VOTING TRUST AGREEMENT*
THIS
AGREEMENT made the 15th
day of August,
2007
BETWEEN:
CW
Media Inc., a corporation incorporated under the laws of Canada, and
the successor to AA Acquisition Corp. (formerly 6681859 Canada Inc.)
(“Amalco”)
-
and
-
Xxxxx
X. Xxxxxxxxx (hereinafter referred to as the
“Trustee”)
BACKGROUND:
Whereas
on January 10, 2007 AA Acquisition Corp., a subsidiary of CanWest MediaWorks
Inc. (“CanWest”), announced its agreement, subject to certain
conditions, to acquire all of the issued and outstanding shares of Alliance
Atlantis Communications Inc. (“AACI”) by way of a plan of
arrangement (the “Arrangement”);
And
Whereas AACI, through Alliance Atlantis Broadcasting Inc.
(“AABI”), owned shares and interests in entities (the
“Regulated Entities”) that hold various licences, permits,
franchises and authorizations issued by the Canadian Radio-television and
Telecommunications Commission (the “CRTC”) with respect to
specialty television broadcasting undertakings, as described in Schedule A
to
this agreement (the “Agreement”);
And
Whereas AA Acquisition Corp. completed the steps set out in the
Arrangement as a result of which Amalco acquired all of the issued and
outstanding shares of AACI;
And
Whereas prior to the completion of the Arrangement, AABI transferred
certain broadcasting assets and agreements and AACI transferred certain
designated broadcasting employees to a newly incorporated wholly-owned
subsidiary of AABI ("New AABI");
And
Whereas following the completion of the Arrangement, AA Acquisition
Corp. completed certain other transactions, including an intra-corporate
reorganization of AACI and its subsidiaries pursuant to which (i) AA Acquisition
Corp. was amalgamated in succession with AACI, Alliance Atlantis Productions
Ltd. and AABI to form Amalco and (ii) AACI’s businesses that are subject to
regulation by the
*
Certain material
has been omitted from this Voting Trust Agreement pursuant to a request for
confidential treatment and such omitted material has been filed separately
with
the U.S. Securities and Exchange Commission. Material omitted from
this agreement is replaced by an asterisk.
CRTC
were
separated from those that are not so regulated, all as more particularly
described in CRTC Application 0000-0000-0 (the
“Reorganization”);
And
Whereas following the Reorganization, Amalco now owns, among other
things, the shares of: (i) 4437420 Canada Inc., the corporation resulting from
the amalgamation of New AABI with a wholly-owned subsidiary of Amalco; (ii)
History Television Inc.; (iii) Life Network Inc.; (iv) Showcase Television
Inc.;
(v) 4437471 Canada Inc. (“SpecialtyWorks Holdco”), a
corporation that holds the shares of certain non-wholly owned Regulated Entities
indicated in Schedule A; and (vi) 4399781 Canada Inc, as well 50% of the
partnership interests of Historia and Séries+, S.E.N.C. These
entities are collectively referred to as the “Specialty TVCos”
and the shares and partnership interests in the Specialty
TVCos are collectively
referred to as the “STVCo Interests”. An
organizational chart depicting the post-Reorganization structure of the
Specialty TVCos is attached as Schedule B;
And
Whereas all of the shares of Amalco are owned by a holding corporation
of which CanWest indirectly owns 66 2/3% of the voting shares and GS Capital
Partners VI, L.P. (“GSCP”) indirectly owns 33 1/3% of the
voting shares;
And
Whereas the proposed transfer of control of the STVCo Interests to
Amalco will require the prior approval of the CRTC on terms acceptable to Amalco
(the “Transaction Approval”);
And
Whereas Amalco filed an application with the CRTC on May 4, 2007
requesting any required Transaction Approval;
And
Whereas, under the Broadcasting Act and its regulations,
Amalco is obligated not to exercise control over the operations of the Specialty
TVCos prior to the granting of the Transaction Approval by the
CRTC;
And
Whereas Amalco is of the view that the deposit with the Trustee of the
STVCo Interests to be held by the Trustee for the benefit of Amalco on and
subject to the terms herein contained is an appropriate mechanism to ensure
that
beneficial ownership of the STVCo Interests remain with Amalco, while ensuring
that all voting rights associated with the STVCo Interests (and hence effective
control) of AACI’s broadcasting undertakings, are exercised by an independent,
arm’s length party, pending the CRTC’s consideration of the proposed transfer of
control of the STVCo Interests, as per the CRTC’s policy regarding use of trust
arrangements as set out in Public Notice CRTC 1999-196;
And
Whereas the deposit of the STVCo Interests with the Trustee provides
assurance that Amalco’s obligation not to exercise control over the operations
of the Specialty TVCos prior to the granting of the Transaction Approval will
be
satisfied;
And
Whereas the establishment of this voting trust and the deposit of the
STVCo Interests with the Trustee in accordance with the terms of this Agreement
is consistent with Public Notice CRTC 1999-196;
1
And
Whereas the foregoing recitals are those of Amalco and not of the
Trustee;
Now
Therefore in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Amalco and the Trustee hereby
covenant and agree as follows:
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1.
