EXHIBIT 1
October 25, 2004
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, ▇▇▇▇▇▇▇ ▇▇▇▇▇ Canada Inc. ("MLCI") and National Bank
Financial Inc. ("NBF", and, together with MLCI, the "Agents", and,
individually, an "Agent"), understand that ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc. (the
"Company"), a Delaware corporation, proposes to issue and sell up to
Cdn.$1,750,600 Global Equity Performance Weighted Notes, Series 2 due October
27, 2011 (the "Notes") and up to Cdn.$3,103,000 Global Equity Performance
Weighted Warrants, Series 2 due October 27, 2011 (the "Warrants", and,
together with the Notes, the "Securities", and, individually, a "Security").
We understand that the Company has filed with the United States Securities and
Exchange Commission (the "SEC") under the United States Securities Act of
1933, as amended (the "1933 Act"), a registration statement on Form S-3
relating to the offering of debt securities, warrants, preferred stock,
depositary shares and common stock of the Company pursuant to Rule 415 under
the 1933 Act (such registration statement, declared effective by the SEC on
November 26, 2003 under the 1933 Act, including the exhibits thereto and the
documents incorporated by reference therein, being hereinafter referred to as
the "Registration Statement") and a related prospectus dated November 26,
2003.
The Company has also filed (i) with the SEC pursuant to Rule 424(b)(6) under
the 1933 Act a registration statement and related prospectus dated June 29,
2004 (the "U.S. Shelf Prospectus"), and (ii) with the Canadian securities
regulatory authorities (the "Canadian Securities Commissions") of each of the
provinces and territories of Canada (the "Qualifying Jurisdictions") a
Canadian shelf prospectus dated June 29, 2004 (the "Canadian MJDS Prospectus")
under National Instrument 71-101 - The Multijurisdictional Disclosure System
("NI 71-101"), which includes the U.S. Shelf Prospectus (which such deletions
therefrom and additions thereto as are permitted or required by NI 71-101), in
order to qualify the offering and sale of up to $18,362,988,000 aggregate
amount of debt securities, warrants, preferred stock, depositary shares and
common stock in Canada. A final receipt was issued for the Canadian MJDS
Prospectus by the Ontario Securities Commission, on behalf of itself and the
other Canadian Securities Commissions, on June 30, 2004.
The Company has also prepared and filed with the SEC in accordance with Rule
424(b)(6) under the 1933 Act and with the Canadian Securities Commissions
under NI 71-101 a preliminary MJDS prospectus supplement (the "Preliminary
MJDS Supplement") dated September 23, 2004 relating to the offering of the
Notes and the Warrants. We understand that the Company will prepare a final
MJDS prospectus supplement to be dated the date of this Agreement and filed
(the "Final MJDS Supplement") with the SEC pursuant to Rule
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424(b)(6) under the 1933 Act and with the Canadian Securities Commissions
under NI 71-101 in order to qualify the Securities for distribution in each of
the Qualifying Jurisdictions (the "Offering").
The Company has requested the Agents to act as the sole and exclusive agents
of the Company to solicit, on a best efforts basis, offers to purchase the
Securities in all of the Qualifying Jurisdictions and the Agents hereby agree
to act as exclusive agents for such purpose on the terms and conditions
contained herein. In consideration of the services to be rendered to the
Company, the Company shall pay to NBF a fee of Cdn.$5.25 for each Security
sold (the "Agents' Fee") on the Closing Date. MLCI shall not be entitled to
receive a fee in connection with its acting as Agent ▇▇▇▇▇▇▇▇▇. The Company
has also agreed that the Agents may form a selling group consisting of
registered dealers to solicit offers to purchase the Securities and may
determine the fee to be paid to such selling group, which fee will be paid by
NBF out of the Agents' Fee.
1. Definitions and Interpretation
------------------------------
1.1 Unless otherwise defined herein, as used herein:
"Auditors" means the firm of Deloitte & Touche LLP (New York);
"Business Day" means a day which is not a Saturday, Sunday or statutory
or civic holiday in Toronto, Ontario;
"Canadian Securities Laws" means all applicable securities laws in each
of the Qualifying Jurisdictions and the respective regulations made
thereunder, together with applicable published policy statements, rules
and orders of the securities regulatory authorities in each of the
Qualifying Jurisdictions, including, for greater certainty, NI 71-101 and
Companion Policy 71-101CP;
"CDS" means The Canadian Depository for Securities Limited;
"Closing Date" means October 27, 2004, or such other date not later than
November 14, 2004 as the parties hereto may agree upon in writing;
"Closing Time" means 9:00 a.m. (Toronto time) on the Closing Date or such
other time on the Closing Date as the parties hereto may agree upon in
writing.
"distribution" means a "distribution" or "distribution to the public" as
defined in the Canadian Securities Laws and "distribute" has a
corresponding meaning;
"Indenture" means the amended and restated indenture dated as of April 1,
1983, as further amended and restated from time to time, between the
Company and the Trustee pursuant to which the Notes will be issued;
"misrepresentation", "material fact" and "material change" have the
respective meanings attributed thereto in the Securities Act (Ontario);
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"Prospectus" means, collectively, the U.S. Shelf Prospectus, the Canadian
MJDS Prospectus and the Final MJDS Supplement (in the English and French
languages), including the documents incorporated by reference therein;
"Prospectus Supplement" means, collectively, the Preliminary MJDS
Supplement and the Final MJDS Supplement (in the English and French
languages), including the documents incorporated by reference therein (in
the English and French languages);
"Supplementary Material" means, individually or collectively as the
context requires, any amendment or supplement to the Prospectus or
Prospectus Supplement or any amending or supplemental prospectus or other
supplemental documentation or any similar document required to be filed
by the Company under any of the Canadian Securities Laws during the
period of distribution of the Securities;
"Trustee" means JPMorgan Chase Bank, as trustee under the Indenture;
"U.S. Person" means any person who is or who acts, directly or
indirectly, in the capacity of agent for the benefit of:
(a) any natural person who is a resident in the United States, its
territories, possessions or all areas subject to its jurisdiction;
(b) any partnership, corporation, trust or other entity organized under
United States law or organized or owned beneficially primarily by
U.S. Persons;
(c) any estate or trust of which an executor, trustee or similar person
is a U.S. Person unless the beneficiaries are not U.S. Persons and a
non-U.S. Person who is also an executor, trustee or similar person
has or shares investment discretion;
(d) any U.S. agency or branch of a foreign person; or
(e) any discretionary or non-discretionary account for the benefit of a
U.S. Person;
"Warrant Agreement" means the warrant agreement dated October 27, 2004
between the Company and the Warrant Agent pursuant to which the Warrants
will be issued; and
"Warrant Agent" means JPMorgan Chase Bank, as warrant agent under the
Warrant Agreement.
1.2 Words importing the singular number only shall include the plural
and vice versa, and words importing the use of any gender shall
include all genders.
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1.3 The headings in this Agreement are for convenience of reference
only and shall not affect the interpretation or meaning of this
Agreement.
1.4 The following are the schedules attached to and forming part of
this Agreement:
Schedule A - Form of Legal Opinion of Canadian Counsel to the Company
Schedule B - Form of Legal Opinion of U.S. Counsel to the Company
Schedule C - Form of Legal Opinion of Counsel to the Agents
2. Appointment of Agents
---------------------
2.1 Subject to the following terms and conditions in this Agreement, the
Company hereby appoints the Agents, and the Agents hereby accept
such appointment, to act as the sole and exclusive agents of the
Company to lawfully solicit, on a best efforts basis, on behalf of
the Company, directly and through sub-agents lawfully authorized to
sell the Securities in the Qualifying Jurisdictions, offers to
purchase the Securities in the Qualifying Jurisdictions during the
period of the distribution of the Securities at an initial offering
price of Cdn.$100 per Security.
2.2 The Agents shall communicate to the Company, orally, each offer
to purchase Securities solicited by such Agents on an agency basis,
other than those offers rejected by the Agents. Each Agent shall
have the right, in its discretion reasonably exercised, to reject
any proposed purchase of Securities, as a whole or in part, and any
such rejection shall not be deemed a breach of the Agent's agreement
contained herein. The Company may accept or reject any proposed
purchase of the Securities, in whole or in part. The Agents shall
make reasonable efforts to assist the Company in obtaining
performance by each purchaser whose offer to purchase Securities has
been solicited by the Agents and accepted by the Company.
2.3 The Agents agree to use their best efforts to solicit offers to
purchase the Securities on the terms and conditions set forth herein
and in the Prospectus as aforesaid but it is hereby agreed and
understood that the Agents shall act as agents only and shall not at
any time be obligated to purchase or to arrange for the purchase of
any Securities. The Securities will be offered by the Agents
directly and through sub-agents lawfully authorized to sell the
Securities for sale to the public in all of the Qualifying
Jurisdictions in compliance with Canadian Securities Laws.
3. Distribution of Securities
--------------------------
3.1 The Agents shall solicit offers to purchase the Securities
for sale from the public, directly and through other members of the
selling group, in compliance with applicable Canadian Securities
Laws and upon the terms and conditions set forth in the Prospectus,
any Supplementary Material and this Agreement. The Agents shall not
solicit offers to purchase or sell the
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Securities so as to require registration of the Securities or the
filing of a prospectus, registration statement or other notice or
document with respect to the distribution of the Securities under
the laws of any jurisdiction other than the Qualifying Jurisdictions
and shall require each other member of the selling group to agree
with the Agents not to so solicit or sell. The Agents shall be
entitled to assume that the Securities are qualified for
distribution in any Qualifying Jurisdiction, unless the Agents
receive notice to the contrary from the Company or the applicable
Canadian Securities Commission. The Securities shall not be offered,
sold or delivered, directly or indirectly, in the United States or
to, or for the account or benefit of, a U.S. Person.
3.2 The Agents shall, after the Closing Date, use their best efforts
to complete the distribution of the Securities as promptly as
possible and MLCI shall notify the Company if and when, in its
opinion, the distribution of Securities has been completed and
shall, as soon as practicable thereafter (and in any event within
the time periods necessary to obtain a refund of filing fees),
provide the Company with a breakdown of the number of Securities
distributed in each of the Qualifying Jurisdictions where such
breakdown is required for the purpose of calculating fees payable to
the applicable Canadian Securities Commissions.
4. Representations and Warranties of the Company
---------------------------------------------
4.1 The Company represents and warrants to the Agents, as of the date
hereof and as of the Closing Time, and acknowledges that the Agents
are relying upon such representations and warranties in connection
with the entering into of this Agreement and the sale by the Agents,
on behalf of the Company, of the Securities, as follows:
(a) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware
with corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the
Prospectus; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify and be in good
standing would not have a material adverse effect on the condition,
financial or otherwise, or the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as
one enterprise.
(b) the Registration Statement has become effective under the 1933 Act;
(c) the Registration Statement and the U.S. Prospectus comply as to form
in all material respects with the requirements for registration
statements on Form S-3 under the 1933 Act and the rules and
regulations of the SEC thereunder, and the United States Securities
Exchange Act of 1934, as amended (the
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"1934 Act") and the documents incorporated by reference in the U.S.
Prospectus, at the time they were or hereafter are filed with the
SEC, complied or when so filed will comply, as the case may be, in
all material respects with the rules thereunder;
(d) the Company has complied in all material respects with all
requirements of the 1933 Act and the rules and regulations
thereunder with respect to the preparation and filing of the
Registration Statement;
(e) the Company meets the general eligibility requirements of NI 71-101
for use of a MJDS shelf prospectus with respect to the Securities,
as amended by an order dated June 30, 2004 issued by the Canadian
Securities Commissions providing, among other things, an exemption
from the limitations on distributions of derivative securities set
forth in subsection 3.3(1) of NI 71-101;
(f) the Canadian MJDS Prospectus conforms to the U.S. Shelf Prospectus
except for such deletions therefrom and additions thereto as are
permitted or required by NI 71-101;
(g) the Canadian MJDS Prospectus has been prepared and filed in
compliance in all material respects with Canadian Securities Laws;
(h) to the knowledge of the Company, none of the SEC, Canadian
Securities Commissions, any stock exchange in Canada or the United
States or any regulatory authority or court has issued an order
preventing or suspending the use or effectiveness, as the case may
be, of the Registration Statement or the Prospectus or preventing
the distribution of the Securities or instituted proceedings for
that purpose and no proceedings for that purpose are pending or are
contemplated by any of the aforementioned parties, and any request
on the part of such parties for additional information from the
Company has been complied with;
(i) the Company has prepared and filed with the Canadian Securities
Commissions a submission to jurisdiction and appointment of agent
for service of process on Form 71-101F1 on behalf of itself;
(j) the Trustee has prepared and filed with the Canadian Securities
Commissions a submission to jurisdiction and appointment of agent
for service on Form 71-101F1 on behalf of the Trustee;
(k) there has not occurred any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of
business, since the date of its most recent current report on Form
10-K, 10-Q or 8-K which has not been publicly disclosed;
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(l) this Agreement has been duly authorized, executed and delivered by
the Company and is legally binding upon the Company and is
enforceable against the Company in accordance with its terms,
subject to bankruptcy, insolvency and similar laws affecting the
rights of creditors generally, the qualification that equitable
remedies may be granted only in the discretion of a court of
competent jurisdiction and the qualification that the enforceability
of rights of indemnity and contribution may be limited by applicable
law;
(m) the Notes have been, or prior to the issuance of such Notes will
have been, duly authorized by the Company for issuance and sale
pursuant to this Agreement. The Notes, when issued and authenticated
by the Trustee in the manner provided for in the Indenture and
delivered against payment of the consideration therefor specified in
this Agreement, will constitute valid and legally binding
obligations of the Company, enforceable against the Company in
accordance with their terms and the terms of the Indenture, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors'
rights generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), and except further
as enforcement thereof may be limited by (A) requirements that a
claim with respect to any debt securities denominated other than in
U.S. dollars (or a foreign or composite currency judgement in
respect of such claim) be converted into U.S. dollars at a rate of
exchange prevailing on a date determined pursuant to applicable law
or (B) governmental authority to limit, delay or prohibit the making
of payments outside the United States, and such Notes will be in the
form contemplated by, and each registered holder thereof will be
entitled to the benefits of, the Indenture;
(n) the Indenture has been duly authorized, executed and delivered by
the Company and duly qualified under the United States Trust
Indenture Act of 1939, as amended and (assuming the due
authorization, execution and delivery by the Trustee), will
constitute a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors'
rights generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), and except further
as enforcement thereof may be limited by (A) requirements that a
claim with respect to any debt securities denominated other than in
U.S. dollars (or a foreign or composite currency judgement in
respect of such claim) be converted into U.S. dollars at a rate of
exchange prevailing on a date determined pursuant to applicable law
or (B) governmental authority to limit, delay or prohibit the making
of payments outside the United States;
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(o) the Warrants have been, or prior to the issuance of such Warrants
will be, duly authorized by the Company for issuance and sale
pursuant to this Agreement and the Warrants, when issued and
authenticated in the manner provided for in the Warrant Agreement
and delivered against payment of the consideration therefor
specified in this Agreement, will constitute valid and legally
binding obligations of the Company enforceable against the Company
in accordance with their terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law), and except further as enforcement thereof may be
limited by (A) requirements that a claim with respect to any warrant
payable other than in U.S. dollars (or a foreign or composite
currency judgment in respect of such claim) be converted into U.S.
dollars at a rate of exchange prevailing on a date determined
pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments outside the United States.
The Warrants will be in the form contemplated by, and each
registered holder thereof will be entitled to the benefits of, the
Warrant Agreement;
(p) the Warrant Agreement has been, or prior to the issuance of the
Warrants will have been, duly authorized, executed and delivered by
the Company and, upon such authorization, execution and delivery
(assuming the due authorization, execution and delivery by the
Warrant Agent), will constitute a valid and legally binding
agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law), and except further as enforcement thereof may be
limited by (A) requirements that a claim with respect to any warrant
payable other than in U.S. dollars (or a foreign or composite
currency judgment in respect of such claim) be converted into U.S.
dollars at a rate of exchange prevailing on a date determined
pursuant to applicable law or (B) governmental authority to limit,
delay or prohibit the making of payments outside the United States;
(q) the Warrants and the Notes being sold pursuant to this Agreement and
the Indenture and Warrant Agreement, as applicable, when issued and
delivered in accordance with their respective terms, will conform in
all material respects to the respective statements relating thereto
contained in the Prospectus;
(r) none of the execution and delivery by the Company of this Agreement,
the performance by the Company of its obligations hereunder or the
issuance and sale of the Securities will conflict with or result in
a breach of:
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(i) any statute, rule or regulation applicable to the Company;
(ii) the constating documents, by-laws or resolutions of the
directors or shareholders of the Company which are in effect at
the date hereof;
(iii) any mortgage, note, indenture, contract, agreement,
instrument, lease or other document to which the Company is a
party or by which it is bound; or
(iv) any judgment, decree or order binding the Company or the
property or assets of the Company;
which, in the case of the foregoing clauses (i), (iii) and (iv), may
have a material adverse effect on the Company;
(s) there are no actions, suits, proceedings or inquiries pending or, to
the best of the knowledge, information and belief of the Company,
threatened against or affecting the Company or any of its properties
or assets at law or in equity or before or by any governmental
agency or body, domestic or foreign, which may, in any way, have a
material adverse effect on the ability of the Company to perform its
obligations under this Agreement, the Securities, the Indenture or
the Warrant Agreement; and
(t) no filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required
for the performance by the Company of its obligations under this
Agreement, the Securities, the Indenture or the Warrant Agreement or
in connection with the transactions contemplated under this
Agreement, the Indenture or the Warrant Agreement, except such as
have been already obtained.
4.2 Any certificate signed by any officer of the Company or any of its
subsidiaries and delivered to any Agent or to counsel for the Agents
in connection with the offering of the Securities shall be deemed a
representation and warranty by the Company to each Agent as to the
matters covered thereby on the date of such certificate.
4.3 The delivery of the Prospectus, the Prospectus Supplement and the
delivery of any Supplementary Material to the Agents shall
constitute a representation and warranty by the Company in respect
of the Prospectus, Prospectus Supplement and any such Supplementary
Material that, as at the time of delivery:
(a) all information and statements (except information and statements
relating solely to or provided solely by the Agents) contained or
incorporated by reference in such documents:
(i) are true and correct in all material respects;
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(ii) contain no misrepresentation;
(iii) constitute full, true and plain disclosure of all material
facts relating to the Company and the Securities; and
(iv) omit no material fact or information (except facts or
information relating solely to the Agents) which is required to
be stated therein or is necessary to make the statements or
information contained therein not misleading in light of the
circumstances under which they were made;
(b) such document complies with the provisions of Canadian Securities
Laws; and
(c) such document filed in the French language in the Province of Quebec
is in all material respects a reasonable and proper translation of
the English language version thereof and that such versions are not
susceptible to any materially different interpretations with respect
to any material matter contained therein.
5. Covenants of the Company
------------------------
5.1 In further consideration of the agreements of the Agents herein
contained, the Company covenants with the Agents as follows:
(a) the Company will comply with the requirements of NI 71-101, file the
Final MJDS Supplement (in the English and French languages) with the
SEC and the Canadian Securities Commissions in accordance with Rule
424(b)(6) under the 1933 Act and NI 71-101 and in any event not
later than the date the Prospectus is first used in Canada and
obtain confirmation, to the extent such confirmation can be
obtained, of receipt thereof from the Canadian Securities
Commissions;
(b) the Company will, during the period of the distribution of the
Securities, notify the Agents promptly:
(i) of the filing of any amendment or supplement to the Prospectus;
(ii) of any request by any Canadian Securities Commission or the SEC
for any amendment of or supplement to the Registration
Statement or the Prospectus or for additional information;
(iii) of the institution or, to the extent known by the Company,
threatening by the SEC or any Canadian Securities Commission of
any stop order proceedings in respect of the Registration
Statement or the Prospectus, or any proceedings, with respect
to the suspension of the qualification of the Securities for
distribution in any
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jurisdiction or with respect to any order to cease trade any
securities of the Company in any jurisdiction; and
(iv) of any notification it has received from ▇▇▇▇▇'▇ Investors
Services Inc. of any downgrade in the rating assigned to the
Securities;
(c) the Company will use its reasonable commercial efforts to prevent
the issuance of any stop order, cease trading order or suspension
referred to in (b)(iii) above and to obtain as soon as possible the
lifting of any such stop order, cease trading order or suspension,
if issued;
(d) during the period of the distribution of the Securities, the Company
will not file any amendment to the Registration Statement or make or
file any amendment or supplement to the Prospectus of which the
Agents shall not have previously been advised or which the Agents
shall reasonably object in writing after being so advised; provided,
however, that this provision shall not prohibit the Company from
complying in a timely manner with (i) its timely disclosure and
other obligations under applicable securities legislation and the
requirements of any relevant stock exchange arising out of any
material change or change in material information or otherwise, and
(ii) its obligations under clause (f) below;
(e) the Company will furnish to the Agents, without charge, a signed
copy of the Prospectus and will use its reasonable best efforts to
promptly deliver after the execution of this Agreement and for so
long as delivery of a prospectus by an Agent may be required by the
1933 Act or Canadian Securities Laws, as many copies of the
Prospectus as the Agents may reasonably request;
(f) if, at any time during the period of distribution of the Securities,
any event shall occur or condition exist as a result of which it is
necessary, in the reasonable opinion of counsel for the Agents or
counsel for the Company, to further amend or supplement the
Prospectus in order that the Prospectus will not include a
misrepresentation or an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at
the time the Prospectus is delivered to a purchaser, or if it shall
be necessary, in the reasonable opinion of either such counsel, to
amend or supplement the Registration Statement or the Prospectus in
order to comply with the requirements of the 1933 Act or the
Canadian Securities Laws, the Company will forthwith prepare and
file with the SEC and the Canadian Securities Commissions, as
applicable, an appropriate supplement or amendment thereto and will
furnish to the Agents and to the dealers in the selling group (whose
names and addresses the Agents will furnish to the Company), such
number of copies thereof as the Agents may reasonably request; and
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(g) during the period of the distribution of the Securities, to allow
the Agents and the Agents' counsel to continue to conduct reasonable
due diligence necessary to fulfill the Agents' obligations under
Canadian Securities Laws.
6. Closing
-------
6.1 Subject as hereinafter provided, the closing of the Offering shall
be completed at the Closing Time at the offices of Canadian counsel
to the Company, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, ▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇.
6.2 At the Closing Time, and provided that all conditions precedent to
the completion of the Offering as stipulated in Section 7 of this
Agreement have been satisfied:
(a) the Company shall deliver (i) to CDS or its nominee, global
certificates representing such number of Notes and Warrants for
which the Agents have provided subscriptions on behalf of the
Company, such global certificates to be registered in the name of
CDS or its nominee, (ii) to the Agents, the requisite legal opinions
and certificates as provided for herein, and such further
documentation as may be contemplated herein; and
(b) the Agents shall pay to the Company, by wire transfer of immediately
available funds to a bank account designated by the Company, the
aggregate purchase price for the Securities in lawful money of
Canada, net of the Agents' Fee. The foregoing payment shall be made
against delivery of the Securities being purchased by the Agents to
CDS no later than the Closing Time, or at such other time or such
other date as shall be agreed to in writing between the Company and
the Agents.
7. Conditions and Closing Deliveries
---------------------------------
7.1 The Agents' obligations to solicit offers to purchase the Securities
as agents of the Company hereunder, including, without limitation,
those set out in Section 6.2, shall be subject to the conditions
(each of which is expressly declared to be solely for the benefit of
the Agents) (i) that the terms and conditions of the Securities
described in the Prospectus and the Prospectus Supplement shall
conform to the description thereof in such documents; (ii) that the
Prospectus and Prospectus Supplement shall not contain a
misrepresentation; and (iii) that:
(a) at the Closing Date, no order having the effect of ceasing or
suspending the distribution of the Securities or the trading in any
of the securities of the Company, including a stop order suspending
the effectiveness of the Registration Statement, shall have been
issued by the SEC or any Canadian Securities Commission or stock
exchange in Canada or the United States and no proceedings for that
purpose shall have been instituted or pending or, to the knowledge
of the Company, shall be contemplated by the SEC,
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any Canadian Securities Commission or stock exchange in Canada or
the United States; and any request on the part of the SEC or any
Canadian Securities Commission for additional information from the
Company shall have been complied with. The Final MJDS Supplement
shall have been filed with the SEC in accordance with Rule 424(b)(6)
under the 1933 Act and with the Canadian Securities Commissions in
accordance with NI 71-101;
(b) the Agents shall have received on the Closing Date a certificate,
dated the Closing Date and signed by an authorized officer of the
Company, in his or her capacity as such, to the effect that:
(i) the representations and warranties of the Company contained in
this Agreement are true and correct in all material respects as
of the Closing Date with the same force and effect as if made
at and as of the Closing Time;
(ii) the Company has complied in all material respects with all the
terms and conditions of this Agreement on its part to be
complied with up to the Closing Time; and
(iii) subsequent to the respective dates as of which information is
given in the Registration Statement, there has not been any
material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of
business, which requires disclosure under the timely disclosure
provisions of U.S. securities laws applicable to the Company,
except as has been publicly disclosed;
(c) the Agents shall have received on the Closing Date the following the
opinions:
(i) an opinion of ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, Canadian
counsel to the Company, to the effect that the French language
version of each of the Prospectus and Prospectus Supplement
(excluding all documents incorporated by reference therein) are
in all material respects complete and proper translations of
the English language versions thereof;
(ii) an opinion of the Auditors, to the effect that the French
language version of the financial portions of the Prospectus
and Prospectus Supplement and the documents incorporated by
reference therein are, in all material respects, a complete and
proper translation of the English language versions thereof;
(iii) an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, to the effect that the
French language version of the non-financial portions of the
documents
Page 14
incorporated by reference in the Prospectus and Prospectus
Supplement are, in all material respects, a complete and proper
translation of the English language versions thereof;
(iv) an opinion of ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP addressed to
the Agents, substantially in the form of Schedule A hereto;
provided that in providing such opinion, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP may rely on the opinions of local counsel as to
matters governed by the laws of jurisdictions other than the
laws of the Provinces of Ontario and Quebec and the federal
laws of Canada applicable therein;
(v) an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP, United States
counsel for the Company, addressed to the Agents, substantially
in the form of Schedule B hereto; and
(vi) an opinion of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLP, counsel for the Agents,
substantially in the form of Schedule C hereto; and
(d) in connection with their review of the Prospectus, the Auditors
shall have furnished a comfort letter to the Company and the Agents,
in form and substance satisfactory to the Company and the Agents
acting reasonably, relating to the verification of financial
information and accounting data contained in the Prospectus
(including information incorporated therein by reference) relating
to the Company and matters involving changes or developments since
the respective dates as of which specified financial information is
given in the Prospectus and Prospectus Supplement to a date not more
than five days prior to the date of such letter. Such letter shall
further state that (i) the Auditors are independent with respect to
the Company within the meaning of the 1933 Act and the regulations
thereunder, and (ii) in their opinion, the audited financial
statements of the Company included or incorporated by reference in
the Registration Statement and the Prospectus comply as to form in
all material respects with the applicable accounting requirements of
the 1933 Act and the regulations thereunder.
Page 15
8. Termination
-----------
8.1 If prior to the Closing Time:
(a) there has been any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of
business, which, in the reasonable opinion of the Agents, would
reasonably be expected to have a significant adverse effect on the
market price or value of the Securities;
(b) any enquiry, action, suit, investigation or other proceeding,
whether formal or informal, in relation to the Company or the
distribution of the Securities should be instituted or any order
under or pursuant to any laws or regulations of the United States or
of any of the Qualifying Jurisdictions or by any relevant stock
exchanges in the United States or Canada or any other regulatory or
governmental authority in the United States or should be made or
issued (except for any such order based upon the activities or the
alleged activities of the Agents and not of the Company) which, in
the reasonable opinion of the Agents, operates to prevent or
restrict the trading or the distribution of the Securities or which
has a material adverse impact on the marketability thereof; or
(c) there should develop, occur or come into effect or existence any
event, action, state, condition or occurrence of national or
international consequence, including any act of terrorism, war or
like event, or any law or regulation, which in the opinion of the
Agents, acting reasonably, seriously adversely affects, or would
seriously adversely affect the Canadian, United States or
international financial markets such that it would be impractical in
the reasonable opinion of the Agents to sell the Securities,
then, in any one or more of the foregoing cases, each of the Agents
shall be entitled, at its or their sole option, to terminate all of
its obligations under this Agreement, and the obligations of any
purchaser from whom the Agent has solicited an order to purchase
Securities, by notice to that effect delivered to the Company prior
to the Closing Time; provided, however, that if NBF terminates its
obligations hereunder and the Company otherwise fails to comply with
the requirements of National Instrument 33-105 - Underwriting
Conflicts, all of the obligations of the Agents under this
Agreement, and the obligations of any purchaser from whom the Agents
have solicited an order to purchase Securities, shall terminate
without any further act or formality.
8.2 The rights of the Agents to terminate their obligations hereunder
are in addition to any other remedies they may have in respect of
any default, act or failure to act of the Company, in respect of any
of the matters contemplated hereby. In the event of any termination,
there shall be no
Page 16
further liability on the part of the Company to the terminating
Agent or persons from whom it has solicited orders except in respect
of any liability which may have arisen or may thereafter arise under
Sections 9.1 or Section 10. Each of the Agents may waive, in whole
or in part, or extend the time for compliance with, any terms and
conditions without prejudice to its rights in respect of any other
terms and conditions or any other or subsequent breach or
non-compliance provided, however, that any waiver or extension must
be in writing and signed by the Agent in order to be binding upon
it.
9. Expenses of Offering and Agents' Expenses
-----------------------------------------
9.1 Whether or not any sale of the Securities shall be completed, the
Company (or any of its affiliates) shall pay all reasonable expenses
relating to this transaction and all other costs and expenses of or
incidental to the creation, offering, issue, sale and delivery of
the Securities including, without limitation, the Agents' reasonable
out-of-pocket expenses relating directly and solely to this
transaction up to $65,000 (including, without limitation, the
reasonable fees and disbursements of counsel up to $60,000 and
travel expenses relating to information meetings), the advertising
and marketing expenses relating to the Offering (including all
roadshow expenses), the cost of preparing and printing and
translating the Prospectus, Prospectus Supplement, any Supplementary
Material, any sales memorandum and the certificates for the
Securities, the cost of qualifying the Securities for sale to the
public in the Qualifying Jurisdictions, the fees and expenses of the
Company, the cost of registration and delivery of certificates for
the Securities and the fees and expenses of the Auditors, counsel
and all local counsel of the Company, including all legal and
accounting fees and expenses relating to the Prospectus and
preparing the Company for the Offering.
