Exhibit 99.5
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CINRAM INTERNATIONAL INC.
- AND -
CINRAM INTERNATIONAL INCOME FUND
- AND -
CII TRUST
ADMINISTRATION AGREEMENT
MAY 5, 2006
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TABLE OF CONTENTS
Page
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ARTICLE 1 - INTERPRETATION.............................................. 1
1.01 Definitions................................................. 1
1.02 Headings.................................................... 3
1.03 Interpretation.............................................. 3
1.04 General Limitation of Liability and Indemnification......... 3
ARTICLE 2 - SERVICES.................................................... 3
2.01 Administrative and Support Services for the Fund............ 3
2.02 Administrative and Support Services for the Trust........... 4
2.03 Covenants of the Administrator.............................. 4
2.04 Administrator's Acknowledgements............................ 5
2.05 Non-Resident Unitholders.................................... 5
2.06 Authority of Administrator.................................. 5
2.07 Powers and Authorities of the Administrator................. 6
2.08 Restrictions on the Administrator's Powers and Authorities.. 6
2.09 Execution of Documents...................................... 6
ARTICLE 3 - EXPENSES AND FEES........................................... 7
3.01 Expenses.................................................... 7
3.02 Payment of GST.............................................. 7
3.03 Fee......................................................... 7
ARTICLE 4 - FINANCIAL STATEMENTS AND RECORDS............................ 7
4.01 Books and Records........................................... 7
4.02 Examination of Records...................................... 7
4.03 Compliance.................................................. 7
ARTICLE 5 - OBLIGATIONS AND COVENANTS OF THE FUND AND THE TRUST......... 8
5.01 Obligations and Covenants of the Fund and Trust............. 8
ARTICLE 6 - ACTIVITIES OF THE ADMINISTRATOR............................. 8
6.01 Standard of Care and Delegation............................. 8
6.02 Reliance.................................................... 8
6.03 No Liability for Advice..................................... 9
ARTICLE 7 - INDEMNIFICATION............................................. 9
7.01 Indemnification of the Administrator........................ 9
7.02 Indemnification of the Fund and the Trust................... 9
ARTICLE 8 - TERM........................................................ 9
8.01 Term........................................................ 9
8.02 Survival.................................................... 10
ARTICLE 9 - TERMINATION................................................. 10
9.01 Events of Termination by the Fund and Trust................. 10
9.02 Remedies of the Administrator............................... 10
9.03 Events of Termination by the Administrator.................. 10
9.04 Remedies of the Fund and Trust.............................. 11
9.05 Post Termination Arrangements............................... 11
ARTICLE 10 - FORCE MAJEURE............................................... 11
10.01 Consequences of Force Majeure............................... 11
10.02 Notice...................................................... 11
ARTICLE 11 - MISCELLANEOUS............................................... 11
11.01 No Partnership, Joint Venture, Agency or Trust.............. 11
11.02 Amendments.................................................. 11
11.03 Successors and Assigns...................................... 11
11.04 Severability................................................ 12
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11.05 Notices...................................................... 12
11.06 Governing Law................................................ 12
11.07 Further Assurances........................................... 13
11.08 Time of Essence.............................................. 13
11.09 Entire Agreement............................................. 13
ADMINISTRATION AGREEMENT
This Agreement is made as of the 5th day of May, 2006
BETWEEN:
CINRAM INTERNATIONAL INC., a company incorporated under the
Canada Business Corporations Act (the "ADMINISTRATOR")
- and -
CINRAM INTERNATIONAL INCOME FUND, an unincorporated, open-ended
limited purpose trust established under the laws of the Province
of Ontario (the "Fund")
- and -
CII TRUST, a trust constituted under the laws of the Province of
Ontario (the "TRUST")
WHEREAS the Fund has issued trust units to the public and has acquired
units and Series 1 notes of the Trust;
AND WHEREAS the Trust has acquired Class A limited partnership units
of Cinram International Limited Partnership ("HOLDING PARTNERSHIP");
AND WHEREAS Holding Partnership indirectly owns all of the shares of
the Administrator;
AND WHEREAS the Fund and the Trust wish to retain the Administrator to
provide certain administrative and support services;
AND WHEREAS the Administrator is willing to render such administrative
and support services on the terms and conditions set forth herein;
NOW THEREFORE in consideration of the premises and the mutual
covenants and agreements herein contained, the sufficiency of which is hereby
acknowledged by each of the parties to this Agreement, the parties agree as
follows:
ARTICLE 1 - INTERPRETATION
1.01 DEFINITIONS
In this Agreement:
"ADMINISTRATOR EVENT OF TERMINATION" means any of the events described in
Section 9.03;
"BUSINESS DAY" means any day, other than Saturday, Sunday or any statutory
