Exhibit 4
THIS TRUST INDENTURE made as of the 22nd day of April 1998, in the City of
Montreal, Province of Quebec.
BETWEEN: SR TELECOM INC., a corporation incorporated under the
laws of Canada, having its head office in Montreal,
Province of Quebec;
(hereinafter referred to as the "Corporation");
OF THE FIRST PART;
AND: MONTREAL TRUST COMPANY, a trust company incorporated
under the laws of Canada and having an office in the
City of Montreal, Province of Quebec;
(hereinafter referred to as the "Trustee");
OF THE SECOND PART;
WHEREAS the Corporation considers it necessary for its corporate purposes to
create and issue its Debentures (as defined below) in the manner provided
herein;
WHEREAS the Corporation is duly authorized to create and issue the Debentures to
be issued as provided herein; and
WHEREAS the foregoing recitals are made as representations and statements of
fact by the Corporation and not by the Trustee.
NOW THEREFORE THIS INDENTURE WITNESSETH and it is hereby covenanted, agreed and
declared as follows:
ARTICLE 1
INTERPRETATION
1.1 DEFINITIONS
In this Trust Indenture, unless there is something in the subject
matter or context inconsistent therewith:
"Authorized Officers" means with respect to the Corporation, the
President, the Chief Financial Officer, the Secretary or any other
senior officer designated by a certificate signed by the President, the
Chief Financial Officer or the Secretary;
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"Business Day" means any day, other than Saturday, Sunday or any statutory
holiday in the City of Montreal, Province of Quebec;
"Canada Yield Price" means a price equal to the price of the Debentures
calculated to provide a yield to maturity, compounded semi-annually and
calculated in accordance with generally accepted financial practice, equal to
the Government of Canada Yield plus .75% on the Business Day preceding the date
of the decision the Corporation authorizing the redemption of the Debentures.
"Government of Canada Yield" on any date shall mean the yield to maturity on
such date, compounded semi-annually and calculated in accordance with generally
accepted financial practice, which a non-callable Government of Canada Bond
would carry if issued in Canadian dollars at 100% of its principal amount on
such date with a term to maturity equal to the remaining term to maturity of the
Debentures. The Government of Canada Yield, in the case of redemption of the
Debentures, will be the average of the yields provided by two registered
Canadian investment dealers selected by the Corporation;
"Certificate of the Corporation" means a certificate signed in the name of the
Corporation by any one of the Chairman, the President, the Chief Executive
Officer, the Chief Financial Officer or any Vice-President of the Corporation,
and may consist of one or more instruments so executed;
"Civil Code" means the Civil Code of Quebec which came into force on January 1,
1994 as amended from time to time, together with any regulations thereunder;
"Closing Date" means April 22, 1998;
"Consolidated Capitalization" means the consolidated capitalization of the
Corporation calculated in accordance with GAAP, but excluding from such
calculation Unrestricted Subsidiaries;
"Consolidated EBITDA" means Earnings before interest, taxes, depreciation and
amortization of the Corporation and its subsidiaries, but excluding therefrom
any Unrestricted Subsidiary;
"Consolidated Indebtedness" means the Indebtedness of the Corporation and of its
subsidiaries, excluding Indebtedness of Unrestricted Subsidiaries, as determined
by GAAP;
"Corporation" means the party of the first part and includes any successor
corporation to or of the party of the first part which shall have complied with
the provisions of Article 7;
"Counsel" means a lawyer or firm of lawyers retained by the Trustee or retained
by the Corporation and acceptable to the Trustee;
"CTR" means Comunicacion y Telefonia Rural S.A.;
"Debentures" means the 8.15% Debentures (senior unsecured) due April 22, 2005
issued hereunder;
"Debentureholders" or "Holders" means the Persons for the time being entered in
the registers mentioned hereinafter as holders of Debentures;
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"Debentureholders' Request" means an instrument signed in one or more
counterparts by the Holders of not less than 25% in principal amount of the
outstanding Debentures requesting the Trustee to take the action or proceeding
specified therein;
"Director" means a director of the Corporation for the time being and
"Directors" means the board of directors of the Corporation or, whenever duly
empowered, the executive committee (if any) of the board of directors of the
Corporation for the time being, and reference to action by the Directors means
action by the directors as a board or action by the executive committee of the
board as a committee;
"EBITDA" means Earnings before interest, taxes, depreciation and amortization
measured in accordance with GAAP;
"Event of Default" has the meaning ascribed thereto in Section 5.1;
"Extraordinary Resolution" has the respective meanings ascribed thereto in
Sections 8.12 and 8.15;
"Generally Accepted Accounting Principles" or "GAAP" means the generally
accepted accounting principles from time to time approved by the Canadian
Institute of Chartered Accountants and, as applicable, as at the date on which a
calculation has been made, is made or required to be made in accordance with
Generally Accepted Accounting Principles;
"Incur" means, with respect to any indebtedness or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
guarantee or otherwise become liable in respect of such Indebtedness or other
obligation or the recording, as required pursuant to GAAP or otherwise, of any
such Indebtedness or other obligation on the balance sheet of such person (and
"incurrence," "incurred," "incurable," and "incurring" shall have meaning
correlative to the foregoing); provided that a change in GAAP that results in an
obligation of such Person that exists at such time becoming Indebtedness shall
not be deemed an incurrence of such Indebtedness;
"Indebtedness" means and includes (i) any obligations for borrowed money, (ii)
obligations created or arising under any conditional sale or other title
retention agreement with respect to property acquired, (iii) guarantees of
obligations of others, and (iv) capital leases, but in any event shall not
include deferred revenue, Indebtedness incurred in the ordinary course of
business representing letters of credit, letters of guarantee, performance
bonds, interest in any currency or rate protection obligation for the account of
the Corporation or any Restricted Subsidiary, deferred income taxes and
non-controlling interests, the whole as calculated under GAAP;
"Indenture Legislation" has the meaning ascribed thereto in Section 10.1;
"Interest Conversion Factor" means the constant 0.69527;
"Interest Date" means, for any Debenture, any date on which interest on such
Debenture is payable in accordance with its terms and the terms of this
Indenture;
"Liens" means any mortgage, hypothecation, pledge, interest, encumbrance or
charge;
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"Life to Maturity" of the principal amount of any Debentures being redeemed or
accelerated means, as of the time of any determination thereof, the number of
years (rounded to the nearest one-twelfth) which will elapse between the date of
determination and April 22, 2005;
"Maturity Date" means the date on which the principal of such Debenture becomes
due and payable therein or herein provided, whether at Stated Maturity or by
declaration of acceleration or call for redemption or otherwise;
"Net Earnings" shall mean net earnings as determined by GAAP;
"Officer's Certificate" means a certificate signed in the name of the
Corporation by any one of the Chairman, the President, the Chief Executive
Officer, the Chief Financial Officer or any Vice-President of the Corporation,
and may consist of one or more instruments so executed;
"Paying Agent" means the Trustee designated by the Corporation to pay the
principal of or interest on any Debenture on behalf of the Corporation;
"Permitted Investments" means, without restricting any investments which may
otherwise be made by the Corporation in conformity with the provisions of this
Indenture, (i) an investment by the Corporation by way of cash in the equity of
CTR up to an amount of $50 million, and (ii) investments by way of cash in the
equity of Unrestricted Subsidiaries limited in the aggregate to the amount of
the proceeds derived from any additional equity offering of the Corporation or
any Unrestricted Subsidiary the terms of which contemplated expressly such use
of the proceeds;
"Person" means an individual, legal person, corporation, company, cooperative,
partnership, trust, unincorporated association or governmental body, and
pronouns have a similarly extended meaning;
"Place of Payment" has the meaning ascribed thereto in Section 2.6;
"Principal Conversion Factor" means the constant 0.69527;
"Record Date" means in respect of any Interest Date shall be a day no earlier
than the day on which the Trustee shall cease to register the transfer of
debentures as provided in Section 2.11;
"Redemption Date" when used with respect to any Debenture to be redeemed means
the date fixed for such redemption by or pursuant to this Indenture;
"Redemption Price" has the meaning ascribed thereto in Section 3.1;
"Reinvestment Rate" shall mean 0.75% plus the yield to maturity of the United
States Treasury obligations having a maturity (rounded to the nearest month)
corresponding to the Life to Maturity of the principal being redeemed or
accelerated on the Business Day preceding the date of the decision of the
Corporation authorizing the redemption or the date of the notice of
acceleration, as the case may be. The yield to maturity of the United States
Treasury obligations will be the average of the yields provided by two United
States registered investment dealers selected by the Corporation.
"Restricted Investments" means (i) any investment other than a Permitted
Investment by way of cash in the common stock of an Unrestricted Subsidiary or
(ii) any investment in securities other than
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short-term debt obligations issued by government entities or highly rated
corporations in the United States or Canada or certificates of deposit issued by
banking organizations in the United States or Canada with capital in excess of
$100,000,000;
"Restricted Payments" means the sum of (i) dividends and other distributions on
the share capital of the Corporation, (ii) any repurchases of the Corporation's
share capital, (iii) the making of any principal payment on or the purchase,
defeasance, repurchase, redemption, other acquisition or retirement for value,
pursuant to any scheduled maturity, scheduled repayment or scheduled sinking
fund payment, of any subordinated Indebtedness; (iv) the making of any
investment or guarantee of any investment in any Person other than a Permitted
Investment and (v) forgiveness of any indebtedness of an affiliate of the
Corporation or a Restricted Subsidiary;
"Restricted Subsidiary" means a subsidiary of the Corporation which is 50% or
more owned by the Corporation or a Restricted Subsidiary other than an
Unrestricted Subsidiary and includes all of the subsidiaries of the Corporation
existing as of the date hereof other than CTR. The Board of Directors of the
Corporation may designate any Unrestricted Subsidiary or any Person that is to
become a subsidiary as a Restricted Subsidiary if immediately after giving
effect to such action (and treating any acquired Indebtedness as having been
incurred at the time of such action), the Corporation could have incurred at
least $1.00 of additional Indebtedness (other than Permitted Indebtedness)
pursuant to Section 4.2.1;
"Settlement Amount" shall mean, with respect to the Swap related to any
Debentures, in determining the U.S. Make-Whole Amount, the net amount deemed
paid or received by the holder of such Debentures by reason of a termination (or
deemed termination) of such Swap, which shall be an amount equal to the
Settlement Amount as defined by the International Swap and Derivatives
Association, Inc.'s standard 1992 Multicurrency-Cross Border Master Agreement
(the "Master Agreement") where the parties have elected to calculate such amount
in accordance with Second Method payment method (as defined in the Master
Agreement) and Market Quotation payment measure (as defined in the Master
Agreement) and payable in U.S. Dollars;
"Shareholders' Equity" means the shareholders' equity of the Corporation as
determined by GAAP;
"Swap" shall mean, with respect to any Debentures, the cross-currency interest
rate swap obtained prior to the issuance thereof by the initial holder of such
Debentures, pursuant to which the right to receive Canadian dollars paid in
respect of such Debentures from the Corporation is exchanged for the right to
receive U.S. Dollars from a counterparty written notice of the terms of which
has been received from such holder by the Corporation on or prior to the date of
issuance of such Debentures (and the Corporation hereby acknowledges receipt of
such notice from each initial holder of Debentures); provided, however, that,
with respect to any Debentures, the Swap in effect on the date of original issue
shall continue to be the Swap referenced for the purpose of any determination of
U.S. Make-Whole Amount, regardless of whether, at the time of determination,
such Swap remains in effect or the related Debentures has been transferred to
another holder which is not a party to the Swap;
"Stated Maturity" when used with respect to any Debenture or any instalment of
interest thereon means the date specified in such Debenture as the fixed date on
which the principal of such Debenture or such instalment of interest is due and
payable;
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"Successor Corporation" has the meaning ascribed thereto in Section 7.1;
"this Indenture", "this Trust Indenture", "hereto", "hereby", "hereunder",
"hereof, "herein" and similar expressions refer to this Indenture and not to any
particular article, section, subsection, paragraph, subdivision or other portion
hereof, and include any and every supplemental indenture; and "supplemental
indenture" and "Indenture supplemental hereto" include any and every instrument
supplemental or ancillary hereto or in implementation hereof;
"Total Consolidated Assets" means the total consolidated assets of the
Corporation as determined by GAAP;
"Trustee" means the party of the second part and its successors for the time
being; and
"Unrestricted Subsidiary" means (a) any subsidiary which is 50% or more owned by
an Unrestricted Subsidiary and (b) any subsidiary of the Corporation which is
classified after the date hereof as an Unrestricted Subsidiary by a resolution
adopted by the Board of Directors of the Corporation; provided that a subsidiary
organized or acquired after the date hereof may be so classified as an
Unrestricted Subsidiary only if such classification is in compliance with the
covenant set forth under "Limitation on Restricted Payments". The Trustee shall
be given prompt notice by the Corporation of each resolution adopted by the
Board of Directors of the Corporation under this provision, together with a copy
of each such resolution adopted. The Corporation has elected to designate CTR as
an Unrestricted Subsidiary as of the date of execution of this Indenture;
"U.S. Make-Whole Amount" shall mean in connection with any redemption or
acceleration of any Debenture held by Holders whose registered address at the
date of the giving of the notice of redemption or notice of acceleration, as the
case may be is in the United States of America, the sum (whether positive or
negative) of (a) the excess, if any, of (i) aggregate present value as of the
date of such redemption or acceleration of each dollar of principal (in Canadian
dollars) being redeemed or accelerated (multiplied by the Principal Conversion
Factor) and the amount of interest (in Canadian dollars) (exclusive of interest
accrued to the date of redemption or acceleration) (multiplied by the Interest
Conversion Factor) that would have been payable in respect of such dollar if
such redemptions or acceleration had not been made, determined by discounting
such amounts in accordance with standard financial practices at the Reinvestment
Rate from the respective dates on which they would have been payable over (ii)
100% of the principal amount (in Canadian dollars) (multiplied by the Principal
Conversion Factor) of the outstanding Debentures being redeemed or accelerated;
provided however, that in no event shall the amount under (a) be less than zero,
plus (b) the Settlement Amount, deemed paid by (or less the Settlement Amount
deemed received by) the holder of such Debentures in connection with such
redemption or acceleration, such U.S. Make-Whole Amount to be paid in U.S.
Dollars.
"Written Order of the Corporation", "Written Request of the Corporation" and
"Written Direction of the Corporation" mean, respectively, an order, a request
or a direction signed in the name of the Corporation by any one of the Chairman,
the President, the Chief Executive Officer, the Chief Financial Officer or any
Vice-President of the Corporation, and may consist of one or more instruments so
executed.
Words importing the singular include the plural and vice versa and words
importing the masculine gender include the feminine gender and vice versa.
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1.2 MEANING OF "OUTSTANDING" FOR CERTAIN PURPOSES
Every Debenture certified and delivered by the Trustee hereunder shall
be deemed to be outstanding until it shall be cancelled or delivered to
the Trustee for cancellation, or a new Debenture shall be issued in
substitution therefor under Section 2.12, or moneys for the payment
thereof shall be set aside in trust under Section 3.6, Section 5.7 or
Section 6.2, provided that:
1.2.1 where a new Debenture has been issued in substitution for a
Debenture which has been mutilated, lost, stolen or destroyed,
only one of such Debentures shall be counted for the purpose
of determining the aggregate principal amount of Debentures
outstanding;
1.2.2 Debentures which have been partially redeemed or purchased
shall be deemed to be outstanding only to the extent of the
unredeemed or unpurchased part of the principal amount
thereof;
1.2.3 for the purpose of any provision of this Indenture entitling
Holders of outstanding Debentures to vote, sign consents,
requests or other instruments, take other action or to
constitute a quorum at any meeting of Holders under this
Indenture, Debentures owned legally by the Corporation, a
subsidiary or an affiliate of the Corporation (as defined in
the Canada Business Corporations Act) shall be disregarded,
except that:
(a) for the purpose of determining whether the Trustee
shall be protected in relying on any such vote,
consent, request or other instrument, other action or
to constitute a quorum at any meeting of Holders,
only the Debentures of which the Trustee has notice
that they are so owned shall be so disregarded; and
(b) Debentures so owned which have been pledged in good
faith other than to the Corporation, a subsidiary or
an affiliate of the Corporation shall not be so
disregarded if the pledgee shall establish to the
satisfaction of the Trustee the pledgee's right to
vote such Debentures in his discretion free from the
control of the Corporation.
1.3 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.
