Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
or
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 001-13425
RB Global, Inc.
(Exact Name of Registrant as Specified in its Charter)
Canada
98-0626225
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
Two Westbrook Corporate Center, Suite 500,
Westchester, Illinois, USA 60154
(708) 492-7000
(Address of Principal Executive Offices and Zip Code)
(Registrant’s Telephone Number, including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class
Trading Symbol
Name of Exchange on Which Registered
Common Shares
RBA
New York Stock Exchange
Common Share Purchase Rights
N/A
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: Restricted Share Units
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No þ
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
þ No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§
232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth
company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.:
Large accelerated filer þ
Accelerated filer o
Non-accelerated filer o
Smaller reporting company o
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. þ
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the
correction of an error to previously issued financial statements. o
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the
registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b). o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ
At June 30, 2024 (the last business day of the registrant’s most recently completed second fiscal quarter), the aggregate market value of the registrant’s common shares held
by non-affiliates of the registrant (assuming for these purposes, but without conceding, that all executive officers and directors are "affiliates" of the registrant) was
approximately $14,038,147,940. The number of common shares of the registrant outstanding as of January 31, 2025, was 184,748,861.
Table of Contents
Documents Incorporated by Reference
Certain portions of the registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission (“SEC”) pursuant to Regulation 14A
not later than 120 days after the registrant’s fiscal year ended December 31, 2024, in connection with the registrant’s 2025 Annual and Special Meeting of
Shareholders, are incorporated herein by reference into Part III of this Annual Report on Form 10-K.
Table of Contents
RB GLOBAL, INC.
FORM 10-K
For the year ended December 31, 2024
INDEX
Cautionary Note Regarding Forward-Looking Statements
1
Summary of Risk Factors
2
PART I
ITEM 1:
Business
4
ITEM 1A:
Risk Factors
13
ITEM 1B:
Unresolved Staff Comments
28
ITEM 1C:
Cybersecurity
28
ITEM 2:
Properties
30
ITEM 3:
Legal Proceedings
30
ITEM 4:
Mine Safety Disclosures
30
PART II
ITEM 5:
Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities
31
ITEM 6:
[Reserved]
34
ITEM 7:
Management’s Discussion and Analysis of Financial Condition and Results of Operations
35
ITEM 7A:
Quantitative and Qualitative Disclosures About Market Risk
51
ITEM 8:
Financial Statements and Supplementary Data
52
Report of Independent Registered Public Accounting Firm (PCAOB ID: 42)
52
Report of Independent Registered Public Accounting Firm (PCAOB ID: 1263)
55
Consolidated Income Statements
55
Consolidated Statements of Comprehensive Income
56
Consolidated Balance Sheets
57
Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity
58
Consolidated Statements of Cash Flows
60
Notes to the Consolidated Financial Statements
61
ITEM 9:
Changes In and Disagreements With Accountants on Accounting and Financial Disclosure
96
ITEM 9A:
Controls and Procedures
96
ITEM 9B:
Other Information
97
ITEM 9C:
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
98
PART III
ITEM 10:
Directors, Executive Officers and Corporate Governance
98
ITEM 11:
Executive Compensation
98
ITEM 12:
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
98
ITEM 13:
Certain Relationships and Related Transactions, and Director Independence
98
ITEM 14:
Principal Accountant Fees and Services
98
PART IV
ITEM 15:
Exhibit and Financial Statement Schedules
98
ITEM 16:
Form 10-K Summary
102
SIGNATURES
Table of Contents
Cautionary Note Regarding Forward-Looking Statements
The information discussed in this Annual Report on Form 10-K of RB Global, Inc. (referred to herein as “RB Global”, the “Company”, “we”, or “us”) includes
“forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section 21E of the Securities
Exchange Act of 1934 (the “Exchange Act”) and Canadian securities laws. Forward-looking statements are typically identified by such words as “aim”,
“anticipate”, “believe”, “could”, “continue”, “estimate”, “expect”, “intend”, “may”, “ongoing”, “plan”, “potential”, “predict”, “will”, “should”, “would”,
“could”, “likely”, “generally”, “future”, “long-term”, or the negative of these terms, and similar expressions intended to identify forward-looking statements.
Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties that may cause actual results to differ
materially. These statements are based on our current expectations and estimates about our business and markets, and may include, among others, statements
relating to:
•
our future strategy, objectives, targets, projections and performance;
•
our ability to drive shareholder value;
•
potential growth and market opportunities;
•
the level of participation in our auctions and the success of our online marketplaces;
•
our ability to grow our businesses, acquire new customers, enhance our sector reach, drive geographic depth, and scale our operations;
•
the impact of our initiatives, services, investments, and acquisitions on us and our customers;
•
the acquisition or disposition of properties;
•
potential future mergers and acquisitions;
•
our ability to integrate acquisitions;
•
our future capital expenditures and returns on those expenditures;
•
our ability to add new business and information solutions, including, among others, our ability to maximize and integrate technology to enhance our
existing services and support additional value-added service offerings;
•
the supply trend of equipment and vehicles in the market and the anticipated price environment, as well as the resulting effect on our business and Gross
Transaction Value (“GTV”);
•
our compliance with laws, rules, regulations, and requirements that affect our business;
•
effects of various economic, financial, industry, and market conditions or policies, including inflation, the supply and demand for property, equipment, or
natural resources;
•
the behavior of commercial assets and vehicle pricing;
•
the relative percentage of GTV represented by straight commission or underwritten (guarantee and inventory) contracts, and its impact on revenues and
profitability;
•
our future capital expenditures and returns on those expenditures;
•
the effect of any currency exchange and interest rate fluctuations on our results of operations;
•
the effect of any tariffs on our results of operations;
•
the grant and satisfaction of equity awards pursuant to our compensation plans;
•
any future declaration and payment of dividends, including the tax treatment of any such dividends;
•
financing available to us from our credit facilities or other sources, our ability to refinance borrowings, and the sufficiency of our working capital to meet
our financial needs; and
•
our ability to satisfy our present operating requirements and fund future growth through existing working capital, credit facilities and debt.
While we have not described all potential risks related to our business and owning our common shares, the factors discussed in “Part I, Item 1A: Risk Factors”
of this Annual Report on Form 10-K for the year ended December 31, 2024 are among those that may affect our performance materially or could cause our
actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements. Except as required by
applicable securities law and regulations of relevant securities exchanges, we do not intend to update publicly any forward-looking statements, even if our
expectations have been affected by new information, future events or other developments. You should consider our forward-looking statements in light of the
factors listed or referenced under “Risk Factors” herein.
RB Global, Inc.
1
Table of Contents
SUMMARY OF RISK FACTORS
The following is a summary of the principal risks described below in “Part I, Item 1A: Risk Factors” in this Annual Report on Form 10-K. We believe that the
risks described in the “Risk Factors” section are material to investors, but other factors not presently known to us or that we currently believe are immaterial
may also adversely affect us. The following summary should not be considered an exhaustive summary of the material risks facing us, and it should be read in
conjunction with the “Risk Factors” section and the other information contained in this Annual Report on Form 10-K:
Risks Related to Our Business
•
Our business and operating results would be adversely affected due to the loss of one or more significant suppliers, a reduction in significant volume from
suppliers, an adverse change in our supplier relationships, or a disruption to our supply of damaged, total loss and low-value vehicles.
•
Our business and operating results would be adversely affected if we are unable to meet or exceed our buyer customers’ demand and expectations or due to
a disruption in demand of damaged, total loss and low-value vehicles.
•
Our market position and competitive advantage could be threatened by our competitors and/or disruptive new entrants.
•
If our facilities lack the capacity to accept additional vehicles, then our relationships with insurance companies or other vehicle suppliers could be
adversely affected.
•
We may be unable to keep existing facilities or open new facilities in desirable locations and on favorable terms, which could materially and adversely
affect our results of operations.
•
Macroeconomic factors, including high fuel prices, high labor costs, inflation and changes in used car prices, may have an adverse effect on our revenues
and operating results.
•
Reliance on our subhaulers and trucking fleet operations could materially and adversely affect our business and reputation.
•
Weather-related and other events beyond our control may adversely impact operations.
•
An increase in the number of damaged and total loss vehicles we purchase could adversely affect our profitability.
•
A significant change in used-vehicle prices could impact the proceeds and revenue from the sale of damaged and total loss vehicles.
•
IAA assumes the settlement risk for vehicles sold through its marketplaces.
•
Changes in laws affecting the import and export of damaged and total loss vehicles may have an adverse effect on our business and financial condition.
•
We are subject to potential liabilities with respect to IAA’s prior separation from KAR Auction Services, Inc.
•
We may not realize the anticipated benefits of, and synergies from, acquisitions and may become responsible for certain liabilities and integration costs as
a result.
•
Damage to our reputation could harm our business.
•
We may incur losses as a result of our guarantee and inventory contracts and advances to consignors.
•
The availability and performance of our information technology ("IT") systems and infrastructure is critical to our business and continued growth.
•
Consumer behavior is rapidly changing, and if we are unable to successfully adapt to consumer preferences and develop and maintain a relevant and
reliable inventory management and multichannel disposition experience for our customers, our financial performance and brand image could be adversely
affected.
•
We rely on data provided by third parties, the loss of which could limit the functionality of certain of our platforms and disrupt our business.
•
Government regulation of the digital landscape is evolving, and unfavorable regulations could substantially harm our business and results of operations.
•
If our ability, or the ability of our third party service partners, cloud computing providers or third party data center hosting facilities, to safeguard the
reliability, integrity and confidentiality of our and their IT systems is compromised, if unauthorized access is obtained to our systems or customers’,
suppliers', counterparties' and employees' confidential information, or if authorized access is blocked or disabled, we may incur material reputational harm,
legal exposure, or a negative financial impact.
•
Our future expenses may increase significantly and our operations and ability to expand may be limited as a result of licenses, laws and regulations
governing auction sites, environmental protection, international trade, tariffs and other matters.
•
Losing the services of one or more key personnel or the failure to attract, train and retain personnel could materially affect our business.
•
Failure to maintain safe sites could materially affect our business and reputation.
•
Income and commodity tax amounts, including tax expense, may be materially different than expected, and there is a trend by global tax collection
authorities towards the adoption of more aggressive laws, regulations, interpretations and audit practices.
•
Our substantial international operations expose us to additional risks that could harm our business, including foreign exchange rate fluctuations that could
harm our results of operations.
•
Our business operations may be subject to a number of federal and local laws, rules and regulations governing international trade, including export control
regulations.
RB Global, Inc.
2
Table of Contents
•
Failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws, including the U.S. Foreign Corrupt Practices Act of 1977, as
amended, or the FCPA, the Corruption of Foreign Public Officials Act, or the CFPOA, and similar laws associated with our activities outside of the U.S.
could subject us to penalties and other adverse consequences.
•
We are pursuing a long-term growth strategy that may include acquisitions and developing and enhancing an appropriate sales strategy, which requires
upfront investment with no guarantee of long-term returns.
•
We are regularly subject to general litigation and other claims, which could have an adverse effect on our business and results of operations.
•
Privacy concerns and our compliance with current and evolving domestic or foreign laws and regulations regarding the processing of personal information
and other data may increase our costs, impact our marketing efforts, or decrease adoption and use of our products and services, and our failure to comply
with those laws and regulations may expose us to liability and reputational harm.
•
Our business continuity plan may not operate effectively in the event of a significant interruption of our business.
•
Our insurance may be insufficient to cover losses that may occur as a result of our operations.
•
Certain global conditions may affect our ability to conduct successful events.
Financial Risks
•
Ineffective internal control over financial reporting could result in errors in our financial statements, reduce investor confidence, and adversely impact our
stock price.
•
We have substantial indebtedness, and the degree to which we are leveraged may materially and adversely affect our business, financial condition and
results of operations.
•
Our debt instruments have restrictive covenants that could limit our financial flexibility.
Risks Related to Our Intellectual Property
•
We may be unable to adequately protect or enforce our intellectual property rights, which could harm our reputation and adversely affect our growth
prospects.
Risks Related to Our Industry
•
Competition could result in reductions in our future revenues and profitability.
•
Decreases in the supply of, demand for, or market values of used equipment, could harm our business.
Risks Related to Our Organization and Governance
•
Our articles, by-laws, shareholder rights plan and applicable Canadian provincial and federal law contain provisions that may have the effect of delaying or
preventing a change in control.
•
U.S. civil liabilities may not be enforceable against us, our directors, or our officers.
•
We are governed by the corporate laws of Ontario, Canada, which in some cases have a different effect on shareholders than the corporate laws of
Delaware.
RB Global, Inc.
3
Table of Contents
PART I
ITEM 1: BUSINESS
Company Overview
RB Global, Inc. and its subsidiaries (collectively referred to as “RB Global”, the “Company”, "our", "us", or “we”) (NYSE & TSX: RBA) is a leading global
marketplace that provides value-added insights, services, transaction solutions for buyers and sellers of commercial assets and vehicles worldwide. Through
our auction sites in 14 countries and digital platforms, we serve customers and partners in approximately 170 countries across a variety of asset classes,
including automotive, commercial transportation, construction, government surplus, lifting and material handling, energy, mining and agriculture.
We primarily facilitate transactions for customers in the automotive and commercial, construction and transportation ("CC&T") sectors. Our customers are
primarily automotive insurance companies, as well as end users, dealers, fleet owners, and original equipment manufacturers (“OEMs”) of commercial assets
and vehicles. Gross transaction value in our CC&T sector includes equipment needed for earth moving, lift and material handling, as well as vocational and
commercial trucks and trailers. Our automotive sector includes all consumer automotive vehicles. The other sector primarily includes assets and equipment in
the agricultural, forestry and energy industries, government surplus assets, smaller consumer recreational transportation items and parts sold in our vehicle
dismantling business. Each respective sector includes salvage and non-salvage transactions.
We have a global presence, with operations primarily in the United States, Canada, Australia and across Europe, and employ more than 7,800 full-time
employees worldwide, of which approximately 67% are located in the United States.
Macroeconomic Conditions and Industry Trends
Various macroeconomic conditions and trends, such as inflationary pressures and interest rate volatility, impact our business, gross transaction value and
operating costs. In addition, our gross transaction value is impacted by the combination of unit volume growth and changes in average selling prices.
Global supply chain disruptions and strong demand for CC&T assets significantly impacted our customers' transaction behavior in recent years. The COVID-
19 pandemic initially led to a shortage of new equipment, driving up prices of used assets in our marketplace and extending asset holding periods. This pent-up
demand subsequently fueled a surge in transactions in 2023 which normalized in the second half of 2024 creating a challenging comparison for the full year.
Our customers and partners continue to experience lower equipment utilization rates, weaker end market demand, a higher interest rate environment, and
higher costs to acquire new assets, resulting in delays in replacing or adding assets to their existing asset base. These trends are contributing to a lower need for
our customers to transact equipment.
In our automotive sector, the total number of accidents and the number of accidents deemed a total loss influence unit volume growth in the industry. The total
number of accidents is a function of the number of vehicles in service and the aggregated number of miles driven. Used automotive prices, the age, and the
complexity of the design and technology content of vehicles, in combination with the cost of repair, are some of the factors that influence if a vehicle is deemed
a total loss. The current inflation spread between automotive repair and used vehicles is providing a productive environment for a higher number of vehicles
deemed a total loss as a percent of total accidents, which is driving industry salvage unit volume growth. Despite these positive trends, we have also seen used
automotive prices remain fairly flat year over year, as pricing has normalized following the pandemic.
Competition
We encounter different competitors by region, sector, and service across the entire suite of solutions we offer to our partners and customers.
Competition in our CC&T sector for transaction solutions is highly fragmented geographically and by transaction format. We compete for sellers against online
and physical auctioneers, brokers, OEMs and equipment dealers offering trade-in services. Some of our customers, including large fleet owners, may seek
private sales instead of third-party transaction solutions. The market is constantly evolving and subject to change driven by new and existing competitors and
technology-enabled selling solutions for sellers.
In the automotive sector, our sellers are comprised of primarily insurance companies seeking transaction solutions for their damaged or low-value vehicles. We
primarily compete with Copart, Inc., as well as with Total Resource Auctions, Inc., a subsidiary of Cox Enterprises, and certain other independent used vehicle
auction companies that regularly remarket damaged and total loss vehicles. We have contractual service level agreements and various supply agreements with
our sellers, primarily automotive insurance customers.
RB Global, Inc.
4
Table of Contents
Our performance against service level agreements and gross returns to drive optimal net returns is critical to our success as we compete.
Competitive Advantages
•
Global platform - Our global platform allows us to connect buyers and sellers, offer insights and value-added services for commercial assets and vehicles
through our omnichannel marketplace, both digitally and through our auction sites worldwide. We offer unmatched choice and flexibility, tailoring
transaction solutions to suit our customers' diverse and changing needs. We also offer our customers a full spectrum of value-added services, such as
transportation and logistics, appraisal, inspection, refurbishing, titling, loan payoff, and financial services.
•
Trusted customer relationships - Our sales teams act as trusted advisors in their long-standing customer relationships. We take a long-term view, offering
clear transparent communication and unparalleled solutions to simplify our customers' experience and cultivate lasting partnerships.
•
Data, insights and services - Rich data and analytics are a cornerstone to providing the best customer experience. We invest in data science to deliver asset
value predictions, generate user leads, prioritize marketing investments, interpret price trends, and more. Proprietary machine vision technology combined
with proprietary algorithmic asset pricing are used internally to set target values and optimize marketplace operations and externally to provide our
customers with real-time asset values. In addition, our Rouse Services ("Rouse") and brand is the leading provider of construction equipment rental
metrics, benchmarks, and construction equipment valuations to lenders, rental companies, contractors, and dealers. Our business model is built upon an
extensive data ecosystem, proprietary analytics, data science techniques, and trusted customer relationships rooted in service and confidentiality.
•
Global presence - We achieve exceptional agility with our extensive global network of 311 locations, which enables us to be closer in proximity to our
customers. This proximity helps minimize transportation costs and provides our customers with the choice of care, custody, and control of assets.
•
Flexibility of yard space and teammates - Teammates working across different businesses and sectors can come together across multiple locations to meet
our customers' needs when necessary. Specifically, in a catastrophic event impacting our automotive sector customers, we can increase the speed of our
response and avoid incremental operating costs by leveraging all of our teammates and any unused capacity across our global network of locations.
•
Global buyer base and demand engine - Our global presence and sophisticated approach to driving buyer demand allows us to generate deep pools of
liquidity for transactions, enabling global market pricing for commercial assets and vehicle sellers and helping to deliver the best price realization. We
serve customers in approximately 170 countries across a variety of sectors and continuously source and cultivate new buyers around the world.
•
Brand - Our well-established brands are well recognized and have a loyal customer base. The Company's marketplace brands include Ritchie Bros., the
world's largest auctioneer of commercial assets and vehicles, and IAA, a leading global digital marketplace connecting vehicle buyers and sellers. RB
Global's portfolio of brands also includes Rouse, which provides complete end-to-end asset management, data-driven intelligence, and performance
benchmarking system, SmartEquip, an innovative technology platform that supports customers' management of the equipment lifecycle and integrates
parts procurement with both original equipment manufacturers and dealers and VeriTread, an online marketplace for heavy haul transport.
Growth Strategy
The foundation of our growth strategy is to put our partners and customers first and over-deliver on our commitments. By doing this consistently, along with
operational excellence, we expect to solidify our position as their trusted global partner for insights, services, and transaction solutions.
We see significant opportunities to drive transactions and grow our market share by creating a seamless and trusted experience for our sellers and buyers. We
have three key areas of strategic focus:
i.
Achieve premium price performance for assets transacted across our omnichannel marketplaces while effectively accommodating our partners'
liquidity preferences. The key is to manage supply and create deep liquidity pools by expanding our global buyer base through harnessing technology
to merchandise assets at scale and provide a diverse and thoughtfully selected range of assets to meet each buyer's unique needs.
RB Global, Inc.
5
Table of Contents
ii.
Grow our enterprise partner base, which includes insurance companies in our automotive sector and large fleet owners in our CC&T sector. Our
partners increasingly rely on our expertise to enhance their profitability by optimizing the lifecycle of the assets they transact through us. The more
effectively we can communicate and demonstrate our value upstream from the transaction, the stronger our position will be to earn more transactions
from partners and gain market share.
iii. Focus on driving growth with our regional CC&T customers, comprised of small and mid-size businesses that highly value the personalized
engagement and relationship with our sales territory managers. By leveraging the expertise of our sales team as trusted advisors, we are confident in
our ability to strengthen these existing relationships and build new ones. As we optimize and expand our sales coverage, we are well-positioned to
capture additional market share and deliver sustained growth.
We aim to achieve our growth strategy by modernizing our technology capabilities, investing in the development of our teammates, and strategically acquiring
businesses and technologies to expand our capabilities and market reach.
Service Offerings
We provide a global marketplace for our partners and customers to buy and sell a variety of asset classes by leveraging our proprietary transaction solutions,
services and market insights. The table below outlines the various branded solutions we offer to help our partners and customers more efficiently manage their
asset lifecycles and improve on their return on investments.
RB Global, Inc.
6
Table of Contents
Solution
Brand(s)
Description
Transaction
Solutions
RB Auction
Onsite and online marketplace for selling and buying used equipment
IronPlanet
Online marketplace for selling and buying used equipment
Marketplace-E
Online make offer/buy now format
GovPlanet
Online marketplace for the sale of government and military assets
SalvageSale
Full-service project management and salvage inventory support
Ritchie Bros. Private Treaty
Confidential, negotiated sale of large equipment
IAA AuctionNow™
Online auction bidding and buying solution, that features inventory located at physical branches and offsite
locations. Available to a global buyer audience
IAA Buy Now™
Online buy now format available between scheduled auctions, leveraging ML based pricing
recommendations
IAA Custom Bid™
Bidding tool that provides buyers focused on recycling the ability to set pre-bids in an auction based on
vehicle attributes
IAA Timed Auctions™
Timed auction format that allows for competitive bidding and sale prior to a scheduled auction
CSAToday®
Online portal that gives sellers the ability to manage their vehicle assets and monitor sales performance
Financial Services
Ritchie Bros. Financial Services
Loan origination service that uses a brokerage model to match loan applicants with appropriate financial
lending institutions
Appraisal Services
Rouse Appraisals
Unbiased, certified appraisal services
Inspection Services
Ritchie Bros. Inspections
Truck and heavy equipment inspections
IAA Inspection Services®
Remote inspections and appraisals for salvage vehicles
Listings Services
Ritchie List, Mascus, Boom &
Bucket
Online equipment listing service , B2B dealer portal, and an online fixed price marketplace platform
Refurbishing
Services
Ritchie Bros. Refurbishing
Repair, paint, and other make-ready services
Transportation
Services
Ritchie Bros. Logistics
End-to-end transportation and customs clearance solution for sellers and buyers with shipping needs
VeriTread Transport
Online transportation marketplace, connecting shippers and carriers
IAA Transport™
Integrated shipping solution allowing buyers to schedule shipment of vehicles during the checkout process
IAA Tow App™
Mobile dispatch solution that assists the tow network
Data Services
Rouse™
The leading provider of construction equipment market intelligence
IAA Vehicle Score™
A cutting-edge computer vision tool that assesses vehicle damage severity. Our automated Vehicle Score
model provides fast and accurate ratings based on photos taken at vehicle check-in, saving time and money
IAA Vehicle Value™
A predictive model that uses machine learning and data mining methods to create an accurate, unbiased
vehicle value
Parts Services
SmartEquip
Online marketplace connecting equipment owners with parts manufacturers
Catastrophe
Response Services
Catastrophe (CAT) Services™
Industry-leading strategic catastrophe response service focused on real estate capacity, operational execution,
transportation logistics and vehicle merchandising and selling
Title Services
IAA Title Services®
Full suite of title services that facilitate the title documentation, settlement and retrieval process
IAA Loan Payoff™
Service that mitigates the time-consuming process of managing a total loss claim requiring loan payoff and
title release
DDI Technology
Electronic title and registration services for vehicles dealers and lenders
RB Global, Inc.
7
Table of Contents
Contract options
We offer consignors several contract options to meet their individual needs and sale objectives for selling assets, which include:
•
Straight commission contracts, where the consignor receives the gross proceeds from the sale less a pre-negotiated commission rate;
•
Fixed fee commission contracts, where the consignor receives the gross proceeds from the sale less a fixed flat fee; and
•
Guarantee contracts, where the consignor receives a guaranteed minimum amount plus an additional amount if proceeds exceed a specified level.
We also offer our customers the option to enter into inventory contracts, where we purchase assets before they are resold in the auctions or marketplaces. We
may also sell consigned assets or purchased inventory in private sales transactions.
Other value-added services
We also provide a wide array of value-added services to make the process of selling and buying equipment and vehicles convenient for our customers. In
addition to the services listed in the table above, we also provide the following value-added services to our customers:
•
Title search services, where registries are commercially available, to help ensure equipment sold through RB Global is free and clear of all liens and
encumbrances (if we are not able to deliver clear title, we provide a full refund up to the purchase price to the buyer);
•
Making equipment available for inspection, testing, and comparison by prospective buyers;
•
Displaying high-quality, zoomable photographs of equipment on our website;
•
Providing 360-degree video inspection technology to increase buyer confidence in equipment being purchased;
•
Providing industry-leading professional equipment inspections and reports;
•
Providing free detailed equipment information on our website for most equipment;
•
Providing access to commercial transportation companies and customs brokerages through our logistical services, and
•
Handling all pre-auction marketing, as well as collection and disbursement of proceeds.
Intellectual Property
We believe our intellectual property has significant value and is an important factor in marketing our organization, services, and website, as well as
differentiating us from our competitors. We own or hold the rights to use valuable intellectual property such as trademarks, service marks, domain names and
tradenames. We protect our intellectual property in Canada, the U.S., and internationally through federal, provincial, state, and common law rights, including
registration of certain trademark and service marks for many of our brands, including our core brands. We also have secured patents for inventions and have
registered our domain names.
We rely on contractual restrictions and rights to protect certain of our proprietary rights in products and services. Effective protection of our intellectual
property can be expensive to maintain and may require litigation. We must protect our intellectual property rights and other proprietary rights in many
jurisdictions throughout the world. In addition, we may, from time to time, be subject to intellectual property claims, including allegations of infringement,
which can be costly to defend. For a discussion of the risks involved with intellectual property litigation and enforcement of our intellectual property rights, see
the related information in “Part I, Item 1A: Risk Factors” of this Annual Report on Form 10-K.
Environmental, Social & Governance
In 2024, RB Global continued to advance its Environmental, Social and Governance ("ESG") framework, which was developed in 2022 and subsequently
aligned with IAA's ESG program in 2023, and which includes the integration of ESG approaches, resources, and capabilities.
Our ESG framework remains instrumental in guiding our actions and driving our ESG progress. We use our framework to establish our goals and performance
metrics. As with many areas of the business, we used the post-acquisition integration period to analyze and incorporate best practices of our brands' reporting to
shape our combined ESG strategy. As part of our commitment to continuous improvement, we will continue to work closely with our ESG program
stakeholders to ensure that our priorities remain aligned with our partners in the industry and the values that we share.
Below is an overview of RB Global's commitment to ESG. Please see our website for our latest sustainability reports and further details on our initiatives and
accomplishments.
RB Global, Inc.
8
Table of Contents
Environmental
The Company is regulated by federal, state, local jurisdictions, and international environmental laws governing the protection of the environment, health and
safety, the use, transport and disposal of hazardous substances and control of emissions including greenhouse gases into the environment. Compliance with
these existing laws has not had a material impact on our capital expenditures, earnings or global competitive position. However, climate change initiatives and
changing laws and regulations governing the environment may affect the supply of, the demand for, and the market values of equipment in the future.
Our business enables a circular economy of vehicles and equipment. We engage our customers to optimize the use and efficiency of equipment, to re-use,
refurbish and recycle before disposition, as extending the life of heavy equipment and vehicles is core to our business model. In turn, we believe this reduces
waste and lessens the need to extract natural resources to produce equipment.
In 2024, we continued to take the opportunity to comprehensively evaluate our environmental impact, considering the impacts from the acquisition of IAA. In
2023, to support our reporting and take further meaningful action, we developed a baseline carbon inventory of Scopes 1, 2 and 3 inventory using recognized
standards such as the Greenhouse Gas ("GHG") protocol. This enabled us to gain a more complete understanding of our global carbon footprint and identify
areas where we can make improvements. With this valuable data, we are well-equipped to establish achievable reduction targets, track our progress, and
effectively manage and mitigate our environmental impact.
We continue our commitment to environmental management by ensuring availability of treatment systems to manage wastewater, a recycling system to
promote waste management and air filtration systems when necessary.
Social
Human Capital
We employ approximately 7,800 full-time employees and approximately 890 part-time employees worldwide at December 31, 2024. Approximately 5,200 of
our full-time employees work at our auction and branch sites to support our operations and solution services and approximately 1,200 full-time employees are
focused on sales and solutions for our customers. We also periodically hire contractors as needed to support our auctions, various businesses, and other
projects.
Development and Engagement
We believe that our people are our greatest asset and that engaged employees are paramount to the health and success of our business. We invest in a variety of
training, development and engagement practices to deliver on our growth agenda and create more leaders.
RB Global continues to invest in employee learning and development. All full-time employees are encouraged to have development plans that focus on career
growth. We have curated tools and resources and developed training programs to provide our leaders and employees with the skills to grow successfully. We
provide all of our employees access to virtual instructor-led courses, as well as access to a library of over 3,000 online courses and resources.
RB Global, Inc.
9
Table of Contents
During 2024, we achieved the following objectives to strengthen the development and engagement of our people:
•
We continue to hold quarterly performance conversations to drive performance and ongoing engagement, with a simplified year-end review process to
allow for more meaningful conversations about accomplishments, values and opportunities.
•
We offer a six-week Leadership Foundations Program to newly promoted and first-time managers, to instill the confidence needed to inspire, delegate, and
communicate effectively in their new role.
•
We launched a new self-service Mentorship Program to support and encourage employees to learn from connections and meaningful relationships with
experienced leaders.
•
We continue to support the sales team's expanded sales coverage initiative through our sales bootcamps. In addition, we launched the Master Your Craft
training initiative, which provides focused, quick-hit lessons on key sales skills and best practices.
•
We continue to strengthen our salvage sale operational training program by integrating analytics and personalized learning paths. Our strategic
improvements aim to enhance workforce efficiency, reduce knowledge gaps, and drive growth.
•
We strengthened our IAA title training program through a blended learning model with the aim to reduce attrition and enhance knowledge and efficiency
within our workforce.
We continuously look for ways to create on-the-job learning opportunities so that our employees feel invested and engaged. Employees are involved in
strategic initiatives and in finding ways to better serve our customers, and each other.
Health & Safety
Safety is a top priority at RB Global and core to who we are. Our objective is to keep our people healthy and safe – to send everyone home, every day, the way
they came to work. Our global Environmental, Health, Safety and Security ("EHSS") team is focused on creating a unified approach to policies, procedures and
best practices with the goal of keeping our teammates and customers safe. The EHSS team is responsible for introducing operational updates to support our
commitment to maintaining the highest level of environmental, health and safety standards.
All new employees are required to complete a safety onboarding training that captures our health and safety programs, our policy statement and provides an
overview of our global Employee Health and Safety (“EHSS”) policies and expectations. Our 2024 completion rate for the safety onboarding program was
97% (2023: 93%). We also have a risk management process to support our safety orientation programs and our health and safety commitment, which ensures
that our employees are exposed to the lowest possible level of risk. Our risk management process begins with an annual review of all incidents from the prior
year to identify trends and assess whether we need to address findings through changes in our policies and procedures.
In 2024, all auction sites completed monthly hazard assessments to identify risks and take the necessary corrective actions. In addition, we also require all of
our global employees in operations to complete a mandatory annual safety training curriculum.
We measure our Total Recordable Injury Rate (“TRIR”), which is the number of reportable incidences per 100 full-time workers during the year. Our annual
TRIR goal is to be lower than the industrial average. TRIR for 2024 was 1.78 (2023: 1.05), which was below the industrial average.
Community Giving
We are committed to support the communities where we live and work. In 2024, we responded to the devastating hurricanes across the United States through
donations and sponsorship to local organizations to deliver critical resources such as food, clothing, housing and supplies.
Flexible Workplace
We continue to provide flexible work arrangements - on-site, remote and hybrid - to our people based on the needs of our customers and businesses and
encourage opportunities to build engagement and foster connections on-site and within the hybrid world through numerous gatherings and social events across
all offices.
Ethical Conduct
We are committed to a culture of excellence. We aim to build a community with strong values of responsibility and integrity, continue to invest in training and
development, and to create an open environment where honest communications are the expectation – not the exception. Our Code of Conduct contains
guidelines for conducting business with the highest standards of ethical behavior. We also offer the RB Global Ethics Hotline, which is operated by an
independent third party and is always available from any location around the world, as a resource through, which anonymous concerns can be raised.
Governance
We believe in doing the right thing for everyone involved in our business and seek to do business with third parties who follow the same core values. This is
reflected in our Code of Business Conduct and Ethics, which is delivered through annual training to our
RB Global, Inc.
10
Table of Contents
employees and supported by our third-party Ethics Hotline. With the exception of our CEO, our Board of Directors consists of elected independent members.
Oversight of our ESG enterprise strategy is provided by the Nominating and Corporate Governance Committee, while our global ELT provides strategic
direction and oversight of ESG across key business functions.
The Role of Technology
Building a modern architecture on which we can scale and grow profitably is a core element of our growth strategy. The role of technology in our business
continues to evolve and becomes increasingly important, as our sellers and buyers adopt mobile and online channels to complete their transactions and fulfill
their business needs. We continue to invest in technologies to transition to a modern cloud-based architecture, driven by microservices that allow for agility,
flexibility and scalability of our solutions. In 2024, we also invested and acquired Boom & Bucket Inc, a digital fixed price marketplace which we can add to
our portfolio of selling solutions.
We remain focused on technology enablement to transform the way we leverage technology to drive future profitable growth. We are in the deployment phase
of providing our customers a modern unified payment system to process transaction solutions. We are also investing in the development of a new platform to
unite our various auction platforms to provide greater stability and simplify our processes for buyers and sellers. Our new platform is designed to provide an
updated modern design, improved search functions and navigation capabilities to make it easier for our customers to bid at our auctions and process their
transactions. During 2024, we have begun to rollout our digital payments platform and digital checkout system at a select number of auction events and will
continue to evaluate, invest and evolve our products and capabilities based on the ongoing needs of our customers and partners.
Our technology capabilities also deliver choices for our customers in the form of multiple channels for buyers and sellers, meeting customers’ asset
management needs through information-rich software solutions and leveraging our rich data repository to drive strong sales and improved pricing decisions.
We provide our customers with leading tools and capabilities to deliver full life-cycle asset management for used equipment and vehicles.
Revenue Mix
Our revenue is comprised of service revenue and inventory sales revenue. Total service revenue includes revenue by customer type, between revenue earned
from buyers or sellers who transact in our live and online auctions, online marketplaces and private brokerages, as well as marketplace services revenue,
revenue earned from optional services provided to our customers.
In the third quarter of 2024, we updated our presentation of disaggregated revenue to align to how management evaluates its financial and business
performance. The prior year disaggregation of revenue amounts have been recast to conform with current period presentation. We previously disaggregated our
revenue by commissions earned from our consignors, buyer fees earned from our buyers in each sale transaction, and presented all other fees earned in the
rendering of our services, whether related to auctions, online marketplaces, private brokerage or other services, within marketplace services revenue. As part of
our updated presentation, transactional seller revenue now includes commissions, pre-negotiated or fixed, as well as certain auction-related fees earned from
sellers to complete the sale of an asset, such as towing to our yards, liens search, title processing and online listing and inspection fees. Transactional buyer
revenue now includes buyer transaction fees based on a tiered structure earned from purchasers upon purchase of an asset, as well as other auction-related fees
earned from buyers to complete the purchase of an asset, such as title processing, late-pick up, salvage buyer platform registration and other administrative
processing charges. Accordingly, certain auction-related fees
RB Global, Inc.
11
Table of Contents
were reclassified from marketplace services revenue to transactional seller or transactional buyer revenue. These changes were made in order to align with how
management categorize revenues for internal management purposes.
Our service revenue is comprised of the following:
•
Transactional seller revenue which includes commissions earned from consignors on the sale of consigned assets, as well as other fees earned from
consignors to facilitate the sale of an asset such as towing to our yards, liens search, title processing and online listing and inspection fees.
•
Transactional buyer revenue which includes transaction fees based on a tiered structure earned from the purchasers of consigned assets and inventory, as
well as other fees earned from buyers to complete the purchase of an asset, such as title processing, late pick-up, vehicle buyer platform registration and
other administrative processing charges.
•
Marketplace services revenue which includes fees earned from various optional services provided to buyers, sellers, or other third-parties, such as
transportation, buyer towing, refurbishment, financing, parts procurement, data and appraisal, and other ancillary services.
Inventory sales revenue relates to revenue earned through our inventory contracts and is recognized as the GTV of the assets sold, with the related cost
recognized in cost of inventory sold.
Our revenue each period can fluctuate significantly based on the mix of sales arrangements, which is driven by customer preferences. Completed straight
commission, fixed commission or guarantee commission contracts result in the commission being recognized as service revenue based on a percentage of gross
transaction value or based on a fixed value, while completed inventory contracts result in the full GTV of the assets sold being recorded as inventory sales
revenue. As a result, a change in the revenue mix between service revenue and revenue from inventory sales can have a significant impact on our revenue
growth percentages.
Governmental Regulations and Environmental Laws
Our operations are subject to a variety of federal, provincial, state and local laws, rules, and regulations throughout the world. Compliance with these
regulations and laws requires human level awareness, performance and expertise, and investments in our enterprise management systems to facilitate efficient
workflow, data tracking and auditing capabilities to measure compliance. We believe that we are compliant in all material respects with those laws, rules, and
regulations that affect our business, and that such compliance does not impose a material impediment on our ability to conduct our business.
We believe that, among other things, laws, rules, and regulations related to the following list of items affect our business:
•
Imports and exports of commercial assets. Particularly, there are restrictions in the U.S. and Europe that may affect the ability of equipment owners to
transport certain equipment between specified jurisdictions. Also, engine emission standards in some jurisdictions limit the operation of certain trucks and
equipment in those regions.
•
Development or expansion of auction sites. Such activities depend upon the receipt of required licenses, permits, and other governmental authorizations.
We are also subject to various local zoning requirements pertaining to the location of our auction sites, which vary among jurisdictions.
•
The use, storage, discharge, and disposal of environmentally sensitive materials. Under such laws, an owner or lessee of, or other person involved in, real
estate may be liable for the costs of removal or remediation of certain hazardous or toxic substances located on or in, or emanating from, such property, as
well as related costs of investigation and property damage. These laws often impose liability without regard to whether the owner or lessee or other person
knew of, or was responsible for, the presence of such hazardous or toxic substances.
•
Worker health and safety, privacy of customer information, and the use, storage, discharge, and disposal of environmentally sensitive materials.
•
The acquisition and sale of totaled and recovered theft vehicles are regulated by state or other local motor vehicle departments in each of the locations in
which we operate.
•
Some of the transport vehicles used at our marketplaces are regulated by the U.S. Department of Transportation or similar regulatory agencies in the other
countries in which we operate.
•
In many states and provinces, regulations require that a damaged and total loss vehicle be forever “branded” with a salvage notice in order to notify
prospective purchasers of the vehicle’s previous salvage status.
•
Some state, provincial and local regulations limit who can purchase damaged and total loss vehicles, as well as determine whether a damaged and total loss
vehicle can be sold as rebuildable or must be sold for parts or scrap only.
•
We are subject to various local zoning requirements with regard to the location of our auction and storage facilities, which requirements vary from location
to location.
RB Global, Inc.
12
Table of Contents
•
We are indirectly subject to the regulations of the Consumer Financial Protection Act of 2010 due to our vendor relationships with financial institutions.
•
We deal with significant amounts of cash in our operations at certain locations and are subject to various reporting and anti-money laundering regulations.
Available Information
We file with the SEC reports on Form 10-K, Form 10-Q, Form 8-K, proxy materials and other filings required under the Exchange Act. Investors may access
any materials we file with the SEC through the EDGAR database on the SEC’s website at www.sec.gov.
In addition, investors and others should note that we announce material financial information using our company website (https://rbglobal.com) and investor
relations website (https://investor.rbglobal.com), which host our SEC filings, press releases, public conference calls, and webcasts. Information about RB
Global, Inc., its business, and its results of operations may also be announced by posts on LinkedIn (https://www.linkedin.com/company/rb-global-inc).
The information that we post on our LinkedIn page could be deemed to be material information. As a result, we encourage investors, the media, and others
interested in RB Global, Inc. to review the information that we post on our LinkedIn page.
We are providing these website addresses solely for the information of investors, and the information on or accessible through our websites and social media
channel is not incorporated by reference in this Annual Report on Form 10-K.
Also available for investors in the Governance section of our investor relations website are the Code of Business Conduct and Ethics for our directors, officers
and employees (“Code of Conduct”), Board Mandate, Audit Committee Charter, Nominating and Corporate Governance Committee Charter, Compensation
Committee Charter, Corporate Governance Guidelines, Diversity Policy, Shareholder Engagement Policy, Articles and Bylaws, and Board Chair Role and
Description. Additional information related to RB Global, Inc. is also available on SEDAR at www.sedar.com.
As a Business Corporations Act (Ontario) (“OBCA”) company with our principal place of business in Canada, U.S. civil liabilities may not be enforceable
against us. Please see “Part I, Item 1A. Risk Factors — U.S. civil liabilities may not be enforceable against us, our directors, or our officers.
ITEM 1A: RISK FACTORS
An investment in our common stock involves a high degree of risk. In addition to the other information included in this Annual Report on Form 10-K, you
should carefully consider each of the risks described below before purchasing our common shares. The risk factors set forth below are not the only risks that
may affect our business. Our business could also be affected by additional risks not currently known to us or that we currently deem to be immaterial. If any of
the following risks actually occur, our business, financial condition and results of operations could materially suffer. As a result, the trading price of our
common shares could decline, and you may lose all or part of your investment. Information in this section may be considered “forward-looking statements.”
See “Cautionary Note Regarding Forward-Looking Statements” for a discussion of certain qualifications regarding such statements.
Risk Related to Our Business
Our business and operating results would be adversely affected due to the loss of one or more significant suppliers, a reduction in significant volume from
suppliers, an adverse change in our supplier relationships, or a disruption to our supply of damaged, total loss and low-value vehicles.
Our business depends on suppliers of damaged, total loss and low-value vehicles. Our vehicle suppliers include insurance companies, used-vehicle dealers,
rental car and fleet lease companies, auto lenders and charitable organizations, among others. We have established long-term relationships with virtually all of
the major automobile insurance companies. During fiscal 2024, approximately 22% of our consolidated revenues were associated with vehicles supplied by the
Company's three largest supplier customers. Our agreements with insurance company suppliers are generally subject to cancellation by either party upon 30 to
90 days’ notice. There can be no assurance that our existing agreements will not be canceled or that we will be able to enter into future agreements on favorable
terms with these suppliers. We work to develop strong relationships with our suppliers to better understand their needs. From time to time, however, we may
experience the loss of suppliers or a reduction in volume from suppliers, including top vehicle suppliers. If we lose one or more of our significant suppliers, or
if one or more of our large suppliers were to significantly reduce volume for any reason or favor competitors or new entrants, we may not be successful in
replacing such business and our profitability and operating results could be materially adversely affected.
Generally, institutional and dealer suppliers make non-binding long-term commitments with us regarding consignment volumes. Changes in the consignment
patterns of our key suppliers could have a material adverse effect on our business and operations. There
RB Global, Inc.
13
Table of Contents
are many factors that can adversely affect volume from suppliers, many of which are beyond our control. These factors include, but are not limited to, the
following:
•
A decrease in the number of vehicles in operation or miles driven;
•
Mild weather conditions that cause fewer traffic accidents;
•
Reduction of policy writing by insurance providers that would affect the number of claims over a period of time;
•
Increases in fuel prices that could lead to a reduction in the miles driven per vehicle, which may reduce the accident rate;
•
Changes in vehicle technology, an increase in autonomous vehicles and vehicles equipped with advanced driver-assistance systems (ADAS);
•
A decrease in the percentage of claims resulting in a total loss or elimination of automotive collision coverage by consumers;
•
Delays or changes in state title processing;
•
Government regulations on the standards for producing vehicles; and
•
Changes in direct repair procedures that would reduce the number of newer, less damaged total loss vehicles, which tend to have higher salvage values.
Furthermore, in periods when the supply of vehicles from the insurance sector declines, salvage operators have acquired and, in the future, may acquire
vehicles on their own. Also, when used vehicle prices are high, used-vehicle dealers may retail more of their trade-in vehicles on their own rather than selling
them at auction. If the supply or value of damaged, total loss and low-value vehicles coming to auction declines significantly, our revenues and profitability
may be adversely affected.
Our business and operating results would be adversely affected if we are unable to meet or exceed our buyer customers’ demand and expectations or due to
a disruption in demand of damaged, total loss and low-value vehicles.
We believe our future success depends in part on our ability to respond to changes in buyer requirements, our ability to meet service level expectations of both
buyers and sellers and our ability to meet regulatory requirements for such customers. IAA’s buyer customers include automotive body shops, rebuilders, used
car dealers, automotive wholesalers, exporters, dismantlers, recyclers, brokers, and the general public, among others. We work to develop strong relationships
and interactive dialogue with our customers to better understand current trends and customer needs. If we are not successful in meeting our customers’
expectations, our customer relationships could be negatively affected and result in a loss of future business, which would adversely affect our operating results
and financial condition.
Our market position and competitive advantage could be threatened by our competitors and/or disruptive new entrants.
We face significant competition for the supply of damaged and total loss vehicles and the buyers of those vehicles. IAA’s principal sources of competition
historically have come from (1) direct competitors, (2) new entrants, including new vehicle remarketing venues, and (3) existing alternative vehicle
remarketing venues, including used-vehicle auctions and certain salvage buyer groups. Due to the increasing use of the Internet and other technology as
marketing and distribution channels, we may face increasing competition from online wholesale and retail marketplaces (generally without any meaningful
physical presence) and from our own customers, including insurance companies, when they sell directly to end users through such platforms rather than
remarket vehicles through our marketplaces. Increased competition could result in price reductions, reduced margins or loss of market share.
Our future success also depends on our ability to respond to evolving industry trends, changes in customer requirements and new technologies. Some of IAA’s
competitors may have greater financial and marketing resources than we do, may be able to respond more quickly to evolving industry dynamics and changes
in customer requirements, or may be able to devote greater resources to the development, promotion and sale of new or emerging services and technologies.
Our ability to successfully grow through investments in the area of emerging opportunities depends on many factors, including advancements in technology,
regulatory changes and other factors that are difficult to predict, or that may significantly affect the future of electrification, autonomy, and mobility. If we are
unable to compete successfully or to successfully adapt to industry changes, our business, revenues and profitability could be materially adversely affected.
If our facilities lack the capacity to accept additional vehicles, then our relationships with insurance companies or other vehicle suppliers could be
adversely affected.
Capacity at our facilities varies from period to period and by region as a result of various factors, including natural disasters. We may not be able to reach
agreements to purchase or lease storage facilities in markets where we have limited available capacity, and zoning restrictions or difficulties obtaining use
permits may limit our ability to expand our capacity through acquisitions of new land. If we fail to have sufficient capacity at one or more of our facilities, our
relationships with insurance companies or other vehicle suppliers could be adversely affected, which could adversely affect our operating results and financial
condition.
We may be unable to keep existing facilities or open new facilities in desirable locations and on favorable terms, which could materially and adversely
affect our results of operations.
Local land use and zoning regulations, environmental regulations and other regulatory requirements may impact our ability to find
RB Global, Inc.
14
Table of Contents
suitable locations and influence the cost of our operations. Most of IAA’s salvage auction vehicle facilities are leased. The termination or expiration of leases at
existing facilities may adversely affect us if the renewal terms of those leases are unacceptable to us and we are forced to close the facilities. If we determine to
close a location, we may remain obligated under the applicable lease for the remaining lease term and may have to expense the unamortized portion of the
right-of-use assets, in part or in full, as an impairment which may have a material impact on our consolidated results of operations and financial position. Also,
if we are unable to maintain our existing facilities or open new facilities in desirable locations and on favorable terms, our results of operations could be
materially and adversely affected. Further, in an increasing number of markets where we experience significant capacity constraints together with pressing
customer demand and a lack of viable alternatives for expansion due to zoning and land use restrictions, we may be required to purchase, lease or occupy
industrial sites, which may contain significant environmental impacts.
In addition, some of the facilities on which we operate are impacted by significant recognized environmental concerns and pollution conditions. IAA has
incurred, and we may in the future incur, expenditures relating to compliance and risk mitigation efforts, releases of hazardous materials, investigative,
remedial or corrective actions, claims by third parties and other environmental issues, and such expenditures, individually or in the aggregate, could be
significant. Federal and state environmental authorities are currently investigating IAA’s role in contributing to contamination at the Lower Duwamish
Waterway Superfund Site in Seattle, Washington and the role of one of IAA’s subsidiaries in contributing to the Pyrite Canyon Plume in Jurupa Valley,
California. Our potential liability at these sites cannot be estimated at this time.
Macroeconomic factors, including high fuel prices, high labor costs, inflation and changes in used car prices, may have an adverse effect on our revenues
and operating results.
Macroeconomic factors that affect oil prices and the vehicle and commodity markets can have adverse effects on our revenue and operating results. Significant
increases in the cost of fuel, whether due to inflationary pressures or otherwise, could lead to a reduction in miles driven per car and a reduction in accident
rates. A material reduction in accident rates, whether due to a reduction in miles driven or other factors, could reduce our vehicle assignment volumes, which in
turn, could have a material adverse impact on our revenues. In addition, significant increases in the cost of fuel have resulted and could continue to result in an
increase in the prices charged to us by our independent subhaulers and trucking fleet operators. Further, we have recently experienced labor shortages, which
have resulted in an increase in associated costs, such as increased overtime to meet demand and increased wages to attract and retain employees. If these
conditions or other inflationary pressures continue, our costs for towing and branch labor may continue to rise. To the extent we are unable to pass these costs
on to our customers, the increase in prices charged by our independent subhaulers and trucking fleet operators and the increase in labor costs could negatively
impact our profitability.
Volatility in salvage car prices could have a material adverse effect on our revenues in future periods.
Adverse economic conditions, including increases in interest rates and lease rates, real estate values and real estate development and construction costs, may
increase the costs required to invest in capacity expansion or delay our ability to open new facilities, both of which could have a material impact on our
consolidated results of operations and financial position.
Reliance on our subhaulers and trucking fleet operations could materially and adversely affect our business and reputation.
We rely on independent subhaulers and trucking fleet operations to pick up and deliver vehicles to and from our auction facilities. Consistent with the economy
generally, we have recently experienced a shortage of towers and haulers, which has resulted in an increase in costs charged to us by towers and subhaulers for
these services, and we cannot provide assurances that towers and subhaulers will be available in a timely manner to pick up and deliver vehicles. Failure to pick
up and deliver vehicles in a timely manner could harm our brand and reputation, and adversely impact our overall business and results of operations. Further,
an increase in fuel cost may lead to increased prices charged by our independent subhaulers and trucking fleet operators, which may significantly increase our
cost. We may not be able to pass these costs on to our suppliers or buyers. We are also exposed to risks associated with inclement weather, disruptions in the
transportation infrastructure and increase in the price of fuel, any of which could increase our operating costs. If we experience problems or are unable to
negotiate or obtain favorable terms with our subhaulers, our results of operations could be materially and adversely affected.
Weather-related and other events beyond our control may adversely impact operations.
Extreme weather or other events, such as hurricanes, tornadoes, earthquakes, forest fires, floods, global pandemics or other health crises, terrorist attacks or
war, may adversely affect the overall economic environment, the markets in which we compete, and our operations and profitability. These events, which may
increase in frequency and magnitude as a result of climate change, may impact our physical auction facilities, causing a material increase in costs, or delays or
cancellation of auction sales, which could have a material adverse impact on our revenues and profitability. In some instances, for example with the severe
storm in September 2022 known as “Hurricane Ian”, these events may result in a sharp influx in the available supply of damaged and total loss vehicles and
there can be no assurance that our business will have sufficient resources to handle such extreme increases in supply. Our failure to meet our customers’
demands in such situations could negatively affect our relationships with such customers and result in a loss of
RB Global, Inc.
15
Table of Contents
future business, which would adversely affect our operating results and financial condition. In addition, revenues generated as a result of the total loss of
vehicles associated with such a catastrophe are typically recognized subsequent to the incurrence of incremental costs and such revenues may not be sufficient
to offset the costs incurred.
Mild weather conditions tend to result in a decrease in the available supply of damaged and total loss vehicles because traffic accidents decrease, and fewer
vehicles are damaged. Accordingly, mild weather can have an adverse effect on our damaged and total loss vehicle inventories, which would be expected to
have an adverse effect on our revenue and operating results and related growth rates.
An increase in the number of damaged and total loss vehicles we purchase could adversely affect our profitability.
In certain countries, the salvage market typically operates on a principal basis, in which a vehicle is purchased and then resold, rather than on an agent basis, in
which the auction acts as a sales agent for the owner of the vehicle. Operating on a principal basis exposes us to inventory risks, including losses from theft,
damage and obsolescence. If we purchase vehicles, the increased costs associated with acquiring the vehicles could have a material adverse effect on our gross
profit margin and operating results. Vehicles sold under purchase agreements were approximately 4.1% of IAA’s vehicles sold both domestically and
internationally for fiscal year 2024. In addition, when vehicles are purchased, we are subject to changes in vehicle values, such as those caused by changes in
commodity prices or changes in used car prices. Decreases in commodity prices, such as steel and platinum, may negatively affect vehicle values and demand
at auctions. In addition, declines in used car prices, especially if they occur faster than anticipated, can lead to a significant gap between pre-accident value and
sales price.
A significant change in used-vehicle prices could impact the proceeds and revenue from the sale of damaged and total loss vehicles.
The volume of new vehicle production, accuracy of lease residual estimates, interest rate fluctuations, customer demand and changes in regulations, among
other things, all potentially affect the pricing of used vehicles. A sustained reduction in used-vehicle pricing could result in lower proceeds from the sale of
damaged and total loss vehicles and a related reduction in revenue per vehicle, a potential loss of consignors and decreased profitability. Conversely, when used
vehicle prices are high, used-vehicle dealers may retail more of their trade-in vehicles on their own rather than selling them at auction, which could adversely
affect our revenues and profitability.
IAA assumes the settlement risk for vehicles sold through its marketplaces.
Typically, following the sale of a vehicle, IAA does not release the vehicle to a buyer until such time as it has received full payment for the vehicle. We may be
obligated, however, to remit payment to a seller before receiving payment from a buyer and in those circumstances, we may not have recourse against sellers
for any buyer’s failure to satisfy its payment obligations. Because we retain possession of the vehicle, we can resell the vehicle to mitigate any potential losses.
Since revenue for most vehicles does not include the gross sales proceeds, failure to collect the receivables in full may result in a net loss up to the amount of
gross sales proceeds on a per vehicle basis in addition to any expenses incurred to collect the receivables and to provide the services associated with the
vehicle. If we are unable to collect payments on a large number of vehicles and we are unable to resell them and recover our costs, the resulting payment
obligations to the seller and decreased fee revenues may have a material adverse effect on our results of operations and financial condition.
Changes in laws affecting the import and export of damaged and total loss vehicles may have an adverse effect on our business and financial condition.
Changes in laws, regulations and treaties that restrict the importation of damaged and total loss vehicles into foreign countries may reduce the demand for
damaged and total loss vehicles and impact our ability to maintain or increase IAA’s international buyer base. The adoption of such laws or regulations in other
jurisdictions that have the effect of reducing or curtailing our activities abroad could have a material adverse effect on our results of operations and financial
condition by reducing the demand for our products and services.
We are subject to potential liabilities with respect to IAA’s prior separation from KAR Auction Services, Inc.
On February 27, 2018, KAR Auction Services, Inc. (“KAR”) announced a plan to pursue the separation and spin-off (the “Separation”) of IAA (its salvage
auction services business) into a separate public company. On June 28, 2019, KAR completed the distribution of 100% of the issued and outstanding shares of
common stock of IAA to the holders of record of KAR’s common stock on June 18, 2019, on a pro rata basis (the “Distribution”). Under the terms of the
Separation and Distribution, each of IAA and KAR is required to indemnify the other party from and with respect to certain liabilities. IAA’s and KAR’s ability
to satisfy these indemnities, if called upon to do so, will depend respectively upon our and KAR’s future financial strength. If we are required to indemnify
KAR, or if we are not able to collect on indemnification rights from KAR, our financial condition, liquidity or results of operations could be materially and
adversely affected.
RB Global, Inc.
16
Table of Contents
We may not realize the anticipated benefits of, and synergies from, acquisitions and may become responsible for certain liabilities and integration costs as a
result.
We have acquired, and may continue to acquire, businesses that have previously operated independently from us. The integration of our operations with those
of acquired businesses, including IAA, is intended to result in financial and operational benefits, including certain tax and run-rate synergies. There can be no
assurance, however, regarding when or the extent to which we will be able to realize these and other benefits. Integration may also be difficult, unpredictable
and subject to delay because of possible company culture conflicts and different opinions on future business development. We may be required to integrate or,
in some cases, replace, numerous systems, including those involving management information, purchasing, accounting and finance, sales, billing, employee
benefits, payroll and regulatory compliance, many of which may be dissimilar. Difficulties associated with the integration of acquired businesses could have a
material adverse effect on our business.
In addition, in connection with acquisitions, we have assumed, and may assume in connection with future acquisitions, certain potential liabilities. To the extent
such liabilities are not identified by us or to the extent indemnifications obtained from third parties are insufficient to cover such liabilities, these liabilities
could have a material adverse effect on our business.
Damage to our reputation could harm our business.
One of our founding principles is that we operate a fair and transparent business, and consistently act with integrity. Maintaining a positive reputation is key to
our ability to attract and maintain customers, investors and employees. Damage to our reputation could cause significant harm to our business. Harm to our
reputation could arise in a number of ways, including, but not limited to, employee conduct which is not aligned with our Code of Business Conduct and Ethics
(and associated Company policies around behavioral expectations) or our Company’s core values, safety incidents, failure to maintain customer service
standards, loss of trust in the fairness of our sales processes, the types of assets that we choose or are obligated to sell, and other technology or compliance
failures.
We may incur losses as a result of our guarantee and inventory contracts and advances to consignors.
Our most common type of auction contract is a straight commission contract, under which we earn a pre-negotiated, fixed commission rate on the gross sales
price of the consigned equipment at auction. We use straight commission contracts when we act as agent for consignors. In recent years, a majority of our
annual business has been conducted on a straight commission basis. In certain other situations, we will enter into underwritten transactions and either offer to
(a) guarantee a minimum level of sale proceeds to the consignor, regardless of the ultimate selling price of the consignment; or (b) purchase the equipment
outright from the seller for sale through one of our sales channels.
We determine the level of guaranteed proceeds or inventory purchase price based on appraisals performed on equipment by our internal personnel. Inaccurate
appraisals could result in guarantees or inventory values that exceed the realizable auction proceeds. In addition, a change in market values could also result in
guarantee or inventory values exceeding the realizable auction proceeds. If auction proceeds are less than the guaranteed amount, our commission will be
reduced, and we could potentially incur a loss, and, if auction proceeds are less than the purchase price, we paid for equipment that we take into inventory
temporarily, we will incur a loss. Because a majority of our auctions are unreserved, there is no way for us to protect against these types of losses by bidding on
or acquiring any of the items at such auctions. In addition, we do not hold inventory indefinitely waiting for market conditions to improve. If our exposure to
underwritten contracts increases, this risk would be compounded.
Occasionally, we advance to consignors a portion of the estimated auction proceeds prior to the auction. We generally make these advances only after taking
possession of the assets to be auctioned and upon receipt of a security interest in the assets to secure the obligation. If we were unable to auction the assets or if
auction proceeds were less than amounts advanced, we could incur a loss. Additionally, we have two vendor contracts with the U.S. Government’s Defense
Logistics Agency (“DLA”) pursuant to which we acquire, manage and resell certain assets of the DLA. Each of the DLA contracts obliges the Company to
purchase rolling and non-rolling stock assets in an amount and of a type over which we have limited ability to control. In many cases, the type of assets
purchased are not what we typically sell through any of our other channels. Although the prices we pay for the non-rolling stock inventory are a fraction of the
original acquisition value, we may not have the ability to attract buyers for those assets and we may be unable to sell those assets on a timely basis or at all.
This would have an adverse effect on our financial results.
The availability and performance of our IT systems and infrastructure is critical to our business and continued growth.
The satisfactory performance, reliability and availability of our websites, online bidding service, auction management systems, enterprise resource planning
systems, transaction processing systems, network infrastructure and customer relationship management systems are important to our reputation, our business
and our continued growth. We currently rely on our own proprietary systems, licensed on-premise systems, and third-party cloud computing applications and
infrastructure located in the United States and other countries. The systems and infrastructure we rely on may experience service interruptions or degradation
because of hardware or software defects or malfunctions, denial of service or ransomware attacks and other cybersecurity events, human error and natural
events beyond our control. The rapid evolution and increased adoption of artificial intelligence technologies may intensify our
RB Global, Inc.
17
Table of Contents
cybersecurity risks. Additionally, as part of our management of these IT resources, we integrate, make updates to or initiate other types of changes to our
systems and infrastructure to address ongoing availability and performance concerns or to improve the same, and the risk of disruption is increased when such
changes are undertaken. Some of our systems are not fully redundant, and our recovery planning may not be sufficient for all possible disruptions. Further, the
access to and use of needed hardware and software, including cloud computing resources, may not continue to be available at reasonable prices, on
commercially reasonable terms or at all. Any loss of the right to access or use any of these components and resources, the degraded performance, or loss of the
functionality, of our systems, or a failure to timely or successfully integrate and update our systems or infrastructure, could mean a failure to realize cost
savings or operational benefits anticipated to be derived from an IT initiative, significantly increase our expenses, damage our reputation and otherwise result
in delays in providing our services. Our business and results of operations would be particularly harmed if, for any reason, access to our online bidding service
was lost or its functionality degraded.
Consumer behavior is rapidly changing, and if we are unable to successfully adapt to consumer preferences and develop and maintain a relevant and
reliable inventory management and multichannel disposition experience for our customers, our financial performance and brand image could be adversely
affected.
Our business continues to evolve into a one-stop inventory management and multichannel disposition company where customers can buy, sell, or list
equipment, when, how, and where they choose- both onsite and online, and manage their existing fleets and/or inventory using our online inventory
management tools. As a result of this evolution, increasingly we interact with our customers across a variety of different channels, including live auction,
online, through mobile technologies, including the Ritchie Bros. mobile app, social media, and inventory management systems. Our customers are increasingly
using tablets and mobile phones to make purchases online and to get detailed equipment information for assets that they own or are interested in purchasing.
Our customers also engage with us online, including through social media, by providing feedback and public commentary about all aspects of our business.
Consumer shopping patterns are rapidly changing, and our success depends on our ability to anticipate and implement innovations in customer experience and
logistics in order to appeal to customers who increasingly rely on multiple channels to meet their equipment management and disposition needs. Our ability to
provide a high quality and efficient customer experience is also dependent on external factors over which we may have little or no control, including, without
limitation, the reliability and performance of the equipment sold in our marketplaces and the performance of third-party carriers who transport purchased
equipment on behalf of buyers. If for any reason we are unable to implement our inventory management, data solutions, bidding tools and other multichannel
initiatives, provide a convenient and consistent experience for our customers across all channels, or provide our customers the services they want, when and
where they want them at a compelling value proposition, then our financial performance and brand image could be adversely affected.
We rely on data provided by third parties, the loss of which could limit the functionality of certain of our platforms and disrupt our business.
Our analytics teams rely on asset, pricing and other data, including personal data, provided to us by our customers and other third parties. Some of this data is
provided to us pursuant to third-party data sharing policies and terms of use, under data sharing agreements by third-party providers or by customers with
consent. Any of these parties could change their data sharing policies and terms of use, including by making them more restrictive, terminating or not renewing
agreements, or, customers could revoke their consent, any of which could result in the loss of, or significant impairment to, our ability to collect and provide
useful data or related services to our customers.
These third parties could also interpret our data collection and use policies or practices as being inconsistent with their policies or business objectives or lose
confidence in our data protection and privacy practices, which could result in the loss of our ability to collect this data. Any such changes could impair our
ability to deliver our analytics service to our customers in the manner currently anticipated or at all, impairing the return on investment that our customers
derive from using our analytics platform and related products, as well as adversely affecting our business and our ability to generate revenue.
Government regulation of the digital landscape is evolving, and unfavorable regulations could substantially harm our business and results of operations.
We are subject to federal, provincial, state and local laws, rules and regulations governing digital commerce and online services. Existing and future laws and
regulations may impede the growth of digital commerce or other services, in particular online marketplace services, and increase the cost of doing business,
including providing online disposition services. These regulations and laws may cover taxation, tariffs, user privacy, data protection, machine learning and
automated decision making, pricing, transaction processing, content, intellectual property rights, electronic contracts, digital marketing communications,
consumer protection, and the characteristics and quality of our disposition services. It is not always clear how existing laws governing issues such as property
transfers, digital, sales and similar taxes, intellectual property rights, and user privacy and data protection apply to digital commerce
RB Global, Inc.
18
Table of Contents
and online services. Changes to laws, rules and regulations and unfavorable resolution of these issues may harm our business and results of operations.
If our ability, or the ability of our third party service partners, cloud computing providers or third party data center hosting facilities, to safeguard the
reliability, integrity and confidentiality of our and their IT systems is compromised, if unauthorized access is obtained to our systems or customers’,
suppliers', counterparties' and employees' confidential information, or if authorized access is blocked or disabled, we may incur material reputational
harm, legal exposure, or a negative financial impact.
We rely on IT resources to manage and operate our business, including maintaining proprietary databases containing sensitive and confidential information
about our customers, suppliers, counterparties and employees (which may include personal information and credit information) and utilizing approved third-
party technology providers to support the management and operation of IT systems and infrastructure. The malicious tools and techniques used to obtain
unauthorized access to or impair IT systems and devices and the data processed thereby evolve frequently in terms of attack vectors and sophistication and we
may not be able to anticipate these vectors or to timely implement adequate preventative and protective measures. Unauthorized parties have and may in the
future attempt to gain access to our and our providers’ primary and backup systems or facilities through various means, including hacking into IT systems or
facilities, fraud, trickery or other means of deceiving our and their employees or contractors. Ransomware attacks are increasingly prevalent and severe, and
can lead to significant interruptions in our operations, loss of data and income, reputational loss, and diversion of funds. Further, breaches experienced by other
companies may also be leveraged against us and sophisticated actors can mask their attacks, making them increasingly difficult to identify and prevent. There
can be no assurance that impacts from these incidents will not be material or significant in the future.
In addition, our limited control over our customers may affect the security and integrity of our IT systems and create financial, reputational or legal exposure.
For example, our customers may accidentally disclose their passwords, use insecure passwords, or store them on a device that is lost or stolen, providing bad
actors with access to a customer’s account with us and the possible means to redirect customer payments. Further, users of our services could have
vulnerabilities on their own devices that are entirely unrelated to our systems and platforms but could mistakenly attribute their own vulnerabilities to us. Under
credit card payment rules and our contracts with credit card processors, if there is a breach of payment card information used to process transactions, we could
be liable to the payment card issuing banks for certain fraudulent credit card transactions and other payment disputes with customers, including the cost of
issuing new cards and related expenses. If we were liable for a significant number of fraudulent transactions or unable to accept payment cards, our results of
operations would be materially and adversely affected. Bad actors may also create fake websites or misleading communications that mimic our branding,
product offerings, or invoicing systems, thereby deceiving customers into making purchases that they believe are legitimate. Such fraudulent activities could
significantly damage our reputation, erode customer trust, and result in financial losses. Furthermore, the complex, global and fragmented nature of the internet
ecosystem, including multiple domain registrars, hosting services, and internet service providers, can make it extremely difficult and time-consuming to
identify and take down fraudulent websites or other misleading content, leaving our brand vulnerable to continued exploitation by malicious actors. This risk is
heightened in foreign jurisdictions where we may have less influence over local enforcement mechanisms, or access to rapid legal recourse.
The information security measures we implement, maintain and follow that are designed to mitigate our risks with respect to IT-related cybersecurity incidents
do not guarantee that our operations will not be disrupted, that we will prevent an attack from occurring in the future, or that our internal controls, for instance
relating to user access management, will perform as intended to prevent unauthorized access to our systems and data. We continue to integrate and align
security measures and internal controls across our operating businesses. These businesses are at varying stages of maturity, which presents challenges in
standardizing security measures across the organization. Inconsistent or incomplete alignment of security measures could lead to vulnerabilities, compliance
risks, or operational disruptions. Gaps or delays in our ongoing efforts to align these measures could impact the effectiveness of our overall security posture
and expose us to potential security breaches. Any breach of our IT systems may have a material adverse impact on our business, the assessment of the
performance of our internal control environment, results of operations, reputation, stock price and our ability to access capital markets, and may also be
deemed to contribute to a material weakness in internal controls over financial reporting.
Security events, hacking or other malicious or surreptitious activity (or the perception that such activities have occurred), could damage our reputation, cause a
loss of confidence in the security of our services and thereby a loss of customers, and expose us to a risk of loss, governmental investigations and enforcement
actions or litigation and possible liability for damages. We may be required to make significant expenditures and divert management attention to monitor,
detect and prevent security events, to remediate known or potential security vulnerabilities, or to alleviate problems caused by any security events. In addition,
circumvention of our security measures may result in the loss or misappropriation of valuable business data, intellectual property or trade secret information,
misappropriation of our customers’ or employees’ personal information, damage to our computing infrastructure, networks and stored data, service delays, key
personnel being unable to perform duties or communicate throughout the organization, loss of sales, significant costs for data restoration and other adverse
impacts on our business. Further, such a breach may require us to incur significant expenses to notify governmental agencies, individuals or other third parties
pursuant to various privacy and security laws.
RB Global, Inc.
19
Table of Contents
The costs of mitigating cybersecurity risks are significant and are likely to increase in the future. Our third-party service providers may be vulnerable to
interruption or loss of valuable business data and information of our customers and employees (among others). Data stored by our third-party providers might
be improperly accessed or unavailable due to a variety of events beyond our control, including, but not limited to, employee error or negligence, natural
disasters, terrorist attacks, telecommunications failures, computer viruses, hackers and other security issues. Additionally, if any of our third-party technology
providers violate applicable laws or our contracts or policies, such violations may also put our customers’ information at risk and could in turn have a material
and adverse effect on our business. Our insurance policies may not be adequate to reimburse us for losses caused by security breaches, and we may not be able
to fully collect, if at all, under these insurance policies.
Our future expenses may increase significantly and our operations and ability to expand may be limited as a result of licenses, laws and regulations
governing auction sites, environmental protection, international trade, tariffs and other matters.
A variety of federal, provincial, state and local laws, rules and regulations throughout the world apply to our business, relating to, among other things, tax and
accounting rules, the auction business, imports and exports of equipment, property ownership laws, licensing, worker safety, privacy and security of customer
information, land use and the use, storage, discharge and disposal of environmentally sensitive materials. Complying with revisions to laws, rules and
regulations could result in an increase in expenses and a deterioration of our financial performance. Failure to comply with applicable laws, rules and
regulations could result in substantial liability to us, suspension or cessation of some or all of our operations, restrictions on our ability to expand at present
locations or into new locations, requirements for the acquisition of additional equipment or other significant expenses or restrictions.
The development or expansion of auction sites depends upon receipt of required licenses, permits and other governmental authorizations. Our inability to
obtain these required items could harm our business. Additionally, changes or concessions required by regulatory authorities could result in significant delays
in, or prevent completion of, such development or expansion. International bidders and consignors could be deterred from participating in our auctions if
governmental bodies impose additional export or import regulations or additional duties, taxes or other charges on exports or imports. The United States and
other countries have imposed and may continue to impose new trade restrictions and export regulations, have levied tariffs and taxes on certain assets, and
could significantly increase tariffs on a broad array of assets. Trade restrictions and export regulations, or increases in tariffs and additional taxes, including any
retaliatory measures, could reduce participation from international bidders and consignors which could reduce GTV and harm our business, financial condition
and results of operations.
Under some environmental laws, an owner, operator or lessee of, or other person involved in, real estate may be liable for the costs of removal or remediation
of hazardous or toxic substances located on or in, or emanating from, the real estate, and related costs of investigation and property damage. These laws often
impose liability without regard to whether the owner, operator, lessee or other person knew of, or was responsible for, the presence of the hazardous or toxic
substances. Environmental contamination may exist at our owned or leased auction sites, or at other sites on which we may conduct auctions, or properties that
we may be selling by auction, from prior activities at these locations or from neighboring properties. In addition, auction sites that we acquire or lease in the
future may be contaminated, and future use of or conditions on any of our properties or sites could result in contamination. The costs related to claims arising
from environmental contamination of any of these properties could harm our financial condition and results of operations.
There are restrictions in the United States, Canada, Europe and other jurisdictions in which we do business that may affect the ability of equipment owners to
transport certain equipment between specified jurisdictions or the salability of older equipment. One example of these restrictions is environmental certification
requirements in the United States, which prevent non-certified equipment from entering into commerce in the United States. In addition, engine emission
standards in some jurisdictions limit the operation of certain trucks and equipment in those markets.
These restrictions, or the adoption of more stringent environmental laws, including laws enacted in response to climate change, could inhibit materially the
ability of customers to ship equipment to or from our auction sites, reducing our GTV and harming our business, financial condition and results of operations.
Losing the services of one or more key personnel or the failure to attract, train and retain personnel could materially affect our business.
Our future success largely depends on our ability to attract, develop and retain skilled employees in all areas of our business, as well as to design an appropriate
organization structure and plan effectively for succession. Although we actively manage our human resource risks, there can be no assurance that we will be
successful in our efforts. If we fail to attract, develop and retain skilled employees in all areas of our business, our financial condition and results of operations
may be adversely affected, and we may not achieve our growth or performance objectives.
The growth and performance of our business depends to a significant extent on the efforts and abilities of our employees. Many of our key employees have
extensive experience with our business. These employees have knowledge and an understanding of our company
RB Global, Inc.
20
Table of Contents
and industry that cannot be readily duplicated. The loss of any key personnel, or the inability to replace any lost personnel with equally trained personnel, could
impair our ability to execute our business plan and growth strategy, cause us to lose customers and reduce our revenues. In addition, the success of our strategic
initiatives to expand our business to complimentary service offerings will require new competencies in many positions, and our management and employees
will have to adapt and learn new skills and capabilities. To the extent they are unable or unwilling to make these transformational changes or we are unable to
attract new employees who are able to do so, we may be unable to realize the full benefits of our strategic initiatives. We do not maintain key person insurance
on the lives of any of our executive officers or other key personnel. As a result, we would have no way to cover the financial loss if we were to lose the services
of such employees. This uncertainty may adversely affect our ability to attract and retain key employees.
If any of our key personnel were to join a competitor or form a competing company, existing and potential customers could choose to form business
relationships with that competitor instead of us. There can be no assurance that confidentiality, non-solicitation, non-competition or similar agreements signed
by our former directors, officers, or employees will be effective in preventing a loss of business.
Failure to maintain safe sites could materially affect our business and reputation.
Our employees and customers are often in close proximity with mechanized equipment, moving vehicles and chemical and other industrial substances. Our
auction sites and warehouses are, therefore, potentially dangerous places and involve the risk of accidents, environmental incidents and other incidents, which
may expose us to investigations and litigation or could negatively affect the perception of customer and employee safety, health and security. Even in the
absence of any incidents, unsafe site conditions could lead to employee turnover or harm our reputation generally, each of which would affect our financial
performance. While safety is a primary focus of our business and is critical to our reputation and performance, our failure to implement safety procedures or
implement ineffective safety procedures would increase this risk and our operations and results from operations may be adversely impacted.
Income and commodity tax amounts, including tax expense, may be materially different than expected, and there is a trend by global tax collection
authorities towards the adoption of more aggressive laws, regulations, interpretations and audit practices.
Our global operations are subject to tax interpretations, regulations, and legislation in the numerous jurisdictions in which we operate, all of which are subject
to continual change.
We accrue and pay income taxes and have significant income tax assets, liabilities, and expense that are estimates based primarily on the application of those
interpretations, regulations and legislation, and the amount and timing of future taxable income, as well as our use of applicable accounting principles.
Accordingly, we cannot be certain that our estimates and reserves are sufficient. The timing concerning the monetization of deferred income tax amounts is
uncertain, as they are dependent on our future earnings and other events. Our deferred income tax amounts are valued based upon enacted income tax rates in
effect at the time, which can be changed by governments in the future.
The audit and review activities of tax authorities affect the ultimate determination of the actual amounts of commodity taxes payable or receivable, income
taxes payable or receivable, deferred income tax assets and liabilities, and income tax expense.
There is no assurance that taxes will be payable as anticipated or that the amount or timing of receipt or use of the tax-related assets will be as currently
expected. Our experience indicates that taxation authorities are increasing the frequency and depth of audits and reviews. The Canada Revenue Agency
(“CRA”) has been conducting audits for our 2014, 2015, 2020 and 2021 taxation years.
On December 3, 2024, the CRA issued the Company a Notice of Assessment and Statement of Interest (“NOA”) for CA$79.1 million (Canadian dollars)
(approximately $55.1 million), for the taxation years 2010 through 2015, inclusive of CA$37.7 million in income taxes (approximately $26.3 million), and
CA$41.4 million in interest and penalties (approximately $28.9 million). The CRA is asserting that one of the Company’s Luxembourg subsidiaries which was
in operation from 2010 to 2020 was a resident in Canada from 2010 through 2015 and that its worldwide income should be subject to Canadian income
taxation. The Company plans to object to the notice of assessment as it believes it is and has been in full compliance with Canadian tax laws and intends to
pursue all available administrative and judicial remedies necessary to resolve this matter. As such, the Company plans to file a Notice of Objection with the
CRA in March 2025 and accordingly has paid a deposit of CA$39.5 million (approximately $27.6 million) to the CRA in February 2025, the minimum required
by law as part of the CRA’s objection process. In the event that the Company prevails in its objection or subsequent legal proceedings, the deposit would be
refunded with interest to the Company. In the event that the Company’s tax filing position is not upheld by either the CRA or by a court of last resort, the
Company would incur and record the amounts assessed in income tax, interest and penalties in its consolidated financial statements, which could have a
material negative effect on the Company’s operations. In addition, during the third quarter of 2024, the CRA has requested information regarding the 2016 to
2020 taxation years for the same matter, which the Company provided to the CRA in January 2025. The Company has not received a notice of assessment
relating to the 2016 to 2020 taxation years. Depending on the outcome of this matter with the CRA, the Company could incur additional income taxes,
penalties and interest relating to the 2016 to 2020 taxation years, which could have
RB Global, Inc.
21
Table of Contents
a material negative effect on its operations. In addition, future tax authority determinations, including changes to tax interpretations, regulations, legislation or
jurisprudence, could have a material impact to our financial position. The fact that we operate internationally increases our exposure in this regard given the
multiple forms of taxation imposed upon us. Further and more generally, there has been increased political, media and tax authority focus on taxation in recent
years; the intent of which appears to be to enhance transparency and address perceived tax avoidance. As such, in addition to tax risk from a financial
perspective, our activities may expose us to reputational risk.
Our substantial international operations expose us to additional risks that could harm our business, including foreign exchange rate fluctuations that
could harm our results of operations.
We conduct business in many countries around the world and intend to continue to expand our presence in international markets, including emerging markets.
Although we report our financial results in U.S. dollars, a significant portion of our revenues and expenses are generated outside the U.S., primarily in
currencies other than the U.S. dollar. In particular, a significant portion of our revenues are earned, and expenses incurred, in the Canadian dollar and the Euro.
The results of operations of our foreign subsidiaries are translated from local currency into U.S. dollars for financial reporting purposes. If the U.S. dollar
weakens against foreign currencies, the translation of these foreign currency denominated revenues or expenses will result in increased U.S. dollar
denominated revenues and expenses. Similarly, if the U.S. dollar strengthens against foreign currencies, particularly the Canadian dollar and the Euro, our
translation of foreign currency denominated revenues or expenses will result in lower U.S. dollar denominated revenues and expenses. We do not currently
engage in foreign currency hedging arrangements on any of our revenues or expenses. Fluctuating currency exchange rates may negatively affect our business
in international markets and our related results of operations.
In addition, currency exchange rate fluctuations between the different countries in which we conduct our operations impact the purchasing power of buyers, the
motivation of consignors, asset values and asset flows between various countries, including those in which we do not have operations. These factors and other
global economic conditions may harm our business and our results of operations.
Other risks inherent in doing business internationally include, but are not limited to the following: (a) trade barriers, trade regulations, currency controls, import
or export regulations, tariffs and other restrictions on doing business freely; (b) local labor, environmental, tax, and other laws and regulations, and the potential
for adverse changes in such laws and regulations or the interpretations thereof; (c) difficulties in staffing and managing foreign operations; (d) economic,
political, social or labor instability or unrest; (e) terrorism, war, hostage-taking, or military repression; (f) corruption; (g) expropriation and nationalization, or
difficulties in enforcing or protecting our property rights, including with respect to intellectual property; (h) increased exposure to high rates of inflation; and (i)
unpredictability as to litigation in foreign jurisdictions and enforcement of local laws.
If we violate the complex foreign and U.S. laws and regulations that apply to our international operations, we may face fines, criminal actions or sanctions,
prohibitions on the conduct of our business and damage to our reputation. These risks inherent in our international operations increase our costs of doing
business internationally and may result in a material adverse effect on our operations or profitability.
Our business operations may be subject to a number of federal and local laws, rules and regulations governing international trade, including export
control regulations.
Our business operations may be subject to a number of federal and local laws, rules and regulations, including the Export Administration Regulations, or EAR,
maintained by the U.S. Department of Commerce, economic and trade sanctions maintained by the U.S. Department of the Treasury’s Office of Foreign Assets
Control, or OFAC, and similar laws and regulations in Canada, the UK and the EU. These laws and regulations restrict us from providing services to, or
otherwise engaging in direct or indirect transactions or dealings with, certain countries, territories, governments, and persons. We have implemented procedures
designed to maintain compliance with these laws, including monitoring, on an automatic and manual basis, the identity and location of potential sellers and
buyers. We can offer no assurances that these procedures will always be effective.
If we were to violate applicable export control or sanctions, we could be subject to administrative or criminal penalties, which in certain circumstances, could
be material. We could be subject to damages, financial penalties, denial of export privileges, incarceration of our employees, other restrictions on our
operations, and reputational harm. Further, any action on the part of the U.S. Department of Commerce, OFAC or other applicable regulator against the
company or any of our employees for potential violations of these laws could have a negative impact on our reputation, business, operating results and
prospects.
Failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws, including the U.S. Foreign Corrupt Practices Act of 1977, as
amended, or the FCPA, the Corruption of Foreign Public Officials Act, or the CFPOA, and similar laws associated with our activities outside of the U.S.
could subject us to penalties and other adverse consequences.
We are subject to the FCPA, the CFPOA, the U.S. domestic bribery statute contained in 18 U.S.C. §201, the U.S. Travel Act, the USA
RB Global, Inc.
22
Table of Contents
PATRIOT Act, the United Kingdom Bribery Act of 2010, or the U.K. Bribery Act, and similar other anti-corruption, anti-bribery and anti-money laundering
laws in countries in which we conduct activities or facilitate the buying and selling of equipment, including the EU. We face significant risks if we fail to
comply with the FCPA, the CFPOA and other anti-corruption and anti-bribery laws that prohibit companies and their employees and third-party intermediaries
from authorizing, offering or providing, directly or indirectly, improper payments or benefits to foreign government officials, political parties or candidates,
employees of public international organizations, and private-sector recipients for the corrupt purpose of obtaining or retaining business, directing business to
any person, or securing any advantage. In many foreign countries, particularly in countries with developing economies, it may be a local custom that businesses
engage in practices that are prohibited by the FCPA, the CFPOA or other applicable laws and regulations. In addition, we leverage various third parties to sell
our solutions and conduct our business abroad. We and our other third-party intermediaries may have direct or indirect interactions with officials and
employees of government agencies or state-owned or affiliated entities. We may be held liable for the corrupt or other illegal activities of these third-party
intermediaries, our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize such activities. Our Code of Business
Conduct and Ethics and other corporate policies mandate compliance with these anti-bribery laws, which often carry substantial penalties.
Any violation of the FCPA, other applicable anti-bribery, anti-corruption laws, and anti-money laundering laws could result in whistleblower complaints,
adverse media coverage, investigations, loss of export privileges, severe criminal or civil sanctions and, in the case of the FCPA, suspension or debarment from
U.S. government contracts, which could have a material and adverse effect on our reputation, business, operating results and prospects. In addition, responding
to any enforcement action may result in a materially significant diversion of management’s attention and resources and significant defense costs and other
professional fees.
We are pursuing a long-term growth strategy that may include acquisitions and developing and enhancing an appropriate sales strategy, which requires
upfront investment with no guarantee of long-term returns.
We continue to pursue a long-term growth strategy that contemplates upfront investments, including (i) investments in emerging markets that may not generate
profitable growth in the near term, (ii) adding new business and information solutions, and (iii) developing our people. Planning for future growth requires
investments to be made now in anticipation of growth that may not materialize, and if our strategies do not successfully address the needs of current and
potential customers, we may not be successful in maintaining or growing our GTV and our financial condition and results of operations may be adversely
impacted. We may also not be able to improve our systems and controls as a result of increased costs, technological challenges, or lack of qualified employees.
A large component of our selling, general and administrative expenses is considered fixed costs that we will incur regardless of any GTV growth. There can be
no assurances that our GTV and revenues will be maintained or grow at a more rapid rate than our fixed costs.
Part of our long-term growth strategy includes growth through acquisitions, which poses a number of risks. We may not be successful in identifying appropriate
acquisition candidates, consummating acquisitions on satisfactory terms or integrating any newly acquired or expanded business with our current operations.
Our ability to acquire other businesses or technologies, make strategic investments or integrate acquired businesses effectively may also be impaired by adverse
economic and political events, including trade tensions, and increased global scrutiny and evolving regulatory expectations relating to acquisitions and strategic
investments. Additionally, significant costs may be incurred in connection with any acquisition and our integration of such businesses with our business,
including legal, accounting, financial advisory and other costs. We may also not realize the anticipated benefits of, and synergies from, such acquisition. We
cannot guarantee that any future business acquisitions will be pursued, that any acquisitions that are pursued will be consummated, or that we will achieve the
anticipated benefits of completed acquisitions.
We are regularly subject to general litigation and other claims, which could have an adverse effect on our business and results of operations.
We are subject to general litigation and other claims that arise in the ordinary course of our business. The outcome and impact of such litigation cannot be
predicted with certainty, but regardless of the outcome, these proceedings can have an adverse impact on us because of legal costs, diversion of management
resources and other factors. While the results of these claims have not historically had a material effect on us, we may not be able to defend ourselves
adequately against these claims in the future, and these proceedings may have a material adverse impact on our financial condition or results of operations.
Additionally, the outcome of a proceeding may differ materially from the Company's best estimate. For example, we currently have an ongoing dispute with
Ms. Ann Fandozzi, former Chief Executive Officer, and current Director, regarding her departure from the Company. Since the third quarter of 2023, the
Company has been recording an accrual to reflect the best estimate of the settlement amount, and to date has recorded an expense of $11.2 million, which
reflects the current best estimate of a settlement amount net of a recapture of previously recognized compensation expense based on the terms of Ms.
Fandozzi’s employment agreement following her resignation. The matter is currently in arbitration in accordance with the terms of Ms. Fandozzi’s employment
agreement. Any changes to the estimated payment amount as a result of the settlement of the matter could be material and any such payment or our
RB Global, Inc.
23
Table of Contents
inability to resolve the dispute in a timely manner may adversely affect our results of operations. See "Part II, Item 8: Financial Statements and Supplementary
Data - Note 27 Contingencies" for further information.
We may also be subject to intellectual property claims, which are extremely costly to defend, could require us to pay significant damages, and could limit our
ability to use certain technologies in the future. Companies in the internet and technology industries are frequently subject to litigation based on allegations of
infringement or other violations of intellectual property rights.
Third-party intellectual property rights may cover significant aspects of our technologies or business methods or block us from expanding our offerings. Any
intellectual property claim against us, with or without merit, could be time consuming and expensive to settle or litigate and could divert the attention of our
management. Litigation regarding intellectual property rights is inherently uncertain due to the complex issues involved, and we may not be successful in
defending ourselves in such matters.
Many potential litigants, including some patent-holding companies, have the ability to dedicate substantial resources to enforcing their intellectual property
rights. Any claims successfully brought against us could subject us to significant liability for damages, and we may be required to stop using technology or
other intellectual property alleged to be in violation of a third party’s rights. We also might be required to seek a license for third-party intellectual property.
Such a license may be unavailable or may require us to pay significant royalties or submit to unreasonable terms, which would increase our operating expenses.
We may also be required to develop alternative non-infringing technology, which could require significant time and expense. If we cannot license or develop
technology for any allegedly infringing aspect of our business, we would be forced to limit our service and may be unable to compete effectively. Any of these
results could harm our business.
Privacy concerns and our compliance with current and evolving domestic or foreign laws and regulations regarding the processing of personal
information and other data may increase our costs, impact our marketing efforts, or decrease adoption and use of our products and services, and our
failure to comply with those laws and regulations may expose us to liability and reputational harm.
Governments and regulators around the world continue to propose and adopt new, or modify existing, laws, regulations and interpretative guidance addressing
data privacy, data protection, data sovereignty and the processing of data, generally. Although we monitor the regulatory environment and have invested in
addressing these developments, such as through our cybersecurity and privacy readiness programs, these laws may require us to incur further compliance costs
to make changes to our practices, products and services to enable us or our customers to meet the new legal requirements. In addition, if we are found to have
breached any such laws or regulations, we may be subject to enforcement actions that require us to change our practices, products and services, which may
negatively impact our revenue, as well as expose us to liability through new or higher potential penalties and fines for non-compliance, civil and criminal
penalties, and litigation for alleged violations, as well as adverse publicity that could cause our customers to lose trust in us and negatively impact our
reputation and business in a manner that harms our financial position. These new or proposed laws and regulations are subject to differing interpretations that
may change over time resulting in further compliance costs, as well as diversion of resources to monitor and address developments. New and proposed laws
and regulations may also be inconsistent among jurisdictions or conflict with other laws and regulations. As a result, these requirements and other potential
self-regulatory standards and industry codes of conduct could require us to take on more onerous obligations in our contracts, restrict our ability to store,
transfer and otherwise process data or, in some cases, impact our ability to offer certain services in certain locations, to deploy software or data solutions, to
market to current and prospective customers, or to derive insights from customers’ online activity and data globally.
We believe that laws and regulations in the United States, Canada, the United Kingdom, Australia the European Union and in other jurisdictions will be
increasingly restrictive in the field of data privacy and protection and will in turn result in an increase in regulatory burdens for us to address to continue
meeting our customers’ expectations, in particular in relation to the sharing of personal information with third parties, the use of machine learning and big data,
and the tracking of online activities for advertising. As our capacity to process large volumes of data increases, customer sentiment towards increased
transparency and control and further interpretive guidance from regulatory agencies may require us to change our operations and practices in a manner adverse
to our business. In this uncertain and shifting regulatory and trust climate, even the perception that the privacy and security of personal information are not
satisfactorily addressed or do not meet regulatory requirements could result in adverse publicity and reputation loss.
Our business continuity plan may not operate effectively in the event of a significant interruption of our business.
We have implemented a formal business continuity plan covering most significant aspects of our business that would take effect in the event of a significant
interruption to our business, or the loss of key systems as a result of a natural or other disaster. Although we have tested our business continuity plan as part of
the implementation, there can be no assurance that it will operate effectively or that our business, results of operations and financial condition will not be
materially affected in the event of a significant interruption of our
RB Global, Inc.
24
Table of Contents
business. If we were subject to a disaster or serious security breach, it could materially damage our business, financial condition and results of operations.
Our insurance may be insufficient to cover losses that may occur as a result of our operations.
We maintain property and general liability insurance. This insurance may not remain available to us at commercially reasonable rates, and the amount of our
coverage may not be adequate to cover all liabilities that we may incur. Our auctions generally involve the operation of large equipment close to a large number
of people, and despite our focus on safe work practices, an accident could damage our facilities, injure auction attendees and harm our reputation and our
business. In addition, if we were held liable for amounts exceeding the limits of our insurance coverage or for claims outside the scope of our coverage, the
resulting costs could harm our financial condition and results of operations.
Certain global conditions may affect our ability to conduct successful events.
Like most businesses with global operations, we are subject to the risk of certain global or regional adverse conditions, such as pandemics or other disease
outbreaks, or natural disasters including extreme weather or other events, such as hurricanes, tornadoes, earthquakes, forest fires or floods that could hinder our
ability to conduct our scheduled auctions, restrict our customers’ travel patterns or their desire to attend auctions or impact our online operations, including
disrupting the internet or mobile networks or one or more of our service providers. If any of these conditions were to occur, we may not be able to generate
sufficient equipment consignments to sustain our business or to attract enough bidders to our auctions to achieve world fair market values for the items we sell.
This could harm our financial condition and results of operations. To the extent that climate change causes rising sea levels, increased intensity of weather, and
increased frequency of extreme precipitation and flooding, the risks noted above may increase.
Financial Risk Factors
Ineffective internal control over financial reporting could result in errors in our financial statements, reduce investor confidence, and adversely impact our
stock price.
As a public company, we are required to furnish a report by management on the effectiveness of our internal control over financial reporting. This assessment is
required to include disclosure of any material weaknesses identified by our management in our internal control over financial reporting identified by our
management. We are also required to have our independent registered public accounting firm issue an opinion on the effectiveness of our internal control over
financial reporting on an annual basis.
Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition or results of
operations. If we are unable to conclude in the future that our internal control over financial reporting is effective, or if our independent registered public
accounting firm determines we have a material weakness in our internal control over financial reporting, we could lose investor confidence in the accuracy and
completeness of our financial reports, our stock price could decline, and we could be subject to sanctions or investigations by the New York Stock Exchange,
the SEC or other regulatory authorities. Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain
other effective control systems required of public companies, could also restrict our future access to the capital markets.
We have substantial indebtedness, and the degree to which we are leveraged may materially and adversely affect our business, financial condition and
results of operations.
At December 31, 2024, we have $2.7 billion of total debt outstanding, consisting of:
•
$1.3 billion under an amended credit agreement (the "Credit Agreement") entered into in December 2022 with a syndicate of lenders; and
•
$550.0 million aggregate principal amount of 6.750% senior secured notes due March 15, 2028, and $800.0 million aggregate principal amount of
7.750% senior unsecured notes due March 15, 2031 (together the "Notes")
There are no current drawings under our foreign credit facilities, and we can borrow an additional $705.9 million under the Credit Agreement.
Our ability to make payments on and to refinance our indebtedness, as well as any future debt that we may incur, will depend on our ability to generate cash in
the future from operations, financings or asset sales. Our ability to generate cash is subject to general economic, financial, competitive, legislative, regulatory
and other factors that are beyond our control. We may not generate sufficient funds to service our debt and meet our business needs, such as funding working
capital or the expansion of our operations. If we are not able to repay or refinance our debt as it becomes due, we may be forced to take certain actions,
including reducing spending on marketing, advertising and new product innovation, reducing future financing for working capital, capital expenditures and
general corporate purposes, selling assets or dedicating an unsustainable level of our cash flow from operations to the payment of principal and interest on our
indebtedness. In addition, our ability to withstand competitive pressures and to react to changes in our industry, including both the live and online auction
industry, could be impaired.
RB Global, Inc.
25
Table of Contents
The lenders who hold our debt could also accelerate amounts due in the event that we default, which could potentially trigger a default or acceleration of the
maturity of our other debt. In addition, our leverage could put us at a competitive disadvantage compared to our competitors that are less leveraged. These
competitors could have greater financial flexibility to pursue strategic acquisitions and secure additional financing for their operations. Our leverage could also
impede our ability to withstand downturns in our industry or the economy in general. We may incur substantial additional indebtedness in the future. The terms
of the Credit Agreement and the indentures governing the Notes will limit, but not prohibit, us from incurring additional indebtedness. If we incur any
additional indebtedness that has the same priority as the Notes and the guarantees thereof, the holders of that indebtedness will be entitled to share ratably with
the holders of the Notes and the guarantees thereof in any proceeds distributed in connection with any insolvency, liquidation, reorganization, dissolution or
other winding-up of the Company. Subject to restrictions in the Credit Agreement and the indenture governing the Notes, we also will have the ability to incur
additional secured indebtedness that would be effectively senior to the Notes offered hereby, to the extent of the value of the assets securing such obligations. If
new indebtedness is added to our current debt levels, the related risks that we now face could intensify.
Our debt instruments have restrictive covenants that could limit our financial flexibility.
The terms of the Credit Agreement and the Notes indentures contain financial and other restrictive covenants that limit our ability to engage in activities that
may be in our long-term best interests. Our ability to borrow under our Credit Agreement is subject to compliance with a consolidated leverage ratio covenant
and a consolidated interest coverage ratio covenant.
The Credit Agreement includes other restrictions that limit our ability in certain circumstances to: incur indebtedness; grant liens; engage in mergers,
consolidations and liquidations; make asset dispositions, restricted payments and investments; enter into transactions with affiliates; and amend, modify or
prepay certain indebtedness. The indentures governing the Notes contain covenants that limit our ability in certain circumstances to: incur additional
indebtedness (including guarantees thereof); incur or create liens on their assets securing indebtedness; make certain restricted payments; make certain
investments; dispose of certain assets; allow certain restrictions on the ability of our restricted subsidiaries to pay dividends or make other payments to us;
engage in certain transactions with affiliates; and consolidate, amalgamate or merge with or into other companies.
Our failure to comply with these covenants could result in an event of default that, if not cured or waived, could result in the acceleration of substantially all of
our funded debt. We do not have sufficient working capital to satisfy our debt obligations in the event of an acceleration of all or a significant portion of our
outstanding indebtedness.
Risks Related to Our Intellectual Property
We may be unable to adequately protect or enforce our intellectual property rights, which could harm our reputation and adversely affect our growth
prospects.
We regard our proprietary technologies and intellectual property as integral to our success. We protect our proprietary technology through a combination of
trade secrets, third-party confidentiality and nondisclosure agreements, additional contractual restrictions on disclosure and use, and patent, copyright, and
trademark laws.
We are the registered owners of many Internet domain names internationally. As we seek to protect our domain names in an increasing number of jurisdictions,
we may not be successful in doing so in certain jurisdictions. Our competitors may adopt trade names or domain names similar to ours, thereby impeding our
ability to promote our marketplace and possibly leading to customer confusion. In addition, we could face trade name or trademark or service mark
infringement claims brought by owners of other registered or unregistered trademarks or service marks, including trademarks or service marks that may
incorporate variations of our brand names. The legal means we use to protect our proprietary technology and intellectual property do not afford complete
protection and may not adequately protect our rights or permit us to gain or keep any competitive advantage. We cannot guarantee that: any of our present or
future intellectual property rights will not lapse or be invalidated, circumvented, challenged or abandoned; our intellectual property rights will provide
competitive advantages to us; our ability to assert our intellectual property rights against potential competitors or to settle current or future disputes will not be
limited by our agreements with third parties; any of our pending or future patent applications will be issued or have the coverage originally sought; or our
intellectual property rights will be enforced in jurisdictions where competition may be intense or where legal protection may be weak.
We also may allow certain of our registered intellectual property rights, or our pending applications or registrations for intellectual property rights, to lapse or
to become abandoned if we determine that obtaining or maintaining the applicable registered intellectual property rights is not worthwhile. Further, although it
is our practice to enter into confidentiality agreements and intellectual property assignment agreements with our employees and contractors, these agreements
may not be enforceable or may not provide meaningful protection for our trade secrets or other proprietary information in the event of unauthorized use or
disclosure or other breaches of the agreements.
Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy, reverse engineer, or otherwise obtain and use our products or
technology. We cannot be certain that we will be able to prevent unauthorized use of our technology or
RB Global, Inc.
26
Table of Contents
infringement or misappropriation of our intellectual property, particularly in foreign countries where the laws may not protect our proprietary rights. Effective
patent, copyright, trademark, service mark, trade secret, and domain name protection is time-consuming and expensive to maintain. Litigation may be
necessary to enforce our intellectual property rights, to protect our trade secrets, or to determine the validity and scope of the proprietary rights of others, which
could result in substantial costs and diversion of our resources. In addition, our efforts may be met with defenses and counterclaims challenging the validity and
enforceability of our intellectual property rights or may result in a court determining that our intellectual property rights are unenforceable. If we are unable to
cost-effectively protect our intellectual property rights, then our business could be harmed. If competitors are able to use our technology or develop proprietary
technology similar to ours or competing technologies, our ability to compete effectively and our growth prospects could be adversely affected.
Risk Related to Our Industry
Competition could result in reductions in our future revenues and profitability.
The global used equipment market, including the auction segment of that market, is highly fragmented. We compete for potential purchasers and sellers of
equipment with other auction companies and with non-auction competitors such as equipment manufacturers, distributors and dealers, equipment rental
companies, and other online marketplaces. When sourcing equipment to sell at our auctions or other marketplaces, we compete with other onsite and online
auction companies, OEM and independent dealers, equipment brokers, other third parties, and equipment owners that have traditionally disposed of equipment
in private sales.
Some of our competitors have significantly greater financial and marketing resources and name recognition than we do. New competitors with greater financial
and other resources and/or different business models/strategies may enter the equipment auction market in the future. Additionally, existing or future
competitors may succeed in entering and establishing successful operations in new geographic markets prior to our entry into those markets. They may also
compete against us through internet-based services and other combined service offerings.
If commission rates decline, or if our strategy to compete against our many competitors is not effective, our revenues, market share, financial condition and
results of operations may be adversely impacted. We may be susceptible to loss of business if competing selling models become more appealing to customers.
If our selling model becomes undesirable or we are not successful in adding services complementary to our existing selling model and business, we may not be
successful increasing market penetration over the long-term, which could prevent us from achieving our long-term earnings growth targets.
Decreases in the supply of, demand for, or market values of used equipment, could harm our business.
Our revenues could decrease if there is significant erosion in the supply of, demand for, or market values of used equipment, which could adversely affect our
financial condition and results of operations. We have no control over any of the factors that affect the supply of or demand for used equipment and the
circumstances that cause market values for equipment to fluctuate including, among other things, economic uncertainty, the global geopolitical climate,
disruptions to credit and financial markets, lower commodity prices, and our customers’ restricted access to capital. Recent economic conditions have caused
fluctuations in the supply, mix and market values of used equipment available for sale, which has a direct impact on our revenues.
In addition, price competition and the availability of equipment directly affect the supply of, demand for, and market value of used equipment. Climate change
initiatives, including significant changes to engine emission standards applicable to equipment, may also adversely affect the supply of demand for our market
values of equipment.
Risk Related to Our Organization and Governance
Our articles, by-laws, shareholder rights plan and applicable Canadian provincial and federal law contain provisions that may have the effect of delaying
or preventing a change in control.
Certain provisions of our articles of continuance and by-laws, as well as certain provisions of the Business Corporations Act (Ontario) (the “OBCA”) and
applicable Canadian securities law, could discourage potential acquisition proposals, delay or prevent a change in control or materially adversely impact the
price that certain investors might be willing to pay for our common shares. For instance, our articles of continuance authorize our board of directors to
determine the designations, rights and restrictions to be attached to, and to issue an unlimited number of, junior preferred shares and senior preferred shares. In
addition, our by-laws contain provisions establishing that shareholders must give advance notice to us in circumstances where nominations of persons for
election to our board of directors are made by our shareholders other than pursuant to either a requisition of a meeting made in accordance with the provisions
of the OBCA or a shareholder proposal made in accordance with the provisions of the OBCA. Among other things, these advance notice provisions set a
deadline by which shareholders must notify us in writing of an intention to nominate directors for
RB Global, Inc.
27
Table of Contents
election to the board of directors prior to any shareholder meeting at which directors are to be elected and set forth the information required in this notice for it
to be valid.
Our board of directors has adopted a shareholder rights plan (the “Rights Plan”), pursuant to which we issued one right in respect of each common share
outstanding. Under the Rights Plan, following a transaction in which any person becomes an “acquiring person” as defined in the Rights Plan, each right will
entitle the holder to receive a number of common shares provided in the Rights Plan. The purposes of the Rights Plan are (i) to provide our board of directors
time to consider value-enhancing alternatives to a take-over bid and to allow competing bids to emerge; (ii) to ensure that shareholders are provided equal
treatment under a take-over bid; and (iii) to give adequate time for shareholders to properly assess a take-over bid without undue pressure. The Rights Plan can
potentially impose a significant penalty on any person commencing a takeover bid that would result in the offeror becoming the beneficial owner of 20% or
more of our outstanding common shares.
Any of these provisions, as well as certain provisions of the OBCA and applicable Canadian securities law, may discourage a potential acquirer from proposing
or completing a transaction that may have otherwise presented a premium to our shareholders.
U.S. civil liabilities may not be enforceable against us, our directors, or our officers.
We are governed by the OBCA and a portion of our business is in Canada. Certain of our directors and officers reside outside of the United States, and all or a
substantial portion of their assets, as well as a substantial portion of our assets, are located outside the United States. As a result, it may be difficult for investors
to effect service of process within the United States upon us and such directors and officers or to enforce judgments obtained against us or such persons, in U.S.
courts, in any action, including actions predicated upon the civil liability provisions of U.S. federal securities laws or any other laws of the United States.
Additionally, rights predicated solely upon civil liability provisions of U.S. federal securities laws or any other laws of the United States may not be
enforceable in original actions, or actions to enforce judgments obtained in U.S. courts, brought in Canadian courts, including courts in the Province of British
Columbia.
We are governed by the corporate laws of Ontario, Canada which in some cases have a different effect on shareholders than the corporate laws of
Delaware.
We are governed by the OBCA and other relevant laws, which may affect the rights of shareholders differently than those of a company governed by the laws
of a U.S. jurisdiction, and may, together with our charter documents, have the effect of delaying, deferring or discouraging another party from acquiring control
of our company by means of a tender offer, a proxy contest or otherwise, or may affect the price an acquiring party would be willing to offer in such an
instance.
ITEM 1B: UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 1C: CYBERSECURITY
Risk Management & Strategy
RB Global recognizes the critical importance of assessing, identifying and managing material risks to our business associated with cybersecurity threats and
incidents. Cybersecurity risks are identified through various means, including internal assessments of IT initiatives and systems, cybersecurity assessments of
third party providers, penetration testing using third party tools and techniques to test technical controls, vulnerability identification and management
procedures, and monitoring emerging threat intelligence, as well as emerging laws and regulations. Our strategy to manage cybersecurity risk prioritizes threat
prevention, as well as resiliency through established defense, detection and response mechanisms and processes. These mechanisms and processes include risk-
based technical security controls, policy enforcement mechanisms, alert monitoring and other security tools (such as our security incident event management
platform, which provides a centralized view of all alerts within our information systems environment), incident tracking and management (for both internal
events and those reported by third party providers), employee training, and contractual arrangements with third parties that provide cybersecurity risk
management services. Through these processes, we regularly monitor the efficacy of our protection, detection and response mechanisms to cybersecurity
threats and implement changes as appropriate. Key metrics in relation to such monitoring include detection and remediation of incidents, vulnerability
reporting and patching, detecting and takedowns relating to digital fraud, and outcomes of our phishing simulations. We continue to integrate our cybersecurity
practices into our Enterprise Risk Management program, overseen by the Enterprise Risk Management Committee, which identifies and tracks cyber-related
business and compliance risks across the Company and helps prioritize related activity for the internal audit team.
RB Global, Inc.
28
Table of Contents
Additionally, management has established two cross-functional committees made up of appropriate personnel throughout the Company, the Data Privacy
Committee ("DPC") and the Security Steering Committee ("SSC"), to frame, review and guide our processes. The SSC is comprised of our Chief Technology
Officer ("CTO"), our Chief Information Security Officer ("CISO"), and other IT leaders, as well as representatives from Risk Management, Product
Management, Human Resources and Legal. The DPC is responsible for developing strategies and policies relating to data privacy and protection and the SSC
provides a forum for engaging stakeholders on security and risk reduction initiatives, setting security policies and assessing the effectiveness of Company
efforts to monitor, prevent, prevent, and remediate security threats and incidents.
We maintain a comprehensive security program that includes physical, administrative and technical safeguards designed to prevent and timely and
appropriately respond to cybersecurity threats or incidents. We have in the past, and may in the future, also engage third party consultants to assist in assessing,
benchmarking, implementing, monitoring and enhancing our security program. We also continue to invest in dedicated information security resources and
technology to strengthen our programs and controls around people and processes. In the event of a cybersecurity incident, we have established an incident
response and breach management process led by our CISO with the support of leaders from our legal, operations, and risk management departments. We have
retainers with experienced breach coaches in multiple jurisdictions that have been pre-approved by our insurers and a reputable third-party incident response
provider on call as necessary. Cybersecurity incidents, once identified, are evaluated, ranked by severity and prioritized for response and remediation. Incidents
are evaluated to determine materiality, as well as operational, business and privacy impact.
Recognizing that our employees are a crucial line of defense against cybersecurity threats, RB Global conducts mandatory onboarding and annual security
awareness training. We also designate October as Cybersecurity Awareness Month and emphasize through various information campaigns the importance of
data and systems security and privacy. Additionally, we deploy phishing simulations to provide “experiential learning” on how to recognize phishing attempts
and we measure the effectiveness of our training.
We are not aware of having experienced, directly or through our third-party providers, any risks from cybersecurity threats or incidents through the date of this
Report that have materially affected the Company, its business strategy, results of operations or financial condition, or are reasonably likely to have such an
effect. This does not guarantee that future incidents or threats will not have a material impact, or that we or our third-party providers are not currently the
subject of an undetected incident or threat that may have such an impact. For more information on our cybersecurity related risks, see Item 1A Risk Factors of
this Annual Report on Form 10-K.
Governance
The Board of Directors and management are actively involved and play an important part in the oversight of cybersecurity threats and incidents. Our Audit
Committee reviews the Company’s cybersecurity strategy and readiness at least annually and receives a quarterly, or more often as needed, briefing from our
Chief Technology Officer ("CTO") and CISO on cybersecurity matters and key performance indicators relating to the security program. The Audit Committee
briefs the full Board of Directors on cybersecurity, and where necessary, management is available to provide further insight into such matters or other related
cybersecurity matters. The Global Internal Audit department, which reports to the Audit Committee, annually tests the design and operating effectiveness of
certain cybersecurity-related processes. Our Board members also engage in ad hoc conversations with management on cybersecurity-related news events and
discuss any updates to our cybersecurity risk management and strategy processes as needed. Visibility and transparency regarding our cybersecurity program
and cybersecurity threats and incidents provides the Board with the foundation for oversight over the Company's security operations, program status and
cybersecurity risk management.
At the management level, our cybersecurity risk management and strategy processes are overseen by the Company's CTO, CISO and VP, Global Internal Audit
and Enterprise Risk Management with ongoing feedback and risk reduction initiative support from the SSC. The committee generally meets quarterly to
discuss operational cybersecurity risks and associated remediation efforts. The Company's CTO and CISO each have substantial work experience in roles
involving IT, including security, network management, application and systems engineering and architecture. Our CTO has served in various roles in IT for
more than 20 years, including most recently serving as the Sr. Vice President of Product Engineering from 2021 to 2023, and VP, Digital from 2020 to 2021 at
a large public retail company where she played a leading role in the retailer's technology transformation. She holds an undergraduate degree in industrial
engineering. The Company's CISO has served in various roles in IT and information security for more than 20 years across a number of industries, including
financial and investment management, human resources consulting, and consumer data intelligence. Most recently, in addition to his role as the Company's
CISO, he served as our VP, Information Technology since 2017. Over the past 5 years, he has sat on various industry CISO advisory boards and currently sits
on two advisory boards for companies transforming security operations through artificial intelligence and enriched security data management solutions. He also
holds an undergraduate diploma in computer systems networking and telecommunications and several certifications, including a certification in computer
hacking forensic investigation. Our VP, Global Internal Audit and Enterprise Risk Management has 25 years of experience in auditing internal controls and risk
management. Most recently, he served as IAA's VP, Internal Audit since 2022 up until the Company's acquisition of IAA and as Global Director, Finance &
Internal Controls from 2020 to 2022 of a large medical waste disposal and
RB Global, Inc.
29
Table of Contents
secure information destruction business. He holds an undergraduate degree in accounting and information systems and several designations, including a
certification in risk management assurance. These individuals remain informed about, and monitor the prevention, mitigation, detection and remediation of
cybersecurity threats and incidents through their leadership of the cybersecurity risk management and strategy processes and management committees
described above.
ITEM 2: PROPERTIES
We own and lease various properties globally, primarily in the United States, Canada, Australia, and Europe, including in the United Kingdom. We use the
properties for our operations, primarily as auction sites, branches and for storage, as well as for administrative offices, which support our various businesses
and brands.
We are headquartered in Westchester, Illinois, United States, which is held through a lease until 2027. We also lease other administrative offices primarily in the
United States, Canada, and the Netherlands. In total, we lease over 1 million square feet of administrative office space around the world.
We have operating locations in 50 large metropolitan areas in the United States and Canada, in all 50 states in the United States and in 9 out of the 13 Canadian
provinces and territories. The close proximity of our locations to large metropolitan areas benefits our sellers who prefer to drop off their assets at our auction
sites, where we offer care, custody and control, as well as our buyers who prefer to physically inspect an asset prior to bidding. Our wide network of auction
sites and their proximity to major cities further allows us to respond quickly during catastrophic events, and deliver on our commitments to insurance
companies, while reducing our incremental costs. To support our partners, customers and operations during catastrophic events, we also hold agreements that
give us the option to lease and use certain properties totaling approximately 2,000 acres within certain timeframes, as necessary.
The table below sets forth a summary of our owned and leased properties for operations, by region and acreage, at December 31, 2024:
Location
Number of
Locations
Owned Acreage
Leased Acreage
United States
246
3,704
7,377
Canada
30
884
539
International
35
788
248
Total
311
5,376
8,164
During 2024, primarily in our automotive sector, we opened 5 new operating locations in the United States and Canada and expanded some of our existing
locations to support additional operating activities. Additionally, we converted 13 previously leased properties to owned properties, primarily through lease
buyouts.
To support our GovPlanet operations, we also lease two warehouses in addition to the above.
We regularly evaluate our capacity in all markets to ensure our administrative offices and operating facilities continue to meet our varied and extensive needs
and allow us to conduct our operations to the best of our abilities. Where appropriate, we will increase our capacity through the acquisition of additional land
and facilities, either through purchase or lease.
ITEM 3: LEGAL PROCEEDINGS
We have no material legal proceedings pending, other than ordinary routine litigation incidental to the business, and we do not know of any material
proceedings contemplated by governmental authorities.
ITEM 4: MINE SAFETY DISCLOSURES
Not applicable.
RB Global, Inc.
30
Table of Contents
PART II
ITEM 5: MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF
EQUITY SECURITIES
Outstanding Share Data
We are a public company and our common shares are listed under the symbol “RBA” on the New York Stock Exchange (“NYSE”) and the Toronto Stock
Exchange (“TSX”). The Series A Senior Preferred Shares of the Company are not listed on any exchange and there is no established public trading market for
the Series A Senior Preferred Shares. Holders of the Series A Senior Preferred Shares are entitled to vote together with the common shares on an as-converted
basis on all matters permitted by applicable law, subject to certain exceptions to enable compliance with applicable antitrust law. As of February 26, 2025, each
holder of Series A Senior Preferred Shares would be entitled to 0.0139696 vote per Series A Senior Preferred Share held. Series A Senior Preferred Shares
represent, as of February 26, 2025, 6,775,252 votes, which is the number of common shares into which the Series A Senior Preferred Shares could be converted
as of February 26, 2025. Such number of votes represents approximately 3.5% of the voting rights attached to the Company’s securities as of February 26,
2025.
In the event of a take-over bid for the common shares, a holder of Series A Senior Preferred Shares may participate in such take-over bid by exercising the
conversion rights attached to such Series A Senior Preferred Shares. Each outstanding Series A Senior Preferred Share shall be convertible into common shares
at the option of the holder, subject to the terms and conditions contained in the articles of the Company. Under certain circumstances prescribed under the
articles of the Company, a holder of Series A Senior Preferred Shares may also have the right to require the Company to redeem all or any portion of such
holder’s Series A Senior Preferred Shares for cash in the event of a take-over bid.
Financial information about our equity and share-based payments is set forth in our consolidated financial statements in "Part II, Item 8: Financial Statements
and Supplementary Data - Note 23 Temporary Equity, Stockholders' Equity and Dividends and Item 8: Financial Statements and Supplementary Data - Note 24
Share-based Payments" of this Annual Report on Form 10-K.
Market Information
Our common shares, without par value, are issued in registered form. The transfer agent for the shares is Computershare Trust Company of Canada, 100
University Avenue, 9 Floor, Toronto, Ontario M5J 2Y1. Our common shares trade on the NYSE and on the TSX under the symbol “RBA.” On February 25,
2025, there were 1,130 holders of record of our common shares that do not include the shareholders for whom shares are held in a nominee or street name.
Dividend Policy
We currently pay a regular quarterly cash dividend of $0.29 per common share. We intend to continue to declare and pay a regular quarterly cash dividend on
our common shares; however, any decision to declare and pay dividends in the future will be made at the discretion of our Board of Directors, after considering
our operating results, financial condition, cash requirements, financing agreement restrictions and any other factors our Board of Directors may deem relevant.
Because RB Global Inc. is a holding company with no material assets other than the shares of its subsidiaries, our ability to pay dividends on our common
shares depends on the income and cash flow of our subsidiaries. No financing agreements to which our subsidiaries are party currently restrict those
subsidiaries from paying dividends.
Pursuant to income tax legislation, Canadian resident individuals who receive “eligible dividends” in 2006 and subsequent years will be entitled to an enhanced
gross-up and dividend tax credit on such dividends. All dividends that we pay are “eligible dividends” unless indicated otherwise.
th
RB Global, Inc.
31
Table of Contents
Comparison of Cumulative Return
The following graph compares the cumulative return on a $100 investment in our common shares over the last five fiscal years beginning December 31, 2019
through December 31, 2024, to that of the cumulative return on a $100 investment in the Russell Global Index (“Russell 2000”), the S&P / TSX Composite
Index (“S&P/TSX”) and the Dow Jones Industrial Average Index (“DJIA”) for the same period. In calculating the cumulative return, reinvestment of dividends,
if any, is assumed. The indices are included for comparative purpose only. This graph is not “soliciting material,” is not deemed filed with the SEC and is not to
be incorporated by reference in any of our filings under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of
any general incorporation language in any such filing.
Company / index
2019
2020
2021
2022
2023
2024
RBA (NYSE)
$
100.0
$
164.6
$
147.1
$
141.4
$
169.9
$
232.3
Russell 2000
$
100.0
$
119.9
$
137.7
$
109.5
$
128.0
$
142.7
S&P/TSX
$
100.0
$
105.6
$
132.2
$
124.6
$
139.3
$
169.5
DJIA
$
100.0
$
109.7
$
132.7
$
123.6
$
143.6
$
165.1
RB Global, Inc.
32
Table of Contents
Securities Authorized for Issuance under Equity Compensation Plans
The following table sets forth information about the Company’s equity compensation plans at December 31, 2024.
Plan Category
Number of securities to be
issued
upon exercise of options,
warrants and rights
(a)
Weighted average exercise
price of outstanding options,
warrants and rights
(b)
Number of securities remaining
available for future issuance
under
equity compensation plans
(excluding
securities reflected in column
(a))
(c)
Equity compensation plans approved by security holders
3,370,692
$
64.49
10,265,156
Equity compensation plans not approved by security holders
—
—
—
Total
3,370,692
$
64.49
10,265,156
_____________________________________________________
(1) Reflects our 2023 Share Incentive Plan, which was approved by the Company's shareholders on May 8, 2023, as well as equity awards granted under our
previous plans until expiration or settlement. This amount reflects 100% of target numbers of PSUs granted and includes dividend equivalent rights
credited in connection with such PSUs. Under the Plan, the number of PSUs that vest is conditional upon specified market, service, and/or performance
vesting conditions being met. For the August 2023 and March 2024 PSUs with market conditions, the market vesting condition is based on the total
stockholder return performance of the Company relative to the performance of the Russell 3000 index members at the date of grant. The August 2023 and
March 2024 PSUs with market conditions can result in participants earning between 0% and 200% of the target number granted. Share units granted under
our Plan with no market vesting conditions are based on the achievement of specific performance measures and can result in participants earning between
0% and 200% of the target number of PSUs granted. Further, we have the option to choose whether to settle these PSUs without market vesting conditions
in cash or in shares. For further discussion on the PSUs granted under our Plans, refer to "Part II, Item 8: Financial Statements and Supplementary Data -
Note 24 Share-based Payments."
(2) Weighted average exercise price does not include the effect of our outstanding share units.
(3) Consists of 7,958,801 common shares available for issuance under the 2023 Share Incentive Plan and 2,306,355 common shares available for issuance
under the 2023 ESPP.
Exchange Controls
Canada has no system of exchange controls. There are no Canadian restrictions on the repatriation of capital or earnings of a Canadian public company to non-
resident investors. There are no laws in Canada or exchange restrictions affecting the remittance of dividends and other payments to U.S. Resident Holders (as
defined below) of our common shares, other than withholding tax.
There are no limitations under the laws of Canada or in our organizational documents on the right of foreigners to hold or vote our common shares, except that
the Investment Canada Act may require review and approval by the Minister of Industry (Canada) of certain acquisitions of control of RB Global by a “non-
Canadian”. “Non-Canadian” generally means an individual who is not a Canadian citizen, or a corporation, partnership, trust or joint venture that is ultimately
controlled by non-Canadians.
Certain Canadian Federal Income Tax Considerations for U.S. Residents
The following summarizes certain Canadian federal income tax consequences generally applicable under the Income Tax Act (Canada) and the regulations
promulgated thereunder (collectively, the “Canadian Tax Act”) and the Canada-U.S. Income Tax Convention (1980) (the “Convention”) to the holding and
disposition of common shares by a U.S. Resident Holder (as defined below).
This summary is restricted to beneficial owners of common shares each of whom, at all relevant times for the purposes of the Canadian Tax Act and the
Convention, (i) is resident solely in the U.S., (ii) is entitled to the full benefits of the Convention, (iii) holds all common shares as capital property, (iv) deals at
arm’s length with and is not affiliated with RB Global, (v) does not and is not deemed to use or hold any common shares in a business carried on in Canada,
and (vi) is not an "authorized foreign bank" (as defined in the Canadian Tax Act) or an insurer that carries on business in Canada and elsewhere (each such
holder, a “U.S. Resident Holder”).
Certain U.S.-resident entities that are fiscally transparent for U.S. federal income tax purposes (including limited liability companies) may not be regarded by
the CRA as entitled to the benefits of the Convention. Members of or holders of an interest in such an entity that holds common shares should consult their own
tax advisers regarding the extent, if any, to which the CRA will extend the benefits of the Convention in respect of common shares held by such entity.
(1)
(2)
(3)
RB Global, Inc.
33
Table of Contents
Generally, a U.S. Resident Holder’s common shares will be considered to be capital property of a U.S. Resident Holder provided that the U.S. Resident Holder
does not acquire, hold or dispose of the common shares in one or more transactions considered to be an adventure or concern in the nature of trade and does not
hold the common shares in the course of carrying on a business.
This summary is based on the provisions of the Canadian Tax Act and the Convention in effect on the date hereof, all specific proposals to amend the Canadian
Tax Act and Convention publicly announced by or on behalf of the Minister of Finance (Canada) on or before the date hereof (the “Tax Proposals”), and the
current published administrative policies of the CRA. It is assumed that the Tax Proposals will be enacted as currently proposed, and that there will be no other
change to any applicable law or the CRA's administrative policies, whether by judicial, legislative, governmental or administrative decision or action, although
no assurance can be given in these respects. Except as otherwise expressly provided, this summary does not take into account any provincial, territorial or
foreign tax considerations, which may differ materially from those set out herein.
This summary is of a general nature only and it is not intended to be, nor should it be construed to be, legal or tax advice to any holder of common shares, and
no representation with respect to Canadian federal income tax consequences to any holder of common shares is made herein. Accordingly, holders of common
shares should consult their own tax advisers with respect to their individual circumstances.
Disposition of Common Shares
A U.S. Resident Holder will not be subject to tax under the Canadian Tax Act in respect of any capital gain realized by such U.S. Resident Holder on a
disposition of common shares unless the common shares constitute “taxable Canadian property” (within the meaning of the Canadian Tax Act) of the U.S.
Resident Holder at the time of disposition and the U.S. Resident Holder is not entitled under the Convention to an exemption from Canadian tax on the gain.
Generally, a U.S. Resident Holder’s common share will not constitute “taxable Canadian property” of the U.S. Resident Holder at the time of disposition
provided that such share is listed on a “designated stock exchange” for purposes of the Canadian Tax Act (which currently includes the TSX and NYSE) unless
at any time during the 60-month period immediately preceding the disposition both of the following conditions are true:
(i)
the U.S. Resident Holder, any one or more persons with whom the U.S. Resident Holder does not deal at arm’s length, or any partnership in which the U.S.
Resident Holder or persons with whom the U.S. Resident Holder did not deal at arm’s length holds a membership interest directly or indirectly through one
or more partnerships, alone or in any combination, owned 25% or more of the issued shares of any class or series of our share capital; and
(ii) more than 50% of the fair market value of such common share was derived directly or indirectly from, or from any combination of, real or immovable
property situated in Canada, “Canadian resource properties” (as defined in the Canadian Tax Act), “timber resource properties” (as defined in the Canadian
Tax Act), or options in respect of, interests in or civil law rights in, such properties, whether or not such properties exist.
In certain circumstances set out in the Canadian Tax Act, a common share may be deemed to be “taxable Canadian property” for purposes of the Canadian Tax
Act.
Even if the common shares constitute “taxable Canadian property” to a U.S. Resident Holder, under the Convention, such a U.S. Resident Holder will not be
subject to tax under the Canadian Tax Act on any capital gain realized by such holder on a disposition of such common shares, provided the value of such
common shares is not derived principally from real property situated in Canada (within the meaning of the Convention).
U.S. Resident Holders whose common shares may be taxable Canadian property should consult their own tax advisers
Dividends on Common Shares
Dividends paid or credited, or deemed to be paid or credited, on common shares to a U.S. Resident Holder will generally be subject to Canadian withholding
tax. Under the Canadian Tax Act, the rate of withholding tax is 25% of the gross amount of such dividends, which rate may be subject to reduction under the
provisions of an applicable income tax treaty or convention. Under the Convention, a U.S. Resident Holder who is a beneficial owner of a dividend will
generally be subject to Canadian withholding tax at the rate of 15% of the gross amount of such dividend, unless the beneficial owner is a company which
owns (or is deemed under the Convention to own) at least 10% of the voting shares of RB Global at that time, in which case the rate of Canadian withholding
tax is generally reduced to 5%.
ITEM 6: [RESERVED]
RB Global, Inc.
34
Table of Contents
ITEM 7: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This section of the Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023. Discussions of 2022 items and
year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “Part II, Item 7: Management’s Discussion and
Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. This
discussion and analysis should be read in conjunction with the “Cautionary Note Regarding Forward-Looking Statements” and the consolidated financial
statements and the notes thereto included in “Part II, Item 8. Financial Statements and Supplementary Data” presented in this Annual Report on Form 10-K.
This discussion and analysis contains forward-looking statements that involve risks and uncertainties.
Our actual results could differ materially from those expressed or implied in any forward-looking statements due to various factors, including those set forth
under “Part I, Item 1A: Risk Factors” in this Annual Report on Form 10-K.
We prepare our consolidated financial statements in accordance with U.S. generally accepted accounting principles (“US GAAP”). Except for Gross
Transaction Value ("GTV"), which is a measure of operational performance and not a measure of financial performance, liquidity, or revenue, the amounts
discussed below are based on our consolidated financial statements. Unless indicated otherwise, all tabular dollar amounts, including related footnotes,
presented below are expressed in millions of United States (“U.S.”) dollars.
In the accompanying analysis of financial information, we sometimes use information derived from consolidated financial data but not presented in our
consolidated financial statements prepared in accordance with US GAAP. Certain of these data are considered “non-GAAP financial measures” under the SEC
rules. The definitions and reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable US GAAP financial
measures are included either with the first use thereof or in the “Non-GAAP Measures” section within “Part II, Item 7: Management’s Discussion and Analysis
of Financial Condition and Results of Operations.”
Overview
Established in 1958, RB Global, Inc. (NYSE and TSX: RBA) is a leading global marketplace that connects sellers and buyers of commercial assets and
vehicles. Through our omnichannel platform, we facilitate transactions for customers primarily in our commercial, construction and transportation ("CC&T")
and automotive sectors. We also provide our customers value-added marketplace services, technology solutions for vehicle merchandising, platforms for
lifecycle management of assets, and a market data intelligence platform to help customers make more informed business decisions.
Our marketplace brands include Ritchie Bros., the world's largest auctioneer of commercial assets and vehicles offering online bidding, and IAA, Inc. ("IAA"),
a leading global digital marketplace connecting vehicle buyers and sellers. Our portfolio of brands also includes Rouse Services ("Rouse"), which provides a
complete end-to-end asset management, data-driven intelligence and performance benchmarking system; SmartEquip Inc. ("SmartEquip"), an innovative
technology platform that supports customers' management of the equipment lifecycle and integrates parts procurement with both OEMs and dealers; and
VeriTread LLC ("VeriTread"), an online marketplace for heavy haul transport.
Our CC&T sector includes heavy equipment such as excavators, dozers, lift and material handling, vocational and commercial trucks and trailers. Our
automotive sector includes all consumer automotive vehicles. The other sector primarily includes assets and equipment in the agricultural, forestry and energy
industries, government surplus assets, smaller consumer recreational transportation items and parts sold in our vehicle dismantling business. All sectors include
salvage and non-salvage transactions.
Our customers primarily include automotive insurance companies, as well as end users, dealers, fleet owners, and original equipment manufacturers (“OEMs”)
of commercial assets and vehicles. We also serve customers in the agriculture, energy, and natural resources sectors, as well as government entities.
We have a global presence, primarily with operations in the United States, Canada, Australia and across Europe, and employ more than 7,800 full-time
employees worldwide, of which approximately 67% are located in the United States.
RB Global, Inc.
35
Table of Contents
Key Operating Metrics
We regularly review a number of metrics, including the following key operating metrics, to evaluate our business, measure our performance, identify trends
affecting our business, and make operating decisions. We believe these key operating metrics are useful to investors because management uses these metrics to
assess the growth of our business and the effectiveness of our operational strategies.
We define our key operating metrics as follows:
GTV: Represents total proceeds from all items sold on our auctions and online marketplaces, third-party online marketplaces, private brokerage services and
other disposition channels. GTV is not a measure of financial performance, liquidity, or revenue, and is not presented in the Company’s consolidated financial
statements.
Inventory return: Inventory sales revenue less cost of inventory sold.
Inventory rate: Inventory return divided by inventory sales revenue.
Total lots sold: A single asset to be sold, or a group of assets bundled for sale as one unit. Low value assets are sometimes bundled into a single lot, collectively
referred to as “small value lots.”
Historically, we presented GTV from the sale of parts in our vehicle dismantling business within our automotive sector and excluded the number of parts sold
from our total lots sold metric. Commencing in the second quarter of 2024, management began to review the number of parts sold in our vehicle dismantling
business within our other sector and as part of our total lots sold metric.
Performance Overview and Consolidated Results
For the year ended December 31, 2024, as compared to the year ended December 31, 2023:
•
Total GTV increased 14% to $15.9 billion.
•
Total revenue increased 16% to $4.3 billion.
◦
Service revenue increased 23% to $3.4 billion.
◦
Inventory sales revenue decreased 3% to $920.6 million.
•
Net income increased 100% to $412.8 million.
•
Net income available to common stockholders increased 113% to $372.7 million.
•
Diluted earnings per share (“EPS”) available to stockholders increased 93% to $2.01 per share.
•
Diluted adjusted EPS available to stockholders increased 17% to $3.49 per share.
•
Adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) increased 26% to $1.3 billion.
Operational Highlights
During 2024, we saw several changes in our executive leadership team. Eric J Guerin was appointed Chief Financial Officer, effective January 15, 2024. Eric J.
Guerin brings extensive senior executive financial leadership experience, most recently serving as the Chief Financial Officer at a leading distributor of
packaging, facility solutions and print products. Nancy King was appointed Chief Technology Officer, effective June 3, 2024, and brings extensive hands-on
information technology leadership experience from her roles at multiple Fortune 100 organizations. Steve Lewis was appointed Chief Operating Officer,
effective September 3, 2024, and brings extensive senior leadership experience in operations and supply chain management, as well as a honed approach to
driving business growth through operational excellence.
Below are some other notable operational highlights during 2024:
•
RB Global had strong operating results and growth, resulting in a 14% year-over-year increase in total GTV and 16% year-over year increase in total
revenues.
•
Through our continuous improvement program, we consistently delivered exceptional performance, as measured against our service level agreements, to
our automotive insurance company customers. We also drove industry leading average selling prices for our partners, enabled by investment in technology
and attracting record-high engagement from international buyers. These advancements and ongoing transparency initiatives have reinforced our leadership
in salvage vehicles, resulting in significant partnership wins in the United States and in Australia.
RB Global, Inc.
36
Table of Contents
•
On October 31, 2024, the Company completed the acquisition of Boom & Bucket, Inc ("Boom & Bucket"), a digital fixed price marketplace to add to our
portfolio of selling solutions, serving the construction equipment industry. We believe that Boom & Bucket's technology, talent and market capabilities
offer an exciting complement to our full-service disposition portfolio.
•
In 2024, we continued to invest in the development of our technology, particularly in a new digital payments platform that replaces outdated manual
processes and legacy technology with a modern financial backbone to offer our buyers and partners increased choice in our services, including self-serve
access to critical financial tools, and provide our buyers and sellers the best in-class experience.
•
In January 2024, we enhanced IAA's merchandising services to provide more accurate VIN decoding to our customers and improve the overall customer
experience for all users, buyers and sellers, by providing more comprehensive data. Buyers of vehicles are now able to search for specific makes, models,
and trims of vehicles with more confidence due to more data, configuration rules and industry-leading data-engineering capabilities.
•
During the year, in our automotive sector, we continued to expand our international customer base with new market alliances in Oman in the Middle East
and in Lithuania in Eastern Europe. These market alliances will help us connect with a base of new buyers and broaden our market share.
Results of Operations
Year ended December 31,
% Change
(in U.S. dollars in millions, except percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
Service revenue
$
3,363.6
$
2,732.5
$
1,050.6
23 %
160 %
Inventory sales revenue
920.6
947.1
683.2
(3)%
39 %
Total revenue
4,284.2
3,679.6
1,733.8
16 %
112 %
Costs of services
1,415.7
1,007.6
168.1
41 %
499 %
Cost of inventory sold
863.8
893.6
608.6
(3)%
47 %
Selling, general and administrative
773.9
743.7
539.9
4 %
38 %
Acquisition-related and integration costs
29.0
216.1
37.3
(87)%
479 %
Depreciation and amortization
444.4
352.2
97.2
26 %
262 %
Total operating expenses
3,526.8
3,213.2
1,451.1
10 %
121 %
Gain on disposition of property, plant and equipment
3.8
4.9
170.8
(22)%
(97)%
Operating income
761.2
471.3
453.5
62 %
4 %
Net income
412.8
206.0
319.8
100 %
(36)%
Net income available to common stockholders
372.7
174.9
319.7
113 %
(45)%
Effective tax rate
25.0 %
27.1 %
21.2 %
(210)bps
590bps
Total GTV
$
15,904.8
$
13,930.6
$
6,025.9
14 %
131 %
Service GTV
14,984.2
12,983.5
5,342.7
15 %
143 %
Inventory GTV
920.6
947.1
683.2
(3)%
39 %
Inventory return
$
56.8
$
53.5
$
74.6
6 %
(28)%
Inventory rate
6.2 %
5.6 %
10.9 %
60bps
(530)bps
Foreign exchange gain (loss) for the year ended 2022 has been reclassified from operating income to a separate line below operating income.
1
1
RB Global, Inc.
37
Table of Contents
Total GTV
Total GTV increased 14% to $15.9 billion in 2024 as compared to $13.9 billion in 2023.
The following summarizes our total GTV by geography and by sector for the periods indicated:
Year ended December 31,
% Change
(in U.S. dollars in millions, except percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
United States
$
11,966.4
$
10,266.1
$
3,432.4
17 %
199 %
Canada
2,688.1
2,460.8
1,707.1
9 %
44 %
International
1,250.3
1,203.7
886.4
4 %
36 %
Total GTV
$
15,904.8
$
13,930.6
$
6,025.9
14 %
131 %
Year ended December 31,
% Change
(in U.S. dollars in millions, except percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
Automotive
$
8,277.6
$
6,531.2
$
186.0
27 %
3,411 %
CC&T
5,805.8
5,446.5
4,252.9
7 %
28 %
Other
1,821.4
1,952.9
1,587.0
(7)%
23 %
Total GTV
$
15,904.8
$
13,930.6
$
6,025.9
14 %
131 %
The following table illustrates the breakdown of total lots sold by sector for the periods indicated:
Year ended December 31,
% Change
(in '000's of lots sold, except percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
Automotive
2,297.2
1,788.4
21.0
28 %
8,416 %
CC&T
432.3
314.5
181.5
37 %
73 %
Other
617.3
591.1
415.3
4 %
42 %
Total Lots Sold
3,346.8
2,694.0
617.8
24 %
336 %
In 2024, total GTV and lots sold increased primarily due to the full quarter inclusion of IAA in the first quarter of 2024, compared to the 11-day stub period in
the first quarter of 2023. Excluding this impact, GTV remained primarily flat year over year. We saw higher GTV volumes from catastrophic events in our
automotive sector, and higher GTV in our CC&T sector driven by higher lot volumes from our strategic accounts, primarily from a large consignor contract in
transportation. These increases were primarily offset by unfavorable asset mix as well as price declines, predominantly observed within our CC&T and other
sectors, and lower volumes from a shift in assignment volumes from a customer in our automotive sector.
RB Global, Inc.
38
Table of Contents
Total Revenue
Total revenue increased 16% to $4.3 billion in 2024 as compared to 2023, with total service revenue increasing by 23% and partially offset by a 3% decrease in
inventory sales revenue.
Service Revenue
The following table summarizes key components of total service revenue for the periods indicated:
Year ended December 31,
% Change
(in U.S. dollars in millions, except percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
Transactional seller revenue
$
939.4
$
851.7
$
514.6
10 %
66 %
Transactional buyer revenue
2,067.1
1,593.2
330.6
30 %
382 %
Marketplace services revenue
357.1
287.6
205.4
24 %
40 %
Total service revenue
$
3,363.6
$
2,732.5
$
1,050.6
23 %
160 %
In the third quarter of 2024, we updated our presentation of disaggregated revenue to align to how management evaluates its financial and business
performance. As a result, transactional seller revenue now includes commissions, pre-negotiated or fixed, as well as certain auction-related fees earned from
sellers to complete the sale of an asset, such as towing to our yards, liens search, title processing and online listing and inspection fees. Transactional buyer
revenue now includes buyer transaction fees based on a tiered structure earned from purchasers upon purchase of an asset, as well as other auction-related fees
earned from buyers to complete the purchase of an asset, such as title processing, late-pick up, salvage buyer platform registration and other administrative
processing charges. Accordingly, certain auction-related fees were reclassified from marketplace services revenue to transactional seller or transactional buyer
revenue, and prior period disaggregation of revenue amounts have been recast to conform with current period presentation.
In 2024, total service revenue increased 23%, with transactional buyer revenue increasing 30%, marketplace services revenue increasing 24% and transactional
seller revenue increasing 10%.
Transactional buyer revenue increased 30%, primarily driven by the inclusion of IAA in the first quarter of 2024 for the full quarter compared to the 11-day
stub period in the first quarter of 2023. Excluding the impact of the IAA acquisition in the first quarter, transactional buyer revenue growth exceeded the 14%
increase in total GTV mainly from higher buyer fee rate structures implemented throughout 2024 across all sectors, but primarily within our automotive sector.
Marketplace services revenue increased 24%, driven primarily from higher fees earned from transportation services provided to a large consignor contract in
the United States in our CC&T sector, as well as due to the increase in fees from the inclusion of IAA in the first quarter of 2024 for the full quarter compared
to the 11-day stub period in the first quarter of 2023.
Transactional seller revenue increased 10%, primarily due to the inclusion of IAA in the first quarter of 2024 for the full quarter compared to the 11-day stub
period in the first quarter of 2023. Excluding the impact of the IAA acquisition in the first quarter, transactional seller revenue growth was less than the 15%
increase in service GTV due to softer performances primarily in our guarantee contracts in Canada within our CC&T sector.
Inventory Sales Revenue
Inventory sales revenue decreased 3% in 2024, primarily driven by lower volumes in our CC&T sector in the United States from softer year-over-year
performance due to lower price realization and an unfavorable contract mix, as well as due to the non-repeat of a large inventory package in the utilities sector.
We also saw softer performances in our GovPlanet business driven primarily from a higher volume of low value assets and pricing pressure. These decreases
were partially offset by the inclusion of inventory sales revenue from IAA in the first quarter of 2024 for the full quarter compared to the 11-day stub period in
the first quarter of 2023 and favorable performances in Canada in our CC&T sector driven by a few significant inventory contracts.
Costs of Services
Costs of services increased 41% to $1.4 billion, primarily due to the full quarter inclusion of IAA in the first quarter of 2024 compared to the 11-day stub
period in the the first quarter of 2023, which contributed 85% of the increase, and primarily relates to costs to provide towing services to buyers, building and
facility costs including operating lease costs for auction sites, as well as employee compensation expenses. We also incurred higher costs of services in
connection with a large consignor contract in transportation in the United States, which included higher costs to provide transportation services and higher
payments to a third party as part of a profit-
RB Global, Inc.
39
Table of Contents
sharing arrangement. Further, we saw higher costs of services in our automotive sector as prior year included a benefit related to a fair value adjustment made
to prepaid consigned vehicle charges on the opening balance sheet of IAA at acquisition. In addition, we saw higher employee compensation expenses as a
result of changes made to our employee benefit plans and higher employee labor costs to support increased activity. In our automotive sector, in line with
higher volumes, we also saw higher cost of services due to increases in yard lease expense, title search costs, new digital services tax and operating branch
costs.
Cost of Inventory Sold
Cost of inventory sold decreased 3% to $863.8 million, primarily in line with the decrease in inventory sales revenue of 3%.
Selling, General and Administrative
Selling, general and administrative expenses increased 4% to $773.9 million, mainly due to the full quarter inclusion of IAA in the first quarter of 2024
compared to the 11-day stub period in the first quarter of 2023. We also saw higher share-based payments expense due to an increase in the size and fair value
of share units granted. In addition, our costs increased due to a new digital services tax enacted in Canada on certain in-scope revenues which was retroactively
applied to the period from January 1, 2022 to June 30, 2024. These increases were partially offset by lower short-term incentive-based compensation expense,
lower travel, advertising and promotional expenses, lower employee compensation expenses as a result of a reduced headcount from our integration activities
and lower costs due to strategic cost reduction initiatives.
Acquisition-related and Integration Costs
Acquisition-related and integration costs decreased 87% to $29.0 million, primarily given the significant investment banking, consulting, financing, legal and
other acquisition-related costs incurred in the prior year to complete the acquisition of IAA on March 20, 2023. We have also incurred lower severance and
integration costs as integration activities and restructuring is being completed. In addition, we recognized a net $16.3 million expense as settlement for the
termination of a non-compete agreement bound by IAA prior to the acquisition in the prior year.
Operating Income
Operating income increased 62% to $761.2 million, primarily driven by the significant decrease in acquisition-related and integration costs and the inclusion of
IAA operating income in the first quarter of 2024 for a full quarter compared to the 11-day stub period in the first quarter of 2023. In addition, we saw a higher
flow-through of service revenue driven by the CC&T sector. These increases are partially offset by higher depreciation and amortization driven by the
acquisition of IAA.
Income Tax Expense and Effective Tax Rate
Income tax expense increased 80% to $137.3 million in 2024, compared to $76.4 million in 2023. Our effective tax rate was 25.0%, compared to 27.1% in
2023. The decrease in the effective tax rate over the prior year was primarily due to a decrease in non-deductible expenses. Partially offsetting this decrease
was a lower proportionate benefit related to Foreign-Derived Intangible Income (“FDII”).
Net Income
Net income attributable to controlling interests increased 100% to $413.1 million, compared to $206.5 million in 2023. The increase was primarily driven by
higher operating income, partially offset by higher income tax expense and higher interest expense due to an increase in long-term debt from funding the IAA
acquisition on March 20, 2023.
Diluted EPS
Diluted EPS available to stockholders increased 93% to $2.01 per share compared to $1.04 in 2023. The increase is primarily due to an increase in net income
attributable to controlling interests, as described above, partially offset by an increase in the weighted average number of dilutive shares outstanding primarily
driven by the shares issued for the acquisition of IAA on March 20, 2023.
RB Global, Inc.
40
Table of Contents
U.S. Dollar Exchange Rate Comparison
We conduct global operations in many different currencies, with our presentation currency being the U.S dollar. The following table presents the variance in
select foreign exchange rates over the comparative reporting periods:
% Change
Value of one local currency to U.S. dollar
2024
2023
2022
2024 over 2023
2023 over 2022
Period-end exchange rate - December 31,
Canadian dollar
0.6969
0.7558
0.7378
(8)%
2 %
Euro
1.0406
1.1067
1.0661
(6)%
4 %
British pound sterling
1.2548
1.2734
1.2054
(1)%
6 %
Australian dollar
0.6219
0.6826
0.6765
(9)%
1 %
Average exchange rate - Year ended December 31,
Canadian dollar
0.7302
0.7411
0.7690
(1)%
(4)%
Euro
1.0823
1.0820
1.0543
— %
3 %
British pound sterling
1.2780
1.2434
1.2376
3 %
— %
Australian dollar
0.6598
0.6645
0.6949
(1)%
(4)%
In 2024, approximately 27% of our revenues and 29% of our operating expenses were denominated in currencies other than the U.S. dollar, compared to 29%
and 30%, respectively, in 2023.
We recognized $1.9 million in foreign exchange losses in 2024 and $1.8 million of losses in 2023. Foreign exchange had an unfavorable impact on total
revenue and a favorable impact on expenses. These impacts were mainly due to the fluctuations in the Canadian dollar, British pound sterling, and Australian
dollar exchanges rates relative to the U.S. dollar during the year.
Non-GAAP Measures
As part of management’s non-GAAP measures, we may eliminate the financial impact of certain items that we do not consider to be part of our normal
operating results.
Adjusted net income available to common stockholders increased 29% to $646.8 million, compared to $502.2 million in 2023.
Diluted adjusted EPS available to common stockholders increased 17% to $3.49 per share, compared to $2.99 per share in 2023.
Adjusted EBITDA increased 26% to $1.3 billion, compared to $1.0 billion in 2023.
Refer to the non-GAAP measures section below on pages 45-51 for further information.
Debt
We have a credit agreement (the "Credit Agreement"), which is comprised of multicurrency revolving facilities and the Term Loan A facility (the “TLA
Facility”). The TLA Facility is comprised of a facility denominated in US dollars (the "USD TLA Facility"), and a facility denominated in Canadian dollars
(the "CAD TLA Facility"). TLA Facility borrowings bear interest at a benchmark rate plus an applicable margin. The Credit Agreement matures on September
21, 2026.
The TLA Facility loans are subject to quarterly installments of 1.25% of principal, with the balance payable at maturity. During 2024, the Company repaid
$450.0 million (2023: $150.0 million) of principal on the USD TLA Facility. At December 31, 2024, there are no mandatory principal repayments remaining on
the USD TLA Facility until maturity of the debt. We continue to seek opportunities to prepay our debt.
At December 31, 2024, the Company also had $550.0 million aggregate principal amount of 6.750% senior secured notes due March 15, 2028 (the "Secured
Notes"), and (ii) $800.0 million aggregate principal amount of 7.750% senior unsecured notes due March 15, 2031 (the "Unsecured Notes") (collectively, the
"Notes"). These Notes were used, along with the USD TLA Facility, to fund the acquisition of IAA, and accrue interest to be paid in cash semi-annually in
arrears. The Secured Notes are jointly and severally guaranteed on a senior secured basis and the Unsecured Notes are jointly and severally guaranteed on a
senior unsecured basis by
RB Global, Inc.
41
Table of Contents
certain of the Company’s subsidiaries.
The below were our committed and uncommitted revolving credit facilities at December 31, 2024 and 2023:
(in U.S. dollars in millions)
December 31, 2024
December 31, 2023
Committed
Multicurrency revolving credit facilities
$
750.0 $
750.0
Uncommitted
Foreign demand revolving credit facilities
15.0
5.0
Total revolving credit facilities
$
765.0 $
755.0
Unused
Multicurrency revolving credit facilities
$
705.9 $
724.7
Foreign demand revolving credit facilities
15.0 $
5.0
Total credit facilities unused
$
720.9 $
729.7
Debt Covenants
We were in compliance with all financial and other covenants applicable to our credit facilities at December 31, 2024.
Our ability to borrow under the Credit Agreement is subject to compliance with financial covenants of a consolidated leverage ratio and a consolidated interest
coverage ratio. In the event of sustained deterioration of global markets and economies, we expect the covenants pertaining to our leverage ratio would be the
most restrictive to our ability to access funding under our Credit Agreement. We continue to evaluate courses of action to maintain current levels of liquidity
and compliance with our debt covenants.
For more information on our debt, see "Item 8: Financial Statements and Supplementary Data - Note 21 Debt" in our consolidated financial statements.
Liquidity and Capital Resources
Our short-term cash requirements include (i) payment of quarterly dividends to common shareholders on an as-declared basis, and payment of participating
dividends and preferential dividends to preferred equity holders, (ii) settlement of contracts with consignors, partners and other suppliers, (iii) personnel
expenditures, with a majority of short-term incentive compensation paid annually in the first quarter following each fiscal year, (iv) income tax payments,
primarily paid in quarterly installments, (v) payments on our short-term debt, as well as interest payments on both our short-term and long-term debt, (vi)
payment of amounts committed under certain service agreements to build our modern IT architecture, (vii) payments on our operating and finance lease
obligations, (viii) other capital expenditures and working capital needs, and (ix) advances.
On December 3, 2024, the Canadian Revenue Agency ("CRA") issued the Company a Notice of Assessment and Statement of Interest (“NOA”) for CA$79.1
million (Canadian dollars) (approximately $55.1 million) for additional taxes, interest and penalties with respect to the Company's Luxembourg subsidiary
relating to taxation years 2010 through 2015. In early February 2025, to begin the appeal process, the Company paid a required deposit of CA$39.5 million
(approximately $27.6 million) to the CRA, 50% of the assessed amount. In the event the Company's tax filing position is not upheld, the Company would be
required to pay the remaining 50% of the assessed amount, plus interest. However, in the event that the Company prevails in its objection or subsequent legal
proceedings, the deposit would be refunded with interest to the Company. The matter is expected to take years to resolve. The CRA has also requested
information regarding the 2016 to 2020 taxation years for the same matter. For more information on the matter, see "Part II, Item 8: Financial Statements and
Supplementary Data - Note 8 Income Taxes" in our consolidated financial statements.
We believe that our existing working capital and availability under our credit facilities are sufficient to satisfy our present operating requirements and
contractual obligations, including the CRA matter noted above. In the current interest rate environment, the Company intends to continue to evaluate and
pursue the most financially beneficial arrangements to fund future capital expenditures, which may include lease agreements or cash purchases.
Our long-term cash requirements include scheduled principal repayments of long-term debt upon maturity relating to the TLA Facility and the Notes,
repayment of any drawn funds under our revolving credit facilities, as well as scheduled repayments of operating and finance lease obligations relating to the
Company’s commercial leases for various auctions sites, branches and offices, operating leases for computer equipment, software, motor vehicles and small
office equipment, and finance lease arrangements for certain vehicles, computers, yard equipment, fixtures, and office furniture. In addition, we also have
scheduled repayments due on our equipment
RB Global, Inc.
42
Table of Contents
financing obligations. For more information on our debt and leases, see "Part II, "Item 8: Financial Statements and Supplementary Data - Note 21 Debt" and
"Item 8: Financial Statements and Supplementary Data - Note 25 Leases" respectively, in our consolidated financial statements.
Cash provided by operating activities can fluctuate significantly from period to period. We assess our liquidity based on our ability to generate cash and secure
credit to fund operating, investing, and financing activities. Our liquidity is primarily affected by fluctuations in cash provided by operating activities,
significant acquisitions of businesses, payment of dividends, our net capital spending , and repayments of debt. We are also committed under various letters of
credit and provide certain guarantees in the normal course of business. We believe our principal sources of liquidity, which include cash flow from operations
and our unused capacity under our revolving credit facilities of $720.9 million, is sufficient to fund our current and planned operating activities.
Book overdrafts represent outstanding checks and other pending disbursements, which are in excess of cash account balances with a right of offset. The excess
of such amounts is included within trade and other liabilities in our consolidated balance sheets.
If we were to consider further acquisitions to deliver on our strategic growth drivers, we may seek financing through equity markets or additional debt markets.
The issuance of additional equity securities may result in dilution to our shareholders. Issuance of preferred equity securities could provide for rights,
preferences or privileges senior to those of our common stock. Further, this additional capital may not be available on reasonable terms, or at all.
Cash Flows
Year ended December 31,
Change
(in U.S. dollars in millions)
2024
2023
2022
2024 over 2023
2023 over 2022
Cash provided by (used in):
Operating activities
$
932.0
$
544.0
$
463.1
$
388.0
$
80.9
Investing activities
(301.6)
(3,108.3)
77.2
2,806.7
(3,185.5)
Financing activities
(645.5)
2,676.2
(1,258.1)
(3,321.7)
3,934.3
Effect of changes in foreign currency rates
(24.0)
10.1
(18.8)
(34.1)
28.9
Net increase (decrease) in cash, cash equivalents, and restricted cash
$
(39.1)
$
122.0
$
(736.6)
$
(161.1)
$
858.6
Net cash provided by operating activities was $932.0 million in 2024, as compared to net cash provided by operating activities of $544.0 million in 2023. The
increase of $388.0 million is mainly due to an increase in net income, as discussed above, and a lower cash outflow from the net change in operating assets and
liabilities of $43.9 million. The decrease in cash outflow from the net change in operating assets and liabilities was primarily driven by an increase in book
overdrafts, due to timing, prepaid consigned vehicle charges due to the inclusion of IAA, and lower tax payments due to the non-repeat of taxes paid in 2023
for the taxable gain portion on the sale of the Bolton property. In addition, we also saw lower cash outflows relating to timing of payments for inventory
purchases and timing of recovery of advances from customers. These decreases in cash outflows were partially offset by timing and settlement of higher
interest payments on our debt, as well as the size and timing of our auctions. In addition, as a result of the inclusion of IAA from its acquisition on March 20,
2023, in the current year, we saw higher cash outflows in incentive-based employee compensation, higher payments for indirect taxes, lower reimbursement of
leasehold improvements from lessors, as well as higher operating lease payments.
Net cash used in investing activities was $301.6 million in 2024, as compared to net cash used in investing activities of $3.1 billion in 2023. Net cash used in
investing activities decreased by $2.8 billion primarily due to cash used in the prior year to fund the acquisitions of IAA and VeriTread, as well as lower net
capital expenditures on property, plant and equipment and investments in intangible assets as we shift to more cloud computing arrangements. These decreases
were offset by an increase in cash outflow of approximately $8.6 million for the acquisition of Boom & Bucket.
Net cash used in financing activities was $645.5 million in 2024, as compared to net cash provided by financing activities of $2.7 billion in 2023. The change is
primarily driven by higher cash inflows in the prior period, as we raised $3.1 billion in debt to fund the acquisition of IAA through the TLA Facility and the
Notes, net of debt issuance costs, and received $496.9 million in net proceeds from the issuance of the Series A Senior Preferred Shares and common stock. In
addition, we repaid $600.0 million of long-term debt in the first half of 2023 for the redemption of our 2016 Notes and $100.0 million repayment of debt on our
USD TLA Facility, as
We calculate net capital spending as property, plant and equipment additions plus intangible asset additions less proceeds on disposition of property, plant and
equipment.
1
1
RB Global, Inc.
43
Table of Contents
compared to $450.0 million repayment on our USD TLA Facility in the current year. We also paid less dividends to common stockholders in the current year,
primarily due to the payment of a one-time special dividend in connection with the IAA acquisition in the prior year, higher cash inflows from our employee
share purchase plan and higher proceeds from the exercise of stock options, driven by a higher share price.
Dividend Information
We declared and paid a regular cash dividend of $0.29 per common share for the quarters ended September 30, 2024, and June 30, 2024, and $0.27 per
common share for the quarters ended March 31, 2024, December 31, 2023, September 30, 2023, and June 30, 2023. On March 7, 2023, we declared a special
cash dividend of $1.08 per share, payable to stockholders of record at the close of business on March 17, 2023, excluding holders of Series A Senior Preferred
Shares (the “Special Dividend”). The Special Dividend was paid in cash on March 28, 2023, following the acquisition of IAA. We have declared, but not yet
paid, a dividend of $0.29 per common share for the quarter ended December 31, 2024. All dividends that we pay are “eligible dividends” for Canadian income
tax purposes unless indicated otherwise.
Critical Accounting Policies, Judgments, Estimates and Assumptions
In preparing our consolidated financial statements in conformity with US GAAP, we must make decisions that impact the reported amounts and related
disclosures. Such decisions include the selection of the appropriate accounting principles to be applied and the assumptions on which to base accounting
estimates. In reaching such decisions, we apply judgments based on our understanding and analysis of the relevant circumstances and historical experience.
The following discussion of critical accounting policies and estimates is intended to supplement the significant accounting policies presented in the notes to our
consolidated financial statements included in “Part II, Item 8: Financial Statements and Supplementary Data” presented in this Annual Report on Form 10-K,
which summarize the accounting policies and methods used in the preparation of those consolidated financial statements. The policies and the estimates
discussed below are included here because they require more significant judgments and estimates in the preparation and presentation of our consolidated
financial statements than other policies and estimates. Actual amounts could differ materially from those estimated by us at the time our consolidated financial
statements are prepared.
Business Combinations
Accounting for business combinations requires estimates with respect to the fair value of the assets acquired and liabilities assumed. Such estimates of fair
value require valuation methods, which rely on significant estimates and assumptions, especially for intangible assets. In connection with the IAA purchase
price allocation, which was finalized in the first quarter of 2024, the valuation of intangible assets required significant estimates and assumptions, and the
valuations of property, plant, and equipment, and operating lease right-of-use assets also required estimates and assumptions.
The valuation of customer relationship intangible assets was performed using the multi-period excess earnings method of the income approach and required
significant estimates and assumptions regarding revenue growth rates and discount rates, and the valuation of other acquired intangible assets was performed
using the relief from royalty method of the income approach and required estimates and assumptions regarding revenue growth rates, royalty rates, customer
attrition rates, and discount rates, as applicable. The Company based these estimates on historical and anticipated results, industry trends, economic analysis,
and various other assumptions, including assumptions as to the occurrence of future events. The discount rates used to discount expected cash flows to present
values were derived from a weighted average cost of capital analysis and adjusted to reflect inherent risks. The valuation of most acquired property, plant, and
equipment, other than land, was performed using the replacement cost method of the cost approach and required certain estimates and assumptions regarding
estimates of replacement cost and adjustments to account for physical deterioration and obsolescence. The fair value of most acquired land and the off-market
component of right-of-use assets were estimated using sales comparison method of the market approach and included certain estimates and assumptions with
respect to market value or market rents, growth rates, and discount rates, as applicable.
Goodwill
We test goodwill for impairment as at December 31, or more frequently whenever events or circumstances change that would more likely than not reduce the
fair value of a reporting unit below its carrying amount. We have the option to first perform a qualitative assessment of a reporting unit by assessing qualitative
factors. If it is determined that it is more likely than not that the reporting unit’s fair value is less than its carrying value, a quantitative impairment assessment
is performed to identify potential goodwill impairment. The reporting unit’s fair value is determined using various valuation approaches and techniques that
involve assumptions based on what management believes a hypothetical marketplace participant would use in estimating fair value on the measurement date.
Fair value determinations require considerable judgment and can be sensitive to changes in underlying assumptions. Typically, for our reporting units, under an
income approach method, the key assumptions and estimates that impact the estimated fair value include
RB Global, Inc.
44
Table of Contents
revenue, earnings growth rates and the discount rate. For valuations performed under the market approach, the key assumptions and estimates would include
the selection of guideline public companies and transactions comparable to the reporting unit.
An impairment loss is recognized as the difference between the reporting unit’s carrying amount and its fair value. If the difference between the reporting unit’s
carrying amount and fair value is greater than the amount of goodwill allocated to the reporting unit, the impairment loss is restricted by the amount of the
goodwill allocated to the reporting unit.
Prior to December 31, 2024, we had the following reporting units: Ritchie Bros., IAA, Listings Services, Rouse, SmartEquip and VeriTread; however, in the
fourth quarter of 2024, based on a change in how management evaluates these businesses, the former Rouse, SmartEquip, VeriTread and Listings Services
businesses were combined into our Services reporting unit. As the Company reorganized its reporting structure as at December 31, 2024, we performed
goodwill impairment testing immediately before (Listings Services and Rouse reporting units using a qualitative approach, and SmartEquip and VeriTread
reporting units using a quantitative approach that utilizes both income and market approaches) and after the reorganization of the reporting units that were
impacted by performing a qualitative assessment, and concluded that there were no impairment indicators. In addition, at December 31, 2024, we performed
goodwill impairment testing for our Ritchie Bros. reporting unit using a qualitative approach and for our IAA reporting unit using a quantitative approach, and
also concluded that there was no impairment.
Based on the Company’s annual goodwill impairment testing as of December 31, 2024, management concluded that there are no reporting units that are at
material risk of being impaired.
Income Taxes
The accounting for the Company's position in regards to the NOA received from the CRA, described in Item 8: Financial Statements and Supplementary Data -
Note 3 Significant Judgments, Estimates and Assumptions, also required significant judgment and an assessment over whether it is more likely than not that the
Company's tax position will be sustained. The matter required management to evaluate the tax technical merits and assess the likelihood of its resolution at
appeals or through litigation.
Adoption of New Standards
For a discussion of our new and amended accounting standards refer to "Part II, Item 8: Financial Statements and Supplementary Data - Note 2 Significant
Accounting Policies" of this Annual Report on Form 10-K.
Recent Accounting Pronouncements
Recent accounting pronouncements that significantly impact our accounting policies or the presentation of our consolidated financial position or performance
have been disclosed in the notes to our consolidated financial statements included in "Part II, Item 8: Financial Statements and Supplementary Data - Note 2
Significant Accounting Policies" of this Annual Report on Form 10-K.
Non-GAAP Measures
We reference various non-GAAP measures throughout this Annual Report on Form 10-K. These measures do not have a
standardized meaning and are, therefore, unlikely to be comparable to similar measures presented by other companies. The
presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not
intended to be considered in isolation of, or as a substitute for, the financial information prepared and presented in accordance with US
GAAP.
RB Global, Inc.
45
Table of Contents
Adjusted Net Income Attributable to Common Stockholders and Diluted Adjusted EPS Attributable to Common Stockholders Reconciliation
We believe that adjusted net income available to common stockholders provides useful information about the growth or decline of our
net income available to common stockholders for the relevant financial period, and eliminates the financial impact of adjusting items
we do not consider to be part of our normal operating results. Diluted adjusted EPS available to common stockholders eliminates the
financial impact of adjusting items from net income available to common stockholders that we do not consider to be part of our normal
operating results.
Adjusted net income available to common stockholders is calculated as net income available to common stockholders, excluding the
effects of adjusting items that we do not consider to be part of our normal operating results, such as share-based payments expense,
acquisition-related and integration costs, amortization of acquired intangible assets, executive transition costs and certain other items.
Net income available to common stockholders is calculated as net income attributable to controlling interests, less cumulative
dividends on Series A Senior Preferred Shares and allocated earnings to participating securities.
Diluted adjusted EPS available to common stockholders is calculated by dividing adjusted net income available to common
stockholders by the weighted average number of dilutive shares outstanding, except that it is computed based upon the lower of the
two-class method or the if-converted method, which includes the effects of the assumed conversion of the Series A Senior Preferred
Shares and the effect of shares issuable under the Company’s stock-based incentive plans, if such effect is dilutive.
Please refer to page 50 for a summary of adjusting items.
The following table reconciles adjusted net income available to common stockholders and diluted adjusted EPS available to common
stockholders to net income available to common stockholders and diluted EPS available to common stockholders, which are the most
directly comparable GAAP measures in our consolidated financial statements:
Year ended December 31,
% Change
(in U.S. dollars in millions, except share, per share data, and
percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
Net income available to common stockholders
$
372.7
$
174.9
$
319.7
113 %
(45)%
Share-based payments expense
56.3
45.5
37.0
24 %
23 %
Acquisition-related and integration costs
29.0
216.1
37.3
(87)%
479 %
Amortization of acquired intangible assets
274.9
226.2
33.4
22 %
577 %
(Gain) on disposition of property, plant and equipment and related costs
(1.2)
(0.8)
(166.9)
50 %
(100)%
Prepaid consigned vehicle charges
(4.7)
(67.0)
—
(93)%
NM
Loss on redemption of the 2016 and 2021 Notes and certain related interest
expense
—
3.3
9.7
NM
(66)%
Change in fair value of derivatives
—
—
(1.3)
NM
NM
Other legal, advisory, restructuring and non-income tax expenses
13.4
2.0
5.0
570 %
(60)%
Executive transition costs
6.7
12.0
—
(44)%
NM
Remeasurements in connection with business combinations
1.2
(2.9)
—
NM
NM
Related tax effects of the above
(91.4)
(95.8)
(4.0)
(5)%
2295 %
Related allocation of the above to participating securities
(10.1)
(11.3)
—
(11)%
NM
Adjusted net income available to common stockholders
$
646.8
$
502.2
$
269.9
29 %
86 %
Weighted average number of dilutive shares outstanding
185,254,557
168,203,981
111,886,025
10 %
50 %
Diluted earnings per share available to common stockholders
$
2.01
$
1.04
$
2.86
93 %
(64)%
Diluted adjusted earnings per share available to common stockholders
$
3.49
$
2.99
$
2.41
17 %
24 %
NM = Not meaningful
RB Global, Inc.
46
Table of Contents
Adjusted EBITDA
We believe adjusted EBITDA provides useful information about the growth or decline of our net income when compared between
different financial periods. We use adjusted EBITDA as a key performance measure because we believe it facilitates operating
performance comparisons from period to period and it provides management with the ability to monitor its controllable incremental
revenues and costs.
Adjusted EBITDA is calculated by adding back depreciation and amortization, interest expense, income tax expense, and subtracting
interest income from net income, as well as adding back the adjusting items as described on page 50.
The following table reconciles adjusted EBITDA to net income, which is the most directly comparable GAAP measure in, or
calculated from, our consolidated financial statements:
Year ended December 31,
% Change
2024 over
2023 over
(in U.S. dollars in millions, except percentages)
2024
2023
2022
2023
2022
Net income
$
412.8
$
206.0
$
319.8
100 %
(36)%
Add: depreciation and amortization
444.4
352.2
97.2
26 %
262 %
Add: interest expense
233.7
213.8
57.9
9 %
269 %
Less: interest income
(26.2)
(22.0)
(7.0)
19 %
214 %
Add: income tax expense
137.3
76.4
86.2
80 %
(11)%
EBITDA
1,202.0
826.4
554.1
45 %
49 %
Share-based payments expense
56.3
45.5
37.0
24 %
23 %
Acquisition-related and integration costs
29.0
216.1
37.3
(87)%
479 %
(Gain) loss on disposition of property, plant and equipment and related costs
(1.2)
(0.8)
(166.9)
50 %
(100)%
Prepaid consigned vehicle charges
(4.7)
(67.0)
—
(93)%
NM
Change in fair value of derivatives
—
—
(1.3)
NM
NM
Other legal, advisory, restructuring and non-income tax expenses
13.4
2.0
5.0
570 %
(60)%
Executive transition costs
6.7
12.0
—
(44)%
NM
Remeasurements in connection with business combinations
1.2
(1.4)
—
NM
NM
Adjusted EBITDA
$
1,302.7
$
1,032.8
$
465.2
26 %
122 %
NM = Not meaningful
RB Global, Inc.
47
Table of Contents
Adjusted Net Debt and Adjusted Net Debt/ Adjusted EBITDA Reconciliation
We believe that comparing adjusted net debt/adjusted EBITDA on a trailing twelve-month basis for different financial periods
provides useful information about the performance of our operations, as an indicator of the amount of time it would take us to settle
both our short and long-term debt. We do not consider this to be a measure of our liquidity, which is our ability to settle only short-term obligations, but rather a
measure of how well we fund liquidity. Measures of liquidity are noted under “Liquidity and Capital
Resources".
Adjusted net debt is calculated by subtracting cash and cash equivalents from short and long-term debt and long-term debt in escrow.
Adjusted net debt/Adjusted EBITDA is calculated by dividing adjusted net debt by adjusted EBITDA.
The following table reconciles adjusted net debt to debt, adjusted EBITDA to net income, and adjusted net debt/ adjusted EBITDA to
debt/ net income, respectively, which are the most directly comparable GAAP measures in, or calculated from, our consolidated
financial statements. Please refer to page 50 for a summary of adjusting items.
Year ended December 31,
% Change
(in U.S. dollars in millions, except percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
Short-term debt
$
27.7
$
13.7
$
29.1
102 %
(53)%
Long-term debt
2,626.2
3,075.8
581.5
(15)%
429 %
Debt
2,653.9
3,089.5
610.6
(14)%
406 %
Less: cash and cash equivalents
(533.9)
(576.2)
(494.3)
(7)%
17 %
Adjusted net debt
2,120.0
2,513.3
116.3
(16)%
2061 %
Net income
$
412.8
$
206.0
$
319.8
100 %
(36)%
Add: depreciation and amortization
444.4
352.2
97.1
26 %
263 %
Add: interest expense
233.7
213.8
57.9
9 %
269 %
Less: interest income
(26.2)
(22.0)
(7.0)
19 %
214 %
Add: income tax expense
137.3
76.4
86.2
80 %
(11)%
EBITDA
1,202.0
826.4
554.0
45 %
49 %
Share-based payments expense
56.3
45.5
37.0
24 %
23 %
Acquisition-related and integration costs
29.0
216.1
37.3
(87)%
479 %
(Gain) on disposition of property, plant and equipment and related costs
(1.2)
(0.8)
(166.9)
50 %
(100)%
Prepaid consigned vehicle charges
(4.7)
(67.0)
—
(93)%
NM
Change in fair value of derivatives
—
—
(1.3)
NM
NM
Other legal, advisory, restructuring and non-income tax expenses
13.4
2.0
5.1
570 %
(61)%
Executive transition costs
6.7
12.0
—
(44)%
NM
Remeasurements in connection with business combinations
1.2
(1.4)
—
NM
NM
Adjusted EBITDA
$
1,302.7
$
1032.8
$
465.2
26 %
122 %
Debt/net income
6.4 x
15.0 x
1.9 x
(57)%
689 %
Adjusted net debt/adjusted EBITDA
1.6 x
2.4 x
0.3 x
(33)%
700 %
NM = Not meaningful
Adjusted Return and Adjusted ROIC Reconciliation
We believe that comparing adjusted ROIC on a trailing twelve-month basis for different financial periods provides useful information
about the after-tax return generated by our investments. Adjusted ROIC is a measure used by management to determine how
productively the Company uses its long-term capital to gauge investment decisions.
ROIC is calculated as reported return divided by average invested capital. Reported return is defined as net income attributable to
controlling interests excluding the impact of net interest expense and tax effected at the Company’s adjusted annualized effective tax rate. Adjusted ROIC is
calculated as adjusted return divided by adjusted average invested capital. Adjusted return is defined as reported return and adjusted for items that we do not
consider to be part of our normal operating results and tax effected at the applicable tax rate.
RB Global, Inc.
48
Table of Contents
Adjusted average invested capital is calculated as average invested capital but excludes any long-term debt in escrow. Please refer to page 50 for a summary of
adjusting items.
The following table reconciles adjusted return and adjusted ROIC to net income attributable to controlling interests and adjusted
average invested capital to average invested capital, which are the most directly comparable GAAP measures in, or calculated from,
our consolidated financial statements:
Year ended December 31,
% Change
(in U.S. dollars in millions, except percentages)
2024
2023
2022
2024 over 2023
2023 over 2022
Net income attributable to controlling interests
$
413.1
$
206.5
$
319.7
100 %
(35)%
Add:
Interest expense
233.7
213.8
57.9
9 %
269 %
Interest income
(26.2)
(22.0)
(7.0)
19 %
214 %
Interest, net
207.5
191.8
50.9
8 %
277 %
Tax on interest, net
(51.3)
(46.0)
(12.7)
12 %
262 %
Reported return
$
569.3
$
352.3
$
357.9
62 %
(2)%
Add:
Share-based payments expense
56.3
45.5
37.0
24 %
23 %
Acquisition-related and integration costs
29.0
216.1
37.3
(87)%
479 %
Amortization of acquired intangible assets
274.9
226.2
33.4
22 %
577 %
(Gain) loss on disposition of property, plant and equipment and related costs
(1.2)
(0.8)
(166.9)
50 %
(100)%
Prepaid consigned vehicle charges
(4.7)
(67.0)
—
(93)%
(100)%
Change in fair value of derivatives
—
—
(1.3)
— %
(100)%
Other legal, advisory, restructuring and non-income tax expenses
13.4
2.0
5.1
570 %
(61)%
Executive transition costs
6.7
12.0
—
(44)%
100 %
Remeasurements in connection with business combinations
1.2
(2.9)
—
(143)%
(100)%
Related tax effects of the above
(91.4)
(95.8)
(4.0)
(5)%
2295 %
Adjusted return
$
853.5
$
687.6
$
298.5
24 %
130 %
Short-term debt - opening balance
$
13.7
$
29.1
$
6.1
(53)%
377 %
Short-term debt - ending balance
27.7
13.7
29.1
102 %
(53)%
Average short-term debt
20.7
21.4
17.6
(3)%
22 %
Long-term debt - opening balance
3,075.8
581.5
1,737.4
429 %
(67)%
Less: long-term debt in escrow
—
—
(933.5)
— %
(100)%
Adjusted opening long-term debt
3,075.8
581.5
803.9
429 %
(28)%
Long-term debt - ending balance
2,626.2
3,075.8
581.5
(15)%
429 %
Less: long-term debt in escrow
—
—
—
— %
— %
Adjusted ending long-term debt
2,626.2
3,075.8
581.5
(15)%
429 %
Average long-term debt
2,851.0
1,828.7
1,159.5
56 %
58 %
Adjusted average long-term debt
2,851.0
1,828.7
692.7
56 %
164 %
Preferred equity - opening balance
482.0
—
—
100 %
— %
Preferred equity - ending balance
482.0
482.0
—
— %
100 %
Average preferred equity
482.0
241.0
—
100 %
100 %
Stockholders' equity - opening balance
5,016.7
1,289.6
1,070.7
289 %
20 %
Stockholders' equity - ending balance
5,224.0
5,016.7
1,289.6
4 %
289 %
Average stockholders' equity
5,120.4
3,153.2
1,180.2
62 %
167 %
Average invested capital
$
8,474.1
$
5,244.3
$
2,357.3
62 %
122 %
Adjusted average invested capital
$
8,474.1
$
5,244.3
$
1,890.5
62 %
177 %
ROIC
6.7 %
6.7 %
15.2 %
0bps
(850)bps
Adjusted ROIC
10.1 %
13.1 %
15.8 %
(300)bps
(270)bps
NM = Not meaningful
RB Global, Inc.
49
Table of Contents
Adjusting items for the year ended December 31, 2024:
Recognized in the fourth quarter of 2024
•
$15.2 million share-based payments expense.
•
$6.1 million of acquisition-related and integration costs, primarily relating to severance and integration activities in connection with the acquisition of
IAA.
•
$68.5 million amortization of acquired intangible assets from acquisitions.
•
$0.7 million relating to a fair value adjustment made to the prepaid consigned vehicle charges on the opening balance sheet of IAA at acquisition.
•
$1.3 million of other legal, advisory, restructuring and non-income tax expenses, including costs incurred with the CRA dispute.
•
$2.4 million of estimated executive transition costs, primarily estimated settlement and legal amounts associated with the departure of our former CEO on
August 1, 2023.
Recognized in the third quarter of 2024
•
$9.7 million share-based payments expense.
•
$6.0 million of acquisition-related and integration costs, primarily relating to the acquisition of IAA.
•
$67.9 million amortization of acquired intangible assets from past acquisitions.
•
$0.2 million loss on disposition of property, plant and equipment and related costs, primarily driven by non-cash costs arising from the accounting for the
sale of the Bolton property, recorded in selling, general and administrative cost, partially offset by a $0.5 million gain on the disposition of property, plant
and equipment.
•
$0.6 million relating to a fair value adjustment made to the prepaid consigned vehicle charges on the opening balance sheet of IAA at acquisition.
•
$2.2 million of other legal, advisory, restructuring and non-income tax expenses, which primarily includes an estimated accrual for the settlement amount
of an unusual legal claim recorded in other income (loss), as well as terminated and ongoing transaction costs recorded in selling, general and
administrative costs.
•
$0.6 million of estimated executive transition costs, primarily legal costs, associated with the departure of our former CEO on August 1, 2023.
•
$1.2 million of remeasurements in connection with a business combination which relates to the revaluation of a contingent consideration liability for IAA's
acquisition of Marisat, Inc. in 2021.
Recognized in the second quarter of 2024
•
$18.1 million share-based payments expense.
•
$4.1 million of acquisition-related and integration costs, primarily relating to the acquisition of IAA.
•
$69.0 million amortization of acquired intangible assets from past acquisitions.
•
$0.4 million loss on disposition of property, plant and equipment and related costs, primarily driven by non-cash costs arising from the accounting for the
sale of the Bolton property, recorded in selling, general and administrative costs.
•
$1.3 million relating to a fair value adjustment made to the prepaid consigned vehicle charges on the opening balance sheet of IAA at acquisition.
•
$7.7 million of other legal, advisory, restructuring and non-income tax expenses, which includes an estimated accrual for a new digital services tax in
Canada on certain in-scope revenues earned for the period from January 1, 2022 to June 30, 2024, legal costs in connection with the settlement of an
unusual legal claim accrued in the first quarter of 2024, as well as terminated and ongoing transaction costs.
•
$2.0 million of estimated executive transition costs associated with the departure of our former CEO on August 1, 2023, which includes estimated
settlement amounts and related costs.
Recognized in the first quarter of 2024
•
$13.3 million share-based payments expense.
•
$12.8 million of acquisition-related and integration costs primarily relating to the acquisition of IAA.
•
$69.6 million amortization of acquired intangible assets from past acquisitions, of which $61.9 million related to the acquired intangible assets from the
acquisition of IAA.
•
$1.8 million gain on disposition of property, plant and equipment and related costs, primarily driven by a $2.2 million gain on a lease modification, offset
by non-cash costs arising from the accounting for the sale of the Bolton property, recorded in selling, general and administrative costs.
•
$2.1 million relating to a fair value adjustment made to the prepaid consigned vehicle charges on the opening balance sheet of IAA, which do not have a
future benefit at acquisition, and therefore has created a favorable reduction to our cost of services in the quarter.
RB Global, Inc.
50
Table of Contents
•
$2.2 million of other advisory, legal and restructuring costs, which primarily includes a $1.9 million loss on the settlement of an unusual legal claim
recorded in other income, $0.3 million of terminated and ongoing transaction costs and $0.1 million of costs incurred with the CRA's investigation.
•
$1.7 million of estimated executive transition costs associated with the departures of certain executives on August 1, 2023, which includes severance,
estimated settlement amounts and related costs.
The adjusting items recognized in our prior quarters are discussed in "Part II, Item 7: Management’s Discussion and Analysis of Financial Condition and
Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023.
ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Foreign Currency Exchange Rate Risk
We conduct operations in local currencies in countries around the world and the functional currency of our subsidiaries outside of the United States is generally
the applicable local currency. Our consolidated financial statements are presented in U.S. dollars. As a result, we are exposed to currency fluctuations and
exchange rate risk. We cannot accurately predict the future effects of foreign currency fluctuations on our financial condition or results of operations, nor
quantify their effects on the macroeconomic environment. The proportion of revenues denominated in currencies other than the U.S. dollar in a given period
may differ from the annual proportion for the year ended December 31, 2024, which was 27%, and depends on the size and location of auctions held during the
period. On an annual basis, we expect fluctuations in revenues and operating expenses to largely offset and generally act as a natural hedge against exposure to
fluctuations in the value of the U.S. dollar.
During 2024, we recorded a foreign currency translation adjustment loss of $80.8 million, compared to income of $41.1 million in 2023. Our foreign currency
translation adjustment, which is recorded as a component of consolidated other comprehensive income (loss), arises from the translation of our net assets
denominated in currencies other than the U.S. dollar to the U.S. dollar for reporting purposes. Based on our exposures to foreign currency exchange rate risk at
December 31, 2024, and assuming all other variables remain constant, a 10% change in the Canadian dollar, GBP and Euro against the U.S. dollar would have
resulted in an additional foreign currency translation adjustment of approximately $113.0 million within consolidated other comprehensive income (loss).
We also have foreign exchange rate risk related to our intercompany balances denominated in various currencies other than the U.S dollar. However, we enter
into forward contracts to protect against such foreign currency exchange rate risks. As such, after consideration of the effect of foreign exchange contracts in
place at December 31, 2024, a 10% foreign currency exchange rate change would not have a significant impact on our net income.
Interest Rate Risk
Loans under our syndicated and foreign credit facilities bear interest, at our option, at a rate equal to either a base rate (or Canadian prime rate for certain
Canadian dollar borrowings) or floating rate customarily used by the syndicate and depending on the borrowing currency, including SOFR, SONIA, €STR,
EURIBOR, TIBOR, CORRA, and BBSY. In either case, an applicable margin is added to the rate. At December 31, 2024, we had a total of $1.3 billion in loans
(facilities drawn and term loans) bearing floating rates of interest, as compared to $1.8 billion at December 31, 2023. Based on the amount owing at
December 31, 2024, and assuming all other variables remain constant, a change in the interest rate by 100 bps would result in an increase/decrease of
approximately $13.3 million in the pre-tax interest we accrue per annum.
At December 31, 2024, fixed rate debt on our senior secured and unsecured notes represents 51% of our long-term debt and bears interest at a fixed rate of
6.750% per annum for the senior secured notes and 7.750% per annum for the senior unsecured notes. We continue to monitor our exposure to interest rate risk,
and while we have not adopted a long-term hedging strategy to protect against interest rate fluctuations associated with our variable rate debt, we may consider
hedging specific borrowings if we deem it appropriate in the future.
RB Global, Inc.
51
Table of Contents
ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of RB Global, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of RB Global, Inc. (the Company) as of December 31, 2024 and 2023, the related consolidated
statements of income, comprehensive income, changes in temporary equity and stockholders’ equity, and cash flows, for each of the two years in the period
ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial
statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its
cash flows for each of the two years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal
control over financial reporting as of December 31, 2024, based on criteria established in Internal Control-Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 26, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial
statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to
assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such
procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating
the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We
believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to
be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our
especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the
consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the
critical audit matter or on the account or disclosures to which it relates.
RB Global, Inc.
52
Table of Contents
Uncertain Tax Position – Canada Revenue Agency ("CRA") matter
Description of the
Matter
As discussed in Notes 2, 3 and 8 of the consolidated financial statements, the Company is subject to income taxes in the U.S., Canada
and other foreign jurisdictions during the ordinary course of business, including tax positions for which the ultimate tax determination
is uncertain. Liabilities for uncertain tax positions are recognized in accordance with ASC 740, Income Taxes. The Company evaluates
the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the
position will be sustained based on the tax technical merits, including resolution of related appeals or litigation processes, if any.
Recognized income tax positions are measured at the largest amount that is more than likely of being realized.
As disclosed in Note 8, on December 3, 2024, the CRA issued the Company a Notice of Assessment and Statement of Interest
(“NOA”) for C$79.1 million (approximately $55.1 million), for the taxation years 2010 through 2015, inclusive of C$37.7 million in
income taxes (approximately $26.3 million), and C$41.4 million in interest and penalties (approximately $28.9 million). The CRA is
asserting that one of the Company’s Luxembourg subsidiaries which was in operation from 2010 to 2020 was resident in Canada from
2010 through 2015 and that its worldwide income should be subject to Canadian income taxation. The CRA also requested, in the
third quarter of 2024, additional information for the 2016 through 2020 tax years; however, has not issued a NOA for that period.
At December 31, 2024, the Company has not recorded any UTP liabilities relating to these matters in the consolidated financial
statements because it is the Company’s conclusion that it is more likely than not that the Company’s tax filing positions will ultimately
be sustained.
As a result, significant judgment is required in evaluating the Company’s uncertain tax positions relating to the above matters for the
period 2010 through 2020, notably as it relates to whether the tax position’s technical merits are more likely than not to be sustained.
Auditing the Company’s positions in regard to the CRA matter was especially challenging because the evaluation of whether a tax
position is more likely than not to be sustained is complex and involves significant auditor judgment including interpretation of
jurisdiction-specific tax legislation and related case law.
How We Addressed
the Matter in Our
Audit
We obtained an understanding, evaluated the design, and tested the effectiveness of controls over the Company’s process to assess the
technical merits of the income tax position underlying the CRA matters, including controls over the assessment as to whether the tax
position is more likely than not to be sustained, and the development of the related financial statement disclosures.
Our audit procedures included, among others, evaluating the technical merits underlying the CRA matters that the Company used to
assess its uncertain tax positions. We involved our international tax professionals in assessing the technical merits of the Company’s
tax positions relating to the CRA matters, including but not limited to the Company’s internal analyses and memoranda, external legal
opinions obtained by the Company as to applicable tax and case law, documentation received from and provided to the CRA and
evaluating the underlying facts and evidence upon which the Company’s income tax positions are based. We also made inquiries of
management, internal and external counsel, and obtained written representations from management as to certain aspects of the CRA
matter. We used our knowledge, including the use of professionals with specialized skill and knowledge of and experience with
international income tax laws of the relevant taxing jurisdictions to evaluate the Company’s accounting for the CRA matter. We
evaluated developments in the applicable regulatory environments to assess potential effects on the Company’s positions, including
recent decisions in relevant court cases. Additionally, we evaluated the Company’s disclosures of the uncertain tax positions in relation
to the CRA matter.
/s/
Ernst & Young LLP
We have served as the Company’s auditor since 2023.
Chicago, Illinois
February 26, 2025
RB Global, Inc.
53
Table of Contents
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of RB Global, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of income, comprehensive income, changes in temporary equity and stockholders’ equity and cash
flows of RB Global, Inc. (the “Company”) for the year ended December 31, 2022, and the related notes (collectively referred to as the “consolidated financial
statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the results of its operations and its cash flows for the
year ended December 31, 2022, in conformity with U.S. generally accepted accounting principles.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial
statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”)
and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of
the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to
assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such
procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating
the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We
believe that our audit provides a reasonable basis for our opinion.
/s/
Ernst & Young LLP
Chartered Professional Accountants
We served as the Company‘s auditor from 2013 to 2023.
Vancouver, Canada
February 21, 2023
RB Global, Inc.
54
Table of Contents
Consolidated Income Statements
(Expressed in millions of U.S. dollars, except share and per share data)
Year ended December 31,
2024
2023
2022
Revenue:
Service revenue
$
3,363.6 $
2,732.5 $
1,050.6
Inventory sales revenue
920.6
947.1
683.2
Total revenue
4,284.2
3,679.6
1,733.8
Operating expenses:
Costs of services
1,415.7
1,007.6
168.1
Cost of inventory sold
863.8
893.6
608.6
Selling, general and administrative
773.9
743.7
539.9
Acquisition-related and integration costs
29.0
216.1
37.3
Depreciation and amortization
444.4
352.2
97.2
Total operating expenses
3,526.8
3,213.2
1,451.1
Gain on disposition of property, plant and equipment
3.8
4.9
170.8
Operating income
761.2
471.3
453.5
Interest expense
(233.7)
(213.8)
(57.9)
Interest income
26.2
22.0
7.0
Change in fair value of derivatives, net
—
—
1.3
Other (loss) income, net
(1.7)
4.7
1.1
Foreign exchange (loss) gain
(1.9)
(1.8)
1.0
Income before income taxes
550.1
282.4
406.0
Income tax expense
137.3
76.4
86.2
Net income
$
412.8 $
206.0 $
319.8
Net income (loss) attributable to:
Controlling interests
$
413.1 $
206.5 $
319.7
Non-controlling interests
—
—
0.1
Redeemable non-controlling interests
(0.3)
(0.5)
—
Net income
$
412.8 $
206.0 $
319.8
Net income attributable to controlling interests:
413.1
206.5
319.7
Cumulative dividends on Series A Senior Preferred Shares
(26.7)
(24.3)
—
Allocated earnings to Series A Senior Preferred Shares
(13.7)
(7.3)
—
Net income available to common stockholders
$
372.7 $
174.9 $
319.7
Earnings per share available to common stockholders:
Basic
$
2.03 $
1.05 $
2.89
Diluted
$
2.01 $
1.04 $
2.86
Weighted average number of shares outstanding:
Basic
183,958,258
166,963,575
110,781,282
Diluted
185,254,557
168,203,981
111,886,025
See accompanying notes to the consolidated financial statements.
RB Global, Inc.
55
Table of Contents
Consolidated Statements of Comprehensive Income
(Expressed in millions of U.S. dollars)
Year ended December 31,
2024
2023
2022
Net income
$
412.8 $
206.0 $
319.8
Other comprehensive income (loss), net of income tax:
Foreign currency translation adjustments
(80.8)
41.1
(29.1)
Comprehensive income
$
332.0 $
247.1 $
290.7
Comprehensive income (loss) attributable to:
Controlling interests
$
332.3 $
247.6 $
290.6
Non-controlling interests
—
—
0.1
Redeemable non-controlling interests
(0.3)
(0.5)
—
Comprehensive income
$
332.0 $
247.1 $
290.7
See accompanying notes to the consolidated financial statements.
RB Global, Inc.
56
Table of Contents
Consolidated Balance Sheets
(Expressed in millions of U.S. dollars, except share data)
December 31,
2024
December 31,
2023
Assets
Current assets:
Cash and cash equivalents
$
533.9
$
576.2
Restricted cash
174.9
171.7
Trade and other receivables, net of allowance for credit losses of $7.2 and $6.4, respectively
709.4
731.5
Prepaid consigned vehicle charges
67.9
66.9
Inventory
121.5
166.5
Other current assets
77.0
91.2
Income taxes receivable
30.2
10.0
Total current assets
1,714.8
1,814.0
Property, plant and equipment, net
1,275.4
1,200.9
Operating lease right-of-use assets
1,529.1
1,475.5
Other non-current assets
98.4
85.6
Intangible assets, net
2,668.7
2,914.1
Goodwill
4,511.8
4,537.0
Deferred tax assets
8.8
10.3
Total assets
$
11,807.0
$
12,037.4
Liabilities, Temporary Equity and Stockholders' Equity
Current liabilities:
Auction proceeds payable
$
378.0
$
502.5
Trade and other liabilities
782.0
685.8
Current operating lease liabilities
113.3
118.0
Income taxes payable
26.2
8.5
Short-term debt
27.7
13.7
Current portion of long-term debt
4.1
14.2
Total current liabilities
1,331.3
1,342.7
Long-term operating lease liabilities
1,431.1
1,354.3
Long-term debt
2,622.1
3,061.6
Other non-current liabilities
97.4
86.7
Deferred tax liabilities
608.7
682.7
Total liabilities
6,090.6
6,528.0
Temporary equity:
Series A Senior Preferred Shares; shares authorized, issued and outstanding: 485,000,000 (December 31, 2023: 485,000,000)
482.0
482.0
Redeemable non-controlling interest
8.1
8.4
Stockholders' equity:
Senior preferred and junior preferred stock; unlimited shares authorized; shares issued and outstanding,
other than Series A Senior Preferred Shares: nil (December 31, 2023: nil)
—
—
Common stock, no par value; unlimited shares authorized; shares issued and outstanding: 184,732,582 (December 31, 2023:
182,843,942)
4,163.1
4,054.2
Additional paid-in capital
95.4
88.0
Retained earnings
1,090.3
918.5
Accumulated other comprehensive loss
(124.8)
(44.0)
Stockholders' equity
5,224.0
5,016.7
Non-controlling interests
2.3
2.3
Total stockholders' equity
5,226.3
5,019.0
Total liabilities, temporary equity and stockholders' equity
$
11,807.0
$
12,037.4
See accompanying notes to the consolidated financial statements.
RB Global, Inc.
57
Table of Contents
Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity
(Expressed in millions of U.S. dollars, except where noted)
Redeemable
non-
controlling
interest
Attributable to common stockholders
Non-
controlling
interest
Total
stockholders'
equity
Series A Senior Preferred
Shares
Common stock
Additional
paid-In
capital
Retained
earnings
Accumulated
other
comprehensive
loss
Shares
Amount
Shares
Amount
Balance, December 31, 2021
—
$
—
$
—
110,618,049
$
227.5
$
59.5
$
839.6
$
(56.0)
$
0.5
$
1,071.1
Net income
—
—
—
—
—
—
319.7
—
—
319.7
Other comprehensive loss
—
—
—
—
—
—
—
(29.1)
—
(29.1)
Stock option exercises
—
—
—
159,920
7.2
(1.4)
—
—
—
5.8
Issuance of common stock related to vesting of
share units
—
—
—
103,394
3.0
(6.8)
—
—
—
(3.8)
Share-based continuing employment costs related
to business combinations
—
—
—
—
8.6
(1.1)
—
—
—
7.5
Share-based payments expense
—
—
—
—
—
34.2
—
—
—
34.2
Equity-classified share units dividend equivalents
—
—
—
—
—
0.9
(0.9)
—
—
—
Dividends paid to common stockholders
—
—
—
—
—
—
(115.2)
—
—
(115.2)
Balance, December 31, 2022
—
$
—
$
—
110,881,363
$
246.3
$
85.3
$
1,043.2
$
(85.1)
$
0.5
$
1,290.1
Net income (loss)
—
—
(0.5)
—
—
—
206.5
—
—
206.5
Other comprehensive income
—
—
—
—
—
—
—
41.1
—
41.1
Stock option exercises
—
—
—
723,443
42.9
(8.4)
—
—
—
34.5
Issuance of common stock related to vesting of
share units
—
—
—
467,747
17.4
(36.4)
—
—
—
(19.0)
Issuance of common stock related to ESPP
—
—
—
180,503
11.4
(2.2)
—
—
—
9.2
Issuance of common stock related to business
combination
—
—
—
70,339,723
3,712.9
—
—
—
—
3,712.9
Share-based continuing employment costs related
to business combinations
—
—
—
—
8.3
(5.3)
—
—
—
3.0
Replacement of share-based awards in business
combination
—
—
—
—
—
13.1
—
—
—
13.1
Share-based payments expense
—
—
—
—
—
40.3
—
—
—
40.3
Equity-classified share units dividend equivalents
—
—
—
—
—
1.6
(1.6)
—
—
—
NCI acquired in business combination
—
—
8.9
—
—
—
—
—
1.8
1.8
Issuance of Series A Senior Preferred Shares and
common stock, net of issuance costs
485,000,000
482.0
—
251,163
15.0
—
—
—
—
15.0
Participating dividends on Series A Senior
Preferred Shares
—
—
—
—
—
—
(7.3)
—
—
(7.3)
Preferred dividends on Series A Senior Preferred
Shares
—
—
—
—
—
—
(24.3)
—
—
(24.3)
Dividends paid to common stockholders
—
—
—
—
—
—
(298.0)
—
—
(298.0)
Balance, December 31, 2023
485,000,000
$
482.0
$
8.4
182,843,942
$
4,054.2
$
88.0
$
918.5
$
(44.0)
$
2.3
$
5,019.0
RB Global, Inc.
58
Table of Contents
Redeemable
non-
controlling
interest
Attributable to common stockholders
Non-
controlling
interest
Total
stockholders'
equity
Series A Senior Preferred
Shares
Common stock
Additional
paid-In
capital
Retained
earnings
Accumulated
other
comprehensive
loss
Shares
Amount
Shares
Amount
Net income (loss)
—
—
(0.3)
—
—
—
413.1
—
—
413.1
Other comprehensive loss
—
—
—
—
—
—
—
(80.8)
—
(80.8)
Stock option exercises
—
—
—
1,044,547
61.4
(12.1)
—
—
—
49.3
Issuance of common stock related to vesting of
share units
—
—
—
335,372
14.3
(30.0)
—
—
—
(15.7)
Issuance of common stock related to ESPP
—
—
—
513,142
32.9
(6.7)
—
—
—
26.2
Share-based continuing employment costs related
to business combinations
—
—
—
(4,421)
0.3
(0.4)
—
—
—
(0.1)
Share-based payments expense
—
—
—
—
—
55.5
—
—
—
55.5
Equity-classified share units dividend equivalents
—
—
—
—
—
1.1
(1.1)
—
—
—
Participating dividends on Series A Senior
Preferred Shares
—
—
—
—
—
—
(7.5)
—
—
(7.5)
Preferred dividends on Series A Senior Preferred
Shares
—
—
—
—
—
—
(26.7)
—
—
(26.7)
Dividends paid to common stockholders
—
—
—
—
—
—
(206.0)
—
—
(206.0)
Balance, December 31, 2024
485,000,000
$
482.0
$
8.1
184,732,582
$
4,163.1
$
95.4
$
1,090.3
$
(124.8)
$
2.3
$
5,226.3
See accompanying notes to the consolidated financial statements.
RB Global, Inc.
59
Table of Contents
Consolidated Statements of Cash Flows
(Expressed in millions of U.S. dollars)
Year ended December 31,
2024
2023
2022
Cash provided by (used in):
Operating activities:
Net income
$
412.8
$
206.0
$
319.8
Adjustments for items not affecting cash:
Depreciation and amortization
444.4
352.2
97.2
Share-based payments expense
62.4
55.8
41.7
Deferred income tax benefit
(69.2)
(65.8)
(0.3)
Unrealized foreign exchange (gain) loss
(0.4)
6.6
(6.5)
Gain on disposition of property, plant and equipment
(3.8)
(4.9)
(170.8)
Allowance for expected credit losses
5.1
5.9
—
Loss on redemption of notes
—
3.3
4.8
Gain on remeasurement of investment upon acquisition
—
(1.4)
—
Amortization of debt issuance costs
12.5
10.1
3.9
Amortization of right-of-use assets
154.4
109.9
19.4
Inventory write-downs
14.9
7.0
—
Other, net
(1.3)
3.0
2.7
Net changes in operating assets and liabilities
(99.8)
(143.7)
151.2
Net cash provided by operating activities
932.0
544.0
463.1
Investing activities:
Acquisition of IAA, net of cash acquired
—
(2,753.9)
—
Acquisition of VeriTread, net of cash acquired
—
(24.7)
—
Acquisition of SmartEquip, net of cash acquired
—
—
(0.1)
Acquisition of Boom and Bucket, net of cash acquired
(8.6)
—
—
Property, plant and equipment additions
(167.4)
(227.9)
(32.0)
Proceeds on disposition of property, plant and equipment
2.6
32.6
165.5
Intangible asset additions
(109.5)
(118.3)
(40.0)
Repayment of loans receivable
8.1
4.0
5.5
Issuance of loans receivable
(24.1)
(18.8)
(22.0)
Other, net
(2.7)
(1.3)
0.3
Net cash (used in) provided by investing activities
(301.6)
(3,108.3)
77.2
Financing activities:
Issuance of Series A Senior Preferred Shares and common stock, net of issuance costs
—
496.9
—
Dividends paid to common stockholders
(206.0)
(298.0)
(115.2)
Dividends paid to Series A Senior Preferred shareholders
(34.2)
(30.4)
—
Proceeds from exercise of options and share option plans
75.5
43.7
5.9
Payment of withholding taxes on issuance of shares
(14.8)
(15.9)
(4.0)
Net increase (decrease) in short-term debt
14.5
(15.5)
0.8
Proceeds from long-term debt
—
3,175.0
—
Repayment of long-term debt
(454.4)
(654.4)
(1,131.0)
Payment of debt issue costs
(0.3)
(41.7)
(4.3)
Repayment of finance lease and equipment financing obligations
(26.5)
(19.2)
(10.3)
Proceeds of equipment financing obligations
2.6
37.6
—
Payment of contingent consideration
(1.9)
(1.9)
—
Net cash (used in) provided by financing activities
(645.5)
2,676.2
(1,258.1)
Effect of changes in foreign currency rates on cash, cash equivalents, and restricted cash
(24.0)
10.1
(18.8)
Net (decrease) increase in cash, cash equivalents, and restricted cash
(39.1)
122.0
(736.6)
Cash, cash equivalents, and restricted cash, beginning of period
747.9
625.9
1,362.5
Cash, cash equivalents, and restricted cash, end of period
$
708.8
$
747.9
$
625.9
See accompanying notes to the consolidated financial statements.
