Document:

Exhibit 4.12

                   AMENDED AND RESTATED UNDERWRITING AGREEMENT

July 17, 2007

Zarlink Semiconductor Inc.
400 March Rd.
Ottawa, ON
K2K 3HA

Attention:

Dear Sirs/Mesdames:

CIBC World Markets Inc. (the "Lead Underwriter"),  National Bank Financial Inc.,
RBC  Dominion  Securities  Inc.  and  Scotia  Capital  Inc.  (collectively,  the
"Underwriters",   and  each,   an   "Underwriter")   understand   that   Zarlink
Semiconductor Inc. (the "Corporation")  proposes to issue and sell to the public
through the  Underwriters  an aggregate of 75,000  subscription  receipts of the
Corporation  (the  "Subscription  Receipts")  pursuant to this  Agreement.  Each
Subscription Receipt will entitle the holder either:

      (a)   to receive $1,000  principal  amount of 6.0%  convertible  unsecured
            subordinated   debentures   (each  a   "Convertible   Debenture  and
            collectively,  the  "Convertible  Debentures"),  without any further
            action  required  on the  part  of the  holder  of the  Subscription
            Receipt and without payment of additional consideration at the close
            of business on the Acquisition Closing Date (as defined below); or

      (b)   if the closing of the  Acquisition  (as defined below) does not take
            place, or the other  conditions to the exchange of the  Subscription
            Receipts are not satisfied, by 5:00 p.m. (Toronto time) on September
            28, 2007,  or if the  Acquisition  Agreement  (as defined  below) is
            terminated at any earlier time or if the Corporation has advised the
            Underwriters  or  announced to the public that it does not intend to
            proceed with the  Acquisition  (in each case, a "Termination  Event"
            and the date on which a Termination  Event occurs,  the "Termination
            Date"),  to receive an amount equal to the aggregate of (i) the full
            subscription price therefor,  and (ii) an additional amount equal to
            the amount of interest  that would have  accrued on the  Convertible
            Debentures  if such  Convertible  Debentures  had  been  issued  and
            outstanding  from (and interest thereon had been accrued at the rate
            of 6.0% per annum) the Offering  Closing Date until the  Termination
            Date.

The proceeds from the sale of the Offered Securities (the "Escrowed Funds") will
be paid to and held by  Computershare  Trust Company of Canada,  as escrow agent
(the "Escrow Agent"),  and invested in short-term  obligations of, or guaranteed
by,  the  Government  of Canada  (and/or  other  approved  investments)  pending
completion of the  Acquisition or the occurrence of a Termination  Event. On the
Acquisition  Closing Date and following  satisfaction of the other conditions to
the exchange of the Subscription  Receipts,  the Escrowed Funds will be released
to the  Corporation  and one  Convertible  Debenture  will be  issued  for  each
Subscription  Receipt.  The  Corporation  will use the  Escrowed  Funds to pay a
portion of the purchase price of the Acquisition.

<PAGE>
                                      -2-

In the event of a Termination Event, if the amount of the Escrowed Funds held by
the Escrow Agent under the Subscription  Receipt Agreement (as defined below) is
less than the amount owing to holders of  Subscription  Receipts,  the shortfall
will be promptly made up by the Corporation in immediately available funds.

The Underwriters understand that the Corporation has prepared and filed:

      (a)   a Preliminary  Prospectus to qualify the distribution of the Offered
            Securities (as defined  below) in each of the  Qualifying  Provinces
            (as defined  below) and has  received a  Preliminary  MRRS  Decision
            Document therefor, and

      (b)   a  Registration  Statement  relating  to the  offer  and sale of the
            Offered Securities in the United States.

The Underwriters  also understand that the Corporation will prepare and file all
documents necessary to qualify the distribution of the Offered Securities in the
Qualifying Provinces and the United States.

Subject to the terms and  conditions  hereof,  each of the  Underwriters  offers
severally,  and not jointly,  to purchase from the Corporation in the respective
percentages  set forth  opposite the  respective  names of the  Underwriters  in
paragraph 13 hereof,  and by its  acceptance  hereof the  Corporation  agrees to
issue and sell to the  Underwriters  at the  Offering  Closing  Time (as defined
below),  75,000  Offered  Securities  at a purchase  price of $1,000 per Offered
Security (for an aggregate purchase price of $75,000,000).

By its acceptance  hereof,  the Corporation  also grants to the  Underwriters an
option (the "Over-Allotment Option") to purchase from the Corporation,  upon the
terms and  conditions  set forth  herein,  up to an  additional  11,250  Offered
Securities  at the  offering  price to the  public for the  purpose of  covering
over-allotments,   if  any,   and  for  market   stabilization   purposes.   The
Over-Allotment  Option may be  exercised  in whole or in part by written  notice
(the "Over-Allotment  Notice") to the Corporation given by the Lead Underwriter,
on behalf of the  Underwriters,  following the Offering Closing Date at any time
and from time to time not later than 30 days following the Offering Closing Date
and specifying the number of Offered Securities to be purchased.

Upon the  exercise  of the  Over-Allotment  Option and  subject to the terms and
conditions   hereof,   the  Corporation  agrees  to  issue  and  sell,  and  the
Underwriters agree severally,  and not jointly,  to purchase,  in the respective
percentages  set forth  opposite the  respective  names of the  Underwriters  in
paragraph 13 hereof,  and by its  acceptance  hereof the  Corporation  agrees to
issue and sell to the  Underwriters at the Additional  Offering Closing Time (as
defined  below),   that  number  of  Offered  Securities  as  indicated  in  the
Over-Allotment Notice at the Additional Offering Closing Time.

In the event the  Acquisition  Closing  Date occurs on or prior to the  Offering
Closing Date or Additional  Offering  Closing Date, as applicable,  investors in
the Offering will receive

<PAGE>
                                      -3-

Convertible  Debentures  on the  Offering  Closing Date or  Additional  Offering
Closing Date, as applicable, in lieu of Subscription Receipts.

In consideration  for the  Underwriters'  agreement to purchase and offer to the
public the Offered  Securities and in consideration of the services rendered and
to be rendered by the  Underwriters  in connection  therewith,  the  Corporation
agrees to pay to the  Underwriters a fee equal to up to 3% of the gross proceeds
from the sale of the Offered Securities, provided that:

      (a)   only one-half of such fee (i.e.,  1.5% of such gross proceeds) shall
            be due and payable (in the manner  described  in paragraph 7 hereof)
            at the Offering  Closing Time and, if the  Over-Allotment  Option is
            exercised,  one-half of such fee for such  additional  amount (i.e.,
            1.5% of such additional gross proceeds) shall be due and payable (in
            the  manner  described  in  paragraph  7 hereof)  at the  Additional
            Offering Closing Time, and

      (b)   the other  one-half  of such fee (i.e.  another  1.5% of such  gross
            proceeds)  shall be payable (in the manner  described in paragraph 7
            hereof)  immediately  upon the Acquisition  Closing Date (as defined
            below); provided, however, that if the Acquisition Closing Date does
            not  occur,  the  Underwriters'  fee under this  Agreement  shall be
            limited to the 1.5% of gross  proceeds paid at the Offering  Closing
            Time and  Additional  Offering  Closing Time, if any, and no further
            fee shall be due or payable to the Underwriters hereunder.

For greater  certainty,  the services provided by the Underwriters in connection
herewith  will not be subject to Goods and  Services  Tax provided for under the
Excise Tax Act (Canada) and taxable  supplies  will be  incidental to the exempt
financial services provided.

                                   DEFINITIONS

In addition to the terms defined above, in this Agreement:

"Acquisition"  means the  acquisition by the  Corporation of LHI by means of the
Merger pursuant to the Acquisition Agreement;

"Acquisition  Agreement"  means an  agreement  and plan of merger dated June 25,
2007,   between  Merger  Sub,  LHI  and  Navigant  Capital  Advisors,   LLC,  as
representative  of LHI's  stockholders,  pursuant to which the Corporation  will
indirectly acquire Legerity through the merger (the "Merger") of Merger Sub with
and into LHI as the surviving corporation of the Merger;

"Acquisition Closing Date" means the date of closing of the Acquisition;

"Additional Offering Closing Date" has the meaning ascribed thereto in paragraph
7.2;

"Additional Offering Closing Time" has the meaning ascribed thereto in paragraph
7.2;

<PAGE>
                                      -4-

"affiliate",     "distribution",    "material    change",    "material    fact",
"misrepresentation",   and  "subsidiary"  means,  an  affiliate,   distribution,
material change,  material fact,  misrepresentation and subsidiary as defined in
the Securities Act (Ontario);

"Agreement" means the agreement resulting from the acceptance by the Corporation
of the offer made by the Underwriters hereby;

"Amended  and  Restated  Preliminary  Prospectus"  means the  English and French
language  versions (unless the context  indicates  otherwise) of the amended and
restated  preliminary  short form prospectus of the Corporation to be dated July
17, 2007 relating to the distribution of the Offered  Securities and, unless the
context  otherwise  requires,  includes all  documents  incorporated  therein by
reference and any amendments thereto;

"Amended Preliminary MRRS Decision Document" means a decision document issued in
accordance with the Mutual Reliance Review System  evidencing that a receipt for
the Amended and Restated Preliminary  Prospectus has been issued for each of the
Qualifying Provinces;

"Business  Day" means a day which is not a Saturday,  a Sunday or a statutory or
civic holiday in Ottawa, Ontario or New York, New York;

"Common Shares" means the fully paid, non-assessable and freely tradeable common
shares  of the  Corporation  issued  upon  the  conversion  of  the  Convertible
Debentures;

"Convertible  Debenture Trustee" means  Computershare Trust Company of Canada in
its capacity as trustee in respect of the Debentures;

"Convertible  Debenture"  means  $1,000  principal  amount  of 6.0%  convertible
unsecured subordinated  debentures convertible into Common Shares and having the
terms and conditions described in the Preliminary  Prospectus,  provided however
that if the terms and conditions  contained in the Trust  Indenture  differ from
those set forth in the Preliminary  Prospectus,  the terms and conditions of the
Trust Indenture shall prevail;

"Disclosure  Documents"  mean  the  Registration   Statement,   the  Preliminary
Prospectus,   the  U.S.  Preliminary   Prospectus,   the  Amended  and  Restated
Preliminary  Prospectus,  the U.S. Amended and Restated Preliminary  Prospectus,
the Prospectus and the U.S. Prospectus and any Prospectus Amendment and any U.S.
Prospectus Amendment thereto;

"Distribution  Period" means the period commencing on the date hereof and ending
on the completion of the distribution of the Offered Securities;

"Escrow  Agent" means  Computershare  Trust Company of Canada in its capacity as
escrow agent pursuant to the Subscription Receipt Agreement;

"Exchanges" means the TSX and the NYSE;

<PAGE>
                                      -5-

"Final MRRS Decision  Document"  means a decision  document issued in accordance
with the  Mutual  Reliance  Review  System  evidencing  that a  receipt  for the
Prospectus has been issued for each of the Qualifying Provinces;

"Financial Information" has the meaning given to it in paragraph 2.1(c)(i);

"Form F-10" means Form F-10 under the U.S. Securities Act;

"Free Writing  Prospectus" means a free writing  prospectus,  as defined in Rule
405 of the U.S. Securities Act;

"Intellectual Property" means all patents,  copyrights,  trademarks, trade names
(including   applications  for  all  the  foregoing  and  renewals,   divisions,
extensions  and  reissues,  where  applicable,  relating  thereto),  inventions,
licences, trade secrets, patterns,  drawings,  software,  technical information,
research data, concepts,  methods,  procedures,  designs, know-how and all other
intellectual  property,  both foreign and domestic,  owned by or licensed to the
Corporation or its subsidiaries;

"Issuer Free Writing  Prospectus"  means an issuer free writing  prospectus,  as
defined in Rule 433 under the U.S.  Securities Act; provided,  however,  if such
Issuer Free Writing  Prospectus is made by any Underwriter or other third party,
such  Underwriter or other third party has obtained the prior written consent of
the Company with regard to such issuer free writing prospectus;

"Legerity" means, collectively, LHI and Legerity Inc.;

"LHI" means Legerity Holdings, Inc.;

"Merger Sub" means ZLE Inc.;

"Mutual  Reliance  Review  System" or "MRRS"  means the mutual  reliance  review
system provided for under National Policy No. 43-201 of the Canadian  Securities
Administrators;

"Notice" has the meaning given to it in paragraph 21;

"NYSE" means the New York Stock Exchange;

"Offered  Securities"  means the  Subscription  Receipts  and/or the Convertible
Debentures,   as  the  context  provides,   both  of  which  are  qualified  for
distribution by the Disclosure Documents.

"Offering"  means  the  offering  of  the  Subscription   Receipts  or,  if  the
Acquisition  Closing Date occurs before the Offering  Closing Date,  Convertible
Debentures to the public under the Disclosure Documents;

"Offering Closing" means the completion of the issue and sale by the Corporation
of the Subscription  Receipts or, if the Acquisition  Closing Date occurs before
the  Offering  Closing

<PAGE>
                                      -6-

Date,  Convertible  Debentures  and  the  purchase  by the  Underwriters  of the
Subscription Receipts or Convertible Debentures, as applicable, pursuant to this
Agreement;

"Offering  Closing Date" in respect of the Offering  means July 30, 2007 or such
other date as the  Corporation and the  Underwriters  may agree upon in writing,
but in any event not later than September 28, 2007;

"Offering  Closing Time" means 8:00 a.m.  (Toronto time) on the Offering Closing
Date or such other time on the Offering  Closing Date as the Corporation and the
Underwriters may agree upon;

"OSC" means the Ontario Securities Commission;

"Preliminary  Final MRRS Decision  Document" means a decision document issued in
accordance with the Mutual Reliance Review System  evidencing that a receipt for
the Prospectus has been issued for each of the Qualifying Provinces;

"Preliminary  Prospectus" means the English and French language versions (unless
the context indicates otherwise) of the preliminary short form prospectus of the
Corporation  dated July 16,  2007  relating to the  distribution  of the Offered
Securities and, unless the context  otherwise  requires,  includes all documents
incorporated therein by reference and any amendments thereto;

"Prospectus"  means the English and French language versions (unless the context
indicates  otherwise)  of the final  short form  prospectus  of the  Corporation
relating to the  distribution of the Offered  Securities and, unless the context
otherwise requires, includes all documents incorporated therein by reference;

"Prospectus  Amendment"  means the English and French language  versions (unless
the context  indicates  otherwise)  of any amendment to the Amended and Restated
Preliminary  Prospectus,  the U.S. Amended and Restated Preliminary  Prospectus,
the  Prospectus  or  the  U.S.   Prospectus,   any  amendment  to  any  document
incorporated therein by reference,  any amending or supplemental  prospectus and
any other similar document;

"Public Record" means all  information  filed by or on behalf of the Corporation
with the Securities  Commissions  and SEC  including,  without  limitation,  the
Disclosure  Documents  and any  other  information  filed  with  any  Securities
Commission or the SEC in compliance, or intended compliance, with any applicable
Securities Legislation;

"Qualifying  Provinces"  means all of the  provinces  of Canada and  "Qualifying
Province" means any one of them;

"Registration  Statement"  means,   collectively,   the  various  parts  of  the
registration  statement  of  the  Corporation  filed  on  Form  F-10  (File  No.
333-144610),  including all exhibits  thereto and the documents  incorporated by
reference in the prospectus contained in the registration  statement at the time
such part of the registration statement became effective, each as amended at the
time such part of the registration  statement became effective and including any
post effective

<PAGE>
                                      -7-

amendment thereto, and including any prospectus amendment or supplement relating
to the Offered  Securities  and the Common Shares that is filed with the SEC and
deemed part of such registration statement;

"SEC" means the United States Securities and Exchange Commission;

"Securities  Commissions"  means the securities  commissions or other securities
regulatory authorities in the Qualifying Provinces;

"Securities Legislation" means all securities laws, rules, regulations,  notices
and policies  applicable to the  distribution  of the Offered  Securities in the
Qualifying  Provinces  and  the  United  States  including  the  Securities  Act
(Ontario),  the rules and regulations of the Canadian Securities  Administrators
and the OSC, the U.S.  Securities  Act, the U.S.  Exchange Act and the rules and
regulations of the SEC;

