EXHIBIT 10.4
SUN MEDIA CORPORATION
as Borrower
- and -
THE FINANCIAL INSTITUTIONS IDENTIFIED
ON THE SIGNATURE PAGES HERETO
as Lenders
- and -
BANC OF AMERICA SECURITIES LLC
as Joint Lead Arranger and Joint Bookrunner
BANK OF AMERICA, N.A.
as Administrative Agent and Issuing Lender
- and -
CREDIT SUISSE FIRST BOSTON
as Joint Lead Arranger, Joint Bookrunner and Syndication Agent
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FACILITY A - C$75,000,000
TERM FACILITY B - US$230,000,000
CREDIT AGREEMENT
February 7, 2003
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XXXXXX XXXXXXX LLP
MONTREAL TORONTO
0000 Xxxx-Xxxxxxxx Xxxx. Xxxx Xxxxx Bank Plaza, South Tower
Suite 2500 Suite 2600
Montreal (Quebec) H3B 4Y1 Xxxxxxx, Xxxxxxx, X0X 0X0
Telephone: (000) 000-0000 (000) 000-0000
Fax: (000) 000-0000 (000) 000-0000
TABLE OF CONTENTS
ARTICLE 1. INTERPRETATION..............................................................................01
SECTION 1.01 DEFINED TERMS...............................................................................01
SECTION 1.02 GENDER AND NUMBER...........................................................................29
SECTION 1.03 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC................................................29
SECTION 1.04 CURRENCY....................................................................................29
SECTION 1.05 CERTAIN PHRASES, ETC........................................................................29
SECTION 1.06 ACCOUNTING TERMS............................................................................29
SECTION 1.07 NON-BUSINESS DAYS...........................................................................30
SECTION 1.08 RATEABLE PORTION OF ACCOMMODATIONS..........................................................30
SECTION 1.09 INCORPORATION OF SCHEDULES..................................................................30
ARTICLE 2. CREDIT FACILITY.............................................................................30
SECTION 2.01 AVAILABILITY................................................................................30
SECTION 2.02 COMMITMENTS AND FACILITY LIMITS.............................................................30
SECTION 2.03 USE OF PROCEEDS.............................................................................31
SECTION 2.04 MANDATORY REPAYMENTS AND REDUCTIONS OF COMMITMENTS..........................................32
SECTION 2.05 MANDATORY PREPAYMENTS.......................................................................32
SECTION 2.06 OPTIONAL PREPAYMENTS AND REDUCTIONS OF COMMITMENTS..........................................33
SECTION 2.07 FEES........................................................................................34
SECTION 2.08 PAYMENTS UNDER THIS AGREEMENT...............................................................34
SECTION 2.09 APPLICATION OF PAYMENTS AND PREPAYMENTS.....................................................34
SECTION 2.10 CASH COLLATERALIZATION OF CERTAIN PAYMENTS AND PREPAYMENTS..................................35
SECTION 2.11 COMPUTATIONS OF INTEREST AND FEES...........................................................35
ARTICLE 3. ADVANCES....................................................................................36
SECTION 3.01 THE ADVANCES................................................................................36
SECTION 3.02 PROCEDURE FOR ADVANCES......................................................................37
SECTION 3.03 LIBOR ADVANCES..............................................................................38
SECTION 3.04 MARKET FOR LIBOR ADVANCES...................................................................38
SECTION 3.05 SUSPENSION OF LIBOR ADVANCE OPTION..........................................................38
SECTION 3.06 LIMITS ON LIBOR ADVANCES....................................................................38
SECTION 3.07 CONVERSIONS OF ADVANCES.....................................................................38
SECTION 3.08 INTEREST ON PRIME RATE ADVANCES.............................................................38
SECTION 3.09 INTEREST ON US PRIME RATE ADVANCES..........................................................39
SECTION 3.10 INTEREST ON LIBOR ADVANCES..................................................................39
ARTICLE 4. BANKERS' ACCEPTANCES........................................................................40
SECTION 4.01 ACCEPTANCES AND DRAFTS......................................................................40
SECTION 4.02 FORM OF DRAFTS..............................................................................41
SECTION 4.03 PROCEDURE FOR DRAWING.......................................................................41
SECTION 4.04 SIGNATURES OF DRAFT FORMS...................................................................41
SECTION 4.05 PAYMENT, CONVERSION OR RENEWAL OF BA INSTRUMENTS............................................42
SECTION 4.06 CIRCUMSTANCES MAKING BANKERS' ACCEPTANCES UNAVAILABLE.......................................42
SECTION 4.07 DEPOSITORY BILLS AND NOTES ACT..............................................................42
ARTICLE 5. LETTERS OF CREDIT...........................................................................43
SECTION 5.01 LETTERS OF CREDIT...........................................................................43
SECTION 5.02 REIMBURSEMENTS OF AMOUNTS DRAWN.............................................................44
SECTION 5.03 RISK OF LETTERS OF CREDIT...................................................................44
SECTION 5.04 REPAYMENTS..................................................................................46
SECTION 5.05 APPLICABILITY OF ISP98 AND UCP..............................................................47
SECTION 5.06 CONFLICT WITH LETTER OF CREDIT APPLICATION..................................................47
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ARTICLE 6. CONDITIONS OF LENDING.......................................................................47
SECTION 6.01 CONDITIONS PRECEDENT TO THE INITIAL ACCOMMODATION...........................................47
SECTION 6.02 CONDITIONS PRECEDENT TO ALL ACCOMMODATIONS AND CONVERSIONS..................................50
SECTION 6.03 NO WAIVER...................................................................................50
ARTICLE 7. REPRESENTATIONS AND WARRANTIES..............................................................51
SECTION 7.01 REPRESENTATIONS AND WARRANTIES..............................................................51
(A) INCORPORATION AND QUALIFICATION......................................................51
(B) CORPORATE POWER......................................................................51
(C) CONFLICT WITH OTHER INSTRUMENTS......................................................51
(D) AUTHORIZATION, GOVERNMENTAL APPROVALS, ETC...........................................51
(E) EXECUTION AND BINDING OBLIGATION.....................................................52
(F) CONDUCT OF BUSINESS..................................................................52
(G) LOCATION OF BUSINESS.................................................................52
(H) AUTHORIZATIONS, ETC..................................................................52
(I) TRADEMARKS, PATENTS, ETC.............................................................53
(J) OWNERSHIP OF PROPERTY................................................................53
(K) LEASED PROPERTIES....................................................................53
(L) EXPROPRIATION........................................................................53
(M) ENCROACHMENTS........................................................................53
(N) COMPLIANCE WITH LAWS.................................................................53
(O) SUBSIDIARIES, ETC....................................................................54
(P) NO BURDENSOME AGREEMENTS.............................................................54
(Q) NO LITIGATION........................................................................54
(R) PENSION PLANS AND EMPLOYMENT LIABILITIES.............................................54
(S) MATERIAL AGREEMENTS..................................................................54
(T) FINANCIAL STATEMENTS.................................................................54
(U) BOOKS AND RECORDS....................................................................55
(V) INSURANCE............................................................................55
(W) SOLVENCY.............................................................................55
(X) TAX LIABILITY........................................................................55
(Y) CORPORATE STRUCTURE..................................................................55
(Z) CONTINGENT OBLIGATIONS AND INDEBTEDNESS..............................................56
(AA) DISCLOSURE...........................................................................56
SECTION 7.02 SURVIVAL OF REPRESENTATIONS AND WARRANTIES..................................................56
ARTICLE 8. COVENANTS OF THE BORROWER...................................................................56
SECTION 8.01 AFFIRMATIVE COVENANTS.......................................................................56
(A) FINANCIAL REPORTING REQUIREMENTS.....................................................56
(B) ENVIRONMENTAL REPORTING..............................................................57
(C) ADDITIONAL REPORTING REQUIREMENTS....................................................58
(D) CORPORATE EXISTENCE..................................................................58
(E) COMPLIANCE WITH LAWS, ETC............................................................58
(F) MAINTENANCE OF PROPERTIES, ETC.......................................................58
(G) STATUS OF ACCOUNTS AND COLLATERAL....................................................59
(H) CONDUCT OF BUSINESS AND HEDGING REQUIREMENTS.........................................59
(I) ENVIRONMENTAL AUDITS.................................................................59
(J) AUDITORS.............................................................................59
(K) PAYMENT OF TAXES AND CLAIMS..........................................................59
(L) KEEPING OF BOOKS.....................................................................59
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(M) VISITATION AND INSPECTION............................................................59
(N) MAINTENANCE OF INSURANCE.............................................................60
(O) CURE DEFECTS, PRESERVATION OF SECURITY...............................................60
(P) FURTHER ASSURANCES...................................................................60
SECTION 8.02 NEGATIVE COVENANTS..........................................................................60
(A) DEBT.................................................................................61
(B) ENCUMBRANCES.........................................................................61
(C) MERGERS, ETC.........................................................................61
(D) DISPOSAL OF ASSETS GENERALLY.........................................................61
(E) TRANSACTIONS WITH AFFILIATES.........................................................62
(F) CHANGE IN BUSINESS...................................................................62
(G) SHARE CAPITAL........................................................................62
(H) DISTRIBUTIONS........................................................................62
(I) LOANS, INVESTMENTS AND ACQUISITIONS..................................................63
(J) RENTAL OBLIGATIONS...................................................................63
(K) SUBSIDIARIES.........................................................................63
(L) MAINTENANCE AND OWNERSHIP OF SUBSIDIARIES............................................63
(M) CAPITAL EXPENDITURES.................................................................63
(N) BUSINESS OUTSIDE CERTAIN JURISDICTIONS...............................................64
(O) FINANCIAL YEAR.......................................................................64
(P) AMENDMENTS...........................................................................64
SECTION 8.03 FINANCIAL COVENANTS.........................................................................64
(A) LEVERAGE RATIO.......................................................................64
(B) INTEREST COVERAGE RATIO..............................................................64
(C) FIXED CHARGE COVERAGE RATIO..........................................................65
ARTICLE 9. EVENTS OF DEFAULT...........................................................................65
SECTION 9.01 EVENTS OF DEFAULT...........................................................................65
SECTION 9.02 REMEDIES UPON DEMAND AND DEFAULT............................................................68
SECTION 9.03 BANKRUPTCY AND INSOLVENCY...................................................................68
SECTION 9.04 RELATIONS WITH THE BORROWER.................................................................68
SECTION 9.05 APPLICATION OF PROCEEDS.....................................................................69
ARTICLE 10. THE ADMINISTRATIVE AGENT AND THE LENDERS....................................................69
SECTION 10.01 AUTHORIZATION AND ACTION....................................................................69
SECTION 10.02 NO LIABILITY................................................................................70
SECTION 10.03 ACCOMMODATIONS BY ADMINISTRATIVE AGENT......................................................71
SECTION 10.04 HOLDING OF SECURITY, SHARING OF PAYMENTS, ETC...............................................71
SECTION 10.05 LENDER CREDIT DECISIONS.....................................................................73
SECTION 10.06 DELEGATION..................................................................................73
SECTION 10.07 INDEMNIFICATION.............................................................................73
SECTION 10.08 LIABILITY OF THE LENDERS INTER SE...........................................................73
SECTION 10.09 SUCCESSOR ADMINISTRATIVE AGENT..............................................................73
SECTION 10.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM...............................................74
SECTION 10.11 REPLACEMENT OF SCHEDULE II REFERENCE LENDERS................................................75
SECTION 10.12 IRREVOCABLE POWER OF ATTORNEY (FONDE DE POUVOIR)............................................75
ARTICLE 11. CURRENCY AND EXCHANGE.......................................................................75
SECTION 11.1 RULES AND CONVERSION........................................................................75
SECTION 11.2 DETERMINATION OF AN EQUIVALENT CURRENCY.....................................................76
ARTICLE 12. MISCELLANEOUS...............................................................................76
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SECTION 12.01 AMENDMENT...................................................................................76
SECTION 12.02 WAIVER......................................................................................77
SECTION 12.03 EVIDENCE OF DEBT AND ACCOMMODATION NOTICES..................................................77
SECTION 12.04 NOTICES, ETC................................................................................77
SECTION 12.05 CONFIDENTIALITY.............................................................................78
SECTION 12.06 COSTS, EXPENSES AND INDEMNITY...............................................................78
SECTION 12.07 TAXES.......................................................................................80
SECTION 12.08 SUCCESSORS AND ASSIGNS......................................................................81
SECTION 12.09 FACILITY A LENDER BECOMING NON-RESIDENT.....................................................83
SECTION 12.10 RIGHT OF SET-OFF............................................................................83
SECTION 12.11 ACCOMMODATIONS BY LENDERS...................................................................84
SECTION 12.12 RATEABLE PAYMENTS...........................................................................84
SECTION 12.13 INTEREST ON ACCOUNTS........................................................................84
SECTION 12.14 GOVERNING LAW...............................................................................84
SECTION 12.15 CONSENT TO JURISDICTION.....................................................................85
SECTION 12.16 COUNTERPARTS................................................................................85
SECTION 12.17 SEVERABILITY................................................................................85
SECTION 12.18 ASSIGNMENT TO FEDERAL RESERVE BANK..........................................................85
SECTION 12.19 GOOD FAITH AND FAIR CONSIDERATION...........................................................86
SCHEDULES
SCHEDULES
SCHEDULE 1 - FORM OF ACCOMMODATION NOTICE
SCHEDULE 2 - FORM OF REPAYMENT NOTICE
SCHEDULE 3 - OFFER TO TERM LENDERS
SCHEDULE 4 - APPLICABLE MARGINS
SCHEDULE 5 - SECURITY AND SECURITY DOCUMENTS
SCHEDULE 6 - ASSIGNMENT AGREEMENT
SCHEDULE 7 - GUARANTORS
SCHEDULE 8 - SUBORDINATION AGREEMENT
SCHEDULE 9 - FORM OF NOTE
DISCLOSURE SCHEDULES
SCHEDULE 6.01(J) REAL PROPERTY OF LOAN PARTIES TO BE MORTGAGED
SCHEDULE 7.01(A) JURISDICTION OF INCORPORATION OF BORROWER, ITS SUBSIDIARIES
SCHEDULE 7.01(G) LOCATION OF BUSINESS AND OF MINUTE BOOKS OF LOAN PARTIES
SCHEDULE 7.01(I) INTELLECTUAL PROPERTY
SCHEDULE 7.01(J) OWNED PROPERTIES
SCHEDULE 7.01(K) LEASED PROPERTIES
SCHEDULE 7.01(O) MINORITY INTERESTS
SCHEDULE 7.01(R) PENSION PLANS
SCHEDULE 7.01(S) MATERIAL AGREEMENTS
SCHEDULE 7.01(Y) CORPORATE STRUCTURE
CREDIT AGREEMENT entered into in the City of Montreal, Province of
Quebec, as
of February 7, 2003
AMONG:
SUN MEDIA CORPORATION, a corporation continued and existing under the laws of
British Columbia, Canada, having its chief executive office at 000 Xxxx Xxxxxx
Xxxx, in the City of Toronto, Province of Ontario (hereinafter called the
"BORROWER")
PARTY OF THE FIRST PART
AND: THE FINANCIAL INSTITUTIONS NAMED ON THE SIGNATURE PAGES HEREOF OR FROM TIME
TO TIME PARTIES HERETO (the "LENDERS")
PARTIES OF THE SECOND PART
AND: BANK OF AMERICA, N. A., AS ADMINISTRATIVE AGENT FOR THE LENDERS, a duly
constituted bank, having a place of business at 000 Xxxxx Xxxxxx, 00xx floor,
in the City of Xxx Xxxxxxx, Xxxxxxxxxx, 00000, and at 000 Xxxxx Xxxxxx Xxxx,
Xxxxx 0000, Xxxxxxx, Xxxxxxx, X0X 0X0 (hereinafter called the "ADMINISTRATIVE
AGENT")
PARTY OF THE THIRD PART
WHEREAS the Borrower wishes to borrow certain amounts from the
Lenders and the Lenders have agreed to lend such amounts to the Borrower,
subject to and in accordance with the provisions hereof;
NOW THEREFORE the parties hereto, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
hereby covenant and agree as follows.
ARTICLE 1
INTERPRETATION
SECTION 1.01. DEFINED TERMS. As used in this
Agreement, the following terms have the following meanings:
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"ACCOMMODATION" means (i) an Advance made by a Lender; (ii)
the creation and purchase of Bankers' Acceptances or the purchase of
completed Drafts by a Lender or by any other Person on the occasion of any
Drawing; and (iii) the creation, issue, extension of expiry date, renewal or
increase of Letters of Credit by an Issuing Lender (each of which is a "TYPE"
of Accommodation).
"ACCOMMODATION NOTICE" means a Borrowing Notice or a
Drawing Notice, as the case may be.
"ACCOMMODATIONS OUTSTANDING" means, at any time, the
principal amount owed to the Lenders under the Credit Facilities, and, more
specifically, (i) under Facility A, in relation to (a) the Borrower and all
Facility A Lenders, the amount of all Accommodations outstanding thereunder
at such time made to the Borrower by the Facility A Lenders, and (b) the
Borrower and each Facility A Lender, the amount of all Accommodations
outstanding at such time made by such Facility A Lender under its Facility A
Commitment; (ii) in respect of Swingline Advances, in relation to the
Borrower and the Swingline Lender, the Accommodations outstanding at such
time made to the Borrower by the Swingline Lender; (iii) in respect of
Letters of Credit, in relation to the Borrower and the Issuing Lender, the
Face Amount of all Letters of Credit outstanding at such time issued by the
Issuing Lender to the Borrower; and (iv) under Term Facility B, in relation
to (a) the Borrower and all Term Lenders, the amount of all Accommodations
outstanding thereunder at such time made to the Borrower by the Term Lenders,
and (b) the Borrower and each Term Lender, the amount of all Accommodations
outstanding at such time made by such Term Lender under its Term Credit
Commitment. In determining Accommodations Outstanding, the aggregate amount
thereof shall be determined on the basis of (i) in the case of all Credit
Facilities, the aggregate principal amount of all Advances; and (ii) in the
case of Facility A, an amount equal to the aggregate of the principal amount
of all Swingline Advances, the Face Amount of all Letters of Credit for which
the Facility A Lenders are contingently liable pursuant to Section 3.01(2)
and Section 5.02(2), as the case may be, and the Face Amount of all
outstanding BA Instruments which any applicable Lender has purchased or
arranged to have purchased (and in respect of each Facility A Lender, a
rateable part of such amounts).
"ACQUISITION" means, with respect to any Person, any
transaction or series of related transactions for the direct or indirect (i)
acquisition of all or substantially all of the Assets or a business or
division of any other Person; (ii) acquisition of any shares, interests,
participations or other equivalents (including partnership interests); or
(iii) reconstruction, reorganization, consolidation, amalgamation,
winding-up, merger, transfer, sale, lease or other combination with any other
Person; and "ACQUIRE" and "ACQUIRED" have meanings correlative thereto.
"ADDITIONAL DISTRIBUTIONS" means an amount of up to
$37,500,000 in the aggregate during the entire term of the Credit Facility
available to be paid to
Quebecor Media Inc. or one of its subsidiaries up to
the expiry of the Term of Facility A, in addition to the payment thereto of
the permitted percentage of Excess Cash Flow as set out in the definition of
"Permitted Distributions", provided that the remaining (unused) Facility A
Commitment available under Facility A after making any such payment would be
at least $25,000,000.
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"ADMINISTRATIVE AGENT" means, Bank of America, N.A. as
administrative agent for the Lenders under this Agreement, with assistance
from Bank of America, N.A., Canada Branch, and any successor appointed
pursuant to Section 10.09.
"ADVANCES" means advances of funds in Canadian Dollars made
by a Facility A Lender under Facility A, and advances in US$ by way of Libor
Advances and US Prime Rate Advances made by a Term Lender under Term Facility
B, all in accordance with Article 3, and "ADVANCE" means any one of such
advances. Advances made or to be made available by the Swingline Lender
pursuant to Article 3 are sometimes referred to as "SWINGLINE ADVANCES".
"AFFILIATE" has the meaning specified in the CANADA
BUSINESS CORPORATIONS ACT on the date of this Agreement, and, with respect to
any Lender that is a fund that invests in bank loans, means any other fund
that invests in bank loans and is advised or managed by the same investment
advisor as such Lender or by an Affiliate of such investment advisor.
"AGENCY BRANCH ACCOUNT" means, (a) for all of the Facility A
Lenders, the account at the branch of the Administrative Agent located at 000
Xxxxx Xxxxxx Xxxx, Xxxxx 0000, in the City of Toronto, Province of Ontario,
M5V 3L2, Wiring - "DIRECT through "LVTS" to: Bank of America N. A., Canada
Branch, TRANSIT #: 56792- 241, Account #00000000, SWIFT CODE: XXXXXXXX,
Reference: Sun Media. Att'n: Loans Processing, or such other account or
address in Canada of which the Agent may notify the Borrower from time to
time; and (b) for all of the Term Lenders, the account at the Agent's office
located at Bank of America, N. A., 0000 Xxxxxxx Xxxx., 0xx Xxxxx, XX:
CA4-706-05-09, Xxxxxxx, XX 00000, Phone: (000) 000-0000, Fax: (000) 000-0000,
E-mail: xxxxxxxx.x.xxxxxxxx@xxxxxxxxxxxxx.xxx, wiring instructions Bank of
America, N. A., ABA #: 000-000-000, Acct. #: 37508-36479, Ref:
Sun Media
Corp., or such other account or address in the U.S.A. of which the
Administrative Agent may notify the Borrower from time to time.
"AGENT-RELATED PERSONS" means the Administrative Agent,
together with its Affiliates (including, in the case of Bank of America in
its capacity as the Administrative Agent, Banc of America Securities LLC as
joint Arranger), and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and Affiliates.
"AGREEMENT" means this
credit agreement and all schedules
and instruments in amendment or confirmation of it; and the expressions
"ARTICLE" and "SECTION" followed by a number mean and refer to the specified
Article or Section of this Agreement.
"ANNUAL BUSINESS PLAN" means, for any Financial Year, (i)
detailed pro-forma balance sheets, income statements and statements of
changes in the Borrower's and its subsidiaries' financial position, prepared
in accordance with GAAP (to the extent applicable), in respect of such
Financial Year and each Financial Quarter therein for the Borrower and its
subsidiaries' consolidated operations and supported by appropriate
explanations, notes and information; (ii) detailed pro-forma balance sheets,
income statements and statements of changes in the Borrower's and its
subsidiaries' financial position in respect of, and as at the last day of,
each of the next two following Financial Years, prepared in accordance with
GAAP (to the extent applicable) for the
4
Borrower's and its subsidiaries' consolidated operations and supported by
appropriate explanations, notes and information and commentary; (iii) details
of any Capital Expenditures, including the nature and type of same, to be
made in such Financial Year; and (iv) a narrative of the Business for the
Financial Year then ended, all as approved by the Borrower's board of
directors.
"APPLICABLE COMMITMENT FEE" means, in respect of Facility
A, the Commitment Fees set out and defined in Schedule 4 corresponding to the
applicable Leverage Ratio. The Applicable Commitment Fee shall be adjusted on
the date the Administrative Agent receives the relevant Compliance
Certificate calculating the Leverage Ratio. If at any time any Compliance
Certificate is not delivered on the applicable due date, without prejudice to
the rights of the Lenders in respect of such Default, the Borrower shall pay
Commitment Fees set out in Tier I of the relevant table in Schedule 4 from
the date such Compliance Certificate was due until it is delivered.
"APPLICABLE MARGINS" means, at any time, subject to the
next following sentence, the margins set forth and defined in Schedule 4
corresponding, with respect to Facility A, to the Leverage Ratio at such
time. In respect of (i) Canadian Prime Rate Advances, the Applicable Margin
shall be the margin referred to in the column "C$ PRIME RATE ADVANCES"; (ii)
Drawings and Letters of Credit, the Applicable Margin shall be the margin
referred to in the column "BA DRAWING FEE AND LETTER OF CREDIT FEE", subject,
with respect to Letters of Credit, to the fee payable to the Issuing Lender
as contemplated by Section 5.01, (iii) Libor Advances, the Applicable Margin
shall be the margin referred to in the column "LIBOR", and (iv) US Prime Rate
Advances, the Applicable Margin shall be the margin referred to in the column
"US$ PRIME RATE ADVANCES". On the Closing Date, each Applicable Margin in
respect of Facility A shall be deemed to be that set out in Tier II of the
relevant table in Schedule 4, and thereafter, shall be adjusted on the date
the Administrative Agent receives the relevant Compliance Certificate
calculating the Leverage Ratio. If at any time any Compliance Certificate is
not delivered on the applicable due date, without prejudice to the rights of
the Lenders in respect of such Default, the Applicable Margin shall be that
set out in Tier I of the relevant table in Schedule 4 from the date such
Compliance Certificate was due until the date on which it is delivered.
If at the time of a change in the BA Drawing Fee, there exist any outstanding
Drawings of the Borrower under Facility A, the Borrower shall pay to the
Administrative Agent, for the rateable benefit of the Facility A Lenders (in
the case of an increase in the BA Drawing Fee) or receive repayment or credit
from the Lenders (in the case of a decrease in the BA Drawing Fee) for, an
amount in respect of each such Drawing equal to the product obtained by
multiplying (i) the product obtained by multiplying (w) the difference
between the BA Drawing Fee in effect prior to such change and the BA Drawing
Fee in effect immediately after such change, by (x) the aggregate face amount
of such Drawing, by (ii) the quotient obtained by dividing (y) the number of
days to maturity remaining in respect of such Drawing, by (z) 365 days. Any
payment as a result of a change in the Applicable Margin shall be made, in
respect of Drawings, on the next maturity date thereof in accordance with
Article 4.
"APPROVED FUND" means any Fund that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.
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"ARM'S LENGTH" has the meaning ascribed thereto for the
purposes of the INCOME TAX ACT (Canada), as in effect as of the date hereof.
"ASSETS" means, with respect to any Person, all property,
rights, assets and undertakings of such Person of every kind, tangible and
intangible, and wheresoever situate, whether now owned or hereafter acquired.
"ASSIGNEE" has the meaning specified in Section 12.08(3).
"AUTHORIZATION" means, with respect to any Person, any
authorization, order, permit, approval, grant, licence, consent, right,
franchise, privilege, certificate, judgment, writ, injunction, award,
determination, direction, decree, by-law, rule or regulation of any
Governmental Entity having jurisdiction over such Person.
"BACK-TO-BACK DEBT" means any loans made or debt
instruments issued as part of a Back-to-Back Transaction and in which each
party to such Back-to-Back Transaction, other than a Loan Party, executes a
subordination agreement in favor of the Administrative Agent in substantially
the form attached hereto as Schedule 8.
"BACK-TO-BACK PREFERRED SHARES" means preferred shares
issued:
(a) to a Loan Party by an Affiliate of the Borrower in circumstances
where, immediately prior to the issuance of such preferred shares, an
Affiliate of such Loan Party has loaned on an unsecured basis to such
Loan Party, or an Affiliate of such Loan Party has subscribed for
preferred shares of such Loan Party in an amount equal to, the
requisite subscription price for such preferred shares;
(b) by a Loan Party to one of its Affiliates in circumstances where,
immediately prior to or immediately after, as the case may be, the
issuance of such preferred shares, such Loan Party has loaned an
amount equal to the proceeds of such issuance to an Affiliate on an
unsecured basis; or
(c) by a Loan Party to one of its Affiliates in circumstances
where, immediately after the issuance of such preferred shares, such
Loan Party has used all of the proceeds of such issuance to
subscribe for preferred shares issued by an Affiliate;
in each case on terms whereby:
(i) the aggregate redemption amount applicable to the preferred
shares issued to or by such Loan Party is identical:
(A) in the case of (a) above, to the principal amount of
the loan made or the aggregate redemption amount of the
preferred shares subscribed for by such Affiliate prior to
the issuance thereof;
(B) in the case of (b) above, to the principal amount
of the loan made to such Affiliate with the proceeds of the
issuance thereof; or
6
(C) in the case of (c) above, to the aggregate redemption
amount of the preferred shares issued by such Affiliate
with the proceeds of the issuance thereof;
(ii) the dividend payment date applicable to the preferred
shares issued to or by such Loan Party will:
(A) in the case of (a) above, be immediately prior to the
interest payment date relevant to the loan made or the
dividend payment date on the preferred shares subscribed
for by such Affiliate immediately prior to the issuance
thereof;
(B) in the case of (b) above, be immediately after the
interest payment date relevant to the loan made to such
Affiliate with the proceeds of the issuance thereof; or
(C) in the case of (c) above, be immediately after the
dividend payment date on the preferred shares issued by
such Affiliate with the proceeds of the issuance thereof;
(iii) the amount of dividends provided for on any payment date in
the share conditions attaching to the preferred shares
issued:
(A) to a Loan Party in the case of (a) above, will be equal to
or in excess of the amount of interest payable in respect of
the loan made or the amount of dividends provided for in
respect of the preferred shares subscribed for by such
Affiliate prior to the issuance thereof;
(B) by a Loan Party in the case of (b) above, will be equal
to or less than the amount of interest payable in respect of
the loan made to such Affiliate with the proceeds of the
issuance thereof; or
(C) by a Loan Party in the case of (c) above, will be equal
to the amount of dividends in respect of the preferred
shares issued by such Affiliate with the proceeds of the
issuance thereof.
Provided, for greater certainty, that in all cases, (I) the
redemption of any preferred shares by a Loan Party, (II) the
repayment of any Back-to-Back Debt by a Loan Party, (III) the
payment of any dividends by a Loan Party in respect of its preferred
shares, and (IV) the payment of any interest on Back-to-Back Debt of
a Loan Party, may, in each case, be made by a Loan Party solely by
delivering the relevant Back-to-Back Securities to the Affiliate in
question, or by paying to the Affiliate an amount in cash not in
excess of the amount already received in cash from such Affiliate.
"BACK-TO-BACK SECURITIES" means the Back-to-Back Preferred
Shares or the Back-to-Back Debt or both, as the context requires.
"BACK-TO-BACK TRANSACTIONS" means any of the transactions
described under the definition of Back-to-Back Preferred Shares.
"BANKERS' ACCEPTANCE" has the meaning specified in Section
4.01.
"BA EQUIVALENT NOTE" has the meaning specified in Section
4.03(3).
7
"BA INSTRUMENTS" means, collectively, Bankers' Acceptances,
Drafts and BA Equivalent Notes, and, in the singular, any one of them.
"BANKING DAY" means any day which is at the same time a
Business Day and a day on which dealings in US Dollar deposits are conducted
by and between banks in the London interbank eurodollar market.
"BORROWER" means
Sun Media Corporation, and its successors
and permitted assigns.
"BORROWING NOTICE" has the meaning specified in Section
3.02.
"BUILDINGS AND FIXTURES" means all plants, buildings,
structures, erections, improvements, appurtenances and fixtures (including
fixed machinery and fixed equipment) situate on the Owned Properties and
Leased Properties.
"BUSINESS" means, with respect to the Borrower and its
subsidiaries, the business of publishing, distributing and selling
newspapers, shoppers or other publications, internet, cable and other news
media business and the business of commercial printing and any business
complementary thereto or an extension thereof.
"BUSINESS DAY" means any day of the year, other than a
Saturday, Sunday or other day on which banks are required or authorized to
close in, or are in fact closed in, (a) with respect to matters pertaining
exclusively to Accommodations and repayments under Facility X, Xxxxxxx,
Xxxxxxx, or (b) with respect to all other matters, (i) Toronto, Ontario, and
(ii) California, U.S.A. or such other State in which the Administrative
Agent's office is located from time to time.
"CANADIAN DOLLARS" and "CDN. $" each means lawful money of
Canada.
"CANADIAN PRIME RATE" means, at any time, the rate of
interest per annum equal to the greater of (i) the rate which the principal
office of the Administrative Agent in Toronto, Ontario quotes, publishes and
refers to as its "PRIME RATE" and which is its reference rate of interest for
demand commercial loans in Canadian Dollars to Canadian borrowers; and (ii)
the average rate for Canadian Dollar bankers' acceptances having a term of
one month that appears on the Reuters Screen CDOR Page (or such other page as
is a replacement page for such bankers' acceptances) as of 10:00 a.m.
(Toronto time) on the date of determination, as reported by the
Administrative Agent, plus 1.00%, adjusted automatically with each quoted,
published or displayed change in such rate, all without necessity of any
notice to the Borrower or any other Person.
"CAPITAL EXPENDITURES" means expenditures made for the
purchase, lease or acquisition of assets (other than current assets) required
to be capitalized in accordance with GAAP, other than expenditures in
connection with Permitted Acquisitions.
8
"CASH EQUIVALENTS" means
1. United States Dollars or Canadian Dollars;
2. investments in securities with maturities of one year or
less from the date of acquisition issued or fully
guaranteed by any state, commonwealth, territory or
province of the United States of America or Canada, or
by any political subdivision or taxing authority
thereof, and rated in the "R-1" category by the Dominion
Bond Rating Service Limited;
3. certificates of deposit and eurodollar time deposits
with maturities of one year or less from the date of
acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each
case, with any domestic commercial bank having capital
and surplus in excess of US$500.0 million;
4. repurchase obligations with a term of not more than
seven days for underlying securities of the types
described in clauses (2) and (3) above entered into with
any financial institution meeting the qualifications
specified in clause (3) above;
5. commercial paper having the highest rating obtainable
from Xxxxx'x Investors Service, Inc. or Standard &
Poor's Rating Services and in each case maturing within
one year after the date of acquisition or with respect
to commercial paper in Canada, a rating in the "R-1"
category from the Dominion Bond Rating Service Limited;
and
6. money market funds at least 90% of the assets of which
constitute Cash Equivalents of the kinds described in
clauses (1) through (5) of this definition.
"CHANGE OF CONTROL" means the occurrence of one or more of
the following events (whether or not approved by the board of directors of
any such Person): (i) any Person or related group of Persons acting in
concert shall at any time be, directly or indirectly, the beneficial owner of
a greater percentage of the votes attaching to
Quebecor Media Inc.'s
securities entitled to vote generally in an election of
Quebecor Media Inc.'s
directors than the percentage of such votes beneficially owned by
Quebecor or
the Peladeau Group at such time; (ii) the designees of
Quebecor or the
Peladeau Group shall cease to represent the largest group of designees of any
Person or group of Persons acting in concert on the board of directors of
Quebecor Media Inc., or the said board is or becomes controlled by any other
shareholder; (iii) any Person or related group of Persons acting in concert
shall at any time be, directly or indirectly, the beneficial owner of a
greater percentage of the votes attaching to the Borrower's securities
entitled to vote generally in an election of the Borrower's directors than
the percentage of such votes beneficially owned by
Quebecor and
Quebecor
Media Inc. at such time; or (iv) the designees of Quebecor or Quebecor Media
Inc. shall cease to constitute a majority of the board of directors of the
Borrower.
9
"CLAIM" means any claim of any nature whatsoever, including
any demand, liability, obligation, cause of action, suit, proceeding,
judgment, award, assessment and reassessment.
"CLOSING DATE" means February 7, 2003.
"COLLATERAL" means the Assets of the Borrower or any of its
subsidiaries in respect of which any Lender has or will have a Security
Interest pursuant to a Security Document.
"COMMITMENT" means, at any time, in respect of (i) Facility
A, Cdn.$75,000,000 (the "FACILITY A COMMITMENT"), which includes the
Swingline Advances up to an amount of Cdn.$5,000,000 (the "SWINGLINE
COMMITMENT") and Letters of Credit up to an amount of Cdn.$2,000,000; and
(ii) Term Facility B, US$230,000,000 (the "TERM CREDIT COMMITMENT"), in each
case, as such amount may be decreased pursuant to Article 2. A "LENDER'S
FACILITY A COMMITMENT", a "SWINGLINE LENDER'S COMMITMENT" and a "LENDER'S
TERM CREDIT COMMITMENT" means, at any time, the relevant amount designated as
such and set forth opposite such Lender's name on the signature pages hereof.
"COMPLIANCE CERTIFICATE" means a certificate of the
Borrower signed on its behalf by its chief financial officer, controller,
treasurer, or any other officer acceptable to the Administrative Agent, (i)
stating that any financial statements delivered by it pursuant to Section
8.01(a) present fairly the financial position, results of operations and
changes in financial position of the Borrower in accordance with GAAP; (ii)
stating that the representations and warranties in Article 7 are true and
correct in all material respects on and as of such date; (iii) stating that
the Borrower is not in breach of any of the covenants contained in Article 8
as at the date thereof (or describing the details of any subsisting breach);
(iv) stating that no Default has occurred and is continuing and that no Event
of Default has occurred (or describing the details of any subsisting Default
and the action which the Borrower proposes to take or has taken with respect
thereto or any Event of Default); and (v) providing, in reasonable detail,
evidence of compliance, at the end of each Financial Quarter, with Section
8.03 and evidencing the calculation of the financial covenants in Section
8.03 applicable at such time.
"CONSOLIDATED DEBT" means, for any Person, the aggregate of
all Debt of such Person and its subsidiaries, determined in accordance with
GAAP.
"CONSOLIDATED EBITDA" means, for any Person, for any period
and without duplication, earnings of such Person on a consolidated basis
before non-controlling interests, extraordinary items, Consolidated Interest
Charges, foreign exchange translation gains or losses not involving the
payment of cash, amortization of deferred financing costs and other non-cash
financial charges, taxes, depreciation and amortization, less any income
received in connection with Back-to-Back Securities, and without taking into
account any goodwill adjustments, calculated on a consolidated basis, and
otherwise calculated in accordance with GAAP.
"CONSOLIDATED FIXED CHARGES" means, for any Person, for any
period, the aggregate of (i) Consolidated Interest Charges, (ii) all
scheduled principal payments on account of Consolidated Debt, but excluding,
for greater certainty, the amount of the prepayment of the
10
Existing Notes and the Existing
Credit Agreement, to the extent either (a)
prepaid and cancelled on the Closing Date, or (b) that all amounts payable
thereunder, whether for obligations due or to become due, have been
irrevocably paid on the Closing Date to the trustee or agent thereunder, as
the case may be, such that no such trustee or agent, nor any noteholder or
lender under the Existing Notes and the Existing
Credit Agreement, as the
case may be, shall have any further claim in respect of such Debt against the
Borrower or its subsidiaries, the Existing Notes shall be cancelled within 30
to 60 days following the Closing Date, and the Existing
Credit Agreement
shall be cancelled not more than 15 days following the Closing Date (for the
purposes hereof, such payment and cancellation or provision of payment is
herein called "DEFEASANCE"), (iii) actual Capital Expenditures made by the
Person and its subsidiaries, in each case, for such period (to the extent
made from internally generated funds), and (iv) taxes paid in cash during
such period, net of any tax recovery and without duplication of any such
recovery.
"CONSOLIDATED INTEREST CHARGES" means, for any Person, for
any period for the Person and its subsidiaries, the sum of, without
duplication, (i) all items properly classified as interest expense in
accordance with GAAP (other than amounts paid in respect of (A) the
Back-to-Back Transactions, including under the Existing Back-to-Back
Securities, (B) any non-cash foreign exchange gains or losses recognized in
relation to foreign currency denominated Debt and (C) the amortization of
deferred financing cost), (ii) the imputed interest component of any element
of Consolidated Debt (such as capital leases) which would not be classified
as interest expense pursuant to (i), and (iii) the aggregate of all purchase
discounts relating to the sale of (a) bankers acceptances or other
instruments sold at a discount, and (b) accounts receivable in connection
with any asset securitization program, all as determined at such time in
accordance with GAAP.
"CONTINGENT OBLIGATIONS" of any Person means all contingent
liabilities required to be included in the financial statements of such
Person in accordance with GAAP, excluding any notes thereto.
"CREDIT DOCUMENTS" means this Agreement, the BA
Instruments, the Letters of Credit, the Security Documents, the Hedging
Agreements, the subordination agreements in respect of Back-to-Back
Securities and all other documents (including guarantees) to be executed and
delivered to the Administrative Agent, the Issuing Lender or the Lenders or
their Affiliates, or all of them, by the Borrower or the Guarantors in
connection with the Credit Facilities, as well as all documents to be
executed and delivered in connection with the Overdraft Facility.
"CREDIT FACILITIES" means, collectively, Facility A and
Term Facility B, and, in the singular any one of them.
"DEBENTURES" has the meaning attributed to it in Schedule 5.
