THE THOMSON CORPORATION
(AN ONTARIO CORPORATION)
38,000,000 Common Shares
PURCHASE AGREEMENT
June 11, 2002
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxx Xxxxxxx & Co. Incorporated
as Representatives of the several Underwriters
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The Thomson Corporation, an Ontario corporation (the "Company"), The
Woodbridge Company Limited, an Ontario corporation ("Woodbridge") and 986269
Alberta Limited, an Alberta corporation and a wholly-owned subsidiary of
Woodbridge ("986269" and together with Woodbridge, the "Selling Shareholder"),
confirm their respective agreements with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx"), Xxxxxx Xxxxxxx & Co.,
Incorporated ("Xxxxxx Xxxxxxx") and each of the other Underwriters named in
Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Xxxxxxx Xxxxx and Xxxxxx Xxxxxxx are acting as representatives
(in such capacity, the "Representatives"), with respect to (i) the sale by the
Company and the Selling Shareholder, acting severally and not jointly, and the
purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of common shares of the Company ("Common Shares") set forth
in Schedule B hereto and (ii) the grant by the Selling Shareholder to the
Underwriters of the option described in Section 2(b) hereof to purchase all or
any part of 5,700,000 additional common shares to cover over-allotments, if any.
The aforesaid 38,000,000 common shares (the "Initial Securities") to be
purchased by the Underwriters and all or any part of the 5,700,000 common shares
subject to the option described in Section 2(b) hereof (the "Option Securities")
are hereinafter called, collectively, the "Securities".
The Company and the Selling Shareholder understand that the
Underwriters propose to make a public offering of the Securities in all the
provinces of Canada and in the
United States upon the terms set forth in the Canadian Prospectus (as defined
below) and the U.S. Prospectus (as defined below) as soon as the Representatives
deem advisable after this Agreement has been executed and delivered.
The Company, the Selling Shareholder and the Underwriters agree that
up to 2,000,000 shares of the Securities to be purchased by the Underwriters
(the "Reserved Securities") shall be reserved for sale by the Underwriters to
certain eligible employees of the Company as part of the distribution of the
Securities by the Underwriters, subject to the terms of this Agreement, the
applicable rules, regulations and interpretations of the National Association of
Securities Dealers, Inc. (the "NASD") and all other applicable laws, rules and
regulations. The Company and the Underwriters further agree that any Reserved
Securities sold to eligible employees in the United Kingdom shall consist of
Securities sold to the Underwriters by the Company pursuant to this Agreement.
To the extent that such Reserved Securities are not orally confirmed for
purchase by such eligible employees by the end of the first business day after
the date of this Agreement, such Reserved Securities may be offered to the
public as part of the public offering contemplated hereby.
The Company has prepared and filed with the securities regulatory
authorities (the "Qualifying Authorities") in each province of Canada (the
"Qualifying Provinces") a preliminary short form base PREP prospectus, including
the documents incorporated by reference, dated May 2, 2002 relating to the
Securities (in the English and French languages, as applicable, the "Canadian
Preliminary Prospectus"). The Ontario Securities Commission has been assigned to
the Company (the "Reviewing Authority") as its principal regulator in respect of
the offering of the Securities and the Canadian Preliminary Prospectus has been
filed with the Qualifying Authorities pursuant to National Instrument
44-101-Short Form Prospectus Distributions, National Policy 43-201-Mutual
Reliance Review System for Prospectuses and Annual Information Forms and
National Instrument 44-103-Post Receipt Pricing (the "PREP Procedures"). The
Company has received from the Reviewing Authority a decision document issued
under the Mutual Reliance Review System pursuant to National Policy 43-201 (an
"MRRS Decision Document") dated May 2, 2002 evidencing receipts for the Canadian
Preliminary Prospectus issued by each Qualifying Authority. The Company has also
prepared and filed pursuant to a multi-jurisdictional disclosure system with the
United States Securities and Exchange Commission (the "Commission") a
registration statement on Form F-10 (File No. 333-87412) covering the
registration of the Securities under the United States Securities Act of 1933,
as amended, and the applicable rules and regulations thereunder adopted by the
Commission (the "1933 Act"), including the Canadian Preliminary Prospectus (with
such deletions therefrom and additions thereto as are permitted or required by
Form F-10 and the applicable rules and regulations of the Commission) (the "U.S.
Preliminary Prospectus").
The Company has also prepared and filed (1) with the Qualifying
Authorities, an amended and restated preliminary short form base PREP
prospectus, including the documents incorporated by reference, dated May 16,
2002 relating to the Securities (in the English and French languages, as
applicable, the "Canadian Amended Preliminary Prospectus") and has obtained an
MRRS Decision Document dated May 17, 2002 from the Reviewing Authority
evidencing the issuance by each of the Qualifying Authorities of receipts for
the Canadian Amended Preliminary Prospectus and (2) with the Commission, an
amendment to the registration statement on Form F-10 (File No. 333-87412),
including the Canadian Amended
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Preliminary Prospectus in the English language (with such deletions therefrom
and additions thereto as are permitted or required by Form F-10 and the
applicable rules and regulations of the Commission)(the "U.S. Amended
Preliminary Prospectus").
The Company (A) has also prepared and filed (1) with the Qualifying
Authorities, a final short form base PREP prospectus relating to the Securities
(in the English and French languages, as applicable, the "Final PREP
Prospectus") omitting only the PREP Information (as defined below) in accordance
with the rules and procedures established pursuant to the PREP Procedures and
has obtained an MRRS Decision Document dated June 11, 2002 from the Reviewing
Authority evidencing the issuance by each of the Qualifying Authorities of
receipts for the Final PREP Prospectus and (2) with the Commission, an amendment
to the registration statement on Form F-10 (File No. 333-87412), including the
Final PREP Prospectus in the English language (with such deletions therefrom and
additions thereto as are permitted or required by Form F-10 and the applicable
rules and regulations of the Commission) omitting the PREP Information, which
registration statement has become effective, and (B) will prepare and file,
promptly after the execution and delivery of this Agreement, and, in any event,
within two business days of this Agreement (1) with the Qualifying Authorities,
in accordance with the PREP Procedures, a supplemented prospectus setting forth
the PREP Information (in the English and French languages, as applicable, the
"Supplemented PREP Prospectus") and (2) with the Commission, in accordance with
General Instruction II.L. of Form F-10, the Supplemented PREP Prospectus (with
such deletions therefrom and additions thereto as are permitted or required by
Form F-10 and the applicable rules and regulations of the Commission) (the "U.S.
Supplemented Prospectus"). The information, if any, included in the Supplemented
PREP Prospectus that is omitted from the Final PREP Prospectus for which an MRRS
Decision Document has been obtained from the Reviewing Authority but that is
deemed under the PREP Procedures to be incorporated by reference into the Final
PREP Prospectus as of the date of the Supplemented PREP Prospectus is referred
to herein as the "PREP Information".
Each prospectus relating to the Securities (A) used in the United
States (1) before the time such registration statement on Form F-10 became
effective or (2) after such effectiveness and prior to the execution and
delivery of this Agreement or (B) used in Canada (1) before an MRRS Decision
Document for the Final PREP Prospectus had been obtained from the Reviewing
Authority on behalf of itself and the Qualifying Authorities or (2) after such
MRRS Decision Document had been obtained and prior to the execution and delivery
of this Agreement, in each case, including the documents incorporated by
reference therein, that omits the PREP Information, is herein called a
"preliminary prospectus". Such registration statement on Form F-10, including
the exhibits thereto and the documents incorporated by reference therein, as
amended at the time it became effective and including the PREP Information, is
herein called the "Registration Statement". The Final PREP Prospectus for which
an MRRS Decision Document has been issued by the Reviewing Authority on behalf
of each Qualifying Authority, including the documents incorporated by reference
therein, is herein referred to as the "Canadian Prospectus", except that, if,
after the execution of this Agreement, a Supplemented PREP Prospectus containing
the PREP Information is thereafter filed with the Qualifying Authorities, the
term "Canadian Prospectus" shall refer to such Supplemented PREP Prospectus,
including the documents incorporated by reference therein.
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All applicable securities laws in each of the Qualifying Provinces
and the respective rules and regulations made thereunder together with all
applicable policy statements, blanket orders or rulings, notices and instruments
are hereinafter called the "Canadian Securities Laws".
Any reference herein to the "U.S. Prospectus" shall mean either the
prospectus included in the Registration Statement at the time it has become
effective under the 1933 Act, or, the U.S. Supplemented Prospectus containing
the PREP Information furnished to the Underwriters after execution of this
Agreement (whether or not such prospectus is required to be filed pursuant to
the applicable rules and regulations of the Commission under the 1933 Act), if
such U.S. Supplemented Prospectus is furnished to the Underwriters after
execution of this Agreement.
Any reference herein to the Canadian Preliminary Prospectus, the
Canadian Amended Preliminary Prospectus, the Final PREP Prospectus, the
Supplemented PREP Prospectus or the Canadian Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to
Canadian Securities Laws; any reference herein to the Registration Statement,
the U.S. Preliminary Prospectus, the U.S. Amended Preliminary Prospectus, the
U.S. Supplemented Prospectus or the U.S. Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to Item 4
of Form F-10 which were filed under the United States Securities Exchange Act of
1934, as amended, and the rules and regulations adopted thereunder (the
"Exchange Act") on or before the Effective Date of the Registration Statement or
the date of the U.S. Preliminary Prospectus, the U.S. Amended Preliminary
Prospectus, the U.S. Supplemented Prospectus or the U.S. Prospectus, as the case
may be; and any reference herein to the terms "amend", "amendment" or
"supplement" with respect to any of the foregoing, as the case may be, shall be
deemed to refer to and include all documents deemed to be incorporated by
reference therein. Any amendment to the Canadian Prospectus, any amended or
supplemental prospectus or auxiliary material, information, evidence, return,
report, application, statement or document that may be filed by or on behalf of
the Company under Canadian Securities Laws prior to the Closing Time (as defined
herein) or, where such document is deemed to be incorporated by reference into
the Final PREP Prospectus, prior to the expiry of the period of distribution of
the Securities is hereinafter called, collectively, "Supplementary Material".
The Company has prepared and filed with the Commission an
appointment of agent for service of process upon the Company on Form F - X in
conjunction with the filing of the Registration Statement (the "Form F - X").
SECTION 1. Representations and Warranties.
(A) Representations and Warranties by the Company. The Company represents,
warrants and agrees with each Underwriter as of the date hereof, as of the
Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery
(if any) referred to in Section 2(b) hereof, as follows:
(a) Final Receipt; Effectiveness; No Stop Order.
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The Company meets the general eligibility requirements for use of a
short form prospectus under National Instrument 44-101 and for use of Form
F-10 under the 1933 Act and is eligible to use the PREP Procedures. An
MRRS Decision Document has been obtained from the Reviewing Authority
evidencing the issuance by the Qualifying Authorities of a receipt for
each of the Canadian Preliminary Prospectus, the Canadian Amended
Preliminary Prospectus and the Final PREP Prospectus and no order
suspending the distribution of the Securities has been issued by any
Qualifying Authority and no proceedings for that purpose are pending or
have been initiated or, to the best of the Company's knowledge, threatened
by any Qualifying Authority. The Registration Statement has become
effective; no stop order suspending the effectiveness of the Registration
Statement is in effect, and no proceedings for such purpose are pending
before or have been initiated or, to the best of the Company's knowledge,
threatened by the Commission.
(b) Compliance with U.S. and Canadian Securities Laws.
(A) Each document filed or to be filed with the Qualifying
Authorities and incorporated by reference in the Canadian Prospectus
complied or will comply when so filed in all material respects with the
requirements of the Canadian Securities Laws (including the PREP
Procedures) and such documents did not contain and will not contain, as of
its respective filing date, at the Closing Time and any Date of Delivery,
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, (B) at the time that the Reviewing Authority has issued an
MRRS Decision Document for the Final PREP Prospectus, no other document
with respect to the Final PREP Prospectus was required to be filed with
the Qualifying Authorities by or on behalf of the Company, except the
Supplemented PREP Prospectus, (C) the U.S. Prospectus conformed to the
Canadian Prospectus, except for such deletions therefrom and additions
thereto as are permitted or required by Form F-10 and the applicable rules
and regulations of the Commission, (D) the Form F-X and the Registration
Statement, and any amendments or supplements thereto, when the
Registration Statement became effective complied, and on the Closing Time,
and if any Option Securities are purchased, on the applicable Date of
Delivery, will comply in all material respects, with the applicable
requirements of the 1933 Act, (E) each document, if any, filed or to be
filed pursuant to the Exchange Act and incorporated by reference in the
U.S. Prospectus complied or will comply when so filed in all material
respects with the applicable requirements of the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (F) the
Registration Statement, when it became effective, did not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, (G) each of the Canadian Prospectus, the U.S. Prospectus
and any Supplementary Material, together with any amendment or supplement
did not contain and will not contain as of its date, at the Closing Time
and at any Date of Delivery any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
and (H) in connection with the offer and sale of the Reserved Securities,
each of the Canadian Prospectus, the U.S. Prospectus, any Canadian
Preliminary Prospectus,
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any Canadian Amended Preliminary Prospectus, any U.S. Preliminary
Prospectus, any Amended U.S. Preliminary Prospectus and any Supplementary
Material or prospectus wrapper, if any, prepared in connection therewith,
at their respective times of filing, at the Closing Time and at any Date
of Delivery, complied and will comply in all material respects with any
applicable laws or regulations of foreign jurisdictions in which the
Canadian Prospectus or the U.S. Prospectus and each respective preliminary
prospectus, as amended or supplemented, if applicable, are distributed in
connection with the offer and sale of Reserved Securities; except that the
representations and warranties set forth in this Section 1(A)(b) do not
apply to statements or omissions in the Registration Statement, the U.S.
Prospectus or the Canadian Prospectus or any Supplementary Materials,
together with any amendment or supplement, based upon information relating
to any Underwriters furnished to the Company in writing by or on behalf of
any Underwriter through the Representatives expressly for such use.
There are no contracts or documents which are required to be
described in the Canadian Prospectus or to be filed as exhibits to the
Registration Statement which have not been so described and filed as
required.
Additionally, there are no reports or information that in
accordance with the requirements of the Qualifying Authorities must be
made publicly available in connection with the offering of the Securities
that have not been made publicly available as required; there are no
documents, other than the Supplemented PREP Prospectus, required to be
filed with any Qualifying Authorities in connection with the Canadian
Prospectus that have not been filed as required.
Each copy of the Canadian Preliminary Prospectus, the Canadian
Amended Preliminary Prospectus, the Final PREP Prospectus and the
Supplemented PREP Prospectus provided to the Underwriters by the Company
was, or will be, identical to the version thereof filed electronically by
the Company with the Qualifying Authorities on the System for Electronic
Document Analysis and Retrieval. The U.S. Preliminary Prospectus, the
Amended U.S. Preliminary Prospectus and the U.S. Prospectus as originally
filed or as part of any amendment thereto, or filed pursuant to General
Instruction II.L. of Form F-10, complied when so filed in all material
respects with the applicable rules and regulations of the Commission under
the 1933 Act and each preliminary prospectus and the U.S. Prospectus
delivered to the Underwriters for use in connection with this offering was
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except as permitted by Regulation S-T.
(c) Financial Statements.
The consolidated financial statements included in the Registration
Statement, the U.S. Prospectus and the Canadian Prospectus, together with
the related schedules and notes, present fairly, in all material respects,
the consolidated financial position of the Company and its consolidated
subsidiaries at the dates indicated and the statement of operations,
shareholders' equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified; said consolidated financial
statements have been prepared in conformity with generally accepted
accounting principles in Canada, which have been
6
applied on a consistent basis throughout the periods involved (except as
otherwise specified in the notes thereto). The consolidated financial
statements for the years ended December 31, 1999, 2000 and 2001 and at
December 31, 2000 and 2001, and the unaudited consolidated financial
statements for the three months ended March 31, 2001 and 2002 have been
reconciled to U.S. generally accepted accounting principles, which have
been applied on a consistent basis throughout the periods involved (except
as otherwise specified in the notes thereto). Except for financial data
included in the Canadian Prospectus and the U.S. Prospectus under the
heading "Management's Discussion and Analysis of Financial Condition and
Results of Operations -- Outlook", the financial data included in the
Canadian Prospectus and the U.S. Prospectus under the headings "Summary of
Consolidated Financial and Operating Data", "Selected Consolidated
Financial and Operating Data", "Capitalization" and "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
fairly present in all material respects the information shown therein on
their respective dates and have been compiled on a basis consistent with
that of the audited or unaudited financial statements included in the
Registration Statement.
(d) No Material Adverse Change in Business.
Since the respective dates as of which information is given in the
Registration Statement, in the U.S. Prospectus and in the Canadian
Prospectus, except as otherwise stated therein (exclusive of amendments
and supplements thereto), there has been no material adverse change in the
business, affairs, results of operations, assets, liabilities (contingent
or otherwise) or capital of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business
(a "Material Adverse Effect").
(e) Good Standing of the Company and Subsidiaries.
The Company has been duly incorporated and is valid and subsisting
as a corporation under the laws of the Province of Ontario and has
corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the U.S. Prospectus and in the
Canadian Prospectus and to enter into and perform its obligations under
this Agreement.
Each material subsidiary of the Company as of the date hereof as
required to be disclosed in the annual information form of the Company
pursuant to Item 2.2 of Form 44-101F1 of National Instrument 44-101 under
Canadian Securities Laws is listed in Annex A hereto (each a "Subsidiary"
and, collectively, the "Subsidiaries") and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Canadian Prospectus and in the U.S.
Prospectus, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Canadian Prospectus and the U.S. Prospectus,
all of the issued and outstanding share capital of each such Subsidiary
has been duly authorized and validly issued, is fully paid and
non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity. Except as set forth in the
7
Canadian Prospectus and the U.S. Prospectus or as reflected in the audited
or unaudited consolidated financial statements of the Company included or
incorporated by reference in the Registration Statement and the Canadian
Prospectus and U.S. Prospectus, the Company does not have any interest in
or relationship with any special purpose vehicle or own, directly or
indirectly, any shares of stock or any other equity of any corporation or
have any equity or other ownership interest in any firm, partnership,
limited liability company, joint venture, association or other entity
which interest in or relationship with would have a Material Adverse
Effect on the Company.
(f) Capitalization.
The authorized, issued and outstanding share capital of the Company
is as set forth in the Canadian Prospectus and in the U.S. Prospectus in
the column entitled "Actual" under the caption "Capitalization" (except
for subsequent issuances, if any, pursuant to this Agreement, pursuant to
reservations, agreements or employee benefit plans or dividend
reinvestment plans or pursuant to the exercise of options referred to in
the Canadian Prospectus and in the U.S. Prospectus). The issued and
outstanding shares of the Company, including the Securities to be
purchased by the Underwriters from 986269, have been duly authorized and
validly issued and are fully paid and non-assessable; none of the
outstanding share capital of the Company, including the Securities to be
purchased by the Underwriters from 986269, was issued in violation of any
preemptive or other similar rights of any security holder of the Company.
(g) Due Authorization.
This Agreement has been duly authorized, executed and delivered by
the Company. The Securities to be purchased by the Underwriters from the
Company have been duly authorized for issuance and sale to the
Underwriters pursuant to this Agreement and, when issued and delivered by
the Company and against payment of the purchase price therefor as provided
in this Agreement, will be validly issued and fully paid and
non-assessable; the Securities conform in all material respects to the
respective statements relating thereto contained in the U.S. Prospectus
and in the Canadian Prospectus and no holder of the Securities will be
subject to personal liability by reason of being such a holder; and the
issuance of the Securities to be issued by the Company is not subject to
any preemptive or other similar rights of any security holder of the
Company.
(h) Absence of Defaults and Conflicts.
Neither the Company nor any of its subsidiaries is in violation of
its charter or by-laws or in default in the performance or observance of
any obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, license, lease or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which it or any of them may be
bound, or to which any of the property or assets of the Company or any
subsidiary is subject (collectively, "Agreements and Instruments") except
for such violations or defaults that are described in the Canadian
Prospectus (exclusive of any amendments or supplements
8
thereto) or the U.S. Prospectus (exclusive of any amendments or
supplements thereto) or that would not result in a Material Adverse
Effect; and the execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated herein and in the
Registration Statement (including the issuance and sale of the Securities
to be issued by the Company) and compliance by the Company with its
obligations hereunder have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of
notice or passage of time or both, conflict with or constitute a breach
of, or default or Repayment Event (as defined below) under, or result in
the creation or imposition of any tax, lien, charge or encumbrance upon
any property or assets of the Company or any subsidiary pursuant to, the
Agreements and Instruments (except for such Repayment Events or conflicts,
breaches or defaults or liens, charges or encumbrances that would not
result in a Material Adverse Effect), nor will such action result in any
violation of (i) the provisions of the charter or bylaws of the Company or
any subsidiary or (ii) any applicable treaty, law, statute, rule,
regulation, judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Company or any subsidiary or any of their assets, properties or
operations, except for such violations of clause (ii) that would not
result in a Material Adverse Effect. As used herein, a "Repayment Event"
means any event or condition which gives the holder of any note, debenture
or other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Company or any subsidiary.
(i) Absence of Further Requirements.
No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental
authority or agency is necessary or required for the performance by the
Company of its obligations hereunder, in connection with the offering,
issuance or sale of the Securities to be issued by the Company hereunder
or the consummation of the transactions contemplated by this Agreement,
except (i) such as have already been made or obtained or as may be
required under the 1933 Act, the Exchange Act or state securities laws or
Canadian Securities Laws and (ii) such as have been made or obtained under
the laws and regulations of jurisdictions outside Canada and the United
States in which the Reserved Securities are offered.
(j) Registration Rights.
There are no persons with registration rights or other similar
rights to have any securities registered or qualified for distribution
pursuant to the Registration Statement, the Canadian Prospectus or
otherwise registered by the Company under the 1933 Act or qualified for
distribution under any Canadian Securities Laws.
(B) Representations and Warranties by the Selling Shareholder. The Selling
Shareholder represents and warrants to each Underwriter as of the date hereof,
as of the Closing Time, and, if 986269 is selling Option Securities on a Date of
Delivery, as of each such Date of Delivery, and the Selling Shareholder agrees
with each Underwriter, as follows:
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(a) Accurate Disclosure.
To the best of the knowledge of the Selling Shareholder, the
representations and warranties of the Company contained in Section 1(a)
hereof are true and correct; the Selling Shareholder has reviewed and is
familiar with the Registration Statement and the Canadian Prospectus and
the U.S. Prospectus and at the time the Registration Statement became
effective under the 1933 Act and at all times subsequent thereto up to the
Closing Date (and if any Option Shares are purchased, at the applicable
Date of Delivery): (i) neither the Registration Statement nor any
amendment or supplement thereto contained or will contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading and (ii) each of the U.S. Prospectus, the Canadian Prospectus
or any amendment or supplement thereto constituted and will constitute
full, true and plain disclosure of all material facts relating to the
Securities and the Company and its subsidiaries, considered as one
enterprise, and each of the U.S. Prospectus, the Canadian Prospectus or
any amendment or supplement thereto or any Supplementary Material did not
contain and will not contain as of its respective date, at the Closing
Time and any Date of Delivery an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading; except that the representations and
warranties contained in clauses (i) and (ii) above do not apply to
statements or omissions made based on information relating to any
Underwriters furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for inclusion in the
Registration Statement, the U.S. Prospectus, the Canadian Prospectus or
any Supplementary Material (or any amendment or supplement thereto).
(b) Authorization of Agreements.
The Selling Shareholder has the corporate power and authority to
enter into this Agreement and 986269 has the corporate power to sell,
transfer and deliver the Securities to be sold by 986269 hereunder. The
execution and delivery of this Agreement and the sale and delivery of the
Securities to be sold by 986269 and the consummation of the transactions
contemplated herein and compliance by the Selling Shareholder with its
obligations hereunder have been duly authorized by the Selling Shareholder
and do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any lien, charge
or encumbrance upon the Securities to be sold by 986269 or any property or
assets of the Selling Shareholder pursuant to any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, license, lease or
other agreement or instrument to which the Selling Shareholder is a party
or by which the Selling Shareholder may be bound, or to which any of the
property or assets of the Selling Shareholder is subject except for
conflicts, breaches, defaults, liens, charges or encumbrances that would
not have a material adverse effect on the Selling Shareholder's ability to
consummate the transactions contemplated by this Agreement (a "Shareholder
Material Adverse Effect"), nor will such action result in any violation of
the provisions of the charter or by-laws of the Selling Shareholder or any
applicable treaty, law, statute, rule, regulation, judgment, order, writ
or decree of any government, government
10
instrumentality or court, domestic or foreign, having jurisdiction over
the Selling Shareholder or any of its properties, except for such
violations that would not result in a Shareholder Material Adverse Effect.
(c) Good and Marketable Title.
Woodbridge has at the date hereof and 986269 will at the Closing
Time and, if any Option Securities are purchased, on the Date of Delivery
have good and marketable title to the Securities to be sold by 986269
hereunder, free and clear of any security interest, mortgage, pledge,
lien, charge, claim, equity or encumbrance of any kind, other than
pursuant to this Agreement; and upon delivery of such Securities and
payment of the purchase price therefor as herein contemplated, assuming
each such Underwriter has no notice of any adverse claim, each of the
Underwriters will receive good and marketable title to the Securities
purchased by it from 986269, free and clear of any security interest,
mortgage, pledge, lien, charge, claim, equity or encumbrance of any kind.
Woodbridge owns, directly or indirectly, all of the issued and outstanding
capital stock of 986269, free and clear of any security interest,
mortgage, pledge, lien, charge, claim, equity or encumbrance of any kind.
(d) Tax Reporting.
In order to document the Underwriters' compliance with the reporting
and withholding provisions of the Internal Revenue Code of 1986, as
amended, with respect to the transactions herein contemplated, the Selling
Shareholder will deliver to the Underwriters prior to or at the Closing
Time a properly completed and executed United States Treasury Department
Form W-8BEN (or other applicable form or statement specified by Treasury
Department regulations in lieu thereof).
(e) Absence of Manipulation.
The Selling Shareholder has not taken, and will not take, directly
or indirectly, any action which is designed to or which has constituted or
which might reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities.
(f) Absence of Further Requirements.
No filing with, or consent, approval, authorization, order,
registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the
performance by the Selling Shareholder of its obligations hereunder, or in
connection with the sale and delivery of the Securities by 986269
hereunder or the consummation of the transactions contemplated by this
Agreement, except (i) such as may have already been made or obtained or as
may be required under the 1933 Act or state securities laws or Canadian
Securities Laws and (ii) such as have been obtained under the laws and
regulations of jurisdictions outside the United States in which the
Reserved Securities are offered.
11
(g) Restriction on Sale of Securities.
During a period of 90 days from the date of the Canadian Prospectus
and the U.S. Prospectus, the Selling Shareholder will not, without the
prior written consent of the Representatives, directly or indirectly, (i)
offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right
or warrant for sale, lend or otherwise transfer or dispose of any Common
Shares or any securities convertible into or exercisable or exchangeable
for Common Shares or request or demand the filing of any registration
statement under the 1933 Act or prospectus under Canadian Securities Laws
with respect to any of the foregoing, (ii) enter into any swap or any
other agreement or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequences of ownership of the
Common Shares, whether any such swap or transaction described in this
clause (ii) is to be settled by delivery of Common Shares or such other
securities, in cash or otherwise, or (iii) publicly announce its intention
to enter into the transactions described under clauses (i) and (ii). The
foregoing sentence shall not apply to (i) the Securities to be sold
hereunder; (ii) the series of transactions to assist Woodbridge in
organizing its holding of Common Shares to achieve certain Canadian tax
objectives and similar transactions involving companies affiliated with
Woodbridge prior to the Closing Time or in the case of any Option
Securities being sold by 986269, prior to any Date of Delivery (the
"Reorganization") before Closing; (iii) any pledge by Woodbridge of Common
Shares as security under Woodbridge Finance Corporation's commercial paper
program (the "Program") pursuant to the Trust Indenture among Woodbridge
Finance Corporation, Woodbridge and Montreal Trust Company of Canada dated
as of April 8, 1999 and (iv) transfers or other dispositions of Common
Shares to members of the family of the late the first Lord Thomson of
Fleet, trusts established for their benefit or corporations all the shares
of which are directly or indirectly owned by one or more of such family
member or trusts (collectively, the "Permitted Transferees"), provided
that if a Permitted Transferee is not a company controlled by Xxxxxxx X.
Xxxxxxx, then prior to such transfer or disposition, the Permitted
Transferee shall have delivered to the Underwriters an undertaking similar
to that given herein.
(h) Certificates Suitable for Transfer.
Certificates for all of the Securities to be sold by 986269 pursuant
to this Agreement shall be in suitable form for transfer by delivery or
accompanied by duly executed instruments of transfer or assignment in
blank.
(i) No Association with NASD.
Neither the Selling Shareholder nor any of its affiliates directly,
or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, or has any other
association with (within the meaning of Article I, Section 1(m) of the
By-laws of the NASD), any member firm of the NASD.
12
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities.
On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Company and
the Selling Shareholder, severally and not jointly, agree to sell to each
Underwriter, and each Underwriter, severally and not jointly, agrees to
purchase from the Company and 986269, at the price per share set forth in
Schedule C, that proportion of the number of Initial Securities set forth
in Schedule B opposite the name of the Company or 986269, as the case may
be, which the number of Initial Securities set forth in Schedule A
opposite the name of such Underwriter, plus any additional number of
Initial Securities which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 10 hereof, bears to the total number
of Initial Securities, subject, in each case, to such adjustments among
the Underwriters as the Representatives in their sole discretion shall
make to eliminate any sales or purchases of fractional securities.
(b) Option Securities.
In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth,
986269 hereby grants an option to the Underwriters, severally and not
jointly, to purchase up to an additional 5,700,000 Common Shares, as set
forth in Schedule B, at the price per share set forth in Schedule C, less
an amount per share equal to any dividends or distributions declared by
the Company and payable on the Initial Securities but not payable on the
Option Securities. The option hereby granted will expire 30 days after the
date hereof and may be exercised in whole or in part at any time and from
time to time for the purpose of covering over-allotments which may be made
in connection with the offering and distribution of the Initial Securities
upon notice by the Representatives to 986269 setting forth the number of
Option Securities as to which the several Underwriters are then exercising
the option and the time and date of payment and delivery for such Option
Securities. Any such time and date of delivery (a "Date of Delivery")
shall be determined by the Representatives, but shall not be later than
seven full business days after the exercise of said option, nor in any
event, prior to the Closing Time, as hereinafter defined. If the option is
exercised as to all or any portion of the Option Securities, each of the
Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased
which the number of Initial Securities set forth in Schedule A opposite
the name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such adjustments as the
Representatives in their discretion shall make to eliminate any sales or
purchases of fractional shares.
(c) Payment.
Payment of the purchase price for, and delivery of certificates for,
the Initial Securities shall be made at the offices of Shearman &
Sterling, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, or at such
other place as shall be agreed upon by the Representatives and the Company
and the Selling Shareholder, at 8:30 A.M. (Eastern
13
daylight time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern daylight time) on any given day) business day after the date
hereof (unless postponed in accordance with the provisions of Section 10),
or such other time after such date as shall be agreed upon by the
Representatives and the Company and the Selling Shareholder (such time and
date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities
are purchased by the Underwriters, payment of the purchase price for, and
delivery of certificates for, such Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by
the Representatives and the Selling Shareholder, on each Date of Delivery
as specified in the notice from the Representatives to the Selling
Shareholder.
Payment for the Securities to be issued by the Company and to be
sold by 986269 shall be made to the Company and the Selling Shareholder,
respectively, by wire transfer of immediately available funds to bank
accounts designated by the Company and the Selling Shareholder, as the
case may be, against delivery to the Representatives for the respective
accounts of the Underwriters of certificate(s) for the Securities to be
purchased by them as well as payment of the underwriters' commission as
set forth in Schedule C (the "Underwriting Commission") by wire transfer
of immediately available funds to bank accounts designated by the
Representatives in consideration of the services rendered and to be
rendered by the Underwriters in connection with the offer and sale of the
Securities, including but not limited to: acting as financial advisors to
the Company; assisting in the preparation of the Registration Statement,
the Canadian Prospectus and the U.S. Prospectus and related documentation
in order to qualify the Securities for sale in Canada and the registration
of the Securities for sale in the United States; selling the Securities to
the public both directly and through dealers and brokers; and performing
administrative work in connection with the sale of the Securities. It is
understood that each Underwriter has authorized the Representatives, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Initial Securities and the Option Securities, if
any, which it has agreed to purchase and to accept delivery of the
Underwriting Commission. The Representatives, individually and not as
representatives of the Underwriters, may (but shall not be obligated to)
make payment of the purchase price for the Initial Securities or the
Option Securities, if any, to be purchased by any Underwriter whose funds
have not been received by the Closing Time or the relevant Date of
Delivery, as the case may be, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(d) Denominations; Registration.
Certificates for the Initial Securities and the Option Securities,
if any, shall be in such denominations and registered in such names as the
Representatives may request in writing not less than one full business day
before the Closing Time or the relevant Date of Delivery, as the case may
be. The certificates for the Initial Securities and the Option Securities,
if any, will be made available for examination and packaging by the
Representatives in The City of New York not later than 1:00 P.M. (Eastern
daylight time) on the business day prior to the Closing Time or the
relevant Date of Delivery, as the case may be.
14
(e) Appointment of Qualified Independent Underwriters.
The Company and the Selling Shareholder hereby confirm their
engagement of Xxxxxxx Xxxxx and Xxxxxx Xxxxxxx as, and Xxxxxxx Xxxxx and
Xxxxxx Xxxxxxx hereby confirm their respective agreements with the Company
and the Selling Shareholder to render services as, each a "qualified
independent underwriter" within the meaning of Rule 2720 of the Conduct
Rules of the NASD with respect to the offering and sale of the Securities.
Xxxxxxx Xxxxx and Xxxxxx Xxxxxxx, solely in their respective capacity as
qualified independent underwriters and not otherwise, are collectively
referred to herein as the "Independent Underwriter".
SECTION 3. Covenants of the Company. The Company covenants with the
Representatives, and with each Underwriter participating in the offering of
Securities, as follows:
(a) Compliance with Securities Regulations and Commission Requests.
Prior to the termination of the offering of the Securities, the
Company will not file any amendment to the Registration Statement
(including the U.S. Prospectus or any preliminary U.S. Prospectus) or any
amendment or supplement to the Canadian Prospectus unless the Company has
furnished to the Representatives a copy for their review prior to filing.
Subject to the foregoing sentence, the Company will prepare the
Supplemented PREP Prospectus and the U.S. Supplemented Prospectus setting
forth the number of Securities covered thereby, the names of the
Underwriters participating in the offering and the number of Securities
which each severally has agreed to purchase, the names of the Underwriters
acting as co-managers in connection with the offering, the price at which
the Securities are to be purchased by the Underwriters from the Company
and 986269, the initial public offering price and commissions to be earned
by the Underwriters, in a form approved by the Representatives (acting
reasonably) and shall file (i) such Supplemented PREP Prospectus with the
Qualifying Authorities in accordance with the PREP Procedures and (ii)
such U.S. Supplemented Prospectus with the Commission pursuant to General
Instruction II.L. of Form F-10 under the 1933 Act not later than the
Commission's close of business on the business day following the date of
the filing of the Supplemented PREP Prospectus with the Qualifying
Authorities. The Company will promptly file all reports required to be
filed by it pursuant to the Canadian Securities Laws and the Commission
pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act within the
time periods required by the Exchange Act and the rules and regulations of
the Commission thereunder for so long as the delivery of a prospectus is
required in connection with the offering or sale of the Securities, and
during such same period will advise the Representatives, promptly after it
receives notice thereof, of the time when any amendment or supplement to
the Canadian Prospectus has been filed or receipted, when any amendment to
the Registration Statement has been filed or becomes effective or any
supplement to the Canadian Preliminary Prospectus or any amended Canadian
Prospectus or U.S. Prospectus has been filed with the Qualifying
Authorities or the Commission, of the issuance by any of the Qualifying
Authorities or the Commission of any stop order or of any order preventing
or suspending the use of any prospectus relating to the Securities, of the
suspension of the qualification of such Securities for offering or sale in
any jurisdiction, of the issuance by any Qualifying Authority or any
15
stock exchange or any court of any order having the effect of ceasing or
suspending the distribution of the Securities or the trading in the Common
Shares of the Company, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Reviewing Authority or the
Commission for the amending or supplementing of the Registration
Statement, the Canadian Prospectus or the U.S. Prospectus or for
additional information relating to the Securities; and, the Company will
make every reasonable effort to prevent the issuance of any such stop
order or any such order preventing or suspending the use of any prospectus
relating to the Securities or the suspension of any such qualification or
the ceasing or suspending of the distribution of the Securities or the
trading of the Common Shares of the Company and, in the event of the
issuance of any such stop order or of any such order preventing or
suspending the use of any prospectus relating to the Securities or
suspending any such qualification or the ceasing or suspending of the
distribution of the Securities or the trading of the Common Shares of the
Company, to promptly make every reasonable effort to obtain the withdrawal
of such order.
(b) Filing of Amendments.
If, at any time when a prospectus relating to the Securities is
required to be delivered under the 1933 Act, any event occurs as a result
of which the Canadian Prospectus or the U.S. Prospectus, each as then
supplemented, would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein
in the light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend the Registration
Statement or amend or supplement the Canadian Prospectus or the U.S.
Prospectus to comply with Canadian Securities Laws, the 1933 Act or the
Exchange Act, or the respective rules thereunder, the Company promptly
will (1) notify the Representatives of such event, (2) prepare and file
with the Qualifying Authorities and the Commission, subject to the first
sentence of paragraph (a) of this Section 3, an amendment or supplement
which will correct such statement or omission or effect such compliance
and (3) supply any supplemented or amended Canadian Prospectus and U.S.
Prospectus to the Representatives in such quantities as they may
reasonably request.
(c) Delivery of Filed Documents.
The Company has furnished or will deliver to the Representatives and
counsel for the Underwriters, without charge, signed copies of the
Canadian Preliminary Prospectus, the Canadian Amended Preliminary
Prospectus, the Final PREP Prospectus and the Supplemented PREP
Prospectus, approved, signed and certified as required by Canadian
Securities Laws and signed and conformed copies of the Registration
Statement as originally filed and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference therein
and including a signed copy of the Form F-X), signed copies of all
consents and certificates of experts and as many commercial copies of the
U.S. Prospectus and of the Canadian Prospectus (each as amended or
supplemented), and to such locales, as the Representatives may reasonably
request not later than 9:00 am (local time) the business day next
following the date hereof.
16
(d) Blue Sky Qualifications.
The Company will use its best efforts, in cooperation with the
Underwriters, to qualify the Securities for offering and sale under the
applicable securities laws of such states and other jurisdictions of the
United States as the Representatives may designate and to maintain such
qualifications in effect so long as required for the distribution of the
Securities; provided, however, that the Company shall not be obligated to
file any general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In
each jurisdiction in which the Securities have been so qualified, the
Company will file such statements and reports as may be required by the
laws of such jurisdiction to continue such qualification in effect so long
as required for the sale of the Securities. The Company will also supply
the Underwriters with such information as is necessary for the
determination of the legality of the Securities for investment under the
laws of such jurisdictions as the Underwriters may request.
(e) Rule 158.
With respect to the Securities, the Company will timely file such
reports pursuant to the Exchange Act as are necessary in order to make
generally available to its securityholders as soon as practicable an
earnings statement for the purposes of, and to provide the benefits
contemplated by, the last paragraph of Section 11(a) of the 1933 Act.
(f) Use of Proceeds.
The Company will use the net proceeds received by it from the sale
of the Securities in the manner specified in the U.S. Prospectus and in
the Canadian Prospectus under "Use of Proceeds".
(g) Restriction on Sale of Securities.
During a period of 90 days from the date of the Canadian and the
U.S. Prospectus, the Company will not, without the prior written consent
of the Representatives, directly or indirectly, (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant for sale,
lend or otherwise transfer or dispose of any Common Shares or any
securities convertible into or exercisable or exchangeable for Common
Shares or file any registration statement under the 1933 Act or prospectus
under Canadian Securities Laws with respect to any of the foregoing, (ii)
enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic
consequences of ownership of the Common Shares, whether any such swap or
transaction described in this clause (ii) is to be settled by delivery of
Common Shares or such other securities, in cash or otherwise or (iii)
publicly announce its intention to enter into the transactions described
under clauses (i) or (ii). The foregoing sentence shall not apply to (A)
the Securities to be sold hereunder, (B) any Common Shares issued by the
Company upon the exercise of an option or warrant or the conversion of a
security outstanding on
17
the date hereof and referred to in the Canadian and the U.S. Prospectus,
(C) any Common Shares issued or options to purchase Common Shares granted
pursuant to existing employee benefit plans or dividend reinvestment plans
of the Company referred to in the Canadian and the U.S. Prospectus, (D)
any Common Shares issued pursuant to any non-employee director stock plan,
(E) the Reorganization or (F) Common Shares to be issued on a private
placement basis to an affiliate of Woodbridge in satisfaction of its
commitment to reinvest at least 50% of the dividends Woodbridge receives
on the Common Shares it, directly and indirectly, owns in additional
Common Shares under the Company's dividend reinvestment plan.
(h) Delivery of Opinion.
The Company shall cause Xxxxxxxxxx Xxxxxxxx Xxxxx Xxxxxx, to
deliver to the Underwriters an opinion, dated and delivered the date of
the filing of the French language versions of each of the Canadian Amended
Preliminary Prospectus, the Final PREP Prospectus and the Supplemented
PREP Prospectus, to the effect that, except for certain financial
information described in the letter of PricewaterhouseCoopers LLP (as
described below), the French language version of each such prospectus is
in all material respects a complete and proper translation of the English
versions thereof and is not susceptible of any materially different
interpretation with respect to any material matter contained therein. The
Company shall also cause PricewaterhouseCoopers LLP to deliver to the
Underwriters letters, dated the date of the filing of the French language
versions of each of the Canadian Amended Preliminary Prospectus, Final
PREP Prospectus and the Supplemented PREP Prospectus, to the effect that
the financial information in the French language version of each such
prospectus is in all material respects a complete and proper translation
of such information contained in the English versions thereof and is not
susceptible of any materially different interpretation with respect to any
material matter contained therein. The Company shall cause Xxxxxxxxxx
Xxxxxxxx Xxxxx Xxxxxx and PricewaterhouseCoopers LLP to deliver to you
similar opinions as to the French language translation of any information
contained in any Supplementary Material, in form and substance
satisfactory to the Underwriters, prior to the filing thereof with the
Commission des valeurs mobilieres du Quebec.
(i) Listing.
The Company will use its best efforts to effect the listing of the
Common Shares (including the Securities) on the New York Stock Exchange;
and it has obtained the conditional approval of the Toronto Stock Exchange
for the listing of the Securities and will use its best efforts to satisfy
any requirements of the Toronto Stock Exchange to the listing thereof
within the time specified for such approval.
(j) Compliance with NASD Rules.
The Company hereby agrees that it will ensure that the Reserved
Securities will be restricted as required by the NASD or the NASD rules
from sale, transfer, assignment, pledge or hypothecation for a period of
three months following the date of this Agreement. The Underwriters will
notify the Company as to which persons will need to
18
be so restricted. At the request of the Underwriters, the Company will
direct the transfer agent to place a stop transfer restriction upon such
securities for such period of time. Should the Company release, or seek to
release, from such restrictions any of the Reserved Securities, the
Company agrees to reimburse the Underwriters for any reasonable expenses
(including, without limitation, legal expenses) they incur in connection
with such release.
(k) Reserved Securities.
The Company will comply with all legal requirements (including all
applicable securities legislation) to be fulfilled by the Company to
enable the reservation and sale of the Reserved Securities to eligible
employees of the Company in jurisdictions outside of Canada and the United
States where Reserved Securities have been offered.
19
SECTION 4. Payment of Expenses.
(a) Expenses.
The Company and the Selling Shareholder will pay all expenses
incident to the performance of their obligations under this Agreement,
including, without limitation, (i) the preparation, printing and filing of
the Registration Statement (including financial statements and exhibits)
as originally filed and of each amendment thereto, the preliminary
prospectuses, the U.S. Prospectus, the Final PREP Prospectus, the Canadian
Prospectus and any Supplementary Material and any amendments or
supplements thereto, the cost of furnishing copies thereof to the
Underwriters, and the Form F-X, (ii) the preparation, printing and
delivery to the Underwriters of this Agreement, any Agreement among
Underwriters and such other documents as may be required in connection
with the offering, purchase, sale, issuance or delivery of the Securities,
(iii) the preparation, issuance and delivery of the certificates for the
Securities to the Underwriters, including any stock or other transfer
taxes and any stamp or other duties payable upon the sale, issuance or
delivery of the Securities to the Underwriters, and their transfer between
Underwriters pursuant to an agreement among such Underwriters, (iv) the
fees and disbursements of the Company's and the Selling Shareholder's
counsel, accountants and other advisors, (v) the printing and delivery to
the Underwriters of commercial copies of each preliminary prospectus, the
Canadian Prospectus and the U.S. Prospectus, and each amendment or
supplement to any of them, (vi) the qualification of the Securities under
applicable securities laws in accordance with the provisions of Section
3(d) hereof; including filing fees and reasonable fees and expenses
associated with the preparation, printing and delivery to the Underwriters
of copies of the "blue sky" survey and any supplement thereto, (vii) the
fees and expenses of any transfer agent or registrar for the Securities,
(viii) any filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the
review by the NASD of the terms of the sale of the Securities and local
counsel opinions in the Qualifying Provinces, (ix) the fees and expenses
incurred in connection with the listing of the Securities on the New York
Stock Exchange and the Toronto Stock Exchange and (x) all reasonable costs
and expenses of the Underwriters incident to the performance by the
Company of its obligations hereunder, including the fees and disbursements
of counsel for the Underwriters, in connection with matters related to the
Reserved Securities which are designated by the Company for sale to
employees. It is hereafter understood that except as specifically provided
in this Section 4, the Underwriters will pay their own costs and expenses,
including fees of their counsel, transfer taxes on the resale of the
Securities by them and any advertising expenses in connection with the
selling efforts they undertake.
(b) Termination of Agreement.
If this Agreement is terminated by the Representatives in accordance
with the provisions of Xxxxxxx 0 (xxxxx xxxx Xxxxxxxx 0(x), (x), (x),
(x)(x) and (n)(vi)), 9(a)(ii) (so long as the suspension in trading of the
Common Shares referred to in Section 9(a)(ii) is not a result of a general
suspension of trading on the Toronto Stock Exchange or the New York Stock
Exchange) or Section 11 hereof, the Company and the Selling Shareholder
20
shall reimburse the Underwriters for all of their out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for the
Underwriters.
(c) Allocation of Expenses.
The provisions of this Section shall not affect any agreement that
the Company and the Selling Shareholder may make for the sharing of such costs
and expenses.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters to purchase Securities hereunder are subject to the
accuracy in all material respects of the representations and warranties of the
Company and the Selling Shareholder contained in Section 1 hereof as of the date
of the Closing Time or in certificates of any officer of the Company or any
subsidiary of the Company or by or on behalf of the Selling Shareholder
delivered pursuant to the provisions hereof, to the performance by the Company
and the Selling Shareholder in all material respects of their respective
covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement and Qualification of
Canadian Prospectus.
An MRRS Decision Document shall have been obtained from the
Reviewing Authority evidencing the issuance by each of the Qualifying
Authorities of a receipt in respect of the Final PREP Prospectus and the
Supplemented PREP Prospectus shall have been filed with the Qualifying
Authorities as promptly as practicable after the date hereof and, in any
event, within the time period prescribed by, and in accordance with, the
PREP Procedures pursuant to the applicable rules and regulations of the
Qualifying Authorities; the U.S. Supplemented Prospectus shall have been
filed with the Commission pursuant to General Instruction II.L of Form
F-10 under the 1933 Act within the applicable time period prescribed for
filing and the Registration Statement shall have become effective; and at
the Closing Time: no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been initiated or threatened by the Commission; no
order of any Qualifying Authority to cease distribution of the Securities
under the Canadian Prospectus as amended or supplemented shall have been
issued, and no proceedings for such purpose shall be pending or shall have
been instituted or threatened; no order having the effect of ceasing or
suspending the distribution of or the trading in the Common Shares shall
be pending or shall have been issued by any Qualifying Authority or any
stock exchange and no proceeding for such purpose shall be pending or
shall have been instituted or threatened and all requests for additional
information in connection with the offering of the Securities on the part
of the Commission and any Qualifying Authority shall have been complied
with.
(b) Opinions of Counsel for Company.
At the Closing Time, the Representatives shall have received the
favorable opinions, dated as of the Closing Time, of Torys LLP, Canadian
and U.S. counsel for the Company, together with signed or reproduced
copies of such letters for each of the other
21
Underwriters to the effect set forth in Exhibits A and B hereto, which
opinions shall also be addressed to counsel to the Underwriters.
(c) Opinion of Counsel for the Selling Shareholder.
At the Closing Time, the Representatives shall have received the
favorable opinion, dated as of the Closing Time, of Torys LLP, Canadian
and U.S. counsel for the Selling Shareholder together with signed or
reproduced copies of such letter for each of the other Underwriters to the
effect set forth in Exhibit C hereto, which opinion shall also be
addressed to counsel to the Underwriters.
(d) Opinion of U.S. Counsel for Underwriters.
At the Closing Time, the Representatives shall have received the
favorable opinion, dated as of the Closing Time, of Shearman & Sterling,
U.S. counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters, in form and
substance satisfactory to the Underwriters acting reasonably. In giving
such opinion such counsel may rely, as to all matters governed by the laws
of jurisdictions other than the law of the State of New York and the
federal law of the United States, upon the opinions of counsel
satisfactory to the Representatives. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of officers of the Company and
its subsidiaries and certificates of public officials.
(e) Opinion of Canadian Counsel for Underwriters.
At the Closing Time, the Representatives shall have received the
favorable opinion, dated as of the Closing Time, of XxXxxxxx Xxxxxxxx LLP,
Canadian counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters, in form and
substance satisfactory to the Underwriters acting reasonably. In giving
such opinion such counsel may rely, as to all matters governed by the laws
of jurisdictions other than the law of the Province of Ontario and the
federal law of Canada, upon the opinions of counsel satisfactory to the
Representatives. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem
proper, upon certificates of officers of the Company and its subsidiaries
and certificates of public officials.
(f) No Material Adverse Change.
Since the date hereof or since the respective dates as of which
information is given in the Canadian Prospectus (exclusive of any
amendments or supplements thereto after the date of this Agreement) and
the U.S. Prospectus (exclusive of any amendments or supplements thereto
after the date of this Agreement), there shall not have been any material
adverse change or any development involving a prospective change in the
business, affairs, results of operations, assets, liabilities (contingent
or otherwise) or capital of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business,
which in the judgment of the Representatives, is material and adverse, and
in the judgment of the Representatives, makes it
22
impracticable to market the Securities on the terms and in the manner
contemplated in the U.S. Prospectus and in the Canadian Prospectus.
(g) Officers' Certificate.
At the Closing Time, there shall not have been, since the date
hereof or since the respective dates as of which information is given in
the Canadian Prospectus (exclusive of any amendments or supplements
thereto after the date of this Agreement) and the U.S. Prospectus
(exclusive of any amendments or supplements thereto after the date of this
Agreement), any material adverse change in the business affairs, results
of operations, assets, liabilities (contingent or otherwise) or capital of
the Company and its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, and the Representatives
shall have received a certificate of the President or a Vice President of
the Company and of the chief financial or chief accounting officer of the
Company, dated as of the Closing Time, to the effect that (i) there has
been no such material adverse change, (ii) the representations and
warranties in Section 1(A) hereof are true and correct in all respects
with the same force and effect as though expressly made at and as of the
Closing Time, (iii) the Company has complied in all material respects with
all agreements and satisfied in all respects all conditions on its part to
be performed or satisfied at or prior to the Closing Time, and (iv) no
stop order suspending the effectiveness of the Registration Statement has
been issued and no order having the effect of ceasing or suspending the
distribution of the Securities has been issued by the Commission, or any
Qualifying Authority and no proceedings for that purpose have been
instituted, or to the knowledge of the Company, are pending or are
contemplated by the Commission or any Qualifying Authority.
(h) Certificate of Selling Shareholder.
At the Closing Time, the Representatives shall have received a
certificate of an executive officer of the Selling Shareholder, dated as
of the Closing Time, to the effect that (i) the representations and
warranties of the Selling Shareholder contained in Section 1(B) hereof are
true and correct in all respects with the same force and effect as though
expressly made at and as of the Closing Time and (ii) the Selling
Shareholder has complied in all material respects with all agreements and
all conditions on its part to be performed under this Agreement at or
prior to the Closing Time.
(i) Accountants' Comfort Letter.
At the time of the execution of this Agreement, the Representatives
shall have received from PricewaterhouseCoopers LLP a letter dated such
date, in form and substance reasonably satisfactory to the
Representatives, together with signed or reproduced copies of such letter
for each of the other Underwriters containing statements and information
of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain
financial information contained in the Registration Statement, the U.S.
Prospectus and the Canadian Prospectus.
23
(j) Bring-down Comfort Letter.
At the Closing Time, the Representatives shall have received from
PricewaterhouseCoopers LLP a letter, dated as of the Closing Time, to the effect
that they reaffirm the statements made in the letter furnished pursuant to
subsection (i) of this Section, except that the specified date referred to shall
be a date not more than three business days prior to the Closing Time.
(k) Approval of Listing.
At the Closing Time, the Securities shall have been approved for
listing on the New York Stock Exchange, subject only to official notice of
issuance. At the Closing Time, the Securities shall have been conditionally
approved for listing on the Toronto Stock Exchange subject to the satisfaction
of standard listing conditions.
(l) No Objection.
The NASD has confirmed that it has not raised any objection with
respect to the fairness and reasonableness of the underwriting terms and
arrangements.
(m) Lock-up Agreements.
At the date of this Agreement, the Representatives shall have received
an agreement substantially in the form of Exhibit D hereto signed by the persons
listed on Schedule D hereto.
(n) Conditions to Purchase of Option Securities.
In the event that the Underwriters exercise their option provided in
Section 2(b) hereof to purchase all or any portion of the Option Securities, the
representations and warranties of the Company and the Selling Shareholder
contained herein and the statements in any certificates furnished by the
Company, any subsidiary of the Company and the Selling Shareholder hereunder
shall be true and correct as of each Date of Delivery and, at the relevant Date
of Delivery, the Representatives shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of
the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time pursuant
to Section 5(g) hereof remains true and correct as of such Date of
Delivery.
(ii) Certificate of Selling Shareholder. A certificate, dated
such Date of Delivery, of an executive officer of the Selling
Shareholder confirming that the certificate delivered at the Closing
Time pursuant to Section 5(h) hereof remains true and correct as of
such Date of Delivery.
(iii) Opinions of Counsel for Company. The favorable opinions
of Torys LLP, Canadian counsel and U.S. counsel for the Company, in
form and
24
substance reasonably satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(b) hereof.
(iv) Opinion of Counsel for the Selling Shareholder. The
favorable opinion of Torys LLP, Canadian counsel and U.S. counsel for
the Selling Shareholder, in form and substance reasonably satisfactory
to counsel for the Underwriters, dated such Date of Delivery, relating
to the Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(c)
hereof.
(v) Opinion of U.S. Counsel for Underwriters. The favorable
opinion of Shearman & Sterling, U.S. counsel for the Underwriters,
dated such Date of Delivery, relating to the Option Securities to be
purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(d) hereof.
(vi) Opinion of Canadian Counsel for Underwriters. The
favorable opinion of XxXxxxxx Xxxxxxxx LLP, Canadian counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(e) hereof.
(vii) Bring-down Comfort Letter. A letter from
PricewaterhouseCoopers LLP, in form and substance reasonably
satisfactory to the Representatives and dated such Date of Delivery,
substantially in the same form and substance as the letter furnished to
the Representatives pursuant to Section 5(j) hereof, except that the
"specified date" in the letter furnished pursuant to this paragraph
shall be a date not more than five days prior to such Date of Delivery.
(o) Additional Documents.
At the Closing Time and at each Date of Delivery, counsel for the
Underwriters shall have been furnished with such documents as they may
reasonably require for the purpose of enabling them to pass upon the issuance
and sale of the Securities as herein contemplated, or in order to evidence the
accuracy of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Company
and the Selling Shareholder in connection with the issuance and sale of the
Securities as herein contemplated shall be reasonably satisfactory in form and
substance to the Representatives and counsel for the Underwriters.
(p) Termination of Agreement.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement, or, in the case
of any condition to the purchase of Option Securities on a Date of Delivery
which is after the Closing Time, the obligations
25
of the several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representatives by notice to the Company at any time at or
prior to the Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7, 8, 12 and 13 shall
survive any such termination and remain in full force and effect.
Section 6. Indemnification.
(a) Indemnification of Underwriters.
(1) The Company and the Selling Shareholder, jointly and severally,
agree to indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the Exchange Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), or the
omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein not
misleading or arising out of any untrue statement or alleged
untrue statement of a material fact included in any
preliminary prospectus or the U.S. Prospectus or the Canadian
Prospectus or Supplementary Material (or any amendment or
supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of (A) breach by the
Company of its covenant provided for in Section 3(k) or the
violation of any applicable laws or regulations of
jurisdictions outside of Canada and the United States where
Reserved Securities have been offered and (B) any untrue
statement or alleged untrue statement of a material fact
included in the supplement or prospectus wrapper material
distributed in connection with the reservation and sale of the
Reserved Securities to eligible employees or the omission or
alleged omission therefrom of a material fact necessary to
make the statements therein, when considered in conjunction
with the Canadian Prospectus, the U.S. Prospectus, the
Canadian Preliminary Prospectus, the Canadian Amended
Preliminary Prospectus, the U.S. Preliminary Prospectus or the
Amended U.S. Preliminary Prospectus, not misleading;
(iii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue
statement or
26
omission, or in connection with any violation of the nature
referred to in Section 6(a)(1)(ii)(A); provided that (subject
to Section 6(d) below) any such settlement is effected with
the written consent of the Company or the Selling Shareholder;
and
(iv) against any and all expense whatsoever, as incurred (including
the reasonable fees and disbursements of counsel chosen by the
Representatives), reasonably incurred in investigating,
preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any
such expense is not paid under (i), (ii) or (iii) above;
provided, however, that the foregoing indemnity shall not apply to any
loss, liability, claim, damage or expense to the extent incurred or
arising out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with
written information furnished to the Company by any Underwriter through
the Representatives expressly for use in the Registration Statement (or
any amendment thereto) or any preliminary prospectus or the U.S.
Prospectus or the Canadian Prospectus or any Supplementary Material (or
any amendment or supplement thereto); and provided, further, that the
foregoing indemnity as it applies to any preliminary prospectus shall
not inure to the benefit of any Underwriter from whom the person
asserting any such losses, liabilities, claims, damages or expenses
purchased Securities, or any person controlling such Underwriter, if a
copy of the U.S. Prospectus or the Canadian Prospectus (as then amended
or supplemented if the Company shall have furnished any such amendments
or supplements thereto), as applicable, was not sent or given by or on
behalf of such Underwriter to such person, if such is required by law,
and if the U.S. Prospectus or the Canadian Prospectus (as so amended or
supplemented), as applicable, would have corrected the defect giving
rise to such loss, liability, claim, damage or expense, and provided,
further, that the liability of the Selling Shareholder under this
Section 6 shall be limited to the gross proceeds (before expenses)
received by it from the sale of Securities under this Agreement.
(2) In addition to and without limitation of the Company's and
the Selling Shareholder's obligation to indemnify Xxxxxxx Xxxxx and
Xxxxxx Xxxxxxx as Underwriters, the Company and the Selling Shareholder
also, jointly and severally, agree to indemnify and hold harmless the
Independent Underwriter and each person, if any, who controls the
Independent Underwriter within the meaning of Section 15 of the 1933
Act or Section 20 of the Exchange Act, from and against any and all
loss, liability, claim, damage and expense whatsoever, as incurred,
incurred as a result of the Independent Underwriter's participation as
a "qualified independent underwriter" within the meaning of Rule 2720
of the Conduct Rules of the NASD in connection with the offering of the
Securities.
(b) Indemnification of Company, Directors and Officers and
Selling Shareholder.
27
Each Underwriter severally agrees to indemnify and hold
harmless the Company, and each of its directors and its officers who
signed the Registration Statement or the Canadian Prospectus, and each
person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act or Section 20 of the Exchange Act, and the Selling
Shareholder and each person, if any, who controls the Selling
Shareholder within the meaning of Section 15 of the 1933 Act or Section
20 of the Exchange Act, against any and all loss, liability, claim,
damage and expense described in the indemnity contained in subsection
(a)(1) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions,
made in the Registration Statement (or any amendment thereto) or any
preliminary prospectus or the U.S. Prospectus or the Canadian
Prospectus (or any amendment or supplement thereto including the PREP
Information) in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives expressly for use in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or the U.S. Prospectus
or any Supplementary Material (or any amendment or supplement thereto)
or the Canadian Prospectus or any Supplementary Material (or any
amendment or supplement thereto).
(c) Actions against Parties; Notification.
Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action
commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the
extent it is not materially prejudiced as a result thereof and in any
event shall not relieve it from any liability which it may have
otherwise than on account of this indemnity agreement. An indemnifying
party will be entitled to participate in, and to the extent that it may
wish, jointly with any other indemnifying party similarly notified,
assume the defense of, any such action, with counsel reasonably
satisfactory to the indemnified party. If the defendants in any such
action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that there
may be one or more legal defenses available to it and/or other
indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnifying party shall not
have the right to direct the defense of such action on behalf of such
indemnified party or parties and such indemnified party or parties
shall have the right to select separate counsel to defend such action
on behalf of such indemnified party or parties. In no event shall the
indemnifying parties be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action
or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, unless
(i) the indemnified party shall have employed separate counsel in
accordance with the preceding sentence, or (ii) the indemnifying party
does not promptly retain counsel satisfactory to the indemnified party,
or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying
party; provided, that, if indemnity is sought pursuant to Section
6(a)(2), then, in addition to the fees and expenses of such counsel for
the indemnified parties, the indemnifying party shall be liable for the
reasonable fees and expenses of not more than
28
one counsel (in addition to any local counsel) separate from its own
counsel and that of the other indemnified parties for the Independent
Underwriter in its capacity as a "qualified independent underwriter"
and all persons, if any, who control the Independent Underwriter within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general
allegations or circumstances if, in the reasonable judgment of the
Independent Underwriter, there may exist a conflict of interest between
the Independent Underwriter and the other indemnified parties. Any such
separate counsel for the Independent Underwriter and such control
persons of the Independent Underwriter shall be designated in writing
by the Independent Underwriter. After such notice from the indemnifying
party to such indemnified party, the indemnifying party will not be
liable for costs and expenses of any settlement of such action effected
by such indemnified party without the consent of the indemnifying
party. No indemnifying party shall, without the prior written consent
of the indemnified parties, settle or compromise or consent to the
entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or
Section 7 hereof (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party
from all liability arising out of such litigation, investigation,
proceeding or claim and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of
any indemnified party.
(d) Settlement without Consent if Failure to Reimburse.
If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and
expenses of counsel in accordance with this Section 6, such
indemnifying party agrees that it shall be liable for any settlement of
the nature contemplated by Section 6(a)(1)(ii) or Section 6(a)(1)(iii)
effected without its written consent if (i) such settlement is entered
into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 30 days prior to such
settlement being entered into and (iii) such indemnifying party shall
not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement.
(e) Indemnification for Reserved Securities.
In connection with the offer and sale of the Reserved
Securities, the Company agrees, promptly upon a request in writing, to
indemnify and hold harmless the Underwriters from and against any and
all losses, liabilities, claims, damages and expenses incurred by them
as a result of the failure of eligible employees to pay for and accept
delivery of Reserved Securities which, by the end of the first business
day following the date of this Agreement, were subject to a properly
confirmed agreement to purchase, provided that the Underwriters shall
first make reasonable efforts to collect amounts owing from such
eligible employees including by reselling the Reserved Securities they
agreed to purchase.
29
(f) Other Agreements with Respect to Indemnification.
The provisions of this Section shall not affect any agreement between
the Company and the Selling Shareholder with respect to indemnification.
Section 7. Contribution.
If the indemnification provided for in Section 6 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Shareholder on the one hand and the Underwriters on the other hand from the
offering of the Securities pursuant to this Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Selling Shareholder
on the one hand and of the Underwriters on the other hand in connection with the
statements or omissions, or in connection with any violation of the nature
referred to in Section 6(a)(1)(ii)(A) hereof, which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Selling
Shareholder on the one hand and the Underwriters on the other hand in connection
with the offering of the Securities pursuant to this Agreement shall be deemed
to be in the same respective proportions as the total net proceeds from the
offering of the Securities pursuant to this Agreement (before deducting
expenses) received by the Company and the Selling Shareholder and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth on the cover of the U.S. Prospectus, bear to the aggregate
initial public offering price of the Securities as set forth on such cover.
The relative fault of the Company and the Selling Shareholder on the
one hand and the Underwriters on the other hand shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Selling Shareholder or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission or any
violation of the nature referred to in Section 6(a)(ii)(A) hereof.
The Company, the Selling Shareholder and the Underwriters agree that
Xxxxxxx Xxxxx and Xxxxxx Xxxxxxx will not receive any additional benefits
hereunder for serving as the Independent Underwriter in connection with the
offering and sale of the Securities.
The Company, the Selling Shareholder and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to
30
above in this Section. The aggregate amount of losses, liabilities, claims,
damages and expenses incurred by an indemnified party and referred to above in
this Section shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section, (i) no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission and (ii) the liability
of the Selling Shareholder to contribute any amount under this Section 7 shall
be limited to the gross proceeds (before expenses) received by it from the sale
of Securities under this Agreement.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the Exchange Act shall have the same rights to contribution as such Underwriter,
and each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company or the
Selling Shareholder within the meaning of Section 15 of the 1933 Act or Section
20 of the Exchange Act shall have the same rights to contribution as the Company
or the Selling Shareholder, as the case may be. The Underwriters' respective
obligations to contribute pursuant to this Section are several in proportion to
the number of Securities set forth opposite their respective names in Schedule A
hereto and not joint.
The provisions of this Section shall not affect any agreement between
the Company and the Selling Shareholder with respect to contribution.
Section 8. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
subsidiaries or the Selling Shareholder submitted pursuant hereto shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any Underwriter or controlling person, or by or on behalf of the
Company or the Selling Shareholder, and shall survive delivery of the Securities
to the Underwriters.
Section 9. Termination of Agreement.
(a) Termination; General.
The Representatives may terminate this Agreement, by notice to the
Company and the Selling Shareholder, at any time at or prior to the Closing Time
(i) if there has
31
occurred any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change in national or international political, financial or
economic conditions, in each case which is such as to make it, in the reasonable
judgment of the Representatives, impracticable to market the Securities, or (ii)
if trading in the Common Shares has been suspended or materially limited by the
Commission, any Qualifying Authority, the Toronto Stock Exchange or the New York
Stock Exchange, or (iii) if trading generally on the Toronto Stock Exchange or
the New York Stock Exchange has been suspended or materially limited or (iv) if
a material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, Canada or, with respect
to Clearstream or Euroclear systems, in Europe, or (v) if a banking moratorium
has been declared by any Canadian or by U.S. federal or New York State
authorities.
(b) Liabilities.
If any obligations under this Agreement are terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7, 8, 12 and 13 shall survive such termination and remain in full force
and effect with respect thereto.
Section 10. Default by One or More of the Underwriters.
If one or more of the Underwriters shall fail at the Closing Time or a
Date of Delivery to purchase the Securities which it or they are obligated to
purchase under this Agreement (the "Defaulted Securities"), the Representatives
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities in such amounts
as may be agreed upon and upon the terms herein set forth; if, however, the
Representatives shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the number of Securities to be purchased on such date, the
non-defaulting Underwriters shall be obligated, each severally and not
jointly, to purchase the full amount thereof in the proportions that
their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of Securities to be purchased on such date, this Agreement or,
with respect to any Date of Delivery which occurs after the Closing
Time, the obligation of the Underwriters to purchase and of the Selling
Shareholder to sell the Option Securities to be purchased and sold on
such Date of Delivery shall terminate without liability on the part of
any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Selling
32
Shareholder to sell the relevant Option Securities, as the case may be, either
(i) the Representatives or (ii) the Company and the Selling Shareholder shall
have the right to postpone the Closing Time or the relevant Date of Delivery, as
the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement, the U.S. Prospectus or in the
Canadian Prospectus or in any other documents or arrangements. As used herein,
the term "Underwriter" includes any person substituted for an Underwriter under
this Section.
Section 11. Default by the Selling Shareholder or the Company.
If the Company or the Selling Shareholder shall fail at the Closing
Time or at a Date of Delivery to sell the number of Securities that they are
obligated to sell hereunder, then this Agreement shall terminate without any
liability on the part of any non-defaulting party; provided, however, that the
provisions of Sections 1, 4, 6, 7, 8, 12 and 13 shall remain in full force and
effect. No action taken pursuant to this Section shall relieve the Company or
the Selling Shareholder from liability in respect of such default.
Section 12. Agent for Service; Submission to Jurisdiction; Waiver of
Immunities.
By the execution and delivery of this Agreement, the Company and the
Selling Shareholder (i) acknowledge that they have, by separate written
instrument, irrevocably designated and appointed Corporation Service Company,
0000 Xxxxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000 (or any successor)
(together with any successor, the "Agent for Service"), as their respective
authorized agent upon which process may be served in any suit or proceeding
arising out of or relating to this Agreement or the Securities, that may be
instituted in any federal or New York state court in the Borough of Manhattan in
The City of New York, or brought under federal or state securities laws, and
acknowledge that the Agent for Service has accepted such designation, (ii)
submit to the jurisdiction of any such court in any such suit or proceeding, and
(iii) agree that service of process upon the Agent for Service (or any
successor) and written notice of said service to the Company (mailed or
delivered to its Treasurer at its principal office in Stamford, Connecticut),
and in the case of the Selling Shareholder (mailed or delivered to the Vice
President at its principal office in Xxxxxxx, Xxxxxxx, Xxxxxx) shall be deemed
in every respect effective service of process upon the Company and the Selling
Shareholder in any such suit or proceeding. The Company and the Selling
Shareholder further agree to take any and all action, including the execution
and filing of any and all such documents and instruments, as may be necessary to
continue such designation and appointment of the Agent for Service in full force
and effect so long as any of the Securities shall be outstanding.
To the extent that the Company or the Selling Shareholder has or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether through service of notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, it hereby irrevocably waives such immunity in respect of its
obligations under the above-referenced documents, to the extent permitted by
law; provided, however, that nothing in this paragraph shall require the Company
or the Selling Shareholder to attorn to the jurisdiction of any court, other
than any United States federal or state court located in the Borough of
Manhattan, The City of New York, as provided above.
33
The provisions of this Section shall survive any termination of this
Agreement, in whole or in part.
Section 13. Judgment Currency.
The Company and the Selling Shareholder each agree to indemnify each
Underwriter against any loss incurred by such Underwriter as a result of any
judgment or order being given or made for any amount due hereunder and such
judgment or order being expressed and paid in a currency (the "Judgment
Currency") other than United States dollars and as a result of any variation as
between (i) the rate of exchange at which the United States dollar amount is
converted into the Judgment Currency for the purpose of such judgment or order,
and (ii) the rate of exchange at which such Underwriter is able to purchase
United States dollars with the amount of the Judgment Currency actually received
by such Underwriter. The foregoing indemnity shall constitute a separate and
independent obligation of the Company and the Selling Shareholder and shall
continue in full force and effect notwithstanding any such judgment or order as
aforesaid. The term "rate of exchange" shall include any premiums and costs of
exchange payable in connection with the purchase of, or conversion into, the
relevant currency.
Section 14. Notices.
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriters shall be directed to
Xxxxxxx Xxxxx at Xxxxx Xxxxx, Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
facsimile: (000) 000-0000, attention of Xxxxx Xxxx, Managing Director, and to
Xxxxxx Xxxxxxx at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, facsimile: (212)
761-6873, attention of Xxxxxxx Xxxxx, Executive Director; notices to the Company
shall be directed to it at - Metro Center, Xxx Xxxxxxx Xxxxx, Xxxxxxxx, XX
00000, facsimile: (000) 000-0000, attention: General Counsel; and notices to the
Selling Shareholder shall be directed to The Woodbridge Company Limited, 00
Xxxxx Xxxxxx Xxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx, X0X 0X0, facsimile: (416)
365-9293, attention of the Secretary.
Section 15. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Underwriters, the Company and the Selling Shareholder and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters, the Company and the Selling Shareholder and their respective
successors and the controlling persons and officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company and the Selling Shareholder and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
34
Section 16. GOVERNING LAW AND TIME.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO ITS PRINCIPLES OF CONFLICT
OF LAWS). SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
Section 17. Effect of Headings.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
Section 18. Counterparts.
This Agreement may be signed in two or more counterparts, each of which
shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument.
35
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company and the Selling Shareholder a
counterpart hereof, whereupon this instrument, along with all counterparts, will
become a binding agreement among the Underwriters, the Company and the Selling
Shareholder in accordance with its terms.
Very truly yours,
THE THOMSON CORPORATION
By
----------------------------------
Name:
Title:
THE WOODBRIDGE COMPANY LIMITED
By
----------------------------------
Name:
Title:
986269 ALBERTA LIMITED
By
----------------------------------
Name:
Title:
36
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By
-----------------------------------------------------
Authorized Signatory
By: XXXXXX XXXXXXX & CO. INCORPORATED
By
-----------------------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
37
SCHEDULE A
Number of
Initial
Name of Underwriter Securities
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated*......................................................
Xxxxxx Xxxxxxx & Co. Incorporated*......................................................
Bear, Xxxxxxx & Co. Inc.................................................................
Credit Suisse First Boston Corporation*.................................................
Xxxxxxx, Xxxxx & Co.*...................................................................
RBC Dominion Securities Corporation*....................................................
TD Securities (USA) Inc.*...............................................................
UBS Warburg LLC*........................................................................
BMO Xxxxxxx Xxxxx Inc...................................................................
Xxxxxxx Xxxxx Barney Inc. ..............................................................
X.X. Xxxxxx Securities Inc. ............................................................
CIBC World Markets Corp.* ..............................................................
Banc of America Securities LLC .........................................................
Barclays Bank PLC.......................................................................
Scotia Capital (USA) Inc.* .............................................................
Xxxxxx Brothers Inc. ...................................................................
Deutsche Banc Alex.Xxxxx Inc. ..........................................................
First Union Securities, Inc. ...........................................................
Casenove Inc. ..........................................................................
Xxxxxxxxx Xxxxxxxx, Inc. ...............................................................
ThinkEquity Partners LLC................................................................
Xxxxxxxx & Partners, L.P. ..............................................................
------------
Total...................................................................................
============
* Indicates that the definition of Underwriter includes the Canadian affiliate
of such entities, although such Canadian investment dealer is not independently
obligated to purchase Securities separate and apart from its U.S. affiliate.
Sch A-1
SCHEDULE B
Number of Initial Maximum Number of Option
Securities to be Sold Securities to be Sold
THE THOMSON CORPORATION 14,615,385
000000 XXXXXXX LIMITED 23,384,615 5,700,000
---------- ---------
Total......................................... 38,000,000 5,700,000
========== =========
Sch B-1
SCHEDULE C
THE THOMSON CORPORATION
38,000,000 Common Shares
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be Cdn$- for all Securities sold
in Canada and US$- for all other Securities sold outside of Canada. The Canadian
dollar per share price shall be determined using the U.S. dollar per share price
converted based on the noon buying rate in The City of New York for cable
transfers in Canadian dollars as certified for custom purposes by the Federal
Reserve Bank of New York on the date hereof which is US$1.00 equals Cdn$.
2. The Underwriting Commission to be paid by the Company and the
Selling Shareholder for the Securities to the several Underwriters shall be US$-
per share for all Securities sold outside Canada; provided that the Underwriting
Commission per share for any Option Securities sold by 986269 upon the exercise
of the over-allotment option described in Section 2(b) shall be increased by an
amount per share equal to any dividends or distributions declared by the Company
and payable on the Initial Securities but not payable on the Option Securities.
3. The Underwriting Commission to be paid by the Company and the
Selling Shareholder for the Securities to the several Underwriters shall be
Cdn$- per share for all Securities sold in Canada; provided that the
Underwriting Commission per share for any Option Securities sold by 986269 in
Canada upon the exercise of the over-allotment option described in Section 2(b)
shall be increased by an amount per share equal to any dividends or
distributions declared by the Company and payable on the Initial Securities but
not payable on the Option Securities.
Sch C-1
SCHEDULE D
Persons Subject to Lock-up Agreements*
Xxxxxxx X. Xxxxxxx
W. Xxxxxxxx Xxxxxxx
Xxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Xxxx X. Xxxxxx
V. Xxxxxxx Xxxxxxxx Xxxxxx
Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxx
Xxxxx X. X. Xxxxxxx
Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxx X. Tory
Xxxxxxx X. Xxxxxxxxxx
Xxxxxx X. Xxxxx
Xxxxx X. Xxxx
Xxxxxx X. Xxxxxxxxx
Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx Xxxxxxx
* All persons listed will be signing on behalf of themselves and on behalf of
any entities through which they own Common Shares.
Sch D-1
Exhibit A
OPINION OF TORYS LLP
COMPANY'S CANADIAN COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company has been incorporated and is validly existing as a
corporation under the laws of the Province of Ontario.
(ii) The Company has all necessary corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the U.S. Prospectus and in the Canadian Prospectus and to enter into and
perform its obligations under the Purchase Agreement.
