Document:

amendno2arrngeagrmnt.htm

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    AMENDMENT
      NO. 2 TO ARRANGEMENT AGREEMENT dated July
      30, 2007,

     

    BETWEEN:

     

    AA
      ACQUISITION CORP., a corporation existing under the laws of Canada
      (hereinafter referred to as “Acquireco”),

     

    -
      and
      -

     

    ALLIANCE
      ATLANTIS COMMUNICATIONS INC., a corporation existing under the laws of
      Canada (hereinafter referred to as the
“Corporation”),

     

    WHEREAS
      Acquireco (formerly 6681859 Canada Inc.) and the Corporation are parties to
      an
      Arrangement Agreement dated January 10, 2007 as amended on February 26, 2007
      (the “Arrangement Agreement”);

     

    AND
      WHEREAS the parties wish to further amend the Arrangement Agreement in
      the manner set out in this amendment (the “Amendment No.2”) in
      accordance with Section 7.5 of the Arrangement Agreement;

     

    THIS
      AGREEMENT WITNESSES THAT, in consideration of the respective covenants
      and agreements herein contained and other good and valuable consideration (the
      receipt and sufficiency of which are hereby acknowledged), and intending to
      be
      legally bound hereby, Acquireco and the Corporation hereby agree as
      follows:

     

    
      	
              1.1

            	
              Interpretation

            

    

     

    All
      capitalized terms used in this Amendment No.2 that are not otherwise defined
      herein shall have the  meaning given to them in the Arrangement
      Agreement.

     

    
      	
              1.2

            	
              Amendments
                to the Arrangement
                Agreement

            

    

     

    
      	
               

            	
              (a)

            	
              Section
                1.1 of the Arrangement Agreement is hereby amended by deleting the
                existing definitions of "Closing Date", "Effective Time"
                and  “Outside Date” and substituting therefor the
                following:

            

    

     

    "Closing
      Date" means August 15, 2007 unless otherwise agreed in writing by
      Acquireco and the Corporation, provided that each of the conditions set forth
      in
      Article 6 shall have been satisfied or waived on or by the Closing
      Date;";

     

    "Effective
      Time" means the time of issue on the Effective Date of the certificate
      of arrangement issued by the Director under the CBCA;" and

     

    “Outside
      Date” means August 15, 2007 unless otherwise agreed in writing by
      Acquireco and the Corporation;”.

     

    
      	
               

            	
              (b)

            	
              Section
                5.2(a)(vii)(C) of the Arrangement Agreement is hereby amended by
                deleting
                the second paragraph of section 5.2(a)(vii)(C) and substituting therefor
                the following:

            

    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              “For
                purposes of this Agreement, "Marketing Period" shall mean
                the period terminating on August 15, 2007.”.

            

    

     

    

     

    
      	
               

            	
              (c)

            	
              Section
                1.1 of the Plan of Arrangement is hereby amended by deleting the
                existing
                definition of "Effective Time" and substituting therefor the
                following:

            

    

     

    "Effective
      Time" means the time of issue on the Effective Date of the certificate
      of arrangement issued by the Director under the CBCA;".

     

    
      	
              1.3

            	
              Financial
                Information

            

    

     

    Acquireco
      hereby acknowledges and agrees that no further financial statements or Offering
      Documents are required to be provided by the Corporation.  At the
      request of Acquireco, the Corporation will correct any inaccurate information
      previously provided by it.  The Corporation will provide any
      supplemental financial information (other than financial statements or Offering
      Documents) reasonably requested by Acquireco provided that the Corporation
      will
      not be required to provide any additional financial information due to "stale
      dating" of information previously provided.

     

    
      	
              1.4

            	
              Amending
                Order

            

    

     

    The
      Corporation shall use all commercially reasonable efforts to obtain an order
      of
      the Court prior to the Closing Date amending the Final Order and the Plan of
      Arrangement in a manner satisfactory to Acquireco and the Corporation, each
      acting reasonably, and reflecting the intention of this Amendment No.2 (the
      “Amending Order”).

     

    
      	
              1.5

            	
              Representations
                and Warranties of the
                Corporation

            

    

     

    The
      Corporation represents and warrants to and in favour of Acquireco as follows
      and
      acknowledges that Acquireco is relying upon such representations and warranties
      in connection with entering into this Amendment and completing the
      Arrangement:

     

    
      	
               

            	
              (a)

            	
              Authority
                and No Violation.

            

    

     

    
      	
               

            	
              (i)

            	
              The
                Corporation has the requisite corporate power and capacity to execute
                and
                deliver this Amendment No.2 and to perform its obligations
                hereunder.  The execution, delivery and performance of this
                Amendment No.2 by the Corporation has been duly authorized by its
                Board of
                Directors and no other corporate proceedings on its part are necessary
                to
                authorize the execution, delivery and performance of this Amendment
                No.2.

            

    

     

    
      	
               

            	
              (ii)

            	
              This
                Amendment No.2 has been duly executed and delivered by the Corporation
                and
                constitutes its legal, valid and binding obligation, enforceable
                against
                it in accordance with its terms, subject to bankruptcy, insolvency
                and
                other Laws affecting creditors’ rights generally and to general principles
                of equity.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (iii)

            	
              The
                execution and delivery of this Amendment No.2 by the Corporation
                does not,
                and the performance of this Amendment No.2 by the Corporation will
                not:

            

    

     

    
      	
               

            	
              A.

            	
              conflict
                with or violate the Articles of Incorporation or Bylaws or equivalent
                organizational documents of the Corporation or any of its
                subsidiaries;

            

    

     

    
      	
               

            	
              B.

            	
              assuming
                that all consents, approvals, authorizations and other actions described
                in section 3.1(d)(v) of the Arrangement Agreement have been obtained
                and
                all filings and obligations described in section 3.1(d)(v) have been
                made,
                conflict with or violate any Law applicable to the Corporation or
                any of
                its subsidiaries or by which any property or asset of the Corporation
                or
                any of its subsidiaries is bound;
                or

            

    

     

    
      	
               

            	
              C.

            	
              except
                as set forth in section 3.1(d)(iv) of the Disclosure Letter, result
                in any
                breach of, or constitute a default (or an event which, with notice
                or
                lapse of time or both, would become a default) under, or give to
                others
                any right of termination, amendment, acceleration or cancellation
                of, or
                create, give rise to or change any rights or obligations of any Person
                under, or result in the creation of a Lien on any property or asset
                of the
                Corporation or any of its subsidiaries pursuant to any note, bond,
                mortgage, indenture, contract, agreement, lease, license, permit,
                franchise or other instrument or obligation to which the Corporation
                or
                any of its Material Subsidiaries is a party or by which the Corporation
                or
                any of its Material Subsidiaries or any property or asset of the
                Corporation or any of its Material Subsidiaries is
                bound;

            

    

     

    except,
      with respect to clauses (B) and (C), for any such events or occurrences that
      could not reasonably be expected to have, individually or in the aggregate,
      a
      Material Adverse Effect.

     

    
      	
               

            	
              (iv)

            	
              Except
                for the Amending Order, no consent, approval, license, permit, order
                or
                authorization of, or registration, declaration or filing with, or
                permit
                from, any Governmental Entity is required to be obtained or made
                by or
                with respect to the Corporation or any of its subsidiaries in connection
                with the execution, delivery and performance of this Amendment
                No.2.