"DEBT" of any Person means, at any time, without
duplication, (i) all indebtedness for borrowed money including borrowings of
commodities, bankers' acceptances, letters of credit or letters of guarantee;
for the purposes of calculating the amount of Debt denominated in US $, the
Borrower shall use the exchange rate contemplated in the Hedging Agreements
entered into in
11
connection with the Hedging Requirements up to the extent to which such US $
denominated Debt is covered by such Hedging Agreements, (ii) obligations in
respect of the Negative Value of Hedging Agreements, but without duplication
of any underlying Debt that may be hedged by same, and without taking into
account the currency hedging in respect of the US $ denominated Debt referred
to in paragraph (i) above, (iii) all indebtedness for the deferred purchase
price of property or services, whether or not represented by a note or other
evidence of indebtedness, other than such obligations incurred in the
ordinary course of the Person's business, and payable within a period not
exceeding 150 days from the date of their incurrence, (iv) all indebtedness
created or arising under any conditional sale or other title retention
agreement with respect to property acquired by the Person (even though the
rights and remedies of the seller or lender under such agreement in the event
of default are limited to repossession or sale of such property), (v) all
indebtedness of another Person secured by a Lien created or assumed by the
Person on any properties or assets of the Person, (vi) Contingent
Obligations, (vii) all obligations under leases which have been or should be,
in accordance with GAAP, recorded as capital leases or Synthetic Leases in
respect of which the Person is liable as lessee, (viii) the aggregate amount
at which any shares in the capital of the Person which are redeemable or
retractable at the option of the holder may be retracted or redeemed for cash
or Debt (provided all conditions precedent for such retraction or redemption
have been satisfied), and (ix) all Debt Guaranteed by the Person; but shall
not include (a) the Back-to-Back Securities and the Existing Back-to-Back
Securities, and (b) provided that Defeasance has occurred, the Existing Notes
and the Existing
Credit Agreement.
"DEBT GUARANTEED" by any Person means the maximum amount
which may be outstanding at any time of all Debt of the kinds referred to in
(i) through (viii) of the definition of Debt which is directly or indirectly
guaranteed by the Person or which the Person has agreed (contingently or
otherwise) to purchase or otherwise acquire, or in respect of which the
Person has otherwise assured a creditor or other Person against loss.
"DEFAULT" means an event which, with the giving of notice
or passage of time, or both, would constitute an Event of Default.
"DEFEASANCE" has the meaning attributed to it in the
definition of "Consolidated Fixed Charges".
"DESIGNATED PERIOD" means, with respect to a Libor Advance,
a period designated by the Borrower in accordance with Section 3.03.
"DISPOSITION" means with respect to any Asset of any
Person, any direct or indirect sale, lease (where such Person is the lessor
of such Asset), assignment, cession, transfer (including any transfer of
title or possession), exchange, conveyance, release, gift, including by means
of a sale-leaseback transaction, reorganization, consolidation, amalgamation
or merger; and "DISPOSE" and "DISPOSED" have meanings correlative thereto.
"DISTRIBUTION" means, in respect of any Person, (i) any
dividend or other distribution on issued shares of such Person, (ii) the
purchase, redemption or retirement amount of any issued shares, warrants or
any other options or rights to acquire shares of the Person redeemed
12
or purchased by the Person, (iii) any payment made on, under, or in respect
of any Debt (other than Debt under this Agreement or payments required to be
made pursuant to the provisions of any pension plan of such Person in effect
from time to time), including interest, sinking fund or any like payment, and
(iv) any other payment made to an Affiliate of such Person unless such
payment is permitted under Section 8.02(e).
"DRAFT" means, at any time, (i) a xxxx of exchange, within
the meaning of the BILLS OF EXCHANGE ACT (Canada), drawn by the Borrower on a
Lender or any other Person and bearing such distinguishing letters and
numbers as the Lender or the Person may determine, but which at such time has
not been completed as to the payee by the Lender or the Person; or (ii) a
depository xxxx within the meaning of the DEPOSITORY BILLS AND NOTES ACT
(Canada).
"DRAWING" means (i) the creation and purchase of Bankers'
Acceptances by a Lender or by any other Person pursuant to Article 4; or (ii)
the purchase of completed Drafts by a Lender or by any other Person pursuant
to Article 4.
"DRAWING DATE" means any Business Day fixed for a Drawing
pursuant to Section 4.03.
"DRAWING FEE" means, with respect to each Bankers'
Acceptance or Draft drawn by the Borrower and purchased by any Person on any
Drawing Date, an amount equal to the Applicable Margin, multiplied by the
product of (i) a fraction, the numerator of which is the number of days,
inclusive of the first day and exclusive of the last day, in the term of
maturity of such Bankers' Acceptance or Draft, and the denominator of which
is 365 or 366, as the case may be, and (ii) the aggregate face amount of the
Bankers' Acceptance or Draft.
"DRAWING NOTICE" has the meaning specified in Section
4.03(1).
"DRAWING PRICE" means, in respect of Bankers' Acceptances
or Drafts purchased by a Facility A Lender or any other Person, the result
obtained by multiplying (a) the aggregate Face Amount of the Bankers'
Acceptances or Drafts by (b) the amount (rounded up or down to the fifth
decimal place with .000005 being rounded up) determined by dividing one by
the sum of one plus the product of (x) the Reference Discount Rate, and (y) a
fraction the numerator of which is the number of days to maturity of the
Bankers' Acceptances or Drafts and the denominator of which is 365.
"DRAWING PROCEEDS" means, in respect of any Bankers'
Acceptance or Draft purchased by a Lender or any other Person, an amount
equal to (i) the Drawing Price in respect of such Bankers' Acceptance or
Draft; minus (ii) the applicable Drawing Fee in respect of such Bankers'
Acceptance or Draft.
"ENVIRONMENTAL LAWS" means all applicable Laws relating to
the environment, health and safety matters or conditions, Hazardous
Substances, pollution or protection of the environment, including Laws
relating to (i) on site or off-site contamination; (ii) occupational health
and safety relating to Hazardous Substances; (iii) chemical substances or
products; (iv)
13
Releases of pollutants, contaminants, chemicals or other industrial, toxic or
radioactive substances or Hazardous Substances into the environment; and (v)
the manufacture, processing, distribution, use, treatment, storage, transport
or handling of Hazardous Substance.
"ENVIRONMENTAL LIABILITIES AND COSTS" means all Losses and
Claims under applicable Environmental Laws, whether known or unknown, current
or potential, past, present or future, imposed by, under or pursuant to
Environmental Laws or otherwise relating to any Environmental Law, including
all Losses and Claims related to Remedial Actions and all reasonable fees,
disbursements and expenses of counsel, experts, personnel and consultants,
where such Losses and Claims are based on, arise out of or are otherwise in
respect of (i) the ownership or operation of the Business or any Assets
related to the Business; (ii) the conditions on, under, above or about any
real property, assets, equipment or facilities currently or previously owned,
leased or operated by the Borrower or any of its subsidiaries; (iii)
expenditures necessary to cause the operations of the Business or Assets
either related to the Business or owned, leased or operated by the Borrower
or any of its subsidiaries to comply materially with any and all
environmental requirements, including expenditures in connection with
obtaining all Environmental Permits; (iv) expenditures necessary to effect
the environmental closure, environmental decommissioning or environmental
rehabilitation of any of the operations of the Business or Assets either
related to the Business or owned, leased or operated by the Borrower or any
of its subsidiaries; (v) liability for personal injury or property damage,
including damages assessed for the maintenance of a public or private
nuisance; and (vi) any other matter affecting the Owned Properties, the
Leased Properties or other Assets of the Borrower or any of its subsidiaries
relating to any Environmental law or otherwise within the jurisdiction of any
Governmental Entity administering any Environmental Law.
"ENVIRONMENTAL NOTICE" means any claim, citation,
directive, request for information, statement of claim, notice of
investigation, letter or other communication, written or oral, actual or
threatened, from any Person to the Borrower or any of its subsidiaries
relating to any Environmental Laws.
"ENVIRONMENTAL PERMITS" includes all permits, certificates,
approvals, registrations and licences issued by any Governmental Entity to
the Borrower or any of its subsidiaries or to the Business pursuant to
Environmental Laws and required for the operation of the Business or the use
of the Owned Properties, Leased Properties or other Assets of the Borrower or
any of its subsidiaries.
"EVENT OF DEFAULT" has the meaning specified in Section
9.01.
"EXCESS CASH FLOW" means, for the Borrower, calculated at
the end of each quarter on a four quarter trailing basis (as set out in
Section 8.02(h)(2)), the sum of (i) Consolidated EBITDA of the Borrower; (ii)
any spread paid to the Borrower resulting from Back-to-Back Securities or
Existing Back-to-Back Securities, to the extent not previously included in
Consolidated EBITDA; LESS THE AGGREGATE for such period of (a) Consolidated
Interest Charges (excluding accrued interest paid on the Existing Notes and
the Existing
Credit Agreement) paid in cash and not accrued; (b) taxes paid
in cash, net of recoveries and without duplication of same; (c)
14
Capital Expenditures paid in cash made by the Borrower and its subsidiaries;
and (d) all regularly scheduled payments and all voluntary prepayments of the
Borrower's and its subsidiaries' Debt (other than (A) payments under the
Existing Notes and the Existing
Credit Agreement, to the extent Defeasance
has occurred on the Closing Date; (B) voluntary repayments under Facility A
and the Overdraft Facility; and (C) voluntary repayments made using the
proceeds of permitted Dispositions of Assets, Permitted Debt described in
clauses (ii), (viii) and (x) of such definition, and the issuance of equity
securities), and minus the amount of extraordinary items not included in
earnings but which required the payment of cash. Notwithstanding the fact
that Excess Cash Flow is calculated on a four-quarter trailing basis, Excess
Cash Flow for the Financial Quarter ending (a) March 31, 2003, shall be
calculated based on the Excess Cash Flow in that Financial Quarter alone; (b)
June 30, 2003, shall be calculated based on the Excess Cash Flow in that
Financial Quarter and in the preceding Financial Quarter of 2003; (c)
September 30, 2003 shall be calculated based on the Excess Cash Flow in that
Financial Quarter and in the two preceding Financial Quarters of 2003; and
(d) December 31, 2003, shall be calculated based on the Excess Cash Flow in
the last four Financial Quarters.
"EXCESS CASH FLOW CERTIFICATE" has the meaning specified in
Section 8.01(a).
"EXISTING BACK-TO-BACK DEBT" means each of the 12.15%
Convertible Obligation due July 14, 2007 and 12.15% Convertible Obligation
due November 28, 2008 of the Borrower; the 12.25% Convertible Obligation due
July 14, 2007 of Xxxxx Publishers Limited; and the 12.25% Convertible
Obligation due November 28, 2008 of Sun Media (Toronto) Corporation, in each
case in aggregate principal amount outstanding on the Closing Date, with
respect to which each party thereto, other than a Loan Party, has executed a
subordination agreement in favour of the Administrative Agent for the Lenders
in substantially the form attached as Schedule 8.
"EXISTING BACK-TO-BACK SECURITIES" means the Existing
Back-to-Back Debt and the Existing Quebecor Preferred Shares.
"EXISTING QUEBECOR PREFERRED SHARES" means the 12.50%
Cumulative First Preferred Shares, Series A, of Quebecor Media Inc. in
aggregate liquidation amount outstanding on the Closing Date.
"EXISTING
CREDIT AGREEMENT" means the existing credit
agreement among the Borrower and, INTER ALIA, Royal Bank of Canada as
Administrative Agent dated as of April 1, 2000, as amended, which is to be
the object of a Defeasance at Closing.
"EXISTING NOTES" means the existing senior subordinated notes
in an aggregate amount of approximately US$151,000,000 issued by the Borrower
and designated as "9-1/2% Senior Subordinated Notes due 2007", which are to be
the object of a Defeasance at Closing.
"FACE AMOUNT" means (i) in respect of a BA Instrument, the
amount payable to the holder on its maturity; and (ii) in respect of a Letter
of Credit, the maximum amount which the Issuing Lender is contingently liable
to pay to the beneficiary thereof.
15
"FACILITY A" means the revolving credit facility in an
amount of up to Cdn.$75,000,000 to be made available to the Borrower under
this Agreement for the purposes specified in Section 2.03.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a
fluctuating interest rate per annum equal, for each day during such period,
to the weighted average of the rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by Federal Funds brokers
as published for such day (or, if such day is not a Business Day, for the
immediately preceding Business Day) by the Federal Reserve Bank of New York
or, for any day on which such rate is not so published for such day by the
Federal Reserve Bank of New York, the average of the quotations for such day
for such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by the Administrative Agent. If
for any reason the Administrative Agent shall have determined (which
determination shall be conclusive, absent manifest error) that it is unable
to ascertain the Federal Funds Effective Rate for any reason, including
without limitation, the inability or failure of the Agent to obtain
sufficient bids or publications in accordance with the terms hereof, Bank of
America N.A.'s announced US Prime Rate will apply.
"FEES" means the fees payable by the Borrower under this
Agreement.
"FINANCIAL QUARTER" means, in respect of any Person, a
period of three consecutive months in each Financial Year of such Person
ending on March 31, June 30, September 30, and December 31, as the case may
be, of such year.
"FINANCIAL YEAR" means, in respect of any Person, its
financial year commencing on January 1 of each calendar year and ending on
December 31 of the same calendar year.
"FIXED CHARGE COVERAGE RATIO" means the ratio of
Consolidated EBITDA to Consolidated Fixed Charges, calculated in the manner
prescribed in Section 8.03(c) at such time.
"FLORIDA SUN" has the meaning attributed to it in the
definition of "Permitted Distribution".
"FUND" means any Person (other than a natural person) that
is (or will be) engaged in making, purchasing, holding or otherwise investing
in commercial loans and similar extensions of credit in the ordinary course
of its business.
"GAAP" means, at any time, accounting principles generally
accepted in Canada as recommended in the Handbook of the Canadian Institute
of Chartered Accountants at the relevant time applied on a consistent basis
(except for changes approved by the Borrower's independent auditors in
accordance with promulgations of the Canadian Institute of Chartered
Accountants).
"GOVERNMENTAL ENTITY" means any (i) multinational, federal,
provincial, state, municipal, local or other government, governmental or
public department, central bank, court, commission, board, bureau, agency or
instrumentality, domestic or foreign, (ii) any subdivision or
16
authority of any of the foregoing, or (iii) any quasi-governmental or private
body exercising any regulatory, expropriation or taxing authority under or
for the account of any of the above.
"GUARANTORS" means each of the subsidiaries of the Borrower
as at the Closing Date other than Le Courrier du Sud (1998) Inc., all of
which are listed in Schedule 7 hereof, as well as each additional subsidiary
of the Borrower created or acquired after the Closing Date. Notwithstanding
the foregoing, a subsidiary of the Borrower which (i) is not wholly-owned,
directly or indirectly, by the Borrower, and (ii) the aggregate of whose
EBITDA or Assets, when considered together with the EBITDA or Assets of all
other subsidiaries that are not Guarantors, does not exceed 10% of the EBITDA
or Assets of the Borrower on a consolidated basis, shall not be required to
become a Guarantor for so long as the conditions set out in clauses (i), and
(ii) continue to apply; for the purposes hereof, "Assets" excludes the effect
of all Back-to-Back Transactions.
"HAZARDOUS SUBSTANCE" means any substance, waste, liquid,
gaseous or solid matter, fuel, micro-organism, sound, vibration, ray, heat,
odour, radiation, energy, plasma and organic or inorganic matter, alone or in
any combination which is regulated under any applicable Environmental Laws,
hazardous, hazardous waste, toxic, a pollutant, a deleterious substance, a
contaminant or a source of pollution or contamination under any Environmental
Law.
"HEDGING AGREEMENTS" means one or more agreements between
the Borrower and one or more of the Lenders or their Affiliates evidencing
(i) any interest rate hedge (including any interest rate swap, cap or
collars); or (ii) any foreign exchange hedge, as may be contemplated by the
Hedging Requirements or otherwise.
"HEDGING REQUIREMENTS" means Hedging Agreements implemented
by the Borrower hedging (i) its interest rate risk relating to its
Consolidated Debt in a notional principal amount necessary to ensure that at
least 35% of its Consolidated Debt is fixed rate Debt for a minimum period of
three years from the Closing Date; and (ii) its foreign exchange risk
relating to the Senior Notes (or any notes issued in replacement thereof) and
Term Facility B in a notional principal amount equal to 90% of the aggregate
principal amount of such notes and such Credit Facility and based on the term
to maturity of the Senior Notes and Term Facility B.
"HOLDCO" means 3535991 Canada Inc.
"IMPERMISSIBLE QUALIFICATION" means, relative to the
opinion or report of any independent auditors as to any financial statement,
any qualification or exception to such opinion or report which (i) is of a
"going concern" or similar nature; (ii) relates to any limited scope of
examination of material matters relevant to such financial statement, if such
limitation results from the refusal or failure of the Borrower to grant
access to necessary information therefor; and (iii) relates to the treatment
or classification of any item in such financial statement and which, as a
condition to its removal, would require an adjustment to such item the effect
of which could reasonably be expected to have a Material Adverse Effect.
"INDEMNIFIED PERSON" has the meaning specified in Section
12.06(1).
17
"INTEREST COVERAGE RATIO" means the ratio of Consolidated
EBITDA to Consolidated Interest Charges, calculated in the manner prescribed
in Section 8.03(b) at such time.
"INVESTMENTS" means all investments, in cash or by delivery
of property, made directly or indirectly in any Person, whether by
acquisition of shares of capital stock, Indebtedness or other obligations or
securities or by loan, advance, capital contribution, guarantees or
otherwise, and includes any Acquisition; PROVIDED, HOWEVER, that
"Investments" shall not mean or include investments in cash or Cash
Equivalents or routine investments in inventory, equipment and supplies to be
used or consumed, or trade credit granted, in the ordinary course of the
Business.
"ISSUING LENDER" has the meaning attributed to it in the
definition of "Letter of Credit". For the purposes hereof, the Issuing Lender
shall be Bank of America N.A., Canada Branch, unless such Issuing Lender no
longer wishes to act as such, in which case the provisions of Section 10.09
hereof shall apply, MUTATIS MUTANDIS, except that only the Facility A Lenders
(and not the Term Lenders) shall appoint such replacement Issuing Lender.
"ISDA MASTER AGREEMENT" means the 1992 ISDA Master
Agreement (Multi-Currency - Cross Border) as published by the International
Swaps and Derivatives Association, Inc. and, where the context permits or
requires, includes all schedules, supplements, annexes and confirmations
attached thereto or incorporated therein, as such agreement may be amended,
supplemented or replaced from time to time.
"JUDICIAL ORDER" has the meaning specified in Section
5.04(1).
"LAWS" means, all legally enforceable statutes, codes,
ordinances, decrees, rules, regulations, municipal by-laws, judicial or
arbitral or administrative or ministerial or departmental or regulatory
judgments, orders, decisions, rulings or awards, policies, voluntary
restraints, guidelines, or any provisions of the foregoing, including general
principles of common and civil law and equity, binding on or affecting the
Person referred to in the context in which such word is used; and "LAW" means
any one of the foregoing.
"LEASED PROPERTIES" means the real properties at the
municipal addresses listed in Schedule 7.01(k) forming the subject matter of
the Leases to which the Borrower or any of its subsidiaries is a party.
"LEASES" means the leases and subleases of real property to
which the Borrower or any of its subsidiaries is a party providing, in each
case, for annual rental payments in respect thereof of an amount greater than
$500,000, as listed and described in Schedule 7.01(k) and such other leases
and subleases to which the Borrower or any of its subsidiaries is a party
providing, in each case, for annual rental payments in respect thereof of an
amount greater than $500,000, as the Administrative Agent may, from time to
time, be notified by the Borrower.
18
"LENDERS" means, collectively, the financial institutions and
other Persons set forth on the signature pages hereof as Lenders, and any
Assignee thereof upon such Assignee executing and delivering an assignment and
assumption agreement referred to in Section 12.08(5) to the Borrower and the
Administrative Agent and in the singular any one of such Lenders. A Lender
which, at any relevant time, has (i) a Lender's Facility A Commitment is
sometimes referred to herein as a "FACILITY A LENDER"; (ii) a Swingline Lender's
Commitment is sometimes referred to herein as a "SWINGLINE LENDER"; (iii) a
Lender's Term Credit Commitment is sometimes referred to herein as a "TERM
LENDER". When used in connection with "Hedging Agreements", the term "Lender"
shall include any Affiliate of a Lender. When used in connection with the
Security, the term "Lender" shall include the provider of the Overdraft Facility
and any counterparty to a Hedging Agreement, provided that the counterparty was
a Lender or an Affiliate of a Lender, at the time any such Hedging Agreement was
entered into. Prior to the occurrence of any Event of Default which has not been
waived, each Facility A Lender shall not be a non-resident of Canada within the
meaning of the INCOME TAX ACT (Canada).
"LETTER OF CREDIT" means a Cdn. $ denominated letter of credit
or a letter of guarantee issued or to be issued by an Issuing Lender (an
"ISSUING LENDER") under Facility A for the account of the Borrower, issued in
the name of the Borrower or any of its subsidiaries pursuant to Article 5.
"LEVERAGE RATIO" means, at any time, the ratio of Consolidated
Debt of the Borrower and its subsidiaries to Consolidated EBITDA, calculated in
the manner prescribed in Section 8.03(a) at such time.
"LIBOR" means, with respect to any Designated Period
relating to a Libor Advance:
(a) the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate that appears on the page of
the Telerate screen (or any successor thereto) that displays an average
British Bankers Association Interest Settlement Rate for deposits in US
Dollars (for delivery on the first day of such Designated Period) with
a term equivalent to such Designated Period, determined as of
approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Designated Period, or
(b) if the rate referenced in the preceding clause (a) does not
appear on such page or service or such page or service shall not be
available, the rate per annum equal to the rate determined by the
Administrative Agent to be the offered rate on such other page or
other service that displays an average British Bankers Association
Interest Settlement Rate for deposits in US Dollars (for delivery on
the first day of such Designated Period) with a term equivalent to
such Designated Period, determined as of approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such
Designated Period, or
(c) if the rates referenced in the preceding clauses (a) and (b) are
not available, the rate per annum determined by the Administrative
Agent as the rate of interest at which deposits in US Dollars for
delivery on the first day of such Designated Period in same day
funds in the approximate amount of the Libor Advance being made,
continued
19
or converted by the Lender that is the Administrative Agent and with
a term equivalent to such Designated Period as would be offered by
the Lender that is the Administrative Agent's London Branch (or, if
it has none, Bank of America's London Branch) to major banks in the
London interbank eurodollar market at their request at approximately
4:00 p.m. (London time) two Business Days prior to the first day of
such Designated Period.
With respect to a Libor Advance to be made by a Lender which is subject to the
regulations issued from time to time by the Board of Governors of the Federal
Reserve System in the USA in respect of such Libor Advances, the rate determined
in paragraphs (a), (b) or (c) above (the "QUOTED RATE") shall be adjusted for
reserve requirements in accordance with the following formula to obtain the
applicable LIBOR:
LIBOR= QUOTED RATE
-------------------------
1.00 - Reserve Percentage
where "RESERVE PERCENTAGE" means the rate (expressed as a decimal) applicable to
the relevant Lender, during the relevant Designated Period under regulations,
directives or guidelines issued from time to time by the Board of Governors of
the Federal Reserve System (in the USA) or any successor thereof, for
determining the reserve requirement applicable to the Facility or to facilities
similar thereto (including any basic, supplemental, emergency or marginal
reserve requirement) of such Lender, respectively, with respect to "Eurocurrency
liabilities", as that term is defined under such regulations or for the purposes
of complying with such directives or guidelines. All adjustments to the Quoted
Rate shall occur and be effective as of the effective date of any change in the
Reserve Percentage, and the Administrative Agent will use reasonable efforts to
advise the Borrower of any such change as soon as practicable (provided that the
Administrative Agent shall not be liable if it fails to do so).
"LIBOR ADVANCE" means, at any time, the part of the Advances
in US$ under Term Facility B with respect to which the Borrower has chosen to
pay interest on the Libor Basis.
"LIBOR BASIS" means the basis of calculation of interest on
Libor Advances, or any part thereof, made in accordance with the provisions of
Section 3.10.
"LIEN" means liens, charges, mortgages, pledges, Security
Interests, adverse claims, defects of title, restrictions, deposit arrangements,
voting trusts, any other rights of third parties relating to any property and
any other lien of any kind.
"LOAN PARTIES" means the Borrower and the Guarantors.
"LOSS" means any loss whatsoever, whether direct or indirect,
including expenses, costs, damages, judgments, penalties, fines, charges,
claims, demands, liabilities and any and all legal fees and disbursements,
except any such loss representing loss of profit.
"MAJORITY LENDERS" means, at any time, Lenders whose
Commitments, taken together, are more than 50% of the aggregate amount of
the Commitments.
20
"MANDATORY BORROWING" has the meaning specified in Section
3.01(2).
"MANDATORY PREPAYMENT" has the meaning specified in Section
2.05.
"MATERIAL ADVERSE EFFECT" means, with respect to any event or
occurrence of whatever nature (including any adverse determination in any
litigation, arbitration or governmental investigation or proceeding), (a) a
material adverse effect on the Business, properties, prospects, condition
(financial or otherwise), assets, operations or income of the Borrower and its
subsidiaries, taken as a whole, (b) a material adverse effect on the ability of
the Borrower or any of the Guarantors, individually (to the extent material) and
taken as a whole, to perform any of their respective material obligations under
any of the Credit Documents to which they are a party, or (c) any impairment of
the validity, binding effect or enforceability of this Credit Agreement or any
material impairment of the rights, remedies or benefits available to the
Administrative Agent or any Lender under any material Credit Document.
"MATERIAL AGREEMENTS" means the agreements described in
Schedule 7.01(s) and such other agreements of which the Administrative Agent
may, from time to time, be notified by the Borrower, in each case where such
agreements are necessary to the Business and the absence of which would
reasonably be expected to have a Material Adverse Effect.
"NEGATIVE VALUE OF HEDGING AGREEMENTS" means the aggregate
amount that would be payable to all Persons by the Borrower on the date of
determination pursuant to Section 6(e)(ii)(2)(A) of each ISDA Master Agreement
between the Borrower and such Persons as if all hedging agreements under such
ISDA Master Agreements were being terminated on that day; provided that, with
respect to the Hedging Agreements between each Lender and the Borrower, each
Lender will determine Market Quotation (as such term is defined in the ISDA
Master Agreement) using its estimates at mid-market of the amounts that would be
paid for Replacement Transactions (as such term is defined in the ISDA Master
Agreement).
"NET PROCEEDS" means any one or more of the following (i) with
respect to any Disposition of Assets by the Borrower or any of its subsidiaries,
the net amount equal to the aggregate amount received in cash (including any
cash received by way of deferred payment pursuant to a note, receivable, other
non-cash consideration or otherwise, but only as and when such cash is so
received) in connection with such Disposition, less the sum of (x) amounts
payable to discharge or radiate Permitted Liens on the Assets being Disposed of,
(y) reasonable fees (including, without limitation, reasonable legal fees),
commissions and other out-of-pocket expenses incurred or paid for by the
Borrower or such subsidiary in connection with such Disposition, and (z) taxes
incurred in connection with such Disposition, whether payable at such time or
thereafter; (ii) with respect to the issuance or creation of Debt, whether
private or public, of any Person or any of its subsidiaries, the net amount
equal to the aggregate amount received in cash in connection with such creation
or issuance, less the reasonable fees (including without limitation, reasonable
legal fees), commissions and other out-of-pocket expenses incurred or paid for
by such Person or such subsidiary in connection with such creation or issuance;
and (iii) with respect to the issuance of any securities by any Person or of any
capital contributions by any Person in such
21
Person, the net amount equal to the aggregate amount received in cash in
connection with such issuance or contribution by any Person in such Person
less the reasonable fees (including without limitation, reasonable legal
fees), commissions and other out-of-pocket expenses, and without duplication;
but in each case excluding, as a deduction from amounts received, any amounts
paid to Affiliates.
"OVERDRAFT FACILITY" means a credit facility of which notice
has been provided by the Borrower to the Administrative Agent, available to the
Borrower from time to time from a reputable financial institution, in respect of
bank overdrafts (and letters of credit in respect thereof) in the ordinary
course of the Business, in an aggregate principal amount not exceeding
$5,000,000.
"OWNED PROPERTIES" means, collectively, the land and
premises listed on Schedule 7.01(j) and the Buildings and Fixtures thereon.
"PARTICIPANT" has the meaning specified in Section 12.08(3).
"PELADEAU GROUP" means any (i) individual who is related by
blood, adoption or marriage to the late Xxxxxx Xxxxxxxx, (ii) any trust (whether
testamentary or otherwise) the beneficiaries of which are all individuals
described in (i); or (iii) any corporation or partnership which is controlled,
directly or indirectly, by one or more individuals referred to in (i) or a trust
referred to in (ii), or any combination thereof.
"PERMITTED ACQUISITION" has the meaning ascribed to it in
the definition of "Permitted Investment".
"PERMITTED DEBT" means (i) the Senior Notes; (ii) Subordinated
Debt; (iii) Back-to-Back Securities and Existing Back-to-Back Securities (iv)
Debt owed by a Guarantor to the Borrower or vice versa, or by a Guarantor to any
other Guarantor; (v) obligations pursuant to the Hedging Agreements or other
hedging arrangements permitted hereunder; (vi) Debt secured by Purchase Money
Mortgages permitted hereunder; (vii) Debt in respect of Permitted Acquisitions
in a principal amount of up to $50,000,000 for each Permitted Acquisition for a
period of up to 90 days after the date such Permitted Acquisition was made;
(viii) additional Debt, not otherwise provided for herein, not in excess of
$50,000,000 outstanding at any time; (ix) indebtedness of the Borrower under the
Overdraft Facility ; and (x) any indebtedness incurred to refinance or replace
any of the foregoing other than under clause (vii) above; provided that with
respect to the Permitted Debt referred to in clauses (v), (vi), (vii) and
(viii), no Default shall have occurred and be continuing and no Event of Default
shall have occurred and not been waived at the time of the incurrence of such
Debt.
"PERMITTED DISTRIBUTION" means (i) the payment of an amount of
Cdn.$260,000,000 on or about the Closing Date, directly or indirectly, to
Quebecor Media Inc. by way of loans, dividends, return of capital or share
repurchases and the repayment of the Existing Notes and any interest or premium
in respect thereof and amounts owing under the Existing Credit Agreement; and
(ii) Distributions by a Guarantor to the Borrower or by a subsidiary of the
22
Borrower to any Guarantor or to the Borrower. In addition, provided that no
Event of Default has occurred which has not been waived by the Lenders,
"Permitted Distributions" shall also mean (a) payments on account of regularly
scheduled instalments of principal and interest on Permitted Debt (including a
premium and fees, if any, thereon), other than the Senior Notes or any
Subordinated Debt (b) regularly scheduled payments of interest on the Senior
Notes and on Subordinated Debt; (c) payments made in connection with or in
respect of the Back-to-Back Securities or the Existing Back-to-Back Securities;
provided, however, that to the extent such payments are made to any Affiliates
of the Borrower that are not Loan Parties, all corresponding payments required
to be paid by such Affiliates pursuant to the related Back-to-Back Securities or
Existing Back-to-Back Securities are received, immediately prior to,
concurrently with or immediately subsequent to any such payments, by all
applicable Loan Parties, and each such payment by a Loan Party shall be
conditional upon receipt of an equal or greater amount from such non-Loan Party
Affiliate; (d) any Tax Benefit Transaction; (e) the redemption or repayment of
up to $50,000,000 of Senior Notes (and, for greater certainty, no other
prepayment of the Senior Notes will be permitted, from any source (other than
new Subordinated Debt), without the consent of the Majority Lenders who have
Commitments at the time of any such proposed prepayment); (f) the payment of
Additional Distributions directly or indirectly to Quebecor Media Inc. by way of
loans, dividends, return of capital or share repurchase; (g) the payment of the
proceeds of the sale of Toronto Sun International Inc., its subsidiaries or all
or substantially all of their respective Assets (hereinafter, the "FLORIDA
SUN"), if the Disposition in question occurs within 60 days following the
Closing Date; (h) the payment of amounts required to be paid under the joint
Quebecor/Sun Media pension plan with respect to employees of the Loan Parties
alone; (i) the payment of a management fee or other similar expense by the
Borrower to its direct or indirect parent company for bona fide services
(including reimbursement for expenses incurred in connection with, or allocation
of corporate expenses in relation to, providing such services) provided to, and
directly related to the operations of, the Loan Parties, in an aggregate amount
not to exceed 1.25% of consolidated revenues (being gross revenues calculated in
accordance with GAAP less any amounts derived from subsidiaries that are not
Loan Parties, and save that any portion of such gross revenues derived from a
Person that is not a subsidiary of the Borrower accounted for by the equity
method of accounting shall be included in such calculation only to the extent of
the amount of dividends or distributions actually paid to a Loan Party by such
Person) in any twelve-month period; and (j) the payment out of Excess Cash Flow
of certain other amounts, directly or indirectly, to Quebecor Media Inc. by way
of loans, dividends, return of capital or share repurchases, the amount of which
shall not exceed an amount equal to 50% of the Excess Cash Flow reported at the
end of the previous Financial Quarter in the Excess Cash Flow Certificate until
such time as the Leverage Ratio reported in respect of the end of such previous
Financial Quarter is less than 3.00:1 (at which point the Permitted Distribution
will be up to 100% of Excess Cash Flow as long as the Leverage Ratio remains
less than 3.00:1), and subject to having first provided to the Administrative
Agent an Excess Cash Flow Certificate (as required by subsection 8.01 (a))
attesting as to the Excess Cash Flow in respect of the particular period in
question, and deducting therefrom any amount of Excess Cash Flow used to make a
Permitted Investment (such that the same amount of Excess Cash Flow cannot be
used both for a Permitted Distribution and a Permitted Investment). Each payment
of a Permitted Distribution of Excess Cash Flow shall be calculated and made
subject to and in accordance with the provisions of Section 8.02(h)(2) hereof.
23
"PERMITTED INVESTMENT" means (A) any Investment in
Back-to-Back Securities or Existing Back-to-Back Securities or in connection
with Tax Benefit Transactions and (B) (i) any Investment made out of the portion
of Excess Cash Flow available to the Borrower to make a Permitted Distribution
that is not used to make a Permitted Distribution; and (ii) any other
Investments (including any Acquisitions) in an aggregate amount of up to
$50,000,000 during the entire Term of the later to expire of Facility A or Term
Facility B (a "PERMITTED ACQUISITION") provided that after giving effect to such
Investment or Acquisition and any Accommodation made under the Credit Facilities
to fund all or any part of the purchase price of such Acquisition, no Default
shall have occurred and be continuing, and no Event of Default shall have
occurred and not been waived, and, for greater certainty, the Borrower will be
in compliance with the financial covenants set forth in Section 8.03.
"PERMITTED LIENS" means, in respect of any Person, any one
or more of the following:
(a) Liens for taxes, assessments or governmental charges or levies
which are not delinquent or the validity of which is being contested at
the time by the Person in good faith by proper legal proceedings if, in
the Administrative Agent's opinion, either (i) adequate provision has
been made for their payment, or (ii) the Liens are not in the aggregate
materially prejudicial to the security constituted by the Security
Documents;
(b) inchoate or statutory Liens of contractors, subcontractors,
mechanics, workers, suppliers, materialmen, carriers and others in
respect of construction, maintenance, repair or operation of assets of
the Person, provided that such Liens are related to obligations not due
or delinquent are not registered against title to any assets of the
Person and in respect of which adequate holdbacks are being maintained
as required by applicable law or such Liens are being contested in good
faith by appropriate proceedings and in respect of which there has been
set aside a reserve (segregated to the extent required by GAAP) in an
adequate amount and provided further that such Liens do not, in the
Administrative Agent's opinion, materially reduce the value of the
Assets of the Person or materially interfere with the use of such
Assets in the operation of the business of the Person;
(c) easements, rights-of-way, servitudes, restrictions and similar
rights in real property comprised in the Assets of the Person or
interests therein granted or reserved to other Persons, provided that
such rights do not, in the Administrative Agent's opinion, materially
reduce the value of the Assets of the Person or materially interfere
with the use of such Assets in the operation of the business of the
Person;
(d) title defects or irregularities which are of a minor nature and
which, in the Administrative Agent's opinion, do not materially reduce
the value of the Assets of the Person or materially interfere with
their use in the operation of the business of the Person;
(e) Liens securing appeal bonds and other similar Liens arising in
connection with court proceedings (including, without limitation,
surety bonds, security for costs of litigation
24
where required by law and letters of credit) or any other
instruments serving a similar purpose, which do not, in the
Administrative Agent's opinion, materially reduce the value of the
Assets of the Person or materially interfere with their use in the
operations of the business of the Person;
(f) attachments, judgments and other similar Liens arising in
connection with court proceedings; provided, however, that the Liens
are in existence for less than 10 days after their creation or the
execution or other enforcement of the Liens is effectively stayed or
the claims so secured are being actively contested in good faith and by
proper legal proceedings;
(g) the reservations, limitations, provisos and conditions, if any,
expressed in any original grant from the Crown of any real property or
any interest therein or in any comparable grant in jurisdictions other
than Canada, provided they do not, in the Administrative Agent's
opinion, materially reduce the value of the Assets of the Person or
materially interfere with the use of such Assets in the operation of
the business of the Person;
(h) Liens given to a public utility or any municipality or governmental
or other public authority when required by such utility or other
authority in connection with the operation of the business or the
ownership of the Assets of the Person, provided that such Liens do not,
in the Administrative Agent's opinion, materially reduce the value of
the Assets of the Person or materially interfere with their use in the
operation of the business of the Person;
(i) servicing agreements, development agreements, site plan agreements,
and other agreements with Governmental Entities pertaining to the use
or development of any of the Assets of the Person, provided same are
complied with and do not in the Administrative Agent's opinion,
materially reduce the value of the Assets of the Person or materially
interfere with their use in the operation of the business of the Person
including, without limitation, any obligations to deliver letters of
credit and other security as required;
(j) applicable municipal and other governmental restrictions, including
municipal by-laws and regulations, affecting the use of land or the
nature of any structures which may be erected thereon, provided such
restrictions have been complied with and do not in the Administrative
Agent's opinion, materially reduce the value of the Assets of the
Person or materially interfere with their use in the operation of the
business of the Person;
(k) the right reserved to or vested in any Governmental Entity by any
statutory provision or by the terms of any lease, licence, franchise,
grant or permit of the Person, to terminate any such lease, licence,
franchise, grant or permit, or to require annual or other payments as a
condition to the continuance thereof;
(l) Liens in favour of the Administrative Agent and the Lenders
created by the Security Documents;
25
(m) Liens in favour of a Lender securing amounts under the Hedging
Agreements in respect of the Hedging Requirements and other Hedging
Agreements entered into in accordance with the provisions of Section
8.02 (i) which rank, as to priority, PARI PASSU with the Accommodations
Outstanding and any other amounts owing hereunder;
(n) Liens granted by a Loan Party in favour of a Loan Party;
(o) a Lien of the interest of such Person in any non-wholly owned
partnership or corporation that is granted under the terms of the
partnership or shareholders agreement to secure the obligations of such
Person to the other partners or shareholders under that agreement,
provided that such Person has the benefit of a similar Lien over the
interests of the other partners or shareholders;
(p) Purchase Money Mortgages in an aggregate amount outstanding at
any time not exceeding $15,000,000;
(q) Liens to secure the Overdraft Facility;
(r) Liens to secure the Debt referred to in clause (viii) of the
definition of "Permitted Debt", up to an aggregate maximum outstanding
at any time not exceeding $25,000,000;
(s) Any rights of a landlord or sub-landlord under applicable Law or
the rights of a lessor or sub-lessor under an operating lease;
(t) Deposits to secure the performance of leases of property in the
ordinary course of business; and
(u) Any renewal, extension, substitution, replacement or refinancing
of the foregoing.
"PERSON" means a natural person, partnership, corporation,
joint stock company, trust, unincorporated association, joint venture or other
entity or Governmental Entity, and pronouns that have a similarly extended
meaning.
"PRIME RATE ADVANCE" means, at any time, the portion of the
Advances in Canadian Dollars with respect to which the Borrower has chosen, or,
in accordance with the provisions hereof, is obliged, to pay interest calculated
in accordance with the provisions of Section 3.08.
"PURCHASE MONEY MORTGAGE" means, in respect of any Person, any
Security Interest charging property acquired by such Person, which is granted or
assumed by such Person in connection with the acquisition of such property and
within not more than 60 days following such acquisition, reserved by the
transferor (including any reservation of title in respect of any lease recorded
as a capital lease) or which arises by operation of Law in favour of the
transferor concurrently with and for the purpose of the acquisition of such
property, in each case where (i)
26
the principal amount secured by such Security Interest is not in excess of
the cost to such Person of the property acquired; and (ii) such Security
Interest extends only to the property acquired.
