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Exhibit 99.2.J(ii)
COLLATERAL AGENCY AGREEMENT
THIS COLLATERAL AGENCY AGREEMENT, dated as of this ____ day of November,
1997, among ___________ (the "Pledgor"), a corporation organized under the law
of the Province of Ontario; DECS Trust II (such trust and the trustees thereof
acting in their capacity as such being referred to herein as the "Trust" and
the "Trustees," respectively), a statutory business trust organized under the
Business Trust Act of the State of Delaware pursuant to a Declaration of Trust
dated as of September 4, 1997 (as it may be amended and restated from time to
time, the "Trust Agreement"); The Bank of New York, a New York banking
corporation, as collateral agent (the "Collateral Agent") for the Trust under
the Collateral Agreement (the "Collateral Agreement"), dated as of November
___, 1997, among the Pledgor, the Collateral Agent and the Trust; Royal Group
Technologies Limited, a company amalgamated under the laws of Canada (the
"Company"); and CIBC Mellon Trust Company, a trust company incorporated under
the laws of Canada, as sub-collateral agent (the "Sub-Collateral Agent"), as
stock trustee (the "Stock Trustee") under the Stock Control Agreement referred
to below and as transfer agent (the "Transfer Agent") of the Company's
Subordinate Voting Shares (as defined below).
WITNESSETH:
WHEREAS, the Trust is a non-diversified, closed-end management investment
company, as defined in the Investment Company Act of 1940, formed to purchase
and hold certain U.S. treasury securities, to enter into and hold forward
purchase contracts with one or more existing shareholders of Royal Group
Technologies Limited (the "Company"), including a forward purchase contract
(the "Contract") to which the Pledgor is a party, to hold security for the
performance of such shareholders of their obligations under the forward
purchase contracts pursuant to related collateral agreements, including the
collateral agreement (the "Collateral Agreement") to which the Pledgor is a
party, and to issue DECS in accordance with the terms and conditions of the
Trust Agreement;
WHEREAS, the Pledgor may pledge as security under its Contract and
Collateral Agreement either subordinate voting shares ("Subordinate Voting
Shares") or multiple voting shares ("Multiple Voting Shares" and, together with
Subordinate Voting Shares, "Voting Shares") of the Company;
WHEREAS, the Pledgor, CIBC Mellon Trust Company, as Stock Trustee and as
Transfer Agent, the Company and other holders from time to time of Multiple
Voting Shares have entered into a Stock Control Agreement (the "Stock Control
Agreement"), dated as of November 30, 1994, governing the holding and transfer
of Multiple Voting Shares;
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WHEREAS, in order to comply with the terms of the Stock Control Agreement, the
Pledgor, the Trust, the Company and the Collateral Agent desire to engage the
services of the Sub-Collateral Agent to perform certain duties with respect to
the Multiple Voting Shares; and
WHEREAS, the Sub-Collateral Agent is qualified and willing to assume such
duties on the terms and conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto agree as follows:
1. Appointment of Sub-Collateral Agent; Transfer of Multiple Voting Shares.
The Collateral Agent hereby constitutes and appoints the Sub-Collateral Agent,
and the Sub-Collateral Agent accepts such appointment, as agent of the Trust
and the Collateral Agent and as custodian of all Multiple Voting Shares pledged
by the Pledgor as collateral under the Collateral Agreement to secure its
obligations under the Contract. The Stock Trustee hereby deposits such
Multiple Voting Shares (the particulars of such Multiple Voting Shares being
set forth in Schedule A hereto) with the Sub-Collateral Agent, and the
Sub-Collateral Agent hereby accepts such Multiple Voting Shares into its
custody, and the Stock Trustee shall deliver to the Sub-Collateral Agent all
additional Multiple Voting Shares pledged as collateral under the Collateral
Agreement that are received by the Stock Trustee at any time during the period
of this Agreement, subject to the following terms and conditions. The
Sub-Collateral Agent hereby agrees that it shall hold the certificates
representing the Multiple Voting Shares in a segregated custody account,
separate and distinct from all other accounts, in accordance with Section 17(f)
of, and in such manner as shall constitute the segregation and holding in trust
within the meaning of, the U.S. Investment Company Act of 1940, as amended (the
"Investment Company Act"), and the rules and regulations thereunder. All
certificates representing the Multiple Voting Shares held by the Sub-Collateral
Agent shall be held in Canada. The Sub-Collateral Agent shall be under no duty
or obligation to inspect, review or examine any of the certificates
representing the Multiple Voting Shares to determine that they are genuine,
enforceable, or appropriate for the represented purpose or that they are other
than what they purport to be on their face.
2. Multiple Voting Share Disposition. The Sub-Collateral Agent shall have
no power or authority to assign, hypothecate, pledge or otherwise dispose of
the Multiple Voting Shares, except pursuant to and in accordance with paragraph
3 below and then only for the account of the Collateral Agent. The Multiple
Voting Shares shall be subject to no lien or charge of any kind in favor of the
Sub-Collateral Agent for itself or for any other Person claiming through the
Sub-Collateral Agent. The Sub-Collateral Agent shall permit actual examination
of the certificates representing the Multiple Voting Shares by the Trust's
independent public accountants at the end of each annual and semi-annual fiscal
period of the Trust and at least one other time during the fiscal year of the
Trust chosen by such independent public accountants and shall permit the
inspection of the certificates representing the Multiple Voting Shares by the
Commission through its employees or agents during the normal business hours of
the Sub-Collateral Agent upon reasonable written request.
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3. Authorized Actions. The Sub-Collateral Agent shall take no actions
with respect to the Multiple Voting Shares except as follows:
(a) Upon receipt of written directions from the Pledgor and the
Collateral Agent, the Sub-Collateral Agent shall transfer and deliver to
the Stock Trustee any Multiple Voting Shares that have been released from
their pledge as collateral under the Collateral Agreement and that have
not been converted and are not required at such time to be converted into
Subordinate Voting Shares, whether pursuant to clause (b) of this
paragraph 3 or otherwise; and
(b) Upon receipt of written directions from the Collateral Agent
upon the occurrence of (i) the termination of the Trust, (ii) the
Exchange Date, as defined in the Contract, or (iii) any other event
requiring the delivery under the Contract and the Collateral Agreement of
Subordinate Voting Shares in fulfillment of the obligation of the Pledgor
under the Contract, the Sub-Collateral Agent together with the Stock
Trustee shall effect the conversion of the Multiple Voting Shares held by
the Sub-Collateral Agent into Subordinate Voting Shares, registered as
directed in writing by the Collateral Agent, and the Sub-Collateral Agent
shall deliver such Subordinate Voting Shares to the Collateral Agent in
accordance with an irrevocable direction from the Company to issue
Subordinate Voting Shares addressed to the Stock Trustee as Transfer
Agent, such direction being attached hereto as Schedule B. The
Sub-Collateral Agent shall have no obligation or right to question the
validity of any such written directions received from the Collateral
Agent. Any written directions provided by the Collateral Agent pursuant
to this clause (b) of this paragraph 3 shall be irrevocable.
4. Sub-Collateral Agent's Actions Taken In Good Faith. In connection with
the performance of its duties under this Agreement, the Sub-Collateral Agent
(a) shall have no duties or obligations other than those specifically set forth
herein or as may subsequently be agreed in writing by the parties hereto, (b)
shall have no liability or responsibility arising under any other agreement,
including any agreement referred to in this Agreement to which the
Sub-Collateral Agent is not a party and (c) shall be under no liability to the
Pledgor or the Collateral Agent for any action taken in good faith in reliance
on any paper, order, certification, list, demand, request, consent, affidavit,
notice, opinion, direction, endorsement, assignment, resolution, draft or other
document, prima facie properly executed, or for the disposition of the Multiple
Voting Shares pursuant to the Collateral Agreement or in respect of any action
taken or suffered under the Collateral Agreement in good faith, in accordance
with an opinion of counsel or at the direction of the Pledgor or the Collateral
Agent pursuant hereto; provided that this provision shall not protect the
Sub-Collateral Agent against any liability to which it would otherwise be
subject by reason of willful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties hereunder. Notwithstanding any other provision of this
Agreement, the Sub-Collateral Agent shall under no circumstances be liable for
any punitive, exemplary, indirect or consequential damages.
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5. Collateral Agreement Validity. The Sub-Collateral Agent shall not be
responsible for the validity or sufficiency of the Collateral Agreement or the
due execution thereof, or for the form, character, genuineness, sufficiency,
value or validity of any of the Multiple Voting Shares, and the Sub-Collateral
Agent shall in no event assume or incur any liability, duty or obligation to
any holder of the DECS issued by the Trust or to the Trustees, other than as
expressly provided herein. The Sub-Collateral Agent shall not be responsible
for or in respect of the validity of any signature by or on behalf of the
Pledgor, the Collateral Agent, the Company or the Trustees.
6. Sub-Collateral Agent Resignation, Succession. (a) The Sub-Collateral
Agent may resign by executing an instrument in writing resigning as
Sub-Collateral Agent and delivering the same to the Pledgor, the Collateral
Agent and the Trustees, not less than 60 days before the date specified in such
instrument when, subject to clause (b) of this paragraph 6, such resignation is
to take effect. Upon receiving such notice of resignation, the Pledgor, the
Collateral Agent and the Trustees shall use their reasonable efforts promptly
to appoint a successor Sub-Collateral Agent in the manner and meeting the
qualifications provided in the Collateral Agreement and the Stock Control
Agreement, by written instrument or instruments delivered to the resigning
Sub-Collateral Agent and the successor Sub-Collateral Agent.
(b) In case no successor Sub-Collateral Agent shall have been appointed
within 30 days after notice of resignation has been received by the Pledgor,
the Collateral Agent and the Trustees, the resigning Sub-Collateral Agent may
forthwith apply to a court of competent jurisdiction at the Pledgor's cost and
expense for the appointment of a successor Sub-Collateral Agent. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribed,
appoint a successor Sub-Collateral Agent.
7. Sub-Collateral Agent Removal. In case at any time the Sub-Collateral
Agent shall not meet the requirements set forth in the Collateral Agreement and
the Stock Control Agreement or shall become incapable of acting or if a court
having jurisdiction shall enter a decree or order for relief in respect of the
Sub-Collateral Agent in an involuntary case, or the Sub-Collateral Agent shall
commence a voluntary case, under any applicable bankruptcy, insolvency, or
other similar law now or hereafter in effect, or any receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) for the
Sub-Collateral Agent or for any substantial part of its property shall be
appointed, or the Sub-Collateral Agent shall make any general assignment for
the benefit of creditors, or shall generally fail to pay its debts as they
become due, either the Trust or the Collateral Agent may remove the
Sub-Collateral Agent immediately and appoint a successor Sub-Collateral Agent.
8. Transfers to Successor Sub-Collateral Agent. Upon the request of any
successor Sub-Collateral Agent and upon compliance with the requirements of the
Stock Control Agreement, the Sub-Collateral Agent hereunder shall, upon payment
of all amounts due it, execute and deliver an instrument acknowledged by it
transferring to such successor Sub-Collateral Agent all the rights and powers
of the retiring Sub-Collateral Agent; and the retiring
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Sub-Collateral Agent shall transfer and deliver to the successor Sub-Collateral
Agent the Multiple Voting Shares at the time held by it hereunder, if any,
together with all necessary instruments of transfer and assignment or other
documents property executed necessary to effect such transfer and such of the
records or copies thereof maintained by the retiring Sub-Collateral Agent in
the administration hereof as may be requested by the successor Sub-Collateral
Agent, and shall thereupon be discharged from all duties and responsibilities
hereunder. Any resignation or removal of the Sub-Collateral Agent shall become
effective upon such acceptance of appointment by the successor Sub-Collateral
Agent. The indemnification of the resigning Sub-Collateral Agent provided for
hereunder shall survive any resignation, discharge or removal of the
Sub-Collateral Agent hereunder.
9. Sub-Collateral Agent Merger, Consolidation. Any corporation into which
the Sub-Collateral Agent may be merged, converted or amalgamated or with which
it may be consolidated or combined pursuant to a plan of arrangement, or any
corporation resulting from any merger, conversion, amalgamation, consolidation
or plan of arrangement to which the Sub-Collateral Agent shall be a party,
shall be the successor Sub-Collateral Agent hereunder and under the Collateral
Agreement without the execution or filing of any paper, instrument or further
act to be done on the part of the parties hereto or thereto, provided that such
corporation meets the requirements set forth in this Agreement and the
requirements set forth for the Stock Trustee under the Stock Control Agreement.
10. Compensation. The Sub-Collateral Agent shall receive compensation and
reimbursement for reasonable expenses and disbursements from the Pledgor for
performing the usual, ordinary, normal and recurring services under this
Collateral Agency Agreement, as provided by a separate agreement between the
Pledgor and the Sub-Collateral Agent. None of the provisions of this
Collateral Agency Agreement shall require the Sub-Collateral Agent to expend
its own funds or otherwise incur financial liability in the performance of any
of its duties or in the exercise of any of its rights and powers. The
Sub-Collateral Agent may retain legal counsel and advisors in Canada and/or the
State of New York for the purpose of discharging its duties or determining its
rights under this Agreement, and may rely and act upon the advice of such
counsel or advisors. The Pledgor shall pay or reimburse the reasonable
expenses and disbursements of such counsel or advisors.
11. Section 17(f) Qualification. The Sub-Collateral Agent hereby
represents that it is an "Eligible Foreign Custodian," as defined in Rule
17f-5 of the Investment Company Act ("Rule 17f-5").
