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Exhibit 4.2  

 
 

REGISTRATION RIGHTS AGREEMENT    
    

        THIS REGISTRATION RIGHTS AGREEMENT, dated as of December 27, 2001, is among Hostopia.com, Inc., a Delaware corporation (the "Company"), and the
persons listed on Schedule A attached hereto (the "Purchasers"). 

        The
Company and the Purchasers have entered into arrangements ("Arrangements") for sale by the Company and purchase by the Purchasers of the Company's Series A Preferred Shares,
$0.001 par value per share (the "Series A Preferred Shares"). 

        In
connection with the Arrangements, the Company and the Purchasers desire to provide for the rights of the Purchasers with respect to registration of the Common Stock issued upon
conversion of the Series A Preferred Shares according to the terms of this Agreement. 

        NOW
THEREFORE, in consideration of the foregoing and the covenants contained in this Agreement, the parties agree as follows: 

        Section
1.    Certain Definitions.    For purposes of this Agreement, the following terms
shall have the following respective meanings: 

        "1934
Act" shall mean the Securities and Exchange Act of 1934, as amended. 

        "Commission"
shall mean the Securities and Exchange Commission, or any other agency of the United States Government at the time administering the
Securities Act. 

        "Holders"
shall mean the Purchasers and their successors and permitted assigns as provided in Section 10. 

        "Registration
Expenses" shall mean the expenses so described in Section 5. 

        "Registrable
Shares" shall mean (a) the Common Stock issued upon conversion of the Series A Preferred Shares and (b) any Common Stock of
the Company issued or issuable with respect to such Common Stock by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or
other reorganization; provided that any shares of such Common Stock shall cease to be Registrable Shares when (i) they have been registered under the Securities Act, the registration statement
in connection therewith has been declared effective and they have been disposed of by Purchasers pursuant to such effective registration statement; (ii) they are disposed of pursuant to
Rule 144 (or any similar rule then in effect) under the Securities Act; (iii) they have been otherwise transferred and are not subject to any restriction on resale under the Securities
Act, or (iv) they have been held for such period and in such manner as to qualify for resale without restriction pursuant to Rule 144(k) (or any similar rule then in effect) under the
Securities Act. 

        "Securities
Act" shall mean the Securities Act of 1933, as amended. 

 

        "Selling
Expenses" shall mean the expenses so described in Section 5. 

        Section
2.    Demand Registration.    

        (a)   Commencing
on the date six months after the closing of the Company's initial public offering of Common Stock, upon receipt of a written request (the "Registration
Request"), which shall include a description of such Holders' proposed method of distribution (which method may also include an underwritten offering by a nationally recognized underwriter selected by
the Company and reasonably acceptable to the Registering Holders) from Holders holding Registrable Shares having an aggregate expected offering price of at least $1,000,000 (or, if the expected
offering price of all remaining Registrable Shares should be less than $1,000,000, such lesser amount), the Company shall (i) promptly give notice of the Registration Request to all
non-requesting Holders and (ii) prepare and file with the SEC a registration statement for the sale of all Registrable Shares held by the requesting Holders and any other Holder who makes a
written request of the Company to have her or his Registrable Shares included in such Registration Statement, which such written request must be received by the Company within ten (10) days
after such Holder receives the notice of the Registration Request (all of such Holders, collectively, the "Registering Holders"). The Company shall use all commercially reasonable efforts to effect
the registration under the Securities Act of such Registrable Shares in accordance with the intended method of distribution thereof. 

        (b)   The
Company shall not be required to effect more than three (3) registrations pursuant to this Section 2 and not more than one (1) such registration
within any nine month period. 

        (c)   Any
registration statement filed pursuant to a Registration Request may, subject to the provisions of Section 2(d), include securities of the Company other than
Registration Shares. 

        (d)   If
a registration pursuant to Section 2 is an underwritten offering and the managing underwriters advise the Company in writing that in their opinion the number
of Registrable Shares and, if permitted under this Agreement, other securities requested to be included in such offering exceeds the number of Registrable Shares and other securities, if any, that can
be sold in an orderly manner in such offering within a price range acceptable to the holders of a majority of the Registrable Shares initially requesting registration, the Company shall include in the
registration, prior to the inclusion of any securities which are not Registrable Shares, the number of Registrable Shares requested to be included which, in the written opinion of the underwriters,
can be sold in an orderly manner within the price range of the offering, pro rata among the respective Holders thereof on the basis of the amount of Registrable Shares owned by each such Holder
requesting inclusing in such registration (it being understood that such managing underwriters shall have the right to eliminate entirely the participation in such registration of any securities which
are not Registrable Shares). 

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        (e)   The
Company shall be entitled to postpone, for a reasonable period of time not in excess of ninety (90) days, the filing or effectiveness of a registration
statement if the Company determines, in the good faith exercise of its reasonable business judgment, as evidenced by a certificate signed by the President and CEO of the Company in a form reasonably
satisfactory to the Registering Holders, that such registration and offering could materially adversely affect the bonafide financing plans of the Company or would require the disclosure of
information, the premature disclosure of which could materially adversely affect the Company or any transaction under consideration by the Company; provided, however, that the Company shall not be
entitled to such postponement more than once in any 360-day period. 

        (f)    The
Company shall not be obligated to file a registration statement pursuant to this Section 2 if the Company, within ten (10) days of the receipt of the
Registration Request gives notice of its bona fide intention to effect the filing of a registration statement with the SEC within 90 days of receipt of such Registration Request (other than
with respect to a registration statement relating to a Rule 145 transaction or an offering solely to employees), provided that the Company is actively employing in good faith all commercially
reasonable efforts to cause such registration statement to become effective. 

        (g)   The
Company shall not be obligated to file a registration statement pursuant to this Section 2 within six (6) months immediately following the effective
date of any registration statement pertaining to the securities of the Company (other than a registration of securities in a Rule 145 transaction or with respect to an employee benefit plan). 

        (h)   The
Board of Directors of the Company may select the investment banker(s) and manager(s) to administer any offering initiated pursuant to this Section 2, subject
to the approval of the holders of a majority of the Registrable Shares initially requesting such registration. 

        Section
3.    PIGGYBACK REGISTRATION.    

        (a)   If
the Company proposes to file a registration statement in respect to any of its Common Stock (a "Primary Registration") on a form that may be used for the registration
of Registrable Shares, the Company shall promptly give written notice of such proposed filing to the Holders of Registrable Shares and such notice shall offer such Holders the opportunity to register
such number of shares of Registrable Shares as each such Holder may request within 10 days after receipt of such notice (a "Piggyback Registration"). The Company shall use all commercially
reasonable efforts to include or to cause the managing underwriter or underwriters of a proposed underwritten offering to permit the Registrable Shares requested to be included in a Piggyback
Registration to be included on the same terms and conditions as any similar securities of the Company included therein. 

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        (b)   Any Holder requesting inclusion of Registrable Shares pursuant to this Section 3 may, prior to the effective date of the Registration Statement relating to such
registration, revoke such request by delivering written notice of such revocation to the Company and the managing underwriter, if any, at least two (2) business day prior to the effective date of the
registration; provided, however, that if the Company, in consultation with its financial and legal advisors, determines that such revocation would materially delay the registration or otherwise
require a recirculation of the prospectus contained in the registration statement, then such Holder shall have no such right to revoke its request. If the withdrawal of any Registrable Shares would
allow, within the marketing limitations set forth above, the inclusion in the underwriting of a greater number of shares of Registrable Shares, then, to the extent practicable and without delaying the
underwriting, the Company shall offer to the Holders an opportunity to include additional shares of Registrable Shares, which additional Registrable Shares shall be included in such registration
pro rata among the holders of Registrable Shares requesting such registration and the Holders of such other Registrable Shares on the basis of the number of Registrable Shares requested for
inclusion in such registration by each such Holder. Any Registrable Shares excluded or withdrawn from such underwriting shall also be withdrawn from registration and shall not be transferred in a
public distribution prior to ninety (90) days after the effective date of the Registration Statement relating thereto, or such shorter period of time as the managing Underwriter may require. 

        (c)   The
Company shall have the right to delay, terminate or withdraw any registration initiated by it under this Section 3 prior to the effectiveness of such
registration whether or not any Holder has elected to include Shares in such registration. 

        (d)   If
a Piggyback Registration is an underwritten primary registration on behalf of the Company and the managing underwriters advise the Company in writing that in their
opinion the number of securities requested to be included in such registration exceeds the number that can be sold in an orderly manner in such offering within a price range acceptable to the Company,
the Company may reduce the number of shares included in such registration pursuant to this Section 3. If the number of shares included in such registration is so reduced, the Company shall
include shares in such registration in the following order: (i) first, the securities the Company proposes to sell, (ii) second, the Registrable Shares held by the Holders requested to
be included in the registration, pro rata among such holders on the basis of the number of shares held by each such Holder, (iii) third, the Registrable Shares held by persons other than
the Holders requested to be included in the registration, pro rata among such persons on the basis of the number of shares owned by each such person, and (iv) fourth, other securities
requested to be included in the registration; provided, however, that, except in the case of the Company's initial registered public offering, the Holders of Registrable Shares may register at least
20% of the securities to be included in any such registration pursuant to this Section 3. 

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        (e)   If
a Piggyback Registration is an underwritten secondary registration on behalf of holders of the Company's securities and the managing underwriters advise the Company
in writing that, in their opinion, the number of securities requested to be included in the registration exceeds the number that can be sold in an orderly manner in such offering within a price range
acceptable to the holders initially requesting the registration, the Company may reduce the number of shares included in such registration pursuant to this Section 3. If the number of shares
included in such registration is so reduced, the Company shall include shares in such registration in the following order: (i) first, the securities included therein held by the holders (other
than holders of Registrable Shares) exercising registration rights in connection with such secondary offering, (ii) second, the Registrable Shares held by the Holders of Registrable Shares
requested to be included in the registration, pro rata among such Holders on the basis of the number of shares held by each such Holder, (iii) third, the Registrable Securities held by
persons other than the Holders requested to be included in the registration, pro rata among such persons on the basis of the number of shares owned by each such person, and (iv) fourth,
other securities requested to be included in the registration; provided, however, that in any event the holders of Registrable Securities may register at least 20% of the securities to be included in
any such registration pursuant to this Section 3. 

        (f)    If
any Piggyback Registration is an underwritten offering, the Board of Directors of the Company may select the investment banker(s) and manager(s) to administer the
offering. 

        Section 4.    Registration Procedures. 

        (a)   Certain
Agreements of Company. 

        Whenever
the Company is required under this Agreement to use commercially reasonable efforts to effect the registration of any Registrable Shares under the Securities Act, Company shall,
as expeditiously as possible: 

        (i)    Prepare
and file with the Commission a registration statement with respect to such Registrable Shares and use commercially reasonable efforts to cause such registration
statement to become and remain effective until the earlier of (A) the date when all Registrable Shares covered by the registration statement have been sold pursuant to such registration
statement or Rule 144, or (B) 90 days after the effective date of the registration statement; provided, that before filing such registration statement and the related prospectus and any
amendments or supplements thereto, Company will furnish to counsel selected by the Holders of Registrable Shares to be included in such registration statement copies of all such documents proposed to
be filed, which documents will be subject to the review of such counsel; and provided, further, that such Holders shall furnish to Company such information regarding such Holders and the distribution
proposed by such Holders as Company may reasonably request in writing and as shall be reasonably required in connection with any registration, qualification or compliance referred to in this
Agreement. 

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        (ii)   Prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary
to keep such registration statement effective for the period referred to in this Section 4(a) and to comply with the provisions of the Securities Act with respect to the disposition of all
Registrable Shares covered by such registration statement in accordance with the intended method of disposition by the Holders thereof set forth in such registration statement. 

        (iii)  Furnish
to each Holder of such Registrable Shares such number of conformed copies of such registration statement and of each such amendment and supplement thereto (in
each case including all exhibits), such number of copies of the prospectus included in such registration statement (including each preliminary prospectus and any summary prospectus) in conformity with
the requirements of the Securities Act, such documents incorporated by reference in such registration statement or prospectus, and such other documents, as such Holder may reasonably request in order
to facilitate the disposition of the Registrable Shares covered by such registration statement. 

        (iv)  Use
commercially reasonable efforts to register or qualify the Registrable Shares covered by such registration statement under the "blue sky" laws of such jurisdictions
as any Holder thereof shall reasonably request, and do any and all other acts and things which may be necessary or advisable to enable such Holder to consummate the disposition of the Registrable
Shares owned by such Holder in such jurisdictions for so long as the registration statement is required to remain effective pursuant to this Agreement; provided, however, that in no event shall
Company be obligated to qualify generally to do business in any jurisdiction where it is not at the time otherwise reasonably required to be so qualified or to take any action which would subject it
to service of process in suits other than those arising out of the offer or sale of the Registrable Shares covered by such registration statement in any jurisdiction where it is not at the time so
subject. 

        (v)   Furnish
to each Holder of such Registrable Shares, and any underwriter of such Holder's Registrable Shares, a signed counterpart, addressed to such Holder and
underwriter, of (A) such opinion(s) of counsel for Company and (B) such "comfort" letter(s) signed by the independent public accountants which have certified Company's financial
statements included in such registration statement, each dated such date(s) and covering substantially such matters with respect to such registration statement (and the prospectus included therein)
and, in the case of such accountants' letter, with respect to events subsequent to the date of such financial statements, as is customary with respect to opinions of issuer's counsel and accountants'
letters delivered to Underwriters in underwritten public offerings of Shares or in non-underwritten secondary offerings, as the case may be, and such further matters as such underwriters may
reasonably request. 

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        (vi)  Promptly
notify each Holder of any Registrable Shares covered by such registration statement at any time when a prospectus relating thereto is required to be delivered
under the Securities Act of the happening of any event as a result of which the prospectus contained in such registration statement, as then in effect, includes an untrue statement of a material fact
or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing. 

        (vii) As
the request of any Holder of Registrable Shares covered by such registration statement, promptly prepare and furnish to such Holder a reasonable number of copies of
any supplement to or any amendment of such prospectus that may be necessary so that, as thereafter delivered to the purchaser of such shares, such prospectus shall not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing. 

        (viii) Otherwise
use its best efforts to comply with the Securities Act, the 1934 Act, any and all applicable rules and regulations of the Commission, and make available to
its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve full months, but not more than eighteen months, beginning with the first month of
the first fiscal quarter after the effective date of such registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and
Rule 158 thereunder. 

        (ix)  Use
commercially reasonable efforts to list such Registrable Shares on each exchange on which the Common Stock is then listed, if such Registrable Shares are not
already listed and if such listing is then permitted under the rules of such exchange, or if no shares of Common Stock are then listed, use commercially reasonable efforts to qualify all Registrable
Shares being registered for inclusion on the automated quotation system of the National Association of Shares Dealers, Inc. 

        (x)   Promptly
notify each Holder of Registrable Shares covered by such registration statement of any stop order or similar proceeding initiated by any state or federal
regulatory body and use commercially reasonable efforts to take all necessary steps expeditiously to remove such stop order or similar proceeding. 

        (xi)  Provide
and cause to be maintained a transfer agent and registrar (which in each case may be Company) for all Registrable Shares covered by such registration statement
from and after a date not later than the effective date of such registration statement. 

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        (b)   If
requested by the underwriters for any underwritten offering of Registrable Shares on behalf of a Holder pursuant to Sections 2 or 3, the Company shall enter
into an underwriting agreement with such underwriters for such offering, such agreement to contain such representations and warranties by the Company and such other terms and provisions as are
customarily contained in underwriting agreements with respect to secondary distributions, including, without limitation, indemnities to the effect and to the extent provided in Section 8. 

        (c)   In
connection with the preparation and filing of each registration statement registering Registrable Shares under the Securities Act, the Company shall give each Holder
on whose behalf such Registrable Shares are to be so registered and the underwriters, if any, and their respective counsel and accountants, a reasonable opportunity to participate in the preparation
of such registration statement, each prospectus included therein or filed with the Commission, and each amendment thereof or supplement thereto, and shall give each of them, in each case upon receipt
of an appropriate confidentiality agreement, such reasonable access to its books and records and such reasonable opportunities to discuss the business of the Company with its officers and the
independent public accountants who have certified its financial statements as shall be necessary, in the reasonable opinion of such Holder and such underwriters or their respective counsel, to conduct
a reasonable investigation within the meaning of the Securities Act. 

        Section
5.    Description of Expenses.    All expenses incurred by Company in complying
with any of the foregoing provisions of this Agreement, including, without limitation, all federal and state registration, qualification and filing fees, fees of any exchange or other trading market
on which the Registrable Shares may be listed or admitted to trading, printing expenses, any premium involved in securing a policy or policies of registration insurance, fees and disbursements of
counsel for the Company and accountants' fees and expenses incident to or required by any such registration, and any fees and disbursements or underwriters which are customarily paid or reimbursed by
issuers of Shares are herein called "Registration Expenses," which shall be borne as provided in Section 6. All underwriting discounts, selling commissions and reasonable expenses and fees of
any special counsel to the selling Holders applicable to the sale of Registrable Shares by or on behalf of a Holder hereunder are herein called "Selling Expenses," which shall be borne as provided in
Section 6. 

        Section
6.    Allocation of Expenses.    If the Company is required under this Agreement
to effect the registration of any Holder's Registrable Shares under the Securities Act, Registration Expenses and Selling Expenses in connection with such registration shall be borne
as follows: 

        (a)   All
Registration Expenses incurred with respect to registrations under this Agreement shall be borne by Company. 

        (b)   All
Selling Expenses incurred in connection with all registration statements covering Registrable Shares shall be borne pro rata by the Holders with all other
persons (including the Company) for whose account the Shares covered by such registration statement are offered in accordance with the amount of Shares being so offered for the account of each
such person. 

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        (c)   If the Company determines not to register any Shares with respect to which it has given written notice of intention to register pursuant to Section 3 of this
Agreement, all Registration Expenses incurred by the Holders in connection with such registration shall be borne by Company. 

        Section
7.    Remedies.    The Company recognizes and agrees that the Holders will not have an adequate remedy at law if the Company
fails to comply with this Agreement and that money damages for such failure will not be readily ascertainable, and the Company expressly agrees that, in the event that it is found by a court of law to
have failed to comply with this Agreement, it shall not oppose an application of any Holders or any other person entitled to the benefits of this Agreement requiring specific performance of any and
all provisions of, or enjoining the Company from continuing to commit any breach of, this Agreement. 

        Section
8.    Indemnification; Underwriting Agreements.    In the event that the Company registers under the Securities Act any
Registrable Shares held by any Holder, the following provisions, to the extent permitted by applicable law, shall apply: 

        (a)   Company
Indemnification.    The Company shall indemnify and hold harmless such Holder, the officers and directors of such Holder
and each underwriter of Registrable Shares (including any broker or dealer through whom Registrable Shares may be sold) and each person, if any, who controls such Holder or any such underwriter within
the meaning of Section 15 of the Securities Act, from and against any and all losses, claims, damages, expenses or liabilities, joint or several, to which they or any of them may become subject
under the Securities Act, the 1934 Act, or under any other statute or at common law or otherwise (and, except as hereinafter provided, shall reimburse such Holder and each of the underwriters and each
such officer, director and controlling person, if any, for any legal or other expenses incurred by them or any of them in connection with investigating or defending any action whether or not resulting
in any liability) insofar as such losses, claims, damages, expenses, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained
or incorporated by reference in any registration statement, under which such Registrable Shares were registered under the Securities Act, any preliminary prospectus or the definitive prospectus (or
the registration statement or definitive prospectus as from time to time amended or supplemented by the Company or any document incorporated by reference therein), or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein not misleading, unless such untrue statement or
omission was made in such registration statement, preliminary prospectus or definitive prospectus in reliance upon and in conformity with information furnished in writing to the Company in connection
herewith by such Holder or such underwriter or such officer, director and controlling person, as the case may be, expressly for use therein; provided, however, that such indemnity, insofar as it
relates to any preliminary prospectus, shall not inure to the benefit of any underwriter from whom the person asserting such loss, claim, damage or liability purchased any Registrable Shares which are
the subject thereof (or to the benefit of any person controlling such underwriter), to the extent that such loss, claim, damage or liability arises out of the failure of such underwriter to send or
give a copy of the final prospectus to such person at or prior to the written confirmation of the sale of such Registrable Shares to such person if such statement or omission was corrected in such
final prospectus. Promptly after receipt by such Holder or any underwriter or any officer, director or person controlling such Holder or such underwriter of notice of the commencement of any action in
respect of which indemnity may be sought against the Company, such Holder or such underwriter, as the case may be, shall notify the Company in writing of the commencement thereof, and the Company
shall, subject to the provisions hereinafter stated, assume the defense of such action (including the employment of counsel for the indemnified persons (which shall be a separate counsel for each
Holder, if requested by it), who shall be counsel satisfactory to such indemnified persons), and the payment of expenses insofar as such action shall relate to any alleged liability in respect of
which indemnity may be sought against the Company. Such Holder and each such other indemnified person shall have the right to employ its own separate counsel in any such action in addition to any
separate counsel referred to above and to participate in the defense thereof, but the fees and expenses of such counsel shall not be at the expense of the Company unless the employment of such counsel
has been specifically authorized by the Company, the Company has failed to assume the defense or employ counsel satisfactory to such indemnified person, or the named parties to any such action
(including any impleaded parties) include both such indemnified person and the Company (or an affiliate thereof), and such indemnified person shall have been advised by such counsel that there may be
one or more legal defenses available to it which are different from or additional to those available to the Company (or such affiliate) (in which case the Company shall not have the right to assume
the defense of such action on behalf of such indemnified person). The Company shall not be liable to indemnify any person for any settlement of any such action effected without the Company's consent
(which shall not be unreasonably withheld). The indemnity agreement contained in this Section 8(a) shall be in addition to any liability which the Company may otherwise have and shall remain in
full force and effect regardless of any investigation made by or on behalf of any Holder or other indemnified person. 

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        (b)   Holder
Indemnification.    Each Holder whose Registrable Shares are to be included in a registration statement shall, as a
condition of such inclusion, severally and not jointly indemnify and hold harmless the Company, each of its directors, each of its officers who have signed such registration statement, each person, if
any, who controls the Company within the meaning of Section 15 of the Securities Act, each other selling Holder and each person, if any, who controls such other selling Holder within the
meaning of Section 15 of the Securities Act, from and against any and all losses, claims, damages, expenses or liabilities, joint or several, to which they or any of them may become subject
under the Securities Act, the 1934 Act or under any other statute or at common law or otherwise (and, except as hereinafter provided, shall reimburse the Company and each such director, officer,
person controlling the Company, Holder or person controlling such Holder for any legal or other expenses reasonably incurred by them or any of them in connection with investigating or defending any
actions whether or not resulting in any liability) insofar as such losses, claims, damages, expenses, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained or incorporated by reference in any registration statement under which such Registrable Shares were registered under the Securities Act, in any preliminary
prospectus or in the definitive prospectus (or the registration statement or definitive prospectus as from time to time amended or supplemented or any document incorporated by reference therein) or
arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein not misleading, but
only insofar as any such statement or omission was made in reliance upon and in conformity with information furnished in writing to the Company in connection therewith by or on behalf of such Holder
expressly for use therein. Promptly after receipt of notice of the commencement of any action in respect of which indemnity may be sought against such indemnifying Holder, the Company (or other
recipient of such notice) shall notify the indemnifying Holder in writing of the commencement thereof, and the indemnifying Holder shall, subject to the provisions hereinafter stated, assume the
defense of such action (including the employment of counsel for the indemnified persons, if requested by any of them, who shall be counsel satisfactory to the Company), and the payment of expenses
insofar as such action shall relate to an alleged liability in respect of which indemnity may be sought against such Holder. The Company and each such other indemnified person shall have the right to
employ its own separate counsel in any such action and to participate in the defense thereof, but the fees and expenses of such counsel shall not be at the expense of the indemnifying Holder unless
the employment of such counsel has been specifically authorized by such indemnifying Holder. Such indemnifying Holder shall not be liable to indemnify any person for any settlement of any such action
effected without his consent (which consent shall not be unreasonably withheld). The maximum liability of any Holder under this Section 8(b) in regard to any registration statement shall in no
event exceed the amount of the proceeds received by such Holder from the sale of its Registrable Shares under such registration statement. 

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        (c)   Contribution.    If
the indemnification provided for in Section 8(a) and 8(b) is unavailable or insufficient to hold
harmless an indemnified person in respect of any losses, claims, damages, expenses or liabilities or actions in respect thereof referred to therein, then each indemnifying person referred to therein
shall in lieu of indemnifying such indemnified person contribute to the amount paid or payable by such indemnified person as a result of such losses, claims, damages, expenses, liabilities or actions
in such proportion as is appropriate to reflect the relative fault of the Company, on the one hand, and each other indemnified person, on the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, expenses, liabilities or actions, as well as any other relevant equitable considerations. The relative fault shall be determined by reference to, among
other things, whether any untrue or alleged untrue statement of a material fact relates to information supplied by the Company, on the one hand, or such other indemnified person, on the other hand,
and the relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Holders agree that it would not be just and equitable it
contribution pursuant to this Section 8(c) were determined by pro rata allocation or by any other method of allocation which did not take account of equitable considerations. The amount
paid or payable by an indemnified person as a result of any losses, claims, damages, expenses, liabilities or actions in respect thereof shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified person in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this 8(c), no Holder shall be required to
contribute any amount exceeding the net proceeds received by such Holder from the sale of its Registrable Shares in the registration in question. No person guilty of fraudulent misrepresentations
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who is not guilty of such fraudulent misrepresentation. 

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        (d)   Survival. Obligations under this Section 8 shall survive the completion of any offering of Registrable Shares in a registration
statement under this Agreement. 

        Section
9.    Reports under 1934 Act.    With a view to making available to the Holders
the benefits of Rule 144 and any other rule or regulation of the Commission under the Securities Act that may at any time permit the Holders to sell Registrable Shares to the public without
registration, the Company agrees to: 

        (a)   make
and keep public information available, as those terms are understood and defined in Rule 144, at all times after 90 days after the effective date of
the first registration statement filed by the Company under the Securities Act for the offering of any of its Shares to the general public; 

        (b)   file
with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the 1934 Act; and 

        (c)   furnish
to the Holders so long as the Holders own any Registrable Shares, forthwith upon request (A) a written statement by the Company that it has complied with
the reporting requirements of Rule 144 (at any time after 90 days after the effective date of the first registration statement filed by the Company under the Securities Act referred to
in Section 9(a)(i)), the Securities Act and the 1934 Act (at any time after it has become subject to such reporting requirements), (B) a copy of the most recent annual or quarterly
report of the Company and other reports and documents filed by the Company under the Securities Act or the 1934 Act, and (C) such other information as may be reasonably requested in availing
any Holder of any rule or staff position of the Commission which permits the selling of any such Shares without registration. 

12

 

        Section
10.    Transfer of Registration Rights.    The rights of the Holders of
Registrable Shares under this Agreement may be transferred in whole or in part at any time to any transferee or assignee of any Holder (each a "Permitted Transferee") or Registrable Shares, provided
that the Holder gives the Company written notice at the time of any transfer of Registrable Shares by such Holder stating the name and address of the Permitted Transferee of such Registrable Shares
and identifying the securities with respect to which the rights under this Agreement are being assigned, and so long as such
transfer of securities is in accordance with all applicable state and federal securities laws and regulations and with the Shareholder Agreement among the shareholders of the Company of even date
herewith. 

        Section
11.    Market Stand-off.    Each Holder (including any transferee or assignee)
hereby agrees that, if so requested by the Company and the managing underwriter(s) (if any) in connection with the Company's initial public offering, such Holder shall not sell, make any short sale
of, loan, grant any option for the purchase of, or otherwise transfer or dispose of any Registrable Shares or other securities of the Company without the prior written consent of the Company and the
managing underwriter(s) for such period of time (not to exceed 180 days) following the effective date of a registration statement of the Company filed under the Securities Act as may be
requested by the managing underwriter(s). 

        Section
12.    Miscellaneous.    

        (a)   No
Inconsistent Agreements. The Company shall not hereafter enter into any agreement with respect to its Shares which is inconsistent with
or violates the rights granted to the holders of Registrable Shares in this Agreement. 

        (b)   Adjustment
Affecting Registrable Shares. The Company shall not take any action, or permit any change to occur, with respect to its Shares
that would materially and adversely affect the ability of the holders of Registrable Shares to include such Registrable Shares in a registration undertaken pursuant to this Agreement or that would
materially and adversely affect the marketability of such Registrable Shares in any such registration (including, without limitation, effecting a stock split or a combination of shares). 

        (c)   Remedies.
Any person having rights under any provision of this Agreement may enforce such rights specifically to recover damages caused by
reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. The parties agree and acknowledge that money damages may not be an adequate remedy for any
breach of the provisions of this Agreement and that any party may, in its sole discretion, apply to any court of law or equity of competent jurisdiction (without posting any bond or other security)
for specific performance and for other injunctive relief in order to enforce or prevent violation of the provisions of this Agreement. 

13

 

        (d)   Amendments
and Waivers. Except as otherwise provided in this Agreement, the provisions of this Agreement may be amended or waived only upon
the prior written consent of the Company and holders of a [majority] of the Registrable Shares. The failure of any party to enforce any of the provisions of this Agreement will
in no way be construed as a waiver of such provisions and will not affect the right of such party thereafter to enforce each and every provision of this Agreement in accordance with its terms. 

        (e)   Successors
and Assigns. All covenants and agreements in this Agreement by or on behalf of any of the parties will bind and inure to the
benefit of the respective successors and assigns of the parties, whether so expressed or not. In addition, whether or not any express assignment has been made, the provisions of this Agreement that
are for the benefit of Purchasers or Holders of Registrable Shares are also for the benefit of, and enforceable by, any subsequent Holder of Registrable Shares who consents in writing to be bound by
the Agreement, subject to the provisions of Section 10. 

        (f)    Termination.
The registration rights under this Agreement will terminate on the earlier of (i) the fourth anniversary after the
Company has completed an initial public offering or (ii) with respect to each holder of Registrable Shares, at such time as the holder is able to dispose of all such Registrable Shares in a
three-month period under Rule 144. 

        (g)   Severability.
Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, that provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement. 

        (h)   Counterparts;
Enforceability. This Agreement may be executed in separate counterparts, each of which, when executed, will be an original and
all of which taken together will constitute one and the same agreement. The delivery of this Agreement may be made by facsimile, and facsimile signatures will be treated as original signatures for all
applicable purpose. This Agreement will be, as of the date first written above, binding on and enforceable against each stockholder signing this Agreement, even if less than all of the stockholders
set forth on Schedule A sign on such date and regardless of the failure of any stockholder listed on Schedule A to sign this
Agreement. 

        (i)    Descriptive
Headings; Interpretation. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a
Section of this Agreement. The use of the word "including" in this Agreement will be by way of example rather than by limitation. 

        (j)    Governing
Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York, without regard
to conflicts of law principles. 

14

   
        (k)   Notices.    All notices, demands or other communications to be given or delivered under or by reason of the provisions of this
Agreement must be in writing and be delivered personally to the recipient, sent by reputable express courier service (charges prepaid) or sent by certified or registered mail, return receipt requested
and postage prepaid and shall be deemed to have been given when so delivered, sent or deposited in the U.S. mail, to the parties at the addresses hereinafter indicated or listed on
Schedule A or to such other address as it appears in the records of the Company (unless otherwise indicated by such holder) or to the attention of such other person
as the recipient party has specified by prior written notice to the sending party. Notices, demands or other communication to the Company must be sent to: 

        (l)    Facsimile
Execution.    The parties agree that execution of this Agreement evidenced by facsimile signature constitutes due
execution and delivery. 

        IN
WITNESS WHEREOF OF, the parties have executed this Agreement as of the date first above written. 

	
 	
 	

THE COMPANY:
	
 	
 	

By:	

/s/ Franc Nemanic
 Name: Franc Nemanic

Title: President
	
 	
 	

HOLDERS:
	
 	
 	

TELUS CORPORATION
	
 	
 	

By:	

/s/ Mark Schnarr
 Name: Mark Schnarr

Title: Executive Vice-President, Telus Ventures
	
 	
 	

1053461 ONTARIO LTD.
	
 	
 	

By:	

/s/ William Campbell
 Name: William Campbell

Title: Secretary
	
 	
 	

 	

/s/ John Nemanic
 JOHN NEMANIC
	
 	
 	

 	

/s/ William Campbell
 WILLIAM CAMPBELL
	
 	
 	

 	

/s/ Colin Campbell
 COLIN CAMPBELL

15

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Exhibit 4.3  

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THESE WARRANTS SHALL NOT TRADE THEM BEFORE THE EARLIER OF (I) THE DATE THAT IS 12 MONTHS AND A DAY
AFTER THE DATE THE COMPANY FIRST BECOMES A REPORTING ISSUER IN ANY OF ALBERTA, BRITISH COLUMBIA, MANITOBA, NOVA SCOTIA, ONTARIO, QUEBEC, AND SASKATCHEWAN, IF THE COMPANY IS A SEDAR FILER; AND
(II) THE DATE THAT IS 12 MONTHS AND A DAY AFTER THE LATER OF (A) JULY 1, 2003, AND (B) THE DATE THE COMPANY BECOMES A REPORTING ISSUER IN THE LOCAL JURISDICTION OF THE
PURCHASER OF THE WARRANTS.

EXERCISABLE PRIOR TO 5:00 P.M., EASTERN TIME, ON DECEMBER 28, 2006 AT WHICH TIME THESE WARRANTS SHALL EXPIRE AND BE NULL AND VOID

SHARE PURCHASE WARRANTS TO PURCHASE COMMON SHARES

OF

HOSTOPIA.COM INC.

(a company incorporated under the laws of Delaware) 

	 	 	Number of warrants represented

by this certificate: 300,000

        THIS CERTIFIES THAT, for value received, Data Centurion Canada Inc. (the "Holder") of this share
purchase warrant ("Warrant") is entitled, at any time prior to 5:00 p.m. (Eastern time) on December 28, 2006 (the "Expiry Time") to subscribe for and purchase the number of
fully-paid and non-assessable shares of common stock par value (the "Common Shares") in the capital of HOSTOPIA.COM INC. (the "Company") set forth above on
the basis of one Common Share at a price of US$0.64 (the "Exercise Price") for each Warrant exercised, subject to adjustment as set out herein, by surrendering to the Company at its principal
office, at 5915 Airport Road, 11th Floor, Mississauga, Ontario, Canada L4V 1T1 this Warrant certificate, with a completed and executed Subscription Form and payment in full of the
Common Shares being purchased. 

        The
Company shall treat the Holder as the absolute owner of this Warrant for all purposes and the Company shall not be affected by any notice or knowledge to the contrary. The Holder
shall be entitled to the rights evidenced by this Warrant free from all equities or rights of set-off or counterclaim between the Company and the original or any intermediate Holder and
all persons may act accordingly and the receipt by the Holder of the Common Shares issuable upon exercise hereof shall be a good discharge to the Company and the Company shall not be bound to inquire
into the title of any such Holder. 

 
	1.
	Definitions:    In this Warrant, including the preamble, unless there is something in the subject
matter or context inconsistent therewith, the following expressions shall have the following meanings namely:

	(a)
	"Adjustment
Period" means the period commencing on the date hereof and ending at the Expiry Time;

	(b)
	"Business
Day" means any day other than a Saturday, Sunday, legal holiday or a day on which banking institutions are closed in Toronto, Canada;

	(c)
	"Common
Shares" means the common shares in the capital of the Company as such shares were constituted on the date hereof, as the same may be reorganized or reclassified pursuant to
any of the events set out in Section 10 hereof;

	(d)
	"Company"
means HOSTOPIA.COM INC., a company incorporated under the laws of Delaware and its successors and assigns;

	(e)
	"Current
Market Price" at any date, means the simple average of the closing prices per Common Shares at which the Common Shares have traded on the Toronto Stock Exchange, or, if the
Common Shares in respect of which a determination of current market price is being made are not listed thereon, on such stock exchange on which such shares are listed as may be selected for such
purposes by the directors, or, if the Common Shares are not listed on any stock exchange, then on the over-the-counter market, for any 20 consecutive trading days
selected by the Company commencing not later than 45 trading days before such date and ending not later than 3 days prior to such date, or if such Common Shares are not listed on any
exchange or quoted on any over-the-counter market, the current market price shall be as determined by the directors;

	(f)
	"Dividends
Paid In The Ordinary Course" means dividends paid in any financial year of the Company, whether in (i) cash, (ii) shares of the Company, (iii) warrants
or similar rights to purchase any shares of the Company or property or other assets of the Company provided that the value of such dividends does not in such financial year exceed the
greater of

	(i)
	200%
of the aggregate amount of dividends paid by the Company on the Common Shares in the 12-month period ending immediately prior to the first day of such
financial year, and

	(ii)
	100%
of the consolidated net earnings from continuing operations of the Company, before any extraordinary items, for the 12-month period ending immediately
prior to the first day of such financial year (such consolidated net earnings from continuing operations to be computed in accordance with generally accepted accounting principles in Canada);

	(g)
	"Exercise
Price" means US$0.64 per share, subject to adjustment in accordance with Section 10 hereof;

	(h)
	"Expiry
Time" means 5:00 p.m., Eastern time, on December 28, 2006;

	(i)
	"Holder"
means the holder set forth on the first page hereof; 

2

 

	(j)
	"person"
means an individual, corporation, partnership, unincorporated syndicate, unincorporated organization, trust, trustee, executor, administrator, or other legal representative,
or any group or combination thereof;

	(k)
	"Trading
Day" with respect to a stock exchange or over-the-counter market means a day on which such stock exchange or over-the-counter
market is open for business; and

	(l)
	"Warrant"
means a share purchase warrant exercisable to purchase one Common Share at US$0.64 until the Expiry Time.

	2.
	Expiry Time:    At the Expiry Time, all rights under the Warrants evidenced hereby, in respect of
which the right of subscription and purchase herein provided for shall not theretofore have been exercised, shall expire and be of no further force and effect.

	3.
	Exercise Procedure:

	(a)
	The
Holder may exercise the right to subscribe and purchase herein provided for by delivering to the Company prior to the Expiry Time at its principal office this Warrant certificate,
with the Subscription Form duly completed and executed by the Holder or its legal representative or attorney, duly appointed by an instrument in writing in form and manner satisfactory to the Company,
together with a certified cheque or bank draft payable to or to the order of the Company in an amount equal to the aggregate Exercise Price in respect of the Warrants so exercised. Any Warrant
certificate so surrendered shall be deemed to be surrendered only upon delivery thereof to the Company at its principal office set forth herein (or to such other address as the Company may
notify the Holder).

	(b)
	Upon
such delivery as aforesaid, the Company shall cause to be issued to the Holder hereof the Common Shares subscribed for not exceeding those which such Holder is entitled to
purchase pursuant to this certificate and the Holder hereof shall become a shareholder of the Company in respect of the Common Shares subscribed for with effect from the date of such delivery and
shall be entitled to delivery of a certificate evidencing the Common Shares and the Company shall cause such certificate or certificates to be mailed to the Holder hereof at the address or addresses
specified in such subscription within 5 Business Days of such delivery.

	(c)
	In
the event that this Warrant is exercised before the expiration of the hold period stated on the legend set forth on the first page hereof, the certificate representing the Common
Shares issued upon such exercise shall bear the following legend: 

"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT") OR ANY STATE, CANADIAN OR PROVINCIAL SECURITIES LAWS. THEY MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACTS OR UNLESS THE TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION UNDER SUCH ACTS.

3

 

THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY, ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 (OR ANY SUCCESSOR TO THAT RULE) UNDER THE SECURITIES ACT, OR (D) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF FURTHER AGREES (i) NOT TO ENGAGE IN HEDGING
TRANSACTIONS INVOLVING THESE SECURITIES UNLESS SUCH TRANSACTIONS MEET THE REQUIREMENTS OF AND COMPLY WITH THE SECURITIES ACT, AND (ii) THAT THE COMPANY WILL REFUSE TO REGISTER ANY TRANSFER OF
THE SECURITIES NOT MADE
IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE SECURITIES ACT, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT.

The Company shall furnish to any shareholder upon request and without charge, a full statement of the designations, relative rights, preferences and limitations of the shares
of each class authorized to be issued and the powers, designations, preferences and relative, participating, optional, or other special rights of each series of preferred shares and the
qualifications, limitations or restrictions of such preferences and/or rights so far as the same have been fixed and the authority of the board to designate and fix the relative rights, preferences
and limitation of other series.

There are restrictions on the right to transfer the shares represented by this certificate. In addition, such shares are subject to a Shareholder Agreement dated the
27th day of December, 2001, as the same may be amended from time to time, and may not be pledged, sold or otherwise transferred except in accordance with the
provisions thereof."

	4.
	Partial Exercise:    The Holder may subscribe for and purchase a number of Common Shares less
than the number the Holder is entitled to purchase pursuant to this certificate. In the event of any such subscription prior to the Expiry Time, the Holder shall in addition be entitled to receive,
without charge, a new Warrant certificate in respect of the balance of the Common Shares which the Holder was entitled to subscribe for pursuant to this Warrant certificate and which were then
not purchased. 

4

 
	5.
	No Fractional Shares:    Notwithstanding any adjustments provided for in Section 10 hereof
or otherwise, the Company shall not be required upon the exercise of any Warrants, to issue fractional Common Shares in satisfaction of its obligations hereunder. Where a fractional Common Share
would, but for this Section 5, have been issued upon exercise of a Warrant, in lieu thereof, there shall be paid to the Holder an amount equal (rounded to the nearest $0.01) to the product
obtained by multiplying such fractional share interest by the Current Market Price at the date of delivery of this Warrant certificate.

	6.
	Transfer of Warrants:    Subject to applicable law, the Holder may transfer the within Warrants
by delivering to the Company prior to the Expiry Time at its principal office this Warrant certificate with the Transfer Form duly completed and executed by the Holder or its legal representative or
attorney, duly appointed by an instrument in writing in form and manner satisfactory to the Company.

	7.
	Not a Shareholder:    Nothing in this certificate or in the holding of a Warrant evidenced hereby
shall be construed as conferring upon the Holder any right or interest whatsoever as a shareholder of the Company.

	8.
	No Obligation to Purchase:    Nothing herein contained or done pursuant hereto shall obligate the
Holder to subscribe for or the Company to issue any shares except those shares in respect of which the Holder shall have exercised its right to purchase hereunder in the manner provided herein.

	9.
	Covenants:

	(a)
	The
Company covenants and agrees that so long as any Warrants evidenced hereby remain outstanding, it shall reserve and there shall remain unissued out of its authorized capital a
sufficient number of Common Shares to satisfy the right of purchase herein provided for and such Common Shares shall be issued as fully paid and non-assessable Common Shares and the
holders thereof shall not be liable to the Company or to its creditors in respect thereof.

	(b)
	The
Company shall use all reasonable efforts to preserve and maintain its corporate existence.

	(c)
	If
the issuance of the Common Shares upon the exercise of the Warrants requires any filing or registration with or approval of any securities regulatory authority or other
governmental authority or compliance with any other requirement under any law before such Common Shares may be validly issued (other than a prospectus, registration statement or similar document), the
Company agrees to take such actions as may be necessary to secure such filing, registration, approval or compliance, as the case may be.

	10.
	Adjustments:

	(a)
	Adjustment:    The
rights of the holder of this Warrant, including the number of Common Shares issuable upon the exercise of such Warrant, will
be adjusted from time to time in the events and in the manner provided in, and in accordance with the provisions of, this section. 

5

 

	(b)
	The
Exercise Price in effect at any date will be subject to adjustment from time to time as follows:

	(i)
	Share
Reorganization:    If and whenever at any time during the Adjustment Period, the Company shall (A) subdivide or
redivide the outstanding Common Shares into a greater number of Common Shares, (B) consolidate or combine the outstanding Common Shares into a lesser number of Common Shares, or (C) fix
a record date for the issue of Common Shares or securities convertible into Common Shares to all or substantially all of the holders of Common Shares by way of a stock dividend or other distribution
other than a Dividend Paid in the Ordinary Course, then, in each such event, the Exercise Price shall, on the record date for such event or, if no record date is fixed, the effective date of such
event, be adjusted so that it will equal the rate determined by multiplying the Exercise Price in effect immediately prior to such date by a fraction, of which the numerator shall be the total number
of Common Shares outstanding on such date before giving effect to such event, and of which the denominator shall be the total number of Common Shares outstanding on such date after giving effect to
such event. Such adjustment shall be made successively whenever any such event shall occur. Any such issue of Common Shares by way of a stock dividend shall be deemed to have been made on the record
date for such stock dividend for the purpose of calculating the number of outstanding Common Shares under paragraphs 10(b)(i) and (ii) hereof.

	(ii)
	Rights
Offering:    If and whenever at any time during the Adjustment Period, the Company shall fix a record date for the issue
of rights, options or warrants to all or substantially all of the holders of Common Shares entitling the holders thereof, within a period expiring not more than 45 days after the record date
for such issue, to subscribe for or purchase Common Shares (or securities convertible into or exchangeable for Common Shares) at a price per share (or having a conversion or exchange
price per share) less than 95% of the Current Market Price on such record date, then the Exercise Price shall be adjusted immediately after such record date so that it will equal the rate determined
by multiplying the Exercise Price in effect on such record date by a fraction, of which the numerator shall be the total number of Common Shares outstanding on such record date plus the number of
Common Shares equal to the number arrived at by dividing the aggregate price of the total number of additional Common Shares so offered for subscription or purchase (or the aggregate conversion
or exchange price of the convertible or exchangeable securities so offered) by such Current Market Price, and of which the denominator shall be the total number of Common Shares outstanding on such
record date plus the total number of additional Common Shares so offered for subscription or purchase (or into or for which the convertible or exchangeable securities so offered are convertible
or exchangeable). Any Common Shares owned by or held for the account of the Company or any subsidiary of the Company shall be deemed not to be outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date is fixed, provided that if two or more such record dates or record dates referred to in this paragraph 10(b)(ii) are fixed
within a period of 25 Trading Days, such adjustment will be made successively as if each of such record dates occurred on the earliest of such record dates. To the extent that any such rights,
options or warrants are not exercised prior to the expiration thereof, the Exercise Price shall then be readjusted to the Exercise Price which would then be in effect based upon the number of Common
Shares (or securities convertible into or exchangeable for Common Shares) actually issued upon the exercise of such rights, options or warrants, as the case may be. 

6

 

	(iii)
	Distribution:    If
and whenever at any time during the Adjustment Period, the Company shall fix a record date for the making of
a distribution to all or substantially all of the holders of Common Shares of (A) shares of any class other than Common Shares whether of the Company or any other corporation,
(B) rights, options or warrants to acquire Common Shares or securities exchangeable for or convertible into Common Shares or property or other assets or the Company (other than rights, options
or warrants exercisable by the holders thereof within a period expiring not more than 45 days after the record date for such issue or distribution to acquire Common Shares or securities
exchangeable for or convertible into Common Shares at a price per share, or at an exchange or conversion price per share in the case of securities exchangeable for or convertible into Common Shares,
of at least 95% of the Current Market Price of the Common Shares on such record date), (C) evidences of indebtedness, or (D) cash, securities or other property or assets then, in each
such case and if such distribution does not constitute a Dividend Paid in the Ordinary Course, or fall under clauses (i) or (ii) above, the Exercise Price will be adjusted immediately
after such record date so that it will equal the rate determined by multiplying the Exercise Price in effect on such record date by a fraction, of which the numerator shall be the total number of
Common Shares outstanding on such record date multiplied by the Current Market Price on the earlier of such record date and the date on which the Company announces its intention to make such
distribution, less the aggregate fair market value (as determined by the directors, acting reasonably, at the time such distribution is authorized) of such shares or rights, options or warrants
or evidences of indebtedness or cash, securities or other property or assets so distributed, and of which the denominator shall be the total number of Common Shares outstanding on such record date
multiplied by such Current Market Price. Any Common Shares owned by or held for the account of the Company or any subsidiary of the Company shall be deemed not to be outstanding for the purpose of any
such computation. Such adjustment shall be made successively whenever such a record date is fixed, provided that if two or more such record dates or record dates referred to in this
paragraph 10(b)(iii) are fixed within a period of 25 Trading Days, such adjustment will be made successively as if each of such record dates occurred on the earliest of such record
dates. To the extent that any such rights, options or warrants so distributed are not exercised prior to the expiration thereof, the Exercise Price shall then be readjusted to the Exercise Price which
would then be in effect based upon such rights, options or warrants or evidences of indebtedness or cash, securities or other property or assets actually distributed or based upon the number or amount
of securities or the property or assets actually issued or distributed upon the exercise of such rights, options or warrants, as the case may be. 

7

 

	(c)
	Reclassifications:    If
and whenever at any time during the Adjustment Period, there is (A) any reclassification of or amendment to the
outstanding Common Shares, any change of the Common Shares into other shares or any other reorganization of the Company (other than as described in subsection 10(b) hereof), (B) any
consolidation, amalgamation, arrangement, merger or other form of business combination of the Company with or into any other corporation resulting in any reclassification of the outstanding Common
Shares, any change of the Common Shares into other shares or any other reorganization of the Company, or (C) any sale, lease, exchange or transfer of the undertaking or assets of the Company as
an entirety or substantially as an entirety to another corporation or entity, then, in each such event, the Holder of this Warrant which is thereafter exercised shall be entitled to receive, and shall
accept, in lieu of the number of Common Shares to which such Holder was theretofore entitled upon such exercise, the kind and number or amount of shares or other securities or property which such
Holder would have been entitled to receive as a result of such event if, on the effective date thereof, such Holder had been the registered holder of the number of Common Shares to which such Holder
was theretofore entitled upon such exercise. If necessary as a result of any such event, appropriate adjustments will be made in the application of the provisions set forth in this subsection with
respect to the rights and interests thereafter of the Holder of this Warrant certificate to the end that the provisions set forth in this subsection will thereafter correspondingly be made applicable,
as nearly as may reasonably be, in relation to any shares or other securities or property thereafter deliverable upon the exercise of this Warrant. Any such adjustments will be made by and set forth
in an instrument supplemental hereto approved by the directors, acting reasonably, and shall for all purposes be conclusively deemed to be an appropriate adjustment.

	11.
	Rules Regarding Calculation of Adjustment of Exercise Price:

	(a)
	The
adjustments provided for in Section 10 are cumulative and will, in the case of adjustments to the Exercise Price, be computed to the nearest whole Common Share and will be
made successively whenever an event referred to therein occurs, subject to the following subsections of this Section 11.

	(b)
	No
adjustment in the Exercise Price is required to be made unless such adjustment would result in a change of at least 1% in the prevailing Exercise Price; provided, however, that any
adjustments which, except for the provisions of this subsection, would otherwise have been required to be made, will be carried forward and taken into account in any subsequent adjustments.

	(c)
	No
adjustment in the Exercise Price will be made in respect of any event described in Section 10, other than the events referred to in clauses 10(1)(c), if the Holder is
entitled to participate in such event on the same terms, mutatis mutandis, as if the Holder had exercised this Warrant prior to or on the effective date
or record date of such event. Any participation by the Holder in a distribution, dividend or other event referred to in paragraph 10, is subject to the prior approval of any stock exchange or
over-the-counter market on which the Common Shares are then listed or traded.

	(d)
	No
adjustment in the Exercise Price will be made under Section 10 in respect of the issue from time to time of Common Shares issuable from time to time as Dividends Paid in the
Ordinary Course to holders of Common Shares who exercise an option or election to receive substantially equivalent dividends in Common Shares in lieu of receiving a cash dividend. 

8

 

	(e)
	If
at any time a dispute arises with respect to adjustments provided for in Section 10, such dispute will be conclusively determined by the auditor of the Company or, if they
are unable or unwilling to act, by such other firm of independent chartered accountants as may be selected by action of the directors of the Company and any such determination, subject to regulatory
approval, will be binding upon the Company and the Holder. The Company will provide such auditor or chartered accountant with access to all necessary records of the Company.

	(f)
	In
case the Company after the date of issuance of this Warrant takes any action affecting the Common Shares, other than action described in Section 10, which in the opinion of
the board of directors of the Company would materially affect the rights of the Holder, the Exercise Price will be adjusted in such manner, if any, and at such time, by action of the directors of the
Company in their sole discretion, acting reasonably, but subject in all cases to any necessary regulatory approval. Failure of the taking of action by the directors of the Company so as to provide for
an adjustment on or prior to the effective date of any action by the Company affecting the Common Shares will be conclusive evidence that the board of directors of the Company has determined that it
is equitable to make no adjustment in the circumstances.

	(g)
	If
the Company sets a record date to determine the holders of the Common Shares for the purpose of entitling them to receive any dividend or distribution or sets a record date to take
any other action and, thereafter and before the distribution to such shareholders of any such dividend or distribution or the taking of any other action, decides not to implement its plan to pay or
deliver such dividend or distribution or take such other action, then no adjustment in the Exercise Price will be required by reason of the setting of such record date.

	(h)
	In
the absence of a resolution of the directors of the Company fixing a record date for any event giving rise to an adjustment under paragraphs 10.(b)(ii)
and 10.(b)(iii) of this Warrant, the Company will be deemed to have fixed as the record date therefor the date on which such event actually occurs.

	(i)
	As
a condition precedent to the taking of any action which would require any adjustment to this Warrant, including the Exercise Price, the Company shall take any corporate action
which may be necessary in order that the Company have unissued and reserved in its authorized capital and may validly and legally issue as fully paid and non-assessable all the shares or
other securities which the Holder is entitled to receive on the full exercise thereof in accordance with the provisions hereof.

	(j)
	The
Company will from time to time, immediately after the occurrence of any event which requires an adjustment or readjustment as provided in Section 10, forthwith give notice
to the Holder specifying the event requiring such adjustment or readjustment and the results thereof, including the resulting Exercise Price.

	(k)
	The
Company covenants to and in favour of the Holder that so long as this Warrant remains outstanding, it will give notice to the Holder of its intention to fix a record date for any
event referred to in section 10 (other than the subdivision or consolidation of the Common Shares) which may give rise to an adjustment in the Exercise Price, and, in each case, such notice
shall specify the particulars of such event and the record date and the effective date for such event; provided that the Company shall only be required to specify in such notice such particulars of
such event as have been fixed and determined on the date on which such notice is given. Such notice shall be given not less than 10 days in each case prior to such applicable record date or
effective date. 

9

 

	(l)
	In
any case in which this section shall require that an adjustment shall become effective immediately after a record date for or an effective date of an event referred to herein, the
Company may defer, until the occurrence and consummation of such event, issuing to the Holder of this Warrant, if exercised after such record date or effective date and before the occurrence and
consummation of such event, the additional Common Shares or other securities or property issuable upon such exercise by reason of the adjustment required by such event, provided, however, that the
Company will deliver to the Holder an appropriate instrument evidencing the Holder's right to receive such additional Common Shares or other securities or property upon the occurrence and consummation
of such event and the right to receive any dividend or other distribution in respect of such additional Common Shares or other securities or property declared in favour of the holders of record of
Common Shares or of such other securities or property on or after the Exercise Date or such later date as the Holder would, but for the provisions of this subsection, have become the holder of record
of such additional Common Shares or of such other securities or property.

	12.
	Consolidation and Amalgamation:

	(a)
	The
Company shall not enter into any transaction whereby all or substantially all or its undertaking, property and assets would become the property of any other corporation (herein
called a "successor corporation") whether by way of reorganization, reconstruction, consolidation, amalgamation, merger, transfer, sale, disposition or otherwise, unless prior to or contemporaneously
with the consummation of such transaction the Company and the successor corporation shall have executed such instruments and done such things as the Company, acting reasonably, considers necessary or
advisable to establish that upon the consummation of such transaction:

	(i)
	the
successor corporation will have assumed all the covenants and obligations of the Company under this Warrant, and

	(ii)
	the
Warrant will be a valid and binding obligation of the successor corporation entitling the Holder, as against the successor corporation, to all the rights of the
Holder under this Warrant;

	(b)
	Whenever
the conditions of subsection 12(1) shall have been duly observed and performed the successor corporation shall possess, and from time to time may exercise, each and
every right and power of the Company under this Warrant in the name of the Company or otherwise and any act or proceeding by any provision hereof required to be done or performed by any director or
officer of the Company may be done and performed with like force and effect by the like directors or officers of the successor corporation.

	13.
	Representation and Warranty:    The Company hereby represents and warrants with and to the
Holder that the Company is duly authorized and has the corporate and lawful power and authority to create and issue this Warrant and the Common Shares issuable upon the exercise hereof and perform its
obligations hereunder and that this Warrant represents a valid, legal and binding obligation of the Company enforceable in accordance with its terms. 

10

 
	14.
	If Share Transfer Books Closed:    The Company shall not be required to deliver certificates for
Common Shares while the share transfer books of the Company are properly closed, prior to any meeting of shareholders or for the payment of dividends or for any other purpose and in the event of the
surrender of any Warrant in accordance with the provisions hereof and the making of any subscription and payment for the Common Shares called for thereby during any such period delivery of
certificates for Common Shares may be postponed for a period not exceeding 5 Business Days after the date of the re-opening of said share transfer books provided that any such
postponement of delivery of certificates shall be without prejudice to the right of the Holder, if the Holder has surrendered the same and made payment during such period, to receive such certificates
for the Common Shares called for after the share transfer books shall have been re-opened.

	15.
	Protection of Shareholders, Officers and Directors:    Subject as herein provided, all or any of
the rights conferred upon the Holder may be enforced by the Holder by appropriate legal proceedings. No recourse under or upon any obligation, covenant or agreement herein contained shall be had
against any shareholder, officer or director of the company, either directly or through the Company, it being expressly agreed and declared that the obligations under the Warrants evidenced hereby,
are solely corporate obligations of the Company and that no personal liability whatever shall attach to or be incurred by the shareholders, officers, or directors of the Company or any of them in
respect thereof, any and all rights and claims against every such shareholder, officer or director being hereby expressly waived as a condition of and as a consideration for the issue of the Warrants
evidenced hereby.

	16.
	Lost Certificate:    If the Warrant certificate evidencing the Warrants issued hereby becomes
stolen, lost, mutilated or destroyed the Company may, on such terms as it may in its discretion impose, respectively issue and countersign a new Warrant of like denomination, tenor and date as the
certificate so stolen, lost mutilated or destroyed.

	17.
	Governing Law:    This Warrant shall be governed by, and construed in accordance with, the laws
of the Province of Ontario and the laws of Canada applicable therein but the reference to such laws shall not, by conflict of laws, rules or otherwise, require the application of the law of any
jurisdiction other than the Province of Ontario. The Company hereby irrevocably attorns to the non-exclusive jurisdiction of the Courts of the Province of Ontario.

	18.
	Severability:    If any one or more of the provisions or parts thereof contained in this Warrant
should be or become invalid, illegal or unenforceable in any respect in any jurisdiction, the remaining provisions or parts thereof contained herein shall be and shall be conclusively deemed to be, as
to such jurisdiction, severable therefrom.

	19.
	Headings:    The headings of the articles, sections, subsections and clauses of this Warrant
have been inserted for convenience and reference only and do not define, limit, alter or enlarge the meaning of any provision of this Warrant.

	20.
	Numbering of Articles, etc.:    Unless otherwise stated, a reference herein to a numbered or
lettered article, section, subsection, clause, subclause or schedule refers to the article, section, subsection, clause, subclause or schedule bearing that number or letter in this Warrant. 

11

 
	21.
	Gender:    Whenever used in this Warrant, words importing the singular number only shall include
the plural, and vice versa, and words importing the masculine gender shall include the feminine gender.

	22.
	Day not a Business Day:    In the event that any day on or before which any action is required
to be taken hereunder is not a Business Day, then such action shall be required to be taken on or before the requisite time on the next succeeding day that is a Business Day.

	23.
	Binding Effect:    This Warrant and all of its provisions shall enure to the benefit of the
Holder, its successors, assigns and legal personal representatives and shall be binding upon the Company and its successors and permitted assigns.

	24.
	Notice:    Unless herein otherwise expressly provided, a notice to be given hereunder to the
Holder will be deemed to be validly given if the notice is sent by telecopier or prepaid same day courier to the Holder addressed as follows: 

Data
Centurion Canada Inc. 

Attention:
Igor Nikolaichuk, Chief Executive Officer

Telecopier No.: (905) 660-5616 

	25.
	Time of Essence:    Time shall be of the essence hereof. 

        IN WITNESS WHEREOF the Company has caused this Warrant certificate to be signed by its duly authorized officer as of this
1st day of July, 2003. 

	 	 	HOSTOPIA.COM INC.
	

 	
 	

Per:	

/s/  COLIN CAMPBELL      
	 	 	 	
 Chief Operating Officer

12

 
 

SUBSCRIPTION FORM  
    

	TO:	 	THE SECRETARY OF HOSTOPIA.COM INC.
	AND TO:	 	HOSTOPIA.COM INC.

        The
undersigned holder of the within Warrant certificate hereby irrevocably subscribes for              Common Shares of HOSTOPIA.COM INC.
(the "Company") pursuant to the within Warrant and tenders herewith a certified cheque or bank draft for $             (US$0.64 per Common Share) in full
payment therefor. 

        DATED this              day of
                        ,
200    . 

	 	 	DATA CENTURION CANADA INC.
	 	 	Per:	 	 
	 	 	 	 	

	 	 	 	 	Igor Nikolaichuk, Chief Executive Officer

	 

	 	 	Registration

instructions:	 	 
	 	 	 	 	

	 	 	 	 	

	 	 	 	 	

                    
Please check if the Common Shares certificates are to be delivered at the office where this Warrant certificate is surrendered, failing which
the Common Shares certificates will be mailed to the subscriber at the address set out above. 

        If
any Warrants represented by this certificate are not being exercised, a new Warrant certificate for the unexercised Warrants will be issued and delivered with the Common
Share certificate. 

 
 

TRANSFER FORM  
    

        FOR VALUE RECEIVED, the undersigned hereby sells, transfer and assigns to
                             

Warrants represented by the within Warrant certificate and appoints
                                         
                 

attorney to transfer the said Warrants on the books of HOSTOPIA.COM INC. with full power of substitution in the premises. 

        DATED
                             , 200    . 

	 	 	 
	 	 	

	 	 	(Signature of Registered Holder)
	 	 	 
	 	 	

	 	 	(Name of Registered Holder)

	 

	NOTICE:	 	The signature of this assignment must correspond with the name as written upon the face of the Warrant certificate in every particular without alteration or enlargement or any change whatsoever.

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SUBSCRIPTION FORM

TRANSFER FORM

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