As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 2/19/15  Cenovus Energy Inc.               F-3D        2/19/15    6:529K                                   Merrill Corp-MD/FA

Document/Exhibit                   Description                      Pages   Size 

 1: F-3D        Registration of Securities Pursuant to a Dividend   HTML    325K 
                          or Interest Reinvestment Plan                          
 2: EX-5.1      Opinion re: Legality                                HTML     11K 
 3: EX-8.2      Opinion re: Tax Matters                             HTML     14K 
 4: EX-23.1     Consent of Experts or Counsel                       HTML      7K 
 5: EX-23.2     Consent of Experts or Counsel                       HTML     11K 
 6: EX-23.3     Consent of Experts or Counsel                       HTML      8K 

 

As filed with the Securities and Exchange Commission on February 18, 2015

Registration No. 333-        

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM F-3

 

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

 

CENOVUS ENERGY INC.

(Exact name of registrant as specified in its charter)

 

 

2600, 500 Centre Street S.E.

Calgary, Alberta, Canada T2G 1A6

(403) 766-2000

(Address and telephone number of Registrant’s principal executive offices)

 

CT Corporation System

111 8th Avenue

New York, New York 10011

(212) 894-8641

(Name, address and telephone number of agent for service)

 

Copies to:

 

 

Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement.

 

If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. x

 

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. x

 

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

 

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

 

If this Form is a registration statement pursuant to General Instruction I.C. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. o

 

If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.C. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. o

 

CALCULATION OF REGISTRATION FEE

 

Title of each class of securities to be registered

Amount to be Registered

Proposed maximum aggregate price per unit (1)

Proposed maximum aggregate Offering Price (1)

Amount of registration fee (3)

Common Shares (2)

12,000,000 shares

US$

19.56

US$

234,720,000

US$

27,274.46

 

(1)          Based on the average of the high and low prices of the common shares of Cenovus Energy Inc. (“Cenovus”) on February 11, 2015 on the New York Stock Exchange, and estimated solely for the purpose of calculating the amount of the registration fee pursuant to Rule 457(c) under the Securities Act of 1933, as amended.

(2)          Includes rights to purchase additional shares pursuant to the Registrant’s Amended and Restated Shareholder Rights Plan Agreement dated as of April 25, 2012, between Cenovus and Computershare Trust Company of Canada.  No separate consideration is paid for these rights and, as a result, the registration fee for these rights is included in the fee for the shares registered hereby.

(3)          The prospectus contained herein relates to an aggregate of 12,486,592 Common Shares, including, pursuant to Rule 429 under the Securities Act of 1933, as amended, 12,000,000 Common Shares registered hereby and 486,592 unsold Common Shares that were previously registered under the Registrant’s Registration Statement on Form F-3D (File No. 333-166419), filed on April 30, 2010.

 

If as a result of stock splits, stock dividends or similar transactions, the number of securities purported to be registered on this registration statement changes, the provisions of Rule 416 shall apply to this registration statement.

 

Pursuant to Rule 429 under the Securities Act of 1933, as amended, the prospectus contained in this Registration Statement relates to Registration Statement 333-166419.

 

 

 

CENOVUS ENERGY INC.

 

DIVIDEND REINVESTMENT PLAN

 

On April 21, 2010, Cenovus Energy Inc. (“Cenovus”, the “Corporation”, “we” or “us”) established a dividend reinvestment plan (the “Plan”) to provide holders of our common shares (“Common Shares”) with a simple and convenient method of investing cash dividends in additional Common Shares.

 

A Plan participant may obtain additional Common Shares by reinvesting all or any portion of the cash dividends paid on the Common Shares held by the Plan participant without paying any brokerage commissions or service charges.  The declaration of dividends is considered each quarter and is at the sole discretion of the board of directors of Cenovus (the “Board”).  Our dividends are presently expected to be paid on March 31, June 30, September 30 and December 31, or if such day is not a business day, on the previous business day.

 

The Common Shares are listed on the Toronto Stock Exchange (the “TSX”) and on the New York Stock Exchange (the “NYSE”) under the symbol “CVE.”  On February 17, 2015, the closing price of the Common Shares on the TSX was CDN$23.29 per share and the closing price of the Common Shares on the NYSE was US$18.83.

 

The Plan shares will either be Common Shares issued from the treasury of the Corporation or be Common Shares acquired on the open market through the TSX or the NYSE, as applicable.  The purchase price of Common Shares acquired through the open market (the “Market Purchase Shares”) will be 100 percent of the average purchase price of the Common Shares (denominated in the currency in which the Common Shares trade on the applicable stock exchange) purchased on behalf of the participants on the TSX and/or the NYSE, as applicable, on the date that such Market Purchase Shares were acquired.  The purchase price of Common Shares purchased on behalf of Plan participants through a treasury purchase (the “Treasury Purchase Shares”) will be: (i) 100 percent of the volume weighted average price of the Common Shares (denominated in the currency in which the Common Shares trade on the applicable stock exchange) traded on the TSX (with respect to Treasury Purchase Shares acquired on behalf of participants resident in Canada) or the NYSE (with respect to Treasury Purchase Shares acquired on behalf of participants resident in any jurisdiction other than Canada), as applicable, for the five trading days preceding the dividend payment date; or (ii) if determined by the Board, in their sole discretion, at any time, with effect at the next applicable dividend payment date, the Average Market Price (as defined below) less a discount of not greater than five (5) percent of the Average Market Price. The volume weighted average price for the Common Shares on the TSX for the five trading days preceding February 18, 2015 was CDN$24.31.  The volume weighted average price for the Common Shares on the NYSE for the five trading days preceding February 18, 2015 was US$19.48.

 

On February 12, 2015, we announced that Treasury Purchase Shares are to be issued at a discount of 3% to the Average Market Price, with effect at the next applicable dividend payment date.  Such discount will apply in respect of Treasury Purchase Shares, if any, until such time as the Board or, by authority of the Board, any one of the President & Chief Executive Officer, the Executive Vice-President & Chief Financial Officer, the Treasurer or the Corporate Secretary of the Corporation, with effect at the time of declaration of the next dividend payment, determine to further change or eliminate the discount then applicable in respect of Treasury Purchase Shares.  Participants will be promptly notified of any further changes by way of press release.

 

We cannot estimate anticipated proceeds from sales of Common Shares pursuant to the Plan, which will depend upon the market price of the Common Shares, the extent of shareholder participation in the Plan and other factors.  We will not pay underwriting commissions in connection with the Plan but will incur costs of approximately US$105,774.26 in connection with this offering.

 

On April 30, 2010, we filed a registration statement with the Securities and Exchange Commission including a prospectus relating to 500,000 Common Shares issuable pursuant to the Plan to participants resident in any jurisdiction other than Canada.  This prospectus relates to 486,592 of such Common

 

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Shares of the Corporation that remain available for issuance as of the date hereof and an additional 12,000,000 Common Shares, which Common Shares, in each case, if as and when issued, will be issued pursuant to the Plan.