The division of this Indenture into articles, sections, subsections and
paragraphs, the provision of a table of contents and the insertion of
headings are for convenience of reference only and shall not affect the
construction or interpretation of this Indenture.
1.4 STATUTE REFERENCES
Any reference in this Indenture to a statute shall be deemed to be a
reference to such statute as amended, reenacted or replaced from time
to time.
1.5 MONETARY REFERENCES
Any reference in this Indenture to "Dollars", "dollars" or the sign "$"
shall be deemed to be a reference to lawful money of Canada.
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1.6 DAY NOT A BUSINESS DAY
In the event that any day on or before which any action is required to
be taken or any computation is required to be made hereunder is not a
Business Day, then such action or computation shall be required to be
taken or made on or before the requisite time on the first Business Day
thereafter.
1.7 INVALIDITY OF PROVISIONS
Each of the provisions contained in this Indenture or the Debentures is
distinct and severable and a declaration of invalidity or
unenforceability of any such provision by a court of competent
jurisdiction shall not affect the validity or enforceability of any
other provision hereof or thereof.
1.8 GOVERNING LAW
This Indenture and the Debentures shall be governed by and construed in
accordance with the laws of the Province of Quebec and the laws of
Canada applicable therein and shall be treated in all respects as
Quebec contracts.
1.9 TRUST CREATED WITHIN THE MEANING OF THE CIVIL CODE
Any trust created or constituted by the terms hereof (particularly
those created and constituted by sections 3.6, 5.7 or 6.2) and the
administration of such trusts shall be governed by and in accordance
with the provisions hereof (and, in particular Article 10) which, to
the extent permitted by applicable law, shall supersede any provisions
of applicable law (including, without limitation, those relating to the
administration of property of others), it being the intention of the
parties that this Indenture and the Debentures issued pursuant hereto
shall constitute the entire agreement of the parties.
Except as otherwise expressly provided or unless the context otherwise
requires, references in this Indenture to "trust" or "in trust", and
other similar wording shall only refer to any trust created or
constituted for the purposes of Section 3.6, 5.7 or 6.2, as the case
may be, which trust may be created or constituted in Quebec or in any
other appropriate jurisdiction and, if created or constituted in
Quebec, shall be subject to the provisions of the Civil Code applicable
to trusts and, if created or constituted in another appropriate
jurisdiction, shall be subject to the trust laws of such jurisdiction.
Any such trust shall automatically be created by the mere fact of the
transfer or the taking of possession by the Trustee of the property
subject to and for the purposes of such trust. The administration of
any such trust shall be governed by and in accordance with the
provisions hereof (and, in particular, in the case of the Trustee,
Article 10 hereof) which, to the extent permitted by applicable law,
shall supersede any provisions relating to the administration of
property of others or other similar provisions of any applicable law.
1.10 INDEMNITY OF U.S. HOLDERS
Without limiting the obligation of the Corporation to pay interest on
overdue interest pursuant to Section 2.5 or the rights of Holders under
Article 5, the Corporation agrees that if any U.S. Holder (as defined
in Section 3.1 hereof) is required to pay interest, penalties, costs
and expenses under its Swap (or any replacement thereof) as a result of
the Corporation calling for the redemption of such Debentures or of an
acceleration following an Event of Default, the Corporation shall
indemnify such U.S. Holder for all such amounts, without duplication.
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ARTICLE 2
GENERAL TERMS AND PROVISIONS OF DEBENTURES
2.1 FORM
The Debentures and the registrar's certificate of authentication shall
be in substantially the form set forth in Schedule A, with such
appropriate insertions, omissions, substitutions and other variations
as the Corporation may authorize and the Trustee may assent to and may
have such letters, numbers or other marks of identification and such
legends or endorsements placed thereon as may, consistently herewith,
be determined by the Authorized Officers executing such Debentures, as
evidenced by their signing of the Debentures. Any portion of the text
of any Debentures may be set forth on the reverse thereof. The
Debentures may also be in any other form permitted under the Canada
Business Corporations Act.
2.2 TITLE AND TERMS
The aggregate principal amount of Debentures which may be issued,
authenticated and delivered under this Indenture is $75,000,000 in
lawful money of Canada and such Debentures are hereby designated as
"8.15% Debentures due April 22, 2005".
The Debentures will rank pari passu in right of payment with all other
unsecured and unsubordinated present and future indebtedness of the
Corporation.
2.3 GENERALLY
Each Debenture will bear interest of 8.15% annually, payable
semi-annually in arrears, on April 22nd and October 22nd in each year,
commencing on October 22, 1998. The interest payable in respect of the
Debentures on October 22, 1998, will be such amount as has accrued from
the date of this Indenture to October 22, 1998. Interest on the
Debentures shall accrue from day to day and shall be calculated on the
basis of the actual number of days elapsed and on the basis of a year
of 365 days or 366 days in a leap year and shall be payable in lawful
money of Canada in the manner set forth in Section 2.5.
2.4 LEGENDS
The Debentures may contain or have endorsed thereon such provisions,
specifications and descriptive words not inconsistent with the
provisions of this Indenture as may be necessary or desirable to comply
with the rule of any securities exchange or commission, or otherwise,
as may be determined by the Corporation prior to the authentication and
delivery thereof. The certificates representing the Debentures sold to
purchasers in the United States will bear a legend to the following
effect, unless the Corporation determines otherwise in compliance with
applicable law:
"The securities evidenced hereby have not been registered
under the United States Securities Act of 1933, as amended
(the "Securities Act") and may not be offered, sold, pledged
or otherwise transferred except (a) (1) to a person who the
seller reasonable believes is a qualified institutional buyer
within the
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meaning of Rule 144A under the Securities Act purchasing for
its own account or for the account of a qualified
institutional buyer in a transaction meeting the requirements
of Rule 144A, (2) in an offshore transaction complying with
Rule 903 or 904 of Regulation S under the Securities Act, or
(3) pursuant to an exemption for registration under the
Securities Act provided by Rule 144 thereunder (if available)
and (b) in accordance with all applicable securities laws of
the states of the United States;"
provided that, if any such Debentures are being sold under clause (2)
above in accordance with Rule 904 of Regulation S, the legend may be
removed by providing a declaration to the Registrar and transfer agent
for the Debentures, to the following effect (or as the Corporation may
prescribe from time to time, and provided that the Corporation may at
any time rescind this procedure for the removal of restrictive legends
if this procedure no longer complies with applicable legal
requirements):
The undersigned(s) acknowledges that the sale of the
represented by certificate numbers ______ to which this
declaration is being made in reliance on Rule 904 of
Regulation S under the United States Securities Act of 1933
(the "Securities Act") and (b) certifies that (1) it is not an
"affiliate" (as defined in Rule 405 under the Securities Act)
of this Corporation, (2) the offer of such Debentures was not
made to a person in the United States and either (a) at the
time the buy order was originated, the buyer was outside the
United States or the seller and any person acting on its
behalf reasonably believe that the buyer was outside the
United States, or (b) the transaction was executed on or
through the facilities of The Toronto Stock Exchange or the
Montreal Exchange and neither the seller or any person acting
on its behalf knows that the transaction has been prearranged
with a buyer in the United States, (3) neither the seller nor
any person acting on its behalf engaged in any directed
selling efforts in connection with the offer and sale of such
Debentures, (4) the sale is bona fide and not for the purpose
of "washing off" the resale restrictions imposed because the
Debentures are "restricted securities" (as such term is
defined in Rule 144(a)(3) under the Securities Act), and (5)
the contemplated sale is not a transaction or part of a series
of transactions which, although in technical compliance with
Regulation S is part of a plan of scheme to evade the
registration provisions of the Securities Act. Terms used
herein have the meanings given to them by Regulation S;
and provided further that the legend may be removed by delivery to the
Corporation of an opinion of counsel, of recognized standing reasonably
satisfaction to the Corporation to the effect that such legend is no
longer required under applicable requirements of the Securities Act and
state securities laws.
2.5 CONCERNING INTEREST
2.5.1 Every Debenture, whether issued originally or in exchange for
other Debentures, shall bear interest from and including April
22, 1998 or from and including the last Interest Date to which
interest shall have been paid or made available for payment on
the Debentures, whichever is later.
2.5.2 Interest on such Debenture shall cease to accrue on the
earliest of April 22, 2005 or, if such Debenture is called for
redemption, the Redemption Date unless, upon due
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presentation on or after April 22, 2005 or the Redemption
Date, as the case may be, such payment is improperly withheld
or refused.
2.6 PLACE AND MEDIUM OF PAYMENT
2.6.1 As payments in respect of principal and interest on the
Debentures become due, the Corporation shall (except in cases
of payments of interest and of principal at maturity of the
principal which may, at the option of the Corporation, shall
be made only upon presentation and surrender of the Debenture
at Stated Maturity of the principal amount of the Debentures):
(a) deliver or cause to be delivered to the principal
office of the Trustee as Paying Agent in the City of
Montreal, a cheque for the amount of such payment
(less any tax required to be deducted, if any)
payable on such Interest Date or Stated Maturity of
the principal amount of the Debentures, to the order
of the Trustee and negotiable at par; or
(b) provide to the Trustee as the Paying Agent such
payment by electronic funds transfer (less any tax
required to be deducted, if any) on or before 10:00
a.m. on the applicable Interest Date or Stated
Maturity of the principal amount of the Debentures.
2.6.2 Upon receipt of the payments set forth in Section 2.6.1, the
Trustee shall forward or cause to be forwarded to each Holder
a cheque in the amount of the payment, at his or her address
appearing in the register maintained by the Trustee pursuant
to Section 2.8, payable to the order of such holder or holders
and negotiable at par. In the case of joint holders, payment
shall be made in the names of all holders.
2.6.3 The forwarding of such cheque shall satisfy and discharge the
liability for the interest or principal upon such Debentures
to the extent of the sums represented thereby (plus the amount
of any tax deducted as aforesaid) unless such cheque be not
paid on presentation. In the event of the non-receipt of such
cheque by such registered holder or the loss or destruction
thereof, the Trustee, upon being furnished with reasonable
evidence of such non-receipt, loss or destruction and an
indemnity in the amount and form reasonably satisfactory to
it, shall issue or cause to be issued to such holder a
replacement cheque for the amount of such cheque. The
Corporation, in lieu of forwarding, or causing to be
forwarded, any such cheque in payment of interest, may agree
with any holder of Debentures to pay interest to or to the
order of such holder at any place at which interest on such
Debentures is payable, and shall provide a certified copy of,
or relevant extract from, any such agreement to the Trustee.
2.7 DENOMINATIONS
The Debentures shall be in the denominations of $1,000 and integral
multiples thereof in Canadian currency.
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2.8 NEGOTIABILITY, TRANSFER AND REGISTRY
2.8.1 The Corporation shall cause to be kept by and at the principal
corporate trust office of the Trustee in the City of Montreal,
Quebec or at such other place or places (if any) as the
Corporation may designate with the approval of the Trustee,
and by the Trustee (the registers maintained for such purposes
in such office and at such other place or places being herein
sometimes collectively referred to as the "Register") in
which, subject to such reasonable regulation as the
Corporation or the Trustee or such other registrar may
prescribe, shall be entered the names and addresses of the
holders of Debentures and particulars of the Debentures held
by them. The Trustee is hereby appointed registrar for the
purpose of registering registered Debentures and transfers
thereof as herein provided.
2.8.2 No transfer of a fully registered Debenture shall be valid
unless made on one of the registers therefor by the registered
holder thereof or his executors, administrators or other legal
representatives or by his attorney duly appointed by an
instrument in writing in form and execution satisfactory to
the Trustee or other registrar, upon surrender of such
Debenture together with a written instrument of transfer
satisfactory to the Trustee or other registrar and duly
executed by such registered holder or such legal
representatives or such duly authorized attorney and upon
compliance with such reasonable requirements as the Trustee or
other registrar may prescribe and upon payment by (or on
behalf of) such registered holder of any charges which the
Corporation or the Trustee may make as provided in this
Section. Upon the surrender for registration of transfer of
any such registered Debenture, the Corporation shall execute
and the Trustee shall authenticate such Debentures, a new
fully registered Debenture, registered in the name of the
transferee, of the same aggregate principal amount, maturity
and interest rate as the surrendered Debenture. After the
appropriate form of transfer is lodged with the Trustee or
other registrar and upon compliance with all other conditions
in that regard required by this Indenture, or by law, the
transferee of a registered Debenture shall be entitled to be
entered on the registrar as the holder of such Debenture free
from all rights of set-off or counterclaim between the
Corporation and his or her transferor or any previous holder
of such Debenture.
2.8.3 The Corporation may deem and treat the Person in whose name
any fully registered Debenture is registered as the absolute
owner thereof, whether such Debenture shall be overdue or not,
for all other purposes, and neither the Corporation shall be
affected by any notice to the contrary. Payment of, or on
account of, the principal or Redemption Price, if any, of any
fully registered Debenture, or the interest on such Debenture,
shall be made only to, or upon the order of, the registered
holder thereof. All such payments shall be valid and effective
to satisfy and discharge the liability upon such Debenture in
respect of such principal or interest to the extent of the sum
or sums so paid.
2.9 OWNERSHIP OF DEBENTURES
2.9.1 The Holder of any Debenture shall be deemed to be the owner
thereof for all purposes of this Indenture and payment of or
on account of the principal of, and interest on, such
Debenture shall be made only to or upon the order in writing
of the Holder thereof and such payment shall be complete
satisfaction for the amounts so paid and discharge to the
Trustee, any registrar of Debentures and the Corporation for
the amounts so paid;
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2.9.2 the Holder of any Debenture shall be entitled to the principal
and interest evidenced by such Debenture, free from all rights
of compensation, set-off or counterclaim between the
Corporation and any prior Holder thereof and all Persons may
act accordingly. A transferee of a Debenture shall, upon
compliance with all of the requirements for the transfer of
Debentures set out in this Indenture, in the Debenture or
established by the Trustee or the Corporation pursuant thereto
and any other requirements of law with respect to such
transfer, be entitled to be entered on the appropriate
register or on any one of the appropriate registers as the
owner of such Debenture, free from all rights of compensation,
set-off or counterclaim between the Corporation and the
transferor or any previous Holder thereof.
2.10 EXCHANGE OF DEBENTURES
2.10.1 Debentures of any denomination may be exchanged for Debentures
of any other authorized denomination or denominations of an
equivalent aggregate principal amount. Exchanges of Debentures
may be made at the principal offices of the Trustee in
Montreal. Any Debentures tendered for exchange shall be
surrendered to the Trustee and shall be cancelled. The
Corporation shall execute, and the Trustee shall certify, all
Debentures necessary to carry out such exchanges;
2.10.2 Debentures issued in exchange for Debentures which at the time
of such issue have been selected or called for redemption at a
later date shall be deemed to have been selected or called for
redemption in the same manner as the Debentures for which they
were exchanged and, upon issuance of such Debentures the
Trustee shall note thereon a statement to that effect;
2.10.3 except as otherwise provided herein, upon any exchange of
Debentures of any denomination for Debentures of any other
authorized denominations and upon any transfer of Debentures,
the Trustee or other registrar of Debentures may charge the
Holder or the transferor such reasonable fee as may be
necessary to discharge any stamp tax, security transfer tax or
other governmental charge required to be paid and payment of
such charges shall be made by the party requesting such
exchange or transfer as a condition precedent thereto;
2.10.4 neither the Corporation, the Trustee nor any other registrar
of Debentures shall be required to exchange any Debentures on
the day of any selection by the Trustee of any Debentures to
be redeemed or during the period following the notice to be
given by the Trustee of such redemption. Debentures which at
the time of such exchange shall have been selected or called
for redemption at a later date shall be deemed to have been
selected or called for redemption in the same manner and shall
have noted thereon a statement to that effect.
2.11 REGULATIONS WITH RESPECT TO EXCHANGES AND TRANSFERS
In all cases in which the privilege of exchanging Debentures or
registering the transfer of Debentures is exercised, the Corporation
shall execute and the Trustee shall authenticate and deliver Debentures
in accordance with the provisions of this Indenture. Subject to Section
2.13.2 all registered Debentures surrendered for exchange or
registration of transfer shall forthwith be cancelled by the Trustee.
For every exchange or registration of transfer of Debentures, whether
temporary or
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definitive, the Corporation or the Trustee, as a condition precedent to
the privilege of making such exchange or registration of transfer, may
make a charge sufficient to reimburse it for any tax, or other
government charge required to be paid with respect to such exchange or
registration of transfer. A reasonable charge shall be made to the
Holder in connection with such exchange or registration of transfer to
pay the cost of preparing each new Debenture issued upon such exchange
or registration of transfer. Neither the Corporation nor the Trustee
shall be required to exchange or register the transfer of Debentures
for a period often (10) days next preceding an Interest Date for the
Debentures.
2.12 DEBENTURES MUTILATED, DEFACED, DESTROYED, STOLEN OR LOST
In case any Debenture shall become mutilated or defaced, or be
destroyed, stolen or lost, the Corporation shall, subject to applicable
law, execute, and thereupon the Trustee, at its principal corporate
trust office, shall authenticate and deliver, a new Debenture of like
date and tenor so mutilated, defaced, destroyed, stolen or lost, in
exchange and substitution for such mutilated or defaced Debenture, upon
surrender and cancellation thereof, or in lieu of and substitution for
such destroyed, stolen or lost Debenture, upon filing with the Trustee
evidence satisfactory to the Corporation and the Trustee in their
discretion that such Debenture has been destroyed, stolen or lost and
proof of ownership thereof, and upon furnishing the Corporation and the
Trustee with an indemnity in amount and form satisfactory to them in
their discretion and complying with such other reasonable terms and
conditions as the Corporation and the Trustee may prescribe and paying
such reasonable charges and expenses as the Corporation and Trustee may
incur in connection herewith. All mutilated or defaced Debentures
surrendered to the Trustee pursuant to this Section shall be cancelled
by it. Any new Debenture authenticated and delivered pursuant to this
Section in substitution for a Debenture mutilated or defaced or alleged
to be destroyed, stolen or lost shall constitute original contractual
obligations on the part of the Corporation, whether or not the
Debenture so alleged to be destroyed, stolen, or lost, constitutes
contractual obligations at any time enforceable by anyone. Any new
Debenture authenticated and delivered pursuant to this Section shall be
entitled to all the benefits of this Indenture.
2.13 PREPARATION OF DEFINITIVE DEBENTURES AND TEMPORARY DEBENTURES
2.13.1 Pending the preparation and delivery to the Trustee of
definitive Debentures, if any, the Corporation may execute in
lieu thereof (in the same manner as is provided in Section
2.15 but subject to the provisions, conditions and limitations
set forth in this Section 2.13.1, and, upon the Written
Request of the Corporation, the Trustee shall authenticate and
deliver, one or more temporary Debentures which are printed,
lithographed, typewritten or otherwise produced, in such form
and in any authorized denomination, substantially of the tenor
of the definitive Debentures in lieu of which such temporary
Debentures are issued and with such appropriate omissions,
insertions, substitutions and other variations as the Trustee
or any Authorized Officers executing such temporary Debentures
may approve, such approval to be conclusively evidenced by the
execution thereof by the Corporation (in the manner provided
in Section 2.15) and the authentication and delivery thereof
by the Trustee. Any such temporary Debentures shall entitle
the holders thereof to definitive Debentures in any authorized
denomination when the same are prepared and ready for
delivery.
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2.13.2 Without unreasonable delay after the issuance of any temporary
Debentures, the Corporation shall cause to be prepared the
appropriate definitive Debentures for delivery to the holders
of such temporary Debentures. After the preparation of
definitive Debentures, the temporary Debenture shall be
exchangeable for definitive Debentures upon surrender of such
temporary Debenture or Debentures at the principal corporate
trust office of the Trustee, without charge to the holder
thereof. Upon surrender of any such temporary Debenture, the
Corporation shall execute and the Trustee shall authenticate
and deliver in exchange for all or any part of such temporary
Debenture, one or more definitive Debentures, of any
authorized denomination and of like tenor and for an aggregate
principal amount equal to the aggregate principal amount of
the temporary Debenture or part thereof that is being
exchanged for such definitive Debenture or Debentures, and if
part only of such temporary Debenture is being exchanged for
such definitive Debenture or Debentures, together with such
temporary Debenture with the reduction of the principal amount
thereof endorsed thereon or on a schedule annexed thereto by
the Trustee or such Paying Agent or together with a new
temporary Debenture or Debentures, executed by the Corporation
and authenticated and delivered by the Trustee, of any
authorized denomination and of like tenor and for an aggregate
principal amount equal to the remaining principal amount of
the surrendered temporary Debenture or Debentures. Upon the
exchange of the entire principal amount of a temporary
Debenture for definitive Debentures or for definitive
Debentures together with new temporary Debentures, the
temporary Debenture so exchanged shall be cancelled. Until
exchanged for definitive Debentures, the temporary Debenture
shall in all respects be entitled to the same benefits and
security under this Indenture as definitive Debentures.
2.14 CANCELLATION AND DESTRUCTION OF DEBENTURES
All Debentures paid or redeemed, either at or before maturity, shall be
delivered to the Trustee when such payment or redemption is made, and
such Debentures, together with all Debentures purchased by the
Corporation, shall thereupon be promptly cancelled. No Debentures shall
be authenticated in lieu of or in exchange for any Debentures cancelled
as provided in this Section 2.14, except as expressly permitted under
this Indenture. Debentures so cancelled may at any time be incinerated
or otherwise destroyed by the Trustee, who shall execute a certificate
of incineration or destruction in duplicate by the signature or one of
its authorized officers describing the Debentures so incinerated or
otherwise destroyed, and one executed certificate shall be filed with
the Corporation and the other executed certificate shall be retained by
the Trustee.
2.15 EXECUTION
2.15.1 The Debentures shall be executed in the name, and on behalf,
of the Corporation by the manual or facsimile signature of any
two Authorized Officers. Debentures bearing such facsimile
signatures shall be binding upon the Corporation as if they
had been manually signed by such Authorized Officers.
2.15.2 In case any officer whose signature, or a facsimile of whose
signature, shall appear on any Debentures shall cease to be an
Authorized Officer before authentication and delivery of such
Debentures by the Trustee, such Debentures shall nevertheless
be valid and binding upon the Corporation for all purposes as
if such officer had not ceased to be an Authorized Officer.
Any Debenture may be signed on behalf of the Corporation by
any Person, who,
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on the date of such act, shall be an Authorized Officer,
notwithstanding that at the date of such Debenture such Person
may not have been an Authorized Officer.
2.15.3 The Corporation may from time to time adopt and use for that
purpose the facsimile signature of any Person who shall be an
Authorized Officer at the time the Corporation adopts such
signature for such purpose notwithstanding that at the date of
such Debenture such person may not be an Authorized Officer or
that at the time such Debentures shall be authenticated and
delivered such person may have ceased to be an Authorized
Officer.
2.16 AUTHENTICATION
2.16.1 The Debentures shall bear thereon a certificate of
authentication executed manually by the Trustee. No Debenture
shall be issued or, if issued, shall be obligatory or entitle
the holder to any right or benefit under this Indenture or
shall be valid or obligatory for any purpose until such
certificate of authentication shall have been duly executed by
the Trustee. Such certificate of the Trustee upon the
Debentures executed by or on behalf of the Corporation shall
be conclusive evidence as against the Corporation that the
Debentures so authenticated have been duly executed,
authenticated and delivered under this Indenture and is a
valid and binding obligation of the Corporation and that the
holder thereof is entitled to the benefits of this Indenture.
2.16.2 The certificate of the Trustee on Debentures shall not be
construed as a representation or warranty by the Trustee as to
the validity of this Indenture or of the Debentures (except
the due certification thereof and any other warranties implied
by law) and the Trustee shall in no respect be liable or
answerable for the use made of the Debentures or any of them
or of the proceeds thereof.
ARTICLE 3
REDEMPTION OF DEBENTURES
3.1 REDEMPTION OF DEBENTURES
Upon compliance with the other provisions of this Article 3, the
Corporation shall have the right, at any time and from time to time, of
redeeming the outstanding Debentures on any Business Day, either in
whole or in part (but if in part then such redemption shall be applied
against the Debentures held by Holders whose registered address at the
date of the giving of the notice of redemption are located in the
United States of America and have entered into a Swap (the "U.S.
Holders") and the Debentures held by Holders whose registered address
at the date of the giving of the notice of redemption are located in
Canada (the "Canadian Holders") in proportion to the aggregate
principal amount outstanding of each such Debentures and in a minimum
aggregate principal amount of $1,000,000) by:
(a) in the case of U.S. Holders, payment of the sum of:
(i) the principal amount of the Debentures or a portion
thereof to be redeemed, multiplied by the Principal
Conversion Factor;
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(ii) the accrued interest thereon to the Redemption Date
multiplied by the Interest Conversion Factor; and
(iii) an amount equal to the U.S. Make-Whole Amount,
determined as of the Business Day preceding the
decision of the Corporation authorizing the
redemption:
such sum of (i), (ii) and (iii) being payable in U.S. Dollars
or
(b) in the case of the Debentures held by Canadian Holders,
payment of a Redemption Price equal to the greater of 100% of
the principal amount thereof and the Canada Yield Price;
together in each case with accrued interest, if any, to the Redemption
Date (the amount so payable in either case being the "Redemption
Price").
The Corporation will give notice of redemption at least 30 days but not
more than 60 days before the date fixed for redemption.
3.2 PARTIAL REDEMPTION OF DEBENTURES
If less than all the Debentures are to be redeemed, the Corporation
shall in each such case, at least 15 days before the date upon which
notice of redemption is to be given, notify the Trustee by Written
Direction of the Corporation of its intention to redeem Debentures and
of the aggregate principal amount of Debentures to be redeemed. All
partial redemptions pursuant to this Section 3.2 shall be applied on
all outstanding Debentures rateably in accordance with the unpaid
principal amounts thereof.
The Holder of any Debenture called for redemption in part only, upon
surrender of such Debenture for payment, shall be entitled to receive,
without expense to such Holder, a new Debenture for the unredeemed part
of the Debenture so surrendered, and the Corporation shall execute and
the Trustee shall authenticate and deliver, at the expense of the
Corporation, such new Debenture upon receipt of the Debenture so
surrendered.
3.3 NOTICE OF REDEMPTION
Notice of intention to redeem any Debentures shall be given by or on
behalf of the Corporation to the Holders of Debentures which are to be
redeemed, not more than 60 days and not less than 30 days prior to the
date fixed for redemption, in the manner provided in Article 9. The
notice of redemption shall, unless all the Debentures then outstanding
are to be redeemed, specify the distinguishing letters and numbers of
the Debentures which are to be redeemed and, if a Debenture is to be
redeemed in part only, shall specify that part of the principal amount
thereof to be redeemed, and shall specify the Redemption Date, the
Redemption Price and places of payment and shall state that all
interest on the Debentures called for redemption shall cease to accrue
from and after such Redemption Date.
3.4 DEBENTURES DUE ON REDEMPTION DATE
Upon notice having been given as aforesaid, the Debentures so called
for redemption shall thereupon become due and payable at the Redemption
Price and on the Redemption Date specified in such
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notice, in the same manner and with the same effect as if it were the
Maturity Date specified in such Debentures, notwithstanding anything
contained therein or herein to the contrary, and from and after such
Redemption Date, if the moneys necessary to redeem such Debentures
shall have been deposited as hereinafter provided and affidavits or
other proof satisfactory to the Trustee as to the mailing of such
notices shall have been delivered to it, such Debentures shall not be
considered as outstanding hereunder and interest upon such Debentures
shall cease to accrue after such date, subject to the provisions of
Section 3.2.
If any question shall arise as to whether notice of redemption or
deposit of the redemption moneys has been given or made as provided
above, such question shall be decided by the Trustee whose decision
shall be final and binding upon all parties in interest.
3.5 DEPOSIT OF REDEMPTION MONEYS
Upon Debentures having been called for redemption, the Corporation
shall deposit with the Trustee, prior to the Redemption Date fixed in
the relevant notice of redemption, such sums as may be sufficient to
pay the Redemption Price of the Debentures to be redeemed, together
with a sum sufficient to pay estimated charges and expenses which may
be incurred by the Trustee in connection with such redemption. From the
sums so deposited the Trustee shall pay or cause to be paid to the
Holders of the Debentures called for redemption, upon surrender of such
Debentures, the principal and interest to which they are respectively
entitled on redemption.
3.6 FAILURE TO SURRENDER DEBENTURES CALLED FOR REDEMPTION
If the Holder of any Debentures called for redemption shall, within 30
days from the date fixed for redemption, fail to surrender any of such
Debentures or shall not within such time accept payment of the
Redemption Price payable in respect thereof or give such receipt
therefor, if any, as the Trustee may require, such Redemption Price
shall be set aside in trust for such Holder, in accordance with Section
10.14, and such setting aside shall for all purposes be deemed a
payment to the Debentureholder of the sum so set aside, and to that
extent such Debentures shall thereafter not be considered as
outstanding hereunder and the Debentureholder shall have no right
except to receive payment out of the moneys so paid and deposited, upon
surrender of his Debentures, of the Redemption Price of such
Debentures, without interest thereon.
3.7 SURRENDER OF DEBENTURES FOR CANCELLATION
If the principal moneys due upon any Debenture shall become payable by
redemption or otherwise before the Maturity Date, the Person presenting
such Debenture for payment must surrender the same for cancellation,
the Corporation nevertheless paying or causing to be paid the interest
accrued and unpaid thereon (computed on a per diem basis if the date
fixed for payment is not an interest payment date).
3.8 PURCHASE FOR CANCELLATION
At any time when the Corporation is not in default hereunder, it may
purchase for cancellation all or any Debentures in the market or by
tender or by private contract, at prices and upon such terms and
conditions as the Corporation in its sole discretion may determine.
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3.9 CANCELLATION OF DEBENTURES
All Debentures redeemed and all Debentures purchased under this Article
3 shall forthwith be delivered to the Trustee and shall be cancelled by
it and no Debentures shall be issued in substitution therefor.
ARTICLE 4
COVENANTS OF THE CORPORATION
4.1 GENERAL COVENANTS
The Corporation covenants with the Trustee for the benefit of the
Trustee and the Debentureholders as follows:
4.1.1 the Corporation will duly and punctually pay or cause to be
paid to every Debentureholder the principal of and interest
accrued on the Debentures of which he is the Holder
(including, in the case of default, interest on the amount in
default) on the dates, at the places, in the currency, and in
the manner mentioned herein and in the Debentures;
4.1.2 except as herein otherwise expressly provided, the Corporation
will at all times maintain its corporate existence and at all
reasonable times it will furnish or cause to be furnished to
the Trustee or its duly authorized agent or attorney such
information relating to its business as the Trustee may
reasonably require and such books of account shall at all
reasonable times be open for inspection by the Trustee or such
agent or attorney;
4.1.3 the Corporation will furnish to the Trustee a copy of all
financial statements, whether annual or interim, of the
Corporation and the report, if any, of the Corporation's
auditors thereon and of all annual and other periodic reports
of the Corporation furnished to its shareholders at the same
time as they are furnished to such shareholders;
4.1.4 the Corporation will deliver to the Trustee on or before 120
days after the end of each fiscal year of the Corporation and
or before 45 days after the end of each of the first, second
and third fiscal quarters in each year an Officer's
Certificate stating that, in the course of the performance by
the signer of his duties as officer of the Corporation, he
would normally have knowledge of any default by the
Corporation in the performance of its covenants under this
Indenture or of any Event of Default under Article 5 and
certifying that the Corporation has complied with all
covenants, conditions or other requirements contained in this
Indenture, non-compliance with which would, with notification
or lapse of time or otherwise, constitute an Event of Default
hereunder, or, if such is not the case, setting forth with
reasonable particulars the circumstances of any failure to
comply.
In addition, on becoming aware at any time of any Event of
Default of the nature specified in Section 5.1.5, the
Corporation will promptly notify the Trustee; and
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4.1.5 the Corporation will duly and punctually perform and carry out
all of the acts or things to be done by it as provided in this
Indenture.
4.2 SPECIFIC COVENANTS
During the period of time the Debentures are outstanding, the
Corporation and its Restricted Subsidiaries, as measured on a
consolidated basis, shall comply with the following limitations:
4.2.1 Limitation on Incurrence of Additional Indebtedness
As long as the Debentures remain outstanding, the Corporation
will not and will not permit its Restricted Subsidiaries to,
directly or indirectly, incur additional Indebtedness unless,
after giving effect to the incurrence of such Indebtedness and
the receipt and application of the proceeds thereof:
(a) Consolidated Indebtedness to Consolidated EBITDA for
the period comprised of the four consecutive
completed fiscal quarters ended immediately prior to
the incurrence of such Indebtedness, would be less
than 4:1; and
(b) Consolidated Indebtedness as a percentage of
Consolidated Capitalization would be less than 50%;
provided further, that no Event of Default shall have occurred
and be continuing at the time or as a consequence of the
incurrence of such Indebtedness.
