Exhibit 4.6
AGENCY AGREEMENT
October 27, 2003
Strategic Energy Fund
Strategic Energy Management Corp.
Sentry Select Capital Corp.
2850, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Chairman and Chief Executive Officer
Dear Sirs:
Re: Offering of Units of Strategic Energy Fund
First Associates Investments Inc., National Bank Financial Inc., TD
Securities Inc., Canaccord Capital Corporation, HSBC Securities (Canada) Inc.,
Desjardins Securities Inc., Dundee Securities Corporation, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Ltd.,
FirstEnergy Capital Corp. and Research Capital Corporation (the "Agents")
understand that Strategic Energy Fund (the "Fund") proposes to issue and sell
a minimum of 2,500,000 and a maximum of 10,000,000 Units (as herein defined)
(the "Firm Units").
Subject to the terms and conditions hereof, the Fund hereby appoints
the Agents as, and the Agents hereby severally, and not jointly, agree to act
as, the sole and exclusive agents of the Fund, on a commercially reasonable
efforts basis, to obtain subscriptions for the purchase of Firm Units at the
Closing Time (as herein defined) at $8.00 per Firm Unit and the Fund agrees to
issue the Firm Units so subscribed for in accordance with the terms and
conditions of this agreement; provided that, for greater certainty, the Agents
shall not be obligated as principals to subscribe for or purchase any of the
Firm Units not otherwise subscribed for. The Agents shall be entitled in
connection with the offer and sale of the Firm Units to retain as sub-agents
other registered securities dealers. The fee payable to such sub-agents shall
be for the account of the Agents.
The Fund hereby grants to the Agents an option (the "Over-Allotment
Option") to purchase from the Fund, at the Agents' election, up to that number
of Trust Units equal to 15% of the Firm Units issued on the Closing Date (the
"Over-Allotment Units") exercisable at any time and from time to time until
5:00 p.m. (Toronto time) on the date which is 60 days following the Closing
Date for the purpose of covering over-allotments, if any, at the purchase
price of $8.00 per Unit.
1. Definitions
In this agreement:
(a) "Additional Closing Date" and "Additional Closing Time" have
the meanings ascribed thereto in subsection 13(b);
(b) "Agents' counsel" means Stikeman Elliott LLP or such other
legal counsel as the Agents, with the consent of the Fund,
may appoint;
(c) "Applicable Securities Laws" means all applicable Canadian
securities, rules, regulations, notices and policies in the
Qualifying Provinces;
(d) "Assets" means the investments and other assets of the Fund
as described in the Prospectuses;
(e) "Business Day" means a day which is not Saturday or Sunday
or a legal holiday in the City of Toronto, Ontario;
(f) "Closing Date" means November 6, 2003 or such other date as
may be agreed to by the Agents and the Fund, but in any
event, prior to December 26, 2003;
(g) "Closing Time" means 8:45 a.m. (Toronto time) or such other
time, on the Closing Date, as the Agents and the Fund may
agree;
(h) "Credit Agreement" means loan agreement entered into on
October 10, 2003 between the Fund and a Canadian chartered
bank in connection with the Credit Facility;
(i) "Credit Facility" means a 364-day revolving term credit
facility established by a Canadian Chartered bank in favour
of the Fund in the principal amount of $4 million;
(j) "Custodian Agreement" means the custodian agreement dated
April 11, 2002 between the Manager, on behalf of the Fund
and Computershare Trust Company of Canada;
(k) "Exchange" means the Toronto Stock Exchange;
(l) "Fund Assets" means, collectively, the investments of the
Fund and cash;
(m) "Fund's auditors" means Deloitte & Touche LLP, chartered
accountants, Toronto, Ontario;
(n) "Fund's counsel" means ▇▇▇▇▇▇▇ and ▇▇▇▇ LLP or such other
legal counsel as the Fund, with the consent of the Agents,
may appoint;
(o) "Fund Financial Statements" means the audited statements of
net assets and investment portfolio of the Fund as at
December 31, 2002 and the statements of operations, net
realized gain on sale of investments, changes in net assets
and financial highlights of the Fund for the period from May
9, 2002 to December 31, 2002 and the notes thereto and the
unaudited statements of net assets of the Fund as at June
30, 2003and the statements of operations, net realized gain
on sale of investments, changes in net assets and financial
highlights of the Fund for the six month period ended June
30, 2003 and the comparative prior period;
(p) "Investment Advisor" means Sentry Select Capital Corp.;
(q) "Investment Advisory Agreement" means the investment
advisory agreement dated as of April 11, 2002, as amended as
of October 22, 2002, among the Manager, the Investment
Advisor and the Trustee, on behalf of the Fund;
(r) "Manager" means Strategic Energy Management Corp., a
corporation incorporated under the OBCA;
(s) "Management Agreement" means the management agreement dated
April 11, 2002 between the Manager and the Fund, pursuant to
which the Manager manages the Fund;
(t) "Material Agreements" means, collectively, the Trust
Agreement, the Management Agreement, the Custodian
Agreement, the Investment Advisory Agreement and the
Unanimous Shareholder Agreement;
(u) "NI 43-201" means National Instrument 43-201 of the Canadian
Securities Administrators, as amended or replaced;
(v) "OBCA" means the Business Corporations Act (Ontario),
including the regulations promulgated thereunder;
(w) "Offered Units" means, collectively, the Firm Units and the
Over-Allotment Units;
(x) "OSC" means the Ontario Securities Commission;
(y) "Preliminary Prospectus" means the preliminary prospectus of
the Fund dated September 25, 2003 and any amendments
thereto, in respect of the distribution of the Offered
Units, in the English and French languages;
(z) "Prospectus" means the (final) prospectus of the Fund and
any amendments thereto, in respect of the distribution of
the Offered Units, in the English and French languages;
(aa) "Prospectuses" means, collectively, the Preliminary
Prospectus and the Prospectus;
(bb) "Public Record" means all information filed by or on behalf
of the Fund, including without limitation, the Fund
Financial Statements, the Prospectus, any Supplementary
Material and any other information filed with any Securities
Commission in compliance, or intended compliance, with any
Applicable Securities Laws;
(cc) "Qualifying Provinces" means each of the provinces and
territories of Canada;
(dd) "Securities Commissions" means the securities commissions or
similar regulatory authorities in the Qualifying Provinces;
(ee) "Selling Dealer Group" means the dealers and brokers other
than the Agents who participate in the offer and sale of the
Offered Units pursuant to this agreement;
(ff) "Supplementary Material" means, collectively, any amendment
to the Preliminary Prospectus or Prospectus, any amended or
supplemented Preliminary Prospectus or Prospectus or any
ancillary material, information, evidence, return, report,
application, statement or document which may be filed by or
on behalf of the Fund with respect to the distribution of
the Offered Units under the Applicable Securities Laws;
(gg) "Tax Act" means the Income Tax Act (Canada) and the
regulations thereunder;
(hh) "Trustee" means Computershare Trust Company of Canada, as
trustee of the Fund;
(ii) "Trust Agreement" means the amended and restated trust
agreement dated as of October 10, 2003, pursuant to which
the Fund is governed;
(jj) "Unanimous Shareholder Agreement" means the agreement dated
April 11, 2002 among Petro Assets Inc., the Trustee, on
behalf of the Fund, and the Manager, as amended as of
October 22, 2002;
(kk) "United States" means the United States of America, its
territories and possessions, any state of the United States
and the District of Columbia;
(ll) "Unitholders" means the holders from time to time of Units;
(mm) "Units" means trust units of the Fund, each unit
representing an equal fractional undivided beneficial
interest in the Fund;
and "misrepresentation", "material change" and "material fact" shall have the
meanings ascribed thereto under the Applicable Securities Laws of the
Qualifying Provinces, "distribution" means "distribution" or "distribution to
the public", as the case may be, as defined under the Applicable Securities
Laws of the Qualifying Provinces and "distribute" has a corresponding meaning.
2. Agents' Commission
In consideration for their services in acting as agents in respect of
the distribution of and sale of the Offered Units, the Fund agrees to pay the
Agents: (a) at the Closing Time a commission of $0.54 per Offered Unit for
each Offered Unit subscribed for and issued by the Fund pursuant to this
Agreement (being an aggregate of $168,750 in respect of the minimum number of
Offered Units and $675,000 in respect of the maximum number of Offered Units);
and (b) at the Additional Closing Time a commission of $0.54 per
Over-Allotment Unit purchased.
The foregoing commission (the "Agents' Commission") may, at the sole
option of the Agents, be deducted from the aggregate gross proceeds of the
sale of the Offered Units and withheld for the account of the Agents. In the
event that Canada Customs and Revenue Agency determines that Goods and
Services Tax provided for in the Excise Tax Act (Canada) is exigible on the
Agents' Commission, the Fund agrees to pay the amount of Goods and Services
Tax forthwith upon the request of the Agents. The Fund also agrees to pay the
Agents' expenses as set forth in section 10.
3. Qualification for Sale
(a) The Fund shall:
(i) not later than October 1, 2003, have:
(A) prepared and filed the Preliminary
Prospectus (in the English and French
languages) and other documents required
under the Applicable Securities Laws with
the Securities Commissions and designated
the OSC as the principal regulator; and
(B) obtained a preliminary MRRS decision
document from the OSC, evidencing that a
receipt has been issued for the
Preliminary Prospectus in each Qualifying
Province;
(ii) forthwith after any comments with respect to the
Preliminary Prospectus have been received from the
Securities Commissions, but not later than October
28, 2003 (or such later date as may be agreed to in
writing by the Fund, the Manager and the Agents),
have:
(A) prepared and filed the Prospectus (in the
English and French languages) and other
documents required under the Applicable
Securities Laws with the Securities
Commissions; and
(B) obtained a final MRRS decision document
from the OSC, evidencing that a receipt
has been issued for the Prospectus in each
Qualifying Province, or otherwise obtained
a receipt for the Prospectus from each of
the Securities Commissions;
and otherwise fulfilled all legal requirements to
enable the Offered Units to be offered and sold to
the public in each of the Qualifying Provinces
through the Agents or any other investment dealer
or broker registered in the applicable Qualifying
Province and who complies with the relevant
provisions of the Applicable Securities Laws; and
(iii) until the completion of the distribution of the
Offered Units, promptly take all additional steps
and proceedings that from time to time may be
required under the Applicable Securities Laws in
each Qualifying Province to continue to qualify the
Offered Units for distribution or, in the event
that the Offered Units have, for any reason, ceased
to so qualify, to again qualify the Offered Units
for distribution.
(b) Prior to the filing of the Prospectuses and, during the
period of distribution of the Offered Units, prior to the
filing with any Securities Commissions of any Supplementary
Material, the Fund shall have allowed the Agents and the
Agents' counsel to participate fully in the preparation of,
and to approve the form of, such documents and to have
reviewed any documents incorporated by reference therein.
(c) During the period from the date hereof until completion of
the distribution of the Offered Units, the Fund shall allow
the Agents to conduct all due diligence which they may
reasonably require in order to fulfil their obligations as
underwriters and in order to enable the Agents responsibly
to execute the certificates required to be executed by them
in the Prospectuses or in any Supplementary Material.
(d) The Fund shall take or cause to be taken all such other
steps and proceedings, including fulfilling all legal,
regulatory and other requirements, as required under
Applicable Securities Laws to qualify the Offered Units for
distribution to the public in the Qualifying Provinces.
4. Delivery of Prospectus and Related Documents
The Fund shall deliver or cause to be delivered without charge to the
Agents and the Agents' counsel the documents set out below at the respective
times indicated:
(a) prior to or contemporaneously, as nearly as practicable,
with the filing with the Securities Commissions of each of
the Preliminary Prospectus and the Prospectus copies of the
Preliminary Prospectus and the Prospectus, each in the
English and French languages, signed as required by the
Applicable Securities Laws of the Qualifying Provinces;
(b) as soon as they are available, copies of any Supplementary
Material, in the English and French languages, as required,
signed as required by the Applicable Securities Laws;
(c) prior to the filing of the Prospectus with the Securities
Commissions, a "comfort letter" from the Fund's auditors,
dated the date of the Prospectus, addressed to the Agents
and reasonably satisfactory in form and substance to the
Agents and the Agents' counsel, to the effect that they have
carried out certain procedures performed for the purposes of
comparing certain specified financial information and
percentages appearing in the Prospectus and the documents
incorporated therein by reference with indicated amounts in
the financial statements or accounting records of the Fund
and have found such information and percentages to be in
agreement, which comfort letter shall be based on the Fund's
auditors review having a cut-off date of not more than two
Business Days prior to the date of the Prospectus;
(d) at the respective times of delivery to the Agents of the
Preliminary Prospectus and the Prospectus, the Fund shall
deliver to the Agents:
(i) an opinion of local counsel in Quebec, addressed to
the Agents and the Agents' counsel and dated at the
date of the filing of the Preliminary Prospectus
and the Prospectus, respectively, in form
acceptable to the Agents and the Agents' counsel,
acting reasonably, to the effect that, except for
information in the Prospectus translated by each of
the Fund's auditors, the French language version of
such document is in all material respects a
complete and proper translation of the English
language versions thereof and is not susceptible to
any materially different interpretation with
respect to any material matter contained therein;
and
(ii) an opinion from the Fund's auditors, addressed to
the Agents and the Agents' counsel and dated the
date of the filing of the Preliminary Prospectus
and the Prospectus, respectively, in form
acceptable to the Agents and the Agents' counsel,
acting reasonably, to the effect that the
information excepted from the opinion of counsel
referred to in subsection 4(d)(i) in the French
language version of such document is in all
material respects a complete and proper translation
of the information contained in the English
language versions thereof and is not susceptible to
any materially different interpretation with
respect to any material matter contained therein.
Opinions and comfort letters similar to the foregoing shall be
provided to the Agents with respect to any Supplementary Material and any
other relevant document at the time the same is presented to the Agents for
their signature or, if the Agents' signature is not required, at the time the
same is filed. All such letters shall be in form and substance acceptable to
the Agents and the Agents' counsel, acting reasonably.
The deliveries referred to in subsections 4(a) and (b) shall also
constitute the Fund's consent to the use by the Agents and other members of
the Selling Dealer Group of the Prospectuses and any Supplementary Material in
connection with the offering and sale of the Offered Units.
5. Commercial Copies
(a) The Fund shall, as soon as possible but in any event not
later than noon (local time at the place of delivery) on the
second Business Day following the date of the filing of the
Preliminary Prospectus or the Prospectus, as the case may
be, with the Securities Commissions and no later than noon
(local time) on the second Business Day after the execution
of any Supplementary Material in connection with the
Prospectuses cause to be delivered to the Agents, without
charge, commercial copies of the Preliminary Prospectus, the
Prospectus or such Supplementary Material (in both English
and French languages as required by applicable law) in such
numbers and in such cities as the Agents may reasonably
request by oral or written instructions to the Fund or the
printer thereof given no later than the time when the Fund
authorizes the printing of the commercial copies of such
documents.
6. Material Change
(a) During the period of distribution of the Offered Units, the
Fund and the Manager will promptly inform the Agents of the
full particulars of:
(i) any material change (actual, anticipated or
threatened) in or affecting the business,
operations, capital, properties, assets,
liabilities (absolute, accrued, contingent or
otherwise), condition (financial or otherwise) or
results of operations of the Fund or the Manager;
(ii) any change in any material fact contained or
referred to in the Preliminary Prospectus, the
Prospectus or any Supplementary Material; and
(iii) the occurrence of a material fact or event, which,
in any such case, is, or may be, of such a nature
as to:
(A) render the Preliminary Prospectus, the
Prospectus or any Supplementary Material
untrue, false or misleading in any
material respect;
(B) result in a misrepresentation in the
Preliminary Prospectus, the Prospectus or
any Supplementary Material; or
(C) result in the Preliminary Prospectus, the
Prospectus or any Supplementary Material
not complying in any material respect with
the Applicable Securities Laws,
provided that if the Fund or the Manager are uncertain as to
whether a material change, change, occurrence or event of
the nature referred to in this paragraph has occurred, the
Fund and the Manager shall promptly inform the Agents of the
full particulars of the occurrence giving rise to the
uncertainty and shall consult with the Agents as to whether
the occurrence is of such nature.
(b) During the period of distribution of the Offered Units, the
Fund and the Manager shall promptly inform the Agents of the
full particulars of:
(i) any request of any Securities Commission for any
amendment to the Preliminary Prospectus, the
Prospectus or any other part of the Public Record
or for any additional information;
(ii) the issuance by any Securities Commission or
similar regulatory authority, the Exchange or any
other competent authority of any order to cease or
suspend trading of any securities of the Fund or of
the institution or threat of institution of any
proceedings for that purpose; and
(iii) the receipt by the Fund or the Manager of any
communication from any Securities Commission or
similar regulatory authority, the Exchange or any
other competent authority relating to the
Preliminary Prospectus, the Prospectus, any other
part of the Public Record or the distribution of
the Offered Units.
(c) The Fund and the Manager will promptly comply to the
reasonable satisfaction of the Agents and the Agents'
counsel with Applicable Securities Laws with respect to any
material change, change, occurrence or event of the nature
referred to in subsections 6(a) or (b) above and the Fund
and the Manager will prepare and file promptly at the
Agents' request any amendment to the Prospectus or
Supplementary Material as may be required under Applicable
Securities Laws; provided that the Fund and the Manager
shall have allowed the Agents and the Agents' counsel to
participate fully in the preparation of any Supplementary
Material, and conduct all due diligence investigations which
the Agents may reasonably require in order to fulfill their
obligations as underwriters and in order to enable the
Agents responsibly to execute the certificate required to be
executed by them in, or in connection with, any
Supplementary Material, such approval not to be unreasonably
withheld and to be provided in a timely manner. The Fund
shall further promptly deliver to each of the Agents and the
Agents' counsel a copy of each Supplementary Material in the
English and French languages as filed with the Securities
Commissions, and of opinions and letters with respect to
each such Supplementary Material substantially similar to
those referred to in section 4 above.
(d) During the period of distribution of the Offered Units, the
Fund will promptly provide to the Agents, for review by the
Agents and the Agents' counsel, prior to filing or issuance:
(i) any financial statement of the Fund or the Manager;
(ii) any proposed document, including without limitation
any new annual information form, material change
report, interim report, or information circular,
intended to be filed as part of the Public Record;
and
(iii) any press release of the Fund.
7. Representations and Warranties of the Fund and the Manager
(a) Each delivery of the Prospectus pursuant to section 4 above
shall constitute a joint and several representation and
warranty to the Agents by each of the Fund and the Manager
(and each of the Fund and the Manager hereby acknowledges
that each of the Agents is relying on such representations
and warranties in entering into this agreement) that:
(i) the Preliminary Prospectus, the Prospectus or any
Supplementary Material, as applicable, as the case
may be:
(A) are at the respective dates of such
documents, true and correct in all
material respects;
(B) contain no misrepresentation; and
(C) contain full, true and plain disclosure of
all material facts relating to the Fund
and the Offered Units;
(other than any information or statement relating
solely to the Agents and furnished to the Fund by
the Agents expressly for inclusion in the
Preliminary Prospectus or Prospectus);
(ii) the Preliminary Prospectus, the Prospectus, or any
Supplementary Material, as applicable, complies in
all material respects with the Applicable
Securities Laws; and
(iii) except as is disclosed in the Public Record, there
has been no intervening material change (actual,
proposed or prospective, whether financial or
otherwise), from the date of the Preliminary
Prospectus, the Prospectus and any Supplementary
Material to the time of delivery thereof, in the
business, operations, capital, properties, assets,
liabilities (absolute, accrued, contingent or
otherwise), condition (financial or otherwise) or
results of operations of the Fund.
(b) In addition to the representations and warranties contained
in subsection (a) hereof, each of the Fund and the Manager
jointly and severally represents and warrants to the Agents,
to the extent that the following representations and
warranties relate to them and acknowledges that each of the
Agents is relying upon such representations and warranties
in entering into this agreement and the Investment Advisor
represents and warrants to the Agents to the extent the
following representations and warranties relate to it, and
acknowledges that each of the Agents is relying upon such
representations and warranties in entering into this
agreement, that:
(i) the Fund has been properly created and is a
subsisting trust under the laws of the Province of
Ontario and has all requisite trust authority and
power to carry on its business as described in the
Prospectuses including, without limitation, to
perform its obligations under the Material
Agreements to which it is a party and to own and
administer its properties and assets including,
without limitation, the Fund Assets;
(ii) each of the Manager and the Investment Advisor has
been duly incorporated and organized and is valid
and subsisting in good standing under the laws of
its jurisdiction of incorporation, or formation as
the case may be, and has all requisite authority
and power to carry on its business as described in
the Prospectuses and to own, lease and operate its
properties and assets as described in the
Prospectuses including, without limitation, to
perform its obligations under the Material
Agreements to which it is a party;
(iii) each of the Manager and the Investment Advisor is
qualified to carry on business and is validly
subsisting under the laws of each jurisdiction in
which it carries on its business and the Fund is
qualified to carry on its activities including,
without limitation, owning the Fund Assets in each
jurisdiction where it carries on such activities;
(iv) neither the Fund nor the Manager has any
subsidiaries (as defined in the OBCA), and neither
the Fund nor the Manager is "affiliated" with or a
"holding corporation" of any body corporate (within
the meaning of those terms in the OBCA);
(v) the Fund is a "unit trust" and a "mutual fund
trust" under the Tax Act and the Fund shall at all
times conduct its affairs so as to continue to
qualify as a "unit trust" and a "mutual fund
trust", including by limiting its activities to
investing the property of the Fund in the Fund
Assets and other property in which a "mutual fund
trust" is permitted by the Tax Act to invest, and
will not carry on any other business;
(vi) the Fund has full power and authority to issue the
Firm Units and the Over-Allotment Units and to
grant the Over-Allotment Option and, at the Closing
Date, the Firm Units and at the Additional Closing
Date, the Over-Allotment Units will be duly and
validly authorized, allotted and reserved for
issuance and, upon receipt of the purchase price
therefor, will be duly and validly issued as fully
paid and non-assessable;
(vii) none of the Fund, the Manager and the Investment
Advisor is in default or breach of, and the
execution and delivery of, and the performance of
and compliance with the terms of this agreement by
the Fund, the Manager and the Investment Advisor
and the transactions contemplated hereby does not
and will not result in any breach of, or constitute
a default under, and does not and will not create a
state of facts which, after notice or lapse of time
or both, would result in a breach of or constitute
a default under, the Trust Agreement, any term or
provision of the articles, by-laws or resolutions
of the Fund, the Manager or the Investment Advisor,
or any indenture, mortgage, note, contract,
agreement (written or oral), instrument, lease or
other document including, without limitation, any
Material Agreement to which the Fund, the Manager
or the Investment Advisor is a party or by which
any of the Fund, the Manager or the Investment
Advisor is bound, or any judgment, decree, order,
statute, rule or regulation applicable to the Fund,
the Manager or the Investment Advisor, which
default or breach might reasonably be expected to
materially adversely affect the business,
operations, capital, properties, assets,
liabilities (absolute, accrued, contingent or
otherwise), condition (financial or otherwise) or
results of operations of the Fund, the Manager or
the Investment Advisor;
(viii) there is not in any of the Material Agreements or
in any agreement, mortgage, note, debenture,
indenture or other instrument or document to which
the Fund or the Manager is a part of by which the
Fund or the Manager may be bound, any provision
which imposes any restriction upon or impediment to
the declaration or payment of distributions by the
Fund to holders of Units other than as set out
under the Credit Agreement;
(ix) each of the Fund, the Manager and the Investment
Advisor has full trust or corporate power and
authority to enter into this agreement and to
perform its obligations set out herein and this
agreement has been duly authorized, executed and
delivered by the Fund, the Manager and the
Investment Advisor and this agreement is a legal,
valid and binding obligation of the Fund, the
Manager and the Investment Advisor enforceable
against the Fund, the Manager and the Investment
Advisor in accordance with its terms subject to the
general qualifications that:
(A) enforceability may be limited by
bankruptcy, insolvency or other laws
affecting creditors' rights generally; and
(B) equitable remedies, including the remedies
of specific performance and injunctive
relief, are available only in the
discretion of the applicable court;
(x) the Manager has the authority to enter into this
agreement and to execute and deliver, on behalf of
the Fund, all other necessary documents in
connection with the offering of the Offered Units
and the Over-Allotment Units;
(xi) there has not been any material change in the
capital, assets, liabilities or obligations
(absolute, accrued, contingent or otherwise) of the
Fund from the position set forth in the most recent
Fund Financial Statements except as disclosed in or
contemplated by the Prospectuses and there has not
been any adverse material change in the business,
operations, capital, properties, assets,
liabilities (absolute, accrued, contingent or
otherwise), condition (financial or otherwise) or
results of operations of the Fund since June 30,
2003 except as disclosed in the Prospectuses; and
since that date there have been no material facts,
transactions, events or occurrences which could
materially adversely affect the business,
operations, capital, properties, assets,
liabilities (absolute, accrued, contingent or
otherwise), condition (financial or otherwise) or
results of operations of the Fund which have not
been disclosed in the Prospectuses;
(xii) the Fund Financial Statements fairly present, in
accordance with generally accepted accounting
principles in Canada, consistently applied, the
financial position and condition, the results of
operations, cash flows and the other information
purported to be shown therein of the Fund as at the
dates thereof and for the periods then ended and
reflect all assets, liabilities and obligations
(absolute, accrued, contingent or otherwise) of the
Fund as at the dates thereof required to be
disclosed by generally accepted accounting
principles in Canada, and include all adjustments
necessary for a fair presentation;
(xiii) the pro forma financial statements, including the
notes thereto, of the Fund contained in the
Prospectuses have been prepared in accordance with
Canadian generally accepted accounting principles,
consistently applied, have been prepared and
presented in accordance with Applicable Securities
Laws, and include all adjustments necessary for a
fair presentation; and such statements provide a
reasonable basis for the compilation of the pro
forma financial statements and such pro form
financial statements, accurately reflect such
assumptions;
(xiv) no authorization, approval or consent of any court
or governmental authority or agency is required to
be obtained by the Fund or the Manager in
connection with the sale and delivery of the
Offered Units hereunder, except such as may be
required under the Applicable Securities Laws and
by the rules of the Exchange;
(xv) there are no actions, suits, proceedings or
inquiries pending or (as far as they are aware)
threatened against or affecting the Fund, the
Manager or the Investment Advisor at law or in
equity or before or by any federal, provincial,
municipal or other governmental department,
commission, board, bureau, agency or
instrumentality which in any way materially
adversely affects, or may in any way materially
adversely affect, the business, operations,
capital, properties, assets, liabilities (absolute,
accrued, contingent or otherwise), condition
(financial or otherwise) or results of operations
of the Fund or the Manager, which affect of may
affect the performance by the Fund, the Manager or
the Investment Advisor of their obligations
hereunder or under any of the Material Agreements
or which affects or may affect the distribution of
the Offered Units;
(xvi) each of the Fund and the Manager has conducted and
is conducting its business in all material respects
in compliance with all applicable laws, rules and
regulations of each jurisdiction in which it
carries on business and holds all material
licences, registrations and qualifications in all
jurisdictions in which it carries on business
necessary to carry on its business as now conducted
