SUPPORT AGREEMENT
AMONG
ADVANCED COMMUNICATIONS GROUP, INC.
AND
ACG HOLDING COMPANY
AND
ACG EXCHANGE COMPANY
AND
1 + USA V ACQUISITION CORP.
AND
CERTAIN HOLDERS OF THE COMPANY
SHARES AS LISTED IN SCHEDULE A
AND
YPTEL/ACG PLEDGE CORPORATION
FEBRUARY 21, 2000
INDEX
ARTICLE I DEFINITIONS AND INTERPRETATION..................................... 2
1.1 DEFINED TERMS......................................................... 2
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS............................... 2
1.3 NUMBER, GENDER........................................................ 2
1.4 DATE FOR ANY ACTION................................................... 2
ARTICLE II COVENANTS OF PARENT, NEWCO I, USA V AND NEWCO II................... 3
2.1 COVENANTS OF PARENT, NEWCO I, USA V AND NEWCO II
REGARDING EXCHANGEABLE SHARES......................................... 3
2.2 SEGREGATION OF FUNDS.................................................. 4
2.3 RESERVATION OF SHARES OF PARENT COMMON STOCK.......................... 5
2.4 NOTIFICATION OF CERTAIN EVENTS........................................ 5
2.5 DELIVERY OF SHARES OF PARENT COMMON STOCK............................. 5
2.6 QUALIFICATION OF SHARES OF PARENT COMMON STOCK........................ 6
2.7 ECONOMIC EQUIVALENCE.................................................. 7
2.8 SALE OF PARENT........................................................ 10
2.9 OWNERSHIP OF OUTSTANDING SHARES OF NEWCO I, USA V AND NEWCO II........ 13
2.10 PARENT AND SUBSIDIARIES NOT TO VOTE EXCHANGEABLE SHARES.............. 13
2.11 RULE 10B-18 PURCHASES................................................. 14
ARTICLE III CERTAIN RESTRICTIONS.............................................. 14
3.1 NEWCO I RESTRICTIONS.................................................. 14
3.2 NEWCO II RESTRICTIONS................................................. 15
3.3 PARENT SUCCESSOR OR PURCHASER......................................... 15
ARTICLE IV GENERAL............................................................ 16
4.1 TERM.................................................................. 16
4.2 SEVERABILITY.......................................................... 16
4.3 AMENDMENTS, MODIFICATIONS, ETC........................................ 16
4.4 MINISTERIAL AMENDMENTS................................................ 16
4.5 MEETING TO CONSIDER AMENDMENTS........................................ 17
4.6 ENUREMENT............................................................. 17
4.7 NOTICE................................................................ 17
4.8 COUNTERPARTS.......................................................... 19
4.9 JURISDICTION.......................................................... 19
4.10 ATTORNMENT............................................................ 19
4.11 CONSTRUCTION.......................................................... 20
4.12 EXCHANGEABLE SHARE PROVISIONS......................................... 20
4.13 EFFECTIVENESS OF AGREEMENT............................................ 20
SUPPORT AGREEMENT
THIS SUPPORT AGREEMENT is entered into as of February 21, 2000, by
and among Advanced Communications Group, Inc., a corporation existing under
the laws of Delaware ("PARENT"), ACG Holding Company, a Nova Scotia unlimited
liability company and wholly owned subsidiary of Parent ("NEWCO I"), ACG
Exchange Company, a Nova Scotia limited liability company and a subsidiary of
Newco I ("NEWCO II"), 1 + USA V Acquisition Corp., a Delaware corporation and
a wholly owned subsidiary of Parent and a shareholder of Newco II ("USA V"),
certain holders of shares of Company (defined below) as set out in Schedule A
hereto, and YPtel/ACG Pledge Corporation, an Ontario corporation.
WHEREAS, pursuant to an Agreement made as of June 3, 1999, as
amended and restated October 26, 1999 (as the same may be further amended
from time to time, the "YPTEL AGREEMENT"), by and among Parent, The Company,
a corporation then incorporated under the laws of Canada, continued under the
laws of Nova Scotia as YPtel Limited, to be amalgamated with a Nova Scotia
unlimited liability company prior to the Closing Date (as defined in the
YPtel Agreement) thus becoming a Nova Scotia unlimited liability company
which will become a subsidiary of Newco II on the Closing Date (the
"COMPANY"), the shareholders of the Company listed on Exhibit "A" attached
thereto, Cold Trust, Global Investment Trust, Freezer Trust, Storage Trust,
Directory Trust, Publisher Trust (collectively the "BARBADIAN TRUSTS"), The
J.L.R. Family Trust, The Paisley Family Trust, Xxxxxx Xxxxxx, and Xxxxxxx X.
XxXxxxxx (collectively the "ICL PRINCIPALS") and Imperial Capital Limited, a
corporation incorporated under the laws of Ontario, the parties agreed that
on the Closing Date the parties hereto would execute and deliver the within
Support Agreement;
WHEREAS, pursuant to the YPtel Agreement, the shareholders of the
Company who are parties hereto will exchange certain of the issued and
outstanding common shares of the Company owned by them for all the initially
issued and outstanding Class A Special Shares of Newco II (the "CLASS A
SPECIAL SHARES");
WHEREAS, Appendix A to the Articles of Association of Newco II, as
amended, sets forth the rights, privileges, restrictions and conditions
attaching to the Class A Special Shares (as the same may be amended from time
to time, the "EXCHANGEABLE SHARE PROVISIONS");
WHEREAS, the parties hereto desire to make appropriate provision and
to establish a procedure whereby Parent, Newco I, Newco II and USA V will
take certain actions and make certain payments and deliveries necessary to
ensure that Newco I, Newco II or Parent will be able to make certain payments
and to deliver or cause to be delivered shares of common stock of Parent, par
value US$0.0001 per share ("PARENT COMMON STOCK") in satisfaction of the
obligations of Newco II with respect to the payment and satisfaction of
dividends, Liquidation Consideration, Retraction Prices, Exchangeable Share
Consideration and Redemption Prices, all in accordance with the Exchangeable
Share Provisions and the provisions of the Exchange and Voting Trust
Agreement
- 2 -
between Newco I, Newco II, Parent, USA V, the holders of Exchangeable Shares
and the trustee named therein, dated as of February 21, 2000 (as the same may
be amended from time to time, the "EXCHANGE AND VOTING TRUST AGREEMENT"); and
WHEREAS, shortly after this Agreement becomes effective, Newco II
will amalgamate (the "NEWCO II AMALGAMATION") with various subsidiaries of
Newco II (other than the Company), and all the holders of common stock or of
Class A Special Shares of Newco II immediately prior to the amalgamation will
become all the holders of similar common shares and Class A Special Shares of
the amalgamated entity, which entity will also be named ACG Exchange Company
and be a Nova Scotia unlimited liability company (the "AMALGAMATED NEWCO II"
or "NEWCO II"), so that all references to Newco II herein shall refer to the
Newco II then existing and all references to the Class A Special Shares shall
refer to the Class A Special Shares of the Newco II then existing.
