Exhibit 99.4
PARAMOUNT RESOURCES LTD.
U.S. $125,000,000
8 7/8% Senior Notes due 2014
UNDERWRITING AGREEMENT
June 24, 0000
Xxx Xxxx, Xxx Xxxx
UBS Securities LLC
As representative of the several Underwriters
Named in SCHEDULE I hereto
c/o UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
Paramount Resources Ltd., an Alberta corporation (the "COMPANY"),
proposes to issue and sell to the several Underwriters named in SCHEDULE I
hereto (the "UNDERWRITERS") U.S.$125,000,000 aggregate principal amount of 8
7/8% Senior Notes due 2014 (the "SECURITIES"), subject to the terms and
conditions set forth herein. UBS Securities LLC shall act as representative
("REPRESENTATIVE") of the several Underwriters. The Securities will be issued
pursuant to an indenture (the "BASE INDENTURE"), to be dated the Closing Date
(as defined herein) between the Company and The Bank of Nova Scotia Trust
Company of New York as trustee (the "TRUSTEE"), as supplemented by a
supplemental indenture (the "SUPPLEMENTAL INDENTURE" and together with the Base
Indenture, the "INDENTURE"), to be dated the Closing Date, between the Company
and the Trustee.
Upon the closing of the offering of the Securities, the Company
will make a loan represented by an intercompany note (the "NEWCO MIRROR NOTE")
of U.S. $125,000,000 to Paramount Finance Ltd. ("NEWCO"), a corporation
organized under the laws of Alberta and a wholly owned subsidiary of the
Company. The Company will pledge the Newco Mirror Note and its interest in the
Partnership Mirror Note and the Mirror Note Guarantees (each as defined below)
to the Trustee to secure the Company's obligations under the Securities pursuant
to a pledge agreement between the Company and the Trustee (the "PARAMOUNT PLEDGE
AGREEMENT"). Newco will in turn make a loan represented by an intercompany note
(the "PARTNERSHIP MIRROR NOTE" and, together with the Newco Mirror Note, the
"MIRROR NOTES") of U.S.$125,000,000 to Paramount Resources, an Alberta general
partnership (the "PARTNERSHIP"). The Partnership Mirror Note and the related
Mirror Note Guarantees will be pledged to the Company by Newco to secure Newco's
obligations under the Newco Mirror Note pursuant to a pledge agreement between
Newco and the Company (the "NEWCO PLEDGE AGREEMENT" and, together with the
Paramount Pledge Agreement, the "PLEDGE AGREEMENTS"). The obligations of Newco
to the Company under its Mirror Note and the obligations of the Partnership
under its Mirror Note will be initially guaranteed (the "MIRROR NOTE
GUARANTEES") by each of the Company's wholly owned
restricted subsidiaries (each, a "MIRROR NOTE GUARANTOR") that guarantees the
Company's credit facility or has otherwise guaranteed or incurred in excess of
US$2.0 million of debt.
SECTION 1. REGISTRATION STATEMENT AND PROSPECTUSES. The Company
represents and warrants to, and agrees with, each of the Underwriters that:
(i) The Company meets the requirements under the Securities
Act (Alberta) (the "ASA") and the rules, regulations,
national, multijurisdictional or local instruments and
published policy statements applicable in the Province of
Alberta, including the rules and procedures established
for the use of a shelf prospectus pursuant to National
Instrument 44-102 - Shelf Distributions (the "SHELF
PROCEDURES"), for use of a short form prospectus with
respect to the Securities pursuant to National Instrument
44-101 - Short Form Prospectus Distributions
(collectively, "ALBERTA SECURITIES LAWS"); a preliminary
short form base shelf prospectus (the "CANADIAN
PRELIMINARY PROSPECTUS" and a (final) short form base
shelf prospectus (the "CANADIAN SHELF PROSPECTUS")
relating to debt securities of the Company to be offered
for sale outside of Canada have been filed with the
Alberta Securities Commission in the Province of Alberta
(the "ASC"); the ASC has issued a receipt for the
Canadian Shelf Prospectus; the Company will prepare and
file, promptly after the execution and delivery of this
Agreement, with the ASC, in accordance with the Shelf
Procedures, a supplement to the Canadian Shelf Prospectus
with respect to the Securities in a form approved by the
Representative acting reasonably (the "PROSPECTUS
SUPPLEMENT"); the Canadian Shelf Prospectus for which a
final receipt has been received from the ASC, including
the documents incorporated by reference therein, is
herein referred to as the "CANADIAN PROSPECTUS" until
such time as the Prospectus Supplement is filed with the
ASC pursuant to the Shelf Procedures, at which time
"Canadian Prospectus" shall mean the Canadian Shelf
Prospectus as supplemented by the Prospectus Supplement;
no order having the effect of ceasing or suspending the
distribution of the Securities has been issued by the ASC
and no proceeding for that purpose has been initiated or,
to the knowledge of the Company, threatened by the ASC.
(ii) The Company meets the general eligibility requirements
for use of Form F-10 under the Securities Act of 1933, as
amended (the "SECURITIES ACT"), and a registration
statement on Form F-10 (File No. 333-116315) covering the
registration of the debt securities of the Company under
the Securities Act has been filed with the United States
Securities and Exchange Commission (the "COMMISSION");
such registration statement and any post-effective
amendment thereto (including the Canadian Shelf
Prospectus with such deletions therefrom and additions
thereto as are permitted or required by Form F-10 and the
applicable rules and regulations of the Commission), each
in the form heretofore delivered to you and each of the
other Underwriters (including all documents incorporated
by reference in the prospectus contained therein), have
been
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declared effective by the Commission in such form; no
other document with respect to such registration
statement or documents incorporated by reference therein
has heretofore been filed or transmitted for filing with
the Commission; no stop order suspending the
effectiveness of such registration statement has been
issued and no proceeding for that purpose has been
initiated or, to the knowledge of the Company, threatened
by the Commission; any preliminary prospectus included in
such registration statement or filed with the Commission
in accordance with the rules and regulations of the
Commission under the Securities Act, is hereinafter
called a "U.S. PRELIMINARY PROSPECTUS"; the various parts
of such registration statement, including all exhibits
thereto and the documents incorporated by reference in
the prospectus contained in the registration statement at
the time such part of the registration statement became
effective, each as amended at the time such part of the
registration statement became effective, but excluding
the Statement of Eligibility on Form T-1 under the Trust
Indenture Act of 1939, as amended (the "TRUST INDENTURE
ACT"), are hereinafter collectively called the
"REGISTRATION STATEMENT"; the Company will prepare and
file, promptly after the execution and delivery of this
Agreement, with the Commission, in accordance with
General Instruction II.L of Form F-10, the Prospectus
Supplement; the prospectus included in the Registration
Statement at the time it became effective, including the
documents incorporated by reference therein, is herein
called the "U.S. PROSPECTUS" until such time as the
Prospectus Supplement is filed with the Commission in
accordance with General Instruction II.L of Form F-10, at
which time "U.S. Prospectus" shall mean such prospectus
as supplemented by the Prospectus Supplement; the U.S.
Preliminary Prospectus and the Canadian Preliminary
Prospectus are hereinafter collectively called the
"PRELIMINARY PROSPECTUSES" and the U.S. Prospectus and
the Canadian Prospectus are hereinafter called the
"PROSPECTUSES."
(iii) The Company has prepared and filed with the Commission an
appointment of agent for service of process upon the
Company on Form F-X in conjunction with the filing of the
Registration Statement (the "FORM F-X"). The Company has
also caused the Trustee to prepare and file with the
Commission a Statement of Eligibility under the Trust
Indenture Act on Form T-1 (the "FORM T-1").
(iv) No order preventing or suspending the use of the U.S.
Preliminary Prospectus or the U.S. Prospectus has been
issued by the Commission, and each U.S. Preliminary
Prospectus and the U.S. Prospectus, at the time of filing
thereof, conformed in all material respects to the
requirements of the Securities Act and the Trust
Indenture Act, and the rules and regulations of the
Commission thereunder, and did not contain an untrue
statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances
under which they were made, not misleading; PROVIDED,
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HOWEVER, that this representation and warranty shall not
apply to any statements or omissions made in reliance
upon and in conformity with information furnished in
writing to the Company by an Underwriter through UBS
Securities LLC expressly for use therein.
(v) No order preventing or suspending the use of the Canadian
Preliminary Prospectus or the Canadian Prospectus has
been issued by the ASC, and the Canadian Preliminary
Prospectus and the Canadian Prospectus, at the time of
filing thereof, conformed in all material respects to the
requirements of the Alberta Securities Laws, and did not
contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein, in the light of
the circumstances under which they were made, not
misleading; PROVIDED, HOWEVER, that this representation
and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an
Underwriter through UBS Securities LLC expressly for use
therein.
