SUPPORT AGREEMENT
Exhibit 99.4
This SUPPORT AGREEMENT (this “Agreement”) is made and entered into as of June 5, 2006
between Grace Holdings LLC, a Delaware limited liability company (“Parent”), 4162862 Canada
Limited, a Canadian corporation and an indirect wholly owned subsidiary of Brookfield Properties
Corporation (“AcquisitionCo”), on the one hand, and P. M. Capital Inc.
(“Shareholder”), on the other hand. Capitalized terms used and not otherwise defined
herein shall have the respective meanings set forth in the Merger Agreement described below.
W I T N E S S E T H:
WHEREAS, pursuant to an Agreement and Plan of Merger and Arrangement Agreement dated as of
June 5, 2006 by and among Parent, Grace Acquisition Corporation, AcquisitionCo, Trizec Canada,
Inc., a Canadian corporation (“TZ Canada”), and the other parties signatory thereto (the
“Merger Agreement”), Parent has agreed to acquire the outstanding securities of TZ Canada
pursuant to a plan of arrangement;
WHEREAS, as a condition to the willingness of Parent and AcquisitionCo to enter into the
Merger Agreement and as an inducement and in consideration therefor, the Shareholder has agreed to
enter into this Agreement;
WHEREAS, Shareholder is the registered holder of 7,522,283 multiple voting shares
(“Multiple Voting Shares”) and 1,972,435 subordinate voting shares (“Subordinate Voting
Shares” and, together with the Multiple Voting Shares, the “Shares”) of TZ Canada; and
WHEREAS Shareholder, Xxxxx Xxxx, TZ Canada and CIBC Mellon Trust Company are parties to a
trust agreement (“Trust Agreement”) dated April 23, 2002;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements
herein contained, and intending to be legally bound hereby, the parties hereby agree as follows:
1. Agreement to Retain Subject Shares.
1.1. Prior to the Expiration Date (as defined below), Shareholder shall not: (a) transfer,
assign, sell, gift-over, pledge, encumber or otherwise dispose of, or consent to any of the
foregoing with respect to, any or all of the Subject Shares or any right or interest therein
(“Transfer”); (b) enter into any contract, option or other agreement, arrangement or
understanding with respect to any Transfer; (c) grant any proxy, power-of-attorney or other
authorization or consent with respect to any of the Subject Shares (other than the proxy
contemplated in Section 3 herein); (d) deposit any of the Subject Shares into a voting trust, or
enter into a voting agreement or arrangement with respect to any of the Subject Shares (other than
with respect of the Trust Agreement); or (e) take any action that would make any representation or
warranty of Shareholder contained herein untrue or incorrect or have the effect
of preventing or disabling Shareholder from performing its obligations under this Agreement.
Notwithstanding the foregoing or anything else in this Agreement to the contrary, Shareholder
may transfer the Subject Shares to a corporation or other entity directly or indirectly wholly-owned by
Xxxxx Xxxx (the “Transferee”) provided that the Transferee shall have agreed in form and on terms
satisfactory to Parent, acting reasonably, to become bound by this Agreement in the same manner as
Shareholder. As used herein, the term “Expiration Date” shall mean the earlier to occur of
(x) the Plan of Arrangement Effective Time, (y) the date of termination of the Merger Agreement in
accordance with Section 10.01 thereof or (z) the date on which there has been a TZ Canada Change of
Recommendation (whether or not the Merger Agreement has been terminated).
1.2. “New Shares” means:
(a) any shares of capital stock, voting interests or ownership interests in TZ Canada that
Shareholder, directly or indirectly, purchases or with respect to which Shareholder otherwise
acquires beneficial ownership or sole or shared voting or dispositive power (whether through the
exercise of any options, warrants or other rights to purchase shares, voting interests or ownership
interests in TZ Canada) after the date of this Agreement and prior to the Expiration Date; and
(b) any shares of capital stock, voting interests or ownership interests in TZ Canada of which
Shareholder, directly or indirectly, becomes the beneficial or record owner (whether as a result of
any change in the shares, voting interests or ownership interests in TZ Canada by reason of a stock
dividend, stock split, split-up, recapitalization, reorganization, business combination,
consolidation, exchange of shares or interests, or any similar transaction or other change in the
capital structure of TZ Canada).