"Selling Dealer Group" means the dealers and brokers other than the Underwriters
who participate in the offer and sale of the Offered Securities pursuant to this
Agreement;

"Subscription  Receipt  Agreement"  means the agreement to be dated the Offering
Closing Date and made among the Corporation,  the Lead Underwriter, on behalf of
the Underwriters, and the Escrow Agent governing the terms and conditions of the
Subscription Receipts;

"Subscription Receipts" means subscription receipts each entitling the holder to
receive upon the satisfaction of certain conditions described therein and in the
Subscription  Receipt  Agreement one Convertible  Debenture and having the terms
and conditions set forth in the Preliminary Prospectus, provided however that if
the terms and conditions  contained in the Subscription Receipt Agreement differ
from those set forth in the Preliminary Prospectus,  the terms and conditions of
the Subscription Receipt Agreement shall prevail;

"Subsequent  Disclosure Documents" means any financial statements,  management's
discussion  and  analysis,  information  circulars,  annual  information  forms,
material  change  reports (other than  confidential  material  change  reports),
business  acquisition reports or other documents issued by the Corporation after
the date of this Agreement;

"Trust  Indenture"  means the trust  indenture to be dated the Offering  Closing
Date and made between the  Corporation  and the  Convertible  Debenture  Trustee
governing the terms and conditions of the Convertible Debentures;

"U.S.  Amended and Restated  Preliminary  Prospectus" means the English language
version of the Amended and Restated  Preliminary  Prospectus with such deletions
therefrom  and  additions  thereto as are permitted or required by Form F-10 and
the applicable  rules and regulations of the SEC,  included in the  registration
statement on Form F-10 filed with the SEC;

"TSX" means the Toronto Stock Exchange;

"U.S.  Exchange Act" means the United States Securities Exchange Act of 1934, as
amended;

<PAGE>
                                      -8-

"U.S.  Preliminary  Prospectus"  means  the  English  language  version  of  the
Preliminary  Prospectus with such deletions  therefrom and additions  thereto as
are permitted or required by Form F-10 and the applicable  rules and regulations
of the SEC,  included in the registration  statement on Form F-10 filed with the
SEC;

"U.S.  Prospectus" means the English language version of the Prospectus included
in the Registration  Statement at the time it becomes  effective,  including the
documents incorporated by reference therein;

"U.S. Prospectus Amendment" means the English language version of the Prospectus
Amendment with such deletions  therefrom and additions  thereto as are permitted
or required by Form F-10 and the  applicable  rules and  regulations of the SEC,
included in the registration statement on Form F-10 filed with the SEC;

"U.S.  Securities  Act"  means the  United  States  Securities  Act of 1933,  as
amended; and

"United  States"  means  the  United  States of  America,  its  territories  and
possessions, any State of the United States, and the District of Columbia.

                              TERMS AND CONDITIONS

1.    Compliance with Securities Laws

      1.1   As of the date of this  agreement,  the Corporation has prepared and
            filed:

            (a)   the  Preliminary  Prospectus  with the Securities  Commissions
                  pursuant to applicable Securities  Legislation,  together with
                  the  required  supporting   documents  and  has  received  the
                  Preliminary MRRS Decision Document in respect thereof, and

            (b)   the   Registration   Statement   in  respect  of  the  Offered
                  Securities  and an appointment of agent for service of process
                  on Form F-X (the "Form F-X") in conjunction with the filing of
                  the Registration Statement with the SEC;

      1.2   The Corporation covenants and agrees to prepare and file:

            (a)   the Amended and Restated  Preliminary  Prospectus and the U.S.
                  Amended and Restated Preliminary Prospectus and the Prospectus
                  and the U.S.  Prospectus  and comply in all respects  with the
                  MRRS within the following time limits:

                  (i)   the  Amended and  Restated  Preliminary  Prospectus  and
                        related documents, in form and substance satisfactory to
                        the Underwriters, shall have been filed with the Ontario
                        Securities   Commission   (the   "OSC"),   as  principal
                        jurisdiction, no later than 12:00 p.m. (Toronto time) on
                        July 18,  2007 (or such  other time  and/or  date as

<PAGE>
                                      -9-

                        the Corporation and the  Underwriters may agree) and the
                        Amended and Restated  Preliminary MRRS Decision Document
                        dated as of such  date  shall be  obtained  from the OSC
                        evidencing  that a receipt for the Amended and  Restated
                        Preliminary   Prospectus  in  each  of  the   Qualifying
                        Provinces has been issued;

                  (ii)  concurrent  therewith,  the U.S.  Amended  and  Restated
                        Preliminary  Prospectus with the SEC pursuant to General
                        Instruction II.L. of the Form F-10 and otherwise fulfill
                        all legal  requirements to enable the Offered Securities
                        to be  offered  and  sold to the  public  in the  United
                        States;

                  (iii) the  Prospectus  and  related  documents,  in  form  and
                        substance  satisfactory  to the  Underwriters,  shall be
                        filed no later than 12:00  p.m.  (Toronto  time) on July
                        24,  2007  (or  such  other  time  and/or  date  as  the
                        Corporation  and the  Underwriters  may  agree)  and the
                        Final MRRS Decision Document dated as of such date shall
                        be obtained from the OSC  evidencing  that a receipt for
                        the Prospectus in each of the  Qualifying  Provinces has
                        been issued; and

                  (iv)  concurrent  therewith,  the U.S. Prospectus with the SEC
                        pursuant to General  Instruction  II.L. of Form F-10 and
                        otherwise  fulfill all legal  requirements to enable the
                        Offered  Securities to be offered and sold to the public
                        in the United States.

      1.3   The  Corporation  will promptly take all other steps and proceedings
            that may be necessary in order to qualify the Offered Securities for
            distribution  in each of the  Qualifying  Provinces  and the  United
            States by the Underwriters and the Selling Dealer Group.

      1.4   Until the date on which the  distribution of the Offered  Securities
            is completed,  the  Corporation  will promptly  take, or cause to be
            taken,  all additional  steps and proceedings  that may from time to
            time be required  under the  Securities  Legislation  to continue to
            qualify the distribution of the Offered  Securities or, in the event
            that the  Offered  Securities  have,  for any  reason,  ceased so to
            qualify,   to  so  qualify   again  the  Offered   Securities,   for
            distribution  in each of the  Qualifying  Provinces  and the  United
            States.

      1.5   Each of the  Underwriters,  within  the  Distribution  Period,  will
            notify the Lead Underwriter and the Lead Underwriter will notify the
            Corporation,  in writing, when, in its opinion,  distribution of the
            Offered  Securities has terminated.  Each of the  Underwriters  will
            notify the Lead Underwriter and the Lead Underwriter will notify the
            Corporation,  in writing,  of the amount of the  Offered  Securities
            sold in each  Qualifying  Province  and the United  Sates as soon as
            possible  after the Offering  Closing Date and  Additional  Offering
            Closing Date, if  applicable,

<PAGE>
                                      -10-

            where such breakdown is required for the purpose of calculating fees
            payable to Securities Commissions and the SEC.

2.    Delivery of Prospectus and Related Documents

      2.1   The  Corporation  shall  deliver  or  cause to be  delivered  to the
            Underwriters  and the  Underwriters'  counsel the  documents set out
            below at the respective times indicated:

            (a)   prior to or contemporaneously,  as nearly as practicable, with
                  the filing with the Securities  Commissions and SEC of each of
                  the  Amended and  Restated  Preliminary  Prospectus,  the U.S.
                  Amended and Restated  Preliminary  Prospectus,  the Prospectus
                  and the U.S. Prospectus:

                  (i)   copies  of  the   Amended   and   Restated   Preliminary
                        Prospectus and the  Prospectus,  each in the English and
                        French  languages,  signed as required by the Securities
                        Legislation  of the  Qualifying  Provinces and copies of
                        any documents  incorporated  by reference  therein which
                        have not previously been delivered to the  Underwriters;
                        and

                  (ii)  copies of the Registration Statement, including the U.S.
                        Amended and  Restated  Preliminary  Prospectus  and U.S.
                        Prospectus,  and each amendment  thereto,  as filed with
                        the SEC and copies of all exhibits and  documents  filed
                        therewith  which have not  previously  been delivered to
                        the Underwriters;

            (b)   as soon as they  are  available,  copies  of the  English  and
                  French  language  versions,  as applicable,  of any Prospectus
                  Amendment and copies of any U.S. Prospectus Amendment required
                  to be filed under Securities Legislation signed as required by
                  the Securities  Legislation  of the  Qualifying  Provinces and
                  including,   in  each  case,   copies  of  any   documents  or
                  information  incorporated by reference  therein which have not
                  been previously delivered to the Underwriters;

            (c)   at the time of the  delivery to the  Underwriters  pursuant to
                  this  paragraph  2.1 of the  French  language  version  of the
                  Amended and Restated Preliminary Prospectus or the Prospectus:

                  (i)   opinions   of  counsel  in  Quebec   addressed   to  the
                        Corporation,   the  Underwriters  and  their  respective
                        counsel and dated the date of the  Amended and  Restated
                        Preliminary  Prospectus or  Prospectus,  as the case may
                        be,  to the  effect  that the  French  language  version
                        thereof  and of any  documents  incorporated  therein by
                        reference  (except  for  any  financial  statements  and
                        financial  information  which  are  the  subject  of the
                        opinion  of  the   auditors   referred   to

<PAGE>
                                      -11-

                        below  (the  "Financial  Information"),  as to  which no
                        opinion need be expressed by Quebec  counsel) are in all
                        material  respects a complete and proper  translation of
                        the  English  language  version  thereof  and that  such
                        English and French language versions are not susceptible
                        to any materially different  interpretation with respect
                        to any matter contained therein; and

                  (ii)  an opinion of the Corporation's and Legerity's  auditors
                        addressed to the Corporation, the Underwriters and their
                        respective counsel and dated the date of the Amended and
                        Restated  Preliminary  Prospectus or Prospectus,  as the
                        case may be,  to the  effect  that the  French  language
                        version of the Financial  Information  set forth therein
                        or incorporated  therein by reference is in all material
                        respects  a  complete  and  proper  translation  of  the
                        English  language  version thereof and that such English
                        and French language  versions are not susceptible to any
                        materially different  interpretation with respect to any
                        matter contained therein;

            (d)   at the time of delivery to the  Underwriters  pursuant to this
                  paragraph  2.1 of the  Prospectus,  a comfort  letter from the
                  Corporation's and Legerity's  auditors,  dated the date of the
                  Prospectus and addressed to the  Underwriters and the Board of
                  Directors of the  Corporation  and reasonably  satisfactory in
                  form and  substance to the  Underwriters,  with respect to the
                  financial  and  accounting   information  in  respect  of  the
                  Corporation and Legerity and other numerical data contained in
                  or incorporated by reference in the Prospectus,  which comfort
                  letter  shall be based on a review  by the  auditors  having a
                  cut-off date not more than two business days prior to the date
                  of the comfort  letter and shall be in addition to any comfort
                  letters which must be filed with  Securities  Commissions  and
                  SEC pursuant to applicable Securities Legislation;

            (e)   at the time of the filing of the Prospectus, a letter from the
                  TSX advising the Corporation that conditional listing approval
                  for the  Subscription  Receipts,  Convertible  Debentures  and
                  Common Shares has been granted; and

            (f)   at the time of the  U.S.  Prospectus,  a letter  from the NYSE
                  advising the Corporation that conditional listing approval for
                  the Common Shares has been granted.

            Opinions  or  comfort  letters  similar  to the  foregoing  shall be
            provided  to  the  Underwriters   with  respect  to  any  Prospectus
            Amendment  filed  pursuant to paragraph  5.2 and any other  relevant
            document that may be translated into the French language at the time
            the same is presented to the Underwriters for their signature or, if
            the Underwriters' signature is not required, at the time the same is

<PAGE>
                                      -12-

            filed.  All such  opinions or comfort  letters  shall be in form and
            substance  reasonably  satisfactory  to the  Underwriters  and their
            counsel.

      2.2   The  Corporation  shall,  as soon as  possible  but in any event not
            later than:

            (a)   48 hours  following  the filing of the  Amended  and  Restated
                  Preliminary  Prospectus  and the  U.S.  Amended  and  Restated
                  Preliminary  Prospectus,  with  respect  to  the  Amended  and
                  Restated  Preliminary  Prospectus  and the  U.S.  Amended  and
                  Restated Preliminary Prospectus;

            (b)   48 hours  following the filing of the  Prospectus and the U.S.
                  Prospectus,  with  respect  to the  Prospectus  and  the  U.S.
                  Prospectus; and

            (c)   48 hours following the filing of any Prospectus  Amendment and
                  U.S. Prospectus Amendment (if applicable),

            cause  to  be  delivered  to  the   Underwriters,   without  charge,
            commercial   copies  of  the   Amended  and   Restated   Preliminary
            Prospectus,  the U.S. Amended and Restated  Preliminary  Prospectus,
            the Prospectus, the U.S. Prospectus and any Prospectus Amendment and
            U.S.  Prospectus  Amendment in such  numbers and in such cities,  as
            applicable,  as the Underwriters  may reasonably  request by written
            instructions  to the  printer  thereof  given no later than the time
            when the  Corporation  authorizes  the  printing  of the  commercial
            copies of such documents.

      2.3   The Corporation  shall cause to be provided to the Underwriters such
            number of copies of any documents  incorporated  by reference in the
            Amended and Restated  Preliminary  Prospectus,  the U.S. Amended and
            Restated Preliminary Prospectus, the Prospectus, the U.S. Prospectus
            or any  Prospectus  Amendment and U.S.  Prospectus  Amendment as the
            Underwriters  may  reasonably  request  for use in  connection  with
            offering  the  Offered   Securities   represented   thereby  in  the
            Qualifying  Provinces and the United States.  The Underwriters agree
            severally,  not jointly, that the Underwriters will not, directly or
            indirectly,  use or distribute,  and will require each member of the
            Selling  Dealer Group not to so use or  distribute,  the Amended and
            Restated  Preliminary  Prospectus,  the U.S.  Amended  and  Restated
            Preliminary  Prospectus,  the Prospectus,  the U.S. Prospectus,  any
            Prospectus Amendment and U.S. Prospectus Amendment,  nor offer, sell
            or deliver any of the Offered Securities  represented thereby in any
            country or jurisdiction  except under circumstances that will result
            in compliance with the applicable laws and regulations thereof.

3.    Delivery Constitutes Representation and Consent

      3.1   Delivery of the Amended and  Restated  Preliminary  Prospectus,  the
            U.S. Amended and Restated  Preliminary  Prospectus,  the Prospectus,
            the U.S. Prospectus and any Prospectus Amendment and U.S. Prospectus
            Amendment

<PAGE>
                                      -13-

            shall constitute a representation and warranty by the Corporation to
            the Underwriters that at the time of delivery:

            (a)   all  information  and  statements   (except   information  and
                  statements  relating  solely  to the  Underwriters)  contained
                  therein  are true in all  material  respects  and  contain  no
                  misrepresentation   and  constitute   full,   true  and  plain
                  disclosure  of all  material  facts  relating  to the  Offered
                  Securities;

            (b)   no material fact has been omitted from such document  which is
                  required  to be stated  therein  or is  necessary  to make the
                  statements or information  contained therein not misleading in
                  light of the circumstances in which they were made; and

            (c)   such  document  complies  in all  material  respects  with the
                  requirements of the Securities Legislation.

      3.2   Such deliveries shall also constitute the consent and  authorization
            of the Corporation to the use by the Underwriters of the Amended and
            Restated  Preliminary  Prospectus,  the U.S.  Amended  and  Restated
            Preliminary Prospectus,  the Prospectus, the U.S. Prospectus and any
            Prospectus Amendment and U.S. Prospectus Amendment,  as the case may
            be, in connection with the distribution of the Offered Securities in
            compliance with this Agreement.