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Creation
and Purpose of Voting
Trust
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Subject
to the terms and conditions of this Agreement, a voting trust (“Voting
Trust”) in respect of the STVCo Interests (collectively, the
“Deposited Securities”) is hereby created and established under
which, inter alia, legal title in and to the Deposited Securities is transferred
to the Trustee, and the Trustee hereby accepts the Voting Trust created hereby
and agrees to serve as trustee hereunder in accordance with the terms
hereof.
Subject
as provided below, the Voting Trust created hereby shall be
irrevocable:
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(a)
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until
Transaction Approval has been obtained on terms acceptable to Amalco
and
all of the Deposited Securities and other property then held by the
Trustee pursuant to this Agreement have been transferred into the
name of
and delivered to or to the order of Amalco as provided in paragraph
4(d) below;
or
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(b)
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2.
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Holding
of Deposited
Securities
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(a)
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Amalco
shall, following the completion of the Reorganization, subject to
any
guarantees and security interests granted in favour of any financial
institution(s) or other lender(s) (“Lender”) to secure
loans made by such Lender to Amalco or one or more parent entity
or
subsidiary entity of Amalco (collectively the “Borrower”)
to enable Amalco to acquire all or part of the STVCo Interests, or
to
secure additional loans and/or maintain operating loans, transfer
and
deliver to the Trustee all of the certificates representing the Deposited
Securities. Amalco shall ensure that any such guarantees or
security interests are subject to any applicable regulatory
requirements.
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(b)
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When
so requested by Amalco in writing, the Trustee shall deliver, from
time to
time, to Amalco acknowledgements in writing as to the number, class,
face
amount and other characteristics as applicable of the Deposited Securities
held by him at the time of such
request.
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2
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(c)
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Subject
to the requirements of any agreement granting any guarantees or security
interests in the Deposited Securities in favour of any Lender to
secure
loans made by such Lender to the Borrower, the Trustee shall retain
and
hold in Ontario the certificates representing the Deposited Securities
only in accordance with and subject to the terms and conditions set
forth
in this Agreement. Except where the Deposited
Securities are pledged to a Lender as contemplated in the preceding
paragraph, all certificates and other instruments evidencing the
Deposited
Securities shall at all times be and remain in the possession of
the
Trustee. As directed in writing by Amalco (but without becoming
personally liable with respect thereto), the Trustee shall cause
the
granting of guarantees and security interests (subject to applicable
regulatory requirements) or give acknowledgements of any existing
guarantees or security interests referred to in paragraph 2(a)
above, in the Deposited
Securities securing loans made by one or more Lenders to the
Borrower. The Trustee shall not cause the execution of any
hypothecation agreement unless it contains provisions stating
that:
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(i)
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voting
rights for any pledged shares or other interests and all rights of the
Trustee hereunder will remain with the Trustee, even in the event
of a
default by the Borrower on the loans (a
“Default”);
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(ii)
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in
the event of a Default, there will be a public or private sale of
the
pledged shares or other instruments or interests that are Deposited
Securities; and
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(iii)
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prior
to the exercise of rights by the secured party or by a purchaser
of such
shares or other instruments or interests that are Deposited Securities,
the prior approval of the CRTC, if required, will be
obtained.
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The
Trustee shall have no authority to sell, transfer, assign, pledge or otherwise
dispose of or encumber the Deposited Securities, except to the extent otherwise
specifically provided in this Agreement.
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3.
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Maintenance
of Records
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The
Trustee shall maintain such records and books as are necessary or appropriate
to
enable the Trustee to carry out the terms and conditions of this
Agreement.
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4.
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Voting
and Other Actions by
Trustee
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(a)
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During
the term of this Agreement, all voting rights with respect to the
Deposited Securities, and the right as shareholder or partner to
take part
in or consent to any corporate or shareholder or partner action of
any
kind with respect to the Specialty TVCos shall be vested in and exercised
by the Trustee, subject to the terms of any existing shareholder
agreement
or other agreement relating to the SpecialtyTVCos or any of the Regulated
Entities.
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(b)
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During
the term of this Agreement, and subject to the terms of any existing
shareholder agreement or other agreement relating to the Specialty
TVCos
or any of the Regulated Entities, the Trustee shall vote or cause
the
Deposited Securities to be voted, and otherwise exercise such voting
rights and rights as shareholder or partner, as
follows:
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(i)
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to
cause such actions to be taken as the Trustee may deem necessary
so as to
maintain the continuity of the operations and general character of
the
Specialty TVCos in the ordinary course of their respective businesses,
including satisfying commitments that are legally binding on the
Specialty
TVCos, including, for greater certainty, to vote against any sale
of
assets outside the ordinary course of
business;
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(ii)
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to
require a shareholders meeting to be held if necessary and to remove
from
office by ordinary resolution, in accordance with advice from his
legal
advisor, who, to the best of the Trustee’s knowledge, shall not be legal
counsel to Amalco, GSCP or any of their respective shareholders,
affiliates or subsidiaries (“Legal Advice”), any director
of the Specialty TVCos who the Trustee believes, acting reasonably,
will
not in the future be an Assisting Director. For these purposes,
an “Assisting Director” is any person who does not
oppose, impede or impair the completion of the Arrangement or the
Reorganization, who renders to the Trustee and Amalco all assistance
necessary to effect the Reorganization, who at all times acts in
a manner
consistent with effecting the Arrangement and the Reorganization
and
maintaining the continuity of the operations and general character
of the
Specialty TVCos in the ordinary course of their respective businesses
(including satisfying commitments that are legally binding on the
Specialty TVCos), who does not waste corporate assets or otherwise
act in
a manner inconsistent with the fiduciary responsibilities of a director
and who provides written confirmation
(a “Confirmation”) when requested
to do so by the Trustee that the director is and intends in the future
to
be an Assisting Director;
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(iii)
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in
any manner necessary based on Legal Advice, to elect or appoint as
directors of the Specialty TVCos such additional individuals as the
Trustee in his absolute discretion determines (which may include
the
Trustee), provided that any individual to be elected or appointed
as
director has provided to the Trustee a Confirmation and the Trustee
believes, acting reasonably, that the individual will be an Assisting
Director, to vacancies on the board of directors of the Specialty
TVCos
during the term of this Agreement;
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(iv)
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to
replace any member of the board of directors of the Specialty TVCos
who
resigns or is removed for cause as specified
in
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4
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subparagraph
4(b)(ii). In
exercising these
powers to elect or appoint new directors, the Trustee shall not appoint
a
person who, to the best of the Trustee’s knowledge, is a partner, officer,
employee, director, shareholder, subsidiary, affiliate or competitor
(other than the Specialty TVCos), of Amalco or GSCP, or who, to the
best
of the Trustee’s knowledge, has any professional business or familial
relationship with Amalco or GSCP or any partner, officer, employee,
director, shareholder, subsidiary, affiliate, or, competitor (other
than
the Specialty TVCos), of Amalco or GSCP (any such person so related
to
Amalco or GSCP being hereinafter referred to as a “Disqualified
Person”);
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(v)
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subject
to subparagraphs (i), (ii),
(iii)
and (iv) of this paragraph 4(b),
in the Trustee’s absolute
discretion based on Legal Advice, to re-elect or re-appoint at annual
shareholders meetings of the Specialty TVCos and any other shareholders
meetings of the Specialty TVCos at which directors are to be elected,
or
to appoint each director of the Specialty TVCos who was a director
prior
to such meeting and otherwise to fill vacancies existing on the board
of
directors of the Specialty TVCos;
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(vi)
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to
deliver to the Specialty TVCos and to each of their directors a written
declaration requiring that copies of all monthly management and
operational reports and financial data relating to the Specialty
TVCos
that are prepared in the ordinary course of business and such other
reports the Trustee considers reasonably necessary to direct and
supervise
and monitor the operations of the Specialty TVCos, shall be delivered
to
the Trustee and providing that the powers of such directors are restricted
in that they may not use such powers to cause the Specialty TVCos
to carry
on business except in the ordinary
course;
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(vii)
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in
the manner necessary so that the Specialty TVCos shall carry on business
in the ordinary course, not make or permit any changes out of the
ordinary
course, except as provided for in this Agreement or as contemplated
by the
Reorganization. Except as contemplated by the
Reorganization, the Trustee agrees that he intends
to cause the Specialty TVCos to operate only in the ordinary course,
consistent with past practice, applicable legal and regulatory
requirements and conditions of licences, and in particular, to cause
the
Specialty TVCos to act in a manner designed to safeguard their assets,
maintain the continuity of their operations, including maintaining
in good
standing all licences issued to the Specialty TVCos, maintain the
general
character of the Specialty TVCos’ operations and preserve their business
organization and relationships with customers, suppliers and
others. To such end, the Trustee and/or the Specialty TVCos
may
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enter
into such arrangements on commercial terms for the supply of services
as to enable the Specialty TVCos to carry on their
businesses in the ordinary course and consistent with past
practice;
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(viii)
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upon
notice in writing from Amalco, to obtain such waivers or consents
from the
Lenders to the Borrower as are necessary to permit
the transfer of the Deposited Securities to the Trustee in accordance
with
the terms of this Agreement; or, to the extent such consents or waivers
cannot be obtained, to obtain replacement financing on terms acceptable
to
Amalco;
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(ix)
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in
order to:
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(A)
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obtain
for Amalco all written information and provide such commercially
reasonable assistance as may be requested by Amalco in writing from
the
Specialty TVCos in order to obtain Transaction Approval (including,
without limitation, by making any applications and giving any consents
required for such
purpose); and
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(B)
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obtain
(to the extent not already obtained) all approvals, consents and
waivers
(other than Transaction Approval) required to implement the Reorganization
or to avoid or cure any breach of any applicable law or of the obligations
of the Specialty TVCos under any material agreement or any loss or
threatened loss of any material rights of the Specialty TVCos as
a result
of the Reorganization and satisfy all conditions attached to all
such
approvals, consents and waivers and Transaction
Approval;
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and
in
the event that, based on Legal Advice, the Trustee determines that any director
of the Specialty TVCos is preventing such Specialty TVCos from complying, or
refusing to give any authorization required to enable the Specialty TVCos to
comply, or is otherwise opposing, impeding or impairing such compliance, the
Trustee shall, to the extent within the Trustee’s power and control, vote or
cause the Deposited Securities to be voted and otherwise exercise such voting
rights and rights as a shareholder to remove such director from office in
accordance with Legal Advice.
