EXHIBIT 10.12
SPARKLING SPRING WATER HOLDINGS LIMITED
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "AGREEMENT") is made as of the
_____ day of June 2002, by and among Sparkling Spring Water Holdings Limited, a
corporation incorporated under the laws of the province of Nova Scotia
("HOLDCO"), and Clairvest Group Inc., a corporation incorporated under the laws
of the Province of Ontario ("CLAIRVEST"), Egeria B.V., a corporation
incorporated under the laws of The Netherlands ("EGERIA"), and G. Xxxx Xxxxxxx
("KREDIET") (Clairvest, Egeria and Krediet each individually, a "SHAREHOLDER"
and collectively, the "SHAREHOLDERS").
RECITALS
A. Holdco and the Shareholders are parties to that certain Shareholder
Agreement dated July 31, 2000 and Supplemental Shareholders' Agreement dated
March 15, 2001 (collectively, the "EXISTING AGREEMENTS") pursuant to which
Holdco granted the Shareholders, among other things, certain registration
rights.
B. Holdco is in the process of preparing for its first firm commitment
underwritten public offering of its Common Shares under the Securities Act of
1933, as amended (the "INITIAL OFFERING").
C. In order to induce Holdco and its underwriters to effect the Initial
Public Offering, Holdco and Shareholders desire to supersede the registration
rights set forth in the Existing Agreements with the registration rights set
forth herein.
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, the Shareholders hereby agree that the registration rights set
forth in the Existing Agreements shall be superseded and replaced in their
entirety by this Agreement, and the parties hereto further agree as follows:
AGREEMENT
1. DEFINITIONS
In this Agreement, including the above recitals, the following terms
have the following meanings unless the context otherwise requires:
"CANADIAN SECURITIES LAWS" means statutes and regulations applicable to
the trading of securities in any province or territory of Canada including
applicable rules, policies, statements and blanket rulings and orders made by
Canadian securities regulatory authorities.
"EXCHANGE ACT" means the United States Securities Exchange Act of 1934,
as amended, or any similar federal statute, and the rules and regulations of the
SEC thereunder, all as the same shall be in effect from time to time.
"PUBLIC OFFERING" means an underwritten or best efforts public offering
of Shares pursuant to an effective prospectus or registration statement under
the Securities Laws.
"PUBLIC SALE" means a sale (i) pursuant to a Public Offering, or (ii)
under Rule 144 of the Securities Act and its equivalent under Canadian
Securities Laws.
"REGISTRATION EXPENSES" means (i) all registration and prospectus filing
fees, (ii) fees and expenses of compliance with securities or blue sky laws
(including reasonable fees and disbursements of counsel in connection with blue
sky qualifications of the Shares), (iii) printing expenses, (iv) internal
expenses of Holdco (including, without limitation, all salaries and expenses of
its officers performing legal or accounting duties), (v) reasonable fees and
disbursements for counsel for Holdco and customary fees and expenses for
independent certified public or chartered accountants retained by Holdco
(including the expenses of any comfort letters or costs associated with the
delivery by accountants of a comfort letter or comfort letters requested
pursuant to paragraph (g) of Schedule "A" hereto), (vi) the reasonable fees and
expenses of any special experts retained by Holdco in connection with such
registration or qualification, (vii) reasonable fees and expenses of one counsel
for all the selling Shareholders, (viii) fees and expenses in connection with
any review of underwriting arrangements by the National Association of
Securities Dealers, Inc. or any comparable Canadian association including fees
and expenses of any "qualified independent underwriter", (ix) fees and expenses
of listing the Shares on an exchange or other trading system, and (x) fees and
disbursements of underwriters customarily paid by issuers or sellers of
securities; but shall not include any underwriting fees, discounts or commission
attributable to the sale of Shares, or any out-of-pocket expenses (except as set
forth in clause (vii) above) of the Shareholders (or the agents who manage their
accounts) or any fees and expenses of underwriter's counsel.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the United States Securities Act of 1933, as
amended, or any similar federal statute and the rules and regulations of the SEC
thereunder, all as the same shall be in effect from time to time;
"SECURITIES LAW" shall mean the Securities Act, the Exchange Act and
Canadian Securities Laws.
"SHARES" means Common Shares of Holdco held by the Shareholders on the
date hereof, any Common Shares of Holdco issued to the Shareholders upon the
exercise of options or warrants of Holdco held by the Shareholders on the date
hereof, or any Common Shares of Holdco issued as a dividend or other
distribution with respect to, or in exchange for, or in replacement of, the
shares referenced above; provided that, Common Shares shall
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only be treated as Shares if and so long as they have not been (A) sold in a
Public Sale or (B) sold in a transaction exempt from the registration and
prospectus delivery requirements of the Securities Act under Section 4(1)
thereof so that all transfer restrictions, and restrictive legends with respect
thereto, if any, are removed upon the consummation of such sale.
2. REGISTRATION RIGHTS
2.1 DEMAND REGISTRATION
(a) At any time after the date six months after the effective date of
the Initial Offering, upon written request of any Shareholder that Holdco effect
the registration or qualification under the Securities Laws of Shares of such
Shareholder, and specifying the intended method of disposition thereof, Holdco
will promptly give written notice of such requested registration (a "DEMAND
REGISTRATION") at least twenty (20) days prior to the anticipated filing date of
the prospectus or registration statement relating to such Demand Registration to
all other Shareholders, and thereupon will use its best efforts to effect, as
expeditiously as possible, the registration under the Securities Laws of:
(x) the Shares that Holdco has been so requested to qualify or
register by the initiating Shareholder, then held by the
initiating Shareholder; and
(y) all other Shares that any other Shareholder (all such
Shareholders, together with the initiating Shareholder, the
"HOLDERS") has requested Holdco to qualify or register, subject
to Section 2.2 hereof, by written request received by Holdco
within ten (10) days after the receipt by such Holders of such
written notice given by Holdco,
all to the extent necessary to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Shares so to be registered;
provided that (i) Holdco shall not be obligated to effect a Demand Registration
if the anticipated aggregate gross offering price of the offered Shares is less
than $10,000,000 ($3,000,000 in the case of a requested registration on Form
F-3), (ii) Holdco shall not be obligated to effect a Demand Registration if
Holdco shall furnish to the Holders a certificate signed by Holdco's Chief
Executive Officer or Chairman of the Board stating that in the good faith
judgement of the Board of Directors of Holdco, it would be seriously detrimental
to Holdco and its shareholders for such registration statement to be effected at
such time, in which event Holdco shall have the right to defer such filing for a
period of not more ninety days after receipt of the request of the initiating
Shareholder, provided that Holdco shall not exercise its right to delay a
request pursuant to this Section 2.1(a)(ii) or Section 2.1(a)(iii) more than
once in a twelve-month period, (iii) Holdco shall not be obligated to effect a
Demand Registration during the period starting with the date sixty days prior to
Holdco's good faith estimate of the date of the filing of, and ending on the
date one-hundred eighty days following the effective date of, a Holdco-initiated
registration subject to Section 2.2 below, provided that Holdco is actively
employing in good faith, its best efforts to cause such registration to become
effective, provided further that the actual filing occurs within twenty days
before or after the original good faith estimate of the
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filing date and provided further than the suspension of Holdco's obligations
pursuant to this Section 2.1(a)(iii) or Section 2.1(a)(ii) shall be effective
only once during any twelve-month period, (iv) Holdco shall not be obligated to
effect more than one Demand Registration in any six-month period, and (v) Holdco
shall not be obligated to effect more than one (1) Demand Registration for each
of the Shareholders pursuant to this Section 2.1, unless Holdco shall be
eligible to file a registration statement on Form F-3 under the Securities Act
(or other comparable short form, including a short form prospectus under
National Instrument 44-101 of the Canadian Securities Administrators), in which
event there shall be no limit on the number of such Demand Registrations
pursuant to this Section 2.1.
Promptly after the expiration of the ten (10) day period
referred to in Section 2.1(a)(ii) hereof, Holdco will notify all the Holders to
be included in the Demand Registration of the other Holders and the number of
Shares requested to be included therein. The participating Shareholders may, at
any time prior to the effective date of the prospectus or registration statement
relating to such registration, revoke such request by providing a written notice
to Holdco, in which case such request, so revoked shall not be considered a
Demand Registration if any fees incurred by Holdco as a result of such revoked
request are paid pro rata by the participating Shareholders based on the number
of shares each requested to be included in the registration or qualification.
(b) Subject to Section 2.1(c), Holdco will pay all Registration
Expenses in connection with any Demand Registration; provided that if Holdco is
required to undertake an audit of Holdco that it would not otherwise have been
required to undertake, the costs associated with such audit shall be for the
account, pro rata, of the participating Shareholders.
(c) A qualification or registration requested pursuant to this
Section 2.1 shall not be deemed to have been effected unless the prospectus or
registration statement relating thereto (i) has become effective under the
Securities Laws, and (ii) has remained effective for a period of at least ninety
(90) days (or such shorter period in which all Shares of the Holders included in
such registration has actually been sold thereunder); provided that if after any
prospectus or registration statement requested pursuant to this Section 2.1
becomes effective such prospectus or registration statement is interfered with
by any stop order, cease trade order, injunction or other order or requirement
of the SEC, the Canadian securities regulatory authorities or other governmental
agency or court solely due to the actions or omissions to act of Holdco, such
prospectus or registration statement shall be at the sole expense of Holdco and
shall not be considered a Demand Registration. In the event that less than
seventy-five (75%) percent of the participating Shareholders' Shares initially
proposed to be included in such prospectus or registration have been sold
thereunder and the participating Shareholders pay pro rata all Registration
Expenses in connection with such prospectus or registration, such requested
qualification or registration shall be deemed not to be a Demand Registration
pursuant to this Section 2.1.
(d) If a Demand Registration involves a Public Offering and the
managing underwriter shall advise Holdco and Holders that, in its view, (i) the
number of Shares
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requested to be included in such registration or qualification (including Shares
which Holdco proposes to be included), or (ii) the inclusion of some or all of
the Shares owned by the Holders, in either case, exceeds the largest number of
Shares which can be sold without having a material adverse effect on such
offering, including the price at which such Shares can be sold (the "MAXIMUM
OFFERING SIZE"), Holdco will include in such registration or qualification, in
the priority listed below, up to the Maximum Offering Size:
(i) first, such number of Shares requested to be included in
such registration or qualification by the Shareholders (allocated, if necessary,
for the offering not to exceed the Maximum Offering Size, pro rata among such
other Shareholders on the basis of the relative number of Shares requested by
such Shareholders to be included in such registration or qualification, provided
that to the extent the number of Shares requested by the initiating Shareholder
to be included in such registration or qualification exceeds 75% of the Maximum
Offering Size, the allocation shall be adjusted to the extent necessary to
permit the initiating Shareholder to be allocated not less than 75% of the
Maximum Offering Size); and
(ii) second, any Shares proposed to be registered or qualified
by Holdco.
(e) No Shareholder shall have the right to restrain or delay any
registration or qualification of Shares by Holdco on the basis of any dispute or
controversy concerning a Demand Registration.
2.2 INCIDENTAL REGISTRATION
(a) If Holdco proposes to register any of its Shares under the
Securities Laws, it will each such time, subject to the provisions of Section
2.2(b) hereof, give prompt written notice at least twenty (20) days prior to the
anticipated filing date of the prospectus or registration statement relating to
such registration to each Shareholder which notice shall set forth such
Shareholders' rights under this Section 2.2 and shall offer all Shareholders the
opportunity to include in such prospectus or registration statement such number
of Shares as each such Shareholder may request (an "INCIDENTAL REGISTRATION").
Upon the written request of any such Shareholder made within ten (10) days after
the receipt of notice from Holdco (which request shall specify the number of
Shares intended to be disposed of by such Shareholder), Holdco will use its best
efforts to effect the qualification or registration under the Securities Laws of
all Shares which Holdco has been so requested to quality or register by such
Shareholders, to the extent requisite to permit the disposition of the Shares so
to be qualified or registered; provided that (A) if such qualification or
registration involves a Public Offering, all such Shareholders requesting to be
included in Holdco's prospectus or registration must sell their Shares to the
underwriters of the Public Offering on the same terms and conditions as apply to
Holdco, and (B) if, at any time after giving written notice of its intention to
qualify or register any Shares pursuant to this Section 2.2(a) and prior to the
effective date of the prospectus or registration statement filed in connection
with such qualification or registration, Holdco shall determine for any reason
not to qualify or register Holdco's Shares, Holdco shall give written notice to
all such Shareholders and, thereupon,
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shall be relieved of its obligation to register any Shares in connection with
such qualification or registration (without prejudice, however, to rights of any
of the Shareholders under Section 2.1 hereof). No qualification or registration
effected under this Section 2.2 shall relieve Holdco of its obligations to
effect a Demand Registration to the extent required by Section 2.1 hereof.
Holdco will pay all Registration Expenses in connection with each qualification
or registration of Shares requested pursuant to this Section 2.2.
(b) If a qualification or registration pursuant to this Section 2.2
involves a Public Offering (other than in the case of a Public Offering
requested by an initiating Shareholder, in a Demand Registration, in which case
the provisions with respect to priority of inclusion in such offering set forth
in Section 2.1(d) shall apply) and the managing underwriter advises Holdco that,
in its view, the number of Shares that Holdco and such Shareholders intend to
include in such qualification or registration exceeds the Maximum Offering Size,
Holdco will include in such qualification or registration the Maximum Offering
Size:
(i) first, so much of the Shares proposed to be qualified or
registered by Holdco, not to exceed two-thirds (2/3) of the Maximum Offering
Size;
(ii) second, all Shares requested to be included in such
qualification or registration by any Shareholder pursuant to this Section 2.2
(allocated, if necessary for the offering not to exceed the Maximum Offering
Size, pro rata among such Shareholders on the basis of the relative number of
Shares so requested to be included in such qualification or registration); and
(iii) so much of the remainder of the Shares proposed to be
qualified or registered by Holdco as would not cause the offering to exceed the
Maximum Offering Size.
2.3 HOLDBACK AGREEMENTS
If any qualification or registration of Shares shall be in connection
with a Public Offering, each Shareholder agrees not to effect any Public Sale of
any Shares or of any securities convertible into or exchangeable or exercisable
for any Shares (in each case, other than as part of such Public Offering) except
as the managing underwriter may advise reasonably.
2.4 REGISTRATION PROCEDURES
The registration procedures set out in Schedule "A" hereof will apply
with respect to the provisions of Sections 2.1 and 2.2 hereof.
2.5 TERMINATION OF REGISTRATION RIGHTS
No Shareholder shall be entitled to exercise any right provided for in
this Agreement after five years following the consummation of the Initial
Offering or, as to any Shareholder, such earlier time at which all Shares held
by such Shareholder (and any affiliate of the
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shareholder with whom such Shareholder must aggregate its sales under Rule 144)
can be sold in any three (3)-month period without registration in compliance
with Rule 144 of the Securities Act.
3. MISCELLANEOUS
3.1 SUCCESSORS AND ASSIGNS
The rights to cause Holdco to register Registrable Securities pursuant
to this Agreement may be assigned (but only with all related obligations) by a
Shareholder to a transferee or assignee of such securities that (a) is a
subsidiary, parent, partner, limited partner, member, retired member, retired,
partner or shareholder of a Shareholder, (b) is a Shareholder's family member or
trust for the benefit of an individual Shareholder, (c) held Registrable
Securities prior to such transfer, or (d) after such assignment or transfer,
holds at least 700,000 Shares (subject to appropriate adjustment for stock
splits, stock dividends, combinations and other recapitalizations) (or such
lesser amount if the Shareholder is transferring all Registrable Securities held
by such Shareholder), provided: (i) Holdco is, within a reasonable time after
such transfer, furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being assigned; (ii) such transferee or assignee agrees
in writing to be bound by and subject to the terms and conditions of this
Agreement; and (iii) such assignment shall be effective only if immediately
following such transfer the further disposition of such securities by the
transferee or assignee is restricted under the Act. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties
(including transferees of any shares of Registrable Securities). Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
3.2 GOVERNING LAW
This Agreement shall be governed by and construed under the laws of the
Province of Nova Scotia and the federal laws of Canada as applicable therein.
3.3 COUNTERPARTS
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
3.4 TITLES AND SUBTITLES
The titles and subtitles used in this Agreement are used for convenience
only and are not to be considered in construing or interpreting this Agreement.
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3.5 NOTICES
Unless otherwise provided, any notice required or permitted under this
Agreement shall be given in writing and shall be deemed effectively given (a)
upon personal delivery to the party to be notified, (b) upon receipt by the
sender of a confirmation of a successful facsimile transmission, (c) one
business day after deposit with a nationally recognized overnight courier
service, prepaid for overnight delivery and addressed as set forth on the
signature pages hereto, or (d) five days after deposit in the mails, postage
prepaid, registered or certified with return receipt requested and addressed to
the party to be notified at the address indicated for such party on the
signature page hereto, or at such other address as such party may designate by
ten days' advance written notice to the other parties.
3.6 EXPENSES
If any action at law or in equity is necessary to enforce or interpret
the terms of this Agreement, the prevailing party shall be entitled to
reasonable attorneys' fees, costs and necessary disbursements in addition to any
other relief to which such party may be entitled.
3.7 ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS
This Agreement (including the schedule hereto) supersedes the
registrations rights provisions of the Existing Agreements and constitutes the
full and entire understanding and agreement among the parties with regard to the
subjects hereof and thereof (but is in addition to and does not supersede any
agreement regarding between any Shareholder and underwriter of Holdco regarding
the lockup of such Shareholder's shares subsequent to the Initial Offering). Any
term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of Holdco and the
holders of a majority of the Registrable Securities. Any amendment or waiver
effected in accordance with this paragraph shall be binding upon each Holder of
any Registrable Securities, each future Holder of any Registrable Securities and
Holdco.
3.8 SEVERABILITY
If one or more provisions of this Agreement are held to be unenforceable
under applicable law, such provision shall be excluded from this Agreement and
the balance of the Agreement shall be interpreted as if such provision were so
excluded and shall be enforceable in accordance with its terms.
3.9 AGGREGATION OF STOCK
All shares of Registrable Securities held or acquired by affiliated
entities or persons shall be aggregated together for the purpose of determining
the availability of any rights under this Agreement.
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[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first above written.
SPARKLING SPRING WATER HOLDINGS LIMITED
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By:
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Title:
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Address: ATTN: President
00 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx Xxxxxx
X0X 0X0
Fax: (000) 000-0000
SIGNATURE PAGE TO
REGISTRATION RIGHTS AGREEMENT
CLAIRVEST GROUP, INC.
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By:
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Title:
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Address: ATTN: Xxxxxxx X. Xxxxxx
00 Xx. Xxxxx Xxxxxx Xxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx
X0X 253
Fax: (000) 000-0000
SIGNATURE PAGE TO
REGISTRATION RIGHTS AGREEMENT
EGERIA B.V.
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By:
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Title:
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Address: ATTN: Xxx Xxxxxxx
Xxxxxxxxxxxxx 000
0000 XX XXXXXXXXX
Xxx Xxxxxxxxxxx
Fax: (000) 00-000-000-000
SIGNATURE PAGE TO
REGISTRATION RIGHTS AGREEMENT
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G. Xxxx Xxxxxxx
Address: c/o Sparkling Spring Water
UK Limited
00 Xxxxx Xxxxx Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxx XX0X0XX
Fax: (000) 00-000-000-0000
SIGNATURE PAGE TO
REGISTRATION RIGHTS AGREEMENT
SCHEDULE "A"
REGISTRATION PROCEDURES
Whenever Shareholders request that any Shares be qualified or registered
pursuant to Section 2.1 or 2.2, Holdco will, subject to the provisions of such
Sections, use its best efforts to effect the qualification or registration and
the sale of such Shares in accordance with the intended method of disposition
thereof as quickly as practicable, and in connection with any such request:
(a) Holdco will as expeditiously as possible prepare and file with the
SEC and/or with the relevant Canadian securities regulatory authority a
prospectus and/or registration statement on any form for which Holdco then
qualifies or which counsel for Holdco shall deem appropriate and which form
shall be available for the sale of the Shares to be qualified or registered
thereunder in accordance with the intended method of distribution thereof, and
use its best efforts to cause such filed prospectus and/or registration
statement to become and remain effective for a period of not less than ninety
(90) days or, if earlier, until the distribution contemplated in the
registration statement has been completed.
(b) Holdco will, if requested, prior to filing a registration statement
or prospectus or any amendment or supplement thereto, furnish to each
Shareholder and each underwriter, if any, of the Shares covered by such
registration statement, copies of such registration statement as proposed to be
filed, and thereafter Holdco will furnish to such Shareholder and underwriter,
if any, such number of copies of such registration statement, each amendment and
supplement thereto (in each case including all exhibits thereto and documents
incorporated by reference therein), the prospectus included in such registration
statement (including each preliminary prospectus) and such other documents as
such Shareholder or underwriter may reasonably request in order to facilitate
the disposition of the Shares owned by such Shareholder.
(c) After the filing of the prospectus and/or registration statement,
Holdco will promptly notify each Shareholder holding Shares covered by such
prospectus and/or registration statement of any stop order or cease trade order
issued or threatened by the SEC or by any relevant Canadian securities
regulatory authority and take all reasonable actions required to prevent the
entry of such stop order or cease trade order or to remove or revoke it if
entered.
(d) Holdco will use its best efforts to (i) register or qualify the
Shares covered by such prospectus or registration statement under such other
securities or blue sky laws of such jurisdictions in the United States and
Canada as any Shareholder holding such Shares reasonably (in light of such
Shareholder's intended plan of distribution) requests and (ii) cause such Shares
to be qualified or registered with or approved by such other governmental
agencies or authorities as may be necessary by virtue of the business and
operations of
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Holdco and do any and all other acts and things that may be reasonably
necessary or advisable to enable such Shareholder to consummate the disposition
of the Shares owned by such Shareholder; provided that Holdco will not be
required to (A) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this paragraph (d), (B)
subject itself to taxation in any such jurisdiction, or (C) consent to general
service of process in any such jurisdiction.
(e) Holdco will immediately notify each Shareholder holding such Shares,
at any time when a prospectus relating thereto is required to be delivered under
the Securities Laws, of the occurrence of an event requiring the preparation of
a supplement or amendment to such prospectus so that, as thereafter delivered to
the purchasers of such Shares, such prospectus will contain full, true and plain
disclosure of all material facts relating to the securities covered thereby and
will not contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances in which they were made and
promptly prepare and make available to each such Shareholder any such supplement
or amendment.