"QUEBECOR" means Quebecor Inc., a corporation incorporated and
subsisting under the laws of Quebec.
"REFERENCE DISCOUNT RATE" means, for any Drawing Date, in
respect of any Bankers' Acceptances or Drafts to be purchased pursuant to
Article 4 by (i) a Schedule I chartered bank, the average Bankers' Acceptance
discount rate for the appropriate term as quoted on Reuters Screen CDOR Page (or
such other page as is a replacement page for such Bankers' Acceptances) at 10:00
a.m. (Toronto time); and (ii) by any other Lender or Person, the lesser of (y)
the arithmetic average of the actual discount rate quoted by at least one, but
not more than two, Schedule II Reference Banks; and (z) the rate specified in
(i) plus 0.10%. If such rate is not available as of such time, then the discount
rate in respect of such Banker's Acceptances and Drafts shall mean the
arithmetic average of the discount rates (calculated on an annual basis and
rounded to the nearest one-hundredth of 1%, with five-thousandths of 1% being
rounded up) quoted by Bank of America N.A., Canada Branch and Royal Bank of
Canada at 10:00 a.m. (Toronto time) as the discount rate at which each such
Lender would purchase, on the relevant Drawing Date, its own Bankers'
Acceptances or Drafts having an aggregate Face Amount equal to and with a term
to maturity the same as the Bankers' Acceptances or Drafts to be acquired by
such Lender or other Person on such Drawing Date.
"RELEASE" when used as a verb includes release, spill, leak,
emit, deposit, discharge, xxxxx, migrate or dispose into the environment and the
term "RELEASE" when used as a noun has a correlative meaning, but does not
include any emission or discharge pursuant to a valid Environmental Permit.
"REMEDIAL ACTION" means any action required under any
applicable Environmental Law to (i) clean up, remove, treat or in any other way
deal with Hazardous Substances in the environment; (ii) prevent any Release of
Hazardous Substances where such Release would violate any Environmental Laws or
would endanger or threaten to endanger public health or welfare or the
environment; or (iii) perform remedial studies, investigations, restoration and
post-remedial studies, investigations and monitoring on, about or in connection
with any of the Owned Properties, the Leased Properties or other Assets of the
Borrower and its subsidiaries.
"SCHEDULE II REFERENCE BANKS" means Bank of America, N.A,
Canada Branch and Credit Suisse First Boston, Toronto Branch.
"SECURITY" means, at any time, the Security Interests in
favour of the Administrative Agent or the Lenders, or both, in the Assets and
properties of the Borrower and the Guarantors (save for Assets excluded under
the Security Documents) securing their obligations under this Agreement or the
other Credit Documents (excluding the subordination agreements referred to in
that definition), including for greater certainty the obligations under the
Hedging Agreements and the Overdraft Facility.
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"SECURITY DOCUMENTS" means the agreements described in
Schedule 5 and annexed thereto and any other Security granted to the
Administrative Agent or the Lenders, or both (including Security granted by a
new Guarantor), as security for the obligations of the Borrower and the
Guarantors under this Agreement, the other Credit Documents (excluding the
subordination agreements referred to in that definition) and, for greater
certainty, the Overdraft Facility.
"SECURITY INTEREST" means any hypothec, mortgage, pledge,
security interest, encumbrance, lien, charge or deposit arrangement or any other
arrangement or condition that in substance secures payment or performance of an
obligation and includes the interest of a vendor or lessor under any conditional
sale agreement, capitalized lease or other title retention agreement.
"SELECTED AMOUNT" means, with respect to a Libor Advance, the
amount in respect of which the Borrower has asked, in accordance with Section
3.02, that the interest payable thereon be calculated on the Libor Basis.
"SENIOR NOTES" means the notes created under the Senior
Note Indenture and dated as of February 7, 2003, designated as "7-5/8% Senior
Notes" , and maturing on February 15, 2013 , as same may be amended, modified
or supplemented from time to time, provided that no such amendment shall
affect the unsecured nature of the Senior Notes, nor shall it shorten the
maturity of the Senior Notes to any period which is less than one year
following the expiry of the Term of the last to expire of Facility A or Term
Facility B.
"SENIOR NOTE INDENTURE" means the trust indenture dated as of
February 7, 2003 between National City Bank and the Borrower under which the
Senior Notes were issued, as same may be amended, modified or supplemented from
time to time, provided that no such amendment shall affect the unsecured nature
of the Senior Notes, nor shall it shorten the maturity of the Senior Notes to
any period which is less than one year following the expiry of the Term of the
last to expire of Facility A or Term Facility B.
"SUBSIDIARY" means any Person in respect of which the majority
of the issued and outstanding capital stock (including securities convertible
into voting shares and options to purchase voting shares) granting a right to
vote in all circumstances is at the relevant time owned by the Borrower and/or
one or more of its subsidiaries, and includes a partnership and limited
partnership that would be an Affiliate if it were a corporation. The
subsidiaries of the Borrower are listed in Schedule 7.01(a).
"SUBORDINATED DEBT" means, in respect of any Person, Debt of
such Person which (i) has covenants, events of default and redemption,
repurchase and modification provisions, in the aggregate, that are not
materially less favorable to such Person than the covenants, events of default
and redemption, repurchase and modification provisions of the Senior Notes as in
effect on the Closing Date; (ii) have no required redemption provisions and
mature after the later of the expiry of the Term of Facility A or Facility B;
(iii) are unsecured; (iv) have no payment of interest following an Event of
Default which has not been waived, and do not contemplate any payment of
principal, voluntary (except out of the proceeds of the issuance of other
Subordinated Debt, and not following a Default which has occurred and is
continuing or an Event of Default which has not been waived)
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or involuntary, at any time prior to the expiry of the Term of the last to
expire of Facility A or Term Facility B; and (v) provides that the
Accommodations Outstanding and any other amounts payable hereunder or under
any Credit Document will have the benefit of such subordination terms.
"SWINGLINE LENDER" means the Lender which has provided a
Swingline Commitment hereunder. For the purposes hereof, the Swingline Lender
shall be Bank of America N.A., Canada Branch, unless such Swingline Lender no
longer wishes to act as such, in which case the provisions of Section 10.09
hereof shall apply, MUTATIS MUTANDIS, except that only the Facility A Lenders
(and not the Term Lenders) shall appoint such replacement Swingline Lender.
"SYNTHETIC LEASE" means any synthetic lease or similar
off-balance sheet financing product where such transaction is considered
borrowed money for tax purposes but is classified as an operating lease in
accordance with GAAP.
"TAX BENEFIT TRANSACTION" means, for so long as the Borrower
is a direct or indirect subsidiary of Quebecor, any transaction between a Loan
Party and Quebecor or any of its Affiliates, the primary purpose of which is to
create tax benefits for any Loan Party or for Quebecor or any of its Affiliates;
PROVIDED, HOWEVER, that (1) the Loan Party involved in the transaction obtains a
favorable tax ruling from a competent tax authority or a favorable tax opinion
from a nationally recognized Canadian law or accounting firm having a tax
practice of national standing as to the tax efficiency of the transaction for
such Loan Party; (2) the Borrower delivers to the Administrative Agent (a) a
resolution of the board of directors of the Borrower to the effect the
transaction will not prejudice the Lenders and certifying that such transaction
has been approved by a majority of the disinterested members of such board of
directors and (b) an opinion as to the fairness to such Loan Party of such
transaction from a financial point of view issued by an accounting, appraisal or
investment banking firm of national standing in the United States or Canada; (3)
such transaction is set forth in writing; and (4) the Consolidated EBITDA of the
Borrower is not reduced after giving PRO FORMA effect to the transaction as if
the same had occurred at the beginning of the most recently ended four fiscal
quarter period of the Borrower for which internal financial statements are
available; PROVIDED, HOWEVER, that if such transaction shall thereafter cease to
satisfy the preceding requirements as a Tax Benefit Transaction, it shall
thereafter cease to be a Tax Benefit Transaction for purposes of this Agreement
and shall be deemed to have been effected as of such date and, if the
transaction is not otherwise permitted by this Agreement as of such date, the
Borrower will be in Default hereunder if such transaction does not comply with
the preceding requirements or is not otherwise unwound within 30 days of that
date.
"TAXES" has the meaning specified in Section 12.07(1).
"TERM" means the period commencing on the Closing Date and
terminating with respect to (i) Facility A, five (5) years therefrom, and (ii)
Term Facility B, six (6) years therefrom.
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"TERM FACILITY B" means the term credit facility in an
amount of US$230,000,000 made available to the Borrower in accordance with
Article 2.
"US PRIME RATE" means, for any day, a fluctuating rate per
annum (expressed as an annual rate calculated based on a 365 or 366 day year, as
the case may be) equal to the higher of (a) the Federal Funds Effective Rate
plus 1/2 of 1% and (b) the rate of interest in effect for such day as publicly
announced from time to time by Bank of America as its "prime rate" in the U.S.A.
The "prime rate" is a rate set by Bank of America based upon various factors
including Bank of America's costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.
"US PRIME RATE ADVANCE" means, at any time, the part of
the Advances in US $ in respect of which interest is calculated in
accordance with the provisions of Section 3.09.
"US DOLLARS" or "US $" means the lawful currency of the United
States of America in same day immediately available funds or, if such funds are
not available, the currency of the United States of America which is ordinarily
used in the settlement of international banking operations on the day on which
any payment or any calculation must be made pursuant to this Agreement;
SECTION 1.02. GENDER AND NUMBER. Any reference in the
Credit Documents to gender includes all genders, and words importing the
singular number only include the plural and vice versa.
SECTION 1.03. INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.
The provisions of a Table of Contents, the division of this Agreement into
Articles and Sections and the insertion of headings are for convenience of
reference only and shall not affect the interpretation of this Agreement.
SECTION 1.04. CURRENCY. All references in the Credit
Documents to dollars, unless otherwise specifically indicated, are
expressed in Canadian currency.
SECTION 1.05. CERTAIN PHRASES, ETC. In any Credit Document (i)
(y) the words "including" and "includes" mean "including (or includes) without
limitation" and (z) the phrase "the aggregate of", "the total of", "the sum of",
or a phrase of similar meaning means "the aggregate (or total or sum), without
duplication, of", and (ii) in the computation of periods of time from a
specified date to a later specified date, unless otherwise expressly stated, the
word "from" means "from and including" and the words "to" and "until" each mean
"to but excluding".
SECTION 1.06. ACCOUNTING TERMS. All accounting terms
not specifically defined in this Agreement shall be interpreted in
accordance with GAAP.
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SECTION 1.07. NON-BUSINESS DAYS. Whenever any payment is
stated to be due on a day which is not a Business Day, such payment shall be
made on the next succeeding Business Day, and such extension of time shall be
included in the computation of interest or Fees, as the case may be.
SECTION 1.08. RATEABLE PORTION OF ACCOMMODATIONS. References
in this Agreement to a Lender's rateable portion of Advances, Drawings, Letters
of Credit, Drafts and Banker's Acceptances or rateable share of payments of
principal, interest, Fees or any other amount, shall mean and refer to a
rateable portion or share as nearly as may be rateable in the circumstances, as
determined in good faith by the Administrative Agent. Each such determination by
the Administrative Agent shall be PRIMA FACIE evidence of such rateable share.
SECTION 1.09. INCORPORATION OF SCHEDULES. The schedules
attached to this Agreement shall, for all purposes of this Agreement, form
an integral part of it.
ARTICLE 2
CREDIT FACILITY
SECTION 2.01. AVAILABILITY. (1) Each Lender individually and
not jointly and severally (or solidarily) agrees, on the terms and conditions of
this Agreement, to make Accommodations rateably to the Borrower in accordance
with such Lender's Facility A Commitment and / or Term Credit Commitment.
Accommodations under Facility A may be made available as (i) Prime Rate Advances
and Swingline Advances, where applicable, pursuant to Article 3; (ii) Bankers'
Acceptances pursuant to Article 4; or Letters of Credit under Article 5.
Accommodations under Term Facility B may be made available as Libor Advances or
as US Prime Rate Advances. The Swingline Lender agrees, on the terms and
conditions of this Agreement, to make Swingline Advances to the Borrower in
accordance with its Swingline Commitment. The Issuing Lender agrees, on the
terms and conditions of this Agreement, to make Letters of Credit available to
the Borrower in accordance with the provisions of Article 5.
(2) The failure of any Lender to make an Accommodation shall
not relieve any other Lender of its obligation, if any, in connection with any
such Accommodation, but no Lender is responsible for any other Lender's failure
in respect of such Accommodation.
(3) The Administrative Agent shall give each Lender prompt
notice of any (i) Accommodation Notice received from the Borrower and of each
Lender's rateable portion of any Accommodation; and (ii) other notice received
by it from the Borrower under this Agreement.
SECTION 2.02. COMMITMENTS AND FACILITY LIMITS. (1) The
Accommodations Outstanding (i) to all Facility A Lenders under Facility A shall
not at any time exceed the Facility A Commitment; and (ii) to each Facility A
Lender under Facility A shall not at any time exceed such Lender's Facility A
Commitment (provided, for greater certainty, that the Swingline
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Lender's Facility A Commitment shall not be reduced by more than its rateable
portion of Swingline Advances made or to be made by it in its capacity as
Swingline Lender, and the Issuing Lender's Facility A Commitment shall not be
reduced by more than its rateable portion of the Accommodations Outstanding
by Letter of Credit made or to be made by it in its capacity as Issuing
Lender). The principal amount of all Swingline Advances outstanding to the
Swingline Lender shall not, at any time, exceed the Swingline Commitment,
which shall itself not exceed Cdn.$5,000,000. The aggregate Face Amount of
Letters of Credit outstanding shall not at any time exceed Cdn.$2,000,000.
The Accommodations Outstanding (a) to all Term Lenders under Term Facility B
shall not at any time exceed the Term Credit Commitment; and (b) to each Term
Lender under Term Facility B shall not at any time exceed such Lender's Term
Credit Commitment.
(2) Facility A shall revolve and, except as otherwise provided
herein, no payment under Facility A shall reduce the Facility A Commitment or
any Lender's Facility A Commitment. Term Facility B shall not revolve and any
amount repaid or prepaid, as the case may be, under Term Facility B cannot be
reborrowed and shall reduce the Term Credit Commitment by the amount repaid or
prepaid, as the case may be.
(3) A conversion from one Type of Accommodation to another
Type of Accommodation shall not constitute a repayment or prepayment.
SECTION 2.03. USE OF PROCEEDS. (1) The Borrower may use the
proceeds of any Accommodations under Facility A (i) for general corporate
purposes, (ii) in respect of an amount of not more than $5,000,000, to provide
for the Defeasance of the Existing Credit Agreement and the Existing Notes and
(iii) to make Additional Distributions, provided that no Accommodation for such
purpose shall be permitted unless the remaining (unused) Facility A Commitment
available under Facility A after making any such Additional Distribution would
be at least $25,000,000.
(2) The Borrower may use the proceeds of any Accommodations
under Term Facility B, together with other funds available to it, (i) to
refinance the outstanding principal amount of existing bank Debt of the Borrower
in an aggregate amount of approximately Cdn.$301,000,000; (ii) to repay the
Existing Notes (including interest and prepayment premiums) of approximately
US$165,000,000; and (iii) to make a Permitted Distribution in an amount of
approximately Cdn.$260,000,000 to Quebecor Media Inc., directly or indirectly.
(3) No proceeds of any Advance will be used to purchase or
carry any equity security of a class which is registered pursuant to Section 12
of the U.S. SECURITIES EXCHANGE ACT of 1934, as amended, or any "margin stock",
as defined in Federal Reserve System Board of Governors Regulation U, or for a
purpose which violates, or would be inconsistent with, Federal Reserve System
Board of Governors Regulation T, U or X. Terms used in this Section for which
meanings are provided in Federal Reserve System Board of Governors Regulation T,
U or X or any regulations substituted therefor, as from time to time in effect,
have the meaning so provided.
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SECTION 2.04. MANDATORY REPAYMENTS AND REDUCTIONS OF
COMMITMENTS. (1) Subject to Section 9.01, the Borrower shall repay the
Accommodations Outstanding under Facility A on the last day of the Term.
(2) Subject to Section 9.01, the Borrower shall repay the
Accommodations Outstanding under Term Facility B in quarterly installments equal
to .25% of the full amount of Term Facility B, being US$230,000,000, each such
installment being payable on the last Business Day of each of the months of
April, July, October and January of each year until January 31, 2009, and shall
repay the balance of the Accommodations Outstanding under Term Facility B on the
last day of the Term of Term Facility B.
SECTION 2.05. MANDATORY PREPAYMENTS. (1) Subject to
subsection (5) hereof, the Borrower agrees to make the following
mandatory prepayments ("MANDATORY PREPAYMENTS").
(2) Subject to the next following sentence, an amount equal to
the Net Proceeds from any Disposition of any Assets in excess of $10,000,000 by
the Borrower or any of the Guarantors (other than any Disposition of Assets
permitted pursuant to clauses (i), (ii), (iii) and (iv) of Section 8.02(d))
shall be applied within 365 days of receipt to the PRO RATA prepayment of
Accommodations Outstanding under (i) firstly, Term Facility B; and (ii)
secondly, Facility A (provided that the Facility A Commitment shall not be
reduced as a result of such payment), in each case, in accordance with Section
2.09 hereof, except to the extent that the Net Proceeds from such Disposition of
Assets are reinvested (other than in cash or Cash Equivalents) in the Business
within 360 days of the date of receipt of such Net Proceeds.
(3) Subject as provided in the next following sentence, an
amount equal to 75% of the Net Proceeds of any Subordinated Debt (other than,
for greater certainty, Subordinated Debt, the Net Proceeds of which are used to
repay or prepay the Senior Notes or other Subordinated Debt within two Business
Days of the date of receipt of such Net Proceeds) by the Borrower or the
Guarantors shall be applied to the prepayment of the Accommodations Outstanding
under Term Facility B, in accordance with Section 2.09 hereof. The percentage of
Net Proceeds payable pursuant to this Section 2.05(3) shall be reduced to 50%
for any Subordinated Debt if, as of the last day of the most recently completed
Financial Quarter, the Leverage Ratio is less than 2.5:1, and would not exceed
2.5:1 as a result of the incurrence of such new Subordinated Debt (as evidenced
by a Compliance Certificate delivered to the Administrative Agent and the
Lenders).
(4) Subject as provided in the next following sentence, an
amount equal to 75% of the Net Proceeds from the issuance of any securities
(other than the Back-to-Back Securities, the Existing Back-to-Back Securities
and Debt securities, but including Debt securities of the nature described in
clause (viii) of the definition of "Debt") by the Borrower or the Guarantors
(other than the issuance of equity among or of any capital contribution by any
Person in the Borrower or by any Guarantor in another Loan Party) shall be
applied to the prepayment of the Accommodations Outstanding under Term Facility
B, in accordance with Section 2.09 hereof. The percentage of Net Proceeds
payable pursuant to this Section 2.05(4)
33
shall be reduced to 50% for any issuance of securities if, as of the last day
of the most recently completed Financial Quarter, the Leverage Ratio is less
than 2.5:1 (as evidenced by a Compliance Certificate delivered to the
Administrative Agent and the Lenders).
(5) The Borrower shall advise the Administrative Agent of its
intention to make any such Mandatory Prepayment by notice in writing
substantially in the form of Schedule 2, at least 10 and not more than 20
Business Days before the Mandatory Prepayment is due, and shall pay the amount
of such Mandatory Prepayment to the Administrative Agent when it is due. In
addition, the Borrower shall, at the same time, make a written offer (an
"OFFER") to the Term Lenders, by sending such Offer, substantially in the form
of Schedule 3, to the Administrative Agent for distribution to the Term Lenders,
setting out the entitlement of each such Lender to such Mandatory Prepayment
(other than any Unacceptable Payment, as defined below). Each Term Lender shall
irrevocably respond to the Offer, with a copy to the Administrative Agent, at
least 3 Business Days' before the Mandatory Prepayment is due. Failure on the
part of any Term Lender to so respond shall be deemed an acceptance of the Offer
by such Term Lender. All proceeds of each Mandatory Prepayment shall be applied
rateably amongst the Term Lenders to repay and permanently reduce Term Facility
B in inverse order of maturity. However, the Borrower shall not be obliged to
make an Offer and the Term Lenders shall not accept any Mandatory Repayment if,
as a result thereof, the Term Lenders would receive, within 5 years and 10 days
from the date of the first Advance under Term Facility B, an amount that, when
added to the scheduled repayments contemplated by Section 2.04 and to all other
Mandatory Prepayments made prior to that date, would be equal to or would exceed
25% of the amount of the initial Advance under Term Facility B (an "UNACCEPTABLE
PAYMENT"). If any Term Lender decides not to accept any such Mandatory
Repayment, the amount of such Mandatory Repayment that would have been paid to
such Term Lender shall be paid to the Facility A Lenders to reduce the
Accommodations Outstanding, but not the Commitments, under Facility A; provided
that if there are no Accommodations Outstanding under Facility A at such time,
such amount may be retained by the Borrower.
No such Mandatory Prepayment may be made on a date that would require a Libor
Advance to be prepaid, except in accordance with the provisions of Section
12.06(4), provided that the Borrower may cash collateralize such Libor Advances
(and Bankers' Acceptances) in accordance with the provisions of Section 2.10.
SECTION 2.06. OPTIONAL PREPAYMENTS AND REDUCTIONS OF
COMMITMENTS. (1) The Borrower may, subject to the provisions of this Agreement,
(i) prepay without penalty or bonus Accommodations Outstanding under any Credit
Facility; or (ii) reduce the Lenders' Facility A Commitment, and, if required as
a result of such reduction, the Accommodations Outstanding under Facility A, in
each case in whole or in part, subject to providing seven (7) Business Days'
notice to the Administrative Agent stating the proposed date and aggregate
principal amount of the prepayment or reduction. Each partial prepayment or
reduction shall be in a minimum aggregate principal amount of US$5,000,000 in
respect of Term Facility B and $1,000,000 in respect of Facility A and in an
integral multiple of $1,000,000 or US$1,000,000, as the case may be.
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(2) The Borrower may not in any event prepay the amount of any
Drawing on any date other than the maturity date for the relevant Drawing,
provided that the Borrower may cash collateralize such Drawings in accordance
with the provisions of Section 2.10.
SECTION 2.07. FEES. (1) The Borrower shall pay to the
Administrative Agent, for the account of the Facility A Lenders, a fee
calculated at a rate per annum equal to the Applicable Commitment Fee calculated
on the unused and uncancelled portion of Facility A (determined without regard
to any Swingline Advance) calculated daily and payable in arrears on the last
day of each calendar quarter and on the last day of the Term of Facility A.
(2) The Borrower shall pay to Banc of America Securities LLC a
fee determined in accordance with the Commitment Letter accepted by the Borrower
dated January 13, 2003, payable in accordance with its terms.
SECTION 2.08. PAYMENTS UNDER THIS AGREEMENT. (1) Unless
otherwise expressly provided in this Agreement, the Borrower shall make any
payment required to be made by it to the Administrative Agent or any Lender by
depositing the amount of the payment to the appropriate Agency Branch Account
not later than 10:00 a.m. (Toronto time) on the date the payment is due. The
Administrative Agent shall distribute to each Lender, promptly on the date of
receipt by the Administrative Agent of any payment, an amount equal to the
amount then due to each Lender. Any amount received by the Administrative Agent
for the account of the Lenders shall be held as mandatary for the Lenders until
distributed.
(2) Unless otherwise expressly provided in this Agreement, the
Administrative Agent shall make Accommodations and other payments to the
Borrower under this Agreement by transferring the amount of the payment in the
relevant currency to the Borrower's account as may be instructed by the Borrower
in writing on the date the payment is to be made.
(3) The Borrower hereby authorizes each Lender, if and to the
extent payment owed to such Lender by the Borrower is not made to the
Administrative Agent when due, to charge from time to time any amount due
against any or all accounts of the Borrower with such Lender.
(4) All payments by the Borrower under Facility A shall be in
Canadian Dollars. All payments by the Borrower under the Term Facility shall be
in US Dollars.
SECTION 2.09. APPLICATION OF PAYMENTS AND PREPAYMENTS. (1)
Subject to paragraph (2) hereof, each prepayment pursuant to Section 2.05 and
Section 2.06 in respect of Term Facility B shall be applied to the instalments
pursuant to Section 2.04 in the inverse order of their maturity, subject to
paying the applicable breakage costs (as contemplated by Section 12.06) if any
Libor Advance is prepaid.
(2) All amounts received by the Administrative Agent from or
on behalf of the Borrower and not previously applied pursuant to this Agreement
shall be applied by the
35
Administrative Agent as follows (i) first, in reduction of the Borrower's
obligation to pay any amounts owing to the Administrative Agent; (ii) second,
in reduction of the Borrower's obligation to pay any unpaid interest and any
Fees which are due and owing; (iii) third, in reduction of the Borrower's
obligation to pay any Claims or Losses referred to in Sections 12.06; (iv)
fourth, in reduction of the Borrower's obligation to pay any amounts due and
owing on account of any unpaid principal amount of Accommodations Outstanding
or amounts under Hedging Agreements which are due and owing; (v) fifth, in
reduction of the Borrower's obligation to pay any other unpaid amounts which
are due and owing to the Lenders; (vi) sixth, in reduction of any other
obligation of the Borrower under this Agreement and the other Credit
Documents; and (vii) seventh, to the Borrower or such other Persons as may
lawfully be entitled to or directed to receive the remainder.
SECTION 2.10 CASH COLLATERALIZATION OF CERTAIN PAYMENTS AND
PREPAYMENTS. If a payment or Mandatory Prepayment to be made would require the
repayment of outstanding Bankers' Acceptances, Letters of Credit or Libor
Advances prior to their maturity, the Borrower shall provide to the
Administrative Agent cash collateral in an amount equal to the Face Amount of
such Bankers' Acceptances or Letters of Credit or the principal amount of such
Libor Advances, as the case may be, which cash collateral shall be held by the
Administrative Agent in an interest bearing account, or invested, in accordance
with the instructions of the Borrower (provided no Default has occurred and is
continuing and no Event of Default has occurred), in Cash Equivalents (in either
case, with interest for the benefit of the Borrower), and used to repay same at
maturity. However, in the case where the payment or Mandatory Prepayment would
require the actual prepayment of a Libor Advance, the Borrower may elect to
prepay same and pay to the Administrative Agent for the Lenders the amount of
the losses, costs and expenses suffered or incurred by the Lenders with respect
thereto which are referred to in Section 12.06(4).
SECTION 2.11. COMPUTATIONS OF INTEREST AND FEES. (1) All
computations of interest shall be made by the Administrative Agent taking into
account the actual number of days occurring in the period for which such
interest is payable, and a year of 365/366 days, or, in the case of a Libor
Advance, 360 days.
(2) All computations of Fees shall be made by the
Administrative Agent on the basis of a year of 365 or 366 days, as the case may
be, taking into account the actual number of days (including the first day but
excluding the last day) occurring in the period for which such fees are payable.
(3) For purposes of the INTEREST ACT (Canada), (i) whenever
any interest or Fee under this Agreement is calculated using a rate based on a
number of days less than a full year, such rate determined pursuant to such
calculation, when expressed as an annual rate, is equivalent to (x) the
applicable rate, (y) multiplied by the actual number of days in the calendar
year in which the period for which such interest or fee is payable (or
compounded) ends, and (z) divided by the number of days comprising such
calculation basis; (ii) the principle of deemed reinvestment of interest does
not apply to any interest calculation under this Agreement; and (iii) the rates
of interest stipulated in this Agreement are intended to be nominal rates and
not effective rates or yields.
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(4) No provision of this Agreement shall have the effect of
requiring any Borrower to pay interest (as such term is defined in section 347
of the CRIMINAL CODE OF CANADA) at a rate in excess of 60% per annum, taking
into account all other amounts which must be taken into account for the purpose
thereof and, to such extent, the Borrower's obligation to pay interest hereunder
shall be so limited.
ARTICLE 3
ADVANCES
SECTION 3.01. THE ADVANCES. (1) Each Facility A Lender
individually, and not jointly and severally (or solidarily) agrees, on the terms
and conditions of this Agreement, and from time to time prior to the date which
is one Business Day prior to the last Business Day of the Term of Facility A, to
make Prime Rate Advances to the Borrower on any Business Day. The Swingline
Lender agrees, on the terms and conditions of this Agreement, and from time to
time prior to the date which is one Business Day prior to the last Business Day
of the Term of Facility A and subject to the right of the Swingline Lender to
cease acting as such upon thirty (30) days notice to the Administrative Agent
and the Borrower (except where a Default has occurred and is continuing, in
which case no prior notice shall be required), to make Prime Rate Advances to
the Borrower on any Business Day, and immediately thereupon, each Facility A
Lender shall be deemed to, and irrevocably and unconditionally agrees to,
purchase from the Swingline Lender a risk participation in such Swingline
Advance in an amount equal to its rateable share of same. The Borrower shall
repay all outstanding Swingline Advances of the Swingline Lender not less
frequently than by the 15th of each month and the second-to-last Business Day of
each month, failing which a Mandatory Borrowing (as defined and contemplated in
paragraph (2) below) shall occur. If the Swingline Lender elects to resign as
such, the Borrower shall be obliged to find a replacement Swingline Lender,
failing which the Swingline Commitment will expire (but, for greater certainty,
without reducing the Facility A Commitment) and no Swingline Advances will be
available. Each Advance (other than Swingline Advances) shall be made rateably
by the applicable Lenders.
(2) Upon receipt by the Swingline Lender of a notice from the
Administrative Agent that one or more of the applicable conditions specified in
Section 6.02 are not then satisfied, no further Advances shall be made or
issued, as the case may be, by the Swingline Lender. Upon receipt of a notice
from the Administrative Agent that a Default has occurred and is continuing, the
Swingline Lender may, in its sole discretion, give notice to the Administrative
Agent who shall forthwith notify the Facility A Lenders that the principal
amount of its outstanding Swingline Advances shall be funded with an Advance
under Facility A (provided that even absent such notice of a Default, such
notice shall be deemed to have been given (a) at 10:00 a.m. Toronto time on the
15th of each month and the second-to-last Business Day of each month if the
Borrower shall not have repaid all Swingline Advances on or prior to such days,
(b) on the last day of the Term of Facility A if the Borrower shall not have
repaid all Swingline
37
Advances on or prior to such day, and (c) upon the occurrence of a demand
pursuant to Section 9.01 or an Event of Default, in which case Advances under
Facility A (each such Advance, a "MANDATORY BORROWING") shall be made on the
next Business Day by all Facility A Lenders, so that immediately after the
Mandatory Borrowing, each such Facility A Lender shall share rateably in the
Accommodations Outstanding under Facility A and the proceeds shall be applied
directly by the Administrative Agent to repay Advances outstanding to the
Swingline Lender. Each applicable Facility A Lender shall make Advances
pursuant to a Mandatory Borrowing in the amount and in the manner specified
in writing by the Administrative Agent notwithstanding (i) that the amount of
the Mandatory Borrowing may not comply with the minimum amount for Advances
otherwise required under this Agreement; (ii) that the conditions specified
in Article 6 are not satisfied; (iii) that a Default has occurred and is
continuing or an Event of Default has occurred; (iv) the date of such
Mandatory Borrowing; and (v) any reduction in the Facility A Commitment after
any Advance was made by the Swingline Lender.
(3) Each Term Lender individually, and not jointly and
severally (or solidarily) agrees, on the terms and conditions of this Agreement,
to make Libor Advances and US Prime Rate Advances to the Borrower on any
Business Day. Each Advance shall be made rateably by the applicable Lenders. All
Advances under Term Facility B shall be in US Dollars alone. The initial Advance
under Term Facility B shall be for the full amount available thereunder and
shall be made on the Closing Date. Any portion of the Advances available to the
Borrower under Term Facility B that is not borrowed as part of such initial
Advance or that is repaid shall not again be available for borrowing, although
Libor Advances may be rolled over into new Libor Advances or converted into US
Prime Rate Advances, and US Prime Rate Advances may be converted into Libor
Advances.
SECTION 3.02. PROCEDURE FOR ADVANCES. Except as provided in
Section 3.02(2), each Advance shall be in a minimum amount of $1,000,000 for
Prime Rate Advances and US Prime Rate Advances, and $5,000,000 for Libor
Advances, and in an integral multiple of $1,000,000 in each case, and shall be
subject to the Borrower providing the appropriate number of days' prior notice
specified in this Agreement (being one Business Day's notice for Prime Rate
Advances and US Prime Rate Advances and three Banking Days' notice for Libor
Advances), given not later than 10:00 a.m. (Toronto time) by the Borrower to the
Administrative Agent. Each notice of an Advance (a "BORROWING NOTICE") shall be
in substantially the form of Schedule 1, shall be irrevocable and binding on the
Borrower and shall specify (i) the requested date of the Advance; (ii) the
aggregate amount of the Advance; and (iii) the Credit Facility under which such
Advance is requested. Upon receipt by the Administrative Agent of funds from the
Lenders and fulfilment of the applicable conditions set forth in Article 6, the
Administrative Agent will make such funds available to the Borrower in
accordance with Article 2.
(2) Each Swingline Advance may be made on the same day, and in
such amount (provided that each Swingline Advance shall be in a minimum amount
of $500,000, and there shall be no more than 2 Swingline Advances per week), as
requested by the Borrower by giving an irrevocable telephone notice on any
Business Day to the Swingline Lender and to the Administrative Agent, followed
by the immediate delivery of a written Borrowing Notice to the Swingline Lender
(with a copy to the Administrative Agent on the same day).
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SECTION 3.03. LIBOR ADVANCES. If the Advance requested is a
Libor Advance, the Administrative Agent shall determine the LIBOR which will be
in effect on the date of the Advance (which must be a Banking Day), with respect
to the Selected Amount or to each of the Selected Amounts, as the case may be,
having a maturity of 1, 2, 3 or 6 months (subject to availability, or such other
period of 10 to 180 days which may be available and is acceptable to the
Administrative Agent) from the date of the Advance (a "DESIGNATED PERIOD").
However, if the Borrower has not delivered a notice to the Administrative Agent
in a timely manner in accordance with the provisions of Section 3.02, the
Borrower shall be deemed to have requested a US Prime Rate Advance. In addition,
the Borrower may not have more than 15 different Libor Advances outstanding at
any time.
SECTION 3.04. MARKET FOR LIBOR ADVANCES. If, at any time or
from time to time, as a result of market conditions, (i) there exists no
appropriate or reasonable method to establish LIBOR, for a Selected Amount or a
Designated Period, or (ii) US Dollar deposits are not available to the Lenders
in such market in the ordinary course of business in amounts sufficient to
permit them to make the Libor Advance, for a Selected Amount or a Designated
Period, such Lenders shall so advise the Administrative Agent and, any such
Lenders shall not be obliged to honour any Borrowing Notice in connection with
any Libor Advances, and the Borrower's option to request Libor Advances shall
thereupon be suspended upon notice by the Administrative Agent to the Borrower.
SECTION 3.05. SUSPENSION OF LIBOR ADVANCE OPTION. If a notice
has been given by the Administrative Agent in accordance with Section 3.04,
Libor Advances, or any part thereof, shall not be made (whether as an Advance, a
conversion or an extension) by the Lenders affected by the circumstances
referred to in Section 3.04 and the right of the Borrower to choose that Libor
Advances from such Lenders be made or, once made, be converted or extended into
a Libor Advance shall be suspended until such time as the Administrative Agent
has determined that the circumstances having given rise to such suspension no
longer exist, in respect of which determination the Administrative Agent shall
advise the Borrower within a reasonable delay.
SECTION 3.06. LIMITS ON LIBOR ADVANCES. Nothing in this
Agreement shall be interpreted as authorizing the Borrower to borrow by way of
Libor Advances for a Designated Period expiring on a date which results in a
situation where Term Facility B cannot be reduced as required by this Agreement,
or on a date which is after the expiry of the Term.
SECTION 3.07. CONVERSIONS OF ADVANCES. The Borrower may elect
to convert an Advance, or any portion thereof, to another type of Accommodation
in the same currency upon the number of days notice specified in Section 3.02 by
sending an Accommodation Notice on any Business Day.
SECTION 3.08. INTEREST ON PRIME RATE ADVANCES. Subject to the
next following sentence, the Borrower shall pay interest on the unpaid principal
amount of each Prime Rate Advance from the date of such Advance until the date
on which the principal amount of the Prime Rate Advance is repaid in full at a
rate per annum equal at all times to the Canadian Prime
39
Rate in effect from time to time plus the Applicable Margin, calculated
daily, and payable in arrears (i) on the last day of each month in each year;
and (ii) when such Advance becomes due and payable in full pursuant to the
provisions hereof. Any amount of principal of or interest on any such Advance
which is not paid when due (whether at stated maturity, by acceleration or
otherwise) shall (to the extent permitted by Law) bear interest (both before
and after judgment), from the date on which such amount is due until such
amount is paid in full, payable on demand, at a rate per annum equal to the
sum of (i) the Canadian Prime Rate in effect from time to time; (ii) the
Applicable Margin; and (iii) 2%.
SECTION 3.09. INTEREST ON US PRIME RATE ADVANCES. Subject to
the next following sentence, the Borrower shall pay interest on the unpaid
principal amount of each US Prime Rate Advance from the date of such Advance
until the date on which the principal amount of the US Prime Rate Advance is
repaid in full at a rate per annum equal at all times to the US Prime Rate in
effect from time to time plus the Applicable Margin, calculated daily, and
payable in arrears (i) on the last day of each month in each year; and (ii) when
such Advance becomes due and payable in full pursuant to the provisions hereof.
Any amount of principal of or interest on any such Advance which is not paid
when due (whether at stated maturity, by acceleration or otherwise) shall (to
the extent permitted by Law) bear interest (both before and after judgment),
from the date on which such amount is due until such amount is paid in full,
payable on demand, at a rate per annum equal to the sum of (i) the US Prime Rate
in effect from time to time; (ii) the Applicable Margin; and (iii) 2%.
SECTION 3.10. INTEREST ON LIBOR ADVANCES. The principal amount
of the Libor Advances which at any time and from time to time remains
outstanding shall bear interest, calculated daily, on the daily balance of such
Libor Advances, from the date of each Libor Advance, at the annual rate
(calculated based on a 360-day year) applicable to each of such days which
corresponds to the LIBOR applicable to each Selected Amount, plus the Applicable
Margin, and shall be effective as and from the date of each Libor Advance up to
and including the last day of the applicable Designated Period. LIBOR shall be
promptly transmitted to the Borrower two Banking Days prior to the date on which
the Libor Advance is to be made. Such interest shall be payable to the
Administrative Agent, in arrears, on the last day of the Designated Period when
the Designated Period is 1 to 3 months, and when the Designated Period exceeds 3
months, on the last Business Day of each period of 3 months during such
Designated Period, and on the last day of the Designated Period. Any amount of
principal of or interest on any such Libor Advance which is not paid when due
(whether at stated maturity, by acceleration or otherwise) shall (to the extent
permitted by Law) bear interest (both before and after judgment), from the date
on which such amount is due until such amount is paid in full, payable on
demand, at a rate per annum equal to the sum of (i) the LIBOR in effect from
time to time; (ii) the Applicable Margin; and (iii) 2%.
40
ARTICLE 4
BANKERS' ACCEPTANCES
SECTION 4.01 ACCEPTANCES AND DRAFTS. (1) Each Facility A
Lender individually, and not jointly and severally (or solidarily) agrees, on
the terms and conditions of this Agreement and from time to time on any Business
Day prior to the expiry of the Term of Facility A (i) in the case of a Facility
A Lender which is willing and able to accept Drafts, to create acceptances
("BANKERS' ACCEPTANCES") by accepting Drafts and to purchase such Bankers'
Acceptances in accordance with Section 4.03(2), (ii) in the case of a Facility A
Lender which is unable to accept Drafts, to purchase completed Drafts (which
have not and will not be accepted by the Facility A Lender or any other Facility
A Lender) in accordance with Section 4.03(2), (iii) in the case of a Facility A
Lender which has participated or assigned all or any part of its interest in the
Credit Facilities to a Participant which is willing and able to accept Drafts,
to arrange for the creation of Bankers' Acceptances by such Participant and for
their purchase by such Participant, to the extent of the participation or
assignment, in accordance with Section 4.03(2), and (iv) in the case of a
Facility A Lender which has participated or assigned all or any part of its
interest in the Credit Facilities to a Participant which is unwilling or unable
to accept Drafts, to arrange for the purchase by the Participant of completed
Drafts (which have not and will not be accepted by such Facility A Lender or any
other Facility A Lender), to the extent of the participation or assignment, in
accordance with Section 4.03(2).