RB Global, Inc.
60
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
1. Description of Business and Basis of Preparation
Description of Business
RB Global, Inc. and its subsidiaries (collectively referred to as the “Company”, “RB Global”, “we”, “us”, or “our”) is a leading, omnichannel marketplace that
provides value-added insights, services and transaction solutions for buyers and sellers of commercial assets and vehicles worldwide. The Company has
auction sites in 14 countries and a digital platform to serve customers in approximately 170 countries across a variety of asset classes, including automotive,
commercial transportation, construction, government surplus, lifting and material handling, energy, mining and agriculture.
The Company's marketplace brands include Ritchie Bros., the world's largest auctioneer of commercial assets and vehicles offering online bidding, and IAA, a
leading global digital marketplace connecting vehicle buyers and sellers. RB Global's portfolio of brands also includes Rouse Services, which provides a
complete end-to-end asset management, data-driven intelligence and performance benchmarking system, SmartEquip, an innovative technology platform that
supports customers' management of the equipment lifecycle and integrates parts procurement with both original equipment manufacturers and dealers, and
VeriTread, an online marketplace for heavy haul transport.
RB Global, Inc. is a company incorporated in Canada under the Business Corporations Act (Ontario), whose shares are publicly traded on the New York Stock
Exchange (“NYSE”) and the Toronto Stock Exchange (“TSX”).
Basis of Preparation
These financial statements have been prepared in accordance with United States generally accepted accounting principles (“US GAAP”) and the following
accounting policies have been consistently applied, except as otherwise noted, in the preparation of the consolidated financial statements. Unless otherwise
indicated, all amounts in the following tables are in millions except share and per share amounts.
2. Significant Accounting Policies
Basis of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly-owned and non-wholly owned subsidiaries in which the Company
has a controlling financial interest either through voting rights or means other than voting rights. They include the accounts of RB Global, Inc. and its
subsidiaries from their respective dates of formation, acquisition or control. All significant inter-company transactions and balances have been eliminated.
Where the Company’s ownership interest in a consolidated subsidiary is less than 100%, the non-controlling interests’ share of these non-wholly owned
subsidiaries is reported in the Company’s consolidated balance sheets as a separate component of equity or within temporary equity. The non-controlling
interests’ share of the net income of these non-wholly owned subsidiaries is reported in the Company’s consolidated income statements as a deduction from the
Company’s net income to arrive at net income attributable to controlling interests of the Company.
Revenue Recognition
Revenues are comprised of:
•
Service revenue, including the following:
i.
Transactional seller revenues, which includes commissions earned from consignors on the sale of consigned assets, as well as other fees earned from
consignors to facilitate the sale of an asset such as towing to our yards, liens search, title processing and online listing and inspection fees;
ii.
Transactional buyer revenues, which includes buyer transaction fees based on a tiered structure earned from the purchasers of consigned assets and
inventory, as well as other fees earned from buyers to complete the purchase of an asset, such as title processing, late pick-up, buyer platform
registration and other administrative processing charges; and
RB Global, Inc.
61
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
iii. Marketplace services revenues, which includes fees earned from various optional services provided to buyers, sellers, or other third-parties, such as
transportation, buyer towing, refurbishment, financing, parts procurement, data and appraisal, and other ancillary services.
•
Inventory sales revenue, which consists of revenue relating to assets that are purchased by the Company and then resold.
The Company recognizes revenue when control of the promised goods or services is transferred to customers, or upon completion of the performance
obligation, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. A performance obligation is a
promise in a contract to transfer a distinct good or service, or a series of distinct goods or services, to the customer. A contract’s transaction price is allocated to
each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The transaction price is reduced by
estimates of variable consideration, such as volume rebates and discounts. All estimates, which are evaluated at each reporting period, are based on the
Company’s historical experience, anticipated volumes, and judgment.
The Company earns commissions from consignments by offering several contract options:
•
Straight commission contracts, where the consignor receives the gross proceeds from the sale less a pre-negotiated commission rate;
•
Fixed fee commission contracts, where the consignor receives the gross proceeds from the sale less a fixed flat fee; and
•
Guarantee contracts, where the consignor receives a guaranteed minimum amount plus an additional amount if proceeds exceed a specified level.
The Company also offers its customers the option to enter into inventory contracts, where it purchases assets before they are resold in its auctions or
marketplaces. The Company may also sell consigned assets or purchased inventory in private sales transactions.
Service Revenue
The Company’s commissions are earned as a pre-negotiated fixed percentage rate of the gross selling price of the asset sold or as a fixed fee. Fixed fees are
earned in auction contracts from consignors relating primarily to the sale of vehicles and includes the remarketing of vehicles, including the inbound tow,
processing, storage, titling, enhancing and sale at auction. Related costs are deferred and recognized at the time of sale. Other commissions are earned typically
when the Company guarantees a certain level of proceeds to a consignor.
With the final acceptance of the winning bid, the highest bidder becomes legally obligated to pay the full purchase price, which is the winning bid of the
property purchased and the seller is legally obligated to relinquish the property in exchange for the winning bid less any seller’s commission. For auction and
marketplace sales, transactional seller and buyer revenue is recognized when a binding obligation with the buyer is created upon the final acceptance of the
winning bid, and the performance obligations, including other sale related services, are satisfied at the end of the sale process. Revenue is measured at the fair
value of the consideration received or receivable and is shown net of value-added tax and duties.
Under the standard terms and conditions of its auction and marketplace sales, except for contracts for the sale of some vehicles, the Company is not obligated
to pay a consignor for property that has not been paid for by the buyer, provided the property has not been released to the buyer. Under the standard terms and
conditions of its vehicle auction and marketplace sales, the Company in certain arrangements may have to pay a consignor for property that has not been paid
for by the buyer. If the buyer defaults on its payment obligation, also referred to as a collapsed sale, the sale is cancelled in the period in which the
determination is made, and the property is returned to the consignor or placed for sale at a later date. In some cases, if the buyer defaults on its payment
obligation but the Company has already paid the consignor for the property, then the property is considered inventory, recognized on the Company's
consolidated balance sheets, and placed for sale at a later date. The Company recognizes a provision for expected collapsed or cancelled sales, which is based
on an estimate of the service revenues relating to transactions that may not complete and where the buyer may default on its obligation. The Company
determines the provision based on historical collapse experience, customer data and reasonable and supportable forecasts of the outcome of such transactions.
RB Global, Inc.
62
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
Guarantee contracts typically include a pre-negotiated percentage of the guaranteed gross proceeds plus a percentage of proceeds in excess of the guaranteed
amount. Losses from guarantee contracts are recorded in the period in which the relevant sale is completed or accrued if they become probable and estimable.
The Company may also enter into arrangements with customers and other third parties in the disposition of consigned assets to generate revenues, where it may
share commissions or buyer transaction fees. Where commissions or buyer fees are shared with a third party there is judgment in evaluating whether the
Company is acting as the principal in the arrangement and reports revenue on a gross basis, or as the agent in the arrangement and reports revenue on a net
basis. As part of this evaluation, the Company assesses if it obtains control of the asset or service before the asset is sold and whether it is ultimately primarily
responsible for fulfillment of the sale. Where buyer fees are shared with consignors, the consideration is recorded as a reduction of revenue.
Transactional buyer revenue also includes buyer platform registration fees to access certain vehicle auction and marketplace sales for a one- or two-year term
which are recognized ratably over the contract term.
Marketplace services revenue is recognized in the period in which the service is provided or the product is delivered to the customer.
Inventory Sales Revenue
Revenue related to inventory contracts is recognized in the period in which the Company's sale process is completed and control of the asset has been
transferred to the buyer. Once a binding obligation on the part of a buyer to pay for the inventory is created through the sale process, the Company invoices the
buyer for the purchase price of the asset, taxes, and, if applicable, the buyer transaction fee or other buyer fees, and collects payment from the buyer.
Costs of Services
Costs of services incurred in earning revenue are comprised of expenses incurred in direct relation to conducting auctions and earning marketplace services
fees.
For our auction sites that conduct weekly auctions in the automotive sector, cost of services includes both full-time and part-time labor, lease expense, towing,
onsite customer care support and other operating costs. For our other auction sites that conduct auctions generally once or twice a quarter, mainly in the
commercial, construction and transportation sector, cost of services includes direct part-time and temporary labor costs, marketing, travel and other operating
costs to support the auction events. In addition, cost of services includes inspection costs, mainly labor and travel costs, to primarily support auctions, and
includes fees paid to third parties who may introduce the Company to the seller of the assets sold in the Company's auctions or marketplaces. Cost of services
also includes lease expense, full-time and part-time labor and other operating costs to support our GovPlanet weekly auctions.
Costs of services incurred in earning marketplace services fees includes direct labor, ancillary and logistical service expenses, including transportation costs,
and other operating costs such as marketing, travel and technology directly related to the services provided. Costs of services excludes depreciation and
amortization expenses.
Share-based Payments
The Company uses the fair value method of accounting for share-based payment awards, including stock options, performance based restricted share unit
("PSU"), time-based restricted share unit ("RSU"), and employee share purchase plan (“ESPP”) awards to measure the cost of employee services received in
exchange for the stock-based awards. The Company classifies a share-based payment award as an equity or liability payment based on the substantive terms of
the award and related arrangements.
PSU and RSU awards granted to senior executives and employees of the Company are measured at fair value on the grant date based on the Company's closing
common share price on the date of grant, and its fair value is recognized to shared-based compensation expense over the vesting period with a corresponding
increase to APIC recorded in equity. RSUs vest based on the passage of time and include restrictions related to employment. Share-based compensation
expense relating to RSUs is recognized using the graded vesting method. The number of PSUs that vest is conditional upon specified market, service, and/or
performance vesting conditions being met. The Company has the option to settle PSUs and RSUs in cash or shares. With respect to settling in shares, the
Company has the option to either (i) arrange for the purchase shares on the open market on the employee’s behalf based on the cash value that otherwise would
be delivered, or (ii) to issue a number of shares equal to the number of units that vest. The Company expects to settle PSUs and RSUs in shares and accordingly
classifies these awards as equity.
RB Global, Inc.
63
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
If the PSU includes a market condition, the Company assesses the probability of satisfying the market condition in its estimate of fair value based on a Monte
Carlo valuation model. PSUs with market conditions vest based on the passage of time and achievement of performance criteria or market conditions. Share-
based payments expense for PSUs with market conditions is recognized regardless of whether the market conditions are satisfied subject to continuing service
over the requisite service period.
At the end of each reporting period, the Company revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the
original estimates, if any, is recognized in earnings, such that the consolidated expense reflects the revised estimate, with a corresponding adjustment to equity.
Dividend equivalents on the equity-classified PSUs and RSUs are recognized as a reduction to retained earnings over the service period.
The cost of stock options is measured at fair value on the date of grant using the Black-Scholes model. The fair value of stock options expected to vest is
expensed over the respective service period of the individual awards with the corresponding increase to APIC recorded in equity. Upon exercise, any
consideration paid on exercise of the stock options and amounts fully amortized in APIC are credited to the common shares.
Deferred share units ("DSU") granted to members of the Board of Directors of the Company vest immediately upon grant and are not subject to market vesting
conditions. The Company expects to settle DSUs in cash, where the settlement amount is determined following cessation of service to the Board of Directors,
and accordingly the DSU awards are classified as liability awards. These awards are measured at fair value at the date of grant and expensed to share-based
payments expense with recognition of a corresponding liability. These awards are subsequently re-measured at fair value each reporting date up to and
including the settlement date based on the closing price of the Company's common shares and changes in fair value are recognized in share-based payments
expense.
The impact of forfeitures and fair value revisions to the share-based payment awards, if any, are recognized in earnings such that the cumulative expense
reflects the revisions, with a corresponding adjustment to the settlement liability. Liability-classified share unit liabilities are presented in trade and other
liabilities.
The Company also recognizes share-based payments expense for its ESPP based on the grant date fair value, which is recognized to earnings using the
accelerated method over the requisite service period.
Leases
The Company determines if an arrangement is a lease at inception. The Company may have lease agreements with lease and non-lease components, which are
generally accounted for separately. The Company applies a portfolio approach to account for leases of certain similar assets with similar terms. Right-of-Use
("ROU") assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising
from the lease.
The Company considers leases with an initial term of 12 months or less as short-term in nature and does not record such leases on the consolidated balance
sheets. For all other leases, ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over
the lease term, initial direct costs incurred, and prepaid lease payments and exclude lease incentives. The Company includes lease payments for renewal
options, purchase options (finance leases), or termination options in its determination of lease term, ROU asset, and lease liability when it is reasonably certain
that the Company will exercise such options. As most of the Company's leases do not provide an implicit rate, management uses the Company’s incremental
borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. Management uses the
implicit rate when readily determinable.
Operating lease expense is recognized on a straight-line basis over the lease term and is included in costs of services and selling, general and administrative
expenses. Finance lease ROU assets are generally amortized over the lease term and are included in depreciation expense. The interest on finance lease
liabilities is included in interest expense.
Sale and Leaseback Transactions
If the transfer of an asset pursuant to a sale and leaseback transaction qualifies as a sale, the Company derecognizes the underlying asset and recognizes a gain
or loss. The Company recognizes a lease obligation arising from the leaseback and the corresponding ROU asset. If the fair value of the consideration for the
sale of an asset does not equal the fair value of the asset, or if the payments for the lease are not at market rates, the Company will make adjustments to
measure the sale proceeds at fair value. Any below-market terms
RB Global, Inc.
64
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
are accounted for as a prepayment of lease payments and any above-market terms are accounted for as additional financing provided by the buyer-lessor.
If the transfer of an asset pursuant to a sale and leaseback transaction does not qualify as a sale and control has not transferred, the asset is not derecognized and
no gain or loss is recorded as the transaction is accounted for as a financing transaction.
Derivative Financial Instruments
Derivative instruments are recorded on the consolidated balance sheets at fair value. Unrealized gains and losses on derivatives not designated in a hedging
relationship are recorded as part of operating income or within change in fair value of derivatives, net in the consolidated income statements depending on the
nature of the derivative. Fair values of derivative instruments are determined using inputs based on market conditions existing at the balance sheet date, as well
as the settlement date of the derivative, if applicable. Derivatives embedded in non-derivative contracts are recognized separately unless they are closely related
to the host contract.
Fair Value Measurement
Fair value is the exit price that would be received to sell an asset or the price paid to transfer a liability in an orderly transaction between market participants at
the measurement date.
All assets and liabilities for which fair value is measured or disclosed in the consolidated financial statements at fair value are categorized within the fair value
hierarchy, based on the lowest level input that is significant to the fair value measurement or disclosure:
•
Level 1: Inputs that are based upon quoted active markets for identical assets or liabilities.
•
Level 2: Inputs, other than quoted prices included within Level 1, which are observable either directly or indirectly.
•
Level 3: Unobservable inputs where there is little or no market activity for the asset or liability. These inputs reflect management's best estimate of
what market participants would use to price the assets or liabilities at the measurement date.
For assets and liabilities that are recognized in the consolidated financial statements at fair value on a recurring basis, the Company determines whether
transfers have occurred between levels in the hierarchy by re-assessing categorization at the end of each reporting period.
Foreign Currency Translation
The parent entity’s presentation and functional currency is the United States dollar. The functional currency for each of the parent entity’s subsidiaries is the
currency of the primary economic environment in which the entity operates, which is usually the currency of the country of residency.
Accordingly, the financial statements of the Company’s subsidiaries that are not denominated in United States dollars have been translated into United States
dollars using the exchange rate at the end of each reporting period for asset and liability amounts and the monthly average exchange rate for amounts included
in the determination of earnings. Any gains or losses from the translation of asset and liability amounts are included in foreign currency translation adjustment
in other comprehensive income (loss), net of income tax.
In preparing the financial statements of the individual subsidiaries, transactions in currencies other than the entity’s functional currency are recognized at the
rates of exchange prevailing at the dates of the transaction. At the end of each reporting period, monetary assets and liabilities denominated in foreign
currencies are remeasured at the rates prevailing at that date. Foreign currency differences arising on remeasurement of monetary items are recognized in
earnings, except for gains or losses arising from intra-entity foreign currency transactions that are of a long-term investment nature, which are included in
foreign currency translation adjustments in other comprehensive income (loss), net of income tax.
Cash and Cash Equivalents and Restricted Cash
Cash and cash equivalents is comprised of cash on hand, deposits with financial institutions, and other short-term, highly liquid investments with original
maturity of three months or less and overdraft balances to the extent the financial institution has the legal right of offset. Cash and cash equivalents are readily
convertible to known amounts of cash.
RB Global, Inc.
65
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
In certain jurisdictions, local laws require the Company to hold cash in segregated bank accounts, which are used to settle auction proceeds payable resulting
from live onsite auctions and online marketplace sales conducted in those regions. In addition, the Company also holds cash generated from its online
marketplace sales in separate escrow accounts, for settlement of the respective online marketplace transactions as a part of its secured escrow service. Cash
balances relating to these arrangements are reported as restricted cash. Restricted cash balances also include funds held in accounts owned by the Company in
support of short-term stand-by letters of credit to provide seller security. Non-current restricted cash consists of funds that are restricted as to withdrawal or use
for other than current operations and are designated for expenditure in the acquisition of non-current assets and in business combinations.
Book overdrafts represent outstanding checks and other pending disbursements which are in excess of cash account balances with a right of offset. Such
amounts are recorded in accounts payable and are reflected as an operating activity in the consolidated statements of cash flows.
Trade and Other Receivables
Trade accounts receivable primarily includes amounts due from customers as a result of the sale of assets at auctions and online
marketplaces, fees to be collected from buyers, and amounts due for services provided by the Company such as parts procurement, data, transportation and
logistics and financing. Trade and other receivables also includes amounts to be collected from landlords of certain leased facilities for reimbursement of
leasehold improvements, as well as advance charges that the Company paid on a seller's behalf in the sale of vehicles. In addition, trade and other receivables
includes the current portion of loans receivable.
Accounts receivable are reported net of an allowance for credit losses. The allowance for credit losses is the Company's best estimate of the amount of probable
credit losses in existing receivables, and is based on historical write-off experience, customer economic data and reasonable and supportable forecasts of future
economic conditions. The Company regularly reviews the allowance for credit losses and past due balances for collectability. Account balances are charged
against the allowance when the Company believes that the receivable will not be recovered.
Advances Against Auction Contracts
Advances against auction contracts arise when the Company pays owners, in advance, a portion of the expected gross auction proceeds from the sale of the
related assets at future auctions. The Company’s policy is to limit the amount of advances to a percentage of the estimated gross auction proceeds from the sale
of the related assets, and before advancing funds, require proof of owner’s title to and equity in the assets, as well as receive delivery of the assets.
Advances against auction contracts are generally secured by the assets to which they relate, as the Company requires owners to provide promissory notes and
security instruments registering the Company as a charge against the asset. Advances against auction contracts are usually settled within two weeks of the date
of sale, as they are netted against the associated auction proceeds payable to the owner.
Concentration of Credit Risk
The Company maintains cash, cash equivalents and restricted cash with high quality financial institutions and diversifies its deposits across several banks.
Foreign exchange forward contracts are only executed with reputable lenders under our credit facility. Financial instruments that potentially subject the
Company to credit risk consist primarily of advanced charges receivable, trade accounts receivable and loans receivable. Advanced charges receivable are
deducted from the sales proceeds upon settlement after an auction event or disposition of the assets. The majority of trade accounts receivable are collateralized
with assets held in the Company's possession. In addition, buyers do not take possession of assets until the balance due for those assets is paid in full. The risk
associated with trade accounts receivable concentration is also limited due to the large number of accounts and their geographic dispersion. In some cases, trade
accounts receivables relating to other services are deducted from the sales proceeds upon settlement, if applicable. Trade and other receivables may also include
amounts to be collected from landlords for certain leased facilities for reimbursement of leasehold improvements, and these advances are secured by the
underlying real estate related to the lease or the Company has the option to purchase the property if costs are not reimbursed timely by the landlord. The
Company participates in certain lending arrangements that are fully collateralized and secured by certain equipment whose fair value exceeds the loan amount
at inception, and in some arrangements, also secured by other assets.
Prepaid Consigned Vehicle Charges
RB Global, Inc.
66
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
Prepaid consigned vehicle charges include the inbound tow, titling, and enhancement charges associated with a consigned vehicle on a specific identification
basis. These prepaid charges are recorded in cost of services at the date the vehicle is sold and revenue is recognized.
Inventory
Inventory consists of commercial assets and vehicles purchased for resale. Inventory is valued at the lower of cost and net realizable value, where net realizable
value represents the expected sale price upon disposition of the asset inclusive of buyer fees and other fees, less make-ready costs and costs of disposal and
transportation. The significant elements of cost include the acquisition price, in-bound transportation costs, and make-ready costs to prepare the inventory for
sale that are not selling expenses. Write-downs to the carrying value of inventory are recorded in cost of inventory sold on the consolidated income statements.
Cost of inventory sold is determined using a specific identification basis.
Property, Plant and Equipment
Property, plant and equipment are stated at cost less accumulated depreciation. Cost includes all expenditures that are directly attributable to the acquisition or
development of the asset.
The cost of self-constructed assets includes the cost of materials and direct labor, any other costs directly attributable to bringing the assets to working
condition for their intended use, the costs of dismantling and removing items and restoring the site on which they are located (if applicable), and capitalized
interest on qualifying assets. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably.
All repairs and maintenance costs are charged to earnings during the period in which they are incurred. Gains and losses on disposal of an item of property,
plant and equipment are determined based on the difference between the proceeds received from disposal of an item and its carrying amount and are recognized
in operating income on the income statements.
The basis for depreciation of the cost of an item and their estimated useful lives based on their usage is as follows:
Asset
Basis
Rate / term
Land improvements and site improvements
Declining balance
10 %
Buildings and building improvements
Straight-line
15 - 30 years
Yard, automotive and office equipment
Declining balance
20 - 30%
Computer software and equipment
Straight-line
3 - 5 years
Leasehold improvements
Straight-line
Lesser of lease term or
economic life
No depreciation is provided on freehold land or on assets in the course of construction or development. Depreciation of property, plant and equipment under
finance leases is recorded in depreciation expense.
Long-lived Assets Held for Sale
Long-lived assets, or disposal groups comprising assets and liabilities, that are expected to be recovered primarily through sale rather than through continuing
use are classified as assets held for sale. Immediately before classification as held for sale, the assets, or components of a disposal group, are measured at
carrying amount in accordance with the Company’s accounting policies. Thereafter, the assets, or disposal group, are measured at the lower of their carrying
amount and fair value less cost to sell and are not depreciated.
Intangible Assets
Intangible assets are measured at cost less accumulated amortization and accumulated impairment losses. Cost includes all expenditures that are directly
attributable to the acquisition or development of the asset, net of any amounts received in relation to those assets. Costs of internally developed software and
technology assets are amortized on a straight-line basis over their remaining estimated useful lives. Costs incurred prior to establishing technological feasibility
or prior to the beginning of the application development stage of the asset are charged to operations as such costs are incurred. Once technological feasibility is
established or the
RB Global, Inc.
67
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
application development stage has begun, directly attributable costs are capitalized until the software and technology assets are available for use.
Amortization is recognized in earnings on a straight-line basis over the estimated useful lives of intangible assets from the date that they are available for use.
The amortization periods of finite-lived intangible assets are re-evaluated periodically when facts and circumstances indicate that the remaining useful lives
may have changed. Indefinite-lived trade names and trademarks are not amortized. The estimated useful lives of the Company's intangible assets are as follows:
Asset
Rate / term
Trade names and trademarks
2 - 15 years or indefinite-lived
Customer relationships
6 - 20 years
Software and technology assets
3 - 7 years
Customer relationships includes relationships with buyers and sellers.
Cloud Computing Arrangements
The Company capitalizes costs incurred to implement cloud computing arrangements that are service contracts hosted by third-party vendors within prepaid
assets, presented in other current assets and other non-current assets on the consolidated balance sheets. Once the implementation of the cloud computing
arrangement is complete and ready for its intended use, the implementation costs are amortized to selling, general and administrative expense over the expected
term of the associated hosting arrangement on a straight-line basis, taking into account any renewal options which are reasonably certain to be exercised.
Impairment of Long-lived and Indefinite-lived Assets
Long-lived assets, comprised of property, plant and equipment, ROU assets, and intangible assets subject to amortization, are assessed for impairment
whenever events or circumstances indicate that their carrying value may not be recoverable. For the purpose of impairment testing, long-lived assets are
grouped and tested for recoverability at the lowest level that generates independent cash flows. An impairment loss is recognized when the carrying value of
the assets or asset groups is greater than the future projected undiscounted cash flows. The impairment loss is calculated as the excess of the carrying value
over the fair value of the asset or asset group. Fair value is based on valuation techniques or third party appraisals. Significant estimates and judgments are
applied in determining these cash flows and fair values.
Indefinite-lived intangible assets are tested annually for impairment as of December 31, and more frequently if indicators of potential impairment exist. The
Company has the option of performing a qualitative assessment to first determine whether the quantitative impairment test is necessary. This involves an
assessment of qualitative factors to determine the existence of events or circumstances that would indicate whether it is more likely than not that the fair value
of the indefinite-lived intangible asset is less than its carrying value. If the qualitative assessment indicates it is not more likely than not that the fair value is
less than its carrying value, a quantitative impairment test is not required. Where a quantitative impairment test is required, the procedure is to compare the
indefinite-lived intangible asset’s fair value with its carrying amount. An impairment loss is recognized as the difference between the indefinite-lived intangible
asset’s carrying amount and its fair value.
Goodwill
Goodwill represents the excess of the purchase price of an acquired business over the fair value assigned to the assets acquired and liabilities assumed in a
business combination.
Goodwill is not amortized, but it is tested annually for impairment at the reporting unit level as of December 31, and more frequently if indicators of potential
impairment are identified. The Company performs a qualitative impairment assessment if it determines that it is more likely than not that the fair value of a
reporting unit to which goodwill belongs is less than its carrying amount.
If a quantitative impairment test is required, the reporting unit’s fair value is compared to its carrying amount, including goodwill and if the reporting unit's
carrying amount exceeds its fair value, an impairment loss is recognized. In quantitative analyses, the determination of fair value requires estimates and
assumptions. The Company bases these estimates on historical and anticipated
RB Global, Inc.
68
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
results, industry trends, economic analysis, and various other assumptions, including assumptions as to the occurrence of future events.
Deferred Financing Costs
Deferred financing costs represent the unamortized debt issuance costs incurred on the issuance of the Company’s long-term debt and are amortized to interest
expense using the effective interest method over the lives of the related long term debt. Deferred financing costs are presented as a reduction in the carrying
amount of the related long term debt or are deferred on the balance sheets in other non-current assets as a deferred charge until drawn, associated with the
benefit of being able to access capital over the contractual term of the long term-debt. Deferred financing costs presented in other non-current assets relate to
the Company's revolving credit facilities. The Company expenses the portion of deferred financing costs associated with partial repayments of debt to interest
expense.
Income Taxes
The current tax expense is based on taxable profit for the period and includes any adjustments to tax payable in respect of previous years. Taxable profit differs
from income before income taxes as reported in the consolidated income statements because it excludes (i) items of income or expense that are taxable or
deductible in other years and (ii) items that are never taxable or deductible. The Company’s liability for current tax is calculated using tax rates that have been
enacted by the balance sheet date.
Income taxes are accounted for using the asset and liability method in accordance with ASC 740, Income Taxes. Deferred income tax assets and liabilities are
based on temporary differences, which are differences between the accounting basis and the tax basis of the assets and liabilities, and non-capital loss, capital
loss, and tax credits carryforwards are measured using the enacted tax rates and laws expected to apply when these differences reverse. Deferred tax benefits,
including non-capital loss, capital loss, and tax credits carryforwards, are recognized to the extent that realization of such benefits is considered more likely
than not. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period that enactment occurs. When realization
of deferred income tax assets does not meet the more-likely-than-not criterion for recognition, a valuation allowance is recognized.
Interest and penalties related to income taxes, including unrecognized tax benefits, are recorded in income tax expense in the consolidated income statements.
Liabilities for uncertain tax positions are recognized in accordance with ASC 740, Income Taxes. The Company evaluates the tax position for recognition by
determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained based on the technical merits,
including resolution of related appeals or litigation processes, if any. Recognized income tax positions are measured at the largest amount that is more than
50% likely of being realized. The Company continually assesses the likelihood and amount of potential adjustments and adjusts the income tax provision,
income taxes payable, and deferred taxes in the period in which the facts that give rise to a revision become known.
Redeemable Non-controlling Interest
Redeemable non-controlling interest is classified as temporary equity on the consolidated balance sheet, as the holder may demand
cash and put the non-controlling interest to the Company. Redeemable non-controlling interest is initially carried at its acquisition date
fair value. If it becomes probable that the redeemable non-controlling interest will be redeemed, the Company then will recognize any
change in its estimated redemption value immediately to retained earnings and adjust the carrying amount to equal the estimated
redemption value at the end of each reporting period.
Redeemable Convertible Preferred Stock
Redeemable convertible preferred stock is classified as temporary equity on the consolidated balance sheet because it could become
redeemable due to a change in control, which would be outside of the Company’s control and requires a cash payment upon
redemption. The redeemable convertible preferred stock is initially carried at fair value, and if redemption becomes probable, the
Company will recognize any change in its estimated redemption value immediately to retained earnings and adjust the carrying
amount to equal the estimated redemption value at the end of each reporting period. Direct and incremental costs incurred in
connection with the issuance of redeemable convertible stock are recorded against the proceeds received and included in its initial
carrying amount.
RB Global, Inc.
69
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
Earnings Per Share
Basic earnings per share (“EPS”) is calculated based on the two-class method, given that the Company’s Series A Senior Preferred Shares are considered a
participating security as it contractually entitles its holders to participate in the Company’s earnings. The two-class method is an earnings allocation method for
computing earnings or losses per share when a Company’s capital structure includes common stock and participating securities. The two-class method
determines earnings per share between holders of common stock and the Company’s participating preferred stock based on dividends declared and their
respective participation rights in undistributed earnings.
Net income available to common stockholders is computed as: net income attributable to controlling interests less cumulative dividends on Series A Senior
Preferred Shares and allocated earnings to Series A Senior Preferred Shares. Basic EPS is calculated by dividing net income available to common stockholders
by the weighted average common stock outstanding. Diluted EPS is calculated similarly, except that it is computed based upon the lower of the two-class
method or the if-converted method, which includes the effects of the assumed conversion of the Series A Senior Preferred Shares, and the effect of shares
issuable under the Company’s stock-based incentive plans if such effect is dilutive.
Diluted EPS includes the effects of the assumed conversion of potentially dilutive securities, which includes unvested PSUs, unvested RSUs, outstanding stock
options and stock committed under the ESPP. The dilutive effect of potentially dilutive securities is reflected in diluted EPS by application of the treasury stock
method. Under the treasury stock method, an increase in the fair market value of the Company’s common stock can result in a greater dilutive effect from
potentially dilutive securities.
Defined Contribution Plans
Certain employees of the Company are members of retirement benefit plans to which the Company matches up to a specified percentage of employee
contributions or, in certain jurisdictions, contributes a specified percentage of payroll costs as mandated by the local authorities. The only obligation of the
Company with respect to the retirement benefit plans is to make the specified contributions. Contributions to the defined contribution plans are charged to the
consolidated income statements reflecting the period of the employee's service.
Advertising Costs
Advertising costs are expensed as incurred and included in costs of services and selling, general and administrative expenses on the consolidated income
statements. Advertising expense, directly related to auction events, recorded in costs of services was $10.6 million, $9.4 million, and $9.9 million for 2024,
2023, and 2022, respectively. Advertising expense recorded in selling, general and administrative expenses was $24.6 million, $26.1 million, and $16.7 million
for 2024, 2023, and 2022, respectively.
Self-insurance Reserves
The Company self-insures a portion of employee medical benefits, as well as a portion of its automobile, general liability and workers’
compensation claims. The Company has insurance coverage that limits the exposure on individual claims. The cost of the insurance is
expensed over the contract periods. Utilizing historical claims experience, the Company records an accrual for the claims related to its
employee medical benefits, automobile, general liability and workers’ compensation claims based upon the expected amount of all
such claims, which includes the cost of claims that have been incurred but not reported.
Business Combinations
Business combinations are accounted for using the acquisition method. The purchase price is determined based on the fair value of the assets transferred,
liabilities assumed, and equity interests issued, after considering any transactions that are separate from the business combination and which are accounted for
separately. The Company allocates the aggregate of the fair value of the purchase consideration transferred to the tangible and intangible assets acquired and
the liabilities assumed at their estimated fair values on the date of acquisition with any excess recorded as goodwill. The purchase price allocation may be
provisional during a measurement period of up to one year to provide reasonable time to obtain the information necessary to identify and measure the assets
acquired and liabilities assumed. Any such measurement period adjustments are recognized to the assets and liabilities assumed, with the corresponding offset
to goodwill, in the period in which the adjustment amounts are determined. Acquisition-related costs are expensed as incurred as a component of acquisition-
related and integration costs.
RB Global, Inc.
70
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
2. Significant Accounting Policies (continued)
Where the acquired assets and liabilities do not meet the definition of a business, or substantially all of the fair value of the gross assets acquired are
concentrated in a single identifiable asset or group of similar identifiable assets, the acquisition is considered an asset acquisition, and is accounted for using the
cost accumulation model where the cost of the acquisition, including certain transaction costs, are allocated to the assets acquired on the basis of relative fair
values.
Recently Adopted Accounting Pronouncements
In November 2023, the FASB issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment
Disclosures which requires enhanced disclosure regarding reportable segments. The Company adopted the ASU during the fiscal year ended December 31,
2024 and the required disclosures are included in Note 5.
Recently Issued Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which will require enhanced annual
disclosures regarding rate reconciliations and expanded disclosures of income taxes paid information. The amendments are effective for the Company for the
fiscal year ended December 31, 2025.
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income (Subtopic 220-40): Disaggregation of Income
Statement Expenses, which will require disclosure and additional information of specific expense categories in the notes to the financial statements, The
amendments are effective for the Company for the fiscal year ended December 31, 2027 and interim periods in the fiscal year ended December 31, 2028.
The Company is in the process of evaluating the impact that the above pronouncements may have on its consolidated financial statements and related
disclosures.
3. Significant Judgments, Estimates and Assumptions
The preparation of financial statements in conformity with US GAAP requires management to make judgments, estimates and assumptions that affect the
reported amounts of assets and liabilities and the disclosures of contingent liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ from those estimates.
The accounting for the Company's position in regards to the Notice of Assessment and Statement of Interest (“NOA”) received from the Canada Revenue
Agency ("CRA"), described in Note 8, required significant judgment and an assessment over whether it is more likely than not that the Company's tax position
will be sustained. The matter required management to evaluate the tax technical merits and assess the likelihood of its resolution at appeals or through
litigation.
4. Acquisitions
(a) Boom and Bucket Acquisition
On October 31, 2024, the Company completed its acquisition of Boom and Bucket Inc. ("Boom and Bucket") for a total purchase price of approximately
$10 million. Boom and Bucket is a digital dealer that connects buyers and sellers in the sale of used heavy equipment through its online fixed price marketplace
platform. The acquisition was accounted for as an asset acquisition as substantially all of the fair value of the gross assets acquired is concentrated in a single
identifiable asset, the developed technology platform. The purchase price consisted primarily of cash proceeds paid to the former shareholders and
reimbursement of transaction costs. The acquired developed technology platform will be amortized from its acquisition date over its estimated useful life of
three years.
(b) IAA Acquisition
On March 20, 2023, the Company completed its acquisition of IAA, Inc. ("IAA") for a total purchase price of approximately $6.6 billion. The Company
acquired IAA to create a leading omnichannel marketplace for vehicle buyers and sellers. IAA stockholders received $12.80 per share in cash and 0.5252
shares of the Company for each share of IAA common stock they owned (the “Exchange Ratio”). As such, the Company paid $1.7 billion in cash consideration
and issued 70.3 million shares of its common stock. In addition, the Company repaid $1.2 billion of IAA’s net debt, which included all outstanding borrowings
and unpaid fees under IAA’s credit agreement and $500.0 million principal amount of IAA senior notes, at a redemption price equal to 102.75% of the principal
amount
RB Global, Inc.
71
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
4. Acquisitions (continued)
plus accrued and unpaid interest. IAA’s outstanding equity awards were also cancelled and exchanged into equivalent outstanding equity awards relating to the
Company’s common stock, based on the equity award exchange ratio of 0.763139.
The acquisition was accounted for in accordance with ASC 805, Business Combinations. The following table summarizes the final allocation of the purchase
price to the fair value of assets acquired and liabilities assumed:
Purchase price (cash: $1,714.2 million; fair value of common shares issued: $3,712.9 million; repayment of net debt: $1,157.1 million;
reimbursement of costs: $48.8 million; and fair value of exchanged equity awards: $13.1 million)
$
6,646.1
Assets acquired:
Cash and cash equivalents
166.6
Trade and other receivables
497.3
Inventory
57.1
Other current assets
28.0
Income taxes receivable
0.6
Property, plant and equipment
618.5
Operating lease right-of-use assets
1,289.7
Other non-current assets
34.8
Intangible assets
2,712.1
Liabilities assumed:
Auction proceeds payable
60.7
Trade and other liabilities
257.0
Current operating lease liability
77.5
Income taxes payable
3.5
Long-term operating lease liability
1,192.7
Other non-current liabilities
24.3
Deferred tax liabilities
689.5
Fair value of identifiable net assets acquired
3,099.5
Goodwill acquired on acquisition
$
3,546.6
The following table summarizes the final fair values of the identifiable intangible assets acquired:
Asset
Preliminary fair value
at acquisition
Weighted average
amortization period
Customer relationships
$
2,293.5
15 years
Developed technology
245.2
4 years
Trade names and trademarks
166.6
5 years
Software under development
6.8
—
$
2,712.1
13.4 years
Goodwill relates to synergies expected to be achieved from the operations of the combined company, the assembled workforce of IAA, and intangible assets
that do not qualify for separate recognition. Expected synergies include both increased revenue opportunities and the cost savings from the planned integration
of platform infrastructure, facilities, personnel, and systems. The transaction is considered a non-taxable business combination and the goodwill is not
deductible for tax purposes.
(c) VeriTread Acquisition
On January 3, 2023, the Company acquired 8,889,766 units of VeriTread LLC ("VeriTread"), for $25.1 million cash consideration from its existing unitholders
and acquired another 1,056,338 units through an investment of $3.0 million cash. As a result, the
RB Global, Inc.
72
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
4. Acquisitions (continued)
Company increased its investment in VeriTread to 75% and obtained control of VeriTread pursuant to an amended operating agreement on January 18, 2023.
Immediately prior to the acquisition, the Company owned 11% of VeriTread, with an acquisition date fair value of $4.3 million based on the per unit purchase
price, and therefore, upon remeasurement of its previously held interest, the Company recorded a gain of $1.4 million in other income, net at acquisition.
VeriTread is a transportation technology company that provides an online marketplace solution for open deck transport, connecting shippers and service
providers.
Concurrently, the Company entered into a put/call agreement with one of the minority unitholders of VeriTread for its remaining units, another 21% ownership
interest. Pursuant to this agreement, the minority unitholder has rights, in certain circumstances, to put or sell its remaining units of VeriTread to the Company,
subject to VeriTread achieving certain performance targets at a predetermined value or fair value, depending on the timing and targets achieved. The Company
also has the right to call or purchase the remaining units of the minority unitholder upon achievement of certain integration milestones at fair value. The
redeemable non-controlling interest is classified in temporary equity on the consolidated balance sheets. On the acquisition date the Company determined that
redemption of the redeemable non-controlling interest was probable. An additional non-controlling interest of 4% held in VeriTread is classified within equity
as that interest does not contain put/call options.
The acquisition was accounted for in accordance with ASC 805, Business Combinations. The following table summarizes the final allocation of the purchase
price to the fair value of assets acquired and liabilities assumed:
Purchase price (cash: $28.1 million; and fair value of previously held equity interest: $4.3 million)
$
32.4
Fair value of identifiable net assets acquired
17.9
Redeemable non-controlling interest
(8.9)
Non-controlling interest
(1.8)
Goodwill acquired on acquisition
$
25.2
The final fair value of identifiable net assets acquired consists of cash and cash equivalents of $3.4 million, trade and other receivables and other current assets
of $0.9 million, trade and other liabilities of $1.1 million, and identifiable intangible assets of $14.7 million as summarized in the following table:
Asset
Fair value
at acquisition
Weighted average
amortization period
Customer relationships
$
7.2
5 years
Software and technology assets
7.1
7 years
Trade names and trademarks
0.4
2 years
$
14.7
5.9 years
Goodwill relates to benefits expected from the acquisition of VeriTread’s business, its assembled workforce and associated technical expertise, as well as
anticipated synergies from applying VeriTread’s transportation platform, network of transport carriers, equipment database and services to the Company’s
customer base. This acquisition is expected to accelerate the Company’s marketplace strategy, which brings services, insights, and transaction solutions
together to improve the overall customer experience. The transaction is considered a non-taxable business combination and the goodwill is not deductible for
tax purposes.
5. Segment Information
The Company has one operating and reportable segment which reflects the manner in which the Company’s Chief Operating Decision Maker (“CODM”), its
Chief Executive Officer, reviews and assesses the performance of the business and allocates resources.
The information used by the CODM to assess performance and allocate resources includes various measures of segment profit, however, for the purposes of the
disclosures required by ASC 280, Segment Reporting and ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,
the Company has determined that the measure most consistent with the measurement principles used in measuring the corresponding amounts in the
consolidated financial statements is net income. Consolidated financial information is used to monitor forecast versus actual results in order to make key
operating decisions. The
RB Global, Inc.
73
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
5. Segment Information (continued)
CODM does not evaluate the performance of the Company or allocate resources at any level below the consolidated level or based on the Company's assets or
liabilities.
The following discloses the significant segment expenses, in the context of deriving net income, that are regularly provided to and reviewed by the CODM
reconciled to the segment’s net income:
At December 31,
2024
2023
2022
Revenue
$
4,284.2 $
3,679.6 $
1,733.8
Significant segment expenses
Costs of services
1,415.7
1,007.6
168.1
Cost of inventory sold
863.8
893.6
608.6
Selling, general and administrative
773.9
743.7
539.9
Acquisition-related and integration costs
29.0
216.1
37.3
Depreciation and amortization
444.4
352.2
97.2
Interest expense
233.7
213.8
57.9
Income tax expense
137.3
76.4
86.2
Other segment items
(26.4)
(29.8)
(181.2)
Net income
$
412.8 $
206.0 $
319.8
Other segment items consists of gain on disposition of property, plant and equipment, change in fair value of derivatives, net, interest income, and foreign
exchange (loss) gain, as reported on the consolidated income statements.
The following tables summarize revenue and property, plant, and equipment by geographic area based on the location of the underlying auction activity or
rendering of services and location of the underlying assets:
Year ended December 31,
2024
2023
2022
Revenue
United States
$
3,094.1 $
2,591.6 $
970.9
Canada
640.6
551.5
375.7
Europe
333.0
321.8
143.2
Australia
137.2
136.7
181.3
Other
79.3
78.0
62.7
$
4,284.2 $
3,679.6 $
1,733.8
At December 31,
2024
2023
2022
Property, plant, and equipment
United States
$
947.7 $
884.9 $
241.9
Canada
176.4
155.0
87.3
Europe
113.0
117.5
86.7
Australia
18.2
20.2
20.0
Other
20.1
23.3
23.2
$
1,275.4 $
1,200.9 $
459.1
The geographic composition of operating lease right-of-use assets is similar to that of property, plant, and equipment.
RB Global, Inc.
74
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
6. Revenue
During the year ended December 31, 2024 the Company updated its presentation of disaggregated revenue to be consistent with how management currently
evaluates its financial and business performance. The prior year disaggregation of revenue amounts have been recast to conform with current period
presentation.
The following table summarizes the Company's revenue from the rendering of services and the sale of inventory:
Year ended December 31,
2024
2023
2022
Transactional seller revenue
$
939.4 $
851.7 $
514.6
Transactional buyer revenue
2,067.1
1,593.2
330.6
Marketplace services revenue
357.1
287.6
205.4
Total service revenue
3,363.6
2,732.5
1,050.6
Inventory sales revenue
920.6
947.1
683.2
$
4,284.2 $
3,679.6 $
1,733.8
During fiscal 2024 approximately 22% (2023: 19%) of consolidated revenues were associated with vehicles supplied by the Company's three (2023: three)
largest provider customers.
7. Operating Expenses
Acquisition-related and Integration Costs
Acquisition-related and integration costs consist of operating expenses incurred in connection with business combinations, such as due
diligence, advisory, legal, integration, severance, acceleration of share-based payments expense, and share-based continuing
employment costs. Integration costs primarily include expenses incurred with third-parties to support integration activities to achieve
cost synergies and integration goals relating to recent acquisitions.
The following is a summary of our acquisition-related and integration costs by significant acquisition and nature:
Year ended December 31,
2024
2023
2022
IAA acquisition
Financing
$
— $
30.0 $
—
Severance
13.8
41.1
—
Integration
11.7
34.5
—
Acceleration of share-based payments expense
1.0
6.8
—
Legal
—
12.3
7.8
Investment banking, consulting and other acquisition-related costs
1.2
68.8
13.5
Settlement of pre-existing contractual arrangement
—
16.3
—
27.7
209.8
21.3
Other acquisitions
1.3
6.3
16.0
$
29.0 $
216.1 $
37.3
Other acquisitions primarily consists of costs in connection with the acquisitions of Boom and Bucket, VeriTread, SmartEquip, and Rouse Services, as well as
costs incurred with the terminated Euro Auctions acquisition in 2022.
RB Global, Inc.
75
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
7. Operating Expenses (continued)
Depreciation and Amortization
Year ended December 31,
2024
2023
2022
Depreciation
$
103.6 $
86.2 $
31.4
Amortization
340.8
266.0
65.8
$
444.4 $
352.2 $
97.2
8. Income Taxes
The components of the provision for income taxes are as follows:
Year ended December 31,
2024
2023
2022
Canadian:
Current tax expense
$
74.3 $
43.4 $
60.9
Deferred tax expense
(5.7)
(2.7)
2.7
Foreign:
Current tax expense before application of operating loss carryforwards
132.3
100.2
29.6
Tax benefit of operating loss carryforwards
(0.1)
(1.4)
(4.0)
Total current tax expense
132.2
98.8
25.6
Deferred tax (benefit)
(63.5)
(63.1)
(3.0)
Total deferred tax (benefit)
(63.5)
(63.1)
(3.0)
$
137.3 $
76.4 $
86.2
The provision for income taxes was different from the Canadian and provincial statutory rate applied to income before taxes and is reconciled as follows:
Year ended December 31,
2024
2023
2022
Earnings before income tax
$
550.1
$
282.4
$
406.0
Statutory federal and provincial tax rate in British Columbia, Canada
27.00 %
27.00 %
27.00 %
Expected income tax expense
$
148.5
$
76.2
$
109.6
Different tax rates of subsidiaries operating in foreign jurisdictions
(10.9)
(3.7)
(6.4)
Non-deductible expenses
4.1
11.1
7.7
Executive compensation and fringe benefits
3.5
5.0
0.3
Non-taxable gain on capital items
0.1
(0.4)
(19.4)
Benefit of Foreign-Derived Intangible Income (FDII)
(3.2)
(6.9)
—
Unrecognized tax benefits
5.5
2.0
(1.5)
Equity compensation
(5.1)
(3.9)
(2.3)
Other
(5.2)
(3.0)
(1.8)
$
137.3
$
76.4
$
86.2
Permanently reinvested undistributed pre-tax earnings of the Company's foreign subsidiaries were approximately $297.6 million for the year ended
December 31, 2024 (2023: $113.1 million; 2022: $93.1 million). Earnings retained by subsidiaries as at December 31, 2024 were approximately $878.6 million
(2023: $676.7 million). If the undistributed earnings of foreign subsidiaries were to be remitted, income tax expense and withholding tax expense would need
to be recognized, net of any applicable foreign tax credits. It is not practicable for the Company to determine the additional tax that may be incurred upon
remittance of these earnings.
RB Global, Inc.
76
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
8. Income Taxes (continued)
The Company offsets all deferred tax assets and liabilities by tax filing jurisdiction, as well as any related valuation allowance, and presents them as a single
non-current deferred income tax asset or non-current deferred income tax liability. Deferred tax assets and deferred tax liabilities were as follows:
At December 31,
2024
2023
Deferred tax assets:
Working capital
$
25.1 $
33.6
Property, plant and equipment
4.9
5.2
Share-based compensation
14.4
11.9
Tax losses and tax credit carryforwards
39.1
37.9
Lease liabilities
381.8
356.2
Notes receivable/payable
8.8
2.3
Other
17.2
9.6
Total deferred tax assets
491.3
456.7
Deferred tax liabilities:
Property, plant and equipment
$
(74.7) $
(86.4)
Goodwill
(23.6)
(12.8)
Intangible assets
(586.6)
(653.5)
Right-of-use assets
(376.2)
(354.7)
Long-term debt
—
(0.9)
Notes receivable/payable
(17.7)
(5.6)
Other
(5.6)
(6.0)
Total deferred tax liabilities
(1,084.4)
(1,119.9)
Net deferred tax liabilities
$
(593.1) $
(663.2)
Valuation allowance
(6.8)
(9.1)
Net deferred tax
$
(599.9) $
(672.3)
At December 31, 2024, the Company had non-capital loss carryforwards that are available to reduce taxable income in the future years. These non-capital loss
carryforwards expire as follows:
2025
$
—
2026
—
2027
0.3
2028
—
2029 and thereafter
62.4
$
62.7
The Company has capital loss carryforwards of approximately $67.1 million (2023: $73.4 million) available to reduce future capital gains and interest
deduction carryforwards of $63.5 million (2023: $60.7 million), both of which carryforward indefinitely.
Tax losses are denominated in the currency of the countries in which the respective subsidiaries are located and operate. Fluctuations in currency exchange
rates could reduce the U.S. dollar equivalent value of these tax loss and tax credit carry forwards in future years.
RB Global, Inc.
77
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
8. Income Taxes (continued)
A reconciliation of the beginning and ending amount of unrecognized tax benefits from uncertain tax positions is as follows:
At December 31,
2024
2023
Unrecognized tax benefits, beginning of year
$
25.1 $
16.0
Increases – tax positions related to acquisitions
0.3
8.0
Increases – tax positions taken in prior period
5.1
1.2
Decreases – tax positions taken in prior period
—
(0.4)
Increases – tax positions taken in current period
3.1
4.1
Settlement and lapse of statute of limitations
(5.7)
(4.0)
Effect of foreign currency translation
(1.2)
0.2
Unrecognized tax benefits, end of year
$
26.7 $
25.1
At December 31, 2024, the Company had gross unrecognized tax benefits of $26.7 million (2023: $25.1 million). Of this total, $18.7 million (2023: $13.6
million) represents the net amount of unrecognized tax benefits that, if recognized, would favorably impact the effective tax rate.
The Company records interest expense and penalties related to unrecognized tax benefits within the Company's provision for income taxes on the consolidated
income statements. At December 31, 2024, the Company had accrued $4.4 million (2023: $4.4 million) for interest and penalties that have been included in the
above reconciliation table, and during the year ended December 31, 2024 the Company has recognized $0.1 million recovery (2023: $0.6 million) in interest
and penalties in the consolidated income statements.
The Company is routinely subject to tax audits and reviews in various jurisdictions around the world. Tax authorities may challenge the manner in which the
Company has filed its tax returns and reported its income.
On December 3, 2024, the CRA issued the Company an NOA for CA$79.1 million (Canadian dollars) (approximately $55.1 million), for the taxation years
2010 through 2015, inclusive of CA$37.7 million in income taxes (approximately $26.3 million), and CA$41.4 million in interest and penalties (approximately
$28.9 million). The CRA is asserting that one of the Company’s Luxembourg subsidiaries which was in operation from 2010 to 2020 was resident in Canada
from 2010 through 2015 and that its worldwide income should be subject to Canadian income taxation.
The Company plans to object to the notice of assessment as it believes it is and has been in full compliance with Canadian tax laws and intends to pursue all
available administrative and judicial remedies necessary to resolve this matter. As such, the Company plans to file a Notice of Objection with the CRA in
March 2025 and accordingly has paid a deposit of CA$39.5 million (approximately $27.6 million) to the CRA in early February 2025, the minimum required
by law as part of the CRA’s objection process. In the event that the Company prevails in its objection or subsequent legal proceedings, the deposit would be
refunded with interest to the Company.
In the event that the Company’s tax filing position is not upheld by either the CRA or by a court of last resort, the Company would incur and record the
amounts assessed in income tax, interest and penalties in its consolidated financial statements, which could have a material negative effect on the Company’s
results of operations.
In addition, during the third quarter of 2024, the CRA has requested information regarding the 2016 to 2020 taxation years for the same matter, which the
Company provided to the CRA in January 2025. The Company has not received a notice of assessment relating to the 2016 to 2020 taxation years. Depending
on the outcome of this matter with the CRA, the Company could incur additional income taxes, penalties and interest relating to the 2016 to 2020 taxation
years, which could have a material negative effect on its results of operations.
At December 31, 2024, the Company has not recorded any amounts relating to this matter in the consolidated financial statements because it is the Company’s
conclusion that it is more likely than not that the Company’s tax filing position will ultimately be sustained.
The Company is unable to predict the ultimate outcome of this matter and the final disposition of any appeals, or litigation, which could take numerous years to
resolve.
RB Global, Inc.
78
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
9. Earnings Per Share Available to Common Stockholders
Year ended December 31,
2024
2023
2022
Net income available to common stockholders
$
372.7 $
174.9 $
319.7
Basic weighted average shares outstanding
183,958,258
166,963,575
110,781,282
Weighted average effect of dilutive securities:
Share units
684,066
689,290
516,144
Stock options and employee share purchase plan
612,233
551,116
588,599
Diluted weighted average shares outstanding
185,254,557
168,203,981
111,886,025
Earnings per share available to common stockholders:
Basic
$
2.03 $
1.05 $
2.89
Diluted
$
2.01 $
1.04 $
2.86
10. Supplemental Cash Flow Information
Net Changes in Operating Assets and Liabilities
Year ended December 31,
2024
2023
2022
Trade and other receivables
$
14.8 $
(36.8) $
(44.1)
Prepaid consigned vehicle charges
(1.5)
(66.6)
—
Inventory
26.2
(10.7)
(7.2)
Advances against auction contracts
14.1
(12.6)
(5.7)
Prepaid expenses and deposits
1.0
1.2
2.6
Income taxes receivable
(20.5)
(6.6)
16.8
Auction proceeds payable
(113.2)
(12.1)
139.1
Trade and other liabilities
104.2
174.5
18.6
Income taxes payable
16.7
(37.2)
35.2
Operating lease obligation
(134.3)
(124.5)
(12.9)
Other
(7.3)
(12.3)
8.8
$
(99.8) $
(143.7) $
151.2
Other Supplemental Cash Flow Information
Year ended December 31,
2024
2023
2022
Interest paid, net of interest capitalized
$
228.8 $
163.4 $
38.0
Interest received
26.2
22.0
7.0
Net income taxes paid
201.0
180.0
29.6
Non-cash purchase of property, plant and equipment under finance leases
37.7
12.7
13.4
Non-cash right of use assets obtained in exchange for new lease obligations
231.7
188.7
30.3
RB Global, Inc.
79
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
11. Fair Value Measurement
The following table summarizes the fair values and carrying amounts of the Company's financial instruments that are required to be recorded or disclosed at
fair value on a recurring basis:
December 31, 2024
December 31, 2023
Category
Carrying
amount
Fair value
Carrying
amount
Fair value
Loans receivable
Level 2
$
53.6 $
53.3 $
37.7 $
37.6
Derivative financial assets
Level 2
—
—
0.4
0.4
Derivative financial liabilities
Level 2
0.2
0.2
—
—
Contingent consideration liability
Level 3
4.8
4.8
5.2
5.2
Long-term debt
Secured Notes
Level 1
544.8
563.8
543.2
565.1
Unsecured Notes
Level 1
790.9
837.5
789.5
848.0
Term loans
Level 2
1,290.5
1,297.5
1,743.1
1,758.1
The fair value of loans receivable with a maturity date greater than one year are determined by estimating discounted cash flows using
market rates. The fair value of derivative financial assets and derivative financial liabilities, which consist of forward currency contracts, are determined using
observable inputs, including foreign currency spot exchange rates and forward pricing curves, and considers the credit risk of the Company and its
counterparties. The fair value of the contingent consideration liability, which relates to IAA's acquisition of Marisat, Inc. in 2021, is determined using certain
unobservable inputs, including the likelihood of the achievement of volume targets. The fair values of the Secured Notes and Unsecured Notes are determined
by reference to a quoted market price traded in an over-the-counter broker market. The carrying values of the term loans, before deduction of deferred debt
issuance costs, approximate their fair values as the interest rates on the loans are short-term in nature.
12. Derivative Financial Instruments
The Company enters into forward currency contracts from time to time to manage exposure to foreign currency exchange rate
fluctuations recognized by its subsidiaries on certain loans receivable and significant intercompany balances. The unrealized gain
(loss) on forward currency contracts recognized within foreign exchange (loss) gain is as follows:
Year ended December 31,
2024
2023
2022
Unrealized gain (loss) on forward currency contracts
$
0.5 $
0.4 $
(4.6)
The total gross notional amount of forward currency contracts outstanding as at December 31, 2024 is $48.1 million (2023: $33.9 million).
RB Global, Inc.
80
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
13. Trade and Other Receivables
December 31,
2024
December 31,
2023
Advanced charges receivable
$
347.3 $
374.7
Trade accounts receivable
301.7
315.8
Loans receivable
35.4
21.8
Consumption taxes receivable
25.6
21.1
Other receivables
6.6
4.5
716.6
737.9
Less: allowance for credit losses
(7.2)
(6.4)
$
709.4 $
731.5
The Company generally has possession of assets or asset titles collateralizing a significant portion of trade receivables. Trade receivables are due for settlement
within seven days of the date of sale, after which they are interest bearing. Consumption taxes receivable are deemed fully recoverable unless disputed by the
relevant tax authority. Other receivables are unsecured and non-interest bearing.
The following table presents the activity in the allowance for credit losses on trade receivables and loans receivables for the period ended December 31, 2024:
December 31,
2024
December 31,
2023
Allowance for credit losses, beginning of year
$
6.4 $
3.3
Provision
5.1
5.9
Write-offs charged against the allowance
(4.3)
(2.8)
Allowance for credit losses, end of year
$
7.2 $
6.4
Loans Receivable
The Company participates in certain lending arrangements that are fully collateralized and secured by certain equipment, and in some arrangements, also
secured by other assets. These arrangements typically have terms of one to five years. In an event of default under these agreements, the Company will be
entitled to the proceeds of disposition of the collateral to recover its loans receivable balance. The allowance for credit losses is not significant.
14. Inventory
At each period end, inventory is reviewed to ensure that it is recorded at the lower of cost and net realizable value. During the year ended December 31, 2024,
the Company recorded inventory write-downs of $14.9 million (2023: $7.0 million; 2022: $4.4 million) as a component of cost of inventory sold.
15. Other Current Assets
December 31,
2024
December 31,
2023
Prepaid expenses and deposits
$
52.3 $
52.5
Inventory deposits
17.4
16.5
Advances against auction contracts
7.3
21.9
Derivative financial assets
—
0.3
$
77.0 $
91.2
RB Global, Inc.
81
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
16. Property, Plant and Equipment
At December 31, 2024
Cost
Accumulated
depreciation
Net book value
Land
$
610.9 $
— $
610.9
Buildings and improvements
499.6
(243.0)
256.6
Yard, automotive and office equipment
348.1
(157.7)
190.4
Computer software and equipment
109.2
(83.0)
26.2
Leasehold improvements
174.3
(66.4)
107.9
Assets under development
83.4
—
83.4
$
1,825.5 $
(550.1) $
1,275.4
At December 31, 2023
Cost
Accumulated
depreciation
Net book value
Land
$
549.2 $
— $
549.2
Buildings and improvements
491.1
(236.1)
255.0
Yard, automotive and office equipment
306.0
(117.5)
188.5
Computer software and equipment
108.2
(79.5)
28.7
Leasehold improvements
160.0
(37.3)
122.7
Assets under development
56.8
—
56.8
$
1,671.3 $
(470.4) $
1,200.9
During the year ended December 31, 2024, interest of $4.5 million (2023: $1.8 million; 2022: $0.1 million) was capitalized to the cost of assets under
development.
Additions during the year include $37.6 million (2023: $12.6 million; 2022: $13.2 million) of property, plant and equipment under finance leases.
On March 17, 2022, the Company completed the sale and leaseback of a parcel of land including all buildings, in Bolton, Ontario, Canada for a total sale
consideration of CA$208.2 million (approximately $165 million) net of closing and transaction costs, and recognized a gain on disposition of property, plant
and equipment of $169.1 million.
17. Other Non-current Assets
December 31,
2024
December 31,
2023
Refundable deposits
$
30.1 $
27.9
Loans receivable
18.2
15.9
Cloud computing implementation costs
17.8
9.9
Investments
11.9
12.9
Tax receivable
6.0
9.1
Deferred debt issue costs
2.8
4.0
Other
11.6
5.9
$
98.4 $
85.6
RB Global, Inc.
82
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
18. Intangible Assets
At December 31, 2024
Cost
Accumulated
amortization
Net book value
Trade names and trademarks
$
220.5 $
(63.2) $
157.3
Customer relationships
2,538.1
(393.7)
2,144.4
Software and technology assets
781.1
(416.9)
364.2
Software under development
2.8
—
2.8
$
3,542.5 $
(873.8) $
2,668.7
At December 31, 2023
Cost
Accumulated
amortization
Net book value
Trade names and trademarks
$
221.9 $
(29.7) $
192.2
Customer relationships
2,553.1
(225.0)
2,328.1
Software and technology assets
670.4
(285.5)
384.9
Software under development
8.9
—
8.9
$
3,454.3 $
(540.2) $
2,914.1
At December 31, 2024, a net carrying amount of $52.7 million (December 31, 2023: $59.0 million) included in intangible assets was not subject to
amortization, $49.9 million of which relates to certain trade names and trademarks and the remainder relates to software under development.
During the year ended December 31, 2024, interest of $1.0 million (2023: $1.6 million; 2022: $0.4 million) was capitalized to the cost of software under
development.
At December 31, 2024, estimated annual amortization expense for the next five years ended December 31 are as follows:
2025
$
340.2
2026
319.3
2027
244.9
2028
192.9
2029
178.7
$
1,276.0
19. Goodwill
Balance, December 31, 2022
$
948.8
Additions from business combinations
3,572.4
Effect of foreign currency translation
15.8
Balance, December 31, 2023
4,537.0
Effect of foreign currency translation
(25.2)
Balance, December 31, 2024
$
4,511.8
RB Global, Inc.
83
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
20. Trade and Other Liabilities
December 31, 2024
December 31, 2023
Book overdrafts
$
276.5 $
129.1
Accrued liabilities
237.3
294.5
Trade payables
139.7
138.9
Taxes payable
63.4
63.7
Current portion of finance leases and equipment financing obligations
26.0
24.4
Deferred revenue
20.6
17.5
Share unit liabilities
8.4
7.6
Other payables
10.1
10.1
$
782.0 $
685.8
Taxes payable includes value added tax, sales tax, and digital services tax.
21. Debt
Interest Rate
December 31,
2024
December 31,
2023
Short-term debt
7.07 % $
27.7 $
13.7
Long-term debt:
Term loans (maturing September 2026):
Term Loan A Facility loan denominated in Canadian dollars, secured
5.85 %
72.5
83.1
Term Loan A Facility loan denominated in US dollars, secured
6.92 %
1,225.0
1,675.0
Less: unamortized debt issuance costs
(7.0)
(15.0)
Senior secured and unsecured notes:
Senior secured notes due in March 2028
6.75 %
550.0
550.0
Less: unamortized debt issuance costs
(5.2)
(6.8)
Senior unsecured notes due in March 2031
7.75 %
800.0
800.0
Less: unamortized debt issuance costs
(9.1)
(10.5)
Total long-term debt
2,626.2
3,075.8
Less: current portion of long-term debt
4.1
14.2
Long-term debt
$
2,622.1 $
3,061.6
Interest rates on short-term debt and term loans reflect the weighted-average interest rates on borrowings as of December 31, 2024.
At December 31, 2024, the Company had unused committed revolving credit facilities aggregating $705.9 million that are available until September 2026
subject to certain covenant restrictions, and unused uncommitted revolving credit facilities aggregating $15.0 million with no maturity date. The Company was
in compliance with all financial and other covenants applicable to the credit facilities at December 31, 2024.
Term Loans
In 2016, the Company entered into a credit agreement with a syndicate of lenders (as amended and restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”). The Credit Agreement is comprised of multicurrency revolving
facilities (the “Revolving Facilities”) and the Term Loan A facility (the “TLA Facility”). The TLA Facility is comprised of a facility
1
1
RB Global, Inc.
84
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
21. Debt (continued)
denominated in U.S. dollars (the “USD TLA Facility”) and a facility denominated in Canadian dollars (the “CAD TLA Facility”). TLA Facility borrowings
bear interest at a benchmark rate plus an applicable margin. The Credit Agreement matures on September 21, 2026.
On March 20, 2023, with the closing of the acquisition of IAA, the USD TLA Facility was funded for $1.8 billion and the existing
delayed-draw term facility of CAD $115.9 million was refinanced and converted to the CAD TLA Facility. The TLA Facility loans
are subject to quarterly installments of 1.25% of principal, with the balance payable at maturity. During the year ended
December 31, 2024, the Company repaid $450.0 million of principal on the USD TLA Facility (2023: $150.0 million). As of December 31, 2024, there are no
mandatory principal repayments remaining on the USD TLA Facility until maturity of the debt.
Senior Secured and Unsecured Notes
On March 15, 2023, the Company completed the offering of (i) $550.0 million aggregate principal amount of 6.75% senior secured notes due March 15, 2028
(the “Secured Notes”) and (ii) $800.0 million aggregate principal amount of 7.75% senior unsecured notes due March 15, 2031 (the “Unsecured Notes”, and
together with the Secured Notes, the “Notes”). The gross proceeds of the Notes were used, along with the TLA Facility, to fund the acquisition of IAA. Interest
on the Notes is payable in cash semi-annually in
arrears on March 15 and September 15 of each year, and began on September 15, 2023. The Secured Notes are jointly and severally
guaranteed on a senior secured basis and the Unsecured Notes are jointly and severally guaranteed on a senior unsecured basis by
certain of the Company’s subsidiaries.
At December 31, 2024, principal repayments for the remaining period to the contractual maturity for our long term debt are as follows:
2025
$
4.1
2026
1,293.4
2027
—
2028
550.0
2029
—
Thereafter
800.0
$
2,647.5
22. Other Non-current Liabilities
December 31,
2024
December 31,
2023
Unrecognized tax benefits
$
26.7 $
25.1
Finance lease liabilities
36.7
16.4
Equipment financing obligations
26.1
36.9
Other
7.9
8.3
$
97.4 $
86.7
Equipment financing obligations are generally due in blended monthly installments over the remaining terms of the agreements which mature between 2025
and 2029.
23. Temporary Equity, Stockholders' Equity and Dividends
Series A Senior Preferred Shares
The Series A Senior Preferred Shares are convertible into common stock and were issued at an initial conversion price of $73.00 per share, which is subject to
customary anti-dilution adjustment provisions. The conversion price is $71.58 per share as of December 31, 2024. The Series A Senior Preferred Shares carry a
5.5% preferred dividend, which is payable quarterly, in cash or in shares at the Company's option, and are entitled to participate on an as-converted basis in the
Company's regular quarterly common share dividends, subject to a $0.27 per share per quarter floor.
RB Global, Inc.
85
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
23. Temporary Equity, Stockholders' Equity and Dividends (continued)
On the fourth anniversary of the issuance date of February 1, 2023, holders will have the right to increase the preferred dividend to 7.5%, and on the ninth
anniversary of the issuance date, holders will have the right to increase the preferred dividend to a fixed percentage equal to the greater of (a) 600 bps over the
daily simple SOFR as then in effect and (b) 10.50%, subject, in each case, to the Company’s right to redeem the Series A Senior Preferred Shares for which a
dividend rate increase has been demanded.
Upon consummation of one or more specified change of control transactions, the holders will have the right to require the Company to repurchase the Series A
Senior Preferred Shares in cash provided, however, that each holder, at its option, may elect instead to convert its Series A Senior Preferred Shares into the
applicable change of control consideration. In addition, the Company has the right to redeem the Series A Senior Preferred Shares in the event of a change of
control transaction where the successor entity is not traded on certain eligible markets. The possible future redemption of the Series A Senior Preferred Shares
as a result of a change in control has been assessed as not probable at December 31, 2024.
Holders of the Series A Senior Preferred Shares are entitled to vote together with the common stock on an as-converted basis on all matters permitted by
applicable law, subject to certain exceptions to enable compliance with applicable antitrust law. The Series A Senior Preferred Shares rank, with respect to
rights as to dividends, distributions, redemptions and payments upon the liquidation, dissolution and winding up of the Company, (a) senior to all of the junior
preferred stock, common stock and any other class or series of capital shares of the Company, issued or authorized after the Series A Senior Preferred Shares
issuance date, the terms of which do not expressly provide that such class or series ranks senior to or on a parity with the Series A Senior Preferred Shares, (b)
on a parity basis with each other class or series of capital shares issued or authorized after the Series A Senior Preferred Shares issuance date, the terms of
which expressly provide that such class or series ranks on a parity basis with the Series A Senior Preferred Shares, and (c) junior with each other class or series
of capital shares issued or authorized after the Series A Senior Preferred Shares issuance date, the terms of which expressly provide that such class or series
ranks on a senior basis to the Series A Senior Preferred Shares.
Redeemable Non-controlling Interests
Redeemable non-controlling interest relates to a put/call agreement with one of the minority unitholders of VeriTread under which the holder can put its
remaining 21% interest in VeriTread to the Company, if certain performance targets are met. As the purchase of the remaining 21% interest from the minority
unitholder is outside the control of the Company the redeemable non-controlling interest is classified in temporary equity on the consolidated balance sheets. At
December 31, 2024 the Company assessed that redemption of the non-controlling interest remains probable and that there has been no material change to the
estimated redemption value.
The Company also recognized an additional 4% non-controlling interest in VeriTread within equity as that interest does not contain put/call options.
RB Global, Inc.
86
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
23. Temporary Equity, Stockholders' Equity and Dividends (continued)
Common Stock Dividends
Declared and Paid
Declaration date
Dividend
per share
Record date
Total
dividends
Payment date
Year ended December 31, 2024:
Fourth quarter 2023
January 19, 2024 $
0.27
February 9, 2024 $
49.3
March 1, 2024
First quarter 2024
May 8, 2024
0.27
May 29, 2024
49.6
June 20, 2024
Second quarter 2024
August 2, 2024
0.29
August 28, 2024
53.5
September 18, 2024
Third quarter 2024
November 6, 2024
0.29
November 27, 2024
53.6
December 18, 2024
Year ended December 31, 2023:
Fourth quarter of 2022
January 13, 2023 $
0.27
February 10, 2023 $
30.0
March 3, 2023
Special Dividend
March 6, 2023
1.08
March 17, 2023
120.4
March 28, 2023
First quarter 2023
May 9, 2023
0.27
May 30, 2023
49.1
June 20, 2023
Second quarter 2023
August 2, 2023
0.27
August 23, 2023
49.2
September 13, 2023
Third quarter 2023
November 7, 2023
0.27
November 30, 2023
49.3
December 21, 2023
Year ended December 31, 2022:
Fourth quarter of 2021
January 21, 2022 $
0.25
February 11, 2022 $
27.7
March 4, 2022
First quarter 2022
May 6, 2022
0.25
May 27, 2022
27.7
June 17, 2022
Second quarter 2022
August 3, 2022
0.27
August 24, 2022
29.9
September 14, 2022
Third quarter 2022
November 2, 2022
0.27
November 23, 2022
29.9
December 14, 2022
Declared and Undistributed
Subsequent to December 31, 2024 the Company's Board of Directors declared a dividend of $0.29 per common share, payable on March 3, 2025 to
stockholders of record on February 14, 2025.
Foreign Currency Translation Reserve
Foreign currency translation adjustment, a component of other comprehensive income (loss), includes the following:
Year ended December 31,
2024
2023
2022
Gains (losses) on intercompany foreign currency transactions of a long-term investment nature
$
(9.6) $
2.3 $
(10.5)
RB Global, Inc.
87
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
24. Share-based Payments
The following table summarizes the components of share-based payment expense by consolidated income statement classification:
Year ended December 31,
2024
2023
2022
Selling, general and administrative:
Stock option compensation expense
$
3.5 $
7.7 $
12.2
Equity-classified share units
47.1
32.0
22.0
Liability-classified share units
2.9
2.5
—
Employee share purchase plan
7.3
4.7
2.8
60.8
46.9
37.0
Acquisition-related and integration costs:
Acceleration of share-based payments expense
1.0
6.8
—
Share-based continuing employment costs
0.6
3.8
7.5
1.6
10.6
7.5
$
62.4 $
57.5 $
44.5
Conversion of IAA Share Based Awards
In connection with the acquisition of IAA in March 2023, IAA’s stock options, RSUs and PSU awards were cancelled and exchanged into 187,727 Company
stock options and 366,379 Company RSU awards. At the closing of the acquisition, the converted share-based awards had an estimated aggregate fair value of
$24.9 million, of which $4.8 million was attributable to post-combination services and is being recognized as share-based payments expense over the
remaining service periods. The Company awards are subject to the same terms and conditions as applicable to the corresponding IAA equity awards held prior
to the acquisition of IAA, including vesting terms, with the exception of any Company RSU awards that replace IAA’s PSU awards, where vesting will no
longer be subject to the achievement of performance goals and will be solely based on providing continued services to the Company through the end of the
applicable service period.
Stock Option Plans
On May 8, 2023, the Company’s shareholders approved the 2023 Share Incentive Plan (“2023 Plan”) under which 9,355,000 common shares of the Company
were reserved for issuance. The 2023 Plan allows the Company to grant to employees, officers, non-employee directors and other key persons various types of
equity-based awards, including stock options, PSUs and RSUs.
At December 31, 2024, there were 7,958,801 (December 31, 2023: 8,511,523) shares available for issuance under the 2023 Plan.
RB Global, Inc.
88
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
24. Share-based Payments (continued)
The following table summarizes stock option activity:
Stock options
Premium-priced stock options
Common
shares under
option
WA
exercise
price
WA
remaining
contractual
life (in years)
Aggregate
intrinsic
value
Common
shares under
option
WA
exercise
price
WA
remaining
contractual
life (in years)
Aggregate
intrinsic
value
Outstanding, December 31, 2021
2,208,057 $
42.55
7.7 $
41.9
1,017,064 $
91.24
5.7 $
—
Granted
710,847
58.08
—
—
119,157
91.37
—
—
Exercised
(159,920)
36.72
—
4.5
—
—
—
—
Forfeited
(28,689)
48.09
—
—
(17,789)
90.93
—
—
Outstanding, December 31, 2022
2,730,295 $
46.88
7.3 $
31.2
1,118,432 $
91.26
4.7 $
—
Granted
262,725
58.09
—
—
—
—
—
—
Assumed in IAA acquisition
187,727
50.96
—
—
—
—
—
—
Exercised
(721,503)
47.67
—
10.3
—
—
—
—
Forfeited
(140,162)
53.84
—
—
(225,765)
91.26
—
—
Outstanding, December 31, 2023
2,319,082 $
47.82
6.3 $
44.5
892,667 $
91.26
3.6 $
—
Exercised
(978,238)
44.71
—
31.8
(66,309)
83.92
—
0.4
Forfeited
(12,773)
53.96
—
—
(110,671)
95.46
—
—
Outstanding, December 31, 2024
1,328,071 $
50.05
5.5 $
49.9
715,687 $
91.29
2.5 $
1.3
Exercisable, December 31, 2024
969,828 $
47.14
4.9 $
41.8
435,789 $
91.24
2.5 $
1.3
Stock options
The Company did not grant any stock options during the year ended December 31, 2024. Stock options granted previously have been valued using the Black
Scholes option pricing model. Expected volatility was based upon the historical volatility of the Company's common shares for the period corresponding with
the expected term of the options. Stock options were granted with an exercise price equal to the fair market value of the Company’s common shares at the grant
date, with a three-year vesting period and terms not exceeding 10 years. The options outstanding at December 31, 2024 expire on dates ranging to August 8,
2033. The weighted average grant date fair value of options granted during the years ended December 31, 2023 and December 31, 2022 were $17.63 and
$14.35, respectively.
The significant assumptions used to estimate the fair value of stock options granted in 2022 and 2023 are presented in the following table on a weighted
average basis:
December 31, 2023
December 31, 2022
Risk free interest rate
4.2 %
2.2 %
Expected dividend yield
1.84 %
1.74 %
Expected lives of the stock options
4 years
4 years
Expected volatility
35.8 %
31.8 %
At December 31, 2024, the unrecognized stock-based compensation cost related to non-vested stock options was $0.9 million, which is expected to be
recognized over a weighted average period of 0.9 years. Cash received from stock-based award exercises for the year ended December 31, 2024 was $49.3
million (2023: $34.5 million; 2022: $5.9 million). The actual tax benefit realized related to the exercise of stock options totaled $2.3 million for the year ended
December 31, 2024 (2023: $0.8 million; 2022: $0.4 million).
The fair value of the stock options assumed in the acquisition of IAA in March 2023 was estimated on the acquisition date using the Black-Scholes option
pricing model. The weighted average fair value of the assumed options was $15.52. The significant assumptions used to estimate the fair value of these
assumed stock options are presented in the following table on a weighted average basis:
RB Global, Inc.
89
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
24. Share-based Payments (continued)
December 31, 2023
Risk free interest rate
3.9 %
Expected dividend yield
2.05 %
Expected lives of the stock options
2 years
Expected volatility
33.3 %
Premium-priced Stock Options
In 2021 and 2022, the Company granted premium-priced stock options to senior executives with exercise prices above the fair market value of the Company’s
common shares on the respective grant dates, and which vest and become exercisable upon the third anniversary of their grant date. The weighted average
estimated grant date fair value was $8.00 per option.
The significant assumptions used to estimate the fair values using a Monte Carlo simulation model were as follows:
December 31, 2022
Risk free interest rate
3.0 %
Expected dividend yield
1.63 %
Expected lives of the stock options
4 years
Expected volatility
30.2 %
At December 31, 2024, the unrecognized compensation expense associated with premium-price options was nil.
Share Units
The following table summarizes share unit activity:
Equity-classified
Liability-classified
PSUs (Performance
Conditions)
PSUs (Market Conditions)
RSUs
DSUs
Number
WA grant
date fair
value
Number
WA grant
date fair
value
Number
WA grant
date fair
value
Number
WA grant
date fair
value
Outstanding, December 31, 2021
523,618
$
45.90
88305
$
65.45
79,112
$
54.96
156,589
$
35.28
Granted
236,855
58.53
14,574
69.92
34,495
57.71
21,824
58.24
Vested and settled
(93,241)
36.42
—
—
(37,714)
50.29
(70,048)
36.13
Forfeited
(4,598)
51.76
—
—
(7,869)
60.30
—
—
Outstanding, December 31, 2022
662,634
$
51.71
102,879
$
66.08
68,024
$
58.32
108,365
$
39.35
Granted
94,729
58.04
80,398
85.33
425,309
53.35
24,573
55.49
Assumed in IAA acquisition
—
—
—
—
366,379
52.79
—
—
Vested and settled
(283,086)
42.23
—
—
(309,102)
53.22
(32,378)
54.68
Forfeited
(58,848)
60.62
(9,017)
68.59
(10,939)
55.06
—
—
Outstanding at December 31, 2023
415,429
$
58.35
174,260
$
74.83
539,671
$
53.64
100,560
$
38.36
Granted
164,520
76.11
162,942
122.91
340,271
76.64
11,887
72.93
Vested and settled
(114,315)
58.79
(58,511)
66.08
(237,766)
53.74
(38,957)
45.28
Forfeited
(15,459)
58.37
(9,737)
84.04
(34,371)
62.12
—
—
Outstanding at December 31, 2024
450,175
$
64.73
268,954
$
105.53
607,805
$
66.00
73,490
$
40.29
RB Global, Inc.
90
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
24. Share-based Payments (continued)
PSUs
PSUs are granted to executives and senior employees and may contain performance vesting conditions or market vesting conditions, conditional upon the
Company's total shareholder return relative to a peer group. PSUs typically have three year performance and market vesting conditions. The PSUs with market
conditions granted in June 2022 have approximately a two year performance period to coincide with the remaining performance period of the August 2021
grant.
The fair value of PSUs with performance conditions are estimated on the respective grant date using the closing price of the Company’s common shares listed
on the NYSE.
The fair value of PSUs with market conditions are estimated on the grant date using a Monte Carlo simulation model. The significant assumptions used to
estimate the fair value are presented in the following table on a weighted average basis:
December 31, 2024
December 31, 2023
December 31, 2022
Risk free interest rate
4.4 %
4.5 %
2.7 %
Expected dividend yield
— %
— %
1.63 %
Expected lives of the PSUs
3 years
2 years
2 years
Expected volatility
32.2 %
32.7 %
33.4 %
Average expected volatility of comparable companies
48.3 %
48.6 %
34.4 %
At December 31, 2024, the unrecognized share unit expense related to PSUs with market conditions was $17.1 million, which is expected to be recognized
over a weighted average period of 2.07 years and the unrecognized share unit expense related to PSUs with performance conditions was $12.0 million, which is
expected to be recognized over a weighted average period of 1.92 years.
RSUs
RSUs granted to employees typically vest over a three year service period and RSUs granted to directors vest on the earlier of (i) the one year anniversary of
the grant date and (ii) the date of the Company's next annual meeting of shareholders. The issuance of shares related to RSUs granted to directors may be
deferred at the holder's election.
Fair values of RSUs are estimated on grant date using the closing price of the Company’s common shares listed on the NYSE. At December 31, 2024, the
unrecognized share unit expense related to equity-classified RSUs was $16.5 million, which is expected to be recognized over a weighted average period of
1.38 years.
DSUs
Fair values of DSUs are estimated on the respective grant date and at each reporting date using the closing price of the Company’s common shares listed on the
NYSE. DSUs are granted to members of the Board of Directors. There is no unrecognized share unit expense related to liability-classified DSUs as they vest
immediately and are expensed upon grant. At December 31, 2024, the Company had a total share unit liability of $8.4 million (2023: $7.6 million) in respect of
DSUs presented in trade and other liabilities.
The total market value of liability-classified share units which vested during the year ended December 31, 2024 was $3.2 million (2023: $1.8 million; 2022:
$4.9 million).
Employee Share Purchase Plan
In February 2023, the Board approved the suspension of the Company’s 1999 Employee Stock Purchase Plan. On May 8, 2023, the Company's shareholders
approved the 2023 Employee Stock Purchase Plan (the "2023 ESPP") under which 3,000,000 common shares of the Company were reserved for issuance. The
2023 ESPP allows eligible employees to contribute up to 15% of their base compensation during each semi-annual offering period, up to twenty-five thousand
dollars, towards the purchase of the Company’s stock, at 85% of the lower of the fair market value on: i. the first day of the applicable offering period, or ii. the
last day of the applicable purchase period within the offering period. Employees also have the option to participate through a cashless program, by electing to
settle on a net basis on purchase date. At the end of each purchase period, employee contributions are used to purchase the Company's common stock.
RB Global, Inc.
91
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
24. Share-based Payments (continued)
During each of the years ended December 31, 2024 and December 31, 2023, there were two offerings under the 2023 ESPP. The 2024 offerings had weighted
average grant date fair values of $15.94 and $19.42 (2023: $11.99 and $12.43).
The significant assumptions used to estimate the fair value of ESPP awards are presented in the following table on a weighted average basis:
December 31, 2024
December 31, 2023
Risk free interest rate
4.4 %
5.3 %
Expected dividend yield
1.26 %
1.81 %
Expected lives of the ESPP
9 months
8 months
Expected volatility
27.5 %
28.1 %
At December 31, 2024, there were 2,306,355 (December 31, 2023: 2,819,497) shares available for issuance under the 2023 ESPP.
25. Leases
The components of lease expense are as follows:
Year ended December 31,
2024
2023
2022
Operating lease cost
$
250.8 $
192.1 $
23.0
Finance lease cost
Amortization of leased assets
12.5
11.3
10.2
Interest on lease liabilities
1.7
1.3
0.8
Short-term lease cost
12.6
17.0
12.2
Sublease income
(1.0)
(0.6)
(0.1)
$
276.6 $
221.1 $
46.1
Operating Leases
The Company has entered into leases for various properties used for auctions or offices, the majority of which are non-cancellable. The Company also has
leases for computer equipment, motor vehicles and small office equipment where it is not in the best interest of the Company to purchase these assets. The
majority of the Company's operating leases have a fixed term with a remaining life between one month and 19 years, with renewal options included in the
contracts. The leases have varying contract terms, escalation clauses and renewal options. Generally, there are no restrictions placed upon the lessee by entering
into these leases, other than restrictions on use of property, sub-letting and alterations. The Company has not included any purchase options available within its
operating lease portfolio in its determination of its operating lease liability.
RB Global, Inc.
92
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
25. Leases (continued)
The future aggregate minimum lease payments under non-cancellable operating leases are as follows:
2025
$
195.9
2026
201.1
2027
194.6
2028
183.9
2029
172.7
Thereafter
1,220.8
Total future minimum lease payments
$
2,169.0
less: imputed interest
(624.6)
Total operating lease liabilities
$
1,544.4
less: current operating lease liabilities
(113.3)
Long-term operating lease liabilities
$
1,431.1
At December 31, 2024, the weighted average remaining lease term for operating leases is 11.8 years (December 31, 2023: 12.4 years) and the weighted average
discount rate is 5.6% (December 31, 2023: 4.3%). There are no additional undiscounted commitments for leases not yet commenced at December 31, 2024
(December 31, 2023: nil).
Finance Leases
The Company has entered into finance lease arrangements for certain vehicles, computer and yard equipment, fixtures, and office furniture. The majority of the
leases have a fixed term with a remaining life of one month to five years with renewal options included in the contracts. In certain of these leases, the Company
has the option to purchase the leased asset at fair market value or a stated residual value at the end of the lease term. For certain leases such as vehicle leases,
the Company has included renewal options in the measurement of its lease balances.
Property, plant, and equipment includes the following finance lease assets:
At December 31, 2024
Cost
Accumulated
depreciation
Net book
value
Auto equipment
$
32.8 $
(16.6) $
16.2
Computer equipment
14.3
(9.9)
4.4
Yard and others
38.5
(10.0)
28.5
$
85.6 $
(36.5) $
49.1
At December 31, 2023
Cost
Accumulated
depreciation
Net book
value
Auto equipment
$
27.6 $
(13.0) $
14.6
Computer equipment
15.4
(8.4)
7.0
Yard and others
10.9
(7.4)
3.5
$
53.9 $
(28.8) $
25.1
RB Global, Inc.
93
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in millions of United States dollars, except where noted)
25. Leases (continued)
The future aggregate minimum lease payments under non-cancellable finance leases are as follows:
2025
$
15.1
2026
13.8
2027
11.8
2028
8.2
2029
4.8
Total future minimum lease payments
$
53.7
less: imputed interest
(3.1)
Total finance lease liabilities
$
50.6
less: current finance lease liabilities
(13.9)
Long-term finance lease liabilities
$
36.7
At December 31, 2024, the weighted average remaining lease term for finance leases is 3.9 years (December 31, 2023: 3.2 years) and the weighted average
discount rate is 6.1% (December 31, 2023: 5.7%).
Subleases
At December 31, 2024, the total future minimum sublease payments expected to be received under non-cancellable subleases is $6.4 million (December 31,
2023: $2.6 million).
26. Commitments
At December 31, 2024, the Company had committed to capital expenditures for property, plant and equipment totaling approximately $26.9 million
(December 31, 2023: $36.5 million) and expenditures for intangible assets and technology services agreements totaling approximately $26.7 million
(December 31, 2023: $28.6 million).
27. Contingencies
Legal and Other Claims
On July 31, 2023, Ann Fandozzi informed the Company’s Board of her intention to resign from her position as the Company’s Chief
Executive Officer due to a disagreement with the Company regarding her compensation as Chief Executive Officer. The Board accepted her verbal resignation
and interpreted her subsequent conduct as affirmation of her resignation. The Company advised Ms. Fandozzi that it was accepting her resignation effective
immediately and waiving any written procedural notice requirements under the Employment Agreement by and between Ritchie Bros. Auctioneers (Canada)
Ltd. and Ms. Fandozzi, dated December 14, 2019. Ms. Fandozzi disputes that she tendered her resignation. On February 21, 2024, Ms. Fandozzi formally
resigned from the Company’s Board. The matter is currently in arbitration in accordance with the terms of Ms. Fandozzi’s employment agreement.
During the year ended December 31, 2024, the Company recorded an expense of $5.0 million (December 31, 2023: $6.2 million) reflecting changes to the
estimated fair value of certain share-based payment awards. Any changes to the estimated payment amount to Ms. Fandozzi as a result of the settlement of the
matter could be material.
The Company is subject to legal and other claims that arise in the ordinary course of its business. Management does not believe that the results of these claims
will have a material effect on the Company’s consolidated balance sheets or consolidated income statements.
Guarantee Contracts
In the normal course of business, the Company will in certain situations guarantee to a consignor a minimum level of proceeds in connection with the sale at
auction of that consignor’s equipment.
At December 31, 2024, there were $39.1 million of assets guaranteed under contract, of which 44% is expected to be sold prior to March 31, 2025 with the
remainder to be sold by December 31, 2025 (December 31, 2023: $67.5 million of which 70% was expected
RB Global, Inc.
94
Table of Contents
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of United States dollars, except where noted)
27. Contingencies (continued)
to be sold prior to the end of March 31, 2024 with the remainder to be sold by December 31, 2024). The outstanding guarantee amounts are undiscounted and
before estimated proceeds from sale at auction.
RB Global, Inc.
95
Table of Contents
ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
ITEM 9A: CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Management of the Company, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), have evaluated the effectiveness of the
Company’s disclosure controls and procedures as of the end of the year covered by this Form 10-K. The term “disclosure controls and procedures” means
controls and other procedures established by the Company that are designed to ensure that information required to be disclosed by the Company in the reports
that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its CEO
and CFO, as appropriate, to allow timely decisions regarding required disclosure.
Based upon their evaluation of the Company’s disclosure controls and procedures, as of December 31, 2024, the CEO and the CFO concluded that the
disclosure controls are effective to provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or submits
under the Exchange Act is accumulated and communicated to management, including the CEO and CFO, as appropriate, to allow timely decisions regarding
required disclosure and were effective to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time
periods specified by the SEC’s rules and forms.
The Company, including its CEO and CFO, does not expect that its internal controls and procedures will prevent or detect all error and all fraud. A control
system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.
Management’s Report on Internal Control over Financial Reporting
Management of the Company is responsible for establishing and maintaining adequate internal controls over financial reporting for the Company as defined in
Rule 13a-15(f) and 15d-15(f) under the Exchange Act. The Company’s internal control over financial reporting is a process designed under the supervision of
the Company’s CEO and CFO, overseen by the Company’s Board of Directors and implemented by the Company’s management and other personnel, to
provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance
with U.S. generally accepted accounting principles, and the requirements of the SEC.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance
with policies and procedures may deteriorate.
Management has assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024. In making this assessment,
management used the criteria described in “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway
Commission (2013 Framework) (“COSO”). Based on its assessment under the framework in COSO, management has concluded that internal control over
financial reporting was effective as of December 31, 2024.
Attestation Report of Registered Public Accounting Firm
The attestation report required under this Item 9A is set forth below under the caption “Report of Independent Registered Public Accounting Firm.”
Changes in Internal Control over Financial Reporting
There were no changes in the Company's internal control over financial reporting during the fourth quarter of 2024 that have materially affected, or are
reasonably likely to materially affect the Company's internal control over financial reporting.
RB Global, Inc.
96
Table of Contents
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of RB Global, Inc.
Opinion on Internal Control Over Financial Reporting
We have audited RB Global, Inc.’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our
opinion, RB Global, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based
on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated
balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, changes in
temporary equity and stockholders’ equity, and cash flows, for each of the two years in the period ended December 31, 2024, and the related notes and our
report dated February 26, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of
internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility
is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the
PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and
evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over
financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being
made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Chicago, Illinois
February 26, 2025
ITEM 9B: OTHER INFORMATION
None.
RB Global, Inc.
97
Table of Contents
ITEM 9C: DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
None.
PART III
ITEM 10: DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information responsive to this Item is incorporated by reference to our definitive Proxy Statement for our 2025 Annual and Special Meeting of
Shareholders, to be filed within 120 days of December 31, 2024, pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the
"2025 Proxy Statement").
We have adopted a written code of business conduct and ethics, which applies to all of our directors, officers and employees, including our principal executive
officer and our principal financial and accounting officer. Our Code of Business Conduct and Ethics is available on our website
(https://investor.rbglobal.com/governance/governance-documents/default.aspx) and can be obtained by writing to RB Global Investor Relations, Two
Westbrook Corporate Center, Suite #500, Westchester, Illinois, USA 60154, or by sending an email to our Investor Relations department at IR@rbglobal.com.
The information contained on our website is not incorporated by reference into this Annual Report on Form 10-K. Any amendments, other than technical,
administrative or other non-substantive amendments, to our Code of Business Conduct and Ethics or waivers from the provisions of the Code of Business
Conduct and Ethics for our principal executive officer and our principal financial and accounting officer will be promptly disclosed on our website following
the effective date of such amendment or waiver.
The Company has an insider trading policy governing the purchase, sale and other dispositions of the Company's securities that applies to all Company's
directors, officers, employees and other covered persons. The Company believes that its insider trading policy is reasonably designed to promote compliance
with insider trading laws, rules and regulations, and listing standards applicable to the Company. A copy of the Company's insider trading policy is filed as
Exhibit 19.1 to this Form 10-K.
ITEM 11: EXECUTIVE COMPENSATION
The information responsive to this Item is incorporated by reference to our 2025 Proxy Statement.
ITEM 12: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
The information responsive to this Item is incorporated by reference to our 2025 Proxy Statement.
ITEM 13: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information responsive to this Item is incorporated by reference to our 2025 Proxy Statement.
ITEM 14: PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information responsive to this Item is incorporated by reference to our 2025 Proxy Statement.
PART IV
ITEM 15: EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a) Documents Filed with this Report:
(1) FINANCIAL STATEMENTS
RB Global, Inc.
98
Table of Contents
Reports of Independent Registered Public Accounting Firms
52
Consolidated Income Statements
55
Consolidated Statements of Comprehensive Income
56
Consolidated Balance Sheets
57
Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity
58
Consolidated Statements of Cash Flows
60
Notes to the Consolidated Financial Statements
61
(2) FINANCIAL STATEMENT SCHEDULES
None.
(3) EXHIBITS
The exhibits listed in (b) below are filed as part of this Annual Report on Form 10-K and incorporated herein by reference.
(b) Exhibits:
Exhibit
Number
Document
2.1*
Agreement and Plan of Merger and Reorganization, dated as of November 7, 2022, by and among Ritchie Bros. Auctioneers Incorporated,
Ritchie Bros. Holdings Inc., Impala Merger Sub I, LLC, Impala Merger Sub II, LLC, and IAA, Inc. (incorporated by reference to Exhibit 2.1 to
the Company’s Current Report on Form 8-K filed on November 7, 2022)
2.2
Amendment to the Agreement and Plan of Merger and Reorganization, dated January 22, 2023, by and among Ritchie Bros. Auctioneers
Incorporated, Ritchie Bros, Holdings Inc., Impala Merger Sub I, LLC, Impala Merger Sub II, LLC, and IAA, Inc. (incorporated by reference to
Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on January 22, 2023)
3.1
RB Global, Inc. Articles of Continuance
3.2
RB Global, Inc. By-law No. 2
4.1
Second Amended and Restated Shareholder Rights Plan Agreement dated as of February 24, 2025 between RB Global, Inc. and Computershare
Investor Services, Inc., as Rights Agent
4.2
Description of the Company’s Securities Registered Pursuant to Section 12 of the Exchange Act (incorporated by reference to Exhibit 4.2 to the
Company’s Annual Report on Form 10-K filed on February 27, 2020)
4.3
Indenture, dated as of March 15, 2023, among Ritchie Bros. Auctioneers Incorporated, Ritchie Bros. Holdings Inc. and U.S. Bank Trust
Company, National Association, as trustee, and U.S. Bank Trust Company, National Association, as collateral agent, relating to Ritchie Bros.
Holdings Inc.’s 6.750% Senior Secured Notes due 2028 (includes form of note) (incorporated by reference to Exhibit 4.1 to the Company’s
Current Report on Form 8-K filed on March 15, 2023)
4.4
Supplemental Indenture, dated as of March 20, 2023, by and between Ritchie Bros. Holdings Inc., as issuer, the parties that are signatories
thereto as Subsidiary Guarantors, as subsidiary guarantors, and U.S. Bank Trust Company, National Association, as trustee (incorporated by
reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on March 21, 2023)
4.5
Indenture, dated as of March 15, 2023, among Ritchie Bros. Auctioneers Incorporated, Ritchie Bros. Holdings Inc. and U.S. Bank Trust
Company, National Association, as trustee, relating to Ritchie Bros. Holdings Inc.’s 7.750% Senior Notes due 2031 (includes form of note)
(incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on March 15, 2023)
4.6
Supplemental Indenture, dated as of March 20, 2023, by and between Ritchie Bros. Holdings Inc., as issuer, the parties that are signatories
thereto as Subsidiary Guarantors, as subsidiary guarantors, and U.S. Bank Trust Company, National Association, as trustee and collateral agent
(incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K filed on March 21, 2023)
4.7
Intercreditor Agreement, dated as of March 20, 2023, by and between Bank of America, N.A., as administrative agent, and U.S. Bank Trust
Company, National Association, as collateral agent, and consented to by the Company and the subsidiaries of the Company party to such
consent as grantors of Collateral (incorporated by reference to Exhibit 4.5 to the Company’s Current Report on Form 8-K filed on March 21,
2023)
RB Global, Inc.
