EXECUTION FORM
EXCHANGE AND VOTING TRUST AGREEMENT
AMONG
ADVANCED COMMUNICATIONS GROUP, INC.
AND
ACG HOLDING COMPANY
AND
ACG EXCHANGE COMPANY
AND
1 + USA V ACQUISITION CORP.
AND
CERTAIN HOLDERS OF YPTEL LIMITED SHARES
AS LISTED ON SCHEDULE A
AND
YPTEL/ACG PLEDGE CORPORATION
AND
MONTREAL TRUST COMPANY OF CANADA, AS TRUSTEE
FEBRUARY 21, 2000
INDEX
ARTICLE 1 DEFINITIONS AND INTERPRETATION...................................... 2
1.1 DEFINITIONS............................................................ 2
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC........................... 7
1.3 NUMBER, GENDER, ETC.................................................... 7
1.4 DATE FOR ANY ACTION.................................................... 7
ARTICLE 2 PURPOSE OF AGREEMENT................................................ 7
ARTICLE 3 VOTING SHARE........................................................ 7
3.1 ISSUANCE AND OWNERSHIP OF THE VOTING SHARE............................. 7
3.2 LEGEND SHARE CERTIFICATES.............................................. 8
3.3 SAFE KEEPING OF CERTIFICATE............................................ 8
ARTICLE 4 EXERCISE OF VOTING RIGHTS........................................... 8
4.1 VOTING RIGHTS.......................................................... 8
4.2 VOTING RIGHTS (CONTINUED).............................................. 8
4.3 NUMBER OF VOTES........................................................ 9
4.4 MAILINGS TO SHAREHOLDERS............................................... 9
4.5 COPIES OF STOCKHOLDER INFORMATION..................................... 10
4.6 OTHER MATERIALS....................................................... 11
4.7 LIST OF PERSONS ENTITLED TO VOTE...................................... 11
4.8 ENTITLEMENT TO DIRECT VOTES........................................... 12
4.9 VOTING BY TRUSTEE, AND ATTENDANCE OF TRUSTEE REPRESENTATIVE, AT MEETING 12
4.10 DISTRIBUTION OF WRITTEN MATERIALS.................................... 13
4.11 TERMINATION OF VOTING RIGHTS......................................... 13
ARTICLE 5 EXCHANGE RIGHT, EXCHANGE PUT RIGHT AND AUTOMATIC EXCHANGE RIGHT.... 13
5.1 GRANT AND OWNERSHIP OF THE EXCHANGE RIGHT............................. 13
5.2 GRANT AND OWNERSHIP OF THE AUTOMATIC EXCHANGE RIGHT................... 14
5.3 LEGEND SHARE CERTIFICATES............................................. 14
5.4 GENERAL EXERCISE OF EXCHANGE PUT RIGHT AND EXCHANGE RIGHT............. 14
5.5 PURCHASE PRICE........................................................ 14
5.6 EXERCISE INSTRUCTIONS FOR EXCHANGE PUT RIGHT AND EXCHANGE RIGHT....... 15
5.7 DELIVERY OF EXCHANGEABLE SHARE CONSIDERATION; EFFECT OF EXERCISE...... 16
5.8 EXERCISE OF EXCHANGE RIGHT SUBSEQUENT TO RETRACTION................... 18
5.9 STAMP OR OTHER TRANSFER TAXES......................................... 18
5.10 NOTICE OF INSOLVENCY EVENT........................................... 19
5.11 QUALIFICATION OF PARENT COMMON STOCK................................. 19
5.12 PARENT COMMON STOCK.................................................. 20
5.13 AUTOMATIC EXCHANGE ON LIQUIDATION OF PARENT.......................... 20
5.14 WITHHOLDING RIGHTS................................................... 21
5.15 MEANING OF DELIVERY OF EXCHANGEABLE SHARE CONSIDERATION.............. 22
- 2 -
ARTICLE 6 CERTAIN RIGHTS AND OBLIGATIONS OF NEWCO I TO ACQUIRE
EXCHANGEABLE SHARES................................................ 22
6.1 NEWCO I LIQUIDATION CALL RIGHT........................................ 22
6.2 NEWCO I REDEMPTION CALL RIGHT......................................... 24
6.3 NEWCO I RETRACTION CALL RIGHT......................................... 25
ARTICLE 7 MISCELLANEOUS...................................................... 26
7.1 RESTRICTIONS ON ISSUANCE OF PARENT SPECIAL VOTING STOCK............... 26
7.2 TRANSFER AGENT........................................................ 26
7.3 RESTRICTIONS ON TRANSFER OF CLASS A SPECIAL SHARES.................... 27
7.4 NON-REGISTRATION OF EXCHANGEABLE SHARES............................... 28
7.5 OVERRIDING RIGHT AND OBLIGATION....................................... 28
7.6 NO AUDIT.............................................................. 28
ARTICLE 8 CONCERNING THE TRUSTEE............................................. 29
8.1 POWERS AND DUTIES OF THE TRUSTEE...................................... 29
8.2 NO CONFLICT OF INTEREST............................................... 29
8.3 DEALINGS WITH TRANSFER AGENTS, REGISTRARS, ETC........................ 30
8.4 BOOKS AND RECORDS..................................................... 30
8.5 INCOME TAX RETURNS AND REPORTS........................................ 30
8.6 INDEMNIFICATION PRIOR TO CERTAIN ACTIONS BY TRUSTEE................... 31
8.7 ACTIONS BY HOLDERS.................................................... 31
8.8 RELIANCE UPON DECLARATIONS............................................ 31
8.9 EVIDENCE AND AUTHORITY TO TRUSTEE..................................... 31
8.10 EXPERTS, ADVISERS AND AGENTS......................................... 32
8.11 INVESTMENT OF MONEYS HELD BY TRUSTEE................................. 33
8.12 TRUSTEE NOT REQUIRED TO GIVE SECURITY................................ 33
8.13 TRUSTEE NOT BOUND TO ACT ON REQUEST.................................. 33
8.14 AUTHORITY TO CARRY ON BUSINESS....................................... 33
8.15 CONFLICTING CLAIMS................................................... 34
8.16 MISCELLANEOUS TRUSTEE PROVISIONS..................................... 34
8.17 ACCEPTANCE OF TRUST.................................................. 35
ARTICLE 9 COMPENSATION....................................................... 35
ARTICLE 10 INDEMNIFICATION AND LIMITATION OF LIABILITY....................... 35
10.1 INDEMNIFICATION OF THE TRUSTEE....................................... 35
10.2 LIMITATION OF LIABILITY.............................................. 36
ARTICLE 11 CHANGE OF TRUSTEE................................................. 36
11.1 RESIGNATION.......................................................... 36
11.2 REMOVAL.............................................................. 37
11.3 SUCCESSOR TRUSTEE.................................................... 37
11.4 NOTICE OF SUCCESSOR TRUSTEE.......................................... 37
ARTICLE 12 PARENT SUCCESSORS................................................. 37
12.1 CERTAIN REQUIREMENTS IN RESPECT OF COMBINATION, ETC.................. 37
12.2 VESTING OF POWERS IN PARENT SUCCESSOR................................ 38
- 3 -
12.3 SUBSIDIARIES......................................................... 38
ARTICLE 13 AMENDMENTS AND SUPPLEMENTAL AGREEMENTS............................ 39
13.1 AMENDMENTS, MODIFICATIONS, ETC....................................... 39
13.2 MINISTERIAL AMENDMENTS............................................... 39
13.3 MEETING TO CONSIDER AMENDMENTS....................................... 39
13.4 CHANGES IN CAPITAL OF PARENT OR NEWCO II............................. 40
13.5 EXECUTION OF SUPPLEMENTAL AGREEMENTS................................. 40
ARTICLE 14 TERMINATION AND AUTOMATIC REDEMPTION.............................. 41
14.1 PROVISIONS FOR AUTOMATIC REDEMPTION.................................. 41
14.2 TERM................................................................. 41
14.3 SURVIVAL OF CERTAIN PROVISIONS....................................... 41
ARTICLE 15 GENERAL.......................................................... 41
15.1 SEVERABILITY......................................................... 41
15.2 ENUREMENT............................................................ 41
15.3 NOTICES TO PARTIES................................................... 42
15.4 NOTICE TO NEWCO II, NEWCO I, AND PARENT.............................. 45
15.5 NOTICE TO HOLDERS.................................................... 46
15.6 COUNTERPARTS......................................................... 46
15.7 CONSTRUCTION......................................................... 46
15.8 JURISDICTION......................................................... 46
15.9 ATTORNMENT........................................................... 46
15.10 EFFECTIVENESS OF AGREEMENT.......................................... 47
15.11 TIME OF THE ESSENCE................................................. 47
EXCHANGE AND VOTING TRUST AGREEMENT
THIS EXCHANGE AND VOTING TRUST AGREEMENT is entered into as of February
21, 2000, by and among Advanced Communications Group, Inc., a corporation
existing under laws of Delaware ("PARENT"), ACG Holding Company, a Nova
Scotia unlimited liability company and a wholly owned subsidiary of Parent
("NEWCO I"), ACG Exchange Company, a Nova Scotia unlimited liability company
and a subsidiary of Newco I ("NEWCO II"), I + USA V Acquisition Corp., a
Delaware corporation and a wholly owned subsidiary of Parent and a
shareholder of Newco II ("USA V"), certain holders of shares of the Company
(defined below) as set out in Schedule A hereto, YPtel/ACG Pledge
Corporation, an Ontario corporation, and Montreal Trust Company of Canada, a
trust company incorporated under the laws of Canada ("TRUSTEE").
WHEREAS, pursuant to an Agreement dated as of the 3rd day of June, 1999,
as amended and restated October 26, 1999 (as the same may be further amended
from time to time, the "YPTEL AGREEMENT"), by and among Parent, YPtel
Corporation, a corporation then incorporated under the laws of Canada,
continued under the laws of Nova Scotia as YPtel Limited, to be amalgamated
with a Nova Scotia unlimited liability company prior to the Closing Date (as
defined in the YPtel Agreement) thus becoming a Nova Scotia unlimited
liability company which will become a subsidiary of Newco II on the Closing
Date (THE "COMPANY"), the shareholders of the Company listed on Exhibit A
attached thereto, Cold Trust, Global Investment Trust, Freezer Trust, Storage
Trust, Directory Trust and Publisher Trust (collectively the "BARBADIAN
TRUSTS"), The J.L.R. Family Trust, The Paisley Family Trust, Xxxxxx Xxxxxx,
and Xxxxxxx X. XxXxxxxx (COLLECTIVELY, THE "ICL PRINCIPALS") and Imperial
Capital Limited, a corporation incorporated under the laws of Ontario
("ICL"), the parties agreed that on the Closing Date the parties hereto would
execute and deliver the within Exchange and Voting Trust Agreement;
WHEREAS, pursuant to the YPtel Agreement, the shareholders of the
Company who are parties hereto will exchange certain of the issued and
outstanding common shares of the Company owned by them for all the initially
issued and outstanding Class A Special Shares of Newco II;
WHEREAS, Appendix A to the Articles of Association of Newco II, as
amended, sets forth, INTER ALIA, the rights, privileges, restrictions and
conditions attaching to the Class A Special Shares of Newco II (as the same
may be amended from time to time, the "EXCHANGEABLE SHARE PROVISIONS");
WHEREAS, Parent is to provide voting rights in Parent to each holder
(other than Parent or any Subsidiary of Parent) from time to time of
Exchangeable Shares, such voting rights to be equivalent to the voting rights
per share of Parent Common Stock for which such Exchangeable Shares are
exchangeable;
- 2 -
WHEREAS, Parent, Newco I and Newco II are to grant to and in favor of
the holders (other than Parent or any Subsidiary of Parent) from time to time
of Exchangeable Shares certain rights, in the circumstances set forth herein,
to require Parent and/or Newco I and/or Newco II to purchase from each such
holder all or any part of the Exchangeable Shares held by the holder;
WHEREAS, the parties desire to make appropriate provision and to
establish a procedure whereby voting rights in Parent shall be exercisable by
holders (other than Parent or any Subsidiary of Parent) from time to time of
Exchangeable Shares by and through the Trustee, which will hold legal title
to one share of Class B Preferred Stock of Parent, par value US$0.0001 (the
"PARENT SPECIAL VOTING STOCK") to which voting rights attach for the benefit
of such holders; and
WHEREAS, shortly after this Agreement becomes effective, Newco II will
amalgamate (the "NEWCO II AMALGAMATION") with various subsidiaries of Newco
II (other than the Company), and all the holders of common stock or of Class
A Special Shares of Newco II immediately prior to the amalgamation will
become all the holders of similar common shares and Class A Special Shares of
the amalgamated entity, which entity will also be named ACG Exchange Company
and be a Nova Scotia unlimited liability company (the "AMALGAMATED NEWCO II"
or "NEWCO II"), so that all references to Newco II herein shall refer to the
Newco II then existing and all references to the Class A Special Shares shall
refer to the Class A Special Shares of the Newco II then existing; and
WHEREAS, these recitals and any statements of fact in this Agreement
are made by Parent, Newco I, Newco II, USA V and the Holders and not by the
Trustee.
NOW, THEREFORE, in consideration of the respective covenants and
agreements provided in this Agreement and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the parties agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS. In this Agreement, the following terms shall have the
following meanings:
"ACG CONTROL TRANSACTION" means the completion of a Proposed Sale as
provided in Section 2.8 of the Support Agreement.
"AGGREGATE EQUIVALENT VOTING AMOUNT" means, with respect to any matter,
proposition or question on which holders of Parent Common Stock are entitled
to vote, consent or otherwise act, the product of (a) the number of shares of
Parent Common Stock for which Exchangeable Shares then issued and outstanding
and held by Holders (as hereinafter defined) are exchangeable
- 3 -
multiplied by (b) the number of votes to which a holder of one share of
Parent Common Stock is entitled with respect to such matter, proposition or
question.
"AGREEMENT" means the within agreement, as the same may be amended from
time to time.
"AMALGAMATED NEWCO II" has the meaning provided in the recitals above.
"APPLICABLE LAWS" has the meaning provided in Section 5.11 hereof.
"ARTICLES OF ASSOCIATION" means the Articles of Association of Newco II
as amended from time to time.
"AUTOMATIC EXCHANGE RIGHT" means the benefit of the obligation of Parent
and Newco I to effect the automatic exchange of shares of Parent Common Stock
for Exchangeable Shares pursuant to Section 5.13 hereof.
"AUTOMATIC REDEMPTION DATE" has the meaning provided in the Exchangeable
Share Provisions.
"BOARD OF DIRECTORS" means the board of directors of Newco II.
"BUSINESS DAY" has the meaning provided in the Exchangeable Share
Provisions;
"CLASS A SPECIAL SHARES" means the Class A Special Shares of Newco II,
and effective upon the Newco II Amalgamation, means the Class A Special
Shares of the Amalgamated Newco II;
"CLEC OPERATIONS" has the meaning provided in the YPtel Agreement.
"CLOSING DATE" has the meaning provided in the YPtel Agreement.
"COMPANY" has the meaning provided in the recitals above.
"EXCHANGE AGENT LETTER" means initially the letter agreement between
Parent, Newco I, Newco II, USA V and Transfer Agent with respect to
appointment of Continental Stock Transfer and Trust Company as exchange agent
with respect to the Class A Special Shares and providing for the holding of
certificates for Class A Special Shares in safekeeping on behalf of the
Holders, and includes any subsequent agreement with a Transfer Agent
fulfilling similar functions.
"EXCHANGE AGENT LETTER CONDITIONS" has the meaning provided in Section
5.6.
"EXCHANGE PUT DATE" has the meaning set forth in Section 5.7 hereof.
- 4 -
"EXCHANGE PUT RIGHT" has the meaning provided in Section 8.1(a) of the
Exchangeable Share Provisions.
"EXCHANGE RIGHT" has the meaning provided in Section 5.1 hereof.
"EXCHANGEABLE SHARE CONSIDERATION" has the meaning provided in the
Exchangeable Share Provisions.
"EXCHANGEABLE SHARE PROVISIONS" has the meaning provided in the recitals
hereto, as such Appendix A may be amended from time to time.
"EXCHANGEABLE SHARES" means the Class A Special Shares.