            

    

     

    
      	
              1.6

            	
              Representations
                and Warranties of
                Acquireco

            

    

     

    Acquireco
      represents and warrants to and in favour of the Corporation as follows and
      acknowledges that the Corporation is relying upon such representations and
      warranties in connection with entering into this Amendment No.2 and completing
      the Arrangement:

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    (a)           Authority
      and No Violation.

     

    
      	
               

            	
              (i)

            	
              It
                has the requisite power and capacity to execute, deliver and perform
                its
                obligations hereunder. The execution, delivery and performance of
                this
                Amendment No.2 by it has been duly authorized and no other proceedings
                on
                its part are necessary to authorize the execution, delivery and
                performance of this Amendment No.2.

            

    

     

    
      	
               

            	
              (ii)

            	
              This
                Amendment No.2 has been duly executed and delivered by it and constitutes
                its legal, valid and binding obligation, enforceable against it in
                accordance with its terms, subject to bankruptcy, insolvency and
                other
                similar laws affecting creditors’ rights generally and to general
                principles of equity.

            

    

     

    
      	
               

            	
              (iii)

            	
              The
                execution, delivery and performance by it of this Amendment No.2
                will
                not:

            

    

     

    
      	
               

            	
              A.

            	
              result
                in a violation or breach of, require any consent to be obtained under
                or
                give rise to any termination rights or payment obligation under any
                provision of:

            

    

     

    
      	
               

            	
              1.

            	
              its
                Articles or Bylaws (or other constating
                documents);

            

    

     

    
      	
               

            	
              2.

            	
              any
                resolution of its board of directors (or any committee thereof) or
                of its
                shareholders;

            

    

     

    
      	
               

            	
              3.

            	
              any
                applicable Laws; or

            

    

     

    
      	
               

            	
              4.

            	
              any
                material Contract to which it or its subsidiaries is a party or by
                which
                any of them is bound or their respective properties or assets are
                bound;
                or

            

    

     

    
      	
               

            	
              B.

            	
              give
                rise to any right of termination or acceleration of indebtedness,
                or cause
                any of its third party indebtedness to come due before its stated
                maturity
                or cause any available credit to cease to be available where such
                event
                would materially impair its ability to complete or materially prevent
                it
                from completing the Arrangement.

            

    

     

    
      	
               

            	
              (iv)

            	
              Except
                for the Amending Order, no consent, approval, order or authorization
                of,
                or declaration or filing with, any Governmental Entity or other Person
                is
                required to be obtained by it in connection with the execution, delivery
                or performance of this Amendment
                No.2.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              1.7

            	
              Survival

            

    

     

    For
      greater certainty, the representations and warranties of each of the Corporation
      and Acquireco contained herein shall survive the execution and delivery of
      this
      Amendment No.2 and shall terminate on the earlier of the termination of the
      Arrangement Agreement, as amended by this Amendment No.2, in accordance with
      the
      provisions thereof and the Effective Time.

     

    
      	
              1.8

            	
              Governing
                Law

            

    

     

    This
      Amendment No.2 shall be governed by and construed in accordance with the Laws
      of
      the Province of Ontario and the Laws of Canada applicable
      therein.  Each of the parties hereby irrevocably attorns and submits
      to the non-exclusive jurisdiction of the courts of the Province of Ontario
      with
      respect to any matter arising under this Amendment No.2.

     

    
      	
              1.9

            	
              Counterparts

            

    

     

    This
      Amendment No.2 may be executed in two or more counterparts, each of which shall
      be deemed to be an original but all of which together shall constitute one
      and
      the same instrument.

     

    
      	
              1.10

            	
              Continued
                Effect of Arrangement
                Agreement

            

    

     

    The
      Arrangement Agreement, as amended by this Amendment No.2, shall continue in
      full
      force and effect.

     

    

     

    REMAINDER
      OF THIS PAGE INTENTIONALLY LEFT BLANK

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, Acquireco and the Corporation have caused this
      Amendment No.2 to be executed as of the date first written above by their
      respective officers thereunto duly authorized.

     

    
      	 	 	
              AA
                ACQUISITION CORP.

            
	
              By:

            	
              "Richard
                Leipsic"

            
	 	
              Name:  Richard
                Leipsic

            
	 	
              Title:    Vice-President

            
	 	 	 	 
	 	 	
              By:

            	
              "Riva
                Richard"

            
	 	 	 	
              Name:  Riva
                Richard

            
	 	 	 	
              Title:    Secretary

            

    

     

    

     

     

    

     

    
      	 	 	
              ALLIANCE
                ATLANTIS COMMUNICATIONS INC.

            
	
              By:

            	
              "Michael
                MacMillan"

            
	 	
              Name:
                Michael MacMillan

            
	 	
              Title:  Executive
                Chairman

            
	 	 	 	 
	 	 	
              By:

            	
              "Phyllis
                Yaffe"

            
	 	 	 	
              Name:  Phyllis
                Yaffe

            
	 	 	 	
              Title:     Chief
                Executive Officer

            
	 	 	 	 

    

    
      
        
        

      

      
        6southilvotingagreement.htm

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    VOTING
      AGREEMENT

     

    THIS
      AGREEMENT is made as of the 10th
      day of January,
      2007.

     

    BETWEEN:

     

    SOUTHHILL
      STRATEGY INC., a corporation existing

     

    under
      the
      laws of the Province of Ontario (“SHS”)

     

    -and-

     

    MICHAEL
      MACMILLAN, an individual resident in the City of Toronto, Province of
      Ontario (“MacMillan”)

     

    -and-

     

    SEATON
      MCLEAN, an individual resident in the City of Toronto, Province of
      Ontario (“McLean”)

     

    (SHS,
      MacMillan and McLean each referred to as a “Shareholder” and
      collectively referred to as the “Shareholders”)

     

    -and-

     

    6681859
      CANADA INC., a corporation existing under the laws of
      Canada (the “Purchaser”)

     

    WHEREAS
      SHS is the registered and beneficial owner of
      670,995 Class A voting shares (the “AA
      Shares”) in the capital of Alliance Atlantis Communications Inc. (the
“Corporation”);

     

    AND
      WHEREAS MacMillan and McLean are the registered and beneficial owners
      respectively of 27,889 and 540,986 Class B non-voting shares (“Class B
      Shares”) in the capital of the Corporation (the “Principals’ AA
      Shares”), (the AA Shares and the Principals’ AA Shares together being,
      the “Subject Shares”);

     

    AND
      WHEREAS MacMillan and McLean are the registered and beneficial owners
      of 30,000 Class A Voting Shares and 640,995 Class B Non-Voting
      Shares  in the capital of SHS (the “SHS
      Shares”);

     

    AND
      WHEREAS MacMillan and McLean are the registered and beneficial owners
      of all of the outstanding SHS Shares;

     

    AND
      WHEREAS the Purchaser and the Corporation have entered into an
      arrangement agreement concurrently with the entering into of this Agreement
      (the
“Arrangement Agreement”);

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    ANDWHEREAS
      the Shareholders acknowledge that (i) the Purchaser would not enter into
      the Arrangement Agreement but for the execution and delivery of this Agreement
      by the Shareholders and (ii) it is a condition of the Purchaser’s obligation
      under the Arrangement
      Agreement to consummate the Arrangement that this Agreement be in effect and
      not
      be terminated;

     

    NOW
      THEREFORE this Agreement witnesses that, in consideration of the
      premises and the covenants and agreements herein contained, the parties hereto
      agree as follows:

     

     

    ARTICLE 1

     

     

    INTERPRETATION

     

    Section 1.1                                Definitions
      in Arrangement Agreement

     

    All
      terms
      used in this Agreement that are not defined herein and that are defined in
      the
      Arrangement Agreement shall have the respective meanings ascribed to them in
      the
      Arrangement Agreement.

