1
Exhibit 10.3
▇▇▇▇▇▇ TECHNOLOGIES, INC.
as ParentCo
and
▇▇▇▇▇▇ CANADA CORPORATION
as Company
and
▇▇▇▇▇▇ CALLCO CORPORATION
as CallCo
and
THE HOLDERS OF EXCHANGEABLE
SHARES OF THE COMPANY
as the Holders
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SUPPORT AGREEMENT
December 16, 1999
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TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS AND INTERPRETATION
Section 1.1 Defined Terms..............................................................................2
Section 1.2 Interpretation Not Affected by Headings, Etc...............................................2
Section 1.3 Number, Gender, Etc........................................................................2
Section 1.4 Date for Any Action........................................................................2
ARTICLE 2
COVENANTS OF PARENTCO AND THE COMPANY
Section 2.1 Covenants of ParentCo Regarding Exchangeable Shares........................................2
Section 2.2 Reservation for Issuance of ParentCo Common Stock..........................................4
Section 2.3 Segregation of Funds.......................................................................5
Section 2.4 Notification of Certain Events.............................................................5
Section 2.5 Delivery of ParentCo Common Stock..........................................................6
Section 2.6 Qualification of ParentCo Common Stock.....................................................6
Section 2.7 Equivalence................................................................................7
Section 2.8 Tender Offers, Etc.........................................................................7
Section 2.9 Due Performance............................................................................7
ARTICLE 3
CERTAIN RIGHTS OF CALLCO TO ACQUIRE EXCHANGEABLE SHARES
Section 3.1 CallCo Liquidation Call Right..............................................................7
Section 3.2 CallCo Redemption Call Right...............................................................9
Section 3.3 Insolvency Exchange Right.................................................................10
ARTICLE 4
PARENTCO SUCCESSORS
Section 4.1 Certain Requirements in Respect of Combination, Etc.......................................11
Section 4.2 Vesting of Powers in Successor............................................................11
Section 4.3 Wholly-owned Subsidiaries.................................................................12
Section 4.4 Execution of Supplemental Agreements......................................................12
ARTICLE 5
GENERAL
Section 5.1 Term......................................................................................12
Section 5.2 Changes in Capital of ParentCo and the Company............................................12
Section 5.3 Encumbrances, Liens.......................................................................13
Section 5.4 Severability..............................................................................13
Section 5.5 Amendments, Modifications, Etc............................................................13
(i)
3
Section 5.6 Ministerial Amendments....................................................................13
Section 5.7 Meeting to Consider Amendments............................................................14
Section 5.8 Amendments Only in Writing................................................................14
Section 5.9 Enurement.................................................................................14
Section 5.10 Waiver....................................................................................14
Section 5.11 Notices to Parties........................................................................14
Section 5.12 Counterparts..............................................................................16
Section 5.13 Jurisdiction..............................................................................16
Section 5.14 Attornment................................................................................16
Section 5.15 Parentco Not To Vote Exchangeable Shares..................................................16
Section 5.16 Ownership of Outstanding Shares...........................................................16
Section 5.17 Obligations of Holders Several............................................................17
Section 5.18 Guaranty / Assignment.....................................................................17
(ii)
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SUPPORT AGREEMENT
Support Agreement dated December 16, 1999, between ▇▇▇▇▇▇ Technologies,
Inc., a corporation organized under the laws of the State of Delaware
("PARENTCO"), the holders of Exchangeable Shares (as hereinafter defined) from
time to time, ▇▇▇▇▇▇ Canada Corporation, an unlimited liability company existing
under the laws of the Province of Nova Scotia (the "COMPANY") and ▇▇▇▇▇▇ CallCo
Corporation, an unlimited liability company existing under the laws of the
Province of Nova Scotia ("CALLCO").
RECITALS:
(a) The authorized share capital of the Company consists of a
maximum of 10,000,000 Common Shares and 100,000,000
Exchangeable Shares.
(b) Pursuant to a Share Purchase Agreement dated as of December
16, 1999, by and between ParentCo, Inlogic Software Inc. and
the holders of all of the issued and outstanding shares of
Inlogic Software, Inc. (such agreement is hereinafter referred
to as the "PURCHASE AGREEMENT") the parties agreed that on the
closing of the transaction contemplated under the Purchase
Agreement, ParentCo and the Company would execute and deliver
a Support Agreement containing the terms and conditions set
forth in an Exhibit to the Purchase Agreement together with
such other terms and conditions as may be agreed to by the
parties to the Purchase Agreement acting reasonably;
(c) Pursuant to the Purchase Agreement, the Company issued certain
exchangeable shares (the "EXCHANGEABLE SHARES") in the capital
of the Company having attached thereto certain rights,
privileges, restrictions and conditions including, without
limitation, the right to exchange each Exchangeable Share for
one share of Common Stock of ParentCo set forth in the
Company's articles ("PARENTCO COMMON STOCK") (collectively,
the "EXCHANGEABLE SHARE PROVISIONS");
(d) The Holders are the registered holders of the Exchangeable
Shares set out on the execution pages and there is no other
shares outstanding in the capital of the Company as at the
date hereof; and
(e) The parties hereto desire to make appropriate provision and to
establish a procedure whereby ParentCo will take certain
actions and make certain payments and deliveries necessary to
ensure that the Company will be able to make certain payments
and to deliver or cause to be delivered ParentCo Common Stock
in satisfaction of the obligations of the Company under the
Exchangeable Share Provisions
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with respect to the payment and satisfaction of dividends,
Liquidation Amounts, Retraction Prices and Redemption Prices,
all in accordance with and as defined in the Exchangeable
Share Provisions.
In consideration of the foregoing and the mutual agreements contained
herein (the receipt and adequacy of which are acknowledged), the parties agree
as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
SECTION 1.1 DEFINED TERMS.
Each term denoted herein by initial capital letters and not otherwise
defined herein shall have the meaning attributed thereto in the Exchangeable
Share Provisions, unless the context requires otherwise.
SECTION 1.2 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.
The division of this Agreement into articles, sections and paragraphs
and the insertion of headings are for convenience of reference only and shall
not affect the construction or interpretation of this Agreement.
SECTION 1.3 NUMBER, GENDER, ETC.
Words importing the singular number only shall include the plural and
vice versa. Words importing the use of any gender shall include all genders.
SECTION 1.4 DATE FOR ANY ACTION.
If any date on which any action is required to be taken under this
agreement is not a Business Day, such action shall be required to be taken on
the next succeeding Business Day.
ARTICLE 2
COVENANTS OF PARENTCO AND THE COMPANY
SECTION 2.1 COVENANTS OF PARENTCO REGARDING EXCHANGEABLE SHARES.
So long as any Exchangeable Shares are outstanding, ParentCo (and
CallCo in the case of subclauses (e) and (f)) will:
(a) not declare or pay any dividend on ParentCo Common Stock
unless (A) the Company will have sufficient assets, funds and
other property available to enable the due declaration and the
due and punctual payment in accordance with applicable law of
a dividend in an equivalent amount on the Exchangeable Shares
in accordance with the
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Exchangeable Share Provisions and (B) Subsection 2.1(b) shall
be complied with in connection with such dividend;
(b) cause the Company to declare simultaneously with the
declaration of any dividend on ParentCo Common Stock a
dividend in an equivalent amount to such dividend on the
Exchangeable Shares and, when such dividend is paid on
ParentCo Common Stock, cause the Company to pay simultaneously
therewith a dividend in an equivalent amount on the
Exchangeable Shares, in each case in accordance with the
Exchangeable Share Provisions;
(c) advise the Company sufficiently in advance of the declaration
by ParentCo of any dividend on ParentCo Common Stock and take
all such other actions as are necessary, in co-operation with
the Company, to ensure that the respective declaration date,
record date and payment date for a dividend on the
Exchangeable Shares shall be the same as the record date,
declaration date and payment date for the corresponding
dividend on ParentCo Common Stock;
(d) ensure that the record date for any dividend declared on
ParentCo Common Stock is not less than 10 Business Days after
the declaration for such dividend;
(e) provide or cause to be provided to the Company such assets,
funds and other property as may be necessary in order that the
Company will have sufficient assets, funds, and other property
available to enable (i) the due declaration and the due and
punctual payment, in accordance with applicable law, of all
dividends on the Exchangeable Shares and (ii) the due
performance by the Company of its obligations under this
Agreement and the Company's Articles;
(f) to take all such actions and do all such things as are
necessary or desirable, to enable and permit the Company, or
CallCo if it exercised its Liquidation Call Right, in
accordance with applicable law, to pay and otherwise perform
its obligations with respect to the satisfaction of the
Exchangeable Share Consideration representing the Liquidation
Amount in respect of each issued and outstanding Exchangeable
Share upon the liquidation, dissolution or winding-up of the
Company or any other distribution of the assets of the Company
for the purpose of winding up its affairs, including without
limitation all such actions and all such things as are
necessary or desirable, to enable and permit the Company, or
CallCo, as the case may be, to cause to be delivered ParentCo
Common Stock to the holders of Exchangeable Shares in
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accordance with the provisions of Article 5 of the
Exchangeable Share Provisions or Article 3 herein, as the case
may be;
(g) take all such actions and do all such things as are necessary
or desirable, to enable and permit the Company or CallCo if it
exercises, the Retraction Call Right or the Redemption Call
Right, in accordance with applicable law, to pay and otherwise
perform its obligations with respect to the satisfaction of
the Exchangeable Share Consideration representing the
Retraction Price and the Redemption Price, including without
limitation all such actions and all such things as are
necessary or desirable, to enable and permit the Company or
CallCo to cause to be delivered ParentCo Common Stock to the
holders of Exchangeable Shares, upon the retraction or
redemption of the Exchangeable Shares in accordance with the
provisions of Article 6 or Article 7 of the Exchangeable Share
Provisions, as the case may be;
(h) take all actions and do all such things as are necessary or
desirable to perform the obligations of Parentco or Callco
with respect to the exercise of the Insolvency Exchange Right
or Redemption Call Right, as the case may be, including the
delivery of Parentco Common Stock to the Holders of the
Exchangeable Shares in accordance with the Exchange Share
Provisions;
(i) not to exercise its vote as a shareholder to initiate the
voluntary liquidation, dissolution or winding-up of the
Company nor take any action or omit to take any action that
will result in the liquidation, dissolution or winding-up of
the Company; and
(j) be the authorized representative of the Company for purposes
of making elections for U.S. federal tax purposes and will
otherwise represent the Company in front of the Internal
Revenue Service.
SECTION 2.2 RESERVATION FOR ISSUANCE OF PARENTCO COMMON STOCK.
ParentCo hereby represents, warrants and covenants that it has reserved
for issuance and will at all times keep available, free from pre-emptive and
other rights, out of its authorized and unissued capital shares such number of
ParentCo Common Stock (or other shares or securities into which ParentCo Common
Stock may be reclassified or changed as contemplated by Section 2.6 hereof) (a)
as is equal to the sum of (i) the number of Exchangeable Shares issued and
outstanding from time to time and (ii) the number of Exchangeable Shares
issuable upon the exercise of all rights to acquire Exchangeable Shares
outstanding from time to time and (b) as are now and may hereafter be required
to enable and permit the Company to meet its obligations hereunder, under the
Exchange Trust Agreement, under the Exchangeable Share Provisions and under any
other commitment with respect to
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which ParentCo may now or hereafter be required to issue ParentCo Common Stock.
SECTION 2.3 SEGREGATION OF FUNDS.
Upon Parentco providing or causing to be provided to the Company any
funds, assets or other property in accordance with Section 2.1, the Company
shall deposit such funds in a separate account and segregate such assets and
other property, in each case for the benefit of Holders from time to time of the
Exchangeable Shares, and will use such funds, assets and other property
exclusively for the payment of dividends and the payment or other satisfaction
of the Liquidation Amount and the Retraction Price.
SECTION 2.4 NOTIFICATION OF CERTAIN EVENTS.
In order to assist ParentCo and CallCo to comply with their obligations
hereunder, the Company will give ParentCo and CallCo notice of each of the
following events at the time set forth below:
(a) Subject to the Exchangeable Share Provisions, in the event of
any determination by the Board of Directors of the Company in
accordance with the constating documents of the Company to
institute voluntary liquidation, dissolution or winding-up
proceedings with respect to the Company or to effect any other
distribution of the assets of the Company among its
shareholders for the purpose of winding-up its affairs, at
least 60 days prior to the proposed effective date of such
liquidation, dissolution, winding-up or other distribution;
(b) Immediately, upon the earlier of (i) receipt by the Company of
notice of, and (ii) the Company otherwise becoming aware of,
any threatened or instituted claim, suit, petition or other
proceedings with respect to the involuntary liquidation,
dissolution or winding-up of the Company or to effect any
other distribution of the assets of the Company among its
shareholders for the purpose of winding-up its affairs;
(c) Promptly, upon receipt by the Company of a Retraction Request
or notice of an exercise of an Exchange Right (as defined in
the Exchangeable Share Provisions);
(d) At least 60 days prior to any accelerated Automatic Redemption
Date determined by the Board of Directors of the Company in
accordance with the Exchangeable Share Provisions; and
(e) As soon as practicable upon the issuance by the Company of any
Exchangeable Shares or rights to acquire Exchangeable Shares.
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SECTION 2.5 DELIVERY OF PARENTCO COMMON STOCK.
In furtherance of its obligations hereunder, upon notice of any event
which requires the Company, Parentco or Callco to cause to be delivered ParentCo
Common Stock to any holder of Exchangeable Shares, CallCo shall forthwith
deliver the requisite ParentCo Common Stock to the former holder of the
surrendered Exchangeable Shares, as the Holder shall direct. All such ParentCo
Common Stock shall be duly issued as fully paid and non-assessable and shall be
free and clear of any lien, claim, encumbrance, security interest or adverse
claim or interest created by ParentCo, CallCo or the Company. In consideration
of the delivery of each such ParentCo Common Stock by CallCo, the Exchangeable
Shares held by CallCo shall automatically convert into such number of Common
Shares of the Company as is equal to the fair value of such ParentCo Common
Stock delivered.
SECTION 2.6 QUALIFICATION OF PARENTCO COMMON STOCK.
ParentCo covenants that if any ParentCo Common Stock to be issued and
delivered hereunder (including, for greater certainty, pursuant to the
Exchangeable Share Provisions, or pursuant to the Insolvency Exchange Right or
the Automatic Exchange Rights (both as defined in the Exchange Trust Agreement)
require registration or qualification with or approval of or the filing of any
document including any prospectus or similar document, the taking of any
proceeding with or the obtaining of any order, ruling or consent from any
governmental or regulatory authority under any Canadian or United States
federal, provincial or state law or regulation or pursuant to the rules and
regulations of any regulatory authority, or the fulfilment of any other legal
requirement (collectively, the "APPLICABLE LAWS") before such shares may be
issued and delivered by ParentCo to the initial holder thereof (other than the
Company), ParentCo will, in good faith, expeditiously take all such actions and
do all such things as are necessary to cause such ParentCo Common Stock to be
and remain duly registered, qualified or approved to the extent expressly
provided in the Purchase Agreement or Registration Rights Agreement. ParentCo
represents and warrants that it has, in good faith, taken all actions and done
all things as are necessary under Applicable Laws as they exist on the date
hereof to cause the ParentCo Common Stock to be issued and delivered hereunder
(including, for greater certainty, pursuant to the Exchangeable Share Provisions
or pursuant to the Insolvency Exchange Right and the Automatic Exchange Rights).
ParentCo will, in good faith, expeditiously take all such actions and do all
such things as are necessary to cause all ParentCo Common Stock to be delivered
hereunder (including, for greater certainty, pursuant to Exchangeable Share
Provisions or pursuant to the Insolvency Exchange Right or the Automatic
Exchange Rights) to be listed, quoted or posted for trading on all stock
exchanges and quotation systems on which such shares are listed, quoted or
posted for trading at such time.
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SECTION 2.7 EQUIVALENCE.
ParentCo hereby covenants and agrees to cause the Company to effect the
necessary amendments to the constating documents of the Company to ensure that
the Exchangeable Shares are adjusted to fully reflect the effect of any split,
reverse split, dividend (including any dividend of securities convertible into
ParentCo Common Stock), reorganization, recapitalization or other like change
with respect to ParentCo Common Stock occurring after the date hereof.
SECTION 2.8 TENDER OFFERS, ETC.
In the event that a tender offer, share exchange offer, issuer bid,
take-over bid or similar transaction with respect to ParentCo Common Stock (an
"OFFER") is proposed by ParentCo or is proposed to ParentCo or its shareholders
and is recommended by the board of directors of ParentCo, or is otherwise
effected or to be effected with the consent or approval of the board of
directors of ParentCo, ParentCo shall, in good faith, take all such actions and
do all such things as are necessary or desirable to enable and permit holders of
Exchangeable Shares to participate in such Offer to the same extent and on an
economically equivalent basis as the holders of ParentCo Common Stock, without
discrimination, including, without limiting the generality of the foregoing,
ParentCo will use its good faith reasonable best efforts expeditiously to (and
shall, in the case of a transaction proposed by ParentCo or where ParentCo is a
participant in the negotiation thereof) ensure that Holders of the Exchangeable
Shares may participate in all such Offers without being required to exchange the
Exchangeable Shares for Parentco Common Stock (or, if so required, to ensure
that any such exchange shall be effective only upon, and shall be conditional
upon, the closing of the Offer and only to the extent necessary to tender of
deposit to the Offer).
SECTION 2.9 DUE PERFORMANCE.
On and after the Effective Date, ParentCo and CallCo shall duly and
timely perform all of its obligations under the Exchangeable Share Provisions.
ARTICLE 3
CERTAIN RIGHTS OF CALLCO TO ACQUIRE EXCHANGEABLE SHARES
SECTION 3.1 CALLCO LIQUIDATION CALL RIGHT.
(1) CallCo shall have the overriding right (the "LIQUIDATION CALL RIGHT"),
in the event of and notwithstanding liquidation, dissolution or
winding-up of the Company as referred to in Article 5 of the
Exchangeable Share Provisions, to purchase from all but not less than
all, of the Holders on the Liquidation Date (other than ParentCo or any
Affiliate or Subsidiary thereof) all but not less than all of the
Exchangeable Shares held by each such Holder by Callco delivering or
causing to deliver to each holder the Exchangeable Share Price
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applicable on the last Business Day prior to the Liquidation Date (the
"LIQUIDATION CALL PURCHASE PRICE"), which as provided in this Section
3.1, shall be fully paid and satisfied by the delivery by or on behalf
of CallCo of the Exchangeable Share Consideration representing the
Liquidation Call Purchase Price. In the event of the exercise of the
Liquidation Call Right by ParentCo, each Holder shall be obligated to
sell all of the Exchangeable Shares held by the Holder to CallCo on the
Liquidation Date on delivery by CallCo to the Holder of the
Exchangeable Share Consideration representing the Liquidation Call
Purchase Price for each such share. In connection with payment of the
Exchangeable Share Consideration representing the total Liquidation
Call Purchase Price, CallCo shall be entitled to withhold, sell or
dispose of that number of ParentCo Common Stock otherwise be
deliverable as Exchangeable Share Consideration to the particular
Holder in order to satisfy any statutory withholding tax obligation.
(2) To exercise the Liquidation Call Right, CallCo must notify the Company
and the Trustee on behalf of the holders of Exchangeable Shares in
writing of its intention to exercise such right at least 30 days before
the Liquidation Date in the case of a voluntary liquidation,
dissolution or winding-up of the Company and at least five Business
Days before the Liquidation Date in the case of an involuntary
liquidation, dissolution or winding-up of the Company. The Company will
notify in writing the Trustee on behalf of the holders of Exchangeable
Shares as to whether or not CallCo has exercised the Liquidation Call
Right forthwith after the expiry of the date by which the same may be
exercised by CallCo. If CallCo exercises the Liquidation Call Right, on
the Liquidation Date, CallCo will purchase and the holders will sell
all of the Exchangeable Shares then outstanding for the Exchangeable
Share Consideration representing the total Liquidation Call Purchase
Price.
(3) On and after the Liquidation Date the right of each holder of
Exchangeable Shares will be limited to receiving such holder's
proportionate share of the Exchangeable Share Consideration
representing the total Liquidation Call Purchase Price payable by
CallCo without interest upon presentation and surrender by the holder
of certificates representing the Exchangeable Shares held by such
holder and the holder shall on and after the Liquidation Date be
considered and deemed for all purposes to be the holder of the ParentCo
Common Stock delivered to it. Upon surrender to the Company of a
certificate or certificates representing the Exchangeable Shares,
together with such other documents and instruments as may be required
to effect a transfer of Exchangeable Shares under the Act and the
constating documents of the Company and such additional documents and
instruments as the Company may reasonably require, the holder of such
surrendered certificate or certificates shall be entitled to receive in
exchange therefor, and ParentCo
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shall deliver to such holder, the Exchangeable Share Consideration to
which the holder is entitled. If CallCo does not exercise the
Liquidation Call Right in the manner described above, on the
Liquidation Date the holders of the Exchangeable Shares will be
entitled to receive in exchange therefor the Exchangeable Share
Consideration representing the Liquidation Amount otherwise payable by
the Company in connection with the liquidation, dissolution or
winding-up of the Company pursuant to Article 5 of the Exchangeable
Share Provisions.
SECTION 3.2 CALLCO REDEMPTION CALL RIGHT.
(1) CallCo shall have the overriding right (the "REDEMPTION CALL RIGHT"),
notwithstanding the proposed redemption of the Exchangeable Shares by
the Company pursuant to Article 7 of the Exchangeable Share Provisions,
to purchase from all, but not less than all, of the holders of
Exchangeable Shares on the Automatic Redemption Date (other than
ParentCo or any Affiliate Subsidiary thereof) all but not less than all
of the Exchangeable Shares held by each such holder on delivery by
CallCo to the holder of the Exchangeable Share Price applicable on the
last Business Day prior to the Automatic Redemption Date (the
"REDEMPTION CALL PURCHASE PRICE"), which as provided in this Section
3.2, shall be fully paid and satisfied by the delivery by or on behalf
of CallCo of the Exchangeable Share Consideration representing the
Redemption Call Purchase Price. In the event of the exercise of the
Redemption Call Right by CallCo, each holder shall be obligated to sell
all the Exchangeable Shares held by the holder to CallCo on the
Automatic Redemption Date on delivery by CallCo to the holder of the
Exchangeable Share Consideration representing the Redemption Call
Purchase Price for each such share. In connection with payment of the
Exchangeable Share Consideration representing the total Redemption Call
Purchase Price, CallCo shall be entitled to withhold, sell or dispose
of that number of the ParentCo Common Stock otherwise deliverable to
the particular holder of Exchangeable Shares in order to satisfy any
statutory withholding obligation.
(2) To exercise the Redemption Call Right, ParentCo must notify the Company
in writing of CallCo's intention to exercise such right at least 60
days before the Automatic Redemption Date. The Company will notify the
holders of the Exchangeable Shares in writing as to whether or not
Callco has exercised the Redemption Call Right forthwith after the date
by which the same may be exercised by CallCo. If CallCo exercises the
Redemption Call Right, on the Automatic Redemption Date, CallCo will
purchase and the holders will sell all of the Exchangeable Shares then
outstanding for the Exchangeable Share Consideration representing the
total Redemption Call Purchase Price.
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(3) On and after the Automatic Redemption Date the rights of each holder of
Exchangeable Shares will be limited to receiving such holder's
proportionate share of the Exchangeable Share Consideration
representing the total Redemption Call Purchase Price payable by CallCo
upon presentation and surrender by the holder of certificates
representing the Exchangeable Shares held by such holder and the holder
shall on and after the Automatic Redemption Date be considered and
deemed for all purposes to be the holder of such holder's proportionate
share of such Exchangeable Share Consideration and unless and until
such Exchangeable Share Consideration is so received the holders shall
continue to be treated as holders of the Exchangeable Shares for all
purposes. Upon surrender to the Company of a certificate or
certificates representing Exchangeable Shares, together with such other
documents and instruments as may be required to effect a transfer of
Exchangeable Shares under the Act and the constating documents of the
Company and such additional documents and instruments as the Company
may reasonably require, the holder of such surrendered certificate or
certificates shall be entitled to receive in exchange therefor, and the
Company shall deliver to such holder, the Exchangeable Share
Consideration to which the holder is entitled. If CallCo does not
exercise the Redemption Call Right in the manner described above, on
the Automatic Redemption Date the holders of the Exchangeable Shares
will be entitled to receive in exchange therefor the Exchangeable Share
Consideration representing the Redemption Price otherwise payable by
the Company in connection with the redemption of the Exchangeable
Shares pursuant to Article 7 of the Exchangeable Share Provisions.
SECTION 3.3 INSOLVENCY EXCHANGE RIGHT
Upon and subject to the terms and conditions contained in the
Exchangeable Share Provisions and the Exchange Trust Agreement:
(a) a Holder of Exchangeable Shares shall have the right (the
"INSOLVENCY EXCHANGE RIGHT") upon the occurrence and during
the continuance of an Insolvency Event (as such term is
defined in the Exchange Trust Agreement) to require ParentCo
to purchase all or any part of the Exchangeable Shares of the
Holder; and
(b) upon the exercise by the Holder of the Insolvency Exchange
Right, the Holder shall be required to sell to ParentCo, and
ParentCo shall be required to purchase from the Holder, that
number of Exchangeable Shares in respect of which the
Insolvency Exchange Right is exercised, in consideration of
the payment by ParentCo of the Exchangeable Share Price
applicable thereto which should be fully paid and satisfied by
the delivery by or on behalf of ParentCo of the Exchangeable
Share
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Consideration representing the total applicable Exchangeable
Share Price. In connection with the payment of the
Exchangeable Share Consideration representing the total
applicable Exchangeable Share Price, ParentCo shall be
entitled to withhold, sell or dispose of that number of
ParentCo Common Stock which would otherwise be deliverable as
Exchangeable Share Consideration to the particular Holder
required in order to fund any statutory withholding tax
obligation.
ARTICLE 4
PARENTCO SUCCESSORS
SECTION 4.1 CERTAIN REQUIREMENTS IN RESPECT OF COMBINATION, ETC.
(1) ParentCo shall not enter into any transaction (whether by way of
reconstruction, reorganization, consolidation, merger, or otherwise),
unless:
(a) such other Person or continuing company (the "PARENTCO
SUCCESSOR"), by operation of law, becomes, without more, bound
by the terms and provisions of this Agreement or, if not so
bound, executes, prior to or contemporaneously with the
consummation of such transaction an agreement supplemental
hereto and such other instruments (if any) as are necessary or
advisable to evidence the assumption by the ParentCo Successor
of liability for all moneys payable and property deliverable
hereunder, the covenant of such ParentCo Successor to pay and
deliver or cause to be delivered the same and its agreement to
observe and perform all the covenants and obligations of
ParentCo under this Agreement; and
b) such transaction shall be upon such terms to the satisfaction
of the Trustee and in the opinion of legal counsel to the
Trustee, acting reasonably, which substantially preserve and
do not impair in any material respect any of the rights,
duties, powers and authorities of the Trustee or of the
Holders hereunder.
SECTION 4.2 VESTING OF POWERS IN SUCCESSOR.
In the event that Section 4.1 hereof applies, the ParentCo Successor,
CallCo, the Holders and the Company shall execute and deliver the supplemental
agreement provided for in Section 4.4 hereof, and thereupon the ParentCo
Successor shall possess and from time to time may exercise each and every right
and power of ParentCo under this Agreement in the name of ParentCo or otherwise
and any act or proceeding by any provision of this Agreement required to be done
or performed by the board of directors of ParentCo or any officers of ParentCo
may be done and
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performed with like force and effect by the directors or officers of such
ParentCo Successor.
SECTION 4.3 WHOLLY-OWNED SUBSIDIARIES
Nothing herein shall be construed as preventing the amalgamation or
merger of any wholly-owned subsidiary of ParentCo with or into the ParentCo or
the winding-up, liquidation or dissolution of any wholly-owned subsidiary of
ParentCo provided that all of the assets of such subsidiary are transferred to
ParentCo or another wholly-owned subsidiary of ParentCo and any such
transactions are expressly permitted by this Article 4.
SECTION 4.4 EXECUTION OF SUPPLEMENTAL AGREEMENTS.
From time to time the Company (when authorized by a resolution of its
Board of Directors), ParentCo (when authorized by a resolution of its board of
directors), CallCo (when authorized by a resolution of its board of directors)
and the Holders may, subject to the provisions of these presents, and they
shall, when so directed by these presents, execute and deliver by their proper
officers, agreements or other instruments supplemental hereto, which thereafter
shall form part hereof, to evidence the succession of any ParentCo Successors to
ParentCo and the covenants of and obligations assumed by each such ParentCo
Successor in accordance with the provisions of this Article 4.
ARTICLE 5
GENERAL
SECTION 5.1 TERM.
This Agreement shall come into force and be effective as of the date
hereof and shall terminate and be of no further force and effect at such time as
no Exchangeable Shares (or securities or rights convertible into or exchangeable
for or carrying rights to acquire Exchangeable Shares) are held by any party
other than ParentCo and any of its Subsidiaries or Affiliates.
SECTION 5.2 CHANGES IN CAPITAL OF PARENTCO AND THE COMPANY.
Notwithstanding the provisions of Section 4.7 hereof, at all times
after the occurrence of any event in which or as a result of which either
ParentCo Common Stock or the Exchangeable Shares or both are in any way changed,
this Agreement shall forthwith be amended and modified as necessary in order
that it shall apply with full force and effect, mutatis mutandis, to all new
securities into which ParentCo Common Stock or the Exchangeable Shares or both
are so changed, and the parties hereto shall execute and deliver an agreement in
writing giving effect to and evidencing such necessary amendments and
modifications.
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SECTION 5.3 ENCUMBRANCES, LIENS.
Parentco hereby represents, warrants and covenants that all Parentco
Common Stock issued pursuant to the exercise by a Holder of such Holder's
Exchange Right, the Automatic Exchange or the exercise by Parentco of the
Liquidation Call Right or the Retraction Call Right or otherwise under this
Agreement (each, a "SHARE EXCHANGE") shall be duly issued, fully paid and
non-assessable.
SECTION 5.4 SEVERABILITY.
If any provision of this Agreement is held to be invalid, illegal or
unenforceable, the validity, legality or enforceability of the remainder of this
Agreement shall not in any way be affected or impaired thereby and this
Agreement shall be carried out as nearly as possible in accordance with its
original terms and conditions.
SECTION 5.5 AMENDMENTS, MODIFICATIONS, ETC.
This Agreement may not be amended or modified except by an agreement in
writing executed by the Company, CallCo and ParentCo and the Holders in
accordance with Section 9.2 of the Exchangeable Share Provisions.
SECTION 5.6 MINISTERIAL AMENDMENTS.
Notwithstanding the provisions of Section 5.7 hereof, the Company and
ParentCo may by written notice to the holders of Exchangeable Shares, at any
time and from time to time, without the approval of the holders of the
Exchangeable Shares, amend or modify this Agreement for the purposes of:
(a) Adding to the covenants of either or both such parties for the
protection of the holders of the Exchangeable Shares;
(b) Making such amendments or modifications not inconsistent with
this Agreement as may be necessary or desirable with respect
to matters or questions which, in the opinion of the board of
directors of each of the Company CallCo and ParentCo, on the
advice of counsel, it may be expedient to make, provided that
such amendments or modifications will not be prejudicial or
adverse to the interests of the holders of the Exchangeable
Shares; or
(c) Making such changes or corrections which, on the advice of
counsel to the Company CallCo and ParentCo, are required for
the purpose of curing or correcting any ambiguity or defect or
inconsistent provision or clerical omission or mistake or
manifest error; provided that the changes or corrections will
not be prejudicial or adverse to the interests of the holders
of the Exchangeable Shares.
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SECTION 5.7 MEETING TO CONSIDER AMENDMENTS.
The Company, at the request of CallCo or ParentCo, shall call a meeting
or meetings of the holders of the Exchangeable Shares for the purpose of
considering any proposed amendment or modification requiring approval of such
shareholders. Any such meeting or meetings shall be called and held in
accordance with the constating documents of the Company, the Exchangeable Share
Provisions and all applicable laws.
SECTION 5.8 AMENDMENTS ONLY IN WRITING.
No amendment to or modification or waiver of any of the provisions of
this Agreement otherwise permitted hereunder shall be effective unless made in
writing and signed by all of the parties hereto.
SECTION 5.9 ENUREMENT.
This Agreement shall be binding upon and enure to the benefit of the
parties hereto and the holders, from time to time, of Exchangeable Shares and
each of their respective heirs, administrators, executors, successors and
assigns.
SECTION 5.10 WAIVER.
Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver hereof.
SECTION 5.11 NOTICES TO PARTIES.
(1) All notices and other communications between the parties shall be in
writing and shall be deemed to have been given if delivered personally
or by confirmed facsimile to the parties at the following addresses (or
at such other address for either such party as shall be specified in
like notice):
TO PARENTCO OR CALLCO: ▇▇▇▇▇▇ Technologies, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
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With a copy to: ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
1600 Atlanta Financial Center
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
TO THE COMPANY: ▇▇▇▇▇▇ Canada Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
With a copy to: ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
1600 Atlanta Financial Center
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With an additional copy to: Stikeman, ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
TO THE HOLDERS: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇-▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
With a copy to: Blake, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
Commerce Court West
PO Box 25, Stn. Commerce Court
Toronto, Ontario M5L 1A9
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(2) Any notice or other communication given personally shall be deemed to
have been given and received upon delivery thereof and if given by
facsimile shall
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be deemed to have been given and received on the date of confirmed
receipt thereof, unless such day is not a Business Day, in which case
it shall be deemed to have been given and received upon the immediately
following Business Day.
SECTION 5.12 COUNTERPARTS.
This Agreement may be executed in counterparts, each of which shall be
deemed an original, and all of which taken together shall constitute one and the
same instrument. This Agreement may be executed and delivered by facsimile with
the originals to be delivered in due course.
SECTION 5.13 JURISDICTION.
This Agreement shall be construed and enforced in accordance with the
laws of the Province of Ontario and the laws of Canada applicable therein.
SECTION 5.14 ATTORNMENT.
ParentCo, Callco and the Company agree that any action or proceeding
arising out of or relating to this agreement may be instituted in the courts of
Ontario, waives any objection which it may have now or hereafter to the venue of
any such action or proceeding, irrevocably submits to the jurisdiction of such
courts in any such action or proceeding, agrees to be bound by any judgment of
such courts and not to seek, and hereby waives, any review of the merits of any
such judgment by the courts of any other jurisdiction and hereby appoints
Stikeman, ▇▇▇▇▇▇▇ in the Province of Ontario as CallCo's, the Company's and
ParentCo's attorney for service of process.
SECTION 5.15 PARENTCO NOT TO VOTE EXCHANGEABLE SHARES.
Parentco covenants and agrees that it will appoint and cause to be
appointed proxyholders with respect to all Exchangeable Shares held by Parentco
and its Subsidiaries (as such term is defined in the Purchase Agreement) for the
sole purpose of attending each meeting of holders of exchangeable shares in
order to be counted as part of the quorum for each such meeting. Parentco
further covenants and agrees that it will not, and will cause its Subsidiaries
not to, exercise any voting rights which may be exercisable by holders of
exchangeable shares from time to time pursuant to the Company's Articles or
pursuant to the provisions of the Companies Act (Nova Scotia) (or any successor
other corporate statute by which the Company may in the future be governed) with
respect to any Exchangeable Shares held by it or by its Subsidiaries in respect
of any matter considered at any meeting of holders of exchangeable shares.
SECTION 5.16 OWNERSHIP OF OUTSTANDING SHARES.
Without the prior approval of the holders of Exchangeable Shares given
in accordance with the meeting and voting procedures set forth in the Articles,
in
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respect of which approval the provisions of section 1.5 of this Agreement shall
be applicable, Parentco covenants and agrees that Parentco or a Parentco
Successor will be and remain the direct or indirect beneficial owner of all of
the issued and outstanding shares in the capital of the Company and all
outstanding securities of the Company carrying or otherwise entitled to voting
rights in any circumstances, in each case other than the Exchangeable Shares.
SECTION 5.17 OBLIGATIONS OF HOLDERS SEVERAL.
The obligations of the Holders under this Agreement are several and not
joint and several.
SECTION 5.18 GUARANTY /ASSIGNMENT.
ParentCo hereby unconditionally and irrevocably guarantees the prompt
and full performance by CallCo of, and shall cause CallCo to comply with its
obligations hereunder. The right to exercise any particular Redemption Call
Right and, Retraction Call Right and/or Liquidation Call Right at any time may
be assigned or transferred, in whole or in part, to any affiliate of CallCo or
ParentCo provided, however, that notwithstanding such assignment or transfer in
the event that such assignee or transferee fails to satisfy such obligation,
ParentCo or CallCo hereby absolutely and irrevocably agrees to guarantee such
obligation and ParentCo hereby waives any defences to the strict enforcement
thereof. Parentco may not assign its rights and obligations under this
Agreement.
IN WITNESS WHEREOF the parties have executed this Support Agreement.
▇▇▇▇▇▇ TECHNOLOGIES, INC.
By:
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Authorized Signing Officer
▇▇▇▇▇▇ CANADA CORPORATION
By:
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Authorized Signing Officer
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▇▇▇▇▇▇ CALLCO CORPORATION
By:
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Authorized Signing Officer
THE UNDERSIGNED HOLDERS OF EXCHANGEABLE SHARES HEREBY ACKNOWLEDGE AND ACCEPT THE
RIGHTS OF CALLCO AND PARENTCO AS SET FORTH IN ARTICLE 3 HEREOF.
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NAHLA RASHAD
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1303949 ONTARIO INC.
By:
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Name:
Title:
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SIGNATURES CONTINUED
THE VENGROWTH INVESTMENT
FUND INC.
By:
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Name:
Title:
