EXHIBIT 9
VOTING TRUST AGREEMENT
THIS AGREEMENT made as of the 12th day of June, 1998.
BY AND AMONG:
XXXXX X. XXXXXXXXX,
of the City of Toronto in the
Province of Ontario,
(hereinafter referred to as "Drabinsky"),
OF THE FIRST PART
- and -
XXXXX X. XXXXXXXX,
of the City of Toronto in the
Province of Ontario,
(hereinafter referred to as "Xxxxxxxx"),
OF THE SECOND PART
- and -
XXX X. XXXXXX,
of the City of New York in the
State of New York,
(hereinafter referred to as "Xxxxxx"),
OF THE THIRD PART
- and -
XXXXX X. XXXXXX,
of the City of Xxxxxxx Hills in the
State of California,
(hereinafter referred to as "Xxxxxx" and together with
Drabinsky, Gottlieb and Xxxxxx, as the "Shareholders"),
OF THE FOURTH PART
- and -
LYNX VENTURES L.P.,
a limited partnership existing under the laws of
the State of Delaware,
(hereinafter referred to as the "Investor" or the "Voting
Trustee"),
OF THE FIFTH PART,
- and -
MONTREAL TRUST COMPANY OF CANADA,
a trust company duly qualified to carry on business in
the Province of Ontario,
(hereinafter referred to as the "Depositary"),
OF THE SIXTH PART,
- and -
LIVENT INC.,
a corporation existing under the laws of
the Province of Ontario,
(hereinafter referred to as the "Corporation"),
OF THE SEVENTH PART.
WHEREAS the Shareholders have purchased, or have rights to
purchase, shares of common stock, no par value, of the Corporation (the
"Common Shares");
WHEREAS each Shareholder has agreed to deposit any Common Shares
beneficially owned by him which are free and clear of any encumbrances and
any other voting securities in the Corporation beneficially owned by such
Shareholder during the term of this Agreement, to the extent that such
shares are beneficially owned free and clear of all encumbrances, with the
Depositary to allow such securities to be voted by the Investor (the
"Voting Trustee") pursuant to the terms of this Agreement;
WHEREAS Drabinsky and Xxxxxxxx have also agreed that the Investor
shall have the right to purchase some or all of the Common Shares deposited
hereunder pursuant to an Option Agreement, dated as of April 13, 1998,
among Drabinsky, Gottlieb, the Corporation and the Investor (the "Option
Agreement");
WHEREAS the Shareholders, the Corporation and the Investor have
each entered into a Shareholders Agreement, dated as of the date hereof
(the "Shareholders Agreement"), pursuant to which the shares beneficially
owned by the Shareholders may be transferred by the Shareholders subject to
the terms and conditions set forth therein;
WHEREAS the Shareholders and the Investor have each entered into
a Voting Agreement, dated as of the date hereof (the "Voting Agreement"),
pursuant to which all Common Shares or voting securities beneficially owned
by the Shareholders and not subject to this Agreement are subject to the
voting arrangement set forth therein; and
WHEREAS the execution and delivery of this Agreement is a
condition precedent to the closing of the transactions contemplated by the
Investment Agreement, dated as of April 13, 1998 (the "Investment
Agreement"), between the Corporation and the Investor.
NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of
the respective covenants and agreements of the parties contained herein and
for other good and valuable consideration (the receipt and sufficiency of
which are hereby acknowledged by each of the parties hereto), the parties,
intending to be legally bound, hereby agree as follows:
1. DEPOSITED SHARES. Each of the Shareholders shall deliver forthwith to
the Depositary for deposit hereunder at its principal office in the City of
Toronto a certificate or certificates registered in his name, duly endorsed
in blank for transfer with signatures guaranteed by a Canadian chartered
bank or a broker member of a recognized exchange representing the number of
unencumbered Common Shares indicated opposite such Shareholder's name in
Schedule A annexed hereto (such shares being referred to herein as the
"Deposited Shares"). Each of the Shareholders, with respect to the
Deposited Shares beneficially owned by him, does hereby represent and
warrant that all such shares are free and clear of any encumbrances and
represent all of the unencumbered Common Shares or other voting securities
in the Corporation beneficially owned by him as of the date hereof. Each
of Drabinsky and Xxxxxxxx further represent and warrant that the Escrow
Agreement, dated May 7, 1993, by and among Drabinsky, Gottlieb and certain
members of management of the Corporation is no longer in force and that
Common Shares beneficially owned by Drabinsky and Xxxxxxxx are not subject
to any other escrow arrangements. Each of the Shareholders agrees and
covenants that any Common Shares or other voting securities in the
Corporation that hereafter become beneficially owned by such Shareholder
during the term of this Agreement shall be deposited with the Depositary
and shall thereafter be deemed to be Deposited Shares for all purposes.
The Shareholders and the Depositary will take any further actions or
execute and deliver any further documents or instruments necessary to
comply with the terms of this Agreement. Further, any Common Shares owned
by the Investor, now or hereafter, are not subject to the provisions of
this Voting Trust Agreement. Notwithstanding anything contained herein to
the contrary, the parties hereto agree that Deposited Shares may be
transferred to and held by the Depositary on a book basis in lieu of such
Deposited Shares being converted into certificated form.
2. ISSUE OF VOTING TRUST CERTIFICATES. The Depositary shall issue in the
name of each Shareholder and deliver forthwith to each such Shareholder a
voting trust certificate ("Voting Trust Certificate") substantially in the
form of the Voting Trust Certificate attached as Schedule B hereto
representing the Deposited Shares delivered and deposited hereunder by such
Shareholder, and the Depositary shall forthwith proceed to have such
Deposited Shares registered in its name on the registers of the
Corporation. The Depositary shall at all times ensure that the number of
Deposited Shares held by it pursuant to this Agreement is equivalent to the
aggregate number of all such shares represented by the outstanding Voting
Trust Certificates issued by it. The Depositary shall not be responsible
or liable in any manner whatsoever for the sufficiency, correctness,
genuineness or validity of any security deposited with it. Further, the
signature of the Depositary on the Voting Trust Certificates cannot be
interpreted as a representation of validity of the underlying Common Shares
or of the quality of the Common Shares.
3. EXERCISE OF VOTING RIGHTS BY VOTING TRUSTEE. Until the actual
redelivery of any Deposited Shares to the holder or holders of the Voting
Trust Certificates representing the same in accordance with the provisions
of this Agreement, the Voting Trustee shall, in respect thereof but subject
as hereinafter provided, exclusively possess and be entitled to exercise,
in person or by attorney, all the voting rights appertaining to the
Deposited Shares and all rights in connection with the initiation of,
taking part in and consenting to any action as a shareholder of the
Corporation, and the Shareholders and the Depositary shall from time to
time and at all times do whatever may be requested by direction in writing
by the Voting Trustee, including the execution and delivery of appropriate
instruments of proxy and/or powers of attorney, to enable and facilitate
the exercise of any and all such rights by or on behalf of the Voting
Trustee. The Depositary shall not be obligated to do any act or thing in
respect of the Deposited Shares absent an express written direction or
request signed by the Voting Trustee and delivered to the Depositary.
4. PAYMENT OF DIVIDENDS TO HOLDERS OF VOTING TRUST CERTIFICATES.
(a) The holder of each Voting Trust Certificate issued hereunder
shall be entitled to receive promptly from the Depositary payments by
cheque of the cash dividend or other distribution payments, if any,
received by the Depositary upon that number of Deposited Shares represented
by such Voting Trust Certificate. The payment made to the holders of
Voting Trust Certificates in respect of any such dividend shall be made to
the holders of record of such certificates, respectively, according to the
books of the Depositary as at the close of business on the record date
established by the Corporation for determining the shareholders entitled to
receive such cash dividend or distribution or, if no such record date is
established, as at the close of business on the date established by the
Corporation for payment to its shareholders of such cash dividend or
distribution. The Depositary will disburse monies according to this
Agreement only to the extent that monies have been deposited with it. In
the event that any funds are received by the Depositary in the form of an
uncertified check or checks, the Depositary shall be entitled to delay the
time for release of such part of the funds to any party until such
uncertified check or checks have cleared in the ordinary course the
financial institution upon which the same are drawn.
(b) The Depositary will not under any circumstances be obligated to
expend or risk its own funds. The forwarding of a check by the Depositary
will satisfy and discharge the Depositary's liability for any amounts due
to the extent of the sum or sums represented thereby (plus the amount of
any tax deducted or withheld as required by law) unless such check is not
honored on presentation; provided that in the event of the non-receipt of
such check by the payee, or the loss or destruction thereof, the Depositary
upon being furnished with reasonable evidence of such non-receipt, loss or
destruction and indemnity reasonably satisfactory to it, will issue to such
payee a replacement check for the amount of such check.
(c) In the event that the Depositary shall hold any amount of
interest or other distributable amount which is unclaimed or which cannot
be paid for any reason, the Depositary shall be under no obligation to
invest or reinvest the same but shall only be obligated to hold the same on
behalf of the person or persons entitled thereto in a current or other non-
interest bearing account pending payment to the person or persons entitled
thereto. The Depositary shall be entitled to retain for its own account
any benefit earned by the holding of such amount of unclaimed or unpaid
interest or such other unclaimed or unpaid distributable amount prior to
its disposition in accordance with this Section 4(c). The Depositary
shall, as and when required by law, and may at any time prior to such
required time, pay all or part of such interest or other distributable
amount so held to the Public Trustee (or other appropriate government
official or agency) whose receipt shall be a good discharge and release of
the Depositary.
5. REGISTER OF HOLDERS OF VOTING TRUST CERTIFICATES. The Depositary
shall keep a register at its principal office in the City of Toronto of the
names and addresses of the holders of all Voting Trust Certificates issued
and shall record the names and addresses of all transferees of Voting Trust
Certificates. The Depositary and the Voting Trustee shall at all times
treat and consider the registered holder of a Voting Trust Certificate on
the books of the Depositary as the holder thereof for all purposes.
6. TRANSFER OF VOTING TRUST CERTIFICATES.
(a) Except with the prior written consent of the Investor, Voting
Trust Certificates shall not be transferred, assigned, disposed of or
otherwise dealt with. Other than with the prior written consent of the
Investor, any attempt to transfer, assign, dispose of or otherwise deal the
Voting Trust Certificates shall be null and void, and the Depositary and
the Voting Trustee shall not recognize any such transfer, assignment,
disposition or dealing.
