exv10w3





EXHIBIT 10.3




SUPPORT AGREEMENT




THIS AGREEMENT is made the 24th day of July, 2008,




B E T W E E N:





NORTH AMERICAN NATURAL GAS, INC., a corporation existing under the laws of the State
of Washington,




(hereinafter referred to as “PureRay U.S.”),




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PURERAY HOLDINGS ULC, an unlimited liability corporation formed under the laws of
the Province of Alberta,




(hereinafter referred to as “PureRay Holdings”),




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PURERAY ACQUISITION INC., a corporation formed under the laws of Canada,




(hereinafter referred to as the “Corporation”)



WHEREAS:





	A.	 	the Corporation is a wholly-owned subsidiary of PureRay Holdings and PureRay Holdings is a
wholly-owned subsidiary of PureRay U.S.;
	 
	B.	 	pursuant to a share purchase agreement dated July 24, 2008 (the “Purchase Agreement”),
between PureRay U.S., PureRay Holdings, the Corporation and all of the shareholders of PureRay
Corporation (“PureRay”), the Corporation has agreed to acquire all of the outstanding shares
in the capital of PureRay and, in satisfaction of payment of the purchase price therefor, to
issue one Exchangeable Share (as hereinafter defined) for each such share of PureRay acquired
by the Corporation;
	 
	C.	 	the articles of the Corporation set forth the rights, privileges, restrictions and conditions
(collectively, the “Exchangeable Share Provisions”) attaching to the Exchangeable Shares; and
	 
	D.	 	the parties desire to make appropriate provision and to establish a procedure whereby PureRay
U.S. and PureRay Holdings will take certain actions and make certain payments and deliveries
necessary to ensure that the Corporation will be able to make certain payments and to deliver
or cause to be delivered PureRay U.S. Common Shares in satisfaction of the obligations of the










 



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	 	 	Corporation under the Exchangeable Share Provisions with respect to the payment and
satisfaction of dividends, Liquidation Amounts, Retraction Prices and Redemption Prices, all
in accordance with the Exchangeable Share Provisions;





NOW THEREFORE in consideration of the respective covenants provided in this Agreement and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:



ARTICLE 1

DEFINITIONS AND INTERPRETATION




1.1 Defined Terms




Each term denoted herein by initial capital letters and not otherwise defined herein shall have the
meaning ascribed thereto in the Exchangeable Share Provisions.



1.2 Interpretation Not Affected by Headings, Etc.




The division of this Agreement into articles, sections and paragraphs and the insertion of headings
are for convenience of reference only and shall not affect the construction or interpretation of
this Agreement.



1.3 Number, Gender, Etc.




Words importing the singular number only shall include the plural and vice versa. Words importing
the use of any gender shall include the feminine and the masculine.



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.



ARTICLE 2

COVENANTS OF PURERAY U.S. AND THE CORPORATION




2.1 Covenants of PureRay U.S. Regarding Exchangeable Shares




So long as any Exchangeable Shares are outstanding, PureRay U.S. shall:




	 	(a)	 	not declare or pay any dividend on the PureRay U.S. Common Shares unless: (i)
the Corporation will have sufficient assets, funds and other property available to
enable the due declaration and the due and punctual payment, in accordance with
applicable law, of an equivalent dividend (as provided for in the Exchangeable Share
Provisions) on the Exchangeable Shares, and (ii) the Corporation shall simultaneously
declare or pay, as the case may be, an equivalent dividend on the Exchangeable Shares,
in each case in accordance with the Exchangeable Share Provisions;
	 
	 	(b)	 	cause the Corporation to declare simultaneously with the declaration of any
dividend on PureRay U.S. Common Shares an equivalent dividend on the Exchangeable
Shares and, when such dividend is paid on the PureRay U.S. Common Shares, cause the
Corporation to pay simultaneously therewith such equivalent dividend on the
Exchangeable Shares, in each case in accordance with the Exchangeable Share Provisions;










 