NOW, THEREFORE, in consideration of the respective covenants and
agreements provided in this Agreement and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the parties agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
1.1 DEFINED TERMS. Each term denoted herein by initial capital letters
and not otherwise defined herein shall have the meaning attributed thereto in
the Exchangeable Share Provisions or the Exchange and Voting Trust Agreement,
as applicable, unless the context otherwise requires.
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS. 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. Unless otherwise indicated,
all references to an "ARTICLE" OR "SECTION" followed by a number and/or a
letter refer to the specified Article or Section of this Agreement. The terms
"THIS AGREEMENT", "HEREOF ", "HEREIN" and "HEREUNDER" and similar expressions
refer to this Agreement and not to any particular Article, Section or other
portion hereof and include any agreement or instrument supplementary or
ancillary hereto.
1.3 NUMBER AND GENDER. 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. For the purposes of
this Agreement, a "BUSINESS DAY" means any day on which commercial banks are
open for business in St. Louis, Missouri and Xxxxxxx, Xxxxxxx, other than a
- 3 -
Saturday, a Sunday or a day observed as a holiday in Toronto, Ontario under
the laws of the Province of Ontario or the federal laws of Canada or in St.
Louis, Missouri under the laws of the State of Missouri or the federal laws
of the United States of America.
ARTICLE II
COVENANTS OF PARENT, NEWCO I, USA V AND NEWCO II
2.1 COVENANTS OF PARENT, NEWCO I, USA V AND NEWCO II REGARDING
EXCHANGEABLE SHARES. So long as any Exchangeable Shares held by a Holder are
outstanding:
(a) Parent will not declare or pay any dividend on Parent Common Stock
unless (i) Newco II will have sufficient assets, funds and other
property available (including but not limited to authorized but
unissued securities available) to enable the due declaration and
the due and punctual payment in accordance with applicable law of
a dividend on the Exchangeable Shares in accordance with Article 3
of the Exchangeable Share Provisions and (ii) Subsection 2.1(b)
shall be complied with in connection with such dividend;
(b) Parent, Newco I, USA V and Newco II will cause Newco II to declare
simultaneously with the declaration of any dividend on Parent
Common Stock a dividend on the Exchangeable Shares and, when such
dividend is paid on Parent Common Stock, cause Newco II to pay
simultaneously therewith such dividend on the Exchangeable Shares,
in each case in accordance with Article 3 of the Exchangeable
Share Provisions;
(c) Parent will advise Newco I and Newco II sufficiently in advance of
the declaration by Parent of any dividend on Parent Common Stock
and take all such other actions as are necessary, in cooperation
with Newco II, to ensure that the respective record date and
payment date for a dividend on the Exchangeable Shares shall be
the same as the record date and payment date for the corresponding
dividend on Parent Common Stock and that such dividend on the
Exchangeable Shares will correspond with any requirement of the
principal stock exchange on which Parent Common Stock or the
Exchangeable Shares are listed;
(d) Parent will ensure that the record date for any dividend declared
on Parent Common Stock is not less than ten Business Days after
the declaration date for such dividend;
(e) Subject to the exercise by Newco I of the Liquidation Call Right,
Redemption Call Right or Retraction Call Right pursuant to the
Exchange and Voting Trust Agreement, Parent, Newco I, USA V and
Newco II will, in accordance with applicable law, take all such
actions and do all such things as are necessary or desirable
to
- 4 -
enable and permit Newco II, in accordance with applicable law, to
pay and otherwise perform its obligations with respect to the
satisfaction of the Liquidation Consideration or the Retraction
Price in respect of each issued and outstanding Exchangeable Share
upon the liquidation, dissolution or winding-up of Newco II or
the delivery of a Retraction Request by a holder of Exchangeable
Shares, as the case may be, including, without limitation, all
such actions and all such things as are necessary or desirable to
enable and permit Newco II to cause to be delivered Exchangeable
Share Consideration to the holders of Exchangeable Shares in
accordance with the provisions of Article 5, 6 or 7, as the case
may be, of the Exchangeable Share Provisions; and
(f) Parent, Newco I, USA V and Newco II will take all such actions
and do all such things as are necessary or desirable to enable
and permit Parent, Newco I, USA V or Newco II, as the case may
be, in accordance with applicable law, to perform their
obligations, as the case may be, pursuant to the Exchangeable
Share Provisions and the Exchange and Voting Trust Agreement,
including but not limited to, arising upon or from (i) the
exercise by Newco I of its Retraction Call Right, Liquidation
Call Right or Redemption Call Right pursuant to the Exchange and
Voting Trust Agreement; (ii) the exercise by a Holder of
Exchangeable Shares of such Holder's Exchange Put Right or
Exchange Right pursuant to the Exchangeable Share Provisions or
the Exchange and Voting Trust Agreement; (iii) the automatic
exchange of a Holder's Exchangeable Shares in accordance with
the rights set forth in Section 5.13 of the Exchange and
Voting Trust Agreement (the "AUTOMATIC EXCHANGE Rights"); or
(iv) the provisions of the Exchangeable Share Provisions,
including, without limitation, all such actions and all such
things as are necessary or desirable to enable and permit Parent,
Newco I or Newco II to cause Exchangeable Share Consideration to
be delivered to the holders of Exchangeable Shares in accordance
with the Exchangeable Share Provisions and the Exchange and Voting
Trust Agreement.
2.2 SEGREGATION OF FUNDS. Parent will cause Newco II to deposit a
sufficient amount of funds in a separate account, in trust, and segregate a
sufficient amount of such assets and other property, in trust, as is
necessary to enable Newco II to pay or otherwise satisfy the applicable
dividends, and if Parent has notice of a Liquidation Event or a Retraction
Request and if Newco I has not exercised or will not exercise its Liquidation
Call Right or Retraction Call Right with respect thereto, the Liquidation
Consideration or Retraction Price, as applicable, in each case for the
benefit of Holders from time to time of the Exchangeable Shares, and subject
to applicable law Newco II will use such funds, assets and other property so
segregated exclusively for the payment of dividends and the payment or other
satisfaction of the Liquidation Consideration or the Retraction Price, as
applicable, net of any corresponding withholding tax obligations and for the
remittance of such withholding tax obligations.
- 5 -
2.3 RESERVATION OF SHARES OF PARENT COMMON STOCK. Parent hereby
represents, warrants and covenants that it has irrevocably reserved for
issuance and will at all times keep available, free from pre-emptive and
other rights, out of its authorized and unissued capital stock such number of
shares of Parent Common Stock (or other shares or securities into which
Parent Common Stock may be reclassified or changed as contemplated by Section
2.7 hereof) (a) as is equal to the number of shares of Parent Common Stock
for which the Exchangeable Shares issued and outstanding from time to time
and held by the Holders are exchangeable, and (b) as are now and may
hereafter be required to enable and permit Parent to meet its obligations
hereunder with respect to the Exchangeable Share Provisions and the Exchange
and Voting Trust Agreement and under any other security or commitment
pursuant to which Parent may now or hereafter be required to issue Parent
Common Stock, to enable and permit Newco II to meet its respective
obligations or exercise its rights hereunder, under the Exchange and Voting
Trust Agreement and the Exchangeable Share Provisions.
