C E RTI F I CAT Ceci certifie que les presents statuts entrent en vigueur le

Transcription

1 For Ministry Use Only A I'usage exclusif du ministere jv. Tjf Ministry of Government Services Ontario CERTI FICATE This is to certify that these articles are effective on Ministers des Services gouvernementaux C E RTI F I CAT Ceci certifie que les presents statuts entrent en vigueur le Ontario Corporation Number Numero de la society en Ontario DECEMBER.2 8peCEMBRE,.^Q12. Director / Directric Business Corporations Act / Loi sur les societes par actions Form 3 Business Corporations Act Formule 3 Loi sur les societes par actions ARTICLES OF AMENDMENT STATUTS DE MODIFICATION 1. The name of the corporation is: (Set out in BLOCK CAPITAL LETTERS) Denomination sociaie actuelle de la societe (bcrire en LETTRES MAJUSCULES SEULEMENT): F R E S H I I I N C 2. The name of the corporation is changed to (if applicable): (Set out in BLOCK CAPITAL LETTERS) Nouvelle denomination sociaie de la socibtb (s'il y a lieu) (bcrire en LETTRES MAJUSCULES SEULEMENT): Date of incorporation/amalgamation: Date de la constitution ou de la fusion : 2007/07/19 (Year, Month, Day) (annee, mois, jour) Complete only if there is a change in the number of directors or the minimum I maximum number of directors. II faut remplir cette partie seulement si le nombre d'administrateurs ou si le nombre minimal ou maximal d'administrateurs a change. Number of directors is/are: Nombre d'administrateurs: Number Nombre or ou minimum and maximum number of directors is/are: nombres minimum et maximum d'administrateurs : minimum and maximum minimum et maximum The articles of the corporation are amended as follows: Les statuts de la socibte sont modifies de la fagon suivante : Please refer to pages 1A to 1R (2011/05) Queen's Printer for Ontario, 2011 / Imprimeur de ia Reine pour I'Ontario, 2011 Page 1 of/de 2

2 1A Schedule "A" to the Articles of Amendment of FRESHII INC. (the "Corporation") The articles of the Corporation (the "Articles") are amended as follows: [a] to increase the authorized capital of the Corporation by creating 525,000 Series A Preferred Shares and an unlimited number of Series B Preferred Shares of the Corporation; [b] to delete the existing rights, privileges, restrictions and conditions attaching to the Common Shares and Preferred Shares of the Corporation in its entirety; [c] to provide that the rights, privileges, restrictions and conditions attached to the Common Shares, Series A Preferred Shares and Series B Preferred Shares shall be as follows: Subject to the requirements of the Business Corporations Act (Ontario) (the "Act"), the Common Shares of the Corporation (the "Common Shares"), the Series A Preferred Shares of the Corporation (the "Series A Preferred Shares") and the Series B Preferred Shares of the Corporation (the "Series B Preferred Shares" and together with the Series A Preferred Shares, the "Preferred Shares") shall have the rights, privileges, restrictions and conditions set forth herein. The Common Shares, Series A Preferred Shares and Series B Preferred Shares together are sometimes herein referred to as the "Shares". For the purposes of these Articles, the term "as if converted" means that each holder of Series B Preferred Shares is to be treated as holding the nearest number of whole Common Shares into which the Preferred Shares held by such holder are then convertible (as adjusted from time to time pursuant to the terms and provisions hereof). A. Common Share Terms (1) Dividends The holders of Common Shares shall be entitled to receive, subject to the rights of the holders of other class(es) of shares, any dividend declared by the Corporation with respect to Common Shares. (2) Dissolution The holders of Common Shares shall be entitled to receive, subject to the rights of the holders of other class(es) of shares, the remaining property of the Corporation on the liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary. (3) Voting

3 IB The holders of Common Shares shall be entitled to vote at all meetings of shareholders of the Corporation, except meetings at which only holders of a specified class of shares are entitled to vote. B. Series A Preferred Share Terms (1) Priority The Series A Preferred Shares shall rank, as regards return of capital, in priority to the Common Shares of the Corporation but junior to and in lower priority to the Series B Preferred Shares and shall not confer any right to participate in the profits or further right to participate in the assets of the Corporation. (2) Redemption Subject to the provisions of the Act and these amendments to the Articles (the "Articles of Amendment"), the Corporation may redeem, upon giving notice as hereinafter provided, the whole or any part of the Series A Preferred Shares on payment for each share to be redeemed of the amount paid up thereon; in case a part only of the then outstanding Series A Preferred Shares is at any time to be redeemed, the shares so to be redeemed shall be selected by lot in such manner as the directors in their discretion shall decide or, if the directors so determine, may be redeemed pro rata, disregarding fractions, and the directors may make such adjustments as may be necessary to avoid the redemption of fractional parts of shares. (3) Purchase for Cancellation Subject to the provisions of the Act and these Articles of Amendment, the Corporation shall have the right at its option, at any time and from time to time, to purchase the whole or any part of the Series A Preferred Shares at the lowest price at which, in the opinion of the directors, such shares are obtainable, but not exceeding the amount paid up thereon. (4) Liquidation or Dissolution In the event of a Liquidation Event or Dissolution Event the holders of Series A Preferred Shares shall be entitled to receive, after satisfaction of the obligations of the Corporation to pay the Liquidation Preference per share holders of Series B Preferred Shares pursuant to Section Part C2A below but before any distribution of any part of the assets of the Corporation among the holders of any Common Shares or otherwise among holders of Series B Preferred Shares, an amount equal to the amount paid up thereon and no more. (5) No Dividends