1.3. “Subject Shares” means the Shares and the New Shares.
2. Agreement to Vote Subject Shares and Take Certain Other Action.
2.1. Prior to the Expiration Date, at every meeting of the shareholders of TZ Canada, however
called, at which any of the following matters is considered or voted upon, and at every adjournment
or postponement thereof, and on every action or approval by written consent of the shareholders of
TZ Canada with respect to any of the following matters, Shareholder shall vote or give written
consent or cause the holder of record to vote or give written consent with respect to the Subject
Shares:
(a) in favor of approval and adoption of the Plan of Arrangement and the transactions
contemplated thereby;
(b) against approval of any proposal made in opposition to or competition with consummation of
the Plan of Arrangement;
(c) against approval of any TZ Canada Acquisition Proposal from any party other than Parent or
an affiliate of Parent as contemplated by the Merger Agreement;
(d) against any action or proposal that is intended to, or is reasonably likely to, result in
the conditions of TZ Canada’s obligations under the Merger Agreement not being fulfilled;
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(e) against any amendment of the TZ Canada Charter or By-laws that is not requested or
expressly approved by Parent;
(f) any action which would reasonably be expected to impede, interfere with, delay, postpone
or materially adversely affect consummation of the transactions contemplated by the Plan of
Arrangement; and
(g) against any dissolution, liquidation or winding up of TZ Canada.
It is understood and agreed that the Multiple Voting Shares are subject to and will be voted
in accordance with the terms of the Trust Agreement.
2.2. Prior to the Expiration Date, Shareholder shall be present, in person or by proxy, at all
meetings of shareholders of TZ Canada at which any of the matters referred to in Section 2.1 is to
be voted upon so that all Subject Shares are counted for the purposes of determining the presence
of a quorum at such meetings.
2.3. Between the date of this Agreement and the Expiration Date, Shareholder will not, and
will not permit, in its capacity as a shareholder, any entity under Shareholder’s control to, (a)
solicit proxies or become a “participant” in a “solicitation,” (as such terms are defined in Rule
14A under the Exchange Act) with respect to an Opposing Proposal (as defined below) (b) initiate a
shareholders’ vote with respect to an Opposing Proposal or (c) become a member of a “group” (as
such term is defined in Section 13(d) of the Exchange Act) with respect to any voting securities of
TZ Canada with respect to an Opposing Proposal. For purposes of this Agreement, the term
“Opposing Proposal” means any of the actions or proposals described in clauses (b) through
(g) of Section 2.1, along with any proposal or action which would, or could reasonably be expected
to, impede, frustrate, prevent, prohibit or discourage any of the transactions contemplated by the
Merger Agreement. The foregoing shall not apply to any action otherwise permitted to be taken by
or on behalf of any entity under Shareholder’s control pursuant to the Merger Agreement.
3. Grant of Irrevocable Proxy Coupled with an Interest.
3.1. Shareholder hereby revokes any and all other proxies or powers of attorney in respect of
any Subject Shares and agrees that during the period commencing on the date hereof and for so long
as this Agreement has not been terminated in accordance with Section 6 hereof, Shareholder hereby
irrevocably appoints Brookfield Properties Corporation or any individual designated by Brookfield
Properties Corporation, and each of them, as Shareholder’s agent, attorney-in-fact and proxy (with
full power of substitution and resubstitution), for and in the name, place and stead of
Shareholder, to vote (or cause to be voted) the Subject Shares held of record by Shareholder, in
the manner set forth in Section 2, at any meeting of the shareholders of TZ Canada, however called,
or in connection with any written consent of the shareholders of TZ Canada.
3.2. Shareholder hereby affirms that the proxy set forth in this Section 3 is irrevocable, is
coupled with an interest, and is granted in consideration of Parent and AcquisitionCo entering into
the Merger Agreement.
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3.3. The vote of the proxyholder shall control in any conflict between the vote by the
proxyholder of Shareholder’s Subject Shares and a vote by Shareholder of its Subject Shares.