"HOLDER EQUIVALENT VOTE AMOUNT" means, with respect to any matter,
proposition or question on which holders of Parent Common Stock are entitled
to vote, consent or otherwise act, the product of (a) the number of shares of
Parent Common Stock for which Exchangeable Shares then issued and outstanding
and held by a Holder are exchangeable, multiplied by (b) the number of votes
to which a holder of one share of Parent Common Stock is entitled with
respect to such matter, proposition or question.
"HOLDER VOTES" has the meaning provided in Section 4.3 hereof.
"HOLDERS" means the registered holders from time to time of Exchangeable
Shares, other than Exchangeable Shares beneficially owned by Parent or its
Subsidiaries.
"INSOLVENCY EVENT" means the institution by Newco II of any proceeding
to be adjudicated a bankrupt or insolvent or to be dissolved or wound-up, or
the consent of Newco II to the institution of bankruptcy, insolvency,
dissolution or winding-up proceedings against it, or the filing of a
petition, answer or consent seeking dissolution or winding-up under any
bankruptcy, insolvency or analogous laws, including without limitation the
Companies Creditors' Arrangement Act (Canada) and the Bankruptcy and
Insolvency Act (Canada), and the failure by Newco II to contest in good faith
any such proceedings commenced in respect of Newco II within 30 days of
becoming aware thereof, or the consent by Newco II to the filing of any such
petition or to the appointment of a receiver, or the making by Newco II of a
general assignment for the benefit of creditors, or the admission in writing
by Newco II of its inability to pay its debts generally as they become due,
or Newco II not being permitted, pursuant to liquidity or solvency
requirements of applicable law, to redeem any Retracted Shares pursuant to
Section 6.6 of the Exchangeable Share Provisions unless Newco I shall have
exercised its Retraction Call Right.
"LIQUIDATION CALL PURCHASE PRICE" has the meaning set forth in Section
6.1 hereof.
"LIQUIDATION CALL RIGHT" has the meaning provided in Section 6.1 hereof.
- 5 -
"LIQUIDATION EVENT" has the meaning provided in Subsection 5.13(b)
hereof.
"LIQUIDATION EVENT EFFECTIVE TIME" has the meaning provided in
Subsection 5.13(c) hereof.
"LIST" has the meaning provided in Section 4.7 hereof.
"MINIMUM NUMBER" means the lesser of (a) the number of Exchangeable
Shares which are exchangeable for 1,000 shares of Parent Common Stock or more
(b) all Exchangeable Shares then registered in the name of the applicable
Holder if exchangeable for less than 1,000 shares of Parent Common Stock.
"NEWCO I RETRACTION CALL NOTICE" has the meaning provided in Section 6.3
hereof.
"NEWCO II AMALGAMATION" has the meaning provided in the recitals above.
"OFFICER'S CERTIFICATE" means, with respect to Parent, a certificate
signed by the Chief Executive Officer or Chief Financial Officer of Parent
and with respect to Newco I, Newco II or USA V a certificate signed by the
President, Vice-President or Treasurer of Newco I or Newco II or USA V, as
applicable.
"PARENT COMMON STOCK" means a share of common stock of Parent, par value
US$0.0001.
"PARENT CONSENT" has the meaning provided in Section 4.3 hereof.
"PARENT MEETING" has the meaning provided in Section 4.3 hereof.
"PARENT SPECIAL VOTING STOCK" has the meaning provided in the recitals
hereto.
"PARENT SUCCESSOR" has the meaning provided in subsection 12.1(a) hereof.
"PERSON" includes an individual, body corporate, partnership, company,
unincorporated syndicate or organization, trust, trustee, executor,
administrator and other legal representative.
"PROPOSED SALE" has the meaning provided in Section 2.8 of the Support
Agreement.
"PURCHASE PRICE" has the meaning provided in Section 6.3 hereof.
- 6 -
"REDEMPTION CALL PURCHASE PRICE" has the meaning provided in Section 6.2
hereof.
"REDEMPTION CALL RIGHT" has the meaning provided in Section 6.2 hereof.
"REDEMPTION DATE" shall have the meaning provided in the Exchangeable
Share Provisions.
"RETRACTED SHARES" has the meaning provided in Section 6.1 of the
Exchangeable Share Provisions and Section 5.8 hereof.
"RETRACTION CALL RIGHT" has the meaning provided in Section 6.1 of the
Exchangeable Share Provisions and Section 6.3 hereof.
"RETRACTION DATE" shall have the meaning provided in Section 6.1 of the
Exchangeable Share Provisions.
"RETRACTION REQUEST" has the meaning provided in Section 6.1 of the
Exchangeable Share Provisions.
"S-3 EFFECTIVE DATE" has the meaning provided in Section 5.15 hereof.
"SUBSIDIARY" has the meaning provided in the Exchangeable Share
Provisions.
"SUPPORT AGREEMENT" means that certain Support Agreement made as of even
date hereof by and between Parent, Newco I, Newco II, USA V and the Company
shareholders party thereto, as such Support Agreement may be amended from
time to time.
"TRANSFER AGENT" means the duly appointed exchange agent for the time
being of the Class A Special Shares, and as applicable a duly appointed
transfer agent for the time being of the Class A Special Shares; the initial
Transfer Agent shall be Continental Stock Transfer and Trust Company, which
is exchange agent, branch registrar and co-transfer agent with respect to the
Class A Special Shares.
"TRANSFER AGENT OFFICE" means the office of the Transfer Agent that may
be specified from time to time by the Transfer Agent in connection with
presentation or surrender of certificates of Exchangeable Shares by holders
thereof and for other purposes.
"TRUST" means the trust created by this Agreement with respect to the
Trust Estate.
"TRUST ESTATE" means the Voting Share.
- 7 -
"TRUSTEE" means Montreal Trust Company of Canada and, subject to the
provisions of Article 11 hereof, includes any successor trustee or
permitted assigns.
"VOTING RIGHTS" means the voting rights attached to the Voting Share.
"VOTING SHARE" means the one share of Parent Special Voting Stock issued
by Parent to and deposited with the Trustee, which entitles the holder of
record to a number of votes at meetings of holders of Parent Common Stock
equal to the Aggregate Equivalent Voting Amount.
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC. The division of this
Agreement into articles, sections and paragraphs and the insertion of
headings are for convenience of reference only and shall not affect the
construction or interpretation of this Agreement. Unless otherwise indicated,
all references to an "Article" or "Section" followed by a number and/or a
letter refer to the specified Article or Section of this Agreement. The terms
"this Agreement", "hereof", "herein" and "hereunder" and similar expressions
refer to this Agreement and not to any particular Article, Section or other
portion hereof and include any agreement or instrument supplementary or
ancillary hereto.
1.3 NUMBER, GENDER, ETC. Words importing the singular number only
shall include the plural and vice versa. Words importing the use of any
gender shall include all genders.
1.4 DATE FOR ANY ACTION. If any date on which any action is required
to be taken under this Agreement is not a Business Day, such action shall be
required to be taken on the next succeeding Business Day.
ARTICLE 2
PURPOSE OF AGREEMENT
2.1 PURPOSE. The purpose of this Agreement is (i) to create the Trust
for the benefit of the Holders with respect to the Voting Share; and (ii) to
provide certain rights to the Holders of Exchangeable Shares, Newco I and
Parent, as herein provided.
ARTICLE 3
VOTING SHARE
3.1 ISSUANCE AND OWNERSHIP OF THE VOTING SHARE. Parent hereby issues
to and deposits with the Trustee, the Voting Share to be hereafter held of
record by the Trustee as trustee for and on behalf of, and for the use and
benefit of, the Holders and in accordance with the provisions of this
Agreement. Parent hereby acknowledges receipt from the Trustee as trustee for
and on behalf of the Holders of good and valuable consideration (and the
adequacy thereof) for the issuance of the Voting Share by Parent to the
Trustee. During the term of the Trust and subject to the terms and conditions
of this Agreement, the Trustee
- 8 -
shall possess and be vested with full legal ownership of the Voting Share and
shall be entitled to exercise the voting rights and all of the other rights
and powers of an owner with respect to the Voting Share, provided that the
Trustee shall:
(a) hold the Voting Share and the legal title thereto as trustee
solely for the use and benefit of the Holders in accordance with
the provisions of this Agreement; and
(b) except as specifically authorized by this Agreement, have no power
or authority to sell, transfer, vote or otherwise deal in or with
the Voting Share, and the Voting Share shall not be used or
disposed of by the Trustee for any purpose other than the purposes
for which this Trust is created pursuant to this Agreement.
3.2 LEGEND SHARE CERTIFICATES. Newco II will cause each certificate
representing Exchangeable Shares to bear an appropriate legend notifying the
Holders of their right to instruct the Trustee with respect to the exercise
of the Voting Rights with respect to the Exchangeable Shares held by the
Holders.
3.3 SAFE KEEPING OF CERTIFICATE. The certificate representing the
Voting Share shall at all times be held in safekeeping by the Trustee.
ARTICLE 4
EXERCISE OF VOTING RIGHTS
4.1 VOTING RIGHTS. The Trustee, as the holder of record of the Voting
Share, shall be entitled to all of the Voting Rights, including the right to
consent to or to vote in person or by proxy the Voting Share, on any matter,
question or proposition whatsoever that may properly come before the
stockholders of Parent at a Parent Meeting or in connection with a Parent
Consent. The Voting Rights shall be and remain vested in and exercised by the
Trustee. Subject to Section 8.15 hereof:
(a) the Trustee shall exercise the Voting Rights only on the basis of
instructions received pursuant to this Article 4 from Holders
entitled to instruct the Trustee as to the voting thereof at the
time at which a Parent Consent is sought or a Parent Meeting is
held; and
(b) to the extent that no instructions are received from a Holder with
respect to the Voting Rights to which such Holder is entitled, the
Trustee shall vote the Holder Votes of such Holder in the same
manner as the majority of other Holder Votes for which Trustee has
received instructions are voted by Trustee.
4.2 VOTING RIGHTS (CONTINUED). The holder of the Voting Share is
entitled to vote with the holders of Parent Common Stock as a single class in
accordance with the terms of the Parent Special Voting Stock. When the holder
- 9 -
of the Voting Share is entitled to vote as a separate class in accordance
with the terms of the Parent Special Voting Stock, the Holders may instruct
the Trustee as to the exercise of the votes attached to the Voting Share in
such class or series vote. The Trustee acknowledges that, in accordance with
the terms of the Parent Special Voting Stock, the holder of the Voting Share
and the holders of shares of Parent Common Stock shall vote or consent (or
withhold consent) as a single class in respect of each matter, question or
proposition to be voted on at a Parent Meeting or with respect to which
consent is sought in connection with a Parent Consent, it being further
acknowledged that, in certain circumstances, the holder of the Voting Share
shall, in addition, have a further vote as a separate class or series in
respect of any particular matter, question or proposition.
4.3 NUMBER OF VOTES. With respect to all meetings of stockholders of
Parent at which holders of shares of Parent Common Stock are entitled to vote
(a "PARENT MEETING") and with respect to all written consents sought by
Parent from its stockholders including the holders of shares of Parent Common
Stock (a "PARENT CONSENT"), each Holder shall be entitled to instruct the
Trustee to cast and exercise, in the manner instructed, a number of votes
equal to the Holder Equivalent Vote Amount with respect to the Exchangeable
Shares owned of record by such Holder on the record date established by
Parent or by applicable law for such Parent Meeting or Parent Consent, as the
case may be, (the "HOLDER VOTES") in respect of each matter, question or
proposition to be voted on at such Parent Meeting or with respect to which
consent is sought in connection with such Parent Consent.
4.4 MAILINGS TO SHAREHOLDERS. With respect to each Parent Meeting and
Parent Consent, the Trustee will mail or cause to be mailed (or otherwise
communicate in the same manner as Parent utilizes in communications to
holders of Parent Common Stock) to each of the Holders named in the List on
the same day as the initial mailing or notice (or other communication) with
respect thereto is commenced or given by Parent to its stockholders:
(a) a copy of such notice, together with any related materials to be
provided to stockholders of Parent;
(b) a statement that such Holder is entitled to instruct the Trustee
as to the exercise of the Holder Votes with respect to such Parent
Meeting or Parent Consent, as the case may be, or pursuant to
Section 4.8 hereof, to attend such Parent Meeting and to exercise
personally the Holder Votes thereat;
(c) a statement as to the manner in which such instructions may be
given to the Trustee, including an express indication that
instructions may be given to the Trustee to give:
(i) a proxy to such Holder or his designee to exercise
personally the Holder Votes; or
- 10 -
(ii) a proxy to a designated agent or other representative of the
management of Parent to exercise such Holder Votes;
(d) a statement that if no such instructions are received from the
Holder, the Holder Votes to which such Holder is entitled are to
be voted in the same manner as the majority of the other Holder
Votes for which Trustee has received instruction are voted by
Trustee;
(e) a form of direction whereby the Holder may so direct and instruct
the Trustee as contemplated herein; and
(f) a statement of the time and date by which such instructions must
be received by the Trustee in order to be binding upon it, which
in the case of a Parent Meeting shall not be earlier than the
close of business on the second Business Day prior to such
meeting, and the method for revoking or amending such instructions.
The materials referred to above are to be provided by Parent to the
Trustee, but to the extent feasible, draft forms of items (b) through (f)
shall be submitted to Trustee in advance for review and comment by the
Trustee.
For the purpose of determining Holder Votes to which a Holder is
entitled in respect of any such Parent Meeting or Parent Consent, the number
of Exchangeable Shares owned of record by the Holder shall be determined at
the close of business on the record date established by Parent or by
applicable law for purposes of determining stockholders entitled to vote at
such Parent Meeting or to give written consent in connection with such Parent
Consent. Parent will notify the Trustee of any decision of the board of
directors of Parent with respect to the calling of any such Parent Meeting or
the seeking of any such Parent Consent and shall provide all necessary
information and materials to the Trustee in each case promptly and in any
event in sufficient time to enable the Trustee to perform its obligations
contemplated by this Section 4.4.
4.5 COPIES OF STOCKHOLDER INFORMATION. Parent will deliver to the
Trustee copies of all proxy materials, (including notices of Parent Meetings,
but excluding proxies to vote shares of Parent Common Stock), information
statements, reports (including without limitation all interim and annual
financial statements) and other written communications that are to be
distributed from time to time to holders of Parent Common Stock in sufficient
quantities and in sufficient time so as to enable the Trustee to send those
materials to each Holder at or about the same time as such materials are sent
to holders of Parent Common Stock. The Trustee will mail or otherwise send to
each Holder, at the expense of Parent, copies of all such materials (and all
materials specifically directed to the Holders or to the Trustee for the
benefit of the Holders by Parent) received by the Trustee from Parent at or
about the same time as such materials are first sent to holders of Parent
Common Stock. The Trustee will also make available for inspection by any
Holder at the Trustee's principal trust office in the
- 11 -
City of Toronto all proxy materials, information statements, reports and
other written communications that are:
(a) received by the Trustee as the registered holder of the Parent
Special Voting Stock and made available by Parent generally to
holders of Parent Common Stock; or
(b) specifically directed to the Holders or to the Trustee for the
benefit of the Holders by Parent.
4.6 OTHER MATERIALS. As soon as practicable after receipt by Parent or
any stockholder of Parent (if such receipt is known by Parent) of any
material sent or given generally to the holders of Parent Common Stock by or
on behalf of a third party, including without limitation dissident proxy and
information circulars (and related information and material) and tender and
exchange offer circulars (and related information and material), Parent shall
obtain and deliver to the Trustee copies thereof in sufficient quantities so
as to enable the Trustee to forward such material (unless the same has been
provided directly to Holders by such third party) to each Holder as soon as
possible thereafter. As soon as practicable after receipt thereof, the
Trustee will mail or otherwise send to each Holder, at the expense of Parent,
copies of all such materials received by the Trustee from Parent. The Trustee
will also make copies of all such materials available for inspection by any
Holder at the Trustee's principal trust office in the City of Toronto.