4.    Representations and Covenants of Underwriters

      4.1   The Underwriters  shall offer the Offered Securities for sale to the
            public,  directly  and  through  the  Selling  Dealer  Group only in
            compliance with applicable Securities Legislation and upon the terms
            and  conditions  set forth in the Amended and  Restated  Preliminary
            Prospectus,  the U.S. Amended and Restated  Preliminary  Prospectus,
            the Prospectus,  the U.S.  Prospectus,  any Prospectus Amendment and
            U.S. Prospectus Amendment and this Agreement. The Underwriters shall
            be entitled to assume that the Offered  Securities are qualified for
            distribution (i) in any Qualifying Province where a Preliminary MRRS
            Decision  Document,  an Amended and Restated MRRS Decision  Document
            and  Final  MRRS  Decision  Document  has  been  obtained  from  the
            applicable  Securities  Commission;  and (ii) in the United  States,
            unless,  in  each  case,  the  Underwriters  receive  notice  to the
            contrary  from  the   Corporation  or  the   applicable   Securities
            Commission  or the SEC. The  Underwriters  shall use all  reasonable
            efforts  to  complete  and to  cause  the  Selling  Dealer  Group to
            complete  the  distribution  of the  Offered  Securities  as soon as
            possible after the Offering Closing Time, subject to the termination
            provisions contained herein.

      4.2   Except  in the  Qualifying  Provinces  and the  United  States,  the
            Underwriters  will not,  directly or  indirectly,  solicit offers to
            purchase or sell the Offered  Securities  or deliver the Amended and
            Restated  Preliminary  Prospectus,  the U.S.  Amended  and  Restated
            Preliminary  Prospectus,  the Prospectus,  the U.S. Prospectus,  any

<PAGE>
                                      -14-

            Prospectus  Amendment or U.S. Prospectus  Amendment so as to require
            registration  of the Offered  Securities  or filing of a  prospectus
            with  respect  to the  Offered  Securities  under  the  laws  of any
            jurisdiction,  and the Underwriters will require each Selling Dealer
            Group member to agree to the same.

      4.3   The Underwriters  shall not make any  representations  or warranties
            with respect to the Corporation,  the Offered  Securities other than
            as set forth in the Amended and Restated Preliminary Prospectus, the
            U.S. Amended and Restated  Preliminary  Prospectus,  the Prospectus,
            the U.S. Prospectus and any Prospectus Amendment and U.S. Prospectus
            Amendment.

      4.4   The Underwriters will complete and will use their reasonable efforts
            to  cause  members  of the  Selling  Dealer  Group to  complete  the
            distribution of the Offered  Securities  promptly after the Offering
            Closing  and,  with  respect to the  exercise of the  over-allotment
            option, the Additional Offering Closing Time.

      4.5   No  Underwriter  shall be liable under this paragraph 4 with respect
            to a default  by any of the other  Underwriters  or by any member of
            the  Selling  Dealer  Group  not  appointed  by  any  of  the  other
            Underwriters.

5.    Material Change During Distribution

      5.1   During the  Distribution  Period,  the  Corporation  shall  promptly
            notify the Lead Underwriter in writing of the full particulars of:

            (a)   any change (actual,  anticipated,  contemplated or threatened,
                  financial or otherwise) in the business, affairs,  operations,
                  assets,  prospects,  liabilities  (contingent  or  otherwise),
                  capital, ownership or control of the Corporation,  Legerity or
                  any of their respective  subsidiaries,  that would be material
                  to the Corporation, Legerity and their respective subsidiaries
                  taken as a whole; and

            (b)   any  change  in  any  material  fact  or any  misstatement  or
                  omission of any material fact in the  Disclosure  Documents or
                  any Subsequent Disclosure  Documents,  or the existence of any
                  new material fact not disclosed in the Disclosure Documents or
                  any Subsequent Disclosure Documents,

            which change, misstatement, omission or new material fact is, or may
            be,  of  such  a  nature  as  to  render  the  Disclosure  Documents
            misleading  or untrue in any  material  respect or would result in a
            misrepresentation   therein  or  would  result  in  the   Disclosure
            Documents not complying in any material  respect with any Securities
            Legislation or which change, misstatement or new material fact would
            reasonably be expected to have a material effect on the market price
            or value of the Offered Securities.

<PAGE>
                                      -15-

      5.2   The  Corporation  shall  promptly,  and  in  any  event  within  any
            applicable time limitation,  comply, to the reasonable  satisfaction
            of  the  Underwriters,   with  all  applicable   filings  and  other
            requirements  under the  Securities  Legislation  in the  Qualifying
            Provinces  and the United  States  and the rules and  by-laws of the
            Exchanges  arising as a result of such change,  misstatement  or new
            material  fact  referred  to in  paragraph  5.1,  provided  that the
            Corporation  shall  not  file  any  Prospectus  Amendment  and  U.S.
            Prospectus  Amendment  or other  document  relating  to the  Offered
            Securities without first obtaining the approval of the Underwriters,
            after  consultation  with the Underwriters  with respect to the form
            and content thereof which approval will not be unreasonably withheld
            or delayed.  The  Corporation  shall in good faith  discuss with the
            Underwriters  any  such  fact,  misstatement  or new  material  fact
            (actual,  contemplated or threatened,  financial or otherwise) which
            is of such a nature that there is reasonable  doubt whether  written
            notice need be given under this  paragraph.  The  Corporation  shall
            allow the Underwriters to conduct all "due diligence" investigations
            which, in the reasonable  opinion of the Underwriters,  are required
            in order to  responsibly  execute  any  certificate  required  to be
            executed by the  Underwriters  in any Prospectus  Amendment and U.S.
            Prospectus  Amendment.  The  Corporation  shall promptly  deliver or
            cause  to  be  delivered  to  each  of  the   Underwriters  and  the
            Underwriters'  counsel a copy of each Prospectus  Amendment and U.S.
            Prospectus  Amendment,  signed as required by applicable  Securities
            Legislation by all parties other than the  Underwriters,  as well as
            opinions and letters with respect to each such Prospectus  Amendment
            and U.S.  Prospectus  Amendment to the same effect as those referred
            to in  paragraph 2 and dated the date of such  Prospectus  Amendment
            and U.S. Prospectus Amendment.

      5.3   The delivery to the Underwriters of a Prospectus  Amendment and U.S.
            Prospectus  Amendment shall constitute a representation and warranty
            to  the   Underwriters  by  the  Corporation  with  respect  to  the
            Disclosure  Documents,  as the case may be, as amended,  modified or
            superseded  by  such  Prospectus   Amendment  and  U.S.   Prospectus
            Amendment  and by each  Prospectus  Amendment  and  U.S.  Prospectus
            Amendment previously delivered to the Underwriters as aforesaid,  to
            the same effect as set forth in  paragraph  3. Such  delivery  shall
            also constitute the consent and  authorization of the Corporation to
            the use of the relevant Disclosure Documents, as the case may be, as
            so amended,  by the Underwriters in connection with the distribution
            of the Offered Securities in the Qualifying Provinces and the United
            States.

      5.4   The  Corporation  shall  deliver  or  cause to be  delivered  to the
            Underwriters,  as soon as practicable,  as many commercial copies of
            any Prospectus Amendment and U.S. Prospectus Amendment in the cities
            in  the   Qualifying   Provinces   and  the  United  States  as  the
            Underwriters may reasonably request.

<PAGE>
                                      -16-

6.    Representations, Warranties and Covenants of the Corporation

      6.1   Representations and Warranties of the Corporation

            The Corporation represents and warrants to each of the Underwriters,
            and  acknowledges  that  the  Underwriters  are  relying  upon  such
            representations  and  warranties in entering into this Agreement and
            purchasing the Offered Securities, that:

            (a)   the Corporation and each of its  subsidiaries is a corporation
                  duly incorporated and organized and validly existing under the
                  laws of its jurisdiction of  incorporation,  is duly qualified
                  to  carry  on its  business  and is in good  standing  in each
                  jurisdiction  in which  the  conduct  of its  business  or the
                  ownership,  leasing or  operation  of its  property and assets
                  requires  such  qualification,  except  where such  failure to
                  qualify would not have a material adverse effect,  and has all
                  requisite  corporate  power  and  authority  to  carry  on its
                  business,  to own,  lease and operate its  property and assets
                  and, in the case of the Corporation,  to execute,  deliver and
                  perform its obligations under this Agreement;

            (b)   this  Agreement  has  been  duly   authorized,   executed  and
                  delivered  by  the  Corporation;   the  Subscription   Receipt
                  Agreement  will  have  been  duly  authorized,   executed  and
                  delivered by the Corporation at the Offering Closing Date; the
                  Trust Indenture will have been duly  authorized,  executed and
                  delivered by the Corporation at the Offering Closing Date; and
                  this Agreement,  the  Subscription  Receipt  Agreement and the
                  Trust Indenture when so executed shall constitute legal, valid
                  and binding obligations of the Corporation enforceable against
                  the  Corporation  in accordance  with their terms,  subject to
                  bankruptcy,  insolvency and other laws affecting the rights of
                  creditors generally, the qualification that equitable remedies
                  may be granted only in the  discretion of a court of competent
                  jurisdiction  and that  rights  to  indemnity  and  waiver  of
                  contribution may be limited by applicable law;

            (c)   the  authorized  capital  of the  Corporation  consists  of an
                  unlimited  number of common  shares of which  127,345,682  are
                  issued and outstanding as fully paid and non-assessable and an
                  unlimited number of redeemable  preferred shares,  issuable in
                  series, of which 1,193,600 are issued and outstanding as fully
                  paid  and  non-assessable   and,  except  in  respect  of  the
                  Convertible   Debentures   issuable  in  accordance  with  the
                  Subscription Receipt Agreement and the Trust Indenture and the
                  Common  Shares  issuable upon  conversion  of the  Convertible
                  Debentures and as otherwise  disclosed in or  contemplated  by
                  the  Disclosure  Documents,  as the case may be,  no person or
                  other  entity has any  agreement,  option,  right or privilege
                  (whether  pre-emptive or  contractual)  capable of becoming an

<PAGE>
                                      -17-

                  agreement  for or the right to  purchase  any of the issued or
                  unissued securities of the Corporation;

            (d)   the execution,  delivery, performance of and compliance by the
                  Corporation with the terms of this Agreement, the Subscription
                  Receipt  Agreement  and the Trust  Indenture and the issuance,
                  sale and  delivery of the Offered  Securities  as described in
                  and  contemplated by the Disclosure  Documents do not and will
                  not  result in a breach  of,  and do not and will not create a
                  state of facts  which,  after notice or lapse of time or both,
                  will  result in a breach of, and do not and will not  conflict
                  with  any  of  the  terms,  conditions  or  provisions  of its
                  articles,  by-laws  or  resolutions  of  its  shareholders  or
                  directors  (or  any  committee  thereof),  or  any  indenture,
                  agreement or  instrument to which it is a party or by which it
                  is contractually bound;

            (e)   the  Corporation  is not  aware  of any  legislation  which it
                  anticipates   may   materially   and   adversely   affect  (as
                  applicable)  the  business,   affairs,   operations,   assets,
                  liabilities  (contingent  or  otherwise)  or  prospects of the
                  Corporation and its subsidiaries taken as a whole;

            (f)   there is no action,  proceeding or  investigation  (whether or
                  not  purportedly  on behalf of any of the  Corporation  or its
                  subsidiaries)  commenced  against or, to the  knowledge of the
                  Corporation or its subsidiaries,  pending or, to the knowledge
                  of the Corporation, threatened against or affecting any of the
                  Corporation or its subsidiaries, at law or in equity or before
                  or by any federal, provincial, municipal or other governmental
                  department,  commission, board or agency, domestic or foreign,
                  which could in any way materially  adversely affect any of the
                  Corporation  or its  subsidiaries  taken  as a  whole,  or the
                  condition  (financial or otherwise) of the  Corporation or its
                  subsidiaries,  taken  as  a  whole,  or  which  questions  the
                  validity of the issuance of the Offered  Securities  or Common
                  Shares  or  of  any  action  taken  or  to  be  taken  by  the
                  Corporation  pursuant to or in connection with this Agreement,
                  the Subscription Receipt Agreement, the Trust Indenture or any
                  agreement  contemplated  hereby,  or  which  would  materially
                  adversely   affect  the   consummation  of  the   transactions
                  contemplated by the Disclosure Documents;

            (g)   other  than as  disclosed  in the  Disclosure  Documents,  the
                  Corporation  and its  subsidiaries  are in compliance with all
                  material  covenants under, and no material default on the part
                  of any of such parties exists under any instrument securing or
                  otherwise  relating to any  indebtedness of the Corporation or
                  its  subsidiaries,  which  in any  case  materially  adversely
                  affects,  or would  reasonably  be expected to have a material
                  adverse  effect on, the market  price or value of the  Offered
                  Securities or Common Shares;

<PAGE>
                                      -18-

            (h)   all of the financial statements (audited and unaudited) of the
                  Corporation (other than the pro forma financial  statements of
                  the Corporation) contained or incorporated by reference in the
                  Disclosure  Documents  are,  as  at  their  respective  dates,
                  complete and correct in all material respects,  were prepared,
                  in accordance with United States generally accepted accounting
                  principles  consistently  applied  and  present  fairly in all
                  material  respects the  financial  position,  the earnings and
                  cash flows, including contingent liabilities,  of the entities
                  to which such financial  statements  relate as at the date and
                  for the periods stated therein;

            (i)   the  pro  forma  financial   statements  of  the  Corporation,
                  including  the  notes  thereto,  contained  in the  Disclosure
                  Documents have been prepared and presented in accordance  with
                  applicable   Securities   Legislation   and  the   assumptions
                  contained in such pro forma financial  statements are suitably
                  supported and  consistent  with the  financial  results of the
                  Corporation  and  Legerity,  and  such  statements  provide  a
                  reasonable   basis  for  the  compilation  of  the  pro  forma
                  financial  statements and such pro forma financial  statements
                  accurately  reflect such  assumptions.  The Corporation is not
                  aware of any facts,  information  or  circumstances  presently
                  existing which could render the pro forma financial statements
                  of the Corporation incorrect in any material respect;

            (j)   the Corporation has provided the Underwriters with full access
                  to all due diligence materials and information  provided to it
                  by Legerity and their agents or independently  compiled by the
                  Corporation  and its agents with  respect to Legerity  and the
                  Acquisition and is not aware of any misrepresentations in such
                  material or information  which could upon or after  completion
                  of the  Acquisition  reasonably be expected to have a material
                  adverse effect;

            (k)   the  Corporation is not aware of any  information  relating to
                  Legerity  and the  Acquisition  which  could,  upon  or  after
                  completion of the Acquisition,  reasonably be expected to have
                  a material adverse effect on the Corporation;

            (l)   other than as disclosed in the Disclosure Documents, there are
                  no contingent  liabilities or other obligations  affecting the
                  Corporation  or its  subsidiaries  which are  material  to the
                  Corporation and its subsidiaries taken as a whole;

            (m)   each of the Corporation and its subsidiaries has good title to
                  all of its material assets and undertakings, free and clear of
                  adverse   claims,   except  as  disclosed  in  the  Disclosure
                  Documents, or those arising in the ordinary course of business
                  which are not material in the aggregate;

<PAGE>
                                      -19-

            (n)   each of the Corporation and its subsidiaries has conducted, is
                  conducting  and will conduct its business in compliance in all
                  material   respects  with  all  applicable   laws,  rules  and
                  regulations and, in particular,  all applicable  licensing and
                  environmental  legislation,  regulations  or  by-laws or other
                  lawful  requirements of any governmental or regulatory  bodies
                  applicable to it of each jurisdiction in which it carries on a
                  material  portion  of its  business  and holds  all  licences,
                  registrations and qualifications in all jurisdictions in which
                  it  carries on a material  portion of its  business  which are
                  necessary  or  desirable  to  carry  on  the  business  of the
                  Corporation and its  subsidiaries,  as the case may be, as now
                  conducted and as presently proposed to be conducted,  all such
                  licences,   registrations  or  qualifications  are  valid  and
                  existing  and in good  standing  and  none  of such  licences,
                  registrations or qualifications  contains any burdensome term,
                  provision,  condition or limitation  which has or is likely to
                  have  any  material  adverse  effect  on the  business  of the
                  Corporation  or its  subsidiaries  (taken  as a whole)  as now
                  conduction or as proposed to be conducted, and the Corporation
                  is not aware of any  legislation,  regulation,  rule or lawful
                  requirements presently in force or proposed to be brought into
                  force with which the  Corporation  anticipates the Corporation
                  or  its   subsidiaries   will  be  unable  to  comply  without
                  materially adversely affecting the Corporation;

            (o)   (i)  except as  disclosed  in the  Disclosure  Documents,  the
                  Corporation and each of its subsidiaries has the right to use,
                  or has good and valid right, title and interest in and to, the
                  Intellectual  Property,  free and  clear  of all  encumbrances
                  except as in the ordinary course of business,  as is necessary
                  to  conduct   the   business  of  the   Corporation   and  its
                  subsidiaries  as  it  is  currently  conducted;  (ii)  to  the
                  knowledge of the  Corporation,  the conduct of the business of
                  the  Corporation and its  subsidiaries  does not infringe upon
                  the  Intellectual  Property  of any  other  person;  (iii) the
                  Intellectual Property which is not owned by the Corporation or
                  its  subsidiaries  is  being  used by the  Corporation  or its
                  subsidiaries  only with the consent of or licence from, to the
                  knowledge of the Corporation, the rightful owners thereof, and
                  all such  licences  are in full  force  and  effect;  (iv) the
                  Corporation and each of its  subsidiaries has not received any
                  written  claim of adverse  ownership,  invalidity or any other
                  opposition to or conflict with any  Intellectual  Property nor
                  any  pending  or,  to  the   knowledge  of  the   Corporation,
                  threatened  suit,   proceeding,   claim,  demand,   action  or
                  investigation of any nature or kind against the Corporation or
                  any of its subsidiaries relating to the Intellectual Property;
                  (v) to  the  knowledge  of  the  Corporation,  no  person  has
                  infringed   or   misappropriated,    or   is   infringing   or
                  misappropriating,   any  rights  of  the  Corporation  or  its
                  subsidiaries  in or to any  Intellectual  Property;  and  (vi)
                  there  are no  material  restrictions  on the  ability  of the
                  Corporation or its  subsidiaries to use,  exploit or authorize
                  others  to use and  exploit  all  rights  in the

<PAGE>
                                      -20-

                  Intellectual  Property,  other than in the ordinary  course of
                  business with respect to Intellectual  Property  licensed from
                  third  parties.  None of the rights of the  Corporation or its
                  subsidiaries in the Intellectual  Property will be impaired or
                  affected in any way by the  transactions  contemplated  by the
                  Acquisition Agreement;

            (p)   except  as  disclosed  in  the   Disclosure   Documents,   the
                  Corporation  is not  aware of a claim of any  infringement  or
                  breach  by  the   Corporation  or  its   subsidiaries  of  any
                  Intellectual  Property rights of any other person, nor has the
                  Corporation or its subsidiaries received any notice nor is the
                  Corporation  otherwise aware that the use of the  Intellectual
                  Property of the Corporation or its subsidiaries infringes upon
                  or  breaches  any  Intellectual  Property  rights of any other
                  person;

            (q)   the  proceeds   received   from  the  Offering  will  be  used
                  substantially  in  the  manner  described  in  the  Disclosure
                  Documents;

            (r)   after giving effect to the Acquisition, the shares of Legerity
                  will be indirectly owned by the Corporation,  to the knowledge
                  of the  Corporation,  free and clear of all liens,  except for
                  any liens created in the ordinary course of business;

            (s)   Computershare  Investor Services Inc., at its principal office
                  in the City of Toronto, Ontario is the duly appointed transfer
                  agent of the Common Shares, and Computershare Trust Company of
                  Canada,  at the Offering  Closing  Date and at the  Additional
                  Offering  Closing  Date,  if  applicable,  will  be  the  duly
                  appointed Escrow Agent and Convertible Debenture Trustee under
                  the  Subscription  Receipt  Agreement and the Trust Indenture,
                  respectively;

            (t)   since  March  30,  2007,   other  than  as  disclosed  in  the
                  Disclosure Documents:

                  (i)   there  has  not  been  any  material   change   (actual,
                        anticipated,  proposed or prospective, whether financial
                        or  otherwise)  in  the  investments,  affairs,  assets,
                        prospects or  liabilities  (contingent  or otherwise) of
                        the  Corporation  or its  subsidiaries  taken as a whole
                        that has not been publicly disclosed;

                  (ii)  there has not been any  material  change  in the  equity
                        capitalization  or long-term or  short-term  debt of the
                        Corporation  or its  subsidiaries  taken as a whole that
                        has not been publicly disclosed;

                  (iii) there has not been any material  change in the business,
                        business prospects,  condition  (financial or otherwise)
                        or results of the

<PAGE>
                                      -21-

                        operations of the Corporation or its subsidiaries  taken
                        as a whole that has not been publicly disclosed; and

                  (iv)  the  Corporation  and its  subsidiaries  have carried on
                        their  businesses  in  the  ordinary  course  and in the
                        manner described in the Disclosure Documents;

            (u)   the  Corporation  is a  "reporting  issuer"  in  each  of  the
                  Qualifying  Provinces and is not in default  under  Securities
                  Legislation in such provinces, in particular, without limiting
                  the foregoing,  the Corporation is in material compliance with
                  its  obligations  to make timely  disclosure  of all  material
                  changes relating to it and since March 30, 2007 (other than in
                  respect of material  change  reports  filed on a  confidential
                  basis and  thereafter  made public or material  change reports
                  filed on a  confidential  basis  and in  respect  of which the
                  material change never came to fruition) no such disclosure has
                  been made on a  confidential  basis  and there is no  material
                  change relating to the Corporation or its  subsidiaries  which
                  has occurred and with respect to which the requisite  material
                  change report has not been filed;

            (v)   the  documents  incorporated  by reference in the  Preliminary
                  Prospectus,   the   Registration   Statement   and  the   U.S.
                  Preliminary  Prospectus,  conformed in all  material  respects
                  with the applicable requirements of Securities Legislation and
                  did not contain 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,  in light of the
                  circumstances under which they were made, not misleading;  and
                  any further  documents so filed and  incorporated by reference
                  in the other  Disclosure  Documents,  when such  documents are
                  filed  with  the   Securities   Commissions  or  the  SEC,  as
                  applicable,  will  conform in all material  respects  with the
                  applicable requirements of Securities Legislation and will not
                  contain  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,  in light of the
                  circumstances under which they were made, not misleading;

            (w)   the  Corporation  is  not  and,  after  giving  effect  to the
                  offering   and  sale  of  the  Offered   Securities   and  the
                  application  of the proceeds as  described  in the  Disclosure
                  Documents  under the heading "Use of Proceeds," will not be an
                  "investment   company"   as  defined  in  the  United   States
                  Investment Company Act of 1940, as amended,  and the rules and
                  regulations of the SEC promulgated thereunder;

            (x)   there  is  no  franchise,  contract  or  other  document  of a
                  character   required  to  be  described   in  the   Disclosure
                  Documents,  or to be filed as an exhibit thereto, which is not
                  described  or filed as  required;  and the  statements  in the
                  Disclosure  Documents  under the headings  "Description of the

<PAGE>
                                      -22-

                  Securities  Being  Distributed"  and  "Plan  of  Distribution"
                  insofar   as  such   statements   summarize   legal   matters,
                  agreements,  documents or proceedings  discussed therein,  are
                  accurate and fair summaries of such legal matters, agreements,
                  documents or proceedings in all material respects;

            (y)   the Corporation  will promptly file all reports required to be
                  filed  by it with the  Securities  Commissions  and SEC  under
                  applicable  Securities  Legislation  in  connection  with  the
                  Offering  or sale of the Offered  Securities,  and during such
                  same period will advise the Lead  Underwriter,  promptly after
                  it receives notice thereof,  of the issuance by the Securities
                  Commissions  or the  SEC of any  stop  order  or of any  order
                  preventing or suspending the use of any prospectus relating to
                  the  Offered   Securities  and  the  Common  Shares,   of  the
                  suspension of the qualification of such Offered Securities and
                  the  Common  Shares  for  offering  or  sale  in  any  of  the
                  Qualifying  Provinces or the United States,  of the initiation
                  or  threat,  to  the  knowledge  of  the  Corporation,  of any
                  proceeding  for any such  purpose,  or of any  request  by the
                  Securities   Commissions  or  the  SEC  for  the  amending  or
                  supplementing of the Registration  Statement or the Disclosure
                  Documents  or  for  additional  information  relating  to  the
                  Offered   Securities;   and  the  Corporation   will  use  its
                  commercially reasonable efforts to prevent the issuance of any
                  such stop order or any such order preventing or suspending the
                  use of any prospectus  relating to the Offered  Securities and
                  the Common Shares or the suspension of any such  qualification
                  and, in the event of the issuance of any such stop order or of
                  any  such  order  preventing  or  suspending  the  use  of any
                  prospectus  relating to the Offered  Securities and the Common
                  Shares  or  suspending  any  such  qualification,  to use  its
                  commercially  reasonable  efforts to obtain the  withdrawal of
                  such order as soon as possible;

            (z)   as soon as practicable,  the  Corporation  will make generally
                  available  to its  security  holders an earnings  statement or
                  statements of the Corporation and its subsidiaries  which will
                  satisfy the provisions of Section 11(a) of the U.S. Securities
                  Act and Rule 158 thereunder;

            (aa)  unless the Corporation and the Underwriters otherwise agree in
                  writing,  the  Corporation  has not made and will not make any
                  offer relating to the Offered Securities and the Common Shares
                  that would  constitute  an Issuer Free Writing  Prospectus  or
                  that would  otherwise  constitute a "free writing  prospectus"
                  (as defined in Rule 405 under the U.S.  Securities  Act).  Any
                  such free writing prospectus  consented to by the Underwriters
                  or the Corporation is hereinafter  referred to as a "Permitted
                  Free Writing  Prospectus." The Corporation  agrees that (i) it
                  has treated and will treat, as the case may be, each Permitted
                  Free Writing  Prospectus as an Issuer Free Writing  Prospectus
                  and (ii) it has complied and will comply,  as the case

<PAGE>
                                      -23-

                  may be, with the  requirements  of Rules 164 and 433 under the
                  U.S.  Securities  Act applicable to any Permitted Free Writing
                  Prospectus,  including  in respect of timely  filing  with the
                  SEC, legending and record keeping;

            (bb)  the Corporation and its  subsidiaries  have filed all federal,
                  provincial,  state,  local and foreign  tax  returns  that are
                  required  to be filed  or have  requested  extensions  thereof
                  (except in any case in which the  failure so to file would not
                  have a material  adverse effect on the assets and  properties,
                  business,  results  of  operations,   prospects  or  condition
                  (financial or otherwise) of such  entities,  taken as a whole)
                  and have  paid all taxes  required  to be paid by them and any
                  other assessment,  fine or penalty levied against them, to the
                  extent that any of the  foregoing is due and  payable,  except
                  for any such  assessment,  fine or penalty  that is  currently
                  being contested in good faith;

            (cc)  neither  the  Corporation  nor any of its  subsidiaries  is in
                  default  in the  observance  or  performance  of any  term  or
                  obligation  to be performed  by it under any contract  entered
                  into which is material to the Corporation and its subsidiaries
                  taken as a whole and no event has  occurred  which with notice
                  or  lapse  of  time  or  both  would  directly  or  indirectly
                  constitute  such a default,  in any such case which default or
                  event  would have a material  adverse  effect on the assets or
                  properties,  business,  results of  operations,  prospects  or
                  condition  (financial or otherwise) of the Corporation and its
                  subsidiaries taken as a whole;

            (dd)  the issued and  outstanding  Common Shares of the  Corporation
                  are listed and posted for trading on the Exchanges;

            (ee)  the  Disclosure  Documents  contain  and will  contain  in all
                  material respects the disclosure  required by all requirements
                  of the Securities Legislation;

            (ff)  to  the  knowledge  of  the  Corporation,  no  insider  of the
                  Corporation has a present  intention to sell any securities of
                  the Corporation other than as disclosed to the Underwriters;

            (gg)  other than the  Underwriters  and the  Selling  Dealer  Group,
                  there is no person  acting or purporting to act at the request
                  of the  Corporation who is entitled to any brokerage or agency
                  fee in connection with the sale of the Offered Securities;

            (hh)  the books and records of the Corporation made available to the
                  Underwriters,  or their counsel,  in connection with their due
                  diligence investigations for the periods from their respective
                  dates of incorporation to the date of examination  thereof are
                  the original books and records of the  Corporation and contain
                  copies of all proceedings (or certified copies

<PAGE>
                                      -24-

                  thereof) of the  shareholders,  the board of directors and all
                  committees  of the board of  directors  and there have been no
                  other   meetings,    resolutions   or   proceedings   of   the
                  shareholders, board of directors or any committee of the board
                  of  directors  to the date of review of such records and books
                  not reflected in such books and other records other than those
                  which have been disclosed to the Underwriters;

            (ii)  the Subscription  Receipts will, at the Offering Closing Time,
                  have been duly created and be duly and validly issued as fully
                  paid securities of the Corporation entitled to the benefits of
                  the Subscription Receipt Agreement, the Convertible Debentures
                  will be duly created under the Trust Indenture and, upon their
                  issuance in  accordance  with the terms and  conditions of the
                  Trust Indenture and the  Subscription  Receipt  Agreement,  be
                  duly and  validly  issued  as  fully  paid  securities  of the
                  Corporation  entitled to the benefits of the Trust  Indenture,
                  and the  Common  Shares  issuable  upon  the  exercise  of the
                  conversion rights pursuant to the Convertible Debentures will,
                  upon their issuance in accordance  with the terms of the Trust
                  Indenture,  be duly  and  validly  issued  as  fully  paid and
                  non-assessable securities of the Corporation;

            (jj)  Ernst & Young LLP,  the  auditors of the  Corporation  for the
                  year ended March 30, 2007, are independent  public accountants
                  as required  under  Securities  Legislation  and there has not
                  been any reportable event or disagreement  (within the meaning
                  of  National  Instrument  51-102  of the  Canadian  Securities
                  Administrators) with such auditors;

            (kk)  Deloitte  &  Touche   LLP,   the   current   auditors  of  the
                  Corporation,  are independent  public  accountants as required
                  under  Securities  Legislation  and  there  has not  been  any
                  reportable  event  or  disagreement  (within  the  meaning  of
                  National   Instrument   51-102  of  the  Canadian   Securities
                  Administrators) with such auditors;

            (ll)  the   Corporation   has  no   reason  to   believe   that  the
                  representations  and warranties of Legerity in the Acquisition
                  Agreement  are not true and  correct as of the date  hereof or
                  that  Legerity  is  in  breach  of  any  covenants  under  the
                  Acquisition  Agreement,  except  such  as  would  not  have  a
                  material adverse effect on the business, operations,  capital,
                  properties, assets, prospects, liabilities (absolute, accrued,
                  contingent  or otherwise) or results of operations of Legerity
                  and its subsidiaries taken as a whole;

            (mm)  Merger Sub has duly  authorized,  executed and  delivered  the
                  Acquisition    Agreement   and   the   Acquisition   Agreement
                  constitutes  a legal,  valid and binding  obligation of Merger
                  Sub  enforceable  against  it in  accordance  with its  terms,
                  except  as  the   enforcement   thereof   may  be  limited  by
                  bankruptcy, insolvency, reorganization, fraudulent conveyances
                  or transfer,  moratorium or similar laws affecting  creditors'
                  rights  generally

<PAGE>
                                      -25-

                  and subject to general  principles  of equity  (regardless  of
                  whether enforceability is considered in a proceeding in equity
                  or at law). Merger Sub is an indirect wholly-owned  subsidiary
                  of the Corporation;

            (nn)  the  Corporation  is not  aware of any  existing,  pending  or
                  threatened fact,  event,  circumstances  or regulatory  action
                  that could  reasonably  be  expected  to prevent or impede the
                  completion  of  the   Acquisition   in  accordance   with  the
                  Acquisition Agreement;

            (oo)  to the  knowledge of the  Corporation,  except as disclosed in
                  the Acquisition Agreement:

                  (i)   Legerity has been duly organized and is validly existing
                        under the laws of the  jurisdiction  of its formation or
                        incorporation (as applicable);

                  (ii)  Legerity  has  all  requisite  power  and  authority  to
                        conduct its  business  as  described  in the  Disclosure
                        Documents  and  to  execute,  deliver  and  perform  its
                        obligations under the Acquisition Agreement; and

                  (iii) Navigant Capital Advisors,  LLC and the other holders of
                        the common  stock of Legerity  hold good and  marketable
                        title thereto;

            (pp)  the  Corporation  is eligible to file a short form  prospectus
                  pursuant to NI 44-101;

            (qq)  the   Corporation   has   not   completed   any   "significant
                  acquisition" (as such term is used in item 10 of Form 44-101F1
                  of  National  Instrument  44-101  of the  Canadian  Securities
                  Administrators)  nor is it proposing any acquisition  that has
                  progressed to a state where a reasonable  person would believe
                  that the likelihood of the acquisition being completed is high
                  (other than the Acquisition),  in each case that would require
                  the inclusion of any  additional  financial  statements or pro
                  forma  financial   statements  in  the  Disclosure   Documents
                  pursuant to Securities Legislation;

            (rr)  to the knowledge of the Corporation,  none of the Corporation,
                  its  officers  or  directors  is  aware  of any  circumstances
                  presently   existing   under  which   liability  is  or  could
                  reasonably be expected to be incurred under Part XXIII - Civil
                  Liability for Secondary  Market  Disclosure of the  Securities
                  Act (Ontario); and

            (ss)  all of the  representations  and  warranties  provided  in the
                  Acquisition  Agreement  by the  Corporation  and Merger Sub as
                  qualified in the Acquisition Agreement and the representations
                  and warranties of Legerity in sections  2.7(a) and (c) and 2.8
                  of the  Acquisition  Agreement as

<PAGE>
                                      -26-

                  qualified in the Acquisition Agreement are incorporated herein
                  by  reference  as   representations   and  warranties  of  the
                  Corporation to the Underwriters.

      6.2   The Corporation  covenants and agrees with each of the  Underwriters
            that:

            (a)   the Corporation will advise the  Underwriters,  promptly after
                  receiving  notice  thereof,  of the time when the  Amended and
                  Restated  Preliminary  Prospectus and the Prospectus have been
                  filed and the Amended Preliminary MRRS Decision Document,  the
                  Final MRRS Decision  Document and any other receipts have been
                  obtained  and  will  provide  evidence   satisfactory  to  the
                  Underwriters  of each  filing and the  issuance of the Amended
                  Preliminary MRRS Decision Document and the Final MRRS Decision
                  Document and any other receipts;

            (b)   the Corporation will advise the  Underwriters,  promptly after
                  receiving notice or obtaining  knowledge,  of (i) the issuance
                  by  any  Securities   Commission  or  the  SEC  of  any  order
                  suspending or preventing the use of the Disclosure  Documents,
                  (ii)  the  suspension  of the  qualification  of  the  Offered
                  Securities  for  offering  or  sale  in any of the  Qualifying
                  Provinces  and  the  United  States,  (iii)  the  institution,
                  threatening  or  contemplation  of any  proceeding  for any of
                  those  purposes,  or (iv) any requests made by any  Securities
                  Commission or the SEC to amend or  supplement  the Amended and
                  Restated Preliminary  Prospectus the U.S. Amended and Restated
                  Preliminary Prospectus,  the Prospectus or the U.S. Prospectus
                  or for additional  information,  and will use its commercially
                  reasonable  efforts to prevent the  issuance of any such order
                  and, if any such order is issued,  to obtain the withdrawal of
                  the order promptly; and

            (c)   upon  release  of the  Escrowed  Funds to the  Corporation  on
                  closing of the Acquisition, the Corporation will apply the net
                  proceeds from the Offering  substantially  in accordance  with
                  the disclosure in the  Disclosure  Documents set out under the
                  heading "Use of Proceeds".

7.    Closing

      7.1   Closing  shall occur at the  Offering  Closing  Time on the Offering
            Closing  Date at the offices of McCarthy  Tetrault  LLP,  1000 de la
            Gauchetiere  St. W., Suite 2500,  Montreal,  Quebec or at such other
            place  as the  Corporation  and the  Underwriters  may  agree  to in
            writing.  At the Offering Closing Time, the Lead  Underwriter  shall
            deliver  by wire  transfer  or  otherwise  to the  Escrow  Agent the
            purchase price for the Offered  Securities  being issued and sold to
            the Underwriters  under this Agreement net of the  Underwriters' fee
            payable by the Corporation to the Underwriters as provided in (b) of
            this  paragraph  and the  amount of the  Underwriters'  expenses  as
            provided in paragraph 12 against  delivery by the Corporation to the
            Lead Underwriter, on behalf of the Underwriters, of:

<PAGE>
                                      -27-

            (a)   a global certificate or certificates  representing the Offered
                  Securities  to be  purchased  by  the  Underwriters  hereunder
                  registered  in the  name of the CDS  Clearing  and  Depository
                  Services Inc., or its nominee;

            (b)   a  direction  to the Lead  Underwriter  to deduct  1.5% of the
                  gross proceeds from the sale of the Offered  Securities and to
                  pay such amount to the  Underwriters as one-half their fee for
                  the services  provided  under this  Agreement;  with the other
                  1.5%  being  payable  immediately  upon  the  closing  of  the
                  Acquisition; and

            (c)   such further documentation as may be contemplated herein.

      7.2   Each  closing  of the  Offered  Securities  to be  issued  under the
            Over-Allotment  Option,  if  applicable,  will be  completed  at the
            offices of McCarthy  Tetrault  LLP, 1000 de la  Gauchetiere  St. W.,
            Suite  2500,  Montreal,  Quebec,  or at any  other  place  agreed in
            writing  by the  Corporation  and the  Underwriters  on the date (an
            "Additional  Offering Closing Date") and at the time (an "Additional
            Closing  Time")  specified  by the  Underwriters  in  Over-Allotment
            Notice or at such  other time and date as the  Underwriters  and the
            Corporation  may agree  upon in writing  (provided  that in no event
            shall such time be earlier than two or later than ten Business  Days
            after   the  date  the   Over-Allotment   Notice  is  given  by  the
            Underwriters to the Corporation). At the Additional Offering Closing
            Time the Lead Underwriter  shall deliver to the Escrow Agent by wire
            transfer or otherwise the purchase price for the additional  Offered
            Securities being issued and sold to the Underwriters pursuant to the
            Over-Allotment  Option  net  of  the  additional  Underwriters'  fee
            payable by the Corporation to the Underwriters as provided in (b) of
            this  paragraph  and  the  additional  amount  of the  Underwriters'
            expenses  as  provided  in  paragraph  12  against  delivery  by the
            Corporation to the Lead Underwriter,  on behalf of the Underwriters,
            of:

            (a)   a global certificate or certificates  representing the Offered
                  Securities  to be  purchased  by  the  Underwriters  hereunder
                  registered  in the  name of the CDS  Clearing  and  Depository
                  Services Inc., or its nominee;

            (b)   a  direction  to the Lead  Underwriter  to deduct  1.5% of the
                  additional  gross  proceeds  from the  sale of the  additional
                  Offered  Securities and to pay such amount to the Underwriters
                  as one-half  their fee for the  services  provided  under this
                  Agreement;  with the other 1.5% being payable immediately upon
                  the closing of the Acquisition; and

            (c)   such further documentation as may be contemplated herein.

8.    Closing Conditions

      8.1   The Underwriters'  obligation to purchase the Offered  Securities at
            the Offering  Closing Time or the  Additional  Closing  Time, as the
            case may be,  shall be subject

<PAGE>
                                      -28-

            to the  following  conditions,  which  conditions  are for the  sole
            benefit of the Underwriters and may be waived in writing in whole or
            in part by the Underwriters in their discretion:

            (a)   prior to the Offering  Closing Time or the Additional  Closing
                  Time,  as the case may be,  the  Corporation  shall  have made
                  and/or obtained the necessary filings, approvals, consents and
                  acceptances required to be made or obtained by the Corporation
                  under  Securities  Legislation  (including  the receipt of all
                  approvals from the Exchanges) in connection  with the offering
                  of the Offered Securities on terms which are acceptable to the
                  Corporation and the Underwriters, acting reasonably;

            (b)   all  authorizations  and approvals shall have been obtained by
                  the Corporation for the execution, delivery and performance by
                  it of this Agreement and for the issuance of the  Subscription
                  Receipts, the Convertible Debentures and the Common Shares;

            (c)   all  authorizations  and approvals shall have been obtained by
                  the Corporation for the execution, delivery and performance by
                  the Corporation of the Subscription  Receipt Agreement and the
                  Trust Indenture;

            (d)   the Subscription  Receipts, the Convertible Debentures and the
                  Common  Shares  shall  have  been  approved  or  conditionally
                  approved for listing on the TSX,  and the Common  Shares shall
                  have been  approved or  conditionally  approved for listing on
                  the NYSE,  at the opening of trading on the  Offering  Closing
                  Date, subject to fulfillment of customary conditions;

            (e)   the  Corporation  shall  deliver to the  Underwriters,  at the
                  Offering Closing Time or the Additional Offering Closing Time,
                  as applicable,  a certificate  dated the Offering Closing Date
                  or  the  Additional  Offering  Closing  Time,  as  applicable,
                  addressed  to  the  Underwriters  and  signed  by  two  senior
                  officers of the Corporation,  acceptable to the  Underwriters,
                  acting  reasonably,  certifying  for  and  on  behalf  of  the
                  Corporation to the effect that:

                  (i)   the  Corporation  has complied in all material  respects
                        with all the material  covenants  and  satisfied all the
                        material  terms and  conditions of this  Agreement,  the
                        Subscription  Receipt  Agreement and the Trust Indenture
                        on its  part to be  complied  with and  satisfied  at or
                        prior to the  Offering  Closing  Time or the  Additional
                        Offering Closing Time, as applicable;

                  (ii)  the  representations  and warranties of the  Corporation
                        contained  herein are true and  correct in all  material
                        respects  as  at  the  Offering

<PAGE>
                                      -29-

                        Closing Time or the Additional Offering Closing Time, as
                        applicable, with the same force and effect as if made on
                        and as at the Offering  Closing  Time or the  Additional
                        Offering Closing Time, as applicable;

                  (iii) no order,  ruling or determination  having the effect of
                        ceasing   the   trading  of  the  Common   Shares,   the
                        Convertible  Debentures or the Subscription Receipts, or
                        suspending  the  sale of the  Subscription  Receipts  or
                        Convertible Debentures or preventing the issuance of the
                        Common Shares,  has been issued and no  proceedings  for
                        such purpose have been  instituted or are pending or, to
                        the knowledge of such senior  officer,  contemplated  or
                        threatened;

                  (iv)  the  representations  and warranties of the  Corporation
                        arising  by reason  of the  delivery  of the  Disclosure
                        Documents  and  the  effectiveness  of the  Registration
                        Statement are true and correct in all material  respects
                        on and as at the Offering Closing Time or the Additional
                        Offering   Closing   Date,  as  applicable  as  if  such
                        documents  had been dated the  Offering  Closing Date or
                        the Additional  Offering Closing Time, as applicable and
                        delivered to the Underwriters;

                  (v)   since the  respective  dates as of which  information is
                        given in the Preliminary  Prospectus,  the  Registration
                        Statement, the U.S. Preliminary Prospectus,  the Amended
                        and Restated  Preliminary  Prospectus,  the U.S. Amended
                        and Restated  Preliminary  Prospectus and any Prospectus
                        Amendment:

                        A.    there  has  been  no  material   change   (actual,
                              anticipated,  contemplated or threatened,  whether
                              financial or otherwise) in the business,  affairs,
                              operations,    assets,   prospects,    liabilities
                              (contingent or otherwise),  capital,  ownership or
                              control of the  Corporation  or its  subsidiaries;
                              and

                        B.    no  transaction  out of  the  ordinary  course  of
                              business  has been  entered  into or is pending by
                              the Corporation or its subsidiaries,

                        which   is   material   to  the   Corporation   and  its
                        subsidiaries   taken   as  a  whole,   other   than  the
                        Acquisition or as disclosed in the Disclosure Documents,
                        and all such  matters  shall in fact be true and correct
                        in all material respects as at the Offering Closing Time
                        or the Additional Offering Closing Time, as applicable;

            (f)   except for the  completion  of the  Acquisition,  all  actions
                  required to be taken by the Corporation, including the passing
                  of all requisite  resolutions

<PAGE>
                                      -30-

                  and all requisite filings with governmental authorities, shall
                  have occurred at or prior to the Offering  Closing Time or the
                  Additional  Offering Closing Time, as applicable so as validly
                  to authorize the execution and delivery of this Agreement, the
                  Subscription Receipt Agreement and the Trust Indenture and the
                  performance of the transactions contemplated hereby;

            (g)   the  Corporation  will have delivered to the  Underwriters  an
                  executed copy of the  Subscription  Receipt  Agreement and the
                  Trust  Indenture,  each in form and substance  satisfactory to
                  the Underwriters and their counsel, acting reasonably;

            (h)   the Corporation will have caused  favourable legal opinions to
                  be delivered by its Canadian and U.S. counsel addressed to the
                  Underwriters  and  their  counsel  in  a  form  and  substance
                  satisfactory  to the  Underwriters  and their counsel,  acting
                  reasonably,  with respect to such matters as the  Underwriters
                  and their  counsel  may  reasonably  request  relating  to the
                  distribution  of  the  Offered  Securities.   In  giving  such
                  opinions,  counsel to the  Corporation  shall be  entitled  to
                  rely, to the extent  appropriate  in the  circumstances,  upon
                  opinions of local counsel  acceptable to the  Underwriters and
                  their  counsel,  acting  reasonably,  and shall be entitled to
                  rely to the extent  appropriate in the circumstances as to the
                  matters of fact upon a certificate  of a senior officer of the
                  Corporation;

            (i)   the  Corporation  shall  deliver to the  Underwriters,  at the
                  Offering Closing Time or the Additional Offering Closing Time,
                  as  applicable,  a  separate  certificate  dated the  Offering
                  Closing  Date or the  Additional  Offering  Closing  Time,  as
                  applicable  addressed  to the  Underwriters  and  signed  by a
                  senior   officer  of  the   Corporation,   acceptable  to  the
                  Underwriters,  acting reasonably, certifying for and on behalf
                  of the Corporation its constating  documents,  all resolutions
                  of the board of  directors,  as  applicable,  relating  to the
                  transactions  contemplated  hereunder and the  incumbency  and
                  specimen signatures of signing officers;

            (j)   the Underwriters shall have received evidence  satisfactory to
                  the  Underwriters,  acting  reasonably,  that the  Acquisition
                  Agreement  has been  executed  and  delivered  by the  parties
                  thereto and that such  agreement has not been  terminated  and
                  that,  to the  knowledge  of the  Corporation,  no  event  has
                  occurred or condition exists that will prevent the Acquisition
                  from  being  completed  prior to 5:00 p.m.  (Toronto  time) on
                  August 24, 2007  substantially and in all material respects as
                  contemplated in the Acquisition Agreement;

            (k)   the Underwriters  will have received such other  certificates,
                  opinions,  agreements,  materials  or  documents  in form  and
                  substance   satisfactory   to   the   Underwriters,   as   the
                  Underwriters may reasonably request; and

<PAGE>
                                      -31-

            (l)   the Corporation  having complied with all covenants  contained
                  herein in all material  respects and  satisfied  all terms and
                  conditions  contained  herein in all  material  respects to be
                  complied  with and satisfied by it at or prior to the Offering
                  Closing  Time or the  Additional  Offering  Closing  Time,  as
                  applicable.

9.    Termination

      9.1   Without limiting any of the foregoing  provisions and in addition to
            any other remedies which may be available,  the Underwriters (or any
            of them) shall be entitled,  at their option, to terminate,  without
            any liability on their part,  their (or its)  obligation to purchase
            the Offered Securities by written notice to that effect given to the
            Corporation  and the Lead  Underwriter  at or prior to the  Offering
            Closing  Time  (or,  in  the  event  the  Over-Allotment  Option  is
            exercised, the Additional Offering Closing Time), if:

            (a)   any inquiry,  action, suit,  investigation or other proceeding
                  is  commenced  or any order is issued under or pursuant to any
                  law in Canada or the United States (except any such proceeding
                  or   order   based   solely   upon  the   activities   of  the
                  Underwriters),   or  there  is  any   change  of  law  or  the
                  interpretation  or administration  thereof,  which operates to
                  prevent or restrict the trading in or which adversely  impacts
                  the  distribution  of the  Offered  Securities  or the  Common
                  Shares  in any  of  the  Qualifying  Provinces  or the  United
                  States;

            (b)   after the date hereof and prior to the  Offering  Closing Time
                  or the Additional Offering Closing Time, as applicable,  there
                  shall occur any material  change or change in a material  fact
                  which, in the reasonable  opinion of the  Underwriters (or any
                  one  of  them),   would  reasonably  be  expected  to  have  a
                  significant adverse effect on the market price or value of the
                  Offered Securities or the Common Shares;

            (c)   there should  develop,  occur or come into effect or existence
                  any  event,  action,  state,   condition  or  major  financial
                  occurrence  of national or  international  consequence  or any
                  law,  regulation or other occurrence of any nature  whatsoever
                  which, in the reasonable  opinion of the  Underwriters (or any
                  one of them),  materially  adversely affects, or involves,  or
                  will  materially  adversely  affect or  involve,  the state of
                  North American  financial or capital  markets or the business,
                  operations or affairs of the Corporation and their  respective
                  subsidiaries taken as a whole; or

            (d)   the  Corporation  shall  be in  breach  of,  default  under or
                  non-compliance  with any  material  representation,  warranty,
                  covenant, term or condition of this Agreement.

<PAGE>
                                      -32-

      9.2   All terms and  conditions  of this  Agreement  shall be construed as
            conditions, and any material breach or failure by the Corporation to
            comply  with any of such  terms and  conditions  shall  entitle  the
            Underwriters,  or any of them,  to terminate  their  obligations  to
            purchase  the Offered  Securities  by notice to that effect given to
            the  Corporation  at or prior to the  Offering  Closing  Time or the
            Additional  Offering  Closing Time, as applicable.  The Underwriters
            may waive,  in whole or in part,  or extend the time for  compliance
            with,  any of such terms and conditions  without  prejudice to their
            rights in respect of any other of such terms and  conditions  or any
            other or subsequent  breach or  non-compliance;  provided,  however,
            that to be binding on the  Underwriters any such waiver or extension
            must be in writing and signed by all of the Underwriters.

      9.3   The  rights of  termination  contained  in this  paragraph  9 may be
            exercised  by any of the  Underwriters  and are in  addition  to any
            other rights or remedies the Underwriters or any of them may have in
            respect of any default,  act or failure to act or  non-compliance by
            the  Corporation  in respect of any of the matters  contemplated  by
            this Agreement.

      9.4   In the  event of any such  termination,  there  shall be no  further
            liability on the part of the  Underwriters  to the Corporation or on
            the part of the Corporation to such Underwriters,  except in respect
            of any liability which may have arisen or may thereafter arise under
            paragraphs  10,  11 and 12.  A  notice  of  termination  given by an
            Underwriter  under this  paragraph  9 shall not be binding  upon any
            other Underwriter who has not also executed such notice.

10.   Indemnity

      10.1  The  Corporation  covenants and agrees to protect and indemnify each
            of  the  Underwriters  and  their  respective  directors,  officers,
            employees, partners and agents (each an "Indemnified Party") against
            all losses  (other  than a loss of profits  in  connection  with the
            distribution   of  the   Offered   Securities),   claims,   damages,
            liabilities, costs or expenses caused or incurred by reason of:

            (a)   any  statement  or  information  contained  in the  Disclosure
                  Documents  or any  document or  material  that may be filed on
                  behalf of the Corporation under Securities  Legislation or any
                  other document or material filed or delivered  pursuant hereto
                  (other than any statement or  information  relating  solely to
                  Underwriters)   containing  or  being  alleged  to  contain  a
                  misrepresentation  or  being or being  alleged  to be  untrue,
                  false or misleading;

            (b)   the  omission or alleged  omission to state in the  Disclosure
                  Documents or any other document or material filed or delivered
                  pursuant  hereto any material fact (other than a material fact
                  relating  solely  to  the  Underwriters  and  provided  by the
                  Underwriters  for inclusion in such  document)  required to be
                  stated therein or necessary to make any statement  therein

<PAGE>
                                      -33-

                  not  false or  misleading  in the  light of the  circumstances
                  under which it was made;

            (c)   any statement  (other than a statement  relating solely to the
                  Underwriters) contained in the Public Record which at the time
                  and in the light of the circumstances under which it was made,
                  contained or is alleged to have contained a  misrepresentation
                  or being alleged to be untrue, false or misleading;

            (d)   any order made or inquiry, investigation or proceeding (formal
                  or  informal)  commenced  or  threatened  by  any  officer  or
                  official  of  any  securities  regulatory   authority.   stock
                  exchange or by any other  competent  authority  based upon the
                  circumstances  described in clauses 10.1(a), (b) and (c) above
                  which  operates to prevent or restrict  trading in or the sale
                  or distribution of the Offered Securities or the Common Shares
                  in any of the Qualifying Provinces or in the United States;

            (e)   the breach of any representations,  warranties or covenants by
                  the Corporation contained in this Agreement,  the Subscription
                  Receipt  Agreement,  the  Trust  Indenture  or  any  documents
                  delivered pursuant hereto; or

            (f)   the   Corporation   not  complying  with  any  requirement  of
                  Securities  Legislation  in connection  with the  transactions
                  contemplated  by  this  Agreement,  the  Subscription  Receipt
                  Agreement and the Trust Indenture.

      10.2  If any matter or thing  contemplated  by this  paragraph 10 shall be
            asserted   against  any  Indemnified   Party  in  respect  of  which
            indemnification is or might reasonably be considered to be provided,
            such  Indemnified  Party  shall  notify the  Corporation  as soon as
            possible of the nature of such claim  (provided  that any failure so
            to notify shall  relieve the  Corporation  of  liability  under this
            paragraph  10 only to the extent that such  failure  prejudices  the
            ability to defend such claim) and the Corporation  shall be entitled
            (but  not  required)  to  assume  the  defence,  on  behalf  of  the
            Indemnified  Party,  of any suit  brought  to  enforce  such  claim;
            provided,  however,  that the defence shall be through legal counsel
            acceptable to the Indemnified Party, acting reasonably,  and that no
            settlement or admission of liability may be made by the  Corporation
            without the prior written consent of the other unless the settlement
            is made by the Corporation and such settlement includes a release of
            each  indemnified  party  from any  liabilities  arising  under such
            claim.

      10.3  With respect to any such claim, the Indemnified Party shall have the
            right to retain  separate  counsel to act on his, her or its behalf,
            provided the fees and  disbursements  of such separate counsel shall
            be paid by the Indemnified Party, unless any of the following apply,
            in  which  case  such  fees  and  disbursements  will be paid by the
            Corporation:

<PAGE>
                                      -34-

            (a)   the  Corporation  fails to assume the defence of such claim on
                  behalf of the  Indemnified  Party within ten days of receiving
                  notice of such claim;

            (b)   the Corporation and the Indemnified  Party shall have mutually
                  agreed to the retention of such counsel; or

            (c)   the named parties to any claim (including any added,  third or
                  impleaded  parties)  include  either  the  Corporation  or the
                  Indemnified  Party, and the Indemnified Party has been advised
                  by his, her or its counsel that  representation of all parties
                  by the same counsel  would be  inappropriate  due to actual or
                  potential differing interests between any of them;

            Notwithstanding  the  foregoing,  no settlement or compromise of any
            claim or potential claim may be made by an Indemnified Party without
            the prior written consent of the Corporation, which consent will not
            be unreasonably withheld.

      10.4  The rights of indemnity  contained in this  paragraph 10 shall:  (a)
            not enure to the benefit of the Underwriter or any other Indemnified
            Party if the  provisions  of paragraph 6 have been complied with and
            the person asserting any claim contemplated by this paragraph 10 was
            not provided with a copy of any  Disclosure  Document which corrects
            any untrue statement or information,  misrepresentation  or omission
            which is the  basis of such  claim  and  which  is  required,  under
            Securities  Legislation,  to be  delivered  to  such  person  by the
            Underwriters or members of the Selling Dealer Group (if any); or (b)
            cease  to be  available  to an  Indemnified  Party  if the  claim is
            determined  by  a  court  of  competent  jurisdiction  (in  a  final
            judgement)  to have been caused by any fraud,  wilful  misconduct or
            gross  negligence by the  Indemnified  Party.  In the event that the
            rights of  indemnity  in this  paragraph  10 shall have ceased to be
            available to an Indemnified  Party pursuant to the preceding  clause
            (b), the Indemnified Party shall promptly  reimburse the Corporation
            for any funds  advanced to the  Indemnified  Party  pursuant to this
            indemnity in respect of such claim.

      10.5  The Corporation  acknowledges  and agrees that the  Underwriters are
            contracting  on their own behalf and as agents for their  respective
            directors,  officers,  employees and agents and  accordingly  hereby
            constitute the  Underwriters  as trustees for any other  Indemnified
            Party  for  the  covenants  of the  Corporation  contained  in  this
            paragraph  10 with  respect  to  such  Indemnified  Parties  and the
            Underwriters  agree to accept such trust and to hold such  covenants
            on behalf of such persons.

      10.6  The  Corporation  hereby  waives  any  right  it may  have of  first
            requiring an Indemnified Party to proceed against, enforce any other
            right,  power,  remedy or security or claim payment from,  any other
            person before claiming against it under this paragraph 10.

<PAGE>
                                      -35-

      10.7  If the  Corporation  has assumed the defence of any suit  brought to
            enforce a claim  hereunder  at the expense of the  Corporation,  the
            Indemnified  Party  shall  provide  the  Corporation  copies  of all
            documents and information in its possession pertaining to the claim,
            take all reasonable  actions required by the Corporation to preserve
            the right to object to or defend  against  the  claim,  consult  and
            reasonably cooperate with the Corporation in determining whether the
            claim  and  any  legal  proceeding  resulting  therefrom  should  be
            resisted, compromised or settled and reasonably cooperate and assist
            in any  negotiations  to compromise or settle,  in any defense of, a
            claim undertaken by the Corporation.

11.   Contribution

      11.1  If for any reason the  indemnification  provided for in paragraph 10
            is  unavailable,  in whole or in part,  to an  Indemnified  Party in
            respect  of any  losses,  claims,  damages,  liabilities,  costs  or
            expenses  (or  claims,  actions,  suits or  proceedings  in  respect
            thereof)   referred  to  in   paragraph   10,  and  subject  to  the
            restrictions  and limitations  referred to therein,  the Corporation
            shall  contribute  to the  amount  paid  or  payable  (or,  if  such
            indemnity is unavailable  only in respect of a portion of the amount
            so paid or payable,  such  portion of the amount so paid or payable)
            by such  Indemnified  Party  as a  result  of such  losses,  claims,
            damages,  liabilities,  costs or expenses (or claims, actions, suits
            or  proceedings  in  respect  thereof)  in  such  proportion  as  is
            appropriate  to reflect not only the relative  benefits  received by
            the  Corporation,  on the one  hand,  and the  Underwriters,  on the
            other,  but also the relative fault of the  Corporation,  on the one
            hand, and the  Underwriters,  on the other hand, in connection  with
            the  statement,  information,  misrepresentation,  omission,  order,
            inquiry, investigation, proceeding or other matter or thing referred
            to in paragraph 10 which resulted in such losses,  claims,  damages,
            liabilities,  costs  or  expenses  (or  claims,  actions,  suits  or
            proceedings  in  respect  thereof),  as well as any  other  relevant
            equitable  considerations;  provided that the Underwriters shall not
            in any event be liable to contribute,  in the aggregate,  any amount
            in  excess  of the fee  actually  received  by the  Underwriters  as
            provided in this Agreement.

      11.2  The relative benefits received on behalf of the Corporation,  on the
            one hand, and the  Underwriters,  on the other hand, shall be deemed
            to be in  the  same  proportion  as  the  total  proceeds  from  the
            distribution of the Subscription Receipts (net of the fee payable to
            the Underwriters but before deducting  expenses)  received on behalf
            of the Corporation is to the fee received by the  Underwriters.  The
            relative  fault  of  the  Corporation,  on the  one  hand,  and  the
            Underwriters,  on the other hand,  shall be  determined by reference
            to, among other things,  whether the  statement,  misrepresentation,
            omission, order, inquiry, investigation,  proceeding or other matter
            or thing  referred to in paragraph 10 which resulted in such losses,
            claims, damages, liabilities, costs or expenses (or claims, actions,
            suits or  proceedings  in respect  thereof),  relates to information
            supplied by or steps or actions taken or done by or on behalf of the
            Underwriters   and  the  relative  intent,   knowledge,

<PAGE>
                                      -36-

            access to  information  and  opportunity  to correct or prevent such
            statement,    misrepresentation,     omission,    order,    inquiry,
            investigation,  proceeding  or other matter or thing  referred to in
            paragraph 10. The amount paid or payable by an Indemnified  Party as
            a result of such  losses,  claims,  damages,  liabilities,  costs or
            expenses  (or  claims,  actions,  suits or  proceedings  in  respect
            thereof),  referred to above shall be deemed to include any legal or
            other  expenses  reasonably  incurred by such  Indemnified  Party in
            connection with investigating or defending any such losses,  claims,
            damages,  liabilities,  costs or expenses (or claims, actions, suits
            or proceedings in respect thereof),  whether or not resulting in any
            such action, suit, proceeding or claim.

12.   Expenses

Whether or not the  transactions  herein  contemplated  shall be completed,  all
expenses of or incidental to the authorization,  creation, issue and sale of the
Offered  Securities  and all expenses of or  incidental  to all other matters in
connection with the Offering including,  without limitation:  listing and filing
fees,  costs of the  Escrow  Agent  appointed  under  the  Subscription  Receipt
Agreement,  costs of the  Convertible  Debenture  Trustee,  expenses  payable in
connection with the  qualification of the Offered  Securities for  distribution,
the fees and expenses of counsel for the  Corporation  and  reasonable  fees and
expenses  of  counsel  for the  Underwriters,  all  fees and  expenses  of local
counsel, all fees and expenses of the auditors to the Corporation, and all costs
incurred in  connection  with  preparing,  printing,  translating  and providing
copies  of  the  Disclosure   Documents  and   certificates   representing   the
Subscription  Receipts and  Convertible  Debentures and all fees and expenses of
transfer agent and any  reasonable  out-of-pocket  expenses of the  Underwriters
shall be borne by and for the account of the Corporation.

13.   Obligation of Underwriters to Purchase

The  obligation of the  Underwriters  to purchase the Offered  Securities at the
Offering  Closing  Time  and  at  the  Additional   Offering  Closing  Time,  if
applicable,  shall be several,  not joint, and shall be limited to the following
percentages  of the aggregated  number of Offered  Securities to be purchased at
that time:

       CIBC World Markets Inc.                                   40%
       National Bank Financial Inc.                              20%
       RBC Dominion Securities Inc.                              20%
       Scotia Capital Inc.                                       20%
                                                                ---
                                                                100%
                                                                ===

If any  one or  more of the  Underwriters  shall  not  purchase  its  applicable
percentage of the Offered  Securities at the Offering  Closing Time,  and at the
Additional  Offering  Closing  Time,  if  applicable,  the others shall have the
right,  but shall not be  obligated,  to purchase all of the  percentage  of the
Offered Securities which would otherwise have been purchased by such one or more
of the Underwriters;  the Underwriters exercising such right shall purchase such
Offered Securities pro rata to their respective percentages aforesaid or in such
other  proportions as they may otherwise  agree.  In the event such right is not
exercised,  the  Underwriters  which are not in

<PAGE>
                                      -37-

default shall be entitled by written notice to the Corporation to terminate this
Agreement without liability.  If none of the other  Underwriters  exercises such
right, the Corporation shall be entitled to terminate its obligations under this
Agreement  (except for its liabilities  under paragraphs 10, 11 and 12) and such
other  Underwriters  shall  be  relieved  of all  of  their  obligations  to the
Corporation  hereunder.  An  Underwriter  which  stands  ready to  purchase  its
percentage as stipulated above of the aggregate number of Offered  Securities to
be purchased by the Underwriters  under this Agreement will have no liability to
the  Corporation if another  Underwriter  defaults in its obligation to purchase
its  percentage  of such Offered  Securities.  Nothing in this  paragraph  shall
oblige  the  Corporation  to sell less  than all of the  Offered  Securities  or
prejudice  or  limit  any  rights  which  the  Corporation  may have  against  a
defaulting  Underwriter or the rights any Underwriter may have against any other
Underwriter.

14.   Market Stabilization

In connection with the distribution of the Offered Securities,  the Underwriters
and  members  of their  selling  group (if any) may  effect  transactions  which
stabilize or maintain the market price of the Offered Securities at levels above
those which might  otherwise  prevail in the open  market,  in  compliance  with
Securities Laws. Those stabilizing transactions,  if any, may be discontinued at
any time.

15.   Restrictions on Further Issues or Sales

During the period  commencing  the date of this  Agreement and ending on the day
which is 90 days following the Acquisition  Closing Date, the  Corporation  will
not,  directly  or  indirectly,  without the prior  written  consent of the Lead
Underwriter (which consent will not be unreasonably  withheld),  issue, agree to
issue,  offer, sell,  contract to sell, grant any option to purchase,  transfer,
assign or  otherwise  dispose of any  securities  or announce  any  intention to
effect the foregoing, other than the Offered Securities (except for the issuance
of the  Convertible  Debentures upon exchange of the  Subscription  Receipts and
Common Shares pursuant to the terms of the Convertible Debentures).

16.   Severability

If any provision of this Agreement is determined to be void or  unenforceable in
whole or in part, it shall be deemed not to affect or impair the validity of any
other provision of this Agreement and such void or unenforceable provision shall
be severable from this Agreement.

17.   Survival

All representations,  warranties,  covenants,  indemnities and agreements of the
Corporation  herein  contained or contained in documents  submitted  pursuant to
this Agreement and in connection with the transactions contemplated herein shall
survive the purchase and sale of the Offered  Securities  and shall  continue in
full force and effect for the  benefit of the  Underwriters,  regardless  of any
subsequent  disposition of the Offered  Securities or any investigation by or on
behalf of the Underwriters with respect thereto.

<PAGE>
                                      -38-

18.   Time of the Essence

Time shall be of the essence of this Agreement.

19.   Governing Law

This  agreement  shall be governed and construed in accordance  with the laws of
the Province of Ontario and the laws of Canada  applicable  therein and shall be
treated in all respects as an Ontario  contract.  Each party hereby  irrevocably
submits to the non-exclusive  jurisdiction of the courts of Ontario with respect
to any matter arising hereunder or related hereto.

20.   Currency

All funds referred to in this Agreement shall be in Canadian dollars.

21.   Notice

Unless  otherwise  expressly  provided  in this  Agreement,  any notice or other
communication  to be given under this Agreement (a "Notice") shall be in writing
addressed as follows:

      (a)   if to the Corporation:

            400 March Road
            Ottawa, ON
            K2K 3J4

            Attention:        President and Chief Executive Officer
            Facsimile:        (613) 270-7403

            with a copy to:

            McCarthy Tetrault LLP
            Suite 2500
            1000 De La Gauchetiere Street West
            Montreal, QC
            H3B 0A2

            Attention:        Sonia Struthers
            Facsimile:        (514) 875-6246

<PAGE>
                                      -39-

      (b)   if to the Underwriters:

            CIBC World Markets Inc.
            BCE Place
            161 Bay Street
            Toronto, Ontario
            M5J 2S8

            Attention:        Marwan Kubursi
            Facsimile:        (416) 594-7226

            with a copy to:

            Blake, Cassels & Graydon
            Suite 2800, Commerce Court West
            199 Bay Street
            Toronto, Ontario
            M5L 1A9

            Attention:        Frank P. Arnone
            Facsimile:        (416) 863-2653

or to such other  address as any of the parties may designate by notice given to
the others.

Each notice shall be personally delivered to the addressee or sent by fax to the
addressee and (i) a notice which is personally  delivered shall, if delivered on
a Business Day, be deemed to be given and received on that day and, in any other
case, be deemed to be given and received on the first Business Day following the
day on which it is delivered;  and (ii) a notice which is sent by fax shall,  if
sent on a Business  Day and the machine on which it is sent  receives the answer
back code from the party to whom it is sent before 5:00 p.m.  (Toronto time), be
deemed to be given and received on that day and, in any other case, be deemed to
be given and received on the first Business Day following the day on which it is
sent.

22.   Authority of Lead Underwriter

The Lead Underwriter is hereby  authorized by each of the other  Underwriters to
act on its behalf in connection  with any matter  arising  hereunder or pursuant
hereto  and the  Corporation  shall be  entitled  to and shall act on any notice
given hereunder or agreement entered into by or on behalf of the Underwriters by
the Lead Underwriter  except in respect of any consent to a settlement  pursuant
to paragraph  10.1 which  consent  shall be given by the  Indemnified  Party,  a
notice of termination pursuant to paragraph 9.1 which notice may be given by any
of the  Underwriters,  or any waiver pursuant to paragraph 9.2 which waiver must
be signed by all of the  Underwriters.  The Lead Underwriter shall consult fully
with the other Underwriters concerning any matter in respect of which it acts on
its behalf hereunder.

<PAGE>
                                      -40-

All  steps  which  may be taken by the  Underwriters  in  connection  with  this
Agreement, may be taken by the Lead Underwriter, on its own behalf and on behalf
of the Underwriters.  The Lead Underwriter,  shall consult with the Underwriters
as necessary prior to taking any action on their behalf and shall, in any event,
advise the Underwriters of steps taken on their behalf.

The  obligations of the  Underwriters  under this Agreement shall be several and
not joint and several.

23.   Counterparts

This  Agreement  may be  executed  by any  one or more  of the  parties  to this
Agreement in any number of counterparts,  each of which shall be deemed to be an
original,  but all such counterparts shall together  constitute one and the same
instrument.

24.   Successors and Assigns

This agreement shall enure to the benefit of and be binding upon the parties and
their respective  successors  (including any successor by reason of amalgamation
or statutory  arrangement) and permitted assigns and upon the heirs,  executors,
legal  representatives,  successors and permitted  assigns of those for whom the
Underwriters are contracting pursuant to paragraph 10. No party shall assign any
of its rights or obligations  hereunder without the consent of the other parties
hereto.

25.   Entire Agreement

The terms,  conditions  and  provisions  of this  Agreement  amend,  restate and
supercede  in  their  entirety  the  terms,  conditions  and  provisions  of the
underwriting agreement between the parties hereto dated July 17, 2007 in respect
of the proposed offering of 55,000 Subscription Receipts.

<PAGE>
                                      -41-

If the foregoing is in accordance with the  Corporation's  understanding  and is
agreed to by the  Corporation,  please signify the your  acceptance by executing
the enclosed  copies of this letter where indicated below and returning the same
to CIBC  World  Markets  Inc.  upon  which  this  letter  as so  accepted  shall
constitute an Agreement among us.

                                              Yours very truly,

                                              CIBC WORLD MARKETS INC.

                                              By: "Marwan Kubursi"
                                                  ------------------------------
                                              Name: Marwan Kubursi
                                              Title: Executive Director

                                              NATIONAL BANK FINANCIAL INC.

                                              By: "Amit Monga"
                                                  ------------------------------
                                              Name: Amit Monga
                                              Title: Vice President

                                              RBC DOMINION SECURITIES INC.

                                              By: "Scott Davis"
                                                  ------------------------------
                                              Name: Scott Davis
                                              Title: Director

                                              SCOTIA CAPITAL INC.

                                              By: "Scott Dorsey"
                                                  ------------------------------
                                              Name: Scott Dorsey
                                              Title: Managing Director

<PAGE>
                                      -42-

      The foregoing  accurately  reflects the terms of the transaction  which we
are to enter into and such terms are agreed to with  effect as of the date first
above written.

                                              ZARLINK SEMICONDUCTOR INC.

                                              By: "Scott Milligan"
                                                  ------------------------------
                                              Name: Scott Milligan
                                              Title: Senior Vice-President,
                                                     Finance and Chief Financial
                                                     Officer

                                              By: "Donald G. McIntyre"
                                                  ------------------------------
                                              Name: Donald G. McIntyre
                                              Title: Senior Vice-President,
                                              Human Resources, General Counsel
                                              and Corporate Secretary

<PAGE>

                                                                   July 20, 2007

Zarlink Semiconductor Inc.
400 March Rd.
Ottawa, ON
K2K 3HA

Re:   Revision to the Engagement Letter and Underwriting Agreement

Dear Sirs/Mesdames:

Reference is made to the engagement letter, dated June 11, 2007 (the "Engagement
Letter"),  between CIBC World Markets Inc. (the "Lead  Underwriter") and Zarlink
Semiconductor  Inc. (the  "Company")  and the amended and restated  underwriting
agreement,  dated July 17,  2007 (the  "Underwriting  Agreement"),  between  the
Company and the Lead  Underwriter,  National Bank  Financial  Inc., RBC Dominion
Securities Inc. and Scotia Capital Inc. (the "Underwriters").

This is to confirm the agreement between the Lead Underwriter and the Company in
respect of the Engagement  Letter and the agreement between the Underwriters and
the Company in respect of the Underwriting  Agreement that the  reimbursement by
the Company of the expenses of the Underwriters (including,  without limitation,
fees and expenses of counsel for the Underwriters and out-of-pocket  expenses of
the  Underwriters)  provided by Paragraph 9 of the Engagement Letter and Section
12 of the Underwriting Agreement shall not exceed Cnd$1,000,000.

If you are in agreement  with the  foregoing,  please so indicate by signing and
returning to us the enclosed copy of this letter.

<PAGE>

CIBC WORLD MARKETS INC.

By: /s/ Marwan Kubursi
    -------------------------
    Name: Marwan Kubursi
    Title: Executive Director

<PAGE>

NATIONAL BANK FINANCIAL INC.

By: /s/ Amit Monga
    -------------------------
    Name: Amit Monga
    Title: Vice President

<PAGE>

RBC DOMINION SECURITIES INC.

By: /s/ Scott Davis
    -------------------------
    Name: Scott Davis
    Title: Director, RBC

<PAGE>

SCOTIA CAPITAL INC.

By: /s/ Scott Dorsey
    -------------------------
    Name: Scott Dorsey
    Title: Managing Director

<PAGE>

Agreed and accepted as of the date first above written:

ZARLINK SEMICONDUCTOR INC.

By: /s/ Donald G. McIntyre
    --------------------------------
    Name: Donald G. McIntyre
    Title: Senior Vice President and
           General Counselexv4w3

 

Exhibit 4.3

Form of Subscription Agreement

SUBSCRIPTION AGREEMENT

______ __, 2007

Gentlemen:

     The undersigned (the “Investor”) hereby confirms its agreement with you as follows:

     1. This Subscription Agreement (this “Agreement”) is made as of the date set forth below
between Polymedix, Inc., a Delaware corporation (the “Company”), and the Investor.

     2. The Company has authorized the sale and issuance to certain investors of up to an aggregate
of
                     units (the “Units”), each consisting of (i) ___ shares (each a “Share” and
collectively, the “Shares”) of its common stock, par value $0.001 per share (the “Common Stock”),
and (ii) warrants (“Warrant,” collectively, the “Warrants”) to purchase ___shares of Common Stock
(and the fractional amount being the “Warrant Ratio”), subject to adjustment by the Company’s Board
of Directors, or a committee thereof, for a purchase price of $  per Unit (the “Purchase
Price”). The Shares issuable upon exercise of the Warrants are referred to herein as “Warrant
Shares” and, together with the Units, the Shares and the Warrants, are collectively referred to
herein as the “Securities.”

     3. The offering and sale of the Units (the “Offering”) is being made pursuant to (1) an
effective Registration Statement on Form SB-2 (Registration No. 333-142787) (filed by the Company
with the Securities and Exchange Commission (the “Commission”)) (the “Registration Statement”), (2)
if applicable, certain “free writing prospectuses”(as that term is defined in Rule 405 under the
Securities Act of 1933, as amended), that have or will be filed with the Commission and delivered
to the Investor on or prior to the date hereof, (3) a preliminary prospectus dated May 25, 2007
(the “Preliminary Prospectus”), and (4) a final prospectus (together with the Preliminary
Prospectus, the “Prospectus”) containing certain supplemental information regarding the Units and
terms of the Offering that will be filed with the Commission and delivered to the Investor (or made
available to the Investor by the filing by the Company of an electronic version thereof with the
Commission) along with the Company’s counterpart to this Agreement.

     4. The Company and the Investor agree that the Investor will purchase from the Company and the
Company will issue and sell to the Investor the Units set forth below for the aggregate purchase
price set forth below. The Units shall be purchased pursuant to the Terms and Conditions for
Purchase of Units attached hereto as Annex I and incorporated herein by this reference as if fully
set forth herein. The Investor acknowledges that the Offering is not being underwritten by the
placement agents (the “Placement Agents”) named in the Prospectus Supplement and that there is no
minimum offering amount.

     5. The manner of settlement of the Shares included in the Units purchased by the Investor
shall be determined by such Investor as follows:

3

 

	 	 	Delivery by electronic book-entry at The Depository Trust Company (“DTC”), registered in the
Investor’s name and address as set forth below, and released by The American Stock Transfer
& Trust Company, the Company’s transfer agent (the “Transfer Agent”) (attention:
                     (___) ___-___), to the Investor at the Closing (as defined in Section 3.1 of
Annex A hereto). NO LATER THAN TWO (2) BUSINESS DAYS AFTER THE EXECUTION OF THIS AGREEMENT
BY THE INVESTOR AND THE COMPANY, THE INVESTOR SHALL:

	 	(I)	 	DIRECT THE BROKER-DEALER AT WHICH THE ACCOUNT OR ACCOUNTS TO BE CREDITED WITH
THE SHARES ARE MAINTAINED TO SET UP A DEPOSIT/WITHDRAWAL AT CUSTODIAN (“DWAC”)
INSTRUCTING THE TRANSFER AGENT TO CREDIT SUCH ACCOUNT OR ACCOUNTS WITH THE SHARES, AND
	 
	 	(II)	 	REMIT BY WIRE TRANSFER THE AMOUNT OF FUNDS EQUAL TO THE AGGREGATE PURCHASE
PRICE FOR THE UNITS BEING PURCHASED BY THE INVESTOR TO THE FOLLOWING ACCOUNT:
	 
	 	 	 	JPMorgan Chase Bank NA

ABA # 021000021

Account # 304951404

Account Name: Polymedix / Needham

ref: [subscriber name] Phone: (___) ___-___

IT IS THE INVESTOR’S RESPONSIBILITY TO (A) MAKE THE NECESSARY WIRE TRANSFER OR CONFIRM THE PROPER
ACCOUNT BALANCE IN A TIMELY MANNER AND (B) ARRANGE FOR SETTLEMENT BY WAY OF DWAC IN A TIMELY
MANNER. IF THE INVESTOR DOES NOT DELIVER THE AGGREGATE PURCHASE PRICE FOR THE UNITS OR DOES NOT
MAKE PROPER ARRANGEMENTS FOR SETTLEMENT IN A TIMELY MANNER, THE UNITS MAY NOT BE DELIVERED AT
CLOSING TO THE INVESTOR OR THE INVESTOR MAY BE EXCLUDED FROM THE CLOSING ALTOGETHER.

     6. The executed Warrant shall be delivered in accordance with the terms set forth in Annex I
hereto.

     7. The Investor represents that, except as set forth below, (a) it has had no position, office
or other material relationship within the past three years with the Company or persons known to it
to be affiliates of the Company, (b) it is not a NASD member or an Associated Person (as such term
is defined under the NASD Membership and Registration Rules Section 1011) as of the Closing, and
(c) neither the Investor nor any group of Investors (as identified in a public filing made with the
Commission) of which the Investor is a part in connection with the Offering of the Units, acquired,
or obtained the right to acquire, 20% or more of the Common Stock (or securities convertible into
or exercisable for Common Stock) or the voting power of the Company on a post-transaction basis.
Exceptions: (If no exceptions, write “none.” If left blank, response will be deemed to be
“none.”)

2

 

     8. The Investor represents that it has received or can obtain on the SEC’s Edgar filing system
the Prospectus, which is part of the Company’s Registration Statement, the Preliminary Prospectus,
the documents incorporated by reference therein, and any free writing prospectus (collectively, the
“Disclosure Package”), prior to or in connection with the receipt of this Agreement along with the
Company’s counterpart to this Agreement.

     9. No offer by the Investor to buy Units will be accepted and no part of the Purchase Price
will be delivered to the Company until the Company has accepted such offer by countersigning a copy
of this Agreement, and any such offer may be withdrawn or revoked, without obligation or commitment
of any kind, at any time prior to the Company (or a Placement Agent on behalf of the Company)
sending (in writing, facsimile or by electronic mail) notice of its acceptance of such offer. An
indication of interest will involve no obligation or commitment of any kind until this Agreement is
accepted and countersigned by or on behalf of the Company.

Number of Units:

Purchase Price Per Unit: $

Aggregate Purchase Price: $

3

 

     Please confirm that the foregoing correctly sets forth the agreement between us by signing in
the space provided below for that purpose.

	 	 	 	 	 
	 	 	Dated as of: _____ __, 2007
	 
	 	 	 	 
	 	 	 
	 	 	INVESTOR
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Print Name:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Title:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	Address:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 

Agreed and
Accepted this ___ day of                     , 2007:

POLYMEDIX, INC.

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Title:
	 	 

4

 

ANNEX I

TERMS AND CONDITIONS FOR PURCHASE OF UNITS

     1. Authorization and Sale of the Units; Defined Terms.

          1.1 Subject to the terms and conditions of this Agreement, the Company has authorized the sale
of the Units.

          1.2 Capitalized terms used herein but not otherwise defined have the meanings ascribed to them
in the Agreement.

     2. Agreement to Sell and Purchase the Units; Placement Agents.

          2.1 At the Closing (as defined in Section 3.1), the Company will sell to the Investor, and the
Investor will purchase from the Company, upon the terms and conditions set forth herein, the number
of Units set forth on the last page of the Agreement to which these Terms and Conditions for
Purchase of Units are attached as Annex I (the “Signature Page”) for the aggregate purchase price
therefor set forth on the Signature Page.

          2.2 The Company proposes to enter into substantially this same form of Subscription Agreement
with certain other investors (the “Other Investors”) and expects to complete sales of Units to
them. The Investor and the Other Investors are hereinafter sometimes collectively referred to as
the “Investors,” and this Agreement and the Subscription Agreements executed by the Other Investors
are hereinafter sometimes collectively referred to as the “Agreements.”

          2.3 Investor acknowledges that the Company intends to pay Needham & Company, LLC and WBB
Securities, LLC (collectively, the “Placement Agents”) a fee (the “Placement Fee”) in respect of
the sale of Units to the Investor.

          2.4 The Company has entered into a Placement Agency Agreement, dated July ___, 2007 (the
“Placement Agreement”), with the Placement Agents that contains certain representations,
warranties, covenants, and agreements of the Company that may be relied upon by the Investor, which
shall be a third party beneficiary thereof. A copy of the Placement Agreement is available upon
request.

     3. Closings and Delivery of the Units and Funds.

          3.1 Closing. The completion of the purchase and sale of the Units (the “Closing”) shall occur
at a place and time (the “Closing Date”) to be specified by the Company and the Placement Agents,
and of which the Investors will be notified in advance by the Placement Agents, in accordance with
Rule 15c6-1 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
At the Closing, (a) the Company shall cause the Transfer Agent to deliver to the Investor the
number of Shares set forth on the Signature Page registered in the name of the Investor or, if so
indicated on the Investor Questionnaire attached hereto as Schedule A, in the name of a nominee
designated by the Investor and as contemplated

 Annex I- Page 1

 

by procedures set forth in the Agreement and the Placement Agreement, (b) the Company shall
cause to be delivered to the Investor a Warrant to purchase a number of whole Warrant Shares
determined by multiplying the number of Shares set forth on the signature page by the Warrant Ratio
and rounding down to the nearest whole number and (c) the aggregate purchase price for the Units
being purchased by the Investor will be delivered by or on behalf of the Investor to the Company.

          3.2      (a) Conditions to the Company’s Obligations. The Company’s obligation to issue and sell
the Units to the Investor shall be subject to: (i) the receipt by the Company of the purchase price
for the Units being purchased hereunder as set forth on the Signature Page and (ii) the accuracy of
the representations and warranties made by the Investor and the fulfillment of those undertakings
of the Investor to be fulfilled prior to the Closing Date.

                    (b) Conditions to the Investor’s Obligations. The Investor’s obligation to purchase the Units
will be subject to the accuracy of the representations and warranties made by the Company contained
in the Placement Agreement and the fulfillment of those undertakings of the Company to be fulfilled
prior to the Closing Date those contained in the Placement Agreement and the Subscription
Agreement, and to the condition that the Placement Agents shall not have determined that the
conditions to the closing in the Placement Agreement have not been satisfied. The Investor’s
obligations are expressly not conditioned on the purchase by any or all of the Other Investors of
the Units that they have agreed to purchase from the Company or the issuance of any minimum amount
of Units by the Company.

          3.3 Delivery of Funds by Electronic Book-Entry at The Depository Trust Company. No later
than two (2) business days after the execution of this Agreement by the Investor and the
Company, the Investor shall remit by wire transfer the amount of funds equal to the aggregate
purchase price for the Units being purchased by the Investor to the following account designated by
the Company and the Placement Agents pursuant to the terms of that certain Escrow Agreement (the
“Escrow Agreement”) dated as of ___, 2007, by and among the Company, the Placement Agents and
                     (the “Escrow Agent”):

JPMorgan Chase Bank NA

ABA # 021000021

Account # 304951404

Account Name: Polymedix / Needham

ref: [subscriber name] Phone: (___) ___-____

Such funds shall be held in escrow until the Closing and delivered by the Escrow Agent on behalf of
the Investors to the Company upon the satisfaction, in the reasonable judgment of the Placement
Agents, of the conditions set forth in Section 3.2(b) hereof. The Placement Agents shall have no
rights in or to any of the escrowed funds unless the Placement Agents and the Escrow Agent are
notified in writing by the Company in connection with the Closing that a portion of the escrowed
funds shall be applied to the Placement Fee as contemplated by Section 2(e) of the Placement
Agreement. The Company and the Investor agree to indemnify and hold the Escrow Agent and the
Placement Agents harmless from and against any and all losses, costs, damages, expenses and claims
(including, without limitation, court costs and reasonable attorneys fees) (“Losses”) arising under
this Section 3.3 or otherwise with respect to the funds

 Annex I- Page 2

 

held in escrow pursuant hereto or arising under the Escrow Agreement, unless (i) such Losses
resulted from any material violation by the Escrow Agent or any Placement Agent of any applicable
broker-dealer rules or federal or state securities laws or (ii)it is finally determined that such
Losses resulted directly from the willful misconduct or gross negligence of the Escrow Agent or the
Placement Agents. Anything in this Agreement to the contrary notwithstanding, in no event shall
the Escrow Agent or the Placement Agents be liable for any Losses that exceed the total
compensation received by the Escrow Agent or the Placement Agents, as applicable, pursuant to and
in accordance with any agreement between the Escrow Agent and the Company or the Placement
Agreement, as applicable.

          3.4 Delivery of Shares by Electronic Book-Entry at The Depository Trust Company. No later
than two (2) business days after the execution of this Agreement by the Investor and the
Company, the Investor shall direct the broker-dealer at which the account or accounts to be
credited with the Shares being purchased by such Investor are maintained, which broker/dealer shall
be a DTC participant, to set up a Deposit/Withdrawal at Custodian (“DWAC”) instructing The American
Stock Transfer & Trust Company, the Company’s transfer agent, to credit such account or accounts
with the Shares by means of an electronic book-entry delivery. Such DWAC shall indicate the
settlement date for the deposit of the Shares, which date shall be provided to the Investor by the
Placement Agents. Simultaneously with the delivery to the Company by the Escrow Agent of the funds
held in escrow pursuant to Section 3.3 above, the Company shall direct its transfer agent to credit
the Investor’s account or accounts with the Shares pursuant to the information contained in the
DWAC.

     4. Representations, Warranties and Covenants of the Investor.

          4.1 The Investor represents and warrants to, and covenants with, the Company that (a) the
Investor has answered all questions on the Signature Page and the Investor Questionnaire for use in
preparation of the Prospectus Supplement and the answers thereto are true and correct as of the
date hereof and will be true and correct as of the Closing Date and (b) the Investor, in connection
with its decision to purchase the number of Units set forth on the Signature Page, is relying only
upon the Disclosure Package and the representations and warranties of the Company contained herein
and the Placement Agency Agreement.

          4.2 The Investor acknowledges, represents and agrees that no action has been or will be taken
in any jurisdiction outside the United States by the Company or the Placement Agents that would
permit an offering of the Units, or possession or distribution of offering materials in connection
with the issue of the Units in any jurisdiction outside the United States where action for that
purpose is required. Each Investor outside the United States will comply with all applicable laws
and regulations in each foreign jurisdiction in which it purchases, offers, sells or delivers Units
or has in its possession or distributes any offering material, in all cases at its own expense.
The Placement Agents are not authorized to make and have not made any representation or use of any
information in connection with the issue, placement, purchase and sale of the Units, except as set
forth or incorporated by reference in the Disclosure Package.

          4.3 The Investor further represents and warrants to, and covenants with, the Company that (a)
the Investor has full right, power, authority and capacity to enter into this Agreement and to
consummate the transactions contemplated hereby and has taken all necessary

 Annex I- Page 3

 

action to authorize the execution, delivery and performance of this Agreement, and (b) this
Agreement constitutes a valid and binding obligation of the Investor enforceable against the
Investor in accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ and
contracting parties’ rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as the indemnification agreements of the Investors herein may be
legally unenforceable.

          4.4 The Investor understands that nothing in this Agreement, the Prospectus or any other
materials presented to the Investor in connection with the purchase and sale of the Units
constitutes legal, tax or investment advice. The Investor has consulted such legal, tax and
investment advisors as it, in its sole discretion, has deemed necessary or appropriate in
connection with its purchase of Units.

          4.5 Each Investor represents, warrants and agrees that, since the earlier to occur of (i) the
date on which any Placement Agent first contacted such Investor about the Offering and (ii) the
date of this Agreement, it has not engaged in any transactions in the securities of the Company
(including, without limitation, any Short Sales involving the Company’s securities). Each Investor
covenants that it will not engage in any transactions in the securities of the Company (including
Short Sales) prior to the time that the transactions contemplated by this Agreement have been
consummated and are publicly disclosed. Each Investor agrees that it will not use any of the Units
acquired pursuant to this Agreement to cover any short position in the Common Stock if doing so
would be in violation of applicable securities laws. For purposes hereof, “Short Sales” include,
without limitation, all “short sales” as defined in Rule 200 promulgated under Regulation SHO under
the Exchange Act, whether or not against the box, and all types of direct and indirect stock
pledges, forward sales contracts, options, puts, calls, short sales, swaps, “put equivalent
positions” (as defined in Rule 16a-1(h) under the Exchange Act) and similar arrangements (including
on a total return basis), and sales and other transactions through non-US broker dealers or foreign
regulated brokers.

     5. Survival of Representations, Warranties and Agreements; Third Party Beneficiary.
Notwithstanding any investigation made by any party to this Agreement or by the Placement Agents,
all covenants, agreements, representations and warranties made by the Company and the Investor
herein will survive the execution of this Agreement, the delivery to the Investor of the Units
being purchased and the payment therefor. The Placement Agents shall be third party beneficiaries
with respect to representations, warranties and agreements of the Investor in Section 4 hereof.

     6. Notices. All notices, requests, consents and other communications hereunder will be in
writing, will be mailed (a) if within the domestic United States by first-class registered or
certified airmail, or nationally recognized overnight express courier, postage prepaid, or by
facsimile or (b) if delivered from outside the United States, by International Federal Express or
facsimile, and will be deemed given (i) if delivered by first-class registered or certified mail
domestic, three business days after so mailed, (ii) if delivered by nationally recognized overnight
carrier, one business day after so mailed, (iii) if delivered by International Federal Express, two

 Annex I- Page 4

 

business days after so mailed and (iv) if delivered by facsimile, upon electric confirmation
of receipt and will be delivered and addressed as follows:

	 	(a)	 	if to the Company, to:
	 
	 	 	 	Polymedix, Inc.

170 N. Radnor-Chester Road

Suite 300

Radnor, Pennsylvania 19087

Facsimile: (484) 598-2333

Attention: Edward F. Smith, Chief Financial Officer
	 
	 	 	 	with copies to:

	 
	 	 	 	Pepper Hamilton, LLP

400 Berwyn Park

899 Cassatt Avenue

Berwyn, Pennsylvania 19312

Attention: Jeffrey P. Libson

Facsimile: (610) 640-7835

          (b) if to the Investor, at its address on the Signature Page hereto, or at such other address
or addresses as may have been furnished to the Company in writing.

     7. Changes. This Agreement may not be modified or amended except pursuant to an instrument in
writing signed by the Company and the Investor.

     8. Headings. The headings of the various sections of this Agreement have been inserted for
convenience of reference only and will not be deemed to be part of this Agreement.

     9. Severability. In case any provision contained in this Agreement should be invalid, illegal
or unenforceable in any respect, the validity, legality and enforceability of the remaining
provisions contained herein will not in any way be affected or impaired thereby.

     10. Governing Law. This Agreement will be governed by, and construed in accordance with, the
internal laws of the State of New York, without giving effect to the principles of conflicts of law
that would require the application of the laws of any other jurisdiction.

     11. Counterparts. This Agreement may be executed in two or more counterparts, each of which
will constitute an original, but all of which, when taken together, will constitute but one
instrument, and will become effective when one or more counterparts have been signed by each party
hereto and delivered to the other parties. The Company and the Investor acknowledge and agree that
the Company shall deliver its counterpart to the Investor along with the Prospectus and the
Prospectus Supplement (or the filing by the Company of an electronic version thereof with the
Commission).

 Annex I- Page 5

 

     12. Confirmation of Sale. The Investor acknowledges and agrees that such Investor’s receipt
of the Company’s counterpart to this Agreement, together with the Prospectus and the Prospectus
Supplement (or the filing by the Company of an electronic version thereof with the Commission),
shall constitute written confirmation of the Company’s sale of Units to such Investor.

     13. Termination. In the event that the Company decides to terminate Offering prior to
Closing, this Agreement shall terminate without any further action on the part of the parties
hereto and any monies remitted to the Escrow Agent will be promptly refunded by the Escrow Agent,
without interest, to the Investor.

 Annex I- Page 6

 

SCHEDULE A TO ANNEX I

POLYMEDIX, INC.

INVESTOR QUESTIONNAIRE

Pursuant to Section 3 of Annex I to the Agreement, please provide us with the following
information:

	 	 	 	 	 	 	 	 	 
	 	 	 	1.	 	 	The exact name that your Shares and Warrants are to be registered in. You may
use a nominee name if appropriate:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	2.	 	 	The relationship between the Investor and the registered holder listed in
response to item 1 above:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	3.	 	 	The mailing address of the registered holder listed in response to item 1
above:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	4.	 	 	The Social Security Number or Tax Identification Number of the registered
holder listed in the response to item 1 above:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	5.	 	 	Name of DTC Participant (broker-dealer at which the account or accounts to be
credited with the Shares are maintained); please include the name and telephone number
of the contract person at the broker-dealer:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 

 Schedule A to Annex I- Page  1

 

	 	 	 	 	 	 	 	 	 
	 	 	 	6.	 	 	DTC Participant Number:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	7.	 	 	Name of Account at DTC Participant being credited with the Shares:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	8.	 	 	Account Number at DTC Participant being credited with the Shares:
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 

 Schedule A to Annex I- Page  2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}]]