(b) Except with the prior written consent of the Investor, Voting
Trust Certificates shall not be mortgaged, pledged, charged, hypothecated
or otherwise encumbered or subject to any security interest. Other than
with the prior written consent of the Investor, any attempt to mortgage,
pledge, charge, hypothecate or otherwise encumber or subject the Voting
Trust Certificates to any security interest shall be null and void, and the
Depositary and the Voting Trustee shall not recognize any such mortgage,
pledge, charge, hypothecation, encumbrance or security interest.
(c) No transfer, assignment, disposition or other dealing with a
Voting Trust Certificate shall be valid for any purpose whatsoever unless
made on the register of the holders of Voting Trust Certificates maintained
by the Depositary by the registered holder of the Voting Trust Certificate
or his or their attorney duly appointed by an instrument in writing in form
and execution satisfactory to the Depositary, and upon compliance with such
reasonable requirements as the Depositary may prescribe, including such
reasonable evidence that the provisions of this Agreement have been duly
complied with.
7. RIGHT TO RECEIVE DEPOSITED SHARES. Upon the termination of this
Agreement or the occurrence of a Permitted Transfer (as defined below) of
Deposited Shares and, in each case, subject to the provisions of section 9
hereof, each Voting Trust Certificate shall entitle the registered holder
thereof or his or their attorney duly appointed by an instrument in writing
in form and execution satisfactory to the Depositary, to a certificate
representing the number of Deposited Shares represented thereby on
surrender of such Voting Trust Certificate, duly endorsed for transfer with
signatures guaranteed by a Canadian chartered bank, at the principal office
of the Depositary in the City of Toronto.
8. TERM AND TERMINATION OF VOTING TRUST AGREEMENT.
(a) This Agreement shall become effective as of the Closing Date (as
such term is defined under the Investment Agreement) and shall remain in
full force and effect, unless otherwise terminated in accordance with the
terms of this Agreement, from the Closing Date through to the date which is
twenty one (21) years after the death of the last living Shareholder.
(b) This Agreement may be terminated by the Voting Trustee at its
option at any time upon ten (10) days prior written notice to the
Depositary and to each of the Shareholders who hold a Voting Trust
Certificate at the time such notice is issued.
(c) This Agreement shall automatically terminate in the event that
the Corporation informs the Depositary, by providing sufficient
corroborating evidentiary information which is not disputed by the
Investor, that the Investor and its affiliates collectively beneficially
own less than the Share Limit (as defined below). As used herein, the term
"Share Limit" shall mean initially 500,000 Common Shares and shall be
appropriately adjusted from time to time to take into account dilutive
effects resulting from changes in the number of Common Shares outstanding
subsequent to the Effective Date, whether by recapitalization, declaration
of a stock split, payment of a stock dividend or otherwise.
9. RELEASE OF DEPOSITED SHARES.
(a) Upon the termination of this Agreement the Depositary shall
deliver to the registered holder or holders of the relevant Voting Trust
Certificates, certificates for the Deposited Shares represented by such
certificates registered in the names of, or to the order of, the holders of
such Voting Trust Certificates on surrender of such Voting Trust
Certificates, duly endorsed with signatures guaranteed by a Canadian
chartered bank, at the principal office of the Depositary in the City of
Toronto.
(b) In the event of the occurrence of a Permitted Transfer (as
defined below), a Shareholder desiring the release of Deposited Shares for
Transfer (as defined below) in connection with such Permitted Transfer
shall surrender the Voting Trust Certificates representing such Deposited
Shares, duly endorsed with signatures guaranteed by a Canadian chartered
bank, to the Depositary at the principal office of the Depositary in the
City of Toronto, and the Depositary shall deliver a certificate or
certificates representing such Deposited Shares registered to the order of
the Shareholder and shall also deliver a Voting Trust Certificate to the
Shareholder representing the number of Deposited Shares, if any, which
shall not be Transferred and shall remain as Deposited Shares. As to any
matters relating to the delivery of certificates representing such
Deposited Shares, the Depositary shall be entitled to rely solely upon
written instructions received from the Voting Trustee, but in the event of
a dispute among the foregoing, the opinion or advice of the Voting Trustee
shall prevail.
(c) As used herein, the term "Permitted Transfer" shall mean a
transaction pursuant to which a Shareholder sells, pledges, assigns, grants
a participation interest in, encumbers or otherwise transfers (each, a
"Transfer") the Deposited Shares to a third party and such Transfer is in
compliance with each of the following:
(i) the Transfer is in compliance with the terms and conditions
set forth in the Shareholders Agreement regarding the
Transfer of Common Shares owned by the Shareholder;
(ii) if such Transfer is in connection with the establishment of
a Permitted Encumbrance (as defined below) on Deposited
Shares, the beneficial owner of the Deposited Shares
released from this Agreement must continue to be entitled to
vote the released shares and all such released shares must
immediately become subject to the terms and conditions of
the Voting Agreement; and
(iii) with respect to any Transfer by Drabinsky and/or
Xxxxxxxx, the terms and conditions set forth in the
Option Agreement regarding the Transfer of Optioned
Shares (as defined therein) must be complied with;
provided that following such Transfer sufficient Common
Shares remain subject to this Agreement to satisfy the
exercise by the Investor of the options granted
pursuant to the Option Agreement.
In connection with determining whether a Transfer is a Permitted Transfer
satisfying the provisions of this subsection (c), the Depositary shall be
entitled to rely on the opinion or advice of the Voting Trustee or its own
counsel, as well as the factual representations of the Shareholder seeking
the release of the Deposited Shares. As used herein, the term "Permitted
Encumbrance" means, collectively, any mortgage, pledge, charge,
hypothecation or other encumbrance granted on Deposited Shares, other than
Optioned Shares (as defined in the Option Agreement), to a bank or other
bona fide financial institution as collateral security for bone fide
indebtedness incurred by the owner of such shares.
(d) Except in connection with a Permitted Transfer, each Shareholder
hereby agrees not to Transfer the Deposited Shares without the prior
written consent of the Investor. Other than with the prior written consent
of the Investor or in connection with a Permitted Transfer, any attempt to
Transfer Deposited Shares shall be null and void, and none of the
Corporation, the Depositary or the Voting Trustee shall recognize any such
Transfer.
(e) Each Shareholder acknowledges and agrees that he shall have no
right to the delivery of and the Depositary shall have no obligation to
deliver certificates for the Deposited Shares represented by the Voting
Trust Certificates held by such Shareholder except in accordance with the
provisions of this Section 9.
10. TEMPORARY RELEASE OF DEPOSITED SHARES. The Investor may, in its sole
discretion and upon written notice to the Shareholder, irrevocably release
the Deposited Shares identified in such notice (the "Exempt Shares") for
the period of time (the "Exemption Period") set forth therein. Upon
receipt of such notice, the Shareholder shall surrender the Voting Trust
Certificates representing the Deposited Shares released by the Investor,
duly endorsed with signatures guaranteed by a Canadian chartered bank, to
the Depositary at the principal office of the Depositary in the City of
Toronto, and receive from the Depositary a certificate or certificates
representing such Deposited Shares registered to the order of the
Shareholder and a Voting Trust Certificate representing the number of
Deposited Shares, if any, which shall remain as Deposited Shares.
Deposited Shares released pursuant to this Section 10 shall not be subject
to the terms of the Voting Agreement during the Exemption Period and the
Shareholder shall be entitled to vote all such shares during the Exemption
Period in such Shareholder's sole discretion. The Shareholder, unless
otherwise directed by the Investor, shall take all such action as shall be
necessary to cause such Exempt Shares to become subject to the terms of
this Agreement by depositing all such shares with the Depositary at the end
of the Exemption Period. All Deposited Shares released hereunder shall
continue to be subject to the transfer restrictions contained herein.
11. ALLOCATION OF VOTING RIGHTS.
(a) The Investor will in no event have the right to cast votes with
respect to Non-Investor Shares to the extent that the sum of the number of
votes that the Investor has a right to vote with respect to (i) Investor
Shares and (ii) Non-Investor Shares exceeds 50% of the total number of
votes which can be cast by all Voting Securities. For purposes of this
provision, this restriction shall apply first to the Investor's right to
vote Common Shares attributable to Outstanding Options held by the
Shareholders pursuant to this Agreement and the Voting Agreement on a pro
rata basis and then to any Common Shares (other than Investor Shares) held
by the Shareholders on a pro rata basis.
(b) To the extent that the Investor is precluded from exercising
voting rights with respect to Common Shares outstanding pursuant to Section
11(a), voting rights with respect to such Common Shares outstanding (the
"Additional Voting Rights") shall be allocated to Xxxxxx provided that
Xxxxxx shall not have a right to cast votes that would cause such
Additional Voting Rights, when aggregated with any other voting rights
owned by Xxxxxx, to equal or exceed 10% of the total number of votes which
can be cast by all Voting Securities (assuming for such purposes that all
Outstanding Options are converted to Common Shares if Xxxxxx would have the
right to vote such Common Shares), in which case another party designated
by mutual agreement between the Shareholders and the Investor shall have
the right to cast the Additional Voting Rights.
(c) Xxxxxx shall be entitled to exercise the Additional Voting Rights
on all matters presented to the shareholders of the Corporation for voting
in his sole discretion. Further, Xxxxxx shall be permitted to designate a
substitute party to exercise the Additional Voting Rights, provided that
the Investor consents and such consent is consistent with the terms of the
Boston Agreement.
(d) The provisions of this Section 11 shall expire if the sum of the
Investor Shares and the Boston Shares exceeds more than 50% of all
outstanding Voting Securities or the Corporation otherwise becomes a
controlled foreign corporation ("CFC") for U.S. federal income tax
purposes.
(e) Each of the Shareholders and the Investor hereby covenants and
agrees to cooperate with each other with respect to compliance with the
provisions of this Section 11 and to report to each other any information
affecting such compliance. Further, each of the Shareholders and the
Investor hereby covenants and agrees to implement a strategy to prevent the
voting rights of any person other than the Investor to equal or exceed 10%
of the total number of votes which can be cast by all Voting Securities
(assuming for such purposes that all Outstanding Options are converted to
Common Shares if such person would have the right to vote such Common
Shares).
(f) For purposes of this Section 11 only, the term "Voting
Securities" means all Common Shares and any other voting securities of the
Corporation.
(g) For purposes of this Section 11 only, the term "Outstanding
Options" means all outstanding options, warrants and convertible debentures
of the Corporation that may be converted to Common Shares.
(h) For purposes of this Section 11 only, the term "Investor Shares"
means all Voting Securities owned by the Investor directly, indirectly, or
by attribution, assuming for such purposes that all Outstanding Options are
converted to Common Shares if such Common Shares would be considered to be
Investor Shares pursuant to this provision.