4.7 LIST OF PERSONS ENTITLED TO VOTE. Newco II shall, (a) prior to
each annual and special Parent Meeting or the seeking of any Parent Consent
and (b) forthwith upon each request made at any time by the Trustee in
writing, prepare or cause to be prepared a list (a "LIST") of the names and
addresses of the Holders arranged in alphabetical order and showing the
number of Exchangeable Shares held of record by each such Holder, in each
case at the close of business on the date specified by the Trustee in such
request or, in the case of a List prepared in connection with a Parent
Meeting or a Parent Consent, at the close of business on the record date
established by Parent or pursuant to applicable law for determining the
holders of Parent Common Stock entitled to receive notice of and/or to vote
at such Parent Meeting or to give consent in connection with such Parent
Consent. Each such List shall be delivered to the Trustee promptly after
receipt by Newco II of such request or the record date for such meeting or
seeking of consent, as the case may be, and in any event within sufficient
time as to enable the Trustee to perform its obligations under this
Agreement. Parent agrees to give Newco II written notice (with a copy to the
Trustee) of the calling of any Parent Meeting or the seeking of any Parent
Consent, together with the record dates therefor, sufficiently prior to the
date of the calling of such meeting or seeking of such consent so as to
enable Newco II to perform its obligations under this Section 4.7. Newco II
shall cause the Transfer Agent to prepare and deliver the List as
contemplated hereunder and to deliver copies thereof to Newco I, Parent and
Trustee upon their request. Parent
- 12 -
agrees to provide a copy of the most current List prepared upon request of a
Holder of Exchangeable Shares from time to time.
4.8 ENTITLEMENT TO DIRECT VOTES. Any Holder named in a List prepared
in connection with any Parent Meeting or any Parent Consent will be entitled
(a) to instruct the Trustee in the manner described in Section 4.4 hereof
with respect to the exercise of the Holder Votes to which such Holder is
entitled or (b) to attend such meeting and personally to exercise thereat (or
to exercise with respect to any written consent), as the proxy of the
Trustee, the Holder Votes to which such Holder is entitled.
4.9 VOTING BY TRUSTEE, AND ATTENDANCE OF TRUSTEE REPRESENTATIVE, AT
MEETING.
(a) In connection with each Parent Meeting and Parent Consent, the
Trustee shall exercise, either in person or by proxy, in accordance with the
instructions received from a Holder pursuant to Section 4.4 hereof, the
Holder Votes as to which such Holder is entitled to direct the vote (or any
lesser number thereof as may be set forth in the instructions); provided,
however, that such written instructions are received by the Trustee from the
Holder prior to the time and date fixed by the Trustee for receipt of such
instructions in the notice given by the Trustee to the Holder pursuant to
Section 4.4 hereof.
(b) The Trustee shall cause a representative who is empowered by it to
sign and deliver, on behalf of the Trustee, proxies for Voting Rights to
attend each Parent Meeting. Upon submission by a Holder (or its designee) of
identification satisfactory to the Trustee's representative, and at the
Holder's request, such representative shall sign and deliver to such Holder
(or its designee) a proxy to exercise personally the Holder Votes as to which
such Holder is otherwise entitled hereunder to direct the vote, if such
Holder either:
(i) has not previously given the Trustee instructions pursuant
to Section 4.4 hereof in respect of such meeting, or
(ii) submits to the Trustee's representative written revocation
of any such previous instructions.
At such meeting, the Holder exercising such Holder Votes shall have the
same rights as the Trustee to speak at the meeting in respect of any matter,
question or proposition, to vote by way of ballot at the meeting in respect
of any matter, question or proposition, and to vote at such meeting by way of
a show of hands in respect of any matter, question or proposition. The
Trustee shall be reimbursed by Parent for any reasonable expenses incurred in
the course of attending or causing a representative to attend each Parent
Meeting.
4.10 DISTRIBUTION OF WRITTEN MATERIALS. Any written materials to be
distributed by the Trustee to the Holders pursuant to this Agreement shall be
sent by mail (or otherwise communicated in the same manner as Parent utilizes
in
- 13 -
communications to holders of Parent Common Stock, subject to the Trustee
being advised in writing of such method of communication and its ability to
provide such method) to each Holder at its address as shown on the books of
Newco II. Newco II (and Parent) shall provide or cause to be provided to the
Trustee for this purpose, on a timely basis and without charge or other
expense:
(a) a current List; and
(b) at the request of the Trustee, mailing labels to enable the
Trustee to carry out its duties under this Agreement.
4.11 TERMINATION OF VOTING RIGHTS. Except as otherwise provided herein
or in the Exchangeable Share Provisions, all of the rights of a Holder with
respect to the Holder Votes exercisable in respect of the Exchangeable Shares
held by such Holder, including the right to instruct the Trustee as to the
voting of or to vote personally such Holder Votes, shall be deemed to be
surrendered by the Holder and such Holder Votes and the Voting Rights
represented thereby shall cease immediately upon delivery of the Exchangeable
Share Consideration deliverable in exchange therefor by Parent, Newco I or
Newco II, upon the exercise by the Holder of the Exchange Put Right or the
Exchange Right or the occurrence of the automatic exchange of Exchangeable
Shares for shares of Parent Common Stock, as specified in Article 5 hereof,
or upon the retraction or redemption of Exchangeable Shares pursuant to
Article 6 or Article 7 of the Exchangeable Share Provisions, or upon the
effective date of the liquidation, dissolution or winding-up of Newco II or
any other distribution of the assets of Newco II among its shareholders for
the purpose of winding up its affairs pursuant to Article 5 of the
Exchangeable Share Provisions or upon the purchase of Exchangeable Shares
from the holder thereof by Newco I pursuant to the exercise by Newco I of the
Retraction Call Right, the Redemption Call Right or the Liquidation Call
Right.
ARTICLE 5
EXCHANGE RIGHT, EXCHANGE PUT RIGHT AND AUTOMATIC EXCHANGE RIGHT
5.1 GRANT AND OWNERSHIP OF THE EXCHANGE PUT RIGHT AND EXCHANGE RIGHT.
Parent and Newco I hereby jointly and severally grant to each Holder:
(a) the Exchange Put Right; and
(b) the right (the "EXCHANGE RIGHT") upon the occurrence and during
the continuance of an Insolvency Event, to require Newco I (and
upon default by Newco I, Parent) to purchase from such Holder all
or any part comprising at least the Minimum Number of the
Exchangeable Shares held by such Holder;
all in accordance with the provisions of this Agreement and the Exchangeable
Share Provisions, as the case may be. Each of Parent and Newco I hereby
- 14 -
acknowledges receipt from the Holders of good and valuable consideration (and
the adequacy thereof) for the grant of the Exchange Put Right and the
Exchange Right to the Holders. Subject to the terms and conditions of this
Agreement, the Holders shall be entitled to exercise all of the rights and
powers of an owner with respect to the Exchange Put Right and the Exchange
Right.
5.2 GRANT AND OWNERSHIP OF THE AUTOMATIC EXCHANGE RIGHT. Parent and
Newco I hereby jointly and severally grant to the Holders the Automatic
Exchange Right in accordance with the provisions of this Agreement. Each of
Parent and Newco I hereby acknowledges receipt from the Holders of good and
valuable consideration (and the adequacy thereof) for the grant of the
Automatic Exchange Right by Parent and Newco I to the Holders. Subject to the
terms and conditions of this Agreement, the Holders shall be entitled to
exercise all of the rights and powers of an owner with respect to the
Automatic Exchange Right.
5.3 LEGEND SHARE CERTIFICATES. Newco II will cause each certificate
representing Exchangeable Shares to bear an appropriate legend notifying the
Holders of:
(a) their right with respect to the exercise of the Exchange Put
Right and the Exchange Right in respect of the Exchangeable
Shares held by a Holder, and
(b) the Automatic Exchange Right.
5.4 GENERAL EXERCISE OF EXCHANGE PUT RIGHT, THE EXCHANGE RIGHT AND THE
AUTOMATIC EXCHANGE RIGHT. The Exchange Put Right, the Exchange Right and the
Automatic Exchange Right shall be and remain vested in the Holders.
5.5 PURCHASE PRICE. The purchase price payable by Parent or Newco I
for each Exchangeable Share to be purchased by Parent or Newco I (a) under
the Exchange Put Right, (b) under the Exchange Right or (c) under the
Automatic Exchange Right, shall be consideration equal to the Exchangeable
Share Consideration. The applicable Exchangeable Share Consideration for each
such Exchangeable Share so purchased may be satisfied by Parent issuing and
Parent or Newco I delivering or causing to be delivered to the relevant
Holder, the applicable Exchangeable Share Consideration (less any amounts
withheld pursuant to Section 5.14 hereof). A purchase pursuant to the
Exchange Put Right, the Exchange Right or the Automatic Exchange Right may be
made by either Parent or Newco I, as may be determined by Parent and Newco I
in their discretion, but unless a Holder is otherwise advised by Parent or
Newco I at any time, a Holder may assume the purchase will be made by Newco I
and Parent will cause the completion of such purchase by Newco I and delivery
of the Exchangeable Share Consideration. If Newco I fails to complete a
purchase as aforesaid or Parent is unable to cause Newco I to so complete,
Parent shall
- 15 -
deliver such Exchangeable Share Consideration to complete such purchase
within the time period required pursuant to Section 5.7 hereof.
5.6 EXERCISE INSTRUCTIONS FOR EXCHANGE PUT RIGHT AND EXCHANGE RIGHT.
Subject to the terms and conditions provided in Article 8 of the Exchangeable
Share Provisions with respect to the Exchange Put Right and subject to the
terms and conditions set forth herein with respect to the Exchange Put Right
and the Exchange Right, a Holder shall be entitled (a) to exercise the
Exchange Put Right at any time and (b) upon the occurrence and during the
continuance of an Insolvency Event, to exercise the Exchange Right, in either
case with respect to all or any part comprising at least the Minimum Number
of the Exchangeable Shares registered in the name of such Holder on the books
of Newco II. To cause the exercise of the Exchange Right or the Exchange Put
Right, the Holder shall present and surrender to Transfer Agent at the
Transfer Agent Office the certificates representing the Exchangeable Shares
which such Holder desires Parent or Newco I to purchase, duly endorsed in
blank (or as may be otherwise specified by the Transfer Agent), and
accompanied by such other documents and instruments as may be required to
effect a transfer of Exchangeable Shares under the Act and the Articles of
Association of Newco II and such other documents and instruments as are
required hereunder or as Transfer Agent may reasonably request together with:
(a) a duly completed form of notice of exercise of the Exchange Put
Right or Exchange Right, as applicable, stating:
(i) that the Holder thereby exercises the Exchange Right or
Exchange Put Right, as applicable, so as to require Parent
or Newco I to purchase from the Holder the number of
Exchangeable Shares specified therein, provided such number
shall be at least the Minimum Number,
(ii) for the Exchange Right, stating that an Insolvency Event has
occurred and is continuing and attaching appropriate
evidence that such has occurred,
(iii) that such Holder has good title to and owns all such
Exchangeable Shares to be acquired by Parent or Newco I, as
applicable, free and clear of all liens, claims,
encumbrances, security interests and adverse claims or
interests,
(iv) the names in which the certificates representing Parent
Common Stock issuable in connection with the exercise of the
Exchange Right are to be issued, and
(v) the names and addresses of the persons to whom the
Exchangeable Share Consideration should be delivered.
- 16 -
(b) payment (or evidence reasonably satisfactory to Parent of payment)
of the taxes (if any) payable as contemplated by Section 5.9 of this
Agreement or a statement by such Holder that no such taxes are payable.
So long as the certificates representing the Exchangeable Shares are
held for safekeeping in the possession of the Transfer Agent on behalf of a
Holder pursuant to the Exchange Agent Letter, and the Transfer Agent has
received any necessary instructions or authorizations from such Holder to
transfer the Class A Special Shares (the "EXCHANGE AGENT LETTER CONDITIONS"),
then if a Holder delivers to Transfer Agent a duly completed form of notice
of exercise of the Exchange Put Right or Exchange Right, as applicable, in
the form of Form 1 or Form 2 attached hereto, respectively, and provided an
Insolvency Event shall have occurred and be continuing in the case of the
exercise of the Exchange Right, no additional documents or instruments shall
be required to be submitted for the proper exercise of the Exchange Put Right
or Exchange Right, unless the Holder is specifically notified by the Transfer
Agent in good faith of an additional document or instrument necessary to
comply with applicable legal requirements.
Such notice shall be irrevocable unless revoked (as to exercise of the
Exchange Put Right) by the Holder pursuant to Section 5.7(c) below or unless
the applicable purchase is not completed in accordance herewith and shall
constitute the Holder's authorization to Newco I and Parent, as the case may
be, to effect the exchange on behalf of the Holder. The surrender by the
Holder of Exchangeable Shares hereunder shall constitute the representation,
warranty and covenant of the Holder that the Exchangeable Shares so purchased
are sold free and clear of any lien, encumbrance, security interest or
adverse claim or interest. If only a part of the Exchangeable Shares
represented by any certificate or certificates delivered to Transfer Agent
are to be purchased by Parent or Newco I under the Exchange Right or Exchange
Put Right, a new certificate for the balance of such Exchangeable Shares
shall be issued and promptly delivered to the Holder at the expense of Newco
II.
5.7 DELIVERY OF EXCHANGEABLE SHARE CONSIDERATION; EFFECT OF EXERCISE.
(a) The receipt by the Transfer Agent at the Transfer Agent Office
(which shall be deemed receipt by Parent and Newco I) of the certificates
duly endorsed for transfer representing the Exchangeable Shares which the
Holder desires Parent or Newco I to purchase under the Exchange Put Right or
the Exchange Right or the holding of such certificates by Transfer Agent as
referenced in Section 5.6(b) above, together with such other documents and
instruments of transfer, if any, and a duly completed form of notice of
exercise of the Exchange Put Right or the Exchange Right (and payment of
taxes, if any, payable as contemplated by Section 5.9 hereof) (the date of
such receipt in the case of the Exchange Put Right sometimes being referred
to as the "EXCHANGE PUT DATE", and in the case of the Exchange Right
sometimes being referred to as the "EXCHANGE NOTICE DATE"), shall constitute
exercise of the Exchange Put
- 17 -
Right or the Exchange Right, as applicable, by the Holder of such
Exchangeable Shares. Parent or Newco I, as applicable, shall within two (2)
Business Days after such receipt if the Exchange Agent Letter Conditions are
satisfied and otherwise within five (5) Business Days after such receipt,
make delivery of the Exchangeable Share Consideration to the Holder in
connection with the exercise of the Exchange Put Right or the Exchange Right
(less any amounts withheld pursuant to Section 5.14 hereof); provided,
however, that no such delivery shall be made unless and until the Holder
requesting the same shall have paid (or provided evidence satisfactory to the
Transfer Agent of the payment of) the taxes (if any) payable as contemplated
by Section 5.9 of this Agreement. Parent will cause Newco I to make delivery
of the Exchangeable Share Consideration in accordance with this Section
5.7(a) or will deliver it itself.
(b) Unless a Holder exercises its right to revoke pursuant to Section
5.7(c) with respect to the Exchange Put Right, immediately upon the notice of
the exercise of the Exchange Put Right or the Exchange Right as provided in
this Section 5.7(a), the closing of the transaction of purchase and sale
contemplated by the Exchange Put Right or the Exchange Right shall be deemed
to have occurred and Parent and/or Newco I, as applicable, shall be required
to take all action necessary to permit it to occur, including delivery of the
relevant Exchangeable Share Consideration, no later than the close of
business on the second Business Day or the fifth Business Day, as applicable,
following the Exchange Put Date or Exchange Notice Date. The Holder of such
Exchangeable Shares shall be deemed to have transferred to Parent or Newco I,
as applicable, all of its right, title and interest in and to such
Exchangeable Shares, shall cease to be a holder of such Exchangeable Shares
and shall not be entitled to exercise any of the rights of a holder or Holder
in respect thereof when such Exchangeable Share Consideration is delivered by
Parent or Newco I to the Holder, and until such time the rights of the Holder
shall remain unaffected. Concurrently with such Holder ceasing to be a holder
of Exchangeable Shares, the Holder shall be considered and deemed for all
purposes to be the holder of the shares of Parent Common Stock delivered to
it pursuant to the Exchange Put Right or the Exchange Right. For greater
certainty, until the Exchangeable Share Consideration is delivered to the
Holder (or as the Holder may direct), the Holder shall be deemed to still be
a holder of the Exchangeable Shares tendered for sale for purposes of voting
rights with respect thereto under this Agreement.
(c) A Holder may, by notice in writing given by the Holder to the
Transfer Agent before the close of business on the first Business Day
following the Exchange Put Date, provided no such notice by Holder shall be
effective if given to the Transfer Agent after the Exchangeable Share
Consideration has been delivered to such Holder, withdraw such Holder's
notice of exercise of the Exchange Put Right in which event such exercise of
the Exchange Put Right shall be null and void, and for greater certainty, the
offer constituted by the notice exercising the Exchange Put Right to sell the
applicable Exchangeable Shares shall be deemed to be revoked. A Holder
revoking its notice of exercise of Exchange Put Right shall be obligated to
reimburse Parent or Newco I for any
- 18 -
actual costs incurred (including any charges of the Transfer Agent) in
connection with such Holder's exercise of the Exchange Put Right prior to
Transfer Agent's receipt of notice of the applicable withdrawal.
5.8 EXERCISE OF EXCHANGE RIGHT SUBSEQUENT TO RETRACTION. In the event
that a Holder has exercised its right under Article 6 of the Exchangeable
Share Provisions to require Newco II to redeem all or any part comprising at
least the Minimum Number of the Exchangeable Shares held by the Holder (the
"RETRACTED SHARES") and is notified by Newco II pursuant to Section 6.6 of
the Exchangeable Share Provisions that Newco II will not be permitted as a
result of liquidity or solvency requirements of applicable law to redeem all
such Retracted Shares, subject to receipt by the Holders of written notice to
that effect from Newco II and that the Holder has not revoked the Retraction
Request delivered by the Holder to Newco II pursuant to Section 6.7 of the
Exchangeable Share Provisions, the Retraction Request will constitute and
will be deemed to constitute notice from the Holder to Parent and Newco I
with respect to the exercise of the Exchange Right with respect to those
Retracted Shares which Newco II is unable to redeem. In any such event, Newco
II hereby agrees immediately to notify the Holder of such prohibition against
Newco II's redeeming all of the Retracted Shares and immediately to forward
or cause to be forwarded to the Holder all relevant materials delivered by
the Holder to Newco II (including without limitation a copy of the Retraction
Request delivered pursuant to Section 6.1 of the Exchangeable Share
Provisions) in connection with such proposed redemption of the Retracted
Shares, and Newco I and/or Parent will thereupon purchase the Retracted
Shares which Newco II is not permitted to redeem.
5.9 STAMP OR OTHER TRANSFER TAXES. Upon any sale of Exchangeable
Shares to Parent or Newco I pursuant to the Exchange Put Right or the
Exchange Right or any sale of Exchangeable Shares to Parent or Newco I
pursuant to the Automatic Exchange Right, the share certificate or
certificates representing Parent Common Stock to be delivered in connection
with the payment of the total purchase price therefor shall be issued in the
name of the Holder of the Exchangeable Shares so sold or in such names as
such Holder may otherwise direct the Transfer Agent in writing, without
charge to the holder of the Exchangeable Shares so sold, provided, however,
that such Holder:
(a) shall pay (and Parent and Newco I shall not be required to pay)
any documentary, stamp, transfer or other taxes that may be
payable in respect of any transfer involved in the issuance or
delivery of such shares to a person other than such Holder, or
(b) shall have established to the reasonable satisfaction of Parent or
Newco I, as applicable, that such taxes, if any, have been paid or
Holder shall have provided a statement that no such taxes are
payable.
- 19 -
Such determination of taxes payable (or not) shall be made within the period
during which the Exchangeable Share Consideration is required to be delivered.
5.10 NOTICE OF INSOLVENCY EVENT. As soon as practicable following the
occurrence of an Insolvency Event or any event which with the giving of
notice or the passage of time or both would be an Insolvency Event, Newco II
shall give written notice thereof to the Holders. As soon as practicable
after receiving notice from Newco II of the occurrence of an Insolvency
Event, Newco II will mail to each Holder at the expense of Newco II (or
Parent if necessary) a notice of such Insolvency Event, which notice shall
contain a brief statement of the right of the Holders with respect to the
Exchange Right.
5.11 QUALIFICATION OF PARENT COMMON STOCK. Parent covenants that if any
shares of Parent Common Stock to be issued and delivered pursuant to the
Exchange Put Right, the Exchange Right, the Automatic Exchange Right or
otherwise pursuant to this Agreement or under the Exchangeable Share
Provisions require registration or qualification with or approval of or the
filing of any document including any prospectus or similar document, the
taking of any proceeding with or the obtaining of any order, ruling or
consent from any governmental or regulatory authority under any Canadian or
United States federal, provincial or state law or regulation or pursuant to
the rules and regulations of any regulatory authority, or the fulfillment of
any other legal requirement (collectively, the "APPLICABLE LAWS") before such
shares may be issued or transferred and delivered by Parent, Newco I or Newco
II to the initial holder thereof or in order that such shares of Parent
Common Stock may be freely traded thereafter, Parent will in good faith
expeditiously take all such actions and do all such things as are necessary
to register, qualify or obtain required approvals for the resale by such
holders of such shares of Parent Common Stock. Parent will in good faith take
all actions and do all things as are necessary under Applicable Laws at the
relevant time to cause the shares of Parent Common Stock to be issued and
delivered pursuant to the Exchange Put Right, the Exchange Right, the
Automatic Exchange Right or otherwise pursuant to this Agreement or under the
Exchangeable Share Provisions and to be freely tradeable thereafter, provided
that the first trade of Parent Common Stock is required to be executed
through the facilities of a stock exchange or market outside of Canada (such
as the New York Stock Exchange). Parent and Newco II, as the case may be,
will in good faith expeditiously take all such actions and do all such things
as are necessary to cause all shares of Parent Common Stock to be delivered
pursuant to the Exchange Put Right, the Exchange Right, the Automatic
Exchange Right or otherwise pursuant to this Agreement or under the
Exchangeable Share Provisions to be listed, quoted or posted for trading on
all stock exchanges and quotation systems on which outstanding shares of
Parent Common Stock are listed, quoted or posted for trading at such time.
Parent covenants that on or before the Closing Date in the YPTel Agreement,
Parent shall have registered, qualified or obtained required approvals for
the resale by the holders of Parent Common Stock with respect to the Parent
Common Stock hereafter required to be issued and delivered in connection with
exchanges
- 20 -
pursuant to the Exchange Put Right, the Exchange Right, the Automatic
Exchange Right or the Exchangeable Share Provisions.
5.12 PARENT COMMON STOCK. Parent hereby represents, warrants and
covenants that the Parent Common Stock issuable and deliverable as described
herein will be duly authorized and validly issued as fully paid and
non-assessable.
5.13 AUTOMATIC EXCHANGE ON LIQUIDATION OF PARENT.
(a) Parent will give the Holders written notice of each of the
following events at the time set forth below:
(i) in the event of any determination by the board of directors
of Parent to institute voluntary liquidation, dissolution or
winding-up proceedings with respect to Parent or to effect
any other distribution of assets of Parent among its
stockholders for the purpose of winding up its affairs at
the same time as notice is sent by Parent to holders of its
shares, which shall in any event be at least 30 days prior
to the proposed effective date of such liquidation,
dissolution, winding-up or other distribution; and
(ii) as soon as practicable following the earlier of: receipt by
Parent of notice of, or Parent's otherwise becoming aware
of, any threatened or instituted claim, suit, petition or
other proceedings with respect to the involuntary
liquidation, dissolution or winding-up of Parent or to
effect any other distribution of assets of Parent among its
stockholders for the purpose of winding up its affairs, in
each case where Parent has failed to contest in good faith
any such proceeding commenced in respect of Parent within 30
days of becoming aware thereof.
(b) Immediately following or together with the notice by Parent to
Holders of any event (a "LIQUIDATION EVENT") contemplated by Section
5.13(a)(i) or 5.13(a)(ii) above, Parent shall provide Holders with details
concerning the automatic exchange of Exchangeable Shares for shares of Parent
Common Stock provided for in Section 5.13(c) hereof (the "AUTOMATIC EXCHANGE
RIGHT").
(c) In order that the Holders will be able to participate on a pro
rata basis with the holders of Parent Common Stock in the distribution of
assets of Parent in connection with a Liquidation Event, immediately prior to
the effective time (the "LIQUIDATION EVENT EFFECTIVE TIME") of a Liquidation
Event, all of the then outstanding Exchangeable Shares shall be automatically
exchanged for shares of Parent Common Stock without any action of Holders
being required.
- 21 -
To effect such automatic exchange, Parent shall then be deemed to have
purchased each Exchangeable Share outstanding immediately prior to the
Liquidation Event Effective Time and held by Holders, and each Holder shall
then be deemed to have sold the Exchangeable Shares held by it at such time,
for a purchase price per share equal to the Exchangeable Share Consideration.
(d) The closing of the transaction of purchase and sale contemplated
by Section 5.13(c) above shall be deemed to have occurred immediately prior
to the Liquidation Event Effective Time, and each Holder of Exchangeable
Shares shall be deemed to have transferred to Parent all of the Holder's
right, title and interest in and to such Exchangeable Shares and shall cease
to be a holder of such Exchangeable Shares, and Parent shall deliver to the
Holder the Exchangeable Share Consideration deliverable upon the automatic
exchange of Exchangeable Shares (less any amounts withheld pursuant to
Section 5.14 hereof). Concurrently with such Holder's ceasing to be a holder
of Exchangeable Shares, the Holder shall be considered and deemed for all
purposes to be the holder of the shares of Parent Common Stock delivered to
it pursuant to the automatic exchange of Exchangeable Shares for Parent
Common Stock, and the certificates held by the Holder previously representing
the Exchangeable Shares exchanged by the Holder with Parent pursuant to such
automatic exchange shall thereafter be deemed to represent the shares of
Parent Common Stock delivered to the Holder pursuant to such automatic
exchange. Upon the request of a Holder and the surrender by the Holder of
Exchangeable Share certificates deemed to represent shares of Parent Common
Stock, duly endorsed in blank and accompanied by such instruments of transfer
as Parent may reasonably require, Parent shall deliver or cause to be
delivered to the Holder, at the expense of Parent, certificates representing
the shares of Parent Common Stock of which the Holder is the holder.
Notwithstanding the foregoing, until each Holder is actually entered on the
register of holders of Parent Common Stock, such Holder shall be deemed to
still be a holder of the transferred Exchangeable Shares for purposes of all
voting rights with respect thereto under this Agreement.
5.14 WITHHOLDING RIGHTS. Parent or Newco I, as applicable, shall be
entitled to deduct and withhold from any consideration otherwise payable
under this Agreement to any holder of Exchangeable Shares or Parent Common
Stock such amounts as Parent or Newco I, as applicable, is required to deduct
and withhold with respect to such payment under the Income Tax Act (Canada),
the United States Internal Revenue Code of 1986 or any provision of
provincial, state, local or foreign tax law, in each case as amended or
succeeded. Such determination of the requirement to withhold shall be made
within the period during which the Exchangeable Share Consideration is
required to be delivered. To the extent that amounts are so withheld, such
withheld amounts shall be treated for all purposes as having been paid to the
holder of the shares in respect of which such deduction and withholding was
made, provided that such withheld amounts are actually remitted to the
appropriate taxing authority and details are provided to such holder. To the
extent that the amount so required to be
- 22 -
deducted or withheld from any payment to a Holder exceeds the cash portion of
the consideration otherwise payable to the Holder, Parent or Newco I, as
applicable, is hereby authorized to sell or otherwise dispose only of such
portion of the consideration as is necessary to provide sufficient funds to
Parent or Newco I, as applicable, to enable it to comply with such
withholding requirement, and Parent or Newco I, as applicable, shall notify
the Holder thereof and remit to such Holder any unapplied balance of the net
proceeds of such sale, if any.
5.15 MEANING OF DELIVERY OF EXCHANGEABLE SHARE CONSIDERATION. Subject
to the following sentence, until a Form S-3 registration statement is filed
by Parent with the United States Securities and Exchange Commission and such
filing becomes effective with respect to the Parent Common Stock to be
provided as Exchangeable Share Consideration (such date, the "S-3 EFFECTIVE
DATE"), delivery of the Exchangeable Share Consideration shall mean when the
Exchangeable Share Consideration is sent by reputable overnight courier, such
as Federal Express, the costs of which shall be paid by Parent, Newco I or
Newco II as applicable, in each case sent in accordance with instructions
provided by the Holder to the Transfer Agent, and absent effective
instructions, to the address of the Holder as appearing on the records of the
Transfer Agent or in accordance with the usual procedure of the Transfer
Agent with respect to exchanges of such Class A Special Shares. If a delivery
is to be made to complete a sale trade of the Parent Common Stock through the
New York Stock Exchange and the person so designated is a broker with a DTC
number, the Parent Common Stock to be so sold shall be transmitted by
electronic means to the designated broker if so instructed by the Holder.
After the S-3 Effective Date occurs, delivery of the Exchangeable Share
Consideration to a Holder shall mean delivery by electronic means unless the
arrangements for electronic means have been revoked or shall otherwise fail,
in which event delivery shall mean when the Exchangeable Share Consideration
is sent in the manner described in the preceding sentence.
ARTICLE 6
CERTAIN RIGHTS AND OBLIGATIONS OF NEWCO I
TO ACQUIRE EXCHANGEABLE SHARES
6.1 NEWCO I LIQUIDATION CALL RIGHT.
(a) Newco I shall have the overriding right (the "LIQUIDATION CALL
RIGHT"), in the event of and notwithstanding the proposed liquidation,
dissolution or winding-up of Newco II as referred to in Article 5 of the
Exchangeable Share Provisions, to purchase from all but not less than all of
the Holders of Exchangeable Shares on the Liquidation Date (as defined in
Section 5.1 of the Exchangeable Share Provisions) all but not less than all
of the Exchangeable Shares held by such Holders on payment by Newco I to each
holder of the Exchangeable Share Consideration (the "LIQUIDATION CALL
PURCHASE PRICE"). In the event of the exercise of the Liquidation Call Right
by Newco I, each Holder shall be obligated to sell all the Exchangeable
Shares held by the Holder to
- 23 -
Newco I on the Liquidation Date upon transfer and payment by Newco I to the
Holder of the Liquidation Call Purchase Price.
(b) To exercise the Liquidation Call Right, Newco I must notify the
Transfer Agent in writing, as agent for the holders of Exchangeable Shares,
of Newco I's intention to exercise such right at least ten (10) Business Days
before the Liquidation Date. Newco I shall also notify the Transfer Agent
accordingly if it does not intend to exercise the Liquidation Call Right.
Newco I or Newco II shall cause the Transfer Agent to notify the Holders of
Exchangeable Shares as to whether or not Newco I has exercised the
Liquidation Call Right forthwith after the expiry of the date by which the
same may be exercised by Newco I. If Newco I exercises the Liquidation Call
Right, on the Liquidation Date Newco I will purchase and the Holders will
sell all of the Exchangeable Shares then outstanding for the Exchangeable
Share Consideration.
(c) For purposes of completing the purchase of the Exchangeable Shares
pursuant to the Liquidation Call Right, Newco I shall deposit with the
Transfer Agent, on or before the Liquidation Date, the Exchangeable Share
Consideration representing the total Liquidation Call Purchase Price.
Provided that such Exchangeable Share Consideration has been so deposited
with the Transfer Agent, on and after the Liquidation Date the right of each
Holder of Exchangeable Shares will be limited to receiving such Holder's
proportionate part of the total Liquidation Call Purchase Price payable by
Newco I without interest upon presentation and surrender by the Holder of
certificates representing the Exchangeable Shares held by such Holder and the
Holder shall on and after the Liquidation Date be considered and deemed for
all purposes to be the holder of Parent Common Stock. Upon surrender to the
Transfer Agent at the Transfer Agent Office of a certificate or certificates
representing Exchangeable Shares, together with such other documents and
instruments as may reasonably be required to effect a transfer of
Exchangeable Shares or as the Transfer Agent may reasonably require or
alternatively if the Exchange Agent Letter Conditions are satisfied in
connection therewith, the Holder of such surrendered certificate or
certificates shall be entitled to receive in exchange therefor, and Newco I
(or the Transfer Agent on behalf of Newco I) shall deliver to such Holder,
the Exchangeable Share Consideration to which the Holder is entitled. If
Newco I does not exercise the Liquidation Call Right in the manner described
above, on the Liquidation Date the Holders of the Exchangeable Shares subject
to applicable law will be entitled to receive in exchange therefor the
Liquidation Consideration otherwise payable in connection with the
liquidation, dissolution or winding-up of Newco II pursuant to Article 5 of
the Exchangeable Share Provisions. Notwithstanding the foregoing, until such
Exchangeable Share Consideration is delivered to the Holder or the Transfer
Agent for such Holder, the Holder shall be deemed to still be a Holder of
Exchangeable Shares for purposes of all voting rights with respect thereto
under this Agreement.
(d) Notwithstanding anything to the contrary, Newco I and Parent
acknowledge and agree that prior to the Redemption Date or the Automatic
- 24 -
Redemption Date, no voluntary liquidation, dissolution or winding up of Newco
II shall be effected without the approval of the Holders of the Exchangeable
Shares given in accordance with Article 10 of the Exchangeable Share
Provisions.
6.2 NEWCO I REDEMPTION CALL RIGHT
(a) Newco I shall have the overriding right (the "REDEMPTION CALL
RIGHT") in the case of and notwithstanding the proposed redemption or
automatic redemption of the Exchangeable Shares by Newco II pursuant to
Article 7 of the Exchangeable Share Provisions, to purchase from all but not
less than all of the Holders of Exchangeable Shares on the Automatic
Redemption Date or the Redemption Date, as applicable, all but not less than
all of the Exchangeable Shares held by each such Holder on payment by Newco I
to each Holder of the Exchangeable Share Consideration (the "REDEMPTION CALL
PURCHASE PRICE"). In the event of the exercise of the Redemption Call Right
by Newco I, each Holder shall be obligated to sell all the Exchangeable
Shares held by such Holder to Newco I on the Automatic Redemption Date or
Redemption Date, as applicable, upon transfer and payment by Newco I to the
Holder of the Redemption Call Purchase Price.
(b) To exercise the Redemption Call Right, Newco I must notify the
Transfer Agent in writing, as agent for the Holders of Exchangeable Shares,
of Newco I's intention to exercise such right not later than five Business
Days after the date by which Newco II is required to give notice of the
Automatic Redemption Date or Redemption Date, or possible redemption, as
applicable. If Newco I exercises the Redemption Call Right, then on the
Automatic Redemption Date or the Redemption Date, as applicable, Newco I will
purchase and the Holders will sell all of the Exchangeable Shares then
outstanding for the Exchangeable Share Consideration. In the case of any
notice given in connection with a possible Automatic Redemption Date, such
notice by Newco I will be given contingently and will be withdrawn if the
contingency does not occur. Notwithstanding the foregoing, the failure of
Newco II to give timely notice of a Redemption Date or the failure of Newco I
to give timely notice of its exercise of the Redemption Call Right shall not
prevent the exercise by Newco I of the Redemption Call Right, but the holders
of Exchangeable Shares shall nevertheless be entitled to notice of redemption
pursuant to Section 7.2 of the Exchangeable Share provisions at least 30 days
before the Redemption Date, and if such is delayed, the Redemption Date shall
be similarly delayed.
(c) For the purposes of completing the purchase of the Exchangeable
Shares pursuant to the Redemption Call Right, Newco I shall deposit with the
Transfer Agent, on or before the Automatic Redemption Date or the Redemption
Date, as applicable, the Exchangeable Share Consideration representing the
total Redemption Call Purchase Price. Provided that such Exchangeable Share
Consideration has been so deposited with the Transfer Agent, on and after the
Automatic Redemption Date or the Redemption Date, as applicable, the rights
of each Holder of Exchangeable Shares will be limited to receiving such
Holder's
- 25 -
proportionate part of the total Redemption Call Purchase Price payable by
Newco I without interest upon presentation and surrender by the Holder of
certificates representing the Exchangeable Shares held by such Holder, and
the Holder shall on and after the Automatic Redemption Date or the Redemption
Date, as applicable, be considered and deemed for all purposes to be the
holder of the Parent Common Stock delivered to such Holder. Upon surrender to
the Transfer Agent at the Transfer Agent Office of a certificate or
certificates representing Exchangeable Shares, together with such other
documents and instruments as may be required to effect a transfer of
Exchangeable Shares or as the Transfer Agent may reasonably require, or
alternatively if the Exchange Agent Letter Conditions are satisfied in
connection therewith, the Holder of such surrendered certificate or
certificates shall be entitled to receive in exchange therefor, and Newco I
(or the Transfer Agent on behalf of Newco I) shall deliver to such Holder, or
as such Holder shall direct, the Exchangeable Share Consideration to which
the Holder is entitled. If Newco I does not exercise the Redemption Call
Right in the manner described above on the Automatic Redemption Date or the
Redemption Date, as applicable, the Holders of the Exchangeable Shares will
be entitled to receive in exchange therefor the Exchangeable Share
Consideration otherwise payable by Newco II in connection with the redemption
of the Exchangeable Shares pursuant to Article 7 of the Exchangeable Share
Provisions. Notwithstanding the foregoing, until such Exchangeable Share
Consideration is delivered to the Holder or the Transfer Agent for such
Holder, the Holder shall be deemed to still be a Holder of Exchangeable
Shares for purposes of all voting rights with respect thereto under this
Agreement.
6.3 NEWCO I RETRACTION CALL RIGHT.
(a) Newco I shall have the overriding right (the "RETRACTION CALL
RIGHT"), in the event of a Retraction Request by a Holder under Article 6 of
the Exchangeable Share Provisions and in lieu of a redemption by Newco II of
the Retracted Shares under Article 6 of the Exchangeable Share Provisions, to
purchase all but not less than all of the Retracted Shares directly from the
Holder of Exchangeable Shares, and such Retraction Request shall be deemed to
be a revocable offer by the Holder to sell the Retracted Shares in accordance
with the terms and conditions of this Section 6.3
(b) To exercise the Retraction Call Right, Newco I shall notify Newco
II (directly or through the Transfer Agent) of its determination to do so
(the "NEWCO I RETRACTION CALL NOTICE") within one Business Day of the date
Newco II (directly or through the Transfer Agent) received the Retraction
Request and related documents in proper form. If Newco I does not so notify
Newco II within one Business Day, Newco II (directly or through the Transfer
Agent) will notify the Holder as soon as possible thereafter that Newco I
will not exercise the Retraction Call Right. If such notice is given to the
Holder by Newco II, Newco I shall be deemed not to have exercised its
Retraction Call Right. If Newco I delivers the Newco I Retraction Call Notice
within such one Business Day, and
- 26 -
provided that the Retraction Request is not revoked by the Holder in the
manner specified in Section 6.7 of the Exchangeable Share Provisions, the
Retraction Request shall thereupon be considered only to be an offer by the
Holder to sell the Retracted Shares to Newco I in accordance with the
Retraction Call Right. In such event, Newco II shall not redeem the Retracted
Shares and Newco I shall purchase from such Holder and such Holder shall sell
to Newco I on the Retraction Date, the Retracted Shares for a purchase price
(the "PURCHASE PRICE") equal to the Exchangeable Share Consideration.
(c) For the purposes of completing a purchase pursuant to the
Retraction Call Right, Newco I shall deposit with the Transfer Agent, on or
before the Retraction Date the Exchangeable Share Consideration representing
the total Purchase Price. Provided that such Exchangeable Share Consideration
has been so deposited with the Transfer Agent, the closing of the purchase
and sale of the Retracted Shares pursuant to the Retraction Call Right shall
be deemed to have occurred as at the close of business on the Retraction Date
and, for greater certainty, no redemption by Newco II of such Retracted
Shares shall take place on the Retraction Date. Newco I shall deliver or
cause the Transfer Agent to deliver to such Holder, at the address of the
Holder recorded in the securities register of Newco II for the Exchangeable
Shares or to such Person and address as specified in the Holder's Retraction
Request or pursuant to other written instructions of Holder to the Transfer
Agent or by holding for pick up by the Holder at the Transfer Agent Office,
the Exchangeable Share Consideration representing the total Purchase Price
(less any tax permitted or required to be deducted or withheld therefrom by
Newco I), and such delivery of such Exchangeable Share Consideration to the
Transfer Agent shall be deemed to be payment of and shall satisfy and
discharge all liability for the total Purchase Price except as to any cheque
included therein which is not paid on due presentation.
(d) A Holder may withdraw its Retraction Request and revoke its offer
to sell pursuant to the provisions of Section 6.7 of the Exchangeable Share
Provisions. The rights of a Holder with respect to Retracted Shares from and
after the Retraction Date shall be limited as provided in Section 6.6 of the
Exchangeable Share Provisions.
ARTICLE 7
MISCELLANEOUS
7.1 RESTRICTIONS ON ISSUANCE OF PARENT SPECIAL VOTING STOCK. During
the term of this Agreement, Parent will not, without the consent of the
Holders at the relevant time of the Exchangeable Shares given in accordance
with Article 10 of the Exchangeable Share Provisions, issue any shares of
Parent Special Voting Stock in addition to the Voting Share.
7.2 TRANSFER AGENT. Parent, Newco I and Newco II covenant that there
shall at all times be a Transfer Agent with authority to carry out the
functions of the Transfer Agent as contemplated by the Exchangeable Share
- 27 -
Provisions and this Agreement. The Transfer Agent shall either be (i) a
recognized transfer agent or trust company, or (ii) a law firm with an office
in Halifax, Nova Scotia. All costs of such Transfer Agent and all costs
incurred in connection with the Exchangeable Shares shall be borne by Newco
II, except as Newco I or Parent may otherwise agree or except as expressly
provided herein to the contrary, but if Newco II fails to pay or is unable to
pay such costs when due, Newco I shall pay such costs when due, and if Newco
I fails to pay or is unable to pay such costs when due, Parent shall pay such
costs when due.
7.3 RESTRICTIONS ON TRANSFER OF CLASS A SPECIAL SHARES.
(a) In addition to any other restrictions imposed by applicable laws
on a Holder's ability to transfer any Class A Special Shares, each Holder of
any Class A Special Shares agrees that such Holder will not sell, transfer or
otherwise dispose of any of the Class A Special Shares received by such
Holder pursuant to the YPtel Agreement or otherwise, except:
(i) pursuant to the laws of descent and distribution;
(ii) as a distribution from a trust to the beneficiaries of such
trust; or
(iii) as a transfer from a Holder to a Person not at arms length
from the transferor or to a trust for the benefit of Persons
not at arms length from the transferor,
provided that the distributee of such shares by descent and distribution or
from a trust shall remain subject to these transfer restrictions and that in
the case of a transfer to a Person not at arms length from the transferor,
such Person shall execute and deliver an agreement acknowledging that such
Person is bound by and subject to these transfer restrictions. For purposes
of this Section 7.3, a pledge of Exchangeable Shares by a Holder to a
financial institution as collateral security for loans arranged by such
Holder or for margining purposes shall not constitute a sale, transfer, or
other disposition of such shares so long as the financial institution agrees
to be bound to the restrictions imposed by this Section, nor shall any
release or transfer back to the Holder by such financial institution nor any
release or transfer by a Holder which is a pledgee back to the pledgor of the
Exchangeable Shares constitute a sale, transfer or other disposition of such
shares. Any distributee or transferee shall as condition precedent to having
the share transfer registered to such Person and becoming a Holder, execute
and deliver an agreement acknowledging that such Person joins in this
Agreement as a Holder and such Person is bound by and subject to all the
rights and obligations of a Holder under this Agreement, including without
limitation the transfer restrictions imposed by this Section.
(b) The restrictions in Section 7.3(a) shall not apply to any sale,
transfer or other disposition of Class A Special Shares to Newco I, Parent or
- 28 -
Newco II, including, without limitation, shall not apply to any sale,
transfer or disposition of Class A Special Shares in connection with the
exercise by a Holder of Class A Special Shares of any retraction, exchange or
redemption right provided under this Agreement or under the Exchangeable
Share Provisions.
(c) Except as provided in this Section 7.3 or with respect to
restrictions imposed by applicable laws on a Holder's ability to transfer any
Class A Special Shares, the sales, transfers, pledges or other dispositions
of Class A Special Shares permitted by this Section 7.3 shall not be subject
to any requirement of consent on the part of Parent, Newco II, Newco I, USA
V, their boards of directors or anyone under their direct or indirect control
notwithstanding anything to the contrary in any Articles of Association.
(d) At the option of the ICL Principals who are directly or indirectly
Holders of Class A Special Shares, such Holders may satisfy their
indemnification obligations under Section 9.5(c) of the YPTel Agreement by
transferring to Parent or as Parent may direct (to Newco I) Class A Special
Shares valued pursuant to said Section 9.5(c).
7.4 NON-REGISTRATION OF EXCHANGEABLE SHARES. The Holders of Class A
Special Shares acknowledge and agree with Newco II and Parent that it is not
presently contemplated that the Class A Special Shares will be registered
with the U.S. Securities and Exchange Commission or with any governmental
authorities under state blue sky laws or the Canadian and provincial
securities laws and the rules and regulations thereunder, and neither Parent
nor Newco I or Newco II have any contractual obligation to cause any such
shares to be so registered, provided such registration is not required to
permit the exchanges contemplated by Article 5 above or to allow the
Exchangeable Shares to be transferred as contemplated by Section 7.3 hereof.
7.5 OVERRIDING RIGHT AND OBLIGATION. If Newco I exercises the
Liquidation Call Right, Redemption Call Right or Retraction Call Right and
for any reason does not complete the applicable purchase of Exchangeable
Shares and deliver the applicable Exchangeable Share Consideration, Parent
shall promptly complete the applicable purchase of Exchangeable Shares and
deliver the applicable Exchangeable Share Consideration. Nothing contained
herein shall limit the right of a Holder to exercise the Exchange Put Right
directly with Parent if Newco I or Newco II does not carry out its respective
obligations under the Exchangeable Share Provisions or this Agreement to
complete a redemption, retraction, liquidation or purchase of Exchangeable
Shares in accordance with the terms and provisions hereof or of the
Exchangeable Share Provisions.
7.6 NO AUDIT. Parent, Newco I, Newco II and the Holders of
Exchangeable Shares agree and consent that the financial statements of Newco
I and Newco II shall not be required to be audited.
- 29 -
ARTICLE 8
CONCERNING THE TRUSTEE
8.1 POWERS AND DUTIES OF THE TRUSTEE. The rights, powers and
authorities of the Trustee under this Agreement, in its capacity as trustee
of the Trust, shall include:
(a) receipt and deposit of the Voting Share from Parent as trustee for
and on behalf of the Holders in accordance with the provisions of
this Agreement;
(b) granting proxies and distributing materials to Holders as provided
in this Agreement;
(c) voting the Holder Votes in accordance with the provisions of this
Agreement;
(d) holding title to the Trust Estate;
(e) taking action at the direction of a Holder or Holders to enforce
the obligations of Parent with respect to the Voting Share under this
Agreement; and
(f) taking such other actions and doing such other things as are
specifically provided with respect to the Trustee in this Agreement.
In the exercise of such rights, powers and authorities the Trustee shall
have (and is granted) such incidental and additional rights, powers and
authority not in conflict with any of the provisions of this Agreement as the
Trustee, acting in good faith and in the reasonable exercise of its
discretion, may deem necessary, appropriate or desirable to effect the
purpose of the Trust. Any exercise of such discretionary rights, powers and
authorities by the Trustee shall be final, conclusive and binding upon all
persons. The Trustee in exercising its rights, powers, duties and authorities
hereunder shall act honestly and in good faith with a view to the best
interests of the Holders and shall exercise the care, diligence and skill
that a reasonably prudent trustee would exercise in comparable circumstances.
8.2 NO CONFLICT OF INTEREST. The Trustee represents to Parent and the
Holders that at the date of execution and delivery of this Agreement there
exists no material conflict of interest in the role of the Trustee as a
fiduciary hereunder and the role of the Trustee in any other capacity. The
Trustee shall within 60 days after it becomes aware that such a material
conflict of interest exists, either eliminate such material conflict of
interest or resign in the manner and with the effect specified in Article 11
hereof. If, notwithstanding the foregoing provisions of this Section 8.2, the
Trustee has such a material conflict of interest, the validity and
enforceability of this Agreement shall not be affected in any manner
whatsoever by reason only of the existence of such material conflict of
- 30 -
interest. If the Trustee contravenes the foregoing provisions of this Section
8.2, any interested party may apply to the Superior Court of Justice
(Ontario) for an order that the Trustee be replaced as trustee hereunder. An
appointment of the Trustee as Transfer Agent for Newco II or transfer agent
for Newco I shall not be deemed to constitute a material conflict of interest
hereunder.
8.3 DEALINGS WITH TRANSFER AGENTS, REGISTRARS, ETC. Parent, Newco II
and the Holders irrevocably authorize the Trustee, from time to time, to:
(a) consult, communicate and otherwise deal with the respective
registrars and transfer agents, and with any subsequent registrar
or transfer agent, of the Exchangeable Shares and the Parent
Common Stock; and
(b) requisition, from time to time, from any such registrar or
transfer agent any information readily available from the records
maintained by it which the Trustee may reasonably require for the
discharge of its duties and responsibilities under this Agreement.
Parent and Newco II irrevocably authorize their respective registrars and
transfer agents to comply with any such requests.
8.4 BOOKS AND RECORDS. The Trustee shall keep available for inspection
by Parent and the Holders at the Trustee's principal trust office in Xxxxxxx,
Xxxxxxx, correct and complete books and records relating to the Trustee's
actions under this Agreement, including without limitation, all information
relating to mailings and instructions to and from Holders and all
transactions pursuant to the Voting Rights. On or before March 31, 2001, and
on or before March 31 in every year thereafter, so long as the Voting Share
is on deposit with the Trustee, the Trustee shall transmit to Parent and the
Holders a brief report, dated as of the preceding December 31, with respect
to:
(a) property comprising the Trust Estate as of that date; and
(b) all other actions taken by the Trustee in the performance of its
duties under this Agreement which it had not previously reported.
8.5 INCOME TAX RETURNS AND REPORTS. The Trustee shall to the extent
necessary, and if so advised by Parent or Newco II in writing, prepare and
file on behalf of the Trust appropriate United States and Canadian income tax
returns and any other returns or reports relating to the Parent Special
Voting Stock or the Trust Estate as may be required by applicable law or
pursuant to the rules and regulations of any securities exchange or other
trading system through which the Parent Common Stock are traded. The Trustee
may retain such experts as it may consider necessary in preparing such
returns. If requested by the Trustee, Parent shall retain such expert for
purposes of providing such advice and assistance.
- 31 -
8.6 INDEMNIFICATION PRIOR TO CERTAIN ACTIONS BY TRUSTEE. The Trustee
shall exercise any or all of the rights, duties, powers or authorities vested
in it by this Agreement at the request, order or direction of any Holder upon
such Holder's furnishing to the Trustee reasonable funding, security and
indemnity against the costs, expenses and liabilities which may be incurred
by the Trustee therein or thereby; provided that no Holder shall be obligated
to furnish to the Trustee any such funding, security or indemnity in
connection with the exercise by the Trustee of any of its rights, duties,
powers and authorities with respect to the Voting Share pursuant to Article 4
hereof, subject to Section 8.15 hereof or its obligations under this
Agreement. None of the provisions contained in this Agreement shall require
the Trustee to expend or risk its own funds or otherwise incur financial
liability in the exercise of any of its rights, powers, duties or authorities
unless funded, given security and indemnified as aforesaid.
8.7 ACTIONS BY HOLDERS. With respect to Articles 3, 4, 8, 9, 10, and
11 and Sections 2.1(i)and 7.1 hereof, no Holder shall have the right to
institute any action, suit or proceeding or to exercise any other remedy
authorized by this Agreement for the purpose of enforcing any of its rights
or for the execution of any trust or power hereunder unless the Holder has
requested the Trustee to take or institute such action, suit or proceeding
and furnished the Trustee with the funding, security and indemnity referred
to in Section 8.6 hereof and the Trustee shall have failed to act within a
reasonable time thereafter. In such case, but not otherwise, the Holder shall
be entitled to take proceedings in any court of competent jurisdiction such
as the Trustee might have taken; it being understood and intended that no one
or more Holders shall have any right in any manner whatsoever to affect,
disturb or prejudice the rights hereby created by any such action, or to
enforce any right hereunder or under the Voting Rights, except subject to the
conditions and in the manner herein provided, and that all powers and trusts
hereunder shall be exercised and all proceedings at law shall be instituted,
had and maintained by the Trustee, except only as herein provided, and in any
event for the equal benefit of all Holders. All costs so incurred by the
Holders in enforcing their rights hereunder shall be paid by the Parent if
the Holders are generally successful in such controversy.
8.8 RELIANCE UPON DECLARATIONS. The Trustee shall not be considered to
be in contravention of any of its rights, powers, duties and authorities
hereunder if, when required, it acts and relies in good faith upon lists,
mailing labels, notices, statutory declarations, certificates, opinions,
reports or other papers or documents furnished pursuant to the provisions
hereof or required by the Trustee to be furnished to it in the exercise of
its rights, powers, duties and authorities hereunder, and such lists, mailing
labels, notices, statutory declarations, certificates, opinions, reports or
other papers or documents comply with the provisions of Section 8.9 hereof,
if applicable, and with any other applicable provisions of this Agreement.
8.9 EVIDENCE AND AUTHORITY TO TRUSTEE. Parent shall furnish to the
Trustee evidence of compliance with the conditions provided for in this
- 32 -
Agreement relating to any action or step required or permitted to be taken by
it or the Trustee under this Agreement or as a result of any obligation
imposed under this Agreement, including, without limitation, in respect of
the Voting Right and the taking of any other action to be taken by the
Trustee at the request of or on the application of Parent or any Holder
forthwith if and when:
(a) such evidence is required by any other section of this Agreement
to be furnished to the Trustee in accordance with the terms of this
Section 8.9; or
(b) the Trustee, in the exercise of its rights, powers, duties and
authorities as Trustee under this Agreement, gives Parent written
notice requiring it to furnish such evidence in relation to any
particular action or obligation specified in such notice.
Such evidence may consist of a report or opinion of any solicitor or
other expert or any other person whose qualifications give authority to a
statement made by such person, provided that if such report or opinion is
furnished by a director, officer or employee of Parent, it shall be in the
form of an Officer's Certificate or a statutory declaration.
Each statutory declaration, Officer's Certificate, opinion or report
furnished to the Trustee as evidence of compliance with a condition provided
for in this Agreement shall include a statement by the person giving the
evidence:
(a) declaring that such person has read and understands the provisions
of this Agreement relating to the condition in question;
(b) describing the nature and scope of the examination or
investigation upon which such person based the statutory
declaration, Officer's Certificate, opinion or report; and
(c) declaring that such person has made such examination or
investigation as such person believes is necessary to enable such
person to make the statements or give the opinions contained or
expressed therein.
8.10 EXPERTS, ADVISERS AND AGENTS. The Trustee may:
(a) in relation to these presents act and rely on the opinion or
advice of or information obtained from or prepared by any
solicitor or other expert, whether retained by the Trustee or by
Parent or otherwise, and may employ such assistants as may be
necessary to the proper determination and discharge of its powers
and duties and determination of its rights hereunder and may pay
proper and reasonable compensation for all such legal and other
advice or assistance as aforesaid; and
- 33 -
(b) employ such agents and other assistants as it may reasonably
require for the proper determination and discharge of its powers
and duties hereunder, and may pay reasonable remuneration for all
services performed for it (and shall be entitled to receive
reasonable remuneration for all services performed by it) in the
discharge of the trusts hereof and compensation for all
disbursements, costs and expenses made or incurred by it in the
determination and discharge of its duties hereunder and in the
management of the Trust.
8.11 INVESTMENT OF MONEYS HELD BY TRUSTEE. Unless otherwise provided in
this Agreement, any moneys held by or on behalf of the Trustee which under
the terms of this Agreement may or ought to be invested or which may be on
deposit with the Trustee or which may be in the hands of the Trustee, may be
invested and reinvested in the name or under the control of the Trustee in
securities in which, under the laws of the Province of Ontario, trustees are
authorized to invest trust moneys; provided that such securities are stated
to mature within two years after their purchase by the Trustee, and the
Trustee shall so invest such moneys on the written direction of Parent.
Pending the investment of any moneys as hereinbefore provided, such moneys
may be deposited in the name of the Trustee in any chartered bank in Canada
or, with the consent of Parent, in the deposit department of the Trustee or
any other trust company authorized to accept deposits under the laws of
Canada or any province thereof at the rate of interest then current on
similar deposits.
8.12 TRUSTEE NOT REQUIRED TO GIVE SECURITY. The Trustee shall not be
required to give any bond or security in respect of the execution of the
trusts, rights, duties, powers and authorities of this Agreement or otherwise
in respect of the premises.
8.13 TRUSTEE NOT BOUND TO ACT ON REQUEST. Except as otherwise
specifically provided in this Agreement, the Trustee shall not be bound to
act in accordance with any direction or request of Parent or of the directors
thereof until a duly authenticated copy of the instrument or resolution
containing such direction or request shall have been delivered to the
Trustee, and the Trustee shall be empowered to act and rely upon any such
copy purporting to be authenticated and believed by the Trustee to be genuine.
8.14 AUTHORITY TO CARRY ON BUSINESS. The Trustee represents to Parent
and the Holders that at the date of execution and delivery by it of this
Agreement it is authorized to carry on the business of a trust company in the
Province of Ontario but if, notwithstanding the provisions of this Section
8.14, it ceases to be so authorized to carry on business, the validity and
enforceability of this Agreement shall not be affected in any manner
whatsoever by reason only of such event; provided, however, the Trustee shall
within 60 days after ceasing to be authorized to carry on the business of a
trust company in the Province of
- 34 -
Ontario, either become so authorized or resign in the manner and with the
effect specified in Article 11 hereof.
8.15 CONFLICTING CLAIMS. If conflicting claims or demands are made or
asserted with respect to the Parent Special Voting Stock or the Voting
Rights, the Trustee shall be entitled, at its sole discretion, to refuse to
recognize or to comply with any such claim or demand. In so refusing, the
Trustee may elect not to exercise any Voting Rights subject to such
conflicting claims or demands and, in so doing, the Trustee shall not be or
become liable to any person on account of such election or its failure or
refusal to comply with any such conflicting claims or demands. The Trustee
shall be entitled to continue to refrain from acting and to refuse to act
until:
(a) the rights of all adverse claimants with respect to the Voting
Rights subject to such conflicting claims or demands or with
respect to the Parent Special Voting Stock have been adjudicated
by a final judgment of a court of competent jurisdiction; or
(b) all differences with respect to the Voting Rights subject to such
conflicting claims or demands or with respect to the Parent
Special Voting Stock have been conclusively settled by a valid
written agreement binding on all such adverse claimants, and the
Trustee shall have been furnished with an executed copy of such
agreement.
If the Trustee elects to recognize any claim or comply with any demand
made by any such adverse claimant, it may in its discretion require such
claimant to furnish such surety bond or other security satisfactory to the
Trustee as it shall deem appropriate fully to indemnity it as between all
conflicting claims or demands.
8.16 MISCELLANEOUS TRUSTEE PROVISIONS.
(a) The Trustee shall incur no liability with respect to the delivery
or non-delivery of any materials described in Article 4, whether delivered by
hand, mail or any other means;
(b) The Trustee in its personal or any other capacity, may buy, lend
upon and deal in securities of Parent and generally may contract and enter
into financial transactions with Parent without being liable to account for
any profit made thereby;
(c) The Trustee shall not be bound to give any notice or do or take
any act, action or proceeding by virtue of the powers conferred on it hereby
unless and until it shall be specifically required to do so under the terms
hereof; nor shall the Trustee be required to take any notice of, or to take
any act, action or proceeding as a result of, any default or breach of any
provisions hereunder unless and until notified in writing of such default or
breach, which notice shall
- 35 -
distinctly specify the default or breach desired to be brought to the
attention of the Trustee and in the absence of such notice the Trustee may
for all purposes of this Agreement conclusively assume that no default or
breach has been made in the observance or performance of any of the
representations, warranties, covenants, agreements or conditions contained
herein; and
(d) The Trustee shall not be obligated to disburse any funds beyond
those which have been deposited with it and which remain in the Trust at the
time of any requirement that the Trustee disburse such funds.
(e) The Trustee shall not be responsible or liable in any manner
whatsoever for the sufficiency, correctness, genuineness, transferability,
validity or sufficiency of title of any securities deposited with it.
8.17 ACCEPTANCE OF TRUST. The Trustee hereby accepts the Trust created
and provided for by and in this Agreement and agrees to perform the same upon
the terms and conditions herein set forth and to hold all rights, privileges
and benefits conferred hereby and by law in trust for the various persons who
shall from time to time be Holders, subject to all the terms and conditions
herein set forth.
ARTICLE 9
COMPENSATION
9.1 Parent and Newco II agree to pay to the Trustee reasonable
compensation for all of the services rendered by it under this Agreement and
will reimburse the Trustee for all reasonable expenses (including taxes other
than taxes based on the net income of the Trustee) and disbursements,
including the fees and expenses of experts, advisers and agents retained
pursuant to Section 8.10 and including the cost and expense of any suit or
litigation of any character and any proceedings before any governmental
agency, reasonably incurred by the Trustee in connection with its rights and
duties under this Agreement; provided that Parent and Newco II shall have no
obligation to reimburse the Trustee for any expenses or disbursements paid,
incurred or suffered by the Trustee in any suit or litigation in which the
Trustee is determined to have acted fraudulently or in bad faith or with
negligence, recklessness or willful misconduct.
ARTICLE 10
INDEMNIFICATION AND LIMITATION OF LIABILITY
10.1 INDEMNIFICATION OF THE TRUSTEE. Parent, Newco I and Newco II agree
to indemnify and hold harmless the Trustee and each of its directors,
officers and agents appointed and acting in accordance with this Agreement
(collectively, the "INDEMNIFIED PARTIES") against all claims, losses,
damages, costs, penalties, fines and reasonable expenses (including
reasonable expenses of the Trustee's legal counsel) which, without fraud,
negligence, recklessness, willful misconduct or bad faith on the part of such
Indemnified Party, may be paid,
- 36 -
incurred or suffered by the Indemnified Party by reason of or as a result of
the Trustee's acceptance or administration of the Trust, its compliance with
its duties set forth in this Agreement, or any written or oral instructions
delivered to the Trustee by Parent pursuant hereto. In no case shall Parent,
Newco I or Newco II be liable under this indemnity for any claim against any
of the Indemnified Parties unless Parent, Newco I and Newco II shall be
notified by the Trustee of the written assertion of a claim or of any action
commenced against the Indemnified Parties, promptly after any of the
Indemnified Parties shall have received any such written assertion of a claim
or shall have been served with a summons or other first legal process giving
information as to the nature and basis of the claim. Subject to clause (ii)
below, Parent, Newco I and Newco II shall be entitled to participate at their
own expense in the defense and, if Parent, Newco I or Newco II so elects at
any time after receipt of such notice, it may assume the defense of any suit
brought to enforce any such claim. The Trustee shall have the right to employ
separate counsel in any such suit and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of the Trustee
unless: (i) the employment of such counsel has been authorized by Parent,
Newco I or Newco II; or (ii) the named parties to any such suit include both
the Trustee and Parent, Newco I or Newco II and the Trustee shall have been
advised by counsel acceptable to Parent, Newco I or Newco II that there may
be one or more legal defenses available to the Trustee that are different
from or in addition to those available to Parent, Newco I or Newco II and
that, in the judgement of such counsel, would present a conflict of interest
were a joint representation to be undertaken (in which case Parent, Newco I
and Newco II shall not have the right to assume the defense of such suit on
behalf of the Trustee, but shall be liable to pay the reasonable fees and
expenses of counsel for the Trustee); or (iii) Parent, Newco I and/or Newco
II shall not have retained legal counsel on behalf of the Trustee within a
reasonable amount of time after the Trustee has given them notice of a
written assertion of a claim or action against any indemnified party. Such
indemnification shall survive the resignation and removal of the Trustee and
termination of the Agreement.
10.2 LIMITATION OF LIABILITY. The Trustee shall not be held liable for
any loss which may occur by reason of depreciation of the value of any part
of the Trust Estate or any loss incurred on any investment of funds pursuant
to this Agreement, except to the extent that such loss is attributable to the
fraud, negligence, recklessness, willful misconduct or bad faith on the part
of the Trustee.
ARTICLE 11
CHANGE OF TRUSTEE
11.1 RESIGNATION. The Trustee, or any trustee hereafter appointed, may
at any time resign by giving written notice of such resignation to Parent
specifying the date on which it desires to resign, provided that such notice
shall never be given less than 60 days before such desired resignation date
unless Parent otherwise agrees and provided further that such resignation
shall not take
- 37 -
effect until the date of the appointment of a successor trustee and the
acceptance of such appointment by the successor trustee. Upon receiving such
notice of resignation, Parent shall promptly appoint a successor trustee by
written instrument in duplicate, one copy of which shall be delivered to the
resigning trustee and one copy to the successor trustee. Failing acceptance
by a successor trustee, a successor trustee may be appointed by an order of
the Superior Court of Justice (Ontario) upon application of one or more of
the parties hereto.
11.2 REMOVAL. The Trustee, or any trustee hereafter appointed, may be
removed with or without cause, at any time on not less than 30 days' prior
notice by written instrument executed by Parent, in duplicate, one copy of
which shall be delivered to the trustee so removed and one copy to the
successor trustee, provided that, in connection with such removal, provision
is made for a replacement trustee similar to that contemplated in Section
11.1.
11.3 SUCCESSOR TRUSTEE. Any successor trustee appointed as provided
under this Agreement shall execute, acknowledge and deliver to Parent and to
its predecessor trustee an instrument accepting such appointment. Thereupon
the resignation or removal of the predecessor trustee shall become effective
and such successor trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, duties and obligations of
its predecessor under this Agreement, with like effect as if originally named
as trustee in this Agreement. However, on the written request of Parent or of
the successor trustee, the trustee ceasing to act shall, upon payment of any
amounts then due it pursuant to the provisions of this Agreement, execute and
deliver an instrument transferring to such successor trustee all the rights
and powers of the trustee so ceasing to act. Upon the request of any such
successor trustee, Parent, and such predecessor trustee shall execute any and
all instruments in writing for more fully and certainly vesting in and
confirming to such successor trustee all such rights and powers.
11.4 NOTICE OF SUCCESSOR TRUSTEE. Upon acceptance of appointment by a
successor trustee as provided herein, Parent shall cause to be mailed notice
of the succession of such trustee hereunder to each Holder specified in a
List. If Parent shall fail to cause such notice to be mailed within 10 days
after acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be mailed at the expense of Parent.
ARTICLE 12
PARENT SUCCESSORS
12.1 CERTAIN REQUIREMENTS IN RESPECT OF COMBINATION, ETC. Except as
otherwise permitted pursuant to Section 2.8 of the Support Agreement, Parent
shall not enter into any transaction (whether by way of reconstruction,
reorganization, consolidation, merger, transfer, sale, lease or otherwise)
whereby all or substantially all of its undertaking, property and assets
would become the
- 38 -
property of any other Person or, in the case of a merger, of the continuing
corporation resulting therefrom, but may do so if:
(a) such other Person or continuing corporation (the "PARENT
SUCCESSOR"), by operation of law, becomes, without more, bound by
the terms and provisions of this Agreement or, if not so bound,
executes, prior to or contemporaneously with the consummation of
such transaction an Agreement supplemental hereto and such other
instruments (if any) as are approved by the Holders in accordance
with Article 10 of the Exchangeable Share Provisions and in the
opinion of legal counsel to the Holders (at the cost of Parent)
are necessary or advisable to evidence the agreement of such
Parent Successor to observe and perform all the covenants and
obligations of Parent under this Agreement, the Support Agreement
and the Exchangeable Share Provisions and to be bound by the
covenants of Newco I and Newco II under this Agreement, the
Support Agreement and the Exchangeable Share Provisions; and
(b) such transaction shall, to the satisfaction of the Trustee, be
upon such terms which substantially preserve and do not impair in
any material respect any of the rights, duties, powers and
authorities of the Trustee hereunder; or
(c) the Parent Successor enters into amendments or other agreements
supplemental hereto as are approved by the Holders in accordance
with Article 10 of the Exchangeable Share Provisions.
12.2 VESTING OF POWERS IN PARENT SUCCESSOR. Whenever the conditions of
Section 12.1 hereof have been duly observed and performed, the Trustee, if
required by Section 12.1 hereof, and the Parent Successor shall execute and
deliver the supplemental agreement provided for in Article 13 hereof, and
thereupon the Parent Successor shall possess and from time to time may
exercise each and every right and power of Parent under this Agreement in the
name of Parent or otherwise and any act or proceeding by any provision of
this Agreement required to be done or performed by the board of directors of
Parent or any officers of Parent may be done and performed with like force
and effect by the directors or officers of such Parent Successor.
12.3 SUBSIDIARIES. Nothing herein shall be construed as preventing the
amalgamation or merger of any Subsidiary of Parent with or into Parent or the
voluntary winding-up, liquidation or dissolution of any Subsidiary of Parent
other than Newco I and Newco II provided that all of the assets of such
subsidiary are transferred to Parent or another subsidiary of Parent and that
such transactions do not adversely impact upon the Holders of Exchangeable
Shares; any such transactions are expressly permitted by this Article 12.
- 39 -
ARTICLE 13
AMENDMENTS AND SUPPLEMENTAL AGREEMENTS
13.1 AMENDMENTS, MODIFICATIONS, ETC. Subject to Section 13.4 hereof and
Section 2.8 of the Support Agreement, this Agreement may not be amended or
modified except by an agreement in writing executed by Newco I, Newco II, USA
V, Parent and the Trustee and approved by the Holders in accordance with
Article 10 of the Exchangeable Share Provisions.
13.2 MINISTERIAL AMENDMENTS. Notwithstanding the provisions of Section
13.1 hereof, Newco I, Newco II, USA V, Parent and Trustee may in writing, at
any time and from time to time, without the approval of the Holders but on
reasonable notice to them with sufficient details provided, amend or modify
this Agreement for the purposes of:
(a) adding to the covenants of any or all of the parties hereto for
the protection of the Holders or the Trustee hereunder;
(b) making such amendments or modifications not inconsistent with this
Agreement as may be necessary or desirable with respect to matters
or questions which, in the opinion of the board of directors of
each of Parent, Newco I or Newco II with respect to all matters
and in the opinion of the Trustee and its counsel relating to the
Trust Estate only, having in mind the best interests of the
Holders as a whole, it may be in good faith expedient to make,
provided that such boards of directors with respect to all matters
and the Trustee relating to the Trust Estate only, shall be of the
good faith opinion that such amendments and modifications will not
be prejudicial to the interests of the Holders as a whole; or
(c) making such changes or corrections which, on the written advice of
counsel to Newco I, Newco II, or Parent, and if relating to the
Trust Estate on the advice of Trustee and/or its counsel, are
required for the purpose of curing or correcting any ambiguity or
defect or inconsistent provision or clerical omission or mistake
or manifest error; provided that the Trustee and its counsel
relating to the Trust Estate only, and the board of directors of
each of the Newco I, Newco II and Parent and their counsel with
respect to all matters shall be of the good faith opinion that
such changes or corrections will not be prejudicial to the
interests of the Holders as a whole.
13.3 MEETING TO CONSIDER AMENDMENTS. Newco II at the request of Parent,
Newco I, any five Holders, or such number of Holders holding at least five
percent (5%) of the Exchangeable Shares then outstanding, shall call a
meeting or meetings of the Holders for the purpose of considering any
proposed amendment or modification requiring approval pursuant hereto. Any
such meeting or meetings shall be called and held in accordance with the
- 40 -
Exchangeable Share Provisions and, to the extent applicable, the Articles of
Association of Newco II and all applicable laws. An approval of Holders may
be obtained by written consents in lieu of a meeting, as provided in Article
10 of the Exchangeable Share Provisions.
13.4 CHANGES IN CAPITAL OF PARENT OR NEWCO II. Subject to Section 14.1
hereof and Section 2.8 of the Support Agreement, at all times after the
occurrence of any event effected pursuant to Section 2.7 or Section 2.8 of
the Support Agreement, as a result of which either Parent Common Stock or the
Exchangeable Shares or both are in any way changed, to the extent reasonably
practicable in the circumstances, this Agreement shall forthwith be amended
and modified as necessary in order that it shall apply with full force and
effect, mutatis mutandis, to all new securities into which Parent Common
Stock or the Exchangeable Shares or both are so changed, and Newco I, Newco
II, Parent and Trustee shall execute and deliver a supplemental agreement
giving effect to and evidencing such necessary amendments and modifications.
13.5 EXECUTION OF SUPPLEMENTAL AGREEMENTS. From time to time Parent
(when authorized by a resolution of its Board of Directors), Newco I (when
authorized by a resolution of its board of directors), Newco II (when
authorized by a resolution of its board of directors), and the Trustee may,
subject to the provisions of these presents, and they shall, when so directed
by these presents, execute and deliver by their proper officers, agreements
or other instruments supplemental hereto, which thereafter shall form part
hereof, for any one or more of the following purposes:
(a) evidencing the succession of any Parent Successor to Parent and
the covenants of and obligations assumed by each such Parent
Successor in accordance with the provisions of Article 12 and the
successor of any successor trustee in accordance with the
provisions of Article 11;
(b) making any additions to, deletions from or alterations of the
provisions of this Agreement or the Voting Rights, the Exchange
Put Right, the Exchange Right, the Automatic Exchange Right, the
Liquidation Call Right, the Redemption Call Right or the
Retraction Call Right which the boards of directors of Parent,
Newco I and Newco II in good faith are of the opinion and based
upon written advice from counsel, will not be prejudicial to the
interests of the Holders as a whole or are necessary or advisable
in order to incorporate, reflect or comply with any legislation
the provisions of which apply to Parent, Newco I or Newco II, the
Holders, the Trustee or this Agreement; and
(c) for any other purposes not inconsistent with the provisions of
this Agreement, including, without limitation, to make or evidence
any amendment or modification to this Agreement as contemplated
- 41 -
hereby, provided that if the Holders have not approved the
applicable amendment or modification, the Trustee and its counsel
relating to the Trust Estate only and the boards of directors of
Parent, Newco I and Newco II in good faith and upon written advice
of counsel are of the opinion that the rights of the Trustee and
Holders will not be prejudiced thereby.
ARTICLE 14
TERMINATION AND AUTOMATIC REDEMPTION
14.1 PROVISIONS FOR AUTOMATIC REDEMPTION. Notwithstanding any
limitation contained in Article 12 or elsewhere in this Agreement, the
Support Agreement or the Exchangeable Share Provisions, if the terms for an
Automatic Redemption Date are applicable in connection with an ACG Control
Transaction, then in lieu of amending this Agreement or entering into a
supplemental agreement in connection with the ACG Control Transaction, Parent
may cause Newco II to redeem or Newco I to purchase all the Exchangeable
Shares of Holder pursuant to the provisions for automatic redemption in
Article 7 of the Exchangeable Share Provisions and Article 6 of this
Agreement.
14.2 TERM. This Agreement shall continue until the earliest to occur of
the following events:
(a) no outstanding Exchangeable Shares are held by a Holder,
(b) each of Newco I, Newco II and Parent elects in writing to
terminate this Agreement and such termination is approved by the
Holders in accordance with Article 10 of the Exchangeable Share
Provisions; and
(c) five (5) years and sixty (60) days after the date of this Agreement.
14.3 SURVIVAL OF CERTAIN PROVISIONS. The provisions of Articles 9 and
10 hereof shall survive any such termination of this Agreement.
ARTICLE 15
GENERAL
15.1 SEVERABILITY. If any provision of this Agreement is held to be
invalid, illegal or unenforceable, the validity, legality or enforceability
of the remainder of this Agreement shall not in any way be affected or
impaired thereby, and the Agreement shall be carried out as nearly as
possible in accordance with its original terms and conditions.
15.2 ENUREMENT. This Agreement shall be binding upon and enure to the
benefit of the parties hereto, the Holders and their respective successors
and permitted assigns. The Company shareholders party to this Agreement are
contemplated to become Holders hereunder when the Class A Special Shares
- 42 -
are issued on the Closing Date. Upon any such party becoming a Holder
hereunder, such party will be party to this Agreement in its capacity as a
Holder, and upon any substitution of Class A Special Shares in connection
with the Newco II Amalgamation, shall remain a Holder hereunder. Any
transferee hereafter becoming a Holder shall be substituted for its
transferor under this Agreement upon the date of such transfer, and the
transferor shall be released from any obligations or liability thereafter
arising under this Agreement. From and after the Newco II Amalgamation, the
parties expressly confirm that the Amalgamated Newco II shall automatically
succeed to and become obligated to perform all the obligations of Newco II
hereunder and shall be entitled to all the rights of Newco II and for all
intents and purposes of this Agreement shall thereupon become the Newco II
party hereunder.
15.3 NOTICES TO PARTIES. All notices and other communications between
the parties hereunder which affect all Holders shall be in writing and shall
be deemed to have been given if delivered to the parties or by confirmed
telecopy to the parties at the following addresses (or at such other address
for such party as shall be specified in like notice):
TO PARENT, NEWCO I,
USA V OR NEWCO II: c/o 000 Xxxxx Xxxxx Xxxx Xxxx
Xxxxx 000
Xx. Xxxxx, Xxxxxxxx
X.X.X. 63017
Attention: the President
Facsimile No.: (000) 000-0000
WITH COPIES TO:
Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx
X.X.X. 00000-0000
Attention: Xxxxx Xxxxx
FACSIMILE NO: (000) 000-0000
AND
XxXxxxx Xxxxxx
0000 Xxxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxx Xxxxxx
Xxxxxx
X0X 0X0
Attention: Xxxxxx Xxxxxxx
FACSIMILE NO: (000) 000-0000
AND
- 43 -
Imperial Capital Limited
1 First Canadian Place
P.O. Box 438
Suite 5102
Xxxxxxx XX X0X 0X0
Attention: Managing Partner
FACSIMILE NO.: (000) 000-0000
AND
Xxxxxxx, Xxxxx & Xxxxxxxxx LLP
Scotia Plaza, Suite 2100
00 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Attention: Xxxxxxx Xxxxxxx
FACSIMILE NO: (000) 000-0000
TO THE HOLDERS:
At their respective addresses
appearing on the records of
the Transfer Agent
WITH COPIES TO:
Imperial Capital Limited
1 First Canadian Place
P.O. Box 438
Suite 5102
Xxxxxxx XX X0X 0X0
Attention: Managing Partner
FACSIMILE NO.: (000) 000-0000
AND:
Xxxxxxx, Xxxxx & Xxxxxxxxx LLP
Scotia Plaza, Suite 2100
00 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Attention: Xxxxxxx Xxxxxxx
FACSIMILE NO: (000) 000-0000
- 44 -
TO THE TRUSTEE:
Montreal Trust Company of Canada
Corporate Services Division
000 Xxxxx Xx. Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Attention: Manager
FACSIMILE NO: (000) 000-0000
WITH COPIES TO:
Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx
X.X.X. 00000-0000
Attention: Xxxxx Xxxxx
FACSIMILE NO: (000) 000-0000
AND
XxXxxxx Xxxxxx
0000 Xxxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxx Xxxxxx
Xxxxxx
X0X 0X0
Attention: Xxxxxx Xxxxxxx
FACSIMILE NO: (000) 000-0000
AND
Xxxxxxx, Xxxxx & Xxxxxxxxx LLP
Scotia Plaza, Suite 2100
00 Xxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Attention: Xxxxxxx Xxxxxxx
FACSIMILE NO: (000) 000-0000
TO TRANSFER AGENT:
Continental Stock Transfer & Trust Company
0 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Compliance Department
FACSIMILE NO.: (000) 000-0000
Any notice or other communication given personally or by overnight or expedited
delivery service shall be deemed to have been given and received upon delivery
- 45 -
thereof, and if given by telecopy shall be deemed to have been given and
received on the date of receipt thereof unless such day is not a Business Day
in which case it shall be deemed to have been given and received upon the
immediately following Business Day. Save and except any notice actually
received earlier (in which case the notice shall be deemed given on the
Business Day received), any notice given by certified or registered mail
shall be deemed to have been given and received on the fifth Business Day
following the date of mailing, and any notice period providing for notice to
be given by twenty (20) or more days before a specified date or event may be
calculated as if the date of mailing were the date of giving notice. This
Section shall not affect the manner of Trustee providing communications to
Holders as set forth in Article 4 or the manner of Trustee and Parent
communicating with each other to carry out the provisions of Article 4.
Notices covered by Section 15.4 are not covered by this Section.
15.4 NOTICE TO NEWCO II, NEWCO I, AND PARENT.
(a) Except as otherwise herein provided, any notice and other
communications to be given to Newco II, Newco I, USA V or Parent by a Holder
of Exchangeable Shares shall be in writing and shall be valid and effective
if given by mail (postage prepaid) or by confirmed telecopy or by delivery:
(i) if in connection with a redemption, exchange, purchase or
retraction of Exchangeable Shares or exercise of any right
with respect thereto, addressed to Newco II, Newco I, USA V
or Parent, as the case may be, c/o the Transfer Agent at the
Transfer Agent Office;
(ii) otherwise to the applicable entity at the address from time
to time specified for such entity in Section 15.3 above,
provided copies of such notice need not be sent to the
parties above shown as to receive copies in Section 15.3
unless such notice affects all Holders.
(b) Notwithstanding any requirement for written notice in this
Agreement, any notices provided herein to be given as between or among Newco
I, Newco II, Parent, USA V and Transfer Agent may be given by telephone, by
fax or otherwise in an informal manner as such entities may agree among
themselves from time to time and such notices may be subject to standing
orders. For example, Newco I may advise the Transfer Agent and Newco II that
upon any Retraction Request, Newco I desires to exercise the Retraction Call
Right, in which event the Newco I Retraction Call Notice shall be deemed
properly given to Newco II upon any Retraction Request received by the
Transfer Agent until Newco I rescinds or otherwise modifies such standing
order.
(c) Section 13.6 of the Exchangeable Share Provisions shall be
applicable hereto in the same manner as if set forth herein (dealing with
notice of
- 46 -
change in the identity of the Transfer Agent or change in the Transfer Agent
Office). Any requirement for written notice hereunder may also be waived by
the parties directly affected by a particular notice, including the
applicable Holder, and any period for giving a notice or otherwise taking an
action may be extended with the consent of all affected parties, including
the applicable Holder.
15.5 NOTICE TO HOLDERS. Any and all notices to be given and any
documents to be sent to any Holders may be given or sent to the address of
such Holder shown on the records of the Transfer Agent in any manner
permitted by the Exchangeable Share Provisions and shall be deemed to be
received (if given or sent in such manner) at the time specified in such
Exchangeable Share Provisions, the provisions of which Exchangeable Share
Provisions shall apply mutatis mutandis to notices or documents as aforesaid
sent to such Holders. If a notice to any Holder does not affect all Holders,
copies of such notice need not be sent to the parties above shown in Section
15.3 as to receive copies of notices to Holders.
15.6 COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument. One or more of the parties may sign
this Agreement and deliver this Agreement by facsimile transmission. The
parties agree that a facsimile of a signature shall be deemed an original
signature.
15.7 CONSTRUCTION. The parties hereto, except the Trustee, agree that
they have been represented by counsel during the negotiation and execution of
this Agreement and, therefore, waive the application of any law, regulation,
holding or rule of construction providing that ambiguities in an agreement or
other document will be construed against the party drafting such agreement or
document.
15.8 JURISDICTION. Except to the extent that the Delaware and Nova
Scotia corporate laws under which the Parent, Newco I and Newco II are,
respectively, organized govern the determination of particular corporate
issues under this Agreement, this Agreement shall be construed and enforced
in accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein.
15.9 ATTORNMENT. Each of the parties hereto, on behalf of such party
and such party's heirs, personal representative, successors and permitted
assigns, agrees that any action or proceeding arising out of or relating to
this Agreement may be instituted in the courts of Ontario, waives any
objection which it may have now or hereafter to the venue of any such action
or proceeding, irrevocably submits to the jurisdiction of such courts in any
such action or proceeding, and agrees to be bound by any judgment of such
courts and agrees not to seek, and hereby waives, any review of the merits of
any such judgment by the courts of any other jurisdiction.
- 47 -
15.10 EFFECTIVENESS OF AGREEMENT. This Agreement is being entered into
in anticipation of the "Closing" under the YPtel Agreement and the related
issuance of Class A Special Shares to certain of the Company shareholders in
exchange for some of their Company shares. This Agreement shall not become
effective until the Class A Special Shares are so issued at such Closing on
or before March 1, 2000, failing which, this Agreement shall be null and void.
15.11 TIME OF THE ESSENCE. Time shall be of the essence of this
Agreement and every party thereof.
[THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties hereby have caused this Exchange and
Voting Trust Agreement to be duly executed as of the date first above written.
ADVANCED COMMUNICATIONS GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxx
--------------------------
ACG HOLDING COMPANY
By: /s/ Xxxxxxx X. Xxxxx
--------------------------
ACG EXCHANGE COMPANY
By: /s/ Xxxxxxx X. Xxxxx
--------------------------
1 + USA V ACQUISITION CORP.
By: /s/ Xxxxxxx X. Xxxxx
--------------------------
CERTAIN HOLDERS OF SHARES OF YPTEL
LIMITED who will become Holders of
Class A Special Shares, as set out
on Schedule A hereto, by their
respective General Partners set out
on said Schedule
By: /s/ Xxxxxx Xxxxxx
--------------------------
Xxxxxx Xxxxxx,
Authorized Signing Officer for
each General Partner
YPtel/ACG Pledge Corporation will be a Holder of certain Class A Special
Shares pledged to it and joins in the above Agreement as a Holder pursuant to
the provisions of Section 7.3 of the Agreement.
YPTEL/ACG PLEDGE CORPORATION
By: /s/ Xxxxxx Xxxxxx
---------------------------
MONTREAL TRUST COMPANY OF
CANADA
By: /s/ Xxxxxx Xxxxxx
---------------------------
XXXXXX XXXXXX
CORPORATE TRUST OFFICER
By: /s/ X. Xxxxx
---------------------------
XXXXX XXXXX
SENIOR CORPORATE TRUST OFFICER
[Exchange and Voting Trust Agreement among Advanced Communications Group, Inc.,
other parties and Montreal Trust Company of Canada, as Trustee]
SCHEDULE A
THOSE OF THE FOLLOWING HOLDERS OF SHARES OF COMPANY (YPTEL LIMITED)
WHO BECOME HOLDERS OF CLASS A SPECIAL SHARES
------------------------------------------------------------------------------
GENERAL PARTNER LIMITED PARTNERSHIP
------------------------------------------------------------------------------
ACG 1 Inc. ACG 1 Limited Partnership
------------------------------------------------------------------------------
ACG 2 Inc. ACG 2 Limited Partnership
------------------------------------------------------------------------------
ACG 3 Inc. ACG 3 Limited Partnership
------------------------------------------------------------------------------
ACG 4 Inc. ACG 4 Limited Partnership
------------------------------------------------------------------------------
ACG 5 Inc. ACG 5 Limited Partnership
------------------------------------------------------------------------------
ACG 6 Inc. ACG 6 Limited Partnership
------------------------------------------------------------------------------
ACG 7 Inc. ACG 7 Limited Partnership
------------------------------------------------------------------------------
ACG 8 Inc. ACG 8 Limited Partnership
------------------------------------------------------------------------------
ACG 9 Inc. ACG 9 Limited Partnership
------------------------------------------------------------------------------
ACG 10 Inc. ACG 10 Limited Partnership
------------------------------------------------------------------------------
ACG 11 Inc. ACG 11 Limited Partnership
------------------------------------------------------------------------------
ACG 12 Inc. ACG 12 Limited Partnership
------------------------------------------------------------------------------
ACG 13 Inc. ACG 13 Limited Partnership
------------------------------------------------------------------------------
ACG 14 Inc. ACG 14 Limited Partnership
------------------------------------------------------------------------------
ACG 15 Inc. ACG 15 Limited Partnership
------------------------------------------------------------------------------
ACG 16 Inc. ACG 16 Limited Partnership
------------------------------------------------------------------------------
ACG 17 Inc. ACG 17 Limited Partnership
------------------------------------------------------------------------------
ACG 18 Inc. ACG 18 Limited Partnership
------------------------------------------------------------------------------
ACG 19 Inc. ACG 19 Limited Partnership
------------------------------------------------------------------------------
ACG 20 Inc. ACG 20 Limited Partnership
------------------------------------------------------------------------------
ACG 21 Inc. ACG 21 Limited Partnership
------------------------------------------------------------------------------
ACG 22 Inc. ACG 22 Limited Partnership
------------------------------------------------------------------------------
ACG 23 Inc. ACG 23 Limited Partnership
------------------------------------------------------------------------------
ACG 24 Inc. ACG 24 Limited Partnership
------------------------------------------------------------------------------
ACG 25 Inc. ACG 25 Limited Partnership
------------------------------------------------------------------------------
ACG 26 Inc. ACG 26 Limited Partnership
------------------------------------------------------------------------------
ACG 27 Inc. ACG 27 Limited Partnership
------------------------------------------------------------------------------
ACG 28 Inc. ACG 28 Limited Partnership
------------------------------------------------------------------------------
ACG 29 Inc. ACG 29 Limited Partnership
------------------------------------------------------------------------------
ACG 30 Inc. ACG 30 Limited Partnership
------------------------------------------------------------------------------
ACG 31 Inc. ACG 31 Limited Partnership
------------------------------------------------------------------------------
ACG 32 Inc. ACG 32 Limited Partnership
------------------------------------------------------------------------------
ACG 33 Inc. ACG 33 Limited Partnership
------------------------------------------------------------------------------
ACG 34 Inc. ACG 34 Limited Partnership
------------------------------------------------------------------------------
ACG 35 Inc. ACG 35 Limited Partnership
------------------------------------------------------------------------------
ACG 36 Inc. ACG 36 Limited Partnership
------------------------------------------------------------------------------
ACG 37 Inc. ACG 37 Limited Partnership
------------------------------------------------------------------------------
ACG 38 Inc. ACG 38 Limited Partnership
------------------------------------------------------------------------------
------------------------------------------------------------------------------
GENERAL PARTNER LIMITED PARTNERSHIP
------------------------------------------------------------------------------
ACG 39 Inc. ACG 39 Limited Partnership
------------------------------------------------------------------------------
ACG 40 Inc. ACG 40 Limited Partnership
------------------------------------------------------------------------------
ACG 41 Inc. ACG 41 Limited Partnership
------------------------------------------------------------------------------
ACG 42 Inc. ACG 42 Limited Partnership
------------------------------------------------------------------------------
THIS NOTICE MAY BE EXERCISED AT ANY TIME
FORM 1
NOTICE OF EXCHANGE PUT RIGHT
TO: ACG Holding Company ("Newco I") and
Advanced Communications Group, Inc. ("Parent")
c/o Continental Stock Transfer & Trust Company
(the "Transfer Agent")
0 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Compliance Department
Fax: (000) 000-0000
This notice is given pursuant to Section 5.6 of the provisions of
the Exchange and Voting Trust Agreement referred to in the Exchange Agent
Letter referred to below and except as otherwise defined herein all
capitalized words and expressions used in this notice which are defined in
the Exchange and Voting Trust Agreement have the meaning attributed to such
words and expressions in the Exchange and Voting Trust Agreement.
The undersigned hereby notifies Parent and Newco I that the
undersigned hereby exercises the Exchange Put Right so as to require Parent
or Newco I to purchase from the undersigned in accordance with Article 5 of
the Exchange and Voting Trust Agreement:
/ / All share(s) represented by the certificates held for the
undersigned by the Transfer Agent; or
/ / Class A Special Share(s) only (a minimum of 1,000 shares)
The undersigned hereby notifies the Transfer Agent that the purchase
shall be in accordance with the Exchange Agent Letter between ACG Exchange
Company ("Newco II"), Newco I, 1 + USA V Acquisition Corp., Parent and the
Transfer Agent.
The undersigned hereby represents and warrants to Parent and Newco I
that the undersigned has good title to, and owns, the Class A Special
Share(s) represented by the undersigned's certificate(s) for the Class A
Special Shares
held by the Transfer Agent free and clear of all liens, claims, encumbrances,
security interests and adverse claims or interests.
For value received, the undersigned does hereby sell, assign and
transfer unto Parent or Newco I (as applicable) the number of Class A Special
Shares of Newco II as referenced in the box checked above, and does hereby
irrevocably constitute and appoint the Transfer Agent attorney to transfer
the said stock on the books of Newco II with the full power of substitution
in the premises.
/ / Please check box if the legal or beneficial owner of the
Class A Special Shares is NOT a resident of Canada.
Parent Common Stock shall be delivered in accordance with instructions
previously provided to the Transfer Agent by or in behalf of the undersigned
unless contrary instructions are received by the Transfer Agent at least 48
hours prior to the Transfer Agent's receipt of this Notice of Exchange Put
Right or unless contrary instructions accompany this Notice.
____________________, 200__
Date
[Name of Shareholder Entity]
______________________________
Witness: Signature of Person Signing
Print Name: __________________
_________________________________________
Address:
______________________________
Street and Number City
______________________________
Province, Postal Code
NOTE: PLEASE PROVIDE TELECOPY NUMBER AND
TELEPHONE NUMBER AT WHICH SHAREHOLDER
CAN BE REACHED:
__________________________
telecopy number
__________________________
telecopy number
NOTE: IF THE NOTICE OF EXCHANGE PUT RIGHT IS FOR
LESS THAN ALL OF THE SHARE(S) REPRESENTED BY
THE CERTIFICATE(S) HELD BY THE TRANSFER
AGENT FOR THE SHAREHOLDER, A CERTIFICATE
REPRESENTING THE REMAINING CLASS A SPECIAL
SHARES WILL BE ISSUED AND REGISTERED IN THE
NAME OF THE SHAREHOLDER AS IT APPEARS ON THE
REGISTER OF ACG EXCHANGE COMPANY.
THIS FORM TO BE USED ONLY IF YOU RECEIVE NOTICE OR
YOU OTHERWISE BECOME AWARE OF AN INSOLVENCY EVENT AFFECTING
ACG EXCHANGE COMPANY
FORM 2
NOTICE OF EXCHANGE RIGHT
TO: ACG Holding Company ("Newco I") and
Advanced Communications Group, Inc. ("Parent")
c/o Continental Stock Transfer & Trust Company
(the "Transfer Agent")
0 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Compliance Department
Fax: (000) 000-0000
This notice is given pursuant to Section 5.6 of the provisions of
the Exchange and Voting Trust Agreement referred to in the Exchange Agent
Letter referred to below and except as otherwise defined herein all
capitalized words and expressions used in this notice which are defined in
the Exchange and Voting Trust Agreement have the meaning attributed to such
words and expressions in the Exchange and Voting Trust Agreement.
An Insolvency Event has occurred; a copy of the notice from Parent,
Newco I or ACG Exchange Company ("Newco II") to that effect is attached
hereto or a notarized affidavit of the applicable facts is attached hereto.
The undersigned hereby notifies Parent and Newco I that the
undersigned hereby exercises the Exchange Right so as to require Parent or
Newco I to purchase from the undersigned in accordance with Article 5 of the
Exchange and Voting Trust Agreement:
/ / all share(s) represented by the certificates held for
the undersigned by the Transfer Agent; or
/ / Class A Special Share(s) only (a minimum of 1,000 shares)
The undersigned hereby notifies the Transfer Agent that the purchase
shall be in accordance with the Exchange Agent Letter between Newco II, Newco
I, 1 + USA V Acquisition Corp., Parent and the Transfer Agent.
The undersigned hereby represents and warrants to Parent and Newco I
that the undersigned has good title to, and owns, the Class A Special
Share(s)
represented by the undersigned's certificate(s) for the Class A Special
Shares held by the Transfer Agent free and clear of all liens, claims,
encumbrances, security interests and adverse claims or interests.
For value received, the undersigned does hereby sell, assign and
transfer unto Parent or Newco I (as applicable) the number of Class A Special
Shares of Newco II as referenced in the box checked above, and does hereby
irrevocably constitute and appoint the Transfer Agent attorney to transfer
the said stock on the books of Newco II with the full power of substitution
in the premises.
/ / Please check box if the legal or beneficial owner of the Class
A Special Shares is NOT a resident of Canada.
Parent Common Stock shall be delivered in accordance with instructions
previously provided to the Transfer Agent by or in behalf of the undersigned
unless contrary instructions are received by the Transfer Agent at least 48
hours prior to the Transfer Agent's receipt of this Notice of Exchange Right
or unless contrary instructions accompany this Notice.
____________________, 200__
Date
[Name of Shareholder Entity]
Witness:
___________________________
Signature of Person Signing
_________________________ Print Name: _______________
Address:
____________________________
Street and Number City
____________________________
Province, Postal Code
NOTE: PLEASE PROVIDE TELECOPY NUMBER AND
TELEPHONE NUMBER AT WHICH SHAREHOLDER
CAN BE REACHED:
__________________________
telecopy number
__________________________
telecopy number
NOTE: IF THE NOTICE OF EXCHANGE RIGHT IS FOR LESS
THAN ALL OF THE SHARE(S) REPRESENTED BY THE
CERTIFICATE(S) HELD BY THE TRANSFER AGENT
FOR THE SHAREHOLDER, A CERTIFICATE
REPRESENTING THE REMAINING CLASS A SPECIAL
SHARES WILL BE ISSUED AND REGISTERED IN THE
NAME OF THE SHAREHOLDER AS IT APPEARS ON THE
REGISTER OF ACG EXCHANGE COMPANY.