(2) Each Drawing shall be in a minimum amount of $3,000,000
and in an integral multiple of $1,000,000 and shall consist of the creation and
purchase of Bankers' Acceptances or the purchase of Drafts on the same day, in
each case for the Drawing Price, effected or arranged by the Facility A Lenders
in accordance with Section 4.03 and their respective Facility A Lender's
Commitment.
(3) If the Administrative Agent determines that the Bankers'
Acceptances to be created and purchased or Drafts to be purchased on any Drawing
(upon a conversion or otherwise) will not be created and purchased rateably by
the Facility A Lenders (or any of their respective Participants) in accordance
with Sections 4.01(2) and 4.03, then the requested Face Amount of Bankers'
Acceptances and Drafts shall be reduced to such lesser amount as the
Administrative Agent determines will permit rateable sharing and the amount by
which the requested Face Amount shall have been so reduced shall be converted or
continued, as the case may be, as a Prime Rate Advance under Facility A, to be
made contemporaneously with the Drawing.
(4) The Administrative Agent is authorized by the Borrower and
each Lender to allocate amongst the Facility A Lenders the Bankers' Acceptances
to be issued and purchased in such manner and amounts as the Administrative
Agent may, in its sole discretion, but acting reasonably, consider necessary, so
as to ensure that no Lender is required to accept and purchase a Bankers'
Acceptance for a fraction of $100,000, and in such event, the Lenders'
respective Facility A Commitments in any such Bankers' Acceptances and
repayments thereof shall be altered accordingly. Further, the Administrative
Agent is authorized by the Borrower and each Facility A Lender to cause the
proportionate share of one or more Lender's Accommodations
41
(calculated based on its Commitment) to be exceeded by no more than $100,000
each as a result of such allocations provided that the principal amount of
outstanding Accommodations, including Bankers' Acceptances, shall not thereby
exceed the maximum amount of the respective Commitment of each Facility A
Lender.
SECTION 4.02. FORM OF DRAFTS. Each Draft presented by the
Borrower shall (i) be in a minimum amount of $100,000 and in an integral
multiple of $100,000; (ii) be dated the date of the Drawing, and (iii) mature
and be payable by the Borrower (in common with all other Drafts presented in
connection with such Drawing) on a Business Day which occurs (subject to
availability) approximately 1, 2, 3, or 6 months after the Drawing Date (or such
other period of 10 to 180 days as may be available and acceptable to the
Administrative Agent), at the election of the Borrower, and on or prior to the
last day of the Term of Facility A.
SECTION 4.03. PROCEDURE FOR DRAWING. (1) Each Drawing shall be
made on notice (a "DRAWING NOTICE") given by the Borrower to the Administrative
Agent not later than 10:00 a.m. (Toronto time) not less than two Business Days
prior to the date on which the Drawing is to occur. Each Drawing Notice shall be
in substantially the form of Schedule 1, shall be irrevocable and binding on the
Borrower and shall specify (i) the Drawing Date; (ii) the fact that the Drawing
is to be made under Facility A; (iii) the aggregate Face Amount of Drafts to be
accepted and purchased (or purchased, as the case may be); and (iv) the contract
maturity date for the Drafts.
(2) Not later than 1:00 p.m. (Toronto time) on an applicable
Drawing Date, each Facility A Lender shall complete one or more Drafts in
accordance with the Drawing Notice and either (i) accept the Drafts and purchase
the Bankers' Acceptances thereby created for the Drawing Price; or (ii) purchase
such Drafts for the Drawing Price, and, in each case, pay to the Administrative
Agent the Drawing Proceeds in respect of such Bankers' Acceptance or Draft, as
the case may be. Upon receipt of the Drawing Proceeds and upon fulfilment of the
applicable conditions set forth in Article 6, the Administrative Agent shall
make funds available to the Borrower in accordance with Article 2.
(3) The Borrower shall, at the request of any Facility A
Lender, issue one or more non-interest bearing promissory notes (each a "BA
EQUIVALENT NOTE") payable on the date of maturity of the unaccepted Draft
referred to below, in such form as the Facility A Lender may specify and in a
principal amount equal to the Face Amount of, and in exchange for, any
unaccepted Drafts which the Facility A Lender has purchased or has arranged to
have purchased in accordance with Section 4.03(2).
(4) Bankers' Acceptances purchased by a Facility A Lender or
Participant may be held by it for its own account until the contract maturity
date or sold by it at any time prior to that date in any relevant Canadian
market in such Person's sole discretion.
SECTION 4.04. SIGNATURES OF DRAFT FORMS. The Borrower hereby
irrevocably appoints each Facility A Lender as its lawful attorney to sign and
endorse on its behalf, manually or by facsimile or mechanical signature, any BA
Instrument necessary to enable each Facility A Lender to make Drawings in the
manner specified in this Article 4. All Bankers' Acceptances
42
signed or endorsed on the Borrower's behalf and in accordance with its
instructions by a Facility A Lender shall be binding on the Borrower, all as
if duly executed and issued by the Borrower. No Facility A Lender shall be
liable for any Claim or Loss arising by reason of any loss or improper use of
any such BA Instruments, except arising out of the gross negligence or
willful misconduct of such Lender. Each Facility A Lender shall (i) maintain
a record with respect to any BA Instrument completed in accordance herewith,
voided by it for any reason, accepted and purchased by it hereunder, and
canceled at their respective maturities; and (ii) retain such records in the
manner and for the statutory periods provided in the various provincial or
federal statutes and regulations which apply to such Facility A Lender. On
request by the Borrower, a Facility A Lender shall cancel all BA Instruments
which have been pre-signed or pre-endorsed on behalf of such Borrower and
which are held by such Facility A Lender and are not required to make
Drawings in accordance with this Article 4.
SECTION 4.05. PAYMENT, CONVERSION OR RENEWAL OF BA
INSTRUMENTS. (1) Upon the maturity of a BA Instrument, the Borrower may (i)
elect to issue a replacement BA Instrument by giving a Drawing Notice in
accordance with Section 4.03(1); (ii) elect to have all or a portion of the Face
Amount of the BA Instrument converted to an Advance by giving a Accommodation
Notice in accordance with Section 3.02; or (iii) pay, on or before 10:00 a.m.
(Toronto time) on the maturity date for the BA Instrument, an amount in Canadian
Dollars equal to the Face Amount of the BA Instrument (notwithstanding that a
Facility A Lender may be the holder of it at maturity). Any such payment shall
satisfy the Borrower's obligations under the BA Instrument to which it relates
and the relevant Facility A Lender or Participant shall then be solely
responsible for the payment of the BA Instrument.
(2) If the Borrower fails to pay any BA Instrument when due or
issue a replacement in the Face Amount of such BA Instrument pursuant to Section
4.05(1), the unpaid amount due and payable shall be converted to a Prime Rate
Advance made by the Facility A Lenders rateably under the applicable Credit
Facility and shall bear interest calculated and payable as provided in Article
3. This conversion shall occur as of the due date and without any necessity for
the Borrower to give a Borrowing Notice.
SECTION 4.06. CIRCUMSTANCES MAKING BANKERS' ACCEPTANCES
UNAVAILABLE. (1) If, by reason of circumstances affecting the money market
generally, there is no market for Bankers' Acceptances, (i) the right of the
Borrower to request a Drawing shall be suspended until the circumstances causing
a suspension no longer exist; and (ii) any Drawing Notice which is outstanding
shall be deemed to be an Accommodation Notice requesting an Advance comprised of
Prime Rate Advances.
(2) The Administrative Agent shall promptly notify the
Borrower of the suspension of the Borrower's right to request a Drawing and of
the termination of any suspension.
SECTION 4.07. DEPOSITORY BILLS AND NOTES ACT. Bankers'
Acceptances may be issued in the form of a depository xxxx and deposited with a
clearing house, both terms as defined in the DEPOSITORY BILLS AND NOTES ACT. The
Administrative Agent and the Borrower shall agree on the procedures to be
followed, acting reasonably. The Facility A Lenders are also authorized
43
to issue depository bills as replacements for previously issued Bankers'
Acceptances, on the same terms as those replaced, and deposit them with a
clearing house against cancellation of the previously issued Bankers'
Acceptances.
ARTICLE 5
LETTERS OF CREDIT
SECTION 5.01. LETTERS OF CREDIT. (1) The Issuing Lender
agrees, in reliance upon the terms and subject to the conditions of this
Agreement (and in accordance with the standard terms and conditions represented
by any agreement (including the Issuing Lender's standard Letter of Credit
Application Form, as defined below) that may be entered into between the
Borrower and the Issuing Lender from time to time, including the payment of
administrative fees and costs), to issue Letters of Credit for the account of
the Borrower from time to time on any Business Day prior to the eighth-to-last
day of the Term of Facility A, which Letter of Credit shall expire on the
earlier of (a) one year from issuance, or (b) 7 days prior to the expiry of the
Term of Facility A. The issuance of any such Letter of Credit shall require two
(2) Business Days' prior notice to the Administrative Agent and the Issuing
Lender, which notice shall be accompanied by the Issuing Lender's standard
Letter of Credit application form, duly completed and executed by the Borrower.
The Borrower shall pay, in respect of any such Letter of Credit, fees equal to
the aggregate of: (i) for the Facility A Lenders, the Applicable Margin
multiplied by the Face Amount thereof (and taking into account the number of
days until the expiry date thereof), and (ii) for the Issuing Lender, 1/8% per
annum of the Face Amount thereof (taking into account the number of days until
the expiry date thereof), payable in advance on the date of issuance, or on such
other date as the Administrative Agent and the Issuing Lender may determine from
time to time.
(2) For greater certainty, the Issuing Lender shall not be
obliged to issue any Letter of Credit if as a result (a) the Accommodations
Outstanding under Facility A would exceed the Facility A Commitments, (b) the
Issuing Lender's or any other Lender's Facility A Commitment would be exceeded,
(c) the amount of Accommodations Outstanding by way of Letters of Credit would
exceed Cdn. $2,000,000, (d) a Law or an order, judgment or decree of a
Governmental Entity would be breached or would prohibit such issuance, (e) the
Issuing Lender or other Facility A Lenders would incur increased costs of the
nature referred to in Section 12.06 in respect of which they would not be
indemnified by the Borrower, (f) the policies of the Issuing Lender would be
breached.
(3) The Issuing Lender's Letter of Credit Application Form and
any form pertaining to amendments of any Letter of Credit (collectively, the
"LETTER OF CREDIT APPLICATION FORM") shall require, INTER ALIA, (A) the proposed
issuance date of the requested Letter of Credit (which shall be a Business Day);
(B) the amount thereof; (C) the expiry date thereof; (D) the name and address of
the beneficiary thereof; (E) the documents to be presented by such beneficiary
in case of any drawing thereunder; (F) the full text of any certificate to be
44
presented by such beneficiary in case of any drawing thereunder; and (G) such
other matters as the Issuing Lender may require.
(4) Promptly after receipt of any Letter of Credit
Application, the Issuing Lender will confirm with the Administrative Agent (by
telephone or in writing) that the Administrative Agent has received a copy of
such Letter of Credit Application from the Borrower and, if not, the Issuing
Lender will provide the Administrative Agent with a copy thereof. Upon receipt
by the Issuing Lender of confirmation from the Administrative Agent that the
requested issuance or amendment is permitted in accordance with the terms
hereof, then, subject to the terms and conditions hereof, the Issuing Lender
shall, on the requested date, issue a Letter of Credit for the account of the
Borrower in accordance with the Issuing Lender's usual and customary business
practices, and immediately thereupon, each Lender shall be deemed to, and
irrevocably and unconditionally agrees to, purchase from the Issuing Lender a
risk participation in such Letter of Credit in an amount equal to its rateable
share of same.
SECTION 5.02. REIMBURSEMENTS OF AMOUNTS DRAWN. (1) At or
before 10:00 a.m. (Toronto time) on the earlier of (i) the date specified by a
beneficiary thereof (a "BENEFICIARY") as a drawing date under a Letter of
Credit; and (ii) the last day of the Term of Facility A, the Borrower shall pay
to the Issuing Lender an amount in same day funds equal to the amount to be
drawn by the Beneficiary in Canadian Dollars.
(2) If the Borrower fails to pay to the Issuing Lender an
amount, in same day funds, equal to the amount of such drawing, then (i) the
Borrower shall be deemed to have given a Borrowing Notice to the Administrative
Agent, requesting a Prime Rate Advance under Facility A in an amount equal to
the amount of such drawing; (ii) the Facility A Lenders shall, on the date of
such drawing, make such Prime Rate Advance, rateably under Facility A; and (iii)
the Administrative Agent shall pay the proceeds thereof to the Issuing Lender as
reimbursement for the amount of such drawing.
(3) Each Facility A Lender shall be required to make the Prime
Rate Advances referred to in Section 5.02(2) notwithstanding (i) the amount of
the Prime Rate Advance in question may not comply with the minimum amount
required for Advances hereunder; (ii) whether any conditions specified in
Article 6 are then satisfied; (iii) whether a Default has occurred and is
continuing or whether an Event of Default has occurred; (iv) the date of such
Prime Rate Advance; (v) any reduction in the Facility A Commitment; (vi) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against the Issuing Lender, the Borrower or any other Person for any reason
whatsoever; (vii) whether the Facility A Commitment has been, or, after the
making of such Prime Rate Advance, will be, exceeded; and (viii) any other
occurrence, event or condition, whether or not similar to any of the foregoing.
SECTION 5.03. RISK OF LETTERS OF CREDIT. (1) In determining
whether to pay under a Letter of Credit, the Issuing Lender shall be responsible
only to determine that the documents and certificates required to be delivered
under the Letter of Credit have been delivered and that they comply on their
face with the requirements of the Letter of Credit.
45
(2) The reimbursement obligation of the Borrower under any
Letter of Credit shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including (i) any lack of validity or enforceability of a Letter of Credit or
any Credit Document; (ii) the existence of any claim, set-off, defence or other
right which the Borrower may have at any time against a Beneficiary, the Issuing
Lender or any other Person, whether in connection with the Credit Documents and
the transactions contemplated therein or any other transaction (including any
underlying transaction between such Borrower and the Beneficiary); (iii) any
certificate or other document presented with a Letter of Credit proving to be
forged, fraudulent or invalid or any statement in it being untrue or inaccurate,
or any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under such Letter of Credit; (iv) the existence of
any act or omission or any misuse of, a Letter of Credit or misapplication of
proceeds by the Beneficiary, including any fraud in any certificate or other
document presented with a Letter of Credit in each case unless, before payment
of a Letter of Credit, (a) the Borrower has delivered to the Issuing Lender a
written notice of the fraud together with a written request that it refuse to
honour such drawing, (b) the fraud by the Beneficiary has been established to
the knowledge of the Issuing Lender so as to make the fraud clear or obvious to
the Issuing Lender, and (c) in the case of fraud in the underlying transaction
between the Borrower and the Beneficiary, the fraud is of such character as to
make the demand for payment by the Beneficiary under the Letter of Credit a
fraudulent one; (v) payment by the Issuing Lender under the Letter of Credit
against presentation of a certificate or other document which does not comply
with the terms of the Letter of Credit unless such payment constitutes gross
negligence or wilful misconduct of the Issuing Lender; (vi) any payment made by
the Issuing Lender under such Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to any
beneficiary or any transferee of such Letter of Credit, including any arising in
connection with any proceeding under any Law dealing with bankruptcy, insolvency
or arrangements with creditors; (vii) any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Borrower; or (viii) the existence of a Default or Event of
Default.
(3) The Borrower shall promptly examine a copy of each Letter
of Credit and each amendment thereto that is delivered to it and, in the event
of any claim of noncompliance with the Borrower's instructions or other
irregularity, the Borrower will immediately notify the Issuing Lender. The
Borrower shall be conclusively deemed to have waived any such claim against the
Issuing Lender and its correspondents unless such notice is given as aforesaid.
(4) The Issuing Lender shall not be responsible for (i) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
under it or proceeds of it, in whole or in part, which may prove to be invalid
or ineffective for any reason; (ii) errors, omissions, interruptions or delays
in transmission or delivery of any messages by mail, telecopy or otherwise;
(iii) errors in interpretation of technical terms; (iv) any loss or delay in the
transmission of any document required in order to make a drawing; and (v) any
consequences arising from causes beyond the control of the Issuing Lender,
including the acts or omissions, whether rightful or wrongful, of any
Governmental Entity. None of the above shall affect, impair, or prevent the
vesting of any of
46
the Issuing Lenders' rights or powers under this Agreement. Each Lender and
the Borrower agree that, in paying any drawing under a Letter of Credit, the
Issuing Lender shall not have any responsibility to obtain any document
(other than any sight draft, certificates and documents expressly required by
the Letter of Credit) or to ascertain or inquire as to the validity or
accuracy of any such document or the authority of the Person executing or
delivering any such document. None of the Issuing Lender, any Agent-Related
Person nor any of the respective correspondents, participants or assignees of
the Issuing Lender shall be liable to any Lender for (i) any action taken or
omitted in connection herewith at the request or with the approval of the
Lenders or the Majority Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii)
the due execution, effectiveness, validity or enforceability of any document
or instrument related to any Letter of Credit or Letter of Credit
Application. The Borrower hereby assumes all risks of the acts or omissions
of any beneficiary or transferee with respect to its use of any Letter of
Credit; PROVIDED, HOWEVER, that this assumption is not intended to, and shall
not, preclude the Borrower's pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement.
None of the Issuing Lender, any Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the Issuing Lender,
shall be liable or responsible for any of the matters described in SECTION
5.03(2); PROVIDED, HOWEVER, that anything in such clauses to the contrary
notwithstanding, the Borrower may have a claim against the Issuing Lender,
and the Issuing Lender may be liable to the Borrower, to the extent, but only
to the extent, of any direct, as opposed to consequential or exemplary,
damages suffered by the Borrower which the Borrower proves were caused by the
Issuing Lender's willful misconduct or gross negligence or the Issuing
Lender's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Lender may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the Issuing Lender shall not be responsible
for the validity or sufficiency of any instrument transferring or assigning
or purporting to transfer or assign a Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
SECTION 5.04. REPAYMENTS. (1) If the Borrower is required to
repay the Accommodations Outstanding pursuant to Article 9, then the Borrower
shall pay to the Administrative Agent an amount equal to the Issuing Lender's
contingent liability in respect of (i) any outstanding Letter of Credit; and
(ii) any Letter of Credit which is the subject matter of any order, judgment,
injunction or other such determination (a "JUDICIAL ORDER") restricting payment
under and in accordance with such Letter of Credit or extending the Issuing
Lender's liability under such Letter of Credit beyond its stated expiration
date.
(2) The Issuing Lender shall, with respect to any Letter of
Credit, upon the later of:
(a) the date on which any final and non-appealable order, judgment or
other such determination has been rendered or issued either terminating the
applicable Judicial Order or permanently enjoining the Issuing Lender from
paying under such Letter of Credit; and
47
(b) the earlier of (i) the date on which either (x) the original
counterpart of the Letter of Credit is returned to the Issuing Lender for
cancellation, or (y) the Issuing Lender is released by the Beneficiary from any
further obligations, and (ii) the expiry (to the extent permitted by any
applicable Law) of the Letter of Credit,
pay to the Borrower an amount equal to the amount by which the amount paid to
the Administrative Agent pursuant to Section 5.04(1) exceeds the amounts paid by
the Issuing Lender under the Letter of Credit.
SECTION 5.05. APPLICABILITY OF ISP98 AND UCP. Unless otherwise
expressly agreed by the Issuing Lender and the Borrower when a Letter of Credit
is issued, (i) the rules of the "International Standby Practices 1998" published
by the Institute of International Banking Law & Practice (or such later version
thereof as may be in effect at the time of issuance) shall apply to each standby
Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International Chamber of
Commerce (the "ICC") at the time of issuance (including the ICC decision
published by the Commission on Banking Technique and Practice on April 6, 1998
regarding the European single currency (euro)) shall apply to each commercial
Letter of Credit.
SECTION 5.06. CONFLICT WITH LETTER OF CREDIT APPLICATION.
In the event of any conflict between the terms hereof and the terms of any
Letter of Credit Application, the terms hereof shall control.
ARTICLE 6
CONDITIONS OF LENDING
SECTION 6.01. CONDITIONS PRECEDENT TO THE INITIAL
ACCOMMODATION. The obligation of each Lender to make its initial Accommodation
under the Credit Facilities on or after the date hereof is subject to (i) the
applicable conditions precedent in Section 6.02; and (ii) the condition
precedent that the Administrative Agent and each Lender shall be satisfied with,
or the Borrower or its subsidiaries, shall have delivered to the Administrative
Agent, as the case may be, on or before the day of such initial Accommodation,
the following, in form, substance and dated as of a date satisfactory to the
Lenders and their counsel and in sufficient quantities for each Lender:
(a) certified copies of all of the constating documents, borrowing
by-laws and resolutions of the boards of directors (or any duly authorized
committee thereof) of the Borrower and the Guarantors approving the borrowing
and other matters contemplated by this Agreement and approving the entering into
of all other Credit Documents to which it is a party and the completion of all
transactions contemplated thereunder shall have been provided to the
Administrative Agent, together with all other instruments evidencing necessary
corporate action of the Borrower and of any required Authorization, with respect
to such matters;
48
(b) a certificate of the secretary or an assistant secretary of the
Borrower and each of the Guarantors certifying the names and true signatures of
its officers authorized to sign this Agreement and the other Credit Documents;
(c) a certificate of status, compliance, good standing or like
certificate with respect to the Borrower and each of the Guarantors issued by
the appropriate government officials of the jurisdiction of its incorporation
and of each jurisdiction in which it owns any material assets or carries on any
material business;
(d) certification as to the financial condition and solvency of, and
the absence of Default and compliance with laws and obligations in all material
respects by, the Borrower and each Guarantor, from the chief financial officer
or a senior financial officer of the relevant Person;
(e) there shall not exist (i) any order, decree, judgment, ruling or
injunction which restrains the consummation of the financing contemplated hereby
or (ii) any pending or threatened action, suit, investigation or proceeding
which, if adversely determined, would reasonably be expected to materially
adversely affect the ability of the Borrower or any Guarantor to perform any of
its obligations under the Credit Documents or the ability of the Lenders to
exercise their rights thereunder;
(f) all environmental reports, insurance certificates and such other
reports, audits or certifications as it may reasonably request;
(g) the corporate, capital and ownership structure of the
Borrower and its subsidiaries;
(h) the Borrower shall have provided an irrevocable direction of
payment to the Administrative Agent pursuant to which the Borrower instructs the
Administrative Agent, contemporaneously with the first Accommodation hereunder
and using the proceeds thereof, as well as additional funds to be provided by
the Borrower, to cause the Defeasance of (i) the Existing Credit Agreement and
(ii) the Existing Notes;
(i) all material Liens on the property of the Borrower and its
subsidiaries, other than Permitted Liens, shall have been discharged or, in the
case of subsection (h)(i) above, shall be subject to a binding undertaking to
release same immediately following the repayment thereof, in form and substance
satisfactory to the Administrative Agent and its counsel, and an undertaking
shall have been provided to obtain acknowledgements from certain creditors
concerning the scope of their security;
(j) each of this Agreement and each of the Credit Documents other than
the Hedge Agreements entered into as part of the Hedging Requirements, which may
be entered into within 30 days from the Closing Date, including (i) the Security
Documents listed in Schedule 5 and (ii) guarantees from each of the Guarantors
referred to in Schedule 7, all in form and substance satisfactory to the
Administrative Agent and its counsel, shall have been executed, delivered,
issued or assigned and registered or published, as the case may be; provided
that the Security in
49
place on the Closing Date may exclude certain real property listed in
Schedule 6.01(j) of the Loan Parties having a value (based on municipal tax
evaluations) not exceeding $10,000,000, provided that such real property is
made subject to valid and enforceable first-ranking Liens (subject to
Permitted Liens) in favour of the Administrative Agent on behalf of the
Lenders within 60 days from the Closing Date;
(k) the Administrative Agent shall have received copies of all existing
title and search reports prepared by lawyers or notaries with respect to any
real or immovable property in Canada owned by the Borrower or any of the
Guarantors, as well as updates of such reports, and, within 60 days after the
Closing Date, title reports and updates in respect of all of the Loan Parties'
real properties which were not delivered at the Closing Date, other than those
listed in Schedule 6.01(j), all in form and substance satisfactory to the
Administrative Agent and its counsel; provided that if the Florida Sun is not
sold within 60 days following the Closing Date, such title reports will be
provided concurrently with the granting of the Security on its Assets which is
required to be granted within such delay;
(l) all of the issued and outstanding shares of the subsidiaries of the
Borrower (other than Le Courrier du Sud (1998) Inc.) shall have been pledged in
accordance with the pledges described in Schedule 5, and all of the pledged
shares shall have been remitted to the Administrative Agent;
(m) the Borrower shall have delivered to the Administrative Agent a
certificate signed by an officer stipulating and certifying that:
(i) such officer has taken cognizance of all the terms and
conditions of this Agreement and of all contracts, agreements and deeds
pertaining hereto;
(ii) no Default has occurred or exists hereunder which is
continuing, and no Event of Default has occurred;
(iii) all Collateral is located in the jurisdictions
described in a schedule thereto;
(iv) the corporate structure of the Borrower and its
subsidiaries is as set out in the diagram attached to the certificate;
and
(v) each of the Borrower and its subsidiaries holds the
material Authorizations required in order to permit it to possess its
property and its real estate and to carry on the Business in the manner
in which it is being carried on at present;
(n) nothing shall have occurred since December 31, 2002 which
would reasonably be expected to have a Material Adverse Effect;
(o) all Fees and expenses (including the legal fees and disbursements
of counsel to the Administrative Agent and the Lenders) then payable under the
Credit Documents shall have been paid in full in the currency specified in the
invoice therefor, and the Borrower shall have complied with all of its
obligations to Banc of America Securities LLC under the Commitment
50
Letter and the Fee Letter accepted by the Borrower dated January 13, 2003,
and each such letter shall be in full force and effect;
(p) the Commitments under each of Facility A and Term Facility B shall
have been fully subscribed;
(q) the financing contemplated by the Senior Notes shall have been
issued or shall be concurrently issued on terms reasonably satisfactory to the
Administrative Agent and the Lenders pursuant to definitive documentation in
form and substance reasonably satisfactory to the Administrative Agent;
(r) favourable opinions of counsel to the Borrower and the Guarantors
in form and substance acceptable to the Administrative Agent and its counsel;
and
(s) such other certificates and documentation as the Administrative
Agent may reasonably request.
SECTION 6.02. CONDITIONS PRECEDENT TO ALL ACCOMMODATIONS AND
CONVERSIONS. (1) The obligation of each Lender to make Accommodations or
otherwise give effect to any Accommodation Notice hereunder in respect of
Facility A or the Term Facility B shall be subject to the conditions precedent
that on the date of such Accommodation Notice and Accommodation, and after
giving effect thereto and to the application of any proceeds therefrom, (a) the
representations and warranties contained in Article 7 are true and correct in
all material respects on and as of such date (except where expressly stated to
be made at a particular date), all as though made on and as of such date; (b) no
event or condition has occurred and is continuing, or would result from such
Accommodation or giving effect to such Accommodation Notice, which constitutes a
Default or an Event of Default; and (c) nothing has occurred which would
reasonably be expected to have a Material Adverse Effect.
(2) Each of the giving of any Accommodation Notice by the
Borrower and the acceptance by the Borrower of any Accommodation shall be deemed
to constitute a representation and warranty by the Borrower that, on the date of
such Accommodation Notice or Accommodation, as the case may be, and after giving
effect thereto and to the application of any proceeds therefrom, the statements
set forth in Section 6.02(1) are true and correct.
SECTION 6.03. NO WAIVER. The making of an Accommodation or
otherwise giving effect to any Accommodation Notice hereunder, without the
fulfilment of one or more conditions set forth in Section 6.01 or 6.02, shall
not constitute a waiver of any such condition, and the Administrative Agent and
the Lenders reserve the right to require fulfilment of such condition in
connection with any subsequent Accommodation Notice or Accommodation.
51
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
SECTION 7.01. REPRESENTATIONS AND WARRANTIES. The Borrower
represents and warrants to each Lender, acknowledging and confirming that each
Lender is relying thereon without independent inquiry in entering into this
Agreement and providing Accommodations hereunder, that:
(a) INCORPORATION AND QUALIFICATION. The Borrower and each of the
Guarantors is a corporation duly incorporated, continued or amalgamated as the
case may be, and validly existing under the laws of the jurisdiction referred to
in Schedule 7.01(a) and each is duly qualified, licensed or registered to carry
on business under the Laws applicable to it in all jurisdictions in which the
nature of its Assets or business makes such qualification necessary and where
failure to be so qualified would reasonably be expected to have a Material
Adverse Effect.
(b) CORPORATE POWER. The Borrower and each of the Guarantors has all
requisite corporate power and authority to (i) own and operate its properties
and Assets and to carry on the Business and any other business as now being
conducted by it; and (ii) enter into and perform its obligations under this
Agreement and the other Credit Documents to which it is a party.
(c) CONFLICT WITH OTHER INSTRUMENTS. The execution and delivery of the
Credit Documents by the Borrower and each of the Guarantors which is a party
thereto and the performance by the Borrower and each of the Guarantors of their
respective obligations thereunder and compliance with the terms, conditions and
provisions thereof, will not (i) conflict with or result in a breach of any of
the terms, conditions or provisions of (A) its constating documents or by-laws,
(B) to a material extent, any applicable Law, (C) any material contractual
restriction binding on or affecting it or its properties, or (D) any material
judgment, injunction, determination or award which is binding on it; or (ii)
result in, require or permit (A) the imposition of any Lien in, on or with
respect to the Assets now owned or hereafter acquired by it (other than pursuant
to the Security Documents or which is a Permitted Lien), (B) the acceleration of
the maturity of any material Debt of the Borrower or any of its subsidiaries or
Holdco binding on or affecting it, or (C) any third party to terminate or
acquire any rights materially adverse to the Borrower or its subsidiaries, taken
as a whole, under any Material Agreement.
(d) AUTHORIZATION, GOVERNMENTAL APPROVALS, ETC. The execution and
delivery of each of the Credit Documents by the Borrower and each of the
Guarantors which is a party thereto and the performance by each such Person of
its respective obligations hereunder and thereunder have been duly authorized by
all necessary corporate action and no Authorization (except such the absence of
which would not reasonably be expected to have a Material Adverse Effect) under
any applicable Law, and no registration, qualification, designation, declaration
or filing with any Governmental Entity, is or was necessary therefor or to
perfect the same, except
52
as are in full force and effect, unamended, at the date hereof (or as may
become necessary subsequent to the date hereof and notice of which has been
given to the Administrative Agent).
(e) EXECUTION AND BINDING OBLIGATION. This Agreement and the other
Credit Documents have been duly executed and delivered by the Borrower and each
of the Guarantors which is a party thereto and constitute legal, valid and
binding obligations of such Person, enforceable against it in accordance with
their respective terms, subject only to any limitation under applicable Laws
relating to (i) bankruptcy, insolvency, reorganization, moratorium or creditors'
rights generally; (ii) the discretion that a court may exercise in the granting
of equitable remedies; and (iii) such qualifications with respect to the limited
effect of certain Security taken, which in any event duplicates other Security
taken in different jurisdictions, as may be contained in the opinion of the
Borrower's legal counsel delivered at the Closing Date.
(f) CONDUCT OF BUSINESS. Since December 31, 2002 and up to the Closing
Date, the Business has been carried on in the ordinary course. The Borrower and
its subsidiaries are not engaged in the business of extending credit for the
purpose of purchasing or carrying "margin stock", as defined in Federal Reserve
System Board of Governors Regulation U, and no proceeds of any Accommodations
will be used to purchase or carry any equity security of a class which is
registered pursuant to Section 12 of the U.S. SECURITIES EXCHANGE ACT OF 1934,
as amended, or any such margin stock, or for a purpose which violates, or would
be inconsistent with, Federal Reserve System Board of Governors Regulation T, U
or X. Terms used in this Section and in Section 3.1 for which meanings are
provided in Federal Reserve System Board of Governors Regulation T, U or X or
any regulations substituted therefor, as from time to time in effect, have the
meaning so provided. None of the Borrower and its subsidiaries is an "investment
company" or an "affiliated person" of, or "promoter" or "principal underwriter"
for, an "investment company", as such terms are defined in the INVESTMENT
COMPANY ACT OF 1940, as amended (15 U.S.C. ss. 80a-1 ET SEQ.). The application
of the proceeds of the Accommodations and repayment of the Accommodations
Outstanding by the Borrower and the performance by the Borrower of its
obligations hereunder and under the other Credit Documents and by the Guarantors
under the Credit Documents provided by them will not violate any provision of
the said Act, or any rule, regulation or order issued by the United States
Securities and Exchange Commission thereunder. Neither the Borrower nor any of
its subsidiaries is subject to regulation under the PUBLIC UTILITY HOLDING
COMPANY ACT OF 1935, the FEDERAL POWER ACT or the INTERSTATE COMMERCE ACT, or
under any other Law which may limit its ability to incur Debt or which may
otherwise render its obligations hereunder or under the other Credit Documents
unenforceable.
(g) LOCATION OF BUSINESS. As of the date hereof, the only jurisdictions
(or registration districts within such jurisdictions) in which the Borrower or
any of the Guarantors has any place of business or stores any material tangible
personal property are as set forth in Schedule 7.01(g). The minute books of each
Loan Party are located at the addresses set out in part II of Schedule 7.01(g).
(h) AUTHORIZATIONS, ETC. The Borrower and each of the Guarantors
possess all material Authorizations of federal, provincial, state and local
governments and regulatory
53
authorities as may be necessary to properly conduct the Business, the failure
of which to possess would reasonably be expected to have a Material Adverse
Effect.
(i) TRADEMARKS, PATENTS, ETC. Except as notified to the Administrative
Agent, the patents, trademarks, trade names and copyrights described in Schedule
7.01(i) are the only such registered intellectual property material to the
Business and are owned (as at the Closing Date or from time to time thereafter)
by the Borrower or its subsidiaries. The Borrower and each of the Guarantors
possess all other material trademarks, trade names, copyrights, patents,
licences, or rights in any thereof, reasonably necessary for the conduct of the
Business as now conducted and presently proposed to be conducted. To the best
knowledge of the Borrower and except as disclosed in Schedule 7.01(i), neither
it nor any of its subsidiaries is, as of the Closing Date, infringing or is
alleged to be infringing on the rights of any Person with respect to any patent,
trademark, trade name, copyright (or any application or registration respecting
any thereof), discovery, improvement, process, formula, know-how, data, plan,
specification, drawing or the like, except where such infringement could not
reasonably be expected to have a Material Adverse Effect.
(j) OWNERSHIP OF PROPERTY. The Borrower and each of its subsidiaries
owns its Assets with good (and, with respect to any immovable or real property,
marketable) title thereto, free and clear of all Liens, except for Permitted
Liens. Neither the Borrower nor any of the Guarantors owns any real property
other than the Owned Properties (except as notified in writing to the
Administrative Agent) and is not bound by any agreement to own or lease any
immovable or real property providing for the payments of annual rent in excess
of $500,000 except for the Leases.
(k) LEASED PROPERTIES. Each Lease in respect of the Leased Properties,
as it applies to the Borrower or any of the Guarantors, is in good standing in
all material respects and all amounts owing thereunder having been paid by the
Borrower or the Guarantor, to the extent that the failure to so comply would
reasonably be expected to have a Material Adverse Effect.
(l) EXPROPRIATION. No part of the Owned Properties or the Leased
Properties has been taken or expropriated by any Governmental Entity, nor has
any written notice or proceeding in respect thereof been given or commenced nor
is the Borrower aware of any intent or proposal to give any such notice or
commence any proceedings, in each case, which would reasonably be expected to
have a Material Adverse Effect.
(m) ENCROACHMENTS. The Buildings and Fixtures are located entirely
within the Owned Properties and the Leased Properties in conformity with
applicable set-back and coverage requirements and no dwellings of abutting
owners encroach upon the Owned Properties or the Leased Properties, in each
case, which would reasonably be expected to have a Material Adverse Effect.
(n) COMPLIANCE WITH LAWS. As of the Closing Date, subject to the next
following sentence, the Borrower and each of the Guarantors is in compliance
with all applicable Laws, non-compliance with which would reasonably be expected
to have a Material Adverse Effect.
54
Except as would not reasonably be expected to have a Material Adverse Effect,
the Borrower's and the Guarantors' Business, Owned Properties, Leased
Properties and other Assets (i) are in material compliance with all
Environmental Laws; (ii) possess and are operated in compliance with all
Environmental Permits which are required for the operation of the Business;
and (iii) are not subject to any past or present fact, condition or
circumstance that could result in any material liability under any
Environmental Laws.
(o) SUBSIDIARIES, ETC. Except as set forth in Schedule 7.01(o), as of
the date hereof, the Borrower is the beneficial owner, directly or through other
Guarantors, of all of the issued and outstanding shares of each of the
Guarantors. No Person (other than the Borrower) has any right or option to
purchase or otherwise acquire any of the issued and outstanding shares of the
Guarantors. Except as set forth in Schedule 7.01(o), the Borrower does not own
or hold any shares of, or any other interest in, any other Person.
(p) NO BURDENSOME AGREEMENTS. Neither the Borrower nor any of the
Guarantors is a party to any agreement or instrument or subject to any
restriction (including any restriction set forth in its constating documents or
by-laws) which would reasonably be expected to have a Material Adverse Effect.
(q) NO LITIGATION. There are no investigations, actions, suits or
proceedings pending, taken or, to the Borrower's knowledge, threatened, before
or by any Governmental Entity or by any other Person, in Canada or elsewhere,
which would reasonably be expected to have a Material Adverse Effect.
(r) PENSION PLANS AND EMPLOYMENT LIABILITIES. Schedule 7.01(r) contains
a list of all pension plans of the Borrower and the Guarantors as at the Closing
Date. All contributions required under applicable law under all pension plans in
respect of which a Loan Party could be liable have been made, except for amounts
not material to the Loan Parties on a consolidated basis. Each such plan was
fully funded as of the most recent actuarial assessment on a going concern and
solvency basis in accordance with the terms of such pension plan, except for
amounts not material to the Loan Parties on a consolidated basis. All
obligations (including wages, salaries, commissions and vacation pay) to current
employees and to former employees have been paid in full or duly provided for,
except for amounts not material to the Loan Parties on a consolidated basis.
(s) MATERIAL AGREEMENTS. Neither the Borrower nor any of the Guarantors
is a party or otherwise subject to or bound or affected by any Material
Agreement (other than collective agreements), except as set out in Schedule
7.01(s). Except as contemplated hereunder, all Material Agreements are in full
force and effect, unamended, and neither the Borrower nor any of its
subsidiaries, or to the best of the Borrower's knowledge after due enquiry, any
other party to any such agreement, is in material default with respect thereto.
(t) FINANCIAL STATEMENTS. The audited consolidated financial statements
of the Borrower dated December 31, 2002 and the other financial statements
delivered to the Administrative Agent pursuant to Section 8.01 have been
prepared in accordance with GAAP
55
applied on a consistent basis throughout the periods specified (except as
noted thereon) and are an accurate representation of the consolidated
financial position of the Borrower and its subsidiaries as of the respective
dates specified and the results of their operations and changes in financial
position for the respective periods specified, all in accordance with GAAP.
No material adverse change in the financial results of the Borrower and its
subsidiaries, considered on a consolidated basis, has occurred since December
31, 2002.
(u) BOOKS AND RECORDS. All books and records of the Borrower and each
of its subsidiaries have been fully, properly and accurately kept and completed
in accordance with GAAP (to the extent applicable) and there are no material
inaccuracies or discrepancies of any kind contained or reflected therein. The
Borrower's and each of its subsidiaries' records, systems, controls, data or
information are not recorded, stored, maintained, operated or otherwise wholly
or partly dependent upon or held by any means (including any electronic,
mechanical or photographic process, whether computerized or not) which
(including all means of access thereto and therefrom) are not under the direct
control of the Borrower or of an Affiliate of the Borrower, unless such means do
not prevent the Borrower from having access to same at all times (for example,
in the context of an outsourcing agreement).
(v) INSURANCE. Each of the Borrower and the Guarantors has contracted
the insurance coverage required pursuant to Section 8.01(n).