(vi) The documents incorporated by reference in the
Prospectuses, when they were filed with the ASC,
conformed in all material respects to the requirements of
the Alberta Securities Laws and none of such documents
contained an untrue statement of a material fact or
omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading in light of the circumstances under which they
were made; and any further documents so filed and
incorporated by reference in the Prospectuses or any
further amendment or supplement thereto, as of the
applicable filing date or effective date, as the case may
be, will conform in all material respects to the
applicable requirements of the Alberta Securities Laws
and will not contain an untrue statement of a material
fact or omit to state a material fact required to be
stated therein or necessary to make the statements
therein not misleading in light of the circumstances
under which they were made; PROVIDED, HOWEVER, that this
representation and warranty shall not apply to any
statements or omissions made in reliance upon and in
conformity with information furnished in writing to the
Company by an Underwriter through UBS Securities LLC
expressly for use therein.
(vii) As of the applicable filing date or effective date, as
the case may be, (A) the Canadian Prospectus and any
amendments or supplements thereto complied and will
comply in all material respects with the Alberta
Securities Laws; (B) the U.S. Prospectus and the
Registration Statement and any amendments or supplements
thereto complied and will comply in all material respects
with the requirements of the Securities Act and the
applicable rules and regulations of the Commission under
the Securities Act and the Trust Indenture Act; (C) the
Form F-X and any amendments or supplements thereto
complied and will comply in all material respects with
the applicable requirements of the Securities Act and the
applicable
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rules and regulations of the Commission under the
Securities Act; (D) neither the Registration Statement
nor any amendment or supplement thereto, together with
each document incorporated therein by reference (as
modified or superseded by the Registration Statement, any
amendment or supplement thereto or any subsequent
document incorporated therein by reference), contained or
will contain an untrue statement of a material fact or
omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading; (E) the Canadian Prospectus and any amendment
or supplement thereto, together with each document
incorporated therein by reference (as modified or
superseded by the Canadian Prospectus, any amendment or
supplement thereto or any subsequent document
incorporated therein by reference), constituted and will
constitute full, true and plain disclosure of all
material facts relating to the Securities; and (F) the
U.S Prospectus and any amendment or supplement thereto,
together with each document incorporated therein by
reference (as modified or superseded by the U.S.
Prospectus, any amendment or supplement thereto or any
subsequent document incorporated therein by reference)
did not and will not include an untrue statement of a
material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of
the circumstances under which they were made, not
misleading; PROVIDED, HOWEVER, that the representations
and warranties in this subsection (vii) shall not apply
to any statements or omissions made in reliance upon and
in conformity with information furnished in writing to
the Company by an Underwriter through UBS Securities LLC
expressly for use therein.
(viii) There are no reports or information that in accordance
with the requirements of the ASC must be made publicly
available in connection with the offering of the
Securities that have not been made publicly available as
required; there are no contracts, documents or other
materials required to be filed with the ASC prior to the
date hereof in connection with the Canadian Prospectus
that have not been filed as required; there are no
contracts, documents or other materials required to be
described or referred to in the Canadian Prospectus or
filed as exhibits to the Registration Statement that are
not described, referred to or filed as required.
SECTION 2. AGREEMENTS TO SELL AND PURCHASE AND LOCK-UP AGREEMENT. On the
basis of the representations and warranties contained in this Agreement, and
subject to the terms and conditions contained herein, the Company agrees to
issue and sell, and each Underwriter agrees, severally and not jointly, to
purchase from the Company at a purchase price equal to 100% of the principal
amount thereof (the "PURCHASE PRICE") an aggregate principal amount of
Securities set forth opposite the name of such Underwriter in SCHEDULE I hereto.
In consideration for the Underwriters' agreement to purchase the Securities, and
in consideration for their services hereunder, the Company shall pay to the
Representative, for the account of the Underwriters, a commission of 2% of the
principal amount of Securities (the "UNDERWRITING FEE").
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The Company hereby agrees not to, during the period from the date
hereof to and including the Closing Date, without the prior written consent of
the Representative, directly or indirectly, offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase or otherwise transfer or
dispose of any Securities or securities which are substantially similar to the
Securities, or any securities convertible into or exchangeable into or
exercisable for the Securities, or any substantially similar securities, or file
any registration statement under the Securities Act with respect to any of the
foregoing. The foregoing sentence shall not apply to any Securities sold
pursuant to this Agreement.
SECTION 3. TERMS OF PUBLIC OFFERING.
(a) The Company is advised by you that the Underwriters propose (i)
to make a public offering in the United States of their
respective portions of the Securities as soon after the execution
and delivery of this Agreement as in your judgment is advisable
and (ii) initially to offer the Securities upon the terms set
forth in the Prospectuses.
(b) Each of the Underwriters, severally and not jointly, agrees with
the Company that it will not sell any Securities purchased by it
from the Company pursuant to this Agreement in any province or
territory of Canada unless the sale is made: (i) through an
appropriately registered dealer or in accordance with an
exemption from the dealer registration requirements of applicable
securities laws; and (ii) pursuant to an exemption from the
prospectus requirements of applicable securities laws.
SECTION 4. DELIVERY AND PAYMENT. Delivery of, and payment of the Purchase
Price for, the Securities shall be made at 9:00 A.M., New York City time, on
June 29, 2004 or at such other time on the same date or such other date as shall
be agreed upon by the Representative and the Company in writing. The time and
date of such delivery and the payment for the Securities are herein called the
"CLOSING DATE."
One or more of the certificates (in denominations of U.S.$1,000
or integral multiples thereof) in definitive global form, registered in the name
of Cede & Co., as nominee of The Depository Trust Company ("DTC"), having an
aggregate principal amount corresponding to the aggregate principal amount of
the Securities purchased by the Underwriters hereunder (collectively, the
"GLOBAL NOTE"), shall be delivered by the Company to the Representative (or as
the Representative directs) in each case with any transfer taxes thereon,
against payment by the Underwriters of the Purchase Price thereof less the
Underwriting Fee by electronic transfer of immediately available Funds to an
account specified by the Company at least 2 business days prior to the Closing
Date. The Global Note shall be made available to the Underwriters for inspection
not later than 9:30 A.M., New York City time, on the business day immediately
preceding the Closing Date.
The documents to be delivered on the Closing Date on behalf of
the parties hereto pursuant to Section 8 of this Agreement shall be delivered at
the offices of Xxxxxxx Xxxxx LLP, 3700 Canterra Tower, 000 0xx Xxxxxx X.X.,
Xxxxxxx, Xxxxxxx X0X 0X0, Xxxxxx, or such other
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location as may be mutually acceptable and the Securities shall be delivered as
specified by the Representative, all on the Closing Date.
SECTION 5. AGREEMENTS OF THE COMPANY. The Company agrees with you as
follows:
(a) To prepare the Prospectus Supplement in a form approved by you,
acting reasonably, and (i) to file such Prospectus Supplement
with the ASC in accordance with the Shelf Procedures not later
than the ASC's close of business on the first business day
following the execution and delivery of this Agreement and
(ii) to file such Prospectus Supplement with the Commission
pursuant to General Instruction II.L. of Form F-10 not later than
the Commission's close of business on the first business day
following the day that the filing of the Prospectus Supplement is
made with the ASC; to notify the Underwriters promptly, and
confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement shall have been filed
with the Commission or shall have become effective, and when any
supplement or amendment to the Prospectuses shall have been
filed, (ii) of the receipt of any comments from the ASC or the
Commission, (iii) of any request by the ASC to amend or
supplement the Canadian Shelf Prospectus or the Canadian
Prospectus or for additional information, or of any request by
the Commission to amend the Registration Statement or to amend or
supplement the U.S. Prospectus or for additional information,
(iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of
any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the
institution or, to the knowledge of the Company, the threatening
of any proceedings for any such purpose, and (v) of the issuance
by the ASC of any order having the effect of ceasing or
suspending the distribution of the Securities or the trading in
the securities of the Company, or of the institution or, to the
knowledge of the Company, the threatening of any proceedings for
any such purpose; to use its best efforts to prevent the issuance
of any such stop order or of any order preventing or suspending
such use or such order ceasing or suspending the distribution of
the Securities or the trading in the securities of the Company
and, if any such order is issued, to promptly use its best
efforts to obtain the withdrawal of such order at the earliest
possible time; to file promptly all reports required to be filed
by the Company (i) with the Commission pursuant to Section 13(a),
13(c) or 15(d) of the Securities Exchange Act of 1934 (the
"EXCHANGE ACT"), and (ii) with the ASC in accordance with Alberta
Securities Laws, in each case subsequent to the date of the
Prospectuses and for so long as the delivery of a prospectus is
required in connection with the offering or sale of the
Securities, and to make no further amendment or any supplement to
the Registration Statement or the Prospectuses unless approved by
you (which approval shall not be unreasonably withheld) after
reasonable notice thereof;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities for offering and
sale under the securities laws of such jurisdictions in the
United States as you may reasonably request and to comply
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with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Securities,
PROVIDED that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction and further
provided that nothing contained in this Section 5(b) shall
require the Company to file or qualify a prospectus in any
province or territory of Canada, other than Alberta (for the
purpose of qualifying under Alberta Securities Laws the
distribution of the Securities in the United States), in
connection with an offer and sale of the Securities in any such
province or territory;
(c) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Securities Act, any event
occurs as a result of which, in the determination of the Company
after consultation with the Underwriters, the Prospectuses would
include any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein in the
light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend the Registration
Statement or the Prospectuses to comply with Alberta Securities
Laws, the Securities Act or the Exchange Act, or the respective
rules thereunder, the Company promptly will (i) notify the
Representative of such event, (ii) prepare and file with the ASC
and the Commission, subject to the first sentence of paragraph
(a) of this Section 5, an amendment or supplement which will
correct such statement or omission or effect such compliance and
(iii) supply any amended Canadian Prospectus, U.S. Prospectus and
Registration Statement to the Representative in such quantities
as it may reasonably request.
(d) Prior to 5:00 P.M., New York City time, on the New York business
day next succeeding the date of this Agreement and from time to
time until the distribution of the Securities has been completed,
to furnish the Underwriters with written and electronic copies of
the U.S. Prospectus (including the Prospectus Supplement) or
supplements in New York City in such quantities as you may
reasonably request, and, if the delivery of a prospectus is
required by applicable law, if at such time any event shall have
occurred as a result of which the Prospectuses as then amended or
supplemented would include an untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which
they were made when such Prospectuses are delivered, not
misleading, or, if for any other reason it shall be necessary to
amend or supplement the Prospectuses or to file under Alberta
Securities Laws or under the Exchange Act any document
incorporated by reference in the Prospectuses in order to comply
with Alberta Securities Laws, the Securities Act, the Exchange
Act or the Trust Indenture Act, to notify you and upon your
request to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as
many written and electronic copies as you may from time to time
reasonably request of amended Prospectuses or supplements to the
Prospectuses which will correct such statement or omission or
effect such compliance. The Company has furnished or will deliver
to the Underwriters and counsel for the Underwriters, without
charge,
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a copy of the Canadian Preliminary Prospectus and the Canadian
Shelf Prospectus, approved, signed and certified as required by
the Alberta Securities Laws, and signed copies of the
Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by
reference therein and including a signed copy of the Form F-X)
and signed copies of all consents and certificates of experts;
the copies of the Canadian Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be
identical to the electronically transmitted copies thereof filed
with the ASC pursuant to the System for Electronic Document
Analysis and Retrieval (SEDAR);
(e) The Company will cooperate with you and counsel for the
Underwriters in connection with the registration or qualification
of the Securities for offer and sale by the several Underwriters
and by dealers under the state securities or Blue Sky laws of
such jurisdictions in the United States as you may reasonably
request, to continue such registration or qualification in effect
so long as reasonably required for distribution of the Securities
and to file such consents to service of process or other
documents as may be necessary in order to effect such
registration or qualification; PROVIDED, HOWEVER, that the
Company shall not be required in connection therewith to qualify
as a foreign corporation in any jurisdiction in which it is not
now so qualified or to take any action that would subject it to
general consent to service of process or taxation other than as
to matters and transactions relating to the Prospectuses, the
Registration Statement or the offering or sale of the Securities,
in any jurisdiction in which it is not now so subject.
(f) To make generally available to its securityholders as soon as
practicable, but in any event not later than twelve months after
the effective date of the Registration Statement (as defined in
Rule 158(c) under the Securities Act), an earnings statement of
the Company and its subsidiaries (which need not be audited)
complying with Section 11(a) of the Securities Act and the rules
and regulations thereunder (including Rule 158 under the
Securities Act);
(g) Whether or not the transactions contemplated in this Agreement
are consummated or this Agreement is terminated, to pay or cause
to be paid all expenses incidental to the performance of its
obligations under this Agreement, including: (i) the fees,
disbursements and expenses of the Company's counsel and the
Company's accountants in connection with the qualification for
distribution of the Securities under Alberta Securities Laws, the
registration and delivery of the Securities under the Securities
Act and all other fees and expenses in connection with the
preparation, printing, filing and distribution of the
Registration Statement (including financial statements and
exhibits), the U.S. Preliminary Prospectus, the U.S. Prospectus,
the Canadian Preliminary Prospectus and the Canadian Prospectus
and all amendments and supplements to any of the foregoing,
including the mailing and delivering of copies thereof to the
Underwriters and dealers in the quantities specified herein, (ii)
all costs and expenses related to the transfer and delivery of
the Securities to the Underwriters, including any transfer
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or other taxes payable thereon, (iii) all expenses in connection
with the registration or qualification of the Securities for
offer and sale under the securities or Blue Sky laws of the
several states and all costs of printing or producing any
Preliminary and Supplemental Blue Sky Memoranda in connection
therewith (including the filing fees and reasonable fees and
disbursements of counsel for the Underwriters in connection with
such registration or qualification and memoranda relating
thereto), (iv) the cost of printing certificates representing the
Securities, (v) the costs and charges of any transfer agent,
registrar and/or depositary (including DTC), (vi) the fees and
expenses of the Trustee, including the reasonable fees and
disbursements of counsel for the Trustee in connection with the
Indenture and the Securities, (vii) any fees charged by rating
agencies for the rating of the Securities, and (viii) all other
costs and expenses incidental to the performance of the
obligations of the Company hereunder for which provision is not
otherwise made in this Section.
(h) To do and perform all things required or necessary to be done and
performed under this Agreement by the Company prior to and after
the Closing Date, as the case may be, and to satisfy all
conditions precedent to the delivery of the Securities.
(i) To use the net proceeds received by it from the sale of the
Securities pursuant to this Agreement in the manner specified in
the Prospectuses under the caption "Use of Proceeds."
(j) To not take, directly or indirectly, any action which is designed
to or which has constituted or which might be reasonably be
expected to cause or result in stabilization or manipulation of
the price of any security of the Company to facilitate the sale
or distribution of the Securities in violation of applicable
securities laws.
(k) To obtain the approval of DTC for "book-entry" transfer of the
Securities, and to comply in all material respects with all of
its agreements set forth in the representation letters of the
Company to DTC relating to the approval of the Securities by DTC
for "book-entry" transfer.
(l) Prior to the filing of any prospectus supplement or amendment,
the Company shall allow the Underwriters to conduct all due
diligence investigations which they reasonably require in order
to fulfill their obligations as underwriters under the applicable
laws.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to each Underwriter that:
(a) The Company has been duly incorporated, is validly existing under
the laws of its jurisdiction of incorporation, amalgamation or
continuance and has the corporate power and authority to carry on
its business as described in the Prospectuses and to own, lease
and operate its properties and assets, and is duly qualified and
is in
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good standing as a corporation authorized to do business in each
jurisdiction in which the nature of its business or its ownership
or leasing of property requires such qualification, except where
the failure to be so qualified would not have a material adverse
effect on the business, properties, prospects, financial
condition or results of operations of the Company and its
Subsidiaries (as defined herein), taken as a whole (a "MATERIAL
ADVERSE EFFECT").
(b) The Company's only direct or indirect subsidiaries are listed on
SCHEDULE II hereto (collectively, the "SUBSIDIARIES" and
individually, a "SUBSIDIARY"). Except as would not have a
Material Adverse Effect, each Subsidiary (i) is a corporation or
partnership duly incorporated or formed, as the case may be,
validly existing and, to the extent required under applicable
law, in good standing under the laws of the jurisdiction of its
incorporation or formation, as applicable, (ii) has the corporate
or partnership power, as the case may be, and authority under
such laws to own, lease and operate its properties and conduct
its business as described in the Prospectuses and (iii) is duly
qualified to transact business as a foreign corporation or
partnership, as the case may be, and is in good standing in each
other jurisdiction in which it owns or leases property of a
nature, or transacts business of a type, that would make such
qualification necessary.
(c) There are no outstanding subscriptions, rights, warrants,
options, calls, convertible securities, commitments of sale or
liens granted or issued by the Subsidiaries relating to or
entitling any person to purchase or otherwise acquire any shares
in the capital of the Subsidiaries, except (i) as otherwise
disclosed in the Registration Statement and the Prospectuses;
(ii) as described in Section 6(g) below; or (iii) as would not
individually or in the aggregate have a Material Adverse Effect.
(d) The authorized, issued and outstanding share capital and debt of
the Company was as set forth in the Prospectuses and the
Registration Statement under the caption "Capitalization," at the
date indicated, and all the outstanding shares of the Company
have been duly authorized and validly issued and are fully paid,
non-assessable and not subject to any preemptive or similar
rights.
(e) The statements set forth in the Prospectuses, under the captions
"Description of Other Indebtedness" and "Description of the
Notes", insofar as they purport to constitute a summary of the
Securities, and under the caption "Canadian and U.S. Income Tax
Consequences", insofar as they purport to describe the provisions
of the documents, laws and regulations referred to therein,
constitute fair and adequate summaries of the matters referred to
therein.