4.2.2 Limitation on Restricted Payments
The Corporation will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, at any
time, declare or make, any Restricted Payment unless: (a) no
Event of Default shall have occurred and be continuing at the
time of or immediately after giving effect to such Restricted
Payment; and (b) immediately after giving effect to such
action the aggregate amount of Restricted Payments of the
Corporation and its Restricted Subsidiaries declared or made
on or after the Closing Date, would not exceed the sum of (i)
$5,000,000; plus (ii) 50% of Net Earnings during the period
commencing on or after the Closing Date and ending on the date
which is the last day of the latest quarter for which
consolidated financial statements of the Corporation are
available and preceding the date of such Restricted Payment
(minus 100% of Net Earnings for such period if Net Earnings is
a loss); and plus (iii) the aggregate amount of net proceeds
of any offering of equity shares of the Corporation or its
Restricted Subsidiaries after the Closing Date.
For purposes of determining under this subsection the amount
expended for Restricted Payments, cash distributed shall be
valued at the face amount thereof and property other than cash
shall be valued at its fair market value as determined by the
board of directors of the Corporation.
Notwithstanding the foregoing, the provisions of this
subsection shall not prohibit:
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(i) the payment of any distribution within 60 days after the date
of declaration thereof, if at such date of declaration such
payment would comply with the provisions of this Indenture;
(ii) the retirement of any equity shares of the share capital of
the Corporation or subordinated Indebtedness by conversion
into, or by or in exchange for equity shares of the share
capital of the Corporation, or out of, the net proceeds of the
substantially concurrent sale of other equity shares of the
share capital of the Corporation;
(iii) the redemption or retirement of Indebtedness of the
Corporation subordinated to the Debentures in exchange for, by
conversion into, or out of the net proceeds of, a
substantially concurrent sale or incurrence of Indebtedness of
the Corporation that is contractually subordinated in right of
payment to the Debentures to at least the same extent as the
subordinated Indebtedness being redeemed or retired.
Not later than the date of making any Restricted Payment, the
Corporation will deliver to the Trustee a Certificate of the
Corporation stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by the
"Limitation on Restricted Payments" covenant were computed, which
calculations may be based upon the Corporation's latest available
financial statements, and that no default or Event of Default exists
and is continuing and no Event of Default will occur immediately after
giving effect to any Restricted Payments.
4.2.3 Minimum Shareholders' Equity
The Corporation will at all times maintain Shareholders' Equity in
excess of $90,000,000.
4.2.4 Limitation on Restricted Investments
The Corporation will not be permitted to make any Restricted Investment
if after giving effect to such Restricted Investment the aggregate
amount of Restricted Investments exceeds 10% of Consolidated
Capitalization; provided, however, that the Corporation shall in no
event be prevented from making investments that are Permitted
Investments under the Indenture.
4.2.5 Limitation on Indebtedness of Restricted Subsidiaries
The Corporation will not permit its Restricted Subsidiaries to become
liable in respect to any Indebtedness if the sum of such Indebtedness
exceeds in the aggregate 10% of Consolidated Capitalization.
4.2.6 Limitation on Liens
The Corporation will not, and will not permit any of its Restricted
Subsidiary to assign, pledge or otherwise grant a security interest in
their assets in favour of any Indebtedness except for (i) Liens for
taxes, assessments or other government charges not then due and
delinquent or the validity of which is being contested in good faith;
(ii) Liens arising in
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the ordinary course of business and not incurred in connection with the
borrowing of money; (iii) Liens securing Indebtedness of any Restricted
Subsidiary in favour of the Corporation; (iv) Liens existing as of the
Closing Date, provided that such Liens may not be subsequently extended
to any other property of the Corporation or any Restricted Subsidiary;
(v) Liens securing all or any part of the purchase price or to secure
Indebtedness incurred or assumed to pay all or any part of the purchase
price or cost of construction of property (including equipment
manufactured by the Corporation) acquired or constructed by the
Corporation or a Restricted Subsidiary after the Closing Date, subject
to customary provisions including that such Liens be created within 90
days after the purchase or construction of such property or equipment;
(vi) Liens securing Indebtedness ranking equally to the Debentures
provided that upon the granting of such Lien, the Debentures are
secured equally and ratably by such Lien; (vii) Liens renewing or
extending any Lien permitted in (iii) through (vi) above provided the
principal amount of Indebtedness secured by such Lien is not increased
and the Lien is not extended to any other property; and (viii) other
Liens, provided such other Liens do not exceed in the aggregate 5% of
the Corporation's Shareholders' Equity.
4.2.7 Limitation on Merger and Consolidation
The Corporation will not merge or consolidate with any other Person
unless (i) it shall be the surviving corporation or the surviving
corporation shall assume the Corporation's obligations under the
Indenture and (ii) subsequent to such merger or consolidation, the
Corporation shall be in compliance with the terms of the Debentures.
The foregoing shall not limit the ability of the Corporation to merge
or consolidate with its subsidiaries or for subsidiaries to merge or
consolidate with other subsidiaries.
4.2.8 Limitations on Sale of Assets
Other than in the ordinary course of business, the Corporation will
not, and will not permit any of its Restricted Subsidiaries to, dispose
of any assets unless: (i) the Corporation or its Restricted Subsidiary,
as the case may be, receives consideration at the time of such
disposition at least equal to the fair market value thereof (as
determined in good faith by the board of directors and evidenced by a
board resolution) and (ii) the aggregate book value of such assets
disposed during any fiscal year shall not exceed 15% of the
Corporation's consolidated total assets unless the proceeds from the
disposal of such assets are used either to reinvest in a like business
to the Corporation's existing businesses or reduce outstanding
Indebtedness.
4.2.9 Limitation on Preferred Shares of Subsidiaries
The Corporation will not permit any Restricted Subsidiary to issue any
preferred shares (except preferred shares to the Corporation or a
Restricted Subsidiary) or permit any Person (other than the Corporation
or a subsidiary) to hold any such preferred shares unless the
Corporation or such Restricted Subsidiary would be entitled to incur or
assume Indebtedness under the covenant described under "Limitation on
Additional Indebtedness" in the aggregate principal amount equal to the
aggregate liquidation value of the preferred shares to be issued and
the covenant described under "Limitation on Indebtedness of Restricted
Subsidiaries" would be respected.
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4.3 TO PROVIDE ANNUAL AND QUARTERLY CERTIFICATE OF COMPLIANCE
The Corporation covenants that, on or before April 22nd, in each
subsequent year and on or before the end of each quarter and at any
other time if requested by the Trustee, the Corporation will furnish to
the Trustee a Certificate of the Corporation stating that the
Corporation has complied with all covenants, conditions and other
requirements contained in this Indenture, non-compliance with which
would, with the giving of notice or the lapse of time or both,
constitute an Event of Default hereunder or, if such is not the case,
specifying the covenant, condition or other requirement which has not
been complied with and giving particulars of such non-compliance and
the action, if any, the Corporation proposes to take with respect
thereto.
4.4 TO PAY TRUSTEE'S REMUNERATION
The Corporation covenants that it will pay to the Trustee reasonable
remuneration for its services as Trustee and will pay all costs,
charges and expenses (including reasonable fees and disbursements of
its counsel and all other advisors not regularly in its employ)
properly incurred by the Trustee in connection herewith, on demand by
the Trustee, and also (in addition to any right of indemnity given to
the Trustee by law) will at all times keep indemnified the Trustee
against all liabilities, losses, damages, actions, proceedings, costs,
claims, expenses and demands in respect of any matter or thing done or
omitted by the Trustee (other than through negligence of the Trustee)
in any way relating to this Indenture.
Any amount due under this Section 4.4 and unpaid 30 days after demand
for such payment shall bear interest from the expiration of such 30-day
period at a rate per annum equal to the prime rate designated from time
to time by the Royal Bank of Canada as its prime rate for commercial
loans in Canadian funds at Montreal. After default all amounts so
payable and the interest thereon shall be payable out of any funds
coming into possession of the Trustee in priority to any payment of the
principal of and interest on the Debentures.
4.5 TRUSTEE MAY PERFORM COVENANTS
If the Corporation shall fail to perform any of its covenants contained
herein, the Trustee may in its discretion, but (subject to Section 5.2)
need not, notify the Debentureholders of such failure or may itself
perform any of such covenants capable of being performed by it and, if
any such covenant requires the payment of money, it may make such
payment with its own funds, or with money borrowed by it for such
purpose, but shall be under no obligation to do so; and all sums so
paid shall be payable by the Corporation in accordance with the
provisions of Section 4.4. No such performance by the Trustee of any
covenant contained herein or payment by the Corporation of any sums
advanced or borrowed by the Trustee pursuant to the foregoing
provisions shall be deemed to relieve the Corporation from any default
hereunder.
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ARTICLE 5
DEFAULT AND ENFORCEMENT
5.1 EVENTS OF DEFAULT
Each of the following events is hereinafter sometimes referred to as an
"Event of Default":
5.1.1 if the Corporation makes default in payment of the principal
or interest on the Debentures when the same becomes due and
such failure continues for a period of more than five (5)
Business Days;
5.1.2 failure of the Corporation to comply with any of the financial
covenants, and such failure continues for more than thirty
(30) days after notice thereof to the Corporation;
5.1.3 if the Corporation makes default in observing or performing
any other covenant or condition of this Indenture on its part
to be observed or performed and if such default continues for
a period of thirty (30) days after notice in writing has been
given to the Corporation by the Trustee specifying such
default and requiring the Corporation to rectify the same;
5.1.4 inaccuracy of any material representation, warranty,
certificate, or financial statement furnished in connection
with the sale of the Debentures;
5.1.5 the occurrence of one or more events of default under
indentures or instruments evidencing or under which the
Corporation or any Restricted Subsidiary has outstanding any
Indebtedness in excess of $5,000,000 in the aggregate which
causes any trustee or holder of such Indebtedness to
accelerate the maturity thereof; and
5.1.6 insolvency of the Corporation or any Restricted Subsidiary,
the appointment of a receiver for the major part of the
property of the Corporation or any Restricted Subsidiary, the
existence of a final judgment against the Corporation or any
Restricted Subsidiary, from which all appeals are exhausted in
excess of 5% of Total Consolidated Assets, which has remained
unpaid or unstayed for 30 days, and bankruptcy proceedings of
the Corporation or any Restricted Subsidiary which are
consented to or not dismissed within 60 days.
5.2 NOTICE OF EVENTS OF DEFAULT
If an Event of Default shall occur and is continuing the Trustee shall,
within 15 days after it becomes aware of the occurrence of such Event
of Default, except in the case of Section 5.1.1 hereof, in which case
no notice is required to be given, give notice thereof to the
Debentureholders, provided that, notwithstanding the foregoing, the
Trustee shall not be required to give such notice if the Trustee in
good faith shall have decided that the withholding of such notice is in
the best interests of the Debentureholders and shall have so advised
the Corporation in writing.
Where notice of the occurrence of an Event of Default has been given
and the Event of Default is thereafter cured, notice that the Event of
Default is no longer continuing shall be given by the
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Trustee to the Debentureholders within 5 days after the Trustee becomes
aware that the Event of Default has been cured.
5.3 ACCELERATION ON DEFAULT
If an Event of Default under 5.1.1 above occurs and is continuing, then
any holder of Debentures may declare the Debentures to be due and
payable immediately. Upon the occurrence of any of the Events of
Default listed in paragraphs 5.1.2 through 5.1.5 and upon written
request of holders of at least 35% of the aggregate principal amount of
Debentures then outstanding, the Debentures shall be immediately due
and payable. Upon the occurrence of an Event of Default under paragraph
5.1.6, then the Debentures shall be immediately due and payable. In
each case, the Trustee will give notice of acceleration of payment to
all Holders and the Debentureholders shall be entitled to receive
payment of an amount equal to the Redemption Price that would otherwise
have been payable on the Debentures on such date had it been on a
Redemption Date.
5.4 WAIVER OF DEFAULT
Notwithstanding paragraph 5.3, any such acceleration for any Event of
Default listed in paragraphs 5.1.2 through 5.1.5 may be annulled upon
the written request of the holders of at least 67% of the aggregate
principal amount of Debentures then outstanding when the Debentures are
declared due and payable.
If an Event of Default shall have occurred, the Trustee, so long as it
has not become bound to institute any proceedings hereunder, shall have
the power to waive any Event of Default hereunder, if, in the Trustee's
opinion, the same shall have been cured or adequate satisfaction made
therefor, and in such event to cancel any such declaration theretofore
made by the Trustee in the exercise of its discretion, upon such terms
and conditions as the Trustee may consider advisable, provided that no
delay or omission of the Trustee or of the Debentureholders to exercise
any right or power accruing upon any Event of Default shall impair any
such right or power or shall be construed to be a waiver of any such
Event of Default or acquiescence therein and provided further that no
act or omission either of the Trustee or of the Debentureholders shall
extend to or be taken in any manner whatsoever to affect any subsequent
Event of Default hereunder or the rights resulting therefrom.
5.5 ENFORCEMENT BY THE TRUSTEE
If an Event of Default shall have occurred, but subject to applicable
law, Section 5.4 and to the provisions of any Extraordinary Resolution
that may be passed by the Debentureholders hereinafter provided:
5.5.1 the Trustee may in its discretion proceed to enforce the
rights of the Trustee and of the Debentureholders by any
action, suit, remedy or proceeding authorized or permitted by
this Indenture or by law or equity; and may file such proofs
of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and of
the Debentureholders filed in any bankruptcy, insolvency,
winding-up or other judicial proceedings relating to the
Corporation;
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5.5.2 no such remedy for the enforcement of the rights of the
Trustee or the Debentureholders shall be exclusive of or
dependent on any other such remedy but any one or more of such
remedies may from time to time be exercised independently or
in combination;
5.5.3 all rights of action hereunder may be enforced by the Trustee
without the possession of any of the Debentures or the
production thereof at the trial or other proceedings relating
thereto; and
5.5.4 upon receipt of a Debentureholders' Request and upon receiving
sufficient funds and being indemnified to its satisfaction as
provided in Subsection 10.3.2. the Trustee shall exercise or
take one or more of such remedies as the Debentureholders'
Request may direct, provided that if any such
Debentureholders' Request directs the Trustee to take
proceedings out of court the Trustee may in its discretion
take judicial proceedings in lieu thereof.
5.6 DEBENTUREHOLDERS MAY NOT XXX
No Holder of any Debenture shall have the right to institute any
actions suit or proceeding or to exercise any other remedy authorized
or permitted by this Indenture or by law or by equity for the purpose
of enforcing payment of principal or interest owing on any Debenture or
for the execution of any trust or power hereunder, unless:
5.6.1 such Holder shall previously have given to the Trustee written
notice of the occurrence of an Event of Default;
5.6.2 the Debentureholders, by Debentureholders' Request shall have
made a request to the Trustee to take action hereunder or the
written request referred to in Subsection 5.5.4 shall have
been delivered to the Trustee, and the Trustee shall have been
offered a reasonable opportunity either itself to proceed to
exercise the powers hereinbefore granted or to institute an
action, suit or proceeding in its name for such purpose;
5.6.3 the Debentureholders or any of them shall have furnished to
the Trustee, when requested by the Trustee, sufficient funds
and an indemnity in accordance with Subsection 10.3.2; and
5.6.4 the Trustee shall have failed to act within thirty (30) days
thereafter.
In such event but not otherwise, any Debentureholder, acting on behalf
of himself and all other Debentureholders, shall be entitled to take
proceedings in any court of competent jurisdiction such as the Trustee
might have taken under Section 5.5, but in no event shall any
Debentureholder or combination of Debentureholders have any right to
take any other remedy or proceedings; it being understood and intended
that no one or more Holders of Debentures shall have any right in any
manner whatsoever to enforce any right hereunder or under any Debenture
except subject to the conditions and in the manner herein provided, and
that all powers and trusts hereunder shall be exercised and all
proceedings at law shall be instituted, had and maintained by the
Trustee, except only as herein provided, and in any event for the equal
benefit of all Holders of outstanding Debentures.