4 1C The holders of Series A Preferred Shares shall not be entitled to receive, and the Corporation shall not declare, any dividend with respect to Series A Preferred Shares. (6) Non-Voting The holders of Series A Preferred Shares shall not, as such, have any voting rights for the election of directors or, subject to any voting rights accorded them pursuant to the provisions of the Act, for an other purpose nor, except for the purpose of exercising any voting rights accorded to them pursuant to the provisions of the Act, shall they be entitled to attend shareholders' meetings. C. Series B Preferred Share Terms 1. Dividends. 1A. Preferential Dividends. In the event that the Corporation declares or pays any dividends upon the Common Shares (whether payable in cash, securities or other property), the Corporation simultaneously shall declare and pay dividends in like form to the holders of the Series B Preferred Shares pro rata with such dividend on the Common Shares in accordance to each such holder's percentage ownership of all Common Shares of the Corporation on an as if converted basis. In addition, dividends on each share of the Series B Preferred Shares (a "Preferred Share"! shall accrue on a daily basis at the rate of 8% per annum (based on a 365 day year), accruing annually, on the sum of the Liquidation Value thereof (which sum shall be determined annually by accumulation of dividends accrued but unpaid during the prior twelve (12) months on each annual anniversary of August 25, 2010 or, if applicable, for the period from the last annual anniversary through the date immediately preceding payment of dividends), from and including August 25, 2010 to and including the first to occur of (i) the date on which the Liquidation Principal Amount of such Series B Preferred Share is paid to the holder thereof in connection with a Liquidation Event, Dissolution Event, or the redemption of such Series B Preferred Share by the Corporation, (ii) the date on which such Series B Preferred Share is otherwise acquired by the Corporation, or (iii) the date on which such Series B Preferred Share is converted into a Common Share. Such dividends shall be payable and shall be paid in full in accordance with these Articles of Incorporation immediately prior to the occurrence of (i) a Liquidation Event or a Public Offering, (ii) a Dissolution Event, (iii) the redemption of Series B Preferred Shares by the Corporation, or (iv) conversion of such Series B Preferred Shares into Common Shares. Such dividends shall accrue whether or not they have been declared and whether or not there are profits, surplus or other funds of the Corporation legally available for the payment of dividends, and such dividends shall be cumulative. Such accrued and unpaid dividends shall be recorded on the books and records and after such dividends have stopped accruing, on the financial statements of the Corporation. The date on which the Corporation initially issues any Preferred Shares shall be deemed to be its "date of issuance" regardless of the number of times a transfer of such Preferred Share is made on the share records maintained by or for the Corporation and regardless of the number of certificates which may be issued to evidence such Preferred Share. 2. Liquidation or Dissolution.

5 ID 2A. Upon any Fundamental Change or Change of Ownership or Public Offering that is not a Qualified Public Offering (a "Liquidation Event") or any a liquidation, dissolution or winding up of the Corporation (whether voluntary or involuntary) (a "Dissolution Event"), each holder of Series B Preferred Shares shall be entitled to receive only the following, in connection with the closing of such Liquidation Event or occurrence of a Dissolution Event and before any distribution or payment is made upon any Junior Securities: payment of cash equal to the Liquidation Value per Share of Series B Preferred Shares plus payment in full satisfaction of all accrued and unpaid dividends ("Liquidation Principal Amount") and also on an as if converted basis to receive its pro rata portion of the greater of the fair value attributable to the Common Shares or of all proceeds distributable to holders of Common Shares (the "Preferred Distribution with respect to Common Shares") (the sum of the Liquidation Principal Amount and the Preferred Distribution with respect to Common shares is the "Liquidation Preference"). 2B. As soon as practicable prior to the payment date stated therein, the Corporation shall mail written notice of any Liquidation Event or Dissolution Event, as the case may be, to each record holder of Series B Preferred Shares, setting forth in reasonable detail the amount of reasonably estimated aggregate proceeds therefrom, anticipated amount to be paid with respect to each Series A Preferred Share, each Series B Preferred Share, and each Common Share in connection with a Liquidation Event or Dissolution Event, as the case may be. The Corporation shall give each holder of Series B Preferred Shares prompt written notice of any material change in the estimated proceeds or other amounts to be paid, other terms and conditions, or timing of the anticipated Liquidation Event or Dissolution Event to the extent known to the Corporation. 2C. If upon any such Liquidation Event or Dissolution Event, as the case may be, the amounts to be distributed among the holders of the Series B Preferred Shares are insufficient to permit payment to such holders of the aggregate amount of Liquidation Preference which they are entitled to be paid under this Section 2. then the entire assets available to be distributed to the Corporation's shareholders shall be distributed pro rata among such holders of Series B Preferred Shares. After payment in full of all amounts due with respect to the applicable Liquidation Preference to the holders of the Series B Preferred Shares under this Section 2. the holders of Series A Preferred Shares shall receive pro rata distribution (each in accordance with its percentage ownership of such Series A Preferred Shares) of any remaining assets of the Corporation available for distribution to the shareholders of the Corporation up to a maximum distribution to each holder of Series A Preferred Shares equal to the amount paid to the Corporation for issuance of such share. After payment in full of all Liquidation Preference due to the holders of the Series B Preferred Shares and all amounts due to the Series A Preferred Shares under this Section 2, the holders of Common Shares, shall receive pro rata distribution (each in accordance with its percentage ownership of such Common Shares) of any remaining assets of the Corporation available for distribution to the shareholders of the Corporation. 3. Voting Rights. Except as otherwise required by applicable law, the holders of the Series B Preferred Shares shall be entitled to notice of all shareholders meetings in accordance with the

6 IE Corporation's bylaws and Shareholders Agreement, and the holders of the Series B Preferred Shares shall be entitled to vote on all matters submitted to the shareholders for a vote, in each case voting together with the holders of the Common Shares, with each holder of Series B Preferred Shares entitled to one vote for each Common Share issuable upon conversion of the Series B Preferred Shares as of the record date for such vote or, if no record date is specified, as of the date of such vote. The holders of any Series B Preferred Shares retain all rights for such Series B Preferred Shares (including voting rights under this Section 3) at all times (including the period after the delivery of a redemption notice) until payment has been made in full for such Series B Preferred Shares. 4. Conversion. 4A. Conversion Procedure. (i) At any time and from time to time, any holder of Series B Preferred Shares may convert all or any portion of the Series B Preferred Shares (including any fraction of a Series B Preferred Share) held by such holder into a number of Conversion Shares computed by multiplying the number of Series B Preferred Shares to be converted by the Original Price, adding accrued but unpaid Dividends and dividing the result by the Conversion Price then in effect. (ii) Except as otherwise provided herein, each conversion of Series B Preferred Shares shall be deemed to have been effected as of the close of business on the date on which the certificate or certificates representing the Series B Preferred Shares to be converted have been surrendered for conversion, or an affidavit of lost certificate, in form and content reasonably acceptable to the Corporation; provided, however, in the case of voluntary conversions not in connection with a Liquidation Event, Dissolution Event or Mandatory Conversion pursuant to Section 4(H) below, such conversions shall be deemed to have been effective upon delivery of a written notice to such effect. At the time any such conversion has been effected, the rights of the holder of such converted Series B Preferred Shares shall cease and the Person or Persons in whose name or names any certificate or certificates for shares of Conversion Share are to be issued upon such conversion shall be deemed to have become the holder or holders of record of the Conversion Shares represented thereby. (iii) The conversion rights of any Series B Preferred Share subject to redemption by the Corporation shall terminate upon payment in full for such Series B Preferred Share by the Corporation. (iv) Notwithstanding any other provision hereof, if a conversion of Series B Preferred Share is to be made in connection with a Public Offering, a Change in Ownership, a Fundamental Change or other transaction affecting the Corporation, the conversion of any Preferred Shares may, at the election of the holder thereof, be conditioned upon the consummation of such transaction, in which case such conversion shall not be deemed to be effective until such transaction has been consummated.

7 ' IF (v) Reasonably promptly after a conversion has been effected pursuant hereto, the Corporation shall deliver to the converting holder, subject to the prior receipt of the holders' converted Series B Preferred Shares certificates or lost certificate affidavit as provided above: (a) a certificate or certificates representing the number of Conversion Shares issuable by reason of such conversion in the name of the converting holder; and (b) a certificate representing any Preferred Shares that were represented by the certificate or certificates delivered to the Corporation in connection with such conversion but which were not converted. (vi) The issuance of certificates for Conversion Shares upon conversion of Series B Preferred Shares shall be made without charge to the holders of such Series B Preferred Shares for any issuance tax in respect thereof or other cost incurred by the Corporation in connection with such conversion and the related issuance of shares of Conversion Share. Upon conversion of each Series B Preferred Share, the Corporation shall take all such actions as are necessary in order to insure that the Conversion Share issuable with respect to such conversion shall be validly issued, fully paid and nonassessable, free and clear of all taxes, liens, charges and encumbrances with respect to the issuance thereof, other than restrictions imposed by applicable securities laws. (vii) The Corporation shall not close its books against the transfer of Series B Preferred Shares or of Conversion Shares issued or issuable upon conversion of Series B Preferred Shares in any manner that interferes with the timely conversion of Series B Preferred Shares. The Corporation shall assist and cooperate with any holder of Series B Preferred Shares required to make any governmental filings or obtain any governmental approval prior to or in connection with any conversion of Series B Preferred Shares hereunder (including, without limitation, making any filings required to be made by the Corporation) at the Corporation's expense. (viii) The Corporation shall at all times reserve and keep available out of its authorized but unissued Conversion Shares, solely for the purpose of issuance upon the conversion of the Series B Preferred Shares, such number of Conversion Shares issuable upon the conversion of all outstanding Series B Preferred Shares. All Conversion Shares that are so issuable shall, when issued, be duly and validly issued, fully paid and nonassessable and free from all taxes, liens and charges. The Corporation shall take all such actions as may be necessary to assure that all such Conversion Shares may be so issued without violation of any applicable law or governmental regulation or any requirements of any domestic securities exchange upon which Conversion Shares may be listed (except for official notice of issuance which shall be immediately delivered by the Corporation upon each such issuance). The Corporation shall not take any action which would cause the number of authorized but unissued Conversion Shares to be less than the number of such shares required to be reserved hereunder for issuance upon conversion of the Series B Preferred Shares. (ix) If the Conversion Shares issuable by reason of conversion of Series B Preferred Shares are convertible into or exchangeable for any other share or securities of the

8 1G Corporation, the Corporation shall, at the converting holder's option, upon surrender of the Series B Preferred Shares to be converted by such holder as provided herein together with any notice, statement or payment required to effect such conversion or exchange of Conversion Shares, deliver to such holder or as otherwise specified by such holder a certificate or certificates representing the share or securities into which the Conversion Shares issuable by reason of such conversion are so convertible or exchangeable, registered in such name or names and in such denomination or denominations as such holder has specified. 4B. Conversion Price. (i) The initial Conversion Price shall be the Original Price. In order to prevent dilution of the conversion rights granted under this Section 4. the Conversion Price shall be subject to adjustment from time to time pursuant to this Section 4B. (ii) If and whenever on or after the original date of issuance of the Series B Preferred Shares, the Corporation issues or sells, or in accordance with Section 4C is deemed to have issued or sold, any shares of its Conversion Shares for a consideration per share less than the Conversion Price in effect immediately prior to the time of such issue or sale, then immediately upon such issue or sale or deemed issue or sale the Conversion Price shall be reduced to the Conversion Price determined by dividing (a) the sum of (1) the product derived by multiplying the Conversion Price in effect immediately prior to such issue or sale by the number of Common Shares Deemed Outstanding immediately prior to such issue or sale, plus (2) the consideration, if any, received by the Corporation upon such issue or sale, by (b) the number of Common Shares Deemed Outstanding immediately after such issue or sale. (iii) Notwithstanding the foregoing, there shall be no adjustment in the Conversion Price as a result of any issue or sale (or deemed issue or sale) of (a) Common Shares issued upon conversion of the Series B Preferred Shares, (b) securities for which an adjustment is already made pursuant to Section 4D. (c) up to 1,583,970 Common Shares to employees, directors or consultants of the Corporation and its Subsidiaries pursuant to share option plans and share ownership plans approved by the Corporation's Board of Directors (the "Board of Directors") (as such number of shares is proportionately adjusted for subsequent share splits, combinations and dividends affecting the Common Shares and as such number includes all such share options and purchase rights outstanding at the time of the issuance of the Series B Preferred Share), (d) securities issued in connection with the acquisition of any business that is a bona fide, arms' length transaction (as determined in good faith by the Board of Directors), which has been approved by the Board of Directors including the Director(s) nominated by the holders of Series B Preferred Shares, (e) securities issued pursuant to or in connection with any strategic alliance, joint venture or corporate partnership that is a bona fide, arms' length transaction (as determined in good faith by the Board of Directors) which has been approved by the Board of Directors including the Director(s) nominated by the Series B Preferred, (f) securities issued to banks, equipment lessors or similar financial institutions in connection with a bank financing, equipment lease or other comparable transaction that is a bona fide, arm's length transaction (as determined in good faith by the Board of Directors) which has been approved by the Board of Directors, including the Director(s) nominated by the holders of Series B Preferred Shares and which do not in the aggregate exceed 2.0% of the Common Shares Deemed

9 1H Outstanding, and (g) and securities for which the holders of a majority of the Series B Preferred Shares then outstanding have elected (by vote or written consent) to exclude from the provisions of this Section 4B. 4C. Effect on Conversion Price of Certain Events. For purposes of determining the adjusted Conversion Price under Section 4B. the following shall be applicable: (i) Issuance of Rights or Options. If the Corporation in any manner grants or sells any Options and the price per share for which a Common Share is issuable upon the exercise of such Options, or upon conversion or exchange of any Convertible Securities issuable upon exercise of such Options, is less than the Conversion Price in effect immediately prior to the time of the granting or sale of such Options, then the total maximum number of Common Shares issuable upon the exercise of such Options or upon conversion or exchange of the total maximum amount of such Convertible Securities issuable upon the exercise of such Options shall be deemed to be outstanding and to have been issued and sold by the Corporation at the time of the granting or sale of such Options for such price per share. For purposes of this Section, the "price per share for which a Common Share is issuable" shall be determined by dividing (A) the total amount, if any, received or receivable by the Corporation as consideration for the granting or sale of such Options, plus the minimum aggregate amount of additional consideration payable to the Corporation upon exercise of all such Options, plus in the case of such Options which relate to Convertible Securities, the minimum aggregate amount of additional consideration, if any, payable to the Corporation upon the issuance or sale of such Convertible Securities and the conversion or exchange thereof, by (B) the total maximum number of Common Shares issuable upon the exercise of such Options or upon the conversion or exchange of all such Convertible Securities issuable upon the exercise of such Options. No further adjustment of the Conversion Price shall be made when Convertible Securities are actually issued upon the exercise of such Options or when a Common Share is actually issued upon the exercise of such Options or the conversion or exchange of such Convertible Securities. (ii) Issuance of Convertible Securities. If the Corporation in any manner issues or sells any Convertible Securities and the price per share for which a Common Share is issuable upon conversion or exchange thereof is less than the Conversion Price in effect immediately prior to the time of such issue or sale, then the maximum number of Common Shares issuable upon conversion or exchange of such Convertible Securities shall be deemed to be outstanding and to have been issued and sold by the Corporation at the time of the issuance or sale of such Convertible Securities for such price per share. For the purposes of this Section, the "price per share for which a Common Share is issuable" shall be determined by dividing (A) the total amount received or receivable by the Corporation as consideration for the issue or sale of such Convertible Securities, plus the minimum aggregate amount of additional consideration, if any, payable to the Corporation upon the conversion or exchange thereof, by (B) the total maximum number of Common Shares issuable upon the conversion or exchange of all such Convertible Securities. No further adjustment of the Conversion Price shall be made when a Common Share is actually issued upon the conversion or exchange of such Convertible Securities, and if any such issue or sale of such Convertible Securities is made upon exercise of any Options for which adjustments of the Conversion Price had been or are to be made pursuant

10 II to other provisions of this Section 4. no further adjustment of the Conversion Price shall be made by reason of such issue or sale. (iii) Change in Option Price or Conversion Rate. If the purchase price provided for in any Options, the additional consideration, if any, payable upon the conversion or exchange of any Convertible Securities or the rate at which any Convertible Securities are convertible into or exchangeable for Common Shares changes at any time, the Conversion Price in effect at the time of such change shall be immediately adjusted to the Conversion Price which would have been in effect at such time had such Options or Convertible Securities still outstanding provided for such changed purchase price, additional consideration or conversion rate, as the case may be, at the time initially granted, issued or sold; provided that if such adjustment would result in an increase of the Conversion Price then in effect, such adjustment shall not be effective until 15 days after written notice thereof has been given by the Corporation to all holders of the Series B Preferred Shares. For purposes of Section 4C. if the terms of any Option or Convertible Security which was outstanding as of the date of issuance of the Series B Preferred Share are changed in the manner described in the immediately preceding sentence, then such Option or Convertible Security and the Common Shares deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such change; provided that no such change shall at any time cause the Conversion Price hereunder to be increased. (iv) Treatment of Expired Options and Unexercised Convertible Securities. Upon the expiration of any Option or the termination of any right to convert or exchange any Convertible Security without the exercise of any such Option or right, the Conversion Price then in effect hereunder shall be adjusted immediately to the Conversion Price which would have been in effect at the time of such expiration or termination had such Option or Convertible Security, to the extent outstanding immediately prior to such expiration or termination, never been issued; provided that if such expiration or termination would result in an increase in the Conversion Price then in effect, such increase shall not be effective until 15 days after written notice thereof has been given to all holders of the Series B Preferred Shares; further provided. that such expiration or termination shall have no effect on any shares of Conversion Share issued prior to such expiration or termination. For purposes of Section 4C, the expiration or termination of any Option or Convertible Security which was outstanding as of the date of issuance of the Series B Preferred Shares shall not cause the Conversion Price hereunder to be adjusted unless, and only to the extent that, a change in the terms of such Option or Convertible Security caused it to be deemed to have been issued after the date of issuance of the Series B Preferred Shares. (v) Calculation of Consideration Received. If any Common Share, Option or Convertible Security is issued or sold or deemed to have been issued or sold for cash, the consideration received therefor shall be deemed to be the amount received by the Corporation therefor (net of discounts, commissions and related expenses). If any Common Share, Option or Convertible Security is issued or sold for a consideration other than cash, the amount of the consideration other than cash received by the Corporation shall be the fair value of such consideration, except where such consideration consists of securities, in which case the amount of consideration received by the Corporation shall be the Market Price thereof as of the date of receipt. If any Common Share, Option or Convertible Security is issued to the owners of the

