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EXHIBIT 10.5
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
Amended and Restated Registration Rights Agreement dated as of May 30,
2001 among CAI CAPITAL PARTNERS AND COMPANY II, L.P., a limited partnership
formed under the laws of the Province of Ontario (the "CANADIAN PARTNERSHIP"),
CAI PARTNERS AND COMPANY II, L.P., a limited partnership formed under the laws
of the Province of Ontario (the "U.S. PARTNERSHIP"), CAI CAPITAL PARTNERS AND
COMPANY II-C, L.P., a limited partnership formed under the laws of the Province
of Ontario ("II-C") and CAI MANAGERS & CO., L.P., a limited partnership formed
under the laws of the State of Delaware and, collectively with the Canadian
Partnership, the U.S. Partnership and II-C , the "CAI ENTITIES" and each a "CAI
ENTITY"), 597858 B.C. LTD., a corporation incorporated under the laws of the
Province of British Columbia ("B.C."), as agent, ONTARIO TEACHERS' PENSION PLAN
BOARD, an entity existing under the laws of the Province of Ontario (the
"INSTITUTIONAL INVESTOR"), MDA HOLDINGS CORPORATION, ("HOLDCO"), a wholly-owned
subsidiary of ORBITAL SCIENCES CORPORATION, a corporation incorporated under the
laws of the State of Delaware ("ORBITAL") and XXXXXXXXX, XXXXXXXXX AND
ASSOCIATES LTD., a corporation amalgamated under the laws of Canada (the
"CORPORATION").
RECITALS:
(a) The parties hold or may hold common shares (the "COMMON SHARES") in the
capital of the Corporation.
(b) The CAI Entities, B.C., Orbital and the Corporation entered into a
subscription agreement dated as of December 22, 1999, as amended June 29,
2000 pursuant to which the CAI Entities and B.C. originally acquired an
equity interest in the Corporation (the "SUBSCRIPTION AGREEMENT").
(c) The Corporation granted certain registration rights to the CAI Entities,
B.C. and Orbital which were set forth in Schedule "F" attached to the
Subscription Agreement (the "REGISTRATION RIGHTS AGREEMENT").
(d) Following the closing of the Subscription Agreement, Orbital transferred
all of the Common Shares held by it in the Corporation to its
wholly-owned subsidiary, Holdco.
(e) The CAI Entities, B.C. and the Institutional Investor entered into a
letter agreement dated April 12, 2001 (the "PURCHASE AGREEMENT") with
Holdco to purchase 12,350,000 of 18,000,000 Common Shares of the
Corporation held by Holdco (the "PURCHASED SHARES").
(f) The CAI Entities and B.C. were granted an option to purchase, and
ancillary rights in respect of, the balance of the 5,650,000 Common
Shares held by Holdco
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pursuant to an Amended and Restated Option Agreement dated May 30, 2001
among Holdco, Orbital, the CAI Entities and B.C.
(g) The CAI Entities, B.C., the Institutional Investor, Holdco and the
Corporation have entered into this Agreement for the purpose of setting
forth the registration rights applicable to certain Common Shares and
related matters.
In consideration of the foregoing and the mutual agreements contained
herein (the receipt and adequacy of which are acknowledged), the parties agree
as follows:
ARTICLE 1
DEFINITIONS AND PRINCIPLES OF INTERPRETATION
SECTION 1.1 DEFINITIONS
The terms defined in this Article 1 shall for all purposes of this
Agreement have the meanings herein specified unless the subject matter or
context otherwise requires:
"ACT" means the Canada Business Corporations Act, as amended;
"ADDITIONAL PIGGYBACK RIGHTS" has the meaning specified in Section
2.1(f)(ii);
"AFFILIATE" shall mean with respect to any Person, any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such Person;
"AMENDED AND RESTATED OPTION AGREEMENT" means the amended and restated
option agreement dated as of May 30, 2001 among the CAI Entities, B.C.,
Holdco and Orbital in which Holdco granted an option to purchase the
Remaining Shares and certain ancillary rights to the CAI Entities and
B.C.;
"B.C." means 597858 B.C. Ltd., a corporation incorporated under the laws
of the Province of British Columbia;
"BOARD" shall mean the board of directors of the Corporation;
"CAI ENTITIES" means CAI Capital Partners and Company II, L. P., CAI
Partners and Company II, L. P., CAI Capital Partners and Company II-C,
L.P. and CAI Managers & Co., L.P.;
"CANADIAN PROSPECTUS" shall mean a prospectus prepared in accordance with
applicable Canadian Securities Laws for the purposes of qualifying
securities for distribution or distribution to the public, as the case
may be, in any province or territory of Canada;
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"CANADIAN SECURITIES LAWS" shall mean the statutes and regulations
applicable to the trading of securities in any province or territory of
Canada including applicable rules, policy statements and blanket rulings
and orders promulgated by Canadian securities regulatory authorities;
"CLOSING DATE" shall mean May 30, 2001, the date the purchase and sale of
the Common Shares of the Corporation pursuant to the Purchase Agreement
is completed;
"COMMISSION" shall mean the United States Securities and Exchange
Commission;
"CONTROLLED" means controlled within the meaning of the Act, and
"Control" has a similar meaning.
"CORPORATION" means XxxXxxxxx, Xxxxxxxxx & Associates Ltd.;
"CORPORATION SECURITIES" has the meaning specified in Section 2.3(b)(i);
"DEMAND EXERCISE NOTICE" has the meaning specified in Section 2.1(a);
"DEMAND REGISTRATION" has the meaning specified in Section 2.1(a);
"DEMAND REGISTRATION REQUESTS" has the meaning specified in Section
2.1(a);
"DOLLARS" shall mean, unless otherwise indicated, Canadian dollars, and
the symbol "C$" shall refer to Canadian dollars;
"EXCHANGE ACT" shall mean the United States Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the relevant time;
"EXERCISING PERSON" has the meaning specified in Section 2.9(a);
"HOLDCO" means MDA Holdings Corporation, a wholly-owned subsidiary of
Orbital;
"HOLDER" or "HOLDERS" shall mean (subject to Section 3.11) (i) each
Investor while it holds Registrable Securities and (ii) each Person or
Persons holding Registrable Securities as a result of a transfer or
assignment made pursuant to Sections 2.2(1), (2) or (6), Sections 2.3 of
the Resale Restrictions Agreement (as such Sections are in effect on the
date hereof) or Persons to whom the CAI Entities or B.C., as the case may
be, Transfer their rights under the Institutional Option Agreement or
their Remaining Shares pursuant to Sections 3.13(1) and (2) of the Resale
Restrictions Agreement (as such Sections are in effect on the date
hereof);
"INITIATING HOLDERS" has the meaning specified in Section 2.1(a);
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"INSTITUTIONAL INVESTOR" means the Ontario Teachers' Pension Plan Board;
"INSTITUTIONAL OPTION AGREEMENT" means the option agreement dated as of
May 30, 2001 between, among others, the CAI Entities, B.C. and the
Institutional Investor.
"INVESTOR SECURITIES" has the meaning specified in Section 2.3(b)(ii);
"INVESTORS" means CAI Capital Partners and Company II, L.P., CAI Partners
and Company II, L.P., CAI Capital Partners and Company II-C, L.P., CAI
Managers & Co., L.P., B.C. and the Institutional Investor;
"ISSUE PRICE" means $7.50 per Common Share for Common Shares issued
pursuant to the Subscription Agreement.
"MAJOR HOLDER" has the meaning specified in Section 2.4(a);
"ORBITAL" means Orbital Sciences Corporation, a corporation incorporated
under the laws of the State of Delaware;
"PERSON" means an individual, corporation, limited liability company,
body corporate, partnership, limited partnership, joint venture,
association, trust or unincorporated organization, any trustee, executor,
administrator or other legal representative, or any government or
governmental entity;
"REGISTER" "REGISTERED" and "REGISTRATION" shall refer to a registration
effected by preparing and filing a registration statement (including the
prospectus contained therein) in compliance with the U.S. Securities Act
and the declaration or ordering of the effectiveness of such registration
statement by the Commission. In addition, unless inconsistent with the
context:
(i) the term "registration" and any references to the act of
registering includes the qualification under Canadian
Securities Laws of a Canadian Prospectus for which a final
receipt has been issued in respect of a distribution or
distribution to the public, as the case may be, of Common
Shares;
(ii) the term "registered" as applied to any Common Shares
includes a distribution or distribution to the public, as
the case may be, of any Common Shares so qualified;
(iii) the term "registration statement" includes a Canadian
Prospectus;
(iv) any references to a registration statement having become
effective, or similar references, shall include a Canadian
Prospectus for
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which a final receipt has been obtained from the relevant
Canadian securities regulatory authorities; and
(v) the provisions of this Agreement shall be applied, mutatis
mutandis, to any proposed distribution of Common Shares
hereunder in any province or territory of Canada or to
which the prospectus requirements under any of the Canadian
Securities Laws shall otherwise apply;
"REGISTRABLE SECURITIES" shall mean
(i) any Common Shares (which for greater certainty includes the
Purchased Shares) held as of the date hereof by the
Investors or Holdco;
(ii) any Remaining Shares acquired pursuant to the Amended and
Restated Option Agreement by the CAI Entities and B.C.;
(iii) any additional Common Shares acquired by the CAI Entities
or B.C., as the case may be, pursuant to the Institutional
Option Agreement;
(iv) any Common Shares issued or issuable, directly or
indirectly, upon any subdivision, combination or
reclassification of such Common Shares (which for greater
certainty includes the Purchased Shares), additional Common
Shares and Remaining Shares, if applicable, or share
dividends in respect of such Common Shares, additional
Common Shares and the Remaining Shares, if applicable,
referenced in clauses (i), (ii) and (iii) above.
As to any particular Registrable Securities, such securities shall cease
to be Registrable Securities when (i) a registration statement with
respect to the sale of such securities shall have been declared effective
under the applicable Securities Laws and such securities shall have been
disposed of in accordance with such registration statement; (ii) such
securities shall have been resold by the Holder thereof pursuant to Rule
144 (or any successor provision) under the U.S. Securities Act and in
compliance with the requirements of Rule 144 and are not subject to any
resale restrictions in the hands of any subsequent holder or holders
under any Canadian Securities Laws; or (iii) such securities shall have
been otherwise transferred and new certificates not subject to resale
restrictions in the hands of any subsequent holder or holders under the
Securities Laws and not bearing any legend restricting further transfer
shall have been delivered by the Corporation, and no other applicable and
legally binding restriction on transfer under Securities Laws shall
exist;
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"REMAINING SHARES" means the balance of 5,650,000 Common Shares of the
Corporation held by Holdco following the Closing Date which Common Shares
are optioned to (and subject to other rights in favour of) the CAI
Entities and B.C. pursuant to the Amended and Restated Option Agreement;
"RESALE RESTRICTIONS AGREEMENT" means the resale restrictions agreement
dated as of May 30, 2001 among the CAI Entities, B.C. and the
Institutional Investor;
"SECTION 2.1 SALE NUMBER" has the meaning specified in Section 2.3(a);
"SECTION 2.2 SALE NUMBER" has the meaning specified in Section 2.3(b);
"SECURITIES" has the meaning specified in Section 2.3(b)(i);
"SECURITIES LAWS" shall mean, collectively, the U.S. Securities Act, the
U.S. Exchange Act, as amended, and the Canadian Securities Laws;
"U.S. EXCHANGE ACT" shall mean the U.S. Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder,
all as the same shall be in effect at the relevant time;
"U.S. SECURITIES ACT" shall mean the United States Securities Act of
1933, as amended, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the relevant time; and
"VALID BUSINESS REASON" has the meaning specified in Section 2.1(e)(iii).
ARTICLE 2
REGISTRATIONS RIGHTS
SECTION 2.1 DEMAND REGISTRATIONS
(a) Subject to Section 2.1(e), Section 2.1(f), Section 2.3 and Section
2.7 below, at any time and from time to time after the Closing
Date, one or more Investors or Holdco shall have the right to
require the Corporation to file a registration statement in any
Canadian jurisdiction and/or in the United States (if the
Corporation has listed its securities on an exchange in the United
States or on the NASDAQ Stock Market or has otherwise become
subject to the reporting requirements of the U.S. Securities Act
or the U.S. Exchange Act) covering all or part of their respective
Registrable Securities, by delivering a written request to the
Corporation specifying the number of Registrable Securities to be
included in such registration by such Investor(s) or Holdco, as
applicable, and the intended method of distribution thereof. All
requests pursuant to this Section 2.1 are referred to as "DEMAND
REGISTRATION REQUESTS", and the registrations requested are
referred to as "DEMAND REGISTRATIONS". With respect to any Demand
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Registration, the Person (being an Investor or Holdco) that
together with its Affiliates holds a majority of the Registrable
Securities in respect of which such demand for registration is
being made shall be referred to as the "INITIATING HOLDERS". As
promptly as practicable, but no later than ten days after receipt
of a Demand Registration Request, the Corporation shall give
written notice (the "DEMAND EXERCISE NOTICE") of such Demand
Registration Request to all Holders and Holdco.
(b) The Corporation, subject to Section 2.3 and Section 2.7, shall
include in a Demand Registration the Registrable Securities of any
Holder or Holdco who shall have made a written request to the
Corporation for inclusion in such registration (which request
shall specify the maximum number of Registrable Securities
intended to be disposed of by such Holder or Holdco, as
applicable) within 30 days after the date of the Demand Exercise
Notice.
(c) The Corporation shall, as soon as practicable following a Demand
Registration Request, determine the intended method of
distribution, including the jurisdiction(s) for distribution, and
use its reasonable best efforts to effect registration of the
Registrable Securities under the Securities Laws of the relevant
jurisdiction(s) for distribution in accordance with such intended
method of distribution.
(d) Any Holder or Holdco shall have the right to withdraw its request
for inclusion of its Registrable Securities in any registration
statement pursuant to this Section 2.1 by giving written notice to
the Corporation of its request to withdraw; provided, however,
that:
(i) such request must be made in writing prior to the execution
of the underwriting agreement (or such other similar
agreement) with respect to such registration; and
(ii) such withdrawal shall be irrevocable and, after making such
withdrawal, a Holder or Holdco, as applicable, shall no
longer have any right to include Registrable Securities in
the registration as to which such withdrawal was made;
and if such withdrawal is made by an Investor or Holdco, as the
case may be, that initiated the Demand Registration Request in
accordance with this Section 2.1(d), then such withdrawal shall
count as a Demand Registration for such Investor or Holdco, as the
case may be, pursuant to Section 2.1(e)(iv) of this Agreement.
(e) The Demand Registration rights granted under Section 2.1 are
subject to the following limitations:
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(i) the Corporation shall not be required to cause a
registration pursuant to Section 2.1 if the Demand
Registration Request is in respect of less than one million
five hundred thousand (1,500,000) Registrable Securities
(after giving effect to any withdrawal pursuant to Section
2.1(d) hereof);
(ii) the Corporation shall not be required to cause a
registration pursuant to Section 2.1 to be declared
effective within a period of (A) 180 days after the
effective date of any registration statement of the
Corporation filed pursuant to a Demand Registration Request
or (B) 90 days after the effective date of any other
registration statement of the Corporation contemplated by
Section 2.2; provided, however, that the provisions of this
Section 2.1(e)(ii) shall only apply to the first
registration statement in any twelve-month period;
(iii) if the Board, in its good faith judgement, determines that
any registration of Registrable Securities should not be
made or continued because it would materially interfere
with any material financing, acquisition, corporate
reorganization or merger or other transaction involving the
Corporation, including Radarsat-3 and National Land
Information Services (a "VALID BUSINESS REASON"),
(A) the Corporation may postpone filing a registration
statement relating to a Demand Registration Request
until such Valid Business Reason no longer exists,
but in no event for more than 90 days during any
12-month period;
(B) in case a registration statement has been filed
relating to a Demand Registration Request, the
Corporation may cause such registration statement to
be withdrawn and its effectiveness terminated or the
Board may postpone amending or supplementing such
registration statement until the Valid Business
Reason no longer exists, but in no event for more
than 90 days during any 12-month period (such period
of postponement or withdrawal under subclauses (A)
or (B) of this paragraph (d), the "POSTPONEMENT
PERIOD"); and
(C) the Corporation shall give written notice of its
determination to postpone or withdraw a registration
statement and of the fact that the Valid Business
Reason for such postponement or withdrawal no longer
exists, in each case, promptly after the occurrence
thereof; and
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(iv) the Corporation shall not be required to effect a
registration pursuant to this Section 2.1 with respect to
more than two Demand Registration Requests from each of (A)
the CAI Entities, collectively, (B) B.C., (C) the
Institutional Investor, and (D) Holdco; however, in the
event that there has not been a bona fide underwritten
secondary and/or treasury public offering within 12 months
following the Closing Date, then the CAI Entities, B.C. and
the Institutional Investor only, shall have in the
aggregate, one additional Demand Registration Right which
shall be subject to the limits set forth in Section 2.1(e),
Section 2.1(f), Section 2.3 and Section 2.7 herein
exercisable by any one of the Investors upon 7 days' notice
to the other Investors prior to the exercise of such Demand
Registration.
If the Corporation shall give any notice of postponement or
withdrawal of any registration statement, the Corporation
shall not, during the Postponement Period register any
Common Shares, other than pursuant to a registration
statement on Form S-4 or S-8 (or an equivalent registration
form then in effect) under the U. S. Securities Act or
other than pursuant to a Canadian Prospectus filed (a) in
connection with a take-over bid, merger, amalgamation or
arrangement transaction including the Corporation or any of
its Affiliates, or (b) in order to qualify Common Shares
for distribution to employees of the Corporation and its
subsidiaries, in each case under Canadian Securities Laws,
if required. Each Holder and Holdco agrees that, upon
receipt of any notice from the Corporation that the
Corporation has determined to withdraw any registration
statement pursuant to clause (iii) above, such party will
discontinue its disposition of Registrable Securities
pursuant to such registration statement and, if so directed
by the Corporation, will deliver to the Corporation all
copies, other than permanent file copies, then in such
party's possession, of the registration statement covering
such Registrable Securities that was in effect at the time
of receipt of such notice. If the Corporation shall have
withdrawn or prematurely terminated a registration
statement filed under Section 2.1 (whether pursuant to this
paragraph (d) or as a result of any stop order, injunction
or other order or requirement of the Commission, any
Canadian securities regulatory authority or any other
governmental agency or court), the Corporation shall not be
considered to have effected an effective registration for
the purposes of this Agreement until the Corporation shall
have filed a new registration statement covering the
Registrable Securities covered by the withdrawn
registration statement and such
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registration statement shall have been declared effective
and shall not have been withdrawn.
(f) The Corporation, subject to Section 2.3 and Section 2.7, may elect
to include in any registration statement and offering made
pursuant to Section 2.1,
(i) authorized but unissued Common Shares issued from the
Corporation's treasury; and
(ii) any other Common Shares which are requested to be included
in such registration pursuant to the exercise of piggyback
registration rights granted by the Corporation after the
date hereof in accordance with the terms of this Agreement
("ADDITIONAL PIGGYBACK RIGHTS");
provided, however, that such inclusion shall be permitted only the
extent that it is pursuant to, and subject to the terms of the
underwriting agreement or arrangements entered into by the
Initiating Holders.
SECTION 2.2 PIGGYBACK REGISTRATIONS
(a) If at any time, the Corporation proposes or is required to
register any of its Common Shares under the Securities Laws of
those jurisdictions selected by the Corporation (other than
pursuant to a registration statement on Form S-4 or S-8 (or an
equivalent registration form then in effect) under the U. S.
Securities Act or other than pursuant to a Canadian Prospectus
filed (a) in connection with a take-over bid, merger, amalgamation
or arrangement transaction including the Corporation or any of its
Affiliates, or (b) in order to qualify Common Shares for
distribution to employees of the Corporation and its subsidiaries,
in each case under Canadian Securities Laws, if required, or other
than in connection with a Demand Registration under Section 2.1 of
this Agreement), whether or not for its own account, the
Corporation shall give prompt written notice of its intention to
do so to each Holder of record and to Holdco. Upon the written
request of any Holder or Holdco, made within 20 days following the
date of any such written notice (which request shall specify the
maximum number of Registrable Securities intended to be disposed
of by each such Holder or Holdco), the Corporation shall, subject
to Section 2.2(b), Section 2.3 and Section 2.7 hereof, use its
reasonable best efforts to cause all the Registrable Securities of
the Holders or Holdco, as applicable, which have so requested the
registration thereof, to be registered under such Securities Laws
(with the securities which the Corporation at the time proposes to
register) to permit the sale or other disposition by the Holders
and Holdco, as applicable, of the Registrable Securities to be so
registered. No registration effected under this
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Section 2.2(a) shall relieve the Corporation of its obligations to
effect Demand Registrations under Section 2.1. Each Holder and
Holdco shall be entitled to have its Common Shares included in an
unlimited number of registrations pursuant to this Section 2.2(a).
(b) If at any time after giving written notice of its intention to
register any Common Shares and prior to the effective date of the
registration statement filed in connection with such registration,
the Corporation shall determine for any reason not to register or
to delay completion of registration of such Common Shares, the
Corporation may, at its election, give written notice of such
determination to all Holders and Holdco, and
(i) in the case of a determination not to complete a
registration, shall be relieved of its obligation to
register any Registrable Securities in connection with such
abandoned registration, without prejudice, however, to the
rights of Holders and Holdco under Section 2.1; and
(ii) in the case of a determination to delay such registration
of its Common Shares, shall be permitted to delay the
completion of registration of such Registrable Securities
for the same period as the delay in registering such other
Common Shares.
(c) Any Holder or Holdco shall have the right to withdraw its request
for inclusion of its Registrable Securities in any registration
statement pursuant to this Section 2.2 by giving written notice to
the Corporation of its request to withdraw; provided, however,
that:
(i) such request must be made in writing prior to the execution
of the underwriting agreement (or such other similar
agreement) with respect to such registration; and
(ii) such withdrawal shall be irrevocable and, after making such
withdrawal, the Holder(s) or Holdco, as applicable, shall
no longer have any right to include Registrable Securities
in the registration as to which such withdrawal was made.
SECTION 2.3 ALLOCATION OF SECURITIES INCLUDED IN REGISTRATION STATEMENT
(a) If any requested registration pursuant to Section 2.1 involves an
underwritten offering and if the lead managing underwriter shall
advise the Corporation that, in its view, the number of Common
Shares requested to be included in such registration (including
those Common Shares requested by the Corporation to be included in
such registration) exceeds the largest number (the "SECTION 2.1
SALE NUMBER") that can be sold in an orderly manner in such
offering within a price range acceptable
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to the Initiating Holders, the Corporation shall include in such
registration:
(i) all Registrable Securities requested to be registered by
all Investors pursuant to Section 2.1; provided, however,
that, if the number of Registrable Securities requested to
be registered by all Investors pursuant to Section 2.1
exceeds the Section 2.1 Sale Number, then the number of
Registrable Securities requested by all Investors to be
registered pursuant to Section 2.1 which shall be included
in such registration shall be allocated on a pro rata
basis, based on the number of Registrable Securities owned
by each Investor requesting registration pursuant to
Section 2.1 in relation to the number of Registrable
Securities then owned by all Investors requesting
registration pursuant to Section 2.1;
(ii) to the extent that the number of Registrable Securities of
the Investors requested to be registered pursuant to
Section 2.1 is less than the Section 2.1 Sale Number, all
Registrable Securities requested to be registered by all
Holders (that are not Investors) pursuant to Section 2.1;
provided, however, that if the number of Registrable
Securities requested to be registered by all Holders (that
are not Investors) pursuant to Section 2.1 exceeds the
Section 2.1 Sale Number less the number of Registrable
Securities of the Investors requested to be registered,
then the number of Registrable Securities requested to be
registered by all Holders (that are not Investors) which
shall be included in such registration shall be allocated
on a pro rata basis, based on the number of Registrable
Securities owned by each Holder (that is not an Investor)
requesting registration pursuant to Section 2.1 in relation
to the number of Registrable Securities then owned by all
Holders (that are not Investors) requesting registration
pursuant to Section 2.1; and
(iii) to the extent that the number of Registrable Securities of
the Holders (including the Investors) requested to be
registered pursuant to Section 2.1 is less than the Section
2.1 Sale Number, all (or such lesser number sufficient to
aggregate the Section 2.1 Sale Number when added to the
number of Registrable Securities of the Holders (including
the Investors) requested to be registered pursuant to
Section 2.1) of the Registrable Securities requested to be
registered by Holdco pursuant to Section 2.1; and
(iv) to the extent that the number of Registrable Securities of
the Holders (including the Investors) and Holdco requested
to be registered pursuant to Section 2.1 is less than the
Section 2.1 Sale
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Number, all (or such lesser number sufficient to aggregate
the Section 2.1 Sale Number when added to the number of
Registrable Securities of the Holders (including the
Investors) and Holdco requested to be registered pursuant
to Section 2.1) of the Common Shares that the Corporation
proposes to register; and
(v) to the extent that the number of Registrable Securities
and/or Common Shares, as the case may be, of the Holders
(including the Investors), Holdco and the Corporation
requested to be registered pursuant to Section 2.1 is less
than the Section 2.1 Sale Number, all (or such lesser
number sufficient to aggregate the Section 2.1 Sale Number
when added to the number of Registrable Securities and/or
Common Shares, as the case may be, of the Holders
(including the Investors), Holdco and the Corporation
requested to be registered pursuant to Section 2.1) of the
Common Shares that a holder or holders of Additional
Piggyback Rights proposes to register.
If, as a result of the proration provisions of this Section 2.3(a), any
Holder or Holdco shall not be entitled to include all Registrable
Securities in a registration that such Holder or Holdco, as applicable,
has requested be registered, such Holder or Holdco, as applicable, may
elect to withdraw its request to include Registrable Securities in such
registration or may reduce the number requested to be included; provided,
however, that: (A) such request must be made in writing prior to the
execution of the underwriting agreement with respect to such
registration, and (B) such withdrawal shall be irrevocable and, after
making such withdrawal, such Holder or Holdco, as applicable, shall no
longer have any right to include Registrable Securities in the
registration as to which such withdrawal was made.
(b) If any registration pursuant to Section 2.2 involves an
underwritten offering and the lead managing underwriter shall
advise the Corporation that, in its view, the number of Common
Shares requested to be included in such registration exceeds the
number (the "SECTION 2.2 SALE NUMBER") that can be sold in an
orderly manner in such registration within a price range
acceptable to the Corporation, the Corporation shall include in
such registration:
(i) all Common Shares that the Corporation proposes to register
for its own account ("CORPORATION SECURITIES");
(ii) to the extent that the number of Corporation Securities is
less than the Section 2.2 Sale Number, all Registrable
Securities requested to be registered by all Investors
pursuant to Section 2.2 ("INVESTOR SECURITIES"); provided,
however, that, if the number of such
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Registrable Securities exceeds the Section 2.2 Sale Number
less the number of Corporation Securities, then the number
of Registrable Securities requested to be registered by all
Investors which shall be included in such registration
shall be allocated on a pro rata basis, based on the number
of Registrable Securities owned by each Investor requesting
registration pursuant to Section 2.2 in relation to the
number of Registrable Securities then owned by all
Investors requesting registration pursuant to Section 2.2;
and
(iii) to the extent the number of Corporation Securities and
Investor Securities is less than the Section 2.2 Sale
Number, all Registrable Securities requested to be
registered by all other Holders (that are not Investors)
pursuant to Section 2.2; provided however, if the number of
such Registrable Securities exceeds the Section 2.2 Sale
Number less the number of (A) Corporation Securities and
(B) Investor Securities, then the number of Registrable
Securities requested to be registered by all Holders (that
are not Investors) which shall be included in such
registration shall be allocated on a pro rata basis, based
on the number of Registrable Securities owned by each
Holder (that is not an Investor) requesting registration
pursuant to Section 2.2 in relation to the number of
Registrable Securities then owned by all Holders (that are
not Investors) requesting registration pursuant to Section
2.2; and
(iv) to the extent the number of Corporation Securities and
Registrable Securities requested to be registered by all
Holders pursuant to Section 2.2 is less than the Section
2.2 Sale Number, all (or such lesser number sufficient to
aggregate the Section 2.2 Sale Number when added to the
Corporation Securities and the number of Registrable
Securities of all Holders (including the Investors)
requested to be registered pursuant to Section 2.2) of the
Registrable Securities requested to be registered by Holdco
pursuant to Section 2.2; and
(v) to the extent that the number of Corporation Securities and
Registrable Securities requested to be registered by all
Holders and Holdco pursuant to Section 2.2 is less than the
Section 2.2 Sale Number, all (or such lesser number
sufficient to aggregate the Section 2.2 Sale Number when
added to the Corporation Securities and the number of
Registrable Securities of all Holders (including the
Investors) and Holdco requested to be registered pursuant
to Section 2.2) of the Common Shares requested to be
registered by holders of Additional Piggyback Rights.
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SECTION 2.4 REGISTRATION PROCEDURES
If and whenever the Corporation is required by the provisions of this
Agreement to use its reasonable best efforts to effect or cause the registration
of any Registrable Securities under the applicable Securities Laws determined in
the manner contemplated by this Agreement, the Corporation shall, as soon as
reasonably possible:
(a) prepare and file with the Commission or Canadian securities
regulatory authorities a registration statement on an appropriate
registration form of the Commission or Canadian securities
regulatory authorities for the disposition of such Registrable
Securities in accordance with the intended method of disposition
thereof, which form shall, in the case of a shelf registration, be
available for the sale of the Registrable Securities by the
Holders or Holdco and such registration statement shall comply in
all material respects with the requirements of the applicable form
and include all financial statements required by the Commission or
Canadian securities regulatory authorities to be filed therewith,
and the Corporation shall use its reasonable best efforts to cause
such registration statement to become and, subject to 2.4(b),
remain effective (provided, however, that before filing a
registration statement or any amendments or supplements thereto,
or comparable statements under securities or "blue sky" laws of
any United States jurisdiction, the Corporation will furnish to
counsel (in the case of a registration pursuant to Section 2.1,
selected by the Initiating Holders and, in the case of a
registration pursuant to Section 2.2, selected by the Person
(being a Holder or Holdco), that, together with its Affiliates,
includes the largest number of Registrable Securities in such
registration (the "MAJOR HOLDER")) and the underwriters, if any,
copies of all such documents proposed to be filed (including all
exhibits thereto), which documents will be subject to the
reasonable review and reasonable comment of such counsel and the
underwriter, if any, and the Corporation shall not file any
registration statement or amendment thereto or any supplement
thereto to which the Initiating Holders, in the case of a Demand
Registration Request, the Major Holder in the case of a
registration pursuant to Section 2.2, or the underwriters, if any,
shall reasonably object in writing);
(b) prepare and file with the Commission or Canadian securities
regulatory authorities such amendments and supplements to such
registration statement (including the prospectus contained
therein) as may be necessary to keep such registration statement
effective for such period (which shall not be required to exceed
120 days in the case of a registration pursuant to Section 2.1 or
90 days in the case of a registration pursuant to Section 2.2) as
any seller of Registrable Securities pursuant to such registration
statement may reasonably request and to comply with the provisions
of the Securities Laws with respect to the sale or other
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disposition of all Registrable Securities covered by such
registration statement in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such
registration statement;
(c) furnish, without charge, to each seller of such Registrable
Securities and each underwriter, if any, of the securities covered
by such registration statement such number of copies of such
registration statement, each amendment and supplement thereto (in
each case including all exhibits and including any preliminary
prospectus) included in or constituting such registration
statement in conformity with the requirements of the applicable
Securities Laws, and other documents, as such seller and the lead
managing underwriter may reasonably request in order to facilitate
the public sale or other disposition of the Registrable Securities
owned by such seller (the Corporation hereby consenting to the use
in accordance with all applicable laws of each such registration
statement (or amendment or post-effective amendment thereto) by
each such seller of Registrable Securities and the underwriters,
if any, in connection with the offering and sale of the
Registrable Securities covered by such registration statement);
(d) use its reasonable best efforts to register or qualify the
Registrable Securities covered by such registration statement
under such other securities or "blue sky" laws of such
jurisdictions as any sellers of Registrable Securities or any lead
managing underwriter, if any, shall reasonably request, and do any
and all other acts and things which may be reasonably necessary or
advisable to enable such sellers or the underwriters, if any, to
consummate the disposition of the Registrable Securities in such
jurisdictions, except that in no event shall the Corporation be
required to qualify to do business as a foreign corporation in any
jurisdiction where it would not, but for the requirements of this
paragraph (d), be required to be so qualified, to subject itself
to taxation in any such jurisdiction, to consent to general
service of process in any such jurisdiction or to qualify the
Registrable Securities under U.S. Securities Law unless the Common
Shares are listed and trading on a stock exchange in the United
States;
(e) promptly notify each seller of Registrable Securities covered by
such registration statement and each lead managing underwriter, if
any:
(i) when the registration statement, any pre-effective
amendment, the prospectus or any prospectus supplement
included therein or post-effective amendment to the
registration statement has been filed and, with respect to
the registration statement or any post-effective amendment,
when the same has become effective;
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(ii) of any request by the Commission, any United States state
securities authority or any Canadian securities regulatory
authority for amendments or supplements to the registration
statement or the prospectus included therein or for
additional information;
(iii) of the issuance by the Commission or any Canadian
securities regulatory authority of any stop order
suspending the effectiveness of the registration statement
or the initiation of any proceedings for that purpose;
(iv) of the receipt by the Corporation of any notification with
respect to the suspension of the qualification of any
Registrable Securities for sale under the securities or
"blue sky" laws of any jurisdiction or the initiation of
any proceeding for such purpose;
(v) of the existence of any fact of which the Corporation
becomes aware which results in the registration statement,
the prospectus included therein, if any, or any document
incorporated therein by reference containing an untrue
statement of a material fact or omitting to state a
material fact required to be stated therein, or necessary
to make any statement therein not misleading or not
misleading in light of the circumstances in which it is
made; and
(vi) if at any time the representations and warranties
contemplated by any underwriting agreement, securities
sales agreement, or other similar agreement relating to the
offering shall cease to be true and correct in all material
respects;
(f) if the notification relates to an event described in clause (v),
the Corporation shall promptly prepare and furnish to any seller
of Registrable Securities and each underwriter, if any, a
reasonable number of copies of a registration statement
supplemented or amended so that, as thereafter delivered to the
purchasers of such Registrable Securities, such registration
statement shall not include an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or not
misleading in light of the circumstances in which they are made;
(g) use its reasonable best efforts (including the payment of any
listing fees) to obtain the listing of all Registrable Securities
covered by such registration statement on each securities exchange
on which securities of the same class are then listed, if the
listing of such Registrable Securities is then permitted or is
required under the rules of such exchange;
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(h) provide and cause to be maintained a transfer agent and registrar
for all such Registrable Securities covered by such registration
statement not later than the effective date of such registration
statement;
(i) enter into such customary agreements (including, if applicable, an
underwriting agreement) and take such other actions as the Major
Holder (or the Initiating Holders in the case of a Section 2.1
Demand Registration) shall reasonably request in order to expedite
or facilitate the disposition of such Registrable Securities;
(j) obtain an opinion from the Corporation's counsel and a "cold
comfort" letter from the Corporation's independent public
accountants in customary form and covering such matters as are
customarily covered by such opinions and "cold comfort" letters
delivered to underwriters in underwritten public offerings, which
opinion and letter shall be reasonably satisfactory to the
underwriters, if any, and to the Major Holder (or the Initiating
Holders in the case of a Section 2.1 Demand Registration)
participating in such offering and furnish to each Holder and/or
Holdco (if participating in the offering) and to each underwriter,
if any, a copy of such opinion and letter addressed to each such
Holder and/or Holdco and underwriter, if any;
(k) use its reasonable best efforts to obtain the withdrawal of any
order suspending the effectiveness of the registration statement;
(l) provide a CUSIP number for all Registrable Securities, not later
than the effective date of the registration statement, if
requested;
(m) make reasonably available its employees and personnel and
otherwise provide reasonable assistance to the underwriters in the
marketing of Registrable Securities in any underwritten offering;
provided however, that, the Corporation shall not be required to
have employees attend or conduct any road shows (which for greater
certainty will not include conference calls or video conferencing)
with respect to any Demand Registration pursuant to Section 2.1
hereof more than one time in any 12 month period, unless the
Corporation is otherwise selling Common Shares under such
registration statement and is otherwise conducting road shows;
provided however, that the Corporation shall require such
employees and personnel to attend and conduct a road show (which
for greater certainty, shall be in addition to the road show
described above and conducted pursuant to Section 2.1 once during
any 12 month period), including conference calls or video
conferencing, in respect of an underwritten public offering
pursuant to Section 3.12 hereof, at any time prior to July 31,
2001;
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(n) cooperate with the sellers of Registrable Securities and the
managing lead underwriter, if any, to facilitate the timely
preparation and delivery of certificates not bearing any
restrictive legends representing the Registrable Securities to be
sold, and cause such Registrable Securities to be issued in such
denominations and registered in such names in accordance with the
underwriting agreement prior to any sale of Registrable Securities
to the underwriters or, if not an underwritten offering, in
accordance with the instructions of the sellers of Registrable
Securities at least three business days prior to any sale of
Registrable Securities;
(o) if a Canadian Prospectus is filed in the Province of Quebec,
obtain opinions of Quebec counsel and of the auditors representing
the Corporation for the purposes of such registration relating to
translation into the French language of the applicable
registration statement, in form and substance as is customarily
given to underwriters in an underwritten public offering and
reasonably satisfactory to the underwriter, if any, and to the
Major Holder (or the Initiating Holders, in the case of a Section
2.1 Demand Registration) participating in such offering and
furnish to each Holder and/or Holdco (if participating in the
offering) and to such underwriters, if any, a copy of such
opinion, addressed to the underwriter, if any, and to each such
Holder and/or Holdco; and
(p) take all such other commercially reasonable actions as are
necessary or advisable in order to expedite or facilitate the
distribution of such Registrable Securities.
The Corporation may require as a condition precedent to the Corporation's
obligations under this Section 2.4 that each seller of Registrable
Securities as to which any registration is being effected furnish the
Corporation such information regarding such seller and the distribution
of such securities as the Corporation may from time to time reasonably
request, provided that such information shall be used only in connection
with such registration. If any Holder or Holdco, as applicable, fails to
provide the Corporation with such information within 15 days of the
Corporation's request, the Corporation's obligations under Section 2.1
and Section 2.2 hereof with respect to such Holder or Holdco, as
applicable, or the Registrable Securities owned by such Holder or Holdco,
as applicable, as to which the registration is being effected, shall be
suspended until such Holder or Holdco, provides such information.
Each Holder and Holdco agrees that upon receipt of any notice from the
Corporation of the happening of any event of the kind described in
Section 2.4(e)(v), each such Holder and Holdco, as applicable, will
discontinue such Holder's or Holdco's, as applicable, disposition of
Registrable Securities pursuant to the registration statement covering
such Registrable Securities until such Holder's or Holdco's, as
applicable, receipt of the copies of the registration
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statement contemplated by Section 2.4(f) and, if so directed by the
Corporation, will deliver to the Corporation all copies, other than
permanent file copies, then in such Holder's or Holdco's, as applicable,
possession of the registration statement covering such Registrable
Securities that was in effect at the time of receipt of such notice. In
the event the Corporation shall give any such notice, the applicable
period mentioned in Section 2.4(b) shall be extended by the number of
days during such period from and including the date of the giving of such
notice to and including the date when each seller of any Registrable
Securities covered by such registration statement shall have received the
copies of the registration statement contemplated by Section 2.4(f).
If any such registration statement or comparable statement under "blue
sky" laws refers to any Holder or Holdco by name or otherwise as the
holder of any Registrable Securities of the Corporation, then such Holder
or Holdco, as applicable, shall have the right to require:
(i) the insertion therein of language, in form and substance
satisfactory to such Holder or Holdco, as applicable,
acting reasonably, to the effect that the holding by such
Holder or Holdco, as applicable, of such securities is not
to be construed as a recommendation by such Holder or
Holdco, as applicable, of the investment quality of the
Corporation's securities covered thereby and that such
holding does not imply that such Holder or Holdco, as
applicable, will assist in meeting any future financial
requirements of the Corporation; or
(ii) in the event that such reference to such Holder or Holdco,
as applicable, by name or otherwise is not in the judgement
of the Corporation, as advised by counsel, required by
applicable Securities Laws or any similar federal statute
or any state "blue sky" or United States or Canadian
securities law then in force, the deletion of the reference
to such Holder or Holdco, as applicable.
SECTION 2.5 REGISTRATION EXPENSES
(a) "EXPENSES" shall mean any and all fees and expenses incident to
the Corporation's performance of or compliance with this Article
2, including, without limitation:
(i) Commission, Canadian securities regulatory authorities,
United States or Canadian stock exchange registration
listing and filing fees;
(ii) fees and expenses of compliance with Securities Laws or
United States "blue sky" laws and in connection with the
preparation of a
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"blue sky" survey, including, without limitation,
reasonable fees and expenses of blue sky counsel;
(iii) printing and copying expenses;
(iv) messenger and delivery expenses;
(v) expenses incurred by the Corporation and any underwriter(s)
in connection with any road show;
(vi) fees and disbursements of counsel for the Corporation;
(vii) fees and disbursements of all independent public
accountants (including the expenses of any audit and/or
"cold comfort" letter) and fees and expenses of other
Persons, including special experts, retained by the
Corporation; and
(viii) subject to clause (d)(ii) below, any other fees and
disbursements of underwriters, if any, customarily paid by
issuers or sellers of securities.
(b) Subject to Section 2.5(c), the Corporation shall pay all Expenses
with respect to any Demand Registration pursuant to Section 2.1
(which for greater certainty shall include the Expenses associated
with a withdrawal of a Demand Registration by an Investor or
Holdco, as the case may be, pursuant to Section 2.1(d) which
results in the Corporation abandoning the registration pursuant to
Section 2.1(e)(i) hereof) whether or not such Demand Registration
becomes effective or does not remain effective for the period
contemplated by Section 2.4(b). Subject to Section 2.5(c), the
Corporation shall pay all Expenses of each Investor and Holdco
with respect to any registration effected under Section 2.2. Each
Holder (other than the Investors) shall pay the expenses
attributable to that Holder with respect to any registration
effected pursuant to Section 2.2 (such expenses shall be allocated
amongst the Holders (other than the Investors) on a pro rata basis
based on the number of Registrable Securities included in such
offering by each Holder (that is not an Investor) relative to the
number of Common Shares included in such offering, except to the
extent Expenses are specifically attributable to a Holder (other
than an Investor) or to Registrable Securities included in an
offering by a Holder (other than an Investor)).
(c) Each Holder and Holdco participating in a registration pursuant to
Section 2.1 and each Investor and Holdco participating in a
registration pursuant Section 2.2, shall pay the fees and expenses
payable by the Corporation pursuant to Sections 2.5(a)(i) and (ii)
above that are
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calculated on a "per security" basis, which fees and expenses
shall be allocated between each Holder and Holdco in a
registration pursuant to Section 2.1 and between each Investor and
Holdco in a registartion pursuant to Section 2.2 on a pro rata
basis based on the number of Registrable Securities included in
such offering by each party relative to the number of Common
Shares included in such offering; provided that, if the
Corporation or any other Person sells any Shares pursuant to a
registration under Section 2.1 or Section 2.2, then the Holders
and Holdco participating in a registration under Section 2.1, and
the Investors and Holdco participating in a registration under
Section 2.2 shall not be responsible for that portion of the fees
and expenses payable under Sections 2.5(a)(i) and (ii) that are
attributable to the Corporation or such Person or Persons as a
result of participating in such offering or offerings.
(d) Notwithstanding the foregoing:
(i) the provisions of this Section 2.5 shall be deemed amended
to the extent necessary to cause these expense provisions
to comply with United States "blue sky" laws of each state
or the securities laws of any other jurisdiction in which
the offering is made as contemplated herein;
(ii) in connection with any registration hereunder, each Holder
and Holdco shall pay all underwriting discounts and
commissions and any transfer taxes, if any, attributable to
such Holder's or Holdco's, Registrable Securities sold in
the offering;
(iii) the Corporation shall be responsible for all of its
internal expenses (including, without limitation, all
salaries and expenses of its officers and employees
performing legal or accounting duties);
(iv) each Holder and Holdco shall pay the fees and expenses of
its own counsel pursuant to a registration under Section
2.2. In the case of a registration pursuant to Section 2.1,
the Corporation shall pay the reasonable fees and expenses
of one special counsel for the Holders and/or Holdco in
each applicable country or province, which special counsel
shall be designated by the Initiating Holders, and subject
to the approval of the Corporation, in an amount not to
exceed US$35,000 per registration pursuant to Section 2.1
and an aggregate of US$l50,000 for all registrations under
Section 2.1.
SECTION 2.6 CERTAIN LIMITATIONS ON REGISTRATION RIGHTS
In the case of any registration under Section 2.1 pursuant to an
underwritten offering, or in the case of a registration under Section 2.2 if the
Corporation has determined to enter into an underwriting agreement in connection
therewith, all
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securities to be included in such registration shall be subject to an
underwriting agreement and no Person may participate in such registration unless
such Person agrees to sell such Person's securities on the basis provided
therein and completes and/or executes all questionnaires and other documents
which must be executed in connection therewith, and provides such other
information to the Corporation or the underwriter as may be necessary to
register such Person's securities; provided that the Corporation and, in the
case of a Demand Registration pursuant to Section 2.1, the Initiating Holders,
first advises with such Holder and/or Holdco, if applicable requesting
Registrable Securities to be included in such registration as to the terms and
conditions of such underwriting agreement. The Corporation shall be entitled to
select the underwriters for all such offerings; provided that in the case of a
Demand Registration, the Initiating Holders shall be entitled to select the
underwriters with the approval of the Corporation, not to be unreasonably
withheld.
SECTION 2.7 LIMITATIONS ON SALE OR DISTRIBUTION OF OTHER SECURITIES.
If requested in writing by the Corporation or the lead managing
underwriter, if any, of any registration effected pursuant to Section 2.1 or
Section 2.2, each Holder and Holdco agrees not to effect any public sale or
distribution, including any sale pursuant to Canadian Securities Laws or Rule
144 under the U.S. Securities Act, of any Registrable Securities, or of any
other security convertible into or exchangeable or exercisable for any
Registrable Securities (other than as part of such underwritten public offering)
during the time period reasonably requested by the Corporation or the lead
managing underwriter, if any, not to exceed 180 days (and the Corporation hereby
also agrees to cause each holder of 10% or more of the Common Shares or of any
security convertible into or exchangeable or exercisable for 10% or more of the
Common Shares in respect of which the Corporation then has the power to request
or impose such a restriction to agree to an identical restriction on sale or
distribution of any of their Common Shares or securities convertible or
exchangeable or exercisable for Common Shares).
SECTION 2.8 NO REQUIRED SALE
Nothing in this Agreement shall be deemed to create an independent
obligation on the part of any Holder or Holdco to sell any Registrable
Securities pursuant to any effective registration statement.
SECTION 2.9 INDEMNIFICATION
(a) In connection with any registration statement, the Corporation
shall indemnify and hold harmless each Holder and Holdco which has
elected to exercise its registration rights under Section 2.1 or
Section 2.2 hereof ("EXERCISING Person") and each of its
respective directors and officers and each person controlling such
Exercising Person within the meaning of Section 15 of the U. S.
Securities Act from and against any loss, liability, claim, damage
and expense whatsoever, including any amounts paid in settlement
of any investigation, litigation, proceeding or claim, joint or
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several, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
registration statement (or any amendment or supplement thereto)
covering Registrable Securities, including all documents
incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading
or not misleading in the light of the circumstances under which
they were made; provided, that, the Corporation shall not be
liable under this clause (a) for any settlement of any action
effected without its written consent, which consent shall not be
unreasonably withheld or delayed; provided, further, that the
indemnity provided for in this Section 2.9(a) shall not apply to
any loss, liability, claim, damage or expense to the extent
arising out of an untrue statement or omission or alleged untrue
statement or omission (i) made in reliance upon and in conformity
with written information furnished to the Corporation by such
Exercising Person in writing expressly stating that such
information is being provided by such Exercising Person for use in
the registration statement (or any amendment thereto) or any
prospectus (or any amendment or supplement thereto) included
therein or (ii) contained in any registration statement if such
Exercising Person failed to send or deliver a copy of the
registration statement (or any amendment or supplement thereto) to
the Person asserting such losses, claims, damages or liabilities
on or prior to the delivery of written confirmation of any sale of
securities covered thereby to such Person in any case where such
registration statement (or any amendment or supplement thereto)
corrected such untrue statement or omission. Any amounts advanced
by the Corporation to an indemnified party pursuant to this
Section 2.9 as a result of such losses shall be returned to the
Corporation if it shall be finally determined by such a court in a
judgement not subject to appeal or final review that such
indemnified party was not entitled to indemnification by the
Corporation.
(b) Each Exercising Person, severally and not jointly, shall indemnify
and hold harmless the Corporation and the other Exercising Persons
and each of their respective directors and officers (including
each officer and director (if applicable) of the Corporation who
signed the registration statement) and each Person, if any, who
controls the Corporation or any other Exercising Person within the
meaning of Section 15 of the U. S. Securities Act, from and
against any loss, liability, claim, damage and expense whatsoever
described in the indemnity contained in Section 2.9(a) hereof, as
incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the
registration statement (or any amendment thereto) or any
prospectus (or any amendment or supplement thereto) included
therein in reliance upon and in conformity with written
information furnished to the Corporation
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by such Exercising Person in writing expressly stating that such
information is being provided by such Holder for use in the
registration statement (or any amendment thereto) or any
prospectus (or any amendment or supplement thereto) included
therein provided, that the Exercising Person shall not be liable
under this clause for any settlement of any action effected
without its written consent, which consent shall not be
unreasonably withheld.
(c) Each party entitled to indemnification under this Section 2.9 (the
"INDEMNIFIED PARTY") shall give notice to the party required to
provide indemnification (the "INDEMNIFYING PARTY") promptly after
such Indemnified Party has actual knowledge of any claim as to
which indemnity may be sought, but the omission to so notify the
Indemnifying Party shall not relieve it from any liability which
it may have to the Indemnified Party pursuant to the provisions of
this Section 2.9 except to the extent of the actual damages
suffered by such delay in notification. The Indemnifying Party
shall assume the defence of such action, including the employment
of counsel to be chosen by the Indemnifying Party to be reasonably
satisfactory to the Indemnified Party, and payment of expenses.
The Indemnified Party shall have the right to employ its own
counsel in any such case, but the legal fees and expenses of such
counsel shall be at the expense of the Indemnified Party, unless
the employment of such counsel shall have been authorized in
writing by the Indemnifying Party in connection with the defence
of such action, or the Indemnifying Party shall not have employed
counsel to take charge of the defence of such action within a
reasonable time after notice thereof or the Indemnified Party
shall have reasonably concluded that there may be defences
available to it or them which are different from or additional to
those available to the Indemnifying Party (in which case the
Indemnifying Party shall not have the right to direct the defence
of such action on behalf of the Indemnified Party), in any of
which events such fees and expenses shall be borne by the
Indemnifying Party. No Indemnifying Party, in the defence of any
such claim or litigation, shall, except with the consent of each
Indemnified Party, consent to entry of any judgement or enter into
any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to
such claim or litigation.
(d) If the indemnification provided for in this Section 2.9 is
unavailable to a party that would have been an Indemnified Party
under this Section 2.9 in respect of any expenses, claims, losses,
damages and liabilities referred to herein, then each party that
would have been an Indemnifying Party hereunder shall, in lieu of
indemnifying such Indemnified Party, contribute to the amount paid
or payable by such Indemnified Party as a
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result of such expenses, claims, losses, damages and liabilities
in such proportion as is appropriate to reflect the relative fault
of the Indemnifying Party on the one hand and such Indemnified
Party on the other in connection with the statement or omission
which resulted in such expenses, claims, losses, damages and
liabilities, as well as any other relevant equitable
considerations. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied
by the Indemnifying Party or such Indemnified Party and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
Corporation and each Exercising Person agrees that it would not be
just and equitable if contribution pursuant to this Section were
determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable
considerations referred to above in this Section 2.9(d).
(e) No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the U.S. Securities Act) shall be
entitled to contribution from any Person who was not guilty of
such fraudulent misrepresentation.
(f) Notwithstanding any provision of this Agreement or any other
agreement, in no event will any Exercising Person be liable for
indemnification hereunder for an amount greater than the amount of
proceeds that such Exercising Person received in any particular
offering of Common Shares in which its Registrable Securities were
sold.
ARTICLE 3
GENERAL
SECTION 3.1 RULE 144
If the Corporation shall have filed a registration statement pursuant to
the requirements of Section 12 of the U.S. Exchange Act or a registration
statement pursuant to the requirements of the U.S. Securities Act in respect of
the Common Shares or securities of the Corporation convertible into or
exchangeable or exercisable for Common Shares, the Corporation covenants that:
(a) so long as it remains subject to the reporting provisions of the
U.S. Exchange Act, it will timely file the reports required to be
filed by it under the U.S. Securities Act or the U.S. Exchange Act
(including, without limitation, the reports under Sections 13 and
15(d) of the U.S. Exchange Act referred to in subparagraph (c)(l)
of Rule 144 under the U.S. Securities Act); and
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(b) to the extent required from time to time to enable such Holder to
sell Registrable Securities without registration under the U.S.
Securities Act within the limitation of the exemptions provided by
(a) Rule 144 under the U.S. Securities Act, as such Rule may be
amended from time to time, or (b) any similar rule or regulation
hereafter adopted by the Commission. Upon the request of any
Holder or Holdco, the Corporation will deliver to such Holder or
Holdco, as applicable, a written statement as to whether it has
complied with such requirements.
SECTION 3.2 NOMINEES FOR BENEFICIAL OWNERS
If Registrable Securities are held by a nominee for the beneficial owner
thereof, the beneficial owner thereof may, at its option, be treated as the
holder of such Registrable Securities for purposes of any request or other
action by any holder or holders of Registrable Securities pursuant to this
Agreement (or any determination of any number or percentage of Common Shares
constituting Registrable Securities held by any holder or holders of Registrable
Securities contemplated by this Agreement); provided, however, that the
Corporation shall have received written assurances reasonably satisfactory to it
of such beneficial ownership.
SECTION 3.3 AMENDMENTS
The terms and provisions of this Agreement may be modified or amended, or
any of the provisions hereof waived, temporarily or permanently, pursuant to the
prior written consent of the Corporation and the party adversely affected by
such modification or waiver.
SECTION 3.4 NOTICES
All notices, requests, consents and other communications hereunder to any
party shall be deemed to be sufficient if contained in a written instrument
delivered in person or sent by telecopy, nationally recognized overnight courier
or first class registered or certified mail, return receipt requested, postage
prepaid, addressed to such party at the address set forth below or such other
address as may hereafter be designated in writing by such party to the other
parties:
(a) if to the CAI Entities, to:
c/o CAI Managers & Co., L. P.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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with a copy to (which shall not constitute notice for the purposes
of this Agreement):
Stikeman Elliott
Commerce Court West
Suite 5300, 199 Bay Street
Toronto, ON M5L lB9
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(b) if to B.C., to:
Xxxxxxx Xxxxxx
c/o McCullough O'Xxxxxx Xxxxx
0000-000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX X0X 0X0
Attention: Xxxxxxxx XxXxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(c) if to the Institutional Investor, to:
0000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
Attention: Xxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to (which shall not constitute notice for the purposes
of this Agreement):
Goodmans
Xxxxx 0000
000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attention: Xxxxxxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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(d) if to Holdco, to:
c/o 00000 Xxxxxxxx Xxxxxxxxx
Xxxxxx, Xxxxxxxx
00000
Attention: Legal Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to (which shall not constitute notice for the purposes
of this Agreement):
Xxxxx & Xxxxxxx, L.L.P.
000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, X.X.
00000 - 1109
Attention: Xxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(e) if to the Corporation, to:
00000 Xxxxxxxx Xxxxxxx
Xxxxxxxx, XX X0X 253
Attention: Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (604) 278-l837
with a copy to (which shall not constitute notice for the purposes
of this Agreement):
Xxxxxx Xxxxxxx Xxxxx & Xxxxxx
P. O. Xxx 00000
Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Dominion Bank Tower
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, X.X. X0X lB3
Attention: Xxxxxxxxx Xxxxxxxx, Esq.
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Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Each party, by written notice given to the Corporation in accordance with this
Section 3.4, may change the address to which such notice or other communications
are to be sent to such party. All such notices, requests, consents and other
communications shall be deemed to have been given when received.
SECTION 3.5 REGISTRATION RIGHTS OF ORBITAL
Subject to Section 3.8:
(a) For good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged by each of Orbital, the
Corporation, the CAI Entities and B.C., Orbital, the Corporation,
the CAI Entities and B.C. covenant and agree that the registration
rights granted to Orbital pursuant to the Registration Rights
Agreement in respect of its Registrable Securities as defined in
the Registration Rights Agreement are cancelled and terminated as
and from the date of this Agreement and all the provisions of the
Registration Rights Agreement as they relate to Orbital are hereby
declared to be null and void and of no further force and effect.
(b) Orbital and the Corporation hereby release each other, their
successors and assigns and the CAI Entities and B.C. from any
claims or demands arising under or pursuant to the Registration
Rights Agreement as it relates to the rights granted to Orbital.
(c) Orbital acknowledges that the registration rights previously
granted to it under the Registration Rights Agreement have been in
effect granted to Holdco pursuant to this Agreement.
SECTION 3.6 SUBORDINATION OF REGISTRATION RIGHTS OF HOLDCO
Holdco's registration rights in respect of the Corporation set forth in
this Agreement shall in all respects be subordinate to the rights of the Holders
herein.
SECTION 3.7 CERTAIN COVENANTS OF ORBITAL AND HOLDCO IN FAVOUR OF THE CAI
ENTITIES AND B.C.
The CAI Entities, B.C., Orbital and Holdco covenant and agree as follows:
(a) For so long as (i) the CAI Entities and B.C. collectively own the
lesser of (a) at least 10% of the outstanding Common Shares, and
(b) Common Shares representing at least U.S.$25 million based on
their Issue Price, and (ii) Orbital Controls Holdco, Holdco shall
not at any time incur or guarantee any indebtedness for borrowed
money (including borrowings represented by a note, bond, debenture
or other evidence of indebtedness) or other obligations, or
pledge, grant security over or otherwise encumber
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any of its assets, or dispose of any of its assets except for
transfers of Common Shares in accordance with the Amended and
Restated Option Agreement, without the consent of the CAI Entities
and B.C.
(b) For so long as (i) the CAI Entities and B.C. collectively own the
lesser of (a) at least 10% of the outstanding Common Shares, and
(b) Common Shares representing at least U.S.$25 million based on
their Issue Price, and (ii) Orbital Controls Holdco, Holdco shall
not, without the consent of the CAI Entities and B.C., amend its
articles (except immaterial amendments) or be the subject of any
reorganization, continuance, amalgamation, arrangement, merger,
winding-up, liquidation or dissolution.
(c) Orbital will at all times, for so long as Orbital Controls Holdco,
ensure that any security existing with respect to any shares of
Holdco held by Orbital shall comply with the following: Orbital
shall be entitled to pledge any or all of its shares of Holdco to
a bona fide arm's length lender or lenders (the "LENDER") of
Orbital from time to time as security for indebtedness of Orbital
owed to such Lender provided that such Lender acknowledges in
writing to the CAI Entities, B.C. and Holdco that (i) until a
default under the pledge, the pledged shares shall continue to be
registered in the name of Orbital and Orbital shall be entitled to
exercise all rights in respect thereof (including voting rights
and director nomination rights), and (ii) if the Lender commences
enforcement proceedings or otherwise realizes on the pledged
shares following default, the Lender shall immediately notify the
CAI Entities, B.C. and Holdco and its interest in the pledged
shares shall be subject to the provisions of this Section
applicable thereto, as and to the same extent as though the Lender
were Orbital.
(d) Orbital will at all times, for so long as Orbital Controls Holdco,
ensure that Holdco, if applicable, and the Corporation and its
subsidiaries shall operate consistent with the following: Orbital
shall ensure that Holdco complies with the Amended and Restated
Option Agreement and, for so long as the CAI Entities and B.C.
hold at least 10% of the outstanding Common Shares or Common
Shares representing at least U.S.$25 million based on their Issue
Price, Orbital shall ensure that Holdco complies with its charter
documents (which shall continue to have limitations satisfactory
to the CAI Entities and B.C., acting reasonably, on its activities
to ensure its separateness and independence).
(e) The provisions of this Section 3.7 shall terminate two years from
the date hereof.
SECTION 3.8 EFFECTIVENESS OF CERTAIN AGREEMENTS
The Registration Rights Agreement is terminated, amended, restated,
replaced and superseded by this Agreement effective immediately.
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SECTION 3.9 PERMITTED TRANSFEREES OF THE CAI ENTITIES
Each Person or Persons holding Registrable Securities as a result of a
transfer or assignment by the CAI Entities contemplated by Section 2.3 of the
Resale Restrictions Agreement, shall be deemed collectively for the purposes of
this Agreement a CAI Entity and such investors shall agree to act for the
purposes of this Agreement through one of the CAI Entities or their general
partners for the earlier of the term of this Agreement and 12 months following
the Closing Date, and shall not, for greater certainty, exercise a Demand
Registration pursuant to Section 2.1 without the prior consent of one of the CAI
Entities or their general partners.
SECTION 3.10 CAI
The parties to this Agreement (including any other Person or Persons that
become bound by the terms of this Agreement) agree that the CAI Entities shall
be treated collectively for purposes of the computations found in Sections
3.7(a), (b) and (d) and shall be deemed to be Affiliates for the purposes
hereof.
SECTION 3.11 HOLDERS
This Agreement shall cease to apply to a Holder (that is a transferee
pursuant to Section 2.2(2) or Sections 3.13(1) or (2) of the Resale Restrictions
Agreement as in effect on the date hereof) following June 30, 2002.
SECTION 3.12 REMAINING SHARES
(1) Notwithstanding anything to the contrary contained in this Agreement,
(a) if the CAI Entities or B.C., as the case may be (each an
"EXERCISING OPTIONHOLDER"), exercises its right under Section 5(b)
of the Amended and Restated Option Agreement to require Holdco to
sell the Remaining Shares pursuant to an underwritten public
offering at any time prior to the Termination Date (as defined in
the Amended and Restated Option Agreement), then Holdco shall
promptly thereafter exercise a Demand Registration pursuant to
Section 2.1 of the Amended and Restated Registration Rights
Agreement to sell, by way of an underwritten public offering, any
or all of the Remaining Shares and the Exercising Optionholder
shall be entitled to (i) select the underwriter(s) for such public
offering; and (ii) exercise the decision-making powers of Holdco
in respect of such Demand Registration as if it was Holdco
(notwithstanding that the Demand Registration is being exercised
by Holdco), and the Exercising Optionholder shall be treated in
all other respects as the Initiating Holder for the purposes of
such offering; and
(b) none of the Holders (other than the Exercising Optionholder),
Holdco, the Corporation or the holders of Additional Piggyback
Rights shall be entitled to participate in the Demand Registration
and/or underwritten
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public offering without the prior written consent of the
Exercising Optionholder, in its sole discretion; and
(c) for greater certainty, Section 2.3(a) and Section 2.1(b) shall not
apply in such circumstances.
(2) The Corporation, Holdco and Orbital agree to cooperate in full with the
Exercising Optionholder, in connection with the sale of the Remaining
Shares pursuant to an underwritten public offering, including without
limitation, participating in the prospectus process, assisting with
access for due diligence purposes, and signing any requested underwriting
or indemnification agreements on terms not materially more adverse to
them than those applicable in the Corporation's initial public offering.
(3) The exercise by Holdco of a Demand Registration in accordance with
Section 2.1(1) shall count as one of Holdco's Demand Registrations
pursuant to Section 2.1(e)(iv) of this Agreement.
SECTION 3.13 BOARD APPROVAL
The terms and conditions of this Agreement shall not take effect until
ratified, confirmed and approved by the board of directors of the Corporation
(it being understood that all members of the board of directors of the
Corporation shall be entitled, notwithstanding their interest, to vote thereon
given the immateriality of this Agreement).
SECTION 3.14 MISCELLANEOUS
(a) This Agreement shall be binding upon and enure to the benefit of
and be enforceable by the parties hereto and the respective
successors, personal representatives and permitted assigns of the
parties hereto, whether so expressed or not, provided that, for
greater certainty, no Person other than a Holder or Holdco shall
be entitled to any benefits under this Agreement, except as
otherwise expressly provided herein. This Agreement and the rights
of the parties hereunder may be assigned in whole by any of the
parties hereto to any transferee (other than a Holder) of
Registrable Securities with the consent of the Corporation, which
consent shall not be unreasonably withheld, provided that upon the
consummation of, and as a condition to, any such assignment the
transferee assumes the obligations of the assignor under, and
agrees to be bound by the terms of this Agreement.
(b) This Agreement and the other writings referred to herein or
delivered pursuant hereto which form a part hereof contain the
entire agreement among the parties with respect to the subject
matter hereof and supersede all prior and contemplated
arrangements and understandings with respect thereto, including
but not limited to, Schedule "F" of the
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Subscription Agreement dated as of June 29, 2000, as amended among
CAI Capital Partners and Company II, L.P., CAI Partners and
Company II, L.P., CAI Capital Partners and Company II-C, L.P.,
597858 B.C. LTD., Orbital Sciences Corporation, XxxXxxxxx,
Xxxxxxxxx Holdings Inc. and XxxXxxxxx, Xxxxxxxxx and Associates
Ltd.
(c) This Agreement shall be governed by and construed in accordance
with the laws of the Province of British Columbia without giving
effect to the principles of conflicts of law thereof.
(d) The headings of the sections of this Agreement have been inserted
for convenience of reference only and shall not be deemed to be a
part of this Agreement.
(e) This Agreement may be executed in any number of counterparts, and
each such counterpart hereof shall be deemed an original
instrument, but all such counterparts together shall constitute
but one instrument.
(f) Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid, but if
any provision of this Agreement is held to be invalid or
unenforceable in any respect, such invalidity or unenforceability
shall not render invalid or unenforceable any other provision of
this Agreement.
(g) It is hereby agreed and acknowledged that it will be impossible to
measure in money the damages that would be suffered if the parties
fail to comply with any of the obligations herein imposed on them
and that in the event of any such failure, an aggrieved Person
will be irreparably damaged and will not have an adequate remedy
at law. Any such Person, therefore, shall be entitled to
injunctive relief, including specific performance, to enforce such
obligations, without the posting of any bond, and, if any action
should be brought in equity to enforce any of the provisions of
this Agreement, none of the parties hereto shall raise the defence
that there is an adequate remedy at law.
(h) Each party hereto shall do and perform or cause to be done and
performed all such further acts and things and shall execute and
deliver all such other agreements, certificates, instruments, and
documents as any other party hereto reasonably may request in
order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated
hereby.
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IN WITNESS WHEREOF the parties have executed this Agreement.
CAI CAPITAL PARTNERS AND COMPANY II, L.P. BY
ITS GENERAL PARTNER, CAI CAPITAL PARTNERS GP
& CO., L.P., BY ONE OF ITS GENERAL PARTNERS
00 XXXXXXXXXX XX. II. CO.
By:
---------------------------------------
Name: Xxxxx Xxxxxxx
Title: President
CAI PARTNERS AND COMPANY II, L.P. BY ITS
GENERAL PARTNER, CAI PARTNERS GP & CO., L.P.,
BY ONE OF ITS GENERAL PARTNERS, 00 XXXXXXXXXX
XX. II. CO.
By:
---------------------------------------
Name: Xxxxx Xxxxxxx
Title: President
CAI CAPITAL PARTNERS AND COMPANY II-C, L.P.,
BY ITS GENERAL PARTNER, CAI CAPITAL PARTNERS
XX XX-C INC.
By:
---------------------------------------
Name: Xxxxxxx Xx
Title: Assistant Secretary
CAI MANAGERS & CO., L.P.
By:
---------------------------------------
Name: Xxxxxxx Xx
Title: Vice-President and Secretary
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597858 B.C. LTD., AS AGENT
By:
---------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Director
ONTARIO TEACHERS' PENSION PLAN BOARD
By:
---------------------------------------
Name: Xxx Xxxxxxx
Title: Vice-President, Relationship
Investing
XXXXXXXXX, XXXXXXXXX AND ASSOCIATES LTD.
By:
---------------------------------------
Name: Anil Wirasekara
Title: Chief Financial Officer
MDA HOLDINGS CORPORATION
By:
---------------------------------------
Name:
Title:
ORBITAL SCIENCES CORPORATION
ONLY FOR THE PURPOSES OF SECTIONS 3.5 , 3.7
AND 3.8
By:
---------------------------------------
Name:
Title:
