As used in this Agreement, the following terms have the following meanings:
“1934 Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder.
“Acquisition Proposal” means, other than the transactions contemplated by this Agreement and other than any transaction involving
only the Corporation and/or one or more of its Subsidiaries or between one or more of its Subsidiaries, any offer, proposal or inquiry (written or oral) from any Person or group of Persons other than the Purchaser (or any of its affiliates or
any Person acting in concert with the Purchaser or any of its affiliates) after the date of this Agreement relating to (i) any direct or indirect sale or disposition (or any lease, license, long-term supply agreement or other arrangement having
the same economic effect as a sale or disposition), in a single transaction or a series of transactions, of assets (including shares of Subsidiaries of the Corporation) representing 20% or more of the consolidated assets or contributing 20% or
more of the consolidated revenue of the Corporation and its Subsidiaries; (ii) any direct or indirect take-over bid, tender offer, exchange offer, treasury issuance or other transaction that, if consummated, would result in such Person or group
of Persons beneficially owning 20% or more of any class of voting or equity securities of the Corporation or any of its Subsidiaries (or securities convertible into or exchangeable for such voting or equity securities) then outstanding; (iii)
any plan of arrangement, merger, amalgamation, consolidation, share exchange, business combination, reorganization, recapitalization, liquidation, dissolution, winding up or exclusive license involving the Corporation or any of its
Subsidiaries; or (iv) any other similar transaction or series of transactions involving the Corporation or any of its Subsidiaries.
“affiliate” has the meaning specified in Regulation 45-106 respecting Prospectus Exemptions, as in effect on the date of this Agreement.
“Agreement” means this arrangement agreement among the Purchaser and the Corporation (including the Schedules hereto) as it may be
amended, modified or supplemented from time to time in accordance with its terms.
“Alternative Financing” has the meaning specified in Section 4.6(3)(b).
“AMF” means the Autorité des marchés financiers (Québec).
“Arrangement” means an arrangement under Section 192 of the CBCA in accordance with the terms and subject to the conditions set out
in the Plan of Arrangement, subject to any amendments or variations to the Plan of Arrangement made in accordance with the terms of this Agreement and the Plan of Arrangement or made at the direction of the Court in the Final Order with the
prior consent of the Corporation and the Purchaser, each acting reasonably.
“Arrangement Resolution” means the special resolution approving the Plan of Arrangement to be considered at the Meeting,
substantially in the form of Schedule B.
“Articles of Arrangement” means the articles of arrangement of the Corporation in respect of the Arrangement, required by the CBCA
to be sent to the Director after the Final Order is made, which shall include the Plan of Arrangement and otherwise be in a form and content satisfactory to the Corporation and the Purchaser, each acting reasonably.
“associate” has the meaning specified in the Securities Act (Québec) as in effect on the
date of this Agreement.
“Authorization” means, with respect to any Person, any order, permit, approval, consent, waiver, license or similar authorization of
any Governmental Entity, whether by expiry or termination of an applicable waiting period or otherwise, that is binding upon or applicable to such Person, or its business, assets or securities.
“Board” means the board of directors of the Corporation, as constituted from time to time.
“Board Recommendation” has the meaning specified in Section 2.4(2).
“Books and Records” means the books and records of the Corporation and its Subsidiaries, including books of account and Tax records,
whether in written or electronic form.
“Breaching Party” has the meaning specified in Section 4.8(3).
“Business Day” means any day of the year, other than a Saturday, Sunday or any day on which major banks are closed for business in
Montreal, Québec.
“CBCA” means the Canada Business
Corporations Act.
“Certificate of Arrangement” means the certificate of arrangement to be issued by the Director pursuant to subsection 192(7) of the
CBCA in respect of the Articles of Arrangement.
“Change in Recommendation” has the meaning specified in Section 7.2(4)(b).
“Circular” means the notice of the Meeting and accompanying management information circular, including all schedules, appendices and
exhibits thereto, to be sent to the Shareholders in connection with the Meeting, as amended, supplemented or otherwise modified from time to time in accordance with the terms of this Agreement.
“Closing” has the meaning specified in Section 2.8.
“Code” means the United States Internal Revenue Code of 1986.
“Collective Agreements” means all collective bargaining agreements or union agreements (including European national collective
bargaining agreements) currently applicable to the Corporation and/or any of its Subsidiaries and all related documents, which impose any obligations upon the Corporation and/or its Subsidiaries, listed in the Data Room.
“Competition Act” means the Competition Act (Canada).
“Confidentiality Agreement” means the confidentiality and non-disclosure agreement dated April 1, 2021 between G. Lamonde
Investissements Financiers Inc. and the Corporation in connection with the transactions contemplated by this Agreement.
“Consideration” means $6.00 in cash per Subordinate Voting Share pursuant to the Plan of Arrangement, without interest.
“Constating Documents” means articles of incorporation, amalgamation, or continuation, as applicable, by-laws or other constating
documents and all amendments thereto.
“Contract” means any legally binding written or, to the knowledge of the Corporation, oral agreement, commitment, engagement,
contract, license, lease, obligation, undertaking or other right or obligation to which the Corporation or any of its Subsidiaries is a party or by which the Corporation or any of its Subsidiaries is bound or affected or to which any of their
respective material properties or their material assets is subject.
“Corporation” has the meaning specified in the preamble.
“Corporation DSUs” means the outstanding deferred stock units issued pursuant to the DSU Plan.
“Corporation Employees” means the employees of the Corporation or its Subsidiaries, as the case may be, including part time and full
time employees.
“Corporation Filings” means all forms, documents and reports, together with all exhibits, financial statements and schedules filed
or furnished therewith, and all information, documents and agreements incorporated in any such form, document or report (but not including any document incorporated by reference into an exhibit), required to have been filed with or furnished to
the applicable Securities Authorities, with the TSX or with Nasdaq since August 31, 2019.
“Corporation PSUs” means the outstanding performance share units issued pursuant to the LTIP.
“Corporation RSUs” means the outstanding restricted stock units issued pursuant to the LTIP.
“Corporation SARs” means the outstanding stock appreciation rights issued pursuant to the SAR Plan.
“Corporation Termination Fee” has the meaning specified in Section 8.2(2).
“Corporation Termination Fee Event” has the meaning specified in Section 8.2(2).
“Court” means the Superior Court of Québec.
“COVID-19” means SARS-CoV-2 or COVID-19, and any evolutions thereof or related or associated epidemics, pandemic or disease
outbreaks.
“D&O Insurance” has the meaning specified in Section 4.9(1).
“D&O Support and Voting Agreements” means, collectively, each of the support and voting
agreements entered into between the Purchaser and directors and officers of the Corporation who own Subordinate Voting Shares, substantially in the form of Schedule F.
“Data Room” means the material contained in the virtual data room established by the Corporation as at 11:59 p.m. on June 6, 2021.
“Debt Commitment Letters” means the executed commitment letters evidencing the commitment of the Debt Financing Sources to provide
the Debt Financing.
“Debt Financing” means the debt financing in the aggregate amount set forth in the Debt Commitment Letters, to be provided on the
terms and conditions set forth therein.
“Debt Financing Sources” means the entities that have committed to provide or otherwise entered into agreements in
connection with the Debt Financing or other debt financings in connection with the transactions contemplated hereby, including the parties to the Debt Commitment Letters and any joinder agreements, credit agreements or collateral agreements
(or other definitive documentation) relating thereto.
“Depositary” means AST Trust Company (Canada), in its capacity as depositary for the Arrangement, or such other person as the
Corporation and the Purchaser agree to engage as depositary for the Arrangement.
“Director” means the Director appointed pursuant to Section 260 of the CBCA.
“Dissent Rights” means the rights of dissent in respect of the Arrangement described in the Plan of Arrangement.
“DSU Plan” means the deferred stock unit plan of the Corporation effective as of January 12, 2005, as amended as of January 10,
2018.
“Effective Date” means the date shown on the Certificate of Arrangement giving effect to the Arrangement.
“Effective Time” has the meaning specified in the Plan of Arrangement.
“Employee Plans” has the meaning specified in Section (28)(a) of Schedule C.
“Excluded Shares” means the Subordinate Voting Shares owned or beneficially controlled by the Purchaser or any of its affiliates.
“Fairness Opinion” means the opinion of TD Securities Inc. to the effect that, as of the date of such opinion, the Consideration to
be received by the SVS Shareholders (other than the holders of the Excluded Shares) is fair, from a financial point of view, to such SVS Shareholders (other than the holders of the Excluded Shares).
“FCPA” means the United States Foreign Corrupt Practices Act of 1977.
“Final Order” means the final order of the Court in a form acceptable to the Corporation and the Purchaser, each acting reasonably,
approving the Arrangement, as such order may be amended by the Court (with the consent of both the Corporation and the Purchaser, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is
withdrawn or denied, as affirmed or as amended (provided that any such amendment is acceptable to both the Corporation and the Purchaser, each acting reasonably) on appeal.
“Financing Parties” means all providers or prospective providers of any Debt Financing and their respective Representatives;
provided that neither the Purchaser nor any affiliate of the Purchaser shall be a Financing Party.
“Formal Valuation” means the formal valuation of the Subordinate Voting Shares prepared by TD Securities Inc. in accordance with the requirements of MI 61-101 for a formal valuation in respect of the transactions contemplated herein and in the Plan of Arrangement.
“G. Lamonde” means Mr. Germain Lamonde, an associate of the Purchaser and the Executive Chairman of Corporation.
“GAAP” means generally accepted accounting principles as set out in the CPA Canada Handbook – Accounting for an
entity that prepares its financial statements in accordance with International Financial Reporting Standards, at the relevant time, applied on a consistent basis.
“Governmental Entity” means (i) any international, multinational, national, federal, provincial, state, territorial, regional,
municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, commissioner, board, bureau, minister, ministry, governor in council, cabinet, agency or instrumentality,
domestic or foreign; (ii) any subdivision, agent or authority of any of the foregoing; (iii) any quasi-governmental or private body including any tribunal, commission, regulatory agency or self-regulatory organization exercising any regulatory,
expropriation or taxing authority under or for the account of any of the foregoing; or (iv) any Securities Authority or stock exchange, including the TSX and the Nasdaq.
“HSR Act” means the United States Hart-Scott-Rodino Antitrust Improvements Act of 1976 as
amended, and the rules and regulations promulgated thereunder.
“Indemnified Persons” has the meaning specified in Section 4.9(4).
“Intellectual Property” means domestic and foreign: (i) patents, applications for patents
and patent disclosures, and including all provisional applications, substitutions, continuations, continuations-in-part, patents of addition, improvement patents, divisions, renewals, reissues, confirmations, counterparts, re-examinations and
extensions thereof; (ii) proprietary and non-public business information, including inventions (whether patentable or not), invention disclosures, improvements, discoveries, trade secrets, confidential information, know-how, methods, processes,
designs, technology, technical data, schematics, formulae and customer lists, and documentation relating to any of the foregoing; (iii) copyrights, copyright registrations and applications for copyright registration; (iv) integrated circuit,
topographies, integrated circuit topography registrations and applications, mask works, mask work registrations and applications for mask work registrations; (v) industrial designs, industrial designation registrations and applications,
designs, design registrations and design registration applications; (vi) trade names, business names, corporate names, domain names, website names and world wide web addresses, common law trade-marks, trade-mark registrations, trade- mark
applications, trade dress and logos, and the goodwill associated with any of the foregoing; (vii) Software; and (viii) any other intellectual property and industrial property.
“Interim Order” means the interim order of the Court in a form acceptable to the Corporation and the Purchaser, each acting
reasonably, providing for, among other things, the calling and holding of the Meeting, as such order may be amended by the Court with the consent of the Corporation and the Purchaser, each acting reasonably.
“Law” means, with respect to any Person, any and all applicable national, federal,
provincial, state, municipal or local law (statutory, civil, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgment, decree, ruling or other similar requirement, whether domestic
or foreign, enacted, adopted, promulgated or applied by a Governmental Entity that is binding upon or applicable to such Person or its business, undertaking, property or securities, and to the extent that they have the force of law, all
policies, guidelines, notices and protocols of any Governmental Entity, as amended.
“Lease” means any Contract pursuant to which the Corporation or any of its Subsidiaries leases, or
holds a leasehold interest in, a Leased Property.
“Leased Properties” means the premises listed and described in the Annual Report on Form 20-F of
the Corporation dated November 25, 2020, as updated by the document “Extract 4D Property, Plan and Equipment updated 2021-05-05” in the Data Room, and identified as being leased by the Corporation or any of its Subsidiaries therein.
“Lien” means any mortgage, charge, pledge, hypothec, security interest, prior claim,
encroachment, option, right of first refusal or first offer, occupancy right, restrictive covenant, assignment, lien (statutory or otherwise), defect of title or encumbrance of any kind.
“LTIP” means the long-term incentive plan of the Corporation dated as of May 25, 2000 and amended as of January 9, 2004, January 12,
2005, January 6, 2016, January 10, 2018 and January 9, 2019.
“Matching Period” has the meaning specified in
Section 5.4(1)(e).
“Material Adverse Effect” means any fact, state of facts, change, event, occurrence, effect or circumstance that, individually or in
the aggregate with other such facts, state of facts, changes, events, occurrences, effects or circumstances is or would reasonably be expected to be both material and adverse to the business, operations, affairs, results of operations, assets,
properties, liabilities (contingent or otherwise) or financial condition of the Corporation and its Subsidiaries, taken as a whole; except any such fact, state of facts, change, event, occurrence, effect, or circumstance resulting from or
arising in connection with:
(h)
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the failure by the Corporation in and of itself to meet any internal or public projections, forecasts, guidance or estimates of revenues or earnings (it being understood that the cause underlying
such failure may be taken into account in determining whether a Material Adverse Effect has occurred) or any seasonal fluctuations in the Corporation’s results;
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(i)
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any action taken (or omitted to be taken) by the Corporation or any of its Subsidiaries which is required to be taken (or omitted to be taken) pursuant to this Agreement;
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(j)
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any actions taken (or omitted to be taken) upon the request of the Purchaser;
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(k)
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the announcement or performance of this Agreement or the consummation of the Arrangement; or
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(l)
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any change in the market price or trading volumes of any securities of the Corporation (it being understood that the causes underlying such change in market price or trading volumes may be taken
into account in determining whether a Material Adverse Effect has occurred);
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provided, however, that with respect to clauses (a) through to and including (g), such matter does not have a materially disproportionate effect on the Corporation and its
Subsidiaries, taken as a whole, relative to other comparable companies or entities operating in the markets and in the industries in which the Corporation and its Subsidiaries operate; and unless expressly provided in any particular section of
this Agreement, references in certain sections of this Agreement to dollar amounts are not intended to be, and shall not be deemed to be, illustrative or interpretive for purposes of determining whether a “Material Adverse Effect” has occurred.
“Material Contract” means any Contract, other than any intercompany Contract among the Corporation and the Subsidiaries:
(g)
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that creates an exclusive dealing arrangement or right of first offer or refusal or “most favoured nation” obligation in favour of another person (other than customary territorial restrictions in
Contracts with agents or resellers);
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(h)
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with a Governmental Entity for a value in excess of $5,000,000;
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(i)
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providing for the purchase, sale or exchange of, or option to purchase, sell or exchange, any property or asset where the purchase or sale price or agreed value or fair market value of such property
or asset exceeds $5,000,000 and other than in the Ordinary Course;
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(j)
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relating to any litigation or settlement thereof which does or could have actual or contingent obligations or entitlement of the Corporation or any of its Subsidiaries in excess of $5,000,000 and
which have not been fully satisfied prior to the date of this Agreement;
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(k)
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that limits or restricts in any material respect (A) the ability of the Corporation or any of its Subsidiaries to engage in any line of business or carry on business in any geographic area, or (B) the
scope of Persons to whom the Corporation or any of its Subsidiaries may sell products or deliver services (other than customary territorial restrictions in Contracts with agents or resellers);
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(m)
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that is otherwise material to the Corporation and its Subsidiaries, taken as a whole;
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and includes each of the Contracts listed or referred to in the Data Room or identified in the Corporation’s Filings or in the Annual Report on Form 20-F dated November 25,
2020 (or incorporated by reference therein).
“Meeting” means the special meeting of Shareholders, including any adjournment or postponement of such special meeting in accordance
with the terms of this Agreement, to be called and held in accordance with the Interim Order to consider the Arrangement Resolution and for any other purpose as may be set out in the Circular and agreed to in writing by the Purchaser.
“MI 61-101” means Regulation 61-101 respecting Protection
of Minority Shareholders in Special Transactions.
“Misrepresentation” has the meaning specified in the Securities
Act (Québec) and other Securities Laws.
“Money Laundering Laws” has the meaning specified in Section (31) of Schedule C.
“Multiple Voting Shares” means the multiple voting shares in the capital of the Corporation.
“MVS Shareholders” means the registered or beneficial holders of the Multiple Voting Shares,
as the context requires, being, as of the date of this Agreement, G. Lamonde Investissements Financiers Inc. and 9356-8988 Québec Inc.
“Nasdaq” means the Nasdaq Global Select Market.
“officer” has the meaning specified in the Securities Act (Québec).
“Ordinary Course” means, with respect to an action taken by the Corporation or one of its Subsidiaries,
that such action is consistent with the past practices of the Corporation or such Subsidiary and is taken in the ordinary course of the normal day-to-day operations of the business of the Corporation or such Subsidiary provided “Ordinary Course” shall exclude any measures taken in response to the actual or reasonably anticipated effect of the COVID-19 pandemic, except those taken to the extent necessary to comply with any
Law, order or directive by any Governmental Entity in response to COVID-19 (including, as required to comply with “quarantine”, “stay at home”, “social distancing” and “travel restrictions” directives) or reasonably required to protect the
health and safety of Corporation Employees and other persons with whom the Corporations and its Subsidiaries come into contact with during the ordinary course of business operations.
“Outside Date” means September 30, 2021 or such later date as may be agreed to in writing by the Parties.
“Owned Intellectual Property” means the Intellectual Property owned by the Corporation and its Subsidiaries.
“Owned Properties” means the lands and premises listed and described in the Annual Report on Form
20-F of the Corporation dated November 25, 2020, as updated by the document “Extract 4D Property, Plan and Equipment updated 2021-05-05” in the Data Room, and identified as being owned by the Corporation or any of its Subsidiaries therein.
“Parties” means the Corporation, the Purchaser and the Purchaser Parent and “Party” means
any one of them.
“Permitted Liens” means, in respect of the Corporation or any of its Subsidiaries, any one or more of the following:
“Person” includes any individual, partnership, association, body corporate, organization, trust, estate, trustee, executor,
administrator, legal representative, government (including Governmental Entity), syndicate or other entity, whether or not having legal status.
“Plan of Arrangement” means the plan of arrangement in the form of Schedule A to this Agreement, and any amendments or variations to
such plan made in accordance with its terms, the terms of this Agreement or made at the direction of the Court in the Final Order with the prior consent of the Corporation and the Purchaser, each acting reasonably.
“Pre-Acquisition Reorganization” has the meaning specified in Section 4.5(1).
“PSU Agreement” means an agreement evidencing the terms of any Corporation PSU.
“Purchaser” has the meaning specified in the preamble.
“Purchaser Parent” has the meaning set forth in the preamble.
“Purchaser Termination Fee” means 2.75% of the total Consideration to be paid by the Purchaser pursuant to the Arrangement.
“Representative” means, with respect to any Person, any officer, director, employee,
representative (including any financial, legal or other advisor) or agent of such Person or of any of its Subsidiaries.
“Required Information” has the meaning specified in Section 4.6(6).
“Required Shareholder Approval” means the required vote set forth in Section 2.2(2), together with any other vote required under the
Interim Order.
“Restricted Parties” has the meaning specified in Section (33) of Schedule C.
“RSU Agreement” means an agreement evidencing the terms of any Corporation RSU.
“Schedule 13E-3” means a Rule 13e-3 transaction statement under Section 13(e) of the 1934 Exchange Act with respect to the
transactions contemplated by this Agreement and the Plan of Arrangement to be filed with the United States Securities and Exchange Commission, as may be amended or supplemented.
“Securities Authority” means the AMF, the United States Securities and Exchange Commission and any other applicable securities
commission or regulatory authority of a province or territory of Canada, the United States or any other jurisdiction with authority in respect of the Parties and/or the Subsidiaries.
“Securities Laws” means the Securities Act (Québec), U.S. Securities Laws and any other
applicable Canadian provincial and territorial or United States securities Laws, rules, orders, notices, promulgations and regulations and published policies thereunder and, where applicable, applicable securities laws and regulations or other
jurisdictions.
“Securityholders” means, collectively, the Shareholders and the holders of Corporation DSUs, Corporation SARs, Corporation PSUs and
Corporation RSUs.
“Shareholders” means the SVS Shareholders and the MVS Shareholders.
“Software” means computer software and programs (both source code and object code form), all proprietary rights in the computer
software and programs and all documentation and other materials related to the computer software and programs.
“Independent Committee” means any special committee consisting of independent members of the Board formed in connection with the
Arrangement and the other transactions contemplated by this Agreement.
“SAR Plan” means the Stock Appreciation Rights Plan of the Corporation established on August 4, 2001, as amended on January 12,
2010.
“Subordinate Voting Shares” means the subordinate voting shares in the capital of the
Corporation.
“Subsidiary” has the meaning specified in Regulation 45-106 respecting Prospectus Exemptions as in effect on the date of this Agreement.
“Superior Proposal” means any unsolicited bona fide written Acquisition Proposal from an
arms’ length third party or arms’ length third parties acting jointly to acquire not less than all of the outstanding Subordinate Voting Shares or all or substantially all of the assets of the Corporation on a consolidated basis that:
“Superior Proposal Notice” has the meaning specified
in Section 5.4(1)(c).
“SVS Shareholders” means the registered or beneficial holders of the Subordinate Voting
Shares, as the context requires.
“Tax Act” means the Income Tax Act (Canada).
“Tax Credits” has the meaning specified in Section (30)(f) of Schedule C.
“Tax Returns” means any and all returns, reports, declarations, elections, notices, forms, designations, schedules, attachments,
filings, and statements (including any amendments, and estimated tax returns and reports, withholding tax returns and reports, and information returns and reports) filed or required to be filed in respect of Taxes (whether in tangible,
electronic or other form).
“Taxes” means (i) any and all taxes, duties, fees, excises, premiums, assessments, imposts, levies and other charges or assessments
of any kind whatsoever imposed by any Governmental Entity, whether computed on a separate, consolidated, unitary, combined or other basis, including those levied on, or measured by, or described with respect to, income, gross receipts, profits,
gains, windfalls, capital, capital stock, production, recapture, transfer, land transfer, license, gift, occupation, wealth, environment, net worth, indebtedness, surplus, sales, goods and services, harmonized sales, use, value-added, excise,
special assessment, stamp, withholding, business, franchising, real or personal property, health, employee health, payroll, workers’ compensation, employment or unemployment, severance, social services, social security, education, utility,
surtaxes, customs, import or export, and including all license and registration fees and all employment insurance, health insurance and government pension plan premiums or contributions; (ii) all interest, penalties, fines, additions to tax or
other additional amounts imposed by any Governmental Entity on or in respect of amounts of the type described in clause (i) above or this clause (ii); (iii) any liability for the payment of any amounts of the type described in clauses (i) or
(ii) as a result of being a member of an affiliated, consolidated, combined or unitary group for any period; and (iv) any liability for the payment of any amounts of the type described in clauses (i) or (ii) as a result of any express or
implied obligation to indemnify any other Person or as a result of being a transferee or successor in interest to any party.
“Terminating Party” has the meaning specified in
Section 4.8(3).
“Termination Notice” has the meaning specified in
Section 4.8(3).
“TSX” means the Toronto Stock Exchange.
“U.S. Securities Laws” means the 1934 Exchange Act, the United States Securities Act of 1933, as amended and the rules and
regulations promulgated thereunder and any applicable state securities Laws.
“wilful breach” means a material breach that is a consequence of an act or a failure to act undertaken by the breaching party with
the actual knowledge that such act or failure to act would, or would be reasonably expected to, cause a breach of this Agreement.
In this Agreement, unless otherwise specified:
ARTICLE 2
THE ARRANGEMENT
The Corporation and the Purchaser agree that the Arrangement will be implemented in accordance with and subject to the terms and conditions of this Agreement and the Plan
of Arrangement.
Section 2.2
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Interim Order.
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As soon as reasonably practicable after the date of this Agreement, but in any event in sufficient time to permit the Meeting to be convened in accordance with Section
2.3(1), the Corporation shall apply in a manner reasonably acceptable to the Purchaser pursuant to Section 192 of the CBCA and, in cooperation with the Purchaser, prepare, file and diligently pursue an application for the Interim Order, which
must provide, among other things:
The Corporation shall:
Section 2.4
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The Circular and Schedule 13E-3.
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(5)
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The Purchaser hereby agrees to indemnify and save harmless the Corporation, its Subsidiaries and their respective Representatives from and against any and all liabilities, claims, demands, losses,
costs, damages and expenses to which the Corporation, any of its Subsidiaries or any of their respective Representatives may be subject or may suffer as a result of, or arising from, any Misrepresentation, alleged
Misrepresentation, untrue or allegedly untrue statement of a material fact, or material omission or alleged omission contained in any information included in the Circular or the Schedule 13E-3 that was provided in writing by or on
behalf of the Purchaser or its Representatives for inclusion in the Circular and the Schedule 13E-3 concerning the Purchaser, the Debt Financing Sources and the Debt Financing, including as a result of any order made, or any
inquiry, investigation or proceeding instituted by any Securities Authority or other Governmental Entity based on such a Misrepresentation, alleged Misrepresentation, untrue or allegedly untrue statement of a material fact, or
material omission or alleged omission.
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(6)
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Each Party shall promptly notify the other Parties if it becomes aware (in the case of the Purchaser, only in respect of information relating to the Purchaser, the Purchaser Parent, the Debt
Financing Sources and the Debt Financing) that the Circular or Schedule 13E-3 contain any Misrepresentation, untrue statement of a material fact, or omission to state a material fact necessary in order to make the statements made
therein, in light of the circumstances under which they were made, not misleading or otherwise require an amendment or supplement. The Parties shall cooperate in the preparation of any such amendment or supplement as required or
appropriate, and the Corporation shall promptly mail, file or otherwise publicly disseminate any such amendment or supplement to the Shareholders and, if required by the Court or by Law, file the same with the Securities
Authorities or any other Governmental Entity as required.
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If the Interim Order is obtained and the Arrangement Resolution is passed at the Meeting as provided for in the Interim Order, the Corporation shall take all steps
necessary or advisable to submit the Arrangement to the Court and diligently pursue an application for the Final Order pursuant to Section 192 of the CBCA, as soon as reasonably practicable and in any event no later than five Business Days
after the Arrangement Resolution is passed at the Meeting.
Section 2.6
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Court Proceedings.
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Subject to the terms of this Agreement, the Purchaser shall cooperate with, assist and consent to the Corporation seeking the Interim Order and the Final Order, including
by providing to the Corporation on a timely basis any information regarding the Purchaser, the Debt Financing Sources and the Debt Financing as required by applicable Law to be supplied by the Purchaser in connection therewith. In connection
with all Court proceedings relating to obtaining the Interim Order and the Final Order, the Corporation shall:
Section 2.7
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Incentive Compensation Plans.
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Section 2.8
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Articles of Arrangement and Effective Date.
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Section 2.9
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Corporation Employees
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Section 2.10
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Payment of Consideration.
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The Purchaser shall, following receipt of the Final Order and immediately prior to the filing by the Corporation of the Articles of Arrangement with the Director, transfer or cause to be
transferred to the Depositary sufficient funds to be held in escrow (the terms and conditions of such escrow to be satisfactory to the Corporation and the Purchaser, each acting reasonably) in order to satisfy the aggregate Consideration
payable to the SVS Shareholders (other than the holders of the Excluded Shares) as provided for in the Plan of Arrangement.
Section 2.11
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Withholding Rights.
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Each of the Purchaser, the Corporation, the Depositary or any other Person that makes a payment hereunder shall be entitled to deduct and withhold from the amounts
otherwise payable under this Agreement and the Arrangement (including any amounts payable pursuant to Section 2.7) to any Securityholder, such amounts as it is directed to deduct and withhold or is required to deduct and withhold with respect
to such payment under the Tax Act or any provision of any Law and remit such deduction and withholding amount to the appropriate Governmental Entity. To the extent that amounts are so properly deducted, withheld and remitted, such amounts shall
be treated for all purposes of this Agreement and the Arrangement as having been paid to the Securityholder in respect of which such deduction, withholding and remittance was made.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
Section 3.1
|
Representations and Warranties of the Corporation.
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The Purchaser and the Corporation shall use their commercially reasonable efforts to cause the Subordinate Voting Shares to be delisted from the TSX and the Nasdaq promptly,
with effect immediately following the acquisition by the Purchaser of the Subordinate Voting Shares pursuant to the Arrangement, and cause the deregistration of the Subordinate Voting Shares and suspension of the Corporation’s reporting
obligations under the 1934 Exchange Act as promptly as practicable thereafter.
If any provision of this Agreement is determined to be illegal, invalid or unenforceable by an arbitrator or any court of competent jurisdiction, that provision will be
severed from this Agreement and the remaining provisions shall remain in full force and effect. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced,
the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the
fullest extent possible.
Section 8.16
|
Governing Law.
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Section 8.17
|
Rules of Construction.
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The Parties to this Agreement waive the application of any Law or rule of construction providing that ambiguities in any agreement or other document shall be construed
against the Party drafting such agreement or other document.
Section 8.18
|
No Liability.
|
No director or officer of the Purchaser shall have any personal liability whatsoever to the Corporation under this Agreement or any other document delivered in connection
with the transactions contemplated hereby on behalf of the Purchaser. No director or officer of the Corporation or any of its Subsidiaries shall have any personal liability whatsoever to the Purchaser under this Agreement or any other document
delivered in connection with the transactions contemplated hereby on behalf of the Corporation or any of its Subsidiaries.
The Parties expressly acknowledge that they have requested that this Agreement and all ancillary and related documents thereto be drafted in the English language only. Les parties aux présentes reconnaissent avoir exigé que la présente entente et tous les documents qui y sont accessoires soient rédigés en anglais seulement.
Section 8.20
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Counterparts.
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This Agreement may be executed in any number of counterparts (including counterparts by facsimile) and all such counterparts taken together shall be deemed to constitute one and the same
instrument. The Parties shall be entitled to rely upon delivery of an executed facsimile or similar executed electronic copy of this Agreement, and such facsimile or similar executed electronic copy shall be legally effective to create a
valid and binding agreement between the Parties.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF the Parties have executed this Arrangement Agreement.
[Signature Page to Arrangement Agreement]
PLAN OF ARRANGEMENT
UNDER SECTION 192
OF THE CANADA BUSINESS CORPORATIONS ACT
ARTICLE 1.
INTERPRETATION
Unless indicated otherwise, where used in this Plan of Arrangement, capitalized terms used but not defined shall have the meanings specified in the Arrangement Agreement
and the following terms shall have the following meanings (and grammatical variations of such terms shall have corresponding meanings):
“Arrangement” means the arrangement under Section 192 of the CBCA in accordance with the terms and subject to the conditions set out
in this Plan of Arrangement, subject to any amendments or variations to this Plan of Arrangement made in accordance with the terms of the Arrangement Agreement or made at the direction of the Court in the Final Order with the prior consent of
the Corporation and the Purchaser, each acting reasonably.
“Arrangement Agreement” means the arrangement agreement dated June 7, 2021 among the Purchaser, the Corporation and G. Lamonde
Investissements Financiers Inc. (including the schedules thereto), as it may be amended, modified or supplemented from time to time in accordance with its terms.
“Arrangement Resolution” means the special resolution approving this Plan of Arrangement to be considered at the Meeting,
substantially in the form of Schedule B to the Arrangement Agreement.
“Articles of Arrangement” means the articles of arrangement of the Corporation in respect of the Arrangement, required by the CBCA
to be sent to the Director after the Final Order is made, which shall include the Plan of Arrangement and otherwise be in a form and content satisfactory to the Corporation and the Purchaser, each acting reasonably.
“Business Day” means any day of the year, other than a Saturday, Sunday or any day on which major banks are closed for business in
Montreal, Québec.
“CBCA” means the Canada Business Corporations Act.
“Certificate of Arrangement” means the certificate of arrangement to be issued by the Director pursuant to subsection 192(7) of the
CBCA in respect of the Articles of Arrangement.
“Circular” means the notice of the Meeting and accompanying management information circular, including all schedules, appendices and
exhibits thereto, to be sent to the Shareholders in connection with the Meeting, as amended, supplemented or otherwise modified from time to time in accordance with the terms of the Arrangement Agreement.
“Consideration” means $6.00 in cash per Subordinate Voting Share, without interest.
“Corporation” means EXFO Inc.
“Corporation DSUs” means the outstanding deferred stock units issued under the DSU Plan.
“Corporation PSUs” means the outstanding performance share units issued pursuant to the LTIP.
“Corporation RSUs” means the outstanding restricted stock units issued pursuant to the LTIP.
“Corporation SARs” means the outstanding stock appreciation rights issued pursuant to the SAR Plan.
“Court” means the Superior Court of Québec.
“Depositary” means AST Trust Company (Canada) in its capacity as depositary for the Arrangement, or such other person as the
Corporation and the Purchaser agree to engage as depositary for the Arrangement.
“Director” means the Director appointed pursuant to Section 260 of the CBCA.
“Dissent Rights” has the meaning specified in Section 3.1.
“Dissenting Holder” means a registered SVS Shareholder who has duly exercised its Dissent Rights and has not withdrawn or been
deemed to have withdrawn such exercise of Dissent Rights, but only in respect of the Subordinate Voting Shares in respect of which Dissent Rights are validly exercised by such holder.
“DSU Plan” means the deferred stock unit plan of the Corporation effective as of January 12, 2005 and amended as of January 10,
2018.
“Effective Date” means the date shown on the Certificate of Arrangement giving effect to the Arrangement.
“Effective Time” means 12:01 a.m. (Montreal time) on the Effective Date, or such other time as the parties agree to in writing
before the Effective Date.
“Final Order” means the final order of the Court in a form acceptable to the Corporation and the Purchaser, each acting reasonably,
approving the Arrangement, as such order may be amended by the Court (with the consent of both the Corporation and the Purchaser, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is
withdrawn or denied, as affirmed or as amended (provided that any such amendment is acceptable to both the Corporation and the Purchaser, each acting reasonably) on appeal.
“Governmental Entity” means (i) any international, multinational, national, federal, provincial, state, territorial, regional,
municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, commissioner, board, bureau, minister, ministry, governor in council, cabinet, agency or instrumentality,
domestic or foreign; (ii) any subdivision, agent or authority of any of the foregoing; (iii) any quasi-governmental or private body including any tribunal, commission, regulatory agency or self-regulatory organization exercising any regulatory,
expropriation or taxing authority under or for the account of any of the foregoing; or (iv) any Securities Authority or stock exchange, including the Toronto Stock Exchange and the Nasdaq Global Select Market.
“Interim Order” means the interim order of the Court in a form acceptable to the Corporation and the Purchaser, each acting
reasonably, providing for, among other things, the calling and holding of the Meeting, as such order may be amended by the Court with the consent of the Corporation and the Purchaser, each acting reasonably.
“Law” means, with respect to any Person, any and all applicable national, federal, provincial, state, municipal or local law
(statutory, civil, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgment, decree, ruling or other similar requirement, whether domestic or foreign, enacted, adopted, promulgated
or applied by a Governmental Entity that is binding upon or applicable to such Person or its business, undertaking, property or securities, and to the extent that they have the force of law, all policies, guidelines, notices and protocols of
any Governmental Entity, as amended.
“Letter of Transmittal” means the letter of transmittal sent to holders of Subordinate Voting Shares for
use in connection with the Arrangement.
“Lien” means any mortgage, charge, pledge, hypothec, security interest, prior claim, encroachment, option, right of first refusal or
first offer, occupancy right, restrictive covenant, assignment, lien (statutory or otherwise), defect of title or encumbrance of any kind.
“LTIP” means the long-term incentive plan of the Corporation dated as of May 25, 2000 and amended as of January 9, 2004, January 12,
2005, January 6, 2016, January 10, 2018 and January 9, 2019.
“Meeting” means the special meeting of Shareholders, including any adjournment or postponement of such special meeting in accordance
with the terms of the Arrangement Agreement, to be called and held in accordance with the Interim Order to consider the Arrangement Resolution and for any other purpose as may be set out in the Circular and agreed to in writing by the
Purchaser.
“Multiple Voting Shares” means the multiple voting shares in the capital of the Corporation.
“MVS Shareholders” means the registered or beneficial holders of the Multiple Voting Shares,
as the context requires.
“Parties” means the Corporation, the Purchaser and the Purchaser Parent and “Party” means
any one of them.
“Person” includes any individual, partnership, association, body corporate, organization, trust, estate, trustee, executor,
administrator, legal representative, government (including Governmental Entity), syndicate or other entity, whether or not having legal status.
“Plan of Arrangement” means this plan of arrangement proposed under Section 192 of the CBCA, and any amendments or variations made
in accordance with the terms of the Arrangement Agreement or made at the direction of the Court in the Final Order with the prior consent of the Corporation and the Purchaser, each acting reasonably.
“PSU Agreement” means an agreement evidencing the terms of any Corporation PSU.
“Purchaser” means 11172239 Canada Inc.
“RSU Agreement” means an agreement evidencing the terms of any Corporation RSU.
“SAR Plan” means the Stock Appreciation Rights Plan of the Corporation established on August 4, 2001 and amended as of January 12,
2010.
“Securities Authority” means the Autorité des marchés financiers (Québec), the United States Securities and Exchange Commission and
any other applicable securities commission or regulatory authority of a province or territory of Canada, the United States or any other jurisdiction with authority in respect of the Parties and/or the Subsidiaries.
“Securityholders” means, collectively, the Shareholders and the holders of Corporation DSUs, Corporation SARs, Corporation PSUs and
Corporation RSUs.
“Shareholders” means the SVS Shareholders and the MVS Shareholders.
“Subordinate Voting Shares” means the subordinate voting shares in the capital of the
Corporation.
“SVS Shareholders” means the registered or beneficial holders of the Subordinate Voting
Shares, as the context requires.
“Tax Act” means the Income Tax Act (Canada).
Section 1.2
|
Certain Rules of Interpretation.
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In this Plan of Arrangement, unless otherwise specified:
ARTICLE 2.
THE ARRANGEMENT
This Plan of Arrangement constitutes an arrangement under Section 192 of the CBCA and is made pursuant to, and is subject to the provisions of, the Arrangement Agreement.
Section 2.2
|
Binding Effect
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This Plan of Arrangement and the Arrangement, upon the filing of the Articles of Arrangement and the issuance of the Certificate of Arrangement, will become effective,
and be binding on the Corporation, the Purchaser, all Securityholders (including Dissenting Holders), any agent or transfer agent therefor and the Depositary at and after the Effective Time, without any further act or formality required on
the part of any Person, except as expressly provided in this Plan of Arrangement.
Pursuant to the Arrangement, each of the following events shall occur and shall be deemed to occur sequentially as set out below without any further authorization, act or
formality, in each case, unless stated otherwise, effective as at five minute intervals starting at the Effective Time:
ARTICLE 3.
DISSENT RIGHTS
Section 3.1
|
Dissent Rights
|
Section 3.2
|
Recognition of Dissenting Holders
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ARTICLE 6.
FURTHER ASSURANCES
Section 6.1
|
Further Assurances
|
Notwithstanding that the transactions and events set out in this Plan of Arrangement shall occur and shall be deemed to occur in the order set out in this Plan of
Arrangement without any further act or formality, each of the parties to the Arrangement Agreement shall make, do and execute, or cause to be made, done and executed, all such further acts, deeds, agreements, transfers, assurances, instruments
or documents as may reasonably be required by either of them in order to further document or evidence any of the transactions or events set out in this Plan of Arrangement.
ARRANGEMENT RESOLUTION
BE IT RESOLVED THAT:
REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
The Corporation is a corporation validly existing under the federal laws of Canada and has all requisite corporate power and authority to own, lease and operate its assets
and properties and conduct its business as now owned and conducted. The Corporation is duly qualified, licensed or registered to carry on business and is in good standing in each jurisdiction in which the character of its assets and properties,
owned, leased, licensed or otherwise held, or the nature of its activities makes such qualification, licensing or registration necessary, except as would not be reasonably expected to have, individually or in the aggregate, a Material Adverse
Effect.
The Corporation has the requisite corporate power and authority to enter into and perform its obligations under this Agreement. The execution and delivery and performance
by the Corporation of this Agreement and the consummation of the Arrangement and the other transactions contemplated by this Agreement have been duly authorized by all necessary corporate action on the part of the Corporation and no other
corporate proceedings on the part of the Corporation are necessary to authorize this Agreement or the consummation of the Arrangement and the other transactions contemplated hereby other than approval of the Circular and the Schedule 13E-3 and
calling of the Meeting by the Board, approval by the Shareholders in the manner required by the Interim Order and Law and approval by the Court.
This Agreement has been duly executed and delivered by the Corporation, and constitutes a legal, valid and binding agreement of the Corporation enforceable against it in
accordance with its terms subject only to any limitation on enforcement under Laws relating to (i) bankruptcy, winding-up, insolvency, reorganization, arrangement or other Law affecting the enforcement of creditors’ rights generally and
(ii) the discretion that a court may exercise in the granting of extraordinary remedies such as specific performance and injunction.
The execution, delivery and performance by the Corporation of this Agreement and the consummation by the Corporation of the Arrangement and the other transactions
contemplated hereby do not require any Authorization or other action by or in respect of, or filing, recording, registering or publication with, or notification to, any Governmental Entity by the
Corporation or by any of its Subsidiaries other than: (i) the Interim Order and any approvals required by the Interim Order; (ii) the Final Order; (iii) filings with the Director under the CBCA; (iv) compliance with Securities Laws and stock
exchange rules and policies; and (iv) any consents, waivers, approvals, actions or filings or notifications the absence of which would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
The execution, delivery and performance by the Corporation of this Agreement and the consummation of the Arrangement and the other transactions contemplated hereby do not
and will not (or would not with the giving of notice, the lapse of time or the happening of any other event or condition):
(a)
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contravene, conflict with, or result in any violation or breach of the Constating Documents of the Corporation or any of its Subsidiaries;
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(b)
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subject to the formalities described in (4) above, contravene, conflict with or result in a violation or breach of any Law in any material respect; or
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(c)
|
allow any Person to exercise any rights, require any consent or other action by any Person, or constitute a default under, or cause or permit the termination, cancellation,
acceleration or other change of any right or obligation or the loss of any benefit to which the Corporation or any of its Subsidiaries are entitled (including by triggering any rights of first refusal or first offer, change in control
provision or other restriction or limitation), or result in the creation or imposition of any Lien upon any of the Corporation’s material assets or the material assets of any of its Subsidiaries, under any Material Contract or any
material Authorization to which the Corporation or any of its Subsidiaries is a party or by which the Corporation or any of its Subsidiaries is bound.
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The Corporation is not a party to any shareholder, pooling, voting or other similar arrangement or agreement relating to the ownership or voting of any of the securities of the Corporation and has not adopted a
shareholder rights plan or any other similar plan or agreement.
The financial books, records and accounts of the Corporation and each of its Subsidiaries (i) have been maintained, in all material respects, in accordance with GAAP, (ii) accurately and fairly reflect, in all
material respects, all the material transactions, acquisitions and dispositions of the Corporation and its Subsidiaries, and (iii) accurately and fairly reflect, in all material respects, the basis for the Corporation’s financial statements.
PricewaterhouseCoopers LLP is and was, during the periods covered by its reports included in the Corporation Filings, independent within the meaning of the rules of professional conduct applicable to auditors in
Canada and any other applicable legislation or regulation. Further, PricewaterhouseCoopers LLP is and was, during the periods covered by its reports included in the Corporation Filings an independent accountant with respect to the Corporation
under the United States Securities Act of 1933, as amended, and applicable rules and regulations thereunder adopted by the Securities and Exchange Commission and the Public Company Accounting Oversight Board (United States). There has not
been any reportable event (within the meaning of Regulation 51-102 respecting Continuous Disclosure Obligations) with such auditors with respect to audits of Corporation and its Subsidiaries.
To the knowledge of the Corporation, as of the date hereof, there are no liabilities or obligations of the Corporation or any of its Subsidiaries, whether accrued, contingent, absolute, determined, determinable
or otherwise, other than liabilities or obligations: (i) disclosed in the Corporation Filings; (ii) incurred in the Ordinary Course since August 31, 2020; or (iii) incurred in connection with this Agreement; or (iv) [redacted: commercially
sensitive information].
Since September 1, 2020, except as disclosed in the Corporation Filings and other than the transactions contemplated in this Agreement, or as a result of or in response to COVID-19, the business of the
Corporation and its Subsidiaries has been conducted in the Ordinary Course and there has not been any event, circumstance or occurrence which has had, or which would reasonably be expected to have, a Material Adverse Effect.
The Corporation and each of its Subsidiaries is in compliance with Law in all material respects and neither the Corporation nor any of its Subsidiaries is, to the knowledge of the Corporation, under any
investigation with respect to, or, since August 31, 2019, has been charged with, or, to the knowledge of the Corporation, threatened to be charged with, or, to the knowledge of the Corporation, has received written notice of, any violation or
alleged violation of any Law in any material respect.
The Board and the Independent Committee have received the Fairness Opinion (a true and complete copy of which, when executed and delivered in writing, will be provided to the Purchaser) and the Fairness Opinion
has not been withdrawn or modified.
The Board and the Independent Committee have received the Formal Valuation (a true and complete copy of which, when executed and delivered in writing, will be provided to
the Purchaser) and the Formal Valuation has not been withdrawn or modified.
No investment banker, broker, finder, financial advisor or other intermediary has been retained by or is authorized to act on behalf of the Corporation or any of its Subsidiaries and is entitled to any fee,
commission or other payment from the Corporation or any of its Subsidiaries in connection with the Arrangement or any other transaction contemplated by this Agreement.
The Corporation and its Subsidiaries have valid, good and marketable title to all material personal or movable property of any kind or nature which the Corporation or any of its Subsidiaries purports to own, free
and clear of all Liens (other than Permitted Liens), except as would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect. The Corporation and its Subsidiaries, as lessees, have the right under
Contract to use, possess and control all personal or movable property leased by and material to the Corporation or any of its Subsidiaries as used, possessed and controlled by the Corporation or its Subsidiaries, as applicable, except as
would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
The operations of the Corporation and each of its Subsidiaries are and have been conducted at all times in compliance with money laundering Laws and any related or similar Laws relating to money laundering
(collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or Governmental Entity involving the Corporation or any of its Subsidiaries with respect to the Money
Laundering Laws is pending or, to the knowledge of the Corporation, threatened.
To the knowledge of the Corporation, neither the Corporation nor any of its Subsidiaries nor any of their respective Representatives has: (i) used or is using any corporate
funds for any illegal contributions, gifts, entertainment or other expenses relating to political activity that would be illegal; (ii) used or is using any corporate funds for any direct or indirect illegal payments to any foreign or domestic
governmental officers or employees; (iii) violated or is violating any provision of the Corruption of Foreign Public Officials Act (Canada) or the FCPA, (iv) has established or maintained, or is maintaining, any illegal fund of corporate monies
or other properties; (v) made any bribe, illegal rebate, illegal payoff, influence payment, kickback or other illegal payment of any nature; or (vi) has been subject to actual, pending, or threatened civil, criminal or administrative actions,
suits, demands, claims, hearings, written notices of violation, investigations, proceedings, demand letters, settlements or enforcement actions by, or made any voluntary disclosures to, any Governmental Authority relating to material violations
of applicable anti-corruption Laws. The Corporation has policies and procedures designed to reasonably ensure material compliance by the Corporation, its Subsidiaries and Representatives acting on behalf of the Corporation and its Subsidiaries
with applicable anti-corruption Laws.
The Corporation, its Subsidiaries and its Representatives are, and have been since August 31, 2019, in compliance with economic sanctions, anti-terrorism, customs and
export, anti-boycott and technology transfer control laws. Neither the Corporation nor any of its Subsidiaries, nor, to the Knowledge of the Corporation, any director, officer, agent, employee or affiliate of the Corporation or any of its
Subsidiaries: (i) is, or, to the extent the concept of ownership or control is applicable to such Person, is owned or controlled by, a person or entity subject to the sanctions administered by the Office of Foreign Assets Control of the U.S.
Department of the Treasury or included on the List of Specially Designated Nationals and Blocked Persons or Foreign Sanctions Evaders, Denied Persons List, Entities List, Debarred Parties List, Excluded Parties List and Terrorism Exclusion
List, or any other lists of known or suspected terrorists, terrorist organizations or other prohibited persons made publicly available or provided to the Corporation or any of its Subsidiaries by any Governmental Authority (such entities,
persons or organizations collectively, the “Restricted Parties”); or (ii) except as would not be, or would not reasonably be expected to be, individually or in the aggregate, material to the Company and
its Subsidiaries taken as a whole, has conducted any business with or engaged in any transaction or arrangement with or involving, directly or indirectly, any Restricted Parties or countries subject to economic or trade sanctions imposed by
Canada or the United States, in violation of applicable Law, or has otherwise been in violation of any such sanctions, restrictions or any similar Law. The Corporation and its Subsidiaries have instituted and maintain policies and procedures
designed to ensure continued compliance with such Laws.
The Corporation has sufficient funds available to pay the Corporation Termination Fee.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
(1)
|
Organization and Qualification.
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The Purchaser is a corporation duly incorporated, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite power and authority to own, lease and operate
its assets and properties and conduct its business as now owned and conducted.
The Purchaser has the requisite corporate power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance by the Purchaser of its obligations under this
Agreement and the consummation of the Arrangement and the other transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Purchaser and no other corporate proceedings on the part of the
Purchaser are necessary to authorize this Agreement or the consummation of the Arrangement and the other transactions contemplated hereby.
This Agreement has been duly executed and delivered by the Purchaser and constitutes a legal, valid and binding agreement of the Purchaser enforceable against the Purchaser in accordance with its terms subject
only to any limitation on enforcement under Laws relating to (i) bankruptcy, winding-up, insolvency, reorganization, arrangement or other Law affecting the enforcement of creditors’ rights generally and (ii) the discretion that a court may
exercise in the granting of extraordinary remedies such as specific performance and injunction.
The execution, delivery and performance by the Purchaser of its obligations under this Agreement and the consummation by the Purchaser of the Arrangement and the transactions contemplated hereby do not require
any Authorization or other action by or in respect of, or filing with, or notification to, any Governmental Entity by the Purchaser other than: (i) the Interim Order and any approvals required by the Interim Order; (ii) the Final Order; (iii)
filings with the Director under the CBCA; (iv) compliance with Securities Laws and stock exchange rules and policies; and (vi) any consents, waivers, approvals, actions or filings or notifications the absence of which would not, individually
or in the aggregate, materially impede the ability of the Purchaser to consummate the Arrangement and the transactions contemplated hereby. No filings are required under the Competition Act or HSR Act because the Purchaser currently controls
the Corporation for purposes of the Competition Act and HSR Act.
The execution, delivery and performance by the Purchaser of its obligations under this Agreement and the consummation of the Arrangement and the transactions contemplated hereby do not and will not (or would not
with the giving of notice, the lapse of time or the happening of any other event or condition):
There are no claims, actions, suits, arbitrations, inquiries, investigations or proceedings pending, or, to the knowledge of the Purchaser threatened, against or relating
to the Purchaser before any Governmental Entity nor is the Purchaser subject to any outstanding judgment, order, writ, injunction or decree that, either individually or in the aggregate, is reasonably likely to prevent or materially delay
consummation of the Arrangement or the transactions contemplated hereby.
As of the date of this Agreement, the Purchaser and/or its associates and affiliates own the following Subordinate Voting Shares and Multiple Voting Shares of the
Corporation:
The authorized share capital of the Purchaser consists of an unlimited number of multiple voting shares and an unlimited number of subordinate voting shares. As of the date
of this Agreement, 100 multiple voting shares in the share capital of the Purchaser are issued and outstanding and are registered in the name of, and beneficially owned by, G. Lamonde.
The Purchaser does not have any operations, assets or liabilities, other than pursuant to this Agreement, the Debt Commitment Letters and the D&O Support and Voting
Agreements.
Prior to the execution and delivery of this Agreement, the Purchaser has delivered to the Corporation true and complete copies of the Debt Commitment Letters, and no
amendment or modification is contemplated as of the date hereof other than as permitted by Section 4.6. Each of the Debt Commitment Letters is in full force and effect and is a legal, valid and binding obligation of the Purchaser and, to the
knowledge of the Purchaser, the Debt Financing Sources (as applicable), subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally
or principles of equity (whether considered in a proceeding in equity or at law), and; as of the date hereof, no event occurred which, with or without notice, lapse of time or both, would constitute a default or breach on the part of the
Purchaser or the Debt Funding Parties under the Debt Commitment Letters. The commitments described in the Debt Commitment Letters are not subject to any condition precedent other than the conditions
expressly set forth therein. As of the date hereof, assuming the accuracy of the representations and warranties set forth in Schedule C to the extent necessary to satisfy the condition in Section 6.2(1) and performance by the Corporation of its
obligations under this Agreement, the Purchaser has no reason to believe that it will be unable to satisfy on a timely basis any term or condition of closing of the Debt Financing to be satisfied by it contained in the Debt Commitment Letters
for the Debt Financing to be available on the Effective Date and is not aware of any fact, occurrence or condition that may cause such Debt Financing to terminate or be ineffective or any of the terms or conditions of closing of such Debt
Financing not being capable of being met. Assuming the Debt Financing is funded in accordance with the Debt Commitment Letters, the accuracy of the representations and warranties set forth in Schedule C to the extent necessary to satisfy the
condition in Section 6.2(1) and performance by the Corporation of its obligations under this Agreement, the net proceeds of the Debt Financing will in the aggregate be sufficient for the Purchaser to pay the aggregate Consideration to be paid
pursuant to the Arrangement to the SVS Shareholders (other than the holders of the Excluded Shares), all related fees and expenses on the Effective Date and any other amount to be paid by the Purchaser under this Agreement in connection with
the consummation of the transaction contemplated by this Agreement and the Plan of Arrangement.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER PARENT
(1)
|
Organization and Qualification.
|
The Purchaser Parent is a corporation duly incorporated, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite power and authority to own, lease and
operate its assets and properties and conduct its business as now owned and conducted.
The Purchaser Parent has the requisite corporate power and authority to enter into and perform its obligations under this Agreement. The execution, delivery and performance by the Purchaser Parent of its
obligations under this Agreement and the consummation of the Arrangement and the other transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of the Purchaser Parent and no other corporate
proceedings on the part of the Purchaser Parent are necessary to authorize this Agreement or the consummation of the Arrangement and the other transactions contemplated hereby.
This Agreement has been duly executed and delivered by the Purchaser Parent and constitutes a legal, valid and binding agreement of the Purchaser Parent enforceable against the Purchaser Parent in accordance with
its terms subject only to any limitation on enforcement under Laws relating to (i) bankruptcy, winding-up, insolvency, reorganization, arrangement or other Law affecting the enforcement of creditors’ rights generally and (ii) the discretion
that a court may exercise in the granting of extraordinary remedies such as specific performance and injunction.
The execution, delivery and performance by the Purchaser Parent of its obligations under this Agreement and the consummation of the Arrangement and the transactions contemplated hereby do not and will not (or
would not with the giving of notice, the lapse of time or the happening of any other event or condition):
The Purchaser Parent has sufficient funds available to pay the Purchaser Termination Fee and to perform any other obligation as set forth in this Agreement.
FORM OF D&O SUPPORT AND VOTING AGREEMENT
See attached document.
[●], 2021
[●]
Dear Sirs/Mesdames:
Re: Support
and Voting Agreement
The undersigned understands that 11172239 Canada Inc. (the “Purchaser”) and EXFO Inc. (the “Corporation”)
and G. Lamonde Investissements Financiers Inc. (the “Purchaser Parent”) wish to enter into an arrangement agreement dated as of the date hereof (the “Arrangement Agreement”) contemplating an arrangement (the “Arrangement”) of the Corporation under Section 192 of the Canada Business
Corporations Act, the result of which shall be the acquisition by the Purchaser of all the outstanding subordinate voting shares (the “Subordinate Voting Shares”) of the Corporation not already
owned by the Purchaser or any of its affiliates. The undersigned is the beneficial owner of the securities set forth on the signature page hereof (collectively, the “Subject Securities”).
All capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to them in the Arrangement Agreement.
The undersigned hereby agrees, in his or her capacity as shareholder and not in his or her capacity as an officer or director of the Corporation, from the date hereof until
the date the Arrangement Agreement is terminated in accordance with its terms:
Notwithstanding any provision of this letter agreement to the contrary, the undersigned shall not be limited or restricted in any way whatsoever in the exercise of his or
her fiduciary duties as a director or officer, as applicable, of the Corporation.
The undersigned hereby represents and warrants that:
This letter agreement shall automatically terminate upon the termination of the Arrangement Agreement in accordance with its terms.
This letter agreement shall be governed by, construed and enforced in accordance with, the laws of the Province of Québec and the federal laws of Canada applicable therein.
This letter agreement may be executed and delivered in multiple counterparts (including by facsimile, email or other electronic means), each of which shall be deemed an
original, and such counterparts together shall constitute one and the same agreement.
The Parties expressly acknowledge that they have requested that this letter agreement be drafted in the English language only. Les
parties aux présentes reconnaissent avoir exigé que la présente lettre d'entente soit rédigée en anglais seulement.
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Please confirm your agreement with the foregoing by signing and returning a copy of this letter agreement to the undersigned.
Accepted and agreed this _______________day of ________________________, 2021
[●]
Per: _____________________________________________
Name:
Title: