Exhibit 10.30
EXECUTION COPY
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UNDERWRITING AGREEMENT
March 17, 2006
Supremex Income Fund
Supremex Inc.
0000 Xxxxxxx
Xxxxxxx, Xxxxxx
Xxxxxx
X0X 0X0
Cenveo, Inc.
Cenveo Corporation
One Canterbury Green
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx
Xxxxxx Xxxxxx of America
06901
The undersigned, TD Securities Inc., CIBC World Markets Inc., BMO Xxxxxxx
Xxxxx Inc., Desjardins Securities Inc., National Bank Financial Inc., Scotia
Capital Inc., Canaccord Capital Corporation and Genuity Capital Markets G.P.
(collectively, the "Underwriters" and each individually an "Underwriter")
understand that Supremex Income Fund (the "Fund") proposes to issue and sell
to the Underwriters 17,500,000 trust units of the Fund (the "Purchased
Units"), which Purchased Units shall have the material attributes described
in and contemplated by the Final Prospectus (as defined below) dated March
17, 2006 and executed concurrently with the execution of this Agreement.
The Underwriters propose to distribute the Purchased Units in Canada
pursuant to the Final Prospectus and in the United States pursuant to a U.S.
Private Placement Memorandum for the private placement of the Purchased
Units in the United States in accordance with Rule 144A (as defined below),
all in the manner contemplated by this Agreement.
Based on the foregoing, and subject to the terms and conditions contained in
this Agreement, the Underwriters, jointly and not solidarily, on the basis
of the percentages set forth in section 19 of this Agreement, agree to
purchase from the Fund and by its acceptance hereof, the Fund agrees to sell
to the Underwriters, the Purchased Units on the Closing Date (as defined
below) at a price of $10.00 per Purchased Unit for all but not less than all
of the Purchased Units (the "Purchase Price"), representing an aggregate
purchase price of $175,000,000.
By acceptance of this Agreement, the Fund grants to the Underwriters an
unassignable right to purchase, jointly and not solidarily, up to 2,500,000
additional Units (the "Additional Units") on the same basis as the purchase
of the Purchased Units to cover over-allotments made in connection with the
offering of the Purchased Units, if any, and for market stabilization
purposes, and the Fund covenants and agrees to do all such acts and things
as may be required or advisable in order for such right to be exercisable in
the manner described in the Prospectus (defined below). If TD Securities
Inc. and CIBC World Markets Inc. (together, the "Lead Underwriters"), on
behalf of the Underwriters, elect to exercise such right, the Lead
Underwriters shall notify the Fund in writing, which notice shall specify
the number of
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Additional Units to be purchased by the Underwriters and the date on which
such Additional Units are to be purchased, which date may be the same as the
Closing Date but not earlier than the Closing Date and shall not be later
than 30 days after the Closing Date. Such date shall not be earlier than
three Business Days (as defined below) nor later than five Business Days
after the date of such notice. If any Additional Units are purchased, each
Underwriter agrees, jointly and not solidarily, to purchase that number of
Additional Units (subject to such adjustments to eliminate fractional units
as Lead Underwriters may determine) equal to the total number of Additional
Units to be purchased multiplied by the percentage set out in section 19 of
this Agreement opposite the name of such Underwriter.
The Purchased Units and the Additional Units are hereinafter collectively
referred to as the "Units".
In consideration of the Underwriters' agreement to purchase the Units which
will result from the acceptance by the Fund of this offer, and in
consideration of the services to be rendered by the Underwriters in
connection therewith, the Fund agrees to cause AcquisiCo to pay to the
Underwriters a fee of $0.55 per Unit (the "Underwriting Fee"). Such
Underwriting Fee shall be due and payable at the Closing Time (as defined
below) against payment for the Purchased Units and, if applicable, at the
Option Closing Time (as defined below), against payment for the Additional
Units, as the case may be.
DEFINITIONS
In this Agreement:
"1933 ACT" means the United States Securities Act of 1933, as
amended;
"1934 ACT" means the United States Securities Exchange Act of 1934,
as amended;
"ACQUISICO" means 4273681 Canada Inc.;
"ACQUISITION AGREEMENT" means the acquisition agreement dated as of
the date hereof among the Fund, Cenveo US and Cenveo providing for,
among other things, the completion of the transactions described
under the heading "Funding and Related Transactions -Closing
Transactions" in the Prospectus;
"ADDITIONAL UNITS" has the meaning given to it above;
"AFFILIATE" has the meaning given to it in the Securities Act
(Quebec);
"AGREEMENT" means the agreement resulting from the acceptance by
the Fund of the offer made by the Underwriters by this letter;
"AMALCO" means (i) prior to the Closing, the corporation to result
from the amalgamation of Supremex and Cenveo Canada, and (ii) on
and after the Closing, the corporation to result from the
amalgamation of the corporation referred to in (i) with AcquisiCo;
"AMENDED PRELIMINARY PROSPECTUS" means the amended and restated
preliminary long form prospectus dated February 24, 2006 (in both
the English and French languages
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unless the context indicates otherwise) amending and restating as
of such date the Preliminary Prospectus;
"BUSINESS" means the business of the Material Subsidiaries as
conducted immediately prior to the Closing consisting of the
manufacturing and marketing of a broad range of stock and custom
envelopes and related products;
"BUSINESS DAY" means any day, other than a Saturday or Sunday, on
which TD Canada Trust and the Canadian Imperial Bank of Commerce,
in Montreal, Quebec are both open for commercial banking business
during normal banking hours;
"CANADIAN SECURITIES LAWS" means all applicable securities laws in
each of the Qualifying Provinces and the respective rules,
regulations, blanket orders and blanket rulings under such laws
together with applicable published policies, policy statements and
notices of the securities regulatory authorities in the Qualifying
Provinces;
"CANADIAN SECURITIES REGULATORS" means the applicable securities
commission or securities regulatory authority in each of the
Qualifying Provinces;
"CBCA" means the Canada Business Corporations Act and the
regulations thereunder, as amended;
"CDS" means the Canadian Depository for Securities Limited;
"CENVEO" means Cenveo, Inc.;
"CENVEO CANADA" means Cenveo Canada Leasing Company, Inc.;
"CENVEO DEPEW ACQUISITION AGREEMENT" means the asset purchase
agreement among Cenveo, Cenveo US, the Fund, AcquisiCo and Buffalo
Envelope Inc. and to be entered on the Closing Date providing for,
among other things, the acquisition by Buffalo Envelope Inc. of
certain assets, and the assumption of certain liabilities, in each
case of a division of Cenveo US that is engaged in the business of
providing envelopes and related products directly to consumers and
to direct mail marketing agents within the upstate New York and
northwest Pennsylvania markets;
"CENVEO US" means Cenveo Corporation;
"COST SUPPORT AGREEMENT" means the cost support agreement entered
into on or prior to Closing among the Fund and AcquisiCo with
respect to the payment by AcquisiCo of certain Offering and related
costs;
"CLAIM" has the meaning given to it in section 15(a);
"CLOSING" means the completion of the issue and sale by the Fund of
the Purchased Units and the purchase by the Underwriters of the
Purchased Units pursuant to this Agreement;
"CLOSING DATE" means March 31, 2006 or such other date as the Fund
and the Underwriters may agree upon in writing or as may be changed
pursuant to section 7 but in any event shall not be later than
April 29, 2006;
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"CLOSING TIME" means 8:00 a.m. (Eastern time) on the Closing Date;
"CLOSING TRANSACTIONS" means the transactions described under the
heading "Funding and Related Transactions - Closing Transactions"
in the Prospectus;
"DISTRIBUTION" means a distribution for the purposes of Canadian
Securities Laws or any of them;
"FINAL MRRS DECISION DOCUMENT" means the decision document issued
pursuant to NP 43-201 evidencing the issuance by the Canadian
Securities Regulators of a receipt for the Final Prospectus in
accordance with NP 43-201;
"FINAL PROSPECTUS" means the (final) long form prospectus dated
March 17, 2006 (in both the English and French languages unless the
context indicates otherwise), prepared by the Fund and relating to
the distribution of the Purchased Units;
"FINANCIAL INFORMATION" means, collectively, the information
appearing in the English language version of the Preliminary
Prospectus, the Amended Preliminary Prospectus, and the Final
Prospectus (a) under the heading "Definition of EBITDA, Adjusted
EBITDA and Distributable Cash", (b) under the heading "Prospectus
Summary - Selected Consolidated Financial Information"; (c) under
the heading "Prospectus Summary - Summary Analysis of Distributable
Cash"; (d) under the heading "Selected Consolidated Financial
Information"; (e) under the heading "Summary Analysis of
Distributable Cash" (f) under the heading "Reconciliation of EBITDA
and Adjusted EBITDA to Historical Results"; (g) under the heading
"Consolidated Capitalization of the Fund"; (h) under the heading
"Management's Discussion and Analysis of Financial Condition and
Results of Operation of the Business"; and (i) under the heading
"Auditors' Consent", together with all non-GAAP financial
information (including, without limitation, EBITDA, Adjusted EBITDA
and distributable cash) set forth in the Prospectus;
"FINANCIAL STATEMENTS" means the audited balance sheet of the Fund
as at February 10, 2006, the audited consolidated financial
statements of Supremex for the years ended December 31, 2005, 2004
and 2003, and the unaudited pro forma consolidated financial
statements of the Fund included in the Prospectus, including all
notes thereto and the auditor's report on such audited financial
statements, as applicable;
"FUND" has the meaning given to it above;
"FUND DECLARATION OF TRUST" means the declaration of trust made as
of February 10, 2006, governed under the laws of Quebec, pursuant
to which the Fund was established, as amended, supplemented or
restated from time to time;
"GAAP" means Canadian generally accepted accounting principles;
"GUARANTEES" means collectively the guarantees by Supremex, Cenveo
Canada, PNG Inc. and Innova Envelope Inc., as applicable, of the
obligations of Cenveo and its affiliates and related security
interests granted by such guarantors in support thereof under: (a)
the US$300 million senior secured credit facility of Cenveo with a
group of banks which matures in June 2008, (b) the note indenture
pursuant to which the US$320
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million of 7-7/8% senior subordinated notes of Cenveo due 2013 were
issued, (c) the note indenture pursuant to which the US$350 million
9-5/8% senior notes of Cenveo due 2012 were issued, and (d) any
agreement or instrument ancillary to the agreements referred to in
(a), (b) or (c) above;
"INDEMNIFIED PARTY" has the meaning given to it in section 15(a);
"INDEMNIFIER" has the meaning given to it in section 15(a);
"INITIAL NOTES" means the unsecured notes issued by the Fund to
Cenveo US in consideration for all of the shares of Amalco;
"LEAD UNDERWRITERS" has the meaning given to it above;
"MANAGEMENT UNITS" means the 2,364,228 trust units of the Fund to
be issued to certain management employees of Supremex in accordance
with the Subscription and Escrow Agreement;
"MATERIAL CHANGE" means a material change for the purposes of
Canadian Securities Laws or, where undefined under applicable
Canadian Securities Laws, means a change in the business,
operations or capital of the Fund, Supremex or Amalco that would
reasonably be expected to have a significant effect on the market
price or value of the Units and includes a decision to implement
such a change made by the board of Trustees of the Fund, the board
of directors or, alternatively, by senior management of Supremex or
Amalco, as applicable, where they believe that confirmation of the
decision by the board of directors of Supremex or Amalco, as
applicable, is probable;
"MATERIAL FACT" means a material fact for the purposes of Canadian
Securities Laws or, where undefined under applicable Canadian
Securities Laws, means a fact that significantly affects or would
reasonably be expected to have a significant effect on the market
price or value of the Units;
"MATERIAL SUBSIDIARIES" means Supremex, Cenveo Canada, Amalco,
AcquisiCo and Buffalo Envelope Inc., except where this term is used
in section 5(b) where "Material Subsidiaries" shall exclude Cenveo
Canada, and "MATERIAL SUBSIDIARY" means any one of them;
"MISREPRESENTATION" means a misrepresentation for the purposes of
Canadian Securities Laws or, where undefined under applicable
Canadian Securities Laws, means any untrue statement of a material
fact or an omission to state a material fact that is required to be
stated or that is necessary to make a statement not misleading in
the light of the circumstances in which it was made;
"MRRS" means the Mutual Reliance Review System;
"NP 43-201" means National Policy 43-201 - Mutual Reliance Review
System for Prospectuses and Annual Information Forms adopted by the
Canadian Securities Regulators and its related memorandum of
understanding;
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"NEW CREDIT FACILITIES" means the credit facilities to be
established in favour of AcquisiCo on Closing as described in the
Prospectus under "New Credit Facilities";
"NON-SOLICITATION AGREEMENT" means the non-solicitation agreement
among the Fund, Amalco, Cenveo US and Cenveo to be entered on the
Closing Date as described in the Prospectus under "Business of
Supremex - Relationship with Cenveo";
"NOTE INDENTURE" means the note indenture to be entered into on or
prior to Closing between AcquisiCo and Computershare Investor
Services Inc., as trustee thereunder, pursuant to which Supremex
will issue Notes, as amended, supplemented or restated from time to
time;
"NOTES" means the unsecured notes issued by AcquisiCo or Amalco
from time to time in accordance with the Note Indenture;
"NOTICE" has the meaning given to it in section 24;
"OPTION CLOSING" means completion of the sale by the Fund of the
Additional Units and the purchase by the Underwriters of the
Additional Units pursuant to this Agreement;
"OPTION CLOSING DATE" means the date for the Option Closing set out
in the notice of exercise of the over-allotment option provided by
the Underwriters to the Fund or on such other date as the
Underwriters and the Fund may agree, but in no case later than
April 29, 2006;
"OPTION CLOSING TIME" means 8:00 a.m. (Eastern time) on the Option
Closing Date or such other time on the Option Closing Date as may
be agreed to by the Fund and the Underwriters;
"OVER-ALLOTMENT NOTE" means the promissory note of the Fund in
favour of Cenveo US, substantially in the form attached to the
Acquisition Agreement, in the amount of $23,625,000, the terms of
which shall provide, among other things, that such note is
repayable as follows and cannot be repaid otherwise than as
follows: (i) by the issuance of units of the Fund, (ii) in cash
representing the net issue price of the units of the Fund to be
issued upon exercise of the over-allotment option, or (iii) a
combination of (i) and (ii);
"PRELIMINARY PROSPECTUS" means the preliminary long form prospectus
dated February 15, 2006 (in both the English and French languages
unless the context indicates otherwise) prepared by the Fund
relating to the distribution of the Units;
"PRELIMINARY U.S. PLACEMENT MEMORANDUM" means the preliminary U.S.
private placement memorandum of the Fund dated February 24, 2006
for the placement of the Units in the United States in accordance
with Rule 144A;
"PROSPECTUS" means, collectively, the Preliminary Prospectus, the
Amended Preliminary Prospectus and the Final Prospectus;
"PROSPECTUS AMENDMENT" means any amendment to the Preliminary
Prospectus, the Amended Preliminary Prospectus or the Final
Prospectus;
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"PURCHASE PRICE" has the meaning given to it above;
"PURCHASED UNITS" has the meaning given to it above;
"QUALIFYING PROVINCES" means all of the provinces of Canada;
"QUALIFYING STATES" means each of the U.S. States into which the
Purchased Units are offered or sold;
"REGISTRATION RIGHTS AGREEMENT" means the registration rights
agreement to be entered into on or prior to Closing among the Fund
and Cenveo US as described in the Prospectus under "Funding and
Related Transactions - Registration Rights";
"RELATED AGREEMENTS" means the Fund Declaration of Trust, the Note
Indenture, the Notes, the Initial Notes, the Over-Allotment Note,
the Acquisition Agreement, the Tax Escrow Agreement, the New Credit
Facilities, the Supply Agreement, the Non-Solicitation Agreement,
the Cenveo Depew Acquisition Agreement, the Subscription and Escrow
Agreement, the Registration Rights Agreement and the Cost Support
Agreement;
"REGULATION S" means Regulation S under the 1933 Act;
"RULE 144A" means Rule 144A under the 1933 Act;
"SEC" means the United States Securities Exchange Commission;
"SELLING FIRM" has the meaning given to it in section 3;
"SUBSCRIPTION AND ESCROW AGREEMENT" means the subscription and
escrow agreement described under the heading "Executive
Compensation - Management Profit Sharing Plan" in the Prospectus;
"SUBSIDIARY" has the meaning given to it in the Securities Act
(Quebec);
"SUPPLY AGREEMENT" means the product supply agreement among the
Fund, Amalco and Cenveo to be entered on the Closing Date as
described in the Prospectus under "Business of Supremex -
Relationship with Cenveo";
"SUPREMEX" means Supremex Inc.;
"TAX ESCROW AGREEMENT" means the escrow agreement to be entered
into on or prior to Closing among Cenveo US, the Fund and TD Trust
Company., as escrow agent;
"TRANSFER AGENT" means Computershare Investor Services Inc.;
"TRUSTEES" means the trustees of the Funds, appointed from time to
time;
"TSX" means the Toronto Stock Exchange;
"UNDERWRITER" and "UNDERWRITERS" have the respective meanings given
to them above;
"UNDERWRITING FEE" has the meaning given to it above;
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"UNITS" has the meaning given to it above;
"U.S. PLACEMENT MEMORANDUM" means the private placement memorandum
of the Fund dated March 17, 2006 for the placement of the Units in
the United States in accordance with Rule 144A; and
"U.S. SECURITIES LAWS" means all applicable securities laws of the
United States including, but not limited to, the 1933 Act and the
1934 Act and including the state securities laws of each of the
U.S. States in which the Units are offered and the respective
rules, regulations, orders and rulings under such laws, together
with applicable published policies, policy statements and notices
of the securities regulatory authorities in the United States and
in each of the U.S. States.
Unless otherwise expressly provided in this Agreement, words importing only
the singular number include the plural and vice versa and words importing
gender include all genders. Reference to "Sections" or "Clauses" are to the
appropriate section or clause of this Agreement.
The parties acknowledge that this Agreement is being executed on behalf of
the Fund by its trustee and that the obligations of the Fund hereunder shall
not be binding upon any of the trustees of the Fund personally or on any
unitholder of the Fund in any manner whatsoever in respect of any
indebtedness, obligation or liability of the Fund 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,
which shall be limited to, and satisfied only, out of the Trust Assets (as
defined in the Fund Declaration of Trust).
All references to dollars or "$" are to Canadian dollars unless otherwise
expressed.
TERMS AND CONDITIONS
1. COMPLIANCE WITH SECURITIES LAWS
The Fund represents and warrants to, and covenants and agrees with, the
Underwriters that the Fund has prepared and filed the Preliminary Prospectus
and the Amended Preliminary Prospectus and has obtained pursuant to NP
43-201 a MRRS decision document evidencing the issuance by the Canadian
Securities Regulators of receipts for each of the Preliminary Prospectus and
the Amended Preliminary Prospectus. The Fund will promptly and, in any event
no later than the Business Day after the execution and delivery of this
Agreement, prepare and file a Final Prospectus and will obtain the Final
MRRS Decision Document. The Fund will promptly fulfil and comply with, to
the reasonable satisfaction of the Underwriters, the Canadian Securities
Laws required to be fulfilled or complied with by the Fund to enable the
Units to be lawfully distributed to the public in the Qualifying Provinces
through the Underwriters or any other investment dealers or brokers
registered as such in the Qualifying Provinces.
2. DUE DILIGENCE
Prior to the filing of each of the Preliminary Prospectus and the Amended
Preliminary Prospectus the Fund has, and prior to the filing of the Final
Prospectus the Fund shall, permit the Underwriters to review each of the
Preliminary Prospectus, the Amended Preliminary Prospectus and the Final
Prospectus and shall allow each of the Underwriters to conduct any due
diligence
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investigations which any of them reasonably requires in order to fulfil its
obligations as an underwriter under the Canadian Securities Laws and U.S.
Securities Laws and in order to enable it to responsibly execute the
certificate in the Preliminary Prospectus, the Amended Preliminary
Prospectus and the Final Prospectus required to be executed by it. Following
the filing of the Final Prospectus and up to the later of the Closing Date
and the date of completion of the distribution of the Units, the Fund shall
allow each of the Underwriters to conduct any due diligence investigations
which any of them reasonably requires.
3. DISTRIBUTION AND CERTAIN OBLIGATIONS OF THE UNDERWRITERS
(a) Each of the Underwriters shall, and shall require any
investment dealer or broker, other than the Underwriters,
with which it has a contractual relationship in respect of
the distribution of the Units (a "Selling Firm"), to
comply with the Canadian Securities Laws in connection
with the distribution of the Units in Canada and shall
offer the Units for sale to the public in Canada directly
and through Selling Firms upon the terms and conditions
set out in the Prospectus and this Agreement. Each of the
Underwriters shall, and shall require any Selling Firm to,
offer for sale to the public and sell the Units only in
those jurisdictions where they may be lawfully offered for
sale or sold. The Underwriters shall not, without the
consent of the Fund, distribute the Units outside Canada
and the United States.
(b) Each of the Underwriters shall, and shall require any
Selling Firm to agree to, distribute the Units in Canada
and in the United States in a manner which complies with
and observe all applicable laws and regulations (including
Rule 144A and Regulation S) in each jurisdiction into and
from which they may offer to sell the Units or distribute
the Prospectus or any Prospectus Amendment in connection
with the distribution of the Units and will not, directly
or indirectly, offer, sell or deliver any Units or deliver
the Prospectus or any Prospectus Amendment to any person
in any jurisdiction other than in the Qualifying Provinces
and the Qualifying States except in a manner which will
not require the Fund to violate any law or comply with the
registration, prospectus, filing or other similar
requirements under the applicable securities laws of such
other jurisdictions.
(c) For the purposes of this section 3, each of the
Underwriters shall be entitled to assume that the Units
are qualified for distribution in any Qualifying Province
where a receipt or similar document for the Prospectus
shall have been obtained from the applicable securities
commission following the filing of the Prospectus, and
none of the Underwriters shall be liable in respect of or
in relation to any of the other Underwriters' performance
of their obligations pursuant to this section 3 or
Schedule A.
(d) The Fund and the Underwriters agree that Schedule A to
this Agreement, entitled "Rule 144A Sales in the United
States", is incorporated by reference in and shall form
part of this Agreement.
(e) The Underwriters shall cause the distribution of the Units
to occur in such a manner that less than 49% of the units
are purchased by Non-Residents (as defined in the Fund
Declaration of Trust) and shall, upon the reasonable
request
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of the Fund, provide the Fund with a certificate
specifying the number of Units purchased by Non-Residents
pursuant to such distribution.
4. DELIVERY OF DOCUMENTS
(a) DELIVERIES ON FILING
On or prior to the day of the filing of the Final Prospectus, the Fund shall
deliver to each of the Underwriters:
(i) a copy of each of the Preliminary Prospectus, the
Amended Preliminary Prospectus and the Final
Prospectus in the English language signed and
certified as required by the Canadian Securities
Laws in the Qualifying Provinces other than
Quebec;
(ii) a copy of each of the Preliminary Prospectus, the
Amended Preliminary Prospectus and the Final
Prospectus in the French language signed and
certified as required by the Canadian Securities
Laws applicable in Quebec;
(iii) a copy of any other document required to be filed
along with the Prospectus by the Fund under the
Canadian Securities Laws;
(iv) a copy of the Preliminary U.S. Placement
Memorandum and the U.S. Placement Memorandum;
(v) opinions of Stikeman Elliott LLP, dated the date
of each of the Preliminary Prospectus, the
Amended Preliminary Prospectus and the Final
Prospectus, respectively, in form and substance
satisfactory to the Underwriters, Cenveo and
Cenveo US and their counsel, acting reasonably,
addressed to the Underwriters, their counsel, the
Fund, the Trustees, Cenveo and Cenveo US to the
effect that the French language version of each
of the Preliminary Prospectus, the Amended
Preliminary Prospectus and the Final Prospectus,
except for the Financial Statements and Financial
Information, as to which no opinion need be
expressed by such counsel, is, in all material
respects, a complete and proper translation of
the English language version thereof;
(vi) opinions of Ernst & Young LLP dated the date of
each of the Preliminary Prospectus, the Amended
Preliminary Prospectus and the Final Prospectus,
respectively, in form and substance satisfactory
to the Underwriters, Cenveo and Cenveo US and
their counsel, acting reasonably, addressed to
the Underwriters, their counsel, the Fund, the
Trustees, Cenveo and Cenveo US to the effect that
the French language version of the Financial
Statements and the Financial Information
contained in each of the Preliminary Prospectus,
the Amended Preliminary Prospectus and the Final
Prospectus is, in all material respects, a
complete and proper translation of the English
language version thereof; and
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(vii) a "long-form" comfort letter of Ernst & Young
LLP, dated the date of the Final Prospectus (with
the requisite procedures to be completed by such
auditors within two Business Days of the date of
the Final Prospectus), addressed to the
Underwriters, the Trustees, Cenveo and Cenveo US
in form and substance satisfactory to the
Underwriters, Cenveo and Cenveo US, acting
reasonably, with respect to certain financial and
accounting information relating to the Fund,
Supremex and the Business in the Final
Prospectus, which letter shall be in addition to
the auditors' report contained in the Final
Prospectus and the auditors' comfort letters
addressed to the Canadian Securities Regulators.
(b) PROSPECTUS AMENDMENTS
In the event that the Fund is required by Canadian Securities Laws to
prepare and file a Prospectus Amendment, the Fund shall prepare and deliver
promptly to the Underwriters signed and certified copies of such Prospectus
Amendment in the English and French language. Any Prospectus Amendments
shall be in form and substance satisfactory to the Underwriters and their
counsel. Concurrently with the delivery of any Prospectus Amendments, the
Fund shall deliver to the Underwriters (and Cenveo and Cenveo US in the case
of sections 4(a)(vi) and (vii)), with respect to such Prospectus Amendment,
documents similar to those referred to in sections 4(a)(iii), (a)(iv),
(a)(v), (a)(vi) and (a)(vii). Subject to their rights under Section 15, the
Underwriters agree to deliver a copy of any Prospectus Amendment to each
purchaser of Units from the Underwriters.
In addition to the matters set forth above in this section 4 and in section
9, the Fund shall, in good faith, discuss with the Underwriters any change,
event or fact contemplated in those sections that is of a nature that there
may be reasonable doubt as to whether notice should be given to the
Underwriters under section 9 and shall consult with the Underwriters with
respect to the form and content of any Prospectus Amendment, it being
understood and agreed that no such Prospectus Amendment shall be filed with
any Canadian Securities Regulator prior to being reviewed by the
Underwriters and their counsel.
(c) COMMERCIAL COPIES
The Fund shall cause commercial copies of the Final Prospectus in the
English and French languages and the U.S. Placement Memorandum to be
delivered to the Underwriters without charge, in such quantities and in such
cities as the Underwriters may reasonably request to the printer of such
documents. Such delivery of the Final Prospectus shall be effected as soon
as possible after filing thereof with, and receipt of a MRRS decision
document therefor from, the Canadian Securities Regulators but, in any
event, on or before 5:00 p.m. (Eastern time) on the second Business Day
following filing of the Final Prospectus. Such deliveries shall constitute
the consent of the Fund to the Underwriters' use of the Final Prospectus and
the U.S. Placement Memorandum for the distribution of the Units in the
Qualifying Provinces and the Qualifying States in compliance with the
provisions of this Agreement, Canadian Securities Laws and U.S. Securities
Laws. The Fund shall similarly cause to be delivered commercial copies of
any Prospectus Amendments. The commercial copies of the Final Prospectus
shall be identical in content to the electronically transmitted versions
thereof filed with Canadian Securities Regulators pursuant to the System for
Electronic Document Analysis and Retrieval.
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(d) PRESS RELEASES
During the period commencing on the date hereof and until completion of the
distribution of the Units, the Fund will promptly provide the Underwriters
drafts of any press releases of the Fund for review by the Underwriters and
their counsel prior to issuance; the Underwriters covenant to use best
efforts to complete such review in a timely and reasonable manner.
5. REPRESENTATIONS AND WARRANTIES
(a) REPRESENTATIONS AS TO PROSPECTUS AND PROSPECTUS AMENDMENTS
Filing of each of the Preliminary Prospectus, the Amended Preliminary
Prospectus, the Final Prospectus and any Prospectus Amendment shall
constitute a representation and warranty by the Fund and Supremex solidarily
to the Underwriters that as at their respective dates and as at the date of
filing of each of the Preliminary Prospectus, Amended Preliminary
Prospectus, Final Prospectus and any Prospectus Amendment, as applicable:
(i) all information and statements (other than
information and statements relating solely to the
Underwriters which was provided by the
Underwriters in writing specifically for use in
the Preliminary Prospectus, Amended Preliminary
Prospectus, Final Prospectus or any Prospectus
Amendment) contained in the Preliminary
Prospectus, Amended Preliminary Prospectus, Final
Prospectus and any Prospectus Amendment are true
and correct in all material respects and contain
no misrepresentation and constitute full, true
and plain disclosure of all material facts
relating to the Fund, Supremex, the Business and
the Units;
(ii) no material fact (other than facts relating
solely to the Underwriters) has been omitted from
such disclosure that is required to be stated in
such disclosure or is necessary to make the
statements contained in such disclosure not
misleading in light of the circumstances under
which they were provided or made; and
(iii) such documents, comply with the requirements of
Canadian Securities Laws.
Such filings shall also constitute the Fund's consent to the Underwriters'
use of the Final Prospectus and any Prospectus Amendment in connection with
the distribution of the Units in the Qualifying Provinces in compliance with
this Agreement and Canadian Securities Laws.
(b) REPRESENTATIONS AND WARRANTIES OF THE FUND AND SUPREMEX
The Fund and Supremex solidarily represent and warrant to the Underwriters
that, and acknowledge that the Underwriters are relying upon such
representations and warranties in purchasing the Units, if any:
(i) the Fund is an unincorporated open-ended trust
established under the laws of the Province of
Quebec pursuant to the Fund Declaration of Trust
and the Trustees, acting in their capacity as
trustees of the Fund, have all
- 13 -
necessary power and authority to administer, control
and hold title to the Fund's assets and execute the
Fund's undertaking, and to enter into and perform
the Fund's obligations under this Agreement and
each of the Related Agreements to which it is a
party;
(ii) Xxxxxx Xxx is, as of the date hereof, the sole
Trustee of the Fund and, upon Closing, the
persons identified as Trustees in the Prospectus
will have been duly appointed as trustees;
(iii) (A) immediately prior to Closing and completion
of the Closing Transactions, the Fund's
authorized capital consists of an unlimited
number of Units of which 10 Units are issued and
outstanding as of the date hereof; (B)
immediately following Closing, assuming the
over-allotment option has not been exercised,
there will be 31,311,667 Units issued and
outstanding; (C) except for the over-allotment
option, no person, firm or corporation has any
agreement or option, or right or privilege
(whether pre-emptive or contractual) capable of
becoming an option or other agreement for the
purchase from the Fund of any unissued Units or
other securities of the Fund; and (D) immediately
following Closing, the Fund will not hold
interests in any other entity other than the
Material Subsidiaries;
(iv) each of the Material Subsidiaries (other than
Amalco) is a corporation validly existing under
the laws of its jurisdiction of incorporation and
has all necessary corporate power and authority
to own, lease and operate its assets and to carry
on its business as described in the Prospectus
(including the Business), and to enter into and
perform its obligations under each of the Related
Agreements to which it is a party;
(v) immediately after Closing and completion of the
Closing Transactions, Amalco will be a
corporation validly existing under the CBCA and
will have all necessary corporate power and
authority to own, lease and operate its assets
and to carry on its business as described in the
Prospectus (including the Business), and to enter
into and perform its obligations under each of
the Related Agreements to which it is a party;
(vi) (A) immediately after Closing and completion of
the Closing Transactions, the Fund will be the
registered owner, as the case may be, of all of
the issued and outstanding shares of Amalco and
Amalco will be the registered owner of all of the
issued and outstanding shares of Buffalo Envelope
Inc.; and (B) no person, firm or corporation has
any agreement or option, or right or privilege
(whether pre-emptive or contractual) capable of
becoming an option or other agreement for the
purchase from any of the Material Subsidiaries of
any unissued share or other security of such
Material Subsidiary;
(vii) neither the Fund nor any of the Material
Subsidiaries is in violation of, and the
execution and delivery of this Agreement, the
performance by each of the Fund and the Material
Subsidiaries of its respective obligations under
- 14 -
this Agreement and each of the Related Agreements
to which it is a party, and the consummation of
the Closing Transactions by each of the Fund and
the Material Subsidiaries (as applicable) will
not result in any breach or violation of, or be
in conflict with, or constitute a default under,
or create a state of facts which after notice or
lapse of time, or both, would constitute a
default under, (A) any term or provision of its
respective constating documents or by-laws, (B)
any resolution of the Trustees or unitholders of
the Fund or directors or securityholders of any
of the Material Subsidiaries, or (C) except as
would not have a material adverse effect on the
business, results of operations or financial
condition of the Fund and the Material
Subsidiaries taken as a whole, any contract,
hypothec, mortgage, note, indenture, joint
venture or partnership arrangement, or other
agreement (written or oral) to which any of the
Fund or the Material Subsidiaries is a party, or
any instrument, judgment, decree, order, statute,
rule, licence or regulation applicable to any of
the Fund or the Material Subsidiaries;
(viii) no approval, authorization, consent or other
order of, and no filing, registration or
recording with any governmental authority is
required of any of the Fund or the Material
Subsidiaries in connection with the execution or
with the performance of this Agreement by the
Fund and Supremex, the consummation by the Fund
and the Material Subsidiaries of the Closing
Transactions (including in respect of the
transfers of securities to be made in connection
therewith) or to comply with Canadian Securities
Laws with regard to the distribution of the Units
in the Qualifying Provinces or with U.S.
Securities Laws with regard to the distribution
of the Units in the Qualifying States, except
such as may be required by the securities or blue
sky laws of the various states in connection with
the offer and sale of the Units (as to which no
representation or warranty is given);
(ix) this Agreement has been duly authorized, executed
and delivered by each of the Fund and Supremex
and constitutes a legal, valid and binding
obligation of the Fund and Supremex enforceable
against the Fund and Supremex in accordance with
its terms, except as enforcement hereof may be
limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws
affecting the rights of creditors generally and
except as limited by the application of equitable
principles when equitable remedies are sought and
subject to the fact that rights of indemnity and
contribution may be limited by applicable law;
(x) at, before or immediately after Closing, as
applicable, each of the Related Agreements to
which each of the Fund and/or any of the Material
Subsidiaries is a party will have been duly
authorized, executed and delivered by the Fund
and/or such Material Subsidiaries, as applicable,
and will constitute a legal, valid and binding
obligation of the Fund and each such Material
Subsidiary enforceable against the Fund and each
such Material Subsidiary in accordance with its
terms, except as enforcement
- 15 -
thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws
affecting the rights of creditors generally and
except as limited by the application of equitable
principles when equitable remedies are sought and
subject to the fact that rights of indemnity and
contribution may be limited by applicable law;
(xi) the description of each of the Related Agreements
in the Prospectus is, in all material respects, a
true, complete and accurate description of the
material terms and conditions of each such
Related Agreement;
(xii) the description of the securities of the Fund,
and Supremex in the Prospectus is, in all
material respects, a true, complete and accurate
description of the rights, privileges,
restrictions, terms and conditions attaching to
such securities;
(xiii) no agreement is currently in force or effect
which, in any manner, affects the voting or
control of any of the securities of the Fund and,
at the Closing Time, no such agreement will be in
force or effect;
(xiv) at the Closing Time, the Purchased Units will be
validly created and be duly authorized and issued
as fully-paid and non-assessable;
(xv) if applicable, at the Option Closing Time, the
Additional Units will be validly created and duly
authorized and issued as fully-paid and
non-assessable;
(xvi) no securities commission, stock exchange or
comparable authority has issued any order
preventing or suspending the use or effectiveness
of the Preliminary Prospectus, the Amended
Preliminary Prospectus, the Final Prospectus, or
any Prospectus Amendment or preventing the
distribution of the Units, if any, in any
Qualifying Province nor instituted proceedings
for that purpose and, to the knowledge of the
Fund, no such proceedings are pending or
contemplated;
(xvii) at the Closing Time, Computershare Investor
Services Inc, at its offices in the cities of
Montreal and Toronto, will have been duly
appointed as registrar, transfer agent and
distribution disbursing agent for the Units;
(xviii) except as disclosed in the Prospectus, there is
no litigation or governmental or other proceeding
or investigation at law or in equity before any
court or before or by any federal, provincial,
state, municipal or other governmental or public
department, commission, board, agency or body,
domestic or foreign, pending or, to the Fund's or
Supremex's knowledge, threatened (and none of the
Fund or Supremex knows of any basis therefor)
against, or involving the assets, properties or
business of, the Fund or any of the Material
Subsidiaries nor are there any matters under
discussion with any governmental authority
relating to taxes, governmental charges or
assessments asserted by any such authority which
would have a material adverse effect on the
business, results of
- 16 -
operations or financial condition of the Fund and
the Material Subsidiaries, taken as a whole;
(xix) the Units have been conditionally approved for
trading on the TSX subject to satisfaction of the
listing conditions set forth in the conditional
approval letter of the TSX dated March 16, 2006;
(xx) the Fund is not a non-resident of Canada under
the Income Tax Act (Canada) and, subject to
meeting the minimum distribution requirements
with respect to the purchasers of the Units
pursuant to paragraph 132(6)(c) of the Income Tax
Act (Canada) and the filing of an election under
sub-section 132(6.1) of the Income Tax Act
(Canada), the Fund will, at the Closing Date,
qualify as a "mutual fund trust" under the Income
Tax Act (Canada);
(xxi) the Financial Statements in the Prospectus and
any Prospectus Amendment have been prepared in
accordance with the applicable books and records
of the Fund and Supremex and present fairly in
all material respects (on a pro forma basis when
applicable) the consolidated financial position
of the Fund and Supremex, as applicable, as of
the applicable dates, and the results of
operations and cash flows of the Fund and
Supremex, as applicable, for the applicable
periods, except as otherwise indicated in the
Financial Statements.
(xxii) Except as reflected, reserved against or
otherwise disclosed in the Financial Statements,
as of December 31, 2005, Supremex did not have
any liabilities or obligations of any nature
(whether absolute, accrued, contingent or
otherwise) that would have been required to be
reflected by it in the balance sheet of Supremex
dated as of such date included in the Financial
Statement in accordance with GAAP, with such
exceptions as are not, individually or in the
aggregate, reasonably likely to result in a
material adverse effect on the business,
financial condition or results of operations of
the Fund and the Material Subsidiaries, taken as
a whole;
(xxiii) none of the Fund or any of the Material
Subsidiaries has incurred any liabilities or
obligations of any nature (whether accrued,
absolute, contingent or otherwise) that continue
to be outstanding, except as disclosed in the
Financial Statements or the Prospectus, or
incurred in the ordinary course of business,
other than those liabilities and obligations that
are not, individually or in the aggregate,
reasonably likely to result in a material adverse
effect on the business, financial condition or
results of operations of the Fund and the
Material Subsidiaries, taken as a whole;
(xxiv) other than in connection with the Closing
Transactions or as otherwise disclosed in the
Final Prospectus, since December 31, 2005:
(A) the Material Subsidiaries have operated
their business (including the Business),
taken as a whole, in the ordinary
course;
- 17 -
(B) there has not been any material adverse
change in the assets, liabilities,
business, financial condition or results
of operations of the Fund and the
Material Subsidiaries, taken as a whole;
(C) there has not been any acquisition of
all or substantially all of the assets
or properties or of the securities or
business of any other person by the Fund
or any of the Material Subsidiaries or
any merger, consolidation or
amalgamation involving the Fund or any
Material Subsidiaries;
(D) none of the Fund or any of the Material
Subsidiaries has transferred, assigned,
sold, distributed, dividended or
otherwise disposed of any of the
material assets shown or reflected in
the Financial Statements or cancelled
any material debts or entitlements;
(E) through the date of this Agreement,
there has not been any incurrence by the
Fund or any Material Subsidiary of any
indebtedness for borrowed money or
incurrence, assumption or guarantee of,
or any other act to become responsible
for, any liabilities or obligations or
indebtedness of any other person, or
making of loans or advances by the Fund
or any Material Subsidiary to any
person, other than in the ordinary
course of business; or
(F) there has not been any change in the
financial or accounting practices or
policies of any Material Subsidiaries,
except as required by applicable
legislation or GAAP;
(xxv) the Financial Information (other than the
information described in items (b), (d), (g), (h)
and (i) of such term) and the unaudited pro forma
consolidated financial statements of the Fund
included in the Prospectus has been properly
compiled to give effect to the assumptions and
adjustments described in respect thereof, which
assumptions are reasonable;
(xxvi) each of the Fund and Material Subsidiaries
maintains or, at the Closing Date, will have
established and will maintain a system of
internal accounting controls sufficient to
provide reasonable assurance that: (A)
transactions are executed in accordance with
management's general or specific authorizations;
(B) transactions are recorded as necessary to
permit the preparation of financial statements in
conformity with GAAP and to maintain
accountability for assets; (C) access to assets
is permitted only in accordance with management's
general or specific authorizations; and (D) the
recorded accountability for assets is compared
with the existing assets at reasonable intervals
and appropriate action is taken with respect to
any differences;
- 18 -
(xxvii) the reports and statistical and market-related
data included in the Prospectus are derived from
sources which were provided to Supremex and which
Supremex reasonably and in good faith believes to
be accurate and reliable;
(xxviii) other than as discussed in the Prospectus, no
acquisitions or dispositions have been made by
Supremex in the three most recently completed
fiscal years that are "significant acquisitions"
or "significant dispositions" and neither the
Fund nor any of the Material Subsidiaries are a
party to any contract with respect to any
transaction that would constitute a "probable
acquisition", in each case which would require
disclosure in the Prospectus pursuant to
Regulation Q-28 respecting General Prospectus
Requirements or similar requirements of other
Canadian Securities Laws;
(xxix) Ernst & Young LLP are independent with respect to
the Fund and the Material Subsidiaries within the
meaning of the Canadian Securities Laws and of
the Code of Ethics of Chartered Accountants of
Quebec and there has not been any "reportable
event" (within the meaning of Regulation 51-102
concerning Continuous Disclosure Obligations
(Quebec)) with the auditors of the Fund or any of
the Material Subsidiaries with respect to the
last three years, as if each had been a public
reporting issuer during that time;
(xxx) no trustee, director or officer, former trustee,
director or officer, unitholder, shareholder or
employee of, or any other person not dealing at
arm's length with, the Fund or any of the
Material Subsidiaries, and their respective
directors, officers or employees, will continue
after the Closing Time to be engaged in any
material transaction or arrangement with, to be a
party to a material contract with, or to have any
material indebtedness, liability or obligation
to, the Fund or any of the Material Subsidiaries,
except as disclosed in the Prospectus;
(xxxi) the minute books and related records of Supremex,
PNG Inc. and Innova Envelope Inc. made available
to counsel for the Underwriters in connection
with their due diligence investigation in respect
of the offering of the Units constitute all of
the minute books and related records of any
Material Subsidiaries and, to the knowledge of
Supremex, contain copies of all proceedings (or
certified copies thereof) of the shareholders,
the boards of directors and all committees of the
boards of directors of any Material Subsidiaries
to the date of review of such corporate records
and minute books and, to the knowledge of
Supremex, there have been no other meetings,
resolutions or proceedings of the shareholders,
board of directors or any committees of the board
of directors of any Material Subsidiaries to the
date of review of such corporate records and
minute books not reflected in such minutes and
other records, other than those which have been
disclosed to the Underwriters;
(xxxii) except as contemplated hereby, there is no person
acting or purporting to act at the request of the
Fund or any of the Material Subsidiaries who is
- 19 -
entitled to any brokerage or agency fee in
connection with the sale of the Units; and
(xxxiii) each of the representations and warranties made
by Cenveo and Cenveo US in sections 3.6 to 3.26
inclusively of the Acquisition Agreement to the
Fund and Supremex and each of the representations
and warranties of Cenveo US in sections 3.4 to
3.14 inclusively of the Cenveo Xxxxx Acquisition
Agreement to Buffalo Envelope Inc. are true and
correct as of the date hereof and are hereby
incorporated by reference into this Agreement and
shall apply mutatis mutandis as if they were
representations and warranties made by the Fund
and Supremex to the Underwriters in this
Agreement.
(c) REPRESENTATIONS AND WARRANTIES OF CENVEO AND CENVEO US
Cenveo and Cenveo US hereby solidarily represent and warrant that,
as of the date hereof and as at the Closing Time, the following to
the Underwriters and acknowledges that the Underwriters are
relying upon such representations and warranties in purchasing the
Units:
(i) it is a corporation validly existing under the
laws of the State of Colorado or Delaware, as
applicable, and has all necessary power and
authority to own, lease and operate its assets,
to carry on its business, and to enter into and
perform its obligations under this Agreement and
each of the Related Agreements to which it is a
party;
(ii) the execution of this Agreement and each of the
Related Agreements to which it is a party, and
the performance of its obligations hereunder and
thereunder has been duly authorized by all
necessary corporate action on its part;
(iii) it is not in violation of, and the execution of
each of this Agreement and the Related Agreements
to which it is a party, the performance by it of
its obligations under this Agreement and each of
the Related Agreements to which it is a party and
the consummation of the Closing Transactions by
it will not result in any breach or violation of,
or be in conflict with, or constitute a default
under, or create a state of facts which after
notice or lapse of time, or both, would
constitute a default under, (A) any term or
provision of its constating documents or by-laws,
(B) any resolution of its directors or
securityholders, or (C) with such exceptions as
do not have a material adverse effect on the
ability of Cenveo or Cenveo US to perform their
respective obligations pursuant to this Agreement
and except for such consents as may be required
in relation to item (x) below which will have
been obtained on or prior to the Closing Date,
any contract, hypothec, mortgage, note,
indenture, lease, joint venture or partnership
arrangement or other agreement (written or oral)
to which it is a party, or any instrument,
judgment, decree, order, statute, rule, licence
or regulation applicable to it, including without
limitation (x) the US$300 million senior secured
credit facility of Cenveo with a group of banks
which matures in
- 20 -
June 2008, (y) the note indenture pursuant to which
the US$320 million of 7-7/8% senior subordinated
notes of Cenveo due 2013 were issued, and (z) the
note indenture pursuant to which the US$350
million 9-5/8% senior notes of Cenveo due 2012
were issued;
(iv) each of this Agreement and the Related Agreements
to which it is a party constitutes a legal, valid
and binding obligation of each of Cenveo and
Cenveo US, enforceable against it in accordance
with its terms, except as enforcement thereof may
be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws
affecting the rights of creditors generally and
except as limited by the application of equitable
principles when equitable remedies are sought and
subject to the fact that rights of indemnity and
contribution may be limited by applicable law;
(v) none of Cenveo, Cenveo US or any of their
respective controlled affiliates (other than the
Fund and Supremex and their respective
subsidiaries), directors officers or employees,
or any other person not dealing at arm's length
with Cenveo, Cenveo US or any of their respective
controlled affiliates (other than the Fund and
Supremex and their respective subsidiaries) will
continue after the Closing Time to be engaged in
any transaction or arrangement with, to be a
party to a contract with, or to have any
indebtedness, liability or obligation to, the
Fund or any of the Material Subsidiaries, except
as disclosed in the Prospectus or contemplated by
the Related Agreements;
(vi) Cenveo Canada is a corporation validly existing
under the laws of Nova Scotia and has all
necessary corporate power and authority to enter
into and perform its obligations under each of
the Related Agreements to which it is a party;
(vii) Immediately prior to the amalgamation of Supremex
with Cenveo Canada to form Amalco, (A) Cenveo US
will be the registered owner of all of the issued
and outstanding shares of Cenveo Canada, and (B)
other than pursuant to the Acquisition Agreement,
no person, firm or corporation has any agreement
or option, right or privilege (whether
pre-emptive or contractual) capable of becoming
an option or other agreement for the purchase of
any unissued share or other security of Cenveo
Canada;
(viii) (w) Cenveo Canada is not in violation of, and its
continuation under the CBCA and the consummation
of its amalgamation with Supremex to form Amalco
will not result in, and (x) the performance by
Amalco of its obligations under the Related
Agreements to which Amalco is a party and the
consummation of the Closing Transactions by
Amalco will not result in, any breach or
violation of, or be in conflict with, or
constitute a default under, or create a state of
facts which after notice or lapse of time, or
both, would constitute a default under: (A) any
term or provision of the constating documents or
by-laws of Cenveo Canada, (B) any resolution of
the directors or securityholders of Cenveo
Canada, or (C) with such exceptions as do not
have a material adverse effect on (y) the ability of
- 21 -
Cenveo Canada to effect its continuation under
the CBCA and consummate its amalgamation with
Supremex to form Amalco, and (z) the ability of
Amalco to perform its obligations under the
Related Agreements to which Amalco is a party and
to consummate the Closing Transactions, any
contract, hypothec, mortgage, note, indenture,
joint venture or partnership arrangement, or
other agreement (written or oral) to which Cenveo
Canada is a party, or any instrument, judgment,
decree, order, statute, rule, licence or
regulation applicable to Cenveo Canada;
(ix) at, before or immediately after Closing, as
applicable, each of the Related Agreements to
which Cenveo Canada is a party will have been
duly authorized, executed and delivered by Cenveo
Canada and will constitute a legal, valid and
binding obligation of Cenveo Canada enforceable
against Cenveo Canada in accordance with its
terms, except as enforcement thereof may be
limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws
affecting the rights of creditors generally and
except as limited by the application of equitable
principles when equitable remedies are sought and
subject to the fact that rights of indemnity and
contribution may be limited by applicable law;
(x) except as disclosed in the Prospectus, there is
no litigation or governmental or other proceeding
or investigation at law or in equity before any
court or before or by any federal, provincial,
state, municipal or other governmental or public
department, commission, board, agency or body,
domestic or foreign, pending against, or
involving the assets, properties or business of,
Cenveo Canada nor are there any matters under
discussion with any governmental authority
relating to taxes, governmental charges or
assessments asserted by any such authority which
would have a material adverse effect on the
business, results of operations or financial
condition of Cenveo Canada, Supremex and its
subsidiaries taken as a whole; and
(xi) other than the sections of the Prospectus
entitled "Canadian Income Tax Considerations" and
"Eligibility for Investment" and the information
and statements relating solely to the
Underwriters as to which no representation is
given, the Prospectus constitutes full, true and
plain disclosure of all material facts relating
to the Business and does not contain any
misrepresentation.
(d) SURVIVAL OF REPRESENTATIONS AND WARRANTIES
(i) The representations, warranties, obligations and
agreements of the Fund and Supremex contained in
this Agreement and in any certificate delivered
pursuant to this Agreement or in connection with
the purchase and sale of the Units shall survive
the purchase of the Units and shall continue in
full force and effect for a period of 18 months
from the Closing Date unaffected by any
subsequent disposition of the Units by the
Underwriters or the termination of the
Underwriters' obligations and shall not be
limited or prejudiced by any investigation made
by or on behalf of the
- 22 -
Underwriters in connection with the preparation of
the Prospectus, any Prospectus Amendments or the
distribution of the Units, except that: (w) the
representations and warranties set out in
sections 5(a), 5(b)(xi) and 5(b)(xii) (and the
related indemnity obligation with respect to the
foregoing sections) shall survive for a period of
90 days following the date on which the Fund is
no longer liable under Canadian Securities Laws
for a misrepresentation under the Prospectus, (x)
the representations and warranties set out in
sections 5(b)(i) to 5(b)(vi) inclusively,
5(b)(vii)(A) and (B), 5(b)(ix), 5(b)(xiv) and
5(b)(xv) (and the related indemnity obligation
with respect to the foregoing sections) shall
survive the Closing and continue in full force
and effect without limitation of time, (y) the
representations and warranties set out in section
5(b)(xxxiii) (and the related indemnity
obligation with respect to the foregoing section)
shall be subject to the time limitations set
forth in section 7.1 of the Acquisition
Agreement, and (z) a claim for any breach of any
of the representations and warranties of the Fund
or Supremex contained in this Agreement involving
fraud shall not be subject to any limitation of
time.
(ii) The representations, warranties, obligations and
agreements of Cenveo and Cenveo US contained in
this Agreement and in any certificate delivered
pursuant to this Agreement or in connection with
the purchase and sale of the Units shall survive
the purchase of the Units and shall continue in
full force and effect for a period of 18 months
from the Closing Date unaffected by any
subsequent disposition of the Units by the
Underwriters or the termination of the
Underwriters' obligations and shall not be
limited or prejudiced by any investigation made
by or on behalf of the Underwriters in connection
with the preparation of the Prospectus, any
Prospectus Amendments or the distribution of the
Units, except that: (x) the representations and
warranties set out in section 5(c)(i), 5(c)(ii),
5(c)(iii)(A), 5(c)(iii)(B), 5(c)(iv), 5(c)(vi),
5(c)(viii)(A), 5(c)(viii)(B) and 5(c)(ix) (and
the related indemnity obligation with respect to
the foregoing sections) shall survive the Closing
and continue in full force and effect without
limitation of time, and (y) the representations
and warranties set out in and sections 5(c)(x)
and 5(c)(xi) (and the related indemnity
obligation with respect to the foregoing
sections) inclusively shall survive until the
date that is three years and 90 days following
the Closing Date (i.e., the date on which the
Fund is no longer liable under Canadian
Securities Laws for a misrepresentation under the
Prospectus).
6. COVENANTS OF THE FUND
The Fund covenants and agrees with the Underwriters, Cenveo and Cenveo US
that:
(a) it will advise the Underwriters, promptly after receiving
notice thereof, of the time when the Final Prospectus has
been filed and when the Final MRRS Decision Document in
respect thereof and any other receipts have been obtained
and will provide evidence satisfactory to the Underwriters
of each filing and the issuance of the Final MRRS Decision
Document and any other receipts;
- 23-
(b) it will advise the Underwriters, promptly after receiving
notice or obtaining knowledge, of: (i) the issuance by any
Canadian Securities Regulator of any order suspending or
preventing the use of the Preliminary Prospectus, the
Amended Preliminary Prospectus, the Final Prospectus or
any Prospectus Amendment; (ii) the suspension of the
qualification of the Units for distribution or sale in any
of the Qualifying Provinces; (iii) the institution or
threatening of any proceeding for any of those purposes;
or (iv) any requests made by any Canadian Securities
Regulator for amending or supplementing the Prospectus, or
for additional information, and will use its commercially
reasonable efforts to prevent the issuance of any such
order and, if any such order is issued, to obtain the
withdrawal of the order promptly;
(c) it will, and will cause each of the Material Subsidiaries
to, apply the proceeds from the issue and sale of the
Units in accordance with the disclosure set out under the
heading "Use of Proceeds" in the Prospectus;
(d) except for the Initial Notes and the Over-Allotment Note,
it will not issue any third party indebtedness until the
31st day following the Closing Date;
(e) it will, and will cause each of the Material Subsidiaries
to, execute and deliver the Related Agreements to which it
is a party;
(f) after the Closing Date, the Fund will file the election
contemplated by subsection 132(6.1) of the Income Tax Act
(Canada) and any corresponding provision of provincial tax
legislation to ensure its status as a "mutual fund trust"
thereunder;
(g) the Fund and the Material Subsidiaries will refund to the
Underwriters the purchase price paid by them for the
Purchased Units under this Agreement if the transactions
contemplated by the Prospectus to occur at or immediately
prior to Closing are not completed provided that, in such
event, the Underwriters will return to the Fund the fees
paid to them by the Fund, less any expenses as
contemplated by section 18, and will return to investors
any amounts paid by them for the Purchased Units; and
(h) (A) if the over-allotment option is exercised in full by
the Underwriters, the Fund will irrevocably direct payment
at the Option Closing Time by the Underwriters of the
aggregate of the Purchase Price of the Additional Units
net of the applicable Underwriting Fee to Cenveo US as
payment in full of the Over-Allotment Note; (B) if the
over-allotment option is exercised in part by the
Underwriters, the Fund will (x) irrevocably direct payment
at the Option Closing Time by the Underwriters of the
aggregate of the Purchase Price of such Additional Units
net of the applicable Underwriting Fee to be purchased by
the Underwriters on the Option Closing Date to Cenveo US
as partial payment of the Over-Allotment Note, and (y)
issue at the Option Closing Time to Cenveo US that number
of units of the Fund prescribed by the Over-Allotment
Note, and (C) if the over-allotment option is not
exercised by the Underwriters, the Fund will issue that
number of units of the Fund prescribed by the
Over-Allotment Note to Cenveo US as payment in full of the
Over-Allotment Note. AcquisiCo shall pay to the
Underwriters the Underwriting Fee with respect to any
Additional Units
- 24 -
purchased pursuant to the exercise in whole or in part by the
Underwriters of the over-allotment option concurrently
with any payment to be made by the Underwriters to Cenveo
US at the direction of the Fund pursuant to this paragraph
(nothing in this sentence shall release the Fund from the
obligation to make the foregoing payment).
7. CHANGE OF CLOSING DATE
Subject to the termination provisions contained in section 14, if a material
change or a change in a material fact occurs or is discovered prior to the
Closing Date, the Closing Date shall be, unless the Fund and the
Underwriters otherwise agree in writing or unless otherwise required under
Canadian Securities Laws, the sixth Business Day following the later of:
(i) the date on which all applicable filings or other
requirements of Canadian Securities Laws with
respect to such material change or change in a
material fact have been complied with in all
Qualifying Provinces and any appropriate MRRS
decision documents obtained for such filings and
notice of such filings from the Fund or its
counsel have been received by the Underwriters;
and
(ii) the date upon which the commercial copies of any
Prospectus Amendments have been delivered in
accordance with section 4(c).
8. COMPLETION OF DISTRIBUTION
The Underwriters shall after the Closing Time and, if applicable, the Option
Closing Time, give prompt written notice to the Fund when, in the opinion of
the Underwriters, they have completed distribution of the Purchased Units or
the Additional Units as the case may be, including the total proceeds
realized in each of the Qualifying Provinces, the Qualifying States and any
other jurisdiction from such distribution.
9. CHANGES
(a) MATERIAL CHANGE OR CHANGE IN MATERIAL FACT DURING
DISTRIBUTION
During the period from the date of this Agreement to the later of the
Closing Date and the date of completion of distribution of the Units, the
Fund shall promptly notify the Underwriters in writing of:
(i) any material change (actual, anticipated,
contemplated or threatened, financial or
otherwise) in the business, affairs, operations,
assets, liabilities (contingent or otherwise) or
capital of the Fund or any Material Subsidiaries
taken as a whole;
(ii) any material fact which has arisen or has been
discovered and would have been required to have
been stated in the Final Prospectus had the fact
arisen or been discovered on, or prior to, the
date of such document; and
(iii) any change in any material fact (which for the
purposes of this Agreement shall be deemed to
include the disclosure of any previously
undisclosed
- 25 -
material fact) contained in the Final Prospectus or
any Prospectus Amendment, which fact or change is,
or may be, of such a nature as to render any
statement in the Final Prospectus or any
Prospectus Amendment misleading or untrue in any
material respect or which would result in a
misrepresentation in the Final Prospectus or any
Prospectus Amendment or which would result in the
Final Prospectus or any Prospectus Amendment not
complying (to the extent that such compliance is
required) with Canadian Securities Laws, in each
case, as at any time up to and including the
later of the Closing Date and the date of
completion of the distribution of the Units.
The Fund shall promptly, and in any event within any applicable time
limitation, comply, to the satisfaction of the Underwriters, acting
reasonably, with all applicable filings and other requirements under the
Canadian Securities Laws as a result of such fact or change; provided that
the Fund shall not file any Prospectus Amendment or other document without
first obtaining from the Underwriters their approval, after consultation
with the Underwriters with respect to the form and content thereof, which
approval will not be unreasonably withheld or delayed. The Fund shall in
good faith discuss with the Underwriters any fact or change in circumstances
(actual, anticipated, contemplated or threatened, financial or otherwise)
which is of such a nature that there is reasonable doubt whether written
notice need be given under this section 9(a).
(b) CHANGE IN CANADIAN SECURITIES LAWS
If during the period of distribution of the Units there shall be any change
in Canadian Securities Laws that, in the opinion of the Underwriters, acting
reasonably, requires the filing of a Prospectus Amendment, the Fund shall,
to the satisfaction of the Underwriters, acting reasonably, promptly prepare
and file such Prospectus Amendment with the appropriate securities
regulatory authority in each of the Qualifying Provinces where such filing
is required.
10. SERVICES PROVIDED BY UNDERWRITERS AND UNDERWRITING FEE
In return for the Underwriters' services in acting as financial advisors to
the Fund, assisting in the preparation of the Prospectus (and any Prospectus
Amendments), advising on the final terms and conditions of the Units,
performing and managing banking, selling or other groups for the sale of the
Units, distributing the Units, both directly and to other registered dealers
as brokers, and performing administrative work in connection with the
distribution of the Units, the Fund agrees to cause AcquisiCo to pay the
Underwriting Fee at the Closing Time and, if applicable, the Option Closing
Time against delivery of the Units and, if applicable, the Additional Units.
The Underwriting Fee shall be payable as provided for in section 11.
11. DELIVERY OF PURCHASE PRICE, UNDERWRITERS' FEE AND CERTIFICATES
The purchase and sale of the Purchased Units and, if applicable, the
Additional Units shall be completed at the Closing Time and the Option
Closing Time, as the case may be, at the offices of Stikeman Elliott LLP,
0000 Xxxx-Xxxxxxxx Xxxxxxxxx Xxxx, Xxxxx 0000, Xxxxxxxx, Xxxxxx, or at such
other place as the Underwriters and the Fund may agree upon.
At the Closing Time or the Option Closing Time, as the case may be, the Fund
shall duly and validly deliver to the Underwriters one or more definitive
global unit certificate(s) representing
- 26 -
the Purchased Units or the Additional Units, as the case may be registered
in the name of CDS & Co. or in such other nominee name or names for CDS as
the Lead Underwriters may notify the Fund in writing not less than 24 hours
prior to the Closing Time or the Option Closing Time, as the case may be,
against payment by the Underwriters, as directed by the Fund, of the
Purchase Price for the Purchased Units or the Additional Units, as the case
may be, by wire transfer in each case together with a receipt signed by the
Lead Underwriters for such definitive global certificate(s) and for receipt
of the Underwriting Fee.
In order to facilitate an efficient and timely closing at the Closing Time
and the Option Closing Time, the Underwriters may choose to initiate a wire
transfer of funds to the Fund or its counsel prior to the Closing Time or
the Option Closing Time, as the case may be. If the Underwriters do so, the
Fund agrees that such transfer of funds to the Fund prior to the Closing
Time or the Option Closing Time does not constitute a waiver by the
Underwriters of any of the conditions of the Closing or the Option Closing
set out in this Agreement. Furthermore, the Fund agrees that any such funds
received from the Underwriters prior to the Closing Time or the Option
Closing Time, as the case may be, will be held in trust solely for the
benefit of the Underwriters until the Closing Time or the Option Closing
Time, as the case may be, and if the Closing or the Option Closing, as the
case may be, does not occur at the scheduled Closing Time or the Option
Closing Time, as the case may be, such funds shall be immediately returned
by wire transfer to either of the Lead Underwriters, on behalf of the
Underwriters, without interest. Upon the satisfaction of the conditions of
the Closing or the Option Closing, as the case may be, and the delivery to
the Underwriters of the items set out in section 13, the funds held in trust
for the Underwriters shall be deemed to be delivered by the Underwriters to
the Fund in satisfaction of the obligation of the Underwriters under this
section 11 and upon such delivery the trust constituted by this section 11
shall be terminated without further formality.
12. DELIVERY OF CERTIFICATES TO TRANSFER AGENT
The Fund shall, prior to the Closing Date or the Option Closing Date, as the
case may be, make all necessary arrangements for the exchange of the
definitive certificate(s) representing the Purchased Units or the Additional
Units, as the case may be, on the Closing Date or the Option Closing Date,
as the case may be, with CDS.
The Fund shall cause AcquisiCo to pay all fees and expenses payable to CDS
and/or the Transfer Agent in connection with the preparation, delivery,
certification and exchange of the certificates representing the Purchased
Units and the Additional Units contemplated by this section 12 and the fees
and expenses payable to CDS in connection with the initial or additional
transfers as may be required in the course of the distribution of the Units.
13. UNDERWRITERS' OBLIGATION TO PURCHASE
The Underwriters' obligation to purchase the Purchased Units at the Closing
Time shall be subject to the accuracy of the representations and warranties
of each of the Fund, Supremex, Cenveo and Cenveo US contained in this
Agreement as of the date of this Agreement and in all material respects as
of the Closing Date (except, in each case, for those representations and
warranties that are subject to a materiality qualification, which will be
true and correct in all respects), the performance by each of the Fund,
Supremex, Cenveo and Cenveo US of their respective obligations under this
Agreement and the following conditions:
- 27 -
(a) DELIVERY OF OPINIONS
(i) the Underwriters, Cenveo and Cenveo US shall have
received at the Closing Time a favourable legal
opinion dated the Closing Date, in form and
substance satisfactory to counsel to the
Underwriters, Cenveo and Cenveo US addressed to
the Underwriters and counsel to the Underwriters,
Cenveo and Cenveo US from Stikeman Elliott LLP,
counsel to the Fund and Supremex, as to the laws
of Canada and the Qualifying Provinces, which
counsel in turn may rely upon the opinions of
local counsel where they deem such reliance
proper as to the laws other than those of Canada
and Quebec, British Columbia, Alberta and Ontario
and as to matters of fact, on certificates of the
auditors of the Fund and Supremex, public and
stock exchange officials and officers of the Fund
and Supremex, with respect to the following
matters, assuming completion of the Closing and
the Closing Transactions:
(A) as to the valid existence of each of the
Fund and the Material Subsidiaries under
the laws of their respective
jurisdiction of organization or
incorporation, as applicable;
(B) as to the authorized and issued capital
of each of the Fund and the Material
Subsidiaries;
(C) that the Fund or a Material Subsidiary,
as applicable, is the registered owner
of all of the issued and outstanding
shares of each of the Material
Subsidiaries;
(D) that each of the Fund and the Material
Subsidiaries has all requisite power,
capacity and authority under the laws of
its respective jurisdiction of
incorporation or organization, as
applicable, and each is qualified to:
(I) carry on its businesses
(including the Business) as
presently carried on;
(II) own its property;
(III) in the case of the Fund, to
issue the Units;
(IV) in the case of the Fund and
Supremex, to enter into this
Agreement; and
(V) in the case of the Fund and
each of the Material
Subsidiaries, to enter, into
each of the Related Agreements
to which it is a party, and to
carry out the transactions
contemplated thereby, including
the Closing Transactions;
(E) that all necessary action has been taken
by each of the Fund and the Material
Subsidiaries to authorize, as
applicable: (I) the
- 28 -
execution and delivery of this Agreement,
(II) the execution and delivery of each of
the Preliminary Prospectus, Amended
Preliminary Prospectus and Final
Prospectus and, if applicable, any
Prospectus Amendments, (III) the filing
of each of the Preliminary Prospectus,
the Amended Preliminary Prospectus and
the Final Prospectus and, if applicable,
any Prospectus Amendments under the
Canadian Securities Laws in each of the
Qualifying Provinces, and (IV) the
execution and delivery of each of the
Related Agreements to which it is a
party and the performance of its
obligations thereunder;
(F) that the Units and the Management Units
have been duly authorized and, when
issued and delivered, will be validly
issued by the Fund and outstanding as
fully paid and non-assessable Units;
(G) that the description of the Units in the
Prospectus is, in all material respects,
a true, complete and accurate
description of the rights, privileges,
restrictions and conditions attaching to
the Units;
(H) that the execution and delivery of this
Agreement by the Fund and Supremex, the
fulfilment of the terms of this
Agreement, the issue and sale of the
Units and, the consummation of the
transactions contemplated by this
Agreement, do not and will not result in
a breach (whether after notice or lapse
of time or both) of any statute, by-law
regulation, or of the terms, conditions
or provisions of the constating
documents of such parties or resolutions
of trustees, directors or security
holders of the Fund or Supremex or the
Related Agreements to which the Fund or
Supremex are bound;
(I) that this Agreement has been duly
authorized and executed by each of the
Fund and Supremex and constitutes a
legal, valid and binding obligation of
the Fund and Supremex and is enforceable
in accordance with its terms, except as
enforcement of this Agreement may be
limited by bankruptcy, insolvency,
reorganization, moratorium or similar
laws affecting the rights of creditors
generally and except as limited by the
application of equitable principles when
equitable remedies are sought; provided
that such counsel may express no opinion
as to the enforceability of the
indemnity provisions of section 15, the
contribution provisions of section 16
and the severability provisions as set
forth in section 17;
(J) that the execution and delivery by each
of the Fund and the Material
Subsidiaries of each of the Related
Agreements to which it is a party, the
fulfilment of the terms and the
performance of the obligations of such
party thereunder, and consummation of
the transactions contemplated thereby do
not and will not result in a breach
(whether after notice or lapse of time
or both) of any
- 29 -
statute, law, by-law, regulation, decree,
judgement or order, or the terms of any
of the constating documents of such
party or any resolutions of trustees,
directors or security holders of such
party;
(K) that each of the Related Agreements
governed by Canadian laws to which each
of the Fund and the Material
Subsidiaries is a party has been duly
authorized and executed by each of the
Fund and the Material Subsidiaries and
constitutes a legal, valid and binding
obligation of such party and is
enforceable against it in accordance
with its terms, except as enforcement
thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium
or similar laws affecting the rights of
creditors generally and except as
limited by the application of equitable
principles when equitable remedies are
sought; provided that such counsel may
express no opinion as to the
enforceability of non-compete or
severability provisions of the Related
Agreements, as applicable;
(L) that the form and terms of the
certificates representing the Units meet
all legal requirements under the rules
of TSX and have been duly approved by
the Fund;
(M) that Computershare Investor Services
Inc. at its principal offices in the
cities of Montreal and Toronto has been
duly appointed as the transfer agent and
registrar for the Units of the Fund;
(N) that all documents have been filed, all
requisite proceedings have been taken
and all legal requirements have been
fulfilled by the Fund to qualify the
Units for distribution and sale to the
public in each of the Qualifying
Provinces through investment dealers or
brokers registered under the applicable
laws of the Qualifying Provinces who
have complied with the relevant
provisions of such applicable laws;
(O) that, subject only to the filing of
documents in accordance with the
requirements of the TSX, the Units have
been conditionally approved for listing
by the TSX on or before the Closing
Date;
(P) that, subject to the assumptions,
qualifications, limitations and
restrictions set out therein, the
statements contained in the Prospectus
under the heading "Canadian Federal
Income Tax Considerations" are an
accurate summary of the principal
Canadian federal income tax
considerations generally applicable
under the Income Tax Act (Canada) to a
holder of Units described therein who
acquires such Units pursuant to the
Prospectus;
(Q) that the statements under the heading in
the Prospectus "Eligibility for
Investment" are accurate, subject to the
assumptions, qualifications, limitations
and restrictions set out therein;
- 30 -
(R) regarding compliance with the laws of
Quebec relating to the use of the French
language in connection with the
documents (including the Preliminary
Prospectus, the Amended Preliminary
Prospectus, the Final Prospectus,
Prospectus Amendments and certificates
representing the Units) to be delivered
to purchasers in Quebec; and
(S) as to all other legal matters reasonably
requested by counsel to the Underwriters
relating to the distribution of the
Units.
(ii) the Underwriters shall have received at the
Closing Time a favourable legal opinion dated the
Closing Date, in form and substance satisfactory
to counsel to the Underwriters, addressed to the
Underwriters and counsel to the Underwriters from
Xxxxxxx Xxxxx, general counsel to Cenveo, with
respect to the following matters, assuming
completion of the Closing and the Closing
Transactions, provided that Xxxxxxx Xxxxx shall
be entitled to rely on the opinion of Stikeman
Elliott LLP as to matters governed by the laws of
Quebec and the laws of Canada applicable therein:
(A) as to the valid existence of each of
Cenveo and Cenveo US under the laws of
the State of Colorado or Delaware, as
applicable;
(B) that each of Cenveo and Cenveo US has
all requisite corporate power and
authority to enter into this Agreement
and to consummate the transactions
contemplated hereby, including the
Closing Transactions;
(C) that all necessary corporate action has
been taken by each of Cenveo and Cenveo
US to authorize, as applicable, the
execution and delivery of this Agreement
and the performance of its obligations
hereunder;
(D) that this Agreement has been duly
authorized, executed and delivered by
each of Cenveo and Cenveo US;
(E) that the execution and delivery by each
of Cenveo ad Cenveo US of this
Agreement, the fulfilment of the terms
and the performance of the obligations
of such party hereunder, and
consummation of the transactions
contemplated hereby do not and will not
result in a breach (whether after notice
or lapse of time or both) of the
certificate of incorporation or by-laws
of such party, of any statute, law or
regulation or, to such counsel's
knowledge, of any decree, judgement or
order; and
(F) that each of the Acquisition Agreement
and the Cenveo Xxxxx Acquisition
Agreement constitutes a legal, valid and
binding obligation of each of the Fund,
Supremex, Cenveo and Cenveo US and is
enforceable against each of such party
in accordance with its terms, except as
enforcement thereof may be limited by
- 31 -
bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the
rights of creditors generally and except
as limited by the application of
equitable principles when equitable
remedies are sought and by public
policy; provided that such counsel may
express no opinion as to the
enforceability of severability
provisions of the foregoing, as
applicable.
(iii) the Underwriters, Cenveo and Cenveo US shall have
received at the Closing Time a favourable legal
opinion dated the Closing Date, in form and
substance satisfactory to counsel to the
Underwriters, Cenveo and Cenveo US, addressed to
the Underwriters and counsel to the Underwriters
from Stikeman Elliott LLP, special Canadian
counsel to Cenveo and Cenveo US, to the effect
that this Agreement constitutes a legal, valid
and binding obligation of each such party and is
enforceable against it in accordance with its
terms, except as enforcement thereof may be
limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws
affecting the rights of creditors generally and
except as limited by the application of equitable
principles when equitable remedies are sought;
provided that such counsel may express no opinion
as to the enforceability of the indemnity
provisions of section 15, the contribution
provisions of section 16 and the severability
provisions as set forth in section 17.
(iv) If any of the Units are distributed in the United
States, the Underwriters shall have received at
the Closing Time a legal opinion, in form and
substance satisfactory to the Underwriters,
addressed to the Underwriters, Cenveo and Cenveo
US from Stikeman Elliott LLP to the effect that
no registration of the Purchased Units is
required under the 1933 Act in connection with
the offer and sale of the Purchased Units to the
Underwriters under this Agreement, or in
connection with the initial resale of the
Purchased Units by the Underwriters in the manner
contemplated by this Agreement, provided that in
each case the offer and sale in the United States
is made in accordance with Schedule A hereto and
all other offers and sales of Purchased Units are
made in accordance with the provisions of this
Agreement; provided that such legal opinion shall
not be required if the fees and expenses to be
incurred by the Fund in order for such legal
opinion to be delivered exceed the value of the
Purchase Price received for the Units sold in the
United States.
(v) The Underwriters shall have received at the
Closing Time a favourable legal opinion of Osler,
Xxxxxx & Harcourt LLP, dated the Closing Date,
addressed to the Underwriters with respect to
certain of the matters in sections 13(a)(i)(N),
13(a)(i)(P) and 13(a)(i)(Q); provided that
counsel to the Underwriters shall be entitled to
rely on the opinions of local counsel as to
matters governed by the laws of jurisdictions
other than the laws of Canada, Ontario, Quebec
and Alberta and as to matters of fact, on
certificates of the auditors of the Fund, the
Underwriters, public officials and officers of
the Fund and Supremex.
- 32-
(b) DELIVERY OF COMFORT LETTER
The Underwriters, Cenveo and Cenveo US shall have received at the Closing
Time a letter dated the Closing Date, in form and substance satisfactory to
the Underwriters, addressed to the Underwriters, the Trustees, Cenveo and
Cenveo US from Ernst & Young LLP, confirming the continued accuracy of the
comfort letter to be delivered to the Underwriters pursuant to section
4(a)(vii) with such changes as may be necessary to bring the information in
such letter forward to a date not more than two Business Days prior to the
Closing Date, which changes shall be acceptable to the Underwriters, Cenveo
and Cenveo US.
(c) DELIVERY OF CERTIFICATES
(i) The Underwriters shall have received at the
Closing Time a certificate dated the Closing
Date, addressed to the Underwriters and counsel
to the Underwriters and signed by appropriate
officers of the Fund, with respect to the
constating documents of the Fund, all resolutions
of Trustees or their delegates relating to this
Agreement, the Prospectus and Related Agreements
to which the Fund is a party, the incumbency and
specimen signatures of signing officers of the
Fund and such other matters as the Underwriters
may reasonably request.
(ii) The Underwriters shall have received at the
Closing Time a certificate dated the Closing
Date, addressed to the Underwriters and counsel
to the Underwriters and signed by the appropriate
officers of each of the Material Subsidiaries,
with respect to the constating documents of such
party, all resolutions of the directors of such
party relating to this Agreement, the Prospectus
and the Related Agreements to which such party is
a party, the incumbency and specimen signatures
of signing officers of such party and such other
matters as the Underwriters may reasonably
request.
(iii) The Underwriters shall have received at the
Closing Time certificates of each of the Fund and
Supremex dated the Closing Date, addressed to the
Underwriters and counsel to the Underwriters and
signed on behalf of such parties by the President
and Chief Executive Officer and the Vice
President and Chief Financial Officer of the
administrator of the Fund or other officers of
the Fund or Supremex acceptable to the
Underwriters, certifying for and on behalf of
such parties, after having made due enquiry and
after having carefully examined the Prospectus
and any Prospectus Amendments, that:
(A) since the respective dates as of which
information is given in the Final
Prospectus as amended by any Prospectus
Amendments that (A) there has been no
material change (actual, anticipated,
contemplated or threatened, whether
financial or otherwise) in the business,
operations, financial condition, results
of operations or capital of the Fund and
each Material Subsidiary taken as a
whole, and (B) no transaction has been
entered into by any of the Fund or any
of the Material Subsidiaries which is
material to the Fund and
- 33 -
the Material Subsidiaries on a consolidated
basis, other than as disclosed in the
Final Prospectus or the Prospectus
Amendments, as the case may be;
(B) that the Final Prospectus, as amended by
any Prospectus Amendment, does not
contain, as of the Closing Date, any
untrue statement of material fact or
omit to state a material fact that is
required to be stated or that is
necessary to make a statement not
misleading in light of the circumstances
in which it was made (other than any
statement relating solely to the
Underwriters, which has been provided by
the Underwriters in writing specifically
for use in the Final Prospectus or any
Prospectus Amendment);
(C) no order, ruling or determination having
the effect of suspending the sale or
ceasing the trading of the Units or any
other securities of the Fund has been
issued by any regulatory authority and
is continuing in effect and no
proceedings for that purpose have been
instituted or are pending or, to the
knowledge of such officers, contemplated
or threatened under any of the Canadian
Securities Laws or by any other
regulatory authority;
(D) each of the Fund and Supremex, as
applicable, has complied with the terms
and conditions of this Agreement on its
part to be complied with up to the
Closing Time;
(E) the representations and warranties of
the Fund and Supremex contained in this
Agreement and in any certificate or
other document delivered pursuant to or
in connection with this Agreement are
true and correct in all material
respects as of the Closing Time with the
same force and effect as if made at and
as of the Closing Time after giving
effect to the transactions contemplated
by this Agreement (except, in each case,
for those representations and warranties
that are subject to a materiality
qualification, which will be true and
correct in all respects); and
(F) such other matters as the Underwriters
may reasonably request;
and each such statement shall be true in fact and
the Underwriters shall not have knowledge of any
fact to the contrary.
(iv) The Underwriters shall have received at the
Closing Time a certificate dated the Closing Date
addressed to the Underwriters and counsel to the
Underwriters and signed by and on behalf of each
of Cenveo and Cenveo US by an officer thereof
acceptable to the Underwriters, certifying for
and on behalf of each of Cenveo and Cenveo US to
its knowledge after having carefully examined the
Prospectus and any Prospectus Amendments:
- 34 -
(A) that each of Cenveo and Cenveo US, as
applicable, has complied in all material
respects with the terms and conditions
of this Agreement on its part to be
complied with up to the Closing Time;
and
(B) that the representations and warranties
of each of Cenveo and Cenveo US, as
applicable, contained in this Agreement
and in any certificate or other document
delivered pursuant to or in connection
with this Agreement (except in respect
of the certificate delivered pursuant to
Section 13(d)(ii)(B)) are true and
correct in all material respects as of
the Closing Time (except for any
representations and warranties with
respect to Cenveo Canada, which shall be
true and correct in all material
respects as of immediately prior to the
amalgamation of Cenveo Canada and
Supremex) with the same force and effect
as if made at and as of the Closing Time
(or as of immediately prior to the
amalgamation of Cenveo Canada and
Supremex, in the case of any
representations and warranties with
respect to Cenveo Canada) after giving
effect to the transactions contemplated
by this Agreement (except, in each case,
for those representations and warranties
that are subject to a materiality
qualification, which will be true and
correct in all respects),
and each such statement shall be true in fact and
the Underwriters shall not have knowledge of any
fact to the contrary.
(d) COMPLETION OF THE CLOSING TRANSACTIONS, EXECUTION OF THE
RELATED AGREEMENTS
(i) The Fund, each of the Material Subsidiaries,
Cenveo and Cenveo US shall have executed prior
to, contemporaneously with or immediately after
the sale of the Purchased Units, as applicable,
each of the Related Agreements to which they are
party, none of the Related Agreements shall have
been terminated in accordance with their
respective terms and the transactions
contemplated by each of the Related Agreements
shall have been completed as described in the
Prospectus prior to, contemporaneous with, or
immediately after the sale of the Purchased
Units, as applicable.
(ii) The Underwriters shall have received at the
Closing Time a certificate dated the Closing Date
addressed to the Underwriters and counsel to the
Underwriters and signed by and on behalf of each
of Cenveo and Cenveo US by an officer thereof
acceptable to the Underwriters, certifying for
and on behalf of each of Cenveo and Cenveo US
that:
(A) the representations and warranties of
each of Cenveo and Cenveo US, as
applicable, contained in Articles 2 and
3 of the Acquisition Agreement are true
and correct in all material respects as
of the Closing Time (except, in each
case, for those
- 35 -
representations and warranties that are
subject to a materiality qualification,
which will be true and correct in all
respects); and
(B) the following affirmations are true and
correct in all material respects as of
immediately prior to the amalgamation of
Cenveo Canada and Supremex (except, in
each case, for those representations and
warranties that are subject to a
materiality qualification, which will be
true and correct in all respects): (x)
the unaudited balance sheet of Cenveo
Canada dated December 31, 2005 presents
fairly, in all material respects, the
consolidated financial position of
Cenveo Canada as of December 31, 2005 in
conformity with GAAP, except as
otherwise indicated in such balance
sheet, (y) except as reflected, reserved
against or otherwise disclosed in the
Cenveo Canada Financial Statements as of
December 31, 2005, Cenveo Canada did not
have any liabilities or obligations that
would have been required to be reflected
by it in the Cenveo Canada Financial
Statements in accordance with GAAP and
that would be reasonably likely to
result in a material adverse effect on
the business, financial condition or
results of operations of Supremex,
Cenveo Canada and its subsidiaries,
taken as a whole, (z) other than in
connection with the Closing Transactions
or as otherwise disclosed in the Final
Prospectus, since December 31, 2005: (1)
there has not been any material adverse
change in the assets, liabilities,
business, financial condition or results
of operations of Cenveo Canada or
Supremex, Cenveo Canada and its
subsidiaries taken as a whole, and (2)
there has not been any acquisition of
all or substantially all of the assets
or properties or of the securities or
business of any other person by Cenveo
Canada or any merger, consolidation or
amalgamation involving Cenveo Canada.
For greater clarity, the representations and
warranties of Cenveo and Cenveo US in favour of
the Fund referred to in the certificate to be
delivered to the Underwriters in accordance with
this paragraph 13(d)(ii) shall not be deemed
representations and warranties of Cenveo or
Cenveo US under this Agreement in favour of the
Underwriters and shall not form the basis of a
Claim giving rise to the application of the
indemnity obligations of Cenveo or Cenveo US set
forth in section 15(b) or to an obligation of
Cenveo or Cenveo US to contribute pursuant to
section 16. Cenveo and Cenveo US shall have no
liability or obligation under this Agreement or
under the Acquisition Agreement for any statement
made in such certificate.
(e) RELEASE OF GUARANTEES AND NEW CREDIT FACILITIES
The Guarantees shall have been released and discharged and the New Credit
Facilities, the terms of which shall be as described in the Prospectus,
shall have been made available to AcquisiCo before, contemporaneously with
or immediately after the sale of the Purchased Units.
- 36 -
(f) LISTING APPROVAL
The Units will have been approved for listing and posted for trading on the
TSX prior to issuance, subject only to the filing of documents in accordance
with the requirements of the TSX.
(g) NECESSARY ACTIONS TAKEN
All actions required to be taken by or on behalf of the Fund, including,
without limitation, the passing of all requisite resolutions of the Trustees
and the unitholders of the Fund, and all requisite filings with any
securities regulatory authority will have occurred at or prior to the
Closing Time so as to validly authorize the execution and filing of the
Prospectus and any Prospectus Amendment and to create and issue the Units
having the attributes contemplated by the Prospectus.
(h) RECEIPT OF ADDITIONAL DOCUMENTS
The Underwriters will have received such other certificates, opinions,
agreements, materials or documents as they may reasonably request.
(i) UNDERWRITERS' OBLIGATION TO PURCHASE OF ADDITIONAL UNITS
The Underwriters' joint (not solidary) obligation to purchase the Additional
Units at the Option Closing Time shall be subject to:
(i) The accuracy of the representations and
warranties of each of the Fund, Supremex, Cenveo
and Cenveo US contained in this Agreement as of
the date of this Agreement and in all material
respects as of the Option Closing Date, or in the
case of any representations and warranties with
respect of Cenveo Canada, as of immediately prior
to the amalgamation of Cenveo Canada and
Supremex, (except, in each case, for those
representations and warranties that are subject
to a materiality qualification, which will be
true and correct in all respects) and the
delivery of certificates dated the Option Closing
Date substantially similar to the certificates
referred to in section 13(c);
(ii) the performance by each of the Fund, Supremex,
Cenveo and Cenveo US of their respective
obligations under this Agreement; and
(iii) the delivery by the Fund, Supremex, Cenveo and
Cenveo US or their professional advisors of such
opinions consistent with those delivered on the
Closing Date, comfort letters and other
certificates as the Underwriters may reasonably
require in respect of the purchase of the
Additional Units.
14. RIGHTS OF TERMINATION
(a) LITIGATION
If any enquiry, action, suit, investigation or other proceeding whether
formal or informal is instituted, threatened or announced or any order is
made by any federal, provincial or other
- 37 -
governmental authority in relation to the Fund, which, in the opinion of any
of the Underwriters, acting reasonably, operates to prevent or restrict the
distribution or trading of the Units, any of the Underwriters shall be
entitled, at their option and in accordance with section 14(e), to terminate
their obligations under this Agreement by notice to that effect given to the
Fund and the Lead Underwriters any time prior to the Closing Time.
(b) MARKET OUT CLAUSE
If prior to the Closing Time:
(i) there should develop, occur or come into effect
or existence any event, action, state, condition
or major financial occurrence of national or
international consequence or any law or
regulation which in the opinion of any of the
Underwriters seriously adversely affects, or
involves, or will seriously adversely affect, or
involve, the financial markets or the business,
operations or affairs of the Fund and the
Material Subsidiaries taken as a whole;
(ii) the state of financial markets in Canada or the
United States is such that, in the reasonable
opinion of the Underwriters (or any of them), the
Units cannot be marketed profitably; or
(iii) if trading in any securities of the Fund has been
suspended or materially limited by any of the
Canadian Securities Regulators or the TSX or if
trading generally on the TSX has been suspended
or materially limited, or minimum or maximum
prices for trading have been fixed, or maximum
ranges for prices have been required, by the TSX
or by order of any of the Canadian Securities
Regulators or any other governmental authority,
any Underwriter shall be entitled, at its option, in accordance with section
14(e), to terminate its obligations under this Agreement by written notice
to that effect given to the Fund at or prior to the Closing Time.
(c) MATERIAL CHANGE OR CHANGE IN MATERIAL FACT
If prior to the Closing Time, there should occur any material change or a
change in, or discovery of, any material fact as contemplated by section 9
which results or, in the opinion of the Underwriters (or any one of them),
is reasonably expected to result, in the purchasers of a material number of
Units exercising their right under applicable legislation to withdraw from
their purchase of Units or, in the reasonable opinion of the Underwriters
(or any one of them), would be expected to have a significant adverse effect
on the market price or value of the Units, any Underwriter shall be
entitled, at its option, in accordance with section 14(e), to terminate its
obligations under this Agreement by written notice to that effect given to
the Fund prior to the Closing Time
If, prior to the Closing Time, there are announced any changes or proposed
changes in the taxation legislation of Canada or of any provinces or
territories of Canada or any changes or proposed changes in the
administration or application of such legislation by any relevant taxing
authority which, in the opinion of the Underwriters after consultation with
the Fund, might
- 38 -
reasonably be expected to have a significant adverse effect on the
marketability of the Units, any of the Underwriters shall be entitled, at
its option and in accordance with section 14(e), to terminate its
obligations under this Agreement by written notice to that effect given to
the Fund prior to the Closing Time.
(d) NON-COMPLIANCE WITH CONDITIONS
Each of the Fund, Supremex, Cenveo and Cenveo US, jointly and not solidarily
between the Fund and Supremex, on the one hand, and Cenveo and Cenveo US, on
the other hand, and solidarily between the Fund and Supremex and solidarily
between Cenveo and Cenveo US, agree that all terms and conditions in section
13 shall be construed as conditions and complied with so far as they relate
to acts to be performed or caused to be performed by it, that it will use
its commercially reasonable efforts to cause such conditions to be complied
with, and that any breach or failure by the Fund, Supremex, Cenveo or Cenveo
US, as the case may be, to comply with any such conditions shall entitle any
of the Underwriters to terminate obligations to purchase the Units by notice
to that effect given to the Fund at or prior to the Closing Time, unless
otherwise expressly provided in this Agreement. Each Underwriter may waive,
in whole or in part, or extend the time for compliance with, any terms and
conditions without prejudice to its rights in respect of any other terms and
conditions or any other or subsequent breach or non-compliance, provided
that any such waiver or extension shall be binding upon an Underwriter only
if such waiver or extension is in writing and signed by the Underwriter.
(e) EXERCISE OF TERMINATION RIGHTS
The rights of termination contained in sections 14(a), (b), (c) and (d), may
be exercised by any of the Underwriters and are in addition to any other
rights or remedies any of the Underwriters may have in respect of any
default, act or failure to act or non-compliance by the Fund, Supremex,
Cenveo or Cenveo US in respect of any of the matters contemplated by this
Agreement or otherwise. In the event of any such termination, there shall be
no further liability on the part of the Underwriters to the Fund or on the
part of the Fund to the Underwriters except in respect of any liability
which may have arisen prior to or arise after such termination under
sections 15, 16 and 18. A notice of termination given by an Underwriter
under sections 14(a), (b), (c) and (d) shall not be binding upon any other
Underwriter.
15. INDEMNITY
(a) RIGHTS OF INDEMNITY BY THE FUND AND SUPREMEX
The Fund and Supremex solidarily agree to indemnify and save harmless each
of the Underwriters and each of their affiliates and each of their
respective directors, officers, employees and agents (collectively, the
"Indemnified Parties" and, individually, an "Indemnified Party") from and
against any and all losses, expenses, claims, actions, damages and
liabilities, joint or solidary, including the aggregate amount paid in
settlement of any actions, suits, proceedings, investigations, inquiries or
claims and the reasonable fees and expenses of their counsel that may be
incurred in advising with respect to and/or defending any action, suit,
proceeding, investigation, inquiry or claim that may be made or threatened
against any Indemnified Party or in enforcing this indemnity to which any
Indemnified Party may become subject or otherwise involved, in any capacity
(collectively, "Claims" and each, individually, a
- 39 -
"Claim"), insofar as the Claims relate to, are caused by, result from, arise
out of or are based upon, directly or indirectly:
(i) any information or statement (except any
statement relating solely to the Underwriters
which has been provided by the Underwriters in
writing specifically for use in the Prospectus or
any Prospectus Amendment) contained in the
Prospectus or any Prospectus Amendment or in any
certificate of the Fund or Supremex delivered
pursuant to this Agreement which at the time and
in light of the circumstances under which it was
made contains or is alleged to contain a
misrepresentation;
(ii) any omission or alleged omission to state in the
Prospectus, any Prospectus Amendment or any
certificate of the Fund or Supremex delivered
pursuant to this Agreement any material fact
(except any fact relating solely to the
Underwriters) required to be stated in such
document or necessary to make any statement in
such document not misleading in light of the
circumstances under which it was made;
(iii) any order made or enquiry, investigation or
proceedings commenced or threatened by any
securities commission or other competent
authority based upon any untrue statement or
omission or alleged untrue statement or alleged
omission or any misrepresentation or alleged
misrepresentation (except a statement which has
been provided by the Underwriters in writing
specifically for use in the Prospectus or any
Prospectus Amendment or omission relating solely
to the Underwriters or alleged untrue statement
which has been provided by the Underwriters in
writing specifically for use in the Prospectus or
any Prospectus Amendment or alleged omission
relating solely to the Underwriters) contained in
the Prospectus or any Prospectus Amendments or
based upon any failure to comply with Canadian
Securities Laws (other than any failure or
alleged failure to comply by the Underwriters),
preventing or restricting the trading in or the
sale or distribution of the Units in any of the
Qualifying Provinces;
(iv) the non-compliance or alleged non-compliance by
the Fund with any of the Canadian Securities Laws
or the 1933 Act including the Fund's
non-compliance with any statutory requirement to
make any document available for inspection; or
(v) any breach by the Fund or Supremex of its
representations, warranties, covenants or
obligations to be complied with under this
Agreement.
(b) RIGHTS OF INDEMNITY BY CENVEO US AND CENVEO
Each of Cenveo and Cenveo US (collectively with the Fund and Supremex, the
"Indemnifiers") agrees to solidarily indemnify and save harmless each of the
Indemnified Parties from and against any and all Claims, insofar as the
Claims relate to, are caused by, result from, arise out of or are based
upon, directly or indirectly, any breach by Cenveo or Cenveo US of any of
their representations, warranties, covenants or obligations to be complied
with under this Agreement.
- 40 -
Notwithstanding anything set forth in this section 15, the liability of each
of Cenveo and Cenveo US in respect of any indemnification obligation
pursuant to this section 15(b) shall be limited as follows:
(i) the obligations of indemnification of any of
Cenveo and Cenveo US as an Indemnifier will, with
respect to an individual matter or series of
related matters, be subject to an initial
aggregate threshold of $50,000;
(ii) the obligations of indemnification of any of
Cenveo and Cenveo US as an Indemnifier will be
subject to an initial aggregate threshold of
$1,500,000 whereupon an initial deductible of
$1,000,000 shall apply; and
(iii) the aggregate liability of any of Cenveo and
Cenveo US as an Indemnifier pursuant to section
15(b) shall not exceed the amount to which the
aggregate liability of any of Cenveo and Cenveo
US under section 7.2(a) of the Acquisition
Agreement is limited pursuant to item (x) of
paragraph 7.2(a) in fine of the Acquisition
Agreement as if the reference to one-half of the
sum described therein was changed to 100% of such
sum.
Neither Cenveo and Cenveo US shall be liable pursuant to such indemnity as
it relates to a breach of the representations and warranties set forth in
Section 5(c)(xi) if in a public offering of securities they would be able to
establish a due diligence defence (of the nature provided under Canadian
law) to a similar obligation.
(c) NOTIFICATION OF CLAIMS
If any Claim is asserted against any Indemnified Party in respect of which
indemnification is or might reasonably be considered to be provided, such
Indemnified Party will promptly after the date of the receipt by the
Indemnified Party or any of its Affiliate of notice of, or of the
Indemnified Party or any of its Affiliates otherwise becoming aware of, any
such Claim (whether such Claim is asserted or indemnification might be
reasonably be considered to be provided) notify the Indemnifiers of the
nature of such Claim (the omission so to notify the Indemnifiers of any
potential Claim shall relieve the Indemnifiers from any liability which it
may have to any Indemnified Party and any omission so to notify the
Indemnifiers of any actual Claim shall affect the Indemnifiers' liability
only to the extent that the Indemnifiers are prejudiced by that failure).
The Indemnifiers shall assume the defence of any suit brought to enforce
such Claim (in the event Cenveo and/or Cenveo US, on the one hand, and the
Fund and/or Supremex, on the other hand, are Indemnifiers with respect to
the defence of any Claim pursuant to which indemnification is provided
hereunder, it is understood that Cenveo and Cenveo US shall have sole
control over any suit brought to enforce such Claim, provided that in each
case Cenveo and Cenveo US shall allow the Fund and/or Supremex to provide
input to such suit and shall keep the Fund and/or Supremex informed
regarding its progress); provided, however, that:
(i) the defence shall be conducted through legal
counsel reasonably acceptable to the Indemnified
Party, and
(ii) no settlement of any such Claim or admission of
liability may be made by the Indemnifiers without
the prior written consent (such consent not to be
unreasonably withheld or delayed) of the
Indemnified Party, acting
- 41 -
reasonably, unless such settlement includes an
unconditional release of the Indemnified Party
from all liability arising out of such action or
claim and does not include a statement as to or
an admission of fault, culpability or failure to
act, by or on behalf of any Indemnified Party.
After written notice by the Indemnifier to the Indemnified Party of its
election to assume the defence of any such suit, the Indemnifier shall not
be liable hereunder to indemnify any person for any legal costs or expenses
subsequently incurred in connection therewith.
The Indemnified Party and the Indemnifier shall each cooperate fully (and
shall each cause its Affiliates to cooperate fully) with the other in the
defence of any Claim pursuant to which indemnification is provided
hereunder. Without limiting the generality of the foregoing, each such
person shall furnish to the other person (at the expense of the Indemnifier)
such documentary or other evidence as is then in its or any of its
Affiliates' possession as may reasonably be requested by the other person
for the purpose of defending against any such Claim.
(d) RIGHT OF INDEMNITY IN FAVOUR OF OTHERS
With respect to any Indemnified Party who is not a party to this Agreement,
the Underwriters shall obtain and hold the rights and benefits of this
section in trust for and on behalf of such Indemnified Party.
(e) RETAINING COUNSEL
In any such Claim, the Indemnified Party shall have the right to retain
other counsel to act on his or its behalf, provided that the fees and
disbursements of such counsel shall be paid by the Indemnified Party unless:
(i) the Fund, Cenveo and the Indemnified Party shall have mutually agreed to
the retention of the other counsel; (ii) the named parties to any such Claim
(including any added third or impleaded party) include both the Indemnified
Party and an Indemnifier and the representation of both parties by the same
counsel would be inappropriate due to the actual or potential differing
interests between them; or (iii) the Indemnifiers shall not have retained
counsel within seven (7) Business Days following receipt by the Fund of
notice of any such Claim from the Indemnified Party.
(f) NO DOUBLE RECOVERY
Notwithstanding anything set forth in this Agreement, the obligations of the
Indemnifiers pursuant to this section 15 or section 16 will be limited such
that no double recovery by any person shall be permitted under this
Agreement, the Acquisition Agreement or the Cenveo Xxxxx Acquisition
Agreement as a result of any action that gives rise to a claim under more
than one of these agreements.
16. CONTRIBUTION
(a) RIGHTS OF CONTRIBUTION
In order to provide for a just and equitable contribution in circumstances
in which the indemnity provided in section 15 would otherwise be available
in accordance with its terms but is, for any reason, held to be unavailable
to or unenforceable by the Underwriters or enforceable otherwise
- 42 -
than in accordance with its terms, the Fund, Supremex, Cenveo, Cenveo US and
the Underwriters, jointly and not solidarily (but solidarily between the
Fund and Supremex and solidarily between Cenveo and Cenveo US), shall
contribute to the aggregate of all claims, expenses, costs and liabilities
and all losses of a nature contemplated by section 15 in such proportions as
is appropriate to reflect: (i) as between the Fund and Supremex, on the one
hand, and the Underwriters, on the other hand, the relative fault of the
Fund and Supremex, on the one hand, and the Underwriters, on the other hand;
and (ii) as between Cenveo and Cenveo US, on the one hand, and the
Underwriters, on the other hand, the cash proceeds ultimately received by
Cenveo and Cenveo US from this Agreement and the Related Agreements, on the
one hand, and the underwriting fees received by the Underwriters from the
offering of the Units, on the other hand. Relative fault shall be determined
by reference to, among other things, the intent of such parties and their
relative knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The Fund, Supremex, Cenveo,
Cenveo US and the Underwriters agree that it would not be just and equitable
if contribution were determined by pro rata allocation or any other method
of allocation which does not take account of the equitable considerations
referred to above. Notwithstanding the provisions of this section 16(a), (A)
the Underwriters shall not in any event be liable to contribute, in the
aggregate, any amounts in excess of the aggregate Underwriting Fee or any
portion of the Underwriting Fee actually received; (B) Cenveo and Cenveo US
shall not in any event be liable to contribute any amounts in excess of the
limits set forth in section 15(b); and (C) no party who has been determined
by a court of competent jurisdiction, in a final non-appealable judgment, to
have engaged in any fraud, fraudulent misrepresentation, wilful misconduct,
reckless disregard or intentional fault shall be entitled to claim
contribution from any person who has not also been determined by a court of
competent jurisdiction, in a final non-appealable judgment, to have engaged
in such fraud, fraudulent misrepresentation wilful misconduct, reckless
disregard or intentional fault. For purposes of this section 16, each person
who controls an Underwriter within the meaning of Canadian Securities Laws
and each director, officer, employee and agent of an Underwriter shall have
the same rights to contribution as such Underwriter; each officer of the
Fund and Supremex, as applicable, who shall have signed the Prospectus and
each trustee of the Fund and each director of Supremex shall have the same
rights to contribution as the Fund or Supremex, as applicable; and each
officer of Cenveo who shall have signed the Prospectus and each director of
Cenveo and Cenveo US shall have the same rights to contribution as Cenveo or
Cenveo US, as applicable, subject in each case to the applicable terms and
conditions of this section 16.
(b) RIGHTS OF CONTRIBUTION IN ADDITION TO OTHER RIGHTS
The rights to contribution provided in this section 16 shall be in addition
to and not in derogation of any other right to contribution which the
Underwriters, Cenveo or Cenveo US may have by statute or otherwise at law.
(c) CALCULATION OF CONTRIBUTION
In the event that an Indemnifier may be held to be entitled to contribution
from the Underwriters under the provisions of any statute or at law, the
Indemnifier shall be limited to contribution in an amount not exceeding the
lesser of:
(i) the portion of the full amount of the loss or
liability giving rise to such contribution for
which the Underwriters are responsible, as
determined in section 16(a) or (b), as the case
may be, and
- 43 -
(ii) the amount of the Underwriting Fee actually
received by the Underwriters under this
Agreement,
and an Underwriter shall in no event be liable to contribute any amount in
excess of such Underwriter's portion of the Underwriting Fee actually
received under this Agreement.
(d) NOTICE
If the Underwriters have reason to believe that a claim for contribution may
arise, they shall give the Indemnifier notice of such claim in writing, as
soon as reasonably possible, but failure to notify the Indemnifier shall not
relieve the Indemnifier of any obligation which he or it may have to the
Underwriters under this section.
(e) RIGHT OF CONTRIBUTION IN FAVOUR OF OTHERS
With respect to this section, the Indemnifiers acknowledge and agree that
the Underwriters are contracting on their own behalf and as agents for their
affiliates, directors, officers, employees and agents.
(f) LIMITATION ON CONTRIBUTION
(i) Notwithstanding anything in this Agreement to the
contrary: (i) the Fund and Supremex acknowledge
and agree that they do not have any right of
indemnification, contribution or reimbursement
from or remedy against Cenveo or Cenveo US as a
result of any indemnification they are required
to make under or arising out of the breach or
inaccuracy by the Fund or Supremex of any
representation, warranty, covenant or other
obligation under this Agreement, and (ii) the
Fund and Supremex hereby release, waive and
forever discharge any right to indemnification,
contribution or reimbursement that they may have
at any time against Cenveo or Cenveo US under or
arising out of the breach or inaccuracy of any
representation, warranty, covenant or other
obligation under this Agreement. The Fund and
Supremex acknowledge and agree that they will be
fully responsible for their own indemnification
obligations hereunder.
(ii) Notwithstanding anything in this Agreement to the
contrary: (i) Cenveo and Cenveo US acknowledge
and agree that they do not have any right of
indemnification, contribution or reimbursement
from or remedy against the Fund or Supremex as a
result of any indemnification they are required
to make under or arising out of the breach or
inaccuracy by Cenveo or Cenveo US of its
representations and warranties pursuant to
Sections 5(c)(i) to (x) inclusively, and (ii)
Cenveo or Cenveo US hereby release, waive and
forever discharge any right to indemnification,
contribution or reimbursement that they may have
at any time against the Fund or Supremex under or
arising out of the breach or inaccuracy of such
representations and warranties under this
Agreement. Cenveo and Cenveo US acknowledge and
agree that they will be fully responsible for
their own indemnification obligations with
respect to the above-mentioned representations
and warranties hereunder.
- 44 -
17. SEVERABILITY
If any provision of this Agreement is determined to be void or unenforceable
in whole or in part, it shall be deemed not to affect or impair the validity
of any other provision of this Agreement and such void or unenforceable
provision shall be severable from this Agreement.
18. EXPENSES
Whether or not the transactions contemplated by this Agreement shall be
completed, all expenses of or incidental to the issue, sale and delivery of
the Units and all expenses of or incidental to all other matters in
connection with the transaction set out in this Agreement shall be caused by
the Fund to be borne by AcquisiCo directly including, without limitation,
fees and expenses payable in connection with the qualification of the Units
for distribution, the fees relating to listing the Units on any exchanges,
the fees and expenses of counsel to the Fund, all fees and expenses of local
counsel, all fees and expenses of the Fund's auditors and all costs incurred
in connection with the preparation and printing of the Prospectus,
Prospectus Amendments and certificates representing the Units. The fees,
taxes and disbursements of counsel to the Underwriters and all reasonable
out-of-pocket expenses of the Underwriters incurred by the Underwriters in
connection with the transactions contemplated by this Agreement, up to a
maximum of $800,000, shall be caused by the Fund to be borne by AcquisiCo,
provided that if the sale of the Units is not completed in accordance with
the terms of this Agreement, all such fees and expenses shall be borne by
Cenveo. If the transactions contemplated by this Agreement are completed,
the amount of expenses for which the Fund shall cause AcquisiCo to be
responsible to the Underwriters pursuant to the immediately preceding
sentence will be reduced by 10% and the Underwriters will pay such expenses.
19. RIGHTS TO PURCHASE
(a) OBLIGATION OF UNDERWRITERS TO PURCHASE
The obligation of the Underwriters to purchase the Purchased Units or the
Additional Units, as the case may be at the Closing Time or on the Option
Closing Date, as the case may be, shall be joint and not solidary and shall
be limited to the percentage of the Purchased Units or the Additional Units,
as the case may be, set out opposite the name of the Underwriters
respectively below:
TD SECURITIES INC. 28%
CIBC WORLD MARKETS INC. 22%
BMO XXXXXXX XXXXX INC. 11%
DESJARDINS SECURITIES INC. 11%
NATIONAL BANK FINANCIAL INC. 11%
SCOTIA CAPITAL INC. 11%
CANACCORD CAPITAL CORPORATION 3%
GENUITY CAPITAL MARKETS G.P. 3%
- 45 -
Subject to section 19(c), in the event that any of the Underwriters shall
fail to purchase its applicable percentage of the Purchased Units or the
Additional Units, as the case may be, at the Closing Time or on the Option
Closing Date, as the case may be, the others shall be obligated, jointly
(not solidarily), to purchase on a pro rata basis all of the percentage of
the Purchased Units or the Additional Units, as the case may be, that would
otherwise have been purchased by the defaulting Underwriter(s); provided,
however, that in the event that the percentage of the total number of
Purchased Units or Additional Units, as the case may be, which the
defaulting Underwriter(s) has failed to purchase exceeds 12% of the total
number of Purchased Units or Additional Units, as the case may be, which the
Underwriters have agreed to purchase, the other Underwriters shall have the
right, but shall not be obligated, to purchase on a pro rata basis all of
the percentage of the total number of Purchased Units or Additional Units,
as the case may be, that would otherwise have been purchased by the
defaulting Underwriter(s). In the event that such right is not exercised,
the other Underwriters which are not in default shall be relieved of all
obligations to the Fund. Nothing in this section 19(a) shall oblige the Fund
to sell to the Underwriters less than all of the Purchased Units or the
Additional Units, as the case may be, or relieve from liability to the Fund
any Underwriter which shall be so in default. In the event of a termination
by the Fund of its obligations under this Agreement, there shall be no
further liability on the part of the Fund to the Underwriters except in
respect of any liability which may have arisen or may arise under sections
15, 16 and 18.
(b) PURCHASES BY OTHER UNDERWRITERS
If the amount of the Purchased Units or the Additional Units, as the case
may be, which the remaining Underwriters wish to purchase exceeds the amount
of the Purchased Units or the Additional Units, as the case may be, which
would otherwise have been purchased by an Underwriter which is in default,
such Purchased Units or the Additional Units, as the case may be, shall be
divided pro rata among the Underwriters desiring to purchase such Purchased
Units or the Additional Units, as the case may be, in proportion to the
percentage of Purchased Units or the Additional Units, as the case may be,
which such Underwriters have agreed to purchase as set out in section 19(a).
(c) RIGHTS TO PURCHASE OF OTHER UNDERWRITERS
In the event that one or more but not all of the Underwriters shall exercise
their right of termination under section 14 the others shall have the right,
but shall not be obligated, to purchase all of the percentage of the
Purchased Units or the Additional Units, as the case may be, which would
otherwise have been purchased by such Underwriters which have so exercised
their right of termination. If the amount of such Purchased Units or the
Additional Units, as the case may be, which the remaining Underwriters wish,
but are not obliged, to purchase exceeds the amount of such Purchased Units
or the Additional Units, as the case may be, which remain available for
purchase, such Purchased Units or the Additional Units, as the case may be,
shall be divided pro rata among the Underwriters desiring to purchase such
Purchased Units or the Additional Units, as the case may be, in proportion
to the percentage of Purchased Units or the Additional Units, as the case
may be, which such Underwriters have agreed to purchase as set out in
section 19.
- 46 -
(d) RIGHT OF FUND TO TERMINATE
Nothing in this section or section 14 shall oblige the Fund to sell to the
Underwriters less than all of the Purchased Units or the Additional Units,
as the case may be.
20. CONCURRENT OFFERINGS
Subject to the exercise of the over-allotment option, the Fund shall not,
without the prior written consent of the Lead Underwriters, which consent
shall not be unreasonably withheld, directly or indirectly, issue, sell,
grant any option for the sale of, or otherwise dispose of or monetize, in a
public offering, by way of private placement or otherwise, any units of the
Fund or any securities convertible or exchangeable into units of the Fund or
offer to or announce any intention to do any of the foregoing, during the
period commencing on the date hereof and ending 180 days after the Closing
Date, other than the issuance of securities of the Fund pursuant to employee
or executive incentive compensation arrangements or in connection with an
acquisition transaction. Notwithstanding anything to the contrary in this
Agreement, the Fund shall not issue any units of the Fund or any securities
convertible or exchangeable into units of the Fund until the Over-Allotment
Note has been repaid in accordance with its terms (other than any units of
the Fund issued to Cenveo US in repayment of such Over-Allotment Note).
For a period of 225 days after the Closing Date, Cenveo US shall not,
without the prior written consent of the Lead Underwriters, in their sole
discretion, offer, sell transfer, contract to sell or otherwise dispose of,
directly or indirectly, any units of the Fund or any securities convertible
or exchangeable into units of the Fund (including any units of the Fund
issued to Cenveo US should the over-allotment option not be exercised) or
make any short sale, engage in any hedging transaction or enter into any
swap or other arrangement that has the effect of transferring, in whole or
in part, any of the economic consequences of ownership of any of those
securities, whether such transaction is to be settled by the delivery of
units of the Fund, other securities, cash or otherwise, or agree to do so.
Notwithstanding anything to the contrary in this Agreement, (a) Cenveo US
may pledge its units of the Fund as security in favour of the lenders under
the secured credit facility described in section 5(c)(iii)(x) and such
lenders will be permitted to foreclose on such units, provided that such
lenders acknowledge that such pledged units shall be subject to the
restrictions on disposition contained in this paragraph, and (b) Cenveo US
may transfer any units of the Fund to an Affiliate, provided that the
transferee shall first undertake to the Co-Lead Underwriters by means of a
duly executed contract to comply with the obligations set out in this
section 20 as if that transferee were an original party to the undertakings
and agreements of Cenveo US contained in this section 20.
21. STABILIZATION
In connection with the distribution of the Units, the Underwriters and
members of their selling group (if any) may over-allot or effect
transactions which stabilize or maintain the market price of the Units at
levels other than those which might otherwise prevail in the open market, in
compliance with applicable securities laws and the rules and regulations of
applicable stock exchanges. Those stabilizing transactions, if any, may be
discontinued at any time.
- 47 -
22. TIME
Time is of the essence in the performance of the parties' respective
obligations under this Agreement and the mere lapse of time shall have the
effects contemplated hereunder and by law.
23. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
laws of the Province of Quebec and the laws of Canada applicable in the
Province of Quebec. Any judicial proceeding brought against any of the
parties to this Agreement with respect to any dispute arising out of this
Agreement or any matter related hereto may be brought only in the courts of
Quebec, district of Montreal, and by execution and delivery of this
Agreement, each of the parties to this Agreement accepts for itself the
exclusive jurisdiction in the aforesaid courts and irrevocably agrees to be
bound by any judgment rendered thereby in connection with this Agreement.
Each of Cenveo and Cenveo US has appointed Stikeman Elliott LLP, 1155
Xxxx-Xxxxxxxx Blvd. West, 40th Floor, Xxxxxxxx, Xxxxxx, X0X 0X0, as its
authorized agent (the "Authorized Agent") upon whom process may be served in
any action arising out of or based on this Agreement or the transactions
contemplated thereby. Such appointment shall be irrevocable. Each of Cenveo
and Cenveo US represents and warrants that the Authorized Agent has agreed
to act as such agent for service of process and agrees to take any and all
action, including the filing of any and all documents and instruments, that
may be necessary to continue such appointment in full force and effect as
aforesaid. Service of process upon the Authorized Agent and written notice
of such service to each of Cenveo and Cenveo US shall be deemed, in every
respect, effective service of process upon the Cenveo or Cenveo US, as
applicable.
24. NOTICE
Unless otherwise expressly provided in this Agreement, any notice or other
communication to be given under this Agreement (a "notice") shall be in
writing addressed as follows:
If to the Fund or Supremex, addressed and sent to:
Supremex Inc.
0000 Xxxxxxx
Xxxxxxx, Xxxxxx
Xxxxxx
X0X 0X0
Attention: Xxxxxx Xxx
Facsimile: (000) 000-0000
with a copy to:
Stikeman Elliott LLP
0000 Xxxx-Xxxxxxxx Xxxx. Xxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxx
X0X 0X0
Attention: Xxxxxxxxx Xxx
Facsimile: (000) 000-0000
- 48 -
If to Cenveo or Cenveo US, addressed and sent to:
Cenveo, Inc.
One Canterbury Green
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx
Xxxxxx Xxxxxx of America
06901
Attention: General Counsel
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx & Xxxx LLP
Xxx Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx
Xxxxxx Xxxxxx of America
10004-1482
Attention: Xxxxxxx X. Xxxxxxxxx
Facsimile: (000) 000-0000
If to the Lead Underwriters, addressed and sent to:
TD Securities Inc.
00 Xxxxxxxxxx Xxxxxx Xxxx
0xx Xxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxxx Xxxxxxxx
Facsimile: (000) 000-0000
and to:
CIBC World Markets Inc.
000 xx Xxxxxxxxxxx Xxxx. Xxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxx
X0X 0X0
Attention: Xxxx Xxxxxxxx
Facsimile: (000) 000-0000
- 49 -
with a copy to:
Osler, Xxxxxx & Harcourt LLP
1000 de la Gauchetiere Street West
Suite 2100
Xxxxxxxx, Xxxxxx
X0X 0X0
Attntion: Xxxx Xxxxxxx
Facsimile: (000) 000-0000
or to such other address as any of the parties may designate by giving
notice to the others in accordance with this section 24.
Each notice shall be personally delivered to the addressee or sent by fax to
the addressee and:
(a) a notice which is personally delivered shall, if delivered
on a Business Day, be deemed to be given and received on
that day and, in any other case, be deemed to be given and
received on the first Business Day following the day on
which it is delivered; and
(b) a notice which is sent by fax shall be deemed to be given
and received on the first Business Day following the day
on which it is sent.
25. AUTHORITY OF LEAD UNDERWRITERS
The Lead Underwriters are hereby authorized by each of the other
Underwriters to act on its behalf and the Fund shall be entitled to and
shall act on any notice given in accordance with section 24 or agreement
entered into by or on behalf of the Underwriters by the Lead Underwriters
which represents and warrants that they have irrevocable authority to bind
the Underwriters, except in respect of any consent to a settlement pursuant
to section 15(c) which consent shall be given by the Indemnified Party, a
notice of termination pursuant to section 14 which notice may be given by
any of the Underwriters, or any waiver pursuant to section 14(d), which
waiver must be signed by all of the Underwriters. The Lead Underwriters
shall consult where practical with the other Underwriters concerning any
matter in respect of which it acts as representative of the Underwriters.
26. ENUREMENT
This Agreement shall enure to the benefit of and be binding upon the parties
and their respective successors (including any successor by reason of
amalgamation of any party).
27. COUNTERPARTS
This Agreement may be executed by the parties to this Agreement in
counterpart and may be executed and delivered by facsimile and all such
counterparts and facsimiles shall together constitute one and the same
agreement.
- 50 -
If the foregoing is in accordance with your understanding and is agreed to
by you, please signify your acceptance by executing the enclosed copies of
this letter where indicated below and returning the same to the Lead
Underwriters upon which this letter as so accepted shall constitute an
Agreement among us.
Yours very truly,
TD SECURITIES INC. CIBC WORLD MARKET INC.
By: /s/ Xxxxxx Xxxxxxxx By: /s/ Xxxx Xxxxxxxx
----------------------------------- --------------------------------------
Name: Xxxxxx Xxxxxxxx Name: Xxxx Xxxxxxxx
Title: Vice-President and Director Title: Managing Director
BMO XXXXXXX XXXXX INC. DESJARDINS SECURITIES INC.
By: /s/ Pierre-Xxxxxxx Xxxxxx By: /s/ Xxxx-Xxxxxxxx Xxxxx
----------------------------------- --------------------------------------
Name: Pierre-Xxxxxxx Xxxxxx Name: Xxxx-Xxxxxxxx Xxxxx
Title: Vice-President Title: Vice-President and Director
NATIONAL BANK FINANCIAL INC. SCOTIA CAPITAL INC.
By: /s/ Xxxx St-Xxxxxx By: /s/ Xxxx Xxxxxxx
----------------------------------- --------------------------------------
Name: Xxxx St-Xxxxxx Name: Xxxx Xxxxxxx
Title: Managing Director Title: Director
CANACCORD CAPITAL CORPORATION GENUITY CAPITAL MARKETS G.P.
By: /s/ Xxxx-Xxxx Xxxxxxxxx By: /s/ Xxxx Xxxxxxxx
----------------------------------- --------------------------------------
Name: Xxxx-Xxxx Xxxxxxxxx Name: Xxxx Xxxxxxxx
Title: Managing Director Title: Principal
- 51 -
The foregoing offer is accepted and agreed to as of the date first above
written.
SUPREMEX INCOME FUND SUPREMEX INC.
By: /s/ Xxxxxx Xxx By: /s/ Xxxxxx Xxx
----------------------------------- --------------------------------------
Name: Xxxxxx Xxx Name: Xxxxxx Xxx
Title: Trustee Title: President
CENVEO, INC. CENVEO CORPORATION
By: /s/ Xxxx X. Xxxxxxxx By: /s/ Xxxx X. Xxxxxxxx
----------------------------------- --------------------------------------
Name: Xxxx X. Xxxxxxxx Name: Xxxx X. Xxxxxxxx
Title: Chief Financial Officer Title: Chief Financial Officer
SCHEDULE A
RULE 144A SALES IN THE UNITED STATES
1. In this Schedule, "Units" means the Purchased Units.
2. The Fund hereby represents, warrants, covenants and agrees
to and with the Underwriters that:
(a) The Fund is a "foreign issuer" and reasonably believes
that there is no "substantial U.S. market interest" with
respect to the Units as such terms are defined in
Regulation S.
(b) None of the Fund, its subsidiaries or its affiliates or
any person acting on its or their behalf (other than the
Underwriters, their subsidiaries or affiliates or any of
the Selling Firms, in respect of whose activities the Fund
makes no representation) has engaged or will engage in any
directed selling efforts in the United States (within the
meaning of Regulation S) or has engaged or will engage in
any form of general solicitation or general advertising in
the United States (as those terms are defined in
Regulation D under the 1933 Act ("Regulation D")) with
respect to the Units or has sold, offered for sale,
solicited offers to buy or otherwise negotiated in respect
of, any security (as defined in the 1933 Act) which is or
will be integrated with the sale of the Units in a manner
that would require the registration thereof under the 1933
Act.
(c) the Units are not, and as of the Closing Date the Units
will not be, and no securities of the same class as the
Units are, or as of the Closing Date will be, (i) listed
on a national securities exchange registered under Section
6 of the 1934 Act, or (ii) quoted in an "automated
interdealer quotation system", as such term is used in the
1934 Act, or (iii) convertible or exchangeable at an
effective conversion premium (calculated as specified in
paragraph (a)(6) of Rule 144A) of less than ten percent
for securities so listed or quoted.
(d) so long as any Units are outstanding and are "restricted
securities" within the meaning of Rule 144(a)(3) under the
1933 Act, and the Fund is neither exempt from reporting
pursuant to Rule 12g3-2(b) under the 1934 Act, nor subject
to and in compliance with Section 13 or 15(d) of the 1934
Act, to furnish U.S. holders of the Units and prospective
U.S. purchasers of Units designated by such U.S. holders,
upon the request of such U.S. holder, the information
required to be delivered pursuant to Rule 144A(d)(4) under
the 1933 Act to permit compliance with Rule 144A in
connection with the resale of Units in the United States.
- 2 -
(e) the Fund is not and, as a result of the sale of the Units
will not be, an open-end investment company, unit
investment trust or face-amount certificate company that
is or is required to be registered under Section 8 of the
United States Investment Company Act of 1940, as amended.
(f) The Units satisfy the requirements set out in Rule
144A(d)(3) under the 0000 Xxx.
3. Each of the Underwriters represents and warrants to and with the
Fund that:
(a) it acknowledges that the Units have not been and will not
be registered under the 1933 Act and may not be offered or
sold within the United States except pursuant to the
exemption from the registration requirements of the 1933
Act. It has not offered or sold, and will not offer or
sell, any of the Units constituting part of its allotment
except in accordance with Regulation S or Rule 144A as
provided in paragraphs 5 and 6 below.
(b) it has not entered and will not enter into any contractual
arrangement with respect to the distribution of the Units,
except with its affiliates, any Selling Firm or with the
prior written consent of the Fund.
4. The Underwriters shall require each Selling Firm to agree, for the
benefit of the Fund to comply with, and shall use their best
efforts to ensure that each Selling Firm complies with, the
provisions of clauses 5 and 6 hereof above as if such provisions
applied to such Selling Firm.
5. Each of the Underwriters agrees with the Fund that:
(a) all offers and sales of the Units in the United States
will be effected through its U.S. affiliate in accordance
with all applicable U.S. broker-dealer requirements.
(b) it and any U.S. affiliate selling Units in the United
States is a Qualified Institutional Buyer.
(c) it will not, either directly or through its U.S.
affiliate, solicit offers for, or offer to sell, the Units
in the United States by means of any form of general
solicitation or general advertising (as those terms are
used in Regulation D) or in any manner involving a public
offering within the meaning of Section 4(2) of the 1933
Act and neither it nor its U.S. affiliate(s) nor any
persons acting on its or their behalf have engaged or will
engage in any directed selling efforts (within the meaning
of Regulation S) in the United States with respect to the
Units.
(d) it will solicit, and will cause its U.S. affiliate to
solicit, offers for the Units in the United States only
from, and will offer the Units only to, persons it
reasonably believes to be Qualified Institutional Buyers
in accordance with Rule 144A. It also agrees that it will
solicit offers for the Units only from, and will offer the
Units only to, persons that in purchasing such Units will
be deemed to have represented and agreed as provided in
clauses (f)(i) through (iv) below (to the extent such
representations are applicable to the purchaser
concerned).
- 3 -
(e) It will inform, and cause its U.S. affiliate to inform,
all purchasers of the Units in the United States that the
Units have not been and will not be registered under the
1933 Act and are being sold to them without registration
under the 1933 Act in reliance on Rule 144A.
(f) The U.S. Placement Memorandum for the offering of the
Units in the United States shall contain disclosure
substantially in the form set out below:
"The Units have not been and will not be
registered under the Securities Act or under any
state securities laws of the United States and
may not be offered or sold within the United
States except to persons reasonably believed by
the Underwriters (and the U.S. Dealers) to be
Qualified Institutional Buyers in transactions
exempt from the registration requirements of the
Securities Act pursuant to Rule 144A and in
compliance with applicable state securities laws.
In addition, until 40 days after the commencement
of the offering of the Units, an offer or sale of
the Units within the United States by any dealer
(whether or not participating in the offering)
may violate the registration requirements of the
Securities Act if such an offer or sale is made
otherwise than in accordance with the applicable
provisions of Rule 144A.
Each U.S. purchaser of Units offered hereby will,
by its purchase of such Units, be deemed to have
represented and agreed for the benefit of the
Fund, the Underwriters and the U.S. Dealers as
follows:
It is authorized to consummate the purchase of
the Units.
It is a Qualified Institutional Buyer and
acknowledges that the sale of the Units to it is
being made in reliance on Rule 144A and
exemptions from applicable state securities laws,
and it is acquiring the Units for its own account
or for the account of one or more Qualified
Institutional Buyers with respect to which it
exercises sole investment discretion, and not
with a view to any resale, distribution, or other
disposition of the Units in violation of U.S.
federal or state securities laws.
It acknowledges that it has not purchased the
Units as a result of any general solicitation or
general advertising (as defined in Regulation D
under the Securities Act), including, without
limitation, advertisements, articles, notices, or
other communications published in any newspaper,
magazine or similar media, or broadcast over
radio or television, or any seminar or meeting
whose attendees have been invited by general
solicitation or general advertising.
It understands and acknowledges that the Units
have not been and will not be registered under
the Securities Act or the securities laws of any
state of the United States, and are therefore
"restricted securities" as defined in Rule 144
under the Securities Act and that if it decides
to offer, sell, pledge or otherwise transfer such
securities, such securities may be offered, sold,
pledged or otherwise transferred only (A) to the
Fund, (B) outside the United States in accordance
with Rule 904 of Regulation S under the
Securities Act, (C) inside the United States in
accordance with (i) Rule 144A to a person who it
reasonably believes is a Qualified Institutional
Buyer that is purchasing for its own account or
for the account of a Qualified Institutional
Buyer and to whom notice is given that the offer,
sale or transfer is being made in reliance on
Rule 144A, or (ii) the exemption from
registration under the Securities Act provided by
Rule 144 thereunder, if available, or (D) under
another exemption from registration under the
Securities Act, and in each case in accordance
with any applicable state securities laws in the
United States or securities laws of any other
applicable jurisdiction and in the case of
(C)(ii) or (D) upon provision
- 4 -
of a legal opinion from U.S. legal counsel
reasonably satisfactory to the Fund that such
exemption from registration is available.
It understands and acknowledges that upon the
original issuance thereof, and until such time as
the same is no longer required under applicable
requirements of the Securities Act or applicable
state securities laws, that all certificates
representing the Units sold in the U.S. Placement
will bear the following legend:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN,
AND WILL NOT BE, REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR UNDER ANY STATE SECURITIES
LAWS OF THE UNITED STATES. THE HOLDER HEREOF, BY
PURCHASING SUCH SECURITIES, AGREES FOR THE
BENEFIT OF THE SUPREMEX INCOME FUND (THE "FUND")
THAT SUCH SECURITIES MAY BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE
FUND, (B) OUTSIDE THE UNITED STATES IN ACCORDANCE
WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, (C) INSIDE THE UNITED STATES IN
ACCORDANCE WITH (1) RULE 144A UNDER THE
SECURITIES ACT TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT, A "QIB") THAT IS PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB AND
TO WHOM NOTICE IS GIVEN THAT THE OFFER, SALE OR
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A
OR (2) THE EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER,
IF AVAILABLE, OR (D) UNDER ANOTHER EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT, AND IN
EACH CASE IN ACCORDANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS IN THE UNITED STATES OR
SECURITIES LAWS OF ANY OTHER APPLICABLE
JURISDICTION AND IN THE CASE OF (C)(2) OR (D)
UPON PROVISION OF A LEGAL OPINION FROM U.S. LEGAL
COUNSEL REASONABLY SATISFACTORY TO THE FUND THAT
SUCH EXEMPTION FROM REGISTRATION IS AVAILABLE.
DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE
"GOOD DELIVERY" IN SETTLEMENT OF TRANSACTIONS ON
STOCK EXCHANGES IN CANADA. A NEW CERTIFICATE
BEARING NO LEGEND, DELIVERY OF WHICH WILL
CONSTITUTE "GOOD DELIVERY" MAY BE OBTAINED FROM
THE REGISTRAR AND/OR TRANSFER AGENT OF THE FUND
(THE "TRANSFER AGENT") UPON DELIVERY OF THIS
CERTIFICATE AND A DULY EXECUTED DECLARATION, IN A
FORM SATISFACTORY TO THE TRANSFER AGENT AND THE
COMPANY, TO THE EFFECT THAT THE SALE OF THE
SECURITIES REPRESENTED HEREBY IS BEING MADE IN
COMPLIANCE WITH RULE 904 OF REGULATION S UNDER
THE SECURITIES ACT;
provided, that, if any such securities are being
--------
sold under outside of the United States in
accordance with Rule 904 of Regulation S, at a
time when the Fund is a "foreign issuer" as
defined in Rule 902 of Regulation S, the legend
may be removed by providing a declaration to the
transfer agent for the securities, or such other
organization or entity performing such function
for the Fund (the "Transfer Agent") to the
following effect (or as the Fund may from time to
time prescribe):
"The undersigned seller (i) acknowledges that the
sale of the securities of Supremex Income Fund to
which this declaration relates is being made in
reliance on Rule 904 of Regulation S ("Regulation
S") under the United States Securities Act of
1933, as amended (the "Securities Act") and (ii)
certifies that: (A) it is not an affiliate of
Supremex Income Fund (as defined in Rule 405
under the Securities Act); (B) the offer
- 5 -
of the securities was not made to a person in the
United States and either (1) at the time the buy
order was originated, the buyer was outside the
United States, or the seller and any person
acting on its behalf reasonably believe that the
buyer was outside the United States, or (2) the
transaction was executed on or through the
facilities of the TSX Venture Exchange or the
Toronto Stock Exchange, and neither the seller
nor any person acting on its behalf knows that
the transaction has been prearranged with a buyer
in the United States; (C) neither the seller nor
any affiliate of the seller nor any person acting
on any of their behalf has engaged or will engage
in any "directed selling efforts" (as such term
is defined in Regulation S) in the United States
in connection with the offer and sale of the
securities; (D) the sale is bona fide and not for
the purpose of "washing off" the resale
restrictions imposed because the securities are
"restricted securities" (as that term is defined
in Rule 144(a)(3) under the Securities Act); (E)
the seller does not intend to replace the
securities sold in reliance on Rule 904 of
Regulation S, with fungible unrestricted
securities; and (F) the contemplated sale is not
a transaction, or part of a series of
transactions which, although in technical
compliance with Regulation S, is part of a plan
or scheme to evade the registration provisions of
the Securities Act."
provided, further, that, if any such Units are
-------- -------
being sold inside the United States in accordance
with Rule 144 under the Securities Act and in
compliance with applicable state securities laws,
the legend may be removed by delivery to the
transfer agent and the Fund of an opinion of
counsel reasonably satisfactory to the Fund, to
the effect that such legend is no longer required
under applicable requirements of the Securities
Act or state securities laws.
It consents to the Fund making a notation in its
records or giving instructions to any transfer
agent of the Units in order to implement the
restrictions on transfer set out and described in
this Memorandum.
It understands and acknowledges that the Fund is
not obligated to file and has no present
intention of filing with the United States
Securities and Exchange Commission or with any
state securities administrator any registration
statement in respect of resales of the Units in
the United States.
It understands and acknowledges that the Fund (i)
is not obligated to remain a foreign issuer (as
defined in Regulation S under the U.S. Securities
Act), (ii) may not, at the time the Units are
resold by it or at any other time, be a foreign
issuer, and (iii) may engage in one or more
transactions which could cause the Fund not to be
a foreign issuer.
It understands and acknowledges that it is making
the representations and warranties and agreements
contained herein with the intent that they may be
relied upon by the Fund and the Underwriters in
determining its eligibility or (if applicable)
the eligibility of others on whose behalf it is
contracting hereunder to purchase the Units."
- 6 -
6. Each Underwriter agrees that:
(a) It will deliver, through its U.S. affiliate, a copy of
each of the Preliminary U.S. Placement Memorandum and U.S.
Placement Memorandum (including the Amended Preliminary
Prospectus or Final Prospectus, as the case may be,
relating to the Units) for the U.S. offering to each
person in the United States purchasing Units from it;
(b) It shall cause its U.S. affiliate to agree, for the
benefit of the Fund, to the same provisions as are
contained in paragraphs 5 and 6; and
(c) At the Closing Time, it, together with its U.S. affiliate
selling Units in the United States, will provide a
certificate, substantially in the form of Exhibit I to
this Schedule, relating to the manner of the offer and
sale of the Units in the United States or to U.S. persons.
EXHIBIT I TO SCHEDULE A
UNDERWRITERS' CERTIFICATE
In connection with the private placement in the United States of the trust
units (the "Units") of Supremex Income Fund (the "Fund") pursuant to the
Underwriting Agreement dated o between, among others, the Fund and the
Underwriters named therein, in the United States, (the "Underwriting
Agreement"), each of the undersigned does hereby certify as follows:
(i) [U.S. AFFILIATE] is a duly registered broker or
dealer with the United States Securities and
Exchange Commission (the "SEC") and the National
Association of Securities Dealers, Inc. ("NASD")
and is in good standing with the NASD and the SEC
on the date hereof;
(ii) each offeree of the Units in the United States
was provided with a copy of the Preliminary U.S.
Placement Memorandum and each purchaser of the
Units in the United States, was provided with a
copy of the U.S. Placement Memorandum, including
the Final Prospectus dated o, for the offering of
the Units in the United States;
(iii) immediately prior to transmitting any such
private placement memorandum to any offeree or
purchaser, we had reasonable grounds to believe
and did believe that each offeree and purchaser
was a Qualified Institutional Buyer (as defined
in Rule 144A) and, on the date hereof, we
continue to believe that each such person is a
Qualified Institutional Buyer;
(iv) no form of general solicitation or general
advertising (as those terms are used in
Regulation D under the 0000 Xxx) was used by us,
including advertisements, articles, notices or
other communications published in any newspaper,
magazine or similar media or broadcast over radio
or television, or any seminar or meeting whose
attendees had been invited by general
solicitation or general advertising, in
connection with the offer or sale of the Units in
the United States or to U.S. persons; and
(v) the offering of the Units in the United States
has been conducted by us in accordance with the
terms of the Underwriting Agreement.
Capitalized terms used in this certificate have the meanings given to them
in the Underwriting Agreement unless otherwise defined herein.
IN WITNESS OF WHICH the parties have duly executed this Agreement.
[Remainder of page intentionally left blank]
- 2 -
NAME OF UNDERWRITER
By:
---------------------------------
Name: o
Title: o
By:
---------------------------------
Name: o
Title: o
NAME OF U.S. AFFILIATE
By:
---------------------------------
Name: o
Title: o
By:
---------------------------------
Name:o
Title:o