11 1J non-surviving entity in connection with any merger in which the Corporation is the surviving corporation, the amount of consideration therefor shall be deemed to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable to such Common Share, Option or Convertible Security, as the case may be. The fair value of any consideration other than cash and securities shall be determined by the Board of Directors in good faith. If the holders of a majority of the outstanding Series B Preferred Shares object to such determination by the Board of Directors then, upon the written request of the holders of a majority of the Series B Preferred Shares, each of the Corporation and such holders acting together shall retain an appraiser experienced in valuing such type of consideration to determine the fair value of such consideration. If the two appraisers are unable to reach agreement within a reasonable period of time, the fair value of such consideration shall be determined by a third independent appraiser experienced in valuing such type of consideration selected by the first two appraisers. The determination of such two appraisers, or if applicable, of such third appraiser, shall be final and binding upon the parties. The fees and expenses of the appraisers shall be borne by the holders of the Series B Preferred Shares pro rata in accordance with their percentage ownership, and such holders shall deliver to the Corporation, prior to the retention of any appraisers as set forth above, an undertaking, in form a substance reasonably satisfactory to the Corporation, that the holders will make such payment. (vi) Integrated Transactions. In case any Option is issued in connection with the issue or sale of other securities of the Corporation, together comprising one integrated transaction in which no specific consideration is allocated to such Option by the parties thereto, the Option shall be deemed to have been issued for a consideration of $0.01. (vii) Treasury Shares. The number of Common Shares outstanding at any given time shall not include shares owned or held by or for the account of the Corporation or any Subsidiary, and the disposition of any shares so owned or held shall be considered an issue or sale of Common Shares. (viii) Record Date. If the Corporation takes a record of the holders of Common Shares for the purpose of entitling them (a) to receive a dividend or other distribution payable in Common Shares, Options or in Convertible Securities or (b) to subscribe for or purchase Common Shares, Options or Convertible Securities, then such record date shall be deemed to be the date of the issue or sale of the Common Shares deemed to have been issued or sold upon the declaration of such dividend or upon the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be. 4D. Subdivision or Combination of Common Shares. If the Corporation at any time subdivides (by any share split, share dividend, recapitalization or otherwise) one or more classes of its outstanding Common Shares into a greater number of shares, the Conversion Price in effect immediately prior to such subdivision shall be proportionately reduced, and if the Corporation at any time combines (by reverse share split or otherwise) one or more classes of its outstanding Common Shares into a smaller number of shares, the Conversion Price in effect immediately prior to such combination shall be proportionately increased.

12 IK 4E. Reorganization, Reclassification. Consolidation or Merger. Any recapitalization, reorganization, reclassification, consolidation, merger, sale of all or substantially all of the Corporation's assets or other transaction, in each case which is effected in such a manner that the holders of Common Shares are entitled to receive (either directly or upon subsequent liquidation) shares, securities or assets with respect to or in exchange for Common Shares, is referred to herein as an "Organic Change". Prior to the consummation of any Organic Change after which shares of Series B Preferred Shares remain outstanding, the Corporation shall make appropriate provisions (in form and substance reasonably satisfactory to the holders of a majority of the Series B Preferred Shares then outstanding) to insure that each of the holders of Series B Preferred Shares shall thereafter have the right to acquire and receive, in lieu of or in addition to (as the case may be) the Conversion Shares immediately theretofore acquirable and receivable upon the conversion of such holder's Series B Preferred Shares, such shares, securities or assets as such holder would have received in connection with such Organic Change if such holder had converted its Series B Preferred Shares immediately prior to such Organic Change. In each such case, the Corporation shall also make appropriate provisions (in form and substance reasonably satisfactory to the holders of a majority of the Series B Preferred Shares then outstanding) to insure that the provisions of this Section 4 and Section 5 hereof shall thereafter be applicable to the Series B Preferred Shares (including, in the case of any such consolidation, merger or sale in which the successor entity or purchasing entity is other than the Corporation, an immediate adjustment of the Conversion Price to the value for the Common Shares reflected by the terms of such consolidation, merger or sale, and a corresponding immediate adjustment in the number of shares of Conversion Share acquirable and receivable upon conversion of Series B Preferred Shares, if the value so reflected is less than the Conversion Price in effect immediately prior to such consolidation, merger or sale). The Corporation shall not effect any such Organic Change unless prior to the consummation thereof, the successor entity (if other than the Corporation) resulting from such Organic Change assumes by written instrument (in form and substance satisfactory to the holders of a majority of the Series B Preferred Shares then outstanding), the obligation to deliver to each such holder such shares, securities or assets as, in accordance with the foregoing provisions, such holder may be entitled to acquire. 4F. Certain Events. If any event occurs of the type contemplated by the provisions of this Section 4 but not expressly provided for by such provisions (including, without limitation, the granting of share appreciation rights, phantom share rights or other rights with equity features), then the Board of Directors shall make an appropriate adjustment in the Conversion Price so as to protect the rights of the holders of Series B Preferred Shares; provided that no such adjustment shall increase the Conversion Price as otherwise determined pursuant to this Section 4 or decrease the number of Conversion Shares issuable upon conversion of each share of Series B Preferred Shares. 4G. Notices. (i) As soon as practicable following any adjustment of the Conversion Price, the Corporation shall give written notice thereof to all holders of Series B Preferred Shares, setting forth in reasonable detail such adjustment.

13 1L (ii) The Corporation shall give written notice to all holders of Series B Preferred Shares at least 10 days prior to the date on which the Corporation closes its books or takes a record (a) with respect to any dividend or distribution upon Common Share, (b) with respect to any pro rata subscription offer to holders of Common Shares or (c) for determining rights to vote with respect to any Organic Change, dissolution or liquidation. (iii) The Corporation shall also give written notice to the holders of Series B Preferred Shares as soon as reasonably practicable prior to the date on which any Organic Change shall take place. 4H. Mandatory Conversion. The Corporation may require the conversion of all outstanding Series B Preferred Shares together with all accrued Dividends immediately prior to the closing of a Qualified Public Offering. The holders of seventy percent (70%) of the Series B Preferred Shares outstanding may by written consent require conversion of all outstanding Series B Preferred Shares upon a date designated in such written consent. 5. Triggering Events. 5A. Definition. A Triggering Event shall have occurred if (A) the Corporation makes an assignment for the benefit of creditors or admits in writing its inability to pay its debts generally as they become due or files any petition or application before any tribunal, for the appointment of a custodian, trustee, receiver or liquidator of the Corporation or any substantial part of the assets of the Corporation, or commences any proceeding under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation or any jurisdiction any petition, or (B) application is filed against the Corporation, before any tribunal, for the appointment of a custodian, trustee, receiver or liquidator of the Corporation or of any substantial part of the assets of the Corporation, and such petition, application or proceeding is not dismissed within 60 days. 5B. Consequences of Triggering Events. (i) If a Triggering Event has occurred and is continuing (the "Existing Triggering Event"), the Directors nominated by the holders of Series B Preferred Shares shall constitute a special committee of the Board of Directors. Such special committee shall have the authority to take any action that may be taken by the Board of Directors to the extent, in the reasonable good faith judgment of the special committee, such action is necessary to remedy the Existing Triggering Event. The Directors nominated by the holders of Series B Preferred Shares shall act as such special committee of the Board of Directors only until such time as the Triggering Event no longer exists or the special committee determines in its sole discretion that the Triggering Event is incapable of being cured, at which time such special authority shall immediately cease and such special committee shall automatically dissolve. The actions approved to be taken by of a majority of the members of such special committee shall constitute the acts of such special committee if notice of the meeting at which such actions are approved was given to all of the members of such special committee pursuant to the bylaws of the Corporation.

14 1M 6. Definitions. "Change in Ownership" means any sale, transfer or issuance or series of sales, transfers or issuances of Common Shares by any holders thereof which results in any Person or group of Persons, other than the holders of Common Shares and Series B Preferred Shares as of August 25, 2010 and Permitted Transferees, owning more than 50% of the Common Shares outstanding at the time of such sale, transfer or issuance or series of sales, transfers and/or issuances. "Common Shares" means the common shares in the capital of the Corporation. "Common Shares Deemed Outstanding" means, at any given time, the number of shares of Common Shares actually outstanding at such time, plus the number of Common Shares deemed to be outstanding pursuant to Sections 4C(T) and 4C(if) hereof whether or not the Options or Convertible Securities are actually exercisable at such time. "Conversion Share" means Common Shares issuable upon conversion of Series B Preferred Shares; provided that if there is a change such that the securities issuable upon conversion of the Series B Preferred Shares are issued by an entity other than the Corporation or there is a change in the type or class of securities so issuable, then the term "Conversion Share" shall mean one share of the security issuable upon conversion of the Series B Preferred Shares if such security is issuable in shares, or shall mean the smallest unit in which such security is issuable if such security is not issuable in shares. "Convertible Securities" means any share or securities directly or indirectly convertible into or exchangeable for Common Shares. "Family Group" means, with respect to any holder of Common Shares, such holder's parents, siblings, spouse (current or former) and descendants (whether natural or adopted) and any trust, limited partnership or other entity solely for the benefit of such holder and/or such holder's spouse and/or descendants. "Fundamental Change" means (a) any sale or transfer of more than 50% of the assets of the Corporation and its Subsidiaries on a consolidated basis (measured either by book value in accordance with generally accepted accounting principles consistently applied or by fair market value determined in the reasonable good faith judgment of the Board of Directors) in any transaction or series of transactions (other than sales in the ordinary course of business) and (b) any merger or consolidation to which the Corporation is a party; provided, however that a merger meeting the following conditions is not a Fundamental Change: a merger in which the Corporation is the surviving corporation, the terms of the Series B Preferred Shares are not changed, the Series B Preferred Shares are not exchanged for cash, securities or other property, and after giving effect to such merger, the holders of the Corporation's outstanding capital share possessing a majority of the voting power (under ordinary circumstances) to elect a majority of the Board of Directors immediately prior to the merger shall continue to own the Corporation's outstanding capital share possessing the voting power (under ordinary circumstances) to elect a majority of the Board of Directors.

15 IN "Junior Securities" means any capital share or other equity securities of the Corporation, except for the Series B Preferred Shares. "Liquidation Value" of any Preferred Share as of any particular date shall be equal to the Original Price (as proportionately adjusted for all subsequent share splits, share dividends, and other recapitalizations or reclassifications affecting the Series B Preferred Shares). "Market Price" of any security means the average of the closing prices of such security's sales on all securities exchanges on which such security may at the time be listed, or, if there has been no sales on any such exchange on any day, the average of the highest bid and lowest asked prices on all such exchanges at the end of such day, or, if on any day such security is not so listed, the average of the representative bid and asked prices quoted on any electronic or over-the-counter market on which recognized third party reporting of bid and ask prices is regularly available, in each such case (i) averaged over a period of 21 days consisting of the day as of which "Market Price" is being determined and the 20 consecutive business days prior to such day, and (ii) averaged on a volume-weighted basis based on the trading volume for each such business day. If at any time such security is not listed on any securities exchange or quoted on any electronic or over-the-counter market, the "Market Price" shall be the fair value thereof determined by the Board of Directors in good faith. If the holders of a majority of the outstanding Series B Preferred Shares object to such determination by the Board of Directors then, upon the written request of the holders of a majority of the Series B Preferred Shares, each of the Corporation and such holders shall retain an appraiser experienced in valuing securities to determine the fair value. If the two appraisers are unable to reach agreement within a reasonable period of time, the fair value shall be determined by a third independent appraiser experienced in valuing securities selected by the first two appraisers jointly. The determination of such two appraisers, or if applicable, of such third appraiser, shall be final and binding upon the parties. The fees and expenses of the appraisers shall be borne by the holders of the Series B Preferred Shares, and such holders shall deliver to the Corporation, prior to the retention of any appraisers as set forth above, an undertaking, in form a substance satisfactory to the Corporation, that the holders will make such payment. "Options" means any rights, warrants or options to subscribe for, purchase or otherwise acquire Common Shares or Convertible Securities. per share. "Original Price" shall equal, with respect to the Series B Preferred Shares, $0.36 "Permitted Transferee" means (i) with respect to a transfer by any holder of Common Shares that are not issued upon conversion of a convertible promissory note issued by the Corporation or upon conversion of Series B Preferred Shares, (A) any Person to whom Common Shares owned by such holder are transferred following the death of such holder, pursuant to applicable laws of descent and distribution or (B) a member of such holder's Family Group, and (ii) with respect to a transfer by any holder of Common Shares that are issued upon conversion of a convertible promissory note issued by the Corporation or upon conversion of

16 10 Series B Preferred Shares or the transfer of Series B Preferred Shares, to any members of any limited liability company or to beneficiaries of any trust, or to partners of any partnership that holds Series B Shares, in each case as such members, beneficiaries, and partners exist as of August 25,2010. "Person" means an individual, a partnership, a corporation, a limited liability company, an association, a joint share company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof. "Public Offering" means any offering by the Corporation of its capital share or equity securities to the public pursuant to an effective registration statement under the Securities Act or any comparable statement under any applicable U.S. or Canadian securities statute then in force. "Qualified Public Offering" means any offering by the Corporation of its capital share or equity securities to the public pursuant to an effective registration statement under the Securities Act or any comparable statement under any U.S. or Canadian securities statute then in force having an aggregate offering value of at least $30 million (prior to underwriter commissions and expense) and a price per share of at least $1.80. time. "Securities Act" means the U.S. Securities Act of 1933, as amended from time to "Shareholders Agreement" means the Shareholders Agreement, dated as of August 8, 2007, as thereafter amended and amended and restated, by and among the Corporation and the other parties signatory thereto, as such agreement may from time to time be amended in accordance with its terms. "Subsidiary" means, with respect to any Person, any corporation, limited liability company, partnership, association or other business entity of which (i) if a corporation, a majority of the total voting power of shares of share entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a limited liability company, partnership, association or other business entity, a majority of the partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association or other business entity if such Person or Persons shall be allocated a majority of limited liability company, partnership, association or other business entity gains or losses or shall be or control any managing general partner of such limited liability company, partnership, association or other business entity.