10. Indemnification and Contribution
--------------------------------
10.1 The Company shall indemnify each of the Agents for and on behalf
of itself and for and on behalf of and in trust for its directors,
officers, employees and agents (each such Agent, director, officer,
employee and agent being referred to individually as an "Indemnified
Party") from and against any and all liabilities, claims, demands,
losses, costs, damages and expenses (including reasonable legal fees
but excluding loss of profits) (collectively, "losses") to which it
or they or any of them may be subject or may suffer, incur or be
required to pay, in connection with the transactions contemplated by
this Agreement, whether directly or indirectly in consequence of:
(a) any breach of or default under any representation, warranty,
covenant or agreement of the Company in this Agreement or in any
covenant or other document of the Company delivered pursuant hereto
or made by the
Page 17
Company in connection with the issuance, distribution or sale by the
Company of the Securities;
(b) any misrepresentation or alleged misrepresentation contained in the
Prospectus, or in any amendment in respect thereof, or any untrue
statement or alleged untrue statement of a material fact contained
in the Registration Statement (or any amendment thereto), or the
omission or alleged omission therefrom of a material fact necessary
to make the statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a material fact
included in the Prospectus (or any amendment or supplement thereto)
or the omission or alleged omission therefrom of a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, unless
such misrepresentation or untrue statement or omission or such
alleged untrue statement or omission was made in reliance upon and
in conformity with written information furnished to the Company by
the Agent expressly for use in the Registration Statement or the
Prospectus;
(c) any order made, or any inquiry, investigation or proceeding
threatened or commenced, by any securities commission or other
competent regulatory authority based upon an untrue statement or
omission, or alleged untrue statement or omission, a
misrepresentation or an allegation that any such misrepresentation
exists in the Prospectus, the Prospectus Supplement or any
Supplementary Material (other than one which relates solely to the
Agents or any one of them) which restricts or prevents trading in,
or distribution of, the Securities in any Qualifying Jurisdiction;
(d) any negligence or wilful misconduct by the Company relating to or
connected with the sale by the Company of the Securities; or
(e) the non-compliance or alleged non-compliance by the Company with any
Canadian Securities Laws in relation to the Offering,
provided, however, that this indemnity may not be relied upon by any
Indemnified Party in respect of any losses which result from any
wilful misconduct or gross negligence in the performance of any of
the provisions contained herein by such Indemnified Party.
If any matter or thing contemplated by this Section 10.1 shall be
asserted against an Indemnified Party, such Indemnified Party shall
notify the Company as soon as possible of the nature of such claim
and the Company shall be entitled (but not required) to assume the
defence of any suit brought to enforce such claim; provided,
however, that no settlement may be made by the Company or the
Indemnified Party without the prior written consent of the others of
them, which consent shall not be unreasonably withheld.
Page 18
In any such claim, the Indemnified Party shall have the right to
retain other counsel to act on his or its behalf, provided that the
fees and disbursements of such other counsel shall be paid by the
Indemnified Party unless (i) the Company and the Indemnified Party
shall have mutually agreed to the retention of the other counsel or
(ii) counsel representing or proposed to represent each of the
Company and the Indemnified Party, upon the inquiry of the Company
or the Indemnified Party or of its own initiative, is of the opinion
that the representation of such parties by the same counsel would be
inappropriate due to the actual or potential differing interests
between them, in which event such fees and disbursements shall be
paid by the Company to the extent that they have been reasonably
incurred.
10.2 In order to provide for just and equitable contribution in
circumstances in which the indemnity provided for in Section 10.1
is, for any reason of policy or otherwise, held to be unavailable
from the Company, the Agents and the Company shall contribute to the
aggregate losses of the nature contemplated by the said indemnity
incurred by the Company and the Indemnified Parties in such
proportion as is appropriate to reflect not only the relative
benefits received by the Indemnifying Parties on the one hand and
the Agents on the other hand, but also the relative fault of the
Indemnifying Parties on the one hand and the Agents on the other
hand in connection with the misrepresentation, order, investigation,
proceeding or other matter referred to in Section 10.1; provided,
however, that no person guilty of negligence or wilful misconduct in
the performance of any of the provisions hereof or fraudulent
misrepresentation shall be entitled to contribution from any person
who is not guilty of the same and provided that in no case shall an
Agent be responsible for any amount in excess of the Agents' Fee
actually received and retained by such Agent. For the purposes of
this paragraph, each party shall give prompt notice to the other
parties of any action, suit or proceeding threatened or commenced in
respect of which a claim for contribution may be made under this
paragraph. The rights to contribution set out in this Section 10.2
are in addition to, and without prejudice to, any other right to
contribution which any Indemnified Party may have.
10.3 Each of the Agents, severally on its own behalf and not jointly,
shall indemnify and save the Company, its directors, each of the
officers who signed the Registration Statement and Prospectus and
each person or company, if any, who controls the Company within the
meaning of Section 15 of the 1933 Act harmless against and from any
loss (other than loss of profits) which the Company may incur by
reason of such Agent's failure to comply with any of its obligations
under this Agreement including any breach of, or default under, any
representation, warranty or covenant of such Agent in this Agreement
or any other document to be delivered in connection with the
carrying out of the transactions contemplated herein subject to the
same procedures applicable to indemnification and contribution as
provided in Sections 10.1 and 10.2, mutatis mutandis.
Page 19
10.4 The rights of indemnity and contribution contained in Sections 10.1
and 10.2 in respect of a particular claim based on misrepresentation
or omission or alleged misrepresentation or omission in the
Prospectus or any Supplementary Material shall not apply if the
Company has complied with Sections 5.1(e) and 5.1(f) and the person
asserting such claim was not provided with a copy of the Prospectus,
Prospectus Supplement or any Supplementary Material which corrected
such misrepresentation or omission by an Agent or other selling
group member within two Business Days after commercial copies of the
Prospectus or any Supplementary Material were provided to the Agents
or other selling group members in accordance with Sections 5.1(e)
and 5.1(f).
10.5 The Company and each of the Agents agree that the obligations of
the Agents hereunder are several and not joint or joint and several.
11. Notices
-------
11.1 Unless herein otherwise expressly provided, any notice, request,
direction, consent, waiver, extension, agreement or other
communication required or permitted to be given hereunder shall be
in writing and shall be delivered by personal delivery to an officer
of the party to whom notice is given or shall be sent by commercial
courier to the attention of the individuals noted below, in each
case at the following address:
(a) To the Company:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., Inc.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
- and -
Davies ▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
Page 20
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
(b) To MLCI:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Canada Inc.
Suite 400, BCE Place
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
Attention: ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
(c) To NBF:
National Bank Financial Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
McMillan ▇▇▇▇▇ LLP
Barristers & Solicitors
BCE Place, Suite ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
The parties hereto may change their respective address for notice by notice
given in the manner aforesaid.
12. General Provisions
------------------
12.1 Time shall be of the essence hereof.
12.2 This Agreement shall be governed by and construed, performed and
interpreted in accordance with the laws of the Province of Ontario
and the laws of Canada applicable therein and the courts of such
province shall have non-exclusive jurisdiction over any dispute
hereunder.
Page 21
12.3 The representations, warranties, obligations, covenants, agreements
and indemnities herein contained or contained in any certificate
delivered pursuant to this Agreement shall survive the sale of the
Securities and shall continue in full force and effect unaffected by
the termination of the obligations of the Agents hereunder, nor
shall they be limited or prejudiced by any investigation made by or
on behalf of any Agent in the course of preparation of the
Prospectus or any Supplementary Material or the sale of the
Securities.
12.4 If any provision of this Agreement is determined to be void or
unenforceable in whole or in part, such void or unenforceable
provision shall not affect or impair the validity of any other
provision of this Agreement and shall be severable from this
Agreement.
12.5 This Agreement may not be assigned by any of the parties hereto
without the prior written consent of the other parties hereto. This
Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted
assigns.
12.6 This Agreement may be executed in several counterparts each of which
when so executed shall be deemed to be an original, and such
counterparts shall constitute one and the same instrument; and
notwithstanding the date of execution, this Agreement shall be
deemed to bear the date first shown on this Agreement.
12.7 This Agreement may be executed and delivered by the parties hereto
by facsimile transmission and such facsimile copy, when received,
shall constitute an original hereof.
12.8 The Company shall be entitled to make any delivery or give any
disclosure or notice that is to be given to the Agents hereunder to
MLCI on their behalf and shall act on any notice, waiver, extension,
receipt or other communication given by or on behalf of the Agents
by MLCI which shall represent the Agents and which shall have
authority to bind the Agents in respect of all matters hereunder,
except matters referred to in Sections 10.1 through 10.3. MLCI shall
use its reasonable best efforts to consult fully with the other
Agent with respect to any such notice, waiver, extension or other
communication.
12.9 The parties hereto shall provide all such reasonable assurances as
may be required or desirable to consummate the transactions
contemplated hereby and each party shall provide such further
documents or instruments required by any other party as may be
reasonably necessary or desirable to effect the purpose of this
Agreement and to carry out its provisions.
Page 22
If the foregoing is in accordance with your understanding and is agreed to by
you, please signify your acceptance on the accompanying counterparts of this
letter and return the same to the undersigned, whereupon this letter as so
accepted shall constitute an agreement among the Company and the Agents in
accordance with the foregoing.
Yours very truly,
▇▇▇▇▇▇▇ ▇▇▇▇▇ CANADA INC.
by
-----------------------------------
Name:
Title:
by
-----------------------------------
Name:
Title:
NATIONAL BANK FINANCIAL INC.
by
-----------------------------------
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO., INC.
by
---------------------------------
Name:
Title:
SCHEDULE A
FORM OF OPINION OF CANADIAN COUNSEL TO THE COMPANY
--------------------------------------------------
See attached.
SCHEDULE B
FORM OF OPINION OF U.S. COUNSEL TO THE COMPANY
----------------------------------------------
See attached.
SCHEDULE C
FORM OF OPINION OF COUNSEL TO THE AGENTS
----------------------------------------
See attached.