2.4 NOTIFICATION OF CERTAIN EVENTS. In order to assist Parent to
comply with its obligations hereunder and under the Exchange and Voting Trust
Agreement, Newco II will give or cause the Transfer Agent so acting to give
Parent notice of each of the following events at the time set forth below:
(i) immediately, in the event of any determination by the Board of
Directors of Newco II to take any action which would require a
vote or consent of the Holders of Exchangeable Shares for
approval; and
(ii) immediately, upon the earlier of (A) receipt by Newco II (directly
or from Newco I) of notice of, and (B) Newco II 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 Newco II or to effect any other
distribution of the assets of Newco II among its shareholders for
the purpose of winding-up its affairs.
At least 30 days prior to any Automatic Redemption Date as determined by the
Board of Directors of Parent pursuant to the definition of Automatic
Redemption Date in the Exchange and Voting Trust Agreement, Parent shall
notify Newco II of an Automatic Redemption Date or possible Automatic
Redemption Date, as applicable. At least sixty (60) days prior to a
Redemption Date set by Newco II or Parent in accordance with the definition
of Redemption Date in the Exchangeable Share Provisions, the entity setting
the Redemption Date shall notify the other, whether Newco II or Parent, of
the applicable Redemption Date.
2.5 DELIVERY OF SHARES OF PARENT COMMON STOCK. In furtherance of its
obligations hereunder, upon notice from Newco II of any event which requires
Newco II to cause to be delivered shares of Parent Common Stock to any Holder
of Exchangeable Shares, Parent shall forthwith contribute to the capital of
Newco I in a 99% share and to the capital of USA V in a 1% share and cause
- 6 -
Newco I and USA V to contribute to the capital of Newco II, or Parent shall
otherwise deliver or cause to be delivered to Newco II (directly or from
Newco I and USA V) the requisite shares of Parent Common Stock to be received
by, and issued to the order of, the former Holder of the surrendered
Exchangeable Shares, as Newco II shall direct. All such shares of Parent
Common Stock shall be duly issued as fully paid and non-assessable. Unless
Parent shall otherwise direct, in consideration of the issuance and delivery
of each such share of Parent Common Stock, Newco II shall issue to each of
Newco I and USA V, Common Shares of Newco II, and Newco I and USA V shall, in
turn, issue to Parent common shares of Newco I and USA V, respectively,
having substantially equivalent value to the Parent Common Stock so
contributed (such equivalence to be determined by Parent and Newco II from
time to time). Upon notice from Newco I of any event which requires Newco I
to cause to be delivered shares of Parent Common Stock to any Holder of
Exchangeable Shares, Parent shall similarly contribute to Newco I or
otherwise deliver to Newco I the requisite shares of Parent Common Stock to
be received by, and issued to the order of, the former Holder of the
surrendered Exchangeable Shares, as Newco I shall direct. The shares of
Parent Common Stock for the former Holders may be delivered directly to the
Transfer Agent (unless Newco II, USA V or Newco I, as applicable otherwise
directs) for delivery to such Holders. Notwithstanding the foregoing
provisions of this Section 2.5, in any case where a former Holder of
surrendered Exchangeable Shares is entitled to shares of Parent Common Stock
under the Exchangeable Share Provisions, the Exchange and Voting Trust
Agreement or this Agreement, Parent shall ensure that such shares of Parent
Common Stock are delivered to such Holder or as such Holder shall have
directed.
2.6 QUALIFICATION OF SHARES OF PARENT COMMON STOCK. If any shares of
Parent Common Stock (or other shares or securities into which Parent Common
Stock may be reclassified or changed as contemplated by Section 2.7 hereof)
to be issued or delivered hereunder require registration or qualification
with or approval of or the filing of any document including any prospectus or
similar document, the taking of any proceeding with or the obtaining of any
order, ruling or consent from any governmental or regulatory authority under
any Canadian or United States federal, provincial or state law or regulation
or pursuant to the rules and regulations of any regulatory authority, or the
fulfillment of any other legal requirement (collectively the "APPLICABLE
LAWS") before such shares (or such other shares or securities) may be issued
by Parent or delivered by Parent, Newco I or Newco II to the Holder of
surrendered Exchangeable Shares or in order that such shares (or such other
shares or securities) may be freely traded thereafter, Parent will in good
faith expeditiously take all such actions and do all such things as are
necessary to register, qualify or obtain required approvals for the resale by
such holders of such shares of Parent Common Stock. Parent will in good faith
take all actions and do all things as are reasonably necessary or desirable
under Applicable Laws as they exist at the relevant time to cause the shares
of Parent Common Stock (and such other shares or securities) to be issued or
delivered hereunder to be freely tradable thereafter, provided the first
trade of Parent Common Stock is required to be executed through the
facilities of a stock exchange or market outside of Canada
- 7 -
(such as the New York Stock Exchange). Parent will in good faith
expeditiously take all such actions and do all such things as are necessary
to cause all shares of Parent Common Stock (or such other shares or
securities) to be delivered hereunder to be listed, quoted or posted for
trading on all stock exchanges and quotation systems on which outstanding
shares of Parent Common Stock (or such other shares or securities) are
listed, quoted or posted for trading at such time.
2.7 ECONOMIC EQUIVALENCE.
(a) Parent will not, without the prior approval of the Holders of the
Exchangeable Shares given in accordance with Article 10 of the Exchangeable
Share Provisions:
(i) issue or distribute shares of Parent Common Stock (or securities
exchangeable for or convertible into or carrying rights to acquire
shares of Parent Common Stock) to the holders of all or
substantially all of the then outstanding shares of Parent Common
Stock by way of stock dividend or other distribution; or
(ii) issue or distribute rights, options or warrants to the holders of
all or substantially all of the then outstanding shares of Parent
Common Stock entitling them to subscribe for or to purchase shares
of Parent Common Stock (or securities exchangeable for or
convertible into or carrying rights to acquire shares of Parent
Common Stock); or
(iii) issue or distribute to the holders of all or substantially all of
the then outstanding shares of Parent Common Stock (A) shares or
securities of Parent of any class other than Parent Common Stock
(other than shares convertible into or exchangeable for or
carrying rights to acquire shares of Parent Common Stock), (B)
rights, options or warrants other than those referred to in
Subsection 2.7(a)(ii) above, (C) evidences of indebtedness of
Parent or (D) assets of Parent;
unless one or both of Newco II and Parent is permitted under applicable law
to issue and distribute the economic equivalent on a per share basis of such
rights, options, warrants, securities, shares, evidences of indebtedness or
assets to Holders of the Exchangeable Shares and the economic equivalent
(determined on the basis of the number of shares of Parent Common Stock for
which the Exchangeable Shares then issued and outstanding and held by Holders
are exchangeable) of the items referred to in Subsections 2.7(a)(i), (ii) and
(iii) above, as applicable, is simultaneously issued or distributed to the
Holders of the Exchangeable Shares.
This Subsection 2.7(a) shall not apply to or restrict the issuance or
distribution of any of the foregoing items that are not part of an issuance
or distribution to be made available to all or substantially all of the
holders of
- 8 -
outstanding Parent Common Stock in their capacity as such shareholders. By
way of example, but not limitation, the following are not restricted
hereunder, (a) the issuance or granting by Parent of stock options,
restricted stock, "SARS" or other securities to employees or directors of
Parent or any of its subsidiaries under a current or future employee
incentive plan or other plan not made available to all or substantially all
of the holders of outstanding Parent Common Stock, and (b) the issuance of
convertible securities (including, without limitation, notes and warrants)
unless issued or offered to all or substantially all of the holders of Parent
Common Stock. This Subsection 2.7(a) shall not apply to or restrict the
issuance or distribution of shares of Parent Common Stock or other securities
to the holders of rights, options, warrants, convertible securities or
evidences of indebtedness now outstanding or which are hereafter issued
without violation of this Subsection 2.7(a).
(b) Parent will not, without the prior approval of the Holders of the
Exchangeable Shares given in accordance with Article 10 of the Exchangeable
Share Provisions:
(i) subdivide, redivide or change the then outstanding shares of
Parent Common Stock into a greater number of shares of Parent
Common Stock; or
(ii) reduce, combine or consolidate or change the then outstanding
shares of Parent Common Stock into a lesser number of shares of
Parent Common Stock, or
(iii) reclassify or otherwise change the shares of Parent Common Stock
or effect an amalgamation, merger, reorganization or other
transaction affecting the shares of Parent Common Stock;
unless Newco II is permitted under applicable law to make the same or an
economically equivalent change to, or in the rights of holders of, the
Exchangeable Shares on a tax deferred basis if the change to the Parent
Common Stock is not a taxable event generally to the holders of Parent Common
Stock generally and the same or an economically equivalent change is
simultaneously made to, or in the rights of, the Holders of the Exchangeable
Shares.
(c) Parent will ensure that the record date for both Parent and Newco
II for any event referred to in Subsection 2.7 (a) or 2.7 (b) above, or (if
no record date is applicable for such event) the effective date for any such
event, is not less than 10 Business Days after the date on which such event
is declared or announced by Parent (with simultaneous notice thereof to be
given by Parent to Newco II).
(d) Newco II agrees that, to the extent required, upon due notice from
Parent, Newco II will take or cause to be taken such steps as may be
necessary in accordance with applicable law for the purposes of ensuring that
appropriate dividends are paid or other distributions are made by Newco II,
or subdivisions,
- 9 -
redivisions or changes are made to the Exchangeable Shares, in order to
implement the required economic equivalence with respect to the Parent Common
Stock and Exchangeable Shares as provided for in this Section 2.7.
(e) The board of directors of Parent ("PARENT BOARD OF DIRECTORS")
shall determine, in good faith and in its sole discretion, economic
equivalence for the purposes of any event referred to in Section 2.7(a) or
2.7(b) above. With respect to situations in which the item distributed is
nontaxable generally to holders of Parent Common Stock but is taxable to
Holders of Exchangeable Shares, the lack of tax deferral shall be valued by
the Parent Board of Directors as provided in Section 2.8(j) below. In making
its determinations of economic equivalence, the following factors shall,
without excluding other factors determined by the Parent Board of Directors
to be relevant, be considered by the Parent Board of Directors:
(i) in the case of any stock dividend or other distribution payable in
Parent Common Stock, the number of such shares issued in
proportion to the number of shares of Parent Common Stock
previously outstanding;
(ii) in the case of the issuance or distribution of any rights, options
or warrants to subscribe for or purchase Parent Common Stock (or
securities exchangeable for or convertible into or carrying rights
to acquire Parent Common Stock), the relationship between the
exercise price of each such right, option or warrant and the
current market value (as determined by the boards of directors of
Newco II and Parent in the manner contemplated below) of a share
of Parent Common Stock;
(iii) in the case of the issuance or distribution of any other form of
property (including without limitation any shares or securities of
Parent of any class other than Parent Common Stock, any rights,
options or warrants other than those referred to in Subsection 2.7
(e)(ii) above, any evidences of indebtedness of Parent or any
assets of Parent), the relationship between the fair market value
(as determined by the Parent Board of Directors in the manner
contemplated below) of such property to be issued or distributed
with respect to each outstanding share of Parent Common Stock and
the current market value (as determined by the Parent Board of
Directors in the manner contemplated below) of a share of Parent
Common Stock;
(iv) in the case of any subdivision, redivision or change of the then
outstanding shares of Parent Common Stock into a greater number of
shares of Parent Common Stock or the reduction, combination,
consolidation or change of the then outstanding shares of Parent
Common Stock into a lesser number of shares of Parent Common Stock
or any amalgamation, merger, reorganization or other
- 10 -
transaction affecting Parent Common Stock, the effect thereof upon
the then outstanding shares of Parent Common Stock;
(v) in all such cases, the general taxation consequences of the
relevant event to Holders of Exchangeable Shares to the extent
that such consequences may differ from the taxation consequences
to holders of Parent Common Stock as a result of differences
between taxation laws of Canada and the United States (except for
any differing consequences arising as a result of differing
marginal taxation rates and without regard to the individual
circumstances of holders of Exchangeable Shares); and
(vi) in all such cases, the five (5) year deferral of tax available to
the Holders of Exchangeable Shares measured from the date of their
first issue.
For purposes of the foregoing determinations, the current market value of any
security listed and traded or quoted on a securities exchange shall be the
weighted average of the daily closing prices of such security during a period
of not less than 20 consecutive trading days ending not more than three
trading days before the date of determination on the principal securities
exchange on which such securities are listed and traded or quoted.
(f) In the event of a Liquidation Event, Section 5.13 of the Exchange
and Voting Trust Agreement shall be applicable and this Section 2.7 shall not
be applicable except to confirm the right of the holders of Parent Common
Stock received upon such exchange of Exchangeable Shares to participate in
the applicable Liquidation Event in the same manner as other holders of
Parent Common Stock.
(g) In the event the item to be distributed pursuant to this Section
2.7 is not readily marketable, reference shall be made to Section 2.8(i)
to the extent applicable.
2.8 SALE OF PARENT.
(a) In the event of a proposed transaction involving the sale of
Parent (whether by shareholder sale of stock, sale of all or substantially
all of its assets or by other means) which the Parent Board of Directors
desires to pursue or recommend (the "Proposed Sale"), the following
provisions shall apply.
(b) If the Proposed Sale involves the receipt by shareholders of
Parent of all cash, Parent shall ensure that the Holders of Exchangeable
Shares will be able to receive the same per share cash consideration as the
holders of Parent Common Stock and at the same time as the holders of Parent
Common Stock.
(c) If the consideration receivable by holders of Parent Common Stock
is property other than cash or partly cash and partly property other than
cash, then to the EXTENT that such non-cash consideration will be non-taxable
to such holders GENERALLY, Parent will use its best efforts to take all such
actions and do
- 11 -
all such things as are necessary or desirable to enable and permit Holders of
Exchangeable Shares to participate in such Proposed Sale to the same extent
and on an equivalent basis (such equivalence based on the number of shares of
Parent Common Stock for which the Exchangeable Shares are exchangeable) as
the holders of shares of Parent Common Stock, without discrimination, and
Parent shall use its best efforts in good faith so that Holders of
Exchangeable Shares may participate in the Proposed Sale without being
required to exchange Exchangeable Shares except to the extent of the cash
component of the Proposed Sale.
(d) To the extent that the consideration receivable by holders of the
Parent Common Stock is represented in whole or in part by property other than
cash and such other property is non-taxable to such holders GENERALLY in
whole or in part, and the Parent Board of Directors, after using its best
efforts to attempt to ensure that Holders of Exchangeable Shares do not have
to exchange their shares, determines in good faith that it is not practicable
in the circumstances of the Proposed Sale to provide for the deferral of the
taxable event that will arise from such Proposed Sale in so far as it affects
the Holders of Exchangeable Shares GENERALLY (by continuation of the tax
deferral provided by the Newco II Exchangeable Shares structure or
otherwise), Parent may nevertheless enter into the Proposed Sale, ensuring
firstly that the consideration to be received by the Holders of the
Exchangeable Shares is equivalent on a per share pre-tax basis to the
consideration to be received by holders of Parent Common Stock and shall
FURTHER use its best efforts to maintain the economic equivalency of the
Proposed Sale to such Holders of Exchangeable Shares GENERALLY, compared to
the situation of the holders of Parent Common Stock GENERALLY, taking into
account such Holders' loss of tax deferral for Canadian income tax purposes,
by:
(i) adjustment upward of the economic consideration to be received by
the Holders of the Exchangeable Shares relative to such
consideration received by holders of Parent Common Stock; or
(ii) compensating such Holders by other means.
Any issues of economic equivalency shall be determined by the Parent Board of
Directors in good faith and in its sole discretion.
(e) Parent will take all necessary steps to ensure that any exchange
of Exchangeable Shares required in connection with such Proposed Sale shall
be effective only upon, and shall be conditional upon, the closing of the
Proposed Sale.
(f) To the extent that implementation of the Proposed Sale necessarily
involves the exchange by the Holders of Exchangeable Shares of such shares,
the Parent Board of Directors shall ensure that the consideration receivable
by the Holders of Exchangeable Shares is not subject to any escrow or
transfer restrictions which would prevent immediate liquidation of such
consideration to pay tax, except as a Holder may otherwise agree.
- 12 -
(g) To the extent that any cash or non-cash consideration received by
holders of Parent Common Stock is taxable on the completion of the Proposed
Sale, the Parent Board of Directors need not consider the economic
equivalency to Holders of Exchangeable Shares beyond ensuring that they are
able to receive the same consideration per share and that such non-cash
consideration is to the extent taxable not subject to any escrow or other
restriction and can be liquidated immediately to pay tax, except as a Holder
may otherwise agree.
(h) Subject to the foregoing provisions of this Section 2.8, if the
Proposed Sale is approved at a meeting of stockholders of Parent and the
Holders of Exchangeable Shares were entitled to vote on such Proposed Sale
through the voting trust arrangement as provided in Article 4 of the Exchange
and Voting Trust Agreement, the Proposed Sale may occur without the further
approval of the Holders of Exchangeable Shares under Article 10 of the
Exchangeable Share Provisions.
(i) If the consideration receivable by holders of the Parent Common
Stock is non-taxable to such holders generally but such consideration to be
received by Holders of Exchangeable Shares is taxable generally to Holders of
Exchangeable Shares, and if such consideration or additional compensation to
be received by Holders of Exchangeable Shares is not readily marketable, (the
"NON MARKETABLE CONSIDERATION") then Parent Board of Directors shall use its
best efforts to issue Parent Common Stock in exchange for a portion of the
Non Marketable Consideration, acquire or arrange for the acquisition of a
portion of the Non Marketable Consideration for cash or other readily
marketable consideration, or in some other manner provide a means for the
Holders of Exchangeable Shares to similarly liquidate a portion of such Non
Marketable Consideration, such portion to be in an amount sufficient only to
permit the Holders of Exchangeable Shares to satisfy the tax liability
incurred by such Holders in connection with the Non Marketable Consideration
so received.
(j) Economic equivalency for purposes of the Holders' loss of tax
deferral for Canadian income tax purposes shall be valued in Section
3.8(d)(i) above as the amount of income tax payable upon the loss of such tax
deferral multiplied by an interest factor equal to the "PRIME RATE" per
annum, which product shall be multiplied by the period stated in years (and
any fraction thereof) from the date of the closing of the Proposed Sale to
the fifth anniversary of the date of initial issuance of the Class A Special
Shares. The "Prime Rate" shall be the average U.S. Prime Rate as last
reported in the Wall Street Journal on the Business Day closest to 60 days
prior to the Proposed Sale Date. The income tax payable shall be estimated in
good faith by the Parent Board of Directors based on the estimated fair
market value of the consideration to be received. The amount of income tax
shall be calculated on an aggregate hypothetical basis for all Holders of
Exchangeable Shares (assuming there is a capital gain and income taxes are
paid based on an assumed tax rate of 50 percent) but without additional gross
up for taxes based on the additional consideration. The determinations under
this subsection shall be made by the Parent Board of Directors in good faith.
- 13 -
(k) In the event of any dispute concerning the application of the
provisions of this Section 2.8 in connection with a Proposed Sale, the Board
of Directors shall determine in good faith what is fair in the circumstances
to settle the matter.
(l) This Section 2.8 shall be applicable notwithstanding any
provisions in this Agreement, the Exchange and Voting Trust Agreement, or the
Exchangeable Share Provisions to the contrary and is intended to provide the
Parent Board of Directors with the authority to take the actions reasonably
necessary to implement a Proposed Sale without the prior approval of the
Holders of the Exchangeable Shares as may be otherwise required under the
Support Agreement, the Exchange and Voting Trust Agreement, or the
Exchangeable Share Provisions, but subject nevertheless to any required vote
of shareholders.
2.9 OWNERSHIP OF OUTSTANDING SHARES OF NEWCO I, USA V AND NEWCO II.
Without the prior approval of Newco I, USA V and Newco II and the prior
approval of the Holders of the Exchangeable Shares given in accordance with
Article 10 of the Exchangeable Share Provisions, Parent covenants and agrees
in favor of Newco I, USA V, Newco II and the Holders that, as long as any
outstanding Exchangeable Shares are owned by a Holder, Parent will be and
remain the direct or indirect beneficial owner of all issued and outstanding
shares in the capital of Newco I and USA V and Newco I and USA V shall remain
the direct or indirect beneficial owner of all issued and outstanding Common
Shares in the capital of Newco II; provided this shall not restrict the
pledging by Parent of any such shares to a commercial lender or financial
institution in connection with a loan or other financial accommodation to
Parent or any of its subsidiaries, but upon a foreclosure of any such shares,
the purchaser of such shares shall be bound by the covenants of Parent, Newco
I, USA V and Newco II, as applicable, hereunder.
2.10 PARENT AND SUBSIDIARIES NOT TO VOTE EXCHANGEABLE SHARES. Parent
covenants and agrees that it will appoint and cause to be appointed proxy
holders with respect to all Exchangeable Shares held by Parent and its
Subsidiaries for the sole purpose of attending each meeting of holders of
Exchangeable Shares in order to be counted as part of the quorum for each
such meeting to the extent but only to the extent that such presence is
required under the provisions of the applicable corporate statute or the
Exchangeable Share Provisions in order to obtain a quorum to conduct a
meeting of holders of Exchangeable Shares (the "REQUIRED PRESENCE"). Parent
further covenants and agrees that it will not, and will cause its
Subsidiaries not to, exercise any voting rights which may be exercisable by
holders of Exchangeable Shares from time to time pursuant to the Exchangeable
Share Provisions or pursuant to the provisions of the applicable corporate
statute (or any successor or other corporate statute by which Newco I, USA V
or Newco II may in the future be governed) with respect to any Exchangeable
Shares held by it or by its Subsidiaries in respect of any matter considered
at any meeting of holders of Exchangeable Shares; provided that to the
extent, if any, of the Required Presence, Parent or its Subsidiaries may
exercise the voting rights, if any, with
- 14 -
respect to such Required Presence to vote such Exchangeable Shares on the
same side as the Holders of Exchangeable Shares who have cast the majority of
votes (excluding those cast by a holder not a Holder) for or against the
applicable resolution to be voted upon.
2.11 RULE 10b-18 PURCHASES. Anything to the contrary in this Agreement
notwithstanding, Parent shall not be obligated to take any action hereunder
which would prevent Parent from effecting repurchases of Parent Common Stock
pursuant to the "safe harbor" provisions of Rule 10b-18 promulgated under the
U.S. Securities Exchange Act of 1934 as amended or any successor provision
thereof.
ARTICLE III
CERTAIN RESTRICTIONS
3.1 NEWCO I RESTRICTIONS. Subject to what is hereinafter provided, so
long as any of the Exchangeable Shares are outstanding and held by Holders,
Newco I shall not at any time without, but may at any time with, the approval
of the Holders of the Exchangeable Shares given as specified in Article 10 of
the Exchangeable Share Provisions:
(a) incur indebtedness or other liabilities except as may be desirable
for or reasonably required or incidental to performance of the
terms and conditions of this Agreement, the Exchange and Voting
Trust Agreement or the Exchangeable Share Provisions or the rights
and obligations of Newco I, Parent or Newco II relating thereto,
or to guarantee the obligations of any other party except as set
forth in the preceding exception or insofar as recourse of the
obligee on the guarantee is limited to the preferred shares of
YPtel Inc. held by the Company on or after the Closing Date and
the dividends and other distributions and proceeds with respect to
such preferred shares, and any dividends issued or other
distributions made with respect to the common stock of the Company
or Newco II or the proceeds thereof (collectively, the
"COLLATERAL");
(b) voluntarily liquidate, dissolve or wind-up or otherwise distribute
substantially all of its assets or cause Newco II to do so;
(c) issue any shares other than to Parent; or
(d) transfer any of the Common Shares of Newco II other than to
Parent, USA V or Newco II, except in connection with a pledge
thereof as set forth below; or
(e) enter into or operate any business other than that of a holding
company owning the shares of Newco II and any business incidental
thereto or other than any business reasonably required or
appropriate for Newco I to carry out its rights, duties or
obligations pursuant to the provisions of the Exchangeable Share
Provisions, the Exchange and Voting Trust Agreement or this
Agreement or in
- 15 -
connection with the investment and distribution of any dividends
of or distributions by Newco II or the Company.
Nothing contained herein or in Section 3.2 below shall restrict the pledging
by Newco I of the Common Shares of Newco II (or indirectly the common stock
of the Company) or the pledging by Newco II of the common stock of the
Company, in either case to secure a loan or other financial accommodation to
Parent or any of its subsidiaries by a commercial lender or financial
institution ("LENDER") to the extent such security is required by such Lender
in order to preserve or better protect its lien on or rights in the
Collateral or to the extent that the Lender agrees that upon a foreclosure or
sale by Lender of such shares, the purchaser of such shares shall be bound by
the covenants of Parent, Newco I, USA V and Newco II, as applicable
hereunder, each of which shall remain liable under its respective covenants.
3.2 NEWCO II RESTRICTIONS. Subject to what is otherwise provided in
Section 3.1 above, so long as any of the Exchangeable Shares are outstanding
and held by a Holder, Newco II shall not at any time without, but may at any
time with, the approval of the Holders of the Exchangeable Shares given as
specified in Article 10 of the Exchangeable Share Provisions:
(a) incur indebtedness or other liabilities except as may be desirable
for or reasonably required or incidental to performance of the
terms and conditions of this Agreement, the Exchange and Voting
Trust Agreement or the Exchangeable Share Provisions or the rights
and obligations of Newco I, Parent, USA V or Newco II relating
thereto, or to guarantee the obligations of any other party except
insofar as recourse of the obligee on the guarantee is limited to
the Collateral;
(b) transfer any of the common stock of the Company, other than to
Newco I and USA V, except in connection with a pledge thereof as
set forth in Section 3.1 hereof;
(c) issue any Common Shares other than to Newco I or USA V; or
(d) amend its Articles of Association after the effective date hereof,
except for minor amendments consistent with the purposes set
forth in Section 4.4 hereof.
3.3 PARENT SUCCESSOR OR PURCHASER. Subject to Section 2.8 hereof, in
the event there is a Parent Successor pursuant to Section 12.1 of the
Exchange and Voting Trust Agreement or other purchaser of substantially all
the outstanding shares of Parent Common Stock, the covenants of and
restrictions applicable to Newco I, USA V and Newco II shall continue in full
force and effect (substituting the Parent Successor or such purchaser for
Parent, as applicable), Subject to the terms of any applicable supplemental
agreement referred to in said Section 12.1, and Parent shall not thereby be
released from any obligations or liabilities then accrued hereunder except to
the extent that such obligations or liabilities are assumed by the Parent
Successor or such purchaser.
- 16 -
ARTICLE IV
GENERAL
4.1 TERM. This Agreement shall come into force and be effective when
and as provided in Section 4.13 below, and shall terminate and be of no
further force and effect at such time as the Exchange and Voting Trust
Agreement shall terminate (or shall no longer continue) as provided in
Section 14.2 of the Exchange and Voting Trust Agreement.
4.2 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.
4.3 AMENDMENTS, MODIFICATIONS, ETC. Subject to amendments of the
nature contemplated by Section 13.4 of the Exchange and Voting Trust
Agreement, this Agreement may not be amended, modified or waived except by an
agreement in writing executed by Newco I, Newco II and Parent and approved by
the Holders of the Exchangeable Shares in accordance with Article 10 of the
Exchangeable Share Provisions.
4.4 MINISTERIAL AMENDMENTS. Notwithstanding the provisions of Section
4.3, Newco I, USA V, Newco II and Parent may in writing, at any time and from
time to time, upon reasonable notice to (including sufficient details of the
proposed changes) but without the approval of the Holders of the Exchangeable
Shares, amend or modify this Agreement for the purposes of:
(a) adding to the covenants of any or all parties hereto 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 good faith opinion of the board of
directors of each of Parent, Newco I and Newco II, having in mind
the best interests of the Holders as a whole, it may be expedient
to make, provided that each such board of directors shall be of
the good faith opinion that such amendments or modifications will
not be prejudicial to the interests of the Holders as a whole; or
(c) making such changes or corrections which, on the advice of counsel
to Parent, Newco I and Newco II, are required for the purpose of
curing or correcting any ambiguity or defect or inconsistent
provision or clerical omission or mistake or manifest error,
provided that the boards of directors of each of Parent, Newco I
and Newco II shall be of the opinion that such changes or
corrections will not be prejudicial to the interests of the
Holders as a whole.
- 17 -
4.5 MEETING TO CONSIDER AMENDMENTS. Newco II, at the request of
Parent, Newco I or any ten Holders, 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 hereto. Any
such meeting or meetings shall be called and held in accordance with the
Exchangeable Share Provisions and, to the extent applicable, the Articles of
Association of Newco II and all applicable laws and shall be held in the City
of Toronto. An approval of Holders may be obtained by written consents in
lieu of a meeting, as provided in Article 10 of the Exchangeable Share
Provisions.
4.6 ENUREMENT. This Agreement shall be binding upon and enure to the
benefit of the parties hereto, the Holders, from time to time, of
Exchangeable Shares and each of their respective heirs, successors and
assigns. The Company shareholders party to this Agreement are contemplated to
become Holders hereunder when the Class A Special Shares are issued on the
Closing Date. Upon any such party becoming a Holder hereunder, such party
will be party to this Agreement in its capacity as a Holder, and upon any
substitution of Class A Special Shares in connection with the Newco II
Amalgamation, shall remain a Holder hereunder. Any transferee hereafter
becoming a Holder shall be substituted for its transferor under this
Agreement upon the date of such transfer, and the transferor shall be
released from any obligations or liability thereafter arising under this
Agreement. From and after the Newco II Amalgamation, the parties expressly
confirm that the Amalgamated Newco II shall automatically succeed to and
become obligated to perform all the obligations of Newco II hereunder and
shall be entitled to all the rights of Newco II and for all intents and
purposes of this Agreement shall thereupon become the Newco II party
hereunder.
4.7 NOTICE. All notices and other communications hereunder shall be in
writing and shall be deemed given to a party if delivered, sent by facsimile
transmission with confirmation of transmission, or mailed by registered or
certified mail (postage prepaid and return receipt requested) to the parties
at the following addresses and facsimile numbers (or at such other address or
facsimile number for the parties as the parties shall specify by like
notice), and such notice shall be deemed given: (i) if delivered to the
party, on the date of such delivery; (ii) if telecopied, on the date of
confirmation of receipt or transmission, unless such day is not a Business
Day, in which case it shall be deemed to have been given and received upon
the immediately following Business Day; or (iii) if mailed, five (5) Business
Days after mailing:
TO PARENT, NEWCO I, USA V OR NEWCO II:
c/o 000 Xxxxx Xxxxx Xxxx Xxxx
Xxxxx 000
Xx. Xxxxx, Xxxxxxxx
X.X.X. 63017
Attention: the President
FACSIMILE NO.: (000) 000-0000
- 18 -
WITH COPIES TO:
Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx
X.X.X. 00000-0000
Attention: Xxxxx Xxxxx
FACSIMILE NO.: (000) 000-0000
AND
XxXxxxx Xxxxxx
0000 Xxxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxx Xxxxxx
Xxxxxx
X0X 0X0
Attention: Xxxxxx Xxxxxxx
FACSIMILE NO: (000) 000-0000
AND
c/o Imperial Capital Limited
1 First Canadian Place
P.O. Box 438
Suite 5102
Xxxxxxx XX X0X 0X0
Attention: Managing Partner
FACSIMILE NO.: (000) 000-0000
AND
Xxxxxxx, Xxxxx & Xxxxxxxxx LLP
Scotia Plaza, Suite 2100
00 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Attention: Xxxxxxx Xxxxxxx
FACSIMILE NO.: (000) 000-0000
TO THE HOLDERS:
At their respective addresses
appearing on the records of
the Transfer Agent
- 19 -
WITH COPIES TO:
Imperial Capital Limited
1 First Canadian Place
P.O. Box 438
Suite 5102
Xxxxxxx XX X0X 0X0
Attention: Managing Partner
FACSIMILE NO.: (000) 000-0000
AND:
Xxxxxxx, Xxxxx & Xxxxxxxxx LLP
Scotia Plaza, Suite 2100
00 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Attention: Xxxxxxx Xxxxxxx
FACSIMILE NO.: (000) 000-0000
Any notice period providing for notice to be given twenty (20) or more days
before a specified date or event may be calculated as if the date of mailing
were the date of giving notice. Notwithstanding any requirement for written
notice in this Agreement, any notices provided herein to be given as between
Newco I, USA V, Newco II, Parent and Transfer Agent may be given by
telephone, by fax or otherwise in an informal manner as such entities may
agree among themselves from time to time and such notices may be subject to
standing orders as to particular notices.
4.8 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. One or more of the parties may sign
this Agreement and deliver this Agreement by facsimile transmission. The
parties agree that a facsimile of a signature shall be deemed an original
signature.
4.9 JURISDICTION. Except to the extent that the Delaware and Nova
Scotia corporate laws under which Parent, Newco I and Newco II are,
respectively, organized govern the determination of particular corporate
issues under this Agreement, this Agreement shall be construed and enforced
in accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein.
4.10 ATTORNMENT. Each of the parties hereto, on behalf of such party
and such party's heirs, personal representatives, successors and permitted
assigns, agrees that any action or proceeding arising out of or relating to
this Agreement may be instituted in the courts of Ontario, waives any
objection which it may have now or hereafter to the venue of any such action
or proceeding, irrevocably submits to the jurisdiction of such courts in any
such action or proceeding, agrees to be bound by any judgment of such courts
and not to seek,
- 20 -
and hereby waives, any review of the merits of any such judgment by the
courts of any other jurisdiction.
4.11 CONSTRUCTION. The parties hereto agree that they have been
represented by counsel during the negotiation and execution of this Agreement
and, therefore, waive the application of any law, regulation, holding or rule
of construction providing that ambiguities in an agreement or other document
will be construed against the party drafting such agreement or document.
4.12 EXCHANGEABLE SHARE PROVISIONS. The parties hereto agree to take
such actions, execute such documents, and vote such securities as are
necessary to give full effect to the Exchangeable Share Provisions, as if
they comprised a contract among such parties.
4.13 EFFECTIVENESS OF AGREEMENT. This Agreement is being entered into
in anticipation of the "Closing" under the YPtel Agreement and the related
issuance of Class A Special Shares to certain of the Company shareholders in
exchange for some of their Company shares. This Agreement shall not become
effective until the Class A Special Shares are so issued on or before March
1, 2000, failing which this Agreement shall be null and void.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties have caused this Support Agreement to be
signed by their respective officers duly authorized, all as of the date first
written above.
ADVANCED COMMUNICATIONS GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------
ACG HOLDING COMPANY
By: /s/ Xxxxxxx X. Xxxxx
-------------------------
ACG EXCHANGE COMPANY
By: /s/ Xxxxxxx X. Xxxxx
-------------------------
1 + USA V ACQUISITION CORP.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------
CERTAIN HOLDERS OF SHARES OF YPTEL
LIMITED who will become Holders of
Class A Special Shares, as set out
on Schedule A hereto, by their
respective General Partners set out
on said Schedule
By: /s/ Xxxxxx Xxxxxx
-------------------------
Xxxxxx Xxxxxx,
Authorised Signing Officer
for each General Partner
YPtel/ACG Pledge Corporation will be a Holder of certain Class A Special
Shares pledged to it and joins in the above Agreement as a Holder pursuant to
the provisions of Section 7.3 of the Agreement.
YPTEL/ACG PLEDGE CORPORATION
By: /s/ Xxxxxx Xxxxxx
-------------------------
SCHEDULE A
THOSE OF THE FOLLOWING HOLDERS OF SHARES OF COMPANY (YPTEL LIMITED)
WHO BECOME HOLDERS OF CLASS A SPECIAL SHARES
------------------------------------------------------------------------------
GENERAL PARTNER LIMITED PARTNERSHIP
------------------------------------------------------------------------------
ACG 1 Inc. ACG 1 Limited Partnership
------------------------------------------------------------------------------
ACG 2 Inc. ACG 2 Limited Partnership
------------------------------------------------------------------------------
ACG 3 Inc. ACG 3 Limited Partnership
------------------------------------------------------------------------------
ACG 4 Inc. ACG 4 Limited Partnership
------------------------------------------------------------------------------
ACG 5 Inc. ACG 5 Limited Partnership
------------------------------------------------------------------------------
ACG 6 Inc. ACG 6 Limited Partnership
------------------------------------------------------------------------------
ACG 7 Inc. ACG 7 Limited Partnership
------------------------------------------------------------------------------
ACG 8 Inc. ACG 8 Limited Partnership
------------------------------------------------------------------------------
ACG 9 Inc. ACG 9 Limited Partnership
------------------------------------------------------------------------------
ACG 10 Inc. ACG 10 Limited Partnership
------------------------------------------------------------------------------
ACG 11 Inc. ACG 11 Limited Partnership
------------------------------------------------------------------------------
ACG 12 Inc. ACG 12 Limited Partnership
------------------------------------------------------------------------------
ACG 13 Inc. ACG 13 Limited Partnership
------------------------------------------------------------------------------
ACG 14 Inc. ACG 14 Limited Partnership
------------------------------------------------------------------------------
ACG 15 Inc. ACG 15 Limited Partnership
------------------------------------------------------------------------------
ACG 16 Inc. ACG 16 Limited Partnership
------------------------------------------------------------------------------
ACG 17 Inc. ACG 17 Limited Partnership
------------------------------------------------------------------------------
ACG 18 Inc. ACG 18 Limited Partnership
------------------------------------------------------------------------------
ACG 19 Inc. ACG 19 Limited Partnership
------------------------------------------------------------------------------
ACG 20 Inc. ACG 20 Limited Partnership
------------------------------------------------------------------------------
ACG 21 Inc. ACG 21 Limited Partnership
------------------------------------------------------------------------------
ACG 22 Inc. ACG 22 Limited Partnership
------------------------------------------------------------------------------
------------------------------------------------------------------------------
GENERAL PARTNER LIMITED PARTNERSHIP
------------------------------------------------------------------------------
ACG 23 Inc. ACG 23 Limited Partnership
------------------------------------------------------------------------------
ACG 24 Inc. ACG 24 Limited Partnership
------------------------------------------------------------------------------
ACG 25 Inc. ACG 25 Limited Partnership
------------------------------------------------------------------------------
ACG 26 Inc. ACG 26 Limited Partnership
------------------------------------------------------------------------------
ACG 27 Inc. ACG 27 Limited Partnership
------------------------------------------------------------------------------
ACG 28 Inc. ACG 28 Limited Partnership
------------------------------------------------------------------------------
ACG 29 Inc. ACG 29 Limited Partnership
------------------------------------------------------------------------------
ACG 30 Inc. ACG 30 Limited Partnership
------------------------------------------------------------------------------
ACG 31 Inc. ACG 31 Limited Partnership
------------------------------------------------------------------------------
ACG 32 Inc. ACG 32 Limited Partnership
------------------------------------------------------------------------------
ACG 33 Inc. ACG 33 Limited Partnership
------------------------------------------------------------------------------
ACG 34 Inc. ACG 34 Limited Partnership
------------------------------------------------------------------------------
ACG 35 Inc. ACG 35 Limited Partnership
------------------------------------------------------------------------------
ACG 36 Inc. ACG 36 Limited Partnership
------------------------------------------------------------------------------
ACG 37 Inc. ACG 37 Limited Partnership
------------------------------------------------------------------------------
ACG 38 Inc. ACG 38 Limited Partnership
------------------------------------------------------------------------------
ACG 39 Inc. ACG 39 Limited Partnership
------------------------------------------------------------------------------
ACG 40 Inc. ACG 40 Limited Partnership
------------------------------------------------------------------------------
ACG 41 Inc. ACG 41 Limited Partnership
------------------------------------------------------------------------------
ACG 42 Inc. ACG 42 Limited Partnership
------------------------------------------------------------------------------
