NORTH AMERICAN ENERGY PARTNERS INC.
November 28, 2006
Perry Partners, X.X.
Xxxxx Partners International, Inc.
(the "Advisors")
c/o Perry Strategic Capital Inc.
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The Advisor has extensive experience in strategic planning, which
experience would be of assistance to the Company. The Advisor is party to a
Voting and Corporate Governance Agreement with the Company which provided the
Advisor with certain board representation rights in the Company. The Voting and
Corporate Governance Agreement will be terminated on the completion of the
initial public offering of the Company's shares (the "IPO").
In order to assist the Company in strategic planning, the Company would
like to avail itself of the Advisor's expertise and advice. The Advisor is
willing to provide such expertise and experience at no cost to the Company, as
it is in their interest to do so in light of the Advisor's investment in the
Company. In order to be able to obtain this assistance in a meaningful way, the
Company will:
(a) provide copies of all documents, reports, financial data and other
information regarding the Company and its subsidiaries as may be
reasonably requested by the Advisor;
(b) permit the Advisor to consult with and advise the management of the
Company and its subsidiaries at such reasonable times on all matters
relating to the operation of the Company and its subsidiaries;
(c) permit the Advisor to discuss the Company's and its subsidiaries'
affairs, finances and accounts with the Company's and its
subsidiaries' officers, directors and outside accountants at such
reasonable times as may be requested by the Advisor;
(d) permit the Advisor to visit and inspect any of the Company's and its
subsidiaries' properties and facilities, at such reasonable times as
may be requested by the Advisor;
(e) permit the Advisor, to the extent that a director of the Company is
not related to the Advisor, to designate and send a representative to
attend all meetings of the Company's board of directors in a nonvoting
observer capacity, provided that such right is subject to security
clearance requirements imposed by applicable governmental authorities
and to the ability of the Company to exclude such representative
during discussions relating to transactions or matters in which the
Advisor has an interest;
(f) provide as soon as available and in any event within 60 days after the
end of each of the first three quarters of each fiscal year of the
Company, consolidated balance sheets of the Company and its
subsidiaries as of the end of such period and consolidated statements
of income and cash flows of the Company and its subsidiaries for the
period then ended prepared in conformity with generally accepted
accounting principles in Canada applied on a consistent basis, except
as otherwise noted therein, and subject to the absence of footnote
disclosures and to year-end adjustments; provided that the filing of
the Company's quarterly and annual financial statements with the
Securities and Exchange Commission (the "SEC") or the securities
regulatory authorities in the provinces and territories of Canada (the
"CSA") within the time periods required by the rules and regulations
of the SEC and the CSA, as applicable, shall be deemed to satisfy such
delivery requirements;
(g) provide as soon as available and in any event within 120 days after
the end of each fiscal year of the Company, a consolidated balance
sheet of the Company and its subsidiaries as of the end of such year
and consolidated statements of income and cash flows of the Company
and its subsidiaries for the year then ended prepared in conformity
with generally accepted accounting principles in Canada applied on a
consistent basis, except as otherwise noted therein, together with an
auditor's report thereon of a firm of established national reputation;
provided that the filing of the Company's quarterly and annual
financial statements with the SEC or the CSA within the time periods
required by the rules and regulations of the SEC and the CSA, as
applicable, shall be deemed to satisfy such delivery requirements;
(h) provide, to the extent the Company is required by law or pursuant to
the terms of any outstanding indebtedness of the Company to prepare
such reports, any annual reports, quarterly reports and other periodic
reports pursuant to Section 13 or 15(d) of the Securities Act of 1933
actually prepared by the Company as soon as available; provided that
the filing of the Company's quarterly and annual financial statements
with the SEC or the CSA within the time periods required by the rules
and regulations of the SEC and the CSA, as applicable, shall be deemed
to satisfy such delivery requirements; and
(i) provide all materials sent by the Company to its board of directors,
other than materials dealing with transactions in which the Advisor
has an interest.
The Advisor acknowledges that the provision by the Company of the material
and access provided for above may include the provision of or access to certain
non-public information with respect to the Company. As a condition to furnishing
the Advisor with such information and any other information (whether in oral or
written form, electronically stored or otherwise) delivered to the Advisor by
the Company or any of its affiliates, directors, officers, employees, advisors,
agents or representatives (such persons for the Company or the Advisor being
herein referred to collectively as "Representatives") in connection with the
provision of such expertise and advice
(such information, including any and all copies and other reproductions thereof,
being herein referred to as "Confidential Information"), the Advisor xxxxxx
agrees as follows:
(a) The Advisor: (i) will use the Confidential Information solely for the
purpose of providing the Company with its expertise and advice to the
Company; (ii) will keep the Confidential Information strictly
confidential and will not (except as required by applicable law,
regulation or legal process, and only after compliance with paragraph
(c) below), without the Company's prior written consent, disclose in
any manner whatsoever any information contained in the Confidential
Information or derived therefrom. The Advisor agrees to be liable to
the Company for any breach of this Agreement by the Advisor or its
Representatives, and the Advisor hereby agrees to indemnify and hold
harmless the Company from and against any and all loss, damage, cost,
expense and liability incurred or suffered from or as a result of any
such breach.
(b) The term "Confidential Information" does not include any information
which (i) at the time of disclosure or thereafter is generally known
by the public (other than as a direct or indirect result of its
disclosure by the Advisor in breach of this Agreement); or (ii) was or
becomes available to the Advisor on a non-confidential basis from a
person to the Advisor's knowledge not otherwise bound by a
confidentiality agreement with the Company or its Representatives or
is not otherwise prohibited from transmitting the information to the
Advisor. As used in this Agreement, the term "person" shall be broadly
interpreted to include, without limitation, any corporation, company,
joint venture, partnership or individual.
(c) In the event that the Advisor receives a request or is required to
disclose all or any part of the information contained in the
Confidential Information pursuant to the terms of a subpoena or order
issued by a court of competent jurisdiction or a federal, state,
provincial, territorial, municipal or local governmental or regulatory
body or pursuant to a civil investigative demand or similar judicial
process, the Advisor agrees to (i) immediately notify the Company of
the existence, terms and circumstances surrounding such a request or
requirement, (ii) consult with the Company on the advisability of
taking legally available steps to resist or narrow such request or
requirement, and (iii) if disclosure of such information is required,
disclose any such information which the Advisor is advised in writing
by legal counsel is legally required to be disclosed and will exercise
the Advisor's reasonable efforts to obtain a protective order or other
reliable assurance that confidential treatment will be accorded to all
such information.
(d) The Advisor acknowledges the prohibition under applicable securities
and criminal law against trading in securities of the Company with
knowledge of material undisclosed information.
(e) The Advisor agrees to be bound by the Company's policy on trading in
securities.
If at any time the Advisor holds less than 10% of the common shares of the
Company that it originally acquired in November, 2003 (as such shares may be
adjusted for share splits and consolidations), the Company may terminate this
letter agreement in its sole discretion.
The Company acknowledges and agrees that the Advisor shall not incur any
liability to the Company as a result of providing or failing to provide any
advice under this letter agreement.
The Advisor's signature below indicates our assent to the terms of this
letter agreement as of the date set forth above.
Very truly yours,
North American Energy Partners Inc.
By: \s\ Xxxxxxx Xxxxxxx
----------------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President, Corporate and Secretary
Agreed to and accepted by:
Perry Partners, L.P.
By: Perry Corp., its Managing General Partner
By: \s\ Xxxxxxx X. Xxxx
------------------------------
Name: Xxxxxxx X. Xxxx
Title: General Counsel
Perry Partners International, Inc.
By: Perry Corp., its Investment Manager
By: \s\ Xxxxxxx X. Xxxx
-------------------------------
Name: Xxxxxxx X. Xxxx
Title: General Counsel