holiday in the Province of Ontario;
"EXPENSES" means all reasonable out-of-pocket expenses incurred by the
Administrator on behalf of the Fund or the Trust, in connection with
carrying out its duties and obligations hereunder, including legal and
audit fees and other expenses incurred in ensuring compliance by the Fund
or the Trust with all applicable laws and stock exchange requirements,
including continuous disclosure obligations, and any expenses of the Fund
or the Trust, paid by the Administrator on their behalf;
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"FORCE MAJEURE" means an event, condition or circumstance (and the effect
thereof) which is not within the reasonable control of the party claiming
Force Majeure and which, by the exercise of due diligence the party
claiming Force Majeure is unable to prevent or overcome, including acts of
God, fire, explosion, civil disturbance, war, riot, insurrection, military
or guerrilla action, terrorist activity, economic sanction, blockade or
embargo, sabotage, flooding, earthquake, drought and action or restraint by
the order of any governmental authority (so long as the party claiming
Force Majeure has not applied for or assisted in the application for, and
has opposed where and to the extent possible, such action or restraint by
such governmental authority); provided, however, that a party's own lack of
funds shall not constitute "Force Majeure" in respect of such party;
"FUND DECLARATION OF TRUST" means the declaration of trust dated March 21,
2006, pursuant to which the Fund was established, as amended, supplemented
or restated from time to time;
"FUND EVENT OF TERMINATION" means any of the events described in Section
9.01;
"FUND TRUSTEES" means trustees of the Fund;
"GST" means the goods and services tax under the Excise Tax Act (Canada);
"INSOLVENT" means in relation to any person, being insolvent, bankrupt,
making a proposal under the Bankruptcy and Insolvency Act (Canada) or
having a trustee or receiver or manager appointed in respect of its assets;
"PERSON" means any natural person, corporation, division of a corporation,
partnership, trust, joint venture (which includes a co-ownership),
association, company, estate, unincorporated organization or government or
governmental authority;
"PUBLIC EXPENSES" means the incremental administrative and other expenses
which will be incurred by the Fund, the Trust and the Administrator, solely
by virtue of the Fund being a public entity including, without limitation,
compensation of the Fund Trustees and the Trust Trustees, fees payable to
securities regulatory authorities and stock exchanges, investor relations
expenses, costs of reporting to holders of Units, directors' and officers'
insurance costs and professional fees relating to public entity matters;
"TERM" has the meaning ascribed thereto in Section 8.01;
"TRUST DECLARATION OF TRUST" means the declaration of trust dated March 21,
2006 pursuant to which Trust was established, as amended, supplemented or
restated from time to time;
"TRUST NOTE INDENTURE" means the note indenture dated May 5, 2006, between
the Trust and Computershare Trust Company of Canada governing the Trust
Notes, pursuant to which the Trust issued Series 1 Trust Notes, and may
issue Series 2 Trust Notes and Series 3 Trust Notes, as amended,
supplemented or restated from time to time;
"TRUST NOTES" means, collectively, the Series 1 Trust Notes, Series 2 Trust
Notes and Series 3 Trust Notes of the Trust;
"TRUST TRUSTEES" means the trustees of the Trust;
"TRUST UNITS" means trust units issued by the Trust;
"UNITS" means trust units of the Fund including special voting units; and
"UNITHOLDERS" means holders of Units.
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1.02 HEADINGS
The section headings in this Agreement have been inserted for
convenience of reference only and shall not be construed to affect the meaning,
construction or effect of this Agreement.
1.03 INTERPRETATION
Words importing the singular number only shall include the plural and
vice versa. Words importing gender shall include all genders. Where the word
"including" or "includes" is used in this Agreement it means "including without
limitation" or "includes without limitation", respectively. Any reference to any
document shall include a reference to any schedule, amendment or supplement
thereto or any agreement in replacement thereof, all as permitted under such
document.
1.04 GENERAL LIMITATION OF LIABILITY AND INDEMNIFICATION
The parties hereto acknowledge that each of the Fund Trustees and the
Trust Trustees are entering into this Agreement solely in their capacity as
trustees, on behalf of the Fund and the Trust, respectively, and the obligations
of the Fund and the Trust, respectively, hereunder shall not be personally
binding upon the trustees or any of the Unitholders or holders of Trust Units or
any annuitant under a registered retirement savings plan, registered retirement
income fund, registered education savings plan or deferred profit sharing plan
of which any such unitholder acts as trustee or carrier (an "ANNUITANT") and
that any recourse against the Fund, the Trust or any of their respective
trustees or unitholders or annuitants in any manner in respect of any
indebtedness, obligation or liability of the Fund or the Trust arising hereunder
or arising in connection herewith or from the matters to which this Agreement
relates, if any, including claims based on negligence or otherwise tortious
behaviour, shall be limited to, and satisfied only out of, the assets and
property of the Fund or the Trust, as the case may be.