4. Representations, Warranties and Covenants of Shareholder. Shareholder hereby
represents, warrants and covenants to Parent and AcquisitionCo as follows:
4.1. (a) Shareholder is the beneficial and registered holder of the Shares; (b) the Subject
Shares set forth on the signature page hereto constitute Shareholder’s entire interest in the
outstanding capital stock and voting securities of TZ Canada as of the date hereof; (c) the Subject
Shares are, and will be, at all times up until the Expiration Date, free and clear of any options,
proxies, voting trusts (other than the Trust Agreement), rights, understandings or arrangements, or
exercise of any rights of a shareholder in respect of the Subject Shares and, prior to the TZ
Canada Shareholders Meeting, will be free and clear of any liens, claims, charges, security
interests or other encumbrances; (d) subject to the terms and conditions of the Trust Agreement
with respect to the Multiple Voting Shares, Shareholder has the sole voting power and sole power of
disposition with respect to all of the Subject Shares outstanding on the date hereof, and will have
sole voting power and sole power of disposition with respect to all of the Subject Shares acquired
by Shareholder after the date hereof; and (e) Shareholder’s principal place of business is
accurately set forth on the signature page hereto.
4.2. Shareholder has full power (corporate or otherwise) to execute and deliver this Agreement
and to comply with and perform Shareholder’s obligations hereunder. This Agreement has been duly
and validly executed and delivered by Shareholder and constitutes the valid and binding obligation
of Shareholder, enforceable against Shareholder in accordance with its terms. The execution and
delivery of this Agreement by Shareholder does not, and the performance of Shareholder’s
obligations hereunder will not, (a) conflict with or violate any organizational documents of
Shareholder or any law, statute, rule, regulatory order, writ, judgment or decree applicable to
Shareholder or the Subject Shares, or (b) result in any breach of or constitute a default (or an
event that with notice or lapse of time or both would become a default) under, or give to others
any right to terminate, amend, accelerate or cancel any right or obligation under, or result in the
creation of any lien or encumbrance on any Subject Shares pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation
to which Shareholder is a party or by which Shareholder or the Subject Shares are or will be bound
or affected. The execution and delivery of this Agreement by Shareholder does not, and the
performance of this Agreement by Shareholder does not and will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental or regulatory
authority by Shareholder, and except where the failure to obtain such consents, approvals,
authorizations or permits, or to make such filings or notifications, could not prevent or delay the
performance by Shareholder of its obligations under this Agreement in any material respect.
4.3. Shareholder understands and agrees that if Shareholder attempts to Transfer, vote or
provide any other person directly or indirectly with the authority to vote any of the Subject
Shares, other than in compliance with this Agreement, Shareholder hereby unconditionally and
irrevocably instructs TZ Canada not to, (a) permit any such Transfer on its books and records, (b)
issue a new certificate representing any of the Subject Shares or (c) record such vote unless and
until Shareholder shall have complied with the terms of this Agreement.
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4.4. Notwithstanding any other provision of this Agreement, the Shareholder may convert to SVS
and sell or transfer upto 3,000,000 MVS which thereafter shall not form part of the Subject Shares.
5. Further Assurances; Additional Documents. Shareholder shall covenant on Closing in
favour of AcquisitionCo that neither Shareholder, Xxxxx Xxxx, nor any corporation controlled (as
such term is used for the purposes of the Income Tax Act (Canada)) by Xxxxx Xxxx, will acquire
shares of TZ Canada, AcquisitionCo, Brookfield Properties Corporation or Brookfield Asset
Management Inc., other than pursuant to the Plan of Arrangement or as otherwise contemplated by the
within transaction, for a period of 12 months after Closing. Shareholder hereby covenants and
agrees to execute and deliver any additional documents necessary, in the reasonable opinion of
Parent, to carry out the intent of this Agreement.
6. Termination. This Agreement and all obligations of Shareholder hereunder shall
terminate and shall have no further force or effect as of the Expiration Date.
7. Severability. If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not affected in any manner
materially adverse to either party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, this Agreement shall automatically be deemed to be
modified so as to effect the original intent of the parties as closely as possible in order that
the transactions contemplated hereby be consummated as originally contemplated to the greatest
extent possible.
8. Binding Effect and Assignment. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement shall be assigned, in whole or in part, by operation
of law or otherwise by any party without the prior written consent of the other party;
provided, however, Parent may, in its sole discretion, assign its rights and
obligations hereunder to any direct or indirect wholly owned subsidiary of Parent. Any assignment
in violation of the preceding sentence shall be void. Subject to the preceding sentences, this
Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.
