Document/Exhibit Description Pages Size
1: 8-K Form 8-K Dated August 30,1996 5 15K
2: EX-2.1 Combination Agreement Dated August 16,1996 46 203K
3: EX-4.1 Voting and Exchange Trust Agreement 41 113K
4: EX-4.2 Registration Rights Agreement 11 44K
5: EX-99.1 Press Release 3 8K
EXHIBIT 4.1
VOTING AND EXCHANGE TRUST AGREEMENT
THIS AGREEMENT made as of the 30th day of August, 1996.
AMONG:
MCAFEE ASSOCIATES, INC.,
a corporation existing under the laws of the State of
Delaware, (hereinafter referred to as the "Parent"),
- and -
FSA COMBINATION CORP.,
a corporation existing under the laws of the State of Delaware
and an indirect subsidiary of the Parent,
(hereinafter referred to as the "Sub"),
- and -
FSA CORPORATION,
a corporation existing under the laws of the Province of
Alberta, (hereinafter referred to as the "Company"),
- and -
JOHN T. RAMSAY
(hereinafter referred to as the "Trustee"),
WHEREAS, pursuant to a combination agreement dated as of
August 16, 1996, by and between the Parent, Sub, an indirect subsidiary of
Parent, the Company and Daniel Freedman (such agreement as it may be amended or
restated is hereinafter referred to as the
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"Combination Agreement"), the parties agreed that on the Effective Date (as
defined in the Combination Agreement), the Parent and the Company would execute
and deliver a Voting and Exchange Trust Agreement containing the terms and
conditions set forth in Exhibit 7.2(b)(ii) to the Combination Agreement together
with such other terms and conditions as may be agreed to by the parties to the
Combination Agreement acting reasonably;
AND WHEREAS, pursuant to articles of amendment (the
"Articles") dated August 26, 1996 filed pursuant to the Business Corporations
Act (Alberta), each issued and outstanding Class A Share of the Company (a
"Company Common Share") was exchanged for 0.355932 issued and outstanding
Exchangeable Non-Voting Shares of the Company (the "Exchangeable Shares"), and
each issued and outstanding Class C Preferred Share of the Company (a "Company
Preferred Share") was exchanged for 11.073 issued and outstanding Exchangeable
Shares, and thereafter, the Company's sole issued and outstanding Class E
Preferred Share was exchanged by the holder thereof for one issued and
outstanding Class A Share;
AND WHEREAS, the above-mentioned Articles set forth the
rights, privileges, restrictions and conditions (collectively the "Exchangeable
Share Provisions") attaching to the Exchangeable Shares;
AND WHEREAS, the Parent is to provide voting rights in the
Parent to each holder (other than the Parent and its subsidiaries) from time to
time of Exchangeable Shares, such voting rights per Exchangeable Share to be
equivalent to the voting rights per share of the Parent common stock (the
"Parent Common Stock");
AND WHEREAS, the Parent is to grant to and in favour of the
holders (other than the Parent and its subsidiaries) from time to time of
Exchangeable Shares the right under the circumstances set forth herein, to
require the Parent to purchase from each such holder all or any part of the
Exchangeable Shares held by the holder;
AND WHEREAS, the parties desire to make appropriate provisions
and to establish a procedure whereby voting rights in the Parent shall be
exercisable by holders (other
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than the Parent and its subsidiaries) from time to time of Exchangeable Shares
by and through the Trustee, which will hold legal title to one share of Series A
Preferred Stock to which voting rights attach for the benefit of such holders
and whereby the rights to require the Parent to purchase Exchangeable Shares
from the holders thereof (other than the Parent and its subsidiaries) shall be
exercisable by such holders from time to time of Exchangeable Shares and through
the Trustee, which will hold legal title to such rights for the benefit of such
holders;
AND WHEREAS, these recitals and any statements of fact in this
trust agreement are made by the Parent, Sub and the Company and not by the
Trustee;
NOW THEREFORE in consideration of the respective covenants and
agreements provided in this trust agreement and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the parties agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this trust agreement, the following terms shall have the
following meanings:
"AFFILIATE" of any person means any other person directly or
indirectly controlled by, or under common control of, that
person. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlled
by" and "under common control of") as applied to any person,
means the possession by another person, directly or
indirectly, of the power to direct or cause the direction of
the management and policies of that first mentioned person,
whether through the ownership of voting securities, by
contract or otherwise.
"AUTOMATIC EXCHANGE RIGHTS" means the benefit of the
obligation of the Parent to effect the automatic exchange of
shares of Parent Common Stock for Exchangeable Shares pursuant
to section 5.11 hereof.
"BOARD OF DIRECTORS" means the Board of Directors of the
Company.
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"BUSINESS DAY" means a day other than a Saturday, Sunday or a
statutory holiday in the City of Calgary, Alberta or the City
of Santa Clara, California.
"CANADIAN DOLLAR EQUIVALENT" means in respect of an amount
expressed in a foreign currency (the "Foreign Currency
Amount") at any date the product obtained by multiplying (a)
the Foreign Currency amount by (b) the noon spot exchange rate
on such date for such foreign currency expressed in Canadian
dollars as reported by the Bank of Canada or, in the event
such spot exchange rate is not available, such exchange rate
on such date for such foreign currency expressed in Canadian
dollars as may be deemed by the Board of Directors to be
appropriate for such purpose.
"CURRENT MARKET PRICE" means, in respect of a share of Parent
Common Stock on any date, the Canadian Dollar Equivalent of
the average of the closing sale price of shares of Parent
Common Stock during a period of 20 consecutive trading days
ending five trading days before such date on the Nasdaq
National Market, or, if the shares of Parent Common Stock are
not then quoted on the Nasdaq National Market, on such other
stock exchange or automated quotation system on which the
shares of Parent Common Stock are listed or quoted, as the
case may be, as may be selected by the Board of Directors for
such purpose.
"EXCHANGE RATIO" has the meaning ascribed thereto in the
Exchangeable Share Provisions.
"EXCHANGE RIGHT" has the meaning ascribed thereto in Section
5.1 hereof.
"EXCHANGEABLE SHARE PROVISIONS" means the rights, privileges,
restrictions and conditions attaching to the Exchangeable
Shares.
"EXCHANGEABLE SHARES" has the meaning ascribed thereto in the
recitals hereto.
"HOLDER VOTES" has the meaning ascribed thereto in Section 4.2
hereof.
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"HOLDERS" means the registered holders from time to time of
Exchangeable Shares, other than the Parent and its
subsidiaries.
"INSOLVENCY EVENT" means the institution by the Company of any
proceeding to be adjudicated a bankrupt or insolvent or to be
dissolved or wound up, or the consent of the Company to the
institution of bankruptcy, insolvency, dissolution or winding
up proceedings against it, or the filing of a petition, answer
or consent seeking dissolution or winding up under any
bankruptcy, insolvency or analogous laws, including without
limitation the Companies Creditors' Arrangement Act (Canada)
and the Bankruptcy and Insolvency Act (Canada), and the
failure by the Company to contest in good faith any such
proceedings commenced in respect of the Company within 15 days
of becoming aware thereof, or the consent by the Company to
the filing of any such petition or to the appointment of a
receiver, or the making by the Company of a general assignment
for the benefit of creditors, or the admission in writing by
the Company of its inability to pay its debts generally as
they become due, or the Company not being permitted, pursuant
to solvency requirements of applicable law, to redeem any
Retracted Shares pursuant to Section 6.6 of the Exchangeable
Share Provisions.
"LIQUIDATION CALL RIGHT" has the meaning ascribed thereto in
section 5.4 of the Exchangeable Share Provisions.
"LIQUIDATION EVENT" has the meaning ascribed thereto in
subsection 5.11(b) hereof.
"LIQUIDATION EVENT EFFECTIVE DATE" has the meaning ascribed
thereto in subsection 5.11(c) hereof.
"LIST" has the meaning subscribed thereto in section 4.6
hereof.
"OFFICER'S CERTIFICATE" means, with respect to the Parent or
the Company, as the case may be, a certificate signed by any
one of the Chairman of the Board, the Vice-Chairman of the
Board, the President, any Vice-President or any other senior
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officer of the Parent or the Company, as the case may be.
"PARENT COMMON STOCK" has the meaning ascribed thereto in the
recitals hereto.
"PARENT CONSENT" has the meaning ascribed thereto in section
4.2 hereof.
"PARENT MEETING" has the meaning ascribed thereto in section
4.2 hereof.
"PERSON" includes an individual, partnership, corporation,
company, unincorporated syndicate or organization, trust,
trustee, executor, administrator and other legal
representative.
"REDEMPTION CALL RIGHT" has the meaning ascribed thereto in
Section 7.4 of the Exchangeable Share Provisions.
"RETRACTED SHARES" has the meaning ascribed thereto in section
5.7 hereof.
"RETRACTION CALL RIGHT" has the meaning ascribed thereto in
section 6.1 of the Exchangeable Share Provisions.
"SUPPORT AGREEMENT" means that certain support agreement made
as of even date hereof between the Company and the Parent.
"TRUST" means the trust created by this agreement.
"TRUST ESTATE" means the Voting Share, any other securities,
the Exchange Right, the Automatic Exchange Rights and any
money or other property which may be held by the Trustee from
time to time pursuant to this trust agreement.
"TRUSTEE" means John T. Ramsay and, subject to the provisions
of Article 10 hereof, includes any successor trustee or
permitted assigns.
"VOTING RIGHTS" means the voting rights attached to the Voting
Share.
"VOTING SHARE" means the one share of Series A Preferred
Stock, U.S. $0.01 par value, issued by the Parent and
delivered by Sub to and deposited with the
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Trustee, which entitles the holder of record to a number of
votes at meetings of holders of Parent Common Stock equal to
the number of shares of Parent Common Stock issuable upon
exchange of then outstanding Exchangeable Shares other than
Exchangeable Shares held by the Parent and its subsidiaries.
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.
The division of this trust agreement into articles, sections
and paragraphs and the insertion of headings are for convenience of reference
only and shall not affect the construction or interpretation of this trust
agreement.
1.3 NUMBER, GENDER, ETC.
Words importing the singular number only shall include the
plural and vice versa. Words importing the use of any gender shall include all
genders.
1.4 DATE FOR ANY ACTION.
If any date on which any action is required to be taken under
this trust agreement is not a Business Day, such action shall be required to be
taken on the next succeeding Business Day.
ARTICLE 2
PURPOSE OF AGREEMENT
2.1 ESTABLISHMENT OF TRUST.
The purpose of this trust agreement is to create the Trust for
the benefit of the Holders, as herein provided. The Trustee will hold the Voting
Share in order to enable the Trustee to exercise the Voting Rights and will hold
the Exchange Right and the Automatic Exchange Rights in order to enable the
Trustee to exercise such rights, in each case as trustee for and on behalf of
the Holders as provided in this trust agreement.
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ARTICLE 3
VOTING SHARE
3.1 ISSUE AND OWNERSHIP OF THE VOTING SHARE.
Sub hereby issues to and deposits with the Trustee the Voting
Share to be hereafter held of record by the Trustee as trustee for and on behalf
of, and for the use and benefit of, the Holders and in accordance with the
provisions of this trust agreement. Sub hereby acknowledges receipt from the
Trustee as trustee for and on behalf of the Holders of good and valuable
consideration (and the adequacy thereof) for the transfer of the Voting Share by
the Sub to the Trustee. During the term of the Trust and subject to the terms
and conditions of this trust agreement, the Trustee shall possess and be vested
with full legal ownership of the Voting Share and shall be entitled to exercise
all of the rights and powers of an owner with respect to the Voting Share,
provided that the Trustee shall:
(a) hold the Voting Share and the legal title thereto as trustee
solely for the use and benefit of the Holders in accordance
with the provisions of this trust agreement, and
(b) except as specifically authorized by this trust agreement,
have no power or authority to sell, transfer, vote or
otherwise deal in or with the Voting Share and the Voting
Share shall not be used or disposed of by the Trustee for any
purpose other than the purposes for which this Trust is
created pursuant to this trust agreement.
3.2 LEGENDED SHARE CERTIFICATES.
The Company will cause each certificate representing
Exchangeable Shares to bear an appropriate legend notifying the Holders of their
right to instruct the Trustee with respect to the exercise of the Voting Rights
with respect to the Exchangeable Shares held by a Holder.
3.3 SAFE KEEPING OF CERTIFICATE.
The certificate representing the Voting Share shall at all
times be held in safe keeping by the Trustee or its agent.
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ARTICLE 4
EXERCISE OF VOTING RIGHTS
4.1 VOTING RIGHTS.
The Trustee, as the holder of record of the Voting Share,
shall be entitled to all of the Voting Rights, including the right to consent to
or to vote in person or by proxy the Voting Share, on any matter, question or
proposition whatsoever that may properly come before the stockholders of the
Parent at a Parent Meeting or in connection with a Parent Consent (in each case,
as hereinafter defined). The Voting Rights shall be and remain vested in and
exercised by the Trustee. Subject to section 7.15 hereof, the Trustee shall
exercise the Voting Rights only on the basis of instructions received pursuant
to this Article 4 from Holders entitled to instruct the Trustee as to the voting
thereof at the time at which the Parent Consent is sought or the Parent Meeting
is held. To the extent that no instructions are received from a Holder with
respect to the Voting Rights to which such Holder is entitled, the Trustee shall
not exercise or permit the exercise of such Holder's Voting Rights.
4.2 NUMBER OF VOTES.
With respect to all meetings of stockholders of the Parent at
which holders of shares of Parent Common Stock are entitled to vote (a "Parent
Meeting") and with respect to all written consents sought by the Parent from its
stockholders including the holders of shares of Parent Common Stock (a "Parent
Consent"), each Holder shall be entitled to instruct the Trustee to cast and
exercise, in the manner instructed, the votes comprised in the Voting Rights for
each Exchangeable Share owned of record by such Holder on the record date
established by the Parent or by applicable law for such Parent Meeting or Parent
Consent, as the case may be (the "Holder Votes"), in respect of each matter,
question or proposition to be voted on at such Parent Meeting or to be consented
to in connection with such Parent Consent.
4.3 MAILINGS TO SHAREHOLDERS.
With respect to each Parent Meeting and Parent Consent, the
Trustee will mail or cause to be mailed (or otherwise communicate in the same
manner as the Parent utilizes in communications to holders of Parent Common
Stock, subject to the Trustee's ability to provide
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this method of communication and upon being advised in writing of such method)
to each of the Holders named in the List on the same day as the initial mailing
or notice (or other communication) with respect thereto is given by the Parent
to its stockholders:
(a) a copy of such notice, together with any proxy or information
statement and related materials to be provided to stockholders
of the Parent;
(b) a statement that such Holder is entitled to instruct the
Trustee as to the exercise of the Holder Votes with respect to
such Parent Meeting or Parent Consent, as the case may be;
(c) a statement as to the manner in which such instructions may be
given to the Trustee, including an express indication that
instructions may be given to the Trustee to give:
(i) a proxy to such Holder or his designee to exercise
personally the Holder Votes; or
(ii) a proxy to a designated agent or other representative
of the management of the Parent to exercise such
Holder Votes;
(d) a statement that if no such instructions are received
from the Holder, the Holder Votes to which such
Holder is entitled will not be exercised;
(e) a form of direction whereby the Holder may so direct and
instruct the Trustee as contemplated herein; and
(f) a statement of (i) the time and date by which such
instructions must be received by the Trustee in order to be
binding upon it, which in the case of a Parent Meeting shall
not be earlier than the close of business on the second
Business Day prior to such meeting, and (ii) the method for
revoking or amending such instructions.
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The materials referred to above are to be provided by the Parent to the Trustee,
but shall be subject to review and comment by the Trustee.
For the purpose of determining Holder Votes to which a Holder
is entitled in respect of any such Parent Meeting or Parent Consent, the number
of Exchangeable Shares owned of record by the Holder shall be determined at the
close of business on the record date established by the Parent or by applicable
law for purposes of determining stockholders entitled to vote at such Parent
Meeting or to give written consent in connection with such Parent Consent. The
Parent will notify the Trustee in writing of any decision of the Board of
Directors of the Parent with respect to the calling of any such Parent Meeting
or the seeking of any such Parent Consent and shall provide all necessary
information and materials to the Trustee in each case promptly and in any event
in sufficient time to enable the Trustee to perform its obligation contemplated
by this section 4.3.
4.4 COPIES OF STOCKHOLDER INFORMATION.
The Parent will deliver to the Trustee at the same time as
such materials are first sent to holders of Parent Common Stock, copies of all
proxy materials, (including notices of Parent Meetings but excluding proxies to
vote shares of Parent Common Stock), information statements, reports (including
without limitation all interim and annual financial statements) and other
written communications that are to be distributed from time to time to holders
of Parent Common Stock in sufficient quantities so as to enable the Trustee to
send those materials to each Holder. The Trustee will promptly mail or otherwise
send to each Holder, at the expense of Parent, copies of all such materials (and
all materials specifically directed to the Holders or to the Trustee for the
benefit of the Holders by the Parent) received by the Trustee from the Parent.
4.5 OTHER MATERIALS.
Promptly after receipt by the Parent or any stockholder of the
Parent of any material sent or given generally to the holders of Parent Common
Stock by or on behalf of a third party, including without limitation dissident
proxy and information circulars (and related information and material) and
tender and exchange offer circulars (and related information and material), the
Parent shall use its best efforts to obtain and deliver to the Trustee copies
thereof in
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sufficient quantities so as to enable the Trustee to forward such material
(unless the same has been provided directly to Holders by such third party) to
each Holder as soon as possible thereafter. As soon as practicable after receipt
thereof, the Trustee will mail or otherwise send to each Holder, at the expense
of the Parent, copies of all such materials received by the Trustee from the
Parent.
4.6 LIST OF PERSONS ENTITLED TO VOTE
The Company shall forthwith upon each request made at any time
by the Trustee in writing, prepare or cause to be prepared a list (a "List") of
the names and addresses of the Holders showing the number of Exchangeable Shares
held of record by each such Holder, in each case at the close of business on the
date specified by the Trustee in such request. Each such List shall be delivered
to the Trustee promptly after receipt by the Company of such request and in any
event within sufficient time as to enable the Trustee to perform its obligations
under this Agreement.
4.7 ENTITLEMENT TO DIRECT VOTES
Any Holder named in a List prepared in connection with any
Parent Meeting or any Parent Consent will be entitled (a) to instruct the
Trustee in the manner described in section 4.3 hereof with respect to the
exercise of the Holder Votes to which such Holder is entitled or (b) to attend
such meeting and personally to exercise thereat (or to exercise with respect to
any written consent), as the proxy of the Trustee, the Holder Votes to which
such Holder is entitled except, in each case, to the extent that such Holder has
transferred the ownership of any Exchangeable Shares in respect of which such
Holder is entitled to Holder Votes after the close of business on the record
date for such meeting or seeking of consent.
4.8 VOTING BY TRUSTEE, AND ATTENDANCE OF TRUSTEE REPRESENTATIVE, AT MEETING
In connection with each Parent Meeting and Parent Consent, the
Trustee shall exercise, either in person or by proxy, in accordance with the
instructions received from a Holder pursuant to section 4.3 hereof, the Holder
Votes as to which such Holder is entitled to direct the vote (or any lesser
number thereof as may be set forth in the instructions); provided, however,
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that such written instructions are received by the Trustee from the Holder prior
to the time and date fixed by it for receipt of such instructions in the notice
given by the Trustee to the Holder pursuant to section 4.3 hereof.
4.9 TERMINATION OF VOTING RIGHTS
All of the rights of a Holder with respect to the Holder Votes
exercisable in respect of the Exchangeable Shares held by such Holder, including
the right to instruct the Trustee as to the voting of or to vote personally such
Holder Votes, shall be deemed to be surrendered by the Holder to the Parent and
such Holder Votes and the Voting Rights represented thereby shall cease
immediately upon the delivery by such holder to the Trustee of the certificates
representing such Exchangeable Shares in connection with the exercise by the
Holder of the Exchange Right or the occurrence of the automatic exchange of
Exchangeable Shares for shares of Parent Common Stock, as specified in Article 5
hereof (unless in either case the Parent shall not have delivered the requisite
shares of the Parent Common Stock issuable in exchange therefor to the Trustee
for delivery to the Holders), or upon the redemption of Exchangeable Shares
pursuant to Article 6 or Article 7 of the Exchangeable Share Provisions, or upon
the effective date of the liquidation, dissolution or winding-up of the Company
pursuant to Article 5 of the Exchangeable Share Provisions, or upon the purchase
of Exchangeable Shares from the holder thereof by the Parent pursuant to the
exercise by the Parent of the Retraction Call Right, the Redemption Call Right
or the Liquidation Call Right.
ARTICLE 5
EXCHANGE RIGHT AND AUTOMATIC EXCHANGE
5.1 GRANT AND OWNERSHIP OF THE EXCHANGE RIGHT
The Parent hereby grants to the Trustee as trustee for and on
behalf of, and for the use and benefit of, the Holders (a) the right (the
"Exchange Right"), upon the occurrence and during the continuance of an
Insolvency Event, to require the Parent, either directly or indirectly through
one of its subsidiaries, to purchase from each or any Holder all or any part of
the Exchangeable Shares held by the Holder and (b) the Automatic Exchange
Rights, all in accordance with the provisions of this agreement. The Parent
hereby acknowledges receipt from
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the Trustee as trustee for and on behalf of the Holders of good and valuable
consideration (and the adequacy thereof) for the grant of the Exchange Right and
the Automatic Exchange Rights by the Parent to the Trustee. During the term of
the Trust and subject to the terms and conditions of this trust agreement, the
Trustee shall possess and be vested with full legal ownership of the Exchange
Right and the Automatic Exchange Rights and shall be entitled to exercise all of
the rights and powers of an owner with respect to the Exchange Right and the
Automatic Exchange Rights, provided that the Trustee shall:
(a) hold the Exchange Right and the Automatic Exchange Rights and
the legal title thereto as trustee solely for the use and
benefit of the Holders in accordance with the provisions of
this trust agreement; and
(b) except as specifically authorized by this trust agreement,
have no power or authority to exercise or otherwise deal in or
with the Exchange Right or the Automatic Exchange Rights and
the Trustee shall not exercise any such rights for any purpose
other than the purposes for which this Trust is created
pursuant to this trust agreement.
5.2 LEGENDED SHARE CERTIFICATES
The Company will cause each certificate representing
Exchangeable Shares to bear an appropriate legend notifying the Holders of:
(a) their right to instruct the Trustee with respect to the
exercise of the Exchange Right in respect of the Exchangeable
Shares held by a Holder; and
(b) the Automatic Exchange Rights.
5.3 GENERAL EXERCISE OF EXCHANGE RIGHT
The Exchange Right shall be and remain vested in and exercised
by the Trustee. Subject to section 7.15 hereof, the Trustee shall exercise the
Exchange Right only on the basis of instructions received pursuant to this
Article 5 from Holders entitled to instruct the Trustee as to
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the exercise thereof. To the extent that no instructions are received from a
Holder with respect to the Exchange Right, the Trustee shall not exercise or
permit the exercise of the Exchange Right.
5.4 EXCHANGE CONSIDERATION
The exchange consideration (the "Exchange Consideration") to
be delivered by the Parent (either directly or indirectly through one or more of
its subsidiaries) for each Exchangeable Share to be exchanged by the Parent
(either directly or indirectly through one or more of its subsidiaries) under
the Exchange Right shall be an amount per share equal to (a) the Current Market
Price of a share of Parent Common Stock on the last Business Day prior to the
day of transfer of such Exchangeable Shares under the Exchange Right multiplied
by the Exchange Ratio at that time plus (b) an additional amount equivalent to
the full amount of all dividends declared and unpaid on each such Exchangeable
Share (provided that if the record date for any such declared and unpaid
dividends occurs on or after the day of closing of such exchange, the Exchange
Consideration shall not include such additional amount equivalent to the
declared and unpaid dividends). In connection with each exercise of the Exchange
Right, the Parent (either directly or indirectly through one or more of its
subsidiaries) will provide to the Trustee an Officer's Certificate setting forth
the calculation of the Exchange Consideration for each Exchangeable Share. The
Exchange Consideration for each such Exchangeable Share so exchanged may be
satisfied only by the Parent issuing and delivering or causing to be delivered
(either directly or indirectly through one or more of its subsidiaries) to the
Trustee, on behalf of the relevant Holder, the number of shares of Parent Common
Stock equal to the Exchange Ratio at that time and a cheque for the balance, if
any, of the Exchange Consideration without interest thereon.
5.5 EXERCISE INSTRUCTIONS
Subject to the terms and conditions herein set forth, a Holder
shall be entitled, upon the occurrence and during the continuance of an
Insolvency Event, to instruct the Trustee to exercise the Exchange Right with
respect to all or any part of the Exchangeable Shares registered in the name of
such Holder on the books of the Company. To cause the exercise of the Exchange
Right by the Trustee, the Holder shall deliver to the Trustee, in person or by
certified or
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registered mail, at its principal office in Calgary, Alberta or at such other
places in Canada as the Trustee may from time to time designate by written
notice to the Holders, the certificates representing the Exchangeable Shares
which such Holder desires the Parent (either directly or indirectly through one
or more of its subsidiaries) to exchange, duly endorsed in blank, and
accompanied by such other documents and instruments as may be required to effect
a transfer of Exchangeable Shares under the Business Corporations Act (Alberta)
and the by-laws of the Company and such additional documents and instruments as
the Trustee may reasonably require together with (a) a duly completed form of
notice of exercise of the Exchange Right, contained on the reverse of or
attached to the Exchangeable Share certificates, stating (i) that the Holder
thereby instructs the Trustee to exercise the Exchange Right so as to require
the Parent (either directly or indirectly through one or more of its
subsidiaries) to exchange the number of Exchangeable Shares specified therein,
(ii) that such Holder has good title to and owns all such Exchangeable Shares to
be acquired by the Parent free and clear of all liens, claims and encumbrances,
(iii) the names in which the certificates representing the Parent Common Stock
issuable in connection with the exercise of the Exchange Right are to be issued
and (iv) the names and addresses of the person to whom such new certificates
should be delivered and (b) payment (or evidence satisfactory to the Trustee,
the Company and the Parent of payment) of the taxes (if any) payable as
contemplated by section 5.8 of this trust agreement. If only a part of the
Exchangeable Shares represented by any certificate or certificates delivered to
the Trustee are to be exchanged by the Parent under the Exchange Right, a new
certificate for the balance of such Exchangeable Shares shall be issued to the
holder at the expense of the Company.
5.6 DELIVERY OF PARENT COMMON STOCK; EFFECT OF EXERCISE
Promptly after receipt of the certificate representing the
Exchangeable Shares which the Holder desires the Parent (either directly or
indirectly through one or more of its subsidiaries) to purchase under the
Exchange Right (together with such documents and instruments of transfer and a
duly completed form of notice of exercise of the Exchange Right (and payment of
taxes, if any, or evidence thereof)), duly endorsed for transfer to the Parent
and Sub, the Trustee shall notify the Parent, Sub and the Company of its receipt
of the same, which notice to the Parent, Sub and the Company shall constitute
exercise of the Exchange Right by the
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Trustee on behalf of the holder of such Exchangeable Shares, and the Parent
(either directly or indirectly through one or more of its subsidiaries) shall
immediately thereafter deliver or cause to be delivered to the Trustee, for
delivery to the Holder of such Exchangeable Shares (or to such other persons, if
any, properly designated by the Holder), the certificates for the number of
shares of Parent Common Stock issuable in connection with the exercise of the
Exchange Right, which shares shall be duly issued, fully paid and non-assessable
and shall be free and clear of any lien, claim or encumbrance, and cheques for
the balance, if any, of the total Exchange Consideration therefor without
interest, provided, however, that no such delivery shall be made unless and
until the Holder requesting the same shall have paid (or provided evidence
satisfactory to the Trustee, the Company and the Parent of the payment of) the
taxes (if any) payable as contemplated by section 5.8 of this trust agreement.
Immediately upon the giving of notice by the Trustee to the Parent, Sub and the
Company of the exercise of the Exchange Right, as provided in this section 5.6,
the exchange shall be deemed to have occurred, and the Holder of such
Exchangeable Shares shall be deemed to have transferred to the Parent and Sub
all of its right, title and interest in and to such Exchangeable Shares and in
the related interest in the Trust Estate and shall cease to be a holder of such
Exchangeable Shares and shall not be entitled to exercise any of the rights of a
holder in respect thereof, other than the right to receive his proportionate
part of the total Exchange Consideration therefor, unless the requisite number
of shares of Parent Common Stock (together with a cheque for the balance, if
any, of the total Exchange Consideration therefor without interest) is not
allotted, issued and delivered by the Parent to the Trustee, for delivery to
such Holder (or to such other persons, if any, properly designated by such
Holder), within five Business Days of the date of the giving of such notice by
the Trustee, in which case the rights of the Holder shall remain unaffected
until such shares of the Parent Common Stock are so allotted, issued and
delivered by the Parent (either directly or indirectly through one or more of
its subsidiaries) and any such cheque is so delivered and paid. Concurrently
with such Holder ceasing to be a holder of Exchangeable Shares, the Holder shall
be considered and deemed for all purposes to be the holder of the shares of
Parent Common Stock delivered to it pursuant to the Exchange Right.
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5.7 EXERCISE OF EXCHANGE RIGHT SUBSEQUENT TO RETRACTION
In the event that a Holder has exercised its right under
Article 6 of the Exchangeable Share Provisions to require the Company to redeem
any or all of the Exchangeable Shares held by the Holder (the "Retracted
Shares") and is notified by the Company pursuant to Section 6.6 of the
Exchangeable Share Provisions that the Company will not be permitted as a result
of solvency requirements of applicable law to redeem all such Retracted Shares,
subject to receipt by the Trustee of the written notice to that effect from the
Company and provided that the Parent (either directly or indirectly through one
or more of its subsidiaries) shall not have exercised the Retraction Call Right
with respect to the Retracted Shares and that the Holder has not revoked the
retraction request delivered by the Holder to the Company pursuant to Section
6.1 of the Exchangeable Share Provisions, the retraction request will constitute
and will be deemed to constitute notice from the Holder to the Trustee
instructing the Trustee to exercise the Exchange Right with respect to those
Retracted Shares which the Company is unable to redeem. In any such event, the
Company hereby agrees with the Trustee and in favour of the Holder immediately
to notify the Trustee of such prohibition against the Company redeeming all of
the Retracted Shares and immediately to forward or cause to be forwarded to the
Trustee all relevant materials delivered by the Holder to the Company (including
without limitation a copy of the retraction request delivered pursuant to
Section 6.1 of the Exchangeable Share Provisions) in connection with such
proposed redemption of the Retracted Shares and the Trustee will thereupon
exercise the Exchange Right with respect to the Retracted Shares that the
Company is not permitted to redeem and will require the Parent to purchase such
shares in accordance with the provisions of this Article 5.
5.8 STAMP OR OTHER TRANSFER TAXES
Upon any sale of Exchangeable Shares to the Parent (either
directly or indirectly through one or more of its subsidiaries) pursuant to the
Exchange Right or the Automatic Exchange Rights, the share certificate or
certificates representing the Parent Common Stock to be delivered in connection
with the payment of the total purchase price therefor shall be issued in the
name of the Holder of the Exchangeable Shares so sold or in such names as such
Holder may otherwise direct in writing without charge to the holder of the
Exchangeable Shares so sold,
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provided, however, that such Holder (a) shall pay (and neither the Parent, the
Company nor the Trustee shall be required to pay) any documentary, stamp,
transfer or other similar taxes that may be payable in respect of any transfer
involved in the issuance or delivery of such shares to a person other than such
Holder or (b) shall have established to the satisfaction of the Trustee, the
Parent and the Company that such taxes, if any, have been paid.
5.9 NOTICE OF INSOLVENCY EVENT
Immediately upon the occurrence of an Insolvency Event or any
event which with the giving of notice or the passage of time or both would be an
Insolvency Event, the Company and the Parent (either directly or indirectly
through one or more of its subsidiaries) shall give written notice thereof to
the Trustee. As soon as practicable after receiving notice from the Company and
the Parent (either directly or indirectly through one or more of its
subsidiaries) or from any other person of the occurrence of an Insolvency Event,
the Trustee will mail to each Holder, at the expense of the Parent (either
directly or indirectly through one or more of its subsidiaries), a notice of
such Insolvency Event in the form provided by the Parent (either directly or
indirectly through one or more of its subsidiaries), which notice shall contain
a brief statement of the right of the Holders with respect to the Exchange
Right.
5.10 RESERVATION OF SHARES OF PARENT COMMON STOCK
The Parent hereby represents, warrants and covenants that it
has reserved for issuance and will at all times keep available, free from
pre-emptive and other rights, out of its authorized and unissued capital stock
such number of shares of Parent Common Stock (a) as is equal to the sum of the
number of Exchangeable Shares issued and outstanding from time to time,
multiplied by the Exchange Ratio at that time and (b) as are now and may
hereafter be required to enable and permit the Company to meet its obligations
hereunder, under the Support Agreement, under the Exchangeable Share Provisions
and under any other security or commitment pursuant to which the Parent may now
or hereafter be required to issue shares of Parent Common Stock.
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5.11 AUTOMATIC EXCHANGE ON LIQUIDATION OF PARENT
(a) The Parent will give the Trustee written notice of each of the
following events at the time set forth below:
(i) in the event of any determination by the Board of
Directors of the Parent to institute voluntary
liquidation, dissolution or winding-up proceedings
with respect to the Parent or to effect any other
distribution of assets of the Parent among its
stockholders for the purpose of winding up its
affairs, at least 60 days prior to the proposed
effective date of such liquidation, dissolution,
winding-up or other distribution; and
(ii) immediately, upon the earlier of (A) receipt by the
Parent of notice of and (B) the Parent otherwise
becoming aware of any threatened or instituted claim,
suit, petition or other proceedings with respect to
the involuntary liquidation, dissolution or winding
up of the Parent or to effect any other distribution
of assets of the Parent among its stockholders for
the purpose of winding up its affairs.
(b) Immediately following receipt by the Trustee from the Parent
of notice of any event (a "Liquidation Event") contemplated by
section 5.11(a)(i) or 5.11(a)(ii) above, the Trustee will give
notice thereof to the Holders. Such notice will be provided by
the Parent to the Trustee and shall include a brief
description of the automatic exchange of Exchangeable Shares
for shares of Parent Common Stock provided for in section
5.11(c) below.
(c) In order that the Holders will be able to participate on a pro
rata basis with the holders of Parent Common Stock in the
distribution of assets of the Parent in connection with a
Liquidation Event, on the fifth Business Day prior to the
effective date (the "Liquidation Event Effective Date") of a
Liquidation Event all of the then outstanding Exchangeable
Shares shall be automatically exchanged for shares of Parent
Common Stock as provided below. To effect such automatic
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exchange, the Parent (either directly or indirectly through
one or more of its subsidiaries) and the Holder shall exchange
each Exchangeable Share outstanding on the fifth Business Day
prior to the Liquidation Event Effective Date and held by
Holders for an exercise price per share equal to (a) the
Current Market Price of a share of Parent Common Stock on the
fifth Business Day prior to the Liquidation Event Effective
Date multiplied by the Exchange Ratio at that time, which
shall be satisfied by the Parent (either directly or
indirectly through one or more of its subsidiaries) issuing to
the Holder the number of shares of Parent Common Stock equal
to the Exchange Ratio at that time plus (b) an additional
amount equivalent to the full amount of all dividends declared
and unpaid on each such Exchangeable Share and all dividends
declared on the Parent Common Stock that have not been
declared on such Exchangeable Shares in accordance with
Section 3.1 of the Exchangeable Share Provisions (provided
that if the record date for such declared and unpaid dividends
occurs on or after the day of closing of such exchange, the
Exchange Consideration shall not include such additional
amounts equivalent to such declared and unpaid dividends). In
connection with such automatic exchange, the Parent will
provide to the Trustee an Officer's Certificate setting forth
the calculation of the Exchange Consideration for each
Exchangeable Share.
(d) On the fifth Business Day prior to the Liquidation Event
Effective Date, the closing of the automatic exchange of
Exchangeable Shares for Parent Common Stock shall be deemed to
have occurred, and each Holder of Exchangeable Shares shall be
deemed to have transferred to the Parent (either directly or
indirectly through one or more of its subsidiaries) all of the
Holder's right, title and interest in and to such Exchangeable
Shares and the related interest in the Trust Estate and shall
cease to be a holder of such Exchangeable Shares and the
Parent (either directly or indirectly through one or more of
its subsidiaries) shall issue to the Holder the shares of
Parent Common Stock issuable upon the automatic exchange of
Exchangeable Shares for Parent Common Stock and shall deliver
to the Trustee
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for delivery to the Holder a cheque for the balance, if any,
of the total exercise price for such Exchangeable Shares
without interest. Concurrently with such holder ceasing to be
a holder of Exchangeable Shares, the Holder shall be
considered and deemed for all purposes to be the holder of the
shares of Parent Common Stock issued to it pursuant to the
automatic exchange of Exchangeable Shares for Parent Common
Stock and the certificates held by the Holder previously
representing the Exchangeable Shares exchanged by the Holder
with the Parent (either directly or indirectly through one or
more of its subsidiaries) pursuant to such automatic exchange
shall thereafter be deemed to represent the shares of Parent
Common Stock issued to the Holder by the Parent (either
directly or indirectly through one or more of its
subsidiaries) pursuant to such automatic exchange. Upon the
request of a Holder and the surrender by the Holder of
Exchangeable Share certificates deemed to represent shares of
Parent Common Stock, duly endorsed in blank and accompanied by
such instruments of transfer as the Parent (either directly or
indirectly through one or more of its subsidiaries) may
reasonably require, the Parent (either directly or indirectly
through one or more of its subsidiaries) shall deliver or
cause to be delivered to the Holder certificates representing
the shares of Parent Common Stock of which the Holder is the
holder.
ARTICLE 6
RESTRICTIONS ON ISSUE OF SERIES A PREFERRED STOCK
6.1 ISSUE OF ADDITIONAL SHARES
During the term of this trust agreement, the Parent will not
issue any shares of Series A Preferred Stock in addition to the Voting Share.
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ARTICLE 7
CONCERNING THE ISSUE
7.1 POWERS AND DUTIES OF THE TRUSTEE
The rights, powers and authorities of the Trustee under this
trust agreement, in its capacity as trustee of the Trust, shall include:
(a) receipt and deposit of the Voting Share from the Sub as
trustee for and on behalf of the Holders in accordance with
the provisions of this agreement;
(b) granting proxies and distributing materials to Holders as
provided in this trust agreement;
(c) voting the Holder Votes in accordance with the provisions of
this trust agreement;
(d) receiving the grant of the Exchange Right and the Automatic
Exchange Rights from the Parent as trustee for and on behalf
of the Holders in accordance with the provisions of this trust
agreement;
(e) exercising the Exchange Right and enforcing the benefit of the
Automatic Exchange Rights, in each case in accordance with the
provisions of this trust agreement, and in connection
therewith receiving from Holders Exchangeable Shares and other
requisite documents and distributing to such holders the
shares of Parent Common Stock and cheques, if any, to which
such holders are entitled upon the exercise of the Exchange
Right or pursuant to the Automatic Exchange Rights, as the
case may be;
(f) holding title to the Trust Estate;
(g) investing any moneys forming, from time to time, a part of the
Trust Estate as provided in this trust agreement;
(h) taking action at the direction of a Holder or Holders to
enforce the obligations of the Parent under this trust
agreement;
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(i) taking such other actions and doing such other things as are
specifically provided in this trust agreement.
In the exercise of such rights, powers and authorities the
Trustee shall have (and is granted) such incidental and additional rights,
powers and authority not in conflict with any of the provisions of this trust
agreement as the Trustee, acting in good faith and in the reasonable exercise of
its discretion, may deem necessary, appropriate or desirable to effect the
purpose of the Trust. Any exercise of such discretionary rights, powers and
authorities by the Trustee shall be final, conclusive and binding upon all
persons. For greater certainty, the Trustee shall have only those duties as are
set out specifically in this trust agreement.
The Trustee in exercising its rights, powers, duties and
authorities hereunder shall act honestly and in good faith with a view to the
best interests of the Holders and shall exercise the care, diligence and skill
that a reasonably prudent trustee would exercise in comparable circumstances.
The Trustee shall not be bound to give any notice or do or
take any act, action or proceeding by virtue of the powers conferred on it
hereby unless and until it shall be specifically required to do so under the
terms hereof, nor shall the Trustee be required to take any notice of, or to do
or to take any act, action or proceeding as a result of any default or breach of
any provision hereunder, unless and until notified in writing of such default or
breach, which notices shall distinctly specify the default or breach desired to
be brought to the attention of the Trustee and in the absence of such notice the
Trustee may for all purposes of this Agreement conclusively assume that no
default or breach has been made in the observance or performance of any of the
representations, warranties, covenants, agreements or conditions contained
herein.
7.2 NO CONFLICT OF INTEREST
The Trustee represents to the Company, the Sub and the Parent
that at the date of execution and delivery of this trust agreement there exists
no material conflict of interest in the role of the Trustee as a fiduciary
hereunder and the role of the Trustee in any other capacity. The Trustee shall,
within 90 days after it becomes aware that such a material conflict of interest
-25-
exists, either eliminate such material conflict of interest or resign in the
manner and with the effect specified in Article 10 hereof. If, notwithstanding
the foregoing provisions of this section 7.2, the Trustee has such a material
conflict of interest, the validity and enforceability of this trust agreement
shall not be affected in any manner whatsoever by reason only of the existence
of such material conflict of interest. If the Trustee contravenes the foregoing
provisions of this section 7.2, any interested party may apply to the Court of
Queen's Bench of Alberta for an order that the Trustee be replaced as trustee
hereunder.
7.3 DEALINGS WITH TRANSFER AGENTS, REGISTRARS, ETC.
The Company and the Parent irrevocably authorize the Trustee,
from time to time, to:
(a) consult, communicate and otherwise deal with the respective
registrars and transfer agents, and with any such subsequent
registrar or transfer agent, of the Exchangeable Shares and
the Parent Common Stock; and
(b) requisition, from time to time, (i) from any such registrar or
transfer agent any information readily available from the
records maintained by it which the Trustee may reasonably
require for the discharge of its duties and responsibilities
under this trust agreement, and (ii) from the transfer agent
of the Parent Common Stock, and any subsequent transfer agent
of such shares, the share certificates issuable upon the
exercise from time to time of the Exchange Right and pursuant
to the Automatic Exchange Rights in the manner specified in
Article 5 hereof.
The Parent irrevocably authorizes its registrar and transfer
agent to comply with all such requests. The Parent covenants that it will supply
its transfer agent with duly executed share certificates for the purpose of
completing the exercise from time to time of the Exchange Right and the
Automatic Exchange Rights, in each case pursuant to Article 5 hereof.
7.4 BOOKS AND RECORDS
(a) The Trustee shall keep available for inspection by the Parent
and the Company, at the Trustee's principal office in Calgary,
Alberta, correct and complete books and
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records of account relating to the Trustee's actions under
this trust agreement, including without limitation all
information relating to mailings and instructions to and from
the Holders and all transactions pursuant to the Voting
Rights, the Exchange Right and the Automatic Exchange Rights
for the term of this Agreement.
7.5 INCOME TAX RETURNS AND REPORTS
The Trustee shall, to the extent necessary, prepare and file
on behalf of the Trust appropriate United States and Canadian income tax returns
and any other returns or reports as may be acquired by applicable law.
7.6 INDEMNIFICATION PRIOR TO CERTAIN ACTIONS BY TRUSTEE
The Trustee shall exercise any or all of the rights, duties,
powers or authorities vested in it by this trust agreement at the request, order
or direction of any Holder upon such Holder furnishing to the Trustee reasonable
funding, security and indemnity against the costs, expenses and liabilities
which may be incurred by the Trustee herein or thereby, provided that no Holder
shall be obligated to furnish to the Trustee any such funding, security or
indemnity in connection with the exercise by the Trustee of any of its rights,
duties, powers and authorities with respect to the Voting Share pursuant to
Article 4 hereof, subject to Section 7.15 hereof, and with respect to the
Exchange Right pursuant to Article 5 hereof, subject to section 7.15 hereof, and
with respect to the Automatic Exchange Rights pursuant to Article 5 hereof.
None of the provisions contained in this trust agreement shall
require the Trustee to expend or risk its own funds or otherwise incur financial
liability in the exercise of any of its rights, powers, duties or authorities
unless funded, given funds, security and indemnified as aforesaid.
7.7 ACTIONS BY HOLDERS
No Holder shall have the right to institute any action, suit
or proceeding or to exercise any other remedy authorized by this trust agreement
for the purpose of enforcing any of its rights or for the execution of any trust
or power hereunder unless the Holder has requested the
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Trustee to take or institute such action, suit or proceeding and furnished the
Trustee with the funding, security and indemnity referred to in section 7.6
hereof and the Trustee shall have failed to act within a reasonable time
thereafter. In such case, but not otherwise, the Holder shall be entitled to
take proceedings in any court of competent jurisdiction such as the Trustee
might have taken, it being understood and intended that no one or more Holders
shall have any right in any manner whatsoever to affect, disturb or prejudice
the rights hereby created by any such action, or to enforce any right hereunder
or under the Voting Rights, the Exchange Right or the Automatic Exchange Rights,
except subject to the conditions and in the manner herein provided, and that all
powers and trusts hereunder shall be exercised and all proceedings at law shall
be instituted, had and maintained by the Trustee, except only as herein
provided, and in any event for the equal benefit of all Holders.
7.8 RELIANCE UPON DECLARATIONS
The Trustee shall not be considered to be in contravention of
any of its rights, powers, duties and authorities hereunder if, when required,
it acts and relies in good faith upon lists, mailing labels, notices, statutory
declarations, certificates, opinions, reports or other papers or documents
furnished pursuant to the provisions hereof or required by the Trustee to be
furnished to it in the exercise of its rights, powers, duties and authorities
hereunder and such lists, mailing labels, notices, statutory declarations,
certificates, opinions, reports or other papers or documents comply with the
provisions of section 7.9 hereof, if applicable, and with any other applicable
provisions of this trust agreement.
7.9 EVIDENCE AND AUTHORITY TO TRUSTEE.
The Company or the Parent or both shall furnish to the Trustee
evidence of compliance with the conditions provided for in this trust agreement
relating to any action or step required or permitted to be taken by the Company
or the Parent (or both) or the Trustee under this trust agreement or as a result
of any obligation imposed under this trust agreement, including, without
limitation, in respect of the Voting Rights or the Exchange Right or the
Automatic Exchange Rights and the taking of any other action to be taken by the
Trustee at the request of or on the application of the Company or the Parent (or
both) forthwith if and when:
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(a) such evidence is required by any other section of this trust
agreement to be furnished to the Trustee in accordance with
the terms of this section 7.9; or
(b) the Trustee, in the exercise of its rights, powers, duties and
authorities under this trust agreement, gives the Company or
the Parent or both written notice requiring it to furnish such
evidence in relation to any particular action or obligation
specified in such notice.
Such evidence shall consist of an Officer's Certificate of the
Company or the Parent or both, or a statutory declaration or a certificate made
by persons entitled to sign an Officer's Certificate stating that any such
condition has been complied with in accordance with the terms of this trust
agreement.
Whenever such evidence relates to a matter other than the
Voting Rights or the Exchange Right or the Automatic Exchange Rights, and except
as otherwise specifically provided herein, such evidence may consist of a report
or opinion of any solicitor, auditor, accountant, appraiser, valuer, engineer or
other expert or any other person whose qualifications give authority to a
statement made by him, provided that if such report or opinion is furnished by a
director, officer or employee of the Company or the Parent it shall be in the
form of an Officer's Certificate or a statutory declaration.
Each statutory declaration, certificate, opinion or report
furnished to the Trustee as evidence of compliance with a condition provided for
in this trust agreement shall include a statement by the person giving the
evidence:
(a) declaring that he has read and understands the provisions of
this trust agreement relating to the condition in question;
(b) describing the nature and scope of the examination or
investigation upon which he based the statutory declaration,
certificate, statement or opinion; and
(c) declaring that he has made such examination or investigation
as he believes is necessary to enable him to make the
statements or give the opinions contained or expressed
therein.
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7.10 EXPERTS, ADVISERS AND AGENTS
The Trustee may:
(a) in relation to these presents act and rely on the opinion or
advice of or information obtained from or prepared by any
solicitor, auditor, accountant, appraiser, valuer, engineer or
other expert, whether retained by the Trustee or by the
Company or by the Parent or otherwise, and may employ such
assistants as may be necessary to the proper determination and
discharge of its powers and duties and determination of its
rights hereunder and may pay proper and reasonable
compensation for all such legal and other advice or assistance
as aforesaid; and
(b) employ such agents and other assistants as it may reasonably
require for the proper determination and discharge of its
powers and duties hereunder, and may pay reasonable
remuneration for all services performed for it (and shall be
entitled to receive reasonable remuneration for all services
performed by it) in the discharge of the trusts hereof and
compensation for all disbursements, costs and expenses made or
incurred by it in the determination and discharge of its
duties hereunder and in the management of the Trust.
7.11 INVESTMENT OF MONEYS HELD BY TRUSTEE
Unless otherwise provided in this trust agreement, any moneys
held by or on behalf of the Trustee which under the terms of this trust
agreement may or ought to be invested or which may be on deposit with the
Trustee or which may be in the hands of the Trustee may be invested and
reinvested in the name or under the control of the Trustee in securities in
which, under the laws of the Province of Alberta, trustees are authorized to
invest trust moneys, provided that such securities are stated to mature within
two years after their purchase by the Trustee, and the Trustee shall so invest
such moneys on the written direction of the Company. Pending the investment of
all moneys as hereinbefore provided, such moneys may be deposited in the name of
the Trustee in any chartered bank in Canada or, with the consent of the Company,
in the deposit department of the Trustee or any other loan or trust company
authorized to accept
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deposits under the laws of Canada or any province thereof at the rate of
interest then current on similar deposits.
7.12 TRUSTEE NOT REQUIRED TO GIVE SECURITY
The Trustee shall not be required to give any bond or security
in respect of the execution of the trusts, rights, duties, powers and
authorities of this trust agreement or otherwise in respect of the premises.
7.13 TRUSTEE NOT BOUND TO ACT ON COMPANY'S REQUEST
Except as in this trust agreement otherwise specifically
provided, the Trustee shall not be bound to act in accordance with any direction
or request of the Company or the Parent or of the directors thereof until a duly
authenticated copy of the instrument or resolution containing such direction or
request shall have been delivered to the Trustee, and the Trustee shall be
empowered to act and rely upon any such copy purporting to be authenticated and
believed by the Trustee to be genuine.
7.14 AUTHORITY TO CARRY ON BUSINESS
The Trustee represents to the Company and the Parent that at
the date of execution and delivery by it of this trust agreement it is
authorized to carry on the business of a trust company in the Province of
Alberta but if, notwithstanding the provisions of this section 7.14, it ceases
to be so authorized to carry on business, the validity and enforceability of
this trust agreement and the Voting Rights, the Exchange Right and the Automatic
Exchange Rights shall not be affected in any manner whatsoever by reason only of
such event but the Trustee shall, within 90 days after ceasing to be authorized
to carry on the business of a trust company in the Province of Alberta, either
become so authorized or resign in the manner and with the effect specified in
Article 10 hereof.
7.15 CONFLICTING CLAIMS
If conflicting claims or demands are made or asserted with
respect to any interest of any Holder in any Exchangeable Shares, including any
disagreement between the heirs, representatives, successors or assigns
succeeding to all or any part of the interest of any Holder in
-31-
any Exchangeable Shares resulting in conflicting claims or demands being made in
connection with such interest, then the Trustee shall be entitled, at its sole
discretion, to refuse to recognize or to comply with any such claim or demand.
In so refusing, the Trustee may elect not to exercise any Voting Rights,
Exchange Right or Automatic Exchange Rights subject to such conflicting claims
or demands and, in so doing, the Trustee shall not be or become liable to any
person on account of such election or its failure or refusal to comply with any
such conflicting claims or demands. The Trustee shall be entitled to continue to
refrain from acting and to refuse to act until:
(a) the rights of all adverse claimants with respect to the Voting
Rights, Exchange Right or Automatic Exchange Rights subject to
such conflicting claims or demands have been adjudicated by a
final judgement of a court of competent jurisdiction; or
(b) all differences with respect to the Voting Rights, Exchange
Right or Automatic Exchange Rights subject to such conflicting
claims or demands have been conclusively settled by a valid
written agreement binding on all such adverse claimants, and
the Trustee shall have been furnished with an executed copy of
such agreement.
If the Trustee elects to recognize any claim or comply with
any demand made by any such adverse claimant, it may in its discretion require
such claimant to furnish such surety bond or other security satisfactory to the
Trustee as it shall deem appropriate fully to indemnify it as between all
conflicting claims or demands.
7.16 ACCEPTANCE OF TRUST
The Trustee hereby accepts the Trust created and provided for
by and in this trust agreement and agrees to perform the same upon the terms and
conditions herein set froth and to hold all rights, privileges and benefits
conferred hereby and by law in trust for the various persons who shall from time
to time be Holders, subject to all the terms and conditions herein set forth.
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ARTICLE 8
COMPENSATION
8.1 FEES AND EXPENSES OF THE TRUSTEE
The Trustee shall be entitled to reasonable compensation from
the Holders for all of the services rendered by it under this trust agreement
and will reimburse the Trustee for all reasonable expenses (including but not
limited to taxes, compensation paid to experts, agents and advisors and travel
expenses) and disbursements, including the cost and expense of any suit or
litigation of any character and any proceedings before any governmental agency
reasonable incurred by the Trustee in connection with its rights and duties
under this trust agreement, provided that the Parent and the Company shall have
no obligation to reimburse the Trustee for any expenses or disbursements paid,
incurred or suffered by the Trustee in any suit or litigation in which the
Trustee is determined to have acted in bad faith or with negligence or willful
misconduct.
ARTICLE 9
INDEMNIFICATION AND LIMITATION OF LIABILITY
9.1 INDEMNIFICATION OF THE TRUSTEE
The Parent and the Company jointly and severally agree to
indemnify and hold harmless the Trustee and each of its directors, officers,
employees and agents appointed and acting in accordance with this trust
agreement (collectively, the "Indemnified Parties") against all claims, losses,
damages, costs, penalties, fines and reasonable expenses (including reasonable
expenses of the Trustee's legal counsel) which, without fraud, negligence,
wilful misconduct or bad faith on the part of such Indemnified Party, may be
paid, incurred or suffered by the Indemnified Party by reason of or as a result
of the Trustee's acceptance or administration of the written instructions
delivered to the Trustee by the Parent or the Company pursuant hereto. In no
case shall the Parent or the Company be liable under this indemnity for any
claim against any of the Indemnified Parties unless the Parent and the Company
shall be notified by the Trustee of the written assertion of a claim or of any
action commenced against the Indemnified Parties, promptly after any of the
Indemnified Parties shall have received any such written assertion of a claim or
shall have been served with a summons or other first legal process giving
information as
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to the nature and basis of the claim. Subject to (ii), below, the Parent and the
Company shall be entitled to participate at their own expense in the defense
and, if the Parent or the Company so elect at any time after receipt of such
notice, either of them may assume the defense of any suit brought to enforce any
such claim. The Trustee shall have the right to employ separate counsel in any
such suit and participate in the defense thereof but the fees and expenses of
such counsel shall be at the expense of the Trustee unless: (i) the employment
of such counsel has been authorized by the Parent or the Company, such
authorization not to be unreasonably withheld, or (ii) the named parties to any
such suit include both the Trustee and the Parent or the Company and the Trustee
shall have been advised by counsel acceptable to the Parent or the Company that
there may be one or more legal defenses available to the Trustee that are
different from or in addition to those available to the Parent or the Company
and that an actual or potential conflict of interest exists (in which case the
Parent and the Company shall not have the right to assume the defense of such
suit on behalf of the Trustee but shall be liable to pay the reasonable fees and
expenses of counsel for the Trustee).
9.2 LIMITATION OF LIABILITY
The Trustee shall not be held liable for any loss which may
occur by reason of depreciation of the value of any part of the Trust Estate or
any loss incurred on any investment of funds pursuant to this trust agreement,
except to the extent that such loss is attributable to the fraud, negligence,
wilful misconduct or bad faith on the part of the Trustee.
ARTICLE 10
CHANGE OF TRUSTEE
10.1 RESIGNATION
The Trustee, or any trustee hereafter appointed, may at any
time resign by giving written notice of such resignation to the Parent and the
Company specifying the date on which it desires to resign, provided that such
notice shall never be given less than 60 days before such desired resignation
date unless the Parent and the Company otherwise agree and provided further that
such resignation shall not take effect until the date of the appointment of a
successor trustee and the acceptance of such appointment by the successor
trustee. Upon receiving such notice of
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resignation, the Parent and the Company shall promptly appoint a successor
trustee by written instrument in duplicate, one copy of which shall be delivered
to the resigning trustee and one copy to the successor trustee. Failing
acceptance by a successor trustee, a successor trustee may be appointed by an
order of the Court of Queen's Bench of Alberta upon application of one or more
of the parties hereto.
10.2 REMOVAL
The Trustee, or any trustee hereafter appointed, may be
removed with or without cause, at any time on 60 days' prior notice by written
instrument executed by the Holders of the majority of the Exchangeable Shares,
in duplicate, one copy of which shall be delivered to the Trustee so removed and
one copy to the successor trustee.
10.3 SUCCESSOR TRUSTEE
Any successor trustee appointed as provided under this trust
agreement shall execute, acknowledge and deliver to the Parent and the Company
and to its predecessor trustee an instrument accepting such appointment.
Thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, duties and
obligations of its predecessor under this trust agreement, with like effect as
if originally named as trustee in this trust agreement. However, on the written
request of the Parent and the Company or of the successor trustee, the trustee
ceasing to act shall, upon payment of any amounts then due it pursuant to the
provisions of this trust agreement, execute and deliver an instrument
transferring to such successor trustee all the rights and powers of the trustee
so ceasing to act. Upon the request of any such successor trustee, the Parent,
the Company and such predecessor trustee shall execute any and all instruments
in writing for more fully and certainly vesting in and confirming to such
successor trustee all such rights and powers.
10.4 NOTICE OF SUCCESSOR TRUSTEE
Upon acceptance of appointment by a successor trustee as
provided herein, the Parent and the Company shall cause to be mailed notice of
the succession of such trustee hereunder to each Holder specified in a List. If
the Parent or the Company shall fail to cause
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such notice to be mailed within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the Parent and the Company.
ARTICLE 11
AMENDMENTS AND SUPPLEMENTAL TRUST AGREEMENTS
11.1 AMENDMENTS, MODIFICATIONS, ETC.
This trust agreement may not be amended or modified except by
an agreement in writing executed by the Company, the Parent and the Trustee and
approved by the Holders in accordance with Section 10.2 of the Exchangeable
Share Provisions.
11.2 MINISTERIAL AMENDMENTS
Notwithstanding the provisions of section 12.1 hereof, the
parties to this trust agreement may in writing, at any time and from time to
time, without the approval of the Holders, amend or modify this trust agreement
for the purposes of:
(a) adding to the covenants of any or all of the parties hereto
for the protection of the Holders hereunder;
(b) making such amendments or modifications not inconsistent with
this trust agreement as may be necessary or desirable with
respect to matters or questions which, in the opinion of the
Board of Directors of each of the Parent and Company and in
the opinion of the Trustee and its counsel, having in mind the
best interests of the Holders as a whole, it may be expedient
to make, provided that such boards of directors and the
Trustee and its counsel shall be of the opinion that such
amendments and modifications will not be prejudicial to the
interests of the Holders as a whole; or
(c) making such changes or corrections which, in the advice of
counsel to the Company, the Parent and the Trustee, are
required for the purpose of curing or correcting any ambiguity
or defect or inconsistent provision or clerical omission
-36-
or mistake or manifest error, provided that the Trustee and
its counsel and the Board of Directors of each of the Company
and the Parent shall be of the opinion that such changes or
corrections will not be prejudicial to the interests of the
Holders as a whole.
11.3 MEETING TO CONSIDER AMENDMENTS
The Company, at the request of the Parent, shall call a
meeting or meetings of the Holders for the purpose of considering any proposed
amendment or modification requiring approval pursuant hereto. Any such meeting
or meetings shall be called and held in accordance with the by-laws of the
Company, the Exchangeable Share Provisions and all applicable laws.
11.4 CHANGES IN CAPITAL OF PARENT AND THE COMPANY
(a) At all times after the occurrence of any event effected
pursuant to section 2.7 or section 2.8 of the Support
Agreement, as a result of which either the Parent Common Stock
or the Exchangeable Shares or both are in any way changed,
this trust agreement shall forthwith be amended and modified
as necessary in order that it shall apply with full force and
effect, to all new securities into which the Parent Common
Stock or the Exchangeable Shares or both are to changed and
the parties hereto shall execute and deliver a supplemental
trust agreement giving effect to and evidencing such necessary
amendments and modifications.
ARTICLE 12
TERMINATION
12.1 TERM
The Trust created by this trust agreement shall continue until
the earliest to occur of the following events:
(a) no outstanding Exchangeable Shares are held by any Holder;
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(b) each of the Company and the Parent elects in writing to
terminate the Trust and such termination is approved by the
Holders of the Exchangeable Shares in accordance with Section
10.2 of the Exchangeable Share Provisions, and
(c) 21 years after the death of the last survivor of the
descendants of Her Majesty Queen Elizabeth II of the United
Kingdom of Great Britain and Northern Ireland living on the
date of the creation of the Trust.
12.2 SURVIVAL OF AGREEMENT
This trust agreement shall survive any termination of the
Trust and shall continue until there are no Exchangeable Shares outstanding held
by a Holder; provided, however, that the provisions of Articles 8 and 9 hereof
shall survive any such termination of this trust agreement.
ARTICLE 13
GENERAL
13.1 SEVERABILITY
If any provision of this trust agreement is held to be
invalid, illegal or unenforceable, the validity, legality or enforceability of
the remainder of this trust agreement shall not in any way be affected or
impaired thereby and the agreement shall be carried out as nearly as possible in
accordance with its original terms and conditions.
13.2 INUREMENT
This trust agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns and to the benefit of the Holders.
13.3 NOTICES TO PARTIES
All notices and other communications between the parties
hereunder shall be in writing and shall be deemed to have been given if
delivered personally or by confirmed telecopy to the parties at the following
addresses (or at such other address for such party as shall be specified in like
notice):
-38-
(a) if to the Parent at: McAfee Associates, Inc.
2710 Walsh Avenue
Santa Clara, CA 95051-0963
Attention: William L. Larson
President and Chief Executive Officer
Fax Number:(408) 970-9727
with a copy to: Gunderson Dettmer Stough Villeneuve
Franklin & Hachigian, LLP
600 Hansen Way, Second Floor
Palo Alto, CA 94304
Attention: Carla S. Newell, Esq.
Fax Number: (415) 843-0314
(b) if to the Company at:FSA Corporation
1011 First Street S.W., Suite 508
Calgary, Alberta, CANADA
T2R 1J2
Attention: Daniel Freedman
Fax Number:(403) 264-0873
with a copy to:Macleod Dixon
3700, 400 Third Avenue S.W.
Calgary, Alberta, CANADA
T2P 4H2
Attention: John T. Ramsay, Esq
Fax Number: (403) 264-5973
if to the Trustee at:Macleod Dixon
3700, 400 Third Avenue S.W.
Calgary, Alberta, CANADA
T2P 4H2
Attention: John T. Ramsay, Esq
Fax Number: (403) 264-5973
Any notice or other communication given personally shall be
deemed to have been given and received upon delivery thereof and if given by
telecopy shall be deemed to have been given and received on the date of receipt
thereof unless such day is not a Business Day in which case it shall be deemed
to have been given and received upon the immediately following Business Day.
-39-
13.4 NOTICE OF HOLDERS
Any and all notices to be given and any documents to be sent
to any Holders may be given or sent to the address of such holder shown on the
register of holders of Exchangeable Shares in any manner permitted by the
by-laws of the Company from time to time in force and respect of notices to
shareholders and shall be deemed to be received (if given or sent in such
manner) at the time specified in such by-laws, the provisions of which by-laws
shall apply, with such changes as the context may require, to notices or
documents as aforesaid sent to such holders.
13.5 RISK OF PAYMENTS BY POST
Whenever payments are to be made or documents are to be sent
to any Holder by the Trustee or by the Company, or by such Holder to the Trustee
or to the Parent or the Company, the making of such payment or sending of such
document sent through the post shall be at the risk of the Company, in the case
of payments made or documents sent by the Trustee or the Company, and the
Holder, in the case of payments made or documents sent by the Holder.
13.6 COUNTERPARTS
This trust agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument.
13.7 JURISDICTION
This trust agreement shall be construed and enforced in
accordance with the laws of the Province of Alberta and the laws of Canada
applicable therein.
13.8 ATTORNMENT
The Parent agrees that any action or proceeding arising out of
or relating to this trust agreement may be instituted in the courts of Alberta,
waives any objection which it may have now or hereafter to the venue of any such
action or proceeding, irrevocably submits to the jurisdiction of the said courts
in any such action or proceeding, agrees to be bound by any judgement of the
said courts and agrees not to seek, and hereby waives, any review of the merits
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of any such judgement by the courts of any other jurisdiction and hereby
appoints the Company at its registered office in the Province of Alberta as the
Parent's attorney for service of processes.
IN WITNESS WHEREOF, the parties hereto have caused this trust
agreement to be duly executed as of the date first above written.
MCAFEE ASSOCIATES, INC.
By:____________________________
Its:___________________________
FSA COMBINATION CORP.
By:____________________________
Its:___________________________
FSA CORPORATION
By:____________________________
Its:___________________________
JOHN T. RAMSAY
_______________________________
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘8-K’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 9/24/96 |
| For Period End: | | 8/30/96 | | | | | | | S-8 |
| | 8/26/96 | | 2 |
| | 8/16/96 | | 1 |
| List all Filings |
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