99
Table of Contents
10.1#
Amended and Restated Stock Option Plan, dated May 2, 2016 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on
Form 10-Q filed on August 8, 2016)
10.2#
Form of Stock Option Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Annual Report on Form 10-K filed on February
25, 2016)
10.3#
Amended and Restated Executive Long-Term Incentive Plan (incorporated by reference to Exhibit 10.4 to the Company’s Annual Report on
Form 10-K filed on February 25, 2016)
10.4#
Non-Executive Director Long-Term Incentive Plan (incorporated by reference to Exhibit 10.5 to the Company’s Annual Report on Form 10-K
filed on February 25, 2016)
10.5#
Amended and Restated Senior Executive Restricted Share Unit Plan (incorporated by reference to Exhibit 4.1 to the Company’s registration
statement on Form S-8 filed on November 9, 2017)
10.6#
Form of Restricted Share Unit Grant Agreement for Amended and Restated Senior Executive Restricted Share Unit Plan (incorporated by
reference to Exhibit 10.7 to the Company’s Annual Report on Form 10-K filed February 26, 2018)
10.7#
Form of Restricted Share Unit Special Grant Agreement for Amended and Restated Senior Executive Restricted Share Unit Plan (incorporated
by reference to Exhibit 10.8 to the Company’s Annual Report on Form 10-K filed February 26, 2018)
10.8#
Amended and Restated Employee Restricted Share Unit Plan (incorporated by reference to Exhibit 4.2 to the Company’s registration statement
on Form S-8 filed on November 9, 2017)
10.9#
Form of Restricted Share Unit Grant Agreement for Amended and Restated Employee Restricted Share Unit Plan (incorporated by reference to
Exhibit 10.10 to the Company’s Annual Report on Form 10-K filed February 26, 2018)
10.10#
Amended and Restated Non-Executive Director Deferred Share Unit Plan (incorporated by reference to Exhibit 10.11 to the Company’s Annual
Report on Form 10-K filed February 26, 2018)
10.11#
Executive Nonqualified Excess Plan (United States 10/10 Program) (incorporated by reference to Exhibit 10.14 to the Company’s Annual
Report on Form 10-K filed on February 25, 2016)
10.12#
Amended Executive Nonqualified Excess Plan (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q
filed on May 10, 2018)
10.13#
Canada and All Non-United States Locations: 10/10 Compensation Arrangement (Canada 10/10 Program) (incorporated by reference to Exhibit
10.15 to the Company’s Annual Report on Form 10-K filed on February 25, 2016)
10.14#
Senior Executive Performance Share Unit Plan (March 2015) (incorporated by reference to Exhibit 10.16 to the Company’s Annual Report on
Form 10-K filed on February 25, 2016)
10.15#
Amendment No. 1 to Senior Executive Performance Share Unit Plan dated August 8, 2018 (incorporated by reference to Exhibit 10.1 to the
Company’s Quarterly Report on Form 10-Q filed on November 11, 2018)
10.16#
Form of Performance Share Unit Grant Agreement for Senior Executive Performance Share Unit Plan (March 2015) (incorporated by reference
to Exhibit 10.17 to the Company’s Annual Report on Form 10-K filed on February 25, 2016)
10.17#
Employee Performance Share Unit Plan (March 2015) (incorporated by reference to Exhibit 10.18 to the Company’s Annual Report on Form
10-K filed on February 25, 2016)
10.18#
Amendment No. 1 to Employee Performance Share Unit Plan dated August 8, 2018 (incorporated by reference to Exhibit 10.2 to the
Company’s Quarterly Report on Form 10-Q filed on November 11, 2018)
10.19#
Form of Performance Share Unit Grant Agreement for Employee Performance Share Unit Plan (March 2015) (incorporated by reference to
Exhibit 10.19 to the Company’s Annual Report on Form 10-K filed on February 25, 2016)
10.20#
Employment Agreement between Ritchie Bros. Auctioneers (Canada) Ltd. and Darren Watt, dated May 25, 2015 (incorporated by reference to
Exhibit 10.32 to the Company’s Annual Report on Form 10-K filed on February 25, 2016)
10.21#
Form of Change of Control Agreement (incorporated by reference to Exhibit 10.37 to the Company’s Annual Report on Form 10-K filed on
February 25, 2016)
10.22#
Form of Indemnity Agreement (incorporated by reference to Exhibit 10.38 to the Company’s Annual Report on Form 10-K filed on February
25, 2016)
10.23#
Summary of Short-term Incentive Plan (incorporated by reference to Exhibit 10.44 to the Company’s Annual Report on Form 10-K filed on
February 25, 2016)
10.24
Credit Agreement, dated as of October 27, 2016, by and among the Company, the other borrowers and guarantors party thereto, Bank of
America, N.A., as administrative agent, U.S. swing line lender and L/C issuer, Royal Bank of Canada, as Canadian swing line lender and L/C
issuer, and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K/A filed on
November 4, 2016)
RB Global, Inc.
100
Table of Contents
10.25
First Amendment, dated as of January 17, 2017, to Credit Agreement, dated as of October 27, 2016, by and among the Company, the other
borrowers and guarantors party thereto, Bank of America, N.A., as administrative agent, U.S. swing line lender and L/C issuer, Royal Bank of
Canada, as Canadian swing line lender and L/C issuer, and the other lenders party thereto (incorporated by reference to Exhibit 10.50 to the
Company’s Annual Report on Form 10‐K filed on February 21, 2017)
10.26
Third Amendment to Credit Agreement, dated as of August 14, 2020, among the Company, certain of its subsidiaries, each as a borrower and/or
a guarantor, the lenders party thereto and Bank of America, N.A., as administrative agent, U.S. swing line lender and letter of credit issuer
(incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 17, 2020)
10.27
Fourth Amendment to Credit Agreement, dated as of September 21, 2021, among the Company, certain of its subsidiaries, each as a borrower
and/or a guarantor, the lenders party thereto, Bank of America, N.A., as administrative agent, U.S. swing line lender and letter of credit issuer
and Royal Bank of Canada, as Canadian swing line lender and letter of credit issuer (incorporated by reference to Exhibit 10.1 to the
Company’s Current Report on Form 8-K filed on September 21, 2021)
10.28#
IronPlanet, Inc. 1999 Stock Plan (incorporated by reference to Exhibit 4.1 to the Company’s registration statement on Form S-8 filed on June 1,
2017)
10.29#
Form of Stock Option Agreement for IronPlanet, Inc. 1999 Stock Plan (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly
Report on Form 10-Q filed on August 8, 2017)
10.30#
IronPlanet Holdings, Inc. 2015 Stock Plan (incorporated by reference to Exhibit 4.2 to the Company’s registration statement on Form S-8 filed
on June 1, 2017)
10.31#
Form of Stock Option Agreement for IronPlanet Holdings, Inc. 2015 Stock Plan (incorporated by reference to Exhibit 10.5 to the Company’s
Quarterly Report on Form 10-Q filed on August 8, 2017)
10.32#
Form of Ritchie Bros. Auctioneers Incorporated Stock Option Assumption Notice (incorporated by reference to Exhibit 10.6 to the Company’s
Quarterly Report on Form 10-Q filed on August 8, 2017)
10.33#
Employment Agreement between Ritchie Bros. Auctioneers (America) Inc. and James Jeter, dated August 28, 2016 (incorporated by reference
to Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q filed on August 8, 2017)
10.34#
Employment Agreement between Ritchie Bros. Auctioneers (Canada) Ltd. and James Kessler dated December 20, 2023 (incorporated by
reference to Exhibit 10.38 to the Company’s Annual Report on Form 10‐K filed on February 28, 2024)
10.35#
Employment Agreement between Ritchie Bros. Auctioneers (Canada) Ltd. and Eric Guerin dated December 11, 2023 (incorporated by
reference to Exhibit 10.39 to the Company’s Annual Report on Form 10‐K filed on February 28, 2024)
10.36#
Employment Agreement between Ritchie Bros. Auctioneers (Canada) Ltd. and Andrew Fesler, dated December 13, 2023 (incorporated by
reference to Exhibit 10.43 to the Company’s Annual Report on Form 10‐K filed on February 28, 2024)
10.37#
Employment Agreement between Ritchie Bros. Auctioneers (Canada) Ltd. and Michael (Steve) Lewis, dated July 19, 2024 (incorporated by
reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on November 8, 2024)
10.38#
Employment Agreement between Ritchie Bros. Auctioneers (Canada) Ltd. and Nancy King, dated March 6, 2024 (incorporated by reference to
Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on November 8, 2024)
10.39
Commitment Letter, dated as of November 7, 2022, by and among Ritchie Bros. Auctioneers Incorporated, Goldman Sachs Bank, Bank of
America, N.A., BofA Securities, Inc., Royal Bank of Canada and RBC Capital Markets, LLC (incorporated by reference to Exhibit 10.1 to the
Company’s Current Report on Form 8-K filed on November 7, 2022)
10.40
Sixth Amendment to Credit Agreement, dated as of December 9, 2022, among the Company, certain of its subsidiaries, each as a borrower
and/or a guarantor, the lenders party thereto, Bank of America, N.A., as administrative agent, U.S. swing line lender and a letter of credit issuer
(incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 12, 2022)
10.41
Securities Purchase Agreement, dated as of January 22, 2023, by and among Ritchie Bros. Auctioneers Incorporated, Starboard Value LP,
Jeffrey Smith and the purchasers named therein (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed
on January 23, 2023)
10.42
Registration Rights Agreement, dated as of February 1, 2023, by and among Ritchie Bros. Auctioneers Incorporated and the Purchasers named
therein (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 1, 2023)
RB Global, Inc.
101
Table of Contents
10.43
Purchase Agreement, dated March 1, 2023, by and among Ritchie Bros. Holdings Inc., Ritchie Bros. Auctioneers Incorporated and Goldman
Sachs & Co. LLC, as representative of the several initial purchasers named therein (incorporated by reference to Exhibit 99.1 to the Company’s
Current Report on Form 8-K filed on March 2, 2023)
10.44
Escrow and Security Agreement, dated as of March 15, 2023, among Ritchie Bros. Holdings Inc., U.S. Bank Trust Company, National
Association, as escrow agent, and U.S. Bank Trust Company, National Association, as trustee, relating to the Issuer’s 6.750% senior secured
notes due 2028 (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on March 15, 2023)
10.45
Escrow and Security Agreement, dated as of March 15, 2023, among Ritchie Bros. Holdings Inc., U.S. Bank Trust Company, National
Association, as escrow agent, and U.S. Bank Trust Company, National Association, as trustee, relating to the Issuer’s 7.750% senior notes due
2031 (incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K filed on March 15, 2023)
10.46#
RB Global Amended and Restated 2023 Share Incentive Plan
10.47#
Ritchie Bros. Auctioneers Incorporated 2023 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.2 to the Company’s
Current Report on Form 8-K filed on May 10, 2023)
10.48#
Non-Employee Director Global Restricted Share Unit Award Agreement under the RB Global, Inc. 2023 Share Incentive Plan (incorporated by
reference to Exhibit 10.53 to the Company’s Annual Report on Form 10‐K filed on February 28, 2024)
10.49#
Non-Employee Director Global Restricted Share Unit Award Agreement (Deferred) under the RB Global, Inc. 2023 Share Incentive Plan
(incorporated by reference to Exhibit 10.54 to the Company’s Annual Report on Form 10‐K filed on February 28, 2024)
10.50#
2023 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on May
10, 2023)
19.1
RB Global, Inc. Policy Regarding Securities Trades by Company Personnel
21.1
List of Company Subsidiaries
23.1
Consent of Ernst & Young LLP
23.2
Consent of Ernst & Young LLP
31.1
Certificate of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2
Certificate of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
Certificate of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2
Certificate of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1
RB Global, Inc. Amended and Restated Executive Compensation Clawback Policy, adopted November 7, 2023 (incorporated by reference to
Exhibit 97.1 to the Company’s Annual Report on Form 10‐K filed on February 28, 2024)
101.INS
Inline XBRL Instance Document
101.SCH
Inline XBRL Taxonomy Extension Schema Document
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document
104
Cover Page for the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, formatted in Inline XBRL
_____________________________________________________
# Indicates management contract or compensatory plan or arrangement.
* Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant will furnish copies of any such schedules to the U.S. Securities
and Exchange Commission upon request.
ITEM 16: FORM 10-K SUMMARY
Not applicable.
RB Global, Inc.
102
Table of Contents
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
RB Global, Inc.
Date: February 26, 2025
By:
/s/ Jim Kessler
Jim Kessler
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
By:
/s/ Jim Kessler
Chief Executive Officer
February 26, 2025
Jim Kessler
(principal executive officer)
By:
/s/ Eric J. Guerin
Chief Financial Officer
February 26, 2025
Eric J. Guerin
(principal financial officer)
By:
/s/ Robert G. Elton
Chair of the Board
February 26, 2025
Robert G. Elton
By:
/s/ Brian Bales
Director
February 26, 2025
Brian Bales
By:
/s/ Adam DeWitt
Director
February 26, 2025
Adam DeWitt
By:
/s/ Gregory Morrison
Director
February 26, 2025
Gregory Morrison
By:
/s/ Timothy O'Day
Director
February 26, 2025
Timothy O'Day
By:
/s/ Sarah E Raiss
Director
February 26, 2025
Sarah E. Raiss
By:
/s/ Michael Sieger
Director
February 26, 2025
Michael Sieger
By:
/s/ Debbie Stein
Director
February 26, 2025
Debbie Stein
By:
/s/ Carol Stephenson
Director
February 26, 2025
Carol Stephenson
RB Global, Inc.
103
Exhibit 3.1
Ministry of Public and Business Service
Delivery Ministère des Services au public et
aux entreprises
Certificate of Continuance Certificat de maintien
Business Corporations Act Loi sur les sociétés par actions
RB
GLOBAL, INC.
Corporation Name / Dénomination sociale
1001014884
Ontario Corporation Number / Numéro de société de l’Ontario
This is to certify that these articles are effective on La présente vise à attester que ces statuts entreront en
vigueur le
September 24, 2024 / 24 septembre 2024
Director / Directeur
Business Corporations Act / Loi sur les sociétés par actions
The Certificate of Continuance is not complete
without the Articles of Continuance
Certified a true copy of the record of the Ministry of Public and
Business Service Delivery.
Director/Registrar
Exhibit 3.1
Le certificat de maintien
n’est pas complet s’il ne
contient pas les statuts de
maintien
Copie
certifiée
conforme
du
dossier
du
ministère
des
Services
au public
et
aux
entreprises.
Directeur ou registrateur
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Ministry of Public and Business
Service Delivery
Articles of Continuance
Business Corporations Act
1. Corporation Name
RB Global, Inc.
2. Date of Incorporation/Amalgamation
December 12, 1997
3. Name of jurisdiction the corporation is leaving
Canada - Federal
4. The continuance was authorized by home jurisdiction on
September 16, 2024
5. The corporation is continued in Ontario under the name
RB GLOBAL, INC.
6. Registered Office Address
66 Wellington Street West, Unit 5300, Toronto, Ontario, M5K1E6, Canada
7. Number of Directors
Minimum/Maximum Min 3 / Max 12
Exhibit 3.1
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 1 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
8. The director(s) is/are:
Full Name BRIAN BALES
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Address for Service United States
Full Name ADAM DEWITT
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Address for Service United States
Full Name ROBERT GEORGE ELTON
9500 Glenlyon Parkway, Burnaby, British Columbia, V5J0C6,
Address for Service Canada
Full Name JAMES KESSLER
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Address for Service United States
Full Name GREGORY MORRISON
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Address for Service United States
Full Name TIMOTHY O'DAY
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Address for Service United States
Full Name SARAH RAISS
9500 Glenlyon Parkway, Burnaby, British Columbia, V5J0C6,
Address for Service Canada
Full Name MICHAEL SIEGER
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Address for Service United States
Full Name JEFFREY C. SMITH
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Address for Service United States
Full Name DEBBIE STEIN
9500 Glenlyon Parkway, Burnaby, British Columbia, V5J0C6,
Address for Service Canada
Full Name CAROL STEPHENSON
9500 Glenlyon Parkway, Burnaby, British Columbia, V5J0C6,
Address for Service Canada
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 2 of 50
Exhibit 3.1
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
9.
Restrictions, if any, on business the corporation may carry on or on powers the corporation may exercise. If none, enter "None":
N/A
10. The classes and any maximum number of shares that the corporation is authorized to issue:
The Corporation is authorized to issuance: (i) an unlimited number of Common shares; (ii) an unlimited number of Preferred shares designated as
Junior Preferred shares, issuable in series; and (iii) an unlimited number of Preferred shares, designated as Senior Preferred shares, issuable in
series of which 485,000,000 are designated as Series A Senior Preferred shares.
11.
Rights, privileges, restrictions and conditions (if any) attaching to each class of shares and directors' authority with respect to any class of shares
which may be issued in series. If there is only one class of shares, enter "Not Applicable":
COMMON SHARES
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Common Shares (the “Common Shares”) in the capital of the
Corporation.
Voting Rights. The Common Shares shall entitle the holders thereof to notice of, to attend and to 1 vote for each Common Share held at all meetings
of the shareholders, except meetings at which only holders of a specified class or series of shares of the Cor- poration are entitled to vote separately
as a class or series.
Dividend Rights. Subject to the prior rights of the holders of the Senior Preferred Shares, the Junior Preferred Shares and any other shares ranking
senior to the Common Shares with respect to priority in the payment of dividends, the holders of the Com- mon Shares shall be entitled to receive and
the Corporation shall pay thereon dividends if, as and when declared by the board of directors of the Corporation out of moneys or assets of the
Corporation properly applicable to the payment of dividends in such amount and payable in such manner as the board of directors may from time to
time determine. Subject to the rights of the holders of any other class of shares of the Corporation entitled to receive dividends in priority to or with the
holders of the Com- mon Shares, the board of directors may in their sole discretion declare dividends on the Common Shares to the exclusion of any
other class of shares of the Corporation.
Rights upon Dissolution. Subject to the prior rights of the holders of the Senior Preferred Shares, the Junior Preferred Shares and any other shares
ranking senior to the Common Shares with respect to priority in the distribution of assets, the holders of the Common Shares shall be entitled to
receive the remaining property and assets of the Corporation in the event of the liquidation, dissolution or winding-up of the Corporation, whether
voluntary or involuntary, or any other distribution of the assets of the Cor- poration among its shareholders for the purpose of winding up its affairs,
provided that such remaining property and assets shall be paid or distributed equally share for share to the holders of the Common Shares at the time
outstanding without prefer- ence or priority.
SENIOR PREFERRED SHARES
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 3 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Senior Preferred shares (the “Senior Preferred Shares”),
as a class in the capital of the Corporation.
Directors’ Authority to Issue in One or More Series. The directors of the Corporation may issue the Senior Preferred Shares at any time and from time
to time in one or more series. Before any shares of a particular series are issued, the directors of the Corporation shall fix the number of shares that
will form such series and shall determine, subject to the limitations set out in the articles, the designation, rights, privileges, restrictions and conditions
to be attached to the Senior Preferred Shares of such series, including, but without in any way limiting or restricting the generality of the foregoing, the
rate or rates, amount or method or methods of calculation of dividends thereon, the currency or currencies of payment of dividends, the time and place
of payment of dividends, the consideration and the terms and conditions of any purchase for cancellation, retraction or redemp- tion rights (if any), the
conversion or exchange rights attached thereto (if any), the voting rights attached thereto (if any) and the terms and conditions of any share purchase
plan or sinking fund with respect thereto. Before the issue of the first shares of a series, the directors shall send to the Director (as defined in the
Business Corporations Act (Ontario) articles of amendment con- taining a description of such series including the designation, rights, privileges,
restrictions and conditions determined by the dir- ectors.
Ranking of Senior Preferred Shares. No rights, privileges, restrictions or conditions attached to a series of Senior Preferred Shares shall confer upon a
series a priority in respect of dividends or return of capital over any other series of Senior Preferred Shares. The Senior Preferred Shares shall be
entitled to priority over the Junior Preferred Shares and Common Shares of the Cor- poration and over any other shares ranking junior to the Senior
Preferred Shares with respect to priority in the payment of di- vidends and the distribution of assets in the event of the liquidation, dissolution or
winding-up of the Corporation, whether vol- untary or involuntary, or any other distribution of the assets of the Corporation among its shareholders for
the purpose of wind- ing up its affairs. If any cumulative dividends or amounts payable on a return of capital in respect of a series of Senior Preferred
Shares are not paid in full, the Senior Preferred Shares of all series shall participate rateably in respect of such dividends, includ- ing accumulations, if
any, in accordance with the sums that would be payable on such shares if all such dividends were declared and paid in full, and in respect of any
repayment of capital in accordance with the sums that would be payable on such repay- ment of capital if all sums so payable were paid in full;
provided, however, that in the event of there being insufficient assets to satisfy in full all such claims as aforesaid, the claims of the holders of the
Senior Preferred Shares with respect to repayment of capital shall first be paid and satisfied and any assets remaining thereafter shall be applied
towards the payment and satisfaction of claims in respect of dividends. The Senior Preferred Shares of any series may also be given such other
preferences not incon- sistent with clauses (1) to (4) hereof over the Junior Preferred Shares and Common Shares and over any other shares ranking
ju- nior to the Senior Preferred Shares as may be determined in the case of such series of Senior Preferred Shares.
Voting Rights. Except as hereinafter referred to or as otherwise provided by law or in accordance with any voting rights which may from time to time
be attached to any series of Senior Preferred Shares, the holders of the Senior Preferred Shares as a class shall not be entitled as such to receive
notice of, to attend or to vote at any meeting of the shareholders of the Corporation.
Approval of Holdings of Senior Preferred Shares. The rights, privileges, restrictions and conditions attaching to the Senior Pre- ferred Shares as a
class may be added to, changed or removed but only with the approval of the holders of Senior Preferred Shares given as hereinafter specified.
The approval of the holders of Senior Preferred Shares to add to, change or remove any right, privilege, restriction or condition attaching to the Senior
Preferred Shares as a class or any other matter requiring the consent of the holders of the Senior Pre- ferred Shares as a class may be given in such
manner as may then be required by law, subject to a minimum requirement that such approval be given by resolution passed by the affirmative vote of
at least 2/3 of the votes cast at a meeting of the holders of Senior Preferred Shares duly called for that purpose. The formalities to be observed in
respect of the giving of notice of any such meeting or any adjourned meeting and the conduct hereof shall be those from time to time prescribed by
the Business Corpora- tions Act (Ontario) (as from time to time amended, varied or replaced) and the by-laws of the Corporations with respect to meet-
ings of shareholders. On every poll taken at a meeting of holders of Senior Preferred Shares as a class, or at a joint meeting of
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 4 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
the holders of two or more series of Senior Preferred Shares, each holder of Senior Preferred Shares entitled to vote thereat shall have 1 vote in
respect of each Senior Preferred Share held by him/her.
SERIES A SENIOR PREFERRED SHARES
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Series A Senior Preferred shares (the “Series A
Preferred Shares”) in the capital of the Corporation. Capitalized terms not defined in Sections (1) through (17) are defined in Section (18) hereof.
Designation and Amount. There shall be a series of Senior Preferred Shares of the Corporation designated as the “Series A Senior Preferred Shares”
and the number of shares constituting such series shall be four hundred eighty five million (485,000,000) shares (each a “Series A Preferred Share”).
Ranking. The Series A Preferred Shares shall rank, with respect to rights as to dividends, distributions, redemptions and pay- ments upon the
liquidation, dissolution and winding up of the Corporation (a) senior to all of the Junior Preferred Shares, Com- mon Shares and any other class or
series of capital shares of the Corporation, hereafter issued or authorized, the terms of which do not expressly provide that such class or series ranks
senior to or on a parity with the Series A Preferred Shares as to di- vidends, distributions, redemptions and payments upon the liquidation, dissolution
and winding up of the Corporation (such shares being referred to hereinafter collectively as “Junior Shares”), (b) on a parity basis with each other class
or series of capital shares hereafter issued or authorized, the terms of which expressly provide that such class or series ranks on a parity basis with
the Series A Preferred Shares as to dividends, distributions, redemptions and payments upon the liquidation, dissolution and winding up of the
Corporation (such shares being referred to hereinafter collectively as “Pari Passu Shares”), and (c) on a junior basis with each other class or series of
capital shares hereafter issued or authorized, the terms of which expressly provide that such class or series ranks on a senior basis to the Series A
Preferred Shares as to dividends, distributions, redemptions and pay- ments upon the liquidation, dissolution and winding up of the Corporation (such
shares being referred to hereinafter collectively as “Senior Shares”). Notwithstanding anything to the contrary in these Articles of Continuance (these
“Articles of
Continuance”), the Corporation shall have the right to create and issue Series A-1 Preferred Shares and Series A-2 Preferred
Shares (each as defined below) pursuant to Section (10) without the consent of the Holders.
No Maturity or Sinking Fund. The Series A Preferred Shares shall have no stated maturity and will not be subject to any sinking fund.
Liquidation. In the event of a Liquidation Event, holders of Series A Preferred Shares (each, a “Holder” and collectively, the “Hold- ers”) shall be entitled
to receive in cash out of the assets of the Corporation legally available therefor, whether from capital or from earnings available for distribution to its
shareholders (the “Liquidation Funds”) upon such Liquidation Event, before any
amount shall be paid to the holders of Junior Shares, but subject to the rights of Senior Shares and Pari Passu Shares, an amount per Series A
Preferred Share equal to the greater of (i) the Conversion Amount per Series A Preferred Share and accrued and un- paid Dividends thereon, if any
(and any accrued and unpaid dividends thereon accrued pursuant to Section (5)(c) and (ii) the amount that would have been received had such Series
A Preferred Shares and accrued and unpaid Dividends thereon, if any (and any accrued and unpaid dividends thereon accrued pursuant to Section (5)
(c)) been converted immediately prior to such Li- quidation Event at the then effective Conversion Rate (without regard to any limitations on
conversion); provided that, if the Li- quidation Funds are insufficient to pay the full amount due to the Holders and holders of shares of Pari Passu
Shares, if any, then each Holder and each holder of any such Pari Passu Shares shall receive a percentage of the Liquidation Funds equal to the full
amount of Liquidation Funds that would be payable to such Holder or holder of Pari Passu Shares as a liquidation preference in accordance with their
respective rights set out in the Articles from time to time, as a percentage of the full amount of Liquidation Funds that would be payable to all Holders
and holders of Pari Passu Shares in accordance with their respective rights set out in the Articles from time to time.
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 5 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Exhibit 3.1
Dividends.
Preferential Dividends.
From and after the Issuance Date, the Holders of record as they appear on the books of the
Corporation on February 15, May 15, August 15 and November 15 of each cal- endar year following
the Issuance Date (each such date, a “Preferential Dividend Re-
cord Date”) shall be entitled to receive, to the fullest extent permitted by law and out
of funds lawfully available therefor, before any dividends shall be declared, set apart for or paid upon
the Common Shares or any other Junior Shares, dividends per Series A Preferred Share on the
applicable Preferential Dividend Date (as defined below) in arrears for the previous Calendar Quarter
equal to an amount calculated at 5.50% per annum (the “Preferential Dividend Rate”) on the Issue
Price of each such Series A Preferred Share computed on the basis of a 360-day year and twelve 30-
day months (the “Preferential Dividends”). For the avoidance of doubt, the first Preferential Di- vidends
to be paid by the Corporation on March 15, 2023 shall be prorated for the period starting on the
Issuance Date through such Preferential Dividend Date.
Preferential Dividends shall be payable on March 15, June 15, September 15 and December 15 of
each calendar year following the Issuance Date, or, if any such date falls on a day that is not a
Business Day, the next day that is a Business Day (each such date, a “Preferential Dividend Date”).
Preferential Dividends shall be payable on each Preferential Dividend Date, to the Holders of record
on the related Preferential Dividend Record Date, in whole or in part, in cash (“Cash Preferential
Dividend”) or, so long as there is no Equity Condi- tions Failure in respect of the Preferential Dividend
Shares occurring on the applicable Preferential Dividend Date (subject to waiver of any such Equity
Conditions Failure in accordance with clause (v) below) by any Holder with respect to such Holder
only, in Common Shares (the “Preferential Dividend Shares”), at the Corporation’s election, subject to
any required stock exchange approval to issue such Common Shares.
The Corporation shall give written notice (a “Preferential Dividend Election Notice”)
to each Holder on or prior to the fifteenth (15th) Trading Day immediately prior to the applicable
Preferential Dividend Date (the date such notice is delivered to the Hold- ers, the “Preferential
Dividend Notice Date”) indicating whether it elects to pay Pref- erential Dividend on any Preferential
Dividend Date in Cash Preferential Dividend, in Preferential Dividend Shares or a combination
thereof (and if a combination, the pro- portion that will be paid in Cash Preferential Dividend), which
election shall be the same for all Holders. If the Corporation does not give a Preferential Election
Notice in respect of a Preferential Dividend Date in accordance with the immediately preceding
sentence, the Corporation will be deemed to have elected Cash Preferential Dividend in respect of
the Preferential Dividends due on such Preferential Dividend Date.
If the Corporation elects the payment of applicable Preferential Dividend in Preferen- tial Dividend
Shares, in whole or in part, in respect of a Preferential Dividend Date, and an Equity Conditions
Failure occurs at any time prior to such Preferential Di- vidend Date that the Corporation expects will
last through such Preferential Dividend Date (which is not waived in writing by such Holder), the
Corporation shall provide
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 6 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
each Holder a written notice to that effect by no later than the Trading Day immedi- ately following the
date upon which the Corporation has knowledge of such Equity Conditions Failure, indicating that unless
such Holder waives the Equity Conditions Failure in writing, the applicable portion of Preferential
Dividend as to which such Holder did not waive the Equity Conditions Failure shall be paid as Cash
Preferential Dividend.
If any portion of Preferential Dividend for a particular Preferential Dividend Date shall be paid in
Preferential Dividend Shares, then on the applicable Preferential Dividend Date, the Corporation shall
issue to the Holder, such number of Common Shares equal to (a) the amount of Preferential Dividend
payable on the applicable Preferen- tial Dividend Date in Preferential Dividend Shares divided by (b)
97% of the simple av- erage of the daily Weighted Average Prices of the Common Shares on each
Trading Day during the ten (10) consecutive Trading Days immediately following the applic- able
Preferential Dividend Notice Date. Notwithstanding anything herein to the con- trary, if the price set forth
in clause (b) of the immediately preceding sentence is less than US$59.722 (as adjusted for any share
dividend, share split, share combination, reclassification or similar transaction relating to the Common
Shares occurring after the Subscription Date) or less than the minimum price required such that the
Com- mon Shares are deemed to be issued at or above the market price or otherwise not requiring
shareholder approval by the Toronto Stock Exchange (or its successor), then the Corporation shall be
required to pay the applicable Preferential Dividends on the applicable Preferential Dividend Payment
Date in cash as a Cash Preferential Di- vidend. All Preferential Dividend Shares shall be fully paid and
nonassessable Com- mon Shares (rounded in accordance with Section (6)(b)). By written notice to all
Hold- ers, the Corporation may irrevocably elect to eliminate its ability to pay Preferential Dividends with
Preferential Dividend Shares (i) unless and until it receives the ap- proval of its shareholders for the
issuance of Common Shares in excess of the Ex- change Cap (as defined below) or (ii) subject to no
conditions.
Participating Dividends. From and after the Issuance Date, the Holders on the record date fixed for holders of
Common Shares for dividends or distributions in a Calendar Quarter (or, in the event no such date is fixed in such
Calendar Quarter, on the Preferential Dividend Record Date occurring in such Calendar Quarter) shall be entitled
to receive, to the fullest extent permitted by law and out of funds lawfully available therefor, concurrently with the
payment of regular quarterly cash dividends (or, in the event no such regular quarterly cash dividends are made,
on the Preferential Dividend Date) paid to the holders of Common Shares, the greater of (A) such regular quarterly
cash dividends paid to the holders of Common Shares to the same ex- tent as if such Holders had converted the
Series A Preferred Shares into Common Shares (without regard to any limitations on conversion) and had held
such Common Shares on such record date (or, in the event no such date is fixed in such Calendar Quarter, on the
Preferential Dividend Record Date occurring in such Calendar Quarter) and (B) US$0.27 (as adjusted for any
share dividend, share split, share combination, reclassification or similar transaction relating to the Common
Shares occurring after the Subscription Date) per Common Share issuable upon conversion of the Series A
Preferred Shares pursuant to Section (6)(a) on the applicable record date for payment of such dividend (or, in the
event no such date is fixed in such Calendar Quarter, on the Preferential Dividend Record Date occurring in such
Calendar Quarter)
(without regard to any limitations on conversion) (the “Participating Dividends” and together
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 7 of 50
Exhibit 3.1
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
with the Preferential Dividends, the “Dividends”). For the avoidance of doubt, Holders shall be entitled to receive to
the fullest extent permitted by law and out of funds lawfully available therefor the Participating Dividend set forth in
Section (5)(b)(B) each Calendar Quarter regard- less of whether a regular quarterly cash dividend is declared on
the Common Shares. Notwith- standing anything to the contrary set forth in this Section (5)(b), in no event shall
the Participat- ing Dividend include any special cash dividend payable to the holders of Common Shares, in-
cluding the special cash dividend, if any, to be declared and paid in connection with the trans- actions
contemplated by the Merger Agreement (the “IAA Special
Dividend”); provided, however, for the avoidance of doubt, that special cash dividends, includ-
ing, without limitation, the IAA Special Dividend, shall adjust the Conversion Rate in accordance with Section (7)(a)
(iii).
General. The Dividends shall be paid by the Corporation to the fullest extent permitted by ap- plicable law and out
of funds lawfully available therefor. Dividends on the Series A Preferred Shares shall commence accruing on the
Issuance Date, shall be cumulative and shall continue to accrue without interest whether or not declared and
whether or not in any fiscal year there shall be net profits or surplus available for the payment of Dividends in such
fiscal year, so that if in any fiscal year or years, Dividends in whole or in part are not paid upon the Series A Pre-
ferred Shares as required by this Section (5) for any reason, including, without limitation, be- cause there are no
funds legally available therefor, unpaid Dividends shall accumulate thereon. If the Corporation fails to declare and
pay full Preferential Dividends on the Series A Preferred Shares on any Preferential Dividend Date as provided in
this Section (5), then any Preferential Dividends payable on such Preferential Dividend Date on the Series A
Preferred Shares but not paid shall accrue an additional dividend thereon at a rate equal to the Preferential
Dividend Rate, computed on the basis of a 360-day year and twelve 30-day months, from and including the
applicable Preferential Dividend Date to but excluding the day on which the Corporation shall have paid in
accordance with this Section (5) all Dividends on which the Series A Preferred Shares that are then in arrears or
until the conversion, redemption or repurchase of the applic- able Series A Preferred Shares. The Corporation
shall not (either directly or through any of its Subsidiaries) redeem or repurchase any Pari Passu Shares or Junior
Shares, unless the Corpor- ation has declared all Dividends on the Series A Preferred Shares that have accrued
through the Preferential Dividend Record Date immediately preceding the date of such redemption or repurchase
and paid all Dividends on the Series A Preferred Shares that are payable through the Preferential Dividend Date
immediately preceding the date of such redemption or repur- chase other than redemptions or repurchases of (i)
Series A Preferred Shares, Series A-1 Pre- ferred Shares or Series A-2 Preferred Shares, as applicable, (ii) Junior
Shares in the ordinary course of business in connection with any employment contract, equity incentive plan,
benefit plan or other similar arrangement with or for the benefit of current or former employees, of- ficers, directors
or consultants; provided that not more than US$10.0 million is paid by the Cor- poration to redeem or repurchase
Junior Shares in accordance with this clause (ii) in any 12 consecutive month period; (iii) Pari Passu Shares or
Junior Shares as a result of an exchange or conversion of any class or series of Pari Passu Shares or Junior
Shares for any other class or series of Pari Passu Shares (in the case of Pari Passu Shares) or Junior Shares (in
the case of Pari Passu Shares or Junior Shares); and (iv) fractional interests in Pari Passu Shares or Junior
Shares pursuant to the conversion or exchange provisions of such Pari Passu Shares or Junior Shares or the
security being converted or exchanged.
Conversion of Series A Preferred Shares into Common Shares. Series A Preferred Shares shall be convertible into Common
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 8 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Shares on the terms and conditions set forth in this Section (6).
Holder’s Conversion Right. Subject to the provisions of Section (6)(e), at any time or times on or after the Issuance
Date, any Holder shall be entitled to convert any Series A Preferred Shares into fully paid and nonassessable
Common Shares in accordance with this Section (6) at the Conversion Rate (as defined below).
Conversion. The number of Common Shares issuable upon conversion by a Holder of Series A Preferred Shares
pursuant to Section (6)(a) shall be determined by multiplying (x) the Conver- sion Amount in respect of the Series
A Preferred Shares converted by such Holder pursuant to Section (6)(a), by (y) the Conversion Rate. In addition,
the Corporation will deliver, to the fullest extent permitted by law and out of funds lawfully available therefor, cash
in respect of accrued and unpaid Dividends, if any (and any accrued and unpaid dividends accrued pursuant to
Section (5)(c)), with respect to such Series A Preferred Shares converted by such Holder pur- suant to Section (6)
(a). In connection with any conversion request, a Holder must convert at least 1,000 Series A Preferred Shares
(unless it holds fewer than 1,000 Series A Preferred Shares at the time of such request, in which case, it must
convert such number of Series A Pre- ferred Shares held). No fractional Common Shares are to be issued upon
the conversion of any Series A Preferred Share, but rather the number of Common Shares to be issued shall be
roun- ded down to the nearest whole number and the Corporation shall in lieu of delivering any frac- tional
Common Share issuable upon conversion, to the fullest extent permitted by law and out of funds lawfully available
therefor, make a cash payment (calculated to the nearest cent) equal to such fraction multiplied by the Closing
Sale Price of the Common Shares on the relevant Conversion Date without interest. The applicable Conversion
Rate is subject to adjustment as hereinafter provided.
Mechanics of Conversion. The conversion of Series A Preferred Shares shall be conducted in the following
manner:
Holder’s Delivery Requirements. To convert Series A Preferred Shares into Common Shares on any
date, a Holder shall (A) deliver to the Corporation for receipt on or prior to 5:30 p.m., New York City Time,
on such date, a copy of a properly completed and duly executed notice of conversion executed by the
registered Holder of the Series A Preferred Shares subject to such conversion in the form attached
hereto as Ex- hibit 1 (a “Conversion Notice”); and (B) deliver to the Corporation funds for the pay- ment of
any applicable share transfer, documentary, stamp or similar taxes.
Corporation’s Response. As soon as practicable after the applicable Conversion Date, but in any event
within two (2) Trading Days, the Corporation shall (A) (x) provided the Transfer Agent is participating in
the Depository Trust Company (“DTC”) Fast Auto-
mated Securities Transfer Program (“FAST Program”) and the Common Shares issu-
able upon such conversion are DTC eligible and are issuable without a restricted le- gend and with an
unrestricted CUSIP, as reasonably determined by the Corporation, credit such aggregate number of
Common Shares to which such Holder shall be en- titled to such Holder’s or its designee’s balance
account with DTC through its De- posit/Withdrawal at Custodian system, or (y) if the Transfer Agent is
not participating in the DTC FAST Program or the Common Shares issuable upon such conversion are
not DTC eligible or are not issuable without a restricted legend and with an unrestric- ted CUSIP, as
reasonably determined by the Corporation, make a book-entry notation
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 9 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
registered in the name of such Holder or its designee, for the number of Common Shares to which such
Holder shall be entitled and deliver to the address as specified in the applicable Conversion Notice any
notice required by law and (B) deliver, to the fullest extent permitted by law and out of funds lawfully
available therefor, cash in re- spect of accrued and unpaid Dividends, if any (and any accrued and
unpaid dividends accrued pursuant to Section (5)(c)), with respect to such Series A Preferred Shares
converted by such Holder pursuant to Section (6)(a). While any Series A Preferred Shares are
outstanding, the Corporation shall use a transfer agent that participates in the FAST Program or any
successor program.
Record Holder. To the fullest extent permitted by law, the Person or Persons entitled to receive the
Common Shares issuable upon a conversion of Series A Preferred Shares shall be treated for all
purposes as the record holder or holders of such Com- mon Shares on the applicable Conversion Date
or Mandatory Conversion Date (as defined below), as applicable, irrespective of the date such Common
Shares are cred- ited to such Holder’s account with DTC or the date of the book-entry notations eviden-
cing such Common Shares, as the case may be.
Corporation’s Failure to Timely Convert. If a Holder has not received all of the Com- mon Shares to
which such Holder is entitled on or within two (2) Trading Days after the applicable share delivery date
with respect to a conversion of Series A Preferred Shares for any reason other such Holder’s failure to
comply with the conditions set forth herein, then such Holder, upon written notice to the Corporation, may
void its Conversion Notice with respect to, and retain or have returned, as the case may be, any Series A
Preferred Shares that have not been converted pursuant to such Holder’s Conversion Notice.
Mandatory Conversion at the Corporation’s Election. If at any time, or from time to time, during the applicable
Mandatory Conversion Period (i) the applicable Mandatory Conversion Price Condition is satisfied and (ii) no
Equity Conditions Failure exists on the Mandatory Conversion Date, the Corporation shall from time to time have
the right to require the Holders to convert all, or any portion, of the outstanding Series A Preferred Shares, as
designated in the Mandat- ory Conversion Notice (as defined below) relating to the applicable Mandatory
Conversion on the applicable Mandatory Conversion Date into fully paid, validly issued and nonassessable
Common Shares and the Corporation will deliver, to the fullest extent permitted by law and out of funds lawfully
available therefor, cash in respect of accrued and unpaid Dividends, if any (and any accrued and unpaid dividends
accrued pursuant to Section (5)(c)), with respect to such Series A Preferred Shares converted by the Corporation
pursuant to this Section (6)(d) (a
“Mandatory Conversion”). The number of Common Shares issuable to a Holder in connection
with a Mandatory Conversion pursuant to this Section (6)(d) shall be determined by multiply- ing (x) the
Conversion Amount in respect of the Series A Preferred Shares of such Holder con- verted by the Corporation
pursuant to this Section (6)(d) by (y) the Conversion Rate as of the applicable Mandatory Conversion Date. No
fractional Common Shares are to be issued upon the Mandatory Conversion of any Series A Preferred Share, but
rather the number of Common Shares to be issued shall be rounded down to the nearest whole number and the
Corporation shall in lieu of delivering any fractional Common Share issuable upon conversion make, to the fullest
extent permitted by law and out of funds lawfully available therefor, a cash payment (calculated to the nearest
cent) equal to such fraction multiplied by the Closing Sale Price of the
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 10 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Common Shares on the relevant Mandatory Conversion Date without interest. The Corporation may exercise its
right to require conversion under this Section (6)(d) by delivering not more than one (1) Trading Day following the
end of any such Mandatory Conversion Measuring Period a written notice thereof to all Holders (a “Mandatory
Conversion Notice” and the date the Corporation delivers such notice to all Holders is referred to as a “Mandatory
Conversion
Notice Date”). Each Mandatory Conversion Notice shall be irrevocable. Each Mandatory Con-
version Notice shall (i) state (a) the Trading Day on which the applicable Mandatory Conversion shall occur, which
Trading Day shall be the twentieth (20th) Trading Day following the applic- able Mandatory Conversion Notice
Date (unless an earlier date is agreed to in writing between the Corporation and a Holder, but only with respect to
such Holder) (a “Mandatory Conver-
sion Date”), (b) the aggregate Conversion Amount of the Series A Preferred Shares which the
Corporation has elected to be subject to such Mandatory Conversion from such Holder and all other Holders
pursuant to this Section (6)(d), (c) the amount of accrued and unpaid Dividends, if any (and any accrued and
unpaid dividends accrued pursuant to Section (5)(c)), with respect to such Series A Preferred Shares converted by
the Corporation pursuant to this Section (6)(d), (d) the number of Common Shares to be issued to such Holder on
the ap- plicable Mandatory Conversion Date, (e) in the event such Mandatory Conversion cannot be
consummated in full due to the limitations set forth in Section (6)(e), state whether the Corpor- ation shall on the
applicable Mandatory Conversion Date, to the fullest extent permitted by law and out of funds lawfully available
therefor, redeem the Series A Preferred Shares that cannot be converted due to such limitation (such Series A
Preferred Shares that the Corporation has elected to be subject to a Mandatory Conversion but which cannot be
so converted due to the
limitations set forth in Section (6)(e), the “Excess Mandatory Conversion Shares”) and (f) state
whether the conversion of all or any portion of the Series A Preferred Shares that the Corpora- tion has elected to
be subject to a Mandatory Conversion will result in the issuance of a greater number of Common Shares than
permitted under Section (6)(e)(i), and (ii) certify that the ap- plicable Mandatory Conversion Price Condition
relating to the applicable Mandatory Conver- sion has been satisfied and that there is no Equity Conditions Failure
as of the Mandatory Con- version Notice Date. If the Corporation confirmed that there was no such Equity
Conditions Failure relating to the applicable Mandatory Conversion as of the applicable Mandatory Con- version
Notice Date but an Equity Conditions Failure occurs at any time between the applicable
Mandatory Conversion Notice Date and the applicable Mandatory Conversion Date (a “Man-
datory Conversion Interim Period”) that the Corporation expects will last through the applic- able Mandatory
Conversion Date, the Corporation shall provide each Holder a subsequent written notice to that effect. If there is
an Equity Conditions Failure on the applicable Mandat- ory Conversion Date, then such Mandatory Conversion
shall be null and void with respect to all or any part designated by such Holder of the unconverted Series A
Preferred Shares subject to the applicable Mandatory Conversion and such Holder shall be entitled to all the rights
of a holder of Series A Preferred Shares with respect to such Series A Preferred Shares; provided, however, that if
a Holder waives in writing an Equity Conditions Failure dur- ing the applicable Mandatory Conversion Interim
Period, then the Corporation shall be re- quired to proceed with the applicable Mandatory Conversion with respect
to such Holder. Not- withstanding anything to the contrary in this Section (6)(d), until the applicable Mandatory
Con- version has occurred, the Series A Preferred Shares subject to the Mandatory Conversion may be converted,
in whole or in part, by a Holder into Common Shares pursuant to Sections (6)(a)-
(c). All Series A Preferred Shares converted by a Holder after a Mandatory Conversion Notice
Date shall reduce the Series A Preferred Shares required to be converted on the related Man-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 11 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
datory Conversion Date. If a Mandatory Conversion cannot be consummated in full due to the limitations set forth
in Section (6)(e), then (i) on the applicable Mandatory Conversation Date, only that portion of the applicable
Mandatory Conversion that complies with the limitations set forth in Section (6)(e) shall occur, (ii) unless the
Corporation has indicated in the applicable Mandatory Conversion Notice that it shall redeem the applicable
Excess Mandatory Conversion Shares on the applicable Mandatory Conversion Date, such Holder must promptly
deliver one or more Conversion Notice(s) to the Corporation upon disposition of any securities of the Cor- poration
that would permit the conversion of any portion of such Excess Mandatory Conver- sion Shares and (iii)
notwithstanding anything herein to the contrary, Preferential Dividends with respect to the Series A Preferred
Shares which the Corporation has elected to be subject to such Mandatory Conversion shall cease to accrue and
be payable as of the applicable Man- datory Conversion Date and all approval, consent or voting rights and any
right to a Make- Whole Amount shall cease with respect to the Series A Preferred Shares not able to be so con-
verted. If a Mandatory Conversion consummated in full would violate the limitations set forth in (i) Section (6)(e)(ii),
the Corporation may indicate in the related Mandatory Conversion Notice that it shall redeem, to the fullest extent
permitted by law and out of funds lawfully available therefor, the Excess Mandatory Conversion Shares on the
applicable Mandatory Conversion Date in cash, without interest, at a price equal to the greater of (x) 100% of the
Conversion Amount in respect of the applicable Excess Mandatory Conversion Shares and (y) the product of (1)
the Conversion Amount of the applicable Excess Mandatory Conversion Shares and (2) the quotient determined
by dividing (A) the greatest Closing Sale Price of the Common Shares during the period beginning on the Trading
Day immediately preceding the applicable Mandat- ory Conversion Notice Date and ending on the Trading Day
immediately preceding the applic- able Mandatory Conversion Date, by (B) the lowest Conversion Price in effect
during such period referred to in the immediately preceding clause (y)(2)(A) or (ii) Section (6)(e)(i), the Cor-
poration may indicate in the related Mandatory Conversion Notice that it shall redeem the por- tion of the Series A
Preferred Shares that is subject to a Mandatory Conversion that cannot be converted due to the limitations set
forth in Section (6)(e)(i) on the applicable Mandatory Con- version Date in cash, without interest, at a price per
Common Share that the Corporation is prohibited from issuing pursuant to Section (6)(e)(i) equal to the amount
set forth in the last sentence of Section (6)(e)(i). If the Corporation elects to cause a Mandatory Conversion pursu-
ant to this Section (6)(d), then it must simultaneously take the same action in the same propor- tion with respect to
all Series A Preferred Shares to the extent practicable or, if the pro rata basis is not practicable for any reason, by
lot or such other equitable method as the Corpora- tion determines in good faith. On the Mandatory Conversion
Date, each Series A Preferred Share to be converted pursuant to such Mandatory Conversion shall automatically
be conver- ted into fully paid, validly issued, nonassessable Common Shares as described above without any
further act or deed on the part of the Corporation, any Holder or any other Person.
Limitation on Conversions.
Principal Market Regulation. The Corporation shall not be obligated to issue any Com- mon Shares
pursuant to the terms of these Articles of Continuance, and the Holders shall not have the right to receive
any Common Shares pursuant to the terms of these Articles of Continuance, to the extent the issuance
of such Common Shares would ex- ceed 22,165,789 Common Shares (as adjusted for any share
dividend, share split, share combination, reclassification or similar transaction relating to the Common
Shares occurring after the Subscription Date) (the “Exchange Cap”), except that such
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 12 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
limitation shall not apply in the event that the Corporation obtains the approval of its shareholders as
required by the applicable rules of the Principal Market and the Toronto Stock Exchange (or its
successor), as applicable, for issuances of Common Shares in excess of such amount or if the Principal
Market and the Toronto Stock Ex- change (or its successor), as applicable, allows for a greater number
of Common Shares to be issued pursuant to these Articles of Continuance. Until such approval is
obtained, no Holder shall be issued in the aggregate, pursuant to the terms of these Articles of
Continuance, Common Shares in an amount greater than the product of the Exchange Cap multiplied by
a fraction, the numerator of which is the number of Series A Preferred Shares issued to such initial
Holder pursuant to the Securities Pur- chase Agreement on the Issuance Date and the denominator of
which is the aggreg- ate number of all Series A Preferred Shares issued to the initial Holders pursuant to
the Securities Purchase Agreement on the Issuance Date (with respect to each such
Holder, the “Exchange Cap Allocation”). In the event that any Holder shall sell or oth-
erwise transfer any of such Holder’s Series A Preferred Shares, the transferee shall be allocated a pro
rata portion of such Holder’s Exchange Cap Allocation, and the restric- tions of the prior sentence shall
apply to such transferee with respect to the portion of the Exchange Cap Allocation allocated to such
transferee. In the event that any Holder shall have converted any of such Holder’s Series A Preferred
Shares into a number of Common Shares which, in the aggregate, is less than such Holder’s Ex- change
Cap Allocation, then the difference between such Holder’s Exchange Cap Al- location and the number of
Common Shares actually issued to such Holder shall be allocated to the respective Exchange Cap
Allocations of the remaining Holders on a pro rata basis in proportion to the Common Shares underlying
the Series A Preferred Shares then held by each such Holder. In the event that the Corporation is
prohibited from issuing any Common Shares in connection with a conversion of Series A Pre- ferred
Shares pursuant to Section (6)(a) or Section (6)(d)or in respect of Preferential
Dividend Shares as a result of the operation of this Section (6)(e)(i) (the “Exchange
Cap Shares”), the Corporation shall, to the fullest extent permitted by law and out of funds lawfully
available therefor, pay cash on or prior to the applicable share delivery date to such Holder in exchange
for the redemption of such number of Series A Pre- ferred Shares held by the Holder that are not
convertible into such Exchange Cap Shares at a price equal to the product of (x) such number of
Exchange Cap Shares and (y) the Closing Sale Price of the Common Shares on the applicable
Conversion Date or Mandatory Conversion Date, as the case may be, except that if the Exchange Cap
Shares are Preferential Dividend Shares, the Corporation shall instead pay to such Holder Cash
Preferential Dividends on the applicable Preferential Dividend Date in accordance with Section (5).
HSR Cap. Notwithstanding anything to the contrary contained herein, until the HSR Date the Corporation
shall not effect the conversion of any portion of Series A Pre- ferred Shares held by an HSR Holder in
excess of the HSR Amount, and no HSR Holder shall have the right to convert any portion of its Series A
Preferred Shares in excess of the HSR Amount pursuant to the terms and conditions of these Articles of
Continu- ance and any such conversion shall be null and void and treated as if never made.
Transfer Taxes. The Corporation shall not be required to pay any documentary stamp or sim- ilar tax that may be
payable in respect of the issuance, delivery, payment or other transfer of
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 13 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Exhibit 3.1
Adjustments to Conversion Rate.
Series A Preferred Shares, Common Shares or other securities, and shall not be required to make any such
issuance, delivery, payment or other transfer unless and until the Person en- titled to such issuance, delivery,
payment or other transfer or any other Person liable for such tax has paid to the Corporation the amount of any
such tax or has established, to the reason- able satisfaction of the Corporation (as determined in its
reasonable discretion), that such tax has been paid or is not payable.
Adjustments. The Conversion Rate will be subject to adjustment, without duplication, upon the occurrence of
the following events, except that the Corporation shall not make any adjustment to the Conversion Rate if each
Holder of the Series A Preferred Shares participates, at the same time and upon the same terms as holders of
Common Shares and solely as a result of holding Series A Preferred Shares, in any transaction described in
this Section (7)(a), without having to convert its Series A Preferred Shares, as if it held a number of Common
Shares equal to (x) the Conversion Rate, multiplied by (y) the Conversion Amount of Series A Preferred Shares
held by such Holder (without regard to any limitations on conversion):
The exclusive issuance of Common Shares as a dividend or distribution on all or sub- stantially all of
the Common Shares, or a subdivision or combination of Common Shares or a reclassification of
Common Shares into a greater or lesser number of Common Shares, in which event the Conversion
Rate shall be adjusted based on the following formula:
CR1 = CR0 x (OS1 / OS0)
CR0 = the Conversion Rate in effect immediately prior to the open of business on (i) the Ex-Dividend
Date for such dividend or distribution, or (ii) the effective date of such subdivision, combination or
reclassification
CR1 = the new Conversion Rate in effect immediately after the open of business on (i) the Ex-
Dividend Date for such dividend or distribution, or (ii) the effective date of such subdivision,
combination or reclassification
OS0 = the number of Common Shares outstanding immediately prior to the open of business on (i)
the Ex-Dividend Date for such dividend or distribution or (ii) the effect- ive date of such subdivision,
combination or reclassification
OS1 = the number of Common Shares outstanding immediately after, and solely as a result of, the
completion of such event
Any adjustment made pursuant to this clause (i) shall be effective immediately after the open of
business on the Ex-Dividend Date for such dividend or distribution, or the effective date of such
subdivision, combination or reclassification, as applicable. If any such event is announced or
declared but does not occur, the Conversion Rate shall be readjusted, effective as of the date the
Corporation announces that such event shall not occur, to the Conversion Rate that would then be in
effect if such event had not been declared.
The dividend, distribution or other issuance to all or substantially all holders of Com-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 14 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
mon Shares of rights (other than rights, options or warrants distributed in connection with a shareholder
rights plan (in which event the provisions of Section (7)(a)(vi) shall apply)), options or warrants entitling
them to subscribe for or purchase Common Shares for a period expiring forty-five (45) days or less from
the date of issuance thereof, at a price per share that is less than the Current Market Price as of the date
such dividend, distribution or other issuance is publicly announced (the “Public An-
nouncement Date”) for such issuance, in which event the Conversion Rate will be in-
creased based on the following formula: CR1 = CR0 x
[(OS0+X) / (OS0+Y)]
CR0 = the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date
for such dividend, distribution or issuance
CR1 = the new Conversion Rate in effect immediately following the open of business on the Ex-Dividend
Date for such dividend, distribution or issuance
OS0 = the number of Common Shares outstanding immediately prior to the open of business on the Ex-
Dividend Date for such dividend, distribution or issuance
X = the total number of Common Shares issuable pursuant to such rights, options or warrants
Y = the number of Common Shares equal to the aggregate price payable to exercise such rights, options
or warrants divided by the Current Market Price as of the Public Announcement Date for such dividend,
distribution or issuance
For purposes of this clause (ii), in determining whether any rights, options or warrants entitle the holders
to purchase the Common Shares at a price per share that is less than the Current Market Price as of the
Public Announcement Date for such dividend, distribution or issuance, there shall be taken into account
any consideration the Cor- poration receives for such rights, options or warrants, and any amount payable
on ex- ercise thereof, with the value of such consideration, if other than cash, to be the Fair Market Value
thereof.
Any adjustment made pursuant to this clause (ii) shall become effective immediately following the open of
business on the Ex-Dividend Date for such dividend, distribution or issuance. In the event that such rights,
options or warrants are not so issued, the Conversion Rate shall be readjusted, effective as of the date
the Corporation publicly announces its decision not to issue such rights, options or warrants, to the
Conversion Rate that would then be in effect if such dividend, distribution or issuance had not been
declared. To the extent that such rights, options or warrants are not exercised prior to their expiration or
Common Shares are otherwise not delivered pursuant to such rights, options or warrants upon the
exercise of such rights, options or warrants, the Conversion Rate shall be readjusted to the Conversion
Rate that would then be in effect had the adjustments made upon the dividend, distribution or issuance of
such rights, options or warrants been made on the basis of the delivery of only the number of Common
Shares actually delivered.
The distribution by the Corporation to all or substantially all holders of its Common
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 15 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Shares (other than for cash in lieu of fractional shares), shares of any class of its share capital,
evidences of its indebtedness, assets, other property, securities or special cash dividends (including,
without limitation, the IAA Special Dividend, but exclud- ing (A) regular quarterly cash dividends that are
Participating Dividends in accordance with Section (5)(b)), (B) dividends or distributions referred to in
Section (7)(a)(i) or Sec- tion (7)(a)(ii) hereof, (C) Distribution Transactions as to which Section (7)(a)(iv)
shall ap- ply, (D) rights, options or warrants distributed in connection with a shareholder rights plan as to
which Section (7)(a)(v) shall apply and (E) distributions of Reference Prop- erty in a Corporate Event
described in Section (9)(c) hereof) (any of such shares of its share capital, indebtedness, assets,
property, securities or special cash dividends that
are not so excluded are hereinafter called the “Distributed Property”), then, in each
such case the Conversion Rate shall be adjusted based on the following formula: CR1 = CR0 x
[SP0 / (SP0 - FMV)]
CR0 = the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date
for such dividend or distribution
CR1 = the new Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date
for such dividend or distribution
SP0 = the Current Market Price as of the Ex-Dividend Date for such dividend or distri- bution
FMV = the Fair Market Value of the portion of Distributed Property distributed with re- spect to each
outstanding Common Share on the Ex-Dividend Date for such dividend or distribution; provided that in the
event of a dividend or distribution of cash, FMV shall equal the amount in cash per Common Share the
Corporation distributes to all or substantially all holders of its Common Shares; provided further that, if
FMV is equal or greater than SP0, then in lieu of the foregoing adjustment, the Corporation shall dis-
tribute to each Holder of Series A Preferred Shares on the date the applicable Distrib- uted Property is
distributed to holders of Common Shares, but without requiring such Holder to convert its Series A
Preferred Shares, in respect of each Series A Preferred Share held by such Holder, the amount of
Distributed Property such holder would have received had such holder owned a number of Common
Shares equal to the Con- version Rate on the Ex-Dividend Date for such dividend or distribution
Any adjustment made pursuant to this clause (iii) shall be effective immediately after the open of business
on the Ex-Dividend Date for such dividend or distribution. If any such dividend or distribution is declared
but does not occur, the Conversion Rate shall be readjusted, effective as of the date the Corporation
announces that such dividend or distribution shall not occur, to the Conversion Rate that would then be in
effect if such dividend or distribution had not been declared.
The Corporation effects a Distribution Transaction, in which case the Conversion Rate shall be increased
based on the following formula:
CR1 = CR0 x [(FMV + MP0) / MP0]
CR0 = the Conversion Rate in effect immediately prior to the end of the Valuation
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 16 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Period (as defined below)
CR1 = the new Conversion Rate in effect immediately after the end of the Valuation Period
FMV = the arithmetic average of the Weighted Average Prices for a common share or similar equity
interest distributed per Common Share to holders of Common Shares over the first ten (10) consecutive
Trading Day period after, and including, the Ex-Di- vidend Date for the Distribution Transaction (the
“Valuation Period”); provided that, if there is no Weighted Average Price of the common share or similar
equity interest dis- tributed to holders of the Common Shares on such Ex-Dividend Date, the “Valuation
Period” shall be the ten (10) consecutive Trading Day period after, and including, the first Trading Day
such Weighted Average Price is available
MP0 = the arithmetic average of the Weighted Average Price per Common Share over the Valuation
Period
Such adjustment shall become effective immediately following the close of business on the last Trading Day
of the Valuation Period. If an adjustment to the Conversion Rate is re- quired under this Section (7)(a)(iv),
delivery of any additional Common Shares that may be deliverable upon conversion as a result of an
adjustment required under this Section (7)(a)(iv) shall be delayed to the extent necessary in order to
complete the cal- culations provided for in this Section (7)(a)(iv). If any Distribution Transaction is declared
but not so paid or made, the Conversion Rate shall be immediately decreased, effective as
of the date the Board of Directors of the Corporation (the “Board”) determines not to pay
or make such dividend or distribution, to the Conversion Rate that would then be in effect if such dividend or
distribution had not been declared or announced.
If the Corporation or any of its Subsidiaries make a payment in respect of a tender or exchange offer for
the Common Shares that is subject to the then applicable tender offer rules under the Exchange Act,
other than an odd lot tender offer pursuant to Rule 13e-4(h)(5) under the Exchange Act, to the extent that
the cash and value of any other consideration included in the payment per Common Share exceeds the
average of the Weighted Average Prices of the Common Shares over the ten (10) consecutive Trading
Day period commencing on, and including, the Trading Day next succeeding the last date on which
tenders or exchanges may be made pursuant to such tender or exchange offer, the Conversion Rate
shall be increased based on the following for- mula:
CR1 = CR0 x [AC+(SP1 x OS1)] / (OS0 x SP1)
CR0 = the Conversion Rate in effect immediately prior to the close of business on the 10th Trading Day
immediately following, and including, the Trading Day next succeed- ing the date such tender or exchange
offer expires
CR1 = the Conversion Rate in effect immediately after the close of business on the 10th Trading Day
immediately following, and including, the Trading Day next succeeding the date such tender or exchange
offer expires
AC = the aggregate value of all cash and any other consideration (as determined by the
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 17 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Corporation) paid or payable for Common Shares purchased in such tender or ex- change offer
OS0 = the number of Common Shares outstanding immediately prior to the date such tender or exchange
offer expires (prior to giving effect to the purchase of all Common Shares accepted for purchase or
exchange in such tender or exchange offer)
OS1 = the number of Common Shares outstanding immediately after the date such tender or exchange
offer expires (after giving effect to the purchase of all Common Shares accepted for purchase or
exchange in such tender or exchange offer)
SP1 = the average of the Weighted Average Prices of the Common Shares over the 10 consecutive
Trading Day period commencing on, and including, the Trading Day next succeeding the date such tender
or exchange offer expires
The adjustment to the Conversion Rate under this Section (7)(a)(v) shall occur at the close of business on the
10th Trading Day immediately following, and including, the Trading Day next succeeding the date such tender
or exchange offer expires. If an adjustment to the Conversion Rate is required under this Section (7)(a)(v),
delivery of any additional Com- mon Shares that may be deliverable upon conversion as a result of an
adjustment re- quired under this Section (7)(a)(v) shall be delayed to the extent necessary in order to
complete the calculations provided for in this Section (7)(a)(v). If the Corporation or one of its Subsidiaries is
obligated to purchase Common Shares pursuant to any such tender or exchange offer described in the
preceding paragraph but the Corporation is, or such Sub- sidiary is, permanently prevented by applicable law
from effecting any such purchase or all such purchases are rescinded, the Conversion Rate will be
decreased to be the Conver- sion Rate that would then be in effect if such tender or exchange offer had not
been made or had been made only in respect of the purchases that have been effected.
If the Corporation has a shareholder rights plan in effect with respect to the Common Shares on any
Conversion Date or Mandatory Conversion Date, upon conversion of any of the Series A Preferred
Shares, Holders of such shares will receive, in addition to the applicable number of Common Shares, the
rights under such rights plan relating to such Common Shares, unless, prior to such Conversion Date,
the rights have (A) be- come exercisable or (B) separated from the Common Shares (the first of such
events
to occur, a “Trigger Event”), in which case, the Conversion Rate will be adjusted, ef-
fective automatically at the time of such Trigger Event, as if the Corporation had made a distribution of
such rights to all holders of the Common Shares as described in Sec- tion (7)(a)(ii) (without giving effect
to the forty-five (45) day limit on the exercisability of rights, options or warrants ordinarily subject to such
Section (7)(a)(ii)), subject to ap- propriate readjustment in the event of the expiration, termination or
redemption of such rights prior to the exercise, deemed exercise or exchange thereof. Notwithstand- ing
the foregoing, to the extent any such shareholder rights are exchanged by the Corporation for Common
Shares or other property or securities, the Conversion Rate shall be appropriately readjusted as if such
shareholder rights had not been issued, but the Corporation had instead issued such Common Shares or
other property or se- curities as a dividend or distribution of Common Shares pursuant to Section (7)(a)(i)
or Section (7)(a)(iii), as applicable.
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 18 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
To the extent that such rights are not exercised prior to their expiration, termination or redemption, the
Conversion Rate shall be readjusted to the Conversion Rate that would then be in effect had the
adjustments made upon the occurrence of the Trigger Event been made on the basis of the issuance of,
and the receipt of the exercise price with respect to, only the number of Common Shares actually issued
pursuant to such rights.
Notwithstanding anything to the contrary in this Section (7)(a)(vi), no adjustment shall be required to be
made to the Conversion Rate with respect to any Holder which is, or is an “affiliate” or “associate” of, an
“acquiring person” (or analogous term) under such shareholder rights plan or with respect to any direct or
indirect transferee of such Holder who receives Series A Preferred Shares in such transfer after the time
such Holder becomes, or its affiliate or associate becomes, an “acquiring person” (or ana- logous term).
Calculation of Adjustments. All adjustments to the Conversion Rate shall be calculated by the Corporation to the
nearest 1/10,000,000th of one Common Share (or if there is not a nearest 1/10,000,000th of a share, to the next
lower 1/10,000,000th of a share). No adjustment to the Conversion Rate will be required unless such adjustment
would require an increase or de- crease of at least one percent of the Conversion Rate; provided, however, that
any such adjust- ment that is not required to be made will be carried forward and taken into account in any
subsequent adjustment; provided further that any such adjustment of less than one percent that has not been
made will be made upon any conversion.
When No Adjustment Required.
Except as otherwise provided in this Section (7), the Conversion Rate will not be adjus- ted for the
issuance of Common Shares or any securities convertible into or ex- changeable for Common Shares or
carrying the right to purchase any of the forego- ing, or for the repurchase of Common Shares.
Except as otherwise provided in this Section (7), the Conversion Rate will not be adjus- ted as a result of
the issuance of, the distribution of separate certificates represent- ing, the exercise or redemption of, or
the termination or invalidation of, rights pursu- ant to any shareholder rights plans.
No adjustment to the Conversion Rate will be made:
upon the issuance of any Common Shares pursuant to any present or future plan providing for the
reinvestment of dividends or interest payable on securities of the Corporation and the investment of
additional optional amounts in Common Shares under any plan in which purchases are made at market
prices on the date or dates of purchase, without discount, and whether or not the Corporation bears the
ordinary costs of administration and operation of the plan, including brokerage commissions;
upon the issuance of any Common Shares or options or rights to purchase such shares pursuant to any
present or future employee, director or officer benefit or equity incentive arrangement, plan or program of
or assumed by the Corporation or any of its Subsidiaries or of any employee agreements or
arrangements or programs;
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 19 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
except as otherwise provided in this Section (7) upon the issuance of any Common Shares pursuant to
any option, warrant, right, or exercisable, exchangeable or any shares or securities directly or indirectly
convertible into or exercisable or exchange- able for Common Shares;
for dividends or distributions declared or paid to holders of Common Shares in which Holders participate
pursuant to Section (5);
for a third-party tender offer or exchange offer by any party other than a tender offer or exchange offer by
one or more of the Corporation’s Subsidiaries as described in Section (7)(a)(v); or
for any accrued and unpaid dividends (in accordance with Section (5)(c)) or Dividends.
Successive Adjustments. After an adjustment to the Conversion Rate under this Section (7), any subsequent event
requiring an adjustment under this Section (7) shall cause an adjustment to each such Conversion Rate as so
adjusted.
Multiple Adjustments. For the avoidance of doubt, if an event occurs that would trigger an ad- justment to the
Conversion Rate pursuant to this Section (7) under more than one subsection hereof, such event, to the extent
fully taken into account in a single adjustment, shall not result in multiple adjustments hereunder; provided,
however, that if more than one subsection of this Section (7) is applicable to a single event, the subsection shall be
applied that produces the highest adjusted Conversion Rate.
Notice of Adjustments. Whenever the Conversion Rate is adjusted as provided under this Sec- tion (7), the
Corporation shall as soon as reasonably practicable following the occurrence of an event that requires such
adjustment (or if the Corporation is not aware of such occurrence, as soon as reasonably practicable after
becoming so aware) compute the adjusted applicable Conversion Rate in accordance with this Section (7) and
prepare and transmit to the Holders and if the Transfer Agent maintains the register and records pursuant to
Section (17), the
Transfer Agent a certificate of an authorized officer of the Corporation (an “Officer’s Certific-
ate”) setting forth the applicable Conversion Rate, the method of calculation thereof, and the facts requiring such
adjustment and upon which such adjustment is based.
Transfer Agent. The Transfer Agent shall not at any time be under any duty or responsibility to any Holder to
determine whether any facts exist that may require any adjustment of the Con- version Rate or with respect to the
nature or extent or calculation of any such adjustment when made, or with respect to the method employed in
making the same. The Transfer Agent shall be fully authorized and protected in relying on any Officer’s Certificate
delivered pursuant to Section (7)(f) and any adjustment contained therein and the Transfer Agent shall not be
deemed to have knowledge of any adjustment unless and until it has received such certificate. The Transfer Agent
shall not be responsible for any failure of the Corporation to issue, transfer or deliver any Common Shares
pursuant to the conversion of Series A Preferred Shares or to comply with any of the duties, responsibilities or
covenants of the Corporation contained in this Section (7).
Offer To Repurchase. If, at any time while any Series A Preferred Shares remain outstanding, the Corporation redeems or repur- chases any of its
Common Shares, Junior Shares, options or warrants that are convertible, exchangeable or exercisable for Com- mon Shares after it has redeemed or
repurchased from and after the Subscription Date an aggregate of US$2.0 billion of Com-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 20 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
mon Shares (and/or Common Shares underlying any Junior Shares, options or warrants that are convertible, exchangeable or ex- ercisable for
Common Shares) (an “Offer to Repurchase Event”), the Corporation shall deliver a written notice thereof (an “Of- fer to Repurchase Notice”) no later than
five (5) Business Days following the end of the Calendar Quarter during which one or more Offer to Repurchase Events occurred to all, but not less
than all, of the Holders (the date the Corporation delivers such no- tice to all Holders is referred to as an “Offer to Repurchase Notice Date”) and offer to
repurchase (an “Offer to Repurchase”) from each Holder a number of such Holder’s Series A Preferred Shares equal to no less than such Holder’s Offer
to Repurchase
Pro Rata Portion of the Offer to Repurchase Percentage of the Series A Preferred Shares then issued and outstanding (such num- ber of Series A
Preferred Shares, the “Offer to Repurchase Shares”). An Offer to Repurchase shall offer to redeem each such Of- fer to Repurchase Share for cash at a
price equal to the applicable Offer to Repurchase Price. Within twenty (20) Business Days after the receipt by the Holder of an Offer to Repurchase
Notice, each Holder may require the Corporation to redeem to the fullest extent permitted by law and out of funds lawfully available therefor, at the
Offer to Repurchase Price, up to the amount of such Holder’s Offer to Repurchase Shares by delivering written notice thereof (an “Acceptance Notice”)
to the Corporation which Acceptance Notice shall indicate the number of Offer to Repurchase Shares that such Holder is electing to redeem and the
wire instructions for the payment of the applicable Offer to Repurchase Price to such Holder. Each Offer to Repurchase shall oc- cur on the thirtieth
(30th) Business Day following the end of the Calendar Quarter during which one more Offers to Repurchase giving rise to the applicable Offer to
Repurchase occurred (an “Offer to Repurchase Date”). Each Offer to Repurchase Notice shall (A) describe the applicable Offer to Repurchase Event,
including, without limitation, the calculation of the Offer to Repur- chase Pro Rata Portion, the Offer to Repurchase Percentage and the Offer to
Repurchase Price and (B) state the maximum Offer to Repurchase Price to be paid to such Holder on such Offer to Repurchase Date. On the
applicable Offer to Repurchase Date the Corporation shall deliver or shall cause to be delivered to the Holder to the fullest extent permitted by law and
out of funds law- fully available therefor the Offer to Repurchase Price in cash by wire transfer of immediately available funds pursuant to wire in-
structions provided by the Holder in writing to the Corporation in its Acceptance Notice. Unless otherwise indicated in a Conver- sion Notice, all Series
A Preferred Shares converted by the Holder after the Offer to Repurchase Notice Date shall reduce the Holder’s right to require redemption of the
Holder’s Offer to Repurchase Shares on a one-for-one basis.
Change of Control Redemption Rights.
Holders’ Change of Control Redemption Right. No later than ten (10) days prior to the consum- mation of a
Change of Control, or, if not practicable as promptly as reasonably practicable after the Corporation is aware of
such Change of Control, the Corporation shall deliver written no- tice thereof to the Holders (a “Change of Control
Notice”) setting forth a description of such transaction in reasonable detail and the anticipated Change of Control
Redemption Date (as defined below) if then known. At any time during the period beginning after a Holder’s receipt
of a Change of Control Notice and ending on the date that is twenty (20) Trading Days after the consummation of
such Change of Control, such Holder may require the Corporation to redeem (a “Change of Control Redemption”), to
the fullest extent permitted by law and out of funds lawfully available therefor, all or any portion of such Holder’s
Series A Preferred Shares by de- livering written notice thereof (“Change of Control Redemption Notice”) to the
Corporation and, if the Transfer Agent maintains the register and records pursuant to Section (17), the Transfer
Agent, which Change of Control Redemption Notice shall indicate the number of Series A Preferred Shares such
Holder is electing to redeem (which number shall be at least one thousand (1,000) Series A Preferred Shares)
(unless it holds fewer than 1,000 Series A Pre- ferred Shares at the time of such request, in which case, it must
convert such number of Series A Preferred Shares held) and include wire instructions for the payment of the
applicable Change of Control Redemption Price. Any Series A Preferred Shares subject to redemption pur- suant
to this Section (9)(a) shall, to the fullest extent permitted by law and out of funds lawfully available therefor, be
redeemed by the Corporation in cash, without interest, at a price equal to the sum of (A) the greater of (x) the
Conversion Amount of the Series A Preferred Shares be-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 21 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
ing redeemed and (y) the Change of Control As-Converted Value with respect to the Series A Preferred Shares
being redeemed, (B) the Make-Whole Amount and (C) accrued and unpaid Di- vidends, if any (and any accrued
and unpaid dividends accrued pursuant to Section (5)(c)), with respect to such Series A Preferred Shares being
redeemed (the amount in this clause (C), the “Change of Control Accrued Dividends Payment”, the sum of the
amounts in the immediately preceding clauses (A) and (B), the “Base Change of Control Redemption Price” and
the sum of
the amounts in the immediately preceding clauses (A), (B) and (C), the “Change of Control Re-
demption Price”); provided, however, that each Holder, at its option, may, instead of requiring the redemption of any
Series A Preferred Shares, elect in its Change of Control Redemption Notice to require the Corporation to
exchange such Series A Preferred Shares for (1) such num- ber of Common Shares (the “Redemption Exchange
Shares”) calculated by dividing (x) the ap- plicable Base Change of Control Redemption Price, by (y) the applicable
Make-Whole Share Price, and, (2) to the fullest extent permitted by law and out of funds lawfully available therefor,
the applicable Change of Control Accrued Dividends Payment in cash (together with the Re- demption Exchange
Shares, the “Redemption Exchange Consideration”). The Corporation shall make payment of the Change of Control
Redemption Price, or the exchange of Series A Preferred Shares for Redemption Exchange Consideration,
concurrently with the consumma- tion of such Change of Control if such a Change of Control Redemption Notice is
received at least five (5) Trading Days prior to the consummation of such Change of Control and within five
(5) Trading Days after the Corporation’s receipt of such notice otherwise (the “Change of Con-
trol Redemption Date”). Once a Change of Control Redemption Notice has been delivered, the Series A Preferred
Shares submitted for redemption (or exchange) under this Section (9)(a) may not be converted, in whole or in part,
pursuant to Sections(6)(a)-(c). In the event that a Holder elects to require the exchange of Series A Preferred
Shares for Re- demption Exchange Consideration as set forth above, the Corporation shall make appropriate
provision to ensure that such Holder will have the right to receive, in exchange for the Re- demption Exchange
Shares included in such Redemption Exchange Consideration (or in lieu of Redemption Exchange Shares
included in such Redemption Exchange Consideration, if the Change of Control is consummated before the
delivery of such Redemption Exchange Shares), such shares of stock, securities, cash, assets or any other
property whatsoever (including war- rants or other purchase or subscription rights), if any, which are paid to the
holders of Com- mon Shares of the Corporation in connection with such Change of Control in accordance with
Section (9)(c). Notwithstanding anything to the contrary contained in this Section (9)(a), in the event of a Change
of Control Redemption, the Corporation shall only pay the Change of Control Redemption Price in cash as
required by this Section (9) after paying in full in cash all obligations of the Corporation and its Subsidiaries under
any credit agreement, indenture or similar agreement evidencing indebtedness for borrowed money (including the
termination of all commitments to lend, to the extent required by such credit agreement, indenture or similar
agreement) in excess of US$50.0 million, individually, and in existence at the time of such Change of Control
Redemption (without giving effect to any amendment, supplement, restate- ment, replacement, refinance or other
modification thereto on or after or in anticipation of
such Change of Control) (collectively, the “Debt Documents”), which requires prior payment of
the obligations thereunder (and termination of commitments thereunder, if applicable) as a condition to the
payment of such Change of Control Redemption Price in cash (all such re- quired payments under the Debt
Documents in the event of a Change of Control are collect- ively referred to as the “Senior Debt Payments”;
provided, however, that the Corporation shall use its commercially reasonable best efforts to pay such Senior Debt
Payments without delay
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 22 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
in accordance with the terms of the Debt Documents and shall not be allowed to circumvent any payment of a
Change of Control Redemption Price by unnecessarily delaying the payment of any Senior Debt Payments.
Redemption by the Corporation Upon a Qualified Change of Control. In the case of a Change of Control as a
result of which the Series A Preferred Shares are not convertible into common share capital that is quoted on or
listed for trading on an Eligible Market (a “Qualified Change
of Control”), any Series A Preferred Shares, may be redeemed, at the option of the Corpora-
tion (or its successor or the acquiring or surviving Person in such Qualified Change of Control), upon not less than
thirty (30) days’ notice delivered to the Holders not later than ten (10) days after the consummation of such
Qualified Change of Control, at a redemption price per share equal to the Change of Control Redemption Price
with respect to such Qualified Change of Control. Unless the Corporation (or its successor or the acquiring or
surviving Person in such Qualified Change of Control) defaults in making the redemption payment on the
applicable Change of Control Redemption Date, on and after such Change of Control Redemption Date, (A)
Dividends shall cease to accrue on the Series A Preferred Shares so called for redemp- tion, (B) all Series A
Preferred Shares called for redemption shall no longer be deemed out- standing and (C) all rights with respect to
such Series A Preferred Shares shall on such Change of Control Redemption Date cease and terminate, except
only the right of the Holders thereof to receive the amount payable in such redemption.
Corporate Events. If there shall occur any Fundamental Transaction, as a result of which the Common Shares are
converted into or exchanged for securities, cash, assets or other property (a “Corporate Event”), then following any
such Corporate Event, each Series A Preferred Share shall remain outstanding (subject to the last paragraph of
Section (14)) and be convertible into the number, kind and amount of securities, cash, assets or other property
which a Holder would have received in such Corporate Event had such Holder converted its Series A Preferred
Share into the applicable number of Common Shares immediately prior to the effective date of the Corporate
Event using the Conversion Rate applicable immediately prior to the effective date of such Corporate Event (the
“Reference Property”); and, in such case, appropriate ad- justment shall be made in the application of the provisions
set forth in Section (7) and this Sec- tion (9)(c) with respect to the rights and interests thereafter of the Holders, to
the extent that the provisions set forth in Section (7) and this Section (9)(c) (including provisions with respect to
changes in and other adjustments of the Conversion Rate) and Section (9) shall thereafter be applicable in relation
to any securities, cash, assets or other property thereafter deliverable upon the conversion of the Series A
Preferred Shares. The Corporation (or any successor thereto) shall, no less than twenty (20) Business Days prior
to the occurrence of any Corporate Event, provide written notice to the Holders of such occurrence of such event
and of the kind and amount of the securities, cash, assets or other property that each Series A Preferred Share
will be convertible into under this Section (9)(c). Failure to deliver such notice shall not affect the operation of this
Section (9)(c). The Corporation shall not enter into any agreement for a transaction constituting a Corporate Event
unless, subject to the last paragraph of Sec- tion (14), (i) such agreement provides for, or does not interfere with or
prevent (as applicable), conversion of the Series A Preferred Shares in a manner that is consistent with and gives
effect to this Section (9)(c) and (ii) to the extent that the Corporation is not the surviving entity in such Corporate
Event or will be dissolved in connection with such Corporate Event, proper provision shall be made in the
agreements governing such Corporate Event for the conversion of the Series A Preferred Shares into the
Reference Property and the assumption by such Person of
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 23 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
the obligations of the Corporation under these Articles. If the Corporate Event causes the Com- mon Shares to be
converted into, or exchanged for, the right to receive more than a single type of consideration (determined based
in part upon any form of shareholder election), then for the purposes of this Section (9)(c), the Reference Property
into which the Series A Preferred Shares shall be convertible shall be deemed to be the weighted average of the
types and amounts of consideration per share actually received by holders of Common Shares. The Cor- poration
shall notify Holders of the weighted average as soon as practicable after such determ- ination is made. The
provisions of this Section shall apply similarly and equally to successive Corporate Events and shall be applied
without regard to any limitations on the conversion of the Series A Preferred Shares.
Right of the Holders to Convert to Series A-1 and Series A-2 Preferred Shares; Corporation’s Option to Redeem Upon Such Re- quest.
Conversion to Series A-1. Each Holder shall have the right, at such Holder’s option on or prior to the thirtieth (30th)
day immediately preceding the fourth (4th) anniversary of the Issuance Date, but not prior to the date that is sixty
(60) days prior to such date, subject to the conver- sion procedures set forth in Section (10)(e) and the
Corporation’s right to effect a Corporation Dividend Increase Redemption pursuant to Section (11)(b)(iii), to convert
each Series A Pre- ferred Share of such Holder into one Series A-1 Preferred Share (as defined below) (the “Series
A-1 Conversion Right”). The right of conversion may be exercised as to all or any portion of
such Holder’s Series A Preferred Shares; provided that, in each case, no right of conversion may be exercised by
a Holder in respect of less than one (1) Series A Preferred Share (as adjus- ted for any share dividend, share split,
share combination, reclassification or similar transac- tion relating to the Series A Preferred Shares occurring after
the Subscription Date). On the fourth (4th) anniversary of the Issuance Date (the “Series A-1 Conversion Date”), if
the Corpor- ation has not delivered a Corporation Dividend Increase Redemption Notice prior to such date, then
the Corporation shall convert the amount of Series A Preferred Shares specified in the Di- vidend Increase
Conversion Notice (as defined in Section (10)(e)), if any, to Series A-1 Preferred Shares as of the Series A-1
Conversion Date. For the avoidance of doubt, (i) the Conversion
Amount of the Series A-1 Preferred Shares to be issued upon such conversion shall equal the Conversion Amount
of the Series A Preferred Shares submitted for conversion upon exercise of the Series A-1 Conversion Right set
forth herein and (ii) accrued and unpaid Dividends, if any (and any accrued and unpaid dividends accrued
pursuant to Section (5)(c)), in respect of Series A Preferred Shares converted for Series A-1 Preferred Shares
pursuant to this Section (10)(a) will be converted into accrued and unpaid Dividends (and any accrued and unpaid
dividends accrued pursuant to Section (5)(c)), in respect of such Series A-1 Preferred Shares.
Series A-1 Preferred Shares. Upon the Holder exercising its Series A¬1 Conversion Right pursu- ant to Section
(10)(a), the Corporation shall on or prior to the Series A-1 Conversion Date create the Series A-1 Preferred Shares
and, upon such creation, the Corporation shall at all times re- serve and keep available out of its authorized and
unissued Senior Preferred Shares, solely for designation as Series A-1 Senior Preferred Shares (each, a “Series A-
1 Preferred Share” and
collectively, the “Series A-1 Preferred Shares”) to be issued upon the conversion of the Series
A Preferred Shares, such number of Senior Preferred Shares as shall from time to time be equal to the number of
Series A-1 Preferred Shares issuable upon the conversion of all the Series A Preferred Shares then outstanding.
Any Series A-1 Preferred Shares issued upon con-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 24 of 50
Exhibit 3.1
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
version of Series A Preferred Shares shall be duly authorized, validly issued, fully paid and nonassessable.
Conversion to Series A-2. Each Holder shall have the right, at such Holder’s option on or prior to the thirtieth (30th)
day immediately preceding the ninth (9th) anniversary of the Issuance Date, but not prior to the date that is sixty
(60) days prior to such date, subject to the conver- sion procedures set forth in Section (10)(e) and the
Corporation’s right to effect a Corporation Dividend Increase Redemption pursuant to Section (11)(b)(iii), to convert
each of such Holder’s Series A Preferred Share and/or Series A-1 Preferred Share into a Series A-2 Preferred
Share
(as defined below) (the “Series A-2 Conversion Right”). The right of conversion may be exer-
cised as to all or any portion of such Holder’s Series A Preferred Shares and/or Series A-1 Pre- ferred Shares;
provided that, in each case, no right of conversion may be exercised by a Holder in respect of less than one (1)
Series A Preferred Share (as adjusted for any share dividend, share split, share combination, reclassification or
similar transaction relating to the Series A Preferred Shares occurring after the Subscription Date) and/or one (1)
Series A¬1 Preferred Share (as adjusted for any share dividend, share split, share combination, reclassification or
similar transaction relating to the Series A-1 Preferred Shares occurring after the Subscription Date). On the ninth
(9th) anniversary of the Issuance Date (the “Series A-2 Conversion Date”
and together with the Series A-1 Conversion Date a “Dividend Increase Conversion Date”), if
the Corporation has not delivered a Corporation Dividend Increase Redemption Notice prior to such date, then the
Corporation shall convert the amount of Series A Preferred Shares and/or Series A-1 Preferred Shares, as
applicable, specified in the Dividend Increase Conversion Notice to Series A-2 Preferred Shares as of the Series
A-2 Conversion Date. For the avoidance of doubt, (i) the Conversion Amount of the Series A-2 Preferred Shares to
be issued upon such conversion shall equal the Conversion Amount of the Series A Preferred Shares and/or the
Series A-1 Preferred Shares submitted for conversion upon exercise of the Series A-2 Conver- sion Right set forth
herein, (ii) the Series A-2 Conversion Right entitles (x) a Holder to convert all or some of such Holder’s Series A
Preferred Shares into Series A-2- Preferred Shares and (y) a holder of Series A-1 Preferred Shares to convert all
or some of such Holder’s Series A-1 Pre- ferred Shares into Series A-2- Preferred Shares and (iii) accrued and
unpaid Dividends, if any (and any accrued and unpaid dividends accrued pursuant to Section (5)(c)), in respect of
Series A Preferred Shares or Series A-1 Preferred Shares, as the case may be, converted for Series A-2 Preferred
Shares pursuant to this Section (10)(c) will be converted into accrued and unpaid Di- vidends (and any accrued
and unpaid dividends accrued pursuant to Section (5)(c)), in respect of such Series A-2 Preferred Shares.
Series A-2 Preferred Shares. Upon the Holder exercising its Series A¬2 Conversion Right pursu- ant to Section
(10)(c), the Corporation shall on or prior to the Series A-2 Conversion Date create the Series A-2 Preferred Shares
and, upon such creation, the Corporation shall at all times re- serve and keep available out of its authorized and
unissued Senior Preferred Shares, solely for designation as Series A-2 Senior Preferred Shares (each, a “Series
A-2 Preferred Share” and col- lectively, the “Series A-2 Preferred Shares”), to be issued upon the conversion of the
Series A Preferred Shares and/or Series A-1 Preferred Shares, such number of Series A-2 Preferred Shares as
shall from time to time be equal to the number of Series A Preferred Shares and Series A-1 Preferred Shares
issuable upon the conversion of all Series A Preferred Shares and
Series A-1 Preferred Shares then outstanding. Any Series A-2 Preferred Shares issued upon conversion of Series
A Preferred Shares and/or Series A-1 Preferred Shares, as applicable, shall be duly authorized, validly issued,
fully paid and nonassessable.
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 25 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Exhibit 3.1
Optional Redemptions.
Notice of Intended Conversion. To exercise its Series A-1 Conversion Right or its Series A-2 Con- version
Right, a Holder shall, not less than thirty (30) days prior to the fourth (4th) or ninth (9th) anniversary of the
Issuance Date, as applicable, but not prior to the date that is sixty (60) days prior to such date, (A) deliver a
written notice executed by the registered Holder of the Series A Preferred Shares and/or Series A-1 Preferred
Shares, as applicable, subject to such conversion (a “Dividend Increase Conversion Notice”) to the Corporation,
which Dividend Increase Con- version Notice shall indicate the amount of Series A Preferred Shares and/or
Series A-1 Pre- ferred Shares, as applicable, such Holder is electing to convert pursuant to Sections (10)(a) or
(c), as applicable; and (B) deliver to the Corporation funds for the payment of any applicable share transfer,
documentary, stamp or similar taxes.
Series A-1 and B-2 Articles of Amendment. If a Holder validly delivers a Dividend Increase Con- version Notice
and the Corporation does not exercise its right to redeem pursuant to Sec- tion (11)(b)(iii) with respect to all
Series A Preferred Shares and/or Series A-1 Preferred Shares, as applicable, specified in the Holder’s
Dividend Increase Conversion Notice, then the Corpora- tion shall, prior to the Dividend Increase Conversion
Date, file Articles of Amendment setting forth the designation, preferences and rights of the Series A-1
Preferred Shares or Series A-2 Preferred Shares, as applicable, which Articles of Amendment will be in the
same form as these Articles of Continuance, except for changes (i) to account for the different series, different
dates, including issuance dates, and changes in law, (ii) in the case of the Series A-1 Preferred Shares Articles
of Amendment, to Sections (10) and (11) to, among other things, account for the right of Series A-1 Preferred
Shares to convert into Series A-2 Preferred Shares, to reserve an adequate amount of Senior Preferred
Shares to accommodate such conversion right and to provide a redemption right by the Corporation analogous
to the rights in Section (11)(b)(iii) to provide for the Corporation’s right to redeem the Series A-1 Preferred
Shares upon a Holder exercising its right to convert Series A-1 Preferred Shares into Series A-2 Preferred
Shares and, in the case of the Series A-2 Preferred Shares Articles of Amendment, to eliminate this Sec- tion
(10) conversion right for the Series A-2 Preferred Shares and the corresponding Corpora- tion redemption right
in Section (11)(b)(iii) and (iii) to the Preferential Dividend Rate, which with respect to the Series A-1 Preferred
Shares shall replace “5.50%” with “7.50%”, and with respect to the Series A-2 Preferred Shares shall replace
“5.50%” or “7.50%”, as the case may be, with the fixed percentage equal to the greater of (x) 600 bps over the
Daily Simple SOFR as in effect on the first date a Holder validly delivers a Dividend Increase Conversion
Notice in respect of its Series A-2 Conversion Right to the Corporation and (y) 10.50%. The Series A-1
Preferred Shares and Series A-2 Preferred Shares shall have the same preferences, rights and obligations as
the Series A Preferred Shares, other than solely with respect to the Preferential Dividend Rate. For the
avoidance of doubt, Dividends on the Series A-1 Preferred Shares and on the Series A-2 Preferred Shares
shall start to accrue as of the applicable Dividend Increase Conversion Date.
General. Other than as specifically permitted by these Articles of Continuance, the Corporation may not
redeem any of the outstanding Series A Preferred Shares (it being understood that the Corporation may
purchase Series A Preferred Shares in the open market or in negotiated transactions).
Redemption at the Option of the Corporation.
Corporation Optional Redemption. At any time after February 1, 2032, so long as
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 26 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
there is no Equity Conditions Failure on the applicable Corporation Optional Redemp- tion Date (as
defined below), the Corporation shall have the right to redeem all or any portion of the Series A Preferred
Shares then outstanding as designated in the applic- able Corporation Optional Redemption Notice (as
defined below) (the “Corporation
Optional Redemption Shares”) on the applicable Corporation Optional Redemption
Date (a “Corporation Optional Redemption”). Each Corporation Optional Redemp- tion Share shall be
redeemed by the Corporation on the applicable Corporation Op- tional Redemption Date in cash, without
interest, at a price equal to 100% of the Con- version Amount of such Corporation Optional Redemption
Share plus accrued and unpaid Dividends thereon, if any (and any accrued and unpaid dividends
thereon ac- crued pursuant to Section (5)(c)) (the “Corporation Optional Redemption Price”). The
Corporation may exercise its right to redeem the Corporation Optional Redemp- tion Shares under this
Section (11)(b)(i) by delivering a written notice thereof to all, but not less than all, of the Holders (a
“Corporation Optional Redemption Notice” and
the date the Corporation delivers such notice to all Holders is referred to as a “Cor-
poration Optional Redemption Notice Date”). Each Corporation Optional Redemp- tion Notice shall be
irrevocable. Each Corporation Optional Redemption Notice shall (A) state the date on which the
applicable Corporation Optional Redemption shall occur (a “Corporation Optional Redemption Date”), which
date shall be the forty fifth (45th) day (or, if such date falls on a day that is not a Business Day, the next
day that is a Business Day) following the applicable Corporation Optional Redemption Notice Date, (B)
state the number of the Series A Preferred Shares which the Corpora- tion has elected to redeem from
the Holders on the applicable Corporation Optional Redemption Date and (C) confirm that there is no
Equity Conditions Failure on the ap- plicable Corporation Optional Redemption Notice Date.
Corporation Merger Termination Redemption. If the Merger Agreement is terminated in accordance with
its terms and all confidential information that constitutes material, nonpublic information communicated
by the Corporation, any of its Subsidiaries or any of their respective Affiliates, employees, officers,
representatives or agents to the Buyers (as defined in the Securities Purchase Agreement) or any of their
Affiliates has been publicly disclosed, then during the ninety (90) days following the later of (x) Au- gust
7, 2023 and (y) the termination of the Merger Agreement, so long as there is no Equity Conditions Failure
on the applicable Corporation Merger Termination Redemp- tion Notice Date (as defined below), the
Corporation shall have the right to redeem between fifty percent (50%) and one hundred percent (100%)
of the Series A Preferred Shares then outstanding as designated in the applicable Corporation Merger
Termin-
ation Redemption Notice (as defined below) (the “Corporation Merger Termination
Redemption Shares”) on the applicable Corporation Merger Termination Redemp- tion Date (a “Corporation
Merger Termination Redemption”). Each Corporation Merger Termination Redemption Share shall be
redeemed by the Corporation on the
Corporation Merger Termination Redemption Date in cash, without interest, at a price equal to 102% of
the sum of (x) the Conversion Amount of such Corporation Merger Termination Share and (y) accrued
and unpaid Dividends thereon, if any (and any ac- crued and unpaid dividends thereon accrued pursuant
to Section (5)(c)) (the “Corpor-
ation Merger Termination Redemption Price”). The Corporation may exercise its
right to redeem the Corporation Merger Termination Redemption Shares by deliver-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 27 of 50
Exhibit 3.1
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
ing a written notice thereof to all, but not less than all, of the Holders (a “Corporation Merger Termination
Redemption Notice” and the date the Corporation delivers such notice to all Holders is referred to as a
“Corporation Merger Termination Redemp-
tion Notice Date”). Each Corporation Merger Termination Redemption Notice shall
be irrevocable. Each Corporation Merger Termination Redemption Notice shall (A) state the date on
which the applicable Corporation Merger Termination Re- demption shall occur (a “Corporation Merger
Termination Redemption Date”), which date shall be the tenth (10th) day (or, if such date falls on a day that
is not a Business Day, the next day that is a Business Day) following the applicable Corpora- tion Merger
Termination Redemption Notice Date, (B) state the number of the Series A Preferred Shares which the
Corporation has elected to redeem from the Holders on the Corporation Merger Termination Redemption
Date, and (C) confirm that there is no Equity Conditions Failure on the applicable Corporation Merger
Termination Re-
demption Notice Date.
Corporation Redemption Upon Dividend Increase. If one or more Holders delivered a Dividend Increase
Conversion Notice to the Corporation in compliance with Sec- tion (10), so long as there is no Equity
Conditions Failure on the applicable Corpora- tion Dividend Increase Redemption Date (as defined
below), the Corporation shall have the right to redeem all or any portion of the Series A Preferred Shares
and/or Series A-1 Preferred Shares, as applicable, for which an increase in the Preferential Di- vidend
Rate has been demanded, as designated in the applicable Corporation Di-
vidend Increase Redemption Notice (as defined below) (such shares the “Corporation
Dividend Increase Redemption Shares”) on the applicable Corporation Dividend In- crease Redemption Date
(a “Corporation Dividend Increase Redemption”). The Cor- poration Dividend Increase Redemption Shares
shall be redeemed by the Corporation
on the applicable Corporation Dividend Increase Redemption Date in cash, without in- terest, at a price
equal to 100% of the Conversion Amount of the Corporation Di- vidend Increase Redemption Shares to
be redeemed plus accrued and unpaid Di- vidends thereon, if any (and any accrued and unpaid
dividends thereon accrued pur- suant to Section (5)(c)) (a “Corporation Dividend Increase Redemption
Price”). The Corporation may exercise its right to require redemption under this Section (11)(b)(iii) by
delivering a written notice thereof by no later than the forty fifth (45th) day immediately following the
fourth (4th) anniversary of the Issuance Date or the ninth (9th) anniversary of the Issuance Date, as
applicable (or, if such date
falls on a day that is not a Business Day, the next day that is a Business Day), to all, but not less than all,
of the Holders who delivered a Dividend Increase Conversion No- tice to the Corporation in compliance
with this Section (11)(b)(iii) (a “Corporation Di-
vidend Increase Redemption Notice”, and the date such notice is given to all of the
Holders is referred to as a “Corporation Dividend Increase Redemption Notice Date”). Each Corporation
Dividend Increase Redemption Notice shall be irrevocable. Each Corporation Dividend Increase
Redemption Notice shall (A) state the date on which the applicable Corporation Dividend Increase
Redemption shall occur (a “Cor- poration Dividend Increase Redemption Date”), which date shall be the forty
fifth
(45th) day (or, (x) if such date falls on a day that is not a Business Day, the next day that is a Business
Day or (y) if there is an Equity Conditions Failure on such day, the first Business Day thereafter upon
which there is no Equity Conditions
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 28 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Failure; provided that such Business Day occurs no later than the forty fifth (45th) day thereafter (the
“Extended Dividend Increase Redemption Date”); provided, further, that in the event of clause (y) such Holder
may elect to revoke its election to convert its Series A Preferred Shares into Series A-1 Preferred Shares
or Series A¬2 Preferred Shares, as applicable, and consequently revoke the Corporation’s right to effect
a re- lated Corporation Dividend Increase Redemption) following the applicable Corpora- tion Dividend
Increase Redemption Notice Date, (B) state the aggregate Conversion Amount of the Series A Preferred
Shares and/or Series A-1 Preferred Shares, as ap- plicable, which the Corporation has elected to
redeem from the Holders on the applic-
able Corporation Dividend Increase Redemption Date, (C) state the amount of ac- crued and unpaid
Dividends, if any (and any accrued and unpaid dividends accrued pursuant to Section (5)(c)), with
respect to such Series A Preferred Shares redeemed by the Corporation pursuant to this Section (11)(b)
(iii) and (D) confirm that there is no Equity Conditions Failure as of the applicable Corporation Dividend
Increase Redemp- tion Notice Date.