 

We urge you to carefully read the “Risk Factors” section beginning on page 4, where we describe risks associated with the Plan and our business and operations, before you make your investment decision.

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete.  Any representation to the contrary is a criminal offence.

 

The date of this prospectus is February 18, 2015.

 

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RISK FACTORS

 

Before you decide to participate in the Plan and invest in the Common Shares, you should be aware of the following material risks in making such an investment.  You should consider carefully these risk factors together with all risk factors and information included or incorporated by reference in this prospectus, including the risk factors beginning on page 47 of our Annual Information Form for the year ended December 31, 2014 (“AIF”), filed on Form 40-F, before you decide to participate in the Plan and purchase Common Shares.  In addition, you should consult your own financial and legal advisors before making an investment.

 

Risks Related to the Plan

 

You will not know the price of the Common Shares you are purchasing under the Plan at the time you authorize the investment or elect to have your dividends reinvested.

 

The price of the Common Shares may fluctuate between the time you decide to purchase Common Shares under the Plan and the time of actual purchase.  In addition, during this time period, you may become aware of additional information that might affect your investment decision.

 

WHERE YOU CAN FIND MORE INFORMATION

 

We are subject to the informational requirements of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”) and, in accordance with the Exchange Act, we also file reports with and furnish other information to the United States Securities and Exchange Commission (the “SEC”).  Under the multi-jurisdictional disclosure system adopted by the United States, these reports and other information (including financial information) may be prepared, in part, in accordance with the disclosure requirements of Canada, which differ from those in the United States.  Any document we file with the SEC can be read and copied at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549.  Please call the SEC at 1-800-SEC-0330 or contact them at www.sec.gov for further information on the operation of the Public Reference Rooms.  Our filings are also available electronically from the SEC’s Electronic Document Gathering and Retrieval System (EDGAR) at www.sec.gov. You may also want to visit our website at cenovus.com for further information.

 

We have filed under the United States Securities Act of 1933, as amended (the “Securities Act”) a registration statement on Form F-3 relating to our Plan.  This prospectus forms a part of the registration statement.  This prospectus does not contain all of the information included in the registration statement, certain portions of which have been omitted as permitted by the rules and regulations of the SEC.  For further information about us and the Common Shares you are encouraged to refer to the registration statement and the exhibits that are incorporated by reference into it.  Statements contained in this prospectus describing provisions of the Plan are not necessarily complete, and in each instance reference is made to the copy of the Plan which is included as an exhibit to the registration statement, and each such statement in this prospectus is qualified in all respects by such reference.

 

DOCUMENTS INCORPORATED BY REFERENCE

 

We incorporate by reference into this prospectus the following documents filed under the Exchange Act with the SEC:

 

1.              Our Annual Report on Form 40-F for the fiscal year ended December 31, 2014, dated February 12, 2015 (the “Annual Report on Form 40-F”).

 

In addition, all subsequent annual reports on Form 40-F, Form 20-F, or Form 10-K, and all subsequent filings on Form 10-Q or Form 8-K, that we file pursuant to the Exchange Act prior to the termination of this offering, are hereby deemed to be incorporated by reference into this prospectus.  Also, we may incorporate by reference our future reports on Form 6-K subsequent to the date of this prospectus by stating in those Forms 6-K that they are being incorporated by reference into this prospectus.

 

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the sufficiency of the our liquidity position; the accuracy of cost estimates; fluctuations in commodity prices,

 

·              currency and interest rates;

 

·              fluctuations in product supply and demand;

 

·              market competition, including from alternative energy sources;

 

·              risks inherent in our marketing operations, including credit risks;

 

·              maintaining desirable ratios of debt to adjusted earnings before interest, taxes, depreciation and amortization as well as debt to capitalization;

 

·              our ability to access various sources of debt and equity capital, generally, and on terms acceptable to us;

 

·              changes in credit ratings applicable to us or any of our securities;

 

·              changes to our dividend plans or strategy, including the dividend reinvestment plan;

 

·              accuracy of our reserves, resources and future production estimates;

 

·              our ability to replace and expand oil and gas reserves;

 

·              our ability to maintain our relationships with our partners and to successfully manage and operate our integrated heavy oil business;

 

·              reliability of our assets;

 

·              potential disruption or unexpected technical difficulties in developing new products and manufacturing processes;

 

·              refining and marketing margins;

 

·              potential failure of new products to achieve acceptance in the market;

 

·              unexpected cost increases or technical difficulties in constructing or modifying manufacturing or refining facilities;

 

·              unexpected difficulties in producing, transporting or refining of crude oil into petroleum and chemical products;

 

·              risks associated with technology and its application to our business;

 

·              the timing and the costs of well and pipeline construction;

 

·              our ability to secure adequate product transportation including sufficient crude-by-rail or alternate transportation to address any gaps caused by operational constraints in the pipeline system;

 

·              changes in the regulatory framework in any of the locations in which we operate, including changes to the regulatory approval process and land-use designations, royalty, tax, environmental,

 

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greenhouse gas, carbon and other laws or regulations, or changes to the interpretation of such laws and regulations, as adopted or proposed, the impact thereof and the costs associated with compliance;

 

·              the expected impact and timing of various accounting pronouncements, rule changes and standards on our business, our financial results and our consolidated financial statements;

 

·              changes in the general economic, market and business conditions; the political and economic conditions in the countries in which we operate;

 

·              the occurrence of unexpected events such as war, terrorist threats and the instability resulting therefrom; and

 

·              risks associated with existing and potential future lawsuits and regulatory actions against us.

 

Statements relating to “reserves” and “contingent resources” are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and contingent resources described exist in the quantities predicted or estimated, and can be profitably produced in the future.

 

We caution that the foregoing list of important factors is not exhaustive. Events or circumstances could cause our actual results to differ materially from those estimated or projected and expressed in, or implied by, these forward-looking statements. You should carefully consider the matters discussed under “Risk Factors” in this prospectus. You should also refer to “Risk Management” in our annual Management’s Discussion and Analysis included in our Annual Report on Form 40-F incorporated by reference herein and to the risk factors described in other documents we file from time to time with securities regulatory authorities, available at www.sedar.com, www.sec.gov and on our website at cenovus.com. Except as required by applicable securities law, we undertake no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors affecting those statements, whether as a result of new information, future events or otherwise. Information on or connected to our website, even if referred to in a document incorporated by reference herein, does not constitute part of this prospectus.

 

CENOVUS ENERGY INC.

 

Cenovus is a Canadian integrated oil company headquartered in Calgary, Alberta. We began independent operations on December 1, 2009 following the split of Encana Corporation into two independent publicly traded energy companies. Cenovus is in the business of developing, producing and marketing crude oil, natural gas liquids (“NGLs”) and natural gas in Canada with refining operations in the United States.