(f) Upon the execution of confidentiality agreements in form and
substance satisfactory to Holdco, Holdco will make available for inspection by
any Shareholder and any underwriter participating in any disposition pursuant to
a prospectus or registration statement being filed by Holdco and any attorney,
accountant or other professional retained by any such Shareholder or underwriter
(collectively, the "INSPECTORS"), all financial and other records, pertinent
corporate documents and properties of Holdco (collectively, the "RECORDS") as
shall be reasonably necessary to enable them to exercise their due diligence
responsibility, and cause Holdco's officers, directors and employees to supply
all information reasonably requested by any Inspectors in connection with such
prospectus or registration statement. Records that Holdco determines, in good
faith, to be confidential and that it notifies the Inspectors are confidential
shall not be disclosed by the Inspectors unless (i) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in such
prospectus or registration statement or (ii) the release of such Records is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction or from any Canadian securities regulatory authority.
(g) Holdco will furnish to each such Shareholder and to each such
underwriter, if any, a signed counterpart, addressed to such underwriter, of (i)
an opinion or opinions of counsel to Holdco and (ii) a comfort letter or comfort
letters from Holdco's independent public or chartered accountants, each in
customary form and covering such matters the type customarily covered by
opinions or comfort letters, the case may be, as the Holders or managing
underwriter therefor reasonably requests.
(h) Holdco will otherwise use its best efforts comply with all
applicable rules and regulations of the SEC and the relevant Canadian securities
regulatory authorities.
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(i) Holdco may require each such Shareholder to promptly furnish in
writing to Holdco such information regarding the distribution of the Shares as
Holdco may from time to time reasonably request and such other information as
may be legally required in connection with such registration or qualification.
Each such Shareholder agrees that, upon receipt of a notice from Holdco
of the happening of any event of the kind described in paragraph (e) above, such
Shareholder will forthwith discontinue disposition of Shares pursuant to the
prospectus or registration statement covering such Shares until such
Shareholder's receipt of the copies of the supplemented or amended prospectus
contemplated by paragraph (e) above, and, so directed by Holdco, such
Shareholder will deliver to Holdco all copies, other than any permanent file
copies then in such Shareholder's possession, of the most recent prospectus
covering such Shares at the time of receipt of such notice. In the event that
Holdco shall give such notice, Holdco shall extend the period during which such
prospectus or registration statement shall be maintained effective (including
the period referred to in paragraph (a) above) by the number of days during the
period from and including the date of the giving of notice pursuant to paragraph
(e) above to the date when Holdco shall make available to such Shareholder a
prospectus supplemented or amended to conform with the requirements of paragraph
(e) above.
Holdco agrees to indemnify and hold harmless each Shareholder holding
Shares covered by a prospectus or registration statement, its officers,
directors and agents, and each person, if any, who controls such Shareholder
within the meaning of Section 15 of the Securities Act, Section 20 of the
Exchange Act or Section 1 of the Securities Act (Ontario) from and against any
and all losses, claims, damages and liabilities (including those resulting from
any order made or any inquiry, investigation or proceeding commenced or
threatened by any securities regulatory authority, stock exchange or by any
other competent authority) caused by any untrue statement or alleged untrue
statement of a material fact contained in any registration statement or
prospectus relating to the Shares (as amended or supplemented if Holdco shall
have furnished any amendments or supplements thereto) or any preliminary
prospectus, or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which they were made,
except insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon information furnished in writing to Holdco by such Shareholder or on such
Shareholder's behalf expressly for use therein; provided that Holdco shall not
be liable for any untrue statement or omission contained in a preliminary
prospectus which untrue statement or omission was corrected in a final
prospectus or supplement which was furnished to such Shareholder. Holdco also
agrees to indemnify any underwriters of the Shares, their officers, directors,
employees and agents and each person who controls such underwriters (other than
in respect of loss of profit or information relating solely to the underwriters)
on substantially the same basis as that of the indemnification of the
Shareholders provided in this paragraph and which indemnification shall provide,
in addition,
-3-
an indemnity in respect of any breach of representation or warranty of Holdco
contained in any underwriting agreement in respect of Shares.
-4-
