Document:

AMENDMENT NO. 1 TO AMENDED LOAN AGREEMENT

 

Exhibit 4.5

RAND A TECHNOLOGY CORPORATION

as Borrower

and

DASSAULT SYSTÈMES S.A.

as Euro Loan Lender

and

DASSAULT SYSTÈMES S.A.

as Security Agent

and

DASSAULT SYSTEMES CORPORATION

as U.S. Dollar Lender

AMENDMENT No. 1 to

LOAN AGREEMENT NO. 1 of JUNE 18, 2002 for U.S. $6,250,000 and

€ 6,615,000

October 11, 2002

STIKEMAN ELLIOTT

 

 

AMENDMENT No. 1 TO LOAN AGREEMENT No. 1 OF JUNE 18, 2002

     THIS AMENDMENT AGREEMENT entered into and taking effect as of October 11,
2002,

	 	 	 
	BETWEEN:	 	
RAND A TECHNOLOGY CORPORATION, a corporation incorporated under
the laws of the Province of Ontario, having its registered
address at 5285 Solar Drive, Mississauga, Ontario, Canada L4W
5B8,
	 	 	 
	 	 	
(hereinafter referred to as the “Borrower”);
	 	 	 
	AND:	 	
DASSAULT SYSTÈMES S.A., a corporation incorporated under the laws
of France, having its registered address at 9, Quai Marcel
Dassault, BP 310, 92156 Suresnes, Cedex, France,

	 	 	 
	 	 	
(hereinafter referred to as the “Euro Lender”);
	 	 	 
	AND:	 	
DASSAULT SYSTÈMES S.A., a corporation incorporated under the laws
of France, having its registered address at 9, Quai Marcel
Dassault, BP 310, 92156 Suresnes, Cedex, France,
	 	 	 
	 	 	
(hereinafter referred to as the “Security Agent”);
	 	 	 
	AND:	 	
DASSAULT SYSTEMES CORPORATION, a corporation incorporated under
the laws of the State of Delaware, having its registered address
at Corporation Trust Center, 1209 Orange Street, Wilmington,
County of New Castle, Delaware 19801 USA,
	 	 	 
	 	 	
(hereinafter referred to as the “U.S. Dollar Lender”).

     WHEREAS Borrower, Euro Lender, Security Agent and U.S. Dollar Lender
(collectively, the “Parties”) entered into a Loan Agreement No. 1, dated June
18, 2002, whereby Euro Lender agreed to lend €6,615,000 to the Borrower and
U.S. Dollar Lender agreed to lend U.S.$6,250,000 to the Borrower (the “Loan No.
1”);

 

 

     WHEREAS the Parties entered into a Loan Agreement No. 2, dated June 18,
2002, whereby Euro Lender agreed to lend €6,615,000 to the Borrower and U.S.
Dollar Lender agreed to lend U.S.$6,250,000 to the Borrower (the “Loan No. 2”);

     WHEREAS the First Tranche Advance Date, as such term is defined in Loan
No. 2, is February 14, 2003;

     WHEREAS the Borrower has requested that the terms of Loan No. 2 be amended
to change the First Tranche Advance Date from February 14, 2003 to October 14,
2002 (the “Change of the First Tranche Advance Date”);

     WHEREAS the Conversion Right, under Loan No. 2 provides that it is subject
to TSX approval;

     WHEREAS, in consideration for the Change of the First Tranche Advance
Date, the Parties wish to amend Loan No. 2 to so that the Conversion Right is
no longer subject to TSX approval; and

     WHEREAS the amendment to the Conversion Right under Loan No. 2 requires a
corresponding amendment to Loan No. 1, pursuant to the terms hereof (the
“Amending Agreement”), so that the Conversion Right, as defined therein, shall
be subject to obtaining approval of the TSX for such Conversion Right.

     NOW, THEREFORE, in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the Parties agree as follows:

ARTICLE 1

AMENDMENT TO LOAN NO. 1

	1.1	 	Defined Terms

     Unless otherwise defined in this Amendment Agreement, all capitalized
terms used in this Amendment Agreement shall have the meaning ascribed thereto
in Loan No. 1.

	1.2	 	Rand Conversion Right Subject to TSX Approval
	 
	 	 	The first sentence of Section 3.1 of Loan No. 1 is hereby deleted and
replaced by the following:
	 
	 	 	“Subject to (i) the Borrower obtaining approval of the TSX to the
Conversion Right, to the entire satisfaction of the Lenders and their
legal counsel, acting reasonably, and to (ii) Section 3.2, the Borrower
shall have the right (the “Conversion Right”), at the Borrower’s sole
option, at any time and from time to time prior to the repayment in full
of the Maturity Amounts, to convert all or any

 

 

	 	 	part of the then outstanding principal amount of either or both Loans,
together with accrued and unpaid interest thereon, (which, if less than
the entire unpaid principal amount and accrued and unpaid interest under
such Loan, is U.S. $100,000 (in the case of the U.S. Dollar Loan) or
€100,000 (in the case of the Euro Loan), or an amount in excess thereof
which is an integral multiple of U.S. $100 or €100, as the case may be,
into that number of fully paid and non-assessable Common Shares equal to
the amount of the outstanding principal amount (plus accrued and unpaid
interest thereon) in respect of which the Conversion Right is exercised
(in U.S. Dollars for a conversion under the U.S. Dollar Loan and the
Equivalent Amount thereof in U.S. Dollars for a conversion under the Euro
Loan), divided by the Conversion Price in effect on the applicable
Conversion Date.”

ARTICLE 2

GENERAL

	2.1	 	No Other Amendment

     Other than as specifically provided herein, the terms of Loan No. 1 shall
remain in full force and effect.

	2.2	 	Governing Law

     This Amending Agreement shall be governed by and interpreted and enforced
in accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein.

	2.3	 	Counterparts and Facsimile

     This Amending Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same instrument. Delivery of
an executed signature page to this Agreement by any party by facsimile
transmission shall be as effective as delivery of a manually executed copy of
this Amending Agreement by such party.

[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

 

 

     IN WITNESS WHEREOF the parties have executed this Amending Agreement as of
the date appearing on the first page hereof.

	 	 	 
	 	 	
RAND A TECHNOLOGY CORPORATION
	 	 	 
	 	 	
By: Rui Malhinha, Chief Financial Officer
	 	 	 
	 	 	 
	 	 	

	 	 	 
	 	 	 
	 	 	
DASSAULT SYSTÈMES S.A., in its capacity 

as a Lender
	 	 	 
	 	 	
By: Thibault de Tersant
	 	 	 
	 	 	 
	 	 	

	 	 	 
	 	 	 
	 	 	
DASSAULT SYSTÈMES S.A., in its capacity 

as the Security Agent
	 	 	 
	 	 	
By: Thibault de Tersant
	 	 	 
	 	 	 
	 	 	

	 	 	
DASSAULT SYSTÈMES CORPORATION
	 	 	 
	 	 	
By: Thibault de TersantLOAN AGREEMENT NO. 2

 

Exhibit 4.6

Any text removed pursuant to Dassault Systèmes’ confidential treatment request has been separately filed

with the U.S. Securities and Exchange Commission and is marked “[***]” herein.

RAND A TECHNOLOGY CORPORATION

as Borrower

and

DASSAULT SYSTÈMES S.A.

as Euro Loan Lender

and

DASSAULT SYSTÈMES S.A.

as Security Agent

and

DASSAULT SYSTEMES CORPORATION

as U.S. Dollar Lender

 

LOAN AGREEMENT NO. 2

U.S. $6,250,000

and

€ 6,615,000

June 18, 2002

 

STIKEMAN ELLIOTT

 

 

Any text removed pursuant to Dassault Systèmes’ confidential treatment request has been separately filed

with the U.S. Securities and Exchange Commission and is marked “[***]” herein.

LOAN AGREEMENT NO. 2

     THIS LOAN AGREEMENT entered into as of June 18, 2002,

	 	 	 
	BETWEEN:	 	
RAND A TECHNOLOGY CORPORATION, a corporation incorporated under
the laws of the Province of Ontario, having its registered
address at 5285 Solar Drive, Mississauga, Ontario, Canada L4W
5B8,
	 	 	 
	 	 	
(hereinafter referred to as the “Borrower”);
	 	 	 
	AND:	 	
DASSAULT SYSTÈMES S.A., a corporation incorporated under the laws
of France, having its registered address at 9, Quai Marcel
Dassault, BP 310, 92156 Suresnes, Cedex, France,
	 	 	 
	 	 	
(hereinafter referred to as the “Euro Lender”);
	 	 	 
	AND:	 	
DASSAULT SYSTÈMES S.A., a corporation incorporated under the laws
of France, having its registered address at 9, Quai Marcel
Dassault, BP 310, 92156 Suresnes, Cedex, France,
	 	 	 
	 	 	
(hereinafter referred to as the “Security Agent”);
	 	 	 
	AND:	 	
DASSAULT SYSTEMES CORPORATION, a corporation incorporated under
the laws of the State of Delaware, having its registered address
at Corporation Trust Center, 1209 Orange Street, Wilmington,
County of New Castle, Delaware 19801 USA ,
	 	 	 
	 	 	
(hereinafter referred to as the “U.S. Dollar Lender”).

ARTICLE 1

INTERPRETATION

	1.1	 	Defined Terms

	 	 	As used in this Agreement, the following terms have the following meanings:
	 	 	 
	 	 	“Agreement” means this loan agreement and all schedules and instruments
in amendment or confirmation of it; and the expressions “Article” and
“Section” followed by a number mean and refer to the specified Article or
Section of this Agreement.

 

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	 	 	“Borrower” means, at any time, RAND A TECHNOLOGY CORPORATION and its
successors and permitted assigns.
	 
	 	 	“Borrower’s General Security Agreement” means, a general security
agreement from the Borrower in favour of the Security Agent granting the
Security Agent on behalf of the Lenders a security interest in all of the
property and assets of the Borrower.
	 
	 	 	“Borrower’s Specific Security Agreements” means, collectively, those
security agreements from the Borrower or its Subsidiaries, in favour of
the Security Agent granting the Security Agent on behalf of the Lenders a
security interest in the Specific Collateral including those identified
in Schedule 7.1(o).
	 
	 	 	“Business Day” means any day of the year, other than a Saturday, Sunday
or other day on which banks are required or authorized to close in any
one of Paris, France, New York, New York or Toronto, Ontario, Canada.
	 
	 	 	“Business Plan” means that business plan of the Borrower relative to the
DS Products and Services Business delivered to the Representative Lender
on or about the date of this Agreement.
	 
	 	 	“Cdn. Dollar” and “Cdn. $” means lawful money of Canada.
	 
	 	 	“Change of Control” means any event or series of events (i) which result
in any Person, or any group of Persons acting jointly or in concert,
becoming the beneficial owner or owners, directly or indirectly, of
securities of the Borrower to which are attached more than 50% of the
votes that may be cast to elect directors of the Borrower provided that
the votes attached to such securities are sufficient, if exercised, to
elect a majority of the directors of the Borrower or (ii) the Borrower is
merged, consolidated or reorganized into or with another Person and, as a
result, less than the majority of the combined voting power of the then
outstanding securities of such Person immediately after such Transaction
are held in the aggregate by the holders of the voting shares of the
Borrower immediately prior to such transaction; or (iii) any transaction
that would have, or the first of a series of transactions to the extent
that such first transaction when completed would have, the same or
similar effect as any transaction or a series of transactions referred to
in paragraphs (i) and (ii) above.
	 
	 	 	“Closing Date” means June 19, 2002.
	 
	 	 	“Collateral” means any and all property and assets of the Borrower in
respect of which the Security Agent has or will have a Lien pursuant to
the Borrower’s General Security Agreement.
	 
	 	 	“Common Shares” means the common shares in the share capital of the
Borrower.
	 
	 	 	“Conversion Right” has the meaning specified in Section 3.1.

 

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	 	 	“Core Business” means the systems integration business of providing
engineering services and technology to manufacturers looking to optimize
their product lifecycle management (PLM) processes or improve their
competitiveness or profitability by enhancing key aspects of their
product creation, development, manufacturing, marketing or distribution,
and any business ancillary or related thereto and includes the DS
Products and Services Business.
	 
	 	 	“DS Products and Services Business” means the business of the Borrower
and most of its Subsidiaries which is the business of distributing
products of the Euro Lender and its Subsidiaries and providing services
ancillary or related to such products, and any business ancillary or
related to such business.
	 
	 	 	“Default” means an event, which with the giving of notice or passage of
time, or both, would constitute an Event of Default.
	 
	 	 	“Environmental Laws” means all applicable laws, regulations, orders,
judgments, decisions of and agreements with a Governmental Entity, and
all other statutory requirements, relating to public health or the
protection of the environment and all authorizations, permits, consents,
registrations and approvals issued pursuant to such laws, agreements or
statutory requirements.
	 
	 	 	“Environmental Liabilities” means all liabilities imposed by, under or
pursuant to Environmental Laws or which relate to the existence of
contaminants on, under or about the real property owned or leased by the
Borrower and its Subsidiaries.
	 
	 	 	“Equivalent Amount” means, on a particular date in respect of any amount
(the “original amount”) expressed in a particular currency (the “original
currency”), the equivalent amount expressed in a second designated
currency (the “second currency”) determined by reference to the Bank of
Canada noon rate at which the original currency may be exchanged into the
second currency as published on the Reuters Screen page BOFC. In the
event that such rate does not appear on such Reuters page, such rate
shall be ascertained by reference to any other means (as selected by the
Borrower) by which such rate is quoted or published from time to time by
the Bank of Canada; provided that, if at the time of any such
determination, for any reason, no such exchange rate is being quoted or
published, the Borrower may use such reasonable method as it considers
appropriate to ascertain such rate, and the resulting determination shall
be conclusive absent manifest error.
	 
	 	 	“Event of Default” has the meaning specified in Article 8.
	 
	 	 	“Euro” or “€” means the lawful currency of the member states of the
European Union that adopt the single currency in accordance with the
Treaty establishing the European Community, as amended by the Treaty on
European Union.
	 
	 	 	“Euro Lender” means DASSAULT SYSTÈMES S.A. and its successors and
permitted assigns.

 

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	 	 	“Euro Loan” means the term loan, in two Tranches, to be made available to
the Borrower by the Euro Lender in the aggregate principal amount of
€6,615,000 as provided for in subsection 2.1(a).
	 
	 	 	“Financial Quarter” means one of the financial quarters of the Borrower
being the periods of (a) January, February and March, (b) April, May and
June, (c) July, August and September, and (d) October, November and
December of each calendar year.
	 
	 	 	“Financial Year” means a financial year of the Borrower being the period
from and including January 1 in a calendar year to and including December
31 in the same calendar year.
	 
	 	 	“First Tranche Advance Date” means February 14, 2003 (or if the
conditions to the advance of the first Tranche under Section 5.2 have not
been met on such date, subject to the right of the Lenders to terminate
their commitments to make future advances as provided for in Section 8.1,
the first Business Day within forty-five (45) calendar days thereof on
which the conditions to the advance of the first Tranche under Section
5.2 have been met).
	 
	 	 	“Fixed Rate” has the meaning ascribed thereto in Article 4.
	 
	 	 	“Funded Debt” of any Person means (i) all indebtedness of such Person for
borrowed money, including borrowings by way of bankers’ acceptances and
(except for any such reimbursement obligations in respect of amounts
drawn under a letter of credit or letter guarantee to finance the payment
of indebtedness incurred in the ordinary course of business that would
ordinarily constitute a trade payable) reimbursement obligations for
amounts drawn under a letter of credit or letter of guarantee, (ii) all
indebtedness of such Person for the deferred purchase price of property
or services, other than any such indebtedness incurred in the ordinary
course of business that would ordinarily constitute a trade payable, and
which is represented by a note, bond, debenture or other evidence of
Funded Debt, (iii) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of
the seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), (iv) all current
liabilities of such Person represented by a note, bond, debenture or
other evidence of Funded Debt to the extent that such indebtedness would
be considered borrowed money in accordance with GAAP, and (v) all
Capitalized Lease Obligations (as defined in the definition of ‘Permitted
Liens’) of such Person.
	 
	 	 	“GAAP” means, at any time, accounting principles generally accepted in
Canada as recommended in the Handbook of the Canadian Institute of
Chartered Accountants at the relevant time applied on a consistent basis
(except for changes made with the prior written consent of the
Representative Lender and approved by the Borrower’s independent auditors
in accordance with promulgations of the Canadian Institute of Chartered
Accountants).

 

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	 	 	“Governmental Entity” means any (i) multinational, federal, provincial,
state, municipal, local or other government, governmental or public
department, central bank, court, commission, board, bureau, agency or
instrumentality, domestic or foreign, (ii) any subdivision or authority
of any of the foregoing, or (iii) any quasi-governmental or private body
exercising any regulatory, expropriation or taxing authority under or for
the account of any of the above.
	 
	 	 	“Hypothec” has the meaning ascribed thereto in Schedule 7.1(p).
	 
	 	 	“IBM” means International Business Machines Corporation, a corporation
organized under the laws of the State of New York, having its registered
office at New Orchard Armonk, New York, U.S.A. 10504.
	 
	 	 	“IBM Agreements” has the meaning ascribed thereto in Section 5.1(f).
	 
	 	 	“Indemnified Person” has the meaning specified in Section 9.6(a).
	 
	 	 	“Instalment” has the meaning specified in Section 2.3.
	 
	 	 	“Intellectual Property” means:

	 	(i)	 	all issued patents, patentable inventions,
pending applications for patents, and patents which may be
issued from current applications, (including divisions,
reissues, renewals, re-examinations, continuations,
continuations in part and extensions) applied for or
registered in any jurisdiction;
	 
	 	(ii)	 	all trade-marks, trade-names, brands, trade
dress, business names, domain name, tag lines, designs,
graphics, logos and other commercial symbols and indicia of
origin whether registered or not, and any goodwill associated
therewith;
	 
	 	(iii)	 	all copyrights, copyright registrations and
applications therefore, and all other rights corresponding
thereto throughout the world;
	 
	 	(iv)	 	all industrial designs and design patents or
similar rights applied for or registered in any jurisdiction;
	 
	 	(v)	 	all integrated circuit topographies or similar
rights, applied for or registered in any jurisdiction; and
	 
	 	(vi)	 	all trade secrets and know-how.

	 	 	“Lenders” means collectively, the Euro Lender and the U.S. Dollar Lender
and “Lender” means either one of the Lenders.

 

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	 	 	“Lien” means any mortgage, charge, pledge, hypothecation, security
interest, assignment, encumbrance, lien (statutory or otherwise), title
retention agreement or arrangement or other encumbrance of any nature or
any other arrangement or condition that in substance secures payment or
performance of an obligation.
	 
	 	 	“Loans” means the Euro Loan and the U.S. Dollar Loan and “Loan” means
either one of the Loans.
	 
	 	 	“Loan Documents” means this Agreement, the Borrower’s General Security
Agreement, the Borrower’s Specific Security Agreements, the Hypothec and
all other loan or security related documents, and all certificates,
executed and delivered to the Lenders by the Borrower pursuant to or in
connection therewith or with this Agreement.
	 
	 	 	“Material Adverse Effect” means (i) a material adverse effect on the
business, operations, results of operations, prospects, assets,
liabilities or financial condition of the Borrower and its Subsidiaries
taken as a whole or (ii) a material adverse effect on the ability of the
Borrower to fulfill any of its payment obligations of principal or
interest hereunder or under the Other Lender Credit Agreement.
	 
	 	 	“Material Agreements” means the agreements listed in Schedule 6.1(v)(v)
and any agreement, contract or similar instrument to which the Borrower
or any of its Subsidiaries is a party or to which any of their property
or assets may be subject for which breach, non-performance, cancellation
or failure to renew could reasonably be expected to have a Material
Adverse Effect, provided however that, notwithstanding the foregoing, the
IBM Agreements shall be deemed for all purposes of the Loan Documents to
be Material Agreements.
	 
	 	 	“Maturity Amounts” means all outstanding principal of the Loan Loans and
all accrued interest thereon.
	 
	 	 	“Merger Transaction” has the meaning specified in subsection 7.2(c).
	 
	 	 	“Other Lender Credit Agreement” means the credit agreement dated as of
the date of this Agreement between the Euro Lender, as lender of Euros,
the U.S. Dollar Lender, as lender of U.S. Dollars, and the Borrower, as
borrower, as the same may from time to time be supplemented, amended,
consolidated or restated.
	 
	 	 	“Permitted Liens” means, in respect of any Person, any one or more of the
following:

	 	(a)	 	Liens for taxes, assessments or government charges or levies
not at the time due and delinquent or the validity of which is being
contested at the time by such Person in good faith by proper legal
proceedings, and which contested Liens have not had and would not
reasonably be expected to have a Material Adverse Effect and, for
which adequate provision has been made in accordance with GAAP;
	 
	 	(b)	 	the Lien of any judgment rendered or claim filed against such
Person which such Person is contesting in good faith by proper legal
proceedings, and which Lien

 

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	 	 	 	has not had and would not reasonably be expected to have a Material
Adverse Effect;
	 
	 	(c)	 	inchoate or statutory Liens of contractors, subcontractors,
mechanics, workers, suppliers, materialmen, carriers and others in
respect of construction, maintenance, repair or operation of assets
of the Person, provided that such Liens are related to obligations
not due or delinquent, are not registered against title to any
assets of the Person and in respect of which adequate holdbacks are
being maintained as required by applicable law or such Liens are
being contested in good faith by appropriate proceedings and in
respect of which there has been set aside a reserve (segregated to
the extent required by GAAP) in an adequate amount and provided
further that such Liens do not reduce the value of the asset so
affected or materially interfere with the use of such asset in the
operation of the business of the Person;
	 
	 	(d)	 	restrictions, easements, rights-of-way, servitudes or other
similar rights in land, real or immovable property (including rights
of way and servitudes for railways, sewers, drains, gas and oil
pipelines, gas and water mains, electric light and power and
telephone or telegraph or cable television conduits, poles, wires
and cables) granted to or reserved by other persons; provided that,
such restrictions, easements, rights-of-way, servitudes or other
similar rights in the aggregate will not have or would not
reasonably be expected to have a Material Adverse Effect;
	 
	 	(e)	 	the right reserved to or vested in any Governmental Entity,
by the terms of any statutory provision or by the terms of any
lease, license, franchise, grant or permit of the Person (whether or
not having the force of law) acquired by such Person (each, a
“Permit”), to terminate any such Permit or to require annual or
other payments as a condition to the continuance thereof;
	 
	 	(f)	 	the encumbrance resulting from the deposit of cash or
securities in connection with any of the Liens referred to in
paragraph (a), (b) or (c) of this definition pending a final
determination as to the existence or amount of any obligation
referred to therein;
	 
	 	(g)	 	security given to a public utility or any other Governmental
Entity when required by such utility or other Governmental Entity in
connection with the operations of such Person in the ordinary course
of its business;
	 
	 	(h)	 	the reservations, limitations, provisos and conditions, if
any, expressed in any grants from the Crown or any similar
authority;
	 
	 	(i)	 	title defects or irregularities which are of a minor nature;
provided that such title, defects or irregularities in the aggregate
will not materially impair the use of the property for the purposes
for which it is held by such Person;
	 
	 	(j)	 	Liens securing Capitalized Lease Obligations of such Person
and Purchase Money Obligations of such Person not in excess of U.S.
$5,000,000 (or the Equivalent

 

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	 	 	 	Amount in any other currencies) in the aggregate at any time for
the Borrower and its Subsidiaries taken as a whole; provided that
(x) any such Lien securing a Capitalized Lease Obligation is
limited to the property or asset including associated rights) which
is the subject matter of such Capitalized Lease Obligation, and (y)
in the case any such Lien securing a Purchase Money Obligation,
such Lien is limited to the property or asset (including associated
rights) acquired, constructed, installed or improved using the
funds advanced to the Company or a Subsidiary in connection with
such Purchase Money Obligation;
	 
	 	 	 	For the purposes of this definition of Permitted Liens:

	 	 	 	“Capital Lease” means a lease of (or other agreement
conveying the right to use) real and/or personal property,
which lease is required to be classified and accounted for as
a capital lease on a balance sheet of the lessee under GAAP
(including the Canadian Institute of Chartered Accountants
Handbook Section 3065); and
	 
	 	 	 	“Capitalized Lease Obligations” means, as to any Person, the
obligations of such Person to pay rent or other amounts under
a Capital Lease and, for purposes of this Agreement, the
amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP (including the
Canadian Institute of Chartered Accountants Handbook Section
3065), or the deemed principal amount under GAAP;

	 	(k)	 	the Liens contemplated in favour of the Security Agent under
this Agreement [and in favour of the security agent under the Other
Lender Credit Agreement];
	 
	 	(l)	 	Liens securing indebtedness or other obligations of a
Subsidiary owing to the Borrower or another Subsidiary;
	 
	 	(m)	 	Liens on property or shares of a Person at the time that such
Person becomes a Subsidiary of the Borrower; provided, however, that
the Lien may not extend to any other property or assets owned by the
Borrower or any other Subsidiary thereof; provided, further, that
such Liens are not created, incurred or assumed in connection with,
or in contemplation of, or to provide credit support in connection
with, such Person becoming a Subsidiary of the Borrower;
	 
	 	(n)	 	Liens on property or assets at the time the Borrower or a
Subsidiary thereof acquires such property or assets, including any
acquisition by means of an amalgamation, merger or consolidation;
provided, however, that the Lien may not extend to any other
property or assets owned by the Borrower or any Subsidiary thereof;
provided, further, that such Liens are not created, incurred or
assumed in connection with, or in contemplation of, or to provide
credit support in connection with, such acquisition;

 

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	 	(o)	 	Liens disclosed in Schedule 7.2(c) but only to the extent
such Liens conform to their description in such Schedule;
	 
	 	(p)	 	other Liens not otherwise covered by this definition, where
the aggregate amount of the indebtedness secured by such Liens does
not exceed U.S. $500,000, in the aggregate (or the Equivalent Amount
in any other currencies);
	 
	 	(q)	 	contractual rights of set-off provided to creditors under
cash concentration, mirror-netting or similar arrangements where all
accounts or amounts subject to such arrangements are held in the
name of any one or more of the Borrower and its Subsidiaries;
	 
	 	(r)	 	the Lien comprised in the deposit of cash collateral or
marketable securities with a counterparty under a hedging
arrangement entered into by such Person in the ordinary course of
business for the purpose of carrying on the same and not for
speculative purposes which Lien shall not exceed $1,000,000;
	 
	 	(s)	 	Liens from the Borrower and any of its Subsidiaries to secure
any Permitted Senior Credit Facility; and
	 
	 	(t)	 	Liens to secure any refinancing (a “Refinancing”), extension,
renewal or replacement as a whole, or in part, of any indebtedness
or obligation (an “Original Obligation”) secured by any Lien
referred to in the foregoing clauses of this definition which Liens
are not otherwise prohibited by the terms hereof, provided that (i)
such Refinancing will be for the same or lesser amount as the
Original Obligation that it replaces and (ii) the Lien securing such
Refinancing will be on the same assets, or a lesser portion thereof,
over which a Lien has been granted to prior to the date hereof
securing such Original Obligation..

	 	 	“Permitted Mergers” means a Merger Transaction involving the Borrower or
any of its Subsidiaries where the following conditions are satisfied:

	 	(i)	 	in the case of any such Merger Transaction
involving the Borrower or any of its Canadian Subsidiaries,
the resulting, surviving or transferee Person shall be a
Person that is not a non-resident of Canada for purposes of
the Income Tax Act (Canada) and is organized and existing
under the laws of Canada or any province of Canada as a
corporation, and
	 
	 	(ii)	 	in the case of any such Merger Transaction
involving the Borrower, the resulting, surviving or transferee
Person shall (A) expressly assume on terms and conditions as
to legal effect satisfactory to the Representative Lender and
the Representative Lender’s counsel the obligations of the
Borrower under all Loan Documents and (B) in the reasonably
held opinion of the Representative Lender, is no less
financially solvent immediately after such Merger Transaction
than the Borrower was immediately prior to such Merger
Transaction; and

 

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	 	(iii)	 	no Default or Event of Default has occurred and
is continuing and immediately after giving effect to such
Merger Transaction no Default or Event of Default shall have
occurred and be continuing;
	 
	 	(iv)	 	no such Merger Transaction shall affect the
validity or enforceability of any Loan Document;
	 
	 	(v)	 	the Borrower shall have delivered to the
Representative Lender a certificate of a senior officer of the
Borrower and an opinion of counsel to the Borrower, each
stating that such Merger Transaction complies herewith and
each being otherwise in form and substance reasonably
acceptable to the Representative Lender; provided that no such
certificate or opinion shall be required in the case of a
Merger Transaction involving only two or more Subsidiaries of
the Borrower;
	 
	 	(vi)	 	the transaction does not effect (A) a Change of
Control of the Borrower or (B) a Change of Control of a
Subsidiary thereof such that the Borrower no longer owns,
directly or indirectly, a majority of the voting shares of
such Subsidiary, or (C) a disposition of all or substantially
all the assets of the Borrower or a Subsidiary thereof to an
acquiror that is neither the Borrower nor a Subsidiary
thereof; and
	 
	 	(vii)	 	the transaction does not materially adversely
effect either the Core Business or the DS Products and
Services Business.

	 	 	“Permitted Senior Credit Facility” means any one or more loan or credit
facilities entered into following the Closing Date from time to time
existing between any one or more of the Borrower and its Subsidiaries, as
borrowers, and any other Person or Persons whose business includes the
lending of money, provided that the aggregate principal amount of the
indebtedness owing under all such loan and credit facilities may not
exceed (a) at any time prior to the Specific Security Delivery Date, Cdn.
$10,000,000 (or the Equivalent Amount in any other currencies), and (b)
at any time on or after the Specific Security Delivery Date, U.S.
$22,000,000 (or the Equivalent Amount in any other currencies).
	 
	 	 	“Person” means a natural person, partnership, corporation, joint stock
company, trust, unincorporated association, joint venture or other entity
or Governmental Entity and pronouns have a similarly extended meaning.
	 
	 	 	“Purchase Money Obligation” means indebtedness of the Borrower or a
Subsidiary thereof incurred or assumed to finance the purchase price, in
whole or in part, of any property or asset or incurred to finance the
cost, in whole or in part, of construction or installation of, or
improvements to, any property or asset of the Borrower or a Subsidiary
thereof, provided that the indebtedness is incurred or assumed within 24
months after, as the case may, the purchase of, or the completion of the
construction or installation of, or the completion of improvements to,
such property or asset, and includes any extension,

 

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	 	 	renewal or refinancing of any of that indebtedness so long as the
principal amount of such indebtedness on the date of such extension,
renewal or refinancing is not increased.
	 
	 	 	“Repayment Date” means July 18, 2012.
	 
	 	 	“Representative Lender” means DASSAULT SYSTÈMES S.A. in its capacity as
the representative Lender for both Lenders under the Loan Documents.
	 
	 	 	“Second Tranche Advance Date” means August 14, 2003 (or if the conditions
to the advance of the second Tranche under Section 5.2 have not been met
on such date, subject to the right of the Lenders to terminate their
commitments to make future advances as provided for in Section 8.1, the
first Business Day within forty-five (45) calendar days thereafter on
which the conditions to the advance of the second Tranche under Section
5.2 have been met)..
	 
	 	 	“Security” means, at any time, the Lien in favour of the Security Agent,
in the assets and properties of the Borrower or any of its Subsidiaries
securing its obligations under this Agreement and the other Loan
Documents.
	 
	 	 	“Security Agent” means the DASSAULT SYSTÈMES S.A. in its capacity as
security agent for the Lenders under the Security.
	 
	 	 	“Specific Collateral” means that property and assets of the Borrower
identified as Specific Collateral in Part II of Schedule 7.1(o).
	 
	 	 	“Specific Security Delivery Date” has the meaning specified in Section
7.1(o).
	 
	 	 	“Subsidiary” has the meaning specified in the Business Corporations Act
(Ontario) on the date of this Agreement.
	 
	 	 	“TSX” means The Toronto Stock Exchange.
	 
	 	 	“U.S. Dollar Lender” means DASSAULT SYSTEMES CORPORATION and its
successors and permitted assigns.
	 
	 	 	“U.S. Dollar Loan” means the term loan, in two Tranches, to be made
available to the Borrower by the U.S. Dollar Lender in the aggregate
principal amount of U.S. $6,250,000 as provided for in subsection 2.1(b).
	 
	 	 	“U.S. Dollars”, “United States Dollars” and “U.S. $” each mean lawful
money of the United States of America.
	 
	 	 	“Tranche” means, with respect to a Loan, one of the Tranches of such Loan
as provided for in Section 2.1.

 

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	1.2	 	Gender and Number

     Any reference in the Loan Documents to gender includes all genders and
words importing the singular number only include the plural and vice versa.

	1.3	 	Headings, etc.

     The provision of a Table of Contents, the division of this Agreement into
Articles and Sections and the insertion of headings are for convenient
reference only and are not to affect the interpretation of this Agreement.

	1.4	 	Currency

     All references in the Loan Documents to dollars, unless otherwise
specifically indicated, are expressed in United States currency.

	1.5	 	Non-Business Days

     Unless otherwise expressly provided in this Agreement, whenever any
payment is stated to be due on a day other than a Business Day, the payment
will be made on the immediately following Business Day. Unless otherwise
expressly provided in this Agreement, whenever any action to be taken is stated
or scheduled to be required to be taken on, or (except with respect to the
calculation of interest or fees) any period of time is stated or scheduled to
commence or terminate on, a day other than a Business Day, the action will be
taken or the period of time will commence or terminate, as the case may be, on
the immediately following Business Day

	1.6	 	Certain Phrases, etc.

     In any Loan Document (i) (y) the words “including” and “includes” mean
“including (or includes) without limitation” and (z) the phrase “the aggregate
of”, “the total of”, “the sum of”, or a phrase of similar meaning means “the
aggregate (or total or sum), without duplication, of”, and (ii) in the
computation of periods of time from a specified date to a later specified date,
unless otherwise expressly stated, the word “from” means “from and including”
and the words “to” and “until” each mean “to but excluding”.

	1.7	 	Accounting Terms

     All accounting terms not specifically defined in this Agreement shall be
interpreted in accordance with GAAP.

	1.8	 	Incorporation of Schedules

     The schedules attached to this Agreement shall, for all purposes of this
Agreement, form an integral part hereof.

 

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	1.9	 	Conflict

     The provisions of this Agreement prevail in the event of any conflict or
inconsistency between its provisions and the provisions of any of the other
Loan Documents.

	1.10	 	Certificates

     Any certificate required by the terms of this Agreement or any other Loan
Document to be given by an officer of the Borrower for and on behalf of the
Borrower or any of its Subsidiaries shall be given without any personal
liability on the part of the officer giving the certificate.

ARTICLE 2

CREDIT FACILITY

	2.1	 	Availability
	 
	 	 	Subject to and on the terms of this Agreement and, in particular, without
limitation, to the conditions set out in Section 5.2:

	 	(a)	 	the Euro Lender agrees to advance a loan (the “Euro Loan”) to
the Borrower in two instalments (each a “Tranche” of such Loan) as
follows:

	 	(i)	 	the Euro Lender will advance to the Borrower on
the First Tranche Advance Date the first Tranche of the Euro
Loan in an aggregate principal amount of € 3,307,500; and
	 
	 	(ii)	 	the Euro Lender will advance to the Borrower on
the Second Tranche Advance Date the second Tranche of the
Euro Loan in an aggregate principal amount of € 3,307,500; and

	 	(b)	 	the U.S. Dollar Lender to advance a loan (the “U.S. Dollar
Loan”) to the Borrower in two instalments (each a “Tranche” of such
Loan) as follows:

	 	(i)	 	the U.S. Dollar Lender will advance to the
Borrower on the First Tranche Advance Date the first Tranche
of the U.S. Dollar Loan in an aggregate principal amount of
U.S. $3,125,000; and
	 
	 	(ii)	 	the U.S. Dollar Lender will advance to the
Borrower on the Second Tranche Advance Date the second
Tranche of the U.S. Dollar Loan in an aggregate principal
amount of \U.S. $3,125,000.

	 	(c)	 	The Loans do not revolve and any amount repaid or prepaid on
either Loan, as the case may be, cannot be reborrowed and reduces
the Loan for which the repayment is made by the amount repaid or
prepaid under such Loan, as the case may be.

 

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	 	(d)	 	Each Lender shall transfer to the Borrower for value by 4:00
p.m. (Paris, France time), in the case of the Euro Lender, and 12:00
noon (Toronto, Ontario time), in the case of the U.S. Dollar Lender,
on the applicable date on which such advance is be made by such
Lender to the Borrower pursuant to the provisions of this Agreement
immediately available Euros, in the case of the Euro Lender, and
immediately available U.S. Dollars, in the case of the U.S. Dollar
Lender, in an aggregate amount equal to the principal amount of the
Tranche of the applicable Loan to be made by such Lender to the
Borrower on such date by wire transfer to the Borrower in accordance
with the applicable wire transfer instructions provided by the
Borrower to the Representative Lender prior to such date.

	2.2	 	Use of Proceeds

     The Borrower shall use the proceeds of the Loans only for the following
purposes, namely: (i) to enable the Borrower and its Subsidiaries to perform
their respective obligations under the IBM Agreements pursuant to which the
Borrower and certain of its Subsidiaries shall be authorized to distribute and
license certain products of the Euro Lender and its Subsidiaries; (ii) to
enable the Borrower and its Subsidiaries to focus the business of the Borrower
and its Subsidiaries on the distribution of products of the Euro Lender and its
Subsidiaries, as identified on the Business Plan, particularly in the United
States; and (iii) to fund working capital requirements of the Borrower and its
Subsidiaries for the purpose of implementing the Business Plan.

	2.3	 	Mandatory Repayments

     The Borrower shall repay (subject to Section 3.1 and Section Article 8)
each Tranche of each Loan in thirty-four (34) equal quarterly instalments (each
an “Instalment”). Each Instalment shall be paid on the first Business Day of
each Quarter, commencing on the first Business Day of January 2004, until the
Loans are repaid in full. The amount of each Instalment under each Tranche of
the U.S. Dollar Loan shall be U.S.$91,911.77 and the amount of each Instalment
under each Tranche of the Euro Loan shall be €97,279.42.

	2.4	 	Change of Control

     A Change of Control shall constitute an event of failure under this
Agreement and promptly, and in any event within 5 Business Days, following the
occurrence of a Change of Control the Borrower will offer in writing to the
Representative Lender to repay all principal, interest and other amounts then
owing to each Lender under the Loan Documents and will allow the Representative
Lender a period of ninety (90) days to accept such offer with respect to either
or both Lenders. If such offer is accepted in writing with respect to either
or both Lenders by the Representative Lender during such ninety (90) days, the
Borrower will, within five (5) Business Days following the acceptance by the
Representative Lender, pay to the Lenders or the applicable Lender, as the case
may be, all principal, interest and other amounts then owing to such Lenders or
Lender under the applicable Loan Documents.

 

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	2.5	 	Payments under this Agreement

	 	(a)	 	Unless otherwise expressly provided in this Agreement, the
Borrower shall, not later than 10:00 a.m. (Toronto time) on the date
a payment is due, make any payment required to be made by it to a
Lender by depositing or forwarding by wire transfer the amount of
the payment to an account, and in accordance with wire transfer
instructions, specified by such Lender.
	 
	 	(b)	 	All amounts (other than interest) owed by the Borrower to
either Lender under a Loan Document, which are not paid when due
(whether at stated maturity, on demand, by acceleration or
otherwise), to the fullest extent permitted by applicable law, shall
bear interest (both before and after default and judgment), from the
date on which such amount is due until such amount is paid in full,
payable on demand, at a rate per annum equal at all times to Prime
Rate plus 2%.
	 
	 	(c)	 	For the purposes of this Agreement, “Prime Rate” means, in
respect of interest on: (i) the U.S. Dollar Loan at any time, the
per annum reference rate of interest (however designated) of Royal
Bank of Canada for determining interest chargeable by Royal Bank of
Canada on U.S. Dollar commercial loans made in Canada, adjusted
automatically with each quoted or published change in such reference
rate, all without the necessity of any notice to the Borrower or any
other Person, and (ii) the Euro Loan on any date, the rate for a
deposit of Euros for 30 days (or for a period as closely as possible
equal to 30 days) which appears on such date (or if such date is not
a Business Day on immediately preceding Business Day) on display
page 248 on Bridge’s Telerate Service (or such display page as may
replace such page on such service, or such other service as may be
nominated as the information vendor, for the purpose of displaying
similar rates on deposits of Euros) as of 11:00 a.m. Paris France
time on such date, adjusted automatically on each date without the
necessity of any notice to the Borrower or any other Person.

	2.6	 	Prepayments

     The Borrower shall have the right to prepay from time to time on any
Business Day any principal amount outstanding under any Tranche, without
premium or penalty.

	2.7	 	Application of Prepayments

	 	(a)	 	All prepayments received by a Lender under a Loan pursuant to
Section 2.7 shall be applied by such Lender to the amounts due under
such Loan pursuant to Section 2.3 in the inverse order of their
maturity.
	 
	 	(b)	 	All payments received by a Lender from or on behalf of the
Borrower under this Agreement in circumstances where such payment is
not being made pursuant to a provision of this Agreement providing
for the purpose for which such payment is to be made shall be
applied by such Lender as follows (i) first, in the pro rata
reduction of the Borrower’s obligation to pay any unpaid interest
and any fees

 

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	 	 	 	which are due and owing to the Lenders under this Agreement, (ii)
second, in reduction of the Borrower’s obligation to pay any claims
or losses referred to in Section 9.6, (iii) third, in the pro rata
reduction of the Borrower’s obligation to pay any amounts due and
owing to the Lenders on account of the principal amount of the
respective Loans, (iv) fourth, in the pro rata reduction of any
other obligation of the Borrower to the Lenders under this
Agreement and the other Loan Documents, and (v) fifth, to the
Borrower or such other Persons as may lawfully be entitled to or
directed to receive the remainder.

	2.8	 	Currency Indemnity

     Amounts owing under the U.S. Dollar Loan shall be repaid by the Borrower
to the U.S. Lender in U.S. Dollars and amounts owing under the Euro Loan shall
be repaid by the Borrower to the Euro Lender in Euros. Any payment on account
of an amount payable under any Loan Document in a particular currency (the
“proper currency”) made to or for the account of a Lender in a currency (the
“other currency”) other than the proper currency, whether pursuant to a
judgement or order of any court or tribunal or otherwise and whether arising
from the conversion of any amount denominated in one currency into any other
currency for the purpose of making or filing a claim, obtaining an order or
judgement, enforcing an order or judgement or otherwise, shall constitute a
discharge of the Borrower’s obligation to such Lender under such Loan Document
only to the extent of the amount of the proper currency which such Lender is
able, in the normal course of its business within one Business Day after
receipt by it of such payment, to purchase with the amount of the other
currency so received. If the amount of the proper currency which such Lender
is so able to purchase is less than the amount of the proper currency
originally due to it under such Loan Document, the Borrower shall indemnify and
save such Lender harmless from and against any loss or damage arising as a
result of such deficiency. This indemnity shall constitute an obligation
separate and independent from any other obligation contained in any Loan
Document, shall give rise to a separate and independent cause of action, shall
apply irrespective of any indulgence granted by either Lender from time to
time, shall continue in full force and effect notwithstanding any judgement or
order for a liquidated sum in respect of an amount due under any Loan Document
or under any judgement or order and shall not merge in any order of foreclosure
made in respect of any Security or other security given to or for the benefit
of the Lender. If the amount of the proper currency which a Lender so
purchases after receipt by it of such amount is greater than the amount of the
proper currency originally due to it under the Loan Documents such excess
amount shall be repaid to the Borrower.

	2.9	 	Taxes

     If the Borrower shall be required to deduct any Indemnified Taxes from any
payments of interest by or on account of any obligation of the Borrower
hereunder, then (i) the Borrower shall make such deduction, and (ii) the
Borrower shall pay the full amount deducted to the relevant Governmental Entity
in accordance with applicable law. The Borrower shall deliver to the
applicable Lender a copy of the Form NR4 or other information return reporting
such payment or other evidence of such payment of such Indemnified Taxes.

 

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     Any Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower at the time or
times prescribed by applicable law, such properly completed and executed
documentation prescribed by applicable law or reasonably requested by the
Borrower as will permit such payments to be made without withholding or at a
reduced rate.

     Each Lender shall take all steps reasonable necessary to claim from all
applicable Governmental Entities having taxing jurisdiction over such Lender or
its business a credit against or remission for or deduction from or other
available relief with respect to any Indemnified Taxes deducted by the Borrower
and paid by the Borrower to an applicable Governmental Entity as provided for
above (any of the foregoing being a “saving”). To the extent that the amount
of any saving from which a lender benefits is less than the amount of the
applicable Indemnified Taxes so deducted by the Borrower and paid to the
applicable Governmental Entity (any such amount being the “saving deficiency”),
the Borrower will, promptly following receipt of a written certificate from the
applicable Lender detailing such saving deficiency pay to the applicable Lender
the amount of the applicable saving deficiency. A Lender shall not be
considered to have benefited from any saving which has ceased to be available
due to the expiry of the carry forward period for such saving, if applicable,
and shall be considered to have realized any resulting deficiency resulting
therefrom at the time of such expiry.

     In this section the following terms have the following meanings, namely:

     “Indemnified Taxes” means all Taxes other than Excluded Taxes.

     “Excluded Taxes” means, in relation to either Lender, those taxes on
income, net income or capital or franchise taxes which are imposed or levied by
any jurisdiction or any political subdivision of such jurisdiction solely as a
result of such Lender (a) being organized under the laws of such jurisdiction
or any political subdivision of such jurisdiction, (b) having its principal
office or lending office in such jurisdiction, (c) being resident in such
jurisdiction, or (d) carrying on business in such jurisdiction with the
Borrower, or which would not have been imposed had such Lender satisfied a
relevant authority that such Lender was not a Person mentioned in clause (a),
(b), (c), (d) or (e) above.

     “Taxes” means taxes, levies, imposts, duties, charges, fees, deductions or
withholdings of any kind or nature whatsoever or any instalments, interest or
penalties payable with respect thereto now or in the future imposed, levied,
collected, withheld or assessed by Canada or any political subdivision of
Canada.

ARTICLE 3

LENDERS’ CONVERSION RIGHT

	3.1	 	Dassault Conversion Right

     Subject to obtaining the consent of the TSX to the Conversion Right as
referred to in Section 5.2(c) and subject to Section 3.2, each Lender shall
have the right (the “Conversion

 

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Right”), at such Lender’s sole option, at any time and from time to time
prior to the repayment in full of the Maturity Amounts, to convert all or any
part of the then outstanding principal amount of the Loan from such Lender,
together with accrued and unpaid interest thereon, (which, if less than the
entire unpaid principal amount and accrued and unpaid interest under such Loan,
is U.S. $100,000 (in the case of the U.S. Dollar Loan) or
€100,000 (in the
case of the Euro Loan), or an amount in excess thereof which is an integral
multiple of U.S. $100 or
€100, as the case may be, into that number of fully
paid and non-assessable Common Shares equal to the amount of the outstanding
principal amount (plus accrued and unpaid interest thereon) in respect of which
the Conversion Right is exercised (in U.S. Dollars for a conversion under the
U.S. Dollar Loan and the Equivalent Amount thereof in U.S. Dollars for a
conversion under the Euro Loan), divided by the Conversion Price in effect on
the applicable Conversion Date. The Lenders and the Borrower agree that such a
conversion shall constitute a subscription by the applicable Lender for the
Common Shares at the Conversion Price and a set-off of the subscription price
owing against the principal amount (together with accrued and unpaid interest
thereon) that is the subject of the conversion, and that such set-off shall
constitute payment in full of both such subscription price and such principal
amount and accrued and unpaid interest thereon.

     For the purposes of this Agreement, “Conversion Price” means (A) with
respect to any conversion to be effective on any Conversion Date on or before
December 31, 2004, U.S. $8.00 per Common Share, and (B) with respect to any
conversion to be effective on any Conversion Date after December 31, 2004, the
lesser of (i) U.S.$8.00 per Common Share and (ii) the market price per Common
Share on the Conversion Date for the applicable conversion. For the purposes
hereof, “market price” shall mean the weigheted average trading price of the
Common Shares on the TSX for the twenty (20) consecutive trading days ending
immediately prior to the applicable Conversion Date.

	3.2	 	Limitation on Conversion Right

     Under no circumstances may either Lender exercise the Conversion Right in
a manner which would result, following the exercise of the Conversion Right, in
the Lenders holding in excess of 19.9% of the total number of the then issued
and outstanding voting and participating shares of the Borrower (the “Borrower
Shares”). Where the exercise of a Conversion Right would cause the Lenders to
hold in excess of 19.9% of the Borrower Shares, the Conversion Right shall be
exercised only in respect of that portion of the Maturity Amount which would
result in the Lenders holding 19.9% of the Borrower Shares or, pursuant to
Section 3.1, the next lowest whole number of such shares; the balance of the
Maturity Amount, that, but for this Section 3.2, would be converted into
Borrower Shares, (i) may not be subject to any Conversion Right and (ii) shall
remain outstanding hereunder subject to being repaid by the Borrower to the
Lenders pursuant to the terms hereof.

	3.3	 	Conversion Right Exercise Procedure

     In order to exercise the Conversion Right, a Lender shall, prior to the
repayment in full of the Maturity Amounts under such Lender’s Loan, deliver to
the Borrower a written notice substantially in the form set out in Schedule 3.3
hereto (a “Conversion Notice”), duly signed by

 

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such Lender or its legal representatives or its attorney duly appointed by
an instrument in writing specifying the principal amount, and accrued and
unpaid interest thereon, of the Loan to be converted (the “Conversion Amount”)
and the date (the “Conversion Date”) upon which the conversion is to become
effective. Subject to the provisions of Section 3.2, upon delivery of such
written notice to the Borrower by a Lender:

	 	(a)	 	the applicable Lender shall be deemed for all purposes to
have subscribed for the number of Common Shares which such Lender
shall be entitled to receive pursuant to the exercise of such
Conversion Right by such Lender;
	 
	 	(b)	 	the applicable Lender shall have, and shall be deemed for all
purposes to have, agreed with the Borrower to set-off effective as
of the Conversion Date from all liability with respect to the
Conversion Amount against payment of the Conversion Price on the
Conversion Date for the Common Shares issuable upon such conversion;
and
	 
	 	(c)	 	such set-off of the Conversion Amount shall constitute full
payment of the Conversion Price on the Conversion Date for the
Common Shares issuable upon such conversion.

     As promptly as practicable after a Conversion Date, and in no event more
than fourteen (14) days following the Conversion Date, the Borrower shall issue
or cause to be issued and deliver or cause to be delivered to the applicable
Lender a certificate or certificates in the name such Lender for the number of
Common Shares deliverable upon the applicable conversion and provision shall be
made in respect of any fraction of a share as provided for below. Such
conversion shall be deemed to have been effected immediately at 10:00 a.m.
(Toronto time) on the Conversion Date and, at that time, all rights of the
applicable Lender under the Loan Documents in respect of the Conversion Amount
shall cease and the applicable Lender shall be deemed to have become on such
date the holder of record of the Common Shares issuable to it upon such
conversion; provided, however, that, if the Conversion Date is a date on which
the transfer registers for Common Shares is closed, the applicable Lender shall
become the holder of record thereof for all purposes at 10:00 a.m. (Toronto
time) on the next succeeding date on which such transfer registers are open.
No payment or adjustment shall be made upon any conversion on account of any
dividends on the Common Shares issuable upon conversion. Notwithstanding
anything herein contained, the Borrower shall in no case be required to issue
fractional Common Shares upon any conversion of all or any portion of any Loan.
If any fractional interest in a Common Share would, except for the provisions
of the preceding sentence, be deliverable upon any such conversion, the
Borrower shall satisfy such fractional interest by payment to the applicable
Lender of a cash amount equal (to the nearest cent or Equivalent Amount to such
cent) to the product of such fractional interest and the Conversion Price in
effect on the applicable Conversion Date. The Borrower warrants and covenants
that all Common Shares issued upon exercise of a Conversion Right shall be duly
and validly issued as fully paid and non-assessable.

 

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	3.4	 	Adjustments

     If following the date of this Agreement, but prior to any applicable
Conversion Date the Borrower (i) pays a dividend in Common Shares or makes a
distribution of Common Shares, in either case to holders of Common Shares, (ii)
subdivides its outstanding Common Shares, (iii) combines its outstanding Common
Shares into a smaller number of Common Shares, or (iv) issues by
reclassification or reorganization other securities of the Borrower to all
holders of Common Shares, the number of shares issuable upon the exercise of
such Conversion Right and the purchase price per share shall be adjusted as
determined by the board of directors of the Borrower in its sole discretion so
that the number of Common Shares or other securities of the Borrower to be
issued to the applicable Lender on the exercise of such Conversion Right shall
be the same kind and number of Common Shares or other securities of the
Borrower which such Lender would be entitled to if the applicable conversion
had taken place immediately prior to the event or record date with respect to
the actions in clauses (i) to (iv) above.

	3.5	 	Receipt

     Upon completion of the exercise of each Conversion Right, the applicable
Lender shall issue a receipt addressed to the Borrower acknowledging receipt of
the applicable Common Shares.

	3.6	 	Right of First Offer

     So long as (i) any amounts are owing to a Lender under the Loan Documents,
or (ii) the Lender or any of its Subsidiaries owns five percent (5%) or more of
the Borrower Shares, the Borrower shall provide the Euro Lender with prior
written notice (a “Notice of Sale”) of any proposal by the Borrower to sell,
transfer or otherwise dispose of (otherwise than pursuant to a Permitted Merger
or pursuant to a sale, transfer or other disposition to a Subsidiary of the
Borrower) any assets or portion of the business of the Borrower (detailing the
assets concerned) representing, in either case, in excess of 10% of the
consolidated revenues of the Borrower, determined in accordance with the most
recent audited financial statements of the Borrower (the “Right of First
Offer”). The Borrower shall not dispose of the assets or business described in
the Notice of Sale, in whole or in part, until the earliest of (i) its receipt
of a written offer from the Euro Lender or any of its Subsidiaries to purchase
such assets or business from the Borrower (in which case the Borrower may
dispose of such assets or business to the Euro Lender pursuant to such offer to
purchase or to any other Person for aggregate consideration which in the good
faith opinion reasonably held of the Borrower is greater than the consideration
to be paid by the Euro Lender pursuant to its offer to purchase); (ii) its
receipt of a written notice from the Euro Lender that the Euro Lender does not
wish to make an offer to purchase the assets, or (iii) 45 days following
delivery of the Notice of Sale to the Euro Lender.

 

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ARTICLE 4

INTEREST

	4.1	 	Interest

     From and after the Closing Date, the unpaid balance of each Loan, from
time to time, shall bear interest in respect of each day, both before and after
an Event of Default or judgment, at a rate of five and one half percent (5.5%)
per annum compounded quarterly (for the purpose of the Interest Act (Canada)
the effective annual rate of interest is 5.58% per annum) (the “Fixed Rate”).
Such interest shall be calculated (and compounded) quarterly in arrears, in
U.S. Dollars in the case of the U.S. Dollar Loan and in Euros in the case of
the Euro Loan, and payable on the first Business Day of each Financial Quarter
commencing on the first Business Day of January 2004 until all amounts owing to
the Lenders hereunder have been paid in full. For greater certainty and
without limitation, interest shall begin accruing on each Tranche of a Loan as
of the date on which such Tranche is advanced to the Borrower; the first
payment of interest on each Tranche of the Loans shall be made on the first
Business Day of January 2004 (which is the first Business Day of the first
Financial Quarter of 2004) which payment shall represent the interest accrued
between the date on which such Tranche was advanced to the Borrower and the
first Business Day of January 2004. The second payment of interest under each
Tranche of the Loans shall be made on the first Business Day of the second
Financial Quarter of 2004 which payment shall represent the interest accrued on
the Loans between the first Business Day of January 2004 and the first Business
Day of the second Financial Quarter of 2004 and so on for subsequent Financial
Quarters.

     For purposes of the Interest Act (Canada), (i) whenever any interest or
other amount under this Agreement is calculated using a rate based on a year of
360 days or 365 days, as the case may be, the rate determined pursuant to such
calculation, when expressed as an annual rate, is equivalent to (x) the
applicable rate based on a year of 360 days or 365 days, as the case may be,
(y) multiplied by the actual number of days in the calendar year in which the
period for which such interest or fee is payable (or compounded) ends, and (z)
divided by 360 or 365, as the case may be, (ii) the principle of deemed
reinvestment of interest does not apply to any interest calculation under this
Agreement, and (iii) the rates of interest stipulated in this Agreement are
intended to be nominal rates and not effective rates or yields.

ARTICLE 5

DELIVERIES

	5.1	 	Deliveries on Execution of this Agreement

     The Parties each respectively acknowledge that, immediately prior to or
concurrently with the execution and delivery of this Agreement:

	 	(a)	 	the Parties have closed the Other Lender Credit Agreement;

 

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	 	(b)	 	no Default or Event of Default has occurred or is continuing
or would arise immediately after giving effect to or as a result
from the execution and delivery of this Agreement;
	 
	 	(c)	 	the execution and delivery of this Agreement will not violate
any applicable law, order or judgment;
	 
	 	(d)	 	the representations and warranties of the Borrower contained
in Article 6 are true and correct on the date of the execution and
delivery of this Agreement as if such representations and warranties
were made on that date;
	 
	 	(e)	 	the Representative Lender has received, in form, substance,
scope and dated a date satisfactory to it and its counsel: certified
copies of:

	 	(i)	 	a certificate of status, compliance or like
certificate with respect to the Borrower issued by the
appropriate Governmental Entity of the Province of Ontario;
	 
	 	(ii)	 	the Loan Documents specified in Part I of
Schedule 7.1(p);
	 
	 	(iii)	 	evidence of registration of the Borrower’s
General Security Agreement in such jurisdictions as the Lender
may require;
	 
	 	(iv)	 	a full and final release of The Bank of Nova
Scotia addressed to the Borrower and the Representative Lender
in a form acceptable to the Lenders and their counsel acting
reasonably;
	 
	 	(v)	 	all discharges, subordination agreements, waivers
and confirmations as may be required to ensure that all
obligations under the Loan Documents are secured by Liens
(subject only to Permitted Liens) on the property and assets
of the Borrower with such exceptions as are permitted pursuant
to this Agreement or any of the other Loan Documents;
	 
	 	(vi)	 	a certificate of insurance with respect to the
insurance policies required pursuant to Section 7.1(j) showing
the Lender as an additional loss payee as its interests may
appear relative to the general property insurance carried with
respect to the Borrower;
	 
	 	(vii)	 	favourable opinions of counsel to the Borrower;
	 
	 	(viii)	 	a general summary of the key terms of each principal form of
compensation, commission and incentive plans in effect for the
employees, management and agents of the Borrower and its
Subsidiaries working in the Core Business, in a form
reasonably acceptable to the Lender and a copy of the form of
compensation, commission and incentive plans in effect for the
employees, management and agents of the Borrower

 

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	 	 	 	and its Subsidiaries working in the DS Products and Services Business; and
	 
	 	(ix)	 	approval of the TSX of the transactions contemplated herein; and

	 	(f)	 	the Euro Lender, the Borrower or their respective
Subsidiaries, as the case may be, shall have entered into the
following agreements with IBM (collectively, the “IBM Agreements”):

	 	(i)	 	IBM Marketing and Services Agreement between
IBM, and Borrower, dated June 18, 2002; and
	 
	 	(ii)	 	Joint Initiative Agreement between IBM (IGS) and
the Borrower, dated June 18, 2002.

	5.2	 	Conditions Precedent to the Advance of Each Tranche of the Loans

     Neither Lender shall make available a Tranche of a Loan unless all of the
following, to the extent that the same are applicable to such Tranche, have
occurred and/or are true:

	 	(a)	 	there shall exist no Default or Event of Default on the
applicable date on which such Tranche is to be advanced to the
Borrower and the advance of such Tranche to the Borrower would not
result in the occurrence of a Default or an Event of Default;
	 
	 	(b)	 	the representations and warranties contained in Article 6
shall be true in all material respects on and as of the applicable
date on which such Tranche is to be advanced to the Borrower, before
and after giving effect to such advance, with the same effect as if
such representations and warranties had been made on and as of such
date (except for any representation or warranty which by its terms
is given as of a specific date and except for the representation
under Section 6.1(o) to the extent, but only to the extent, that
such representation could be interpreted to be a representation that
none of the Euro Lender or any of its Subsidiaries are in default
under an agreement with the Borrower or any of it Subsidiaries);
	 
	 	(c)	 	the Borrower has received the approval of the TSX to the
Conversion Right, in respect of both Loans, to the entire
satisfaction of the Lenders and their legal counsel, acing
reasonably;
	 
	 	(d)	 	in the case of the first Tranche of each Loan to be advanced
on the First Tranche Advance Date, the aggregate end user revenue
for the CATIA, ENOVIA, SmarTeam, and DELMIA software products
generated by the Borrower and its Subsidiaries, during the period
form and including the date of this Agreement to and including
December 31, 2002, is equal to or greater than U.S. $8,000,000 (or
the Equivalent Amount in any other currencies); and

 

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	 	(e)	 	in the case of the second Tranche of each Loan to be advanced
on the Second Tranche Advance Date, the aggregate end user revenue
for CATIA, ENOVIA, SmarTeam, and DELMIA software products generated
by the Borrower and its Subsidiaries, during the period form and
including January 1, 2003 to and including June 30, 2003, is equal
to or greater than U.S. $10,500,000 (or the Equivalent Amount in any
other currencies).

	 	 	The revenues described in paragraphs (d) and (e) above shall be
determined, in respect of CATIA, ENOVIA and SmarTeam by a letter
describing such revenues from IBM addressed to the Representative Lender
and the Borrower. The revenues described in paragraphs (d) and (e) above
shall be determined, in respect of DELMIA, by a letter describing such
revenues from DELMIA addressed to the Representative Lender and the
Borrower.

ARTICLE 6

REPRESENTATIONS AND WARRANTIES

	6.1	 	Representations and Warranties

     The Borrower represents and warrants to each respective Lender,
acknowledging and confirming that the Lenders are relying on such
representations and warranties, without independent inquiry in entering into
this Agreement and providing the Loans, that:

	 	(a)	 	Incorporation and Qualification. The Borrower is a
corporation duly incorporated, organized and validly existing under
the laws of the Province of Ontario. Each of the Subsidiaries of the
Borrower is a corporation duly incorporated, amalgamated or
continued, as the case may be, and duly organized and validly
existing under the laws of its jurisdiction of incorporation as set
forth in Schedule 6.1(v)(i). Each of the Borrower and its
Subsidiaries is qualified, licensed or registered to carry on
business under the laws applicable to it in all jurisdictions in
which the failure to be so qualified, licensed or registered would
have a Material Adverse Effect.
	 
	 	(b)	 	Corporate Power. The Borrower and each of its Subsidiaries
has all requisite corporate power and authority to (i) own, lease
and operate its properties and assets and to carry on its business
as now being conducted by it, and (ii) enter into and perform their
respective obligations under the Loan Documents to which they are a
party;
	 
	 	(c)	 	Conflict With Other Instruments. The execution and delivery
by the Borrower and each of its Subsidiaries that are parties to the
Loan Documents and the performance thereby of their respective
obligations under, and compliance with the terms, conditions and
provisions of, the Loan Documents will not (i) conflict with or
result in a breach of any of the terms or conditions of (t) its
constating documents or by-laws, (u) any applicable law, rule or
regulation, (v) any contractual restriction binding on or affecting
it or its properties, or (w) any

 

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	 	 	 	judgment, injunction, determination or award which is binding on
it, except in any such case for any such conflict or breach which
would not have, and would not be reasonably expected to have, a
Material Adverse Effect, or (ii) result in, require or permit (x)
the imposition of any encumbrance in, on or with respect to any of
its assets or property (except in favour of the Security Agent),
(y) the acceleration of the maturity of any Funded Debt binding on
or affecting the Borrower or any of its Subsidiaries (except for
any rights which may be available to The Bank of Nova Scotia under
its lending arrangements with the Borrower, or (z) any third party
to terminate or acquire rights under any Material Agreement;
	 
	 	(d)	 	Corporate Action, Governmental Approvals, etc. The execution
and delivery of each of the Loan Documents by the Borrower and each
of its Subsidiaries that is a party thereto and the performance
thereby of their respective obligations under the Loan Documents
have been duly authorized by all necessary corporate action. No
authorization, consent, approval, registration, qualification,
designation, declaration or filing with any Governmental Entity or
other Person, is or was necessary in connection with the execution,
delivery and performance of obligations under the Loan Documents
except (a) for authorizations, consents, approvals, registrations,
qualifications, designations, declarations or filings which are in
full force and effect, unamended, at the date of this Agreement, (b)
any filings or registrations required to be made relative to the
Borrower’s General Security Agreement and the Borrower’s Specific
Security Agreements under applicable personal property security
legislation, (c) the consent of the TSX to the Conversion Right as
referred to in Section 5.2(c), and (d) any such other authorization,
consent, approval, registration, qualification, designation,
declaration or filing to the extent that the failure to have
obtained the same would not and could not reasonably be expected to
have a Material Adverse Effect;
	 
	 	(e)	 	Execution and Binding Obligation. This Agreement and the
other Loan Documents have been duly executed and delivered by the
Borrower and each of its Subsidiaries that is a party thereto and
constitute legal, valid and binding obligations of the Borrower and
such Subsidiaries enforceable against such Persons in accordance
with their respective terms, subject only to the exceptions and
qualifications set forth in the opinion, if any, of counsel for the
Borrower delivered to the Representative Lender in connection with
the closing of the transactions contemplated under this Agreement;
	 
	 	(f)	 	Authorizations, etc. The Borrower and each of its
Subsidiaries possess all authorizations, permits, consents,
registrations and approvals necessary to properly conduct their
respective businesses at full operating capacity, and all such
authorizations, permits, consents, registrations and approvals are
in good standing and in full force and effect, except to the extent
that the failure to possess any such authorization, permit, consent,
registration or approval, or for the same to be in full force and
effect, would not and could not reasonably be expected to have a
Material Adverse Effect;

 

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	 	(g)	 	Trademarks, Patents, etc. The Borrower and each of its
Subsidiaries possesses, licenses or otherwise has the right to use
all the trademarks, trade names, copyrights, patents and licenses
reasonably necessary for the conduct of their respective businesses,
except in any such case to the extent that the failure to do so
would not have, and would not be reasonably expected to have, a
Material Adverse Effect. To the best knowledge of the Borrower,
neither it nor any of its Subsidiaries is infringing or is alleged
to be infringing on the rights of any Person with respect to any
patent, trademark, trade name, copyright (or any application or
registration in respect thereof), license, discovery, improvement,
process, formula, know-how, data, plan or specification to the
extent that any such infringement or alleged infringement would not
have, and would not be reasonably expected to have, a Material
Adverse Effect;
	 
	 	(h)	 	No Infringement. The rights of the Borrower and its
Subsidiaries in or to the Intellectual Property currently owned by
the Borrower or its Subsidiaries, or licensed and used by the
Borrower or its Subsidiaries in an operational sense in the conduct
of the day to day operation of its business (but excluding for
greater certainty Intellectual Property, which is owned by third
parties and only sold or distributed by the Borrower or its
Subsidiaries in the course of their business), do not conflict with
or infringe (a) on the copyrights, trade secrets or know-how of any
other Person, and none of the Borrower or the Subsidiaries have
received any claim or written notice from any Person, to such effect
and (b) to the best knowledge of the Borrower and its Subsidiaries,
with the published patents or registered trademarks of any Person;
	 
	 	(i)	 	Ownership and Use of Property. Except for Permitted Liens,
each of the Borrower and its Subsidiaries has good and marketable
title in fee simple to the real properties which they own and good
and merchantable title to all the tangible and intangible personal
property reflected as assets being owned by it in their books and
records. The Borrower and each Subsidiary thereof owns, leases or
has the lawful right to use all of the assets necessary for the
conduct of their respective businesses at full operating capacity
except to the extent that the failure to have such right to use
would not and would not reasonably be expected to have a Material
Adverse Effect;
	 
	 	(j)	 	Compliance with Laws. Each of the real properties owned or
leased of the Borrower and its Subsidiaries have been used in
accordance with, and the Borrower and each of its Subsidiaries are
in compliance with, all applicable laws, judgments and orders and
rulings, guidelines and decisions having force of law except to the
extent that the failure to be in such compliance would not and
could not reasonably be expected to have a Material Adverse Effect;
	 
	 	(k)	 	No Default. Neither the Borrower nor any of its Subsidiaries
is in violation of its constating documents, its by-laws or any
shareholders’ agreement applicable to it;

 

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	 	(l)	 	No Material Adverse Agreements. Neither the Borrower nor any
of its Subsidiaries is a party to any agreement or instrument or
subject to any restriction (including any restriction set forth in
its constating documents, by-laws or any shareholders’ agreement
applicable to it) which has or , based on the facts and
circumstances in effect on the date of this Agreement could
reasonably be expected in the future to have a Material Adverse
Effect;
	 
	 	(m)	 	Environmental Compliance. Except as set out in Schedule
6.1(l), to the knowledge of the Borrower:

	 	(i)	 	none of the real properties owned or leased by
the Borrower or any of its Subsidiaries (i) has ever been used
by any Person as a waste disposal site or a landfill, or (ii)
has ever had any asbestos, asbestos-containing materials,
PCBs, radioactive substances or aboveground or underground
storage systems, active or abandoned, located on, at or under
it at the date of this Agreement;
	 
	 	(ii)	 	no properties adjacent to any of the real
properties owned or leased by the Borrower or any of its
Subsidiaries are contaminated;
	 
	 	(iii)	 	there are no contaminants located on, at or
under any of the real properties owned or leased by the
Borrower or any of its Subsidiaries; and
	 
	 	(iv)	 	neither the Borrower nor any of the Canadian
Subsidiaries has transported, removed or disposed of any waste
to a location outside of Canada as at the date of this
Agreement;

	 	(n)	 	Pension Plans. Neither the Borrower nor any of its
Subsidiaries (i) has any unfunded obligation under any pension plan,
or (ii) is a party to any pension plan which could create an
unfunded obligation of the Borrower or its Subsidiaries under such
plan;
	 
	 	(o)	 	Material Agreements, etc. The Borrower and its Subsidiaries
are in compliance in all material respects with all Material
Agreements and none of the Borrower or any of its Subsidiaries, or
to the best knowledge of the Borrower, any other party to any
Material Agreement, has defaulted in any material respect under any
of the Material Agreements. No event has occurred which, with the
giving of notice, lapse of time or both, would constitute a default
under, or in respect of, any Material Agreement. There is no
material dispute regarding any Material Agreement;
	 
	 	(p)	 	Labour Matters. There are no existing or, to the best
knowledge of the Borrower, threatened strikes, lock-outs or other
disputes relating to any collective bargaining agreement to which
the Borrower or any of its Subsidiaries is a party. None of the
Borrower nor any of its Subsidiaries is a party to any collective

 

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	 	 	 	agreement except for one collective agreement in Germany to which a
German Subsidiary of the Borrower is a party;
	 
	 	(q)	 	Books and Records. All books and records of the Borrower and
its Subsidiaries have been fully, properly and accurately kept and
completed and there are no material inaccuracies or discrepancies of
any kind contained or reflected therein. The Borrower’s and its
Subsidiaries’ books and records and other data and information are
available to the Borrower in the ordinary course of its business;
	 
	 	(r)	 	Tax Liability. The Borrower and each of its Subsidiaries
have filed all tax and tax-related information returns which are
required to be filed. The Borrower and each of its Subsidiaries
have paid all taxes, interest and penalties, if any, which have
become due pursuant to such returns or pursuant to any assessment
received by any of them other than those in respect of which
liability based on such returns is being contesting in good faith
and by appropriate proceedings where adequate reserves have been
established in accordance with GAAP. Adequate provision for
payment has been made in accordance with GAAP for taxes not yet due.
There are no tax disputes existing or, to the knowledge of the
Borrower, pending involving the Borrower, any of its Subsidiaries or
the Business which could reasonably be expected to have a Material
Adverse Effect;
	 
	 	(s)	 	Corporate Structure. At the date of this Agreement Schedule
6.1(r):

	 	(i)	 	there are no Subsidiaries of the Borrower other
than the Subsidiaries identified as such in Schedule 6.1(r);
and
	 
	 	(ii)	 	the share ownership of each of the Subsidiaries
of the Borrower is as described in Schedule 6.1(r);

	 	(t)	 	Subsidiaries, etc. None of the Borrower or any of its
Subsidiaries is an unlimited liability company nor do any of the
Borrower or any Subsidiary have any shares of or interests in any
unlimited liability company;
	 
	 	(u)	 	Financial Statements. The audited consolidated financial
statements of the Borrower for the Financial Year ended on December
31, 2001, copies of which have been furnished to the Representative
Lender, fairly present the consolidated financial position of the
Borrower at such date and the consolidated results of the operations
and changes in financial position of the Borrower for the period
then ended, all in accordance with GAAP;
	 
	 	(v)	 	Reporting Issuer. The Borrower is a reporting issuer in each
of the provinces of Canada and it not in default of its obligations
as such under securities legislation or regulations to which it is
subject. No securities commission or similar regulatory authority
has issued any order preventing or suspending trading in any
securities of the Borrower;

 

 

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	 	(w)	 	Permitted Liens. Each of the personal property registrations
described in Schedule 6.1(w) against the Borrower in favour of the
secured parties (the “Specified Secured Parties”) identified in
Schedule 6.1(w) only perfect a Lien upon property or assets of the
Borrower which constitute Permitted Liens and do not perfect or
otherwise relate to any Lien generally upon all of or substantially
all of the property and assets of the Borrower; and none of the
Specified Secured Parties have rights under such Liens, or under the
agreements creating the indebtedness secured by such Liens, which
materially adversely affect, or could reasonably be expected to
materially adversely affect, the rights of the Lenders under the
Loan Documents;
	 
	 	(x)	 	Schedule Disclosure At the date of this Agreement:

	 	 	 	Schedule 6.1(v)(i) is a list of (i) the chief executive
office, head office, registered office and chief place of
business of the Borrower, (ii) the jurisdictions in which the
Borrower carries on business, (iii) the jurisdictions in
which the Borrower has any account debtors, (iv) the
jurisdictions in which the Borrower stores any tangible
personal property (except for goods in transit in the
ordinary course of business), and (v) the office addresses of
all of the Borrower and its Subsidiaries identifying on such
list the fifteen (15) largest of its Subsidiaries of the
Borrower, determined by revenues in 2001;
	 
	 	 	 	Schedule 6.1(v)(ii) is a list of all authorizations, permits,
consents, registrations and approvals which are material to
the Borrower;
	 
	 	 	 	Schedule 6.1(v)(iii) is a list of all trademarks, tradenames,
copyrights and patents (and the registration particulars
thereof) which are material to the Borrower;
	 
	 	 	 	Schedule 6.1(v)(iv) is a list of all actions, suits,
arbitrations or proceedings pending, taken or, to the
Borrower’s knowledge threatened, before or by any
Governmental Entity or other Person affecting the Borrower or
any of its Subsidiaries involving claims which individually
or in the aggregate exceed U.S. $100,000; and
	 
	 	 	 	Schedule 6.1(v)(v) contains a list of all Material
Agreements.

	 	(y)	 	Disclosure. All written information respecting the Borrower
supplied by the Borrower to the Lenders (i) was prepared in good
faith, adequately disclosed all relevant assumptions, is reasonable
and (ii) is true and accurate in all material respects. There is no
fact known to the Borrower which could reasonably be expected to
have a Material Adverse Effect and which has not been fully
disclosed. Subject to the preceding provisions of this section, no
event has occurred which could be reasonably anticipated to have a
Material Adverse Effect

 

 

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	 	 	 	since the date of the last audited financial statements delivered
to the Representative Lender; and
	 
	 	(z)	 	Compensation Plans. The Summary of Compensation, Commission
and Incentive Plans delivered to the Representative Lender on or
about the date of this Agreement contains a true and accurate
description of the material terms of the compensation, commission
and incentive plans described in such Summary and such plans are in
effect, or are to be in effect at the dates indicated in such
Summary, for the employees, management and agents of the Borrower
and its Subsidiaries working in the Core Business. Such compensation
plans will be applied by the Borrower to all employees working in
the Core Business, in accordance with the Business Plan.

6.2 Survival of Representations and Warranties.

     The representations and warranties in this Agreement and in any other Loan
Document shall not merge in or be prejudiced by, and shall survive (but for
greater certainty not be deemed to be repeated following) the initial advance
and shall continue in full force and effect so long as any amounts are owing by
the Borrower to either Lender under this Agreement.

ARTICLE 7

COVENANTS OF THE BORROWER

7.1 Affirmative Covenants

     So long as any amount owing by the Borrower or any of its Subsidiaries
under the Loan Documents remains unpaid, and unless consent is given in
accordance with Section 9.1, the Borrower shall:

	 	(a)	 	Financial Reporting. Deliver to the Representative Lender
promptly (and in any event within 2 Business Days) following filing
the same with Canadian securities regulators the quarterly and
annual financial statements of the Borrower filed from time to time
by the Borrower with Canadian securities regulators pursuant to the
Borrower’s continuous disclosure obligations under Canadian
securities legislation, and (ii) together with each delivery of such
financial statements, a certificate (a “Compliance Certificate”) of
the Borrower substantially in the form of Schedule 7.1(a) signed on
its behalf by its president, chief executive officer, chief
operating officer, chief financial officer or treasurer (or any
other officer of the Borrower with the duties and responsibilities
of any such office notwithstanding that the title of such officer
may be different than those specified above) any other officer
acceptable to the Representative Lender;
	 
	 	(b)	 	Environmental Reporting. Promptly, and in any event within
10 days, deliver to the Representative Lender a detailed statement
describing any of the following occurrences (i) any order or
judgment of any Governmental Entity requiring the Borrower or any of
its Subsidiaries to incur Environmental Liabilities (w) in

 

 

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	 	 	 	excess of $1,000,000 in any one instance, (x) together with all
other expenditures incurred in respect of Environmental Liabilities
in any Financial Year, in excess of $1,000,000 in the aggregate,
(ii) any state of affairs on any of the Subject Properties which
could result in the incurrence of Environmental Liabilities (y) in
excess of $1,500,000 in any one instance, or (z) together with all
other expenditures incurred in respect of Environmental Liabilities
in any Financial Year, in excess of $1,500,000 in the aggregate,
and (iii) the action taken or proposed to be taken in connection
with such occurrences;
	 
	 	(c)	 	Corporate Existence. Except for Permitted Mergers and except
as otherwise permitted in this Agreement, preserve and maintain, and
cause each of its Subsidiaries to preserve and maintain, its
corporate existence;
	 
	 	(d)	 	Compliance with Laws, etc. Comply, and cause each of its
Subsidiaries to comply with the requirements of all applicable laws,
judgments, orders, decisions and awards except to the extent that
the failure to so comply would not and could not be reasonably
expected to have a Material Adverse Effect;
	 
	 	(e)	 	Maintenance of Properties. From time to time, make and cause
each of the Subsidiaries of the Borrower to make all repairs,
renewals, replacements, additions and improvements to the real
properties owned or leased by the Borrower and its Subsidiaries and
their other properties and assets, so that the DS Products and
Services Business and the Borrower’s Subsidiaries’ respective
businesses, as the case may be, may be properly and advantageously
conducted at all times in accordance with prudent business
management practice;
	 
	 	(f)	 	Auditors. Continue to appoint as its auditors a firm of
national standing in Canada;
	 
	 	(g)	 	Payment of Taxes and Claims. Pay or cause to be paid and
cause each of its Subsidiaries to pay or cause to be paid, when due,
(i) all taxes, assessments and governmental charges or levies
imposed upon it or upon its income, sales, capital or profit or any
other property belonging to it or upon its Subsidiaries, and (ii)
all claims which, if unpaid, might by law become a Lien upon the
assets, except any such tax, assessment, charge, levy or claim
which (x) is being contested in good faith and by proper proceedings
and in respect of which the Borrower or its Subsidiaries have
established adequate reserves in accordance with GAAP or (y) are
Permitted Liens;
	 
	 	(h)	 	Keeping of Books. Keep, and cause each of the Subsidiaries
of the Borrower to keep, proper books of record and account, in
which full and correct entries shall be made in respect of the DS
Products and Services Business or businesses, as the case may be;
	 
	 	(i)	 	Visitation and Inspection. At any reasonable time or times
during normal business hours and on reasonable notice to the
Borrower, permit either Lender to

 

 

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	 	 	 	visit the properties of the Borrower and its Subsidiaries, and to
discuss their affairs, finances and accounts with the officer
appointed as (or performing the functions of) the chief financial
officer of the Borrower;
	 
	 	(j)	 	Maintenance of Insurance. Maintain, in respect of itself and
each of the Borrower’s Subsidiaries, insurance at all times with
responsible insurance carriers and in such amounts and covering such
risks as are usually carried by companies engaged in similar
businesses and owning similar properties in the same general areas
in which the Borrower or such Subsidiaries, as the case may be,
operate, such policies with respect to the general corporate
liabilities, property and assets of the Borrower and show the
Security Agent as an additional loss payee (for property insurance
on the property of the Borrower) as its interests may appear under a
mortgage clause in a form approved by the Insurance Bureau of Canada
(it being agreed that, provided that no Event of Default has
occurred and is then continuing, any amounts from time to time
payable under any such insurance shall be released to the Borrower
to be used by the Borrower to repair or replace the applicable asset
or property or otherwise used by the Borrower for the purpose of
carrying on its business in the ordinary course);
	 
	 	(k)	 	DS Products and Services Business. The Borrower and its
Subsidiaries will, pursuant the Business Plan and any replacement
thereof pursuant to the terms hereof: (i) continue to carry on the
Core Business (other than the DS Products and Services Business),
(ii) begin and subsequently continue to carry on the DS Products and
Services Business, (iii) ensure that the business activities of the
Borrower and its Subsidiaries are comprised primarily and
substantially of the Core Business, (iv) ensure that the DS Products
and Services Business comprises a material part of the business
activities of the Borrower and its Subsidiaries and (v) not make any
changes to Items (i)-(iv) above;
	 
	 	(l)	 	Annual Business Plan.. Beginning upon the expiry of the term
of the Business Plan, being thirty (30) days prior to the end of the
2004 calendar year, and no less than thirty (30) days prior to the
end of each subsequent calendar year, so long as the Borrower is
liable for any amounts hereunder to either Lender, the Borrower
shall deliver to the Representative Lender a business plan relative
to the DS Products and Services Business for the year to follow in a
form reasonably acceptable to the Representative Lender;
	 
	 	(m)	 	[***]. The Borrower will cause each of [***] and [***] to
remain active members of the executive management of the Borrower
for a period of at least 5 years from the date of this Agreement
subject to the unavailability of any such Person to be so involved
at any time during such 5 year period as a consequence of illness,
disability, disappearance, death or other casualty;
	 
	 	(n)	 	Further Assurances. Upon request of the Representative
Lender, execute and deliver or cause to be executed and delivered to
the Representative Lender such further instruments and do and cause
to be done such further acts as may be

 

 

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	 	 	 	necessary or proper in the reasonable opinion of the Representative
Lender to carry out more effectively the provisions and purposes of
the Loan Documents;
	 
	 	(o)	 	Assignment of IBM Agreement. If the Euro Lender or a
Subsidiary of the Euro Lender, upon thirty (30) days written notice
to the Borrower, assumes by way of assignment all of IBM’s rights
and obligations under the IBM Agreements, the Borrower shall,
without prejudice to any rights and claims that it may have at such
time under any such agreements against IBM, agree to consent to such
assignment and to recognize the Euro Lender or such Subsidiary as
the successor counterparty to the Borrower under such IBM
Agreements; the Borrower also covenants that, following any such
assignment and consent from the Borrower as provided for above, the
Borrower, if requested by the Representative Lender, shall enter
into a marketing and services agreement with the Lender, or its
designated Subsidiary, within thirty (30) days of such request in
replacement of the IBM Agreements so assigned to the Lender or its
Subsidiary provided that the terms of such new agreement are not
materially less favourable to the Borrower than those of the IBM
Agreements so assigned;
	 
	 	(p)	 	Borrower’s Specific Security Agreements. Within forty-five
(45) days from and after the date of this Agreement, the Borrower
will execute and deliver, or cause to be executed and delivered, as
the case may be, to the Security Agent the Borrower’s Specific
Security Agreements identified in Part II of Schedule 7.1(p) and
will provide the Security Agent with evidence satisfactory to the
Security Agent, acting reasonably, of all registrations and filings
having been made that are deemed required or necessary in the
reasonable opinion of the Security Agent or its legal counsel in the
applicable jurisdictions where such Specific Collateral is located
to preserve, protect or perfect, as applicable, the Lien of the
Security Agent under such Borrower’s Specific Security Agreements in
the Specific Collateral charged thereunder as a first priority Lien,
subject only to Permitted Liens (the date on which such Borrower’s
Specific Security Agreements and evidence of registrations and
filings are delivered to the Security Agent being the “Specific
Security Delivery Date”); and
	 
	 	(q)	 	Approval of the TSX. The Borrower shall obtain approval for
the Conversion Right in respect of the whole of both Loans
contemplated herein within seven (7) months of the date hereof.

7.2 Negative Covenants

     So long as any amount owing by the Borrower or any of its Subsidiaries
under the Loan Documents remains unpaid, and unless consent is given in
accordance with Section 9.1 (such consent not to be unreasonably withheld or
delayed in respect of Sections 7.2(a), 7.2(f) and 7.2(g) only), the Borrower
shall not:

	 	(a)	 	Funded Debt. Create, incur, assume or suffer to exist or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist any Funded Debt other

 

 

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	 	 	 	than, without duplication, (i) Funded Debt to the Lenders under
this Agreement, (ii) Funded Debt under the Other Lender Credit
Agreement, (iii) Funded Debt from time to time under one or more
Permitted Senior Credit Facilities (subject to the maximum
aggregate principal amount of the indebtedness permitted to be
outstanding at such time under all such Senior Permitted Credit
Facilities pursuant to the definition of the term ‘Permitted Senior
Credit Facilities’), (iv) Funded Debt secured by any Permitted Lien
(subject to the limitations on the indebtedness permitted to be
secured by such Permitted Lien pursuant to the definition of the
term ‘Permitted Lien’), (v) Funded Debt of up to U.S. $6,000,000
advanced to the Borrower on or about the Closing Date as an advance
for certain services to be rendered by the Borrower, (vi) any
refinancing, replacement or renewal of such Funded Debt not
exceeding (y) in principal amount, the amount outstanding on the
date of the refinancing, renewal or replacement, and (z) in
interest rate, a market competitive rate on the date of the
refinancing, renewal or replacement, and otherwise on terms and
conditions no more restrictive than the terms and conditions of the
Funded Debt to be refinanced, renewed or replaced, and (iv)
additional unsecured Funded Debt not otherwise permitted pursuant
to this Section in a principal amount not in excess of
U.S.$5,000,000 (or the Equivalent Amount in any other currencies)
in the aggregate outstanding at any one time;
	 
	 	(b)	 	Liens. Create, incur, assume or suffer to exist, or permit
any of the Borrower’s Subsidiaries to create, incur, assume or
suffer to exist, any Lien on any of their respective properties or
assets other than Permitted Liens;
	 
	 	(c)	 	Mergers, Etc. Enter into, or permit any of the Borrower’s
Subsidiaries to enter into, any reorganization, consolidation,
amalgamation, arrangement, winding-up, merger or other similar
transaction (any such transaction being a “Merger Transaction”)
except for a Permitted Merger.
	 
	 	(d)	 	Disposal of Assets Generally. Sell, exchange, lease, release
or abandon or otherwise dispose (a “Disposition”) of, or permit any
of its Subsidiaries to Dispose of, any assets or properties in
excess of U.S. $3,000,000 (or the Equivalent Amount in any other
currency or currencies) to any Person other than (i) bona fide
sales, exchanges, leases, abandonments or other dispositions in the
ordinary course of business for the purpose of carrying on the Core
Business or the Subsidiary’s business, as the case may be, and at
fair market value, (ii) property or assets which have no material
economic value in the Core Business or the Subsidiary’s business or
are obsolete.
	 
	 	(e)	 	Share Capital. Issue Common Shares, or any options, warrants
or securities convertible into Common Shares, representing more than
15% of the Common Shares outstanding at the time of such issuance,
except for Commons Shares and any such options, warrants or
securities convertible into Common Shares issued pursuant to the
exercise of Conversion Rights or the exercise of any conversion
rights under the Other Lender Credit Agreement;

 

 

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	 	(f)	 	Subsidiaries. Acquire any Subsidiary or business for an
aggregate consideration in excess of U.S. $5,000,000 (or the
Equivalent Amount in any other currencies);
	 
	 	(g)	 	Financial Year. Except as a result of a Permitted Merger,
change its Financial Year without the prior written approval of the
Representative Lender;
	 
	 	(h)	 	Amendments. Allow any amendments to any Material Agreement
if such amendments could reasonably be expected to have a Material
Adverse Effect;
	 
	 	(i)	 	Contaminants, etc. Permit any asbestos, asbestos-containing
materials, PCBs, radioactive substances or other contaminants which
could be the subject of a clean-up order to be located on, at or
under any of the real properties owned or leased by the Borrower or
a Subsidiary thereof. Permit any underground storage vessels to be
located or installed at any of the real properties owned or leased
by the Borrower or a Subsidiary thereof;
	 
	 	(j)	 	No Private Placements. The Borrower will not issue, by way
of private placement any Common Shares (other than shares issuable
upon exercise of the Conversion Right under the Other Lender Credit
Agreement, under employee stock option plans existing on the date of
this Agreement or under employee stock options entered into after
the date of this Agreement consistent with past practices, or any
securities convertible into Common Shares (other than employee stock
options entered into after the date of this agreement consistent
with past practices), prior to obtaining the approval of the
Conversion Right as contemplated by Section 5.2(c) of this
Agreement; and
	 
	 	(k)	 	No Quebec Liens. Without limitation to the other obligations
of the Borrower hereunder, until such time as the Borrower has
fulfilled all of its obligations under Section 0, neither the
Borrower nor any of its Subsidiaries shall grant any Lien in the
Province of Quebec.

7.3 Financial Covenant

     So long as any amount owing by the Borrower or any of its Subsidiaries
under the Loan Documents remains unpaid, and unless consent is given in
accordance with Section 9.1, the Borrower shall maintain, at all times, a ratio
of Adjusted Consolidated Funded Debt (calculated as at the end of the most
recently completed Financial Quarter) to Consolidated Equity (calculated as at
the end of the most recently completed Financial Quarter) of at least 1.0 to
1.0.

     For the purposes of this Section 7.3:

	 	 	 	“Adjusted Consolidated Funded Debt” means at any time the amount,
if any, by which the Funded Debt of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with
GAAP at such time exceeds Consolidated Cash and Short Term
Investments at such time;

 

 

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	 	 	 	“Consolidated Cash and Short Term Investments” means, on any date,
all cash and all debt securities or debt investments (including
without limitation bankers’ acceptances, government obligations,
financial institution deposit certificates or debt obligations and
commercial paper) which have terms to maturity of not more than 1
year from and including such date held on such date by the Borrower
and its Subsidiaries, determined on a consolidated basis in
accordance with GAAP; and
	 
	 	 	 	“Consolidated Equity” means, at any time, the amounts which would,
on a consolidated basis in accordance with GAAP, then be included
as shareholders’ equity, retained earnings or contributed surplus
on a balance sheet of the Borrower and its Subsidiaries.

7.4 Security Covenants

     So long as any amount owing by the Borrower or any of its Subsidiaries
under the Loan Documents remains unpaid, and unless consent is given in
accordance with Section 9.1, the Borrower shall:

	 	(a)	 	Status of Accounts Collateral. With respect to the
Collateral and Specific Collateral (i) maintain books and records
pertaining to the Collateral and Specific Collateral in such detail,
form and scope as the Representative Lender reasonably requires, and
(ii) report immediately to the Representative Lender any matters
materially adversely affecting the value, enforceability or
collectibility of the Collateral and Specific Collateral, taken as a
whole;
	 
	 	(b)	 	Business Outside Certain Jurisdictions. At least 30 days
prior to any of the following changes becoming effective, notify the
Representative Lender in writing of (i) any proposed change in the
location of (w) any place of business of the Borrower, (x) the chief
executive office or head office of the Borrower, (y) any account
debtors of the Borrower, and (z) any place where tangible property
of the Borrower is stored, and (ii) any proposed change in the name
of the Borrower;
	 
	 	(c)	 	Perfection and Protection of Security Interest. Promptly
cure or cause to be cured any defects in the execution and delivery
of any of the Loan Documents or any defects in the validity or
enforceability of any of the Security and execute and deliver or
cause to be executed and delivered, all such agreements, instruments
and other documents (including the filing of any financing
statements or financing change statements) as the Representative
Lender may consider necessary or desirable to protect or otherwise
perfect the Security;
	 
	 	(d)	 	Release of Security. On the date of the due payment and
performance in full of all Maturity Amounts (including as a
consequence of the exercise of a Conversion Right or successive
Conversion Rights), under both Loans to both Lenders this Agreement
shall terminate, and promptly after such date and the due payment
and performance in full of all ‘Maturity Amounts’ (as defined in the
Other Lender

 

 

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	 	 	 	Loan Agreement) (including as a consequence of the exercise of a
‘Conversion Right’ or successive ‘Conversion Rights’ (as defined in
the Other Lender Loan Agreement)), under both ‘Loans’ (as defined
in the Other Lender Loan Agreement) to both Lenders, the Lenders
will release and discharge, and will cause the Security Agent to
release and discharge, the Security and all right, title and
interest of the Security Agent and the Lenders in the property and
assets of the Borrower and its Subsidiaries under the Security. In
addition, if any asset or property of the Borrower or a Subsidiary
thereof is Disposed of as specifically permitted by this Agreement,
the Lenders, at the request of the Borrower, will, and will cause
the Security Agent to, discharge such asset or property from the
Security and deliver and re-assign to the Borrower or the
applicable Subsidiary (without any representation or warranty) any
such asset or property then in the possession of the Lenders or the
Security Agent provided, however, that (i) the Borrower or one of
its Subsidiaries, as the case may be, concurrently with any such
discharge of Specific Collateral under the Borrower’s Specific
Security Agreements, grant Security to the Security Agent over
another asset of the Borrower or one of its Subsidiaries of equal
or greater value to the Specific Collateral so disposed of and (ii)
that the aggregate value of all the Special Collateral combined
remains unchanged or increases. If any Liens are permitted to be
placed over any part of the assets or property of the Borrower or
any of its Subsidiaries (whether in priority to any of the Security
or otherwise) pursuant to the provisions of this Agreement, or
otherwise at the direction or with the consent of the Lenders, the
Lenders shall, at the request of the Borrower, will, and will cause
the Security Agent to, provide such assurances, confirmations,
postponements and subordinations respecting such assets and
property and the Security as the Borrower may reasonably request in
the circumstances.

Quebec Hypothec. Within five (5) Business Days following the Closing Date, the
Borrower shall do all things reasonably necessary to cause the Hypothec to be
registered with the Quebec Register of Personal and Movable Real Rights and
deliver an opinion thereon of its legal counsel to the Representative Lender in
a form acceptable to the Representative Lender and its legal counsel, acing
reasonably.

7.5 Authorization and Action of Security Agent

     Each Lender irrevocably appoints and authorizes the Security Agent to take
such action as agent on its behalf and to exercise such powers under this
Agreement and the other Loan Documents as are delegated to it by the terms of
this Agreement and the other Loan Documents, together with all powers
reasonably incidental thereto. As to any matters not expressly provided for by
this Agreement or any other Loan Document, the Security Agent shall act or
refrain from acting (and shall be fully protected in so doing) upon the joint
instructions of both Lenders.

7.6 Holding of Security; Sharing of Payments, etc.

     The Security shall be held by the Security Agent for the benefit of both
of the Lenders in accordance with its terms and any proceeds from any
realization of the Security shall be applied

 

 

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to the Loans made by each Lender rateably (whether such Security is held
in the name of the Security Agent or in the name of any one or both of the
Lenders and without regard to any priority to which the Lender may otherwise be
entitled under applicable law).

ARTICLE 8

EVENTS OF DEFAULT

8.1 Events of Default

     If any of the following events (each an “Event of Default”) occurs and is
continuing:

	 	(a)	 	the Borrower fails to pay any principal or interest in
respect of a Loan when such amount becomes due and payable and such
failure remains unremedied for a period of [***] Business Days;
	 
	 	(b)	 	any representation or warranty or certification made or
deemed to be made by the Borrower or any of its Subsidiaries thereof
in any Loan Document shall prove to have been incorrect in any
material respect when made or deemed to be made; and, if the
circumstances giving rise to the materially incorrect representation
or warranty are capable of modification or rectification (such that,
thereafter the representation or warranty would not be incorrect in
any material respect), the representation or warranty remains
uncorrected for a period of [***] days following written notice of
such material incorrectness by the Representative Lender to the
Borrower;
	 
	 	(c)	 	the Borrower fails to perform or observe or comply with any
of the covenants contained in Section 7.2 (Negative Covenants) or
Section 7.3 (Financial Covenant), or its obligations in Section 2.4
(Change of Control) to make an offer to repay the Loans as required
by Section 2.4, or to make a repayment of a Loan in the full amount
required as a result of acceptance of any such offer by the
Representative Lender, and in any such case such failure remains
unremedied for [***] days following notice of such failure by the
Representative Lender to the Borrower;
	 
	 	(d)	 	the Borrower fails to perform, observe or comply with any of
the covenants contained in Section 7.1 (Affirmative Covenants) and
such failure remains unremedied for [***] days following notice of
such failure by the Representative Lender to the Borrower;
	 
	 	(e)	 	a Subsidiary of the Borrower fails to perform or observe or
comply with any material term or agreement contained in any Loan
Document to which it is a party and such failure remains unremedied
for [***] days following notice of such failure by the
Representative Lender to the Borrower;
	 
	 	(f)	 	except as specifically permitted pursuant to the terms of the
Memorandum of Understanding between the Parties executed on April
16, 2002, prior to the

 

 

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	 	 	 	payment in full of all amounts owing by the Borrower and its
Subsidiaries under the Loan Documents, the Borrower shall, on its
own behalf or on behalf of any other Person, whether directly or
indirectly, in any capacity whatsoever, alone, through or in
connection with any Person, carry or be engaged in or have any
financial or other interest in or be otherwise commercially
involved in any endeavour, activity or business for the
distribution of software products that are competitive or
substantially similar to those of the Euro Lender or its
Subsidiaries other than as specifically permitted pursuant to the
IBM Agreements;
	 
	 	(g)	 	the Borrower fails to perform, observe or comply with any
other term, covenant or agreement contained in any Loan Document and
such failure remains unremedied for [***] days following written
notice of such failure by the Representative Lender to the Borrower;
	 
	 	(h)	 	an event of default (as defined in the Other Lender Credit
Agreement) has occurred and is continuing under the Other Lender
Credit Agreement;
	 
	 	(i)	 	if an event or events of default, as defined in any one or
more indentures or instruments evidencing or under which the
Borrower or any of its Subsidiaries has incurred Funded Debt in an
aggregate principal amount in excess of [***] (or the Equivalent
Amount in any other currencies) shall happen and be continuing and
(i) shall consist of a failure to make any payment when due and
payable of any amount or amounts (whether principal, interest or
both) exceeding in the aggregate under all such indentures and
instruments [***] (or the Equivalent Amount in any other currency or
currencies), or (ii) shall have resulted in the acceleration of such
Funded Debt so that Funded Debt in an aggregate amount (whether
principal, interest or both) under all such indentures and
instruments in excess of [***] (or the Equivalent Amount in any
other currencies) shall be or become due and payable prior to the
date on which the same would otherwise have become due and payable;
provided, however, that if such event or events of default under
such indentures or instruments is remedied or cured by the Borrower
or its Subsidiaries, or waived by the holders of such Funded Debt,
then the Event of Default occurring by reason thereof shall be
deemed likewise to have been thereupon remedied, cured or waived
without further action;
	 
	 	(j)	 	any judgment or order for the payment of money in excess of
[***] (or the Equivalent Amount in any other currencies) (subject to
no further right of appeal) is rendered against the Borrower or any
of its Subsidiaries and enforcement proceedings have been commenced
by a creditor upon the judgment or order and such proceedings have
not been effectively stayed; or
	 
	 	(k)	 	except for Permitted Mergers the Borrower or any of its
Subsidiaries (i) becomes insolvent or generally not able to pay its
debts as they become due, (ii) admits in writing its inability to
pay its debts generally or makes a general assignment for the
benefit of creditors, (iii) institutes or has instituted against it
any proceeding seeking (x) to adjudicate it a bankrupt or insolvent,
(y) liquidation, winding-up,

 

 

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	 	 	 	reorganization, arrangement, adjustment, protection, relief or
composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors
including any plan of compromise or arrangement or other corporate
proceeding involving or affecting its creditors, or (z) the entry
of an order for relief or the appointment of a receiver, trustee or
other similar official for it or for any substantial part of its
properties and assets, and in the case of any such proceeding
instituted against it (but not instituted by it), either the
proceeding remains undismissed or unstayed for a period of [***]
days, or any of the actions sought in such proceeding (including
the entry of an order for relief against it or the appointment of a
receiver, trustee, custodian or other similar official for it or
for any substantial part of its properties and assets) occurs, or
(iv) takes any corporate action to authorize any of the above
actions;

	 	 	then either Lender may by written notice to the Borrower (x) terminate
its obligation to advance any Tramche of its Loan which it has not yet
advanced under this Agreement, and (y) may declare its Loan, all accrued
interest and all other amounts payable under this Agreement to be
immediately due and payable, without presentment, demand, protest or
further notice of any kind, all of which are expressly waived by the
Borrower.

8.2 Remedies Upon Default

	(1)	 	Upon a declaration that a Loan is immediately due and payable pursuant to
this Article 8, the Lender that has made the declaration may commence such
legal action or proceedings as it, in its sole discretion, deems
expedient, including, the commencement of enforcement proceedings under
the Loan Documents all without any additional notice, presentation,
demand, protest, notice of dishonour, entering into of possession of any
property or assets, or any other action or notice, all of which are
expressly waived by the Borrower.
	 
	(2)	 	The rights and remedies of the Lenders under the Loan Documents are
cumulative and are in addition to, and not in substitution for, any other
rights or remedies. Nothing contained in the Loan Documents with respect
to the indebtedness or liability of the Borrower to the Lenders, nor any
act or omission of the Lenders with respect to the Loan Documents or the
Security shall in any way prejudice or affect the rights, remedies and
powers of the Lenders under the Loan Documents and the Security.

ARTICLE 9

MISCELLANEOUS

9.1 Amendments, etc.

     No amendment or waiver of any provision of any of the Loan Documents, nor
consent to any departure by the Borrower or any other Person from such
provisions, is effective unless in writing and approved by the Representative
Lender. Any amendment, waiver or consent is effective only in the specific
instance and for the specific purpose for which it was given.

 

 

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9.2 Waiver

	 	(a)	 	No failure on the part of a Lender to exercise, and no delay
in exercising, any right under any of the Loan Documents shall
operate as a waiver of such right; nor shall any single or partial
exercise of any right under any of the Loan Documents preclude any
other or further exercise of such right or the exercise of any other
right.
	 
	 	(b)	 	Except as otherwise expressly provided in this Agreement, the
covenants, representations and warranties shall not merge on and
shall survive the initial advance and, notwithstanding such initial
advance or any investigation made by or on behalf of any party,
shall continue in full force and effect. The closing of this
transaction shall not prejudice any right of one party against any
other party in respect of anything done or omitted under this
Agreement or in respect of any right to damages or other remedies.

9.3 Evidence of Funded Debt.

     The indebtedness of the Borrower hereunder shall be evidenced by the
records of the Lender which shall constitute prima facie evidence of such
indebtedness.

9.4 Notices, etc

     Any notice, direction or other communication to be given under this
Agreement shall, except as otherwise permitted, be in writing and given by
delivering it or sending it by facsimile or other similar form of recorded
communication addressed:

	 	(a)	 	to the Borrower at:

	 	 	 	5285 Solar Drive

Mississauga, Ontario

Canada L4W 5B8

Attention: Rui Malhinha, Chief Financial Officer

Telephone: +1-905-625-2000

Facsimile: +1-905-625-2035

	 	 	 	with a copy to:

	 	 	 	Blake, Cassels & Graydon LLP

Suite 2800

199 Bay Street

Toronto, Ontario

Canada M5L 1A9

Attention: David J. Toswell

Telephone: +1-416-863-4246

 

 

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	 	 	 	Facsimile: +1-416-863-2653

	 	(b)	 	to either Lender c/o:

	 	 	 	Dassault Systèmes S.A.

9 Quai Marcel Dassault

BP 310

92156 Suresnes

Cedex, France

Attention: Martine Wallimann, Chief Legal Officer

Telephone: +33-1-40-99-44-23

Facsimile: +33-1-55-49-82-55

	 	 	 	with a copy to:

	 	 	 	Stikeman Elliott

1155 René-Lévesque Blvd. West

40th Floor

Montreal, Quebec

Canada H3B 3V2

Attention: Franziska Ruf

Telephone: +1-514-397-3670

Facsimile: +1-514-397-3222

     Any such communication shall be deemed to have been validly and
effectively given if (i) personally delivered, on the date of such delivery if
such date is a Business Day and such delivery was made prior to 4:00 p.m.
(Toronto time), otherwise on the next Business Day, (ii) transmitted by
facsimile or similar means of recorded communication on the Business Day
following the date of transmission. Any party may change its address for
service from time to time by notice given in accordance with the foregoing and
any subsequent notice shall be sent to the party at its changed address.

9.5 Confidentiality

     Each Lender shall use reasonable efforts to ensure that financial
statements or other information relating to the Borrower which may be delivered
to it pursuant to this Agreement and which are not publicly filed or otherwise
made available to the public generally (and which are not independently known
to such Lender) will be treated confidentially by such Lender and will not,
except with the consent of the Borrower, be distributed or otherwise made
available by such Lender to any Person other than its directors, officers,
employees, authorized agents, counsel or other representatives (provided the
other representatives have agreed or are under a duty to keep all information
confidential) required, in the reasonable opinion of such Lender, to have such
information. Each Lender is authorized to deliver a copy of any financial
statements or any other information which may be delivered to it pursuant to
this Agreement to (i) any

 

 

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potential or actual Assignee, as such term is defined below in Section
9.7(c) provided notice is given to the Borrower and provided that such Assignee
agrees in writing in favour of the Borrower to be bound by the confidentiality
provisions of this Agreement, (ii) any Governmental Entity having jurisdiction
over the Lender in order to comply with any applicable law; and (iii) any
Subsidiary of the Euro Lender required, in the reasonable opinion of the Euro
Lender, to have such information provided that such Subsidiary will be advised
by the Euro Lender of and will be bound by, and the Euro Lender will be
responsible for any breach by such Subsidiary of any of, the confidentiality
provisions of this Agreement..

9.6 Costs, Expenses and Indemnity

	 	(a)	 	The Borrower shall, whether or not the transaction
contemplated in this Agreement are completed, indemnify and hold the
Lenders and their respective officers, directors, employees and
agents (each an “Indemnified Person”) harmless from, and shall pay
to such Indemnified Person on demand, any amounts required to
compensate the Indemnified Person for, any claim or loss suffered
by, imposed on, or asserted against, the Indemnified Person as a
result of, connected with or arising out of (i) a default (whether
or not constituting a Default or an Event of Default) by the
Borrower, (ii) any proceedings brought against the Indemnified
Person due to its entering into of any of the Loan Documents and
performing its obligations under the Loan Documents except to the
extent caused by the gross negligence or wilful misconduct of an
Indemnified Person, and (iii) the presence at, on or under or the
discharge or likely discharge of contaminants from any of the
Subject Properties or any of the properties now or previously used
by the Borrower or any of its Subsidiaries, or the breach by or
non-compliance with any Environmental Law by any mortgagor, owner,
or lessee of such properties, except to the extent that any of the
same have been caused by an Indemnified Party.
	 
	 	(b)	 	The Borrower shall pay to the Lender on demand any amounts
required to compensate the Lender for any loss suffered or incurred
by it as a result of (i) the failure of the Borrower to give any
notice in the manner and at the times required by this Agreement, or
(ii) the failure of the Borrower to make a payment or a mandatory
repayment in the manner and at the time specified in this Agreement.
A certificate as to the amount of any loss submitted in good faith
by a Lender to the Borrower shall be prima facie evidence of the
amount of such loss, absent manifest error.
	 
	 	(c)	 	The provisions of this Section 9.6 shall survive the
termination of this Agreement and the repayment of all Maturity
Amounts. The Borrower acknowledges that neither its obligation to
indemnify nor any actual indemnification by it of the Lender or any
other Indemnified Person in respect of such Person’s losses for
legal fees and expenses shall in any way affect the confidentiality
or privilege relating to any information communicated by such Person
to its counsel.

 

 

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9.7 Successors and Assigns

	 	(a)	 	This Agreement shall become effective when executed by the
Borrower and the Lender and after that time shall be binding upon
and enure to the benefit of the Borrower and the Lender and their
respective successors and permitted assigns.
	 
	 	(b)	 	Except for Permitted Mergers, the Borrower shall not have the
right to assign its rights or obligations under this Agreement or
any interest in this Agreement without the prior consent of the
Lender, which consent may be arbitrarily withheld.
	 
	 	(c)	 	Subject to the next sentence, neither the Lender shall have
the right to assign its rights or obligations under any Loan
Document or any interest in any Loan Document without the prior
consent of the Borrower, which consent may be arbitrarily withheld,
unless such assignment is to a Subsidiary of the Euro Lender, in
which case no consent of the Borrower is required. Notwithstanding
the foregoing, at any time following the second anniversary of the
Closing Date either Lender may assign all or any part of its
interest in its Loan (but for greater certainty not in any other
right or entitlement under any Loan Document) to (each an
“Assignee”) (i) one or more Persons that is not a competitor of the
Borrower or its Subsidiaries, or (ii) a Person that is a competitor
of the Borrower or its Subsidiaries, if such Person acquires the
Euro Lender or is acquired by the Euro Lender, or any of its
Subsidiaries, pursuant to a Change of Control of such Person or the
Euro Lender, as the case may be, without any requirement for notice
to, or consent of, the Borrower or any other Person. Upon an
assignment, (i) the Borrower shall assign any and all benefit of all
Security to the Assignee and (ii) the Assignee shall have the same
rights and benefits and be subject to the same limitations under the
Loan Documents with respect to such Loan (but for greater certainty
not with respect to any other right or entitlement under any Loan
Documents) as it would have if it was the applicable Lender,
provided that no Assignee shall be entitled to receive any greater
payment, on a cumulative basis, pursuant to Section 9.6 than the
Lender which granted the assignment would have been entitled to
receive.
	 
	 	(d)	 	The Borrower shall provide such certificates,
acknowledgements and further assurances in respect of this Agreement
and the Loans as the Representative Lender may reasonably require in
connection with any assignment, pursuant to this Section 9.7.
	 
	 	(e)	 	In the case of an assignment, the applicable Lender shall
deliver to the Borrower and the Borrower shall execute an assignment
and assumption agreement pursuant to which the Assignee assumes the
obligations of the applicable Lender and agrees to be bound by all
the terms and conditions of this Agreement, all as if the Assignee
had been an original party. Upon receipt by the applicable Lender
of the assignment and assumption agreement, the assigning Lender and
the Borrower shall be released from their respective obligations
under this Agreement (to the

 

 

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	 	 	 	extent of such assignment and assumption) and shall have no
liability or obligations to each other to such extent, except in
respect of matters arising prior to the assignment.
	 
	 	(f)	 	Any assignment pursuant to this Section 9.7 will not
constitute a repayment by the Borrower to the assigning or granting
Lender of a Loan nor a new loan to the Borrower by the applicable
Lender or by the Assignee and the parties acknowledge that the
Borrower’s obligations with respect to such Loan will continue and
will not constitute new obligations.

9.8 Right of Set-off.

     Each party is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply the amount owed, due and
exigible by the other hereunder to it hereunder against any and all of its
obligations to the other party hereunder or pursuant to any other agreement
entered into between the parties or otherwise, as the case may be, irrespective
of whether or not demand shall have been made. The rights of the parties under
this Section 9.8 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which the parties may have. Each
party acknowledges that it would be inequitable and unconscionable not to allow
the non-defaulting party a right of set-off.

9.9 Postponement and Subordination Arrangements

     All Liens (“Senior Creditor Security”) from time to time securing any
indebtedness or liabilities (“Senior Liabilities”) that become outstanding
following the Closing Date under a Permitted Senior Credit Facility over any
business, property or asset of the Borrower and its Subsidiaries (other than
any Specific Collateral) (any such business, property or asset other than any
Specific Collateral being “Applicable Property”) shall have full and absolute
priority over each and every item of any Lien (such Liens, excluding the
Borrower’s Specific Security Agreements being, collectively, “Loan Agreement
Security”) over any Applicable Property securing any indebtedness or liability
(“Loan Agreement Liabilities”) owing to the Lenders under any Loan Documents
and each and every item of the Loan Agreement Security over the Applicable
Property shall rank subordinate and junior to each item of the Senior Creditor
Security over the Applicable Property in respect of an aggregate maximum
principal amount of Senior Liabilities at any time prior to the Specific
Security Delivery Date, of Cdn. $10,000,000 (or the Equivalent Amount in any
other currencies), and at any time on or after the Specific Security Delivery
Date of U.S. $22,000,000 (or the Equivalent Amount in any other currencies),
together in each such case with all interest, fees, costs and expenses from
time constituting Senior Liabilities (collectively the “Maximum Senior
Liability Amount”). All net proceeds of realization resulting from the
enforcement of any Senior Creditor Security or Loan Agreement Security against
any Applicable Property, all dividends, payments and other distributions made
with respect to the Senior Creditor Security or the Loan Agreement Security
relative to any Applicable Property under or with respect to any proceeding
relative to the Borrower or any of its Subsidiaries, and all insurance,
reimbursement, indemnity and similar proceeds with respect to any Applicable
Property, to a maximum of the Maximum Senior Liability Amount, shall be applied
first to the payment of all Senior Liabilities to a maximum of the Maximum
Senior

 

 

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Liability Amount and only after repayment in cash of the Maximum Senior
Liability Amount will any proceeds of realization from the enforcement of any
Loan Agreement Security, any dividends, payments or other distributions made
with respect to the Loan Agreement Security under or with respect to any
proceeding relative to the Borrower or any of its Subsidiaries or any
insurance, reimbursement, indemnity or similar proceeds, in any such case with
respect to any Applicable Property, be available to satisfy any Loan Agreement
Liabilities. Notwithstanding any priority to which any creditor (a “Senior
Creditor”) under a Permitted Senior Credit Facility and the Lenders may be or
become entitled for any reason whatsoever (including, without limitation, any
of the matters listed below) relative to any Applicable Property, the Senior
Creditor Security does hereby and shall have full and absolute priority over,
and shall rank as senior security to, the Loan Agreement Security with respect
to all of the Applicable Property until all of the Senior Liabilities (up to
the Maximum Senior Liability Amount) are paid and satisfied in full in cash and
all agreements or obligations on the part of the Senior Creditors pursuant to
the Permitted Senior Credit Facilities to make further financial accommodation
available to the Borrower or any of its Subsidiaries shall have been
terminated. The rights of the Senior Creditors and the priorities and
subordinations provided for in this Section shall apply irrespective of any
act, matter or thing of any kind, nature or description whatsoever including,
without limitation (i) the time or sequence of creation, granting, execution,
delivery or registration of any security document; (ii) the terms or provisions
of any Permitted Senior Credit Facility or Senior Creditor Security or any Loan
Document or Loan Agreement Security, (iii) the attachment or perfection, or the
non-perfection, of any Lien; (iv) the time or sequence of any advances of any
Senior Liability or any Loan Agreement Liability; (v) the time or sequence of
any demand, default or event of default, enforcement or crystalization under
any Permitted Senior Credit Facility or Senior Creditor Security or any Loan
Document or Loan Agreement Security; or (vi) any other factor of legal
relevance that would otherwise establish priorities. The Lenders acknowledge
and agree that the Borrower is contracting on its own behalf and as trustee for
each Senior Creditor and that each Senior Creditor shall be entitled as a third
party beneficiary to rely on and enforce all of the undertakings, agreements,
postponement and subordinations provided by the Lenders in this Section. The
Borrower shall also obtain and hold the rights and benefits of this Section in
trust for and on behalf of the Senior Creditors. The Lenders agree that they
will from time to time at the request of the Borrower or any Senior Creditor,
acting reasonably and in good faith, negotiate, execute and deliver a
subordination and postponement agreement in form and substance satisfactory to
the applicable Senior Creditors establishing to their satisfaction the priority
of the Senior Creditor Security, and all proceeds with respect thereto, to the
Loan Agreement Security as contemplated under this Section.

     For greater certainty, the provisions of this Section 9.9 shall operate
without limitation to the rights of the Lenders under the Borrower’s Specific
Security Agreements in respect of the Security of the Lenders over the Specific
Collateral.

9.10 Recapitalization, Exchanges, etc., Affecting the Common Shares

     Except as expressly provided herein, the provisions of this Agreement
shall apply to any and all Common Shares of the Borrower or any successor or
assignee of the Borrower (whether

 

 

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by merger, consolidation, sale of assets otherwise) which may be issued in
respect of, in exchange for, or in substitution for the Common Shares, by
reason of any share dividend, split, reverse split, combination,
recapitalization, reclassification, merger, consolidation, or otherwise in such
a manner as to reflect the intent and meaning of the provisions hereof.

9.11 Governing Law

     This Agreement shall be governed by and interpreted and enforced in
accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein.

9.12 Counterparts and Facsimile

     This Agreement may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same instrument. Delivery of an executed
signature page to this Agreement by any party by facsimile transmission shall
be as effective as delivery of a manually executed copy of this Agreement by
such party.

     [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

 

 

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     IN WITNESS WHEREOF the parties have executed this Loan Agreement on the
date appearing on the first page hereof.

	 	 	 	 	 
	 	 	RAND A TECHNOLOGY CORPORATION
	 	 	 	 	 
	 	 	
By:
	 	Rui Malhinha, Chief Financial Officer

	 	 	 	 	 
	 	 	 	 	 
	 	 	DASSAULT SYSTÈMES S.A., in its capacity as a Lender
	 	 	 	 	 
	 	 	
By:
	 	Thibault de Tersant

	 	 	 	 	 
	 	 	 	 	 
	 	 	DASSAULT SYSTÈMES S.A., in its capacity as the Security Agent
	 	 	 	 	 
	 	 	
By:
	 	Thibault de Tersant

	 	 	 	 	 
	 	 	 	 	 
	 	 	DASSAULT SYSTÈMES CORPORATION
	 	 	 	 	 
	 	 	
By:
	 	Thibault de Tersant

 

 

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TABLE OF CONTENTS

	 	 	 	 	 	 	 	 
	 	 	 	 	 	Page
	ARTICLE 1 INTERPRETATION

	1.1 Defined Terms
	 	 	1	 
	1.2 Gender and Number
	 	 	12	 
	1.3 Headings, etc.
	 	 	12	 
	1.4 Currency
	 	 	12	 
	1.5 Non-Business Days
	 	 	12	 
	1.6 Certain Phrases, etc.
	 	 	12	 
	1.7 Accounting Terms
	 	 	12	 
	1.8 Incorporation of Schedules
	 	 	12	 
	1.9 Conflict
	 	 	13	 
	1.10 Certificates
	 	 	13	 
	ARTICLE 2 CREDIT FACILITY

	2.1 Availability
	 	 	13	 
	2.2 Use of Proceeds
	 	 	14	 
	2.3 Mandatory Repayments
	 	 	14	 
	2.4 Change of Control
	 	 	14	 
	2.5 Payments under this Agreement
	 	 	15	 
	2.6 Prepayments
	 	 	15	 
	2.7 Application of Prepayments
	 	 	15	 
	2.8 Currency Indemnity
	 	 	16	 
	2.9 Taxes
	 	 	16	 
	ARTICLE 3 LENDERS’ CONVERSION RIGHT

 

 

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TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Page
	3.1 Rand Conversion Right
	 	 	17	 
	3.2 Limitation on Conversion Right
	 	 	18	 
	3.3 Conversion Right Exercise Procedure
	 	 	18	 
	3.4 Adjustments
	 	 	20	 
	3.5 Receipt
	 	 	20	 
	3.6 Right of First Offer
	 	 	20	 
	ARTICLE 4 INTEREST

	4.1 Interest
	 	 	21	 
	ARTICLE 5 DELIVERIES

	5.1 Deliveries on Execution of this Agreement
	 	 	21	 
	5.2 Conditions Precedent to the Advance of Each Tranche of the Loans
	 	 	23	 
	ARTICLE 6 REPRESENTATIONS AND WARRANTIES

	6.1 Representations and Warranties
	 	 	24	 
	6.2 Survival of Representations and Warranties
	 	 	30	 
	ARTICLE 7 COVENANTS OF THE BORROWER

	7.1 Affirmative Covenants
	 	 	30	 
	7.2 Negative Covenants
	 	 	33	 
	7.3 Financial Covenant
	 	 	35	 
	7.4 Security Covenants
	 	 	36	 
	7.5 Appointment of Security Agent as Agent for Security
	 	 	37	 
	ARTICLE 8 EVENTS OF DEFAULT

 

 

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TABLE OF CONTENTS

(continued)

	 	 	 	 	 	 
	 	 	 	Page
	8.1 Events of Default
	 	 	38	 
	8.2 Remedies Upon Default
	 	 	40	 
	ARTICLE 9 MISCELLANEOUS

	9.1 Amendments, etc.
	 	 	40	 
	9.2 Waiver
	 	 	41	 
	9.3 Evidence of Funded Debt
	 	 	41	 
	9.4 Notices, etc
	 	 	41	 
	9.5 Confidentiality
	 	 	42	 
	9.6 Costs, Expenses and Indemnity
	 	 	43	 
	9.7 Successors and Assigns
	 	 	44	 
	9.8 Right of Set-off
	 	 	45	 
	9.9 Postponement and Subordination Arrangements
	 	 	45	 
	9.10 Recapitalization, Exchanges, etc., Affecting the Common Shares
	 	 	46	 
	9.11 Governing Law
	 	 	47	 
	9.12 Counterparts
	 	 	47	 

 

 

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TABLE OF CONTENTS

(continued)

SCHEDULES

	 	 	 	 	 
	Schedule 3.3	 	
-
	 	Conversion Notice
	Schedule 6.1(l)	 	
-
	 	Environmental Compliance
	Schedule 6.1(r)	 	
-
	 	Corporate Structure
	Schedule 6.1(v)(i)	 	
-
	 	Jurisdictions
	Schedule 6.1(v)(ii)	 	
-
	 	Authorizations
	Schedule 6.1(v)(iii)	 	
-
	 	Intellectual Property
	Schedule 6.1(v)(iv)	 	
-
	 	Litigation
	Schedule 6.1(v)(v)	 	
-
	 	Material Agreements
	Schedule 6.1(w)	 	
-
	 	Certain Permitted Liens
	Schedule 7.1(a)	 	
-
	 	Form of Compliance Certificate
	Schedule 7.2(c)	 	
-
	 	Permitted Liens
	Schedule 7.1(p)	 	
-
	 	Loan Documents on Closing and Borrower’s Specific Security Documents

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00052-of-00352.parquet"}]]