 

Our reportable segments are as follows:

 

·                  Oil Sands, which includes the development and production of Cenovus’s bitumen assets at Foster Creek, Christina Lake and Narrows Lake as well as projects in the early stages of development, such as Grand Rapids and Telephone Lake. The Athabasca natural gas assets also form part of this segment. Certain of the Company’s operated oil sands properties, notably Foster Creek, Christina Lake and Narrows Lake, are jointly owned with ConocoPhillips, an unrelated U.S. public company.

 

·                  Conventional, which includes the development and production of conventional crude oil, NGLs and natural gas in Alberta and Saskatchewan, including the heavy oil assets at Pelican Lake. This segment also includes the carbon dioxide enhanced oil recovery project at Weyburn and emerging tight oil opportunities.

 

·                  Refining and Marketing, which is responsible for transporting, selling and refining crude oil into petroleum and chemical products. Cenovus jointly owns two refineries in the U.S. with the operator Phillips 66, an unrelated U.S. public company. This segment coordinates

 

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Cenovus’s marketing and transportation initiatives to optimize product mix, delivery points, transportation commitments and customer diversification.

 

·                  Corporate and Eliminations, which primarily includes unrealized gains and losses recorded on derivative financial instruments, gains and losses on divestiture of assets, as well as other Cenovus-wide general and administrative costs, financing activities and research costs. As financial instruments are settled, the realized gains and losses are recorded in the operating segment to which the derivative instrument relates. Eliminations relate to sales and operating revenues and purchased product between segments, recorded at transfer prices based on current market prices, and to unrealized intersegment profits in inventory.

 

Our principal executive and registered office is located at 2600, 500 Centre Street S.E., Calgary, Alberta, T2G 1A6, Canada.

 

USE OF PROCEEDS

 

The net proceeds from the sale of the Common Shares will be principally used for general corporate purposes.  We have no basis for estimating precisely either the number of Common Shares that may be sold under the Plan or the prices at which such shares may be sold.  The amount of proceeds that we will receive will depend upon the market price of the Common Shares, the extent of shareholder participation in the Plan and other factors.

 

THE PLAN

 

The following is a summary of the material attributes of the Plan.  The summary does not purport to be complete and is subject to, and qualified in its entirety by, reference to the complete Plan that is filed as an exhibit to the registration statement of which this prospectus forms a part.  50,000,000 additional Common Shares, including the 12,000,000 additional Common Shares offered by this prospectus, if as and when issued, will be issued pursuant to the Plan, which was effective as of April 21, 2010.  Capitalized terms used in this summary and not defined elsewhere shall have the meaning attributed to them in the Plan.

 

Purpose of the Plan

 

The Plan permits holders of Common Shares to automatically reinvest all or any portion of the cash dividends paid on their Common Shares in additional Common Shares.  Common Shares distributed under the Plan will, at the option of the Corporation, be issued from the treasury of the Corporation or purchased by the agent appointed to administer the Plan (the “Plan Agent”) in the open market on a stock exchange, or a combination of both and, in each case, in the manner specified herein.

 

Participation in the Plan

 

Eligibility

 

All registered and beneficial owners of Common Shares who are residents in Canada, in the United States and any other jurisdiction where the Common Shares are qualified for sale can participate in the Plan.  The Common Shares are registered under the Securities Act and are offered for sale in both Canada and the United States.  Shareholders that are resident in jurisdictions other than Canada and the United States can also participate in the Plan, subject to any restrictions of laws in such shareholder’s jurisdiction of residence.

 

Enrollment — Registered Shareholders

 

Registered shareholders (other than Clearing and Depository Services, Inc. (“CDS”) or The Depository Trust Company (“DTC”)) may enroll all or any portion of their Common Shares in the Plan by completing and delivering to the Plan Agent, in the manner provided for in the Plan, a duly

 

9

 

completed and executed enrollment form in the form provided by the Corporation and the Plan Agent for this purpose.  Registered shareholders may obtain an enrollment form by contacting the Plan Agent in any of the manners specified in the Plan or by following the instructions provided on the Corporation’s website at cenovus.com.  CDS will provide separate instructions to the Plan Agent regarding the extent of its participation in the Plan on behalf of beneficial owners of Common Shares.

 

The enrollment form or instructions from CDS, as applicable, will direct (or be deemed to direct, as applicable) the Corporation to forward to the Plan Agent all cash dividends in respect of Common Shares registered in the name of the participant that are enrolled in the Plan and will direct (or be deemed to direct, as applicable) the Plan Agent to reinvest such cash dividends, together with cash dividends in respect of Common Shares held by the Plan Agent for the participant’s account under the Plan, in Plan Shares (as defined below) in accordance with the Plan.

 

An enrollment form must be received by the Plan Agent no later than 4:00 p.m. (Toronto time) on the fifth (5th) business day immediately preceding a dividend record date in order to take effect on the dividend payment date to which such dividend record date relates.  If an enrollment form is received by the Plan Agent from a registered shareholder after that time, the enrollment form will not take effect on such dividend payment date and will only take effect on the next following and subsequent dividend payment dates.  Instructions from CDS must be received by the Plan Agent within two (2) days after the applicable dividend record date.

 

Enrollment — Beneficial Owners of Common Shares

 

Effective March 31, 2014, DTC is no longer participating in dividend reinvestment plans for Canadian issuers. As a result, DTC participants are required to withdraw their securities from DTC and deposit them with CDS or have them registered in customer name in order to participate in the Plan.

 

Beneficial owners of Common Shares registered in the name of CDS or a nominee may not directly enroll in the Plan in respect of those Common Shares, but must instead either (i) transfer the Common Shares into their own name and then enroll such Common Shares in the Plan directly, or (ii) make appropriate arrangements with the broker, investment dealer, financial institution or other nominee who holds their Common Shares to enroll in the Plan on their behalf, either as a nominee that delivers a completed and executed enrollment form to the Plan Agent, in the manner provided in the Plan, or, if applicable, as a CDS participant through instructions from CDS.

 

Where a beneficial owner of Common Shares wishes to enroll in the Plan through a CDS participant in respect of Common Shares registered through CDS, appropriate instructions must be received by CDS from the CDS participant not later than such deadline as may be established by CDS from time to time, in order for the instructions to take effect on the dividend payment date to which that dividend record date relates.

 

Instructions received by CDS after its internal deadline will not take effect until the next following dividend payment date.  CDS participants holding Common Shares on behalf of beneficial owners of Common Shares registered through CDS must arrange for CDS to enroll such Common Shares in the Plan on behalf of such beneficial owners in respect of each dividend payment date.

 

Beneficial owners of Common Shares should contact the broker, investment dealer, financial institution or other nominee who holds their Common Shares to provide instructions regarding their participation in the Plan and to inquire about any applicable deadlines that the nominee may impose or be subject to.

 

Continued Enrollment

 

Common Shares enrolled by a participant (other than CDS) in the Plan will remain enrolled in and will automatically continue to be enrolled in the Plan until such time as the Plan is terminated by the Corporation or until the participant’s enrollment is terminated by the participant or by the Corporation.