and as contemplated to be conducted in the
Prospectuses, including, without limitation,
performing its obligations under the Material
Agreements, if any, to which it is a party;
(xvii) each of the Material Agreements is a legal, valid
and binding obligation of the respective parties
thereto enforceable against such parties in
accordance with its terms subject to the general
qualifications that:
(A) enforceability may be limited by
bankruptcy, insolvency or other laws
affecting creditors' rights generally; and
(B) equitable remedies, including the remedies
of specific performance and injunctive
relief, are available only in the
discretion of the applicable court; and
each of the Fund, the Manager and the Investment
Advisor, as applicable, are in material compliance
with the terms of such Material Agreements and none
of the Fund, the Manager or the Investment Advisor
is aware of any default or breach of a material
nature under any of such Material Agreements by any
other party thereto;
(xviii) the authorized capital of the Fund consists of an
unlimited number of Units of which 2,129,876 Units
are issued and outstanding;
(xix) no person holds any securities convertible into or
exchangeable for Units or has any agreement,
warrant, option, right or privilege being or
capable of becoming an agreement, warrant, option
or right for the acquisition of any unissued Units
or other securities of the Fund;
(xx) no Securities Commission, stock exchange or similar
regulatory authority has issued any order
preventing or suspending trading in any securities
of the Fund and no proceedings, investigations or
inquiries for such purpose are pending or
contemplated or (as far as the Fund or the Manager
are aware) threatened;
(xxi) the Investment Advisor is duly registered under
Applicable Securities Laws as required to fulfil
its obligations to the Manager under the Material
Agreements to which it is a party, and there are no
actions, proceedings, or investigations pending or
to its knowledge threatened against or affecting,
which could materially affect its registration and
and/or its ability to fulfil its obligations to the
Manager;
(xxii) Computershare Trust Company of Canada at its
principal office in the cities of Calgary and
Toronto, is the duly appointed registrar and
transfer agent of the Fund with respect to its
Units;
(xxiii) the minute books of the Fund and the Manager are
true and correct and at the Closing Date will
contain the minutes of all meetings and all
resolutions of the trustees and of the directors,
shareholders and Unitholders of the Fund and the
Manager;
(xxiv) other than as provided for in this agreement,
neither the Fund nor the Manager has incurred any
obligation or liability (absolute, accrued,
contingent or otherwise) for brokerage fees,
finder's fees, agent's commission or other similar
forms of compensation with respect to the
transactions contemplated herein;
(xxv) the issued and outstanding Units are listed and
posted for trading on the Exchange;
(xxvi) the Fund is a "reporting issuer" or has equivalent
status within the meaning of the Applicable
Securities Laws in each of the provinces and
territories of Canada and is not in default of any
material requirement of the Applicable Securities
Laws in any material respect;
(xxvii) the definitive form of certificates for the Units
is in due and proper form under the laws governing
the Fund and in compliance with the requirements of
the Exchange;
(xxviii) subject to liens, charges, encumbrances and
security interests of any nature or kind in favour
of the lender under the Credit Facility, the Fund
has good and marketable title to the Fund Assets,
free and clear of all liens, charges, encumbrances
and security interests of any nature or kind, save
as disclosed in the Prospectuses;
(xxix) the Manager has the necessary power and authority
to execute and deliver the Prospectuses on behalf
of the Fund and all requisite action has been taken
by the Manager to authorize the execution and
delivery by it of the Prospectuses on behalf of the
Fund;
(xxx) the attributes and characteristics of the Offered
Units conform in all material respects to the
attributes and characteristics thereof described in
the Prospectuses; and
(xxxi) with such exceptions as are not material to the
Fund (taken as a whole), the Fund has duly and on a
timely basis filed all tax returns required to be
filed by it, has paid all taxes due and payable by
it and has paid all assessments and reassessments
and all other taxes, governmental charges,
penalties, interest and other fines due and payable
by it and which were claimed by any governmental
authority to be due and owing and adequate
provision has been made for taxes payable for any
completed fiscal period for which tax returns are
not yet required and there are no agreements,
waivers, or other arrangements providing for an
extension of time with respect to the filing of any
tax return or payment of any tax, governmental
charge or deficiency by the Fund and to the best of
the knowledge, information and belief of the Fund
and the Manager there are no actions, suits,
proceedings, investigations or claims threatened or
pending against the Fund in respect of taxes,
governmental charges or assessments or any matters
under discussion with any governmental authority
relating to taxes, governmental charges or
assessments asserted by any such authority.
(c) Certain Additional Covenants
The Manager and the Fund hereby jointly and severally covenant and
agree as follows:
(i) unless otherwise directed or authorized by the
Unitholders, to use their best efforts to:
(A) monitor all aspects of the Fund's affairs
relevant to its continuing qualification
as a unit trust and a mutual fund trust
for purposes of the Income Tax Act
(Canada), and will promptly notify First
Associates Investments Inc. upon its
becoming aware of any circumstance that
may cause the Fund to fail to continue to
so qualify;
(B) monitor the level of ownership of Units
held by persons who are not resident in
Canada and notify holders of Units in the
manner contemplated by the Trust Agreement
and the Agents as provided herein upon its
becoming aware that:
(1) more than 40% of the issued and
outstanding Units are held by or
for the benefit of persons who
are not resident in Canada or
circumstances exist that may
reasonably be anticipated to
result in such holding; or
(2) a governmental body has proposed
to change the Income Tax Act
(Canada) or any other applicable
legislation in a manner which
reasonably could be expected to
have a material adverse effect on
the tax consequences to holders
of Units, including without
limiting the foregoing, any
change or proposed change whereby
the Units may cease to be
eligible investments not
constituting "foreign property"
for any of the various deferred
income plans provided for by the
Income Tax Act (Canada) or
whereby amounts allocated to
Unitholders with respect to the
Fund's income cease to be
deductible by it;
(C) the Fund will at all times conduct its
affairs so as to continue to enable the
Fund to qualify as a mutual fund trust and
a unit trust under the Income Tax Act
(Canada) and, in particular, the Fund will
not carry on any business and will
restrict its activities such that its only
undertaking will be the investing of its
funds in property in which a unit trust
and a mutual fund trust are permitted by
the Income Tax Act (Canada) to invest; and
(ii) to duly, punctually and faithfully do and perform
all the obligations to be performed by them under
all Material Agreements to which they are a party
and all such other things which they represent in
the Prospectus will be done by either of them
(including, without limitation, make all such
elections, filings and distributions).
8. Indemnity
(a) Each of the Fund and the Manager, jointly and severally,
shall indemnify and save the Agents, and each of the Agents'
affiliates, agents, directors, officers, shareholders and
employees harmless against and from all liabilities, claims,
demands, losses (other than losses of profit in connection
with the distribution of the Offered Units or remuneration
or other costs of personnel), costs (including, without
limitation, reasonable legal fees and disbursements actually
incurred), damages and expenses to which the Agents, or any
of the Agents' affiliates, agents, directors, officers,
shareholders or employees may be subject or which the
Agents, or any of the Agents' agents, directors, officers,
shareholders or employees may suffer or incur, whether under
the provisions of any statute or otherwise, in any way
caused by, or arising directly or indirectly from or in
consequence of:
(i) any information or statement contained in the
Preliminary Prospectus, the Prospectus, any
Supplementary Material or in any other document or
material filed or delivered in respect of the
distribution of the Offered Units (other than any
information or statement relating solely to the
Agents and furnished to the Fund by the Agents
expressly for inclusion in the Preliminary
Prospectus or Prospectus) which is or is alleged to
be untrue or any omission or alleged omission to
provide any information or state any fact (other
than any information or fact relating solely to the
Agents) the omission of which makes or is alleged
to make any such information or statement untrue or
misleading in light of the circumstances in which
it was made;
(ii) any misrepresentation or alleged misrepresentation
(except a misrepresentation which is based upon
information relating solely to the Agents and
furnished to the Fund by the Agents expressly for
inclusion in the Preliminary Prospectus or
Prospectus) contained in the Preliminary
Prospectus, the Prospectus or any Supplementary
Materials;
(iii) any prohibition or restriction of trading in the
securities of the Fund or any prohibition or
restriction affecting the distribution of the
Offered Units imposed by any competent authority if
such prohibition or restriction is based on any
misrepresentation or alleged misrepresentation of a
kind referred to in subsection 8(a)(ii);
(iv) any order made or any inquiry, investigation
(whether formal or informal) or other proceeding
commenced or threatened by any one or more
competent authorities (not based upon the
activities or the alleged activities of the Agents
or their banking or Selling Dealer Group members,
if any) prohibiting, restricting, relating to or
materially affecting the trading or distribution of
the Offered Units during the period of the
distribution of the Offered Units; or
(v) any breach of, default under or non-compliance by
the Fund or the Manager with any requirements of
the Applicable Securities Laws or the by-laws,
rules or regulations of the Exchange in connection
with the distribution of the Offered Units or any
representation, warranty, term or condition of this
agreement or in any certificate or other document
delivered by or on behalf of the Fund or the
Manager hereunder or pursuant hereto;
provided, however, no indemnified person entitled to
indemnification hereunder who has engaged in any fraud,
wilful misconduct, fraudulent misrepresentation or
negligence shall be entitled, to the extent that the
liabilities, claims, losses, costs, damages or expenses were
caused by or resulted from such activity, to claim
indemnification from any person who has not engaged in such
fraud, wilful misconduct, fraudulent misrepresentation or
negligence (provided that, for greater certainty, the
foregoing shall not disentitle an Agent from claiming
indemnification hereunder to the extent that the negligence,
if any, relates to the Agent's failure to conduct adequate
"due diligence").
(b) If any claim contemplated by subsection 8(a) shall be
asserted against any of the persons or corporations in
respect of which indemnification is or might reasonably be
considered to be provided for in such paragraph, such person
or corporation (the "Indemnified Person") shall notify the
Fund and the Manager (collectively the "Indemnifying
Parties") (provided that failure to so notify the
Indemnifying Parties of the nature of such claim in a timely
fashion shall relieve the Indemnifying Parties of liability
hereunder only if and to the extent that such failure
materially prejudices the Indemnifying Parties) as soon as
possible of the nature of such claim and the Indemnifying
Parties shall be entitled (but not required) to assume the
defence of any claim, proceeding, investigation or suit
brought to enforce such claim, provided however, that the
defence shall be through legal counsel selected by the
Indemnifying Parties and acceptable to the Indemnified
Person acting reasonably and that no settlement or admission
of liability may be made by the Indemnifying Parties or the
Indemnified Person without the prior written consent of the
other, such consent not to be unreasonably withheld or
delayed and the Indemnifying Parties shall not be liable for
any settlement made without their consent. The Indemnified
Person shall have the right to retain its own counsel in any
proceeding relating to a claim contemplated by subsection
8(a) if:
(i) the Indemnified Person has been advised by counsel
that there may be a reasonable legal defense
available to the Indemnified Person which is
different from or additional to a defense available
to an Indemnifying Party and that representation of
the Indemnified Person and any one or more of the
Indemnifying Parties by the same counsel would be
inappropriate due to the actual or potential
differing interests between them (in which case the
Indemnifying Parties shall not have the right to
assume the defense of such proceedings on the
Indemnified Person's behalf);
(ii) the Indemnifying Parties shall not have taken the
defense of such proceedings and employed counsel
within ten (10) days after notice has been given to
the Indemnifying Parties of commencement of such
proceedings; or
(iii) the employment of such counsel has been authorized
by the Indemnifying Parties in connection with the
defense of such proceedings;
and, in any such event, the reasonable fees and expenses of
such Indemnified Person's counsel (on a solicitor and his
client basis) shall be paid by the Indemnifying Parties,
provided that the Indemnifying Parties shall not, in
connection with any one such action or separate but
substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more
than one separate law firm for all such Indemnified Persons.
(c) Each of the Indemnifying Parties hereby waives its rights to
recover contribution from the Agents with respect to any
liability of the Indemnifying Party by reason of or arising
out of any misrepresentation in the Preliminary Prospectus,
the Prospectus and any Supplementary Material provided,
however, that such waiver shall not apply in respect of
liability caused or incurred by reason of any
misrepresentation which is based upon information relating
solely to the Agents contained in such document and
furnished to the Fund by the Agents expressly for inclusion
in the Preliminary Prospectus, the Prospectus or any
Supplementary Material.
(d) If any legal proceedings shall be instituted against an
Indemnifying Party in respect of the Preliminary Prospectus,
the Prospectus or any Supplementary Material or if any
regulatory authority or stock exchange shall carry out an
investigation of an Indemnifying Party in respect of the
Preliminary Prospectus, the Prospectus or any Supplementary
Material and, in either case, any Indemnified Person is
required to testify, or respond to procedures designed to
discover information, in connection with or by reason of the
services performed by the Agents hereunder, the Indemnified
Persons may employ their own legal counsel and the
Indemnifying Parties shall pay and reimburse the Indemnified
Persons for the reasonable fees, charges and disbursements
actually incurred of such legal counsel, the other expenses
reasonably incurred by the Indemnified Persons in connection
with such proceedings or investigation and its reasonable
fees at the normal per diem rate for any director, officer
or employee of the Agents involved in the preparation for or
attendance at such proceedings or investigation if such
Indemnified Person is not found liable and/or guilty
pursuant to such legal proceedings or investigation or other
proceeding or investigation relating to the same matter.
(e) The rights and remedies of the Indemnified Persons set forth
in sections 8, 9 and 10 hereof are to the fullest extent
possible in law cumulative and not alternative and the
election by any Underwriter or other Indemnified Person to
exercise any such right or remedy shall not be, and shall
not be deemed to be, a waiver of any other rights and
remedies.
(f) The Indemnifying Parties hereby acknowledge that the Agents
are acting as agents for the Agents' respective affiliates,
agents, directors, officers, shareholders and employees
under this section 8 and under section 9 with respect to all
such affiliates, agents, directors, officers, shareholders
and employees.
(g) The Indemnifying Parties waive any right they may have of
first requiring an Indemnified Person to proceed against or
enforce any other right, power, remedy or security or claim
or to claim payment from any other person before claiming
under this indemnity. It is not necessary for an Indemnified
Person to incur expense or make payment before enforcing
such indemnity.
(h) The rights of indemnity contained in this section 8 shall
not apply if the Indemnifying Parties have complied with the
provisions of sections 3 and 4 and the person asserting any
claim contemplated by this section 8 was not provided with a
copy of the Prospectus or any amendment to the Prospectus or
other document which corrects any misrepresentation or
alleged misrepresentation which is the basis of such claim
and which was required, under Applicable Securities Laws, to
be delivered to such person by the Agents.
(i) If the Indemnifying Parties have assumed the defense of any
claim, proceeding, investigation or suit brought to enforce
a claim hereunder, the Indemnified Person shall provide the
Indemnifying Parties copies of all documents and information
in its possession pertaining thereto, take all reasonable
actions necessary to preserve its rights to object to or
defend against the claim, consult and reasonably cooperate
with the Indemnifying Parties in determining whether the
claim and any legal proceeding resulting therefrom should be
resisted, compromised or settled and reasonably cooperate
and assist in any negotiations to compromise or settle, or
in any defense of, a claim undertaken by the Indemnifying
Parties, including without limitation the provision of
documents and appropriate officers and employees to give
witness statements, attend examinations for discovery, make
affidavits, meet with counsel, testify and divulge all
information reasonably required to defend or prosecute the
proceedings.
9. Contribution
In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this agreement is
due in accordance with its terms but is, for any reason, held by a court to be
unavailable from one or more of the Indemnifying Parties on grounds of policy
or otherwise, the Indemnifying Parties and the party or parties seeking
indemnification shall contribute to the aggregate liabilities, claims,
demands, losses (other than losses of profit in connection with the
distribution of the Offered Units), costs (including, without limitation,
reasonable legal fees and disbursements actually incurred), damages and
expenses to which they may be subject or which they may suffer or incur:
(a) in such proportion as is appropriate to reflect the relative
benefit received by the Indemnifying Parties on the one
hand, and by the Agents on the other hand, from the offering
of the Offered Units; or
(b) if the allocation provided by subsection 9(a) above is not
permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits
referred to in subsection 9(a) above but also to reflect the
relative fault of the Agents on the one hand, and the
Indemnifying Parties, on the other hand, in connection with
the statements, commissions or omissions or other matters
which resulted in such liabilities, claims, demands, losses,
costs, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Indemnifying Parties, on the
one hand, and the Agents, on the other hand, shall be deemed to be in the same
proportion that the total proceeds of the offering received by the
Indemnifying Parties (net of fees but before deducting expenses) bear to the
fees received by the Agents. In the case of liability arising out of the
Preliminary Prospectus, the Prospectus or any Supplementary Material, the
relative fault of the Indemnifying Parties, on the one hand, and of the
Agents, on the other hand, shall be determined by reference, among other
things, to whether the statement, omission, misrepresentation or alleged
misrepresentation, order, inquiry, investigation or other matter or thing
referred to in section 8 relates to information supplied or which ought to
have been supplied by, or steps or actions taken or done on behalf of or which
ought to have been taken or done on behalf of, one or more of the Indemnifying
Parties or the Agents and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement, omission,
misrepresentation or alleged misrepresentation, order, inquiry, investigation
or other matter or thing referred to in section 8.
The amount paid or payable by an Indemnified Person as a result of
liabilities, claims, demands, losses (other than losses of profit in
connection with the distribution of the Offered Units), costs, damages and
expenses (or claims, actions, suits or proceedings in respect thereof)
referred to above shall, without limitation, include any legal or other
expenses reasonably incurred by the Indemnified Person in connection with
investigating or defending such liabilities, claims, demands, losses, costs,
damages and expenses (or claims, actions, suits or proceedings in respect
thereof) whether or not resulting in any action, suit, proceeding or claim.
Each of the Indemnifying Parties and the Agents agree that it would
not be just and equitable if contributions pursuant to this agreement were
determined by pro rata allocation or by any other method of allocation which
does not take into account the equitable considerations referred to in the
immediately preceding paragraphs. The rights to contribution provided in this
section 9 shall be in addition to, and without prejudice to, any other right
to contribution which the Agents or other Indemnified Persons may have.
Any liability of the Agents under this section 9 shall be limited to
the amount actually received by the Agents under section 2.
10. Expenses
Whether or not the transactions contemplated herein shall be
completed, all costs and expenses (including applicable goods and services
tax) of or incidental to the transactions contemplated hereby including,
without limitation, those relating to the distribution of the Offered Units
shall be borne by the Fund including, without limitation, all costs and
expenses of or incidental to the preparation, filing, reproduction (including
the commercial copies thereof) and translation of the Preliminary Prospectus,
the Prospectus, any Supplementary Material and the "greensheet" and the
delivery thereof to the Agents, the fees and expenses of the Fund's counsel,
the fees and expenses of agent counsel retained by the Fund or the Fund's
counsel, the reasonable fees and disbursements of the Agents' counsel, the
other out-of-pocket reasonable expenses of the Agents, the fees and expenses
of the Fund's transfer agent, auditors, engineers and other outside
consultants, all stock exchange listing fees, the cost of preparing record
books for all of the parties to this agreement and their respective counsel
and all other costs and expenses relating to this transaction.
11. Termination
(a) The Agents, or any of them, may, without liability,
terminate their obligations hereunder, by written notice to
the Fund, in the event that after the date hereof and at or
prior to the Closing Time:
(i) any order to cease or suspend trading in any
securities of the Fund or prohibiting or
restricting the distribution of any of the Offered
Units, is made, or proceedings are announced,
commenced or threatened for the making of any such
order, by any securities commission or similar
regulatory authority, the Exchange or any other
competent authority, and has not been rescinded,
revoked or withdrawn;
(ii) there should occur or commence, or be announced or
threatened, any inquiry, action, suit,
investigation or other proceeding (whether formal
or informal) in relation to the Fund, the Manager
or the Investment Advisor; or any order is issued
by any governmental authority or exchange; or any
law or regulation is promulgated, changed or
announced; or any change or proposed change in the
income tax laws of Canada or the interpretation or
administration thereof occurs or is announced or
threatened; which in the opinion of the Agents or
any one of them, acting reasonably, is expected to
materially adversely affect the trading in or the
distribution of the Offered Units or any other
securities of the Fund or would be expected to have
a material adverse effect on the market price or
value of the Units or other securities of the Fund;
(iii) there shall have occurred any material adverse
change, as determined by the Agents or any one of
them, acting reasonably, in the senior management
of the Manager or the Investment Advisor, or in the
business, operations, capital or condition
(financial or otherwise), business prospects,
properties, assets, liabilities or obligations
(absolute, accrued, contingent or otherwise) of the
Fund, the Manager or the Investment Advisor which
in the Agents' opinion, could reasonably be
expected to have a significant adverse effect on
the market price or value of the Offered Units or
the investment quality or marketability of the
Offered Units;
(iv) there should develop, occur or come into effect or
existence any event, action, state, condition or
major financial occurrence of national or
international consequence, any law or regulation,
or any other occurrence of any nature whatsoever,
which, in the opinion of the Agents or any one of
them, acting reasonably, seriously adversely
affects, or involves, or will seriously adversely
affect, or involve, the financial markets or the
business, operations or affairs of the Fund, the
Manager or the Investment Advisor, or the state of
the financial markets is such that the Offered
Units cannot, in the opinion of the Agents, be
successfully marketed;
(v) the Agents shall become aware of any adverse
material change with respect to the Fund, the
Manager or the Investment Advisor which had not
been publicly disclosed in writing to the Agents at
or prior to the date hereof; or
(vi) the Fund, the Manager or the Investment Advisor
shall be in breach or default under or
non-compliance with any representation, warranty,
term or condition of this agreement, in any
material respect.
(b) The Agents, or any of them, may exercise any or all of the
rights provided for in subsection 11(a) or section 12 or 16
notwithstanding any material change, change, event or state
of facts and (except where the Agent(s) purporting to
exercise any of such rights is in breach of its obligations
under this agreement) notwithstanding any act or thing taken
or done by the Agents or any inaction by the Agents, whether
before or after the occurrence of any material change,
change, event or state of facts including, without
limitation, any act of the Agents related to the offering or
continued offering of the Offered Units for sale and any act
taken by the Agents in connection with any amendment to the
Prospectus (including the execution of any amendment or any
other Supplementary Material) and the Agents shall only be
considered to have waived or be estopped from exercising or
relying upon any of their rights under or pursuant to
subsection 11(a) or section 12 or 16 if such waiver or
estoppel is in writing and specifically waives or estops
such exercise or reliance.
(c) Any termination pursuant to the terms of this agreement
shall be effected by notice in writing delivered to the
Fund, provided that no termination shall discharge or
otherwise affect any obligation of the Fund or the Manager
under section 8, 9 or 10. The rights of the Agents to
terminate their obligations hereunder are in addition to,
and without prejudice to, any other remedies they may have.
(d) If an Agent elects to terminate its obligation to purchase
the Offered Units as aforesaid, whether the reason for such
termination is within or beyond the control of the Fund or
the Manager, the liability of the Fund or the Manager
hereunder shall be limited to the indemnity referred to in
section 8, the contribution rights referred to in section 9
and the payment of expenses referred to in section 10.
12. Closing Documents
The obligations of the Agents hereunder, as to the Offered Units to
be purchased at the Closing Time shall be conditional upon all representations
and warranties and other statements of the Fund and the Manager herein being,
at and as of the Closing Time, true and correct in all material respects, the
Fund and the Manager having performed in all material respects, at the Closing
Time, all of their obligations hereunder theretofore to be performed, the
Agents due diligence review not revealing any material adverse information or
fact which is not currently generally known to the public which would, in the
Agents' reasonable opinion, seriously adversely affect the value or market
price of the Units or the investment quality or marketability of the Units and
the Agents receiving at the Closing Time:
(a) favourable legal opinions of the Fund's counsel and the
Agents' counsel addressed to the Agents, in form and
substance reasonably satisfactory to the Agents, with
respect to such matters as the Agents may reasonably request
relating to the offering of the Offered Units, the Fund and
the Manager and the transactions contemplated hereby,
including, without limitation, that:
(i) the Fund is valid and existing as a trust under the
laws of the Province of Ontario and having the
Trustee as its trustee;
(ii) the Fund has the capacity and power to own and
lease its properties and assets and to conduct its
business as described in the Prospectuses;
(iii) the Manager has been duly incorporated, is validly
subsisting and has all requisite corporate power
and authority to carry on its business as now
conducted by it and to own its properties and
assets and is qualified to carry on business under
the laws of the jurisdictions where it carries on a
material portion of its business;
(iv) each of the Fund and the Manager has all necessary
trust or corporate power and authority to enter
into this agreement and to perform its obligations
set out herein, and this agreement has been duly
authorized, executed and delivered by the Fund and
the Manager, respectively, and constitutes a legal,
valid and binding obligation of each of the Fund
and the Manager enforceable against the Fund and
the Manager in accordance with its terms subject to
laws relating to creditors' rights generally and
except that rights to indemnity and contribution
may be limited or unavailable by applicable law;
(v) the execution and delivery of this agreement and
the fulfilment of the terms hereof by each of the
Fund and the Manager, and the performance of and
compliance with the terms of this agreement by the
Fund and the Manager does not and will not result
in a breach of, or constitute a default under, and
does not create a state of facts which, after
notice or lapse of time or both, will result in a
breach of or constitute a default under, any
federal or Ontario statute, rule or regulation
applicable to the Fund or the Manager term or
provision of the Trust Agreement, the articles,
by-laws or resolutions of the Unitholders or the
directors or shareholders of the Fund or the
Manager, as applicable, or any mortgage, note,
indenture, contract, agreement (written or oral),
instrument, lease or other document to which the
Fund or the Manager is a party or by which it is
bound, of which such counsel is aware including,
without limitation, the Material Agreements;
(vi) that the Manager has the authority to enter into
this agreement on behalf of the Fund and to execute
and deliver all other necessary documents in
connection with the offering of the Offered Units
and the Over-Allotment Units;
(vii) as to the authorized and issued capital of the
Fund;
(viii) the form of the definitive certificate representing
the Units has been approved and adopted by the Fund
and complies with all legal requirements (including
all applicable requirements of the Exchange)
relating thereto;
(ix) the Offered Units have been duly and validly
created, allotted and issued as fully paid and
non-assessable Units of the Fund;
(x) the Fund and the attributes of the Offered Units
conform in all material respects with the
description thereof contained in the Prospectuses;
(xi) all necessary documents have been filed, all
necessary proceedings have been taken and all legal
requirements have been fulfilled as required under
the Applicable Securities Laws of each of the
Qualifying Provinces in order to qualify the
Offered Units for distribution and sale to the
public in each of such Qualifying Provinces by or
through investment dealers and brokers duly
registered under the applicable laws of such
provinces who have complied with the relevant
provisions of such Applicable Securities Laws;
(xii) the Fund is a "reporting issuer" not in default of
any requirement of the Securities Act (Ontario) and
the regulations thereunder and has a similar status
under the Applicable Securities Laws of each of the
other Qualifying Provinces;
(xiii) each of the Fund and the Manager have the necessary
power and authority to execute and deliver the
Prospectuses and all necessary action has been
taken by each of the Fund and the Manager to
authorize the execution and delivery by it of the
Prospectuses and the filing thereof, as the case
may be, in each of the Qualifying Provinces in
accordance with Applicable Securities Laws;
(xiv) subject to the qualifications set out therein, the
statements in the Prospectus under the heading
"Canadian Federal Income Tax Considerations"
constitute a fair summary of the principal Canadian
federal income tax consequences arising under the
Tax Act to persons referred to therein who hold
Offered Units in the manner described therein;
(xv) all laws of the Province of Quebec relating to the
use of the French language have been complied with
in connection with the sale of the Offered Units to
purchasers in the Province of Quebec;
(xvi) the Offered Units are conditionally listed and,
upon notification to the Exchange of the issuance
and sale thereof, will be posted for trading on the
Exchange;
(xvii) Computershare Fund Company of Canada, at its
principal offices in Calgary and Toronto has been
duly appointed the transfer agent and registrar for
the Fund Units (including the Offered Units);
and as to all other legal matters, including compliance with
Applicable Securities Laws in any way connected with the
issuance, sale and delivery of the Offered Units as the
Agents may reasonably request.
It is understood that the respective counsel may rely on the
opinions of local counsel acceptable to them as to matters
governed by the laws of jurisdictions other than where they
are qualified to practice law, and on certificates of
officers of the Fund and the Manager, the transfer agent and
the Fund's auditors as to relevant matters of fact. It is
further understood that the Agents' counsel may rely on the
opinion of the Fund's counsel as to matters which
specifically relate to the Fund, the Manager, the Investment
Advisor and the Units, including the issuance of the Offered
Units;
(b) a certificate of each of the Fund, the Manager and the
Investment Advisor dated the Closing Date, addressed to the
Agents and signed on behalf of the Fund, the Manager and the
Investment Advisor by the Chief Executive Officer and Chief
Operating Officer of the Manager and the Investment Advisor
or such other officers or directors thereof as are
satisfactory to the Agents, acting reasonably, certifying
that:
(i) each of the Fund, the Manager and the Investment
Advisor has complied with and satisfied in all
material respects all terms and conditions of this
agreement on its part to be complied with or
satisfied at or prior to the Closing Time, as
applicable;
(ii) the representations and warranties of the Fund, the
Manager and the Investment Advisor set forth in
this agreement are true and correct in all material
respects at the Closing Time, as if made at such
time; and
(iii) no event of a nature referred to in subsection
11(a)(i), (ii) or (iii) has occurred or to the
knowledge of such officer is pending, contemplated
or threatened;
and the Agents shall have no knowledge to the contrary;
(c) a comfort letter of the Fund's auditors, addressed to the
Agents and dated the Closing Date, as applicable,
satisfactory in form and substance to the Agents, acting
reasonably, bringing the information contained in the
comfort letter or letters referred to in subsection 4(c) up
to the Closing Time, as applicable, which comfort letter
shall be not more than two Business Days prior to the
Closing Date;
(d) evidence satisfactory to the Agents that the Offered Units
have been conditionally listed on the Exchange not later
than the close of business on the last Business Day
preceding the Closing Date and shall be posted for trading
as at the opening of business on the Closing Date; and
(e) such other certificates and documents as the Agents may
request, acting reasonably.
13. Deliveries
(a) The sale of the Firm Units shall be completed at the Closing
Time at the offices of the Fund's counsel in Toronto,
Ontario or at such other place as the Fund and the Agents
may agree. Subject to the conditions set forth in section
12, the Agents, on the Closing Date, shall deliver to the
Fund a certified cheque or bank draft payable to the Fund at
par in Toronto, in the amount of $8.00 in respect of each of
the Firm Units subscribed for against delivery by the Fund
of:
(i) the opinions, certificates and documents referred
to in section 12;
(ii) a book entry certificate representing, in the
aggregate, all of the Firm Units subscribed for
registered in the name of CDS or in such name or
names as the Agents shall notify the Fund in
writing not less than 24 hours prior to the Closing
Time; and
(iii) a certified cheque or bank draft payable to First
Associates Investments Inc. representing the
commission provided for in section 2 in respect of
the Firm Units subscribed for;
or the Agents may, in their discretion, deliver a certified
cheque or bank draft payable to the Fund at par in Toronto
for the net amount of the amount in respect of the Units
referred to above and the amount referred to in (iii) above.
(b) The sale of the Over-Allotment Units, if applicable, shall
be completed at the offices of the Fund's counsel in
Toronto, Ontario or at such other place as the Fund and the
Agents may agree, on the date (the "Additional Closing
Date") and at the time ("Additional Closing Time") specified
by the Agents in the written notice given by the Agents
pursuant to their election to purchase such Over-Allotment
Units (provided that in no event shall such time be earlier
than the Closing Time or earlier than two or later than ten
Business Days after the date of the written notice of the
Agents to the Fund in respect of the Over-Allotment Units),
or at such other time and date as the Agents and the Fund
may agree upon in writing. Subject to the conditions set
forth in section 12, the Agents, at the Additional Closing
Time, shall deliver to the Fund a certified cheque or bank
draft payable to the Fund at par in Calgary, in the amount
of $8.00 per Over-Allotment Unit agreed to be purchased by
the Agents from the Fund pursuant to their exercise of the
Over-Allotment Option, against delivery by the Fund of:
(i) the opinions, certificates and documents referred
to in section 12;
(ii) a book entry certificate representing, in the
aggregate, all of the Over-Allotment Units
subscribed for registered in the name of CDS or in
such name or names as the Agents shall notify the
Fund in writing not less than 24 hours prior to the
Closing Time; and
(iii) a certified cheque or bank draft payable First
Associates Investments Inc. representing the fee
provided for in section 2 in respect of the
Over-Allotment Units purchased.
14. Restrictions on Offerings
The Fund agrees that, prior to 90 days after the Closing Date, it
shall not, directly or indirectly, sell or offer to sell any Units, or
otherwise issue, lend, transfer or dispose of any securities exchangeable,
convertible or exercisable into Units or enter into any swap or other
arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of Units, whether any such transaction is
settled by delivery of Units or other such securities, in cash or otherwise,
or announce any intention to do any of the foregoing, except pursuant to the
reinvestment of distributions by the Fund, without the prior consent of First
Associates Investments Inc. and National Bank Financial Inc., on behalf of the
Agents, which consent may not be unreasonably withheld or delayed.
15. Notices
Any notice or other communication to be given hereunder shall, in the
case of notice to be given to the Fund or the Manager, be addressed to the
Manager, c/o ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, at the above address, Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
2300, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
and, in the case of notice to be given to the Agents, be addressed to:
First Associates Investments Inc.
Bay Wellington Tower, BCE Place
Suite 900, ▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
National Bank Financial Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: L. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
TD Securities Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, TD Tower
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: J. ▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Canaccord Capital Corporation
▇▇▇, ▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
HSBC Securities (Canada) Inc.
▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Desjardins Securities Inc.
2 Complexe ▇▇▇▇▇▇▇▇▇▇
Tour de l'Est, 15th Floor
C.P. 394, succ. Desjardins
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Dundee Securities Corporation
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ Ltd.
▇▇▇▇, ▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
FirstEnergy Capital Corp.
▇▇▇▇, ▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Research Capital Corporation
Ernst & Young Tower
▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Centre, ▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
and a copy to:
Stikeman Elliott LLP
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇ - ▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as the party may designate by notice given to the
other. Each communication shall be personally delivered to the addressee or
sent by facsimile transmission to the addressee, and:
(a) a communication which is personally delivered shall, if
delivered before 4:00 p.m. (local time at the place of
delivery) on a Business Day, be deemed to be given and
received on that day and, in any other case be deemed to be
given and received on the first Business Day following the
day on which it is delivered; and
(b) a communication which is sent by facsimile transmission
shall, if sent on a Business Day before 4:00 p.m. (local
time at the place of receipt), be deemed to be given and
received on that day and, in any other case, be deemed to be
given and received on the first Business Day following the
day on which it is sent.
16. Conditions
All terms, covenants and conditions of this agreement to be performed
by the Fund and the Manager shall be construed as conditions, and any breach
or failure to comply with any material terms and conditions which are for the
benefit of the Agents shall entitle the Agents to terminate their obligations
hereunder, by written notice to that effect given to the Fund prior to the
Closing Time. The Agents may waive in whole or in part any breach of, default
under or non-compliance with any representation, warranty, term or condition
hereof, or extend the time for compliance therewith, without prejudice to any
of their rights in respect of any other representation, warranty, term or
condition hereof or any other breach of, default under or non-compliance with
any other representation, warranty, term or condition hereof, provided that
any such waiver or extension shall be binding on the Agents only if the same
is in writing.
All terms and conditions of this Agreement to be performed by the
Agents shall be construed as conditions, and any breach or failure to comply
with any material terms and conditions shall entitle the Fund to terminate its
obligations to sell the offered Units and the Over-Allotment Units by written
notice to that effect given to the Agents prior to the Closing Date. The Fund
may waive in whole or in part any breach of, default under or non-compliance
with any representation, warranty, term or condition hereof, or extend the
time for compliance therewith, without prejudice to any of their rights in
respect of any other representation, warranty, term or condition hereof or any
other breach of, default under or non-compliance with any other
representation, warranty, term or condition hereof, provided that any such
waiver or extension shall be binding on the Fund only if the same is in
writing.
17. Survival of Representations and Warranties
All representations, warranties, terms and conditions herein
(including, without limitation, those contained in section 7) or contained in
certificates or documents submitted pursuant to or in connection with the
transactions contemplated herein shall survive the payment by the Agents for
the Offered Units, the termination of this agreement and the distribution of
the Offered Units pursuant to the Prospectus and shall continue in full force
and effect for the benefit of the Agents regardless of any investigation by or
on behalf of the Agents with respect thereto, in the case of terms or
conditions and, in the case of representations or warranties for a period of 3
years following the Closing Date.
18. Authority to Bind Agents
The Fund and the Manager shall be entitled to and shall act on any
notice, waiver, extension or communication given by or on behalf of the Agents
by First Associates Investments Inc., which shall represent the Agents and
which shall have the authority to bind the Agents in respect of all matters
hereunder, except in respect of any settlement under section 8 or 9 or any
matter referred to in section 11. While not affecting the foregoing, First
Associates Investments Inc. shall consult with the other Agents with respect
to any such notice, waiver, extension or other communication.
19. Agents Covenants
(a) Each of the Agents covenants and agrees with the Fund that
it will:
(i) conduct activities in connection with the proposed
offer and sale of the Offered Units in compliance
with all the Applicable Securities Laws and cause a
similar covenant to be contained in any agreement
entered into with any Selling Dealer Group
established in connection with the distribution of
the Offered Units;
(ii) not solicit subscriptions for the Offered Units,
trade in Offered Units or otherwise do any act in
furtherance of a trade of Offered Units outside of
the Qualifying Provinces or in other jurisdictions
outside of Canada; and
(iii) as soon as reasonably practicable after the Closing
Date provide the Fund with a breakdown of the
number of Offered Units sold in each of the
Qualifying Provinces and, upon completion of the
distribution of the Offered Units, provide to the
Fund notice to that effect, if required by
Applicable Securities Laws.
(b) For the purposes of this section 19, the Agents shall be
entitled to assume that the Offered Units may be lawfully
offered for sale and sold in the Qualifying Provinces if the
final MRRS decision document has been issued evidencing that
a receipt for the Prospectus has been issued by the
Securities Commissions, provided the Agents do not have
actual knowledge, and have not been notified in writing by
the Fund or the Manager, of any circumstances that would
legally prohibit such distribution.
(c) No Underwriter will be liable to the Fund under this section
19 with respect to a default by any of the other Agents but
will be liable to the Fund only for its own default.
20. Severance
If one or more of the provisions contained herein shall, for any
reason, be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other
provision of this agreement, but this agreement shall be construed as if such
invalid, illegal or unenforceable provision or provisions had never been
contained herein.
21. Relationship Between the Fund, the Manager and the Agents
The Fund and the Manager: (i) acknowledge and agree that the Agents
have certain statutory obligations as registrants under the Applicable
Securities Laws and have fiduciary relationships with their clients; (ii)
acknowledge and agree that the Agents are neither the agents of the Fund or
the Manager nor otherwise fiduciaries of the Fund or the Manager; and (iii)
consent to the Agents acting hereunder while continuing to act for their
clients. To the extent that the Agents' statutory obligations as registrants
under the Applicable Securities Laws or fiduciary relationships with their
clients conflicts with their obligations hereunder the Agents shall be
entitled to fulfil their statutory obligations as registrants under the
Applicable Securities Laws and their duties to their clients. Nothing in this
agreement shall be interpreted to prevent the Agents from fulfilling their
statutory obligations as registrants under the Applicable Securities Laws or
to act as a fiduciary of their clients.
22. Stabilization
In connection with the distribution of the Offered Units, the Agents
may over-allot or effect transactions which stabilize or maintain the market
price of the Units at levels other than those which might otherwise prevail in
the open market, but in each case only as permitted by applicable law. Such
stabilizing transactions, if any, may be discontinued at any time.
23. Governing Law
This agreement shall be governed by and construed in accordance with
the laws of the Province of Ontario and the laws of Canada applicable therein.
Each of the Fund and the Manager and the Agents hereby attorn to the
non-exclusive jurisdiction of the courts of the Province of Ontario.
24. Time of the Essence
Time shall be of the essence of this agreement.
25. Counterpart Execution
This agreement may be executed in one or more counterparts each of
which so executed shall constitute an original and all of which together shall
constitute one and the same agreement. Delivery of counterparts may be
effected by facsimile transmission.
26. Contractual Obligations of Fund
The obligations or liabilities, if any, of the Trustee or the Fund
hereunder shall not be binding upon, nor shall resort be had to the property
of, any of the unitholders of the Fund and such obligations and liabilities
shall not be binding upon such unitholders. The unitholders of the Fund shall
not be subject to any personal liability whatsoever, in tort, contract or
otherwise in connection with the obligations of the Trustee and the Fund
hereunder. The obligations or liabilities, if any, of the Trustee or the Fund
hereunder and any claims arising out of or in connection with this agreement
shall be satisfied only out of the property of the Fund and the property of
the Fund only shall be subject to levy or execution. No resort may be had to
the property of any unitholders. The provisions of this paragraph shall enure
to the benefit of the heirs, successors, assigns and personal representatives
of the unitholders of the Fund and, to the extent necessary to provide
effective enforcement of such provisions, the Trustee is hereby acknowledged
to be acting, and shall be entitled to act as, trustee for the unitholders of
the Fund.
27. Custodian of Subscription Proceeds
First Associates Investments Inc. agrees to act as depositary for the
subscription funds. In the event that the minimum offering of 2,500,000 Units
is not achieved and the necessary consents are not obtained or if the Closing
does not occur for any reason, the First Associates Investments Inc. (or in
the event that an Agent other than First Associates Investments Inc. still
holds such subscription proceeds, such Agent) will return the subscription
proceeds received from the subscribers promptly without interest or deduction,
unless the subscribers have otherwise instructed First Associates Investments
Inc.
28. Further Assurances
Each party to this agreement covenants agrees that, from time to
time, it will, at the request of the requesting party, execute and deliver all
such documents and do all such other acts and things as any party hereto,
acting reasonably, may from time to time request be executed or done in order
to better evidence or perfect or effectuate any provision of this agreement or
of any agreement or other document executed pursuant to this agreement or any
of the respective obligations intended to be created hereby or thereby.
29. Use of Proceeds
Each of the Manager and the Fund hereby covenant and agree to use the
net proceeds of the sale of the Units hereunder in accordance with the
disclosure in the Prospectus.
(Remainder of this page is intentionally left blank.)
30. Entire Agreement
It is understood that the terms and conditions of this agreement
supersede any previous verbal or written agreement between the Agents and the
Fund or the Manager.
If the foregoing is in accordance with your understanding and is
agreed to by you, please confirm your acceptance by signing the enclosed
copies of this letter at the place indicated and by returning the same to
First Associates Investments Inc.
FIRST ASSOCIATES INVESTMENTS INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
NATIONAL BANK FINANCIAL INC.
By: /s/ L. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------
TD SECURITIES INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------
CANACCORD CAPITAL CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
HSBC SECURITIES (CANADA) INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
DESJARDINS SECURITIES INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------
(Executions continue on Page 30)
(Executions continued from Page 29)
DUNDEE SECURITIES CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ LTD.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
--------------------------
FIRSTENERGY CAPITAL CORP.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------
RESEARCH CAPITAL CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
--------------------------
ACCEPTED AND AGREED to as of the ____
day of October, 2003.
STRATEGIC ENERGY FUND by its Manager, STRATEGIC ENERGY MANAGEMENT CORP.
Strategic Energy Management Corp.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------- ----------------------------
SENTRY SELECT CAPITAL CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------