(w) SOLVENCY. The Borrower and each of the Guarantors, on a
consolidated and consolidating basis, both before giving effect to the
transactions contemplated by this Credit Agreement and the other Credit
Documents and after giving effect to same, including the provisions of all
contribution agreements among the Borrower and the Guarantors (a) is solvent,
(b) the fair value of the Assets of each such Person exceeds its total
liabilities (including Contingent Obligations but without duplication of any
underlying liability related thereto), (c) does not intend to, and does not
believe that it will, incur debts or liabilities beyond its ability to pay as
such debts and liabilities mature; and (d) is not engaged, and is not about to
engage, in business or transactions for which its property would constitute
unreasonably small capital.
(x) TAX LIABILITY. The Borrower and each of the Guarantors has filed
within the prescribed delays all tax returns which are required to be filed, and
all taxes, Claims, assessments and other duties, interest and penalties levied
by the various Governmental Authorities with respect to the Borrower and its
subsidiaries have been paid when due, except for any such assessment, tax or
Claim (i) in an amount of up to $2,500,000 in the aggregate outstanding at any
time; or (ii) (A) which is being contested in good faith by proper legal
proceedings, for which adequate reserves have been established in the books of
the Borrower or the relevant Guarantor, and (B) the failure to effect such
filings or outcome of the contestation of which would not reasonably be expected
to have a Material Adverse Effect.
(y) CORPORATE STRUCTURE. Except as notified to the Lenders, the only
direct and indirect, shareholders of the Borrower (other than shareholders of
Quebecor) are set forth in Schedule 7.01(y). Schedule 7.01(y) sets forth the
complete particulars at the date hereof of (i) such shareholders; (ii) the
interest of each shareholder in the Borrower; and (iii) the direct and indirect
56
interests of each shareholder (other than Quebecor) and their respective
interests. Except as described in Schedule 7.01(y), none of the shareholders is
a party to any unanimous shareholders or other agreement relating to the shares
owned by such shareholder.
(z) CONTINGENT OBLIGATIONS AND INDEBTEDNESS. Neither the Borrower nor
any of its subsidiaries has (a) any material Contingent Obligations or
contingent liabilities known to it which are not disclosed or referred to in the
most recent financial statements delivered to the Administrative Agent in
accordance with the provisions of Section 8.01 or otherwise disclosed to the
Administrative Agent in writing, or (b) incurred any material indebtedness which
is not disclosed in or reflected in such financial statements, or otherwise
disclosed to the Administrative Agent in writing, other than Contingent
Obligations, contingent liabilities or indebtedness incurred in the ordinary
course of business and Permitted Debt.
(aa) DISCLOSURE. All (i) forecasts and projections supplied to the
Administrative Agent and the Lenders were prepared in good faith, disclosed all
assumptions relevant thereto and are, in the opinion of the Borrower's
management when taken together, reasonable estimates (as of the Closing Date) of
the prospects for the Business; and (ii) other written information heretofore
supplied to the Administrative Agent and the Lenders by the Borrower is complete
and accurate in all material respects. There is no fact known as of the Closing
Date to the Borrower, after reasonable investigation, which would reasonably be
expected to have a Material Adverse Effect and which has not been fully
disclosed in writing to the Administrative Agent and the Lenders. There has been
no change which has had or would reasonably be expected to have a Material
Adverse Effect since December 31, 2002 and up to the Closing Date.
SECTION 7.02 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties herein set forth or contained in any certificates
or documents delivered to the Administrative Agent and the Lenders pursuant
hereto shall not merge in or be prejudiced by and shall survive any
Accommodation hereunder and shall continue in full force and effect (as of the
date when made or deemed to be made) so long as any amounts are owing by the
Borrower to the Lenders hereunder. Schedules requiring updates shall be so
updated not less frequently than quarterly.
ARTICLE 8
COVENANTS OF THE BORROWER
SECTION 8.01. AFFIRMATIVE COVENANTS. So long as any amount
owing hereunder remains unpaid or any Lender has any obligation under this
Agreement, and unless consent is given in accordance with Section 12.01 hereof,
the Borrower shall:
(a) FINANCIAL REPORTING REQUIREMENTS. Furnish to the Administrative
Agent (in electronic and paper forms) (i) as soon as practicable, and in any
event within 60 days after the end of each of the first three Financial Quarters
in each Financial Year, unaudited consolidated
57
financial statements of the Borrower, consisting of (A) a consolidated
balance sheet as at the end of the Financial Quarter with comparative amounts
at the end of the corresponding Financial Quarter in the previous Financial
Year, (B) consolidated statements of earnings, retained earnings and cash
flow for the Financial Quarter and for the period from the end of the
previous Financial Year to the end of the Financial Quarter with comparative
amounts for the corresponding periods in the previous Financial Year; (ii) as
soon as practicable, and in any event within 90 days after the end of each
Financial Year, audited consolidated financial statements of the Borrower,
consisting of (A) a consolidated balance sheet as at the end of the Financial
Year with comparative amounts at the end of the previous Financial Year, (B)
consolidated statements of earnings, retained earnings and cash flow for the
Financial Year with comparative amounts for the previous Financial Year, (C)
the audit report of the Borrower's independent auditors on the financial
statements specified in (ii)(A) and (B); (iii) as soon as practicable, and in
any event within 60 days after the end of each of the first three Financial
Quarters in each Financial Year, a Compliance Certificate and a certificate
(in such form and providing such detail as the Administrative Agent may
reasonably require) as to Excess Cash Flow for such Financial Quarter,
calculated (A) in respect of the preceding Financial Quarter and (B) in
respect of the four Financial Quarters (an "EXCESS CASH FLOW CERTIFICATE");
and (iv) as soon as practicable, and in any event within 90 days after the
end of each Financial Year, a Compliance Certificate and an Excess Cash Flow
Certificate.
(b) ENVIRONMENTAL REPORTING. Promptly, and in any event within 10 days
of each occurrence, (i) notify the Administrative Agent of any proceeding or
order before any Governmental Entity requiring the Borrower or the Guarantors to
comply with or take action under any Environmental Laws and of any state or
affairs on the Owned Properties, Leased Properties or the Business which would
reasonably be expected to give rise to a future Claim, and (x) requiring
expenditures in the amount of $2,000,000 or more, (y) if any violation thereof
involves the reasonable possibility of the imposition of a fine or fines
aggregating $500,000 or more, or (z) the shutting down of any material facility
referred to in Schedule 7.01(j) or 7.01(k) for a period in excess of 48 hours;
and (ii) notify the Administrative Agent and the Lenders, within 10 days
therefrom, of any other occurrence which would reasonably be expected to have a
Material Adverse Effect, including the Borrower or any of its subsidiaries (A)
receiving a notice or claim to the effect that the Borrower or any of its
subsidiaries are liable to any Person in a material amount as a result of the
Release or threatened Release of any Hazardous Substance into the environment
in, on, under or adjacent to the Owned Properties or Leased Properties; (B)
receiving any notice that the Borrower or any of its subsidiaries is subject to
investigation by any Governmental Entity evaluating whether any Remedial Action
is needed to respond to the Release or threatened Release of any Hazardous
Substance into the environment, in, on, under or adjacent to the Owned
Properties or the Leased Properties; (C) receiving any notice that all or any
portion of the Owned Properties or the Leased Properties is subject to an order
or a Security Interest under or pursuant to any Environmental Law; (D) receiving
any notice of a material condition with respect to the Owned Properties or the
Leased Properties which might reasonably result in a notice of violation of any
Environmental Law; (E) receiving any notice of the commencement of any judicial
or administrative proceeding alleging a violation of any Environmental Law with
respect to the Owned Properties or the Leased Properties; or (F)
58
undertaking any material activities as a result of new or proposed changes to
any existing Environmental Law that would reasonably be expected to have a
Material Adverse Effect.
(c) ADDITIONAL REPORTING REQUIREMENTS. Deliver to the Administrative
Agent (i) as soon as practicable and in any event not more than 60 days after
the end of each Financial Year of the Borrower, the Annual Business Plan for the
next Financial Year together with detailed schedules and information
supplementary to and consistent with such Annual Business Plan; (ii) as soon as
possible, and in any event within five days after the Borrower becomes aware of
the occurrence of each Default or Event of Default, a statement of the chief
financial officer, treasurer or chief operating officer of the Borrower or any
other officer acceptable to the Administrative Agent setting forth the details
of such Default or Event of Default and the action which the Borrower proposed
to take or has taken with respect thereto; (iii) promptly notify the
Administrative Agent in writing of any default, or event, condition or
occurrence which with notice or lapse of time, or both, would constitute a
default under any agreement in respect of Debt to which the Borrower or any of
its subsidiaries owes (contingently or otherwise) at least $10,000,000 (or the
equivalent amount in any other currency); (iv) from time to time upon request of
the Administrative Agent, evidence of maintenance of all insurance required to
be maintained by Section 8.01(o), including such originals or copies as the
Administrative Agent may reasonably request of policies, certificates of
insurance, riders and endorsements relating to such insurance and proof of
premium payments; (v) promptly upon the issuance thereof, copies of all notices
and other documents in respect of the Borrower or the Guarantors filed with, or
delivered to, any stock exchange or to the Quebec or Ontario Securities
Commission or similar Governmental Entity in any other jurisdiction (with the
exception of any private and confidential filings) by the Borrower or any
Guarantor; (vi) promptly, and in any event within 10 days after the Borrower or
any of its subsidiaries receives notice of any suit, proceeding or similar
action commenced or threatened by any Governmental Entity or any other Person,
which would reasonably be expected to have a Material Adverse Effect; and (vii)
such other information respecting the condition or operations, financial or
otherwise, of the business of the Borrower or any of its subsidiaries as the
Administrative Agent, on behalf of the Lenders, may from time to time reasonably
request.
(d) CORPORATE EXISTENCE. Except as permitted pursuant to Section
8.02(c), preserve and maintain, and cause each of the Guarantors to preserve and
maintain, its corporate existence.
(e) COMPLIANCE WITH LAWS, ETC. Comply, and cause each of the Guarantors
to comply, with the requirements of all applicable Laws, non-compliance with
which would reasonably be expected to have a Material Adverse Effect.
(f) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and cause
each of the Guarantors to maintain and preserve, all of its and their respective
properties used or useful in its Business in all material respects in good
repair, working order and condition (reasonable wear and tear excepted) and,
from time to time, make all needful and proper repairs, renewals, replacements,
additions and improvements thereto, so that the Business may be properly and
advantageously conducted at all time in accordance with prudent business
management.
59
(g) STATUS OF ACCOUNTS AND COLLATERAL. With respect to the
Collateral (i) maintain books and records pertaining to the Collateral in
such detail, form and scope as the Administrative Agent shall reasonably
require; (ii) immediately notify the Administrative Agent of any Governmental
Entity in respect of which accounts in excess of $2,000,000 may arise at any
time or from time to time (other than amounts owed to the Borrower or such
Guarantor by such Governmental Entity), and execute any instruments and take
any steps required by the Administrative Agent in order that all moneys due
or to become due from time to time from such Governmental Entities are
assigned to the Lenders and notice thereof be given to any such Governmental
Entity; and (iii) report immediately to the Administrative Agent any matters
materially adversely affecting the value, enforceability or collectability of
any of the Collateral.
(h) CONDUCT OF BUSINESS AND HEDGING REQUIREMENTS. Conduct, and cause
each of the Guarantors to conduct, in each Financial Year, the Business in a
prudent manner and consistent with good business practices. Maintain the
Hedging Requirements.
(i) ENVIRONMENTAL AUDITS. Promptly (i) if the Administrative Agent
has a good faith concern that there is non-compliance by the Borrower or any
of its subsidiaries with Environmental Laws which would reasonably be
expected to have a Material Adverse Effect, conduct such environmental audits
(by an environmental auditor or auditors approved by the Administrative Agent
and, prior to the occurrence of an Event of Default which is continuing, the
Borrower) concerning such alleged material non-compliance as the
Administrative Agent may request and permit the Administrative Agent and the
Lenders to discuss such audits with such auditors; and (ii) remedy any
material non-compliance with Environmental Laws revealed by any such audit.
Such audit shall be at the Borrower's expense.
(j) AUDITORS. Appoint and maintain as its auditors a firm of
national standing.
(k) PAYMENT OF TAXES AND CLAIMS. Pay and discharge, and cause each
of the Guarantors to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or levies
imposed upon it or upon the Assets or upon its subsidiaries; and (ii) all
lawful Claims which, if unpaid, would by Law become a Lien (other than a
Permitted Lien) upon the Assets, except for any such assessment, tax or Claim
(I) in an amount of up to $2,500,000 in the aggregate outstanding at any
time; or (II)(A) which is being contested in good faith by proper legal
proceedings, for which adequate reserves have been established in the books
of the Borrower or the relevant Guarantor, and (B) the outcome of the
contestation of which or the failure to comply with this covenant would not
reasonably be expected to have a Material Adverse Effect.
(l) KEEPING OF BOOKS. Keep, and cause each of the Guarantors to
keep, proper books of record and account, in which full and correct entries
shall be made of all financial transactions and the Assets and Business in
accordance with GAAP (to the extent applicable).
(m) VISITATION AND INSPECTION. At (i) any reasonable time or times
and upon reasonable prior notice, and at least semi-annually, permit the
Administrative Agent on behalf of the Lenders to visit the properties of the
Borrower or any of the Guarantors or the location of the
60
chief financial officer, and to discuss the affairs, finances and accounts of
the Borrower or any of the Guarantors with executive management including the
officer appointed as (or performing the functions of) the chief financial
officer thereof. If a Default has occurred and is continuing or an Event of
Default has occurred and not been waived, the Borrower shall be required to
reimburse the Administrative Agent or its mandatary for any related expenses
and fees; and (ii) at least annually, permit the Lenders to have access to
the Borrower's chief financial officer controller for the purpose of
reviewing the affairs, finances and accounts of the Borrower and its
subsidiaries.
(n) MAINTENANCE OF INSURANCE. Maintain, in respect of itself and
each of the Guarantors, insurance at all times with responsible insurance
carriers in such amounts and covering such risks as are usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas in which the Borrower or any such Guarantor, as the case
may be, operate, such policies to show the Administrative Agent, for and on
behalf of the Lenders, as loss payee thereof under a mortgage clause in a
form approved by the Insurance Bureau of Canada and promptly furnish or cause
to be furnished evidence thereof to the Administrative Agent and the Lenders.
(o) CURE DEFECTS, PRESERVATION OF SECURITY. Take all necessary steps
to preserve and maintain in effect the rights of the Administrative Agent and
the Lenders, as well as any collateral agent designated by the Administrative
Agent, pursuant to the Security Documents, to the extent the Loan Parties
have any knowledge of any deficiency, together with any renewals thereof or
additional documents creating Liens that may be required from time to time.
Upon the reasonable request of the Administrative Agent, promptly cure or
cause to be cured any defects in the execution and delivery of any of the
Credit Documents or any of the other agreements, instruments or documents
contemplated thereby or executed pursuant thereto or any defects in the
validity of enforceability of any of the Security, and at its expense,
execute and deliver or cause to be executed and delivered, all such
agreements, instruments and other documents as the Administrative Agent may
consider necessary or desirable for the foregoing purposes.
(p) FURTHER ASSURANCES. At the Borrower's cost and expense, upon the
reasonable request of the Administrative Agent, duly execute and deliver or
cause to be duly executed and delivered to the Administrative Agent such
further instruments and do and cause to be done such further acts as may be
necessary or proper in the reasonable opinion of the Administrative Agent to
carry out more effectually the provisions and purposes of the Credit
Documents. In addition, if any new subsidiary of the Borrower is created or
acquired, such subsidiary will become a Guarantor and will provide Security
on all of its Assets by executing a guarantee and appropriate Security
Documents in form and substance satisfactory to the Administrative Agent and
its counsel.
SECTION 8.02. NEGATIVE COVENANTS. So long as any amount
owing hereunder remains unpaid or any Lender has any obligation under this
Agreement, and unless consent is given in accordance with Section 12.01
hereof, the Borrower shall not:
61
(a) DEBT. Create, incur, assume or suffer to exist, or permit any of
the Guarantors to create, incur, assume or suffer to exist, any Debt other
than (i) Debt under this Agreement; and (ii) Permitted Debt.
(b) ENCUMBRANCES. Create, incur, assume or suffer to exist, or
permit any of the Guarantors to create, incur, assume or suffer to exist any
Lien on any of its or their, as the case may be, respective Assets, other
than Permitted Liens.
(c) MERGERS, ETC. Enter into, or permit any of the Guarantors to
enter into, any transaction (whether by way of reconstruction,
reorganization, consolidation, amalgamation, winding-up, merger, transfer,
sale, lease or otherwise) whereby all or any substantial part of its
undertaking or Assets would become the property of any other Person (except
that the Loan Parties may enter into any such transaction with each other),
unless (i) immediately after giving effect thereto, no event shall have
occurred and be continuing which constitutes a Default or Event of Default,
(ii) in the case of any transaction involving the Borrower or any Guarantor,
the corporation continuing from any such transaction shall be a corporation
organized and existing under the laws of Canada or any province thereof,
(iii) such continuing corporation shall assume the Borrower's or such
Guarantor's obligation, if any, under the Credit Documents, pursuant to an
agreement in form and substance satisfactory to the Administrative Agent,
provided that such agreement shall not be required if such obligations are
otherwise assumed by operation of Law, (iv) if the transaction in question is
with a Person (A) who was not a subsidiary of a Loan Party immediately before
the effective date thereof, the transaction, in the sole opinion of the
Majority Lenders acting reasonably, would not reasonably be expected to have
a Material Adverse Effect, or (B) who was a subsidiary of a Loan Party
immediately before the effective date thereof, the proposed transaction will
not have a detrimental effect on the financial condition of any of the Loan
Parties, nor on the rights of the Administrative Agent and the Lenders under
the Credit Documents, and (v) the Lenders shall have received an opinion of
counsel to the Borrower, acceptable to them, that such transaction complies
with Law and other matters of Law referred to in this Section 8.02(c), or
except as permitted under Section 8.02(d).
(d) DISPOSAL OF ASSETS GENERALLY. Dispose of, or permit any of the
Guarantors to Dispose of, any Assets to any Person, other than, (i) any
disposition of Assets between the Loan Parties; (ii) pursuant to a
transaction consummated in accordance with Section 8.02(c); (iii)
Dispositions of inventory and other Assets in the ordinary course of
business; (iv) so long as no Default has occurred and is continuing or would
arise therefrom and no Event of Default has occurred, the Disposition of the
Florida Sun at fair market value; (v) so long as no Default has occurred and
is continuing or would arise therefrom and no Event of Default has occurred,
any other BONA FIDE Dispositions at fair market value, provided the proceeds
thereof are dealt with in accordance with Section 2.05(2) hereof to the
extent applicable, and in any event limited to an aggregate maximum amount
during the Term of Facility A or Term Facility B, whichever expires last,
together with all sale and leaseback transactions referred to in clause (vii)
below, of $50,000,000; (vi) Dispositions of Assets which are obsolete, worn
out, surplus, damaged or of no material economic value in the Business; (vii)
sale and leaseback transactions, subject to the limitations in clause (v)
above, and (viii) so long as no Default has occurred and is continuing or
would arise therefrom and no Event of Default has occurred, BONA FIDE
exchanges of similar
62
Assets at fair market value, subject to an aggregate amount of $50,000,000
during the last to expire of the Term of Facility A or of Term Facility B.
(e) TRANSACTIONS WITH AFFILIATES. Subject to the following
sentences, directly or indirectly (i) purchase, acquire, lease or licence any
material property, right or service from; (ii) sell, transfer, lease or
licence any Assets or right to; or (iii) permit any of the Guarantors to
purchase, acquire, lease or licence any Asset, right or service from, or
sell, transfer, lease or licence any material property or right to, any
Person not at Arm's Length with the Borrower or any of the Guarantors, except
at prices and on terms not less favourable to the Borrower or any of the
Guarantors, as the case may be, than those which would have been obtained in
an Arm's Length transaction with an Arm's Length Person. Notwithstanding the
foregoing, (i) the Loan Parties may (A) enter into such transactions with
each other; and (B) make or pay Permitted Distributions, and (ii) the
Borrower may perform its obligations in connection with, or redeem or repay,
the Back-to-Back Securities, the Existing Back-to-Back Securities or the Tax
Benefit Transactions.
(f) CHANGE IN BUSINESS. Make, or permit to be made, any material
change in the Business.
(g) SHARE CAPITAL. Issue, or permit any of the Guarantors to issue,
any shares, or any options, warrants or securities convertible into shares,
except (i) to Quebecor Media Inc. or any Affiliate thereof or any qualifying
shares issued to any directors and officers; and (ii) an issue of shares to
the Borrower or to a Guarantor by a subsidiary of the Borrower.
(h) DISTRIBUTIONS. (1) Declare, make or pay, or permit any of its
subsidiaries to declare, make or pay, any Distributions which are not
Permitted Distributions;
(2) Any payment of a Permitted Distribution of Excess Cash
Flow (an "EXCESS CASH FLOW DISTRIBUTION") shall be deemed to have been made
in the Financial Quarter in respect of which the Excess Cash Flow was
generated, despite the fact that the Excess Cash Flow Distribution can only
be made in the next Financial Quarter based on the Excess Cash Flow
Certificate in respect of the preceding Financial Quarter. At the end of each
Financial Quarter, and at the end of each Financial Year, the Borrower will
deliver the Excess Cash Flow Certificate and a Compliance Certificate in the
manner and at the times contemplated by Section 8.01(a). The Borrower shall
be able to make an Excess Cash Flow Distribution based on the Cash Flow
Certificate delivered in respect of the preceding Financial Quarter. If, as a
result of negative Excess Cash Flow in one or more subsequent Financial
Quarters, the aggregate amount of Excess Cash Flow Distributions validly made
at the end of a previous Financial Quarter exceeds the amount of the Excess
Cash Flow which could be a Permitted Distribution, the Borrower shall not for
this reason alone be in Default hereunder; but no additional Excess Cash Flow
Distribution may be made until such time as a subsequently delivered Excess
Cash Flow Certificate demonstrates that any shortfall in the portion of
Excess Cash Flow which may have been the object of a Permitted Distribution
has been recouped, and that there is additional Excess Cash Flow in excess of
the amount of such shortfall which may at such time be the object of a
Permitted Distribution.
63
(i) LOANS, INVESTMENTS AND ACQUISITIONS. Make any loans (other than
loans to Quebecor Media Inc. made out of Excess Cash Flow, subject to having
first provided to the Administrative Agent an Excess Cash Flow Certificate in
respect of the particular period in question, or out of amounts that could
constitute Additional Distributions), Investments or Acquisitions, (other
than in connection with Capital Expenditures permitted pursuant to Section
8.02(m)), or permit any of the Guarantors to make any such loans, Investments
or Acquisitions, except, in each case, for (i) the Hedging Agreements in
connection with the Hedging Requirements, other Hedging Agreements and other
foreign currency xxxxxx, interest rate swaps or similar interest rate and
currency hedging obligations or agreements, in each case incurred in the
ordinary course of the Business and not for speculative purposes; (ii) loans,
Acquisitions and Investments among the Loan Parties; and (iii) Permitted
Investments.
(j) RENTAL OBLIGATIONS. Incur, create, assume or permit to exist or
permit any of the Guarantors to incur, create, assume or permit to exist, in
respect of any operating lease of real or personal property entered into
after the date hereof, rental obligations or other commitments thereunder to
make any direct or indirect payment in any Financial Year, whether as rent or
otherwise, for fixed or minimal rentals, percentage rentals, property taxes
or insurance premiums, in an aggregate amount greater than $20,000,000.
(k) SUBSIDIARIES. (1) Permit the subsidiaries of the Borrower which
are not Guarantors to be wholly-owned, directly or indirectly, by the
Borrower; or (2) permit the aggregate of such subsidiaries' EBITDA or Assets,
when considered together with the EBITDA or Assets of all other subsidiaries
that are not Guarantors, to exceed 10% of the EBITDA or Assets of the
Borrower on a consolidated basis; for the purposes hereof, "Assets" excludes
the effect of all Back-to-Back Transactions; or (3) permit any Guarantor to
assume, enter into or otherwise become bound by any agreement or undertaking
that would reasonably be expected to prevent such Guarantor from declaring or
paying dividends or inter-company payments or Distributions of any kind.
(l) MAINTENANCE AND OWNERSHIP OF SUBSIDIARIES. Sell or otherwise
dispose of any shares of any of the Guarantors or permit any of the
Guarantors to issue, sell or otherwise dispose of any of their shares or the
shares of any other Guarantor, except to the Borrower or a Guarantor, or
except pursuant to a Disposition permitted hereunder.
(m) CAPITAL EXPENDITURES. Make or commit to make, or permit any of
the Guarantors to make or commit to make, in any Financial Year (or part
thereof), any Capital Expenditures, except (i) Capital Expenditures in an
amount not exceeding $25,000,000 (the "CAPEX LIMIT"); provided that if no
Default has occurred and is continuing and no Event of Default has occurred,
any portion of the Capex Limit which is not used in a Financial Year may be
carried over into the next Financial Year alone, (ii) Capital Expenditures
using Net Proceeds of Dispositions which have not been used to effect a
Mandatory Prepayment or a Permitted Distribution, and (iii) Capital
Expenditures made using insurance, condemnation awards or expropriation
proceeds.
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(n) BUSINESS OUTSIDE CERTAIN JURISDICTIONS. Keep or store any
material tangible property outside of those jurisdictions (or registration
districts within such jurisdictions) set forth in Schedule 7.01(g) or permit
any of the Guarantors to do so (i) except upon 30 days' prior written notice
thereof to the Administrative Agent; and (ii) unless the Borrower has done or
caused to be done all such acts and things and executed and delivered or
caused to be executed and delivered all such deeds, transfers, assignments
and instruments as the Administrative Agent may reasonably require for
perfecting a Security Interest in such property in favour of the
Administrative Agent and the Lenders.
(o) FINANCIAL YEAR. Change its Financial Year.
(p) AMENDMENTS. Allow (i) any amendments to its or any of the
Guarantors' constating documents or by-laws which are adverse to the Lenders
interests hereunder or the Security Interests arising under or created by the
Security Documents; or (ii) any amendments to, or grant any waivers in
respect of the Senior Note Indenture which would be materially adverse to the
position of the Lenders (and in particular, shortening the maturity date
thereof or providing for any prepayment thereof in excess of the amount
permitted as a Permitted Distribution), in each case, without the prior
written consent of the Administrative Agent upon instructions from the
Majority Lenders.
SECTION 8.03. FINANCIAL COVENANTS. So long as any amount owing
hereunder remains unpaid or any Lender has any obligations under this Agreement,
and unless consent is given in accordance with Section 12.01 hereof, the
Borrower shall:
(a) LEVERAGE RATIO. Maintain, at all times, tested as at the end of
each Financial Quarter in each Financial Year, a maximum Leverage Ratio,
calculated as at the end of such Financial Quarter for the four Financial
Quarters then ended, as follows:
--------------------------------------------------------- -----------------------
PERIOD RATIO
--------------------------------------------------------- -----------------------
--------------------------------------------------------- -----------------------
Closing Date to December 31, 2003 3.75:1
--------------------------------------------------------- -----------------------
--------------------------------------------------------- -----------------------
January 1, 2004 to December 31, 2004 3.50:1
--------------------------------------------------------- -----------------------
--------------------------------------------------------- -----------------------
January 1, 2005 to December 31, 2006 3.25:1
--------------------------------------------------------- -----------------------
--------------------------------------------------------- -----------------------
January 1, 2007 and thereafter 2.75:1
--------------------------------------------------------- -----------------------
(b) INTEREST COVERAGE RATIO. Maintain, at all times, tested as at the
end of each Financial Quarter in each Financial Year, a minimum Interest
Coverage Ratio, calculated as at the end of such Financial Quarter for the four
Financial Quarters then ended, as follows:
--------------------------------------------------------- -----------------------
PERIOD RATIO
--------------------------------------------------------- -----------------------
--------------------------------------------------------- -----------------------
Closing Date to December 31, 2004 3.00:1
--------------------------------------------------------- -----------------------
--------------------------------------------------------- -----------------------
January 1, 2005 to December 31, 2006 3.25:1
--------------------------------------------------------- -----------------------
--------------------------------------------------------- -----------------------
January 1, 2007 and thereafter 3.50:1
--------------------------------------------------------- -----------------------
65
(c) FIXED CHARGE COVERAGE RATIO. Maintain, at all times, tested as
at the end of each Financial Quarter in each Financial Year, a minimum Fixed
Charge Coverage Ratio calculated as at the end of such Financial Quarter for
the four Financial Quarters then ended, of not less than 2:1.
ARTICLE 9
EVENTS OF DEFAULT
SECTION 9.01. EVENTS OF DEFAULT. The occurrence of any of
the following events (each an "EVENT OF DEFAULT") shall constitute an Event
of Default unless remedied within the prescribed delays or waived by the
requisite majority of Lenders:
(a) the Borrower shall fail to pay any amount of the Accommodations
Outstanding when such amount becomes due and payable;
(b) the Borrower shall fail to pay any interest or Fees when the
same become due and payable hereunder and such failure shall remain
unremedied for three Business Days;
(c) any representation or warranty or certification made or deemed
to be made by the Borrower or any of the Guarantors or any of their
respective directors or officers in this Agreement or any other Credit
Document to which it is a party shall prove to have been incorrect in any
material respect when made or deemed to be made;
(d) the Borrower shall fail to perform, observe or comply with any
of the covenants contained in (i) Sections 8.02 (a), (b), (f), (g), (i), (j),
(m) or (n), and such failure shall remain unremedied for three (3) Business
Days from the Loan Party's knowledge of such event, or (ii) the other
subsections of Section 8.02, or (iii) Section 8.03;
(e) the Borrower shall fail to perform, observe or comply with any
of the covenants contained in this Agreement and such failure shall remain
unremedied for 15 days following notice thereof by the Administrative Agent
to the Borrower;
(f) the Borrower or any of the Guarantors shall fail to perform or
observe any other term, covenant or agreement contained in any Credit
Document to which it is a party and such failure shall remain unremedied for
15 days following notice thereof by the Administrative Agent to the Borrower;
(g) the Borrower or any of the Guarantors shall fail to perform or
observe any material term, covenant or agreement contained in any Material
Agreement on its part to be performed or observed and, as a result thereof,
any Material Agreement shall be terminated, revoked or permitted to lapse
(other than as approved by the Administrative Agent); or any party to any
Material Agreement shall deliver a notice of termination or revocation in
respect of such Material Agreement to the Borrower or any of its subsidiaries
at any time;
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(h) the Borrower or any of the Guarantors shall fail to pay the
principal of or premium or interest on any Debt of the Borrower or such
Guarantor (excluding any Debt hereunder and under a Hedging Agreement) which
is outstanding in an aggregate principal amount exceeding $25,000,000 (or the
equivalent amount in any other currency), when such amount becomes due and
payable (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise) and such failure shall continue after the applicable
grace period, if any, specified in the agreement or instrument relating to
such Debt which has not been extended, waived or modified; or any other event
shall occur or condition shall exist, and shall continue after the applicable
grace period, if any, specified in any agreement or instrument relating to
any such Debt, if the effect of such event is to accelerate, or permit the
acceleration of such Debt; or any such Debt shall be declared to be due and
payable prior to the stated maturity thereof;
(i) the Borrower or any of the Guarantors shall fail to pay the
principal of or premium or interest on any Debt of the Borrower or such
Guarantor under a Hedging Agreement or under the Overdraft Facility when such
amount becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise) and such failure shall
continue after the applicable grace period, if any, specified in the
agreement or instrument relating to such Debt which has not been extended,
waived or modified, if the effect of such event is to accelerate such Debt;
or any other event shall occur or condition shall exist, and shall continue
after the applicable grace period, if any, specified in any agreement or
instrument relating to any such Debt, if the effect of such event is to
accelerate such Debt;
(j) any seizure, taking of possession, or process of execution is
enforced or levied upon material property having a value of $5,000,000 or
more of the Borrower or any of the Guarantors and remains unsatisfied for a
period (for each action) of 60 days, as to movable or personal property, or
90 days as to immovable or real property, and, in any event, not less than 10
days prior to the date fixed for the sale of any such property;
(k) any judgment or order for the payment of money in excess of
$10,000,000 (or the equivalent amount in any other currency), net of
applicable insurance coverage pursuant to which liability is acknowledged in
writing by the insurer, with a copy promptly provided to the Administrative
Agent, shall be rendered against the Borrower or any of the Guarantors and
remains undischarged or unsatisfied for a period ending on the earlier of (a)
30 days from the date of such judgment (unless appealed and provided, in such
case, that there shall be a stay of enforcement of such judgment or order
during such period); or (b) the 5th day prior to the date on which such
judgment becomes executory;
(l) the Borrower or any of the Guarantors shall (i) become insolvent
or generally not pay its debts as such debts become due; (ii) admit in
writing its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; (iii) institute or have instituted
against it any proceeding seeking (x) to adjudicate it a bankrupt or
insolvent, (y) any liquidation, winding-up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any
Law relating to bankruptcy, insolvency, reorganization or relief of debtors
including any plan of compromise or arrangement or other similar corporate
proceeding involving or effecting its creditors, or (z) the entry of an order
for relief or the
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appointment of a receiver, trustee or other similar official for it or for
any substantial part of its Assets, and in the case of any such proceeding
instituted against it (but not instituted by it), either such proceeding
shall remain undismissed or unstayed for a period of 45 days, or any of the
actions sought in such proceeding (including the entry of an order for relief
against it or the appointment of a receiver, trustee, custodian or other
similar official for it or for any substantial part of its Assets) shall
occur; or (iv) take any corporate action to authorize any of the foregoing
actions;
(m) if any guarantee provided by a Guarantor shall be cancelled,
terminated, revoked or rescinded, or if any of the Credit Documents shall be
cancelled, terminated, revoked or rescinded or the Administrative Agent's
Security Interests in the Collateral shall cease to be perfected, or shall
cease to have the priority contemplated by the Security Documents, in each
case to the extent any such event would reasonably be expected to have a
Material Adverse Effect and otherwise than in accordance with the terms
thereof or with the express prior written agreement, consent or approval of
the Lenders, or any action at law, suit or in equity or other legal
proceeding to cancel, revoke or rescind any of the Credit Documents shall be
commenced by or on behalf of the Borrower or any of the Guarantors thereto or
any of their respective stockholders, or any court or any other governmental
or regulatory authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Credit Documents is illegal, invalid or
unenforceable in accordance with the terms thereof, unless such Credit
Document is duly replaced with a fully enforceable one within 7 days any such
event;
(n) a Change of Control; or
(o) any Impermissible Qualification of the audited financial
statements of the Borrower by its independent auditors;
then, (A) if the Event of Default that occurred is that mentioned in
paragraph (k) above, all Accommodations Outstanding, together with all
interest and Fees accrued thereon and all other amounts payable under this
Agreement in respect of the Credit Facilities, shall immediately become due
and payable, without demand, presentation, protest or other notice of any
nature, to which the Borrower expressly renounces; and (B) if the Event of
Default that occurred was any other Event of Default, the Administrative
Agent may, and shall at the request of the Majority Lenders, (i) terminate
the Lenders' obligations to make further Accommodations under the Credit
Facilities; and (ii) (at the same time or at any time after such termination)
declare the principal amount of all Accommodations Outstanding, together with
all interest and Fees accrued thereon and all other amounts payable under
this Agreement in respect of the Credit Facilities, to be immediately due and
payable, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by each Borrower. For greater
certainty, from and after the occurrence of a Default or Event of Default,
the Lenders shall not be obliged to provide any Accommodation hereunder.
Upon the acceleration of any amount hereunder and
notwithstanding anything herein to the contrary, the Borrower hereby
acknowledges that it shall be then indebted to, and
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shall be obligated to pay to the Administrative Agent, as a separate and
absolute obligation, all unpaid principal amount of and accrued interest on
Accommodations Outstanding, all Fees and all other amounts payable under this
Agreement. Such payment to the Administrative Agent when made shall be deemed
to have been made in discharge of the Borrower's obligations hereunder, and
the Administrative Agent shall distribute such proceeds among the Lenders as
provided herein.
SECTION 9.02. REMEDIES UPON DEMAND AND DEFAULT. (1) Upon a
declaration that the Accommodations Outstanding under the Credit Facilities
are immediately due and payable pursuant to Section 9.01, the Administrative
Agent shall at the request of, or may with the consent of, the Majority
Lenders, commence such legal action or proceedings as it, in its sole
discretion, may deem expedient, including the commencement of enforcement
proceedings under the Security Documents or any other security granted by the
Borrower, any Guarantor or others to the Administrative Agent or the Lenders,
or both, all without any additional notice, presentation, demand, protest,
notice of dishonour, entering into of possession of any of the Assets, or any
other action or notice, all of which the Borrower hereby expressly waives.
(2) The rights and remedies of the Administrative Agent and
the Lenders hereunder and under the other Credit Documents are cumulative and
are in addition to and not in substitution for any other rights or remedies.
Nothing contained herein or in the Security Documents or any other security
hereafter held by the Administrative Agent and the Lenders, with respect to
the indebtedness or liability of the Borrower or the Guarantors to the
Administrative Agent and the Lenders, or any part thereof, nor any act or
omission of the Administrative Agent or the Lenders with respect to the
Security Documents, the Security or such other security, shall in any way
prejudice or affect the rights, remedies and powers of the Administrative
Agent and the Lenders hereunder or under the Security Documents or such
Security.
SECTION 9.03. BANKRUPTCY AND INSOLVENCY. If the Borrower
files a notice of intention to file a proposal, or files a proposal under the
Bankruptcy and Insolvency Act, or if the Borrower obtains the permission of
the court to file a Plan of Arrangement under the Companies' Creditors
Arrangements Act, and if a stay of proceedings is obtained or ordered under
the provisions of either of those statutes, without prejudice to the Lenders'
rights to contest such stay of proceedings, the Borrower covenants and agrees
to continue to pay interest on all amounts due to the Lenders in accordance
with the provisions hereof. In this regard, the Borrower acknowledges that
permitting the Borrower to continue to use the proceeds of the Accommodations
constitutes valuable consideration provided after the filing of any such
proceeding in the same way that permitting the Borrower to use leased
premises constitutes such valuable consideration.
SECTION 9.04. RELATIONS WITH THE BORROWER. The
Administrative Agent may grant delays, take security or renounce thereto,
accept compromises, grant acquittances and releases and otherwise negotiate
with the Borrower and any Guarantor as it deems advisable without in any way
diminishing the liability of the Borrower or any Guarantor nor prejudicing
the rights of the Lenders with respect to the Security.
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SECTION 9.05. APPLICATION OF PROCEEDS. Following the
occurrence of an Event of Default which has not been waived, subject to the
provisions hereof, the Administrative Agent may apply the proceeds of
realization of the property contemplated by the Security Documents and of any
credit or compensating balance in reduction of the part of the Accommodations
(principal, interest or accessories and/or the Negative Value of Hedging
Agreements entered into with a Lender) which the Administrative Agent judges
appropriate; provided that, to the extent practicable, the Administrative
Agent will follow the order contemplated by Section 2.09(2) hereof. If any
Lender is owed money by the Borrower as a result of Hedging Agreements, and,
in particular, as a result of the Negative Value of Hedging Agreements, the
claim of such Lender, as well as the claim of the Person providing the
Overdraft Facility for all amounts owed thereunder,shall rank PARI PASSU with
the other amounts comprising the Accommodations.
ARTICLE 10
THE ADMINISTRATIVE AGENT AND THE LENDERS
SECTION 10.01. AUTHORIZATION AND ACTION. (1) Each
Lender irrevocably appoints and authorizes the Administrative Agent to
take such action as agent on its behalf and to exercise such powers under
this Agreement as are delegated to it by the terms of this Agreement,
together with the powers reasonably incidental thereto, but the
Administrative Agent shall not have any duties or responsibilities, except
those expressly set forth herein, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Credit Document or otherwise exist against the
Administrative Agent. As to any matters not expressly provided for by this
Agreement, the Administrative Agent shall act or refrain from acting (and
shall be fully protected in so doing) upon the joint instructions of the
Majority Lenders which instructions shall be binding upon all Lenders but, in
the absence of any such instructions, the Administrative Agent may (but shall
not be obliged to) act as it shall deem fit in the best interests of the
Lenders, and any such instructions and any action taken by the Administrative
Agent in accordance herewith shall be binding upon each Lender. The
Administrative Agent shall not, by reason of this Agreement, be deemed to be
a trustee or fiduciary for the benefit of any Lender, the Borrower or any
other Person. The Administrative Agent shall not be required to take any
action which (i) exposes it to personal liability; (ii) is contrary to this
Agreement or any applicable Law; (iii) would require it to become registered
to do business in any jurisdiction; or (iv) would subject it to taxation or
additional taxation in any jurisdiction.
(2) The Administrative Agent has no duties or obligations
other than as set out in this Agreement and there shall not be construed
against the Administrative Agent any implied duties (including fiduciary
duties), obligations or covenants. The Administrative Agent may execute or
perform, and may delegate the execution and performance of, any of its
powers, rights, discretions and duties under the Credit Documents through or
to any Persons designated by it. References in any Credit Document to an
Agent shall include references to any such Persons.
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(3) The Administrative Agent shall not be obliged to (i)
take or refrain from taking any action or exercise or refrain from exercising
any right or discretion under the Credit Documents; or (ii) incur or subject
itself to any cost in connection with the Credit Documents, unless it is
first specifically indemnified or furnished with security by the Lenders, in
form and substance satisfactory to it (which may include further agreements
of indemnity or the deposit of funds).
(4) The Issuing Lender shall act on behalf of the Lenders
with respect to any Letters of Credit issued by it and the documents
associated therewith, and the Issuing Lender shall have all of the benefits
and immunities (i) provided to the Administrative Agent in this Article 10
with respect to any acts taken or omissions suffered by the Issuing Lender in
connection with Letters of Credit issued by it or proposed to be issued by it
and the applications and agreements for letters of credit pertaining to such
Letters of Credit as fully as if the term "Administrative Agent" as used in
this Article 10 and in the definition of "Agent-Related Person" included the
Issuing Lender with respect to such acts or omissions, and (ii) as
additionally provided herein with respect to the Issuing Lender.
(5) For the purposes of creating a SOLIDARITE ACTIVE
between each Lender taken individually, and the Administrative Agent in
accordance with Article 1541 of the Civil Code, the Borrower, each Guarantor
and each Lender (on its own behalf) acknowledge and agree with the
Administrative Agent that such Lender and the Administrative Agent are hereby
conferred the legal status of solidary creditors of the Borrower and each
Guarantor in respect of all amounts, liabilities and other obligations owed
by the Borrower and each Guarantor to each of them hereunder and under the
other Credit Documents (collectively, the "SOLIDARY CLAIM") and that,
accordingly, but subject (for the avoidance of doubt) to Article 1542 of the
Civil Code, the Borrower and each Guarantor is irrevocably bound towards each
of the Administrative Agent, as solidary creditor for itself and the said
Lender in respect of the entire Solidary Claim. As a result of the foregoing,
the parties hereto acknowledge that the Administrative Agent and each Lender,
shall at all times have a valid and effective right of action for the entire
Solidary Claim and that the Liens of the Security Documents shall accordingly
be granted to the Administrative Agent, for its own behalf and for the
benefit of the Lenders.
SECTION 10.02. NO LIABILITY. (1) Neither the Administrative
Agent nor any Agent-Related Person shall be liable to any Lender for any
action taken or omitted to be taken by it or them in connection with the
Credit Documents except for its or their own gross negligence or wilful
misconduct in connection with its duties expressly set forth herein. Without
limiting the generality of the foregoing, the Administrative Agent and each
Agent-Related Person (i) may treat any Lender as the payee of amounts
attributable to its Commitment unless and until the Administrative Agent
receives an agreement in the form contemplated in Section 12.08(5); (ii) may
consult with legal counsel (including legal counsel for the Borrower),
independent accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken by it in accordance with
their advice; (iii) makes no warranty or representation to any Lender and
shall not be responsible to any Lender for the form, substance, accuracy or
completeness of any Credit Document or any other documents or information
made available to the Lenders; (iv) has no duty to inspect the property or
assets (including books and records) of the Borrower or any other Person;
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(v) has no duty to ascertain or inquire as to the existence of a Default or
an Event of Default or the observance of any of the terms or conditions of
the Credit Documents, and shall not be deemed to have any knowledge of same
until it has received notice from a Lender or the Borrower describing such
Default or Event of Default and stating that such notice is a "Default
Notice"; (vi) is not responsible (a) to any Lender for the execution,
enforceability, genuineness, sufficiency or value of any of the Credit
Documents or (b) to the Borrower or any Guarantor on account of the failure
of any Lender to perform its obligations; (vii) shall be entitled to rely
upon any certificate, notice or other document (including any cable,
telegram, telex or fax), electronic mail, telephone message or conversation
believed by it to be genuine and correct and to have been signed or sent by
or on behalf of the proper person or persons; and (viii) shall incur no
liability by acting upon any notice, certificate or other instrument believed
by it to be genuine and signed or sent by the proper Person.
(2) The Administrative Agent shall not be required to keep
itself informed as to the performance or observance by the Borrower of this
Agreement or any other document referred to or provided for herein or therein
or to inspect the properties or books of the Borrower. Except (in the case of
the Administrative Agent) for notices, reports and other documents and
information expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall have no duty
or responsibility to provide any Lender with any credit or other information
concerning the affairs or financial condition of the Borrower which may come
to the attention of the Administrative Agent, except where provided to the
Administrative Agent for the Lenders, provided that such information does not
confer any advantage to the Administrative Agent as a Lender over the other
Lenders. Nothing in this Agreement shall oblige the Administrative Agent to
disclose any information relating to the Borrower if such disclosure would or
might, in the opinion of the Administrative Agent, constitute a breach of any
Laws or duty of secrecy or confidence.
(3) For purposes of determining compliance with the
conditions specified in SECTION 6.01, each Lender that has signed this
Agreement shall be deemed to have consented to, approved or accepted or to be
satisfied with, each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to a Lender unless
the Administrative Agent shall have received notice from such Lender prior to
the proposed Closing Date specifying its objection thereto.
SECTION 10.03. ACCOMMODATIONS BY ADMINISTRATIVE AGENT. The
Administrative Agent has the same rights and powers under this Agreement with
respect to its Commitment as any other Lender and may exercise such rights
and powers as though it were not the Administrative Agent. The term "LENDER"
or "LENDERS" shall, unless otherwise expressly indicated, include the
Administrative Agent in its individual capacity. The Administrative Agent and
its Affiliates may accept deposits from, lend money to, act as trustee under
indentures of, underwrite an issue of securities of and generally engage in
any kind of business with, the Borrower, any of its subsidiaries, Holdco or
any Person who may do business with or own securities of such Persons, all as
if it were not the Administrative Agent and without any duty to account to
the Lenders.
SECTION 10.04. HOLDING OF SECURITY; SHARING OF PAYMENTS,
ETC. (1) The Security shall be held by the Administrative Agent for the
rateable benefit of the Lenders in accordance with
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their respective terms, and any proceeds from any realization of the
Security, as well as all other amounts received by the Administrative Agent
for the account of the Lenders, shall be applied to the Accommodations
Outstanding and other amounts payable to the Lenders under the Credit
Documents to each Lender rateably (whether such Security is held in the name
of the Administrative Agent or in the name of any one or more of the Lenders
and without regard to any priority to which any Lender may otherwise be
entitled under applicable Law), and in connection with any application of
proceeds of realization of Security as aforesaid, to the lender providing the
Overdraft Facility as well.
(2) Each Lender agrees with the other Lenders that it will
not, without the prior consent of the other Lenders, take or obtain any Lien
on any properties or assets of the Borrower or any of its subsidiaries to
secure the obligations of the Borrower under this Agreement, except for the
benefit of all Lenders or as may otherwise be required by applicable Law.
(3) If any Lender obtains any payment (whether voluntary,
involuntary or through the exercise of any right of set-off or realization of
Security) on account of Accommodations made by it (other than amounts paid
pursuant to Section 12.06) in excess of its rateable share of payments
obtained by all the Lenders, the Lender shall account to and pay over to the
other Lenders their rateable share and shall, upon request, immediately
purchase from the other Lenders such participations in the Accommodations
made by the other Lenders as shall be necessary to cause the purchasing
Lender to share the excess payment rateably with the other Lenders. If all or
any portion of the excess payment is recovered from the purchasing Lender,
the purchase price shall be rescinded and each Lender shall repay to the
purchasing Lender the purchase price to the extent of the recovery together
with an amount equal to the Lender's rateable share (according to the
proportion that the amount the Lender's required repayment bears to the total
amount recovered from the purchasing Lender) of any interest or other amount
paid by the purchasing Lender in respect of the total amount recovered. The
Lender purchasing a participation from another Lender pursuant to this
Section 10.04 may, to the fullest extent permitted by law, exercise all its
rights of payment (including any right of set-off) with respect to such
participation as fully as if the Lender were a direct creditor of the
Borrower in the amount of the participation and the Borrower expressly
acknowledges the creation of such right.
(4) On request by, and at the expense of, the Borrower and
provided no Default has occurred and is continuing and no Event of Default
has occurred and not been waived, the Administrative Agent may, on behalf of
the Lenders,
(a) discharge and release the Security to the extent required
(i) to permit a Disposition permitted under this Agreement;
(ii) upon termination of all Commitments and the payment in
full of all Accommodations Outstanding and all other amounts
owed to the Administrative Agents, the Lenders hereunder
(including for greater certainty the providers of the Hedging
Agreements) and the provider of the Overdraft Facility; or
(iii) if approved, authorized or ratified by all of the
Lenders (including for greater certainty the providers of
the Hedging Agreements) and the provider of the Overdraft
Facility;
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(b) to subordinate any Security held by the Administrative
Agent on property of the Loan Parties to the holder of a
Purchase Money Mortgage where same is permitted hereunder;
and
(c) to release any Guarantor from its guarantee provided in
connection with this Credit Agreement where such Guarantor
ceases to be a Guarantor as permitted hereunder.
SECTION 10.05. LENDER CREDIT DECISIONS. Each Lender
acknowledges that it has, independently and without reliance upon any
Agent-Related Person, made its own credit analysis and decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and
without reliance upon any Agent and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement.
SECTION 10.06 DELEGATION. The Administrative Agent may
execute any of its duties under this Agreement or any other Credit Document
by or through agents, employees or attorneys-in-fact and shall be entitled to
advice of counsel and other consultants or experts concerning all matters
pertaining to such duties. The Administrative Agent shall not be responsible
for the negligence or misconduct of any agent or attorney-in-fact that it
selects in the absence of gross negligence or willful misconduct.
SECTION 10.07. INDEMNIFICATION. Each Lender shall indemnify
and save the Administrative Agent and each Agent-Related Person harmless (to
the extent not reimbursed by the Borrower or another Loan Party) rateably
from any claim or loss suffered by, imposed upon or asserted against the
Administrative Agent as a result of, or arising out of, the Credit Documents
or any action taken or omitted by the Administrative Agent under the Credit
Documents provided that no Lender shall be liable for any part of such loss
resulting from the gross negligence or wilful misconduct of the
Administrative Agent in its capacity as agent. Without limiting the
foregoing, each Lender shall reimburse the Administrative Agent upon demand
for its rateable share of any out-of-pocket expenses incurred by the
Administrative Agent in connection with the preparation, execution,
administration or enforcement of, or legal advice in respect of rights or
responsibilities under, the Credit Documents (to the extent not reimbursed by
the Borrower or another Loan Party).
SECTION 10.08. LIABILITY OF THE LENDERS INTER SE. Each of
the Lenders agrees with each of the other Lenders that, except as otherwise
expressly provided in this Agreement, none of the Lenders has or shall have
any duty or obligation, or shall in any way be liable to any of the other
Lenders in respect of the Credit Documents or any action taken or omitted to
be taken in connection with them.
SECTION 10.09. SUCCESSOR ADMINISTRATIVE AGENT. The
Administrative Agent may (i) resign from its position at any time by giving
written notice to the Lenders and the Borrower; or (ii) be removed at any
time for cause by the Majority Lenders, such resignation or removal to be
effective upon the appointment of a successor Administrative Agent. Upon
notice of any resignation or removal, the Majority Lenders have the right to
appoint a successor Administrative Agent (and, if the Issuing Lender is also
the Administrative Agent, the Majority Lenders shall also
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appoint a new Issuing Lender) who (at any time that no Event of Default has
occurred and not been waived) shall be acceptable to the Borrower, acting
reasonably. If no successor Administrative Agent (and Issuing Lender, if
applicable) is appointed or has accepted the appointment within thirty days
after the retiring Administrative Agent's notice of resignation or removal,
as the case may be, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent, which shall be a
Lender, but such resignation shall not be effective until a successor
Administrative Agent (and Issuing Lender, if applicable) has been appointed.
Upon the acceptance of any such appointment by a successor Administrative
Agent (and Issuing Lender, if applicable), the successor shall succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent (and Issuing Lender, if applicable) and the
retiring Administrative Agent (and Issuing Lender, if applicable) shall be
discharged from its duties and obligations under this Agreement. If no
successor Administrative Agent (and Issuing Lender, if applicable) has
accepted appointment as Administrative Agent (and Issuing Lender, if
applicable) by the date which is 30 days following a retiring Administrative
Agent's notice of resignation, the retiring Administrative Agent's
resignation shall nevertheless thereupon become effective and the Lenders
shall perform all of the duties of the Administrative Agent (and Issuing
Lender, if applicable) hereunder until such time, if any, as the Majority
Lenders appoint a successor agent as provided for above. After any retiring
Administrative Agent's (and Issuing Lender, if applicable) resignation or
removal, as the case may be, the provisions of this Article 10 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent (and Issuing Lender, if applicable).
SECTION 10.10. ADMINISTRATIVE AGENT MAY FILE PROOFS OF
CLAIM. In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Accommodations Outstanding
shall then be due and payable as herein expressed or by declaration or
otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise
(a) to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Accommodations Outstanding
and all other obligations that are owing and unpaid and to file such other
documents as may be necessary or advisable in order to have the claims of the
Lenders and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders and the
Administrative Agent and their respective agents and counsel and all other
amounts due the Lenders and the Administrative Agent hereunder or under the
Hedging Agreements; and
(b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized
by each Lender to make such payments to the Administrative Agent and, in the
event that the Administrative Agent shall consent to the making of such
payments directly to the Lenders, to pay to the Administrative Agent any
amount due for
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the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due
the Administrative Agent hereunder.
Nothing contained herein shall be deemed to authorize the Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender
any plan of reorganization, arrangement, adjustment or composition affecting
the obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any
such proceeding.
SECTION 10.11. REPLACEMENT OF SCHEDULE II REFERENCE
LENDERS. If a Schedule II Reference Lender assigns, subject to the provisions
of Section 12.08, all of its rights hereunder or otherwise ceases to be a
Lender, or if a Schedule II Reference Lender gives notice of its intention to
cease being a Schedule II Reference Lender, or if in the opinion of the
Administrative Agent, a Schedule II Reference Lender is no longer capable of
exercising its functions as a Schedule II Reference Lender, the
Administrative Agent shall, with the prior written consent of the Borrower if
prior to an Event of Default which has not been waived, appoint another
Lender designated as a Schedule II bank under the BANK ACT (Canada) (with the
letters' consent) to act as a Schedule II Reference Lender in replacement
thereof.
SECTION 10.12. IRREVOCABLE POWER OF ATTORNEY (FONDE DE
POUVOIR). Without limiting the powers of the Administrative Agent hereunder
or under the Credit Documents and to the extent applicable, each of the
Lenders hereby acknowledges that the Administrative Agent shall, for the
purposes of holding any Security granted under the Security Documents for use
in the Province of Quebec, to secure payment of the Debentures, be the holder
of an irrevocable power of attorney (FONDE DE POUVOIR) (within the meaning of
Article 2692 of the CIVIL CODE OF QUEBEC) for all present and future Lenders
and in particular for all present and future holders of the Debentures. Each
of the Lenders hereby constitutes, to the extent necessary, the
Administrative Agent (or, if desired, a designated collateral agent) as the
holder of such irrevocable power of attorney in order to hold security
granted under such hypothecs to secure the Debentures. Each Assignee shall be
deemed to have confirmed and ratified the constitution of the Administrative
Agent as the holder of such irrevocable power of attorney by execution of the
relevant Transfer Agreement. Notwithstanding the provisions of Section 32 of
the AN ACT RESPECTING THE SPECIAL POWERS OF LEGAL PERSONS (Quebec), the
Borrower, the Guarantors and the Lenders irrevocably agree that the
Administrative Agent may acquire and be the holder of a Debenture. By
executing a Debenture, the issuer of the Debenture shall be deemed to have
acknowledged that the Debenture constitutes a title of indebtedness, as such
term is used in Article 2692 of the CIVIL CODE OF QUEBEC.
ARTICLE 11
CURRENCY AND EXCHANGE
SECTION 11.1. RULES OF CONVERSION. If for the purpose of
obtaining judgment in any court or for any other purpose hereunder, it is
necessary to convert an amount due, advanced or to be advanced hereunder from
the currency in which it is due (the "FIRST CURRENCY") into
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another currency (the "SECOND CURRENCY") the rate of exchange used shall be
that at which, in accordance with normal banking procedures, the
Administrative Agent could purchase, in the Canadian money market or the
Canadian exchange market, as the case may be, the First Currency with the
Second Currency on the date on which the judgment is rendered, the sum is
payable or advanced or to be advanced, as the case may be. The Borrower
agrees that its obligations in respect of any First Currency due from it to
the Lenders in accordance with the provisions hereof shall, notwithstanding
any judgment rendered or payment made in the Second Currency, be discharged
by a payment made to the Administrative Agent on account thereof in the
Second Currency only to the extent that, on the Business Day following
receipt of such payment in the Second Currency, the Administrative Agent may,
in accordance with normal banking procedures, purchase on the Canadian money
market or the Canadian foreign exchange market, as the case may be, the First
Currency with the amount of the Second Currency so paid or which a judgment
rendered payable; and if the amount of the First Currency which may be so
purchased is less than the amount originally due in the First Currency, the
Borrower agrees as a separate and independent obligation and notwithstanding
any such payment or judgment to indemnify the Lenders against such deficiency.
SECTION 11.2. DETERMINATION OF AN EQUIVALENT CURRENCY. If,
in their discretion, the Lenders or the Administrative Agent chooses or,
pursuant to the terms of this Agreement, are obliged to choose the equivalent
in Canadian Dollars of any securities or amounts expressed in US Dollars or
the equivalent in US Dollars of any securities or amounts expressed in
Canadian Dollars, the Administrative Agent, in accordance with the conversion
rules as stipulated in Section 11.1, on the date indicated in the Borrowing
Notice as the date of a request for an Advance, and at any other time which
in the opinion of the Lenders is desirable; may, using the spot rate of the
Administrative Agent or an Affiliate on such date, determine the equivalent
in Canadian Dollars or in US Dollars, as the case may be, of any security or
amount expressed in the other currency pursuant to the terms hereof.
Immediately following such determination, the Administrative Agent shall
inform the Borrower of the conclusion which the Lenders have reached.
ARTICLE 12
MISCELLANEOUS
SECTION 12.01. AMENDMENT. (1) Subject to subsections (2)
and (3), no amendment or waiver of any provision of any of the Credit
Documents, nor consent to any departure by the Borrower or any other Person
from such provisions, is effective unless in writing and approved by the
Majority Lenders. Any amendment, waiver or consent is effective only in the
specific instance and for the specific purpose for which it was given.
(2) Only written amendments, waivers or consents signed by
all the Lenders shall (i) increase a Lender's Commitment or subject any
Lender to any additional obligation, or increase the aggregate Commitments
hereunder; (ii) reduce the principal amount of, or interest on, directly or
indirectly, any Accommodation Outstanding or any Fees; (iii) postpone any
date fixed for any payment of principal of, or interest on, any Accommodation
Outstanding or any Fees, or
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otherwise postpone or extend any maturity date, including in relation to a
Mandatory Prepayment; (iv) change (y) the percentage of the Commitments, or
(z) the number or percentage of Lenders required for the Lenders, or any of
them, or the Administrative Agent to take any action; (v) permit any
amendment to or termination of any of the Security Documents or release any
of the collateral subject thereto (except as otherwise permitted in Section
10.04(4)); (vi) permit the release of any Guarantor or the amendment of any
guarantee provided by any Guarantor (except as otherwise permitted by Section
10.4(4)); (vii) change the definition of Majority Lenders; (viii) modify or
waive any condition precedent provided for in Article 6; (ix) modify the
application of payments contemplated by Section 2.09 or 9.05, or the rateable
application of same in accordance with the provisions of Section 10.04; or
(ix) amend this Section 12.01(2).
(3) Only written amendments, waivers or consents signed by
the Administrative Agent in addition to the Majority Lenders, shall affect
the rights or duties of the Administrative Agent under the Credit Documents.
SECTION 12.02. WAIVER. (1) No failure on the part of any
Lender or the Administrative Agent to exercise, and no delay in exercising,
any right under any of the Credit Documents shall operate as a waiver of such
right; nor shall any single or partial exercise of any right under any of the
Credit Documents preclude any other or further exercise of such right or the
exercise of any other right.
(2) Except as otherwise expressly provided in this
Agreement, the covenants, representations and warranties shall not merge on
and shall survive the initial Accommodation and, notwithstanding such initial
Accommodation or any investigation made by or on behalf of any party, shall
continue in full force and effect. The closing of this transaction shall not
prejudice any right of one party against any other party in respect of
anything done or omitted under this Agreement or in respect of any right to
damages or other remedies.
SECTION 12.03. EVIDENCE OF DEBT AND ACCOMMODATION NOTICES.
(1) The indebtedness of the Borrower resulting from Accommodations under the
Credit Facilities shall be evidenced by the records of the Lenders (or the
Administrative Agent acting on behalf of the Lenders) which shall constitute
PRIMA FACIE evidence of such indebtedness.
(2) Prior to the receipt of any Accommodation Notice, the
Administrative Agent may act upon the basis of a notice by telephone
(containing the same information as required to be contained in such
Accommodation Notice) believed by it in good faith to be from an authorized
person representing the Borrower. In the event of a conflict between the
Administrative Agent's record of any Accommodation and the Accommodation
Notice, the Administrative Agent's record shall prevail, absent manifest
error.
SECTION 12.04. NOTICES, ETC. Any notice, direction or other
communication required or permitted to be given under this Agreement shall,
except as otherwise permitted, be in writing and given by delivering it or
sending it by telecopy or other similar form of recorded communication
addressed, if to the Borrower, to it at:
Sun Media Corporation, 000 Xxxx
Xxxxxx Xxxx, Xxxxxxx (Xxxxxxx), X0X 0X0, Xxxxxx, Attention: Controller,
Telephone: (000) 000-0000,
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Fax: (000) 000-0000, with a copy to: Treasurer, Quebecor Media Inc.,
Telephone: (000) 000-0000, Fax: (000) 000-0000; if to the Administrative
Agent, (I) for the purposes of Accommodations and Repayments under (A)
Facility A, to it at: 000 Xxxxx Xxxxxx Xxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx,
X0X 0X0 , Attention: Xxxxxxx.Xxxxxxxx, Credit Services, Telephone: (416)
000-0000, Fax: (000) 000-0000/4283, E-mail:
Xxxxxxx.Xxxxxxxx@xxxxxxxxxxxxx.xxx; Alternate - Xxxxx XxXxxxxx, 000-000-0000,
E-mail: Xxxxx.XxXxxxxx@xxxxxxxxxxxxx.xxx; and (B) Term Facility B, to it at:
Bank of America, N. A., Agency Services, 0000 Xxxxxxx Xxxx., 0xx Xxxxx, XX:
CA4-706-05-09, Xxxxxxx, XX 00000, Phone: (000) 000-0000, Fax: (000) 000-0000,
E-mail: xxxxxxxx.x.xxxxxxxx@xxxxxxxxxxxxx.xxx; and (II), for all other
purposes, to it at: 000 Xxxxx Xxxxxx Xx., 00xx floor, CA9-706-17-54 in the
City of Xxx Xxxxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxx Xxxxx,
Vice-President, Telephone: (000) 000-0000, Fax: (000) 000-0000, Email:
xxxxx.xxxxx@xxxxxxxxxxxxx.xxx; and, if to the Lenders, at the addresses shown
on the signature pages. Any communication shall be deemed to have been
validly and effectively given (i) if personally delivered, on the date of
such delivery if such date is a Business Day and such delivery was made prior
to 4:00 p.m. (Toronto time); (ii) if transmitted by facsimile or similar
means of recorded communication on the Business Day following the date of
transmission. Any party may change its address for service from time to time
by notice given in accordance with the foregoing and any subsequent notice
shall be sent to the party at its changed address.
SECTION 12.05. CONFIDENTIALITY. Each Lender agrees to use
reasonable efforts to ensure that financial statements or other information
relating to the Borrower which may be delivered to it pursuant to this
Agreement and which are not publicly filed or otherwise made available to the
public generally (and which are not independently known to the Lender) will,
to the extent permitted by Law, be treated confidentially by the Lender and
will not, except with the consent of the Borrower, be distributed or
otherwise made available by the Lender to any Person other than its
directors, officers, employees, authorized agents, counsel or other
representatives (provided the other representatives have agreed or are under
a duty to keep all information confidential) required, in the reasonable
opinion of the Lender, to have such information. Each Lender is authorized to
deliver a copy of any financial statement or any other information which may
be delivered to it pursuant to this Agreement, to (i) any actual or potential
Participant or Assignee; (ii) any Governmental Entity having jurisdiction
over the Lender in order to comply with any applicable laws; (iii) any
Affiliate of the Lender required, in the reasonable opinion of the Lender, to
have such information; and (iv) any direct or indirect contractual
counterparty in any swap, hedge or similar agreement (or to any such
contractual counterparty's professional advisor), so long as such contractual
counterparty (or such professional advisor) agrees to be bound by the
provisions of this Section 12.05.
SECTION 12.06. COSTS, EXPENSES AND INDEMNITY. (1) The
Borrower shall, whether or not the transactions contemplated in this
Agreement are completed, indemnify and hold each of the Lenders and each
Agent-Related Person and each of their respective officers, directors,
employees, agents, trustees and advisors (each an "INDEMNIFIED PERSON")
harmless from, and shall pay to such Indemnified Person on demand any amounts
required to compensate the Indemnified Person for, any claim or loss suffered
by, imposed on, or asserted against, the Indemnified Person as a result of,
connected with or arising out of (i) the preparation, execution and delivery
of the Commitment Letter, Term Sheet and Fee Letter, (ii) the preparation,
execution and delivery of,
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preservation of rights under, enforcement of, or
refinancing, renegotiation or restructuring of, the Credit Documents and any
related amendment, waiver or consent; (iii) any advice of counsel as to the
rights and duties of the Administrative Agent and the Lenders with respect to
the administration of the Credit Facilities, the Credit Documents or any
transaction contemplated under the Credit Documents, including any
interpretation issues; (iv) a default (whether or not constituting a Default
or an Event of Default) by the Borrower; (v) any proceedings brought against
the Indemnified Person due to its entering into any of the Credit Documents
and performing its obligations under the Credit Documents except to the
extent that it shall be determined in a final, non-appealable judgment by a
court of competent jurisdiction that such losses, claims, damages,
liabilities or expenses resulted primarily from the gross negligence or
wilful misconduct of the Indemnified Person; and (vi) the presence on or
under or the discharge or likely discharge of Hazardous Substances from any
of the properties used by the Borrower or any of its subsidiaries, or the
breach of any Environmental Law by the Borrower or any of its subsidiaries or
by any mortgagor, owner, or lessee of such properties. No Indemnified Person
shall be liable for any damages arising from the use by others of information
provided by or on behalf of the Borrower and obtained through the Internet,
Intralinks or other similar information transmission systems in connection
with the Credit Facilities except to the extent that, as to any Indemnified
Person, it shall be determined by a final, non-appealable judgment by a court
of competent jurisdiction that such damages resulted primarily from gross
negligence or willful misconduct of such Indemnified Person. The Borrower
agrees that no Indemnified Person shall have any liability (whether direct or
indirect, in contract or tort or otherwise) to any Person, including the
Borrower, any of its subsidiaries and Affiliates or their respective security
holders or creditors arising out of or in connection with any aspect of this
Credit Agreement or the Credit Facilities, except for direct, as opposed to
consequential, damages determined in a final, non-appealable judgment by a
court of competent jurisdiction to have resulted primarily from the gross
negligence or willful misconduct of such Indemnified Person.
(2) If, with respect to any Lender, (i) any change in Law
of general application, or any change in the interpretation or application of
such Law occurring or becoming effective after the Closing Date; or (ii)
compliance by the Lender with any direction, request or requirement (whether
or not having the force of law) of any Governmental Entity made or becoming
effective after the Closing Date, has the effect of causing any loss to the
Lender or reducing the Lender's rate of return by (w) increasing the cost to
the Lender of performing its obligations under this Agreement or in respect
of any Accommodations Outstanding (including the costs of maintaining any
capital, reserve or special deposit requirements (other than a reduction
resulting from a higher rate or from a change in the calculation of income or
capital tax relating to the Lender's income or capital in general)), (x)
requiring the Lender to maintain or allocate any capital or additional
capital or affecting its allocation of capital in respect of its obligations
under this Agreement or in respect of any Accommodations Outstanding, (y)
reducing any amount payable to the Lender under this Agreement or in respect
of any Accommodations Outstanding by any material amount, (z) causing the
Lender to make any payment or to forego any return on, or calculated by
reference to, any amount received or receivable by the Lender under this
Agreement or in respect of any Accommodations Outstanding, then, subject to
Section 12.06(3), the Lender may give notice to the Borrower specifying, with
reasonable detail, the nature of the event giving rise to the loss and the
Borrower may either: (A) on demand, pay such amounts as the Lender specifies
is necessary to compensate it for any such loss, or (B) provided no loss has
yet been suffered by the Lender or the
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Borrower has paid the compensating amount to the Lender, repay the
Accommodations Outstanding to such Lender and terminate the Lender's
Commitments all without affecting the Commitments or Accommodations
Outstanding of any other Lender. A certificate as to the amount of any such
loss submitted in good faith by a Lender to the Borrower shall be conclusive
and binding for all purposes, absent manifest error.
(3) The Borrower shall not be liable to compensate a Lender
for any costs, reduction, payment or foregone return if such compensation is
not being claimed as a general practice by such Lender from customers of such
Lender who by agreement are liable to pay such or similar compensation. In
determining the amount of compensation payable by the Borrower under Section
12.06(2), such Lender shall use all reasonable efforts to minimize the
compensation payable by the Borrower including using all reasonable efforts
to obtain refunds or credits in the ordinary course of its business, and any
compensation paid by the Borrower which is later determined not to have been
properly payable or in respect of which a refund, credit or compensation has
been received shall forthwith be reimbursed by such Lender to the Borrower.
(4) The Borrower shall pay to each Lender on demand any
amounts required to compensate the Lender for any loss suffered or incurred
by it as a result of (i) any payment being made in respect of a BA Instrument
or Libor Advance other than on the maturity applicable to it; (ii) the
failure of the Borrower to give any notice in the manner and at the times
required by this Agreement; (iii) the failure of the Borrower to effect an
Accommodation in the manner and at the time specified in any Accommodation
Notice; or (iv) the failure of the Borrower to make a payment or a mandatory
repayment in the manner and at the time specified in this Agreement. A
certificate as to the amount of any loss submitted in good faith by a Lender
to the Borrower shall be conclusive and binding for all purposes, absent
manifest error.
(5) The provisions of this Section 12.06 shall survive the
termination of this Agreement and the repayment of all Accommodations
Outstanding. The Borrower acknowledges that neither their obligation to
indemnify nor any actual indemnification by them of any Lender, the
Administrative Agent or any other Indemnified Person in respect of such
Person's losses for the legal fees and expenses shall in any way affect the
confidentiality or privilege relating to any information communicated by such
Person to its counsel.
SECTION 12.07. TAXES. (1) The Borrower agrees to
immediately pay any present or future stamp or documentary taxes or any other
excise or property taxes, charges, financial institutions duties, debits or
similar levies (all such taxes, charges, duties and levies being referred to
as "TAXES") which arise from any payment made by the Borrower under any of
the Credit Documents or from the execution, delivery or registration of, or
otherwise with respect to, any of the Credit Documents. If any Taxes are
required to be withheld from any payment hereunder, the Borrower shall (a)
increase the amount of such payment so that the Lenders will receive a net
amount (after deduction and withholding of all Taxes) equal to the amount
otherwise due hereunder; (b) pay such Taxes to the appropriate taxing
authority for the account of the relevant Lenders and (c) as promptly as
possible thereafter, send the Administrative Agent and the Lenders an
original receipt showing payment thereof, together with such additional
documentary evidence as the Lenders may from time to time reasonably require.
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(2) The Borrower shall indemnify the Lenders and the
Administrative Agent for the full amount of Taxes (including, without
limitation, any Taxes imposed by any jurisdiction on amounts payable by the
Borrower under this Section 12.07) paid by the Lenders or the Administrative
Agent and any liability (including penalties, interest and expenses) arising
from or with respect to such Taxes, whether or not they were correctly or
legally asserted, excluding, in the case of any Lender, taxes imposed on its
net income or capital taxes or receipts and franchise taxes. Payment under
this indemnification shall be made within 30 days from the date the
Administrative Agent or the relevant Lender, as the case may be, make written
demand for it. A certificate as to the amount of such Taxes submitted to the
Borrower by the Administrative Agent or the relevant Lender shall be
conclusive evidence, absent manifest error, of the amount due from the
Borrower to the Administrative Agent or the Lenders, as the case may be.
(3) The Borrower shall furnish to the Administrative Agent
and the Lenders the original or a certified copy of a receipt evidencing
payment of Taxes made by the Borrower within 30 days after the date of any
payment of Taxes.
(4) The provisions of this Section 12.07 shall survive
the termination of the Agreement and the repayment of all Accommodations
Outstanding.
SECTION 12.08. SUCCESSORS AND ASSIGNS. (1) This Agreement
shall become effective when executed by the Borrower, the Administrative
Agent and each Lender and after that time shall be binding upon and enure to
the benefit of the Borrower, the Lenders and the Administrative Agent and
their respective successors and permitted assigns.
(2) The Borrower shall not have the right to assign its
rights or obligations under this Agreement or any interest in this Agreement
without the prior consent of all the Lenders, which consent may be
arbitrarily withheld.
(3) A Lender may (i) grant participations, without notice
to or consent of the Borrower or the Administrative Agent, in all or any part
of its interest in the Credit Facilities to one or more Persons (each a
"PARTICIPANT"), or (ii) upon prior written notice to the Administrative Agent
and the Borrower, assign all or any part of its interest in the Credit
Facilities to one or more Persons (each an "ASSIGNEE"), provided that in the
case of any interest which is a partial interest (other than after the
occurrence of a Default which is continuing or an Event of Default which has
not been waived, in which case no minimums will apply), such partial interest
is not less than $5,000,000 under Facility A or US$1,000,000 under Term
Facility B (or such lesser amount as agreed to by the Borrower and the
Administrative Agent). An assignment shall require (A) the consent of the
Borrower, which shall not be unreasonably withheld or delayed, prior to the
occurrence of a Default which is continuing or an Event of Default which has
not been waived, and thereafter shall not require any such consent, and (B)
the consent of the Administrative Agent (and, in the case of assignments
under Facility A, the Issuing Lender and the Swingline Lender), which shall
not be unreasonably withheld or delayed; provided that the Borrower's consent
shall not be required for an assignment to any of the following Persons: (A)
a Lender; (b) an Affiliate of a Lender; or (c) an Approved Fund, which shall
not be the Borrower or any of the Borrower's
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Affiliates or subsidiaries. A Lender granting a participation shall, unless
otherwise expressly provided in this Agreement, act on behalf of all of its
Participants in all dealings with the Borrower in respect of the Credit
Facilities and no Participant shall have any voting or consent rights with
respect to any matter requiring the Lenders' consent. In the case of an
assignment, the Assignee shall have the same rights and benefits and be
subject to the same limitations under the Credit Documents as it would have
if it was a Lender, provided that no Assignee or Participant shall be
entitled to receive any greater payment, on a cumulative basis, pursuant to
Section 12.06 or Section 12.07 than the Lender which granted the assignment
or participation would have been entitled to receive.
(4) The Borrower shall provide such certificates,
acknowledgments and further assurances in respect of this Agreement and the
Credit Facilities as such Lender may reasonably require in connection with
any participation or assignment pursuant to this Section 12.08.
(5) In order to effect an assignment in accordance with
this Section 12.08, a Lender shall deliver to the Borrower an assignment and
assumption agreement substantially in the form of Schedule 6 by which an
Assignee of the Lender assumes the obligations and agrees to be bound by all
the terms and conditions of this Agreement, all as if the Assignee had been
an original party. Upon receipt by the Administrative Agent from the
assigning Lender of a processing fee of US$3,500 and the assignment and
assumption agreement, the assigning Lender and the Borrower shall be released
from their respective obligations under this Agreement (to the extent of such
assignment and assumption) and shall have no liability or obligations to each
other to such extent, except in respect of matters arising prior to the
assignment.
(6) Any assignment or grant of participation pursuant to
this Section 12.08 will not constitute a repayment by the Borrower to the
assigning or granting Lender of any Accommodation, nor a new Accommodation to
the Borrower by such Lender or by the Assignee or Participant, as the case
may be, and the parties acknowledge that the Borrower's obligations with
respect to any such Accommodations will continue and will not constitute new
obligations.
(7) The amounts payable by the Borrower under this
Agreement shall not increase on account of withholding taxes as a result of
any such assignment or transfer to an Assignee of a Facility A Lender which
is a non-resident of Canada as defined in the INCOME TAX ACT (Canada);
provided that an assignment which occurs after the occurrence of an Event of
Default which has not been waived shall not be subject to this provision.
(8) Any Lender (a "GRANTING LENDER") may grant to a special
purpose funding vehicle (an "SPV"), identified as such from time to time by
the Granting Lender to the Agent and the Borrower, the option to provide to
the Borrower all or any part of an Advance that such Granting Lender would
otherwise be required to make hereunder; provided that (a) nothing herein
shall constitute a commitment by any SPV to make any Advance, and (b) if an
SPV does not make such Advance, the Granting Lender shall remain liable to do
so. Any Advance by an SPV shall be made using the Commitment of the Granting
Lender as if the Advance in question had been made by such Granting Lender.
Each party hereto agrees that no SPV shall be liable for any indemnity or
other payment hereunder, all of which liability shall remain with the
Granting Lender. Accordingly,
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each party further agrees (which agreement will survive the termination
hereof) that it shall not institute any insolvency or other proceeding
against the SPV until a date that is not less than one year and one day
following the repayment of all of such SPV's commercial paper and other
senior Indebtedness. In addition, any SPV may (a) assign all or any portion
of its interests in any Loans (i) with notice to, but without the consent of
the Borrower or the Agent, and without paying any fees therefor, to the
Granting Lender or (ii) to any financial institutions, with the consent of
the Borrower and the Agent providing liquidity and/or credit support to or
for the account of such SPV to support the funding and maintenance of
Advances; and (b) disclose on a confidential basis any non-public information
relating to the Loans to any rating agency, commercial paper dealer or
provider of any surety, guarantee or credit or liquidity enhancement to such
SPV.
(9) The Administrative Agent shall maintain at
one of its offices a copy of each Assignment Agreement delivered to it and a
register for the recordation of the names and addresses of the Lenders, and
the Commitments of, each Lender pursuant to the terms hereof from time to
time (the "REGISTER"). The entries in the Register shall be conclusive, and
the Borrower, the Administrative Agent, the Issuing Lender and the Lenders
may treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower, the Issuing Lender and any Lender, at any
reasonable time and from time to time upon reasonable prior notice. No
assignment shall be effective unless recorded in the Register.
SECTION 12.09. FACILITY A LENDER BECOMING NON-RESIDENT. If
a Facility A Lender becomes a non-resident of Canada as defined in the INCOME
TAX ACT (Canada), it shall promptly notify the Administrative Agent and the
Borrower, and if the Borrower unknowingly made payments to such Facility A
Lender that should have been subject to withholding taxes prior to such
notice, such Facility A Lender shall repay the amount that should have been
so withheld to the Borrower to be paid to the appropriate taxation authority.
Following such notice, the Facility A Lender in question shall have one of
the following options in connection with its Facility A Commitment: (a) to
permit the Borrower to deduct and pay the applicable withholding tax to the
appropriate taxation authority for so long as it is such a non-resident; or
(b) to require that the Borrower replace it as a Facility A Lender within 15
Business Days from such notice, failing which its Facility A Commitment will
be cancelled, and the Facility A Commitment hereunder will be permanently
reduced by an equal amount.
SECTION 12.10. RIGHT OF SET-OFF. Upon the occurrence of any
Event of Default, each Lender is authorized at any time and from time to
time, to the fullest extent permitted by law (including general principles of
common law), to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness
at any time owing by it to or for the credit or the account of the Loan
Parties against any and all of the obligations of the Borrower under any of
the Credit Documents, irrespective of whether or not the Lender has made
demand under any of the Credit Documents and although such obligations may be
unmatured or contingent. If an obligation is unascertained, the Lender may,
in good faith, estimate the obligation and exercise its right of set-off in
respect of the estimate, subject to providing the Borrower with an accounting
when the obligation is finally determined. Each Lender shall
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promptly notify the Borrower after any set-off and application is made by it,
provided that the failure to give notice shall not affect the validity of the
set-off and application. The rights of the Lenders under this Section 12.10
are in addition to other rights and remedies (including all other rights of
set-off) which the Lenders may have.
SECTION 12.11. ACCOMMODATIONS BY LENDERS. The failure of
any Lender to make an Accommodation shall not relieve any other Lender of its
obligations in connection with such Accommodation, but no Lender is
responsible for any other Lender's failure in respect of an Accommodation.
Unless the Administrative Agent receives notice from a Lender prior to the
date of any Accommodation that the Lender will not make its rateable portion
of the Accommodation available to the Administrative Agent, the
Administrative Agent may assume that the Lender has made its portion so
available on the date of the Accommodation and may, in reliance upon such
assumption, make a corresponding amount available to the Borrower. If the
Lender has not made its rateable portion available to the Administrative
Agent, the Lender shall pay the corresponding amount to the Administrative
Agent immediately upon demand. If the Lender pays the corresponding amount to
the Administrative Agent, the amount so paid shall constitute the Lender's
part of the Accommodation for purposes of this Agreement. If the Lender does
not pay the amount to the Administrative Agent immediately upon demand and
such amount has been made available to the Borrower, the Borrower shall pay
the corresponding amount to the Administrative Agent immediately upon demand
and any amount received and so reimbursed would not and will not constitute
an Accommodation. The Administrative Agent shall also be entitled to recover
from the Lender or the Borrower, as the case may be, interest on the
corresponding amount, for each day from the date the amount was made
available to the Borrower until the date it is repaid to the Administrative
Agent, at a rate per annum equal to the Administrative Agent's cost of funds.
SECTION 12.12. RATEABLE PAYMENTS. Unless the Administrative
Agent receives notice from the Borrower prior to the date on which any
payment is due to the Lenders that the Borrower will not make the payment in
full, the Administrative Agent may assume that the Borrower has made the
payment in full on that date and may, in reliance upon that assumption,
distribute to each Lender on the due date an amount equal to the amount then
due to the Lender. If the Borrower has not made the payment in full, each
Lender shall repay to the Administrative Agent immediately upon demand the
amount distributed to it together with interest for each day from the date
such amount was distributed to the Lender until the date the Lender repays it
to the Administrative Agent, at a rate per annum equal to the Administrative
Agent's cost of funds.
SECTION 12.13. INTEREST ON ACCOUNTS. Except as may be
expressly provided otherwise in this Agreement, all amounts owed by the
Borrower to the Administrative Agent and to any of the Lenders, which are not
paid when due (whether at stated maturity, on demand, by acceleration or
otherwise) shall (to the extent permitted by Law) bear interest (both before
and after default and judgment), from the date on which such amount is due
until such amount is paid in full, payable on demand, at a rate per annum
equal at all times to the sum of the Canadian Prime Rate in effect from time
to time, the Applicable Margin and 2%.
SECTION 12.14. GOVERNING LAW. This Agreement shall be
governed by and interpreted and enforced in accordance with the laws of the
Province of Ontario and the laws of
85
Canada applicable therein; provided that the provisions of Section 10.12
shall be subject to the laws of the Province of Quebec and the laws of Canada
applicable therein.
SECTION 12.15. CONSENT TO JURISDICTION. The Borrower and
each Lender and each Agent hereby irrevocably submits to the jurisdiction of
any Ontario court sitting in Toronto, Ontario in any action or proceeding
arising out of or relating to the Credit Documents and hereby irrevocably
agrees that all claims in respect of any such action or proceeding may be
heard and determined in such Ontario court. The Borrower, each Lender and
each Agent hereby irrevocably waives, to the fullest extent each may
effectively do so, the defence of an inconvenient forum to the maintenance of
such action or proceeding. The Borrower, each Lender and each Agent agrees
that a final judgment in any such action or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any
other manner provided by Law.
SECTION 12.16. COUNTERPARTS. This Agreement may be
executed in any number of counterparts (including by way of facsimile) and
all of such counterparts taken together shall be deemed to constitute one and
the same instrument.
SECTION 12.17. SEVERABILITY. Any provision of this
Agreement which is or becomes prohibited or unenforceable in any
jurisdiction, does not invalidate, affect or impair the remaining provisions
thereof and any such prohibition or unenforceability in any jurisdiction does
not invalidate or render unenforceable such provision in any other
jurisdiction.
SECTION 12.18. ASSIGNMENT TO FEDERAL RESERVE BANK. (1)
Notwithstanding any provision of this Agreement to the contrary, any Lender
governed by the applicable Laws of the United States of America may at any
time assign all or a portion of its rights under this Agreement and all other
documents ancillary thereto (including the Security Documents) to a Federal
Reserve Bank. No such assignment shall relieve the assigning Lender from its
obligations under this Agreement or such other documents.
(2) Upon the request of any Lender, the Borrower will
execute and deliver one or more promissory notes substantially in the form of
Schedule 9, evidencing the Term Facility B Commitment and Accommodations
Outstanding under Term Facility B.
(3) In the case of any Lender that is a fund that invests
in bank loans, such Lender may, without the consent of the Borrower or
Administrative Agent, assign or pledge all or any portion of its rights under
this Agreement, including the Accommodations and any instrument evidencing
its rights as a Lender under this Agreement, to any holder or, trustee for,
or any other representative of holders of, obligations owed or securities
issued, by such fund, as security for such obligations or securities, without
cost to the Borrower; provided that any foreclosure or similar action by such
trustee or representative shall be subject to the provisions of this Section
concerning assignments. Any such Lender shall, unless otherwise expressly
provided in this Agreement, act on behalf of all of its pledgees in all
dealings with the Borrower in respect of the Credit Facilities and no such
pledgee shall have (i) any voting or consent rights with respect to any
matter requiring the Lenders' consent, (ii) any entitlement to any amounts
payable hereunder, or (iii) any other rights of any nature hereunder until it
has complied with the provisions of this Section concerning assignments.
86
SECTION 12.19. GOOD FAITH AND FAIR CONSIDERATION. The
Borrower acknowledges and declares that it has entered into this Agreement
freely and of its own will. In particular, the Borrower acknowledges that
this Agreement was negotiated by it and the Lenders in good faith, and that
there was no exploitation of the Borrower by the Lenders, nor is there any
serious disproportion between the consideration provided by the Lenders and
that provided by the Borrower. Furthermore, the parties to this Agreement
agree to act in good faith and in a reasonable manner with each other during
the Term hereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective authorized officers as of the date first above
written.
SUN MEDIA CORPORATION
Per: /s/ Xxxx X'Xxxxx
---------------------------
Authorized Signing Officer
(signatures continued on the next following page)
BANK OF AMERICA, N.A.
AS ADMINISTRATIVE AGENT
Per: /s/ [Illegible]
---------------------------
Authorized Signing Officer
Term Facility B:
Address: 000 Xxxxx Xxxxxx Xx., 17th floor,
CA9-706-17-54
Xxx Xxxxxxx, Xxxxxxxxxx, 00000
Attention: Vice-President, Agency
Telephone: (000) 000-0000
Fax: (000) 000-0000
Email: xxxxx.xxxxx@xxxxxxxxxxxxx.xxx
Address for payments: Xxxxxxxx Xxxxxxxx
Bank of America N.A.
0000 Xxxxxxx Xxxx., 0xx Xxxxx
XX: CA4-706-05-09
Xxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxxxx.x.xxxxxxxx@xxxxxxxxxxxxx.xxx
Facility A: 000 Xxxxx Xxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx, X0X 0X0
Attention: Xxxxxxx.Braganza, Credit Services
Telephone: (000) 000-0000
Fax: (000) 000-0000-0000
E-mail: Xxxxxxx.Xxxxxxxx@xxxxxxxxxxxxx.xxx
Alternate - Xxxxx XxXxxxxx, 000-000-0000
E-mail: Xxxxx.XxXxxxxx@xxxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
BANK OF AMERICA, N.A.
AS ADMINISTRATIVE AGENT
Per: /s/ Xxxxx Xxxxx
---------------------------
Authorized Signing Officer
Address: 000 Xxxxx Xxxxxx Xx., 00xx floor,
CA9-706-17-54
Xxx Xxxxxxx, Xxxxxxxxxx, 00000
Attention: Xxxxx Xxxxx, Vice-President
Telephone: (000) 000-0000
Fax: (000) 000-0000
Email: xxxxx.xxxxx@xxxxxxxxxxxxx.xxx
Address for operations (Facility B): Xxxxxxxx Xxxxxxxx
Bank of America N.A.
0000 Xxxxxxx Xxxx., 0xx Xxxxx
XX: CA4-706-05-09
Xxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxxxx.x.xxxxxxxx@xxxxxxxxxxxxx.xxx
Address for operations (Facility A): Bank of America, N.A., Canada Branch
000 Xxxxx Xxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx, X0X 0X0
Attention: Xxxxxxx.Braganza, Credit Services
Telephone: (000) 000-0000
Fax: (000) 000-0000/4283
E-mail: Xxxxxxx.Xxxxxxxx@xxxxxxxxxxxxx.xxx
Alternate - Xxxxx XxXxxxxx, 000-000-0000
E-mail: Xxxxx.XxXxxxxx@xxxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceing page)
BANK OF AMERICA, N.A.
AS ADMINISTRATIVE AGENT
Per: /s/ Xxxxx Xxxxx
---------------------------
Authorized Signing Officer
Address: 000 Xxxxx Xxxxxx Xx., 00xx floor,
CA9-706-17-54
Xxx Xxxxxxx, Xxxxxxxxxx, 00000
Attention: Xxxxx Xxxxx, Vice-President
Telephone: (000) 000-0000
Fax: (000) 000-0000
Email: xxxxx.xxxxx@xxxxxxxxxxxxx.xxx
Address for operations (Facility B): Xxxxxxxx Xxxxxxxx
Bank of America N.A.
0000 Xxxxxxx Xxxx., 0xx Xxxxx
XX: CA4-706-05-09
Xxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxxxx.x.xxxxxxxx@xxxxxxxxxxxxx.xxx
Address for operations (Facility A): Bank of America, N.A., Canada Branch
000 Xxxxx Xxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx, X0X 0X0
Attention: Xxxxxxx.Braganza, Credit Services
Telephone: (000) 000-0000
Fax: (000) 000-0000/4283
E-mail: Xxxxxxx.Xxxxxxxx@xxxxxxxxxxxxx.xxx
Alternate - Xxxxx XxXxxxxx, 000-000-0000
E-mail: Xxxxx.XxXxxxxx@xxxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A BANK OF AMERICA, N.A., CANADA
Commitment: Cdn.$9,500,000 BRANCH, AS LENDER
Facility B
Commitment: Nil Per: /s/ Xxxxxx Xxx
---------------------------
Xxxxxx Xxx, Vice President
Swingline
Commitment (Fronting): Cdn.$5,000,000
Line of Credit
Commitment (Fronting): Cdn.$2,000,000
ADDRESS:
Corporate Banking
000 Xxxxx Xxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx, X0X 0X0
Attention: Xxxxxx Xxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxx.xxx@xxxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A CREDIT SUISSE FIRST BOSTON
Commitment: Cdn.$9,000,000 TORONTO BRANCH, AS LENDER
Facility B
Commitment: Nil
Per: /s/ Xxxxx Xxxxxx /s/ Xxxxx Xxxxxxx
--------------------------- -----------------
Authorized Signing Officer
Xxxxx Xxxxxx Xxxxx Xxxxxxx
Director Vice President
Contact:
1 First Canadian Place
P.O. Box 301, Suite 3000
Toronto, Ontario, M5X 1C9
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A CITIBANK N.A.,
Commitment: Cdn.$9,000,000 CANADIAN BRANCH, AS LENDER
Facility B
Commitment: US$____________ Per: /s/ Xxxx Xxxxxxxx
--------------------------
Authorized Signing Officer
Contact:
Xxxx Xxxxxxxx / Xxxxxxx Xxxxx
000 Xxxxx Xxxxxx, Xxxx
Xxxxxxx, Xxxxxxx
Citibank N.A. Canadian Branch
Telephone: (000) 000-0000
Fax: (000) 000-0000
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A THE TORONTO-DOMINION BANK,
Commitment: Cdn.$7,500,000 AS LENDER
Facility B Nil Per: /s/ Illegible
Commitment: --------------------------
Authorized Signing Officer
Per: /s/ [Illegible]
---------------------------
Authorized Signing Officer
Contact:
Xxxx Xxxxxxxx
00, Xxxxxxxxxx Xxxxxx West, 00xx Xxxxx
X.X.Xxx 0 XX Xxxxx
Xxxxxxx, XX X0X 0X0
Telephone: (000) 000-0000
Fax: (000) 000-0000
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A THE BANK OF NOVA SCOTIA,
Commitment: Cdn.$7,500,000 AS LENDER
Facility B
Commitment: Nil Per: /s/ Xxxxxx Xxxx
---------------------------
Authorized Signing Officer
Per: /s/ [Illegible]
---------------------------
Authorized Signing Officer
Contact:
Xxx Xxxx
00 Xxxx Xxxxxx X., 00xx Xxxxx
Xxxxxxx, XX Xxxxxx
Tel.: (000) 000-0000
Fax: (000) 000-0000
Email: xxx_xxxx@xxxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A ROYAL BANK OF CANADA,
Commitment: Cdn.$7,500,000 AS LENDER
Facility B
Commitment: US$0 Per: /s/ Xxxxxxx Xxxx-Coeur
-- --------------------------
Authorized Signing Officer
Per:
---------------------------
Authorized Signing Officer
Contact:
Xxxxxxx Xxxx-Coeur
Royal Bank of Canada
0, Xxxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A LA CAISSE CENTRALE XXXXXXXXXX DU
Commitment: Cdn.$5,000,000 QUEBEC, AS LENDER
Facility B
Commitment: US $5,000,000 Per: /s/ Xxxxx Xxx
---------------------------
Authorized Signing Officer
Per: /s/ [Illegible]
---------------------------
Authorized Signing Officer
Contact:
Xxxxx Xxx
Bureau 2822
Xxxxxxxx Xxxxxx X0X 0X0
Tel: (000) 000-0000
Fax: (000) 000-0000
Email: xxxxx.xxx@xxx.xxxxxxxxxx.xxx
(signatures continued from the preceding page)
NATIONAL CITY BANK,
AS LENDER
Facility B
Commitment: US$5,000,000 Per: /s/ Xxxxx Xxxxxxxx
-----------------------
Authorized Signing Officer
XXXXXXXXX XXXXXXXX
Senior Vice President
Contact:
Xx. Xxxxx Xxxxxxxx
0 Xxxxx Xxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx
00000 XXX
Fax: (000) 000-0000
phone: (000) 000-0000
e-mail: Xxxxxxxxx.Xxxxxxxx@xxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A NATIONAL CITY BANK, CANADA
Commitment: Cdn.$5,000,000 BRANCH AS LENDER
Facility B
Commitment: US$0 Per: /s/ Xxxxxxxx Xxxxx VP
-- -------------------
Authorized Signing Officer
Address: 000 Xxxx Xxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxx., X0X 0X0
Telephone: (000) 000-0000, ext. 224
Fax: (000) 000-0000
Credit Contact Information:
---------------------------
Xxxxxxxx Xxxxx xxxxxxxx.xxxxx@xxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A LAURENTIAN BANK OF CANADA,
Commitment: Cdn.$5,000,000 AS LENDER
Facility B
Commitment: US$3,000,000 Per: /s/ Xxxxx Xxxxxxx
-----------------------
Authorized Signing Officer
Per: /s/ [Illegible]
---------------------------
Authorized Signing Officer
Contact:
Xxxxx Xxxxxxx
1981, XxXxxx College Ave.,
Suite 1980
Xxxxxxxx, Xxxxxx, X0X 0X0
Tel: (514) 284-4500 ext. 4732
Fax: (000) 000-0000
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A BANK OF TOKYO-MITSUBISHI
Commitment: Cdn.$5,000,000 (CANADA), AS LENDER
Facility B
Commitment: US$ Nil Per: /s/ Xxxx Xxxxxxx
--------------------------
Authorized Signing Officer
Per:
---------------------------
Authorized Signing Officer
Contact:
Xxxx Xxxxxxx
000 xx xx Xxxxxxxxxxx Xxxx,
Xxxxx 0000
Xxxxxxxx Xxxxxx, Xxxxxx X0X 0X0
Tel: 000-0000
Fax: 000-0000
Email: xxxxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A BANK OF MONTREAL,
Commitment: Cdn.$5,000,000 AS LENDER
Facility B
Commitment: US$3,000,0000 Per: /s/ Xxxxx Xxx
--------------------------
Authorized Signing Officer
XXXXX XXX, VP
Per:
---------------------------
Authorized Signing Officer
Contact:
Xxxxx Xxx
1 First Canadian Place, 4F
Toronto, ON X0X 0X0
Xxxxxx
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxx.xxx@xxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A KZH ING-2LLC, AS LENDER
Commitment: [Nil]
Facility B
Commitment: US$1,000,0000 Per: /s/ Xxxxx Xxx
-----------------------
Authorized Signing Officer
XXXXX XXX
Authorized Agent
Per:
--------------------------
Authorized Signing Officer
Contact:
Xxxxxxxx Xxxxxx
C/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxxxx.x.xxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A KZH STERLING LLC, AS LENDER
Commitment: [Nil]
Facility B
Commitment: US$1,000,0000 Per: /s/ Xxxxx Xxx
--------------------------
Authorized Signing Officer
XXXXX XXX
Authorized Agent
Per:
---------------------------
Authorized Signing Officer
Contact:
Xxxxxxxx Xxxxxx
C/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxxxx.x.xxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A K2H CYPRESSTREE-1 LLC,
Commitment: Nil AS LENDER
Facility B
Commitment: US$1,000,0000 Per: /s/ Xxxxx Xxx
--------------------------
Authorized Signing Officer
XXXXX XXX
Authorized Agent
Per:
---------------------------
Authorized Signing Officer
Contact:
Xxxxxxxx Xxxxxx
C/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxxxx.x.xxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A KZH CNC LLC, AS LENDER
Commitment: [Nil]
Facility B
Commitment: US$ 1,000,000
Per: /s/ Xxxxx Xxx
--------------------------
Authorized Signing Officer
XXXXX XXX
Authorized Agent
Per:
--------------------------
Authorized Signing Officer
CONTACT:
Xxxxxxxx Xxxxxx
C/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxxxx.x.xxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A KZH SOLEIL LLC AS LENDER
Commitment: [Nil]
Facility B
Commitment: US$ 491,400
Per: /s/ XXXXX XXX
---------------------------
Authorized Signing Officer
XXXXX XXX
Authorized Agent
Per:
---------------------------
Authorized Signing Officer
CONTACT:
Xxxxxxxx Xxxxxx
C/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxxxx.x.xxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A KZH SOLEIL-2 LLC AS LENDER
Commitment: [Nil]
Facility B
Commitment: US$ 982,800
Per: /s/ Xxxxx Xxx
--------------------------
Authorized Signing Officer
XXXXX XXX
Authorized Agent
Per:
--------------------------
Authorized Signing Officer
CONTACT:
Attention: Xxxxxxxx Xxxxxx
C/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxxxx.x.xxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A KZH RIVERSIDE LLC AS LENDER
Commitment: [Nil]
Facility B
Commitment: US$ 474,600
Per: /s/ Xxxxx Xxx
---------------------------
Authorized Signing Officer
XXXXX XXX
Authorized Agent
Per:
---------------------------
Authorized Signing Officer
CONTACT:
Xxxxxxxx Xxxxxx
C/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Email: xxxxxxxx.x.xxxxxx@xxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A STANWICH LOAN FUNDING LLC
Commitment: Cdn.$0.00 AS LENDER
Facility B
Commitment: US$2,000,000
Per: /s/ Xxxxx X. Xxxxxxxxx
---------------------------
Xxxxx X. Xxxxxxxxx
Vice President
CONTACT:
Banc of America Securities LLC
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx / Xxxxxxx Xxxxxx / Xxxxx Xxxxxxx
Telephone: (000) 000-0000 / (000) 000-0000 / (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxx.x.xxxxxxxxx@xxxxxxxxxxxxx.xxx
xxx.x.xxxxxx@xxxxxxxxxxxxx.xxx
xxxxx.x.xxxxxxx@xxxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A TORONTO DOMINION (TEXAS), INC.
Commitment: Cdn$____ AS LENDER
Facility B
Commitment: US$7,000,000.00
Per: /s/ Xxxxx Xxxxxx
---------------------------
Authorized Signing Officer
XXXXX XXXXXX
VICE PRESIDENT
Per:
---------------------------
Authorized Signing Officer
CONTACT:
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx Xxxxxx
Vice President
Telephone: (000) 000-0000
Fax: (000) 000-0000
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A PINEHURST TRADING, INC. AS
Commitment: Cdn$0.00 LENDER
Facility B
Commitment: US$4,000,000
Per: /s/ Xxxxx X. Xxxxxxxxx
---------------------------
Xxxxx X. Xxxxxxxxx
CONTACT:
Banc of America Securities LLC
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx / Xxxxxxx Xxxxxx / Xxxxx Xxxxxxx
Telephone: (000) 000-0000 / (000) 000-0000 / (000) 000-0000
Facsimile: (000) 000-0000
Email: xxxxx.x.xxxxxxxxx@xxxxxxxxxxxxx.xxx
xxx.x.xxxxxx@xxxxxxxxxxxxx.xxx
xxxxx.x.xxxxxxx@xxxxxxxxxxxxx.xxx
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A THE TRAVELERS INSURANCE
Commitment: [Nil] COMPANY AS LENDER
Facility B
Commitment: US$ 2,500,000
Per: /s/ Xxxxxxx X. Xxxxxxx
---------------------------
Authorized Signing Officer
XXXXXXX X. XXXXXXX
INVESTMENT OFFICER
Per:
---------------------------
Authorized Signing Officer
CONTACT:
Xxxxxxx Xxxxxxx: xxxxxxx.x.xxxxxx@xxxx.xxx
Tel.: (000) 000-0000 Fax: (000) 000-0000
Address: The Travelers Ins. Co. c/o Citigroup Investments
000 Xxxxxxxx Xxxxxx,
P.O. Box 150449, 0xx Xxxxx
Xxxxxxxx, XX 00000-0000
(signatures continued on the next following page)
(signatures continued from the preceding page)
Facility A CITIGROUP INVESTMENTS
Commitment: [Nil] CORPORATE LOAN FUND INC. AS
LENDER
Facility B
Commitment: US$ 1,500,000
Per: /s/ Xxxxxxx X. Xxxxxxx
---------------------------
Authorized Signing Officer
XXXXXXX X. XXXXXXX
INVESTMENT OFFICER
Per:
--------------------------
Authorized Signing Officer
CONTACT:
Xxxx X. Console: Xxxx.X.Xxxxxxx@xxxx.xxx
Tel.: (000) 000-0000 Fax: (000) 000-0000
Address:
000 Xxxxxxxx Xxxxxx,
P.O. Box 150449, 0xx Xxxxx
Xxxxxxxx, XX 00000-0000
Also send all notices to:
Xxxx Xxxxxxxx: xxxxxxxxxx@xxxxxxxxxxx.xxx
Tel.: (000) 000-0000 Fax: (000) 000-0000
(signatures continued on the next following page)
SCHEDULE 1 - ACCOMMODATION NOTICE
TO: BANK OF AMERICA, N.A., as Administrative Agent
FROM:
SUN MEDIA CORPORATION DATE:
1) This Accommodation Notice and Certificate is delivered to you
pursuant to the credit agreement (the "CREDIT AGREEMENT") dated as of
February 7, 2003. All defined terms set forth in this Accommodation Notice
shall have the respective meanings set forth in the Credit Agreement.
2) We hereby request an [Accommodation/conversion] under
[Facility A or Term Facility B] of the Credit Agreement as follows:
(a) Date of Accommodation: _______________________________________
(b) Currency and amount of Aaccommodation: _______________________
(c) Type of Accommodation: _______________________________________
(d) Designated Period(s) (if any): _______________________________
(e) maturity date(s) (if applicable): ____________________________
(f) payment instruction (if any): ________________________________
3) We have understood the provisions of the Credit Agreement which are
relevant to the furnishing of this Accommodation Notice. To the extent that
this Accommodation Notice evidences, attests or confirms compliance with any
covenants or conditions precedent provided for in the Credit Agreement, we
have made such examination or investigation as was, in our opinion, necessary
to enable us to express an informed opinion as to whether such covenants or
conditions have been complied with.
4) WE HEREBY CERTIFY THAT, in our opinion, as of the date hereof:
(a) All of the representations and warranties of the Borrower contained
in Article 7 of the Credit Agreement (except where qualified in Article 7 as
being made as at a particular date) are true and correct in all material
respects on and as of the date hereof as though made on and as of the date
hereof.
(b) All of the covenants of the Borrower contained in Article 8 of the
Credit Agreement together with all of the conditions precedent to an Advance and
all other terms and conditions contained in the Credit Agreement have been fully
complied with.
(c) No Event of Default has occurred and no Default has occurred and is
continuing.
Yours truly,
SUN MEDIA CORPORATION
Per: _____________________
Title: ___________________
SCHEDULE 2 - NOTICE OF REPAYMENT
TO: BANK OF AMERICA, N.A., as Administrative Agent
FROM:
SUN MEDIA CORPORATION
DATE:
1) This notice of repayment is delivered to you pursuant to the Credit
Agreement dated as of February 7, 2003 entered into among
SUN MEDIA
CORPORATION and, INTER ALIA, Bank of America, N. A. as Administrative Agent
(as in effect on the date hereof, the "CREDIT AGREEMENT"). All defined terms
set forth in this notice shall have the respective meanings set forth in the
Credit Agreement.
2) We hereby advise you that we will be repaying the sum of
[Cdn. / US$_________ on __________as follows [INDICATE AMOUNT PAYABLE IN
RESPECT OF EACH FACILITY AS WELL AS THE TYPE OF ADVANCE TO BE REPAID].
3) As to an amount of [Cdn. / US$__________, the above-mentioned payment
should be treated as a [MANDATORY PREPAYMENT / VOLUNTARY PREPAYMENT]
under Section [2.05 / 2.06], which we understand will have the effect of
reducing the amount of Term Facility B by an equal amount (or by an
equivalent amount, if in US$). [IF THE PAYMENT IS A MANDATORY PREPAYMENT
RESULTING FROM AN ASSET SALE, IT WILL BE APPLIED PRO RATA TO PERMANENTLY
REDUCE TERM FACILITY B (UNLESS IT IS AN UNACCEPTABLE PAYMENT) AND
TEMPORARILY REDUCE FACILITY A, IF THERE ARE ANY ACCOMMODATIONS OUTSTANDING
UNDER FACILITY A; ANY OTHER MANDATORY PREPAYMENT, UNLESS IT IS AN
UNACCEPTABLE PAYMENT, WILL PERMANENTLY REDUCE TERM FACILITY B; IN ALL
CASES, PROVIDE DETAILS OF THE CALCULATIONS USED TO DETERMINE THE AMOUNTS.]
Yours truly,
SUN MEDIA CORPORATION
Per: _______________________
Title: _____________________
SCHEDULE 3 - OFFER TO TERM LENDERS
TO: [NAME OF TERM LENDER]
FROM: SUN MEDIA CORPORATION
DATE:
1) This offer of repayment is delivered to you pursuant to the Credit
Agreement dated as of February 7, 2003 entered into among SUN MEDIA
CORPORATION and, INTER ALIA, Bank of America, N.A. as Administrative Agent
(as in effect on the date hereof, the "CREDIT AGREEMENT"). All defined terms
set forth in this notice shall have the respective meanings set forth in the
Credit Agreement.
2) We hereby advise you that on [INSERT DATE, AT LEAST 10 AND NOT MORE
THAN 20 BUSINESS DAYS FROM THE DATE OF THIS OFFER] (the "PAYMENT DATE"), we
will be making a Mandatory Repayment of Term Facility B in an aggregate
amount of US $__________, of which your proportionate share, based on your
Commitment under Term Facility B, is US $__________ [INDICATE AMOUNT PAYABLE].
3) In accordance with the provisions of the Credit Agreement, you are
required to advise us in writing, with a copy to the Administrative Agent,
not less than 3 Business Days before the Payment Date if you wish to accept
the Mandatory Repayment in question, failing which you shall be deemed to
have accepted same.
Yours truly,
SUN MEDIA CORPORATION
Per: _______________________
Title: _____________________
SCHEDULE 4
APPLICABLE MARGINS
(per annum)
ACCOMMODATIONS UNDER FACILITY A:
-----------------------------------------------------------------------------------------------------------------
BA DRAWING FEE
AND LETTER OF
CREDIT FEE CDN.$ PRIME RATE
TIER LEVERAGE RATIO ADVANCES COMMITMENT FEES
-----------------------------------------------------------------------------------------------------------------
I GREATER THAN OR EQUAL TO 3.25:1 2.25% 1.25% .375%
-----------------------------------------------------------------------------------------------------------------
II GREATER THAN OR EQUAL TO 2.75:1
and LESS THAN 3.25:1 2.00% 1.00% .375%
-----------------------------------------------------------------------------------------------------------------
III LESS THAN 2.75:1 1.75% 0.75% .25%
-----------------------------------------------------------------------------------------------------------------
ADVANCES UNDER TERM FACILITY B:
-----------------------------------------------------------
US$ PRIME RATE
LIBOR ADVANCES
-----------------------------------------------------------
2.50% 1.50%
-----------------------------------------------------------
SCHEDULE 5
SECURITY AND SECURITY DOCUMENTS
1. Unconditional joint and several (solidary) guarantees (and, after the
occurrence of a Default which is continuing or an Event of Default, a
postponement of claims), by each of the Guarantors in favour of the
Administrative Agent on behalf of the Lenders, of the obligations of
the Borrower under the Credit Documents;
2. A first-ranking (subject only to Permitted Liens) pledge of all of the
shares of each direct and indirect subsidiary of the Borrower,
including a pledge of partnership and other similar ownership interests
where applicable;
3. First-ranking security (subject only to Permitted Liens) in favour of
the Administrative Agent on behalf of the Lenders, by way of a hypothec
on the universality of all of the movable and immovable property of the
Borrower and each of the Guarantors which property is or is deemed to
be located in the Province of Quebec (and/or, at the option of the
Agent, by way of a hypothec securing debentures ("DEBENTURES") granted
in favour of the Administrative Agent or a collateral agent designated
by the Administrative Agent as the holder of a power of attorney
("fonde de pouvoir") of the Lenders within the meaning of Article 2692
of the Civil Code of Quebec, as contemplated by Section 10.10 of the
Credit Agreement);
4. First-ranking (subject only to Permitted Liens) General Security
Agreements and mortgages charging all of the property and assets,
personal (movable) and real (immovable) of the Borrower and the
Guarantors, which property is located anywhere in Canada (outside of
Quebec) or in the USA (and/or, at the option of the Administrative
Agent, by way of a debenture or other instrument creating the same
Liens);
5. To the extent not already created in virtue of the Security conferred
under the previous paragraphs of this schedule, first-ranking
assignment by the Borrower and the Guarantors (other than such of same
as are domiciled in Quebec) by way of collateral security, of the
contracts governing or evidencing intellectual property rights (subject
to Permitted Liens, and to the extent not prohibited by the terms of
the agreements governing such rights) in favour of the Administrative
Agent on behalf of the Lenders;
6. By way of collateral security, to the extent permitted by applicable
Laws and to the extent not already created in virtue of the Security
conferred under the previous paragraphs of this schedule, a transfer
and assignment to the Administrative Agent (and/or the fonde de
pouvoir) on behalf of the Lenders, as its interest may appear, of
all of the right, title and interest of the Borrower and the
Guarantors in and to all indemnities, proceeds, benefits and
advantages arising under any insurance policy or contract protecting
the Borrower and the Guarantors and their personal (movable)
property and activities against any form of loss, including business
interruption and third party liability, and cause the Administrative
Agent (and/or the fonde de pouvoir) on behalf of the Lenders to be
named in all such policies as a named insured as its interest may
appear, and delivery to the Administrative Agent of certificates of
insurance in form and substance satisfactory to the Administrative
Agent;
provided that no security shall be granted over (i) the Assets of Toronto Sun
International, Inc., T.S. Printing Inc. and Florida Sun Publications, Inc., if
the Assets in question or the shares of each of them are sold in accordance with
the provisions of Section 8.02(d) of the Credit Agreement within 60 days from
the Closing Date, or (ii) the shares or Assets of Le Courrier du Sud (1998) Inc.
during such time as a Person who is not an Affiliate of the Borrower holds
shares in such company, or (iii) the shares/partnership units of any Person who
is not a wholly-owned direct or indirect subsidiary of the Borrower for so long
as there is a prohibition against such security under any applicable partnership
or shareholders' agreement.
In the event that the ability of any Guarantor to guarantee the obligations of
the Borrower under the Credit Agreement is restricted under applicable Law, its
Guarantee shall be structured in a manner to be determined by the Agent, acting
reasonably and in accordance with applicable Law.
SCHEDULE 6
MASTER ASSIGNMENT AND ASSUMPTION AGREEMENT - TERM FACILITY B
This Master Assignment and Assumption Agreement (this "ASSIGNMENT AND
ASSUMPTION") dated as of the Trade Date referred to below is entered into by and
between the party identified below as "ASSIGNOR" and each party identified on
each signature page hereto as an "ASSIGNEE". Capitalized terms used but not
defined herein shall have the meanings given to them in the Credit Agreement
identified below (as amended or modified from time to time, the "CREDIT
AGREEMENT"), receipt of a copy of which is hereby acknowledged by each Assignee.
The Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably and ratably
sells and assigns to each Assignee, and each Assignee hereby irrevocably
purchases and assumes from the Assignor, subject to and in accordance with
the Standard Terms and Conditions and the Credit Agreement, as of the
Effective Date referred to below (i) all of the Assignor's respective rights
and obligations under the Credit Agreement and any other documents or
instruments delivered pursuant thereto to the extent related to the amount
and percentage interest identified below the signature of that Assignee of
all the Assignor's respective outstanding rights and obligations under Term
Facility B (including without limitation any guarantees and Security included
in such facilities) and (ii) to the extent permitted to be assigned under
applicable law, all claims, suits, causes of action and any other rights of
the Assignor (in its capacity as a Lender) against any Person, whether known
or unknown, arising under or in connection with the Credit Agreement, any
other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the
foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause
(i) above (the rights and obligations sold and assigned pursuant to clauses
(i) and (ii) above being referred to herein collectively as to each Assignee,
the "ASSIGNED INTEREST"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.
1. Assignor: Bank of America, N. A.
2. Assignees and their
Assigned Interests: Listed on the signature pages attached
hereto
3. Borrower: Sun Media Corporation
4. Administrative Agent: Bank of America, N. A., as the
administrative agent under the Credit
Agreement referred to below
5. Credit Agreement: The Credit Agreement, dated as of
February 7, 2003 among the Borrower named
above, the Lenders parties thereto, and
the Administrative Agent named above
Master Assignment and Assumption Agreement for ________________
6. Aggregate Amount of Assigned Interests in Term Facility B:
Principal Amount of Term
Facility B, subject of
this assignment(1)
------------------------
US$_______________
US$_______________
7. Effective Date: As to each Assignee, as indicated on
attached signature page thereof
8. Trade Date: As to each Assignee, as indicated on
attached signature page thereof
The terms set forth in this Assignment are hereby agreed to:
ASSIGNOR: BANK OF AMERICA, N. A.
By: _______________________________________
Name:
Title:
Consent and Acceptance: BANK OF AMERICA, N. A.,
as Administrative Agent
By: _______________________________________
Name:
Title:
Consent and Acceptance:(2) SUN MEDIA CORPORATION, as Borrower
By: _______________________________________
Name:
Title:
----------
(1) Adjust to take into account any payments or prepayments made
between Trade Date and Effective Date.
(2) Obtain indicated consent(s) only if required by Credit Agreement.
Master Assignment and Assumption Agreement for ________________
ASSIGNEE: ____________________________________________
[NAME OF ASSIGNEE]
By: _________________________________________
[ENTITY SIGNING ON BEHALF OF ASSIGNEE](3)
By: _______________________________________
Name:
Title:
(4)Assignee is an Affiliate/Approved Fund of:
____________________________________________
[IDENTIFY LENDER]
Assigned Interest to this Assignee:
Principal Amount of Term
Facility B, subject of
this assignment(5)
------------------------
US$______________
US$______________
Trade Date: ________________________________________
Effective Date: ________________________________________(6)
----------
(3) Include if a general partner or manager of the Assignee is signing
on behalf of the Assignee.
(4) Include as applicable.
(5) Adjust to take into account any payments or prepayments made
between Trade Date and Effective Date.
(6) Effective date to be inserted by Administrative Agent.
Signature Page for Master Assignment and Assumption Agreement for ___________
ANNEX 1 TO ASSIGNMENT AND ASSUMPTION
STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT
AND ASSUMPTION AGREEMENT
1. REPRESENTATIONS AND WARRANTIES.
1.1. ASSIGNOR. The Assignor (a) represents and warrants that (i)
it is the legal and beneficial owner of each Assigned Interest, (ii) each
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Documents or any other instrument or document delivered
pursuant thereto, other than this Agreement, or any Collateral thereunder, (iii)
the financial condition of any Loan Party, any of its subsidiaries or Affiliates
or any other Person obligated in respect of any Loan Document or (iv) the
performance or observance by any Loan Party, any of its subsidiaries or
Affiliates or any other Person of any of their respective obligations under any
Loan Document.
1.2. ASSIGNEE. Each Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement, (iii) from and after the Effective Date, it shall be bound by
the provisions of the Credit Agreement and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 8.01 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision; (v) if the contemplated Assignment and
Assumption is under Facility A and occurs prior to an Event of Default which has
not been waived, it is not a non-resident of Canada within the meaning of the
Income Tax Act (Canada); and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Documents are
required to be performed by it as a Lender.
1.3 ASSIGNEE'S ADDRESS FOR NOTICES, ETC. Administrative Details
(including credit contact information, addresses, phone and facsimile
information and account and payment instructions) have been provided in the
Administrative Questionnaire previously delivered to the Administrative Agent.
2. PAYMENTS. From and after the Effective Date for each
Assignee, the Administrative Agent shall make all payments in respect of the
Assigned Interest for such Assignee (including payments of principal, interest,
fees and other amounts) to such Assignee whether such amounts have accrued prior
to, or on or after such Effective Date. The Assignor and such Assignee shall
make all appropriate adjustments in payments by the Administrative Agent for
periods prior to such Effective Date or with respect to the making of this
assignment directly between themselves.
3. GENERAL PROVISIONS. This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by, and construed in accordance with, the law
of the Province of Ontario.
Annex 1 -- Page 1
Master Assignment and Assumption Agreement for ____________________
SCHEDULE 6 (continued)
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the "ASSIGNMENT AND
ASSUMPTION") is dated as of the Effective Date set forth below and is entered
into by and between [INSERT NAME OF ASSIGNOR] (the "ASSIGNOR") and [INSERT NAME
OF ASSIGNEE] (the "ASSIGNEE"). Capitalized terms used but not defined herein
shall have the meanings given to them in the Credit Agreement identified below
(as amended, the "CREDIT AGREEMENT"), receipt of a copy of which is hereby
acknowledged by the Assignee. The Standard Terms and Conditions set forth in
Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment and Assumption as if set forth
herein in full.