 

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Statements of Account

 

An account will be maintained by the Plan Agent for each participant with respect to purchases of Plan Shares under the Plan for the account of such participant.  An unaudited statement regarding purchases under the Plan will be mailed on a quarterly basis to each participant setting out, among other things, the number of Plan Shares purchased through the Plan, the applicable Average Market Price per Plan Share and the amount of any applicable withholding tax.  These statements are a participant’s continuing record of purchases of Plan Shares made on behalf of such participant pursuant to the Plan and should be retained for income tax purposes.

 

Shareholders are responsible for calculating and monitoring their own adjusted cost base in Common Shares for Canadian federal income tax purposes, and for calculating and monitoring their own adjusted tax basis in Common Shares for U.S. federal income tax purposes, as certain averaging and other rules may apply and such calculations may depend on the cost of other Common Shares held by a shareholder and certain other factors.

 

Beneficial owners of Common Shares who are enrolled in the Plan through a broker, investment dealer, financial institution or other nominee may or may not be provided with such reports or forms from their broker, investment dealer, financial institution or other nominee.

 

Liabilities of the Corporation and the Plan Agent

 

Neither the Corporation nor the Plan Agent will be liable:

 

(a)                                 for any act or omission to act, or will have any duties, responsibilities or liabilities except as expressly set forth in the Plan or required by law;

 

(b)                                 in respect of the prices at which Plan Shares are purchased on behalf of participants under the Plan or the timing of purchases made under the Plan;

 

(c)                                  in respect of any decision to amend, suspend, terminate or replace the Plan in accordance with the terms hereof;

 

(d)                                 in respect of the involuntary termination of a shareholder’s enrollment in the Plan in the circumstances described herein;

 

(e)                                  in respect of any failure to terminate an individual participant’s enrollment in the Plan upon such participant’s death before receipt of actual notice of death; or

 

(f)                                   in respect of income taxes or other liabilities payable by any participant or beneficial owner in connection with their participation in the Plan.

 

Neither the Corporation nor the Plan Agent can assure a profit or protect against a loss on Plan Shares purchased under the Plan.

 

The Corporation and the Plan Agent shall have the right to reject any request regarding enrollment, withdrawal or termination from the Plan if such request is not received in proper form.  Any such request will be deemed to be invalid until any irregularities have been resolved to the satisfaction of the Corporation and/or the Plan Agent.

 

Miscellaneous

 

Voting of Plan Shares

 

Whole Common Shares held under the Plan by the Plan Agent for a participant’s account on the record date for a vote of shareholders will be voted in accordance with the instructions of the participant, or its

 

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Canadian Federal Income Tax Considerations

 

The following is a general summary of the principal Canadian federal income tax considerations generally applicable to a beneficial owner of Common Shares (i) who is a Plan participant, or (ii) who is not a registered holder of Common Shares but who has instructed the broker, investment dealer, financial institution or other nominee who holds their Common Shares to enroll in the Plan on their behalf (each, a “Plan Participant”).  This summary is based on the provisions of the Income Tax Act (Canada) (the “Act”) and the regulations thereunder, all specific proposals to amend the Act or the regulations publicly announced by the government of Canada (the “Proposed Amendments”), and the published written administrative practices of the Canada Revenue Agency (the “CRA”), all as of February 2, 2015. This summary assumes that all Proposed Amendments will be enacted in the form proposed, although no assurances can be given that the Proposed Amendments will be enacted as proposed, or at all. This summary does not otherwise take into account or anticipate any changes in law or administrative practice, nor does it take into account provincial or territorial laws of Canada or the tax laws of any other country.

 

This summary assumes that all Common Shares held by a Plan Participant, including Common Shares acquired under the Plan, are held by the Plan Participant as capital property and that the Plan Participant deals at arm’s length with the Corporation and is not affiliated with the Corporation.  Generally, the Common Shares will be considered to be capital property of a Plan Participant unless the Plan Participant holds the shares in the course of carrying on a business of trading or dealing in securities or otherwise as part of a business of buying and selling securities or the Plan Participant acquired the shares in one or more transactions considered to be part of an adventure or concern in the nature of trade.  Certain Plan Participants who might not otherwise be considered to hold their Common Shares as capital property may, in certain circumstances, be entitled to make the irrevocable election under subsection 39(4) of the Act to treat all of their “Canadian securities” (as defined in the Act) as capital property.

 

This summary is not applicable to a Plan Participant that is a “specified financial institution” (as defined in the Act), or to a Plan Participant an interest in which is a “tax shelter investment” (as defined in the Act), or, for the purposes of certain rules applicable to securities held by financial institutions (referred to as the “mark-to-market” rules), a “financial institution” (as defined in the Act) or has entered or will enter into a “derivative forward agreement” (as defined in the Act) with respect to the Common Shares, or to which the “functional currency” reporting rules in section 261 of the Act apply.

 

Generally, for purposes of the Act, all amounts relating to the acquisition, holding or disposition of Common Shares, including the receipt or deemed receipt of dividends, must be converted into Canadian dollars based on exchange rates as determined in accordance with the Act.

 

Canadian Participants

 

This portion of this summary applies to Plan Participants who, at all relevant times and for the purposes of the Act, are or are deemed to be residents of Canada (each, a “Canadian Participant”).

 

Dividends

 

The reinvestment of cash dividends pursuant to the Plan does not relieve a Canadian Participant of any liability for income taxes that may otherwise be payable on such amounts.  A Canadian Participant will be treated, for tax purposes, as having received, on each dividend payment date, a taxable dividend equal to the full amount of the cash dividend payable on such date, which dividend will be subject to the same tax treatment accorded to taxable dividends received by the Canadian Participant from a taxable Canadian corporation resident in Canada.  For example, in the case of a Canadian Participant who is an individual, dividends will be subject to the gross-up and credit rules contained in the Act, and, in the case of a Canadian Participant that is a “private corporation” or a “subject corporation” (both as defined in the Act), a refundable tax will apply to the amount of the dividend.  The Corporation has designated that all of its taxable dividends paid from November 30, 2009 will be “eligible dividends” within the meaning of the Act

 

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Alternative Minimum Tax

 

For the purpose of calculating the alternative minimum tax of a Canadian Participant who is an individual, the actual amount of dividends received (exclusive of the gross-up) and 80% of capital gains are included in the “adjusted taxable income” (as defined in the Act) of that Canadian Participant.

 

Non-Resident Participants

 

This portion of this summary applies to Plan Participants who, at all relevant times and for the purposes of the Act, are not and are not deemed to be residents of Canada (each, a “Non-Resident Participant”).

