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EXHIBIT 99.08
SECURITIES PLEDGE AGREEMENT
TO: CANADIAN IMPERIAL BANK OF COMMERCE
Commerce Court West - 7th Floor
Toronto, Ontario
M5L 1A2
WHEREAS in order to secure the due payment and performance of the Obligations
(as defined below), the undersigned (the "Debtor") has agreed to pledge the
Pledged Securities (as defined below) to Canadian Imperial Bank of Commerce, as
agent (in that capacity, the "Agent") for the benefit of the lenders
(collectively, the "Lenders", the present Lenders being Canadian Imperial Bank
of Commerce and The Bank of Nova Scotia) from time to time parties to the
credit commitment agreement titled "Summary of Terms and Conditions" dated May
24, 1996 among Xxxxxxxxx International Inc., Xxxxxxxxx Inc., Canadian Imperial
Bank of Commerce and the Agent (as supplemented by an assignment agreement
dated as of July 17, 1996 among Xxxxxxxxx International Inc., Canadian Imperial
Bank of Commerce and The Bank of Nova Scotia and as further supplemented,
amended, restated or replaced from time to time, the "Credit Agreement").
THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are conclusively acknowledged by the parties hereto, the Debtor hereby
agrees as follows:
1. DEFINED TERMS. In this Agreement, the following words have the following
meanings:
"Companies" means the corporations, companies, partnerships, limited
partnerships, trusts and other entities listed under the heading "Companies" in
Schedule "A" and their respective successors;
"Default" means a failure to pay any of the Obligations when due;
"Lien" means a mortgage, hypothec, title retention, pledge, lien, charge,
security interest or other encumbrance whatsoever, whether fixed or floating
and howsoever created or arising;
"Obligations" means all present and future indebtedness and liabilities of
every kind, nature and description (whether direct or indirect, joint or
several, absolute or contingent, matured or unmatured) of the Debtor to the
Agent and the Lenders under or pursuant to the guarantee dated the date hereof
made by the Debtor in favour of the Agent in respect of Xxxxxxxxx International
Inc. and any unpaid balance thereof; and
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"Pledged Securities" means the securities listed under the heading "Pledged
Securities" in Schedule "A", together with any other securities in the capital
of the Companies owned by the Debtor from time to time (other than 15,950,000
Class A Common Stock of Xxxxxxxxx International Inc. presently owned by the
Debtor and evidenced or represented by share certificate #A0358).
2. PLEDGE. As general and continuing collateral security for the payment and
performance of all Obligations, the Debtor hereby assigns and pledges to and in
favour of the Agent, and the Debtor hereby grants to the Agent a continuing
security interest in the following (collectively, the "Collateral"): (i) the
Pledged Securities, together with any replacements thereof and substitutions
therefor, and all certificates and instruments evidencing or representing such
securities; (ii) all dividends, whether in cash, kind or stock, received or
receivable upon or in respect of any of the Pledged Securities and all moneys
or other property payable or paid on account of any return or repayment of
capital in respect of any of the Pledged Securities or otherwise distributed in
respect thereof or which will in any way be charged to, or payable or paid out
of, the capital of any of the Companies on account of the Pledged Securities;
(iii) all other property that may at any time be received or receivable by or
otherwise distributed to the Debtor in respect of, or in substitution for, or
in exchange for, any of the foregoing; and (iv) all cash, securities and other
proceeds of the foregoing and all rights and interests of the Debtor in respect
thereof or evidenced thereby, including all moneys received from time to time
by the Debtor in connection with the sale or other disposition of any of the
Pledged Securities; provided, however, that the Debtor will not sell or
otherwise dispose of any of the Pledged Securities or purport to do any of the
foregoing without the prior written consent of the Agent.
3. DELIVERY OF PLEDGED SECURITIES. The certificates representing the Pledged
Securities duly endorsed by the appropriate person in blank for transfer or
accompanied by powers of attorney satisfactory to the Agent will forthwith be
delivered to and remain in the custody of the Agent or its nominee. All
Pledged Securities may, at the option of the Agent, be registered in the name
of the Agent or its nominee. If the Agent so requests, the certificates
representing the Pledged Securities will also be guaranteed by a Canadian
chartered bank.
4. REPRESENTATIONS AND WARRANTIES. The Debtor hereby represents and warrants
to the Agent and acknowledges that the Agent is relying thereon,
notwithstanding any investigation by the Agent or any Lender or otherwise,
that: (i) the Debtor is the lawful owner of the Collateral, free and clear of
any and all Liens or claims of others other than any Lien granted by the Debtor
to the Agent hereunder or Liens in favour of Canadian Imperial Bank of
Commerce, with full right to deliver, assign, pledge and charge the
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Collateral to the Agent pursuant hereto; (ii) the Pledged Securities represent
all of the issued and outstanding shares in the capital of each of the Companies
held by the Debtor (other than 15,950,000 Class A Common Stock of Xxxxxxxxx
International Inc. referred to in the definition of "Pledged Securities"); (iii)
the Pledged Securities are validly issued, fully paid and non-assessable; (iv)
there is no existing agreement, option, right or privilege capable of becoming
an agreement or option pursuant to which the Debtor would be required to sell or
otherwise dispose of any of the Pledged Securities; (v) except as otherwise
agreed by the Agent in writing, the Liens granted by the Debtor to the Agent
pursuant to this Agreement constitute Liens on the Collateral in favour of the
Agent which are prior to all other Liens on the Collateral other than Liens in
favour of Canadian Imperial Bank of Commerce, whether created by the Debtor or
any other Person, and in existence on the date hereof; (vi) the Debtor has the
power and authority and the legal right to execute and deliver, to perform its
obligations under, and to grant the Lien on the Collateral pursuant to, this
Agreement and the Debtor has taken all necessary corporate action to authorize
its execution, delivery and performance of, and grant of the Lien on the
Collateral pursuant to, this Agreement; (vii) this Agreement constitutes a
legal, valid and binding obligation of the Debtor, enforceable in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general principles of equity; (viii) the
execution, delivery and performance of this Agreement will not violate any
provision or requirement of any law or contractual obligation of the Debtor and
will not result in the creation or imposition of any Lien on any of the
properties or revenues of the Debtor pursuant to any requirement of law or
contractual obligation of the Debtor; (ix) no consent or authorization of,
filing with, or other act by or in respect of, any arbitrator or governmental
authority and no consent of any other person (including any shareholder or
creditor of the Debtor), is required in connection with the execution, delivery,
performance, validity or enforceability of this Agreement, except for such as
have been obtained or made and are in full force and effect, and the terms of
which have been disclosed to the Agent; and (x) no litigation, investigation or
proceeding of or before any arbitrator or governmental authority is pending or,
to the knowledge of the Debtor, threatened by or against the Debtor or against
any of its properties or revenues which may materially adversely affect the
business, property or financial or other condition of the Debtor.
5. COVENANTS. The Debtor covenants and agrees with the Agent that: (i) at
any time and from time to time, upon the written request of the Agent, and at
the sole expense of the Debtor, the Debtor will promptly and duly execute and
deliver such further instruments and documents and take such further action as
the Agent may request for the purpose of obtaining or preserving the full
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benefits of this Agreement and of the rights and powers herein granted,
including the filing or execution of any financing or financing change
statements under any applicable legislation in effect in any jurisdiction with
respect to the Liens created hereby; (ii) the Debtor authorizes the Agent to
file any such financing or financing change statement without the signature of
the Debtor to the extent permitted by applicable law; (iii) the Debtor will not
create, incur or permit to exist, but will defend the Collateral against, and
will take such other action as is necessary to remove, any Lien or claim on or
to the Collateral, other than the Liens created hereby and Liens in favour of
Canadian Imperial Bank of Commerce and other than as permitted in writing by
the Agent; (iv) the Debtor will not sell, transfer, lease or otherwise dispose
of any of the Collateral except as permitted in writing by the Agent; and (v)
the Debtor will ensure that at the request of the Agent, all Pledged Securities
are registered in the name of the Agent or its nominee, that the certificates
representing the Pledged Securities will be forthwith delivered to and remain
in the custody of the Agent or its nominee, and that all certificates,
instruments or other documents representing or evidencing any Pledged
Securities acquired or issued subsequent to the date hereof will be registered
in the name of the Agent or its nominee and will forthwith after issuance be
delivered to, and remain in the custody of, the Agent or its nominee.
6. RIGHTS AND DUTIES OF AGENT. The Agent will have and be entitled to
exercise all such powers hereunder as are specifically delegated to the Agent
by the terms hereof, together with such powers as are incidental thereto. The
Agent may execute any of its duties hereunder by or through agents and will be
entitled to retain counsel and to act in reliance upon the advice of such
counsel concerning all matters pertaining to its duties hereunder. The Agent
and any nominee on its behalf will be bound to exercise in the holding of the
Pledged Securities and other Collateral only the same degree of care as it
would exercise with respect to similar property of its own held in the same
place. Neither the Agent, nor any Lender, nor any nominee acting on behalf of
the Agent or any Lender, nor any director, officer or employee of the Agent or
any Lender or such nominee, will be liable for any action taken or admitted to
be taken by it hereunder or in connection herewith except for its own gross
negligence or wilful misconduct.
7. VOTING RIGHTS. Unless a Default has occurred and is continuing, the Debtor
will be entitled to exercise all voting power from time to time exercisable in
respect of the Pledged Securities and give consents, waivers and ratifications
in respect thereof. Immediately upon the occurrence and during the continuance
of any Default, all such rights of the Debtor to vote and give consents,
waivers and ratifications will cease and the Agent will be entitled to exercise
all such voting rights and to give all consents, waivers and ratifications as
permitted by the Agent.
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8. DIVIDENDS. Unless a Default has occurred and is continuing, the Debtor
will, subject to any agreement with the Agent to the contrary, be entitled to
receive any and all cash dividends and other distributions on the Pledged
Securities which it is otherwise entitled to receive. If a Default has
occurred and is continuing, the Agent will have the sole and exclusive right
and authority to receive and retain the dividends and other distributions which
the Debtor would otherwise be authorized to receive. Any money and other
property paid over to or received by the Agent pursuant to the provisions of
this Section 8 will be retained by the Agent as additional Collateral hereunder
and be applied in accordance with the provisions hereof.
9. REMEDIES. If a Default has occurred and is continuing, the Agent may,
without notice to or the consent of the Debtor or any other person (other than
as required by applicable law), take all or any of the following actions:
(a) transfer all or any part of the Collateral into the name of the Agent or
any Lender or any nominee on behalf of the Agent or any Lender, with or
without disclosing that such Collateral is subject to the Lien hereunder;
(b) notify any parties obligated on any of the Collateral to make payment to
the Agent or any Lender of any amounts due or to become due thereunder;
(c) exercise any and all rights of conversion, exchange, subscription or any
other rights, privileges or options pertaining to any of the Pledged
Securities as if it were the absolute owner thereof;
(d) from time to time realize upon, collect, sell, transfer, assign, give
options to purchase, or otherwise dispose of and deliver the Pledged
Securities and other Collateral, or any part thereof, in such a manner as
may seem to it advisable, and for the purposes thereof each and every
requirement relating thereto and prescribed by law or otherwise is hereby
waived to the extent permitted by law;
(e) enforce collection of any of the Collateral by suit or otherwise, and
surrender, release or exchange all or any part of any property in addition
to the Collateral, securing any of the Obligations, or compromise or
extend or renew for any period (whether or not longer than the original
period) any obligations of any nature of any party with respect to any
property; and
(f) to the extent permitted by applicable law, the Agent or any Lender may
purchase any or all of the Pledged Securities and other Collateral,
whether in connection with a sale made under the power of sale herein
contained or pursuant to judicial proceedings or otherwise;
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provided, however, that the Agent and the Lenders will not be bound to deal
with the Pledged Securities and other Collateral as aforesaid, and will not be
liable for any loss which may be occasioned by any failure to do so and no
action of the Agent or any Lender permitted hereunder will impair or affect any
rights of the Agent or any Lender in and to the Collateral.
10. APPLICATION OF PROCEEDS. After payment of expenses as provided in Section
11 hereof, the balance of any proceeds received by the Agent in or in
connection with realizing, collecting, selling, transferring, delivering or
obtaining payment of the Collateral or any part thereof may be held by the
Agent and may, as and when the Agent thinks fit, be applied on account of such
part of the Obligations as to the Agent seems best, without prejudice to the
Agent's and the Lenders' claims upon the Debtor for any deficiency.
11. PAYMENT OF EXPENSES. The Agent may charge on its own behalf and also pay
to others all out-of-pocket expenses of the Agent and others retained by the
Agent, incurred in connection with realizing, collecting, selling,
transferring, delivering or obtaining payment of the Pledged Securities or any
other Collateral or any part thereof, or in connection with the administration
or amendment of this Agreement or incidental to the care, safe keeping, or
otherwise of any and all of the Collateral, and may deduct the amount of such
sums from any proceeds of the Collateral. The Debtor agrees to indemnify and
hold harmless the Agent and the Lenders from and against any and all liability
incurred by the Agent, any Lender or any nominee, agent or employees of the
Agent or any Lender hereunder or in connection herewith, unless such liability
was due to wilful misconduct or gross negligence on the part of the Agent or
Lender or such nominee or agent.
12. ASSIGNMENT. This Agreement will be binding upon the Debtor and its
successors and permitted assigns and will enure to the benefit of and be
enforceable by the Agent and the Lenders and their respective successors and
assigns. The Debtor will not assign all or any part of this Agreement without
the Agent's prior written consent.
13. NO WAIVER: CUMULATIVE REMEDIES. Neither the Agent nor any Lender will by
any act, delay, indulgence, omission or otherwise be deemed to have waived any
right or remedy hereunder or to have acquiesced in any breach of any of the
terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Agent or any Lender, any right, power or
privilege hereunder will operate as a waiver thereof.
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hereunder shall be in writing, personally delivered to an officer or other
responsible employee of the addressee or sent by registered mail, charges
prepaid, or by telecopy, to the address or telecopy number set forth opposite
the name of the Debtor in the execution pages of this Agreement, in the case of
the Debtor, and to Canadian Imperial Bank of Commerce, Head Office, Commerce
Court West, 7th Floor, Toronto, Ontario M5L 1A2 (Attention: Vice-President,
Global Media & Telecommunications) (Telecopy: (000) 000-0000), in the case of
the Agent and the Lenders, or to such other address as the applicable party
hereto may from time to time designate to the other in such manner. Any
communication so personally delivered shall be deemed to have been validly and
effectively given on the date of such delivery. Communications so sent by
telecopy shall be deemed to have been validly and effectively given on the
business day next following the day on which it is sent. Communications so sent
by mail shall be deemed to have been validly and effectively given on the fifth
business day next following the day on which it is sent.
15. DEALINGS BY AGENT AND LENDERS. The Agent and the Lenders may grant
extensions of time and other indulgences, take and give up security, accept
compositions, grant releases and discharges and otherwise deal with the Debtor
and any third party having dealings with the Debtor, and with the Collateral or
any part thereof, and with other security and sureties, as the Agent and the
Lenders may see fit, all without prejudice to the Obligations or to the rights
of the Agent and the Lenders under this Agreement. The Agent and the Lenders
will be accountable only for amounts that the Agent or any Lender actually
receives as a result of the exercise of such powers, and neither the Agent nor
any Lender nor any of their officers, directors, employees or agents will be
responsible to the Debtor for any act or failure to act hereunder, except for
its or their own gross negligence or wilful misconduct.
16. NON-EXCLUSIVITY OF REMEDIES. This Agreement and the Liens arising
hereunder are in addition to and not in substitution for any other security now
or hereafter held by the Agent or any Lender in respect of the Debtor, the
Obligations or the Collateral. No remedy for the enforcement of the rights of
the Agent and the Lenders hereunder will 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.
17. POWER OF ATTORNEY. The Debtor hereby irrevocably constitutes and appoints
the Agent and any officer or agent thereof, with full power of substitution, as
its true and lawful attorney-in-fact, with full irrevocable power and authority
in the place and stead of the Debtor and in the name of the Debtor or in its
own name, from time to time in the Agent's discretion, for the purpose of
carrying out the terms of this Agreement, to take any and all appropriate
action, to do, make and execute any and all statements, acts, matters,
documents, instruments and things which may be necessary
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14. COMMUNICATION. All communications provided for or permitted or desirable
to accomplish the purposes of this Agreement and from time to time to exercise
all rights and powers and to perform all acts of ownership in respect to the
Pledged Securities to the same extent as the Debtor might have done were it not
for this Agreement. The Debtor hereby ratifies all that said attorneys will
lawfully do or cause to be done by virtue hereof. This power of attorney is a
power coupled with an interest and will be irrevocable until the Obligations
have been paid and performed in full.
18. NO MERGER. Neither the taking and holding of the Pledged Securities and
other Collateral nor the obtaining of any judgment by the Agent or any Lender
will operate as a merger of any Obligation or any other indebtedness or
liability of the Debtor to the Agent or any Lender or operate to prejudice the
security constituted by this Agreement.
19. SEVERABILITY. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction will, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and any such prohibition or unenforceability in any
jurisdiction will not invalidate or render unenforceable such provision in any
other jurisdiction.
20. GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the laws of Ontario.
21. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All agreements,
representations, warranties and covenants made by or on behalf of the Debtor
herein are material, will be considered to have been relied upon by the Agent
and the Lenders and will survive the execution and delivery of this Agreement
or any investigation made at any time by or on behalf of the Agent or any
Lender and any disposition or payment of the Obligations until repayment in
full thereof.
22. ACKNOWLEDGEMENT OF RECEIPT. The Debtor acknowledges receipt of an
executed copy of this Agreement.
DATED: As of July 17, 1996.
ADDRESS 3184081 CANADA LIMITED
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00 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx By: /s/ X.X. XXXXXXXX
M5K 1N2 Name: X.X. Xxxxxxxx
Title: Vice-President,
Attention: President Finance & Treasury
Facsimile: (000) 000-0000
By:______________________c/s
Name:
Title:
Schedule A - Pledged Securities
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SCHEDULE "A"
CERTIFICATE
COMPANIES PLEDGED SECURITIES NUMBER
--------- ------------------ ------
NO. CLASS
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1. Xxxxxxxxx International Inc. 7,539,028 Class A A0499
Common Stock
