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Exhibit 99.6
SCHEDULE D
EXCHANGE TRUST AGREEMENT
MEMORANDUM OF AGREEMENT made as of the - day of - , 2000.
AMONG:
VIVENDI,
a corporation existing under the laws of France (hereinafter
referred to as "VIVENDI", as such term is modified in section
1.1 of the Merger Agreement),
- and -
3744531 CANADA INC.,
a corporation existing under the laws of Canada (hereinafter
referred to as "VIVENDI EXCHANGECO"),
- and -
-,
a trust company incorporated under the laws of Canada
(hereinafter referred to as "TRUSTEE"),
WHEREAS in connection with a merger agreement (the "MERGER AGREEMENT")
made as of June 19, 2000 among Vivendi (by a predecessor corporation), The
Seagram Company Ltd., a corporation existing under the laws of Canada
("SEAGRAM"), and the other parties thereto, Vivendi Exchangeco is to issue
exchangeable shares (the "EXCHANGEABLE SHARES") to certain holders of securities
of Seagram under the plan of arrangement (the "ARRANGEMENT") contemplated in the
Merger Agreement;
AND WHEREAS under the Merger Agreement, Vivendi and Vivendi Exchangeco
are required to execute an exchange trust agreement substantially in the form of
this Agreement;
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NOW THEREFORE in consideration of the foregoing and the mutual
agreements contained herein and for other good and valuable consideration (the
receipt and sufficiency of which are hereby acknowledged), the parties hereto
covenant and agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement, the following terms shall have the following
meanings:
"AFFILIATE" has the meaning ascribed thereto in the Securities Act;
"ARRANGEMENT" means the arrangement under section 192 of the CBCA on
the terms and subject to the conditions set out in the Plan of
Arrangement;
"AUTOMATIC EXCHANGE RIGHT" means the benefit of the obligation of
Vivendi to effect the automatic exchange of Exchangeable Shares for
Vivendi ADSs under section 4.12;
"BENEFICIARIES" means the registered holders from time to time of
Exchangeable Shares, other than Vivendi and its Affiliates;
"BOARD OF DIRECTORS" means the board of directors of Vivendi
Exchangeco;
"BUSINESS DAY" means any day on which commercial banks are generally
open for business in Toronto, Ontario, New York City, New York and
Paris, France, other than a Saturday, a Sunday or a day observed as a
holiday in Toronto, Ontario, in New York City, New York or in Paris,
France under applicable laws;
"CBCA" means the Canada Business Corporations Act, as amended;
"CANADIAN DOLLAR EQUIVALENT" means, in respect of an amount expressed
in a currency other than Canadian dollars (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;
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"CURRENT MARKET PRICE" means, in respect of a Vivendi ADS on any date,
the Canadian Dollar Equivalent of the average of the closing prices (if
available) of Vivendi ADSs on the NYSE or NASDAQ during a period of 20
consecutive trading days ending on the third trading day before such
date, as provided by Reuters for the symbol "-", or, if the Vivendi
ADSs are not then listed on the NYSE or NASDAQ, the Canadian Dollar
Equivalent of the average of the closing prices (if available) of
Vivendi Shares on the principal exchange on which Vivendi Shares are
then listed; provided however, that if in the opinion of the Board of
Directors of Vivendi Exchangeco the public distribution or trading
activity of Vivendi ADSs or Vivendi Shares, as the case may be, during
such period does not create a market that reflects the fair market
value of a Vivendi ADS, then the Current Market Price of a Vivendi ADS
shall be determined by the Board of Directors of Vivendi Exchangeco, in
good faith and in its sole discretion, and provided further that any
such selection, opinion or determination by the Board of Directors
shall be conclusive and binding;
"CUSTODIAN" means the Person acting from time to time as custodian
under the Custody Agreement;
"CUSTODY AGREEMENT" means the custody agreement made between Vivendi,
Vivendi Exchangeco and the Custodian in connection with the Plan of
Arrangement substantially in the form and content of Schedule C annexed
to the Merger Agreement, as amended from time to time;
"EFFECTIVE TIME" has the meaning ascribed thereto in the Plan of
Arrangement;
"EXCHANGE RIGHT" has the meaning ascribed thereto in section 4.1;
"EXCHANGEABLE SHARES" means the non-voting exchangeable shares in the
capital of Vivendi Exchangeco, having the rights, privileges,
restrictions and conditions set out in Appendix 1 to the Plan of
Arrangement;
"INDEMNIFIED PARTIES" has the meaning ascribed thereto in section 7.1;
"INSOLVENCY EVENT" means the institution by Vivendi Exchangeco of any
proceeding to be adjudicated a bankrupt or insolvent or to be wound up,
or the consent of Vivendi Exchangeco to the institution of bankruptcy,
insolvency 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 Vivendi Exchangeco to
contest in good faith any such proceedings commenced in respect of
Vivendi Exchangeco within 30 days of becoming aware thereof, or the
consent by
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Xxxxxxx Xxxxxxxxxx to the filing of any such petition or to the
appointment of a receiver, or the making by Vivendi Exchangeco of a
general assignment for the benefit of creditors, or the admission in
writing by Vivendi Exchangeco of its inability to pay its debts
generally as they become due, or Vivendi Exchangeco not being
permitted, under solvency requirements of applicable law, to redeem any
Retracted Shares under section 6.6 of the Share Provisions;
"LIQUIDATION CALL RIGHT" has the meaning ascribed thereto in the Plan
of Arrangement;
"LIQUIDATION EVENT" has the meaning ascribed thereto in section
4.12(b);
"LIQUIDATION EVENT EFFECTIVE DATE" has the meaning ascribed thereto in
section 4.12(c);
"MERGER AGREEMENT" means the merger agreement made as of June 19, 2000
among Vivendi (by a predecessor corporation), Seagram and the other
parties thereto, as amended, supplemented and/or restated in accordance
therewith before the Effective Date, providing for, among other things,
the Arrangement;
"NASDAQ" means The NASDAQ Stock Market and any successor exchange or
market;
"NYSE" means the New York Stock Exchange, Inc. and any successor
exchange or market;
"OFFICER'S CERTIFICATE" means, with respect to Vivendi or Vivendi
Exchangeco, as the case may be, a certificate signed by any officer or
director of Vivendi or Vivendi Exchangeco, as the case may be;
"PERSON" includes any individual, firm, partnership, limited
partnership, joint venture, venture capital fund, limited liability
company, unlimited liability company, association, trust, trustee,
executor, administrator, legal personal representative, estate, group,
body corporate, corporation, unincorporated association or
organization, government body, syndicate or other entity, whether or
not having legal status;
"PLAN OF ARRANGEMENT" means the plan of arrangement relating to the
arrangement of Seagram under section 192 of the CBCA substantially in
the form and content of Schedule F annexed to the Merger Agreement and
any amendments or variations thereto made in accordance with section
6.1 of the Merger Agreement or Article 6 of the Plan of Arrangement or
made at the direction of the Court;
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"REDEMPTION CALL RIGHT" has the meaning ascribed thereto in the Plan of
Arrangement;
"RETRACTED SHARES" has the meaning ascribed thereto in section 4.7;
"RETRACTION CALL RIGHT" has the meaning ascribed thereto in the Share
Provisions;
"SECURITIES ACT" means the Securities Act (Ontario) and the rules,
regulations and policies made thereunder, as amended;
"SHARE PROVISIONS" means the rights, privileges, restrictions and
conditions attaching to the Exchangeable Shares set forth in Appendix 1
to the Plan of Arrangement;
"SUPPORT AGREEMENT" means the support agreement made as of even date
herewith among Vivendi Exchangeco, Vivendi Holdings and Vivendi in
connection with the Plan of Arrangement substantially in the form and
content of Schedule H to the Merger Agreement, as amended under the
terms of the Support Agreement;
"TRUST" means the trust created by this Agreement;
"TRUST ESTATE" means the Exchange Right, the Automatic Exchange Right
and any money, securities or other property that may be held by the
Trustee from time to time under this Agreement;
"TRUSTEE" means - and, subject to the provisions of Article 8, includes
any successor trustee;
"VIVENDI ADS ADJUSTMENT RATIO" has the meaning ascribed thereto in the
Share Provisions;
"VIVENDI ADS CONSIDERATION" has the meaning ascribed thereto in the
Share Provisions;
"VIVENDI ADSs" means the American depositary shares of Vivendi each
representing one Vivendi Share;
"VIVENDI HOLDINGS" means 3045479 Nova Scotia Company, an unlimited
liability company existing under the laws of the Province of Nova
Scotia and wholly owned, directly or indirectly, by Vivendi through any
number of entities, each of which is a disregarded entity for U.S.
federal income tax purposes;
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"VIVENDI SHARES" means the ordinary shares in the capital of Vivendi,
nominal value Euro -;
"VIVENDI SUCCESSOR" has the meaning ascribed thereto in section 9.1(a);
and
"VIVENDI VOTING RIGHT" means an "action en nue propriete" under French
law, which, among other things, represents one vote on the same basis
and in the same circumstances as one Vivendi Share.
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.
The division of this Agreement into Articles, sections and other
portions and the insertion of headings are for convenience of reference only and
shall not affect the construction or interpretation of this Agreement. Unless
otherwise indicated, all references to an "Article" or "section" followed by a
number and/or a letter refer to the specified Article or section of this
Agreement. The terms "this Agreement", "hereof", "herein" and "hereunder" and
similar expressions refer to this Agreement and not to any particular Article,
section or other portion hereof and include any agreement or instrument
supplementary or ancillary hereto.
1.3 NUMBER, GENDER, ETC.
Unless the context otherwise requires, words importing the singular
shall include the plural and vice versa. Words importing any gender include all
genders.
1.4 DATE FOR ANY ACTION
In the event that any date on which any action is required to be taken
under this Agreement by any person is not a Business Day, such action shall be
required to be taken on the next succeeding day that is a Business Day.
ARTICLE 2
PURPOSE OF AGREEMENT
2.1 ESTABLISHMENT OF TRUST
The purpose of this Agreement is to create the Trust for the benefit of
the Beneficiaries, as herein provided. The Trustee will hold the Exchange Right
and the Automatic Exchange Right in order to enable the Trustee to exercise such
rights, in each case as trustee for and on behalf of the Beneficiaries as
provided in this Agreement.
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ARTICLE 3
SHAREHOLDER INFORMATION
3.1 DISCLOSURE OF INTEREST IN EXCHANGEABLE SHARES
The Trustee and/or Vivendi Exchangeco shall be entitled to require any
Beneficiary or any person who the Trustee and/or Vivendi Exchangeco know or have
reasonable cause to believe to hold any interest whatsoever in an Exchangeable
Share to confirm that fact or to give to the Trustee and/or Vivendi Exchangeco
such details as to who has an interest in such Exchangeable Share as it would be
required to disclose, if the Exchangeable Shares were a class of "equity shares"
of Vivendi Exchangeco, under section 101 of the Securities Act or as it would be
required to disclose, under similar United States or French laws, if the
Exchangeable Shares were Vivendi ADSs or Vivendi Shares.
ARTICLE 4
EXCHANGE RIGHT AND AUTOMATIC EXCHANGE
4.1 GRANT AND OWNERSHIP OF EXCHANGE RIGHTS
Vivendi hereby grants to the Trustee as trustee for and on behalf of,
and for the use and benefit of, the Beneficiaries the right (the "EXCHANGE
RIGHT"), upon the occurrence and during the continuance of an Insolvency Event,
to require Vivendi to purchase from each or any Beneficiary all or any part of
the Exchangeable Shares held by the Beneficiary and the Automatic Exchange
Right, all in accordance with the provisions of this Agreement. Vivendi hereby
acknowledges receipt from the Trustee as trustee for and on behalf of the
Beneficiaries of good and valuable consideration (and the adequacy thereof) for
the grant of the Exchange Right and the Automatic Exchange Right by Vivendi to
the Trustee. During the term of the Trust and subject to the terms and
conditions of this Agreement, the Trustee shall possess and be vested with full
legal ownership of the Exchange Right and the Automatic Exchange Right 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 Right, provided that the Trustee
shall:
(a) hold the Exchange Right and the Automatic Exchange Right and
the legal title thereto as trustee solely for the use and
benefit of the Beneficiaries in accordance with the provisions
of this Agreement; and
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(b) except as specifically authorized by this Agreement, have no
power or authority to exercise or otherwise deal in or with
the Exchange Right or the Automatic Exchange Right, and the
Trustee shall not exercise any such rights for any purpose
other than the purposes for which the Trust is created under
this Agreement.
4.2 LEGENDED SHARE CERTIFICATES
Vivendi Exchangeco will cause each certificate representing
Exchangeable Shares to bear an appropriate legend notifying the Beneficiaries
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 Beneficiary; and
(b) the Automatic Exchange Right.
4.3 GENERAL EXERCISE OF EXCHANGE RIGHT
The Exchange Right shall be and remain vested in and exercisable by the
Trustee. Subject to section 5.15, the Trustee shall exercise the Exchange Right
only on the basis of instructions received under this Article 4 from
Beneficiaries entitled to instruct the Trustee as to the exercise thereof. To
the extent that no instructions are received from a Beneficiary with respect to
the Exchange Right, the Trustee shall not exercise or permit the exercise of the
Exchange Right.
4.4 PURCHASE PRICE
The purchase price payable by Vivendi for each Exchangeable Share to be
purchased by Vivendi under the Exchange Right shall be an amount per share equal
to the sum of (a) the Current Market Price of a Vivendi ADS on the last Business
Day before the day of closing of the purchase and sale of such Exchangeable
Share under the Exchange Right, which shall be satisfied in full by Vivendi
delivering or causing to be delivered to the Trustee on behalf of the relevant
Beneficiary the Vivendi ADS Consideration for each Exchangeable Share, plus (b)
to the extent not paid by Vivendi Exchangeco on the designated payment date
therefor, an additional amount equal to the full amount of all declared and
unpaid dividends on each such Exchangeable Share held by such holder on any
dividend record date that occurred before the closing of the purchase and sale.
In connection with each exercise of the Exchange Right, Vivendi shall provide to
the Trustee an Officer's Certificate setting forth the calculation of the
purchase price for each Exchangeable Share. The purchase price for each such
Exchangeable Share so purchased may be satisfied only by Vivendi delivering or
causing to be delivered to the Trustee, on behalf of the relevant
Beneficiary, the Vivendi ADS Consideration for the Exchangeable Share and on the
applicable payment date a cheque
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payable at par at any branch of the bankers of Vivendi for the balance, if any,
of the purchase price without interest (but less any amounts withheld under
section 4.13). Upon payment by Vivendi of such purchase price, the relevant
Beneficiary shall cease to have any right to be paid any amount in respect of
declared and unpaid dividends on each such Exchangeable Share by Vivendi
Exchangeco, and Vivendi Exchangeco shall cease to be obligated to pay any amount
in respect of such dividends.
4.5 EXERCISE INSTRUCTIONS
Subject to the terms and conditions herein set forth, a Beneficiary
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 Beneficiary on the books of Vivendi Exchangeco. To cause the exercise of
the Exchange Right by the Trustee, the Beneficiary shall deliver to the Trustee,
in person or by certified or registered mail, at its principal office in Toronto
or at such other places in Canada as the Trustee may from time to time designate
by written notice to the Beneficiaries, the certificates representing the
Exchangeable Shares that such Beneficiary desires Vivendi to purchase, duly
endorsed in blank for transfer, and accompanied by such other documents and
instruments as may be required to effect a transfer of Exchangeable Shares under
the governing statute and the by-laws of Vivendi Exchangeco and such additional
documents and instruments as the Trustee, Vivendi Exchangeco and Vivendi 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 Beneficiary thereby
instructs the Trustee to exercise the Exchange Right so as to require Vivendi to
purchase from the Beneficiary the number of Exchangeable Shares specified
therein, (ii) that such Beneficiary has good title to and owns all such
Exchangeable Shares to be acquired by Vivendi free and clear of all liens,
claims and encumbrances, (iii) the names in which the certificates representing
Vivendi ADSs transferable in connection with the exercise of the Exchange Right
are to be registered and (iv) the names and addresses of the persons to whom
such new certificates should be delivered (and (b) payment (or evidence
satisfactory to the Trustee, Vivendi Exchangeco and Vivendi Holdings of payment)
of the taxes (if any) payable as contemplated by section 4.8.). If only a part
of the Exchangeable Shares represented by any certificate or certificates
delivered to the Trustee are to be purchased by Vivendi under the Exchange
Right, a new certificate for the balance of such Exchangeable Shares shall be
issued to the holder at the expense of Vivendi Exchangeco.
4.6 DELIVERY OF VIVENDI ADSS; EFFECT OF EXERCISE
Promptly after the receipt of the certificates representing the
Exchangeable Shares that the Beneficiary desires Vivendi 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 payable as contemplated by section 4.8
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or evidence thereof), duly endorsed for transfer to Vivendi, the Trustee shall
notify Vivendi and Vivendi Exchangeco of its receipt of the same, which notice
to Vivendi and Vivendi Exchangeco shall constitute exercise of the Exchange
Right by the Trustee on behalf of the holder of such Exchangeable Shares, and
Vivendi shall promptly thereafter deliver or cause to be delivered to the
Trustee, for delivery to the Beneficiary of such Exchangeable Shares (or to such
other persons, if any, properly designated by such Beneficiary) the number of
Vivendi ADSs issuable in connection with the exercise of the Exchange Right, and
on the applicable payment date cheques payable at par at any branch of the
bankers of Vivendi for the balance, if any, of the total purchase price therefor
without interest (but less any amounts withheld under section 4.13); provided,
however, that no such delivery shall be made unless and until the Beneficiary
requesting the same shall have paid (or provided evidence satisfactory to the
Trustee, Vivendi Exchangeco and Vivendi Holdings of the payment of) the taxes
(if any) payable as contemplated by section 4.8 of this Agreement. Immediately
upon the giving of notice by the Trustee to Vivendi and Vivendi Exchangeco of
the exercise of the Exchange Right as provided in this section 4.6, the closing
of the transaction of purchase and sale contemplated by the Exchange Right shall
be deemed to have occurred and the holder of such Exchangeable Shares shall be
deemed to have transferred to Vivendi all of such 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
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
purchase price therefor, unless the requisite number of Vivendi ADSs is not
delivered by, or on behalf of, Vivendi to the Trustee within five Business Days
of the date of the giving of such notice by the Trustee or the balance of the
purchase price, if any, is not paid by Vivendi on the applicable payment date
therefor, in which case the rights of the Beneficiary shall remain unaffected
until such Vivendi ADSs are so delivered, and the balance of the purchase price,
if any, (and all dividends and other distributions with respect to the Vivendi
ADSs to which such Beneficiary is entitled with a record date on or after the
date of exercise of the Exchange Right and before the time at which such
Beneficiary becomes the holder of such Vivendi ADSs, provided that a
corresponding amount has not been received by such Beneficiary on its
Exchangeable Shares), has been paid, by Vivendi. Upon delivery by Vivendi to the
Trustee of such Vivendi ADSs, and the balance of the purchase price, if any, the
Trustee shall deliver such Vivendi ADSs to such Beneficiary (or to such other
persons, if any, properly designated by such Beneficiary). Concurrently with
such Beneficiary ceasing to be a holder of Exchangeable Shares, the Beneficiary
shall be considered and deemed for all purposes to be the holder of the Vivendi
ADSs delivered to it under the Exchange Right.
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4.7 EXERCISE OF EXCHANGE RIGHT SUBSEQUENT TO RETRACTION
In the event that a Beneficiary has exercised its right under Article 6
of the Share Provisions to require Vivendi Exchangeco to redeem any or all of
the Exchangeable Shares held by the Beneficiary (the "RETRACTED SHARES") and is
notified by Vivendi Exchangeco under section 6.6 of the Share Provisions that
Vivendi Exchangeco will not be permitted as a result of solvency requirements of
applicable law to redeem all such Retracted Shares, and provided that Vivendi
shall not have exercised the Retraction Call Right with respect to the Retracted
Shares and that the Beneficiary has not revoked the retraction request delivered
by the Beneficiary to Vivendi Exchangeco under section 6.1 of the Share
Provisions and provided further that the Trustee has received written notice of
same from Vivendi Exchangeco or Vivendi, the retraction request will constitute
and will be deemed to constitute notice from the Beneficiary to the Trustee
instructing the Trustee to exercise the Exchange Right with respect to those
Retracted Shares that Vivendi Exchangeco is unable to redeem. In any such event,
Vivendi Exchangeco hereby agrees with the Trustee and in favour of the
Beneficiary promptly to forward or cause to be forwarded to the Trustee all
relevant materials delivered by the Beneficiary to Vivendi Exchangeco or to the
transfer agent of the Exchangeable Shares (including without limitation, a copy
of the retraction request delivered under section 6.1 of the 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 Vivendi Exchangeco is not permitted to redeem and will require
Vivendi to purchase such shares in accordance with the provisions of this
Article 4.
4.8 STAMP OR OTHER TRANSFER TAXES
Upon any sale of Exchangeable Shares to Vivendi Holdings under the
Exchange Right or the Automatic Exchange Right, the Vivendi ADSs to be delivered
in connection with the payment of the total purchase price therefor shall be
issued in the name of the Beneficiary of the Exchangeable Shares so sold or in
such names as such Beneficiary may otherwise direct in writing without charge to
the holder of the Exchangeable Shares so sold; provided, however, that such
Beneficiary (a) shall pay (and none of Vivendi, Vivendi Holdings, Vivendi
Exchangeco or the Trustee shall be required to pay) any documentary, stamp,
transfer or other taxes that may be payable in respect of any transfer involved
in the delivery of the Vivendi ADSs to a person other than such Beneficiary or
(b) shall have evidenced to the satisfaction of the Trustee, Vivendi Holdings
and Vivendi Exchangeco that such taxes, if any, have been paid.
4.9 NOTICE OF INSOLVENCY EVENT
As soon as practicable following the occurrence of an Insolvency Event
or any event that with the giving of notice or the passage of time or both would
be an Insolvency Event,
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Xxxxxxx Xxxxxxxxxx and Vivendi shall give written notice thereof to the Trustee.
As soon as practicable following the receipt of notice from Vivendi Exchangeco
and Vivendi of the occurrence of an Insolvency Event, or upon the Trustee
becoming aware of an Insolvency Event, the Trustee will mail to each
Beneficiary, at the expense of Vivendi (such funds to be received in advance), a
notice of such Insolvency Event in the form provided by Vivendi, which notice
shall contain a brief statement of the rights of the Beneficiaries with respect
to the Exchange Right.
4.10 VIVENDI COVENANTS AND QUALIFICATION OF VIVENDI ADSs
(a) Vivendi covenants, in favour of the Trustee as trustee for and
on behalf of, and for the use and benefit of, the
Beneficiaries to fulfill all of its obligations under this
Agreement in respect of the Exchange Rights and the Automatic
Exchange Right including, without limitation, the obligation
to pay the purchase price payable for each Exchangeable Share
to be purchased under the Exchange Right or the Automatic
Exchange Right.
(b) Vivendi covenants that if any Vivendi ADSs to be delivered
under the Exchange Right or the Automatic Exchange Right
require registration or qualification with or approval of or
the filing of any document, including any prospectus or
similar document, or the taking of any proceeding with or the
obtaining of any order, ruling or consent from any
governmental or regulatory authority under any Canadian,
French or United States federal, provincial, territorial or
state law or regulation or under the rules and regulations of
any regulatory authority or the fulfillment of any other
Canadian, French or United States federal, provincial,
territorial or state legal requirement before such Vivendi
ADSs may be issued and delivered by Vivendi to the initial
holder thereof or in order that such shares may be freely
traded thereafter (other than any restrictions of general
application on transfer by reason of a holder being a "control
person" of Vivendi for purposes of Canadian provincial or
territorial securities law or an "affiliate" of Vivendi for
purposes of United States federal or state securities law or
the equivalent thereof under applicable French laws or stock
exchange or regulatory requirements), Vivendi will in good
faith expeditiously take all such actions and do all such
things as are necessary or desirable to cause such Vivendi
ADSs to be and remain duly registered, qualified or approved.
Vivendi will in good faith expeditiously take all such actions
and do all such things as are reasonably necessary or
desirable to cause all Vivendi ADSs to be delivered under the
Exchange Right or the Automatic Exchange Right to be listed,
quoted or posted for trading on all stock exchanges and
quotation systems on which outstanding Vivendi ADSs have been
listed by Vivendi and remain listed and are quoted or posted
for trading at such time.
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4.11 VIVENDI ADSs
Vivendi hereby represents, warrants and covenants that the Vivendi ADSs
provided as described herein (and the underlying Vivendi Shares) will be duly
authorized and validly issued as fully paid and non-assessable and shall be free
and clear of any lien, claim or encumbrance.
4.12 AUTOMATIC EXCHANGE ON LIQUIDATION OF VIVENDI
(a) Vivendi 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 Vivendi to institute voluntary
liquidation, dissolution or winding-up proceedings
with respect to Vivendi or to effect any other
distribution of assets of Vivendi among its
shareholders for the purpose of winding up its
affairs, at least 60 days before the proposed
effective date of such liquidation, dissolution,
winding-up or other distribution; and
(ii) as soon as practicable following the earlier of (A)
receipt by Vivendi of notice of, and (B) Vivendi
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 Vivendi or to effect any
other distribution of assets of Vivendi among its
shareholders for the purpose of winding up its
affairs, in each case where Vivendi has failed to
contest in good faith any such proceeding commenced
in respect of Vivendi within 30 days of becoming
aware thereof.
(b) As soon as practicable following receipt by the Trustee from
Vivendi of notice of any event (a "LIQUIDATION EVENT")
contemplated by section 4.12(a)(i) or 4.12(a)(ii), the Trustee
will give notice thereof to the Beneficiaries. Such notice
shall be provided to the Trustee by Vivendi and shall include
a brief description of the automatic exchange of Exchangeable
Shares for Vivendi ADSs provided for in section 4.12(c).
(c) In order that the Beneficiaries will be able to participate on
a pro rata basis with the holders of Vivendi ADSs in the
distribution of assets of Vivendi in connection with a
Liquidation Event, on the fifth Business Day before the
effective date (the "LIQUIDATION EVENT EFFECTIVE DATE") of a
Liquidation Event all of the then outstanding Exchangeable
Shares shall be automatically
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exchanged for Vivendi ADSs plus cash equal to any declared and
unpaid dividends in respect of such Exchangeable Shares. To
effect such automatic exchange, Vivendi shall purchase on the
fifth Business Day before the Liquidation Event Effective Date
each Exchangeable Share then outstanding and held by
Beneficiaries, and each Beneficiary shall sell the
Exchangeable Shares held by it at such time, for a purchase
price per share equal to the sum of (a) the Current Market
Price of a Vivendi ADS on the fifth Business Day before the
Liquidation Event Effective Date, which shall be satisfied in
full by Vivendi issuing to the Beneficiary the Vivendi ADS
Consideration for the Exchangeable Share, and (b) to the
extent not paid by Vivendi Exchangeco, an additional amount
equal to the full amount of all declared and unpaid dividends
on each such Exchangeable Share held by such holder on any
dividend record date which occurred before the date of the
exchange. Vivendi shall provide the Trustee with an Officer's
Certificate in connection with each automatic exchange setting
forth the calculation of the purchase price for each
Exchangeable Share.
(d) On the fifth Business Day before the Liquidation Event
Effective Date, the closing of the transaction of purchase and
sale contemplated by the automatic exchange of Exchangeable
Shares for Vivendi ADS plus cash equal to any declared and
unpaid dividends in respect of such Exchangeable Shares shall
be deemed to have occurred, and each Beneficiary shall be
deemed to have transferred to Vivendi all of the Beneficiary's
right, title and interest in and to such Beneficiary's
Exchangeable Shares and the related interest in the Trust
Estate, Vivendi Exchangeco shall have no liability to pay any
amount in respect of declared and unpaid dividends on such
Exchangeable Shares and each such Beneficiary shall cease to
be a holder of such Exchangeable Shares and Vivendi shall
transfer to the Beneficiary the Vivendi ADSs transferable upon
the automatic exchange of Exchangeable Shares for Vivendi ADSs
and on the applicable payment date shall deliver to the
Trustee for delivery to the Beneficiary a cheque payable at
par at any branch of the bankers of Vivendi for the balance,
if any, of the total purchase price for such Exchangeable
Shares (and all dividends and other distributions with respect
to the Vivendi ADSs to which each such Beneficiary is entitled
with a record date on or after the fifth Business Day before
the Liquidation Event Effective Date and before the time at
which each such Beneficiary becomes the holder of such Vivendi
ADSs, provided that a corresponding amount has not been
received by each such Beneficiary on their Exchangeable
Shares) without interest but less any amounts withheld under
section 4.13. Concurrently with such Beneficiary ceasing to be
a holder of Exchangeable Shares, the Beneficiary shall be
considered and deemed for all purposes to be the holder of the
Vivendi ADSs issued under the automatic exchange of
Exchangeable Shares for Vivendi ADSs and the certificates held
by the Beneficiary previously representing the
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Exchangeable Shares exchanged by the Beneficiary with Vivendi
under such automatic exchange shall thereafter be deemed to
represent Vivendi ADSs delivered to the Beneficiary by Vivendi
under such automatic exchange. Upon the request of a
Beneficiary and the surrender by the Beneficiary of
Exchangeable Share certificates deemed to represent Vivendi
ADSs, duly endorsed in blank and accompanied by such
instruments of transfer as Vivendi may reasonably require,
Vivendi shall deliver or cause to be delivered to the
Beneficiary the Vivendi ADSs of which the Beneficiary is the
holder.
4.13 WITHHOLDING RIGHTS
Vivendi, Vivendi Exchangeco and the Trustee shall be entitled to deduct
and withhold from any consideration otherwise payable under this Agreement to
any holder of Exchangeable Shares or Vivendi ADSs such amounts as Vivendi,
Vivendi Exchangeco or the Trustee determines, acting reasonably, are required or
permitted pursuant to section 116 of the Income Tax Act (Canada) or any
successor provision thereto to be deducted and withheld with respect to such
payment under the Income Tax Act (Canada), the United States Internal Revenue
Code of 1986, the tax laws of France or any provision of federal, provincial,
territorial, state, local or foreign tax law, in each case as amended or
succeeded. The Trustee may act on the advice of counsel with respect to such
matters. To the extent that amounts are so withheld, such withheld amounts shall
be treated for all purposes as having been paid to the holder of the shares in
respect of which such deduction and withholding was made, provided that such
withheld amounts are actually remitted to the appropriate taxing authority. To
the extent that the amount so required or permitted to be deducted or withheld
from any payment to a holder exceeds the cash portion of the consideration
otherwise payable to the holder, Vivendi, Vivendi Exchangeco and the Trustee are
hereby authorized to sell or otherwise dispose of such portion of the
consideration as is necessary to provide sufficient funds to Vivendi, Vivendi
Exchangeco or the Trustee, as the case may be, to enable it to comply with such
deduction or withholding requirement and Vivendi, Vivendi Exchangeco or the
Trustee shall notify the holder thereof and remit to such holder any unapplied
balance of the net proceeds of such sale.
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ARTICLE 5
CONCERNING THE TRUSTEE
5.1 POWERS AND DUTIES OF THE TRUSTEE
The rights, powers, duties and authorities of the Trustee under this
Agreement, in its capacity as Trustee of the Trust, shall include:
(a) receiving the grant of the Exchange Right and the Automatic
Exchange Right from Vivendi as Trustee for and on behalf of
the Beneficiaries in accordance with the provisions of this
Agreement;
(b) exercising the Exchange Right and enforcing the benefit of the
Automatic Exchange Right, in each case in accordance with the
provisions of this Agreement, and in connection therewith
receiving from Beneficiaries Exchangeable Shares and other
requisite documents and distributing to such Beneficiaries
Vivendi ADSs and cheques, if any, to which such Beneficiaries
are entitled upon the exercise of the Exchange Right or under
the Automatic Exchange Right, as the case may be;
(c) holding title to the Trust Estate;
(d) investing any moneys forming, from time to time, a part of the
Trust Estate as provided in this Agreement;
(e) taking action on its own initiative or at the direction of a
Beneficiary or Beneficiaries to enforce the obligations of
Vivendi, and Vivendi Exchangeco under this Agreement; and
(f) taking such other actions and doing such other things as are
specifically provided in this Agreement.
In the exercise of such rights, powers, duties and authorities the
Trustee shall have (and is granted) such incidental and additional rights,
powers, duties and authority not in conflict with any of the provisions of this
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, duties
and authorities by the Trustee shall be final, conclusive and binding upon all
persons.
The Trustee in exercising its rights, powers, duties and authorities
hereunder shall act honestly and in good faith and with a view to the best
interests of the Beneficiaries and shall
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exercise the care, diligence and skill that a reasonably prudent trustee would
exercise in comparable circumstances.
The Trustee shall not be bound to give 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.
5.2 NO CONFLICT OF INTEREST
The Trustee represents to Vivendi, and Vivendi Exchangeco that at the
date of execution and delivery of this 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 material conflict of interest exists, either
eliminate such material conflict of interest or resign in the manner and with
the effect specified in Article 8. If, notwithstanding the foregoing provisions
of this section 5.2, the Trustee has such a material conflict of interest, the
validity and enforceability of this 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
5.2, any interested party may apply to the Superior Court of Justice (Ontario)
for an order that the Trustee be replaced as Trustee hereunder.
5.3 DEALINGS WITH TRANSFER AGENTS, REGISTRARS, ETC.
Vivendi, and Vivendi Exchangeco 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
Vivendi ADSs; 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 Agreement and (ii) from the transfer agent of
Vivendi ADSs, and any subsequent transfer agent of Vivendi
ADSs, the
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00
Xxxxxxx XXXx transferred by Vivendi upon the exercise from
time to time of the Exchange Right and under the Automatic
Exchange Right.
Vivendi and Vivendi Exchangeco irrevocably authorize their respective
registrars and transfer agents to comply with all such requests. Vivendi
covenants that it will supply the transfer agent of the Vivendi ADSs with
Vivendi ADSs duly endorsed for transfer for the purpose of completing the
exercise from time to time of the Exchange Right and the Automatic Exchange
Right.
5.4 BOOKS AND RECORDS
The Trustee shall keep available for inspection by Vivendi, and Vivendi
Exchangeco at the Trustee's principal office in Toronto correct and complete
books and records of account relating to the Trust created by this Agreement,
including without limitation, all relevant data relating to mailings and
instructions to and from Beneficiaries and all transactions under the Exchange
Right and the Automatic Exchange Right. On or before January 15, 2001, and on or
before January 15th in every year thereafter, the Trustee shall transmit to
Vivendi, and Vivendi Exchangeco a brief report, dated as of the preceding
December 31st, with respect to:
(a) the property and funds comprising the Trust Estate as of that
date;
(b) the number of exercises of the Exchange Right, if any, and the
aggregate number of Exchangeable Shares received by the
Trustee on behalf of Beneficiaries in consideration of the
transfer by Vivendi of Vivendi ADSs in connection with the
Exchange Right, during the calendar year ended on such
December 3lst, and
(c) any action taken by the Trustee in the performance of its
duties under this Agreement which it had not previously
reported and which, in the Trustee's opinion, materially
affects the Trust Estate.
5.5 INCOME TAX RETURNS AND REPORTS
The Trustee shall, to the extent necessary, prepare and file on behalf
of the Trust appropriate French, United States and Canadian income tax returns
and any other returns or reports as may be required by applicable law or under
the rules and regulations of any securities exchange or other trading system
through which the Exchangeable Shares are traded. In connection therewith, the
Trustee may obtain the advice and assistance of such experts or advisors as the
Trustee considers necessary or advisable (who may be experts or advisors to
Vivendi, or Vivendi Exchangeco). If requested by the Trustee, Vivendi, or
Vivendi Exchangeco shall retain qualified experts or advisors for the purpose of
providing such tax advice or assistance.
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5.6 INDEMNIFICATION BEFORE CERTAIN ACTIONS BY TRUSTEE
The Trustee shall exercise any or all of the rights, duties, powers or
authorities vested in it by this Agreement at the request, order or direction of
any Beneficiary upon such Beneficiary furnishing to the Trustee reasonable
funding, security or indemnity against the costs, expenses and liabilities that
may be incurred by the Trustee therein or thereby, provided that no Beneficiary
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 Exchange Right under Article
4, subject to section 5.15, and with respect to the Automatic Exchange Right
under Article 4.
None of the provisions contained in this 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 security and indemnified as aforesaid.
5.7 ACTION OF BENEFICIARIES
No Beneficiary shall have the right to institute any action, suit or
proceeding or to exercise any other remedy authorized by this Agreement for the
purpose of enforcing any of its rights or for the execution of any trust or
power hereunder unless the Beneficiary has requested the Trustee to take or
institute such action, suit or proceeding and furnished the Trustee with the
funding, security or indemnity referred to in section 5.6 and the Trustee shall
have failed to act within a reasonable time thereafter. In such case, but not
otherwise, the Beneficiary 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 Beneficiaries 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 the Exchange Rights or the
Automatic Exchange Right 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
Beneficiaries.
5.8 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 statutory declarations, certificates, opinions or
reports furnished under the provisions hereof or required by the Trustee to be
furnished to it in the exercise of its rights, powers, duties and authorities
hereunder if such statutory declarations, certificates, opinions or reports
comply with the provisions of section 5.9, if applicable, and with any other
applicable provisions of this Agreement.
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5.9 EVIDENCE AND AUTHORITY TO TRUSTEE
Vivendi and/or Vivendi Exchangeco shall furnish to the Trustee evidence
of compliance with the conditions provided for in this Agreement relating to any
action or step required or permitted to be taken by Vivendi, and/or Vivendi
Exchangeco or the Trustee under this Agreement or as a result of any obligation
imposed under this Agreement, including, without limitation, in respect of the
Exchange Right or the Automatic Exchange Right and the taking of any other
action to be taken by the Trustee at the request of or on the application of
Vivendi, and/or Vivendi Exchangeco promptly if and when:
(a) such evidence is required by any other section of this
Agreement to be furnished to the Trustee in accordance with
the terms of this section 5.9; or
(b) the Trustee, in the exercise of its rights, powers, duties and
authorities under this Agreement, gives Vivendi, and/or
Vivendi Exchangeco 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 Vivendi,
and/or Vivendi Exchangeco 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 Agreement.
Whenever such evidence relates to a matter other than the Exchange
Right or the Automatic Exchange Right or the taking of any other action to be
taken by the Trustee at the request or on the application of Vivendi, and/or
Vivendi Exchangeco, and except as otherwise specifically provided herein, such
evidence may consist of a report or opinion of any solicitor, attorney, 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
Vivendi, and/or Vivendi Exchangeco it shall be in the form of an Officer's
Certificate or a statutory declaration.
Each statutory declaration, Officer's Certificate, opinion or report
furnished to the Trustee as evidence of compliance with a condition provided for
in this Agreement shall include a statement by the person giving the evidence:
(c) declaring that he has read and understands the provisions of
this Agreement relating to the condition in question;
(d) describing the nature and scope of the examination or
investigation upon which he based the statutory declaration,
certificate, statement or opinion; and
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(e) 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.
5.10 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 any solicitor,
attorney, auditor, accountant, appraiser, valuer, engineer or
other expert, whether retained by the Trustee or by Vivendi,
and/or Vivendi Exchangeco or otherwise, and may retain or
employ such assistants as may be necessary to the proper
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 discharge of its duties hereunder and in
the management of the Trust.
5.11 INVESTMENT OF MONEYS HELD BY TRUSTEE
Unless otherwise provided in this Agreement, any moneys held by or on
behalf of the Trustee which under the terms of this 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 trust for Vivendi Exchangeco, in securities in which,
under the laws of the Province of Ontario, 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 Vivendi Exchangeco. Pending the investment of
any 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 Vivendi
Exchangeco, in the deposit department of the Trustee or any other loan or trust
company authorized to accept deposits under the laws of Canada or any province
thereof at the rate of interest then current on similar deposits.
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5.12 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 Agreement or otherwise in respect of the premises.
5.13 TRUSTEE NOT BOUND TO ACT ON REQUEST
Except as in this Agreement otherwise specifically provided, the
Trustee shall not be bound to act in accordance with any direction or request of
Vivendi, and/or Vivendi Exchangeco 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 upon any such copy purporting to be authenticated and believed
by the Trustee to be genuine.
5.14 AUTHORITY TO CARRY ON BUSINESS
The Trustee represents to Vivendi, and Vivendi Exchangeco that at the
date of execution and delivery by it of this Agreement it is authorized to carry
on the business of a trust company in each of the Provinces of Canada but if,
notwithstanding the provisions of this section 5.14, it ceases to be so
authorized to carry on business, the validity and enforceability of this
Agreement and the Exchange Right and the Automatic Exchange Right 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 any Province of Canada, either become so authorized or resign
in the manner and with the effect specified in Article 8.
5.15 CONFLICTING CLAIMS
If conflicting claims or demands are made or asserted with respect to
any interest of any Beneficiary 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 Beneficiary in 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 claims or demands.
In so refusing, the Trustee may elect not to deliver the Vivendi ADSs for which
such Exchangeable Shares are exchangeable 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
Exchange Right or Automatic Exchange Right subject to such
conflicting claims or demands
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have been adjudicated by a final judgment of a court of
competent jurisdiction and all rights of appeal therefrom have
expired; or
(b) all differences with respect to the Exchange Right or
Automatic Exchange Right 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 certified to be in full force and effect.
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 to fully indemnify it as between all
conflicting claims or demands.
5.16 ACCEPTANCE OF TRUST
The Trustee hereby accepts the Trust created and provided for by and in
this Agreement and agrees to perform the same upon the terms and conditions
herein set forth 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 Beneficiaries, subject to all the terms and conditions herein set forth.
ARTICLE 6
COMPENSATION
6.1 FEES AND EXPENSES OF THE TRUSTEE
Vivendi, and Vivendi Exchangeco jointly and severally agree to pay the
Trustee reasonable compensation for all of the services rendered by it under
this Agreement and will reimburse the Trustee for all reasonable expenses
(including, but not limited to, fees paid to legal counsel and other experts 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 reasonably incurred by the Trustee in connection with its
duties under this Agreement; provided that Vivendi, and Vivendi Exchangeco 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,
recklessness or wilful misconduct.
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ARTICLE 7
INDEMNIFICATION AND LIMITATION OF LIABILITY
7.1 INDEMNIFICATION OF THE TRUSTEE
Vivendi and Vivendi Exchangeco 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 Agreement (collectively, the
"INDEMNIFIED PARTIES") against all claims, losses, damages, reasonable 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 or as a result of the Trustee's
acceptance or administration of the Trust, its compliance with its duties set
forth in this Agreement, or any written or oral instruction delivered to the
Trustee by Vivendi or Vivendi Exchangeco under this Agreement.
In no case shall Vivendi or Vivendi Exchangeco be liable under this
indemnity for any claim against any of the Indemnified Parties unless Vivendi
and Vivendi Exchangeco 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 to the nature and basis of the claim.
Subject to (ii) below, Vivendi and Vivendi Exchangeco shall be entitled to
participate at their own expense in the defense and, if Vivendi and Vivendi
Exchangeco so elect at any time after receipt of such notice, any 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 Vivendi or Vivendi Exchangeco; or (ii) the named parties to any
such suit include both the Trustee and Vivendi or Vivendi Exchangeco and the
Trustee shall have been advised by counsel acceptable to Vivendi or Vivendi
Exchangeco that there may be one or more legal defenses available to the Trustee
that are different from or in addition to those available to Vivendi, or Vivendi
Exchangeco and that, in the judgment of such counsel, would present a conflict
of interest were a joint representation to be undertaken (in which case Vivendi
and Vivendi Exchangeco 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). This indemnity shall survive the
termination of this Agreement and the resignation or removal of the Trustee.
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7.2 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 under this Agreement, except to the extent
that such loss is attributable to the fraud, negligence, recklessness, wilful
misconduct or bad faith on the part of the Trustee.
ARTICLE 8
CHANGE OF TRUSTEE
8.1 RESIGNATION
The Trustee, or any trustee hereafter appointed, may at any time resign
by giving written notice of such resignation to Vivendi and Vivendi Exchangeco
specifying the date on which it desires to resign, provided that such notice
shall not be given less than thirty (30) days before such desired resignation
date unless Vivendi and Vivendi Exchangeco 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 resignation, Vivendi and Vivendi
Exchangeco shall promptly appoint a successor trustee, which shall be a
corporation organized and existing under the laws of Canada and authorized to
carry on the business of a trust company in all provinces of Canada, by written
instrument in duplicate, one copy of which shall be delivered to the resigning
trustee and one copy to the successor trustee. Failing the appointment and
acceptance of a successor trustee, a successor trustee may be appointed by order
of a court of competent jurisdiction upon application of one or more of the
parties to this Agreement. If the retiring trustee is the party initiating an
application for the appointment of a successor trustee by order of a court of
competent jurisdiction, Vivendi and Vivendi Exchangeco shall be jointly and
severally liable to reimburse the retiring trustee for its legal costs and
expenses in connection with same.
8.2 REMOVAL
The Trustee, or any trustee hereafter appointed, may (provided a
successor trustee is appointed) be removed at any time on not less than 30 days'
prior notice by written instrument executed by Vivendi and Vivendi Exchangeco,
in duplicate, one copy of which shall be delivered to the trustee so removed and
one copy to the successor trustee.
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8.3 SUCCESSOR TRUSTEE
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Any successor trustee appointed as provided under this Agreement shall
execute, acknowledge and deliver to Vivendi and Vivendi Exchangeco 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 Agreement, with the like effect as if originally named as
trustee in this Agreement. However, on the written request of Vivendi and
Vivendi Exchangeco or of the successor trustee, the trustee ceasing to act
shall, upon payment of any amounts then due it under the provisions of this
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, Vivendi, Vivendi Exchangeco 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.
8.4 NOTICE OF SUCCESSOR TRUSTEE
Upon acceptance of appointment by a successor trustee as provided
herein, Vivendi and Vivendi Exchangeco shall cause to be mailed notice of the
succession of such trustee hereunder to each Beneficiary. If Vivendi or Vivendi
Exchangeco shall fail to cause 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 Vivendi and Vivendi Exchangeco.
ARTICLE 9
VIVENDI SUCCESSORS
9.1 CERTAIN REQUIREMENTS IN RESPECT OF COMBINATION, ETC.
Vivendi shall not consummate any transaction (whether by way of
reconstruction, reorganization, consolidation, merger, transfer, sale, lease or
otherwise) whereby all or substantially all of its undertaking, property and
assets or the Vivendi Shares would become the property of any other person or,
in the case of a merger, of the continuing corporation resulting therefrom
unless, but may do so if:
(a) such other person or continuing corporation (herein called the
"VIVENDI SUCCESSOR"), by operation of law, becomes, without
more, bound by the terms and provisions of this Agreement or,
if not so bound, executes, before or contemporaneously with
the consummation of such transaction, a trust agreement
supplemental hereto and such other instruments (if any) as are
satisfactory to the Trustee, acting reasonably, and in the
opinion of legal
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counsel to the Trustee are reasonably necessary or advisable
to evidence the assumption by the Vivendi Successor of
liability for any moneys payable and property deliverable
hereunder by Vivendi and the covenant of such Vivendi
Successor to pay and deliver or cause to be delivered the same
and its agreement to observe and perform all the covenants and
obligations of Vivendi under this Agreement; and
(b) such transaction shall, to the satisfaction of the Trustee,
acting reasonably, and in the opinion of legal counsel to the
Trustee, be upon such terms and conditions as substantially to
preserve and not to impair in any material respect any of the
rights, duties, powers and authorities of the Trustee or of
the Beneficiaries hereunder.
9.2 VESTING OF POWERS IN SUCCESSOR
Whenever the conditions of section 9.1 have been duly observed and
performed, the Trustee, Vivendi Successor, Vivendi Exchangeco and Vivendi as
applicable, shall, if required by section 9.1, execute and deliver the
supplemental trust agreement provided for in Article 10 and thereupon Vivendi
Successor shall possess and from time to time may exercise each and every right
and power of Vivendi under this Agreement in the name of Vivendi or otherwise
and any act or proceeding by any provision of this Agreement required to be done
or performed by the Board of Directors of Vivendi or any officers of Vivendi may
be done and performed with like force and effect by the directors or officers of
such Vivendi Successor.
9.3 WHOLLY-OWNED SUBSIDIARIES
Nothing herein shall be construed as preventing (i) the amalgamation or
merger of any wholly-owned direct or indirect subsidiary of Vivendi (other than
Vivendi Exchangeco or Vivendi Holdings) with or into Vivendi, (ii) the
winding-up, liquidation or dissolution of any wholly-owned direct or indirect
subsidiary of Vivendi (other than Vivendi Exchangeco or Vivendi Holdings)
provided that all of the assets of such subsidiary are transferred to Vivendi or
another wholly-owned direct or indirect subsidiary of Vivendi, or (iii) any
other distribution of the assets of any wholly-owned direct or indirect
subsidiary of Vivendi (other than Vivendi Exchangeco or Vivendi Holdings) among
the shareholders of such subsidiary for the purpose of winding up its affairs,
and any such transactions are expressly permitted by this Article 9.
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ARTICLE 10
AMENDMENTS AND SUPPLEMENTAL TRUST AGREEMENTS
10.1 AMENDMENTS, MODIFICATIONS, ETC.
Subject to sections 10.2, 10.4 and 12.1, this Agreement may not be
amended or modified except by an agreement in writing executed by Vivendi,
Vivendi Exchangeco and the Trustee and approved by the Beneficiaries in
accordance with section 10.2 of the Share Provisions.
10.2 MINISTERIAL AMENDMENTS
Notwithstanding the provisions of section 10.1, the parties to this
Agreement may in writing, at any time and from time to time, without the
approval of the Beneficiaries, amend or modify this Agreement for the purposes
of:
(a) adding to the covenants of any or all parties hereto for the
protection of the Beneficiaries hereunder provided that the
Board of Directors of each of Vivendi Exchangeco, and Vivendi
shall be of the good faith opinion that such additions will
not be prejudicial to the rights or interests of the
Beneficiaries;
(b) making such amendments or modifications not inconsistent with
this Agreement as may be necessary or desirable with respect
to matters or questions that, in the good faith opinion of the
Board of Directors of each of Vivendi and Vivendi Exchangeco
and in the opinion of the Trustee, having in mind the best
interests of the Beneficiaries, it may be expedient to make,
provided that such Boards of Directors and the Trustee, acting
on the advice of counsel, shall be of the opinion that such
amendments and modifications will not be prejudicial to the
interests of the Beneficiaries; or
(c) making such changes or corrections that, on the advice of
counsel to Vivendi, Vivendi Exchangeco and the Trustee, are
required for the purpose of curing or correcting any ambiguity
or defect or inconsistent provision or clerical omission or
mistake or manifest error, provided that the Trustee, acting
on the advice of counsel, and the Board of Directors of each
of Vivendi and Vivendi Exchangeco shall be of the opinion that
such changes or corrections will not be prejudicial to the
rights and interests of the Beneficiaries.
10.3 MEETING TO CONSIDER AMENDMENTS
Vivendi Exchangeco, at the request of Vivendi shall call a meeting or
meetings of the Beneficiaries for the purpose of considering any proposed
amendment or modification
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requiring approval under this Agreement. Any such meeting or meetings shall be
called and held in accordance with the by-laws of Vivendi Exchangeco, the Share
Provisions and all applicable laws.
10.4 CHANGES IN CAPITAL OF VIVENDI AND VIVENDI EXCHANGECO
At all times after the occurrence of any event contemplated under
section 2.7 or 2.8 of the Support Agreement or otherwise, as a result of which
either Vivendi ADSs or the Exchangeable Shares or both are in any way changed,
this Agreement shall forthwith be amended and modified as necessary in order
that it shall apply with full force and effect, mutatis mutandis, to all new
securities into which Vivendi ADSs or the Exchangeable Shares or both are so
changed and the parties hereto shall execute and deliver a supplemental trust
agreement giving effect to and evidencing such necessary amendments and
modifications.
10.5 EXECUTION OF SUPPLEMENTAL TRUST AGREEMENTS
From time to time Vivendi Exchangeco (when authorized by a resolution
of its Board of Directors), Vivendi (when authorized by a resolution of its
Board of Directors) and the Trustee may, subject to the provisions of these
presents, and they shall, when so directed by these presents, execute and
deliver by their proper officers, trust agreements or other instruments
supplemental hereto, which thereafter shall form part hereof, for any one or
more of the following purposes:
(a) evidencing the succession of Vivendi Successors and the
covenants of and obligations assumed by each such Vivendi
Successor in accordance with the provisions of Article 9 and
the successors of any successor trustee in accordance with the
provisions of Article 8;
(b) making any additions to, deletions from or alterations of the
provisions of this Agreement or the Exchange Right or the
Automatic Exchange Right that, in the opinion of the Trustee,
acting on the advice of counsel, will not be prejudicial to
the interests of the Beneficiaries or are, in the opinion of
counsel to the Trustee, necessary or advisable in order to
incorporate, reflect or comply with any legislation the
provisions of which apply to Vivendi, Vivendi Exchangeco, the
Trustee or this Agreement; and
(c) for any other purposes not inconsistent with the provisions of
this Agreement, including without limitation, to make or
evidence any amendment or modification to this Agreement as
contemplated hereby, provided that, in the opinion of the
Trustee, the rights of the Trustee and Beneficiaries will not
be prejudiced thereby.
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ARTICLE 11
TERMINATION
11.1 TERM
The Trust created by this Agreement shall continue until the earliest
to occur of the following events:
(a) no outstanding Exchangeable Shares are held by a Beneficiary;
(b) each of Vivendi and Vivendi Exchangeco elects in writing to
terminate the Trust and such termination is approved by the
Beneficiaries in accordance with section 10.2 of the Share
Provisions; and
(c) 21 years after the death of the last survivor of the
descendants of His Majesty King Xxxxxx VI of Canada and the
United Kingdom of Great Britain and Northern Ireland living on
the date of the creation of the Trust.
there are no Exchangeable Shares outstanding held by a Beneficiary; provided,
however, that the provisions of Articles 6 and 7 shall survive any such
termination of this Agreement.
ARTICLE 12
GENERAL
12.1 SEVERABILITY
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule or 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 hereto 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 the
transactions contemplated hereby are fulfilled to the fullest extent possible.
12.2 ENUREMENT
This Agreement shall be binding upon and enure to the benefit of the
parties hereto and their respective successors and permitted assigns and to the
benefit of the Beneficiaries.
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12.3 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):
(a) if to Vivendi or Vivendi Exchangeco, at:
c/o Vivendi
-
-
Attention: -
Telecopier No.: -
(b) if to the Trustee, at:
-
-
-
Xxxxxxx, Xxxxxxx, Xxxxxx
Attention: Manager, Corporate Trust
Telecopier No.: (416) -
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.
12.4 NOTICE TO BENEFICIARIES
Any and all notices to be given and any documents to be sent to any
Beneficiaries may be given or sent to the address of such Beneficiary shown on
the register of holders of Exchangeable Shares in any manner permitted by the
by-laws of Vivendi Exchangeco from time to time in force in 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
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which by-laws shall apply mutatis mutandis to notices or documents as aforesaid
sent to such Beneficiaries.
12.5 COUNTERPARTS
This 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.
12.6 JURISDICTION
This Agreement shall be construed and enforced in accordance with the
laws of the Province of Ontario and the laws of Canada applicable therein.
12.7 ATTORNMENT
Each of the Trustee, Vivendi and Vivendi Exchangeco agrees that any
action or proceeding arising out of or relating to this Agreement may be
instituted in the courts of Ontario, 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 judgment of the said courts and not to seek, and hereby
waives, any review of the merits of any such judgment by the courts of any other
jurisdiction and Vivendi hereby appoints Vivendi Exchangeco at its registered
office in the Province of Ontario as attorney for service of process.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
VIVENDI
By:
---------------------------
Name:
Title:
3744531 CANADA INC.
By:
---------------------------
Name:
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Title:
-
By:
---------------------------
Name:
Title:
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