Exhibit 10.32
================================================================================
SHARE PURCHASE AGREEMENT
BETWEEN
GLACIER VENTURES INTERNATIONAL CORP.
AND
HCPH CANADIAN NEWSPAPER HOLDINGS CO.
AND
XXXXXXXXX INTERNATIONAL INC.
MADE AS OF
DECEMBER 19, 2005
SALE OF SHARES OF 3120575 NOVA SCOTIA COMPANY
================================================================================
XXXXXXXX XXXXXXXX LLP
TABLE OF CONTENTS
SHARE PURCHASE AGREEMENT
ARTICLE 1 - INTERPRETATION................................................. 2
1.01 Definitions.................................................... 2
1.02 Knowledge...................................................... 6
1.03 Headings....................................................... 6
1.04 Extended Meanings.............................................. 6
1.05 Accounting Principles.......................................... 7
1.06 Currency....................................................... 7
1.07 Schedules...................................................... 7
ARTICLE 2 - PURCHASE AND SALE.............................................. 7
2.01 Purchase and Sale and Purchase Price........................... 7
2.02 Closing and Deliverables....................................... 7
2.03 Guarantee...................................................... 8
2.04 Taxes.......................................................... 8
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES................................. 9
3.01 Vendor's Representations and Warranties........................ 9
3.02 Survival of Vendor's and Xxxxxxxxx International's
Representations, Warranties and Covenants...................... 12
3.03 Purchaser's Representations and Warranties..................... 13
3.04 Survival of Purchaser's Representations, Warranties
and Covenants.................................................. 14
3.05 Investigation.................................................. 14
3.06 No Inducement or Reliance; Independent Assessment.............. 14
3.07 Release........................................................ 14
ARTICLE 4 - COVENANTS...................................................... 15
4.01 Appropriate Action; Consents; Filings.......................... 15
4.02 Preservation of Books and Records.............................. 16
4.03 Tax Matters.................................................... 16
4.04 Mail; Payments................................................. 17
4.05 Xxxxxxxxx Pre-Closing Reorganization Steps..................... 17
ARTICLE 5 - CONDITIONS..................................................... 17
5.01 Conditions to Obligations of Each Party........................ 17
5.02 Conditions for the Benefit of the Purchaser.................... 18
5.03 Conditions for the Benefit of the Vendor....................... 19
-ii-
ARTICLE 6 - INDEMNIFICATION................................................ 19
6.01 Indemnification................................................ 19
ARTICLE 7 - TERMINATION.................................................... 25
7.01 Termination.................................................... 25
7.02 Effect of Termination.......................................... 26
ARTICLE 8 - GENERAL........................................................ 26
8.01 Further Assurances............................................. 26
8.02 Time of the Essence............................................ 26
8.03 Commissions.................................................... 27
8.04 Confidentiality and Public Announcements....................... 27
8.05 Benefit of the Agreement....................................... 27
8.06 Entire Agreement............................................... 27
8.07 Amendments and Waiver.......................................... 27
8.08 Assignment..................................................... 27
8.09 Notices........................................................ 27
8.10 Severability................................................... 30
8.11 Parties in Interest............................................ 30
8.12 Expenses....................................................... 30
8.13 Governing Law; Attornment...................................... 30
8.14 Counterparts; Facsimile........................................ 31
8.15 Waiver......................................................... 31
8.16 Disclaimer..................................................... 31
8.17 Waiver of Jury Trial........................................... 31
SHARE PURCHASE AGREEMENT
THIS AGREEMENT made as of the 19th day of December, 2005;
BETWEEN:
GLACIER VENTURES INTERNATIONAL CORP., a corporation incorporated
under the laws of Canada or a nominee thereof (hereinafter
collectively referred to as the "Purchaser"),
OF THE FIRST PART,
- and -
HCPH CANADIAN NEWSPAPER HOLDINGS CO., a corporation incorporated
under the laws of Nova Scotia, and any successor in interest
thereto (hereinafter referred to, in either case, as the
"Vendor"),
OF THE SECOND PART,
- and -
XXXXXXXXX INTERNATIONAL INC., a corporation governed by the laws
of the State of Delaware (hereinafter referred to as "Xxxxxxxxx
International"),
OF THE THIRD PART.
WHEREAS the Vendor is the beneficial and registered owner of all of
the outstanding common shares (the "Shares") of 3120575 Nova Scotia Company (the
"Corporation"), a corporation incorporated under the laws of Nova Scotia;
AND WHEREAS the Corporation is the beneficial and registered owner of
62 common shares (the "Fundata Shares") of Fundata Canada Inc. ("Fundata");
AND WHEREAS the Vendor desires to sell and the Purchaser desires to
purchase the Shares upon and subject to the terms and conditions hereinafter set
forth;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the
respective representations, warranties, covenants and agreements contained
herein, the parties hereto agree as follows:
-2-
ARTICLE 1 - INTERPRETATION
1.01 DEFINITIONS
In this Agreement, unless something in the subject matter or context
is inconsistent therewith:
(a) "Affiliate", with respect to the relationship between two or more
corporations, has the meaning attributed to "affiliated bodies
corporate" under the Canada Business Corporations Act as of the date
of this Agreement and, with respect to the relationship between two or
more Persons any of which is not a corporation, a Person is deemed to
be an Affiliate of another Person if one of them is Controlled by the
other or if both are Controlled by the same Person, and "Affiliated"
has a corresponding meaning;
(b) "Applicable Law" means:
(i) any domestic or foreign statute, law (including common and civil
law), code, ordinance, rule, regulation, restriction or by-law
(zoning or otherwise); or
(ii) any judgement, order, writ, injunction, decision, ruling, decree
or award;
of any Governmental Entity, statutory body or self regulatory
authority to the extent only that the same is legally binding on the
Person referred to in the context in which the term is used;
(c) "Agreement" means this agreement and all amendments made hereto by
written agreement between the Vendor, Xxxxxxxxx International and the
Purchaser;
(d) "Benefit Plan" means all bonus, deferred compensation, incentive
compensation, share purchase, share option, share appreciation,
phantom share savings, profit sharing, severance or termination pay,
health, dental or other medical life, disability or other insurance
(whether insured or self-insured), mortgage insurance, employee loan,
employee assistance, supplementary unemployment benefit, pension,
retirement, supplementary retirement plan, program and every other
benefit plan, program, agreement, arrangement or practice (whether
written or unwritten) maintained or contributed to for the benefit of
any of employees, former employees or their respective dependents or
beneficiaries, but excluding the Canada Pension Plan, the Quebec
Pension Plan, any health or drug plan established and administered by
a Province and workers' compensation insurance provided by federal or
provincial legislation or a comparable program established and
administered outside Canada;
(e) "Books and Records" means all books, records, files and papers of the
Corporation, including computer manuals, computer data, financial and
Tax working papers, financial and Tax books and records, business
reports, business plans and projections, sales and advertising
materials, sales and purchases records and correspondence, trade
association files, research and development records,
-3-
lists of present and former customers and suppliers, personnel and
employment records (including Benefit Plan records), minute and share
certificate books, and all copies and recordings of the foregoing;
(f) "Business Day" means a day other than a Saturday, Sunday or statutory
holiday in Ontario;
(g) "Closing" means the closing of the purchase and sale of the Shares
contemplated by this Agreement;
(h) "Closing Date" is defined in Section 2.02(1);
(i) "Consent" is defined in Section 4.01(1);
(j) "Contract" means any agreement, contract, indenture, lease, deed of
trust, option or other legally binding commitment or obligation in the
nature of a contract, whether oral or written, for which there are
continuing rights or obligations;
(k) "Control", with respect to the relationship with a Person, means:
(i) if that Person is a corporation, the holding (other than by way
of security) of Equity Securities of that Person to which are
attached more than 50% of the votes that may be cast for the
election of directors and those votes are sufficient, if
exercised, to elect a majority of the board of directors; or
(ii) the right, directly or indirectly, to direct or cause the
direction of the management of the affairs of that Person,
whether by ownership of Equity Securities, by Contract or
otherwise;
and "Controls" and "Controlled" have corresponding meanings;
(l) "Corporation" means 3120575 Nova Scotia Company, a corporation
incorporated under the laws of Nova Scotia;
(m) "Deductible" is defined in Section 6.01(3);
(n) "Disclosure Letter" means the disclosure letter of the Vendor attached
hereto as Schedule 1.01(n);
(o) "Encumbrance" means any lien, pledge, charge, claim, security,
interest, contingent sale or title retention agreement, option, deed
of trust, mortgage, conditional sales agreement, right of first
refusal or other right of a third party substantially equivalent
thereto;
(p) "End Date" is defined in Section 7.01(2);
(q) "Equity Securities" means any shares of a corporation, partnership
units or interests or similar securities;
-4-
(r) "Filing" is defined in Section 4.01(1);
(s) "Fundata" means Fundata Canada Inc., a corporation incorporated under
the laws of Ontario;
(t) "Fundata Agreement" means the shareholder agreement dated November 21,
1991 between Southam Business Communications Inc., HKA Data Processing
Limited and Fundata;
(u) "Fundata Shares" means 62 common shares of Fundata owned by the
Corporation;
(v) "GAAP" means generally accepted accounting principles in Canada,
applicable as of date hereof and, in respect of the financial
statements of any Person, applied on a basis consistent with those
applied in previous periods of such Person unless otherwise required
under GAAP;
(w) "Governmental Entity" means any domestic or foreign government,
whether federal, provincial, state, territorial, local, regional,
municipal, or other political jurisdiction, and any agency, authority,
instrumentality, court, tribunal, board, commission, bureau,
arbitrator, arbitration tribunal or other tribunal, or any
quasi-governmental or other entity, insofar as it exercises a
legislative, judicial, regulatory, administrative, expropriation or
taxing power or function of or pertaining to government, as well as
any stock exchange;
(x) "Great West" means Great West Newspaper Group Ltd.;
(y) "Xxxxxxxxx Pre-Closing Reorganization Steps" mean the transactions
referred to in Schedule 4.05;
(z) "Income", in respect of any period, means the income of the
Corporation or Fundata as determined for purposes of the ITA for such
period;
(aa) "Indemnification Event" means an event, occurrence or state of affairs
for which a Party is expressly indemnified hereunder;
(bb) "Indemnification Notice" means a written notice in reasonable detail
delivered by the Vendor to the Purchaser, or by the Purchaser to the
Vendor, as applicable, stating a demand for indemnification in
accordance with Section 6.01;
(cc) "Indemnified Party" is defined in Section 6.01(7)(a);
(dd) "Indemnifying Party" is defined in Section 6.01(7)(a);
(ee) "Insurance Benefits" is defined in Section 6.01(10);
(ff) "ITA" means the Income Tax Act (Canada), R.S.C. 1985 (5th Supp.) c. 1,
and the regulations promulgated thereunder, as --- amended from time
to time;
-5-
(gg) "Xxxxxxx" means Xxxxxxx Newspapers Inc.;
(hh) "Letter of Intent" means the letter agreement between Xxxxxxxxx
International and Glacier dated December 15, 2005 in respect of the
transactions contemplated hereby;
(ii) "Losses" means any and all financial losses, damages, liabilities,
obligations, penalties, encumbrances, assessments, costs and expenses
sustained, suffered or incurred by the Party seeking indemnification
as a direct result of any Indemnification Event; provided, however,
that Losses shall not include any indirect or consequential or
punitive losses or damages, lost profits or lost revenue;
(jj) "Material Adverse Change" or "Material Adverse Effect" means any
change or effect that has or could reasonably be expected to have a
material and adverse effect on the business, assets or financial
condition of the Corporation and Fundata, taken as a whole, and
"Materially Adversely Effect" has a corresponding meaning;
(kk) "Non-Competition Agreement" means the agreement to be entered into by
the Purchaser, Fundata, the Vendor and Xxxxxxxxx International
contemporaneously with Closing whereby, in consideration of the sum of
$1,000, each of the Vendor and Xxxxxxxxx International will agree not
to compete with Fundata following Closing;
(ll) "Ordinary Course" means, with respect to an action taken by a Person,
that the action is consistent with the past practices of the Person
and is taken in the normal day-to-day operations of the Person and,
with respect to Xxxxxxxxx International and any subsidiary of
Xxxxxxxxx International (other than the Corporation and Fundata) since
January 17, 2004;
(mm) "Party" means the Vendor, the Purchaser or Xxxxxxxxx International, as
the case may be;
(nn) "Person" means an individual, corporation, partnership, joint venture,
trust, limited liability company, unincorporated organization or other
entity, or a Governmental Entity;
(oo) "Purchase Price" is defined in Section 2.01(1);
(pp) "Representation and Warranty Losses" is defined in Section 6.01(3);
(qq) "Representatives", with respect to a Party, means its directors,
officers, employees, auditors, agents and other representatives and
advisors;
(rr) "Safe Income" means the income earned or realized by the Corporation
and Fundata for purposes of section 55 of the ITA for the period
ending at the safe-income determination time, as defined in subsection
55(1) of the ITA, for the
-6-
series of transactions that includes the purchase of the Shares under
this Agreement;
(ss) "Shares" means all of the outstanding common shares of the
Corporation;
(tt) "Tax" or "Taxes" means all taxes, charges, fees, levies, imposts and
other assessments, including all income, sales, use, goods and
services, value added, capital, capital gains, alternative, net worth,
transfer, profits, withholding, payroll, employer health, excise,
franchise, real property and personal property taxes, and any other
taxes, customs duties, fees, assessments, royalties, duties,
deductions, compulsory loans or similar charges in the nature of a
tax, including Canada Pension Plan and provincial pension plan
contributions, employment insurance payments and workers compensation
premiums, together with any instalments, and any interest, fines and
penalties, imposed by any governmental authority (including federal,
state, provincial, municipal and foreign governmental authorities),
whether disputed or not;
(uu) "Tax Returns" means any return, declaration, report, schedule or
information statement with respect to Taxes required to be filed with
the Canada Revenue Agency or any other Governmental Entity;
(vv) "Time of Closing" means 9:00 a.m. (Vancouver time) on the Closing
Date; and
(ww) "Title Representation and Warranty Losses" is defined in Section
6.01(5).
1.02 KNOWLEDGE
Any reference to "knowledge of the Vendor" or to phrases of similar
import shall mean only the actual knowledge of Xxxxxx Xxxxx, Xxxxx Xxxx or Xxxxx
Xxxxxxxxx.
1.03 HEADINGS
The division of this Agreement into Articles and Sections and the
insertion of headings are for convenience of reference only and shall not affect
the construction or interpretation of this Agreement. The terms "this
Agreement", "hereof", "hereunder" and similar expressions refer to this
Agreement and not to any particular Article, Section or other portion hereof and
include any agreement supplemental hereto. Unless something in the subject
matter or context is inconsistent therewith, references herein to Articles and
Sections are to Articles and Sections of this Agreement.
1.04 EXTENDED MEANINGS
In this Agreement words importing the singular number only shall
include the plural and vice versa, words importing the masculine gender shall
include the feminine and neuter genders and vice versa and words importing
persons shall include individuals, partnerships, associations, trusts,
unincorporated organizations and corporations.
-7-
1.05 ACCOUNTING PRINCIPLES
Wherever in this Agreement reference is made to a calculation to be
made in accordance with generally accepted accounting principles, such reference
shall be deemed to be to GAAP.
1.06 CURRENCY
All references to currency herein are to lawful money of Canada.
1.07 SCHEDULES
The following are the Schedules annexed hereto and incorporated by
reference and deemed to be part hereof:
Schedule 1.01(n) - Disclosure Letter;
Schedule 3.01(1)(y) - Fundata Financial Statements;
Schedule 4.05 - Xxxxxxxxx Pre-Closing Reorganization Steps; and
Schedule 5.01(1)(b) - Consents and Filings.
ARTICLE 2 - PURCHASE AND SALE
2.01 PURCHASE AND SALE AND PURCHASE PRICE
(1) Upon and subject to the terms and conditions contained herein, the
Vendor shall, at the Time of Closing, sell the Shares to the Purchaser and the
Purchaser shall purchase the Shares from the Vendor for a total purchase price
of Cdn.$15,087,000 (hereinafter referred to as the "Purchase Price").
(2) The Purchase Price shall be paid and satisfied by the Purchaser at the
Time of Closing by wire transfer of immediately available funds to an account or
accounts specified by the Vendor against delivery to the Purchaser of a share
certificate or certificates evidencing the Shares duly endorsed for transfer to
the Purchaser.
2.02 CLOSING AND DELIVERABLES
(1) Subject to the terms and conditions contained herein, the Closing shall
take place as soon as practicable but, in any event, within five (5) Business
Days after satisfaction or waiver of the conditions set forth in Article 5
hereof (other than conditions which, by their terms, are to be satisfied at the
Closing) (the "Closing Date") at the offices of Farris, Vaughan, Xxxxx & Xxxxxx
LLP, 000 X. Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx.
(2) At the Closing, the Vendor shall deliver to the Purchaser the
following:
(a) share certificates representing the Shares duly endorsed for transfer
to the Purchaser or its nominee or accompanied by duly executed stock
transfer powers;
-8-
(b) resolutions of the directors of the Corporation consenting to the
transfer of the Shares by the Vendor to the Purchaser or its nominee;
(c) resignations and releases of each director and officer of the
Corporation and Fundata that is a Vendor nominee as identified by the
Purchaser at least 3 Business Days prior to the Closing;
(d) the officer's certificates referred to in Section 5.01(1)(b), (c) and
(d);
(e) a certificate of a duly authorized officer of the Corporation
attaching copies of: (i) the articles of incorporation or similar
documents of the Corporation and Fundata; (ii) a certificate of good
standing, status or similar certificate in respect of the Corporation
and Fundata dated within three (3) Business Days of the Closing Date;
and (iii) the by-laws of the Corporation and Fundata; and
(f) executed counterparts of the Non-Competition Agreement signed by the
Vendor and Xxxxxxxxx International.
(3) At the Closing, the Purchaser shall deliver to the Vendor the
following:
(a) payment of the Purchase Price in Canadian dollars by wire transfer of
immediately available funds to an account or accounts specified by the
Vendor;
(b) an officer's certificate in accordance with Section 5.03(1)(c); and
(c) executed counterparts of the Non-Competition Agreement signed by the
Purchaser and Fundata.
2.03 GUARANTEE
Xxxxxxxxx International hereby unconditionally and irrevocably
guarantees the due and punctual performance by the Vendor of its obligations
under this Agreement as the same may be amended, changed, replaced, settled,
compromised or otherwise modified, from time to time, and irrespective of any
bankruptcy, insolvency, dissolution, winding-up, termination of the existence of
the Purchaser or any successor or permitted assign of the Purchaser, including,
without limitation, the unconditional and irrevocable payment of all
indemnification claims for which the Vendor is liable to the Purchaser pursuant
to this Agreement. Xxxxxxxxx International shall be liable to the Purchaser if
and only to the extent that it is established that the Vendor is so liable. The
Purchaser is not required to exhaust all remedies against the Vendor prior to
proceeding against Xxxxxxxxx International under this guarantee. In no event
shall the liability of Xxxxxxxxx International to the Purchaser hereunder be
greater than that of the Vendor to the Purchaser hereunder.
2.04 TAXES
The Purchaser shall pay any sales, use, transfer, excise, stamp or
other similar taxes imposed by reason of the sale of the Shares, excluding for
greater certainty any income taxes, capital or capital gains taxes from the
Vendor, pursuant to this Agreement and any deficiency, interest or penalty with
respect to such taxes.
-9-
ARTICLE 3 - REPRESENTATIONS AND WARRANTIES
3.01 VENDOR'S REPRESENTATIONS AND WARRANTIES
(1) The Vendor represents and warrants to the Purchaser that, except as
disclosed in the Disclosure Letter:
(a) the Vendor is the beneficial and registered owner of the Shares;
(b) the Vendor has good and sufficient power, authority and right to enter
into and deliver and perform its obligations under this Agreement and
the Vendor has the power, authority and right to transfer the legal
and beneficial title and ownership of the Shares to the Purchaser free
and clear of all Encumbrances;
(c) the execution, delivery and performance of this Agreement has been
duly authorized by all necessary corporate action on the part of the
Vendor and this Agreement has been duly executed and delivered by, and
constitutes a valid and legally binding obligation of, the Vendor,
enforceable against the Vendor in accordance with its terms subject to
general principles of equity and to applicable bankruptcy, insolvency,
reorganization and other laws of general application limiting the
enforcement of creditors' rights generally and to the fact that
specific performance is an equitable remedy available only in the
discretion of the court;
(d) there is no contract, option or any other right of another binding
upon the Vendor to sell, transfer, assign, pledge, charge, mortgage or
in any other way dispose of or encumber any of the Shares other than
pursuant to the provisions of this Agreement;
(e) neither the entering into nor the delivery of this Agreement nor the
completion of the transactions contemplated hereby by the Vendor will
result in the violation or breach of:
(i) any of the provisions of the constating documents of the Vendor;
or
(ii) any Contract to which the Vendor is a party or by which the
Vendor is bound;
except where such violation would not have a material adverse effect
on the ability of the Vendor to perform its obligations hereunder;
(f) no approval, order, consent of or filing with any Governmental Entity
is required in connection with the execution and delivery by the
Vendor of this Agreement or any other documents and agreements to be
delivered under this Agreement or the performance of the obligations
of the Vendor under this Agreement or any other documents and
agreements to be delivered under this Agreement except where the
failure to obtain such approval, order or consent or make such filing
would not have a material adverse effect on the Vendor or its ability
to carry out its obligations hereunder;
-10-
(g) the Vendor is not a non-resident person within the meaning of section
116 of the Income Tax Act (Canada);
(h) the Corporation is a corporation duly incorporated and validly
subsisting under the laws of Nova Scotia, with the corporate power to
own its assets;
(i) the authorized share capital of the Corporation consists of 100,000
common shares of which only the Shares are issued and outstanding;
(j) the Corporation has no liabilities;
(k) the Corporation has carried on no business other than the acquisition
and holding of the Fundata Shares;
(l) the Corporation will, at Closing, be the legal and beneficial owner of
the Fundata Shares;
(m) there is no contract, option or similar obligation binding upon the
Corporation to: (i) issue any unissued Equity Securities, or (ii)
repurchase, redeem or otherwise acquire any Equity Securities of the
Corporation;
(n) to the knowledge of the Vendor, Fundata is a corporation duly
incorporated and validly subsisting under the laws of Ontario, with
the corporate power to own its assets and carry on its businesses;
(o) to the knowledge of the Vendor, the authorized share capital of
Fundata consists of an unlimited number of common shares, of which 124
common shares are issued and outstanding;
(p) to the knowledge of the Vendor, there is no contract, option or
similar obligation binding upon Fundata to: (i) issue any unissued
Equity Securities; or (ii) repurchase, redeem or otherwise acquire any
Equity Securities of Fundata;
(q) to the knowledge of the Vendor, the business of Fundata has been
carried on in the Ordinary Course in all material respects since
September 30, 2005 and, to the knowledge of the Vendor, Fundata has
not entered into any material transaction out of the Ordinary Course
since that date;
(r) to the knowledge of the Vendor, Fundata is not a party to or bound by
any guarantee, support, indemnification, surety or similar obligation
with respect to the obligations or indebtedness of any other Person
that is material;
(s) to the knowledge of the Vendor, Fundata has no outstanding bonds,
debentures, notes or mortgages maturing more than one year after the
date of their original issuance in a material amount;
(t) to the knowledge of the Vendor, Fundata is not currently indebted, in
any material amount, to any officer, director, employee or shareholder
of Fundata or any other
-11-
person with whom Fundata does not deal at arm's length (within the
meaning of the ITA) other than for usual compensation paid in the
Ordinary Course;
(u) to the knowledge of the Vendor, Fundata does not have any agreement,
option or commitment to acquire any Equity Securities of any Person or
to acquire or lease any business, operations, real property or assets
which assets would be material to Fundata;
(v) to the knowledge of the Vendor, the lease for the premises occupied by
Fundata at 00 Xxxxxxx Xxxx, Xxxxx Xxxx, Xxxxxxx is currently in good
standing and Fundata has not been notified in writing of any event of
default thereunder;
(w) to the knowledge of the Vendor, there is no agreement or commitment in
writing for the purchase from Fundata of any of its material assets
other than in the Ordinary Course;
(x) to the knowledge of the Vendor, Fundata is not a party to any court
proceeding arising as a result of, or in relation to, the
investigation of the Special Committee of the board of directors of
Xxxxxxxxx International and, to the knowledge of the Vendor, there are
no facts or circumstances that would be reasonably likely to result in
Fundata becoming involved in any court action or proceeding, as a
defendant, related to the matters raised in the report of the Special
Committee of the board of directors of Xxxxxxxxx International;
(y) to the knowledge of the Vendor, the unaudited consolidated financial
statements of Fundata, consisting of a balance sheet as at September
30, 2005 and a statement of operations for the nine months ended
September 30, 2005, which are set out in Schedule 3.01(1)(y), do not
contain any material misstatements;
(z) for the past five years, to the knowledge of the Vendor, Fundata has
filed or caused to be filed, within the times and in the manner
prescribed by Applicable Law, all federal and provincial income tax
returns which are required to be filed by it and, to the knowledge of
the Vendor, such tax returns do not contain any material misstatement;
(aa) to the knowledge of the Vendor, there has been no material adverse
change in the financial condition of Fundata since December 31, 2002;
and
(bb) to the knowledge of the Vendor, there is no existing litigation in the
United States against Fundata.
(2) Xxxxxxxxx International represents and warrants to the Purchaser that,
except as disclosed in the Disclosure Letter:
(a) Xxxxxxxxx International is incorporated, organized and existing under
the laws of the jurisdiction of its incorporation, and Xxxxxxxxx
International has good and sufficient power, authority and right to
enter into and deliver this Agreement;
-12-
(b) this Agreement has been duly authorized, executed and delivered by,
and constitutes a valid and legally binding obligation of, Xxxxxxxxx
International, enforceable against Xxxxxxxxx International in
accordance with its terms subject to general principles of equity and
to applicable bankruptcy, insolvency, reorganization and other laws of
general application limiting the enforcement of creditors' rights
generally and to the fact that specific performance is an equitable
remedy available only in the discretion of the court;
(c) neither the entering into nor the delivery of this Agreement nor the
completion of the transactions contemplated hereby by Xxxxxxxxx
International will result in the violation of:
(i) any of the provisions of the constating documents or by-laws of
Xxxxxxxxx International; or
(ii) any Contract to which Xxxxxxxxx International is a party or is
bound;
except where such violation would not have a material adverse effect
on the ability of Xxxxxxxxx International to carry out its obligations
hereunder; and
(d) no approval, order, consent of or filing with any Governmental Entity
is required in connection with the execution and delivery by Xxxxxxxxx
International of this Agreement or any other documents and agreements
to be delivered under this Agreement or the performance of the
obligations of Xxxxxxxxx International under this Agreement or any
other documents and agreements to be delivered under this Agreement
except where the failure to obtain such approval, order or consent or
make such filing would not have a material adverse effect on the
ability of Xxxxxxxxx International to carry out its obligations
hereunder.
3.02 SURVIVAL OF VENDOR'S AND XXXXXXXXX INTERNATIONAL'S REPRESENTATIONS,
WARRANTIES AND COVENANTS
(1) The representations and warranties of the Vendor and Xxxxxxxxx
International set forth in Section 3.01 ((other than those set forth in Section
3.01(1)(a) and 3.01(1)(d)) shall survive the completion of the sale and purchase
of the Shares herein provided for and, notwithstanding such completion, shall
continue in full force and effect for the benefit of the Purchaser for a period
of 24 months from the Closing Date. The representations and warranties of the
Vendor set forth in Section 3.01(1)(a) and 3.01(1)(d) shall survive the
completion of the sale and purchase of the Shares herein provided for and,
notwithstanding such completion, shall continue in full force and effect for the
benefit of the Purchaser for a period of 36 months from the Closing Date.
(2) The covenants of the Vendor set forth in this Agreement shall survive
the completion of the sale and purchase of the Shares herein provided for and,
notwithstanding such completion, shall continue in full force and effect for the
benefit of the Purchaser in accordance with the terms thereof.
-13-
3.03 PURCHASER'S REPRESENTATIONS AND WARRANTIES
(1) The Purchaser represents and warrants to the Vendor that:
(a) the Purchaser is a corporation duly incorporated and validly
subsisting under the federal laws of Canada and any nominee will be a
corporation duly incorporated and validly subsisting under the laws of
British Columbia;
(b) the Purchaser has good and sufficient power, authority and right to
enter into, deliver and perform its obligations under this Agreement
and to complete the transactions to be completed by the Purchaser
contemplated hereby;
(c) the execution, delivery and performance of this Agreement has been
duly authorized by all necessary corporate action on the part of the
Purchaser, the Agreement has been duly executed and delivered by the
Purchaser and constitutes a valid and legally binding obligation of
the Purchaser, enforceable against the Purchaser in accordance with
its terms subject to general principles of equity and to applicable
bankruptcy, insolvency, reorganization and other laws of general
application limiting the enforcement of creditors' rights generally
and to the fact that specific performance is an equitable remedy
available only in the discretion of the court;
(d) neither the entering into nor the delivery of this Agreement nor the
completion of the transactions contemplated hereby by the Purchaser
will result in the violation of:
(i) any of the provisions of the constating documents of the
Purchaser; or
(ii) any Contract to which the Purchaser is a party or by which the
Purchaser is bound;
except where such violation would not have a material adverse effect
on the ability of the Purchaser to carry out its obligations
hereunder;
(e) the Purchaser is a Canadian within the meaning of the Investment
Canada Act (Canada); and
(f) no approval, order, consent of or filing with any Governmental Entity
is required, other than certain orders of the Toronto Stock Exchange,
in connection with the execution and delivery by the Purchaser of this
Agreement or any other documents and agreements to be delivered under
this Agreement or the performance of the obligations of the Purchaser
under this Agreement or any other documents and agreements to be
delivered under this Agreement except where the failure to obtain such
approval, order or consent or make such filing would not have a
material adverse effect on the ability of the Purchaser to carry out
its obligations hereunder.
-14-
3.04 SURVIVAL OF PURCHASER'S REPRESENTATIONS, WARRANTIES AND COVENANTS
(1) The representations and warranties of the Purchaser set forth in
Section 3.03 shall survive the completion of the sale and purchase of the Shares
herein provided for and, notwithstanding such completion, shall continue in full
force and effect for the benefit of the Vendor for a period of 24 months from
the Closing Date.
(2) The covenants of the Purchaser set forth in this Agreement shall
survive the completion of the sale and purchase of the Shares herein provided
for and, notwithstanding such completion, shall continue in full force and
effect for the benefit of the Vendor in accordance with the terms thereof.
3.05 INVESTIGATION
The Purchaser is knowledgeable about the industry in which Fundata
operates and is experienced in the acquisition and management of businesses. The
Purchaser and its Representatives have been afforded reasonable access to the
Books and Records, Contracts, facilities and personnel of Fundata for purposes
of conducting a due diligence investigation of Fundata and its business. The
Purchaser has conducted a reasonable due diligence investigation of Fundata and
its business. The Purchaser acknowledges that it has been advised by Xxxxxxxxx
International and the Vendor that neither the Vendor, Xxxxxxxxx International
nor their respective Affiliates are or have been involved in the day-to-day
management of Fundata nor do they or have they exercised any material oversight
in respect of the management of Fundata.
3.06 NO INDUCEMENT OR RELIANCE; INDEPENDENT ASSESSMENT
(1) The Purchaser has not been induced by and has not relied upon any
representations, warranties or statements, whether express or implied, made by
the Vendor, Xxxxxxxxx International (or their Affiliates or Representatives)
that are not expressly set forth herein (including the Disclosure Letter),
whether or not any such representations, warranties or statements were made in
writing or orally.
(2) The Purchaser acknowledges that none of the Vendor, Xxxxxxxxx
International or their Affiliates or Representatives makes, will make or has
made any representation or warranty, express or implied, as to the prospects of
Fundata or its business for the Purchaser or with respect to any forecasts,
projections or business plans made available to the Purchaser in connection with
the Purchaser's review of Fundata and its business. No information provided by
Fundata to the Purchaser concerning Fundata or its business shall constitute or
be deemed to constitute, in any way, information or a representation of or
provided by the Vendor or Xxxxxxxxx International.
3.07 RELEASE
From and after the expiry of the time periods referred to in Sections
3.02(1) and 3.04(1) (as applicable), each Party releases and forever discharges
each other Party (including Xxxxxxxxx International, in the case of the release
by the Purchaser) from any and all claims, demands, causes of action,
liabilities, obligations, costs and damages of any nature whatsoever which the
Party may have in respect of or in any way arising out of any inaccuracy in or
breach of any representation or warranty contained in this Agreement and any
instrument or certificate or other
-15-
document executed or delivered pursuant to this Agreement, except for (and only
to the extent of) any claim in respect of which the Party making the claim has
provided notice to the Party making that representation and warranty in
accordance with Section 6.01(7) prior to the expiry of those time limits and in
respect of which any applicable limitation period imposed by Applicable Law has
not expired and, in that event, only on the terms and conditions of and to the
extent provided for in Article 6.
ARTICLE 4 - COVENANTS
4.01 APPROPRIATE ACTION; CONSENTS; FILINGS
(1) Upon the terms and subject to the conditions set forth herein, from the
date hereof until the Closing Date, the Vendor and the Purchaser shall use their
respective commercially reasonable efforts to take, or cause to be taken, all
appropriate action, and do, or cause to be done, and to assist and cooperate
with the other Party in doing all things necessary, proper or advisable under
Applicable Law or otherwise to consummate and make effective the transactions
contemplated herein as promptly as practicable, including: (i) executing and
delivering any additional instruments necessary, proper or advisable to
consummate the transactions contemplated herein, and to carry out fully the
purposes of this Agreement; (ii) identifying and making all necessary
registrations, declarations, notices or filings (each a "Filing") with any
Governmental Entity as is required in connection with the execution and delivery
of this Agreement or the consummation of the transactions contemplated herein,
and thereafter making any other required submissions, with respect to the
transactions contemplated hereby and any other Applicable Law; and (iii)
obtaining all consents, waivers, approvals, licenses, permits, orders or
authorizations (each, a "Consent") of any Governmental Entity or third party
necessary for the consummation of the transactions contemplated herein;
provided, however, that the Vendor shall not be required to commence any
litigation or offer or grant any accommodation (financial or otherwise) to any
third-party. In addition to the foregoing, the Purchaser agrees to provide such
information and assurances as to financial capability, resources and
creditworthiness as may be reasonably requested by any Governmental Entity or
other third party whose consent or approval is sought in connection with the
transactions contemplated herein to the extent that such information or
assurances do not increase the benefit that such party possesses under the
applicable contract. The Purchaser and the Vendor shall cooperate with each
other in connection with the making of any Filings in accordance with this
Section 4.01(1), including providing copies of all such documents to the
non-filing Party and its advisors prior to filing and implementing all
reasonable additions, deletions or changes suggested in connection therewith.
All reasonable costs and expenses incurred in connection with the Filings
pursuant to this Section 4.01 shall be paid by the Purchaser and all reasonable
costs and expenses incurred for obtaining the Consents shall be paid by the
Vendor. The Vendor and the Purchaser shall furnish to each other all information
required for any application or other Filing to be made pursuant to any
Applicable Law in connection with the transactions contemplated hereby.
(2) The Purchaser acknowledges that, as a result of the transactions
contemplated hereby, certain consents and waivers may be required from parties
to contracts to which Fundata is party, and that such consents and waivers have
not been obtained and may not be obtained prior to the Closing. The Vendor shall
have no liability whatsoever to the Purchaser arising out of or relating to the
failure to obtain any consents or waivers, that may be required as a result of
the transactions
-16-
contemplated hereby or because of the termination of any contract as a result
thereof. The Purchaser acknowledges that no representation, warranty or covenant
of the Vendor contained herein shall be breached or deemed breached, and no
condition shall be deemed not satisfied, as a result of: (i) the failure to
obtain any such consent or waiver; (ii) any such termination; or (iii) any
claim, lawsuit, action, proceeding or investigation commenced or threatened by
or on behalf of any Person arising out of or relating to the failure to obtain
any such consent, or any such termination.
(3) From the date hereof until the Closing Date, the Vendor and the
Purchaser shall promptly notify each other in writing of any pending or, to the
knowledge of the Vendor or the Purchaser, as applicable, threatened action,
proceeding or investigation by any Governmental Entity or any other Person: (i)
challenging or seeking damages in connection with the transactions contemplated
hereby; or (ii) seeking to restrain or prohibit the consummation of the
transactions contemplated hereby or otherwise limit the right of the Purchaser
to own all or any portion of the Shares. The Vendor and the Purchaser shall
cooperate with each other in defending any such action, proceeding or
investigation, including seeking to have any stay or temporary restraining order
entered by any court or other Governmental Entity vacated or reversed.
4.02 PRESERVATION OF BOOKS AND RECORDS
(1) Promptly following the Closing, the Vendor shall deliver or cause to be
delivered to the Purchaser all original Books and Records in respect of the
Corporation and Fundata in its possession.
(2) For a period of six (6) years from the Closing Date, the Purchaser
shall use all reasonable efforts to preserve and retain, or cause the
Corporation and Fundata to preserve and retain, all material Books and Records
relating to the Corporation and Fundata and the conduct of their respective
businesses prior to the Closing.
(3) The Purchaser shall not, at any time, dispose of or destroy any of the
Books and Records without first offering to turn over possession thereof to the
Vendor by written notice to the Vendor at least sixty (60) days prior to the
proposed date of such disposition or destruction.
(4) The Vendor and Xxxxxxxxx International shall maintain the
confidentiality of any information (other than information that is already in
the public domain or that the Vendor and Xxxxxxxxx International have in their
possession on or prior to the date hereof, except to the extent specifically
covered by any confidentiality undertaking) received from the Purchaser as a
result of its access to the Books and Records under this Section 4.02 and,
except as otherwise authorized by the Purchaser, will not disclose to any third
party (except as may be required by Applicable Law or in any suit, action or
proceeding involving the Vendor or Xxxxxxxxx International) any such
information.
4.03 TAX MATTERS
(1) The Purchaser shall not initiate or cause the Corporation or Fundata to
initiate any Income or Tax adjustment, for any period ending on or before the
Closing Date, that would result in a reduction of Safe Income attributable to
any of the Shares or the Fundata Shares without the prior written consent of the
Vendor.
-17-
(2) The Purchaser shall cause the Corporation and Fundata not to divest,
sell, transfer or otherwise dispose of any asset to any Person in the 2005
calendar year other than: (i) in the Ordinary Course; or (ii) to the extent
required by Applicable Law. The Purchaser shall cause the Corporation and
Fundata not to establish and/or acquire, in the 2005 calendar year, any
corporation other than an unlimited liability company established under the laws
of the Province of Nova Scotia.
(3) The Purchaser shall, and shall cause the Corporation and Fundata to,
provide all financial data and other information concerning the Corporation for
the 2005 calendar year, to enable the Vendor to prepare and file any Tax Returns
required to be filed by it.
4.04 MAIL; PAYMENTS
(1) The Vendor shall promptly deliver to the Purchaser copies of any
correspondence or other communication received by the Vendor after the Closing
Date pertaining to the Corporation or Fundata and, where such correspondence or
other communication relates exclusively to the Corporation or Fundata, originals
thereof. The Purchaser shall and shall cause the Corporation and Fundata to
promptly deliver to the Vendor any correspondence or other communication
received by the Purchaser after the Closing Date pertaining to the Vendor or its
Affiliates.
(2) The Vendor shall promptly pay or deliver to the Purchaser any monies or
cheques which have been mistakenly sent after the Closing Date by customers of
Fundata to the Vendor and which should have been sent to the Purchaser. The
Purchaser shall promptly pay or deliver to the Vendor any monies or checks which
have been mistakenly sent after the Closing Date to the Purchaser and which
should have been sent to the Vendor or its Affiliates.
4.05 XXXXXXXXX PRE-CLOSING REORGANIZATION STEPS
Notwithstanding any other provision of this Agreement, the Vendor and
Xxxxxxxxx International may, at any time prior to the Time of Closing, implement
the Xxxxxxxxx Pre-Closing Reorganization Steps set out in Schedule 4.05.
ARTICLE 5 - CONDITIONS
5.01 CONDITIONS TO OBLIGATIONS OF EACH PARTY
(1) The respective obligations of each Party to effect the transactions
contemplated hereby is subject to the following conditions having been satisfied
or met on or prior to the Closing, any or all of which may be waived by
agreement of the Vendor and the Purchaser, in whole or in part, to the extent
permitted by Applicable Law:
(a) no court or Governmental Entity of competent jurisdiction shall have
enacted, issued, promulgated, enforced or entered any statute, rule,
regulation, executive order, decree, judgment, injunction or other
order (whether temporary, preliminary or permanent), in any case which
is in effect or be pending and which prevents or prohibits, or will
prevent or prohibit if then pending, consummation of the transactions
contemplated hereby; provided, however, that each of the Parties
-18-
shall use its commercially reasonable efforts to cause any such
executive order, decree, judgment, injunction or other order to be
vacated or lifted;
(b) all Filings and Consents that are listed in Schedule 5.01(1)(b) shall
have been duly made or obtained;
(c) completion of the sale by the Vendor of all of the shares of Great
West held by it to 6490239 Canada Inc.; and
(d) evidence of the discharge of the lien of Toronto Dominion (Texas),
Inc. against the Vendor insofar as it relates to the Shares or an
acceptable undertaking to do so.
5.02 CONDITIONS FOR THE BENEFIT OF THE PURCHASER
(1) The sale by the Vendor and the purchase by the Purchaser of the Shares
is subject to the following conditions which are for the exclusive benefit of
the Purchaser to be performed or complied with at or prior to the Time of
Closing:
(a) the representations and warranties of the Vendor set forth in Section
3.01 shall be true and correct in all material respects at the Time of
Closing with the same force and effect as if made at and as of such
time (except for representations and warranties that are made as of a
specific date, which shall be true and correct in all material
respects as of that date);
(b) the Vendor shall have performed or complied in all material respects
with all of the terms, covenants and conditions of this Agreement to
be performed or complied with by the Vendor at or prior to the Time of
Closing;
(c) the Vendor shall have delivered to the Purchaser a certificate
executed on its behalf by its duly authorized officer certifying that
the conditions set forth in Sections 5.02(1)(a) and 5.02(1)(b) hereof
have been satisfied;
(d) the Purchaser shall have received a certificate of the Vendor and
Xxxxxxxxx International certifying that all existing indebtedness of
Fundata to Xxxxxxxxx International or any of its Affiliates has been
repaid in full;
(e) the Purchaser shall have received a certificate of the Vendor and
Xxxxxxxxx International certifying that the Fundata Agreement has been
terminated in respect of the Vendor and that Fundata currently owes no
amounts to Xxxxxxxxx International or any of its Affiliates thereunder
or under any management agreement;
(f) 438328 Ontario Limited (formerly HKA Data Processing Limited) shall
have consented to the indirect transfer by the Vendor to the Purchaser
of the Fundata Shares contemplated hereby;
-19-
(g) those directors and officers of the Corporation and Fundata that are
nominees of the Vendor requested by the Purchaser not less than 3
Business Days prior to Closing shall resign at the Closing;
(h) the Purchaser shall have been furnished with the documents referred to
in Section 2.02(2); and
(i) all necessary corporate steps and proceedings shall have been taken to
permit the Shares to be duly and transferred to and registered in the
name of the Purchaser.
5.03 CONDITIONS FOR THE BENEFIT OF THE VENDOR
(1) The sale by the Vendor and the purchase by the Purchaser of the Shares
is subject to the following conditions which are for the exclusive benefit of
the Vendor to be performed or complied with at or prior to the Time of Closing:
(a) the representations and warranties of the Purchaser set forth in
Section 3.03 shall be true and correct in all material respects at the
Time of Closing with the same force and effect as if made at and as of
such time (except for representations and warranties that are made as
of a specific date, which shall be true and correct in all material
respects as of such date);
(b) the Purchaser shall have performed or complied in all material
respects with all of the terms, covenants and conditions of this
Agreement to be performed or complied with by the Purchaser at or
prior to the Time of Closing;
(c) the Purchaser shall have delivered to the Vendor a certificate
executed on it behalf by its duly authorized officer certifying that
the conditions set forth in Sections 5.03(1)(a) and (b) have been
satisfied; and
(d) the Vendor shall have been furnished the documents referred to in
Section 2.02(3).
ARTICLE 6 - INDEMNIFICATION
6.01 INDEMNIFICATION
(1) If the Closing shall occur, and subject to the provisions of this
Article 6, the Vendor hereby agrees to indemnify and hold harmless the Purchaser
against and from any and all Losses incurred by the Purchaser as a result of:
(a) the failure of any representation or warranty of the Vendor or
Xxxxxxxxx International contained in this Agreement to be true and
correct as of the date made, except that the Vendor shall not be
required to indemnify or save harmless the Purchaser in respect of any
such failure unless the Purchaser shall have provided notice to the
Vendor in accordance with Section 6.01(7) on or prior to
-20-
the expiration of the applicable time period related to that
representation and warranty set out in Section 3.02; and
(b) any breach or non-performance by the Vendor of any covenant or other
obligation to be performed by it that is contained in this Agreement.
(2) Subject to the provisions of this Article 6, the Purchaser shall
indemnify, defend and save harmless the Vendor from any and all Losses suffered
or incurred by the Vendor as a result of:
(a) the failure of any representation or warranty of the Purchaser
contained in this Agreement to be true and correct as of the date
made, except that the Purchaser shall not be required to indemnify or
save harmless the Vendor in respect of any such failure unless the
Vendor shall have provided notice to the Purchaser in accordance with
Section 6.01(7) on or prior to the expiration of the applicable time
period for that representation and warranty set out in Section 3.04;
and
(b) any breach or non-performance by the Purchaser of any covenant or
other obligation to be performed by it that is contained in this
Agreement.
(3) The Vendor shall not be required to indemnify the Purchaser, and the
Purchaser shall not be entitled to recover from the Vendor, any amount for any
claims described in Section 6.01(1) including any certificate delivered
hereunder in respect thereof (collectively, "Representation and Warranty
Losses"), until and unless the amount which the Purchaser is entitled to recover
in respect of such Losses exceeds, in the aggregate, $100,000 (the
"Deductible"), following which, subject to this Article 6 (including paragraphs
(4), (5) and (6) below), the entire amount which the Purchaser is entitled to
recover in respect of such Losses, less the Deductible, shall be payable.
(4) Any and all Representation and Warranty Losses that involve Losses of
less than $25,000 shall not be entitled to indemnification under this Section
6.01 and shall not be counted toward satisfaction of the Deductible.
(5) The maximum aggregate amount recoverable by the Purchaser for any and
all Representation and Warranty Losses (other than Representation and Warranty
Losses relating to breaches or inaccuracies of the Vendor's representation and
warranties in Section 3.01(1)(a) or and Section 3.01(1)(d) ("Title
Representation and Warranty Losses")) shall (inclusive of all legal fees and
disbursements) not, in any event, exceed $1,000,000 and in no event shall the
Vendor be liable for any amount in excess thereof and the maximum aggregate
amount recoverable by the Purchaser for any and all Title Representation and
Warranty Losses shall (inclusive of all legal fees and disbursements) not, in
any event, exceed an amount equal to 100% of the Purchase Price and in no event
shall the Vendor be liable for any amount in excess thereof. The maximum
aggregate amount recoverable by the Vendor from the Purchaser in respect of all
Losses incurred by the Vendor pursuant to claims described in Section 6.01(2)
including any certificate delivered hereunder in respect thereof shall
(inclusive of all legal fees and disbursements) not, in any event, exceed
$1,000,000 and in no event shall the Purchaser be liable for any amount in
excess thereof.
(6) The maximum aggregate amount recoverable by the Purchaser from the
Vendor in respect of all Losses incurred by the Purchaser (including, without
limitation, Representation and
-00-
Xxxxxxxx Xxxxxx, Xxxxx Representation and Warranty Losses, and Losses under any
other document or agreement contemplated hereby or otherwise) shall be an amount
equal to 100% of the Purchase Price (inclusive of all legal fees and
disbursements) and in no event shall the Vendor be liable to the Purchaser for
any Losses in excess of such amount.
(7) The following procedures shall apply to claims for indemnification
under this Article 6:
(a) In the event that a Party shall incur or suffer any Losses (or shall
reasonably anticipate that it shall suffer any Losses), in respect of
which indemnification may be sought by such Party (an "Indemnified
Party") pursuant to the provisions of this Article 6 from the other
Party (each, an "Indemnifying Party"), the Indemnified Party shall
promptly submit to the Indemnifying Party an Indemnification Notice
stating the nature and basis of such claim including a description in
reasonable detail of the facts giving rise to the claim for
indemnification hereunder and (if known) the amount or the method of
computation of the amount of such claim, and a reference to the
provisions of this Agreement upon which such claim is based; provided,
however, that the failure of the Indemnified Party to give the
Indemnification Notice promptly shall not relieve the Indemnifying
Party of any liability that the Indemnifying Party may have to the
Indemnified Party, except to the extent that the Indemnifying Party is
prejudiced thereby. In the case of Losses arising by reason of any
third-party claim, the Indemnification Notice shall be given within
thirty (30) days of the filing or other written assertion of any such
claim against the Indemnified Party, but the failure of the
Indemnified Party to give the Indemnification Notice within such time
period shall not relieve the Indemnifying Party of any liability that
the Indemnifying Party may have to the Indemnified Party, except to
the extent that the Indemnifying Party is prejudiced thereby.
Thereafter, the Indemnified Party shall deliver to the Indemnifying
Party, within ten (10) calendar days after the Indemnified Party's
receipt thereof, copies of all notices and documents (including court
papers) received by the Indemnified Party relating to the third-party
claim. Notwithstanding the foregoing, should a Person be served with a
complaint with regard to a third-party claim, the Indemnified Party
must notify the Indemnifying Party with a copy of the complaint within
ten (10) calendar days after receipt thereof and shall deliver to the
Indemnifying Party within ten (10) calendar days after the receipt of
such complaint copies of notices and documents (including court
papers) received by the Indemnified Party relating to the third-party
claim (or in each case such earlier time as may be necessary to enable
the Indemnifying Party to respond to the court proceedings on a timely
basis); provided, however, that failure to do so shall not relieve the
Indemnifying Party of any liability that it may have to the
Indemnified Party, except to the extent that the Indemnifying Party is
prejudiced thereby.
(b) The Indemnified Party shall provide to the Indemnifying Party on
request all information and documentation in the Indemnified Party's
possession: (i) that is not privileged and is reasonably necessary;
and (ii) that is critical (whether or not privileged), in each case,
to support and verify any Losses which the Indemnified
-22-
Party believes give rise to a claim for indemnification hereunder and
shall give the Indemnifying Party access to all books, records and
personnel in the possession or under the control of the Indemnified
Party which would have bearing on such claim.
(c) In the case of third-party claims with respect to which an
Indemnification Notice is given, the Indemnifying Party shall have the
option at its own expense: (i) to conduct any proceedings or
negotiations in connection therewith; (ii) to take all other steps to
settle or defend any such claim; and (iii) to employ counsel of the
Indemnifying Party's choosing and approved by the Indemnified Party,
acting reasonably, to contest any such claim in the name of the
Indemnified Party or otherwise. The Indemnifying Party may not
compromise or settle any claim without the Indemnified Party's prior
written consent, which may not be unreasonably withheld or delayed.
Should the Indemnifying Party provide written notice of its desire to
settle any third party claim but the Indemnified Party does not
provide consent within a reasonable period of time, the Indemnified
Party shall be responsible for any incremental costs and expenses
incurred beyond the proposed settlement amount. The Indemnified Party
shall be entitled to participate at its own expense and by its own
counsel in any proceedings relating to any third-party claim, and the
Indemnified Party shall be entitled to participate with counsel of its
own choice at the expense of the Indemnifying Party if, on the written
advice of legal counsel, representation of both Parties by the same
counsel presents a conflict of interest or is otherwise inappropriate
under applicable standards of professional conduct. The Indemnifying
Party shall, within twenty (20) days of receipt of the Indemnification
Notice, notify the Indemnified Party of its intention to assume the
defense of any such claim. Until the Indemnified Party has received
notice of the Indemnifying Party's election whether to defend any such
claim, the Indemnified Party shall take reasonable steps to defend
(but may not settle) such claim. If the Indemnifying Party shall
decline to assume the defense of any such claim, or shall fail to
notify the Indemnified Party within twenty (20) days after receipt of
the Indemnification Notice of the Indemnifying Party's election to
defend such claim or fails to diligently defend such claim after
electing to assume conduct, the Indemnified Party shall defend such
claim but may not settle such claim without the advance written
consent of the Indemnifying Party (which consent shall not be
unreasonably withheld or delayed). Should the Indemnified Party
provide notice of its desire to settle such claim but the Indemnifying
Party does not provide written consent within a reasonable period of
time, the Indemnifying Party shall be responsible for any incremental
costs and expenses incurred beyond the proposed settlement amount. The
expenses of all proceedings, contests or lawsuits in respect of any
such claims (other than those incurred by the Indemnified Party which
are referred to in the third and fourth sentences of this subparagraph
(c)) shall be borne by the Indemnifying Party but only if the
Indemnifying Party is responsible pursuant hereto to indemnify the
Indemnified Party in respect of such claim and, if applicable, only to
the extent required by this Section 6.01(7). Regardless of which Party
shall assume the defense of the claim, the Parties agree to cooperate
fully with one another in connection therewith.
-23-
(8) Nothing in this Section 6.01 shall be construed as a limitation on the
Indemnifying Party's right to contest in good faith whether the Indemnified
Party is entitled to indemnification pursuant to this Section 6.01 with respect
to a particular claim. The Indemnified Party shall have the burden of proof in
establishing the existence of a claim for indemnification under this Agreement
and the amount of Losses suffered by it.
(9) The indemnification provided for in this Section 6.01 shall be the sole
and exclusive remedy of the Purchaser (except in the case of fraud on the part
of the Vendor), whether in contract, tort or otherwise, for all matters arising
under or in connection with this Agreement and the transactions contemplated
hereby, including, without limitation, for any inaccuracy or breach of any
representation, warranty, covenant or agreement set forth herein and the
Purchaser hereby irrevocably waives and releases any rights to take action,
institute proceedings or make any claims of any nature whatsoever against the
Vendor (or Xxxxxxxxx International) or their respective Affiliates except
pursuant to such indemnification provisions. The indemnification provided for in
this Section 6.01 shall be the sole and exclusive remedy of the Vendor (except
in the case of fraud on the part of the Purchaser), whether in contract, tort or
otherwise, for all matters arising under or in connection with this Agreement
with respect to the breach of any representation or warranty set forth herein.
(10) Notwithstanding anything contained herein to the contrary, the amount
of any Losses incurred or suffered by an Indemnified Party shall be calculated
after giving effect to: (i) any insurance proceeds received by or otherwise
payable to the Indemnified Party (or any of its Affiliates) with respect to such
Losses (collectively, "Insurance Benefits"); and (ii) any recoveries obtained by
the Indemnified Party (or any of its Affiliates) from any party other than the
Indemnifying Party. Each Indemnified Party shall exercise commercially
reasonable efforts to obtain such proceeds, benefits and recoveries. If any such
proceeds, benefits or recoveries are received by an Indemnified Party (or any of
its Affiliates) with respect to any Losses after an Indemnifying Party has made
a payment to the Indemnified Party with respect thereto, the Indemnified Party
(or such Affiliate) shall pay to the Indemnifying Party the amount of such
proceeds, benefits or recoveries (up to the amount of the Indemnifying Party's
payment). With respect to any Losses incurred or suffered by an Indemnified
Party, no liability shall attach to the Indemnifying Party in respect of any
Losses to the extent that the same Losses have been recovered by the Indemnified
Party and, accordingly, the Indemnified Party may only recover once in respect
of the same Loss.
(11) Upon making any payment to an Indemnified Party in respect of any
Losses, the Indemnifying Party shall, to the extent of such payment, be
subrogated to all rights of the Indemnified Party (and its Affiliates) against
any third party in respect of the Losses to which such payment relates. Such
Indemnified Party (and its Affiliates) and Indemnifying Party shall execute upon
request all instruments reasonably necessary to evidence or further perfect such
subrogation rights. The Purchaser shall use commercially reasonable efforts to
mitigate any Losses in respect of which indemnification under this Agreement may
be sought, whether by asserting claims against a third party or by otherwise
qualifying for a benefit that would reduce or eliminate Losses. To the extent
that any breach of any representation or warranty contained in this Agreement or
any other provision of this Agreement is capable of remedy, the Indemnified
Party shall afford the Indemnifying Party a reasonable opportunity to remedy the
matter complained of.
-24-
(12) The liability of the Vendor in respect of any claim by the Purchaser
under this Agreement shall be reduced by the amount by which any Taxes for which
the Purchaser, the Corporation or any Subsidiary is now or in the future
accountable or liable to be assessed is reduced or extinguished as a result of
the matter giving rise to such liability.
(13) From the date hereof through the Closing Date, the Vendor shall have
the right, from time to time, to modify, amend and/or supplement the Disclosure
Letter by delivering any such modifications, amendments and/or supplements to
the Purchaser in writing in accordance with the terms of this Agreement. No such
supplement, amendment or modification shall be evidence, in and of itself, that
the representations and warranties in the corresponding Section are no longer
true and correct in all material respects. It is specifically agreed that the
Disclosure Letter may be modified, amended and/or supplemented to add
immaterial, as well as material, items thereto. In the event that the Vendor
provides the Purchaser with an amendment, supplement, or modification to the
Disclosure Letter within three Business Days prior to the date that the parties
intend to close the transaction contemplated in this Agreement, the parties
agree to extend the Closing Date for a period of three Business Days from the
date of delivery of such information, or otherwise as the parties may agree. In
the event that the amendment, supplement or modification to the Disclosure
Letter constitutes a Material Adverse Effect, then the Purchaser may, at its
election within 3 Business Days of receipt, terminate its obligation to complete
the transactions contemplated hereby by notice in writing to the Vendor. For
purposes of determining whether the Vendor is subject to any claim for
indemnification under this Section 6.01 following the Closing Date for a breach
of any representation or warranty under this Agreement, the Disclosure Letter
shall be deemed to include the information contained therein on the date hereof
and such other information as may be set forth in any modification, amendment
and/or supplement to the Disclosure Letter delivered by the Vendor to the
Purchaser pursuant to this Section 6.01(13). Disclosure of any fact or item in
the Disclosure Letter shall be deemed to constitute disclosure with respect to
each reasonably related provision of this Agreement. Neither the specification
of any dollar amount in any representation or warranty contained in this
Agreement nor the inclusion of any specific item in the Disclosure Letter is
intended to imply that such amount, or higher or lower amounts, or the item so
included or other items, are or are not material, and no party shall use the
fact of the setting forth of any such amount or the inclusion of any such item
in any dispute or controversy between the parties as to whether any obligation,
item or matter not described herein or included in the Disclosure Letter is or
is not material for purposes of this Agreement. Unless this Agreement
specifically provides otherwise, neither the specification of any item or matter
in any representation or warranty contained in this Agreement nor the inclusion
of any specific item in the Disclosure Letter is intended to imply that such
item or matter, or other items or matters, are or are not in the Ordinary Course
of business. No party shall use the fact of the setting forth or the inclusion
of any such item or matter in any dispute or controversy between the parties as
to whether any obligation, item or matter not described herein or included in
the Disclosure Letter is or is not in the Ordinary Course for purposes of this
Agreement.
(14) In no event shall the Vendor be required to indemnify the Purchaser
and the Vendor shall have no liability to the Purchaser:
(a) to the extent the indemnification obligation or liability arises or is
increased as a result of any action taken or omitted to be taken by
the Purchaser or any of its
-25-
Affiliates (including any action taken or omitted to be taken by the
Corporation or any Subsidiary on or after the Closing Date);
(b) for any Loss or matter to the extent resulting from a change in
Applicable Law that becomes effective after the Closing Date;
(c) for any Loss or matter to the extent arising from a change in the
accounting policies or practices of the Corporation or any Subsidiary
after the Closing; or
(d) to the extent that the Vendor is unable to challenge or dispute any
claim due to the loss or destruction of any relevant Books and Records
by the Corporation or the Purchaser.
(15) Notwithstanding anything contained herein to the contrary, the Vendor
shall have no liability for a breach of or inaccuracy in any representation or
warranty if the Purchaser was aware, at or before the Closing Date, of the facts
as a result of which such representation or warranty was breached or inaccurate.
(16) Any amounts payable under Section 6.01 (other than interest) shall be
treated by the Purchaser and the Vendor as an adjustment to the Purchase Price.
(17) The obligation of the Vendor to indemnify the Purchaser hereunder for
any particular Loss, insofar as such Loss arises from or in respect of (or is
incurred by) Fundata shall, in all events, be limited to 50% of the dollar
amount of such Loss, which amount may be reduced pursuant to the other
provisions of this Agreement.
ARTICLE 7 - TERMINATION
7.01 TERMINATION
This Agreement may be terminated at any time prior to the Closing
Date:
(1) by mutual written agreement of the Vendor and the Purchaser; or
(2) by written notice by either the Vendor or the Purchaser, by the
terminating Party to the other Party, if:
(a) the transactions contemplated hereby shall not have been consummated
by 5:00 p.m., (Toronto time) on December 31, 2005 (the "End Date"),
subject to the right of the Vendor, in its sole discretion, to extend
the End Date to such time on a date on or prior to January 31, 2006 by
notice in writing to the Purchaser, in which case the End Date shall
be such time on such date; provided, however, that the right to
terminate this Agreement under this Section 7.01(2)(a)shall not be
available to any Party whose breach of any provision of this Agreement
has resulted in the failure of the transactions contemplated hereby to
occur on or before the End Date; or
-26-
(b) there shall be any Applicable Law that makes consummation of all of
the transactions contemplated hereby illegal or otherwise prohibited
or any judgment, injunction, order or decree of any Governmental
Entity having competent jurisdiction enjoining the Purchaser or the
Vendor from consummating all of the transactions contemplated hereby
is entered and such judgment, injunction, order or decree shall have
become final and non-appealable and, prior to such termination, the
Parties shall have used their respective commercially reasonable best
efforts to resist, resolve or lift, as applicable, such judgment,
injunction, order or decree; or
(c) by written notice from the Purchaser, if a breach of any
representation, warranty, covenant or agreement on the part of the
Vendor set forth herein shall have occurred, is not cured within
thirty (30) days after written notice thereof from the Purchaser to
the Vendor, would cause the conditions set forth in Section 5.02(1)(a)
or (b) hereof not to be satisfied, and such condition shall be
incapable of being satisfied by the End Date; or
(d) by written notice from the Vendor, if a breach of any representation,
warranty, covenant or agreement on the part of the Purchaser set forth
herein shall have occurred, is not cured within thirty (30) days after
written notice thereof from the Vendor to the Purchaser, would cause
the conditions set forth in Section 5.03(1)(a) or (b) hereof not to be
satisfied, and such condition shall be incapable of being satisfied by
the End Date.
7.02 EFFECT OF TERMINATION
Termination of this Agreement pursuant to Section 7.01 hereof shall
terminate all rights and obligations of the Parties hereunder and this Agreement
shall become void and have no force or effect. Upon such termination, none of
the Parties shall have any liability to the other Parties hereunder.
Notwithstanding the foregoing, no Party shall be relieved from any liability for
any breach of any of its covenants or agreements in this Agreement prior to such
termination.
ARTICLE 8 - GENERAL
8.01 FURTHER ASSURANCES
Each of the Vendor and the Purchaser shall from time to time execute
and deliver all such further documents and instruments and do all acts and
things as the other party may, either before or after the Closing Date,
reasonably require to effectively carry out or better evidence or perfect the
full intent and meaning of this Agreement.
8.02 TIME OF THE ESSENCE
Time shall be of the essence of this Agreement.
-27-
8.03 COMMISSIONS
Each Party shall indemnify and save harmless the other from and
against any claims whatsoever for any commission, brokers fees, finders fees or
other similar remuneration payable or alleged to be payable to any Person by the
Party providing the indemnity in respect of the sale and purchase of the Shares.
8.04 CONFIDENTIALITY AND PUBLIC ANNOUNCEMENTS
Neither Party shall make any public announcement or press releases
concerning, or otherwise disclose the existence or the contents of, this
Agreement without the prior written consent of the other except as required by
Applicable Law, stock exchange regulation or, in the case of the Vendor and its
Affiliates (including Fundata) the terms of any Contract in effect on the date
hereof.
8.05 BENEFIT OF THE AGREEMENT
This Agreement shall enure to the benefit of and be binding upon the
respective heirs, executors, administrators, successors and permitted assigns of
the parties hereto including each successor in interest of the Vendor (including
Xxxxxxxxx Canadian Publishing Holdings Co.) and the nominee of the Purchaser
that acquires the Shares from the Vendor at Closing.
8.06 ENTIRE AGREEMENT
This Agreement (together with the Schedules and the Disclosure Letter)
constitutes the entire agreement between the parties hereto with respect to the
subject matter hereof and cancels and supersedes any prior understandings and
agreements between the parties hereto with respect thereto (including the Letter
of Intent). There are no representations, warranties, terms, conditions,
undertakings or collateral agreements, express, implied or statutory, between
the parties other than as expressly set forth in this Agreement.
8.07 AMENDMENTS AND WAIVER
No modification of or amendment to this Agreement shall be valid or
binding unless set forth in writing and duly executed by both of the parties
hereto and no waiver of any breach of any term or provision of this Agreement
shall be effective or binding unless made in writing and signed by the party
purporting to give the same and, unless otherwise provided, shall be limited to
the specific breach waived.
8.08 ASSIGNMENT
This Agreement may not be assigned by either the Vendor or the
Purchaser without the prior written consent of the other.
8.09 NOTICES
Any demand, notice or other communication to be given in connection
with this Agreement shall be given in writing and shall be given by personal
delivery, by registered mail or by electronic means of communication addressed
to the recipient as follows:
-28-
To the Vendor:
c/x Xxxxxxxxx International Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
00000
Facsimile No.: (000) 000-0000
Attention: General Counsel
With a copy to:
XxXxxxxx Xxxxxxxx XXX
Xxxxx 0000, 00 Xxxxxxxxxx Xxxxxx West
TD Xxxx Xxxxx, XX Xxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Facsimile No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx
To the Purchaser:
Glacier Ventures International Corp.
0000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0
Facsimile No.: (000) 000-0000
Attention: Xxxxxxxx Xxxxxxx
-29-
With a copy to:
Farris, Vaughan, Xxxxx & Xxxxxx LLP
P.O. Box 10026, 000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0
Facsimile No.: (000) 000-0000
Attention: Xxxxxxxxx Xxxxxxxx
To Xxxxxxxxx International:
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
00000
Facsimile No.: (000) 000-0000
Attention: General Counsel
With a copy to:
XxXxxxxx Xxxxxxxx XXX
Xxxxx 0000, 00 Xxxxxxxxxx Xxxxxx West
TD Xxxx Xxxxx, XX Xxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Facsimile No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx
or to such other address, individual or electronic communication number as may
be designated by notice given by either party to the other. Any demand, notice
or other communication given by personal delivery shall be conclusively deemed
to have been given on the day of actual delivery thereof and, if given by
registered mail, on the second Business Day following the deposit thereof in the
mail and, if given by electronic communication, on the day of transmittal
thereof if given during the normal business hours of the recipient and on the
Business Day during which such normal business hours next occur if not given
during such hours on any day. If the party giving any demand, notice or other
communication knows or ought reasonably to know of any difficulties with the
postal system which might affect the delivery of mail, any such demand, notice
or other communication shall not be mailed but shall be given by personal
delivery or by electronic communication.
-30-
8.10 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 any
Party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the Parties shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
Parties as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the extent possible.
8.11 PARTIES IN INTEREST
This Agreement shall be binding upon, inure solely to the benefit of
and be enforceable by each Party and their respective successors and assigns
hereto, and nothing in this Agreement, express or implied, is intended to or
shall confer upon any other Person (including, without limitation, any lenders
to the Purchaser) other than the Parties any right, benefit or remedy of any
nature whatsoever under or by reason of this Agreement.
8.12 EXPENSES
Except as otherwise expressly set forth in this Agreement all fees and
expenses incurred in connection herewith and the transactions contemplated
hereby shall be paid by the Party incurring such expenses, whether or not the
transactions contemplated hereby are consummated. Notwithstanding the foregoing
or anything to the contrary contained herein, in the event that any dispute
among the Parties results in litigation, arbitration, mediation or any other
contest, the prevailing party in such dispute shall be entitled to recover from
the losing party all fees, costs and expenses of enforcing any right of such
prevailing party with respect to this Agreement, including, without limitation,
reasonable attorney's fees and expenses.
8.13 GOVERNING LAW; ATTORNMENT
This Agreement shall be governed by, and construed in accordance with,
the law of the Province of Ontario and the laws of Canada applicable therein.
For the purposes of all legal proceedings, this Agreement shall be deemed to
have been performed in the Province of Ontario and the courts of the Province of
Ontario shall have jurisdiction to entertain any action arising under this
Agreement. Each of the Parties hereby irrevocably and unconditionally attorn to
the exclusive jurisdiction of the courts of the Province of Ontario located in
the City of Toronto, for any litigation arising out of or relating to this
Agreement and the transactions contemplated hereby, and further agrees that
service of any process, summons, notice or document by Canadian registered mail
to its respective address set forth herein shall be effective service of process
for any litigation brought against it in any such court. It is understood and
agreed that upon service of an originating process by registered mail as
provided herein, the solicitors for the plaintiffs in the action may accept
service of the Statement of Claim on behalf of the solicitors for the defendants
in the action, effective on the fifth day following mailing of the Statement of
Claim, and may thereafter take whatever steps are permitted under the Ontario
Rules of Civil Procedure in respect of an originating process for which service
has been accepted by a solicitor. Each of the Parties hereby irrevocably and
unconditionally
-31-
waives any objection to the laying of venue of any litigation arising out of
this Agreement and the transactions contemplated hereby in the courts of the
Province of Ontario, and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such litigation
brought in any such court has been brought in an inconvenient forum.
8.14 COUNTERPARTS; FACSIMILE
This Agreement may be executed and delivered in one or more
counterparts and via facsimile, and by the Parties in separate counterparts,
each of which when executed and delivered shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.
8.15 WAIVER
Subject to the limitations contained in this Agreement, the failure of
a party to require performance of any provision hereof shall not affect its
right at a later time to enforce the same. No waiver by a party of any term,
covenant, representation or warranty contained herein shall be effective unless
in writing. No such waiver in any one instance shall be deemed a further or
continuing waiver of any such term, covenant, representation or warranty in any
other instance.
8.16 DISCLAIMER
The Vendor disclaims any representations or warranties except as
specifically set forth in this Agreement. In particular, the Vendor disclaims
any representation or warranty, and the Purchaser agrees that the Vendor shall
not have any liability, with respect to any information concerning the Vendor,
the Corporation, and Fundata not expressly represented and warranted to in this
Agreement, including, without limitation, any information regarding the Vendor,
the Corporation, and Fundata provided at any management presentation related to
the transactions contemplated by this Agreement.
8.17 WAIVER OF JURY TRIAL
Each Party hereby waives to the fullest extent permitted by Applicable
Law, any right it may have to a trial by jury in respect of any litigation
directly or indirectly arising out of, under or in connection with this
Agreement or any transaction contemplated hereby.
-32-
IN WITNESS WHEREOF the parties have executed this Agreement.
GLACIER VENTURES INTERNATIONAL CORP.
Per:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
Per:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
HCPH CANADIAN NEWSPAPER HOLDINGS CO.
Per:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
XXXXXXXXX INTERNATIONAL INC.
Per:
-----------------------------------
Name:
----------------------------------
Title:
---------------------------------
SCHEDULE 1.01(N)
DISCLOSURE LETTER
SCHEDULE 3.01(1)(Y)
FUNDATA FINANCIAL STATEMENTS
SCHEDULE 4.05
XXXXXXXXX PRE-CLOSING REORGANIZATION STEPS
SCHEDULE 5.01(1)(B)
CONSENTS AND FILINGS