(f) The Securities have been duly authorized and, on the Closing
Date, will have been validly executed and delivered by the
Company. When the Securities have been authenticated in
accordance with the provisions of the Indenture and delivered to
and paid for by the Underwriters in accordance with the terms of
this Agreement, the Securities will be entitled to the benefits
of the Indenture and will be valid and binding obligations of the
Company, enforceable in accordance with their terms except as (i)
the enforceability thereof may be limited by bankruptcy,
-11-
insolvency (including, without limitation, all laws relating to
fraudulent conveyance) or similar laws affecting creditors'
rights generally and (ii) the availability of equitable remedies
may be limited by equitable principles of general applicability
(regardless of whether enforcement is considered in a proceeding
in equity or at law). On the Closing Date, the Securities will
conform to the description thereof contained in the Prospectuses
and the Indenture.
(g) All of the outstanding and issued shares and all the partnership
interests, as the case may be, of each of Newco, the Partnership
and each of the Subsidiaries that owns in excess of 5% of the
consolidated assets of the Company have been duly authorized and
validly issued and, in the case of shares, are fully paid and
non-assessable, and except as set forth in SCHEDULE II attached
hereto, and, except as disclosed in the Prospectuses, are owned
by the Company, directly or indirectly through one or more
Subsidiaries, free and clear of any security interest, claim,
lien, encumbrance or adverse interest of any nature (each, a
"LIEN") except for Permitted Liens (as defined in the Prospectus
Supplement under the heading "Description of the notes--Certain
definitions") other than any Permitted Liens securing
Indebtedness (as defined in the Prospectus Supplement under the
heading "Description of the notes-Certain definitions").
(h) Except as would not have a Material Adverse Effect, neither the
Company nor any of the Subsidiaries is (i) in violation of its
respective organizational documents, certificate of
incorporation, partnership agreement, charter or by-laws, or (ii)
is in default in the performance of any obligation, agreement,
covenant or condition contained in any indenture, loan agreement,
mortgage, lease or other agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which the
Company or any of the Subsidiaries or their respective property
is bound.
(i) The execution, delivery and performance of this Agreement, the
Indenture, the Mirror Notes, the Mirror Note Guarantees, the
Pledge Agreements and the issuance and delivery of Securities by
the Company and the Subsidiaries, as applicable, the compliance
by the Company and the Subsidiaries, as applicable, with all the
provisions hereof and thereof and the consummation of the
transactions contemplated hereby and thereby will not (i) require
any consent, approval, authorization or other order of, or
qualification with, any court or governmental body or agency
(except such as may be required under U.S. federal securities
laws or Alberta Securities Laws or Blue Sky laws of the various
states), (ii) assuming on the date hereof that the condition set
forth in 8(o) has been met, conflict with or constitute a breach
of any of the terms or provisions of, or a default under, the
articles, charter or by-laws of the Company or any of the
Subsidiaries or any indenture, loan agreement, mortgage, lease or
other agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which the Company or any of the
Subsidiaries or their respective property is bound, except such
conflict, breach or default as would not have, singly or in the
aggregate, a Material Adverse Effect, (iii) violate or conflict
with any applicable law or any rule, regulation, judgment, order
or decree of any court or any
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governmental body or agency having jurisdiction over the Company,
any of the Subsidiaries or their respective property, except such
violations or conflicts as would not have, singly or in the
aggregate, a Material Adverse Effect, (iv) except as created by
the Pledge Agreements, result in the imposition or creation of
(or the obligation to create or impose) a Lien under any
agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which the Company or any of the
Subsidiaries or their respective property is bound, except as
would not have, singly or in the aggregate, a Material Adverse
Effect, or (v) result in the suspension, termination or
revocation of any Authorization (as defined below) of the Company
or any of the Subsidiaries or any other impairment of the rights
of the holder of any such Authorization, except such
terminations, suspensions, revocations or impairments as would
not have, singly or in the aggregate, a Material Adverse Effect.
(j) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened or any related party
transactions to which the Company or any of its Subsidiaries is
or could be a party or to which any of their respective property
is or could be subject, that are required to be described in the
Prospectuses and are not so described.
(k) Except as set forth in the Prospectuses and except as would not
have a Material Adverse Effect, the Company and the Subsidiaries
are (i) in compliance with any and all applicable laws, statutes,
ordinances, regulations, rules, decrees, orders, judgments,
consent orders, consent decrees or other binding requirements and
the common law relating to the protection of public health or the
environment or the release or threatened release of hazardous
material (including, without limitation, any material, substance,
waste, constituent, compound, pollutant or contaminant,
including, without limitation, petroleum (including, without
limitation, crude oil or any fraction thereof or any petroleum
product)) (collectively, "ENVIRONMENTAL LAWS") and (ii) each of
the Company and its Subsidiaries is in compliance with all terms
and conditions of any required permits, licenses and
authorizations, and is also in compliance with all other
applicable limitations, restrictions, conditions, standards,
prohibitions, requirements and obligations contained in the
Environmental Laws.
(l) Except as set forth in the Prospectuses and except as would not
have a Material Adverse Effect, the Company and its Subsidiaries
have such permits, licenses, consents, exemptions, franchises,
authorizations and other approvals (each, an "AUTHORIZATION") of,
and have made all filings with and notices to, all governmental
or regulatory authorities and self-regulatory organizations and
all courts and other tribunals, including, without limitation,
under any applicable laws regulating Environmental Laws, as are
necessary to own, lease, license and operate their respective
properties and to conduct their business, except where the
failure to have any such Authorization or to make any such filing
or notice would not, singly or in the aggregate, have a Material
Adverse Effect. Except as disclosed in the Prospectuses, each
such Authorization is valid and in full force and effect and the
Company and the Subsidiaries are in compliance with all the
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terms and conditions thereof and with the rules and regulations
of the authorities and governing bodies having jurisdiction with
respect thereto; and no event has occurred (including, without
limitation, the receipt of any notice from any authority or
governing body) which allows or, after notice or lapse of time or
both, would allow, revocation, suspension or termination of any
such Authorization or results or, after notice or lapse of time
or both, would result in any other impairment of the rights of
the holder of any such Authorization; except where such failure
to be valid and in full force and effect or to be in compliance,
the occurrence of any such event or the presence of any such
restriction would not, singly or in the aggregate, have a
Material Adverse Effect.
(m) This Agreement has been duly authorized, executed and delivered
by the Company.
(n) The Indenture has been duly authorized by the Company and, on the
Closing Date, will have been validly executed and delivered by
the Company. When the Indenture has been validly executed and
delivered by the Company (assuming the due authorization,
execution and delivery by the Trustee), the Indenture will be a
valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
conveyance) or similar laws affecting creditors' rights generally
and (ii) the availability of equitable remedies may be limited by
equitable principles of general applicability (regardless of
whether enforcement is considered in a proceeding in equity or at
law). On the Closing Date, the Indenture will conform in all
material respects to the requirements of the Trust Indenture Act,
the rules and regulations of the Commission applicable to an
indenture which is qualified thereunder and to the requirements
of the Business Corporations Act (Alberta) (the "ABCA") (except
to the extent that exemptive relief has been obtained).
(o) The Newco Mirror Note has been duly authorized and, when executed
and delivered by Newco, will constitute the legal, valid and
binding obligation of Newco enforceable against Newco in
accordance with its terms except as (i) the enforceability
thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to fraudulent conveyance)
or similar laws affecting creditors' rights generally and (ii)
rights of acceleration and the availability of equitable remedies
may be limited by equitable principles of general applicability
(regardless of whether enforcement is considered in a proceeding
in equity or at law); the Partnership Mirror Note has been duly
authorized and, when executed and delivered by the Partnership,
will constitute the legal, valid and binding obligation of the
Partnership enforceable against the Partnership in accordance
with its terms except as (i) the enforceability thereof may be
limited by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent conveyance) or similar laws
affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability
(regardless of whether enforcement is considered in a proceeding
in equity or at law).
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(p) The Paramount Pledge Agreement has been duly authorized by the
Company and, when executed by the Company and the Trustee, will
constitute the legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms
except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent conveyance) or similar laws affecting
creditors' rights generally and (ii) rights of acceleration and
the availability of equitable remedies may be limited by
equitable principles of general applicability (regardless of
whether enforcement is considered in a proceeding in equity or at
law). Upon execution by the Company and the Trustee of the
Paramount Pledge Agreement and delivery of the Mirror Notes to
the Trustee, no further action will be required in order for the
Trustee to have a first priority perfected security interest in
the Newco Mirror Note and the Company's interest in the
Partnership Mirror Note other than the registration of notice of
such security interest under the Alberta Personal Property
Security Act.
(q) The Newco Pledge Agreement has been duly authorized by Newco, and
when executed by the Company and Newco, will constitute the
legal, valid and binding obligation of Newco enforceable against
the Company and Newco in accordance with its terms except as (i)
the enforceability thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent conveyance) or similar laws affecting creditors'
rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable
principles of general applicability (regardless of whether
enforcement is considered in a proceeding in equity or at law).
Upon execution by the Company and Newco of the Newco Pledge
Agreement and delivery of the Partnership Mirror Note to the
Company, no further action will be required in order for the
Company to have a first priority perfected security interest in
the Partnership Mirror Note other than the registration of notice
of such security interest under the Alberta Personal Property
Security Act.
(r) The Mirror Note Guarantees have been duly authorized by each
Mirror Note Guarantor and, when executed by each Mirror Note
Guarantor, will constitute the legal, valid and binding
obligation of each Mirror Note Guarantor enforceable against such
Mirror Note Guarantor in accordance with its terms except as (i)
the enforceability thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent conveyance) or similar laws affecting creditors'
rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable
principles of general applicability (regardless of whether
enforcement is considered in a proceeding in equity or at law).
(s) Ernst & Young LLP, the Company's auditors, are independent
chartered accountants and independent public accountants with
respect to the Company, as required by the Securities Act, the
Exchange Act, the ABCA and Alberta Securities Laws. The
historical financial statements of the Company, together with the
related schedules and notes, set forth or incorporated by
reference in the
-15-
U.S. Prospectus comply as to form in all material respects with
the requirements applicable under the Alberta Securities Laws and
to registration statements on Form F-10 under the Securities Act.
(t) (i) The Company's audited consolidated financial statements
included or incorporated by reference in the Registration
Statement and the Prospectuses, together with related schedules
and notes, present fairly, in all material respects, the
consolidated financial position, results of operations and cash
flows of the Company and its Subsidiaries on the basis stated
therein at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes
have been prepared in accordance with Canadian generally accepted
accounting principles ("CANADIAN GAAP") consistently applied
throughout the periods involved, except as disclosed therein, and
have been reconciled to United States generally accepted
accounting principles ("U.S. GAAP") in accordance with the
requirements of Item 18 of Form 20-F; and (ii) the Company's (a)
unaudited consolidated balance sheet as of March 31, 2004 and
December 31, 2003 and (b) the unaudited condensed consolidated
statements of income (loss) and cash flows for the three month
periods ended March 31, 2004 and 2003 included or incorporated by
reference into the Registration Statement and the Prospectuses
present fairly, in all material respects, the consolidated
financial position, results of operations and cash flows of the
Company and its Subsidiaries on the basis stated therein at the
respective dates or for the respective periods to which they
apply and have been prepared in accordance with Canadian GAAP
applied on a basis substantially consistent with that of the
Company's audited consolidated financial statements included or
incorporated by reference into the Registration Statement and the
Prospectuses and have been reconciled to U.S. GAAP in accordance
with the requirements of Item 17 of Form 20-F.
(u) The PRO FORMA financial statements of the Company and its
Subsidiaries and the related notes thereto set forth or
incorporated by reference in the Registration Statement and the
Prospectuses have been prepared on a basis consistent with the
historical financial statements of the Company and its
Subsidiaries, give effect to the assumptions used in the
preparation thereof on a reasonable basis and in good faith and
present fairly the historical transactions contemplated by the
Registration Statement and the Prospectuses. Such PRO FORMA
financial statements have been prepared in accordance with the
applicable requirements of the Alberta Securities Laws and
Canadian GAAP and have been reconciled to U.S. GAAP in accordance
with Item 18 of Form 20-F.
(v) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the net proceeds
therefrom as described in the Prospectuses, will not be required
to register as, an "investment company" as such term is defined
in the Investment Company Act of 1940, as amended.
(w) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require
the Company to file a
-16-
registration statement under the Securities Act or a prospectus
under Alberta Securities Laws with respect to any securities of
the Company or to require the Company to include such securities
with the Securities registered pursuant to the Registration
Statement.
(x) No "nationally recognized statistical rating organization" as
such term is defined for purposes of Rule 436(g)(2) under the
Securities Act (i) has imposed (or has informed the Company that
it is considering imposing) any condition (financial or
otherwise) on the Company's retaining any rating assigned to the
Company or any securities of the Company or (ii) has indicated to
the Company that it is considering (a) the downgrading,
suspension, or withdrawal of, or any review for a possible change
that does not indicate the direction of the possible change in,
any rating so assigned or (b) any change in the outlook for any
rating of the Company or any securities of the Company other than
an upgrade of any rating of the Company or any securities of the
Company.
(y) Since the respective dates as of which information is given in
the Prospectuses and other than as set forth in the Prospectuses
(exclusive of any amendments or supplements thereto subsequent to
the date of this Agreement), (i) there has not occurred any
material adverse change or any development involving a
prospective material adverse change in the condition, financial
or otherwise, or the earnings, business, management or operations
of the Company and its Subsidiaries, taken as a whole, (ii) there
has not been any material adverse change or any development
involving a prospective material adverse change in the share
capital or in the long-term debt of the Company and its
Subsidiaries, taken as a whole, and (iii) neither the Company nor
any of its Subsidiaries has incurred any liability or obligation,
direct or contingent, which liability or obligation could have a
Material Adverse Effect.
(z) No labor dispute exists with its employees or with employees of
any of the Subsidiaries or is imminent that is reasonably likely
to have a Material Adverse Effect.
(aa) The Company and its Subsidiaries own or have the right to use all
real property and personal property described in the Prospectuses
as being owned or used by them except where the lack of such
ownership or rights would not, individually or in the aggregate,
have a Material Adverse Effect, and there are no liens,
encumbrances or defects with respect to such real property and
personal property, except (i) such as are described in the
Prospectuses, or (ii) for Permitted Liens other than any
Permitted Liens securing Indebtedness.
(bb) The Company and each of its Subsidiaries have filed all tax
returns, if any, which are required to be filed by them pursuant
to domestic or foreign laws and have paid all taxes due pursuant
to such returns or pursuant to any assessment received by them
(except where the requirement for payment of such taxes is being
contested in good faith in appropriate proceedings) except such
failure to file or pay as would not have a Material Adverse
Effect. Except as would not have a
-17-
Material Adverse Effect, the charges, accruals and reserves on
the books of the Company and its Subsidiaries in respect of taxes
or other governmental charges are adequate.
(cc) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions
are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain
accountability for assets; (iii) access to assets is permitted
only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(dd) Any statistical and market-related data included in the
Prospectuses are based on or derived from sources that the
Company believes to be reliable and accurate, and the Company has
obtained the written consent to the use of such data from such
sources to the extent required.
(ee) Neither the Company nor any of its Subsidiaries nor any of their
respective directors, officers, partners, affiliates or
controlling persons has taken, directly or indirectly, any action
designed, or which has constituted or might reasonably be
expected to cause or result, under the Exchange Act or otherwise,
in the stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the
Securities.
(ff) The Company has no reason to believe that the historical
information or the estimates, on the basis of which the reserve
and related information included in the Prospectus was prepared,
was not, in the case of the historical information, true and
correct in all material respects, or in the case of the
estimates, prepared on the basis of reasonable assumptions.
(gg) The Company has filed with the ASC all of the technical reports
required to be filed under Alberta Securities Laws in respect of
each property material to the Company.
(hh) No withholding tax imposed under the federal laws of Canada or
the laws of the Province of Alberta will be payable in respect of
the payment or crediting of the fees contemplated by this
Agreement by the Company to an Underwriter that is not a resident
of Canada for the purposes of the INCOME TAX ACT (Canada), or on
any interest or deemed interest on the resale of Securities by an
Underwriter to U.S. residents provided that the Underwriter deals
at arm's length with the Company (as such term is understood for
purposes of the INCOME TAX ACT (Canada)), and that such fees are
payable in respect of services rendered by the Underwriter wholly
outside of Canada that are performed in the ordinary course of
business carried on by the Underwriter that includes the
performance of such services for a fee.
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(ii) No goods and services tax or sales tax imposed under the federal
laws of Canada or under the laws of the Province of Alberta will
be payable by the Company or collectable by an Underwriter in
respect of the payment of fees as contemplated by this Agreement
to an Underwriter that is not a resident of Canada, provided that
such fees are in respect of services performed by an Underwriter
wholly outside of Canada.
(jj) No stamp duty, documentary taxes or similar taxes are payable by
the Company under the federal laws of Canada or the laws of the
Province of Alberta in connection with the sale and delivery of
the Securities pursuant to this Agreement by the Underwriters or
the resale of Securities by an Underwriter to U.S. residents.
(kk) The Company believes that the historical production information
and the estimates of production and related information included
in the Prospectuses are, in the case of the historical
information, true and correct in all material respects, or in the
case of the estimates, prepared on the basis of reasonable
assumptions.
SECTION 7. INDEMNITY AND CONTRIBUTION.
(a) (i) The Company agrees to indemnify, defend and hold harmless
each Underwriter, its partners, directors and officers, and any
person who controls any Underwriter within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act, and
the successors and assigns of all of the foregoing persons from
and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which, jointly
or severally, any such Underwriter or any such person may incur
under the Securities Act, the Exchange Act, Alberta Securities
Laws, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereof
or the Prospectuses (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto), or
arises out of or is based upon any omission or alleged omission
to state therein a material fact required to be stated in either
such Registration Statement or such Prospectus or necessary to
make the statements made therein not misleading (in the case of
the Registration Statement, or not misleading in light of the
circumstances under which they were made, in the case of such
Prospectus), except insofar as any such loss, damage, expense,
liability or claim arises out of or is based upon any untrue
statement or alleged untrue statement of a material fact
contained in and in conformity with information concerning an
Underwriter furnished in writing by or on behalf of such
Underwriter through the Representative to the Company expressly
for use therein or arises out of or is based upon any omission or
alleged omission to state a material fact in connection with such
information required to be stated in such Registration Statement
or such U.S. Prospectus or Canadian Prospectus or necessary to
make such information not misleading (in the case of the
-19-
Registration Statement, or not misleading in light of the
circumstances under which they were made, in the case of such
Prospectus).
(ii) If any action, suit or proceeding (together, a "PROCEEDING")
is brought against an Underwriter or any such person in respect
of which indemnity may be sought against the Company pursuant to
the foregoing paragraphs, such Underwriter or such person shall
promptly notify the Company in writing of the institution of such
Proceeding and the Company shall assume the defense of such
Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees
and expenses; PROVIDED, HOWEVER, that the omission to so notify
the Company shall not relieve the Company from any liability
which the Company may have to any Underwriter or any such person
or otherwise except to the extent that such failure materially
prejudices the Company's ability to defend such Proceeding. Such
Underwriter or such person shall have the right to employ its or
their own counsel in any such case, but the fees and expenses of
such counsel shall be at the expense of such Underwriter or of
such person unless the employment of such counsel shall have been
authorized in writing by the Company in connection with the
defense of such Proceeding or the Company shall not have, within
a reasonable period of time in light of the circumstances,
employed counsel to have charge of the defense of such Proceeding
or such indemnified party or parties shall have reasonably
concluded, after consulting with counsel, that there may be
defenses available to it or them which are different from,
additional to or in conflict with those available to the Company
(in which case the Company shall not have the right to direct the
defense of such Proceeding on behalf of the indemnified party or
parties), in any of which events such reasonable fees and
expenses shall be borne by the Company and paid as incurred (it
being understood, however, that the Company shall not be liable
for the expenses of more than one separate counsel (in addition
to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction representing the indemnified
parties who are parties to such Proceeding). The Company shall
not be liable for any settlement of any Proceeding effected
without its written consent but if settled with the written
consent of the Company, the Company agrees to indemnify and hold
harmless any Underwriter and any such person from and against any
loss or liability by reason of such settlement. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall
have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the
second sentence of this paragraph, then the indemnifying party
agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such
settlement is entered into more than 90 days after receipt by
such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have reimbursed the indemnified
party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the
indemnifying party at least 45 days' prior notice of its
intention to settle. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any
settlement of any pending or threatened Proceeding in respect of
which any indemnified party is or could have been a party and
indemnity could
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have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of
such Proceeding and does not include an admission of fault,
culpability or a failure to act, by or on behalf of such
indemnified party.
(b) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Company, its directors and officers, and any person
who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, and the
successors and assigns of all of the foregoing persons from and
against any loss, damage, expense, liability or claim (including
the reasonable cost of investigation) which, jointly or
severally, the Company or any such person may incur under the
Securities Act, the Exchange Act, the Alberta Securities Laws,
the common law or otherwise, insofar as, and only to the extent
that, such loss, damage, expense, liability or claim arises out
of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in and in conformity with
information concerning such Underwriter furnished in writing by
or on behalf of such Underwriter through the Representative to
the Company expressly for use in the Registration Statement, the
Prospectuses or any amendments or supplements thereto, or arises
out of or is based upon any omission or alleged omission to state
a material fact in connection with such information required to
be stated in such Registration Statement or such U.S. Prospectus
or Canadian Prospectus or necessary to make such information not
misleading.
It is agreed that the information furnished in writing by or on
behalf of an Underwriter through the Representative to the
Company expressly for use with reference to such Underwriter in
the Registration Statement, the Prospectuses, or any amendments
or supplements thereto is limited to the following: the marketing
names of the Underwriters set forth on the front and back covers
of the U.S. Prospectus and the legal names of the Underwriters
and the statements in the fourth paragraph and the third and
fourth sentences of the seventh paragraph, in each case, set
forth under the heading "Underwriting" in the Prospectuses.
If any Proceeding is brought against the Company or any such
person in respect of which indemnity may be sought against any
Underwriter pursuant to the foregoing paragraph, the Company or
such person shall promptly notify such Underwriter in writing of
the institution of such Proceeding and such Underwriter shall
assume the defense of such Proceeding, including the employment
of counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses; PROVIDED, HOWEVER, that the
omission to so notify such Underwriter shall not relieve such
Underwriter from any liability which such Underwriter may have to
the Company or any such person or otherwise. The Company or such
person shall have the right to employ its own counsel in any such
case, but the fees and expenses of such counsel shall be at the
expense of the Company or such person unless the employment of
such counsel shall have been authorized in writing by such
Underwriter in connection with the defense of such Proceeding or
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such Underwriter shall not have, within a reasonable period of
time in light of the circumstances, employed counsel to defend
such Proceeding or such indemnified party or parties shall have
reasonably concluded, after consulting with counsel, that there
may be defenses available to it or them which are different from
or additional to or in conflict with those available to such
Underwriter (in which case such Underwriter shall not have the
right to direct the defense of such Proceeding on behalf of the
indemnified party or parties, but such Underwriter may employ
counsel and participate in the defense thereof but the reasonable
fees and expenses of such counsel shall be at the expense of such
Underwriter), in any of which events such reasonable fees and
expenses shall be borne by such Underwriter and paid as incurred
(it being understood, however, that such Underwriter shall not be
liable for the expenses of more than one separate counsel (in
addition to any local counsel) in any one Proceeding or series of
related Proceedings in the same jurisdiction representing the
indemnified parties who are parties to such Proceeding). No
Underwriter shall be liable for any settlement of any such
Proceeding effected without the written consent of such
Underwriter but if settled with the written consent of such
Underwriter, such Underwriter agrees to indemnify and hold
harmless the Company and any such person from and against any
loss or liability by reason of such settlement. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall
have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the
second sentence of this paragraph, then the indemnifying party
agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such
settlement is entered into more than 90 days after receipt by
such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have reimbursed the indemnified
party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the
indemnifying party at least 45 days' prior notice of its
intention to settle. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any
settlement of any pending or threatened Proceeding in respect of
which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are
the subject matter of such Proceeding and does not include an
admission of fault, culpability or a failure to act, by or on
behalf of such indemnified party.
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under subsections (a) and (b)
of this Section 7 in respect of any losses, damages, expenses,
liabilities or claims referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other hand from the offering of
the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as
is appropriate to reflect not
-22-
only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of the
Underwriters on the other in connection with the statements or
omissions which resulted in such losses, damages, expenses,
liabilities or claims, as well as any other relevant equitable
considerations. The relative benefits received by the Company on
the one hand and the Underwriters on the other shall be deemed to
be in the same respective proportions as the total proceeds from
the offering (net of underwriting discounts and commissions but
before deducting expenses) received by the Company and the total
underwriting fees received by the Underwriters, bear to the
aggregate public offering price of the Securities. The relative
fault of the Company on the one hand and of the Underwriters on
the other shall be determined by reference to, among other
things, whether the untrue statement or alleged untrue statement
of a material fact or omission or alleged omission relates to
information supplied by the Company or by the Underwriters and
the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses,
damages, expenses, liabilities and claims referred to in this
subsection shall be deemed to include any legal or other fees or
expenses reasonably incurred by such party in connection with
investigating, preparing to defend or defending any Proceeding.
(d) The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable
considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities
underwritten by such Underwriter and distributed to the public
were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by
reason of such untrue statement or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section
7 are several in proportion to their respective underwriting
commitments and not joint.
(e) The indemnity and contribution agreements contained in this
Section 7 and the covenants, warranties and representations of
the Company contained in this Agreement shall remain in full
force and effect regardless of any investigation made by or on
behalf of any Underwriter, its partners, directors or officers or
any person (including each partner, officer or director of such
person) who controls any Underwriter within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange
Act, or by or on behalf of the Company, its directors or officers
or any person who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange
Act, and shall survive any
-23-
termination of this Agreement or the issuance and delivery of the
Securities. The Company and each Underwriter agree promptly to
notify each other of the commencement of any Proceeding against
it and, in the case of the Company, against any of the Company's
officers or directors in connection with the issuance and sale of
the Securities, or in connection with the Registration Statement,
U.S. Prospectus or Canadian Prospectus.
SECTION 8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations
of the Underwriters to purchase the Securities under this Agreement are subject
to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company contained
in this Agreement shall be true and correct on the Closing Date
with the same force and effect as if made on and as of the
Closing Date.
(b) The Prospectus Supplement shall have been filed with the ASC
under the Shelf Procedures within the applicable time period
prescribed for such filing thereunder and the Prospectus
Supplement shall have been filed with the Commission pursuant to
General Instruction II.L of Form F-10 within the applicable time
period prescribed for such filing by the rules and regulations
under the Securities Act and, in each case, in accordance with
Section 5(a) hereof; no stop order suspending the effectiveness
of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been
initiated or, to our knowledge, threatened by the Commission; no
order having the effect of ceasing or suspending the distribution
of the Securities or the trading in the Securities or any other
securities of the Company shall have been issued or proceedings
therefore initiated or, to our knowledge, threatened by any
securities commission, securities regulatory authority or stock
exchange in Canada or the United States; no amendment or
supplement to the Registration Statement or Prospectuses,
including documents deemed to be incorporated by reference
therein, shall have been filed to which the Underwriters
objected; the Registration Statement and all amendments thereto,
or modifications thereof, if any, shall constitute full, true and
plain disclosure of all material facts regarding the Company and
the Securities and shall not contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; the Prospectuses and all amendments or supplements
thereto, or modifications thereof, if any, shall not contain an
untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they are made, not
misleading; and all requests for additional information on the
part of the ASC or the Commission shall have been complied with;
(c) You shall have received on the Closing Date a certificate dated
the Closing Date, signed by any two of the Chief Executive
Officer, the President and the Chief Financial Officer of the
Company, confirming the matters set forth in Sections 8(a), 8(b)
and 8(e) and stating that the Company has complied with all of
the
-24-
agreements and satisfied all of the conditions herein contained
and required to be complied with or satisfied by the Company on
or prior to the Closing Date.
(d) Since the respective dates as of which information is given in
the U.S. Prospectus and the Canadian Prospectus, other than as
set forth in the U.S. Prospectus and the Canadian Prospectus
(exclusive of any amendments or supplements thereto subsequent to
the date of this Agreement), (i) there shall not have occurred
any change or any development involving a prospective change in
the condition, financial or otherwise, or the business,
properties, prospects, financial condition or results of
operations of the Company and its Subsidiaries, taken as a whole,
(ii) there shall not have been any change or any development
involving a prospective change in the share capital or in the
long-term debt of the Company or any of its Subsidiaries and
(iii) neither the Company nor any of its Subsidiaries shall have
incurred any liability or obligation, direct or contingent, the
effect of which, in any such case described in clause 8(d)(i),
8(d)(ii) or 8(d)(iii), in your judgment, is material and adverse
and, in your judgment, acting reasonably, makes it impracticable
to market the Securities on the terms and in the manner
contemplated in the U.S. Prospectus and the Canadian Prospectus.
(e) (i) There shall not have occurred any downgrading, suspension or
withdrawal of, nor shall any notice be given of any potential or
intended downgrading, suspension or withdrawal of, or of any
review (or of any potential or intended review) for a possible
change that does not indicate the direction of the possible
change in, any rating of the Company, the Securities or any other
securities of the Company (including, without limitation, the
placing of any of the foregoing ratings on credit watch with
negative or developing implications or under review with an
uncertain direction) by any "nationally recognized statistical
rating organization" as such term is defined for purposes of Rule
436(g)(2) under the Securities Act, (ii) there shall not have
occurred any negative change, nor shall any notice have been
given of any potential or intended negative change, in the
outlook for any rating of the Company or any securities of the
Company by any such rating organization, and (iii) no such rating
organization shall have given notice that it has assigned (or is
considering assigning) a lower rating to the Securities than that
on which the Securities were marketed.
(f) You shall have received on the Closing Date the following
opinions:
(i) OPINION OF CANADIAN COUNSEL FOR THE COMPANY. The
Underwriters shall have received the favorable opinion dated as
of the Closing Date, of Xxxxxxx Xxxxx LLP, Canadian counsel for
the Company, in form and substance satisfactory to counsel for
the Underwriters.
(ii) OPINION OF SPECIAL UNITED STATES COUNSEL FOR THE
COMPANY. The Underwriters shall have received the favorable
opinion, dated as of the Closing Date, of Torys LLP, special
United States counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters.
-25-
(iii) OPINION OF U.S. COUNSEL FOR THE UNDERWRITERS. The
Underwriters shall have received an opinion, dated as of the
Closing Date, of Xxxxxx Xxxxxx & Xxxxxxx LLP, U.S. counsel for
the Underwriters, in form and substance satisfactory to the
Representative.
(iv) OPINION OF CANADIAN COUNSEL FOR THE UNDERWRITERS. The
Underwriters shall have received an opinion, dated as of the
Closing Date, of Osler, Xxxxxx & Harcourt LLP, Canadian counsel
for the Underwriters, in form and substance satisfactory to the
Representative.
(g) You shall have received, from each of Ernst & Young LLP and PWC
LLP, letters dated the date hereof and from Ernst & Young LLP a
letter dated the Closing Date, in each case, in form and
substance satisfactory to you containing the information and
statements of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial
statements and certain financial information contained in or
incorporated by reference in the Registration Statement and the
Prospectuses, as of a date not more than two business days prior
to the date of the letter.
(h) The Underwriters shall have received a counterpart, conformed as
executed, of the Indenture which shall have been entered into by
the Company and the Trustee.
(i) The Company shall have performed and complied with on or prior to
the Closing Date all of the agreements herein contained and
required to be performed or complied with by the Company, on or
prior to the Closing Date.
(j) On the Closing Date, Newco shall have executed and delivered the
Newco Mirror Note.
(k) On the Closing Date, the Partnership shall have executed and
delivered the Partnership Mirror Note.
(l) On the Closing Date, each Mirror Note Guarantor shall have
executed its Mirror Note Guarantee.
(m) The Representative shall be satisfied that substantially
concurrently with the Closing (after giving effect to the
transactions contemplated hereby), the Company shall execute and
deliver the Paramount Pledge Agreement to the Trustee and the
Company will take all other actions required to ensure that the
Trustee has a first priority perfected security interest in the
Newco Mirror Note and the Company's interest in the Partnership
Mirror Note.
(n) The Representative shall be satisfied that substantially
concurrently with the Closing (after giving effect to the
transactions contemplated hereby), the Company and Newco shall
execute and deliver the Newco Pledge Agreement and the Company
and Newco shall take all other actions required to ensure that
the Company has a first priority perfected security interest in
the Partnership Mirror Note.
-26-
(o) Other than any amendment, waiver or consent delivered on or prior
to the Closing Date, no amendment, waiver or consent is required
under the Company's senior credit facility or its bridge credit
facility in order to allow the issuance and sale of the
Securities under this Agreement.
SECTION 9. EFFECTIVENESS OF THIS AGREEMENT AND TERMINATION. This Agreement
shall become effective upon the execution and delivery of this Agreement by the
parties hereto.
The Underwriters shall have the right to terminate this Agreement
at any time prior to the Closing Date by notice to the Company from the
Representative, without liability on the Underwriters' part to the Company if,
on or prior to such date, (i) the Company or any Subsidiary shall have failed,
refused or been unable to perform in any material respect any agreement on its
part to be performed under this Agreement when and as required, (ii) any
condition to the obligations of the Underwriters under this Agreement to be
fulfilled by the Company or any of its Subsidiaries pursuant to Section 8 is not
fulfilled when and as required, (iii) trading in securities generally on the New
York Stock Exchange, the Nasdaq National Market or the Toronto Stock Exchange
shall have been suspended or materially limited, or minimum prices shall have
been established thereon by the Commission, or by such exchange or other
regulatory body or governmental authority having jurisdiction, (iv) a general
banking moratorium shall have been declared by U.S. federal or New York State,
Canadian federal or Province of Alberta authorities, (v) there is an outbreak or
escalation of hostilities or other national or international calamity, in any
case involving the United States, on or after the date of this Agreement, or if
there has been a declaration by the United States of a national emergency or war
or other national or international calamity or crisis (economic, political,
financial or otherwise) which affects the U.S. and international markets, making
it, in the Representative's judgment, impracticable to proceed with the offering
or delivery of the Securities on the terms and in the manner contemplated in the
Prospectuses or (vi) there shall have been such a material adverse change in
general economic, political or financial conditions or the effect (or potential
effect if the financial markets in the United States have not yet opened) of
international conditions on the financial markets in the United States shall be
such as, in the Representative's judgment, to make it inadvisable or
impracticable to proceed with the offering or delivery of the Securities on the
terms and in the manner contemplated in the Prospectuses.
If, on the Closing Date, any one or more of the Underwriters
shall fail or refuse to purchase Securities that it has or they have agreed to
purchase hereunder on such date, and the aggregate principal amount of
Securities which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase is not more than one-tenth of the aggregate principal
amount of the Securities to be purchased on such date, the other Underwriters
shall be obligated severally in the proportions that the principal amount of
Securities set forth opposite their respective names in SCHEDULE I bears to the
aggregate principal amount of Securities set forth opposite the names of all
such non-defaulting Underwriters, or in such other proportions as you may
specify, to purchase the Securities which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; PROVIDED
that in no event shall the principal amount of Securities that any Underwriter
has agreed to purchase pursuant to this Agreement be increased pursuant to this
Section 9 by an amount in excess of one-ninth of such principal amount of
Securities without the written consent of such Underwriter. If, on the Closing
Date, any Underwriter or Underwriters shall fail or refuse to purchase
Securities and the
-27-
aggregate principal amount of Securities with respect to which such default
occurs is more than one-tenth of the aggregate principal amount of Securities to
be purchased, and arrangements satisfactory to you and the Company for the
purchase of such Securities are not made within 36 hours after such default,
this Agreement shall terminate automatically without liability on the part of
any non-defaulting Underwriter or the Company. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect
of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any
of them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
SECTION 10. CONSENT TO JURISDICTION; APPOINTMENT OF AGENT FOR SERVICE OF
PROCESS. The Company, by its execution and delivery of this Agreement, agrees
that service of process may be made upon Torys LLP in the United States of
America in any suit or proceeding against the Company instituted by the
Underwriters, any indemnified party or by any person, if any, controlling the
Underwriters within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act based on or arising under this Agreement in any federal
or state court in the State of New York, County of New York, and hereby
irrevocably consents and submits to the nonexclusive jurisdiction of any such
court in personam generally and unconditionally in respect of any such suit or
proceeding.
The Company further, by its execution and delivery of this
Agreement, irrevocably designates, appoints and empowers Torys LLP as its
designee, appointee and authorized agent to receive for and on its behalf
service of any and all legal process, summons, notices and documents that may be
served in any action, suit or proceeding brought against the Company with
respect to its obligations, liabilities or any other matter arising out of or in
connection with this Agreement and that may be made on such designee, appointee
and authorized agent in accordance with legal procedures prescribed for such
courts, and it being understood that the designation and appointment of Torys
LLP as such authorized agent shall become effective immediately without any
further action on the part of the Company. The Company further agrees that, to
the extent permitted by law, proper service of process upon Torys LLP at its
office set forth in Section 11 and written notice of said service to the Company
pursuant to this Section 10, shall be deemed in every respect effective service
of process upon the Company in any such suit or proceeding. If for any reason
such designee, appointee and agent hereunder shall cease to be available to act
as such, the Company agrees to designate a new designee, appointee and agent in
The City of New York, New York on the terms and for the purposes of this Section
10 reasonably satisfactory to the Underwriters. The Company further hereby
irrevocably consents and agrees to the service of any and all legal process,
summons, notices and documents in any such action, suit or proceeding against
the Company by serving a copy thereof upon the relevant agent for service of
process referred to in this Section 10 (whether or not the appointment of such
agent shall for any reason prove to be ineffective or such agent
-28-
shall accept or acknowledge such service) and by mailing copies thereof by
registered or certified air mail, postage prepaid, to the Company at its address
specified in or designated pursuant to this Agreement. The Company agrees that
the failure of any such designee, appointee and agent to give any notice of such
service to it shall not impair or affect in any way the validity of such service
or any judgment rendered in any action or proceeding based thereon. Nothing
herein shall in any way be deemed to limit the ability of the Underwriters to
serve any such legal process, summons, notices and documents in any other manner
permitted by applicable law or to obtain jurisdiction over the Company or bring
actions, suits or proceedings against the Company in such other jurisdictions,
and in such manner, as may be permitted by applicable law. The Company hereby
irrevocably and unconditionally waives, to the fullest extent permitted by law,
any objection that it may now or hereafter have to the laying of venue of any of
the aforesaid actions, suits or proceedings arising out of or in connection with
this Agreement brought in the federal courts located in The City of New York,
New York or the courts of the State of New York located in The City of New York,
New York and hereby further irrevocably and unconditionally waives and agrees
not to plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum.
The obligation of the Company in respect of any sum due to the
Underwriters shall, not withstanding any judgment in a currency other than U.S.
dollars, not be discharged until the first business day, following receipt by
the Underwriters of any sum adjudged to be so due in such other currency, on
which (and only to the extent that) the Underwriters may in accordance with
normal banking procedures purchase U.S. dollars with such other currency; if the
U.S. dollars so purchased are less than the sum originally due to the
Underwriters hereunder, the Company agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such Underwriters against such
loss. If the U.S. dollars so purchased are greater than the sum originally due
to such Underwriters hereunder, such Underwriters agree to pay to the Company an
amount equal to the excess of the U.S. dollars so purchased over the sum
originally due to the Underwriters hereunder.
The provisions of this Section 10 shall survive any termination
of this Agreement, in whole or in part.
SECTION 11. MISCELLANEOUS. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company, to Paramount
Resources Ltd., 000 Xxxxx Xxxxxx S.W., Bankers Hall West, Suite 4700, Calgary,
Alberta, Canada T2P 5C2, Attention: X.X. Xxx, Esq. at (000) 000-0000 or by
facsimile to (000) 000-0000, with a copy to Torys LLP, 000 Xxxx Xxxxxx, Xxx
Xxxx, XX 00000-0000, facsimile (000) 000-0000, Attention: Xxxxxx X. Xxxx, Esq.,
and a copy to Xxxxxxx Xxxxx LLP, 3700 Canterra Tower, 000 Xxxxx Xxxxxx, X.X.,
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0, facsimile (000) 000-0000, Attention: Xxxxx
Xxxxxxx, Esq., and (ii) if to the Underwriters, to UBS Securities LLC, 000 Xxxx
Xxxxxx, Xxx Xxxx, XX 00000-0000, Attention: Syndicate Department, with a copy to
Xxxxxx Xxxxxx & Xxxxxxx LLP, 00 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, facsimile (212)
269-5420, Attention: Xxxxxxx Xxxxxx, Esq., and with a copy (for informational
purposes only) to High Yield Syndication Department, UBS Securities LLC, 000
Xxxx Xxxxxx, Xxx Xxxx, XX 00000, facsimile (000) 000-0000, or in any case to
such other address as the person to be notified may have requested in writing.
-29-
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the
Underwriters, the Underwriters' directors and officers, any controlling persons
referred to herein, the Company's directors and the Company's officers who sign
the Registration Statement and their respective successors and assigns, all as
and to the extent provided in this Agreement, and no other person shall acquire
or have any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include a purchaser of any of the Securities from any of the
several Underwriters merely because of such purchase.
This Agreement shall be governed and construed in accordance with
the laws of the State of New York.
This Agreement may be signed in various counterparts which
together shall constitute one and the same instrument.
-30-
Please confirm that the foregoing correctly sets forth the
agreement between the Company and the several Underwriters.
Very truly yours,
PARAMOUNT RESOURCES LTD.
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Chief Executive Officer
By: /s/ Xxxxxxx X. Xxx
---------------------------------
Name: Xxxxxxx X. Xxx
Title: Chief Financial Officer
UBS SECURITIES LLC
Acting for itself and on behalf of the
several Underwriters named in SCHEDULE I
hereto
By: UBS SECURITIES LLC
By: /s/ L. Xxxxx Xxxxxxx
---------------------------------
Name: L. Xxxxx Xxxxxxx
Title: Director,
High Yield Capital Markets
By: /s/ Xxxxxxx X. Xxxxxxx XX
---------------------------------
Name: Xxxxxxx X. Xxxxxxx XX
Title: Executive Director,
High Yield Capital Markets
-31-
SCHEDULE I
PRINCIPAL AMOUNT
UNDERWRITERS OF SECURITIES
------------ -----------------
UBS Securities LLC................................... U.S.$ 56,250,000
Xxxxxx Xxxxxxx Corp.................................. 56,250,000
Scotia Capital (USA) Inc............................. 6,250,000
CIBC World Markets Corp.............................. 6,250,000
-----------------
Total U.S.$ 125,000,000
=================
SCH. I-1
SCHEDULE II
SUBSIDIARIES
PERCENT DIRECTLY OR JURISDICTION OF
SUBSIDIARY INDIRECTLY OWNED INCORPORATION
-----------------------------------------------------------------------------------------
Paramount Resources Partnership 100.00% ALBERTA
Summit Resources Limited 100.00% ALBERTA
Summit Resources, Inc. 100.00% MONTANA
Shehtah Xxxxxx Drilling Partnership 99.00% ALBERTA
910083 Alberta Limited 100.00% ALBERTA
Paramount Resources U.S. LLC 100.00% DELAWARE
Paramount Transmission Ltd. 100.00% FEDERAL (CANADA)
938335 Alberta Ltd. 100.00% ALBERTA
649561 B.C. Ltd. 100.00% BRITISH COLUMBIA
649564 B.C. Ltd. 100.00% BRITISH COLUMBIA
649565 B.C. Ltd. 100.00% BRITISH COLUMBIA
649567 B.C. Ltd. 100.00% XXXXXXX XXXXXXXX
000000 Xxxxxxx Ltd. 100.00% XXXXXXX
000000 Xxxxxxx Ltd. 100.00% ALBERTA
Paramount International Resources Ltd. 100.00% ALBERTA
Paramount Energy Inc. 100.00% ALBERTA
586319 ALBERTA INC. 100.00% ALBERTA
B-1