Corporation Redemptions. If the Corporation confirmed that there was no Equity Con- ditions Failure as
of the applicable Corporation Redemption Notice Date but an Equity Conditions Failure occurs between
the applicable Corporation Redemption Notice Date and the applicable Corporation Redemption Date (a
“Corporation Redemption
Interim Period”) that the Corporation expects will last through the applicable Corpor-
ation Redemption Date, the Corporation shall provide the Holders a subsequent writ- ten notice to that
effect. If there is an Equity Conditions Failure on the applicable Cor- poration Redemption Date (and,
with respect to Section (11)(b)(iii), the Extended Di- vidend Redemption Date), then the applicable
Corporation Redemption shall be null and void with respect to all or any part designated by such Holder
of the applicable unconverted Corporation Redemption Shares and such Holder shall be entitled to all
the rights of a Holder with respect to such applicable Corporation Redemption Shares; provided,
however, that if a Holder waives in writing an Equity Conditions Fail- ure during the applicable
Corporation Redemption Interim Period, then the Corpora- tion shall be required to proceed with the
applicable Corporation Redemption Date with respect to such Holder. If the Corporation elects to cause a
Corporation Redemp- tion pursuant to this Section (11), then it must simultaneously take the same action
in the same proportion with respect to all Corporation Redemption Shares subject to the applicable
Corporation Redemption to the extent practicable, or, if the pro rata basis is not practicable for any
reason, by lot or such other equitable method as the Corporation determined in good faith. If the
applicable Corporation Redemption No- tice shall have been duly given, the Corporation shall irrevocably
deposit or set aside the aggregate Corporation Redemption Price to be paid to all Holders of the
Corpora- tion Redemption Shares entitled thereto and, from and after the applicable Corpora- tion
Redemption Date, the applicable Corporation Redemption Price shall promptly be paid to all former
Holders of Corporation Redemption Shares entitled thereto in respect thereof. So long as the applicable
aggregate Corporation Redemption Price shall be paid in full to such Holders or is irrevocably deposited
or set aside with a de- pository for payment to the Holders, the applicable Corporation Redemption shall
be effective with respect to all Corporation Redemption Shares on the applicable Corpor- ation
Redemption Date, and thereupon Dividends with respect to such Corporation Redemption Shares shall
cease to accrue and all rights with respect to such Corpora-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 29 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
tion Redemption Shares shall forthwith terminate. Notwithstanding anything to the contrary in these
Articles of Continuance, until the applicable Corporation Redemp- tion Price is paid in full, the Series A
Preferred Shares subject to the applicable Cor- poration Redemption may be converted, in whole or in
part, by such Holder into Com- mon Shares pursuant to Section (6). All Series A Preferred Shares
converted by a Holder after a Corporation Redemption Notice Date shall reduce the number of Series A
Preferred Shares required to be redeemed on the applicable Corporation Re- demption Date, unless
such Holder otherwise indicates in the applicable Conversion Notice.
Void Redemption. In the event that the Corporation does not pay a Corporation Redemption Price within the
applicable time period, at any time thereafter and until the Corporation pays such unpaid applicable Corporation
Redemption Price in full, a Holder shall have the option to, in lieu of redemption, require the Corporation to
promptly return to such Holder any or all of the Series A Preferred Shares that were submitted for redemption by
such Holder and for which the applicable Corporation Redemption Price has not been paid, by sending written no-
tice thereof to the Corporation (the “Void Optional Redemption Notice”). Upon the Corpora-
tion’s receipt of such Void Optional Redemption Notice prior to the payment of the applicable Corporation
Redemption Price, (i) any applicable redemption notice of such Holder or the Cor- poration, as the case may be,
shall be null and void with respect to those Series A Preferred Shares subject to the Void Optional Redemption
Notice and (ii) the Corporation shall immedi- ately return any Series A Preferred Shares subject to the Void
Optional Redemption Notice.
Effect of Redemption. Subject to Section (11)(c), effective immediately prior to the close of busi- ness on the day
before any Series A Preferred Shares are redeemed pursuant to these Articles of Continuance, Dividends shall no
longer accrue or be declared on any such Series A Preferred Shares, and such Series A Preferred Shares shall
cease to be outstanding.
Status of Redeemed Shares. Series A Preferred Shares redeemed in accordance with these Art- icles of
Continuance shall return to the status of and constitute authorized but unissued Senior Preferred Shares, without
classification as to series until such shares are once more classified as to a particular series by the Board
pursuant to provisions of the Articles.
Reservation of Shares. The Corporation shall have sufficient authorized and unissued Common Shares for each of the Series A Preferred Shares
equal to no less than the lesser of (x) the Exchange Cap and (y) 110% of the maximum number of Common Shares issuable with respect to the
outstanding Series A Preferred Shares pursuant to the terms of these Articles of Continuance (assuming for purposes of this clause (y), that the
Conversion Amount of the Series A Preferred Shares are convertible at the Conversion Rate and without taking into account any limitations on the
conversion of the Series A Preferred Shares set forth in these Articles of Continuance) (the “Required Reserved Amount”). The Corporation shall, so long
as any of the Series A Pre- ferred Shares are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued
Com- mon Shares, solely for the purpose of issuing Common Shares with respect of the Series A Preferred Shares pursuant to the terms of these
Articles of Continuance, no less than a number of Common Shares equal to the Required Reserved Amount.
Voting Rights. Other than in connection with Parent Shareholders Meeting (as defined in the Merger Agreement), each Holder shall be entitled to the
whole number of votes equal to the number of whole Common Shares into which the aggregate of such Holder’s Series A Preferred Shares would be
convertible on the record date for the vote or consent of shareholders or if no re- cord date is established, at the date such vote or consent is taken,
and shall otherwise have voting rights and consent rights equal to the voting rights and consent rights of the Common Shares to the fullest extent
permitted by law provided, however, that until the HSR Date, with respect to any HSR Holder, such HSR Holder shall only be entitled to vote a number
of Series A Pre-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 30 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
ferred Shares in accordance with the foregoing on any matters relating to the election, designation, removal or replacement of members of the Board
to the extent that such number of Series A Preferred Shares together with such HSR Holder’s Common Shares, if any, other Junior Shares, if any, Pari
Passu Shares, if any, and Senior Preferred Shares of the Corporation, if any, does not exceed the HSR Amount in the aggregate; provided, further,
that the Required Holders, by written notice to the Corporation, may terminate the voting rights set forth in this Section (13) effective at any time from
and after the registration, if any, of the Series A Preferred Shares under the Exchange Act. Except as provided in the immediately preceding sentence,
each Holder shall be entitled to receive the same prior notice of any shareholders’ meeting as is provided to the holders of Common Shares in ac-
cordance with the by-laws of the Corporation, as well as prior notice of all shareholder actions to be taken by legally available means in lieu of a
meeting, and shall vote as a class with the holders of Common Shares as if they were a single class of securit- ies upon any matter submitted to a
vote of shareholders, except those matters required by law or by the terms hereof to be sub- mitted to a class vote of the Holders, in which case the
Holders only shall vote as a separate class, or those matters required by law to be submitted to a class vote of solely the holders of Common Shares,
in which case such holders only shall vote as a sep- arate class. Notwithstanding the foregoing, (i) no Holder shall be entitled, in its capacity as Holder
of the Series A Preferred Shares, to vote on the Parent Share Issuance (as defined in the Merger Agreement) and (ii) in no event shall a Holder be
entitled to such number of votes that is greater than the number of whole Series A Preferred Shares held by such Holder at the relevant time.
Series A Preferred Shares Approval Rights. In addition to any other rights provided by law, except where the vote or written con- sent of the holders of
a greater number of shares is required by law, for as long as any Series A Preferred Shares remain out- standing, the affirmative vote at a meeting
duly called for such purpose or the written consent without a meeting of the Required Holders but not of any other class of the Corporation’s
securities, voting as a single class (and separately from all other classes and series of shares in the capital of the Corporation), shall be required
before the Corporation may:
create (by reclassification or otherwise), or authorize the creation of, or issue or obligate itself to issue additional or
other Senior Shares or securities exchangeable for or convertible or exer- cisable into Senior Shares;
create (by reclassification or otherwise), or authorize the creation of, or issue or obligate itself to issue additional or
other Pari Passu Shares or securities exchangeable for or convertible or exercisable into Pari Passu Shares;
except as contemplated by Section (10), amend or repeal any provision of, or add any provision to, the Articles, or
file any articles of amendment, preferences, limitations and relative rights of any series of preferred shares, if such
action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions of the Series
A Preferred Shares, regardless of whether any such action shall be by means of amendment to the Articles or by
merger, consol- idation, amalgamation, arrangement or otherwise;
increase or decrease (other than by conversion or redemption in accordance with the terms hereof) the authorized
number of Series A Preferred Shares;
exchange, reclassify or cancel the Series A Preferred Shares, except as explicitly contemplated by these Articles
of Continuance; or
amend or waive any provision of these Articles of Continuance that would have an adverse ef- fect on the rights,
preferences, privileges, voting power or obligation of the Series A Preferred Shares or any Holder thereof.
Notwithstanding the provisions of this Section (14), (a) in the event of a Fundamental Transaction or Corporate Event, so long as: (i) the
Series A Preferred Shares remain outstanding following consummation of such Fundamental Transaction
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 31 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
or Corporate Event with its terms materially unchanged, taking into account that, upon the occurrence of such a Funda- mental Transaction
or Corporate Event, the Corporation may not be the surviving entity (in which case, the Series A Pre- ferred Shares may be converted into or
exchanged for preferred shares or other preferred equity of the surviving entity or its parent having terms substantially the same as the
Series A Preferred Shares) and, if applicable, with any changes to the terms of the Series A Preferred Shares required pursuant to and made
in compliance with the provisions of Sec- tion (9)(c) in connection with such Fundamental Transaction or Corporate Event or as otherwise
deemed reasonably ne- cessary by the Corporation and (ii) if such transaction also constitutes a Change of Control, the provisions of Sec-
tion (9)(a) and Section (9)(b) are complied with in connection with such Fundamental Transaction, then the occurrence of such Fundamental
Transaction shall not be deemed to adversely affect the powers, preferences, or other special rights or privileges of the Series A Preferred
Shares or its Holders and in such case such Holders shall not have any voting rights with respect to the occurrence of such Fundamental
Transaction or Corporate Event pursuant to this Sec- tion (14) and (b) the authorization or creation of, or the increase in the number of
authorized or issued shares of, or any securities convertible into shares of, or the reclassification of any security (in each case, other than the
Series A Pre- ferred Shares) into, or the issuance of, Junior Shares will not require the vote the holders of the Series A Preferred Shares.
General Provisions.
In addition to the above provisions with respect to Series A Preferred Shares, the Series A Pre- ferred Shares shall
be subject to and be entitled to the benefit of the provisions set forth in the Articles with respect to preferred shares
of the Corporation generally; provided, however, that in the event of any conflict between such provisions, the
provisions set forth in these Articles of Continuance shall control.
Any Series A Preferred Shares which are converted, repurchased or redeemed shall be auto- matically and
immediately retired and shall not be reissued, sold or transferred.
Whenever notice is required to be given under these Articles of Continuance, unless otherwise provided herein,
such notice shall be given by first-class mail to each record Holder of out- standing Series A Preferred Shares as
such Holder’s address as the same appears on the books of the Corporation or the Transfer Agent. With respect to
any notice to a Holder required to be provided hereunder, neither the failure to mail such notice, nor any defect
therein or in the mailing thereof, to any particular Holder shall affect the sufficiency of the notice or the validity of
the proceedings referred to in such notice with respect to the other Holders or affect the legality or validity of any
distribution, rights, warrant, reclassification, consolidation, merger, amalgamation, arrangement, conveyance,
transfer, dissolution, liquidation or winding up, or the vote upon any such action. Any notice which was mailed in
the manner herein provided shall be conclusively presumed to have been duly given or delivered as of the date
sent whether or not the Holder receives the notice. All notice periods referred to herein shall com- mence on the
date of the mailing of the applicable notice.
Whenever any amount expressed to be due by the terms of these Articles of Continuance is due on any day which
is not a Business Day, the same shall instead be due on the next suc- ceeding day which is a Business Day
without interest or penalty.
If any term of the Series A Preferred Shares set forth herein is invalid, unlawful or incapable of being enforced by
reason of any rule of law or public policy, all other terms set forth herein which can be given effect without the
invalid, unlawful or unenforceable term will, neverthe- less, remain in full force and effect, and no term herein set
forth will be deemed dependent
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 32 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
upon any other such term unless so expressed herein so long as these Articles of Continuance as so modified
continues to express, without material change, the original intentions of the parties as to the subject matter hereof
and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially impair
the respective expectations or re- ciprocal obligations of the parties or the practical realization of the benefits that
would other- wise be conferred upon the parties. The Corporation and the Required Holders will endeavor in good
faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect
of which comes as close as possible to that of the prohibited, in- valid or unenforceable provision(s).
It is the intent of the Corporation and the Required Holders that the provisions of these Articles of Continuance
comply, and following the date hereof continue to comply, with the applicable rules of The New York Stock
Exchange and The Toronto Stock Exchange, as the same may be amended from time to time, for as long as long
as the Corporation’s Common Shares are listed and posted for trading on The New York Stock Exchange and/or
The Toronto Stock Exchange, as the case may be (the “Applicable Stock Exchange Rules”). It is also the intent of the
Corpor- ation and the Required Holders that if the Corporation no longer has a class of securities re- gistered
under section 12 of the Exchange Act or is no longer required to file reports under Section 15(d) of the Exchange
Act, all Exchange Act, Securities Act and other United
States references herein shall be deemed to be to the Canadian equivalent, including under applicable Canadian
securities laws. In furtherance of the foregoing, if any term, covenant or restriction included in these Articles of
Continuance fails at any time to comply with the Applic- able Stock Exchange Rules, or it is reasonably necessary
and advisable to update the United States references to applicable Canadian references, the Corporation and the
Required Hold- ers agree to negotiate in good faith to modify these Articles of Continuance so as to comply with
the Applicable Stock Exchange Rules or to update with the applicable Canadian references while retaining the
original intent as closely as possible in an acceptable manner so that the transactions contemplated hereby be
consummated as originally contemplated to the fullest extent possible. Any amendment, modification or alteration
of the rights, preferences, priv- ileges or voting powers of the Series A Preferred Shares shall, solely to the extent
required by the Applicable Stock Exchange Rules, be subject to the approval of The New York Stock Ex- change
and/or The Toronto Stock Exchange, as the case may be for as long as the Common Shares are listed for trading
thereon.
Tax Matters.
Tax Withholdings. The Corporation shall be entitled to withhold or deduct, from any amounts payable or
otherwise deliverable under these Articles of Continuance, such amounts as the Corporation determines,
acting reasonably, are required to be deduc- ted or withheld with respect to such payment or delivery
under the Internal Revenue Code of 1986, as amended, the Income Tax Act (Canada) or any provision of any
other applicable laws. To the extent that such amounts are so deducted or withheld, such amounts shall
be treated for all purposes as having been paid to the Holder to whom such amounts would otherwise
have been paid, provided that such deducted or with- held amounts are remitted to the appropriate
governmental authority. The Corpora- tion is hereby authorized to sell or otherwise dispose of, on behalf
of any Holder, such portion of any share or other security deliverable to such Holder as is necessary to
provide sufficient funds to the Corporation to enable it to comply with such deduction
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 33 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
or withholding requirement and the Corporation shall notify such Holder thereof and remit the applicable
portion of the net proceeds of such sale to the appropriate gov- ernmental authority and, if applicable,
any portion of such net proceeds that is not re- quired to be so remitted shall be paid to such Holder. The
Holders shall, on a joint and several basis, indemnify and hold harmless the Corporation for any losses,
costs, penalties, fees, liabilities, damages and expenses incurred by the Corporation in re- spect of a
failure to withhold, deduct, or remit any amount required to be withheld, deducted, or remitted in respect
of any amounts payable pursuant to these Articles of Continuance.
Forms. If a Holder is entitled to claim an exemption or reduction from withholding tax in accordance with
applicable law, such Holder shall promptly deliver such properly completed and executed documentation
(including properly completed Canada Rev- enue Agency forms NR301, NR 302 or NR 303, as
applicable) reasonably requested by the Corporation as will permit such payments to be made without
withholding or at a reduced rate of withholding. The Corporation shall, acting reasonably, take into ac-
count all such properly completed forms in determining its withholding obligations under Section (15)(g)
(i). In addition, any Holder shall deliver such other tax document- ation prescribed by applicable law
(including any Internal Revenue Service form W-9 or form W-8, as applicable, or any forms or other
documentation as may be necessary for the Corporation to comply with its obligations under the Foreign
Account Tax Com- pliance Act or otherwise reasonably requested by the Corporation). Each Holder shall
provide new documentation (or successor documentation) upon the expiration or ob- solescence of any
previously delivered documentation and promptly notify the Cor- poration of any change in
circumstances which would modify or render invalid any claimed exemption or reduction.
Specified Amount. The specified amount in respect of the Series A Preferred Shares for purposes of
subsection 191(4) of the Income Tax Act (Canada) is the Canadian Dol- lar equivalent of US$1.00 per
Series A Preferred Share as of the date of issuance of such share.
Transfer of Series A Preferred Shares. A Holder may transfer some or all of the Series A Preferred Shares and the accompanying rights hereunder
held by such Holder without the consent of the Corporation; provided that such transfer is in compliance with applicable securities laws and the
Securities Purchase Agreement.
Series A Preferred Share Register.
The Corporation or the Transfer Agent shall maintain a register for the Series A Preferred Shares, in which the
Corporation or the Transfer Agent shall record the name and address of the Persons in whose name the Series A
Preferred Shares have been issued, as well as the name and address of each transferee. The Corporation may
treat the Person in whose name any Series A Preferred Share is registered on the register as the owner and
holder thereof for all purposes, notwithstanding any notice to the contrary, but in all events recognizing any prop-
erly made transfers.
The Corporation or the Transfer Agent shall maintain records showing the number of Series A Preferred Shares
converted and/or redeemed and the dates of such conversions and/or re- demptions. In the event of any dispute
or discrepancy, such records of the Corporation estab-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 34 of 50
Exhibit 3.1
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
lishing the number of Series A Preferred Shares to which the record holder is entitled shall be controlling and
determinative in the absence of manifest error.
Certain Defined Terms. For purposes of these Articles of Continuance the following terms shall have the following meanings: “Affiliate” shall have the
meaning ascribed to such term in Rule 405 of the Securities Act.
“Bloomberg” means Bloomberg Financial Markets.
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of
New York or Toronto, Ontario, Canada are authorized or required by law to remain closed; provided, however, for
clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to
“stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the
closure of any phys- ical branch locations at the direction of any governmental authority so long as the electronic
funds transfer systems (including for wire transfers) of commercial banks in The City of New York, New York or
Toronto, Ontario, Canada generally are open for use by customers on such day.
“Calendar Quarter” means each of: the period beginning on and including December 15 and ending on and including
March 14; the period beginning on and including March 15 and ending on and including June 14; the period
beginning on and including June 15 and ending on and in- cluding September 14; and the period beginning on and
including September 15 and ending on and including December 14.
“Change of Control” means any Fundamental Transaction other than (i) any reorganization, re- capitalization,
reclassification or change of the Common Shares or any share exchange, consol- idation, amalgamation,
arrangement, merger or similar transaction, in each case, in which holders of the Corporation’s voting power
immediately prior to such reorganization, recapital- ization, reclassification, change, share exchange,
consolidation, amalgamation, arrangement, merger or similar transaction continue immediately after the
consummation of such reorganiz- ation, recapitalization, reclassification, change, share exchange, consolidation,
amalgamation, arrangement, merger or similar transaction to hold publicly traded securities and, directly or
indirectly, the voting power of the surviving entity or entities necessary to elect a majority of the members of the
board of directors (or their equivalent if other than a corporation) of such entity or entities, or (ii) pursuant to a
continuance or migratory merger, amalgamation or ar- rangement effected solely for the purpose of changing the
jurisdiction of incorporation of the Corporation.
“Change of Control As-Converted Value” means, with respect to any Series A Preferred Shares, the product of (i) the
Conversion Amount of such Series A Preferred Shares multiplied by (ii) the Conversion Rate multiplied by (iii) the
Make-Whole Share Price with respect to the ap- plicable Change of Control.
“close of business” means 5:00 p.m. (New York City time).
“Closing Sale Price” of the Common Shares (or other security for which a closing sale price must be determined) on
any date means the closing sale price per share (or if no closing sale price is reported, the average of the bid and
ask prices or, if more than one in either case, the average of the average bid and the average ask prices) on that
date as reported in composite
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 35 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
transactions for the principal U.S. national or regional securities exchange on which the Com- mon Shares (or
such other security) is traded. If the Common Shares (or such other security) is not listed for trading on a U.S.
national or regional securities exchange on the relevant date, the “Closing Sale Price” shall be the last quoted bid
price for the Common Shares (or such other security) in the over-the-counter market on the relevant date as
reported by OTC Markets Group Inc. or a similar organization. If the Common Shares (or such other security) are
not so quoted, the “Closing Sale Price” shall be the average of the mid-point of the last bid and ask prices for the
Common Shares (or such other security) on the relevant date from each of at least three nationally recognized
independent investment banking firms selected by the Cor- poration for this purpose. The “Closing Sale Price” will
be determined without regard to after- hours trading or any other trading outside of the regular trading session
hour.
“Common Shares” means (i) the Corporation’s shares of common shares, without par value, or
(ii) any share capital into which such Common Shares shall have been converted or exchanged in a Corporate
Event.
“Conversion Amount” means, for each Series A Preferred Share, the Issue Price.
“Conversion Date” means with respect to a conversion pursuant to Section (6)(a), the date on which the Holder
complied with the procedures in Section (6)(c)(i) thereof.
“Conversion Price” means at any time, US$1.00, divided by the Conversion Rate at such time.
“Conversion Rate” means 0.0136986 Common Shares per US$1.00 Conversion Amount, sub- ject to adjustment as
set forth herein.
“Corporation Redemption” means, collectively, a Corporation Dividend Increase Redemption, a Corporation Optional
Redemption and a Corporation Merger Termination Redemption.
“Corporation Redemption Date” means a Corporation Dividend Increase Redemption Date, a Corporation Optional
Redemption Date and a Corporation Merger Termination Redemption Date, as applicable.
“Corporation Redemption Notice” means a Corporation Dividend Increase Redemption No- tice, a Corporation
Optional Redemption Notice and a Corporation Merger Termination Re- demption Notice, as applicable.
“Corporation Redemption Notice Date” means a Corporation Dividend Increase Redemption Notice Date, a
Corporation Optional Redemption Notice Date and a Corporation Merger Ter- mination Redemption Notice Date,
as applicable.
“Corporation Redemption Price” means a Corporation Dividend Increase Redemption Price, a Corporation Optional
Redemption Price and a Corporation Merger Termination Redemption Price, as applicable.
“Corporation Redemption Shares” means, collectively, the Corporation Dividend Increase Re- demption Shares, the
Corporation Optional Redemption Shares and the Corporation Merger Termination Redemption Shares.
“Current Market Price” per Common Share, as of any date of determination, means the arith-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 36 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
metic average of the Weighted Average Price per Common Share for each of the ten (10) con- secutive Trading
Days ending on the Trading Day immediately preceding such day, adjusted to take into account the occurrence
during such period of any event described in Section (7).
“Daily Simple SOFR” means the daily Secured Overnight Financing Rate provided by the FRBNY, as the
administrator of the benchmark (or a successor administrator), on the FRBNY’s Website, effective as of the
applicable date of determination.
“Designee” means Starboard Value and Opportunity Master Fund Ltd.
“Distribution Transaction” means any transaction by which a Subsidiary of the Corporation ceases to be a
Subsidiary of the Corporation by reason of the distribution of such Subsidiary’s equity securities to holders of
Common Shares, whether by means of a spin-off, split-off, re- demption, reclassification, exchange, share
dividend, share distribution, rights offering or sim- ilar transaction, which equity securities are, or when issued, will
be, listed or admitted for trad- ing on a U.S. national securities exchange.
“effective date” means, for purpose of Section (7)(a), the first date on which Common Shares trade on the
applicable exchange or in the applicable market, regular way, reflecting the relev- ant subdivision, combination or
reclassification, as applicable (provided that, for the avoidance of doubt, any alternative trading convention on the
applicable exchange or market in respect of the Common Shares under a separate ticker symbol or CUSIP
number will not be considered “regular way” for purposes of this definition).
“Eligible Market” means the New York Stock Exchange, The Nasdaq Capital Market, The Nas- daq Global Market
or The Nasdaq Global Select Market (or any of their respective successors).
“Equity Conditions” means each of the following conditions: (i) all Common Shares issuable pursuant to the terms
of these Articles of Continuance as the result of a Mandatory Conversion Date, a Preferential Dividend Date or in
respect of a conversion of Series A Preferred Shares that are subject to a Corporation Redemption, as the case
may be, shall be either (x) issuable without restrictive legends and eligible for sale by such Holder without volume
restrictions pur- suant to Rule 144 (or any successor thereto) and without the requirement to be in compliance with
Rule 144(c)(1) (or any successor thereto) and without the need for registration under any applicable federal or
state securities laws or the need for a prospectus under applicable Cana- dian securities laws or (y) eligible for
resale upon issuance pursuant to an effective Registration Statement contemplated by the Registration Rights
Agreement that is available for use (and ex- pected by the Corporation to be available for use for at least 30
consecutive calendar days after the applicable date of determination) to the extent provided in the Registration
Rights Agreement and, for the avoidance of doubt, not subject to (or expected by the Corporation to be subject to
for at least 30 consecutive calendar days after the applicable date of determina- tion) an “Allowable Grace Period”
(as defined in the Registration Rights Agreement); (ii) the Common Shares referred to in clause (i) requiring the
satisfaction of the Equity Conditions when issued shall be, listed or designated for quotation on an Eligible Market
and shall not have been suspended at such time from trading on such exchange or market; (iii) the Common
Shares referred to in clause (i) requiring the satisfaction of the Equity Conditions, when issued, shall be duly
authorized and (iv) if such Holder converted, in accordance with Section (6)(c), Series A Preferred Shares after the
delivery by Corporation of a Mandatory Conversion Notice or a Corporation Redemption Notice, the Corporation
shall have delivered to such Holder, sub-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 37 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
ject to Section (6)(e), all Common Shares required to be delivered in respect of such conver- sions pursuant to
Section (6)(c).
“Equity Conditions Failure” means that as of the applicable date of determination the Equity Conditions have not
each been satisfied (or waived in writing by such Holder); provided that the Corporation’s failure to satisfy the
Equity Condition set forth in clause (iv) of the definition of “Equity Conditions” with respect to a particular Holder
shall only be deemed an Equity Con- dition Failure with respect to such Holder (unless waived in writing by such
Holder).
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Ex-Dividend Date” means, with respect to an issuance, dividend or distribution on the Com- mon Shares, the first
date on which Common Shares trade on the applicable exchange or in the applicable market, regular way, without
the right to receive such issuance, dividend or dis- tribution (including pursuant to due bills or similar arrangements
required by the relevant share exchange). For the avoidance of doubt, any alternative trading convention on the
applic- able exchange or market in respect of the Common Shares under a separate ticker symbol or CUSIP
number will not be considered “regular way” for this purpose.
“Fair Market Value” means, with (1) respect to any security or other property, the fair market value of such security
or other property as reasonably determined in good faith by a majority of the Board, or an authorized committee
thereof, subject to any required stock exchange ap- proval and (i) after consultation with an Independent Financial
Advisor, as to any security or other property with a Fair Market Value of less than US$50,000,000, or (ii) otherwise
using an Independent Financial Advisor to provide a valuation opinion (2) with respect to U.S. dollars, the face
amount of such U.S. dollars.
“First Mandatory Conversion Period” means the period described in clause (i) of the defini- tion of “Mandatory
Conversion Period” set forth in Section (18)(uu).
“FRBNY” means the Federal Reserve Bank of New York.
“FRBNY’s Website” means the website of the FRBNY at http://www.newyorkfed.org, or any suc- cessor source.
“Fundamental Transaction” means (i) that the Corporation shall, (a) directly or indirectly, in- cluding through
Subsidiaries, Affiliates or otherwise, in one or more related transactions, con- solidate, amalgamate or merge with
or into (whether or not the Corporation is the surviving corporation) another Person, or (b) directly or indirectly,
including through Subsidiaries, Affili- ates or otherwise, in one or more related transactions, sell, assign, transfer,
convey or other- wise dispose of all or substantially all of the assets of the Corporation and its Subsidiaries on a
consolidated basis to one or more Persons other than one or more of the Corporation’s Wholly-Owned
Subsidiaries, or (c) directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more
related transactions, make, or allow a Person or Group to make, or allow the Corporation to be subject to or have
its Common Shares be subject to or party to any such Person or Group making, a purchase, tender or exchange
offer that is accepted by the holders of such number of Common Shares such that such Person or Group making
or party to, such purchase, tender or exchange offer, becomes the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act) of at least 50% of the aggregate voting power of the out-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 38 of 50
Exhibit 3.1
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
standing Common Shares or at least 50% of the aggregate voting power of the Corporation, or (d) directly or
indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, consummate
a share purchase agreement or other business com- bination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with a Person or Group (within the meaning of Section 13(d)
of the Exchange Act) whereby such Person or Group acquires such number of Common Shares such that such
Per- son or Group becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of at least
50% of the aggregate voting power of the outstanding Common Shares or at least 50% of the aggregate voting
power of the Corporation, or (e) directly or indirectly, includ- ing through Subsidiaries, Affiliates or otherwise, in one
or more related transactions, reorgan- ize, recapitalize or reclassify the Common Shares as a result of which the
Common Shares are converted into, or exchanged for, securities, cash, assets or other property or (ii) that the
Cor- poration shall, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more
related transactions, allow any Person or Group (within the meaning of Sec- tion 13(d) of the Exchange Act) to
become the “beneficial owner” (as defined in Rule 13d-3 un- der the Exchange Act) of at least 50% of the
aggregate voting power of the outstanding Com- mon Shares or at least 50% of the aggregate voting power of the
Corporation. Notwithstanding anything to the contrary in the foregoing, the consummation of the transactions
contemplated by the Merger Agreement shall not constitute a Fundamental Transaction.
“Group” means a “group” as that term is used in Section 13(d) of the Exchange Act and as defined in Rule 13d-5
thereunder.
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and
regulations promulgated thereunder, and any successor to such statute, rules or regulations.
“HSR Amount” means the number of voting securities of the Corporation that may be ob- tained by an Acquiring
Person (as defined by the HSR Act, including the ultimate parent entity and all entities included within it, and taking
into account any applicable exemptions) prior to the HSR Date, without incurring a notification obligation under the
HSR Act, with the number and class(es) of voting securities constituting the HSR Amount to be determined by the
HSR Holder in consultation with its legal counsel.
“HSR Date” means the date on which all applicable approvals, clearances or waiting periods under the HSR Act
shall have been obtained, expired or been terminated.
“HSR Holder” means a Holder that is an Acquiring Person (as defined under the HSR Act) whose ability to acquire
voting securities of the Corporation in excess of the HSR Amount is re- stricted by the HSR Act prior to the HSR
Date.
“Independent Financial Advisor” means an accounting, appraisal, investment banking firm or consultant of nationally
recognized standing; provided, however, that such firm or consultant is not an Affiliate of the Corporation.
“Issuance Date” means the Closing Date (as defined in the Securities Purchase Agreement). “Issue Price” means, per
Series A Preferred Share, US$1.00.
“Liquidation Event” means the voluntary or involuntary liquidation, dissolution or winding up
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 39 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
of the Corporation or such Subsidiaries the assets of which constitute all or substantially all of the assets of the
business of the Corporation and its Subsidiaries taken as a whole, in a single transaction or series of transactions,
or adoption of any plan for the same.
“Make-Whole Amount” means a cash amount per US$1.00 Conversion Amount of Series A Preferred Shares being
redeemed in a Change of Control Redemption determined by multiply- ing the Make-Whole Share Price applicable
to the related Change of Control by a number of ad- ditional Common Shares (the “Additional Shares”) as described
below. Such number of Addi- tional Shares shall be determined by reference to the table below (the “Make-Whole
Table”) based on the date on which the applicable Change of Control occurs or becomes effective (the “Change of
Control Effective Date”) and the Make-Whole Share Price applicable to such Change of Control.
Change of
Con- trol
Ef- fective
Date
US$59.722
US$65
US$70
US$75
US$80
US$85
US$90
US$100
US$125
US$175
US$250
US$3
February
1, 2023
0.0025100
0.0029600
0.0030456
0.0030456
0.0028600
0.0023300
0.0020400
0.0014000
0.0010400
0.0006400
0.0003900
0.0002
February
1, 2024
0.0026441
0.0030456
0.0030456
0.0030456
0.0029200
0.0023700
0.0020600
0.0014400
0.0008600
0.0004900
0.0002900
0.0001
February
1, 2025
0.0026804
0.0030456
0.0030456
0.0030456
0.0029100
0.0023700
0.0020600
0.0014100
0.0006300
0.0002900
0.0001600
0.0001
February
1, 2026
0.0024719
0.0029200
0.0030456
0.0030456
0.0028100
0.0023000
0.0019900
0.0013200
0.0003600
0.0000000
0.0000000
0.0000
February
1, 2027
0.0022427
0.0027200
0.0030456
0.0030456
0.0026500
0.0021100
0.0018600
0.0012300
0.0003500
0.0000000
0.0000000
0.0000
February
1, 2028
0.0020285
0.0025300
0.0029600
0.0029900
0.0025400
0.0020200
0.0017900
0.0011900
0.0003300
0.0000000
0.0000000
0.0000
February
1, 2029
0.0017580
0.0022800
0.0027000
0.0027400
0.0023100
0.0018200
0.0015900
0.0010700
0.0003100
0.0000000
0.0000000
0.0000
The endorsed Articles of Continuance are not complete without the Certificate of Continuance. Certified a true copy of the record
of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 40 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
February
1, 2030
0.0013647
0.0018700
0.0023200
0.0023800
0.0019600
0.0015000
0.0013100
0.0008600
0.0002600
0.0000000
0.0000000 0.0000
February
1, 2031
0.0006762
0.0011500
0.0016200
0.0017100
0.0013500
0.0010100
0.0008300
0.0005300
0.0001800
0.0000000
0.0000000 0.0000
February
1, 2032
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000 0.0000
The exact Make-Whole Share Price and Change of Control Effective Date may not be set forth in the Make-Whole Table, in
which case:
(1)
if the Make-Whole Share Price is between two such amounts in the Make-Whole Table or the Change of Control
Effective Date is between two Change of Control Effective Dates in the Make-Whole Table, the number of Additional
Shares will be determined by straight-line interpolation between the number of Additional Shares set forth for the higher
and lower Make-Whole Share Prices and the earlier and later Change of Control Effective Dates, as applicable, based on a
365-day year;
(2)
if the Make-Whole Share Price is greater than $550 (subject to adjustment in the same manner as the Make-Whole
Share Prices set forth in the column headings of the Make-Whole Table), the Make-
Whole Amount will be $0; and
(3)
if the Make-Whole Share Price is less than $59.722 (subject to adjustment in the same manner as the Make-Whole
Share Prices set forth in the column headings of the Make-Whole Table), the Make- Whole Amount will be $0.
The Make-Whole Share Prices set forth in the column headings of the Make-Whole Table shall be adjus- ted as of any date
on which the Conversion Rate is otherwise adjusted in accordance with Section (7). The adjusted Make-Whole Share
Prices shall equal the Make-Whole Share Prices applicable immedi- ately prior to such adjustment, multiplied by a fraction,
the numerator of which is the Conversion Rate immediately prior to such adjustment giving rise to the Make-Whole Share
Price adjustment and the denominator of which is the Conversion Rate as so adjusted. The number of Additional Shares
set forth in the Make-Whole Table shall be adjusted in the same manner and at the same time as the Conver- sion Rate as
set forth in Section (7).
In no event shall the Make-Whole Amount be greater than or less than the maximum and minimum values set forth in the
table above and no Make-Whole Amount shall be paid with respect to a Change of Control occurring on or after February
2, 2032.
“Make-Whole Share Price” means (i) the cash amount paid per Common Share, if the holders of Common Shares
receive only cash in the applicable Change of Control or (ii) in any other situation, the simple average of the
Weighted Average Price of the Common Shares over the five (5) consecutive Trading Day period ending on, and
including, the Trading Day immediately preceding the Change of Control Effective Date of the Change of Control.
“Mandatory Conversion Measuring Period” means the thirty (30) consecutive Trading Day
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 41 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
period following the first Trading Day of the applicable Mandatory Conversion Period during which the Mandatory
Conversion Price Condition is satisfied.
“Mandatory Conversion Period” means each of (i) the period commencing on February 1, 2026 and ending on
February 1, 2030, exclusive and (i) the period from and after February 1, 2030.
“Mandatory Conversion Price Condition” will be deemed satisfied for purposes of these Art- icles of Continuance: (i)
with respect to a Mandatory Conversion for which a Mandatory Con- version Notice is delivered in accordance
with Section (6)(d) during the First Mandatory Conver- sion Period, if the Closing Sale Price of the Common
Shares has equaled or exceeded 190% of the Conversion Price as of the Issuance Date (as adjusted for any
share dividend, share split, share combination, reclassification or similar transaction relating to the Common
Shares oc- curring after the Issuance Date pursuant to Section (7)) during twenty (20) Trading Days (whether or
not consecutive) occurring in any thirty (30) consecutive Trading Day period occur- ring on or after February 1,
2026 and ending on the Trading Day immediately preceding the Mandatory Conversion Notice Date related to
such Mandatory Conversion and (ii) with respect to a Mandatory Conversion for which a Mandatory Conversion
Notice is delivered in accord- ance with Section (6)(d) during the Second Mandatory Conversion Period, if the
Closing Sale Price of the Common Shares has equaled or exceeded 175% of the Conversion Price as of the
Issuance Date (as adjusted for any share dividend, share split, share combination, reclassifica- tion or similar
transaction relating to the Common Shares occurring after the Issuance Date pursuant to Section (7)) during
twenty (20) Trading Days (whether or not consecutive) occurring in any thirty (30) consecutive Trading Day period
occurring on or after February 1, 2030 and ending on the Trading Day immediately preceding the Mandatory
Conversion Notice Date re- lated to such Mandatory Conversion.
“Merger Agreement” means that certain Agreement and Plan of Merger and Reorganization, dated as of November
7, 2022, by and among the Corporation, IAA, Inc., a Delaware corpora- tion, and the other parties thereto, as may
be amended, amended and restated, supplemented or otherwise modified from time to time.
“Minimum Ownership Threshold” means twenty five percent (25.0%) of the Series A Pre- ferred Shares outstanding
as of the applicable date of determination.
“Offer to Repurchase Percentage” means such percentage of Common Shares being re- deemed or repurchased by
the Corporation (including Common Shares into which Junior Shares, options or warrants, which are being so
redeemed or repurchased, are convertible, ex- changeable or exercisable) out of the total number of Common
Shares (including Common Shares into which such Junior Shares, options or warrants of the Corporation are
convertible, exchangeable or exercisable, which are so being redeemed or repurchased) issued and out- standing
(or in respect of any such Junior Shares, options or warrants, which are so being re- deemed or repurchased,
which are reserved for issuance upon conversion, exchange or exer- cise thereof) as of the applicable time of
determination.
“Offer to Repurchase Price” means the sum of (x) the amount of accrued and unpaid Di- vidends, if any, on the
Series A Preferred Shares subject to the applicable Offer to Repurchase (and any accrued and unpaid dividends
thereon accrued pursuant to Section (5)(c)) and (y) the greater of (1) the Conversion Amount of the Series A
Preferred Shares subject to the applicable
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 42 of 50
Exhibit 3.1
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Offer to Repurchase and (2) the amount set forth in clause (1) increased by the same percent- age as the
premium paid to the holders of each Common Share (including Common Shares into which Junior Shares, options
or warrants of the Corporation are convertible, exchangeable or exercisable) giving rise to the applicable Offer to
Repurchase determined based on the pur- chase price relative to the Closing Sale Price of the Common Shares
on the Trading Day the Corporation purchases such Common Share, Junior Share, option or warrant (unless such
pur- chase occurs on a day that is not a Trading Day, in which case the Closing Sale Price from the immediately
preceding Trading will be used in the determination of such premium). To the ex- tent there is more than one Offer
to Repurchase Event in a Calendar Quarter, the premium re- ferred to in the immediately preceding sentence will
be based on a weighted average calcula- tion determined by the Corporation in good faith.
“Offer to Repurchase Pro Rata Portion” means, for each Holder, a fraction the numerator of which is the number of
Series A Preferred Shares held by such Holder at the applicable time of determination and the denominator of
which is the total number of Series A Preferred Shares outstanding at the applicable time of determination. In the
event that a Holder shall sell or oth- erwise transfer any of its Series A Preferred Shares, the transferee shall be
allocated a pro rata portion of the transferring Holder’s Offer to Repurchase Pro Rata Portion.
“open of business” means 9:00 a.m. (New York City time).
“Person” means an individual, a limited liability company, a partnership (limited or general), a joint venture, a
corporation, a trust, an unincorporated organization, any other entity and a government or any department or
agency thereof.
“Principal Market” means the New York Stock Exchange (or its successor).
“record date” means, with respect to any dividend, distribution or other transaction or event in which the holders of
the Common Shares have the right to receive any cash, securities or other property or in which the Common
Shares are exchanged for or converted into any combina- tion of cash, securities or other property, the date fixed
for determination of holders of the Common Shares entitled to receive such cash, securities or other property
(whether such date is fixed by the Board or by statute, contract or otherwise).
“Registration Rights Agreement” means that certain registration rights agreement dated as of the Subscription Date
by and among the Corporation and the initial holders of the Series A Preferred Shares relating to, among other
things, the registration of the resale of the Common Shares issuable pursuant to the terms of these Articles of
Continuance, as may be amended, amended and restated, supplemented or otherwise modified from time to time.
“Registration Statement” shall have the meaning ascribed to such term in the Registration Rights Agreement.
“Required Holders” means the Holders representing at least a majority of the aggregate Series A Preferred Shares
then outstanding and shall include the Designee so long as the Designee and/or any of its Affiliates is a Holder
who beneficially owns, in the aggregate, at least the Min- imum Ownership Threshold.
“Second Mandatory Conversion Period” means the period described in clause (ii) of the definition of “Mandatory
Conversion Period” set forth in Section (18)(uu).
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 43 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
“Securities Act” means the Securities Act of 1933, as amended.
“Securities Purchase Agreement” means the Securities Purchase Agreement, dated as of the Subscription Date, by
and among the Corporation and the initial holders of the Series A Pre- ferred Shares, relating to, among other
things, the purchase and sale of the Series A Preferred Shares, as may be amended, amended and restated,
supplemented or otherwise modified from time to time.
“Subscription Date” means January 22, 2023.
“Subsidiaries” means any joint venture or entity in which the Corporation, directly or indirectly, owns more than 50%
of the voting power of shares of capital or other equity or similar interest, including any subsidiaries formed or
acquired after the Subscription Date.
“Trading Day” means any day on which (i) the Common Shares (or other security for which a Closing Sale Price or
other price must be determined) are traded on the Principal Market, or, if the Principal Market is not the principal
U.S. trading market for the Common Shares (or such other security) on such day, then on another Eligible Market
on which the Common Shares (or such other security) are then traded or, if the Common Shares (or such other
security) are not then listed on an Eligible Market, on the principal other U.S. market on which the Common
Shares (or such other security) are then traded and (ii) a Closing Sale Price (or such other price) is for the
Common Shares (or such other security) is available on such securities exchange or
market; provided that if the Common Shares (or such other security) are not so listed or traded, “Trading Day”
means a Business Day.
“Transfer Agent” means Computershare Investor Services Inc. or such other agent or agents of the Corporation as
may be designated by the Board as the transfer agent for the Common Shares.
“Weighted Average Price” means per share volume-weighted average price as displayed un- der the heading
“Bloomberg VWAP” on Bloomberg page “RBA AQR” (or its equivalent successor if such page is not
available) (or the applicable Bloomberg page with respect to the common shares or other equity interests referred
to in the definition “FMV” in Section (7)(a)(iv)) in respect of the period from the scheduled open of trading until the
scheduled close of trad- ing of the primary trading session on such Trading Day (or if such volume-weighted
average price is unavailable, the market value of one Common Share (or such other common share or equity
interest referred to in the definition “FMV” in Section (7)(a)(iv)) on such Trading Day reas- onably determined,
using a volume-weighted average method, by a nationally recognized inde- pendent investment banking firm
retained for this purpose by the Corporation). The “Weighted Average Price” shall be determined without regard to
after-hours trading or any other trading outside of the regular trading session trading hours.
“Wholly-Owned Subsidiary” means, with respect to any Person, any direct or indirect Subsidi- ary of such Person,
except that, solely for purposes of this definition, the reference to “more than 50%” in the definition of “Subsidiary”
shall be deemed replaced by a reference to “100%,” the calculation of which shall exclude nominal amounts of the
voting power of shares of capital stock or other interests in the relevant Subsidiary not held by such Person to the
extent re- quired to satisfy local minority interest requirements outside of the United States.
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 44 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
JUNIOR PREFERRED SHARES
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Junior Preferred shares (the “Ju- nior Preferred Shares”),
as a class in the capital of the Corporation.
Directors’ Authority to Issue in One or More Series. The directors of the Corporation may issue the Junior Preferred Shares at any time and from time
to time in one or more series. Before any shares of a particular series are issued, the directors of the Corpor- ation shall fix the number of shares that
will form such series and shall determine, subject to the limitations set out in the art- icles, the designation, rights, privileges, restrictions and
conditions to be attached to the Junior Preferred Shares of such series, including, but without in any way limiting or restricting the generality of the
foregoing, the rate or rates, amount or methods of calculation of dividends thereon, the currency or currencies of payment of dividends, the time and
place of payment of di- vidends, the consideration and the terms and conditions of any purchase for cancellation, retraction or redemption rights (if
any), the conversion or exchange rights attached thereto (if any), the voting rights attached thereto (if any) and the terms and conditions of any share
purchase plan or sinking fund with respect thereto. Before the issue of the first shares of a series, the directors shall send to the Director (as defined in
the Business Corporations Act (Ontario)) articles of amendment containing a de- scription of such series including the designation, rights, privileges,
restrictions and conditions determined by the directors.
Ranking of Junior Preferred Shares. No rights, privileges, restrictions or conditions attached to a series of Junior Preferred Shares shall confer upon a
series a priority in respect of dividends or return of capital over any other series of Junior Preferred Shares. The Junior Preferred Shares shall be
entitled, subject to the prior rights of the holders of the Senior Preferred Shares, to priority over the Common Shares of the Corporation and over any
other shares ranking junior to the Junior Preferred Shares with re- spect to priority in the payment of dividends and in the distribution of assets in the
event of the liquidation, dissolution or wind- ing-up of the Corporation, whether voluntary or involuntary, or any other distribution of the assets of the
Corporation among its shareholders for the purpose of winding up its affairs. If any cumulative dividends or amounts payable or return of capital in re-
spect of a series of Junior Preferred Shares are not paid in full, the Junior Preferred Shares of all series shall participate rateably in respect of such
dividends, including accumulations, if any, in accordance with the sums that would be payable on such shares if all such dividends were declared and
paid in full and in respect of any repayment of capital in accordance with the sums that would be payable on such repayment of capital if all sums so
payable were paid in full; provided, however, that in the event of there being insufficient assets to satisfy in full all such claims as aforesaid, the claims
of the holders of the Junior Preferred Shares with respect to repayment of capital shall first be paid and satisfied and any assets remaining thereafter
shall be applied towards the payment and satisfaction of claims in respect of dividends. The Junior Preferred Shares of any series may also be given
such other preferences not consistent with clause (1) to (4) hereof over the Common Shares and over any other shares ranking junior to the Junior
Preferred Shares as may be determined in the case of such series of Junior Preferred Shares.
Voting Rights. Except as herein referred to or as otherwise provided by law or in accordance with any voting rights which may from time to time be
attached to any series of Junior Preferred Shares, the holders of the Junior Preferred Shares as a class shall not be entitled as such to receive notice
of, to attend or to vote at any meeting of the shareholders of the Corporation.
Approval of Holders of Junior Preferred Shares. The rights, privileges, restrictions and conditions attaching to the Junior Preferred Shares as a class
may be added to, changed or removed but only with the approval of the holders of Junior Preferred Shares given as hereinafter specified.
The approval of the holders of Junior Preferred Shares to add to, change or remove any right, privilege, restriction or condition attaching to the Junior
Preferred Shares as a class or of any other matter requiring the consent of the holders of the Junior Pre- ferred Shares as a class may be given in
such manner as may then be required by law, subject to a minimum requirement that such approval be given by resolution passed by the affirmative
vote of at least 2/3 of the votes cast at a meeting of the holders of Junior Preferred Shares duly called for that purpose. The formalities to be observed
in respect of the giving of notice of any such meeting or any adjourned meeting and the conduct thereof shall be those from time to time prescribed by
the Business Corpora- tions Act (Ontario) (as from time to time amended, varied or replaced) and the by-laws of the Corporation with respect to meet-
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 45 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
ings of shareholders. On every poll taken at a meeting of holders of Junior Preferred Shares as a class, or at a joint meeting of the holders of two or
more series of Junior Preferred Shares, each holder of Junior Preferred Shares entitled to vote thereat shall have 1 vote in respect of each Junior
Preferred Share held by him/her.
RB Global, Inc.
CONVERSION NOTICE
Reference is made to the Articles of Continuance of RB Global, Inc. (the “Articles of Continuance”) creating the Series A Senior Preferred Shares. In
accordance with and pursuant to the Articles of Continuance, the undersigned hereby elects to convert the number of Series A Senior Preferred
Shares (the “Series A Preferred Shares”) of RB Global, Inc., a corporation continued under the laws of the Province of Ontario (the “Corporation”),
indicated below into Common Shares (the “Common Shares”) of the Corporation, as of the date specified below.
Date of Conversion: Number of Series A Preferred Shares to be converted: Tax ID Number (If
applicable):
Please confirm the following information: Conversion Rate: Number of Common Shares to be issued:
Please issue the Common Shares into which the Series A Preferred Shares are being converted to the Holder, or for its benefit, as follows:
· □ To the undersigned’s account on the records of the Transfer Agent
Issue to: Address: Telephone Number: Tax Identification Number:
□ If the securities are unrestricted, check here if requesting delivery by Deposit/Withdrawal at Custodian as follows:
DTC Participant: DTC Number: Account Number:
Note: Initially, the common shares issued upon conversion will include restrictive legends and will not be able to be processed through DTC.
Payment Instructions for cash payment in lieu of fractional shares:
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Exhibit 3.1
Director/Registrar, Ministry of Public and Business Service Delivery Page 46 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Authorization:
By: Title: Dated:
Account Number (if electronic book entry transfer): Transaction Code Number (if electronic book entry
transfer):
· [NOTE TO HOLDER -- THIS FORM MUST BE SENT CONCURRENTLY TO TRANSFER AGENT]
ACKNOWLEDGMENT
The Corporation hereby acknowledges this Conversion Notice and hereby directs [Computershare Investor Services Inc.] [OR IF COMPUTERSHARE
INVESTOR SERVICES INC. NO LONGER SERVES AS THE CORPORATION’S TRANSFER AGENT, INSERT THE NAME
OF THE CORPORATION’S CURRENT TRANSFER AGENT] to issue the above indicated number of Common Shares in accordance with the
Standing Transfer Agent Instructions dated [●], 20[●] from the Corporation and acknowledged and agreed to by [Com- putershare Investor
Services Inc.] [OR IF COMPUTERSHARE INVESTOR SERVICES INC. NO LONGER SERVES AS THE CORPORA- TION’S TRANSFER AGENT, INSERT
THE NAME OF THE CORPORATION’S CURRENT TRANSFER AGENT].
RB GLOBAL, INC.
By: Name: Title:
12.
The issue, transfer or ownership of shares is/is not restricted and the restrictions (if any) are as follows. If none, enter "None":
N/A
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
Exhibit 3.1
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 47 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
13. Other provisions
N/A
14.
The corporation is to be continued under the Business Corporations Act to the same extent as if it had been incorporated under this Act.
15. The corporation has complied with subsection 180(3) of the Business Corporations Act.
The articles have been properly executed by the required person(s).
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 48 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Supporting Document -Constating Document from Governing Jurisdiction
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 49 of 50
Exhibit 3.1
BCA - Articles of Continuance - RB GLOBAL, INC. - OCN:1001014884 - September 24, 2024
Supporting Information - Nuans Report Information
Nuans Report Reference # 122329043
Nuans Report Date September 16, 2024
Exhibit 3.1
The endorsed Articles of Continuance are not complete without the Certificate of
Continuance. Certified a true copy of the record of the Ministry of Public and Business Service Delivery.
,
Director/Registrar, Ministry of Public and Business Service Delivery Page 50 of 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Ministère des Services au public et
aux entreprises
Statuts de maintien
Loi sur les sociétés par actions
1. Dénomination sociale
RB Global, Inc.
2. Date de constitution/fusion
12 décembre 1997
3. Nom du territoire que la société quitte
Canada - Fédéral
4. Le maintien a été autorisé par le territoire du domicile le
16 septembre 2024
5. La société est maintenue en Ontario sous le nom
RB GLOBAL, INC.
6. Adresse du siège social
66 Wellington Street West, Unit 5300, Toronto, Ontario, M5K1E6, Canada
7. Nombre d’administrateurs
Minimum ou maximum Min. 3 / Max. 12
Exhibit 3.1
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 1 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
8. L’administrateur est/Les administrateurs sont:
Nom complet BRIAN BALES
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Adresse aux fins de signification États-Unis
Nom complet ADAM DEWITT
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Adresse aux fins de signification États-Unis
Nom complet ROBERT GEORGE ELTON
9500 Glenlyon Parkway, Burnaby, Colombie-Britannique,
Adresse aux fins de signification V5J0C6, Canada
Nom complet JAMES KESSLER
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Adresse aux fins de signification États-Unis
Nom complet GREGORY MORRISON
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Adresse aux fins de signification États-Unis
Nom complet TIMOTHY O'DAY
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Adresse aux fins de signification États-Unis
Nom complet SARAH RAISS
9500 Glenlyon Parkway, Burnaby, Colombie-Britannique,
Adresse aux fins de signification V5J0C6, Canada
Nom complet MICHAEL SIEGER
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Adresse aux fins de signification États-Unis
Nom complet JEFFREY C. SMITH
2 Westbrook Corporate Center 500, Westchester, Illinois, 60154,
Adresse aux fins de signification États-Unis
Nom complet DEBBIE STEIN
9500 Glenlyon Parkway, Burnaby, Colombie-Britannique,
Adresse aux fins de signification V5J0C6, Canada
Nom complet CAROL STEPHENSON
9500 Glenlyon Parkway, Burnaby, Colombie-Britannique,
Adresse aux fins de signification V5J0C6, Canada
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 2 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
9. Restrictions, le cas échéant, liées aux activités ou aux pouvoirs que peut exercer la société : S’il n’y en a aucune, inscrire
« Aucune » :
N/A
10. Catégories et nombre maximal, s’il y a lieu, d’actions que la société est autorisée à émettre:
The Corporation is authorized to issuance: (i) an unlimited number of Common shares; (ii) an unlimited number of Preferred shares designated as
Junior Preferred shares, issuable in series; and (iii) an unlimited number of Preferred shares, designated as Senior Preferred shares, issuable in
series of which 485,000,000 are designated as Series A Senior Preferred shares.
11.
Droits, privilèges, restrictions et conditions, le cas échéant, rattachés à chaque catégorie d’actions et pouvoirs des administrateurs relatifs à chaque
catégorie d’actions qui peuvent être émises en série : S’il n’y a qu’un seul type d’actions, inscrire « Ne s’applique pas ».
COMMON SHARES
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Common Shares (the “Common Shares”) in the capital of the
Corporation.
Voting Rights. The Common Shares shall entitle the holders thereof to notice of, to attend and to 1 vote for each Common Share held at all meetings
of the shareholders, except meetings at which only holders of a specified class or series of shares of the Cor- poration are entitled to vote separately
as a class or series.
Dividend Rights. Subject to the prior rights of the holders of the Senior Preferred Shares, the Junior Preferred Shares and any other shares ranking
senior to the Common Shares with respect to priority in the payment of dividends, the holders of the Com- mon Shares shall be entitled to receive and
the Corporation shall pay thereon dividends if, as and when declared by the board of directors of the Corporation out of moneys or assets of the
Corporation properly applicable to the payment of dividends in such amount and payable in such manner as the board of directors may from time to
time determine. Subject to the rights of the hol- ders of any other class of shares of the Corporation entitled to receive dividends in priority to or with
the holders of the Common Shares, the board of directors may in their sole discretion declare dividends on the Common Shares to the exclusion of
any other class of shares of the Corporation.
Rights upon Dissolution. Subject to the prior rights of the holders of the Senior Preferred Shares, the Junior Preferred Shares and any other shares
ranking senior to the Common Shares with respect to priority in the distribution of assets, the holders of the Common Shares shall be entitled to
receive the remaining property and assets of the Corporation in the event of the liquidation, dissolution or winding-up of the Corporation, whether
voluntary or involuntary, or any other distribution of the assets of the Cor- poration among its shareholders for the purpose of winding up its affairs,
provided that such remaining property and assets shall be paid or distributed equally share for share to the holders of the Common Shares at the time
outstanding without prefe- rence or priority.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 3 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
SENIOR PREFERRED SHARES
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Senior Preferred shares (the “Se- nior Preferred
Shares”), as a class in the capital of the Corporation.
Directors’ Authority to Issue in One or More Series. The directors of the Corporation may issue the Senior Preferred Shares at any time and from time
to time in one or more series. Before any shares of a particular series are issued, the directors of the Corporation shall fix the number of shares that
will form such series and shall determine, subject to the limitations set out in the articles, the designation, rights, privileges, restrictions and conditions
to be attached to the Senior Preferred Shares of such se- ries, including, but without in any way limiting or restricting the generality of the foregoing,
the rate or rates, amount or method or methods of calculation of dividends thereon, the currency or currencies of payment of dividends, the time and
place of pay- ment of dividends, the consideration and the terms and conditions of any purchase for cancellation, retraction or redemption rights (if
any), the conversion or exchange rights attached thereto (if any), the voting rights attached thereto (if any) and the terms and conditions of any share
purchase plan or sinking fund with respect thereto. Before the issue of the first shares of a se- ries, the directors shall send to the Director (as defined
in the Business Corporations Act (Ontario) articles of amendment contai- ning a description of such series including the designation, rights, privileges,
restrictions and conditions determined by the direc- tors.
Ranking of Senior Preferred Shares. No rights, privileges, restrictions or conditions attached to a series of Senior Preferred Shares shall confer upon a
series a priority in respect of dividends or return of capital over any other series of Senior Preferred Shares. The Senior Preferred Shares shall be
entitled to priority over the Junior Preferred Shares and Common Shares of the Cor- poration and over any other shares ranking junior to the Senior
Preferred Shares with respect to priority in the payment of divi- dends and the distribution of assets in the event of the liquidation, dissolution or
winding-up of the Corporation, whether volun- tary or involuntary, or any other distribution of the assets of the Corporation among its shareholders for
the purpose of winding up its affairs. If any cumulative dividends or amounts payable on a return of capital in respect of a series of Senior Preferred
Shares are not paid in full, the Senior Preferred Shares of all series shall participate rateably in respect of such dividends, inclu- ding accumulations, if
any, in accordance with the sums that would be payable on such shares if all such dividends were declared and paid in full, and in respect of any
repayment of capital in accordance with the sums that would be payable on such repay- ment of capital if all sums so payable were paid in full;
provided, however, that in the event of there being insufficient assets to satisfy in full all such claims as aforesaid, the claims of the holders of the
Senior Preferred Shares with respect to repayment of capital shall first be paid and satisfied and any assets remaining thereafter shall be applied
towards the payment and satisfaction of claims in respect of dividends. The Senior Preferred Shares of any series may also be given such other
preferences not incon- sistent with clauses (1) to (4) hereof over the Junior Preferred Shares and Common Shares and over any other shares ranking
ju- nior to the Senior Preferred Shares as may be determined in the case of such series of Senior Preferred Shares.
Voting Rights. Except as hereinafter referred to or as otherwise provided by law or in accordance with any voting rights which may from time to time
be attached to any series of Senior Preferred Shares, the holders of the Senior Preferred Shares as a class shall not be entitled as such to receive
notice of, to attend or to vote at any meeting of the shareholders of the Corporation.
Approval of Holdings of Senior Preferred Shares. The rights, privileges, restrictions and conditions attaching to the Senior Prefer- red Shares as a
class may be added to, changed or removed but only with the approval of the holders of Senior Preferred Shares given as hereinafter specified.
The approval of the holders of Senior Preferred Shares to add to, change or remove any right, privilege, restriction or condition attaching to the Senior
Preferred Shares as a class or any other matter requiring the consent of the holders of the Senior Prefer- red Shares as a class may be given in such
manner as may then be required by law, subject to a minimum requirement that such approval be given by resolution passed by the affirmative vote of
at least 2/3 of the votes cast at a meeting of the holders of Se- nior Preferred Shares duly called for that purpose. The formalities to be observed in
respect of the giving of notice of any such meeting or any adjourned meeting and the conduct hereof shall be those from time to time prescribed by
the Business Corpora-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 4 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
tions Act (Ontario) (as from time to time amended, varied or replaced) and the by-laws of the Corporations with respect to mee- tings of shareholders.
On every poll taken at a meeting of holders of Senior Preferred Shares as a class, or at a joint meeting of the holders of two or more series of Senior
Preferred Shares, each holder of Senior Preferred Shares entitled to vote thereat shall have 1 vote in respect of each Senior Preferred Share held by
him/her.
SERIES A SENIOR PREFERRED SHARES
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Series A Senior Preferred shares (the “Series A
Preferred Shares”) in the capital of the Corporation. Capitalized terms not defined in Sections (1) through (17) are defined in Section (18) hereof.
Designation and Amount. There shall be a series of Senior Preferred Shares of the Corporation designated as the “Series A Senior Preferred Shares”
and the number of shares constituting such series shall be four hundred eighty five million (485,000,000) shares (each a “Series A Preferred Share”).
Ranking. The Series A Preferred Shares shall rank, with respect to rights as to dividends, distributions, redemptions and pay- ments upon the
liquidation, dissolution and winding up of the Corporation (a) senior to all of the Junior Preferred Shares, Com- mon Shares and any other class or
series of capital shares of the Corporation, hereafter issued or authorized, the terms of which do not expressly provide that such class or series ranks
senior to or on a parity with the Series A Preferred Shares as to divi- dends, distributions, redemptions and payments upon the liquidation, dissolution
and winding up of the Corporation (such shares being referred to hereinafter collectively as “Junior Shares”), (b) on a parity basis with each other class
or series of capital shares hereafter issued or authorized, the terms of which expressly provide that such class or series ranks on a parity basis with
the Series A Preferred Shares as to dividends, distributions, redemptions and payments upon the liquidation, dissolution and winding up of the
Corporation (such shares being referred to hereinafter collectively as “Pari Passu Shares”), and (c) on a junior basis with each other class or series of
capital shares hereafter issued or authorized, the terms of which expressly provide that such class or series ranks on a senior basis to the Series A
Preferred Shares as to dividends, distributions, redemptions and pay- ments upon the liquidation, dissolution and winding up of the Corporation (such
shares being referred to hereinafter collectively as “Senior Shares”). Notwithstanding anything to the contrary in these Articles of Continuance (these
“Articles of
Continuance”), the Corporation shall have the right to create and issue Series A-1 Preferred Shares and Series A-2 Preferred
Shares (each as defined below) pursuant to Section (10) without the consent of the Holders.
No Maturity or Sinking Fund. The Series A Preferred Shares shall have no stated maturity and will not be subject to any sinking fund.
Liquidation. In the event of a Liquidation Event, holders of Series A Preferred Shares (each, a “Holder” and collectively, the “Hol- ders”) shall be entitled
to receive in cash out of the assets of the Corporation legally available therefor, whether from capital or from earnings available for distribution to its
shareholders (the “Liquidation Funds”) upon such Liquidation Event, before any
amount shall be paid to the holders of Junior Shares, but subject to the rights of Senior Shares and Pari Passu Shares, an amount per Series A
Preferred Share equal to the greater of (i) the Conversion Amount per Series A Preferred Share and accrued and un- paid Dividends thereon, if any
(and any accrued and unpaid dividends thereon accrued pursuant to Section (5)(c) and (ii) the amount that would have been received had such Series
A Preferred Shares and accrued and unpaid Dividends thereon, if any (and any accrued and unpaid dividends thereon accrued pursuant to Section (5)
(c)) been converted immediately prior to such Li- quidation Event at the then effective Conversion Rate (without regard to any limitations on
conversion); provided that, if the Li- quidation Funds are insufficient to pay the full amount due to the Holders and holders of shares of Pari Passu
Shares, if any, then each Holder and each holder of any such Pari Passu Shares shall receive a percentage of the Liquidation Funds equal to the full
amount of Liquidation Funds that would be payable to such Holder or holder of Pari Passu Shares as a liquidation preference in accordance with their
respective rights set out in the Articles from time to time, as a percentage of the full amount of Liquidation
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 5 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Funds that would be payable to all Holders and holders of Pari Passu Shares in accordance with their respective rights set out in the Articles from time
to time.
Dividends.
Preferential Dividends.
From and after the Issuance Date, the Holders of record as they appear on the books of the Corporation
on February 15, May 15, August 15 and November 15 of each ca- lendar year following the Issuance
Date (each such date, a “Preferential Dividend
Record Date”) shall be entitled to receive, to the fullest extent permitted by law and
out of funds lawfully available therefor, before any dividends shall be declared, set apart for or paid upon
the Common Shares or any other Junior Shares, dividends per Series A Preferred Share on the
applicable Preferential Dividend Date (as defined be- low) in arrears for the previous Calendar Quarter
equal to an amount calculated at 5.50% per annum (the “Preferential Dividend Rate”) on the Issue Price of
each such Series A Preferred Share computed on the basis of a 360-day year and twelve 30-day months
(the “Preferential Dividends”). For the avoidance of doubt, the first Preferen- tial Dividends to be paid by
the Corporation on March 15, 2023 shall be prorated for the period starting on the Issuance Date through
such Preferential Dividend Date.
Preferential Dividends shall be payable on March 15, June 15, September 15 and De- cember 15 of
each calendar year following the Issuance Date, or, if any such date falls on a day that is not a Business
Day, the next day that is a Business Day (each such date, a “Preferential Dividend Date”).
Preferential Dividends shall be payable on each Preferential Dividend Date, to the Holders of record on
the related Preferential Dividend Record Date, in whole or in part, in cash (“Cash Preferential Dividend”) or,
so long as there is no Equity Condi- tions Failure in respect of the Preferential Dividend Shares occurring
on the applicable Preferential Dividend Date (subject to waiver of any such Equity Conditions Failure in
accordance with clause (v) below) by any Holder with respect to such Holder only, in Common Shares
(the “Preferential Dividend Shares”), at the Corporation’s election, subject to any required stock exchange
approval to issue such Common Shares.
The Corporation shall give written notice (a “Preferential Dividend Election Notice”)
to each Holder on or prior to the fifteenth (15th) Trading Day immediately prior to the applicable
Preferential Dividend Date (the date such notice is delivered to the Hol- ders, the “Preferential Dividend
Notice Date”) indicating whether it elects to pay Preferential Dividend on any Preferential Dividend Date in
Cash Preferential Dividend, in Preferential Dividend Shares or a combination thereof (and if a
combination, the proportion that will be paid in Cash Preferential Dividend), which election shall be the
same for all Holders. If the Corporation does not give a Preferential Election Notice in respect of a
Preferential Dividend Date in accordance with the immediately preceding sentence, the Corporation will
be deemed to have elected Cash Preferential Dividend
in respect of the Preferential Dividends due on such Preferential Dividend Date.
If the Corporation elects the payment of applicable Preferential Dividend in Preferen- tial Dividend
Shares, in whole or in part, in respect of a Preferential Dividend Date,
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 6 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
and an Equity Conditions Failure occurs at any time prior to such Preferential Divi- dend Date that the
Corporation expects will last through such Preferential Dividend Date (which is not waived in writing by
such Holder), the Corporation shall provide each Holder a written notice to that effect by no later than the
Trading Day immedia- tely following the date upon which the Corporation has knowledge of such Equity
Conditions Failure, indicating that unless such Holder waives the Equity Conditions Failure in writing, the
applicable portion of Preferential Dividend as to which such Hol- der did not waive the Equity Conditions
Failure shall be paid as Cash Preferential Divi- dend.
If any portion of Preferential Dividend for a particular Preferential Dividend Date shall be paid in
Preferential Dividend Shares, then on the applicable Preferential Dividend Date, the Corporation shall
issue to the Holder, such number of Common Shares equal to (a) the amount of Preferential Dividend
payable on the applicable Preferen- tial Dividend Date in Preferential Dividend Shares divided by (b)
97% of the simple average of the daily Weighted Average Prices of the Common Shares on each
Trading Day during the ten (10) consecutive Trading Days immediately following the appli- cable
Preferential Dividend Notice Date. Notwithstanding anything herein to the contrary, if the price set forth in
clause (b) of the immediately preceding sentence is less than US$59.722 (as adjusted for any share
dividend, share split, share combina- tion, reclassification or similar transaction relating to the Common
Shares occurring after the Subscription Date) or less than the minimum price required such that the
Common Shares are deemed to be issued at or above the market price or otherwise not requiring
shareholder approval by the Toronto Stock Exchange (or its successor), then the Corporation shall be
required to pay the applicable Preferential Dividends on the applicable Preferential Dividend Payment
Date in cash as a Cash Preferential Divi- dend. All Preferential Dividend Shares shall be fully paid and
nonassessable Common Shares (rounded in accordance with Section (6)(b)). By written notice to all
Holders, the Corporation may irrevocably elect to eliminate its ability to pay Preferential Divi- dends with
Preferential Dividend Shares (i) unless and until it receives the approval of its shareholders for the
issuance of Common Shares in excess of the Exchange Cap (as defined below) or (ii) subject to no
conditions.
Participating Dividends. From and after the Issuance Date, the Holders on the record date fixed for holders of
Common Shares for dividends or distributions in a Calendar Quarter (or, in the event no such date is fixed in such
Calendar Quarter, on the Preferential Dividend Record Date occurring in such Calendar Quarter) shall be entitled
to receive, to the fullest extent permitted by law and out of funds lawfully available therefor, concurrently with the
payment of regular quarterly cash dividends (or, in the event no such regular quarterly cash dividends are made,
on the Preferential Dividend Date) paid to the holders of Common Shares, the greater of (A) such regular quarterly
cash dividends paid to the holders of Common Shares to the same extent as if such Holders had converted the
Series A Preferred Shares into Common Shares (without regard to any limitations on conversion) and had held
such Common Shares on such record date (or, in the event no such date is fixed in such Calendar Quarter, on the
Preferential Dividend Record Date occurring in such Calendar Quarter) and (B) US$0.27 (as adjusted for any
share dividend, share split, share combination, reclassification or similar transaction relating to the Common
Shares occurring after the Subscription Date) per Common Share issuable upon conversion of the Series A
Preferred Shares pursuant to Section (6)(a) on the applicable record
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 7 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
date for payment of such dividend (or, in the event no such date is fixed in such Calendar Quarter, on the
Preferential Dividend Record Date occurring in such Calendar Quarter) (wi- thout regard to any limitations on
conversion) (the “Participating Dividends” and together
with the Preferential Dividends, the “Dividends”). For the avoidance of doubt, Holders shall be
entitled to receive to the fullest extent permitted by law and out of funds lawfully available the- refor the
Participating Dividend set forth in Section (5)(b)(B) each Calendar Quarter regardless of whether a regular
quarterly cash dividend is declared on the Common Shares. Notwithstan- ding anything to the contrary set forth in
this Section (5)(b), in no event shall the Participating Dividend include any special cash dividend payable to the
holders of Common Shares, inclu- ding the special cash dividend, if any, to be declared and paid in connection
with the transac-
tions contemplated by the Merger Agreement (the “IAA Special Dividend”); provided, however,
for the avoidance of doubt, that special cash dividends, including, without limitation, the IAA Special Dividend, shall
adjust the Conversion Rate in accordance with Section (7)(a)(iii).
General. The Dividends shall be paid by the Corporation to the fullest extent permitted by ap- plicable law and out
of funds lawfully available therefor. Dividends on the Series A Preferred Shares shall commence accruing on the
Issuance Date, shall be cumulative and shall continue to accrue without interest whether or not declared and
whether or not in any fiscal year there shall be net profits or surplus available for the payment of Dividends in such
fiscal year, so that if in any fiscal year or years, Dividends in whole or in part are not paid upon the Series A Pre-
ferred Shares as required by this Section (5) for any reason, including, without limitation, be- cause there are no
funds legally available therefor, unpaid Dividends shall accumulate thereon. If the Corporation fails to declare and
pay full Preferential Dividends on the Series A Preferred Shares on any Preferential Dividend Date as provided in
this Section (5), then any Preferential Dividends payable on such Preferential Dividend Date on the Series A
Preferred Shares but not paid shall accrue an additional dividend thereon at a rate equal to the Preferential
Dividend Rate, computed on the basis of a 360-day year and twelve 30-day months, from and including the
applicable Preferential Dividend Date to but excluding the day on which the Corporation shall have paid in
accordance with this Section (5) all Dividends on which the Series A Preferred Shares that are then in arrears or
until the conversion, redemption or repurchase of the appli- cable Series A Preferred Shares. The Corporation
shall not (either directly or through any of its Subsidiaries) redeem or repurchase any Pari Passu Shares or Junior
Shares, unless the Corpo- ration has declared all Dividends on the Series A Preferred Shares that have accrued
through the Preferential Dividend Record Date immediately preceding the date of such redemption or repurchase
and paid all Dividends on the Series A Preferred Shares that are payable through the Preferential Dividend Date
immediately preceding the date of such redemption or repur- chase other than redemptions or repurchases of (i)
Series A Preferred Shares, Series A-1 Pre- ferred Shares or Series A-2 Preferred Shares, as applicable, (ii) Junior
Shares in the ordinary course of business in connection with any employment contract, equity incentive plan,
benefit plan or other similar arrangement with or for the benefit of current or former employees, offi- cers, directors
or consultants; provided that not more than US$10.0 million is paid by the Cor- poration to redeem or repurchase
Junior Shares in accordance with this clause (ii) in any 12 consecutive month period; (iii) Pari Passu Shares or
Junior Shares as a result of an exchange or conversion of any class or series of Pari Passu Shares or Junior
Shares for any other class or se- ries of Pari Passu Shares (in the case of Pari Passu Shares) or Junior Shares (in
the case of Pari Passu Shares or Junior Shares); and (iv) fractional interests in Pari Passu Shares or Junior
Shares pursuant to the conversion or exchange provisions of such Pari Passu Shares or Junior Shares or the
security being converted or exchanged.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 8 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Conversion of Series A Preferred Shares into Common Shares. Series A Preferred Shares shall be convertible into Common Shares on the terms and
conditions set forth in this Section (6).
Holder’s Conversion Right. Subject to the provisions of Section (6)(e), at any time or times on or after the Issuance
Date, any Holder shall be entitled to convert any Series A Preferred Shares into fully paid and nonassessable
Common Shares in accordance with this Section (6) at the Conversion Rate (as defined below).
Conversion. The number of Common Shares issuable upon conversion by a Holder of Series A Preferred Shares
pursuant to Section (6)(a) shall be determined by multiplying (x) the Conver- sion Amount in respect of the Series
A Preferred Shares converted by such Holder pursuant to Section (6)(a), by (y) the Conversion Rate. In addition,
the Corporation will deliver, to the ful- lest extent permitted by law and out of funds lawfully available therefor, cash
in respect of ac- crued and unpaid Dividends, if any (and any accrued and unpaid dividends accrued pursuant to
Section (5)(c)), with respect to such Series A Preferred Shares converted by such Holder pur- suant to Section (6)
(a). In connection with any conversion request, a Holder must convert at least 1,000 Series A Preferred Shares
(unless it holds fewer than 1,000 Series A Preferred Shares at the time of such request, in which case, it must
convert such number of Series A Pre- ferred Shares held). No fractional Common Shares are to be issued upon
the conversion of any Series A Preferred Share, but rather the number of Common Shares to be issued shall be
roun- ded down to the nearest whole number and the Corporation shall in lieu of delivering any frac- tional
Common Share issuable upon conversion, to the fullest extent permitted by law and out of funds lawfully available
therefor, make a cash payment (calculated to the nearest cent) equal to such fraction multiplied by the Closing
Sale Price of the Common Shares on the relevant Conversion Date without interest. The applicable Conversion
Rate is subject to adjustment as hereinafter provided.
Mechanics of Conversion. The conversion of Series A Preferred Shares shall be conducted in the following
manner:
Holder’s Delivery Requirements. To convert Series A Preferred Shares into Common Shares on any
date, a Holder shall (A) deliver to the Corporation for receipt on or prior to 5:30 p.m., New York City Time,
on such date, a copy of a properly completed and duly executed notice of conversion executed by the
registered Holder of the Series A Preferred Shares subject to such conversion in the form attached
hereto as Exhi- bit 1 (a “Conversion Notice”); and (B) deliver to the Corporation funds for the pay- ment of
any applicable share transfer, documentary, stamp or similar taxes.
Corporation’s Response. As soon as practicable after the applicable Conversion Date, but in any event
within two (2) Trading Days, the Corporation shall (A) (x) provided the Transfer Agent is participating in
the Depository Trust Company (“DTC”) Fast Automa-
ted Securities Transfer Program (“FAST Program”) and the Common Shares issuable
upon such conversion are DTC eligible and are issuable without a restricted legend and with an
unrestricted CUSIP, as reasonably determined by the Corporation, credit such aggregate number of
Common Shares to which such Holder shall be entitled to such Holder’s or its designee’s balance
account with DTC through its Deposit/Withdra- wal at Custodian system, or (y) if the Transfer Agent is
not participating in the DTC FAST Program or the Common Shares issuable upon such conversion are
not DTC eli- gible or are not issuable without a restricted legend and with an unrestricted CUSIP,
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 9 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
as reasonably determined by the Corporation, make a book-entry notation registered in the name of such
Holder or its designee, for the number of Common Shares to which such Holder shall be entitled and
deliver to the address as specified in the ap- plicable Conversion Notice any notice required by law and
(B) deliver, to the fullest extent permitted by law and out of funds lawfully available therefor, cash in
respect of accrued and unpaid Dividends, if any (and any accrued and unpaid dividends accrued
pursuant to Section (5)(c)), with respect to such Series A Preferred Shares converted by such Holder
pursuant to Section (6)(a). While any Series A Preferred Shares are outstanding, the Corporation shall
use a transfer agent that participates in the FAST Program or any successor program.
Record Holder. To the fullest extent permitted by law, the Person or Persons entitled to receive the
Common Shares issuable upon a conversion of Series A Preferred Shares shall be treated for all
purposes as the record holder or holders of such Com- mon Shares on the applicable Conversion Date
or Mandatory Conversion Date (as de- fined below), as applicable, irrespective of the date such
Common Shares are credited to such Holder’s account with DTC or the date of the book-entry notations
evidencing such Common Shares, as the case may be.
Corporation’s Failure to Timely Convert. If a Holder has not received all of the Com- mon Shares to
which such Holder is entitled on or within two (2) Trading Days after the applicable share delivery date
with respect to a conversion of Series A Preferred Shares for any reason other such Holder’s failure to
comply with the conditions set forth herein, then such Holder, upon written notice to the Corporation, may
void its Conversion Notice with respect to, and retain or have returned, as the case may be, any Series A
Preferred Shares that have not been converted pursuant to such Hol- der’s Conversion Notice.
Mandatory Conversion at the Corporation’s Election. If at any time, or from time to time, during the applicable
Mandatory Conversion Period (i) the applicable Mandatory Conversion Price Condition is satisfied and (ii) no
Equity Conditions Failure exists on the Mandatory Conversion Date, the Corporation shall from time to time have
the right to require the Holders to convert all, or any portion, of the outstanding Series A Preferred Shares, as
designated in the Manda- tory Conversion Notice (as defined below) relating to the applicable Mandatory
Conversion on the applicable Mandatory Conversion Date into fully paid, validly issued and nonassessable
Common Shares and the Corporation will deliver, to the fullest extent permitted by law and out of funds lawfully
available therefor, cash in respect of accrued and unpaid Dividends, if any (and any accrued and unpaid dividends
accrued pursuant to Section (5)(c)), with respect to such Series A Preferred Shares converted by the Corporation
pursuant to this Section (6)(d) (a
“Mandatory Conversion”). The number of Common Shares issuable to a Holder in connection
with a Mandatory Conversion pursuant to this Section (6)(d) shall be determined by multi- plying (x) the
Conversion Amount in respect of the Series A Preferred Shares of such Holder converted by the Corporation
pursuant to this Section (6)(d) by (y) the Conversion Rate as of the applicable Mandatory Conversion Date. No
fractional Common Shares are to be issued upon the Mandatory Conversion of any Series A Preferred Share, but
rather the number of Common Shares to be issued shall be rounded down to the nearest whole number and the
Corporation shall in lieu of delivering any fractional Common Share issuable upon conversion make, to the fullest
extent permitted by law and out of funds lawfully available therefor, a cash
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 10 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
payment (calculated to the nearest cent) equal to such fraction multiplied by the Closing Sale Price of the
Common Shares on the relevant Mandatory Conversion Date without interest. The Corporation may exercise its
right to require conversion under this Section (6)(d) by delivering not more than one (1) Trading Day following the
end of any such Mandatory Conversion Mea- suring Period a written notice thereof to all Holders (a “Mandatory
Conversion Notice” and the date the Corporation delivers such notice to all Holders is referred to as a “Mandatory
Conversion Notice Date”). Each Mandatory Conversion Notice shall be irrevocable. Each Man-
datory Conversion Notice shall (i) state (a) the Trading Day on which the applicable Mandatory Conversion shall
occur, which Trading Day shall be the twentieth (20th) Trading Day following the applicable Mandatory Conversion
Notice Date (unless an earlier date is agreed to in writing between the Corporation and a Holder, but only with
respect to such Holder) (a “Mandatory
Conversion Date”), (b) the aggregate Conversion Amount of the Series A Preferred Shares
which the Corporation has elected to be subject to such Mandatory Conversion from such Hol- der and all other
Holders pursuant to this Section (6)(d), (c) the amount of accrued and unpaid Dividends, if any (and any accrued
and unpaid dividends accrued pursuant to Section (5)(c)), with respect to such Series A Preferred Shares
converted by the Corporation pursuant to this Section (6)(d), (d) the number of Common Shares to be issued to
such Holder on the appli- cable Mandatory Conversion Date, (e) in the event such Mandatory Conversion cannot
be consummated in full due to the limitations set forth in Section (6)(e), state whether the Corpo- ration shall on
the applicable Mandatory Conversion Date, to the fullest extent permitted by law and out of funds lawfully available
therefor, redeem the Series A Preferred Shares that can- not be converted due to such limitation (such Series A
Preferred Shares that the Corporation has elected to be subject to a Mandatory Conversion but which cannot be
so converted due to
the limitations set forth in Section (6)(e), the “Excess Mandatory Conversion Shares”)
and (f) state whether the conversion of all or any portion of the Series A Preferred Shares that the Corporation has
elected to be subject to a Mandatory Conversion will result in the issuance of a greater number of Common
Shares than permitted under Section (6)(e)(i), and (ii) certify that the applicable Mandatory Conversion Price
Condition relating to the applicable Mandatory Conversion has been satisfied and that there is no Equity
Conditions Failure as of the Manda- tory Conversion Notice Date. If the Corporation confirmed that there was no
such Equity Conditions Failure relating to the applicable Mandatory Conversion as of the applicable Manda- tory
Conversion Notice Date but an Equity Conditions Failure occurs at any time between the applicable Mandatory
Conversion Notice Date and the applicable Mandatory Conversion Date
(a “Mandatory Conversion Interim Period”) that the Corporation expects will last through the
applicable Mandatory Conversion Date, the Corporation shall provide each Holder a sub- sequent written notice to
that effect. If there is an Equity Conditions Failure on the applicable Mandatory Conversion Date, then such
Mandatory Conversion shall be null and void with res- pect to all or any part designated by such Holder of the
unconverted Series A Preferred Shares subject to the applicable Mandatory Conversion and such Holder shall be
entitled to all the rights of a holder of Series A Preferred Shares with respect to such Series A Preferred Shares;
provided, however, that if a Holder waives in writing an Equity Conditions Failure du- ring the applicable Mandatory
Conversion Interim Period, then the Corporation shall be requi- red to proceed with the applicable Mandatory
Conversion with respect to such Holder. Not- withstanding anything to the contrary in this Section (6)(d), until the
applicable Mandatory Conversion has occurred, the Series A Preferred Shares subject to the Mandatory
Conversion may be converted, in whole or in part, by a Holder into Common Shares pursuant to Sec- tions (6)(a)-
(c). All Series A Preferred Shares converted by a Holder after a Mandatory Conver-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 11 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
sion Notice Date shall reduce the Series A Preferred Shares required to be converted on the re- lated Mandatory
Conversion Date. If a Mandatory Conversion cannot be consummated in full due to the limitations set forth in
Section (6)(e), then (i) on the applicable Mandatory Conversa- tion Date, only that portion of the applicable
Mandatory Conversion that complies with the li- mitations set forth in Section (6)(e) shall occur, (ii) unless the
Corporation has indicated in the applicable Mandatory Conversion Notice that it shall redeem the applicable
Excess Mandatory Conversion Shares on the applicable Mandatory Conversion Date, such Holder must promptly
deliver one or more Conversion Notice(s) to the Corporation upon disposition of any securities of the Corporation
that would permit the conversion of any portion of such Excess Mandatory Conversion Shares and (iii)
notwithstanding anything herein to the contrary, Preferential Divi- dends with respect to the Series A Preferred
Shares which the Corporation has elected to be subject to such Mandatory Conversion shall cease to accrue and
be payable as of the appli- cable Mandatory Conversion Date and all approval, consent or voting rights and any
right to a Make-Whole Amount shall cease with respect to the Series A Preferred Shares not able to be so
converted. If a Mandatory Conversion consummated in full would violate the limitations set forth in (i) Section (6)
(e)(ii), the Corporation may indicate in the related Mandatory Conversion Notice that it shall redeem, to the fullest
extent permitted by law and out of funds lawfully avai- lable therefor, the Excess Mandatory Conversion Shares on
the applicable Mandatory Conver- sion Date in cash, without interest, at a price equal to the greater of (x) 100% of
the Conversion Amount in respect of the applicable Excess Mandatory Conversion Shares and (y) the product of
(1) the Conversion Amount of the applicable Excess Mandatory Conversion Shares and (2) the quotient
determined by dividing (A) the greatest Closing Sale Price of the Common Shares during the period beginning on
the Trading Day immediately preceding the applicable Manda- tory Conversion Notice Date and ending on the
Trading Day immediately preceding the appli- cable Mandatory Conversion Date, by (B) the lowest Conversion
Price in effect during such per- iod referred to in the immediately preceding clause (y)(2)(A) or (ii) Section (6)(e)(i),
the Corpora- tion may indicate in the related Mandatory Conversion Notice that it shall redeem the portion of the
Series A Preferred Shares that is subject to a Mandatory Conversion that cannot be converted due to the
limitations set forth in Section (6)(e)(i) on the applicable Mandatory Conversion Date in cash, without interest, at a
price per Common Share that the Corporation is prohibited from issuing pursuant to Section (6)(e)(i) equal to the
amount set forth in the last sentence of Section (6)(e)(i). If the Corporation elects to cause a Mandatory
Conversion pur- suant to this Section (6)(d), then it must simultaneously take the same action in the same pro-
portion with respect to all Series A Preferred Shares to the extent practicable or, if the pro rata basis is not
practicable for any reason, by lot or such other equitable method as the Corpora- tion determines in good faith. On
the Mandatory Conversion Date, each Series A Preferred Share to be converted pursuant to such Mandatory
Conversion shall automatically be conver- ted into fully paid, validly issued, nonassessable Common Shares as
described above without any further act or deed on the part of the Corporation, any Holder or any other Person.
Limitation on Conversions.
Principal Market Regulation. The Corporation shall not be obligated to issue any Com- mon Shares
pursuant to the terms of these Articles of Continuance, and the Holders shall not have the right to receive
any Common Shares pursuant to the terms of these Articles of Continuance, to the extent the issuance
of such Common Shares would ex- ceed 22,165,789 Common Shares (as adjusted for any share
dividend, share split, share combination, reclassification or similar transaction relating to the Common
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 12 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Shares occurring after the Subscription Date) (the “Exchange Cap”), except that such limitation shall not
apply in the event that the Corporation obtains the approval of its shareholders as required by the
applicable rules of the Principal Market and the To- ronto Stock Exchange (or its successor), as
applicable, for issuances of Common Shares in excess of such amount or if the Principal Market and the
Toronto Stock Ex- change (or its successor), as applicable, allows for a greater number of Common
Shares to be issued pursuant to these Articles of Continuance. Until such approval is obtained, no Holder
shall be issued in the aggregate, pursuant to the terms of these Articles of Continuance, Common
Shares in an amount greater than the product of the Exchange Cap multiplied by a fraction, the
numerator of which is the number of Series A Preferred Shares issued to such initial Holder pursuant to
the Securities Pur- chase Agreement on the Issuance Date and the denominator of which is the aggre-
gate number of all Series A Preferred Shares issued to the initial Holders pursuant to the Securities
Purchase Agreement on the Issuance Date (with respect to each such
Holder, the “Exchange Cap Allocation”). In the event that any Holder shall sell or
otherwise transfer any of such Holder’s Series A Preferred Shares, the transferee shall be allocated a
pro rata portion of such Holder’s Exchange Cap Allocation, and the res- trictions of the prior sentence
shall apply to such transferee with respect to the por- tion of the Exchange Cap Allocation allocated to
such transferee. In the event that any Holder shall have converted any of such Holder’s Series A
Preferred Shares into a number of Common Shares which, in the aggregate, is less than such Holder’s
Ex- change Cap Allocation, then the difference between such Holder’s Exchange Cap Allo- cation and
the number of Common Shares actually issued to such Holder shall be al- located to the respective
Exchange Cap Allocations of the remaining Holders on a pro rata basis in proportion to the Common
Shares underlying the Series A Preferred Shares then held by each such Holder. In the event that the
Corporation is prohibited from issuing any Common Shares in connection with a conversion of Series A
Prefer- red Shares pursuant to Section (6)(a) or Section (6)(d)or in respect of Preferential Divi-
dend Shares as a result of the operation of this Section (6)(e)(i) (the “Exchange Cap
Shares”), the Corporation shall, to the fullest extent permitted by law and out of funds lawfully available
therefor, pay cash on or prior to the applicable share delivery date to such Holder in exchange for the
redemption of such number of Series A Pre- ferred Shares held by the Holder that are not convertible
into such Exchange Cap Shares at a price equal to the product of (x) such number of Exchange Cap
Shares and (y) the Closing Sale Price of the Common Shares on the applicable Conversion Date or
Mandatory Conversion Date, as the case may be, except that if the Exchange Cap Shares are
Preferential Dividend Shares, the Corporation shall instead pay to such Holder Cash Preferential
Dividends on the applicable Preferential Dividend Date in accordance with Section (5).
HSR Cap. Notwithstanding anything to the contrary contained herein, until the HSR Date the Corporation
shall not effect the conversion of any portion of Series A Prefer- red Shares held by an HSR Holder in
excess of the HSR Amount, and no HSR Holder shall have the right to convert any portion of its Series A
Preferred Shares in excess of the HSR Amount pursuant to the terms and conditions of these Articles of
Conti- nuance and any such conversion shall be null and void and treated as if never made.
Transfer Taxes. The Corporation shall not be required to pay any documentary stamp or simi-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 13 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Exhibit 3.1
Adjustments to Conversion Rate.
lar tax that may be payable in respect of the issuance, delivery, payment or other transfer of Series A Preferred
Shares, Common Shares or other securities, and shall not be required to make any such issuance, delivery,
payment or other transfer unless and until the Person entit- led to such issuance, delivery, payment or other
transfer or any other Person liable for such tax has paid to the Corporation the amount of any such tax or has
established, to the reasonable satisfaction of the Corporation (as determined in its reasonable discretion), that
such tax has been paid or is not payable.
Adjustments. The Conversion Rate will be subject to adjustment, without duplication, upon the occurrence of
the following events, except that the Corporation shall not make any adjustment to the Conversion Rate if each
Holder of the Series A Preferred Shares participates, at the same time and upon the same terms as holders of
Common Shares and solely as a result of holding Series A Preferred Shares, in any transaction described in
this Section (7)(a), without having to convert its Series A Preferred Shares, as if it held a number of Common
Shares equal to (x) the Conversion Rate, multiplied by (y) the Conversion Amount of Series A Preferred Shares
held by such Holder (without regard to any limitations on conversion):
The exclusive issuance of Common Shares as a dividend or distribution on all or sub- stantially all of
the Common Shares, or a subdivision or combination of Common Shares or a reclassification of
Common Shares into a greater or lesser number of Common Shares, in which event the Conversion
Rate shall be adjusted based on the following formula:
CR1 = CR0 x (OS1 / OS0)
CR0 = the Conversion Rate in effect immediately prior to the open of business on (i) the Ex-Dividend
Date for such dividend or distribution, or (ii) the effective date of such subdivision, combination or
reclassification
CR1 = the new Conversion Rate in effect immediately after the open of business on (i) the Ex-
Dividend Date for such dividend or distribution, or (ii) the effective date of such subdivision,
combination or reclassification
OS0 = the number of Common Shares outstanding immediately prior to the open of business on (i)
the Ex-Dividend Date for such dividend or distribution or (ii) the effec- tive date of such subdivision,
combination or reclassification
OS1 = the number of Common Shares outstanding immediately after, and solely as a result of, the
completion of such event
Any adjustment made pursuant to this clause (i) shall be effective immediately after the open of
business on the Ex-Dividend Date for such dividend or distribution, or the effective date of such
subdivision, combination or reclassification, as applicable. If any such event is announced or
declared but does not occur, the Conversion Rate shall be readjusted, effective as of the date the
Corporation announces that such event shall not occur, to the Conversion Rate that would then be in
effect if such event had not been declared.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 14 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
The dividend, distribution or other issuance to all or substantially all holders of Com- mon Shares of
rights (other than rights, options or warrants distributed in connection with a shareholder rights plan (in
which event the provisions of Section (7)(a)(vi) shall apply)), options or warrants entitling them to
subscribe for or purchase Common Shares for a period expiring forty-five (45) days or less from the date
of issuance the- reof, at a price per share that is less than the Current Market Price as of the date such
dividend, distribution or other issuance is publicly announced (the “Public Announce-
ment Date”) for such issuance, in which event the Conversion Rate will be increased based on the
following formula:
CR1 = CR0 x [(OS0+X) / (OS0+Y)]
CR0 = the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date
for such dividend, distribution or issuance
CR1 = the new Conversion Rate in effect immediately following the open of business on the Ex-Dividend
Date for such dividend, distribution or issuance
OS0 = the number of Common Shares outstanding immediately prior to the open of business on the Ex-
Dividend Date for such dividend, distribution or issuance
X = the total number of Common Shares issuable pursuant to such rights, options or warrants
Y = the number of Common Shares equal to the aggregate price payable to exercise such rights, options
or warrants divided by the Current Market Price as of the Public Announcement Date for such dividend,
distribution or issuance
For purposes of this clause (ii), in determining whether any rights, options or warrants entitle the holders
to purchase the Common Shares at a price per share that is less than the Current Market Price as of the
Public Announcement Date for such dividend, distribution or issuance, there shall be taken into account
any consideration the Corpo- ration receives for such rights, options or warrants, and any amount payable
on exer- cise thereof, with the value of such consideration, if other than cash, to be the Fair Market Value
thereof.
Any adjustment made pursuant to this clause (ii) shall become effective immediately following the open of
business on the Ex-Dividend Date for such dividend, distribution or issuance. In the event that such rights,
options or warrants are not so issued, the Conversion Rate shall be readjusted, effective as of the date
the Corporation publicly announces its decision not to issue such rights, options or warrants, to the
Conversion Rate that would then be in effect if such dividend, distribution or issuance had not been
declared. To the extent that such rights, options or warrants are not exercised prior to their expiration or
Common Shares are otherwise not delivered pursuant to such rights, options or warrants upon the
exercise of such rights, options or warrants, the Conversion Rate shall be readjusted to the Conversion
Rate that would then be in effect had the adjustments made upon the dividend, distribution or issuance of
such rights, options or warrants been made on the basis of the delivery of only the number of Common
Shares actually delivered.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 15 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
The distribution by the Corporation to all or substantially all holders of its Common Shares (other than for
cash in lieu of fractional shares), shares of any class of its share capital, evidences of its indebtedness,
assets, other property, securities or special cash dividends (including, without limitation, the IAA Special
Dividend, but exclu- ding (A) regular quarterly cash dividends that are Participating Dividends in accor-
dance with Section (5)(b)), (B) dividends or distributions referred to in Section (7)(a)(i) or Section (7)(a)(ii)
hereof, (C) Distribution Transactions as to which Section (7)(a)(iv) shall apply, (D) rights, options or
warrants distributed in connection with a shareholder rights plan as to which Section (7)(a)(v) shall apply
and (E) distributions of Reference Property in a Corporate Event described in Sec- tion (9)(c) hereof)
(any of such shares of its share capital, indebtedness, assets, pro- perty, securities or special cash
dividends that are not so excluded are hereinafter cal-
led the “Distributed Property”), then, in each such case the Conversion Rate shall be
adjusted based on the following formula: CR1 = CR0 x
[SP0 / (SP0 - FMV)]
CR0 = the Conversion Rate in effect immediately prior to the open of business on the Ex-Dividend Date
for such dividend or distribution
CR1 = the new Conversion Rate in effect immediately after the open of business on the Ex-Dividend Date
for such dividend or distribution
SP0 = the Current Market Price as of the Ex-Dividend Date for such dividend or distri- bution
FMV = the Fair Market Value of the portion of Distributed Property distributed with res- pect to each
outstanding Common Share on the Ex-Dividend Date for such dividend or distribution; provided that in the
event of a dividend or distribution of cash, FMV shall equal the amount in cash per Common Share the
Corporation distributes to all or sub- stantially all holders of its Common Shares; provided further that, if
FMV is equal or greater than SP0, then in lieu of the foregoing adjustment, the Corporation shall distri-
bute to each Holder of Series A Preferred Shares on the date the applicable Distributed Property is
distributed to holders of Common Shares, but without requiring such Hol- der to convert its Series A
Preferred Shares, in respect of each Series A Preferred Share held by such Holder, the amount of
Distributed Property such holder would have recei- ved had such holder owned a number of Common
Shares equal to the Conversion Rate on the Ex-Dividend Date for such dividend or distribution
Any adjustment made pursuant to this clause (iii) shall be effective immediately after the open of business
on the Ex-Dividend Date for such dividend or distribution. If any such dividend or distribution is declared
but does not occur, the Conversion Rate shall be readjusted, effective as of the date the Corporation
announces that such dividend or distribution shall not occur, to the Conversion Rate that would then be in
effect if such dividend or distribution had not been declared.
The Corporation effects a Distribution Transaction, in which case the Conversion Rate shall be increased
based on the following formula:
CR1 = CR0 x [(FMV + MP0) / MP0]
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 16 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
CR0 = the Conversion Rate in effect immediately prior to the end of the Valuation Per- iod (as defined
below)
CR1 = the new Conversion Rate in effect immediately after the end of the Valuation Period
FMV = the arithmetic average of the Weighted Average Prices for a common share or similar equity
interest distributed per Common Share to holders of Common Shares over the first ten (10) consecutive
Trading Day period after, and including, the Ex-Divi- dend Date for the Distribution Transaction (the
“Valuation Period”); provided that, if there is no Weighted Average Price of the common share or similar
equity interest dis- tributed to holders of the Common Shares on such Ex-Dividend Date, the “Valuation
Period” shall be the ten (10) consecutive Trading Day period after, and including, the first Trading Day
such Weighted Average Price is available
MP0 = the arithmetic average of the Weighted Average Price per Common Share over the Valuation
Period
Such adjustment shall become effective immediately following the close of business on the last Trading Day
of the Valuation Period. If an adjustment to the Conversion Rate is re- quired under this Section (7)(a)(iv),
delivery of any additional Common Shares that may be deliverable upon conversion as a result of an
adjustment required under this Section (7)(a)(iv) shall be delayed to the extent necessary in order to
complete the cal- culations provided for in this Section (7)(a)(iv). If any Distribution Transaction is declared
but not so paid or made, the Conversion Rate shall be immediately decreased, effective as
of the date the Board of Directors of the Corporation (the “Board”) determines not to pay
or make such dividend or distribution, to the Conversion Rate that would then be in effect if such dividend or
distribution had not been declared or announced.
If the Corporation or any of its Subsidiaries make a payment in respect of a tender or exchange offer for
the Common Shares that is subject to the then applicable tender offer rules under the Exchange Act,
other than an odd lot tender offer pursuant to Rule 13e-4(h)(5) under the Exchange Act, to the extent that
the cash and value of any other consideration included in the payment per Common Share exceeds the
average of the Weighted Average Prices of the Common Shares over the ten (10) consecutive Trading
Day period commencing on, and including, the Trading Day next succeeding the last date on which
tenders or exchanges may be made pursuant to such tender or exchange offer, the Conversion Rate
shall be increased based on the following for- mula:
CR1 = CR0 x [AC+(SP1 x OS1)] / (OS0 x SP1)
CR0 = the Conversion Rate in effect immediately prior to the close of business on the 10th Trading Day
immediately following, and including, the Trading Day next succee- ding the date such tender or exchange
offer expires
CR1 = the Conversion Rate in effect immediately after the close of business on the 10th Trading Day
immediately following, and including, the Trading Day next succeeding the date such tender or exchange
offer expires
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 17 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
AC = the aggregate value of all cash and any other consideration (as determined by the Corporation) paid
or payable for Common Shares purchased in such tender or ex- change offer
OS0 = the number of Common Shares outstanding immediately prior to the date such tender or exchange
offer expires (prior to giving effect to the purchase of all Common Shares accepted for purchase or
exchange in such tender or exchange offer)
OS1 = the number of Common Shares outstanding immediately after the date such tender or exchange
offer expires (after giving effect to the purchase of all Common Shares accepted for purchase or
exchange in such tender or exchange offer)
SP1 = the average of the Weighted Average Prices of the Common Shares over the 10 consecutive
Trading Day period commencing on, and including, the Trading Day next succeeding the date such tender
or exchange offer expires
The adjustment to the Conversion Rate under this Section (7)(a)(v) shall occur at the close of business on the
10th Trading Day immediately following, and including, the Trading Day next succeeding the date such tender
or exchange offer expires. If an adjustment to the Conversion Rate is required under this Section (7)(a)(v),
delivery of any additional Com- mon Shares that may be deliverable upon conversion as a result of an
adjustment requi- red under this Section (7)(a)(v) shall be delayed to the extent necessary in order to com-
plete the calculations provided for in this Section (7)(a)(v). If the Corporation or one of its Subsidiaries is
obligated to purchase Common Shares pursuant to any such tender or ex- change offer described in the
preceding paragraph but the Corporation is, or such Subsi- diary is, permanently prevented by applicable law
from effecting any such purchase or all such purchases are rescinded, the Conversion Rate will be
decreased to be the Conver- sion Rate that would then be in effect if such tender or exchange offer had not
been made or had been made only in respect of the purchases that have been effected.
If the Corporation has a shareholder rights plan in effect with respect to the Common Shares on any
Conversion Date or Mandatory Conversion Date, upon conversion of any of the Series A Preferred
Shares, Holders of such shares will receive, in addition to the applicable number of Common Shares, the
rights under such rights plan relating to such Common Shares, unless, prior to such Conversion Date,
the rights have (A) be- come exercisable or (B) separated from the Common Shares (the first of such
events
to occur, a “Trigger Event”), in which case, the Conversion Rate will be adjusted, effec-
tive automatically at the time of such Trigger Event, as if the Corporation had made a distribution of such
rights to all holders of the Common Shares as described in Sec- tion (7)(a)(ii) (without giving effect to the
forty-five (45) day limit on the exercisability of rights, options or warrants ordinarily subject to such
Section (7)(a)(ii)), subject to ap- propriate readjustment in the event of the expiration, termination or
redemption of such rights prior to the exercise, deemed exercise or exchange thereof. Notwithstan- ding
the foregoing, to the extent any such shareholder rights are exchanged by the Corporation for Common
Shares or other property or securities, the Conversion Rate shall be appropriately readjusted as if such
shareholder rights had not been issued, but the Corporation had instead issued such Common Shares or
other property or se- curities as a dividend or distribution of Common Shares pursuant to Section (7)(a)(i)
or Section (7)(a)(iii), as applicable.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 18 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
To the extent that such rights are not exercised prior to their expiration, termination or redemption, the
Conversion Rate shall be readjusted to the Conversion Rate that would then be in effect had the
adjustments made upon the occurrence of the Trigger Event been made on the basis of the issuance of,
and the receipt of the exercise price with respect to, only the number of Common Shares actually issued
pursuant to such rights.
Notwithstanding anything to the contrary in this Section (7)(a)(vi), no adjustment shall be required to be
made to the Conversion Rate with respect to any Holder which is, or is an “affiliate” or “associate” of, an
“acquiring person” (or analogous term) under such shareholder rights plan or with respect to any direct or
indirect transferee of such Holder who receives Series A Preferred Shares in such transfer after the time
such Holder becomes, or its affiliate or associate becomes, an “acquiring person” (or analo- gous term).
Calculation of Adjustments. All adjustments to the Conversion Rate shall be calculated by the Corporation to the
nearest 1/10,000,000th of one Common Share (or if there is not a nearest 1/10,000,000th of a share, to the next
lower 1/10,000,000th of a share). No adjustment to the Conversion Rate will be required unless such adjustment
would require an increase or de- crease of at least one percent of the Conversion Rate; provided, however, that
any such adjust- ment that is not required to be made will be carried forward and taken into account in any
subsequent adjustment; provided further that any such adjustment of less than one percent that has not been
made will be made upon any conversion.
When No Adjustment Required.
Except as otherwise provided in this Section (7), the Conversion Rate will not be adjus- ted for the
issuance of Common Shares or any securities convertible into or exchan- geable for Common Shares or
carrying the right to purchase any of the foregoing, or for the repurchase of Common Shares.
Except as otherwise provided in this Section (7), the Conversion Rate will not be adjus- ted as a result of
the issuance of, the distribution of separate certificates represen- ting, the exercise or redemption of, or
the termination or invalidation of, rights pur- suant to any shareholder rights plans.
No adjustment to the Conversion Rate will be made:
upon the issuance of any Common Shares pursuant to any present or future plan providing for the
reinvestment of dividends or interest payable on securities of the Corporation and the investment of
additional optional amounts in Common Shares under any plan in which purchases are made at market
prices on the date or dates of purchase, without discount, and whether or not the Corporation bears the
ordinary costs of administration and operation of the plan, including brokerage commissions;
upon the issuance of any Common Shares or options or rights to purchase such shares pursuant to any
present or future employee, director or officer benefit or equity incentive arrangement, plan or program of
or assumed by the Corporation or any of its Subsidiaries or of any employee agreements or
arrangements or programs;
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 19 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
except as otherwise provided in this Section (7) upon the issuance of any Common Shares pursuant to
any option, warrant, right, or exercisable, exchangeable or any shares or securities directly or indirectly
convertible into or exercisable or exchan- geable for Common Shares;
for dividends or distributions declared or paid to holders of Common Shares in which Holders participate
pursuant to Section (5);
for a third-party tender offer or exchange offer by any party other than a tender offer or exchange offer by
one or more of the Corporation’s Subsidiaries as described in Section (7)(a)(v); or
for any accrued and unpaid dividends (in accordance with Section (5)(c)) or Dividends.
Successive Adjustments. After an adjustment to the Conversion Rate under this Section (7), any subsequent event
requiring an adjustment under this Section (7) shall cause an adjustment to each such Conversion Rate as so
adjusted.
Multiple Adjustments. For the avoidance of doubt, if an event occurs that would trigger an ad- justment to the
Conversion Rate pursuant to this Section (7) under more than one subsection hereof, such event, to the extent
fully taken into account in a single adjustment, shall not result in multiple adjustments hereunder; provided,
however, that if more than one subsection of this Section (7) is applicable to a single event, the subsection shall be
applied that produces the highest adjusted Conversion Rate.
Notice of Adjustments. Whenever the Conversion Rate is adjusted as provided under this Sec- tion (7), the
Corporation shall as soon as reasonably practicable following the occurrence of an event that requires such
adjustment (or if the Corporation is not aware of such occurrence, as soon as reasonably practicable after
becoming so aware) compute the adjusted applicable Conversion Rate in accordance with this Section (7) and
prepare and transmit to the Holders and if the Transfer Agent maintains the register and records pursuant to
Section (17), the
Transfer Agent a certificate of an authorized officer of the Corporation (an “Officer’s Certifi-
cate”) setting forth the applicable Conversion Rate, the method of calculation thereof, and the facts requiring such
adjustment and upon which such adjustment is based.
Transfer Agent. The Transfer Agent shall not at any time be under any duty or responsibility to any Holder to
determine whether any facts exist that may require any adjustment of the Conversion Rate or with respect to the
nature or extent or calculation of any such adjustment when made, or with respect to the method employed in
making the same. The Transfer Agent shall be fully authorized and protected in relying on any Officer’s Certificate
delivered pursuant to Section (7)(f) and any adjustment contained therein and the Transfer Agent shall not be dee-
med to have knowledge of any adjustment unless and until it has received such certificate. The Transfer Agent
shall not be responsible for any failure of the Corporation to issue, transfer or deliver any Common Shares
pursuant to the conversion of Series A Preferred Shares or to comply with any of the duties, responsibilities or
covenants of the Corporation contained in this Section (7).
Offer To Repurchase. If, at any time while any Series A Preferred Shares remain outstanding, the Corporation redeems or repur- chases any of its
Common Shares, Junior Shares, options or warrants that are convertible, exchangeable or exercisable for Com- mon Shares after it has redeemed or
repurchased from and after the Subscription Date an aggregate of US$2.0 billion of Com-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 20 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
mon Shares (and/or Common Shares underlying any Junior Shares, options or warrants that are convertible, exchangeable or exercisable for
Common Shares) (an “Offer to Repurchase Event”), the Corporation shall deliver a written notice thereof (an “Offer to Repurchase Notice”) no later than
five (5) Business Days following the end of the Calendar Quarter during which one or more Offer to Repurchase Events occurred to all, but not less
than all, of the Holders (the date the Corporation delivers such notice to all Holders is referred to as an “Offer to Repurchase Notice Date”) and offer to
repurchase (an “Offer to Repurchase”) from each Holder a number of such Holder’s Series A Preferred Shares equal to no less than such Holder’s Offer
to Repurchase Pro Rata Portion of the Offer to Repurchase Percentage of the Series A Preferred Shares then issued and outstan- ding (such number
of Series A Preferred Shares, the “Offer to Repurchase Shares”). An Offer to Repurchase shall offer to re-
deem each such Offer to Repurchase Share for cash at a price equal to the applicable Offer to Repurchase Price. Within twenty
(20) Business Days after the receipt by the Holder of an Offer to Repurchase Notice, each Holder may require the Corporation to redeem to the fullest
extent permitted by law and out of funds lawfully available therefor, at the Offer to Repurchase Price, up to the amount of such Holder’s Offer to
Repurchase Shares by delivering written notice thereof (an “Acceptance Notice”) to the Corporation which Acceptance Notice shall indicate the number
of Offer to Repurchase Shares that such Holder is electing to re- deem and the wire instructions for the payment of the applicable Offer to Repurchase
Price to such Holder. Each Offer to Repur- chase shall occur on the thirtieth (30th) Business Day following the end of the Calendar Quarter during
which one more Offers to Repurchase giving rise to the applicable Offer to Repurchase occurred (an “Offer to Repurchase Date”). Each Offer to Repur-
chase Notice shall (A) describe the applicable Offer to Repurchase Event, including, without limitation, the calculation of the Offer to Repurchase Pro
Rata Portion, the Offer to Repurchase Percentage and the Offer to Repurchase Price and (B) state the maxi- mum Offer to Repurchase Price to be
paid to such Holder on such Offer to Repurchase Date. On the applicable Offer to Repur- chase Date the Corporation shall deliver or shall cause to be
delivered to the Holder to the fullest extent permitted by law and out of funds lawfully available therefor the Offer to Repurchase Price in cash by wire
transfer of immediately available funds pur- suant to wire instructions provided by the Holder in writing to the Corporation in its Acceptance Notice.
Unless otherwise indica- ted in a Conversion Notice, all Series A Preferred Shares converted by the Holder after the Offer to Repurchase Notice Date
shall reduce the Holder’s right to require redemption of the Holder’s Offer to Repurchase Shares on a one-for-one basis.
Change of Control Redemption Rights.
Holders’ Change of Control Redemption Right. No later than ten (10) days prior to the consum- mation of a
Change of Control, or, if not practicable as promptly as reasonably practicable after the Corporation is aware of
such Change of Control, the Corporation shall deliver written no- tice thereof to the Holders (a “Change of Control
Notice”) setting forth a description of such transaction in reasonable detail and the anticipated Change of Control
Redemption Date (as defined below) if then known. At any time during the period beginning after a Holder’s receipt
of a Change of Control Notice and ending on the date that is twenty (20) Trading Days after the consummation of
such Change of Control, such Holder may require the Corporation to redeem (a “Change of Control Redemption”), to
the fullest extent permitted by law and out of funds lawfully available therefor, all or any portion of such Holder’s
Series A Preferred Shares by deli- vering written notice thereof (“Change of Control Redemption Notice”) to the
Corporation and, if the Transfer Agent maintains the register and records pursuant to Section (17), the Transfer
Agent, which Change of Control Redemption Notice shall indicate the number of Se- ries A Preferred Shares such
Holder is electing to redeem (which number shall be at least one thousand (1,000) Series A Preferred Shares)
(unless it holds fewer than 1,000 Series A Preferred Shares at the time of such request, in which case, it must
convert such number of Series A Pre- ferred Shares held) and include wire instructions for the payment of the
applicable Change of Control Redemption Price. Any Series A Preferred Shares subject to redemption pursuant to
this Section (9)(a) shall, to the fullest extent permitted by law and out of funds lawfully available therefor, be
redeemed by the Corporation in cash, without interest, at a price equal to the sum of (A) the greater of (x) the
Conversion Amount of the Series A Preferred Shares being redee-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 21 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
med and (y) the Change of Control As-Converted Value with respect to the Series A Preferred Shares being
redeemed, (B) the Make-Whole Amount and (C) accrued and unpaid Dividends, if any (and any accrued and
unpaid dividends accrued pursuant to Section (5)(c)), with respect to such Series A Preferred Shares being
redeemed (the amount in this clause (C), the “Change of Control Accrued Dividends Payment”, the sum of the
amounts in the immediately preceding clauses (A) and (B), the “Base Change of Control Redemption Price” and
the sum of the
amounts in the immediately preceding clauses (A), (B) and (C), the “Change of Control Re-
demption Price”); provided, however, that each Holder, at its option, may, instead of requiring the redemption of any
Series A Preferred Shares, elect in its Change of Control Redemption Notice to require the Corporation to
exchange such Series A Preferred Shares for (1) such num- ber of Common Shares (the “Redemption Exchange
Shares”) calculated by dividing (x) the ap- plicable Base Change of Control Redemption Price, by (y) the applicable
Make-Whole Share Price, and, (2) to the fullest extent permitted by law and out of funds lawfully available therefor,
the applicable Change of Control Accrued Dividends Payment in cash (together with the Re- demption Exchange
Shares, the “Redemption Exchange Consideration”). The Corporation shall make payment of the Change of Control
Redemption Price, or the exchange of Series A Preferred Shares for Redemption Exchange Consideration,
concurrently with the consumma- tion of such Change of Control if such a Change of Control Redemption Notice is
received at least five (5) Trading Days prior to the consummation of such Change of Control and within five
(5) Trading Days after the Corporation’s receipt of such notice otherwise (the “Change of
Control Redemption Date”). Once a Change of Control Redemption Notice has been delive- red, the Series A
Preferred Shares submitted for redemption (or exchange) under this Sec- tion (9)(a) may not be converted, in
whole or in part, pursuant to Sections(6)(a)-(c). In the event that a Holder elects to require the exchange of Series
A Preferred Shares for Redemption Ex- change Consideration as set forth above, the Corporation shall make
appropriate provision to ensure that such Holder will have the right to receive, in exchange for the Redemption Ex-
change Shares included in such Redemption Exchange Consideration (or in lieu of Redemption Exchange Shares
included in such Redemption Exchange Consideration, if the Change of Control is consummated before the
delivery of such Redemption Exchange Shares), such shares of stock, securities, cash, assets or any other
property whatsoever (including warrants or other purchase or subscription rights), if any, which are paid to the
holders of Common Shares of the Corporation in connection with such Change of Control in accordance with Sec-
tion (9)(c). Notwithstanding anything to the contrary contained in this Section (9)(a), in the event of a Change of
Control Redemption, the Corporation shall only pay the Change of Control Redemption Price in cash as required
by this Section (9) after paying in full in cash all obligations of the Corporation and its Subsidiaries under any credit
agreement, indenture or si- milar agreement evidencing indebtedness for borrowed money (including the
termination of all commitments to lend, to the extent required by such credit agreement, indenture or similar
agreement) in excess of US$50.0 million, individually, and in existence at the time of such Change of Control
Redemption (without giving effect to any amendment, supplement, restate- ment, replacement, refinance or other
modification thereto on or after or in anticipation of
such Change of Control) (collectively, the “Debt Documents”), which requires prior payment of
the obligations thereunder (and termination of commitments thereunder, if applicable) as a condition to the
payment of such Change of Control Redemption Price in cash (all such requi- red payments under the Debt
Documents in the event of a Change of Control are collectively referred to as the “Senior Debt Payments”;
provided, however, that the Corporation shall use its commercially reasonable best efforts to pay such Senior Debt
Payments without delay in ac-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 22 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
cordance with the terms of the Debt Documents and shall not be allowed to circumvent any payment of a Change
of Control Redemption Price by unnecessarily delaying the payment of any Senior Debt Payments.
Redemption by the Corporation Upon a Qualified Change of Control. In the case of a Change of Control as a
result of which the Series A Preferred Shares are not convertible into common share capital that is quoted on or
listed for trading on an Eligible Market (a “Qualified Change
of Control”), any Series A Preferred Shares, may be redeemed, at the option of the Corpora-
tion (or its successor or the acquiring or surviving Person in such Qualified Change of Control), upon not less than
thirty (30) days’ notice delivered to the Holders not later than ten (10) days after the consummation of such
Qualified Change of Control, at a redemption price per share equal to the Change of Control Redemption Price
with respect to such Qualified Change of Control. Unless the Corporation (or its successor or the acquiring or
surviving Person in such Qualified Change of Control) defaults in making the redemption payment on the
applicable Change of Control Redemption Date, on and after such Change of Control Redemption Date, (A)
Dividends shall cease to accrue on the Series A Preferred Shares so called for redemp- tion, (B) all Series A
Preferred Shares called for redemption shall no longer be deemed outstan- ding and (C) all rights with respect to
such Series A Preferred Shares shall on such Change of Control Redemption Date cease and terminate, except
only the right of the Holders thereof to receive the amount payable in such redemption.
Corporate Events. If there shall occur any Fundamental Transaction, as a result of which the Common Shares are
converted into or exchanged for securities, cash, assets or other property (a “Corporate Event”), then following any
such Corporate Event, each Series A Preferred Share shall remain outstanding (subject to the last paragraph of
Section (14)) and be convertible into the number, kind and amount of securities, cash, assets or other property
which a Holder would have received in such Corporate Event had such Holder converted its Series A Preferred
Share into the applicable number of Common Shares immediately prior to the effective date of the Corporate
Event using the Conversion Rate applicable immediately prior to the effective date of such Corporate Event (the
“Reference Property”); and, in such case, appropriate ad- justment shall be made in the application of the provisions
set forth in Section (7) and this Sec- tion (9)(c) with respect to the rights and interests thereafter of the Holders, to
the extent that the provisions set forth in Section (7) and this Section (9)(c) (including provisions with respect to
changes in and other adjustments of the Conversion Rate) and Section (9) shall thereafter be applicable in relation
to any securities, cash, assets or other property thereafter deliverable upon the conversion of the Series A
Preferred Shares. The Corporation (or any successor the- reto) shall, no less than twenty (20) Business Days prior
to the occurrence of any Corporate Event, provide written notice to the Holders of such occurrence of such event
and of the kind and amount of the securities, cash, assets or other property that each Series A Preferred Share
will be convertible into under this Section (9)(c). Failure to deliver such notice shall not affect the operation of this
Section (9)(c). The Corporation shall not enter into any agreement for a transaction constituting a Corporate Event
unless, subject to the last paragraph of Sec- tion (14), (i) such agreement provides for, or does not interfere with or
prevent (as applicable), conversion of the Series A Preferred Shares in a manner that is consistent with and gives
effect to this Section (9)(c) and (ii) to the extent that the Corporation is not the surviving entity in such Corporate
Event or will be dissolved in connection with such Corporate Event, proper provision shall be made in the
agreements governing such Corporate Event for the conversion of the Se- ries A Preferred Shares into the
Reference Property and the assumption by such Person of the
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 23 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
obligations of the Corporation under these Articles. If the Corporate Event causes the Common Shares to be
converted into, or exchanged for, the right to receive more than a single type of consideration (determined based
in part upon any form of shareholder election), then for the purposes of this Section (9)(c), the Reference Property
into which the Series A Preferred Shares shall be convertible shall be deemed to be the weighted average of the
types and amounts of consideration per share actually received by holders of Common Shares. The Corporation
shall notify Holders of the weighted average as soon as practicable after such determination is made. The
provisions of this Section shall apply similarly and equally to successive Corporate Events and shall be applied
without regard to any limitations on the conversion of the Series A Preferred Shares.
Right of the Holders to Convert to Series A-1 and Series A-2 Preferred Shares; Corporation’s Option to Redeem Upon Such Re- quest.
Conversion to Series A-1. Each Holder shall have the right, at such Holder’s option on or prior to the thirtieth (30th)
day immediately preceding the fourth (4th) anniversary of the Issuance Date, but not prior to the date that is sixty
(60) days prior to such date, subject to the conver- sion procedures set forth in Section (10)(e) and the
Corporation’s right to effect a Corporation Dividend Increase Redemption pursuant to Section (11)(b)(iii), to convert
each Series A Prefer- red Share of such Holder into one Series A-1 Preferred Share (as defined below) (the “Series
A-
1 Conversion Right”). The right of conversion may be exercised as to all or any portion of such
Holder’s Series A Preferred Shares; provided that, in each case, no right of conversion may be exercised by a
Holder in respect of less than one (1) Series A Preferred Share (as adjusted for any share dividend, share split,
share combination, reclassification or similar transaction rela- ting to the Series A Preferred Shares occurring after
the Subscription Date). On the fourth (4th) anniversary of the Issuance Date (the “Series A-1 Conversion Date”), if
the Corporation has not delivered a Corporation Dividend Increase Redemption Notice prior to such date, then the
Corporation shall convert the amount of Series A Preferred Shares specified in the Dividend In- crease Conversion
Notice (as defined in Section (10)(e)), if any, to Series A-1 Preferred Shares as of the Series A-1 Conversion Date.
For the avoidance of doubt, (i) the Conversion Amount of
the Series A-1 Preferred Shares to be issued upon such conversion shall equal the Conversion Amount of the
Series A Preferred Shares submitted for conversion upon exercise of the Series A-1 Conversion Right set forth
herein and (ii) accrued and unpaid Dividends, if any (and any ac- crued and unpaid dividends accrued pursuant to
Section (5)(c)), in respect of Series A Preferred Shares converted for Series A-1 Preferred Shares pursuant to this
Section (10)(a) will be conver- ted into accrued and unpaid Dividends (and any accrued and unpaid dividends
accrued pur- suant to Section (5)(c)), in respect of such Series A-1 Preferred Shares.
Series A-1 Preferred Shares. Upon the Holder exercising its Series A¬1 Conversion Right pur- suant to Section
(10)(a), the Corporation shall on or prior to the Series A-1 Conversion Date create the Series A-1 Preferred Shares
and, upon such creation, the Corporation shall at all times reserve and keep available out of its authorized and
unissued Senior Preferred Shares, solely for designation as Series A-1 Senior Preferred Shares (each, a “Series A-
1 Preferred
Share” and collectively, the “Series A-1 Preferred Shares”) to be issued upon the conversion
of the Series A Preferred Shares, such number of Senior Preferred Shares as shall from time to time be equal to
the number of Series A-1 Preferred Shares issuable upon the conversion of all the Series A Preferred Shares then
outstanding. Any Series A-1 Preferred Shares issued upon conversion of Series A Preferred Shares shall be duly
authorized, validly issued, fully paid and
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 24 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
nonassessable.
Conversion to Series A-2. Each Holder shall have the right, at such Holder’s option on or prior to the thirtieth (30th)
day immediately preceding the ninth (9th) anniversary of the Issuance Date, but not prior to the date that is sixty
(60) days prior to such date, subject to the conver- sion procedures set forth in Section (10)(e) and the
Corporation’s right to effect a Corporation Dividend Increase Redemption pursuant to Section (11)(b)(iii), to convert
each of such Holder’s Series A Preferred Share and/or Series A-1 Preferred Share into a Series A-2 Preferred
Share
(as defined below) (the “Series A-2 Conversion Right”). The right of conversion may be exerci-
sed as to all or any portion of such Holder’s Series A Preferred Shares and/or Series A-1 Prefer- red Shares;
provided that, in each case, no right of conversion may be exercised by a Holder in respect of less than one (1)
Series A Preferred Share (as adjusted for any share dividend, share split, share combination, reclassification or
similar transaction relating to the Series A Prefer- red Shares occurring after the Subscription Date) and/or one (1)
Series A¬1 Preferred Share (as adjusted for any share dividend, share split, share combination, reclassification or
similar tran- saction relating to the Series A-1 Preferred Shares occurring after the Subscription Date). On the ninth
(9th) anniversary of the Issuance Date (the “Series A-2 Conversion Date” and together
with the Series A-1 Conversion Date a “Dividend Increase Conversion Date”), if the Corpora-
tion has not delivered a Corporation Dividend Increase Redemption Notice prior to such date, then the Corporation
shall convert the amount of Series A Preferred Shares and/or Series A-1 Preferred Shares, as applicable, specified
in the Dividend Increase Conversion Notice to Series A-2 Preferred Shares as of the Series A-2 Conversion Date.
For the avoidance of doubt, (i) the Conversion Amount of the Series A-2 Preferred Shares to be issued upon such
conversion shall equal the Conversion Amount of the Series A Preferred Shares and/or the Series A-1 Preferred
Shares submitted for conversion upon exercise of the Series A-2 Conversion Right set forth he- rein, (ii) the Series
A-2 Conversion Right entitles (x) a Holder to convert all or some of such Hol- der’s Series A Preferred Shares into
Series A-2- Preferred Shares and (y) a holder of Series A-1 Preferred Shares to convert all or some of such
Holder’s Series A-1 Preferred Shares into Series A-2- Preferred Shares and (iii) accrued and unpaid Dividends, if
any (and any accrued and un- paid dividends accrued pursuant to Section (5)(c)), in respect of Series A Preferred
Shares or Se- ries A-1 Preferred Shares, as the case may be, converted for Series A-2 Preferred Shares pur-
suant to this Section (10)(c) will be converted into accrued and unpaid Dividends (and any ac- crued and unpaid
dividends accrued pursuant to Section (5)(c)), in respect of such Series A-2 Preferred Shares.
Series A-2 Preferred Shares. Upon the Holder exercising its Series A¬2 Conversion Right pur- suant to Section
(10)(c), the Corporation shall on or prior to the Series A-2 Conversion Date create the Series A-2 Preferred Shares
and, upon such creation, the Corporation shall at all times reserve and keep available out of its authorized and
unissued Senior Preferred Shares, solely for designation as Series A-2 Senior Preferred Shares (each, a “Series
A-2 Preferred Share” and collectively, the “Series A-2 Preferred Shares”), to be issued upon the conversion of the
Series A Preferred Shares and/or Series A-1 Preferred Shares, such number of Series A-2 Preferred Shares as
shall from time to time be equal to the number of Series A Preferred Shares and Series A-1 Preferred Shares
issuable upon the conversion of all Series A Preferred
Shares and Series A-1 Preferred Shares then outstanding. Any Series A-2 Preferred Shares is- sued upon
conversion of Series A Preferred Shares and/or Series A-1 Preferred Shares, as ap- plicable, shall be duly
authorized, validly issued, fully paid and nonassessable.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 25 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Exhibit 3.1
Optional Redemptions.
Notice of Intended Conversion. To exercise its Series A-1 Conversion Right or its Series A-2 Conversion Right,
a Holder shall, not less than thirty (30) days prior to the fourth (4th) or ninth (9th) anniversary of the Issuance
Date, as applicable, but not prior to the date that is sixty (60) days prior to such date, (A) deliver a written
notice executed by the registered Holder of the Se- ries A Preferred Shares and/or Series A-1 Preferred
Shares, as applicable, subject to such conversion (a “Dividend Increase Conversion Notice”) to the Corporation,
which Dividend In- crease Conversion Notice shall indicate the amount of Series A Preferred Shares and/or
Series A-1 Preferred Shares, as applicable, such Holder is electing to convert pursuant to Sec- tions (10)(a) or
(c), as applicable; and (B) deliver to the Corporation funds for the payment of any applicable share transfer,
documentary, stamp or similar taxes.
Series A-1 and B-2 Articles of Amendment. If a Holder validly delivers a Dividend Increase Conversion Notice
and the Corporation does not exercise its right to redeem pursuant to Sec- tion (11)(b)(iii) with respect to all
Series A Preferred Shares and/or Series A-1 Preferred Shares, as applicable, specified in the Holder’s
Dividend Increase Conversion Notice, then the Corpora- tion shall, prior to the Dividend Increase Conversion
Date, file Articles of Amendment setting forth the designation, preferences and rights of the Series A-1
Preferred Shares or Series A-2 Preferred Shares, as applicable, which Articles of Amendment will be in the
same form as these Articles of Continuance, except for changes (i) to account for the different series, different
dates, including issuance dates, and changes in law, (ii) in the case of the Series A-1 Preferred Shares Articles
of Amendment, to Sections (10) and (11) to, among other things, account for the right of Series A-1 Preferred
Shares to convert into Series A-2 Preferred Shares, to reserve an adequate amount of Senior Preferred
Shares to accommodate such conversion right and to provide a redemption right by the Corporation analogous
to the rights in Section (11)(b)(iii) to provide for the Corporation’s right to redeem the Series A-1 Preferred
Shares upon a Holder exercising its right to convert Series A-1 Preferred Shares into Series A-2 Preferred
Shares and, in the case of the Series A-2 Preferred Shares Articles of Amendment, to eliminate this Sec- tion
(10) conversion right for the Series A-2 Preferred Shares and the corresponding Corpora- tion redemption right
in Section (11)(b)(iii) and (iii) to the Preferential Dividend Rate, which with respect to the Series A-1 Preferred
Shares shall replace “5.50%” with “7.50%”, and with respect to the Series A-2 Preferred Shares shall replace
“5.50%” or “7.50%”, as the case may be, with the fixed percentage equal to the greater of (x) 600 bps over the
Daily Simple SOFR as in effect on the first date a Holder validly delivers a Dividend Increase Conversion
Notice in respect of its Series A-2 Conversion Right to the Corporation and (y) 10.50%. The Series A-1
Preferred Shares and Series A-2 Preferred Shares shall have the same preferences, rights and obligations as
the Series A Preferred Shares, other than solely with respect to the Preferential Dividend Rate. For the
avoidance of doubt, Dividends on the Series A-1 Preferred Shares and on the Series A-2 Preferred Shares
shall start to accrue as of the applicable Dividend Increase Conversion Date.
General. Other than as specifically permitted by these Articles of Continuance, the Corporation may not
redeem any of the outstanding Series A Preferred Shares (it being understood that the Corporation may
purchase Series A Preferred Shares in the open market or in negotiated tran- sactions).
Redemption at the Option of the Corporation.
Corporation Optional Redemption. At any time after February 1, 2032, so long as
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 26 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
there is no Equity Conditions Failure on the applicable Corporation Optional Redemp- tion Date (as
defined below), the Corporation shall have the right to redeem all or any portion of the Series A Preferred
Shares then outstanding as designated in the appli- cable Corporation Optional Redemption Notice (as
defined below) (the “Corporation
Optional Redemption Shares”) on the applicable Corporation Optional Redemption
Date (a “Corporation Optional Redemption”). Each Corporation Optional Redemp- tion Share shall be
redeemed by the Corporation on the applicable Corporation Op- tional Redemption Date in cash, without
interest, at a price equal to 100% of the Conversion Amount of such Corporation Optional Redemption
Share plus accrued and unpaid Dividends thereon, if any (and any accrued and unpaid dividends
thereon accrued pursuant to Section (5)(c)) (the “Corporation Optional Redemption Price”). The Corporation
may exercise its right to redeem the Corporation Optional Redemp- tion Shares under this Section (11)
(b)(i) by delivering a written notice thereof to all, but not less than all, of the Holders (a “Corporation
Optional Redemption Notice” and
the date the Corporation delivers such notice to all Holders is referred to as a “Corpo-
ration Optional Redemption Notice Date”). Each Corporation Optional Redemption Notice shall be
irrevocable. Each Corporation Optional Redemption Notice shall (A) state the date on which the
applicable Corporation Optional Redemption shall occur (a “Corporation Optional Redemption Date”), which
date shall be the forty fifth (45th) day (or, if such date falls on a day that is not a Business Day, the next
day that is a Business Day) following the applicable Corporation Optional Redemption Notice Date, (B)
state the number of the Series A Preferred Shares which the Corpora- tion has elected to redeem from
the Holders on the applicable Corporation Optional Redemption Date and (C) confirm that there is no
Equity Conditions Failure on the ap- plicable Corporation Optional Redemption Notice Date.
Corporation Merger Termination Redemption. If the Merger Agreement is terminated in accordance with
its terms and all confidential information that constitutes material, nonpublic information communicated
by the Corporation, any of its Subsidiaries or any of their respective Affiliates, employees, officers,
representatives or agents to the Buyers (as defined in the Securities Purchase Agreement) or any of their
Affiliates has been publicly disclosed, then during the ninety (90) days following the later of (x) Au- gust
7, 2023 and (y) the termination of the Merger Agreement, so long as there is no Equity Conditions Failure
on the applicable Corporation Merger Termination Redemp- tion Notice Date (as defined below), the
Corporation shall have the right to redeem between fifty percent (50%) and one hundred percent (100%)
of the Series A Preferred Shares then outstanding as designated in the applicable Corporation Merger
Termi-
nation Redemption Notice (as defined below) (the “Corporation Merger Termination
Redemption Shares”) on the applicable Corporation Merger Termination Redemp- tion Date (a “Corporation
Merger Termination Redemption”). Each Corporation Merger Termination Redemption Share shall be
redeemed by the Corporation on the
Corporation Merger Termination Redemption Date in cash, without interest, at a price equal to 102% of
the sum of (x) the Conversion Amount of such Corporation Merger Termination Share and (y) accrued
and unpaid Dividends thereon, if any (and any ac- crued and unpaid dividends thereon accrued pursuant
to Section (5)(c)) (the “Corpo-
ration Merger Termination Redemption Price”). The Corporation may exercise its
right to redeem the Corporation Merger Termination Redemption Shares by delive-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 27 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
ring a written notice thereof to all, but not less than all, of the Holders (a “Corporation Merger Termination
Redemption Notice” and the date the Corporation delivers such notice to all Holders is referred to as a
“Corporation Merger Termination Redemp-
tion Notice Date”). Each Corporation Merger Termination Redemption Notice shall
be irrevocable. Each Corporation Merger Termination Redemption Notice shall (A) state the date on
which the applicable Corporation Merger Termination Re- demption shall occur (a “Corporation Merger
Termination Redemption Date”), which date shall be the tenth (10th) day (or, if such date falls on a day that
is not a Bu- siness Day, the next day that is a Business Day) following the applicable Corporation Merger
Termination Redemption Notice Date, (B) state the number of the Series A Preferred Shares which the
Corporation has elected to redeem from the Holders on the Corporation Merger Termination Redemption
Date, and (C) confirm that there is no Equity Conditions Failure on the applicable Corporation Merger
Termination Re-
demption Notice Date.
Corporation Redemption Upon Dividend Increase. If one or more Holders delivered a Dividend Increase
Conversion Notice to the Corporation in compliance with Sec- tion (10), so long as there is no Equity
Conditions Failure on the applicable Corpora- tion Dividend Increase Redemption Date (as defined
below), the Corporation shall have the right to redeem all or any portion of the Series A Preferred Shares
and/or Se- ries A-1 Preferred Shares, as applicable, for which an increase in the Preferential Divi- dend
Rate has been demanded, as designated in the applicable Corporation Dividend
Increase Redemption Notice (as defined below) (such shares the “Corporation Divi-
dend Increase Redemption Shares”) on the applicable Corporation Dividend In- crease Redemption Date (a
“Corporation Dividend Increase Redemption”). The Cor- poration Dividend Increase Redemption Shares
shall be redeemed by the Corporation
on the applicable Corporation Dividend Increase Redemption Date in cash, without in- terest, at a price
equal to 100% of the Conversion Amount of the Corporation Divi- dend Increase Redemption Shares to
be redeemed plus accrued and unpaid Divi- dends thereon, if any (and any accrued and unpaid
dividends thereon accrued pur- suant to Section (5)(c)) (a “Corporation Dividend Increase Redemption
Price”). The Corporation may exercise its right to require redemption under this Section (11)(b)(iii) by
delivering a written notice thereof by no later than the forty fifth (45th) day immediately following the
fourth (4th) anniversary of the Issuance Date or the ninth (9th) anniversary of the Issuance Date, as
applicable (or, if such date
falls on a day that is not a Business Day, the next day that is a Business Day), to all, but not less than all,
of the Holders who delivered a Dividend Increase Conversion No- tice to the Corporation in compliance
with this Section (11)(b)(iii) (a “Corporation Divi-
dend Increase Redemption Notice”, and the date such notice is given to all of the
Holders is referred to as a “Corporation Dividend Increase Redemption Notice Date”). Each Corporation
Dividend Increase Redemption Notice shall be irrevocable. Each Corporation Dividend Increase
Redemption Notice shall (A) state the date on which the applicable Corporation Dividend Increase
Redemption shall occur (a “Cor- poration Dividend Increase Redemption Date”), which date shall be the forty
fifth
(45th) day (or, (x) if such date falls on a day that is not a Business Day, the next day that is a Business
Day or (y) if there is an Equity Conditions Failure on such day, the first Business Day thereafter upon
which there is no Equity Conditions Failure; provi-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 28 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
ded that such Business Day occurs no later than the forty fifth (45th) day thereafter (the “Extended
Dividend Increase Redemption Date”); provided, further, that in the event of clause (y) such Holder may
elect to revoke its election to convert its Series A Preferred Shares into Series A-1 Preferred Shares or
Series A¬2 Preferred Shares, as applicable, and consequently revoke the Corporation’s right to effect a
related Corpo- ration Dividend Increase Redemption) following the applicable Corporation Dividend
Increase Redemption Notice Date, (B) state the aggregate Conversion Amount of the Series A Preferred
Shares and/or Series A-1 Preferred Shares, as applicable, which the Corporation has elected to redeem
from the Holders on the applicable Corporation
Dividend Increase Redemption Date, (C) state the amount of accrued and unpaid Divi- dends, if any (and
any accrued and unpaid dividends accrued pursuant to Section (5)(c)), with respect to such Series A
Preferred Shares redeemed by the Cor- poration pursuant to this Section (11)(b)(iii) and (D) confirm that
there is no Equity Conditions Failure as of the applicable Corporation Dividend Increase Redemption
Notice Date.
Corporation Redemptions. If the Corporation confirmed that there was no Equity Conditions Failure as of
the applicable Corporation Redemption Notice Date but an Equity Conditions Failure occurs between the
applicable Corporation Redemption No- tice Date and the applicable Corporation Redemption Date (a
“Corporation Redemp-
tion Interim Period”) that the Corporation expects will last through the applicable
Corporation Redemption Date, the Corporation shall provide the Holders a sub- sequent written notice to
that effect. If there is an Equity Conditions Failure on the ap- plicable Corporation Redemption Date (and,
with respect to Section (11)(b)(iii), the Ex- tended Dividend Redemption Date), then the applicable
Corporation Redemption shall be null and void with respect to all or any part designated by such Holder
of the applicable unconverted Corporation Redemption Shares and such Holder shall be en- titled to all
the rights of a Holder with respect to such applicable Corporation Re- demption Shares; provided,
however, that if a Holder waives in writing an Equity Conditions Failure during the applicable Corporation
Redemption Interim Period, then the Corporation shall be required to proceed with the applicable
Corporation Re- demption Date with respect to such Holder. If the Corporation elects to cause a Cor-
poration Redemption pursuant to this Section (11), then it must simultaneously take the same action in
the same proportion with respect to all Corporation Redemption Shares subject to the applicable
Corporation Redemption to the extent practicable, or, if the pro rata basis is not practicable for any
reason, by lot or such other equitable method as the Corporation determined in good faith. If the
applicable Corporation Redemption Notice shall have been duly given, the Corporation shall irrevocably
de- posit or set aside the aggregate Corporation Redemption Price to be paid to all Hol- ders of the
Corporation Redemption Shares entitled thereto and, from and after the applicable Corporation
Redemption Date, the applicable Corporation Redemption Price shall promptly be paid to all former
Holders of Corporation Redemption Shares entitled thereto in respect thereof. So long as the applicable
aggregate Corporation Redemption Price shall be paid in full to such Holders or is irrevocably deposited
or set aside with a depository for payment to the Holders, the applicable Corporation Redemption shall
be effective with respect to all Corporation Redemption Shares on the applicable Corporation
Redemption Date, and thereupon Dividends with respect to such Corporation Redemption Shares shall
cease to accrue and all rights with res-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 29 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
pect to such Corporation Redemption Shares shall forthwith terminate. Notwithstan- ding anything to the
contrary in these Articles of Continuance, until the applicable Corporation Redemption Price is paid in
full, the Series A Preferred Shares subject to the applicable Corporation Redemption may be converted,
in whole or in part, by such Holder into Common Shares pursuant to Section (6). All Series A Preferred
Shares converted by a Holder after a Corporation Redemption Notice Date shall re- duce the number of
Series A Preferred Shares required to be redeemed on the appli- cable Corporation Redemption Date,
unless such Holder otherwise indicates in the applicable Conversion Notice.
Void Redemption. In the event that the Corporation does not pay a Corporation Redemption Price within the
applicable time period, at any time thereafter and until the Corporation pays such unpaid applicable Corporation
Redemption Price in full, a Holder shall have the option to, in lieu of redemption, require the Corporation to
promptly return to such Holder any or all of the Series A Preferred Shares that were submitted for redemption by
such Holder and for which the applicable Corporation Redemption Price has not been paid, by sending written no-
tice thereof to the Corporation (the “Void Optional Redemption Notice”). Upon the Corpora-
tion’s receipt of such Void Optional Redemption Notice prior to the payment of the applicable Corporation
Redemption Price, (i) any applicable redemption notice of such Holder or the Cor- poration, as the case may be,
shall be null and void with respect to those Series A Preferred Shares subject to the Void Optional Redemption
Notice and (ii) the Corporation shall immedia- tely return any Series A Preferred Shares subject to the Void
Optional Redemption Notice.
Effect of Redemption. Subject to Section (11)(c), effective immediately prior to the close of busi- ness on the day
before any Series A Preferred Shares are redeemed pursuant to these Articles of Continuance, Dividends shall no
longer accrue or be declared on any such Series A Preferred Shares, and such Series A Preferred Shares shall
cease to be outstanding.
Status of Redeemed Shares. Series A Preferred Shares redeemed in accordance with these Ar- ticles of
Continuance shall return to the status of and constitute authorized but unissued Se- nior Preferred Shares, without
classification as to series until such shares are once more classi- fied as to a particular series by the Board
pursuant to provisions of the Articles.
Reservation of Shares. The Corporation shall have sufficient authorized and unissued Common Shares for each of the Series A Preferred Shares
equal to no less than the lesser of (x) the Exchange Cap and (y) 110% of the maximum number of Common Shares issuable with respect to the
outstanding Series A Preferred Shares pursuant to the terms of these Articles of Continuance (assuming for purposes of this clause (y), that the
Conversion Amount of the Series A Preferred Shares are convertible at the Conversion Rate and without taking into account any limitations on the
conversion of the Series A Preferred Shares set forth in these Articles of Continuance) (the “Required Reserved Amount”). The Corporation shall, so long
as any of the Series A Prefer- red Shares are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued
Common Shares, solely for the purpose of issuing Common Shares with respect of the Series A Preferred Shares pursuant to the terms of these
Articles of Continuance, no less than a number of Common Shares equal to the Required Reserved Amount.
Voting Rights. Other than in connection with Parent Shareholders Meeting (as defined in the Merger Agreement), each Holder shall be entitled to the
whole number of votes equal to the number of whole Common Shares into which the aggregate of such Holder’s Series A Preferred Shares would be
convertible on the record date for the vote or consent of shareholders or if no re- cord date is established, at the date such vote or consent is taken,
and shall otherwise have voting rights and consent rights equal to the voting rights and consent rights of the Common Shares to the fullest extent
permitted by law provided, however, that until the HSR Date, with respect to any HSR Holder, such HSR Holder shall only be entitled to vote a number
of Series A Pre-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 30 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
ferred Shares in accordance with the foregoing on any matters relating to the election, designation, removal or replacement of members of the Board
to the extent that such number of Series A Preferred Shares together with such HSR Holder’s Common Shares, if any, other Junior Shares, if any, Pari
Passu Shares, if any, and Senior Preferred Shares of the Corporation, if any, does not exceed the HSR Amount in the aggregate; provided, further,
that the Required Holders, by written notice to the Corporation, may terminate the voting rights set forth in this Section (13) effective at any time from
and after the registration, if any, of the Se- ries A Preferred Shares under the Exchange Act. Except as provided in the immediately preceding
sentence, each Holder shall be entitled to receive the same prior notice of any shareholders’ meeting as is provided to the holders of Common Shares
in accor- dance with the by-laws of the Corporation, as well as prior notice of all shareholder actions to be taken by legally available means in lieu of a
meeting, and shall vote as a class with the holders of Common Shares as if they were a single class of securities upon any matter submitted to a vote
of shareholders, except those matters required by law or by the terms hereof to be submitted to a class vote of the Holders, in which case the Holders
only shall vote as a separate class, or those matters required by law to be submitted to a class vote of solely the holders of Common Shares, in which
case such holders only shall vote as a separate class. Notwithstanding the foregoing, (i) no Holder shall be entitled, in its capacity as Holder of the
Series A Preferred Shares, to vote on the Parent Share Issuance (as defined in the Merger Agreement) and (ii) in no event shall a Holder be entitled to
such number of votes that is greater than the number of whole Series A Preferred Shares held by such Holder at the relevant time.
Series A Preferred Shares Approval Rights. In addition to any other rights provided by law, except where the vote or written consent of the holders of a
greater number of shares is required by law, for as long as any Series A Preferred Shares remain outstanding, the affirmative vote at a meeting duly
called for such purpose or the written consent without a meeting of the Re- quired Holders but not of any other class of the Corporation’s securities,
voting as a single class (and separately from all other classes and series of shares in the capital of the Corporation), shall be required before the
Corporation may:
create (by reclassification or otherwise), or authorize the creation of, or issue or obligate itself to issue additional or
other Senior Shares or securities exchangeable for or convertible or exer- cisable into Senior Shares;
create (by reclassification or otherwise), or authorize the creation of, or issue or obligate itself to issue additional or
other Pari Passu Shares or securities exchangeable for or convertible or exercisable into Pari Passu Shares;
except as contemplated by Section (10), amend or repeal any provision of, or add any provision to, the Articles, or
file any articles of amendment, preferences, limitations and relative rights of any series of preferred shares, if such
action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions of the Series
A Preferred Shares, regardless of whether any such action shall be by means of amendment to the Articles or by
merger, conso- lidation, amalgamation, arrangement or otherwise;
increase or decrease (other than by conversion or redemption in accordance with the terms hereof) the authorized
number of Series A Preferred Shares;
exchange, reclassify or cancel the Series A Preferred Shares, except as explicitly contemplated by these Articles
of Continuance; or
amend or waive any provision of these Articles of Continuance that would have an adverse ef- fect on the rights,
preferences, privileges, voting power or obligation of the Series A Preferred Shares or any Holder thereof.
Notwithstanding the provisions of this Section (14), (a) in the event of a Fundamental Transaction or Corporate Event, so long as: (i) the
Series A Preferred Shares remain outstanding following consummation of such Fundamental Transaction or Corporate Event with its terms
materially unchanged, taking into account that, upon the occurrence of such a Funda-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 31 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
mental Transaction or Corporate Event, the Corporation may not be the surviving entity (in which case, the Series A Pre- ferred Shares may
be converted into or exchanged for preferred shares or other preferred equity of the surviving entity or its parent having terms substantially
the same as the Series A Preferred Shares) and, if applicable, with any changes to the terms of the Series A Preferred Shares required
pursuant to and made in compliance with the provisions of Sec- tion (9)(c) in connection with such Fundamental Transaction or Corporate
Event or as otherwise deemed reasonably ne- cessary by the Corporation and (ii) if such transaction also constitutes a Change of Control,
the provisions of Sec- tion (9)(a) and Section (9)(b) are complied with in connection with such Fundamental Transaction, then the occurrence
of such Fundamental Transaction shall not be deemed to adversely affect the powers, preferences, or other special rights or privileges of the
Series A Preferred Shares or its Holders and in such case such Holders shall not have any voting rights with respect to the occurrence of
such Fundamental Transaction or Corporate Event pursuant to this Sec- tion (14) and (b) the authorization or creation of, or the increase in
the number of authorized or issued shares of, or any securities convertible into shares of, or the reclassification of any security (in each case,
other than the Series A Prefer- red Shares) into, or the issuance of, Junior Shares will not require the vote the holders of the Series A
Preferred Shares.
General Provisions.
In addition to the above provisions with respect to Series A Preferred Shares, the Series A Pre- ferred Shares shall
be subject to and be entitled to the benefit of the provisions set forth in the Articles with respect to preferred shares
of the Corporation generally; provided, however, that in the event of any conflict between such provisions, the
provisions set forth in these Articles of Continuance shall control.
Any Series A Preferred Shares which are converted, repurchased or redeemed shall be auto- matically and
immediately retired and shall not be reissued, sold or transferred.
Whenever notice is required to be given under these Articles of Continuance, unless otherwise provided herein,
such notice shall be given by first-class mail to each record Holder of outstan- ding Series A Preferred Shares as
such Holder’s address as the same appears on the books of the Corporation or the Transfer Agent. With respect to
any notice to a Holder required to be provided hereunder, neither the failure to mail such notice, nor any defect
therein or in the mailing thereof, to any particular Holder shall affect the sufficiency of the notice or the validity of
the proceedings referred to in such notice with respect to the other Holders or affect the le- gality or validity of any
distribution, rights, warrant, reclassification, consolidation, merger, amalgamation, arrangement, conveyance,
transfer, dissolution, liquidation or winding up, or the vote upon any such action. Any notice which was mailed in
the manner herein provided shall be conclusively presumed to have been duly given or delivered as of the date
sent whe- ther or not the Holder receives the notice. All notice periods referred to herein shall commence on the
date of the mailing of the applicable notice.
Whenever any amount expressed to be due by the terms of these Articles of Continuance is due on any day which
is not a Business Day, the same shall instead be due on the next succee- ding day which is a Business Day
without interest or penalty.
If any term of the Series A Preferred Shares set forth herein is invalid, unlawful or incapable of being enforced by
reason of any rule of law or public policy, all other terms set forth herein which can be given effect without the
invalid, unlawful or unenforceable term will, neverthe- less, remain in full force and effect, and no term herein set
forth will be deemed dependent upon any other such term unless so expressed herein so long as these Articles of
Continuance as so modified continues to express, without material change, the original intentions of the
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 32 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in
question does not substantially impair the respective expectations or reci- procal obligations of the parties or the
practical realization of the benefits that would other- wise be conferred upon the parties. The Corporation and the
Required Holders will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable
provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited, in-
valid or unenforceable provision(s).
It is the intent of the Corporation and the Required Holders that the provisions of these Articles of Continuance
comply, and following the date hereof continue to comply, with the applicable rules of The New York Stock
Exchange and The Toronto Stock Exchange, as the same may be amended from time to time, for as long as long
as the Corporation’s Common Shares are listed and posted for trading on The New York Stock Exchange and/or
The Toronto Stock Exchange, as the case may be (the “Applicable Stock Exchange Rules”). It is also the intent of the
Corpo- ration and the Required Holders that if the Corporation no longer has a class of securities re- gistered
under section 12 of the Exchange Act or is no longer required to file reports
under Section 15(d) of the Exchange Act, all Exchange Act, Securities Act and other United States references
herein shall be deemed to be to the Canadian equivalent, including under applicable Canadian securities laws. In
furtherance of the foregoing, if any term, covenant or restriction included in these Articles of Continuance fails at
any time to comply with the Appli- cable Stock Exchange Rules, or it is reasonably necessary and advisable to
update the United States references to applicable Canadian references, the Corporation and the Required Hol-
ders agree to negotiate in good faith to modify these Articles of Continuance so as to comply with the Applicable
Stock Exchange Rules or to update with the applicable Canadian references while retaining the original intent as
closely as possible in an acceptable manner so that the transactions contemplated hereby be consummated as
originally contemplated to the fullest extent possible. Any amendment, modification or alteration of the rights,
preferences, privi- leges or voting powers of the Series A Preferred Shares shall, solely to the extent required by
the Applicable Stock Exchange Rules, be subject to the approval of The New York Stock Ex- change and/or The
Toronto Stock Exchange, as the case may be for as long as the Common Shares are listed for trading thereon.
Tax Matters.
Tax Withholdings. The Corporation shall be entitled to withhold or deduct, from any amounts payable or
otherwise deliverable under these Articles of Continuance, such amounts as the Corporation determines,
acting reasonably, are required to be deduc- ted or withheld with respect to such payment or delivery
under the Internal Revenue Code of 1986, as amended, the Income Tax Act (Canada) or any provision of any
other applicable laws. To the extent that such amounts are so deducted or withheld, such amounts shall
be treated for all purposes as having been paid to the Holder to whom such amounts would otherwise
have been paid, provided that such deducted or with- held amounts are remitted to the appropriate
governmental authority. The Corpora- tion is hereby authorized to sell or otherwise dispose of, on behalf
of any Holder, such portion of any share or other security deliverable to such Holder as is necessary to
provide sufficient funds to the Corporation to enable it to comply with such deduction or withholding
requirement and the Corporation shall notify such Holder thereof and remit the applicable portion of the
net proceeds of such sale to the appropriate go-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 33 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
vernmental authority and, if applicable, any portion of such net proceeds that is not required to be so
remitted shall be paid to such Holder. The Holders shall, on a joint and several basis, indemnify and hold
harmless the Corporation for any losses, costs, penalties, fees, liabilities, damages and expenses
incurred by the Corporation in res- pect of a failure to withhold, deduct, or remit any amount required to
be withheld, de- ducted, or remitted in respect of any amounts payable pursuant to these Articles of
Continuance.
Forms. If a Holder is entitled to claim an exemption or reduction from withholding tax in accordance with
applicable law, such Holder shall promptly deliver such properly completed and executed documentation
(including properly completed Canada Reve- nue Agency forms NR301, NR 302 or NR 303, as
applicable) reasonably requested by the Corporation as will permit such payments to be made without
withholding or at a reduced rate of withholding. The Corporation shall, acting reasonably, take into ac-
count all such properly completed forms in determining its withholding obligations under Section (15)(g)
(i). In addition, any Holder shall deliver such other tax documen- tation prescribed by applicable law
(including any Internal Revenue Service form W-9 or form W-8, as applicable, or any forms or other
documentation as may be necessary for the Corporation to comply with its obligations under the Foreign
Account Tax Com- pliance Act or otherwise reasonably requested by the Corporation). Each Holder shall
provide new documentation (or successor documentation) upon the expiration or ob- solescence of any
previously delivered documentation and promptly notify the Corpo- ration of any change in
circumstances which would modify or render invalid any clai- med exemption or reduction.
Specified Amount. The specified amount in respect of the Series A Preferred Shares for purposes of
subsection 191(4) of the Income Tax Act (Canada) is the Canadian Dol- lar equivalent of US$1.00 per
Series A Preferred Share as of the date of issuance of such share.
Transfer of Series A Preferred Shares. A Holder may transfer some or all of the Series A Preferred Shares and the accompanying rights hereunder
held by such Holder without the consent of the Corporation; provided that such transfer is in compliance with applicable securities laws and the
Securities Purchase Agreement.
Series A Preferred Share Register.
The Corporation or the Transfer Agent shall maintain a register for the Series A Preferred Shares, in which the
Corporation or the Transfer Agent shall record the name and address of the Persons in whose name the Series A
Preferred Shares have been issued, as well as the name and address of each transferee. The Corporation may
treat the Person in whose name any Series A Preferred Share is registered on the register as the owner and
holder thereof for all purposes, notwithstanding any notice to the contrary, but in all events recognizing any pro-
perly made transfers.
The Corporation or the Transfer Agent shall maintain records showing the number of Series A Preferred Shares
converted and/or redeemed and the dates of such conversions and/or re- demptions. In the event of any dispute
or discrepancy, such records of the Corporation establi- shing the number of Series A Preferred Shares to which
the record holder is entitled shall be controlling and determinative in the absence of manifest error.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 34 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Certain Defined Terms. For purposes of these Articles of Continuance the following terms shall have the following meanings: “Affiliate” shall have the
meaning ascribed to such term in Rule 405 of the Securities Act.
“Bloomberg” means Bloomberg Financial Markets.
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of
New York or Toronto, Ontario, Canada are authorized or required by law to remain closed; provided, however, for
clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to
“stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the
closure of any physi- cal branch locations at the direction of any governmental authority so long as the electronic
funds transfer systems (including for wire transfers) of commercial banks in The City of New York, New York or
Toronto, Ontario, Canada generally are open for use by customers on such day.
“Calendar Quarter” means each of: the period beginning on and including December 15 and ending on and including
March 14; the period beginning on and including March 15 and ending on and including June 14; the period
beginning on and including June 15 and ending on and in- cluding September 14; and the period beginning on and
including September 15 and ending on and including December 14.
“Change of Control” means any Fundamental Transaction other than (i) any reorganization, re- capitalization,
reclassification or change of the Common Shares or any share exchange, conso- lidation, amalgamation,
arrangement, merger or similar transaction, in each case, in which hol- ders of the Corporation’s voting power
immediately prior to such reorganization, recapitaliza- tion, reclassification, change, share exchange,
consolidation, amalgamation, arrangement, mer- ger or similar transaction continue immediately after the
consummation of such reorganiza- tion, recapitalization, reclassification, change, share exchange, consolidation,
amalgamation, arrangement, merger or similar transaction to hold publicly traded securities and, directly or
indirectly, the voting power of the surviving entity or entities necessary to elect a majority of the members of the
board of directors (or their equivalent if other than a corporation) of such entity or entities, or (ii) pursuant to a
continuance or migratory merger, amalgamation or ar- rangement effected solely for the purpose of changing the
jurisdiction of incorporation of the Corporation.
“Change of Control As-Converted Value” means, with respect to any Series A Preferred Shares, the product of (i) the
Conversion Amount of such Series A Preferred Shares multiplied by (ii) the Conversion Rate multiplied by (iii) the
Make-Whole Share Price with respect to the ap- plicable Change of Control.
“close of business” means 5:00 p.m. (New York City time).
“Closing Sale Price” of the Common Shares (or other security for which a closing sale price must be determined) on
any date means the closing sale price per share (or if no closing sale price is reported, the average of the bid and
ask prices or, if more than one in either case, the average of the average bid and the average ask prices) on that
date as reported in composite transactions for the principal U.S. national or regional securities exchange on which
the Com- mon Shares (or such other security) is traded. If the Common Shares (or such other security) is
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 35 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
not listed for trading on a U.S. national or regional securities exchange on the relevant date, the “Closing Sale
Price” shall be the last quoted bid price for the Common Shares (or such other security) in the over-the-counter
market on the relevant date as reported by OTC Markets Group Inc. or a similar organization. If the Common
Shares (or such other security) are not so quoted, the “Closing Sale Price” shall be the average of the mid-point of
the last bid and ask prices for the Common Shares (or such other security) on the relevant date from each of at
least three nationally recognized independent investment banking firms selected by the Corpo- ration for this
purpose. The “Closing Sale Price” will be determined without regard to after- hours trading or any other trading
outside of the regular trading session hour.
“Common Shares” means (i) the Corporation’s shares of common shares, without par value, or
(ii) any share capital into which such Common Shares shall have been converted or exchanged in a Corporate
Event.
“Conversion Amount” means, for each Series A Preferred Share, the Issue Price.
“Conversion Date” means with respect to a conversion pursuant to Section (6)(a), the date on which the Holder
complied with the procedures in Section (6)(c)(i) thereof.
“Conversion Price” means at any time, US$1.00, divided by the Conversion Rate at such time.
“Conversion Rate” means 0.0136986 Common Shares per US$1.00 Conversion Amount, sub- ject to adjustment as
set forth herein.
“Corporation Redemption” means, collectively, a Corporation Dividend Increase Redemption, a Corporation Optional
Redemption and a Corporation Merger Termination Redemption.
“Corporation Redemption Date” means a Corporation Dividend Increase Redemption Date, a Corporation Optional
Redemption Date and a Corporation Merger Termination Redemption Date, as applicable.
“Corporation Redemption Notice” means a Corporation Dividend Increase Redemption No- tice, a Corporation
Optional Redemption Notice and a Corporation Merger Termination Re- demption Notice, as applicable.
“Corporation Redemption Notice Date” means a Corporation Dividend Increase Redemption Notice Date, a
Corporation Optional Redemption Notice Date and a Corporation Merger Termi- nation Redemption Notice Date,
as applicable.
“Corporation Redemption Price” means a Corporation Dividend Increase Redemption Price, a Corporation Optional
Redemption Price and a Corporation Merger Termination Redemption Price, as applicable.
“Corporation Redemption Shares” means, collectively, the Corporation Dividend Increase Re- demption Shares, the
Corporation Optional Redemption Shares and the Corporation Merger Termination Redemption Shares.
“Current Market Price” per Common Share, as of any date of determination, means the arith- metic average of the
Weighted Average Price per Common Share for each of the ten (10) consecutive Trading Days ending on the
Trading Day immediately preceding such day, adjusted
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 36 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
to take into account the occurrence during such period of any event described in Section (7).
“Daily Simple SOFR” means the daily Secured Overnight Financing Rate provided by the FRBNY, as the
administrator of the benchmark (or a successor administrator), on the FRBNY’s Website, effective as of the
applicable date of determination.
“Designee” means Starboard Value and Opportunity Master Fund Ltd.
“Distribution Transaction” means any transaction by which a Subsidiary of the Corporation ceases to be a
Subsidiary of the Corporation by reason of the distribution of such Subsidiary’s equity securities to holders of
Common Shares, whether by means of a spin-off, split-off, re- demption, reclassification, exchange, share
dividend, share distribution, rights offering or simi- lar transaction, which equity securities are, or when issued, will
be, listed or admitted for tra- ding on a U.S. national securities exchange.
“effective date” means, for purpose of Section (7)(a), the first date on which Common Shares trade on the
applicable exchange or in the applicable market, regular way, reflecting the rele- vant subdivision, combination or
reclassification, as applicable (provided that, for the avoi- dance of doubt, any alternative trading convention on the
applicable exchange or market in respect of the Common Shares under a separate ticker symbol or CUSIP
number will not be considered “regular way” for purposes of this definition).
“Eligible Market” means the New York Stock Exchange, The Nasdaq Capital Market, The Nas- daq Global Market
or The Nasdaq Global Select Market (or any of their respective successors).
“Equity Conditions” means each of the following conditions: (i) all Common Shares issuable pursuant to the terms
of these Articles of Continuance as the result of a Mandatory Conversion Date, a Preferential Dividend Date or in
respect of a conversion of Series A Preferred Shares that are subject to a Corporation Redemption, as the case
may be, shall be either (x) issuable without restrictive legends and eligible for sale by such Holder without volume
restrictions pur- suant to Rule 144 (or any successor thereto) and without the requirement to be in compliance with
Rule 144(c)(1) (or any successor thereto) and without the need for registration under any applicable federal or
state securities laws or the need for a prospectus under applicable Cana- dian securities laws or (y) eligible for
resale upon issuance pursuant to an effective Registration Statement contemplated by the Registration Rights
Agreement that is available for use (and ex- pected by the Corporation to be available for use for at least 30
consecutive calendar days af- ter the applicable date of determination) to the extent provided in the Registration
Rights Agreement and, for the avoidance of doubt, not subject to (or expected by the Corporation to be subject to
for at least 30 consecutive calendar days after the applicable date of determina- tion) an “Allowable Grace Period”
(as defined in the Registration Rights Agreement); (ii) the Common Shares referred to in clause (i) requiring the
satisfaction of the Equity Conditions when issued shall be, listed or designated for quotation on an Eligible Market
and shall not have been suspended at such time from trading on such exchange or market; (iii) the Common
Shares referred to in clause (i) requiring the satisfaction of the Equity Conditions, when issued, shall be duly
authorized and (iv) if such Holder converted, in accordance with Section (6)(c), Se- ries A Preferred Shares after
the delivery by Corporation of a Mandatory Conversion Notice or a Corporation Redemption Notice, the
Corporation shall have delivered to such Holder, subject to Section (6)(e), all Common Shares required to be
delivered in respect of such conversions pursuant to Section (6)(c).
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 37 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
“Equity Conditions Failure” means that as of the applicable date of determination the Equity Conditions have not
each been satisfied (or waived in writing by such Holder); provided that the Corporation’s failure to satisfy the
Equity Condition set forth in clause (iv) of the definition of “Equity Conditions” with respect to a particular Holder
shall only be deemed an Equity Condition Failure with respect to such Holder (unless waived in writing by such
Holder).
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Ex-Dividend Date” means, with respect to an issuance, dividend or distribution on the Com- mon Shares, the first
date on which Common Shares trade on the applicable exchange or in the applicable market, regular way, without
the right to receive such issuance, dividend or dis- tribution (including pursuant to due bills or similar arrangements
required by the relevant share exchange). For the avoidance of doubt, any alternative trading convention on the
appli- cable exchange or market in respect of the Common Shares under a separate ticker symbol or CUSIP
number will not be considered “regular way” for this purpose.
“Fair Market Value” means, with (1) respect to any security or other property, the fair market value of such security
or other property as reasonably determined in good faith by a majority of the Board, or an authorized committee
thereof, subject to any required stock exchange ap- proval and (i) after consultation with an Independent Financial
Advisor, as to any security or other property with a Fair Market Value of less than US$50,000,000, or (ii) otherwise
using an Independent Financial Advisor to provide a valuation opinion (2) with respect to U.S. dollars, the face
amount of such U.S. dollars.
“First Mandatory Conversion Period” means the period described in clause (i) of the defini- tion of “Mandatory
Conversion Period” set forth in Section (18)(uu).
“FRBNY” means the Federal Reserve Bank of New York.
“FRBNY’s Website” means the website of the FRBNY at http://www.newyorkfed.org, or any suc- cessor source.
“Fundamental Transaction” means (i) that the Corporation shall, (a) directly or indirectly, in- cluding through
Subsidiaries, Affiliates or otherwise, in one or more related transactions, consolidate, amalgamate or merge with or
into (whether or not the Corporation is the surviving corporation) another Person, or (b) directly or indirectly,
including through Subsidiaries, Affi- liates or otherwise, in one or more related transactions, sell, assign, transfer,
convey or other- wise dispose of all or substantially all of the assets of the Corporation and its Subsidiaries on a
consolidated basis to one or more Persons other than one or more of the Corporation’s Wholly-Owned
Subsidiaries, or (c) directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more
related transactions, make, or allow a Person or Group to make, or allow the Corporation to be subject to or have
its Common Shares be subject to or party to any such Person or Group making, a purchase, tender or exchange
offer that is accepted by the holders of such number of Common Shares such that such Person or Group making
or party to, such purchase, tender or exchange offer, becomes the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act) of at least 50% of the aggregate voting power of the outstanding Common Shares or at
least 50% of the aggregate voting power of the Corporation, or (d) directly or indirectly, including through
Subsidiaries, Affiliates or otherwise, in one or more related transactions, consummate a share purchase
agreement or other business combi-
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 38 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
nation (including, without limitation, a reorganization, recapitalization, spin-off or scheme of ar- rangement) with a
Person or Group (within the meaning of Section 13(d) of the Exchange Act) whereby such Person or Group
acquires such number of Common Shares such that such Per- son or Group becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act) of at least 50% of the aggregate voting power of the outstanding
Common Shares or at least 50% of the aggregate voting power of the Corporation, or (e) directly or indirectly,
inclu- ding through Subsidiaries, Affiliates or otherwise, in one or more related transactions, reorga- nize,
recapitalize or reclassify the Common Shares as a result of which the Common Shares are converted into, or
exchanged for, securities, cash, assets or other property or (ii) that the Cor- poration shall, directly or indirectly,
including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Person or
Group (within the meaning of Sec- tion 13(d) of the Exchange Act) to become the “beneficial owner” (as defined in
Rule 13d-3 un- der the Exchange Act) of at least 50% of the aggregate voting power of the outstanding Com- mon
Shares or at least 50% of the aggregate voting power of the Corporation. Notwithstanding anything to the contrary
in the foregoing, the consummation of the transactions contemplated by the Merger Agreement shall not constitute
a Fundamental Transaction.
“Group” means a “group” as that term is used in Section 13(d) of the Exchange Act and as defi- ned in Rule 13d-5
thereunder.
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and
regulations promulgated thereunder, and any successor to such statute, rules or regulations.
“HSR Amount” means the number of voting securities of the Corporation that may be obtai- ned by an Acquiring
Person (as defined by the HSR Act, including the ultimate parent entity and all entities included within it, and taking
into account any applicable exemptions) prior to the HSR Date, without incurring a notification obligation under the
HSR Act, with the number and class(es) of voting securities constituting the HSR Amount to be determined by the
HSR Holder in consultation with its legal counsel.
“HSR Date” means the date on which all applicable approvals, clearances or waiting periods under the HSR Act
shall have been obtained, expired or been terminated.
“HSR Holder” means a Holder that is an Acquiring Person (as defined under the HSR Act) whose ability to acquire
voting securities of the Corporation in excess of the HSR Amount is restricted by the HSR Act prior to the HSR
Date.
“Independent Financial Advisor” means an accounting, appraisal, investment banking firm or consultant of nationally
recognized standing; provided, however, that such firm or consultant is not an Affiliate of the Corporation.
“Issuance Date” means the Closing Date (as defined in the Securities Purchase Agreement). “Issue Price” means,
per Series A Preferred Share, US$1.00.
“Liquidation Event” means the voluntary or involuntary liquidation, dissolution or winding up of the Corporation or
such Subsidiaries the assets of which constitute all or substantially all of the assets of the business of the
Corporation and its Subsidiaries taken as a whole, in a single transaction or series of transactions, or adoption of
any plan for the same.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 39 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
“Make-Whole Amount” means a cash amount per US$1.00 Conversion Amount of Series A Preferred Shares being
redeemed in a Change of Control Redemption determined by multi- plying the Make-Whole Share Price applicable
to the related Change of Control by a number of additional Common Shares (the “Additional Shares”) as described
below. Such number of Ad- ditional Shares shall be determined by reference to the table below (the “Make-Whole
Table”)
based on the date on which the applicable Change of Control occurs or becomes effective (the “Change of Control
Effective Date”) and the Make-Whole Share Price applicable to such Change of Control.
Change of
Control
Effective
Date
US$59.722
US$65
US$70
US$75
US$80
US$85
US$90
US$100
US$125
US$175
US$250
US$3
February
1, 2023
0.0025100
0.0029600
0.0030456
0.0030456
0.0028600
0.0023300
0.0020400
0.0014000
0.0010400
0.0006400
0.0003900
0.0002
February
1, 2024
0.0026441
0.0030456
0.0030456
0.0030456
0.0029200
0.0023700
0.0020600
0.0014400
0.0008600
0.0004900
0.0002900
0.0001
February
1, 2025
0.0026804
0.0030456
0.0030456
0.0030456
0.0029100
0.0023700
0.0020600
0.0014100
0.0006300
0.0002900
0.0001600
0.0001
February
1, 2026
0.0024719
0.0029200
0.0030456
0.0030456
0.0028100
0.0023000
0.0019900
0.0013200
0.0003600
0.0000000
0.0000000
0.0000
February
1, 2027
0.0022427
0.0027200
0.0030456
0.0030456
0.0026500
0.0021100
0.0018600
0.0012300
0.0003500
0.0000000
0.0000000
0.0000
February
1, 2028
0.0020285
0.0025300
0.0029600
0.0029900
0.0025400
0.0020200
0.0017900
0.0011900
0.0003300
0.0000000
0.0000000
0.0000
February
1, 2029
0.0017580
0.0022800
0.0027000
0.0027400
0.0023100
0.0018200
0.0015900
0.0010700
0.0003100
0.0000000
0.0000000
0.0000
February
1, 2030
0.0013647
0.0018700
0.0023200
0.0023800
0.0019600
0.0015000
0.0013100
0.0008600
0.0002600
0.0000000
0.0000000
0.0000
Les statuts de maintien approuvés ne sont pas complets sans le certificat de maintien. Copie certifiée conforme du
dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 40 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
February
1, 2031
0.0006762
0.0011500
0.0016200
0.0017100
0.0013500
0.0010100
0.0008300
0.0005300
0.0001800
0.0000000
0.0000000 0.0000
February
1, 2032
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000
0.0000000 0.0000
The exact Make-Whole Share Price and Change of Control Effective Date may not be set forth in the Make-Whole Table, in
which case:
(1)
if the Make-Whole Share Price is between two such amounts in the Make-Whole Table or the Change of Control
Effective Date is between two Change of Control Effective Dates in the Make-Whole Table, the number of Additional
Shares will be determined by straight-line interpolation between the number of Additional Shares set forth for the higher
and lower Make-Whole Share Prices and the ear- lier and later Change of Control Effective Dates, as applicable, based on
a 365-day year;
(2)
if the Make-Whole Share Price is greater than $550 (subject to adjustment in the same manner as the Make-Whole
Share Prices set forth in the column headings of the Make-Whole Table), the Make-
Whole Amount will be $0; and
(3)
if the Make-Whole Share Price is less than $59.722 (subject to adjustment in the same manner as the Make-Whole
Share Prices set forth in the column headings of the Make-Whole Table), the Make- Whole Amount will be $0.
The Make-Whole Share Prices set forth in the column headings of the Make-Whole Table shall be adjus- ted as of any date
on which the Conversion Rate is otherwise adjusted in accordance with Section (7). The adjusted Make-Whole Share
Prices shall equal the Make-Whole Share Prices applicable immedia- tely prior to such adjustment, multiplied by a fraction,
the numerator of which is the Conversion Rate immediately prior to such adjustment giving rise to the Make-Whole Share
Price adjustment and the denominator of which is the Conversion Rate as so adjusted. The number of Additional Shares
set forth in the Make-Whole Table shall be adjusted in the same manner and at the same time as the Conver- sion Rate as
set forth in Section (7).
In no event shall the Make-Whole Amount be greater than or less than the maximum and minimum va- lues set forth in the
table above and no Make-Whole Amount shall be paid with respect to a Change of Control occurring on or after February
2, 2032.
“Make-Whole Share Price” means (i) the cash amount paid per Common Share, if the holders of Common Shares
receive only cash in the applicable Change of Control or (ii) in any other si- tuation, the simple average of the
Weighted Average Price of the Common Shares over the five
(5) consecutive Trading Day period ending on, and including, the Trading Day immediately pre- ceding the Change
of Control Effective Date of the Change of Control.
“Mandatory Conversion Measuring Period” means the thirty (30) consecutive Trading Day period following the first
Trading Day of the applicable Mandatory Conversion Period during which the Mandatory Conversion Price
Condition is satisfied.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 41 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
“Mandatory Conversion Period” means each of (i) the period commencing on February 1, 2026 and ending on
February 1, 2030, exclusive and (i) the period from and after February 1, 2030.
“Mandatory Conversion Price Condition” will be deemed satisfied for purposes of these Ar- ticles of Continuance: (i)
with respect to a Mandatory Conversion for which a Mandatory Conversion Notice is delivered in accordance with
Section (6)(d) during the First Mandatory Conversion Period, if the Closing Sale Price of the Common Shares has
equaled or exceeded 190% of the Conversion Price as of the Issuance Date (as adjusted for any share dividend,
share split, share combination, reclassification or similar transaction relating to the Common Shares occurring
after the Issuance Date pursuant to Section (7)) during twenty (20) Trading Days (whether or not consecutive)
occurring in any thirty (30) consecutive Trading Day period occurring on or after February 1, 2026 and ending on
the Trading Day immediately preceding the Mandatory Conversion Notice Date related to such Mandatory
Conversion and (ii) with res- pect to a Mandatory Conversion for which a Mandatory Conversion Notice is
delivered in ac- cordance with Section (6)(d) during the Second Mandatory Conversion Period, if the Closing Sale
Price of the Common Shares has equaled or exceeded 175% of the Conversion Price as of the Issuance Date (as
adjusted for any share dividend, share split, share combination, reclassi- fication or similar transaction relating to
the Common Shares occurring after the Issuance Date pursuant to Section (7)) during twenty (20) Trading Days
(whether or not consecutive) occurring in any thirty (30) consecutive Trading Day period occurring on or after
February 1, 2030 and en- ding on the Trading Day immediately preceding the Mandatory Conversion Notice Date
related to such Mandatory Conversion.
“Merger Agreement” means that certain Agreement and Plan of Merger and Reorganization, dated as of November
7, 2022, by and among the Corporation, IAA, Inc., a Delaware corpora- tion, and the other parties thereto, as may
be amended, amended and restated, supplemented or otherwise modified from time to time.
“Minimum Ownership Threshold” means twenty five percent (25.0%) of the Series A Prefer- red Shares outstanding
as of the applicable date of determination.
“Offer to Repurchase Percentage” means such percentage of Common Shares being redee- med or repurchased by
the Corporation (including Common Shares into which Junior Shares, options or warrants, which are being so
redeemed or repurchased, are convertible, exchan- geable or exercisable) out of the total number of Common
Shares (including Common Shares into which such Junior Shares, options or warrants of the Corporation are
convertible, exchan- geable or exercisable, which are so being redeemed or repurchased) issued and outstanding
(or in respect of any such Junior Shares, options or warrants, which are so being redeemed or repurchased, which
are reserved for issuance upon conversion, exchange or exercise thereof) as of the applicable time of
determination.
“Offer to Repurchase Price” means the sum of (x) the amount of accrued and unpaid Divi- dends, if any, on the
Series A Preferred Shares subject to the applicable Offer to Repurchase (and any accrued and unpaid dividends
thereon accrued pursuant to Section (5)(c)) and (y) the greater of (1) the Conversion Amount of the Series A
Preferred Shares subject to the applicable Offer to Repurchase and (2) the amount set forth in clause (1)
increased by the same percen- tage as the premium paid to the holders of each Common Share (including
Common Shares into which Junior Shares, options or warrants of the Corporation are convertible, exchangeable
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 42 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
or exercisable) giving rise to the applicable Offer to Repurchase determined based on the pur- chase price relative
to the Closing Sale Price of the Common Shares on the Trading Day the Corporation purchases such Common
Share, Junior Share, option or warrant (unless such pur- chase occurs on a day that is not a Trading Day, in which
case the Closing Sale Price from the immediately preceding Trading will be used in the determination of such
premium). To the extent there is more than one Offer to Repurchase Event in a Calendar Quarter, the premium
referred to in the immediately preceding sentence will be based on a weighted average calcula- tion determined by
the Corporation in good faith.
“Offer to Repurchase Pro Rata Portion” means, for each Holder, a fraction the numerator of which is the number of
Series A Preferred Shares held by such Holder at the applicable time of determination and the denominator of
which is the total number of Series A Preferred Shares outstanding at the applicable time of determination. In the
event that a Holder shall sell or otherwise transfer any of its Series A Preferred Shares, the transferee shall be
allocated a pro rata portion of the transferring Holder’s Offer to Repurchase Pro Rata Portion.
“open of business” means 9:00 a.m. (New York City time).
“Person” means an individual, a limited liability company, a partnership (limited or general), a joint venture, a
corporation, a trust, an unincorporated organization, any other entity and a go- vernment or any department or
agency thereof.
“Principal Market” means the New York Stock Exchange (or its successor).
“record date” means, with respect to any dividend, distribution or other transaction or event in which the holders of
the Common Shares have the right to receive any cash, securities or other property or in which the Common
Shares are exchanged for or converted into any combina- tion of cash, securities or other property, the date fixed
for determination of holders of the Common Shares entitled to receive such cash, securities or other property
(whether such date is fixed by the Board or by statute, contract or otherwise).
“Registration Rights Agreement” means that certain registration rights agreement dated as of the Subscription Date
by and among the Corporation and the initial holders of the Series A Preferred Shares relating to, among other
things, the registration of the resale of the Common Shares issuable pursuant to the terms of these Articles of
Continuance, as may be amended, amended and restated, supplemented or otherwise modified from time to time.
“Registration Statement” shall have the meaning ascribed to such term in the Registration Rights Agreement.
“Required Holders” means the Holders representing at least a majority of the aggregate Series A Preferred Shares
then outstanding and shall include the Designee so long as the Designee and/or any of its Affiliates is a Holder
who beneficially owns, in the aggregate, at least the Mini- mum Ownership Threshold.
“Second Mandatory Conversion Period” means the period described in clause (ii) of the defi- nition of “Mandatory
Conversion Period” set forth in Section (18)(uu).
“Securities Act” means the Securities Act of 1933, as amended.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 43 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Exhibit 3.1
JUNIOR PREFERRED SHARES
“Securities Purchase Agreement” means the Securities Purchase Agreement, dated as of the Subscription Date,
by and among the Corporation and the initial holders of the Series A Prefer- red Shares, relating to, among
other things, the purchase and sale of the Series A Preferred Shares, as may be amended, amended and
restated, supplemented or otherwise modified from time to time.
“Subscription Date” means January 22, 2023.
“Subsidiaries” means any joint venture or entity in which the Corporation, directly or indirectly, owns more than
50% of the voting power of shares of capital or other equity or similar interest, including any subsidiaries
formed or acquired after the Subscription Date.
“Trading Day” means any day on which (i) the Common Shares (or other security for which a Closing Sale Price
or other price must be determined) are traded on the Principal Market, or, if the Principal Market is not the
principal U.S. trading market for the Common Shares (or such other security) on such day, then on another
Eligible Market on which the Common Shares (or such other security) are then traded or, if the Common
Shares (or such other security) are not then listed on an Eligible Market, on the principal other U.S. market on
which the Common Shares (or such other security) are then traded and (ii) a Closing Sale Price (or such other
price) is for the Common Shares (or such other security) is available on such securities exchange or
market; provided that if the Common Shares (or such other security) are not so listed or tra- ded, “Trading Day”
means a Business Day.
“Transfer Agent” means Computershare Investor Services Inc. or such other agent or agents of the Corporation
as may be designated by the Board as the transfer agent for the Common Shares.
“Weighted Average Price” means per share volume-weighted average price as displayed un- der the heading
“Bloomberg VWAP” on Bloomberg page “RBA AQR” (or its equivalent successor if such page is not
available) (or the applicable Bloomberg page with respect to the common shares or other equity interests
referred to in the definition “FMV” in Section (7)(a)(iv)) in respect of the period from the scheduled open of
trading until the scheduled close of tra- ding of the primary trading session on such Trading Day (or if such
volume-weighted average price is unavailable, the market value of one Common Share (or such other common
share or equity interest referred to in the definition “FMV” in Section (7)(a)(iv)) on such Trading Day rea-
sonably determined, using a volume-weighted average method, by a nationally recognized in- dependent
investment banking firm retained for this purpose by the Corporation). The “Weigh- ted Average Price” shall be
determined without regard to after-hours trading or any other tra- ding outside of the regular trading session
trading hours.
“Wholly-Owned Subsidiary” means, with respect to any Person, any direct or indirect Subsi- diary of such
Person, except that, solely for purposes of this definition, the reference to “more than 50%” in the definition of
“Subsidiary” shall be deemed replaced by a reference to “100%,” the calculation of which shall exclude nominal
amounts of the voting power of shares of capital stock or other interests in the relevant Subsidiary not held by
such Person to the extent requi- red to satisfy local minority interest requirements outside of the United States.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 44 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
The following is a statement of the rights, privileges, restrictions and conditions attaching to the Junior Preferred shares (the “Ju- nior Preferred Shares”),
as a class in the capital of the Corporation.
Directors’ Authority to Issue in One or More Series. The directors of the Corporation may issue the Junior Preferred Shares at any time and from time
to time in one or more series. Before any shares of a particular series are issued, the directors of the Corpo- ration shall fix the number of shares that
will form such series and shall determine, subject to the limitations set out in the ar- ticles, the designation, rights, privileges, restrictions and
conditions to be attached to the Junior Preferred Shares of such series, including, but without in any way limiting or restricting the generality of the
foregoing, the rate or rates, amount or methods of calculation of dividends thereon, the currency or currencies of payment of dividends, the time and
place of payment of divi- dends, the consideration and the terms and conditions of any purchase for cancellation, retraction or redemption rights (if
any), the conversion or exchange rights attached thereto (if any), the voting rights attached thereto (if any) and the terms and condi- tions of any share
purchase plan or sinking fund with respect thereto. Before the issue of the first shares of a series, the direc- tors shall send to the Director (as defined
in the Business Corporations Act (Ontario)) articles of amendment containing a descrip- tion of such series including the designation, rights, privileges,
restrictions and conditions determined by the directors.
Ranking of Junior Preferred Shares. No rights, privileges, restrictions or conditions attached to a series of Junior Preferred Shares shall confer upon a
series a priority in respect of dividends or return of capital over any other series of Junior Preferred Shares. The Junior Preferred Shares shall be
entitled, subject to the prior rights of the holders of the Senior Preferred Shares, to priority over the Common Shares of the Corporation and over any
other shares ranking junior to the Junior Preferred Shares with res- pect to priority in the payment of dividends and in the distribution of assets in the
event of the liquidation, dissolution or win- ding-up of the Corporation, whether voluntary or involuntary, or any other distribution of the assets of the
Corporation among its shareholders for the purpose of winding up its affairs. If any cumulative dividends or amounts payable or return of capital in
respect of a series of Junior Preferred Shares are not paid in full, the Junior Preferred Shares of all series shall participate rateably in respect of such
dividends, including accumulations, if any, in accordance with the sums that would be payable on such shares if all such dividends were declared and
paid in full and in respect of any repayment of capital in accordance with the sums that would be payable on such repayment of capital if all sums so
payable were paid in full; provided, however, that in the event of there being insufficient assets to satisfy in full all such claims as aforesaid, the claims
of the holders of the Junior Preferred Shares with respect to repayment of capital shall first be paid and satisfied and any assets remaining thereafter
shall be applied towards the payment and satisfaction of claims in respect of dividends. The Junior Preferred Shares of any series may also be gi- ven
such other preferences not consistent with clause (1) to (4) hereof over the Common Shares and over any other shares ran- king junior to the Junior
Preferred Shares as may be determined in the case of such series of Junior Preferred Shares.
Voting Rights. Except as herein referred to or as otherwise provided by law or in accordance with any voting rights which may from time to time be
attached to any series of Junior Preferred Shares, the holders of the Junior Preferred Shares as a class shall not be entitled as such to receive notice
of, to attend or to vote at any meeting of the shareholders of the Corporation.
Approval of Holders of Junior Preferred Shares. The rights, privileges, restrictions and conditions attaching to the Junior Preferred Shares as a class
may be added to, changed or removed but only with the approval of the holders of Junior Preferred Shares gi- ven as hereinafter specified.
The approval of the holders of Junior Preferred Shares to add to, change or remove any right, privilege, restriction or condition attaching to the Junior
Preferred Shares as a class or of any other matter requiring the consent of the holders of the Junior Pre- ferred Shares as a class may be given in
such manner as may then be required by law, subject to a minimum requirement that such approval be given by resolution passed by the affirmative
vote of at least 2/3 of the votes cast at a meeting of the holders of Junior Preferred Shares duly called for that purpose. The formalities to be observed
in respect of the giving of notice of any such meeting or any adjourned meeting and the conduct thereof shall be those from time to time prescribed by
the Business Corpora- tions Act (Ontario) (as from time to time amended, varied or replaced) and the by-laws of the Corporation with respect to mee-
tings of shareholders. On every poll taken at a meeting of holders of Junior Preferred Shares as a class, or at a joint meeting of the holders of two or
more series of Junior Preferred Shares, each holder of Junior Preferred Shares entitled to vote thereat shall
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Exhibit 3.1
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 45 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
have 1 vote in respect of each Junior Preferred Share held by him/her.
RB Global, Inc.
CONVERSION NOTICE
Reference is made to the Articles of Continuance of RB Global, Inc. (the “Articles of Continuance”) creating the Series A Senior Preferred Shares. In
accordance with and pursuant to the Articles of Continuance, the undersigned hereby elects to convert the number of Series A Senior Preferred
Shares (the “Series A Preferred Shares”) of RB Global, Inc., a corporation continued under the laws of the Province of Ontario (the “Corporation”),
indicated below into Common Shares (the “Common Shares”) of the Corporation, as of the date specified below.
Date of Conversion: Number of Series A Preferred Shares to be converted: Tax ID Number (If
applicable):
Please confirm the following information: Conversion Rate: Number of Common Shares to be issued:
Please issue the Common Shares into which the Series A Preferred Shares are being converted to the Holder, or for its benefit, as follows:
· □ To the undersigned’s account on the records of the Transfer Agent
Issue to: Address: Telephone Number: Tax Identification Number:
□ If the securities are unrestricted, check here if requesting delivery by Deposit/Withdrawal at Custodian as follows:
DTC Participant: DTC Number: Account Number:
Note: Initially, the common shares issued upon conversion will include restrictive legends and will not be able to be processed through DTC.
Payment Instructions for cash payment in lieu of fractional shares:
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 46 de 50
Exhibit 3.1
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Authorization:
By: Title: Dated:
Account Number (if electronic book entry transfer): Transaction Code Number (if electronic book entry
transfer):
· [NOTE TO HOLDER -- THIS FORM MUST BE SENT CONCURRENTLY TO TRANSFER AGENT]
ACKNOWLEDGMENT
The Corporation hereby acknowledges this Conversion Notice and hereby directs [Computershare Investor Services Inc.] [OR IF COMPUTERSHARE
INVESTOR SERVICES INC. NO LONGER SERVES AS THE CORPORATION’S TRANSFER AGENT, INSERT THE NAME
OF THE CORPORATION’S CURRENT TRANSFER AGENT] to issue the above indicated number of Common Shares in accordance with the
Standing Transfer Agent Instructions dated [●], 20[●] from the Corporation and acknowledged and agreed to by [Com- putershare Investor
Services Inc.] [OR IF COMPUTERSHARE INVESTOR SERVICES INC. NO LONGER SERVES AS THE CORPORA- TION’S TRANSFER AGENT, INSERT
THE NAME OF THE CORPORATION’S CURRENT TRANSFER AGENT].
RB GLOBAL, INC.
By: Name: Title:
12. Restrictions, le cas échéant, concernant l’émission, le transfert ou la propriété d’actions : S’il n’y en a aucune, inscrire
« Aucune » :
N/A
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
Exhibit 3.1
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 47 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
13. Autres dispositions
N/A
14.
La société sera maintenue en vertu de la Loi sur les sociétés par actions dans la même mesure que si elle avait été constituée en vertu de cette loi.
15. La société a observé le paragraphe 180(3) de la Loi sur les sociétés par actions.
Les statuts ont été correctement signés par les personnes autorisées.
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 48 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Document à l’appui – Document constitutif de l’autorité législative responsable
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 49 de 50
Exhibit 3.1
BCA - Statuts de maintien - RB GLOBAL, INC. - NSO:1001014884 - 24 septembre 2024
Informations à l’appui – Informations relatives au rapport NUANS
No de référence du rapport NUANS 122329043
Date du rapport NUANS 16 septembre 2024
Exhibit 3.1
Les statuts de maintien approuvés ne sont pas complets sans le certificat de
maintien. Copie certifiée conforme du dossier du ministère des Services au public et aux entreprises.
,
Directeur ou registrateur, ministère des Services au public et aux entreprises Page 50 de 50
Exhibit 3.2
BY-LAW NO. 2
A by-law relating generally to
the transaction of the business
and affairs of
RB GLOBAL, INC.
(hereinafter referred to as the “Corporation”)
DIRECTORS
1.
Calling of and notice of meetings. Meetings of the board shall be held at such place and time and on such day as they see
fit. A director may at any time convene a meeting of the board. Notice of meetings of the board shall be given to each
director not less than 48 hours before the time when the meeting is to be held. Each newly elected board may without notice
hold its first meeting for the purposes of organization and the appointment of officers immediately following the meeting of
shareholders at which such board was elected.
2.
Votes to govern. At all meetings of the board every question shall be decided by a majority of the votes cast on the
question. In case of an equality of votes the chairman of the meeting shall not be entitled to a second or casting vote.
3.
Interest of directors and officers generally in contracts. No director or officer shall be disqualified by his office from
contracting with the Corporation nor shall any contract or arrangement entered into by or on behalf of the Corporation with
any director or officer or in which any director or officer is in any way interested be liable to be voided nor shall any director
or officer so contracting or being so interested be liable to account to the Corporation for any profit realized by any such
contract or arrangement by reason of such director or officer holding that office or of the fiduciary relationship thereby
established; provided that the director or officer shall have complied with the provisions of the Business Corporations Act
(Ontario).
4.
Advance Notice for Nomination of Directors
(a) Meetings of Shareholders. Subject only to the Business Corporations Act (Ontario) and the Articles of the
Corporation, only persons who are nominated in accordance with the following procedures shall be eligible for
election as directors of the Corporation. Nominations of persons for election to the Board of Directors of the
Corporation may be made at any annual meeting of shareholders, or at any special meeting of shareholders if one
of the purposes for which the special meeting was called was the election of directors, and such nomination or
proposed nomination is made:
1
Exhibit 3.2
(i)
by or at the direction of the board, including pursuant to a notice of meeting;
(ii)
by or at the direction or request of one or more shareholders pursuant to a proposal made in accordance
with the provisions of the Business Corporations Act (Ontario), or a requisition of the shareholders made in
accordance with the provisions of the Business Corporations Act (Ontario); or
(iii)
by any person (a “Nominating Shareholder”): (a) who, at the close of business on the date of the giving of
the notice provided for below in this paragraph 4 and at the close of business on the record date for notice of
such meeting, is entered in the securities register of the Corporation as a holder of one or more shares
carrying the right to vote at such meeting or who beneficially owns shares that are entitled to be voted at
such meeting and provides evidence satisfactory to the Corporation of such beneficial ownership; and (b)
who complies with the notice procedures set forth below in this paragraph 4.
(b) Timely Notice. In addition to any other applicable requirements, for a nomination to be made by a Nominating
Shareholder, the Nominating Shareholder must have given timely notice thereof in proper written form to the
Corporate Secretary of the Corporation at the head office of the Corporation.
(i) To be timely, a Nominating Shareholder’s notice to the Corporate Secretary of the Corporation must be
made:
A.
in the case of an annual meeting of shareholders, not less than 30 days prior to the date of the
annual meeting of shareholders; provided, however, that in the event that the annual meeting of
shareholders is to be held on a date that is less than 50 days after the date (the “Notice Date”) on
which the first public announcement of the date of the annual meeting was made, notice by the
Nominating Shareholder may be made not later than the close of business on the tenth (10th) day
following the Notice Date; and
B.
in the case of a special meeting (which is not also an annual meeting) of shareholders called for the
purpose of electing directors (whether or not called for other purposes), not later than the close of
business on the fifteenth (15th) day following the day on which the first public announcement of the
date of the special meeting of shareholders was made.
(c) Proper Written Form. To be in proper written form, a Nominating Shareholder’s notice to the Corporate Secretary of
the Corporation must:
(i) set forth the following information as to each person whom the Nominating Shareholder proposes to
nominate for election as a director (each a “Proposed Nominee”):
2
Exhibit 3.2
A.
the name, age, business address and residential address of the Proposed Nominee;
B.
the principal occupation or employment of the Proposed Nominee for the most recent five years, and
the name and principal business of any corporation in which such employment was carried on;
C.
the citizenship and place of residence of the Proposed Nominee;
D.
the class or series and number of shares in the capital of the Corporation which are controlled or
which are owned beneficially or of record by the Proposed Nominee as of the record date for the
meeting of shareholders (if such date shall then have been made publicly available and shall have
occurred) and as of the date of such notice;
E.
any other information relating to the Proposed Nominee that would be required to be disclosed in a
dissident’s proxy circular in connection with solicitations of proxies for election of directors pursuant
to the Business Corporations Act (Ontario) and Applicable Securities Laws (as defined below); and
F.
the Proposed Nominee’s written consent to being named in the notice as a nominee and to serving
as a director of the Corporation if elected; and
(ii) set forth the following information as to the Nominating Shareholder giving the notice:
A.
the name and address of such Nominating Shareholder, as they appear on the securities register of
the Corporation;
B.
the number of securities of each class or series of securities of the Corporation owned of record and
beneficially by, or under the control or direction of, directly or indirectly, such Nominating
Shareholder;
C.
full particulars regarding any agreement, arrangement or understanding with respect to the
nomination between or among such Nominating Shareholder, any of their respective affiliates or
associates, and any others acting jointly or in concert with any of the foregoing, including the
Proposed Nominee;
D.
full particulars regarding any agreement, arrangement or understanding (including any derivative or
short positions, profit interests, options, warrants, convertible securities, stock appreciation or similar
rights, hedging transactions, and borrowed or loaned shares) that has been entered into as of the
date of the notice by, or on behalf of, such Nominating Shareholder, whether or not such instrument
or right shall be subject to settlement in underlying securities of the Corporation, the effect or intent of
3
Exhibit 3.2
which is to mitigate loss to, manage risk or benefit of share price changes for, or increase or
decrease the voting power of, such Nominating Shareholder with respect to securities of the
Corporation;
E.
full particulars regarding any proxy, contract, arrangement, understanding or relationship pursuant to
which such Nominating Shareholder has a right to vote or direct the voting of any securities of the
Corporation; and
F.
any other information relating to such Nominating Shareholder that would be required to be made in a
dissident’s proxy circular in connection with solicitations of proxies for election of directors pursuant
to the Business Corporations Act (Ontario) and Applicable Securities Laws (as defined below); and
(iii) include a certification by the Nominating Shareholder that the Nominating Shareholder’s notice contains no
untrue statement of 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 light of the circumstances in which it was made and a
certification by the Proposed Nominee that the information in relation to him or her contained in the
Nominating Shareholder’s Notice is true and accurate.
(d) The Corporation may require any Proposed Nominee to furnish such other information and documents as may
reasonably be required by the Corporation to (i) determine the eligibility of such Proposed Nominee to serve as an
independent director of the Corporation or that could be material to a reasonable shareholder’s understanding of
the independence and/or qualifications in respect of financial literacy, or lack thereof, of such Proposed Nominee
or (ii) satisfy the requirements of the Business Corporations Act (Ontario), Applicable Securities Laws or applicable
stock exchange rules. In addition, a Nominating Shareholder’s notice (including but not limited to the related
certification) shall be promptly updated and supplemented if necessary, so that the information provided or
required to be provided in such notice shall be true and correct as of the record date for the meeting of
shareholders.
(e) Eligibility for Nomination. No person shall be eligible for election as a director of the Corporation unless nominated in
accordance with the provisions of this paragraph 4; provided, however, that nothing in this paragraph 4 shall be
deemed to preclude discussion by a shareholder (as distinct from the nomination of directors) at a meeting of
shareholders of any matter in respect of which it would have been entitled to submit a proposal pursuant to the
provisions of the Business Corporations Act (Ontario) or the discretion of the Chairman. The Chairman of the
meeting shall have the power and duty to determine whether a nomination was made in accordance with the
procedures set forth in the foregoing provisions and, if any proposed nomination is not in compliance with such
foregoing provisions, to declare that such defective nomination shall be disregarded.
(f) For purposes of this By-law No. 2:
4
Exhibit 3.2
(i)
“public announcement” shall mean disclosure in a press release reported by a national news service in
Canada, or in a document publicly filed by the Corporation under its profile on the System of Electronic
Document Analysis and Retrieval + at www.sedarplus.ca; and
(ii)
“Applicable Securities Laws” means the applicable securities legislation of each relevant province and
territory of Canada, as amended from time to time, the rules, regulations and forms made or promulgated
under any such statute and the published national instruments, multilateral instruments, policies, bulletins
and notices of the securities commission and similar regulatory authority of each province and territory of
Canada.
(g) Notice. Notwithstanding any other provision of this By-law No. 2, a Nominating Shareholder’s notice given to the
Corporate Secretary of the Corporation pursuant to this paragraph 4 may only be given by personal delivery,
facsimile transmission or by email (at such email address as may be stipulated from time to time by the Corporate
Secretary of the Corporation for purposes of such notice), and shall be deemed to have been given and made only
at the time it is served by personal delivery, email (if applicable, at the address as aforesaid) or sent by facsimile
transmission (provided that receipt of confirmation of such transmission has been received) to the Corporate
Secretary at the address of the head office of the Corporation; provided that if such delivery or electronic
communication is made on a day which is a not a business day or later than 5:00 p.m. (Pacific Standard Time) on a
day which is a business day, then such delivery or electronic communication shall be deemed to have been made on
the subsequent day that is a business day.
(h) Compliance with Share Rights. Notwithstanding the foregoing, all nominations must be made in accordance with the
special rights and restrictions attached to any class or series of shares from time to time.
(i) Waiver of Requirement. Notwithstanding the foregoing, the Board of Directors may, in its sole discretion, waive any
requirement in this paragraph 4.
SHAREHOLDERS’ MEETINGS
5. Quorum.
(a)
Quorum. At any meeting of shareholders, a quorum shall be two persons present in person and each entitled to
vote thereat and holding or representing by proxy not less than thirty three per cent (33%) of the votes entitled to
be cast thereat.
(b)
Participation by Electronic Means. Subject to compliance with applicable requirements under the Business
Corporations Act (Ontario) and regulations thereunder and applicable securities laws, any person entitled to
attend and vote at a meeting of shareholders may (i) vote at the meeting in person or by proxy (and, subject to
any determination made from time to time by the board, may appoint a proxy by any method permitted by law
and approved by the board from time to time, including, but not limited to input of data using telephonic
facilities, over certain approved secured
5
Exhibit 3.2
internet facilities or other electronic facilities as deemed appropriate by the board); and (ii) participate in the
meeting of shareholders by means of telephonic, electronic or other communication facilities that permit all
participants to communicate adequately with each other during the meeting, in a manner as approved by the
board as orderly and secured and if the Corporation makes available such communication facilities.
(c)
Meeting by Electronic Means – Subject to compliance with applicable requirements under the Business
Corporations Act (Ontario) and regulations thereunder and applicable securities laws, the board may determine the
manner of which meetings of shareholder shall be held (either at a specific place, or by means of telephonic,
electronic or other communication facilities that permit all participants to communicate adequately with each other,
or a combination of the foregoing as the board deems appropriate). When calling a meeting of shareholders, the
board may determine that such meeting will be held entirely by means of such telephonic, electronic or other
communication facilities, provided that the board is reasonably satisfied that all participants shall be able to
communicate adequately with each other during the meeting.
(d)
Procedures in relation to Electronic Participation. Subject to compliance with applicable requirements under the
Business Corporations Act (Ontario) and regulations thereunder and applicable securities laws, the board may
establish, in connection with any meeting of shareholders, procedures regarding voting at the meeting by means
of telephonic, electronic or other communication facilities consistent with those procedures. The board may
determine from time to time that the voting at any specific meeting shall be held entirely by such means.
INDEMNIFICATION
6.
Indemnification of directors and officers. The Corporation shall indemnify a director or officer of the Corporation, a former
director or officer of the Corporation or a person who acts or acted at the Corporation's request as a director or officer of a
body corporate of which the Corporation is or was a shareholder or creditor, and his heirs and legal representatives to the
extent permitted by the Business Corporations Act (Ontario).
7.
Indemnity of others. Except as otherwise required by the Business Corporations Act (Ontario) and subject to paragraph 6,
the Corporation may from time to time indemnify and save harmless any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the Corporation) by reason of the fact that he is or was an
employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer,
employee, agent of or participant in another body corporate, partnership, joint venture, trust or other enterprise, against
expenses (including legal fees), judgments, fines and any amount actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted honestly and in good faith with a view to the best interests of the
Corporation and, with respect to any criminal or administrative action or proceeding that is enforced by a monetary penalty,
had reasonable grounds for believing that his conduct was lawful. The termination of any action, suit or proceeding by
judgment, order, settlement or conviction shall not, of itself, create a presumption
6
Exhibit 3.2
that the person did not act honestly and in good faith with a view to the best interests of the Corporation and, with respect
to any criminal or administrative action or proceeding that is enforced by a monetary penalty, had no reasonable grounds
for believing that his conduct was lawful.
8.
Right of indemnity not exclusive. The provisions for indemnification contained in the by-laws of the Corporation shall not be
deemed exclusive of any other rights to which any person seeking indemnification may be entitled under any agreement,
vote of shareholders or directors or otherwise, both as to action in his official capacity and as to action in another capacity,
and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit
of the heirs and legal representatives of such a person.
9.
No liability of directors or officers for certain matters. To the extent permitted by law, no director or officer for the time being
of the Corporation shall be liable for the acts, receipts, neglects or defaults of any other director or officer or employee or for
joining in any receipt or act for conformity or for any loss, damage or expense happening to the Corporation through the
insufficiency or deficiency of title to any property acquired by the Corporation or for or on behalf of the Corporation or for the
insufficiency or deficiency of any security in or upon which any of the moneys of or belonging to the Corporation shall be
placed out or invested or for any loss or damage arising from the bankruptcy, insolvency or tortious act of any person, firm
or body corporate with whom or which any moneys, securities or other assets belonging to the Corporation shall be lodged
or deposited or for any loss, conversion, misapplication or misappropriation of or any damage resulting from any dealings
with any moneys, securities or other assets belonging to the Corporation or for any other loss, damage or misfortune
whatever which may happen in the execution of the duties of his respective office or trust or in relation thereto unless the
same shall happen by or through his failure to act honestly and in good faith with a view to the best interests of the
Corporation and in connection therewith to exercise the care, diligence and skill that a reasonably prudent person would
exercise in comparable circumstances. If any director or officer of the Corporation shall be employed by or shall perform
services for the Corporation otherwise than as a director or officer or shall be a member of a firm or a shareholder, director
or officer of a body corporate which is employed by or performs services for the Corporation, the fact of his being a director
or officer of the Corporation shall not disentitle such director or officer or such firm or body corporate, as the case may be,
from receiving proper remuneration for such services.
BANKING ARRANGEMENTS, CONTRACTS, ETC.
10.
Banking arrangements. The banking business of the Corporation, or any part thereof, shall be transacted with such banks,
trust companies or other financial institutions as the board may designate, appoint or authorize from time to time by
resolution and all such banking business, or any part thereof, shall be transacted on the Corporation's behalf by such one
or more officers and/or other persons as the board may designate, direct or authorize from time to time by resolution and to
the extent therein provided.
11.
Execution of instruments. Contracts, documents or instruments in writing requiring execution by the Corporation shall be
signed by any one officer or director, and all contracts, documents or instruments in writing so signed shall be binding upon
the Corporation without any further authorization or formality. The board is authorized from time to time by resolution to
appoint any director or directors, officer or officers or any
7
Exhibit 3.2
other person or persons on behalf of the Corporation to sign and deliver either contracts, documents or instruments in
writing generally or to sign either manually or by facsimile signature and deliver specific contracts, documents or
instruments in writing. The term “contracts, documents or instruments in writing” as used in this By-law No. 2 shall include
deeds, mortgages, charges, conveyances, powers of attorney, transfers and assignments of property of all kinds including
specifically but without limitation transfers and assignments of shares, warrants, bonds, debentures or other securities and
all paper writings.
MISCELLANEOUS
12.
Invalidity of any provisions of this By-law No. 2. The invalidity or unenforceability of any provision of this by-law shall not
affect the validity or enforceability of the remaining provisions of this By-law No.2.
13.
Omissions and errors. The accidental omission to give any notice to any shareholder, director, officer or auditor or the non-
receipt of any notice by any shareholder, director, officer or auditor or any error in any notice not affecting the substance
thereof shall not invalidate any action taken at any meeting held pursuant to such notice or otherwise founded thereon.
INTERPRETATION
14.
Interpretation. In this By-law No. 2 and all other by-laws of the Corporation words importing the singular number only shall
include the plural and vice versa; words importing the masculine gender shall include the feminine and neuter genders;
words importing persons shall include an individual, partnership, association, body corporate, executor, administrator or
legal representative and any number or aggregate of persons; “articles” include the original or restated articles of
incorporation, articles of amendment, articles of amalgamation, articles of continuance, articles of reorganization, articles of
arrangement and articles of revival; “board” shall mean the board of directors of the Corporation; “Business Corporations
Act (Ontario)” shall mean Business Corporations Act, R.S.O. 1990, c. B. 16 as amended from time to time or any Act that
may hereafter be substituted therefor; and “meeting of shareholders” shall mean and include an annual meeting of
shareholders and a special meeting of shareholders.
REPEAL
15.
Repeal. All previous by-laws of the Corporation are repealed as of the coming into force of this by-law provided that such
repeal will not affect the previous operation of any by-law so repealed or affect the validity of any act done or right,
privilege, obligation or liability acquired or incurred under or the validity of any contract or agreement made pursuant to any
such by-law prior to its repeal. All officers and persons acting under any by-law so repealed will continue to act as if
appointed by the directors under the provisions of this by-law or the Business Corporations Act (Ontario) until their
successors are appointed.
8
Exhibit 4.1
SECOND AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN AGREEMENT
DATED AS OF FEBRUARY 24, 2025 (AMENDING AND RESTATING THE AMENDED AND RESTATED SHAREHOLDER RIGHTS
PLAN AGREEMENT DATED AS OF FEBRUARY 28, 2019)
BETWEEN
RB GLOBAL, INC.
AND
COMPUTERSHARE INVESTOR SERVICES INC.
AS RIGHTS AGENT
Exhibit 4.1
TABLE OF CONTENTS
1.1 Certain Definitions 2
1.2 Currency 16
1.3 Headings and Interpretation 16
1.4 Calculation of Number and Percentage of Beneficial Ownership of Outstanding Voting Shares 16
1.5 Acting Jointly or in Concert 17
1.6 Generally Accepted Accounting Principles 17
ARTICLE 2 - THE RIGHTS 17
2.1 Issue of Rights: Legend on Common Share Certificates 17
2.2 Initial Exercise Price; Exercise of Rights; Detachment of Rights 18
2.3 Adjustments to Exercise Price; Number of Rights 21
2.4 Date on Which Exercise Is Effective 26
2.5 Execution, Authentication, Delivery and Dating of Rights Certificates 27
2.6 Registration, Transfer and Exchange 27
2.7 Mutilated, Destroyed, Lost and Stolen Rights Certificates 28
2.8 Persons Deemed Owners of Rights 29
2.9 Delivery and Cancellation of Certificates 29
2.10 Agreement of Rights Holders 29
2.11 Holder of Rights Not Deemed a Shareholder 30
ARTICLE 3 - ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF A FLIP-IN EVENT 31
3.1 Flip-in Event 31
ARTICLE 4 - THE RIGHTS AGENT 32
4.1 General 32
4.2 Merger, Amalgamation or Consolidation or Change of Name of Rights Agent 33
4.3 Duties of Rights Agent 34
4.4 Change of Rights Agent 36
4.5 Compliance with Money Laundering Legislation 36
4.6 Privacy Provision 37
4.7 Fiduciary Duties of the Board of Directors 37
4.8 Liability 37
ARTICLE 5 - MISCELLANEOUS 37
5.1 Redemption and Waiver 37
5.2 Expiration 39
5.3 Issuance of New Rights Certificates 39
5.4 Supplements and Amendments 40
5.5 Fractional Rights and Fractional Shares 41
5.6 Rights of Action 42
5.7 Regulatory Approvals 42
5.8 Non-Canadian Holders 42
5.9 Notices 43
5.10 Costs of Enforcement 44
5.11 Successors 44
5.12 Benefits of this Agreement 44
5.13 Governing Law 44
5.14 Severability 44
i
Exhibit 4.1
5.15 Effective Date and Confirmation 44
5.16 Reconfirmation 45
5.17 Determinations and Actions by the Board of Directors 45
5.18 Force Majeure 45
5.19 Time of the Essence 45
5.20 Execution in Counterparts 45
ATTACHMENT 1 47
FORM OF ASSIGNMENT 50
FORM OF ELECTION TO EXERCISE 51
CERTIFICATE 52
NOTICE 52
ii
Exhibit 4.1
SECOND AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN AGREEMENT
SECOND AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN AGREEMENT, dated as of February 24,
2025, between RB Global, Inc., a corporation incorporated under the Business Corporations Act (Ontario) (the ‘Company’) and
Computershare Investor Services Inc., a trust company existing under the laws of Canada (the ‘Rights Agent’), which amends and
restates the Amended and Restated Shareholder Rights Plan Agreement dated as of February 28, 2019 (the ‘Original
Agreement’).
WHEREAS:
A. The Board of Directors (as hereinafter defined) has determined that it is in the best interests of the Company to continue to
have a shareholder rights plan (the ‘Rights Plan’) to ensure, to the extent possible, that all shareholders of the Company
are treated fairly in connection with any take-over bid for the securities of the Company;
B. The Company and the Rights Agent wish to effect certain amendments to update and restate the Original Agreement, on terms
and conditions and in the form of this Agreement, to be approved, ratified and confirmed by the shareholders of the
Company at the annual meeting of shareholders of the Company to be held May 5, 2025, or any adjournment or
postponement thereof;
C. In order to implement the Rights Plan as established by the Original Agreement, the Board of Directors has previously
authorized:
a.
the issuance, effective at the close of business on the Record Time (as hereinafter defined), of one Right (as
hereinafter defined) in respect of each Common Share (as hereinafter defined) outstanding at the close of business
on the Record Time; and
b.
the issuance of one Right in respect of each Common Share issued after the Record Time and prior to the earlier of
the Separation Time (as hereinafter defined) and the Expiration Time (as hereinafter defined);
E. Each Right entitles the holder thereof, after the Separation Time, to purchase securities of the Company pursuant to the terms
and subject to the conditions set forth herein;
F. The Company desires to confirm the appointment of the Rights Agent to act on behalf of the Company and the holders of
Rights, and the Rights Agent is willing to so act, in connection with the issuance, transfer, exchange and replacement of
Rights Certificates (as hereinafter defined), the exercise of Rights and other matters referred to herein;
1
Exhibit 4.1
NOW THEREFORE, in consideration of the premises and the respective covenants and agreements set forth herein,
and subject to such covenants and agreements, the parties hereby agree as follows:
Article 1
- INTERPRETATION
1.1
Certain Definitions
For purposes of this Agreement, the following terms have the meanings indicated:
(a)
‘Acquiring Person’ means any Person who is the Beneficial Owner of 20% or more of the outstanding Voting
Shares; provided, however, that the term ‘Acquiring Person’ shall not include:
(i)
the Company or any Subsidiary of the Company;
(ii)
any Person who becomes the Beneficial Owner of 20% or more of the outstanding Voting Shares as a result
of one or any combination of:
(A)
a Voting Share Reduction;
(B)
a Permitted Bid Acquisition;
(C)
an Exempt Acquisition;
(D)
a Pro Rata Acquisition; or
(E)
a Convertible Security Acquisition;
provided, however, that if a Person becomes the Beneficial Owner of 20% or more of the outstanding Voting Shares
by reason of one or any combination of a Voting Share Reduction, a Permitted Bid Acquisition, an Exempt
Acquisition, a Pro Rata Acquisition or a Convertible Security Acquisition and such Person’s Beneficial Ownership of
Voting Shares thereafter increases by more than 1% of the number of Voting Shares outstanding (other than
pursuant to one or any combination of a Voting Share Reduction, a Permitted Bid Acquisition, an Exempt Acquisition,
a Pro Rata Acquisition or a Convertible Security Acquisition), then as of the date of such increase, such Person shall
become an ‘Acquiring Person’;
(iii)
for a period of ten days after the Disqualification Date (as defined below), any Person who becomes the
Beneficial Owner of 20% or more of the outstanding Voting Shares as a result of such Person becoming
disqualified from relying on Subsection 1.1(f)(v) solely because such Person or the Beneficial Owner of such
Voting Shares is making or has announced an intention to make a Take-over Bid, either alone or by acting
jointly or in concert with any other Person; (For the purposes of this definition, ‘Disqualification Date’ means
the first date of public
2
Exhibit 4.1
announcement that such Person is making or has announced an intention to make a Take-over Bid alone or
jointly or in concert with any other Person);
(iv)
an underwriter or member of a banking or selling group that becomes the Beneficial Owner of 20% or more of
the Voting Shares in connection with a distribution of securities of the Company pursuant to a prospectus or
by way of private placement; or
(v)
a Person (a ‘Grandfathered Person’) who is the Beneficial Owner of 20% or more of the outstanding Voting
Shares of the Company determined as at the Record Time, provided, however, that this exception shall not
be, and shall cease to be, applicable to a Grandfathered Person in the event that such Grandfathered Person
shall, after the Record Time, become the Beneficial Owner of additional Voting Shares of the Company that
increases its Beneficial Ownership of Voting Shares by more than 1% of the number of Voting Shares
outstanding as at the Record Time (other than pursuant to one or any combination of a Voting Share
Reduction, a Permitted Bid Acquisition, an Exempt Acquisition or a Pro Rata Acquisition); and provided,
further, that a Person shall cease to be a Grandfathered Person in the event that such Person ceases to
Beneficially Own 20% or more of the then outstanding Voting Shares at any time after the Record Time;
(b)
‘Affiliate’, when used to indicate a relationship with a Person means a Person that directly, or indirectly through one
or more intermediaries, controls, or is controlled by, or is under common control with, such specified Person;
(c)
‘Agreement’ means this second amended and restated shareholder rights plan agreement dated February 24,
2025, between the Company and the Rights Agent, which amends and restates the Original Agreement, and as the
same may be further amended or supplemented or restated from time to time; ‘hereof’, ‘herein’, ‘hereto’ and similar
expressions mean and refer to this Agreement as a whole and not to any particular part of this Agreement;
(d)
‘annual cash dividend’ means cash dividends paid in any fiscal year of the Company to the extent that such cash
dividends do not exceed, in the aggregate, the greatest of:
(i)
200 per cent of the aggregate amount of cash dividends declared payable by the Company on its Common
Shares in its immediately preceding fiscal year;
(ii)
300 per cent of the arithmetic mean of the aggregate amounts of the annual cash dividends declared payable
by the Company on its Common Shares in its three immediately preceding fiscal years; and
(iii)
100 per cent of the aggregate consolidated net income of the Company, before extraordinary items, for its
immediately preceding fiscal year;
3
Exhibit 4.1
(e)
‘Associate’, when used to indicate a relationship with a specified Person, means (i) a spouse of such specified
Person, (ii) any Person of either sex with whom such specified Person is living in a conjugal relationship outside
marriage or (iii) any relative of such specified Person or of a Person mentioned in clauses (i) or (ii) or this definition if
that relative has the same residence as the specified Person;
(f)
A Person shall be deemed the ‘Beneficial Owner’ of, and to have ‘Beneficial Ownership’ of, and to ‘Beneficially
Own’,
(i)
any securities as to which such Person or any of such Person’s Affiliates or Associates is the owner at law or
in equity;
(ii)
any securities as to which such Person or any of such Person’s Affiliates or Associates has the right to
become the owner at law or in equity (where such right is exercisable within a period of 60 days whether or
not on condition or the happening of any contingency or the making of any payment or payment of
instalments), upon the conversion, exchange or exercise of any right attaching to Convertible Securities or
pursuant to any agreement, arrangement, pledge or understanding, whether or not in writing (other than (x)
customary agreements with and between underwriters and banking group members and selling group
members (or any of the foregoing) with respect to a public offering or private placement of securities and
(y) pledges of securities in the ordinary course of business); or
(iii)
any securities which are Beneficially Owned within the meaning of Subsections (i) or (ii) of this definition by
any other Person with whom such Person or such Person’s Affiliates is acting jointly or in concert;
provided, however, that a Person shall be deemed not to be the ‘Beneficial Owner’ of, or to have ‘Beneficial
Ownership’ of, or to ‘Beneficially Own’, any security:
(iv)
where such security has been agreed to be deposited or tendered pursuant to a Permitted Lock-up
Agreement or is otherwise deposited to any Take-over Bid made by such Person, made by any of such
Person’s Affiliates or Associates or made by any other Person acting jointly or in concert with such Person
until such deposited or tendered security has been taken up or paid for, whichever shall first occur;
(v)
where such Person, any of such Person’s Affiliates or Associates or any other Person acting jointly or in
concert with such Person holds such security provided that:
(A)
the ordinary business of any such Person (the ‘Investment Manager’) includes the management of
investment funds for others (which others, for greater certainty, may include or be limited to one or
more employee benefit plans or pension plans) and such security is held by the Investment Manager
in the
4
Exhibit 4.1
ordinary course of such business in the performance of such Investment Manager’s duties for the
account of any other Person (a ‘Client’) including a non-discretionary account held on behalf of a
Client by a broker or dealer registered under applicable laws;
(B)
such Person (the ‘Trust Company’) is licensed to carry on the business of a trust company under
applicable laws and, as such, acts as trustee or administrator or in a similar capacity in relation to the
estates of deceased or incompetent Persons (each an ‘Estate Account’) or in relation to other
accounts (each an ‘Other Account’) and holds such security in the ordinary course of such duties for
such Estate Account or for such Other Accounts;
(C)
such Person is established by statute for purposes that include, and the ordinary business or activity
of such Person (the ‘Statutory Body’) includes, the management of investment funds for employee
benefit plans, pension plans, insurance plans or various public bodies and the Statutory Body holds
such security for the purposes of its activities as such;
(D)
such Person (the ‘Administrator’) is the administrator or trustee of one or more pension funds or
plans (a ‘Plan’), or is a Plan, registered or qualified under the laws of Canada or any province or
territory thereof or the laws of the United States of America or any State thereof and holds such
security for the purposes of its activity as such; or
(E)
such Person (the ‘Crown Agent’) is a Crown agent or agency;
provided, in any of the above cases, that the Investment Manager, the Trust Company, the Statutory Body,
the Administrator, the Plan or the Crown Agent, as the case may be, is not then making a Take-over Bid or
has not then announced an intention to make a Take-over Bid alone or acting jointly or in concert with any
other Person, other than an Offer to Acquire Voting Shares or other securities (x) pursuant to a distribution by
the Company, or (y) by means of ordinary market transactions (including prearranged trades entered into in
the ordinary course of business of such Person) executed through the facilities of a stock exchange or
organized over-the-counter market;
(vi)
where such Person or any of such Person’s Affiliates or Associates or any other Person acting jointly or in
concert with such Person is (A) a Client of the same Investment Manager as another Person on whose
account the Investment Manager holds such security, (B) an Estate Account or an Other Account of the same
Trust Company as another Person on whose account the Trust Company holds such security or (C) a Plan
with the same Administrator as another Plan on whose account the Administrator holds such security;
5
Exhibit 4.1
(vii)
where such Person is (A) a Client of an Investment Manager and such security is owned at law or in equity
by the Investment Manager, (B) an Estate Account or an Other Account of a Trust Company and such
security is owned at law or in equity by the Trust Company or (C) a Plan and such security is owned at law or
in equity by the Administrator of the Plan; or
(viii)
where such Person is a registered holder of such security as a result of carrying on the business of, or acting
as a nominee of, a securities depositary;
(g)
‘Board of Directors’ means the board of directors of the Company or any duly constituted and empowered
committee thereof;
(h)
‘Business Corporations Act (Ontario)’ means the Business Corporations Act, R.S.O. 1990, c. B.16, as amended,
and the regulations thereunder, unless otherwise specified, as the same exist on the date hereof;
(i)
‘Business Day’ means any day other than a Saturday, Sunday or a day on which banking institutions in Vancouver,
British Columbia are authorized or obligated by law to close;
(j)
‘Canadian - U.S. Exchange Rate’ means, on any date, the inverse of the U.S. - Canadian Exchange Rate in effect
on such date;
(k)
‘close of business’ on any given date means the time on such date (or, if such date is not a Business Day, the time
on the next succeeding Business Day) at which the principal transfer office in Vancouver, British Columbia of the
transfer agent for the Common Shares (or, after the Separation Time, the principal transfer office in Vancouver,
British Columbia of the Rights Agent) is closed to the public;
(l)
‘Common Shares’ means the common shares in the capital of the Company;
(m)
‘Competing Permitted Bid’ means a Take-over Bid that:
(i)
is made after a Permitted Bid or another Competing Permitted Bid has been made and prior to the expiry of
such Permitted Bid or Competing Permitted Bid;
(ii)
satisfies all components of the definition of a Permitted Bid other than the requirements set out in Subsection
(iii) of the definition of Permitted Bid; and
(iii)
contains, and the take-up and payment for securities tendered or deposited are subject to, irrevocable and
unqualified conditions that no Voting Shares will be taken up or paid for pursuant to the Competing Take-over
Bid prior to the close of business on a date that is no earlier than the minimum number of days such Take-
over Bid must remain open for deposits of securities thereunder pursuant to applicable Canadian
6
Exhibit 4.1
securities laws after the date of the Take-over Bid constituting such Competing Permitted Bid;
(iv)
provided always, for greater certainty, that a Competing Permitted Bid will cease to be a Competing
Permitted Bid at any time when such bid ceases to meet any of the provisions of this definition and provided
that, at such time, any acquisition of Voting Shares made pursuant to such Competing Permitted Bid,
including any acquisitions of Voting Shares theretofore made, will cease to be a Permitted Bid Acquisition;
(n)
‘controlled’: a Person is ‘controlled’ by another Person or two or more other Persons acting jointly or in concert if:
(i)
in the case of a body corporate, securities entitled to vote in the election of directors of such body corporate
carrying more than 50% of the votes for the election of directors are held, directly or indirectly, by or for the
benefit of the other Person or Persons and the votes carried by such securities are entitled, if exercised, to
elect a majority of the board of directors of such body corporate; or
(ii)
in the case of a Person which is not a body corporate, more than 50% of the voting or equity interests of such
entity are held, directly or indirectly, by or for the benefit of the other Person or Persons;
and ‘controls’, ‘controlling’ and ‘under common control with’ shall be interpreted accordingly;
(o)
‘Convertible Securities’ shall mean, at any time:
(i)
any right (contractual or otherwise, regardless of whether it would be considered a security); or
(ii)
any securities issued by the Company (including rights, warrants and options but not including the Rights)
carrying any purchase, exercise, conversion or exchange right,
(iii)
pursuant to which the holder thereof may acquire Voting Shares or other securities convertible into or
exercisable or exchangeable for Voting Shares (in each case, whether such right is exercisable immediately or after
a specified period and whether or not on condition or the happening of any contingency);
(p)
‘Convertible Security Acquisition’ means the acquisition of Voting Shares from the Company upon the exercise or
pursuant to the terms and conditions of any Convertible Securities acquired by a Person pursuant to a Permitted Bid
Acquisition, an Exempt Acquisition or a Pro Rata Acquisition;
(q)
‘Co-Rights Agents’ has the meaning ascribed thereto in Subsection 4.1(a);
7
Exhibit 4.1
(r)
‘Disposition Date’ has the meaning ascribed thereto in Subsection 5.1(h);
(s)
‘Dividend Reinvestment Acquisition’ means an acquisition of Voting Shares pursuant to a Dividend Reinvestment
Plan;
(t)
‘Dividend Reinvestment Plan’ means a regular dividend reinvestment or other plan of the Company made
available by the Company to holders of its securities or holders of securities of a Subsidiary where such plan permits
the holder to direct that some or all of:
(i)
dividends paid in respect of shares of any class of the Company or a Subsidiary;
(ii)
proceeds of redemption of shares of the Company or a Subsidiary;
(iii)
interest paid on evidences of indebtedness of the Company or a Subsidiary; or
(iv)
optional cash payments;
be applied to the purchase from the Company of Voting Shares;
(u)
‘Election to Exercise’ has the meaning ascribed thereto in Subsection 2.2(d)(ii);
(v)
‘Exempt Acquisition’ means an acquisition of Voting Shares or Convertible Securities (i) in respect of which the
Board of Directors has waived the application of Section 3.1 pursuant to the provisions of Subsection 5.1(a) or (h); or
(ii) pursuant to an amalgamation, merger or other statutory procedure, or private placement or other issuance of
Voting Shares or Convertible Securities requiring approval of the shareholders of the Company;
(w)
‘Exercise Price’ means, as of any date, the price at which a holder may purchase the securities issuable upon
exercise of one whole Right which, until adjustment thereof in accordance with the terms hereof, shall be an amount
equal to three times the Market Price per Common Share determined as at the Separation Time;
(x)
‘Expansion Factor’ has the meaning ascribed thereto in Subsection 2.3(a)(x);
(y)
‘Expiration Time’ means (i) the earlier of the Termination Time, and (ii) the termination of any meeting of holders of
Voting Shares at which this Agreement was not confirmed or reconfirmed as provided for in Sections 5.15 and 5.16;
(z)
‘Flip-in Event’ means a transaction or other event in or pursuant to which any Person becomes an Acquiring
Person;
(aa)
‘holder’ has the meaning ascribed thereto in Section 2.8;
(ab)
‘Independent Shareholders’ means holders of Voting Shares, other than:
8
Exhibit 4.1
(i)
any Acquiring Person;
(ii)
any Offeror (other than any Person who, by virtue of Subsection 1.1(f)(v), is not deemed to Beneficially Own
the Voting Shares held by such Person);
(iii)
any Affiliate or Associate of any Acquiring Person or Offeror;
(iv)
any Person acting jointly or in concert with any Acquiring Person or Offeror; and
(v)
any employee benefit plan, deferred profit sharing plan, stock participation plan and any other similar plan or
trust for the benefit of employees of the Company or a Subsidiary unless the beneficiaries of the plan or trust
direct the manner in which the Voting Shares are to be voted or withheld from voting or direct whether the
Voting Shares are to be tendered to a Take-over Bid;
(ac)
‘Market Price’ per security of any securities on any date of determination means the average of the daily closing
prices per security of the securities (determined as described below) on each of the 20 consecutive Trading Days
through and including the Trading Day immediately preceding such date; provided, however, that if an event of a
type analogous to any of the events described in Section 2.3 hereof shall have caused the closing prices used to
determine the Market Price on any Trading Days not to be fully comparable with the closing price on the date of
determination (or, if the date of determination is not a Trading Day, on the immediately preceding Trading Day), each
closing price so used shall be appropriately adjusted in a manner analogous to the applicable adjustment provided
for in Section 2.3 hereof in order to make it fully comparable with the closing price on the date of determination (or, if
the date of determination is not a Trading Day, on the immediately preceding Trading Day). The closing price per
security of any securities on any date shall be:
(i)
the last sale price, regular way, or, in case no such sale takes place on such date, the average of the closing
bid and asked prices, regular way, for each of the securities as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to trading on the New York Stock
Exchange;
(ii)
if for any reason none of such prices is available on such day or the securities are not listed or admitted for
trading on the exchange referred to in (i), the closing board lot sale price or, in case no such sale takes place
on such date, the average of the closing bid and asked prices for each of the securities as reported by the
principal stock exchange in the United States of America (as determined by volume of trading) on which such
securities are listed or admitted to trading or, if for any reason none of such prices is available on such day or
the securities are not listed or admitted for trading on any United States stock exchange, on such other
Canadian stock exchange, or if the securities are not listed or admitted for trading on any Canadian stock
exchange, such other stock exchange on which the securities are listed or admitted for trading;
9
Exhibit 4.1
(iii)
if for any reason none of such prices is available on such day or the securities are not listed or admitted to
trading on a national United States stock exchange, a Canadian stock exchange or any other stock
exchange, the last sale price or, in case no sale takes place on such date, the average of the high bid and
low asked prices for each of the securities in the over-the-counter market, as quoted by any recognized
reporting system then in use (as determined by the Board of Directors); or
(iv)
if for any reason none of such prices is available on such day or the securities are not listed or admitted to
trading on a Canadian stock exchange, a national United States stock exchange or any other stock exchange
or quoted by any reporting system, the average of the closing bid and asked prices as furnished by a
recognized professional market maker making a market in the securities selected in good faith by the Board
of Directors;
provided, however, that if for any reason none of such prices is available on such day, the closing price per security
of the securities on such date means the fair value per share of the securities on such date as determined by an
internationally recognized investment dealer or investment banker selected by the Board of Directors. The Market
Price shall be expressed in U.S. dollars. If any relevant amount used in calculating the Market Price happens to be in
Canadian dollars, such amount shall be translated into United States dollars on that date at the U.S. Dollar
Equivalent thereof;
(ad)
‘1933 Securities Act’ means the Securities Act of 1933 of the United States, as amended, and the rules and
regulations thereunder, as now in effect or as the same may from time to time be amended, re-enacted or replaced;
(ae)
‘1934 Exchange Act’ means the Securities Exchange Act of 1934 of the United States, as amended, and the rules
and regulations thereunder as now in effect or as the same may from time to time be amended, re-enacted or
replaced;
(af)
“NI 62-104” means the National Instrument 62-104 – Take-Over Bids and Issuer Bids and any comparable or
successor laws, instruments or rules thereto;
(ag)
‘Nominee’ has the meaning ascribed thereto in Subsection 2.2(c);
(ah)
‘Offer to Acquire’ includes:
(i)
an offer to purchase or a solicitation of an offer to sell Voting Shares; and
(ii)
an acceptance of an offer to sell Voting Shares, whether or not such offer to sell has been solicited;
or any combination thereof, and the Person accepting an offer to sell shall be deemed to be making an Offer to
Acquire to the Person that made the offer to sell;
10
Exhibit 4.1
(ai)
‘Offeror’ means a Person who has announced, and has not withdrawn, an intention to make or who has made, and
has not withdrawn, a Take-over Bid, other than a Person who has completed a Permitted Bid, a Competing
Permitted Bid or an Exempt Acquisition;
(aj)
‘Offeror’s Securities’ means Voting Shares Beneficially Owned by an Offeror on the date of the Offer to Acquire;
(ak)
‘Permitted Bid’ means a Take-over Bid made by a Person by way of take-over bid circular which also complies with
the following additional provisions:
(i)
the Take-over Bid is made to all holders of Voting Shares as registered on the books of the Company, other
than the Person making the Take-over Bid (the ‘Permitted Bid Offeror’);
(ii)
no Voting Shares are taken up or paid for pursuant to the Take-over Bid unless more than 50% of the Voting
Shares held by Independent Shareholders shall have been deposited or tendered pursuant to the Take-over
Bid and not withdrawn;
(iii)
the Take-over Bid contains, and the take-up and payment for securities tendered or deposited is subject to,
irrevocable and unqualified provisions that no Voting Shares will be taken up or paid for pursuant to the Take-
over Bid prior to the close of business on the date which is not less than 105 days following the date of the
Take-over Bid or such shorter period that a Take-over Bid that is not exempt from the general Take-over Bid
requirements of applicable Canadian securities laws must remain open for deposits of securities thereunder,
in the applicable circumstances at such time;
(iv)
the Take-over Bid contains an irrevocable and unqualified provision that, unless the Take-over Bid is
withdrawn, Voting Shares may be deposited pursuant to such Take-over Bid at any time during the period of
time between the date of the Take-over Bid and the date on which Voting Shares may be taken up and paid
for and that any Voting Shares deposited pursuant to the Take-over Bid may be withdrawn until taken up and
paid for; and
(v)
the Take-over Bid contains an irrevocable and unqualified provision that, unless the Take-over Bid is
withdrawn, in the event that the deposit condition set forth in Subsection(ii) is satisfied, the Permitted Bid
Offeror will make a public announcement of that fact and the Take-over Bid will remain open for deposits and
tenders of Voting Shares for not less than ten Business Days from the date of such public announcement;
(al)
provided always that a Permitted Bid will cease to be a Permitted Bid at any time when such bid ceases to
meet any of the provisions of this definition and provided that, at such time, any acquisition of Voting Shares made
pursuant to such Permitted bid, including any acquisitions of Voting Shares theretofore made, will cease to be a
Permitted Bid Acquisition;
11
Exhibit 4.1
(am)
‘Permitted Bid Acquisition’ means an acquisition of Voting Shares made pursuant to a Permitted Bid or a
Competing Permitted Bid;
(an)
‘Permitted Lock-up Agreement’ means an agreement between an Offeror, any of its Affiliates or Associates or any
other Person acting jointly or in concert with the Offeror and a Person (the ‘Locked-up Person’) who is not an
Affiliate or Associate of the Offeror or a Person acting jointly or in concert with the Offeror (the terms of which
agreement are publicly disclosed and a copy of which is made available to the public (including the Company) not
later than the date the Lock-up Bid (as defined below) is publicly announced or if the Lock-up Bid has been made
prior to the date on which such agreement is entered into, forthwith, and in any event not later than the date
following the date of such agreement) whereby the Locked-up Person agrees to deposit or tender the Voting Shares
held by the Locked-up Person to the Offeror’s Take-over Bid or to any Take-over Bid made by any of the Offeror’s
Affiliates or Associates or made by any other Person acting jointly or in concert with the Offeror (the ‘Lock-up Bid’)
provided such agreement:
(i)
permits the Locked-up Person to withdraw the Voting Shares from the agreement in order to tender or
deposit the Voting Shares to another Take-over Bid or to support another transaction (whether by way of
merger, amalgamation, arrangement, reorganization or other transaction) (the ‘Superior Offer
Consideration’) that in either case will provide a greater cash equivalent value per Voting Share to the
holders of Voting Shares than the Locked-up Person otherwise would have received to pay under the Lock-
up Bid (the ‘Lock-up Bid Consideration’). Notwithstanding the above, the Permitted Lock-up Agreement
may require that the Superior Offer Consideration must exceed the Lock-up Bid Consideration by a specified
percentage before such withdrawal right takes effect, provided such specified percentage is not greater than
7%;
(ao)
(and, for greater clarity, such agreement may contain a right of first refusal or require a period of delay to give
an Offeror an opportunity to match a higher price in another Take-over Bid or transaction and may provide for any
other similar limitation on a Locked-up Person’s right to withdraw Voting Shares from the agreement, as long as the
limitation does not preclude the exercise by the Locked-up Person of the right to withdraw Voting Shares during the
period of the other Take-over Bid or other transaction); and
(i)
does not provide for any “break-up” fees, “top-up” fees, penalties, expenses or other amounts that exceed in
the aggregate the greater of:
(A)
the cash equivalent of 2.5% of the price or value payable under the Lock-up Bid to a Locked-Up
Person; and
(B)
50% of the amount by which the price or value payable under another Take-over Bid or transaction
exceeds the price or value of the consideration that such Locked-up Person would have received
under the Lock-up Bid;
12
Exhibit 4.1
(ap)
being payable or forfeited by a Locked-up Person pursuant to the agreement in the event a Locked-up
Person fails to deposit or tender Voting Shares to the Lock-up Bid, withdraws Voting Shares previously tendered
thereto to another Take-over Bid or supports another transaction;
(aq)
‘Person’ includes any individual, firm, partnership, association, trust, trustee, executor, administrator, legal personal
representative, body corporate, joint venture, corporation, unincorporated organization, syndicate, governmental
entity or other entity;
(ar)
‘Pro Rata Acquisition’ means an acquisition by a Person of Voting Shares or Convertible Securities pursuant to:
(i)
a Dividend Reinvestment Acquisition;
(ii)
a stock dividend, stock split or other event in respect of securities of the Company of one or more particular
classes or series pursuant to which such Person becomes the Beneficial Owner of Voting Shares on the
same pro rata basis as all other holders of securities of the particular class, classes or series;
(iii)
the acquisition or the exercise by the Person of only those rights to purchase Voting Shares or Convertible
Securities, distributed by the Company to that Person in the course of a distribution (other than Rights) to all
holders of securities of the Company of one or more particular classes or series pursuant to a rights offering
or pursuant to a prospectus or similar document, provided that the Person does not thereby acquire a greater
percentage of such Voting Shares or Convertible Securities, so offered than the Person’s percentage of
Voting Shares Beneficially Owned immediately prior to such acquisition and that such rights are acquired
directly from the Company and not from any other Person;
(iv)
a distribution of Voting Shares, or Convertible Securities (and the conversion or exchange of such
Convertible Securities), by the Company made pursuant to a prospectus (or similar document) or by way of a
private placement or securities exchange take-over bid provided that the Person does not thereby acquire a
greater percentage of such Voting Shares, or Convertible Securities, so offered in the distribution than the
Person’s percentage of Voting Shares Beneficially Owned immediately prior to such acquisition; or
(v)
a distribution of Voting Shares, or Convertible Securities (and the conversion or exchange of such
Convertible Securities), by the Company made pursuant to a securities exchange take-over bid circular
issued by the Company or in a management proxy circular (or similar document) or by way of a private
placement, in respect of a merger pursuant to which the Company acquires all or substantially all of the
assets of another Person in exchange for Voting Shares or Convertible Securities (and the conversion or
exchange of such Convertible Securities) on terms approved by the Board of Directors in good faith, provided
that in the case
13
Exhibit 4.1
of such acquisition transaction or private placement (i) all necessary stock exchange approvals for such
private placement have been obtained and such private placement complies with the terms and conditions of
such approvals, and (ii) the Person does not thereby become the Beneficial Owner of more than 25% of the
Voting Shares of the Company outstanding immediately prior to the completion of such acquisition
transaction or private placement and in making this determination, the Voting Shares (or Convertible
Securities) to be issued to such Person shall be deemed to be held by such Person but shall not be included
in the aggregate number of outstanding Voting Shares immediately prior to the completion of such acquisition
transaction or private placement;
(as)
‘Record Time’ means February 22, 2007;
(at)
‘Redemption Price’ has the meaning ascribed thereto under Subsection 5.1(b) of this Agreement;
(au)
‘Right’ means a right to purchase a Common Share upon the terms and subject to the conditions set forth in this
Agreement;
(av)
‘Rights Certificate’ means the certificates representing the Rights after the Separation Time, which shall be
substantially in the form attached hereto as Attachment 1 or such other form as the Company and the Rights Agent
may agree;
(aw)
‘Rights Register’ has the meaning ascribed thereto in Subsection 2.6(a);
(ax)
‘Rights Registrar’ has the meaning ascribed thereto in Subsection 2.6(a);
(ay)
‘Securities Act (British Columbia)’ means the Securities Act, R.S.B.C. 1996 Chapter 418, as amended, and the
regulations and rules thereunder, and any comparable or successor laws or regulations and rules thereto;
(az)
‘Separation Time’ means the close of business on the tenth Trading Day after the earlier of:
(i)
the Stock Acquisition Date;
(ii)
the date of the commencement of or first public announcement of the intent of any Person (other than the
Company or any Subsidiary of the Company) to commence a Take-over Bid (other than a Permitted Bid or a
Competing Permitted Bid); and
(iii)
the date on which a Permitted Bid or Competing Permitted Bid ceases to be such;
or such later time as may be determined by the Board of Directors acting in good faith, and provided that, if any
Take-over Bid referred to in Subsection (ii) or Permitted Bid or Competing Permitted Bid referred to in Subsection (iii)
is not made, expires, is cancelled, terminated or otherwise withdrawn prior to the
14
Exhibit 4.1
Separation Time, such Take-over Bid, Permitted Bid or Competing Permitted Bid, as applicable, shall be deemed, for
the purposes of this definition, never to have been made;
(ba)
‘Stock Acquisition Date’ means the first date of public announcement (which, for purposes of this definition, shall
include, without limitation, a report filed pursuant to section 5.2 of NI 62-104 or Section 13(d) of the 1934 Exchange
Act) by an Acquiring Person that he, she or it has become an Acquiring Person, or such later date as determined by
the Board of Directors acting in good faith;
(bb)
‘Subsidiary’: a corporation is a Subsidiary of another corporation if:
(i)
it is controlled by:
(A)
that other; or
(B)
that other and one or more corporations, each of which is controlled by that other; or
(C)
two or more corporations, each of which is controlled by that other; or
(ii)
it is a Subsidiary of a corporation that is that other’s Subsidiary;
(bc)
‘Take-over Bid’ means an Offer to Acquire Voting Shares, or Convertible Securities if, assuming that the Voting
Shares or Convertible Securities subject to the Offer to Acquire are acquired and are Beneficially Owned at the date
of such Offer to Acquire by the Person making such Offer to Acquire, such Voting Shares (including Voting Shares
that may be acquired upon the conversion, exchange or exercise of the rights under such Convertible Securities into
Voting Shares) together with the Offeror’s Securities, constitute in the aggregate 20% or more of the outstanding
Voting Shares at the date of the Offer to Acquire;
(bd)
‘Termination Time’ means the time at which the right to exercise Rights shall terminate pursuant to
Subsection 5.1(e);
(be)
‘Trading Day’, when used with respect to any securities, means a day on which the principal stock exchange in the
United States of America on which such securities are listed or admitted to trading is open for the transaction of
business or, if the securities are not listed or admitted to trading on any stock exchange in the United States of
America, a Business Day;
(bf)
‘U.S.-Canadian Exchange Rate’ means, on any date:
(i)
if on such date the Bank of Canada sets an average noon spot rate of exchange for the conversion of one
United States dollar into Canadian dollars, such rate; and
(ii)
in any other case, the rate for such date for the conversion of one United States dollar into Canadian dollars
calculated in such manner as may be
15
Exhibit 4.1
determined by the Board of Directors from time to time acting in good faith;
(bg)
‘U.S. Dollar Equivalent’ of any amount which is expressed in Canadian dollars means, on any date, the United
States dollar equivalent of the amount determined by multiplying the amount by the Canadian-U.S. Exchange Rate
in effect on such date;
(bh)
‘Voting Share Reduction’ means an acquisition or redemption by the Company of Voting Shares which, by
reducing the number of Voting Shares outstanding, increases the proportionate number of Voting Shares Beneficially
Owned by any Person to 20% or more of the Voting Shares then outstanding; and
(bi)
‘Voting Shares’ means the Common Shares and any other shares in the capital of the Company entitled to vote
generally in the election of all directors.
1.2
Currency
All sums of money which are referred to in this Agreement are expressed in lawful money of the United States of
America, unless otherwise specified.
1.3
Headings and Interpretation
The division of this Agreement into Articles, Sections, Subsections, Clauses, Paragraphs, Subparagraphs or other
portions hereof and the insertion of headings, subheadings and a table of contents are for convenience of reference only and shall
not affect the construction or interpretation of this Agreement. In this Agreement, where the context so admits, words importing the
singular include the plural and vice versa and words importing gender includes the masculine, feminine and neuter genders.
1.4
Calculation of Number and Percentage of Beneficial Ownership of Outstanding Voting Shares
For purposes of this Agreement, the percentage of Voting Shares Beneficially Owned by any Person, shall be and be
deemed to be the product (expressed as a percentage) determined by the formula:
100 x A/B
where:
A = the number of votes for the election of all directors generally attaching to the Voting Shares Beneficially
Owned by such Person; and
B = the number of votes for the election of all directors generally attaching to all outstanding Voting Shares.
16
Exhibit 4.1
Where any Person is deemed to Beneficially Own unissued Voting Shares, such Voting Shares shall be deemed to be outstanding
for the purpose of calculating the percentage of Voting Shares Beneficially Owned by such Person, but no other unissued Voting
Shares shall, for the purposes of such calculation, be deemed to be outstanding.
1.5
Acting Jointly or in Concert
For the purposes of this Agreement, a Person is acting jointly or in concert with every Person who is a party to any
agreement, commitment or understanding (whether formal or informal and whether or not in writing) with the first Person (the ‘First
Person’) or any Associate or Affiliate thereof or any other Person acting jointly or in concert with the First Person, to acquire or
Offer to Acquire Voting Shares (other than customary agreements with and between underwriters or banking group members or
selling group members with respect to a public offering or private placement of securities or pledges of securities in the ordinary
course of business).
1.6
Generally Accepted Accounting Principles
Wherever in this Agreement reference is made to generally accepted accounting principles, such reference shall be
deemed to be the recommendations at the relevant time of the Canadian Institute of Chartered Accountants, or any successor
institute, applicable on a consolidated basis (unless otherwise specifically provided herein to be applicable on an unconsolidated
basis) as at the date on which a calculation is made or required to be made in accordance with Canadian generally accepted
accounting principles. Where the character or amount of any asset or liability or item of revenue or expense is required to be
determined, or any consolidation or other accounting computation is required to be made for the purpose of this Agreement or any
document, such determination or calculation shall, to the extent applicable and except as otherwise specified herein or as otherwise
agreed in writing by the parties, be made in accordance with generally accepted accounting principles applied on a consistent
basis.
Article 2
- THE RIGHTS
2.1
Issue of Rights: Legend on Common Share Certificates
(a)
One Right shall be issued in respect of each Common Share issued after the Record Time and prior to the earlier of
the Separation Time and the Expiration Time.
(b)
Certificates representing Common Shares which are issued after the Record Time, but prior to the earlier of the
Separation Time and the Expiration Time shall evidence one Right for each Common Share represented thereby.
Certificates representing Common Shares that are issued after the Record Time but prior to the earlier of the
Separation Time and the Expiration Time shall have impressed on, printed on, written on or otherwise affixed to them
the legend set out in the Original Agreement or a legend substantially in the following form:
17
Exhibit 4.1
“Until the Separation Time (defined in the Agreement below), this certificate also evidences the
holder’s rights described in the Second Amended and Restated Shareholder Rights Plan Agreement
dated as of February 24, 2025, and as may be further amended, modified or supplemented from time
to time (the ‘Agreement’) between RB Global, Inc. and Computershare Investor Services Inc., as the
same may from time to time be amended, the terms of which are incorporated herein and a copy of
which is available upon request without charge. Under certain circumstances set out in the
Agreement, the Rights may be amended or redeemed, may expire, may become void (if, in certain
circumstances, they are ‘Beneficially Owned’ by an ‘Acquiring Person’, as such terms are defined in
the Agreement, or a transferee thereof) or may be evidenced by separate certificates and no longer
evidenced by this certificate.”
Certificates representing Common Shares that are issued and outstanding at the Record Time shall evidence one
Right for each Common Share evidenced thereby, notwithstanding the absence of the legend set out in the Original
Agreement or a legend in accordance with this Subsection 2.1(b), until the earlier of the Separation Time and the
Expiration Time.
Registered holders of Common Shares who have not received a share certificate and are entitled to do so on the
earlier of the Separation Time and Expiration Time shall be entitled to Rights as if such certificates had been issued
and such Rights shall for all purposes hereof be evidenced by the corresponding entries on the Company’s
securities register for Common Shares.
2.2
Initial Exercise Price; Exercise of Rights; Detachment of Rights
(a)
Subject to Subsection 3.1(a) and adjustment as herein set forth, each Right will entitle the holder thereof, from and
after the Separation Time and prior to the Expiration Time, to purchase one Common Share for the Exercise Price
(and the Exercise Price and number of Common Shares are subject to adjustment as set forth below).
Notwithstanding any other provision of this Agreement, any Rights held by the Company or any of its Subsidiaries
shall be void.
(b)
Until the Separation Time:
(i)
the Rights shall not be exercisable and no Right may be exercised; and
18
Exhibit 4.1
(ii)
for administration purposes, each Right will be evidenced by the certificate for the associated Common Share
registered in the name of the holder thereof (which certificate shall also be deemed to represent a Rights
Certificate) and will be transferable only together with, and will be transferred by a transfer of, such
associated Common Share.
(c)
From and after the Separation Time and prior to the Expiration Time:
(i) the Rights shall be exercisable; and
(ii) the registration and transfer of Rights shall be separate from and independent of Common Shares.
Promptly following the Separation Time, the Company will prepare and the Rights Agent will mail to each holder of
record of Common Shares as of the Separation Time (other than an Acquiring Person and, in respect of any Rights
Beneficially Owned by such Acquiring Person which are not held of record by such Acquiring Person, the holder of
record of such Rights (a ‘Nominee’)), at such holder’s address as shown by the records of the Company (the
Company hereby agreeing to furnish copies of such records to the Rights Agent for this purpose):
(x) a Rights Certificate appropriately completed, representing the number of Rights held by such holder at the
Separation Time and having such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with any law, rule or regulation or with any rule or
regulation of any self-regulatory organization, stock exchange or quotation system on which the Rights may from
time to time be listed or traded, or to conform to standard usage; and
(y) a disclosure statement prepared by the Company describing the Rights,
provided that a Nominee shall be sent the materials provided for in clauses (x) and (y) in respect of all Common
Shares held of record by it which are not Beneficially Owned by an Acquiring Person. In order for the Company to
determine whether any Person is holding Common Shares which are Beneficially Owned by another Person, the
Company may require such first mentioned Person to furnish such documentation and information as the Company
deems necessary.
(d)
Rights may be exercised, in whole or in part, on any Business Day after the Separation Time and prior to the
Expiration Time by submitting to the Rights Agent:
(i)
the Rights Certificate evidencing such Rights;
19
Exhibit 4.1
(ii)
an election to exercise such Rights (an ‘Election to Exercise’) substantially in the form attached to the
Rights Certificate appropriately completed and duly executed by the holder or his executors or administrators
or other personal representatives or his or their legal attorney duly appointed by an instrument in writing in
form and executed in a manner satisfactory to the Rights Agent; and
(iii)
payment by certified cheque, banker’s draft or money order payable to the order of the Company, of a sum
equal to the Exercise Price multiplied by the number of Rights being exercised and a sum sufficient to cover
any transfer tax or governmental charge which may be payable in respect of any transfer involved in the
transfer or delivery of Rights Certificates or the issuance or delivery of certificates for Common Shares in a
name other than that of the holder of the Rights being exercised.
(e)
Upon receipt of a Rights Certificate, together with a completed Election to Exercise executed in accordance with
Subsection 2.2(d)(ii), which does not indicate that such Right is null and void as provided by Subsection 3.1(b), and
payment as set forth in Subsection 2.2(d)(iii), the Rights Agent (unless otherwise instructed by the Company in the
event that the Company is of the opinion that the Rights cannot be exercised in accordance with this Agreement) will
thereupon promptly:
(i)
requisition from the Company’s transfer agent certificates representing the number of such Common Shares
to be purchased (the Company hereby irrevocably authorizing its transfer agent to comply with all such
requisitions);
(ii)
when appropriate, requisition from the Company the amount of cash to be paid in lieu of issuing fractional
Common Shares in accordance with Subsection 5.5(b);
(iii)
after receipt of the certificates referred to in Subsection 2.2(e)(i), deliver the same to or upon the order of the
registered holder of such Rights Certificates, registered in such name or names as may be designated by
such holder;
(iv)
when appropriate, after receipt, deliver the cash referred to in Subsection 2.2(e)(ii) to or to the order of the
registered holder of such Rights Certificate; and
(v)
tender to the Company all payments received on exercise of Rights.
(f)
In case the holder of any Rights shall exercise less than all the Rights evidenced by such holder’s Rights Certificate,
a new Rights Certificate evidencing the Rights remaining unexercised (subject to the provisions of Subsection 5.5(a))
will be issued by the Rights Agent to such holder or to such holder’s duly authorized assigns.
(g)
The Company covenants and agrees that it will:
20
Exhibit 4.1
(i)
take all such action as may be necessary and within its power to ensure that all Common Shares delivered
upon exercise of Rights shall, at the time of delivery of the certificates for such Common Shares (subject to
payment of the Exercise Price), be duly and validly authorized, executed, issued and delivered as fully paid
and non-assessable;
(ii)
take all such action as may be necessary and within its power to comply with the requirements of the
Business Corporations Act (Ontario), the Securities Act (British Columbia), the securities laws or comparable
legislation of each of the provinces and territories of Canada, the 1933 Securities Act and the 1934 Exchange
Act and the rules and regulations thereunder and any other applicable law, rule or regulation, in connection
with the issuance and delivery of the Rights Certificates and the issuance of any Common Shares upon
exercise of Rights;
(iii)
use reasonable efforts to cause all Common Shares issued upon exercise of Rights to be listed on the
principal stock exchanges on which such Common Shares were traded immediately prior to the Stock
Acquisition Date;
(iv)
cause to be reserved and kept available out of the authorized and unissued Common Shares, the number of
Common Shares that, as provided in this Agreement, will from time to time be sufficient to permit the exercise
in full of all outstanding Rights;
(v)
pay when due and payable, if applicable, any and all Canadian and foreign federal, provincial, state and
other transfer taxes and charges (not including any income or capital taxes of the holder or exercising holder
or any liability of the Company to withhold tax) which may be payable in respect of the original issuance or
delivery of the Rights Certificates, or certificates for Common Shares to be issued upon exercise of any
Rights, provided that the Company shall not be required to pay any transfer tax or charge which may be
payable in respect of any transfer involved in the transfer or delivery of Rights Certificates or the issuance or
delivery of certificates for Common Shares in a name other than that of the holder of the Rights being
transferred or exercised; and
(vi)
after the Separation Time, except as permitted by Section 5.1, not take (or permit any Subsidiary to take) any
action if at the time such action is taken it is reasonably foreseeable that such action will diminish
substantially or otherwise eliminate the benefits intended to be afforded by the Rights.
2.3
Adjustments to Exercise Price; Number of Rights
The Exercise Price, the number and kind of securities subject to purchase upon exercise of each Right and the
number of Rights outstanding are subject to adjustment from time to time as provided in this Section 2.3.
(a)
In the event the Company shall at any time after the date of this Agreement:
21
Exhibit 4.1
(i)
declare or pay a dividend on Common Shares payable in Common Shares (or other securities exchangeable
for or convertible into or giving a right to acquire Common Shares or other securities of the Company) other
than pursuant to any optional stock dividend program;
(ii)
subdivide or change the then outstanding Common Shares into a greater number of Common Shares;
(iii)
consolidate or change the then outstanding Common Shares into a smaller number of Common Shares; or
(iv)
issue any Common Shares (or other securities exchangeable for or convertible into or giving a right to
acquire Common Shares or other securities of the Company) in respect of, in lieu of or in exchange for
existing Common Shares except as otherwise provided in this Section 2.3,
the Exercise Price and the number of Rights outstanding, or, if the payment or effective date therefor shall occur
after the Separation Time, the securities purchasable upon exercise of Rights shall be adjusted as of the payment or
effective date in the manner set forth below.
If the Exercise Price and number of Rights outstanding are to be adjusted:
(x) the Exercise Price in effect after such adjustment will be equal to the Exercise Price in effect immediately prior
to such adjustment divided by the number of Common Shares (or other capital stock) that a holder of one
Common Share immediately prior to such dividend, subdivision, change, consolidation or issuance would
hold immediately thereafter as a result thereof (for the purpose of this Agreement, ‘Expansion Factor’ shall
mean the number of Common Shares (or other capital stock) that a holder of one Common Share
immediately prior to such dividend, subdivision, change, consolidation or issuance would hold immediately
thereafter as a result thereof divided by 1 Common Share); and
(y) each Right held prior to such adjustment will become that number of Rights equal to the Expansion Factor,
and the adjusted number of Rights will be deemed to be distributed among the Common Shares with respect to
which the original Rights were associated (if they remain outstanding) and the shares issued in respect of such
dividend, subdivision, change, consolidation or issuance, so that each such Common Share (or other capital stock)
will have exactly one Right associated with it.
For greater certainty, if the securities purchasable upon exercise of Rights are to be adjusted, the securities
purchasable upon exercise of each Right immediately
22
Exhibit 4.1
after such adjustment will be the securities that a holder of the securities purchasable upon exercise of one Right
immediately prior to such dividend, subdivision, change, consolidation or issuance would hold immediately
thereafter, including as a result of such dividend, subdivision, change, consolidation or issuance.
If, after the Record Time and prior to the Expiration Time, the Company shall issue any shares of capital stock other
than Common Shares in a transaction of a type described in Subsection 2.3(a)(i) or (iv), shares of such capital stock
shall be treated herein as nearly equivalent to Common Shares as may be practicable and appropriate under the
circumstances and the Company and the Rights Agent agree to amend this Agreement in order to effect such
treatment. If an event occurs which would require an adjustment under both this Section 2.3 and Subsection 3.1(a)
hereof, the adjustment provided for in this Section 2.3 shall be in addition to and shall be made prior to any
adjustment required pursuant to Subsection 3.1(a) hereof. Adjustments pursuant to this Subsection 2.3(a) shall be
made successively, whenever an event referred to in this Subsection 2.3(a) occurs.
In the event the Company shall at any time after the Record Time and prior to the Separation Time issue any
Common Shares otherwise than in a transaction referred to in this Subsection 2.3(a), each such Common Share so
issued shall automatically have one new Right associated with it, which Right shall be evidenced by the certificate
representing such associated Common Share.
(b)
In the event the Company shall at any time after the Record Time and prior to the Separation Time fix a record date
for the issuance of rights, options or warrants to all holders of Common Shares entitling them (for a period expiring
within 45 calendar days after such record date) to subscribe for or purchase Common Shares (or securities
convertible into or exchangeable for or carrying a right to purchase Common Shares) at a price per Common Share
(or, if a security convertible into or exchangeable for or carrying a right to purchase or subscribe for Common
Shares, having a conversion, exchange or exercise price, including the price required to be paid to purchase such
convertible or exchangeable security or right per share) less than 90% of the Market Price per Common Share on
such record date, the Exercise Price to be in effect after such record date shall be determined by multiplying the
Exercise Price in effect immediately prior to such record date by a fraction:
(i)
the numerator of which shall be the number of Common Shares outstanding on such record date, plus the
number of Common Shares that the aggregate offering price of the total number of Common Shares so to be
offered (and/or the aggregate initial conversion, exchange or exercise price of the convertible or
exchangeable securities or rights so to be offered, including the price required to be paid to purchase such
convertible or exchangeable securities or rights) would purchase at such Market Price per Common Share;
and
23
Exhibit 4.1
(ii)
the denominator of which shall be the number of Common Shares outstanding on such record date, plus the
number of additional Common Shares to be offered for subscription or purchase (or into which the convertible
or exchangeable securities or rights so to be offered are initially convertible, exchangeable or exercisable).
In case such subscription price may be paid by delivery of consideration, part or all of which may be in a form other
than cash, the value of such consideration shall be as determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent and shall be binding on the Rights Agent
and the holders of Rights. Such adjustment shall be made successively whenever such a record date is fixed, and in
the event that such rights, options or warrants are not so issued, or if issued, are not exercised prior to the expiration
thereof, the Exercise Price shall be readjusted to the Exercise Price which would then be in effect if such record date
had not been fixed, or to the Exercise Price which would be in effect based upon the number of Common Shares (or
securities convertible into, or exchangeable or exercisable for Common Shares) actually issued upon the exercise of
such rights, options or warrants, as the case may be.
For purposes of this Agreement, the granting of the right to purchase Common Shares (whether from unissued
shares or otherwise) pursuant to any Dividend Reinvestment Plan or any employee benefit, stock option or similar
plans shall be deemed not to constitute an issue of rights, options or warrants by the Company; provided, however,
that, in all such cases, the right to purchase Common Shares is at a price per share of not less than 90% of the
current Market Price per share (determined as provided in such plans) of the Common Shares.
(c)
In the event the Company shall at any time after the Record Time and prior to the Separation Time fix a record date
for the making of a distribution to all holders of Common Shares (including any such distribution made in connection
with a merger or amalgamation or statutory arrangement) of evidences of indebtedness, cash (other than an annual,
quarterly monthly or routine cash dividend or a dividend referred to in Subsection 2.3(a)(i), but including any dividend
payable in other securities of the Company other than Common Shares), assets or rights, options or warrants
(excluding those referred to in Subsection 2.3(b)), the Exercise Price to be in effect after such record date shall be
determined by multiplying the Exercise Price in effect immediately prior to such record date by a fraction:
(i)
the numerator of which shall be the Market Price per Common Share on such record date, less the fair
market value (as determined in good faith by the Board of Directors, whose determination shall be described
in a statement filed with the Rights Agent and shall be binding on the Rights Agent and the holders of Rights),
on a per share basis, of the portion of the cash, assets, evidences of indebtedness, rights, options or
warrants so to be distributed; and
24
Exhibit 4.1
(ii)
the denominator of which shall be such Market Price per Common Share.
Such adjustments shall be made successively whenever such a record date is fixed, and in the event that such a
distribution is not so made, the Exercise Price shall be adjusted to be the Exercise Price which would have been in
effect if such record date had not been fixed.
(d)
Notwithstanding anything herein to the contrary, no adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least one per cent in the Exercise Price; provided, however,
that any adjustments which by reason of this Subsection 2.3(d) are not required to be made shall be carried forward
and taken into account in any subsequent adjustment. All calculations under Section 2.3 shall be made to the
nearest cent or to the nearest ten-thousandth of a share. Notwithstanding the first sentence of this
Subsection 2.3(d), any adjustment required by Section 2.3 shall be made no later than the earlier of:
(i)
three years from the date of the transaction which gives rise to such adjustment; or
(ii)
the Expiration Time.
(e)
In the event the Company shall at any time after the Record Time and prior to the Separation Time issue any shares
(other than Common Shares), or rights, options or warrants to subscribe for or purchase any such shares, or
securities convertible into or exchangeable for any such shares, in a transaction referred to in Subsections 2.3(a)(i)
or (a)(iv), if the Board of Directors acting in good faith determines that the adjustments contemplated by Subsections
2.3(a), (b), (c) and (d) in connection with such transaction will not appropriately protect the interests of the holders of
Rights, the Board of Directors may determine what other adjustments to the Exercise Price, number of Rights and/or
securities purchasable upon exercise of Rights would be appropriate and, notwithstanding Subsections 2.3(a), (b),
(c) and (d), such adjustments, rather than the adjustments contemplated by Subsections 2.3(a), (b), (c) and (d), shall
be made. Subject to Subsections 5.4(b) and 5.4(c), the Company and the Rights Agent may amend this Agreement
as appropriate to provide for such adjustments.
(f)
Each Right originally issued by the Company subsequent to any adjustment made to the Exercise Price hereunder
shall evidence the right to purchase, at the adjusted Exercise Price, the number of Common Shares purchasable
from time to time hereunder upon exercise of a Right immediately prior to such issue, all subject to further
adjustment as provided herein.
(g)
Irrespective of any adjustment or change in the Exercise Price or the number of Common Shares issuable upon the
exercise of the Rights, the Rights Certificates theretofore and thereafter issued may continue to express the Exercise
Price per Common Share and the number of Common Shares which were expressed in the initial Rights Certificates
issued hereunder.
25
Exhibit 4.1
(h)
In any case in which this Section 2.3 shall require that an adjustment in the Exercise Price be made effective as of a
record date for a specified event, the Company may elect to defer until the occurrence of such event the issuance to
the holder of any Right exercised after such record date the number of Common Shares and other securities of the
Company, if any, issuable upon such exercise over and above the number of Common Shares and other securities
of the Company, if any, issuable upon such exercise on the basis of the Exercise Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to such holder an appropriate instrument evidencing
such holder’s right to receive such additional shares (fractional or otherwise) or other securities upon the occurrence
of the event requiring such adjustment.
(i)
Notwithstanding anything contained in this Section 2.3 to the contrary, the Company shall be entitled to make such
reductions in the Exercise Price, in addition to those adjustments expressly required by this Section 2.3, as and to
the extent that in their good faith judgment the Board of Directors shall determine to be advisable, in order that any:
(i)
consolidation or subdivision of Common Shares;
(ii)
issuance (wholly or in part for cash) of Common Shares or securities that by their terms are convertible into
or exchangeable for Common Shares;
(iii)
stock dividends; or
(iv)
issuance of rights, options or warrants referred to in this Section 2.3,
(j)
hereafter made by the Company to holders of its Common Shares, subject to applicable taxation laws, shall
not be taxable to such shareholders or shall subject such shareholders to a lesser amount of tax.
(k)
Whenever an adjustment to the Exercise Price is made pursuant to this Section 2.3, the Company shall:
(i)
promptly prepare a certificate setting forth such adjustment and a brief statement of the facts accounting for
such adjustment; and
(ii)
promptly file with the Rights Agent and with each transfer agent for the Common Shares a copy of such
certificate and mail a brief summary thereof to each holder of Rights who requests a copy;
(l)
Failure to file such certificate or to cause such notice to be given as aforesaid, or any defect therein, shall not
affect the validity of any such adjustment or change.
2.4
Date on Which Exercise Is Effective
Each Person in whose name any certificate for Common Shares or other securities, if applicable, is issued upon the
exercise of Rights shall for all purposes be deemed
26
Exhibit 4.1
to have become the holder of record of the Common Shares or other securities, if applicable, represented thereby, and such
certificate shall be dated the date upon which the Rights Certificate evidencing such Rights was duly surrendered in accordance
with Subsection 2.2(d) (together with a duly completed Election to Exercise) and payment of the Exercise Price for such Rights
(and any applicable transfer taxes and other governmental charges payable by the exercising holder hereunder) was made;
provided, however, that if the date of such surrender and payment is a date upon which the Common Share transfer books of the
Company are closed, such Person shall be deemed to have become the record holder of such shares on, and such certificate shall
be dated, the next succeeding Business Day on which the Common Share transfer books of the Company are open.
2.5
Execution, Authentication, Delivery and Dating of Rights Certificates
(a)
The Rights Certificates shall be executed on behalf of the Company by its Chairman of the Board, Chief Executive
Officer, President, Chief Financial Officer or any Vice-President and by its Corporate Secretary or any Assistant
Secretary under the corporate seal of the Company reproduced thereon. The signature of any of these officers on
the Rights Certificates may be manual or facsimile. Rights Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that
such individuals or any of them have ceased to hold such offices either before or after the countersignature and
delivery of such Rights Certificates.
(b)
Promptly after the Company learns of the Separation Time, the Company will notify the Rights Agent of such
Separation Time and will deliver Rights Certificates executed by the Company to the Rights Agent for
countersignature, and the Rights Agent shall manually countersign (in a manner satisfactory to the Company) and
send such Rights Certificates to the holders of the Rights pursuant to Subsection 2.2(c) hereof. No Rights Certificate
shall be valid for any purpose until countersigned by the Rights Agent as aforesaid.
(c)
Each Rights Certificate shall be dated the date of countersignature thereof.
2.6
Registration, Transfer and Exchange
(a)
The Company will cause to be kept a register (the ‘Rights Register’) in which, subject to such reasonable
regulations as it may prescribe, the Company will provide for the registration and transfer of Rights. The Rights
Agent is hereby appointed registrar for the Rights (the ‘Rights Registrar’) for the purpose of maintaining the Rights
Register for the Company and registering Rights and transfers of Rights as herein provided and the Rights Agent
hereby accepts such appointment. In the event that the Rights Agent shall cease to be the Rights Registrar, the
Rights Agent will have the right to examine the Rights Register at all reasonable times.
After the Separation Time and prior to the Expiration Time, upon surrender for registration of transfer or exchange of
any Rights Certificate, and subject to the
27
Exhibit 4.1
provisions of Subsection 2.6(c), the Company will execute, and the Rights Agent will manually countersign and
deliver, in the name of the holder or the designated transferee or transferees, as required pursuant to the holder’s
instructions, one or more new Rights Certificates evidencing the same aggregate number of Rights as did the Rights
Certificates so surrendered.
(b)
All Rights issued upon any registration of transfer or exchange of Rights Certificates shall be the valid obligations of
the Company, and such Rights shall be entitled to the same benefits under this Agreement as the Rights
surrendered upon such registration of transfer or exchange.
(c)
Every Rights Certificate surrendered for registration of transfer or exchange shall be duly endorsed, or be
accompanied by a written instrument of transfer satisfactory in form to the Company or the Rights Agent, as the case
may be, duly executed by the holder thereof or such holder’s attorney duly authorized in writing. As a condition to the
issuance of any new Rights Certificate under this Section 2.6, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other
expenses (including the reasonable fees and expenses of the Rights Agent) connected therewith.
2.7
Mutilated, Destroyed, Lost and Stolen Rights Certificates
(a)
If any mutilated Rights Certificate is surrendered to the Rights Agent prior to the Expiration Time, the Company shall
execute and the Rights Agent shall countersign and deliver in exchange therefor a new Rights Certificate evidencing
the same number of Rights as did the Rights Certificate so surrendered.
(b)
If there shall be delivered to the Company and the Rights Agent prior to the Expiration Time:
(i)
evidence to their reasonable satisfaction of the destruction, loss or theft of any Rights Certificate; and
(ii)
such security and indemnity as may be reasonably required by them to save each of them and any of their
agents harmless;
then, in the absence of notice to the Company or the Rights Agent that such Rights Certificate has been acquired by
a bona fide purchaser, the Company shall execute and upon the Company’s request the Rights Agent shall
countersign and deliver, in lieu of any such destroyed, lost or stolen Rights Certificate, a new Rights Certificate
evidencing the same number of Rights as did the destroyed, lost or stolen Rights Certificate.
(c)
As a condition to the issuance of any new Rights Certificate under this Section 2.7, the Company may require the
payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto
and any other expenses (including the reasonable fees and expenses of the Rights Agent) connected therewith.
28
Exhibit 4.1
(d)
Every new Rights Certificate issued pursuant to this Section 2.7 in lieu of any destroyed, lost or stolen Rights
Certificate shall evidence the contractual obligation of the Company, whether or not the destroyed, lost or stolen
Rights Certificate shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this
Agreement equally and proportionately with any and all other Rights duly issued hereunder.
2.8
Persons Deemed Owners of Rights
The Company, the Rights Agent and any agent of the Company or the Rights Agent may deem and treat the Person
in whose name a Rights Certificate (or, prior to the Separation Time, the associated Common Share certificate) is registered as the
absolute owner thereof and of the Rights evidenced thereby for all purposes whatsoever. As used in this Agreement, unless the
context otherwise requires, the term ‘holder’ of any Rights shall mean the registered holder of such Rights (or, prior to the
Separation Time, of the associated Common Shares).
2.9
Delivery and Cancellation of Certificates
All Rights Certificates surrendered upon exercise or for redemption, registration of transfer or exchange shall, if
surrendered to any Person other than the Rights Agent, be delivered to the Rights Agent and, in any case, shall be promptly
cancelled by the Rights Agent. The Company may at any time deliver to the Rights Agent for cancellation any Rights Certificates
previously countersigned and delivered hereunder which the Company may have acquired in any manner whatsoever, and all
Rights Certificates so delivered shall be promptly cancelled by the Rights Agent. No Rights Certificate shall be countersigned in lieu
of or in exchange for any Rights Certificates cancelled as provided in this Section 2.9, except as expressly permitted by this
Agreement. The Rights Agent shall, subject to applicable laws, and its ordinary business practices, destroy all cancelled Rights
Certificates and deliver a certificate of destruction to the Company.
2.10
Agreement of Rights Holders
Every holder of Rights, by accepting the same, consents and agrees with the Company and the Rights Agent and
with every other holder of Rights:
(a)
to be bound by and subject to the provisions of this Agreement, as amended from time to time in accordance with
the terms hereof, in respect of all Rights held;
(b)
that prior to the Separation Time, each Right will be transferable only together with, and will be transferred by a
transfer of, the associated Common Share certificate representing such Right;
(c)
that after the Separation Time, the Rights Certificates will be transferable only on the Rights Register as provided
herein;
29
Exhibit 4.1
(d)
that prior to due presentment of a Rights Certificate (or, prior to the Separation Time, the associated Common Share
certificate) for registration of transfer, the Company, the Rights Agent and any agent of the Company or the Rights
Agent may deem and treat the Person in whose name the Rights Certificate (or, prior to the Separation Time, the
associated Common Share certificate) is registered as the absolute owner thereof and of the Rights evidenced
thereby (notwithstanding any notations of ownership or writing on such Rights Certificate or the associated Common
Share certificate made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and
neither the Company nor the Rights Agent shall be affected by any notice to the contrary;
(e)
that such holder of Rights has waived his right to receive any fractional Rights or any fractional shares or other
securities upon exercise of a Right (except as provided herein);
(f)
that, subject to the provisions of Section 5.4, without the approval of any holder of Rights or Voting Shares and upon
the sole authority of the Board of Directors, acting in good faith, this Agreement may be supplemented or amended
from time to time to cure any ambiguity or to correct or supplement any provision contained herein which may be
inconsistent with the intent of this Agreement or is otherwise defective, as provided herein; and
(g)
notwithstanding anything in this Agreement to the contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or any other Person as a result of its inability to perform any of its obligations under
this Agreement by reason of any preliminary or permanent injunction or other order, decree or ruling issued by a
court of competent jurisdiction or by a governmental, regulatory or administrative agency or commission, or any
statute, rule, regulation or executive order promulgated or enacted by any governmental authority, prohibiting or
otherwise restraining performance of such obligation.
2.11
Holder of Rights Not Deemed a Shareholder
No holder, as such, of any Rights or Rights Certificate shall be entitled to vote, receive dividends or be deemed for
any purpose whatsoever the holder of any Common Share or any other share or security of the Company which may at any time be
issuable on the exercise of such Rights, nor shall anything contained herein or in any Rights Certificate be construed or deemed or
confer upon the holder of any Right or Rights Certificate, as such, any right, title, benefit or privilege of a holder of Common Shares
or any other shares or securities of the Company or any right to vote at any meeting of shareholders of the Company whether for
the election of directors or otherwise or upon any matter submitted to holders of Common Shares or any other shares of the
Company at any meeting thereof, or to give or withhold consent to any action of the Company, or to receive notice of any meeting
or other action affecting any holder of Common Shares or any other shares of the Company except as expressly provided herein, or
to receive dividends, distributions or subscription rights, or otherwise, until the Right or Rights evidenced by Rights Certificates shall
have been duly exercised in accordance with the terms and provisions hereof.
30
Exhibit 4.1
Article 3
- ADJUSTMENTS TO THE RIGHTS
IN THE EVENT OF A FLIP-IN EVENT
3.1
Flip-in Event
(a)
Subject to Subsection 3.1(b) and Section 5.1, if prior to the Expiration Time a Flip-in Event occurs, each Right shall
constitute, effective at the close of business on the tenth Trading Day after the Stock Acquisition Date, the right to
purchase from the Company, upon exercise thereof in accordance with the terms hereof, that number of Common
Shares having an aggregate Market Price on the date of consummation or occurrence of such Flip-in Event equal to
twice the Exercise Price for an amount in cash equal to the Exercise Price (such right to be appropriately adjusted in
a manner analogous to the applicable adjustment provided for in Section 2.3 in the event that after such
consummation or occurrence, an event of a type analogous to any of the events described in Section 2.3 shall have
occurred).
(b)
Notwithstanding anything in this Agreement to the contrary, upon the occurrence of any Flip-in Event, any Rights that
are or were Beneficially Owned on or after the earlier of the Separation Time or the Stock Acquisition Date by:
(i)
an Acquiring Person (or any Affiliate or Associate of an Acquiring Person or any Person acting jointly or in
concert with an Acquiring Person or any Affiliate or Associate of an Acquiring Person); or
(ii)
a transferee of or other successor in title or ownership to Rights (a ‘transferee’), directly or indirectly, from an
Acquiring Person (or any Affiliate or Associate of an Acquiring Person or any Person acting jointly or in
concert with an Acquiring Person or any Affiliate or Associate of an Acquiring Person), where such transferee
becomes a transferee concurrently with or subsequent to the Acquiring Person becoming an Acquiring
Person in a transfer that the Board of Directors has determined is part of a plan, arrangement or scheme of
an Acquiring Person (or any Affiliate or Associate of an Acquiring Person or any Person acting jointly or in
concert with an Acquiring Person or any Affiliate or Associate of an Acquiring Person), that has the purpose or
effect of avoiding Subsection 3.1(b)(i),
shall become null and void without any further action, and any holder of such Rights (including transferees) shall
thereafter have no right to exercise or transfer such Rights under any provision of this Agreement and further shall
thereafter not have any other rights whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise. The holder of any Rights represented by a Rights Certificate which is submitted to the
Rights Agent upon exercise or for registration of transfer or exchange on which the holder fails to certify upon the
transfer or exchange in the place set forth in the Rights Certificate establishing that such holder is not a Person
described in either Subsection 3.1(b)(i) or (ii) above shall be deemed to be Beneficially Owned by an
31
Exhibit 4.1
Acquiring Person for the purposes of this Subsection 3.1(b) and such rights shall be null and void.
(c)
From and after the Separation Time, the Company shall do all such acts and things as shall be necessary and within
its power to ensure compliance with the provisions of this Section 3.1, including without limitation, all such acts and
things as may be required to satisfy the requirements of the Business Corporations Act (Ontario), the Securities Act
(British Columbia) and the securities laws or comparable legislation of each of the provinces and territories of
Canada, the 1933 Securities Act and the 1934 Exchange Act and the rules and regulations thereunder and any other
applicable law, rule or regulation in respect of the issue of Common Shares upon the exercise of Rights in
accordance with this Agreement.
(d)
Any Rights Certificate that represents Rights Beneficially Owned by a Person described in either Subsection 3.1(b)(i)
or (ii) or transferred to any nominee of any such Person, and any Rights Certificate issued upon transfer, exchange,
replacement or adjustment of any other Rights Certificate referred to in this sentence, shall contain the following
legend:
“The Rights represented by this Rights Certificate were issued to a Person who was an Acquiring
Person or an Affiliate or an Associate of an Acquiring Person (as such terms are defined in the
Second Amended and Restated Shareholder Rights Plan Agreement) or a Person who was acting
jointly or in concert with an Acquiring Person or an Affiliate or Associate of an Acquiring Person. This
Rights Certificate and the Rights represented hereby are void or shall become void in the
circumstances specified in Subsection 3.1(b) of the Second Amended and Restated Shareholder
Rights Plan Agreement.”
provided, however, that the Rights Agent shall not be under any responsibility to ascertain the existence of facts that
would require the imposition of such legend but shall impose such legend only if instructed to do so by the Company
in writing or if a holder fails to certify upon transfer or exchange in the space provided on the Rights Certificate that
such holder is not a Person described in such legend. Notwithstanding the foregoing, the issuance of a Rights
Certificate which does not bear the legend referred to in this Subsection 3.1(d) shall not invalidate or have any effect
on the provisions of Subsection 3.1(b).
Article 4
- THE RIGHTS AGENT
4.1
General
(a)
The Company hereby confirms the Rights Agent to act as agent for the Company and the holders of the Rights in
accordance with the terms and conditions hereof, and the Rights Agent hereby confirms such appointment. The
Company may
32
Exhibit 4.1
from time to time appoint such co-Rights Agents (‘Co-Rights Agents’) as it may deem necessary or desirable,
subject to the approval of the Rights Agent. In the event the Company appoints one or more Co-Rights Agents, the
respective duties of the Rights Agent and Co-Rights Agents shall be as the Company may determine, with the
approval of the Rights Agent and the Co-Rights Agent. The Company agrees to pay all reasonable fees and
expenses of the Rights Agent in respect of the performance of its duties under this Agreement. The Company also
agrees to indemnify the Rights Agent, its officers, directors, and employees for, and to hold them harmless against,
any loss, liability, or expense, incurred without gross negligence, bad faith or wilful misconduct on the part of the
Rights Agent, for anything done or omitted by the Rights Agent in connection with the acceptance and administration
of this Agreement, including the costs and expenses of defending against any claim of liability, which right to
indemnification will survive the termination of this Agreement or the resignation or removal of the Rights Agent.
(b)
The Rights Agent shall be protected and shall incur no liability for or in respect of any action taken, suffered or
omitted by it in connection with its administration of this Agreement in reliance upon any certificate for Common
Shares, Rights Certificate, certificate for other securities of the Company, instrument of assignment or transfer,
power of attorney, endorsement, affidavit, letter, notice, direction, consent, certificate, opinion, statement, or other
paper or document believed by it in good faith to be genuine and to be signed, executed and, where necessary,
verified or acknowledged, by the proper Person or Persons.
(c)
The Company shall inform the Rights Agent in a reasonably timely manner of events which may materially affect the
administration of this Agreement by the Rights Agent and, at any time upon request, shall provide to the Rights
Agent an incumbency certificate certifying the then current officers of the Company; provided that failure to inform
the Rights Agent of any such events, or any defect therein shall not affect the validity of any action taken hereunder
in relation to such events.
(d)
Notwithstanding any other provision of this Agreement, and whether such losses or damages are foreseeable or
unforeseeable, the Rights Agent shall not be liable under any circumstances whatsoever for any (i) breach by any
other party of securities law or other rule of any securities regulatory authority, (ii) lost profits or (iii) special, indirect,
incidental, consequential, exemplary, aggravated or punitive losses or damages.
(e)
Notwithstanding any other provision of this Agreement, any liability of the Rights Agent shall be limited, in the
aggregate, to the amount of fees paid by the Company to the Rights Agent under this Agreement in the twelve (12)
months immediately prior to the Rights Agent receiving the first notice of the claim.
4.2
Merger, Amalgamation or Consolidation or Change of Name of Rights Agent
(a)
Any corporation into which the Rights Agent may be merged or amalgamated or with which it may be consolidated,
or any corporation resulting from any merger, amalgamation, statutory arrangement or consolidation to which the
Rights Agent is a party, or any corporation succeeding to the shareholder or stockholder
33
Exhibit 4.1
services business of the Rights Agent, will be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Rights Agent under the provisions of Section 4.4
hereof. If, at the time such successor Rights Agent succeeds to the agency created by this Agreement, any of the
Rights Certificates have been countersigned but not delivered, the successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Rights Certificates so countersigned; and if, at
that time, any of the Rights have not been countersigned, any successor Rights Agent may countersign such Rights
Certificates in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in all
such cases such Rights Certificates will have the full force provided in the Rights Certificates and in this Agreement.
(b)
If, at any time, the name of the Rights Agent is changed and at such time any of the Rights Certificates have been
countersigned but not delivered, the Rights Agent may adopt the countersignature under its prior name and deliver
Rights Certificates so countersigned; and if, at that time, any of the Rights Certificates have not been countersigned,
the Rights Agent may countersign such Rights Certificates either in its prior name or in its changed name; and in all
such cases such Rights Certificates shall have the full force provided in the Rights Certificates and in this
Agreement.
4.3
Duties of Rights Agent
The Rights Agent undertakes the duties and obligations imposed by this Agreement upon the following terms and
conditions, all of which the Company and the holders of Rights and Rights Certificates, by their acceptance thereof, shall be bound:
(a)
the Rights Agent, at the expense of the Company, may consult with and retain legal counsel (who may be legal
counsel for the Company) and such other experts as it reasonably considers necessary to perform its duties
hereunder, and the opinion of such counsel or other expert will be full and complete authorization and protection to
the Rights Agent as to any action taken or omitted by it in good faith and in accordance with such opinion;
(b)
whenever in the performance of its duties under this Agreement, the Rights Agent deems it necessary or desirable
that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof is specifically prescribed herein) is deemed to be
conclusively proved and established by a certificate signed by a Person believed by the Rights Agent to be the
Chairman of the Board, President, Chief Executive Officer, Chief Financial Officer, any Vice-President, Treasurer,
Corporate Secretary, or any Assistant Secretary of the Company and delivered to the Rights Agent; and such
certificate will be full authorization to the Rights Agent for any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate;
(c)
notwithstanding anything to the contrary, the Rights Agent will be liable hereunder for its own gross negligence, bad
faith or wilful misconduct;
34
Exhibit 4.1
(d)
the Rights Agent will not be liable for or by reason of any of the statements of fact or recitals contained in this
Agreement or in the certificates for Common Shares or the Rights Certificates (except its countersignature thereof)
or be required to verify the same, but all such statements and recitals are and will be deemed to have been made by
the Company only;
(e)
the Rights Agent will not have any responsibility in respect of the validity of this Agreement or the execution and
delivery hereof (except the due authorization, execution and delivery hereof by the Rights Agent) or in respect of the
validity or execution of any certificate for a Common Share or Rights Certificate (except its countersignature thereof);
nor will it be responsible for any breach by the Company of any covenant or condition contained in this Agreement or
in any Rights Certificate; nor will it be responsible for any change in the exercisability of the Rights (including the
Rights becoming void pursuant to Subsection 3.1(b) hereof) or any adjustment required under the provisions of
Section 2.3 hereof or responsible for the manner, method or amount of any such adjustment or the ascertaining of
the existence of facts that would require any such adjustment (except with respect to the exercise of Rights after
receipt of the certificate contemplated by Section 2.3 describing any such adjustment); nor is it deemed by any act
hereunder to make any representation or warranty as to the authorization of any Common Shares to be issued
pursuant to this Agreement or any Rights or as to whether any Common Shares will, when issued, be duly and
validly authorized, executed, issued and delivered and fully paid and non-assessable;
(f)
the Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights Agent of the provisions of this
Agreement;
(g)
the Rights Agent is hereby authorized and directed to accept instructions in writing with respect to the performance
of its duties hereunder from any individual believed by the Rights Agent to be the Chairman of the Board, President,
Chief Executive Officer, Chief Financial Officer, any Vice-President, Corporate Secretary or any Assistant Secretary
of the Company, and to apply to such individuals for advice or instructions in connection with its duties, and it shall
not be liable for any action taken or suffered by it in good faith in accordance with instructions of any such individual;
(h)
the Rights Agent and any shareholder or stockholder, director, officer or employee of the Rights Agent may buy, sell
or deal in Common Shares, Rights or other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise
act as fully and freely as though it were not Rights Agent under this Agreement and nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or for any other legal entity; and
(i)
the Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its
35
Exhibit 4.1
attorneys or agents, and the Rights Agent will not be answerable or accountable for any act, default, neglect or
misconduct of any such attorneys or agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in the selection and continued employment thereof.
4.4
Change of Rights Agent
The Rights Agent may resign and be discharged from its duties under this Agreement upon 60 days’ notice (or such
lesser notice as is acceptable to the Company) in writing mailed to the Company and to each transfer agent of Common Shares by
registered or certified mail. The Company may remove the Rights Agent upon 30 days’ notice in writing, mailed to the Rights Agent
and to each transfer agent of the Common Shares by registered or certified mail. If the Rights Agent should resign or be removed
or otherwise become incapable of acting, the Company will appoint a successor to the Rights Agent. If the Company fails to make
such appointment within a period of 30 days after removal or 60 days after it has been notified in writing of the resignation or
incapacity by the resigning or incapacitated Rights Agent, then by prior written notice to the Company the resigning Rights Agent or
the holder of any Rights (which holder shall, with such notice, submit such holder’s Rights Certificate, if any, for inspection by the
Company), may apply to a court of competent jurisdiction for the appointment of a new Rights Agent, at the Company’s expense.
Any successor Rights Agent, whether appointed by the Company or by such a court, shall be a corporation incorporated under the
laws of Canada or a province thereof authorized to carry on the business of a trust company in the Province of British Columbia.
After appointment, the successor Rights Agent will be vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the predecessor Rights Agent, upon receipt of all
outstanding fees and expenses owing to it, shall deliver and transfer to the successor Rights Agent any property at the time held by
it hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for the purpose. Not later than the
effective date of any such appointment, the Company will file notice thereof in writing with the predecessor Rights Agent and each
transfer agent of the Common Shares and mail a notice thereof in writing to the holders of the Rights in accordance with
Section 5.9. Failure to give any notice provided for in this Section 4.4, however, or any defect therein, shall not affect the legality or
validity of the resignation or removal of the Rights Agent or the appointment of any successor Rights Agent, as the case may be.
4.5
Compliance with Money Laundering Legislation
The Rights Agent shall retain the right not to act and shall not be liable for refusing to act if, due to a lack of
information or for any other reason whatsoever, the Rights Agent reasonably determines that such an act might cause it to be in
non-compliance with any applicable anti-money laundering or anti-terrorist legislation, regulation or guideline. Further, should the
Rights Agent reasonably determine at any time that its acting under this Agreement has resulted in it being in non-compliance with
any applicable anti-money laundering or anti-terrorist legislation, regulation or guideline, then it shall have the right to resign on 30
days’
36
Exhibit 4.1
written notice to the Company, provided: (i) that the Rights Agent’s written notice shall describe the circumstances of such non-
compliance; and (ii) that if such circumstances are rectified to the Rights Agent’s satisfaction (acting reasonably) within such 30-day
period, then such resignation shall not be effective.
4.6
Privacy Provision
The parties acknowledge that federal and/or provincial legislation that addresses the protection of individual’s
personal information (collectively, ‘Privacy Laws’) applies to obligations and activities under this Agreement. Despite any other
provision of this Agreement to the contrary, neither party will take or direct any action that would contravene, or cause the other to
contravene, applicable Privacy Laws. The Company will, prior to transferring or causing to be transferred personal information to
the Rights Agent, obtain and retain required consents of the relevant individuals to the collection, use and disclosure of their
personal information, or will have determined that such consents either have previously been given upon which the parties can rely
or are not required under the Privacy Laws. The Rights Agent will use commercially reasonable efforts to ensure that its services
hereunder comply with Privacy Laws.
4.7
Fiduciary Duties of the Board of Directors
Nothing contained herein shall be construed to suggest or imply that the Board of Directors shall not be entitled to
recommend that shareholders of the Company reject or accept any Take-over Bid or take any other action including the
commencement, prosecution, defence or settlement of any litigation and the solicitation of additional or alternative Take-over Bids
or other proposals to the shareholders of the Company that the Board of Directors believe are necessary or appropriate in the
exercise of their fiduciary duties.
4.8
Liability
Notwithstanding any other provision of this Agreement, and whether such losses or damages are foreseeable or unforeseeable, the
Rights Agent shall not be liable under any circumstances whatsoever for any (a) breach by any other party of securities law or other
rule of any securities regulatory authority, (b) lost profits or (c) special, indirect, incidental, consequential, exemplary, aggravated or
punitive losses or damages.
Article 5
- MISCELLANEOUS
5.1
Redemption and Waiver
(a)
The Board of Directors acting in good faith may, until the occurrence of a Flip-in Event, upon prior written notice
delivered to the Rights Agent, waive the application of Section 3.1 to that particular Flip-in Event provided that the
particular Flip-in Event would result from a Take-over Bid made by way of take-over bid circular sent to all holders of
record of Voting Shares (which for greater certainty shall not include the circumstances described in Subsection
5.1(h)); provided that if the Board of Directors waives the application of Section 3.1 to a
37
Exhibit 4.1
particular Flip-in Event pursuant to this Subsection 5.1(a), the Board of Directors shall be deemed to have waived
the application of Section 3.1 to any other Flip-in Event occurring by reason of any Take-over Bid which is made by
means of a take-over bid circular to all holders of record of Voting Shares prior to the expiry of any Take-over Bid (as
the same may be extended from time to time) in respect of which a waiver is, or is deemed to have been, granted
under this Subsection 5.1(a). If the Board of Directors proposes such a waiver, the Board of Directors may extend
the Separation Time to a date after but not more than 10 Business Days after the meeting of shareholders called to
approve such waiver.
(b)
Subject to the prior consent of the holders of the Voting Shares or the Rights as set forth in Subsection 5.4(b) or (c),
as the case may be, the Board of Directors acting in good faith may, at its option, at any time prior to the provisions
of Section 3.1 becoming applicable as a result of the occurrence of a Flip-in Event, elect to redeem all but not less
than all of the outstanding Rights at a redemption price of $0.000001 per Right appropriately adjusted in a manner
analogous to the applicable adjustment provided for in Section 2.3 if an event of the type analogous to any of the
events described in Section 2.3 shall have occurred (such redemption price being herein referred to as the
‘Redemption Price’).
(c)
Where, pursuant to a Permitted Bid, a Competing Permitted Bid, an Exempt Acquisition or an acquisition for which a
waiver has been granted under Subsection 5.1(a), a Person acquires outstanding Voting Shares, other than Voting
Shares Beneficially Owned by such Person at the date of the Permitted Bid, the Competing Permitted Bid, the
Exempt Acquisition or an acquisition for which a waiver has been granted under Subsection 5.1(a), then the Board of
Directors shall immediately upon the consummation of such acquisition without further formality and without any
approval under Subsection 5.4(b)5.4(c) or (c) be deemed to have elected to redeem the Rights at the Redemption
Price.
(d)
Where a Take-over Bid that is not a Permitted Bid or a Competing Permitted Bid expires, is withdrawn or otherwise
terminates after the Separation Time has occurred and prior to the occurrence of a Flip-in Event, the Board of
Directors may elect to redeem all the outstanding Rights at the Redemption Price.
(e)
If the Board of Directors is deemed under Subsection 5.1(c) to have elected, or elects under either of
Subsection 5.1(b) or (d), to redeem the Rights, the right to exercise the Rights will thereupon, without further action
and without notice, terminate and the only right thereafter of the holders of Rights so redeemed shall be to receive
the Redemption Price.
(f)
Within 10 days after the Board of Directors is deemed under Subsection 5.1(c) to have elected, or elects under
Subsection 5.1(b) or (d), to redeem the Rights, the Company shall give notice of redemption to the holders of the
then outstanding Rights by publication of a notice in any newspaper distributed nationally in Canada and in the
United States or by mailing such notice to each such holder at its last address as it appears upon the registry books
of the Rights Agent or, prior to the Separation Time, on the registry books of the transfer agent for the Voting Shares.
Any notice which is mailed in the manner provided herein shall be deemed given, whether or not the holder receives
the notice. Each notice of redemption will state the method by which the payment of the Redemption Price
38
Exhibit 4.1
will be made. If the Redemption Price payable to any holder of Rights includes a fraction of a cent, such Redemption
Price shall be rounded (up or down) to the nearest cent.
(g)
Upon the Rights being redeemed pursuant to Subsection 5.1(d), the Board of Directors shall be deemed to have
distributed new Rights to the holders of Voting Shares as of such date and in respect of each additional Voting Share
issued thereafter, on the same basis as Rights were first distributed hereunder and thereafter all the provisions of
this Agreement shall continue to apply to such redistributed Rights as if the Separation Time referred to in
Section 5.1(d) had not occurred and which for all purposes of this Agreement shall be deemed not to have occurred
and the new Rights shall be outstanding and attached to the outstanding Common Shares as of and after such date,
subject to and in accordance with the provisions of this Agreement.
(h)
The Board of Directors may waive the application of Section 3.1 in respect of the occurrence of any Flip-in Event if
the Board of Directors has determined within ten Trading Days following a Stock Acquisition Date that a Person
became an Acquiring Person by inadvertence and without any intention to become, or knowledge that it would
become, an Acquiring Person under this Agreement and, in the event that such a waiver is granted by the Board of
Directors, such Stock Acquisition Date shall be deemed not to have occurred. Any such waiver pursuant to this
Subsection 5.1(h) must be on the condition that such Person, within 14 days after the foregoing determination by the
Board of Directors or such earlier or later date as the Board of Directors may determine (the ‘Disposition Date’),
has reduced its Beneficial Ownership of Voting Shares so that the Person is no longer an Acquiring Person. If the
Person remains an Acquiring Person at the close of business on the Disposition Date, the Disposition Date shall be
deemed to be the date of occurrence of a further Stock Acquisition Date and Section 3.1 shall apply thereto.
(i)
The Company shall give prompt written notice to the Rights Agent of any waiver of the application of Section 3.1
made by the Board of Directors under this Section 5.1.
5.2
Expiration
No Person shall have any rights whatsoever pursuant to this Agreement or in respect of any Right after the
Expiration Time, except the Rights Agent as specified in Subsection 4.1(a) of this Agreement.
5.3
Issuance of New Rights Certificates
Notwithstanding any of the provisions of this Agreement or the Rights to the contrary, the Company may, at its
option, issue new Rights Certificates evidencing Rights in such form as may be approved by the Board of Directors to reflect any
adjustment or change in the number or kind or class of securities purchasable upon exercise of Rights made in accordance with the
provisions of this Agreement.
39
Exhibit 4.1
5.4
Supplements and Amendments
(a)
The Company may at any time, by resolution of the Board of Directors, supplement or make amendments to this
Agreement to correct any clerical or typographical error or, subject to Subsection 5.4(e), which supplements or
amendments are required to maintain the validity of this Agreement as a result of any change in any applicable
legislation, rules or regulations thereunder or policies of securities regulatory authorities or stock exchanges. The
Company may, by resolution of the Board of Directors, prior to the date of its shareholders’ meeting referred to in
Section 5.15, supplement or amend this Agreement without the approval of any holders of Rights or Voting Shares
(whether or not such action would adversely affect the interest of the holders of Rights or Voting Shares generally) in
order to make any changes which the Board of Directors acting in good faith may deem necessary or desirable.
Notwithstanding anything in this Section 5.4 to the contrary, no such supplement or amendment shall be made to the
provisions of Article 4 except with the written concurrence of the Rights Agent to such supplement or amendment.
(a)
Subject to Subsection 5.4(a), the Company may, with the prior consent of the holders of Voting Shares obtained as
set forth below, at any time prior to the Separation Time, amend, vary or rescind any of the provisions of this
Agreement and the Rights (whether or not such action would adversely affect the interests of the holders of Rights or
Voting Shares generally). Such consent shall be deemed to have been given if the action requiring such approval is
authorized by the affirmative vote of a majority of the votes cast by Independent Shareholders present or
represented at and entitled to be voted at a meeting of the holders of Voting Shares duly called and held in
compliance with applicable laws and the Articles and By-laws of the Company.
(b)
The Company may, with the prior consent of the holders of Rights, at any time on or after the Separation Time and
before the Expiration Time, amend, vary or delete any of the provisions of this Agreement and the Rights (whether or
not such action would materially adversely affect the interests of the holders of Rights generally), provided that no
such amendment, variation or deletion shall be made to the provisions of Article 4 except with the written
concurrence of the Rights Agent thereto. Such consent shall be deemed to have been given if such amendment,
variation or deletion is authorized by the affirmative votes of a simple majority of the votes cast by the holders of
Rights (other than holders of Rights whose Rights have become null and void pursuant to the provisions hereof)
present or represented at and entitled to be voted at a meeting of the holders of Rights duly called and held in
compliance with applicable laws and the Articles and By-laws of the Company.
(c)
For the purposes hereof, each outstanding Right (other than Rights which are void pursuant to the provisions hereof)
shall be entitled to one vote, and the procedures for the calling, holding and conduct of the meeting shall be those,
as nearly as may be, which are provided in the Company’s Articles or By-laws and the Business Corporations Act
(Ontario) with respect to meetings of shareholders of the Company.
40
Exhibit 4.1
(d)
Any amendments made by the Company to this Agreement pursuant to Subsection 5.4(a) which are required to
maintain the validity of this Agreement as a result of any change in any applicable legislation, rule or regulation
thereunder or policies of securities regulatory authorities or stock exchanges shall:
(i)
if made before the Separation Time, be submitted to the shareholders of the Company at the next meeting of
shareholders and the shareholders may, by the majority referred to in Subsection 5.4(b), confirm or reject
such amendment;
(ii)
if made after the Separation Time, be submitted to the holders of Rights at a meeting to be called for on a
date not later than immediately following the next meeting of shareholders of the Company called after the
Separation Time and the holders of Rights may, by resolution passed by the majority referred to in
Subsection 5.4(d), confirm or reject such amendment.
Any such amendment shall be effective from the date of the resolution of the Board of Directors adopting such
amendment, until it is confirmed or rejected or until it ceases to be effective (as described in the next sentence) and,
where such amendment is confirmed, it continues in effect in the form so confirmed. If such amendment is rejected
by the shareholders or the holders of Rights or is not submitted to the shareholders or holders of Rights as required,
then such amendment shall cease to be effective from and after the termination of the meeting at which it was
rejected or to which it should have been but was not submitted or from and after the date of the meeting of holders of
Rights that should have been but was not held, and no subsequent resolution of the Board of Directors to amend this
Agreement to substantially the same effect shall be effective until confirmed by the shareholders or holders of
Rights, as the case may be.
(b)
The Company shall be required to provide the Rights Agent with notice in writing of any such amendment, variation
or deletion to this Agreement as referred to in this Section 5.4 within five Business Days of effecting such
amendment, variation or deletion, provided that failure to give such notice, or any defect therein, shall not affect the
validity of any such amendment, variation or deletion.
5.5
Fractional Rights and Fractional Shares
(a)
The Company shall not be required to issue fractions of Rights or to distribute Rights Certificates which evidence
fractional Rights. After the Separation Time, in lieu of issuing fractional Rights, the Company shall pay to the holders
of record of the Rights Certificates (provided the Rights represented by such Rights Certificates are not void
pursuant to the provisions of Subsection 3.1(b), at the time such fractional Rights would otherwise be issuable), an
amount in cash equal to the fraction of the Market Price of one whole Right that the fraction of a Right that would
otherwise be issuable is of one whole Right, provided that the Company shall not be required or obligated to make
any payment provided for
41
Exhibit 4.1
above unless the amount payable by the Company to a certain holder exceeds $10.
(b)
The Company shall not be required to issue fractions of Common Shares upon exercise of Rights or to distribute
certificates which evidence fractional Common Shares. In lieu of issuing fractional Common Shares, the Company
shall pay to the registered holders of Rights Certificates, at the time such Rights are exercised as herein provided,
an amount in cash equal to the fraction of the Market Price of one Common Share that the fraction of a Common
Share that would otherwise be issuable upon the exercise of such Right is of one whole Common Share at the date
of such exercise.
5.6
Rights of Action
Subject to the terms of this Agreement, all rights of action in respect of this Agreement, other than rights of action
vested solely in the Rights Agent, are vested in the respective holders of the Rights. Any holder of Rights, without the consent of the
Rights Agent or of the holder of any other Rights, may, on such holder’s own behalf and for such holder’s own benefit and the
benefit of other holders of Rights, enforce, and may institute and maintain any suit, action or proceeding against the Company to
enforce such holder’s right to exercise such holder’s Rights, or Rights to which such holder is entitled, in the manner provided in
such holder’s Rights Certificate and in this Agreement. Without limiting the foregoing or any remedies available to the holders of
Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach of this
Agreement and will be entitled to specific performance of the obligations under, and injunctive relief against actual or threatened
violations of the obligations of any Person subject to, this Agreement.
5.7
Regulatory Approvals
Any obligation of the Company or action or event contemplated by this Agreement shall be subject to the receipt of
requisite approval or consent from any governmental or regulatory authority having jurisdiction, and without limiting the generality of
the foregoing, while any securities of the Company are listed and admitted to trading thereon, necessary approvals of the Toronto
Stock Exchange, the New York Stock Exchange and other exchanges shall be obtained, in relation to the issuance of the Rights
and the Common Shares upon the exercise of Rights under Subsection 2.2(d).
5.8
Non-Canadian Holders
If in the opinion of the Board of Directors (who may rely upon the advice of counsel) any action or event
contemplated by this Agreement would require compliance by the Company with the securities laws or comparable legislation of a
jurisdiction outside Canada or the United States, the Board of Directors acting in good faith shall take such actions as it may
consider appropriate to ensure such compliance or avoid the application thereof. In no event shall the Company or the Rights Agent
be required to issue or deliver Rights or securities issuable on exercise of Rights to persons who are citizens, residents or nationals
of any
42
Exhibit 4.1
jurisdiction other than Canada or the United States of America, in which such issue or delivery would be unlawful without
registration of the relevant Persons or securities for such purposes.
5.9
Notices
(a)
Notices or demands authorized or required by this Agreement to be given or made by the Rights Agent or by the
holder of any Rights to or on the Company shall be sufficiently given or made if delivered, sent by registered or
certified mail, postage prepaid (until another address is filed in writing with the Rights Agent), or sent by facsimile or
other form of recorded electronic communication, charges prepaid and confirmed in writing, as follows:
RB Global, Inc.
9500 Glenlyon Parkway
Burnaby, BC, Canada
V5J 0C6
Attention: Corporate Secretary
Fax No. (778) 331-5501
(b)
Notices or demands authorized or required by this Agreement to be given or made by the Company or by the holder
of any Rights to or on the Rights Agent shall be sufficiently given or made if delivered, sent by registered or certified
mail, postage prepaid (until another address is filed in writing with the Company), or sent by facsimile or other form
of recorded electronic communication, charges prepaid and confirmed in writing, as follows:
Computershare Investor Services Inc.
3 Floor – 510 Burrard Street
Vancouver, British Columbia V6C 3B9
Attention: General Manager, Client Services
Fax No.: (604) 661-9401
(c)
Except as otherwise provided hereunder, notices or demands authorized or required by this Agreement to be given
or made by the Company or the Rights Agent to or on the holder of any Rights shall be sufficiently given or made if
delivered or sent by first class mail, postage prepaid, addressed to such holder at the address of such holder as it
appears upon the register of the Rights Agent or, prior to the Separation Time, on the register of the Company for its
Common Shares. Any notice which is mailed or sent in the manner herein provided shall be deemed given, whether
or not the holder receives the notice.
(d)
Any notice given or made in accordance with this Section 5.9 shall be deemed to have been given and to have been
received on the day of delivery, if so delivered, on the third Business Day (excluding each day during which there
exists any general interruption of postal service due to strike, lockout or other cause) following the mailing thereof, if
so mailed, and on the day of telecopying
rd
43
Exhibit 4.1
or sending of the same by other means of recorded electronic communication (provided such sending is during the
normal business hours of the addressee on a Business Day and if not, on the first Business Day thereafter). Each of
the Company and the Rights Agent may from time to time change its address for notice by notice to the other given
in the manner aforesaid.
5.10
Costs of Enforcement
The Company agrees that if the Company fails to fulfil any of its obligations pursuant to this Agreement, then the
Company will reimburse the holder of any Rights for the costs and expenses (including legal fees) reasonably incurred by such
holder to enforce his rights pursuant to any Rights or this Agreement.
5.11
Successors
All the covenants and provisions of this Agreement by or for the benefit of the Company or the Rights Agent shall
bind and enure to the benefit of their respective successors and assigns hereunder.
5.12
Benefits of this Agreement
Nothing in this Agreement shall be construed to give to any Person other than the Company, the Rights Agent and
the holders of the Rights any legal or equitable right, remedy or claim under this Agreement; further, this Agreement shall be for the
sole and exclusive benefit of the Company, the Rights Agent and the holders of the Rights.
5.13
Governing Law
This Agreement and each Right issued hereunder shall be deemed to be a contract made under the laws of the
Province of British Columbia and for all purposes shall be governed by and construed in accordance with the laws of such Province
applicable to contracts to be made and performed entirely within such Province.
5.14
Severability
If any term or provision hereof or the application thereof to any circumstance shall, in any jurisdiction and to any
extent, be invalid or unenforceable, such term or provision shall be ineffective only as to such jurisdiction and to the extent of such
invalidity or unenforceability in such jurisdiction without invalidating or rendering unenforceable or ineffective the remaining terms
and provisions hereof in such jurisdiction or the application of such term or provision in any other jurisdiction or to circumstances
other than those as to which it is specifically held invalid or unenforceable.
44
Exhibit 4.1
5.15
Effective Date and Confirmation
This Agreement is effective and in full force and effect in accordance with its terms from and after the date hereof. At
the first annual or special meeting of holders of Voting Shares following the date hereof, the Company shall request confirmation of
this Agreement by the holders of its Voting Shares. If this Agreement is not confirmed by resolution passed by a majority of the
votes cast by holders of Voting Shares of the Company who vote in respect of confirmation of this Agreement at a meeting of the
Company’s shareholders to be held not later than six months from February 24, 2025, then this Agreement and all outstanding
Rights shall terminate and be void and of no further force and effect on and from that date which is the earlier of (a) the date of
termination of the meeting called to consider the confirmation of this Agreement under this Section 5.15 and (b) six months from
February 24, 2025.
5.16
Reconfirmation
This Agreement must be reconfirmed by a resolution passed by a majority of the votes cast by all holders of Voting
Shares who vote in respect of such reconfirmation at the annual meeting of the Company held in 2028 and at every third annual
meeting of the Company thereafter at which this Agreement has been reconfirmed pursuant to this Section 5.16. If the Agreement is
not so reconfirmed or is not presented for reconfirmation at any such annual meeting, the Agreement and all outstanding Rights
shall terminate and be void and of no further force and effect on and from the date of termination of any such annual meeting;
provided, however, that termination shall not occur if a Flip-in Event has occurred (other than a Flip-in Event which has been
waived pursuant to Subsection 5.1(a) or 5.1(h) hereof), prior to the date upon which this Agreement would otherwise terminate
pursuant to this Section 5.16.
5.17
Determinations and Actions by the Board of Directors
All actions, calculations and determinations (including all omissions with respect to the foregoing) which are done or
made by the Board of Directors, in good faith, for the purposes hereof shall not subject the Board of Directors or any director of the
Company to any liability to the holders of the Rights.
5.18
Force Majeure
No party shall be liable to the other, or held in breach of this Agreement, if prevented, hindered, or delayed in the
performance or observance of any provision contained herein by reason of act of God, riots, terrorism, acts of war, epidemics,
governmental action or judicial order, earthquakes, or any other similar causes (including, but not limited to, mechanical, electronic
or communication interruptions, disruptions or failures). Performance times under this Agreement shall be extended for a period of
time equivalent to the time lost because of any delay that is excusable under this Section 5.18.
5.19
Time of the Essence
Time shall be of the essence in this Agreement.
45
Exhibit 4.1
5.20
Execution in Counterparts
This Agreement may be executed in any number of counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall together constitute one and the same instrument.
[Remainder of page left intentionally blank]
46
Exhibit 4.1
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first
above written.
RB GLOBAL, INC.
By:
/s/ Darren Watt
c/s
COMPUTERSHARE INVESTOR SERVICES
INC.
By:
/s/ Praveena Naidu
By:
/s/ Mita Garcia
c/s
47
Exhibit 4.1
ATTACHMENT 1
RB GLOBAL, INC.
SECOND AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN AGREEMENT
[Form of Rights Certificate]
Certificate No. _______
_________ Rights
THE RIGHTS ARE SUBJECT TO TERMINATION ON THE TERMS SET FORTH IN THE SECOND AMENDED AND RESTATED
SHAREHOLDER RIGHTS PLAN AGREEMENT. UNDER CERTAIN CIRCUMSTANCES (SPECIFIED IN SUBSECTION 3.1(b) OF
THE SECOND AMENDED AND RESTATED SHAREHOLDER RIGHTS PLAN AGREEMENT), RIGHTS BENEFICIALLY OWNED
BY AN ACQUIRING PERSON OR CERTAIN RELATED PARTIES, OR TRANSFEREES OF AN ACQUIRING PERSON OR
CERTAIN RELATED PARTIES AND THEIR TRANSFEREES, MAY BECOME VOID WITHOUT FURTHER ACTION.
Rights Certificate
This certifies that , or registered assigns, is the registered holder of the number of Rights set forth above, each of
which entitles the registered holder thereof, subject to the terms, provisions and conditions of the Second Amended and Restated
Shareholder Rights Plan Agreement, dated as of February 24, 2025 (the ‘Second Amended and Restated Shareholder Rights Plan
Agreement’), between RB Global, Inc., a corporation duly incorporated under the Business Corporations Act (Ontario) (the
‘Company’) and Computershare Investor Services Inc., a trust company incorporated under the laws of Canada (the ‘Rights
Agent’), which amends and restates the Amended and Restated Shareholder Rights Plan Agreement dated February 28, 2019 (the
‘Original Agreement’), to purchase from the Company at any time after the Separation Time (as such term is defined in the Second
Amended and Restated Shareholder Rights Plan Agreement) and prior to the Expiration Time (as such term is defined in the
Second Amended and Restated Shareholder Rights Plan Agreement), one fully paid common share of the Company (a ‘Common
Share’) at the Exercise Price referred to below, upon presentation and surrender of this Rights Certificate with the Form of Election
to Exercise (in the form provided hereinafter) duly executed and submitted to the Rights Agent at its principal office in any of the
cities of Toronto, Montreal, Calgary and Vancouver, Canada. Until adjustment thereof in certain events as provided in the Second
Amended and Restated Shareholder Rights Plan Agreement, the Exercise Price shall be an amount equal to three times the Market
Price (as such term is defined in the Second Amended and Restated Shareholder Rights Plan Agreement) per Common Share
determined as at the Separation Time and shall be subject to adjustment in certain events as provided in the Second Amended and
Restated Shareholder Rights Plan Agreement.
In certain circumstances described in the Second Amended and Restated Shareholder Rights Plan Agreement, the
number of Common Shares which each Right entitles the registered holder thereof to purchase shall be adjusted as provided in the
Second Amended and Restated Shareholder Rights Plan Agreement.
48
Exhibit 4.1
This Rights Certificate is subject to all of the terms and provisions of the Second Amended and Restated
Shareholder Rights Plan Agreement, which terms and provisions are incorporated herein by reference and made a part hereof and
to which reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Rights Agent, the Company and the holders of the Rights. Copies of the Second Amended and Restated
Shareholder Rights Plan Agreement are on file at the registered office of the Company.
This Rights Certificate, with or without other Rights Certificates, upon surrender at any of the offices of the Rights
Agent designated for such purpose, may be exchanged for another Rights Certificate or Rights Certificates of like tenor and date
evidencing an aggregate number of Rights equal to the aggregate number of Rights evidenced by the Rights Certificate or Rights
Certificates surrendered. If this Rights Certificate shall be exercised in part, the registered holder shall be entitled to receive, upon
surrender hereof, another Rights Certificate or Rights Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Second Amended and Restated Shareholder Rights Plan Agreement, the Rights
evidenced by this Certificate may be redeemed by the Company at a redemption price of $0.000001 per Right, subject to
adjustment in certain events, under certain circumstances at its option.
No fractional Common Shares will be issued upon the exercise of any Rights evidenced hereby, but in lieu thereof a
cash payment will be made, as provided in the Second Amended and Restated Shareholder Rights Plan Agreement.
No holder of this Rights Certificate, as such, shall be entitled to vote or receive dividends or be deemed for any
purpose the holder of Common Shares or of any other securities which may at any time be issuable upon the exercise hereof, nor
shall anything contained in the Second Amended and Restated Shareholder Rights Plan Agreement or herein be construed to
confer upon the holder hereof, as such, any of the Rights of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate
action, or to receive notice of meetings or other actions affecting shareholders (except as provided in the Second Amended and
Restated Shareholder Rights Plan Agreement), or to receive dividends or subscription rights, or otherwise, until the Rights
evidenced by this Rights Certificate shall have been exercised as provided in the Second Amended and Restated Shareholder
Rights Plan Agreement.
This Rights Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by the
Rights Agent.
49
Exhibit 4.1
WITNESS the facsimile signature of the proper officers of the Company and its corporate seal.
Date:
RB GLOBAL, INC.
By:
By:
Countersigned:
COMPUTERSHARE INVESTOR SERVICES INC.
By:
Authorized Signature
50
Exhibit 4.1
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer the Rights evidenced by this Rights Certificate.)
FOR VALUE RECEIVED hereby sells, assigns and
transfers unto _________________________________________________________________
________________________________________________________
(Please print name and address of transferee.)
the Rights represented by this Rights Certificate, together with all right, title and interest therein, and does hereby irrevocably
constitute and appoint , as attorney, to transfer the within Rights on the books of the Company, with full power of substitution.
Dated: ___________________________________________________
Signature Guaranteed:
Signature
(Signature must correspond to name as written upon the face of
this Rights Certificate in every particular, without alteration or
enlargement or any change whatsoever.)
Signature must be guaranteed by a Canadian chartered bank, a Canadian trust company, a member of a recognized stock
exchange or a member of the Securities Transfer Association Medallion (STAMP) Program.
CERTIFICATE
(To be completed if true.)
The undersigned party transferring Rights hereunder, hereby represents, for the benefit of all holders of Rights and
Common Shares, that the Rights evidenced by this Rights Certificate are not, and, to the knowledge of the undersigned, have
never been, Beneficially Owned by an Acquiring Person or an Affiliate or Associate thereof or a Person acting jointly or in concert
with an Acquiring Person or an Affiliate or Associate thereof. Capitalized terms shall have the meaning ascribed thereto in the
Second Amended and Restated Shareholder Rights Plan Agreement of RB Global, Inc.
Signature
(To be attached to each Rights Certificate)
51
Exhibit 4.1
FORM OF ELECTION TO EXERCISE
(To be executed by the registered holder if such holder desires to exercise the Rights Certificate.)
TO: RB GLOBAL, INC.
AND TO: COMPUTERSHARE INVESTOR SERVICES INC.
The undersigned hereby irrevocably elects to exercise whole Rights represented by the attached Rights Certificate
to purchase the Common Shares or other securities, if applicable, issuable upon the exercise of such Rights and requests that
certificates for such securities be issued in the name of:
(Name)
(Address)
(City, Province and Postal Code)
(Social Insurance Number or other taxpayer identification number)
If such number of Rights shall not be all the Rights evidenced by this Rights Certificate, a new Rights Certificate for the balance of
such Rights shall be registered in the name of and delivered to:
(Name)
(Address)
(City, Province and Postal Code)
(Social Insurance Number or other taxpayer identification number)
Dated:
Signature Guaranteed:
Signature
(Signature must correspond to name as written upon the face of
this Rights Certificate in every particular, without alteration or
enlargement or any change whatsoever.)
Signature must be guaranteed by a Canadian chartered bank, a Canadian trust company, a member of a recognized stock
exchange or a member of the Securities Transfer Association Medallion (STAMP) Program.
52
Exhibit 4.1
CERTIFICATE
(To be completed if true.)
The undersigned party exercising Rights hereunder, hereby represents, for the benefit of all holders of Rights and Common Shares,
that the Rights evidenced by this Rights Certificate are not, and, to the knowledge of the undersigned, have never been,
Beneficially Owned by an Acquiring Person or an Affiliate or Associate thereof or a Person acting jointly or in concert with an
Acquiring Person or an Affiliate or Associate thereof. Capitalized terms shall have the meaning ascribed thereto in the Second
Amended and Restated Shareholder Rights Plan Agreement of RB Global, Inc.
Signature
(To be attached to each Rights Certificate)
NOTICE
In the event the certification set forth above in the Form of Assignment and Form of Election to Exercise, as applicable, is not
completed, the Company will deem the Beneficial Owner of the Rights evidenced by this Rights Certificate to be an Acquiring
Person or an Affiliate or Associate thereof. No Rights Certificates shall be issued in exchange for a Rights Certificate owned or
deemed to have been owned by an Acquiring Person or an Affiliate or Associate thereof, or by a Person acting jointly or in concert
with an Acquiring Person or an Affiliate or Associate thereof.
53
Exhibit 10.46
RB GLOBAL, INC.
AMENDED AND RESTATED 2023 SHARE INCENTIVE PLAN
SECTION 1. GENERAL PURPOSE OF THE PLAN; DEFINITIONS
The name of the plan is the RB Global, Inc. Amended and Restated 2023 Share Incentive Plan, as amended and restated on
January 1, 2025 and as amended from time to time (the “Plan”). The purpose of the Plan is to encourage and enable the officers,
employees, Non-Employee Directors and Consultants of RB Global, Inc. (formerly Ritchie Bros. Auctioneers Incorporated) (the
“Company”) and its Affiliates upon whose judgment, initiative and efforts the Company largely depends for the successful conduct
of its business to acquire a proprietary interest in the Company. It is anticipated that providing such persons with a direct stake in the
Company’s welfare will assure a closer identification of their interests with those of the Company and its shareholders, thereby
stimulating their efforts on the Company’s behalf and strengthening their desire to remain with the Company and/or its Affiliates.
The following terms shall be defined as set forth below:
“Act” means the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder.
“Administrator” means either the Board or the compensation committee of the Board or a similar committee performing the
functions of the compensation committee and which is comprised of not less than two Non-Employee Directors who are
independent.
“Affiliate” means, at the time of determination, any “parent” or “subsidiary” of the Company as such terms are defined in
Rule 405 of the Act. The Board will have the authority to determine the time or times at which “parent” or “subsidiary” status is
determined within the foregoing definition.
“Award” or “Awards,” except where referring to a particular category of grant under the Plan, shall include Incentive Stock
Options, Non-Qualified Stock Options, Share Appreciation Rights, Restricted Share Units, Restricted Share Awards, Unrestricted
Share Awards, Cash-Based Awards, and Dividend Equivalent Rights.
“Award Certificate” means a written or electronic document setting forth the terms and provisions applicable to an Award
granted under the Plan. Each Award Certificate is subject to the terms and conditions of the Plan.
“Board” means the Board of Directors of the Company.
“Cash-Based Award” means an Award entitling the recipient to receive a cash-denominated payment.
“Code” means the U.S. Internal Revenue Code of 1986, as amended, and any successor Code, and related rules, regulations
and interpretations.
ACTIVE/119909774.14
Exhibit 10.46
“Consultant” means a person, other than an employee, executive officer, or director of the Company or of a related entity of
the Company, that (i) is engaged to provide services to the Company or a related entity of the Company, other than services provided
in relation to a distribution, (ii) provides the services under a written contract with the Company or a related entity of the Company,
and (iii) spends or will spend a significant amount of time and attention on the affairs and business of the Company or a related
entity of the Company; provided, that a Consultant shall only include a person who qualifies as a consultant or advisor under
Instruction A.1.(a)(1) of Form S-8 under the Act.
“Dividend Equivalent Right” means an Award entitling the grantee to receive credits based on cash dividends that would
have been paid on the Shares specified in the Dividend Equivalent Right (or other award to which it relates) if such Shares had been
issued to and held by the grantee.
“Effective Date” means the date on which the Plan becomes effective as set forth in Section 19.
“Exchange” means The New York Stock Exchange or such other exchange upon which the Company may be listed, should
it no longer be listed on the New York Stock Exchange.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
“Fair Market Value” of the Shares on any given date means the closing price of the Common Shares on the last trading day
prior to such date on The New York Stock Exchange or the Toronto Stock Exchange, whichever exchange has the majority of the
trading volume at such time. If there is no closing price for such date, the determination shall be made by reference to the last date
preceding such date for which there is a closing price.
“Incentive Stock Option” means any Stock Option designated and qualified as an “incentive stock option” as defined in
Section 422 of the Code.
“Insider” has the same meaning as found in the TSX Company Manual.
“Minimum Vesting Period” means the one-year period following the date of grant of an Award.
“Non-Employee Director” means a member of the Board who is not also an employee of the Company or any Affiliate.
“Non-Qualified Stock Option” means any Stock Option that is not an Incentive Stock Option.
“Option” or “Stock Option” means any option to purchase Shares granted pursuant to Section 5.
2
ACTIVE/119909774.14
Exhibit 10.46
“Restricted Shares” means the Shares underlying a Restricted Share Award that remain subject to a risk of forfeiture or the
Company’s right of repurchase.
“Restricted Share Award” means an Award of Restricted Shares subject to such restrictions and conditions as the
Administrator may determine at the time of grant.
“Restricted Share Units” means an Award of share units subject to such restrictions and conditions as the Administrator may
determine at the time of grant.
“Sale Event” means (i) the sale of all or substantially all of the assets of the Company on a consolidated basis to an unrelated
person or entity, (ii) a merger, reorganization or consolidation pursuant to which the holders of the Company’s outstanding voting
power and outstanding stock immediately prior to such transaction do not own a majority of the outstanding voting power and
outstanding stock or other equity interests of the resulting or successor entity (or its ultimate parent, if applicable) immediately upon
completion of such transaction, (iii) the sale of all of the Shares of the Company to an unrelated person, entity or group thereof
acting in concert, or (iv) any other transaction in which the owners of the Company’s outstanding voting power immediately prior to
such transaction do not own at least a majority of the outstanding voting power of the Company or any successor entity immediately
upon completion of the transaction other than as a result of the acquisition of securities directly from the Company.
“Sale Price” means the value as determined by the Administrator of the consideration payable, or otherwise to be received by
shareholders, per share of Stock pursuant to a Sale Event.
“Section 409A” means Section 409A of the Code and the regulations and other guidance promulgated thereunder.
“Service Relationship” means any relationship as an officer, employee, director or Consultant of the Company or any
Affiliate (e.g., a Service Relationship shall be deemed to continue without interruption in the event an individual’s status changes
from full-time employee to part-time employee or Consultant).
“Shares” means the common shares in the capital of the Company, subject to adjustments pursuant to Section 3.
“Share Appreciation Right” means an Award entitling the recipient to receive Shares (or cash, to the extent explicitly
provided for in the applicable Award Certificate) having a value equal to the excess of the Fair Market Value of the Shares on the
date of exercise over the exercise price of the Share Appreciation Right multiplied by the number of Shares with respect to which the
Share Appreciation Right is exercised.
“Subsidiary” means any corporation or other entity (other than the Company) in which the Company has at least a 50
percent interest, either directly or indirectly.
“Substitute Awards” means Awards granted or Shares issued by the Company in assumption of, or in substitution or
exchange for, awards previously granted, in each case by a
3
ACTIVE/119909774.14
Exhibit 10.46
company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines.
“Ten Percent Owner” means an employee who owns or is deemed to own (by reason of the attribution rules of Section
424(d) of the Code) more than 10 percent of the combined voting power of all classes of shares of the Company or any parent or
subsidiary corporation.
“Unrestricted Share Award” means an Award of Shares free of any restrictions.
SECTION 2. ADMINISTRATION OF PLAN; ADMINISTRATOR AUTHORITY TO SELECT GRANTEES AND
DETERMINE AWARDS
(a)
Administration of Plan. The Plan shall be administered by the Administrator.
(b)
Powers of Administrator. The Administrator shall have the power and authority to grant Awards consistent with the
terms of the Plan, including the power and authority:
(i)
to select the individuals to whom Awards may from time to time be granted;
(ii)
to determine the time or times of grant, and the extent, if any, of Incentive Stock Options, Non-Qualified
Stock Options, Share Appreciation Rights, Restricted Share Awards, Restricted Share Units, Unrestricted Share Awards, Cash-Based
Awards, and Dividend Equivalent Rights, or any combination of the foregoing, granted to any one or more grantees;
(iii)
to determine the number of Shares to be covered by any Award;
(iv)
to determine and modify from time to time the terms and conditions, including restrictions, not inconsistent
with the terms of the Plan, of any Award, which terms and conditions may differ among individual Awards and grantees, and to
approve the forms of Award Certificates;
(v)
to accelerate at any time the exercisability or vesting of all or any portion of any Award;
(vi)
subject to the provisions of Section 5(c) or 6(d), as applicable, to extend at any time the period in which Stock
Options and Share Appreciation Rights may be exercised; and
(vii)
at any time to adopt, alter and repeal such rules, guidelines and practices for administration of the Plan and for
its own acts and proceedings as it shall deem advisable;
(viii)
to interpret the terms and provisions of the Plan and any Award (including related written instruments);
(ix)
to make all determinations it deems advisable for the administration of the Plan; to decide all disputes arising
in connection with the Plan; and
(x)
to otherwise supervise the administration of the Plan.
All decisions and interpretations of the Administrator shall be binding on all persons, including the Company and Plan
grantees.
4
ACTIVE/119909774.14
Exhibit 10.46
(c)
Delegation of Authority to Grant Awards. Subject to applicable law, the Administrator, in its discretion, may delegate
to a committee consisting of one or more officers of the Company, including the Chief Executive Officer of the Company, all or part
of the Administrator’s authority and duties with respect to the granting of Awards to individuals who are (i) not subject to the
reporting and other provisions of Section 16 of the Exchange Act and (ii) not members of the delegated committee. Any such
delegation by the Administrator shall include a limitation as to the number of Shares underlying Awards that may be granted during
the period of the delegation and shall contain guidelines as to the determination of the exercise price and the vesting criteria. The
Administrator may revoke or amend the terms of a delegation at any time but such action shall not invalidate any prior actions of the
Administrator’s delegate or delegates that were consistent with the terms of the Plan.
(d)
Award Certificate. Other than with respect to Cash-Based Awards, Awards under the Plan shall be evidenced by
Award Certificates that set forth the terms, conditions and limitations for each Award, which may include, without limitation, the
term of an Award and the provisions applicable in the event employment or service terminates.
(e)
Indemnification. Neither the Board nor the Administrator, nor any member of either or any delegate thereof, shall be
liable for any act, omission, interpretation, construction, or determination made in good faith in connection with the Plan, and the
members of the Board and the Administrator (and any delegate thereof) shall be entitled in all cases to indemnification and
reimbursement by the Company in respect of any claim, loss, damage or expense (including, without limitation, reasonable
attorneys’ fees) arising or resulting therefrom to the fullest extent permitted by law and/or under the Company’s articles or bylaws or
any directors’ and officers’ liability insurance coverage which may be in effect from time to time and/or any indemnification
agreement between such individual and the Company.
(f)
Non-U.S. Award Recipients. Notwithstanding any provision of the Plan to the contrary, in order to comply with the
laws in other countries in which the Company and its Affiliates operate or have employees or other individuals eligible for Awards,
the Administrator, in its sole discretion, shall have the power and authority to: (i) determine which Subsidiaries are covered by the
Plan; (ii) determine which individuals outside the United States are eligible to participate in the Plan; (iii) modify the terms and
conditions of any Award granted to individuals outside the United States to comply with applicable foreign laws; (iv) establish
subplans and modify exercise procedures and other terms and procedures, to the extent the Administrator determines such actions to
be necessary or advisable (and such subplans and/or modifications shall be attached to this Plan as appendices); provided, however,
that no such subplans and/or modifications shall increase the share limitations contained in Section 3(a) hereof; and (v) take any
action, before or after an Award is made, that the Administrator determines to be necessary or advisable to obtain approval or comply
with any local governmental regulatory exemptions or approvals. Notwithstanding the foregoing, the Administrator may not take any
actions hereunder, and no Awards shall be granted, that would violate the Exchange Act or any other applicable United States
securities law, the Code, or any other applicable United States governing statute or law.
(g)
Minimum Vesting Period. The vesting period for each equity-based Award granted under the Plan must be at least
equal to the Minimum Vesting Period; provided, however, notwithstanding the foregoing, (i) up to five percent of the Shares
authorized for issuance under the Plan may be utilized for Unrestricted Share Awards or other Awards with a vesting period that is
less than the Minimum Vesting Period (each such Award, an “Excepted Award”) and (ii) annual Awards to Non-Employee Directors
that occur in connection with the Company’s annual meeting of shareholders may vest on the earlier of the one-year anniversary of
the date of grant or the date of the Company’s next annual meeting of shareholders which is at least 50 weeks after the immediately
preceding year’s annual meeting. Notwithstanding the
5
ACTIVE/119909774.14
Exhibit 10.46
foregoing, (x) in addition to Excepted Awards, the Administrator may grant Awards that vest (or permit previously granted Awards to
vest) within the Minimum Vesting Period (i) if such Awards are granted as substitute Awards in replacement of other Awards (or
awards previously granted by an entity being acquired (or assets of which are being acquired)) that were scheduled to vest within the
Minimum Vesting Period or (ii) if such Awards are being granted in lieu of fully vested cash compensation and (y) nothing in this
Section 2(g) shall limit the Administrator’s authority to provide for the accelerated vesting of Awards in the terms of an Award
Certificate or as permitted in Section 2(b)(v) above.
SECTION 3. STOCK ISSUABLE UNDER THE PLAN; MERGERS; SUBSTITUTION
(a)
Stock Issuable. The maximum number of shares of Stock reserved and available for issuance under the Plan shall be
9,355,000 Shares, subject to adjustment as provided in this Section 3. For purposes of this limitation, the Shares underlying any
awards under the Plan that are forfeited, canceled or otherwise terminated (other than by exercise) shall be added back to the Shares
available for issuance under the Plan and, to the extent permitted under Section 422 of the Code and the regulations promulgated
thereunder, the Shares that may be issued as Incentive Stock Options. Notwithstanding the foregoing, the following Shares shall not
be added to the Shares authorized for grant under the Plan: (i) shares tendered or held back upon exercise of an Option or settlement
of an Award to cover the exercise price or tax withholding, and (ii) shares subject to a Share Appreciation Right that are not issued in
connection with the share settlement of the Share Appreciation Right upon exercise thereof. In the event the Company repurchases
Shares on the open market, such Shares shall not be added to the Shares available for issuance under the Plan. Subject to such
overall limitations, Shares may be issued up to such maximum number pursuant to any type or types of Award; provided, however,
that no more than 9,355,000 Shares may be issued in the form of Incentive Stock Options. The Shares available for issuance under
the Plan may be authorized but unissued Shares or Shares reacquired by the Company.
(b)
The maximum number of Shares that are issuable to Insiders, at any time, pursuant to Awards under the Plan and any
other share-based compensation arrangement adopted by the Company is 10% of the Shares outstanding from time to time. The
maximum number of Shares that may be issued to Insiders pursuant to Awards under the Plan and any other share-based
compensation arrangement adopted by the Company within a one-year period is 10% of the Shares outstanding from time to time.
(c)
Substitute Awards. Substitute Awards shall not reduce the Shares authorized for grant under the Plan, nor shall Shares
subject to a Substitute Award be added to the Shares available for Awards under the Plan as provided in Section 3(a) above.
Additionally, subject to the applicable securities laws and stock exchange rules, in the event that a company acquired by the
Company or any Affiliate or with which the Company or any Affiliate combines has shares available under a pre-existing plan
approved by shareholders and not adopted in contemplation of such acquisition or combination, the shares available for grant
pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or
valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common
stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the shares
authorized for grant under the Plan (and Shares subject to such Awards shall not be added to the shares available for Awards under
the Plan as provided in Section 3(a) above); provided that Awards using such available Shares shall not be made after the date
awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall
6
ACTIVE/119909774.14
Exhibit 10.46
only be made to individuals who were not employees or directors prior to such acquisition or combination.
(d)
Changes in Shares. Subject to Section 3(d) hereof, if, as a result of any reorganization, recapitalization,
reclassification, share dividend, share split, reverse share split or other similar change in the Company’s capital shares, the
outstanding Shares are increased or decreased or are exchanged for a different number or kind of shares or other securities of the
Company, or additional shares or new or different shares or other securities of the Company or other non-cash assets are distributed
with respect to such Shares or other securities, or, if, as a result of any merger or consolidation, sale of all or substantially all of the
assets of the Company, the outstanding Shares are converted into or exchanged for securities of the Company or any successor entity
(or a parent or subsidiary thereof), the Administrator shall make an appropriate or proportionate adjustment in (i) the maximum
number of Shares reserved for issuance under the Plan, including the maximum number of Shares that may be issued in the form of
Incentive Stock Options, (ii) the number and kind of Shares or other securities subject to any then outstanding Awards under the
Plan, (iii) the repurchase price, if any, per Share subject to each outstanding Restricted Share Award, and (iv) the exercise price for
each Share subject to any then outstanding Stock Options and Share Appreciation Rights under the Plan, without changing the
aggregate exercise price (i.e., the exercise price multiplied by the number of Shares subject to Stock Options and Share Appreciation
Rights) as to which such Stock Options and Share Appreciation Rights remain exercisable. The Administrator shall also make
equitable or proportionate adjustments in the number of Shares subject to outstanding Awards and the exercise price and the terms of
outstanding Awards to take into consideration cash dividends paid other than in the ordinary course or any other extraordinary
corporate event. The adjustment by the Administrator shall be final, binding and conclusive. No fractional Shares shall be issued
under the Plan resulting from any such adjustment, but the Administrator in its discretion may make a cash payment in lieu of
fractional Shares.
(e)
Mergers and Other Transactions. In the case of and subject to the consummation of a Sale Event, the parties thereto
may cause the assumption or continuation of Awards theretofore granted by the successor entity, or the substitution of such Awards
with new Awards of the successor entity or parent thereof, with appropriate adjustment as to the number and kind of shares and, if
appropriate, the per share exercise prices, as such parties shall agree. To the extent the parties to such Sale Event do not provide for
the assumption, continuation or substitution of Awards, upon the effective time of the Sale Event, the Plan and all outstanding
Awards granted hereunder shall terminate. In such case, except as may be otherwise provided in the relevant Award Certificate, all
Awards with time-based vesting conditions or restrictions that are not vested and/or exercisable immediately prior to the effective
time of the Sale Event shall become fully vested and exercisable as of immediately prior to the effective time of the Sale Event, and
all Awards with conditions and restrictions relating to the attainment of performance goals may become vested and nonforfeitable in
connection with a Sale Event in the Administrator’s discretion or to the extent specified in the relevant Award Certificate. In the
event of such termination, (i) the Company shall have the option (in its sole discretion) to make or provide for a payment, in cash or
in kind, to the grantees holding Options and Share Appreciation Rights, in exchange for the cancellation thereof, in an amount equal
to the difference between (A) the Sale Price multiplied by the number of Shares subject to outstanding Options and Share
Appreciation Rights (to the extent then exercisable at prices not in excess of the Sale Price) and (B) the aggregate exercise price of
all such outstanding Options and Share Appreciation Rights (provided that, in the case of an Option or Share Appreciation Right
with an exercise price equal to or greater than the Sale Price, such Option or Share Appreciation Right shall be cancelled for no
consideration); or (ii) each grantee shall be permitted, within a specified period of time prior to the consummation of the Sale Event
as determined by the Administrator, to exercise all outstanding Options and Share Appreciation Rights (to the extent then
exercisable) held by such grantee. The Company shall also have the option (in its sole discretion) to make or
7
ACTIVE/119909774.14
Exhibit 10.46
provide for a payment, in cash or in kind, to the grantees holding other Awards in an amount equal to the Sale Price multiplied by the
number of vested Shares under such Awards.
SECTION 4. ELIGIBILITY
Grantees under the Plan will be such officers, employees, Non-Employee Directors or Consultants of the Company and its
Affiliates as are selected from time to time by the Administrator in its sole discretion; provided that Awards may not be granted to
officers, employees, Non-Employee Directors or Consultants that are U.S. taxpayers and who are providing services only to any
“parent” of the Company, as such term is defined in Rule 405 of the Act, unless (i) the Shares underlying the Awards are treated as
“service recipient stock” under Section 409A or (ii) the Company has determined that such Awards are exempt from or otherwise
comply with Section 409A.
SECTION 5. STOCK OPTIONS
(a)
Award of Stock Options. The Administrator may grant Stock Options under the Plan. Any Stock Option granted under
the Plan shall be in such form as the Administrator may from time to time approve.
Stock Options granted under the Plan may be either Incentive Stock Options or Non-Qualified Stock Options. Incentive
Stock Options may be granted only to employees of the Company or any Subsidiary that is a “subsidiary corporation” within the
meaning of Section 424(f) of the Code. To the extent that any Option does not qualify as an Incentive Stock Option, it shall be
deemed a Non-Qualified Stock Option.
Stock Options granted pursuant to this Section 5 shall be subject to the following terms and conditions and shall contain such
additional terms and conditions, not inconsistent with the terms of the Plan, as the Administrator shall deem desirable. If the
Administrator so determines, Stock Options may be granted in lieu of cash compensation at the optionee’s election, subject to such
terms and conditions as the Administrator may establish.
(b)
Exercise Price. The exercise price per Share for any Stock Option granted pursuant to this Section 5 shall be
determined by the Administrator at the time of grant but shall not be less than 100 percent of the Fair Market Value on the date of
grant. In the case of an Incentive Stock Option that is granted to a Ten Percent Owner, the exercise price of such Incentive Stock
Option shall be not less than 110 percent of the Fair Market Value on the grant date. Notwithstanding the foregoing and subject to
the applicable securities laws and stock exchange rules, Stock Options may be granted with an exercise price per share that is less
than 100 percent of the Fair Market Value on the date of grant (i) pursuant to a transaction described in, and in a manner consistent
with, Section 424(a) of the Code, (ii) to individuals who are not subject to U.S. income tax on the date of grant, or (iii) if the Stock
Option is otherwise compliant with Section 409A.
(c)
Option Term. The term of each Stock Option shall be fixed by the Administrator, but no Stock Option shall be
exercisable more than ten years after the date the Stock Option is granted. In the case of an Incentive Stock Option that is granted to
a Ten Percent Owner, the term of such Stock Option shall be no more than five years from the date of grant.
8
ACTIVE/119909774.14
Exhibit 10.46
(d)
Exercisability; Rights of a Shareholder. Stock Options shall become exercisable at such time or times, whether or not
in installments, as shall be determined by the Administrator at or after the grant date. An optionee shall have the rights of a
shareholder only as to shares acquired upon the exercise of a Stock Option and not as to unexercised Stock Options.
(e)
Method of Exercise. Stock Options may be exercised in whole or in part, by giving written or electronic notice of
exercise to the Company, specifying the number of shares to be purchased. Payment of the purchase price may be made by one or
more of the following methods except to the extent otherwise provided in the Award Certificate:
(i)
In cash, by certified or bank check or other instrument acceptable to the Administrator;
(ii)
Through the delivery (or attestation to the ownership following such procedures as the Company may
prescribe) of Shares that are not then subject to restrictions under any Company plan. Such surrendered Shares shall be valued at
Fair Market Value on the exercise date;
(iii)
By the optionee delivering to the Company a properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company cash or a check payable and acceptable to the Company for the purchase
price; provided that in the event the optionee chooses to pay the purchase price as so provided, the optionee and the broker shall
comply with such procedures and enter into such agreements of indemnity and other agreements as the Company shall prescribe as a
condition of such payment procedure; or
(iv)
With respect to Stock Options that are not Incentive Stock Options, by a “net exercise” arrangement pursuant
to which the Company will reduce the number of Shares issuable upon exercise by the largest whole number of Shares with an
aggregate Fair Market Value that does not exceed the aggregate exercise price of the exercised Stock Options.
(v)
Payment instruments will be received subject to collection. The transfer to the optionee on the records of the
Company or of the transfer agent of the Shares to be purchased pursuant to the exercise of a Stock Option will be contingent upon
receipt from the optionee (or a purchaser acting in the optionee’s stead in accordance with the provisions of the Stock Option) by the
Company of the full purchase price for such Shares and the fulfillment of any other requirements contained in the Award Certificate
or applicable provisions of laws (including the satisfaction of any withholding taxes that the Company is obligated to withhold with
respect to the optionee). In the event an optionee chooses to pay the purchase price by previously-owned Shares through the
attestation method, the number of Shares transferred to the optionee upon the exercise of the Stock Option shall be net of the number
of attested Shares. In the event that the Company establishes, for itself or using the services of a third party, an automated system for
the exercise of Stock Options, such as a system using an internet website or interactive voice response, then the paperless exercise of
Stock Options may be permitted through the use of such an automated system.
(f)
Annual Limit on Incentive Stock Options. To the extent required for “incentive stock option” treatment under
Section 422 of the Code, the aggregate Fair Market Value (determined as of the time of grant) of the Shares with respect to which
Incentive Stock Options granted under this Plan and any other plan of the Company or its parent and subsidiary corporations become
exercisable for the first time by an optionee during any calendar year shall not exceed $100,000. To the extent that any Stock Option
exceeds this limit, it shall constitute a Non-Qualified Stock Option.
9
ACTIVE/119909774.14
Exhibit 10.46
SECTION 6. SHARE APPRECIATION RIGHTS
(a)
Award of Share Appreciation Rights. The Administrator may grant Share Appreciation Rights under the Plan. A Share
Appreciation Right is an Award entitling the recipient to receive Shares (or cash, to the extent explicitly provided for in the
applicable Award Certificate) having a value equal to the excess (if any) of: (A)(i) the Fair Market Value of a Share on the date of
exercise over (ii) the exercise price of the Share Appreciation Right, multiplied by (B) the number of Shares with respect to which
the Share Appreciation Right shall have been exercised.
(b)
Exercise Price of Share Appreciation Rights. The exercise price of a Share Appreciation Right shall not be less than
100 percent of the Fair Market Value of a Share on the date of grant. Notwithstanding the foregoing and subject to the applicable
securities laws and stock exchange rules, Share Appreciation Rights may be granted with an exercise price per share that is less than
100 percent of the Fair Market Value on the date of grant (i) pursuant to a transaction described in, and in a manner consistent with,
Section 424(a) of the Code, (ii) to individuals who are not subject to U.S. income tax on the date of grant or (iii) if the Share
Appreciation Right is otherwise compliant with Section 409A.
(c)
Grant and Exercise of Share Appreciation Rights. Share Appreciation Rights may be granted by the Administrator
independently of any Stock Option granted pursuant to Section 5 of the Plan.
(d)
Terms and Conditions of Share Appreciation Rights. Share Appreciation Rights shall be subject to such terms and
conditions as shall be determined on the date of grant by the Administrator. The term of a Share Appreciation Right may not exceed
ten years. The terms and conditions of each such Award shall be determined by the Administrator, and such terms and conditions
may differ among individual Awards and grantees.
SECTION 7. RESTRICTED SHARE AWARDS
(a)
Nature of Restricted Share Awards. The Administrator may grant Restricted Share Awards under the Plan. A
Restricted Share Award is any Award of Restricted Shares subject to such restrictions and conditions as the Administrator may
determine at the time of grant. Conditions may be based on continuing employment (or other Service Relationship) and/or
achievement of pre-established performance goals and objectives.
(b)
Rights as a Shareholder. Upon the grant of the Restricted Share Award and payment of a purchase price that complies
with the applicable securities laws and stock exchange rules, a grantee shall have the rights of a shareholder with respect to the
voting of the Restricted Shares and receipt of dividends; provided that any dividends paid by the Company during the vesting period
shall accrue and shall not be paid to the grantee until and only to the extent the Restricted Share Award vests. Unless the
Administrator shall otherwise determine, (i) uncertificated Restricted Shares shall be accompanied by a notation on the records of
the Company or the transfer agent to the effect that they are subject to forfeiture until such Restricted Shares are vested as provided
in Section 7(d) below, and (ii) certificated Restricted Shares shall remain in the possession of the Company until such Restricted
Shares are vested as provided in Section 7(d) below, and the grantee shall be required, as a condition of the grant, to deliver to the
Company such instruments of transfer as the Administrator may prescribe.
(c)
Restrictions. Restricted Shares may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed
of except as specifically provided herein or in the Restricted Share Award Certificate. Except as may otherwise be provided by the
Administrator either in the Award Certificate or, subject to Section 16 below, in writing after the Award is issued, if a
10
ACTIVE/119909774.14
Exhibit 10.46
grantee’s employment (or other Service Relationship) with the Company and its Affiliates terminates for any reason, any Restricted
Shares that have not vested at the time of termination shall automatically and without any requirement of notice to such grantee
from, or other action by or on behalf of, the Company be deemed to have been reacquired by the Company at its original purchase
price (if any) from such grantee or such grantee’s legal representative simultaneously with such termination of employment (or other
Service Relationship), and thereafter shall cease to represent any ownership of the Company by the grantee or rights of the grantee
as a shareholder. Following such deemed reacquisition of Restricted Shares that are represented by physical certificates, a grantee
shall surrender such certificates to the Company upon request without consideration.
(d)
Vesting of Restricted Shares. The Administrator at the time of grant shall specify the date or dates and/or the
attainment of pre-established performance goals, objectives and other conditions on which the non-transferability of the Restricted
Shares and the Company’s right of repurchase or forfeiture shall lapse. Subsequent to such date or dates and/or the attainment of
such pre-established performance goals, objectives and other conditions, the shares on which all restrictions have lapsed shall no
longer be Restricted Shares and shall be deemed “vested.”
SECTION 8. RESTRICTED SHARE UNITS
(a)
Nature of Restricted Stock Units. The Administrator may grant Restricted Share Units under the Plan. A Restricted
Share Unit is an Award of share units that may be settled in Shares (or cash, to the extent explicitly provided for in the Award
Certificate) upon the satisfaction of such restrictions and conditions as the Administrator may determine at the time of grant.
Conditions may be based on continuing employment (or other Service Relationship) and/or achievement of pre-established
performance goals and objectives. The terms and conditions of each such Award shall be determined by the Administrator, and such
terms and conditions may differ among individual Awards and grantees. Except in the case of Restricted Share Units with a deferred
settlement date that, for U.S. taxpayers, complies with Section 409A, at the end of the vesting period, the Restricted Share Units, to
the extent vested, shall be settled in the form of Shares. Restricted Share Units with deferred settlement dates granted to U.S.
taxpayers are subject to Section 409A and shall contain such additional terms and conditions as the Administrator shall determine in
its sole discretion in order to comply with the requirements of Section 409A.
(b)
Election to Receive Restricted Share Units in Lieu of Compensation. The Administrator may, in its sole discretion,
permit a grantee to elect to receive a portion of future cash compensation otherwise due to such grantee in the form of an award of
Restricted Share Units. Any such election shall be made in writing and shall be delivered to the Company no later than the date
specified by the Administrator and, for U.S. taxpayers, in accordance with Section 409A and such other rules and procedures
established by the Administrator. Any such future cash compensation that the grantee elects to defer shall be converted to a fixed
number of Restricted Share Units based on the Fair Market Value of the Shares on the date the compensation would otherwise have
been paid to the grantee if such payment had not been deferred as provided herein. The Administrator shall have the sole right to
determine whether and under what circumstances to permit such elections and to impose such limitations and other terms and
conditions thereon as the Administrator deems appropriate. Any Restricted Share Units that are elected to be received in lieu of cash
compensation shall be fully vested, unless otherwise provided in the Award Certificate.
(c)
Rights as a Shareholder. A grantee shall have the rights as a shareholder only as to Shares acquired by the grantee
upon settlement of Restricted Share Units; provided, however, that the grantee may be credited with Dividend Equivalent Rights
with respect to the share units
11
ACTIVE/119909774.14
Exhibit 10.46
underlying his or her Restricted Share Units, subject to the provisions of Section 11 and such terms and conditions as the
Administrator may determine.
(d)
Termination. Except as may otherwise be provided by the Administrator either in the Award Certificate or, subject to
Section 16 below, in writing after the Award is issued, a grantee’s right in all Restricted Share Units that have not vested shall
automatically terminate upon the grantee’s termination of employment (or cessation of Service Relationship) with the Company and
its Affiliates for any reason.
SECTION 9. UNRESTRICTED SHARE AWARDS
Grant or Sale of Unrestricted Shares. The Administrator may grant (or sell at such purchase price determined by the
Administrator) an Unrestricted Share Award under the Plan. An Unrestricted Share Award is an Award pursuant to which the grantee
may receive Shares free of any restrictions under the Plan. Unrestricted Share Awards may be granted in respect of past services or
other valid consideration, or in lieu of cash compensation due to such grantee.
SECTION 10.
CASH-BASED AWARDS
Grant of Cash-Based Awards. The Administrator may grant Cash-Based Awards under the Plan. A Cash-Based Award is an
Award that entitles the grantee to a payment in cash upon the attainment of specified performance goals. The Administrator shall
determine the maximum duration of the Cash-Based Award, the amount of cash to which the Cash-Based Award pertains, the
conditions upon which the Cash-Based Award shall become vested or payable, and such other provisions as the Administrator shall
determine. Each Cash-Based Award shall specify a cash-denominated payment amount, formula or payment ranges as determined by
the Administrator. Payment, if any, with respect to a Cash-Based Award shall be made in accordance with the terms of the Award and
may be made in cash.
SECTION 11.
DIVIDEND EQUIVALENT RIGHTS
(a)
Dividend Equivalent Rights. The Administrator may grant Dividend Equivalent Rights under the Plan. A Dividend
Equivalent Right is an Award entitling the grantee to receive credits based on cash dividends that would have been paid on the
Shares specified in the Dividend Equivalent Right (or other Award to which it relates) if such Shares had been issued to the grantee.
A Dividend Equivalent Right may be granted hereunder to any grantee as a component of an award of Restricted Stock Units or as a
freestanding award. The terms and conditions of Dividend Equivalent Rights shall be specified in the Award Certificate. Dividend
equivalents credited to the holder of a Dividend Equivalent Right may be paid currently or may be deemed to be reinvested in
additional Shares, which may thereafter accrue additional equivalents. Any such reinvestment shall be at Fair Market Value on the
date of reinvestment or such other price as may then apply under a dividend reinvestment plan sponsored by the Company, if any.
Dividend Equivalent Rights may be settled in cash or Shares or a combination thereof, in a single installment or installments. A
Dividend Equivalent Right granted as a component of an Award of Restricted Share Units shall provide that such Dividend
Equivalent Right shall be settled only upon settlement or payment of, or lapse of restrictions on, such other Award, and that such
Dividend Equivalent Right shall expire or be forfeited or annulled under the same conditions as such other Award.
(b)
Notwithstanding anything to the contrary in this Plan, no Options or Share Appreciation Rights shall provide for the payment
or accrual of Dividend Equivalent Rights.
12
ACTIVE/119909774.14
Exhibit 10.46
(c)
Termination. Except as may otherwise be provided by the Administrator either in the Award Certificate or, subject to
Section 16 below, in writing after the Award is issued, a grantee’s rights in all Dividend Equivalent Rights shall automatically
terminate upon the grantee’s termination of employment (or cessation of Service Relationship) with the Company and its Affiliates
for any reason.
SECTION 12.
TRANSFERABILITY OF AWARDS
(a)
Transferability. Except as provided in Section 12(b) below, during a grantee’s lifetime, the grantee’s Awards shall be
exercisable only by the grantee, or by the grantee’s legal representative or guardian in the event of the grantee’s incapacity. No
Awards shall be sold, assigned, transferred or otherwise encumbered or disposed of by a grantee other than by will or by the laws of
descent and distribution or pursuant to a domestic relations order. No Awards shall be subject, in whole or in part, to attachment,
execution, or levy of any kind, and any purported transfer in violation hereof shall be null and void.
(b)
Administrator Action. Notwithstanding Section 12(a), the Administrator, in its discretion, may provide either in the
Award Certificate regarding a given Award or by subsequent written approval that the grantee (who is an employee or director) may
transfer his or her Non-Qualified Stock Options to his or her immediate family members, to trusts for the benefit of such family
members, or to partnerships in which such family members are the only partners, provided that (i) such transfer complies with
applicable securities laws and stock exchange rules and (ii) the transferee agrees in writing with the Company to be bound by all of
the terms and conditions of this Plan and the applicable Award. In no event may an Award be transferred by a grantee for value.
(c)
Family Member. For purposes of Section 12(b), “family member” shall mean a grantee’s child, stepchild, grandchild,
parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-
law, brother-in-law, or sister-in-law, including adoptive relationships, any person sharing the grantee’s household (other than a tenant
of the grantee), a trust in which these persons (or the grantee) have more than 50 percent of the beneficial interest, a foundation in
which these persons (or the grantee) control the management of assets, and any other entity in which these persons (or the grantee)
own more than 50 percent of the voting interests.
(d)
Designation of Beneficiary. To the extent permitted by the Company, each grantee to whom an Award has been made
under the Plan may designate a beneficiary or beneficiaries to exercise any Award or receive any payment under any Award payable
on or after the grantee’s death. Any such designation shall be on a form provided for that purpose by the Administrator and shall not
be effective until received by the Administrator. If no beneficiary has been designated by a deceased grantee, or if the designated
beneficiaries have predeceased the grantee, the beneficiary shall be the grantee’s estate.
SECTION 13.
TAX WITHHOLDING
(a)
Payment by Grantee. Each grantee shall, no later than the date as of which the value of an Award or of any Shares or
other amounts received thereunder first becomes includable in the gross income of the grantee for Federal income tax purposes, pay
to the Company, or make arrangements satisfactory to the Administrator regarding payment of, any Federal, state, or local taxes of
any kind required by law to be withheld by the Company with respect to such income. The Company and its Affiliates shall, to the
extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to the grantee. The
Company’s obligation to deliver evidence of book entry (or share certificates) to
13
ACTIVE/119909774.14
Exhibit 10.46
any grantee is subject to and conditioned on tax withholding obligations being satisfied by the grantee.
(b)
Payment in Shares. The Administrator may require the Company’s tax withholding obligation to be satisfied, in whole
or in part, by the Company withholding from Shares to be issued pursuant to any Award a number of Shares with an aggregate Fair
Market Value (as of the date the withholding is effected) that would satisfy the withholding amount due; provided, however, that the
amount withheld does not exceed the maximum statutory tax rate or such lesser amount as is necessary to avoid liability accounting
treatment. For purposes of share withholding, the Fair Market Value of withheld Shares shall be determined in the same manner as
the value of Shares includible in income of the grantees. The Administrator may also require the Company’s tax withholding
obligation to be satisfied, in whole or in part, by an arrangement whereby a certain number of Shares issued pursuant to any Award
are immediately sold and proceeds from such sale are remitted to the Company in an amount that would satisfy the withholding
amount due.
SECTION 14.
SECTION 409A AWARDS
Awards to U.S. taxpayers are intended to be exempt from Section 409A to the greatest extent possible and to otherwise
comply with Section 409A. The Plan and all Awards shall be interpreted in accordance with such intent. To the extent that any Award
granted to a U.S. taxpayer is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A (a
“409A Award”), the Award shall be subject to such additional rules and requirements as specified by the Administrator from time to
time in order to comply with Section 409A. In this regard, if any amount under a 409A Award is payable upon a “separation from
service” (within the meaning of Section 409A) to a grantee who is then considered a “specified employee” (within the meaning of
Section 409A), then no such payment shall be made prior to the date that is the earlier of (i) six months and one day after the
grantee’s separation from service, or (ii) the grantee’s death, but only to the extent such delay is necessary to prevent such payment
from being subject to interest, penalties and/or additional tax imposed pursuant to Section 409A. Further, the settlement of any 409A
Award may not be accelerated except to the extent permitted by Section 409A. The Company makes no representation that any or all
of the payments or benefits described in the Plan will be exempt from or comply with Section 409A and makes no undertaking to
preclude Section 409A from applying to any such payment. The grantee shall be solely responsible for the payment of any taxes and
penalties incurred under Section 409A.
SECTION 15.
TERMINATION OF SERVICE RELATIONSHIP, TRANSFER, LEAVE OF ABSENCE, ETC.
(a)
Termination of Service Relationship. If the grantee’s Service Relationship is with an Affiliate and such Affiliate
ceases to be an Affiliate, the grantee shall be deemed to have terminated the grantee’s Service Relationship for purposes of the Plan.
(b)
For purposes of the Plan, the following events shall not be deemed a termination of a Service Relationship:
(i)
a transfer to the employment of the Company from an Affiliate or from the Company to an Affiliate, or from
one Affiliate to another; or
14
ACTIVE/119909774.14
Exhibit 10.46
(ii)
an approved leave of absence for military service or sickness, or for any other purpose approved by the
Company, if the employee’s right to re-employment is guaranteed either by a statute or by contract or under the policy pursuant to
which the leave of absence was granted or if the Administrator otherwise so provides in writing.
SECTION 16.
AMENDMENTS AND TERMINATION
(a)
Amendments Requiring Shareholders Approval. The Board may amend, alter or discontinue the Plan or amend the
terms of any Award or Award Certificate at any time, provided that (1) no such amendment, modification, change,
suspension or termination of the Plan or any Awards granted hereunder may materially impair any rights of a grantee
or materially increase any obligations of a grantee under the Plan without the consent of the grantee, unless the Board
determines such adjustment is required or desirable in order to comply with any applicable securities laws or stock
exchange requirements, and (2) shareholder approval will be required for amendments to:
(i)
any increase in the maximum number of Shares that may be issued pursuant to the exercise or vesting of
Awards granted under the Plan;
(ii)
any reduction in the exercise price of outstanding Stock Options or Share Appreciation Rights or effect
repricing through cancellation and re-grants or cancellation of Stock Options or Share Appreciation Rights in
exchange for cash or other Awards or take any other action with respect to a Stock Option or Share
Appreciation Right that would be treated as a repricing under the rules and regulations of any stock exchange
on which the Shares are listed (except as provided in Section 3(c) or 3(d));
(iii)
any amendment that extends the term of an Award beyond the original expiry date;
(iv)
if at any time, the Plan is amended to exclude participation by Non-Employee Directors, any amendment to
the Plan that may permit the introduction or reintroduction of Non-Employee Directors on a discretionary
basis;
(v)
any amendment that increases limits previously imposed on Non-Employee Directors;
(vi)
any amendment which would permit Awards to be transferable or assignable other than for normal estate
settlement purposes and for the purposes established in Section 12;
(vii)
any amendment to increase the maximum limit of the number of securities that may be:
a)
issued to Insiders within any one year period; or
b)
issuable to Insiders at any time;
c)
under the Plan, or when combined with the Company’s other security-based compensation
arrangements, which could exceed 10% of the total issued and outstanding Shares of the Company,
respectively;
15
ACTIVE/119909774.14
Exhibit 10.46
(viii)
adding provisions relating to a cashless exercise (other than a surrender of options for cash) which does not
provide for a full deduction of the underlying Shares from the maximum number reserved under the Plan for
issuance; and
(ix)
any amendment to the amending provisions of the Plan.
(b)
Amendments Not Requiring Shareholder Approval. Notwithstanding Section 16(a) but subject to the requirements of
any stock exchange upon which the Shares are then listed and applicable law, no shareholder approval will be
required for:
(i)
amendments to this Plan or any Award to avoid any additional tax on grantees under Section 409A of the
United States Internal Revenue Code or other applicable tax laws or regulations;
(ii)
amendments to this Plan of a “housekeeping nature”;
(iii)
changes to the vesting or exercise provisions or other restrictions applicable to any Award, Award Certificate
or this Plan not inconsistent with the provisions of Section 16(a);
(iv)
changes to the provisions of this Plan relating to the expiration of Awards prior to their respective expiration
dates upon the occurrence of certain specified events determined by the Board; and
(v)
the cancellation of an Award.
Notwithstanding the foregoing, to the extent required under the rules of any securities exchange or market system on which
the Shares are listed, or to the extent determined by the Administrator to be required by the Code to ensure that Incentive Stock
Options granted under the Plan are qualified under Section 422 of the Code, Plan amendments shall be subject to approval by
Company shareholders. Nothing in this Section 16 shall limit the Administrator’s authority to take any action permitted pursuant to
Section 3(c) or 3(d).
SECTION 17.
STATUS OF PLAN
With respect to the portion of any Award that has not been exercised and any payments in cash, Shares or other consideration
not received by a grantee, a grantee shall have no rights greater than those of a general creditor of the Company unless the
Administrator shall otherwise expressly determine in connection with any Award or Awards. In its sole discretion, the Administrator
may authorize the creation of trusts or other arrangements to meet the Company’s obligations to deliver Shares or make payments
with respect to Awards hereunder, provided that the existence of such trusts or other arrangements is consistent with the foregoing
sentence.
SECTION 18.
GENERAL PROVISIONS
(a)
No Distribution. The Administrator may require each person acquiring Shares pursuant to an Award to represent to
and agree with the Company in writing that such person is acquiring the shares without a view to distribution thereof.
16
ACTIVE/119909774.14
Exhibit 10.46
(b)
Issuance of Shares. To the extent certificated, share certificates to grantees under this Plan shall be deemed delivered
for all purposes when the Company or a share transfer agent of the Company shall have mailed such certificates in the United States
mail, addressed to the grantee, at the grantee’s last known address on file with the Company. Uncertificated Shares shall be deemed
delivered for all purposes when the Company or a share transfer agent of the Company shall have given to the grantee by electronic
mail (with proof of receipt) or by United States mail, addressed to the grantee, at the grantee’s last known address on file with the
Company, notice of issuance and recorded the issuance in its records (which may include electronic “book entry” records).
Notwithstanding anything herein to the contrary, the Company shall not be required to issue or deliver any evidence of book entry or
certificates evidencing Shares pursuant to the exercise or settlement of any Award, unless and until the Administrator has
determined, with advice of counsel (to the extent the Administrator deems such advice necessary or advisable), that the issuance and
delivery is in compliance with all applicable laws, regulations of governmental authorities and, if applicable, the requirements of any
exchange on which the Share are listed, quoted or traded. Any Shares issued pursuant to the Plan shall be subject to any stop-transfer
orders and other restrictions as the Administrator deems necessary or advisable to comply with federal, state or foreign jurisdiction,
securities or other laws, rules and quotation system on which the Shares listed, quoted or traded. The Administrator may place
legends on any share certificate or notations on any book entry to reference restrictions applicable to the Shares. In addition to the
terms and conditions provided herein, the Administrator may require that an individual make such reasonable covenants, agreements,
and representations as the Administrator, in its discretion, deems necessary or advisable in order to comply with any such laws,
regulations, or requirements. The Administrator shall have the right to require any individual to comply with any timing or other
restrictions with respect to the settlement or exercise of any Award, including a window-period limitation, as may be imposed in the
discretion of the Administrator.
(c)
Shareholder Rights. Until Shares are deemed delivered in accordance with Section 18(b), no right to vote or receive
dividends (other than the granting of Dividend Equivalent Rights as provided for under this Plan) or any other rights of a shareholder
will exist with respect to Shares to be issued in connection with an Award, notwithstanding the exercise of a Stock Option or any
other action by the grantee with respect to an Award.
(d)
Other Compensation Arrangements; No Employment Rights. Nothing contained in this Plan shall prevent the Board
from adopting other or additional compensation arrangements, including trusts, and such arrangements may be either generally
applicable or applicable only in specific cases. The adoption of this Plan and the grant of Awards do not confer upon any employee
any right to continued employment with the Company or any Subsidiary.
(e)
Trading Policy Restrictions. Option exercises and other Awards under the Plan shall be subject to the Company’s
insider trading policies and procedures, as in effect from time to time.
(f)
Clawback Policy. All Awards shall be subject to reduction, cancellation, forfeiture or recoupment to the extent
necessary to comply with (i) any clawback, forfeiture or other similar policy adopted by the Board or Administrator; and (ii)
applicable law.
SECTION 19.
EFFECTIVE DATE OF PLAN
This Plan shall become effective upon shareholder approval in accordance with applicable law, the Company’s bylaws and
articles of incorporation, and applicable stock exchange rules. No grants of Awards may be made hereunder after the tenth
anniversary of the
17
ACTIVE/119909774.14
Exhibit 10.46
Effective Date and no grants of Incentive Stock Options may be made hereunder after the tenth anniversary of the date the Plan was
initially approved by the Board.
The Ritchie Bros. Auctioneers Incorporated 2023 Share Incentive Plan was initially approved by the Board on April 3, 2023
and by shareholders of the Company on May 8, 2023. This Plan, as amended and restated, was approved by the Board on November
6, 2024.
SECTION 20.
GOVERNING LAW
This Plan and all Awards and actions taken thereunder shall be governed by, and construed in accordance with, the Province
of British Columbia.
18
ACTIVE/119909774.14
Exhibit 19.1
RB GLOBAL, INC.
POLICY REGARDING SECURITIES TRADES BY COMPANY PERSONNEL
Updated November 6, 2024
The Need for the Policy
The purchase or sale of securities while aware of material nonpublic information, or the disclosure of material nonpublic
information to others who then trade in securities of RB Global, Inc. (the “Corporation”), is prohibited by United States federal and
state securities and Canadian federal and provincial securities laws. Insider trading violations are pursued vigorously by the United
States Securities and Exchange Commission (the “SEC”) and the United States Department of Justice, and are punished severely.
There is parallel enforcement in Canada. While the regulatory authorities concentrate their efforts on the individuals who trade, or
who tip inside information to others who trade, the United States federal securities laws also impose potential liability on companies
and other “controlling persons” if they fail to take reasonable steps to prevent insider trading by company personnel.
The Corporation’s Board of Directors has adopted this Policy Regarding Securities Trades by Company Personnel
(the “Policy”) with the intent to prevent insider trading and to avoid the severe consequences associated with violations of the insider
trading laws. This Policy also is intended to prevent even the appearance of improper conduct on the part of anyone employed by or
associated with the Corporation (not just so-called insiders). RB Global personnel have all worked hard over the years to establish a
reputation for integrity and ethical conduct, and strict enforcement of this Policy is one way the Corporation works to maintain that
reputation.
The Consequences of Insider Trading
The SEC, the US national securities exchanges, through the Financial Industry Regulatory Authority (“FINRA”), and the
Canadian securities regulators investigate and are very effective at detecting insider trading. If you tip information to a person who
then trades, you are subject to the same penalties as that person, even if you did not trade and did not profit from that person’s
trading. There are also significant civil and criminal penalties in Canada under applicable Canadian securities laws for insider
trading.
•
Traders and Tippers. In the United States, the penalties for violating rules against insider trading can be severe and include:
o
Forfeiting any profit gained or loss avoided by the trading;
Exhibit 19.1
o
Payment of the loss suffered by the persons who, contemporaneously with the purchase or sale of securities that are
subject of a violation, have purchased or sold securities of the same class;
o
A civil penalty of up to three times the profit gained or loss avoided;
o
A criminal fine of up to $5,000,000 (no matter how small the profit); and
o
A jail term of up to 20 years.
•
Control Persons. The Corporation and its supervisory personnel, if they fail to take appropriate steps to prevent illegal insider
trading, are subject to the following penalties under United States law:
o
A civil penalty of $2,500,000 or more, up to three times the profit gained or loss avoided as a result of the violation;
and
o
A criminal penalty of up to $25,000,000.
•
Corporation-Imposed Sanctions. Failure to comply with this Policy may subject you to Corporation-imposed sanctions,
including termination for cause, whether or not your failure to comply results in a violation of law. Needless to say, a
violation of law, or even an SEC investigation that does not result in prosecution, can tarnish one’s reputation and irreparably
damage a career. It is not necessary for the Corporation to await the filing or conclusion of a civil or criminal action against
an alleged violator before taking disciplinary action.
Scope of Policy
This Policy applies to the following persons (collectively, “you” or the “RB Global Personnel”):
•
all employees, directors, and officers of the Corporation and its subsidiaries; and
•
those consultants of the Corporation and its subsidiaries that the Corporation’s Compliance Officer designates as being
subject to this Policy.
The Corporation’s Corporate Secretary is currently the Corporation’s Compliance Officer.
Statement of Policy
It is the policy of the Corporation that no RB Global Personnel who is aware of material nonpublic information relating to the
Corporation may, directly or indirectly, (a) buy or sell securities of the Corporation (other than pursuant to a pre-approved trading
plan that complies with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (a “Rule 10b5-1 Plan”)), or engage in
any other action to take personal advantage of that information, (b) pass that material nonpublic information on to others outside the
Corporation, including family and friends, or (c) recommend to any person that such person engage in or refrain from engaging in
Exhibit 19.1
any transaction involving the Corporation’s securities. In addition, it is the policy of the Corporation that no RB Global Personnel
who, in the course of working for the Corporation, learns of material nonpublic information about a company with which the
Corporation does business, including a customer or supplier of the Corporation, may trade in that company’s securities until the
information becomes publicly available or is no longer material.
Transactions that may be necessary or justifiable for independent reasons (such as the need to raise money for an emergency
expenditure) are not excepted from this Policy. The securities laws do not recognize such mitigating circumstances, and, in any
event, even the appearance of an improper transaction must be avoided to preserve the Corporation’s reputation for adhering to the
highest standards of conduct.
Material Information. Material information is any information that a reasonable investor would consider important in making
a decision to buy, hold, or sell securities. Any information that could be expected to affect the Corporation’s stock price, whether it is
positive or negative, should be considered material. While it is not possible to identify all information that would be deemed
“material,” some examples of information that ordinarily would be regarded as material are:
•
Projections of future earnings or losses, or other guidance based on financial results;
•
Financial results that are known but have not been publicly disclosed;
•
A pending or proposed merger, acquisition or tender offer;
•
A pending or proposed acquisition or disposition of a significant asset;
•
A change in dividend policy, the declaration of a stock split, or an offering of additional securities;
•
A change in management;
•
Development of a significant new product or process;
•
Cybersecurity risks and incidents, including the discovery of significant vulnerabilities or breaches;
•
Significant litigation or governmental investigations or major developments in such matters;
•
Receipt of, or any delay in receipt or failure to receive significant governmental approvals;
•
Impending bankruptcy or the existence of severe liquidity problems; or
•
The gain or loss of a significant customer, supplier, business partner or license.
Twenty-Twenty Hindsight. Remember, anyone scrutinizing your transactions will be doing so after the fact, with the benefit
of hindsight. As a practical matter, before engaging in any transaction, you should carefully consider how enforcement authorities
and others might view the transaction in hindsight.
Exhibit 19.1
When Information is “Public.” If you are aware of material nonpublic information, you may not trade until the information
has been disclosed broadly to the marketplace (such as by press release or an SEC filing) and the investing public has had time to
absorb the information fully. To avoid the appearance of impropriety, as a general rule, information should not be considered fully
absorbed by the marketplace until after the second business day after the information is released. If, for example, the Corporation
were to make an announcement on a Monday, you should not trade in the Corporation’s securities until Thursday. If an
announcement were made on a Friday, Wednesday generally would be the first eligible trading day.
Transactions by Affiliated Persons. This Policy also applies to (a) your family members who reside with you, anyone else
who lives in your household, and any family members who do not live in your household but who are financially dependent upon
you or whose transactions in Corporation securities are directed by you or are subject to your influence or control (such as parents or
children who consult with you before they trade in Corporation securities) and (b) all trusts, partnerships and other types of entities
formed for your benefit or for the benefit of a member of your family and over which you have the ability to influence or direct
investment decisions concerning securities (collectively, “Affiliated Persons”). You are responsible for the transactions of these
other Affiliated Persons and therefore should make them aware of the need to confer with you before they trade in the Corporation’s
securities.
Transactions Under Corporation Plans
Employee Stock Purchase Plan. Purchases of Corporation shares pursuant to the Corporation’s employee stock purchase plan
(“ESPP”) are subject to the special rules set forth in this paragraph. RB Global Personnel may not make an election to participate in
the ESPP, or any change to their elections under the ESPP that would be subject to insider trading laws, at a time when trading in the
Corporation’s securities by such person would violate applicable insider trading laws or this Policy. Provided that your elections
under the ESPP are made in accordance with this paragraph, the purchase of Corporation shares pursuant to and in compliance with
the terms of the ESPP shall not be deemed to violate this Policy.
Exercise of Stock Options. The trading prohibitions and restrictions set forth in this Policy do not apply to the exercise solely
for cash of an option to purchase securities of the Corporation.
Related Sales. This Policy applies to any sale of stock acquired pursuant to any Corporation plans, including any sale as part
of a broker-assisted cashless exercise of an option and any sale necessary to generate the cash needed to pay taxes or any applicable
exercise price. In other words, even though your acquisition of stock under a Corporation plan may be exempt from or permitted by
this Policy, you may not sell the stock you acquire under the Corporation plan, sell stock in anticipation of your acquisition, or
engage in any other transactions involving Corporation securities unless you do so in compliance with this Policy.
Exhibit 19.1
Tax Withholding on Restricted Stock/Units. The trading prohibitions and restrictions set forth in this Policy do not apply to
the withholding by the Corporation of the Corporation’s securities upon vesting of restricted stock or settlement of restricted stock
units to satisfy tax withholding requirements if (a) withholding is required by the applicable plan or award agreement or (b) the
election to exercise the tax withholding right was made in compliance with this Policy.
Additional Prohibited Transactions
The Corporation considers it improper and inappropriate for any RB Global Personnel to engage in short-term or speculative
transactions in the Corporation’s securities. It therefore is the Corporation’s policy that RB Global Personnel may not engage in any
of the following transactions:
Short-term Trading. Short-term trading of the Corporation’s securities may be distracting and may unduly focus RB Global
Personnel on the Corporation’s short-term stock market performance instead of the Corporation’s long-term business objectives. For
these reasons, any RB Global Personnel who purchases Corporation securities in the open market may not sell any Corporation
securities of the same class during the six months following the purchase without pre-clearance. Under very special circumstances,
short-term trading may be permitted. The person wishing to sell Corporation securities during the six months following the open
market purchase must first pre-clear the proposed transaction with the Corporation’s Compliance Officer. Any request for pre-
clearance of a short-term trading arrangement must be submitted to the Compliance Officer at least two weeks prior to the proposed
execution of documents evidencing the proposed transaction and must set forth a justification for the proposed transaction.
Short Sales. Short sales of the Corporation’s securities evidence an expectation on the part of the seller that the securities will
decline in value, and therefore may signal to the market that the seller has no confidence in the Corporation or its short-term
prospects. In addition, short sales may reduce the seller’s incentive to improve the Corporation’s performance. For these reasons,
short sales of the Corporation’s securities are prohibited by this Policy. In addition, Section 16(c) of the Securities Exchange Act of
1934, as amended, prohibits officers and directors from engaging in short sales.
Publicly Traded Options and Derivative Transactions. A transaction in options is, in effect, a bet on the short-term movement
of the Corporation’s stock and therefore may create the appearance that RB Global Personnel is trading based on inside information.
Transactions in options also may focus such person’s attention on short-term performance at the expense of the Corporation’s long-
term objectives. Accordingly, transactions in puts, calls, other derivative securities of the Corporation, or any derivative securities
that provide the economic equivalent of ownership of any of the Corporation’s securities or any opportunity, direct or indirect, to
profit from any change in the value of the Corporation’s securities, are prohibited by this Policy. (Option positions arising from
certain types of hedging transactions are governed by the section below captioned “Hedging Transactions”.)
Exhibit 19.1
Hedging Transactions. Certain forms of hedging or monetization transactions, such as zero-cost collars and forward sale
contracts, allow a person to lock in much of the value of his or her stock holdings, often in exchange for all or part of the potential
for upside appreciation in the stock. These transactions allow the person to continue to own the covered securities, but without the
full risks and rewards of ownership. When that occurs, the person may no longer have the same objectives as the Corporation’s other
shareholders. Therefore, the Corporation prohibits you from engaging in such transactions.
Margin Accounts and Pledges. Securities held in a margin account may be sold by the broker without the customer’s consent
if the customer fails to meet a margin call. Similarly, securities pledged (or hypothecated) as collateral for a loan may be sold in
foreclosure if the borrower defaults on the loan. Because a margin sale or foreclosure sale may occur at a time when the pledgor is
aware of material nonpublic information or otherwise is not permitted to trade in Corporation securities, RB Global Personnel are
prohibited from holding Corporation securities in a margin account or pledging Corporation securities as collateral for a loan. An
exception to this prohibition may be granted where a person wishes to pledge Corporation securities as collateral for a loan (not
including margin debt) and clearly demonstrates the financial capacity to repay the loan without resort to the pledged securities. Any
person who wishes to pledge Corporation securities as collateral for a loan must submit a request for approval to the Compliance
Officer at least two weeks prior to the proposed execution of documents evidencing the proposed pledge.
Gifts. RB Global Personnel may not donate or make any other transfer of the Corporation’s securities without consideration
when they otherwise are not permitted to trade under this Policy.
Post-Termination Transactions
This Policy continues to apply to your transactions in Corporation securities even after you have terminated your
employment or other relationship with the Corporation and its subsidiaries. If you are in possession of material nonpublic
information when your employment or other relationship terminates, you may not trade in Corporation securities until the second
full trading day after that information has become public or is no longer material.
Blackout Periods
Quarterly Blackout Periods. The Corporation’s announcement of its quarterly financial results almost always has the potential to
have a material effect on the market for the Corporation’s securities. Therefore, to avoid even the appearance of trading while aware
of material nonpublic information, persons who are or may be expected to be aware of the Corporation’s quarterly financial results
generally will not be allowed to trade in the Corporation’s securities during the period beginning on the 10 day prior to the end of
the Corporation’s fiscal quarter and ending after the second full trading day following the Corporation’s issuance of its quarterly
earnings release. Persons subject to these quarterly blackout periods include all directors, officers, certain identified employees of the
accounting department, and all other persons who are informed by the Compliance Officer that they are
th
Exhibit 19.1
subject to the quarterly blackout periods. The Compliance Officer will maintain and publish a list of the persons that are subject to
the quarterly blackout periods. The only exceptions to transactions during a quarterly blackout period are:
•
Exercises of stock options and purchases of Corporation stock under the ESPP that are specifically permitted under
“Transactions Under Corporation Plans”, provided that no Corporation stock is sold in the market to fund the option
exercise.
•
Transactions that comply with a pre-approved Rule 10b5-1 Plan.
Remember that trading outside the blackout periods or being excluded from the list of persons subject to the blackout periods
will not relieve you from liability if you are aware of material nonpublic information.
Event-specific Blackout Periods. From time to time, an event may occur that is material to the Corporation and is known by
only a few RB Global Personnel. So long as the event remains material and nonpublic, directors, officers, and such other persons as
are designated by the Compliance Officer may not trade in the Corporation’s securities. The existence of an event-specific blackout
will not be announced, other than to those who are aware of the event giving rise to the blackout. If, however, a person whose trades
are subject to pre-clearance requests permission to trade in the Corporation’s securities during an event-specific blackout, the
Compliance Officer will inform the requester of the existence of a blackout period, without disclosing the reason for the blackout.
Any person made aware of the existence of an event-specific blackout should not disclose the existence of the blackout to any other
person. The failure of the Compliance Officer to designate a person as being subject to an event-specific blackout will not relieve
that person of the obligation not to trade while aware of material nonpublic information. The only exceptions to transactions during
an event-specific blackout period are:
•
Exercises of stock options and purchases under the ESPP that are specifically permitted above under “Transactions
Pursuant to Corporation Plans”, provided that no Corporation stock is sold in the market to fund the option exercise.
•
Transactions that comply with a pre-approved Rule 10b5-1 Plan.
Pre-clearance Procedures
To help prevent inadvertent violations of securities laws and to avoid even the appearance of trading on inside information,
directors and officers of the Corporation and any other persons designated by the Compliance Officer as being subject to the
Corporation’s pre-clearance procedures, together with their Affiliated Persons, may not engage in any transaction in the
Corporation’s securities (including a gift, contribution to a trust, or similar transfer) without first obtaining pre-clearance of the
transaction from the Compliance Officer. The Compliance Officer will maintain and publish a list of the persons that are subject to
the pre-clearance requirements. A request for pre-clearance should be submitted to the Compliance Officer at least two business days
in advance of the proposed transaction. The Compliance Officer is under no obligation to
Exhibit 19.1
approve a trade submitted for pre-clearance, and may determine not to permit the trade or to require further information before
approving the trade.
Any person subject to the pre-clearance requirements who wishes to implement a Rule 10b5-1 Plan must first pre-clear the
plan with the Compliance Officer. As required by Rule 10b5-1, you may enter into a Rule 10b5-1 Plan only when you are not in
possession of material nonpublic information. In addition, you may not enter into a Rule 10b5-1 Plan during a blackout period.
Transactions effected pursuant to a pre-cleared Rule 10b5-1 Plan will not require further pre-clearance at the time of the transaction.
In the absence of the Compliance Officer, transactions may be pre-cleared by the Chief Financial Officer, provided that any
transaction by the Chief Financial Officer or the Chief Financial Officer’s Affiliated Persons may, in the absence of the Compliance
Officer, only be approved by the Chief Executive Officer.
In any case where this Policy would require the Corporation’s Compliance Officer or the Compliance Officer’s Affiliated
Persons to obtain pre-clearance of a plan or transaction, such pre-clearance may not be granted by the Compliance Officer and must
instead be granted by the Chief Financial Officer, or in the Chief Financial Officer’s absence, the Chief Executive Officer. In any
case where this Policy would require the Chief Executive Officer or President or their Affiliated Persons to obtain pre-clearance of a
plan or transaction, such pre-clearance may not be granted by the Compliance Officer and must instead be granted by the approval of
any two of the Chair of the Corporation’s Board of Directors, the Chief Financial Officer and the Compliance Officer.
Neither the Compliance Officer nor any other person responsible for the pre-clearance of a plan or transaction under this
Policy assumes responsibility for, and approval by the Compliance Officer or such other person does not protect anyone subject to
this Policy from, the consequences of prohibited insider trading.
Completion of Trades. After receiving written clearance to engage in a trade from the Compliance Officer, you must
complete the proposed trade within three business days or make a new trading request. Even if you have received clearance, you
may not engage in a trade if (a) such clearance has been rescinded by the Compliance Officer, (b) you have otherwise received
notice that the trading window has closed or (c) you have or acquire material nonpublic information.
Waivers
A waiver of any provision of this Policy may be authorized in writing by the Compliance Officer. All waivers shall be
reported to the Corporation’s Board of Directors. Any waiver of
Exhibit 19.1
this Policy with respect to the Corporation’s Chief Executive Officer or President must be approved by the Corporation’s Board of
Directors.
Corporation Assistance
Any person who has a question about this Policy or its application to any proposed transaction (including whether certain
information is material or has been made public) should consult with the Corporation’s Compliance Officer. Ultimately, however, the
responsibility for adhering to this Policy and avoiding unlawful transactions rests with the persons subject to this Policy. In addition,
if you violate this Policy or any applicable federal, state, national or provincial laws governing insider trading or know of any such
violation by any RB Global Personnel, you should report the violation immediately to the Compliance Officer.
Ownership
The Corporation’s Chief Legal Officer is responsible for ensuring this document is necessary, up-to-date, and supports
corporate policy.
Exhibit 21.1
Name of subsidiary
Incorporation
Ownership
Interest
Principal activity
Rouse Services LLC
USA (California)
100%
Auction Services
Rouse Appraisals LLC
USA (California)
100%
Appraisal Services
Rouse Sales LLC
USA (California)
100%
Auction Services
Rouse Analytics LLC
USA (California)
100%
Auction Services
RBA Holdings Inc.
USA (Delaware)
100%
Holding company
AssetNation, Inc.
USA (Delaware)
100%
E-commerce marketplace
Boom & Bucket, Inc.
USA (Delaware)
100%
Auction services
SalvageSale Mexico Holding LLC
USA (Delaware)
100%
Holding Company
Xcira, LLC
USA (Delaware)
100%
Auction services
IronPlanet, Inc
USA (Delaware)
100%
E-commerce marketplace
IronPlanet Motors, LLC
USA (Delaware)
100%
E-commerce marketplace
SmartEquip, Inc.
USA (Delaware)
100%
E-commerce marketplace
IAA Holdings, LLC
USA (Delaware)
100%
Holding Company
Axle Holdings Acquisition Company, LLC
USA (Delaware)
100%
Holding Company
Axle Holdings, Inc.
USA (Delaware)
100%
Holding Company
IAA Acquisition Corp.
USA (Delaware)
100%
Holding Company
IAA Holdings, Inc.
USA (Delaware)
100%
Holding Company
Insurance Auto Auctions Corp.
USA (Delaware)
100%
Auction Company
PJH Ventures, Inc.
USA (Delaware)
100%
Single-Purpose Entity
Ritchie Bros. Asset Solutions Inc.
USA (Florida)
100%
E-commerce marketplace
Veritread LLC
USA (Florida)
75%
Freight Services
VeriTread Exchange LLC
USA (Florida)
75.20%
Brokerage services
Insurance Auto Auctions of Georgia LLC
USA (Georgia)
100%
Auction Company
IAA Services, Inc.
USA (Illinois)
100%
Logistics Company
Insurance Auto Auctions, Inc.
USA (Illinois)
100%
Auction Company
Automotive Recovery Services, Inc.
USA (Indiana)
100%
Logistics Company
Ritchie Bros. Financial Services (America) Inc.
USA (Nevada)
100%
Brokerage services
Auto Disposal Systems, Inc.
USA (Ohio)
100%
Logistics Company
Leake Auction Company
USA (Oklahoma)
100%
Auction services
DDI MVS Group, LLC
USA (South Carolina)
100%
Lien and Title Registration
Technology Company
Decision Dynamics, LLC d/b/a DDI Technologies
USA (South Carolina)
100%
Lien and Title Registration
Technology Company
Insurance Auto Auctions Tennessee LLC
USA (Tennessee)
100%
Auction Company
Kruse Energy & Equipment Auctioneers, LLC
USA (Texas)
100%
Auction Services
Impact Texas, LLC
USA (Texas)
100%
Auction Company
RB Global Holdings Inc.
USA (Washington)
100%
Holding company
Ritchie Bros. Auctioneers (America) Inc.
USA (Washington)
100%
Auction services
Ritchie Bros. Properties Inc.
USA (Washington)
100%
Property management
Ritchie Bros. Holdings Ltd.
Canada
100%
Holding company
Ritchie Bros. Auctioneers (Canada) Ltd.
Canada
100%
Auction services
Ritchie Bros. Real Estate Service Ltd.
Canada
100%
Real estate services
Exhibit 21.1
Ritchie Bros. Properties Ltd.
Canada
100%
Property management
Ritchie Bros. Financial Services Ltd.
Canada
100%
Brokerage services
IronPlanet Canada Ltd.
Canada
100%
E-commerce marketplace
Rouse Services Canada Ltd.
Canada
100%
E-commerce marketplace
Ritchie Bros. Finance Ltd.
Canada
100%
Holding company
1206397 B.C. Unlimited Liability Company
Canada
100%
Holding Company
Impact Auto Auction Sudbury Ltd.
Canada (Ontario)
100%
Auction Company
Impact Auto Auctions Ltd.
Canada (Ontario)
100%
Auction Company
Suburban Auto Parts Inc.
Canada (Ontario)
100%
Auction Company
Ritchie Bros. Holdings B.V.
The Netherlands
100%
Holding company
Ritchie Bros. B.V.
The Netherlands
100%
Auction services
Ritchie Bros. Shared Services B.V.
The Netherlands
100%
Administrative services
Ritchie Bros. Properties B.V.
The Netherlands
100%
Property management
Mascus International B.V.
The Netherlands
100%
E-commerce marketplace
Mascus IP B.V.
The Netherlands
100%
E-commerce marketplace
Mascus A/S
The Netherlands
100%
E-commerce marketplace
IronPlanet UK Limited
United Kingdom
100%
Auction services
Ritchie Bros. UK Limited
United Kingdom
100%
Auction services
1st Interactive Design Limited
United Kingdom
100%
Auction services
Car Transplants (Holdings) Limited
United Kingdom
100%
Holding Company
Car Transplants (Hurleston) Limited
United Kingdom
100%
Dormant/Disregarded Entity
Car Transplants Limited
United Kingdom
100%
Dormant/Disregarded Entity
Car Transplants Recycling Limited
United Kingdom
100%
Dormant/Disregarded Entity
D.H. Systems Consultancy Limited
United Kingdom
100%
Dormant/Disregarded Entity
Doncaster Motor Spares Limited
United Kingdom
100%
Dormant/Disregarded Entity
FAB Recycling Limited
United Kingdom
100%
Dormant/Disregarded Entity
Gilbert Mitchell Holdings Limited
United Kingdom
100%
Dormant/Disregarded Entity
Gilbert Mitchell Limited
United Kingdom
100%
Dormant/Disregarded Entity
IAA International Holdings Limited
United Kingdom
100%
Holding Company
IAA UK Holdings Limited
United Kingdom
100%
Holding Company
IAA Vehicle Services Limited
United Kingdom
100%
Auction Company
Motorhog Limited
United Kingdom
100%
Dormant/Disregarded Entity
Motor Bundle Limited
United Kingdom
100%
Dormant/Disregarded Entity
Newhog Holdings Limited
United Kingdom
100%
Holding Company
Repossessions-UK Limited
United Kingdom
100%
Dormant/Disregarded Entity
Synetiq Holdings Limited
United Kingdom
100%
Holding Company
Synetiq Limited
United Kingdom
100%
Auction Company
Synetiq Nominees Limited
United Kingdom
100%
Dormant/Disregarded Entity
Ritchie Bros. Holdings Pty Ltd.
Australia
100%
Holding company
Ritchie Bros. Auctioneers Pty Ltd.
Australia
100%
Auction services
Ritchie Bros. Properties Pty Ltd.
Australia
100%
Property management
Ritchie Bros. Auctioneers Comercial de Equipamentos
Industriais Ltda
Brazil
100%
Administrative services
Exhibit 21.1
Ritchie Bros. Auctioneers (Beijing) Co. Ltd.
China
100%
Auction services
Ritchie Auction (Beijing) Co. Ltd.
China
100%
Auction services
Ritchie Bros. Investment Holdings (Luxembourg) SARL
Cyprus
100%
Holding company
Ritchie Bros. Auctioneers (ME) Limited
Cyprus
100%
Auction services
Ritchie Bros. Finland Oy
Finland
100%
E-commerce marketplace
Ritchie Bros. Auctioneers France SAS
France
100%
Auction services
R.B. Services SARL
France
100%
Administrative services
Ritchie Bros. Holdings SARL
France
100%
Holding company
Ritchie Bros. Properties EURL
France
100%
Property management
Ritchie Bros. Deutschland GmbH
Germany
100%
Auction services
Ritchie Bros. Auctioneers India Private Limited
India
100%
Auction services
IronPlanet Limited
Ireland
100%
Auction services
Ritchie Bros. Properties S.r.l.
Italy
100%
Property management
Ritchie Bros. Italia S.r.l.
Italy
100%
Auction services
Ritchie Bros. Properties Japan K.K.
Japan
100%
Property management
Ritchie Bros. Auctioneers (Japan) K.K.
Japan
100%
Auction services
IronPlanet Mexico, S. de R.L. de C.V.
Mexico
100%
E-commerce marketplace
Ritchie Bros. Auctioneers de Mexico, S. de R.L. de C.V.
Mexico
100%
Auction services
Ritchie Bros. Properties, S. de R.L. de C.V.
Mexico
100%
Property management
SalvageSale De Mexico S. de R.L. de C.V.
Mexico
100%
E-commerce marketplace
SalvageSale Servicios, S. de R.L. de C.V.
Mexico
100%
Administrative services
Ritchie Bros. (NZ) Limited
New Zealand
100%
Auction services
Ritchie Bros. Auctioneers (Panama) S.A.
Panama
100%
Auction services
Ritchie Bros. Polska Sp. Z.o.o.
Poland
100%
Auction services
Ritchie Bros. Auctioneers Pte Ltd.
Singapore
100%
Auction services
Ritchie Bros. Spain, SL
Spain
100%
Auction services
Ritchie Bros. Properties (Spain) S.L.U.
Spain
100%
Property management
Ritchie Bros. Sweden AB
Sweden
100%
E-commerce marketplace
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in the following Registration Statements:
1.
Registration Statement on Form S-3 No. 333-270559; and
2.
Registration Statement on Form S-8 Nos. 333-65533, 333-188350, 333-202636, 333-211112, 333-213114, 333-218398, 333-221439, 333-231330 and
333-271773.
of our reports dated February 26, 2025, with respect to the consolidated financial statements of RB Global, Inc., and the effectiveness of internal control over
financial reporting of RB Global, Inc., included in this Annual Report (Form 10-K) of RB Global, Inc. for the year ended December 31, 2024.
/s/ Ernst & Young LLP
Chicago, Illinois
February 26, 2025
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-65533, 333-188350, 333-202636, 333-211112, 333-
213114, 333-218398, 333-221439, 333-231330 and 333-271773) and the Registration Statement on Form S-3 (No. 333-270559) of RB Global, Inc. of our
report dated February 21, 2023, with respect to the consolidated financial statements of RB Global, Inc. included in this Annual Report (Form 10-K) of RB
Global, Inc. for the year ended December 31, 2024.
Vancouver, Canada
/s/ Ernst & Young LLP
February 26, 2025
Chartered Professional Accountants
EXHIBIT 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO RULE 13a-14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
I, Jim Kessler, certify that:
1.
I have reviewed this annual report on Form 10-K of RB Global, Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this
report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent
fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.
Date: February 26, 2025
/s/ Jim Kessler
Jim Kessler
Chief Executive Officer
EXHIBIT 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO RULE 13a-14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
I, Eric J. Guerin, certify that:
1.
I have reviewed this annual report on Form 10-K of RB Global, Inc.;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this
report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent
fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.
Date: February 26, 2025
/s/ Eric J. Guerin
Eric J. Guerin
Chief Financial Officer
EXHIBIT 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. §1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of RB Global, Inc. (the "Company") on Form 10-K for the period ended December 31, 2024, as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Jim Kessler, Chief Executive Officer, certify, pursuant to 18 U.S.C. §1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: February 26, 2025
/s/ Jim Kessler
Jim Kessler
Chief Executive Officer
EXHIBIT 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. §1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of RB Global, Inc. (the "Company") on Form 10-K for the period ended December 31, 2024, as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, Eric J. Guerin, Chief Financial Officer, certify, pursuant to 18 U.S.C. §1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: February 26, 2025
/s/ Eric J. Guerin
Eric J. Guerin
Chief Financial Officer