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(c)
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No
person other than the Trustee shall have any voting rights in respect
of
any of the Deposited Securities so long as this Agreement is in effect;
provided that the Trustee may appoint a proxy to vote the Deposited
Securities solely in the manner directed by the Trustee. The
Trustee shall have no direct or indirect beneficial interest in the
Deposited Securities, and shall only have such voting and other rights
as
are specified in this Agreement.
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(d)
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The
Trustee shall cause the certificates and all other documents representing
all of the Deposited Securities then held by the Trustee to be transferred
into the name of and delivered to or to the order of Amalco, and
shall
take all other actions appropriate to effectuate the transfer and
delivery
to or to the order of Amalco, of legal title to the Deposited Securities
and all other property then held by the Trustee pursuant to this
Agreement
at such time as:
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(i)
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Transaction
Approval on terms acceptable to Amalco has been granted and such
approval
has become effective or such approval is no longer necessary;
and
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(ii)
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the
Trustee receives a written notice from Amalco authorizing such transfer
and delivery.
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(e)
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If
Amalco, by notice in writing to the Trustee (a “Request Sale
Notice”), informs the Trustee that it has not obtained
Transaction Approval on terms acceptable to Amalco and is of the
view that
Transaction Approval on terms acceptable to Amalco will not, in any
event,
be obtained thereafter, then, subject as hereinafter provided, the
Trustee, acting for the benefit of Amalco, to the extent within the
Trustee’s power and control and subject to the rights of other Specialty
TVCos securityholders, shall sell the Deposited Securities or the
securities or assets of the Specialty TVCos as soon as practicable,
consistent with the objective of obtaining the best value reasonably
obtainable to Amalco on an after tax basis and after reasonable
consultation with Amalco as to the terms and proposed parties to
any such
transaction based on advice received from those advisors he deems
appropriate, provided such advisors are not, to the best of the Trustee’s
knowledge, immediately prior to and during the term of this Agreement,
advisors to, and do not have any material professional, business,
or
familial relationship with Amalco, GSCP or their respective shareholders,
subsidiaries, or affiliates (“Advice”) including, without
limitation, causing the Specialty TVCos to be reorganized and/or
to pay
dividends and to make distributions on their respective securities
as the
Trustee determines based on Advice so as to maximize after-tax
proceeds. The Trustee shall, in a manner consistent with the
Trustee’s fiduciary obligations hereunder, have discretion in determining
the sale procedure in selecting the purchasing party or parties and
in
determining the terms of such sales with a view to obtaining the
best
value reasonably obtainable; provided, however, that Amalco may withdraw
the Request Sale Notice at any time prior to the consummation of
any such
sale, subject to the independent concurrence by the Trustee based
on
Advice as to such withdrawal. All sales shall be conducted in
compliance with applicable securities laws, and shall be subject
to such
prior regulatory approvals as may be required. Nothing herein
provides, nor shall it be construed to provide, Amalco with an absolute
veto over any such sales. Amalco
shall
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execute
all documentation and take all steps necessary to allow the Trustee
to
discharge its obligations under this paragraph 4.
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(f)
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During
the term of the Voting Trust, Amalco by notice in writing to the
Trustee,
may require the Trustee from time to time to take any step, action
or
proceeding as may be necessary or advisable in connection with obtaining
any required regulatory approvals, including the disposition or proposed
disposition of the securities or assets of the Specialty TVCos (a
“Regulatory Disposition”), as set out in such notice (a
“Regulatory Disposition Notice”). Upon a
Regulatory Disposition Notice being given, the Trustee shall take
all
action required by Amalco in such notice to cause the Specialty TVCos,
to
the extent necessary, to comply with such notice and to render all
assistance required by Amalco in connection therewith in the manner
and
upon the terms set out in Amalco’s notice subject to any requirements of
applicable law.
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(g)
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After
obtaining Transaction Approval on terms acceptable to Amalco, Amalco
by
notice in writing to the Trustee may require the Trustee from time
to
time, to the extent within the Trustee’s power and control and subject to
the rights of other Specialty TVCos securityholders, to take any
step,
action or proceeding in connection with the business, corporate and
capital structure of the Specialty TVCos and/or the disposition or
proposed disposition of the securities or assets of the Specialty
TVCos
set out in such notice. Upon any such notice being given, the
Trustee shall take all action required by Amalco in such notice to
cause
the Specialty TVCos, to the extent necessary, to comply with such
notice
and to render all assistance required by Amalco in connection therewith
in
the manner and upon the terms set out in Amalco’s notice subject to any
requirements of applicable law.
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(h)
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The
Trustee shall have the power and shall take such further actions
(including, but not limited to, taking legal action) to render and
cause
the Specialty TVCos, to the extent applicable or necessary, finalize,
execute and deliver any and all such further documents, agreements,
authorizations, elections or other instruments in respect of the
Reorganization, including any agreements, guarantees, security agreements
and related documentation requested by the Lenders pursuant to any
financing arrangements of the
Borrower;
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(i)
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Subject
to the terms of this Agreement, if the Trustee receives an offer
for the
acquisition of the Deposited Securities, the Trustee shall reject
any such
offer, unless expressly advised otherwise by Amalco in
writing.
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5.
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Restricted
Material Agreements
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(a)
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Schedule
C sets out a list of restricted material agreements that Amalco will
not
be assigning to New AABI as part of the Reorganization
(the
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“Restricted
Material Agreements”). Amalco agrees to hold the Restricted
Material Agreements for the benefit of New AABI, and in this regard
undertakes to:
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(i)
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enforce
the rights of Amalco under the Restricted Material Agreements against
the
issuer thereof or the other parties
thereto;
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(ii)
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refrain
at all times from
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(A)
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using
any such Restricted Material Agreements for its own purposes or for
exercising any control over the operations of the Specialty TVCos;
and
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(B)
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assigning
or providing the benefit of any such Restricted Material Agreement
to any
other party, including CanWest, GSCP or any of their respective
shareholders, affiliates or subsidiaries (other than the Specialty
TVCos);
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(iii)
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pay
or cause to be paid to one or more of the Specialty TVCos all monies
collected by or paid to Amalco in respect of such Restricted Material
Agreements;
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(iv)
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take
all such actions and do, or cause to be done, all such things as
New AABI
may reasonably require in order that the value and benefits of the
applicable Restricted Material Agreements shall be preserved and
enure to
the benefit of New AABI; and
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(v)
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provide
reports to New AABI on a periodic basis, and otherwise when requested
in
writing by New AABI, concerning the status of the Restricted Material
Agreements and any actions taken in relation thereto, and consult
with New
AABI in advance of taking any such actions or doing, or causing to
be done
any thing in relation to the Restricted Material
Agreements.
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(b)
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6.
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Concerning
the Trustee
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(a)
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Subject
to the provisions of this Agreement, the Voting Trust created hereby
shall
be managed by the Trustee.
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(b)
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The
Trustee shall be entitled to receive compensation for his services
hereunder at the times and in the amounts as may be agreed to in
writing
between the Trustee and Amalco.
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(c)
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The
Trustee is expressly authorized to incur and pay all reasonable charges
and other expenses which the Trustee deems necessary and
proper
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in
the performance of the Trustee’s duties under this Agreement, including
for legal counsel and other advisors of his choosing retained on
a per
diem or hourly basis as the Trustee deems appropriate (or, in the
event of any requirement for an advisor in connection with a disposition
or proposed disposition under paragraph 4(e), 4(f)
or 4(g) above, retained on such
other
reasonable basis as the Trustee deems appropriate) as well as for
office
space and equipment and clerical assistance as the Trustee may reasonably
require to allow the Trustee to perform the Trustee’s duties
hereunder. Amalco hereby agrees to reimburse and to indemnify
the Trustee against all claims, costs of defence (including reasonable
attorneys’ fees and disbursements), expenses and liability incurred by the
Trustee in connection with the performance of the Trustee’s duties under
this Agreement, except those incurred as a result of the Trustee’s gross
negligence, intentional wrongful action or wilful
misconduct. Amalco agrees to make any payments to the Trustee
pursuant to this paragraph within thirty (30) days of submission
by the
Trustee of an invoice or xxxx therefor, plus appropriate supporting
documentation. In the case of any fees and disbursements of any
legal or other advisor retained by the Trustee, the Trustee will
arrange
for copies of the accounts therefor to be given to Amalco and to
set out
therein in reasonable detail a description of the services rendered
together with appropriate supporting
documentation.
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(d)
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The
Trustee shall be free from liability in acting upon any paper, document
or
signature believed by the Trustee to be genuine and to have been
signed by
the proper party. The Trustee shall not be liable for any error
of judgment in any act done or omitted, nor for any mistake of fact
or
law, nor for anything which the Trustee may do or refrain from doing
in
good faith. In order to obtain Legal Advice and Advice, the
Trustee may consult with legal, accounting and business advisors
of his
own choosing. Wherever in this Agreement it is provided that
the Trustee my take (or not take) some step, action or proceeding
based on
or in accordance with Legal Advice or Advice, so obtaining such Advice
or
Legal Advice and acting (or refraining from so acting) thereupon
shall be
optional to the Trustee and the obtaining of such Advice or Legal
Advice
shall not be a condition precedent to the taking (or the refraining
from
taking) of such step, action or proceeding. Nevertheless, any
action, step or proceeding taken (or not taken) in good faith by
the
Trustee and in accordance with the Legal Advice or other Advice,
as
appropriate, (whether or not it is provided in this Agreement that
such
step, action or proceeding is to be taken (or not taken) based upon
or in
accordance with Legal Advice or Advice) shall be conclusive on the
parties
to this Agreement and the Trustee shall be fully protected and be
subject
to no liability in respect thereto.
|
|
|
(e)
|
The
rights and duties of the Trustee hereunder shall terminate upon the
Trustee’s bankruptcy, insolvency or death, and no interest in any of the
Deposited Securities held by the Trustee or any of the rights and
duties
of
|
10
|
|
a
Trustee may be transferred in any manner except as provided in this
Agreement. The trustee or other personal representatives of a
bankrupt, insolvent or deceased Trustee shall, however, have the
right and
duty to convey any Deposited Securities held by the Trustee to one
or more
successor Trustees.
|
|
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(f)
|
The
Trustee may resign by giving thirty (30) days’ advance written notice of
resignation to Amalco; provided that a successor Trustee has been
appointed and such appointment has received all necessary regulatory
approvals and any orders granting such approval have become final
orders
with respect to which no actions, requests for stay, petitions for
rehearing or reconsideration, or appeals are pending, and as to which
the
time for filing any such request, petition or appeal has
expired. Amalco shall not unreasonably delay in the appointment
of a successor Trustee.
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|
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(g)
|
So
long as the removal of the Trustee and the appointment of a successor
Trustee have first received all necessary regulatory approval and
any
orders granting such approval have become final orders with respect
to
which no actions, requests for stay, petitions for rehearing or
reconsideration, or appeals are pending, and as to which the time
for
filing any such request, petition or appeal has expired and the successor
Trustee is appointed contemporaneously with the removal of the Trustee,
Amalco may remove the Trustee on ten (10) days’ written notice to the
Trustee.
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(h)
|
In
the event of the resignation, bankruptcy, insolvency or death of
the
Trustee, he shall be succeeded, subject to such prior approvals of
the
CRTC as may be required, by a successor Trustee chosen by
Amalco. Any successor Trustee shall succeed to all of the
rights and obligations of the Trustee replaced hereunder upon the
execution by such successor Trustee of a counterpart of this
Agreement.
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|
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(i)
|
The
Trustee warrants that he is not a Disqualified Person and that he
is not a
non-Canadian within the meaning of the Direction to the CRTC
(Ineligibility of Non-Canadians) SOR/97-192, 1997 Canada
Gazette Part 11, p. 1222 (“Non-Canadian”) and will
not take any action that will constitute him a Disqualified Person
or a
Non-Canadian during his tenure as Trustee. Any successor
Trustee designated pursuant to paragraphs (f), (g) and (h) of this
Section
5 shall not be a Disqualified Person or a
Non-Canadian.
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|
7.
|
Beneficial
Ownership of Shares, Dividends, Distribution of Proceeds of Sale
of Shares
or Assets
|
Subject
to the requirements of any agreement granting any security interest in the
Deposited Securities in favour of any Lender to secure loans made by such Lender
to the Borrower as provided in this Agreement, Amalco shall remain
the
11
beneficial
owner of the Deposited Securities and all income of the Specialty TVCos shall
accrue to the benefit of Amalco and:
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|
(a)
|
Amalco
or its designee shall be entitled to receive, from time to time,
payments
of dividends, interest, or other distributions if any, collected
or
received by the Trustee with respect to Deposited
Securities. Such payments shall be made to or to the order of
Amalco by the Trustee as soon as practicable after the receipt of
such
dividends, interest or other distributions. In lieu of
receiving such dividends, interest or other distributions and paying
them
to Amalco or its designee, if Amalco so advises the Trustee in writing,
the Trustee shall instruct the Specialty TVCos in writing to pay
such
dividends or other distributions directly to Amalco or its
designee. In the event any such instruction is given to the
Specialty TVCos, all liability of the Trustee with regard to the
payment
of such dividends or other distributions shall cease, unless and
until
such instruction is revoked. The Trustee may at any time revoke
such instruction by written notice to the Specialty TVCos and direct
them
to make subsequent payments to the
Trustee;
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|
|
(b)
|
in
the event the Trustee receives any additional voting shares
of the Specialty TVCos through a dividend or other distribution
with respect to any Deposited Securities, the Trustee shall hold
such
shares subject to this Agreement as Deposited Securities for the
benefit
of Amalco or its designee and such shares shall become subject to
all of
the terms and conditions of this Agreement to the same extent as
if they
were Deposited Securities acquired by the Trustee pursuant to paragraph
2(a)
hereof;
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|
|
(c)
|
in
the event of the sale of all or substantially all of the assets of
the
Specialty TVCos, the dissolution or total or partial liquidation
of the
Specialty TVCos or the sale, exchange or transfer of all or part
of the
Deposited Securities, the Trustee shall receive the money, securities,
rights or property which are distributed or are distributable in
respect
thereof, or which are received in exchange therefor, and, after paying
(or
reserving for payment thereof) any expenses incurred pursuant to
this
Agreement, shall distribute such money, securities, rights or property
to
Amalco or its designee; and
|
|
|
(d)
|
if
at any time during the term of this Agreement, the Trustee shall
receive
or collect any money or other property through distribution by the
Specialty TVCos to its shareholders, other than as set forth in paragraphs
(a), (b)
or (c) of this Section 6, the
Trustee
shall distribute such money or other property to Amalco or its
designee.
|
|
8.
|
Commencement
of Voting Trust and
Termination
|
The
obligations of the parties hereunder shall commence immediately upon the
transfer and delivery of the Deposited Securities to the Trustee, and
shall
12
terminate
upon the delivery to Amalco or its designee of all of the Deposited Securities
or the sale thereof or of the assets of the Specialty TVCos that are required
to
be sold pursuant to a Request Sale Notice as contemplated hereunder and the
complete distribution of the proceeds to Amalco, except that the indemnity
obligations of Amalco and Amalco’s obligations to pay amounts owing to the
Trustee will continue in effect notwithstanding the termination of this
Agreement.
|
9.
|
Communications
|
|
|
(a)
|
On
a monthly basis, and otherwise when requested in writing by Amalco,
the
Trustee shall communicate with and provide reports to Amalco concerning
the business, maintenance and the operation of the Specialty
TVCos.
