EXHIBIT 10.3
 
EXCHANGE TRUST AGREEMENT
 
THIS AGREEMENT made as of this 22nd day of June, 2011
 
AMONG:
 
2230354 ONTARIO INC., a corporation existing under the laws of the Province of
Ontario
 
(the “Company”)
 
- and -
 
POLAR WIRELESS CORP., a corporation existing under the laws of the State of
Nevada
 
(“Polar”)
 
- and -
 
2240519 ONTARIO LIMITED, a corporation existing under the laws of the Province
of Onatrio
 
(the “Trustee”)
 
WHEREAS pursuant to an amalgamation agreement dated the date hereof (the
“Amalgamation Agreement”) among Polar Wireless Corporation (“Subco”), Polar and
the Company, the company formed by the amalgamation of Subco and the Company
(“New Polar”) is to issue Class A non-voting shares (which are exercisable into
Class A Exchangeable Shares) and Class B non-voting shares (which are
exercisable into Class B Exchangeable Shares) to holders of common shares of the
Company pursuant to the amalgamation contemplated by the Amalgamation Agreement;
 
AND WHEREAS it is a condition to the Amalgamation Agreement that Polar and the
Trustee execute this Agreement;
 
NOW THEREFORE in consideration of the respective covenants and agreements
provided in this Agreement and for other good and valuable consideration (the
receipt and sufficiency of which are hereby acknowledged), the parties hereto
hereby covenant and agree as follows:
 
 
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ARTICLE 1
DEFINITIONS AND INTERPRETATION
 
1.1  
Definitions

 
In this Agreement, the following terms shall have the following meanings:
 
“Affiliate” means an affiliated body corporate; one body corporate is affiliated
with another body corporate if one of them is the subsidiary of the other or
both are subsidiaries of the same body corporate or each of them is controlled
by the same person, and if two bodies corporate are affiliated with the same
body corporate at the same time, they are deemed to be affiliated with each
other.
 
“Automatic Exchange Right” means the benefit of the obligation of Polar to
effect the automatic exchange of Polar Shares for Class A Exchangeable Shares
and Polar Preferred Shares for Class B Exchangeable Shares pursuant to Section
3.11.
 
“Polar Affiliates” means Affiliates of Polar.
 
“Polar Liquidation Event” has the meaning ascribed thereto in Section 3.11(b).
 
“Polar Liquidation Event Effective Date” has the meaning ascribed thereto in
Section 3.11(c).
 
“Polar Preferred Shares” has the meaning ascribed to the term “Polar US
Preferred Shares” in the Amalgamation Agreement.
 
“Polar Shares” has the meaning ascribed to the term “Polar US Shares” in the
Amalgamation Agreement.
 
“Polar Successor” has the meaning ascribed thereto in Section 8.1(a).
 
“Beneficiaries” means the registered holders, from time to time, of Class A
Exchangeable Shares and Class B Exchangeable Shares, other than Polar and its
Affiliates.
 
“Board of Directors” means the board of directors of New Polar.
 
“Business Day” means any day other than a Saturday, Sunday or civic or statutory
holiday in the City of Toronto, Ontario.
 
“Callco” means 2240519 Ontario Limited, a corporation existing under the laws of
the Province of Ontario, and a direct wholly-owned subsidiary of Polar.
 
“Canadian Dollar Equivalent” means, in respect of an amount expressed in a
currency other than Canadian dollars (the “Foreign Currency Amount”) at any
date, the product obtained by multiplying (a) the Foreign Currency Amount by (b)
the noon spot exchange rate on such date for such foreign currency expressed in
Canadian dollars as reported by the Bank of Canada or, in the event such spot
exchange rate is not available, such exchange rate on such date for such foreign
currency expressed in Canadian dollars as may be deemed by the Board of
Directors to be appropriate for such purpose.
 
 
 
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“Class A Exchangeable Shares” means the Class A exchangeable shares in the
capital of New Polar, having the rights, privileges, restrictions and conditions
set out in Appendix 1 to the Amalgamation Agreement.
 
“Class B Exchangeable Shares” means the Class B exchangeable shares in the
capital of New Polar, having the rights, privileges, restrictions and conditions
set out in Appendix 1 to the Amalgamation Agreement.
 
“Court” means the Superior Court of Justice (Ontario).
 
“Current Market Price” means, in respect of a Polar Share or Polar Preferred
Share on any date, the Canadian Dollar Equivalent of the average of the closing
prices of Polar Shares or Polar Preferred Share on such stock exchange or
automated quotation system on which the Polar Shares are listed or quoted, as
the case may be, as may be selected by the Board of Directors for such purpose,
on each of the thirty (30) consecutive trading days ending not more than five
trading days before such date; provided, however, that if there is no public
distribution or trading activity of Polar Shares or Polar Preferred Shares
during such period, then the Current Market Price of a Polar Share or Polar
Preferred Share shall be determined by the Board of Directors in good faith, and
provided further that any such determination by the Board of Directors shall be
conclusive and binding.
 
“Exchange Right” has the meaning ascribed thereto in Section 3.1.
 
“Exchangeable Share Provisions” means the rights, privileges, restrictions and
conditions attaching to the Class A Exchangeable Shares and the Class B
Exchangeable Shares.
 
“Indemnified Parties” has the meaning ascribed thereto in Section 6.1.
 
“Insolvency Event” means the institution by New Polar of any proceeding to be
adjudicated a bankrupt or insolvent or to be wound up, or the consent of New
Polar to the institution of bankruptcy, insolvency or winding-up proceedings
against it, or the filing of a petition, answer or consent seeking dissolution
or winding-up under any bankruptcy, insolvency or analogous laws, including,
without limitation, the Companies’ Creditors Arrangement Act (Canada) and the
Bankruptcy and Insolvency Act (Canada) and the failure by New Polar to contest
in good faith any such proceedings commenced in respect of New Polar within 30
days of becoming aware thereof, or the consent by New Polar to the filing of any
such petition or to the appointment of a receiver, or the making by New Polar of
a general assignment for the benefit of creditors, or the admission in writing
by New Polar of its inability to pay its debts generally as they become due, or
New Polar not being permitted, pursuant to solvency requirements of applicable
law, to redeem any Retracted Shares pursuant to Section V.6.6 or VI.6.6 of the
Exchangeable Share Provisions.
 
“Liquidation Call Right” has the meaning ascribed thereto in the Exchangeable
Share Provisions.
 
“OBCA” means the Business Corporations Act (Ontario), as amended.
 
“Officer’s Certificate” means, with respect to Polar or New Polar, as the case
may be, a certificate signed by any one officer of Polar or New Polar, as the
case may be.
 
“Person” includes any individual, firm, partnership, limited liability company,
unlimited liability company, joint venture, venture capital fund, association,
trust, trustee, executor, administrator, legal personal representative, estate,
group, body corporate, corporation, unincorporated association or organization,
governmental entity, syndicate or other entity, whether or not having legal
status.
 
 
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“Redemption Call Right” has the meaning ascribed thereto in the Exchangeable
Share Provisions.
 
“Retracted Shares” has the meaning ascribed thereto in Section 3.6.
 
“Retraction Call Right” has the meaning ascribed thereto in the Exchangeable
Share Provisions.
 
“Support Agreement” means the support agreement dated the date hereof between
223, Callco and Polar, substantially in the form and content of Appendix 2 to
the Amalgamation Agreement, as the same may be amended from time to time
pursuant to the terms of the Support Agreement.
 
“Trust” means the trust created by this Agreement.
 
“Trust Estate” means the Exchange Right, the Automatic Exchange Right and any
money or other securities or property which may be held by the Trustee from time
to time pursuant to this Agreement.
 
“Trustee” means 2240519 Ontario Limited and, subject to the provisions of
Article 7 hereof, includes any successor trustee.
 
1.2  
Interpretation Not Affected by Headings

 
The division of this Agreement into Articles, Sections and other portions and
the insertion of headings are for convenience of reference only and shall not
affect the construction or interpretation of this Agreement. Unless otherwise
indicated, all references to an “Article” or “Section” followed by a number
and/or a letter refer to the specified Article or Section of this Agreement. The
terms “this Agreement”, “hereof”, “herein” and “hereunder” and similar
expressions refer to this Agreement and not to any particular Article, Section
or other portion hereof and include any agreement or instrument supplementary or
ancillary hereto.
 
1.3  
Number, Gender etc.

 
Words importing the singular number only shall include the plural and vice
versa. Words importing any gender shall include all genders.
 
1.4  
Date for any Action

 
If any date on which any action is required to be taken under this Agreement is
not a Business Day, such action shall be required to be taken on the next
succeeding Business Day.
 
 
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ARTICLE 2
PURPOSE OF AGREEMENT
 
2.1  
Establishment of Trust

 
The purpose of this Agreement is to create the Trust for the benefit of the
Beneficiaries, as herein provided. The Trustee will hold the Exchange Right and
the Automatic Exchange Right in order to enable the Trustee to exercise such
rights, in each case as trustee for and on behalf of the Beneficiaries as
provided in this Agreement.
 
 
ARTICLE 3
EXCHANGE RIGHT AND AUTOMATIC EXCHANGE
 
3.1  
Grant and Ownership of the Exchange Right

 
Polar hereby grants to the Trustee as trustee for and on behalf of, and for the
use and benefit of the Beneficiaries, the right (the “Exchange Right”), upon the
occurrence and during the continuance of an Insolvency Event, to require Polar
to purchase from each or any Beneficiary all or any part of the Class A
Exchangeable Shares or the Class B Exchangeable Shares held by the Beneficiary
and the Automatic Exchange Right, all in accordance with the provisions of this
Agreement. Polar hereby acknowledges receipt from the Trustee as trustee for and
on behalf of the Beneficiaries of good and valuable consideration (and the
adequacy thereof) for the grant of the Exchange Right and the Automatic Exchange
Right by Polar to the Trustee. During the term of the Trust and subject to the
terms and conditions of this Agreement, the Trustee shall possess and be vested
with full legal ownership of the Exchange Right and the Automatic Exchange Right
and shall be entitled to exercise all of the rights and powers of an owner with
respect to the Exchange Right and the Automatic Exchange Right, provided that
the Trustee shall:
 
(a)  
hold the Exchange Right and the Automatic Exchange Right and the legal title
thereto as trustee solely for the use and benefit of the Beneficiaries in
accordance with the provisions of this Agreement; and

 
(b)  
except as specifically authorized by this Agreement, have no power or authority
to exercise or otherwise deal in or with the Exchange Right or the Automatic
Exchange Right, and the Trustee shall not exercise any such rights for any
purpose other than the purposes for which the Trust is created pursuant to this
Agreement, and shall not assign or transfer such rights except to a successor
trustee hereunder.

 
3.2  
General Exercise of Exchange Right

 
The Exchange Right shall be and remain vested in and exercisable by the Trustee.
Subject to Section 4.13, the Trustee shall exercise the Exchange Right only on
the basis of instructions received pursuant to this Article 3 from Beneficiaries
entitled to instruct the Trustee as to the exercise thereof. To the extent that
no instructions are received from a Beneficiary with respect to the Exchange
Right, the Trustee shall not exercise or permit the exercise of the Exchange
Right.
 
3.3  
Purchase Price

 
The purchase price payable by Polar for each Class A Exchangeable Share to be
purchased by Polar under the Exchange Right shall be an amount per share equal
to: (a) the Current Market Price of a Polar Share on the last Business Day prior
to the day of closing of the purchase and sale of such Class A Exchangeable
Share under the Exchange Right, which shall be satisfied in full by Polar
causing to be sent to such holder one Polar Share; plus (b) to the extent not
paid by New Polar an additional amount equal to the full amount of all declared
and unpaid dividends on each such Class A Exchangeable Share held by such holder
on any dividend record date which occurred prior to the closing of the purchase
and sale. In connection with each exercise of the Exchange Right, Polar shall
provide to the Trustee an Officer’s Certificate setting forth the calculation of
the purchase price for each Class A Exchangeable Share. The purchase price for
each such Class A Exchangeable Share so purchased may be satisfied only by Polar
issuing and delivering or causing to be delivered to the Trustee, on behalf of
the relevant Beneficiary, one Polar Share and on the applicable payment date a
cheque for the balance, if any of the purchase price without interest (but less
any amounts withheld pursuant to Section 3.12). Upon payment by Polar of such
purchase price, the relevant Beneficiary shall cease to have any right to be
paid any amount in respect of declared and unpaid dividends on each such Class A
Exchangeable Share by Polar.
 
 
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The purchase price payable by Polar for each Class B Exchangeable Share to be
purchased by Polar under the Exchange Right shall be an amount per share equal
to: (a) the Current Market Price of a Polar Preferred Share on the last Business
Day prior to the day of closing of the purchase and sale of such Class B
Exchangeable Share under the Exchange Right, which shall be satisfied in full by
Polar causing to be sent to such holder one Polar Preferred Share; plus (b) to
the extent not paid by New Polar an additional amount equal to the full amount
of all declared and unpaid dividends on each such Class B Exchangeable Share
held by such holder on any dividend record date which occurred prior to the
closing of the purchase and sale. In connection with each exercise of the
Exchange Right, Polar shall provide to the Trustee an Officer’s Certificate
setting forth the calculation of the purchase price for each Class B
Exchangeable Share. The purchase price for each such Class B Exchangeable Share
so purchased may be satisfied only by Polar issuing and delivering or causing to
be delivered to the Trustee, on behalf of the relevant Beneficiary, one Polar
Preferred Share and on the applicable payment date a cheque for the balance, if
any of the purchase price without interest (but less any amounts withheld
pursuant to Section 3.12). Upon payment by Polar of such purchase price, the
relevant Beneficiary shall cease to have any right to be paid any amount in
respect of declared and unpaid dividends on each such Class B Exchangeable Share
by Polar.
 
3.4  
Exercise Instructions

 
Subject to the terms and conditions herein set forth, a Beneficiary shall be
entitled, upon the occurrence and during the continuance of an Insolvency Event,
to instruct the Trustee to exercise the Exchange Right with respect to all or
any part of the Class A Exchangeable Shares or Class B Exchangeable Shares
registered in the name of such Beneficiary on the books of New Polar. To cause
the exercise of the Exchange Right by the Trustee, the Beneficiary shall deliver
to the Trustee, in person or by certified or registered mail, at its principal
office in Toronto, Ontario or at such other places in Canada as the Trustee may
from time to time designate by written notice to the Beneficiaries, the
certificates representing the Class A Exchangeable Shares or Class B
Exchangeable Shares, as the case may be, which such Beneficiary desires Polar to
purchase, duly endorsed in blank for transfer, and accompanied by such other
documents and instruments as may be required to effect a transfer of Class A
Exchangeable Shares or Class B Exchangeable Shares under the laws applicable to
New Polar and the by-laws of New Polar and such additional documents and
instruments as the Trustee may reasonably require together with: (a) a duly
completed form of notice of exercise of the Exchange Right, contained on the
reverse of or attached to the Class A Exchangeable Share or Class B Exchangeable
Share certificate(s), stating: (i) that the Beneficiary thereby instructs the
Trustee to exercise the Exchange Right so as to require Polar to purchase from
the Beneficiary the number of Class A Exchangeable Shares or Class B
Exchangeable Shares specified therein; (ii) that such Beneficiary has good title
to and owns all such Class A Exchangeable Shares or Class B Exchangeable Shares
to be acquired by Polar free and clear of all liens, claims and encumbrances;
(iii) the names in which the certificates representing Polar Shares or Polar
Preferred Shares issuable in connection with the exercise of the Exchange Right
are to be issued; and (iv) the names and addresses of the persons to whom such
new certificates should be delivered; and (b) payment (or evidence satisfactory
to the Trustee, Polar and New Polar of payment) of the taxes (if any) payable as
contemplated by Section 3.7. If only a part of the Class A Exchangeable Shares
or Class B Exchangeable Shares represented by any certificate or certificates
delivered to the Trustee are to be purchased by Polar under the Exchange Right,
a new certificate for the balance of such Class A Exchangeable Shares or Class B
Exchangeable Shares, as applicable, shall be issued to the holder at the expense
of New Polar.
 
 
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3.5  
Delivery of Polar Shares; Effect of Exercise

 
Promptly after receipt of the certificate(s) representing the Class A
Exchangeable Shares or Class B Exchangeable Shares which the Beneficiary desires
Polar to purchase under the Exchange Right, together with such documents and
instruments of transfer and a duly completed form of notice of exercise of the
Exchange Right (and payment of taxes, if any, payable as contemplated by Section
3.7 or evidence thereof), duly endorsed for transfer to Polar, the Trustee shall
notify Polar and New Polar of its receipt of the same, which notice to Polar and
New Polar shall constitute exercise of the Exchange Right by the Trustee on
behalf of the holder of such Class A Exchangeable Shares or Class B Exchangeable
Shares, as the case may be, and Polar shall promptly thereafter deliver or cause
to be delivered to the Trustee, for delivery to the Beneficiary of such Class A
Exchangeable Shares or Class B Exchangeable Shares (or to such other persons, if
any, properly designated by such Beneficiary) the number of Polar Shares or
Polar Preferred Shares issuable in connection with the exercise of the Exchange
Right, and, on the applicable payment date, cheques for the balance, if any, of
the total purchase price therefor without interest (but less any amounts
withheld pursuant to Section 3.12); provided, however, that no such delivery
shall be made unless and until the Beneficiary requesting the same shall have
paid (or provided evidence satisfactory to the Trustee, Polar and New Polar of
the payment of) the taxes (if any) payable as contemplated by Section 3.7 of
this Agreement. Immediately upon the giving of notice by the Trustee to Polar
and New Polar of the exercise of the Exchange Right as provided in this Section
3.5, the closing of the transaction of purchase and sale contemplated by the
Exchange Right shall be deemed to have occurred and the holder of such Class A
Exchangeable Shares or Class B Exchangeable Shares shall be deemed to have
transferred to Polar all of such holder’s right, title and interest in and to
such Class A Exchangeable Shares or Class B Exchangeable Shares, as applicable,
and the related interest in the Trust Estate and shall cease to be a holder of
such Class A Exchangeable Shares or Class B Exchangeable Shares and shall not be
entitled to exercise any of the rights of a holder in respect thereof other than
the right to receive his proportionate part of the total purchase price therefor
unless the requisite number of Polar Shares or Polar Preferred Shares is not
allotted, issued and delivered by Polar to the Trustee within 5 Business Days of
the date of the giving of such notice by the Trustee in which case the rights of
the Beneficiary shall remain unaffected until such Polar Shares or Polar
Preferred Shares are so allotted, issued and delivered by Polar. Upon delivery
by Polar to the Trustee of such Polar Shares or Polar Preferred Shares, the
Trustee shall deliver such Polar Shares or Polar Preferred Shares to such
Beneficiary (or to such other persons, if any, properly designated by such
Beneficiary). Concurrently with such Beneficiary ceasing to be a holder of Class
A Exchangeable Shares or Class B Exchangeable Shares, the Beneficiary (or such
other person, if any, properly designated by such Beneficiary) shall be
considered and deemed for all purposes to be the holder of the Polar Shares or
Polar Preferred Shares delivered to it pursuant to the Exchange Right.
 
3.6  
Exercise of Exchange Right Subsequent to Retraction

 
In the event that a Beneficiary has exercised its right under Article V.6 or
Article VI.6 of the Exchangeable Share Provisions to require New Polar to redeem
any or all of the Class A Exchangeable Shares or Class B Exchangeable Shares
held by the Beneficiary (the “Retracted Shares”) and is notified by New Polar
pursuant to Section V.6.6 or VI.6.6 of the Exchangeable Share Provisions that
New Polar will not be permitted as a result of solvency requirements of
applicable law to redeem all such Retracted Shares, and provided that Callco
shall not have exercised the Retraction Call Right with respect to the Retracted
Shares and that the Beneficiary has not revoked the retraction request delivered
by the Beneficiary to New Polar pursuant to Section V.6.1 or VI.6.1 of the
Exchangeable Share Provisions, and provided further that the Trustee has
received a written notice of same from Polar or New Polar, the retraction
request will constitute and will be deemed to constitute notice from the
Beneficiary to the Trustee instructing the Trustee to exercise the Exchange
Right with respect to those Retracted Shares that New Polar is unable to redeem.
In any such event, New Polar hereby agrees with the Trustee and in favour of the
Beneficiary promptly to forward or cause to be forwarded to the Trustee all
relevant materials delivered by the Beneficiary to New Polar or to the transfer
agent of the Class A Exchangeable Shares or Class B Exchangeable Shares
(including, without limitation, a copy of the retraction request delivered
pursuant to Section V.6.1 or VI.6.1 of the Exchangeable Share Provisions, as the
case may be) in connection with such proposed redemption of the Retracted Shares
and the Trustee will thereupon exercise the Exchange Right with respect to the
Retracted Shares that New Polar is not permitted to redeem and will require
Polar to purchase such shares in accordance with the provisions of this Article
3.
 
 
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3.7  
Stamp or Other Transfer Taxes

 
Upon any sale of Class A Exchangeable Shares or Class B Exchangeable Shares to
Polar pursuant to the Exchange Right or the Automatic Exchange Right, the share
certificate or certificates representing Polar Shares or Polar Preferred Shares,
as applicable, to be delivered in connection with the payment of the total
purchase price therefor shall be issued in the name of the Beneficiary of the
Class A Exchangeable Shares or Class B Exchangeable Shares so sold or in such
names as such Beneficiary may otherwise direct in writing without charge to the
holder of the Class A Exchangeable Shares or Class B Exchangeable Shares so
sold; provided, however, that such Beneficiary: (a) shall pay (and none of
Polar, New Polar or the Trustee shall be required to pay) any documentary,
stamp, transfer or other taxes that may be payable in respect of any transfer
involved in the issuance or delivery of such shares to a person other than such
Beneficiary; and (b) shall have evidenced to the satisfaction of the Trustee,
Polar and New Polar that such taxes, if any, have been paid.
 
3.8  
Notice of Insolvency Event

 
As soon as practicable following the occurrence of an Insolvency Event or any
event that with the giving of notice or the passage of time or both would be an
Insolvency Event, Polar and New Polar shall give written notice thereof to the
Trustee. As soon as practicable following the receipt of notice from Polar and
New Polar of the occurrence of an Insolvency Event or upon the Trustee becoming
aware of an Insolvency Event, the Trustee will mail to each Beneficiary, at the
expense of Polar, a notice of such Insolvency Event to be provided by Polar
which notice shall contain a brief statement of the rights of the Beneficiaries
with respect to the Exchange Right.
 
3.9  
Listing/Quotation of Polar Shares

 
Polar will in good faith, using its commercially reasonable efforts,
expeditiously take all such actions and do all such things as are reasonably
necessary or desirable to cause all Polar Shares to be delivered pursuant to the
Exchange Right or the Automatic Exchange Right to be listed, quoted or posted
for trading on all stock exchanges and quotation systems on which outstanding
Polar Shares are listed or quoted at such time.
 
3.10  
Polar Shares and Polar Preferred Shares

 
Polar hereby represents, warrants and covenants that the Polar Shares and Polar
Preferred Shares issuable as described herein will be duly authorized, validly
issued and, upon issuance pursuant to this Agreement, fully paid and
non-assessable and, to Polar’s knowledge, shall be free and clear of any lien,
claim or encumbrance.
 
 
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3.11  
Automatic Exchange on Liquidation of Polar

 
(a)  
Polar will give the Trustee written notice of each of the following events at
the time set forth below:

 
(i)  
in the event of any determination by the board of directors of Polar to
institute voluntary liquidation, dissolution or winding-up proceedings with
respect to Polar or to effect any other distribution of assets of Polar among
its stockholders for the purpose of winding up its affairs, at least 60 days
prior to the proposed effective date of such liquidation, dissolution,
winding-up or other distribution; and

 
(ii)  
as soon as practicable following the earlier of: (A) receipt by Polar of notice
of; and (B) Polar otherwise becoming aware of, any threatened or instituted
claim, suit, petition or other proceedings with respect to the involuntary
liquidation, dissolution or winding-up of Polar or to effect any other
distribution of assets of Polar among its stockholders for the purpose of
winding up its affairs, in each case where Polar has failed to contest in good
faith any such proceeding commenced in respect of Polar within 30 days of
becoming aware thereof.

 
(b)  
As soon as practicable following receipt by the Trustee from Polar of notice of
any event (a “Polar Liquidation Event”) contemplated by Section 3.11(a)(i) or
3.11(a)(ii)above, the Trustee will give notice thereof to the Beneficiaries.
Such notice shall be provided to the Trustee by Polar and shall include a brief
description of the automatic exchange of Class A Exchangeable Shares and Class B
Exchangeable Shares for Polar Shares and Polar Preferred Shares, respectively,
provided for in Section 3.11(c).

 
(c)  
In order that the Beneficiaries will be able to participate on a pro rata basis
with the holders of Polar Shares in the distribution of assets of Polar in
connection with a Polar Liquidation Event, on the fifth Business Day prior to
the effective date (the “Polar Liquidation Event Effective Date”) of a Polar
Liquidation Event all of the then outstanding Class A Exchangeable Shares shall
be automatically exchanged for Polar Shares and all of the then outstanding
Class B Exchangeable Shares shall be automatically exchanged for Polar Preferred
Shares. To effect such automatic exchange, Polar shall purchase on the fifth
Business Day prior to the Polar Liquidation Event Effective Date each Class A
Exchangeable Share then outstanding and held by Beneficiaries, and each
Beneficiary shall sell the Class A Exchangeable Shares held by it at such time,
for a purchase price per share equal to: (a) the Current Market Price of a Polar
Share on the fifth Business Day prior to the Polar Liquidation Event Effective
Date, which shall be satisfied in full by Polar issuing to the Beneficiary one
Polar Share, and (b) to the extent not paid by New Polar, an additional amount
equivalent to the full amount of all declared and unpaid dividends on each such
Class A Exchangeable Share held by such holder on any dividend record date which
occurred prior to the date of the exchange (less any applicable withholding
taxes). To effect such automatic exchange, Polar shall purchase on the fifth
Business Day prior to the Polar Liquidation Event Effective Date each Class B
Exchangeable Share then outstanding and held by Beneficiaries, and each
Beneficiary shall sell the Class B Exchangeable Shares held by it at such time,
for a purchase price per share equal to: (a) the Current Market Price of a Polar
Preferred Share on the fifth Business Day prior to the Polar Liquidation Event
Effective Date, which shall be satisfied in full by Polar issuing to the
Beneficiary one Polar Preferred Share, and (b) to the extent not paid by New
Polar, an additional amount equivalent to the full amount of all declared and
unpaid dividends on each such Class B Exchangeable Share held by such holder on
any dividend record date which occurred prior to the date of the exchange (less
any applicable withholding taxes). Polar shall provide the Trustee with an
Officer’s Certificate in connection with each automatic exchange setting forth
the calculation of the purchase price for each Class A Exchangeable Share and
Class B Exchangeable Share.

 
 
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(d)  
On the fifth Business Day prior to the Polar Liquidation Event Effective Date,
the closing of the transaction of purchase and sale contemplated by the
automatic exchange of Class A Exchangeable Shares for Polar Shares and Class B
Exchangeable Shares for Polar Preferred Shares shall be deemed to have occurred,
and each Beneficiary shall be deemed to have transferred to Polar all of the
Beneficiary’s right, title and interest in and to such Beneficiary’s Class A
Exchangeable Shares and/or Class B Exchangeable Shares and the related interest
in the Trust Estate and shall cease to be a holder of such Class A Exchangeable
Shares and Class B Exchangeable Shares, as applicable, and Polar shall issue to
the Beneficiary the Polar Shares or Polar Preferred Shares issuable upon the
automatic exchange of such Class A Exchangeable Shares or Class B Exchangeable
Shares and on the applicable payment date shall deliver to the Trustee for
delivery to the Beneficiary a cheque in the amount of such dividends, if any,
without interest but less any amounts withheld pursuant to Section 3.12.
Concurrently with such Beneficiary ceasing to be a holder of Class A
Exchangeable Shares or Class B Exchangeable Shares, the Beneficiary shall be
considered and deemed for all purposes to be the holder of the Polar Shares or
Polar Preferred Shares, as applicable, issued pursuant to the automatic exchange
of Class A Exchangeable Shares or Class B Exchangeable Shares and the
certificates held by the Beneficiary previously representing the Class A
Exchangeable Shares and/or Class B Exchangeable Shares exchanged by the
Beneficiary with Polar pursuant to such automatic exchange shall thereafter be
deemed to represent Polar Shares or Polar Preferred Shares, as applicable,
issued to the Beneficiary by Polar pursuant to such automatic exchange. Upon the
request of a Beneficiary and the surrender by the Beneficiary of Class A
Exchangeable Share certificates deemed to represent Polar Shares, duly endorsed
in blank and accompanied by such instruments of transfer as Polar may reasonably
require, Polar shall deliver or cause to be delivered to the Beneficiary
certificates representing Polar Shares of which the Beneficiary is the holder.
Upon the request of a Beneficiary and the surrender by the Beneficiary of Class
B Exchangeable Share certificates deemed to represent Polar Preferred Shares,
duly endorsed in blank and accompanied by such instruments of transfer as Polar
may reasonably require, Polar shall deliver or cause to be delivered to the
Beneficiary certificates representing Polar Preferred Shares of which the
Beneficiary is the holder.

 
3.12  
Withholding Rights

 
Polar, New Polar and the Trustee shall be entitled to deduct and withhold from
any consideration otherwise payable under this Agreement to any holder of Class
A Exchangeable Shares or Polar Shares such amounts as Polar, New Polar or the
Trustee is required or permitted to deduct and withhold with respect to such
payment under the Income Tax Act (Canada), or any provision of provincial, local
or foreign tax law, in each case as amended or succeeded or would be permitted
to withhold if an equal amount were remitted to the appropriate taxing
authority. The Trustee may act on the advice of counsel with respect to such
matters. To the extent that amounts are so withheld, such withheld amounts shall
be treated for all purposes as having been paid to the holder of the shares in
respect of which such deduction and withholding was made, provided that such
withheld amounts (or equivalent amounts, if applicable) are actually remitted to
the appropriate taxing authority. To the extent that the amount so required or
permitted or which would be permitted to be deducted or withheld from any
payment to a holder exceeds the cash portion of the consideration otherwise
payable to the holder, Polar, New Polar and the Trustee are hereby authorized to
sell or otherwise dispose of such portion of the consideration as is necessary
to provide sufficient funds to Polar, New Polar or the Trustee, as the case may
be, to enable it to comply with such deduction or withholding requirement and
Polar, New Polar or the Trustee shall notify the holder thereof and remit to
such holder any unapplied balance of the net proceeds of such sale. Polar
represents and warrants that, based upon facts currently known to it, it has no
current intention, as at the date of this Agreement, to deduct or withhold from
any dividend paid to holders of Class A Exchangeable Shares any amounts under
any applicable taxing legislation.
 
 
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ARTICLE 4
CONCERNING THE TRUSTEE
 
4.1  
Powers and Duties of the Trustee

 
The rights, powers, duties and authorities of the Trustee under this Agreement,
in its capacity as Trustee of the Trust, shall include:
 
(a)  
receiving the grant of the Exchange Right and the Automatic Exchange Right from
Polar as Trustee for and on behalf of the Beneficiaries in accordance with the
provisions of this Agreement;

 
(b)  
exercising the Exchange Right and enforcing the benefit of the Automatic
Exchange Right in each case in accordance with the provisions of this Agreement,
and in connection therewith receiving from Beneficiaries Class A Exchangeable
Shares and other requisite documents and distributing to such Beneficiaries
Polar Shares and cheques, if any, to which such Beneficiaries are entitled upon
the exercise of the Exchange Right or pursuant to the Automatic Exchange Right,
as the case may be;

 
(c)  
holding title to the Trust Estate;

 
(d)  
investing any moneys forming, from time to time, a part of the Trust Estate as
provided in this Agreement;

 
(e)  
taking action on its own initiative or at the direction of a Beneficiary or
Beneficiaries to enforce the obligations of Polar and New Polar under this
Agreement; and

 
(f)  
taking such other actions and doing such other things as are specifically
provided in this Agreement.

 
In the exercise of such rights, powers, duties and authorities the Trustee shall
have (and is granted) such incidental and additional rights, powers and
authorities not in conflict with any of the provisions of this Agreement as the
Trustee, acting in good faith and in the reasonable exercise of its discretion,
may deem necessary, appropriate or desirable to effect the purpose of the Trust.
Any exercise of such discretionary rights, powers, duties and authorities by the
Trustee shall be final, conclusive and binding upon all persons. For greater
certainty, the Trustee shall have only those duties as are specifically set out
in this Agreement.
 
The Trustee in exercising its rights, powers, duties and authorities hereunder
shall act honestly and in good faith and with a view to the best interests of
the Beneficiaries and shall exercise the care, diligence and skill that a
reasonably prudent trustee would exercise in comparable circumstances.
 
The Trustee shall not be bound to give notice or do or take any act, action or
proceeding by virtue of the powers conferred on it hereby unless and until it
shall be specifically required to do so under the terms hereof; nor shall the
Trustee be required to take any notice of, or to do, or to take any act, action
or proceeding as a result of any default or breach of any provision hereunder,
unless and until notified in writing of such default or breach which notices
shall distinctly specify the default or breach desired to be brought to the
attention of the Trustee, and in the absence of such notice the Trustee may for
all purposes of this Agreement conclusively assume that no default or breach has
been made in the observance or performance of any of the representations,
warranties, covenants, agreements or conditions contained herein.
 
 
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4.2  
No Conflict of Interest

 
The Trustee represents to Polar and New Polar that at the date of execution and
delivery of this Agreement there exists no material conflict of interest in the
role of the Trustee as a fiduciary hereunder and the role of the Trustee in any
other capacity. The Trustee shall, within 90 days after it becomes aware that
such material conflict of interest exists, either eliminate such material
conflict of interest or resign in the manner and with the effect specified in
Article 7. If, notwithstanding the foregoing provisions of this Section 4.2, the
Trustee has such a material conflict of interest, the validity and
enforceability of this Agreement shall not be affected in any manner whatsoever
by reason only of the existence of such material conflict of interest. If the
Trustee contravenes the foregoing provisions of this Section 4.2, any interested
party may apply to the Court for an order that the Trustee be replaced as
Trustee hereunder.
 
4.3  
Dealings with Transfer Agents, Registrars, etc.

 
Polar and New Polar irrevocably authorize the Trustee, from time to time, to:
 
(a)  
consult, communicate and otherwise deal with the respective registrars and
transfer agents, and with any such subsequent registrar or transfer agent, of
the Class A Exchangeable Shares and Polar Shares; and

 
(b)  
requisition, from time to time: (i) from any such registrars or transfer agents
any information readily available from the records maintained by it which the
Trustee may reasonably require for the discharge of its duties and
responsibilities under this Agreement; and (ii) from the Canadian transfer agent
of the Polar Shares, and any subsequent transfer agent of such shares, the share
certificates issuable upon the exercise from time to time of the Exchange Right
and pursuant to the Automatic Exchange Right.

 
Polar and New Polar irrevocably authorize their respective registrars and
transfer agents to comply with all such requests. Polar covenants that it will
supply its Canadian transfer agent with duly executed share certificates for the
purpose of completing the exercise from time to time of the Exchange Right and
the Automatic Exchange Right.
 
4.4  
Books and Records

 
The Trustee shall keep available for inspection by Polar and New Polar at the
Trustee’s principal office in Toronto, Ontario correct and complete books and
records of account relating to the Trust created by this Agreement, including,
without limitation, all relevant data relating to mailings and instructions to
and from Beneficiaries and all transactions pursuant to the Exchange Right and
the Automatic Exchange Right.
 
4.5  
Income Tax Returns and Reports

 
The Trustee shall, to the extent necessary, prepare and file on behalf of the
Trust appropriate Canadian income tax returns and any other returns or reports
as may be required by applicable law or pursuant to the rules and regulations of
any securities exchange or other trading system through which the Class A
Exchangeable Shares are traded. In connection therewith, the Trustee may obtain
the advice and assistance of such experts or advisors as the Trustee considers
necessary or advisable (who may be experts or advisors to Polar or New Polar).
Polar or New Polar shall retain qualified experts or advisors for the purpose of
providing such tax advice or assistance. Such qualified experts and advisors
shall be responsible for preparing and distributing to each Beneficiary all
necessary forms for such Beneficiaries to complete their Canadian income tax
returns.
 
 
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4.6  
Indemnification Prior to Certain Actions by Trustee

 
The Trustee shall exercise any or all of the rights, duties, powers or
authorities vested in it by this Agreement at the request, order or direction of
any Beneficiary upon such Beneficiary furnishing to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which may be
incurred by the Trustee therein or thereby, and, if so requested by the Trustee,
sufficient funds to cover the costs, expenses and liabilities which may be
incurred by the Trustee, provided that no Beneficiary shall be obligated to
furnish to the Trustee any such security or indemnity in connection with the
exercise by the Trustee of any of its rights, duties, powers and authorities
with respect to the Exchange Right pursuant to Article 3, subject to Section
4.13, and with respect to the Automatic Exchange Right pursuant to Article 3.
 
None of the provisions contained in this Agreement shall require the Trustee to
expend or risk its own funds or otherwise incur financial liability in the
exercise of any of its rights, powers, duties, or authorities unless funded,
given security and indemnified as aforesaid.
 
4.7  
Action of Beneficiaries

 
No Beneficiary shall have the right to institute any action, suit or proceeding
or to exercise any other remedy authorized by this Agreement for the purpose of
enforcing any of its rights or for the execution of any trust or power hereunder
unless the Beneficiary has requested the Trustee to take or institute such
action, suit or proceeding and furnished the Trustee with the security or
indemnity referred to in Section 4.6 and, if so requested by the Trustee,
sufficient funds to cover the costs, expenses and liabilities which may be
incurred by the Trustee, and the Trustee shall have failed to act within a
reasonable time thereafter. In such case, but not otherwise, the Beneficiary
shall be entitled to take proceedings in any court of competent jurisdiction
such as the Trustee might have taken; it being understood and intended that no
one or more Beneficiaries shall have any right in any manner whatsoever to
affect, disturb or prejudice the rights hereby created by any such action, or to
enforce any right hereunder or the Exchange Right or the Automatic Exchange
Right except subject to the conditions and in the manner herein provided and
that all powers and trusts hereunder shall be exercised and all proceedings at
law shall be instituted, had and maintained by the Trustee, except only as
herein provided, and in any event for the equal benefit of all Beneficiaries.
 
4.8  
Reliance Upon Declaration

 
The Trustee shall not be considered to be in contravention of any of its rights,
powers, duties and authorities hereunder if, when required, it acts and relies
in good faith upon statutory declarations, certificates, opinions or reports
furnished pursuant to the provisions hereof or required by the Trustee to be
furnished to it in the exercise of its rights, powers, duties and authorities
hereunder if such statutory declarations, certificates, opinions or reports
comply with the provisions of Section 4.9, if applicable, and with any other
applicable provisions of this Agreement.
 
4.9  
Evidence and Authority to Trustee

 
Polar and/or New Polar shall furnish to the Trustee evidence of compliance with
the conditions provided for in this Agreement relating to any action or step
required or permitted to be taken by Polar and/or New Polar or the Trustee under
this Agreement or as a result of any obligation imposed under this Agreement,
including, without limitation, in respect of the Exchange Right or the Automatic
Exchange Right and the taking of any other action to be taken by the Trustee at
the request of or on the application of Polar and/or New Polar promptly if and
when:
 
 
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(a)  
such evidence is required by any other Section of this Agreement to be furnished
to the Trustee in accordance with the terms of this Section 4.9; or

 
(b)  
the Trustee, in the exercise of its rights, powers, duties and authorities under
this Agreement, gives Polar and/or New Polar written notice requiring it to
furnish such evidence in relation to any particular action or obligation
specified in such notice.

 
Such evidence shall consist of an Officer’s Certificate of Polar and/or New
Polar or a statutory declaration or a certificate made by persons entitled to
sign an Officer’s Certificate stating that any such condition has been complied
with in accordance with the terms of this Agreement.
 
Whenever such evidence relates to a matter other than the Exchange Right or the
Automatic Exchange Right or the taking of any other action to be taken by the
Trustee at the request or on the application of Polar and/or New Polar, and
except as otherwise specifically provided herein, such evidence may consist of a
report or opinion of any solicitor, attorney, auditor, accountant, appraiser,
valuer, engineer or other expert or any other Person whose qualifications give
authority to a statement made by him provided that if such report or opinion is
furnished by a director, officer or employee of Polar and/or New Polar it shall
be in the form of an Officer’s Certificate or a statutory declaration.
 
Each statutory declaration, Officer’s Certificate, opinion or report furnished
to the Trustee as evidence of compliance with a condition provided for in this
Agreement shall include a statement by the Person giving the evidence:
 
(a)  
declaring that he has read and understands the provisions of this Agreement
relating to the condition in question;

 
(b)  
describing the nature and scope of the examination or investigation upon which
he based the statutory declaration, certificate, statement or opinion; and

 
(c)  
declaring that he has made such examination or investigation as he believes is
necessary to enable him to make the statements or give the opinions contained or
expressed therein.

 
4.10  
Experts, Advisers and Agents

 
The Trustee may:
 
(a)  
in the discharge of its powers and duties and the determination of its rights
hereunder rely on the opinion or advice of or information obtained from any duly
qualified and licensed solicitor, attorney, auditor, accountant, appraiser,
valuer, engineer or other expert, whether retained by the Trustee or by Polar
and/or New Polar or otherwise, (and may employ such assistants not regularly in
the employ of the Trustee as may be necessary to the proper discharge of its
powers and duties and determination of its rights hereunder) the reasonable and
proper costs of which shall be borne by Polar and New Polar jointly and
severally; and

 
(b)  
employ such agents and other assistants not regularly in the employ of the
Trustee as it may reasonably require for the proper discharge of its powers and
duties hereunder the reasonable and proper costs of which shall be borne by
Polar and New Polar jointly and severally.

 
 
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4.11  
Trustee Not Required to Give Security

 
The Trustee shall not be required to give any bond or security in respect of the
execution of the trusts, rights, duties, powers and authorities of this
Agreement or otherwise.
 
4.12  
Trustee Not Bound to Act on Request

 
Except as in this Agreement otherwise specifically provided, the Trustee shall
not be bound to act in accordance with any direction or request of Polar and/or
New Polar or of the directors thereof until a duly authenticated copy of the
instrument or resolution containing such direction or request shall have been
delivered to the Trustee and the Trustee shall be empowered to act upon any such
copy purporting to be authenticated and believed by the Trustee to be genuine.
 
4.13  
Conflicting Claims

 
If conflicting claims or demands are made or asserted with respect to any
interest of any Beneficiary in any Class A Exchangeable Shares, including any
disagreement between the heirs, representatives, successors or assigns
succeeding to all or any part of the interest of any Beneficiary in any Class A
Exchangeable Shares, resulting in conflicting claims or demands being made in
connection with such interest, then the Trustee shall be entitled, at its sole
discretion, to refuse to recognize or to comply with any such claims or demands.
In so refusing, the Trustee may elect not to exercise any Exchange Right or
Automatic Exchange Right subject to such conflicting claims or demands and, in
so doing, the Trustee shall not be or become liable to any Person on account of
such election or its failure or refusal to comply with any such conflicting
claims or demands. The Trustee shall be entitled to continue to refrain from
acting and to refuse to act until:
 
(a)  
the rights of all adverse claimants with respect to the Exchange Right or
Automatic Exchange Right subject to such conflicting claims or demands have been
adjudicated by a final judgment of a court of competent jurisdiction; or

 
(b)  
all differences with respect to the Exchange Right or Automatic Exchange Right
subject to such conflicting claims or demands have been conclusively settled by
a valid written agreement binding on all such adverse claimants, and the Trustee
shall have been furnished with an executed copy of such agreement certified to
be in full force and effect.

 
If the Trustee elects to recognize any claim or comply with any demand made by
any such adverse claimant, it may in its discretion require such claimant to
furnish such surety bond or other security satisfactory to the Trustee as it
shall deem appropriate to fully indemnify it as between all conflicting claims
or demands.
 
4.14  
Acceptance of Trust

 
The Trustee hereby accepts the Trust created and provided for by and in this
Agreement and agrees to perform the same upon the terms and conditions herein
set forth and to hold all rights, privileges and benefits conferred hereby and
by law in trust for the various persons who shall from time to time be
Beneficiaries, subject to all the terms and conditions herein set forth.
 
 
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ARTICLE 5
COMPENSATION
 
5.1  
Fees and Expenses of the Trustee

 
Polar and New Polar jointly and severally agree to pay the Trustee reasonable
compensation for all of the services rendered by it under this Agreement and
will reimburse the Trustee for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in the administration of the trusts
created hereby (including taxes other than taxes based on the net income of the
Trustee) and including the reasonable compensation and disbursements of counsel
and all other assistants or advisors not regularly in its employ, and further
including reasonable fees and expenses for attendance at any meeting of
stockholders, if so requested by Polar or New Polar and disbursements, including
the cost and expense of any suit or litigation of any character and any
proceedings before any governmental agency reasonably incurred by the Trustee in
connection with its duties under this Agreement; provided that Polar and New
Polar shall have no obligation to reimburse the Trustee for any expenses or
disbursements paid, incurred or suffered by the Trustee in any suit or
litigation in which the Trustee is determined to have acted in bad faith or with
negligence, recklessness or wilful misconduct. The Trustee shall be obliged to
provide only one account or invoice to New Polar from time to time in connection
with its appointment hereunder.
 
 
ARTICLE 6
INDEMNIFICATION AND LIMITATION OF LIABILITY
 
6.1  
Indemnification of the Trustee

 
Polar and New Polar jointly and severally agree to indemnify and hold harmless
the Trustee and each of its directors, officers, employees and agents appointed
and acting in accordance with this Agreement (collectively, the “Indemnified
Parties”) against all claims, losses, damages, reasonable costs, penalties,
fines and reasonable expenses (including reasonable expenses of the Trustee’s
legal counsel) which, without fraud, negligence, recklessness, wilful misconduct
or bad faith on the part of such Indemnified Party, may be paid incurred or
suffered by the Indemnified Party by reason or as a result of the Trustee’s
acceptance or administration of the Trust, its compliance with its duties set
forth in this Agreement, or any written or oral instruction delivered to the
Trustee by Polar or New Polar pursuant hereto. This indemnity shall survive the
resignation or removal of the Trustee and the termination of the trusts created
hereby.
 
In no case shall Polar or New Polar be liable under this indemnity for any claim
against any of the Indemnified Parties unless Polar and New Polar shall be
notified by the Trustee of the written assertion of a claim or of any action
commenced against the Indemnified Parties, promptly after any of the Indemnified
Parties shall have received any such written assertion of a claim or shall have
been served with a summons or other first legal process giving information as to
the nature and basis of the claim. Subject to (ii) below, Polar and New Polar
shall be entitled to participate at their own expense in the defence and, if
Polar and New Polar so elect at any time after receipt of such notice, either of
them may assume the defence of any suit brought to enforce any such claim. The
Trustee shall have the right to employ separate counsel in any such suit and
participate in the defence thereof but the fees and expenses of such counsel
shall be at the expense of the Trustee unless: (i) the employment of such
counsel has been authorized by Polar or New Polar; or (ii) the named parties to
any such suit include both the Trustee and Polar or New Polar and the Trustee
shall have been advised by counsel acceptable to Polar or New Polar that there
may be one or more legal defences available to the Trustee that are different
from or in addition to those available to Polar or New Polar and that, in the
judgment of such counsel, would present a conflict of interest were a joint
representation to be undertaken (in which case Polar and New Polar shall not
have the right to assume the defence of such suit on behalf of the Trustee but
shall be liable to pay the reasonable fees and expenses of counsel for the
Trustee). Neither Polar nor New Polar shall be liable for any settlement
effected without its written consent.
 
6.2  
Limitation of Liability

 
The Trustee shall not be held liable for any loss which may occur by reason of
depreciation of the value of any part of the Trust Estate or any loss incurred
on any investment of funds pursuant to this Agreement, except to the extent that
such loss is attributable to the fraud, negligence, recklessness, wilful
misconduct or bad faith on the part of the Trustee.
 
 
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ARTICLE 7
CHANGE OF TRUSTEE
 
7.1  
Resignation

 
The Trustee, or any trustee hereafter appointed, may at any time resign by
giving written notice of such resignation to Polar and New Polar specifying the
date on which it desires to resign, provided that such notice shall not be given
less than one month before such desired resignation date unless Polar and New
Polar otherwise agree and provided further that such resignation shall not take
effect until the date of the appointment of a successor trustee and the
acceptance of such appointment by the successor trustee. Upon receiving such
notice of resignation, Polar and New Polar shall promptly appoint a successor
trustee which shall be a corporation organized and existing under the laws of
Canada and authorized to carry on the business necessary to fulfill the rights,
obligations and duties of a trustee pursuant to this Agreement in all provinces
of Canada, by written instrument in duplicate, one copy of which shall be
delivered to the resigning trustee and one copy to the successor trustee.
 
Failing the appointment by Polar and New Polar of a successor trustee as
aforesaid and the acceptance of such appointment by a successor trustee, a
successor trustee may be appointed by order of a court of competent jurisdiction
in the Province of Ontario upon application of one or more of the parties to
this Agreement. If the retiring trustee is the party initiating an application
for the appointment of a successor trustee by order of a court of competent
jurisdiction, Polar and New Polar shall be jointly and severally liable to
reimburse the retiring trustee for its legal costs and expenses in connection
with same.
 
7.2  
Removal

 
The Trustee, or any trustee hereafter appointed may (provided a successor
trustee is appointed) be removed at any time on not less than 30 days’ prior
notice by written instrument executed by Polar and New Polar, in duplicate, one
copy of which shall be delivered to the trustee so removed and one copy to the
successor trustee.
 
7.3  
Successor Trustee

 
Any successor trustee appointed as provided under this Agreement shall execute,
acknowledge and deliver to Polar and New Polar and to its predecessor trustee an
instrument accepting such appointment. Thereupon, the resignation or removal of
the predecessor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, duties and obligations of its predecessor under this Agreement,
with the like effect as if originally named as trustee in this Agreement.
However, on the written request of Polar and New Polar or of the successor
trustee, the trustee ceasing to act shall, upon payment of any amounts then due
it pursuant to the provisions of this Agreement, execute and deliver an
instrument transferring to such successor trustee all the rights and powers of
the trustee so ceasing to act. Upon the request of any such successor trustee,
Polar, New Polar and such predecessor trustee shall execute any and all
instruments in writing for more fully and certainly vesting in and confirming to
such successor trustee all such rights and powers.
 
 
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7.4  
Notice of Successor Trustee

 
Upon acceptance of appointment by a successor trustee as provided herein, Polar
and New Polar shall cause to be mailed notice of the succession of such trustee
hereunder to each Beneficiary. If Polar or New Polar shall fail to cause such
notice to be mailed within 10 days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of Polar and New Polar.
 
7.5  
Change of Control of Trustee

 
Any corporation into or with which the Trustee may be merged or consolidated or
amalgamated or any corporation resulting therefrom, or any corporation
succeeding to the trust business of the Trustee shall be the successor to the
Trustee without any further act on its part or any of the parties hereto,
provided that such corporation would be eligible for appointment as a successor
trustee under the provisions of this Agreement.
 
 
ARTICLE 8
POLAR US SUCCESSORS
 
8.1  
Certain Requirements in Respect of Combination, etc.

 
Polar shall not consummate any transaction (whether by way of reconstruction,
reorganization consolidation, merger, transfer, sale, lease or otherwise)
whereby all or substantially all of its undertaking, property and assets would
become the property of any other Person or, in the case of a merger, of the
continuing corporation resulting therefrom unless:
 
(a)  
such other Person or continuing corporation (the “Polar Successor”) by operation
of law becomes without more, bound by the terms and provisions of this Agreement
or, if not so bound executes prior to or contemporaneously with the consummation
of such transaction, an agreement supplemental hereto and such other instruments
(if any) as are satisfactory to the Trustee, acting reasonably, and in the
opinion of legal counsel to the Trustee are reasonably necessary or advisable to
evidence the assumption by the Polar Successor of liability for all moneys
payable and property deliverable hereunder and the covenant of such Polar
Successor to pay and deliver or cause to be delivered the same and its agreement
to observe and perform all the covenants and obligations of Polar under this
Agreement; and

 
(b)  
such transaction shall, to the satisfaction of the Trustee, acting reasonably,
and in the opinion of legal counsel to the Trustee, be upon such terms and
conditions as substantially to preserve and not to impair in any material
respect any of the rights, duties, powers and authorities of the Trustee or of
the Beneficiaries.

 
8.2  
Vesting of Powers in Successor

 
Whenever the conditions of Section 8.1 have been duly observed and performed,
the Trustee and, if required by Section 8.1, the Polar Successor and New Polar
shall execute and deliver the supplemental agreement provided for in Article 9
and thereupon the Polar Successor shall possess and from time to time may
exercise each and every right and power of Polar under this Agreement in the
name of Polar or otherwise and any act or proceeding by any provision of this
Agreement required to be done or performed by the board of directors of Polar or
any officers of Polar may be done and performed with like force and effect by
the directors or officers of such Polar Successor.
 
8.3  
Wholly-Owned Subsidiaries

 
Nothing herein shall be construed as preventing the amalgamation or merger of
any wholly-owned direct or indirect subsidiary of Polar with or into Polar or
the winding-up, liquidation or dissolution of any wholly-owned subsidiary of
Polar provided that all of the assets of such subsidiary are transferred to
Polar or another wholly-owned direct or indirect subsidiary of Polar. Any such
transactions are expressly permitted by this Article 8.
 
 
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ARTICLE 9
AMENDMENTS AND SUPPLEMENTAL TRUST AGREEMENTS
 
9.1  
Amendments, Modifications, etc.

 
This Agreement may not be amended or modified except by an agreement in writing
executed by Polar, New Polar and the Trustee and approved by the Beneficiaries
in accordance with Section V.10.2 or VI.10.2 of the Exchangeable Share
Provisions, as the case may be.
 
9.2  
Ministerial Amendments

 
Notwithstanding the provisions of Section 9.1, the parties to this Agreement may
in writing, at any time and from time to time, without the approval of the
Beneficiaries, amend or modify this Agreement for the purposes of:
 
(a)  
adding to the covenants of any or all parties hereto for the protection of the
Beneficiaries hereunder provided that the board of directors of each of Polar
and New Polar shall be of the good faith opinion that such additions will not be
prejudicial to the rights or interests of the Beneficiaries;

 
(b)  
making such amendments or modifications not inconsistent with this Agreement as
may be necessary or desirable with respect to matters or questions which, in the
good faith opinion of the board of directors of each of Polar and New Polar and
in the opinion of the Trustee, having in mind the best interests of the
Beneficiaries, it may be expedient to make, provided that such boards of
directors and the Trustee, acting on advice of legal counsel, shall be of the
opinion that such amendments and modifications will not be prejudicial to the
interests of the Beneficiaries; or

 
(c)  
making such changes or corrections which, on the advice of counsel to Polar, New
Polar and the Trustee, are required for the purpose of curing or correcting any
ambiguity or defect or inconsistent provision or clerical omission or mistake or
manifest error, provided that the Trustee and the board of directors of each of
Polar and New Polar, each acting on advice of legal counsel, shall be of the
opinion that such changes or corrections will not be prejudicial to the rights
and interests of the Beneficiaries.

 
9.3  
Meeting to Consider Amendments

 
New Polar, at the request of Polar, shall call a meeting or meetings of the
Beneficiaries for the purpose of considering any proposed amendment or
modification requiring approval pursuant hereto. Any such meeting or meetings
shall be called and held in accordance with the by-laws of New Polar, the
Exchangeable Share Provisions and all applicable laws.
 
9.4  
Changes in Capital of Polar and New Polar

 
At all times after the occurrence of any event contemplated pursuant to Section
2.7 or 2.8 of the Support Agreement or otherwise, as a result of which either
Polar Shares or the Class A Exchangeable Shares or both are in any way changed,
this Agreement shall forthwith be amended and modified as necessary in order
that it shall apply with full force and effect, mutatis mutandis, to all new
securities into which the Polar Shares or the Class A Exchangeable Shares or
both are so changed and the parties hereto shall execute and deliver a
supplemental agreement giving effect to and evidencing such necessary amendments
and modifications 11.5 Execution of Supplemental Trust Agreements
 
 
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No amendment to or modification or waiver of any of the provisions of this
Agreement otherwise permitted hereunder shall be effective unless made in
writing and signed by all of the parties hereto. From time to time New Polar,
Polar (provided each of New Polar and Polar shall have been authorized by their
respective boards) and the Trustee may, subject to the provisions of this
Agreement and they shall, when so directed by this Agreement, execute and
deliver by their proper officers, agreements or other instruments supplemental
hereto, which thereafter shall form part hereof, for any one or more of the
following purposes,
 
(a)  
evidencing the succession of Polar Successors and the covenants of and
obligations assumed by each such Polar Successor in accordance with the
provisions of Article 8 and the successors of any successor trustee in
accordance with the provisions of Article 7;

 
(b)  
making any additions to, deletions from or alterations of the provisions of this
Agreement or the Exchange Right or the Automatic Exchange Right which, in the
opinion of the Trustee, will not be prejudicial to the interests of the
Beneficiaries or are, in the opinion of counsel to the Trustee, necessary or
advisable in order to incorporate, reflect or comply with any legislation the
provisions of which apply to Polar, New Polar, the Trustee or this Agreement;
and

 
(c)  
for any other purposes not inconsistent with the provisions of this Agreement,
including, without limitation, to make or evidence any amendment or modification
to this Agreement as contemplated hereby, provided that, in the opinion of the
Trustee, the rights of the Trustee and Beneficiaries will not be prejudiced
thereby.

 
 
ARTICLE 10
TERMINATION
 
10.1  
Term

 
The Trust created by this Agreement shall continue until the earliest to occur
of the following events:
 
(a)  
no outstanding Class A Exchangeable Shares are held by a Beneficiary;

 
(b)  
each of Polar and New Polar elects in writing to terminate the Trust and such
termination is approved by the Beneficiaries in accordance with Section V.10.2
or VI.10.2 of the Exchangeable Share Provisions; and

 
(c)  
21 years after the date of this Agreement.

 
10.2  
Survival of Agreement

 
This Agreement shall survive any termination of the Trust and shall continue
until there are no Class A Exchangeable Shares outstanding held by a
Beneficiary; provided, however that the provisions of Article 6 and Article 7
shall survive any such termination of this Agreement.
 
 
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ARTICLE 11
GENERAL
 
11.1  
Severability

 
If any provision of this Agreement is held to be invalid, illegal or
unenforceable, the validity, legality or enforceability of the remainder of this
Agreement shall not in any way be affected or impaired thereby and this
Agreement shall be carried out as nearly as possible in accordance with its
original terms and conditions.
 
11.2  
Enurement

 
This Agreement shall be binding upon and enure to the benefit of the parties
hereto and their respective successors and permitted assigns and to the benefit
of the Beneficiaries.
 
11.3  
Notices to Parties

 
All notices and other communications between the parties hereunder shall be in
writing and shall be deemed to have been given if delivered personally or by
confirmed telecopy to the parties at the following addresses (or at such other
address for such party as shall be specified in like notice):
 
 
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(a)  
if to Polar:
 
100 York Boulevard
Suite 600
Richmond Hill, Ontario
L4B 1J8
Attention:   George Perlin
 
with a copy (which shall not constitute notice) to:
 
Goodmans LLP
Suite 3400
Bay Adelaide Centre
333 Bay Street
Toronto, ON  M5H 2S7
Attention:  Avi S. Greenspoon
Fax:   (416) 979-1234

 
(b)  
if to New Polar
 
100 York Boulevard
Suite 600
Richmond Hill, Ontario
L4B 1J8
Attention: George Perlin

 
(c)  
if to the Trustee:
 
100 York Boulevard
Suite 600
Richmond Hill, Ontario
L4B 1J8
Attention:  George Perlin

 
Any notice or other communication given personally shall be deemed to have been
given and received upon delivery thereof and if given by telecopy shall be
deemed to have been given and received on the date of receipt thereof unless
such day is not a Business Day in which case it shall be deemed to have been
given and received upon the immediately following Business Day.
 
 
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11.4  
Notice to Beneficiaries

 
Any and all notices to be given and any documents to be sent to any
Beneficiaries may be given or sent to the address of such Beneficiary shown on
the register of holders of Class A Exchangeable Shares in any manner permitted
by the bylaws of New Polar from time to time in force in respect of notices to
shareholders (such manner to be confirmed in writing by New Polar to the Trustee
prior to any mailing) and shall be deemed to be received (if given or sent in
such manner) at the time specified in such bylaws, the provisions of which
bylaws shall apply mutatis mutandis to notices or documents as aforesaid sent to
such Beneficiaries.
 
11.5  
Counterparts

 
This Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which taken together shall constitute one and the same
instrument.
 
11.6  
Jurisdiction

 
This Agreement shall be construed and enforced in accordance with the laws of
the Province of Ontario and the federal laws of Canada applicable therein.
 
11.7  
Attornment

 
Each of the Trustee and Polar and New Polar agrees that any action or proceeding
arising out of or relating to this Agreement may be instituted in the courts of
Ontario, waives any objection which it may have now or hereafter to the venue of
any such action or proceeding, irrevocably submits to the jurisdiction of the
said courts in any such action or proceeding, agrees to be bound by any final
judgment of the said court, and not to seek, and hereby waives any review of the
merits of any such judgment by the courts of any other jurisdiction and Polar
hereby appoints New Polar at its registered office in the Province of Ontario as
attorney for service of process.
 
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
 

    POLAR WIRELESS CORP.            
Per:
/s/ George Perlin
     
Name:
Title:
              2240519 ONTARIO LIMITED            
Per:
/s/ Shane G. Carroll
     
Name: Shane G. Carroll
Title: President
              2230354 ONTARIO INC.            
Per:
/s/ Vladimir Aleynikov
     
Name:  Vladimir Aleynikov
Title:  Director
 

 
 
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