1
EXHIBIT (10g)
SHAREHOLDERS AGREEMENT
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MEMORANDUM OF AGREEMENT made as of the 17th day of April, 1997.
BETWEEN:
3357392 CANADA INC., a corporation incorporated pursuant to the
laws of Canada,
(hereinafter referred to as "CANCO 1"),
OF THE FIRST PART,
-and-
The individuals and trusts listed on Schedule A hereto, (subject
to the further definition below, such individuals and trusts being
hereinafter collectively referred to as "IMPARK MANAGEMENT" and
individually as a "MEMBER OF IMPARK MANAGEMENT"),
OF THE SECOND PART,
-and
3355489 CANADA INC.,
a corporation incorporated pursuant to the laws of Canada,
(hereinafter referred to as "FUMI HOLDINGS"),
OF THE THIRD PART.
WHEREAS the individuals listed in Schedule A are employed in the
management of Impark (as hereinafter defined);
AND WHEREAS those members of Impark Management listed in Schedule
A (the "Holdco Shareholders") are the holders of those shares and options to
purchase shares as listed in Schedule A of Imperial Holdings No. 2 Inc.
("Holdco"), which owns all of the shares of Imperial Parking Limited;
AND WHEREAS First Union Real Estate Equity and Mortgage
Investments ("FUR"), an Ohio business trust, has entered into a share purchase
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agreement dated February 18, 1997 as amended by amending agreements made as of
February 26, 1997, March 2, 1997, March 7, 1997, March 17, 1997 and April 15,
1997 (the "Share Purchase Agreement") with Impark Investments Inc., the Holdco
Shareholders and certain other individuals providing for the sale and purchase
of all of the shares of Holdco;
AND WHEREAS Canco 1 has arranged to obtain an assignment of all of
the rights of FUR under the Share Purchase Agreement;
AND WHEREAS, at the date hereof, Canco 1 is a wholly-owned
subsidiary of FUMI Holdings;
AND WHEREAS, as a result of the completion of the Share Purchase
Agreement, the Holdco Shareholders will become holders of shares of Canco 1;
AND WHEREAS the Holdco Shareholders wish to maximize the interest
in Canco 1 which they acquire as a result of the sale and purchase of shares
provided for under the Share Purchase Agreement;
AND WHEREAS the members of Impark Management who are not Holdco
Shareholders wish to become shareholders of Canco 1;
AND WHEREAS the parties to this agreement wish to establish their
respective rights and obligations in respect of the shares of Canco 1 which the
members of Impark Management will acquire;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of
the premises and of the respective covenants and agreements herein contained and
for other good and valuable consideration (the receipt and sufficiency of which
are hereby acknowledged by each of the parties), the parties covenant and agree
as follows:
ARTICLE 1
INTERPRETATION
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1.1 CERTAIN DEFINITIONS. Where used in this agreement, unless there
is something in the context or the subject matter inconsistent therewith, the
following terms shall have the following meanings:
"ADDITIONAL PARKING FACILITIES" means any parking facilities
(other than the Cleveland Parking Facilities and the Transferred
Parking Facilities) which are acquired by FUR after April 17, 1997
whether by direct purchase or by acquisition of an entity owning
such parking facilities;
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"ADJUSTED OPERATING INCOME" for any period means the Facilities
Operating Income for such period minus the Facilities Return to
FUR for such period;
"AFFILIATE", in relation to an individual, means a corporation
that is controlled by such individual and all of the shares of
which are owned by such individual and/or such individual's spouse
and/or children or a trust of which such individual and/or such
individual's spouse and/or children are the sole beneficiaries;
"BASE INDEBTEDNESS" means the amount as of the close of business
on April 17, 1997 of the combined indebtedness (excluding
indebtedness incurred for normal working capital purposes
including without limitation operating lines of credit) of Canco
1, the Corporation, 504308 N.B. Inc. and 504463 N.B.
Inc., which is expected to be approximately $77,500,000;
"BOARD" means the board of directors of Canco 1;
"BUSINESS DAY" means any day which is not a Saturday, a Sunday or
a statutory holiday in Ontario or British Columbia;
"CLEVELAND PARKING FACILITIES" means the Huntington garage, the
West Third Street surface parking lot and the 55 Public Square
garage, all in the City of Cleveland, Ohio;
"CLASS A COMMON SHARES" means the Class A non-voting common shares
in the capital of Canco 1, any securities into which such common
shares may be converted, exchanged, reclassified, redesignated,
subdivided or otherwise changed from time to time and any
securities of any successor corporation or a corporation
continuing from Canco 1 into which such common shares or such
other securities may be changed as a result of any amalgamation,
merger, consolidation, plan of arrangement or reorganization,
statutory or otherwise;
"CLASS B COMMON SHARES" means the Class B voting common shares in
the capital of Canco 1, any securities into which such common
shares may be converted, exchanged, reclassified, redesignated,
subdivided or otherwise changed from time to time and any
securities of any successor corporation or a corporation
continuing from Canco 1 into which such common shares or such
other securities may be changed as a result of any amalgamation,
merger, consolidation, plan of arrangement or reorganization,
statutory or otherwise;
"COMMON SHARES" means Class A Common Shares and Class B Common
Shares;
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"CONSOLIDATED PERFORMANCE" for any period means the total of the
Impark EBITDA and the Adjusted Operating Income for such period;
"CORPORATION" means Imperial Parking Limited or any successor
thereto;
"DATE OF CLOSING" and "TIME OF CLOSING" have the respective
meanings ascribed thereto in Articles 5 and 6, as the case may be;
"DEPOSITARY" has the meaning ascribed thereto in section 9.1;
"DESIGNATED REPRESENTATIVE" means the Designated Representative as
determined at the relevant time in accordance with section 3.1;
"DISABILITY" means the inability of a member of Impark Management
to continue to perform his duties for Impark on a full-time basis
for a period of more than six (6) months as a result of physical
or mental disability, as determined by a qualified medical
practitioner;
"EFFECTIVE DATE" has the meaning ascribed thereto in sections 6.1,
6.2, 6.3 and 7.2;
"FACILITIES OPERATING INCOME" for a period means, without double
counting, the actual revenues realized by Impark during such
period from the operation of First Union Facilities less all
expenses associated with operating the First Union Facilities
(other than real estate taxes, utilities, ground rent and
insurance covering damage to the physical facility) incurred by
Impark during such period in operating the First Union Facilities
(but for greater certainty not deducting any amounts payable to
FUR pursuant to any lease or management agreement and not
deducting any interest expense);
"FACILITIES RETURN TO FUR" for any period means an amount of
imputed interest calculated at the rate of 11% per annum on the
amount of any outstanding FUR Capital Expenditure;
"FAIR VALUE PER SHARE" as at any date means:
(i) in the case of Preferred Shares, the Redemption Amount of a
Preferred Share as at such date determined in accordance
with the articles of Canco 1 but without regard to the fact
that the Preferred Shares are not redeemable prior to April
1, 2002; and
(ii) in the case of Common Shares, the amount determined by
dividing the Management Enterprise Equity Value as at the
end of the immediately preceding calendar year by
1,322,140;
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"FIRST UNION FACILITIES" means the Cleveland Parking Facilities,
the Transferred Parking Facilities and Additional Parking
Facilities which are leased to or managed by Impark;
"FUMI" mean First Union Management, Inc., a Delaware corporation;
"FUMI HOLDINGS PROPORTION" has the meaning ascribed thereto in
section 5.1;
"FUR CAPITAL EXPENDITURE" means the following:
(i) the amount of the gross acquisition cost to FUR (including
purchase price, fees, commissions and out-of-pocket
expenses of acquisition) of Additional Parking Facilities,
and such FUR Capital Expenditures shall be deemed to be
outstanding during any period while such Additional Parking
Facilities constitute First Union Facilities; and
(ii) the amount expended directly or indirectly by FUR to make
capital improvements to any First Union Facilities on
Impark's recommendation for the purpose of increasing the
Facilities Operating Income, and such FUR Capital
Expenditures shall be deemed to be outstanding from the
date any such amount is so expended and for so long as such
parking facilities constitute First Union Facilities;
"IMPARK" means collectively the Corporation and 504463 N.B. Inc.
and any direct or indirect subsidiaries of either of them;
"IMPARK EBITDA" for any period means the consolidated earnings of
Impark before interest expense (or interest income), income taxes,
depreciation and amortization, as calculated in accordance with
generally accepted accounting principles as used in the December
31, 1996 audited financial statements of the Corporation,
consistently applied, adjusted as follows:
(a) deducting any revenues or expenses of any type related to
First Union Facilities for such period; and
(b) deducting an amount on account of imputed interest
calculated at the rate of 8% per annum on any indebtedness
(excluding indebtedness incurred for normal working capital
purposes including without limitation operating lines of
credit) of Impark which is outstanding at any time during
such period in any amount in excess of the Base
Indebtedness;
"IMPARK MANAGEMENT" means the individuals listed on Schedule A
hereto and any other employee of Impark who hereafter becomes a
party to this agreement and any legal personal representative of
any such individual who
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dies or becomes mentally incapacitated (the foregoing being
"individual members"), and includes any Affiliate of any
individual member of Impark Management which holds Shares or to
which Shares are transferred or any successor or assign of such
Affiliate and also includes individuals to whom Shares are
transferred in accordance with the provisions of sections 4.3 and
4.5; and reference herein to the "members" or a "member" means
members or a member of Impark Management;
"MANAGEMENT ENTERPRISE EQUITY VALUE" as at the end of any calendar
year means the amount obtained by multiplying $5,555,556 by the
Proportionate Change as at such year end and deducting $4,233,416
from such product;
"PERFORMANCE SHORTFALL" for any period means the amount, if any,
by which the Performance Target for such period exceeds the
Consolidated Performance for such period, provided that if such
Consolidated Performance exceeds such Performance Target the
Performance Shortfall shall be zero;
"PERFORMANCE TARGET" means $13,146,105 for the 1997 calendar year,
$14,340,350 for the 1998 calendar year, $14,895,964 for the 1999
calendar year, and $15,473,803 for the 2000 calendar year, subject
in each case to the provisions of section 3.5;
"PERSON" includes an individual, a trust, a firm, a corporation, a
syndicate, a partnership, an association, a joint venture and
every other legal or business entity whatsoever;
"PREFERRED SHARES" means the Class A Preferred Shares in the
capital of Canco 1, any securities into which such Class A
Preferred Shares may be converted, exchanged, reclassified,
redesignated, subdivided or otherwise changed from time to time
and any securities of any successor corporation or a corporation
continuing from Canco 1 into which such Class A Preferred Shares
or such other securities may be changed as a result of any
amalgamation, merger, consolidation, plan of arrangement or
reorganization, statutory or otherwise;
"PROPORTIONATE CHANGE" as at the end of a calendar year means (i)
one as at the end of 1996, and (ii) other than as at the end of
1996, the Consolidated Performance for such calendar year divided
by the Performance Target for 1997;
"PURCHASE PRICE" means the purchase price for any Purchased Shares
pursuant to any transaction of purchase and sale of Shares
provided for in this agreement;
"PURCHASED SHARES" means, in the context of any provision hereof
pursuant to which a Vendor is selling Shares, such Shares;
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"PURCHASER" means, in the context of any provision hereof pursuant
to which a Vendor is selling Shares, the purchaser of such Shares;
"SHARE PURCHASE CLOSING" means the completion of the sale and
purchase of shares of Holdco pursuant to the Share Purchase
Agreement;
"SHARES" means Class A Common Shares, Class B Common Shares and
Preferred Shares;
"SPOUSE" has the meaning ascribed thereto in Part I of the Family
Law Act (Ontario);
"THIRD PARTY" means, as applicable to sections 5.1 and 6.4, a
person dealing at arm's length (within the meaning of the Income
Tax Act (Canada)) with Canco 1, and for greater certainty, in all
cases, neither (i) any individual who is a full time member of the
management of FUR or FUMI or any of their respective affiliates,
or any corporation wholly-owned, directly or indirectly, by any
such individual or a trust related to any such individual, nor
(ii) any person that is a firm, corporation, syndicate,
partnership, association, joint venture or other legal or business
entity whatsoever which is controlled by FUR or FUMI, shall be
deemed to be a Third Party;
"THIRD PARTY OFFER" has the meaning ascribed thereto in section
5.1; and
"TRANSFERRED PARKING FACILITIES" means 633 - 10th Avenue S.W.,
Calgary, Alberta; 1009 A, B and C - 9th Avenue S.W., Calgary,
Alberta; 10040 - 103 Street, Edmonton, Alberta; 10244 - 103
Street, Edmonton Alberta; 10239 - 107 Street, Edmonton, Alberta;
1709 Blanshard Street, Victoria, B.C.; 245 Graham Avenue and 257
Smith Street, Winnipeg, Manitoba; 168 Water Avenue, Winnipeg,
Manitoba; 336 Young Street, Winnipeg, Manitoba; 296, 298 and 304
Broadway, Winnipeg, Manitoba; 115 Donald Street, Winnipeg,
Manitoba; 178 Queen's Quay East, Toronto, Ontario; and 1724 Broad
Street, Regina, Saskatchewan; and
"VENDOR" means, in the context of any provision hereof pursuant to
which Shares are being sold, the shareholder selling such Shares.
1.2 OTHER RULES OF INTERPRETATION. All words used in this agreement shall be
read with such changes in gender and number as are required by the context.
Words importing the singular number shall include the plural and vice versa and
words importing gender shall include all genders. The terms "this agreement",
"hereof", "herein", "hereunder" and similar expressions refer to this agreement
and not to any particular Article, section or paragraph or other portion hereof
and
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include any agreement, schedule, amendment or other instrument supplementary or
ancillary hereto. Time is of the essence hereof.
1.3 CURRENCY. All dollar amounts stated herein are, unless otherwise indicated,
in Canadian dollars.
1.4 HEADINGS AND REFERENCES. The division of this agreement into Articles,
sections and paragraphs and the insertion of headings are for convenience of
reference only and shall not affect the construction or interpretation of this
agreement. Reference in this agreement to an Article, section or Schedule is to
the applicable Article, section or Schedule of this agreement unless the context
otherwise requires.
1.5 REFERENCE TO STATUTES. Reference in this agreement to a statute means such
statute as amended, re-enacted or replaced from time to time and includes all
regulations promulgated thereunder.
ARTICLE 2
SUBSCRIPTION AND SHARE PURCHASE CLOSING
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2.1 EXERCISE OF OPTION. Each Holdco Shareholder already has exercised or shall,
prior to the Share Purchase Closing, exercise all options to purchase shares of
Holdco held by such Holdco Shareholder as set out in Schedule A so that, at the
time of the Share Purchase Closing, each Holdco Shareholder will be the holder
of that number of shares of Holdco indicated on Schedule B.
2.2 ALTERATION OF CONSIDERATION. Notwithstanding the provisions of section 2.3
of the Share Purchase Agreement, the portion of the purchase price for the
shares of Holdco to be received on the Share Purchase Closing by each Holdco
Shareholder shall be satisfied by the payment and delivery by Canco 1 of cash
and Shares as set out in Schedule B. Without limiting the generality of section
4.6, all certificates for Shares issued to Holdco Shareholders on the Share
Purchase Closing shall bear the legend provided for in section 4.6.
2.3 TAX ELECTIONS. Notwithstanding the provisions of section 2.14 of the Share
Purchase Agreement, if requested by a Holdco Shareholder, Canco 1 will file a
joint election pursuant to subsection 85(1) of the Income Tax Act (Canada) (the
"Tax Act") in the prescribed form and within the prescribed time so that the
proceeds of disposition of the shares of Holdco for the purposes of the Tax Act
shall be deemed to be the amount elected in such election, as determined by the
Holdco Shareholder, within the limits provided for in the Tax Act.
2.4 SUBSCRIPTION. Each person named in Schedule C hereby subscribes for and
agrees to take up the number and class of Shares set out opposite such person's
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name in such Schedule and to pay therefor the subscription price of $1.00 per
Share, such subscription to be made and to become effective immediately
following the proposed amalgamation of Canco 1 and the Corporation as referred
to in section 3.3. Canco 1 agrees to accept such subscription by each such
person.
2.5 REPRESENTATION REGARDING RRSP'S. Each of J. Bruce Newsome, Douglas I.
Poirier, J. Robin Bateman, Robert L. Noiles, Henry J. Renaud and Stuart M.
MacKenzie represents and warrants with respect to his respective Affiliate which
is a Holdco Shareholder that: (i) at the time of closing under the Share
Purchase Agreement, such Affiliate will be the registered owner of that number
of shares of Holdco as listed opposite the name of such Affiliate in Schedule A,
with good and marketable title thereto free and clear of all liens, charges and
encumbrances; (ii) except pursuant to the Share Purchase Agreement, no person
has any option, contract or agreement, or any right or privilege capable of
becoming an option, contract or agreement, for the purchase or acquisition of
any of the shares of Holdco or any Shares to be acquired pursuant hereto; (iii)
the trustee under such Affiliate has all necessary power and authority to enter
into this agreement and to perform its obligations hereunder; and (iv) this
agreement has been duly executed and delivered by such Affiliate and is a legal,
valid and binding obligation of such Affiliate, enforceable against such
Affiliate in accordance with its terms.
ARTICLE 3
VOTING, ORGANIZATION AND MANAGEMENT
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3.1 DESIGNATED REPRESENTATIVE. The representative from time to time of the
members of Impark Management (the "Designated Representative") shall be the
Chief Executive Officer of the Corporation then in office who shall have the
irrevocable and full authority to give and receive all notices, communicate all
decisions and otherwise take all actions that are to be given, made or taken
pursuant to this agreement by Impark Management and the parties hereto shall be
entitled to rely upon the authority of the Designated Representative to bind
Impark Management in respect of all matters arising pursuant to this agreement.
3.2 ASSIGNMENT OF VOTING RIGHTS. Each member of Impark Management does hereby
irrevocably nominate, constitute and appoint the Designated Representative as
his true and lawful attorney with authority to vote any and all of the Shares
held from time to time by such member, and to execute resolutions in writing of
the shareholders of Canco 1 as holders of such Shares for and on behalf of and
in the name of such member, in such manner as may be determined by the
Designated Representative in his sole discretion, at all times and on all
matters that may come before the shareholders of Canco 1 or any class thereof
while this agreement remains in effect and to make, execute, seal and deliver
for and on behalf of and in the name of such member of Impark Management, one or
more proxies in respect of Shares held by such member of Impark Management from
time to time.
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The members of Impark Management shall each deliver to the current Designated
Representative, concurrently with the execution of this agreement and from time
to time thereafter upon request therefor, a continuing power of attorney in the
form attached hereto as Schedule D in favour of the Designated Representative
for the purposes of this section 3.2 and Article 8, which power of attorney
shall not be revocable by the member without the consent of FUMI Holdings and
which, being coupled with an interest, shall not be revoked by the insolvency,
bankruptcy or incapacity of the member or of any Affiliate of the member to
which Shares may be transferred in accordance with section 4.2. Each member of
Impark Management hereby ratifies and confirms and agrees to ratify and confirm
all that such attorney may lawfully do or cause to be done by virtue of the
authority hereby or thereby conferred. Upon any change in the Designated
Representative, the former Designated Representative and all members of Impark
Management shall forthwith agree to the revocation of all such powers of
attorney and new powers of attorney shall be forthwith provided in favour of the
new Designated Representative.
3.3 AMALGAMATION OF CANCO 1. Forthwith following the Share Purchase Closing,
Holdco shall be wound-up into Canco 1 and then Canco 1 and the Corporation shall
be amalgamated pursuant to a short form vertical amalgamation under the Canada
Business Corporations Act. Following such amalgamation, all references in this
agreement to Canco 1 and the Corporation shall be deemed to be references to the
continuing corporation formed as a result of the amalgamation of such two
corporations.
3.4 BOARD OF DIRECTORS. The Board shall consist of three members. One member of
the Board shall be the nominee of the Designated Representative and the other
two members of the Board shall be nominees of FUMI Holdings.
3.5 ADJUSTMENT OF PERFORMANCE TARGETS AND CONSOLIDATED ACHIEVEMENT.
Notwithstanding the definition of Performance Targets and the definition of
Consolidated Performance and the definitions related thereto, the amounts
otherwise provided for or determined in accordance with any of such definitions
shall be subject to adjustment in the discretion of the Board to be exercised in
good faith and after consultation with the Designated Representative and the
auditors of Canco 1 in the event of material asset dispositions or in the event
of unusual circumstances which would lead to anomalous or inappropriate results
and to offset the effect of any office rent paid by Impark to FUR on the First
Union Facilities.
3.6 PERFORMANCE ACHIEVEMENT PROGRAM. The Corporation shall establish and
implement a performance achievement program for the benefit of Impark Management
on the terms set forth in Schedule E.
3.7 PERFORMANCE BONUS PROGRAM. The Corporation shall establish and implement a
performance bonus program for the benefit of, inter alia, Impark Management on
the terms set forth in Schedule F.
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3.8 ADDITIONAL ISSUANCE OF COMMON SHARES. If after the date hereof Canco 1
proposes to issue from treasury any additional Class A Common Shares or Class B
Common Shares, Canco 1 shall first offer such Common Shares to the parties
hereto (the "Eligible Shareholders") who then hold Common Shares of the class of
Common Shares proposed to be issued (the "Offered Class") by notice given to the
Eligible Shareholders of the intention of Canco 1 and the number and class of
additional Common Shares proposed to be issued. Each Eligible Shareholder shall
have the right to purchase his pro rata portion of the Common Shares so offered
with such pro rata portion to be determined based on the number of Common Shares
of the Offered Class owned by such Eligible Shareholder at the date such notice
is given relative to the total outstanding number of Common Shares of the
Offered Class as at such date. Each Eligible Shareholder shall have 20 Business
Days from the date such notice is given to agree to take up and pay for the
Common Shares so offered. Any Common Shares that the Eligible Shareholders have
not agreed to take up and pay for within such 20 Business Days may be issued at
any time within the ensuing 60 days to such persons as the Board in its
discretion determines on terms not more favourable to the purchaser than the
terms offered to the Eligible Shareholders.
ARTICLE 4
GENERAL RESTRICTIONS ON TRANSFERS
---------------------------------
4.1 GENERAL RESTRICTION. Except as specifically provided in sections 4.2, 4.3
and 4.4 and Articles 5, 6 and 7, no member of Impark Management may, except with
the prior written consent of FUMI Holdings, which consent may be withheld in its
sole discretion, sell, transfer (including by operation of law, by winding-up or
by amalgamation and whether or not for consideration), assign or otherwise
dispose of (any of the foregoing being a "sale") or mortgage, charge, encumber,
pledge, assign by way of security or grant a security interest in (any of the
foregoing being a "pledge") its rights, title or interest in, to or under any
Shares to any person other than FUMI Holdings. Any sale or pledge attempted to
be made which is not in accordance with this agreement shall be void and of no
effect and Canco 1 shall not accept any such sale or pledge or any transfer by
any person claiming rights through any such sale or pledge for registration on
its books of record.
4.2 TRANSFERS TO AFFILIATES. Subject to the provisions of the articles of Canco
1 and sections 4.5 and 4.6 and Article 6 of this agreement, nothing herein shall
prevent the transfer of any Shares or any interests therein by any of the
individual members of Impark Management to an Affiliate of such member or by an
Affiliate of such individual member to another Affiliate of such individual
member provided that: (i) the Affiliate executes and delivers a document
agreeing to be bound by the provisions hereof pursuant to section 4.5 and such
other instruments as FUMI Holdings may reasonably request to ensure that such
Affiliate continues to
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qualify as an Affiliate of such member; (ii) each of the Affiliate and such
individual member agrees with Canco 1 and FUMI Holdings not to effect or agree
to effect any sale or pledge of any securities of such Affiliate without the
prior written consent of FUMI Holdings, such consent not to be unreasonably
withheld; and (iii) such individual member shall remain liable under this
agreement as a guarantor to ensure that the Affiliate, or any further Affiliate
to which such Shares may be transferred, abides by the terms of this agreement.
4.3 PERMITTED TRANSFERS. Any member of Impark Management may sell all or any
portion of such member's or such member's Affiliate's Shares to:
(i) with the prior written consent of the Designated Representative,
any other member of Impark Management or any person who has been
an employee of Impark continuously since April 17, 1997; or
(ii) with the prior written consent of FUMI Holdings, such consent not
to be unreasonably withheld, any other full-time employee of
Impark, provided that such purchaser shall, as a condition
precedent to such purchase and sale, execute an agreement as
required by section 4.5 and such purchaser shall thereupon become
a member of Impark Management for the purposes of this agreement.
4.4 PERMITTED PLEDGES. Any member of Impark Management may, with the prior
written consent of FUMI Holdings, such consent not to be unreasonably withheld,
pledge all or any portion of such member's or such member's Affiliate's Shares
to a recognized Canadian financial institution solely to secure bonafide
indebtedness or financial obligations of such member or Affiliate to such
financial institution for an amount not exceeding two-thirds (2/3) of the
original issue price of the Shares held by such member and such member's
Affiliate and solely for the purpose of such member or Affiliate acquiring such
Shares, provided that: (i) such financial institution acknowledges in writing,
on terms acceptable to FUMI Holdings, to be bound by the terms and provisions of
this agreement in dealing with such Shares to the same extent as if it were a
member of Impark Management; (ii) such financial institution agrees to notify
the Designated Representative and FUMI Holdings of any default by a member of
Impark Management with respect to such indebtedness or financial obligations and
to grant the Designated Representative and FUMI Holdings the option to purchase
such member's Shares in accordance with section 6.2; (iii) such financial
institution agrees, in the event of a sale, realization or other disposition of
all or any portion of such Shares, that the same shall only be dealt with
subject to and in accordance with the terms and provisions of this agreement;
and (iv) such financial institution agrees that upon repayment of such
indebtedness or financial obligations it will deliver the certificates
representing such member's Shares to the Depositary and not to such member.
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4.5 AGREEMENT BINDING. If any Shares or any interests therein are transferred,
issued or sold to any person who is not an original party to this agreement, as
a condition precedent to being registered as a holder of Shares and to the
exercise or enjoyment by such acquiror of any rights attaching to such Shares,
the acquiror of such Shares shall execute and deliver an agreement, in form and
on terms satisfactory to FUMI Holdings, whereby such acquiror agrees to be bound
by the provisions hereof, with such amendments hereto and thereto as may be
required by FUMI Holdings, as if he were an original party hereto, and such
acquiror shall thereupon become a member of Impark Management (for purposes only
of this agreement but not for the purposes of the program described in Schedule
E) and shall have the same rights, and be subject to the same obligations and
restrictions, hereunder as the other members of Impark Management or the
original party hereto previously holding such Shares. In the case of a sale of
all of the Shares of an original party other than to an Affiliate thereof, the
obligations hereunder of such original party as a holder of Shares shall
thereupon cease to be effective and such member shall cease to be entitled to
any benefits hereunder in respect of such Shares arising after the time of such
sale, subject to the continuing liability under section 4.2 in respect of
transfers to Affiliates and provided that the foregoing shall not release or
affect any rights or obligations arising prior to such time hereunder in respect
of such Shares. For greater certainty, if such a transferee is already a member,
his rights and obligations as a member hereunder shall thereupon apply to the
Shares thus sold to him in the same manner as to his original Shares (provided
that such transferee shall not thereby acquire any additional rights for the
purposes of the program described in Schedule E).
4.6 LEGENDS ON SHARE CERTIFICATES. Any and all certificates representing Shares
now or hereafter issued to any person during the term of this agreement (whether
such certificates are issued at present or subsequently issued or sold) shall
have typed or otherwise written thereon a legend substantially to the following
effect:
"The shares represented by this certificate are subject to
certain restrictions on the right to transfer, sell, assign or
otherwise deal with them, pursuant to a shareholders'
agreement made as of the 17th day of April, 1997, and notice
of the terms and conditions of such agreement is hereby
given."
ARTICLE 5
THIRD PARTY OFFERS
------------------
5.1 DRAG ALONG. If at any time FUMI Holdings proposes to sell any of its Common
Shares pursuant to a bonafide offer by, or letter of intent of, a Third Party (a
"Third Party Offer"), FUMI Holdings shall deliver a notice in writing to the
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members of Impark Management setting out the price per Common Share of the Third
Party Offer (the "Offer Price") (which shall be the same for both Class A Common
Shares and Class B Common Shares) and the other relevant material terms and
conditions (the "Offer Terms") of the Third Party Offer and the number of Common
Shares that FUMI Holdings intends to sell pursuant to the Third Party Offer and
the proportion of the Common Shares held by FUMI Holdings that such number then
constitutes (the "FUMI Holdings Proportion"). FUMI Holdings may, at its option,
specify in such notice that the members of Impark Management shall be required
to sell to the Third Party, at the Offer Price and on the Offer Terms, that
proportion of their Common Shares that is equal to the FUMI Holdings Proportion,
and, if FUMI Holdings so states in such notice, the members of Impark Management
shall sell their Common Shares to the Third Party at the Offer Price and on the
Offer Terms.
5.2 TAG ALONG. If FUMI Holdings does not require the members of Impark
Management to sell their Common Shares pursuant to section 5.1, then each of the
members of Impark Management may, by notice in writing delivered to FUMI
Holdings at any time within ten (10) days following the delivery of the notice
by FUMI Holdings to such members pursuant to section 5.1, elect either of the
following alternatives:
(a) to sell that proportion of such member's Common Shares that is
equal to the FUMI Holdings Proportion at the Offer Price and
on the Offer Terms, in which case FUMI Holdings shall cause
the Third Party to purchase, and such member shall sell, such
member's Common Shares to the Third Party; or
(b) not to sell any Common Shares held by such member pursuant to
this section 5.2, in which case FUMI Holdings may proceed to
sell the Common Shares indicated in the FUMI Holdings' notice
described above in section 5.1 to the Third Party pursuant to
the Third Party Offer at the Offer Price and on the Offer
Terms.
5.3 PREFERRED SHARES. In the event that as a result of any Third Party Offer all
of the Common Shares held by any member of Impark Management are to be sold by
such member, FUMI Holdings shall cause all of the Preferred Shares held by such
member of Impark Management either to be redeemed by Canco 1 or to be acquired
by some other person for a price equal to the then current redemption price of
such Preferred Shares, in either event immediately prior to or contemporaneously
with the sale of the Common Shares.
5.4 REPRESENTATIONS AND WARRANTIES. In connection with any sale of Common Shares
in accordance with this Article 5, FUMI Holdings may require the members of
Impark Management to enter into agreements with FUMI Holdings and/or the Third
Party in which such members shall represent and warrant that,
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except as specifically disclosed to FUMI Holdings or the Third Party in writing,
such member at the time of closing of such sale does not have actual knowledge
that any warranty made by FUMI Holdings pursuant to a written sale agreement, a
copy of which was provided to such member, in connection with such sale was
untrue in any material respect as of the closing of such sale, provided that no
such member need make any independent enquiry or investigation in connection
with giving such representation and warranty. The liability of such member for
any inaccuracy in such representation and warranty shall be limited to the
amount which he receives from the sale of his Shares in connection with such
sale and shall be pro rata in accordance with the number of Shares sold by such
member in relation to the total number of shares sold to the Third Party.
5.5 CLOSING OF THIRD PARTY PURCHASES. Any purchase and sale of Common Shares
pursuant to this Article 5 shall be effected concurrently with the sale of
Common Shares by FUMI Holdings to the Third Party in accordance with the
provisions of Article 8 and shall be completed at the date and time (the "Date
of Closing" and "Time of Closing", respectively, for purposes of Article 8)
specified by FUMI Holdings or the Third Party by notice in writing delivered to
the member not later than ten (10) days following the date on which the
obligations of such member to sell Common Shares have arisen pursuant to this
Article 5, and in any event the Date of Closing shall be no later than ninety
(90) days following the date of the Third Party Offer.
ARTICLE 6
DEATH, DISABILITY,
TERMINATION, RESIGNATION AND DEFAULT
------------------------------------
6.1 OPTION TO PURCHASE. If at any time any individual member of Impark
Management has ceased to be employed by Impark or by an affiliate of Impark for
any reason (including, without limitation, by reason of voluntary resignation,
termination with or without cause, death or Disability), the following rights
shall arise with respect to the Shares held by such individual member of Impark
Management and by any Affiliate of such individual member (the "Subject
Shares"):
(a) the Designated Representative shall have the right, at his option,
to purchase for cash all but not less than all of the Subject
Shares, which option may be exercised by notice in writing to such
individual member of Impark Management or the executors or legal
personal representatives of an individual member who has died or
become mentally incapacitated or the permitted successors and
assigns of an Affiliate of that member (the "Selling Manager") and
to FUMI Holdings given at any time within 30 days following the
date (the Effective Date") which is the effective date of the
resignation, the date
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of giving of notice of termination or the date of death or
Disability, as the case may be;
(b) if the Designated Representative does not exercise his option as
set forth in subsection (a) above within 30 days following the
Effective Date or gives notice to the Selling Manager and FUMI
Holdings that he does not wish to exercise such option, FUMI
Holdings shall have the right, at its option, to purchase for cash
all but not less than all of the Subject Shares, which option may
be exercised by notice in writing to the Selling Manager given at
any time after 30 days following the Effective Date; and
(c) if the Designated Representatives does not exercise his option as
set forth in subsection (a) above and FUMI Holdings does not
exercise its option as set forth in subsection (b) above, the
Selling Manager shall have the right, at his option, to sell all
of his Common Shares to Canco 1 with the price therefor to be
payable by the issuance of additional Preferred Shares at $1 per
Preferred Share, which option may be exercised by the Selling
Manager giving notice to Canco 1 and FUMI Holdings at any time
after 40 days but before 60 days following the Effective Date and,
in the event of the exercise of such right, the Preferred Shares
issued as a result thereof shall become Subject Shares of such
Selling Manager.
6.2 SALE UPON DEFAULT ON INDEBTEDNESS. If a member of Impark Management defaults
on any indebtedness referred to in section 4.4 or commits any act of bankruptcy,
the Designated Representative and FUMI Holdings shall have the option,
exercisable in accordance with the provisions of subsections (a) and (b) of
section 6.1, mutatis mutandis, upon notice (the date of which shall be, for
these purposes, the "Effective Date") to such member at any time following a
default, to purchase all or any portion of the Shares held by such member.
6.3 FUMI HOLDINGS OPTION TO PURCHASE. By notice given to the members of Impark
Management at any time after April 17, 2001, FUMI Holdings shall have the right,
at its option exercisable from time to time, to purchase all or any portion of
the Shares held by any member or members of Impark Management. The date of the
giving of any such notice shall be the "Effective Date".
6.4 SALE OF PREFERRED SHARES. By written notice given to Canco 1 and FUMI
Holdings, at any time during the month of March in any year commencing with
March of 2004, any member of Impark Management who is not at such time employed
by any of FUR, FUMI or a subsidiary of any of them (the "Selling Manager") shall
have the right, at his option, to require Canco 1 to purchase all of the
Preferred Shares then owned by such Selling Manager unless such purchase by
Canco 1 would result in a breach or default under any agreement between Canco 1
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and a Third Party or would otherwise be contrary to law. The date of the giving
of any such notice shall be the "Effective Date", subject to such condition.
6.5 PURCHASE PRICE. The purchase price per share for Shares transferred pursuant
to sections 6.1, 6.2, 6.3 and 6.4 shall be the Fair Value Per Share as of the
Effective Date.
6.6 CONFLICT WITH THIRD PARTY OFFER. If an Effective Date occurs with respect to
a member at any time following the delivery of a notice pursuant to section 5.1
setting out a Third Party Offer, the provisions of this Article 6 shall not
apply with respect to the Shares held by such member or Affiliate of such member
unless (i) FUMI Holdings has not required such member to sell his Shares
pursuant to section 5.1 and the member has elected not to sell any Shares held
by the member in accordance with alternative (b) of section 5.2, in which case
the provisions of this Article 6 shall apply, (ii) the purchase and sale
transaction with the Third Party pursuant to section 5.1 is not completed for
any reason other than the default of the member, in which case the provisions of
this Article 6 shall apply, or (iii) such member has become obligated to sell
less than all of his Shares to the Third Party, in which case the provisions of
this Article 6 shall apply to those Shares held by such member which he has not
become so obligated to sell.
6.7 COMPLETION. Subject as hereinafter provided, each transfer of Shares under
this Article 6 shall for all purposes be deemed to have been completed on the
Effective Date relating thereto and title to the Shares being transferred shall
pass to the transferee thereof on and as of such date. In the case of transfers
of Shares other than pursuant to section 6.4 and subsection (c) of section 6.1,
the party having the option to purchase shall, in the notice exercising such
option, notify the Selling Manager of a date and time (the "Date of Closing" and
"Time of Closing", respectively, for the purposes of Article 8) for the payment
of the purchase price for the Subject Shares, which date shall be not more than
sixty (60) days after the date of such notice and the closing shall be effected
in the manner provided for in Article 8. In the case of transfers to Canco 1 of
Common Shares pursuant to subsection (c) of section 6.1 and of Preferred Shares
pursuant to section 6.4, Canco 1 shall notify the Selling Manager of a date and
time (the "Date of Closing" and "Time of Closing", respectively, for the
purposes of Article 8) for the payment of the purchase price for the Subject
Shares, which date shall be not more than sixty (60) days after the date of such
notice and the closing shall be effected in the manner provided for in Article
8. Notwithstanding the foregoing, any transfer of Shares to Canco 1 provided for
in section 6.4 or in subsection (c) of section 6.1 shall be conditional upon all
of the members of Impark Management, other than the Selling Manager, consenting
to such transfer and waiving any rights they may have as a condition precedent
to or as a consequence of such transfer in their capacity as holders of
Preferred Shares and Common Shares (i) to the immediate payment of any accrued
but unpaid dividends on their Preferred Shares or (ii) to the contemporaneous
repurchase of any of their Shares. The members of Impark Management hereby
consent to any such transfer
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and waive any such rights to the extent arising as a result of any such transfer
and hereby authorize and direct the Designated Representative to execute and
deliver on their behalf at the time of any such transfer a document confirming
such consent and waiver.
ARTICLE 7
FAMILY LAW
----------
7.1 PREVENTION OF TRANSFER ORDERS. Each member of Impark Management agrees to
use his best efforts to prevent or avoid any order or similar act being rendered
by any court of competent jurisdiction under the Family Law Act (Ontario), the
Divorce Act (Canada) or comparable laws or legislation of any other jurisdiction
that would have the effect of transferring beneficial ownership of the Shares
held by such member or any Affiliate of such member to any person (other than by
reason of that person being the individual's heir or legal personal
representative at the time of his or her death or mental incapacity) who was
not, immediately prior to the making of such order or similar act, a member of
Impark Management (any such act or order being a "Transfer Order"), except that
this section 7.1 shall not require any such member to obtain the execution by
his Spouse of any instrument binding such Spouse to the terms of this Article 7
prior to the time of any transfer of Shares or any beneficial interest therein
to his Spouse.
7.2 RIGHT OF FIRST REFUSAL ON TRANSFER. Each member of Impark Management agrees
that any amount that is required to be paid by the member to any Spouse of the
member by order of a court of competent jurisdiction shall, if reasonably
possible, be satisfied by the transfer to such Spouse of property of the member
other than the Shares. If a Transfer Order is made or if any transfer or sale of
Shares is required to satisfy a court order, the affected member of Impark
Management shall forthwith give written notice thereof to the Designated
Representative and FUMI Holdings (the date of the giving of such notice being
the "Effective Date") and the Designated Representative and FUMI Holdings shall
have first rights, in accordance with the provisions of subsections (a) and (b)
of section 6.1, mutatis mutandis, to acquire from such member or any transferee
such Shares as are subject to a Transfer Order or otherwise required to be sold,
at a price per Share (without interest) equal the Fair Value Per Share of such
Shares on the Effective Date.
ARTICLE 8
COMPLETION OF PURCHASE AND SALE OF SHARES
-----------------------------------------
8.1 OUTSTANDING INDEBTEDNESS. If any indebtedness of the Vendor to: (i) any
authorized pledgee pursuant to any financing in accordance with section 4.4;
(ii) the Corporation, Canco 1, FUMI Holdings, 504308 N.B. Inc. or any of their
affiliates; or
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(iii) the Purchaser; is outstanding upon the occurrence of any purchase and sale
of Shares hereunder, the Vendor hereby irrevocably authorizes and directs that a
portion of the Purchase Price for the Purchased Shares equal to such outstanding
indebtedness be applied in repayment of such indebtedness. The Purchased Shares
shall not be registered in the name of the Purchaser unless all such
indebtedness has been repaid to the extent of the Purchase Price.
8.2 DELIVERY OF SHARES AND PAYMENT. At the Time of Closing on the Date of
Closing in respect of any sale and purchase of Purchased Shares, the parties
shall attend at the offices where the closing is being held, the Vendor shall
deliver to the Purchaser certificates representing the Purchased Shares, duly
endorsed in blank for transfer (or, if the Depositary holds such certificates
pursuant to Article 9, an acknowledgement that the Depositary holds such
certificates for the Purchaser), and the Purchaser shall pay to the Vendor the
Purchase Price (or the balance thereof after the repayment of any indebtedness
referred to in section 8.1).
8.3 VENDOR DEFAULT. If the Vendor does not attend at the place of closing at the
Time of Closing, or fails for any reason whatsoever to produce and deliver to
the Purchaser the certificates representing the Purchased Shares duly endorsed
in blank for transfer (or, if the Depositary holds such certificates pursuant to
Article 9, an acknowledgement that the Depositary holds such certificates for
the Purchaser) at or prior to the time payment of the Purchase Price therefor is
required to be made, then the Purchase Price shall be deposited at the time
otherwise provided for its payment into a special account in the name of the
Vendor at the branch of the principal Canadian chartered bank (the "Bank")
primarily utilized by the Corporation. Such deposit shall constitute valid and
effective payment to the Vendor of the Purchase Price and shall result in title
to the Purchased Shares passing to the Purchaser, even if the Vendor has
voluntarily sold or pledged any of the Purchased Shares, and notwithstanding
that certificates representing any of the Purchased Shares may have been
delivered to an authorized pledgee, a transferee or other person. If any of the
Purchased Shares have been pledged to an authorized pledgee to secure
obligations or indebtedness of the Vendor, the Purchaser may, at its option, in
lieu of depositing the Purchase Price as aforesaid, pay all or any part of the
Purchase Price to the authorized pledgee to the extent required to discharge
such obligations or indebtedness and receive the certificates representing the
Purchased Shares from the authorized pledgee and deposit the remainder, if any,
of the Purchase Price as aforesaid.
8.4 TRANSFER OF TITLE. From and after the Date of Closing until the time
provided for the payment for the Purchased Shares, and thereafter if such
payment is then made or if a deposit and/or payment is then made in accordance
with section 8.3, and even though the certificates representing the Purchased
Shares may not have been delivered to the Purchaser, the purchase of the
Purchased Shares shall be deemed to have been fully completed and all right,
title, benefit and interest, both at law and in equity, in and to the Purchased
Shares (except as provided in section 8.5)
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shall be deemed to have been transferred and assigned to and become vested in
the Purchaser and all right, title, benefit and interest, both at law and in
equity, of the Vendor or of any transferee, pledgee or any other person having
any interest, legal or equitable, therein or thereto shall cease and determine.
8.5 PAYMENT OF DEFAULTING VENDOR. Subject to section 8.1, the Vendor shall be
entitled to receive the Purchase Price deposited with the Bank upon delivery to
the Purchaser of the certificates representing the Purchased Shares, duly
endorsed in blank for transfer (or, if the Depositary holds such certificates
pursuant to Article 9, an acknowledgement that the Depositary holds such
certificates for the Purchaser).
8.6 POWER OF ATTORNEY. The Vendor hereby irrevocably constitutes and appoints
the Designated Representative (and if the Designated Representative is the
Vendor he appoints each of the officers from time to time of FUMI Holdings) as a
true and lawful attorney-in-fact and agent for, in the name of and on behalf of,
the Vendor to execute and deliver in the name of the Vendor all such
assignments, transfers, deeds, receipts, directions and instruments as may be
necessary effectively to sell, transfer and assign the Purchased Shares, or any
part thereof, to the Purchaser on the books of Canco 1. Each member of Impark
Management shall deliver to the Designated Representative concurrently with the
execution of this agreement a continuing power of attorney for the purposes set
out in section 3.2 and this Article 8 in accordance with section 3.2 and shall
hereafter, upon request, provide such additional or replacement powers of
attorney for such purposes as may be required to fulfil the requirements of
applicable law for valid, effective and enforceable powers of attorney. Each
member of Impark Management hereby ratifies and confirms and agrees to ratify
and confirm all that the attorney appointed pursuant to this section 8.6 may
lawfully do or cause to be done by virtue of the authority hereby and thereby
conferred.
8.7 CONSENT. The Vendor hereby irrevocably consents to any sale or transfer of
the Purchased Shares made pursuant to the provisions hereof.
ARTICLE 9
DEPOSITARY ARRANGEMENTS
-----------------------
9.1 DEPOSIT OF SHARE CERTIFICATES. For so long as this agreement remains in
force, the certificates representing all of the Shares that are at any time held
by any member of Impark Management shall be held by FUMI Holdings or a person
designated by FUMI Holdings (the "Depositary") to be dealt with in accordance
with this agreement. Notwithstanding the foregoing, in the event that FUMI
Holdings consents to the pledge of any Shares pursuant to section 4.4, Shares
that are pledged as a result to any authorized pledgee shall, for so long as
they are held by such authorized pledgee pursuant to such pledge, not be
governed by this Article 9.
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9.2 DEPOSIT RECEIPT. The Depositary will issue in the name of and deliver to
each member of Impark Management who deposits with the Depositary a certificate
or certificates representing Shares, a receipt (the "Deposit Receipt") in
substantially the form annexed hereto as Schedule G to evidence such deposit,
which Deposit Receipt shall be non-transferable.
9.3 TRANSFER OF SHARES. If a transfer of Shares has been made in accordance with
the provisions of this agreement, upon delivery to the Depositary of (a) the
relevant Deposit Receipt and (b) written evidence satisfactory to the Depositary
that the transfer of Shares has been made in accordance with the provisions of
this agreement, the Depositary shall return the certificates representing such
Shares to Canco 1 for cancellation and Canco 1 shall cancel such Share
certificates and issue in the name of the transferee new Share certificates
evidencing the transferred Shares and, if less than all the Shares held by a
transferor have been transferred, issue in the name of the transferor new Share
certificates evidencing the Shares that were not transferred, which Share
certificates shall be delivered by Canco 1 to the Depositary to be dealt with in
accordance with the terms of this agreement. Upon receipt by the Depositary of
such new Share certificates, the Depositary shall issue in the name of and
deliver to such transferee a Deposit Receipt evidencing such transferee's rights
to the deposited Share certificates issued in the transferee's name subject to
the terms of this agreement, and, if applicable, shall issue in the name of and
deliver to such transferor a Deposit Receipt evidencing such transferor's rights
to the deposited Share certificates issued in the transferor's name subject to
the terms of this agreement.
9.4 RETURN OF SHARE CERTIFICATES. On the termination of this agreement, each
Deposit Receipt shall entitle the holder thereof, or his executors,
administrators, legal personal representatives or its successors or assigns, or
its or his or their attorney duly appointed by an instrument in writing in form
and execution satisfactory to the Depositary, as the case may be, to
certificates representing the number of Shares represented thereby on surrender
of such Deposit Receipt to the Depositary. Each party agrees that, except as
otherwise expressly provided herein, the Shares represented by certificates
deposited with the Depositary in accordance with the terms hereof shall not be
released by the Depositary except on termination of this agreement and that each
such party will not request nor be entitled to the release of certificates
except on such basis.
9.5 RIGHTS TO REMAIN WITH MEMBERS. FUMI Holdings hereby acknowledges and
confirms on behalf of itself and any designee of it that may at any time be the
Depositary that (a) the Depositary will hold the certificates representing
Shares subject to the provisions hereof, (b) the Depositary does not and will
not have any beneficial interest in the Shares in respect of which certificates
have been delivered to it pursuant to this Article 9 solely by reason of such
delivery, and (c) beneficial ownership of the Shares represented by certificates
deposited with the Depositary pursuant to this Article 9 and all other rights of
ownership with respect
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thereto shall remain with the members of Impark Management on behalf of whom the
same were deposited with the Depositary, subject to the powers of attorney
provided under sections 3.2 and 8.6.
9.6 LIMITATION OF DEPOSITARY LIABILITY. The Depositary shall be entitled to rely
as to all matters of fact conclusively upon documents and instruments in writing
signed by the members of Impark Management registered as holders of Shares or by
the Designated Representative as their lawful attorney. The Depositary shall not
be liable for relying in good faith on any such document required or permitted
to be given hereunder.
ARTICLE 10
MISCELLANEOUS
-------------
10.1 NOTICE. Any notice, document or thing required or permitted to be given or
delivered hereunder shall be deemed to be properly given or delivered to a party
if (a) delivered in person or by courier to the address set out below and
acknowledged by written receipt signed by the person receiving such notice, or
(b) sent by facsimile transmission and confirmed by prepaid registered letter
addressed to the party receiving such notice, at its respective address or fax
number set out below:
FUMI Holdings: c/o First Union Management, Inc.
Suite 1910
55 Public Square
Cleveland, Ohio
44113-1937
Attention: Paul F. Levin
Fax: (216) 781-7364
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Canco 1: c/o First Union Management, Inc.
Suite 1910
55 Public Square
Cleveland, Ohio
44113-1937
Attention: John Dee
Fax: (216) 781-7467
Impark Management: Designated Representative
c/o Imperial Parking Limited
Suite 300, The Station
601 West Cordova Street
Vancouver, British Columbia
V6B 1G1
Attention: Paul T. Clough
Fax: (604) 681-4098
Any notice or delivery given in accordance with the provisions of this section
10.1 shall be deemed to have been given and received, if delivered in person or
by courier, on the day of delivery in person or at the time of actual receipt
thereof, and if delivered by facsimile transmission on the date of receipt of
the facsimile transmission at the time of actual receipt thereof unless received
after business hours or on a day other than a Business Day and then on the next
Business Day.
10.2 CHANGE OF ADDRESS. Any party may from time to time by notice in writing
delivered in accordance with the provisions of this Article 10 change its
address for purposes hereof.
10.3 COUNTERPARTS. This agreement may be executed in any number of counterparts,
each of which shall constitute an original, and all of which collectively shall
constitute a single instrument.
10.4 SUCCESSORS AND ASSIGNS. This agreement shall enure to the benefit of and be
binding upon the parties hereto and their respective heirs, legal personal
representatives, successors and permitted assigns. FUMI Holdings may assign its
rights and obligations hereunder to FUMI or any corporation controlled by FUMI
without the consent of any other party hereto. No other party hereunder may
assign its rights or obligations hereunder without the prior written consent of
FUMI Holdings.
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10.5 GOVERNING LAW. This agreement shall be construed and interpreted in
accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein. Each of the parties hereby irrevocably attorns to the
non-exclusive jurisdiction of the courts of the Province of Ontario and all
courts competent to hear appeals therefrom.
10.6 SEVERABILITY. If any provision contained herein is determined to be void or
unenforceable in whole or in part, it shall not be deemed to affect or impair
the validity of any other provision herein and each such provision is deemed to
be separate and distinct.
10.7 ENTIRE AGREEMENT. This agreement constitutes the entire agreement between
the parties hereto pertaining to the respective obligations of Impark Management
and the other parties hereto in respect of the Shares, save and except for the
Share Purchase Agreement. There are not and shall not be any oral statements,
representations, warranties, undertakings or agreements between the parties with
respect to the subject matter hereof and this agreement may not be amended or
modified in any respect except by written instrument signed by the parties
hereto.
10.8 IMPLEMENTATION OF AGREEMENT. The parties hereto hereby covenant and agree
to do or cause to be done all acts and things, whether by the directors of the
Corporation or Canco 1 or otherwise, to execute and deliver or cause to be
executed and delivered all such instruments and to exercise or cause to be
exercised any and all voting rights attaching to the Shares held by each of them
in order that all provisions of this agreement shall be fully and effectively
carried out, implemented and given effect to in accordance with the terms
hereof. Canco 1 agrees not to take or approve any action that would contravene
any provision of this agreement and shall cause to be provided all necessary
approvals for any transfer of Shares that is effected in compliance with this
agreement.
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10.9 TERMINATION. This agreement shall terminate upon the agreement of
shareholders of Canco 1 who hold at least 90% of the voting rights attached to
all Class B Common Shares or, if earlier, at the option of FUMI Holdings
immediately upon the closing of a sale of 90% or more of the outstanding Common
Shares to a Third Party in accordance herewith.
IN WITNESS WHEREOF this agreement has been executed by the
parties hereto as of the date first above written.
SIGNED, SEALED AND DELIVERED )
in the presence of )
)
) /s/ Paul T. Clough
)-----------------------------
)Paul T. Clough
)
) /s/ J. Bruce Newsome
) -----------------------------
) J. Bruce Newsome
)
) /s/ Douglas I. Poirier
) -----------------------------
) Douglas I. Poirier
)
) /s/ J. Robin Bateman
) -----------------------------
) J. Robin Bateman
)
) /s/ James MacKay
) -----------------------------
) James MacKay
)
) /s/ Michael T. Menzies
) -----------------------------
) Michael T. Menzies
)
) /s/ Robert L. Noiles
) -----------------------------
) Robert L. Noiles
)
) /s/ Harry J. Renaud
) -----------------------------
) Harry J. Renaud
)
) /s/ Stuart M. MacKenzie
) -----------------------------
) Stuart M. MacKenzie
26
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)
)
)
) -----------------------------
) Daniel Sawchuck
)
LAURENTIAN BANK OF CANADA,
in trust for J.Bruce Newsome,
Accont No. VOO2679
by Authorized Signer
-----------------------------
RBC DOMINION SECURITIES INC.,
in trust for Douglas I. Poirier,
Account No. 496-81890-11
by Authorized Signer
-----------------------------
GUNDYCO,
in trust for J. Robin Bateman,
Account No. 590-90333-17
by Authorized Signer
-----------------------------
GUNDYCO,
in trust for Robert L. Noiles,
Account No. 590-77616-12
by Authorized Signer
-----------------------------
GUNDYCO,
in trust for Stuart M. MacKenzie,
Account No. 590-90254-12
by Authorized Signer
-----------------------------
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MIDLAND WALWYN CAPITAL INC.,
in trust for Henry J. Renaud,
Account No. 8RABNQS
by /S/ Authorized Signer
-------------------------------
3355489 CANADA INC.
by /S/ Authorized Signer
-------------------------------
3357392 CANADA INC.
by /S/ Authorized Signer
-------------------------------
28
SCHEDULE A
MEMBERS OF IMPARK MANAGEMENT
----------------------------
Number of Number of Common
Individual Common Shares Shares Under Option
- ---------- ------------- -------------------
Paul T. Clough 600,000 300,000
J. Bruce Newsome 125,000 112,500
Douglas I. Poirier 100,000 75,000
J. Robin Bateman 60,000 45,000
James MacKay 90,000 45,000
Michael T. Menzies 90,000 45,000
Robert L. Noiles 60,000 45,000
Harry J. Renaud - 45,000
Stuart M. MacKenzie - 22,500
Daniel Sawchuck 45,000 22,500
Trusts
- ------
Laurentian Bank of Canada, 100,000 -
in trust for account no. VOO2679,
a registered retirement savings plan
of which J. Bruce Newsome is the
sole beneficiary
RBC Dominion Securities Inc., 50,000 -
in trust for account no. 496-81890-11
a registered retirement savings plan
of which Douglas I. Poirier is the
sole beneficiary
29
Gundyco, in trust for account 30,000 -
no. 590-90333-17, a registered
retirement savings plan of which
J. Robin Bateman is the sole
beneficiary
Gundyco, in trust for account 30,000 -
no. 590-77616-12, a registered
retirement savings plan of which
Robert L. Noiles is the sole
beneficiary
Midland Walwyn Capital Inc., 90,000 -
in trust for account no. 8RABNQS,
a registered retirement savings plan
of which Henry J. Renaud is the sole
beneficiary
Gundyco, in trust for account 45,000 -
no. 590-90254-12, a registered
retirement savings plan of which
Stuart M. MacKenzie is the sole
beneficiary
30
SCHEDULE B
- -----------------------------------------------------------------------------------------------------------------------------------
Cash Received
Total Shares of (including from Class A Class B
Name Holdings at Closing Escrow Account) Common Shares Common Shares Preferred Shares
- ---- ------------------- --------------- ------------- ------------- ----------------
Paul T. Clough 900,000 833,560 348,585 96,169 503,956
Bruce Newsome 237,500 337,247 49,878 11,088 72,109
Laurentian Bank 100,000 396,060 - - -
(Newsome RRSP)
Doug Poirier 175,000 240,616 39,416 9,537 56,984
RBC Dominion Securities 50,000 198,030 - - -
(Poirier RRSP)
Rob Bateman 105,000 156,826 19,072 4,460 27,573
Gundyco (Bateman RRSP) 30,000 118,818 - - -
Jim MacKay 135,000 154,629 41,414 11,425 59,872
Mike Menzies 135,000 154,629 41,414 11,425 59,872
Rob Noiles 105,000 185,279 8,618 1,576 12,459
Gundyco (Noiles RRSP) 30,000 118,818 - - -
Harry Renaud 45,000 72,750 6,394 - 9,971
Midland Walwyn Capital 90,000 356,454 - - -
(Renaud RRSP)
Stuart MacKenzie 22,500 32,922 4,717 98 6,820
Gundyco (MacKenzie RRSP) 45,000 178,227 - - -
Dan Sawchuck 67,500 77,314 20,707 5,713 29,936
- -----------------------------------------------------------------------------------------------------------------------------------
31
SCHEDULE C
Shares of Canco 1 to be Acquired
------------------------------------------------------------------------
Subscribers Class A Common Class B Common Preferred Shares
- -------------------------------------------------------------------------------------------------------------
Laurentian Bank of Canada, in 71,780 22,476 103,774
trust for account no. VOO2679, a
registered retirement savings plan
of which J. Bruce Newsome is the
sole beneficiary
- -------------------------------------------------------------------------------------------------------------
RBC Dominion Securities Inc., 35,890 11,238 51,887
in trust for account no.
496-81890-11 a registered
retirement savings plan of
which Douglas I. Poirier is
the sole beneficiary
- -------------------------------------------------------------------------------------------------------------
Gundyco, in trust for account 21,534 6,743 31,132
no. 590-90333-17, a registered
retirement savings plan of
which J. Robin Bateman is the
sole beneficiary
- -------------------------------------------------------------------------------------------------------------
Gundyco, in trust for account 21,534 6,743 31,132
no. 590-77616-12, a registered
retirement savings plan of
which Robert L. Noiles is the
sole beneficiary
- -------------------------------------------------------------------------------------------------------------
32
- -------------------------------------------------------------------------------------------------------------
Midland Walwyn Capital Inc., 64,602 20,229 93,396
in trust for account no.
8RABNQS, a registered
retirement savings plan of
which Harry J. Renaud is the
sole beneficiary
- -------------------------------------------------------------------------------------------------------------
Gundyco, in trust for account 32,301 10,114 46,698
no. 590-90254-12, a registered
retirement savings plan of
which Stuart M. MacKenzie is
the sole beneficiary
- -------------------------------------------------------------------------------------------------------------
Paul T. Clough 179,007 48,743 258,067
- -------------------------------------------------------------------------------------------------------------
33
SCHEDULE D
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS that the undersigned hereby irrevocably
nominates, constitutes and appoints ________________________ (the "Attorney") ,
as the true and lawful attorney-in-fact and agent for the undersigned and in the
name, place and stead of the undersigned, in the capacity of the undersigned as
a shareholder of 3357392 Canada Inc. for the following purposes:
(i) to execute and deliver proxies and vote any and all shares of the
undersigned in 3357392 Canada Inc. on behalf of the undersigned in respect
of any matter on which the undersigned is entitled to vote in such manner
as may be determined by the Attorney in his sole discretion; and
(ii) to execute and deliver any and all assignments, transfers, deeds,
directions, receipts and other instruments as may be necessary effectively
to sell, transfer and assign any of such shares in accordance with the
provisions of the shareholders' agreement made as of April 17, 1997.
The execution of this document indicates the intention of the undersigned
that this document provides the Attorney with a continuing power of attorney for
property under the [SUBSTITUTE DECISIONS ACT (ONTARIO)] for the purposes set out
herein and that such appointment and power of attorney, being coupled with an
interest, shall not be revocable at the option of the undersigned and shall not
be revoked by the insolvency, bankruptcy or incapacity of the undersigned and
shall come into effect upon the date that this document is signed and witnessed.
The undersigned hereby ratifies and confirms and agrees to ratify and confirm
all that the Attorney may lawfully do or cause to be done by virtue of this
power of attorney.
DATED this day of , 199 .
- ------------------------------------ ---------------------------------
Name of Witness Name of Appointor
- ------------------------------------ ---------------------------------
Signature Signature
- ------------------------------------ ---------------------------------
Name of Witness
- ------------------------------------
Signature
34
SCHEDULE E
PERFORMANCE ACHIEVEMENT PROGRAM
-------------------------------
1. DEFINITIONS. Capitalized terms which are defined in the shareholders
agreement entered into as of April 17, 1997 between 3355489 Canada Inc., 335392
Canada Inc. and certain employees of Impark have the meanings as provided for
therein. In addition, the following terms have the following meanings:
"PERFORMANCE ACHIEVEMENT" for any year means the Percentage Achievement for
such year of the Performance Bonus Base for such year;
"PERCENTAGE ACHIEVEMENT" means as follows:
(i) for 1997 and 1998, 100% minus the amount of any Shortfall Percentage
for the applicable year;
(ii) for 1999, 100% minus the product of 1.5 and any Shortfall Percentage
for 1999; and
(iii) for 2000, 100% minus the product of 3 and any Shortfall Percentage
for 2000;
"PERFORMANCE BONUS BASE" means as follows:
(i) for 1998, the Percentage Achievement for 1997 of $694,444;
(ii) for 1999, the Performance Achievement for 1998; and
(iii) for 2000, the Performance Achievement for 1999; and
"SHORTFALL PERCENTAGE" for any period means the percentage obtained by
multiplying 100% times the quotient of the Performance Shortfall for such
period divided by the Performance Target for such period.
2. PARTICIPANTS. Subject as hereinafter provided, the participants in the
Program (the "Participants") and the interest of each Participant (the
"Participant's Share") will be as follows:
35
Participant Participant's Share
----------- -------------------
Paul T. Clough 52.35%
J. Bruce Newsome 12.08%
Douglas I. Poirier 7.47%
J. Robin Bateman 4.03%
James MacKay 4.11%
Michael T. Menzies 4.11%
Robert L. Noiles 3.00%
Harry J. Renaud 7.11%
Stuart M. MacKenzie 3.68%
Daniel Sawchuck 2.06%
Notwithstanding the foregoing, in the event that individuals who are employed by
Impark as at April 17, 1997 become new members of Impark Management prior to
June 30, 1997, the Designated Representative shall have the right at any time
prior to such date to include any of such new members as Participants and to
designate the Participant's Share of each such new Participant provided that the
Participant's Share of Paul Clough shall be reduced by the aggregate of the
Participant's Shares of such new Participants. The inclusion and designation
provided for in the preceding sentence shall be made by written notice delivered
to the Corporation and FUMI Holdings on or before June 30, 1997.
3. PERFORMANCE ACHIEVEMENT AWARD. Each Participant will be conditionally
entitled to receive a bonus payment in respect of each of the calendar years
1998, 1999 and 2000. The amount to which a Participant will be conditionally
entitled in respect of any such year will be such Participant's Share of the
Performance Achievement for such year. The actual entitlement of such
Participant to such bonus will be dependant upon such Participant being
continuously employed by any of Impark, FUR or FUMI or a subsidiary of any of
them from April 17, 1997 through to the end of the third calendar year following
the year in respect of which such bonus was determined. If the Participant is so
continuously employed until the end of such third year, he will be paid the full
amount of such bonus on the last day of such third year. If such Participant
ceases to be so employed during such third year, he will be paid on or before
the last day of such third year a pro rata portion of such bonus based on the
number of days he was so employed during such third year relative to the total
number of days in such year.
36
4. COORDINATION. The Program shall be coordinated with the comparable program to
be instituted by 504463 N.B. Inc. so as to ensure that each member of Impark
Management participates in one or the other of the programs without double
counting.
37
SCHEDULE F
PERFORMANCE BONUS PROGRAM
-------------------------
1. DEFINITIONS. Capitalized terms which are defined in the shareholders
agreement entered into as of April 17, 1997 between 3355489 Canada Inc., 335392
Canada Inc. and certain employees of Impark have the meanings as provided for
therein.
2. PARTICIPANTS. The participants in the Program (the "Participants") will be
the employees from time to time of Impark and the interest of each Participant
(the "Participant's Share") will be determined from time to time by the
Designated Representative.
3. PERFORMANCE ACHIEVEMENT AWARD. In 1998, 1999, 2000 and 2001, each Participant
who is still employed by Impark will be entitled to receive a cash bonus payment
equal to such Participant's Share of the amount which is 5% of any amount by
which the Consolidated Performance for the immediately preceding calendar year
exceeds the Performance Target for such immediately preceding calendar year.
4. COORDINATION. The Program shall be coordinated with the comparable program to
be instituted by 504463 N.B. Inc. so as to ensure that each member of Impark
Management participates in one or the other of the programs without double
counting.
38
SCHEDULE G
DEPOSIT RECEIPT
---------------
THE UNDERSIGNED, ____________________ (the "Depositary"), hereby confirms
that ______________________ (the "Holder") is the registered holder of the
following shares (the "Shares") in the capital of 3357392 Canada Inc.:
Class A Non-voting Common Shares _______________________
Class B Voting Common Shares _______________________
Class A Preferred Shares _______________________
The certificates in respect of such Shares are held by the Depositary
pursuant to the agreement (the "Shareholders Agreement") made as of the 17th day
of April, 1997 among 3357392 Canada Inc., 3355489 Canada Inc. and the
individuals and trusts listed on Schedule A thereto. This Deposit Receipt
evidences the ownership by the Holder of the Shares held by the Depositary in
accordance with the Shareholders Agreement. The Depositary is bound to hold the
Shares in accordance with the Shareholders Agreement and the rights of the
Holder with respect to the Shares are expressly subject to, governed by and may
be exercised only in accordance with, the terms and conditions set forth in the
Shareholders Agreement (as such agreement may be amended from time to time). By
acceptance of this Deposit Receipt, the Holder assents to such terms and
conditions.
This Deposit Receipt is not transferable.
IN WITNESS WHEREOF the Depositary has caused this Deposit Receipt to be
signed by its duly authorized signatory this ____ day of ________, _____.
____________________________
by _________________________