12. Sub-Collateral Agent's Limited Liability. The Pledgor shall indemnify
and hold the Sub-Collateral Agent harmless from and against any loss, damages,
cost or expense (including the costs of investigation, preparation for and
defense of legal and/or administrative proceedings related to a claim against
it and reasonable attorneys' fees and disbursements), liability or claim
incurred by reason of any act or omission in the course of, connected with or
arising out of any services to be rendered hereunder, provided that the
Sub-Collateral Agent shall
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not be indemnified and held harmless from and against any such loss, damages,
cost, expense, liability or claim arising from its willful misfeasance, bad
faith or gross negligence in the performance of its duties, or its reckless
disregard of its duties and obligations hereunder. This provision shall
survive the resignation or removal of the Sub-Collateral Agent or the
termination of this Agreement.
13. Rights of Set-Off; Banker's Lien. The Sub-Collateral Agent hereby
waives all rights of set-off or banker's liens it may have with respect to the
Multiple Voting Shares held by it as Sub-Collateral Agent hereunder.
14. Termination. This Agreement shall terminate upon the earlier of the
termination of the Trust or the appointment of a successor Sub-Collateral
Agent. Upon any termination of the Trust, the Sub-Collateral Agent together
with the Stock Trustee shall effect the immediate conversion of all Multiple
Voting Shares held by the Sub-Collateral Agent at such time into Subordinate
Voting Shares and deliver such Subordinate Voting Shares to the Collateral
Agent [in accordance with the irrevocable direction of the Company to issue the
Subordinate Voting Shares].
15. Choice of Law. This Agreement shall be deemed to executed and
delivered in the State of New York, and all laws or rules of construction
of the State of New York shall govern the right of the parties hereto and
the interpretation of the provisions hereof.
16. Notices. Any notice to be given to the Pledgor hereunder shall be in
writing and shall be duly given if mailed or delivered to [name of Pledgor],
_____________, Attention: ____________, Tel: _________, Fax: ___________; to
the Sub-Collateral Agent, Stock Control Trustee and Transfer Agent if mailed or
delivered to CIBC Mellon Trust Company, 000 Xxxxxxxxxx Xxxxxx, 0xx Xxxxx,
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0, Attention: Manager of Client Services, Tel:
(000) 000-0000, Fax: (000) 000-0000; to the Collateral Agent if mailed or
delivered to The Bank of New York, 000 Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxx X. Xxxxx, Tel: (000) 000-0000, Fax: (212)
000-0000; to the Company if mailed or delivered to Royal Group Technologies
Limited, 0 Xxxxx Xxxx Xxxxxxxxx, Xxxxxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0; and to
the Trust if mailed or delivered to DECS Trust II, c/o Puglisi & Associates,
000 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000; or at such other address
as shall be specified by the addressee to the other parties hereto in writing.
17. No Third Party Beneficiaries. Nothing herein, express or implied,
shall give to any person, other than the Pledgor, the Trust, the Sub-
Collateral Agent, the Collateral Agent and their respective successors and
assigns, any benefit of any legal or equitable right, remedy or claim
hereunder.
18. Amendments; Stock Control Agreement Changes; Waiver. This Agreement
shall not be deemed or construed to be modified, amended, rescinded, canceled
or waived, in whole or in part, except by a written instrument signed by a duly
authorized representative of all
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parties hereto. The Stock Trustee shall notify the Sub-Collateral Agent of any
change in the Stock Control Agreement prior to the effective date of any such
change. Failure of any party hereto to exercise any right or remedy hereunder
in the event of a breach hereof by any other party or parties shall not
constitute a waiver of any such right or remedy with respect to any subsequent
breach.
19. No Delegation. Nothing herein, express or implied, shall be deemed to
be a delegation by the Trust to the Collateral Agent of the duties and
responsibilities of a "Foreign Custody Manager" within the contemplation of
Rule 17f-5.
20. Counterparts. This Agreement may be signed in counterparts with all
counterparts constituting one and the same instrument.
21. Further Acts. The parties hereto shall do and perform and cause to be
done and performed such further and other acts and things as may be necessary
or desirable in order to give full effect to this Agreement.
22. Severability. If any provision, or portion thereof, of this Agreement,
or of the application thereof to any person or circumstances shall, to any
extent, be invalid or unenforceable, the remainder of this Agreement, or the
application of such provision or portion thereof, to any other person or
circumstance shall not be affected thereby and each provision of this Agreement
shall be valid and enforceable to fullest extent permitted by law.
23. Entire Agreement. This Agreement shall constitute the entire agreement
between the parties hereto with respect to the subject matter hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
_______________, as Pledgor
By:
Vic De Zen
as Director
DECS
Trust II
Xxxxxx X. Xxxxxxx
as Managing Trustee
The
Bank of New York, as Collateral
Agent
By:
Name: Xxxx X. Xxxxx
Title:
CIBC
Mellon Trust Company, as
Sub-Collateral Agent, Stock
Trustee and Transfer Agent
By:
Name:
Title:
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SCHEDULE A
Multiple Voting Shares
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SCHEDULE B
Irrevocable Direction
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