Document:

com_10q0630ex101.htm

    Exhibit
10.1

     

     

    EXECUTION
COPY

    
      

    

    AMENDMENT
NO. 8 TO

    REVOLVING
CREDIT AND SECURITY AGREEMENT

     

    among

     

    UNIFORCE
SERVICES, INC.,

    BRENTWOOD
SERVICE GROUP, INC.,

    CLINICAL
LABFORCE OF AMERICA, INC.,

    COMFORCE
INFORMATION TECHNOLOGIES, INC.,

    COMFORCE
TECHNICAL, LLC,

    COMFORCE
TECHNICAL SERVICES, INC.,

    COMFORCE
TELECOM, INC.,

    CTS
OF WASHINGTON, LLC,

    PRO
CLINICAL SUPPORT SERVICES, LLC,

    PRO
UNLIMITED GLOBAL, LTD (UK),

    PRO
UNLIMITED GLOBAL (HK) LIMITED,

    PRO
UNLIMITED GLOBAL JAPAN, LTD

    a/k/a
PRO UNLIMITED GLOBAL JAPAN, YK,

    PRO
UNLIMITED, INC.,

    PRO
UNLIMITED MPS, INC.,

    TEMPORARY
HELP INDUSTRY SERVICING COMPANY, INC.,

    UNIFORCE
STAFFING SERVICES, INC.,

    SUMTEC
CORPORATION,

    THISCO
OF CANADA, INC.,

    CTS
GLOBAL, INC.

    (as
Borrowers)

     

    and

     

    COMFORCE
OPERATING, INC.

    (as
Borrowing Agent)

     

    and

     

    COMFORCE
CORPORATION

    (as
Guarantor)

     

    and

     

    PNC
BANK, NATIONAL ASSOCIATION

    (as
Administrative Agent and Lender)

     

    and

     

    THE
OTHER LENDERS PARTY HERETO

    

    as
of June 6, 2008

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      EXECUTION
COPY

    AMENDMENT NO. 8 TO CREDIT
AGREEMENT

     

    This
Amendment No. 8 to Credit Agreement (this “Amendment”) is
executed and delivered by the undersigned as of June 6,
2008.  Reference is hereby made to the Revolving Credit and Security
Agreement, dated as of June 25, 2003, as amended, among COMFORCE Operating, Inc.
(“COI”), as
Borrowing Agent (in such capacity, “Borrowing Agent”),
the Borrowers named therein, COMFORCE Corporation, a Delaware corporation, as
guarantor, GE Business Financial Services Inc. and JPMorgan Chase Bank, N.A., as
Co-Syndication Agents for the Lenders and as Lenders, Webster Business Credit
Corporation, as Documentation Agent for the Lenders and as Lender, the other
financial institutions which hereafter become a party thereto (the “Lenders”), and PNC
Bank, National Association, as Administrative Agent for the Lenders (in such
capacity, “Administrative
Agent”) and as Lender (as the same may be from time to time further
amended, extended, restated, supplemented or otherwise modified, the “Credit
Agreement”).  Capitalized terms used, but not defined herein,
shall have the meanings ascribed to them in the Credit Agreement.

     

    WHEREAS,
COI desires to repurchase the Senior 12% Notes;

    

    WHEREAS,
the Borrowers have requested that the Lenders amend the Credit Agreement as set
forth below to facilitate the payment of the Senior 12% Notes.

     

    NOW
THEREFORE, in consideration of the foregoing and for other consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:

     

    I. AMENDMENT

     

    A. Section
7.19 of the Credit Agreement is hereby amended and restated in its entirety as
follows:

     

