Permitted Corporate Arrangement

Permitted Corporate Arrangement. A corporate arrangement under the Canada Business Corporations Act ("CBCA") (i) for the sole purpose of a Permitted Conversion, or (ii) where each of the following conditions are met: (A) each of the Core Companies is solvent (as construed under any of the CCAA or BIA) immediately prior to the filing of the corporate arrangement, (B) none of the conditions in paragraphs 11(b)(x)(A) through 11(b)(x)(D) of this Agreement exist, (C) none of the Core Companies are relieved, stayed, prohibited or... impaired from the performance of any or all of its obligations under this Agreement, and no order is sought or obtained staying, limiting, prohibiting or impairing WEA from exercising or relying on any of its rights or remedies under this Agreement, (D) there is no exchange or issuance of securities, other than a debt for equity swap, which may include a reasonable consent or similar fee paid to the debt holders by way of issuance of securities, (E) except in the circumstances described in subsection (iii) of this Section 11(l) to the contrary, there is no Change in Control as defined in this Agreement, (F) there is no transfer of all or substantially all of the property of any of the Core Companies assets, (G) there is no liquidation or dissolution of any of the Core Companies, (H) the extension of any debt under the corporate arrangement is not less than 18 months, and (I) prior to any proceedings being brought, instituted or filed in connection with such corporate arrangement, the written consent and approval of at least 67% in dollar amount of the creditors affected by the proposed corporate arrangement shall have been obtained. (iii) On one single occurrence during the Term, Sections 11(b)(i) (insofar as it applies to an "arrangement") and 11(b)(ii) of this Agreement shall not apply if a Person or group of Persons (for purposes of this definition, a "Group") (as the term "group" is used in Rule 13d-5 of the United States Securities Exchange Act of 1934) (the "Exempt Party") becomes the beneficial owner, directly or indirectly, of thirty percent (30%) or more of the aggregate voting power or aggregate equity value represented by the issued and outstanding Ownership Interests of Cinram or any member of the Cinram Group pursuant to (1) a debt for equity swap in connection with a Permitted Corporate Arrangement, (2) an issuance in connection with a Permitted Corporate Arrangement of instruments convertible into or exchangeable for such Ownership Interests, or (3) an issuance of Ownership Interests the proceeds of which are used to repurchase Ownership Interests or instruments convertible into or exchangeable for Ownership Interests issued in connection with a Permitted Corporate Arrangement, in each case provided that all of the following conditions are met: (A) during the Term, the Exempt Party does not, and is not entitled, directly or indirectly (through a voting trust or similar agreement or otherwise), to appoint more than 30% of the board of directors (or equivalent) of Cinram or any member of the Cinram Group, or otherwise controls the business of such entities; and (B) during the Term, the Exempt Party is not directly or indirectly a competitor of WEA; and (C) during the Term, the Exempt Party does not, directly or indirectly, have an Ownership Interest in a competitor of WEA, other than an Ownership Interest in, a publicly listed competitor of WEA in the aggregate amount of less than five percent (5%) of the aggregate voting power or aggregate equity value represented by the issued and outstanding Ownership Interests of such competitor. Thereafter, Sections 11(b)(i) and 11(b)(ii) of this Agreement shall apply to any other Persons or Group without regard to this exception View More