governed by the Canada Business Corporations Act (“illumin”
or the “Corporation”), to the holders of its common shares (the “Shares”), to purchase up to an
aggregate amount of Cdn$40,000,000 of the Shares at a price of not more than Cdn$2.65 per Share and not less than Cdn$2.53 per Share in
cash, without interest, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated July 27, 2023 (the “Offer
to Purchase”), the accompanying Issuer Bid Circular (the “Circular”), and the related Letter of Transmittal
and Notice of Guaranteed Delivery which, collectively, as amended or supplemented from time to time, constitute the “Tender Offer”.
This Tender Offer Statement on Schedule TO is intended to satisfy the reporting requirements of Rule 13e-4(c)(2) and Rule 13e-4(d)(1)
promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
All information in the Offer to Purchase and the Circular, filed herewith
as Exhibit (a)(1)(A), is hereby expressly incorporated by reference in answer to all items in this Schedule TO, and as more particularly
set forth below.
Item 1. Summary Term Sheet.
The information under the heading “Summary”, included in
Exhibit (a)(1)(A), is incorporated herein by reference.
Item 2. Subject Company Information.
(a) Name and Address: The name of the issuer is illumin
Holdings Inc. The address of the issuer’s principal executive offices is 70 University Ave., Suite 1200, Toronto, Ontario M5J 2M4.
The telephone number at the principal executive offices is (416) 218-9888.
(b) Securities: This Schedule TO relates to the Shares,
which are listed on The Nasdaq Stock Market and Toronto Stock Exchange under the symbol “ILLM”. As of July 25, 2023,
there were 56,185,631 Shares outstanding.
(c) Trading Market and Price: Information about the trading
market and price of the Shares is incorporated herein by reference from the Circular, included in Exhibit (a)(1)(A), under the heading
“Section 5—Price Range and Trading Volume of Shares”.
Item 3. Identity and Background of Filing Person.
(a) Name and Address: The filing person to which this Schedule
TO relates is illumin Holdings Inc. (the issuer). The address and telephone number of illumin are set forth under Item 2(a) above. The
names of the directors and executive officers of illumin are as set forth in the Circular, included in Exhibit (a)(1)(A), under the heading
“Section 8—Interest of Directors and Executive Officers; Transactions and Arrangements Concerning Shares—Ownership
of Securities of the Corporation”, and such information is incorporated herein by reference. The business address and business telephone
number of each director and executive officer of ilumin is c/o illumin Holdings Inc., Suite 1200, Toronto, Ontario M5J 2M4; (416) 218-9888.
Item 4. Terms of the Transaction.
(a) Material Terms: The material terms of the transaction are
incorporated herein by reference from the information under the heading “Summary” from the Offer to Purchase and the Circular,
included in Exhibit (a)(1)(A). There will be no material differences in the rights of security holders as a result of this transaction
(b) Purchases: The information under the headings “Summary”,
“Section 1—The Offer” from the Offer to Purchase and “Section 8— Interest of Directors and Executive Officers;
Transactions and Arrangements Concerning Shares—Arrangements Concerning Shares” from the Circular, each included in Exhibit
(a)(1)(A), is herein incorporated by reference.
Item 5. Past Contacts, Transactions, Negotiations and Agreements.
(e) Agreements Involving the Subject Company’s Securities: Except
for the agreements involving the Shares described in (and incorporated herein by reference from) the Circular, included in Exhibit (a)(1)(A),
under the headings “Section 7—Previous Distributions and Purchases of Securities”, and “Section 8—Interest
of Directors and Executive Officers; Transactions and Arrangements Concerning Shares”, incorporated herein by reference, none of
the Corporation, or to its knowledge, any of its affiliates, directors or executive officers, is a party to any contract, arrangement,
understanding or agreement with any other person relating, directly or indirectly, to the Shares or with respect to any of Algoma’s
securities, including, but not limited to, any contract, arrangement, understanding or agreement concerning the transfer or the voting
of the securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or the giving
or withholding of proxies, consents or authorizations.
Item 6. Purposes of the Transaction and Plans or Proposals.
(a) Purposes: Information regarding the purpose of the
transaction is incorporated herein by reference from the Circular, included in Exhibit (a)(1)(A), under the heading “Section 3—Purpose
and Effect of the Offer”.
(b) Use of the Securities Acquired: The Shares purchased in
the Tender Offer will be cancelled by the Corporation.
(c) Plans: Information about plans and proposals is incorporated
herein by reference from the Circular, included in Exhibit (a)(1)(A), under the headings:
“Section 3—Purpose and Effect of the Offer”;
“Section 6—Dividend Policy”; and
“Section 8—Interest of Directors and Executive Officers;
Transactions and Arrangements Concerning Shares”.
Neither the Corporation nor any of its directors or executive officers
is aware of any plans, proposals or negotiations that would result in (i) any extraordinary transaction involving the Corporation or any
of its subsidiaries, (ii) any purchase, sale or transfer of a material amount of assets of the Corporation or any of its subsidiaries,
(iii) any change in the present dividend rate or policy, or indebtedness or capitalization of the Corporation, (iv) any change in the
present board of directors or management of the Corporation, (v) any other material change in the Corporation’s corporate structure
or business, (vi) any class of securities of the Corporation being delisted from a national securities exchange or ceasing to be authorized
to be quoted in an automated quotations system operated by a national securities association, (vii) any class of equity securities of
the Corporation becoming eligible for termination of registration under section 12(g)(4) of the Exchange Act, (viii) the suspension of
the Corporation’s obligation to file reports under Section 15(d) of the Exchange Act, (ix) the acquisition by any person of additional
securities of the Corporation or the disposition of securities of the Corporation or (x) any changes in the Corporation’s articles
or by-laws or other actions that could impede the acquisition of control of the Corporation.
Item 7. Source and Amount of Funds or Other Consideration.
(a) Source of Funds: Information regarding the source of
funds is incorporated herein by reference from the Circular, included in Exhibit (a)(1)(A), under the heading “Section 14—Source
of Funds”.
(b) Conditions: Information regarding conditions is incorporated
herein by reference from the Offer to Purchase, included in Exhibit (a)(1)(A), under the heading “Section 7— Conditions
of the Offer”.
(d) Not applicable.
Item 8. Interest in Securities of the Subject Company.
(a) Securities Ownership: The information in the Circular, included
in Exhibit (a)(1)(A), under the heading “Section 8—Interest of Directors and Executive Officers; Transactions and Arrangements
Concerning Shares” is incorporated herein by reference.
(b) Securities Transactions: The information in the Circular,
included as Exhibit (a)(1)(A), under the headings “Section 7—Previous Distributions and Purchases of Securities”
and “Section 8—Interest of Directors and Executive Officers; Transactions and Arrangements Concerning Shares” is
incorporated herein by reference.
Item 9. Persons/Assets, Retained, Employed, Compensated or Used.
(a) Solicitations or Recommendations: Information in the
Circular, included in Exhibit (a)(1)(A), under the headings “Section 15—Dealer Managers”, “Section 16—Depositary”
and “Section 17—Fees and Expenses” is incorporated herein by reference.
Item 10. Financial Statements.
(a) and (b) Not applicable.
Item 11. Additional Information.
(a) Agreements, Regulatory Requirements and Legal Proceedings:
(1) The information in the Circular, included in Exhibit (a)(1)(A),
under the heading “Section 8—Interest of Directors and Executive Officers; Transactions and Arrangements Concerning Shares”
is incorporated herein by reference. Other than as set forth in the Offer to Purchase and the Circular, the Corporation is not aware of
any present or proposed material agreement, arrangement, understanding or relationship between the Corporation and any of its executive
officers, directors, controlling persons or subsidiaries.
(2) The information in the Circular, included as Exhibit (a)(1)(A),
under the heading “Section 13—Legal Matters and Regulatory Approvals” is incorporated herein by reference.
(3) Not applicable.
(4) The information in the Circular, included as Exhibit (a)(1)(A),
under the heading “Section 3—Purpose and Effect of the Offer—Additional Securities Law Considerations” is incorporated
herein by reference.
(5) To the knowledge of the Corporation, no material legal proceedings
relating to the Tender Offer are pending.
(c) Other Material Information: The information set forth under
the heading “Summary”, and the information set forth in the Offer to Purchase, the Circular and the related Letter of Transmittal
and Notice of Guaranteed Delivery, as each may be amended or supplemented from time to time, is incorporated herein by reference. The
Corporation will amend this Schedule TO to include documents that the Corporation may file with the Securities and Exchange Commission
after the date of the Offer to Purchase pursuant to Sections 13(a), 13(c), or 14 of the Exchange Act and prior to the expiration of the
Tender Offer to the extent required by Rule 13e-4(d)(2) of the Exchange Act.
Item 12. Exhibits.
Item 13. Information Required by Schedule 13E-3.
Not applicable.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
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ILLUMIN HOLDINGS INC. |
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By: |
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/s/ Elliot Muchnik |
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Name: |
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Elliot Muchnik |
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Title: |
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Chief Financial Officer |
Date: July 27, 2023
Exhibit (a)(1)(A)
This document is important and requires your
immediate attention. If you are in any doubt as to how to deal with it, you are urged to consult your broker, dealer, bank manager, lawyer,
accountant or other professional advisor. This document does not constitute an offer or a solicitation to any person in any jurisdiction
in which such offer or solicitation is unlawful. The Offer is not being made to Shareholders in any jurisdiction in which the making or
acceptance thereof would not be in compliance with the laws of that jurisdiction. However, illumin may, in its sole discretion, take such
action as it may deem necessary to make the Offer in any such jurisdiction and to extend this Offer to Shareholders in such jurisdiction
in accordance with applicable laws.
This Offer has not been approved by any securities
regulatory authority nor has any securities regulatory authority passed upon the fairness or merits of the Offer or upon the adequacy
of the information contained in this document. Any representation to the contrary is an offence.
OFFER TO PURCHASE FOR NOT MORE THAN $40,000,000
UP TO 15,810,276 OF ITS COMMON SHARES AT A PURCHASE PRICE OF NOT LESS THAN $2.53 AND NOT MORE THAN $2.65 PER COMMON SHARE
illumin Holdings Inc. (“illumin”,
the “Corporation”, “we” or “us”) invites its shareholders (“Shareholders”)
to tender, for purchase and cancellation by the Corporation, common shares of the Corporation (“Shares”) pursuant to
(i) auction tenders in which the tendering Shareholders specify a price of not less than $2.53 per Share and not more than $2.65 per Share
in increments of $0.01 per Share (“Auction Tenders”), or (ii) purchase price tenders in which the tendering Shareholders
do not specify a price per Share, but rather agree to have Shares purchased at the Purchase Price (as defined below) that is determined
as provided herein (“Purchase Price Tenders”). The invitation and all tenders of Shares are subject to the terms and
conditions set forth in this offer to purchase (the “Offer to Purchase”), the accompanying Issuer Bid Circular (the
“Circular”) and the related Letter of Transmittal and Notice of Guaranteed Delivery (which together constitute the
“Offer”).
The Offer will commence on the date set forth
below and expire at 5:00 p.m. (Eastern time) on August 30, 2023, unless withdrawn, extended or varied by illumin (such time and such
date, the “Expiration Time” and the “Expiration Date”, respectively). Beneficial owners should be
aware that their broker, dealer, commercial bank, trust company or other nominee may establish its own earlier deadlines for participation
in the Offer. The Offer is not conditional upon the receipt of financing or any minimum number of Shares being tendered. The Offer is,
however, subject to other conditions and illumin reserves the right, subject to applicable laws, to withdraw the Offer and not take up
and pay for any Shares tendered under the Offer if certain events occur. See “Offer to Purchase – Conditions of the Offer”.
Promptly following the Expiration Date, the Corporation
will determine a single price per Share (the “Purchase Price”), taking into account the total number of Shares tendered
and the prices specified, or deemed specified, by the tendering Shareholders, which will not be less than $2.53 per Share and not more
than $2.65 per Share, that is the lowest price that enables it to purchase the maximum number of Shares properly tendered and not withdrawn
pursuant to the Offer having an aggregate Purchase Price not exceeding $40,000,000. If the Purchase Price is determined to be $2.53 (which
is the minimum Purchase Price under the Offer), the maximum number of Shares that may be purchased by the Corporation is 15,810,276 Shares.
If the Purchase Price is determined to be $2.65 (which is the maximum Purchase Price under the Offer), the maximum number of Shares that
may be purchased by the Corporation is 15,094,339 Shares. For the purpose of determining the Purchase Price, Shares tendered pursuant
to a Purchase Price Tender will be considered to have been tendered at $2.53 per Share (which is the minimum Purchase Price under the
Offer). All Shares purchased under the Offer will be purchased at the same Purchase Price, even if some Shares are tendered below the
Purchase Price. However, Shares tendered by a Shareholder pursuant to an Auction Tender will not be purchased by the Corporation pursuant
to the Offer if the price specified by the Shareholder is greater than the Purchase Price. A Shareholder who wishes to tender Shares,
but who does not wish to specify a price at which such Shares may be purchased by the Corporation, should make a Purchase Price Tender.
Shareholders who tender Shares without making a valid Auction Tender or Purchase Price Tender will be deemed to have made a Purchase Price
Tender, understanding that for the purpose of determining the Purchase Price, Shares tendered pursuant to a Purchase Price Tender will
be considered to have been tendered at the minimum price of $2.53 per Share. Each Shareholder should understand that making a Purchase
Price Tender may cause the Purchase Price to be lower than would otherwise be the case.
Each Shareholder who has properly tendered
Shares pursuant to an Auction Tender at or below the Purchase Price or pursuant to a Purchase Price Tender, and who has not properly withdrawn
such Shares, will receive the Purchase Price, payable in cash (subject to applicable withholding taxes, if any), for all Shares purchased,
on the terms and subject to the conditions of the Offer, including the provisions relating to pro-ration described herein.
If the aggregate Purchase Price for Shares properly
tendered and not withdrawn pursuant to the Offer by Purchase Price Tender or by Auction Tender at or below the Purchase Price (the “Successfully
Tendered Shares”) by Shareholders (the “Successful Shareholders”) exceeds $40,000,000, then the Successfully
Tendered Shares will be purchased on a pro rata basis according to the number of Shares tendered (or deemed to be tendered) by the Successful
Shareholders (with adjustments to avoid the purchase of fractional Shares), except that “Odd Lot” tenders (as described herein)
will not be subject to pro-ration. See “Offer to Purchase – Number of Shares and Pro-Ration”.
The Purchase Price and the aggregate amount payable
to the tendering Shareholders (net of applicable withholding taxes, if any) will be denominated in Canadian dollars. The Corporation will
pay for Shares tendered in Canadian dollars. See “Offer to Purchase – Taking Up and Payment for Tendered Shares”.
All tendered Shares not purchased, including all
Shares tendered pursuant to Auction Tenders at prices greater than the Purchase Price, Shares not purchased due to pro-ration and Shares
not accepted for purchase, will be returned to the tendering Shareholder promptly after the Expiration Date or termination of the Offer
without expense to the tendering Shareholder.
As of July 25, 2023, there were 56,185,631 Shares
issued and outstanding and, accordingly, the Offer is for a maximum of approximately 28.14% of the total number of issued and outstanding
Shares if the Purchase Price is determined to be $2.53 (being the minimum Purchase Price under the Offer), and for approximately 26.87%
if the Purchase Price is determined to be $2.65 (being the maximum Purchase Price under the Offer).
Shares are listed and posted for trading on the
Toronto Stock Exchange (the “TSX”) and The Nasdaq Stock Market (“Nasdaq”) under the symbol ‘ILLM’.
On July 25, 2023, the date prior to the announcement of the Corporation’s intention to proceed with a substantial issuer bid, the
closing price on the TSX was $2.37 per Share and on Nasdaq was US$1.81 per Share. Shareholders are urged to obtain current market quotations
for Shares.
The Corporation’s board of directors (the
“Board of Directors” or the “Board”) has approved the Offer. Furthermore, the Board of Directors
has concluded that the Corporation can rely on the “liquid market exemption” specified in Multilateral Instrument 61-101 –
Protection of Minority Security Holders in Special Transactions (“MI 61-101”) from the requirement to obtain a
formal valuation that would otherwise be applicable to the Offer. While not required under applicable securities laws, the Board of Directors
has voluntarily obtained a liquidity opinion (the “Liquidity Opinion”) from Canaccord Genuity Corp. (“Canaccord
Genuity”) to the effect that, as of July 26, 2023, based on and subject to the qualifications, assumptions and limitations stated
in the Liquidity Opinion: (a) a liquid market for Shares exists; and (b) it is reasonable to conclude that, following the completion of
the Offer in accordance with its terms, there will be a market for holders of Shares who do not tender to the Offer that is not materially
less liquid than the market that existed at the time of the making of the Offer. A copy of the Liquidity Opinion is attached hereto as
Schedule A. The summary of the Liquidity Opinion herein is qualified in its entirety by reference to the full text of the Liquidity Opinion.
The Board of Directors urges Shareholders to read the Liquidity Opinion in its entirety. The Liquidity Opinion is not a recommendation
as to whether or not Shareholders should tender or refrain from tendering any or all of such Shareholder’s Shares pursuant to the
Offer.
However, none of illumin, its Board of Directors,
Canaccord Genuity, in its capacity as the Canadian dealer manager for the Offer, Canaccord Genuity LLC (“Canaccord Genuity US”),
the U.S. dealer manager for the Offer (together with Canaccord Genuity, the “Dealer Managers”), or TSX Trust Company,
the depositary for the Offer (the “Depositary”), makes any recommendation to any Shareholder as to whether to tender
or refrain from tendering Shares under the Offer, whether Shareholders should elect an Auction Tender or a Purchase Price Tender, or as
to the purchase price or purchase prices at which Shareholders may tender Shares under the Offer. Shareholders must make their own decisions
as to whether to tender Shares under the Offer, and, if so, how many Shares to tender and the price or prices at which to tender. The
Corporation’s directors and executive officers have advised the Corporation that they do not intend to tender Shares under the Offer.
Shareholders should carefully consider all
relevant factors with their own financial advisors, including the income tax consequences of tendering Shares under the Offer. For some
Shareholders, the income tax treatment of selling Shares to the Corporation under the Offer may be materially different from the income
tax treatment of selling Shares in the market. See “Issuer Bid Circular – Income Tax Consequences”.
Shareholders wishing to tender all or any portion
of their Shares pursuant to the Offer must comply in all respects with the delivery procedures described herein. See “Offer to
Purchase – Procedure for Tendering Shares”.
| The Offer expires at 5:00 p.m. (Eastern time) on August 30, 2023 unless withdrawn, extended or varied. |
OUR BOARD OF DIRECTORS HAS AUTHORIZED US TO
MAKE THE OFFER, HOWEVER, NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF THE CORPORATION OR THE BOARD OF DIRECTORS
AS TO WHETHER SHAREHOLDERS SHOULD TENDER OR REFRAIN FROM TENDERING SHARES PURSUANT TO THE OFFER OR WHETHER SHAREHOLDERS SHOULD ELECT AN
AUCTION TENDER OR A PURCHASE PRICE TENDER. OUR DELIVERY OF THIS OFFER TO PURCHASE SHALL NOT UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED IN THIS OFFER TO PURCHASE, THE CIRCULAR, THE LETTER OF TRANSMITTAL OR THE NOTICE OF GUARANTEED DELIVERY
IS CORRECT AS OF ANY TIME OTHER THAN THE DATE OF THIS OFFER TO PURCHASE OR THAT THERE HAVE BEEN NO CHANGES IN THE INFORMATION INCLUDED
OR INCORPORATED BY REFERENCE HEREIN OR THE AFFAIRS OF ILLUMIN OR ANY OF ITS SUBSIDIARIES OR AFFILIATES SINCE THE DATE HEREOF. NO PERSON
HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THE OFFER OTHER THAN AS SET FORTH IN THIS
OFFER. IF GIVEN OR MADE, ANY SUCH RECOMMENDATION OR ANY SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE CORPORATION, THE BOARD OF DIRECTORS, THE DEALER MANAGERS OR THE DEPOSITARY.
No Canadian, U.S. or foreign commission has
approved or disapproved of this Offer or passed upon the merits or fairness of this Offer or passed upon the adequacy or accuracy of the
information contained in this document. Any representation to the contrary is unlawful and may be a criminal offense.
Any questions or requests for information regarding
the Offer should be directed to the Depositary or the Dealer Managers at the addresses, telephone and facsimile numbers of the Depositary
and the Dealer Managers set forth below. You may request additional copies of this Offer to Purchase, the Circular and the related Letter
of Transmittal and Notice of Guaranteed Delivery from the Depositary, which will promptly furnish to Shareholders additional copies of
these materials at the Corporation’s expense.
The Dealer Managers for the Offer are:
In Canada:
Canaccord Genuity
Corp.
40
Temperance Street, Suite 2100
Toronto,
Ontario
M5H
0B4
Email: ecm@cgf.com
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In
the United States:
Canaccord Genuity
LLC
99
High Street, 12th Floor
Boston,
MA
02110
Email: ecm@cgf.com
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The Depositary for the Offer is:
TSX Trust Company
301 – 100 Adelaide St W
Toronto, ON M5H 4H1
Attention: Corporate Actions
Telephone: 416-342-1091
Toll Free: 1-866-600-5869
E-mail: tsxtis@tmx.com |
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INFORMATION FOR UNITED STATES SHAREHOLDERS
The Corporation has filed with the U.S. Securities
and Exchange Commission (the “SEC”) a Schedule TO with respect to the Offer, pursuant to Section 13(e)(1) of the U.S.
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Rule 13e-4(c)(2) promulgated thereunder. See
“Offer to Purchase – Additional Information”.
THE OFFER HAS NOT BEEN APPROVED BY THE SEC OR
ANY STATE SECURITIES COMMISSION NOR HAS THE SEC OR ANY STATE SECURITIES COMMISSION PASSED UPON THE FAIRNESS OR MERITS OF THE OFFER OR
UPON THE ACCURACY OF THE INFORMATION CONTAINED IN THIS OFFER TO PURCHASE AND THIS CIRCULAR AND ANY RELATED DOCUMENTS, AND ANY REPRESENTATION
TO THE CONTRARY IS UNLAWFUL AND MAY BE A CRIMINAL OFFENSE.
The enforcement by Shareholders of civil liabilities
under U.S. federal and state securities laws may be adversely affected by the fact that illumin is incorporated under the federal laws
of Canada, that some of its officers and directors and some of the experts named in this Offer to Purchase and this Circular are residents
of countries other than the United States, and that a substantial portion of the assets of illumin and such persons are located outside
the United States. It may be difficult to effect service of process on illumin, its officers and directors and the experts named in this
Offer to Purchase and this Circular. In addition, U.S. Shareholders should not assume that courts in Canada or in the countries where
such directors and officers reside or in which illumin’s non-U.S. assets or the assets of such persons are located (i) would enforce
judgments of U.S. courts obtained in actions against illumin or such persons predicated upon civil liability provisions of U.S. federal
or state securities laws as may be applicable, or (ii) would enforce, in original actions, any asserted liabilities against illumin, its
subsidiaries or such persons predicated upon such laws. Enforcement of any asserted civil liabilities under U.S. securities laws may be
further adversely affected by the fact that some or all of the experts named in the Offer may be residents of Canada.
United States Shareholders should be aware that
the acceptance of the Offer will have certain tax consequences under United States and Canadian law. See “Issuer Bid Circular –
Income Tax Consequences”. Shareholders should consult their own tax advisors with respect to their particular circumstances and
tax considerations applicable to them.
The Corporation is a “foreign private issuer”
within the meaning of Rule 3b-4 under the Exchange Act. Consequently, illumin is subject to the reporting requirements under the Exchange
Act applicable to foreign private issuers and is not required to file periodic reports and financial statements with the SEC as frequently
or as promptly as a U.S. company whose securities are registered under the Exchange Act and is also be exempt from the rules and regulations
under the Exchange Act related to the furnishing and content of proxy statements. The Corporation is also not be required to comply with
Regulation FD, which addresses certain restrictions on the selective disclosure of material information. In addition, among other matters,
illumin officers, directors and principal shareholders are be exempt from the reporting and “short-swing” profit recovery
provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of Shares.
Additionally, Nasdaq rules allow foreign private issuers to follow home country practices in lieu of certain of Nasdaq’s corporate
governance rules. As a result, Shareholders may not have the same protections afforded to shareholders of companies that are subject to
all of the SEC’s rules and Nasdaq corporate governance requirements applicable to U.S. public companies.
FORWARD-LOOKING INFORMATION
This Offer to Purchase and this Circular contains
forward-looking information and forward-looking statements within the meaning of applicable Canadian and U.S. securities laws (collectively
referred to herein as “forward-looking information”). Words such as “may”, “will”, “expect”,
“believe”, “anticipate”, “intend”, “could”, “estimate”, “continue”,
or the negative or comparable terminology are intended to identify forward-looking information. In addition, any statements that refer
to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information.
Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates
and projections regarding future events or circumstances. Forward-looking information is information other than historical information
or information of current condition, that includes, but is not limited to, information respecting: the number of Shares that the Corporation
may purchase in the Offer; the price range and the date on which the Corporation will announce the final results of the Offer or pay for
tendered Shares; the timelines anticipated for the Offer; the Corporation’s ability to complete the Offer on the timelines anticipated;
the Corporation’s belief that the purchase of Shares under the Offer represents an equitable and efficient means of distributing
cash to Shareholders who elect to tender; the Corporation’s expectation that it will fund any purchases of Shares pursuant to the
Offer from cash on hand; the Corporation continuing to have sufficient financial resources and working capital and the Offer not being
expected to preclude the Corporation from pursuing its foreseeable business opportunities or the future growth of the Corporation’s
business; the market for Shares not being materially less liquid than the market that exists at the time of the making of the Offer; and
future purchases of additional Shares following expiry of the Offer, if any. This should not be considered a complete list of all factors
that could affect the Corporation and the Offer. When relying on forward-looking statements to make decisions with respect to tendering
to the Offer, you should carefully consider these factors, as well as other uncertainties and potential events and the inherent uncertainty
of forward-looking statements.
Forward-looking information involves known and
unknown risks, uncertainties and other factors that may cause actual results to differ materially from those in forward-looking information
due to various factors. All of the forward-looking information contained herein is qualified by the assumptions that are stated or inherent
in such forward-looking information, including the assumptions listed below. Although illumin believes that these assumptions are reasonable,
this list is not exhaustive of the factors that may affect any of the forward-looking information and the reader should not place an undue
reliance on these assumptions and such forward-looking information. The key assumptions that have been made in connection with the forward-looking
information include; the general continuance of current or, where applicable, assumed operational, regulatory and industry conditions;
and expectations and projections made in light of, and generally consistent with, illumin’s historical experience and its perception
of historical trends. Despite a careful process to prepare and review the forward looking information, there can be no assurance that
the underlying assumptions will prove to be correct.
Risks and uncertainties that may affect these
outcomes include: uncertainty in the level of Shareholder participation in the Offer; failure to complete the Offer due to conditions
to the Offer not being satisfied or waived; the market for Shares not being materially less liquid after the completion of the Offer than
the market that exists at the time of the Offer; future financial performance; future cash flow and liquidity; future capital investment;
our ability to generate sufficient cash flow to meet obligations, operate our business, remain in compliance with debt covenants and make
payments on our indebtedness; future fluctuations of financial results due to: changes in demand for the illuminTM platform,
changes in illumin’s pricing policies, the pricing policies of its competitors and the pricing or availability of inventory, data
or other third-party services, changes in illumin’s customer base and platform offerings, the addition or loss of advertising agencies
and marketers as customers, changes in advertising budget allocations, agency affiliations or marketing strategies, changes to illumin’s
channel mix, changes and uncertainty in the regulatory and business environment for illumin or its customers, changes in the economic
prospects of marketers or the economy generally, which could alter marketers’ spending priorities, or could increase the time or
costs required to complete advertising inventory sales, changes in the availability of advertising inventory or in the cost of reaching
end consumers through digital advertising, disruptions or outages on illumin’s platforms, changes in illumin’s capital expenditures
as it acquires the hardware, equipment and other assets required to support its business, timing differences between our payments for
advertising inventory and our collection of related advertising revenue, the length and unpredictability of illumin’s sales cycle,
costs related to acquisitions of business or technologies, or employee recruiting and shifting views and behaviors of consumers concerning
the use of data; increased use of competitive products; the increased use of free or paid “ad-blocking” software by consumers;
decreased use of third-party cookies for tracking by vendors and software platforms; potential government regulations and/or privacy legislation
implementing a “Do Not Track” standard and consumers adopting such preferences; unfavourable developments in connection with
the potential further regulation of personal information; risks associated with technology, including electronic, cyber and physical security
breaches; inability to product illumin’s proprietary offering; illumin may infringe third-party proprietary and/or intellectual
property right; risks associated with illumin’s use of “open source” software; changes in consumer’s use of social
media platforms could impact how illumin gathers and uses social data; currency fluctuations, including an increase in the value of the
Canadian dollar against the U.S. dollar; a protracted global recession or depression; risks associated with existing and potential lawsuits
and regulatory actions made against the Corporation; impact of disputes arising with its partners; the risks associated with the advertising
industry generally; changes in general economic conditions, including as a result of a pandemic or the current conflict between Russia
and Ukraine; risks associated with inflation rates; and other risks inherent to the operations and financial health of the Corporation.
This should not be considered a complete list of all factors that could affect the Corporation and the Offer. When relying on forward-looking
statements to make decisions with respect to tendering to the Offer, readers should carefully consider these factors, as well as other
uncertainties and potential events and the inherent uncertainty of forward-looking statements. You should review the factors and risks
described in the reports we will file from time to time with the SEC through the SEC’s Electronic Document Gathering and Retrieval
System (“EDGAR”), which may be accessed at www.sec.gov and on the Corporation’s System for Electronic Data Analysis
and Retrieval + (“SEDAR+”) profile at www.sedarplus.com after the date of this Offer to Purchase and this Circular.
All of the forward-looking information contained
in this Offer to Purchase and this Circular is expressly qualified by the foregoing cautionary statements. Accordingly, you should not
rely on these forward-looking statements, which speak only as of the date of this Offer to Purchase and this Circular. We undertake no
obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this Offer to Purchase
and this Circular or to reflect the occurrence of unanticipated events. You should read this entire Offer to Purchase and this Circular
and consult your own professional advisors to ascertain and assess the income tax, legal, risk factors and other aspects of the Offer
or their investment in Shares.
Although we believe the expectations reflected
in the forward-looking statements were reasonable at the time made, we cannot guarantee future results, level of activity, performance
or achievements. You should carefully consider the cautionary statements contained or referred to in this section in connection with the
forward looking statements contained in this Offer to Purchase and this Circular and any subsequent written or oral forward-looking statements
that may be issued by the Corporation or persons acting on its behalf.
NOTICE TO HOLDERS OF OPTIONS
The Offer is made only for Shares and not made
for any options to acquire Shares (“Options”). Any holder of Options who wishes to accept the Offer should, to the
extent permitted by the terms thereof, fully exercise such Options in order to tender the resulting Shares in accordance with the terms
and conditions of the Offer. Any such exercise must occur sufficiently in advance of the Expiration Date to enable holders of Options
to have sufficient time to comply with the procedures for tendering Shares in the Offer. An exercise of an Option cannot be revoked even
if Shares received upon exercise thereof and tendered in the Offer are not purchased in the Offer for any reason. No recommendation is
being made as to whether any holder of Options should exercise such Options in order to tender the resulting Shares in accordance with
the terms and conditions of the Offer.
Holders of Options that exercise such Options
and then tender Shares received on such exercise pursuant to the Offer could suffer adverse tax consequences. The tax consequences of
such an exercise are not described under the “Issuer Bid Circular – Income Tax Consequences”. Holders of Options are
urged to seek tax advice from their own tax advisors in this regard.
CURRENCY AND EXCHANGE RATE
All dollar references in this Offer to Purchase
and this Circular are in Canadian dollars ($), except where otherwise indicated.
The following table sets forth, for each fiscal
year indicated, the high and low exchange rates for one U.S. dollar (US$) expressed in Canadian dollars, the average of such exchange
rates during such periods, and the exchange rate at the end of the period, in each case, based upon the Bank of Canada’s daily average
exchange rates.
| | |
Year ended December 31 |
| | |
2022 | |
2021 | |
2020 |
| High | |
| 1.3856 | | |
| 1.2942 | | |
| 1.4496 | |
| Low | |
| 1.2451 | | |
| 1.2040 | | |
| 1.2718 | |
| Average | |
| 1.3011 | | |
| 1.2535 | | |
| 1.3415 | |
| Period End | |
| 1.3544 | | |
| 1.2678 | | |
| 1.2732 | |
The following table sets forth, for the first
and second quarter of fiscal 2023, the high and low exchange rates for one U.S. dollar (US$) expressed in Canadian dollars, the average
of such exchange rates during such periods, and the exchange rate at the end of the period, in each case, based upon the Bank of Canada’s
daily average exchange rates.
| | |
Fiscal 2023 |
| | |
Q1 | |
Q2 |
| High | |
| 1.3807 | | |
| 1.3628 | |
| Low | |
| 1.3312 | | |
| 1.3151 | |
| Average | |
| 1.3526 | | |
| 1.3430 | |
| Period End | |
| 1.3533 | | |
| 1.3240 | |
On July 25, 2023, the exchange rate for one U.S.
dollar expressed in one Canadian was 1.3184 based upon the Bank of Canada daily average exchange rate.
ADDITIONAL INFORMATION
Availability of Reports and Other Information.
The Corporation is subject to the continuous disclosure requirements of applicable Canadian securities legislation and the rules of the
TSX and Nasdaq, as well as the reporting requirements of the Exchange Act, and in accordance therewith, files periodic reports and other
information with Canadian provincial and territorial securities regulators, the TSX, Nasdaq and the SEC relating to illumin’s business,
financial condition and other matters. As required by Exchange Act Rule 13e-4(c)(2), we have also filed with the SEC a Schedule TO, which
includes additional information relating to the Offer. Shareholders may access documents filed with Canadian provincial and territorial
securities regulators through the Corporation’s SEDAR+ profile at www.sedarplus.com. Shareholders may access documents filed with
or furnished to the SEC through EDGAR, which may be accessed at www.sec.gov.
Historical Financial Information.
The Corporation’s consolidated financial statements are reported in Canadian dollars and have been prepared in accordance with International
Financial Reporting Standards as issued by the International Accounting Standards Board. The audited consolidated financial statements
of illumin for the years ended December 31, 2022, 2021 and 2020, which are available on SEDAR+ at www.sedarplus.com and on EDGAR at www.sec.gov
and will be sent to a Shareholder without charge upon request to the Corporation at Suite 1200, 70 University Avenue, Toronto, Ontario
M5J 2M4, Attention: Chief Financial Officer.
Pursuant to Rule 13e-4(c)(2) under the Exchange
Act, illumin has filed with the SEC a Schedule TO which contains additional information with respect to the Offer. This Offer to Purchase
and this Circular, which constitutes a part of the Schedule TO, does not contain all of the information set forth in the Schedule TO.
The Corporation has not authorized any person
to make any recommendation on its behalf as to whether a Shareholder should tender or refrain from tendering its Shares to the Offer,
whether Shareholders should elect an Auction Tender or a Purchase Price Tender, or as to the price or prices at which any Shareholder
may choose to tender its Shares under the Offer. Shareholders should rely only on the information contained in this document. The Corporation
has not authorized anyone to provide Shareholders with information or to make any representation in connection with the Offer other than
those contained in this Offer to Purchase, the Circular or in the related Letter of Transmittal or Notice of Guaranteed Delivery. If anyone
makes any recommendation or gives any information or representation, Shareholders must not rely upon that recommendation, information
or representation as having been authorized by the Corporation, its Board of Directors, the Dealer Managers or the Depositary. We also
urge Shareholders to consult their own financial, legal, investment and tax advisors.
Information on or connected to our website,
even if referred to in documents incorporated by reference in this Offer to Purchase and this Circular, do not constitute part of this
Offer to Purchase and this Circular.
Unless another date is specified herein, Shareholders
should not assume that the information contained in or incorporated by reference in this Offer to Purchase and this Circular is accurate
as of any date other than the date of this Offer to Purchase and this Circular.
TABLE OF CONTENTS
| SUMMARY |
2 |
| OFFER TO PURCHASE |
1 |
| 1. | The Offer |
1 |
| 2. | Purchase Price |
2 |
| 3. | Number of Shares and Pro-Ration |
2 |
| 4. | Announcement of Purchase Price, Number of Shares Validly Tendered and Aggregate Purchase Price |
3 |
| 5. | Procedure for Tendering Shares |
3 |
| 6. | Withdrawal Rights |
7 |
| 7. | Conditions of the Offer |
9 |
| 8. | Extension and Variation of the Offer |
12 |
| 9. | Taking Up and Payment for Tendered Shares |
13 |
| 10. | Payment in the Event of Mail Service Interruption |
14 |
| 11. | Liens and Dividends |
15 |
| 12. | Notice |
15 |
| 13. | Other Terms |
15 |
| ISSUER BID CIRCULAR |
17 |
| 1. | illumin Holdings Inc. |
17 |
| 2. | Authorized Capital |
17 |
| 3. | Purpose and Effect of the Offer |
17 |
| 4. | Withdrawal Rights |
21 |
| 5. | Price Range and Trading Volume of Shares |
21 |
| 6. | Dividend Policy |
23 |
| 7. | Previous Distributions and Purchases of Securities |
23 |
| 8. | Interest of Directors and Executive Officers; Transactions and Arrangements Concerning Shares |
24 |
| 9. | Material Changes in the Affairs of the Corporation |
28 |
| 10. | Valuation and Bona Fide Prior Offers |
29 |
| 11. | Accounting Treatment of the Offer |
29 |
| 12. | Income Tax Consequences |
29 |
| 13. | Legal Matters and Regulatory Approvals |
39 |
| 14. | Source of Funds |
39 |
| 15. | Dealer Managers |
39 |
| 16. | Depositary |
40 |
| 17. | Fees and Expenses |
40 |
| 18. | Statutory Rights |
40 |
| APPROVAL AND CERTIFICATE |
41 |
| CONSENT OF CANACCORD GENUITY CORP. |
42 |
| SCHEDULE A LIQUIDITY OPINION OF CANACCORD GENUITY CORP. |
A-1 |
| SUMMARY |
| |
This summary is solely for the convenience of
Shareholders and is qualified in its entirety by references to the full text and more specific details of the Offer and the accompanying
Circular. We urge you to read the entire Offer to Purchase, Circular, Letter of Transmittal and Notice of Guaranteed Delivery carefully
and in their entirety as they contain a complete discussion of the Offer. We have included in this summary references to sections of certain
of these documents where you will find a more complete description of the topics summarized below.
|
| |
|
| Who is offering to purchase my Shares? |
illumin Holdings Inc., which we refer to as “we”, “us”, “illumin” or the “Corporation”.
|
| Why is illumin making the Offer? |
We continuously consider ways to enhance Shareholder value. Following a thoughtful review of the capital required for our operational and strategic investment needs, we have determined that the Corporation has excess cash that is available to return to Shareholders. We believe that the purchase of Shares under the Offer represents an attractive investment by the Corporation and an equitable and efficient means to distribute an aggregate of up to $40,000,000 to Shareholders who elect to tender, while at the same time proportionately increasing the equity interest in the Corporation of Shareholders who do not elect to tender, and that the Offer is in the best interests of the Corporation and its Shareholders. Furthermore, the Corporation has re-evaluated the continued benefits and costs of its listing on Nasdaq and has concluded that it is appropriate to delist from Nasdaq as soon as practical following the expiry of the Offer. The Offer provides U.S. Shareholders with an opportunity for liquidity at a premium well in advance of such delisting from Nasdaq. See “Issuer Bid Circular – Purpose and Effect of the Offer”.
|
| What will the Purchase Price for Shares be and what will be the form of payment? |
We are conducting the Offer through a procedure commonly called a “Dutch auction”. This procedure allows Shareholders to select the price within a price range specified by illumin at which Shareholders are willing to sell their Shares. The price range for the Offer is $2.53 to $2.65 per Share. We will select the lowest Purchase Price that will allow us to purchase the maximum number of Shares properly tendered and not withdrawn pursuant to the Offer having an aggregate Purchase Price not exceeding $40,000,000. We will purchase all Shares purchased under the Offer at the same Purchase Price, even if some Shares are tendered below the Purchase Price, but we will not purchase any Shares above the Purchase Price. We will determine the Purchase Price for the tendered Shares promptly after the Offer expires. Shareholders who tender Shares without making a valid Auction Tender or Purchase Price Tender will be deemed to have made a Purchase Price Tender, understanding that for the purpose of determining the Purchase Price, Shares tendered pursuant to a Purchase Price Tender will be considered to have been tendered at the minimum price of $2.53 per Share. If a Shareholder’s Shares are purchased under the Offer, that Shareholder will be paid the Purchase Price (subject to applicable withholding taxes, if any) in cash, without interest, promptly following the expiration of the Offer. Under no circumstances will we pay interest on the Purchase Price, even if there is a delay in making payment. See “Offer to Purchase – Purchase Price”. |
| How many Shares will illumin purchase in the Offer? |
We are offering to purchase Shares that have an
aggregate Purchase Price not exceeding $40,000,000. At the maximum Purchase Price of $2.65 per Share, we could purchase 15,094,339 Shares.
At the minimum Purchase Price of $2.53 per Share,
we could purchase 15,810,276 Shares. Since we will be unable to determine the Purchase Price until after the Expiration Date, we will
not determine the exact number of Shares that we will purchase until after the Expiration Date. See “Offer to Purchase – Number
of Shares and Pro-Ration”.
|
| What will happen if Shares with an aggregate Purchase Price of more than $40,000,000 are tendered in the Offer? |
If the aggregate Purchase Price for Shares properly tendered and not withdrawn pursuant to the Offer by Purchase Price Tender or by Auction Tender at or below the Purchase Price exceeds $40,000,000, then we will purchase the Successfully Tendered Shares on a pro rata basis according to the number of Shares tendered (or deemed to be tendered) by the Successful Shareholders (with adjustments to avoid the purchase of fractional Shares), except that “Odd Lot” tenders will not be subject to pro-ration. See “Offer to Purchase – Number of Shares and Pro-Ration”.
|
| What do I do if I own an “Odd Lot” of Shares? |
If you beneficially own fewer than 100 Shares as of the Expiration Date and you tender all such Shares, we will accept for purchase, without pro-ration but otherwise subject to the terms and conditions of the Offer, all of your Shares tendered pursuant to an Auction Tender at or below the Purchase Price or pursuant to a Purchase Price Tender. You should check the appropriate place in Box D – “Odd Lots” in the Letter of Transmittal. Furthermore, partial tenders will not qualify for this preference and this preference is not available to a Shareholder who holds separate certificates for fewer than 100 Shares or holds fewer than 100 Shares in different accounts if such Shareholder beneficially owns in the aggregate 100 or more Shares. See “Offer to Purchase – Number of Shares and Pro-Ration”.
|
| How can I maximize the chance that my Shares will be purchased? |
If you wish to maximize the chance that your Shares will be purchased, you should tender them by “Purchase Price Tender”, indicating that you will accept the Purchase Price that we select. You should understand that this election will have the same effect as if you have selected the minimum Purchase Price of $2.53 per Share.
|
| How will illumin pay for Shares? |
We intend to fund any purchases of Shares pursuant to the Offer from cash on hand. The Offer is not conditional upon the receipt of financing. See “Issuer Bid Circular – Source of Funds”.
|
| How long do I have to tender my Shares? |
You may tender your Shares until the Offer expires. The Offer will expire on August 30, 2023 at 5:00 p.m. (Eastern time), unless we extend it. We may choose to extend the Offer at any time and for any reason, subject to applicable laws. See “Offer to Purchase – Extension and Variation of the Offer”. If a broker, dealer, commercial bank, trust company or other nominee holds your Shares, it is likely that, for administrative reasons, it has an earlier deadline for you to act to instruct them to tender Shares on your behalf. We urge you to contact your broker, dealer, commercial bank, trust company or other nominee to confirm any earlier deadline. The Corporation will not provide for any subsequent offering period following the Expiration Date. See “Offer to Purchase – The Offer” and “Offer to Purchase – Extension and Variation of the Offer”.
|
| Are there any conditions to the Offer? |
Yes. The Offer is subject to a number of conditions, such as the absence of court and governmental action prohibiting the Offer and changes in general market conditions that, in our judgment, are or may be materially adverse to us. See “Offer to Purchase – Conditions of the Offer”.
|
| How do I tender my Shares? |
To tender Shares pursuant to the Offer, you must (i) deliver by the Expiration Date the certificates for all tendered Shares in proper form for transfer and/or Shares held through the Direct Registration System (“DRS”), together with a properly completed and duly executed Letter of Transmittal (with signatures that are guaranteed if so required in accordance with the Letter of Transmittal), and any other documents required by the Letter of Transmittal, to the Depositary, at one of the addresses listed in the Letter of Transmittal, (ii) follow the guaranteed delivery procedure described under “Offer to Purchase – Procedure for Tendering Shares”, or (iii) transfer all tendered Shares pursuant to the procedures for book-entry transfer described under “Offer to Purchase – Procedure for Tendering Shares”, prior to 5:00 p.m. (Eastern time) on the Expiration Date. If your Shares are held through a broker, dealer, commercial bank, trust company or other nominee, you must request that your broker, dealer, commercial bank, trust company or other nominee effect the transaction for you. If you wish to tender Shares held through DRS, you are only required to complete the Letter of Transmittal and have it delivered to the Depositary, and you do not need to obtain and deliver share certificates for these holdings. You may also contact the Depositary or the Dealer Managers for assistance. See “Offer to Purchase – Procedure for Tendering Shares” and the instructions to the related Letter of Transmittal.
|
| Can I tender part of my Shares at different prices? |
Yes. You can elect to tender your Shares in separate lots at a different price and/or different type of tender for each lot. However, you cannot tender the same Shares at different prices. If you tender some Shares at one price and other Shares at another price, you must use a separate Letter of Transmittal for each tender. See “Offer to Purchase – Procedure for Tendering Shares”.
|
| What is the recent trading price of Shares? |
On July 25, 2023, the date prior to the announcement of the Corporation’s intention to proceed with a substantial issuer bid, the closing price on the TSX was $2.37 per Share and on Nasdaq was US$1.81 per Share. Shareholders are urged to obtain current market quotations for Shares. The weighted average trading price of the Shares for the ten trading days ending July 25, 2023 was $2.41 per Share on the TSX and US$1.81 per Share on Nasdaq. See “Issuer Bid Circular – Price Range and Trading Volume of Shares”.
|
| What will happen if I do not tender my Shares? |
Upon the completion of the Offer, the non-tendering Shareholders will realize a proportionate increase in their relative ownership interest in illumin, subject to illumin’s right to issue additional Shares and other equity securities in the future. The amount of illumin’s future cash assets will be reduced and/or its liabilities increased by the amount paid and expenses incurred in connection with the Offer. See “Issuer Bid Circular – Purpose and Effect of the Offer”.
|
| Once I have tendered Shares in the Offer, can I withdraw my tender? |
Yes. You may withdraw any Shares you have tendered (i) at any time prior to the Expiration Date, (ii) at any time if Shares have not been taken up by the Corporation before actual receipt by the Depositary of a notice of withdrawal in respect of such Shares, (iii) at any time after 40 business days from the commencement of the Offer if the Corporation has not yet accepted Shares for payment, (iv) if Shares have not been paid for by the Corporation within three business days of being taken up, and (v) as otherwise described in “Offer to Purchase – Withdrawal Rights”. See “Offer to Purchase – Withdrawal Rights”.
|
| How do I withdraw Shares I previously tendered? |
You must deliver, on a timely basis, a written or printed notice of your withdrawal to the Depositary at the address appearing on the back cover page of this document. A notice of withdrawal must specify your name, the number of Shares to be withdrawn and the name of the registered holder of the withdrawn Shares. Some additional requirements apply if the Share certificates to be withdrawn have been delivered to the Depositary or if your Shares have been tendered under the procedure for book-entry transfer. See “Offer to Purchase – Withdrawal Rights”.
|
| What is the accounting treatment to the Corporation of the Offer? |
The accounting treatment for the Corporation’s purchase of Shares in the Offer will result in a reduction in the Corporation’s share capital by an amount equal to the number of Shares purchased pursuant to the Offer multiplied by the average carrying amount of Shares, with any excess allocated to retained earnings. See “Issuer Bid Circular – Accounting Treatment of the Offer”.
|
| Can the Offer be withdrawn, extended or varied? |
Yes. Subject to applicable laws, we may extend or vary the Offer in our sole discretion prior to the Expiration Date. See “Offer to Purchase – Extension and Variation of the Offer”. We may also terminate the Offer under certain circumstances. See “Offer to Purchase – Conditions of the Offer”.
|
| How will I be notified if illumin extends the Offer? |
We will issue a news release by 9:00 a.m. (Eastern time) on the business day after the previously scheduled Expiration Date if we decide to extend the Offer. See “Offer to Purchase – Extension and Variation of the Offer”.
|
| Has illumin, its Board of Directors or the Dealer Managers adopted a position on the Offer? |
Our Board of Directors has approved the Offer. However, none of illumin, its Board of Directors, the Dealer Managers or the Depositary makes any recommendation to you or to any other Shareholders as to whether to tender or refrain from tendering Shares under the Offer, whether Shareholders should elect an Auction Tender or a Purchase Price Tender, or as to the purchase price or purchase prices at which you or any other Shareholders may tender Shares under the Offer. You must make your own decisions as to whether to tender Shares under the Offer, and, if so, how many Shares to tender and the price or prices at which to tender. Our directors and executive officers do not intend to tender Shares pursuant to the Offer. You should carefully consider all relevant factors with your own financial advisor, including the income tax consequences of tendering Shares under the Offer.
|
| Following the Offer, will illumin continue as a public corporation? |
Yes. The purchase of Shares through the Offer will not cause our remaining Shares to be delisted from Nasdaq or the TSX or cause us to be eligible for deregistration under the Exchange Act. However, separately, the Corporation has re-evaluated the continued benefits and costs of its listing on Nasdaq and has concluded that it is appropriate to delist from Nasdaq as soon as practical following the expiry of the Offer. The Corporation expects that its Shares will be eligible for quotation on the OTC Markets following such delisting. See “Issuer Bid Circular – Purpose and Effect of the Offer”.
|
| What impact will the Offer have on the liquidity of the market for Shares? |
We believe that, following completion of the Offer,
there will be a market for holders of Shares who do not tender their Shares to the Offer that is not materially less liquid than the market
that existed at the time of the making of the Offer. Our Board of Directors has obtained the Liquidity Opinion from Canaccord Genuity
to the effect that, based on and subject to the assumptions and limitations stated in the Liquidity Opinion, there is a liquid market
for Shares as of July 26, 2023 and that it is reasonable to conclude that, following the completion of the Offer in accordance with its
terms, there will be a market for holders of Shares who do not tender to the Offer that is not materially less liquid than the market
that existed at the time of the making of the Offer. A copy of the Liquidity Opinion is attached hereto as Schedule A.
See “Issuer Bid Circular – Purpose
and Effect of the Offer – Liquidity of Market”.
|
| When will illumin pay for Shares I tender? |
We will pay the Purchase Price (less applicable withholding taxes, if any) to Shareholders in cash, without interest, for Shares we purchase promptly after the expiration of the Offer. In the event of pro-ration, we do not expect to be able to commence payment for Shares until at least three business days after the Expiration Date. See “Offer to Purchase – Taking Up and Payment for Tendered Shares”.
|
| In what currency will illumin pay for Shares I tender? |
The Purchase Price and the amount payable to the tendering Shareholders (net of applicable withholding taxes, if any) will be denominated in Canadian dollars and illumin will pay for Shares you tender in Canadian dollars. See “Offer to Purchase – Taking Up and Payment for Tendered Shares”.
|
| Will I have to pay brokerage commissions if I tender my Shares? |
If you are a registered Shareholder and you tender your Shares directly to the Depositary, you will not incur any brokerage commissions. If you hold Shares through a broker, dealer, commercial bank, trust company or other nominee, we urge you to consult your broker, dealer, commercial bank, trust company or other nominee to determine whether transaction costs are applicable. See “Offer to Purchase – Taking Up and Payment for Tendered Shares”.
|
| How do holders of vested but unexercised Options participate in the Offer? |
The Offer is made only for Shares and not made for any Options. Any holder of Options who wishes to accept the Offer should, to the extent permitted by the terms thereof, duly exercise such Options in order to tender the resulting Shares in accordance with the terms and conditions of the Offer. Any such exercise must occur sufficiently in advance of the Expiration Date to assure holders of Options that they will have sufficient time to comply with the procedures for tendering Shares in the Offer. An exercise of an Option cannot be revoked even if Shares received upon exercise thereof and tendered in the Offer are not purchased in the Offer for any reason. Holders of such Options that exercise such Options and then tender Shares received on such exercise pursuant to the Offer could suffer adverse tax consequences. The tax consequences of such an exercise are not described under “Issuer Bid Circular – Income Tax Consequences”. Holders of Options are urged to seek tax advice from their own tax advisors in this regard.
|
| What are the income tax consequences if I tender my Shares? |
You should carefully consider the income tax consequences of tendering Shares under the Offer, as these consequences may be different than selling Shares through the facilities of the TSX or Nasdaq for a particular Shareholder. We also urge you to seek advice from your own tax advisors as to the specific tax consequences you may incur as a result of our purchase of your Shares under the Offer. See “Issuer Bid Circular – Income Tax Consequences”.
|
| Who can I talk to if I have questions? |
The Depositary or the Dealer Managers can help answer your questions. The Depositary is TSX Trust Company, and the Dealer Managers are Canaccord Genuity in Canada and Canaccord Genuity US in the United States. Contact information for the Depositary and the Dealer Managers is set forth on the back cover of this document.
|
| How do I get my Shares back if I have tendered them to the Offer but they are not purchased? |
All tendered Shares not purchased, including all Shares tendered pursuant to Auction Tenders at prices greater than the Purchase Price, Shares not purchased due to pro-ration and Shares not accepted for purchase, will be returned to the tendering Shareholder promptly after the Expiration Date or termination of the Offer without expense to the tendering Shareholder.
|
NO PERSON HAS BEEN AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF THE CORPORATION OR THE BOARD OF DIRECTORS AS TO WHETHER SHAREHOLDERS SHOULD TENDER OR REFRAIN FROM TENDERING SHARES PURSUANT TO THE OFFER OR WHETHER SHAREHOLDERS SHOULD ELECT AN AUCTION TENDER OR A PURCHASE PRICE TENDER. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THE OFFER OTHER THAN AS SET FORTH IN THIS OFFER. IF GIVEN OR MADE, ANY SUCH RECOMMENDATION OR ANY SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE CORPORATION, THE BOARD OF DIRECTORS, THE DEALER MANAGERS OR THE DEPOSITARY.
|
OFFER
TO PURCHASE
To Shareholders of illumin Holdings Inc.:
The Corporation hereby offers to purchase for
cancellation Shares pursuant to (i) Auction Tenders in which the tendering Shareholders specify a price of not less than $2.53 per Share
and not more than $2.65 per Share in increments of $0.01 per Share, or (ii) Purchase Price Tenders, in either case on the terms and subject
to the conditions set forth in this Offer to Purchase, the Circular and the related Letter of Transmittal and the Notice of Guaranteed
Delivery.
The Offer commences on the date of this Offer
to Purchase and will expire at 5:00 p.m. (Eastern time) on August 30, 2023, unless withdrawn, extended or varied by illumin. Beneficial
owners should be aware that their broker, dealer, commercial bank, trust company or other nominee may establish its own earlier deadlines
for participation in the Offer. The Offer is not conditional upon the receipt of financing or any minimum number of Shares being tendered.
The Offer is, however, subject to other conditions and illumin reserves the right, subject to applicable laws, to withdraw the Offer and
not take up and pay for any Shares tendered under the Offer if certain events occur. See “Offer to Purchase – Conditions of
the Offer”.
Each Shareholder who has properly tendered Shares
pursuant to an Auction Tender at or below the Purchase Price or pursuant to a Purchase Price Tender, and who has not properly withdrawn
such Shares, will receive the Purchase Price, payable in cash (subject to applicable withholding taxes, if any), for all Shares purchased,
on the terms and subject to the conditions of the Offer, including the provisions relating to pro-ration described herein.
The Corporation will return all Shares not purchased
under the Offer, including Shares tendered pursuant to an Auction Tender at prices greater than the Purchase Price and Shares not purchased
because of pro-ration, promptly after the Expiration Date.
The Offer is made only for Shares and is not made
for any Options to acquire Shares. Any holder of Options who wishes to accept the Offer should, to the extent permitted by the terms thereof,
duly exercise such Options in order to tender the resulting Shares in accordance with the terms and conditions of the Offer. Any such
exercise must occur sufficiently in advance of the Expiration Date to assure holders of Options that they will have sufficient time to
comply with the procedures for tendering Shares in the Offer as described under “Offer to Purchase – Procedure for Tendering
Shares”. An exercise of an Option cannot be revoked even if Shares received upon exercise thereof and tendered in the Offer are
not purchased in the Offer for any reason. Holders of Options that exercise such Options and then tender Shares received on such exercise
pursuant to the Offer could suffer adverse tax consequences. The tax consequences of such an exercise are not described under “Issuer
Bid Circular – Income Tax Consequences”. Holders of Options are urged to seek tax advice from their own tax advisors in this
regard.
The Corporation’s Board of Directors has
approved the Offer. However, none of illumin, its Board of Directors, the Dealer Managers or the Depositary makes any recommendation to
any Shareholder as to whether to tender or refrain from tendering Shares under the Offer, whether Shareholders should elect an Auction
Tender or a Purchase Price Tender, or as to the purchase price or purchase prices at which Shareholders may tender Shares under the Offer.
Shareholders must make their own decisions as to whether to tender Shares under the Offer, and, if so, how many Shares to tender and the
price or prices at which to tender. None of the Corporation’s directors and executive officers intend to tender any of their Shares
pursuant to the Offer.
Shareholders should carefully consider all
relevant factors with their own financial advisors, including the income tax consequences of tendering Shares under the Offer. For some
Shareholders, the income tax treatment of tendering Shares to the Offer may be materially different from the income tax treatment of selling
Shares in the market. See “Issuer Bid Circular – Income Tax Consequences”.
The accompanying Circular, Letter of Transmittal
and Notice of Guaranteed Delivery contain important information and should be read carefully and in their entirety before making a decision
with respect to the Offer.
Promptly following the Expiration Date, the Corporation
will determine a single Purchase Price per Share, which will not be less than $2.53 per Share and not more than $2.65 per Share, that
is the lowest price that enables it to purchase the maximum number of Shares properly tendered and not withdrawn pursuant to the Offer
having an aggregate Purchase Price not exceeding $40,000,000. For the purpose of determining the Purchase Price, Shares tendered pursuant
to a Purchase Price Tender will be considered to have been tendered at $2.53 per Share (which is the minimum Purchase Price under the
Offer).
Upon determination of the Purchase Price, the
Corporation will publicly announce the Purchase Price for Shares, and upon the terms and subject to the conditions of the Offer (including
the pro-ration provisions described herein), all Shareholders who have properly tendered and not withdrawn their Shares either pursuant
to Auction Tenders at prices at or below the Purchase Price or pursuant to Purchase Price Tenders will receive the Purchase Price, payable
in cash (but subject to applicable withholding taxes, if any), for all Shares purchased. The Purchase Price will be denominated in Canadian
dollars and payments of amounts owing to a tendering Shareholder will be made in Canadian dollars. See “Offer to Purchase –
Taking Up and Payment for Tendered Shares”.
| 3. | Number of Shares and Pro-Ration |
The Corporation will purchase, upon the terms
and subject to the conditions of the Offer, at the Purchase Price, deposited Shares up to a maximum aggregate Purchase Price not exceeding
$40,000,000. Since the Purchase Price will only be determined after the Expiration Date, the number of Shares that will be purchased will
not be known until after the Expiration Date. If the Purchase Price is determined to be $2.53 per Share, the minimum Purchase Price pursuant
to the Offer, the maximum number of Shares that will be purchased pursuant to the Offer is 15,810,276. If the Purchase Price is determined
to be $2.65 per Share, the maximum Purchase Price pursuant to the Offer, the maximum number of Shares that will be purchased pursuant
to the Offer is 15,094,339.
As of July 25, 2023, there were 56,185,631 Shares
issued and outstanding and, accordingly, the Offer is for a maximum of approximately 28.14% of the total number of issued and outstanding
Shares if the Purchase Price is determined to be $2.53 (being the minimum Purchase Price under the Offer). If the Purchase Price is determined
to be $2.65 (which is the maximum Purchase Price under the Offer), the Offer is for a maximum of approximately 26.87% of the total number
of issued and outstanding Shares.
If the aggregate Purchase Price of the Successfully
Tendered Shares does not exceed $40,000,000, the Corporation will, upon the terms and subject to the conditions of the Offer, purchase
all Successfully Tendered Shares at the Purchase Price. If the aggregate Purchase Price of the Successfully Tendered Shares exceeds $40,000,000,
the Corporation will accept Shares for purchase first from all Successful Shareholders who are Odd Lot Holders (as defined below). With
respect to the Successful Shareholders who are not Odd Lot Holders, the Corporation will accept Shares for purchase at the Purchase Price
on a pro rata basis according to the number of Successfully Tendered Shares, less the number of Shares purchased from Odd Lot Holders
(with adjustments to avoid the purchase of fractional Shares).
For purposes of the Offer, the term “Odd
Lots” means all Successfully Tendered Shares tendered by or on behalf of the Successful Shareholders who individually beneficially
own, as of the close of business on the Expiration Date, an aggregate of fewer than 100 Shares (“Odd Lot Holders”).
As set forth above, Odd Lots will be accepted for purchase before any pro-ration. In order to qualify for this preference, an Odd Lot
Holder must properly tender, pursuant to an Auction Tender at a price at or below the Purchase Price or pursuant to a Purchase Price Tender,
all Shares beneficially owned by such Odd Lot Holder. Partial tenders will not qualify for this preference. Furthermore, partial tenders
will not qualify for this preference and this preference is not available to a Shareholder who holds separate certificates for fewer than
100 Shares or holds fewer than 100 Shares in different accounts if such Shareholder beneficially owns in the aggregate 100 or more Shares.
Any Odd Lot Holder wishing to tender all Shares beneficially owned, without pro-ration, must complete the appropriate box on the Letter
of Transmittal and, if applicable, on the Notice of Guaranteed Delivery. Shareholders owning an aggregate of less than 100 Shares whose
Shares are purchased pursuant to the Offer not only will avoid the payment of brokerage commissions, but will also avoid any odd lot discounts,
each of which may be applicable on a sale of their Shares in a transaction on the TSX or Nasdaq.
| 4. | Announcement of Purchase Price, Number of Shares Validly Tendered and Aggregate Purchase Price |
The Corporation will publicly announce the Purchase
Price, the number of Shares validly tendered to the Offer and the aggregate Purchase Price promptly after the Expiration Date.
| 5. | Procedure for Tendering Shares |
| 5.1 | Proper Tender of Shares |
To tender Shares pursuant to the Offer, (i) the
certificates for all tendered Shares in proper form for transfer and/ or Shares held through DRS, together with a properly completed and
duly executed Letter of Transmittal (or a manually executed photocopy thereof) relating to such Shares with signatures that are guaranteed
if so required in accordance with the Letter of Transmittal, and any other documents required by the Letter of Transmittal, must be received
by the Depositary at one of the addresses listed in the Letter of Transmittal by the Expiration Date, (ii) the guaranteed delivery procedure
described below must be followed, or (iii) such Shares must be transferred pursuant to the procedures for book-entry transfer described
below (and a confirmation of such tender must be received by the Depositary, including either a Book-Entry Confirmation or an Agent’s
Message (each as defined below) if the tendering Shareholder has not delivered a Letter of Transmittal). If you wish to tender Shares
held through DRS, you are only required to complete the Letter of Transmittal and have it delivered to the Depositary, and you do not
need to obtain and deliver share certificates for these holdings. The term “Agent’s Message” means a message,
transmitted by the Depositary Trust Company (“DTC”) to and received by the Depositary and forming a part of a Book-Entry
Confirmation, which states that DTC has received an express acknowledgment from the tendering participant, which acknowledgment states
that such participant has received and agrees to be bound by the Letter of Transmittal and that the Corporation may enforce such Letter
of Transmittal against such participant. The term “Book-Entry Confirmation” means a confirmation of a book-entry transfer
of a Shareholder’s Shares into the Depositary’s account at CDS Clearing and Depositary Services Inc. (“CDS”).
In accordance with Instruction 5 in the Letter
of Transmittal or the Book-Entry Confirmation or Agent’s Message in lieu thereof, (i) each Shareholder desiring to tender Shares
pursuant to the Offer must indicate in the appropriate box on such Letter of Transmittal or the Book-Entry Confirmation or Agent’s
Message in lieu thereof, whether the Shareholder is tendering Shares pursuant to an Auction Tender or a Purchase Price Tender, and (ii)
each Shareholder desiring to tender Shares pursuant to an Auction Tender must further indicate, in the appropriate box in such Letter
of Transmittal or the Book-Entry Confirmation or Agent’s Message in lieu thereof, the price per Share (in increments of $0.01 per
Share) at which such Shares are being tendered. Under each of (i) and (ii) respectively, only one box may be checked. If a Shareholder
desires to tender Shares in separate lots at a different price and/or different type of tender for each lot, such Shareholder must complete
a separate Letter of Transmittal or Book-Entry Confirmation or Agent’s Message in lieu thereof (and, if applicable, a Notice of
Guaranteed Delivery) for each lot. The same Shares cannot be tendered (unless previously properly withdrawn) pursuant to both an Auction
Tender and a Purchase Price Tender, or pursuant to an Auction Tender at more than one price. Shareholders who tender Shares without making
a valid Auction Tender or Purchase Price Tender will be deemed to have made a Purchase Price Tender. In addition, Odd Lot Holders who
tender all their Shares must complete the appropriate box in the Letter of Transmittal in order to qualify for the preferential treatment
available to Odd Lot Holders as set forth in “Offer to Purchase – Number of Shares and Pro-Ration”.
No signature guarantee is required on the Letter
of Transmittal if either (i) the Letter of Transmittal is signed by the registered holder of Shares exactly as the name of the registered
holder appears on DRS or the share certificate tendered therewith, and payment and delivery are to be made directly to such registered
holder, or (ii) Shares are tendered for the account of a Canadian Schedule I chartered bank, a member of the Securities Transfer Agents
Medallion Program (STAMP), a member of the Stock Exchanges Medallion Program (SEMP) or a member of the New York Stock Exchange Inc. Medallion
Signature Program (MSP) (each such entity, an “Eligible Institution”). Members of these programs are usually members
of a recognized stock exchange in Canada or the United States, members of the Investment Industry Regulatory Organization of Canada, members
of the Financial Industry Regulatory Authority or banks and trust companies in the United States. In all other cases, all signatures on
the Letter of Transmittal must be guaranteed by an Eligible Institution. See Instruction 7 in the Letter of Transmittal.
If a certificate or DRS representing Shares is
registered in the name of a person other than the signatory to a Letter of Transmittal, or if payment is to be made, or certificates or
DRS representing Shares not purchased or tendered are to be returned or issued to a person other than the registered holder, the certificate
or DRS must be endorsed or accompanied by an appropriate stock power, in either case, signed exactly as the name of the registered holder
appears on the certificate or DRS with the signature on the certificate or stock power signature guaranteed by an Eligible Institution.
An ownership declaration, which can be obtained from the Depositary, must also be completed and delivered to the Depositary.
A Shareholder who wishes to tender Shares under
the Offer and whose Shares are registered in the name of a broker, dealer, commercial bank, trust company or other nominee should immediately
contact such nominee in order to take the necessary steps to be able to tender such Shares under the Offer. Participants of CDS and DTC
should contact the Depositary with respect to the tender of their Shares under the terms of the Offer.
| 5.3 | Book-Entry Transfer Procedures – CDS |
Any financial institution that is a participant
in CDS may make book-entry delivery of Shares through the CDS online tendering system pursuant to which book-entry transfers may be effected
(“CDSX”) by causing CDS to transfer such Shares to the Depositary in accordance with the applicable CDS procedures.
Delivery of Shares to the Depositary by means of a book-entry transfer through CDSX will constitute a valid tender under the Offer.
Shareholders may accept the Offer by following
the procedures for a book-entry transfer established by CDS, provided that a Book-Entry Confirmation through CDSX is received by the Depositary
at its office in Toronto, Ontario prior to the Expiration Date. Shareholders, through their respective CDS participants, who utilize CDSX
to accept the Offer via a book-entry transfer of their holdings with CDS, shall be deemed to have completed and submitted a Letter of
Transmittal and to be bound by the terms thereof and therefore such instructions received by the Depositary are considered to be a valid
tender in accordance with the terms of the Offer. Delivery of documents to CDS does not constitute delivery to the Depositary.
| 5.4 | Book-Entry Transfer Procedures – DTC |
Any financial institution that is a participant
in DTC may make book-entry delivery of Shares through DTC’s online tendering system pursuant to which book-entry transfers may be
effected (“ATOP”) by causing DTC to transfer such Shares into the Depositary’s account at DTC in accordance with
DTC’s procedures. Delivery of Shares to the Depositary by means of a book-entry transfer through ATOP will constitute a valid tender
under the Offer.
Shareholders may accept the Offer by following
the procedures for a book-entry transfer established by DTC, provided that an Agent’s Message through ATOP is received by the Depositary
at its office in Toronto, Ontario prior to the Expiration Date. Shareholders, through their respective DTC participants, who accept the
Offer via a book-entry transfer of their holdings into the Depositary’s account at DTC, shall be deemed to have completed and submitted
a Letter of Transmittal and to be bound by the terms thereof and therefore such instructions received by the Depositary are considered
to be a valid tender in accordance with the terms of the Offer. Delivery of documents to DTC does not constitute delivery to the Depositary.
The method of delivery of certificates representing
Shares and all other required documents is at the option and risk of the tendering Shareholder. If certificates representing Shares are
to be sent by mail, registered mail that is properly insured is recommended and it is suggested that the mailing be made sufficiently
in advance of the Expiration Date to permit delivery to the Depositary on or prior to such date. Delivery of a share certificate representing
Shares will only be made upon actual receipt of the share certificate representing such Shares by the Depositary.
| 5.6 | Lost or Stolen Certificates |
If any certificate representing Shares has been
lost or destroyed, the Shareholder should promptly notify the Depositary at the phone number or address set forth on the back cover page
of this document. The Shareholder will then be instructed as to the steps that must be taken in order to replace the certificate(s). The
Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost or destroyed certificates have
been followed, and in such circumstances, a longer period of time may be needed to complete a tender of Shares. Shareholders are urged
to contact the Depositary immediately in order to permit timely processing of this documentation.
If a Shareholder wishes to tender Shares pursuant
to the Offer and cannot deliver certificates for such Shares, or the book-entry transfer procedures described above cannot be completed,
prior to the Expiration Date, or time will not permit all required documents to reach the Depositary by the Expiration Date, such Shares
may nevertheless be tendered if all of the following conditions are met:
| (a) | such tender is made by or through an Eligible Institution; |
| (b) | a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form provided
by the Corporation through the Depositary, is received by the Depositary, at its office in Toronto, Ontario as set out in the Notice of
Guaranteed Delivery, by the Expiration Date; and |
| (c) | all tendered Shares (including original share certificates, if such Shares are held in certificated form)
in proper form for transfer, together with a properly completed and duly executed Letter of Transmittal (or a manually executed photocopy
thereof) or, in the case of a book-entry transfer, a Book-Entry Confirmation or Agent’s Message in lieu thereof relating to such
Shares, with signatures that are guaranteed if so required in accordance with the Letter of Transmittal, and any other documents required
by the Letter of Transmittal, are received by the Toronto office of the Depositary, before 5:00 p.m. (Eastern time) on or before the second
trading day on the TSX and Nasdaq after the Expiration Date. |
The Notice of Guaranteed Delivery may be hand
delivered, couriered, mailed or transmitted by facsimile transmission to the Toronto office of the Depositary listed in the Notice of
Guaranteed Delivery, and must include a guarantee by an Eligible Institution in the form set forth in the Notice of Guaranteed Delivery.
Notwithstanding any other provision hereof, payment
for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of (i) certificates
for such Shares, or timely confirmation of the book-entry transfer of such Shares, (ii) a properly completed and duly executed Letter
of Transmittal (or a manually executed photocopy thereof) relating to such Shares, with signatures that are guaranteed if so required,
or a Book-Entry Confirmation or Agent’s Message in the case of a book-entry transfer, and (iii) any other documents required by
the Letter of Transmittal.
The tender information specified in a Notice of
Guaranteed Delivery by a person completing such Notice of Guaranteed Delivery will, in all circumstances, take precedence over the tender
information that is specified in the related Letter of Transmittal that is subsequently tendered.
| 5.8 | Return of Unpurchased Shares |
All tendered Shares not purchased, including all
Shares tendered pursuant to Auction Tenders at prices greater than the Purchase Price, Shares not purchased due to pro-ration and Shares
not accepted for purchase, will be returned to the tendering Shareholder promptly after the Expiration Date or termination of the Offer
without expense to the tendering Shareholder.
In the case of Shares tendered through book-entry
transfer into the Depositary’s account at DTC or CDS, Shares will be credited to the appropriate account maintained by the tendering
Shareholder at DTC or CDS, as applicable, without expense to the Shareholder.
| 5.9 | Determination of Validity, Rejection and Notice of Defect |
All questions as to the number of Shares to be
taken up, the price to be paid therefore, the form of documents and the validity, eligibility (including time of receipt) and acceptance
for payment of any tender of Shares will be determined by the Corporation, in its sole discretion, which determination will be final and
binding on all parties, except as otherwise finally determined by a court of competent jurisdiction or as required by law. The Corporation
reserves the absolute right to reject any tenders of Shares determined by it in its sole discretion not to be in proper form or completed
in accordance with the instructions set forth herein and in the Letter of Transmittal or the acceptance for payment of, or payment for,
which may, in the opinion of the Corporation’s counsel, be unlawful. The Corporation also reserves the absolute right to waive any
of the conditions of the Offer or any defect or irregularity in the tender of any particular Shares. Unless waived, any defects or irregularities
in connection with tenders must be cured within such time as the Corporation shall determine. No individual tender of Shares will be deemed
to be properly made until all defects and irregularities have been cured or waived. None of the Corporation, the Depositary, the Dealer
Managers or any other person will be obligated to give notice of defects or irregularities in tenders, nor shall any of them incur any
liability for failure to give any such notice. The Corporation’s interpretation of the terms and conditions of the Offer (including
the Letter of Transmittal and the Notice of Guaranteed Delivery) will be final and binding, except as otherwise finally determined by
a court of competent jurisdiction or as required by law.
Under no circumstances will interest accrue or
be paid by the Corporation by reason of any delay in making payment to any person, including persons using the guaranteed delivery procedures,
and the payment for Shares tendered pursuant to the guaranteed delivery procedures will be the same as that for Shares delivered to the
Depositary on or prior to the Expiration Date, even if Shares to be delivered pursuant to the guaranteed delivery procedures are not so
delivered to the Depositary, and therefore payment by the Depositary on account of such Shares is not made, until after the date the payment
for the tendered Shares accepted for payment pursuant to the Offer is to be made by the Corporation.
| 5.10 | Formation of Agreement; Prohibition on “Short”
Tenders |
A proper tender of Shares pursuant to any one
of the procedures described above will constitute a binding agreement between the tendering Shareholder and the Corporation, effective
as of the Expiration Date, upon the terms and subject to the conditions of the Offer. Such agreement will be governed by and construed
in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein.
In addition, a tender of Shares to illumin pursuant
to any procedures described herein will constitute a representation by such Shareholder that (i) such Shareholder has a “net long
position” in Shares being tendered or equivalent securities at least equal to Shares tendered within the meaning of Rule 14e-4 of
the Exchange Act and (ii) the tender of such Shares complies with Rule 14e-4. It is a violation of Section 14(e) of the Exchange Act and
of Rule 14e-4 promulgated thereunder for a person, directly or indirectly, to tender Shares for that person’s own account unless,
at the time of tender and at the end of the pro-ration period or period during which Shares are accepted by lot (including any extensions
thereof), the person so tendering has a net long position equal to or greater than (A) the amount of Shares tendered or (B) other securities
immediately convertible into, or exchangeable or exercisable for, the amount of Shares tendered and upon acceptance of such person’s
tender, will acquire such Shares for tender by conversion, exchange or exercise of such other securities and will deliver or cause to
be delivered
Shares in accordance with the terms of the Offer.
Section 14(e) and Rule 14e-4 provide a similar restriction applicable to the tender or guarantee of a tender on behalf of another person.
Except as otherwise provided in this Section,
tenders of Shares pursuant to the Offer will be irrevocable. Shares tendered pursuant to the Offer may be withdrawn by the Shareholder
in any of the following circumstances:
| (a) | at any time prior to the Expiration Date; |
| (b) | at any time if Shares have not been taken up by the Corporation before actual receipt by the Depositary
of a notice of withdrawal in respect of such Shares; |
| (c) | if Shares have not been paid for by the Corporation within three business days of being taken up; and/or |
| (d) | as required by Section 2.30(2) of National Instrument 62-104 – Take-Over Bids and Issuer Bids and
without limiting the withdrawal rights set out in clauses (a) through (d), at any time before the expiration of 10 days from the date
that a notice of change or notice of variation has been given in accordance with this Offer to Purchase (other than a variation that (i)
consists solely of an increase in the consideration offered for Shares under the Offer where the time for deposit is not extended for
greater than 10 days, or (ii) consists solely of the waiver of a condition of the Offer), unless Shares tendered pursuant to the Offer
have been taken up by the Corporation before the date of the notice of change or variation. See “Offer to Purchase – Extension
and Variation of the Offer”. In addition, pursuant to Rule 13e-4(f) under the Exchange Act, Shares may also be withdrawn after September
22, 2023, which is the 40th business day after the date of the commencement of the Offer, unless such Shares have already been
accepted for payment by the Corporation pursuant to the Offer and not validly withdrawn. |
For a withdrawal to be effective, a written or
printed copy of a notice of withdrawal must be actually received by the Depositary by the applicable date specified above at the place
of tender of the relevant Shares. Any such notice of withdrawal must (i) be signed by or on behalf of the person who signed the Letter
of Transmittal that accompanied Shares being withdrawn or, in the case of Shares tendered by a CDS or DTC participant, be signed by such
participant in the same manner as the participant’s name is listed on the applicable Book-Entry Confirmation or Agent’s Message,
or be accompanied by evidence sufficient to the Depositary that the person withdrawing the tender has succeeded to the beneficial ownership
of Shares, and (ii) specify the name of the person who tendered Shares to be withdrawn, the name of the registered holder, if different
from that of the person who tendered such Shares, and the number of Shares to be withdrawn. If the certificates for Shares tendered pursuant
to the Offer have been delivered or otherwise identified to the Depositary, then, prior to the release of such certificates, the tendering
Shareholder must submit the serial numbers shown on the particular certificates evidencing Shares to be withdrawn and the signature on
the notice of withdrawal must be guaranteed by an Eligible Institution, except in the case of Shares tendered by an Eligible Institution.
A withdrawal of Shares tendered pursuant to the Offer can only be accomplished in accordance with the foregoing procedures. The withdrawal
shall take effect only upon actual receipt by the Depositary of a properly completed and executed notice of withdrawal in writing.
A Shareholder who wishes to withdraw Shares
under the Offer and who holds Shares through a broker, dealer, commercial bank, trust company or other nominee should immediately contact
such broker, dealer, commercial bank, trust company or other nominee in order to take the necessary steps to be able to withdraw such
Shares under the Offer. Participants of CDS and DTC should contact such Depositary with respect to the withdrawal of Shares under the
Offer.
All questions as to the form and validity (including
time of receipt) of notices of withdrawal will be determined by the Corporation, in its sole discretion, which determination shall be
final and binding, except as otherwise finally determined by a court of competent jurisdiction or as required by law. None of the Corporation,
the Depositary, the Dealer Managers nor any other person will be obligated to give notice of defects or irregularities in notices of withdrawal,
nor shall any of them incur any liability for failure to give any such notice.
Any Shares properly withdrawn will thereafter
be deemed not tendered for purposes of the Offer. However, withdrawn Shares may be re-tendered prior to the Expiration Date by again following
the procedures described herein.
If illumin extends the period of time during which
the Offer is open, is delayed in its purchase of Shares or is unable to purchase Shares pursuant to the Offer for any reason, then, without
prejudice to illumin’s rights under the Offer, the Depositary may, subject to applicable law, retain on behalf of illumin all tendered
Shares. In the event of such retention, such Shares may not be withdrawn except to the extent the tendering Shareholders are entitled
to withdrawal rights as described under this Section.
| 7. | Conditions of the Offer |
The Offer is not conditional on the receipt of
financing or any minimum number of Shares being tendered. Notwithstanding any other provision of the Offer, illumin shall not be required
to accept for purchase, to purchase or to pay for any Shares tendered, and may withdraw, extend or vary the Offer or may postpone the
acceptance for payment of or the payment for Shares tendered (subject to Exchange Act Rule 13e-4(f)(5), which requires that illumin must
return Shares tendered promptly after termination or withdrawal of the Offer), if, at any time before the Expiration Date, any of the
following events shall have occurred (or shall have been determined by illumin to have occurred) which, in the Corporation’s sole
judgment, acting reasonably, in any such case and regardless of the circumstances giving rise to the event or events, makes it inadvisable
to proceed with the Offer or with such acceptance for purchase or payment:
| (a) | there shall have been threatened, taken or pending any action, suit or proceeding by any government or
governmental authority or regulatory or administrative agency in any jurisdiction, or by any other person in any jurisdiction, before
any court or governmental authority or regulatory or administrative agency in any jurisdiction (i) challenging or seeking to cease trade,
make illegal, delay or otherwise directly or indirectly restrain or prohibit the making of the Offer, the acceptance for payment of some
or all Shares by the Corporation or otherwise directly or indirectly relating in any manner to or affecting the Offer, or (ii) that otherwise,
in the sole judgment of the Corporation, acting reasonably, has or may have a material adverse effect on Shares, business, income, assets,
liabilities, condition (financial or otherwise), properties, operations, results of operations or prospects of the Corporation and its
subsidiaries taken as a whole or has impaired or may materially impair the contemplated benefits of the Offer to the Corporation; |
| (b) | there shall have been any action or proceeding threatened, pending or taken or approval withheld or any
statute, rule, regulation, stay, decree, judgment or order or injunction proposed, sought, enacted, enforced, promulgated, amended, issued
or deemed applicable to the Offer or the Corporation or any of its subsidiaries by or before any court, government or governmental authority
or regulatory or administrative agency in any jurisdiction that, in the sole judgment of the Corporation, acting reasonably, might directly
or indirectly result in any of the consequences referred to in clauses (i) or (ii) of paragraph (a) above or would or might prohibit,
prevent, restrict or delay consummation of the Offer or materially impair the contemplated benefits to us of the Offer; |
| (c) | there shall have occurred (i) any general suspension of trading in, or limitation on prices for, securities
on any securities exchange or in the over-the-counter market in Canada or the United States, (ii) the declaration of a banking moratorium
or any suspension of payments in respect of banks in Canada or the United States (whether or not mandatory), (iii) a natural disaster
or the commencement of a war, armed hostilities or other international or national calamity directly or indirectly involving Canada, the
United States or any other region where the Corporation maintains significant business activities, (iv) any limitation by any government
or governmental authority or regulatory or administrative agency or any other event that, in the sole judgment of the Corporation, acting
reasonably, might affect the extension of credit by banks or other lending institutions, (v) any material change in short term or long
term interest rates, (vi) any change in the general political, market, economic or financial conditions (including, without limitation,
any change in commodity prices) that, in our sole judgment, acting reasonably, has or may have a material adverse effect on the Corporation’s
business, operations or prospects or the trading in, or value of, Shares, (vii) any decline in any of the S&P/TSX Composite Index,
the Nasdaq Composite Index, the Dow Jones Industrial Average or the S&P 500 Index by an amount in excess of 10%, measured from the
close of business on July 25, 2023, or (viii) in the case of any of the foregoing existing at the time of the commencement of the Offer,
an acceleration or worsening thereof; |
| (d) | there shall have occurred a material change in U.S. or any other currency exchange rates or a suspension
or limitation on the markets for such currencies that could have, in the Corporation’s reasonable judgment, a material adverse effect
on the business, properties, assets, liabilities, capitalization, shareholders’ equity, financial condition (or otherwise), operations,
results of operations or prospects of the Corporation and its subsidiaries, taken as a whole, or on the trading in Shares; |
| (e) | there shall have occurred any change or changes (or any development involving any prospective change or
changes) in the business, earnings, assets, liabilities, properties, condition (financial or otherwise), operations, results of operations
or prospects of the Corporation or any of its subsidiaries that, in the sole judgment of the Corporation, acting reasonably, has, have
or may have, individually or in the aggregate, a material adverse effect with respect to the Corporation and its subsidiaries; |
| (f) | any take-over bid or tender or exchange offer with respect to some or all of the securities of the Corporation,
or any merger, plan of arrangement, business combination or acquisition proposal, disposition of assets, or other similar transaction
with or involving the Corporation and its subsidiaries, other than the Offer, or any solicitation of proxies, other than by management,
to seek to control or influence the Board of Directors, shall have been proposed, announced or made by any individual or entity; |
| (g) | Canaccord Genuity has withdrawn or amended the Liquidity Opinion with respect to the liquidity of Shares; |
| (h) | there shall have occurred a decrease in excess of 10% of the market price of Shares on the TSX or Nasdaq
since the close of business on July 25, 2023; |
| (i) | the Corporation shall have concluded, in its sole judgment, acting reasonably, that the Offer or the taking
up and payment for any or all Shares by the Corporation is illegal or not in compliance with applicable law and, if required under any
such legislation, the Corporation shall not have received the necessary exemptions from or approvals or waivers of the appropriate courts
or applicable securities regulatory authorities in respect of the Offer, or such exemptions or waivers are rescinded or modified in a
manner that is not in form and substance satisfactory to the Corporation; |
| (j) | any approval, permit, authorization, favorable review or consent or waiver of or filing with any domestic
or foreign governmental entity or other authority or any third party consent, required to be obtained or made in connection with the Offer,
shall not have been obtained or made on terms and conditions satisfactory to us in our reasonable judgment; |
| (k) | any change shall have occurred or been proposed to the Income Tax Act (Canada) and the regulations
thereunder (collectively, the “Tax Act”) or to the current published administrative policies and assessing practices
of the Canada Revenue Agency (the “CRA”), that, in the sole judgment of the Corporation, is detrimental to the Corporation
or its affiliates taken as a whole or to a Shareholder, or with respect to making the Offer or taking up and paying for Shares deposited
under the Offer; |
| (l) | the Corporation shall have determined, in its sole judgment, acting reasonably, that the completion of
the Offer subjects the Corporation to any material tax liability, other than a liability to withhold and remit taxes in respect of amounts
paid under the Offer, or subjects the Corporation to Part VI.1 tax under the Tax Act; |
| (m) | any change shall have occurred or been proposed to the United States Internal Revenue Code of 1986,
as amended (the “Code”), the Treasury regulations promulgated thereunder, or publicly available administrative policies
of the U.S. Internal Revenue Service (the “IRS”), or the equivalent laws, regulations and policies of another jurisdiction
where one or more Shareholders are resident, that, in the sole judgment of the Corporation, is detrimental to the Corporation or its affiliates
taken as a whole or to a Shareholder, or with respect to making the Offer or taking up and paying for Shares deposited under the Offer; |
| (n) | the Corporation shall have concluded that the purchase of Shares pursuant to the Offer will constitute
a “Rule 13e-3 transaction”, as such term is defined in Rule 13e-3 under the Exchange Act; |
| (o) | any entity, “group” (as that term is used in Section 13(d)(3) of the Exchange Act) or person
(other than entities, groups or persons who have filed with the SEC on or before July 25, 2023 a Schedule 13G with respect to any Shares)
shall have acquired or proposed to acquire, beneficial ownership of more than 5% of the outstanding Shares; |
| (p) | any entity, group, or person who has filed with the SEC on or before July 25, 2023 a Schedule 13G with
respect to any Shares shall have acquired or proposed to acquire, whether through the acquisition of stock, the formation of a group,
the grant of any option or right, or otherwise (other than by virtue of the Offer), beneficial ownership of additional Shares constituting
2% or more of the outstanding Shares; |
| (q) | any entity, person or group shall have filed on or after July 25, 2023 a Notification and Report Form
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended reflecting an intent to acquire us or any Shares, or
has made a public announcement reflecting an intent to acquire the Corporation or any of our subsidiaries or any of our or their respective
assets or securities; or |
| (r) | the Corporation reasonably determines that the completion of the Offer and the purchase of Shares may
cause Shares to be delisted from the TSX. |
The foregoing conditions are for the sole benefit
of the Corporation and may be asserted by the Corporation, in its sole judgment, acting reasonably, regardless of the circumstances giving
rise to any such conditions, or may be waived by the Corporation, in its sole judgment, acting reasonably, in whole or in part at any
time prior to the Expiration Date, provided that any condition waived in whole or in part will be waived with respect to all Shares tendered.
The waiver of any such right with respect to particular facts and other circumstances shall not be deemed a waiver with respect to any
other facts and circumstances. Any determination by the Corporation concerning the events described in this Section shall be final and
binding on all parties, except as otherwise finally determined by a court of competent jurisdiction or as required by law.
Any waiver of a condition or the withdrawal of
the Offer by the Corporation shall be deemed to be effective on the date on which notice of such waiver or withdrawal by the Corporation
is delivered or otherwise communicated to the Depositary. The Corporation, after giving notice to the Depositary of any waiver of a condition
or the withdrawal of the Offer, shall immediately make a public announcement of such waiver or withdrawal and, as applicable, provide
or cause to be provided notice of such waiver or withdrawal to the TSX, Nasdaq and the applicable securities regulatory authorities. If
the Offer is withdrawn, the Corporation shall not be obligated to take up, accept for purchase or pay for any Shares tendered under the
Offer, and the Depositary will return all tendered Shares, Letters of Transmittal and Notices of Guaranteed Delivery and any related documents
to the parties by whom they were deposited.
| 8. | Extension and Variation of the Offer |
Subject to applicable law, the Corporation expressly
reserves the right, in its sole discretion, at any time or from time to time prior to the Expiration Date to the extent permitted under
applicable securities legislation, to extend the period of time during which the Offer is open or to vary the terms and conditions of
the Offer by giving written notice, or oral notice to be confirmed in writing, of extension or variation to the Depositary and by causing
the Depositary to provide to all Shareholders, where required by law, as soon as practicable thereafter, a copy of the notice in the manner
set forth under “Offer to Purchase – Notice”. Promptly after giving notice of an extension or variation to the Depositary,
the Corporation will make a public announcement of the extension or variation (such announcement, in the case of an extension, to be issued
no later than 9:00 a.m. (Eastern time), on the next business day after the last previously scheduled or announced Expiration Date) and,
as applicable, provide or cause to be provided notice of such extension or variation to the TSX, Nasdaq and the applicable securities
regulatory authorities, including the SEC. Any notice of extension or variation will be deemed to have been given and be effective on
the day on which it is delivered or otherwise communicated, by facsimile or electronic mail, to the Depositary at its principal office
in Toronto, Ontario.
Where the terms of the Offer are varied (other
than a variation consisting solely of the waiver of a condition of the Offer), the period during which Shares may be deposited pursuant
to the Offer will not expire before 10 days (except for any variation increasing or decreasing the aggregate Purchase Price or the range
of prices we may pay for Shares pursuant to the Offer, and thereby increasing or decreasing the number of Shares purchasable in the Offer,
or fees payable to the Dealer Managers of the Offer or any soliciting dealer, in which case the Offer will not expire before 10 business
days from the date such variation is published) after the date of the notice of variation, unless otherwise permitted by applicable law.
In the event of any variation, all Shares previously deposited and not taken up or withdrawn will remain subject to the Offer and may
be accepted for purchase by us in accordance with the terms of the Offer, subject to applicable withdrawal rights as specified in “Offer
to Purchase – Withdrawal Rights”. An extension of the Expiration Date or a variation of the Offer does not constitute a waiver
by the Corporation of its rights set forth in “Offer to Purchase – Conditions of the Offer”.
If the Corporation makes a material change in
the terms of the Offer or the information concerning the Offer or if we waive a material condition of the Offer, we will disseminate additional
tender offer materials and extend the Offer if and to the extent required by applicable Canadian securities laws, the rules of the SEC
under the Exchange Act and the interpretations thereunder. Pursuant to applicable United States securities laws, the minimum period during
which an offer must remain open following material changes in the terms of an offer or information concerning an offer, other than a change
in price or a change in percentage of securities sought, will depend upon the facts and circumstances, including the relative materiality
of the terms or information changes and the appropriate manner of dissemination. In a published release, the SEC has stated that, in its
view, an offer should remain open for a minimum of five business days from the date the material change is first published, sent or given
to security holders, and that if material changes are made with respect to information that approaches the significance of price and the
percentage of securities sought, a minimum period of 10 business days may be required to allow for adequate dissemination to security
holders and investor response.
The Corporation expressly reserves the right,
in its sole discretion (i) to terminate the Offer and not take up and pay for any Shares not theretofore taken up and paid for upon the
occurrence of any of the events specified under “Offer to Purchase – Conditions of the Offer”, and (ii) at any time
or from time to time prior to the Expiration Date, to amend the Offer in any respect, including increasing or decreasing the number of
Shares the Corporation may purchase or the range of prices it may pay pursuant to the Offer, subject to compliance with applicable securities
legislation.
Any such extension, delay, termination or amendment
will be followed as promptly as practicable by a public announcement. Without limiting the manner in which the Corporation may choose
to make any public announcement, except as provided by applicable law, the Corporation shall have no obligation to publish, advertise
or otherwise communicate any such public announcement other than by making a release through its usual news wire service.
The Corporation will not provide for any subsequent
offering period following the Expiration Date.
| 9. | Taking Up and Payment for Tendered Shares |
The Corporation will comply with both Canadian
and U.S. regulations governing the timing for acceptance of and payment for Shares. Under Canadian regulations, upon the terms and provisions
of the Offer (including pro-ration) and subject to and in accordance with applicable Canadian and United States securities laws, the Corporation
is required to take up and pay for Shares properly tendered and not withdrawn under the Offer in accordance with the terms thereof promptly
after the Expiration Date, but in any event no later than the latest date required by applicable law, provided that the conditions of
the Offer (as the same may be amended) have been satisfied or waived. The Corporation will acquire Shares to be purchased pursuant to
the Offer and title thereto under this Offer to Purchase upon having taken up such Shares even if payment therefore shall have not been
effected. The Corporation will pay for such Shares within three business days after taking up Shares. Pursuant to Rule 14e-1(c) under
the Exchange Act, the Corporation is required to promptly accept for payment and promptly thereafter pay for all Shares validly tendered
and not properly withdrawn prior to the Expiration Date pursuant to the Offer.
For the purposes of the Offer, the Corporation
will be deemed to have taken up and paid for the Successfully Tendered Shares having an aggregate Purchase Price not exceeding $40,000,000
if, as and when the Corporation gives oral notice (to be confirmed in writing) or written notice or other communication confirmed in writing
to the Depositary to that effect.
The Corporation reserves the right, in its sole
discretion, to delay taking up or paying for any Shares or to terminate the Offer and not take up or pay for any Shares if any event specified
under “Offer to Purchase – Conditions of the Offer” is not satisfied or waived, by giving written notice thereof or
other communication confirmed in writing to the Depositary. The Corporation also reserves the right, in its sole discretion and notwithstanding
any other condition of the Offer, to delay taking up and paying for Shares to the extent required to comply with any applicable law.
In the event of pro-ration of Shares tendered
pursuant to the Offer, the Corporation will determine the pro-ration factor and pay for those tendered Shares accepted for payment promptly
after the Expiration Date. However, the Corporation does not expect to be able to announce the final results of any such pro-ration until
approximately three business days after the Expiration Date.
All tendered Shares not purchased, including all
Shares tendered pursuant to Auction Tenders at prices greater than the Purchase Price, Shares not purchased due to pro-ration and Shares
not accepted for purchase, will be returned to the tendering Shareholder promptly after the Expiration Date or termination of the Offer
without expense to the tendering Shareholder.
The Corporation will pay for Shares taken up under
the Offer by providing the Depositary with sufficient funds (by bank transfer or other means satisfactory to the Depositary) for transmittal
to the tendering Shareholders. Under no circumstances will interest accrue or be paid by the Corporation or the Depositary on the Purchase
Price of Shares purchased by the Corporation, regardless of any delay in making such payment or otherwise.
The tendering Shareholders will not be obligated
to pay brokerage fees or commissions to the Corporation, the Dealer Managers or the Depositary. However, Shareholders are cautioned to
consult with their own brokers or other intermediaries to determine whether any fees or commissions are payable to their brokers or other
intermediaries in connection with a tender of Shares pursuant to the Offer. The Corporation will pay all fees and expenses of the Dealer
Managers (in their capacity as such) and the Depositary in connection with the Offer.
The Depositary will act as agent of persons who
have properly tendered Shares in acceptance of the Offer and have not withdrawn them, for the purposes of receiving payment from the Corporation
and transmitting payment to such persons. Receipt by the Depositary from the Corporation of payment for such Shares will be deemed to
constitute receipt of payment by persons tendering Shares.
The settlement with each Shareholder who has tendered
Shares under the Offer will be effected by the Depositary by forwarding a cheque, payable in U.S. funds, representing the cash payment
(less applicable withholding taxes, if any) for such Shareholder’s Shares taken up under the Offer. The cheque will be issued in
the name of the person signing the Letter of Transmittal or in the name of such other person as specified by the person signing the Letter
of Transmittal by properly completing the appropriate box in such Letter of Transmittal. Unless the tendering Shareholder instructs the
Depositary to hold the cheque for pick-up by checking the appropriate box in the Letter of Transmittal, the cheque will be forwarded by
prepaid mail to the payee at the address specified in the Letter of Transmittal. If no such delivery instructions are specified, the cheque
will be sent to the address of the tendering Shareholder as it appears in the registers maintained in respect of Shares. Cheques mailed
in accordance with this paragraph will be deemed to have been delivered at the time of mailing. Payments will be made net of any applicable
withholding taxes.
All Shares purchased by the Corporation pursuant
to the Offer will be cancelled.
| 10. | Payment in the Event of Mail Service Interruption |
Notwithstanding the provisions of the Offer, cheques
in payment for Shares purchased under the Offer and certificates for any Shares to be returned will not be mailed if the Corporation determines
that delivery by mail may be delayed. Persons entitled to cheques or certificates that are not mailed for this reason may take delivery
at the office of the Depositary at which the tendered certificates for Shares were delivered until the Corporation has determined that
delivery by mail will no longer be delayed. The Corporation will provide notice, in accordance with this Offer to Purchase, of any determination
under this section not to mail as soon as reasonably practicable after such determination is made.
Shares acquired pursuant to the Offer shall be
acquired by the Corporation free and clear of all hypothecs, liens, charges, encumbrances, security interests, claims, restrictions and
equities whatsoever, together with all rights and benefits arising therefrom, provided that any dividends or distributions that may be
paid, issued, distributed, made or transferred on or in respect of such Shares to Shareholders of record on or prior to the date upon
which Shares are taken up and paid for under the Offer shall be for the account of such Shareholders. Each Shareholder of record on that
date will be entitled to receive that dividend or distribution, whether or not such Shareholder tenders Shares pursuant to the Offer.
Each tendering Shareholder will represent and
warrant that such Shareholder has full power and authority to deposit, sell, assign and transfer the deposited Shares and any and all
dividends, distributions, payments, securities, rights, assets or other interests which may be declared, paid, issued, distributed, made
or transferred on or in respect of the deposited Shares with a record date on or after the date that illumin takes up and accepts for
purchase the deposited Shares and that, if the deposited Shares are taken up and accepted for purchase by illumin, illumin will acquire
good title thereto, free and clear of all liens, charges, encumbrances, security interests, claims, restrictions and equities whatsoever,
together with all rights and benefits arising therefrom.
Without limiting any other lawful means of giving
notice, any notice to be given by the Corporation or the Depositary under the Offer will be deemed to have been properly given if it is
broadly disseminated by news release or mailed by first-class mail, postage prepaid, to the registered holders of Shares at their respective
addresses as shown on the share registers maintained in respect of Shares and will be deemed to have been received following the issuance
of such news release or on the first business day following the date of mailing, as applicable. These provisions apply despite (i) any
accidental omission to give notice to any one or more Shareholders, and (ii) an interruption of mail service in Canada or the United States
following mailing. In the event of an interruption of mail service following mailing, the Corporation will use reasonable efforts to disseminate
the notice by other means, such as publication. If any notice is to be given by mail and post offices in Canada or the United States are
not open for deposit of mail, or there is reason to believe there is or could be a disruption in all or any part of the postal service,
any notice which the Corporation or the Depositary may give or cause to be given under the Offer will be deemed to have been properly
given and to have been received by Shareholders if it is issued by way of a news release and if it is published once in the New York
Times, The Globe and Mail or the National Post and in La Presse.
| (a) | No broker, dealer or other person has been authorized to give any information or to make any representation
on behalf of the Corporation, the Board of Directors, the Dealer Managers or the Depositary other than as contained in the Offer, and,
if any such information or representation is given or made, it must not be relied upon as having been authorized by the Corporation, the
Board of Directors, the Dealer Managers or the Depositary. |
| (b) | The Offer and all contracts resulting from the acceptance thereof shall be governed by and construed in
accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. |
| (c) | The Corporation, in its sole discretion, shall be entitled to make a final and binding determination of
all questions relating to the interpretation of the Offer, the validity of any acceptance of the Offer and the validity of any withdrawals
of Shares, except as otherwise finally determined in a subsequent judicial proceeding or as required by law. |
| (d) | The Offer is not being made to Shareholders residing in any jurisdiction in which the making of the Offer
would not be in compliance with the laws of such jurisdiction. The Corporation may, in its sole discretion, take such action as it may
deem necessary to extend the Offer to Shareholders in any such jurisdiction in accordance with applicable laws. |
| (e) | It is a term of the Offer that, for the purposes of subsection 191(4) of the Tax Act, the “specified
amount” in respect of each Share will be an amount equal to the closing trading price for Shares on Nasdaq on the Expiration Date,
as converted into Canadian dollars using the Cdn$/US$ Bank of Canada daily average exchange rate on the Expiration Date. We will publicly
announce the specified amount when we announce the Purchase Price pursuant to the Offer. |
Neither illumin nor its Board of Directors,
in making the decision to present the Offer to Shareholders, makes any recommendation to any Shareholder as to whether to tender or refrain
from tendering Shares. We urge Shareholders to consult their own financial, legal, investment and tax advisors and make their own decision
whether to deposit Shares to the Offer and, if so, how many Shares to deposit, and at what price or prices.
The accompanying Circular, together with this
Offer to Purchase, constitutes the issuer bid circular required under Canadian securities legislation with respect to the Offer. The accompanying
Circular contains additional information relating to the Offer.
Pursuant to Rule 13e-4(c)(2) under the Exchange
Act, illumin has filed with the SEC a Schedule TO which contains additional information with respect to the Offer. The Offer, which constitutes
a part of the Schedule TO, does not contain all of the information set forth in the Schedule TO. The Schedule TO, including any amendments
and supplements thereto, may be examined, and copies may be obtained at the same places and in the same manner as is set forth under “Offer
to Purchase – Additional Information” with respect to information concerning illumin. The Offer is not being made to Shareholders
in any jurisdiction in which the making or acceptance of offers to sell Shares would not be in compliance with the laws of that jurisdiction.
If the Corporation becomes aware of any U.S. state or other jurisdiction where the making of the Offer or the acceptance of Shares pursuant
to the Offer is not in compliance with applicable law, the Corporation will make a good faith effort to comply with the applicable law.
If, after such good faith effort, the Corporation cannot comply with the applicable law, the Offer will not be made to Shareholders residing
in such U.S. state or jurisdiction. In any U.S. state or other jurisdiction where the securities, blue sky or other laws require the Offer
to be made by a licensed broker or dealer, the Offer shall be deemed to be made on our behalf by one or more registered brokers or by
dealers licensed under the laws of that jurisdiction.
DATED this 27 day
of July, 2023.
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ILLUMIN HOLDINGS INC. |
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By: |
(signed) “Tal Hayek” |
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Name: Tal Hayek |
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Title: Chief Executive Officer |
ISSUER
BID CIRCULAR
This Circular is being furnished in connection
with the Offer by illumin to purchase for not more than $40,000,000 up to 15,810,276 of its Shares at a Purchase Price of not less than
$2.53 per Share and not more than $2.65 per Share. Terms defined in the Offer to Purchase and not otherwise defined herein have the same
meaning in this Circular. The terms and conditions of the Offer to Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery
are incorporated into and form part of this Circular. Reference is made to the Offer to Purchase for details of the terms and conditions
of the Offer.
The Corporation is a technology company that enables
marketers to connect intelligently with audiences across video, mobile, social and online advertising campaigns. The Corporation’s
Programmatic Marketing Platform, powered by proprietary machine learning technology, is at the core of its business, accompanied by proprietary
solutions for analytics-led video and mobile targeting that leverages data. The Corporation empowers marketers by offering near real-time
reporting and analytics, bringing accountability to programmatic advertising to deliver business results and help solve the key challenges
that digital advertisers face. The Corporation is headquartered in Toronto and has offices in Canada, the U.S., Spain, France, Brazil,
Chile, Mexico, Colombia and Argentina. Its key customers include both agencies and brands, including large Fortune 500 enterprises and
small to mid-sized businesses.
The Corporation was incorporated under the Canadian
Business Corporations Act. Its executive office is located at 70 University Avenue, Suite 1200, Toronto, Ontario M5J 2M4.
For additional information regarding illumin,
see “Offer to Purchase – Additional Information”.
The Corporation is authorized to issue an unlimited
number of Shares and preferred shares, each issuable in series. As at July 25, 2023, 56,185,631 Shares were outstanding and no preferred
shares were outstanding.
| 3. | Purpose and Effect of the Offer |
We continuously consider ways to enhance Shareholder
value. Following a thoughtful review of the capital required for our operational and strategic investment needs, we have determined that
the Corporation has excess cash that is available to return to Shareholders. We believe that the purchase of Shares under the Offer represents
an attractive investment by the Corporation and an equitable and efficient means to distribute an aggregate of up to $40,000,000 to Shareholders
who elect to tender, while at the same time proportionately increasing the equity interest in the Corporation of Shareholders who do not
elect to tender, and that the Offer is in the best interests of the Corporation and its Shareholders.
The Corporation believes its Shares are undervalued
and that the Offer is an advisable use of the Corporation’s financial resources given its available cash resources and its ongoing
cash requirements. In addition, as the purchase of Shares pursuant to the Offer will reduce the number of outstanding Shares, the Offer,
if completed, will be accretive to any future earnings per Share that the Corporation may record, although there can be no assurance of
such earnings. Shares acquired by the Corporation pursuant to the Offer will be cancelled.
The Corporation has re-evaluated the continued
benefits and costs of its listing on Nasdaq and has concluded that it is appropriate to delist from Nasdaq as soon as practical following
the expiry of the Offer. While this decision to delist from Nasdaq is not conditional on the making or the success of the Offer, the Offer
provides U.S. Shareholders with an opportunity for liquidity at a premium well in advance of such delisting from Nasdaq. The Corporation
expects that its Shares will be eligible for quotation on the OTC Markets following such delisting.
After giving effect to the Offer, illumin believes
that it will continue to have sufficient financial resources and working capital to conduct its ongoing business and operations and the
Offer is not expected to preclude the Corporation from pursuing its foreseeable business opportunities or the future growth of the Corporation’s
business.
| 3.1 | Background to the Offer |
Management of the Corporation believes that the
recent trading price range of Shares is below their intrinsic value and that repurchasing a portion of Shares would be an efficient use
of the Corporation’s resources. The Corporation’s management engaged Canaccord Genuity to provide the Liquidity Opinion and
financial advice in connection with the Offer. There were no discussions with significant shareholders that were not members of management
or of the Board of Directors prior to the announcement of the Offer.
Given that the trading price range of Shares continued
to be below what the Corporation believes is their intrinsic value, management of the Corporation proposed the Offer to the Board of Directors
for the Board of Directors to consider whether to proceed.
After consulting with Canaccord
Genuity, management provided its recommendation to the Board of Directors that the Corporation proceed with the Offer, including with
respect to the Canadian dollar denomination of the Offer, the “Dutch auction” structure of the Offer, the ranges for the minimum
and maximum tender price amounts and the timing of the commencement of the Offer.
The Board of Directors considered the Offer and
whether it would be in the best interests of the Corporation. Furthermore, a special committee of the Board of Directors was not considered
necessary given that no director had, to the knowledge of the Corporation and its directors and officers, after reasonable inquiry, indicated
any present intention as of the date hereof to deposit any Shares pursuant to the Offer. Accordingly, no actual conflict of interest was
present to necessitate the establishment of a special committee.
In evaluating the Offer and determining that it
would be in the best interests of the Corporation, the Board of Directors gave careful consideration to a number of factors, including,
without limitation, the following:
| (a) | the view of the Corporation’s management that the recent trading price of Shares is not fully reflective
of the value of the Corporation’s business and future prospects and that, therefore, the purchase of Shares under the Offer represents
an attractive investment and an equitable and efficient means of providing value to its Shareholders and is in the best interests of the
Corporation and its Shareholders; |
| (b) | the Board’s belief that the Offer is a prudent use of the Corporation’s financial resources
given its business profile, financial results and assets, the current market price of Shares, and its ongoing cash requirements relative
to its existing cash balance, projected financial performance and access to additional capital; |
| (c) | the financial advice of Canaccord Genuity in respect of the Offer; |
| (d) | Canaccord Genuity’s confirmation that it expected to be in a position to deliver the Liquidity Opinion
prior to the commencement of the Offer, subject to the qualifications, assumptions and limitations customary in such opinions and provided
that there was no material change in the liquidity of Shares prior to the commencement of the Offer; |
| (e) | the positive impact that the purchase of Shares having an aggregate Purchase Price not exceeding $40,000,000
would have on the Corporation’s earnings and cash flow calculated on a per Share basis, as well as on the return on equity on Shares; |
| (f) | after giving effect to the Offer, the Corporation will continue to have sufficient financial resources
and working capital to conduct its ongoing business and operations and the Offer is not expected to preclude the Corporation from pursuing
its foreseeable business opportunities or the future growth of the Corporation’s business; |
| (g) | as the Offer is structured as a “Dutch auction”, it provides Shareholders with an opportunity
to realize on all or a portion of their investment in the Corporation, should they desire liquidity, in quantities which might not otherwise
be available in the market and (i) to determine the price at which they are willing to sell their Shares if such Shares are tendered pursuant
to an Auction Tender or (ii) tender their Shares without specifying a price if such Shares are deposited pursuant to a Purchase Price
Tender and, in each case, to sell their Shares without incurring brokerage fees or commissions (subject to any fees or commissions that
non-registered Shareholders may be charged by the nominee holding their Shares on their behalf) which might otherwise be payable on a
sale of their Shares in a transaction on the TSX or Nasdaq; |
| (h) | tendering Shares under the Offer is optional and available to all Shareholders, and, therefore, each Shareholder
is free to accept or reject the Offer; |
| (i) | the Offer is not conditional upon the receipt of financing or any minimum number of Shares being tendered; |
| (j) | Shareholders who do not tender their Shares to the Offer will realize a proportionate increase in their
equity interest in the Corporation to the extent Shares are purchased by the Corporation pursuant to the Offer; |
| (k) | the Purchase Price represents a premium of up to 11.81% and 11.05%, respectively, over the closing price
of Shares on the TSX and Nasdaq on July 25, 2023, being the last full trading day prior to the announcement of the Offer; |
| (l) | Shareholders beneficially owning fewer than 100 Shares and whose Shares are purchased pursuant to the
Offer will avoid any applicable “Odd Lot” discounts that might otherwise be payable on a sale of their Shares in a transaction
on the TSX or Nasdaq; |
| (m) | based on the Liquidity Opinion, it is reasonable to conclude that, following the completion of the Offer
in accordance with its terms, there would be a market for beneficial owners of Shares who do not tender to the Offer that is not materially
less liquid than the market that existed at the time of the making of the Offer; and |
| (n) | following completion of the Offer in accordance with its terms, any change in the profile of the shareholder
base of the Corporation should not have a negative impact on Shareholders. |
The foregoing summary of the factors considered
by the Board of Directors is not, and is not intended to be, exhaustive. In view of the variety of factors and the amount of information
considered in connection with its determination to proceed with the Offer, the Board of Directors did not find it practical to, and did
not, quantify or otherwise attempt to assign any relative weight to each specific factor considered in reaching its conclusion.
The Board of Directors, based on careful consideration
of the above-mentioned reasons, determined that the Offer is in the best interests of the Corporation and authorized and approved on July
26, 2023 the making of the Offer, its final pricing, the Offer, including this Circular and related documents, and the delivery of thereof
to security holders.
None of illumin, its Board of Directors, the
Dealer Managers or the Depositary makes any recommendation to any Shareholder as to whether to tender or refrain from tendering Shares
under the Offer, whether Shareholders should elect an Auction Tender or a Purchase Price Tender, or as to the purchase price or purchase
prices at which Shareholders may tender Shares under the Offer. Shareholders are urged to evaluate carefully all information in the Offer,
consult their own financial, legal, investment and tax advisors and make their own decisions as to whether to tender Shares under the
Offer, and, if so, how many Shares to tender and the price or prices at which to tender. For additional information, see “Issuer
Bid Circular – Income Tax Consequences”.
Canadian securities laws prohibit the Corporation
and its affiliates from acquiring or offering to acquire beneficial ownership of any Shares, other than pursuant to the Offer, until at
least 20 business days after the Expiration Date or termination of the Offer, except, in the case of acquisitions during the period following
the Expiration Date, pursuant to certain acquisitions effected in the normal course on a published market or as otherwise permitted by
applicable law.
Subject to applicable law, the Corporation may
in the future purchase additional Shares on the open market, in private transactions, through issuer bids or otherwise, including a new
normal course issuer bid. Any such purchases may be on the same terms or on terms that are more or less favourable to Shareholders than
the terms of the Offer. Any possible future purchases by the Corporation will depend on many factors, including the market price of Shares,
the Corporation’s business and financial position, the results of the Offer and general economic and market conditions.
Shareholders who do not tender their Shares to
the Offer or whose Shares are not accepted due to the preferential acceptance of odd lots or proration should be aware that while remaining
Shareholders will have a proportionately increased equity interest in the Corporation, the amounts available for future returns of capital
to Shareholders, if any, on a per Share basis may be less than the Purchase Price under the Offer.
As at July 25, 2023, there were 56,185,631 Shares
issued and outstanding, of which 49,533,237 Shares comprise the “public float”, which excludes Shares beneficially owned,
or over which control or direction is exercised, by “related parties” of the Corporation as defined under applicable Canadian
securities laws (which includes our directors and executive officers and any of our subsidiaries as well as any person that beneficially
owns or exercises control or direction over 10% or more of the issued and outstanding Shares). The maximum number of Shares that the Corporation
is offering to purchase pursuant to the Offer, if the Purchase Price is determined to be $2.53 (being the minimum Purchase Price under
the Offer), represents approximately 28.14% of Shares outstanding on that date. If the Corporation purchases such maximum number of Shares,
the “public float” will comprise approximately 33,722,961
Shares.
The Corporation is relying on the “liquid
market exemption” specified in MI 61-101 from the requirement to obtain a formal valuation that would otherwise be applicable to
the Offer.
While not required under applicable securities
laws, the Board of Directors has voluntarily obtained the Liquidity Opinion from Canaccord Genuity to the effect that, as of July 26,
2023, based on and subject to the qualifications, assumptions and limitations stated in the Liquidity Opinion: (a) a liquid market for
Shares exists; and (b) it is reasonable to conclude that, following the completion of the Offer in accordance with its terms, there will
be a market for holders of Shares who do not tender to the Offer that is not materially less liquid than the market that existed at the
time of the making of the Offer. Accordingly, the Corporation is exempted from the valuation requirements of the securities regulatory
authorities in Canada applicable to issuer bids generally in connection with the Offer.
The full text of the Liquidity Opinion, setting
out the assumptions made, matters considered and limitations and qualifications on the review undertaken by Canaccord Genuity in connection
with the Liquidity Opinion, is attached as Schedule A. The summary of the Liquidity Opinion in the Offer to Purchase and this Circular
is qualified in its entirety by reference to the full text of the Liquidity Opinion. The Liquidity Opinion is not a recommendation to
any Shareholder as to whether to tender or refrain from tendering Shares. Shareholders should read the Liquidity Opinion attached hereto
at Schedule A in its entirety. The Liquidity Opinion was provided to the Board of Directors for its exclusive use only in determining
the availability of an exemption from the formal valuation requirements of MI 61-101 in connection with the Offer and may not be used
or relied upon by any other person or for any other purpose. As financial advisor to the Corporation and dealer manager for the Offer
in Canada, Canaccord Genuity is not independent of the Corporation for purposes of MI 61-101.
| 3.3 | Additional Securities Law Considerations |
The Corporation is a reporting issuer (or the
equivalent thereof) in all provinces and territories of Canada, and Shares are listed on the TSX and Nasdaq. The Corporation believes
that the purchase of Shares pursuant to the Offer will not result in: (i) illumin ceasing to be a reporting issuer in any province or
territory of Canada or (ii) Shares being delisted from the TSX or Nasdaq.
Shares are also registered under Section 12(b)
of the Exchange Act. The Corporation believes that the purchase of Shares pursuant to the Offer will not result in Shares becoming eligible
for deregistration under the Exchange Act.
Shares are currently “margin securities”
under the rules of the U.S. Federal Reserve Board. This has the effect, among other things, of allowing brokers to extend credit on the
collateral of Shares. The Corporation believes that, following the repurchase of Shares pursuant to the Offer, Shares will continue to
be margin securities for the purposes of the U.S. Federal Reserve Board’s margin regulations.
The withdrawal rights of Shareholders are described
under “Offer to Purchase – Withdrawal Rights” and are incorporated into and form part of this Circular.
| 5. | Price Range and Trading Volume of Shares |
The outstanding Shares are traded on the TSX under
the trading symbol ‘ILLM. The following tables set forth the price range and trading volume of Shares as reported by the TSX for
the periods indicated below. The weighted average trading price of the Shares for the ten trading days ending July 25, 2023 was $2.41
per Share on the TSX.
| Month (2022 – 2023) | |
High Price
($) | |
Low Price
($) | |
Volume
(In 000’s) |
| December | |
$ | 2.72 | | |
$ | 1.93 | | |
| 3,473 | |
| January | |
$ | 2.47 | | |
$ | 2.10 | | |
| 2,969 | |
| February | |
$ | 2.63 | | |
$ | 2.07 | | |
| 2,448 | |
| March | |
$ | 2.55 | | |
$ | 1.92 | | |
| 4,711 | |
| April | |
$ | 2.27 | | |
$ | 1.94 | | |
| 1,871 | |
| May | |
$ | 2.44 | | |
$ | 1.84 | | |
| 1,498 | |
| June | |
$ | 2.44 | | |
$ | 2.08 | | |
| 1,073 | |
| July 1 to July 25 | |
$ | 2.55 | | |
$ | 2.10 | | |
| 861 | |
| Quarter | |
High Price
($) | |
Low Price
($) |
| Three Months ended December 31, 2022 | |
$ | 2.72 | | |
$ | 1.86 | |
| Three Months ended March 31, 2023 | |
$ | 2.63 | | |
$ | 1.92 | |
The outstanding Shares are also traded on Nasdaq
under the trading symbol ‘ILLM. The following table sets forth the price range and trading volume of Shares as reported by Nasdaq
for the six-month period preceding the date hereof. The weighted average trading price of the Shares for the ten trading days ending July
25, 2023 was US$1.81 per Share on Nasdaq.
| Month (2021 – 2022) | |
High Price
(US$) | |
Low Price
(US$) | |
Volume
(In 000’s) |
| December | |
$ | 2.00 | | |
$ | 1.42 | | |
| 1,260 | |
| January | |
$ | 1.84 | | |
$ | 1.55 | | |
| 1,191 | |
| February | |
$ | 1.97 | | |
$ | 1.52 | | |
| 910 | |
| March | |
$ | 1.85 | | |
$ | 1.45 | | |
| 1,493 | |
| April | |
$ | 1.67 | | |
$ | 1.43 | | |
| 755 | |
| May | |
$ | 1.80 | | |
$ | 1.38 | | |
| 1,246 | |
| June | |
$ | 1.84 | | |
$ | 1.57 | | |
| 867 | |
| July 1 to July 25 | |
$ | 1.91 | | |
$ | 1.62 | | |
| 597 | |
| Quarter | |
High Price
(US$) | |
Low Price
(US$) |
| Three Months ended December 31, 2022 | |
$ | 2.00 | | |
$ | 1.38 | |
| Three Months ended March 31, 2023 | |
$ | 1.97 | | |
$ | 1.45 | |
On July 25, 2023, the date prior to the announcement
of the Corporation’s intention to proceed with a substantial issuer bid, the closing price on the TSX was $2.37 per Share and on
Nasdaq was US$1.81 per Share. Shareholders are urged to obtain current market quotations for Shares.
The Corporation is not currently paying any dividends
on Shares and it is not expected that illumin will declare any dividends for the foreseeable future. The Corporation may, in its discretion,
retain any earnings to finance the operation and expansion of its business, and accordingly, may not pay any dividends in the future.
| 7. | Previous Distributions and Purchases of Securities |
| 7.1 | Previous Purchases and Sales of Securities |
The Corporation received approval from the TSX
on May 16, 2022 to commence a normal course issuer bid for up to 5,500,000 Shares during the 12-month period commencing on May 16, 2022
and ending May 15, 2023. Between May 16, 2022 and May 15, 2023, illumin purchased 5,404,894 Shares, at an average price of $2.96 per Share.
Shares were purchased on behalf of the Corporation by a registered broker through the facilities of the TSX and through other alternative
Canadian trading platforms at the prevailing market price at the time of such transaction.
Except as described under “Issuer Bid Circular
– Previous Distributions of Securities” below, no securities of the Corporation have been issued by the Corporation during
the twelve months proceeding the date of the Offer.
| 7.2 | Previous Distributions of Securities |
Previous Offerings
On May 22, 2019, illumin completed a short form
prospectus bought deal offering of 5,936,300 Shares at a price of $1.55 per Share for aggregate gross proceeds to the Corporation of $9,201,265,
which included the full exercise by the underwriters of the over-allotment option.
On December 4, 2020, illumin and certain of its
Shareholders completed a short form prospectus bought deal offering comprised of 1,968,000 Shares issued from treasury and offered by
the Corporation for gross proceeds to the Corporation of approximately $12 million and 1,804,000 Shares offered by certain Shareholders,
namely 2794606 Ontario Ltd. and OV2 Capital Inc., for gross proceeds to those selling shareholders of approximately $11 million.
On June 14, 2021, illumin completed a public offering
of 5,665,025 Shares in the United States and Canada, including the exercise in full by the underwriters of their over-allotment option,
at a price of US$10.15 ($12.25) per Share, for gross proceeds to the Corporation of US$57,500,003 ($69,396,556). In connection with this
public offering, on June 21, 2021, Shares were listed and began trading on Nasdaq.
Omnibus Incentive Plan, Option Plan and
DSU Plan
In the five years preceding the date of the Offer,
5,468,762 Shares have been issued by the Corporation upon the exercise
of rights to purchase or otherwise acquire Shares which were granted in connection with the Corporation’s omnibus long-term incentive
plan (the “Omnibus Incentive Plan”) the existing amended and restated stock option plan first approved by Shareholders
on June 14, 2016 (the “Option Plan”), and the legacy third amended and restated deferred share unit plan first
approved by Shareholders on June 14, 2016 (the “DSU Plan”) of the Corporation.
The table below indicates the numbers of Shares
that were issued by the Corporation on an annual basis since the inception of the Omnibus Incentive Plan on April 13, 2020 upon the exercise
of Options to purchase Shares and upon the conversion of restricted share units (“RSUs”), performance share units (“PSUs”)
and deferred share units (“DSUs”) to Shares pursuant to the Corporation’s Omnibus Incentive Plan, the Option
Plan and the DSU Plan, as applicable:
| Year of Distribution |
Number of Shares Issued on Exercise |
Average Exercise Price per Share |
Aggregate Proceeds |
| |
|
|
|
| Options (under the Option Plan) |
| January 1, 2018 to December 31, 2018 |
254,570 |
$0.81 |
$205,826 |
| January 1, 2019 to December 31, 2019 |
240,167 |
$0.96 |
$230,872 |
| January 1, 2020 to December 31, 2020 |
1,133,482 |
$1.29 |
$1,465,658 |
| January 1, 2021 to December 31, 2021 |
745,517 |
$1.41 |
$1,054,673 |
| January 1, 2022 to December 31, 2022 |
247,866 |
$1.51 |
$374,037 |
| January 1, 2023 to July 25, 2023 |
Nil |
Nil |
Nil |
| |
|
|
|
| Options (under the Omnibus Incentive Plan) |
| April 13, 2020 to December 31, 2020 |
Nil |
Nil |
Nil |
| January 1, 2021 to December 31, 2021 |
11,666 |
$2.09 |
$24,382 |
| January 1, 2022 to December 31, 2022 |
Nil |
Nil |
Nil |
| January 1, 2023 to July 25, 2023 |
Nil |
Nil |
Nil |
| |
|
|
|
| DSUs (under the DSU Plan) |
| January 1, 2018 to December 31, 2018 |
157,323 |
$0.00 |
Nil |
| January 1, 2019 to December 31, 2019 |
140,858 |
$0.00 |
Nil |
| January 1, 2020 to December 31, 2020 |
981,578 |
$0.00 |
Nil |
| January 1, 2021 to December 31, 2021 |
540,175 |
$0.00 |
Nil |
| January 1, 2022 to December 31, 2022 |
172,209 |
$0.00 |
Nil |
| January 1, 2023 to July 25, 2023 |
31,666 |
$0.00 |
Nil |
| |
|
|
|
| RSUs, PSUs, and DSUs (under the Omnibus Incentive Plan) |
| April 13, 2020 to December 31, 2020 |
97,129 |
$0.00 |
Nil |
| January 1, 2021 to December 31, 2021 |
309,575 |
$0.00 |
Nil |
| January 1, 2022 to December 31, 2022 |
358,823 |
$0.00 |
Nil |
| January 1, 2023 to July 25, 2023 |
46,158 |
$0.00 |
Nil |
| 8. | Interest of Directors and Executive Officers; Transactions and Arrangements Concerning Shares |
| 8.1 | Interests of Directors and Executive Officers |
Except as set forth in the Offer, neither the
Corporation nor, to the Corporation’s knowledge, any of its directors or executive officers is a party to any agreement, commitment
or understanding, formal or informal, with any securityholder relating, directly or indirectly, to the Offer or with any other person
or company with respect to any securities of the Corporation in relation to the Offer, nor are there any contracts or arrangements made
or proposed to be made between the Corporation and any of its directors or executive officers and no payments or other benefits are proposed
to be made or given by way of compensation for loss of office or as to such directors or executive officers remaining in or retiring from
office if the Offer is successful.
Except as disclosed herein, neither the Corporation
nor, to the Corporation’s knowledge, any of its directors or executive officers has current plans or proposals which relate to,
or would result in, any extraordinary corporate transaction involving the Corporation, such as: a “going private transaction”;
merger; reorganization; liquidation; the sale or transfer of a material amount of its assets or the assets of any of its subsidiaries
(although the Corporation may from time to time consider various acquisition or divestiture opportunities); the purchase of a material
amount of assets; any change in its present Board of Directors or management; any material change in its indebtedness, dividend policy
or capitalization; any other material change in its business or corporate structure; any material change in its articles or by-laws; or
other actions that could impede the acquisition of control of the Corporation, cause any class of equity securities of the Corporation
to be delisted from the TSX or Nasdaq, cause any class of equity securities of the Corporation to become eligible for termination of registration
under the Exchange Act, result in the acquisition by any person of additional securities of the Corporation or the disposition of securities
of the Corporation, or any actions similar to any of the foregoing.
| 8.2 | Ownership of Securities of the Corporation |
To the knowledge of the Corporation, after reasonable
inquiry, the following table indicates, as at July 25, 2023, the number of securities of the Corporation beneficially owned or over which
control or direction is exercised, by each director and executive officer of the Corporation and, to the extent known by the Corporation
after reasonable inquiry, by (a) each associate or affiliate of an insider of the Corporation, (b) each associate or affiliate of the
Corporation, (c) each other insider, as defined in applicable law, of the Corporation, and (d) each person acting jointly or in concert
with the Corporation, and the percentage such number of securities represents of the applicable total outstanding number of such securities.
| |
|
Shares |
|
DSUs |
|
RSUs |
|
Options |
| Name(1) |
Relationship with illumin |
No. of Shares |
% of Outstanding Shares |
|
No. of DSUs |
% of Outstanding DSUs |
|
No. of RSUs |
% of Outstanding RSUs |
|
No. of Options |
% of Outstanding Options |
| Directors |
|
|
|
|
|
|
|
|
|
|
|
|
| Tal Hayek |
Director, Co-Founder, and Chief Executive Officer |
2,401,599 |
4.27 |
|
- |
- |
|
581,281 |
9.92 |
|
125,000 |
17.62 |
| Sheldon Pollack |
Director |
1,969,452 |
3.51 |
|
16,575 |
4.68 |
|
- |
- |
|
80,000 |
11.28 |
| Roger Dent |
Director |
80,000 |
0.14 |
|
73,566 |
20.79 |
|
2,500 |
0.04 |
|
- |
- |
| Igal Mayer |
Director |
96,837 |
0.17 |
|
73,566 |
20.79 |
|
2,500 |
0.04 |
|
70,000 |
9.87 |
| Yishay Waxman |
Director |
50,000 |
0.09 |
|
13,812 |
3.90 |
|
2,273 |
0.04 |
|
30,000 |
4.23 |
| Michele Tobin |
Director |
0 |
0 |
|
32,258 |
9.11 |
|
- |
- |
|
- |
- |
| Paul Khawaja |
Director |
0 |
0 |
|
24,038 |
6.79 |
|
- |
- |
|
- |
- |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Officers |
|
|
|
|
|
|
|
|
|
|
|
|
| Elliot Muchnik |
Chief Financial Officer |
23,330 |
0.04 |
|
- |
- |
|
282,809 |
4.82 |
|
- |
- |
| Rachel Kapcan |
Co-Founder and Chief Product Officer |
1,985,355 |
3.53 |
|
- |
- |
|
573,914 |
9.79 |
|
- |
- |
| Oren Hisherik |
Chief Information and Technology Officer |
45,821 |
0.08 |
|
24,358 |
6.88 |
|
320,775 |
5.47 |
|
50,000 |
7.05 |
| Neil Phasey |
Chief Operating Officer |
0 |
0 |
|
- |
- |
|
94,697 |
1.62 |
|
- |
- |
| |
|
|
|
|
|
|
|
|
|
|
|
|
(1) The business
address of each director, officer, and senior management above is Suite 1200, 70 University Avenue, Toronto, Ontario M5J 2M4.
As of July 25, 2023, all directors and executive
officers of the Corporation as a group beneficially owned or exercised control or direction over an aggregate of 6,652,394 Shares representing
approximately 11.84% of Shares outstanding.
To the knowledge of the directors and executive
officers of the Corporation, as of July 25, 2023, no person or company beneficially owns, directly or indirectly, or exercises control
or direction over, voting securities of the Corporation carrying 10% or more of the voting rights attached to any class of voting securities
of the Corporation.
| 8.3 | Recent Securities Transactions |
Based on our records and on information provided
to us by our directors, executive officers, affiliates and subsidiaries, neither we nor any of our directors, our executive officers,
or our affiliates or our subsidiaries nor, to the best of our knowledge, any person controlling the Corporation or any executive officer
or director of any such controlling entity or of our subsidiaries, has effected any transactions involving Shares during the 60 days prior
to the date hereof.
| 8.4 | Arrangements Concerning Shares |
Acceptance of the Offer
To the knowledge of the Corporation and to the
knowledge of its directors and executive officers, after reasonable inquiry, none of its directors or executive officers, nor any associate
or affiliate of its directors or executive officers, none of the Corporation’s associates or affiliates, nor any of the Corporation’s
other insiders as defined in applicable law and no person or company acting jointly or in concert with the Corporation, will tender any
of such person’s Shares pursuant to the Offer. Those persons listed above who do not tender their Shares pursuant to the Offer will
realize a proportionate increase in their interest in the Corporation to the extent that Shares are purchased by us pursuant to the Offer.
Effect of the Offer on Voting Interests
Shareholders who do not deposit their Shares under
the Offer will realize a proportionate increase in their equity interest in illumin to the extent that Shares are purchased by illumin
pursuant to the Offer.
Commitments to Acquire Shares
The Corporation has no agreements, commitments
or understandings to purchase Shares or other securities of the Corporation, other than pursuant to the Offer, and securities issued,
purchased or sold pursuant to the exercise of employee stock options, in connection with the Omnibus Incentive Plan or in connection with
the Corporation’s other security-based compensation arrangements, and as otherwise described in this Offer to Purchase and this
Circular.
Applicable Canadian securities laws generally
prohibit the Corporation and persons or companies acting jointly or in concert with the Corporation from acquiring or offering to acquire
beneficial ownership of any Shares, other than pursuant to the Offer, from the period commencing on the date of announcement of the Corporation’s
intention to make the Offer until the Expiration Time. In addition, the Corporation and persons or companies acting jointly or in concert
with the Corporation are prohibited from acquiring or offering to acquire beneficial ownership of any Shares during the period commencing
with the Expiration Time and ending on the 20th business day thereafter, except that, in the case of acquisitions during the
period following the Expiration Time, pursuant to certain acquisitions effected in the normal course on a published market or as otherwise
permitted by applicable law.
Accordingly, illumin has not purchased and will
not purchase Shares since the time the Offer was publicly announced until its expiration. illumin may in the future, subject to applicable
law, purchase additional Shares on the open market, in private transactions, through normal course issuer bids, other issuer bids or otherwise.
Any such purchases may be on the same terms or on terms which are more or less favorable to Shareholders than the terms of the Offer.
Any possible future purchases by the Corporation will depend on many factors, including the market price of Shares, the Corporation’s
business and financial position, the results of the Offer and general economic and market conditions.
To the knowledge of the Corporation, after reasonable
inquiry, no person or company referred to in this Circular under “Issuer Bid Circular – Interest of Directors and Officers;
Transactions and Arrangements Concerning Shares” has any agreement, commitment or understanding to acquire securities of the Corporation
other than pursuant to the Corporation’s security-based compensation arrangements. A description of the Omnibus Incentive Plan,
the Option Plan and the DSU Plan is below.
Omnibus
Incentive Plan, Option Plan and DSU Plan
The Corporation offers long-term incentives to
its officers, directors, employees and consultants and non-employee directors pursuant to the Omnibus Incentive Plan, the Option Plan,
and the DSU Plan. As of July 25, 2023, there are a total of 709,470 Options, 6,215,818 RSUs and DSUs issued and outstanding, including
20,001 Options and 5,861,908 RSUs and DSUs awarded under the Omnibus Incentive Plan, and 689,469 Options and 353,910 DSUs issued under
the predecessor Option Plan and DSU Plan, respectively.
Omnibus Incentive Plan. The Omnibus Incentive
Plan was approved by the Board of Directors effective April 13, 2020, and received shareholder ratification on June 16, 2020. The maximum
number of Shares reserved for issuance, in the aggregate, under the Omnibus Incentive Plan, the Option Plan, the DSU Plan and any other
security-based compensation arrangement, collectively, is 15% of the aggregate number of Shares issued and outstanding from time to time.
The Omnibus Incentive Plan allows for a variety of equity-based awards that provide different types of incentives to be granted to certain
officers, directors, employees and consultants (in the case of Options, RSUs and PSUs) and non-employee directors (in the case of DSUs)
pursuant to the discretion of the Plan Administrator (as defined in the Omnibus Incentive Plan).
Unless the Plan Administrator decides otherwise,
the participant’s grant agreement will provide that any Options granted will vest over a 3-year period as follows: 1/3 at the first
anniversary of the date of such grant and 1/3 each subsequent anniversary for the remaining two years following the first anniversary
of the date of such grant. Otherwise, Options granted under the Omnibus Incentive Plan vest in accordance with the terms of the applicable
grant agreement. An Option shall be exercisable during a period established by the Plan Administrator which shall commence on the date
of the grant and shall terminate no later than ten years after the date of the granting of the Option or such shorter period as the Plan
Administrator may determine. The minimum exercise price of an Option will be determined based on the closing price of Shares on the TSX
on the last trading day before the date such Option is granted.
Certain events, including termination for cause,
resignation, retirement, termination other than for cause, and death or long-term disability may impact the rights of holders of Options.
Such events and related impact are set forth in the Omnibus Incentive Plan, and are subject to the terms of a participant’s employment
agreement, grant agreement, and the certain change of control provisions.
The terms and conditions of grants of RSUs, PSUs
and DSUs (including the quantity, type of award, grant date, vesting conditions, vesting periods, settlement, settlement date and other
terms and conditions with respect to these awards) as well as the impact of certain prescribed events on the respective holder, are set
out in the participant’s grant agreement.
Option Plan. Since the adoption of the
Omnibus Incentive Plan, no further awards have been or will be granted under the Option Plan. However, Options that were issued prior
to April 13, 2020 under the Option Plan remain outstanding and are governed by the terms of the Option Plan.
The Options that remain outstanding under the
Option Plan are non-assignable and were granted for a term of five years from the date of grant, and are subject to the terms of a participant’s
employment agreement, grant agreement, and the certain change of control provisions. Options issued under the Option Plan vest at the
discretion of the Board of Directors, subject to the rules or policies of the TSX and certain specified limitations.
DSU Plan. Since the adoption of the Omnibus
Incentive Plan, no further awards have been or will be granted under the DSU Plan. However, DSUs that were issued prior to April 13, 2020
under the DSU Plan remain outstanding and are governed by the terms of the DSU Plan.
Subject to applicable income tax and other withholdings
as required by law, the value of the vested DSUs redeemed by or in respect of a Participant (as defined in the DSU Plan) will be paid
to the Participant, at the election of the Participant, in the form of Shares. Any vesting conditions (which may include time restrictions,
performance conditions or a combination of both) for DSUs was determined by the Compensation and Corporate Governance Committee in advance
of any grants. The Board of Directors may also, in its sole and absolute discretion, accelerate and/or waive any vesting or other conditions
for all or any DSUs for any Participant at any time and from time to time.
The value of each DSU awarded by the Corporation
is equal to the Market Price (as defined in the DSU Plan) of Shares at the time the DSU is awarded. The value of the DSU increases or
decreases as the price of Shares increases or decreases. DSUs generally vest upon redemption, subject to the discretion of the Board,
and are credited to a Participant’s DSU Account (as defined in the DSU Plan).
Benefits from the Offer
No person or company named under “Issuer
Bid Circular – Interest of Directors and Officers; Transactions and Arrangements Concerning Shares” will receive any direct
or indirect benefit from accepting or refusing to accept the Offer other than the Purchase Price for any Shares tendered to the Offer
and purchased by the Corporation in accordance with the terms of the Offer and any benefit available to any Shareholder who does or does
not participate in the Offer.
Contracts, Arrangements or Understandings
with Shareholders
Except as described or referred to in the Offer,
there are no contracts, arrangements or understandings, formal or informal, made or proposed to be made between the Corporation and any
holder of any securities of the Corporation in relation to the Offer.
| 9. | Material Changes in the Affairs of the Corporation |
Except as described or referred to herein, the
directors and executive officers of the Corporation are not currently aware of any plans or proposals for material changes in the affairs
of the Corporation, or of any undisclosed material changes that have occurred since May 11, 2023, which is the date of the Corporation’s
most recent interim financial statements accessible through SEDAR+ and EDGAR, other than the information disclosed in the Corporation’s
material change report dated July 26, 2023.
| 10. | Valuation and Bona Fide Prior Offers |
The Corporation is relying on the “liquid
market exemption” specified in MI 61-101. Accordingly, the valuation requirements of securities regulatory authorities in Canada
applicable to issuer bids generally are not applicable in connection with the Offer.
To the Corporation’s knowledge, or the knowledge
of any of its directors or executive officers, after reasonable inquiry, no prior valuation (as such term is defined in MI 61-101) regarding
illumin, its securities or material assets has been made in the 24 months before the date of the Offer.
There were no bona fide prior offers that
relate to Shares or are otherwise relevant to the Offer received by the Corporation during the 24 months before the date of the Offer.
| 11. | Accounting Treatment of the Offer |
The accounting treatment for the Corporation’s
purchase of Shares in the Offer will result in a reduction in the Corporation’s share capital by an amount equal to the number of
Shares purchased pursuant to the Offer multiplied by the average carrying amount of Shares, with any excess allocated to retained earnings.
| 12. | Income Tax Consequences |
| 12.1 | Certain Canadian Federal Income Tax Considerations |
General
The following general summary describes, as of
the date hereof, certain material Canadian federal income tax considerations under the Tax Act generally applicable to a beneficial owner
of Shares that properly tenders and sells Shares to illumin pursuant to the Offer.
This summary is based on the current provisions
of the Tax Act, all specific proposals to amend the Tax Act publicly announced by or on behalf of the Minister of Finance (Canada) prior
to the date hereof (the “Tax Proposals”) and counsel’s understanding of the current administrative policies and
assessing practices of the CRA which have been published in writing prior to the date hereof. The summary assumes that all of the Tax
Proposals will be implemented in the form proposed, although no assurance in this regard can be given. This summary does not otherwise
take into account or anticipate any changes in law or administrative policies and assessing practices, whether by legislative, regulatory,
administrative or judicial decision or action, nor does it take into account provincial, territorial or foreign tax considerations, which
may differ significantly from those discussed herein.
This summary is not applicable to a Shareholder
(i) that is a “financial institution” for the purposes of the “mark-to-market” rules, (ii) that is a “specified
financial institution”, (iii) that reports its “Canadian tax results” in a currency other than Canadian dollars, (iv)
an interest in which is a “tax shelter investment”, or (v) that has entered into a “derivative forward agreement”
or a “dividend rental arrangement” in respect of Shares, as each of those terms is defined in the Tax Act. This summary is
also not applicable to a Shareholder that acquired Shares pursuant to the exercise of an employee stock option or otherwise in connection
with his or her employment and who disposes of such Shares pursuant to the Offer. All of the foregoing Shareholders should consult their
own tax advisors regarding their particular circumstances.
This summary is not exhaustive of all Canadian
federal income tax considerations. Further, this summary is of a general nature only and is not intended to be, nor should it be considered
to be, legal or tax advice to any particular Shareholder and no representation is made with respect to the income tax consequences to
any particular Shareholder. Accordingly, Shareholders should consult their own tax advisors concerning the application and effect of the
income and other taxes of any country, province, territory, state or local tax authority, having regard to their particular circumstances.
THE DEEMED DIVIDEND TAX TREATMENT DESCRIBED
BELOW ON THE SALE OF SHARES PURSUANT TO THE OFFER DIFFERS FROM THE CAPITAL GAIN (OR CAPITAL LOSS) TREATMENT WHICH WOULD GENERALLY APPLY
TO A SALE OF SHARES IN THE MARKET. ACCORDINGLY, SHAREHOLDERS WHO WISH TO SELL THEIR SHARES AND WHO ARE NOT GENERALLY EXEMPT FROM CANADIAN
FEDERAL INCOME TAX SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING SELLING THEIR SHARES IN THE MARKET AS AN ALTERNATIVE TO SELLING SHARES
PURSUANT TO THE OFFER.
Canadian Currency
Generally, for purposes of the Tax Act, all amounts
relating to the acquisition, holding or disposition or deemed disposition of a Share must be expressed in Canadian dollars. Amounts denominated
in another currency must be converted into Canadian dollars using the applicable rate of exchange (for purposes of the Tax Act) quoted
by the Bank of Canada on the date such amounts arose, or such other rate of exchange as is acceptable to the CRA.
Shareholders Resident in Canada
The following portion of the summary is, subject
to the discussion under “General” above, applicable to a Shareholder who, for purposes of the Tax Act and at all relevant
times, (i) is, or is deemed to be, a resident of Canada, (ii) deals at arm’s length with, and is not affiliated with, illumin, (iii)
holds its Shares as capital property and (iv) is not exempt from tax under Part I of the Tax Act (a “Canadian Holder”).
Shares will generally be considered to be capital property to a Canadian Holder provided that the Canadian Holder does not hold Shares
in the course of carrying on a business of buying and selling Shares and has not acquired Shares in a transaction considered to be an
adventure or concern in the nature of trade. Certain Canadian Holders that might not otherwise be considered to hold their Shares as capital
property may, in certain circumstances, be entitled to make the irrevocable election permitted by subsection 39(4) of the Tax Act to have
Shares and every other “Canadian security” (as defined in the Tax Act) owned by such Canadian Holders in the taxation year
of the election and all subsequent taxation years deemed to be capital property. Such Canadian Holders should consult their own tax advisors
for advice with respect to whether an election under subsection 39(4) of the Tax Act is available or advisable having regard to their
particular circumstances.
Disposition of Shares and Deemed Dividend
A Canadian Holder who sells Shares to illumin
pursuant to the Offer will be deemed to receive a taxable dividend equal to the excess, if any, of the amount paid by illumin for Shares
over the paid-up capital of such Shares for purposes of the Tax Act. The Corporation estimates that the paid-up capital per Share as of
the date hereof is approximately $2.30 (and, following the Expiration Date, illumin will advise Shareholders of any material change to
this estimate). The exact quantum of the deemed dividend, if any, cannot be guaranteed.
Any dividend deemed to be received by a Canadian
Holder who is an individual (including certain trusts) will be subject to the gross-up and dividend tax credit rules normally applicable
to taxable dividends received by Canadian resident individuals from a taxable Canadian corporation, including the enhanced gross-up and
dividend tax credit if illumin validly designates the dividend as an “eligible dividend”. There may be limitations on the
ability of a corporation to designate dividends as eligible dividends. Subject to such limitations, illumin intends to designate all such
deemed dividends arising as a result of a sale of Shares pursuant to the Offer as eligible dividends for these purposes.
Subject to the application of subsection 55(2)
of the Tax Act, as described below, any dividend deemed to be received by a Canadian Holder that is a corporation will be included in
computing such Canadian Holder’s income as a dividend, and will ordinarily be deductible in computing its taxable income subject
also to all other limitations under the Tax Act. To the extent that such a deduction is available, private corporations (as defined in
the Tax Act) and certain other corporations may be liable to pay refundable tax under Part IV of the Tax Act.
Under subsection 55(2) of the Tax Act, a Canadian
Holder that is a corporation may be required to treat all or a portion of any deemed dividend that is deductible in computing its taxable
income as proceeds of disposition and not as a dividend, generally in circumstances where: (i) the Canadian Holder would have realized
a capital gain had it disposed of any Share at fair market value immediately before the sale of Shares to illumin pursuant to the Offer;
(ii) the sale to illumin resulted in a significant reduction in such capital gain; and (iii) the amount of the deemed dividend exceeds
the “safe income” in respect of the particular Share that could reasonably be considered to contribute to such capital gain
(as determined for purposes of the Tax Act). The application of subsection 55(2) involves a number of factual considerations that will
differ for each corporate Canadian Holder, and a Canadian Holder to which it may be relevant is urged to consult its own tax advisors
concerning its application having regard to its particular circumstances.
The amount paid by illumin pursuant to the Offer
for Shares less any amount deemed to be received by the Canadian Holder as a dividend (after the application of subsection 55(2) in the
case of a corporate Canadian Holder) will be treated as proceeds of disposition of Shares. The Canadian Holder will realize a capital
gain (or capital loss) on the disposition of Shares equal to the amount by which the Canadian Holder’s proceeds of disposition,
net of any costs of disposition, exceed (or are less than) the adjusted cost base to the Canadian Holder of Shares sold to illumin pursuant
to the Offer.
Taxation of Capital Gains and Losses
Generally, a Canadian Holder will be required
to include in computing its income for a taxation year one-half of any capital gain (a “taxable capital gain”) realized
by it in that year. Subject to and in accordance with the provisions of the Tax Act, a Canadian Holder must deduct one-half of the amount
of any capital loss (an “allowable capital loss”) realized in a taxation year from taxable capital gains realized by
the Canadian Holder in that year, and any excess may be carried back to any of the three preceding taxation years or carried forward to
any subsequent taxation year and deducted against net taxable capital gains realized in such years.
The amount of a capital loss realized on the disposition
of Shares by a Canadian Holder that is a corporation may, to the extent and under the circumstances specified in the Tax Act, be reduced
by the amount of dividends received or deemed to be received on Shares (including any dividends deemed to be received as a result of the
sale of Shares to illumin pursuant to the Offer). Similar rules may apply where Shares are owned by a partnership or trust of which a
corporation, trust or partnership is a member or beneficiary. Canadian Holders who may be affected by these rules are urged to consult
with their own tax advisors in this regard.
Special rules may apply to suspend or deny, as
applicable, any capital loss realized by a Canadian Holder on the disposition of Shares pursuant to the Offer if the Canadian Holder (or
a person affiliated with the Canadian Holder for purposes of the Tax Act) acquires additional Shares in the period commencing 30 days
prior to, and ending 30 days after, the disposition, and such acquired Shares are owned by such Canadian Holder (or a person affiliated
with the Canadian Holder for purposes of the Tax Act) at the end of such period. Canadian Holders who may be affected by these rules are
urged to consult their own tax advisors.
A Canadian Holder that is a “Canadian-controlled
private corporation” (as defined in the Tax Act) throughout the year may be liable to pay an additional tax (refundable in certain
circumstances) on its “aggregate investment income” for the year, which is defined to include an amount in respect of taxable
capital gains (but not dividends, or deemed dividends, that are deductible in computing taxable income). Tax Proposals announced by the
Minister of Finance (Canada) on April 7, 2022, propose to extend this additional tax to “substantive CCPCs”, as defined in
the Tax Proposals. Canadian Holders who may be affected by these rules are urged to consult with their own tax advisors in this regard.
Alternative Minimum Tax
A capital gain realized or a dividend deemed to
be received by a Canadian Holder who is an individual, including a trust (other than certain specified trusts), as a result of the sale
of Shares pursuant to the Offer may give rise to a liability for alternative minimum tax. Such Canadian Holders should consult their own
tax advisors with respect to the alternative minimum tax rules set out in the Tax Act.
Shareholders Not Resident in Canada
The following portion of the summary is, subject
to the discussion under “General” above, applicable to a Shareholder who, for purposes of the Tax Act and at all relevant
times, (i) is not, and is not deemed to be, resident in Canada, (ii) does not use or hold, and is not deemed to use or hold, its Shares
in connection with carrying on a business in Canada, (iii) deals at arm’s length with, and is not affiliated with, illumin, and
(iv) is not an insurer that carries on an insurance business in Canada and elsewhere (a “Non-Canadian Holder”).
A Non-Canadian Holder who sells Shares to illumin
pursuant to the Offer will be deemed to receive a dividend equal to the excess, if any, of the amount paid by illumin for Shares over
the paid-up capital of such Shares for purposes of the Tax Act. The Corporation estimates that the paid-up capital per Share on the date
hereof is approximately $2.30 (and, following the Expiration Date, illumin will advise Shareholders of any material change to this estimate).
The exact quantum of the deemed dividend, if any, cannot be guaranteed.
Any dividend deemed to be received by a Non-Canadian
Holder will be subject to Canadian withholding tax at a rate of 25% or such lower rate as may be substantiated under the terms of an applicable
tax treaty. For example, a dividend received or deemed to be received by a Non- Canadian Holder that is a resident of the United States
for the purposes of the Canada-United States Income Tax Convention (the “U.S. Treaty”), is fully entitled to benefits
under the U.S. Treaty, and is the beneficial owner of such dividends will generally be subject to withholding tax at a treaty-reduced
rate of 15% (or 5% if the beneficial owner of such dividends is a company that owns at least 10% of Shares).
In view of the potential deemed dividend tax
treatment described above on a sale of Shares pursuant to the Offer and the resulting Canadian withholding tax, Non-Canadian Holders who
wish to sell their Shares should consult their own tax advisors regarding selling their Shares in the market as an alternative to selling
Shares pursuant to the Offer.
The amount paid by illumin pursuant to the Offer
for Shares less any amount deemed to be received by the Non-Canadian Holder as a dividend will be treated as proceeds of disposition of
Shares. A Non-Canadian Holder will not be subject to tax under the Tax Act on any capital gain realized on the disposition of Shares pursuant
to the Offer unless Shares are “taxable Canadian property” to the Non-Canadian Holder for purposes of the Tax Act and Shares
are not “treaty-protected property” of the Non-Canadian Holder for purposes of the Tax Act at the time of disposition.
Generally, Shares will not constitute taxable
Canadian property to a Non-Canadian Holder at the time of disposition provided that Shares are listed at that time on a designated stock
exchange for purposes of the Tax Act (which currently includes the TSX and Nasdaq), unless at any particular time during the 60-month
period that ends at that time: (i) one or any combination of (a) the Non-Canadian Holder, (b) persons with whom the Non-Canadian Holder
does not deal at arm’s length, and (c) partnerships in which the Non-Canadian Holder or a person described in (b) holds a membership
interest directly or indirectly through one or more partnerships, owned 25% or more of the issued shares of any class or series of the
capital stock of illumin; and (ii) more than 50% of the fair market value of Shares was derived directly or indirectly from one or any
combination of (a) real or immovable property situated in Canada, (b) “Canadian resource properties” (as defined in the Tax
Act), (c) “timber resource properties” (as defined in the Tax Act), and (d) options in respect of, or interests in, or for
civil law rights in, property described in any of the foregoing whether or not the property exists. Notwithstanding the foregoing, in
certain circumstances set out in the Tax Act, Shares could be deemed to be taxable Canadian property.
Even if Shares are taxable Canadian property to
a Non-Canadian Holder, a taxable capital gain resulting from the disposition of Shares will not be included in computing the Non-Canadian
Holder’s taxable income earned in Canada for purposes of the Tax Act if, at the time of the disposition, Shares constitute treaty
protected property of the Non-Canadian Holder for purposes of the Tax Act at the time of the disposition. Shares will generally be considered
treaty-protected property of a Non-Canadian Holder for purposes of the Tax Act at the time of the disposition if the gain from their disposition
would, because of an applicable income tax treaty between Canada and the country in which the Non-Canadian Holder is resident for purposes
of such treaty and in respect of Non-Canadian Holder the Non-Canadian Holder is entitled to receive benefits thereunder, be exempt from
tax under the Tax Act.
In the event that Shares are considered to be
taxable Canadian property but not treaty-protected property, such Non-Canadian Holder will generally realize a capital gain (or capital
loss) as if the Non-Canadian Holder were resident in Canada, as described above under “Shareholders Resident in Canada –
Disposition of Shares and Deemed Dividend” and “Shareholders Resident in Canada – Taxation of Capital Gains and
Losses”.
Non-Canadian Holders whose Shares are or may
be taxable Canadian property should consult their own advisors for advice having regard to their particular circumstances, including whether
their Shares constitute treaty-protected property.
| 12.2 | Certain United States Federal Income Tax Considerations to United States Holders |
The following is a general summary of certain
material United States federal income tax consequences generally applicable to a beneficial owner of Shares that is a United States Holder
(as defined below) and that properly tenders and sells Shares to illumin pursuant to the Offer. This summary is based on the Code, the
Treasury regulations promulgated thereunder, and judicial and administrative interpretations thereof, all as in effect on the date hereof
and all of which are subject to change, possibly with retroactive effect, so as to result in United States federal income tax consequences
that are materially different from those discussed below. We have not requested and will not request a ruling from the IRS with respect
to any of the United States federal income tax consequences described below or any part of the Offer. The IRS may disagree with and challenge
any of the conclusions reached herein, and a court may sustain such position.
The summary applies only to United States Holders
that hold their Shares as capital assets within the meaning of Section 1221 of the Code (generally, property held for investment) and
does not purport to address all aspects of United States federal income taxation that may be relevant to particular United States Holders
in light of their particular circumstances. Specifically, the summary does not address the United States federal income tax consequences
to certain types of United States Holders subject to special treatment under the Code (including, but not limited to, banks and other
financial institutions, regulated investment companies, real estate investment trusts, tax-exempt entities, private foundations, charitable
remainder trusts, insurance companies, persons holding Shares as part of a hedging, integrated or conversion transaction, constructive
sale, “straddle” or other risk reduction strategy, persons that hold Shares as part of a “wash sale,” persons
who acquired Shares through the exercise or cancellation of employee stock options or otherwise as compensation for their services, United
States expatriates and former citizens or long-term residents of the United States, persons subject to the alternative minimum tax, brokers,
dealers or traders in securities or currencies, traders that elect mark-to-market treatment for their securities, investors that are subject
to the “applicable financial statement” rules under Section 451(b) of the Code, personal holding companies, “S”
corporations, tax-qualified retirement plans, holders whose functional currency is not the United States dollar, persons that own an interest
in a partnership or other pass-through entity that holds Shares, and persons that own, or are deemed to own for United States federal
income tax purposes 10% or more of the voting shares or value of illumin).
This summary does not address the United States
federal income tax consequences of the conversion or exercise of Options. Holders of Options are urged to seek tax advice from their own
tax advisors in this regard.
In addition, this summary does not discuss any
aspect of United States state and local tax laws or non-United States tax laws that may be applicable to any Shareholder, or any United
States federal tax considerations other than United States federal income tax considerations, such as estate and gift tax laws.
For purposes of this summary, a “United
States Holder” is (i) an individual citizen or resident of the United States, as determined for United States federal income
tax purposes, (ii) a corporation (or other entity treated as a corporation for United States federal income tax purposes) created or organized
under the laws of the United States or any state thereof or the District of Columbia, (iii) an estate, the income of which is subject
to United States federal income taxation regardless of its source, or (iv) a trust (A) if a court within the United States is able to
exercise primary supervision over its administration and one or more United States persons, as defined under Section 7701(a)(30) of the
Code, have authority to control all substantial decisions of the trust or (B) that has a valid election in effect under applicable Treasury
regulations to be treated as a United States person.
The tax treatment of a partner in a partnership,
or other entity treated as a partnership for United States federal income tax purposes, will generally depend on the status of the partner
and the activities of the partnership. Partnerships tendering Shares and persons holding beneficial interests in Shares through a partnership
are urged to consult their own tax advisors.
This summary is of a general nature only. It
is not intended to constitute, and should not be construed to constitute, legal or tax advice to any particular United States Holder.
United States Holders are urged to consult their own tax advisors as to the specific tax consequences of the Offer to them in light of
their particular circumstances, including tax return reporting requirements, the applicability and effect of United States federal, state,
local and any non-United States tax laws, and the effect of any proposed changes in applicable tax laws.
General
A United States Holder’s exchange of Shares
for cash pursuant to the Offer generally will be a taxable transaction for United States federal income tax purposes. As discussed below,
the United States federal income tax consequences to a United States Holder may vary depending upon the United States Holder’s particular
facts and circumstances. In particular, whether the exchange is properly treated as a sale or exchange or a distribution will depend on
the facts applicable to a United States Holder’s particular situation. Accordingly, United States Holders should consult their own
tax advisors as to the United States federal income tax consequences to them of participating in the Offer.
Treatment as a Sale or Exchange
Under Section 302 of the Code, a transfer of Shares
to illumin by a United States Holder pursuant to the Offer will, as a general rule, be treated as a sale or exchange of Shares for United
States federal income tax purposes only if the receipt of cash upon the sale (a) is “substantially disproportionate” with
respect to the United States Holder, (b) results in a “complete redemption” of the United States Holder’s interest in
illumin or (c) is “not essentially equivalent to a dividend” with respect to the United States Holder. These tests (the “Section
302 tests”) are explained more fully below.
If any of the Section 302 tests is satisfied,
a tendering United States Holder will recognize gain or loss equal to the difference between the amount realized (generally determined
as described below and before any withholding tax) by the United States Holder pursuant to the Offer and the United States Holder’s
tax basis in Shares sold pursuant to the Offer. Generally, a United States Holder’s tax basis in Shares will be equal to the cost
of Shares to the United States Holder reduced (but not below zero) by any previous returns of capital. Subject to the discussion of the
passive foreign investment company (“PFIC”) rules below, the gain or loss will be a capital gain or loss, which will
be a long-term capital gain or loss if Shares have been held for more than one year. Currently, the maximum long-term capital gain rate
for non-corporate United States Holders, including individual United States Holders, is 20%. Certain limitations apply to the deductibility
of capital losses by United States Holders. A United States Holder holding more than one block of Shares (generally, those acquired at
the same cost in a single transaction) can choose the tax basis and holding period of the stock redeemed by adequately identifying the
tendered Shares. Absent such an identification, Shares earliest acquired by the United States Holder among such United States Holder’s
total ownership will be those considered tendered pursuant to the Offer. United States Holders holding more than one block of Shares are
urged to consult their own tax advisors regarding the process to adequately identify tendered Shares.
Treatment as a Distribution
If none of the Section 302 tests is satisfied,
the full amount received by the United States Holder with respect to the purchase of Shares pursuant to the Offer will be treated as a
distribution by illumin in respect of such United States Holder’s Shares. Subject to the discussion of the PFIC rules below, this
distribution will be treated as a dividend to the United States Holder to the extent of the United States Holder’s share of illumin’s
current and accumulated earnings and profits, if any, as determined under United States federal income tax principles. Assuming that illumin
is not a PFIC in the current or a prior taxable year and subject to certain requirements (including certain holding period requirements),
such dividends received by non-corporate United States Holders, including individual United States Holders, are generally taxable as “qualified
dividend income” at a maximum tax rate of 20%. To the extent that the amount received by a United States Holder exceeds the United
States Holder’s share of illumin’s current and accumulated earnings and profits, the excess first will be treated as a tax-free
return of capital to the extent of the United States Holder’s tax basis in its Shares and the United States Holder’s tax basis
in its Shares will be reduced (but not below zero) by such excess. Any remainder will be treated as capital gain from the sale of Shares.
The Corporation does not currently expect to calculate its earnings and profits under United States federal income tax principles and
cannot provide United States Holders with such information. Therefore, United States Holders should expect the entire amount received
pursuant to the Offer to be treated as a dividend if such amount is treated as a distribution as described above.
If, with respect to a United States Holder, the
tender and sale of Shares pursuant to the Offer is treated as a distribution by illumin with respect to such United States Holder’s
Shares, such United States Holder’s adjusted tax basis in its remaining Shares generally will be increased by such United States
Holder’s adjusted tax basis in Shares tendered and sold pursuant to the Offer and will be decreased by any portion of such United
States Holder’s proceeds from the Offer that are treated as a tax-free return of capital as described above. A dividend received
by a corporate United States Holder may be subject to certain special rules for “extraordinary dividends”. No assurance can
be given that any of the Section 302 tests (discussed below) will be satisfied as to any particular United States Holder, and thus no
assurance can be given that any particular United States Holder will not be treated as having received a dividend for United States federal
income tax purposes.
Constructive Ownership of Shares
In determining whether any of the Section 302
tests is satisfied, a United States Holder must take into account not only Shares actually owned by the United States Holder, but also
Shares that are constructively owned by the United States Holder pursuant to Section 318 of the Code. Under Section 318 of the Code, a
United States Holder may constructively own Shares actually owned, and in some cases constructively owned, by certain related individuals
and certain entities in which the United States Holder has an interest or that have an interest in the United States Holder, as well as
any Shares the United States Holder has a right to acquire by exercise of an option, or by the conversion or exchange of a security.
The Section 302 Tests
One of the following tests must be satisfied in
order for the sale of Shares pursuant to the Offer to be treated as a sale or exchange rather than as a distribution for United States
federal income tax purposes. United States Holders are urged to consult their own tax advisors concerning the application of the Section
302 tests to their particular circumstances.
| (a) | “Substantially Disproportionate” Test – The receipt of cash by a United States Holder
will have the effect of a “substantially disproportionate” distribution by illumin with respect to the United States Holder
if the percentage of the outstanding voting shares of illumin actually and constructively owned by the United States Holder immediately
following the sale of Shares pursuant to the Offer (treating Shares purchased pursuant to the Offer as not outstanding) is less than 80%
of the percentage of the outstanding voting shares of illumin actually and constructively owned by the United States Holder immediately
before the exchange (treating Shares purchased by illumin pursuant to the Offer as outstanding). |
| (b) | “Complete Redemption” Test – The receipt of cash by a United States Holder will be treated
as a complete redemption of a United States Holder’s equity interest in illumin if either (i) all Shares actually and constructively
owned by the United States Holder are sold pursuant to the Offer, or (ii) all Shares actually owned by the United States Holder are sold
pursuant to the Offer and the United States Holder is eligible to waive, and effectively waives, the attribution of all shares of illumin
constructively owned by the United States Holder in accordance with the procedures described in Section 302(c)(2) of the Code and the
Treasury regulations promulgated thereunder. |
| (c) | “Not Essentially Equivalent to a Dividend” Test – The receipt of cash by a United States
Holder will generally be treated as “not essentially equivalent to a dividend” if the United States Holder’s sale of
Shares pursuant to the Offer results in a “meaningful reduction” of the United States Holder’s proportionate interest
in illumin. Whether the receipt of cash by the United States Holder will be treated as not essentially equivalent to a dividend will depend
on the particular facts and circumstances, including the number of Shares purchased by illumin pursuant to the Offer. However, in certain
circumstances, in the case of a United States Holder holding a small minority interest in Shares, it is possible that even a small reduction
in such interest may be treated as a “meaningful reduction,” and thus may satisfy the “not essentially equivalent to
a dividend” test. The IRS has ruled that a small reduction by a minority shareholder whose relative stock interest is minimal and
who exercises no control over the affairs of the corporation will meet this test. United States Holders are urged to consult their own
tax advisors concerning the application of the “not essentially equivalent to a dividend” test to their particular circumstances. |
Under certain circumstances, it may be possible
for a tendering United States Holder to satisfy one of the Section 302 tests by contemporaneously selling or otherwise disposing of all
or some Shares that are actually or constructively owned by the United States Holder but that are not purchased pursuant to the Offer.
Correspondingly, a United States Holder may fail to satisfy any of the Section 302 tests because of contemporaneous acquisitions of Shares
by the United States Holder or by a related party whose Shares are constructively owned by the United States Holder. United States Holders
are urged to consult their own tax advisors regarding the consequences of such sales or acquisitions in their particular circumstances.
We cannot predict whether or the extent to which
the Offer will be over-subscribed. If the Offer is oversubscribed, illumin’s purchase of Shares tendered may be prorated. Thus,
even if all Shares actually and constructively owned by a United States Holder are tendered, it is possible that not all Shares will be
purchased by illumin, which in turn may affect the United States Holder’s United States federal income tax consequences, in particular,
the United States Holder’s ability to satisfy one of the Section 302 tests described above.
Passive Foreign Investment Company
Special United States federal income tax rules
apply to United States Holders owning stock of a PFIC. A foreign corporation will be considered a PFIC for any taxable year in which (i)
75% or more of its gross income is passive income, or (ii) 50% or more of the value (determined on the basis of a quarterly average) of
its assets are considered “passive assets” (generally, assets that generate passive income).
The Corporation does not believe that it is, or
has been at any time since its public offering, a PFIC for United States federal income tax purposes, but this conclusion depends on complex
factual determinations that are made annually (including the fair market value of our assets, which may fluctuate substantially due to
changes in our market capitalization and share price, and our spending schedule for our cash balances) and thus there can be no assurance
that illumin is not and has not been a PFIC. If illumin were to be treated as a PFIC at any time during a United States Holder’s
holding period in a Share, gain realized on the sale or other disposition of such Share would in general not be treated as capital gain.
Instead, unless a United States Holder makes, or has made, certain elections with respect to such United States Holder’s Shares,
such United States Holder would be treated as if it had realized such gain and certain “excess distributions” ratably over
its holding period for Shares. If illumin were to be treated as a PFIC, the amounts allocable to the taxable year of the sale or other
disposition of Shares and to any taxable year in such United States Holder’s holding period for Shares before illumin became a PFIC
would be taxable as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate on ordinary
income in effect for individuals or corporations, as appropriate for that taxable year, and an interest charge would be imposed on the
resulting tax liability. With certain exceptions, a United States Holder’s Shares will be treated as stock in a PFIC if illumin
were a PFIC at any time during such United States Holder’s holding period in its Shares. Dividends received by a United States Holder
from illumin will not be eligible for the tax rates applicable to “qualified dividend income” if illumin is treated as a PFIC
with respect to such United States Holder either in the taxable year of the distribution or the preceding taxable year, but instead will
be taxable at rates applicable to ordinary income.
The rules dealing with PFICs and associated
elections are very complex and are affected by various factors in addition to those described above. United States Holders are urged to
consult their own tax advisors regarding the adverse United States federal income tax consequences of owning stock of a PFIC and of making
certain elections designed to lessen those adverse consequences.
Foreign Tax Credit
A United States Holder may be subject to Canadian
withholding tax on certain of the amounts to be paid to such holder in connection with the Offer. See “Certain Canadian Federal
Income Tax Considerations – Shareholders Not Resident in Canada,” above. The amount subject to Canadian withholding
tax may be greater than the amount of gain actually recognized by such holder for United States federal income tax purposes. The ability
of a United States Holder to claim a foreign tax credit with respect to any Canadian taxes withheld on amounts received pursuant to the
Offer is subject to complex limitations, including the general limitation that the credit cannot exceed the proportionate share of a United
States Holder’s United States federal income tax liability that such United States Holder’s “foreign source” taxable
income bears to such United States Holder’s worldwide taxable income. In general, for United States foreign tax credit limitation
purposes, amounts that are treated as dividends paid by illumin will be treated as foreign source income, but amounts received by a United
States Holder that are treated as gains from a sale or exchange of Shares generally will be treated as income from sources within the
United States. Accordingly, the ability of a United States Holder to obtain a foreign tax credit in respect of amounts treated as gains
from the sale or exchange of Shares may require that such United States Holder qualify for the full benefits of the U.S. Treaty and properly
make an election pursuant to the U.S. Treaty and the Code pursuant to which such gains would be treated as foreign source income for United
States federal income tax purposes. The application of this election in connection with the Offer is subject to uncertainty.
Even if a United States Holder makes such an election,
the ability of such holder to obtain a foreign tax credit with respect to Canadian taxes withheld in connection with the Offer will remain
subject to a number of complex limitations provided in the Code and Treasury regulations. The limitation on foreign taxes eligible for
credit is calculated separately with respect to specific classes of income. For this purpose, amounts treated as dividends with respect
to the Offer generally will constitute “passive category income.” The rules governing the foreign tax credit are complex.
United States Holders are urged to consult their own United States tax advisors regarding the availability of the foreign tax credit under
their particular circumstances.
Additional Tax on Investment Income
United States Holders who are individuals, estates,
or trusts and whose income exceeds certain thresholds will be required to pay (in addition to other United States federal income tax)
a 3.8% tax on net investment income, including dividends and gains from the sale or other taxable disposition of Shares. United States
Holders are urged to consult their own tax advisors regarding whether this tax will apply to them.
Information Reporting and Backup Withholding
A United States Holder that is considered a “significant
holder” within the meaning of U.S. Treasury regulation Section 1.302-2(b) may be required to comply with the reporting requirements
of such regulation. Proceeds from the sale of Shares pursuant to the Offer will generally be subject to information reporting to the IRS.
A United States Holder may be subject to backup withholding tax (at a rate of 24%) with respect to payments made to it unless the United
States Holder provides an accurate taxpayer identification number and certifies, among other things, that such number is correct. Backup
withholding is not an additional tax. The amount of any backup withholding collected will be allowed as a refund or credit against the
United States Holder’s United States federal income tax liability, provided that the required information is furnished to the IRS
in a timely manner.
| 13. | Legal Matters and Regulatory Approvals |
The Corporation is not aware of any license or
regulatory permit that is material to the Corporation’s business that might be adversely affected by the Corporation’s acquisition
of Shares pursuant to the Offer or, except as noted below, of any approval or other action by any government or governmental, administrative
or regulatory authority or agency in any jurisdiction, that would be required for the acquisition or ownership of Shares by the Corporation
pursuant to the Offer and that has not been obtained on or before the date hereof. Should any such approval or other action be required,
the Corporation currently contemplates that such approval will be sought or other action will be taken. The Corporation cannot predict
whether it may determine that it must delay the acceptance for payment of Shares tendered pursuant to the Offer pending the outcome of
any such matter.
There can be no assurance that any such approval
or other action, if needed, would be obtained or would be obtained without substantial conditions or that the failure to obtain any such
approval or other action might not result in adverse consequences to the Corporation’s business. The Corporation is relying on the
“liquid market exemption” specified in MI 61-101. Accordingly, the valuation requirements of securities regulatory authorities
in Canada applicable to issuer bids generally are not applicable in connection with the Offer.
The Corporation’s obligations under the
Offer to take up and pay for Shares are subject to certain other conditions. See “Offer to Purchase – Conditions of the Offer”.
Assuming that the Offer is fully subscribed, the
value of Shares purchased in the Offer will be $40,000,000. The Corporation intends to fund any purchases of Shares pursuant to the Offer
from cash on hand. The Offer is not conditional on the receipt of financing.
Canaccord Genuity and Canaccord Genuity US have
been retained to serve as dealer managers in Canada and the United States, respectively. Canaccord Genuity has also been retained as the
Corporation’s financial advisor in connection with the Offer. The Dealer Managers may communicate with investment dealers, stock
brokers, commercial banks, trust companies and dealers with respect to the Offer.
Canaccord Genuity and Canaccord Genuity US and
their respective affiliates have provided, and may in the future provide, various investment banking, commercial banking and other services
to us, for which they have received, or we expect they will receive, customary compensation from us.
In the ordinary course of business, including
in their trading and brokerage operations and in a fiduciary capacity, the Dealer Managers and their respective affiliates may hold positions,
both long and short, for their own accounts and for those of their customers, in our securities. The Dealer Managers may from time to
time hold Shares in their proprietary accounts, and, to the extent they own Shares in these accounts at the time of the Offer, the Dealer
Managers may tender Shares pursuant to the Offer.
The Corporation has appointed TSX Trust Company
to act as a depositary for, among other things, (i) the receipt of certificates and/or DRS representing Shares and related Letters of
Transmittal tendered under the Offer, (ii) the receipt of Notices of Guaranteed Delivery delivered pursuant to the procedures for guaranteed
delivery set forth under “Offer to Purchase – Procedure for Tendering Shares”, (iii) the receipt from the Corporation
of cash to be paid in consideration of Shares acquired by the Corporation under the Offer, as agent for the tendering Shareholders, and
(iv) the transmittal of such cash to the tendering Shareholders, as agent for the tendering Shareholders. The Depositary may contact Shareholders
by mail, telephone or facsimile and may request brokers, dealers and other nominee Shareholders to forward materials relating to the Offer
to beneficial owners.
Canaccord Genuity will receive fees from illumin
for its services as dealer manager in Canada, financial advisor and provider of the Liquidity Opinion, and Canaccord Genuity US will receive
fees from illumin for its services as dealer manager in the United States. The Corporation has agreed to reimburse the Dealer Managers
for certain reasonable out-of-pocket expenses incurred in connection with the Offer and to indemnify the Dealer Managers against certain
liabilities to which they may become subject as a result of their engagement as dealer managers and financial advisor, as applicable,
including liabilities under applicable securities law. The fees paid to Canaccord Genuity for its services in providing the Liquidity
Opinion are not contingent upon the conclusions reached by Canaccord Genuity in the Liquidity Opinion.
The Corporation has retained TSX Trust Company
to act as the depositary in connection with the Offer. The Depositary will receive reasonable and customary compensation for its services,
will be reimbursed for certain reasonable out-of-pocket expenses and will be indemnified against certain liabilities and expenses in connection
with the Offer, including certain liabilities under Canadian provincial securities laws.
The Corporation will not pay any fees or commissions
to any stock broker or dealer or any other person for soliciting deposits of Shares pursuant to the Offer. Stock brokers, dealers, commercial
bankers and trust companies will, upon request, be reimbursed by illumin for reasonable and necessary costs and expenses incurred by them
in forwarding materials to their customers.
The Corporation expects to incur expenses of approximately
$650,000 in connection with the Offer, which includes filing fees, dealer manager fees, the fees for the Liquidity Opinion, legal, translation,
accounting, summary advertisement, depositary and printing fees.
Securities legislation in the provinces and territories
of Canada provides security holders of the offeree issuer 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 notice that is required to be delivered to
Shareholders. 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.
APPROVAL
AND CERTIFICATE
July 27, 2023
The Board of Directors of illumin Holdings Inc.
has approved the contents of the Offer to Purchase and the accompanying Issuer Bid Circular dated July 27, 2023 and the sending, communication
or delivery thereof to the holders of its common shares. The foregoing 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 the light of the circumstances
in which it was made.
|
(signed) “Tal Hayek”
Chief Executive Officer |
|
(signed) “Elliot Muchnik”
Chief Financial Officer |
| |
|
|
| On behalf of the Board of Directors |
| |
|
|
|
(signed) “Sheldon Pollack”
Director |
|
(signed) “Igal Mayer”
Director |
CONSENT
OF CANACCORD GENUITY CORP.
To: The Board of Directors of illumin Holdings
Inc.
We consent to the inclusion of our name and the
reference to our Liquidity Opinion dated July 26, 2023 in the section titled “Purpose and Effect of the Offer – Liquidity
of Market” in the Issuer Bid Circular dated July 27, 2023 of illumin Holdings Inc. in connection with its offer to the holders of
its common shares, and the inclusion of the text of our opinion in Schedule A thereof. Our Liquidity Opinion was given as at July 26,
2023 and remains subject to the assumptions, qualifications and limitations contained therein. In providing our consent, we do not intend
that any person other than the directors of illumin Holdings Inc. will be entitled to rely upon our opinion.
July 27, 2023
(signed) “Canaccord Genuity Corp.”
SCHEDULE
A
LIQUIDITY OPINION OF CANACCORD GENUITY CORP.
See attached.
The Letter of Transmittal, certificates for Shares
and any other required documents must be sent or delivered by each tendering Shareholder or the tendering Shareholder’s broker,
dealer, commercial bank, trust company or other nominee to the Depositary at one of its mailing addresses specified below. Any other questions
or requests may be directed to the Depositary at the email address, facsimile and telephone numbers specified below.
TSX Trust Company
By Mail
301 – 100 Adelaide St W
Toronto, ON M5H 4H1
Attention: Corporate Actions
By Hand, Courier or Registered Mail
301 – 100 Adelaide St W
Toronto, ON M5H 4H1
Attention: Corporate Actions
Inquiries
Telephone: 416-342-1091
Toll Free: 1-866-600-5869
E-mail: tsxtis@tmx.com
| DELIVERY OF THE LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY. |
| Any questions or requests for assistance may be directed to the Depositary at the addresses and telephone number specified above. Shareholders also may contact their broker, commercial bank, trust company or other nominee for assistance concerning the Offer. Additional copies of the Offer to Purchase and the Circular, the Letter of Transmittal and the Notice of Guaranteed Delivery may be obtained from the Depositary. Manually executed photocopies of the Letter of Transmittal will be accepted. |
The Dealer Managers for the Offer are:
In
Canada:
Canaccord
Genuity Corp.
40
Temperance Street, Suite 2100
Toronto,
Ontario
M5H
0B4
Email:
ecm@cgf.com |
|
In
the United States:
Canaccord
Genuity LLC
99
High Street, 12th Floor
Boston,
MA
02110
Email:
ecm@cgf.com
|
Exhibit
(a)(1)(B)
The undersigned
represents that I (we) have full authority to tender without restriction the certificate(s) listed below. You are hereby authorized and
instructed to deliver to the address indicated below (unless otherwise instructed in the boxes in the following page) a cheque representing
a cash payment for common shares (“Shares”) of illumin Holdings Inc. (the “Corporation”) tendered
pursuant to this Letter of Transmittal, for purchase by us at a price not greater than $2.65 nor less than $2.53 per Share, to the seller
in cash, less any applicable withholding taxes and without interest, upon the terms and subject to the conditions in the Offer to Purchase
dated July 27, 2023 (together with any amendments, supplements or variations thereto, the “Offer to Purchase”), the
accompanying Issuer Bid Circular (the “Circular”) and this Letter of Transmittal (which, as amended or supplemented
from time to time, together with the Offer to Purchase and the Circular, constitute the “Offer”).
LETTER OF TRANSMITTAL
To Tender Common Shares of
ILLUMIN HOLDINGS INC.
Pursuant to the Offer to Purchase Dated July 27, 2023
| THE OFFER EXPIRES AT 5:00 P.M. (EASTERN TIME) ON AUGUST 30, 2023 UNLESS THE OFFER IS WITHDRAWN EXTENDED OR VARIED (SUCH TIME AND SUCH DATE, AS THEY MAY BE EXTENDED, THE “EXPIRATION TIME” AND THE “EXPIRATION DATE”, RESPECTIVELY). |
THIS FORM SHOULD BE COMPLETED, SIGNED AND SENT
TOGETHER WITH ALL OTHER DOCUMENTS, INCLUDING YOUR CERTIFICATES FOR SHARES TO TSX TRUST COMPANY (THE “DEPOSITARY”) AT THE ADDRESS
SET FORTH BELOW. DELIVERY OF THIS LETTER OF TRANSMITTAL OR OTHER DOCUMENTS TO AN ADDRESS OTHER THAN THE ADDRESS OF THE DEPOSITARY AS SET
FORTH BELOW DOES NOT CONSTITUTE VALID DELIVERY. DELIVERIES TO THE CORPORATION, THE BOOK-ENTRY TRANSFER FACILITY OR CANACCORD GENUITY CORP.
AND CANACCORD GENUITY LLC (TOGETHER, THE “DEALER MANAGERS”) WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT
CONSTITUTE VALID DELIVERY.
Offices of the Depositary, TSX Trust Company,
for this Offer:
301 – 100 Adelaide St W
Toronto, ON M5H 4H1
Attention: Corporate Actions
Telephone: 416-342-1091
Toll Free: 1-866-600-5869
E-mail: tsxtis@tmx.com
This Letter of Transmittal is to be used only
if (i) certificates for Shares are to be forwarded with it or (ii) if Shares are held through the Direct Registration System (“DRS”)
maintained by the Corporation’s transfer agent.
| TO: | illumin Holdings Inc., as the Corporation |
| AND TO: | TSX Trust Company, as the Depositary |
The undersigned delivers to the Corporation the
enclosed certificate(s) for Shares and/or Shares held through DRS, subject only to the provisions of the Offer to Purchase regarding withdrawal,
irrevocably accepts the Offer for such Shares upon the terms and conditions contained in the Offer to Purchase and Circular. The following
are the details of the enclosed certificate(s):
| DESCRIPTION OF SHARES TENDERED (See Instructions 3 and 4) |
| Certificate Number or DRS Account Number |
|
Name in which Shares are Registered |
Number of Shares Represented by Certificate or through DRS |
Number of Shares Tendered* |
| |
|
|
|
|
| |
|
|
|
|
| |
|
|
|
|
| Total………………………………………………………………… |
|
| * | If
you desire to tender fewer than all Shares evidenced by any share certificates, or held through
DRS listed above, indicate in this column the number of Shares you wish to tender. Otherwise,
all Shares evidenced by such share certificates and DRS will be considered to have been tendered.
If you wish to tender Shares held through DRS, you are only required to complete this Letter
of Transmittal and have it delivered to the Depositary, and you do not need to obtain and
deliver share certificates for these holdings. See Instruction 4 in this Letter of Transmittal. |
| The “Instructions” set forth in this Letter of Transmittal should be read carefully before this Letter of Transmittal is completed. |
The undersigned hereby tenders to the Corporation
Shares at the price per Share indicated in this Letter of Transmittal or pursuant to a Purchase Price Tender (as defined in the Offer
to Purchase), as specified below, payable in cash (net of applicable withholding taxes, if any) and upon the terms and subject to the
conditions of the Offer.
The terms and conditions of the Offer are incorporated
by reference in this Letter of Transmittal. Capitalized terms used and not defined in this Letter of Transmittal have the meanings ascribed
to them in the Offer to Purchase that accompanies this Letter of Transmittal. In the case of any inconsistency between the terms of this
Letter of Transmittal and the Offer to Purchase, the terms of the Offer to Purchase shall prevail.
This Letter of Transmittal, properly completed
and duly executed, together with all other required documents, must accompany the certificates for the Shares tendered pursuant to the
Offer. Any financial institution that is a participant in CDS or DTC may make book-entry delivery of the Shares through the online tendering
systems of such clearing systems pursuant to which book-entry transfers may be effected by causing the applicable clearing systems to
transfer such Shares into the Depositary’s account in accordance with such clearing system’s procedures for such transfer
and, in such cases, this Letter of Transmittal need not be completed in respect of such Shares. Shareholders who, through their respective
CDS or DTC participants, accept the Offer via a bookentry transfer of their holdings with CDS or through DTC’s ATOP procedures,
shall be deemed to have completed and submitted a Letter of Transmittal and to be bound by the terms thereof and therefore such instructions
received by the Depositary are considered to be a valid tender in accordance with the terms of the Offer. Shareholders of the Corporation
(“Shareholders”) whose certificates are not immediately available or who cannot complete the book-entry transfer procedure
or who cannot deliver to the Depositary their certificates for Shares or all other documents which this Letter of Transmittal requires
by the Expiration Date may only tender their Shares according to the guaranteed delivery procedure set forth under the title “Procedure
for Tendering Shares” of the Offer to Purchase. See Instruction 2 in this Letter of Transmittal.
A Shareholder who wishes to tender Shares under
the Offer and whose certificate is registered in the name of a broker, dealer, commercial bank, trust company or other nominee should
immediately contact such nominee in order to take the necessary steps to be able to tender such Shares under the Offer. If a broker, dealer,
commercial bank, trust company or other nominee holds Shares for a Shareholder, it is likely such nominee has established an earlier deadline
for that Shareholder to act to instruct the nominee to accept the Offer on such Shareholder’s behalf. A Shareholder should immediately
contact the Shareholder’s broker, dealer, commercial bank, trust company or other nominee to confirm any earlier deadline.
Shareholders should carefully consider the
income tax consequences of tendering Shares under the Offer. For some Shareholders, the tax treatment of selling Shares to the Corporation
under the Offer may be materially different from the tax treatment of selling Shares in the market. See “Income Tax Consequences”
in the Circular that accompanies this Letter of Transmittal.
Subject to and effective upon acceptance for purchase
of the Shares tendered hereby, pursuant to an Auction Tender (as defined in the Offer to Purchase) or pursuant to a Purchase Price Tender
in accordance with the terms of the Offer, the undersigned hereby sells, assigns and transfers to or upon the order of the Corporation
all rights, title and interest in and to all Shares tendered hereby, and in and to any and all rights, benefits and claims in respect
thereof or arising, or having arisen as a result of the undersigned’s status as a Shareholder and in and to any and all distributions,
payments, securities, rights, assets or other interests which may be declared, paid, issued, distributed, made or transferred, or may
be payable, issuable, distributable or transferable, on or in respect of such Shares or any of them on or after the date upon which the
Shares are taken up and paid for under the Offer, and hereby irrevocably constitutes and appoints the Depositary and any officer of the
Corporation as attorney-in-fact of the undersigned with respect to such Shares, effective from the time the Corporation takes up and pays
for such Shares, with full power of substitution (such power of attorney being an irrevocable power coupled with an interest), to:
| (a) | deliver certificates for such Shares, together with all accompanying evidences of transfer and authenticity,
to or upon the order of the Corporation upon receipt by the Depositary, as the undersigned’s agent, of the Purchase Price (as hereinafter
defined); |
| (b) | present certificates for such Shares for cancellation and transfer on the Corporation’s books; and |
| (c) | receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares, subject
to the next paragraph, all in accordance with the terms of the Offer. |
The undersigned hereby represents, warrants and
covenants severally and not jointly that:
| (a) | the undersigned understands that tendering Shares under any one of the procedures described in the Offer
to Purchase and the instructions hereto will constitute the undersigned’s acceptance of the terms and conditions of the Offer, including
the undersigned’s representation that (i) the undersigned has a “net long position” in Shares being tendered or equivalent
securities at least equal to the Shares tendered within the meaning of Rule 14e-4 under the United States Securities Exchange Act of
1934, as amended (the “Exchange Act”), and (ii) such tender of Shares complies with Rule 14e-4 under the Exchange
Act; |
| (b) | the undersigned is the owner of the number of Shares represented by the share certificate(s) described
above and delivered herewith and the undersigned has good title to the Shares represented by the said certificate(s), free and clear of
all hypothecs, liens, charges, encumbrances, security interests, claims, restrictions and equities whatsoever, and the undersigned has
full power and authority to enter into this Letter of Transmittal and to tender, sell, assign and transfer the Shares; |
| (c) | when and to the extent the Corporation accepts the Shares for payment, the Corporation will acquire good,
marketable, and unencumbered title thereto, free and clear of all hypothecs, liens, charges, encumbrances, security interests, claims,
restrictions and equities whatsoever, together with all rights and benefits arising therefrom, provided that any dividends or distributions
which may be paid, issued, distributed, made or transferred on or in respect of such Shares to Shareholders of record on or prior to the
date on which the Shares are taken up and paid for under the Offer shall be for the account of the undersigned; |
| (d) | on request, the undersigned will execute and deliver any additional documents that the Depositary or the
Corporation deems necessary or desirable to complete the assignment, transfer, and purchase of the Shares tendered hereby; and |
| (e) | the undersigned has read and agrees to all of the terms of the Offer. |
The names and addresses of the registered owners
should be printed, if they are not already printed above, as they appear on the certificates representing Shares tendered hereby. The
certificates representing Shares tendered and the number of Shares that the undersigned wishes to tender should all be indicated in the
appropriate boxes. If the tender is being made pursuant to an Auction Tender, the Purchase Price at which such Shares are being tendered
should be indicated in Box B – “Auction Tender”.
The undersigned understands that he, she or
it must indicate whether the Shares are being tendered pursuant to an Auction Tender or a Purchase Price Tender by completing Box A –
“Type of Tender”. All Shares tendered, and not withdrawn, by a Shareholder who fails to specify any Auction Tender price for
his, her or its Shares or fails to indicate that he, she or it has tendered his, her or its Shares pursuant to either an Auction Tender
or a Purchase Price Tender by completing Box A – “Type of Tender”, will be considered to have been tendered pursuant
to a Purchase Price Tender.
The undersigned understands that, upon the terms
and subject to the conditions of the Offer, the Corporation will determine a single price per Share (the “Purchase Price”),
which will not be less than $2.53 per Share and not more than $2.65 per Share, in increments of $0.01 per Share within that range, that
is the lowest price that enables it to purchase the maximum number of Shares properly tendered and not withdrawn pursuant to the Offer
having an aggregate Purchase Price not exceeding $40,000,000.
If the Purchase Price is determined to be $2.53 (which is the minimum Purchase Price under the Offer), the maximum number of Shares that
may be purchased by the Corporation is 15,810,276 Shares. If the Purchase Price is determined to be $2.65 (which is the maximum Purchase
Price under the Offer), the maximum number of Shares that may be purchased by the Corporation is 15,094,339 Shares. For the purpose of
determining the Purchase Price, Shares tendered pursuant to a Purchase Price Tender will be considered to have been tendered at $2.53
per Share (which is the minimum Purchase Price under the Offer). Shares tendered by a Shareholder pursuant to an Auction Tender will not
be purchased by the Corporation pursuant to the Offer if the price specified by the Shareholder is greater than the Purchase Price. A
Shareholder who wishes to tender Shares but who does not wish to specify a price at which such Shares may be purchased by the Corporation
should make a Purchase Price Tender, understanding that for the purpose of determining the Purchase Price, Shares tendered pursuant to
a Purchase Price Tender will be considered to have been tendered at the minimum price of $2.53 per Share. Shareholders who tender Shares
without making a valid Auction Tender or Purchase Price Tender will be deemed to have made a Purchase Price Tender.
The undersigned understands that, upon the terms
and subject to the conditions of the Offer (including the pro-ration provisions described in the Offer), all Shares properly tendered
and not properly withdrawn pursuant to an Auction Tender at prices at or below the Purchase Price and pursuant to Purchase Price Tenders
will be purchased at the Purchase Price, payable in cash (net of applicable withholding taxes, if any), for all Shares purchased. Certificates
for all Shares not purchased under the Offer (including Shares tendered pursuant to an Auction Tender at prices greater than the Purchase
Price and Shares not purchased because of pro-ration), or properly withdrawn, will be returned (in the case of certificates representing
Shares all of which are not purchased) or replaced with new certificates representing the balance of Shares not purchased (in the case
of certificates representing Shares of which less than all are purchased), promptly after the Expiration Date or the date of withdrawal
of the Shares, without expense to the Shareholder. The undersigned understands that a Shareholder who desires to tender Shares at more
than one price or under both an Auction Tender and a Purchase Price Tender must complete a separate Letter of Transmittal for each price
at which Shares are tendered.
The undersigned understands that if the aggregate
Purchase Price for the Shares properly tendered, and not withdrawn, pursuant to the Offer by a Purchase Price Tender or by an Auction
Tender at a price not greater than the Purchase Price (the “Successfully Tendered Shares”) by Shareholders (the “Successful
Shareholders”) exceeds $40,000,000, then the Successfully
Tendered Shares will be purchased on a pro rata basis according to the number of Shares tendered (or deemed to be tendered) by the Successful
Shareholders (with adjustments to avoid the purchase of fractional Shares), except that “Odd Lot” tenders will not
be subject to pro-ration. See “Offer to Purchase – Number of Shares and Pro-Ration” in the Offer to Purchase. The Corporation’s
determination as to pro-ration shall be final and binding on all parties, except as otherwise finally determined in a subsequent judicial
proceeding or as required by law.
The undersigned recognizes that under certain
circumstances set forth in the Offer to Purchase, and in accordance with applicable laws, the Corporation may terminate or amend the Offer
or may not be required to purchase any of the Shares tendered hereby or may accept for payment, in accordance with the applicable pro-ration
provisions relating to Shares tendered, fewer than all of the Shares tendered hereby by the undersigned. The undersigned understands and
acknowledges that certificate(s) for any Shares not tendered or not purchased will be returned to the undersigned at the address indicated
in Box E, unless otherwise indicated in Box F below or unless certificate(s) for Shares are to be held for pick-up by checking Box G below.
The undersigned recognizes that the Corporation has no obligation, pursuant to the instructions hereto, to transfer any certificates for
Shares from the name of the registered owner if Shares are not purchased pursuant to the Offer.
The undersigned understands and acknowledges that
acceptance of Shares by the Corporation for payment will constitute a binding agreement between the undersigned and the Corporation, effective
as of the Expiration Date, upon the terms and subject to the conditions of the Offer.
The undersigned understands and acknowledges that
payment for Shares accepted for payment pursuant to the Offer will be made on or about the date on which the Corporation delivers the
aggregate Purchase Price for such Shares to the Depositary (by bank transfer or other means satisfactory to the Depositary), which will
act as agent for Shareholders who have properly tendered Shares in acceptance of the Offer and have not withdrawn them, for the purposes
of receiving payment from the Corporation and transmitting payment to such Shareholders. The undersigned further understands and acknowledges
that receipt by the Depositary from the Corporation of payment for such Shares will be deemed to constitute receipt of payment by such
Shareholders. Under no circumstances will interest be paid by the Corporation or the Depositary by reason of any delay in paying for any
Shares or otherwise.
The undersigned understands and acknowledges that
each of the Corporation and the Depositary, as applicable, shall be entitled to deduct and withhold from any payment to any Shareholder
pursuant to the Offer such amount as it is required to deduct or withhold from such payment under the Income Tax Act (Canada),
or any provision of any applicable federal, provincial, territorial, state, local or foreign tax law, and remit such deducted or withheld
amount to the appropriate government entity. To the extent that amounts are deducted or withheld, such deducted or withheld amounts shall
be treated for all purposes of the Offer as having been paid to the Shareholder to whom such amounts would otherwise have been paid, provided
that such deducted or withheld amounts are actually remitted to the appropriate government entity.
The undersigned instructs the Corporation and
the Depositary to issue a cheque for the Purchase Price (less applicable withholding taxes, if any) for such of the tendered Shares as
are purchased to the order of the undersigned or the name listed and mailed to the address indicated in Box E, unless otherwise indicated
in Box F below, or Box G – “Hold for Pick-Up”. Such payment will be received in Canadian dollars.
All authority conferred or agreed to be conferred
by this Letter of Transmittal is irrevocable and may be exercised during any subsequent legal incapacity of the undersigned and shall,
to the extent permitted by applicable law, survive the death or incapacity, bankruptcy or insolvency of the undersigned and all obligations
of the undersigned under this Letter of Transmittal shall be binding upon the heirs, personal representatives, successors and assigns
of the undersigned.
If a share certificate has been lost, stolen or
destroyed, this Letter of Transmittal, including Box M – “Lost, Stolen or Destroyed Certificates” should be completed
as fully as possible and forwarded to the Depositary, together with a letter describing the loss, theft or destruction and providing a
telephone number. The Depositary will respond with the replacement requirements, which includes certain additional documents that must
be signed in order to obtain replacement certificate(s) and the payment of the required lost certificate fee.
The undersigned agrees not to vote any of the
tendered Shares taken up and paid for under the Offer, or distributions on such Shares consisting of securities, at any meeting and not
to exercise any of the other rights or privileges attaching to any of such tendered Shares or distributions consisting of securities,
or otherwise act with respect thereto. The undersigned agrees further to execute and deliver to the Corporation, provided not contrary
to any applicable law, at any time and from time to time, as and when requested by, and at the expense of the Corporation, any and all
instructions of proxy, authorization or consent, in form and on terms satisfactory to the Corporation, in respect of any such tendered
Shares or distributions consisting of securities. The undersigned agrees further to designate in any such instruments of proxy the person
or persons specified by the Corporation as the proxyholder of the undersigned in respect of such tendered Shares or distributions consisting
of securities.
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BOX A
TYPE OF TENDER
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Check only one box. If more than one box is checked or if no box is checked, all Shares identified above will be deemed to have been tendered pursuant to the Purchase Price Tender. Shares are being tendered hereby pursuant to: |
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☐ An Auction Tender
(Please complete Box B) |
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☐ Purchase
Price Tender
(Please complete
Box C) |
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BOX B
AUCTION TENDER
PRICE (IN CANADIAN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING
TENDERED |
| This box MUST be completed if Shares are being tendered pursuant to an Auction Tender. |
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| Check the appropriate box to indicate the Auction Tender price. |
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| Check only one box. If more than one box is checked or if no box is checked, all Shares identified above will be deemed to have been tendered pursuant to the Purchase Price Tender. |
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| If portions of shareholdings are being tendered at different prices, use a separate Letter of Transmittal for each price specified. See Instruction 5. |
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| ☐ $2.53 |
☐ $2.58 |
☐ $2.63 |
| ☐ $2.54 |
☐ $2.59 |
☐ $2.64 |
| ☐ $2.55 |
☐ $2.60 |
☐ $2.65 |
| ☐ $2.56 |
☐ $2.61 |
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| ☐ $2.57 |
☐ $2.62 |
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BOX C
PURCHASE PRICE TENDER
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This box MUST be completed if Shares are being tendered
pursuant to a Purchase Price Tender.
The undersigned either (check one): |
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| ☐ is tendering Shares beneficially owned by the undersigned; or |
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| ☐ is a broker, dealer, bank, trust company or other nominee that is tendering, for the beneficial owners thereof, Shares with respect to which it is the owner of record (list attached). |
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BOX D
ODD LOTS
(See Instruction 6)
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To be completed ONLY if Shares are being tendered
by or on behalf of persons beneficially owning an aggregate of fewer than 100 Shares as of the close of business on the Expiration Date.
The undersigned either (check one):
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| ☐ will be the beneficial owner of an aggregate of fewer than 100 Shares as of the close of business on the Expiration Date, all of which are tendered, or |
| ☐ is a broker, dealer, commercial bank, trust company or other nominee that (i) is tendering, for the beneficial owners thereof, Shares with respect to which it is the record owner, and (ii) believes, based upon representations made to it by each such beneficial owner, that such beneficial owner will own an aggregate of fewer than 100 Shares as of the close of business on the Expiration Date and is tendering all such Shares. |
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BOX E
ISSUE CHEQUE AND/OR CERTIFICATE(S) / DRS IN THE NAME OF: (please print) |
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BOX F
SEND CHEQUE AND/OR CERTIFICATE(S) /
DRS IN (Unless Box “G” is checked)
TO: |
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(Name) |
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(Name) |
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(Street Address and Number) |
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(Street Address and Number) |
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(City and Province or State) |
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(City and Province or State) |
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(Country and Postal (Zip) Code) |
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(Country and Postal (Zip) Code) |
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(Social Insurance or Social Security Number) |
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BOX G
HOLD FOR PICKUP |
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☐ Hold certificates for Shares and/or cheques for pick-up. |
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BOX H
CANADIAN WITHHOLDING TAX |
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The following certifications assume that the undersigned is either (i) the beneficial holder of the Shares tendered (the “Beneficial Owner”), or (ii) holds the Shares tendered on behalf of one or more Beneficial Owners. |
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I. Tax Residency |
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All Shareholders must complete the following. See Instruction 11. |
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The undersigned certifies that the Beneficial Owner(s) (please check one box only): |
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☐ is (are all) resident in Canada for purposes of the Income Tax Act (Canada) (the “Tax Act”) or, if a partnership, is a “Canadian partnership” for the purposes of the Tax Act; |
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☐ is (are all) not resident in Canada for purposes of the Tax Act or, if a partnership, is not a “Canadian partnership” for the purposes of the Tax Act; or |
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☐ include Beneficial Owners who are resident in Canada and not resident in Canada for purposes of the Tax Act, and the aggregate number of Shares tendered on behalf of each is as follows: |
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☐ Beneficial Owners resident in Canada _____________ tendered Shares |
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☐ Beneficial Owners not resident in Canada ______________ tendered Shares |
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II. Non-Residents of Canada |
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Shareholders are only required to complete the following if the Beneficial Owners(s) is(are) not resident in Canada for purposes of the Tax Act. See Instruction 11. |
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Applicability of a Tax Treaty |
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Non-resident withholding tax will generally apply, at a rate of 25%, to certain amounts paid or deemed to be paid in respect of Shares beneficially owned by persons not resident in Canada for purposes of the Tax Act. Withholding tax may arise for example with respect to a deemed dividend arising pursuant to the Offer, if any. However, if the Beneficial Owner is entitled to the benefits of a tax treaty entered into between Canada and the Beneficial Owner’s country of residence, the withholding tax rate may be reduced to less than 25%. To benefit from a reduced rate of withholding under a tax treaty, the Shareholder must properly complete and provide the documentation described below. |
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(continues on next page) |
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The undersigned certifies that (please check one box only): |
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☐ The Shareholder is the Beneficial Owner of the tendered Shares and either (please check one box only): |
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☐ the Shareholder has completed the Canada Revenue Agency’s Form NR 301 – Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person*, which is included with this Letter of Transmittal; or |
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☐ the Shareholder has not completed or provided Form NR 301 – Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person;** or |
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☐ The Shareholder is not the Beneficial Owner of the tendered Shares, there is only one Beneficial Owner and either (please check one box only): |
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☐ the Beneficial Owner has completed the Canada Revenue Agency’s Form NR 301 – Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person,* which is included with this Letter of Transmittal; or |
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☐ the Beneficial Owner has not completed or provided Form NR 301 – Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person;** or |
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☐ The Shareholder is not the Beneficial Owner of the tendered Shares, there is more than one Beneficial Owner and (please check all applicable boxes): |
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☐ the Beneficial Owners holding tendered Shares have completed the Canada Revenue Agency’s Form NR 301 – Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person,* and these Forms, together with Schedule A ,** are included with this Letter of Transmittal; and/or |
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☐ the Beneficial Owners holding tendered Shares have not completed or provided Form NR 301 – Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person.** |
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If the Shareholder is a company, the undersigned certifies that (please check one box only): |
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☐ The corporate Shareholder is the Beneficial Owner of at least 10% of the issued and outstanding voting shares of the Corporation. |
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☐ The corporate Shareholder is not the Beneficial Owner of at least 10% of the issued and outstanding voting shares of the Corporation. |
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* Partnerships or hybrid entities must complete Form NR 302 (Declaration of eligibility for benefits (reduced tax) under a tax treaty for a partnership with non-resident partners) or Form NR 303 (Declaration of eligibility for benefits (reduced tax) under a tax treaty for a hybrid entity), as applicable. |
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** FAILURE TO PROVIDE THIS INFORMATION WILL RESULT IN THE APPLICATION OF A 25% WITHHOLDING TAX RATE TO A DEEMED DIVIDEND ARISING PURSUANT TO THE OFFER, IF ANY. |
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BOX I
STATUS AS U.S. SHAREHOLDER
(Please check the appropriate box) |
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Indicate whether or not you are a U.S. Shareholder or are acting on behalf of a U.S. Shareholder by placing an “X” in the applicable box below. A U.S. Shareholder is any holder of Shares that is either (a) providing an address in Box K (or, if completed, either Box E or Box F) that is located within the United States or any territory or possession thereof or (b) a U.S. person for United States federal income tax purposes as defined in “Important U.S. Tax Information for U.S. Shareholders” below. |
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☐ The person signing this Letter of Transmittal is not a U.S. Shareholder and is not acting on behalf of a U.S. Shareholder. |
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☐ The person signing this Letter of Transmittal is a U.S. Shareholder or is acting on behalf of a U.S. Shareholder. |
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If you are a U.S. Shareholder or acting on behalf of a U.S. Shareholder, then in order to avoid U.S. backup withholding, you must generally complete the enclosed IRS Form W-9 unless the U.S. Shareholder is not a U.S. person for U.S. federal income tax purposes. If you are a U.S. Shareholder but you are not a U.S. person for U.S. federal income tax purposes, then you must complete the appropriate IRS Form W-8 to avoid backup withholding. If you require an IRS Form W-8, please contact the Depositary or download the appropriate IRS Form W-8 at www.irs.gov. |
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BOX J
NOTICE OF GUARANTEED DELIVERY |
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☐ Check here if certificates for tendered Shares are being delivered pursuant to a Notice of Guaranteed Delivery previously sent to the Depositary and complete the following: |
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Name(s) of Registered Owner(s): |
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Date of Execution of Notice of Guaranteed Delivery: |
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Name of Eligible Institution Which Guaranteed Delivery: |
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BOX K
SHAREHOLDER(S) SIGN HERE
(See Instructions
1 and 7)
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Must be duly executed
by registered owner(s) exactly as name(s) appear(s) on certificate(s) or on a security position
listing or by person(s) authorized to become registered owner(s) by certificate(s) and documents
transmitted with this Letter to Transmittal. If signature is by attorney-in-fact, executor,
administrator, trustee, guardian, officer of a corporation or other legal representative
acting in a fiduciary or representative capacity, please set forth the full title.
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Authorized Signature(s) |
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(Shareholder(s) or Legal Representative) |
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(Shareholder(s) or Legal Representative) |
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Name(s) |
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Capacity |
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Address |
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(Include Postal Code or Zip Code) |
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Area Code and Telephone Number |
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TIN; SSN; SIN |
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U.S. Shareholders must provide their Taxpayer Identification
No. or Social Security No. and complete IRS Form W-9; Canadian Shareholders must provide their Social Insurance No. |
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Date |
__________________________________ |
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BOX
L
SIGNATURE GUARANTEE
(See Instructions
1 and 7)
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Authorized Signature |
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(Guarantor) |
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(Name) |
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Title |
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Firm |
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Address |
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(Include Postal Code or Zip Code) |
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Area Code and Telephone Number |
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Email Address |
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Date |
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BOX M
LOST, STOLEN
OR DESTROYED CERTIFICATES
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To be completed
ONLY if certificates representing Shares being tendered have been lost, stolen or destroyed.
The undersigned
has either (check one):
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☐ lost
his, her or its certificate(s) representing Shares; |
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☐ had
his, her or its certificate(s) representing Shares stolen; or |
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☐ had
his, her or its certificate(s) representing Shares destroyed. |
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If a certificate representing Shares has
been lost, stolen or destroyed, this Letter of Transmittal, including this Box M, must be completed as fully as possible and forwarded,
together with a letter describing the loss, theft or destruction and providing a telephone number, to the Depositary. The Depositary
will respond with the replacement requirements. |
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INSTRUCTIONS
Forming Part of the Terms of the Offer
No guarantee of a signature
is required if either:
| (a) | this Letter of Transmittal is signed by the registered holder of the Shares tendered with this Letter
of Transmittal exactly as the name of the registered holder appears on the share certificate or DRS tendered herewith, and payment and
delivery are to be made directly to such registered holder pursuant to the information provided in Box K above; or |
| (b) | such Shares are tendered for the account of a Canadian Schedule I chartered bank, a member of the Securities
Transfer Agents Medallion Program (STAMP), a member of the Stock Exchanges Medallion Program (SEMP) or a member of the New York Stock
Exchange Inc. Medallion Signature Program (MSP) (each such entity, an “Eligible Institution”). Members of these programs
are usually members of a recognized stock exchange in Canada or the United States, members of the Investment Industry Regulatory Organization
of Canada, members of the Financial Industry Regulatory Authority or banks and trust companies in the United States. |
In all other cases, all signatures on this Letter
of Transmittal must be guaranteed by an Eligible Institution by completing Box L – “Signature Guarantee”. See Instruction
7 in this Letter of Transmittal.
| 2. | Delivery of Letter of Transmittal and Certificates; Guaranteed Delivery Procedures. |
Certificates for all physically tendered Shares
together with a properly completed and duly executed Letter of Transmittal, or, in the case of a book-entry transfer, a Book-Entry Confirmation
through the CDSX system (in the case of Shares held in CDS) or an Agent’s Message (in the case of Shares held in DTC), and any other
documents required by this Letter of Transmittal, should be hand delivered, couriered mailed or transmitted by e-mail transmission, as
applicable, to the office of the Depositary at the appropriate address set forth herein and must be received by the Depositary by the
Expiration Date (as defined in the Offer to Purchase). Delivery of this Letter of Transmittal to an address, or e-mail transmission of
this Letter of Transmittal to an e-mail address, other than as set forth above, does not constitute a valid delivery.
Shareholders who wish to tender Shares pursuant
to the Offer and cannot deliver certificates for such Shares or time will not permit all required documents to reach the Depositary by
the Expiration Date, may only tender their Shares by or through any Eligible Institution by properly completing and duly executing and
delivering a Notice of Guaranteed Delivery, substantially in the form provided by the Corporation through the Depositary (indicating the
type of tender and, in the case of an Auction Tender, the price at which Shares are being tendered) to the Depositary, at its office in
Toronto, Ontario as set out in the Notice of Guaranteed Delivery by the Expiration Date and by otherwise complying with the guaranteed
delivery procedure as set forth in the Offer to Purchase under “Procedure for Tendering Shares – Guaranteed Delivery”.
Pursuant to such guaranteed delivery procedure, all tendered Shares (including original share certificates, if such Shares are held in
certificate form) in proper form for transfer, together with a properly completed and duly executed Letter of Transmittal (or a manually
executed photocopy thereof), or in the case of a book-entry transfer, a Book-Entry Confirmation through the CDSX system (in the case of
Shares held by CDS) or an Agent’s Message (in the case of Shares held by DTC), with signatures that are guaranteed if so required
in accordance with this Letter of Transmittal, and any other documents required by this Letter of Transmittal, are received by the Toronto,
Ontario office of the Depositary before 5:00 p.m. (Eastern time) on or before the second trading day on the Toronto Stock Exchange and
The Nasdaq Stock Market after the Expiration Date.
The Notice of Guaranteed Delivery may be hand
delivered, couriered, mailed or transmitted by facsimile transmission to the office of the Depositary at the appropriate address set forth
in the Notice of Guaranteed Delivery, and must include a guarantee by an Eligible Institution in the form set forth in the Notice of Guaranteed
Delivery. For Shares to be validly tendered pursuant to the guarantee delivery procedure, the Depositary must receive the Notice of Guaranteed
Delivery by the Expiration Date.
Notwithstanding any other provision hereof, payment
for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of certificates
for such Shares, a properly completed and duly executed Letter of Transmittal (or a manually executed photocopy thereof) relating to such
Shares, with signatures that are guaranteed if so required, and any other documents required by the Letter of Transmittal, or, in the
case of a book-entry transfer, a Book-Entry Confirmation through the CDSX system (in the case of Shares held in CDS) or an Agent’s
Message (in the case of Shares held in DTC).
The tender information specified in a Notice of
Guaranteed Delivery by a person completing such Notice of Guaranteed Delivery will, in all circumstances, take precedence over the tender
information that is specified in the related Letter of Transmittal that is subsequently tendered.
The method of delivery of certificates representing
Shares and all other required documents is at the option and risk of the tendering Shareholder. If certificates representing Shares are
to be sent by mail, registered mail that is properly insured is recommended and it is suggested that the mailing be made sufficiently
in advance of the Expiration Date to permit delivery to the Depositary on or prior to such date. Delivery of a share certificate representing
Shares will only be made upon actual receipt of the share certificate representing such Shares by the Depositary.
The Corporation will not purchase any fractional
Shares, nor will it accept any alternative, conditional or contingent tenders except as specifically permitted by the Offer to Purchase
and the Circular. All tendering Shareholders, by execution of this Letter of Transmittal (or a manually executed photocopy of it), waive
any right to receive any notice of the acceptance of their tender.
If the space provided in the Box captioned “Description
of Shares Tendered” is inadequate, the certificate numbers and/or the number of Shares should be listed on a separate signed schedule
and attached to this Letter of Transmittal.
| 4. | Partial Tenders and Unpurchased Shares. |
If fewer than all of the Shares evidenced by any
certificate, held through DRS are to be tendered, fill in the number of Shares which are to be tendered in the box entitled “Number
of Shares Tendered”. In such case, if any tendered Shares are purchased pursuant to the Offer, a new certificate or DRS for the
remainder of the Shares evidenced by the old certificate(s) will be issued and sent to the address indicated in Box E, unless otherwise
indicated in Box F on this Letter of Transmittal, promptly after the Expiration Date, or unless certificate(s) for Shares are to be held
for pick-up by checking Box G. All Shares represented by the certificate(s) listed and delivered to the Depositary or noted as held through
DRS are deemed to have been tendered unless otherwise indicated.
| 5. | Indication of Type of Tender; Indication of Price at Which Shares are being Tendered. |
| (a) | To tender Shares, the Shareholder must complete Box A –“Type of Tender” on this Letter
of Transmittal or the Book-Entry Confirmation or Agent’s Message in lieu thereof or, if applicable, on the Notice of Guaranteed
Delivery, indicating whether he, she or it is tendering Shares pursuant to an Auction Tender (Box B) or a Purchase Price Tender (Box C).
Only one box may be checked. If more than one box is checked or if no box is checked, all Shares identified above will be deemed to have
been tendered pursuant to the Purchase Price Tender. The same Shares cannot be tendered, unless previously properly withdrawn as provided
in the Offer to Purchase, pursuant to both an Auction Tender and a Purchase Price Tender or pursuant to Auction Tenders at more than one
price. However, if a Shareholder desires to tender Shares in separate lots at a different type of tender for each lot, such Shareholder
must complete a separate Letter of Transmittal or, if applicable, a Notice of Guaranteed Delivery for each lot which the Shareholder is
tendering. |
| (b) | For Shares to be properly tendered pursuant to an Auction Tender, the Shareholder must complete Box B
– “Auction Tender Price (in Canadian Dollars) per Share at Which Shares Are Being Tendered” on this Letter of Transmittal
indicating the price per Share (in increments of $0.01 per Share) at which such Shares are being tendered. If a Shareholder desires to
tender Shares in separate lots at a different price and/or different type of tender for each lot, such Shareholder must complete a separate
Letter of Transmittal or Book-Entry Confirmation or Agent’s Message in lieu thereof (and, if applicable, a Notice of Guaranteed
Delivery) for each such lot. The same Shares cannot be tendered (unless previously withdrawn as provided in the Offer to Purchase under
“Withdrawal Rights”) pursuant to both an Auction Tender and a Purchase Price Tender, or pursuant to an Auction Tender at more
than one price. No price can be specified by Shareholders making a Purchase Price Tender. |
As described in the Offer to Purchase under “Number
of Shares and Pro-Ration”, if the Corporation is to purchase less than all Shares tendered by the Expiration Date, the Shares purchased
first will consist of all Shares so tendered by any Shareholder who will own beneficially, as of the close of business on the Expiration
Date, an aggregate of fewer than 100 Shares and who tenders all of his, her or its Shares under Auction Tenders at or below the Purchase
Price or under Purchase Price Tenders. This preference will not be available unless Box D – “Odd Lots” is completed.
Furthermore, partial tenders will not qualify for this preference and this preference is not available to a Shareholder who holds separate
certificates for fewer than 100 Shares in different accounts if such Shareholder beneficially owns in the aggregate 100 or more Shares.
| 7. | Signatures on Letter of Transmittal, Stock Power and Endorsements. |
| (a) | If Box K in this Letter of Transmittal is signed by the registered owner(s) of the Shares tendered hereby,
the signature(s) must correspond exactly with the name(s) as written on the face of the certificate without any change whatsoever. |
| (b) | If the Shares are registered in the names of the two or more joint owners, each such owner must sign in
Box K in this Letter of Transmittal. |
| (c) | If any tendered Shares are registered in different names on several certificates, it will be necessary
to complete, sign, and submit as many separate Letters of Transmittal as there are different registrations of certificates. |
| (d) | When this Letter of Transmittal is duly executed by the registered owner(s) of the Shares listed and transmitted
hereby, no endorsements of certificate(s) representing such Shares or separate stock powers are required unless payment is to be made,
or the certificates for Shares not tendered by the undersigned or not purchased by the Corporation, are to be returned or issued to a
person other than the registered owner(s). Any signature(s) required on such certificates or stock powers must be guaranteed by an Eligible
Institution. If this Letter of Transmittal is duly executed by a person other than the registered owner of the certificate(s) listed,
the certificates must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered
owner(s) appear(s) on the certificate, and signatures on such certificate(s) or stock power(s) must be guaranteed by an Eligible Institution.
An ownership declaration, which can be obtained from the Depositary, must also be completed and delivered to the Depositary. See Instruction
1 in this Letter of Transmittal. |
| (e) | If this Letter of Transmittal or any certificates or stock powers are duly executed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or any other legal representative acting in a fiduciary or representative
capacity, such persons should so indicate when signing and must submit proper evidence satisfactory to the Corporation or the Depositary
of their authority to so act. |
| 8. | Payment and Delivery Instruction. |
The signatory of this Letter of Transmittal must
identify to whom a cheque and/or certificates should be issued by completing Box E. Such cheque and/or certificates will be sent to the
address indicated in Box F, unless a cheque evidencing payment for Shares tendered is to be held by the Depositary for pick-up by the
undersigned or any person designated by the undersigned in writing, in which case Box G -“Hold for Pick-Up” on this Letter
of Transmittal must be completed.
All questions as to the number of Shares to be
taken up, the price to be paid therefore, the form of documents and the validity, eligibility (including time of receipt) and acceptance
for payment of any tender of Shares, will be determined by the Corporation, in its sole discretion, acting reasonably, which determination
will be final and binding on all parties, except as otherwise finally determined in a subsequent judicial proceeding or as required by
law. The Corporation reserves the absolute right to reject any or all tenders of Shares determined by it in its sole discretion not to
be in proper form or completed in accordance with the instructions herein and in the Offer or the acceptance for payment of, or payment
for, any tender of Shares which may, in the opinion of the Corporation’s counsel, be unlawful. The Corporation also reserves the
absolute right to waive any of the conditions of the Offer or any defect or irregularity in any tender of any particular Shares. No tender
of Shares will be deemed to be properly made until all defects and irregularities have been cured or waived. None of the Corporation,
the Depositary, the Dealer Managers nor any other person will be obligated to give notice of defects or irregularities in notices of withdrawal,
nor shall any of them incur any liability for failure to give any such notice. The Corporation’s interpretation of the terms and
conditions of the Offer (including this Letter of Transmittal and the Notice of Guaranteed Delivery) will be final and binding, except
as otherwise finally determined in a subsequent judicial proceeding or as required by law.
| 10. | Questions and Requests for Assistance and Additional Copies. |
Questions and requests for assistance may be directed
to the Depositary at the addresses and telephone and facsimile numbers set forth herein or to the Dealer Managers at the addresses and
telephone numbers set forth on the back cover of the Offer to Purchase and the Circular. Additional copies of the Offer to Purchase, the
Circular and this Letter of Transmittal and copies of the Notice of Guaranteed Delivery may be obtained from the Depositary or from your
local broker, dealer, commercial bank, or trust company.
| 11. | Tax Residency – Canadian Withholding Tax. |
Canadian Resident Shareholders
To ensure that non-resident withholding tax is
not withheld in respect of the Purchase Price for tendered Shares beneficially owned by a person who is resident in Canada for purposes
of the Tax Act (or, if a partnership, is a “Canadian partnership” for purposes of the Tax Act) (a “Canadian Resident
Beneficial Owner”), the Shareholder must certify in Section I of Box H that the Canadian Resident Beneficial Owner is resident
in Canada for purposes of the Tax Act (or, if a partnership, is a “Canadian partnership” for the purposes of the Tax Act).
Canadian Resident Beneficial Owners and Shareholders holding tendered Shares on behalf of a Canadian Resident Beneficial Owner are only
required to complete Section I of Box H. Shareholders who do not properly complete the certification in Section I of Box H regarding the
Canadian residency status of a Canadian Resident Beneficial Owner will be assumed to be a non-resident of Canada and subject to a 25%
non-resident withholding tax on any relevant amounts.
Shareholders Not Resident in Canada
Non-resident withholding tax may apply in respect
of the Purchase Price for Shares beneficially owned by a person who is not resident in Canada for purposes of the Tax Act (or, if a partnership,
is not a “Canadian partnership” for purposes of the Tax Act) (a “Non-Resident Beneficial Owner”). Non-Resident
Beneficial Owners and Shareholders holding Shares on behalf of a Non-Resident Beneficial Owner are required to complete Sections I and
II of Box H. Non-resident withholding tax will generally apply at a rate of 25% to certain amounts paid or deemed to be paid (including
a deemed dividend arising under the Offer, if any) in respect of Shares beneficially owned by persons not resident in Canada for purposes
of the Tax Act, unless a tax treaty is applicable to reduce the withholding tax rate.
Non-Resident Beneficial Owners will be subject
to withholding tax at 25% on any deemed dividend unless the information indicated in Section II of Box H is properly completed and provided
along with this Letter of Transmittal. If the Shareholder is the Beneficial Owner of the tendered Shares, the Shareholder must complete
and provide, along with this Letter of Transmittal, CRA Form NR 301 (or, in the case of a partnership or hybrid entity, CRA Form NR 302
or NR 303, as applicable) in order to claim the benefits under a tax treaty.
If the Shareholder is not the Beneficial Owner
of the tendered Shares, the Shareholder must obtain from each Beneficial Owner wishing to claim the benefits under a tax treaty a completed
CRA Form NR 301 (or, in the case of a partnership or hybrid entity, CRA Form NR 302 or NR 303, as applicable), and if there is more than
one Beneficial Owner, the Shareholder must also complete Schedule A.
Shareholders who do not properly complete and
provide, along with this Letter of Transmittal, Form NR 301 (or, in the case of a partnership or hybrid entity, Form NR 302 or NR 303,
as applicable) and Schedule A (if applicable) will be assumed to be subject to 25% non-resident withholding tax rate on any relevant amounts.
The Offer and any agreement resulting from the
acceptance of the Offer will be construed in accordance with and governed by the laws of the Province of Ontario and the federal laws
of Canada applicable therein.
IMPORTANT: This Letter of Transmittal or a
manually signed photocopy of it (together with certificates for Shares and all other required documents), the Notice of Guaranteed Delivery,
where applicable, or, in the case of a book-entry transfer, a Book-Entry Confirmation through the CDSX system (in the case of Shares held
in CDS) or an Agent’s Message (in the case of Shares held in DTC) must be received by the Depositary on or before the Expiration
Date.
PRIVACY NOTICE
TSX Trust Company is committed to protecting your
personal information. In the course of providing services to you and its corporate clients, it receives non-public personal information
about you – from transactions it performs for you, forms you send it, other communications it has with you or your representatives,
etc. This information could include your name, address, social insurance number, securities holdings and other financial information.
It uses this to administer your account, to better serve your and its clients’ needs and for other lawful purposes relating to its
services. It has prepared a Privacy Policy to tell you more about its information practices and how your privacy is protected. It is available
at tsxtrust.com, or by writing the Depositary at 301 – 100 Adelaide St W, Toronto, Ontario, M5H 4H1. TSX Trust Company will use
the information you are providing on this form in order to process your request and will treat your signature(s) on this form as your
consent to the above.
IMPORTANT U.S. TAX INFORMATION FOR U.S. SHAREHOLDERS
For purposes of this Letter of Transmittal, a
“U.S. person” is a beneficial owner of Shares that, for U.S. federal income tax purposes, is (a) an individual who is a citizen
or resident of the United States, (b) a corporation, partnership, or other entity classified as a corporation or partnership for U.S.
federal income tax purposes that is created or organized in or under the laws of the United States, or any political subdivision thereof
or therein, (c) an estate if the income of such estate is subject to U.S. federal income tax regardless of the source of such income,
or (d) a trust if (i) a U.S. court is able to exercise primary supervision over the administration of such trust and one or more U.S.
persons have the authority to control all substantial decisions of such trust, or (ii) such trust has validly elected to be treated as
a U.S. person for U.S. federal income tax purposes.
To avoid backup withholding of U.S. federal income
tax on payments pursuant to the Offer, a U.S. Shareholder depositing Shares who is a U.S. person must, unless an exemption applies, provide
the Depositary with such holder’s correct taxpayer identification number (TIN) or employer identification number (EIN), certify
under penalties of perjury that such TIN or EIN is correct, and provide certain other certifications by completing the IRS Form W-9 included
in this Letter of Transmittal. If such holder is an individual, the TIN is his or her Social Security Number. If a U.S. person does not
provide his, her or its correct TIN or EIN or fails to provide the required certifications, the IRS may impose certain penalties on such
holder, and payments to such holder pursuant to the Offer may be subject to backup withholding at a rate currently equal to 24%. All U.S.
persons tendering Shares pursuant to the Offer should complete and sign the IRS Form W-9 to provide the information and certifications
necessary to avoid backup withholding (unless an applicable exemption exists and is proved in a manner satisfactory to the Depositary).
To the extent that a U.S. Shareholder designates another U.S. Shareholder that is a U.S. person to receive payment, such U.S. person may
be required to provide a properly completed IRS Form W-9.
If a U.S. person has not been issued a TIN or
EIN and has applied for a TIN or EIN or intends to apply for a TIN or EIN in the near future, then the U.S. person should write “Applied
For” in the space for the TIN or EIN in Part I of IRS Form W-9 and should sign and date the form. If the Depositary has not been
provided with a properly certified TIN or EIN by the time of payment, backup withholding will apply. If Shares are held in more than one
name or are not in the name of the actual owner, consult the instructions on the enclosed IRS Form W-9 for guidance on which name and
TIN or EIN to report.
Certain U.S. persons (such as corporations) are
not subject to backup withholding but may be required to provide evidence of their exemption from backup withholding. Exempt U.S. persons
should enter the appropriate exempt payee code on IRS Form W-9. See the enclosed IRS Form W-9 for instructions.
A U.S. Shareholder that is not a U.S. person and
is not acting on behalf of a U.S. person should not complete IRS Form W-9. Instead, to establish an exemption from backup withholding,
such U.S. Shareholder that is not a U.S. person should properly complete and submit an IRS Form W-8BEN, W-8BEN-E, W-8IMY, W-8ECI, or W-8EXP,
as applicable, attesting to such exempt status. An appropriate IRS Form W-8 may be obtained from the Depositary or on the IRS website
(www.irs.gov).
Backup withholding is not an additional tax. Rather,
the amount of any backup withholding collected may be allowed as a refund or credit against the U.S. Shareholder’s U.S. federal
income tax liability, provided that the required information is furnished to the IRS in a timely manner.
ALL U.S. SHAREHOLDERS ARE URGED TO CONSULT
THEIR OWN TAX ADVISORS TO DETERMINE HOW THE FOREGOING BACKUP WITHHOLDING AND REPORTING REQUIREMENTS APPLY TO THEM WITH REGARD TO THEIR
PARTICULAR CIRCUMSTANCES.
SCHEDULE A
TO BE COMPLETED BY A SHAREHOLDER HOLDING SHARES
ON BEHALF OF MORE THAN ONE NON-RESIDENT BENEFICIAL OWNER CLAIMING BENEFITS UNDER A TAX TREATY
| Name of Non-Resident Beneficial Owner |
Number of Tendered
Shares Held |
| |
|
| |
|
| |
|
| |
|
| |
|
| Total |
If you are a Shareholder that holds Shares for
more than one Non-Resident Beneficial Owner that wishes to claim treaty benefits, please provide the name and number of Shares held by
each such Non-Resident Beneficial Owner. The name of each Non-Resident Beneficial Owner should match the name on the corresponding CRA
Form NR 301 - Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person* that you are submitting
with this Letter of Transmittal. Attach an additional schedule if more space is needed.
___________
* Partnerships
or Hybrid Entities must complete CRA Form NR 302 or Form NR 303, as applicable.
A -1
Exhibit (a)(1)(C)
THIS IS NOT A LETTER OF TRANSMITTAL
NOTICE OF GUARANTEED DELIVERY
To Tender Common Shares of
illumin Holdings Inc.
Pursuant to the Offer to Purchase Dated July
27, 2023
| THE OFFER EXPIRES AT 5:00 P.M. (EASTERN TIME) ON AUGUST 30, 2023 UNLESS THE OFFER IS WITHDRAWN EXTENDED OR VARIED (SUCH DATE AND TIME, AS THEY MAY BE EXTENDED, THE “EXPIRATION TIME” AND THE “EXPIRATION DATE”, RESPECTIVELY). |
As set forth in the Offer to Purchase dated July
27, 2023 (the “Offer to Purchase”) and the accompanying issuer bid circular (the “Circular”) of
illumin Holdings Inc. (“illumin” or the “Corporation”), this notice of guaranteed delivery (the
“Notice of Guaranteed Delivery”) hereto must be used to tender common shares (the “Shares”) of the
Corporation pursuant to the Corporation’s offer to purchase up to $40,000,000 in value of Shares at a Purchase Price of not less
than $2.53 and not more than $2.65 per Share if a Shareholder wishes to tender Shares pursuant to the Offer (as defined below) and that
the certificates for these Shares are not immediately available, or the book-entry transfer procedures cannot be completed, prior to the
Expiration Date, or time will not permit all documents required by the Letter of Transmittal (as defined below) to reach TSX Trust Company,
as depositary (the “Depositary”), by the Expiration Date. This Notice of Guaranteed Delivery may be hand delivered,
couriered, mailed or transmitted by facsimile transmission or email to the office of the Depositary set forth below.
| AND TO: | TSX Trust Company, as Depositary |
|
By Mail:
TSX Trust Company
301 – 100 Adelaide St W
Toronto, Ontario
M5H 4H1
Attention: Corporate Actions |
By Hand, Courier or Registered Mail:
TSX Trust Company
301 – 100 Adelaide St W
Toronto, Ontario
M5H 4H1
Email: tsxtis@tmx.com |
TSX TRUST COMPANY
Telephone: 416-342-1091
Toll Free: 1-866-600-5869
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY
TO ANY ADDRESS OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OR EMAIL OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID
DELIVERY.
This Notice of Guaranteed Delivery is not to be
used to guarantee signatures. If a signature on the Letter of Transmittal is required to be guaranteed by an Eligible Institution (as
defined in the Offer), such signature must appear on the applicable space on the Letter of Transmittal.
The terms and conditions of the Offer are incorporated
by reference in this Notice of Guaranteed Delivery. Capitalized terms used and not defined in this Notice of Guaranteed Delivery have
the meanings ascribed to them in the Offer that accompanies this Notice of Guaranteed Delivery.
The undersigned hereby tenders to the Corporation,
upon the terms and subject to the conditions set forth in the Offer to Purchase and the Circular, the related letter of transmittal (the
“Letter of Transmittal”) and this Notice of Guaranteed Delivery (which together constitute the “Offer”),
receipt of which is hereby acknowledged, the number of Shares indicated below pursuant to the guaranteed delivery procedure set forth
in the Offer to Purchase under “Procedure for Tendering Shares”. The undersigned agrees that the tender information
specified in this Notice of Guaranteed Delivery will, in all circumstances, take precedence over the tender information that is specified
in the related Letter of Transmittal that is subsequently deposited.
The undersigned understands and acknowledges that
payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of
certificate(s) for such Shares, a properly completed and duly executed Letter of Transmittal (or a manually executed photocopy thereof)
or, in the case of a book-entry transfer, a Book-Entry Confirmation through the CDSX system (in the case of Shares held in CDS) or an
Agent’s Message (in the case of Shares held in DTC), relating to such Shares, with the signatures guaranteed if required, and all
other documents required by the Letter of Transmittal before 5:00 p.m. (Eastern time) on or before the second trading day on the Toronto
Stock Exchange (the “TSX”) and The Nasdaq Stock Market (“Nasdaq”) after the Expiration Date. The
undersigned also understands and acknowledges that under no circumstances will interest accrue or be paid by the Corporation or the Depositary
to persons tendering Shares regardless of any delay in making payment for any Shares or otherwise, including any delay in making payment
to any person using the guaranteed delivery procedures, and that payment for Shares tendered pursuant to the guaranteed delivery procedures
will be the same as that for Shares delivered to the Depositary on or prior to the Expiration Date, even if the Shares to be delivered
pursuant to the guaranteed delivery procedures set forth under “Procedure for Tendering Shares”, of the Offer to Purchase,
are not so delivered to the Depositary at such date and, therefore, payment by the Depositary on account of such Shares is not made until
after the date the payment for the tendered Shares accepted for payment pursuant to the Offer is to be made by the Corporation.
All authority conferred or agreed to be conferred
by this Notice of Guaranteed Delivery is irrevocable and may be exercised during any subsequent legal incapacity of the undersigned and
shall, to the extent permitted by applicable law, survive the death or incapacity, bankruptcy or insolvency of the undersigned and all
obligations of the undersigned under this Notice of Guaranteed Delivery shall be binding upon the heirs, personal representatives, successors
and assigns of the undersigned.
|
NAME(S) OF REGISTERED OWNER(S)
(Please Fill in Exactly as Name(s) Appear(s) on
Share Certificate(s) or DRS Statement(s))
|
| CONTACT INFORMATION OF REGISTERED OWNER(S) |
| |
|
|
|
| Signature(s) of Registered Owner(s) |
|
|
|
| |
|
|
Address(es) |
| Email Address |
|
|
|
| |
|
|
Postal Code or Zip Code |
| Date |
|
|
|
| |
|
|
Daytime Telephone Number |
| Certificate Number(s) or whether held by DRS |
Name of Shareholder (please print) |
Number of Shares Represented by Certificate(s) or held by DRS |
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| TOTAL |
|
DO NOT SEND SHARE CERTIFICATES WITH THIS FORM
The Eligible Institution which completes this
Notice of Guaranteed Delivery must communicate the guarantee to the Depositary and must deliver (i) the Letter of Transmittal and certificates
for Shares or (ii) in the case of a book-entry transfer, a Book-Entry Confirmation through the CDSX system (in the case of Shares held
in CDS) or an Agent’s Message (in the case of Shares held in DTC), to the Depositary within the time period shown herein. Failure
to do so could result in a financial loss to such Eligible Institution.
GUARANTEE
(Not to be used for signature guarantees)
The undersigned, a Canadian Schedule 1 chartered
bank, a member firm of a recognized stock exchange in Canada or a U.S. financial institution (including most U.S. banks, savings and loan
associations and brokerage houses) which is a participant in the Securities Transfer Agents Medallion Program (STAMP), the New York Stock
Exchange Medallion Signature Program (MSP) or the Stock Exchanges Medallion Program (SEMP) guarantees to deliver to the Depositary, at
its address set forth above, the certificate(s) representing the Shares tendered hereby, in proper form for transfer, with delivery of
a properly completed and duly executed Letter of Transmittal (or manually signed photocopy thereof) or, in the case of a book-entry transfer,
a Book-Entry Confirmation through the CDSX system (in the case of Shares held in CDS) or an Agent’s Message (in the case of Shares
held in DTC), and any other required documents, on or before 5:00 p.m., Eastern time, on or before the second trading day on the TSX and
Nasdaq after the Expiration Date. As used herein, a “Trading Day” means a day on which trading occurs on the TSX and
Nasdaq.
| Name of Firm |
|
Authorized Signature |
|
| Address of Firm: |
|
Name |
|
| |
|
(please type or print) |
| |
Title: |
|
| Postal Code or Zip Code |
|
Dated: |
|
,2023 |
| Area Code and Tel. No |
|
|
|
| |
|
|
|
|
|
|
BOX A
TYPE OF TENDER
|
| Check only one box. If more than one box is checked or if no box is checked, all Shares identified above will be deemed to have been deposited pursuant to the Purchase Price Tender. Shares are being deposited hereby pursuant to: |
| ☐ |
An Auction Tender
(Please complete Box B) |
|
☐ |
A Purchase Price Tender
(Please complete Box C) |
|
BOX B
AUCTION TENDER
PRICE (IN CANADIAN DOLLARS) PER
SHARE AT WHICH SHARES ARE BEING
DEPOSITED
|
|
This box MUST be completed if Shares are being
deposited pursuant to an Auction Tender. Check the appropriate box to indicate the Auction Tender price.
Check only one box. If more than one box is checked
or if no box is checked, all Shares identified above will be deemed to have been deposited pursuant to the Purchase Price Tender.
If portions of shareholdings are being deposited
at different prices, use a separate Letter of Transmittal for each price specified. See Instruction 5 of the Letter of Transmittal. |
| |
| ☐ |
$2.53 |
☐ |
$2.54 |
☐ |
$2.55 |
☐ |
$2.56 |
☐ |
$2.57 |
☐ |
$2.58 |
☐ |
$2.59 |
| ☐ |
$2.60 |
☐ |
$2.61 |
☐ |
$2.62 |
☐ |
$2.63 |
☐ |
$2.64 |
☐ |
$2.65 |
|
|
BOX C
PURCHASE PRICE TENDER
|
| This box MUST be completed if Shares are being deposited pursuant to a Purchase Price Tender. The undersigned either (check one): |
| ☐ |
is depositing Shares beneficially owned by the undersigned; or |
| ☐ |
is a broker, dealer, commercial bank, trust company or other nominee that is depositing, for the beneficial owners thereof, Shares with respect to which it is the owner of record (list attached). |
|
BOX D
ODD LOTS
(See Instruction 6 of the Letter of Transmittal)
|
|
To be completed ONLY if Shares are being deposited
by or on behalf of persons beneficially owning an aggregate of fewer than 100 Shares on the Expiration Date.
The undersigned either (check one): |
| ☐ |
will be the beneficial owner of an aggregate of fewer than 100 Shares on the Expiration Date, all of which are deposited; or |
| ☐ |
is a broker, dealer, commercial bank, trust company or other nominee that: (a) is depositing, for the beneficial owners thereof, Shares with respect to which it is the record owner; and (b) believes, based upon representations made to it by each such beneficial owner, that such beneficial owner will own an aggregate of fewer than 100 Shares on the Expiration Date and is depositing all such Shares. |
Exhibit (d)(2)
AMENDED AND RESTATED STOCK OPTION PLAN
ACUITYADS HOLDINGS INC.
Section
One
DEFINITIONS AND INTERPRETATION
As used herein, unless there is something in the
subject matter or context inconsistent therewith, the following terms shall have the meanings set forth below:
| (a) | “affiliate” has the meaning ascribed thereto in the Securities Act (Ontario). |
| (b) | “Administrator” means, initially, the Chief Financial Officer of the Corporation and thereafter
shall mean such director or other senior officer or employee of the Corporation as may be designated as Administrator by the Board from
time to time. |
| (c) | “Award Date” means the date on which the Board awards a particular Option. |
| (d) | “Board” means the board of directors of the Corporation or any committee thereof to which
the board of directors of the Corporation has delegated the power to administer and grant Options under the Plan. |
| (i) | in the case of an Employee or Officer (1) cause as such term is defined in the written employment agreement
with the Employee or Officer or if there is no written employment agreement or cause is not defined therein, the usual meaning of just
cause under the common law or the laws of the jurisdiction in which the employee is employed; or (2) the termination of employment as
a result of an order made by any Regulatory Authority having jurisdiction to so order; |
| (ii) | in the case of a Consultant (1) the occurrence of any event which, under the written consulting contract
with the Consultant or the common law or the laws of the jurisdiction in which the Consultant provides services, gives the Corporation
or any of its affiliates the right to immediately terminate the consulting contract; or (2) the termination of the consulting contract
as a result of an order made by any Regulatory Authority having jurisdiction to so order; or |
| (iii) | in the case of a Director, ceasing to be a Director as a result of (1) ceasing to be qualified pursuant
to subsection 118(1) of the Business Corporations Act (Ontario); (2) a resolution having been passed under section 122 of the Business
Corporations Act (Ontario) or by the resolution or method specified in the Corporation’s Articles; or (3) an order made by any Regulatory
Authority having jurisdiction to so order. |
| (f) | “Change of Control” means and shall be deemed to have occurred if one of the following events
takes place: |
| (i) | the sale, transfer or other disposition of all or substantially all of the Corporation’s assets
in complete liquidation or dissolution of the Corporation; |
| (ii) | a consolidation, merger, amalgamation, arrangement or other reorganization or acquisition involving the
Corporation or any of its affiliates and another corporation or other entity, as a result of which the holders of Common Shares immediately
prior to the completion of the transaction hold less than 50% of the outstanding voting securities of the successor corporation immediately
after completion of the transaction; |
| (iii) | any Person or combination of Persons at arm’s length to the Corporation and its affiliates acquires
or becomes the beneficial owner of, directly or indirectly, more than 50% of the voting securities of the Corporation, whether through
the acquisition of previously issued and outstanding voting securities, or of voting securities that have not been previously issued,
or any combination thereof, or any other transaction having a similar effect; |
| (iv) | a resolution is adopted to wind-up, dissolve or liquidate the Corporation; or |
| (v) | as a result of or in connection with: (A) a contested election of directors of the Corporation; or (B)
a consolidation, merger, amalgamation, arrangement or other reorganization or acquisition involving the Corporation or any of its affiliates
and another corporation or other entity (a “Transaction”), fewer than 50% of the Corporation’s directors following the
Transaction are persons who were directors of the Corporation immediately prior to such Transaction. |
| (g) | “Common Share” or “Common Shares” means, as the case may be, one or more common
shares in the capital of the Corporation. |
| (h) | “Corporation” means AcuityAds Holdings Inc., a corporation incorporated under the Canada
Business Corporations Act. |
| (i) | “Consultant” has the meaning given to that term: (i) if the Common Shares are listed on the
TSXV, in TSXV Policy 4.4 – Incentive Stock Options; or (ii) otherwise, in National Instrument 45-106 – Prospectus
Exemptions. |
| (j) | “Consultant Corporation” means for an individual consultant, a corporation or partnership
of which the individual is an employee, shareholder or partner. |
| (k) | “Director” means a director of the Corporation, and for purposes of the Plan includes directors
of any Related Entity of the Corporation. |
| (l) | “Discounted Market Price” of the Common Shares for a particular Award Date shall be the Market
Price as of such date less the maximum discount permitted pursuant to the policies of the Exchange. If the Common Shares are not listed
on an Exchange, then the maximum permissible discount shall be 15%. |
| (m) | “Eligible Persons” means Directors, Officers, Employees and Consultants. |
| (i) | an individual who is considered an employee of the Corporation or a Related Entity of the Corporation
under the Income Tax Act; |
| (ii) | an individual who works full-time for the Corporation or a Related Entity of the Corporation providing
services normally provided by an employee and who is subject to the same control and direction by the Corporation or the affiliated entity
of the Corporation over the details and methods of work as an employee of the Corporation or the affiliated entity of the Corporation,
but for whom income tax deductions are not made at source, or |
| (iii) | an individual who works for the Corporation or a Related Entity of the Corporation on a continuing and
regular basis for a minimum amount of time per week providing services normally provided by an employee and who is subject to the same
control and direction by the Corporation or the affiliated entity of the Corporation over the details and methods of work as an employee
of the Corporation or the affiliated entity of the Corporation, but for whom income tax deductions are not made at source. |
| (o) | “Exchange” means the TSXV, or such other stock exchanges, inter-dealer quotation networks
or other organized trading facilities on which the Common Shares may be listed. |
| (p) | “Exercise Notice” means the notice respecting the exercise of an Option, in the form set out
as Schedule “B” hereto, duly executed by the Option Holder. |
| (q) | “Exercise Period” means the period during which a particular Option may be exercised and is
the period from and including the Award Date through to and including the Expiry Date. |
| (r) | “Exercise Price” means the price at which an Option may be exercised as determined in accordance
with paragraph 3.5. |
| (s) | “Expiry Date” means the date determined in accordance with paragraph 3.4 and after which a
particular Option cannot be exercised. |
| (t) | “Expiry Period” has the meaning given to that term under paragraph 3.4(b). |
| (u) | “Fixed Expiry Date” has the meaning given to that term under paragraph 3.4. |
| (v) | “insider” has the meaning given to that term in the Securities Act (Ontario). |
| (w) | “Market Price” of the Common Shares for a particular Award Date shall be the last closing
price of the Common Shares on the Exchange. If the Common Shares are not listed on the Exchange, then the Market Price shall be, subject
to the necessary approvals of the applicable Regulatory Authorities, the fair market value of the Common Shares on the Award Date as determined
by the Board in its discretion. |
| (x) | “Management Corporation Employee” means an individual employed by a Person providing management
services to the Corporation or to a Related Entity of the Corporation, which are required for the ongoing successful operation of the
business enterprise of the Corporation, but excluding a Person engaged in investor relations activities. |
| (y) | “Officer” means an officer of the Corporation or a Management Corporation Employee, and for
the purposes of the Plan includes officers of any Related Entity of the Corporation. |
| (z) | “Option” means an option to acquire Common Shares, awarded to an Eligible Person pursuant
to the Plan. |
| (aa) | “Option Certificate” means the certificate, in the form set out as Schedule “A”
hereto, evidencing an Option. |
| (bb) | “Option Holder” means a Person who holds an unexercised and unexpired Option or, where applicable,
the Personal Representative of such person. |
| (cc) | “Person” means any individual, partnership, limited partnership, joint venture, syndicate,
sole proprietorship, company or corporation with or without share capital, unincorporated association, trust, trustee, executor, administrator
or other legal personal representative, regulatory body or agency, government or governmental agency or entity however designated or constituted. |
| (dd) | “Personal Representative” means: |
| (i) | in the case of a deceased Option Holder, the executor or administrator of the deceased duly appointed
by a court or public authority having jurisdiction to do so; and |
| (ii) | in the case of an Option Holder who for any reason is unable to manage his or her affairs, the person
entitled by law to act on behalf of such Option Holder. |
| (ee) | “Plan” means this stock option plan; |
| (ff) | “Regulatory Authorities” means the Exchange and all securities commissions or similar securities
regulatory bodies having jurisdiction over the Corporation. |
| (gg) | “Related Entity” has the meaning given to that term in National Instrument 45-106 –
Prospectus and Registration Exemptions. |
| (hh) | “Securities Laws” means securities legislation, securities regulations and securities rules,
as amended, and the instruments, forms, notices and policy documents in force from time to time that are applicable to the Corporation. |
| (i) | “Termination Date” means: |
| (ii) | in the case of the Option Holder’s resignation from employment or the termination of the Option
Holder’s consulting contract by the Option Holder, the date that the Option Holder provides notice of such resignation or termination
to the Corporation or any of its affiliates; or |
| (iii) | in the case of the termination of the Option Holder’s employment or consulting contract by the Corporation
or any of its affiliates for any reason (whether such termination is lawful or unlawful) other than death, the date that the Corporation
or any of its affiliates delivers written notice of such lawful or unlawful termination of the Option Holder’s employment or consulting
contract to the Option Holder; or |
| (iv) | in the case of the expiry of a fixed-term employment agreement or consulting contract that is not renewed
or extended, the last day of the term. |
| (ii) | “TSXV” means the TSX Venture Exchange. |
The Plan is established under, and the provisions
of the Plan shall be subject to and interpreted and construed in accordance with, the laws of the Province of Ontario.
The headings used herein are for convenience only and are
not to affect the interpretation of the Plan.
Section
Two
PURPOSE AND PARTICIPATION
The purpose of the Plan is
to provide the Corporation with a share-related mechanism to attract, retain and motivate qualified Directors, Officers, Consultants and
Employees, to reward such of those Directors, Officers, Consultants and Employees as may be awarded Options under the Plan by the Board
from time to time for their contributions toward the long term goals of the Corporation and to enable and encourage such Directors, Officers,
Consultants and Employees to acquire Common Shares as long term investments.
The Board shall, from time
to time and in its sole discretion, determine which of the Eligible Persons, if any, shall be awarded Options. The Board shall only award
an Option to a Consultant, Employee or Management Corporation Employee if the Consultant, Employee or Management Corporation Employee
is a bona fide Consultant, Employee or Management Corporation Employee of the Corporation or an affiliate of the Corporation, and the
Corporation shall make such a representation if required by the Regulatory Authorities. The Board may, in its sole discretion, grant the
majority of the Options to insiders of the Corporation. However, in no case shall:
| (a) | the number of Options awarded in a one-year period to any one Consultant exceed 2% of the issued Common
Shares (calculated at the time of award); |
| (b) | the number of Options awarded in a one-year period to any one individual exceed 5% of the outstanding
Common Shares (calculated at the time of award), unless disinterested shareholder approval has been obtained; |
| (c) | the aggregate number of Options awarded in a one-year period to Persons employed to provide investor relations
services exceed 2% of the issued Common Shares (calculated at the time of award); |
| (d) | the aggregate number of Options awarded to insiders under the Plan and any previously established and
outstanding stock option plans or grants in a one-year period exceed 10% of the issued Common Shares (calculated at the time of award),
unless disinterested shareholder approval has been obtained; or |
| (e) | the aggregate number of Common Shares reserved for issuance to insiders upon the exercise of Options awarded
under the Plan and any previously established and outstanding stock option plans or grants, exceed 10% of the issued Common Shares (calculated
at the time of award), unless disinterested shareholder approval has been obtained. |
Following the award of an Option by the Board,
the Administrator shall notify the Option Holder in writing of the award and shall enclose with such notice the Option Certificate representing
the Option so awarded.
Each Option Holder, concurrently
with the notice of the award of the Option, shall be provided with a copy of the Plan. A copy of any amendment to the Plan shall be promptly
provided by the Administrator to each Option Holder.
The participation of any Eligible
Person in the Plan is entirely voluntary and not obligatory and shall not be interpreted as conferring any rights or privileges, other
than those rights and privileges expressly provided in the Plan. In particular, participation in the Plan does not constitute a condition
of employment, appointment or engagement to provide services by any Eligible Person. Neither the Plan nor any action taken hereunder shall
interfere with the right of the Corporation or a Related Entity of the Corporation to terminate the employment, appointment or provision
of services of an Option Holder at any time. The payment of any sum of money in cash in lieu of notice of termination of employment, appointment
or provision of services shall not be considered as extending the period of employment, appointment or the provision of services for the
purposes of the Plan.
| 2.6 | Rights Prior to Exercise |
An Option Holder shall have
no rights whatsoever as a shareholder in respect of any of the Common Shares such Option Holder may be entitled to purchase on exercise
of an Option (including any right to receive dividends or other distributions therefrom or thereon) other than in respect of Common Shares
in respect of which the Option Holder has exercised the option to purchase hereunder and which the Option Holder has taken up and paid
for.
The Corporation shall have
the power and the right to deduct or withhold, or require an Option Holder to remit to the Corporation, the required amount to satisfy
federal, provincial, state and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable
event arising as a result of the Plan, including the grant or exercise of any Option granted under the Plan. With respect to any required
withholding, the Corporation shall have the irrevocable right to, and the Option Holder consents to, the Corporation setting off any amounts
required to be withheld, in whole or in part, against amounts otherwise owing by the Corporation to the Option Holder (whether arising
pursuant to the Option Holder’s relationship as a Director, Officer, Employee or Consultant of the Corporation or otherwise), or
may make such other arrangements that are satisfactory to the Option Holder and the Corporation. In addition, the Corporation may elect,
in its sole discretion, to satisfy the withholding requirement, in whole or in part, by withholding such number of Common Shares issuable
upon exercise of the Options as it determines are required to be sold by the Corporation, as trustee, to satisfy any withholding obligations
net of selling costs. The Option Holder consents to such sale and grants to the Corporation an irrevocable power of attorney to affect
the sale of such Common Shares issuable upon exercise of the Options and acknowledges and agrees that the Corporation does not accept
responsibility for the price obtained on the sale of such Common Shares issuable upon exercise of the Options.
| 2.8 | Options Granted To Corporations |
Except in relation to Consultant
Corporations, Options may only be granted to an individual or a corporation that is wholly-owned by Eligible Persons. If a corporation
is an Option Holder and the corporation is listed on the TSX Venture Exchange, it must provide the TSX Venture Exchange with a completed
Form 4F – Certification and Undertaking Required from a Corporation Granted an Incentive Stock Option and the corporation
must agree not to effect or permit any transfer of ownership or option of shares of the corporation nor to issue further shares of any
class in the corporation to any other individual or entity as long as the Option remains outstanding, except with the written consent
of the TSX Venture Exchange.
Section
Three
TERMS AND CONDITIONS OF OPTIONS
| 3.1 | Board to Issue Common Shares |
The Common Shares to be issued to Option Holders
upon the exercise of Options shall be authorized and unissued Common Shares the issuance of which shall have been authorized by the Board.
| 3.2 | Number of Common Shares |
The aggregate number of Common
Shares that may be reserved for issuance pursuant to Options shall not exceed 10% of the outstanding Common Shares at the time of the
granting of an Option. If any Option expires or otherwise terminates for any reason without having been exercised in full, the number
of Common Shares in respect of which the option was not exercised shall be available for the purposes of the Plan. Any exercises of Options
will make new grants available under the Plan, effectively resulting in a re-loading of the number of Options available for grant under
the Plan.
Subject to such other terms
or conditions that may be attached to an Option granted hereunder, an Option Holder may exercise any vested portion or portions of an
Option in whole or in part at any time or from time to time during the Exercise Period. Any Option or part thereof not exercised within
the Exercise Period shall terminate and become null, void and of no effect as of 5:00 p.m. local time in Toronto, Ontario on the Expiry
Date.
Subject to subparagraphs (a)
to (e) below, the Expiry Date of an Option shall be the date fixed by the Board at the time the particular Option is awarded (the “Fixed
Expiry Date”), provided that the Expiry Date shall be no later than the date that is 10 years following the Award Date of such Option:
If the Option Holder dies while his or
her Option is outstanding, then unless otherwise provided for in the Option Certificate, the following shall apply. The Expiry Date for
any vested portion or portions of the Option shall be the earlier of the Fixed Expiry Date and the date that is one year after the date
of the Option Holder’s death. The Expiry Date for any unvested portion of the Option shall be the date of the Option Holder’s
death. The right to purchase Common Shares under an Option shall not vest after the date of the Option Holder’s death.
| (b) | Ceasing to be a Director or Officer |
If the Option Holder holds an Option as
a Director or Officer and the Option Holder ceases to be a Director or Officer (other than by reason of death), then the following shall
apply. The Expiry Date for any vested portion or portions of the Option shall be the earlier of the Fixed Expiry Date and the date that
is 90 days after the Option Holder ceases to be a Director and Officer (or, in the case of persons who are Directors and Officers of the
Corporation at the time that the Common Shares are listed on the TSXV only, the date that is one (1) year after the Option Holder ceases
to be a Director and Officer or such longer period as may be permitted under TSXV policies) (the “Expiry Period”). Notwithstanding
the foregoing, if the Option Holder ceases to be a Director or Officer for Cause, the Expiry Date shall be the date that the Option Holder
ceases to be a Director or Officer. The Expiry Date for any unvested portion of the Option shall be the date that the Option Holder ceases
to be a Director or Officer. The right to purchase Common Shares under an Option shall not vest after the date that the Option Holder
ceases to be a Director or Officer.
| (c) | Ceasing to be an Employee or Consultant |
If the Option Holder holds an Option as
an Employee or Consultant and the Option Holder ceases to be an Employee or Consultant (other than by reason of death), then the following
shall apply. The Expiry Date for any vested portion or portions of the Option shall be the earlier of the Fixed Expiry Date and the date
that is 90 days after the Option Holders ceases to be an Employee or Consultant. Notwithstanding the foregoing, if the Option Holder ceases
to be an Employee or Consultant for Cause, the Expiry Date shall be the Termination Date. The Expiry Date for any unvested portion of
the Option shall be the Termination Date. The right to purchase Common Shares under an Option shall not vest after the Termination Date.
For greater certainty, if the Corporation gives an Employee or Consultant working notice of termination of employment or the consulting
contract or payment in lieu of notice or if the Corporation wrongfully or constructively dismisses the Employee or Consultant, no vesting
shall occur during the working notice period or deemed notice period that the Employee or Consultant receives or should have received.
The Expiry Period shall commence on the first day of such working notice period or deemed notice period.
In the event of a Change of Control or
impending Change of Control, the Board may, subject to any necessary prior written approval of the Regulatory Authorities, in its sole
discretion, deal with outstanding Options in the manner it deems fair and reasonable in light of the circumstances. Without limiting the
generality of the foregoing, the Board may, without any action or consent required on the part of any Option Holder:
| (i) | deliver a notice to the Option Holder advising the Option Holder that the unvested portion of the Option
held by the Option Holder, if any, shall immediately vest; |
| (ii) | deliver a notice to an Option Holder advising the Option Holder that the Expiry Date for any vested portion
or portions of the Option shall be the earlier of the Fixed Expiry Date and the day that is 10 days following the date of the notice and
the Expiry Date for any unvested portion of the Option shall be the date of the notice; or |
| (iii) | take such other actions, and combinations of the foregoing actions, as it deems fair and reasonable under
the circumstances. |
If an Option expires during, or within
two business days after the end of, a Black-Out Period, then, notwithstanding any other provision of the Plan, the Option shall expire
ten business days after the Black-Out Period is lifted by the Corporation. For the purposes hereof, a “Black-Out Period” means
that period during which a trading black-out period is imposed by the Corporation, pursuant to its insider trading policies or otherwise,
to restrict trades in the Corporation’s securities by an Option Holder.
The foregoing subparagraphs
(b) and (c) shall only apply once an Option Holder ceases to fall into any of the categories of Eligible Persons. The Board and the Administrator
shall look to which of the definitions of Employee, Director, Officer or Consultant the Option Holder met immediately prior to the Option
Holder ceasing to be an Eligible Person to determine which of subparagraphs (b) or (c) shall apply. If the Option Holder met more than
one definition, then the following shall apply. If the Option Holder was an Employee or Consultant, then the Option Holder shall be deemed
to hold his or her Option as an Employee or Consultant regardless of whether the Option Holder was also a Director or Officer.
The price at which an Option
Holder may purchase a Common Share upon the exercise of an Option shall be as set forth in the Option Certificate issued in respect of
such Option and in any event shall not be less than the Discounted Market Price of the Common Shares as of the Award Date.
Subject to all applicable
Securities Laws and the rules and policies of all applicable Regulatory Authorities, the Board may attach other terms and conditions to
the award of a particular Option, such terms and conditions to be referred to in a schedule attached to the Option Certificate. These
terms and conditions may include, but are not necessarily limited to, providing that an Option or a portion or portions of an Option expire
on a certain date, after certain periods of time or upon the occurrence of certain events other than as provided for herein, provided
that no Option shall expire more than ten years after the Award Date.
Options may not be assigned or transferred, provided
however that the Personal Representative of an Option Holder may, to the extent permitted by paragraph 4.1, exercise the Option within
the Exercise Period.
If:
| (a) | the Common Shares are changed into or exchanged for a different number or kind of Shares of the Corporation
or securities of another corporation, whether through an arrangement, amalgamation or other similar procedure or otherwise, or a share
recapitalization, subdivision or consolidation; |
| (b) | a dividend is declared upon the Common Shares, payable in Common Shares (other than in lieu of dividends
paid in the ordinary course); |
| (c) | the Corporation distributes by way of a dividend, or otherwise, to all or substantially all holders of
Common Shares, property, evidences of indebtedness or Shares or other securities of the Corporation (other than Common Shares) or rights,
options or warrants to acquire Common Shares or securities convertible into or exchangeable for Common Shares or other securities or property
of the Corporation, other than as a dividend in the ordinary course; or |
| (d) | there is any other change that the Board, in its sole discretion, determines equitably requires an adjustment
to be made; |
then, subject to any required action by the shareholders
of the Corporation and any necessary approval of the Regulatory Authorities, any term that the Board determines requires adjustment (including
the number of Common Shares subject to each outstanding Option and the number of Common Shares that have been authorized for issuance
under the Plan but as to which no Options have yet been granted or that have again become available for the purposes of the Plan, the
Exercise Price of each outstanding Option, as well as any other terms that the Board determines require adjustment) shall be adjusted
by the Board in the manner the Board deems appropriate and its determination shall be final, binding and conclusive. Except as the Board
determines, no issuance by the Corporation of Common Shares of any class, or securities convertible into Common Shares of any class, shall
affect, and no adjustment by reason thereof shall be made with respect to, the number or Exercise Price of Common Shares subject to an
Option. No fractional shares shall be issued upon the exercise of an Option and accordingly, if as a result of the adjustment, an Option
Holder would become entitled to a fractional Common Share, such Option Holder shall have the right to purchase only the next lowest whole
number of Common Shares and no payment or other adjustment shall be made with respect to the fractional interest so disregarded.
The Board, subject to the
rules or policies of the Exchange, may determine and impose terms upon which an Option shall become vested and exercisable. Unless otherwise
specified by the Board at the time of the Option award, and subject to such other limits as may be imposed by Exchange rules or policies
from time to time, all Options granted under the Plan shall vest and become exercisable in full upon grant.
Notwithstanding the foregoing,
unless otherwise permitted pursuant to Exchange policies, Options awarded to Consultants performing investor relations activities must
vest in stages over 12 months with no more than one- quarter vesting in any three month period.
| 3.10 | Personal Information Form and Monitoring of Trading |
An Option Holder who becomes
a new insider of the Corporation or who is undertaking investor relations activities must file a Personal Information Form or such other
documents as may be required by the Regulatory Authorities. An Option Holder who performs investor relations activities must comply with
all procedures established by the Board or the Regulatory Authorities to monitor the Option Holder’s trading in the securities of
the Corporation.
Section
Four
EXERCISE OF OPTION
An Option may be exercised
only by the Option Holder or the Personal Representative of the Option Holder. An Option Holder or the Personal Representative of the
Option Holder may exercise the vested portion or portions of an Option in whole or in part at any time or from time to time during the
Exercise Period up to 5:00 p.m. local time in Toronto, Ontario on the Expiry Date by delivering to the Administrator an Exercise Notice,
the applicable Option Certificate and a certified cheque or bank draft payable to the Corporation in an amount equal to the aggregate
Exercise Price of the Common Shares to be purchased pursuant to the exercise of the Option.
| 4.2 | Issue of Share Certificates |
As soon as practicable following
the receipt of the Exercise Notice, the Administrator shall cause to be delivered to the Option Holder a certificate for the Common Shares
purchased by the Option Holder. If the number of Common Shares in respect of which the Option was exercised is less than the number of
Common Shares subject to the Option Certificate surrendered, the Administrator shall forward a new Option Certificate to the Option Holder
concurrently with delivery of the share certificate for the balance of the Common Shares available under the Option.
The Options and the issue
of Common Shares by the Corporation pursuant to the exercise of Options are subject to the terms and conditions of the Plan and compliance
with the rules and policies of all applicable Regulatory Authorities with respect to the granting of such Options and the issuance and
distribution of such Common Shares, and to all applicable Securities Laws. The Option Holder agrees to comply with all such laws, regulations,
rules and policies and agrees to furnish to the Corporation any information, reports or undertakings required to comply with, and to fully
cooperate with, the Corporation in complying with such laws, regulations, rules and policies.
The Board and the Corporation
may take all such measures as they deem appropriate to ensure that the Corporation’s obligations under the withholding provisions
under income tax laws applicable to the Corporation and other provisions of applicable laws are satisfied with respect to the issuance
of Common Shares pursuant to the Plan or the grant or exercise of Options under the Plan. Issuance of Common Shares or delivery of share
certificates for Common Shares purchased pursuant to the Plan may be delayed, at the discretion of the Board, until the Board is satisfied
that the applicable requirements of income tax laws and other applicable laws have been met.
Section
Five
ADMINISTRATION
The Plan shall be administered
by the Board. The Board may make, amend and repeal at any time and from time to time such regulations not inconsistent with the Plan as
it may deem necessary or advisable for the proper administration and operation of the Plan and such regulations shall form part of the
Plan. The Board may delegate to the Administrator or any director, officer or employee of the Corporation such administrative duties and
powers as it may see fit.
The interpretation by the
Board of any of the provisions of the Plan and any determination by it pursuant thereto shall be final and conclusive and shall not be
subject to any dispute by any Option Holder. No member of the Board or any person acting pursuant to authority delegated by it hereunder
shall be liable for any action or determination in connection with the Plan made or taken in good faith and each member of the Board and
each such person shall be entitled to indemnification with respect to any such action or determination in the manner provided for by the
Corporation.
SECTION SIX
AMENDMENT, TERMINATION AND NOTICE
The Board may, subject to
the approval of any regulatory authority whose approval is required and the approval of shareholders where required by such regulatory
authority, amend the Plan or any Option at any time. Without limiting the generality of the foregoing, the Board is specifically authorized
to amend the terms of the Plan or any Option without obtaining the approval of shareholders in the following circumstances, subject to
any limitations that may be prescribed by the rules or policies of the Exchange from time to time:
| (a) | amendments of a “housekeeping” nature including, but not limited to, of a clerical, grammatical
or typographical nature; |
| (b) | to correct any defect, supply any information or reconcile any inconsistency in the Plan in such manner
and to such extent as shall be deemed necessary or advisable to carry out the purposes of the Plan; |
| (c) | a change to the vesting provisions of any Option or the Plan; |
| (d) | amendments to reflect any changes in requirements of any Regulatory Authority to which the Corporation
is subject; |
| (e) | a change to the termination provisions of an Option which does not result in an extension beyond the original
term of the Option; |
| (f) | in the case of any Option, the substitutions and/or adjustments contemplated under section 3.8 of this
Plan; and |
| (g) | a change to the class of Eligible Persons that may participate under the Plan, |
provided that, in the case
of any Option, no such amendment may, without the consent of the Option Holder, materially decrease the rights or benefits accruing to
such Option Holder or materially increase the obligations of such Option Holder. Notwithstanding the foregoing, shareholder approval shall
be required in respect of amendments to:
| (h) | the definition of Eligible Persons hereunder; |
| (i) | the maximum number or percentage of Common Shares (or other securities) issuable under the Plan; |
| (j) | the limitations under the Plan on the number of Options that may be granted to any one Person or any category
of Persons; |
| (k) | the method for determining the exercise price of Options; |
| (l) | the maximum term of Options; |
| (m) | the expiry and termination provisions applicable to Options; |
| (n) | any reduction in the exercise price if the Option Holder is an insider of the Corporation at the time
of the proposed amendment; and |
| (o) | any other provision that is required to be approved by shareholders under applicable law (including, without
limitation, the rules, regulations and policies of the Exchange). |
Where shareholder approval is sought for amendments
under subsection (n) above, the votes attached to Common Shares held directly or indirectly by insiders benefiting from the amendment
will be excluded.
| 6.2 | Amendment Subject to Approval |
If the amendment of an Option
requires regulatory or shareholder approval, such amendment may be made prior to such approvals being given, but no such amended Options
may be exercised unless and until such approvals are given.
The Plan and any amendments hereto are, and the
award of any Option is, subject to all necessary or required approvals of the applicable Regulatory Authorities and shareholders.
The Board may terminate the
Plan at any time provided that such termination shall not alter the terms or conditions of any Option or impair any right of any Option
Holder pursuant to any Option awarded prior to the date of such termination which shall continue to be governed by the provisions of the
Plan.
The Corporation and every
Option awarded hereunder shall be bound by and subject to the terms and conditions of the Plan. By accepting an Option granted hereunder,
the Option Holder has expressly agreed with the Corporation to be bound by the terms and conditions of the Plan.
Any notice or other communication
contemplated under the Plan to be given by the Corporation to an Option Holder shall be given by the Corporation delivering or faxing
the notice to the Option Holder at the last address for the Option Holder in the Corporation’s records. Any such notice shall be
deemed to have been given on the date on which it was delivered, or in the case of fax, the next business day after transmission. An Option
Holder may, at any time, advise the Corporation of a change in the Option Holder’s address or fax number.
APPENDIX “A”
ACUITYADS HOLDINGS INC.
STOCK OPTION PLAN
OPTION CERTIFICATE
This Certificate is issued pursuant to the provisions
of the AcuityAds Holdings Inc.(the “Corporation”) Stock Option Plan (the “Plan”) and evidences that
· is the holder (the “Option Holder”) of an option (the “Option”)
to purchase up to · Common shares (the “Common Shares”) in the capital
stock of the Corporation at a purchase price of $· per Common Share.
Subject to the provisions of the Plan:
the Award Date of the Option is ☐;
the Fixed Expiry Date of the Option is ☐; and
the Expiry Period is ☐.
The vested portion or portions of the Option may
be exercised at any time and from time to time from and including the Award Date through to 5:00 p.m. local time in Toronto, Ontario on
the Expiry Date by delivering to the Administrator of the Plan an Exercise Notice, in the form attached, together with this Certificate
and a certified cheque or bank draft payable to the Corporation in an amount equal to the aggregate of the Exercise Price of the Common
Shares in respect of which the Option is being exercised.
This Certificate and the Option evidenced hereby
is not assignable, transferable or negotiable and is subject to the detailed terms and conditions contained in the Plan, the terms and
conditions of which the Option Holder hereby expressly agrees with the Corporation to be bound by. This Certificate is issued for convenience
only and in the case of any dispute with regard to any matter in respect hereof, the provisions of the Plan and the records of the Corporation
shall prevail.
The Option is also subject to the terms and conditions
contained in the schedules, if any, attached hereto. All terms not otherwise defined in this Certificate shall have the meanings given
to them under the Plan.
Dated this ·
day of ·.
ACUITYADS HOLDINGS INC.
| Per: | | |
|
| | | Administrator, Stock Option Plan |
|
OPTION CERTIFICATE - SCHEDULE
The additional terms and conditions attached to the Option represented
by this Option Certificate are as follows:
ACUITYADS HOLDINGS INC.
Per:
Administrator, Stock Option Plan
APPENDIX “B”
ACUITYADS HOLDINGS INC
STOCK OPTION PLAN
EXERCISE NOTICE
TO: The Administrator, Stock Option Plan
AcuityAds Holdings Inc. (the “Corporation”)
The undersigned hereby irrevocably gives notice, pursuant to the Corporation’s
Stock Option Plan (the “Plan”), of the exercise of the Option to acquire and hereby subscribes for (cross out inapplicable
item):
all of the Common Shares; or
of the Common Shares;
which are the subject of the Option Certificate
attached hereto.
The undersigned tenders herewith a certified cheque
or bank draft (circle one) payable to the Corporation in an amount equal to the aggregate Exercise Price of the aforesaid Common
Shares exercised and directs the Corporation to issue the certificate evidencing said Common Shares in the name of the undersigned to
be mailed to the undersigned at the following address:
By executing this Exercise Notice, the undersigned
hereby confirms that the undersigned has read the Plan and agrees to be bound by the provisions of the Plan. All terms not otherwise defined
in this Exercise Notice shall have the meanings given to them under the Plan or the attached Option Certificate.
DATED the day
of , _____.
| |
|
| |
Signature of Option Holder |
B - 15
Exhibit (d)(3)
SECOND AMENDED AND RESTATED DEFERRED SHARE UNIT
PLAN
ACUITYADS HOLDINGS INC.
ARTICLE
1
INTERPRETATION
The purpose of the AcuityAds
Holdings Inc. Second Amended and Restated Deferred Common Share Unit Plan (the “Plan”) is to promote a greater alignment
of interests between the employees, directors, officers and consultants of AcuityAds Holdings Inc. (the “Corporation”)
and the shareholders of the Corporation.
The following terms used in
this Plan have the meanings set out below:
| (a) | “Applicable Withholding Taxes” means any and all taxes and other source deductions
or other amounts which the Corporation is required by law to withhold from any amounts to be paid under the Plan; |
| (b) | “Beneficiary” means any person designated by a Participant by written instrument filed
with the Corporation to receive any amount payable under the Plan in the event of a Participant’s death or, failing any such effective
designation, the Participant’s estate; |
| (c) | “Blackout Period” means a period when a Participant is prohibited from trading in the
Corporation’s securities pursuant to the Corporation’s written policies then applicable or a notice in writing to a Participant
by a senior officer or Director of the Corporation; |
| (d) | “Board” means the board of directors of the Corporation; |
| (e) | “Business Day” means a day on which there is trading on the Exchange or such other
stock exchange on which the Common Shares are then listed and posted for trading, and if the Common Shares are not so listed, a day that
is not a Saturday or Sunday or a national legal holiday in Canada; |
| (f) | “CCGC Committee” means the Compensation and Corporate Governance Committee of the Board; |
| (g) | “Change of Control” means and shall be deemed to have occurred if one of the following
events takes place: |
| (i) | the sale, transfer or other disposition of all or substantially all of the Corporation’s assets
in complete liquidation or dissolution of the Corporation; |
| (ii) | a consolidation, merger, amalgamation, arrangement or other reorganization or acquisition involving the
Corporation or any of its affiliates and another corporation or other entity, as a result of which the holders of Common Shares immediately
prior to the completion of the transaction hold less than 50% of the outstanding voting securities of the successor corporation immediately
after completion of the transaction; |
| (iii) | any Person or combination of Persons at arm’s length to the Corporation and its affiliates acquires
or becomes the beneficial owner of, directly or indirectly, more than 50% of the voting securities of the Corporation, whether through
the acquisition of previously issued and outstanding voting securities, or of voting securities that have not been previously issued,
or any combination thereof, or any other transaction having a similar effect; |
| (iv) | a resolution is adopted to wind-up, dissolve or liquidate the Corporation; or |
| (v) | as a result of or in connection with: (A) a contested election of directors of the Corporation; or (B)
a consolidation, merger, amalgamation, arrangement or other reorganization or acquisition involving the Corporation or any of its affiliates
and another corporation or other entity (a “Transaction”), fewer than 50% of the Corporation’s directors following
the Transaction are persons who were directors of the Corporation immediately prior to such Transaction; |
| (h) | “Common Share” means a Common Share of the Corporation; |
| (i) | “Consultant” has the meaning given to that term: (i) if the Common Shares are listed
on the TSXV, in TSXV Policy 4.4 – Incentive Stock Options; or (ii) otherwise, in National Instrument 45-106 – Prospectus Exemptions; |
| (j) | “Corporation” has the meaning ascribed to such term in Section 1.1 hereof; |
| (k) | “Director” means a director of the Corporation; |
| (l) | “DSU” means a bookkeeping entry, equivalent to one Common Share, credited to a Participant’s
DSU Account in accordance with the terms and conditions of the Plan; |
| (m) | “DSU Account” has the meaning ascribed thereto in Section 7.2; |
| (n) | “Eligible Person” means a person who is an Employee, Officer, Director or Consultant,
but excludes the Founders; |
| (o) | “Employee” has the meaning given to that term: (i) if the Common Shares are listed
on the TSXV, in TSXV Policy 4.4 – Incentive Stock Options; or (ii) otherwise, in National Instrument 45-106 – Prospectus Exemptions; |
| (p) | “Exchange” means the TSXV, or such other stock exchanges, inter-dealer quotation networks
or other organized trading facilities on which the Common Shares may be listed; |
| (q) | “Event of Termination” means the termination of the employment of a Participant as
an Employee or the cessation of a Participant as a Director, Officer or Consultant, in any of the foregoing circumstances for any reason
whatsoever, but provided that the Participant does not thereafter continue in the capacity of an Employee, Director, Officer, or Consultant.
In the case of a termination of the employment of a Participant with the Corporation, the date of the Event of Termination shall be the
date of the cessation of such Participant’s employment with the Corporation regardless of whether he or she is entitled to notice
of termination or payment at law or under the terms of any employment contract and regardless of whether the termination of employment
was lawful or unlawful. In the case of a cessation of a Participant as a Director or Officer, the date of the Event of Termination shall
be the date that such Participant ceases to serve in such capacity; |
| (r) | “Founders” means Tal Hayek, Joe Ontman, Rachel Kapcan and Nathan Mekuz and any partnership,
association, syndicate, unincorporated organization, trust and/or body corporate over which any of the Founders have direct or indirect
control, and “Founder” means any one of them; |
| (s) | “Insider” means (i) a Director or senior officer of the Corporation; (ii) a Director
or senior officer of a company that is an Insider or subsidiary of the Corporation; (iii) a Person that beneficially owns or controls,
directly or indirectly, voting securities of the Corporation carrying more than 10% of the voting rights attached to all outstanding voting
securities of the Corporation; and (iv) the Corporation itself if it holds any of its own securities; |
| (t) | “Management Corporation Employee” means an individual employed by a Person providing
management services to the Corporation or to a Related Entity of the Corporation, which are required for the ongoing successful operation
of the business enterprise of the Corporation, but excluding a Person engaged in investor relations activities; |
| (u) | “Officer” means an officer of the Corporation or a Management Corporation Employee,
and for the purposes of the Plan includes officers of any Related Entity of the Corporation; |
| (v) | “Option Plan” means the 10% rolling stock option of the Corporation; |
| (w) | “Participant” means an Eligible Person who is granted DSUs under the Plan; |
| (x) | “Person” means, without limitation, an individual, sole proprietorship, partnership,
unincorporated association, unincorporated syndicate, unincorporated organization, trust, body corporate, trustee, executor, administrator,
or other legal representative; |
| (y) | “Plan” has the meaning ascribed to such term in Section 1.1 hereof; |
| (z) | “Redemption Notice” has the meaning ascribed thereto in Section 9.1; |
| (aa) | “Related Entity” has the meaning given to that term in National Instrument 45-106 –
Prospectus and Registration Exemptions; |
| (bb) | “Spouse” means an individual who is either: (i) married to a Participant; or (ii) a
common-law partner (within the meaning of the Income Tax Act (Canada), as amended from time to time) to a Participant; |
| (cc) | “Share Compensation Plan” means the Option Plan, and any other share option, share
option plan, employee share purchase plan or other compensation or incentive mechanism involving the issuance or potential issuance of
Common Shares to directors, officers, employees or consultants of the Corporation (and its affiliates); |
| (dd) | “Shareholder” means a holder of Common Shares; |
| (ee) | “Trading Day” means any date on which the Exchange on which the Common Shares are then
listed is open for the trading of Common Shares; |
| (ff) | “TSXV” means the TSX Venture Exchange; |
| (gg) | “Vested DSUs” means DSUs that, as of such date the Corporation may determine when such
DSUs are granted, have become redeemable. |
ARTICLE
2
CONSTRUCTION AND INTERPRETATION
| 2.1 | The effective date of the Plan is August 18, 2015, as amended and restated as of May 28,
2019. |
| 2.2 | All references in the Plan to currency refer to lawful currency of Canada. The Plan shall
be governed and interpreted in accordance with the laws of Ontario and the federal laws of Canada applicable therein. |
| 2.3 | If any provision of the Plan is determined to be void or unenforceable in whole or in part,
such determination shall not affect the validity or enforcement of any other provision thereof. |
| 2.4 | In the Plan, references to the masculine shall include the feminine, and references to the
singular shall include the plural and vice versa, as the context requires. |
| 2.5 | Headings wherever used herein are for reference purposes only and do not limit or extend
the meaning of the provisions herein contained. |
ARTICLE
3
GENERAL
| 3.1 | The Plan shall be administered by the CCGC Committee. |
| 3.2 | The CCGC Committee is authorized, subject to the provisions of the Plan, to establish such
rules and regulations as it deems necessary for the proper administration of the Plan, and to make such determinations and take such
other actions in connection with or in relation to the Plan as it deems necessary or advisable. Each determination or action made or
taken pursuant to the Plan, including interpretation of the Plan, shall be final and conclusive for all purposes and binding on all parties,
provided that, notwithstanding any determination or action made or taken by the CCGC Committee, the Board has the authority to make all
determinations and take all other actions in connection with or in relation to the Plan as it may deem necessary or advisable. |
| 3.3 | The Corporation shall be responsible for all costs relating to the administration of the
Plan. |
| 3.4 | The Plan shall remain an unfunded obligation of the Corporation and the rights of Participants
under the Plan shall be general unsecured obligations of the Corporation. |
| 3.5 | The Corporation may deduct from any amount to be paid under the Plan any Applicable Withholding
Taxes in such manner as the Corporation determines, including the sale, on behalf of a Participant, of such number of Common Shares otherwise
deliverable to the Participant as will produce an amount sufficient to pay Applicable Withholding Taxes. |
ARTICLE
4
ELIGIBILITY
| 4.1 | Every Eligible Person who is granted a DSU pursuant to this Plan is a Participant. |
| 4.2 | A person ceases to be eligible to receive grants of DSUs at such time as such person ceases
to be an Eligible Person for any reason. |
| 4.3 | Nothing herein contained shall be deemed to give any person the right to be retained, appointed,
nominated or elected as a Director or Officer or hired as an Employee or Consultant. |
ARTICLE
5
DSU GRANTS
| 5.1 | The CCGC Committee may grant DSUs under this Plan at such time and in such amounts as it
may determine; provided that no DSUs may be granted under this Plan after April 24, 2019 to any Person who was an Officer on such date
or to any Person who is a Director (for greater certainty, this clause shall not affect any DSUs granted to such Persons prior to April
24, 2019). |
| 5.2 | All DSUs credited under the Plan shall remain in DSU Accounts and shall be settled or forfeited,
as applicable, only in accordance with the terms of the Plan. A Participant shall be credited with the DSUs allotted to that Participant
pursuant this Plan on the day so designated by the Board. |
| 5.3 | Whenever cash dividends or distributions are paid on the Common Shares, additional DSUs will
be credited to the Participant’s DSU Account. The number of such additional DSUs will be calculated by multiplying the per Common
Share dividend rate by the number of DSUs held at that time in the Participant’s DSU Account. |
| 5.4 | Any vesting conditions (which may include time restrictions, performance conditions or a
combination of both) for DSUs shall be determined by the CCGC Committee in advance of any grants pursuant to this Plan. Notwithstanding
any other provision of this Plan, the Board may in its sole and absolute discretion accelerate and/or waive any vesting or other conditions
for all or any DSUs for any Participant at any time and from time to time. |
| 5.5 | The Corporation shall keep or cause to be kept such records and accounts as may be necessary
or appropriate in connection with the administration of the Plan. At such times as the Corporation shall determine, the Corporation shall
furnish the Participant with a statement setting forth the details of the DSUs credited to each Participant in his or her DSU Account.
Such statement shall be deemed to have been accepted by the Participant as correct unless written notice to the contrary is given to
the Corporation within 30 days after such statement is given to the Participant. Participants shall not be entitled to receive any certificate
evidencing DSUs. |
ARTICLE
6
DEFERRED UNITS
| 6.1 | Subject to Article 9, under no circumstances shall DSUs be considered Common Shares or entitle
a Participant to any Shareholder rights, including, without limitation, voting rights, distribution entitlements or rights on liquidation. |
| 6.2 | One DSU shall be equivalent in value to one Common Share. Fractional DSUs are permitted up
to two decimal places, but shall be rounded down to the nearest whole number of Common Shares at the time of settlement. |
ARTICLE
7
DEFERRED UNIT ACCOUNTS
| 7.1 | The number of DSUs (including fractional DSUs) to be credited to a Participant as of any particular date
pursuant to this Plan will be determined by the CCGC Committee. |
| 7.2 | An account, to be known as a “DSU Account”, shall be maintained by the
Corporation for each Participant and will show the DSUs credited to a Participant from time to time |
ARTICLE
8
ADJUSTMENTS
| 8.1 | If the number of outstanding Common Shares shall be increased or decreased as a result of a stock split,
consolidation or recapitalization and not as a result of the issuance of Common Shares for additional consideration or by way of stock
dividend, the Board may make appropriate adjustments to the number of DSUs credited to a Participant. Any determinations by the Board
as to the required adjustments shall be made in its sole and absolute discretion and all such adjustments shall be conclusive and binding
for all purposes under the Plan. |
ARTICLE
9
SETTLEMENT OF DEFERRED UNITS
| 9.1 | Vested DSUs shall be redeemed in whole or in part for Common Shares issued from treasury
on the date (the “Redemption Date”) on which the Participant delivers a written notice of redemption in the form of
Schedule A hereto (a “Redemption Notice”) to the Corporation. |
| 9.2 | If a Participant dies, the value of the Vested DSUs credited to that Participant’s DSU Account shall
be payable by the issuance of Common Shares to his or her Beneficiary on the Redemption Date. |
| 9.3 | In the event Vested DSUs are redeemed for Common Shares pursuant to this Article 9, subject to the provisions
of the Plan, the Participant (or, where a Participant had died, his or her Beneficiary) shall receive a whole number of Common Shares
from the Corporation equal to the whole number of DSUs then being redeemed from the Participant’s DSU Account. Such Common Shares
shall be delivered within five Trading Days following the applicable Redemption Date. No fractional Common Shares shall be issued pursuant
to this Plan and a fractional DSU shall be rounded down to the nearest whole DSU and shall not be entitled to a Common Share or any cash
payment on a redemption. |
| 9.4 | Upon the occurrence of a Change of Control, all of a Participant’s unvested DSUs will
automatically become Vested DSUs on the date such Change of Control occurs and all of such Participant’s Vested DSUs will be redeemed
in accordance with this Article 9 in a manner that allows the Participant to participate in such Change of Control only if it is completed
prior to the date of an Event of Termination (if any), as determined by the Board in its sole discretion. |
| 9.5 | Upon the occurrence of an Event of Termination, all of such Participant’s unvested
DSUs will automatically terminate on the date of such Event of Termination, at which time all of such Participant’s Vested DSUs
must be redeemed in accordance with this Article 9 within 90 days following the date such Event of Termination occurs, at which time
any Vested DSUs which have not been redeemed will be cancelled. |
| 9.6 | Notwithstanding Sections 9.1 to 9.5 above, upon an Event of Termination, a Participant shall
file a duly-completed Redemption Notice within 90 days of such Event of Termination. In the event a Participant fails to file a duly-completed
Redemption Notice prior to the day that is 90 days after such Event of Termination, the applicable Vested DSUs shall automatically be
redeemed for Common Shares in accordance with the provisions of this Article 9 and the Redemption Date shall be deemed to be such 90th
day. |
| 9.7 | Notwithstanding the provisions of Sections 9.4 to 9.6 above, the Corporation may, in its sole and absolute
discretion, at any time prior to or following any Event of Termination or Change of Control, permit the vesting and/or redemption of any
or all DSUs held by a Participant in the manner and on the terms authorized by the Corporation, provided that, subject to an extension
pursuant to Section 9.8, the Board will not, in any case, authorize the vesting and/or redemption of DSUs pursuant to this section beyond
a period of one year from the date on which an Event of Termination occurs. |
| 9.8 | Notwithstanding the foregoing, if the applicable Redemption Date for DSUs held by any Participant
occurs during or within ten Business Days of the expiration of a Blackout Period applicable to such Participant, then the Redemption
Date for such DSUs shall be extended to the close of business on the tenth Business Day following the expiration of the Blackout Period. |
| 9.9 | Upon issuance of Common Shares in settlement of any DSUs, such DSUs shall be cancelled. |
ARTICLE
10
NUMBER OF UNITS
| 10.1 | The maximum number of Common Shares reserved for issuance under the Plan at any time shall be 4,156,356.
Unless requisite shareholder approval has been obtained pursuant to the rules of the Exchange (or unless permitted otherwise by the rules
of the Exchange): (i) the maximum number of Common Shares issuable to Insiders under the Plan and other Share Compensation Plans, at any
time, shall not exceed 10% of the issued Common Shares; (ii) the maximum number of DSUs that may be granted to Insiders under the Plan
and other Share Compensation Plans, within a 12-month period, shall not exceed 10% of the issued Common Shares calculated on the grant
date of a DSU granted to any Insider; (iii) the maximum number of DSUs which may be granted to any one person under the Plan and other
Share Compensation Plans, in any 12-month period, shall not exceed 5% of the issued Common Shares calculated on the grant date of a DSU
granted to such person; and (iv) the maximum number of DSUs which may be granted to a Consultant under the Plan and other Share Compensation
Plans, in any 12-month period, shall not exceed 2% of the issued Common Shares calculated on the grant date of a DSU to such Consultant. |
ARTICLE
11
AMENDMENTS TO THE PLAN
| 11.1 | Subject to Section 11.2 and applicable law (including, without limitation, the rules, regulations and
policies of the Exchange), the provisions of the Plan may be amended at any time and from time to time by resolution of the Board. Such
amendments to the Plan include, without limitation: |
| (a) | minor changes of a “house-keeping nature”, including, without limitation, any amendment
for the purpose of curing any ambiguity, error or omission in the Plan, or to correct or supplement any provision of the Plan that is
inconsistent with any other provision of the Plan; |
| (b) | amending DSUs under the Plan, including with respect to either advancing the date on which any DSU may
be redeemed for Common Shares, assignability and the effect of termination of a Participant, provided that such amendment does not adversely
alter or impair any DSU previously granted to a Participant without the consent of such Participant; |
| (c) | amendments necessary to comply with the provisions of applicable law or the applicable rules of the Exchange
on which the Common Shares are then listed, including with respect to the treatment of DSUs granted under the Plan; |
| (d) | amendments respecting the administration of the Plan; |
| (e) | amendments necessary to suspend or terminate the Plan; provided that such amendment does not adversely
alter or impair any DSU previously granted to a Participant without the consent of such Participant; and |
| (f) | any other amendment, fundamental or otherwise, not requiring shareholder approval under applicable laws
or the applicable rules of the Exchange. |
| 11.2 | Approval of shareholders will not be required for amendments to the Plan or amendments to
the terms and conditions of DSUs issued or rights or interests acquired hereunder, except for the following types of amendments or modifications: |
| (a) | amendments to Article 10 hereof to increase the number of Common Shares reserved for issuance, including
an increase in the fixed maximum number of Common Shares, or a change from a fixed maximum number of Common Shares to a fixed maximum
percentage of Common Shares; |
| (b) | amendments for the purpose of extending eligibility to participate in the Plan to Persons who are not
Eligible Persons as defined herein; |
| (c) | amendments for the purpose of permitting DSUs issued or other rights or interests acquired hereunder to
be transferred or assigned other than in accordance with Article 13 hereof; |
| (d) | amendments to Article 10 hereof to increase the insider participation limits; |
| (e) | amendments to this Article 11; and |
| (f) | amendments required to be approved by holders of Common Shares under applicable law (including, without
limitation, the rules, regulations and policies of the Exchange). |
ARTICLE
12
SUSPENSION AND TERMINATION
| 12.1 | The Board may, in its sole discretion and without the consent of any Participant (acting
in his or her capacity as a Participant in the Plan), suspend or terminate the Plan or any provision hereof at any time by giving written
notice thereof to each Participant, provided, however that such suspension or termination may not materially adversely affect the rights
already accrued under the Plan by a Participant, without the consent of the Participant. |
| 12.2 | Following termination of the Plan, DSUs previously credited to Participants shall remain
outstanding and in effect and be settled subject to and in accordance with the applicable terms and conditions of the Plan in effect
immediately prior to the termination. |
ARTICLE
13
ASSIGNMENT
| 13.1 | The interest of any Participant under the Plan or in any DSU shall not be transferable or
alienable by him or her either by pledge, assignment or in any other manner whatsoever and, during his or her lifetime, shall be vested
only in him or her, but shall thereafter enure to the benefit of and be binding upon the Participant’s Beneficiary. |
| 13.2 | Rights and obligations under the Plan may be assigned by the Corporation to a successor of
the business of the Corporation. |
ARTICLE
14
GENERAL
| 14.1 | Neither the establishment of the Plan, the crediting of DSUs or the setting aside of any
funds by the Corporation (if, in its sole and absolute discretion, it chooses to do so) shall be deemed to create a trust. Legal and
equitable title to any funds set aside for the purposes of the Plan shall remain in the Corporation and no Participant shall have any
security or other interest in such funds. Any funds so set aside shall remain subject to the claims of creditors of the Corporation present
or future. Amounts payable to any Participant under the Plan shall be a general, unsecured obligation of the Corporation. The right of
the Participant or Beneficiary to receive payment pursuant to the Plan shall be no greater than the right of other unsecured creditors
of the Corporation. |
| 14.2 | The administration of the Plan shall be subject to and performed in conformity with all applicable
laws, regulations, orders of governmental or regulatory authorities and the requirements of the Exchange. |
| 14.3 | A Participant shall be solely responsible for all federal, provincial, state and local taxes resulting
from his or her receipt of DSUs, Common Shares or other property pursuant to this Plan, except to the extent that the Corporation has,
directly or indirectly, withheld (a) cash for remittance to the statutory authorities and/or (b) Common Shares having a value equal to
the cash to be remitted to the statutory authorities for sale on the Participant’s behalf. In this regard, the Corporation shall
be able to deduct from any payments hereunder (whether in the form of Common Shares or cash) or from any other remuneration otherwise
payable to a Participant any taxes that are required to be withheld and remitted. Each Participant agrees to indemnify and save the Corporation
harmless from any and all amounts payable or incurred by the Corporation or any affiliate of the Corporation if it is subsequently determined
that any greater amount should have been withheld in respect of taxes or any other statutory withholding. |
ARTICLE
15
LANGUAGE
| 15.1 | Les Participants et la Fiducie ont exigé que le present Régime ainsi que tous les documents
et avis qui s’y rattachent et/ou qui en découleront soient redigés en anglais. The Participants and the Corporation
have required that this Plan and all documents and notices resulting herefrom be drawn up in English. |
SCHEDULE A
ACUITYADS HOLDINGS INC.
DEFERRED SHARE UNIT PLAN (THE “PLAN”)
REDEMPTION NOTICE
All capitalized terms used herein but not otherwise
defined shall have the meanings ascribed to them in the Plan.
I hereby advise AcuityAds Holdings Inc. (the “Corporation”)
that I wish to redeem _____________ of the DSUs credited to my account under the Plan in accordance with the terms of the Plan. I acknowledge
and agree that the redemption of my DSUs shall be in accordance with the terms of the Plan.
| Date: |
|
|
|
| |
|
|
(Name of Participant) |
| |
|
|
|
| |
|
|
|
| |
|
|
(Name of Participant) |
| Note: | If the Redemption Notice is signed by a beneficiary or legal representative, documents providing the authority
of such signature should accompany this notice. |
C-12
Exhibit 107
Calculation of Filing Fee Tables
SC TO-I
(Form Type)
illumin Holdings Inc.
(Exact name of registrant as specified in its charter)
Table 1 – Transaction Valuation
| |
|
|
|
|
|
|
| |
|
|
|
| |
Transaction
Valuation |
|
Fee
Rate |
Amount of
Filing Fee |
| |
|
|
|
| Fees to Be Paid |
|
$30,264,053.90(1)(2) |
|
$110.20 per $1,000,000 |
|
$3,335.10 |
| Fees Previously Paid |
|
|
|
|
|
— |
| Total Transaction Valuation |
|
$30,264,053.90 |
|
|
|
|
| Total Fees Due for Filing |
|
|
|
|
|
$3,335.10 |
| Total Fees Previously Paid |
|
|
|
|
|
— |
| Total Fee Offsets |
|
|
|
|
|
— |
| Net Fee Due |
|
|
|
|
|
$3,335.10 |
| (1) |
Calculated solely for purposes of determining the amount of the filing fee. This amount is based upon the offer to purchase for not more than US$30,264,053.90 an aggregate of up to 15,810,276 common shares of illumin Holdings Inc. at a purchase price of not more than US$2.01 and not less than US$1.92 per share in cash. |
| (2) |
The U.S. dollar equivalent of the maximum aggregate offering price has been calculated using an exchange rate of 1.3217 as of July 21, 2023, as announced by the Federal Reserve Board on July 24, 2023. |
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