(i) For purposes of this Section 11 only, the term "Non-Investor
Shares" means all Voting Securities other than Investor Shares that
Investor has a right to vote pursuant to this Agreement, the Voting
Agreement, the Boston Agreement or otherwise, assuming for such purposes
that all Outstanding Options are converted to Common Shares if such Common
Shares would be considered to be Non-Investor Shares pursuant to this
provision.
(j) For purposes of this Section 11 only, the term "Boston Agreement"
means the Voting, Right of First Offer and Waiver Agreement, dated as of
June __, 1998, between the Investor, Xxxxxx X. Xxx Equity Partners, L.P.
("THL"), and THL-CCI Limited Partnership ("THL-CCI").
(k) For purposes of this Section 11 only, the term "Boston Shares"
means all Voting Securities owned by THL and THL-CCI directly, indirectly,
or by attribution, assuming for such purposes that all Outstanding Options
are converted to Common Shares if such Common Shares would be considered to
be Boston Shares pursuant to this provision.
12. VOTING TRUSTEE. During the term of this Agreement, unless otherwise
agreed in writing between the parties hereto, there shall only be one
Voting Trustee hereunder and the Investor shall be the only entity
authorized to serve as Voting Trustee.
13. ISSUE OF REPLACEMENT VOTING TRUST CERTIFICATES. If any Voting Trust
Certificate issued hereunder shall become mutilated or be lost, destroyed
or stolen, the Depositary, upon receipt of written instructions from the
Voting Trustee, may issue and deliver in exchange for and upon cancellation
of such mutilated Voting Trust Certificate or in lieu of the Voting Trust
Certificate so lost, destroyed or stolen, a new Voting Trust Certificate
representing the same number of Common Shares of the Corporation upon, in
case of loss, destruction or theft, the production of such evidence thereof
and the receipt of an indemnity in the form of an open penalty bond issued
by a surety company licensed to transact business in the province of
Ontario and compliance with such reasonable regulations as the Depositary
may from time to time deem proper in the circumstances.
14. PROTECTION OF VOTING TRUSTEE. By way of supplement to the provisions
of law or of any statute for the time being in effect relating to
trustees, it is agreed that:
(i) neither the Voting Trustee nor the Investor shall incur any
liability or responsibility by reason of any error of law or
mistake or any matter or thing done or omitted to be done
under or in relation to this Agreement, except for his or
its own individual wilful and wrongful neglect or default;
and
(ii) the Voting Trustee may, in relation to this Agreement, act
on the opinion or advice of or opinion obtained from any
lawyer, broker or other expert and shall not be responsible
for any loss occasioned by so acting, and shall incur no
liability or responsibility for deciding in good faith not
to act upon any such opinion or advice.
15. PROTECTION OF DEPOSITARY.
(a) Except for its gross negligence or wilful misconduct, the
Depositary shall not be liable for any act done or step taken or omitted by
it in good faith, or for any mistake of fact or law and the Corporation
agrees to indemnify and save harmless the Depositary from and against all
claims, demands, actions, suits or other proceedings by whomsoever made,
prosecuted or brought and from all losses, costs, damages and expenses in
any manner based upon, occasioned by or attributable to any act of the
Depositary (other than acts of gross negligence or wilful misconduct on the
part of the Depositary) in the execution of its duties hereunder.
(b) The Depositary shall retain the right not to act and shall not be
held liable for refusing to act unless it has received clear documentation
which complies with the terms of this Agreement. Such documentation must
not require the exercise of any discretion or independent judgement. The
Depositary shall be protected in acting upon any written notice, request,
waiver, consent, certificate, receipt, statutory declaration or other paper
or document furnished to it, not only as to its due execution and the
validity and the effectiveness of its provisions but also as to the truth
and acceptability of any information therein contained which it in good
faith beehives to be genuine as to what it purports to be.
(c) In the event of any disagreement arising regarding the terms of
this Agreement, the Depositary shall be entitled at its option to refuse to
comply with any or all demands whatsoever until the dispute is settled
either by written agreement amongst the various parties or by a court of
competent jurisdiction.
(d) The Depositary shall have the right to consult with and obtain
advice from legal counsel appointed by it, who may but need not be legal
counsel for the other parties, in the event of any questions as to any of
the provisions hereof or its duties hereunder and it shall incur no
liability and it shall be fully protected in acting or not acting in good
faith in accordance with any opinion or instruction of such counsel. The
cost of such services shall be added to and be part of the Depositary fee
hereunder.
(e) The Depositary may employ such experts, advisers, agents or
agencies as it may reasonably require for the purpose of discharging its
duties hereunder and the reasonable costs incurred by the Depositary for
services provided by such experts, advisers, agents or agencies shall be
added to and be part of the Depositary fee hereunder.
(f) The Depositary shall not be liable for the delivery or non-
delivery of any certificate or certificates properly packaged for delivery
that has been placed in the mails or sent by courier.
(g) The Corporation will pay to the Depositary from time to time
remuneration for its services hereunder and will pay or reimburse the
Depositary, upon its request, for all reasonable expenses and disbursements
incurred or made by the Depositary in the administration of its services
and duties created hereby (including the reasonable fees and disbursements
of its counsel and all other advisers and assistants not regularly in its
employ). Any amount due under this Section and unpaid 30 days after
request for such payment, will bear interest from the expiration of such 30
days at a rate per annum equal to the then current interest rate charged by
the Depositary for overdue balances, as stated on the invoice issued by the
Depositary evidencing the amount owed, which shall be payable on demand.
The current interest rate for overdue balances charged by the Depositary is
1.20% per month. The Corporation will be advised in writing by the
Depositary at least 30 days prior to the implementation of any increase in
the invoice rate for overdue balances.
16. CHANGE OF COMMON SHARES. The parties hereto agree that the provisions
of this Agreement relating to the Deposited Shares shall apply, mutatis
mutandis, to any shares or securities into which such Deposited Shares may
be converted, changed, reclassified, redivided, redisignated, subdivided or
consolidated, to any shares or securities which are received by the
Depositary as the registered holder of the Deposited Shares as a stock
dividend or distribution payable in shares or securities of the Corporation
which entitle the holder thereof to vote at any meeting of the shareholders
of the Corporation and to any shares or securities of the Corporation or of
any successor or continuing company or corporation to the Corporation which
may be received by the Depositary as the registered holder of the Deposited
Shares on a reorganization, amalgamation, consolidation or merger,
statutory or otherwise.
17. AMENDMENTS; RELEASE OF COMMON SHARES. This Agreement may be amended
only with the written approval of the Voting Trustee, the Depositary, the
Investor and each of the Shareholders. Each Shareholder covenants and
agrees that the Deposited Shares shall not be released by the Depositary
except on termination of this Agreement or otherwise in accordance with the
terms hereof and that he will not request nor be entitled to the release of
his Deposited Shares by the Depositary except on such basis.
18. WARRANTY. Each of the parties hereto represents, warrants and agrees
that he is free to enter into this Agreement and is not subject to any
obligations or agreements which will or might prevent or interfere with the
performance of his obligations hereunder. Each of the parties hereto
further represents and warrants and acknowledges and agrees that he has had
the opportunity to seek, and was not prevented or discouraged from seeking,
independent legal advice prior to the execution and delivery of this
Agreement and that, in the event that he did not avail himself of that
opportunity prior to signing this Agreement, he did so voluntarily without
any undue duress or pressure and agrees that this failure to obtain legal
advice shall not be used by him as a defense as to the enforcement of his
obligations under this Agreement.
19. DEPOSITARY'S RESIGNATION. The Depositary shall have the right to
resign form its duties and obligations hereunder upon giving to each of the
Corporation, the Shareholders and the Investor (collectively, the
"Transaction Parties") no less than sixty (60) days prior written notice,
or such shorter notice as the Transaction Parties accept as sufficient.
The Corporation, upon receipt of prior written consent from the Voting
Trustee, shall have the power, at any time on thirty (30) days written
notice, to remove the existing Depositary and appoint a new Depositary. In
the event of the Depositary resigning or being removed as aforesaid, each
of the parties hereto shall take such action as shall be necessary to cause
the transfer of all funds, certificates, agreements and other documents
then in the possession of the retiring Depositary over to the new
Depositary, provided that the retiring Depositary shall have received
payment in full of all fees and expenses owing to it hereunder. Any new
Depositary appointed under any provision of this section shall be a
corporation authorized to carry on the business of a Depositary in the
Province of Ontario and shall be subject to removal as aforesaid. On any
such appointment, the new Depositary shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named
herein as the Depositary, without any further assurance, conveyance, act or
deed; but there shall be immediately executed, at the expense of the
Corporation, all such conveyances or other instruments as may, in the
opinion of counsel, be necessary or advisable for the purpose of assuring
the new Depositary a full estate in the premises. Should the Transaction
Parties fail to appoint a new Depositary as outlined above, then the
retiring Depositary shall cease its functions at the expiration of the
period of notice and may retain all and any property in its possession
hereunder on a merely safekeeping basis, at a fee to be determined solely
by the Depositary.
20. SHAREHOLDER CORRESPONDENCE. Each registered holder of a Voting Trust
Certificate shall be entitled to receive all notices, financial statements
(interim or otherwise), annual reports and other documents or mailings
distributed to the holders of Common Shares by the Corporation, except
proxies or any other instruments relating to the voting of Deposited
Shares, and, as soon as practicable following receipt of any such
documents, the Depositary shall deliver the same to such registered holder.
21. SUBSTITUTION OF SHARES. Upon exercise by the Investor of its right to
purchase Optioned Shares pursuant to the Option Agreement, each of Xxxxxxxx
and Xxxxxxxxx, to the extent they own Optioned Shares subject to such
exercise, shall be entitled to substitute other Common Shares beneficially
owned by them in place of the Optioned Shares provided that such
replacement shares are delivered to the Investor within five (5) days after
receipt of notice of the Investor's intention to exercise its option with
respect to such Optioned Shares.
22. NOTICE. All notices, requests, demands and other communications shall
be in writing and shall be deemed to have been duly given if personally
delivered or sent by United States or Canadian mails or by telegram or
telex confirmed by letter, or by facsimile transmission, receipt confirmed,
to the address set forth below:
(i) in the case of Drabinsky:
Livent Inc.
000 Xxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Fax No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxxx
(ii) in the case of Xxxxxxxx:
Livent Inc.
000 Xxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Fax No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxx
(iii) in the case of Xxxxxx:
c/o Schulte, Xxxx & Xxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
X.X.X.
Fax No.: (000) 000-0000
Attention: Xxxxxx Xxxxxx
(iv) in the case of Xxxxxx:
Lynx Ventures L.P.
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
X.X.X.
Fax No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx
(v) in the case of the Investor:
Lynx Ventures L.P.
c/x Xxxxxx, Xxxxxxx & Associates
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
U.S.A.
Fax: 000-000-0000
Attention: Xxxxxxx Xxxxxx
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
U.S.A.
Fax No.: (000) 000-0000
Attention: Xxxx X. Xxxxxxx
with a courtesy copy to:
Xxxxxx, Xxxxxx & Xxxxx
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
U.S.A.
Fax No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxx
(vi) in the case of the Depositary:
Montreal Trust Company of Canada
000 Xxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Fax No.: (000) 000-0000
Attention: Manager, Corporate Trust Department
(vii) in the case of the Corporation:
Livent Inc.
000 Xxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx
Xxxxxx X0X 0X0
Fax No.: (000) 000-0000
Attention: The Secretary
All notices requiring timely attention shall be sent by facsimile
transmission, telex or overnight mail. Any notice shall be deemed
received, unless earlier received, (a) if sent by certified or registered
mail, return receipt requested, when actually received, (b) if sent by
overnight mail, on the next Business Day, (c) if sent by telegram or telex,
on the date sent, and (d) if sent by facsimile transmission or delivered by
hand, on the date of receipt. Any party may change its address for service
from time to time by notice given in accordance with the foregoing
provisions.
23. GOVERNING LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY
AND INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE DOMESTIC LAWS OF THE PROVINCE OF ONTARIO AND THE
FEDERAL LAWS OF CANADA APPLICABLE THEREIN, WITHOUT GIVING EFFECT TO ANY
CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE PROVINCE
OF ONTARIO OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF
THE LAWS OF ANY JURISDICTION OTHER THAN THE PROVINCE OF ONTARIO AND THE
FEDERAL LAWS OF CANADA APPLICABLE THEREIN.
24. SEVERABILITY. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstances, is held
invalid, illegal or unenforceable in any respect for any reason, the
parties shall negotiate in good faith with a view to the substitution
therefor of a suitable and equitable solution in order to carry out, so far
as may be valid and enforceable, the intent and purpose of such invalid
provision, provided, however, that the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be in any way impaired
thereby, it being intended that all of the rights and privileges of the
parties hereto shall be enforceable to the fullest extent permitted by law.
25. ASSIGNMENT. This Agreement may not be assigned by a party hereto
without the prior written consent of the other parties hereto.
26. SUCCESSORS. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective successors, permitted
assigns, heirs, administrators, executors and legal personal
representatives.
27. NUMBER AND GENDER. Words importing the singular number only shall
include the plural and vice versa, words importing the masculine gender
shall include the feminine and neuter genders and vice versa and words
importing persons shall include individuals, partnerships, associations,
trusts, unincorporated organizations and corporations and vice versa.
28. CANADIAN FUNDS. Except as otherwise expressly indicated herein, all
dollar amounts referred to in his agreement are in Canadian funds.
29. CHOICE OF LANGUAGE. The parties hereby acknowledge that they have
expressly required this Agreement and all notices, statements of account
and other documents required or permitted to be given or entered into
pursuant hereto to be drawn up in the English language. Les parties
reconnaissent avoir expressEment demandEes que la prEsente Convention ainsi
que tout avis, tout Etat de compte et tout autre document A tre ou pouvant
xxx xxxxX ou conclu en vertu des dispositions des prEsentes, soient
rEdigEs en langue anglaise seulement.
30. ENTIRE AGREEMENT. This Agreement, including the Schedules hereto,
constitutes the entire agreement between the parties with respect to the
subject matter hereof. There are no conditions, covenants, agreements,
representations, warranties or other provisions, express or implied,
collateral, statutory or otherwise, relating to the subject matter hereof,
except as provided herein. No amendment, waiver or termination of this
Agreement shall be binding on a party hereto unless consented to in writing
by such party.
31. DUTIES ONLY AS SET FORTH. The duties and obligations of the
Depositary shall be determined solely by the provisions hereof and,
accordingly, the Depositary shall not be responsible except for the
performance of such duties and obligations as it has undertaken herein.
The Depositary shall not be bound by any notice of a claim or demand with
respect to, or any waiver, modification, amendment, termination or
rescission of this Agreement, unless received by it in writing, and signed
by the parties hereto and, if its duties are herein affected, unless it
shall have given its prior written consent thereto.
32. TIME OF THE ESSENCE. Time shall be the essence of this Agreement.
33. FURTHER ASSURANCES. Each of the parties to this Agreement shall do
all such acts and things and shall execute and deliver, or cause to be
executed and delivered, all such documents, instruments and agreements as
may be necessary or desirable to give effect to the provisions of and the
intent of this Agreement.
34. NO INCONSISTENT ARRANGEMENTS. Each of the parties hereby covenants
and agrees that, except as expressly provided in this Agreement, it shall
not take any action that would in any way restrict, limit or interfere with
the performance of its obligations hereunder or the transactions
contemplated hereby.
35. COUNTERPARTS. This Agreement may be executed in several counterparts,
each of which, when executed by a party hereto, shall be deemed to be an
original and such counterparts shall together constitute one and the same
instrument.
IN WITNESS WHEREOF the parties hereto have hereunto set their
corporate seals and hands and seals.
/s/ Xxxxx X. Xxxxxxxxx /s/ Xxxxx X. Xxxxxxxx
---------------------------- ---------------------------
Xxxxx X. Xxxxxxxxx Xxxxx X. Xxxxxxxx
/s/ Xxx X. Xxxxxx /s/ Xxxxx X. Xxxxxx
---------------------------- ---------------------------
Xxx X. Xxxxxx Xxxxx X. Xxxxxx
LYNX VENTURES L.P.
By: Lynx Ventures L.L.C.,
its General Partner
By /s/ Xxxxxxx X. Xxxxx
-------------------------
Name: Xxxxxxx X. Xxxxx
Title: Managing Member
LIVENT INC.
By /s/ Xxxxx X. Xxxxxxxxx
--------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Chairman and
Chief Executive Officer
MONTREAL TRUST COMPANY
OF CANADA
By /s/ Xxxxxx X. Xxxx By /s/ Xxxxxx Xxxxxxxxx
--------------------------- ---------------------
Name: Xxxxxx X. Xxxx Name: Xxxxxx Xxxxxxxxx
Title: Senior Corporate Trust Title: Manager
Officer
SCHEDULE A*
Shareholder Common Shares
Xxxxx X. Xxxxxxxxx 0
Xxxxx X. Xxxxxxxx 1,500,000
Xxx X. Xxxxxx 350,000
Xxxxx X. Xxxxxx 0
* This schedule may be updated from time to time to reflect
additional shares pursuant to the terms of the Agreement.
SCHEDULE B
NO. SHARES
VOTING TRUST CERTIFICATE
IN RESPECT OF
COMMON SHARES OF LIVENT INC.
THIS IS TO CERTIFY that, upon the termination of the Voting Trust
Agreement hereinafter mentioned or otherwise in accordance with the
provisions of such Voting Trust Agreement, and on surrender of this Voting
Trust Certificate, duly endorsed with signatures guaranteed by a Canadian
chartered bank, to the undersigned Depositary at its principal office in
the City of Toronto, _________________ will be entitled, upon and subject
to the terms and provisions of the voting trust agreement (the "Voting
Trust Agreement") made the 12th day of June, 1998 among Xxxxx X. Xxxxxxxxx,
Xxxxx X. Xxxxxxxx, Xxx X. Xxxxxx, Xxxxx X. Xxxxxx, Lynx Ventures L.P.,
Livent Inc., a corporation incorporated under the laws of the Province of
Ontario (the "Corporation") and the undersigned Depositary, to receive out
of the common shares in the capital of the Corporation, deposited with the
undersigned Depositary under the Voting Trust Agreement, a certificate or
certificates for _____________ common shares of the Corporation and in the
meantime to receive payments, of the amounts of the dividend or
distribution payments, if any, received in cash or by cheque by the
Depositary upon said common shares of the Corporation, subject however to
the terms and provisions of the Voting Trust Agreement applicable to the
payment of such cash dividends and distributions.
No voting right passes by or under this Voting Trust Certificate
or by or under any agreement expressed or implied and, until the actual
delivery of such share certificate(s) for common shares of the Corporation
as aforesaid to the registered holder hereof, the Voting Trustee (as
defined in the Voting Trust Agreement) shall, in respect thereof,
exclusively possess and be entitled to exercise all the rights of voting
and of taking part in the consenting to any corporate or shareholders'
action appertaining to the common shares of the Corporation deposited with
the undersigned Depositary, in accordance with the terms of the Voting
Trust Agreement.
This Voting Trust Certificate is issued pursuant and subject to
the terms and conditions of the Voting Trust Agreement which, among other
things, establishes the rights of the holders of Voting Trust Certificates
issued pursuant to the Voting Trust Agreement and the rights, powers and
discretions of the Voting Trustee and of the Depositary.
The right to transfer, assign, dispose of or otherwise deal with
this Voting Trust Certificate is expressly subject to the terms, conditions
and restrictions contained in the Voting Trust Agreement ( an original
counterpart of which is on file at the principal Toronto office of the
Depositary), and no transfer, assignment, disposition or other dealing with
this Voting Trust Certificate is valid for any purpose whatsoever, unless
made in accordance with and subject to the terms, conditions and
restrictions of the Voting Trust Agreement. This Voting Trust Certificate
is transferable only, subject to compliance with such terms, conditions and
restrictions on transfer, on the books of the Depositary maintained by the
Depositary at its principal Toronto office on surrender hereof, properly
endorsed for transfer by the registered holder hereof in person or by
attorney duly authorized, and, until completion of the due transfer hereof
on the said books in accordance with and subject to the terms, conditions
and restrictions contained in the Voting Trust Agreement, the Voting
Trustee and the Depositary shall be required at all times to treat and
consider the holder of record hereof on said books as the holder hereof for
all purposes.
IN WITNESS WHEREOF, MONTREAL TRUST COMPANY OF CANADA has caused
this Certificate to be signed by its duly authorized officer and to be
issued at its principal office in the City of Toronto this ___ day of
__________.
MONTREAL TRUST COMPANY
OF CANADA
By_____________________________
Name:
Title:
FORM OF TRANSFER
(to be set out on the back of Voting Trust Certificate)
FOR VALUE RECEIVED, ___________ hereby sells, assigns and
transfers unto _____________ the within Voting Trust Certificate and all
right, title and interest in the common shares in the capital of Livent
Inc. represented thereby, and hereby irrevocably constitutes and
appoints____________ attorney to transfer the said certificate on the books
of the within named Depositary with full power of substitution in the
premises.
Dated:
In the presences of:
(signature of witness) (signature of registered holder)
