Postmedia Network Canada Corp
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POSTMEDIA NETWORK CANADA CORP. ANNUAL INFORMATION FORM November 27, 2013 TABLE OF CONTENTS GLOSSARY OF TERMS .............................................................................................................................. 1 CERTAIN REFERENCES, FORWARD-LOOKING STATEMENTS AND INDUSTRY INFORMATION ..... 4 CORPORATE STRUCTURE ........................................................................................................................ 7 Name, Address and Incorporation ................................................................................................... 7 Intercorporate Relationships ............................................................................................................ 7 GENERAL DEVELOPMENT OF THE BUSINESS ...................................................................................... 7 History of the Corporation ................................................................................................................ 7 OVERVIEW OF THE BUSINESS ................................................................................................................. 9 General............................................................................................................................................. 9 Newspaper Operations .................................................................................................................. 10 Digital Media and Online Operations ............................................................................................. 11 Operations ...................................................................................................................................... 13 Production and Services ................................................................................................................ 15 Competitive Conditions .................................................................................................................. 17 Components ................................................................................................................................... 18 Intangible Properties ...................................................................................................................... 18 Cycles............................................................................................................................................. 19 Environmental Protection ............................................................................................................... 19 Employees ..................................................................................................................................... 20 Regulation ...................................................................................................................................... 20 RISK FACTORS ......................................................................................................................................... 21 DIVIDENDS ................................................................................................................................................. 21 DESCRIPTION OF CAPITAL STRUCTURE .............................................................................................. 21 General........................................................................................................................................... 21 Rights upon Liquidation, Dissolution or Winding-Up ...................................................................... 21 Voting Shares ................................................................................................................................. 21 Variable Voting Shares .................................................................................................................. 22 Coattail Provision ........................................................................................................................... 23 Declaration as to Canadian Status ................................................................................................ 23 SHAREHOLDER RIGHTS PLAN ............................................................................................................... 23 INDEBTEDNESS ........................................................................................................................................ 30 MARKET FOR SECURITIES...................................................................................................................... 31 Trading Price and Volume ............................................................................................................. 31 DIRECTORS AND OFFICERS ................................................................................................................... 33 Name, Occupation and Security Holding ....................................................................................... 33 Biographies .................................................................................................................................... 34 Cease Trade Orders or Bankruptcies ............................................................................................ 36 Penalties or Sanctions ................................................................................................................... 38 Conflicts of Interest ........................................................................................................................ 38 Share Ownership Guidelines ......................................................................................................... 38 LEGAL PROCEEDINGS AND REGULATORY ACTIONS ........................................................................ 38 Legal Proceedings ......................................................................................................................... 38 (i) INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS .................................. 38 TRANSFER AGENT AND REGISTRAR .................................................................................................... 39 MATERIAL CONTRACTS .......................................................................................................................... 40 INTERESTS OF EXPERTS ........................................................................................................................ 40 AUDIT COMMITTEE INFORMATION ........................................................................................................ 40 ADDITIONAL INFORMATION.................................................................................................................... 42 SCHEDULE “A” CHARTER OF THE AUDIT COMMITTEE (ii) - 1 - GLOSSARY OF TERMS In this Annual Information Form, the following terms will have the meanings set forth below, unless otherwise indicated. Words importing the singular include the plural and vice versa and words importing any gender include all genders. “ABL Collateral” means the accounts receivable, cash and cash equivalents, inventory and related assets of Postmedia Network Inc. and the guarantors, which constitute collateral for the ABL Facility on a first-priority basis, for the First-Lien Notes on a second-priority basis and for the Second-Lien Notes on a third-priority basis. “ABL Credit Agreement” has the meaning ascribed to such term under “Indebtedness – ABL Facility”. “ABL Facility” has the meaning ascribed to such term under “Indebtedness – ABL Facility”. “Acquisition” has the meaning ascribed to such term under “General Development of the Business – History of the Corporation”. “Acquisition Consideration” has the meaning ascribed to such term under “General Development of the Business – History of the Corporation”. “Ad Hoc Committee” means the ad hoc committee of senior subordinated noteholders and lenders of Canwest LP. “Annual Information Form” means this annual information form. “Asset Purchase Agreement” means an asset purchase agreement dated May 10, 2010 that was entered into in connection with the implementation of the Plan under the CCAA relating to the LP Entities, whereby Postmedia Network Inc. purchased substantially all of the assets, including the shares of National Post Inc., and assumed certain liabilities of Canwest LP for $1.05 billion. “Board” or “Board of Directors” means the board of directors of Postmedia Network Canada Corp. “Borrowing Base” refers to a provision contained in the credit agreement governing the ABL Facility limiting Postmedia Network Inc.’s availability under the ABL Facility to the lesser of a borrowing base and $60 million, less an excess availability amount of $15.0 million. This results in a maximum availability under the ABL Facility which is no greater than $45 million. “Business Day” means a day on which banks are open for business in Toronto, but does not include a Saturday, Sunday or a holiday in the Province of Ontario. “CBCA” means the Canada Business Corporations Act. “CBI” means Canwest Books Inc., a corporation incorporated under the laws of Canada and a wholly- owned subsidiary of CPI. “CCAA” means the Companies’ Creditors Arrangement Act (Canada). “CCI” means Canwest (Canada) Inc., a corporation incorporated under the laws of Canada and a wholly- owned subsidiary of 4501071 Canada Inc. “CPI” means Canwest Publishing Inc./Publications Canwest Inc., a corporation incorporated under the laws of Canada and a wholly-owned subsidiary of CCI. “Canwest Global” means Canwest