 

Dividends

 

Any dividends paid or credited to the Plan Agent in respect of a Non-Resident Participant’s Common Shares will be subject to a non-resident withholding tax for Canadian income tax purposes.  Under the Act, the rate of withholding tax on dividends is 25%.  This rate may be subject to reduction under the provisions of any income tax treaty between Canada and the country in which the Non-Resident Participant is resident.  For example, under the provisions of the Canada-United States Income Tax Convention, 1980 (the “Canada-U.S. Treaty”), where the Non-Resident Participant is a “resident” of the United States, is fully entitled to the benefits of the Canada-U.S. Treaty, and does not maintain a “permanent establishment” in Canada (each within the meaning of the Canada-U.S. Treaty) to which the holding of the Common Shares on which the dividends are paid is effectively connected, the rate of Canadian withholding tax will generally not exceed 15% of the gross dividend amount.

 

Dividends paid on the Common Shares to a Non-Resident Participant will generally be reduced by Canadian withholding tax before reinvestment.

 

Non-Resident Participants may be liable for additional tax on dividends paid on Common Shares held in their Plan account in their respective countries of residence.

 

Capital Gains

 

A Non-Resident Participant is not subject to Canadian income tax under the Act for any capital gain realized on the disposition or deemed disposition of Common Shares unless such shares are “taxable Canadian property” (as defined in the Act) to such Non-Resident Participant.  Provided that the Common Shares are listed on a designated stock exchange (which currently includes the TSX and the NYSE) at the time of disposition, Common Shares acquired through the Plan generally will not be taxable Canadian property to a Non-Resident Participant unless:

 

(a)                                 at any time during the 60-month period that ends at the time of disposition: (i) 25% or more of the issued shares of any class of the Corporation’s capital stock were owned by or belonged to one or any combination of (A) the Non-Resident Participant, (B) persons with whom the Non-Resident Participant did not deal at “arm’s length” (within the meaning of the Act) , and (C) partnerships in which the Non-Resident Participant or a person referred to in (B) holds a membership interest directly or indirectly through one or more partnerships; and (ii) more than 50% of the fair market value of the Common Shares was derived directly or indirectly from one or any combination of real or immoveable property situated in Canada, Canadian resource properties, timber resource properties or options in respect of, or interests in, the foregoing;

 

(b)                                 the Common Shares are used by the Non-Resident Participant in carrying on business in Canada; or

 

(c)                                 the Common Shares are otherwise deemed by a provision of the Act to be taxable Canadian property.

 

The requirement in paragraph (a)(ii) above would generally be expected to be satisfied.

 

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Where Common Shares represent taxable Canadian property to the Non-Resident Participant, any capital gain realized on a disposition or deemed disposition of the Common Shares will be subject to taxation in Canada, except as otherwise provided in any tax treaty between Canada and the Non-Resident Participant’s country of residence.  Under the current provisions of the Canada-U.S. Treaty, Article XIII will not generally provide such an exemption for Non-Resident Participants who are residents of the United States.

 

Termination of Participation

 

When a Non-Resident Participant’s participation in the Plan is terminated by the Non-Resident Participant or the Corporation or when the Plan is terminated by the Corporation, the Non-Resident Participant will receive a cash payment of the value of any fractional Common Share interest remaining in the Non-Resident Participant’s account.  A deemed dividend, subject to Canadian withholding tax, may arise if the cash payment for a fractional Common Share exceeds the paid-up capital (within the meaning of the Act) in respect of such fractional Common Share. A deemed dividend is treated in the manner described under “Non-Resident Participants — Dividends”.

 

United States Federal Income Tax Considerations

 

The following summary describes certain U.S. federal income tax consequences which may be applicable to a U.S. Holder (as defined below) of Common Shares that participates in the Plan (as used in this section, a “U.S. Participant”).  As used in this section, the term “U.S. Holder” means a beneficial owner of a Common Share that is (i) a citizen or individual resident of the United States as determined for U.S. federal income tax purposes, (ii) a corporation or other entity taxable as a corporation organized in or under the laws of the United States, any state thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income taxation without regard to the source or (iv) a trust if a U.S. court has primary supervision over its administration and one or more U.S. persons have the authority to control all substantial decisions of the trust, or if the trust has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.  If a pass-through entity, including a partnership or other entity classified as a partnership for U.S. federal income tax purposes, is a beneficial owner of Common Shares, the U.S. federal income tax treatment of an owner or partner generally will depend upon the status of such owner or partner and upon the activities of the pass-through entity. Any owner or partner of a pass-through entity holding Common Shares is urged to consult its own tax advisor.

 

This discussion is based on the U.S. Internal Revenue Code of 1986, as amended (the “Code”), administrative pronouncements, judicial decisions, existing and proposed Treasury Regulations, the Income Tax Convention between the United States and Canada (the “Tax Convention”) and interpretations of the foregoing, all as of the date hereof. All of the foregoing authorities are subject to change (possibly with retroactive effect), and any such change may result in U.S. federal income tax consequences to a U.S. Participant that are materially different from those described below. No rulings from the U.S. Internal Revenue Service (the “IRS”) have been or will be sought with respect to the matters described below, and consequently, the IRS may not take a similar view of the consequences described below.

 

This summary does not purport to be a full description of all U.S. federal income tax considerations that may be relevant to a U.S. Participant in light of such U.S. Participant’s particular circumstances and only addresses U.S. Participants that hold Common Shares as capital assets within the meaning of Section 1221 of the Code.  Furthermore, this summary does not address the U.S. federal income tax considerations applicable to U.S. Participants subject to special rules, such as (i) certain financial institutions, real estate investment trusts, regulated investment companies or insurance companies; (ii) tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred accounts; (iii) traders in securities that elect to use a mark-to-market method of accounting; (iv) dealers in securities or currencies; (v) persons holding Common Shares in connection with a hedging transaction, “straddle”, conversion transaction or other integrated transaction; (vi) persons that own directly, indirectly or constructively ten percent or more, by voting power, of the outstanding equity interests of the Corporation; (vii) persons that acquired the Common Shares in connection with the exercise of employee

 

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stock options or otherwise as compensation for services; (viii) persons whose “functional currency” is not the U.S. dollar; (ix) persons subject to the alternative minimum tax; and (x) U.S. expatriates.  In addition, this discussion does not include any description of any estate and gift tax consequences, or the tax laws of any state, local, non-U.S. or other government that may be applicable.

 

The following discussion is for general information only and is not intended to be, nor should it be construed to be, legal or tax advice to any holder or prospective holder of Common Shares and no opinion or representation with respect to the U.S. federal income tax consequences to any such holder or prospective holder is made.  Holders of Common Shares are urged to consult their tax advisors with respect to the U.S. federal, state and local tax consequences, the non-U.S. tax consequences and the non-tax consequences of the acquisition, ownership and disposition of Common Shares.

 

Amount Includable in Income

 

The following discussion is applicable except to the extent that the “PFIC” rules (discussed below) apply and provide otherwise.