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	 	(c)	 	advise the Corporation sufficiently in advance of the declaration by PureRay
U.S. of any dividend on the PureRay U.S. Common Shares and take all such other actions
as are necessary, in co-operation with the Corporation, to ensure that the respective
declaration date, record date and payment date for a dividend on the Exchangeable
Shares shall be the same as the record date, declaration date and payment date for the
corresponding dividend on the PureRay U.S. Common Shares and such dividend will
correspond with any requirement of the stock exchange on which the Exchangeable Shares
may be then listed;
	 
	 	(d)	 	ensure that the record date for any dividend declared on PureRay U.S. Common
Shares is not less than 10 days after the declaration date for such dividend;
	 
	 	(e)	 	take all such actions and do all such things as are necessary or desirable to
enable and permit the Corporation, in accordance with applicable law, to pay and
otherwise perform its obligations with respect to the satisfaction of the Liquidation
Amount, the Retraction Price or the Redemption Price in respect of each issued and
outstanding Exchangeable Share upon the liquidation, dissolution or winding-up of the
Corporation, the delivery of a Retraction Request by a holder of Exchangeable Shares or
a redemption of Exchangeable Shares by the Corporation, including, without limitation,
all such actions and all such things as are necessary or desirable to enable and permit
the Corporation to cause PureRay U.S. Common Shares to be allotted to the holders of
Exchangeable Shares in accordance with the provisions of sections 4, 5 or 6, as the
case may be, of the Exchangeable Share Provisions;
	 
	 	(f)	 	take all such actions and do all such things as are reasonably necessary or
desirable to enable and permit PureRay Holdings, in accordance with applicable law, to
perform its obligations arising upon the exercise by it of the Liquidation Call Right,
the Retraction Call Right or the Redemption Call Right, and further including, without
limitation, all such actions and all such things as are necessary or desirable to
enable and permit PureRay Holdings to cause PureRay U.S. Common Shares to be allotted
to the holders of Exchangeable Shares, in accordance with the provisions of the
Liquidation Call Right, the Retraction Call Right or the Redemption Call Right, as the
case may be; and
	 
	 	(g)	 	not exercise its vote as a shareholder, directly or indirectly, to initiate the
voluntary liquidation, dissolution or winding-up of the Corporation nor take any action
or omit to take, directly or indirectly, any action that is designed to result in the
liquidation, dissolution or winding-up of the Corporation.





2.2 Authorization of PureRay U.S. Common Shares




PureRay U.S. hereby represents, warrants and covenants for the benefit of the holders of the
Exchangeable Shares that it has irrevocably reserved for issuance and will at all times while any
Exchangeable Shares (other than Exchangeable Shares held by PureRay U.S. or its Affiliates) are
outstanding, keep available, free from preemptive rights out of its authorized and unissued capital
stock such number of PureRay U.S. Common Shares (or other shares or securities into which PureRay
U.S. Common Shares may be reclassified or changed as contemplated by Section 2.6 hereof): (i) as is
equal to the sum of (A) the number of Exchangeable Shares issued and outstanding from time to time
(other than those Exchangeable Shares that have been acquired by PureRay U.S. or an Affiliate of
PureRay U.S.), and (B) the number of Exchangeable Shares issuable upon the exercise of all rights
to acquire Exchangeable Shares outstanding from time to time; and (ii) as are now and may hereafter
be required to enable and permit the Corporation to meet its obligations hereunder, under the
Voting and Exchange Trust Agreement, under the Exchangeable Share Provisions and under any other
security or commitment









 



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pursuant to which PureRay U.S. may now or hereafter be required to allot PureRay U.S. Common Shares
and to enable and permit PureRay Holdings to exercise and to meet its obligations under the
Liquidation Call Right, the Retraction Call Right and the Redemption Call Right.



2.3 Notification of Certain Events




In order to assist PureRay U.S. in complying with its obligations hereunder and to permit PureRay
Holdings to exercise the Liquidation Call Right, the Retraction Call Right and the Redemption Call
Right, the Corporation shall give PureRay U.S. and PureRay Holdings notice of each of the following
events at the time set forth below:




	 	(a)	 	in the event of any determination by the board of directors of the Corporation
(the “Board of Directors”) to institute voluntary liquidation, dissolution or winding
up proceedings with respect to the Corporation or to effect any other distribution of
the assets of the Corporation among its shareholders 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;
	 
	 	(b)	 	immediately, upon the earlier of receipt by the Corporation of notice of and
the Corporation 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 the Corporation or to effect any other distribution of the assets of
the Corporation among its shareholders for the purpose of winding up its affairs;
	 
	 	(c)	 	immediately, upon receipt by the Corporation of a Retraction Request;
	 
	 	(d)	 	on the same date on which notice of redemption is given to the holders of
Exchangeable Shares, upon the determination of a Redemption Date in accordance with the
Exchangeable Share Provisions; and
	 
	 	(e)	 	as soon as practicable upon the issuance by the Corporation of any Exchangeable
Shares or rights to acquire Exchangeable Shares (other than the issuance of
Exchangeable Shares pursuant to the Purchase Agreement).





2.4 Delivery of PureRay U.S. Common Shares




In furtherance of PureRay U.S.’s obligations under sections 2.1(e) and 2.1(f) hereof, upon notice
from the Corporation or PureRay Holdings of any event that requires any such party to cause PureRay
U.S. Common Shares to be delivered to any holder of Exchangeable Shares, PureRay U.S. shall
forthwith cause the requisite number of PureRay U.S. Common Shares to be allotted to the former
holder of the surrendered Exchangeable Shares, as the Corporation or PureRay Holdings shall direct.
All such PureRay U.S. Common Shares shall be duly issued as fully paid and non-assessable and
shall be free and clear of any lien, claim, encumbrance, security interest or adverse claim.



2.5 Qualification of PureRay U.S. Common Shares




PureRay U.S. covenants that if any PureRay U.S. Common Shares (or other shares or securities into
which PureRay U.S. Common Shares may be reclassified or changed as contemplated by section 2.6
hereof) to be issued and delivered hereunder, including for greater certainty, pursuant to the
Exchangeable Share Provisions, the Exchange Right or the Automatic Exchange Rights (as such terms
are defined in the Voting and Exchange Trust Agreement) require registration or qualification with
or approval of or the filing of any document including any prospectus or similar document or the
taking of any proceeding with









 



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or the obtaining of any order, ruling or consent from any governmental or regulatory authority
under any Canadian or United States federal, state or provincial law or regulation or pursuant to
the rules and regulations of any regulatory authority or stock exchange or quotation system on
which outstanding PureRay U.S. Common Shares are listed, quoted or posted for trading or the
fulfilment of any other legal requirement in Canada or the United States (collectively, the
“Applicable Laws”) before such shares (or other shares or securities into which PureRay U.S. Common
Shares may be reclassified or changed as contemplated by section 2.6 hereof) may be issued and
delivered by PureRay U.S. to the initial holder thereof, PureRay U.S. will in good faith
expeditiously take all such actions and do all such things as are reasonably necessary to cause
such PureRay U.S. Common Shares (or other shares or securities into which PureRay U.S. Common
Shares may be reclassified or changed as contemplated by section 2.6 hereof) to be and remain duly
registered, qualified or approved. PureRay U.S. will in good faith expeditiously take all such
actions and do all such things as are necessary to cause all PureRay U.S. Common Shares (or other
shares or securities into which PureRay U.S. Common Shares may be reclassified or changed as
contemplated by section 2.6 hereof) to be delivered hereunder, including for greater certainty,
pursuant to the Exchangeable Share Provisions, the Exchange Right or the Automatic Exchange Rights
to be listed, quoted or posted for trading on all stock exchanges and quotation systems on which
such shares are listed, quoted or posted for trading at such time.



2.6 Economic Equivalence





	(a)	 	PureRay U.S. will not without the prior approval of the Corporation and the prior approval of
the holders of the Exchangeable Shares given in accordance with section 9 of the Exchangeable
Share Provisions:






	 	(i)	 	issue or distribute PureRay U.S. Common Shares (or securities exchangeable for
or convertible into or carrying rights to acquire PureRay U.S. Common Shares) to the
holders of all or substantially all of the then outstanding PureRay U.S. Common Shares
by way of stock dividend or other distribution, other than an issue of PureRay U.S.
Common Shares (or securities exchangeable for or convertible into or carrying rights to
acquire PureRay U.S. Common Shares) to holders of PureRay U.S. Common Shares who
exercise an option to receive dividends in PureRay U.S. Common Shares (or securities
exchangeable for or convertible into or carrying rights to acquire PureRay U.S. Common
Shares) in lieu of receiving cash dividends; or
	 
	 	(ii)	 	issue or distribute rights, options or warrants to the holders of all or
substantially all of the then outstanding PureRay U.S. Common Shares entitling them to
subscribe for or to purchase PureRay U.S. Common Shares (or securities exchangeable for
or convertible into or carrying rights to acquire PureRay U.S. Common Shares); or
	 
	 	(iii)	 	issue or distribute to the holders of all or substantially all of the then
outstanding PureRay U.S. Common Shares: (A) shares or securities of PureRay U.S. of any
class other than PureRay U.S. Common Shares (other than shares convertible into or
exchangeable for or carrying rights to acquire PureRay U.S. Common Shares), (B) rights,
options or warrants other than those referred to in section 2.6(a)(ii) above, (C)
evidences of indebtedness of PureRay U.S. or (D) assets of PureRay U.S.;






unless on a per share basis of such rights, options, securities, the economic equivalent on
a per share basis of such rights, options, securities, shares, evidences of indebtedness or
other assets to holders of the Exchangeable Shares is issued or distributed simultaneously
to holders of the Exchangeable Shares.









 



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	(b)	 	PureRay U.S. will not, without the prior approval of the Corporation and the prior approval
of the holders of the Exchangeable Shares given in accordance with section 9 of the
Exchangeable Share Provisions:






	 	(i)	 	subdivide, redivide or change the then outstanding PureRay U.S. Common Shares
into a greater number of shares of PureRay U.S. Common Shares; or
	 
	 	(ii)	 	reduce, combine, consolidate or change the then outstanding PureRay U.S. Common
Shares into a lesser number of PureRay U.S. Common Shares; or
	 
	 	(iii)	 	reclassify or otherwise change the PureRay U.S. Common Shares or effect an
amalgamation, merger, reorganization or other transaction affecting the PureRay U.S.
Common Shares;






unless the same or an economically equivalent change to, or in the rights of holders of, the
Exchangeable Shares is simultaneously made to, or in the rights of the holders of, the
Exchangeable Shares.




	(c)	 	PureRay U.S. will ensure that the record date for any event referred to in section 2.6(a) or
2.6(b) above, or (if no record date is applicable for such event) the effective date for any
such event, is not less than 10 Business Days after the date on which such event is declared
or announced by PureRay U.S. (with simultaneous notice thereof to be given by PureRay U.S. to
the Corporation).
	 
	(d)	 	The Board of Directors shall determine, in good faith and in its sole discretion (with the
assistance of such reputable and qualified independent financial advisors and/or other experts
as the Board of Directors may require), economic equivalence for the purposes of any event
referred to in section 2.6(a) or 2.6(b) above and each such determination shall be conclusive
and binding on PureRay U.S. In making each such determination, the following factors shall,
without excluding other factors determined by the Board of Directors to be relevant, be
considered by the Board of Directors:






	 	(i)	 	in the case of any stock dividend or other distribution payable in PureRay U.S.
Common Shares, the number of such shares issued in proportion to the number of PureRay
U.S. Common Shares previously outstanding;
	 
	 	(ii)	 	in the case of the issuance or distribution of any rights, options or warrants
to subscribe for or purchase PureRay U.S. Common Shares (or securities exchangeable for
or convertible into or carrying rights to acquire PureRay U.S. Common Shares), the
relationship between the exercise price of each such right, option or warrant and the
current market value (as determined by the Board of Directors in the manner
contemplated below) of a PureRay U.S. Common Share;
	 
	 	(iii)	 	in the case of the issuance or distribution of any other form of property
(including without limitation any shares or securities of PureRay U.S. of any class
other than PureRay U.S. Common Shares, any rights, options or warrants other than those
referred to in section 2.6(d)(ii) above, any evidences of indebtedness of PureRay U.S.
or any assets of PureRay U.S.), the relationship between the fair market value (as
determined by the Board of Directors in the manner above contemplated) of such property
to be issued or distributed with respect to each outstanding PureRay U.S. Common Share
and the current market value (as determined by the Board of Directors in the manner
contemplated below) of a PureRay U.S. Common Share;










 



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	 	(iv)	 	in the case of any subdivision, redivision or change of the then outstanding
PureRay U.S. Common Shares into a greater number of PureRay U.S. Common Shares or the
reduction, combination or consolidation or change of the then outstanding PureRay U.S.
Common Shares into a lesser number of PureRay U.S. Common Shares or any amalgamation,
merger, reorganization or other transaction affecting PureRay U.S. Common Shares, the
effect thereof upon the then outstanding PureRay U.S. Common Shares; and
	 
	 	(v)	 	in all such cases, the general taxation consequences of the relevant event to
holders of Exchangeable Shares to the extent that such consequences may differ from the
taxation consequences to holders of PureRay U.S. Common Shares as a result of
differences between taxation laws of Canada and the United States (except for any
differing consequences arising as a result of differing marginal taxation rates and
without regard to the individual circumstances of holders of Exchangeable Shares).






For purposes of the foregoing determinations, the current market value of any security
listed and traded or quoted on a securities exchange shall be the weighted average of the
daily prices of such security during a period of not less than 20 consecutive trading days
ending not more than three trading days before the date of determination on the principal
securities exchange on which such securities are listed and traded or quoted; provided,
however, that if the PureRay U.S. Common Shares are not then quoted on any stock exchange or
automated quotation system or if, in the opinion of the Board of Directors the public
distribution or trading activity of such securities during such period does not create a
market that reflects the fair market value of such securities, then the current market value
thereof shall be determined by the Board of Directors, in good faith and in its sole
discretion (with the assistance of such reputable and qualified independent financial
advisors and/or other experts as the board may require), and provided further that any such
determination by the board shall be conclusive and binding on PureRay U.S.




	(e)	 	PureRay Holdings and the Corporation agree that, to the extent required, upon due notice from
PureRay U.S., PureRay Holdings and the Corporation will use their best efforts to take or
cause to be taken such steps as may be necessary for the purposes of ensuring that appropriate
dividends are paid or other distributions are made by the Corporation, or subdivisions,
re-divisions or changes are made to the Exchangeable Shares, in order to implement the
required economic equivalence with respect to the PureRay U.S. Common Shares and Exchangeable
Shares as provided for in this section 2.6.





2.7 Tender Offers, Etc.




In the event that a merger, consolidation or tender offer, share exchange offer, issuer bid,
take-over bid or similar transaction with respect to PureRay U.S. Common Shares (an “Offer”) is
proposed by PureRay U.S. or is proposed to PureRay U.S. or its shareholders and is recommended by
the board of directors of PureRay U.S., or is otherwise effected or to be effected with the consent
or approval of the board of directors of PureRay U.S. and the Exchangeable Shares are not redeemed
by the Corporation or purchased by PureRay Holdings (or PureRay U.S.) pursuant to the Redemption
Call Right, PureRay U.S. will use its reasonable efforts expeditiously and in good faith to take
all such actions and do all such things as are necessary or desirable to enable and permit holders
of Exchangeable Shares to participate in such Offer to the same extent and on an economically
equivalent basis as the holders of PureRay U.S. Common Shares, without discrimination. Without
limiting the generality of the foregoing, PureRay U.S. will use its reasonable efforts
expeditiously and in good faith to ensure that holders of Exchangeable Shares may participate in
all such Offers without being required to retract Exchangeable Shares as against the Corporation
(or, if so required, to ensure that any such retraction shall be effective only upon, and shall be
conditional upon, the closing of the Offer and only to the extent necessary to tender or deposit to
the Offer). Nothing herein shall affect the rights of the Corporation to redeem (or PureRay
Holdings or









 



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PureRay U.S.) to purchase pursuant to the Redemption Call Right, Exchangeable Shares, as
applicable, in the event of a PureRay U.S. Control Transaction.



2.8 PureRay U.S. and Affiliates Not to Vote Exchangeable Shares




PureRay U.S. covenants and agrees that it will appoint and cause to be appointed proxy holders with
respect to all Exchangeable Shares held by PureRay U.S. and its Affiliates for the sole purpose of
attending each meeting of holders of Exchangeable Shares in order to be counted as part of the
quorum for each such meeting. PureRay U.S. further covenants and agrees that it will not, and will
cause its Affiliates not to, exercise any voting rights that may be exercisable by holders of
Exchangeable Shares from time to time pursuant to the Exchangeable Share Provisions or pursuant to
the provisions of the Canada Business Corporations Act (or any successor or other corporate statute
by which the Corporation may in the future be governed) with respect to any Exchangeable Shares
held by it or by its Affiliates in respect of any matter considered at any meeting of holders of
Exchangeable Shares.



2.9 Ownership of Outstanding Shares




Without the prior approval of the Corporation and the prior approval of the holders of Exchangeable
Shares given in accordance with section 9 of the Exchangeable Share Provisions, PureRay U.S.
covenants and agrees in favour of the Corporation that, as long as any outstanding Exchangeable
Shares are owned by any person or entity other than PureRay U.S. or any of its Affiliates, PureRay
U.S. will be and remain the direct or indirect beneficial owner of all issued and outstanding
voting shares in the capital of the Corporation and PureRay Holdings.



ARTICLE 3

PURERAY U.S. SUCCESSORS




3.1 Certain Requirements in Respect of Combination, Etc.




PureRay U.S., directly or indirectly, 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,
but may do so if:









 



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	 	(a)	 	such other person or continuing corporation (the “PureRay U.S. 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 reasonably necessary or advisable to evidence the
assumption by the PureRay U.S. Successor of liability for all moneys payable and
property deliverable by PureRay U.S. hereunder and the covenant of such PureRay U.S.
Successor to pay and deliver or cause to be paid and delivered the same and its
agreement to observe and perform all the covenants and obligations of PureRay U.S.
under this Agreement; and
	 
	 	(ii)	 	such transaction shall be upon such terms and conditions so as to substantially
preserve and not impair in any material respect the rights, interests, duties, powers
and authorities of the other parties hereunder or the holders of Exchangeable Shares.





3.2 Vesting of Powers in PureRay U.S. Successor




Whenever the conditions of section 3.1 have been duly observed and performed, the PureRay U.S.
Successor and the parties hereto, if required by section 3.1, shall execute and deliver a
supplemental agreement hereto and thereupon PureRay U.S. Successor shall possess and from time to
time may exercise each and every right and power of PureRay U.S. under this Agreement in the name
of PureRay U.S. 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 PureRay U.S. or any officers of PureRay U.S.
may be done and performed with like force and effect by the directors or officers of such PureRay
U.S. Successor.



3.3 Wholly-Owned Subsidiaries




Nothing herein shall be construed as preventing the amalgamation, merger, or other combination of
any wholly-owned direct or indirect subsidiary of PureRay U.S. with or into PureRay U.S. or the
winding-up, liquidation or dissolution of any wholly-owned subsidiary of PureRay U.S. provided that
all of the assets of such subsidiary are transferred to, and all obligations of such subsidiary are
assumed by, PureRay U.S. or another wholly-owned direct or indirect subsidiary of PureRay U.S., and
any such transactions are expressly permitted by this Article 3.



ARTICLE 4

GENERAL




4.1 Term




This Agreement shall come into force and be effective as of the date hereof and shall terminate and
be of no further force and effect at such time as no Exchangeable Shares (or securities or rights
convertible into or exchangeable for or carrying rights to acquire Exchangeable Shares) are held by
any party other than PureRay U.S. and any of its Affiliates.



4.2 Changes in Capital of PureRay U.S. and the Corporation




Notwithstanding the provisions of section 4.4 hereof, at all times after the occurrence of any
event effected pursuant to section 2.6 or 2.7 hereof or otherwise, as a result of which either the
PureRay U.S. Common Shares or the 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 PureRay U.S. Common
Shares or the Exchangeable









 



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Shares or both are so changed and the parties hereto shall execute and deliver an agreement in
writing giving effect to and evidencing such necessary amendments and modifications.



4.3 Severability




If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced
by any rule or law, or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially adverse to any party.
Upon such determination that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable manner to the end that
the transactions contemplated hereby are fulfilled to the fullest extent possible.



4.4 Amendments, Modifications, Etc.




This Agreement may not be amended or modified except by an agreement in writing executed by the
Corporation, PureRay U.S. and PureRay Holdings and approved by the holders of the Exchangeable
Shares in accordance with section 9 of the Exchangeable Share Provisions.



4.5 Administrative Amendments




Notwithstanding the provisions of section 4.4, the parties to this Agreement may in writing, at any
time and from time to time, without the approval of the holders of the Exchangeable Shares, amend
or modify this Agreement for the purposes of: (i) adding to the covenants of any or all parties
provided that in the good faith opinion of the Board of Directors and the board of directors of
PureRay U.S. such additions will not be prejudicial to the rights or interests of the holders of
the Exchangeable Shares; (ii) 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 and the board of directors of PureRay U.S., it may be
expedient to make, provided that each such board of directors shall be of the good faith opinion
that such amendments or modifications will not be prejudicial to the interests of the holders of
the Exchangeable Shares; or (iii) making such changes or corrections which, on the written advice
of counsel to the Corporation and PureRay U.S., 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 in the good faith opinion of the Board of Directors and the board of
directors of PureRay U.S. such changes or corrections will not be prejudicial to the interests of
the holders of the Exchangeable Shares.



4.6 Meeting to Consider Amendments




The Corporation, at the request of PureRay U.S., shall call a meeting or meetings of the holders of
the Exchangeable Shares for the purpose of considering any proposed amendment or modification
requiring approval pursuant to section 4.4 hereof. Any such meeting or meetings shall be called
and held in accordance with the by-laws of the Corporation, the Exchangeable Share Provisions and
all applicable laws.



4.7 Enurement




This Agreement shall be binding upon and enure to the benefit of the parties hereto, the holders of
the Exchangeable Shares and their respective successors and permitted assigns, as well as to their
respective heirs, executors, trustees, administrators and other personal representatives.









 



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4.8 Notices to Parties




All notices and other communications between the parties shall be in writing and shall be deemed to
have been given if delivered personally or by overnight courier service, transmitted by facsimile
or mailed by registered or certified mail, postage prepaid to the parties at the following
addresses (or at such other address for either such party as shall be specified in like notice):




If to PureRay U.S., the Corporation or PureRay Holdings to it at:


3625 Cumberland Blvd

Suite 600

Atlanta, GA 30339



Attention:            President

Facsimile:           678-202-8911




Any notice or other communication given in accordance herewith shall be deemed to have been given
and received upon 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.



4.9 Counterparts




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



4.10 Governing Law




This Agreement shall be construed and enforced in accordance with the laws of the Province of
Ontario and the laws of Canada applicable therein without regard to principles of conflicts of
laws.



4.11 Attornment




Any action or proceeding arising out of or relating to this Agreement may be instituted in the
courts of Ontario, and each party hereby 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 judgment of the said courts and
not to seek, and hereby waives, any review of the merits of any such judgment by the courts of any
other jurisdiction and each party (other than the Corporation) hereby appoints the Corporation at
its registered office in the province of Ontario as such party’s 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.



	 	 	 	 	 
	 	NORTH AMERICAN NATURAL GAS, INC.

 	 
	 	By:  	/s/ Jim Glavas
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PURERAY HOLDINGS ULC

 	 
	 	By:  	/s/ Jim Glavas
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	PURERAY ACQUISITION INC.

 	 
	 	By:  	/s/ Jim Glavas
 	 
	 	 	Name:  	 	 
	 	 	Title: