EXHIBIT 10.60
MULTI PARTY SHARE PLEDGE ACKNOWLEDGEMENT AGREEMENT
BETWEEN:
ROYNAT CAPITAL INC.
(referred to herein as "ROYNAT")
OF THE FIRST PART
- and -
BANK OF NOVA SCOTIA
(referred to herein as "BNS")
OF THE SECOND PART
- and -
REGAL GIFTS & GREETINGS CORPORATION AND RGG
ACQUISITION INC.
(together, the "PLEDGORS", and individually, a "PLEDGOR")
OF THE THIRD PART
WHEREAS RoyNat Capital and BNS have each advanced certain amounts to
Regal Greetings & Gifts Corporation (the "BORROWER") pursuant to offers of
finance dated as of December 4, 2001, in the case of RoyNat Capital, and dated
as of December 2001, in the case of BNS;
AND WHEREAS each Pledgor has executed one or more securities pledge
agreements (collectively the "SENIOR PLEDGES") dated the date hereof in favour
of BNS as security for its obligations in respect of the senior loan facility
made available by BNS to the Borrower (the "SENIOR LOAN");
AND WHEREAS pursuant to the Senior Pledges, each Pledgor has pledged in
favour of BNS all of the issued and outstanding shares of the corporations
identified in Schedule "A" attached hereto (the "SHARES");
AND WHEREAS the Pledgors have delivered the Shares to BNS to hold in
accordance with the terms of the Senior Pledges;
AND WHEREAS each Pledgor has also executed one or more securities pledge
agreements (collectively the "SUBORDINATE PLEDGES") dated the date hereof in
favour of RoyNat Capital as security for its obligations pursuant to a
subordinated credit facility made available by RoyNat Capital to the Borrower;
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AND WHEREAS pursuant to the Subordinate Pledges, the Pledgors have also
pledged in favour of RoyNat Capital all of the Shares;
AND WHEREAS RoyNat Capital and BNS have agreed that BNS shall retain
physical possession of all of the Shares until repayment in full of the
indebtedness to BNS under the Senior Loan and termination of the Senior Loan;
AND WHEREAS the Pledgors, BNS and RoyNat Capital have further agreed that
upon the repayment in full of the indebtedness to BNS under the Senior Loan and
termination of the Senior Loan, BNS is authorized and directed to deliver all of
the Shares to RoyNat Capital;
NOW THEREFORE THIS AGREEMENT WITNESSES THAT, for good and valuable
consideration, the receipt and sufficiency of which is hereby irrevocably
acknowledged by the parties, the parties agrees as follows:
1. BNS shall retain possession of all of the Shares (including any
replacements thereof and including any subsequently issued shares in any
corporation identified on Schedule "A" attached hereto), to be held by
BNS in accordance with the terms of the Senior Pledges and until
repayment in full of indebtedness to BNS under the Senior Loan and
termination of the Senior Loan.
2. Upon the repayment in full of the indebtedness to BNS under the Senior
Loan and termination of the Senior Loan, BNS is irrevocably authorized
and directed to deliver all of the Shares to RoyNat Capital, to be held
by RoyNat Capital in accordance with the terms of the Subordinate
Pledges.
3. The Pledgors acknowledges, and BNS and RoyNat Capital agree, that BNS
shall stand possessed of the Shares, for purposes of Section 22 of the
PERSONAL PROPERTY SECURITY ACT (Ontario), for and on behalf of itself and
on behalf of RoyNat Capital.
4. The Pledgors acknowledge that they shall have no rights under this
Agreement nor shall this Agreement in any way affect the terms of any
agreement between any of them and BNS or any of them and RoyNat Capital.
5. This Agreement shall ensure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
This Agreement may be assigned by RoyNat Capital and/or BNS to any other
person and, if so assigned, the assignee shall have and be entitled to
exercise any and all discretions, rights and powers of the assignor and
receive the benefits of the assignor hereunder, and all references herein
to BNS or RoyNat Capital shall include any assignee of each.
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6 This Agreement shall be governed by the laws of the Province of Ontario
and the federal laws of Canada applicable therein.
DATED as of the 14th day of December, 2001.
BANK OF NOVA SCOTIA
By:
--------------------
ROYNAT CAPITAL INC.
By:
--------------------
REGAL GREETINGS & GIFTS
CORPORATION
By:
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RGGA ACQUISITION INC.
By:
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SCHEDULE "A"
PLEDGOR CORPORATION CLASS OF SHARES NUMBER OF SHARES
Regal Greeting & Gifts Primes De Luxe Inc. common 100
Corporation
Regal Greetings & Gifts MDC Regal Inc. common 1
Corporation
RGG Acquisition Inc. Regal Greetings & Gifts common 75,650
Corporation