ARTICLE 2 - SERVICES
2.01 ADMINISTRATIVE AND SUPPORT SERVICES FOR THE FUND
Subject to and in accordance with the terms, conditions and
limitations of the Fund Declaration of Trust, the Fund hereby delegates to the
Administrator, and the Administrator hereby agrees to be responsible for,
administrative services necessary for the operation of the Fund, including the
following:
(a) assist the Fund Trustees in making all determinations necessary for
the discharge of the Fund Trustees' obligations under the Fund
Declaration of Trust;
(b) submit all annual audited and interim unaudited financial statements
of the Fund, income tax returns and filings to the Fund Trustees in
sufficient time prior to the dates upon which they must be delivered
to Unitholders and/or filed so that the Fund Trustees have a
reasonable opportunity to review them, approve them and return them to
the Administrator, and arrange for their delivery to Unitholders
and/or filing within the time required by applicable law;
(c) assist the Fund Trustees in computing distributions to Unitholders
including calculating Cash Flow of the Fund (within the meaning of the
term "Cash Flow of the Trust" as such term is defined in the Fund
Declaration of Trust) and facilitate payment of distributions properly
declared payable by the Fund;
(d) endeavour to ensure compliance by the Fund with all applicable laws,
including securities laws, tax laws and continuous disclosure
obligations (and, for greater certainty, to make all filings on behalf
of the Fund required to so comply);
(e) ensure that the Fund elects in the prescribed manner and within the
prescribed time under subsection 132(6.1) of the Income Tax Act
(Canada) to be a "mutual fund trust" within the meaning of that Act
since inception, monitor the Fund's status as a mutual fund trust and
provide
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the Fund Trustees with written notice when the Fund ceases or is at
risk of ceasing to be such a mutual fund trust;
(f) provide investor relations services to the Fund;
(g) at the request and under the direction of the Fund Trustees, call and
hold all annual and/or special meetings of Unitholders pursuant to the
Fund Declaration of Trust and prepare for approval by the Fund
Trustees and arrange for the distribution of all materials (including
notices of meetings and information circulars) in respect thereof;
(h) prepare and provide or cause to be provided to Unitholders on a timely
basis all information to which Unitholders are entitled under the Fund
Declaration of Trust and under applicable law, including quarterly and
annual reports, notices, financial statements and tax information
relating to the Fund;
(i) attend to all administrative and other matters arising in connection
with any redemptions of Units;
(j) ensure compliance with the Fund's limitations on non-resident
ownership, as more particularly set out in Section 2.05;
(k) provide advice to the Fund Trustees with respect to the timing and
terms of future offerings of Units, if any;
(l) assist the Fund Trustees in connection with any offerings of Units,
including preparing any prospectuses or comparable documents of the
Fund to qualify the distribution of securities of the Fund from time
to time;
(m) endeavour to ensure that the Fund complies with its ongoing legal and
contractual obligations (and, for greater certainty, to act on behalf
of the Fund in fulfilling its obligations thereunder);
(n) endeavour to ensure that the Fund complies with all requirements of,
and on behalf of the Fund interface with, the Toronto Stock Exchange
and any other stock exchange or similar organization through or on
which its Units are traded (and, for greater certainty, to make all
filings on behalf of the Fund required to so comply);
(o) interface with all governmental regulatory organizations;
(p) oversee the process of making distributions to Unitholders and
interface with any corporate or indenture trustees in relation to
same;
(q) promptly notify the Fund of any event that might reasonably be
expected to have a material adverse effect on the affairs of the Fund;
and
(r) generally provide all other services as may be necessary or as
requested by the Fund Trustees, for the administration of the Fund.
2.02 ADMINISTRATIVE AND SUPPORT SERVICES FOR THE TRUST
Subject to and in accordance with the terms, conditions and
limitations of the Trust Declaration of Trust, the Trust hereby delegates to the
Administrator, and the Administrator hereby agrees to be responsible for,
administrative services necessary for the operation of Trust, including matters
of the nature referred to in Sections 2.01(a)-(d), (g), (h), (i), (m), (o), (q)
and (r), mutatis mutandis and matters relating to the Trust Note Indenture.
2.03 COVENANTS OF THE ADMINISTRATOR
The Administrator covenants and agrees that in the performance of its
services under this Agreement it shall:
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(a) perform all services at all times in compliance with applicable law;
(b) comply with all instructions of the Fund Trustees and Trust Trustees,
as applicable, in relation to the performance of its services
hereunder; and
(c) observe or use all commercially reasonable efforts to cause to be
observed and performed on behalf of each of the Fund and the Trust in
every material respect the provisions of the agreements from time to
time entered into in connection with the activities of the Fund or the
Trust.
2.04 ADMINISTRATOR'S ACKNOWLEDGEMENTS
The Administrator acknowledges that it has received a copy of each of
the Fund Declaration of Trust and the Trust Declaration of Trust and is familiar
with and understands the duties of the respective parties thereto, including
those duties of the Fund Trustees and Trust Trustees which are being delegated
to the Administrator under this Agreement.
2.05 NON-RESIDENT UNITHOLDERS
The Administrator shall use reasonable efforts to monitor the
residence status of Unitholders. If, at any time, the Administrator is of the
opinion that the Fund Trustees should require declarations as to the residence
or partnership status of Unitholders under Section 13.6 of the Fund Declaration
of Trust, it shall so advise the Fund Trustees and provide the form of the
declaration therefor to the Fund Trustees. If, in the reasonable opinion of the
Administrator, the beneficial owners of 45 percent (45%) or more of the Units
then outstanding (on either a basic or fully-diluted basis) are or may be
"non-residents" of Canada and partnerships other than "Canadian partnerships"
(both within the meaning of the Income Tax Act (Canada)) or such a situation is
imminent, the Administrator shall so advise the Fund Trustees and provide the
Fund Trustees with an announcement thereof in a form suitable for use by the
Fund Trustees pursuant to Section 13.6 of the Fund Declaration of Trust. If the
Administrator reasonably believes that 45 percent (45%) or more of the Units (on
either a basic or fully-diluted basis) are held by "non-residents" of Canada and
partnerships other than "Canadian partnerships", it shall prepare and furnish to
the Fund Trustees notices to such Unitholders, requiring them to sell their
Units of the Fund or a specified portion thereof within a specified period of
time of not more than 30 days, in accordance with the Fund Declaration of Trust.
The Fund Trustees shall provide the Administrator with such information
regarding the residence and partnership status of Unitholders and the order of
acquisition or registration thereof as the Administrator may reasonably request,
from time to time, that the Fund Trustees may have in their possession in order
to assist the Administrator in fulfilling its obligations under this Section
2.05.
2.06 AUTHORITY OF ADMINISTRATOR
Subject to Section 2.09, the terms of the Fund Declaration of Trust
and/or the Trust Declaration of Trust and the overriding direction of the Fund
Trustees and the Trust Trustees, the Administrator shall have full right, power
and authority to execute and deliver all agreements, instruments and other
documents and to make applications and filings with governmental authorities and
to take such other actions as the Administrator considers appropriate in
connection with:
(a) the services to be provided to the Fund hereunder in the name of and
on behalf of the Fund, and no person shall be required to determine
the authority of the Administrator to give any undertaking or enter
into any commitment on behalf of the Fund, provided that the
Administrator shall not have the authority to commit to any
transaction which would require the approval of the Unitholders in
accordance with the Fund Declaration of Trust, and provided further
that in providing services hereunder the Administrator shall exercise
all voting rights attached to the Trust Units in accordance with the
terms of the Trust Declaration of Trust; and
(b) the services to be provided to the Trust hereunder in the name of and
on behalf of the Trust, and no person shall be required to determine
the authority of the Administrator to give any undertaking or enter
into any commitment on behalf of the Trust, provided that the
Administrator shall not have the authority to commit to any
transaction which would require the approval of the holders of Trust
Units in accordance with the Trust Declaration of Trust.
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2.07 POWERS AND AUTHORITIES OF THE ADMINISTRATOR
The Administrator shall have, subject to the provisions of this
Agreement, the Fund Declaration of Trust or the Trust Declaration of Trust and
the overriding direction of the Fund Trustees and the Trust Trustees, as the
case may be, all requisite powers and authorities, during the Term, to provide
the administrative and support services contemplated herein to the Fund and the
Trust.
2.08 RESTRICTIONS ON THE ADMINISTRATOR'S POWERS AND AUTHORITIES
In the exercise of its powers and authority and in the performance of
its obligations, covenants and responsibilities hereunder, the Administrator
shall not, without first obtaining the written approval of the Fund Trustees and
the Trust Trustees, charge or receive fees from any of the parties to this
Agreement.
2.09 EXECUTION OF DOCUMENTS
(a) The Administrator may execute any document required to be executed
pursuant to the terms hereof on behalf of the Fund as follows:
CINRAM INTERNATIONAL INCOME FUND
By its Administrator, CINRAM INTERNATIONAL INC.
Per: _________________________________
Authorized Signatory
(b) The Administrator may execute any document required to be executed
pursuant to the terms hereof on behalf of Trust as follows:
CII TRUST
By its Administrator, CINRAM INTERNATIONAL INC.
Per: _________________________________
Authorized Signatory
and provide for such signatures as may be required by applicable law.
All reasonable efforts shall be made to ensure that every agreement
entered into on behalf of the Fund and/or the Trust by the Administrator shall
(except as the Administrator may otherwise expressly agree in writing with
respect to personal liability of the Administrator) include a provision
substantially to the following effect:
The parties hereto acknowledge that Cinram International Inc. is
entering into this Agreement solely in its capacity as an
administrator on behalf of the Fund/the Trust and the obligations of
the Fund/the Trust hereunder shall not be personally binding upon any
of Cinram International Inc., any of the unitholders or trustees of
the Fund/the Trust or any annuitant under a plan of which a unitholder
is a trustee or carrier (an "annuitant") and that any recourse against
the Fund/the Trust, the applicable trustees, Cinram International Inc.
or any unitholder or annuitant in any manner in respect of any
indebtedness, obligation or liability of the Fund/the Trust arising
hereunder or arising in connection herewith or from the matters to
which this Agreement relates, if any, including without limitation
claims based on negligence or otherwise tortious behaviour, shall be
limited to, and satisfied only out of, the assets of the Fund/Trust as
defined in the declaration of trust of the Fund/the Trust, as amended.
This provision shall be enforced by the Administrator for the benefit
of Unitholders and annuitants and/or the holders of Trust Units (and the Fund
Trustees and Trust Trustees), as the case may be. The omission of such a
provision from any such written agreement shall not operate to impose personal
liability on the Fund Trustees, the Trust Trustees, the Administrator, any
Unitholder or any annuitant or any holder of a Trust Unit.
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ARTICLE 3 - EXPENSES AND FEES
3.01 EXPENSES
The Administrator shall bear the cost of all Expenses (other than
Public Expenses) incurred in connection with the services provided by the
Administrator under this Agreement. The Administrator shall be reimbursed by the
Fund for any Public Expenses incurred by the Administrator. The Administrator
shall calculate the Public Expenses for each month and by the end of the 15th
day of the following month (or on such other basis determined by the parties,
provided that reimbursement shall not be less frequent than quarterly) shall
invoice the Fund and/or Trust, as applicable, by setting out of the details of
the services provided and the Public Expenses and GST incurred by the
Administrator in connection therewith. Such amounts shall be payable by the Fund
and/or the Trust, as the case may be, not later than 30 days after the delivery
of such invoice.
3.02 PAYMENT OF GST
Unless otherwise provided in this Agreement, all amounts payable to
the Administrator pursuant to this Agreement shall be exclusive of any GST to be
paid thereon and the Administrator shall be paid, in addition to such amounts,
all amounts of GST collectible by the Administrator with respect thereto and
such amounts shall be included by the Administrator in the invoice described in
Section 3.01.
3.03 FEE
The Fund and the Trust shall pay the Administrator an annual fee to be
mutually agreed upon by the parties, but in any event not to exceed $10,000 plus
GST thereon, for the services rendered by the Administrator pursuant to this
Agreement.
ARTICLE 4 - FINANCIAL STATEMENTS AND RECORDS
4.01 BOOKS AND RECORDS
The Administrator shall keep, at the Administrator's head office in
the Province of Ontario, proper books, records and accounts in which full, true
and correct entries in conformity with generally accepted accounting principles
and all requirements of applicable law will be made of all dealings and
transactions in relation to the activities of the Fund and the Trust and the
performance of the Administrator's services under this Agreement.
4.02 EXAMINATION OF RECORDS
The Administrator shall make available to the Fund Trustees and the
Trust Trustees and their respective authorized representatives at any time
during normal business hours on a Business Day all records, documents or
information related to the activities of the Fund and the Trust, wherever
maintained. The Administrator shall permit the Fund Trustees and the Trust
Trustees and their respective authorized representatives at any time during
normal business hours on a Business Day to examine the books, records, and
accounts, together with other supporting financial data pertaining to the
activities of the Fund and Trust maintained by the Administrator. Any
examination at the Administrator's head office shall be conducted in a manner
which will not unduly interfere with the conduct of the Administrator's business
in the ordinary course. The Administrator shall furnish to the Fund Trustees or
the Trust Trustees or their respective authorized representatives such documents
and information with respect to the activities of the Fund and the Trust,
respectively, as they shall from time to time reasonably request.
4.03 COMPLIANCE
If requested by the Fund Trustees, the Administrator shall deliver to
the Fund Trustees within 90 days after the end of a fiscal year a certificate
signed on behalf of the Administrator by the chief executive officer and the
chief financial officer of the general partner of the Administrator stating that
a review of the activities of the Administrator and the Fund during the
preceding fiscal year has been made under the supervision of such officers and
that, based on that review and their best knowledge, the Administrator has
fulfilled all of its obligations, and
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complied with all of the terms of, this Agreement in all material respects and
that no default hereunder (or event which, with notice or lapse of time or both,
could become a default hereunder) occurred during such fiscal year. The
Administrator shall contemporaneously deliver an analogous certificate to the
Trust Trustees in respect of the activities of the Trust during each such
period.
ARTICLE 5 - OBLIGATIONS AND COVENANTS OF THE FUND AND THE TRUST
5.01 OBLIGATIONS AND COVENANTS OF THE FUND AND TRUST
The Fund and the Trust shall each:
(a) grant access or cause access to be granted to the Administrator to the
documents and information necessary in order for the Administrator to
perform its obligations, covenants and responsibilities pursuant to
the terms hereof;
(b) provide, or cause to be provided, all documents and information as may
be reasonably requested by the Administrator, and promptly notify the
Administrator of any material facts or information of which it is
aware, in relation to and which may affect the performance of the
obligations, covenants or responsibilities of the Administrator
pursuant to this Agreement, including any known, pending or threatened
suits, actions, claims, proceedings or orders by or against the Fund,
the Trust or any of their respective subsidiaries before any court or
administrative tribunal; and
(c) otherwise cooperate reasonably with the Administrator in connection
with the performance of the services defined in Article 2 hereunder.
ARTICLE 6 - ACTIVITIES OF THE ADMINISTRATOR
6.01 STANDARD OF CARE AND DELEGATION
(a) In exercising its powers and discharging its duties under this
Agreement, the Administrator shall exercise the powers and discharge the duties
conferred hereunder honestly, in good faith and in what it believes is the best
interests of the Fund and the Trust and, in connection therewith, shall exercise
that degree of care, diligence and skill that a reasonably prudent administrator
having responsibilities of a similar nature would exercise in comparable
circumstances.
(b) Subject to the prior approval of the Fund Trustees or the Trust
Trustees of the delegation of any material obligations, which approval will not
be unreasonably withheld, the Administrator may delegate specific aspects of its
obligations hereunder to any other corporation or entity, provided that such
delegation shall not relieve the Administrator of any of its obligations under
this Agreement.
(c) Notwithstanding subsection 6.01(b), the Administrator shall not in any
manner, directly or indirectly, be liable or held to account for the activities
or inactivity of any person to which any such obligations may have been
delegated, provided that in making such specific delegation, the Administrator
acted in accordance with this Section 6.01. Where possible, the Administrator
will structure any delegation in a manner that will permit the Fund Trustees on
behalf of the Fund or the Trust Trustees on behalf of the Trust, as the case may
be, to bring an action directly against the delegatee.
6.02 RELIANCE
In carrying out its duties hereunder, the Administrator and its
delegates shall be entitled to rely on:
(a) statements of fact of other persons who are considered by the
Administrator, acting reasonably, to be knowledgeable of such facts;
and
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(b) statements, the opinion or advice of or information from any
solicitor, auditor, valuer, engineer, surveyor, appraiser or other
expert selected by the Administrator, provided that the Administrator
exercised reasonable care and diligence in selecting such person to
provide such statements, opinion, advice or information,
and may employ such experts as may be necessary to the proper discharge of its
duties.
The Administrator may rely, and shall be protected in acting, upon any
instrument or other documents believed by it to be genuine and in force.
6.03 NO LIABILITY FOR ADVICE
The Administrator shall not be liable, answerable or accountable to
the Fund, the Fund Trustees or any Unitholder, to the Trust, the Trust Trustees
or any holder of Trust Units, for any loss or damage resulting from, incidental
to or relating to the provision of services hereunder by the Administrator,
including any exercise or refusal to exercise a discretion or its refusal to
exercise a discretion, any mistake or error of judgment or any act or omission
believed by the Administrator to be within the scope of authority conferred on
it by this Agreement, unless such loss or damage resulted from the fraud, wilful
default or gross negligence of the Administrator in performing its obligations
hereunder.
ARTICLE 7 - INDEMNIFICATION
7.01 INDEMNIFICATION OF THE ADMINISTRATOR
The Administrator and any person who is serving or shall have served
as an employee of the Administrator or the general partner thereof shall be
indemnified and saved harmless by the Fund and the Trust (in each case in
relation to services provided in respect of or for the benefit of such party)
from and against all losses, claims, damages, liabilities, obligations, costs
and expenses (including judgments, fines, penalties, amounts paid in settlement
and counsel and accountants' fees) of whatsoever kind or nature incurred by,
borne by or asserted against any of such indemnified parties in any way arising
from or related in any manner to this Agreement or the provision of services
hereunder, unless such indemnified party is found liable for or guilty of fraud,
wilful default or gross negligence. The foregoing right of indemnification shall
not be exclusive of any other rights to which the Administrator or any person
referred to in this Section 7.01 may be entitled as a matter of law or equity or
which may be lawfully granted to such person.
7.02 INDEMNIFICATION OF THE FUND AND THE TRUST
The Fund, the Trust, the Fund Trustees, the Trust Trustees and any
person who is serving or shall have served as an officer or employee of the Fund
and/or the Trust shall be indemnified and saved harmless by the Administrator
from and against all losses, claims, damages, liabilities, obligations, costs
and expenses (including judgments, fines, penalties, amounts paid in settlement
and counsel and accountants' fees) of whatsoever kind or nature incurred by,
borne by or asserted against any of such indemnified parties in any way arising
from or related in any manner to the fraud, wilful default or gross negligence
of the Administrator in the performance of its obligations hereunder, unless
such losses, claims, damages, liabilities, obligations, costs and expenses
(including judgments, fines, penalties, amounts paid in settlement and counsel
and accountants' fees) arise from the fraud, wilful default or gross negligence
of such indemnified party. The foregoing right of indemnification shall not be
exclusive of any other rights to which the Fund, the Trust, the Fund Trustees,
the Trust Trustees, or any person referred to in this Section 7.02 may be
entitled as a matter of law or equity or which may be lawfully granted to such
person.
ARTICLE 8 - TERM
8.01 TERM
This Agreement shall become effective as of the date hereof and shall
continue in full force and effect until the tenth anniversary hereof (the
"TERM") and may otherwise only be terminated in the circumstances described in
Article 9. The Fund, the Trust and the Administrator shall have the option of
extending the Term of
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this Agreement for additional five-year periods by providing one another with 30
days' written notice of such extension prior to the expiration of the Term;
provided that the Fund, the Trust and the Administrator must jointly elect to so
extend this Agreement for the extension to be effective.
8.02 SURVIVAL
Any obligation of the parties pursuant to the terms hereof which
accrued prior to the termination of this Agreement and was intended to continue
after the termination of this Agreement shall survive the termination of this
Agreement.
ARTICLE 9 - TERMINATION
9.01 EVENTS OF TERMINATION BY THE FUND AND TRUST
The Fund and the Trust shall be in default under this Agreement upon
the occurrence of any of the following events, each of which shall be deemed to
be an event of termination with respect to the Fund and the Trust for the
purposes of this Agreement (a "FUND EVENT OF TERMINATION"):
(a) the Fund and/or the Trust breaches or fails to observe or perform any
of its material obligations under this Agreement and, within 30 days
after notice from the Administrator to such party specifying the
nature of such breach or failure, such party fails to cure such breach
or failure or to provide satisfactory evidence that such breach or
failure will be cured or remedied within a reasonable period of time
or after providing such satisfactory evidence thereafter fails to
diligently pursue such cure or remedy; and
(b) the Fund and/or the Trust (i) becomes Insolvent; (ii) is subject to
any proceeding, voluntary or involuntary, with a view to postponing or
rescheduling its debts generally or of distributing its assets among
its creditors under the provisions of the Bankruptcy and Insolvency
Act (Canada), the Companies Creditors' Arrangement Act (Canada), or
any other applicable laws for the benefit of creditors; (iii) is
liquidated; (iv) is wound up either voluntarily or under an order of a
court of competent jurisdiction; (v) makes a general assignment for
the benefit of its creditors; or (vi) otherwise takes any action that
acknowledges its Insolvency.
9.02 REMEDIES OF THE ADMINISTRATOR
Upon the occurrence of a Fund Event of Termination that has not been
remedied, the Administrator may, without recourse to legal process and without
limiting any other rights or remedies which it may have at law or otherwise,
immediately terminate this Agreement by delivery of a written notice of
termination to the Fund and to the Trust.
9.03 EVENTS OF TERMINATION BY THE ADMINISTRATOR
The Administrator shall be in default under this Agreement upon the
occurrence of any of the following events, each of which shall be deemed to be
an event of termination with respect to the Administrator (an "ADMINISTRATOR
EVENT OF TERMINATION") for the purposes of this Agreement:
(a) the Administrator breaches or fails to observe or perform any of the
Administrator's material obligations, covenants or responsibilities
under this Agreement and, within thirty (30) days after notice from
the Fund and/or the Trust specifying the nature of such breach or
failure, the Administrator fails to cure such breach or failure or to
provide satisfactory evidence that such breach will be cured or
remedied within a reasonable period of time or after providing such
satisfactory evidence thereafter fails to diligently pursue such cure
or remedy; and
(b) the Administrator (i) becomes Insolvent; (ii) is subject to any
proceeding, voluntary or involuntary, with a view to postponing or
rescheduling its debts generally or of distributing its assets among
its creditors under the provisions of the Bankruptcy and Insolvency
Act (Canada), the
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Companies Creditors' Arrangement Act (Canada), or any other applicable
laws for the benefit of creditors; (iii) is liquidated; (iv) is wound
up either voluntarily or under an order of a court of competent
jurisdiction; (v) makes a general assignment for the benefit of its
creditors; or (vi) otherwise takes any action that acknowledges its
Insolvency.
9.04 REMEDIES OF THE FUND AND TRUST
Upon the occurrence of the Administrator Event of Termination that has
not been remedied, the Fund and/or the Trust may, without recourse to legal
process and without limiting any other rights or remedies it may have at law or
otherwise, immediately terminate this Agreement by delivery of a written notice
of termination to the Administrator.
9.05 POST TERMINATION ARRANGEMENTS
In the event of a termination of this Agreement:
(a) the Administrator shall deliver to each of the Fund and the Trust,
respectively, all books, records, accounts, documents, systems and
manuals which it has developed and maintained relating to it pursuant
to this Agreement; and
(b) the parties shall take all steps as may be reasonably required to
complete any final accounting between them and to provide, if
applicable, for the completion of any other matter contemplated by
this Agreement.
ARTICLE 10 - FORCE MAJEURE
10.01 CONSEQUENCES OF FORCE MAJEURE
During the occurrence of an event of Force Majeure, the obligations of
the party affected by such event of Force Majeure, to the extent that such
obligations cannot be performed as a result of such event of Force Majeure,
shall be suspended, and such party shall not be considered to be in breach or
default hereunder, for the period of such occurrence. The suspension of
performance shall be of no greater scope and of no longer duration than is
required by the event of Force Majeure. No obligation of either party that arose
prior to the event of Force Majeure causing the suspension of performance shall
be excused as a result of the event of Force Majeure.
10.02 NOTICE
The non-performing party (i) shall give the other party prompt written
notice of the particulars of the event of Force Majeure and its expected
duration, and (ii) shall use its best efforts to remedy its inability to
perform.
ARTICLE 11 - MISCELLANEOUS
11.01 NO PARTNERSHIP, JOINT VENTURE, AGENCY OR TRUST
The parties are not and shall not be deemed to be partners or joint
venturers with one another and nothing herein shall be construed so as to impose
any liability as such on any of them. The parties agree that the Administrator
shall perform its obligations under this Agreement as an independent contractor
and shall not be, and shall not be deemed to be, a trustee for any person,
whether or not a party, in connection with the discharge by the Administrator of
such obligations.
11.02 AMENDMENTS
This Agreement shall not be amended or varied in its terms by oral
agreement or by representations or otherwise except by instrument in writing
executed by the duly authorized representatives of the parties hereto or their
respective successors or assigns.
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11.03 SUCCESSORS AND ASSIGNS
The provisions of this Agreement shall enure to the benefit of, and be
binding upon, the parties hereto and their respective successors and permitted
assigns. This Agreement may be assigned by any party hereto only with the prior
written consent of the other party. Any corporation or entity resulting from a
merger, consolidation or amalgamation to which a party to this Agreement may be
a party or which succeeds to the business of a party or to which substantially
all of the assets of the party may be transferred shall be the successor of that
party without any further act or formality with like effect as if such successor
company has been originally named hereunder.
11.04 SEVERABILITY
The provisions of this Agreement are severable. In the event of the
unenforceability or invalidity of any one or more of the terms, covenants,
conditions or provisions of this Agreement under applicable law, such
unenforceability or invalidity shall not render any of the other terms,
covenants, conditions or provisions hereof unenforceable or invalid; and the
parties agree that this Agreement shall be construed as if such an unenforceable
or invalid term, covenant or condition was never contained herein.
11.05 NOTICES
All notices required or permitted herein under this Agreement shall be
in writing and may be given by delivering or faxing same during normal business
hours to the address set forth below. Any such notice or other communication
shall, if delivered, be deemed to have been given or made and received on the
date delivered, and if faxed (with confirmation received), shall be deemed to
have been given or made and received on the day on which it was so faxed. The
parties hereto may give from time to time written notice of change of address in
the manner aforesaid.
To the Administrator:
Cinram International Inc.
0000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attn: Chief Financial Officer
Fax: 000-000-0000
To the Fund:
Cinram International Income Fund
0000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attn: Board of Trustees
Fax: 000-000-0000
To the Trust:
CII Trust
0000 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attn: Board of Trustees
Fax: 000-000-0000
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11.06 GOVERNING LAW
The provisions of this Agreement shall be governed by and interpreted
in accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein.
11.07 FURTHER ASSURANCES
Each party hereto agrees to execute any and all documents and to
perform such other acts as may be necessary or expedient to further the purposes
of this Agreement and the transactions contemplated hereby.
11.08 TIME OF ESSENCE
Time shall be of the essence in respect of this Agreement.
11.09 ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the parties
hereto, and supersedes all prior agreements, in respect of the subject matter
hereof.
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IN WITNESS WHEREOF the parties hereto have executed this Agreement by
their proper officers duly authorized in that behalf as of the day and year
first above written.
CINRAM INTERNATIONAL INC.
By: "Xxxxx Xxxxxxx"
-----------------------------------
Authorized Signatory
CINRAM INTERNATIONAL INCOME FUND
By: "Xxxxx X. Xxxxx"
------------------------------------
Authorized Signatory
CII TRUST
By: "Xxxxx X. Xxxxx"
------------------------------------
Authorized Signatory