9. Amendment and Modification. This Agreement may not be amended, modified or
supplemented except by an instrument in writing signed on behalf of each of the parties.
10. Specific Performance; Injunctive Relief. The parties hereto acknowledge that
Parent will be irreparably harmed and that there will be no adequate remedy at law for a violation
of any of the covenants or agreements of Shareholder set forth herein. Therefore, it is agreed
that, in addition to any other remedies that may be available to Parent upon any such
violation, Parent shall have the right to enforce such covenants and agreements by specific
performance, injunctive relief or by any other means available to Parent at law or in equity and
Shareholder hereby waives any and all defenses which could exist in its favor in connection with
such enforcement and waives any requirement for the security or posting of any bond in connection
with such enforcement.
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11. Notices. All notices, requests, claims, demands and other communications under
this Agreement shall be in writing and shall be deemed given if delivered personally, via facsimile
(which is confirmed) or sent by overnight courier (providing proof of delivery) to the parties at
the following addresses (or at such other address for a party as shall be specified by like
notice):
(a) If to Shareholder, at the address set forth below Shareholder’s signature at the end
hereof.
(b) if to Parent or AcquisitionCo, to:
Brookfield Properties Corporation
Xxxxx Xxxxx Xxxxxxxxx Xxxxxx
XX, XX 00000-0000
Telecopier: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx
Attention: Xxxxxxx X. Xxxxx
or to such other address as any party hereto may designate for itself by notice given as herein
provided.
12. Expenses. Each party hereto shall pay its own expenses incurred in connection
with this Agreement.
13. Governing Law. This Agreement shall be governed by, and construed in accordance
with, the laws of the province of Ontario, Canada, regardless of the laws that might otherwise
govern under applicable principles of conflict of laws thereof.
14. No Waiver. The failure of any party to this Agreement to exercise any right,
power or remedy provided under this Agreement or otherwise available in respect hereof at law or in
equity, or to insist upon compliance by any other party hereto with its obligations hereunder, and
any custom or practice of the parties at variance with the terms hereof, shall not constitute a
waiver by such party of its right to exercise any such or other right, power or remedy or to demand
such compliance.
15. Jurisdiction; Venue. Any litigation or other court proceeding with respect to any
matter arising from or in connection with this Agreement shall be conducted in the courts of the
Province of Ontario and courts competent to hear appeals therefrom and each party to this Agreement
hereby submits to jurisdiction and consents to venue in such courts.
16. Waiver of Trial by Jury. Each party to this Agreement hereby waives its right to
a trial by jury in any litigation or other court proceeding by any party to this Agreement against
any other party to this Agreement with respect to any matter arising from or in connection
with this Agreement.
17. Entire Agreement; No Third-Party Beneficiaries. This Agreement (a) constitutes
the entire agreement, and supersedes all prior agreements and understandings, both written and
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oral, among the parties with respect to the subject matter of this Agreement and (b) is not
intended to confer upon any Person other than the parties any rights or remedies.
18. Counterpart. This Agreement may be executed by facsimile signature and in one or
more counterparts, all of which shall be considered one and the same agreement and shall become
effective when one or more counterparts have been signed by each of the parties and delivered to
the other parties.
19. Effect of Headings. The section headings herein are for convenience only and
shall not affect the construction or interpretation of this Agreement.
* * * *
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties have caused this Voting Agreement to be executed and delivered as
of the date first above written.
GRACE HOLDINGS LLC |
/s/ Xxxxxxx X. Xxxxx |
Its:
CEO |
4162862 Canada Limited |
/s/ Xxxxxxx X. Xxxxx |
Its:
CEO |
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[SUPPORT AGREEMENT SIGNATURE PAGE]
| P.M. Capital Inc., an entity organized under the laws of Canada |
||||
| By: | /s/ Xxxxx Xxxxx | |||
| Name: | Xxxxx Xxxxx | |||
| Title: | Vice President | |||
Notice Address:
c/o Clover Administration Inc.
000 Xxxxxxxx Xxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx X0X 0X0
Subject capital stock, voting interests or ownership interests of TZ Canada on the date hereof:
7,522,283 Multiple Voting Shares
1,972,435 Subordinate Voting Shares
0 shares of capital stock issuable upon the exercise of outstanding options, warrants or other
rights.
Place of Organization: Ontario, Canada
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