**Exhibit 4.11****SHARE PURCHASE AGREEMENT****THIS AGREEMENT**made as of the 2nd day of November, 2005.**AMONG:****OFFSHORE SYSTEMS INTERNATIONAL LTD.,** a British Columbiacorporation having its head office in North Vancouver, BritishColumbia (“**OSIL”**)**OF THE FIRST PART****AND:****OSI HOLDINGS INC.,** a Delaware corporation having itsregistered office in Wilmington, Delaware (“**Newco**”)**OF THE SECOND PART****AND:****THE UNDERSIGNED SHAREHOLDERS OF CHI SYSTEMS INC.**(individually a “**Seller**” and collectively the “**Sellers**”)**OF THE THIRD PART****AND:****CHI SYSTEMS INC.****,**a Pennsylvania corporation having its headoffice in Fort Washington, PA (“**CHI**”)**WITNESSES THAT WHEREAS:**A. The Sellers are, and on Closing will be, the registered and beneficial owners of all of the CHIShares;B. OSIL wishes to purchase all of the CHI Shares;C. Newco is a wholly owned subsidiary of OSIL, has no assets or operations and has been organizedby OSIL for the purpose of acquiring all of the CHI Shares;D. The Sellers have agreed to sell their CHI Shares and OSIL has agreed to purchase the CHI Sharesupon the terms and conditions set forth herein; andE. This Agreement, upon execution, will replace the Letter of Intent.**NOW THEREFORE**the parties agree as follows:**PART 1****INTERPRETATION**
 

 
**Definitions**1.1 In this Agreement, including the recitals:“**Adjustment Time**” means 11:59 p.m., Eastern Time, on the Closing Date;“**Affiliate**” of a particular Person means another Person directly or indirectly controlling orcontrolled by, or under direct or indirect common control with, the particular Person, and for thepurposes of this definition, “control”, “controlling” and “controlled” import the power to directmanagement and policies, directly or indirectly, whether through ownership of voting securities, bycontract or otherwise;“**Applicable Securities Laws**” means the securities legislation having application and the rules,policies, notices and orders issued by applicable securities regulatory authorities, including theTSX and the United States Securities and Exchange Commission (“**SEC**”), having application to OSIL;“**Business Day**” means a day which is not a Saturday, Sunday or a statutory holiday in BritishColumbia or Pennsylvania;“**CHI Financial Statements**” means collectively the unaudited financial statements of CHI for thefinancial years ended September 30, 2004, 2003 and 2002, true copies of which are attached as**Schedule 2.1.9**;“**CHI Financial Statement Date**” means September 30, 2004;“**CHI Options**” means the outstanding options granted to certain Sellers to acquire Class Bnon-voting shares in the capital stock of CHI as described in the **Schedule 2.1.5**;“**CHI Shares**” means all of the issued and outstanding shares and other securities of any class ofCHI owned by the Sellers as at the Adjustment Time;“**Closing**” means the completion of the sale and purchase of CHI Shares provided for herein;**“Code”**means the United States Internal Revenue Code of 1986, as amended, and the regulationsthereunder;**“Disposal,” “Storage,”**and **“Treatment”**shall have the meanings assigned them at 42 U.S.C. §6903(3), (33) and (34), respectively;“**DSS**” means the Defense Security Service of the United States Department of Defense;“**Encumbrance**” means a security interest, mortgage, pledge, hypothecation, lien, lease, license,assignment, option, claim or other title defect, encumbrance or charge whatsoever, whether or notperfected or unperfected, filed or unfiled;
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**“Environmental Laws”**means any Law pertaining to the environment or the health or safety of thepublic and the Release or threatened Release of Hazardous Materials or otherwise regulating themanufacture, processing, distribution, use, Treatment, Storage, transport or handling of HazardousMaterials, including, without limitation: the Comprehensive Environmental Response, Compensationand Liability Act, 42 U.S.C. § 9601, *et seq.*; the Solid Waste Disposal Act, 42 U.S.C. § 6901, *etseq.*; the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. § 11001, *et seq.*; theHazardous Materials Transportation Act, 49 U.S.C. § 5101, *et seq.*; the Clean Air Act, 42 U.S.C. §7401, *et seq.*; the Clean Water Act, 33 U.S.C. § 1251, *et seq.*; the Toxic Substances Control Act, 15U.S.C. § 2601, *et seq.*; and the Oil Pollution Act of 1990, 33 U.S.C. § 2701, *et seq*.; each asamended; any state or local Law similar to the foregoing; and all regulations issued pursuant tothe foregoing;**“ERISA”**means the Employee Retirement Income Security Act of 1974, as amended, and the regulationsthereunder;**“Facility Security Clearance”**means an administrative determination that, from a securityviewpoint, a facility is eligible for access to classified information of a certain category andall lower categories that has been determined pursuant to Executive Order 12958 or any predecessororder to require protection against unauthorized disclosure and is so designated. Theclassifications Top Secret, Secret and Confidential are used to designate such information;**“GAAP”**means generally accepted accounting principles as in effect in the United States on theClosing Date, applied on a basis consistent with CHI’s past practices;“**Governmental Authority**” means a federal, state, regional, municipal or local government and anyagency or subdivision thereof, (including without limitation the US Department of Defense)including an entity or person exercising executive, legislative, judicial, regulatory oradministrative functions of, or pertaining to, any such government or subdivision, and includingwithout limitation DSS;**“Hazardous Material”**means any waste, chemical or other substance that is listed, defined,designated, identified or classified as hazardous, radioactive, reactive, toxic, ignitable orcorrosive, or a pollutant or a contaminant, under or pursuant to any Environmental Law, andspecifically including petroleum and all derivatives thereof, asbestos or asbestos-containingmaterials and polychlorinated biphenyls;**“Law”**means any common law decision and any federal, state, regional, local or foreign law,statute, ordinance, code, rule, regulation, order or treaty;“**Letter of Intent**” means the letter of intent respecting the transactions contemplated hereby datedJuly 8, 2005 among OSIL, CHI, Wayne W. Zachary and Floyd A. Glenn III, as amended;“**Majority Shareholders**” means Wayne W. Zachary and Floyd A. Glenn III;“**Minority Shareholders**” means the Sellers other than the Majority Shareholders;
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“**NASD**” means the National Association of Securities Dealers.“**Option Plan**” means the CHI Systems, Inc. 1998 Stock Option Plan;“**Party**” means a party to this Agreement, and “**Parties**” means two or more of such parties;“**Person**” includes an individual, corporation, body corporate, partnership, joint venture,association, trust or unincorporated organization or any trustee, executor, administrator or otherlegal representative thereof;**“Personnel Security Clearance”**means an administrative determination that an individual iseligible, from a security point of view, for access to classified information of the same or lowercategory as the level of personnel clearance granted;“**Public Record**” means information which has been publicly filed at www.sedar.com orwww.sec.gov/edgar/searchedgar/webusers.htm by OSIL under Applicable Securities Laws;**“Release”**shall have the meaning assigned it at 42 U.S.C. § 9601(22);“**Retained Earnings Threshold**” means $1,476,321, which is the amount of CHI’s retained earnings asshown on CHI’s balance sheet for its financial year ended September 30, 2004.“**Schedule**” means a schedule to this Agreement;“**Settlement Date**” means the date that is 90 days after the Closing Date;“**Shareholders’ Agreement**” means that certain shareholders’ agreement among CHI and certain of theSellers dated June 30, 1991 as amended by amending agreements dated August 23, 1995 and September24, 2003; and“**TSX**” means the Toronto Stock Exchange.Each term in the following table has the meaning set forth in the Section number across from suchterm.         **TERM** **—** **§**1933 Act  —   2.2.7 Accounts Receivable  —   4.3.2(b)AR Deficiency  —   4.3.2(b)AR Report  —   4.3.2(b)Bid  —   2.1.25(f)Business of CHI  —   2.1.68 Cash Purchase PriceReduction  —   9.7 CFIUS  —   6.1.10 Leases  —   2.1.22 Material Contracts  —   2.1.24 Mindbuzz  —   6.1.12(a)NIDs  —   9.4(b)NISPOM  —   9.4(b)Objections  —  4.3.2(a)(ii)OSIL Intellectual Property  —   3.1.16(a)OSIL’s Losses  —   10.2 
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         **TERM** **—** **§**CHI Intellectual Property  —   2.1.12 CHI Terrain  —   6.1.12(b)Closing Balance Sheet  —   4.3.2(a)Closing Date  —   5.1 Confidentiality Agreement  —   2.1.76 DDTC  —   6.1.10 DoE  —   6.1.10 Domain Name  —   2.1.19 Exon-Florio  —   6.1.10 FCPA  —   2.1.25(d)FOCI  —   6.1.10 Government Contract  —   2.1.25(f)Holdback  —   4.3.2 Holder  —   9.7 ITAR  —   6.1.10 OSIL Shares  —   4.3.4(a)Plans  —   2.1.30 Purchase Price  —   4.2 Real Property  —   2.1.22 Registered Shares  —   9.11 Retained Earnings  —   4.3.2(a)Retained Earnings Deficiency  —   4.3.2(a)Retained Earnings Surplus  —   4.3.2(a)Sellers’ Losses  —   10.4 Selling Investor  —   9.11 Stock Purchase Price Reduction  —   9.7 Strike Price Amount  —   9.7 Tax, Taxes  —   2.1.54 Tax Return, Tax Returns  —   2.1.54 Other terms defined within the body of this Agreement will have the meanings so ascribed to themthroughout this Agreement.1.2 The Schedules to this Agreement include the following:**CHI SCHEDULES**     Schedule 2.1.5 — Authorized and Issued Capital of CHISchedule 2.1.5-1 — Form of CHI OptionSchedule 2.1.9 — CHI Financial StatementsSchedule 2.1.10 — No Material Adverse ChangesSchedule 2.1.11 — Unusual TransactionsSchedule 2.1.12 — CHI Intellectual PropertySchedule 2.1.20 — Title to PropertiesSchedule 2.1.21 — List of Leased EquipmentSchedule 2.1.22 — List of Leases of Real PropertySchedule 2.1.23 — Material ContractsSchedule 2.1.24 — Material Contract ExceptionsSchedule 2.1.25 — Defaults and Notices of Non-Compliance under Material ContractsSchedule 2.1.26   Information respecting CHI EmployeesSchedule 2.1.30 — Employee Benefit PlansSchedule 2.1.32 — Employment ClaimsSchedule 2.1.33 — Employment ObligationsSchedule 2.1.39 — Guarantees or IndemnitiesSchedule 2.1.40 — Conflicting AgreementsSchedule 2.1.41 — Litigation
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     Schedule 2.1.43 — CHI Insurance PoliciesSchedule 2.1.53 — Approvals RequiredSchedule 2.1.60 — InventorySchedule 2.1.67 — Loss Carryforwards and Credit CarryforwardsSchedule 2.1.68 — Transactions with Related PartiesSchedule 2.1.73 — CHI Bank Accounts and Business NumbersSchedule 2.1.74 — Environmental MattersSchedule 2.1.76 — Confidentiality AgreementsSchedule 2.1.77 — Restrictions on BusinessSchedule 2.1.78 — Undisclosed LiabilitiesSchedule 4.3.1 — Allocation of $7,250,000 Cash Portion of Purchase Price Among SellersSchedule 4.3.2(b) — Accounts Receivable and Government Contract HoldbacksSchedule 4.3.3 — Form of Escrow Agreement re Portion of Purchase PriceSchedule 4.3.4(a) — Allocation of OSIL Share Portion of Purchase Price Among SellersSchedule 4.3.4(b) — Allocation of Cash In Lieu of OSIL Shares Portion of Purchase Price Among SellersSchedule 6.1.7 — Forms of Employment Agreements between CHI and Wayne W. Zachary, Floyd A. Glenn III and Geraldine BurkeSchedule 6.1.9 — Form of Non-Competition AgreementSchedule 6.1.10 — Governmental ConsentsSchedule 6.1.12 — Capital Contribution AgreementSchedule 6.1.13(e) — Form of ReleaseSchedule 6.1.13(l) — Form of Legal Opinion of Counsel to CHI and SellersSchedule 8.1 — Conduct of CHI BusinessSchedule 10.3.1 — Majority Shareholder Purchase Price ReceivedSchedule 10.3.2 — Minority Shareholder Purchase Price ReceivedOSIL SCHEDULES     Schedule 3.1.5 — Exceptions respecting OSIL Financial StatementsSchedule 3.1.13 — OSIL Authorized CapitalSchedule 3.1.15 — Preemptive Rights and Rights of First RefusalSchedule 7.1.9(g) — Form of Legal Opinion of Counsel to OSIL and NewcoSchedule 9.8 — Re-domiciling Memorandum**Interpretation**1.3 For the purposes of this Agreement, except as otherwise expressly provided herein:     1.3.1 “**this Agreement**” means this Agreement, including the Schedules, as it may from time totime be supplemented or amended and in effect;     1.3.2 the words “**herein**”, “**hereof**” and “**hereunder**” and other words of similar import
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refer to this Agreement as a whole and not to any particular section, paragraph, subparagraph orother subdivision or Schedule;     1.3.3 a reference to a Part of this Agreement refers to the section, paragraph, subparagraph,clause or subclause of this Agreement so designated;     1.3.4 the singular of any term includes the plural and vice versa;     1.3.5 the word “**or**” is not exclusive and the word “**including**” is not limiting (whether or notnon-limiting language such as “**without limitation**” or “**but not limited to**” or other words ofsimilar import is used with reference thereto);     1.3.6 a reference to a statute or regulation includes and is a reference to such statute andto the regulations made pursuant thereto with all amendments made thereto and in force as of thedate of execution of this Agreement, and to any statute or regulations that have been passed priorto the date of execution of this Agreement that have the effect of supplementing or supersedingsuch statute or such regulations;     1.3.7 where the phrase “**to the best of the knowledge of**” or “**to the knowledge of**” or a phraseof similar import is used, it will mean to the best of the knowledge, information and belief, afterhaving made reasonable inquiry, of the Party or Parties giving such covenant, representation andwarranty;     1.3.8 the headings to the sections and subsections of this Agreement are inserted forconvenience only and do not form a part of this Agreement and are not intended to interpret, defineor limit the scope, extent or intent of this Agreement or any provision hereof;     1.3.9 a reference to a corporate entity includes and is also a reference to any corporateentity that is a successor to such entity;     1.3.10 the language in all parts of this Agreement will in all cases be construed as a wholeand neither strictly for nor strictly against any party;     1.3.11 every covenant, representation or warranty of each Seller contained herein will be suchSeller’s several, and not joint and several, covenant, representation or warranty unless otherwisestipulated;     1.3.12 every reference to “**$**” or money in this Agreement is to lawful money of the UnitedStates of America unless otherwise stipulated; and     1.3.13 nothing in any Schedule hereto shall be deemed adequate to disclose an exception to arepresentation or warranty made by CHI herein unless such Schedule identifies the exception withreasonable particularity and describes the relevant facts in reasonable detail. Notwithstandingthe foregoing, an item disclosed on any Schedule shall be deemed to be disclosed on any otherSchedule to which such item is relevant whether or not specifically disclosed on any otherSchedule.
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**PART 2****REPRESENTATIONS AND WARRANTIES OF SELLERS****Representations and Warranties of Majority Shareholders**2.1 In order to induce OSIL and Newco to enter into and consummate the transactions contemplated bythis Agreement, the Majority Shareholders severally, and not jointly and severally, represent andwarrant to OSIL and Newco that as of the date hereof, except as otherwise specified herein or inspecified in the relevant Schedule:     **Organization and Good Standing of CHI**     2.1.1 CHI is duly incorporated and is validly existing under the laws of Pennsylvania and issubsisting in the Commonwealth of Pennsylvania and has all necessary corporate power, authority andcapacity to own its assets and to carry on its business as presently conducted and to enter intothis Agreement;     2.1.2 CHI’s head office is located in Fort Washington, Pennsylvania, and CHI has branchoffices in Orlando, Florida and San Diego, California. Neither the nature of the business of CHInor the location or character of the property owned or leased by it requires that CHI beregistered, licensed or otherwise qualified, or to be in good standing, in any other jurisdictionother than the States of Pennsylvania, California and Florida, and it is subsisting or in goodstanding in each of these States;     **Corporate Records and Proceedings**     2.1.3 CHI has made available to OSIL the following documents which are currently and shall beon the Closing Date, true, current, complete and correct in all material respects, and anysignatures contained in such documents are the true signatures of the Persons who are purported tohave signed same:          (a) its Articles of Incorporation and Bylaws and all amendments thereto;          (b) the minute books containing minutes of all meetings of its directors and shareholders orresolutions in lieu thereof;          (c) a list of all of its officers and directors; and          (d) CHI’s stock ledger;     **Permits and Licences**     2.1.4 CHI holds all permits, licenses, consents, registrations and authorizations issued byany Governmental Authority, that are necessary in connection with the conduct and operation of itsbusiness, and the ownership or leasing of its assets as they are now owned, leased,
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conducted or operated, except for such permits, licenses, consents, registrations andauthorizations the failure of which to hold would not have a material adverse effect on CHI’sbusiness, properties, assets or future prospects, and CHI is not, in any material respect, inbreach of or in default under any term or condition of any thereof;     **Authorized and Issued Capital**     2.1.5 The authorized capital of CHI consists of 150,000 Class A voting shares of common stockwith no par value and 100,000 Class B non-voting shares of common stock, of which 17,100 Class Ashares, 1,042 Class B shares and 2,009 CHI Options are issued and outstanding and are held by theSellers in the amounts set forth opposite their respective names in **Schedule 2.1.5**, and aftergiving effect to the exercise of CHI Options pursuant to **Section 9.7**, the authorized capital of CHIwill consist of 150,000 Class A voting shares of common stock with no par value and 100,000 Class Bnon-voting shares of common stock, of which 17,100 Class A shares, 3,051 Class B shares and no CHIOptions will be issued and outstanding and will held by the Sellers in the amounts and in thepercentages set forth opposite their respective names in **Schedule 2.1.5**. The exercise prices ofthe CHI Options are set out in **Schedule 2.1.5**. The CHI Options conform in all material respects tothe form of option attached hereto as **Schedule 2.1.5-1**. Subject to the issuance of CHI Shares tothe Optionees in accordance with their exercise of CHI Options, as set forth in **Section 9.7**, all ofthe CHI Shares have been duly and validly issued and are outstanding as fully paid andnon-assessable shares;     **Options, etc. in CHI**     2.1.6 Except as set forth on **Schedule 2.1.5**, no Person has any agreement or option, present orfuture, contingent, absolute or capable of becoming an agreement or option or which with thepassage of time or the occurrence of any event could become an agreement or option:          (a) to require CHI to:               (i) allot or issue any further or other share in its capital or any other security convertibleor exchangeable into any share in its capital, or               (ii) convert or exchange any security into or for any share its capital, or          (b) to require CHI to purchase, redeem or otherwise acquire any issued and outstanding sharesin its capital, other than those Sellers who hold CHI Options;     **No Violation of Charter Documents**     2.1.7 The execution, delivery and performance of this Agreement by Sellers and CHI will not(with or without notice or lapse of time) violate any provision of the Articles of Incorporation orBylaws of CHI;     **Business and Assets of CHI**
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     2.1.8 CHI does not own any shares in or other securities of, or have any interest in theassets or business of, any other Person;     **CHI Financial Statements**     2.1.9 The CHI Financial Statements (which are attached hereto as **Schedule 2.1.9**):          (a) reflect accurately the transactions entered into the books and accounts of CHI as at thedates thereof;          (b) are true, complete and correct in all material respects and present fairly the balancesheet, profit and loss and financial condition of CHI as at the dates thereof; and          (c) have been prepared in accordance with GAAP;     **No Material Adverse Changes**     2.1.10 Except as set forth on **Schedule 2.1.10**, since the CHI Financial Statement Date:          (a) CHI has carried on its business in the ordinary and normal course;          (b) there has not been any change in the condition or operations of the business, assets orfinancial affairs of CHI which are, individually or in the aggregate, adverse in any materialrespect to the properties, assets, business, future prospects or financial conditions of CHI;          (c) there has not been any damage, destruction or loss, labour trouble or other event,development or condition, of any character (whether or not covered by insurance) which has or may,in any material respect, adversely affect the business, properties, assets or future prospects ofCHI; and          (d) no capital expenditures (which, for greater certainty does not include repair andmaintenance expenditures in the ordinary course of the routine daily affairs of CHI) that, in theaggregate, exceed $100,000.00**,**have been authorized, committed or made by CHI;     **No Unusual Transactions**     2.1.11 Except as provided for in the CHI Financial Statements or except as otherwise set forthon **Schedule 2.1.11**, CHI has not, since the CHI Financial Statement Date:          (a) transferred, assigned, sold or otherwise disposed of any asset reflected in the CHIFinancial Statements or cancelled any debt or claim except in each case in the ordinary and normalcourse of its business, or except where any such transfers, assignments, dispositions orcancellations would not individually or collectively have a material adverse effect on CHI;          (b) incurred or assumed any obligation or liability (fixed or contingent),
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except unsecured current obligations and liabilities incurred in the ordinary and normalcourse of its business;          (c) authorized, issued or sold any share in its capital or any warrant, bond, debenture orother corporate security or issued, granted or delivered any right, option or other commitment forthe issuance of any such or other security;          (d) declared or made, or committed itself to make, any payment of any dividend or otherdistribution on or in respect of any share in its capital or purchased or redeemed or split,consolidated or reclassified any such share;          (e) suffered an operating loss or any extraordinary loss or entered into any commitment ortransaction other than in the ordinary and normal course of its business;          (f) waived or surrendered any right of material value;          (g) made any gift of money or of any property or asset to any Person;          (h) purchased any material asset, other than in the ordinary course of business;          (i) amended or changed or taken any action to amend or change the Articles of Incorporation orBylaws of CHI;          (j) increased or agreed to increase the remuneration of, or paid or agreed to pay any pension,bonus, share of profits or other similar benefit to, any current or former employee, consultant,director or officer of CHI or any Seller;          (k) made any payment of any kind to or on behalf of any current or former employee,consultant, director or officer of CHI or any Seller or any affiliate or associate of any or all ofthe Sellers or under any management agreement with CHI other than business-related expenses andsalaries in the ordinary and normal course of its business and at the regular rates payable to themas at the date such payments were made;          (l) mortgaged, pledged, subjected to lien, granted a security interest in or otherwiseencumbered any of its assets or property, whether tangible or intangible; or          (m) authorized or agreed or otherwise become committed to do any of the foregoing;     **CHI Intellectual Property**     2.1.12 **Schedule 2.1.12**annexed hereto is a complete and accurate list of all materialregistered and unregistered, issued and pending, trademarks, service marks, trade names, patents,inventions, trade secrets, Domain Names (as defined in **Section 2.1.19**), copyrights, service marks,industrial designs, proprietary hardware, proprietary software, applications for the registrationthereof and other industrial and intellectual property (collectively the “**CHI**
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**Intellectual Property**”) owned or licensed by CHI;     2.1.13 Except as set forth on **Schedule 2.1.12**, CHI has the right to use all such CHIIntellectual Property without restriction of any nature whatsoever and the consummation of thetransactions contemplated herein will not adversely affect the right of CHI to use such CHIIntellectual Property without restriction;     2.1.14 Except for CHI Intellectual Property that is licensed by CHI and identified as such in**Schedule 2.1.12**, CHI is the registered and beneficial owner of all CHI Intellectual Property withgood and marketable title, unencumbered, and subject to no pending challenge, revocation, expiry ortermination;     2.1.15 Except as set forth on **Schedule 2.1.12**, to the Majority Shareholders’ knowledge, thereare no judgments, decrees or orders restricting or limiting the use by CHI of any of the CHIIntellectual Property and the operation of the business of CHI does not violate, breach or infringeany patents, copyrights, trade names, trademarks, industrial designs or licenses held by others andthe Sellers have no knowledge of any alleged breach or violation thereof;     2.1.16 Except as disclosed in **Schedule 2.1.12**, CHI has not granted any other party rights withrespect to the CHI Intellectual Property or disclosed any source codes for its proprietary software(if any) to any third party, and the patent**s**, trademarks, service marks, industrial designs andcopyrights set forth in **Schedule 2.1.12**are valid and all applications for registration or issuancein respect thereof set forth on **Schedule 2.1.12**have been duly filed;     2.1.17 The use of the material CHI Intellectual Property by CHI has not infringed upon therights of any other party and CHI has not received any notice of the revocation, withdrawal,expiration, abandonment or breach of any right to use the CHI Intellectual Property;     2.1.18 To the Majority Shareholders’ knowledge no party is (i) infringing upon CHI’s rights tothe CHI Intellectual Property; (ii) in breach of any license or other agreement respecting the CHIIntellectual Property; or (iii) otherwise engaged in any unlawful license, sale or use of the CHIIntellectual Property;     2.1.19 All Domain Names of CHI are duly registered with the authority charged with maintainingsame and such domain names do not violate or exist in breach of the intellectual property rights ofany other Person; CHI has the right to own and use the domain names listed in **Schedule 2.1.12**. Theterm “**Domain Name**” as used herein is a name or address used to identify or locate a particularU.R.L. on the Internet;     **Title to Properties**     2.1.20 Except as set forth on **Schedule 2.1.20**, CHI has good and marketable title to all of itsassets, properties, interests in properties, real and personal, including those reflected in theCHI Financial Statements or that have been acquired since the CHI Financial Statement Date (exceptfor those which have been transferred, sold or otherwise disposed of in the ordinary and normalcourse of business), free and clear of all Encumbrances, and none of CHI’s properties or
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assets is in the possession of or under the control of any other Person except for its leaseof the Real Property;     **Leased Equipment**     2.1.21 CHI has no equipment that, as of Closing Date, is leased or is held under license orsimilar arrangement except as set forth in **Schedule 2.1.21**;     **Leases of Real Property**     2.1.22 CHI does not own any real property. **Schedule 2.1.22**identifies all real propertypresently leased, subleased to, or otherwise occupied by CHI (collectively, the “**Real Property**”).The leases relating to the Real Property are referred to as the “**Leases**”. The Leases are eachvalid and in full force and effect against CHI, and against the other parties thereto, and CHIholds valid and existing leasehold interests thereunder for the respective terms set forth in theLeases. CHI is not in default under the material terms of any of the Leases. Since September 30,2004, neither CHI nor any of its Affiliates has received written notice of any pending orthreatened condemnations, planned public improvements, annexation, special assessments, zoning orsubdivision changes, or other adverse claims affecting the Real Property;     **Material Contracts**     2.1.23 **Schedule 2.1.23**contains a complete and accurate list and description of any and allcontracts material to CHI, including:          (a) contracts that involve commitments to make capital expenditures or that provide for thepurchase of goods or services by CHI from any one Person under which the undelivered balance ofsuch goods or services has a purchase price in excess of $25,000;          (b) contracts that provide for the sale of goods or services by CHI and under which theundelivered balance of such goods or services has a sale price in excess of $75,000;          (c) each contract relating to the borrowing of money by CHI, to the granting by CHI of anEncumbrance on any of its assets, or any guaranty or similar undertaking by CHI of any obligationin respect of borrowed money or otherwise;          (d) each contract with dealers, distributors or sales representatives;          (e) each contract and any other agreement with any employee, officer, consultant, shareholder,management advisor or Affiliate of CHI;          (f) each contract commitment or arrangement that, by its terms, limits the freedom of CHI toengage in any business or compete with any Person;          (g) each contract pursuant to which CHI is a lessor or a lessee of any personal property orany real property, or holds or operates any tangible personal property owned by
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another Person;          (h) each power of attorney executed on behalf of CHI or any officer of CHI or any Seller thatis currently effective and outstanding;          (i) each contract entered into other than in the ordinary course of business that contains orprovides for an express undertaking by CHI to be responsible for consequential damages;          (j) each contract providing for payments to or by any Person based on sales, purchases orprofits, other than direct payment for goods;          (k) other contracts material to CHI’s business; and          (l) any commitments to enter into any of the foregoing.     2.1.24 All of the contracts required to be identified in **Schedule 2.1.23**, includingamendments, supplements and modifications thereto are referred to collectively as the “**MaterialContracts**”. All of the Material Contracts are in full force and effect in all material respectsand are enforceable in accordance with their respective terms, except as enforceability may berestricted, limited or delayed by applicable bankruptcy or other laws affecting creditors’ rightsgenerally and except as enforceability may be subject to general principles of equity. Except asset forth on **Schedule 2.1.24**, CHI has performed in all material respects all obligations requiredto be performed by it pursuant to such contracts, and there is no existing or, to the knowledge ofthe Majority Shareholders, threatened default under or violation of any of such contracts by anyother party thereto.     2.1.25 In addition to the representations set forth in **Section 2.1.24**, or except as set forthon **Schedule 2.1.25**:          (a) With respect to each Government Contract or Bid (as defined below) to which CHI is aparty, since September 30, 2004, (A) CHI has complied with all material terms and conditionsthereof and in all material respects with all applicable Laws; (B) no written notice has beenreceived alleging that CHI is in breach or violation of any statutory, regulatory or contractualrequirement; (C) no written notice of termination for convenience, termination for default, curenotice or show-cause notice has been received by CHI; (D) no cost incurred by CHI pertaining tosuch Government Contract for which CHI have sought reimbursement from any Governmental Authoritydirectly or indirectly has been formally questioned or challenged by written notice to CHI, or hasbeen disallowed by such Governmental Authority; and (E) no money due to CHI has been (or, to theknowledge of the Majority Shareholders, has been threatened to be) withheld or set off;          (b) Since September 30, 2004, (A) CHI has not received any written notice of, and neither CHInor, to the knowledge of the Majority Shareholders, any of CHI’s employees, agents or consultantsis under, any administrative, civil or criminal investigation by any Governmental Authorityrelating to, any alleged material irregularity, misstatement or omission
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arising under or relating to any Government Contract or Bid; and (B) CHI has not made anyvoluntary disclosure to any Governmental Authority with respect to any irregularity, misstatementor omission arising under or relating to a Government Contract;          (c) (i) neither CHI nor, to the knowledge of the Majority Shareholders, any of CHI’semployees, agents or consultants is (or since September 30, 2004 has been) suspended or debarredfrom doing business by any Governmental Authority or declared nonresponsible or ineligible forgovernment contracting, (ii) as of the date hereof, no suspension or debarment action is pending,or to the knowledge of the Majority Shareholders threatened, against CHI or any of CHI’s employees,agents or consultants for which CHI has received written notice thereof, and (iii) as of the datehereof, to the knowledge of the Majority Shareholders, there are no facts or circumstances whichwould reasonably be likely to result in a suspension or debarment proceeding or a finding ofnon-responsibility or ineligibility against CHI or any of CHI’s employees, agents or consultants;          (d) Since September 30, 2004, CHI has complied in all material respects with all applicableU.S. federal and state procurement laws, rules and regulations, including all applicable provisionsof the U.S. Truth in Negotiations Act, the U.S. Procurement Integrity Act, the U.S. Cost AccountingStandards and the U.S. Foreign Corrupt Practices Act (“**FCPA**”);          (e) To the knowledge of the Majority Shareholders, no Governmental Authority or any primecontractor, subcontractor or vendor is asserting (or since September 30, 2004 has asserted) anyclaim or is initiating any dispute proceeding against CHI relating to Government Contracts or Bids,nor is CHI asserting (or since September 30, 2004 has CHI asserted) any claim or initiating (orsince September 30, 2004 has CHI initiated) any dispute proceeding directly or indirectly againstany such party concerning any Government Contract or Bid;          (f) For purposes of this **Section 2.1.25**, the following terms shall have the following meaning:(i) “**Government Contract**” means any prime contract, subcontract, teaming agreement or arrangement,joint venture, basic ordering agreement, letter contract, purchase order, delivery order, Bid,change order, arrangement or other commitment of any kind between CHI and (a) any GovernmentalAuthority, (b) any prime contractor to any Governmental Authority or (c) any subcontractor withrespect to any contract described in clause (a) or (b), and (ii) “**Bid**” means any quotation, bid orproposal by CHI which, if accepted or awarded, would lead to a contract with any GovernmentalAuthority or any other entity, including a prime contractor or a higher tier subcontractor to anyGovernmental Authority, for the design, manufacture or sale of products or the provision ofservices by CHI.     **Employees, Etc.**     2.1.26 **Schedule 2.1.26**sets forth the names, titles and places of work of all of theemployees, associates and consultants of CHI, together with particulars of the material terms andconditions of employment or engagement of such Persons, including rates of remuneration, benefits,positions and Personnel Security Clearances held;
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     2.1.27 Each employee, associate or consultant of CHI has been paid all wages, income,remuneration and other amounts due and owing to him or her by CHI as at the end of the most recentcompleted pay period;     2.1.28 None of the Majority Shareholders is aware of any labour dispute with any of CHI’semployees, associates or consultants;     2.1.29 No individual who provides services to CHI and is not treated as an employee forfederal income tax purposes is an employee for such purposes;     **Benefit Plans**     2.1.30 Set forth in **Schedule 2.1.30**is a list of all material employee benefit plans (asdefined in Section 3(3) of ERISA), with respect to which CHI currently is the sponsor or obligatedto make contributions under the plan terms in connection with its employees (the “**Plans**”). Exceptas set forth on **Schedule 2.1.30**:          (a) none of the Plans is a “multiemployer plan” (as defined in Title I or Title IV of ERISA)or is subject to Title IV of ERISA, and CHI has not maintained or contributed to any such Plan forthe five years prior to September 30, 2005;          (b) each of the Plans that is intended to be tax-qualified under Section 401(a) of the Codehas received a favorable determination letter or opinion letter from the Internal Revenue Serviceand is so qualified, except that no representation is made with respect to any formal qualificationrequirement with respect to which the remedial amendment period under Section 401(b) of the Codehas not yet expired;          (c) all of the Plans have been operated in substantial compliance with their respective termsand all Laws, and all contributions required under the terms of the Plans or applicable Law havebeen timely made;          (d) there are no pending or, to the knowledge of Majority Shareholders, threatened, actions,suits or claims by or on behalf of any of the Plans, by any employee or beneficiary covered underany Plan or otherwise involving any Plan (other than routine claims for benefits);          (e) none of the Plans provide medical benefits to any retired Person, or any current employeeof CHI following such employee’s retirement or other termination of employment, except as requiredby applicable Law (including Section 4980B of the Code), and CHI has complied in all materialrespects with the requirements of Section 4980B of the Code and any applicable similar state laws;          (f) CHI does not maintain any Plan under which it would be obligated to pay benefits solelybecause of the consummation of the transactions contemplated by this Agreement, disregarding anytermination of employment that may occur on or after the Closing;
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          (g) neither CHI, nor any other “disqualified person” or “party in interest,” as defined inSection 4975 of the Code and Section 3(14)of ERISA, respectively, has engaged in any “prohibitedtransaction,” as defined in Section 4975 of the Code or Section 406 of ERISA that is not covered bya prohibited transaction exemption pursuant to Section 408(a) of ERISA, with respect to any Plan,nor have there been any fiduciary violations under ERISA, which could subject CHI (or any officer,director or employee thereof) to any material penalty or tax under Section 502(i)of ERISA orSection 4975 of the Code;          (h) all reports and disclosures relating to the Plans required to be filed or furnished togovernmental agencies or plan participants or beneficiaries have been filed or furnished in atimely manner; and          (i) as of the date hereof there is no litigation, audit, claim or, to the knowledge of theMajority Shareholders, investigation pending with respect to any Plan before the Internal RevenueService, the Department of Labor or the Pension Benefit Guaranty Corporation.     **Unions and Labour Practices**     2.1.31 No labor union, counsel of labor unions, employee bargaining representative oraffiliated bargaining representative:          (a) holds bargaining rights with respect to any of CHI’s employees by way of certification,interim certification, voluntary recognition, designation or successor rights; or          (b) has filed any petition seeking to be certified as the bargaining representative of any ofCHI’s employees.     2.1.32 Except as set forth on **Schedule 2.1.32**, during the two years immediately preceding thedate of execution of this Agreement there has been no complaint, grievance, claim, work order orinvestigation filed, made or commenced against CHI in respect of or affecting CHI or its businesspursuant to any applicable employee or employment legislation and there are no outstandingdecisions or settlements or pending settlements under any such legislation that place anyobligation upon CHI to do or refrain from doing any act or that place a financial obligation uponCHI;     2.1.33 Except as set forth on **Schedule 2.1.33**: CHI has paid or accrued all current obligationsunder all employment legislation in relation to CHI; CHI has not been subject to any special orpenalty assessment under any employment legislation that has not been paid and CHI’s workers’compensation claims experience has not resulted in any surcharge or additional premium beingimposed on CHI under any workers’ compensation legislation, and there are not currently pending anyclaims or investigations with respect to any of the foregoing;     2.1.34 There is no labour strike, picketing, work slow-down, work stoppage or lock-outactually pending or threatened against or directly or indirectly affecting CHI or any of itsoperations, and CHI has not experienced any strike, slowdown or work stoppage, lock-out or othercollective labour action by or with respect to its employees;
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     2.1.35 There are no charges with respect to or relating to CHI before any commission, agencyor body responsible for the prevention of unlawful employment practices. CHI has no notice fromany federal, state, local or other agency responsible for the enforcement of labour or employmentlaws of an intention to conduct an investigation of CHI or any of its business or employmentpractices and no such investigation is in progress;     2.1.36 CHI has complied in all material respects with all applicable laws relating toemployment and employment practices, wages, hours and terms and conditions of employment withrespect to employees, including part-time employees (if any) and has not engaged in any unfairlabour practice;     2.1.37 No agreement that is binding on CHI restricts it from relocating or closing any of itsoperations;     **Withholdings**     2.1.38 All amounts required to be withheld for Taxes (as defined in **Section 2.1.54**below) byCHI from payments made to any Person has been withheld and paid on a timely basis to the propergovernmental body pursuant to applicable legislation;     **No Guarantees or Indemnities**     2.1.39 Except as set forth on **Schedule 2.1.39**, CHI is not a party to or bound to any agreementof guarantee, indemnification (other than an indemnification of directors and officers inaccordance with the bylaws of CHI, as the case may be, and applicable laws and other standardindemnities in favour of CHI’s bankers to support any letter of credit obligations entered into inthe ordinary course of business) or any other like commitments in respect of the obligations,liabilities (contingent or otherwise) or indebtedness of any other Person;     **Conflicting Agreements**     2.1.40 Except as set forth on **Schedule 2.1.40**, CHI is not a party to, bound by or subject toany indenture, mortgage, lease, agreement, instrument, judgement or decree which would be violatedor breached, or under which default would occur or which could be terminated, cancelled oraccelerated, in whole or in part, as a result of the execution and delivery of this Agreement orthe consummation of any of the transactions provided for herein;     **Litigation**     2.1.41 Except as set forth on **Schedule 2.1.41**, there is no suit, action, litigation,arbitration proceeding or governmental proceeding, including any appeal or application for review,in progress, to the knowledge of the Sellers, pending or threatened against, or relating to CHI oraffecting any of its properties or assets or its business;     2.1.42 There is not presently outstanding against the Sellers or CHI any judgement, decree,injunction, rule or order of any court, governmental department, commission, agency,instrumentality or arbitrator;
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     **Insurance**     2.1.43 **Schedule 2.1.43**sets forth a list and brief description of all policies of fire,liability and other forms of insurance currently held by CHI, including the aggregate coverageamount and type of insurance (including whether such coverage is on a per occurrence or claims-madebasis, where applicable) generally applicable deductibles and the expiry dates thereof;     2.1.44 Except as set forth on **Schedule 2.1.43**, all premiums for such policies have been paid;     2.1.45 All insurance policies held by CHI:          (a) are valid, outstanding and in full force and effect;          (b) are in such amounts and provide insurance against such losses and risks as are adequateand consistent with the requirements of CHI’s business as currently conducted;          (c) are sufficient for compliance with all requirements of law and all agreements to which CHIis a party;          (d) will not in any way be affected by or terminated or lapsed by reason of the consummationof the transactions contemplated by this Agreement;     2.1.46 CHI is not in default under any provision of any policy of insurance and has notreceived notice of cancellation, non-renewal, termination or reduction of coverage of or under anysuch insurance, and no misstatement or misrepresentation has been made by CHI in any applicationfor any policy of insurance;     2.1.47 There is no claim by CHI pending under any policies as to which coverage has beenquestioned, denied or disputed by the underwriters or carriers of such policies;     2.1.48 CHI has not received any notice from or on behalf of any insurance carrier issuing suchpolicies that insurance rates will hereafter be substantially increased, that there will hereafterbe a cancellation, a change in the type of coverage provided, or an increase in a deductible (or anincrease in premiums in order to maintain an existing deductible) or non-renewal of existingpolicies, or that alteration of any equipment or any improvements to real estate occupied by orleased to or by CHI, the purchase of any additional equipment, or the modification of any of themethods of doing business of CHI, will be required or suggested;     2.1.49 Except as set forth on **Schedule 2.1.43**, the Majority Shareholders have no knowledge ofany state of facts, or of the occurrence of any event, that the Majority Shareholders know or havereason to believe might reasonably (i) form the basis for any claim against CHI not fully coveredby insurance or for any liability on account of any express or implied warranty or omission orcommission, or (ii) result in a material increase in insurance premiums of CHI;     2.1.50 CHI has not been refused any insurance with respect to its assets or operations,
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nor has its coverage been limited by any insurance carrier to which it has applied for anysuch insurance or with which it has carried insurance during the last three (3) years;     2.1.51 **Schedule 2.1.43**sets forth (i) CHI’s premiums and losses by year and by type ofcoverage for the past three (3) years, (ii) all outstanding insurance claims by CHI for damage toor loss of property or income that have been referred to insurers or that the Majority Shareholdersbelieves to be covered by commercial insurance and (iii) any agreements, arrangements orcommitments by or relating to CHI under which CHI indemnifies any other Person or is required tocarry insurance for the benefit of any other Person**;**     **Copies of Agreements and other Documents**     2.1.52 True, correct and complete copies of all CHI Material Contracts, agreements,instruments and other documents listed in the Schedules have been delivered or made available toOSIL prior to the date of execution of this Agreement;     **Approvals Required**     2.1.53 Other than as contemplated by **Section 6.1.10**and except as otherwise set forth on**Schedule 2.1.53**, no authorization, approval, order, license, permit or consent of any GovernmentalAuthority, regulatory body or court, and no registration, declaration or filing by any of theMajority Shareholders with any such Governmental Authority, regulatory body or court is required inorder:          (a) for the Majority Shareholders to incur the obligations expressed to be incurred by each ofthem pursuant to this Agreement;          (b) for the Majority Shareholders to execute and deliver all of the documents and instrumentsto be delivered by each of them pursuant to this Agreement;          (c) for the Majority Shareholders to duly perform and observe the terms and provisions of thisAgreement; or          (d) to render this Agreement legal, valid, binding and enforceable in accordance with itsterms.     **Tax Returns**     2.1.54 Other than CHI’s federal tax return and Pennsylvania state tax return for the fiscalyear ended September 30, 2005, all returns (including, without limitation, income tax, corporationtax, commodity tax, capital tax, transfer business tax, import duties, goods and services tax,value added tax, franchise tax, sales and use tax, unemployment compensation, customs duty, excisetax, severance, property tax, gross receipts tax, profits tax, payroll and withholding tax returnsand information returns) and reports of or relating to any federal, municipal, state, foreign orlocal tax, assessment or charge of any nature whatsoever (all, together with any penalties,additions to tax, fines and interest thereon or related thereto, herein
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referred to collectively as “**Taxes**” or singularly as a “**Tax**”) that are required to be filed(taking into account all extensions) on or before the Closing Date for, by, on behalf of or withrespect to CHI (all such returns and reports herein referred to collectively as “**Tax Returns**” orsingularly as a “**Tax Return**”), have been or will be timely filed with the appropriate taxationauthority on or before the Closing Date, and all Taxes shown to be due and payable on such TaxReturns or related to such Tax Returns have been paid in full when due; and CHI has delivered toOSIL true copies of income Tax Returns and all other material Tax Returns of CHI (i) in respect ofthe financial years ended September 30, 2004, 2003, 2002, (ii) in respect of any other period filedwithin four calendar years prior to the date hereof and (iii) for any other reporting periodsduring such financial years for which CHI was required to file Tax Returns;     2.1.55 All Tax Returns and the information and data contained therein have been properly andaccurately compiled and completed in all respects, fairly present in all respects the informationpurported to be shown therein, and reflect or will reflect all liabilities for Taxes for theperiods covered by such Tax Returns, unless such liability is otherwise adequately provided for inthe CHI Financial Statements;     2.1.56 No Tax Returns are now under audit or examination by any taxation or other authorityand there are no agreements, waivers or other arrangements providing for an extension of time withrespect to the assessment or collection of any Tax or Tax deficiency of any nature against CHI, orwith respect to any Tax Return and there are no suits or similar proceedings now pending or, to thebest of the knowledge of the Majority Shareholders, threatened against any of them with respect toany Tax, and there are no matters under discussion with any taxation or other authority relating toany Tax, or any claims for any additional Tax asserted by any such authority;     **Tax Liabilities**     2.1.57 CHI does not have any liability, obligation or commitment for the payment of Taxes,except those disclosed in the CHI Financial Statements and such Taxes known to the Sellers not yetdue as have arisen since the CHI Financial Statement Date in the usual and ordinary course ofbusiness and for which adequate provision in the accounts of CHI has been made;     2.1.58 CHI has properly and timely paid all Taxes required to be withheld and paid in anytaxing or other authority;     2.1.59 There are no currently outstanding assessments, reassessments or written inquiries thathave been raised by any governmental authority relating to Taxes or which may lead to theimposition of Taxes or the assessment or reassessment of any Taxes;     2.1.60 Except as set forth on **Schedule 2.1.60**, CHI has no inventory;     2.1.61 Since the CHI Financial Statement Date to the Closing Date, CHI has not acquired or hadthe use of any material property from a Person with whom it was not dealing at arm’s length;
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     2.1.62 Since the CHI Financial Statement Date to the Closing Date, CHI has not disposed ofanything material to a Person with whom it was not dealing at arm’s length for proceeds less thanthe fair market value thereof;     2.1.63 Since the CHI Financial Statement Date to the Closing Date, CHI has not discontinuedcarrying on any business in respect of which any material non-capital losses were incurred;     2.1.64 No monies are owing by CHI on account of sales tax or similar tax other than monieswhich are accruing for current filing periods for which Tax Returns respecting such Taxes are notyet due;     2.1.65 CHI has no obligation, pursuant to any Tax sharing agreement, indemnity agreement, taxallocation agreement or any other agreement, or any statute or regulation, to pay the Tax liabilityof any other person or to reimburse any other person for Taxes. CHI has not been a member of anaffiliated group of corporations filing consolidated Tax Returns for U.S. federal income taxpurposes or of any analogous group of corporation, or combined, consolidated or unitary group oftaxpayers, under the rules of any other taxing jurisdiction; and     2.1.66 No taxing jurisdiction in which CHI has not filed Tax Returns has asserted that CHI isrequired either to file such Tax Returns or to pay Taxes.     2.1.67 **Schedule 2.1.67**sets forth the balance of CHI’s net operating loss carryforwards,capital loss carryforwards, and credit carryforwards, and the last date on which each such taxattribute may be used, as of the close of the last taxable year ending prior to the date hereof.     **Relationships with Related Parties**     2.1.68 Except as set forth on **Schedule 2.1.68**, no Majority Shareholder nor any Affiliate of aMajority Shareholder or of CHI has, or since September 30, 2004 has had, any interest in anyproperty (whether real, personal, or mixed and whether tangible or intangible), used in orpertaining to CHI’s business; no Majority Shareholder nor any Affiliate of a Majority Shareholderor of CHI is, or since September 30, 2004 has owned (of record or as a beneficial owner) an equityinterest or any other financial or profit interest in, a Person that has engaged in any work oractivity for or with, or have any financial interest in, any business materially in competitionwith, or which may materially compete with the Business of CHI within any country, state, region,or locality in which CHI or such affiliate is or was at that time then doing business or marketingits products. For purposes of this Agreement, the “**Business of CHI**”, (includes any affiliate)means the provision of research and development services and tools to Federal Government agenciesresponsible for national defense, homeland defense, and healthcare clinical information management– specifically, in areas relating to training systems, cognitive engineering, decision supportsystems, and command, control, communications, computing, intelligence, surveillance, andreconnaissance (C4ISR) systems business dealings, and a material financial interest in anytransaction with CHI, but shall not include ownership for investment purposes of less than twopercent of any class of securities of a publicly held corporation.
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Except as set forth on **Schedule 2.1.68**, no Affiliate of a Majority Shareholder or of CHI is aparty to any contract with, or has any claim or right against, CHI;     **Condition of Assets**     2.1.69 All material assets and all other material plant, machinery, facilities, computerhardware, computer software, and equipment used by CHI in connection with its business are in goodoperating condition and in a good state of maintenance and repair for equipment of similar agerelative to the standards of maintenance and repair maintained by those carrying on similarbusinesses in the jurisdictions in which such assets are located;     **Undisclosed Information**     2.1.70 None of the Majority Shareholders has any specific information relating to CHI that isnot generally known or that has not been disclosed to OSIL which would have any material adverseeffect on the value of the CHI Shares or CHI’s business;     **Warranty Claims**     2.1.71 There are no material existing or threatened claims or, to the best of the knowledge ofSellers, any facts or state of affairs, upon which any claim could be based against CHI for breachof any express or implied warranty or contract requirement or negligence with respect to any work,services or products partially or wholly performed, produced or sold by CHI prior to the ClosingDate;     **Bid and Performance Bonds and Guarantees**     2.1.72 There are no specific outstanding bid and performance bonds, letters of credit,agreements of guarantee and agreements of indemnification made in favour of any Person with respectto any work, services or products performed, produced or sold by CHI;     **Bank Accounts and Business Numbers**     2.1.73 **Schedule 2.1.73**is a true and complete list showing the name of each bank, trustcompany or similar institution in which CHI has accounts or safe deposit boxes, the identificationnumbers of each such account or safe deposit box, the names of all Persons authorized to drawthereon or to have access thereto and the number of signatories required on each account, and allcredit cards numbers, non-bank account numbers, codes, and business numbers used by CHI forpurposes of remitting Taxes, dues, assessments or other fees;     **Environmental Matters**     2.1.74 Except as set forth in **Schedule 2.1.74**, to the knowledge of each Majority Shareholder:          (a) CHI’s operation of the business and the Real Property comply in all
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material respects with applicable Environmental Laws;          (b) there has been no Treatment, Storage or Disposal by CHI or any of its Affiliates of anyHazardous Material at, on, under or from any of the Real Property or any real property that wasowned, leased or operated by CHI prior to the date hereof which could reasonably be expected toresult in liability under applicable Environmental Laws;          (c) there has been no Release by CHI or any of its Affiliates of any Hazardous Material at,on, under or from any of the Real Property or any real property that was owned, leased or operatedby CHI prior to the date hereof in an amount or concentration that could reasonably be expected togive rise to any legal requirement to perform any investigation, clean-up, removal, response orother remedial action, pursuant to any Environmental Law;          (d) there has been no arrangement by CHI or any of its Affiliates for Disposal or Treatment ortransport for Disposal or Treatment of any Hazardous Material at or to any off-site facility whichcould reasonably be expected to result in liability under applicable Environmental Laws;          (e) neither CHI nor any of its Affiliates has been named in any suit or proceeding concerning,and has not received any written or, to the knowledge of the Majority Shareholders, oral, notice orrequest for information from any third party with respect to, a Release or threatened Release ofany Hazardous Material or of a violation or alleged violation of any Environmental Law;          (f) there are no underground storage tanks or related piping, or surface impoundments locatedon, under or at any of the Real Property. Neither Majority Shareholders nor CHI or any of itsAffiliates has removed or caused any such tank or piping to be removed from any Real Property;          (g) Majority Shareholders have made available to OSIL any documents, reports, assessments orcorrespondence in the possession or control of the Majority Shareholders or CHI or any of itsAffiliates concerning CHI’s liabilities under or compliance with the Environmental Laws.     **Security Clearances**     2.1.75 CHI holds all Facility Security Clearances and its employees hold all PersonnelSecurity Clearances necessary to provide its services to its customers under the MaterialContracts;     **Confidentiality Agreements**     2.1.76 Except as disclosed in **Section 2.1.77**or except as set forth on **Schedule 2.1.76**, CHI isnot a party to any confidentiality agreement with any Person (other than OSIL under that certainConfidentiality Agreement dated as of June 29, 2005 (the “**Confidentiality Agreement**”)) respectingthe confidentiality of information provided to such Persons or
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reviewed by such Persons;     **Restrictions on Business**     2.1.77 Except as set forth on **Schedule 2.1.77**, there is no non-competition, exclusivity orother similar agreement, commitment or understanding in place to which CHI is a party or to whichit is otherwise bound that would now or hereafter in anyway limit its business or operations in aparticular manner or to a particular locality or geographic region or for a specified period oftime, and the execution, delivery and performance of this Agreement does not and will not result inany restriction of CHI from engaging in its business or from competing with any Person or in anygeographic area;     **Undisclosed Liabilities**     2.1.78 Except as set forth on **Schedule 2.1.78**, since October 1, 2004, CHI has not, incurredany liabilities that are of a nature that would be required to be disclosed on a balance sheet ofCHI prepared in conformity with GAAP, including the footnotes thereto, other than (a) liabilitiesunder this Agreement relating to or in connection with the transactions contemplated hereby, or (b)liabilities incurred in the ordinary course of business; and     **Certain Payments**     2.1.79 The Majority Shareholders have not, and to the best of the Majority Shareholders’knowledge, since its inception, neither CHI nor any director, officer, agent, representative oremployee of CHI, or any other Person associated with or acting for or on behalf of CHI, hasdirectly or indirectly (a) made any contribution, gift, bribe, rebate, payoff, influence payment,kickback, or other payment to any Person, private or public, regardless of form, whether in money,property, or services (i) to obtain favourable treatment in securing business, (ii) to pay forfavourable treatment for business secured, (iii) to obtain special concessions or for specialconcessions already obtained, for or in respect of CHI or any Affiliate of CHI, or (iv) inviolation of any Law, or (b) established or maintained any fund or asset that has not been recordedin the books and records of CHI.**Representations and Warranties of All Sellers**2.2 In order to induce OSIL and Newco to enter into and consummate the transactions contemplated bythis Agreement, each Seller severally, and not jointly and severally, represents and warrants toOSIL and Newco that, except as otherwise specified herein or in specified in the relevant Schedule:     **Title to Shares**     2.2.1 Such Seller is the registered and beneficial owner of and has good and marketable titleto all of the CHI Shares and, if applicable, the CHI Options held by him or her as set forthopposite his or her name in **Schedule 2.1.5**and holds such CHI Shares and CHI Options free and clearof any and all Encumbrances whatsoever;
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     **Voting Trust**     2.2.2 None of such Seller’s CHI Shares is subject to any voting trust agreement or othercontract, agreement, arrangement, commitment or understanding, including any such agreement,arrangement, commitment or understanding restricting or otherwise relating to the voting, dividendrates or disposition of the CHI Shares other than the Shareholders’ Agreement;     **Authority**     2.2.3 Such Seller has due and sufficient right and authority to enter into this Agreement onthe terms and conditions set forth herein and to transfer the registered, legal and beneficialtitle and ownership of his or her CHI Shares to OSIL free and clear of any and all Encumbrances**;**     **Residency of the Sellers**     2.2.4 Such Seller is a resident of the State set out under his or her name in **Schedule 2.1.5**;     **Agreement Valid**     2.2.5 This Agreement has been duly executed by such Seller and constitutes a legal, valid andbinding obligation of such Seller enforceable against each Seller in accordance with its terms,except as enforceability may be restricted, limited or delayed by applicable bankruptcy or otherlaws affecting creditors’ rights generally and except as enforceability may be subject to generalprinciples of equity; and     **No Conflicts**     2.2.6 Such Seller is not a party to, bound by or subject to any indenture, mortgage, lease,agreement, instrument, statute, regulation, order, judgement, decree or law which would beviolated, contravened or breached by or under which any default would occur as a result of theexecution and delivery by such Seller of this Agreement or the performance by such Seller of any ofthe terms hereof.     **Investment Representation**     2.2.7 Each Seller who is acquiring OSIL Shares is acquiring the OSIL Shares solely for his orher own account, for investment purposes only, and not with a view to, or with any presentintention of, reselling or otherwise distributing the OSIL Shares or dividing his or herparticipation herein with others. Such Seller has sufficient experience in business, financial andinvestment matters to be able to evaluate the purchase of the OSIL Shares and to make an informedinvestment decision with respect to such purchase. Such Seller is an “accredited investor” withinthe meaning of Rule 501 promulgated under the Securities Act of 1933, as amended (the “**1933 Act**”).Such Seller understands and acknowledges that (a) none of the OSIL
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Shares have been registered or qualified under the 1933 Act, or under any securities Laws ofany state of the United States or other jurisdiction, in reliance upon specific exemptionsthereunder for transactions not involving any public offering; (b) all of the OSIL Sharesconstitute “restricted securities” as defined in Rule 144 under the 1933 Act; and (c) none of theOSIL Shares may be sold, transferred or otherwise disposed of unless a registration statement underthe 1933 Act with respect to such OSIL Shares and qualification in accordance with any applicablestate securities Laws becomes effective or unless such registration and qualification isinapplicable, or an exemption therefrom is available. Such Seller will refrain from transferring orotherwise disposing of any of the OSIL Shares acquired hereunder or any interest therein in anymanner that may cause any Seller to be in violation of the 1933 Act or any applicable statesecurities Laws. Notwithstanding the foregoing, the parties agree and acknowledge that therepresentations contained in this **Section 2.2.7**shall in no way affect the liability of MajorityShareholders for breaches of their representations and warranties.**Correct on Closing Date**2.3 Each of the Sellers severally, and not jointly and severally, covenants, represents andwarrants to and in favour of and with OSIL and Newco that all of the representations and warrantiesof such Seller set forth in **Sections 2.1**and **2.2**, in each case those that are qualified as tomateriality shall be true and correct and those that are not qualified as to materiality shall betrue and correct in all material respects at the Closing Date as if made on that date.**Survival of the Sellers’ Warranties**2.4 The representations, warranties and covenants of the Sellers contained in this Agreement orcontained in any document or certificate given pursuant hereto will survive the Closing and,notwithstanding the Closing, will continue in full force and effect for the benefit of OSIL andNewco, provided that:     2.4.1 Except as provided in **Sections 2.4.2**and **2.4.3**, no claim based upon or with respect tothe inaccuracy or non-performance or non-fulfilment or breach of any representation or warranty ofthe Sellers contained herein may be made or brought by OSIL and Newco or either of them after theexpiration of twenty-four months after the Closing Date unless OSIL has given written notice to theSellers of particulars of the basis of such claim within such period;     2.4.2 Any claims based upon or with respect to the inaccuracy or non-performance ornon-fulfilment or breach of any representation or warranty of the Majority Shareholders containedherein may, if such claim is based upon or relates to the liability of CHI for Taxes for aparticular taxation year, be made or brought by OSIL and Newco or either of them at any time up tothe date which is six months following the expiry date, if any, of any period during which anassessment, reassessment or other form of recognized document assessing liability for Taxes,interest and/or penalties in respect of such taxation year under the applicable tax legislationcould be issued; and     2.4.3 Any claims based upon or with respect to the inaccuracy or non-performance ornon-fulfilment or breach of any representation or warranty of any Seller contained herein may, if
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such claim is based upon or relates to the right, title and ownership of such Seller to suchSeller’s CHI Shares, the authorized and issued capital of CHI and the entitlement of any otherPerson to acquire any of the CHI Shares or acquire any shares from the treasury of CHI, or is basedon fraud or fraudulent misrepresentation, be made or brought by OSIL and Newco or either of them atany time subject only to any limitation periods as may be imposed by applicable laws.**Reliance**2.5 The Sellers and CHI acknowledge and agree that OSIL and Newco have entered into this Agreementin reliance on the warranties and representations and other terms and conditions of this Agreement,notwithstanding any independent searches or investigations that may be undertaken by or on behalfof OSIL and Newco and that no information known to OSIL and or their respective officers, directorsor professional advisers will limit or extinguish OSIL’s right to indemnification hereunder.**PART 3****REPRESENTATIONS AND WARRANTIES OF OSIL****Representations and Warranties**3.1 In order to induce the Sellers to enter into and to consummate the transactions contemplated bythis Agreement, each of OSIL and Newco hereby severally, and not jointly and severally, representsand warrants to the Sellers that as of the date hereof:     **Organization and Good Standing of OSIL and Newco**     3.1.1 OSIL is duly organized and validly existing under the laws of the Province of BritishColumbia and is in good standing with respect to its filings required by the *Business CorporationsAct*(British Columbia) and has all necessary corporate power, authority and capacity to own itsassets and to carry on its business as presently conducted; and OSIL has all necessary corporatepower, authority and capacity to enter into this Agreement; Newco is duly incorporated and validlyexisting under the laws of the state of Delaware and is in good standing in the State of Delaware;Newco has not previously carried on any business and has no assets and no liabilities; and Newcohas all necessary corporate power, authority and capacity to enter into this Agreement;     **Agreement Valid**     3.1.2 This Agreement constitutes a valid and binding obligation of OSIL and Newco;     **No Conflicting Agreements**     3.1.3 Upon the execution of this Agreement and at the Closing, neither OSIL nor Newco will bea party to, be bound by or be subject to any indenture, mortgage, lease, agreement, instrument,statute, regulation, order, judgement, decree or law which would be
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violated, contravened or breached by or under which any default would occur as a result of theexecution and delivery by OSIL and Newco of this Agreement or the performance by OSIL and Newco ofany of the terms hereof;     **Approvals Required**     3.1.4 Except as otherwise provided herein no authorization, approval, order, license, permitor consent of any Governmental Authority, regulatory body or court, and no registration,declaration or filing by OSIL or Newco with any such Governmental Authority, regulatory body orcourt is required in order:          (a) For OSIL and Newco to incur the obligations expressed to be incurred by OSIL and Newcopursuant to this Agreement;          (b) for OSIL and Newco to execute and deliver all of the documents and instruments to bedelivered by OSIL and Newco pursuant to this Agreement;          (c) for OSIL and Newco to duly perform and observe the terms and provisions of this Agreement;or          (d) to render this Agreement legal, valid, binding and enforceable in accordance with itsterms;     **OSIL Financial Statements**     3.1.5 The financial statements of OSIL contained in the Public Record accurately reflect thefinancial position of OSIL as at their respective dates, and since the date of OSIL’s lastfinancial statements contained in the Public Record, except as set forth in the Public Record or on**Schedule 3.1.5**hereto, (i) no material adverse changes in the financial position of OSIL have takenplace, (ii) OSIL has not incurred any liabilities (contingent or otherwise) other than (X)liabilities incurred in the ordinary course of business consistent with past practice and (Y)liabilities not required to be reflected in OSIL’s financial statements pursuant to GAAP orotherwise required to be disclosed in Public Record, (iii) OSIL has not altered its method ofaccounting or the identity of its auditors, and (iv) OSIL has not declared or made any payment ordistribution of cash or other property to its stockholders or officers or directors (other than incompliance with existing OSIL stock option or stock purchase plans or the terms of any convertibleor derivative securities of OSIL) with respect to its capital stock, or purchased or redeemed (ormade any agreements to purchase or redeem) any shares of its capital stock;     **Filings**     3.1.6 OSIL has timely filed all documents that it is required to file pursuant to theApplicable Securities Laws and all of the documents so filed as part of the Public Record comply inall material respects with the requirements of the Applicable Securities Laws and contain no untruestatements of a material fact and do not omit to state a material fact that is required to bestated or that is necessary to prevent a statement that is made from being false or misleading in
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the circumstances in which it was made;     **Listing and Maintenance Requirements Compliance**     3.1.7 Except as set forth in the Public Record, OSIL has not, in the twelve (12) monthspreceding the date hereof, received notice (written or oral) from any securities market, quotationsystem or exchange on which OSIL’s common stock is trading to the effect that OSIL is not incompliance with the listing or maintenance requirements of such exchange or market;     **Registration Rights; Rights of Participation**     3.1.8 Except as set forth in **Section 9.11**and the Public Record, OSIL has not granted oragreed to grant to any Person any rights (including “piggy-back” registration rights) to have anysecurities of OSIL registered with any Governmental Authority which would grant any Person anyright of first refusal, preemptive right, right of participation, or any similar right toparticipate in the issuance, and/or registration of the sale of, the OSIL Shares contemplated bythis Agreement.     **OSIL Shares**     3.1.9 The OSIL Shares to be issued to the Sellers on Closing under this Agreement will, atClosing, be issued as fully paid and non-assessable shares, free of any Encumbrance.     **No Violation of Charter Documents**     3.1.10 The execution, delivery and performance of this Agreement by either OSIL or Newco willnot (with or without notice or lapse of time) violate any provision of their respective articles ofincorporation or bylaws;     **Undisclosed Information**     3.1.11 Neither OSIL nor Newco has any specific information relating to OSIL or Newco that isnot generally known or that has not been disclosed or made available to the Majority Shareholderswhich would have any material adverse effect on the value of the OSIL Shares or OSIL’s business;     **Private Offering**     3.1.12 Assuming that each Seller receiving OSIL Shares is an “accredited investor” as suchterm is defined in Regulation D under the 1933 Act and that the offer and sale of the OSIL Shareshas been completed, the offer, issuance and sale of the OSIL Shares to the Sellers as contemplatedhereby are exempt from the registration requirements of the 1933 Act. Neither OSIL nor any Personacting on its behalf has taken or is, to the knowledge of OSIL, contemplating taking any actionwhich could subject the offering, issuance or sale of the OSIL Shares to the Sellers to theregistration requirements of the 1933 Act, including soliciting any offer to buy or sell the OSILShares by means of any form of general solicitation or advertising.
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     **Authorized and Issued Capital**     3.1.13 The authorized capital of OSIL and Newco are set forth on **Schedule 3.1.13**;     **Certain Payments; FCPA**     3.1.14 To the best of knowledge of OSIL and Newco, since their inception, neither OSIL, Newco,any subsidiary thereof nor any director, officer, agent, representative or employee of OSIL, Newcoor any subsidiary thereof, or any other Person associated with or acting for or on behalf of OSIL,Newco or any subsidiary thereof, has directly or indirectly (a) made any contribution, gift, bribe,rebate, payoff, influence payment, kickback, or other payment to any Person, private or public,regardless of form, whether in money, property, or services (i) to obtain favourable treatment insecuring business, (ii) to pay for favourable treatment for business secured, (iii) to obtainspecial concessions or for special concessions already obtained, for or in respect of OSIL, Newco,any subsidiary thereof or any Affiliate of any of the foregoing, or (iv) in violation of any Law,(b) established or maintained any fund or asset that has not been recorded in the books and recordsof OSIL or Newco, or (c) violated the FCPA;     **Right of First Refusal; Stockholders’ Agreement; Voting and Registration Rights**     3.1.15 Except as set forth in the Public Record or on **Schedule 3.1.15**, no party has any rightof first refusal, right of first offer, right of co-sale, preemptive right or other similar rightregarding OSIL’s securities. The issuance of the OSIL Shares is not subject to any of the rightsset forth on **Schedule 3.1.15**. There are no provisions of OSIL’s notice of articles or articles, noagreements to which OSIL is a party and no agreements by which OSIL no any subsidiary or the OSILShares are bound, which (a) may affect or restrict the voting rights of any Seller with respect tothe OSIL Shares in its capacity as a stockholder of OSIL, (b) restrict the ability of the Seller,or any successor thereto or assignee or transferee thereof, to transfer the OSIL Shares, (c) wouldadversely affect any Seller’s right or ability to consummate this Agreement or comply with thetransactions contemplated hereby, (d) require the vote of more than a majority of OSIL’s issued andoutstanding common stock, voting together as a single class, to take or prevent any corporateaction, other than those matters requiring a class vote under applicable Law, or (e) entitle anyparty to nominate or elect any director of OSIL or require any of OSIL’s stockholders to vote forany such nominee or other person as a director of OSIL;     **Patents and Trademarks**     3.1.16 (a) OSIL, Newco and each subsidiary thereof have, or have rights to use, all patents,patent applications, trademarks, trademark applications, service marks, trade names, copyrights,licenses and rights which are necessary or material for use in connection with their respectivebusiness and which the failure to so have would have a material adverse effect (collectively, the“**OSIL Intellectual Property**”); and (b) there are no judgments, decrees or orders restricting orlimiting the use by OSIL, Newco or any subsidiary thereof of OSIL Intellectual Property and theoperation of the business of OSIL, Newco and any subsidiary thereof does not violate, breach orinfringe any patents, copyrights, trade names, trademarks,
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industrial designs or licenses held by others;      **Certain Fees**      3.1.17 No fees or commissions will be payable by OSIL or Newco to any broker, financialadvisor or consultant, finder, placement agent, investment banker, bank or other Person withrespect to the transactions contemplated by this Agreement;      **Employees**      3.1.19 The total number of employees of OSIL, Newco and any subsidiary thereof in theaggregate is less than 200;      **Permits and Licences**      3.1.20 To best of the knowledge of OSIL and Newco, OSIL and Newco hold all permits, licenses,consents, registrations and authorizations issued by any Governmental Authority, that are necessaryin connection with the conduct and operation of their business, and the ownership or leasing oftheir assets as they are now owned, leased, conducted or operated and are not, in any materialrespect, in breach of or in default under any term or condition of any thereof;      **Correct on Closing**      3.2 Each of OSIL and Newco severally, and not jointly and severally, covenants, represents andwarrants with and in favour of each of the Sellers that all of the representations and warrantiesset forth in **Section 3.1**will be true and correct at the Closing Date as if made on that date.      **Survival of OSIL’s and Newco’s Warranties**      3.3 The representations, warranties and covenants of OSIL and Newco contained in this Agreement orin any document or certificate given pursuant hereto will survive the Closing and, notwithstandingthe Closing and any investigation made by or on behalf of the Majority Shareholders, will continuein full force and effect for the benefit of the Sellers, provided that no claim based upon or withrespect to the inaccuracy or non-performance or non-fulfilment or breach of any representation orwarranty of OSIL contained herein may be made or brought by the Majority Shareholders after theexpiration of twenty-four months from the Closing Date unless the Sellers have given written noticeto OSIL of particulars of the basis of such claim within such period.      **Reliance**      3.4 OSIL and Newco acknowledge and agree that the Sellers have entered into this Agreement inreliance on the warranties and representations and other terms and conditions of this Agreementnotwithstanding any independent searches or investigations that may be undertaken by or on behalfof the Sellers and that no information which is known to any of the Sellers and CHI or theirprofessional advisers will limit or extinguish the right to indemnification
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hereunder.**PART 4****PURCHASE AND SALE OF CHI SHARES****Purchase and Sale**4.1 Subject to the conditions, representations and warranties contained in this Agreement, theSellers shall sell and OSIL and Newco shall purchase the CHI Shares free and clear of allEncumbrances.**Purchase Price**4.2 The aggregate purchase price payable to the Sellers for the CHI Shares shall be the sum of$9,000,000 subject to payment and adjustment as set forth in this **Part 4**(as adjusted from time totime, the “**Purchase Price**”).**Manner and Terms of Payment**4.3 The Purchase Price will be paid as follows:     4.3.1 $7,250,000 on account of the Purchase Price be paid on Closing by Newco to the Sellersby way of certified trust cheque, bank draft, or such other method as may be acceptable to Sellersand OSIL, acting reasonably, in the proportions set forth on **Schedule 4.3.1**;     4.3.2 $750,000 on account of the Purchase Price (the **“Holdback”**) will be delivered on Closingto an escrow agent mutually acceptable to OSIL and Sellers’ Representative, acting reasonably, andwill be held in escrow for a period of 90 days following Closing pending the making of finaladjustments to the Purchase Price as follows:          (a) OSIL and Newco will engage OSIL’s auditors to prepare an audited balance sheet of CHI(“**Closing Balance Sheet**”) in accordance with GAAP consistent with CHI’s past practices as of theClosing Date setting forth CHI’s retained earnings as of the Closing Date (“**Retained Earnings**”) andthe amount by which such Retained Earnings exceed the Retained Earnings Threshold (the “**RetainedEarnings Surplus**”) or the amount by which such Retained Earnings are less than the RetainedEarnings Threshold (the “**Retained Earnings Deficiency**”). Funds paid to CHI pursuant to theexercise of the CHI Options pursuant to **Section 9.7**shall be excluded from, and shall not beincluded in, the calculation of Retained Earnings, Retained Earnings Surplus or Retained EarningsDeficiency. OSIL and Newco will deliver to Sellers’ Representative the Closing Balance Sheet notlater than the Settlement Date;               (i) If Sellers’ Representative does not object to the Closing Balance Sheet, then the ClosingBalance Sheet shall be treated as the final Closing Balance Sheet.               (ii) If Sellers’ Representative objects to the Closing Balance Sheet, he shall deliver adetailed statement (“**Objections**”) describing his objections to OSIL within 30
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days after receiving the Closing Balance Sheet and setting forth the Sellers’ calculations andamounts for the Retained Earnings. OSIL and Sellers’ Representative will use reasonable efforts toresolve any such Objections themselves, and if the parties obtain a final resolution, OSIL willrevise the Closing Balance Sheet as appropriate to reflect the resolution of any Objections theretopursuant to this **Section 4.3.2(a)(ii)**, and such revised balance sheet shall be treated as the finalClosing Balance Sheet.               (iii) If OSIL and Sellers’ Representative do not obtain a final resolution within thirty (30)days after OSIL has received the Objections, OSIL and Sellers’ Representative will select anaccounting firm mutually acceptable to them to resolve any remaining Objections. If OSIL andSellers’ Representative are unable to agree on the choice of an accounting firm, they will select anationally recognized accounting firm by lot (after excluding their respective regular outsideaccounting firms). The determination of any accounting firm so selected will be set forth inwriting, will set forth the accounting firm’s calculations and amounts for Retained Earnings andwill be conclusive and binding upon the Parties. OSIL will revise the Closing Balance Sheet asappropriate to reflect the resolution of any Objections thereto pursuant to this **Section4.3.****2(a)(iii)**, and such revised balance sheet shall be treated as the final Closing Balance Sheet.               (iv) In the event the Purchaser and Sellers’ Representative submit any unresolved Objectionsto an accounting firm for resolution as provided in **Section 4.3.****2(a)(iii)** above, if the accountingfirm’s calculation of Retained Earnings is closer in value to:                    (Y) the Sellers’ calculation of Retained Earnings as set forth in the Objections than toOSIL’s calculation of Retained Earnings as set forth in the Closing Balance Sheet delivered by OSILto Sellers’ Representative under **Section 4.3.2(a)**, then OSIL will be responsible for all of thefees and expenses of the accounting firm; or                    (Z) OSIL’s calculation of Retained Earnings as set forth in the Closing Balance Sheetdelivered by OSIL to Sellers’ Representative under **Section 4.3.****2(a)** than to Sellers’Representative’s calculation as set forth in the Objections, then Sellers will be responsible forall of the fees and expenses of the accounting firm.               (v) OSIL and Newco will make the work papers and back up materials used in preparing theClosing Balance Sheet available to Sellers’ Representative and Sellers’ accountants and otherrepresentatives at reasonable times and upon reasonable notice at any time during the review andpreparation by OSIL of the Closing Balance Sheet; and          (b) Within fourteen days after Closing, CHI shall deliver a listing of each of CHI’s accountsreceivable as of the Closing Date (the “**Accounts Receivable**”) which shall be attached hereto as**Schedule 4.3.2(b)**. For the avoidance of doubt, “Accounts Receivable” shall not include the amountof holdbacks under government contracts identified as “Government Contract Holdbacks” on **Schedule4.3.2(b)**, and the Purchase Price shall not be adjusted for the non-collection of such GovernmentContract Holdbacks. Following the Closing Date, OSIL and Newco shall cause CHI to use commerciallyreasonable efforts to collect the Accounts Receivable. On the Settlement Date, OSIL and Newcoshall deliver to the Sellers’ Representative a report (the “**AR Report**”) setting forth the amount ofeach Account Receivable that has not been collected (the aggregate total of such amounts, the “**ARDeficiency**”). Following delivery of the AR Report, the Sellers’ Representative shall have a periodof ten (10) Business Days from his receipt thereof in which to review the same. For the purpose ofsuch
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review, OSIL and Newco agree to permit or to cause their accountants to permit the Sellers’Representative and his accountants to examine all invoices, records, working papers, schedules andother documentation related to the Accounts Receivable. In the event of any discrepancy betweenamounts paid by such payors with respect to the Accounts Receivable and amounts reflected in the ARReport, the Sellers’ Representative may dispute such discrepancy and OSIL and Sellers’Representative agree to work diligently to resolve such discrepancy within ten (10) Business Days.OSIL agrees to promptly revise and prepare a final AR Report to reflect the agreement of OSIL andSellers’ Representative with respect to the collected Accounts Receivable. If Sellers’Representative does not dispute the initial AR Report, then such report shall be treated as thefinal AR Report.          (c) If there is a Retained Earnings Surplus which exceeds the AR Deficiency, if any, thePurchase Price shall not be adjusted, and the escrow agent shall be directed to pay to the Sellers’Representative for the benefit of the Sellers on the Settlement Date the entire Holdback.          (d) If there is a Retained Earnings Surplus which is less than the AR Deficiency, the escrowagent shall be directed to pay to the Sellers’ Representative for the benefit of the Sellers on theSettlement Date the Holdback minus the difference between the AR Deficiency minus the RetainedEarnings Surplus, and the Purchase Price shall be deemed adjusted accordingly. The parties shallthen resolve any disputes pursuant to the dispute resolution proceedings set forth in **Section4.3.2(a)-(b)**to determine the final Retained Earnings Surplus and AR Deficiency. Upon completingthe dispute resolution proceedings, the escrow agent shall pay to OSIL and Newco an amount equal tothe difference of the final AR Deficiency minus the final Retained Earnings Surplus and shall paythe remaining Holdback amount, if any, to the Sellers’ Representative for the benefit of theSellers. Thereafter, OSIL and Newco will continue to cause CHI to use its commercially reasonableefforts to collect the remaining Accounts Receivable and will pay to Sellers’ Representative forthe benefit of the Sellers, as and when collected, an amount equal to the difference of the finalAR Deficiency minus the final Retained Earnings Surplus.          (e) If there is a Retained Earnings Deficiency, then the escrow agent shall be directed to payto the Sellers’ Representative for the benefit of the Sellers on the Settlement Date the Holdbackminus any AR Deficiency and minus any Retained Earnings Deficiency, and the Purchase Price shall bedeemed adjusted accordingly. Thereafter, the parties shall resolve any disputes pursuant to thedispute resolution proceedings set forth in **Section 4.3.2(a)-(b)**to determine the final RetainedEarnings Deficiency or Retained Earnings Surplus, as the case may be, and AR Deficiency. Uponcompleting the dispute resolution proceedings, the escrow agent shall pay to OSIL and Newco anamount equal to the final AR Deficiency plus the final Retained Earnings Deficiency and shall paythe remaining Holdback amount, if any, to the Sellers’ Representative for the benefit of theSellers. Thereafter, OSIL and Newco will cause CHI to continue to use its commercially reasonableefforts to collect the remaining Accounts Receivable and will cause CHI to pay the same to Sellers’Representative for the benefit of the Sellers, as and when collected.          (f) If, after completing the dispute resolution proceedings set forth in **Section 4.3.2(a)**-**(b)**,the final Retained Earnings Deficiency and AR Deficiency exceed the Holdback,
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the Sellers shall remit such amount to OSIL promptly upon receipt of notice from OSIL requestingpayment therefor, and the Purchase Price shall be deemed adjusted accordingly. Thereafter, OSILand Newco will continue to cause CHI to use its commercially reasonable efforts to collect theremaining Accounts Receivable and will cause CHI to pay the same to Sellers’ Representative for thebenefit of the Sellers, as and when collected, but only if and to the extent that the amounts socollected exceed the amount by which the final AR Deficiency plus the final Retained EarningsDeficiency exceed the Holdback;.          (g) All cash payments to the Sellers pursuant to this **Section 4.3.2**shall be paid inproportion to their percentage ownership of CHI Shares on Closing, as set forth on **Schedule 4.3.1**.     4.3.3 The provisions of **Sections 4.3.2**shall be embodied in a formal escrow agreementsubstantially in the form of **Schedule 4.3.3**, which shall be executed and delivered on Closing.     4.3.4 (a) The sum of $898,220 will be paid and satisfied by the issue on Closing by OSIL tothose Sellers identified on **Schedule 4.3.****4(a)** of 1,067,975 fully paid and non-assessable commonvoting shares without par value in the capital stock of OSIL (the “**OSIL Shares**”), in the amountsset forth on **Schedule 4.3.****4(a)** hereto.          (b) The Sellers identified on **Schedule 4.3.4(b)**hereto either do not meet the definition of“accredited investor” or have elected to receive cash in lieu of OSIL Shares to which they wouldotherwise be entitled under **Section 4.3.4(a)**. The sum of $101,780 will be paid and satisfied bythe issue on Closing by OSIL to those Sellers identified on **Schedule 4.3.4(b)**in the amounts setforth on **Schedule 4.3.4(b)**hereto.     4.3.5 OSIL covenants with the Sellers that OSIL will provide the necessary funds to Newco toenable Newco to pay and satisfy the cash portion of the Purchase Price on Closing.     4.3.6 The Sellers acknowledge and agree that OSIL and Newco shall have the right to adjust theproportion of the consideration paid by each of them to the Sellers for the CHI Shares as OSIL maydetermine, acting reasonably, in its discretion.     4.3.7 OSIL and Newco agree that CHI may pay costs incurred by the Sellers in connection withthis Agreement and the transactions evidenced hereby in the amount of up to $75,000. Such paymentshall be included in the calculation of Retained Earnings.**TSX Acceptance**4.4 The Parties acknowledge that the transactions contemplated hereby shall be subject to theacceptance of the TSX and all other regulatory authorities having jurisdiction. Without limitingthe generality of the foregoing, the Parties acknowledge that the number and deemed price of theOSIL Shares to be issued to the Sellers is subject to TSX approval. OSIL agrees that promptly uponexecution of this Agreement, it shall make application to the TSX and use its reasonable efforts toobtain such approval as soon as reasonably practicable. The Majority Shareholders and CHI agree tocooperate with OSIL and provide all such information and documentation as the TSX may reasonablyrequest in support of OSIL application for approval.
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**Securities Laws**4.5 The Sellers and CHI acknowledge that OSIL intends to deliver the OSIL Shares to the Sellers inreliance upon exemptions from the registration and prospectus requirements of Applicable SecuritiesLaws, and that accordingly the OSIL Shares will be issued subject to such trading restrictions,escrow arrangements and hold periods as may be imposed under Applicable Securities Laws. TheSellers and CHI further acknowledge that, except as otherwise set forth herein, OSIL has noobligation to qualify the distribution of the OSIL Shares by way of prospectus or a registrationstatement in any jurisdiction.**PART 5****CLOSING****Closing Time and Location**5.1 The Closing will take place on November 30, 2005 at 10:00 a.m. Eastern Time (the “**ClosingDate**”) at the offices of Schnader Harrison Segal & Lewis LLP at 1600 Market Street, Suite 3600,Philadelphia, Pennsylvania, or such other date, time and place as is agreed upon in writing by OSILand the Sellers’ Representative, subject to satisfaction or waiver of all of the conditionsprecedent to closing set forth herein. Notwithstanding the Closing Date, all adjustments shall bemade as of the Adjustment Time.**Sellers’ Closing Documents**5.3 At the Closing, the Sellers (through the Seller’s Representative), and CHI will deliver, orcause to be delivered, to OSIL the closing documents set forth in **Section 6.1**.**OSIL’s and Newco’s Closing Documents**5.4 At the Closing, OSIL and Newco will deliver to the Sellers the documents set forth in **Section7.1**.**PART 6****CONDITIONS PRECEDENT TO PERFORMANCE BY OSIL AND NEWCO**