For an agreed consideration, the Assignor hereby irrevocably
sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases
and assumes from the Assignor, subject to and in accordance with the Standard
Terms and Conditions and the Credit Agreement, as of the Effective Date inserted
by the Administrative Agent as contemplated below (i) all of the Assignor's
rights and obligations in its capacity as a Lender under the Credit Agreement,
the other Credit Documents and any other documents or instruments delivered
pursuant thereto to the extent related to the amount and percentage interest
identified below of all of such outstanding rights and obligations of the
Assignor under the respective facilities identified below (including without
limitation any letters of credit, guarantees, Security and Swingline Advances
included in such facilities) and (ii) to the extent permitted to be assigned
under applicable law, all claims, suits, causes of action and any other right of
the Assignor (in its capacity as a Lender) against any Person, whether known or
unknown, arising under or in connection with the Credit Agreement, any other
documents or instruments delivered pursuant thereto or the loan transactions
governed thereby or in any way based on or related to any of the foregoing,
including, but not limited to, contract claims, tort claims, malpractice claims,
statutory claims and all other claims at law or in equity related to the rights
and obligations sold and assigned pursuant to clause (i) above (the rights and
obligations sold and assigned pursuant to clauses (i) and (ii) above being
referred to herein collectively as, the "ASSIGNED INTEREST"). Such sale and
assignment is without recourse to the Assignor and, except as expressly provided
in this Assignment and Assumption, without representation or warranty by the
Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________
[and is an Affiliate/Approved Fund of
[IDENTIFY LENDER](7)]
3. Borrower(s): Sun Media Corporation
4. Administrative Agent: Bank of America, N. A., as the
administrative agent under the Credit
Agreement
5. Credit Agreement: The Credit Agreement dated as of February 7,
2003, among Sun Media Corporation, the
Lenders parties thereto, Bank of America
N.A., as Administrative Agent, and the
other agents parties thereto, for an
amount of US $230,000,000 and
Cdn.$75,000,000.
6. Assigned Interest:
------------------------------ ----------------------------- ----------------------------- ---------------------------
Facility Assigned(8) Aggregate Amount of Amount of Percentage Assigned of
Commitment/Loans for all Commitment/Loans Commitment/Loans(9)
Lenders* Assigned*
------------------------------ ----------------------------- ----------------------------- ---------------------------
$ $ %
------------------------------ ----------------------------- ----------------------------- ---------------------------
$ $ %
------------------------------ ----------------------------- ----------------------------- ---------------------------
$ $ %
------------------------------ ----------------------------- ----------------------------- ---------------------------
----------
(7) Select as applicable.
(8) Fill in the appropriate terminology for the types of facilities
under the Credit Agreement that are being assigned under this Assignment
(i.e. "Facility A Commitment," or "Term Facility B Commitment").
* Amount to be adjusted by the counterparties to take into account
any payments or prepayments made between the Trade Date and the Effective
Date.
(9) Set forth, to at least 9 decimals, as a percentage of the
Commitment/Loans of all Lenders thereunder.
[7. Trade Date: ______________](10)
Effective Date: _____________ ___, 20___ [TO BE INSERTED BY ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:______________________________
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:_____________________________
Title:
----------
(10) To be completed if the Assignor and the Assignee intend that the
minimum assignment amount is to be determined as of the Trade Date.
Consented to and Accepted:
BANK OF AMERICA N. A., as
Administrative Agent
By_________________________________
Title:
Consented to and Accepted in respect of Facility A, where applicable:
BANK OF AMERICA, N. A., Canada Branch
as Issuing Lender and Swingline Lender
By________________________________
Title:
Consented to and Accepted:
SUN MEDIA CORPORATION, as Borrower
By_________________________________
Title:
ANNEX 1
Credit Agreement entered into among Sun Media Corporation, as Borrower,
Bank of America, N. A., as Administrative Agent,
and the Lenders party thereto dated as of February 7, 2003
STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT AND ASSUMPTION
1. REPRESENTATIONS AND WARRANTIES.
1.1 ASSIGNOR. The Assignor (a) represents and warrants that
(i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Documents or any collateral thereunder, (iii) the
financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Credit Document or (iv) the
performance or observance by the Borrower, any of its Subsidiaries or Affiliates
or any other Person of any of their respective obligations under any Credit
Document.
1.2. ASSIGNEE. The Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement (subject to receipt of such consents as may be required under
the Credit Agreement), (iii) from and after the Effective Date, it shall be
bound by the provisions of the Credit Agreement as a Lender thereunder and, to
the extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it has received a copy of the Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to Section
8.01 thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase the Assigned Interest on the
basis of which it has made such analysis and decision independently and without
reliance on the Administrative Agent or any other Lender; (v) if the
contemplated Assignment and Assumption is under Facility A and occurs prior to
an Event of Default which has not been waived, it is not a non-resident of
Canada within the meaning of the Income Tax Act (Canada); and (b) agrees that
(i) it will, independently and without reliance on the Administrative Agent, the
Assignor or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Documents, and (ii) it will perform
in accordance with their terms all of the obligations which by the terms of the
Credit Documents are required to be performed by it as a Lender.
1.3 ASSIGNEE'S ADDRESS FOR NOTICES, ETC. Attached hereto as
Schedule 1 is all contact information, address, account and other administrative
information relating to the Assignee.
2. PAYMENTS. From and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned Interest
(including payments of principal, interest, fees and other amounts) to the
Assignee whether such amounts have accrued prior to, or on or after such
Effective Date. The Assignor and such Assignee shall make all appropriate
adjustments in payments by the Administrative Agent for periods prior to such
Effective Date or with respect to the making of this assignment directly between
themselves.
3. GENERAL PROVISIONS. This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption
(2)
by telecopy shall be effective as delivery of a manually executed counterpart
of this Assignment and Assumption. This Assignment and Assumption shall be
governed by, and construed in accordance with, the law of the Province of
Ontario.
SCHEDULE 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT
ADMINISTRATIVE DETAILS
(ASSIGNEE TO LIST NAMES OF CREDIT CONTACTS, ADDRESSES, PHONE
AND FACSIMILE NUMBERS, ELECTRONIC MAIL ADDRESSES AND INFORMATION)
SCHEDULE 7
GUARANTORS
XXXXX PUBLISHERS LIMITED
SUN MEDIA (TORONTO) CORPORATION
SMC NOMINEECO INC.
3661458 CANADA INC.
TORONTO SUN INTERNATIONAL, INC.
T.S. PRINTING, INC.
FLORIDA SUN PUBLICATIONS, INC.
3351611 CANADA INC.
SCHEDULE 8
SUBORDINATION AGREEMENT FOR
BACK-TO-BACK SECURITIES
This SUBORDINATION AGREEMENT is dated as of o, 200o (the "Agreement").
To: Bank of America, N.A., for itself and as Administrative Agent under the
Credit Agreement (defined below) for the Lenders (the "ADMINISTRATIVE
AGENT"), o , a o company (the "OBLIGOR"), as obligor under the o dated as of
o, and o in the principal amount of o $ o and o $ o, respectively, made by
the Obligor in favour of o (the "SUBORDINATED NOTES"), and o, as holder (the
"HOLDER") of the Subordinated Notes, for ten dollars and other good and
valuable consideration received by each of the Obligor and the Holder from
the Administrative Agent and by each of the Obligor and the Holder from the
other, agree as follows:
1. INTERPRETATION.
(a) "CASH, PROPERTY OR SECURITIES". "Cash, Property or Securities"
shall not be deemed to include securities of the Obligor or any other Person
provided for by a plan of reorganization or readjustment, the payment of
which is subordinated at least to the extent provided herein with respect to
the Subordinated Notes, to the payment of all Senior Indebtedness which may
at the time be outstanding; provided, however, that (i) all Senior
Indebtedness is assumed by the new Person, if any, resulting from any such
reorganization or readjustment, and (ii) the rights of the holders of the
Senior Indebtedness are not, without the consent of such holders, altered by
such reorganization or readjustment.
(b) "PAYMENT IN FULL". "payment in full", with respect to Senior
Indebtedness, means the receipt on an irrevocable basis of cash in an amount
equal to the unpaid principal amount of the Senior Indebtedness and premium,
if any, and interest and any special interest thereon to the date of such
payment, together with all other amounts owing with respect to such Senior
Indebtedness.
(c) "SENIOR INDEBTEDNESS". "Senior Indebtedness" means, at any date all
indebtedness (including, without limitation, any and all amounts of
principal, interest, special interest, additional amounts, premium, fees,
penalties, indemnities and "post-petition interest" in bankruptcy and any
reimbursement of expenses) under (1) the Indenture , including, without
limitation, the "Notes", the "Subsidiary Guarantees", the "Exchange Notes",
the "Additional Notes" and any Guarantee of the Exchange Notes or the
Additional Notes (in each case, as defined in the Indenture) and (2) the
Credit Agreement, dated as of February 7, 2003, among the Obligor, the
financial institutions identified as lenders therein, Banc of America
Securities LLC, as joint lead arranger, Bank of America, N.A., as
administrative agent, and Credit Suisse First Boston Corporation, as joint
lead arranger and syndication agent (the "CREDIT AGREEMENT"; capitalized
terms used herein without definition having the meanings set forth therein).
(2)
2. AGREEMENT ENTERED INTO PURSUANT TO CREDIT AGREEMENT. The Obligor,
the Administrative Agent and the Lenders are entering into this Agreement
pursuant to the provisions of the Credit Agreement, pursuant to which Sun
Media Corporation has borrowed US$230,000,000 and has additional borrowings
available of Cdn.$75,000,000 (the "ACCOMMODATIONS").
3. SUBORDINATION. The indebtedness represented by the Subordinated
Notes shall be subordinated as follows:
(a) AGREEMENT TO SUBORDINATE. The Obligor, for itself and its
successors and assigns, and the Holder agree that the indebtedness evidenced
by the Subordinated Notes (including, without limitation, principal,
interest, premium, fees, penalties, indemnities and "post-petition interest"
in bankruptcy and any reimbursement of expenses) is subordinate and junior in
right of payment, to the extent and in the manner provided in this Section 3,
to the prior payment in full of all Senior Indebtedness. The provisions of
this Section 3 are for the benefit of the Administrative Agent acting on
behalf of the holders from time to time of Senior Indebtedness under the
Credit Agreement, and such holders are hereby made obligees hereunder to the
same extent as if their names were written herein as such, and they
(collectively or singly) may proceed to enforce such provisions.
(b) LIQUIDATION, DISSOLUTION OR BANKRUPTCY.
(i) Upon any distribution of assets of the Obligor to creditors
or upon a liquidation or dissolution or winding-up of the
Obligor or in a bankruptcy, arrangement, liquidation,
reorganization, insolvency, receivership or similar case or
proceeding relating to the Obligor or its property or other
marshalling of assets of the Obligor:
(A) the holders of Senior Indebtedness shall be entitled
to receive payment in full of all Senior
Indebtedness before the Holder shall be entitled to
receive any payment of principal of or interest on,
or any other amount owing in respect of, the
Subordinated Notes;
(B) until payment in full of all Senior Indebtedness, any
distribution of assets of the Obligor of any kind or
character to which the Holder would be entitled but
for this Section 3 is hereby assigned to the holders
of Senior Indebtedness absolutely and shall be paid
by the Obligor or by any receiver, trustee in
bankruptcy, liquidating trustee, agents or other
Persons making such payment or distribution to, the
Administrative Agent behalf of the holders of Senior
Indebtedness under the Credit Agreement, as their
interests may appear; and
(C) in the event that, notwithstanding the foregoing,
any payment or distribution of assets of the
Obligor of any kind or character, whether in Cash,
Property or Securities, shall be received by the
(3)
Holder before all Senior Indebtedness is paid in
full, such payment or distribution shall be held in
trust for the benefit of and shall be paid over to
the Administrative Agent on behalf of the holders
of Senior Indebtedness under the Credit Agreement,
as their interests may appear, for application to
the payment of all Senior Indebtedness under the
Credit Agreement until all such Senior Indebtedness
shall have been paid in full after giving effect to
any concurrent payment or distribution to the
holders of Senior Indebtedness under the Credit
Agreement in respect of such Senior Indebtedness.
(ii) If (A) a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Obligor
or its property (a "REORGANIZATION PROCEEDING") is
commenced and is continuing and (B) the Holder does not
file proper claims or proofs of claim in the form required
in a Reorganization Proceeding prior to 45 days before
the expiration of the time to file such claims, then (1)
upon the request of the Administrative Agent, the Holder
shall file such claims and proofs of claim in respect of
the Subordinated Notes and execute and deliver such
powers of attorney, assignments and proofs of claim or
proxies as may be directed by the Administrative Agent to
enable it to exercise in the sole discretion of the
Administrative Agent any and all voting rights
attributable to the Subordinated Notes which are capable
of being voted (whether by meeting, written resolution or
otherwise) in a Reorganization Proceeding and enforce any
and all claims upon or in respect of the Subordinated
Notes and to collect and receive any and all payments
or distributions which may be payable or deliverable at
any time upon or in respect of the Subordinated Notes, and
(2) whether or not the Administrative Agent shall take the
action described in clause (1) above, the Administrative
Agent shall nevertheless be deemed to have such powers of
attorney as may be necessary to enable the Administrative
Agent to exercise such voting rights, file appropriate
claims and proofs of claim and otherwise exercise the powers
described above for and on behalf of the Holder.
(c) SUBROGATION. After all Senior Indebtedness is paid in full and
until the Subordinated Notes are paid in full, the Holder shall be subrogated
to the rights of the holders of Senior Indebtedness. For purposes of this
Section 3(c), a distribution made under this Section 3 to holders of Senior
Indebtedness which otherwise would have been made to the Holder, or a payment
made by the Holder to holders of Senior Indebtedness in respect of a turnover
obligation under this Section 3, is not, as between the Obligor and such
holder, a payment by the Obligor on Senior Indebtedness.
(d) RELATIVE RIGHTS. This Section 3 defines the relative rights of the
Holder and the holders of Senior Indebtedness. Nothing in this Section 3
shall:
(4)
(i) impair, as between the Obligor and the Holder, the
obligation of the Obligor, which is absolute and
unconditional, to pay the principal of and interest on the
Subordinated Notes in accordance with their terms; or
(ii) affect the relative rights of the Holder and creditors of
the Obligor other than the holders of Senior Indebtedness; or
(iii) affect the relative rights of the holders of Senior
Indebtedness among themselves or opposite the Obligor under
the Credit Documents; or
(iv) prevent the Holder from exercising its available remedies
upon a default, subject to the rights of the holders of
Senior Indebtedness to receive cash, property or other
assets otherwise payable to the Holder.
(e) SUBORDINATION MAY NOT BE IMPAIRED.
(i) No right of any holder of Senior Indebtedness to enforce
the subordination of indebtedness evidenced by the
Subordinated Notes shall in any way be prejudiced or
impaired by any act or failure to act by the Obligor or by
any such holder or the Administrative Agent, or by any
non-compliance by the Obligor with the terms, provisions or
covenants herein, regardless of any knowledge thereof which
any such holder or the Administrative Agent may have or be
otherwise charged with. Neither the subordination of the
Subordinated Notes as herein provided nor the rights of
the holders of Senior Indebtedness with respect
hereto shall be affected by any extension, renewal or
modification of the terms, or the granting of any security
in respect of, any Senior Indebtedness or any exercise or
non-exercise of any right, power or remedy with respect
thereto.
(ii) The Holder agrees that all indebtedness evidenced by the
Subordinated Notes will be unsecured by any Lien upon or
with respect to any property of the Obligor.
(iii) The Holder agrees not to exercise any offset or counterclaim
or similar right in respect of the indebtedness evidenced by
the Subordinated Notes except to the extent payment of such
indebtedness is permitted and will not assign or otherwise
dispose of the Subordinated Notes or the indebtedness which
it evidences unless the assignee or acquiror, as the case
may be, agrees to be bound by the terms of this Agreement.
(g) HOLDER ENTITLED TO RELY.
Upon any payment or distribution pursuant to this Section 3, the
Holder shall be entitled to rely (i) upon any order or decree of a
court of competent jurisdiction in which any proceedings of the
nature referred to in Section 3(b) are pending, (ii) upon a
certificate if the liquidating trustee or agent or other person in
such proceedings making such payment or distribution to the Holder
or its
(5)
representative, if any, or (iii) upon a certificate of the
Administrative Agent or any representative (if any) of the holders
of Senior Indebtedness for the purpose of ascertaining the persons
entitled to participate in such payment or distribution, the holders
of the Senior Indebtedness and other indebtedness of the Obligor,
the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this
Section 3.
4. ENFORCEABILITY. Each of the Obligor and the Holder represents and
warrants that this Agreement has been duly authorized, executed and delivered
by each of the Obligor and the Holder and constitutes a valid and legally
binding obligation of each of the Obligor and the Holder, enforceable in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; and on the date hereof, the Holder shall deliver an
opinion or opinions of counsel to such effect to the Administrative Agent for
the benefit of the Lenders.
5. MISCELLANEOUS.
(a) Until payment in full of all the Senior Indebtedness, the Obligor
and the Holder agree that no amendment shall be made to either of the
Subordinated Notes which would affect the rights of the holders of the Senior
Indebtedness.
(b) This Agreement may not be amended or modified in any respect, nor
may any of the terms or provisions hereof be waived, except by an instrument
signed by the Obligor, the Holder and the Administrative Agent.
(c) This Agreement shall be binding upon each of the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
Administrative Agent and each and every holder of Senior Indebtedness and
their respective successors and assigns.
(d) This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
(e) The Holder and the Obligor each hereby irrevocably agrees that any
suits, actions or proceedings arising out of or in connection with this
Agreement may be brought in any state or federal court sitting in The City of
New York or any court in the Province of Quebec and submits and attorns to
the non-exclusive jurisdiction of each such court.
(f) The Holder and the Obligor will whenever and as often as reasonably
requested to do so by the Administrative Agent, do, execute, acknowledge and
deliver any and all such other and further acts, assignments, transfers and
any instruments of further assurance, approvals and consents as are necessary
or proper in order to give complete effect to this Agreement.
(g) Each of the Holder and the Obligor irrevocably appoints CT
Corporation System, as its authorized agent in the State of New York upon
which process may be served in any such suit or proceedings, and agrees that
service of process upon such agent, and written notice of said service to CT
Corporation System, by the person serving the same to the addresses listed
below,
(6)
shall be deemed in every respect effective service of process upon the Holder
or the Obligor, as applicable, in any such suit or proceeding.
If to the Obligor:
-
If to the Holder:
-
Each of the Holder and the Obligor further agrees to take any and
all action as may be necessary to maintain such designation and appointment
of such agent in full force and effect for a period of ten years from the
date of this Agreement.
IN WITNESS WHEREOF, the Obligor and the Holder each have caused this
Agreement to be duly executed.
-
by ___________________________
Name: |X|
Title: |X|
-
by ___________________________
Name: |X|
Title: |X|
SCHEDULE 9
FORM OF NOTE
FOR VALUE RECEIVED, the undersigned (the "BORROWER"), hereby promises to pay
to _____________________ or registered assigns (the "LENDER"), in accordance
with the provisions of the Credit Agreement (as hereinafter defined), the
principal amount of each Accommodation from time to time made by the Lender
to the Borrower under that certain Credit Agreement, dated as of February 7,
2003 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the "CREDIT AGREEMENT;" the terms defined therein
being used herein as therein defined), among the Borrower, the Lenders from
time to time party thereto, and Bank of America, N.A., as Administrative
Agent, Issuing Lender and Swing Line Lender.
The Borrower promises to pay interest on the unpaid principal amount of each
Accommodation from the date of such Accommodation until such principal amount
is paid in full, at such interest rates and at such times as provided in the
Credit Agreement. All payments of principal and interest shall be made to the
Administrative Agent for the account of the Lender in US Dollars in
immediately available funds at the Administrative Agent's Office. If any
amount is not paid in full when due hereunder, such unpaid amount shall bear
interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per
annum rate set forth in the Credit Agreement.
This Note is one of the Notes referred to in the Credit Agreement, is
entitled to the benefits thereof and may be prepaid in whole or in part
subject to the terms and conditions provided therein. This Note is also
entitled to the benefit of all guarantees and is secured by the Security.
Upon the occurrence and continuation of one or more of the Events of Default
specified in the Credit Agreement, all amounts then remaining unpaid on this
Note shall become, or may be declared to be, immediately due and payable all
as provided in the Credit Agreement. Loans made by the Lender shall be
evidenced by one or more loan accounts or records maintained by the Lender in
the ordinary course of business. The Lender may also attach schedules to this
Note and endorse thereon the date, amount and maturity of its Loans and
payments with respect thereto.
The Borrower, for itself, its successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonour and non-payment of this Note.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE PROVINCE OF ONTARIO
SUN MEDIA CORPORATION
By: _______________________________
Name: _____________________________
Title: ____________________________
DISCLOSURE SCHEDULES
SCHEDULE 6.01(J)
REAL PROPERTY OF LOAN PARTIES TO BE MORTGAGED
- 0000 Xxxxxxxx Xxxxxx, Xxxx XxXxxxxx, Xxxxxxx
- 00000-000 Xxx., Xxxxx Xxxxx, Xxxxxxx
- 000 Xxxxxxx Xxx., Xxxxxx, Xxxxxxx
- 000 Xxxxxxx Xxxxxx, Xxx X. Xxx 0, Xxxx-0000XX, Xxxxxx, Xxxxxxx
- 0000-00 Xxx. Xxxxxxx, Xxxxxxx
- 10604-100 Street, Grande Prairie, Alberta
- 0000-00 Xxxxxx, Xxxxx, Xxxxxxx
- 0000-00 Xxxxxx, Xxxxx Xxxxx, Xxxxxxx
- 0000-00 Xxxxxx, Xxxxxxxxxx, Xxxxxxx
- 0000-00 Xxxxxx, Xxxxxxxxxx, Xxxxxxx
- 0000-00xx Xxxxxx, Xxxxxxx, Xxxxxxx
- 0000-00 Xxxxxx, Xxxx Xxxx, Xxxxxxx
- 0000-00xx Xxxxxx, Xxxxxxxxxx, Xxxxxxx
- 000 Xxxxxxxx Xxxxxx, Xxxx Xxxxx, Xxxxxxx
- 000 Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx
- 000 Xxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
- 00 Xxxx Xxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxx
- 00 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxx
- 00000-00 Xxxxxx Xxx 0000, Xxxxxxxxx, Xxxxxxx
- 000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxx
- 000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxx Xxxxxxxx
- 0000-00 Xxxxxx, Xxxxxx, Xxxxxxx
-0-
- 000-00xx Xx., Xxxxxxxxx, Xxxxxxx Xxxxxxxx
- 000 Xxxxxx Xx. Xxxxx, Xxxx Xxxxx, Xxxxxxx
- 000 Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxx
- York & Xxxxxxxxx, London, Ontario
- 000 XxXxxx Xxxxx, Xxxxx, Xxxxxxx
- 0000-00xx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx
- 00000-000 Xxxxxx, Xxxxxx Xxxxxxx, Xxxxxxx
SCHEDULE 7.01(a)
JURISDICTION OF INCORPORATION OR CONTINUATION
------------------------------------------------------------------------- --------------------------------------------
NAME JURISDICTION OF INCORPORATION
OR ORGANIZATION
------------------------------------------------------------------------- --------------------------------------------
Sun Media Corporation Continued and existing under the laws of
British Columbia
------------------------------------------------------------------------- --------------------------------------------
Xxxxx Publishers Limited Continued and existing under the laws of
British Columbia
------------------------------------------------------------------------- --------------------------------------------
Sun Media (Toronto) Corporation Continued and existing under the laws of
British Columbia
------------------------------------------------------------------------- --------------------------------------------
SMC Nomineeco Inc. Ontario
------------------------------------------------------------------------- --------------------------------------------
3661458 Canada Inc. Canada
------------------------------------------------------------------------- --------------------------------------------
Toronto Sun International, Inc. Delaware
------------------------------------------------------------------------- --------------------------------------------
T.S. Printing, Inc. Delaware
------------------------------------------------------------------------- --------------------------------------------
Florida Sun Publications, Inc. Delaware
------------------------------------------------------------------------- --------------------------------------------
3351611 Canada Inc. Canada
------------------------------------------------------------------------- --------------------------------------------
SCHEDULE 7.01(g)
PART I
------
LOCATION OF BUSINESS
------------------------------------------------------------------------- --------------------------------------------
NAME JURISDICTIONS
------------------------------------------------------------------------- --------------------------------------------
Sun Media Corporation Ontario, Alberta, Quebec, Manitoba,
New Brunswick
------------------------------------------------------------------------- --------------------------------------------
Xxxxx Publishers Limited Ontario, Alberta, Manitoba,
British Columbia, Saskatchewan
------------------------------------------------------------------------- --------------------------------------------
Sun Media (Toronto) Corporation Ontario
------------------------------------------------------------------------- --------------------------------------------
SMC Nomineeco Inc. Ontario
------------------------------------------------------------------------- --------------------------------------------
3661458 Canada Inc. Ontario
------------------------------------------------------------------------- --------------------------------------------
Toronto Sun International, Inc. Florida
------------------------------------------------------------------------- --------------------------------------------
T.S. Printing, Inc. Florida
------------------------------------------------------------------------- --------------------------------------------
Florida Sun Publications, Inc. Florida
------------------------------------------------------------------------- --------------------------------------------
3351611 Canada Inc. Quebec, Ontario
------------------------------------------------------------------------- --------------------------------------------
- 2 -
PART II
-------
LOCATION OF MINUTE BOOKS
---------------------------------- ------------------------------- ------------------------------- -------------------------------
NAME OF SUBSIDIARY HEAD OFFICE / REGISTERED CHIEF EXECUTIVE OFFICE MINUTE BOOKS
OFFICE
---------------------------------- ------------------------------- ------------------------------- -------------------------------
Sun Media Corporation 000 Xxxx Xxxxx 000 Xxxx Xxxxxx Xxxx 000 Xxxx Xxxxx
000 Xxxxxxx Xxxxxx Xxxxxxx, XX 000 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX X0X 0X0 Xxxxxxxxx, X.X.
X0X 0X0 X0X 0X0
---------------------------------- ------------------------------- ------------------------------- -------------------------------
3661458 Canada Inc. 000 Xxxx Xxxxxx Xxxx 000 Xxxx Xxxxxx Xxxx 000 Xxxxx Xxxxxx
Xxxxxxx, XX Toronto, ON Montreal, QC
M5A 3X5 X0X 0X0 X0X 0X0
---------------------------------- ------------------------------- ------------------------------- -------------------------------
3351611 Canada Inc. 000 Xxxxx Xxxxxx 000 Xxxx Xxxxxx Xxxx 300 Xxxxx Avenue
Montreal, QC Toronto, ON Xxxxxxxx, XX
X0X 0X0 X0X 0X0 X0X 0X0
---------------------------------- ------------------------------- ------------------------------- -------------------------------
SMC Nomineeco Inc. 000 Xxxx Xxxxxx Xxxx 000 Xxxx Xxxxxx Xxxx 000 Xxxxx Xxxxxx
Xxxxxxx, XX Toronto, ON Montreal, QC
M5A 3X5 X0X 0X0 X0X 0X0
---------------------------------- ------------------------------- ------------------------------- -------------------------------
Xxxxx Publishers Limited 000 Xxxx Xxxxx 000 Xxxx Xxxxxx Xxxx 000 Xxxx Xxxxx
000 Xxxxxxx Xxxxxx Xxxxxxx, XX 000 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX X0X 0X0 Xxxxxxxxx, X.X.
X0X 0X0 X0X 0X0
---------------------------------- ------------------------------- ------------------------------- -------------------------------
Sun Media (Toronto) Corporation 000 Xxxx Xxxxx 000 Xxxx Xxxxxx Xxxx 000 Xxxx Place
000 Xxxxxxx Xxxxxx Xxxxxxx, XX 000 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX X0X 0X0 Xxxxxxxxx, X.X.
X0X 0X0 X0X 0X0
---------------------------------- ------------------------------- ------------------------------- -------------------------------
Toronto Sun International, Inc. 000 Xxxxx Xxxxxx Xxxx 000 Xxxx Xxxxxx Xxxx 555 - 12th Street N.W.
Brandenton, Florida Toronto, ON Washington, D.C.
34208 M5A 3X5 20004-1202
---------------------------------- ------------------------------- ------------------------------- -------------------------------
T.S. Printing, Inc. 000 Xxxxx Xxxxxx Xxxx 000 Xxxx Xxxxxx Xxxx 555 - 12th Street N.W.
Brandenton, Florida Toronto, ON Washington, D.C.
34208 M5A 3X5 20004-1202
---------------------------------- ------------------------------- ------------------------------- -------------------------------
Florida Sun Publications, Inc. 000 Xxxxx Xxxxxx Xxxx 000 Xxxx Xxxxxx Xxxx 555 - 12th Street N.W.
Brandenton, Florida Toronto, ON Washington, D.C.
34208 M5A 3X5 20004-1202
---------------------------------- ------------------------------- ------------------------------- -------------------------------
SCHEDULE 7.01(I)
INTELLECTUAL PROPERTY
SEE ATTACHED.
--------------------------------------------------------------------------------
SUN MEDIA CORPORATION
NEWSPAPERS TRADEMARKS
--------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
- DATE ET NUMERO DE DEPOT
NOM DU PROPRIETAIRE - DATE ET NUMERO REPRESENTANT POUR MARCHANDISES
MARQUE DE COMMERCE OU DU REQUERANT D'ENREGISTREMENT SIGNIFICATION SERVICES
- DATE DE RENOUVELLEMENT
===================================================================================================================================
Dep. 28 aout 84 Journaux
TMO 527585
LE JOURNAL DE MONTREAL Corporation Sun Media Enr. 11 sept. 87 Swabey Xxxxxx Xxxxxxx
TMA 331770
Ren. 11 sept. 2017
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 28 aout 84 journaux
TMO 527584
LE JOURNAL DE Corporation Sun Media Enr. 09 janvier 87 Swabey Xxxxxx Xxxxxxx
MONTREAL & DESSIN TMA 322574
Ren. 09 janvier 2017
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 16 aout 93 journaux
TMO 735242
LE JOURNAL DE QUEBEC Corporation Sun Media Enr. 14 juin 96 Robic
TMA 459245
Ren. 14 juin 2011
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 16 aout 93 journaux
TMO 735240
LE JOURNAL DE Corporation Sun Media Enr. 14 oct. 00 Xxxxx
XXXXXX & DESSIN TMA 434519
Ren. 14 oct. 2009
-----------------------------------------------------------------------------------------------------------------------------------
- 2 -
-----------------------------------------------------------------------------------------------------------------------------------
- DATE ET NUMERO DE DEPOT
NOM DU PROPRIETAIRE - DATE ET NUMERO REPRESENTANT POUR MARCHANDISES
MARQUE DE COMMERCE OU DU REQUERANT D'ENREGISTREMENT SIGNIFICATION SERVICES
- DATE DE RENOUVELLEMENT
===================================================================================================================================
Dep. 8 aout 78 Periodical
TMO 428256 publications
THE CALGARY SUN Corporation Sun Media Enr. 12 septembre 80 Goodmans LLP
TMA 250371
Ren. 12 septembre 2010
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 18 juillet 80 Periodical
TMO 456366 publications
THE CALGARY SUN & DESIGN Corporation Sun Media Enr. 28 janvier 83 Goodmans LLP
TMA 276154
Ren. 28 janvier 2013
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 2 novembre 77 Periodical
TMO 417211 publications
THE EDMONTON SUN Corporation Sun Media Enr. 23 novembre 79 Goodmans LLP
TMA 237431
Ren. 23 novembre 2009
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 14 novembre 77 Periodical
TMO 0417594 publications
THE EDMONTON SUN & DESIGN Corporation Sun Media Enr. 19 octobre 1979 Goodmans LLP
TMA 236763
Ren. 19 octobre 2009
-----------------------------------------------------------------------------------------------------------------------------------
THE LONDON FREE PRESS Corporation Sun Media Not Registered
-----------------------------------------------------------------------------------------------------------------------------------
- 3 -
-----------------------------------------------------------------------------------------------------------------------------------
- DATE ET NUMERO DE DEPOT
NOM DU PROPRIETAIRE - DATE ET NUMERO REPRESENTANT POUR MARCHANDISES
MARQUE DE COMMERCE OU DU REQUERANT D'ENREGISTREMENT SIGNIFICATION SERVICES
- DATE DE RENOUVELLEMENT
===================================================================================================================================
Dep. 29 juillet 88 Periodical
TMO 612285 publications
THE OTTAWA SUN Corporation Sun Media Enr. 16 mars 90 Goodmans LLP
TMA 366894
Ren. 16 mars 2005
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 2 janvier 1990 Periodical
TMO 0647937 publications;
THE OTTAWA SUN & DESIGN Corporation Sun Media Enr. 12 juillet 1991 Goodmans LLP accessories
TMA 386601
Ren. 12 juillet 2006
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 10 avril 78 Periodical
TMO 423238 publications
THE TORONTO SUN & DESIGN Corporation Sun Media Enr. 25 janvier 80 Goodmans LLP
TMA 239437
Ren. 25 janvier 2010
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 10 avril 78 Periodical
TMO 423240 publications
THE TORONTO SUN & DESIGN Corporation Sun Media Enr. 1er fevrier 80 Goodmans LLP
TMA 239586
Ren. 1er fevrier 2010
-----------------------------------------------------------------------------------------------------------------------------------
Dep. 11 oct. 95 Journal
TMO 794585 quotidien
THE WINNIPEG SUN Corporation Sun Media Enr. 21 mars 97 Robic
TMA 473276
Ren. 21 mars 2012
-----------------------------------------------------------------------------------------------------------------------------------
SCHEDULE 7.01(j)
OWNED PROPERTIES
------------------------------------------------------------ ---------------------------------------------------------
NAME ADDRESS
------------------------------------------------------------ ---------------------------------------------------------
Sun Media Corporation Xxxxxxxx Xxxxxxxxxx Xxxx
00000 - 47 Street
Plan 7820294 Xxxxx 0 Xxx 0
Xxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
Xxxxxxxx Xxxxxxxxxx Xxxx
00000 - 47 Street
Plan 7820294 Xxxxx 0 Xxx 0
Xxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
Eastgate Industrial Park
Plan 7820294 Xxxxx 0 Xxx 0
Xxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
11260 - 228 Street West
Plan 8021483 Xxxxx 0 Xxx 0
Xxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 - 00 Xxxxxx XX
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
Xxxx & Xxxxxxxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxxxxxxx
Xxxxxxxx, Xxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxx
Xxxxxx, Xxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxxxx Xxxxx
Xxxx-Xxxx, Xxxxxx
------------------------------------------------------------ ---------------------------------------------------------
12625 - 1(ere) avenue
St-Georges, Beauce, Quebec
------------------------------------------------------------ ---------------------------------------------------------
- 2 -
------------------------------------------------------------ ---------------------------------------------------------
NAME ADDRESS
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxx. Xx-Xxxxxxxx
Xxxxxxxxx, Xxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 xx Xxxxxxx
Xxxxxxx-xx-Xxxx, Xxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxx Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
Xxxxx Publishers Limited 0000 Xxxxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxx Xxxxxx Xxxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxxxxxx Xxx.
Xxxx XxXxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00000-000 Xxx.
Xxxxx Xxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxx Xxx.
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxx Xxx.
Xxx X, Xxx 0, Xxxx-0000XX
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000-00 Xxx.
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00000-000 Xxxxxx
Xxxxxx Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00000-000 Xxxxxx
Xxxxxx Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000-00 Xxxxxx
Xxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000-00 Xxxxxx
Xxxxx Xxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000-00 Xxxxxx
Xxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxx. Xxx. Xxxx
Xxxxxxx Xx Xxxxxxx, Xxxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
- 3 -
------------------------------------------------------------ ---------------------------------------------------------
NAME ADDRESS
------------------------------------------------------------ ---------------------------------------------------------
00xx Xxxxxx XX
Xxxxxxx Xx Xxxxxxx, Xxxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0 Xxxxx Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxxx Xxxxx Xx. Xxxxx
Xxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxxxxx Xx
Xxxxxxxxx, X.X.
------------------------------------------------------------ ---------------------------------------------------------
0000-00 Xxxxxx
Xxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxxx, X.X.
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxx Xx. X
Xxxxxxx, Xxxx.
------------------------------------------------------------ ---------------------------------------------------------
00-00-00 Xxxxxx Xxxxxx
Xx. Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 00xx Xxxxxx
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000-00 Xxxxxx
Xxxx Xxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 XxXxxx Xxxxx
Xxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000-00xx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000-00xx Xxxxxx
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxx.
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
- 4 -
------------------------------------------------------------ ---------------------------------------------------------
NAME ADDRESS
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxxxx Xxxxxx
(also known as 00 Xxxxxx Xxxxxx)
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxxx Xxxxxx
(also known as 000 Xxxxxxxx Xxxxxx)
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxxx Xxxxxx
Xx. Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00 Xxxxxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
00000 00 Xxxxxx Xxx 0000
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, X.X.
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, X.X.
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, X.X.
------------------------------------------------------------ ---------------------------------------------------------
0000 00 Xxxxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 00 Xx.
Xxxxxxxxx, X.X.
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxx Xx. Xxxxx
Xxxx Xxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
- 5 -
------------------------------------------------------------ ---------------------------------------------------------
NAME ADDRESS
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
Sun Media (Toronto) Corporation Nil
------------------------------------------------------------ ---------------------------------------------------------
SMC Nomineeco Inc. 000 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
3661458 Canada Inc. Nil
------------------------------------------------------------ ---------------------------------------------------------
Toronto Sun International, Inc. Nil
------------------------------------------------------------ ---------------------------------------------------------
Florida Sun Publications, Inc. Nil
------------------------------------------------------------ ---------------------------------------------------------
T.S. Printing, Inc. 000 0xx Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000-0xx Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
0000 X.X. Xxxxxxx 00 Xxxxx
Xxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
000-0xx Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxx
------------------------------------------------------------ ---------------------------------------------------------
3351611 Canada Inc. Nil
------------------------------------------------------------ ---------------------------------------------------------
SCHEDULE 7.01(k)
LEASED PROPERTIES
-------------------- -------------------------------------------------------------------------------------------------
ADDRESS
-------------------- -------------------------------------------------------------------------------------------------
1. #250, 0000 00 Xxxxxx, Xxxxxxxx Xxxxxxx
-------------------- -------------------------------------------------------------------------------------------------
SCHEDULE 7.01(o)
MINORITY INTERESTS
In addition to the shares held by the Borrower in certain Guarantors, the
Borrower also holds shares or other interests in the following Persons:
------------------------------------------------------------------------ --------------------------------------------
NAME PERCENTAGE HELD
------------------------------------------------------------------------ --------------------------------------------
Le Courrier du Sud (1998) Inc. 50.01%
------------------------------------------------------------------------ --------------------------------------------
Dynamic Press Group Partnership 50%
------------------------------------------------------------------------ --------------------------------------------
SCHEDULE 7.01(r)
PENSION PLANS
- Sun Media Employees Pension Plan
- Retirement Plan for Employees of London Free Press
- Xxxxx Publishers Limited Pension Plan
- Pension Plan for Eligible Employees of the Stratford Beacon Herald, a
Division of Xxxxx Publishers Limited
- Supplemental Retirement Arrangements for Nine (9) Senior Executives
- Other Related Plans - Non Pension
- Targeted Registered Retirement Savings Plan (TRRIP)
- Florida Sun Employees 401(K)
PENSION PLANS OF EMPLOYEES OF DIVISIONS OF QUEBECOR MEDIA INC.
These plans cover all of the employees of all divisions of Quebecor Media Inc.:
- Pension plan for the employees of Quebecor Inc. and its subsidiaries
(unionized employees)
- Pension plan for the employees of Quebecor Inc. and its subsidiaries
which are not subject to a collective bargaining agreement
These plans cover exclusively the employees of Journal de Montreal:
- Pension plan for the employees who are members of the Syndicat des
Travailleurs de l'Information du Journal de Montreal
- Supplementary retirement plan for the preparation and shipping
employees of Journal de Montreal (a division of Communications
Quebecor Inc.) who are unionized
- Supplementary retirement plan for the unionized employees providing
press services for the printing of Journal de Montreal, a division of
Communications Quebecor Inc.
SCHEDULE 7.01(s)
MATERIAL AGREEMENTS
- Newsprint Purchase Agreement dated January 1, 2000 between Produits
Forestiers Xxxxxxx Inc., Sun Media Corporation and Imprimerie
Quebecor Inc.
- Purchase of Computer-to-Plate Equipment agreement between Agfa and
Sun Media Corporation [NOT EXECUTED]
- Purchase of Colour Units agreement dated October 10, 2002 between
le Journal de Montreal, a division of Sun Media Corporation, and
Printing Press Services International Ltd.
SCHEDULE 7.01(y)
CORPORATE STRUCTURE
(i) Shareholders of the Borrower
Please see attached.
(ii) Unanimous Shareholders or Other Agreements Relating to Shares Owned by
Such Shareholders
Nil.
[QUEBECOR MEDIA INC. CHART]