     

    Section 1.2                                Schedules

     

    The
      following Schedule attached hereto constitutes an integral part of this
      Agreement:

     

    Schedule
      “A”                                Arrangement
      Agreement

     

    

     

     

    ARTICLE 2

     

     

    COVENANTS
      OF THE SHAREHOLDERS

     

    Section 2.1                                General

     

    The
      Shareholders hereby covenant and agree in favour of the Purchaser that, from
      the
      date hereof until the termination of this Agreement in accordance with Article 4, except as permitted by this
      Agreement:

     

    
      	
               

            	
              (a)

            	
              at
                any meeting of shareholders of the Corporation called to vote upon
                the
                Arrangement Agreement or the transactions contemplated by the Arrangement
                Agreement or at any adjournment thereof or in any other circumstances
                upon
                which a vote, consent or other approval (including by written consent
                in
                lieu of a meeting) with respect to the Arrangement Agreement or the
                transactions contemplated by the Arrangement Agreement is sought,
                each
                Shareholder shall cause its Subject Shares to be counted as present
                for
                purposes of establishing quorum and shall vote (or cause to be voted)
                its
                Subject Shares (i) in favour of the approval of the Arrangement and
                the
                Arrangement Agreement and each of the transactions contemplated by
                the
                Arrangement Agreement, and (ii) in favour of any other matter necessary
                for the consummation of the Arrangement.  In connection
                therewith, each Shareholder hereby appoints the Purchaser as attorney
                in
                fact, for so long as this Agreement remains in effect, for and on
                its
                behalf to execute a proxy appointing such person designated by the
                Purchaser to attend and act on behalf of such Shareholder at the
                meeting
                of the Corporation in respect of any of the matters referred to in
                this
                Subsection 2.1(a) and to act on behalf of such Shareholder on every
                action
                or approval by written consent of the Shareholders of the Corporation
                in
                respect of such matters, and if pursuant to this power of attorney
                the
                Purchaser has executed and not revoked a proxy in respect of such
                a
                meeting, which proxy has been accepted by the Corporation, then in
                such
                circumstances the Shareholder shall not be responsible for voting
                under
                this Subsection 2.1(a).  The Purchaser shall advise the
                Shareholder upon executing any proxies in respect of such
                Shareholder;

            

    

     

    
      	
               

            	
              (b)

            	
              at
                any meeting of shareholders of the Corporation or at any adjournment
                thereof or in any other circumstances upon which a vote, consent
                or other
                approval of all or some of the shareholders of the Corporation is
                sought
                (including by written consent in lieu of a meeting), each Shareholder
                shall cause its Subject Shares to be counted as present for purposes
                of
                establishing quorum and shall vote (or cause to be voted) its Subject
                Shares against (i) any merger agreement or merger (other than the
                Arrangement Agreement), consolidation, combination, sale or transfer
                of a
                material amount of assets, amalgamation, plan of arrangement,
                reorganization, recapitalization, dissolution, liquidation or winding
                up
                of or by the Corporation or any Acquisition Proposal (ii) any amendment
                of
                the Corporation’s articles or by-laws or other proposal or transaction
                involving the Corporation or any of its subsidiaries, which amendment
                or
                other proposal or transaction would in any manner delay, impede,
                frustrate, prevent or nullify the Arrangement Agreement or any of
                the
                transactions contemplated by the Arrangement Agreement or change
                in any
                manner the voting rights of the Subject Shares or any other shares
                of the
                Corporation (iii) any action, agreement, transaction or proposal
                that
                would reasonably be expected to result in a breach
                of any representation, warranty, covenant, agreement or other obligation
                of the Corporation in the Arrangement Agreement, in a Material Adverse
                Change or in a breach of a representation, warranty, covenant or
                agreement
                or other obligation of any Shareholder under this Agreement  and
                (iv) any action, agreement, transaction or proposal that might reasonably
                be regarded as being directed towards or likely to prevent or delay
                the
                Meeting or thesuccessful completion of the transactions contemplated
                by
                the Arrangement Agreement and this
                Agreement;

            

    

     

    
      	
               

            	
              (c)

            	
              each
                Shareholder shall not, directly or indirectly, through any officer,
                director, employee, representative or agent of SHS or the
                Corporation:

            

    

     

    
      	
               

            	
              (i)

            	
              solicit,
                assist, initiate, encourage or otherwise facilitate (including, without
                limitation, by way of furnishing non-public information, permitting
                any
                visit to any facilities or properties of the Corporation or any subsidiary
                or entering into any form of written or oral agreement, arrangement
                or
                understanding) any inquiries, proposals or offers regarding an Acquisition
                Proposal;

            

    

     

    
      	
               

            	
              (ii)

            	
              engage
                in or otherwise facilitate any discussions or negotiations regarding
                or
                provide any confidential information with respect to any Acquisition
                Proposal;

            

    

     

    
      	
               

            	
              (iii)

            	
              approve
                or recommend, or propose publicly to approve or recommend, any Acquisition
                Proposal;

            

    

     

    
      	
               

            	
              (iv)

            	
              withdraw
                support, or propose publicly to withdraw support,  from the
                transactions contemplated by the Arrangement
                Agreement;

            

    

     

    
      	
               

            	
              (v)

            	
              enter,
                or propose publicly to, enter into any agreement related to any
                Acquisition Proposal;

            

    

     

    
      	
               

            	
              (d)

            	
              the
                Shareholders will immediately cease and cause to be terminated any
                existing solicitation, discussion or negotiation with any Person
                (other
                than the Purchaser) by the Shareholders or any of the officers, directors,
                employees, representatives or agents of SHS with respect to any potential
                Acquisition Proposal, whether or not initiated by
                Shareholders  or any of the officers, directors, employees,
                representatives or agents of SHS;

            

    

     

    
      	
               

            	
              (e)

            	
              promptly
                notify the Purchaser by telephone, followed by notice in writing,
                of any
                Acquisition Proposal received by the Shareholders after the date
                hereof,
                or any request received by SHS after the date hereof for non-public
                information relating to SHS in connection with an Acquisition
                Proposal.  Such notice shall include a description of the
                material terms and conditions of any proposal received by SHS and
                provide
                such details of the proposal, enquiry or contact as the Purchaser
                may
                reasonably request, including the identity of the Person making such
                proposal, inquiry or contact;

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (f)

            	
              except
                in accordance with Section 2.2, each
                Shareholder agrees not to directly or indirectly, (i) sell, transfer,
                assign, grant a participation interest in, option, pledge, hypothecate,
                grant a security or voting interest in or otherwise convey or encumber
                (each, a “Transfer”), or enter into any agreement, option or other
                arrangement (including any profit sharing arrangement) with respect
                to the
                Transfer of, any of its Subject Shares to any Person, other than
                pursuant
                to the Arrangement Agreement (or for greater certainty pursuant to
                the
                Holdco Alternative), or (ii) grant any proxies or power of attorney,
                deposit any of its Subject Shares into any voting trust or enter
                into any
                voting arrangement, whether by proxy, voting agreement or otherwise,
                with
                respect to its Subject Shares, other than pursuant to this
                Agreement;

            

    

     

    
      	
               

            	
              (g)

            	
              each
                of MacMillan and McLean agrees not to directly or indirectly, (i)
                Transfer
                or enter into any agreement, option or other arrangement (including
                any
                profit sharing arrangement) with respect to the Transfer of any of
                his SHS
                Shares to any Person, or (ii) grant any proxies, power of attorney,
                deposit any of his SHS Shares into any voting trust or enter into
                any
                voting arrangement, whether by proxy, voting agreement or
                otherwise;

            

    

     

    
      	
               

            	
              (h)

            	
              each
                Shareholder shall not take any other action of any kind, directly
                or
                indirectly, which might reasonably be regarded as likely to reduce
                the
                success of, or delay or interfere with the completion of the transactions
                contemplated by the Arrangement Agreement;

            

    

     

    
      	
               

            	
              (i)

            	
              each
                Shareholder shall use all commercially reasonable efforts in its
                capacity
                as a holder of Subject Shares or SHS Shares, as applicable, to assist
                the
                Corporation to successfully complete the Arrangement and the other
                transactions contemplated by the Arrangement Agreement and this Agreement
                and to oppose any of the matters listed in (i) to (iv) in Section 2.1(b);

            

    

     

    
      	
               

            	
              (j)

            	
              SHS
                shall deliver a Certificate of Non-Participation (as defined in paragraph
                5 of Article F of Schedule “A” to the Articles of Amalgamation of the
                Corporation dated October 14, 2003) to the transfer agent of the
                Class A
                Voting Shares and to the Secretary of
                the Corporation prior to the end of the seventh day
                after any Exclusionary Offer (as defined in Article F of Schedule
“A” to
                the Articles of Amalgamation of the Corporation dated October 14,
                2003)
                has been made.  SHS shall not deliver a Notice of Tender (as
                defined in paragraph 5 of Article F of Schedule “A” to the Articles of
                Amalgamation of the Corporation dated October 14, 2003) to the transfer
                agent of the Class A Voting Shares or the Secretary of the Corporation
                nor
                shall SHS deliver a Notice of Transfer (as defined inArticle F of
                Schedule
                “A” to the Articles of Amalgamation of the Corporation dated October
                14,
                2003) to the transfer agent of the Class A Voting Shares or the Secretary
                of the Corporation;

            

    

     

    
      	
               

            	
              (k)

            	
              each
                Shareholder hereby waives any rights of appraisal or rights of dissent
                from the Arrangement or the transactions contemplated by the Arrangement
                Agreement that such Shareholder may
                have;

            

    

     

    
      	
               

            	
              (l)

            	
              each
                Shareholder hereby agrees to promptly notify the Purchaser and the
                other
                Shareholders of the amount of any new equity interests in the Corporation
                acquired by such Shareholder, if any, after the date
                hereof.  Any such equity interests shall be subject to the terms
                of this Agreement as though owned by such Shareholder on the date
                hereof;
                and

            

    

     

    
      	
               

            	
              (m)

            	
              each
                Shareholder shall, from time to time, execute and deliver, or cause
                to be
                executed and delivered, such additional or further consents, documents
                and
                other instruments and shall take all such other action necessary
                or as
                Purchaser or any of the other Shareholders may reasonably request
                for the
                purpose of effectively carrying out the transactions contemplated
                by this
                Agreement.

            

    

     

    Section 2.2                                Gifts
      to Charity

     

    At
      any
      time following the Meeting at which the Special Resolution is passed and prior
      to the Effective Date, each Shareholder shall have the right directly or
      indirectly to gift any portion of its Subject Shares to various charities
      provided that such charities agree to the restrictions in Section 3.5 and the
      Purchaser is satisfied, acting reasonably, that such gift will not affect the
      ability of the Shareholders to vote such AA Shares in favour of the Special
      Resolution or the ability of the Purchaser to acquire such AA Shares pursuant
      to
      the Arrangement or the ability of the Purchaser to claim a tax bump as described
      in section 5.1(h) of the Arrangement Agreement. In the event of an Alternative
      Transaction, the Shareholders shall have a period of five (5) Business Days
      prior to the expiry time for tendering their Subject Shares to, directly or
      indirectly, gift any portion of its Subject Shares to various charities provided
      that such charities agree to the restrictions in Section 3.5 and provided that
      such gifting shall not materially and adversely affect the ability to cause
      the
      Alternative Transaction.

     

    Section 2.3                                Co-operation/Alternative
      Transaction

     

    If
      the
      Purchaser concludes after the date of this Agreement that it is necessary or
      desirable to proceed with a form of transaction other than pursuant to the
      Arrangement Agreement (including, without limitation, a take-over bid) whereby
      the Purchaser and/or its affiliates would effectively acquire all the Subject
      Shares on economic terms and conditions having consequences to each Shareholder
      (in such Shareholder’s reasonable determination) that are equivalent to or
      better than those contemplated by this Agreement (any such transaction is
      referred to as an “Alternative
      Transaction”)  ,provided that the Purchaser makes available
      such Alternative Transaction to each shareholder of the Corporation on economic
      terms and conditions that are equivalent  to those provided to each
      Shareholder, each Shareholder agrees to support the completion of the
      Alternative Transaction in the same manner as the Arrangement Agreement,
      including, in the case of a take-over bid, by causing all of such Shareholder’s
      Subject Shares to be validly tendered in acceptance of such take-over bid
      together with the letter of transmittal and, if applicable, notice of guaranteed
      delivery, and any other documents required in accordance with such take-over
      bid, and will not withdraw the Shareholder’s Subject Shares from such take-over
      bid except as expressly otherwise provided in this Agreement.

     

     

    ARTICLE 3

     

     

    REPRESENTATIONS
      AND WARRANTIES

     

    Section 3.1                                Representations
      and Warranties of SHS

     

    Each
      of
      MacMillan, McLean and SHS hereby severally, and in the case of MacMillan and
      SHS, jointly and severally, represents and warrants to and covenants with the
      Purchaser as follows, and acknowledges that the Purchaser is relying upon such
      representations, warranties and covenants in entering into this Agreement and
      the Arrangement Agreement:

     

    
      	
               

            	
              (a)

            	
              Incorporation;
                Capacity.  SHS is a subsisting corporation under the
                laws of the Province of Ontario. SHS has the requisite corporate
                power and
                capacity to execute and deliver this Agreement and to perform its
                obligations hereunder.

            

    

     

    
      	
               

            	
              (b)

            	
              Authorization.  The
                execution, delivery and performance of this Agreement by SHS have
                been
                duly authorized by its board of directors and shareholders and no
                other
                internal proceedings on its part, including any approvals pursuant
                to a
                unanimous shareholders agreement (the “USA”) dated March 18, 2005 among
                Michael MacMillan, Seaton McLean and Southhill Strategy Inc., are
                necessary to authorize this Agreement or the transactions contemplated
                hereunder.

            

    

     

    
      	
               

            	
              (c)

            	
              Enforceable.  This
                Agreement has been duly executed and delivered by SHS and constitutes
                its
                legal, valid and binding obligation, enforceable against it in accordance
                with its terms, subject to bankruptcy, insolvency and other similar
                Laws
                affecting creditors’ rights generally, and to general principles of
                equity.

            

    

     

    
      	
               

            	
              (d)

            	
              Ownership
                of Shares and Other Securities by SHS. SHS is the sole registered
                and beneficial owner of the AA Shares.  SHS does not own or have
                any interest in any other shares of the Corporation.  Except as
                contemplated in the Arrangement Agreement, including pursuant to
                the
                Holdco Alternative, SHS is, and, subject to Section 2.2, will be immediately prior to
                the Effective Date, the registered and beneficial owner of the AA
                Shares,
                with good and marketable title thereto, free and clear of any and
                all
                mortgages, liens, charges, restrictions, security interests, adverse
                claims, pledges, encumbrances and demands or rights of others of
                any
                nature or kind whatsoever, other than (i) the pledge by SHS of 653,750
                Class A voting shares (“Class A Shares”) in the capital of the Corporation
                in favour of the Royal Bank of Canada (“RBC”) to secure its obligations to
                RBC under a limited recourse guarantee dated March 18, 2005 relating
                to
                loan obligations of MacMillan to RBC; and (ii) the pledge by SHS
                of 14,427
                Class A Shares in favour of RBC to secure its obligations to RBC
                under a
                limited recourse guarantee dated March 18, 2005 relating to loan
                obligations of McLean to RBC.

            

    

     

    
      	
               

            	
              (e)

            	
              No
                Breach.  Neither the execution and delivery of this
                Agreement by the Shareholders, the consummation by the Shareholders
                of the
                transactions contemplated hereby nor the compliance by the Shareholders
                with any of the provisions hereof
                will:

            

    

     

    
      	
               

            	
              (i)

            	
              result
                in any breach of, or constitute a default (or an event which with
                notice
                or lapse of time or both would become a default) (or give rise to
                any
                third party right of termination, cancellation, material modification,
                acceleration, purchase or right of first refusal) under any provision
                of
                the certificate of incorporation, articles or by-laws of SHS, or
                under any
                of the terms, conditions or provisions of any note, loan agreement,
                bond,
                mortgage, indenture, contract, license, agreement, lease, permit
                or other
                instrument or obligation to which any Shareholder is a party or by
                which
                any Shareholder or any of its properties or assets (including the
                Subject
                Shares) may be bound, except that the consent of RBC is required
                for any
                sale, exchange, transfer or other disposition of the shares in the
                capital
                of the Corporation that have been pledged to RBC by the Shareholders
                as
                security for their respective obligations, to
                RBC,

            

    

     

    
      	
               

            	
              (ii)

            	
              require
                on the part of the Shareholder any filing with (other than pursuant
                to the
                requirements of applicable securities legislation (which filings
                the
                Shareholder will undertake)) or permit, authorization, consent or
                approval
                of, any Governmental Entity or any other Person,
                or

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (iii)

            	
              subject
                to compliance with any approval or Laws contemplated by the Arrangement
                Agreement, violate or conflict with any judgement, order, notice,
                decree,
                statute, law, ordinance, rule or regulation applicable to the Shareholder
                or any of its properties or assets.

            

    

     

    
      	
               

            	
              (f)

            	
              No
                Proceedings. There is no private or governmental action, suit,
                proceeding, claim, arbitration or investigation pending before any
                Governmental Entity, or, to the knowledge of the Shareholder, threatened
                against the Shareholder or any of its properties that, individually
                or in
                the aggregate, could reasonably be expected to have an adverse effect
                on
                the Shareholder’s ability to consummate the transactions contemplated by
                this Agreement.  There is no order of any Governmental Authority
                against the Shareholder that could prevent, enjoin, alter or materially
                delay any of the transactions contemplated by this Agreement, or
                that
                could reasonably be expected to have an adverse effect on the
                Shareholder’s ability to consummate the transactions contemplated by this
                Agreement.

            

    

     

    
      	
               

            	
              (g)

            	
              No
                Agreements. No Person has any agreement or option, or any right
                or privilege (whether by law, pre-emptive or contractual) capable
                of
                becoming an agreement or option, for the purchase, acquisition or
                transfer
                of any of the AA Shares, or any interest therein or right thereto,
                except
                pursuant to this Agreement.

            

    

     

    
      	
               

            	
              (h)

            	
              Voting.  The
                Shareholders have the sole and exclusive right to enter into this
                Agreement and to vote the Subject Shares as contemplated herein and
                each
                of MacMillan and McLean has the sole and exclusive right to vote
                the SHS
                Shares that are owned by him.  None of the Subject Shares is
                subject to any proxy, power of attorney, attorney-in-fact, voting
                trust,
                vote pooling or other agreement with respect to the right to vote,
                call
                meetings of shareholders or give consents or approvals of any kind,
                other
                than as provided in a unanimous shareholders agreement dated March
                18,
                2005 among Michael MacMillan, Seaton McLean and Southhill Strategy
                Inc.

            

    

     

    
      	
               

            	
              (i)

            	
              Consents.
                No consent, approval, order or authorization of, or declaration or
                filing
                with, any Governmental Entity or other Person is required to be obtained
                by SHS, MacMillan or McLean in connection with the execution, delivery
                or
                performance of this Agreement, other than the consent of RBC that
                is
                required for the sale, exchange, transfer or other disposition of
                the
                shares in the capital of the Corporation that have been pledged to
                RBC by
                the Shareholders as security for their respective obligations to
                RBC.
                Furthermore, it is specifically acknowledged and agreed by the Purchaser
                that the Purchaser is responsible for any consents required with
                respect
                to CRTC Approval whether pursuant to the Arrangement Agreement or
                this
                Agreement.

            

    

     

    
      	
               

            	
              (j)

            	
              Legal
                Proceedings. There are no legal proceedings in progress or
                pending before any Governmental Entity or threatened against SHS,
                MacMillan or McLean or any judgment, decree or order against SHS,
                MacMillan or McLean that would adversely affect in any manner the
                ability
                of any such party to enter into this Agreement and to perform its
                obligations hereunder or the title of SHS to any of the AA Shares
                or the
                title of MacMillan or McLean, as applicable, to any of the Principals’ AA
                Shares or the SHS Shares.

            

    

     

    
      	
               

            	
              (k)

            	
              Investments.  SHS
                has not, since June 30, 2006, acquired directly or
                indirectly any debt or shares in the capital of a Prohibited Issuer
                (as
                defined in Section 3.5(2)) if existing on the date
                hereof.

            

    

     

    Section 3.2                                Representations
      and Warranties of MacMillan

     

    MacMillan
      hereby represents and warrants to and covenants with the Purchaser as follows,
      and acknowledges that the Purchaser is relying upon such representations,
      warranties and covenants in entering into this Agreement:

     

    
      	
               

            	
              (a)

            	
              Binding.  This
                Agreement has been duly executed and delivered by MacMillan and
                constitutes his legal, valid and binding obligation enforceable against
                him in accordance with its terms, subject to bankruptcy, insolvency
                and
                other similar Laws affecting creditors’ rights generally, and to general
                principles of equity.

            

    

     

    
      	
               

            	
              (b)

            	
              Ownership
                of Shares, SHS Shares and Other Securities by MacMillan.
                MacMillan is the sole registered and beneficial owner of
                27, 889
                Class B  Shares and 15,000 Voting Shares and 640,995 Non-Voting
                Shares in the capital of SHS (collectively, the “MacMillan
                Shares”).   MacMillan does not own or have any
                interest in any other shares of the Corporation or SHS, except for
                options
                that he holds to acquire 176,000 Class B Shares.  Except as
                contemplated in the Arrangement Agreement, including pursuant to
                the
                Holdco Alternative, MacMillan  is, and will be immediately prior
                to the Effective Date, the registered and beneficial owner of the
                MacMillan Shares, with good and marketable title thereto, free and
                clear
                of any and all mortgages, liens, charges, restrictions, security
                interests, adverse claims, pledges, encumbrances and demands or rights
                of
                others of any nature or kind whatsoever.

            

    

     

    
      	
               

            	
              (c)

            	
              No
                Agreements. No Person has any agreement or option, or any right
                or privilege (whether by law, pre-emptive or contractual) capable
                ofbecoming an agreement or option, for the purchase, acquisition
                or
                transfer of any of the MacMillan Shares, or any interest therein
                or right
                thereto, except pursuant to this
                Agreement.

            

    

     

    
      	
               

            	
              (d)

            	
              Voting.
                None of the MacMillan Shares is subject to any proxy, voting trust,
                vote
                pooling or other agreement with respect to the right to vote, call
                meetings of shareholders or give consents or approvals of any
                kind.

            

    

     

    
      	
               

            	
              (e)

            	
              Investments.  MacMillan
                has not, since June 30, 2006, acquired directly or indirectly any
                debt or
                shares in the capital of a Prohibited Issuer (as defined in Section
                3.5(2)) if existing on the date
                hereof.

            

    

     

    Section 3.3                                Representations
      and Warranties of McLean

     

    McLean
      hereby represents and warrants to and covenants with the Purchaser as follows,
      and acknowledges that the Purchaser is relying upon such representations,
      warranties and covenants in entering into this Agreement:

     

    
      	
               

            	
              (a)

            	
              Binding.  This
                Agreement has been duly executed and delivered by McLean and constitutes
                his legal, valid and binding obligation enforceable against him in
                accordance with its terms, subject to bankruptcy, insolvency and
                other
                similar Laws affecting creditors’ rights generally, and to general
                principles of equity.

            

    

     

    
      	
               

            	
              (b)

            	
              Ownership
                of Shares, SHS Shares and Other Securities by McLean. McLean is
                the sole registered and beneficial owner of 540,986 Class B Shares
                and
                15,000 Voting Shares in the capital of SHS (collectively, the
                “McLean Shares”).   McLean does not own or
                have any interest in any other shares of the Corporation or
                SHS.  Except as contemplated in the Arrangement Agreement,
                including pursuant to the Holdco Alternative, McLean is, and will
                be
                immediately prior to the Effective Date, the registered and beneficial
                owner of the McLean Shares, with good and marketable title thereto,
                free
                and clear of any and all mortgages, liens, charges, restrictions,
                security
                interests, adverse claims, pledges, encumbrances and demands or rights
                of
                others of any nature or kind whatsoever, other than (i) as provided
                in a
                unanimous shareholders agreement dated March 18, 2005 among Michael
                MacMillan, Seaton McLean and Southhill Strategy Inc. and (ii) in
                respect
                of the pledge by him of 539, 323 Class B Shares to
                RBC.

            

    

     

    
      	
               

            	
              (c)

            	
              No
                Agreements. No Person has any agreement or option, or any right
                or privilege (whether by law, pre-emptive or contractual) capable
                of
                becoming an agreement or option, for the purchase, acquisition or
                transfer
                of any of the McLean Shares, or any interest therein or right thereto,
                except pursuant to this Agreement, other than as provided in a unanimous
                shareholders agreement dated March 18, 2005 among Michael MacMillan,
                Seaton McLean and Southhill Strategy
                Inc.

            

    

     

    
      	
               

            	
              (d)

            	
              Voting.
                None of the McLean Shares is subject to any proxy, voting trust,
                vote
                pooling or other agreement with respect to the right to vote, call
                meetings of shareholders or give consents or approvals of any kind,
                other
                than as provided in a unanimous shareholders agreement dated March
                18,
                2005 among Michael MacMillan, Seaton McLean and Southhill Strategy
                Inc.

            

    

     

    
      	
               

            	
              (e)

            	
              Investments.  McLean
                has not, since June 30, 2006, acquired directly or indirectly any
                debt or
                shares in the capital of a Prohibited Issuer (as defined in Section
                3.5(2)) if existing on the date
                hereof.

            

    

     

    Section 3.4                                Representations
      and Warranties of the Purchaser

     

    The
      Purchaser hereby represents and warrants to the Shareholders as follows, and
      acknowledges that each Shareholder is relying upon such
      representations,  and warranties in entering into this Agreement
      that:

     

    
      	
               

            	
              (a)

            	
              Capacity.  It
                has the requisite corporate power and capacity to execute and deliver
                this
                Agreement and to perform its obligations
                hereunder.

            

    

     

    
      	
               

            	
              (b)

            	
              Authorization.  The
                execution, delivery and performance of this Agreement by it have
                been duly
                authorized by its board of directors or similar authority and no
                other
                internal proceedings on its part are necessary to authorize this
                Agreement
                or the transactions contemplated
                hereunder.

            

    

     

    
      	
               

            	
              (c)

            	
              Enforceable.  This
                Agreement has been duly executed and delivered by it and constitutes
                its
                legal, valid and binding obligation, enforceable against it in accordance
                with its terms, subject to bankruptcy, insolvency and other similar
                Laws
                affecting creditors’ rights generally, and to general principles of
                equity.

            

    

     

    
      	
               

            	
              (d)

            	
              No
                Breach.  The execution, delivery and performance by it
                of this Agreement will not:

            

    

     

    
      	
               

            	
              (i)

            	
              result
                in a violation or breach of, require any consent to be obtained under
                or
                give rise to any termination rights or payment obligation under any
                provision of:

            

    

     

    
      	
               

            	
              (A)

            	
              its
                articles or by-laws (or other constating
                documents);

            

    

     

    
      	
               

            	
              (B)

            	
              any
                resolution of its board of directors (or any committee thereof) or
                of its
                shareholders;

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (C)

            	
              subject
                to obtaining the Regulatory Approvals relating to the Purchaser,
                any
                applicable Laws; or

            

    

     

    
      	
               

            	
              (D)

            	
              any
                material Contract to which it or its subsidiaries is a party or by
                which
                any of them is bound or their respective properties or assets are
                bound.

            

    

     

    
      	
               

            	
              (ii)

            	
              (E)

            	
              give
                rise to any right of termination or acceleration of indebtedness,
                or cause
                any third party indebtedness to come due before its stated maturity
                or
                cause any available credit to cease to be
                available.

            

    

     

    
      	
               

            	
              (e)

            	
              Consents.  No
                consent, approval, order or authorization of, or declaration or filing
                with, any Governmental Entity or other Person is required to be obtained
                by it in connection with the execution, delivery or performance of
                this
                Agreement other than the Regulatory Approvals relating to
                it.

            

    

     

    
      	
               

            	
              (f)

            	
              Legal
                Proceedings. There are no legal proceedings in progress or
                pending before any Governmental Entity or threatened against it or
                any
                judgment, decree or order against it that would adversely affect
                in any
                manner its ability to enter into this Agreement and to perform its
                obligations hereunder.

            

    

     

    Section 3.5                                Prohibited
      Securities

     

    
      	
              (1)

            	
              Each
                Shareholder hereby declares that it has no current intention
                to:

            

    

     

    
      	
               

            	
              (a)

            	
              acquire;
                or

            

    

     

    
      	
               

            	
              (b)

            	
              cause
                a person, including a trust or partnership, over which it has influence,
                to acquire,

            

    

     

    either
      directly or indirectly, any shares, warrants, debt instruments or other
      securities of any Prohibited Issuer (the aforesaid securities are hereinafter
      referred to as “Prohibited Securities”) with the exception of any Prohibited
      Securities that such Shareholder may acquire, directly or indirectly by reason
      of Prohibited Securities being acquired by (i) a mutual fund (or like investment
      vehicle) over which such Shareholder does not have any influence and in which
      such Shareholder owns (directly or indirectly) an interest, or by (ii) an
      independent investment manager who acquires the Prohibited Securities, by reason
      of its own independent decision and without any consultation with such
      Shareholder.

     

    
      	
              (2)

            	
              As
                evidence of each Shareholder’s current intention not to acquire any
                Prohibited Securities, each Shareholder hereby undertakes that it
                will not
                under any circumstances prior to the Effective Time or within the
                twelve
                (12) month period following the Effective
                Time:

            

    

     

    
      	
               

            	
              (a)

            	
              acquire
                any Prohibited Securities (except for those described in (i) or (ii)
                above); or

            

    

     

    
      	
               

            	
              (b)

            	
              cause
                any person (including a trust or partnership) over which such Shareholder
                has influence to acquire Prohibited
                Securities.

            

    

     

    For
      the
      purposes of this  Section 3.5 a “Prohibited Issuer” means the
      Purchaser, CanWest Media Works Inc., The Goldman Sachs Group, Inc., GS Capital
      Partners Fund VI, L.P., GS Capital Partners VI Offshore L.P., GS Capital
      Partners Gmbh & Co., GS Credit Partners L.P., CanWest Global
      Communications Corp., Movie Distribution Income Fund and any company established
      to, directly or indirectly, acquire the movie distribution business, the
      television program production and distribution business or the specialty
      television business currently carried on by the Corporation.

     

    
      	
              (3)

            	
              In
                addition, where the Purchaser provides notice to a Shareholder either
                prior to the Effective Time or within the twelve (12) month period
                following the Effective Time that a particular issuer (“Particular
                Issuer”) will, directly or indirectly, acquire an asset the value of which
                is wholly or partly attributable to properties that were owned, directly
                or indirectly, by the Corporation or any of its subsidiaries,
                each  Shareholder hereby undertakes that it will not under any
                circumstances within the twelve (12) month period following the Effective
                Time:

            

    

     

    
      	
               

            	
              (a)

            	
              acquire
                any shares, warrants, debt instruments or other securities of the
                Particular Issuer (except with the exception of any such securities
                that
                the Shareholder may acquire, directly or indirectly by reason of
                such
                securities being acquired by (a) a mutual fund (or like investment
                vehicle) over which the Shareholder does not have any influence and
                in
                which the Shareholder owns (directly or indirectly) an interest,
                or by (b)
                an independent investment manager who acquires such securities, by
                reason
                of its own independent decision and without any consultation with
                the
                Shareholder); or

            

    

     

    
      	
               

            	
              (b)

            	
              cause
                any person (including a trust or partnership) over which the Shareholder
                has influence to acquire such
                securities.

            

    

     

     

    ARTICLE 4

     

     

    TERMINATION

     

    Section 4.1                                Automatic
      Termination

     

    This
      Agreement shall automatically terminate upon (i) termination of the Arrangement
      Agreement where the Purchaser is not proceeding with an Alternative Transaction
      supported by the Corporation or (ii) the Corporation and the Purchaser amending
      the Arrangement Agreement in a manner that results in a reduction of the
      purchase price payable per Subject Share.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    Section 4.2                                Agreement
      to Terminate

     

    This
      Agreement may be terminated by a written instrument executed by each of the
      Purchaser and the Shareholders.

     

    Section 4.3                                Effect
      of Termination

     

    If
      this
      Agreement is terminated in accordance with this Article 4, the provisions of this Agreement will
      become void and no party shall have liability to any other party, except in
      respect of a breach of this Agreement which occurred prior to such termination
      and each Shareholder shall be entitled to withdraw any form of proxy in respect
      of the Special Resolution and withdraw any certificate of Non-Participation
      which it may have given or, if applicable, to withdraw any deposited Subject
      Shares to any take-over bid.

     

     

    ARTICLE 5

     

     

    GENERAL

     

    Section 5.1                                Further
      Assurances

     

    
      	
              (1)

            	
              Each
                of the Shareholders and the Purchaser will, from time to time, execute
                and
                deliver all such further documents and instruments and do all such
                acts
                and things as the other party may reasonably require and at the requesting
                party’s cost to effectively carry out or better evidence or perfect the
                full intent and meaning of this
                Agreement.

            

    

     

    Section 5.2                                Disclosure

     

    Except
      as
      required by applicable laws or regulations or by any Governmental Entity or
      in
      accordance with the requirements of any stock exchange, no party shall make
      any
      public announcement or statement with respect to this Agreement without the
      approval of the other, which shall not be unreasonably withheld or
      delayed.  Moreover, the parties agree to consult with each other prior
      to issuing each public announcement or statement with respect to this Agreement,
      subject to the overriding obligations of applicable Laws.  The
      Shareholders consent to the details of this Agreement being described in any
      information circular prepared by the Corporation in connection with the
      Arrangement and in any take-over bid circular prepared by the Purchaser with
      respect to any offer to acquire Class A voting shares or Class B non-voting
      shares of the Corporation and in any material change report prepared
      by  Guarantor in connection with the execution and delivery of this
      Agreement and the Arrangement Agreement.

     

    Section 5.3                                Fiduciary
      Obligations.

     

    The
      Purchaser agrees and acknowledges that the Shareholders are bound hereunder
      solely in their capacity as a shareholder of the Corporation or of SHS, as
      applicable, and that the provisions hereof shall not be deemed or interpreted
      to
      bind any Shareholder or any director, officer or shareholder of SHS in his
      capacity as a director of the Corporation or SHS.  For the avoidance
      of doubt, nothing in this Agreement shall limit any person from fulfilling
      his
      fiduciary duties as a director or officer of the Corporation or
      SHS.

     

    Section 5.4                                Time

     

    Time
      shall be of the essence of this Agreement.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    Section 5.5                                Governing
      Law

     

    This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      Province of Ontario and of Canada applicable therein (without regard to conflict
      of laws principles).

     

    Section 5.6                                Entire
      Agreement

     

    This
      Agreement, including the schedules hereto and the provisions of the Arrangement
      Agreement incorporated herein by reference, constitutes the entire agreement
      and
      understanding between and among the parties hereto with respect to the subject
      matter hereof and supersedes any prior agreement, representation or
      understanding with respect thereto.

     

    Section 5.7                                Amendments

     

    This
      Agreement may not be modified, amended, altered or supplemented, except upon
      the
      execution and delivery of a written agreement executed by all of the parties
      hereto.

     

    Section 5.8                                Severability

     

    If
      any term or other provision of this
      Agreement is invalid, illegal or incapable of being enforced by any rule of
      law
      or public policy, all other conditions and provisions of this Agreement shall
      nevertheless remain in full force and effect.  Upon such determination
      that any term or other provision is invalid, illegal or incapable of being
      enforced, the parties hereto shall negotiate in good faith to modify this
      Agreement so as to effect the original intent of the parties as closely as
      possible in a mutually acceptable manner in order that the terms of this
      Agreement remain as originally contemplated to the fullest extent
      possible.

     

    Section 5.9                                Assignment

     

    The
      provisions of this Agreement shall be binding upon and enure to the benefit
      of
      the parties hereto and their respective successors and permitted assigns,
      provided that no party may assign, delegate or otherwise transfer any of its
      rights, interests or obligations under this Agreement without the prior written
      consent of the other parties hereto, except that the Purchaser
      may  assign, delegate or otherwise transfer any of its rights,
      interests or obligations under this Agreement to an affiliate, without reducing
      its own obligations hereunder.

     

    Section 5.10                                Survival

     

    The
      representations and warranties in Section 3.1(k), Section 3.2(e) and Section 3.3(e)
      and the covenants in Section 3.5 contained in this Agreement on the
      part of each of the parties shall survive the Effective Date, the execution
      and
      delivery under this Agreement of any share or security transfer instruments
      or
      other documents of title to any of the Subject Shares and the payment of the
      consideration for the Subject Shares pursuant to the terms of the
      Arrangement.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    Section 5.11                                Notices

     

    Any
      notice, request, consent, agreement or approval which may or is required to
      be
      given pursuant to this Agreement shall be in writing and shall be sufficiently
      given or made if delivered, or sent by telecopier, in the case of:

     

    
      	
               

            	
              (a)

            	
              the
                Purchaser, addressed as follows:

            

    

     

    31st
      Floor, 201 Portage Avenue

     

    CanWest
      Global Place

     

    Winnipeg,
      MB R3B 3L7

     

    Attention:                           Richard
      M. Leipsic

     

    Fax
      No.:                           204.947.9841

     

    with
      a
      copy (which shall not constitute notice) to:

     

    Osler
      Hoskin & Harcourt LLP

     

    Box
      50,
      One First Canadian Place

     

    Toronto,
      ON M5X 1B8

     

    Attention:                           Linda
      Robinson

     

    Fax
      No.:                           416.862.6666

     

    

     

    -
      and
      -

     

    

     

    McCarthy
      Tetrault LLP

     

    Suite
      4700, Toronto Dominion Bank Tower

     

    Toronto,
      ON M5K 1E6

     

    

     

    Attention:                           Garth
      M. Girvan

     

    Fax
      No.:                           416-868-0673

     

    -
      and

     

    Wachtell,
      Lipton, Rosen & Katz

    51
      West
      52nd
      Street

    New
      York,
      New York 10019

    

     

    Attention:                           Daniel
      A. Neff

     

    Fax
      No.:                           212-403-2000

     

    

     

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              (b)

            	
              the
                Shareholders, addressed as follows:

            

    

     

    c/o
      Southhill Strategy Inc.

    34
      Warren
      Road

    Toronto Ontario

    M4V
      2R5

    

    

    Attention:                           Michael
      MacMillan

    Fax
      No.:                           416-967-7298

    and
      a
      copy (which shall not constitute notice) to:

     

    Stikeman
      Elliott LLP

     

    5300
      Commerce Court West

     

    199
      Bay
      Street

     

    Toronto,
      Ontario  M5L 1B9

     

    

     

    Attention:                           Edward
      Waitzer

     

    Fax
      No.:                           (416)
      947-0866

     

    or
      to
      such other address as the relevant person may from time to time advise by notice
      in writing given pursuant to this Section.  The date of receipt of any
      such notice, request, consent, agreement or approval shall be deemed to be
      the
      date of delivery or sending thereof if sent or delivered during normal business
      hours on a Business Day at the place of receipt and, otherwise, on the next
      following Business Day.

     

    Section 5.12                                Specific
      Performance and other Equitable Rights

     

    It
      is
      recognized and acknowledged that a breach by any party of any material
      obligations contained in this Agreement will cause the other party to sustain
      injury for which it would not have an adequate remedy at law for money damages.
      Accordingly, in the event of any such breach, any aggrieved party shall be
      entitled to the remedy of specific performance of such obligations and
      interlocutory, preliminary and permanent injunctive and other equitable relief
      in addition to any other remedy to which it may be entitled, at law or in
      equity.

     

    Section 5.13                                Expenses

     

    Each
      of
      the parties shall pay its respective legal, financial advisory and accounting
      costs and expenses incurred in connection with the preparation, execution and
      delivery of this Agreement and all documents and instruments executed or
      prepared pursuant hereto and any other costs and expenses whatsoever and
      howsoever incurred.

     

    Section 5.14                                Counterparts

     

    This
      Agreement may be executed in one or more counterparts which together shall
      be
      deemed to constitute one valid and binding agreement, and delivery of the
      counterparts may be effected by means of telecopier transmission.

     

    [end
      of page]

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF the parties have executed this Agreement as of the date
      first written above.

     

    
      	
              SOUTHHILL
                STRATEGY INC.

            	 	
              6681859
                CANADA INC.

            
	
               

              By:

            	
               

              Michael
                MacMillan

            	 	
               

              By:

            	
               

              Richard
                Leipsic

            
	 	
              Signature

            	 	 	
              Signature

            
	 	
              Name:
                Michael MacMillan

            	 	 	
              Name:
                Richard Leipsic

            
	 	
              Title:

            	 	 	
              Title:
                Director

            
	
               

              By:

            	 	 	
               

              By:

            	
               

              Steven
                Mayer

            
	 	
              Signature

            	 	 	
              Signature

            
	 	
              Name:

            	 	 	
              Name:
                Steven Mayer

            
	 	
              Title:

            	 	 	
              Title:
                Director

            

    

    

     

    
      	 	 	
              Michael
                MacMillan

            
	
              Witness

            	 	
              Michael
                MacMillan

            

    

    

     

    
      	 	 	
              Seaton
                McLean

            
	
              Witness

            	 	
              Seaton
                McLean

            

    

    

     

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    SCHEDULE
      “A”

     

    ARRANGEMENT
      AGREEMENT

     

    

     

    
      
        
        

      

      
        11

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