(iii) The authorized capital of the Company is as set forth in the U.S.
Prospectus and in the Canadian Prospectus under the caption "Capitalization"
(except for subsequent issuances, if any, pursuant to the Purchase Agreement or
pursuant to reservations, agreements or employee benefit plans referred to in
the Canadian Prospectus and in the U.S. Prospectus or pursuant to the exercise
of convertible securities or options referred to in the Canadian Prospectus and
in the U.S. Prospectus); prior to the issuance of the Securities, the number of
issued and outstanding Common Shares is 632,113,974 and the issued and
outstanding common shares, including the Securities to be purchased by the
Underwriters from the Selling Shareholder, are outstanding as fully paid and
non-assessable and, in the case of the common shares to be purchased by the
Underwriters from the Company, such common shares have been duly authorized and
validly issued; and to the best knowledge of such counsel, none of the
outstanding share capital of the Company was issued in violation of any
preemptive or other similar rights of any security holder of the Company; and
the Company is not required to be extra-provincially registered or otherwise
duly qualified as an extra-provincial or a foreign corporation in any Province.
(iv) Each Material Canadian Subsidiary has been incorporated and is
validly existing as a corporation under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the U.S. Prospectus and
in the Canadian Prospectus; and each Material Canadian Subsidiary has been
registered as an extra-provincial or foreign corporation or otherwise duly
qualified as an extra-provincial or foreign corporation for the transaction of
business under the laws of each Canadian jurisdiction in which it owns or leases
properties or conducts any business so as to require such qualification; and
except as otherwise disclosed in the Canadian Prospectus, all of the issued and
outstanding shares of each Material Canadian Subsidiary have been duly
authorized and validly issued, and are outstanding as fully paid and
non-assessable and, to the best of our knowledge, based solely upon our review
of the minute books of such Material Canadian Subsidiary, is owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; to the best
knowledge of such counsel, none of the outstanding share capital of any Canadian
Subsidiary
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was issued in violation of the preemptive or similar rights of any security
holder of such Canadian Subsidiary. Material Canadian Subsidiary means, for this
purpose, those subsidiaries of the Company listed in the Company's current
Annual Information Form that are incorporated under the laws of Canada or any
Province thereof.
(v) The Purchase Agreement has been duly authorized, executed and
delivered by the Company.
(vi) The Securities to be issued by the Company pursuant to the
Purchase Agreement have been duly authorized by the Company for issuance and
sale to the Underwriters pursuant to the Purchase Agreement and, when issued and
delivered by the Company pursuant to the Purchase Agreement against payment of
the consideration set forth in the Purchase Agreement, will be validly issued
and outstanding as fully paid and non-assessable and under the Business
Corporations Act (Ontario) holders of the Securities will not be subject to
personal liability by virtue of their ownership of such Securities.
(vii) To the best knowledge of such counsel, the issuance and sale of
the Securities by the Company and the sale of the Securities by the Selling
Shareholder is not subject to any preemptive or other similar rights of any
security holder of the Company.
(viii) Subject to the general limitations and restrictions as set forth
in the Acts and Regulations referred to below as to the amount of funds which
may be invested in any one investment or type or class of investment and
applicable general investment provisions and quantitative and other restrictions
found in such legislation and based upon and subject to the foregoing, the
Securities are, at the date hereof, investments:
(a) in which the provisions of the Insurance Companies Act
(Canada) would not, subject to compliance with the prudent investment
and lending policies, standards and procedures required to be
established pursuant to that Act and in the case of foreign companies
(as defined in that Act) subject to any restriction contained in the
trust deed creating the trust in respect of such assets, preclude the
funds of companies (as defined in that Act) or societies (as defined in
that Act) or the assets of foreign companies (as defined in that Act)
required to be vested in trust, from being invested;
(b) in which the provisions of the Trust and Loan Companies
Act (Canada) would not, subject to compliance with the prudent
investment and lending policies, standards and procedures required to
be established pursuant to that Act, preclude the funds of companies
regulated under that Act from being invested;
(c) in which the provisions of the Pension Benefits Standards
Act, 1985 (Canada) and the Regulation thereunder would not, subject to
compliance with the prudent investment standards of that Act, and
compliance with the statement of investment policies and procedures for
such plan required to be established pursuant to that Act, preclude the
funds of a pension plan regulated thereunder from being invested;
(d) in which the provisions of the Loan and Trust Corporations
Act (Ontario) and the Regulation thereunder would not, subject to
compliance with the prudent
A-3
investment standards of that Act, preclude the funds received as
deposits by registered corporations (as defined in that Act) from being
invested;
(e) in which the provisions of the Pension Benefits Act
(Ontario) and the Regulation thereunder would not preclude the funds of
a pension plan regulated thereunder from being invested, provided that
the investment by such plan in the Securities is in compliance with the
statement of investment policies and procedures established for such
plan that meets the requirements of sections 6, 7, 7.1 and 7.2 and
Schedule III to the Regulation under the Pension Benefits Standards
Act, 1985 (Canada) as it read on December 1, 1999, as incorporated by
reference into the Regulation under the Pension Benefits Act (Ontario),
and provided further that such investment is in compliance with the
prudent investment standards of the Pension Benefits Act (Ontario);
(f) in which the provisions of the Financial Institutions Act
(British Columbia) and the regulations thereunder would not, subject to
compliance with the prudent standards for investment contained therein,
preclude a financial institution (as defined in that Act) that has a
business authorization (as defined in that Act) from making, provided
that:
(i) such financial institution has established a
written investment and lending policy which complies with that
Act;
(ii) the investment by such financial institution in
the Securities is not inconsistent with such policy;
(iii) such written investment and lending policy has
been filed with the Superintendent under that Act; and
(iv) the Company is not a related party (as defined
in that Act) of such financial institution;
(g) in which the provisions of the Pension Benefits Standards
Act (British Columbia) and the Regulations thereunder would not
preclude the funds of a pension plan regulated thereunder from being
invested, provided such funds are invested and loaned only in
accordance with section 44 of that Act and section 6 and Schedule III
of the British Columbia Pension Benefit Standards Regulations, 1985, as
amended;
(h) in which the Insurance Act (Alberta) would not, subject to
compliance with prudent standards for investment contained therein,
preclude a provincial company (as defined in that Act) from loaning or
investing its funds, provided that the loan or investment by such
provincial company is not inconsistent with the policies and procedures
to ensure that the provincial company applies prudent investment
standards required to be established by such provincial company under
that Act;
(i) in which the provisions of the Loan and Trust Corporations
Act (Alberta) and the Regulations thereunder would not, subject to
compliance with the prudent investment standards described therein for
a provincial corporation (as defined in that Act) making investment
decisions and managing its total investments, and the policies
A-4
and procedures established by that provincial corporation in that
regard, preclude a loan corporation or trust corporation (other than a
provincial trust corporation whose registration is subject to a term,
condition or restriction prohibiting it from carrying on the
deposit-taking business) incorporated or continued under such Act from
investing its own funds or funds it receives as deposits (excluding
funds, other than deposits, held by it as a fiduciary);
(j) in which the provisions of the Employment Pension Plans
Act (Alberta) and the Employment Pension Plans Regulation thereunder
would not preclude the administrator (as defined in that Act) of a
pension plan from investing the assets of such pension plan, provided
that such investment is made in a manner that a reasonable and prudent
person would apply to the plan's portfolio of investments having regard
to the plan's liabilities and is made in accordance with (i) Schedule
III to the Pension Benefits Standards Regulations, 1985 (made pursuant
to the Pension Benefits Standards Act, 1985 (Canada)); (ii) the
investment policies and procedures in respect of a pension plan's
portfolio of investments and loans established by the administrator of
that pension plan pursuant to the Employment Pension Plans Regulation;
and (iii) the fiduciary obligations owed by the administrator as a
result of the administrator acting in a fiduciary capacity in relation
to members, former members and others entitled to benefits under the
plan;
(k) in which the provisions of The Pension Benefits Act, 1992
(Saskatchewan) and the Regulations thereto would not, subject to
compliance with the prudent standards for investment contained therein,
preclude a pension plan registered under that Act from investing its
funds, provided that the investment in Securities by the plan is not
inconsistent with any statement of investment policies and procedures
that has been established and filed by the administrator of such plan;
(l) in which The Insurance Act (Manitoba) would not preclude
an insurer incorporated and licensed under the laws of the Province of
Manitoba from investing its surplus funds and reserves pursuant to the
prudent investment policies, standards and procedures applicable to a
company which has obtained an order under section 53 of the Insurance
Companies Act (Canada);
(m) in which the provisions of An Act respecting insurance
(Quebec) would not preclude an insurer (as defined in such Act),
governed thereby (other than a guarantee fund corporation, as defined
in such Act) from investing, subject to compliance with the prudent
investment standards and provided that such investment is in conformity
with the insurer's investment policy established pursuant to such Act;
(n) in which the provisions of An Act respecting trust
companies and savings companies (Quebec) would not prelude as
investments by a trust or savings company, in each case as defined
under such Act (other than a trust company with respect to funds
(except deposits) which it administers for other persons, unless
otherwise provided in the instrument creating the administration), from
making subject to compliance with the prudent investment standards
contained in such Act applicable to a Quebec company, including the
adoption and adherence to an investment policy approved by its board of
directors;
A-5
(o) in which the provisions of the Supplemental Pension Plans
Act (Quebec) and the Regulations thereunder would not, subject to
compliance with the prudent investment standards contained therein,
preclude the assets of a pension plan governed thereby, and in respect
of which a written investment policy conforming to such Act has been
adopted, from being invested, provided, however, that where a written
investment policy as prescribed by such Act has been established and
adopted by the pension committee of such pension plan, such investment,
if selected by the pension committee of such plan or a delegatee
thereof, is made in conformity with a category of investments
specifically permitted in the investment policy for such plan
applicable at the date of offering of the Securities; and
(p) in which the Pension Benefits Act (Nova Scotia) and the
Regulation thereunder would not, subject to compliance with the prudent
investment standards contained therein and the general investment
provisions thereof, preclude the funds of a pension plan registered
under such Act from being invested, provided a written statement of
investment policies and procedures for such plan has been established
in accordance with such Act and Regulation and the Securities are
within a category of investment specifically permitted by such
statement.
(ix) For the purposes of the Income Tax Act (Canada), the
Securities, as of the date hereof, are qualified investments under the Income
Tax Act (Canada) and the Regulations thereunder for trusts governed by a
registered retirement savings plan, a registered retirement income fund, a
deferred profit sharing plan and a registered education savings plan.
(x) The Company is a "reporting issuer" under the
securities legislation of the Province of Ontario and is not on the list of
defaulting issuers maintained under such legislation.
(xi) The Company is a reporting issuer under the
Securities Act (British Columbia) and is not in default of filing financial
statements required by that act or the Securities Rules (British Columbia) or
paying fees and charges prescribed by the Securities Regulation (British
Columbia) relating to those filings.
(xii) The Company is a reporting issuer under the
Securities Act (Alberta) and is not included in a list of defaulting reporting
issuers maintained by the Alberta Securities Commission pursuant to subsection
113(2) of that act.
(xiii) The Company is a reporting issuer under The
Securities Act, 1988 (Saskatchewan) and is not on the list of defaulting
reporting issuers maintained under that act.
(xiv) The Company is subject to the continuous disclosure
reporting requirements of The Securities Act (Manitoba) and accordingly has the
status in the Province of Manitoba of a reporting issuer. The Company is not in
default of its continuous disclosure reporting requirements pursuant to sections
120 and 129 of that act and may be subject to Blanket Exemption Order No. 1638
of the Manitoba Securities Commission, issued January 13, 1997, with respect to
insider reporting requirements currently in effect.
(xv) The Company is a reporting issuer in the Province of
Quebec and is in conformity with Title III "Disclosure Requirements" under the
Securities Act (Quebec).
A-6
(xvi) The Company is a reporting issuer in each of the
Province of Newfoundland and Nova Scotia pursuant to the Securities Act
(Newfoundland) and the Securities Act (Nova Scotia), respectively, and does not
appear on the list of defaulting issuers maintained pursuant to each of those
acts.
(xvii) The form of certificate evidencing the Common Shares
complies in all material respects with all applicable statutory requirements and
with any applicable requirement of the charter and by-laws of the Company,
including the rules of the Toronto Stock Exchange.
(xviii) All necessary documents have been filed, all
necessary proceedings have been taken by the Company and all necessary
authorizations, approvals, permits, consents and orders have been obtained under
the securities laws of each Qualifying Province to permit the Securities to be
issued, offered, sold and delivered pursuant to the U.S./Canadian
Multi-Jurisdictional Disclosure System ("MJDS") in the United States and in each
of the Qualifying Provinces by or through registrants, investment dealers or
brokers duly registered under applicable legislation who have complied with the
relevant provisions of such legislation; and no other consent, approval,
authorization, license, order, registration, qualification or decree of or with
any government, governmental instrumentality, authority or agency or court of
Canada or any Qualifying Province is required for such issuance, offering, sale
or delivery of the Securities pursuant to MJDS in the United States or in any
Qualifying Province or for the consummation by the Company of any of the
transactions contemplated by the Purchase Agreement, except such as have been
obtained or referred to in this paragraph.
(xix) The Securities conform in all material respects to
the descriptions thereof contained in the U.S. Prospectus and in the Canadian
Prospectus.
(xx) An MRRS decision document has been obtained from the
Reviewing Authority in respect of the Canadian Prospectus and, to the best of
our knowledge, no Qualifying Authority has revoked such MRRS decision document
and no order suspending the distribution of the Securities has been issued by
any Qualifying Authority and no proceeding for that purpose is pending or has
been initiated or threatened by any Qualifying Authority.
(xxi) The Canadian Prospectus and the Supplementary
Material (excluding the financial statements and other financial data and the
Supplementary Material included or incorporated therein or omitted therefrom as
to which such counsel need express no opinion) appears on its face to have been
appropriately responsive in all material respects to the requirements of the
securities laws, rules and regulations applicable in the Qualifying Provinces
(the "Canadian Securities Laws").
(xxii) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to which the
Company or any subsidiary is a party, or to which the property of the Company or
any subsidiary is subject, before or brought by any Canadian court or
governmental agency or body, which might reasonably be expected to result in a
Material Adverse Effect, or which might reasonably be expected to materially and
adversely affect the consummation of the transactions contemplated in the
Purchase Agreement or the performance by the Company of its obligations
thereunder.
A-7
(xxiii) The information in the U.S. Prospectus and the
Canadian Prospectus under "Description of Share Capital", "Business - Legal
Proceedings", "Eligibility for Investment", "Statutory Rights of Withdrawal and
Rescission", "Certain United States and Canadian Federal Income Tax
Considerations -- Certain Canadian Federal Income Tax Considerations" and
"Underwriting", and the statements included in the Registration Statement under
"Indemnification", to the extent that it constitutes matters of law, summaries
of legal matters, or legal conclusions, has been reviewed by us and is a fair
summary of such law in all material respects.
(xxiv) All necessary corporate action has been taken by the
Company in connection with the listing of the Securities on the Toronto Stock
Exchange and the New York Stock Exchange and the Toronto Stock Exchange has
conditionally approved the listing of the Securities to be issued by the
Company.
(xxv) There are no reports or other information that, in
accordance with the Canadian Securities Laws, must be made publicly available in
connection with the offering of the Securities that have not been made publicly
available as required, and there are no documents required to be filed with any
Qualifying Authority in connection with the Canadian Prospectus that have not
been filed as required.
(xxvi) The Company is eligible to file a short form
prospectus with the Qualifying Authorities and to use the PREP Procedures in
respect of the Securities.
(xxvii) The Supplemented PREP Prospectus has been filed with
the Qualifying Authorities in the manner and within the time period required by
the PREP Procedures.
(xxviii) The execution, delivery and performance of the
Purchase Agreement, the issuance and delivery of the Securities to be issued by
the Company pursuant to the Purchase Agreement and the consummation of the
transactions contemplated in the Purchase Agreement, the Canadian Prospectus and
in the Registration Statement (including the issuance and sale of the
Securities) and compliance by the Company with its obligations under the
Purchase Agreement do not and will not, to the best of our knowledge, whether
with or without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in Section
1(h) of the Purchase Agreement) under, or result in the creation or imposition
of any tax or any lien, charge or encumbrance upon any property or assets of the
Company or any subsidiary pursuant to, any material contract, indenture, loan or
credit agreement, note, license, lease or any other agreement or instrument,
known to us, to which the Company or any subsidiary is a party or by which it or
any of them may be bound, or to which any of the property or assets of the
Company or any subsidiary is subject except for such conflicts, breaches,
defaults, liens, charges or encumbrances that would not have a Material Adverse
Effect, nor will such action result in any violation of the provisions of the
charter or by-laws of the Company, or any applicable Canadian federal or
provincial treaty, law, statute, rule or regulation, or any judgment, order,
writ or decree, known to us, of any Canadian federal or provincial, government
instrumentality or court, having jurisdiction over the Company or any subsidiary
or any of its properties, assets or operations.
A-8
(xxix) There are no transfer taxes or other similar fees or
charges under the federal laws of Canada or the laws of any province or any
political subdivision thereof, required to be paid in connection with the
execution and delivery of the Purchase Agreement or the issuance by the Company
or sale by the Company of the Securities or the resale of the Securities by an
Underwriter to U.S. residents.
(xxx) The amalgamation agreement (the "Amalgamation
Agreement") dated June 12, 2002 among the Company, WII Investments Inc., 1525557
Ontario Limited, 1525558 Ontario Limited, 1525458 Ontario Limited, 1525459
Ontario Limited, 1525460 Ontario Limited, 1525553 Ontario Limited, 1525554
Ontario Limited, 1525555 Ontario Limited, 1526203 Ontario Limited, 1521490
Ontario Limited, Thomfleet Holdings Limited, 832770 Ontario Limited, 659727
Ontario Limited, Lothlorien Equestrian Centre Limited, Linchris Inc., 832759
Ontario Limited, Lothlorien Limited, 1525452 Ontario Limited, 1527658 Ontario
Limited, 1525454 Ontario Limited, KRT Investments Corp., TLT Investments Corp.,
PJT Investments Corp., PAC Investments Corp., LCC Investments Corp., PGF
Investments Corp., SEG Investments Corp., Jaytor Investments Inc., Thomson Works
of Art Limited and The Woodbridge Company Limited, has been duly authorized,
executed and delivered by the Company and constitutes a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms.
(xxxi) The execution, delivery and performance of the
Amalgamation Agreement and the consummation of the transactions contemplated in
the Amalgamation Agreement and compliance by the Company with its obligations
under the Amalgamation Agreement do not and will not, to the best of our
knowledge, whether with or without the giving of notice or lapse of time or
both, conflict with or constitute a breach of, or default or Repayment Event (as
defined in Section 1(h) of the Purchase Agreement) under, or result in the
creation or imposition of any tax or any lien, charge or encumbrance upon any
property or assets of the Company or any subsidiary pursuant to, any material
contract, indenture, loan or credit agreement, note, license, lease or any other
agreement or instrument, known to us, to which the Company or any subsidiary is
a party or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any subsidiary is subject except for such
conflicts, breaches, defaults, liens, charges or encumbrances that would not
have a Material Adverse Effect, nor will such action result in any violation of
the provisions of the charter or by-laws of the Company, or any applicable
Canadian federal or provincial treaty, law, statute, rule or regulation, or any
judgment, order, writ or decree, known to us, of any Canadian federal or
provincial, government instrumentality or court, having jurisdiction over the
Company or any subsidiary or any of its properties, assets or operations.
(xxxii) The documents incorporated by reference in the
Canadian Prospectus as amended or supplemented (other than the financial
statements and other financial data included or incorporated or deemed to be
incorporated therein, as to which we express no opinion), when they were filed
with the Qualifying Authorities, appear on their face to have been appropriately
responsive in all material respects to the requirements of Canadian Securities
Laws.
(xxxiii) A court of competent jurisdiction in the Province of
Ontario (an "Ontario Court") would give effect to the choice of the law of the
State of New York ("New York Law") as the proper law governing the Purchase
Agreement provided that such choice of
A-9
law is bona fide (in the sense that it was not made with a view to avoiding the
consequences of the laws of any other jurisdiction) and provided that such
choice of New York Law is not contrary to public policy, as that term is applied
by an Ontario Court.
(xxxiv) There are no reasons under the laws of the Province
of Ontario or the federal laws of Canada applicable therein for avoiding the
choice of New York Law to govern the Purchase Agreement.
(xxxv) In an action on a final, conclusive and subsisting
judgment in personam of any federal or state court sitting in The City of New
York (a "New York Court") that is not impeachable as void or voidable under New
York Law, an Ontario Court would give effect to the appointment by the Company
of Corporation Service Company as its agent to receive service of process in the
United States under the Registration Statement and the Purchase Agreement and to
the provisions in the Purchase Agreement whereby the Company has submitted to
the non-exclusive jurisdiction of a New York Court.
(xxxvi) If the Purchase Agreement is sought to be enforced in
the Province of Ontario in accordance with the laws applicable thereto as chosen
by the parties, namely New York Law, and an Ontario Court recognized the choice
of New York Law, an Ontario Court would upon appropriate evidence as to such law
being adduced, apply such law in the enforcement of such documents, provided
that none of the provisions of the Purchase Agreement or of applicable New York
Law is contrary to public policy as that term is applied by an Ontario Court;
provided, however, that, in matters of procedure, the laws of the Province of
Ontario will be applied, and an Ontario Court will retain discretion to decline
to hear such action if it is contrary to public policy, as that term is applied
by an Ontario Court, for it to do so; or if it is not the proper forum to hear
such an action, or if concurrent proceedings are being brought elsewhere.
(xxxvii) The laws of the Province of Ontario and the federal
laws of Canada applicable therein permit an action to be brought before an
Ontario Court on a final and conclusive judgment in personam of a New York Court
respecting the enforcement of the Purchase Agreement that is not impeachable as
void or voidable or otherwise ineffective under New York Law and for a sum
certain if: (a) the New York Court rendering such judgment had jurisdiction over
the Company, as recognized by an Ontario Court; (b) such judgment was not
obtained by fraud or in a manner contrary to natural justice or other rule of
law, whether equitable, legal or statutory, and the enforcement thereof would
not be inconsistent with public policy as such term is understood under the laws
of the Province of Ontario or contrary to any order made by the Attorney General
of Canada under the Foreign Extraterritorial Measures Act (Canada) or by the
Competition Tribunal under the Competition Act (Canada); (c) the enforcement of
such judgment does not constitute, directly or indirectly, the enforcement of
foreign revenue, expropriatory or penal laws; and (d) the action to enforce such
judgment is commenced within the applicable limitation period.
(xxxviii) All payments by the Company pursuant to the Purchase
Agreement shall be made without withholding for taxes under the Income Tax Act
(Canada) provided that such payments are not in respect of services rendered in
Canada.
A-10
(xxxix) As of the Closing Time, all laws of the Province of
Quebec relating to the use of the French language have been complied with in
connection with the offering and sale of the Securities to purchasers in the
Province of Quebec if such purchasers receive copies of the French and English
language versions of the Canadian Prospectus and forms of order and confirmation
in the French language or a bilingual form or copies of the French language
version of the Canadian Prospectus and forms of order and confirmation in the
French language only or, in the case of individuals so requesting in writing,
copies of the English language version of the Canadian Prospectus and forms of
order and confirmation in the English language or in a bilingual form.
We have participated in the preparation of the Registration
Statement, the Canadian Prospectus and the U.S. Prospectus and in conferences
with officers and other representatives of the Company, representatives of the
independent chartered accountants for the Company, and the representatives of
the Underwriters, at which the contents of the Registration Statement, the
Canadian Prospectus, the U.S. Prospectus and related matters were discussed and,
although we have not undertaken to investigate or verify independently, and we
are not passing upon and do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Canadian Prospectus or the U.S. Prospectus, except for those
referred to in paragraph (xxiii) above, on the basis of the foregoing, nothing
has come to our attention that would lead us to believe that any such document
or amendment thereto (except for the financial statements and schedules and
other financial data included or incorporated therein or omitted therefrom as to
which we need make no statement) at the time as such document was filed
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or that the Canadian Prospectus or any amendment or supplement
thereto (except for financial statements and schedules and other financial data
included or incorporated therein or omitted therefrom, as to which we need make
no statement), at the time the Canadian Prospectus was issued, at the time any
such amended or supplemented prospectus was issued or at the Closing Time,
included or includes an untrue statement of a material fact or omitted or omits
to state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may rely, as to
matters of fact (but not as to legal conclusions), to the extent they deem
proper, on certificates of responsible officers of the Company and public
officials. Such counsel may also rely as to matters involving the application of
laws of any jurisdiction other than the Province of Ontario or the Federal laws
of Canada, to the extent they deem proper and specified in such opinion, upon
the opinion of other counsel who are reasonably satisfactory to counsel for the
Underwriters.
A-11
Exhibit B
OPINION OF TORYS LLP
COMPANY'S U.S. COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) Each Material U.S. Subsidiary has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the U.S. Prospectus and in the Canadian Prospectus; except as
otherwise disclosed in the U.S. Prospectus, all of the issued and outstanding
capital stock of each Material U.S. Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and, to the best of our
knowledge, based solely upon our review of the minute books, is owned by the
Company, directly or through one or more wholly-owned subsidiaries, free and
clear of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; and to the best of our knowledge, none of the outstanding share capital
of any U.S. Subsidiary was issued in violation of the preemptive or similar
rights of any security holder of such U.S. Subsidiary. Material U.S. Subsidiary
means, for this purpose, those subsidiaries of the Company listed in Schedule A
hereto.
(ii) Assuming the due authorization, execution and
delivery of the Purchase Agreement by the Company under the laws of the Province
of Ontario and the federal laws of Canada applicable therein, the Purchase
Agreement (to the extent execution and delivery are governed by the laws of the
State of New York) has been duly executed and delivered by the Company.
(iii) Assuming the due authorization, issuance and delivery
of the Securities by the Company under the laws of the Province of Ontario and
the federal laws of Canada applicable therein, the Securities (to the extent
that issuance and delivery are governed by the laws of New York) to be issued by
the Company pursuant to the Purchase Agreement and when issued and delivered by
the Company pursuant to the Purchase Agreement against payment of the
consideration set forth in the Purchase Agreement will be validly issued, fully
paid and non-assessable.
(iv) The Registration Statement became effective under the
1933 Act on June ____, 2002, and no stop order suspending the effectiveness of
the Registration Statement has been issued under the 1933 Act and, to the best
of our knowledge, no proceedings for that purpose have been instituted or are
pending or threatened by the Commission.
(v) The Registration Statement and the U.S. Prospectus,
as of their respective effective or issue dates (other than the financial
statements, schedules and other financial information or data included or
incorporated by reference therein, as to which we do not express any opinion),
complied as to form in all material respects with the requirements of the 1933
Act applicable to registration statements on Form F-10 and the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations").
The Form F-X appears on its
B-1
face to be appropriately responsive in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations applicable to such
form.
(vi) Each document, if any, filed pursuant to the Exchange
Act and incorporated by reference in the U.S. Prospectus (other than the
financial statements and supporting schedules included therein or omitted
therefrom, as to which we need express no opinion) complied when so filed as to
form in all material respects with the Exchange Act; the Form 8-A complied when
so filed as to form in all material respects with the Exchange Act; the
Registration Statement and the U.S. Prospectus and each amendment or supplement
to the Registration Statement and U.S. Prospectus as of their respective
effective or issue dates (other than the financial statements and supporting
schedules included therein or omitted therefrom, as to which we need express no
opinion) complied as to form in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations.
(vii) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to which the
Company or any subsidiary is a party, or to which the property of the Company or
any subsidiary is subject, before or brought by any court or governmental agency
or body in the United States, which might reasonably be expected to result in a
Material Adverse Effect, or which might reasonably be expected to materially and
adversely affect the consummation of the transactions contemplated in the
Purchase Agreement or the performance by the Company of its obligations
thereunder.
(viii) The information in the U.S. Prospectus under "Certain
United States and Canadian Federal Income Tax Considerations -- Certain United
States Federal Income Tax Considerations", to the extent that it constitutes
matters of law, summaries of legal matters, or legal conclusions, has been
reviewed by us and are fair summaries of such law in all material respects.
(ix) Subject to notice of issuance, the Securities to be
issued by the Company have been approved for listing on the New York Stock
Exchange.
(x) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency in the United States (other than under the 1933
Act or the Exchange Act, which have been obtained, or as may be required under
the securities or blue sky laws of the various states) is necessary or required
in connection with the due authorization, execution and delivery of the Purchase
Agreement or for the offering, issuance, sale or delivery of the Securities.
(xi) The execution, delivery and performance of the
Purchase Agreement, the issuance, sale and delivery of the Securities and the
consummation of the transactions contemplated in the Purchase Agreement and in
the Registration Statement (including the issuance and sale of the Securities)
and compliance by the Company with its obligations under the Purchase Agreement
do not and will not result in any violation of the provisions of the charter or
by-laws of any Material U.S. Subsidiary, or result in any violation of any
applicable United States federal or New York law, statute, rule, regulation,
judgment, order, writ or decree, known to us, of any United States federal
government, government instrumentality or court,
B-2
having jurisdiction over the Company or any Material U.S. Subsidiary or any of
its properties, assets or operations.
(xii) The Company is not and, after giving effect to the
offering and sale of the Securities and the application of the proceeds as
described in the Canadian Prospectus and the U.S. Prospectus will not be
required to register as an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
(xiii) Assuming the due authorization, execution and
delivery of the Purchase Agreement by the Company under the laws of Canada, the
submission by the Company to the non-exclusive jurisdiction of any New York
Court pursuant to Section 11 of the Purchase Agreement and the appointment of
the agent for service of process pursuant to Section 11 of the Agreement is
binding on the Company.
(xiv) The form of certificate representing the Securities
complies with the requirements of the New York Stock Exchange.
We have participated in the preparation of the Registration
Statement, the Canadian Prospectus and the U.S. Prospectus and in conferences
with officers and other representatives of the Company, representatives of the
independent chartered accountants for the Company, and the representatives of
the Underwriters, at which the contents of the Registration Statement, the
Canadian Prospectus, the U.S. Prospectus and related matters were discussed and,
although we have not undertaken to investigate or verify independently, and we
are not passing upon and do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Canadian Prospectus or the U.S. Prospectus, except for those
referred to in paragraph (viii) above, on the basis of the foregoing, nothing
has come to our attention that would lead us to believe that the Registration
Statement or any amendment thereto (except for financial statements, notes and
schedules and other financial data included or incorporated therein or omitted
therefrom as to which we need make no statement) at the time such Registration
Statement or any such amendment became effective contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or that the
U.S. Prospectus or any amendment or supplement thereto (except for financial
statements, notes and schedules and other financial data included or
incorporated therein or omitted therefrom, as to which we need make no
statement), at the time the U.S. Prospectus was issued, at the time any such
amended or supplemented prospectus was issued or at the Closing Time, included
or includes an untrue statement of a material fact or omitted or omits to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
B-3
Exhibit C
OPINION OF TORYS LLP
SELLING SHAREHOLDER'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(c)
(i) The Woodbridge Company Limited ("Woodbridge") has
been incorporated and is validly existing as a corporation under the laws of the
Province of Ontario.
(ii) 000000 Xxxxxxx Limited ("986269") has been
incorporated and is validly existing as a corporation under the laws of the
Province of Alberta.
(iii) Each of Woodbridge and 986269 has all necessary
corporate power and authority to enter into the Purchase Agreement and 986269
has all necessary corporate power and authority to sell, transfer and deliver
the Securities to be sold by 986269 under the Purchase Agreement.
(iv) The execution and delivery of the Purchase Agreement
and the sale and delivery of the Securities to be sold by 986269 pursuant to the
Purchase Agreement and the consummation of the transactions contemplated by the
Purchase Agreement and compliance by Woodbridge and 986269 with their respective
obligations under the Purchase Agreement have been duly authorized by each of
Woodbridge and 986269 and do not and will not, to the best of our knowledge,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon the Securities to
be sold by 986269 or any property or assets of Xxxxxxxxxx xx 000000 pursuant to
any material contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, license, lease or other agreement or instrument, known to us,
to which either Woodbridge or 986269 is a party or by either Xxxxxxxxxx xx
000000 may be bound, or to which any of the property or assets of either
Woodbridge or 986269 is subject except for such conflicts, breaches, defaults,
liens, charges or encumbrances that would not result in a Shareholder Material
Adverse Effect, nor will such action result in any violation of the provisions
of the charter or by-laws of either Woodbridge or 986269, or any applicable
Canadian federal or provincial treaty, law, statute, rule or regulation, or any
judgment, order, writ or decree, known to us, of any Canadian federal or
provincial government, government instrumentality or court, domestic or foreign,
having jurisdiction over either Xxxxxxxxxx xx 000000 or any of their respective
properties.
(v) The Purchase Agreement has been duly authorized,
executed and delivered by Woodbridge and 986269.
(vi) Upon delivery of such Securities by 986269, duly
endorsed for transfer or in blank by authorized officers of 986269 and payment
of the purchase price therefor pursuant to the Purchase Agreement, assuming each
such Underwriter has no notice of any adverse claim in respect of such
Securities and each such Underwriter is acting in good faith, each of the
Underwriters will receive good and marketable title to the Securities purchased
by it from
C-1
986269, free of any adverse claim (as such term is defined in the Business
Corporations Act (Ontario)).
(vii) The Subscription Agreement dated May 1, 2002 (the
"Subscription Agreement") among the Company, Woodbridge and The Thomson Company
Inc. ("TTCI"), has been duly authorized, executed and delivered by Woodbridge
and TTCI and constitutes legal, valid and binding obligations of each of
Woodbridge and TTCI, enforceable against them in accordance with its terms.
(viii) The execution, delivery and performance of the
Subscription Agreement and the consummation of the transactions contemplated in
the Subscription Agreement and compliance by Woodbridge and TTCI thereto with
their respective obligations under the Subscription Agreement do not and will
not, to the best of our knowledge, whether with or without the giving of notice
or passage of time or both, conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any tax, lien, charge or
encumbrance upon the Securities to be sold by TTCI or any property or assets of
Woodbridge or TTCI pursuant to any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, license, lease or other agreement or instrument,
known to us, to which either Woodbridge or TTCI is a party or which either
Woodbridge or TTCI may be bound, or to which any of the property or assets of
either Woodbridge or TTCI is subject except for such conflicts, breaches,
defaults, liens, charges or encumbrances that would not result in a Shareholder
Material Adverse Effect, nor will such action result in any violation of the
provisions of the charter or by-laws of Woodbridge or TTCI, or any applicable
Canadian federal or provincial treaty, law, statute, rule or regulation, or any
judgment, order, writ or decree, known to us, of any Canadian federal or
provincial government, government instrumentality or court, domestic or foreign,
having jurisdiction over either Woodbridge or TTCI or any of their respective
properties.
(ix) The amalgamation agreement (the "Amalgamation
Agreement") dated May 1, 2002 among the Company, WII Investments Inc., 1525557
Ontario Limited, 1525558 Ontario Limited, 1525458 Ontario Limited, 1525459
Ontario Limited, 1525460 Ontario Limited, 1525553 Ontario Limited, 1525554
Ontario Limited, 1525555 Ontario Limited, 1526203 Ontario Limited, 1521490
Ontario Limited, Thomfleet Holdings Limited, 832770 Ontario Limited, 659727
Ontario Limited, Lothlorien Equestrian Centre Limited, Linchris Inc., 832759
Ontario Limited, Lothlorien Limited, 1525452 Ontario Limited, 1527658 Ontario
Limited, 1525454 Ontario Limited, KRT Investments Corp., TLT Investments Corp.,
PJT Investments Corp., PAC Investments Corp., LCC Investments Corp., PGF
Investments Corp., SEG Investments Corp., Jaytor Investments Inc., Thomson Works
of Art Limited and The Woodbridge Company Limited (collectively, without the
Company, referred to as the "Parties" and, individually, as a "Party") has been
duly authorized, executed and delivered by each of the Parties and constitutes a
legal, valid and binding obligation of each Party, enforceable against each
Party, in accordance with its terms.
(x) The execution, delivery and performance of the
Amalgamation Agreement and the consummation of the transactions contemplated in
the Amalgamation Agreement and compliance by the Parties with their respective
obligations under the Amalgamation Agreement do not and will not, to the best of
our knowledge, whether with or without the giving of notice or passage of time
or both, conflict with or constitute a breach of, or default under, or result in
the
C-2
creation or imposition of any lien, charge or encumbrance upon the Securities to
be sold by 986269 or any property or assets of the Parties pursuant to any
material contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, license, lease or other agreement or instrument, known to us, to which any
of the Parties is a party or which any of the Parties may be bound, or to which
any of the property or assets of any of the Parties is subject except for such
conflicts, breaches, defaults, liens, charges or encumbrances that would not
result in a Shareholder Material Adverse Effect, nor will such action result in
any violation of the provisions of the charter or by-laws of any of the Parties,
or any applicable Canadian federal or provincial treaty, law, statute, rule or
regulation, or any judgment, order, writ or decree, known to us, of any Canadian
federal or provincial government, government instrumentality or court, domestic
or foreign, having jurisdiction over any of the Parties or any of their
respective properties.
(xi) No filing with, or consent, approval, authorization,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the
performance by either Xxxxxxxxxx xx 000000 of their respective obligations under
the Purchase Agreement, or in connection with the sale and delivery of the
Securities under the Purchase Agreement or the consummation of the transactions
contemplated by the Purchase Agreement, except (i) such as may have previously
been made or obtained or as may be required under the 1933 Act or state
securities laws or Canadian Securities Laws and (ii) such as have been obtained
under the laws and regulations of jurisdictions outside Canada and the United
States in which the Reserved Securities are offered.
In rendering such opinion, such counsel may rely, as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Selling Shareholder and public
officials. Such counsel may also rely as to matters involving the application of
laws of any jurisdiction other than the Province of Ontario or the Federal laws
of Canada, to the extent they deem proper and specified in such opinion, upon
the opinion of other counsel who are reasonably satisfactory to counsel for the
Underwriters.
C-3
Exhibit D
June 11, 2002
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxx Xxxxxxx & Co. Incorporated
as Representatives of the several Underwriters (as defined below)
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Proposed Public Offering by The Thomson Corporation
Dear Sirs:
The undersigned, [a shareholder and/or an officer and/or a director] of
The Thomson Corporation, an Ontario corporation (the "Company"), understands
that the Underwriters propose to enter into a purchase agreement (the "Purchase
Agreement") with the Company and the Selling Shareholder providing for the
public offering of common shares of the Company (the "Common Shares"). In
recognition of the benefit that such an offering will confer upon the
undersigned as [a shareholder and/or a director and/or an officer] of the
Company, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with each
Underwriter that, during a period of 90 days from the date of the Purchase
Agreement, the undersigned will not, without the prior written consent of the
Representatives, directly or indirectly, or through any company controlled by
the undersigned, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant for the sale of, lend or otherwise dispose of or transfer any
of the Common Shares or any securities convertible into or exchangeable or
exercisable for Common Shares, whether now owned or hereafter acquired by the
undersigned or with respect to which the undersigned has or hereafter acquires
the power of disposition, or request or demand the filing of any registration
statement under the 1933 Act or prospectus under Canadian Securities Laws with
respect to any of the foregoing, (ii) enter into any swap or any other agreement
or any transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of the Common Shares, whether any such
swap or transaction is to be settled by delivery of Common Shares or other
securities, in cash or otherwise or (iii) publicly announce its intention to
enter into the transactions described under clauses (i) and (ii).
The foregoing shall not apply to any transfers or other dispositions of
Common Shares to members of the family of the undersigned, trusts established
for their benefit or corporations all the shares of which are directly or
indirectly owned by one or more of such family members or trusts (collectively,
the "Permitted Transferees") provided that if a Permitted Transferee is not a
company controlled by the undersigned, then, prior to such transfer or other
disposition, the Permitted Transferee shall have delivered to the Underwriters
an undertaking similar to that given herein.
Capitalized terms used herein shall, unless otherwise defined, have the
meanings ascribed thereto in the Purchase Agreement.
Very truly yours,
Signature: ___________________________
[Name of shareholder/director/officer]
D-1
Annex A
LIST OF THOMSON SUBSIDIARIES
Thomson Canada Limited Ontario, Canada
Thomson U.S. Holdings Inc. Delaware, U.S.A.
THI (U.S.) Inc. Delaware, U.S.A.
Thomson U.S. Inc. Delaware, U.S.A.
The Thomson Corporation Delaware Inc. Delaware, U.S.A.
Thomson Newspapers Holding Corp. Delaware, U.S.A.
National Education Corporation Delaware, U.S.A.
NETg, Inc. Nevada, U.S.A.
Thomson Financial Inc. New York, U.S.A.
West Publishing Company Minnesota, U.S.A.
West Publishing Corporation Minnesota, U.S.A.
Thomson Learning Inc. Delaware, U.S.A.
Thomson Professional & Regulatory Inc. Texas, U.S.A.
The Dialog Corporation Delaware, U.S.A.
Medical Economics Company Inc. Florida, U.S.A.
Prometric Inc. Maryland, U.S.A.
The Xxxx Group Inc. Delaware, U.S.A.
Institute for Scientific Information Inc. Pennsylvania, U.S.A.
Thomson Holdings Inc. Delaware, U.S.A.
The MEDSTAT Group, Inc. Delaware, U.S.A.
Thomson Holdings SA Luxembourg
Drake Beam Xxxxx, Inc Delaware, U.S.A.
Thomson Finance S.A. Luxembourg
The Thomson Corporation PLC England
The Thomson Organisation Ltd. England
TTCI (1994) Limited England
Thomson Information & Publishing Holdings Ltd. England
Thomson Information & Solutions Ltd England
Thomson Financial Ltd. England
Datastream International Ltd England
Annex A-1
TABLE OF CONTENTS
PURCHASE AGREEMENT
Page
----
SECTION 1. Representations and Warranties................................. 4
(A) Representations and Warranties by the Company.................... 4
(a) Final Receipt; Effectiveness; No Stop Order................. 4
(b) Compliance with U.S. and Canadian Securities Laws........... 5
(c) Financial Statements........................................ 6
(d) No Material Adverse Change in Business...................... 7
(e) Good Standing of the Company and Subsidiaries............... 7
(f) Capitalization.............................................. 8
(g) Due Authorization........................................... 8
(h) Absence of Defaults and Conflicts........................... 8
(i) Absence of Further Requirements............................. 9
(j) Registration Rights......................................... 9
(B) Representations and Warranties by the Selling Shareholder........ 9
(a) Accurate Disclosure......................................... 10
(b) Authorization of Agreements................................. 10
(c) Good and Marketable Title................................... 11
(d) Tax Reporting............................................... 11
(e) Absence of Manipulation..................................... 11
(f) Absence of Further Requirements............................. 11
(g) Restriction on Sale of Securities........................... 12
(h) Certificates Suitable for Transfer.......................... 12
(i) No Association with NASD.................................... 12
SECTION 2. Sale and Delivery to Underwriters; Closing..................... 13
(a) Initial Securities.......................................... 13
(b) Option Securities........................................... 13
(c) Payment..................................................... 13
(d) Denominations; Registration................................. 14
(e) Appointment of Qualified Independent Underwriters........... 15
SECTION 3. Covenants of the Company....................................... 15
(a) Compliance with Securities Regulations and Commission
Requests.................................................... 15
(b) Filing of Amendments........................................ 16
(c) Delivery of Filed Documents................................. 16
(d) Blue Sky Qualifications..................................... 17
(e) Rule 158.................................................... 17
(f) Use of Proceeds............................................. 17
(g) Restriction on Sale of Securities........................... 17
(h) Delivery of Opinion......................................... 18
(i) Listing..................................................... 18
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(j) Compliance with NASD Rules.................................. 18
(k) Reserved Securities......................................... 19
SECTION 4. Payment of Expenses............................................ 20
(a) Expenses.................................................... 20
(b) Termination of Agreement.................................... 20
(c) Allocation of Expenses...................................... 21
SECTION 5. Conditions of Underwriters' Obligations........................ 21
(a) Effectiveness of Registration Statement and Qualification of
Canadian Prospectus......................................... 21
(b) Opinions of Counsel for Company............................. 21
(c) Opinion of Counsel for the Selling Shareholder.............. 22
(d) Opinion of U.S. Counsel for Underwriters.................... 22
(e) Opinion of Canadian Counsel for Underwriters................ 22
(f) No Material Adverse Change.................................. 22
(g) Officers' Certificate....................................... 23
(h) Certificate of Selling Shareholder.......................... 23
(i) Accountants' Comfort Letter................................. 23
(j) Bring-down Comfort Letter................................... 24
(k) Approval of Listing......................................... 24
(l) No Objection................................................ 24
(m) Lock-up Agreements.......................................... 24
(n) Conditions to Purchase of Option Securities................. 24
(o) Additional Documents........................................ 25
(p) Termination of Agreement.................................... 25
SECTION 6. Indemnification................................................ 26
(a) Indemnification of Underwriters............................. 26
(b) Indemnification of Company, Directors and Officers and
Selling Shareholder......................................... 27
(c) Actions against Parties; Notification....................... 28
(d) Settlement without Consent if Failure to Reimburse.......... 29
(e) Indemnification for Reserved Securities..................... 29
(f) Other Agreements with Respect to Indemnification............ 30
SECTION 7. Contribution................................................... 30
SECTION 8. Representations, Warranties and Agreements to Survive Delivery. 31
SECTION 9. Termination of Agreement....................................... 31
(a) Termination; General........................................ 31
(b) Liabilities................................................. 32
SECTION 10. Default by One or More of the Underwriters.................... 32
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SECTION 11. Default by the Selling Shareholder or the Company............. 33
SECTION 12. Agent for Service; Submission to Jurisdiction; Waiver of
Immunities.................................................... 33
SECTION 13. Judgment Currency............................................. 34
SECTION 14. Notices....................................................... 34
SECTION 15. Parties....................................................... 34
SECTION 16. GOVERNING LAW AND TIME........................................ 35
SECTION 17. Effect of Headings............................................ 35
SECTION 18. Counterparts.................................................. 35
SCHEDULES
Schedule A - List of Underwriters................................... Sch A-1
Schedule B - List of Selling Shareholder............................ Sch B-1
Schedule C - Pricing Information.................................... Sch C-1
Schedule D - Persons Subject to Lock-up Agreements.................. Sch D-1
EXHIBITS
Exhibit A - Form of Opinion of Company's Canadian Counsel........... A-1
Exhibit B - Form of Opinion of Company's U.S. Counsel............... B-1
Exhibit C - Form of Opinion of Selling Shareholder's Counsel........ C-1
Exhibit D - Form of Lock-up Letter.................................. D-1
ANNEX
Annex A - List of Thomson Subsidiaries.............................. Annex A-1
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