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5.7 APPLICATION OF MONEYS
Except as otherwise provided herein, any moneys arising from any
enforcement hereof, whether by the Trustee or any Holder of a
Debenture, shall be held in trust by the Trustee and applied by it.
together with any moneys then or thereafter in the hands of the Trustee
available for the purpose, as follows:
5.7.1 first, in payment or reimbursement to the Trustee of the
remuneration, expenses, disbursements and advances of the
Trustee earned, incurred of made in the administration or
execution of the trusts and powers hereunder or otherwise in
relation to this Indenture with interest thereon as herein
provided;
5.7.2 second, in or towards payment of the principal of all of the
Debentures then outstanding and thereafter in or towards
payment of the accrued and unpaid interest and interest on
overdue interest on such Debentures (or if the
Debentureholders, by instrument signed by the Holders of more
than 50% of the principal amount of the Debentures then
outstanding or by Extraordinary Resolution passed at a meeting
of Debentureholders. shall have directed payments to be made
in accordance with any other order of priority, or without
priority as between principal and interest, then such moneys
shall be applied in accordance with such direction); and
5.7.3 third, the surplus (if any) of such moneys shall be paid to
the Corporation or as it may direct;
provided, however, that no payments shall be made in respect of the
principal or interest on any Debenture held by or for the benefit of
the Corporation (other than any Debenture pledged for value and in good
faith to a Person other than the Corporation, but only to the extent of
such Person's interest therein) except subject to the prior payment in
full of the principal of and interest on all Debentures which are not
so held.
5.8 DISTRIBUTION OF MONEYS
Payments to Holders of Debentures pursuant to Subsection 5.7.2 shall be
made as follows:
5.8.1 at least 10 days' notice of every such payment shall be given
in the manner provided in Article 9 specifying the date and
time when and the place or places where such payments are to
be made and the amount of the payment and the application
thereof as between principal and interest;
5.8.2 payment of any Debenture shall be made upon presentation
thereof at any one of the places specified in such notice and
any such Debenture thereby paid in full shall be surrendered,
otherwise a notation of such payment shall be endorsed
thereon; but the Trustee may in its discretion dispense with
presentation and surrender or endorsement in any special case
upon receipt by it of such indemnity as it shall consider
sufficient;
5.8.3 from and after the date of payment specified in the notice,
interest shall accrue only on the amount owing on each
Debenture after giving credit for the amount of the payment
specified in such notice unless the Debenture in respect of
which such amount is owing
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is duly presented on or after the date so specified and
payment of such amount is not made; and
5.8.4 the Trustee shall not be required to make any partial or
interim payment to Debentureholders unless the moneys in its
hands, after reserving therefrom such amount as the Trustee
may think necessary to provide for the payments mentioned in
Subsection 5.7.1, exceed 5% of the aggregate principal amount
of the outstanding Debentures, but it may retain the moneys so
received by it and deal with the same as provided in Section
10.14 until the money or investments representing the same,
with the income derived therefrom, together with any other
moneys for the time being under its control shall be
sufficient for such purpose or until it shall consider it
advisable to apply the same in the manner hereinbefore set
forth.
5.9 PERSONS DEALING WITH TRUSTEE
No Person dealing with the Trustee or any of its agents shall be
concerned to enquire whether an Event of Default has occurred, or
whether the powers which the Trustee is purporting to exercise have
become exercisable, or whether any moneys remain due under this
Indenture or on the Debentures, or to see to the application of any
moneys paid to the Trustee; and in the absence of fraud on the part of
such Person, such dealing shall be deemed to be within the powers
hereby conferred and to be valid and effective accordingly.
5.10 TRUSTEE APPOINTED ATTORNEY
The Corporation irrevocably appoints the Trustee to be the attorney of
the Corporation in the name and on behalf of the Corporation to execute
any instruments and do any things which the Corporation ought to
execute and do, and has not executed or done, under the covenants and
provisions contained in this Indenture and generally to use the name of
the Corporation in the exercise of all or any of the powers hereby
conferred on the Trustee with full powers of substitution and
revocation.
5.11 REMEDIES CUMULATIVE
No remedy herein conferred upon or reserved to the Trustee or the
Holders of Debentures is intended to be exclusive of any other remedy,
but each and every such remedy shall be cumulative and shall be in
addition to every other remedy given hereunder or now or hereafter
existing by law or by statute.
5.12 JUDGEMENT AGAINST THE CORPORATION
In the case of any judicial or other proceedings to obtain judgment for
the principal of or interest on the Debentures, judgment may be
rendered against the Corporation in favour of the Debentureholders or
in favour of the Trustee, as Trustee for the Debentureholders, for any
amount which may remain due in respect of the Debentures.
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ARTICLE 6
SATISFACTION AND DISCHARGE
6.1 CANCELLATION AND DESTRUCTION
All matured Debentures shall forthwith after payment thereof be
delivered to the Trustee and cancelled by it. Subject to trust industry
practice, all Debentures which are cancelled or required to be
cancelled under this or any other provision of this Indenture shall be
destroyed by the Trustee and, if required by the Corporation, the
Trustee shall furnish to it a destruction certificate setting out the
designating numbers and denominations of the Debentures so destroyed.
6.2 NON-PRESENTATION OF DEBENTURES
If the Holder of any Debenture shall fail to present the same for
payment on the date on which the principal thereof and/or the interest
thereon or represented thereby becomes payable either at maturity or on
redemption or otherwise or shall not accept payment on account thereof
and give such receipt therefor (if any) as the Trustee may require:
6.2.1 the Corporation shall be entitled to pay to the Trustee and
direct it to set aside; or
6.2.2 in respect of moneys in the hands of the Trustee which may or
should be applied to the payment of the Debentures, the
Corporation shall be entitled to direct the Trustee to set
aside; or
6.2.3 if the redemption was pursuant to notice given by the Trustee,
the Trustee may itself set aside;
the principal moneys and/or the interest, as the case may be, in trust
to be paid to the Holder of such Debenture upon due presentation and
surrender thereof in accordance with the provisions of this Indenture;
and thereupon the principal moneys and/or the interest payable on or
represented by each Debenture in respect whereof such moneys have been
set aside shall be deemed to have been paid and thereafter such
Debentures shall not be considered as outstanding hereunder and the
Holders thereof shall thereafter have no right in respect thereof
except that of receiving payment of the moneys so set aside by the
Trustee (without interest thereon) upon due presentation and surrender
thereof, subject always to the provisions of Section 6.3.
6.3 REPAYMENT OF UNCLAIMED MONEYS
Subject to any applicable law with respect to the deposit of unclaimed
moneys with any public authority and to any applicable law of
prescription or statute of limitation, any moneys set aside under
Section 6.2 and not claimed by and paid to Holders of Debentures as
provided in Section 6.2 within three years after the date of such
setting aside shall be repaid to the Corporation by the Trustee on
demand and thereupon the Trustee shall be released from all further
liability with respect to such moneys and thereafter the Holders of the
Debentures in respect of which such moneys were so repaid to the
Corporation shall have no rights in respect thereof except to obtain
payment of the moneys due thereon from the Corporation.
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6.4 DISCHARGE
Upon proof being given to the reasonable satisfaction of the Trustee
that all the Debentures and interest (including interest on amounts in
default) thereon have been paid or satisfied or that, all the
outstanding Debentures having matured or having been duly called for
redemption or the Trustee having been given irrevocable instructions by
the Corporation to give within 60 days notice of redemption of all the
outstanding Debentures, such payment or redemption has been duly
provided for by payment to the Trustee or otherwise, and upon payment
of all costs, charges and expenses properly incurred by the Trustee in
relation to this Indenture and all interest thereon and the
remuneration of the Trustee, or upon provision satisfactory to the
Trustee being made therefor, the Trustee shall, at the request and at
the expense of the Corporation, execute and deliver to the Corporation
such deeds or other instruments as shall be necessary to evidence the
satisfaction and discharge of this Indenture and to release the
Corporation from its covenants contained herein except those relating
to the indemnification of the Trustee.
ARTICLE 7
SUCCESSOR CORPORATION
7.1 CERTAIN REQUIREMENTS IN RESPECT OF MERGER, ETC.
The Corporation shall not enter into any transaction, whether by way of
amalgamation (except a short-form amalgamation with one or more of its
wholly-owned subsidiaries pursuant to the Canada Business Corporations
Act), merger, arrangement, reconstruction, reorganization,
consolidation, transfer, sale, lease or otherwise whereby all or
substantially all of its undertaking, property and assets would become
the property of any other Person or of any continuing corporation
resulting therefrom, unless, but may do so if:
7.1.1 such other Person or continuing corporation is a corporation
(the "Successor Corporation") incorporated under the laws of
Canada or any province thereof;
7.1.2 the Successor Corporation shall perform such acts and execute,
prior to or contemporaneously with the completion of such
transaction, such indenture supplemental hereto and other
instruments (if any) as in the opinion of Counsel are
necessary or advisable to evidence the assumption by the
Successor Corporation of the liability for the due and
punctual payment of all the Debentures and the interest
thereon and all other moneys payable hereunder and the
covenant of such Successor Corporation to pay the same and its
agreement to observe and perform all the covenants and
obligations of the Corporation under this Indenture;
7.1.3 the Debentures will be valid and binding obligations of the
Successor Corporation entitling the Holders, as against the
Successor Corporation, to all of the rights they have under
this Indenture;
7.1.4 no condition or event shall exist in respect of the
Corporation or the Successor Corporation, either at the time
of such transaction or immediately thereafter after giving
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full effect thereto, which constitutes or would, after the
giving of notice or the lapse of time or both, constitute an
Event of Default hereunder; and
7.1.5 the Corporation shall have delivered to the Trustee a
Certificate of the Corporation and an opinion of Counsel each
stating that such amalgamation, merger, arrangement,
reconstruction, reorganization, consolidation, transfer, sale,
lease or other transaction and such supplemental indenture, if
any, comply with this Article and that all conditions
precedent herein provided for relating to such transaction
have been complied with.
7.2 VESTING OF POWERS IN SUCCESSOR
Whenever the conditions of Section 7.1 have been duly observed and
performed, the Trustee shall execute and deliver the supplemental
indenture provided for in Article 11 and thereupon:
7.2.1 the Successor Corporation shall possess and from time to time
may exercise each and every right and power of the Corporation
under this Indenture in the name of the Corporation or
otherwise, and any act or proceeding by any provision of this
Indenture required to be done or performed by any directors or
officers of the Corporation may be done and performed with
like force and effect by the like directors or officers of
such Successor Corporation; and
7.2.2 the Corporation shall be released and discharged from
liability under this Indenture and the Trustee may execute any
documents which it may be advised are necessary or advisable
for effecting or evidencing such release and discharge.
ARTICLE 8
MEETINGS OF DEBENTUREHOLDERS
8.1 RIGHT TO CONVENE MEETINGS
The Trustee may at any time and from time to time and shall, upon
receipt of a written request of the Corporation or a Debentureholders'
Request and of sufficient funds and upon being indemnified to its
reasonable satisfaction by the Corporation or by the Debentureholders
signing such written request against the costs which may be incurred in
connection with the calling and holding of such meeting, convene a
meeting of the Debentureholders. If the Trustee fails within 30 days
after receipt of any such written request or Debentureholders' Request
and such indemnity to give notice convening a meeting, the Corporation
or such Debentureholders, as the case may be, may convene such meeting.
Every such meeting shall be held in the City of Montreal or at such
other place as may be approved or determined by the Trustee.
8.2 NOTICE OF MEETINGS
Subject to Section 8.12, not more than 60 and not less than 30 days'
notice of any meeting shall be given to the Debentureholders and a copy
thereof shall be sent by mail to the Trustee and to the Corporation
unless the meeting has been called by it. Such notice shall state the
time when and the place where the meeting is to be held and shall state
briefly the general nature of the business to be
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transacted thereat, but it shall not be necessary for any such notice
to set out the terms of any resolution to be proposed at the meeting or
any of the provisions of this Article 8 but must specify in general
terms the action proposed to be taken at such meeting.
8.3 CHAIRMAN
An individual, who need not be a Debentureholder, nominated in writing
by the Trustee shall be chairman of the meeting and if no individual is
so nominated or if the individual so nominated is unable or unwilling
to act or if the individual so nominated is not present within 15
minutes from the time fixed for the holding of the meeting, the
Debentureholders present in person or by proxy shall choose an
individual present to be chairman.
8.4 QUORUM
At any meeting of the Debentureholders other than a meeting convened
for the purpose of considering a resolution proposed to be passed as an
Extraordinary Resolution, as to which the provisions of Section 8.12
shall be applicable, a quorum shall consist of Debentureholders present
in person or by proxy and representing at least 25% in principal amount
of the outstanding Debentures. If a quorum of the Debentureholders
shall not be present within thirty (30) minutes from the time fixed for
holding any such meeting, the meeting, if convened by the
Debentureholders or pursuant to a Debentureholders' Request, shall be
dissolved; but in any other case the meeting shall be adjourned to the
same day in the next week (unless such day is not a Business Day, in
which case it shall be adjourned to the next following Business Day) at
the same time and place. At the adjourned meeting the Debentureholders
present in person or by proxy shall form a quorum and may transact the
business for which the meeting was originally convened notwithstanding
that they may not represent 25% of the principal amount of the
outstanding Debentures.
8.5 POWER TO ADJOURN
The chairman of any meeting at which a quorum of the Debentureholders
is present may, with the consent of the Holders of at least fifty
percent (50%) of the principal amount of the Debentures represented
thereat, adjourn any such meeting and no notice of such adjournment
need be given except such notice, if any, as the meeting may prescribe.
8.6 SHOW OF HANDS
Every question submitted to a meeting shall be decided in the first
place by a majority of the votes given on a show of hands except that
votes on Extraordinary Resolutions shall be given in the manner
hereinafter provided. At such meeting unless a poll is duly demanded as
herein provided, a declaration by the chairman that a resolution has
been carried or carried unanimously or by a particular majority or lost
or not carried by a particular majority shall be conclusive evidence of
the fact.
8.7 POLL
On every Extraordinary Resolution, and on any other question submitted
to a meeting, when demanded by the chairman or by one or more
Debentureholders and/or proxies for Debentureholders holding at least
5% of the principal amount of the Debentures represented thereat, a
poll shall be
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taken in such manner as the chairman shall direct. Questions other than
Extraordinary Resolutions shall, if a poll is taken, be decided by the
votes of the Holders of a majority in principal amount of the
Debentures represented at the meeting and voted on the poll.
8.8 VOTING
On a show of hands, every Person who is present and entitled to vote,
whether as a Debentureholder or as proxy, shall have one vote. On a
poll each Debentureholder present in person or represented by a duly
appointed proxy shall be entitled to one vote in respect of each $1,000
principal amount of Debentures of which he shall then be the Holder. A
proxy need not be a Debentureholder. In the case of joint registered
Holders of a Debenture, any one of them present in person or by proxy
at the meeting may vote in the absence of the other or others; but in
case more than one of them are present in person or by proxy, they
shall vote together in respect of the Debentures of which they are
joint registered Holders.
8.9 REGULATIONS
The Trustee or the Corporation, with the approval of the Trustee, may
from time to time make and from time to time vary such regulations as
it shall from time to time think fit providing for:
8.9.1 voting by proxy and the form of the instrument appointing a
proxy (which shall be in writing) and the manner in which the
same shall be executed and for the production of the authority
of any Person signing on behalf of a Debentureholder;
8.9.2 the deposit of instruments appointing proxies at such place as
the Trustee, the Corporation or the Debentureholders convening
a particular meeting, as the case may be, may in the notice
convening the meeting direct and the time, if any, before the
holding of the meeting or any adjournment thereof by which the
same shall be deposited; and
8.9.3 the deposit of instruments appointing proxies at some approved
place or places other than the place at which a particular
meeting is to be held and enabling particulars of instruments
appointing proxies to be mailed, cabled, telegraphed,
telecopied or sent by telex before the meeting to the
Corporation or to the Trustee at the place where the same is
to be held and for the voting of proxies so deposited as
though the instruments themselves were produced at the
meeting.
Any regulations so made shall be binding and effective and the votes
given in accordance therewith shall be valid and shall be counted. Save
as such regulations may provide, the only Persons who shall be
recognized at any meeting as the Holders of any Debentures, or as
entitled to vote or be present at the meeting in respect thereof, shall
be Debentureholders and persons whom Debentureholders have duly
appointed as their proxies.
8.10 CORPORATION AND TRUSTEE MAY BE REPRESENTED
The Corporation and the Trustee, by their respective officers and
directors, and the legal advisers of the Corporation and the Trustee
may attend any meeting of the Debentureholders, but shall have no vote
as such.
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8.11 POWERS EXERCISABLE BY EXTRAORDINARY RESOLUTION
In addition to the powers conferred upon them by any other provisions
of this Indenture or by law, a meeting of the Debentureholders shall
have the following powers exercisable from time to time by
Extraordinary Resolution:
8.11.1 power to approve any change whatsoever in any of the
provisions or this Indenture or the Debentures and any
modification, abrogation, alteration, compromise or
arrangement of the rights of the Debentureholders and/or the
Trustee against the Corporation or against its undertaking,
property and assets or any part thereof, whether such rights
arise under this Indenture or the Debentures or otherwise;
8.11.2 power to approve any scheme for the reconstruction or
reorganization of the Corporation or for the consolidation,
amalgamation or merger of the Corporation with any other
corporation or for the selling or leasing of the undertaking,
property and assets of the Corporation or any part thereof,
provided that no such approval shall be necessary in respect
of any such transaction if the provisions of Article 7 shall
have been complied with;
8.11.3 power to direct or authorize the Trustee to exercise any
power, right, remedy or authority given to it by this
Indenture or the Debentures in any manner specified in such
Extraordinary Resolution or to refrain from exercising any
such power, right, remedy or authority;
8.11.4 power to waive and direct the Trustee to waive any default or
Event of Default hereunder and/or cancel any declaration made
by the Trustee pursuant to Section 5.3 either unconditionally
or upon any conditions specified in such Extraordinary
Resolution;
8.11.5 power to restrain any Debentureholder from taking or
instituting any suit, action or proceeding for the purpose of
enforcing payment of the principal or interest of any
Debenture, or for the execution of any trust or power
hereunder;
8.11.6 power to direct any Debentureholder who, as such, has brought
any action, suit or proceeding to stay or discontinue or
otherwise deal with the same in the manner directed by such
Extraordinary Resolution upon payment, in the taking of such
action, suit or proceeding shall have been permitted by
Section 5.6, of the costs, charges and expenses reasonably and
properly incurred by such Debentureholder in connection
therewith;
8.11.7 power to appoint a committee to consult with the Trustee (and
to remove any committee so appointed) and to delegate to such
committee (subject to such limitations, if any, as may be
prescribed in such Extraordinary Resolution) all or any of the
powers which the Debentureholders may exercise by
Extraordinary Resolution under this Section 8.11; the
Extraordinary Resolution making such appointment may provide
for payment of the expenses and disbursements of and
compensation to such committee; such committee shall consist
of such number of individuals (who need not be
Debentureholders) as shall be prescribed in the Extraordinary
Resolution appointing it; subject to the Extraordinary
Resolution appointing it, every such committee may elect its
chairman and may make regulations respecting its quorum, the
calling of its meetings, the filling of vacancies
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occurring in its number, the manner in which it may act and
its procedure generally and such regulations may provide that
the committee may act at a meeting at which a quorum is
present or may act by resolution signed in one or more
counterparts by a majority of the members thereof or the
number of members thereof necessary to constitute a quorum,
whichever is the greater; all acts of any such committee
within the authority delegated to it shall be binding upon all
Debentureholders;
8.11.8 power to agree to any compromise or arrangement with any
creditor or creditors or any class or classes of creditors,
whether secured or otherwise, and with holders of any shares
or other securities of the Corporation;
8.11.9 power to authorize the distribution in specie of any shares,
[bonds], debentures or other securities or obligations and/or
cash or other consideration received or the use or disposition
of the whole or any part of such shares, [bonds], debentures
or other securities or obligations and/or cash or other
consideration in such manner and for such purpose as may be
considered advisable and specified in such Extraordinary
Resolution;
8.11.10 power to approve the exchange of the Debentures for or the
[conversion] thereof into shares, [bonds], debentures or other
securities or obligations of the Corporation or of any company
formed or to be formed;
8.11.11 power to remove the Trustee from office and to appoint a new
Trustee or Trustees; and
8.11.12 power to amend, alter or repeal any Extraordinary Resolution
previously passed or approved by the Debentureholders or by
any committee appointed pursuant to Subsection 8.11.7.
8.12 MEANING OF "EXTRAORDINARY RESOLUTION"
8.12.1 The expression "Extraordinary Resolution" when used in this
Indenture means, subject as hereinafter provided in this
Article 8, a resolution proposed to be passed as an
Extraordinary Resolution at a meeting of Debentureholders duly
convened for the purpose and held in accordance with the
provisions of this Article 8 at which the Holders of more than
50% of the principal amount of the Debentures then outstanding
are present in person or by proxy and passed by the favourable
votes of the Holders of not less than 66 2/3% of the principal
amount of Debentures represented at the meeting and voted on a
poll upon such resolution;
8.12.2 if at any such meeting the holders of more than 50% of the
principal amount of the Debentures then outstanding are not
present in person or by proxy within 30 minutes after the time
appointed for the meeting, then the meeting, if convened by
the Debentureholders or pursuant to a Debentureholders'
Request, shall be dissolved; but in any other case it shall be
adjourned to such date, being not less than 21 nor more than
60 days later, and to such place and time as may be appointed
by the chairman. Not less than 10 days' notice shall be given
of the time and place of such adjourned meeting in the manner
provided in Article 9. Such notice shall state that at the
adjourned meeting the Debentureholders present in person or by
proxy shall form a quorum, but it shall not be necessary to
set forth the purposes for which the meeting was originally
called or any other particulars. At
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the adjourned meeting the Debentureholders present in person
or by proxy shall form a quorum and may transact the business
for which the meeting was originally convened and a resolution
proposed at such adjourned meeting and passed in accordance
with Subsection 8.12.1 shall be an Extraordinary Resolution
within the meaning of this Indenture, notwithstanding that the
Holders of more than 50% of the principal amount of the
Debentures then outstanding are not present in person or by
proxy at such adjourned meeting;
8.12.3 votes on an Extraordinary Resolution shall always be given on
a poll and no demand for a poll on an Extraordinary Resolution
shall be necessary.
8.13 POWERS CUMULATIVE
It is hereby declared and agreed that any one or more of the powers
and/or any combination of the powers in this Indenture stated to be
exercisable by the Debentureholders by Extraordinary Resolution or
otherwise may be exercised from time to time and the exercise of any
one or more of such powers or any combination of powers from time to
time shall not be deemed to exhaust the right of the Debentureholders
to exercise the same or any other such power or powers or combination
of powers thereafter from time to time.
8.14 MINUTES
Minutes of all resolutions and proceedings at every meeting of
Debentureholders shall be made and duly entered in books to be provided
for that purpose by the Trustee at the expense of the Corporation, and
any such minutes, if signed by the chairman of the meeting at which
such resolutions were passed or proceedings had, or by the chairman of
the next succeeding meeting of the Debentureholders, shall be prima
facie evidence of the matters therein stated and, until the contrary is
proved, every such meeting, in respect of the proceedings of which
minutes shall have been made, shall be deemed to have been duly held
and convened, and all resolutions passed or proceedings had thereat, to
have been duly passed and had.
8.15 SIGNED INSTRUMENTS
Any action which may be taken and any power which may be exercised by
the Debentureholders at a meeting held as hereinbefore in this Article
provided may also be taken and exercised by the Holders of more than 66
2/3% of the principal amount of the outstanding Debentures by a signed
instrument and the expression "Extraordinary Resolution" when used in
this Indenture shall include an instrument so signed. Notice of any
Extraordinary Resolution passed in accordance with this Section 8.15
shall be given by the Trustee to the Holders of Debentures affected
thereby within 30 days of the date on which such Extraordinary
Resolution was passed.
8.16 BINDING EFFECT OF RESOLUTIONS
Every resolution and every Extraordinary Resolution passed in
accordance with the provisions of this Article 8 at a meeting of
Debentureholders shall be binding upon all the Debentureholders,
whether present at or absent from such meeting, and every instrument
signed by Debentureholders in accordance with Section 8.15 shall be
binding upon all the Debentureholders, whether signatories thereto or
not, and each and every Debentureholder and the Trustee (subject to the
provisions for its
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indemnity herein contained) shall be bound to give effect to every such
resolution. Extraordinary Resolution and instrument.
8.17 EVIDENCE OF RIGHTS OF DEBENTUREHOLDERS
Any request, direction, notice, consent or other instrument which this
Indenture may require or permit to be signed or executed by the
Debentureholders may be in any number of concurrent instruments of
similar tenor and may be signed or executed by such Debentureholders in
person or by attorney duly appointed in writing. Proof of the execution
of any such request, direction, notice, consent or other instrument or
of a writing appointing any such attorney shall be sufficient for any
purpose of this Indenture if made in the following manner, namely, the
fact and date of the execution by any Person of such request,
direction, notice, consent or other instrument or writing may be proved
by the certificate of any commissioner for oaths, or other officer
authorized to take acknowledgments of deeds to be recorded at the place
where such certificate is made, that the Person signing such request,
direction, notice, consent or other instrument or writing acknowledged
to him the execution thereof, or by an affidavit of a witness of such
execution or in any other manner which the Trustee may consider
adequate.
The Trustee may, nevertheless, in its discretion require further proof
in cases where it considers further proof necessary or desirable or may
accept such other proof as it shall consider proper.
ARTICLE 9
NOTICES
9.1 NOTICE TO THE CORPORATION
Any notice to the Corporation under the provisions of this Indenture
shall be valid and effective if delivered personally to, or, subject to
Section 9.4, if given by registered mail, postage prepaid, or fax
((000) 000-0000) addressed to the Corporation at 0000 Xxxxx-Xxxxxx
Xxxxxxx, Xx. Xxxxxxx, Xxxxxx, X0X 0X0, Attention: President and Chief
Executive Officer and shall be deemed to have been given on the date of
delivery or on the third Business Day after such letter has been
mailed, as the case may be. The Corporation may from time to time
notify the Trustee of a change of address which thereafter, until
changed by further notice, shall be the address of the Corporation for
all purposes of this Indenture.
9.2 NOTICE TO DEBENTUREHOLDERS
Except as otherwise expressly provided herein, all notices to be given
hereunder with respect to the Debentures shall be valid and effective
if such notice is delivered personally or, subject to Section 9.4, sent
by first-class mail, postage prepaid, addressed to the Holders at their
post office addresses appearing in any of the registers hereinbefore
mentioned. Any notice so delivered or sent by mail shall be deemed to
have been given the day upon which it is delivered or mailed, as the
case may be. Any accidental error, omission or failure in giving or
delivering or mailing any such notice or the non-receipt of any such
notice by any Debentureholder or Holders shall not invalidate or
otherwise prejudicially affect any action or proceeding founded
thereon.
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9.3 NOTICE TO THE TRUSTEE
Any notice to the Trustee under the provisions of this Indenture shall
be valid and affective if delivered personally to, or subject to
Section 9.4, if given by registered mail, postage prepaid, or fax
[(000) 000-0000] addressed to the Trustee at Montreal Trust Company,
Manager, Corporate Trust Services, 0000 XxXxxx Xxxxxxx Xxxxxx, 0xx
Xxxxx, Xxxxxxxx, Xxxxxx, X0X 0X0, and shall be deemed to have been
given on the date of delivery or on the third Business Day after such
letter has been mailed, as the case may be. The Trustee may from time
to time notify the Corporation of a change of address which thereafter,
until changed by further notice, shall be the address of the Trustee
for all purposes of this Indenture.
9.4 MAIL SERVICE INTERRUPTION
If the Trustee determined that mail service is or is threatened to be
interrupted at the time when the Trustee is required or elects to give
any notice to the Debentureholders hereunder, the Trustee shall,
notwithstanding the provisions hereof, give such notice at the
Corporation's expense by means of publication in The Globe and Mail,
national edition, or any other English language daily newspaper or
newspapers of general circulation in Canada and in La Presse or in any
other French language daily newspaper of general circulation in the
Province of Quebec, once in each of two successive weeks, and any
notice so published shall be deemed to have been given on the first
date on which the publication takes place.
If, by reason of any actual or threatened interruption of mail service
due to strike, lock-out or otherwise, any notice to be given to the
Trustee or to the Corporation would be unlikely to reach its
destination in a timely manner, such notice shall be valid and
effective only if delivered personally in accordance with Sections 9.1
or 9.3, as the case may be.
ARTICLE 10
CONCERNING THE TRUSTEE
10.1 TRUST INDENTURE LEGISLATION
10.1.1 In this Article 10, the term "Indenture Legislation" means the
provisions, if any, of the Canada Business Corporations Act
and any other statute of Canada or a province thereof, and of
the regulations under any such statute, relating to trust
indentures and to the rights, duties and obligations of
trustees under trust indentures and of corporations issuing
debt obligations under trust indentures, to the extent that
such provisions are at the time in force and applicable to
this Indenture or the Corporation;
10.1.2 if and to the extent that any provision of this Indenture
limits, qualifies or conflicts with a mandatory requirement of
the Indenture Legislation, such mandatory requirement shall
prevail;
10.1.3 at all times in relation to this Indenture and any action to
be taken hereunder, the Corporation and the Trustee each shall
observe and comply with the Indenture Legislation
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and the Corporation, the Trustee and each Debentureholder
shall be entitled to the benefits of the Indenture
Legislation.
10.2 NO CONFLICT OF INTEREST
The Trustee represents to the Corporation that at the date of the
execution and delivery of this Indenture there exists no material
conflict of interest in the role of the Trustee as a fonde de pouvoir
hereunder. If at any time a material conflict of interest exists in the
Trustee's role as a fonde de pouvoir hereunder the Trustee shall,
within 90 days after ascertaining that such a material conflict of
interest exists, either eliminate the same or else resign as Trustee
hereunder by giving notice in writing to the Corporation at least 21
days prior to such resignation and shall thereupon be discharged from
all further duties and liabilities hereunder.
10.3 RIGHTS AND DUTIES OF TRUSTEE
10.3.1 In the exercise of the rights and duties prescribed or
conferred by the terms of this Indenture, the Trustee shall
act honestly and in good faith with a view to the best
interests of the Holders of the Debentures and shall act with
prudence and diligence;
10.3.2 subject only to Subsection 10.3.1, the obligation of the
Trustee to commence or continue any act, action or proceeding
for the purpose of enforcing any rights of the Trustee or the
Debentureholders hereunder shall be conditional upon the
Debentureholders furnishing, when required by notice in
writing by the Trustee, sufficient funds to commence or
continue such act, action or proceeding and indemnity
reasonably satisfactory to the Trustee to protect and hold
harmless the Trustee against the costs, charges and expenses
and liabilities to be incurred thereby and any loss and damage
it may suffer by reason thereof. None of the provisions
contained in this Indenture shall require the Trustee to
expend or risk 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 or powers unless indemnified as
aforesaid;
10.3.3 the Trustee may, before commencing or at any time during the
continuance of any such act, action or proceeding, require the
Debentureholders at whose instance it is acting to deposit
with the Trustee the Debentures held by them, for which
Debentures the Trustee shall issue receipts;
10.3.4 every provision of this Indenture that by its terms relieves
the Trustee of liability or entitles it to rely upon any
evidence submitted to it is subject to the provisions of
Indenture Legislation, this Section 10.3 and Section 10.4.
10.4 EVIDENCE, EXPERTS AND ADVISERS
10.4.1 The Corporation shall furnish to the Trustee evidence of
compliance with the conditions precedent provided for in this
Indenture relating to any action or step required or permitted
to be taken by the Corporation or the Trustee under this
Indenture or as a result of any obligation imposed under this
Indenture, including without limitation, the certification and
delivery of Debentures, the satisfaction and discharge of this
Indenture and the taking of any other action to be taken by
the Trustee at the request of or on the
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application of the Corporation, forthwith if and when: (i)
such evidence is required by any other Section of this
Indenture to be furnished by the Trustee in accordance with
the terms of this Article 10 or (ii) the Trustee, in the
exercise of its rights and duties under this Indenture, gives
the Corporation written notice requiring it to furnish such
evidence in relation to any particular section or obligations
specified in such notice.
Such evidence shall consist of:
(i) a Certificate of the Corporation stating that any
such condition precedent has been complied with in
accordance with the terms of this Indenture;
(ii) in the case of a condition precedent for which
compliance with is, by the terms of this Indenture,
made subject to review or examination by a solicitor,
an opinion of Counsel that such condition precedent
has been complied with in accordance with the terms
of this Indenture; and
(iii) in the case of any such condition precedent for which
compliance is subject to review or examination by
auditors or accountants, an opinion or report of the
auditors of the Corporation whom the Trustee for such
purposes hereby approves, that such condition
precedent has been complied with in accordance with
the terms of this Indenture.
10.4.2 Whenever such evidence relates to a matter other than the
certification and delivery of Debentures and the satisfaction
and discharge of this Indenture, and except as otherwise
specifically provided herein, such evidence may consist of a
report or opinion of any solicitor, auditor, accountant,
engineer or appraiser or any other person whose qualifications
give authority to a statement made by him provided that if
such report or opinion is furnished by an Authorized Officer
or employee of the Corporation, it shall be in the form of a
statutory declaration. Such evidence shall be, so far as
appropriate, in accordance with Section 10.4.1.
10.4.3 Each statutory declaration, certificate, opinion or report
with respect to compliance with a condition precedent provided
for in this Indenture shall include: (i) a statement by the
person giving the evidence that he has read, understands and
is familiar with those provisions of this Indenture relating
to the condition precedent in question; (ii) a brief statement
of the nature and scope of the examination or investigation
upon which the statements, declarations, certificates or
opinions contained in such evidence are based; (iii) a
statement that in the belief of the person giving such
evidence, he has made such examination or investigation as is
necessary to enable him to make the statements or give the
opinions contained or expressed therein, and (iv) a statement
whether in the opinion of such person the conditions precedent
in question have been complied with or satisfied.
10.4.4 In relation to this Indenture, the Trustee may act on the
opinion or advice of or information obtained from any
solicitor, auditor, valuator, engineer, surveyor, appraiser or
other expert, whether obtained by the Trustee or by the
Corporation or otherwise, but shall not be bound to act upon
such opinion, advice or information and shall not be
responsible for any loss occasioned by so acting or not
acting, as the case may be, and may employ such assistance as
may be necessary to the proper discharge of its duties and
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may pay proper and reasonable compensation for all such legal
and other advice or assistance as aforesaid. Any such advice
or opinion or information may be sent or obtained by letter or
facsimile transmission and the Trustee shall not be liable for
acting on any advice, opinion or information, purporting to be
conveyed by any such means, although the same shall contain
some error or shall not be authentic.
10.4.5 The Trustee shall not be responsible for any misconduct on the
part of any attorneys, bankers, receivers, lawyers, agents,
officers, servants and other assistants or persons appointed
by it hereunder or be bound to supervise the proceedings of
any such appointee and may pay reasonable remuneration for all
services performed for it in the discharge of the trusts
hereof without taxation of any costs or fees of counsel,
solicitor or attorney and shall be entitled to receive
reasonable remuneration for all services performed by it in
the discharge of the trusts hereof and compensation for all
disbursements, costs, liabilities and expenses made or
incurred by it in the discharge of its duties hereunder, and
in the management of the trusts hereof and all such
remuneration, disbursements, costs, liabilities and expenses,
and all remuneration and expenses incident to the preparation,
execution and recording of this Indenture or of any instrument
ancillary or supplemental hereto and the preparation,
execution and issue of the Debentures, whether done or
incurred at the request of the Trustee or the Corporation,
shall bear interest at a rate not in excess of the rate of
interest borne by the Debentures, from the date of the same
being incurred, expended or becoming due and shall be payable
on demand and together with such interest.
10.5 TRUSTEE NOT ORDINARILY BOUND
Except as provided in Section 8.2 and as otherwise specifically
provided herein, the Trustee shall not, subject to Section 10.3.1 be
bound to give notice to any person of the execution hereof or of the
charge hereof, unless and until the security hereby constituted shall
have become enforceable and the Trustee shall have determined or become
bound to enforce the same, nor shall the Trustee be bound to do,
observe or perform or see to the observance or performance by the
Corporation of any of the obligations herein imposed upon the
Corporation or of the covenants on the part of the Corporation herein
contained, nor in any way to supervise or interfere with the conduct of
the Corporation's business, unless the Trustee shall have been required
to do so by a Debentureholders' Request or by an Extraordinary
Resolution of the Holders passed in accordance with the provisions
contained in Article 8, and then only after it shall have been
indemnified to its satisfaction against all actions, proceedings,
claims and demands to which it may render itself liable and all costs,
charges, damages and expenses which it may incur by so doing.
10.6 ABSOLUTE DISCRETION
The Trustee, except as herein otherwise provided, shall, as regards all
the trusts, powers, authorities and discretions vested in it have
absolute and uncontrolled discretion as to the exercise thereof,
whether in relation to the manner or as to the mode of and time for the
exercise hereof, and, in the absence of fraud, it shall in no way be
responsible for any loss, costs, damages or inconvenience that may
result from the exercise or non-exercise thereof.
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10.7 TRUSTEE NOT RESPONSIBLE FOR APPLICATION OF MONIES
The Trustee shall not be responsible for the monies subscribed by
applicants for or purchasers of the Notes or be bound to see to the
application thereof.
10.8 TRUSTEE NOT BOUND TO ACCOUNT FOR PROFITS
Subject to Sections 10.2 and 10.9, the Trustee may buy, sell, lend upon
and deal in the Debentures, either with the Corporation or otherwise,
and generally contract and enter into financial transactions with the
Corporation or otherwise, without being liable to account for any
profits made thereby.
10.9 TRUSTEE NOT TO BE APPOINTED RECEIVER
The Trustee and any person related to the Trustee shall not be
appointed a receiver or receiver and manager or liquidator of all or
any part of the assets or undertakings of the Corporation.
10.10 TRUSTEE NOT BOUND TO ACT
Except as in this Indenture otherwise specifically provided, the
Trustee shall not be bound to act in accordance with any direction or
request of the Corporation or of the Authorized Officers until a duly
authenticated copy of the instrument or resolution containing such
direction or request shall have been delivered to the Trustee and the
Trustee shall be empowered to act upon any such copy purporting to be
authenticated and believed by the Trustee to be genuine.
10.11 INDEMNITY OF TRUSTEE
In addition to and without limiting any protection of the Trustee
hereunder or otherwise by the Indenture Legislation, the Corporation
hereby indemnifies the Trustee and saves it and its officers,
directors, employees and agents harmless from all liabilities, suits,
damages, costs, expenses and actions which may be brought against or
suffered by it arising out of or connected with the performance by it
of its duties hereunder except to the extent that such liabilities,
suits, damages, costs and actions are attributable to the negligence or
wilful misconduct of the Trustee. Notwithstanding any other provision
hereof, this indemnity shall survive any removal or resignation of the
Trustee, discharge of this Indenture and termination of any trusts
hereunder.
10.12 TRUSTEE NOT REQUIRED TO GIVE SECURITY
The Trustee shall not be required to give any bond or security in
respect of the execution of the trusts and powers of this Indenture or
otherwise in respect of this Indenture.
10.13 PROTECTION OF TRUSTEE
By way of supplement to the provisions of any law for the time being
relating to trustees, it is expressly declared and agreed as follows:
10.13.1 the Trustee shall not be liable for or by reason of any
statements of fact or recitals in this Indenture or in the
Debentures (except the representation contained in Section
10.2 and
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in the certificate of the Trustee on the Debentures) or
required to verify the same, but all such statements or
recitals are and shall be deemed to be made by the
Corporation;
10.13.2 nothing herein contained shall impose any obligation on the
Trustee to see to or to require evidence of the registration
or filing (or renewal thereof) of this Indenture or any
instrument ancillary or supplemental hereto;
10.13.3 the Trustee shall not be bound to give notice to any Person of
the execution hereof: and
10.13.4 the Trustee shall not incur any liability or responsibility
whatever or be in any way responsible for the consequence of
any breach on the part of the Corporation of any of the
covenants herein contained or of any acts of the agents of the
Corporation.
10.14 INVESTMENT OF TRUST MONEYS
Unless otherwise provided in this Indenture, any moneys held by the
Trustee, which may or ought to be invested or which may be on deposit
with the Trustee or which may be in the hands of the Trustee, may be
invested and reinvested in the name or under the control of the Trustee
as directed in writing by the Corporation in any of the debt securities
which are presumed sound under the laws of the Province of Quebec at
the time of investment and maturing not later than one year from such
time. Pending such investment such moneys may be placed by the Trustee
on deposit in a chartered bank in Canada or with its own deposit
department. The Trustee shall allow interest at the current rate for
similar deposits on moneys remaining on deposit with it and, provided
that the Corporation is not in default hereunder, shall credit the
Corporation with interest received on moneys deposited with other
depositaries and on all moneys invested as provided in this Section
10.14.
The Trustee shall be accountable only for reasonable diligence in the
investment of moneys under this Section 10.14 and the Trustee shall not
be liable for any loss or losses realized on such investments,
negligence, wilful acts or defaults only excepted.
10.15 ACTION BY TRUSTEE TO PROTECT INTERESTS
The Trustee shall be entitled and empowered, either in its own name or
as trustee of an express trust, or as power of attorney or
attorney-in-fact for the Holders, or in any one or more of such
capacities, to file such proof of debt, amendment of proof of debt,
claim, petition or other document as may be necessary or advisable in
order to have the claim of the Trustee and of the Holders allowed in
any insolvency, bankruptcy, liquidation or other judicial proceedings
relative to the Corporation or its creditors or relative to or
affecting its property. The Trustee is hereby irrevocably appointed
(and the successive respective Holders by taking and holding the same
shall be conclusively deemed to have so appointed the Trustee) the true
and lawful agent, power of attorney or attorney-in-fact of the
respective Holders with authority to make and file in the respective
names of the Holders or on behalf of the Holders as a class, subject to
deduction from any such claims of the amounts of any claims filed by
any of the Holders themselves, any proof of debt, amendment of proof of
debt, claim, petition or other documents in any such proceedings and to
receive payment of any sums becoming distributable on account thereof,
and to execute any such other papers and documents and to do and
perform any and all such acts and things for and on behalf of such
Holders, as may be necessary or advisable in the opinion of the
Trustee, in order to have the respective claims of the Trustee and of
the Holders against the Corporation or its property allowed in any such
proceeding, and to receive
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payment of or on account of such claims; provided, however, that
nothing contained in this Indenture shall be deemed to give to the
Trustee, unless so authorized by Extraordinary Resolution, any right to
accept or consent to any plan of reorganization or otherwise by action
of any character in such proceeding to waive or change in any way any
right of any Debentureholder.
The Trustee shall have the power to institute and maintain all and any
such actions, suits or proceedings as it may consider necessary or
expedient to preserve, protect or enforce its interests and the
interests of the Holders of the Debentures.
Any such suit or proceeding instituted by the Trustee may be brought in
the name of the Trustee as trustee or agent hereunder, and any recovery
of judgment shall be for the rateable benefit of the Holders of the
Debentures subject to the provisions of this Indenture. In any
proceeding brought by the Trustee (and also any proceeding in which a
declaratory judgment of a court may be sought as to the interpretation
or construction of any provision of this Indenture, to which the
Trustee shall be a party) the Trustee shall be held to represent all
the Holders, and it shall not be necessary to make any Holders of the
Debentures parties to any such proceeding.
10.16 REPLACEMENT OF TRUSTEE
The Trustee may resign from its functions and the trusts hereunder and
thereupon be discharged from all further duties and liabilities
hereunder by giving to the Corporation 60 days' notice in writing or
such shorter notice as the Corporation may accept as sufficient. The
Debentureholders by Extraordinary Resolution shall have power at any
time to remove the Trustee and to appoint a new trustee hereunder. In
the event of the Trustee resigning or being removed as aforesaid or
being dissolved, becoming bankrupt, going into liquidation or otherwise
becoming incapable of acting hereunder, the Corporation shall forthwith
appoint a new trustee hereunder unless a new trustee has already been
appointed by the Debentureholders; failing such appointment by the
Corporation, the retiring trustee hereunder (at the expense of the
Corporation) or any Debentureholder may apply to a Judge of the Quebec
Superior Court (or, if such court declines jurisdiction, any court of
the Province of Quebec accepting jurisdiction), on such notice as such
Judge may direct, for the appointment of a new trustee hereunder; but
any trustee so appointed by the Corporation or by the Court shall be
subject to removal as aforesaid by the Debentureholders. Any new
trustee hereunder appointed under any provision of this Section 10.16
shall be a company authorized and qualified to carry on the business of
a trust company in the Province of Quebec and every other jurisdiction
where such authorization or qualification is necessary to enable it to
act as a trustee hereunder, shall certify that it will not have any
material conflict of interest upon becoming trustee hereunder, and
shall accept the trust herein declared and provided for. On any new
appointment the new trustee shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named
herein as Trustee.
Any company into which the Trustee may be merged or with which it may
be consolidated or amalgamated, or any company resulting from any
merger, consolidation or amalgamation to which the Trustee shall be a
party, shall be the successor Trustee under this Indenture without the
necessity of the execution of any instrument or any further act.
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10.17 ACCEPTANCE OF TRUST
The Trustee hereby accepts any and all trusts created or constituted
for the purposes of Sections 3.6, 5.7 and 6.2, agrees to perform the
same upon the terms and conditions herein set forth and, to the extent
any such terms and conditions conflict with any provisions of
applicable law, such terms and conditions shall prevail to the extent
that such provisions do not constitute provisions of public order.
10.18 FONDE DE POUVOIR
The Trustee hereby agrees to act as the fonde de pouvoir (holder of the
power of attorney) of the Holders of the Debentures to the extent
necessary or desirable for the purposes of this Indenture and each
Debentureholder by receiving and holding the Debentures accepts and
confirms the appointment of the Trustee as fonde de pouvoir (holder of
the power of attorney) of such Holder to the extent necessary for the
purposes hereof and in accordance with and subject to the provisions
hereof.
To the extent necessary and for greater certainty (but without in any
way detracting from custom and usage applicable with regards to the
relationship between the Corporation, the Trustee and the
Debentureholders hereunder) and subject to any applicable law of public
order, the Trustee and the Corporation hereby agree with regard to the
Trustee so acting as fonde de pouvoir (holder of the power of attorney)
of the Debentureholders hereunder and each Debentureholder by receiving
and holding the Debentures agrees with the Corporation and the Trustee
that:
10.18.1 notwithstanding any other provision hereof and except as may
be otherwise set forth in an Extraordinary Resolution or other
request or direction of any of the Holders of Debentures
pursuant to this Indenture, relating thereto, no
Debentureholder shall be liable to third parties for acts
performed by the Trustee (or any other Person appointed by the
Trustee to perform all or any of its rights, powers, trusts or
duties hereunder) during the exercise of its rights, powers
and trusts and the performance of its duties under this
Indenture or for injury caused to such parties by the fault of
the Trustee (or any such Person), or for contracts entered
into in favour of such parties, during such performance and
the Trustee (or any such Person) alone shall be so liable
subject to any rights or recourses which the Trustee (or any
such Person) may have hereunder or under any applicable law
against the Corporation or any other Person (other than a
Debentureholder) in connection with any such liability;
10.18.2 except as otherwise expressly provided herein or in an
Extraordinary Resolution or other request or direction of any
of the Holders of Debentures pursuant to this Indenture, the
Trustee shall not be entitled to receive from the
Debentureholders any remuneration or compensation for any
services rendered by the Trustee hereunder or reimbursement of
any costs, expenses, liabilities, disbursements or advances
incurred or made by the Trustee in accordance with any
provision of this Indenture or interest thereon;
10.18.3 notwithstanding any other provision hereof and except as may
be otherwise set forth in an Extraordinary Resolution, or
other request or direction of any of the Holders of Debentures
pursuant to this Indenture, relating thereto, no
Debentureholder shall be liable to compensate the Trustee for
any injury suffered by it by reason of the performance of
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its rights, powers, trusts or duties hereunder subject to any
rights or recourses which the Trustee may have hereunder or
under any applicable law against the Corporation or any other
Person (other than a Debentureholder) in connection with such
injury;
10.18.4 neither the death nor bankruptcy of a Debentureholder shall
terminate the Trustee's rights, powers, trusts or duties
hereunder with respect to the Debentures held by such
Debentureholder which shall continue to apply in favour of the
Holder or Holders who have acquired such Debentures from such
deceased or bankrupt Debentureholder;
10.18.5 the bankruptcy of the Trustee shall not terminate its rights,
powers, trusts and duties hereunder provided that such rights,
powers, trusts and duties are assumed by a successor Trustee
appointed in accordance with the provisions of Section 10.16;
10.18.6 so long as any Debentures remain outstanding, (i) each
Debentureholder hereby renounces to its right to revoke any
mandate relationship created between such Holder and the
Trustee hereunder and (ii) the Trustee hereby agrees that it
will not revoke any such mandate relationship except through a
resignation pursuant to and in compliance with the provisions
of Section 10.16; and
10.18.7 except as otherwise expressly provided herein or in an
Extraordinary Resolution or other request or direction of any
of the Holders of Debentures pursuant to this Indenture, the
Trustee shall not be obliged to render any account to the
Debentureholders nor return to the Debentureholders any
amounts which it has received in the performance of its duties
hereunder nor pay any interest to the Debentureholders on such
amounts.
ARTICLE 11
SUPPLEMENTAL INDENTURES
11.1 SUPPLEMENTAL INDENTURES
From time to time the Trustee and, when authorized by a resolution of
the directors, the Corporation may and they shall, when required by
this Indenture, execute, acknowledge and deliver by their proper
officers deeds or indentures supplemental hereto, which thereafter
shall form part hereof, for any one or more of the following purposes:
11.1.1 adding to the provisions hereof such additional covenants of
the Corporation, enforcement provisions and other provisions
for the protection of the Holders of the Debentures and/or
providing for events of default in addition to those herein
specified;
11.1.2 making such provisions not inconsistent with this Indenture as
may be necessary or desirable with respect to matters or
questions arising hereunder, including the making of any
modifications in the form of the Debentures which do not
affect the substance thereof and which, in the opinion of the
Trustee, it may be expedient to make, provided that the
Trustee shall be of the opinion that such provisions and
modifications will not be prejudicial to the interests of the
Debentureholders;
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11.1.3 evidencing the succession, or successive successions, of other
companies to the Corporation and the covenants of and
obligations assumed by any such successor in accordance with
the provisions of this Indenture;
11.1.4 giving effect to any Extraordinary Resolution passed as
provided in Article 8;
11.1.5 making any modification of any of the provisions of this
Indenture or the Debentures which is of a formal, minor or
technical nature;
11.1.6 making any additions to, deletions from or alterations of the
provisions of this Indenture (including any of the terms and
conditions of the Debentures) which, in the opinion of the
Trustee, are not materially prejudicial to the interests of
the Debentureholders and which are necessary or advisable in
order to incorporate, reflect or comply with Indenture
Legislation;
11.1.7 adding to or altering the provisions hereof in respect of the
transfer of Debentures, including provision for the exchange
of Debentures of different denominations, and making any
modification in the form of the Debentures which does not
affect the substance thereof and which, in the opinion of the
Trustee, is not materially prejudicial to the interests of the
Debentureholders;
11.1.8 correcting or rectifying any ambiguities, defective
provisions, errors or omissions herein, provided that, in the
opinion of the Trustee, the rights of the Trustee and the
Debentureholders are in no way prejudiced thereby;
11.1.9 modifying, eliminating or adding to the provisions of this
Indenture to such extent as shall be necessary or desirable as
a result of the coming into force of the Civil Code or any
subsequent judicial interpretation thereof, provided such
action pursuant to this Clause shall not, in the judgment of
the Trustee, adversely affect the interests of the Holders of
the Debentures in any material respect; and
11.1.10 any other purpose not inconsistent with the terms of this
Indenture provided that, in the opinion of the Trustee, the
rights of the Trustee and of the Debentureholders are in no
way prejudiced thereby.
ARTICLE 12
EXECUTION
12.1 COUNTERPARTS AND FORMAL DATE
This Indenture may be executed in several counterparts, each of which
when so executed shall be deemed to be an original, and such
counterparts together shall constitute one and the same instrument and
notwithstanding their date of execution shall be deemed to bear date as
of April 22, 1998.
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12.2 LANGUAGE OF INDENTURE
The parties hereto have required that this Indenture and all contracts,
documents or notices relating thereto be drafted in the English
language; les parties a cet acte ont exige que cet acte et tout
contrat, document ou avis y afferent soit redige en langue anglaise.
IN WITNESS WHEREOF, the parties hereto have executed this Indenture as of the
date and as at the place first herein above mentioned.
SR TELECOM INC.
PER: /s/ W. Xxxxxx Xxxxxxxx
---------------------------
President
MONTREAL TRUST COMPANY
Per:
---------------------------
Per: /s/ Xxxxxx Xxxxxxxxxx
---------------------------
SCHEDULE A
FORM OF DEBENTURE
[ENGLISH LANGUAGE VERSION]
Certificate No. _ SR TELECOM INC. Principal amount/Currency
(incorporated under the laws of Canada) CUSIP No. _
Date of issue: April 22, 1998 Maturity Date: April 22, 2005
8.15% DEBENTURE DUE APRIL 22, 2005
SR TELECOM INC., (hereinafter called the "Corporation") for value received
hereby acknowledges itself indebted and promises to pay to
or registered assigns (the "Holder") on
April 22, 2005, or on such earlier date as the principal hereof may become due
in accordance with the provisions of the Indenture hereinafter mentioned, the
principal sum of DOLLARS in lawful money of
Canada on presentation and surrender of this Debenture at the principal office
of the Trustee in Montreal, Quebec and to pay interest on the said principal sum
at the rate of 8.15% per annum in like money; half-yearly on April 22 and
October 22 in each year, commencing October 22, 1998 until payment of the said
principal sum, from the date hereof or from the last Interest Date (as defined
in the Indenture) to which interest shall have been paid or made available for
payment whichever shall be the later, such interest to be payable at the
principal office of the Trustee in Montreal, Quebec and should the Corporation
at any time make default in the payment of the principal or interest, to pay
interest on the amount in default at the same rate in like money at the same
place and half-yearly on the same dates. Interest hereon shall be payable
(except at maturity when interest may at the option of the Corporation be paid
on surrender hereof) by cheque mailed to the registered holder hereof as
provided in the Indenture and, subject to the provisions of the Indenture, the
mailing of such cheque shall satisfy and discharge the liability for interest on
this Debenture to the extent of the sum represented thereby plus the amount of
any tax which the Corporation is required to and does withhold therefrom.
This Debenture is one of the Debentures of the Corporation issued or
issuable under the provisions of an indenture (which indenture together with all
instruments supplemental or ancillary thereto is herein referred to as the
"Indenture") made as of April 22, 1998 between the Corporation and Montreal
Trust Company as Trustee (hereinafter called the "Trustee"). The 8.15%
Debentures, Due 2005 (herein sometimes referred to as the "Debentures") of which
this is one, are limited to an aggregate principal amount of $75,000,000 in
lawful money of Canada and mature on April 22, 2005.
This Debenture and all other Debentures certified and delivered under
the Indenture rank equally and ratably without discrimination, preference or
priority. This Debenture is an unsecured direct obligation of the Corporation.
Reference is made to the Indenture for particulars of the rights of the holders
of Debentures and of the Corporation and of the Trustee and the terms and
conditions upon which the Debentures are issued and held, to all of which the
holder of this Debenture, by acceptance hereof, assents. The Holder of this
Debenture also accepts and confirms the appointment of the Trustee as fonde de
pouvoir (holder of the power
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of attorney) of the Holder of this Debenture to the extent necessary for the
purposes hereof and of the Indenture in accordance with and subject to the
provisions thereof.
The Corporation shall have the right at its option and upon prior
notice of not less than 30 days nor more than 60 days to redeem prior to April
22, 2005 at any time the whole or from time to time any part of the Debentures
for the time being outstanding at a price equal to the greater of 100% of the
principal amount thereof and the Canada Yield Price (as defined in the
Indenture), together in each case with accrued interest, if any, to the date
fixed for redemption.
The right is reserved to the Corporation to purchase Debentures in the
market, by tender or by private contract at any price.
In case an event of default, as defined in the Indenture, shall have
occurred, the principal of and interest on all Debentures outstanding under the
Indenture may be declared, and shall thereupon become, immediately due and
payable, with the effects and subject to the conditions set forth in the
Indenture. The Indenture contains provisions for the waiver of defaults and
cancellation of declarations and provides the terms and conditions under which
such waivers and cancellations may be made.
The Indenture contains provisions making binding upon all holders of
Debentures outstanding thereunder resolutions passed at meetings of such holders
held in accordance with such provisions and instruments in writing signed by the
holders of a specified majority of Debentures outstanding.
Upon presentation at the principal office of the Trustee in Montreal or
at such other facilities as the Corporation may provide from time to time,
subject to the provisions of the Indenture and upon compliance with the
reasonable requirements of the Trustee: (1) Debentures of any denomination may
be exchanged for Debentures of any other authorized denomination, in each case
of the same series and of the same aggregate principal amount; and (2) a
Debenture may be transferred by the registered holder thereof or his executors,
administrators or other legal representatives or his or their attorney duly
appointed in writing.
This Debenture shall not become obligatory for any purpose until it
shall have been authenticated by or on behalf of the Trustee for the time being
under the Indenture.
IN WITNESS WHEREOF SR Telecom Inc. has caused this Debenture to be signed by its
duly authorized officers and dated April 22, 1998.
SR TELECOM INC.
_______________________________________ ______________________________________
President Secretary
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REGISTRAR'S AUTHENTICATION
AUTHENTICATED FOR AND ON BEHALF OF SR TELECOM INC.
DATE OF AUTHENTICATION:
MONTREAL TRUST COMPANY
REGISTRAR
By ____________________________________
Authorized Officer
FORM OF TRANSFER
FOR VALUE RECEIVED, ____________________________________________________________
hereby assign(s) and transfer(s) unto _____________________________________, the
within Debenture, together with the principal thereof and all accrued interest
thereon, if any, by irrevocably constituting and appointing ____________________
_________________________________________to transfer such Debenture on the
securities register of SR Telecom Inc., with full power of substitution in the
premises.
Dated________________________________
In the presence of__________________________________
Signature
Transferee's social insurance number (if applicable): _____________________
- 4 -
(FRENCH LANGUAGE VERSION)
Certificat no - SR TELECOM INC. Capital/Monnaie:
(constituee en vertu des xxxx du Canada) CUSIP no-
Date d'emission : 22 avril 1998 Date d'echeance : 22 avril 2005
DEBENTURES A 8,15%, ECHEANT EN 2005
SR TELECOM INC. (ci-apres appelee la "societe"), pour valeur recue, reconnait
par les presentes devoir et promet de payer a___________________________________
______________________________________________________ou a ses ayants droit
inscrits (le "porteur"), le 22 avril 2005 ou a toute date anterieure a laquelle
le principal des presentes peut devenir exigible en vertu des dispositions de la
convention mentionnee ci-dessous, le montant en principal de____________________
_____________________________________DOLLARS en monnaie legale du Canada sur
presentation et remise de cette debenture au bureau principal du fiduciaire a
Montreal (Quebec) et de payer l'interet sur ledit montant en principal au taux
de 8,15% l'an, en la meme monnaie, semi-annuellement le 22 avril et le 22
octobre de chaque annee, a compter du 22 octobre 1998, jusqu'au paiement dudit
montant en principal, a compter de la date des presentes ou de la date de
paiement d'interet (selon la definition donnee dans la convention) a laquelle
les interets auront ete xxxxx ou reserves pour paiement sur les debentures,
selon la derniere de ces deux dates, cet interet etant payable au bureau
principal du fiduciaire a Montreal (Quebec). Au cas ou la societe ferait defaut,
a tout moment, de payer le principal ou tout interet sur cette debenture, elle
promet de payer l'interet sur le montant en defaut en la meme monnaie et au meme
taux, aux memes endroits et semi-annuellement, aux memes dates. L'interet sur
cette debenture sera payable (sauf a l'echeance alors que l'interet pourra, au
choix de la societe, etre paye sur remise de cette debenture) par cheque poste
au porteur inscrit de cette debenture, tel que le prevoit la convention et, sous
reserve des dispositions de la convention, l'envoi par la poste d'un tel cheque
satisfera et acquittera l'obligation de payer l'interet sur cette debenture
jusqu'a concurrence du montant represente par ce cheque plus le montant de toute
taxe ou impot que la societe est tenue de retenir et qu'elle retient.
Cette debenture est l'une des debentures de la Societe emises ou pouvant etre
emises en vertu des dispositions d'une convention (cette convention, ainsi que
tous les actes supplementaires ou se rattachant a celle-ci, sont ci-apres
appeles la "convention") intervenue en date du 22 avril 1998 entra la societe et
la Compagnie Montreal Trust (ci-apres appelee le "fiduciaire") a titre de
fiduciaire. Les debentures a 8,15%, echeant en 2005 (ci-apres quelquefois
appelees les "debentures"), dont cette debenture fait partie, sont limitees au
montant en principal global de 75 000 000 $ en monnaie legale du Canada et
viennent a echeance le 22 avril 2005.
Cette debenture prend rang egal et proportionnel avec toutes les autres
debentures attestees et livrees en vertu de la convention, sans distinction,
preference ou priorite. Cette debenture constitue une obligation directe non
garantie de la societe. II y a lieu de se reporter a la convention pour le
detail des droits des porteurs de debentures, ceux de la societe et du
fiduciaire et pour le detail des modalites et conditions en vertu desquelles les
debentures sont emises et detenues, a l'ensemble desquels le porteur de cette
debenture consent par son acceptation des presentes. Le porteur accepte et
confirme la nomination du fiduciaire a titre de fonde de
- 5 -
pouvoir du porteur de cette debenture dans la mesure necessaire pour les fins de
cette debenture et de la convention, conformement a leurs dispositions
respectives et sous reserves de celles-ci.
La societe aura le droit, a son gre, sur preavis d'au moins 30 jours et d'au
plus 60 jours, xx xxxxxxxx avant le 22 avril 2005 en totalite ou de temps a
autre en partie les debentures alors en circulation a un prix egal au plus eleve
de 100% de leur montant en principal et du prix base sur le rendement des
obligations du gouvernement du Canada (tel que ce terme est defini a la
convention), majore dans chaque cas de l'interet couru jusqu'a la date fixee
pour le rachat, s'il en est.
La societe se reserve le droit d'acheter, a quelque prix que ce soit, des
debentures sur le marche, par xxxxx d'offres ou par convention privee.
Dans le cas d'un defaut, tel que le definit la convention, le principal et
l'interet de toutes les debentures en cours en vertu de la convention peuvent
etre declares immediatement dus et exigibles et le devenir des lors, avec les
consequences et sous reserve des conditions contenues dans la convention. La
convention contient des dispositions concernant la renonciation aux defauts et
l'annulation xx xxxxxx declarations et precise les modalites et conditions
auxquelles sont soumises ces renonciations et annulations.
La convention contient des dispositions qui prevoient que tous les porteurs de
debentures en cours seront lies par des resolutions adoptees aux assemblees de
tels porteurs, tenues conformement a xx xxxxxx dispositions, ainsi que par des
ecrits signes par les porteurs d'une majorite specifiee de debentures en cours.
Sur presentation au bureau principal du fiduciaire a Montreal, ou a tout autre
endroit que peut choisir la societe de temps a autre, mais sous reserve des
dispositions de la convention et une fois satisfaites les exigences raisonnables
du fiduciaire: 1) les debentures de toute coupure peuvent etre echangees pour
des debentures de toute autre coupure autorisee, dans chaque cas de la meme
serie et pour un meme montant en principal global; et 2) une debenture peut etre
transferee par son porteur inscrit ou ses executeurs, administrateurs ou autres
representants xxxxxx, ou par son ou leur fonde de pouvoir dument mandate par
ecrit.
Cette debenture ne xxxxx la societe que lorsqu'elle aura ete attestee par le
fiduciaire alors en fonction en vertu de la convention ou au nom de celui-ci.
EN FOI DE QUOI SR Telecom Inc. a fait signer la presente debenture par
ses dirigeants dument autorises et date celle-ci du 22 avril 1998
SR TELECOM INC.
_____________________________________ _____________________________________
Le President Le Secretaire
- 6 -
AUTHENTIFICATION DE L'AGENT CHARGE
DE LA TENUE DES REGISTRES
AUTHENTIFIEE POUR LE COMPTE DE SR TELECOM INC.
DATE D'AUTHENTIFICATION:
COMPAGNIE MONTREAL TRUST
AGENT CHARGE
DE LA TENUE DES REGISTRES
Par ______________________________
Dirigeant autorise
FORMULAIRE DE TRANSFERT
CONTRE VALEUR RECUE,____________________________________________________________
vend(ent), cede(nt) et transfere(nt) par les presentes a _______________________
______________________, la presente debenture, de meme que le capital de
celle-ci et tous les interets courus sur celle-ci, s'il en est, et constitue(nt)
et nomme(nt) irrevocablement_______________________________________________aux
fins du transfert de cette debenture dans le registre des valeurs mobilieres de
SR Telecom Inc., avec pleins pouvoirs de substitution a cet egard.
Date__________________________
En presence de________________________
_________________________
Signature
Numero d'assurance sociale de cessionnaire (s'il en est): ______________________
