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EXHIBIT 10.54
(245)
SUPPORT AGREEMENT
MEMORANDUM OF AGREEMENT made as of the 17th day of December, 1998.
AMONG:
CUSTOMERONE HOLDING CORPORATION,
a corporation existing under the laws
of the State of Delaware,
(hereinafter referred to as "Holding"),
OF THE FIRST PART,
- and -
1293219 ONTARIO INC.,
a corporation existing under the laws
of the Province of Ontario,
(hereinafter referred to as "Onexco"),
OF THE SECOND PART,
- and -
1293220 ONTARIO INC.,
a corporation existing under the laws
of the Province of Ontario,
(hereinafter referred to as "Buyco").
OF THE THIRD PART.
WHEREAS the parties hereto desire to make appropriate
provision and to establish a procedure whereby Holding will take certain actions
and make certain payments and deliveries necessary to ensure that Buyco will be
able to make certain payments and to deliver or cause to be delivered Holding
Shares in satisfaction of the obligations of Holding under the provisions (the
"Exchangeable Share Provisions") attaching to the Non-Voting Exchangeable Shares
in a capital of Buyco (the "Exchangeable Shares") with respect to Liquidation
Amounts, Retraction Prices and Redemption Prices, all in accordance with the
Exchangeable Share Provisions;
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NOW THEREFORE in consideration of the respective covenants in
this Agreement and for other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the parties hereto hereby agree
as follows:
ARTICLE ONE
DEFINITIONS AND INTERPRETATION
1.1 DEFINED TERMS. In this Agreement including the recitals
hereto, all capitalized words and expressions used herein and not otherwise
defined herein shall have the meanings ascribed to such words and expressions in
the Exchangeable Share Provisions, unless the context requires otherwise.
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC. The division of
this Agreement into articles, sections and paragraphs and the insertion of
headings are for convenience of reference only and shall not affect the
construction or interpretation of this Agreement.
1.3 NUMBER, GENDER, ETC. In this Agreement, words importing the
singular number only shall include the plural and vice versa, words importing
the use of any gender shall include all genders.
1.4 DATE FOR ANY ACTION. If any date on which any action is
required to be taken under this Agreement is not a Business Day, such action
shall be required to be taken on the next succeeding Business Day.
ARTICLE TWO
COVENANTS OF HOLDING AND ONEXCO
2.1 COVENANTS OF HOLDING REGARDING EXCHANGEABLE SHARES. So long as
any Exchangeable Shares are outstanding, Holding shall:
(a) take all such actions and do all such things as are
commercially reasonable to enable and permit Buyco, in
accordance with applicable law, to pay and otherwise perform
its obligations with respect to the payment of dividends,
Section 8.3 of the Exchangeable Share Provisions and the
satisfaction of the Liquidation Amount, the Retraction Price
or the Redemption Price in respect of each issued and
outstanding Exchangeable Share upon the liquidation,
dissolution or winding-up of Buyco, the delivery of a
Retraction Request by a holder of Exchangeable Shares or a
redemption of Exchangeable Shares by Buyco, as the case may
be, including, without limitation, all such actions and all
such things as are necessary or desirable to enable and permit
Buyco to cause to be delivered Holding Shares together with an
amount equal to any declared and unpaid dividends on such
Exchangeable Shares (a "Dividend Amount")
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to the holders of Exchangeable Shares in accordance with
Articles 3, 4 or 5, as the case may be, of the Exchangeable
Share Provisions.
(b) take all such actions and do all such things as are reasonably
necessary or desirable to enable and permit Onexco to comply
with its covenants set out in Section 2.2 of this Agreement.
2.2 COVENANTS OF ONEXCO REGARDING EXCHANGEABLE SHARES. So long as
any Exchangeable Shares are outstanding, Onexco shall take all such actions and
do all such things as are commercially reasonable to enable and permit Buyco, in
accordance with applicable law, to pay and otherwise perform its obligations
with respect to the payment of dividends, Section 8.3 of the Exchangeable Share
Provisions and the satisfaction of the Liquidation Amount, the Retraction Price
or the Redemption Price in respect of each issued and outstanding Exchangeable
Share upon the liquidation, dissolution or winding-up of Buyco, the delivery of
a Retraction Request by a holder of Exchangeable Shares or a redemption of
Exchangeable Shares by Buyco, as the case may be, including, without limitation,
all such actions and all such things as are commercially reasonable to enable
and permit Buyco to cause to be delivered Holding Shares together with any
Dividend Amount, to the holders of Exchangeable Shares in accordance with the
provisions of Articles 3, 4 or 5, as the case may be, of the Exchangeable Share
Provisions. Notwithstanding the prior provisions, nothing contained in this
Support Agreement shall be deemed to require the board of directors of Holding,
or any member thereof, to take or omit to take any action that would be in
breach of applicable law. Furthermore, no action shall be required that could,
as determined in good faith by the board of directors of Holding, result in a
breach of the terms of any agreement in respect of indebtedness for borrowed
money of Holding on a consolidated basis, provided that Holding takes reasonable
steps to seek a waiver of any affected provision thereof. The existence of such
indebtedness shall be determined in accordance with United States generally
accepted accounting principles.
2.3 NOTIFICATION OF CERTAIN EVENTS. In order to assist Holding to
comply with its obligations hereunder and permit it to exercise the Liquidation
Call Right, the Retraction Call Right and the Redemption Call Right, Buyco shall
give prior written notice to Holding and Onexco of each of the following events
at the time set forth below:
(a) in the event of any determination by the Board of Directors of
Buyco to institute voluntary liquidation, dissolution or
winding up proceedings or to effect any other distribution of
the assets of such corporation among its shareholders for the
purpose of winding up its affairs, at least 30 days prior to
the proposed effective date of such liquidation, dissolution,
winding up or other distribution;
(b) immediately, upon the earlier of receipt by Buyco of notice
of, or Buyco otherwise becoming aware of, any threatened or
instituted claim, suit, petition or other proceedings with
respect to the involuntary liquidation, dissolution or winding
up of
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such company or to effect any other distribution of the assets
of such company among its shareholders for the purpose of
winding up its affairs;
(c) immediately, upon receipt by Buyco of a Retraction Request;
and
(d) on the same date on which notice of redemption is given to
holders of Exchangeable Shares, upon a determination of a
Redemption Date in accordance with the Exchangeable Share
Provisions.
2.4 DELIVERY OF HOLDING SHARES. In furtherance of its obligations
under Sections 2.1(a) and (b) hereof, upon notice of any event that requires
Buyco to cause to be delivered Holding Shares to any holder of Exchangeable
Shares, the board of directors of Holding, subject to fulfilment of its
fiduciary obligations, shall forthwith issue and deliver the requisite Holding
Shares to or to the order of the former holder of the surrendered Exchangeable
Shares, as Buyco or Onexco, as applicable, shall direct, and Holding shall
forthwith deliver to Onexco, and Onexco shall then immediately deliver to Buyco,
all cash or other property required to enable Buyco to pay the value of all
declared but unpaid dividends then accruing to the holders of the Dividend
Amount on such Exchangeable Shares. In consideration of the issuance of each
such Holding Share by Holding, together with the payment of such Dividend Amount
by Holding as applicable, Buyco or Onexco, as applicable, shall, as Holding
shall direct, issue to Holding such number of common shares of Buyco or Onexco,
as applicable, as is equal to the fair value of such Holding Shares plus the
Dividend Amount.
2.5 DUE PERFORMANCE. Holding shall duly and timely perform all of
its obligations provided for in the Share Exchange Agreement and any obligations
of Holding that may arise upon the exercise of Holding's rights under the
Exchangeable Share Provisions.
2.6 CAPITAL REORGANIZATION OF HOLDING. If at any time Holding's
share capital is reorganized or a consolidation, merger, recapitalization or
share exchange (statutory or otherwise) of Holding with or into another entity
(any such event being called a "Capital Reorganization"), Holding shall take
commercially reasonable actions to ensure that holders of Exchangeable Shares
whose Exchangeable Shares have not been exchanged or automatically exchanged for
Holding Shares in accordance with the Exchangeable Share Provisions or the Share
Exchange Agreement on or before the record date for such Capital Reorganization
shall receive, upon any such exchange occurring pursuant to the Exchangeable
Share Provisions or the Share Exchange Agreement at any time after the record
date for such Capital Reorganization, in lieu of the Holding Shares that such
holders would otherwise have been entitled to receive pursuant to the
Exchangeable Share Provisions or the Share Exchange Agreement, the number of
shares or other securities of Holding or of the body corporate resulting,
surviving or continuing from the Capital Reorganization, or other property, that
such holders would have been entitled to receive as a result of such Capital
Reorganization if, on the record date, such holders would have been the
registered holders of the number of Holding Shares to which such holders were
then entitled upon any exchange of their Exchangeable Shares into Holding Shares
in accordance with the Exchangeable Share Provisions or the Share Exchange
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Agreement, subject to adjustment thereafter in the same manner, as nearly as may
be possible, as is provided for in Article 8 of the Exchangeable Share
Provisions.
ARTICLE THREE
GENERAL
3.1 TERM. This Agreement shall come into force and be effective as
of the date hereof and shall terminate and be of no further force and effect at
such time as there are no Exchangeable Shares (or securities or rights
convertible into or exchangeable for or carrying rights to acquire Exchangeable
Shares) held by any party other than Holding and its Affiliates.
3.2 CHANGES IN CAPITAL OF HOLDING AND BUYCO. Notwithstanding the
provisions of Section 3.4 hereof, at all times after the occurrence of any event
effected pursuant to Section 2.6 hereof, as a result of which either Holding
Shares or the Exchangeable Shares or both are in any way changed, this Agreement
shall forthwith to the extent practicable be amended and modified as necessary
in order that it shall apply with full force and effect to all new securities
into which Holding Shares or the Exchangeable Shares or both are so changed and
the parties hereto shall execute and deliver an agreement in writing giving
effect to and evidencing such necessary amendments and modifications.
3.3 SEVERABILITY. If any provision of this Agreement is held to be
invalid, illegal or unenforceable, the validity, legality or enforceability of
the remainder of this Agreement shall not in any way be affected or impaired
thereby and this Agreement shall be carried out as nearly as possible in
accordance with its original terms and conditions.
3.4 AMENDMENTS, MODIFICATIONS, ETC. This Agreement may not be
amended or modified except by an agreement in writing executed by Buyco, Holding
and Onexco and approved by the holders of the Exchangeable Shares in accordance
with Article 7 of the Exchangeable Share Provisions.
3.5 MINISTERIAL AMENDMENTS. Notwithstanding the provisions of
Section 3.4, the parties to this Agreement may without the approval of the
holders of the Exchangeable Shares, at any time and from time to time, amend or
modify this Agreement in writing for the purposes of:
(a) adding to the covenants of either or both parties for the
protection of the holders of the Exchangeable Shares;
(b) making such amendments or modifications not inconsistent with
this Agreement as may be necessary or desirable with respect
to matters or questions which, in the opinion of the board of
directors of each of Buyco, Holding and Onexco, it may be
expedient to make, provided that each such board of directors
shall be of the opinion
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that such amendments or modifications will not be prejudicial
to the interests of the holders of the Exchangeable Shares; or
(c) making such changes or corrections which, on the advice of
counsel to Buyco, Holding and Onexco, are required for the
purpose of curing or correcting any ambiguity or defect or
inconsistent provision or clerical omission or mistake or
manifest error herein, provided that the boards of directors
of each of Buyco, Holding and Onexco shall be of the opinion
that such changes or corrections will not be prejudicial to
the interests of the holders of the Exchangeable Shares.
3.6 MEETING TO CONSIDER AMENDMENTS. Buyco, at the request of
Holding, shall call a meeting or meetings of the holders of the Exchangeable
Shares for the purpose of considering any proposed amendment or modification
requiring approval pursuant to Section 3.4 hereof. Any such meeting or meetings
shall be called and held in accordance with the by-laws of Buyco and the
Exchangeable Share Provisions. In lieu of calling a meeting of holders of
Exchangeable Shares, with the consent of Holding, any proposed amendment or
modification requiring approval of the holders of Exchangeable Shares pursuant
to Section 3.4 hereof may be given by such holders executing a written
resolution evidencing the approval of such proposed amendment or modification,
which resolution must be signed by all the holders of Exchangeable Shares
entitled to vote on such matter.
3.7 WAIVERS. No waiver of any of the provisions of this Agreement
otherwise permitted hereunder shall be effective unless made in writing and
signed by all the parties hereto.
3.8 BINDING AGREEMENT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
3.9 NOTICES TO PARTIES. All notices and other communications
between the parties shall be in writing and shall be deemed to have been given
if delivered personally or by confirmed fax to the parties at the following
addresses (or at such other address for either such party as shall be specified
in like notice):
(a) if to Holding at:
CustomerONE Holding Corporation
c/o Onex Investment Corp.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
00000
Attention: Xxxx Xxxxx
(b) with a copy to:
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Weil, Gotshal & Xxxxxx LLP
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxx
00000-0000
Attention: Xxxx Xxxxx
(c) if to Onexco or Buyco at:
Xxxx Xxxxxxxxxxx
XXX Xxxxx
Xxxxxx Trust Xxxxx Xxxxx
000 Xxx Xxxxxx
49th Floor, P.O. Box 700
Toronto, Ontario
M5J 2S1
Attention: Xxxx X. Xxxxxx
Fax: (000) 000-0000
Any notice or other communication given personally shall be deemed to have been
given and received upon delivery thereof and if given by telecopy shall be
deemed to have been given and received on the date of confirmed receipt thereof
unless such day is not a Business Day or unless such notice or communication was
not given during the normal business hours of the recipient on such day, in
which case it shall be deemed to have been given and received upon the
immediately following Business Day.
3.10 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original, and all of which taken together shall
constitute one and the same instrument.
3.11 JURISDICTION. This Agreement shall be governed by, construed
and enforced in accordance with the laws of the Province of Ontario and the
federal laws of Canada applicable in that
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province and the parties hereto hereby irrevocably attorn to the non-exclusive
jurisdiction of the courts of the Province of Ontario and all courts competent
to hear appeals therefrom.
IN WITNESS WHEREOF the parties have executed this Agreement as
of the date first above written.
CUSTOMERONE HOLDING
CORPORATION
by /s/ XXXXXX X. XXX
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/s/ XXXX X. XXXXXX
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1293219 ONTARIO INC.
by /s/ XXXXXX X. XXX
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/s/ XXXX X. MERKSKY
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1293220 ONTARIO INC.
by /s/ XXXXXX X. XXX
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/s/ XXXX X. XXXXXX
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