    “7.19                      Senior 12% Notes;
Subordinated Notes.  At any time, directly or indirectly,
prepay, repurchase, redeem, retire or otherwise acquire, or make any payment on
account of any principal of, interest on or premium payable in connection with
the repayment or redemption of the Senior 12% Notes or Subordinated Notes;
provided that, notwithstanding the foregoing, (a) COI may repurchase or prepay
any portion of the Senior 12% Notes if (i) immediately before and after giving
effect to such repurchase or prepayment (and all fees, penalties, costs and
expenses incurred in connection therewith), no Default or Event of Default shall
exist hereunder, and (ii) during the period beginning twenty (20) Business Days
prior to any such repurchase or prepayment and ending ten (10) Business Days
after giving effect to such repurchase or prepayment, Borrowers shall have an
average Undrawn Availability throughout such period of not less than $2,500,000,
provided,
however, that such amount shall increase by $1,000,000 each month commencing on
the first day of the month after the month in which COI repurchases or prepays
any Senior 12% Notes or Subordinated Notes until such amount reaches $7,500,000,
and (b) provided there are no available options to pay in kind, COI and Holdings
may make regularly scheduled interest payments in cash then due under and
pursuant to the Senior 12% Notes and the Subordinated Notes as in effect on the
date hereof, respectively, if no Default or Event of Default shall have occurred
and be continuing immediately before any such payment or after 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    giving
effect to any such payment, and (c) the aggregate amount of all such prepayments
and repurchases permitted by clause (a) of this Section 7.19 shall not exceed
$15,000,000 (the “Redemption Allowance”) in any calendar year; provided,
however, that to the extent any portion of the Redemption Allowance for any such
calendar year is not expended to prepay or repurchase the Senior 12% Notes in
such calendar year, then COI may apply all of such unused portion towards the
prepayment or repurchase of the Senior 12% Notes pursuant to clause (a) of this
Section 7.19(a) in any succeeding calendar year to the extent such prepayment or
repurchase is otherwise permitted under clause (a) of this Section
7.19(a).”

     

    B. Section
10.23 of the Credit Agreement is hereby amended and restated in its entirety as
follows:

     

    “10.23                      Undrawn
Availability shall (a) at any time be less than $2,500,000, provided, however,
such amount shall increase by $500,000 each month commencing the first day of
the month after the month in which COI repurchases or prepays any Senior 12%
Notes or Subordinated Notes until such amount reaches $5,000,000, or (b) at any
time within ten (10) Business Days after the consummation of any Permitted
Acquisition, be less than $10,000,000; provided that no more
than once per calendar year if Undrawn Availability shall fall below the minimum
amount required by clause (a) above, no Event of Default shall exist solely by
virtue thereof if within seven (7) days of the date that Undrawn Availability
fell below the minimum amount required by clause (a), Undrawn Availability shall
increase to such minimum amount, which such increased Undrawn Availability shall
be evidenced by a Borrowing Base Certificate delivered to Administrative Agent
in form and substance satisfactory to Administrative Agent; or”

     

    II. CONDITIONS
PRECEDENT

     

    The
effectiveness of this Amendment is subject to the satisfaction of each of the
following conditions:

     

    A.           Borrowers
shall have delivered to Agent a fully executed original of this
Amendment.

     

    B.           The
representations and warranties in Section II hereof shall be true and
correct as of the date hereof and after giving effect to each of the
transactions contemplated hereby.

     

    III. REPRESENTATIONS
AND WARRANTIES

     

    Each of
the Borrowers, Borrowing Agent and Guarantor hereby represent and warrant to the
Lenders and Agent as follows:

     

    A.           The
execution, delivery and performance by each such Person of this Amendment and
the transactions contemplated hereby (a) are within such Person’s corporate or
limited liability company power; (b) have been duly authorized by all corporate
or limited liability company or other necessary action; (c) are not in
contravention of any provision of any such Person’s certificate of incorporation
or formation, operating agreement, bylaws or other documents of organization;
(d) do not violate any law or regulation, or any order or decree of any
Governmental Body; (e) do not conflict with or result in the breach or
termination of, constitute a 

     

    
      
        
        

      

      
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    default
under or accelerate any performance required by, any indenture, mortgage, deed
of trust, lease, agreement or other instrument to which such party is a party or
by which such party or any of its respective property is bound; (f) do not
result in the creation or imposition of any Lien upon any Borrower’s property or
any property of such Borrower’s respective Subsidiaries (other than Liens in
favor of Agent) and (g) do not require the consent or approval of any
Governmental Body or any other Person.

     

    B.           This
Amendment has been duly executed and delivered by such Person and constitutes
the legal, valid and binding obligation of such Person, enforceable against each
such Person in accordance with its terms except as the enforceability hereof may
be limited by bankruptcy, insolvency, reorganization, moratorium and other laws
affecting creditors’ rights and remedies in general.

     

    C.           Each
representation and warranty of such Person contained in the Credit Agreement and
the Other Documents is true and correct on the date hereof in all material
respects and will be true and correct in all material respects as if made
immediately after giving effect to this Amendment (except to the extent such
representation or warranty relates to an earlier date, in which case such
representation and warranty is true and correct in all material respects on and
as of such earlier date).

     

    D.           No
Default or Event of Default has occurred and is continuing.

     

    IV. PLEDGORS’
CONSENT

     

    The undersigned Pledgors, in their
respective capacity as Pledgors, hereby consent to this Amendment and to the
consummation of the transactions contemplated hereby and hereby restate, ratify
and confirm their respective pledge in support of the Obligations pursuant to
the terms of their respective Pledge Agreements, in all respects, after giving
effect to the consents and amendments set forth herein and the consummation of
the transactions contemplated hereby. Although each Pledgor has been informed of
the matters set forth herein and has acknowledged and consented to the same,
each Pledgor understands and agrees that neither the Administrative Agent nor
any Lender has any obligation to inform Pledgors of such matters in the future
or to seek any Pledgor’s acknowledgment, consent or agreement to future
amendments and nothing herein shall create such duty.

     

    V. GUARANTOR’S
CONSENT

     

    The undersigned Guarantor, in its
respective capacity as Guarantor, hereby consents to this Amendment and to the
consummation of the transactions contemplated hereby and hereby restates,
ratifies and confirms its joint and several guaranty of the prompt payment of
the Obligations of the Borrowers pursuant to its Guaranty, in all respects,
after giving effect to the amendments set forth herein and the consummation of
the transactions contemplated hereby.  Although the Guarantor has been
informed of the matters set forth herein and has acknowledged and consented to
the same, the Guarantor understands and agrees that neither the Administrative
Agent nor any Lender has any obligation to inform the Guarantor of such matters
in the future or to seek the Guarantor’s acknowledgment, consent or agreement to
future amendments and nothing herein shall create such duty.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    VI. MISCELLANEOUS

     

    A. Each of
the Borrowers, the Borrowing Agent and the Guarantor acknowledges and confirms
to Agent and the Lenders that the Credit Agreement and each Other Document to
which it is a party shall remain in full force and shall continue to evidence,
secure or otherwise guarantee and support the obligations owing by such Person
to Agent and Lenders pursuant thereto and pursuant to the Notes, and, after
giving effect to this Amendment, each such Person hereby ratifies and affirms
each of the foregoing documents to which it is a party.

     

    B. Each of
the Borrowers, the Borrowing Agent and the Guarantor acknowledges and reaffirms
to Agent and the Lenders that (i) the Liens granted to Agent for the benefit of
the Lenders under the Credit Agreement and the Other Documents remain in full
force and effect and shall continue to secure the obligations of Borrowers
arising under the Credit Agreement and the Other Documents, and (ii) the
validity, perfection or priority of the Liens will not be impaired by the
execution and delivery of this Amendment.

     

    C. Each of
the Borrowers, the Borrowing Agent and the Guarantor acknowledges and agrees
that no Lender has waived or shall be deemed to have waived any of its rights or
remedies under the Credit Agreement or any of the Other Documents which
documents shall remain in full force and effect in accordance with their
terms.

     

    D. Borrowers
shall promptly pay to Agent all costs and expenses including, without
limitation, reasonable attorneys’ fees and disbursements incurred by Agent on
its behalf or on behalf of the Lenders in connection herewith, which amount may
be charged to Borrowers’ Account and shall be part of the
Obligations.

     

    E.           This
Amendment is limited to the subject matter hereof and may be executed in any
number of counterparts, including by telecopy, and by the various parties hereto
on separate counterparts, each of which when so executed and delivered shall be
an original, but all of which shall together constitute one and the same
instrument.

     

    E.           THIS
AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE INTERNAL LAWS OF THE STATE
OF NEW YORK WITHOUT REGARD TO ITS CONFLICTS OF LAWS PRINCIPLES AND SHALL BE
BINDING UPON AND INURE TO THE BENEFIT OF THE SUCCESSORS AND ASSIGNS OF THE
PARTIES HERETO.

     

    *                 *                 *

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    
 

     

    IN WITNESS WHEREOF, each of
the parties hereto, by their officers duly authorized, has executed this
Amendment as of the date first above written.

     

    

      
        	 
      	
                COMFORCE
      OPERATING, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                UNIFORCE
      SERVICES, INC.,

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                BRENTWOOD
      SERVICE GROUP, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                COMFORCE
      TECHNICAL, LLC

                By:
      COMFORCE Technical Services, Inc.,

                       Its
      Sole Member

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                COMFORCE
      INFORMATION TECHNOLOGIES, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                PRO
      UNLIMITED MPS, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	 
      	 
      
	 
      	
                COMFORCE
      TECHNICAL SERVICES, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 	 
	 
      	
                COMFORCE
      TELECOM, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 	 
	 
      	
                CLINICAL
      LABFORCE OF AMERICA, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      
        	 
      	 
      
	 
      	
                PRO
      UNLIMITED, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                TEMPORARY
      HELP INDUSTRY SERVICING COMPANY, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                UNIFORCE
      STAFFING SERVICES, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                SUMTEC
      CORPORATION

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	 
      	 
      
	 
      	
                THISCO
      OF CANADA, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                CTS
      OF WASHINGTON, LLC

                By:
      COMFORCE Technical Services, Inc.,

                       Its
      Sole Member

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                PRO
      CLINICAL SUPPORT

                SERVICES,
      LLC

                By:
      Pro Unlimited, Inc.,

                       Its
      Sole Member

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                PRO
      UNLIMITED GLOBAL JAPAN, LTD. a/k/a PRO UNLIMITED GLOBAL JAPAN,
      YK

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                PRO
      UNLIMITED GLOBAL, LTD. (UK)

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                PRO
      UNLIMITED GLOBAL (HK), LIMITED

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	 
      	 
      
	 
      	
                CTS
      GLOBAL, INC.

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      	 
      
	 	 
	 
      	
                COMFORCE
      CORPORATION

              
	 
      	 
      	 
      
	 
      	
                By:

              	 
      
	 
      	 
      	
                Name:

              
	 
      	 
      	
                Title:

              
	 
      	 
      	 
      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      
        	 
      	 
      	 
      
	 
      	 
      
	 
      	
                PNC
      BANK, NATIONAL ASSOCIATION, as Administrative Agent and as
      Lender

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	 
      	 
      
	 
      	 
      
	 
      	
                JPMORGAN
      CHASE BANK, N.A., as Co-Syndication Agent and Lender

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              
	 
      	 
      
	 	 
	 
      	
                GE
      BUSINESS FINANCIAL SERVICES INC., as Co-Syndication Agent and
      Lender

              
	 
      	 
      
	
                By:

              	 
      
	 
      	
                Name:

              

      

      

      
        	 	 
      
	 	
                WEBSTER
      BUSINESS CREDIT CORPORATION, as Documentation Agent and
    Lender

              
	 	 
      	 
      
	 	
                By:

              	 
      
	 	 
      	
                Name:exv10w1

Exhibit 10.1

IMAX CORPORATION

Stock Option Plan

June 2008

 

 

IMAX CORPORATION

AMENDED & RESTATED STOCK OPTION PLAN

1. Purpose

     The purposes of the IMAX Stock Option Plan (the “Plan”) are to attract, retain and motivate
directors, officers, key employees and consultants of the Company and its Subsidiaries and to
provide to such persons incentives and awards for superior performance.

2. Definitions

     As used in this Plan the following terms have the following meanings:

     “Agreement” has the meaning set forth in Section 6 below.

     “Award” means an Option.

     “Blackout Period” means any period during which a policy of the Company prevents an Insider
from trading in the Common Shares.

     “Board” means the Board of Directors of the Company.

     “Cause” means a termination of the Participant’s employment with the Company or one of its
Subsidiaries (a) for “cause” as defined in an employment agreement applicable to the Participant,
or (b) in the case of a Participant who does not have an employment agreement that defines “cause”,
because of: (i) any act or omission that constitutes a material breach by the Participant of any of
his obligations under his employment agreement with the Company or one of its Subsidiaries or the
applicable Agreement; (ii) the continued failure or refusal of the Participant to substantially
perform the duties reasonably required of him as an employee of the Company or one of its
Subsidiaries; (iii) any wilful and material violation by the Participant of any law or regulation
applicable to the business of the Company or one of its Subsidiaries, or the Participant’s
conviction of a felony, or any wilful perpetration by the Participant of a common law fraud; or
(iv) any other wilful misconduct by the Participant which is materially injurious to the financial
condition or business reputation of, or is otherwise materially injurious to, the Company or any of
its Subsidiaries.

     “Change of Control” means an event or series of events where any person, or group of persons
acting in concert, not including Bradley J. Wechsler and Richard L. Gelfond, acquire greater than
fifty percent (50%) of the outstanding Common Shares of the Company whether by direct or indirect
acquisition or as a result of a merger, reorganization or sale of substantially all of the assets
of the Company.

     “Code” means the U.S. Internal Revenue Code of 1986, as amended.

     “Committee” means a committee of the Board comprised of at least two directors selected by the
Board to administer the Plan.

     “Common Share” means a share of common stock, no par value, of the Company.

     “Company” means IMAX Corporation, a corporation organized under the laws of Canada.

     “Date of Grant” means the date specified by the Board or the Committee on which an Award shall
become effective (which date shall not be earlier than the date on which the Board or the Committee
takes action with respect thereto).

     The “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

1

 

     “Fair Market Value” of a Common Share on a given date means the higher of the closing price of
a Common Share on such date (or the most recent trading date if such date is not a trading date) on
Stock Exchanges.

     “Insider” means any person who is a director or an officer of the Company or any Subsidiary,
or who is directly or indirectly the beneficial owner of, or who exercises control or direction,
more than 10% of total Common Shares issued by the Company.

     “Option” means the right to purchase a Common Share upon exercise of a stock option granted
pursuant to the Plan.

     “Option Price” means the purchase price per Common Share payable on exercise of an Option, as
determined by the Committee in its sole discretion (subject to the terms of the Plan) and as set
forth in the applicable Agreement.

     “Participant” means a person to whom an Award is to be made under the Plan and who is at the
time of such Award an employee or consultant of the Company, or any of its Subsidiaries, or a
person who is a director of the Company or any of its Subsidiaries and who is not also an employee
of the Company or any of its Subsidiaries at the Date of Grant, or a person who has agreed to
commence serving in any such capacity within 90 days of the Date of Grant, or any personal holding
corporation controlled by any such person, the shares of which are held directly or indirectly by
such person or such person’s spouse, minor children or minor grandchildren, or any registered
retirement savings plan or registered educational savings plan for the sole benefit of any such
person.

     “Permanent Disability” means a physical or mental disability or infirmity of the Participant
that prevents the normal performance of substantially all his duties as an employee of the Company
or any Subsidiary, which disability or infirmity shall exist for any continuous period of 180 days
within any twelve-month period.

     “Stock Exchanges” means one or more, as the context requires, of the NASDAQ Global Market, the
Toronto Stock Exchange and such securities exchange, if any, as may be designated by the Board,
from time to time.

     “Subsidiary” means any corporation or other entity in which the Company owns or controls,
directly or indirectly, not less than 50% of the total combined voting power represented by all
voting securities or other voting interests in such entity.

     “Vested Options” means, as of any date, Options which by their terms are exercisable on such
date.

3. Administration of the Plan

	 	(a)	 	The Plan shall be administered, and Awards shall be granted hereunder, by the
Board or by or under the authority of the Committee. A majority of the Committee shall
constitute a quorum, and the action of the members of the Committee present at any
meeting at which a quorum is present, or acts unanimously approved in writing, shall be
the acts of the Committee.
	 
	 	(b)	 	The interpretation and construction by the Committee of any provision of the Plan
or of any Agreement, and any determination by the Committee pursuant to any provision of
this Plan or of any Agreement shall be final and conclusive. No member of the Committee
shall be liable for any such action or determination made in good faith.

2

 

4. Shares Available Under Plan

     The maximum number of Common Shares which may be issued upon the exercise of Options granted
under the Plan is 20% of the issued and outstanding Common Shares, subject to adjustment as
provided in Section 10. Such Common Shares may be shares previously issued or treasury shares or a
combination of the foregoing. Any Common Shares which are subject to Options which have been
exercised, have expired or which have been surrendered without being exercised in full shall again
be available for issuance under this Plan, resulting in a “reloading” of the Plan up to this
maximum percentage of issued and outstanding Common Shares.

5. Limitations on Certain Grants

     Section 162(m) of the Code requires that the Plan include a limitation on the number of
Options which may be granted to certain Participants. The Board or Committee may, from time to time
and upon such terms and conditions as it may determine, grant Options to Participants provided,
however, the maximum number of Options intended to qualify for exemption under Section 162(m) of
the Code that may be awarded to any Participant in any calendar year shall not exceed 4,000,000.

6. Agreement

     The terms and conditions of each Option shall be embodied in a written agreement (the
“Agreement”) in a form approved by the Committee which shall contain terms and conditions not
inconsistent with the Plan and which shall incorporate the Plan by reference. Options granted under
the Plan shall comply with the following terms and conditions:

	 	(a)	 	Each Agreement shall specify the number of Common Shares for which Options have
been granted.
	 
	 	(b)	 	Each Agreement shall specify the Option Price, which shall not be less than 100%
of the Fair Market Value per Common Share on the Date of Grant.
	 
	 	(c)	 	Each Agreement shall specify that the Option Price shall be payable in cash or by
cheque acceptable to the Company or by a combination of such methods of payment.
	 
	 	(d)	 	Successive grants may be made to the same Participant whether or not any Options
previously granted to such Participant remain unexercised.
	 
	 	(e)	 	Each Agreement shall specify the applicable vesting schedule and the effective
term of the Option. In the event of a termination of a Participant’s employment by
reason of death or Permanent Disability, 50% of such Participant’s Options shall become
Vested Options if such Options were less than 50% vested at the time of such
termination.
	 
	 	(f)	 	Options granted under the Plan are not intended to qualify as “incentive stock
options” within the meaning of Section 422A of the Code.
	 
	 	(g)	 	No Option issued prior to June 18, 2008 shall be exercisable more than ten years
from the Date of Grant. No Options issued on or after June 18, 2008, subject to earlier
cancellation, shall be exercisable for the later of ten years from the Date of Grant, or
in the event the 10 year anniversary of the Date of Grant falls within a Blackout
Period, the date which is ten days after the date on which the Blackout Period has
ended.
	 
	 	(h)	 	Each Option granted under the Plan shall be subject to such additional terms and
conditions, not inconsistent with the Plan, which are prescribed by the Board or the
Committee and set forth in the applicable Agreement.

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	 	(i)	 	As soon as practicable following the exercise of any Options, the Common Shares
subject to the exercised Options shall be issued in the name of the Participant or as
the Participant shall otherwise, in writing, direct.

7. Termination of Employment, Consulting Agreement or Term of Office

	 	(a)	 	In the event that a Participant’s employment, consulting arrangement or term of
office with the Company or one of its Subsidiaries terminates for any reason, unless the
Board or the Committee determines otherwise, any Options which have not become Vested
Options shall terminate and be cancelled without any consideration being paid therefor.
	 
	 	(b)	 	In the event that a Participant’s employment with the Company or one of its
Subsidiaries is terminated without Cause, or the Participant’s employment is terminated
by reason of the Participant’s voluntary resignation (including by reason of
retirement), death or Permanent Disability, or upon the termination of a Participant’s
consulting arrangement or term of office, the Participant (or the Participant’s estate)
shall be entitled to exercise the Participant’s Options which have become Vested Options
as of the date of termination for a period of 30 days, or such longer period as the
Board or the Committee determines, following the date of termination.
	 
	 	(c)	 	In the event that a Participant’s employment, consulting arrangement or term of
office with the Company or one of its Subsidiaries is terminated for Cause, such
Participant’s Vested Options shall terminate and be cancelled without any consideration
being paid therefor.

8. Transferability

     No Option shall be transferable by a Participant other than by will or the laws of descent and
distribution, provided, however, that Options may be transferred if approved by the Board or the
Committee and by any regulatory authority having jurisdiction or stock exchange on which the Common
Shares subject to Options are listed. Options shall be exercisable during the Participant’s
lifetime only by the Participant or by the Participant’s guardian or legal representative.

9. Change of Control

     All Options granted under the Plan (or any predecessor of the Plan) shall immediately vest and
become fully exercisable upon the occurrence of (a) a Change of Control; and (b) the occurrence of
one or more of the following: (i) the Participant’s employment or term of office with the Company,
or one of its Subsidiaries, is terminated without Cause; (ii) the diminution of the Participant’s
title and/or responsibilities; and (iii) the Participant is asked to relocate more than twenty-five
(25) miles from his/her existing office.

10. Adjustments

     The Committee shall make or provide for such adjustments in the maximum number of Common
Shares specified in Section 4, in the number of Common Shares or other securities or consideration
covered by outstanding Options granted hereunder, and/or in the Option Price applicable to such
Options as the Board or the Committee in their sole discretion may determine is equitably required
to prevent dilution or enlargement of the rights of Participants that otherwise would result from
any stock dividend, stock split, combination of shares, recapitalization or other change in the
capital structure of the Company, merger, consolidation, spin-off, reorganization, partial or
complete liquidation, issuance of rights or warrants to purchase securities or any other corporate
transaction or event having an effect similar to any of the foregoing.

11. Fractional Shares

     The Company shall not be required to issue any fractional Common Shares pursuant to the Plan.
The Committee may provide for the elimination of fractions or for the settlement of fractions in
cash.

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12. Withholding Taxes

     The Company and its Subsidiaries shall have the right to require any individual entitled to
receive Common Shares pursuant to an Option to remit to the Company, prior to the issuance of any
Common Share following the exercise of any Options, any amount sufficient to satisfy any Canadian
or United States federal, state, provincial or local tax withholding requirements. Prior to the
Company’s determination of such withholding liability, such individual may make an irrevocable
election to satisfy, in whole or in part, such obligation to remit taxes by directing the Company
to withhold Common Shares that would otherwise be received by such individual. Such election may be
denied by the Company in its discretion, or may be made subject to certain conditions specified by
the Company, including, without limitation, conditions intended to avoid accounting charges and the
imposition of liability against the individual under Section 16(b) of the Exchange Act, as amended,
and the rules and regulations thereunder.

13. Registration Restrictions

     An Option shall not be exercisable unless and until (i) a registration statement under the
Securities Act of 1933, as amended, has been duly filed and declared effective pertaining to the
Common Shares subject to such Option, or (ii) the Committee, in its sole discretion determines that
such registration, qualification and status is not required as a result of the availability of an
exemption from such registration, qualification, and status under such laws.

14. Shareholder Rights

     A Participant shall have no rights as a shareholder with respect to any Common Shares issuable
upon exercise of an Option until the Participant has duly exercised the Option in accordance with
its terms and this Plan, and the Common Shares have been paid for in full and issued to the
Participant.

15. Breach of Restrictive Covenants

     If (i) a Participant is a party to an employment agreement with the Company or any of its
Subsidiaries or affiliates and (ii) such Participant materially breaches any of the restrictive
covenants set forth in such employment agreement (including, without limitation, any restrictive
covenants relating to non-competition, non-solicitation or confidentiality), then all of such
Participant’s Options (whether or not Vested Options) shall terminate and be cancelled without
consideration being paid therefor.

16. Section 409A of the Code

     If any provision of the Plan or any Agreement contravenes any regulations or Treasury guidance
promulgated under Section 409A of the Code or would cause the Awards to be subject to the interest
and penalties under Section 409A of the Code, such provision of the Plan or any Agreement shall be
modified to maintain, to the maximum extent practicable, the original intent of the applicable
provision without violating the provisions of Section 409A of the Code.

17. Amendments

     The Board or the Committee reserves the right, in its sole discretion, to amend, suspend or
terminate the Plan or any portion thereof at any time, and outstanding Options or Agreements
thereunder, in accordance with applicable legislation, without obtaining the approval of
shareholders; provided, however, that no termination or amendment of the Plan or any waiver of any
provision of any Option or Agreement may, without the consent of the Participant to whom any Award
shall have been granted, adversely affect the rights of such Participant in such Award; provided
further, however that amendments shall be subject to (i) the approval of a majority of the Common
Shares entitled to vote if the Committee determines that such approval is necessary in order for
the Company to rely on the exemptive relief provided under Rule 16b-3 under the Exchange Act and
(ii) all other approvals, whether regulatory, shareholder or otherwise, which are required by
regulatory authority having jurisdiction or a Stock Exchange. Notwithstanding the foregoing, the
Company will be required to obtain the approval of the shareholders of the Company for any
amendment related to:

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          a) reduces the Option Price of an Award held by an Insider;

          b) extends the term of an Award held by an Insider, except as otherwise provided in
Section 19; or

          c) increases the number of Common Shares reserved under the Plan.

18. Miscellaneous

     The Plan shall not confer upon a Participant any right with respect to continuance of
employment or other service with the Company or any Subsidiary, nor will it interfere in any way
with any right the Company or any Subsidiary would otherwise have to terminate such Participant’s
employment or other service at any time.

19. Black Out Periods

     Except as otherwise provided in Section 6(g) or in any Option Agreement, if the date on which
an Option expires occurs during or within 10 days after the last day of a Blackout Period, the
expiry date for the Option will be 10 days after the date on which the Blackout Period has ended.

20. Effective Date

     The Plan, as amended, shall be effective as of June 18, 2008.

21. Governing Law

     The Plan and all rights hereunder shall be construed in accordance with and governed by the
laws of the Province of Ontario and the laws of Canada applicable therein.

June 2008

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