May 19, 2009 Canwest Media Inc. 31st Floor CanWest Global Place Winnipeg, MB R3B 3L7 Attention: General Counsel Dear Sirs:
May 19,
2009
31st
Floor
CanWest
Global Place
000
Xxxxxxx Xxxxxx
Winnipeg,
MB R3B 3L7
Attention:
General Counsel
Dear
Sirs:
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Re:
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Canwest
Media Inc. (the “Issuer”)
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Reference
is made to an extension agreement dated as of April 14, 2009 (the “Original Extension Agreement”)
between the Issuer, the guarantors party to the Indenture (as hereinafter
defined) as of the date hereof and listed on the signature pages hereto (the
“Guarantors”), and the
holders, or parties with discretionary authority to manage the funds of the
holders, of certain of the 8% senior subordinated notes due 2012 (collectively,
the “Notes”) issued
pursuant to the indenture dated as of November 18, 2004 (as amended, modified,
restated or supplemented from time to time, the “Indenture”) that are listed on
the signature pages hereto (such holders, or parties with discretionary
authority to manage the funds of the holders, being collectively, the “Noteholders”). All
capitalized terms used herein but not defined shall have the meanings ascribed
thereto in the Original Extension Agreement.
The
Original Extension Agreement was amended by an extension letter dated April 22,
2009 (the “Extension Agreement
No. 2”) and an extension letter dated May 5, 2009 (the “Extension Agreement No. 3”; the Original
Extension Agreement, as amended by Extension Agreement No. 2 and Extension
Agreement No. 3, are collectively the “Extension
Agreement”). Pursuant to Extension Agreement No. 3, the
Noteholders agreed not to demand payment of their Notes for a period ending on
May 19, 2009 (which date coincided with the expiry date of the Issuer’s waiver
agreement dated May 5, 2009 with the Senior Lenders), notwithstanding the
Issuer’s Interest Payment Default.
Certain
members of the Noteholders’ Committee, as purchasers (collectively, the “Purchasers”), together with
the Issuer and Canwest Television Limited Partnership, as issuers (collectively,
the “Note Issuers”), will enter into a
note purchase agreement (the “Note Purchase Agreement”)
contemporaneously with the entering into of this letter
agreement. Pursuant to the terms of the Note Purchase Agreement, the
Note Issuers will issue an aggregate $105,000,000 of notes to the
Purchasers for net proceeds of $100,000,000. The notes will bear
interest at 12% per annum, payable monthly, and have a maturity date of six
months after issuance.
The
Issuer has requested that the Noteholders further extend the period which they
would not demand payment of their Notes, and the Noteholders have agreed not to
exercise their rights and remedies available under the Indenture,
notwithstanding the occurrence of the Interest Payment Default which is
continuing, until the date and upon the terms and conditions set forth herein
(it being understood by the Parties hereto that the terms of the Extension
Agreement shall continue to be in full force and effect except as modified by
the terms of this letter agreement).
1. The
Original Extension Agreement is hereby amended as follows:
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(a)
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Recital
C is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(b)
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The
definition of “Extension Effective Date” in the Original Extension
Agreement is hereby deleted in its entirety and replaced with the
following:
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““Extension Effective Date” means the date upon
which executed copies of counterparts of this letter agreement have been
delivered to Xxxxxxxx by the Issuer, the Guarantors and the
Noteholders.”
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(c)
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Section
2(k) is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(d)
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Section
2(m) is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(e)
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The
date of “May 19, 2009” referred to in the definition of “Extension Period”
and in Sections 3 and 10(e) of the Original Extension Agreement is hereby
deleted and replaced with “June 15,
2009”.
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(f)
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The
words “except for the Senior Facility Covenant Breaches,” at the beginning
of Section 5(a)(ii) are hereby
deleted.
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(g)
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Section
5(a)(ii)(1) is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(h)
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Section
8(b) is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(i)
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Section
10(e) is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(j)
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Section
10(f) is hereby amended to remove the words “or the Senior Credit
Agreement”.
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(k)
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Section
10(g)(ii) is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(l)
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The
words “the Senior Credit Agreement” in Section 10(g)(vi) are hereby
deleted and replaced with “the Note Purchase Agreement, the CIT Credit
Agreement (as defined in the Note Purchase
Agreement)”.
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(m)
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The
word “or” at the end of Section 10(k) is hereby deleted and the period at
the end of Section 10(l) is hereby replaced with a
semi-colon.
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(n)
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The
following is hereby added as new Sections 10(m) and
(n):
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“(m)
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if
funding in accordance with the terms of the Note Purchase Agreement does
not occur on or before May 21, 2009;
or
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(n)
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an
event of default occurs and is continuing under the Note Purchase
Agreement.”
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(o)
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The
words “Sections 10(d), (e), (f), (g), or (h)” in clause (ii) of the full
paragraph at the end of Section 10 are hereby deleted and replaced with
the following: “Sections 10(d), (e), (f), (g), (h) or
(n)”.
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(p)
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The
words “Sections 10(i), (j) or (k)” in clause (iii) of the full paragraph
at the end of Section 10 are hereby deleted and replaced with the
following: “Sections 10(i), (j), (k) or
(m)”.
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2.
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Extension
Agreement No. 2 is hereby amended as
follows:
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(a)
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Section
3 is hereby deleted and replaced with “[Intentionally
deleted.]”.
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(b)
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Section
4 is hereby deleted and replaced with “[Intentionally
deleted.]”.
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3.
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Extension
Agreement No. 3 is hereby amended to replace the word “Houlihan” in
Section 3 with the words “Xxxxxxxx Xxxxx Xxxxxx & Xxxxx Capital, Inc.
(“Houlihan”)”.
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4.
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A
Statement of Projected Cash Flows for the period from May 19, 2009 to June
15, 2009 (the “Cash
Flows”) prepared by the Issuer has been delivered to Goodmans in
connection with this letter agreement. The Issuer covenants and
agrees to adhere in all material respects to the Cash Flows in the
operation of its business during the Extension Period, assuming that the
assumptions underlying the Cash Flows do not materially change during the
Extension Period.
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5.
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The
Issuer shall pay by the end of the business day on May 21, 2009
all invoiced fees and expenses of Xxxxxxxx and Xxxxxxxx (if any) that
remain outstanding.
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6.
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The
Issuer and each Guarantor hereby represents and warrants, severally and
not jointly, that the representations and warranties set forth in Section
5 of the Original Extension Agreement continue to be true and correct in
all respects as of the date hereof.
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7.
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The
Issuer and the Guarantors hereby ratify and reaffirm all of their payment
and performance obligations and obligations to indemnify, contingent or
otherwise, under the Indenture and the
Guarantees.
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8.
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Except
as expressly modified by the terms of this letter agreement, the terms of
the Extension Agreement shall continue to apply in full force and effect,
unamended. This letter agreement may not be modified or amended
except by a written instrument signed by the Issuer, the Guarantors and
each of the members of the Noteholders’ Committee at the time of the
execution of such written
instrument.
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9.
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This
letter agreement may be signed in counterparts, each of which, when taken
together, shall be deemed an original. Execution of this letter agreement
is effective if a signature is delivered by facsimile transmission or
electronic (e.g., pdf)
transmission.
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10.
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This
letter agreement shall be binding upon and enure to the benefit of the
Parties hereto and each of their respective successors and
assigns.
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11.
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If
any term or other provision of this letter agreement is invalid, illegal
or incapable of being enforced by any rule of law or public policy, all
other conditions and provisions of this letter agreement shall
nevertheless remain in full force and effect. Upon such determination that
any term or other provision is invalid, illegal or incapable of being
enforced, the Parties shall negotiate in good faith to modify this letter
agreement so as to effect the original intent of the Parties as closely as
possible in a mutually acceptable manner in order that the terms of this
letter agreement remain as originally contemplated to the fullest extent
possible.
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12.
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THIS
LETTER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE PROVINCE OF ONTARIO AND THE FEDERAL LAWS OF CANADA APPLICABLE
THEREIN, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH
PARTY SUBMITS TO THE JURISDICTION OF THE COURTS OF THE PROVINCE OF ONTARIO
IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS LETTER
AGREEMENT.
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13.
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The
Issuer and the Guarantors acknowledge and agree that any waiver or consent
that the Noteholders may make on or after the date hereof has been made by
the Noteholders in reliance upon, and in consideration for, the covenants,
agreements, representations and warranties of the Issuer and the
Guarantors hereunder.
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The above
terms are subject to the condition precedent that a fully signed copy of this
letter agreement signed by the Issuer and the Guarantors shall be provided to
Xxxxxxxx on behalf of the Noteholders prior to 11 a.m. on May 20, 2009, failing
which an immediate Event of Default shall occur without any further action on
the part of the Noteholders or the Trustee.
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remainder of this page has been intentionally left blank.]
\5725292
Letter Agreement