 

For U.S. federal income tax purposes, a U.S. Participant will be treated as receiving a distribution in an amount equal to the sum of (i) the fair market value of Common Shares acquired pursuant to the Plan and (ii) any Canadian taxes withheld with respect to the distribution.  For purposes of this paragraph, the “fair market value” of Common Shares so acquired will generally be the average of the high and low sales prices on the dividend payment date as reported by the exchange on which the Common Shares are principally traded, which amount may be higher or lower than the Average Market Price used to determine the number of Common Shares acquired under the Plan.  The distribution will be includable in income by a U.S. Participant as dividend income to the extent such distribution is made out of the current or accumulated earnings and profits of the Corporation as determined under U.S. federal income tax principles. Any such dividend received by non-corporate U.S. Participants will be “qualified dividend income” to such U.S. Participants, provided certain holding period and other requirements (including a requirement that the Corporation is not a passive foreign investment company (a “PFIC”) in the year of the dividend or the preceding year) are satisfied and the Corporation is eligible for benefits under the Tax Convention or Common Shares are readily tradable on an established U.S. securities market.  Qualified dividend income received from the Corporation by a U.S. Participant that is not a corporation, including an individual, will be subject to U.S. federal income tax at preferential rates. Dividends will not be eligible for the dividends received deduction generally allowed to a U.S. corporation on dividends received from a domestic corporation.  Any portion of the distribution in excess of the Corporation’s current and accumulated earnings and profits will first be treated as a tax-free return of capital to the extent of a U.S. Participant’s adjusted tax basis in its Common Shares and will be applied against and reduce such basis on a dollar-for-dollar basis (thereby increasing the amount of gain and decreasing the amount of loss recognized on a subsequent disposition of Common Shares).  To the extent that such distribution exceeds the U.S. Participant’s adjusted tax basis, the distribution will be treated as capital gain, which will be treated as long-term capital gain if such U.S. Participant’s holding period in its Common Shares exceeds one year as of the date of the distribution and otherwise will be short-term capital gain.

 

A U.S. Participant’s tax basis for Common Shares received pursuant to the Plan will equal the fair market value of the Common Shares on the dividend payment date.  A U.S. Participant’s holding period for the Common Shares will begin on the day after the dividend payment date.

 

A U.S. Participant will not realize any taxable income upon the receipt of certificates for whole shares that were credited to the U.S. Participant’s account upon withdrawal from or termination of the Plan.  A U.S. Participant will generally recognize gain or loss upon the sale or exchange of Common Shares and upon receipt of cash payments for fractional shares credited to their accounts upon withdrawal from or termination of the Plan.  The amount of such gain equal to the difference (if any) between (i) the U.S. dollar value of the amount realized for Common Shares or fraction thereof and (ii) the U.S. Participant’s adjusted tax basis in the Common Shares.  Such gain or loss will be capital gain or loss and will be long-term capital gain or loss if the U.S. Participant’s holding period for the Common Shares is more than one

 

23

 

year at the time of the sale or exchange.  Capital gains of non-corporate taxpayers on assets held for more than one year are generally subject to preferential rates.  The deductibility of capital losses is subject to limitations. Any gain or loss recognized by a U.S. Participant will generally be treated as U.S. source gain or loss for foreign tax credit limitation purposes.  Each U.S. Participant should consult its own tax advisor with respect to the tax treatment of the receipt of certificates and cash in lieu of fractional shares upon withdrawal from or termination of the Plan.

 

Passive Foreign Investment Company Status

 

A non-U.S. entity treated as a corporation for U.S. federal income tax purposes will be a PFIC for any taxable year in which, after taking into account the income and assets of the corporation and certain subsidiaries, either (1) at least 75 percent of its gross income is “passive” income or (2) at least 50 percent of the average value of its assets is attributable to assets that produce passive income or are held for the production of passive income.

 

Based on its current operation, the Corporation believes that it was not a PFIC in 2014 and is not expected to be a PFIC for 2015 or for any subsequent taxable year.  However, PFIC status is fundamentally factual in nature, generally cannot be determined until the close of the taxable year in question and is determined annually.  Consequently, there is no assurance that the Corporation will not become a PFIC for any taxable year during which a U.S. Participant holds Common Shares.

 

If the Corporation were classified as a PFIC, for any year during which a U.S. Participant owns Common Shares (regardless of whether the Corporation continues to be a PFIC), the U.S. Participant would be subject to special adverse rules, including taxation at maximum ordinary income rates plus an interest charge on both gains on sale and certain dividends, unless the U.S. Participant makes an election to be taxed under an alternative regime.  In addition, any dividends paid by a PFIC would not be qualifying dividends, and would not be eligible for the preferential rate that applies to certain dividends received by U.S. Participants that are not corporations.

 

Certain elections may be available to a U.S. Participant if the Corporation were classified as a PFIC.  The Corporation will provide U.S. Participant with information concerning the potential availability of such elections if the Corporation determines that it is or will become a PFIC.

 

Foreign Currency Gains

 

Taxable dividends with respect to Common Shares that are paid in Canadian dollars will be included in the gross income of a U.S. Participant as translated into U.S. dollars calculated by reference to the exchange rate prevailing on the date of actual or constructive receipt of the dividend, regardless of whether the Canadian dollars are converted into U.S. dollars at that time. The amount realized upon the sale, exchange or other taxable disposition of Common Shares will generally be based on the U.S. dollar value of the Canadian dollars received on the settlement date of the disposition.  If the Canadian dollars received are not converted into U.S. dollars on the date of receipt, a U.S. Participant will have a basis in the Canadian dollars equal to its U.S. dollar value on the date of receipt. Any U.S. Participant that receives payment in Canadian dollars and engages in a subsequent conversion or other disposition of the Canadian dollars may have a foreign currency exchange gain or loss that will be treated as ordinary income or loss, and generally will be U.S. source income or loss for foreign tax credit purposes.

 

Foreign Tax Credits

 

Any tax withheld by Canadian taxing authorities with respect to distributions on, or proceeds from disposition of, Common Shares may, subject to a number of complex limitations, be claimed as a foreign tax credit against a U.S. Participant’s U.S. federal income tax liability or may be claimed as a deduction for U.S. federal income tax purposes. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. For this purpose, dividends distributed with respect to Common Shares will be foreign-source income and will be “passive category income” or “general category income” for purposes of computing the foreign tax credit allowable to a U.S. Participant, and

 

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gain recognized on the sale of Common Shares will generally be treated as U.S. source for such purposes. Because of the complexity of those limitations, each U.S. Participant should consult its own tax advisor with respect to the amount of foreign taxes that may be claimed as a credit.

 

Additional Tax on Passive Income

 

U.S. Holders that are individuals, estates or trusts and whose income exceeds certain thresholds generally will be subject to a 3.8% tax on unearned income, including, among other things, dividends on, and capital gains from the sale or other taxable disposition of, the Common Shares, subject to certain limitations and exceptions.

 

U.S. Information Reporting and Backup Withholding

 

Under some circumstances, a U.S. Participant may be subject to U.S. information reporting and backup withholding tax on distributions paid on Common Shares or from the disposition of Common Shares. Information reporting and backup withholding will not apply, however, to a U.S. Participant that is a corporation or is otherwise exempt from information reporting and backup withholding and, when required, demonstrates this fact. Backup withholding also will not apply to a U.S. Participant that furnishes a correct taxpayer identification number and certifies on a Form W-9 or successor form, under penalty of perjury, that it is not subject to backup withholding, and otherwise complies with applicable requirements of the backup withholding rules. A U.S. Participant that fails to provide the correct taxpayer identification number on Form W-9 or successor form may be subject to penalties imposed by the IRS. Backup withholding, currently at a 28% rate, is not an additional tax, and any amount withheld under these rules will be allowed as a refund or credit against a U.S. Participant’s U.S. federal income tax liability if the required information is timely furnished to the IRS.

 

Certain U.S. Participants who are individuals and who hold certain specified foreign assets in excess of $50,000 may be required to report information relating to Common Shares, subject to certain exceptions (including an exception for Common Shares held in accounts maintained by certain financial institutions). U.S. Participants are urged to consult their tax advisors regarding their reporting requirements.

 

DESCRIPTION OF COMMON SHARES TO BE REGISTERED

 

The Common Shares to be offered by this prospectus will be offered to our shareholders pursuant to participation in the Plan.  The Common Shares are currently listed on the TSX and the NYSE.

 

The holders of Common Shares are entitled to one vote for each such share at all meetings of shareholders except meetings at which only holders of another class or series of shares are entitled to vote.  Subject to the prior rights of the holders of Preferred Shares (see “ — Limitations on Rights of Shareholders Arising From Other Cenovus Securities”), holders of Common Shares are entitled to receive any dividends declared by the directors on the Common Shares and are entitled to receive our remaining property in the event of our dissolution.

 

The following table sets forth the price ranges of the Common Shares on the NYSE and the TSX through February 17, 2015:

 

			TSX(1) Common Shares				NYSE(1) Common Shares
			High		Low		High		Low
			CDN$		CDN$		US$		US$
2009
	November, 2009		32.00		26.37		26.00		24.50
	December, 2009		27.99		24.68		25.75		23.37

 

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			TSX(1) Common Shares				NYSE(1) Common Shares
			High		Low		High		Low
			CDN$		CDN$		US$		US$
2010
	First Quarter 2010		27.84		24.26		26.79		22.87
	Second Quarter 2010		30.63		25.83		30.66		23.84
	Third Quarter 2010		31.00		26.19		30.12		24.61
	Fourth Quarter 2010		33.40		28.31		33.37		27.78
	Full Year 2010		33.40		24.26		33.37		22.87
2011
	First Quarter 2011		38.90		31.15		40.06		31.11
	Second Quarter 2011		38.98		31.73		40.73		32.48
	Third Quarter 2011		38.38		29.87		40.61		29.02
	Fourth Quarter 2011		37.11		28.85		37.35		27.15
	Full Year 2011		38.98		28.85		40.73		27.15
2012
	First Quarter 2012		39.64		33.24		39.81		32.45
	Second Quarter 2012		36.68		30.09		37.26		28.83
	Third Quarter 2012		36.25		30.37		37.31		30.20
	Fourth Quarter 2012		35.69		31.82		36.11		31.74
	Full Year 2012		39.64		30.09		39.81		28.83
2013
	First Quarter 2013		34.13		31.09		34.50		30.58
	Second Quarter 2013		32.08		28.32		31.58		27.25
	Third Quarter 2013		32.77		28.98		31.60		28.00
	Fourth Quarter 2013		31.69		29.33		30.34		27.60
	Full Year 2013		34.13		28.32		34.50		27.25
2014
	First Quarter 2014		32.02		28.25		28.96		25.52
	Second Quarter 2014		34.70		30.80		32.44		28.35
	Third Quarter 2014		34.79		29.77		32.64		26.57
	Fourth Quarter 2014		30.13		18.72		26.89		16.11
	Full Year 2014		34.79		18.72		32.64		16.11
2015
	January 2015		24.95		21.87		20.84		17.37
	February 2015 (through February 17, 2015		26.42		23.03		21.12		18.56

 

(1)         Common shares of Cenovus began trading on a “when issued” basis on the TSX and NYSE stock exchanges on November 2, 2009.  Regular trading of the Cenovus shares began on the TSX on December 3, 2009 and on the NYSE on December 9, 2009.

 

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EXPENSES*

 

The expenses in connection with the issuance and distribution of the Common Shares being offered are as follows:

 

Securities and Exchange Commission Registration Fee		US$	27,274.26
Legal Fees and Expenses		US$	32,500
Blue Sky Fees and Expenses		US$	0
Stock Exchange Listing Fees		US$	46,000
Printing Fees		US$	0
Total		US$	105,774.26

 

*Estimated

 

LIMITATIONS ON RIGHTS OF SHAREHOLDERS ARISING
FROM OTHER CENOVUS SECURITIES

 

We are authorized to issue an unlimited number of Common Shares, an unlimited number of First Preferred Shares and an unlimited number of Second Preferred Shares (the First Preferred Shares and Second Preferred Shares, collectively, the “Preferred Shares”).  Information regarding the number of Common Shares and Preferred Shares authorized and issued is contained in the notes to our Consolidated Financial Statements incorporated in this prospectus by reference to our Annual Report on Form 40-F.

 

Preferred Shares may be issued in one or more series.  The Board may determine the designation, rights, privileges, restrictions and conditions attached to each series of Preferred Shares before the issue of such series.  Holders of the Preferred Shares are not entitled to vote at any meeting of the shareholders of the Corporation, but may be entitled to vote if the Corporation fails to pay dividends on that series of Preferred Shares.  The First Preferred Shares are entitled to priority over the Second Preferred Shares and the Common Shares of the Corporation with respect to the payment of dividends and the distribution of assets of the Corporation in the event of any liquidation, dissolution or winding up of the Corporation’s affairs.  The Board is restricted from issuing First Preferred Shares or Second Preferred Shares if by doing so the aggregate amount payable to holders of each such class of shares as a return of capital in the event of liquidation, dissolution or winding up or any other distribution of our assets among our shareholders for the purpose of winding up our affairs would exceed C$500 million.

 

INDEMNIFICATION

 

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the Corporation pursuant to the applicable provisions of the Canada Business Corporations Act and our by-laws, the Corporation has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

 

LEGAL MATTERS

 

The validity of the Common Shares being offered by this prospectus will be passed upon for us by Bennett Jones LLP, Calgary, Alberta.  Bennett Jones LLP has, in addition, reviewed the statements made herein as to matters of Canadian tax law and as to the enforceability in Canada of liabilities under the federal securities laws of the United States.  The statements made in this prospectus as to matters of United States law have been reviewed for us by Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York.

 

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PART II

 

INFORMATION NOT REQUIRED IN PROSPECTUS

 

Item 8.         Indemnification of Directors and Officers

 

Under Section 124 of the Canada Business Corporations Act (the “CBCA”), Cenovus Energy Inc. (“Cenovus”) may indemnify a present or former director or officer of Cenovus or another individual who acts or acted at Cenovus’ request as a director or officer, or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with Cenovus or other entity. Cenovus may not indemnify an individual unless the individual acted honestly and in good faith with a view to the best interests of Cenovus, or, as the case may be, to the best interests of the other entity for which the individual acted as a director or officer or in a similar capacity at Cenovus’ request and in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the individual had reasonable grounds for believing that the individual’s conduct was lawful. The indemnification may be made in connection with a derivative action only with court approval. The aforementioned individuals are entitled to indemnification from Cenovus as a matter of right if they were not judged by the court or other competent authority to have committed any fault or omitted to do anything that the individual ought to have done. Cenovus may advance moneys to a director, officer or other individual for the costs, charges and expenses of an aforementioned proceeding; however, the individual shall repay the moneys if the individual does not fulfill the conditions set out above.

 

The by-laws of Cenovus provide that, subject to the limitations contained in the CBCA, but without limit to the right of Cenovus to indemnify any person under the CBCA or otherwise, Cenovus shall indemnify a director or officer of Cenovus, a former director or officer of Cenovus or another individual who acts or acted at Cenovus’ request as a director or officer, or an individual acting in a similar capacity, of another entity, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by the individual in respect of any civil, criminal, administrative, investigative or other proceeding in which the individual is involved because of that association with Cenovus or other entity, if the individual acted honestly and in good faith with a view to the best interests of Cenovus, or, as the case may be, to the best interests of the other entity for which the individual acted as director or officer or in a similar capacity at Cenovus’ request, and in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the individual had reasonable grounds for believing that the individual’s conduct was lawful.

 

The by-laws of Cenovus provide that Cenovus may, subject to the limitations contained in the CBCA, purchase, maintain, or participate in insurance for the benefit of a director or officer of Cenovus, a former director or officer of Cenovus, or another individual who acts or acted at Cenovus’ request as a director or officer, or an individual acting in a similar capacity, of another entity, as the Board may from time to time determine.

 

Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the “Securities Act”), may be permitted to directors, officers or persons controlling Cenovus pursuant to the foregoing provisions, Cenovus has been informed that in the opinion of the U.S. Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

 

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Item 9.         Exhibits

 

Item		Exhibit
4.1		Amended and Restated Shareholder Rights Plan Agreement, dated as of April 25, 2012, between Cenovus Energy Inc. and Computershare Trust Company of Canada (incorporated by reference to Exhibit 99.10 to the Amendment No. 1 to the Form 40-F filed with the Securities and Exchange Commission on May 16, 2012) (File No. 1-34513).
4.2		Dividend Reinvestment Plan, dated April 21, 2010 (incorporated by reference to exhibit 4.2 of the Form F-3D filed with the Securities and Exchange Commission on April 30, 2010) (File No. 333-166419).
5.1		Opinion of Bennett Jones LLP as to the legality of the securities being registered.
8.1		Opinion of Bennett Jones LLP regarding Canadian tax matters (contained in Exhibit 5.1).
8.2		Opinion of Paul, Weiss, Rifkind, Wharton & Garrison LLP regarding U.S. tax matters.
23.1		Consent of PricewaterhouseCoopers LLP.
23.2		Consent of GLJ Petroleum Consultants Ltd.
23.3		Consent of McDaniel & Associates Consultants Ltd.
23.6		Consent of Bennett Jones LLP (contained in Exhibit 5.1).
23.7		Consent of Paul, Weiss, Rifkind, Wharton & Garrison LLP (contained in Exhibit 8.2).
24.1		Powers of Attorney (included on the signature pages to this Registration Statement).

 

Item 10.                                                  Undertakings

 

(a)                                 The undersigned Registrant hereby undertakes:

 

(1)                                 To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

 

(i)                                     To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

 

(ii)                                  To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement.  Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate

 

II-2

 

offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement.

 

(iii)                               To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

 

Provided, however, That:

 

(A)                               Paragraphs (a)(1)(i) and (a)(1)(ii) of this section do not apply if the registration statement is on Form S-8, and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Exchange Act that are incorporated by reference in the registration statement; and

 

(B)                               Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the registration statement is on Form S-3 or Form F-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Exchange Act that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

 

(C)                               Provided further, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the registration statement is for an offering of asset-backed securities on Form S-1 or Form S-3, and the information required to be included in a post-effective amendment is provided pursuant to Item 1100(c) of Regulation AB.

 

(2)                                 That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

(3)                                 To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

 

(4)                                 If the registrant is a foreign private issuer, to file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A of Form 20-F at the start of any delayed offering or throughout a continuous offering.  Financial statements and information otherwise required by Section 10(a)(3) of the Act need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements.  Notwithstanding the foregoing, with respect to registration statements on Form F-3, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Act or Section 210.3-19 of this chapter if such financial statements and information are contained in periodic reports filed with or furnished to the

 

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Commission by the registrant pursuant to section 13 or section 15(d) of the Exchange Act that are incorporated by reference in the Form F-3.

 

(5)                                 That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

 

(i)                                     If the registrant is relying on Rule 430B:

 

(A)                               Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

 

(B)                               Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of 314 securities in the offering described in the prospectus.  As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.  Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or

 

(ii)                                  If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness.  Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

 

(6)                             That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:

 

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The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

 

(i)                                     Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

 

(ii)                                  Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

 

(iii)                               The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

 

(iv)                              Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

 

(b)                                 The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

(c)                                  The undersigned registrant hereby undertakes to deliver or cause to be delivered with the prospectus, to each person to whom the prospectus is sent or given, the latest annual report to security holders that is incorporated by reference in the prospectus and furnished pursuant to and meeting the requirements of Rule 14a-3 or Rule 14c-3 under the Exchange Act; and, where interim financial information required to be presented by Article 3 of Regulation S-X are not set forth in the prospectus, to deliver, or cause to be delivered to each person to whom the prospectus is sent or given, the latest quarterly report that is specifically incorporated by reference in the prospectus to provide such interim financial information.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Calgary, Province of Alberta, Canada, on February 18, 2015.

 

	CENOVUS ENERGY INC.
	By:	/s/ Brian C. Ferguson
		Name:	Brian C. Ferguson
		Title:	President & Chief Executive Officer
	By:	/s/ Ivor M. Ruste
		Name:	Ivor M. Ruste
		Title:	Executive Vice-President & Chief Financial Officer

 

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AUTHORIZED REPRESENTATIVE

 

Pursuant to the requirements of Section 6(a) of the Securities Act of 1933, the Authorized Representative has duly caused this Registration Statement to be signed on its behalf by the undersigned, solely in its capacity as the duly authorized representative of Cenovus Energy Inc. in the United States, on February 18, 2015.

 

 

	CENOVUS DOWNSTREAM SERVICES LLC
	By:	/s/ Larry A Hofstetter
		Name:	Larry A. Hofstetter
		Title:	President

 

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