|
|
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(b)
|
Other
than as provided in paragraph 5(a), 9(a)
or elsewhere in this Agreement,
neither Amalco, GSCP, nor any of their respective officers, directors,
employees, shareholders or affiliates (other than the Specialty TVCos)
shall communicate with the Trustee regarding the operation or management
of the Specialty TVCos. Amalco may communicate with the Trustee
and/or officers, directors and employees of the Specialty TVCos concerning
any pre-existing contractual arrangements between Amalco and the
Specialty
TVCos, including the residual services agreement between New AABI
and
Amalco, the transfer of the Deposited Securities, other information
on the
procedures of implementing the Reorganization and other procedures
required to be taken by the Trustee or the Specialty TVCos pursuant
to the
terms hereof including, in the event of a Request Sale Notice or
Regulatory Disposition Notice, information that could assist the
Trustee
in his determination as to the manner in which the disposition of
any
shares or assets to be disposed of by him may be carried out so as
to
maximize the after-tax proceeds of such disposition to the ultimate
recipients thereof.
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|
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(c)
|
The
Trustee shall provide to Amalco or its counsel, copies of all written
materials sent to or received from the CRTC with respect to the
Reorganization and report orally to Amalco or its counsel on the
nature
and substance of all oral communications with the CRTC with respect
to the
Reorganization, all to be provided or reported on as soon as reasonably
possible.
|
|
|
(d)
|
Apart
from that specified in paragraph 9(c),
any notice, direction, request
or other instrument required or permitted to be given hereunder shall
be
in writing (including telecopier, telex, or any other means of
communication by which words are capable of being visibly reproduced
at a
distance point of reception) and given by delivering or sending it
by
telecopy or other similar means of communication
addressed:
|
13
|
|
(i)
|
if
to Amalco at:
|
000
Xxxxxxx Xxxxxx
00xx
Xxxxx
Xxxxxxxx,
Xxxxxxxx
X0X
0X0
Attention: Xxxxxxx
Xxxxxxx
Fax: (000)
000-0000
Copy
to
Osler, Xxxxxx & Harcourt LLP
One
First
Canadian Place
Box
50,
61st
Floor
Toronto,
Ontario
M5X
1B8
Attention: Xxxxx
Xxxxxxxx
Fax: (000)
000-0000
Copy
to
GS Capital Partners VI, L.P.
Xxx
Xxx Xxxx Xxxxx
00xx
Xxxxx
Xxx
Xxxx, Xxx Xxxx
Attention:
Xxx Xxxxx
Fax: (000)
000-0000
Copy
to
XxXxxxxx Xxxxxxxx XXX
Xxx
00,
Xxxxx 0000
Xxxxxxx-Xxxxxxxx
Bank Tower
Toronto,
Ontario
M5K
1E6
Attention: Xxxxx
Xxxxxx
Fax: (000)
000-0000
|
|
(ii)
|
if
to the Trustee at:
|
00
Xxxxxxxxxx Xxxxxxxx
Xxxxxxx,
Xxxxxxx
X0X
0X0
Attention: Xxxxx
X. Xxxxxxxxx
Fax: (000)
000-0000
Any
such
notice, direction or other instrument given as aforesaid shall be effective
upon
receipt, unless received on a day which is not a business
14
day
in
which event it shall be deemed to be received on the next business
day. 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.
|
10.
|
Miscellaneous
|
|
|
(a)
|
Except
for the written agreement between the Trustee and Amalco as to the
Trustee’s fees for so acting, this Agreement constitutes the entire
agreement between the parties hereto with respect to the subject
matter
hereof and supersedes all prior oral or written agreements, commitments
or
understandings with respect to the matters provided for
herein.
|
|
|
(b)
|
This
Agreement may be amended from time to time in any manner specified
in a
written notice given by Amalco to the Trustee to which is attached
copies
of an amending agreement executed by Amalco for such purpose; provided
that all necessary approvals, if any, to each such amendment shall
first
be obtained from the CRTC. If any such amendment affects in any
way any of the rights of the Trustee herein or increases the amount
of any
liability or potential liability of the Trustee hereunder as a result
of
acting pursuant hereto, the Trustee shall not be bound to agree to
any
such amendment. Subject to the foregoing, the Trustee shall
execute the copies of the amending agreement attached to the notice
and
return at least two (2) copies to
Amalco.
|
|
|
(c)
|
This
Agreement shall be binding upon and shall enure to the benefit of
the
parties hereto and their respective personal representatives, permitted
successors and permitted assigns. Subject to paragraph 6(h), this Agreement and the
trusts
hereof shall not be assignable by the
Trustee.
|
|
|
(d)
|
If
any part of any provision of this Agreement or any other agreement,
documents or writing given pursuant to or in connection with this
Agreement shall be invalid or unenforceable under applicable law,
said
part shall be ineffective to the extent of such invalidity only,
without
in any way affecting the remaining part of said provision or the
remaining
provisions of this Agreement.
|
|
|
(e)
|
This
Agreement, the rights and obligations of the parties hereto, and
any
claims and disputes relating thereto, shall be governed by and construed
exclusively in accordance with the laws of the Province of
Ontario.
|
|
|
(f)
|
This
Agreement may be executed in any number of counterparts, each of
which
shall be deemed to be an original and all of which together shall
be
deemed to be one and the same
Agreement.
|
|
|
(g)
|
The
Trustee shall comply based on Legal Advice with Public Notice CRTC
1999-196 and all rules, regulations and policies of the
CRTC.
|
15
|
|
(h)
|
The
parties agree and acknowledge that (i) Amalco has agreed to the
arrangements provided for in this Agreement pending the CRTC’s
consideration of the proposed acquisition by Amalco of the STVCo
Interests, (ii) by agreeing to these arrangements, Amalco is not
in any
way transferring, conveying, selling, assigning, hypothecating,
mortgaging, pledging, granting a security interest in, charging or
otherwise disposing, alienating or encumbrancing, or otherwise dealing
with in a similar manner, its beneficial interest in and to the Deposited
Securities or any shares or interests in any of the Regulated Entities
or
any shareholder or other agreement relating to any of the Regulated
Entities; nor is Amalco under any current unconditional agreement
or
commitment to take any such action, and (iii) the rights of the Trustee
under this agreement shall be subject to any existing shareholder
or other
agreement relating to the Specialty TVCos and any of the Regulated
Entities.
|
16
- -
|
|
IN
WITNESS WHEREOF the parties have executed this
Agreement.
|
|
CW
MEDIA INC.
|
|||
|
Per:
|
|||
|
Name:Xxxxxxx
Xxxxxxx
|
|||
|
Title:
Vice-President
|
|||
|
Per:
|
|||
|
Name:
Xxxx Xxxxxxx
|
|||
|
Title:
Secretary
|
|||
|
SIGNED,
SEALED AND DELIVERED in the presence of:
Witness
|
Xxxxx
X. Xxxxxxxxx
Trustee
|
17
SCHEDULE
A
Broadcasting
undertakings for which AABI has,
directly
or indirectly, been issued a license or authorization
Specialty
television undertakings wholly owned, directly or indirectly, by AABI (license
holder in parentheses).
History
Television (History Television Inc.)
Life
Network (Life Network Inc.)
Showcase
(Showcase Television Inc.)
Showcase
Action (Showcase Television Inc.)
Showcase
Diva (Showcase Television Inc.)
The
Independent Film Channel Canada (Showcase Television Inc.)
Specialty
television undertakings not wholly owned by AABI (license holder in
parentheses). 1 The
shares of each
license holder set out below will be transferred to SpecialtyWorks Holdco as
part of the Reorganization:
BBC
Canada (Jasper Broadcasting Inc.)
BBC
Kids
(Jasper Junior Broadcasting Inc.)
Discovery
Health Channel (Discovery Health Channel Canada ULC)
Fine
Living (HGTV Canada Inc.)
Food
Network Canada (Food Network Canada Inc.)
HGTV
Canada (HGTV Canada Inc.)
National
Geographic Channel (NGC Channel Inc.)2
ONE:
The
Body, Mind and Spirit Channel (One: The Body, Mind and Spirit Channel
Inc.)
Scream
(3924181 Canada Inc.)
Partnership
interests that will be held directly by Amalco following the Reorganization
(license holder in parentheses):
Historia
(AABI and Astral Broadcasting Inc., partners in general
partnership)
Séries+
(AABI and Astral Broadcasting Inc., partners in general
partnership)
Unlaunched
Services (authorization holder in parentheses)
D.I.Y.
Television (4399781 Canada Inc.)
Girls
TV
(Showcase Television Inc.)
ZTV
(Showcase Television Inc.)
Parent
TV
(Life Network Inc.)
Military
Television (History Television Inc.
18
CanWest
CanWest
Holdco
(4414616
Canada Inc.)
Luxco
Schedule
B
Post
Reorganization Structure
Jointco
(CW
Investments Co.)
33⅓%
voting
interest
66⅔%
voting
interest
Specialty
TV Holdco
(4414624
Canada Inc.)
Third
Party Debt
Specialty
TV Co
(CW
Media
Holdings Inc.)
Canco
(4414641
Canada Inc.)
CRTC-approved
Voting Trust Agreement
Amalco
(CW
Media
Inc.)
22.3%
Alliance
Atlantis Media Sales Amalco
6631363
Canada Inc.
Barney
Productions Holdings Inc.
Score
Media Inc.
4399781
Canada
Inc.
Life
Network
Inc.
Showcase
Television Amalco
(Showcase
Television Inc.)
History
Television Amalco
(History
Television Inc.)
Historia
Series +
SpecialtyWorks
Holdco
(4437471
Canada Inc.)
New
AABI
Amalco
(4437420
Canada Inc.)
50%
Subsidiaries
80%
Broadcast
Employees
NGC
Channel Inc.
Alliance
Atlantis Broadcasting Inc. Assets
Notes:
|
·
|
History
Television Holdco amalgamates with History Television Inc. to form
History
Television Amalco
|
|
·
|
Showcase
Television Holdco amalgamates with Showcase Television Inc. to
form
Showcase Television Amalco
|
|
·
|
New
AABI Holdco amalgamates with New AABI to form New AABI
Amalco
|
|
·
|
Alliance
Atlantis Media Sales Holdco amalgamates with Alliance Atlantis
Media Sales
Inc. to form Alliance Atlantis Media Sales
Amalco
|
19
SCHEDULE
C
RESTRICTED
MATERIAL AGREEMENTS
●
[LIST REDACTED*]
*
The material has
been omitted pursuant to a request for confidential treatment and the omitted
material has been filed separately with the U.S. Securities and Exchange
Commission.
20
