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Exhibit 99.7
SCHEDULE H
SUPPORT AGREEMENT
MEMORANDUM OF AGREEMENT made as of the - day of - , 2000.
AMONG:
VIVENDI S.A.,
a corporation existing under the laws of France
(hereinafter referred to as "VIVENDI", as such term is modified in
section 1.1 of the Merger Agreement),
-and -
3045479 NOVA SCOTIA COMPANY,
an unlimited liability company existing under the laws of Nova
Scotia
(hereinafter referred to as "VIVENDI HOLDINGS"),
- and -
3744531 CANADA INC.,
a corporation existing under the laws of Canada
(hereinafter referred to as "VIVENDI EXCHANGECO"),
WHEREAS in connection with a merger agreement (the "MERGER AGREEMENT")
made as of June 19, 2000 among Vivendi (by a predecessor corporation), Seagram
and the other parties thereto, Vivendi Exchangeco is to issue exchangeable
shares (the "EXCHANGEABLE SHARES") to certain holders of securities of Seagram
under the plan of arrangement (the "ARRANGEMENT") contemplated by the Merger
Agreement;
AND WHEREAS under the Merger Agreement Vivendi, Vivendi Holdings and
Vivendi Exchangeco are required to execute a support agreement substantially in
the form of this Agreement;
NOW THEREFORE in consideration of the foregoing and the mutual agreements
contained herein and for other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the parties agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 DEFINED TERMS
Each term denoted herein by initial capital letters and not otherwise
defined herein shall have the meaning ascribed thereto in the rights,
privileges, restrictions and conditions
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(collectively, the "SHARE PROVISIONS") attaching to the Exchangeable Shares
attached as Appendix 1 to the Plan of Arrangement as set out in the Articles of
Arrangement of Seagram, unless the context requires otherwise.
1.2 INTERPRETATION NOT AFFECTED BY HEADINGS
The division of this Agreement into Articles, sections and other portions
and the insertion of headings are for convenience of reference only and shall
not affect the construction or interpretation of this Agreement. Unless
otherwise indicated, all references to an "Article" or "section" followed by a
number and/or a letter refer to the specified Article or section of this
Agreement. The terms "this Agreement", "hereof", "herein" and "hereunder" and
similar expressions refer to this Agreement and not to any particular Article,
section or other portion hereof and include any agreement or instrument
supplementary or ancillary hereto.
1.3 NUMBER, GENDER
Words importing the singular number only shall include the plural and vice
versa. Words importing any gender shall include all genders.
1.4 DATE FOR ANY ACTION
If any date on which any action is required to be taken under this
Agreement is not a Business Day, such action shall be required to be taken on
the next succeeding Business Day. For the purposes of this Agreement, a
"BUSINESS DAY" means any day on which commercial banks are generally open for
business in Toronto, Ontario, New York City, New York and France, other than a
Saturday, a Sunday or a day observed as a holiday in Toronto, Ontario, New York
City, New York or France under applicable laws.
ARTICLE 2
COVENANTS OF VIVENDI
2.1 COVENANTS REGARDING EXCHANGEABLE SHARES
So long as any Exchangeable Shares not owned by Vivendi or its affiliates
are outstanding, Vivendi will:
(a) not take any action that will result in the declaration or payment
of any dividend or other distribution on the Vivendi ADSs unless (i)
Vivendi Exchangeco shall simultaneously declare or pay, as the case
may be, a dividend or other distribution equivalent thereto (as
provided for in the Share Provisions) on the Exchangeable Shares and
Vivendi Exchangeco shall have sufficient money or other assets or
authorized but unissued securities available to enable the due
declaration and the due and punctual payment, in accordance with
applicable law, of any such dividend or other distribution on the
Exchangeable Shares, or (ii) if the dividend or other distribution
is a stock dividend or distribution of stock, in lieu of such
dividend Vivendi Exchangeco effects a corresponding and
contemporaneous and economically equivalent (as determined in
accordance with section 2.7(d)) subdivision of the outstanding
Exchangeable Shares and Vivendi Exchangeco
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shall have sufficient authorized but unissued securities available
to enable the subdivision;
(b) advise Vivendi Exchangeco sufficiently in advance of the declaration
by Vivendi of any dividend or other distribution on Vivendi ADSs and
take all such other actions as are reasonably necessary, in
co-operation with Vivendi Exchangeco, to ensure that (i) the
respective declaration date, record date and payment date for a
dividend or other distribution on the Exchangeable Shares shall be
the same as the declaration date, record date and payment date for
such dividend or other distribution on the Vivendi ADSs, or (ii) the
record date, if any, and effective date for the subdivision referred
to in section 2.1(a) shall be the same as the record date and
payment date for such dividend or other distribution on the Vivendi
ADSs;
(c) ensure that the record date for any dividend or other distribution
declared on the Vivendi ADSs is not less than 10 Business Days after
the declaration date of such dividend or other distribution;
(d) take all such actions and do all such things as are reasonably
necessary or desirable to enable and permit Vivendi Exchangeco, in
accordance with applicable law, to pay and otherwise perform its
obligations with respect to the satisfaction of the Liquidation
Amount, the Retraction Price or the Redemption Price in respect of
each issued and outstanding Exchangeable Share (other than
Exchangeable Shares owned by Vivendi or its affiliates) upon the
liquidation, dissolution or winding-up of Vivendi Exchangeco or any
other distribution of the assets of Vivendi Exchangeco among its
shareholders for the purpose of winding up its affairs, the delivery
of a Retraction Request by a holder of Exchangeable Shares or a
redemption of Exchangeable Shares by Vivendi Exchangeco, as the case
may be, including without limitation all such actions and all such
things as are necessary or desirable to enable and permit Vivendi
Exchangeco to cause to be delivered Vivendi ADSs to the holders of
Exchangeable Shares in accordance with the provisions of Article 5,
6 or 7, as the case may be, of the Share Provisions;
(e) take all such actions and do all such things as are reasonably
necessary or desirable to enable and permit Vivendi Holdings, in
accordance with applicable law, to perform its obligations arising
upon the exercise of the Liquidation Call Right, the Retraction Call
Right or the Redemption Call Right, including without limitation all
such actions and all such things as are necessary or desirable to
enable and permit Vivendi Holdings to deliver or to cause to be
delivered Vivendi ADSs to the holders of Exchangeable Shares in
accordance with the provisions of the Liquidation Call Right, the
Retraction Call Right or the Redemption Call Right, as the case may
be, and cash in respect of declared and unpaid dividends; and
(f) not (and will ensure that Vivendi Holdings or any of its affiliates
does not) exercise its vote as a shareholder to initiate the
voluntary liquidation, dissolution or winding up of Vivendi
Exchangeco or any other distribution of the assets of Vivendi
Exchangeco among its shareholders for the purpose of winding up its
affairs nor take any action or omit to take any action (and Vivendi
will not permit Vivendi Holdings or any of its affiliates to take
any action or omit to take any action) that is designed to result in
the liquidation, dissolution or winding up of
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Vivendi Exchangeco or any other distribution of the assets of
Vivendi Exchangeco among its shareholders for the purpose of winding
up its affairs.
2.2 SEGREGATION OF FUNDS
Vivendi will cause Vivendi Exchangeco to deposit a sufficient amount of
funds in a separate account of Vivendi Exchangeco and segregate a sufficient
amount of such other assets and property as is necessary to enable Vivendi
Exchangeco to pay dividends or other distributions when due and to pay or
otherwise satisfy its respective obligations under Article 5, 6 or 7 of the
Share Provisions, as applicable.
2.3 VIVENDI ADSS
Vivendi hereby represents, warrants and covenants in favour of Vivendi
Exchangeco and Vivendi Holdings that Vivendi has issued and/or reserved for
issuance free from preemptive and other rights such number of Vivendi ADSs (or
securities redeemable into such number of Vivendi ADSs), or if the Vivendi ADSs
are reclassified or changed into other securities as contemplated by section
2.7, it will issue and/or reserve for issuance such number of other securities
(or securities convertible into such number of other securities), as is equal to
the number of Exchangeable Shares issued and outstanding from time to time so as
to enable and permit Vivendi Holdings to meet its obligations under each of the
Liquidation Call Right, the Retraction Call Right and the Redemption Call Right,
with respect to the transfer and delivery of Vivendi ADSs and to enable and
permit Vivendi Exchangeco to meet its respective obligations hereunder, under
the Exchange Trust Agreement and under the Share Provisions.
2.4 NOTIFICATION OF CERTAIN EVENTS
In order to assist Vivendi to comply with its obligations hereunder and to
permit Vivendi Holdings to exercise the Liquidation Call Right, the Retraction
Call Right and the Redemption Call Right, Vivendi Exchangeco will notify Vivendi
and Vivendi Holdings of each of the following events at the time set forth
below:
(a) in the event of any determination by the Board of Directors of
Vivendi Exchangeco to institute voluntary liquidation, dissolution
or winding-up proceedings with respect to Vivendi Exchangeco or to
effect any other distribution of the assets of Vivendi Exchangeco
among its shareholders for the purpose of winding up its affairs, at
least 60 days before the proposed effective date of such
liquidation, dissolution, winding-up or other distribution;
(b) promptly, upon the earlier of receipt by Vivendi Exchangeco of
notice of and Vivendi Exchangeco otherwise becoming aware of any
threatened or instituted claim, suit, petition or other proceedings
with respect to the involuntary liquidation, dissolution or
winding-up of Vivendi Exchangeco or to effect any other distribution
of the assets of Vivendi Exchangeco among its shareholders for the
purpose of winding up its affairs;
(c) immediately, upon receipt by Vivendi Exchangeco of a Retraction
Request;
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(d) on the same date on which notice of redemption is given to holders
of Exchangeable Shares, upon the determination of a Redemption Date
in accordance with the Share Provisions; and
(e) as soon as practicable upon the issuance by Vivendi Exchangeco of
any Exchangeable Shares or rights to acquire Exchangeable Shares
(other than the issuance of Exchangeable Shares and rights to
acquire Exchangeable Shares in exchange for outstanding Seagram
Common Shares under the Arrangement).
2.5 DELIVERY OF VIVENDI ADSS TO VIVENDI EXCHANGECO AND VIVENDI HOLDINGS
In furtherance of its obligations under sections 2.1(d) and (e), upon
notice from Vivendi Exchangeco or Vivendi Holdings of any event that requires
Vivendi Exchangeco or Vivendi Holdings to cause to be delivered Vivendi ADSs to
any holder of Exchangeable Shares, Vivendi shall forthwith issue and deliver or
cause to be delivered to Vivendi Exchangeco or Vivendi Holdings (unless Vivendi
Exchangeco or Vivendi Holdings already has sufficient Vivendi ADSs) the
requisite number of Vivendi ADSs to be received by and issued to, or to the
order of, the former holder of the surrendered Exchangeable Shares, as Vivendi
Exchangeco or Vivendi Holdings shall direct. All such Vivendi ADSs shall be duly
authorized and validly issued as fully paid and non-assessable and shall be free
and clear of any lien, claim or encumbrance.
2.6 QUALIFICATION OF VIVENDI ADSS
If any Vivendi ADSs (or other securities into which Vivendi ADSs may be
reclassified or changed as contemplated by section 2.7) to be issued and
delivered hereunder require registration or qualification with or approval of or
the filing of any document, including any prospectus or similar document or the
taking of any proceeding with or the obtaining of any order, ruling or consent
from any governmental or regulatory authority under any French, Canadian or
United States federal, provincial, state, territorial securities or other law or
regulation or under the rules and regulations of any securities or other
regulatory authority or the fulfillment of any other French, United States or
Canadian legal requirement before such securities (or such other securities) may
be issued and delivered to the holder of surrendered Exchangeable Shares or in
order that such securities (or such other securities) may be freely traded
thereafter (other than any restrictions of general application on transfer by
reason of a holder being a "control person" of Vivendi for purposes of Canadian
provincial or territorial securities laws or an "affiliate" of Vivendi for
purposes of United States federal or state securities law or the equivalent
thereof under applicable French laws or stock exchange or regulatory
requirements), Vivendi will in good faith expeditiously take all such actions
and do all such things as are necessary or desirable to cause such Vivendi ADSs
(or such other securities) to be and remain duly registered, qualified or
approved under French, United States and/or Canadian laws, as the case may be.
Vivendi will in good faith expeditiously take all such actions and do all such
things as are reasonably necessary or desirable to cause all Vivendi ADSs (or
such other shares or securities) to be delivered hereunder to be listed, quoted
or posted for trading on all stock exchanges and quotation systems on which
outstanding Vivendi ADSs (or such other shares or securities) have been listed
by Vivendi and remain listed and are quoted or posted for trading at such time.
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2.7 ECONOMIC EQUIVALENCE
So long as any Exchangeable Shares not owned by Vivendi or its affiliates
are outstanding:
(a) Vivendi will not without prior approval of Vivendi Exchangeco and
the prior approval of the holders of the Exchangeable Shares given
in accordance with section 10.2 of the Share Provisions:
(i) issue or distribute Vivendi ADSs (or securities exchangeable
for or convertible into or carrying rights to acquire Vivendi
ADSs) to the holders of all or substantially all of the then
outstanding Vivendi ADSs by way of stock dividend or other
distribution, other than an issue of Vivendi ADSs (or
securities exchangeable for or convertible into or carrying
rights to acquire Vivendi ADSs) to holders of Vivendi ADSs who
exercise an option to receive dividends in Vivendi ADSs (or
securities exchangeable for or convertible into or carrying
rights to acquire Vivendi ADSs) in lieu of receiving cash
dividends;
(ii) issue or distribute rights, options or warrants to the holders
of all or substantially all of the then outstanding Vivendi
ADSs entitling them to subscribe for or to purchase Vivendi
ADSs (or securities exchangeable for or convertible into or
carrying rights to acquire Vivendi ADSs); or
(iii) issue or distribute to the holders of all or substantially all
of the then outstanding Vivendi ADSs (A) securities of Vivendi
of any class other than Vivendi ADSs (other than securities
convertible into or exchangeable for or carrying rights to
acquire Vivendi ADSs), (B) rights, options or warrants other
than those referred to in section 2.7(a)(ii), (C) evidences of
indebtedness of Vivendi or (D) assets of Vivendi,
unless the economic equivalent of such rights, options,
securities, shares, evidences of indebtedness or other assets
is (A) issued or distributed or otherwise provided
simultaneously to, or (B) effected pursuant to section 11.3 of
the Share Provisions for, holders of the Exchangeable Shares
after giving effect to the Share Provisions; provided that,
for greater certainty, the above restrictions shall not apply
to any securities issued or distributed by Vivendi in order to
give effect to and to consummate the transactions contemplated
by, and in accordance with, the Merger Agreement.
(b) Vivendi will not without the prior approval of Vivendi Exchangeco
and the prior approval of the holders of the Exchangeable Shares
given in accordance with section 10.2 of the Share Provisions:
(i) subdivide, redivide or change the then outstanding Vivendi
ADSs into a greater number of Vivendi ADSs (except as
contemplated in the Merger Agreement); or
(ii) reduce, combine, consolidate or change the then outstanding
Vivendi ADSs, into a lesser number of Vivendi ADSs; or
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(iii) reclassify or otherwise change the Vivendi ADSs or effect an
amalgamation, merger, reorganization or other transaction
affecting Vivendi ADSs,
unless an economically equivalent change shall simultaneously
be made to, or in the rights of the holders of, the
Exchangeable Shares; provided, however, that, for greater
certainty, the above restrictions shall not apply to any
securities issued or distributed by Vivendi in order to give
effect to and to consummate the transactions contemplated by,
and in accordance with, the Merger Agreement.
(c) Vivendi will ensure that the record date for any event referred to
in section 2.7(a) or 2.7(b), or (if no record date is applicable for
such event) the effective date for any such event, is not less than
five Business Days after the date on which such event is declared or
announced by Vivendi (with contemporaneous notification thereof by
Vivendi to Vivendi Exchangeco).
(d) The Board of Directors of Vivendi Exchangeco shall determine, in
good faith and in its sole discretion, economic equivalence for the
purposes of any event referred to in section 2.7(a) or 2.7(b) and
each such determination shall be conclusive and binding on Vivendi.
In making each such determination, the following factors shall,
without excluding other factors determined by the Board of Directors
of Vivendi Exchangeco to be relevant, be considered by the Board of
Directors of Vivendi Exchangeco:
(i) in the case of any stock dividend or other distribution
payable in Vivendi ADSs, the number of Vivendi ADSs issued as
a result of such stock dividend or other distribution in
proportion to the number of Vivendi ADSs previously
outstanding;
(ii) in the case of the issuance or distribution of any rights,
options or warrants to subscribe for or purchase Vivendi ADSs
(or securities exchangeable for or convertible into or
carrying rights to acquire Vivendi ADSs), the relationship
between the exercise price of each such right, option or
warrant, the number of such rights, options or warrants to be
issued or distributed in respect of each Vivendi ADS and the
Current Market Price of a Vivendi ADS;
(iii) in the case of the issuance or distribution of any other form
of property (including without limitation any shares or
securities of Vivendi of any class other than Vivendi ADSs,
any rights, options or warrants other than those referred to
in section 2.7(d)(ii), any evidences of indebtedness of
Vivendi or any assets of Vivendi), the relationship between
the fair market value (as determined by the Board of Directors
of Vivendi Exchangeco in the manner above contemplated) of
such property to be issued or distributed with respect to each
outstanding Vivendi ADS and the Current Market Price of a
Vivendi ADS;
(iv) in the case of any subdivision, redivision or change of the
then outstanding Vivendi ADSs into a greater number of Vivendi
ADSs or the reduction, combination, consolidation or change of
the then outstanding Vivendi ADSs into a lesser number of
Vivendi ADSs or any amalgamation, merger,
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reorganization or other transaction affecting Vivendi ADSs,
the effect thereof upon the then outstanding Vivendi ADSs; and
(v) in all such cases, the general taxation consequences of the
relevant event to owners of Exchangeable Shares to the extent
that such consequences may differ from the taxation
consequences to such holders determined as if they had held
Vivendi ADSs at the relevant time as a result of differing tax
treatment under the laws of Canada, the United States and
France (except for any differing consequences arising as a
result of differing marginal taxation rates and without regard
to the individual circumstances of owners of Exchangeable
Shares); and
(vi) to take into account the then current Vivendi ADS Adjustment
Ratio (except in respect of a cash dividend referred to in
section 3.1(a) of the Share Provisions) and any rights under
the Vivendi Voting Rights;
(e) Vivendi Exchangeco agrees that, to the extent required, upon due
notice from Vivendi, Vivendi Exchangeco will use its best efforts to
take or cause to be taken such steps as may be necessary for the
purposes of ensuring that appropriate dividends are paid or other
distributions are made by Vivendi Exchangeco, or subdivisions,
redivisions or changes are made to the Exchangeable Shares, in order
to implement the required economic equivalent with respect to the
Vivendi ADSs and Exchangeable Shares as provided for in this section
2.7.
(f) Vivendi agrees that its board of directors will not propose to
Vivendi's shareholders the liquidation of Vivendi such that an
amount may become payable in respect of the Vivendi Voting Rights.
2.8 TENDER OFFERS
For so long as Exchangeable Shares remain outstanding (not including
Exchangeable Shares held by Vivendi and its affiliates):
(a) No tender offer, share exchange offer, take-over bid or similar
transaction with respect to Vivendi ADSs or Vivendi Shares (an "OFFER")
will be proposed or recommended by Vivendi or the Board of Directors of
Vivendi or otherwise effected with the consent or approval of the Board of
Directors of Vivendi unless the holders of Exchangeable Shares (other than
Vivendi and its affiliates) participate in such Offer to the same extent
and on an economically equivalent basis as the holders of Vivendi ADSs,
without discrimination. Without limiting the generality of the foregoing,
neither Vivendi nor the Board of Directors of Vivendi will approve or
recommend any Offer or take any action in furtherance of an Offer unless
the holders of Exchangeable Shares may participate in such Offer without
being required to retract Exchangeable Shares as against Vivendi
Exchangeco.
(b) No issuer bid or similar transaction for outstanding Vivendi
ADSs or Vivendi Shares shall be proposed or recommended by Vivendi or the
Board of Directors of Vivendi or otherwise effected with the consent or
the approval of the Board of Directors of Vivendi unless a substantially
contemporaneous take-over bid (the "Bid") is made by Vivendi Holdings for
an equivalent percentage of the outstanding Exchangeable Shares (other
than those held by Vivendi and its affiliates) on the same
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or economically equivalent terms. Without limiting the generality of the
foregoing, neither Vivendi nor the Board of Directors of Vivendi will
approve or recommend any Bid or take any action in furtherance of a Bid
unless the holders of Exchangeable Shares may participate in such Bid
without being required to retract Exchangeable Shares as against Vivendi
Exchangeco.
2.9 OWNERSHIP OF OUTSTANDING SHARES
Vivendi covenants and agrees in favour of Vivendi Exchangeco that, without
the prior approval of Vivendi Exchangeco and the prior approval of the holders
of the Exchangeable Shares given in accordance with section 10.2 of the Share
Provisions, as long as any outstanding Exchangeable Shares are owned by any
Person other than Vivendi or any of its affiliates, Vivendi will be and remain
the direct and/or indirect beneficial owner of all issued and outstanding voting
shares in the capital of Vivendi Exchangeco and Vivendi Holdings.
2.10 VIVENDI AND AFFILIATES NOT TO VOTE EXCHANGEABLE SHARES
Vivendi covenants and agrees that it will appoint and cause to be
appointed proxyholders with respect to all Exchangeable Shares held by it and
its affiliates for the sole purpose of attending each meeting of holders of
Exchangeable Shares in order to be counted as part of the quorum for each such
meeting. Vivendi further covenants and agrees that it will not, and will cause
its affiliates not to, exercise any voting rights which may be exercisable by
holders of Exchangeable Shares from time to time under the Share Provisions or
under the provisions of the CBCA (or any successor or other corporate statute by
which Vivendi Exchangeco may in the future be governed) with respect to any
Exchangeable Shares held by it or by its affiliates in respect of any matter
considered at any meeting of holders of Exchangeable Shares.
2.11 ORDINARY MARKET PURCHASES
For greater certainty, nothing contained in this Agreement, including
without limitation the obligations of Vivendi contained in section 2.8, shall
limit the ability of Vivendi or its affiliates to make a "Rule 10b-18 Purchase"
of Vivendi ADSs or Vivendi Shares under Rule 10b-18 of the United States
Securities Exchange Act of 1934, as amended or to make ordinary market purchases
of Vivendi ADSs or Vivendi Shares in accordance with applicable laws and
regulatory or stock exchange requirements.
2.12 STOCK EXCHANGE LISTING
Vivendi covenants and agrees in favour of Vivendi Exchangeco that, as long
as any outstanding Exchangeable Shares are owned by any Person other than
Vivendi or any of its affiliates, Vivendi will use its reasonable best efforts
to maintain a listing for such Exchangeable Shares on a Canadian stock exchange
which is a prescribed stock exchange with the meaning of the Income Tax Act
(Canada) and to ensure that Vivendi Exchangeco remains a "public corporation"
within the meaning of the Income Tax Act (Canada).
2.13 DELIVERY OF VIVENDI ADSS TO SEAGRAM
In the event that Vivendi determines pursuant to section 2.2 of the Plan
of Arrangement that a Replacement Option or Replacement SAR (each as defined in
the Plan of Arrangement) is to be an obligation of Seagram, upon notice from
Seagram of any event that
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requires Seagram to deliver or cause to be delivered Vivendi ADSs to any holder
of a Replacement Option or Replacement SAR, Vivendi shall forthwith issue and
deliver or cause to be delivered to Seagram (unless Seagram already has
sufficient Vivendi ADSs) the requisite number of Vivendi ADSs to be received by
and issued to, or to the order of, the former holder of the exercised
Replacement Option or Replacement SAR, as Seagram shall direct. All such Vivendi
ADSs shall be duly authorized and validly issued as fully paid and
non-assessable and shall be free and clear of any lien, claim or encumbrance.
For the purposes of this section 2.13, Vivendi Holdings shall hold the benefit
of such provisions for Seagram and shall take all actions necessary to enforce
same and the other parties hereto agree not to dispute the right of Vivendi
Holdings to so enforce.
ARTICLE 3
VIVENDI SUCCESSORS
3.1 CERTAIN REQUIREMENTS IN RESPECT OF COMBINATION, ETC.
Vivendi shall not consummate any transaction (whether by way of
reconstruction, reorganization, consolidation, merger, transfer, sale, lease or
otherwise) whereby all or substantially all of its undertaking, property and
assets or Vivendi Shares would become the property of any other Person or, in
the case of a merger, of the continuing corporation resulting therefrom unless,
but may do so if:
(a) such other Person or continuing corporation (the "VIVENDI
SUCCESSOR") by operation of law, becomes, without more, bound by the
terms and provisions of this Agreement or, if not so bound,
executes, before or contemporaneously with the consummation of such
transaction, an agreement supplemental hereto and such other
instruments (if any) as are reasonably necessary or advisable to
evidence the assumption by the Vivendi Successor of liability for
all moneys payable and property deliverable hereunder and the
covenant of such Vivendi Successor to pay and deliver or cause to be
delivered the same and its agreement to observe and perform all the
covenants and obligations of Vivendi under this Agreement;
(b) in the event that Vivendi ADSs are reclassified or otherwise changed
as part of such transaction, the same or an economically equivalent
change is simultaneously made to, or in the rights of the holders
of, the Exchangeable Shares; and
(c) such transaction shall be upon such terms and conditions as
substantially to preserve and not to impair in any material respect
any of the rights, duties, powers and authorities of the other
parties hereunder or the holders of the Exchangeable Shares.
3.2 VESTING OF POWERS IN SUCCESSOR
Whenever the conditions of section 3.1 have been duly observed and
performed, the parties, if required by section 3.1, shall execute and deliver
the supplemental agreement provided for in section 3.1(a) and thereupon the
Vivendi Successor shall possess and from time to time may exercise each and
every right and power of Vivendi under this Agreement in the name of Vivendi or
otherwise and any act or proceeding by any provision of this
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Agreement required to be done or performed by the Board of Directors of Vivendi
or any officers of Vivendi may be done and performed with like force and effect
by the directors or officers of such Vivendi Successor.
3.3 WHOLLY-OWNED SUBSIDIARIES
Nothing herein shall be construed as preventing (i) the amalgamation or
merger of any wholly-owned direct or indirect subsidiary of Vivendi (other than
Vivendi Exchangeco or Vivendi Holdings) with or into Vivendi, (ii) the
winding-up, liquidation or dissolution of any wholly-owned direct or indirect
subsidiary of Vivendi (other than Vivendi Exchangeco or Vivendi Holdings if all
of the assets of such subsidiary are transferred to Vivendi or another
wholly-owned direct or indirect subsidiary of Vivendi, or (iii) any other
distribution of the assets of any wholly-owned direct or indirect subsidiary of
Vivendi (other than Vivendi Exchangeco or Vivendi Holdings) among the
shareholders of such subsidiary for the purpose of winding up its affairs, and
any such transactions are expressly permitted by this Article 3.
ARTICLE 4
GENERAL
4.1 TERM
This Agreement shall come into force and be effective as of the date
hereof and shall terminate and be of no further force and effect at such time as
no Exchangeable Shares (or securities or rights convertible into or exchangeable
for or carrying rights to acquire Exchangeable Shares) are held by any Person
other than Vivendi and any of its affiliates.
4.2 CHANGES IN CAPITAL OF VIVENDI AND VIVENDI EXCHANGECO
At all times after the occurrence of any event contemplated under sections
2.7 and 2.8 or otherwise, as a result of which either Vivendi ADSs or the
Exchangeable Shares or both are in any way changed, this Agreement shall
forthwith be amended and modified as necessary in order that it shall apply with
full force and effect, mutatis mutandis, to all new securities into which
Vivendi ADSs or the Exchangeable Shares or both are so changed and the parties
hereto shall execute and deliver an agreement in writing evidencing such
necessary amendments and modifications.
4.3 SEVERABILITY
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule or law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any
party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto 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.
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4.4 AMENDMENTS, MODIFICATIONS
(a) Subject to sections 4.2, 4.3 and 4.5, this Agreement may not be
amended or modified except by an agreement in writing executed by
Vivendi Exchangeco, Vivendi Holdings and Vivendi and approved by the
holders of the Exchangeable Shares in accordance with section 10.2
of the Share Provisions.
(b) No amendment or modification or waiver of any of the provisions of
this Agreement otherwise permitted hereunder shall be effective
unless made in writing and signed by all of the parties hereto.
4.5 MINISTERIAL AMENDMENTS
Notwithstanding the provisions of section 4.4, the parties to this
Agreement may in writing at any time and from time to time, without the approval
of the holders of the Exchangeable Shares, amend or modify this Agreement for
the purposes of:
(a) adding to the covenants of any or all parties if the Board of
Directors of each of Vivendi Exchangeco, Vivendi Holdings and
Vivendi shall be of the good faith opinion that such additions will
not be prejudicial to the rights or interests of the holders of the
Exchangeable Shares;
(b) making such amendments or modifications not inconsistent with this
Agreement as may be necessary or desirable with respect to matters
or questions which, in the good faith opinion of the Board of
Directors of each of Vivendi Exchangeco, Vivendi Holdings and
Vivendi, it may be expedient to make, provided that each such Board
of Directors shall be of the good faith opinion that such amendments
or modifications will not be prejudicial to the rights or interests
of the holders of the Exchangeable Shares; or
(c) making such changes or corrections which, on the advice of counsel
to Vivendi Exchangeco, Vivendi Holdings and Vivendi, are required
for the purpose of curing or correcting any ambiguity or defect or
inconsistent provision or clerical omission or mistake or manifest
error, provided that the Boards of Directors of each of Vivendi
Exchangeco, Vivendi Holdings and Vivendi shall be of the good faith
opinion that such changes or corrections will not be prejudicial to
the rights or interests of the holders of the Exchangeable Shares.
4.6 MEETING TO CONSIDER AMENDMENTS
Vivendi Exchangeco, at the request of Vivendi, shall call a meeting or
meetings of the holders of the Exchangeable Shares for the purpose of
considering any proposed amendment or modification requiring approval under
section 4.4. Any such meeting or meetings shall be called and held in accordance
with the by-laws of Vivendi Exchangeco, the Share Provisions and all applicable
laws.
4.7 ENUREMENT
This Agreement shall be binding upon and enure to the benefit of the
parties hereto and their respective successors and assigns.
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4.8 NOTICES TO PARTIES
All notices and other communications between the parties to this Agreement
shall be in writing and shall be deemed to have been given if delivered
personally or by confirmed telecopy to the parties at the following addresses
(or at such other address for any such party as shall be specified in like
notice):
Vivendi S.A.,
[ ]
Paris, France
Attention:
Telecopier No. 011 331
with a copy (which shall not constitute notice) to:
Bredin Prat
130 rue du Faubourg Saint-Honore
75008 Paris
Attention:
Telecopier No.: 01-43-59-70-01/01-45-63-14-07
Cravath, Swaine & Moore
Worldwide Plaza
825 Eighth Plaza
New York, NY 10019-7475
Attention: Faiza Saeed, Esq.
Telecopier No.: (212) 474-3700
Blake, Cassels & Graydon LLP
Box 25, Commerce Court West
199 Bay Street
Toronto, Ontario
M5L 1A9
Attention: Mr. Alan Bell
Telecopier No. (416) 863-2653
Any notice or other communication given personally shall be deemed to have
been given and received upon delivery thereof and if given by telecopy shall be
deemed to have been given and received on the date of confirmed receipt thereof
unless such day is not a
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<PAGE> 14
Business Day in which case it shall be deemed to have been given and received
upon the immediately following Business Day.
4.9 COUNTERPARTS
This Agreement may be executed in counterparts, each of which shall be
deemed an original, and all of which taken together shall constitute one and the
same instrument.
4.10 JURISDICTION
This Agreement shall be construed and enforced in accordance with the laws
of the Province of Ontario and the laws of Canada applicable therein.
4.11 ATTORNMENT
Each of the parties hereto agrees that any action or proceeding arising
out of or relating to this Agreement may be instituted in the courts of Ontario,
waives any objection which it may have now or hereafter to the venue of any such
action or proceeding, irrevocably submits to the jurisdiction of the said courts
in any such action or proceeding, agrees to be bound by any judgment of the said
courts and not to seek, and hereby waives, any review of the merits of any such
judgment by the courts of any other jurisdiction and Vivendi and Vivendi
Holdings hereby appoint Vivendi Exchangeco at its registered office in the
Province of Ontario as attorney for service of process.
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<PAGE> 15
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
VIVENDI
By:___________________________
Name:
Title:
3045479 NOVA SCOTIA COMPANY
By:___________________________
Name:
Title:
3744531 CANADA INC.
By:___________________________
Name:
Title:
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