EXHIBIT 2.10
DEBENTURE PLEDGE AGREEMENT
DESCRIPTION OF DEBENTURE
PRINCIPAL AMOUNT $3,600,000
DATE SEPTEMBER 18, 1998
INTEREST RATE 8% PER ANNUM
FOR VALUABLE CONSIDERATION, the receipt and sufficiency whereof is
acknowledged by the undersigned, ITC CANADA LIMITED, a body corporate,
incorporated under the laws of Nova Scotia (the "Company"), hereby assigns to,
deposits with and pledges to NOVA SCOTIA BUSINESS DEVELOPMENT CORPORATION
("NSBDC") the debenture created by the Company and described above together with
all renewals thereof, amendments thereto or substitutions therefore, interest
thereon and proceeds thereof (the "Debenture') to be held by NSBDC as general
and continuing collateral security for the payment of all present and future
indebtedness and liability of the Company to NSBDC (the "Indebtedness").
In the event of any default by the Company in payment of any part of the
Indebtedness or in the performance of any other obligation of the Company to
NSBDC, NSBDC may at any time during the continuance of any such default realize
upon the Debenture by sale, transfer or delivery, or exercise and enforce all
rights and remedies of a holder of the Debenture as if NSBDC were absolute owner
thereof, without notice to or control by the Company, and any such remedy may be
exercised separately or in combination and shall be in addition to and not in
substitution for any other rights of NSBDC however created, provided that NSBDC
shall not be bound to exercise any such right or remedy.
The proceeds of the Debenture may be applied by NSBDC on account of such
part of the Indebtedness as it chooses without prejudice to NSBDC's claim upon
the Company for any deficiency.
NSBDC may grant extensions of time or other indulgences, take and give up
securities, accept compositions, grant releases and discharges and otherwise
deal with the Company and with other parties, sureties or securities as NSBDC
may see fit without prejudice to the liability of the Company or NSBDC's rights
in respect of the Debenture.
PROVIDED HOWEVER as follows:
(a) notwithstanding that the Debenture is in the principal amount of
Cdn. $3,600,000 the liability of the Company under the Debenture at
any time shall be limited to the amount of the Indebtedness;
(b) notwithstanding that the Debenture is expressed to be payable on
demand, payment may only be demanded upon the occurrence of an event
of default under any instrument representing the Indebtedness or the
Debenture;
(c) payment to NSBDC of interest for any period in respect of the
Indebtedness, whether before or after default, in accordance with
the terms of the Indebtedness shall be deemed payment in
satisfaction of the interest payment for the same period under the
Debenture.
The Debenture shall not operate by way of merger of any of the
Indebtedness and no judgment recovered by NSBDC shall operate by way of merger
of or in any way affect the security of the Debenture which is in addition to
and not in substitution for any other security now or hereafter held by NSBDC.
This Debenture Pledge Agreement shall be interpreted in accordance with
and governed by the laws of the Province of Nova Scotia and, for such purposes,
the Company hereby irrevocably consents and submits, both as to person and
subject matter, to the jurisdiction of the courts of Nova Scotia and to the
entry of any judgment rendered in any proceedings therein.
The provisions hereof shall be binding upon and shall ensure to the
benefit of the Company and NSBDC and their respective successors and assigns.
IN WITNESS WHEREOF the undersigned has duly executed this instrument as of
the 18th day of September, 1998.
SIGNED, SEALED & DELIVERED ITC CANADA LIMITED
in the presence of:
/s/ Robert G. MacKeigan Per: /s/ Wendy G. Berney
- ------------------------ -------------------------
/s/ Phillip Read
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2
Date: September 18, 1998
====================================================
ITC CANADA LIMITED
and
NOVA SCOTIA BUSINESS
DEVELOPMENT CORPORATION
====================================================
DEBENTURE PLEDGE AGREEMENT
====================================================
Robert G. MacKeigan
Cox Hanson O'Reilly Matheson
Barristers and Solicitors
Suite 1100, Purdy's Wharf Tower One
1959 Upper Water Streest
PO Box 2380, Stn Central RPO
Halifax NS B3J 3E5