Document:

QuickLinks
 -- Click here to rapidly navigate through this document
  

Exhibit 10.16  

 
 

EMPLOYMENT AGREEMENT    
    

        This Employment Agreement (the "Agreement") is hereby entered into effective as of April 12, 2006, between DynCorp International LLC, a Delaware limited
liability company (the "Company"), and Robert B. Rosenkranz ("Executive"). 

        In
consideration of the mutual promises and covenants contained herein, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 

1.     Employment.  

        1.1.    Position.    During the Term (as hereinafter defined) of this Agreement, and subject to the terms and
conditions set forth herein, the Company agrees to employ Executive as a Vice President, and President of its ITS Division, reporting to the President of the Company. 

        1.2.    Fulfillment of Duties.    During the Term of this Agreement, Executive shall (i) devote his full
business time and best efforts to the performance of his services hereunder, excluding vacation periods and periods of illness or incapacity, and (ii) perform his services hereunder faithfully,
diligently and to the best of his skill and ability. 

        1.3.    Location.    During the Term of this Agreement, Executive will perform his duties and services at the
Company's Falls Church, Virginia office or such location(s) as he shall deem appropriate, except that Executive agrees to make such business trips to the Company's other locations as may be reasonable
and necessary in the performance of his services hereunder. 

2.     Compensation and Benefits.  

        2.1.    Salary.    In consideration of and as compensation for the services agreed to be performed by Executive
hereunder, the Company agrees to pay Executive during the Term of this Agreement a base annual salary (the "Base Salary") of not less than $360,000 per year, less standard deductions and withholdings,
payable bi- monthly in accordance with the Company's regular payroll practices. The Company will review Executive's Base Salary and other compensation (including bonuses and incentive
compensation) from time to time during the Term of this Agreement and, at the recommendation of the Compensation Committee (the "Committee") of the Board, may increase his Base Salary or other
compensation (including incentive compensation) from time to time. Any increase in Base Salary or other compensation (including incentive compensation) shall in no way limit or reduce any other
obligation of the Company hereunder and, once established at an increased rate, Executive's Base Salary hereunder shall not be reduced. 

        2.2.    Incentive Compensation.    During the Term of this Agreement, in addition to the Base Salary provided in
Section 2.1 above, Executive shall be eligible to receive additional incentive compensation in an amount not to exceed amounts prescribed in the Company's Executive Incentive Compensation Plan
("Plan") using a target incentive percentage of no less than 50% ("Incentive Compensation"); provided, however, that no portion of his Incentive Compensation shall be paid in shares of the Company
unless the Executive requests the delivery of such shares. The Executive shall also be entitled to the benefits of any modifications or amendments to such Plan adopted after the effective date hereof
that enhance benefits payable under the Plan. 

        2.3.    Other Benefits.    During the Term of this Agreement, Executive shall be entitled to the benefits listed on
Exhibit A, and any other benefits adopted after the effective date of this Agreement for the benefit of senior executives of the Company; provided that such additional benefits shall not in any
way limit or detract from the benefits described on Exhibit A. 

1

 

3.     Term.  

        3.1.    Term.    The term of employment under this Agreement means the period that commenced on April 1, 2006
and expiring at midnight on March 31, 2011; provided, that this Agreement will automatically renew for additional periods of one (1) year each commencing on April 1 of each
successive year following the initial Term unless written notice of intent not to renew is delivered by the Company or the Executive to the other party at least 90 days prior to the effective
date of any renewal hereof. 

3.2.  Termination of Employment  

        Executive's employment with the Company may be terminated under the following conditions: 

        3.2.1.    Retirement, Death or Disability.    Executive's employment with the Company shall terminate effective upon
the date of Executive's Retirement from the Company (as defined in Section 5.5), resignation from the Company, death or "Complete Disability" (as defined in Section 5.1). 

        3.2.2.    For Cause.    The Company may terminate Executive's employment under this Agreement for Cause (as defined in
Section 5.2) by delivery of written notice to Executive specifying the Cause or Causes relied upon for such termination. Any notice of termination given pursuant to this Section 3.2.2
shall effect termination as of the date specified in such notice or, in the event no such date is specified, on the last day of the month in which such notice is delivered or deemed delivered as
provided in Section 7.3 below. 

        3.2.3.    Without Cause.    The Company may terminate Executive's employment under this Agreement at any time and for
any reason by delivery of written notice of such termination to Executive. Any notice of termination given pursuant to this Section 3.2.3 shall take effect as of the date specified in such
written notice. 

        3.2.2.    Termination by Executive for Good Cause.    Executive may terminate Executive's employment with the Company
for Good Cause (as defined in Section 5.3) upon thirty (30) days written notice to the Company. 

        3.2.3.    Termination by Mutual Agreement of the Parties.    Executive's employment pursuant to this Agreement may be
terminated at any time upon the mutual written agreement of the parties. Any such termination of employment shall have the consequences specified in such mutual agreement. 

        3.2.4.    Board/Committee Resignation.    Upon termination of Executive's employment for any reason, Executive agrees
to resign, as of the date of such termination and to the extent applicable, from the Board (and any committees thereof) and the Board of Directors (and any committees thereof) of any of the Company's
affiliates. 

4.     Compensation upon Termination.  

        4.1.    Retirement, Death or Complete Disability.    If Executive's employment is terminated by his Retirement, death
or Complete Disability, Executive (or his heirs or legal representative) shall be entitled to Executive's Base Salary and accrued and unused vacation earned through the date of termination, subject to
standard deductions and withholdings. In addition, upon Executive's (or his heirs or legal representative) furnishing to the Company an executed waiver and release of claims (a 

2

 

form
of which is attached hereto as Exhibit B, which will be revised for signature by Executive's heirs or legal representative if applicable), Executive (or his heirs or legal representative)
shall be entitled to: 

        4.1.1. a pro rated portion of his Incentive Compensation that would be payable to the Executive based on projected Company
performance through the termination date, less standard deductions and withholdings; and 

        4.1.2. exercise any vested options to purchase stock (common or otherwise) in the Company granted to Executive pursuant to
any plan, agreement or otherwise, or any equivalent or similar vested rights which appreciate or tend to appreciate as the value of the Company's stock appreciates, such options and rights to be in
accordance with the terms of 

any
applicable plan or agreement, it being understood that the provisions of this Section 4.1.2 shall have no applicability to the rights of Executive as a Class B Member of DIV Holding
LLC and nothing contained in this Agreement shall operate to change, amend or vary any of the terms of the Amended and Restated Limited Liability Company Operating Agreement of DIV Holding LLC, as
amended from
time to time; provided, however, that Executive or his estate or legal representative shall have a period of 90 days following the date of termination within which to exercise or satisfy all
such options or rights. 

        4.2.    Termination for Cause by the Company or Resignation by Executive.    If Executive's employment is terminated
by the Company for Cause or if Executive resigns (other than for Good Cause), the Company shall pay Executive's accrued Base Salary and accrued and unused vacation benefits earned through the date of
termination at the rate in effect at the time of the notice of termination to Executive or Executive's notice of resignation to the Company. 

        4.3.    Termination without Cause by the Company or Termination by the Executive for Good Cause.    If the Company
terminates Executive's employment without Cause (except under any circumstance in which Section 4.1 is applicable to Executive, in which case this Section 4.3 shall not apply), or if the
Executive terminates this Agreement for Good Cause, Executive shall be entitled to Executive's Base Salary and a pro rated portion of his Incentive Compensation that would be payable to the Executive
based on projected Company performance through the termination date, less standard deductions and withholdings, and accrued and unused vacation earned through the date of termination, subject to
standard deductions and withholdings. In addition, upon Executive's furnishing to the Company an executed copy of the waiver and release of claims (a form of which is attached hereto as
Exhibit B), Executive (or his heirs or legal representative) shall be entitled to: 

        4.3.1. a payment equivalent to 2.0 times the Executive's Annual Base Compensation in effect at the time of Termination, less
standard deductions and withholdings, payable in two equal lump sum payments the first payment on the first payroll date that is six months following such termination, and the second payment on the
first payroll date that is twelve months following such termination, in accordance with the Company's regular payroll practices; 

        4.3.2. exercise any vested options to purchase stock (common or otherwise) in the Company granted to Executive pursuant to
any plan, agreement or otherwise, or any equivalent or similar vested rights which appreciate or tend to appreciate as the value of the Company's stock appreciates, such options and rights to be in
accordance with the terms of any applicable plan or agreement, it being understood that the provisions of this Section 4.3.2 shall have no applicability to the rights of Executive as a
Class B Member of DIV Holding LLC and nothing contained in this Agreement shall operate to change, amend or vary any of the terms of the Amended and Restated Limited Liability Company Operating
Agreement of DIV Holding LLC, as amended from time to time; provided, however, that Executive or his estate or legal representative shall have a period of 90 days following the date of
termination within which to exercise or satisfy all such options or rights; and 

3

 

        4.3.3. elect reimbursement to the Executive (or his heirs or legal representatives) for the same portion of Executive's COBRA
health insurance premium that it paid during Executive's employment up until
the earlier of either (i) the last day of Executive's COBRA health insurance benefits or, ii) the date on which Executive becomes covered under any other group health plan (as an
employee or otherwise). 

5.    Definitions.    For purposes of this Agreement, the following terms shall have
the following meanings: 

        5.1.    Complete Disability.    "Complete Disability" shall mean the inability of Executive to perform Executive's
duties under this Agreement because Executive has become permanently disabled within the meaning of any policy of disability income insurance covering employees of the Company then in force. In the
event the Company has no policy of disability income insurance covering employees of the Company in force when Executive becomes disabled, the term "Complete Disability" shall mean the inability of
Executive to perform Executive's duties under this Agreement by reason of any incapacity, physical or mental, which the Board, based upon medical advice or an opinion provided by a licensed physician
acceptable to the Board, determines to have incapacitated Executive from satisfactorily performing all of Executive's usual services for the Company for a period of at least one hundred twenty
(120) days during any twelve (12) month period (whether or not consecutive). Based upon such medical advice or opinion, the determination of the Board shall be final and binding and the
date such determination is made shall be the date of such Complete Disability for purposes of this Agreement. 

        5.2.    For Cause.    For "Cause" shall mean: 

        5.2.1. the willful and continued failure by Executive to substantially perform his duties with the Company (other than any
such failure resulting from his incapacity due to physical or mental illness, injury or disability), after a written demand for substantial performance is delivered to his by the Board that
identifies, in reasonable detail, the manner in which the Board believes that Executive has not substantially performed his duties in good faith; 

        5.2.2. the willful engaging by Executive in conduct that causes material harm to the Company, monetarily or otherwise; 

        5.2.3. Executive's conviction of a felony arising from conduct during the Term of this Agreement; 

        5.2.4. Executive's willful malfeasance or willful misconduct in connection with Executive's duties hereunder; or 

        5.2.5. For purposes of this Subsection 5.2 no act, or failure to act, on Executive's part shall be considered "willful"
unless done, or omitted to be done, by him not in good faith and without reasonable belief that his action or omission was in the best interest of the Company or its shareholders. 

        5.3.    Good Cause.    "Good Cause" shall mean any of the following actions taken by the Company or any subsidiary
that employs the Executive: assignment of the Executive to duties that are materially inconsistent with his status as a senior executive or which represent a substantial diminution of his duties or
responsibilities in the Company, a reduction in Executive's Base Salary, except in connection with an across-the-board salary reduction for all executives, a failure by the
Company to pay any of Executive's compensation in accordance with Company policy, a substantial reduction in or elimination of any of the benefits described on Exhibit A, the relocation of the
Executive to a location more than 35 miles from Washington, D.C. without Executive's consent, change of Executive's title, a failure to comply with the obligations of the Company under Sections 1.1
and 1.2 hereof, or the failure of a successor to the Company to confirm in writing within 5 business days of its succession its obligation to assume and perform all obligations of this Agreement,  provided that any such events described in this 

4

 

Section 5.3
shall constitute Good Cause only if the Company fails to cure such event within 30 days after receipt from Executive of written notice of the event which constitutes Good
Cause. 

        5.4.    Annual Base Compensation.    "Annual Base Compensation" shall mean the total of the Executive's most recent
annual salary and target incentive under the Company's Executive Incentive Plan. 

        5.5.    Retirement.    "Retirement" shall mean the voluntary retirement of the Executive from the Company
(a) at or after age 62 or (b) at any time after the combination of the Executive's age and service with the company or any predecessor or subsidiary equals or exceeds 75 years. 

6.     Non-Solicitation and Confidentiality.  

        6.1.    Non-Solicitation.    Executive hereby covenants and agrees that during the Term of this Agreement
and for a period of one year following the termination of this Agreement, he will not directly or through a third party employ or solicit for employment any employees of the Company or any persons who
were employees of the Company at any time during the twelve-month period immediately prior to any such solicitation or proposed solicitation or employment. 

        6.2.    Confidentiality.    Except as required by law or an order of a court or governmental agency with jurisdiction,
the Executive shall not, during the period he is employed by the Company and for a period of one year thereafter, disclose Confidential Information (as defined below) to any person or entity for
any reason or purpose whatsoever. Executive shall take all reasonable steps to safeguard the Confidential Information and to protect it against disclosure, misuse, espionage, loss and theft. All such
Confidential Information shall remain the exclusive property of the Company. 

        6.3    Confidential Information.    For purposes of this Agreement and specifically Section 6.2 above,
"Confidential Information" shall mean non-public information concerning the Company's business or operations, plans, strategies, prospects or objectives; its sales, services, support and
marketing plans, practices and operations; the prices, costs and details of its services or prospective services; the financial condition and results of its operations; information received from third
parties under confidential conditions; the Company's personnel and compensation policies; and means of gaining access to the Company's computer data systems and related information. "Confidential
Information" shall not include general knowledge based on Executive's experience in the industry, information generally known in the industry, or information that is or becomes generally available to
the public other than as a result of disclosure by the Executive. 

7.     Miscellaneous.  

        7.1.    Indemnification.    The Company agrees at all times during the term of this Agreement and thereafter, to
indemnify, defend and hold the Executive, his heirs, estate and legal representatives harmless from, any and all claims, liabilities, demands, allegations, causes of action, or other threats, related
to or in any way arising out of, the services provided by the Executive under this Agreement or at the request of the Company; provided, however, that this indemnification shall not apply to acts or
omissions that are the result of conduct that would preclude the Executive from receiving indemnification under Section 145 of the Delaware General Corporation Law in effect from time to time.
Upon receipt of notice of the assertion of any such claim, liability, demand, allegation, cause of action or other threat, the Company shall pay the Executive the cost of his defense by a counsel
mutually acceptable to the Company and Executive, and shall be responsible for the full payment of any judgment including damages or penalties, including punitive damages or penalties, that may be
assessed or payable as a result of a settlement to which the Company and the Executive consent, including the deductible portion of any loss covered by Director and Officer Liability Insurance.
Nothing herein shall limit the rights of the Executive to the protections afforded by the Company's Directors and Officers Liability Insurance as in effect from time to time. 

5

 

        7.2.    Compliance with Company Policies.    During the term of this Agreement, the Executive shall at all times
comply with all applicable Company policies and procedures, including the Company's Standards of Business Conduct. 

        7.3.    Notices.    Any written notice, required or permitted under this Agreement, shall be deemed sufficiently given
if either hand delivered or if sent by fax or overnight courier. Written notices must be delivered to the receiving party at his or its address on the signature page of this Agreement. The parties may
change the address at which written notices are to be received in accordance with this section. 

        7.4.    Assignment.    Executive may not assign, transfer, or delegate his rights or obligations hereunder and any
attempt to do so shall be void. This Agreement shall be binding upon and shall inure to the benefit of the Company and its successors and assigns and the term "Company" as used herein shall include
such successors and assigns to the extent applicable. 

        7.5.    Entire Agreement.    This Agreement, including Exhibits A and B, contains the entire agreement of the parties
with respect to the subject matter hereof, and all other prior agreements, written or oral, are hereby superseded and are of no further force or effect; provided, however, that any and all prior
agreements covering the benefits described in Exhibit A shall continue in full force and effect in accordance with their terms. This Agreement may be modified or amended only by a written
agreement that is signed by the Company and Executive. No waiver of any section or provision of this Agreement will be valid unless such waiver is in writing and signed by the party against whom
enforcement of the waiver is sought. The waiver by the Company of any section or provision of this Agreement shall not apply to any subsequent breach of this Agreement. Captions to the various
sections in this Agreement are for the convenience of the parties only and shall not affect the meaning or interpretation of this Agreement. This Agreement may be executed in several counter-parts,
each of which shall be deemed an original, but together they shall constitute one and the same instrument. 

        7.6.    Severability.    The provisions of this Agreement shall be deemed severable, and if any part of any provision
is held illegal, void, or invalid under applicable law such provision may be changed to the extent reasonably necessary to make the provision, as so changed, legal, valid and binding. If any provision
of this Agreement is held illegal, void, or invalid in its entirety, the remaining provisions of this Agreement shall not in any way be affected or impaired but shall remain binding in accordance with
their terms. 

        7.7    Withholding Taxes.    The Company may withhold from any amounts payable under this Agreement such Federal,
state and local taxes as may be required to be withheld pursuant to any applicable law or regulation. 

        7.8.    Applicable Law.    This Agreement and the rights and obligations of the Company and Executive thereunder shall
be governed by and construed and enforced under the laws of the State of New York without regard to New York's conflict of laws rules. 

[The
remainder of this page is intentionally left blank] 

6

 

        In
Witness Whereof, the parties have executed this Agreement effective as of the date first above written. 

	 	 	DynCorp International LLC
	

 	
 	

By:	
 	

/s/ STEPHEN J. CANNON
 DynCorp International

Attn: President

8445 Freeport Pkwy

Irving, Texas 75063
	

with a copy to:	
 	

 	
 	

Schulte Roth & Zabel LLP

Attn: Benjamin M. Polk, Esq.

919 Third Avenue

New York, NY 10022
	

 	
 	

Executive
	

 	
 	

By:	
 	

/s/ ROBERT B. ROSENKRANZ
 Robert B. Rosenkranz
	at:	 	 	 	DynCorp International

3190 Fairview Park Drive

Falls Church, VA 22042

7

   EXHIBIT A  

 Benefits for Executive's Employment Agreement  

	1.
	Benefits,
including Disability, Long Term, Life Insurance, and Salary Continuation, no less favorable to the Executive than that set forth in the Enhanced Executive Benefit Program.

	2.
	Equity
in DIV Holding LLC in accordance with the terms set forth in the Amended and Restated Limited Liability Company Operating Agreement of DIV Holding LLC dated as of
February 11, 2005 as amended by Amendment No. 1 dated as of November 22, 2005 and Amendment No. 2 dated as of March 14, 2006, and as hereinafter amended from time to
time.

	3.
	Specialty
insurance (such as kidnap and ransom and company travel insurance) under which Executive was covered immediately preceding the commencement of the Term of this Agreement.

	4.
	Standard
medical plan options no less favorable to the Executive than that offered by the Company immediately preceding the commencement of the Term of this Agreement.

	5.
	Automobile
Allowance no less favorable to the Executive than that provided by the Company immediately preceding the commencement of the Term of this Agreement.

	6.
	Vacation
in accordance with the Company's Personal Time Off Policy.

	7.
	Standard
Company holidays plus two floating holidays.

	8.
	Executive
Incentive Compensation plan with terms no less favorable to the Executive than the Plan or practice in effect immediately preceding the commencement of the Term of this
Agreement.

	9.
	Director &
Officer Liability Insurance as maintained by the Company for the protection of the members of its Board of Directors.

	10.
	Annual
physical examination (to the extent not reimbursed by group health coverage.) 

i

   EXHIBIT B  

 RELEASE AND WAIVER OF CLAIMS  

        In consideration of the payments and other benefits set forth in the Employment Agreement dated April     , 2006, to which this form is attached,
I, Robert B. Rosenkranz, hereby furnish DynCorp International Inc. (the "Company"), with the following release and waiver
("Release and Waiver"). 

        I
hereby release, and forever discharge the Company, its officers, directors, agents, employees, stockholders, successors, assigns affiliates and benefit plans, all of their past and
present officers, directors, agents, and insurers, in all capacities, including individually (all of which organizations and persons are hereinafter collectively identified as the
"Company Parties"), from any and all claims, demands, actions, indemnities, liabilities, or obligations of whatever kind and nature, which I may have
had, may now have, or may hereafter claim to have through the date this Release and Waiver is executed, whether known or unknown, contingent or otherwise, at law or in equity, including, without
limitation, any claim arising at any time prior to and including my employment termination date with respect to any claims relating to my employment and the termination of my employment, all
compensation and benefits relating to my employment (including but not limited to, claims for salary, bonuses, commissions, stock, stock options, vacation pay, fringe benefits, severance pay or any
form of compensation); any claim of discrimination based on my race, color, religion, sex, national origin, or disability, if any; any claim that the Company Parties have violated any federal, state
or local statute, regulation, or ordinance with respect to my employment or the cessation thereof, including, without limitation, Title VII of the Civil Rights Act of 1964, 42 U.S.C. §
1981, the Employee Retirement Income Security Act of 1974, the Family and Medical Leave Act, and the ordinances of the County            and the City
of                        ; any claim that the
Company Parties have wrongfully terminated my employment or breached any oral, written, express, or implied employment agreement; any claim that the Company Parties have intentionally or negligently
inflicted emotional distress, mental anguish or humiliation on me; any claim of the breach of any implied covenant of good faith and fair dealing; any claim of damages, monetary or other personal
relief, and/or attorney's fees in any administrative and/or judicial proceeding initiated by me, by any third party on my behalf, or by any governmental authority prior to or following my execution of
this Release and Waiver; any claim of libel, slander and/or defamation of character; any retaliation, "whistleblower," or public policy claim; and any other claim of whatever kind not specifically
identified in this Release and Waiver; provided, however, that this release does not extend to and will not release the Company from any of its obligations under the Employment Contract or  Exhibit A thereof. 

        I
acknowledge that, among other rights, I am waiving and releasing any rights I may have under ADEA, that this Release and Waiver is knowing and voluntary, and that the consideration
given for
this Release and Waiver is in addition to anything of value to which I was already entitled as an Executive of the Company. I further acknowledge that I have been advised, as required by the Older
Workers Benefit Protection Act, that: (a) the Release and Waiver granted herein does not relate to claims which may arise after this Release and Waiver is executed; (b) I have the right
to consult with an attorney, at my expense, prior to executing this Release and Waiver (although I may choose voluntarily not to do so); (c) I have twenty-one (21) days from
the date of termination of my employment with the Company in which to consider this Release and Waiver (although I may choose voluntarily to execute this Release and Waiver earlier); (d) I am
entitled to revoke my consent to this Release and Waiver within seven (7) days following the execution of this Release by delivering written revocation notice
to                        at
[Address] and (e) this Release and Waiver shall not be effective until the seven (7) day revocation period has expired. If I timely revoke this Release and Waiver
after signing it, this Release and Wavier will become null and void and the Company will have no obligation to provide me any of the consideration given for this Release and Waiver. 

i

QuickLinks

EMPLOYMENT AGREEMENTFiled by Automated Filing Services Inc. (604) 609-0244 - Counterpath Solutions, Inc. - Exhibit 10.1

	ARRANGEMENT AGREEMENT 
	 
	among: 
	 
	COUNTERPATH SOLUTIONS, INC., 
	a Nevada corporation; 
	 
	6789722 CANADA INC., 
	a Canada corporation; 
	 
	and 
	 
	NEWHEIGHTS SOFTWARE CORPORATION, 
	a Canadian corporation 
	 
	Dated as of June 15, 2007 

TABLE OF CONTENTS 

	  	  	Page 
	  	  	  	  
	1.
      	DESCRIPTION OF TRANSACTION 	1 
	  	1.1 	Implementation Steps by the
      Company 	1 
	  	1.2 	Implementation Steps by Parent and ExchangeCo 	2 
	  	1.3 	Interim Order 	2 
	  	1.4 	Articles of
      Arrangement 	3 
	  	1.5 	Adjustments in the Parent
      Stock Exchange Ratio and the Exchangeable Share Exchange Ratio 	 4
	  	1.6 	Management
      Proxy Circular 	4 
	  	1.7 	Preparation of Filings
	4 
	  	  	  	  
	2. 	REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY 	5
  
	  	  	  	  
	3. 	REPRESENTATIONS
      AND WARRANTIES OF PARENT AND EXCHANGECO 	5
  
	  	  	  	  
	4. 	CERTAIN
      COVENANTS PENDING COMPLETION OF THE ARRANGEMENT 	6
  
	  	4.1 	Access and
      Investigation 	6 
	  	4.2 	Operation of Business 	6 
	  	4.3 	No
      Solicitation. 	8 
	  	  	  	  
	5.
      	ADDITIONAL COVENANTS OF THE PARTIES 	10 
	  	5.1 	Securityholders’ Meetings.
      	10 
	  	5.2 	Regulatory
      Approvals 	10 
	  	5.3 	Company Options 	11 
	  	5.4 	Indemnification of Officers and Directors 	11 
	  	5.5 	Additional Agreements
	12 
	  	5.6 	Board of
      Directors 	12 
	  	5.7 	Officers 	13 
	  	5.8 	Financing
      	13 
	  	  	  	  
	6.
      	CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND
      EXCHANGECO 	13 
	  	6.1 	Accuracy of Representations
      	13 
	  	6.2 	Performance
      of Covenants 	13 
	  	6.3 	Securityholder Approval;
      Exercise of Dissent Rights 	14 
	  	6.4 	Consents
    	14 
	  	6.5 	Agreements and Documents
    	14 
	  	6.6 	No Material
      Adverse Change 	14 
	  	6.7 	Court Orders 	15 
	  	6.8 	No
      Restraints 	15 
	  	6.9 	No Governmental or Other
      Litigation 	15 
	  	6.10 	Compliance
      with Section 3(a)(10) of the Securities Act 	15 
	  	6.11 	Liabilities and Working
      Capital 	15 
	  	6.12 	Employment
      Arrangements 	15 
	  	6.13 	Bell Canada Debt 	15 
	  	6.14 	Wesley
      Clover Debt 	16 
	  	  	  	  
	7.
      	CONDITIONS
      PRECEDENT TO OBLIGATION OF THE COMPANY 	16
      
	  	7.1
      	Accuracy
      of Representations 	16
      
	  	7.2
      	Performance
      of Covenants 	16
      
	  	7.3
      	Securityholder
      Approval 	16
      

2 

	  	7.4
      	Consents
      	16
      
	  	7.5
      	Agreements
      and Documents 	16
      
	  	7.6
      	No
      Material Adverse Change 	17
      
	  	7.7
      	Court
      Orders 	17
      
	  	7.8
      	No
      Restraints 	17
      
	  	7.9
      	No
      Governmental or Other Litigation 	17
      
	  	7.10
      	Compliance
      with Section 3(a)(10) of the Securities Act 	17
      
	  	7.11
      	Cash
      and Receivables 	18
      
	  	  	  	  
	8.
      	TERMINATION
      	18
      
	  	8.1
      	Termination
      	18
      
	  	8.2
      	Effect
      of Termination 	19
      
	  	8.3
      	Expenses
      	19
      
	  	  	  	  
	9.
      	MISCELLANEOUS
      PROVISIONS 	19
      
	  	9.1
      	Amendment
      	19
      
	  	9.2
      	Waiver
      	19
      
	  	9.3
      	No
      Survival of Representations and Warranties 	20
      
	  	9.4
      	Entire
      Agreement; Counterparts 	20
      
	  	9.5
      	Applicable
      Law; Jurisdiction 	20
      
	  	9.6
      	Assignability
      	20
      
	  	9.7
      	Notices
      	20
      
	  	9.8
      	Cooperation
      	21
      
	  	9.9
      	Severability
      	21
      
	  	9.10
      	Currency
      	22
      
	  	9.11
      	Construction
      	22
      

ARRANGEMENT AGREEMENT 

     THIS ARRANGEMENT AGREEMENT
(“Agreement”) is made and entered into as of June 15, 2007, by and among
COUNTERPATH SOLUTIONS, INC., a Nevada Corporation (“Parent”); 6789722
CANADA INC., a Canada corporation and a direct wholly owned subsidiary of
Parent (“ExchangeCo”), and NEWHEIGHTS SOFTWARE CORPORATION, a Canada
corporation (the “Company”). Certain capitalized terms used in this Agreement
are defined in Schedule A. 

RECITALS 

A. The respective boards of directors of the Company, Parent
and ExchangeCo and have approved the transactions contemplated by this
Agreement, and the board of directors of the Company has agreed to submit the
Plan of Arrangement and the other transactions contemplated hereby to its
shareholders for approval; 

B. The Arrangement is intended to provide to holders of Common
Shares who are Canadian Residents (as defined in Section 1.4) the opportunity to
dispose of their Common Shares in return for Exchangeable Shares on a
tax-deferred or “rollover” basis for Canadian income tax purposes pursuant to
the provisions of Section 85 of the Income Tax Act (Canada) and Section 1.4; and

C. In order to induce Parent to enter into this Agreement and
to consummate the Arrangement, concurrently with the execution and delivery of
this Agreement certain shareholders of the Company are executing shareholder
support agreements in favor of Parent (the “Shareholder Support Agreements”).

AGREEMENT 

The parties to this Agreement, intending to be legally bound,
agree as follows: 

	1. 	
      DESCRIPTION OF TRANSACTION

	 	 	 
	1.1 	
      Implementation Steps by the Company

	 	 	 
		
      The Company covenants in favor of Parent and ExchangeCo
      that the Company shall:

	 	 	 
		(a) 	
      as soon as practicable after the execution of this
      Agreement, apply in a manner acceptable to Parent, acting reasonably,
      under Section 192 of the CBCA for an order approving the Arrangement and
      for the Interim Order, and thereafter proceed with and diligently pursue
      the obtaining of the Interim Order;

	 	 	 
		(b) 	
      as soon as practicable after the execution of this
      Agreement, convene and hold the Company Securityholders’ Meeting in
      accordance with Section 5.1 for the purpose of considering the Arrangement
      Resolution (and for any other proper purpose as may be acceptable to
      Parent, acting reasonably, and as may be set out in the notice for such
      meeting); provided, however, that the Company and Parent, acting
      reasonably and jointly, shall be entitled to adjourn or postpone the
      Company Securityholders’ Meeting for a period of time agreed to by both
      the Company and Parent, if on the scheduled date of such Company
      Securityholders’ Meeting all of the Consents required pursuant to Section
      6.4 have not been obtained;

	 	 	 
		(c) 	
      subject to obtaining such approvals as are required by
      the Interim Order, proceed with and diligently pursue the application to
      the Court under Section 192 of the CBCA for the Final
  Order;

2 

		(d) 	
      subject to obtaining the Final Order and the satisfaction
      or waiver of the other conditions herein contained in favor of each party,
      send to the Director, for endorsement and filing by the Director, the
      Articles of Arrangement and such other documents as may be required in
      connection therewith under the CBCA to give effect to the Arrangement
      pursuant to Section 192 of the CBCA;

	 	 	 
		(e) 	
      on or prior to the Effective Date and subject to
      obtaining the Final Order and the satisfaction or waiver of the other
      conditions herein contained in its favor, execute and deliver the
      Exchangeable Share Support Agreement and the Voting and Exchange Trust
      Agreement; and

	 	 	 
		(f) 	
      provide Parent with copies of and a reasonable
      opportunity to comment on all applications, circulars and other documents
      prepared by or on behalf of the Company in connection with the Arrangement
      and make any changes to such applications, circulars and documents as are
      acceptable to the Company and Parent, each acting reasonably.

	 	 	 
	1.2 	
      Implementation Steps by Parent and
    ExchangeCo

     Parent and ExchangeCo covenant in
favor of the Company that, on or prior to the Effective Date and subject to
obtaining the Final Order and the satisfaction or waiver of the other conditions
herein contained in favor of Parent and ExchangeCo: 

		(a) 	
      Parent shall, as soon as reasonably practicable, amend
      the certificate of incorporation and charter of the Parent to create the
      Special Voting Shares;

	 	 	 
		(b) 	
      Parent and ExchangeCo shall execute and deliver the
      Exchangeable Share Support Agreement;

	 	 	 
		(c) 	
      Parent shall amend the articles of ExchangeCo to create
      Exchangeable Shares prior to the Effective Time in a manner reasonably
      acceptable to the Company;

	 	 	 
		(d) 	
      Parent and ExchangeCo shall execute and deliver the
      Voting and Exchange Trust Agreement;

	 	 	 
		(e) 	
      Parent shall issue to and deposit with the Trustee the
      Special Voting Share in consideration of the payment to the Parent of
      $1.00; and

	 	 	 
		(f) 	
      Parent shall execute the Registration Rights
      Agreement.

	 	 	 
	1.3 	
      Interim Order

     In the notice of motion for the
application contemplated by Section 1.1(a), the Company shall request that the
Interim Order provide: 

	 	(a) 	
      for the class of Persons to whom notice is to be provided
      in respect of the Arrangement and the Company Securityholders’ Meeting and
      for the manner in which such notice is to be provided;

	 	 	 
	 	(b) 	
      that the requisite approval for the Arrangement
      Resolution shall be two-thirds of the votes cast on the Arrangement
      Resolution by the Company Securityholders, voting as a single class,
      present in person or by proxy at the Company Securityholders’ Meeting, and
      that each holder of Common Shares is entitled to one vote for each Common
      Share held and each holder of Company Options is entitled to the number of
      votes represented by the

3 

	 		
      number of Common Shares into which such holder’s Company
      Option is convertible, rounded to the nearest whole share and without
      regard to vesting requirements, if any;

	 	 	 
	 	(c) 	
      that, in all other respects, the terms, restrictions and
      conditions of the bylaws and articles of incorporation of the Company,
      including quorum requirements and all other matters, shall apply in
      respect of the Company Securityholders’ Meeting; provided, however,
      the Company shall request that the Interim Order provide that the
      Company and Parent, acting reasonably and jointly, shall be entitled to
      adjourn or postpone the Company Securityholders’ Meeting for a period of
      time agreed to by both the Company and Parent, if on the scheduled date of
      such Company Securityholders’ Meeting all of the Consents required
      pursuant to Section 6.4 have not been obtained; and

	 	 	 
	 	(d) 	
      for the grant of Dissent Rights to the holders of Common
      Shares.

As part of its application for the Interim Order and the Final
Order, the Company and the Parent shall, prior to the hearing in relation to the
Final Order, advise the Court that the Company intends to rely on the exemption
from the registration requirements of the United States Securities Act of
1933 provided by Section 3(a)(10) of that enactment based on the Court's
approval of the fairness of the Arrangement. 

	1.4 	Articles of Arrangement

     The Articles of Arrangement
shall, with such other matters as are necessary to effect the Arrangement, and
all as subject to the provisions of the Plan of Arrangement, provide
substantially as follows: 

	 	(a) 	
      that each outstanding Common Share (other than (i) the
      Common Shares that are held by holders who have exercised their Dissent
      Rights in accordance with Article 3 of the Plan of Arrangement and who are
      ultimately entitled to be paid the fair value for such Common Shares and
      (ii) the Common Shares that are held by Parent or any of its Affiliates,
      if any) that is held by a holder who is a resident of Canada for purposes
      of the Income Tax Act (Canada) (a “Canadian Resident”) and has elected, in
      a duly completed letter of transmittal and election form deposited with
      the Company no later than the Election Deadline, shall be transferred by
      the holder thereof to ExchangeCo in exchange for that number of fully paid
      and non-assessable Exchangeable Shares equal to the Exchange Ratio, as
      such number may be adjusted in accordance with Section 1.5 (hereinafter
      referred to as the “Exchangeable Share Exchange Ratio”) and the name of
      each such holder will be removed from the register of holders of Common
      Shares and added to the register of holders of Exchangeable Shares and
      ExchangeCo will be recorded as the holder of such Common Shares so
      transferred and shall be deemed to be the legal and beneficial owner
      thereof; provided that, for purposes of clarifying the foregoing, (1) the
      holders of Common Shares who are Canadian Residents and who make or are
      deemed to have made an effective Parent Stock Election (as defined below)
      on or prior to the Election Deadline will no longer be, and (2) the
      holders of Common Shares who are not Canadian Residents will not be,
      entitled to receive Exchangeable Shares and will be entitled to receive
      only shares of Parent Common Stock in accordance with Section
    1.4(b);

	 	 	 
	 	(b) 	
      that each outstanding Common Share (other than: (i) the
      Common Shares that are held by holders who have exercised their Dissent
      Rights in accordance with Article 3 of the Plan of Arrangement and who are
      ultimately entitled to be paid the fair value for such Common Shares, and
      (ii) the Common Shares that are held by Parent or any of its Affiliates,
      if any) that is held by a holder who is not a Canadian Resident or who is
      a Canadian Resident that has elected, in a duly completed letter of
      transmittal and election form deposited with the Company (a “Parent Stock
      Election”) no later than the Election

4 

	 		
      Deadline or has been deemed to have so elected shall be
      transferred by the holder to Parent in exchange for that number or
      fractions of fully paid and non-assessable shares of Parent Common Stock
      equal to the Exchange Ratio, as such number may be adjusted in accordance
      with Section 1.5 (hereinafter referred to as the “Parent Stock Exchange
      Ratio”), and the name of each such holder of Common Shares shall be
      removed from the register of holders of Common Shares and added to the
      register of holders of Parent Common Stock and the Parent will be recorded
      as the holder of such Common Shares so transferred and will be deemed to
      be the legal and beneficial owner thereof;

	 	 	 
	 	(c) 	
      no fractional Exchangeable Shares or fractional shares of
      Parent Common Stock shall be delivered and all such fractions shall be
      rounded down to the nearest whole number; and

	 	 	 
	 	(d) 	
      that each Company Option that is outstanding and
      unexercised immediately prior to the Effective Time will be exchanged for
      an option to purchase Parent Common Stock pursuant to the terms of Section
      5.3.

	1.5 	Adjustments in the Parent Stock Exchange
      Ratio and the Exchangeable Share Exchange Ratio.
  

     If, between the date of this
Agreement and the Effective Time, the outstanding Common Shares or Parent Common
Stock are changed into a different number or class of shares by reason of any
stock split, division or subdivision of shares, stock dividend, reverse stock
split, consolidation of shares, reclassification, recapitalization or other
similar transaction, then the Parent Stock Exchange Ratio and the Exchangeable
Share Exchange Ratio shall be appropriately adjusted.

	1.6 	Management Proxy Circular

     As promptly as practicable after
the execution of this Agreement, and in any event within 14 days thereafter, the
Company, in consultation with Parent, shall prepare the Management Proxy
Circular (which shall be in form and content acceptable to Parent, acting
reasonably) together with any other documents required by the Canadian
Securities Laws or other applicable Legal Requirements in connection with the
Arrangement, and the Company shall cause the Management Proxy Circular and other
documentation required in connection with the Company Securityholders’ Meeting
to be sent to each holder of Common Shares and Company Options and filed as
required by the Interim Order and applicable Legal Requirements. 

	1.7 	Preparation of Filings

	 	(a) 	
      Parent and the Company shall use their reasonable efforts
      to co-operate with one another in:

	 	 	 	 
	 		(i) 	
      the preparation of any application for the orders, any
      required registration statements and any other documents reasonably deemed
      by Parent or the Company to be necessary to discharge their respective
      obligations under United States federal or state securities laws and under
      Canadian Securities Laws in connection with the Arrangement and the other
      transactions contemplated hereby;

	 	 	 	 
	 		(ii) 	
      the taking of all such action as may be required under
      any applicable United States federal or state securities laws (including
      “blue sky laws”) and any applicable Canadian Securities Laws in connection
      with the issuance of the Exchangeable Shares and the Parent Common Stock
      in connection with the Arrangement or the issuance and exercise of the
      Replacement Options, if any are outstanding immediately prior to the
      Effective Time; provided, however,
that,

5 

	 			
      notwithstanding anything to the contrary contained in
      this Agreement, with respect to the United States “blue sky” and Canadian
      Securities Laws, neither Parent nor the Company (or any Subsidiary or
      Affiliate of Parent or the Company) shall be required to register or
      qualify as a foreign corporation or reporting issuer where any such Entity
      is not now or on the Effective Date so registered or qualified;
  and

	 	 	 	 
	 		
      (iii) 
	the taking of all such action as may be required under
      the CBCA in connection with the transactions contemplated by this
      Agreement and the Plan of Arrangement.
	 	 	 	 
	 	(b) 	
      Each of Parent and the Company shall furnish to the other
      all such information concerning it and its shareholders as may be required
      for the effectuation of the actions described in Section 1.6 and this
      Section 1.7.

	 	 	 	 
	 	(c) 	
      Each of Parent and the Company will notify the other
      promptly of the receipt of any comments from Canadian Securities
      Commissions, the SEC or its staff and of any request by Canadian
      Securities Commissions, the Director, the SEC or its staff for amendments
      or supplements to the Management Proxy Circular or a registration
      statement described in Section 1.6 or for additional information, and will
      supply the other with copies of all correspondence with Canadian
      Securities Commissions, the SEC or its staff with respect to the
      Management Proxy Circular or any such registration statement. Parent and
      the Company shall each promptly notify the other if at any time before or
      after the Effective Time it becomes aware that the Management Proxy
      Circular or an application for an order or a registration statement
      described in Section 1.6 contains any untrue statement of a material fact
      or omits to state a material fact required to be stated therein or
      necessary to make the statements contained therein not misleading in light
      of the circumstances in which they are made, or that otherwise requires an
      amendment or supplement to the Management Proxy Circular or such
      application or registration statement. In any such event, Parent and the
      Company shall co-operate in the preparation of a supplement or amendment
      to the Management Proxy Circular or such other document, as required and
      as the case may be, and, if required, shall cause the same to be
      distributed to shareholders of the Company and/or filed with the relevant
      securities regulatory authorities and/or stock exchanges.

	 	 	 	 
	 	(d) 	
      The Company shall ensure that the Management Proxy
      Circular complies with all applicable Legal Requirements. Without limiting
      the generality of the foregoing, the Company shall ensure that the
      Management Proxy Circular provides the Company Securityholders with
      information in sufficient detail to permit them to form a reasoned
      judgement concerning the matters to be placed before them at the Company
      Securityholders’ Meeting and Parent shall provide all information
      regarding Parent reasonably necessary for the Company to do
  so.

	2. 	REPRESENTATIONS AND WARRANTIES OF THE
      COMPANY 

     The Company’s representations and
warranties to Parent and ExchangeCo are set forth in Schedule B attached hereto.

	3. 	REPRESENTATIONS AND WARRANTIES OF PARENT AND
      EXCHANGECO 

     Parent’s and ExchangeCo’s
representations and warranties to the Company are set forth in Schedule C
attached thereto. 

6 

	4. 	
      CERTAIN COVENANTS PENDING COMPLETION OF THE
      ARRANGEMENT

	 	 
	4.1 	
      Access and
Investigation

	 	(a) 	
      During the period from the date of this Agreement to the
      earlier of (A) the Effective Time and (B) the termination of this
      Agreement pursuant to the terms of Section 8.1 (the “Pre- Closing
      Period”), the Company and Parent shall, and shall cause their respective
      Representatives to: (1) provide the other and their respective
      Representatives with reasonable access to their Representatives, personnel
      and assets and to all existing books, records, Tax Returns, work papers
      and other documents and information relating to the Acquired Corporations
      or Parent, as the case may be; and (2) provide the other and their
      respective Representatives with such copies of the existing books,
      records, Tax Returns, work papers and other documents and information
      relating to the Acquired Corporations or Parent, as the case may be, and
      with such additional financial, operating and other data and information
      as the other may reasonably request.

	 	 	 
	 	(b) 	
      Parent and the Company agree that the Confidentiality
      Agreement shall apply to all documents and information provided pursuant
      to Section 4.1(a).

	4.2 	
      Operation of Business.

	 	 	 	 
		(a) 	
      During the Pre-Closing Period: (i) the Company and Parent
      shall ensure that each of them conducts their business and operations (A)
      in the ordinary course and in accordance with past practices and (B) in
      compliance with all applicable Legal Requirements; (ii) shall use all
      reasonable efforts to ensure that each of them preserves intact its
      current business organization, keeps available the services of its current
      officers and employees and maintains its relations and goodwill with all
      suppliers, customers, landlords, creditors, licensors, licensees,
      employees and other Persons having business relationships with them; (iii)
      keep in full force all existing insurance policies or renewals thereof;
      (iv) cause to be provided all notices, assurances and support required by
      any Contract relating to any Proprietary Asset in order to ensure that no
      condition under such Contract occurs that could result in, or could
      increase the likelihood of a breach or violation thereof; (v) shall
      promptly notify the other of (A) any notice or other communication from
      any Person alleging that the Consent of such Person is or may be required
      in connection with any of the transactions contemplated by this Agreement,
      and (B) any Legal Proceeding commenced, or, to the best of its knowledge
      threatened against, relating to or involving or otherwise affecting any
      party or that relates to the consummation of the transactions contemplated
      by this Agreement.

	 	 	 	 
		(b) 	
      During the Pre-Closing Period, the Company shall not and
      shall not permit any Acquired Corporation, on the one hand, and Parent, on
      the other, shall not (except (i) with the prior written consent of the
      other party, which shall not be unreasonably withheld or delayed and (ii)
      with respect to any matter that is expressly required by this
      Agreement):

	 	 	 	 
			(i) 	
      declare, accrue, set aside or pay any dividend or make
      any other distribution in respect of any shares of capital stock, or
      repurchase, redeem or otherwise reacquire any of its shares or other
      securities;

	 	 	 	 
			(ii) 	
      except as contemplated herein, amend or permit the
      adoption of any amendment to its certificate of incorporation or bylaws or
      other charter or organizational documents, or effect or become a party to
      any merger, arrangement, consolidation, share exchange, business
      combination, amalgamation, recapitalization, reclassification of shares,
      stock split, reverse stock split, division or subdivision of shares,
      consolidation of shares or similar
transaction;

7 

	 	(iii) 	
      enter into or become bound by, or permit any of the
      assets owned or used by it to become bound by, (A) any material contract,
      or amend or terminate, or waive or exercise any material right or remedy
      under any existing material contract which relate to (1) any distribution
      arrangements, (2) any Proprietary Asset which is material to any of their
      respective businesses, (3) the license of any Proprietary Asset by or to
      any Person on an exclusive basis or (4) a third party’s ability to consent
      to any the transactions contemplated by this Agreement, or (B) any
      material contract not otherwise described above other than in the ordinary
      course of business and consistent with past practice;

	 	 	 
	 	(iv) 	
      acquire, lease or license any right or other asset from
      any other Person or sell or otherwise dispose of, or lease or license, any
      right or other asset to any other Person (except in each case for
      immaterial assets acquired, leased, licensed or disposed of in the
      ordinary course of business and consistent with past practices), or waive
      or relinquish any material right;

	 	 	 
	 	(v) 	
      make any material Tax election;

	 	 	 
	 	(vi) 	
      commence any Legal Proceeding (other than (A) for the
      routine collection of amounts owing or (B) in respect of a breach of this
      Agreement) or settle any Legal Proceeding;

	 	 	 
	 	(vii) 	
      enter into any material transaction or take any other
      material action outside the ordinary course of business or inconsistent
      with past practices; or

	 	 	 
	 	(viii) 	
      agree or commit to take any of the foregoing
    actions.

	 	(c) 	
      During the Pre-Closing Period, each of Parent and the
      Company (the “Notifying Party”) shall promptly notify the other party in
      writing of: (i) the discovery by the Notifying Party of any event,
      condition, fact or circumstance that occurred or existed on or prior to
      the date of this Agreement and that caused or constitutes a material
      inaccuracy in any representation or warranty made by the Notifying Party
      in this Agreement; (ii) any event, condition, fact or circumstance that
      occurs, arises or exists after the date of this Agreement and that would
      cause or constitute a material inaccuracy in any representation or
      warranty made by the Notifying Party in this Agreement if (A) such
      representation or warranty had been made as of the time of the occurrence,
      existence or discovery of such event, condition, fact or circumstance, or
      (B) such event, condition, fact or circumstance had occurred, arisen or
      existed on or prior to the date of this Agreement; (iii) any material
      breach of any covenant or obligation of the Notifying Party; (iv) where
      the Company is the Notifying Party, any event, condition, fact or
      circumstance, either individually or in the aggregate, that would make the
      timely satisfaction by the Company of any of the conditions set forth in
      Section 6 impossible or unlikely or that has had or could reasonably be
      expected to have a Material Adverse Effect on the Acquired Corporations;
      and (v) where Parent is the Notifying Party, any event, condition, fact or
      circumstance, either individually or in the aggregate, that would make the
      timely satisfaction by Parent of any of the conditions set forth in
      Section 7 impossible or unlikely or that has had or could reasonably be
      expected to have a Material Adverse Effect on Parent. Without limiting the
      generality of the foregoing, each of Parent and the Company, as the case
      may be shall promptly advise the other party in writing of any Legal
      Proceeding or material claim threatened, commenced or asserted against or
      with respect to Parent, on the one hand, and the Company or any of the
      Acquired Corporations, on the other hand. No notification given to Parent
      or the Company pursuant to this Section 4.2(c) shall limit or otherwise
      affect any of the representations, warranties, covenants or obligations of
      the other party contained in this Agreement.

8 

	 	(d) 	
      During the Pre-Closing Period, neither the Company nor
      Parent shall and shall not permit any of their respective subsidiaries to,
      except as contemplated herein or with the prior written consent of the
      other:

	 	 	 	 
	 		(i) 	
      sell, issue, grant or authorize the issuance or grant of
      (A) any shares or other capital stock or other security, (B) any option,
      call, warrant or right to acquire any shares or other capital stock or
      other security or (C) any instrument convertible into or exchangeable for
      any shares or other capital stock or other security, except the issuance
      of shares upon the valid exercise of any stock options outstanding as of
      the date of this Agreement; or

	 	 	 	 
	 		(ii) 	
      establish, adopt or amend any employee benefit plan, pay
      any bonus or make any profit-sharing or similar payment to, or increase
      the amount of the wages, salary, commissions, fringe benefits or other
      compensation or remuneration payable to, any of its directors, officers or
      employees (except (A) routine, reasonable salary increases in connection
      with customary employee review process that do not in aggregate exceed
      $25,000 per year, and (B) may pay customary bonus payments and profit
      sharing payments consistent with past practices payable in accordance with
      existing bonus and profit sharing plans that do not in the aggregate
      exceed $50,000).

	4.3 	
      No Solicitation.

	 	 	 
		(a) 	
      Each of the Company and Parent, as the case may be, shall
      not directly or indirectly, and shall not authorize or permit any of their
      respective subsidiaries or any Representative directly or indirectly to,
      (i) solicit, initiate, encourage, induce or facilitate the making,
      submission or announcement of any Acquisition Proposal, (ii) furnish any
      information to any Person in connection with or in response to an
      Acquisition Proposal, (iii) engage in discussions or negotiations with any
      Person with respect to any Acquisition Proposal, (iv) approve, endorse or
      recommend any Acquisition Proposal or (v) enter into any letter of intent
      or similar document or any Contract contemplating or otherwise relating to
      any Acquisition Transaction; provided, however, that prior to the
      approval the Arrangement by the Required Company Securityholder Vote, this
      Section 4.3(a) shall not prohibit either party from entering into a
      confidentiality agreement containing customary limitations on the use and
      disclosure of all nonpublic written and oral information furnished to such
      Person by or on behalf of the Company or Parent, as the case may be, and
      containing customary “standstill” provisions (a “Standard Confidentiality
      Agreement”), furnishing information to, or entering into discussions or
      negotiations with, any Person in response to an unsolicited written bona
      fide Offer that is reasonably likely to lead to a Superior Offer that is
      submitted to the Company or Parent, as the case may be, by such Person
      (and not withdrawn) or endorsing or recommending a Superior Offer if (1)
      neither the Company, Parent nor any of their respective Representatives
      shall have breached or taken any action inconsistent with any of the
      provisions set forth in this Section 4.3 in a manner that directly or
      indirectly has led or contributed to the submission of such Offer, (2) the
      board of directors of the Company concludes in good faith, after
      considering the written advice of its outside legal counsel or Parent, as
      the case may be, that such action is required in order for the board of
      directors to comply with its fiduciary obligations under applicable law,
      (3) at least two business days prior to furnishing any such nonpublic
      information to, or entering into discussions with, such Person, the
      Company or Parent, as the case may be, gives to the other party hereto
      written notice of the identity of such Person and of the Company’s or
      Parent’s, as the case may be, intention to furnish nonpublic information
      to, or enter into discussions with, such Person, and acknowledging the
      receipt from such Person of an executed Standard Confidentiality
      Agreement, and (4) at the same time as it furnishes any nonpublic
      information to such

9 

	 		
      Person, furnishes such information to the other party
      hereto (to the extent such nonpublic information has not been previously
      furnished). The parties agree that for purposes of the preceding sentence
      (but for no other purpose), an Offer which is conditioned upon completion
      of due diligence shall be deemed to constitute a “Superior Offer” if such
      Offer otherwise meets the definition of “Superior Offer”. Without limiting
      the generality of the foregoing, the Company and Parent acknowledge and
      agree that any action inconsistent with any of the provisions set forth in
      the preceding sentence by any Representative, whether or not such
      Representative is purporting to so act shall be deemed to constitute a
      breach of this Section 4.3 by the Company or Parent, as the case may
      be.

	 	 	 
	 	(b) 	
      The Company or Parent, as the case may be, shall promptly
      (and in no event later than 24 hours after receipt of any Acquisition
      Proposal, any inquiry or indication of interest that could lead to an
      Acquisition Proposal or any request for nonpublic information in
      connection with an Acquisition Proposal) advise the other party orally and
      in writing of any Acquisition Proposal or any request for nonpublic
      information in connection with an Acquisition Proposal (including the
      identity of the Person making or submitting such Acquisition Proposal and
      the terms thereof) that is made or submitted by any Person during the
      Pre-Closing Period. The Company or Parent, as the case may be, shall keep
      the other party fully informed with respect to the status of any such
      Acquisition Proposal, inquiry, indication of interest or request and any
      modification or proposed modification thereto.

	 	 	 
	 	(c) 	
      The Company and Parent shall immediately cease and cause
      to be terminated any existing discussions with any Person that relate to
      any Acquisition Proposal. The Company or the Parent, as the case may be,
      will promptly request each Person that has executed a confidentiality
      agreement in connection with its consideration of a possible Acquisition
      Transaction or equity investment to return all confidential information
      heretofore furnished to such Person.

	 	 	 
	 	(d) 	
      The Company or Parent, as the case may be, shall not
      enter into any agreement, commitment or understanding with respect to any
      Acquisition Proposal unless (i) their respective boards of directors has
      determined that such Acquisition Proposal is a Superior Proposal, (ii)
      provided to the other party hereto with copies of such agreements proposed
      to be entered into in connection therewith; and (iii) unless waived by the
      other party hereto, a period of five business days has lapsed from the
      date of providing such information and, during which time, the parties
      have attempted in good faith to negotiate such amendments or changes to
      the transactions contemplated herein such that the Acquisition Proposal no
      longer constitutes a Superior Proposal, failing which the party may enter
      into such agreements to effect such Superior Proposal.

	 	 	 
	 	(e) 	
      Unless the Company, or Parent, as the case may be, has
      determined that an Acquisition Proposal is a Superior Proposal and has
      otherwise complied with the terms of this Section 4.3, the Company and
      Parent, as the case may be, agrees not to release or permit the release of
      any Person from, or to waive or permit the waiver of any provision of, any
      confidentiality, “standstill” or similar agreement to which any of them
      are a party or under which any of them have any rights, and will use their
      best efforts to enforce or cause to be enforced each such agreement at the
      request of the other party.

10 

	5. 	
      ADDITIONAL COVENANTS OF THE PARTIES

	 	 	 
	5.1 	
      Securityholders’ Meetings.

	 	 	 
		(a) 	
      The Company shall take all action necessary under all
      applicable Legal Requirements to call, give notice of and hold a meeting
      of all Company Securityholders to vote on the approval of the Arrangement
      (the “Company Securityholders’ Meeting”). The Company Securityholders’
      Meeting shall be held (on a date selected by the Company in consultation
      with Parent) as promptly as practicable after the date of this Agreement.
      The Company shall ensure that all proxies solicited in connection with the
      Company Securityholders’ Meeting are solicited in compliance with all
      applicable Legal Requirements.

	 	 	 
		(b) 	
      The Management Proxy Circular shall include a statement
      to the effect that the board of directors of the Company unanimously
      recommends that the Company Securityholders vote to approve the
      Arrangement at the Company Securityholders’ Meeting (the unanimous
      recommendation of the Company’s board of directors that the Company
      Securityholders vote to approve the Arrangement being referred to as the
      “Company Board Recommendation”).

	 	 	 
		(c) 	
      Notwithstanding Section 5.1(b), at any time prior to the
      approval of this Agreement by the Required Company Securityholder Vote,
      the Company Board Recommendation may be withdrawn or modified in a manner
      adverse to Parent.

	 	 	 
		(d) 	
      Parent shall take all action necessary under all
      applicable Legal Requirements to call, give notice of and hold a meeting
      of all holders of common stock of Parent to vote on the approval of or to
      obtain consent in writing to the amendment of the certificate of
      incorporation of Parent to permit the creation of the Special Voting
      Shares as promptly as practical after the date of this Agreement. Parent
      shall ensure that all proxies solicited, if any, or written consents
      obtained in connection with such amendment are solicited in compliance
      with all applicable Legal Requirements.

	 	 	 
	5.2 	
      Regulatory Approvals

     Each party shall use all
reasonable efforts to file, as soon as practicable after the date of this
Agreement, all notices, reports and other documents required to be filed by such
party with any Governmental Body with respect to the Arrangement and the other
transactions contemplated by this Agreement, and to submit promptly any
additional information requested by any such Governmental Body. Without limiting
the generality of the foregoing, the Company and Parent shall, promptly after
the date of this Agreement, prepare and file the notifications required under
applicable foreign antitrust laws or regulations in connection with the
Arrangement, if applicable. The Company and Parent shall respond as promptly as
practicable to any inquiries or requests received in connection therewith. Each
of the Company and Parent shall (1) give the other party prompt notice of the
commencement or threat of commencement of any Legal Proceeding by or before any
Governmental Body with respect to the Arrangement or any of the other
transactions contemplated by this Agreement, (2) keep the other party informed
as to the status of any such Legal Proceeding or threat, and (3) promptly inform
the other party of any communication to or from any Governmental Body regarding
the Arrangement. Except as may be prohibited by any Governmental Body or by any
Legal Requirement, (a) the Company and Parent will consult and cooperate with
one another, and will consider in good faith the views of one another, in
connection with any analysis, appearance, presentation, memorandum, brief,
argument, opinion or proposal made or submitted in connection with any Legal
Proceeding under or relating to the Arrangement, and (b) in connection with any
such Legal Proceeding, each of the Company and Parent will permit authorized
Representatives of the other party to be present at each meeting or conference
relating to any such Legal Proceeding and to have access to and be consulted in
connection with any 

11 

document, opinion or proposal made or submitted to any
Governmental Body in connection with any such Legal Proceeding.

	5.3 	
      Company Options

	 	 	 
		(a) 	
      Subject to Section 5.3(b), at the Effective Time (but
      following sequentially after Parent has acquired sufficient Common Shares
      so as to control the Company), each Company Option which is outstanding
      and unexercised immediately prior to the Effective Time, whether or not
      vested, shall be exchanged for an option (a “Replacement Option”) to
      purchase that number of shares of Parent Common Stock equal to the number
      of Common Shares subject to such Company Option immediately prior to the
      Effective Time multiplied by the Exchange Ratio, rounding down to the
      nearest whole share, the per share exercise price under each such
      Replacement Option shall be $0.40 (regardless of the exercise price
      previously applicable to that Company Option), Parent shall be deemed to
      have assumed and adopted the Company’s obligations under each such Company
      Option and any document or agreement previously evidencing a Company
      Option will thereafter evidence and be deemed to evidence such Replacement
      Option. Any restriction on the exercise of any such option shall continue
      in full force and effect and the term, exercisability, vesting schedule
      and other provisions of such option shall otherwise remain unchanged;
      provided, however, that each Replacement Option assumed by Parent in
      accordance with this Section 5.3(a) shall, in accordance with its terms,
      be subject to further adjustment as appropriate to reflect any stock
      split, division or subdivision of shares, stock dividend, reverse stock
      split, consolidation of shares, reclassification, recapitalization or
      other similar transaction affecting the shares of Parent Common Stock
      subsequent to the Effective Time.

	 	 	 
		(b) 	
      Notwithstanding anything to the contrary contained in
      this Section 5.3, in lieu of assuming outstanding Company Options in
      accordance with Section 5.3(a), Parent may, at its election, cause such
      outstanding Company Options to be cancelled upon the issuance by Parent of
      substantially equivalent replacement stock options in substitution
      therefor; provided that the term, exercisability, vesting schedule and
      other provisions of such replacement options shall be equivalent to the
      Company Options.

	 	 	 
		(c) 	
      As soon as commercially reasonable after the Effective
      Date, Parent shall file with the SEC a registration statement on Form S-8
      relating to the shares of Parent Common Stock issuable with respect to the
      Replacement Options assumed by Parent in accordance with this Section
      5.3(a) or issued under 5.3(c).

	 	 	 
		(d) 	
      Prior to the Effective Time, the Company shall use its
      reasonable best efforts to take all action that may be necessary (under
      the plans pursuant to which Company Options are outstanding and otherwise)
      to effectuate the provisions of this Section 5.3 and to ensure that, from
      and after the Effective Time, holders of Company Options have no rights
      with respect thereto other than those specifically provided in this
      Section 5.3.

	 	 	 
	5.4 	
      Indemnification of Officers and
  Directors.

	 	 	 
		(a) 	
      All rights to indemnification existing in favor of those
      Persons who are directors and officers of any Acquired Corporation as of
      the date of this Agreement (the “Indemnified Persons”) for their acts and
      omissions occurring prior to the Effective Time, as provided in the
      indemnification agreements between the Company and said Indemnified
      Persons (as in effect as of the date of this Agreement) in the forms
      disclosed by the Company to Parent prior to the date of this Agreement
      shall survive the Arrangement and shall be the obligation of the Company
      and Parent for a period of six years from the Effective
  Time.

12 

		(b) 	
      From the Effective Time until the sixth anniversary of
      the Effective Time, Parent or the Company shall maintain in effect, or
      procure run-off coverage for the benefit of the Indemnified Persons with
      respect to their acts and omissions occurring prior to the Effective Time,
      under any existing policy of directors’ and officers’ liability insurance
      maintained by the Company as of the date of this Agreement or include the
      Indemnified Persons under any such policy in place by Parent (the
      “Existing Policy”), to the extent that directors’ and officers’ liability
      insurance coverage is commercially available and with a reasonable premium
      therefore; provided, however, that Parent or the Company, as the
      case may be, may substitute for the Existing Policy a policy or policies
      of comparable coverage.

	 	 	 
	5.5 	
      Additional Agreements

	 	 	 
		(a) 	
      Subject to Section 5.5(b), Parent and the Company shall
      use all reasonable efforts to take, or cause to be taken, all actions
      necessary to consummate the Arrangement and make effective the other
      transactions contemplated by this Agreement. Without limiting the
      generality of the foregoing, but subject to Section 5.5(b), each party to
      this Agreement (i) shall make all filings (if any) and give all notices
      (if any) required to be made and given by such party in connection with
      the Arrangement and the other transactions contemplated by this Agreement,
      (ii) shall use all reasonable efforts to obtain each Consent (if any)
      required to be obtained (pursuant to any applicable Legal Requirement or
      Contract, or otherwise) by such party in connection with the Arrangement
      or any of the other transactions contemplated by this Agreement, and (iii)
      shall use all reasonable efforts to lift any restraint, injunction or
      other legal bar to the Arrangement. Each of Parent and the Company shall
      promptly deliver to the other party a copy of each such filing made, each
      such notice given and each such Consent obtained by it during the Pre-
      Closing Period.

	 	 	 
		(b) 	
      Notwithstanding anything to the contrary contained in
      this Agreement, Parent shall not have any obligation under this Agreement:
      (i) to dispose of or transfer or cause any of its Subsidiaries to dispose
      of or transfer any assets, or to commit to cause any of the Acquired
      Corporations to dispose of any assets; (ii) to discontinue or cause any of
      its Subsidiaries to discontinue offering any product or service, or to
      commit to cause any of the Acquired Corporations to discontinue offering
      any product or service; (iii) to license or otherwise make available, or
      cause any of its Subsidiaries to license or otherwise make available, to
      any Person, any technology, software or other Proprietary Asset, or to
      commit to cause any of the Acquired Corporations to license or otherwise
      make available to any Person any technology, software or other Proprietary
      Asset; (iv) to hold separate or cause any of its Subsidiaries to hold
      separate any assets or operations (either before or after the Closing
      Date), or to commit to cause any of the Acquired Corporations to hold
      separate any assets or operations; (v) to make or cause any of its
      Subsidiaries to make any commitment (to any Governmental Body or
      otherwise) regarding its future operations or the future operations of any
      of the Acquired Corporations; or (vi) to contest any Legal Proceeding
      relating to the Arrangement if Parent determines in good faith that
      contesting such Legal Proceeding might not be advisable.

	 	 	 
	5.6 	
      Board of Directors

     On Closing, Parent and Company will
have taken all necessary steps to ensure that their respective boards of
directors consists of the following individuals: 

13 

	                   
      Terry Matthews, Chairman; 
	                   
      Chris Cooper; 
	                   
      Larry Timlick; 
	                   
      Owen Matthews, Vice Chairman; 
	                   
      Mark Bruk, Vice Chairman; 
	                   
      Greg Pelling; and 
	                   
      Donovan Jones. 

	5.7 	Officers 

     On Closing, Parent will have taken all
commercially reasonable steps to ensure that its officers consists of the
following individuals: 

	 	Greg Pelling as Chief Executive Officer; 
	 	Donovan Jones as President and Chief Operating
      Officer; 
	 	Jason Fischl as Chief Technology Officer;

	 	David Karp as Chief Financial Officer; and
  
	 	Andrew Fisher as Executive Vice President
      Business Development. 

	5.8 	Financing 

      On or before Closing, Parent
will complete an equity financing (other than pursuant to the Wesley Clover
Subscription Agreement) of not less than $1,000,000, up to a maximum of
$2,000,000, at a price of $0.40 per share of Parent Common Stock. 

	6. 	CONDITIONS PRECEDENT TO OBLIGATIONS OF
      PARENT AND EXCHANGECO 

     The obligations of Parent and
ExchangeCo to effect the Arrangement and otherwise consummate the transactions
contemplated by this Agreement are subject to the satisfaction, at or prior to
the Closing, of each of the following conditions (it being understood that as of
the Effective Time, all conditions herein shall be deemed to be satisfied and
any liability for failure to satisfy any condition herein shall be precluded):

	6.1 	Accuracy of Representations
  

     The representations and
warranties of the Company contained in Schedule B of this Agreement shall be
accurate in all respects as of the date of this Agreement and as of the Closing
Date as if made on and as of the Closing Date (except (i) for such
representations and warranties which address matters only as of a particular
time, which shall have been accurate in all respects as of such particular time
and (ii) as such representations and warranties may be affected by transactions
expressly required pursuant to this Agreement or pursuant to the written consent
of Parent), except that any inaccuracies in such representations and warranties
will be disregarded if the circumstances giving rise to all such inaccuracies
(considered collectively) do not constitute, and would not reasonably be
expected to have, a Material Adverse Effect on the Acquired Corporations;
provided, however, that, for purposes of determining the accuracy of such
representations and warranties, (i) all “Material Adverse Effect” qualifications
and other materiality qualifications contained in such representations and
warranties shall be disregarded and (ii) any update of or modification to the
Company Disclosure Schedule made or purported to have been made after the date
of this Agreement shall be disregarded. 

	6.2 	Performance of Covenants

     Each covenant or obligation that
the Company is required to comply with or to perform at or prior to the Closing
shall have been complied with and performed in all material respects. 

14 

	6.3 	Securityholder Approval; Exercise of Dissent
      Rights 

	 	(a) 	
      The Arrangement shall have been duly approved by the
      Required Company Securityholder Vote and holders of not more than 5% of
      the Common Shares issued and outstanding immediately prior to the
      Effective Time (which issued and outstanding Common Shares shall include
      Common Shares issuable pursuant to stock options, warrants or any other
      security of the Company that is granted and outstanding, if, pursuant to
      any Legal Requirement, including the Interim Order, any securityholder of
      the Company other than the holders of Common Shares is entitled to
      exercise Dissent Rights with respect to such options, warrants or other
      securities) shall have exercised their Dissent Rights (and not withdrawn
      such exercise) in connection with the Arrangement.

	 	 	 
	 	(b) 	
      The Arrangement shall have been duly approved by the
      Required Company Securityholder Vote in accordance with any conditions in
      addition to those set forth in Section 6.3(a) which may be imposed by the
      Interim Order and which are satisfactory to Parent, acting
    reasonably.

	6.4 	Consents 

     The Consents or approvals which
Parent has identified and advised the Company in writing as being necessary in
connection with the completion of the Arrangement shall have been obtained on
terms acceptable to Parent, acting reasonably, and shall be in full force and
effect. 

	6.5 	Agreements and Documents

     Parent shall have received the
following agreements and documents, each of which shall be in full force and
effect: 

	 	(a) 	
      Plan of Arrangement;

	 	 	 
	 	(b) 	
      Exchangeable Share Support Agreement;

	 	 	 
	 	(c) 	
      Voting and Exchange Trust Agreement;

	 	 	 
	 	(d) 	
      Wesley Clover Subscription Agreement (including the
      Escrow Agreement referred to therein);

	 	 	 
	 	(e) 	
      a certificate executed on behalf of the Company by its
      Chief Executive Officer and Chief Financial Officer confirming that the
      conditions set forth in Section 7 have been waived or duly satisfied;
      and

	 	 	 
	 	(f) 	
      the written resignations of such of the officers and
      directors and resolutions of each of the Acquired Corporations, effective
      as of the Effective Time as contemplated
herein.

	6.6 	No Material Adverse Change

     Since the date of this Agreement,
there shall not have occurred any change, effect, event or circumstance that, in
combination with any other changes, effects, events or circumstances, has
resulted in or would reasonably be expected to result in a Material Adverse
Change on the Acquired Corporations. 

15 

	6.7 	Court Orders 

     The Interim Order and the Final
Order shall each have been obtained in a form and on terms reasonably
satisfactory to Parent and shall not have been set aside or modified (on appeal
or otherwise) in a manner unacceptable to Parent (acting reasonably). 

	6.8 	No Restraints 

     No temporary restraining order,
preliminary or permanent injunction or other order preventing the consummation
of the Arrangement shall have been issued by any court of competent jurisdiction
and remain in effect, and there shall not be any Legal Requirement enacted or
deemed applicable to the Arrangement that makes consummation of the Arrangement
illegal. 

	6.9 	No Governmental or Other Litigation
  

     There shall not be pending or
threatened any Legal Proceeding which would reasonably be expected to have a
Material Adverse Effect on the Acquired Corporations or a Material Adverse
Effect on Parent: (a) challenging or seeking to restrain or prohibit the
consummation of the Arrangement or any of the other transactions contemplated by
this Agreement; (b) relating to the Arrangement and seeking to obtain from
Parent or any of the Acquired Corporations, any damages or other relief that may
be material to Parent or the Acquired Corporations; (c) seeking to prohibit or
limit in any material respect Parent’s or ExchangeCo’s ability to vote, receive
dividends with respect to or otherwise exercise ownership rights with respect to
the stock of any of the Acquired Corporations; (d) that could materially and
adversely affect the right of Parent or any of the Acquired Corporations to own
the assets or operate the business of the Acquired Corporations; or (e) seeking
to compel any of the Acquired Corporations, Parent or any Subsidiary of Parent
to dispose of or hold separate any material assets as a result of the
Arrangement or any of the other transactions contemplated by this Agreement.

	6.10 	Compliance with Section 3(a)(10) of the
      Securities Act 

     All applicable requirements of
Section 3(a)(10) of the U.S. Securities Act shall have been satisfied with
respect to the issuance of Parent Common Stock and Exchangeable Shares pursuant
to the Arrangement. 

	6.11 	Liabilities and Working Capital
  

     At the Effective Time, the total
liabilities of the Acquired Corporations shall not exceed $300,000, the Company
will have cash or cash equivalents of not less than $2.5 million and the Company
will have working capital, defined as current assets less current liabilities,
of not less than $2.7 million. 

	6.12 	Employment Arrangements

     On or before the Effective Time, the
Company shall have made satisfactory arrangements to hire all hourly and
salaried staff necessary to operate the business of the Company, including the
Company and/or Parent entering into an executive management agreement with each
of Greg Pelling, Andrew Fisher, Cec Primeau, Mark Bruk and Owen Matthews. 

	6.13 	Bell Canada Debt 

     On or before the Effective Time, the
debt in the principal amount of Cdn$2.0 million and accrued interest owed by the
Company to Bell Canada will either be converted into Company Common Shares or
repaid. 

16 

	6.14 	Wesley Clover Debt 

      On or before the Effective Time,
all debts and accrued interest owing by the Company to Wesley Clover shall be
converted into Company Common Shares. 

	7. 	CONDITIONS PRECEDENT TO OBLIGATION OF THE
      COMPANY 

     The obligation of the Company to
effect the Arrangement and otherwise consummate the transactions contemplated by
this Agreement are subject to the satisfaction, at or prior to the Closing, of
the following conditions (it being understood that as of the Effective Time, all
conditions herein shall be deemed to be satisfied and any liability for failure
to satisfy any condition herein shall be precluded): 

	7.1 	Accuracy of Representations
  

     The representations and
warranties of Parent and ExchangeCo contained in Schedule C of this Agreement
shall be accurate in all respects as of the date of this Agreement and as of the
Closing Date as if made on and as of the Closing Date (except (i) for such
representations and warranties which address matters only as of a particular
time, which shall have been accurate in all respects as of such particular time
and (ii) as such representations and warranties may be affected by transactions
expressly required pursuant to this Agreement or pursuant to the written consent
of the Company), except that any inaccuracies in such representations and
warranties will be disregarded if the circumstances giving rise to all such
inaccuracies (considered collectively) do not constitute, and would not
reasonably be expected to have, a Material Adverse Effect on Parent;
provided, however, that, for purposes of determining the accuracy of such
representations and warranties, all “Material Adverse Effect” qualifications and
other materiality qualifications contained in such representations and
warranties shall be disregarded. 

	7.2 	Performance of Covenants

     All of the covenants and
obligations that Parent and ExchangeCo are required to comply with or to perform
at or prior to the Closing shall have been complied with and performed in all
material respects. 

	7.3 	
      Securityholder Approval

	 	 	 
		(a) 	
      The Arrangement shall have been duly approved by the
      Required Company Securityholder Vote.

	 	 	 
		(b) 	
      The Arrangement shall have been duly approved by the
      Required Company Securityholder Vote in accordance with any conditions in
      addition to those set forth in Section 7.3(a) which may be imposed by the
      Interim Order and which are satisfactory to the Company, acting
      reasonably.

	 	 	 
	7.4 	
      Consents

     The Consents or approvals which
the Company has identified and advised the Parent in writing as being necessary
in connection with the completion of the Arrangement shall have been obtained on
terms acceptable to the Company, acting reasonably, and shall be in full force
and effect. 

	7.5 	Agreements and Documents

     The Company shall have received
the following agreements and document each of which shall be in full force and
effect: 

	 	(a) 	
      Plan of Arrangement;

17 

	 	(b) 	
      Exchangeable Share Support Agreement;

	 	 	 
	 	(c) 	
      Registration Rights Agreement;

	 	 	 
	 	(d) 	
      Voting and Exchange Trust Agreement;

	 	 	 
	 	(e) 	
      a certificate executed on behalf of Parent by its Chief
      Executive Officer and Chief Financial Officer, confirming that the
      conditions set forth in Sections 6 have been waived or duly satisfied;
      and

	 	 	 
	 	(f) 	
      the written resignations of such of the officers and
      directors and resolutions of Parent, effective as of the Effective Time as
      contemplated herein.

	7.6 	No Material Adverse Change

     Since the date of this Agreement,
there shall not have occurred any change, effect, event or circumstance that, in
combination with any other changes, effects, events or circumstances, has
resulted in or would reasonably be expected to result in a Material Adverse
Change on Parent. 

	7.7 	Court Orders 

     The Interim Order and the Final
Order shall each have been obtained in a form and on terms reasonably
satisfactory to the Company and shall not have been set aside or modified (on
appeal or otherwise) in a manner unacceptable to the Company (acting
reasonably). 

	7.8 	No Restraints 

     No temporary restraining order,
preliminary or permanent injunction or other order preventing the consummation
of the Arrangement by the Company shall have been issued by any court of
competent jurisdiction and remain in effect, and there shall not be any Legal
Requirement enacted or deemed applicable to the Arrangement that makes
consummation of the Arrangement by the Company illegal. 

	7.9 	No Governmental or Other Litigation
  

     There shall not be pending or
threatened any Legal Proceeding which would reasonably be expected to have a
Material Adverse Effect on the Acquired Corporations or a Material Adverse
Effect on Parent: (a) challenging or seeking to restrain or prohibit the
consummation of the Arrangement or any of the other transactions contemplated by
this Agreement; (b) relating to the Arrangement and seeking to obtain from
Parent or any of the Acquired Corporations, any damages or other relief that may
be material to Parent or the Acquired Corporations; (c) seeking to prohibit or
limit in any material respect the ability to vote, receive dividends with
respect to or otherwise exercise ownership rights with respect to the stock of
any of Parent or ExchangeCo to be issued under the Arrangement; or (d) seeking
to compel any of the Acquired Corporations, Parent, or any Subsidiary of Parent
to dispose of or hold separate any material assets as a result of the
Arrangement or any of the other transactions contemplated by this Agreement.

	7.10 	Compliance with Section 3(a)(10) of the
      Securities Act 

     All applicable requirements of
Section 3(a)(10) of the U.S. Securities Act shall have been satisfied with
respect to the issuance of Parent Common Stock and Exchangeable Shares pursuant
to the Arrangement. 

18 

	7.11 	
      Cash and Receivables

	 	 	 
		(a) 	
      At the Effective Time, Parent will have a combination of
      cash and accounts receivable of not less than $4.0 million including cash
      raised in accordance with Sections 5.8 and 7.11(b) but not including the
      proceeds to be raised pursuant to the Wesley Clover Subscription
      Agreement.

	 	 	 
		(b) 	
      Parent will have received the subscription and funds from
      KMB Trac Two Holdings Ltd. to purchase $1.0 million worth of Parent Common
      Stock conditional on and to be completed immediately following the
      Closing.

	 	 	 
		(c) 	
      On or before the Effective Time, holders representing not
      less than $3.0 million of Parent’s outstanding convertible debt will, in
      accordance with the terms thereof, be converted to Parent Common
    Stock.

	 	 	 
	8. 	
      TERMINATION

	 	 	 
	8.1 	
      Termination

     This Agreement may be terminated
prior to the Effective Time (whether before or after the approval of the
Arrangement by the Required Company Securityholder Vote): 

	 	(a) 	
      by mutual written consent of Parent and the
    Company;

	 	 	 
	 	(b) 	
      by either Parent or the Company if the Arrangement shall
      not have been consummated by September 30, 2007; provided, however,
      that a party shall not be permitted to terminate this Agreement
      pursuant to this Section 8.1(b) if the failure to consummate the
      Arrangement by such date is attributable to a failure on the part of such
      party to perform any covenant in this Agreement required to be performed
      by such party at or prior to the Effective Time;

	 	 	 
	 	(c) 	
      by either Parent or the Company if a court of competent
      jurisdiction or other Governmental Body shall have issued a final and
      non-appealable order, decree or ruling, or shall have taken any other
      action, having the effect of permanently restraining, enjoining or
      otherwise prohibiting the Arrangement;

	 	 	 
	 	(d) 	
      by either Parent or the Company if (i) the Company
      Securityholders’ Meeting (including any adjournments and postponements
      thereof) shall have been held and completed and the Company
      Securityholders shall have taken a final vote on a proposal to approve the
      Arrangement, and (ii) the Arrangement shall not have been approved at the
      Company Securityholders’ Meeting (and shall not have been approved at any
      adjournment or postponement thereof) by the Required Company
      Securityholder Vote;

	 	 	 
	 	(e) 	
      by either party (at any time prior to the approval of the
      Arrangement by the Required Company Securityholder Vote) if a Triggering
      Event shall have occurred;

	 	 	 
	 	(f) 	
      by Parent if (i) any of the Company’s representations and
      warranties contained in this Agreement shall be inaccurate as of the date
      of this Agreement, or shall have become inaccurate as of a date subsequent
      to the date of this Agreement (as if made on such subsequent date), such
      that the condition set forth in Section 6.1 would not be satisfied if
      tested as of the date of such inaccuracy or (ii) any of the Company’s
      covenants contained in this Agreement shall have been breached such that
      the condition set forth in Section 6.2 would not be satisfied if tested as
      of the date of such breach; provided, however, that if an
      inaccuracy in any of the Company’s representations and warranties as of a
      date

19 

	 		
      subsequent to the date of this Agreement or a breach of a
      covenant by the Company is curable by the Company and the Company is
      continuing to exercise all reasonable efforts to cure such inaccuracy or
      breach, then Parent may not terminate this Agreement under this Section
      8.1(f) on account of such inaccuracy or breach; or

	 	 	 
	 	(g) 	
      by the Company if (i) any of Parent’s representations and
      warranties contained in this Agreement shall be inaccurate as of the date
      of this Agreement, or shall have become inaccurate as of a date subsequent
      to the date of this Agreement (as if made on such subsequent date), such
      that the condition set forth in Section 7.1 would not be satisfied if
      tested as of the date of such inaccuracy or (ii) if any of Parent’s
      covenants contained in this Agreement shall have been breached such that
      the condition set forth in Section 7.2 would not be satisfied if tested as
      of the date of such breach; provided, however, that if an
      inaccuracy in any of Parent’s representations and warranties as of a date
      subsequent to the date of this Agreement or a breach of a covenant by
      Parent is curable by Parent and Parent is continuing to exercise all
      reasonable efforts to cure such inaccuracy or breach, then the Company may
      not terminate this Agreement under this Section 8.1(g) on account of such
      inaccuracy or breach.

	8.2 	Effect of Termination

     In the event of the termination
of this Agreement as provided in Section 8.1, this Agreement shall be of no
further force or effect; provided, however, that (i) this Section 8.2,
Section 8.3 and Section 9 (and the Confidentiality Agreement) shall survive the
termination of this Agreement and shall remain in full force and effect, and
(ii) the termination of this Agreement shall not relieve any party from any
liability for any material breach of any representation, warranty, covenant,
obligation or other provision contained in this Agreement. 

	8.3 	Expenses 

     Except as set forth in this
Section 8.3, all fees and expenses incurred in connection with this Agreement
and the transactions contemplated by this Agreement shall be paid by the party
incurring such expenses, whether or not the Arrangement is consummated. 

	9. 	
      MISCELLANEOUS PROVISIONS

	 	 
	9.1 	
      Amendment

     This Agreement may be amended
with the approval of the respective boards of directors of the Company and
Parent at any time (whether before or after the approval of the Arrangement by
the Company’s shareholders); provided, however, that after any such
approval by the Company’s shareholders, no amendment shall be made which by law
requires further approval of the shareholders of the Company without the further
approval of such shareholders. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto. 

	9.2 	Waiver 

     No failure on the part of any
party to exercise any power, right, privilege or remedy under this Agreement,
and no delay on the part of any party in exercising any power, right, privilege
or remedy under this Agreement, shall operate as a waiver of such power, right,
privilege or remedy; and no single or partial exercise of any such power, right,
privilege or remedy shall preclude any other or further exercise thereof or of
any other power, right, privilege or remedy. No party shall be deemed to have
waived any claim arising out of this Agreement, or any power, right, privilege
or remedy under this Agreement, unless the waiver of such claim, power, right,
privilege or remedy is expressly set forth in a 

20 

written instrument duly executed and delivered on behalf of
such party; and any such waiver shall not be applicable or have any effect
except in the specific instance in which it is given. 

	9.3 	No Survival of Representations and
      Warranties 

     None of the representations and
warranties contained in this Agreement or in any certificate delivered pursuant
to this Agreement shall survive the completion of the Arrangement. 

	9.4 	Entire Agreement; Counterparts
  

     This Agreement and the other
agreements referred to herein constitute the entire agreement and supersede all
prior agreements and understandings, both written and oral, among or between any
of the parties with respect to the subject matter hereof and thereof;
provided, however, that the Confidentiality Agreement shall not be
superseded and shall remain in full force and effect. This Agreement may be
executed in several counterparts, each of which shall be deemed an original and
all of which shall constitute one and the same instrument 

	9.5 	Applicable Law; Jurisdiction
  

     This Agreement shall be governed
by and construed in accordance with the laws of the Province of British Columbia
and the laws of Canada applicable therein (excluding any conflict of laws, rule
or principle which might refer such construction to the laws of another
jurisdiction) and shall be treated in all respects as a British Columbia
contract. The parties hereto irrevocably attorn to the non-exclusive
jurisdiction of the Courts of British Columbia with respect to any matter
arising hereunder or related thereto. 

	9.6 	Assignability 

     This Agreement shall be binding
upon, and shall be enforceable by and inure solely to the benefit of, the
parties hereto and their respective successors and assigns; provided,
however, that neither this Agreement nor any of Parent’s or the Company’s
rights hereunder may be assigned by Parent or the Company without the prior
written consent of the other party, and any attempted assignment of this
Agreement or any of such rights by Parent or the Company, as the case may be,
without such consent shall be void and of no effect. Nothing in this Agreement,
express or implied, is intended to or shall confer upon any Person (other than
the parties hereto) any right, benefit or remedy of any nature whatsoever under
or by reason of this Agreement, except for the provisions of Section 5.4, which
are intended for the benefit of the Indemnified Persons. 

	9.7 	Notices 

     Any notice or other communication
required or permitted to be delivered to any party under this Agreement shall be
in writing and shall be deemed properly delivered, given and received (a) upon
receipt when delivered by hand, or (b) two business days after sent by
registered mail or by courier or express delivery service or by facsimile,
provided that in each case the notice or other communication is sent to the
address or facsimile telephone number set forth beneath the name of such party
below (or to such other address or facsimile telephone number as such party
shall have specified in a written notice given to the other parties hereto):

21 

	 	(a) 	if to Parent or ExchangeCo: 
	 	  	  
	 	  	             
           CounterPath Solutions, Inc. 
	 	  	             
           Suite 300, One Bentall Centre 
	 	  	             
           505 Burrard St 
	 	  	             
           Vancouver, BC V7X 1M3 
	 	  	             
           Canada 
	 	  	             
           Attn: President 
	 	 	                 
       Fax: (604) 320-3399 
	 	  	  
	 	  	with a copy (but not as notice) to: 
	 	  	  
	 	 	                   Clark
      Wilson LLP 
	 	  	             
           Suite 800 - 885 West Georgia Street 
	 	  	             
           Vancouver, BC V6C 3H1 
	 	  	             
           Canada 
	 	 	                 
       Attn: Virgil Z. Hlus 
	 	 	                 
       Fax: (604) 687-6314 
	 	  	  
	 	(b) 	if to the Company: 
	 	  	  
	 	  	             
           NewHeights Software Corporation 
	 	  	             
           1006 Government Street 
	 	  	             
           Victoria, BC V8W 1X7 
	 	  	             
           Attn: Chairman 
	 	 	                 
       Fax: (250) 380-0404 
	 	  	  
	 	  	with a copy (but not as notice) to: 
	 	  	  
	 	  	             
           McCarthy Tetrault LLP 
	 	  	             
           1300 – 777 Dunsmuir Street 
	 	  	             
           Vancouver, BC V7Y 1K2 
	 	  	             
           Attn: Tim McCafferty 
	 	 	                 
       Fax: (604) 643-7900 

	9.8 	Cooperation 

     Each of Parent and the Company
agrees to cooperate fully with the other party and to execute and deliver such
further documents, certificates, agreements and instruments and to take such
other actions as may be reasonably requested by the other party to evidence or
reflect the transactions contemplated by this Agreement and to carry out the
intent and purposes of this Agreement. 

	9.9 	Severability 

     In the event that any provision
of this Agreement, or the application of any such provision to any Person or set
of circumstances, shall be determined to be invalid, unlawful, void or
unenforceable to any extent, the remainder of this Agreement, and the
application of such provision to Persons or circumstances other than those as to
which it is determined to be invalid, unlawful, void or unenforceable, shall not
be impaired or otherwise affected and shall continue to be valid and enforceable
to the fullest extent permitted by law. 

22 

	9.10 	Currency 

     Unless otherwise specified, all
references in this Agreement to sums of money, “dollars” or “$” shall mean
United States dollars. 

	9.11 	Construction. 

	 	(a) 	
      For purposes of this Agreement, whenever the context
      requires: the singular number shall include the plural, and vice versa;
      the masculine gender shall include the feminine and neuter genders; the
      feminine gender shall include the masculine and neuter genders; and the
      neuter gender shall include masculine and feminine genders. 

	 	  	
	 	(b) 	
      The parties hereto agree that any rule of construction to
      the effect that ambiguities are to be resolved against the drafting party
      shall not be applied in the construction or interpretation of this
      Agreement. 

	 	  	
	 	(c) 	
      As used in this Agreement, the words “include” and
      “including,” and variations thereof, shall not be deemed to be terms of
      limitation, but rather shall be deemed to be followed by the words
      “without limitation.” 

	 	  	
	 	(d) 	
      Except as otherwise indicated, all references in this
      Agreement to “Sections,” “Exhibits” and “Schedules” are intended to refer
      to Sections of this Agreement and Exhibits or Schedules to this
      Agreement.

	 	  	
       

	 	(e) 	
      The bold-faced headings contained in this Agreement are
      for convenience of reference only, shall not be deemed to be a part of
      this Agreement and shall not be referred to in connection with the
      construction or interpretation of this Agreement. 

	 	  	
	 	(f) 	
      The following exhibits and schedules are attached to and
      form part of this Agreement: 

	 	 	 
	 	  	   Schedule A – Certain Definitions
    
	 	 	 
	 	  	   Schedule B – Representations and
      Warranties of the Company 
	 	 	 
	 	  	   Schedule C – Representations and
      Warranties of Parent and ExchangeCo 
	 	 	 
	 	  	   Schedule D – Plan of Arrangement
    
	 	 	 
	 	  	   Schedule E – Piggyback
      Registration Rights Agreement 
	 	 	 
	 	  	   Schedule F – Voting and Exchange
      Trust Agreement 
	 	 	 
	 	  	   Schedule G – Exchangeable Share
      Support Agreement 
	 	 	 
	 	  	   Schedule H – Wesley Clover
      Subscription Agreement 

23 

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

COUNTERPATH SOLUTIONS, INC. 

	Per: 	 /s/ Donovan Jones 	
	  	Authorized Signatory 
	 	 
	6789722 CANADA INC. 
	  	  	  
	Per: 	 /s/ Donovan Jones 	
	  	Authorized Signatory 
	 	 
	NEWHEIGHTS SOFTWARE CORPORATION 
	  	  	  
	Per: 	 /s/ Owen Matthews 	
	  	Authorized Signatory

SCHEDULE A 

CERTAIN DEFINITIONS 

For purposes of the Agreement (including this Schedule A): 

     “Acquired Corporation”
shall have the meaning set out in Section 2.1(a) of Schedule B attached to
the Agreement. 

     “Acquired Corporation
Contract” shall mean any Contract: (a) to which any of the Acquired
Corporations is a party; (b) by which any of the Acquired Corporations or any
material asset of any of the Acquired Corporations is or may become bound or
under which any of the Acquired Corporations has, or may become subject to, any
material obligation; or (c) under which any of the Acquired Corporations has or
may acquire any material right or interest. 

     “Acquisition Proposal”
shall mean any offer, proposal, inquiry or indication of interest (other than an
offer, proposal, inquiry or indication of interest made or submitted by Parent)
contemplating or otherwise relating to any Acquisition Transaction. 

     “Acquisition Transaction”
shall mean any transaction or series of transactions, other than the
transactions contemplated by the Agreement, involving: 

(a) (i) any merger, plan of
arrangement, consolidation, amalgamation, share exchange, business combination,
recapitalization, tender offer, exchange offer or other similar transaction
involving any of the Acquired Corporations, (ii) any transaction in which a
Person or “group” (as defined in the Exchange Act and the rules promulgated
thereunder) of Persons directly or indirectly acquires beneficial ownership of
securities representing more than 20% of the outstanding voting securities of
any of the Acquired Corporations on the one hand, or Parent, on the other, or
(iii) any transaction in which any of the Acquired Corporations, on the one
hand, or Parent, on the other issues securities representing more than 20% of
the outstanding voting securities of any of the Acquired Corporations; 

(b) any sale, lease, exchange,
transfer, license, or disposition of any business or businesses or assets that
constitute or account for 20% or more of the consolidated net revenues, net
income or assets of any of the Acquired Corporations, on the one hand, or
Parent, on the other; or 

(c) any liquidation or dissolution of
any of the Acquired Corporations, on the one hand, or Parent, on the other. 

     “Affiliate” of any Person
shall mean any other Person directly or indirectly controlling, controlled by,
or under common control with, that Person. For the purposes of this definition,
“control” (including, with correlative meanings, the terms “controlled by” and
“under common control with”), as applied to any Person, means the possession by
another Person, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that first mentioned Person, whether
through the ownership of voting securities, by contract or otherwise. 

     “Agreement” shall mean the
Arrangement Agreement to which this Schedule A is attached, as it may be amended
from time to time. 

     “Arrangement” shall mean
an arrangement under Section 192 of the CBCA on the terms and subject to the
conditions set out in the Plan of Arrangement, subject to any amendments or
variations 

A-2 

thereto made in accordance with Section 9.1 of the Agreement or
Article 6 of the Plan of Arrangement or made at the direction of the Court in
the Final Order. 

     “Arrangement Resolution”
shall mean the special resolution to be passed by the Company Securityholders at
the Company Securityholders Meeting. 

     “Articles of Arrangement”
shall mean the articles of arrangement of the Company in respect of the
Arrangement required by Section 192 of the CBCA to be sent to the Director after
the Final Order is made. 

     “Audited Balance Sheets”
shall mean the audited consolidated balance sheets of the Company and its
consolidated subsidiaries as of February 28, 2006. 

     “Canadian Securities
Commissions” shall mean the securities commissions or other securities
regulatory authorities of each of the provinces and territories of Canada. 

     “Canadian Securities Laws”
shall mean the securities acts and comparable Legal Requirements of each of the
provinces and territories of Canada. 

     “CBCA” shall mean the
Canada Business Corporations Act as now in effect and as it may be amended from
time to time, including the regulations made thereunder. 

     “Closing Date” shall mean
the date to be designated by Parent and the Company with respect to the
consummation of the transactions contemplated by the Agreement (the
“Closing”), which in any event shall be no later than the fifth business
day after the satisfaction or waiver of the last to be satisfied or waived of
the conditions set forth in Sections 6 and 7 (other than those conditions that
by their nature are to be satisfied at the Closing, but subject to the
satisfaction or waiver of such conditions). 

     “Common Shares” shall mean the
common shares in the capital of the Company. 

     “Company Disclosure
Schedule” shall mean the disclosure schedule that has been prepared by the
Company and delivered by the Company to Parent on the date of the Agreement and
signed by the President of the Company. 

     “Company Securityholders”
shall mean the holders of Common Shares and the holders of Company Options. 

     “Company Securityholders’
Meeting” shall have the meaning ascribed to that term in Section 5.1(a) of
this Agreement. 

     “Confidentiality
Agreement” shall mean the Mutual Non-Disclosure Agreement dated as of
January 15, 2007 between Parent and the Company. 

     “Consent” shall mean any
approval, consent, order, ratification, permission, waiver or authorization
(including any Governmental Authorization). 

     “Contract” shall mean any
written, oral or other agreement, contract, subcontract, lease, instrument,
note, option, warranty, purchase order, license, sublicense, insurance policy,
benefit plan or legally binding commitment or undertaking of any nature. 

     “Court” shall mean the Supreme
Court of British Columbia. 

     “Director” shall mean the
Director appointed pursuant to Section 260 of the CBCA. 

A-3 

     “Dissent Rights” shall
mean the rights of dissent in connection with the Arrangement described in
Section 3.1 of the Plan of Arrangement. 

     “Effective Date” shall
mean the date shown on the certificate of arrangement to be issued by the
Director under the CBCA giving effect to the Arrangement. 

     “Effective Time” has the
meaning ascribed thereto in the Plan of Arrangement. 

     “Election Deadline” shall
mean 5:00 p.m. (EST) on the date which is two business days prior to the date of
the Company Securityholders’ Meeting. 

     “Encumbrance” shall mean
any lien, pledge, hypothecation, charge, mortgage, security interest,
encumbrance, claim, infringement, interference, option, right of first refusal,
preemptive right, community property interest or restriction of any nature
(including any restriction on the voting of any security, any restriction on the
transfer of any security or other asset, any restriction on the receipt of any
income derived from any asset, any restriction on the use of any asset and any
restriction on the possession, exercise or transfer of any other attribute of
ownership of any asset). 

     “Entity” shall mean any
corporation (including any non-profit corporation), general partnership, limited
partnership, limited liability partnership, joint venture, estate, trust,
company (including any company limited by shares, limited liability company or
joint stock company), firm, society or other enterprise, association,
organization or entity. 

     “Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended. 

     “Exchange Ratio” shall
mean that number determined as the fraction, the numerator of which is
40,250,000 and the denominator is the number of Common Shares outstanding as of
the Effective Time. 

     “Exchangeable Share Support
Agreement” shall mean the agreement to be entered into among Parent and
ExchangeCo, substantially in the form of Schedule G attached to the Agreement,
with such changes thereto as the parties to the Agreement, acting reasonably,
may agree. 

     “Exchangeable Shares”
shall mean the exchangeable shares in the capital of ExchangeCo having
substantially the rights, privileges, restrictions and condition set out in
Appendix 1 of the Plan of Arrangement. 

     “Final Order” shall mean
the final order of the Court approving the Arrangement as such order may be
amended at any time prior to the Effective Time or, if appealed, then (unless
such appeal is withdrawn or denied), as affirmed on appeal prior to the
Effective Time. 

     “Governmental
Authorization” shall mean any: (a) permit, license, certificate, franchise,
permission, variance, clearance, registration, qualification or authorization
issued, granted, given or otherwise made available by or under the authority of
any Governmental Body or pursuant to any Legal Requirement; or (b) right under
any Contract with any Governmental Body. 

     “Governmental Body” shall
mean any: (a) nation, state, commonwealth, province, territory, county,
municipality, district or other jurisdiction of any nature; (b) federal, state,
provincial, local, municipal, foreign or other government; or (c) governmental
or quasi-governmental authority of any nature (including any governmental
division, department, agency, commission, instrumentality, official, ministry,
fund, foundation, center, organization, unit, body or Entity and any court or
other tribunal). 

     “Interim Order” means the
interim order of the Court in respect of the Arrangement, as contemplated by
Section 1.3 of the Agreement. 

A-4 

     “Legal Proceeding” shall
mean any action, suit, litigation, arbitration, proceeding (including any civil,
criminal, administrative, investigative or appellate proceeding), hearing,
inquiry, audit, examination or investigation commenced, brought, conducted or
heard by or before, or otherwise involving, any court or other Governmental Body
or any arbitrator or arbitration panel. 

     “Legal Requirement” shall
mean any federal, state, provincial, local, municipal, foreign or other law,
statute, constitution, principle of common law, resolution, ordinance, code,
edict, decree, rule, regulation, ruling or requirement issued, enacted, adopted,
promulgated, implemented or otherwise put into effect by or under the authority
of any Governmental Body. 

     “Management Proxy
Circular” shall mean the notice of the Company Securityholders’ Meeting and
accompanying management proxy circular to be sent to the Company Securityholders
in connection with the Company Securityholders’ Meeting. 

     “Material Adverse Change”
shall mean any change, effect, event or circumstance that is, or would
reasonably be expected to be, material and adverse to (i) the business,
condition, capitalization, operations, financial performance of the Acquired
Corporations or the Parent, as the case may be, taken as a whole, (ii) the
ability of the Company to consummate the Arrangement or any of the other
transactions contemplated by the Agreement or to perform any of its obligations
under the Agreement, (iii) Parent’s or ExchangeCo’s ability to vote, receive
dividends with respect to or otherwise exercise ownership rights with respect to
the shares of the Acquired Corporations, or (iv) the ability of holders of
Exchangeable Shares or Parent Common Stock who were formerly holders of Common
Shares to vote, receive dividends with respect to, sell or dispose of or
otherwise exercise ownership rights with respect to Exchangeable Shares or
Parent Common Stock issued in connection with the Arrangement; provided,
however, that none of the following shall be deemed, in and of itself, to
constitute a Material Adverse Change: (a) a change in the market price or
trading volume of the Common Shares or Parent Common Stock and (b) a reduction
in revenue of the Company as a result of a delay in customer orders that are
demonstrated to have resulted directly from the public announcement of the
Arrangement. 

     An event, violation, inaccuracy,
circumstance or other matter will be deemed to have a “Material Adverse
Effect” if such event, violation, inaccuracy, circumstance or other matter
had or would reasonably be expected to have a material adverse effect on (i) the
business, condition, capitalization, operations, financial performance of the
Acquired Corporations or the Parent, as the case may be, taken as a whole, (ii)
the ability of the Company to consummate the Arrangement or any of the other
transactions contemplated by the Agreement or to perform any of its obligations
under the Agreement, or (iii) Parent’s or ExchangeCo’s ability to vote, receive
dividends with respect to or otherwise exercise ownership rights with respect to
the shares of the Acquired Corporations (the ability of holders of Exchangeable
Shares or parent Common Stock who were formerly holders of Common Shares to
vote, receive dividends with respect to, sell or dispose of or otherwise
exercise ownership rights with respect to Exchangeable Shares or Parent Common
Stock issued in connection with the Arrangement); provided, however, that
none of the following shall be deemed, in and of itself, to constitute a
Material Adverse Effect: (a) a change in the market price or trading volume of
the Common Shares or Parent Common Stock; (b) a reduction in revenue of the
Company or Parent, as the case may be, as a result of a delay in customer orders
that are demonstrated to have resulted directly from the public announcement of
the Arrangement; and (c) changes in the industry or market generally affecting
the industry in which a party operates or changes in general economic
conditions. 

     “Offer” shall mean an
offer to acquire directly or indirectly 100% of the outstanding Common Shares of
the Company or all or substantially all of its assets pursuant to a merger, plan
of arrangement, consolidation, amalgamation, share exchange, business
combination, tender offer, exchange offer, asset sale or other similar
transaction. 

     “Parent Audited Balance Sheet”
shall mean the audited balance sheet of the Parent as of April 30, 2006.

A-5 

     “Parent Unaudited Balance
Sheet” shall mean the unaudited balance sheet of the Parent as of January
31, 2007. 

     “Parent Common Stock” shall
mean the Common Stock, $0.001 par value per share, of Parent. 

     “Parent Disclosure
Schedule” shall mean the disclosure schedule that has been prepared by
Parent and delivered by Parent to the Company on the date of the Agreement and
signed by the President of Parent. 

     “Parent SEC Documents”
shall mean each report, registration statement and definitive proxy statement
filed by Parent with the SEC since December 30, 2004. 

     “Person” shall mean any
individual, Entity or Governmental Body. 

     “Plan of Arrangement”
shall mean the plan of arrangement substantially in the form of Schedule D
attached to the Agreement and any amendments or variations thereto made in
accordance with Section 9.1 of the Agreement or Article 6 of the Plan of
Arrangement or made at the direction of the Court in the Final Order. 

     “Proprietary Asset” shall
mean any: (a) patent, patent application, trademark (whether registered or
unregistered), trademark application, trade name, fictitious business name,
service mark (whether registered or unregistered), service mark application,
copyright (whether registered or unregistered), copyright application,
application, trade secret, know-how, customer list, franchise, system, computer
software, computer program, model, formula, compound, invention, design,
blueprint, engineering drawing, proprietary product, technology, proprietary
right or other intellectual property right or intangible asset; or (b) right to
use or exploit any of the foregoing. 

     “Registration Rights
Agreement” shall mean the Piggyback Registration Rights Agreement between
Parent and the holders of Exchangeable Shares, such agreement to be
substantially in the form attached as Schedule E. 

     “Representatives” shall
mean officers, directors, employees, agents, attorneys, accountants, advisors
and representatives. 

     “SEC” shall mean the United
States Securities and Exchange Commission. 

     “Special Voting Share”
shall mean the share of special voting stock of Parent having substantially the
rights, privileges, restrictions and conditions described in the Voting and
Exchange Trust Agreement. 

     An entity shall be deemed to be a
“Subsidiary” of another Person if such Person directly or indirectly
owns, beneficially or of record, (a) an amount of voting securities or other
interests in such Entity that is sufficient to enable such Person to elect at
least a majority of the members of such Entity’s board of directors or other
governing body, or (b) at least 50% of the outstanding equity or financial
interests or such Entity. 

     “Superior Offer” shall
mean an unsolicited, bona fide written Offer made by a third party on terms that
the board of directors of the Company or Parent, as the case may be, determines,
in good faith, considering the written advice of an independent financial
advisor of nationally recognized reputation, to be more favorable to the
Company’s or Parent’s shareholders, as the case may be, shareholders than the
terms of the Arrangement; provided, however, that any such Offer shall
not be deemed to be a “Superior Offer” if any financing required to consummate
the transaction contemplated by such Offer is not committed and is not
reasonably capable of being obtained by such third party. 

A-6 

     “Tax” shall mean any tax
(including any income tax, franchise tax, capital gains tax, gross receipts tax,
value-added tax, surtax, estimated tax, unemployment or employment tax or
insurance premium, national and provincial health insurance tax, Canada Pension
Plan amount, excise tax, goods and services tax (“GST”) ad valorem tax, transfer
tax, stamp tax, sales tax, use tax, property tax, business tax, withholding tax
or payroll tax), levy, assessment, tariff, duty (including any customs duty),
deficiency or fee, and any related charge or amount (including any fine, penalty
or interest), imposed, assessed or collected by or under the authority of any
Governmental Body. 

     “Tax Return” shall mean
any return (including any information return), report, statement, declaration,
estimate, schedule, notice, notification, form, election, certificate or other
document or information filed with or submitted to, or required to be filed with
or submitted to, any Governmental Body in connection with the determination,
assessment, collection or payment of any Tax or in connection with the
administration, implementation or enforcement of or compliance with any Legal
Requirement relating to any Tax. 

     A “Triggering Event” shall
be deemed to have occurred if: (i) the board of directors of the Company shall
have withdrawn or modified in a manner adverse to Parent the Company Board
Recommendation (ii) either party shall have taken any other action which a
reasonable Person would believe indicates that the board of directors of the
Company or the Parent, as the case may be, does not support the Arrangement or
does not believe that the Arrangement is in the best interests of their
respective shareholders; (iii) the board of directors of the Company or the
Parent, as the case may be, shall have approved, endorsed or recommended any
Acquisition Proposal or any letter of intent or similar document or any Contract
providing for any Acquisition Proposal (other than a Standard Confidentiality
Agreement permitted pursuant to and in accordance with the terms of Section
4.3(a); (vi) a tender or exchange offer relating to securities of the Company or
the Parent, as the case may be, shall have been commenced by a Person other than
the other party and the Company or the Parent, as the case may be, sends to its
securityholders a statement disclosing that it recommends such tender or
exchange offer; (vii) an Acquisition Proposal is publicly announced, and the
Company or the Parent, as the case may be, fails to issue a press release
announcing its opposition to such Acquisition Proposal within ten business days
after such Acquisition Proposal is announced or otherwise fails to take all
reasonable steps to oppose such Acquisition Proposal; or (viii) any of the
Acquired Corporations or the Parent, as the case may be, or any Representative
of any of them shall have breached in any material respect or taken any action
inconsistent in any material respect with any of the provisions set forth in
Section 4.3; (vi) a Material Adverse Effect of the Company or the Parent shall
have occurred and the board of directors of the other party shall have concluded
in good faith, after having considered the written advice of its outside legal
counsel, that they must in order to comply with its fiduciary duties or
obligations under applicable law, terminate this Agreement. 

     “Trustee” shall mean
Valiant Trust Company or such other trust company or other Entity that Parent
and the Company choose as trustee under the Voting and Exchange Trust Agreement.

     “Unaudited Balance Sheet”
shall mean the unaudited year end balance sheet of the Company as of February
28, 2007. 

     “U.S. Dollar Equivalent”
shall mean, in respect of an amount expressed in Canadian dollars at any date,
the product obtained by multiplying: (a) the number of Canadian dollars, by (b)
the noon spot exchange rate on such date for Canadian dollars expressed in
United States dollars as reported by the Bank of Canada or, in the event such
spot exchange rate is not available, such spot exchange rate on such date for
Canadian dollars expressed in United States dollars as may be deemed by the
board of directors of the Company and the board of directors of Parent, acting
jointly and reasonably, to be appropriate for such purpose. 

     “U.S. Exchange Act” shall mean
the U.S. Securities Exchange Act of 1934, as amended. 

A-7 

     “U.S. Securities Act” shall
mean the U.S. Securities Act of 1933, as amended. 

     “Voting and Exchange Trust
Agreement” shall mean an agreement to be made among Parent, ExchangeCo and
the Trustee substantially in the form of Schedule F attached to the Agreement,
with such changes thereto as the parties hereto, acting reasonably, may agree.

     “Wesley Clover Subscription
Agreement” shall mean the agreement of Wesley Clover to subscribe for and
purchase from treasury 8,750,000 shares of Parent Common Stock pursuant to and
on the terms and conditions set out in the subscription agreement substantially
in the form attached hereto as Schedule H. 

	SCHEDULE B 
	  
	TO THE ARRANGEMENT AGREEMENT AMONG 
	COUNTERPATH SOLUTIONS, INC, 6789722 CANADA INC. AND

	NEWHEIGHTS SOFTWARE CORPORATION 

	1. 	DEFINITIONS; CURRENCY

     Certain capitalized terms used in this
Schedule B are defined in Schedule A to the Arrangement Agreement dated June 15,
2007, among CounterPath Solutions, Inc., 6789722 Canada Inc. and NewHeights
Software Corporation. Unless otherwise specified, all references to this
Schedule B to sums of money, “dollars” or “$” shall mean United States
Dollars. 

	2. 	REPRESENTATIONS AND WARRANTIES OF THE
      COMPANY 

      The Company represents
and warrants to Parent and ExchangeCo that except as set forth in the Company
Disclosure Schedule prepared in accordance with the Agreement: 

	2.1 	
      Subsidiaries; Due Organization; Etc.

	 	 	 
		(a) 	
      The Company has no Subsidiaries, except for the
      corporations identified in Part 2.1(a)(i) of the Company Disclosure
      Schedule; and neither the Company nor any of the other corporations
      identified in Part 2.1(a)(i) of the Company Disclosure Schedule owns any
      shares in the capital of, or any equity interest of any nature in, any
      other Entity, other than the Entities identified in Part 2.1(a)(ii) of the
      Company Disclosure Schedule. The Company and each of its Subsidiaries are
      referred to collectively in the Agreement as the “Acquired Corporations”.
      None of the Acquired Corporations has agreed or is obligated to make, or
      is bound by any Contract under which it may become obligated to make, any
      future investment in or capital contribution to any other Entity. None of
      the Acquired Corporations has, at any time, been a general partner of, or
      has otherwise been liable for any of the debts or other obligations of,
      any general partnership, limited partnership or other Entity.

	 	 	 
		(b) 	
      Each of the Acquired Corporations is in good standing
      under the laws of the jurisdiction of its incorporation and has all
      necessary power and authority: (i) to conduct its business in the manner
      in which its business is currently being conducted; (ii) to own and use
      its assets in the manner in which its assets are currently owned and used;
      and (iii) to perform its obligations under all Contracts by which it is
      bound.

	 	 	 
		(c) 	
      Each of the Acquired Corporations is qualified to do
      business, and is in good standing, under the laws of all jurisdictions
      where the nature of its business requires such qualification, except where
      the failure to be so qualified would individually or in the aggregate not
      have a Material Adverse Effect on the Acquired Corporations.

	 	 	 
	2.2 	
      Certificate of Incorporation and
  Bylaws

     The Company has delivered or made
available to Parent accurate and complete copies of the certificate of
incorporation, articles, bylaws and other charter and organizational documents
of the Company and each of the Company’s material Subsidiaries identified in
Part 2.1(a)(i) of the Company Disclosure Schedule, including all amendments
thereto. 

B-2 

	2.3 	 Capitalization, Etc.

	 	 	 
		(a) 	 The authorized capital of the Company consists of (i)
        an unlimited number of Common Shares, of which 21,293,300 Common Shares
        have been issued and are outstanding as of the date of the Agreement,
        and (ii) an unlimited number of preferred shares, of which no preferred
        shares are issued or outstanding as of the date of the Agreement. All
        of the outstanding Common Shares have been duly authorized and validly
        issued, and are fully paid and non-assessable. There are no Common Shares
        held by any of the other Acquired Corporations. Other than as set forth
        in Part 2.3(a) of the Company Disclosure Schedule, none of the outstanding
        Common Shares is entitled or subject to any preemptive right, right of
        participation or any similar right; or any right of first refusal in favor
        of the Company; and there is no Acquired Corporation Contract relating
        to the voting or registration of, or restricting any Person from purchasing,
        selling, pledging or otherwise disposing of (or granting any option or
        similar right with respect to), any Common Shares. None of the Acquired
        Corporations is under any obligation, or is bound by any Contract pursuant
        to which it may become obligated, to repurchase, redeem or otherwise acquire
        any outstanding Common Shares.

	 	 	 
		(b) 	 As of the date of the Agreement, 4,247,037 Common Shares
        are subject to issuance pursuant to stock options granted and outstanding
        under the NewHeights Software Corporation Stock Option Plan #3, September
        2004. Purchase rights and options to purchase Common Shares (whether granted
        by the Company pursuant to the Company’s stock plans, assumed by
        the Company in connection with any arrangement, merger, acquisition or
        similar transaction or otherwise issued or granted) are referred to in
        the Agreement as “Company Options”. Part 2.3(b) of the Company
        Disclosure Schedule sets forth the following information with respect
        to each Company Option outstanding as of the date of the Agreement: (i)
        the particular plan (if any) pursuant to which such Company Option was
        granted; (ii) the name of the optionee; (iii) the number of Common Shares
        subject to such Company Option; (iv) the exercise price of such Company
        Option; (v) the date on which such Company Option was granted; (vi) the
        applicable vesting schedule, and the extent to which such Company Option
        is vested and exercisable as of the date of the Agreement; and (vii) the
        date on which such Company Option expires. The Company has delivered to
        Parent accurate and complete copies of all stock option plans pursuant
        to which any of the Acquired Corporations has granted outstanding stock
        options, and the forms of all agreements evidencing such stock options.

	 	 	 
		(c) 	 Except as set in the Company Disclosure Schedule or
        as contemplated herein, there is no outstanding subscription, option,
        call, warrant or right (whether or not currently exercisable) to acquire
        any Common Shares or other shares of the capital stock or other securities
        of any of the Acquired Corporations; (ii) outstanding security, instrument
        or obligation that has the right to vote (other than the Common Shares)
        or that is or may become convertible into or exchangeable for any Common
        Shares or other shares of the capital stock or other securities of any
        of the Acquired Corporations; or (iii) to the Company’s knowledge,
        any condition or circumstance that may give rise to or provide a basis
        for the assertion of a claim by any Person against any of the Acquired
        Corporations to the effect that such Person is entitled to acquire or
        receive any shares of capital stock or other securities of any of the
        Acquired Corporations.

	 	 	 
		(d) 	 All outstanding Common Shares, options, warrants and
        other securities of the Acquired Corporations have been issued and granted
        in compliance with (i) all applicable securities

B-3 

			laws and other applicable Legal Requirements, and (ii)
      all requirements set forth in applicable Contracts.
	 	 	 
		(e) 	
      All of the outstanding shares of capital stock of each of
      the Company’s Subsidiaries have been duly authorized and validly issued,
      are fully paid and nonassessable and free of preemptive rights, with no
      personal liability attaching to the ownership thereof, and are owned
      beneficially and of record by the Company, free and clear of any
      Encumbrances, other than restrictions on transfer contained in the
      articles of incorporation or other similar organizational documents of the
      Subsidiaries of the Company.

	 	 	 
	2.4 	
      Financial Statements; Books and Records

	 	 	 
		(a) 	
      The audited and unaudited consolidated financial
      statements (including any related notes) provided by the Company to
      Parent: (i) complied as to form in all material respects with the
      published rules, regulations, policies and notices of the Financial
      Accounting Standards Board (“FASB”) applicable thereto; (ii) were prepared
      in accordance with United States generally accepted accounting principles
      applied on a consistent basis throughout the periods covered (except as
      may be indicated in the notes to such financial statements or, in the case
      of unaudited statements, as permitted by the FASB, and except that the
      unaudited financial statements may not contain footnotes and are subject
      to normal and recurring year-end adjustments that will not, individually
      or in the aggregate, be material in amount), and (iii) fairly present the
      consolidated financial position of the Company and its consolidated
      subsidiaries as of the respective dates thereof and the consolidated
      results of operations and cash flows of the Company and its consolidated
      subsidiaries for the periods covered thereby.

	 	 	 
		(b) 	
      The books, records and accounts of each of the Acquired
      Corporations, in all material respects, (i) have been maintained in
      accordance with good business practices consistent with prior years, (ii)
      are stated in reasonable detail and accurately and fairly reflect the
      transactions and dispositions of the assets of such Acquired Corporations,
      and (iii) accurately and fairly reflect the basis for the financial
      statements referred to in Section 2.4(a) of this Schedule B. The Company
      has devised and maintains a system of internal accounting controls
      sufficient to provide reasonable assurances that: (i) transactions are
      executed in accordance with management’s general or specific
      authorization; and (ii) transactions are recorded as necessary (A) to
      permit preparation of financial statements in conformity with United
      States generally accepted accounting principles or any other criteria
      applicable to such statements and (B) to maintain accountability for
      assets.

	 	 	 
	2.5 	
      Absence of Changes

     Between February 28, 2007 and the
date of the Agreement, except as contemplated herein: 

	 	(a) 	
      no event, violation, circumstance or other matter has
      occurred or arisen that, in combination with any other events or
      circumstances, has had or would reasonably be expected to have a Material
      Adverse Effect on the Acquired Corporations;

	 	 	 
	 	(b) 	
      there has not been any material loss, damage or
      destruction to, or any material interruption in the use of, any of the
      assets of any of the Acquired Corporations (whether or not covered by
      insurance);

B-4 

	 	(c) 	
      none of the Acquired Corporations has: (i) declared,
      accrued, set aside or paid any dividend or made any other distribution in
      respect of any Common Shares, or (ii) repurchased, redeemed or otherwise
      reacquired any Common Shares or other securities;

	 	 	 
	 	(d) 	
      none of the Acquired Corporations has sold, issued or
      granted, or authorized the issuance of, (i) any shares, capital stock or
      other security (except for Common Shares issued upon the valid exercise of
      outstanding Company Options or as contemplated under the Arrangement),
      (ii) any option, warrant or right to acquire any shares, capital stock or
      any other security (except for Company Options identified in Part 2.3(b)
      of the Company Disclosure Schedule), or (iii) any instrument convertible
      into or exchangeable for any shares, capital stock or other
    security;

	 	 	 
	 	(e) 	
      the Company has not amended or waived any of its rights
      under, or permitted the acceleration of vesting under, (i) any provision
      of any of the Company’s stock option plans, or (ii) any provision of any
      Contract evidencing any outstanding Company Option;

	 	 	 
	 	(f) 	
      there has been no amendment to the certificate of
      incorporation, articles, bylaws or other charter or organizational
      documents of any of the Acquired Corporations, and none of the Acquired
      Corporations has effected or been a party to any merger, amalgamation,
      arrangement, consolidation, share exchange, business combination,
      recapitalization, reclassification of shares, stock split, reverse stock
      split or similar transaction;

	 	 	 
	 	(g) 	
      none of the Acquired Corporations has formed any
      Subsidiary or acquired any equity interest or other interest in any other
      Entity;

	 	 	 
	 	(h) 	
      none of the Acquired Corporations has made any capital
      expenditure which, when added to all other capital expenditures made on
      behalf of the Acquired Corporations exceeds Cdn$50,000 in the
      aggregate;

	 	 	 
	 	(i) 	
      none of the Acquired Corporations has (i) entered into or
      permitted any of the assets owned or used by it to become bound by any
      Company Material Contract except in the ordinary course of business and
      consistent with past practices, or (ii) amended or terminated, or waived
      any material right or remedy under, any Material Contract;

	 	 	 
	 	(j) 	
      none of the Acquired Corporations has (i) acquired,
      leased or licensed any material right or other material asset from any
      other Person except in the ordinary course of business and consistent with
      past practices, (ii) sold or otherwise disposed of, or leased or licensed,
      any material right or other material asset to any other Person, or (iii)
      waived or relinquished any material right;

	 	 	 
	 	(k) 	
      none of the Acquired Corporations has written off as
      uncollectible, or established any extraordinary reserve with respect to,
      any account receivable or other indebtedness having a value in excess of
      Cdn$50,000 in any individual case;

	 	 	 
	 	(l) 	
      none of the Acquired Corporations has made any pledge of
      any of its assets or otherwise permitted any of its assets to become
      subject to any Encumbrance, except for pledges of immaterial assets made
      in the ordinary course of business and consistent with past
    practices;

	 	 	 
	 	(m) 	
      none of the Acquired Corporations has (i) lent money to
      any Person, or (ii) guaranteed any indebtedness for borrowed
  money;

B-5 

	 	(n) 	
      none of the Acquired Corporations has (i) adopted,
      established or entered into any Employee Plan (as defined in Section 2.16
      of this Schedule B), (ii) caused or permitted any Employee Plan to be
      amended in any material respect, or (iii) paid any bonus or made any
      profit-sharing or similar payment to, or materially increased the amount
      of the wages, salary, commissions, fringe benefits or other compensation
      or remuneration payable to, any of its directors, officers or employees,
      other than in the normal course of business and consistent with past
      practices;

	 	 	 
	 	(o) 	
      none of the Acquired Corporations has changed any of its
      methods of accounting or accounting principles or practices in any
      respect, except as otherwise required by United States generally accepted
      accounting principles;

	 	 	 
	 	(p) 	
      none of the Acquired Corporations has made any Tax
      election;

	 	 	 
	 	(q) 	
      none of the Acquired Corporations has commenced or
      settled any Legal Proceeding;

	 	 	 
	 	(r) 	
      none of the Acquired Corporations has entered into any
      material transaction or taken any other material action that, either
      individually or in the aggregate, has had, or could reasonably be expected
      to have, a Material Adverse Effect on the Acquired Corporations;

	 	 	 
	 	(s) 	
      none of the Acquired Corporations has entered into any
      material transaction or taken any other material action outside the
      ordinary course of business or inconsistent with past practices;
  and

	 	 	 
	 	(t) 	
      none of the Acquired Corporations has agreed or committed
      to take any of the actions referred to in clauses “(c)” through “(t)”
      above.

	2.6 	Title to Assets 

     The Acquired Corporations own,
and have good and valid title to, all assets purported to be owned by them,
including: (i) all assets reflected on the Audited Balance Sheet and the
Unaudited Interim Balance Sheet (except for inventory sold or otherwise disposed
of in the ordinary course of business since the date of the Unaudited Interim
Balance Sheet); and (ii) all other assets reflected in the books and records of
the Acquired Corporations as being owned by the Acquired Corporations. All of
said assets are owned by the Acquired Corporations free and clear of any
Encumbrances, except for (1) any lien for current taxes not yet due and payable,
(2) minor liens that have arisen in the ordinary course of business and that do
not (in any case or in the aggregate) materially detract from the value of the
assets subject thereto or materially impair the operations of any of the
Acquired Corporations, and (3) liens described in Part 2.6 of the Company
Disclosure Schedule. 

	2.7 	
      Receivables; Employee Loans; Advances.

	 	 	 
		(a) 	
      All existing accounts receivable of the Acquired
      Corporations (including those accounts receivable reflected on the
      Unaudited Interim Balance Sheet that have not yet been collected and those
      accounts receivable that have arisen since the date thereof and have not
      yet been collected) (a) represent valid obligations of customers of the
      Acquired Corporations arising from bona fide transactions entered into in
      the ordinary course of business, (b) are current and, to the Company’s
      knowledge, will be collected in full, without any counterclaim or set
      off.

B-6 

	 	(b) 	
      Part 2.7(b) of the Company Disclosure Schedule contains
      an accurate and complete list as of the date of the Agreement of all
      outstanding loans and advances made by any of the Acquired Corporations to
      any employee, director, consultant or independent contractor, other than
      routine travel, meal and related advances made to employees in the
      ordinary course of business.

	2.8 	Real Property; Equipment; Leasehold
  

     All material items of equipment
and other tangible assets owned by or leased to the Acquired Corporations are
adequate for the uses to which they are being put, are in good and safe
condition and repair (ordinary wear and tear excepted) and are adequate for the
conduct of the business of the Acquired Corporations in the manner in which such
business is currently being conducted. None of the Acquired Corporations own any
real property or any interest in real property, except for the leaseholds
created under the real property leases identified in Part 2.8(a)(i) of the
Company Disclosure Schedule. 

	2.9 	
      Proprietary Assets.

	 	 	 
		(a) 	
      Part 2.9(a)(i) of the Company Disclosure Schedule sets
      forth, with respect to each Proprietary Asset owned by any of the Acquired
      Corporations and registered with any Governmental Body or for which an
      application has been filed with any Governmental Body, (i) a brief
      description of such Proprietary Asset, and (ii) the names of the
      jurisdictions covered by the applicable registration or application. Part
      2.9(a)(ii) of the Company Disclosure Schedule identifies each Proprietary
      Asset owned by any of the Acquired Corporations that is material to the
      business of the Acquired Corporations. Part 2.9(a)(iii) of the Company
      Disclosure Schedule identifies any ongoing royalty or payment obligations
      in excess of $10,000 with respect to, each Proprietary Asset that is
      licensed or otherwise made available to any of the Acquired Corporations
      by any Person and is material to the business of the Acquired Corporations
      (except for any Proprietary Asset that is licensed to any Acquired
      Corporation under any third party software license generally available to
      the public), and identifies the Contract under which such Proprietary
      Asset is being licensed or otherwise made available to such Acquired
      Corporation. The Acquired Corporations have good and valid title to all of
      the Acquired Corporation Proprietary Assets identified or required to be
      identified in Parts 2.9(a)(i) and 2.9(a)(ii) of the Company Disclosure
      Schedule, free and clear of all Encumbrances, except for any lien for
      current taxes not yet due and payable, and minor liens that have arisen in
      the ordinary course of business and that do not (individually or in the
      aggregate) materially detract from the value of the Acquired Corporation
      Proprietary Asset subject thereto or materially impair the operations of
      either of the Acquired Corporations. The Acquired Corporations have a
      valid right to use, license and otherwise exploit all Proprietary Assets
      identified or required to be identified in Part 2.9(a)(iii) of the Company
      Disclosure Schedule, subject to the terms thereof. None of the Acquired
      Corporations has developed jointly with any other Person any Acquired
      Corporation Proprietary Asset that is material to the business of the
      Acquired Corporations and with respect to which such other Person has any
      rights. There is no Acquired Corporation Contract (with the exception of
      end user license agreements, support agreements, consulting agreements and
      other customer contracts in the forms previously delivered by the Company
      to Parent) pursuant to which any Person has any right (whether or not
      currently exercisable) to use, license or otherwise exploit any Acquired
      Corporation Proprietary Asset.

B-7 

		(b) 	
      The Acquired Corporations have taken reasonable measures
      and precautions to protect and maintain the confidentiality, secrecy and
      value of all material Acquired Corporation Proprietary Assets (except
      Acquired Corporation Proprietary Assets whose value would be unimpaired by
      disclosure). No current or former employee, officer, director,
      shareholder, consultant or independent contractor has any right, claim or
      interest in or with respect to any Acquired Corporation Proprietary
      Asset.

	 	 	 	 
		(c) 	
      All patents, trademarks, service marks and copyrights
      held by any of the Acquired Corporations are valid, enforceable and
      subsisting and none of the Acquired Corporation Proprietary Assets and no
      Proprietary Asset that is currently being developed by any of the Acquired
      Corporations (either by itself or with any other Person), to the Company’s
      knowledge, infringes, misappropriates or conflicts with any Proprietary
      Asset owned or used by any other Person. None of the Acquired Corporations
      has received any notice or other communication (in writing or otherwise)
      of any actual, alleged, possible or potential infringement,
      misappropriation or unlawful or unauthorized use of, any Proprietary Asset
      owned or used by any other Person. To the best of the knowledge of the
      Company, no other Person is materially infringing, misappropriating or
      making any unlawful or unauthorized use of, and no Proprietary Asset owned
      or used by any other Person infringes or conflicts with, any material
      Acquired Corporation Proprietary Asset.

	 	 	 	 
		(d) 	
      The Acquired Corporation Proprietary Assets constitute
      all the Proprietary Assets necessary to enable the Acquired Corporations
      to conduct their business in the manner in which such business has been
      and is being conducted. None of the Acquired Corporations has (i) licensed
      any Acquired Corporation Proprietary Assets to any Person on an exclusive
      basis, or (ii) entered into any covenant not to compete or Contract
      limiting or purporting to limit the ability of any Acquired Corporation to
      exploit fully any Acquired Corporation Proprietary Assets or to transact
      business in any market or geographical area or with any Person.

	 	 	 	 
	2.10 	
      Contracts.

	 	 	 	 
		(a) 	
      Part 2.10 of the Company Disclosure Schedule identifies
      each Acquired Corporation Contract that constitutes a “Company Material
      Contract” of or to the Acquired Corporations. For purposes of the
      Agreement, each of the following shall be deemed to constitute a “Company
      Material Contract”:

	 	 	 	 
			(i) 	
      any Contract (A) relating to the employment of, or the
      performance of services by, any employee or consultant, (B) pursuant to
      which any of the Acquired Corporations is or may become obligated to make
      any severance, termination, change in control or similar payment to any
      current or former employee or director, or (C) pursuant to which any of
      the Acquired Corporations is or may become obligated to make any bonus or
      similar payment (other than payments constituting base salary or normal
      commissions) in excess of Cdn$10,000 to any current or former employee or
      director;

	 	 	 	 
			(ii) 	
      any material Contract relating to the acquisition,
      transfer, development, sharing or license of any Proprietary Asset (except
      for any Contract pursuant to which (A) any Proprietary Asset is licensed
      to the Acquired Corporations under any third party software license
      generally available to the public, or (B) any Proprietary Asset which is
      not material to any of the Acquired
Corporations’

B-8 

	 		
      respective businesses and is licensed by any of the
      Acquired Corporations to any Person on a non-exclusive basis);

	 	 	 
	 	(iii) 	
      any Contract pursuant to which (a) any monies have been
      loaned to any of the Acquired Corporations, or (B) any of the Acquired
      Corporations have granted a security interest in any of its
  assets;

	 	 	 
	 	(iv) 	
      any Contract imposing any restriction on the right or
      ability of any Acquired Corporation (A) to compete with any other Person,
      (B) to acquire any product or other asset or any services from any other
      Person, (C) to develop, sell, supply, distribute, offer, support or
      service any product or any technology or other asset to or for any other
      Person, or (D) to perform services for any other Person;

	 	 	 
	 	(v) 	
      any Contract (other than Contracts evidencing Company
      Options) (A) relating to the acquisition, issuance, voting, registration,
      sale or transfer of any securities, (B) providing any Person with any
      pre-emptive right, right of participation, or similar right with respect
      to any securities, or (C) providing any of the Acquired Corporations with
      any right of first refusal with respect to, or right to repurchase or
      redeem, any securities;

	 	 	 
	 	(vi) 	
      any Contract incorporating or relating to any guarantee,
      any warranty or any indemnity or similar obligation, except for Contracts
      substantially identical to the end-user licenses, support agreements,
      consulting agreements and other customer contracts in the forms previously
      delivered by the Company to Parent;

	 	 	 
	 	(vii) 	
      any Contract containing “standstill” or similar
      provisions;

	 	 	 
	 	(viii) 	
      any Contract (A) to which any Governmental Body is a
      party or under which any Governmental Body has any rights or obligations,
      or (B) directly or indirectly benefiting any Governmental Body (including
      any subcontract or other Contract between any Acquired Corporation and any
      contractor or subcontractor to any Governmental Body);

	 	 	 
	 	(ix) 	
      any Contract requiring that any of the Acquired
      Corporations give any notice or provide any information to any Person
      prior to considering or accepting any Acquisition Proposal or similar
      proposal, or prior to entering into any discussions, agreement,
      arrangement or understanding relating to any Acquisition Transaction or
      similar transaction;

	 	 	 
	 	(x) 	
      any Contract that contemplates or involves the guaranteed
      payment or delivery of cash or other consideration in an amount or having
      a value in excess of $50,000 in the aggregate or the payment of such
      consideration any time between the Effective Date and the date of the
      Agreement, or contemplates or involves the performance of services having
      a value in excess of $50,000 in the aggregate; and

	 	 	 
	 	(xi) 	
      any Contract that is otherwise material to any of the
      Acquired Corporations, including any Contract that could reasonably be
      expected to have a material effect on the ability of the Company to
      perform any of its obligations under, or to consummate any of the
      transactions contemplated by, the Agreement.

B-9 

	 		
      The Company has delivered or made available to Parent an
      accurate and complete copy of each Acquired Corporation Contract that
      constitutes a Company Material Contract.

	 	 	 
	 	(b) 	
      Each Acquired Corporation Contract that constitutes a
      Company Material Contract is valid and in full force and effect, and is
      enforceable in accordance with its terms, subject to (i) laws of general
      application relating to bankruptcy, insolvency and the relief of debtors,
      and (ii) rules of law governing specific performance, injunctive relief
      and other equitable remedies.

	 	 	 
	 	(c) 	
      None of the Acquired Corporations has violated or
      breached, or committed any default in any material respect under, any
      Acquired Corporation Contract that constitutes a Company Material Contract
      and, to the best of the knowledge of the Company, no other Person has
      violated or breached, or committed any default under, any such Acquired
      Corporation Contract. To the best of the knowledge of the Company, with
      respect to each Acquired Corporation Contract that is a Company Material
      Contract, no event has occurred, and no circumstance or condition exists,
      that (with or without notice or lapse of time) could reasonably be
      expected to (A) result in a violation or breach of any of the provisions
      of any such Acquired Corporation Contract, (B) give any Person the right
      to declare a default or exercise any remedy under any such Acquired
      Corporation Contract, (C) give any Person the right to receive or require
      a rebate, chargeback, penalty or change in delivery schedule under any
      such Acquired Corporation Contract, (D) give any Person the right to
      accelerate the maturity or performance of any such Acquired Corporation
      Contract, or (E) give any Person the right to cancel, terminate or modify
      any such Acquired Corporation Contract. Since February 28, 2006, none of
      the Acquired Corporations has received any notice or other communication
      regarding any actual or possible violation or breach of, or default under,
      any material Acquired Corporation Contract.

	2.11 	Liabilities 

     None of the Acquired Corporations
has any accrued, contingent or other liabilities of any nature, either matured
or unmatured, except for: (a) liabilities identified as such in the
“liabilities” column of the Unaudited Interim Balance Sheet; (b) normal and
recurring current liabilities that have been incurred by the Acquired
Corporations since the date thereof in the ordinary course of business and
consistent with past practices; and (c) liabilities described in Part 2.11 of
the Company Disclosure Schedule. 

	2.12 	Compliance with Legal Requirements
  

     To the Company’s knowledge, each
of the Acquired Corporations is, and has at all times been, in compliance in all
material respects with all applicable Legal Requirements. Since February 28,
2006, none of the Acquired Corporations has received any notice or other
communication from any Governmental Body or other Person regarding any actual or
possible material violation of, or failure to comply with, any Legal
Requirement. 

	2.13 	Certain Business Practices

     There is no Contract, judgment,
injunction, order or decree binding upon any of the Acquired Corporations that
has or could reasonably be expected to have the effect of prohibiting,
restricting or materially impairing any business practice of any of the Acquired
Corporations, any acquisition of property by any of the Acquired Corporations or
the conduct of business by any of the Acquired Corporations as currently
conducted. 

B-10 

	2.14 	Governmental Authorizations.
  

     The Acquired Corporations hold all
Governmental Authorizations necessary to enable the Acquired Corporations to
conduct their respective businesses in the manner in which such businesses are
currently being conducted. All such Governmental Authorizations are valid and in
full force and effect. Each Acquired Corporation is in substantial compliance
with the terms and requirements of such Governmental Authorizations. None of the
Acquired Corporations has received any notice or other communication from any
Governmental Body regarding (a) any actual or possible violation of or failure
to comply with any term or requirement of any material Governmental
Authorization, or (b) any actual or possible revocation, withdrawal, suspension,
cancellation, termination or modification of any material Governmental
Authorization. No Governmental Body has at any time challenged in writing the
right of any of the Acquired Corporations to design, manufacture, offer or sell
any of its respective products or services. 

	2.15 	Tax Matters 

	 	(a) 	
      Each of the Tax Returns required to be filed by or on
      behalf of the respective Acquired Corporations with any Governmental Body
      with respect to any taxable period ending on or before the Closing Date
      (the “Acquired Corporation Returns”) (i) has been or will be filed on or
      before the applicable due date (including any extensions of such due
      date), and (ii) has been, or will be when filed, prepared in all material
      respects in compliance with all applicable Legal Requirements and will be
      true and correct in all material respects. All amounts shown on the
      Acquired Corporation Returns to be due on or before the Closing Date have
      been or will be paid on or before the Closing Date. All Taxes required to
      be withheld or collected have been and will continue to be withheld and
      paid or remitted on or before the applicable due date up to and before the
      Closing Date.

	 	 	 
	 	(b) 	
      The Unaudited Interim Balance Sheet fully accrues all
      actual and contingent liabilities for Taxes with respect to all periods
      through the date thereof in accordance with United States generally
      accepted accounting principles. Each Acquired Corporation will establish,
      in the ordinary course of business and consistent with its past practices,
      reserves adequate for the payment of all Taxes for the period from the
      date thereof through the Closing Date.

	 	 	 
	 	(c) 	
      No claim, Legal Proceeding adjustment, assessment or
      reassessment is pending or, to the best of the knowledge of the Company,
      has been threatened, either formally or informally, against or with
      respect to any Acquired Corporation in respect of any Tax. There are no
      unsatisfied liabilities for Taxes (including related expenses) with
      respect to any notice of assessment or reassessment or similar document
      received by any Acquired Corporation with respect to any Tax (other than
      liabilities for Taxes asserted under any such notice of assessment or
      reassessment or similar document which are being contested in good faith
      by the Acquired Corporations and with respect to which adequate reserves
      for payment have been established on the Unaudited Interim Balance Sheet).
      There are no liens for Taxes upon any of the assets of any of the Acquired
      Corporations except liens for current Taxes not yet due and payable. None
      of the Acquired Corporations has entered into or become bound by any
      agreement or consent pursuant to Section 341(f) of the Code (or any
      comparable provision of state or foreign Tax laws). None of the Acquired
      Corporations has been, and none of the Acquired Corporations will be,
      required to include any adjustment in taxable income for any tax period
      (or portion thereof) pursuant to Section 481 or 263A of the Code (or any
      comparable provision of state or foreign Tax laws) as a result of
      transactions or events occurring, or accounting
methods

B-11 

	 		
      employed, prior to the Closing. None of the Acquired
      Corporations has made any distribution of stock of any controlled
      corporation, as that term is defined in Section 355(a)(1) of the
    Code.

	 	 	 
	 	(d) 	
      Each Acquired Corporation is in full compliance with all
      terms and conditions of any Tax exemptions, Tax holiday or other Tax
      reduction agreement or order of any Governmental Body and the consummation
      of the Arrangement will have no adverse effect on the continued validity
      and effectiveness of any such Tax exemptions, Tax holiday or other Tax
      reduction agreement or order.

	2.16 	
      Employee and Labor Matters; Benefit
  Plans.

	 	 	 
		(a) 	
      Part 2.16(a) of the Company Disclosure Schedule
      identifies each salary, bonus, vacation, deferred compensation, incentive
      compensation, stock purchase, stock option, severance pay, termination
      pay, death and disability benefits, hospitalization, medical, life or
      other insurance, flexible benefits, supplemental unemployment benefits,
      profit-sharing, pension or retirement plan, program or agreement and each
      other employee benefit plan or arrangement (collectively, the “Employee
      Plans”) sponsored, maintained, contributed to or required to be
      contributed to by any of the Acquired Corporations for the benefit of any
      current or former employee of any of the Acquired Corporations. The
      Company has delivered to Parent accurate and complete copies of the
      Employee Plans currently in force and all amendments thereto together
      with, as applicable, accurate and complete copies of all funding
      agreements and any Contracts relating to such Employee Plans (including
      service provider agreements, insurance contracts, minimum premium
      contracts, stop-loss agreements, investment management agreements,
      subscription and participation agreements and recordkeeping agreements),
      all summary descriptions of the Employee Plans provided to past or present
      participants therein, any annual information returns required to be filed
      under a Legal Requirement, the financial statements, if any, and evidence
      of any registration in respect thereof.

	 	 	 
		(b) 	
      All of the Employee Plans are, and have been since their
      establishment, duly registered where required by Legal Requirement
      (including registration with the relevant tax authorities where such
      registration is required to qualify for tax exemption or other beneficial
      tax status) and are in good standing under, and in compliance with, all
      Legal Requirements.

	 	 	 
		(c) 	
      All Employee Plans have been administered in accordance
      with their terms, there are no outstanding defaults or violations by any
      of the Acquired Corporations of any obligation required to be performed by
      it in connection with any Employee Plan and no order has been made or
      notice given pursuant to any Legal Requirements requiring (or proposing to
      require) any of the Acquired Corporations to take (or refrain from taking)
      any action in respect of any Employee Plan.

	 	 	 
		(d) 	
      There are no actions, suits, claims, trials, demands,
      investigations, arbitrations or other proceedings pending or, to the
      knowledge of any of the Acquired Corporations threatened with respect to
      the Employee Plans against any of the Acquired Corporations, the funding
      agent, the insurers or the fund of such Employee Plans, other than claims
      for benefits in the ordinary course.

	 	 	 
		(e) 	
      Neither the execution, delivery or performance of the
      Agreement, nor the consummation of the Arrangement or any of the other
      transactions contemplated by the Agreement,
will

B-12 

	 		
      result in any bonus, golden parachute, severance or other
      payment or obligation to any current or former employee or director of any
      of the Acquired Corporations (whether or not under any Employee Plan), or
      materially increase the benefits payable or provided under any Employee
      Plan, or result in any acceleration of the time of payment or vesting of
      any such benefits.

	 	 	 
	 	(f) 	
      Part 2.16(f) of the Company Disclosure Schedule contains
      a list of all salaried employees of each of the Acquired Corporations as
      of the date of the Agreement, and correctly reflects, in all material
      respects, their salaries, any other compensation payable to them
      (including compensation payable pursuant to bonus, deferred compensation
      or commission arrangements), their dates of employment and their
      positions. None of the Acquired Corporations is a party to any collective
      bargaining agreement with a trade union or council of trade unions. No
      trade union, council of trade unions, employee bargaining agency or
      affiliated bargaining agent holds bargaining rights with respect to any of
      the Acquired Corporations employees by way of certification, interim
      certification, voluntary recognition, designation or successor rights, has
      applied to be certified as a bargaining agent of any of the Acquired
      Corporations’ employees or has applied to have any of the Acquired
      Corporations declared a related employer pursuant to applicable labor,
      employment or similar laws. Except as contemplated herein or set out in
      the Company Disclosure Schedule, all of the employees of the Acquired
      Corporations are employed for an indefinite term and the employment of
      such employees may be terminated on reasonable notice.

	 	 	 
	 	(g) 	
      Each of the Acquired Corporations is in compliance in all
      material respects with all applicable Legal Requirements and Contracts
      relating to employment, employment standards, employment practices, wages,
      bonuses, benefits and terms and conditions of employment, including
      employee compensation matters.

	 	 	 
	 	(h) 	
      All amounts owing in respect of employee payroll
      withholding obligations, remittances, premiums, contributions and
      assessments under provincial or federal statutes or employee benefit plans
      have been fully accrued in the books and records of the Acquired
      Corporations and wages, vacation pay, holiday pay and employee benefits of
      the employees of the Acquired Corporations have been fully accrued in the
      Corporations’ books and records and reflected as such in the Corporations’
      financial statements.

	2.17 	Insurance 

     The Company has delivered or made
available to Parent a copy of all material insurance policies and all material
self insurance programs and materials relating to the business, assets and
operations of the Acquired Corporations. Each of such insurance policies is in
full force and effect. None of the Acquired Corporations has received any notice
or other communication regarding any actual or possible (a) cancellation or
invalidation of any insurance policy, (b) refusal of any coverage or rejection
of any material claim under any insurance policy, or (c) material adjustment in
the amount of the premiums payable with respect to any insurance policy. There
is no pending workers’ compensation or other claim under or based upon any
insurance policy of any of the Acquired Corporations. 

	2.18 	Legal Proceedings; Orders.

	 	(a) 	
      There is no pending Legal Proceeding, and to the best of
      the knowledge of the Company, no Person has threatened to commence any
      Legal Proceeding: (i) that involves any of the Acquired Corporations or
      any of the assets owned or used by any of the
Acquired

B-13 

	 		
      Corporations; or (ii) that challenges, or that may have
      the effect of preventing, delaying, making illegal or otherwise
      interfering with, the Arrangement or any of the other transactions
      contemplated by the Agreement. To the best of the knowledge of the
      Company, no event has occurred, and no claim, dispute or other condition
      or circumstance exists that could reasonably be expected to, give rise to
      or serve as a basis for the commencement of any such Legal
    Proceeding.

	 	 	 
	 	(b) 	
      There is no order, writ, injunction, judgment or decree
      to which any of the Acquired Corporations, or any of the assets owned or
      used by any of the Acquired Corporations, is subject. To the best of the
      knowledge of the Company, no officer or key employee of any of the
      Acquired Corporations is subject to any order, writ, injunction, judgment
      or decree that prohibits such officer or other employee from engaging in
      or continuing any conduct, activity or practice relating to the business
      of any of the Acquired Corporations.

	2.19 	Authority; Binding Nature of Agreement
    

     The Company has the requisite
corporate power and authority to enter into and to perform its obligations under
the Agreement. The board of directors of the Company (at a meeting duly called
and held) has (a) unanimously determined that the Arrangement is fair to the
Company Securityholders and in the best interests of the Company, (b)
unanimously authorized and approved the execution, delivery and performance of
the Agreement by the Company and unanimously approved the Arrangement, and (c)
unanimously determined to recommend the approval of the Agreement by the holders
of Common Shares and directed that the Agreement and the Arrangement be
submitted for consideration by the Company Securityholders at the Company
Securityholders’ Meeting (as defined in Section 5.1 of the Agreement). The
Agreement constitutes the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with its terms, subject to (i)
laws of general application relating to bankruptcy, insolvency and any similar
law relating to creditors’ rights, and (ii) rules of law governing specific
performance, injunctive relief and other equitable remedies. 

	2.20 	Vote Required 

     Subject to the terms and
conditions of the Interim Order, the approval of the Arrangement by two-thirds
of the votes cast at the Company Securityholders’ Meeting (the “Required Company
Securityholder Vote”) is the only vote of the holders of any class or series of
the Company’s capital and securities necessary to approve the Arrangement and to
otherwise consummate the transactions contemplated by the Agreement. 

	2.21 	Non-Contravention; Consents
  

     Neither (1) the execution,
delivery or performance of the Agreement, nor (2) the consummation by the
Company of the Arrangement or any of the other transactions contemplated by the
Agreement, will directly or indirectly (with or without notice or lapse of
time): 

	 	(a) 	
      contravene, conflict with or result in a violation of (i)
      any of the provisions of the articles or certificate of incorporation,
      bylaws or other charter or organizational documents of any of the Acquired
      Corporations, or (ii) any resolution adopted by the shareholders, the
      board of directors or any committee of the board of directors of any of
      the Acquired Corporations;

	 	 	 
	 	(b) 	
      subject to obtaining the Consents set forth in Section
      6.4 of the Agreement, contravene, conflict with or result in a violation
      of any Legal Requirement or any order, writ,

B-14 

	 		
      injunction, judgment or decree to which any of the
      Acquired Corporations, or any of the assets owned or used by any of the
      Acquired Corporations, is subject;

	 	 	 
	 	(c) 	
      contravene, conflict with or result in a violation of any
      of the terms or requirements of, or give any Governmental Body the right
      to revoke, withdraw, suspend, cancel, terminate or modify, any
      Governmental Authorization that is held by any of the Acquired
      Corporations or that otherwise relates to the business of any of the
      Acquired Corporations or to any of the assets owned or used by any of the
      Acquired Corporations;

	 	 	 
	 	(d) 	
      to the Company’s knowledge, contravene, conflict with or
      result in a violation or breach of, or result in a default under, any
      provision of any material Acquired Corporation Contract, or give any
      Person the right to (i) declare a default or exercise any remedy under any
      such Acquired Corporation Contract, (ii) a rebate, chargeback, penalty or
      change in delivery schedule under any such Acquired Corporation Contract,
      (iii) accelerate the maturity or performance of any such Acquired
      Corporation Contract, or (iv) cancel, terminate or modify any term of such
      material Acquired Corporation Contract;

	 	 	 
	 	(e) 	
      result in the imposition or creation of any Encumbrance
      upon or with respect to any asset owned or used by any of the Acquired
      Corporations (except for minor liens that will not, in any case or in the
      aggregate, materially detract from the value of the assets subject thereto
      or materially impair the operations of any of the Acquired Corporations);
      or

	 	 	 
	 	(f) 	
      result in, or increase the likelihood of, the disclosure
      or delivery to any escrowholder or other Person of any Acquired
      Corporation Source Code, or the transfer of any material asset of any of
      the Acquired Corporations to any Person.

Except as may be required by the Interim Order, the Final
Order, applicable securities laws, the CBCA, any other foreign antitrust law or
regulation, none of the Acquired Corporations was, is or will be required to
make any filing with or give any notice to, or to obtain any Consent from, any
Person in connection with (x) the execution, delivery or performance of the
Agreement by the Company, or (y) the consummation by the Company of the
Arrangement or any of the other transactions contemplated by the Agreement. 

	2.22 	No Broker or Finder 

     No broker, finder or investment
banker is entitled to any brokerage, finder’s or other fee or commission in
connection with the Arrangement or any of the other transactions contemplated by
the Agreement based upon arrangements made by or on behalf of any of the
Acquired Corporations.

	2.23 	Registration Rights 

     No holder of securities issued by
any of the Acquired Corporations has any right to compel such Acquired
Corporation to register or otherwise qualify such securities for public sale in
Canada or the United States. 

	2.24 	Full Disclosure 

     This Schedule B and the Agreement
(including the Company Disclosure Schedule) does not, and will not, (i) contain
any representation, warranty or information that is false or misleading with
respect to any material fact, or (ii) omit to state any material fact necessary
in order to make the representations, 

B-15 

warranties and information contained and to be contained herein
and therein (in the light of the circumstances under which such representations,
warranties and information were or will be made or provided) not false or
misleading. 

	2.25 	Working Capital Requirements
  

     On or before the Closing, the Company
will have cash of not less than $2.5 million and working capital, defined as
current assets less current liabilities of $2.7 million. 

	2.26 	Bell Canada Debt 

     On or before the Closing, the Company
will ensure that the debt, in the principal amount of $2.0 million, and accrued
interest thereon, owed to Bell Canada is converted or repaid. 

	2.27 	Wesley Clover Debt 

     On or before the Closing, the Company
will ensure that all debt and accrued interest owed to Wesley Clover is
converted to Common Shares. 

	SCHEDULE C 
	  
	TO THE ARRANGEMENT AGREEMENT AMONG 
	COUNTERPATH SOLUTIONS, INC, 6789722 CANADA INC. AND

	NEWHEIGHTS SOFTWARE CORPORATION 

	1. 	DEFINITIONS; CURRENCY

     Certain capitalized terms used in this
Schedule C are defined in Schedule A to the Arrangement Agreement dated June 15,
2007, among CounterPath Solutions, Inc., 6789722 Canada Inc. and NewHeights
Software Corporation. Unless otherwise specified, all references to this
Schedule C to sums of money, “dollars” or “$” shall mean United States Dollars.

	2. 	REPRESENTATIONS AND WARRANTIES OF PARENT AND
      EXCHANGECO 

     Parent and ExchangeCo represent
and warrant to the Company except as set forth in the Parent Disclosure Schedule
prepared in accordance with the Agreement: 

	2.1 	Subsidiaries; Due Organization; Etc.
  

      Parent is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Nevada and has no subsidiaries other than ExchangeCo or as disclosed in the
Parent Disclosure Schedule or owns any shares or equity interests of any nature
in any other entity. ExchangeCo is a corporation duly organized, validly
existing and in good standing under the laws of Canada. Each of Parent and
ExchangeCo has all necessary power and authority: (a) to conduct its business in
the manner in which its business is currently being conducted; (b) to own and
use its assets in the manner in which its assets are currently owned and used;
and (c) to perform its obligations under all Contracts by which it is bound.
Parent has not agreed nor is obligated to make, or is bound by any Contract
under which it may become obligated to make, any future investment in or capital
contribution to any other Entity. Parent has not, at any time, been a general
partner of, nor has otherwise been liable for any of the debts or other
obligations of, any general partnership, limited partnership or other Entity.

	2.2 	Certificate of Incorporation and Bylaws
    

     Parent and ExchangeCo have
delivered or made available to the Company accurate and complete copies of the
certificate of incorporation, articles, bylaws and other charter and
organizational documents of Parent and ExchangeCo, respectively, including all
amendments thereto. 

	2.3 	
      Capitalization, Etc.

	 	 	 
		(a) 	
      The authorized capital stock of Parent consists of
      415,384,500 shares of Parent Common Stock. As of June 15, 2007, 37,940,983
      shares of Parent Common Stock were issued and outstanding. All of the
      outstanding shares of Parent Common Stock have been duly authorized and
      validly issued, and are fully paid and nonassessable. As of June 15, 2007,
      Parent had issued or committed to issue stock options to purchase (i)
      14,320,600 shares of Parent Common Stock pursuant to the 2004 and 2005
      Stock Option Plans. Shares of Parent Common Stock are reserved for future
      issuance pursuant to outstanding stock options. Parent is not under any
      obligation, nor is bound by any Contract pursuant to which it may become
      obligated, to repurchase, redeem or otherwise acquire any outstanding
      shares of Parent Common Stock.

C-2 

		(b) 	
      The authorized capital stock of ExchangeCo consists of an
      unlimited number of common shares. As of June 15, 2007, 100 common shares
      of ExchangeCo were issued and outstanding. All of the outstanding common
      shares of ExchangeCo have been duly authorized and validly issued, and are
      fully paid and nonassessable.

	 	 	 
		(c) 	
      Except as set in Parent SEC Documents, the Parent
      Disclosure Schedule or as contemplated herein, there is no (i) outstanding
      subscription, option, call, warrant or right (whether or not currently
      exercisable) to acquire any shares of Parent Common Stock or other shares
      of the capital stock or other securities of Parent; (ii) outstanding
      security, instrument or obligation that has the right to vote (other than
      shares of Parent Common Stock) or that is or may become convertible into
      or exchangeable for any shares of Parent Common Stock or other shares of
      the capital stock or other securities of Parent; or (iii) to Parent’s
      knowledge, any condition or circumstance that may give rise to or provide
      a basis for the assertion of a claim by any Person against Parent to the
      effect that such Person is entitled to acquire or receive any shares of
      capital stock or other securities of Parent.

	 	 	 
	2.4 	
      SEC Filings; Financial Statements; Books and
      Records

	 	 	 
		(a) 	
      Parent has delivered or made available to the Company
      accurate and complete copies (including exhibits) of the Parent SEC
      Documents. All statements, reports, schedules, forms and other documents
      required to have been filed by Parent with the SEC have been so filed on a
      timely basis. As of the time it was filed with the SEC (or, if amended or
      superseded by a filing prior to the date of the Agreement, then on the
      date of such filing): (i) each of the Parent SEC Documents complied in all
      material respects with the applicable requirements of the Securities Act
      or the Exchange Act (as the case may be); and (ii) none of the Parent SEC
      Documents contained any untrue statement of a material fact or omitted to
      state a material fact required to be stated therein or necessary in order
      to make the statements therein, in the light of the circumstances under
      which they were made, not misleading.

	 	 	 
		(b) 	
      Except as set out in the Parent Disclosure Schedule, the
      consolidated financial statements contained in the Parent SEC Documents
      (including the notes thereto): (i) complied as to form in all material
      respects with the published rules and regulations of the SEC applicable
      thereto; (ii) were prepared in accordance with United States generally
      accepted accounting principles applied on a consistent basis throughout
      the periods covered (except as may be indicated in the notes to such
      financial statements and except as disclosed in Parent’s current report on
      Form 8-K filed with the SEC on May 15, 2007 and, in the case of unaudited
      statements, as permitted by Form 10-QSB of the SEC, and except that
      unaudited financial statements may not contain footnotes and are subject
      to normal and recurring year-end audit adjustments which will not,
      individually or in the aggregate, be material in amount); and (iii) fairly
      present the consolidated financial position of Parent and its consolidated
      subsidiaries as of the respective dates thereof and the consolidated
      results of operations of Parent and its consolidated subsidiaries for the
      periods covered thereby.

	 	 	 
		(c) 	
      The books, records and accounts of Parent, in all
      material respects, (i) have been maintained in accordance with good
      business practices consistent with prior years, (ii) are stated in
      reasonable detail and accurately and fairly reflect the transactions and
      dispositions of the assets of Parent, and (iii) accurately and fairly
      reflect the basis for the financial statements referred to in Section
      2.4(b) of this Schedule C. Parent has devised

C-3 

and maintains a system of internal
accounting controls sufficient to provide reasonable assurances that: (i)
transactions are executed in accordance with management’s general or specific
authorization; and (ii) transactions are recorded as necessary (A) to permit
preparation of financial statements in conformity with United States generally
accepted accounting principles or any other criteria applicable to such
statements and (B) to maintain accountability for assets. 

	2.5 	Absence of Changes 

     Between January 31, 2007 and the
date of the Agreement, except as set out in the Parent SEC Documents and except
as contemplated herein: 

	 	(a) 	
      no event, violation, circumstance or other matter has
      occurred or arisen that, in combination with any other events or
      circumstances, has had or would reasonably be expected to have a Material
      Adverse Effect on Parent;

	 	 	 
	 	(b) 	
      there has not been any material loss, damage or
      destruction to, or any material interruption in the use of, any of the
      assets of Parent (whether or not covered by insurance);

	 	 	 
	 	(c) 	
      Parent has not: (i) declared, accrued, set aside or paid
      any dividend or made any other distribution in respect of any shares of
      Parent Common Stock, or (ii) repurchased, redeemed or otherwise reacquired
      any shares of Parent Common Stock or other securities;

	 	 	 
	 	(d) 	
      except as contemplated herein, Parent has not sold,
      issued or granted, or authorized the issuance of, (i) any shares of Parent
      Common Stock, capital stock or other security (except for shares of Parent
      Common Stock issued upon the valid exercise of outstanding stock options
      to purchase shares of Parent Common Stock or upon conversion of
      outstanding convertible debentures), (ii) any option, warrant or right to
      acquire any shares of Parent Common Stock, capital stock or any other
      security (except for stock options identified in Section 2.3 of Schedule
      C), or (iii) any instrument convertible into or exchangeable for any
      shares of Parent Common Stock, capital stock or other security;

	 	 	 
	 	(e) 	
      Parent has not amended or waived any of its rights under,
      or permitted the acceleration of vesting under, (i) any provision of any
      of Parent’s 2004 and 2005 Stock Option Plans, or (ii) any provision of any
      Contract evidencing any outstanding stock option of Parent other than as
      set forth in the Parent Disclosure Schedule;

	 	 	 
	 	(f) 	
      except as contemplated in this herein, there has been no
      amendment to the certificate of incorporation, articles, bylaws or other
      charter or organizational documents of Parent, and Parent has not effected
      or been a party to any merger, amalgamation, arrangement, consolidation,
      share exchange, business combination, recapitalization, reclassification
      of shares, stock split, reverse stock split or similar
  transaction;

	 	 	 
	 	(g) 	
      except as contemplated herein, Parent has not formed any
      Subsidiary or acquired any equity interest or other interest in any other
      Entity;

	 	 	 
	 	(h) 	
      Parent has not made any capital expenditure which,
      between January 31, 2007 and the date of the Agreement, exceeds $100,000
      in the aggregate;

C-4 

	 	(i) 	
      except as disclosed in the Parent SEC Documents, Parent
      has not (i) entered into or permitted any of the assets owned or used by
      it to become bound by any Parent Material Contract except in the ordinary
      course of business and consistent with past practices, or (ii) 
      amended or terminated, or waived any material right or remedy under, any
      Parent aterial Contract;

	 	 	 	 
	 	(j) 	
      except as disclosed in the Parent SEC Documents, Parent
      has not (i) acquired, leased or licensed any material right or other
      material asset from any other Person except in the ordinary course of
      business and consistent with past practices, (ii) sold or otherwise
      disposed of, or leased or licensed, any material right or other material
      asset to any other Person, or (iii) waived or relinquished any material
      right;

	 	 	 	 
	 	(k) 	
      Parent has not written off as uncollectible, or
      established any extraordinary reserve with respect to, any account
      receivable or other indebtedness having a value in excess of $150,000 in
      any individual case;

	 	 	 	 
	 	(l) 	
      Parent has not made any pledge of any of its assets or
      otherwise permitted any of its assets to become subject to any
      Encumbrance, except for pledges of immaterial assets made in the ordinary
      course of business and consistent with past practices;

	 	 	 	 
	 	(m) 	
      Parent has not (i) lent money to any Person, or (ii)
      guaranteed any indebtedness for borrowed money;

	 	 	 	 
	 	(n) 	
      except as disclosed in the Parent SEC Documents has not
      (i) adopted, established or entered into any Parent Employee Plan (as
      defined in Section 2.16 of Schedule C), (ii) caused or permitted any
      Parent Employee Plan to be amended in any material respect, or (iii) paid
      any bonus or made any profit-sharing or similar payment to, or materially
      increased the amount of the wages, salary, commissions, fringe benefits or
      other compensation or remuneration payable to, any of its directors,
      officers or employees, other than in the normal course of business and
      consistent with past practices;

	 	 	 	 
	 	(o) 	
      Parent has not changed any of its methods of accounting
      or accounting principles or practices in any respect, except as otherwise
      required by United States generally accepted accounting
  principles;

	 	 	 	 
	 	(p) 	
      Parent has not commenced or settled any Legal
      Proceeding;

	 	 	 	 
	 	(q) 	
      Parent has not entered into any material transaction or
      taken any other material action that, either individually or in the
      aggregate, has had, or could reasonably be expected to have, a Material
      Adverse Effect on Parent;

	 	 	 	 
	 	(r) 	
      Parent has not entered into any material transaction or
      taken any other material action outside the ordinary course of business or
      inconsistent with past practices; and

	 	 	 	 
	 	(s) 	
      Parent has not agreed or committed to take any of the
      actions referred to in clauses “(c)” through “(r)”
above.

	2.6 	Title to Assets 

     Except as set out in the Parent
SEC Documents, Parent owns, and has good and valid title to, all assets
purported to be owned by it, including: (i) all assets reflected on the Parent
Audited Balance Sheet 

C-5 

and the Parent Unaudited Balance Sheet; and (ii) all other
assets reflected in the books and records of Parent as being owned by Parent.
All of said assets are owned by Parent free and clear of any Encumbrances,
except for (1) any lien for current taxes not yet due and payable, and (2) minor
liens that have arisen in the ordinary course of business and that do not (in
any case or in the aggregate) materially detract from the value of the assets
subject thereto or materially impair the operations of Parent. 

	2.7 	Receivables; Employee Loans; Advances
  

	 	(a) 	
      All existing accounts receivable of Parent (including
      those accounts receivable reflected on the Parent Unaudited Balance Sheet
      that have not yet been collected and those accounts receivable that have
      arisen since the date thereof and have not yet been collected) (a)
      represent valid obligations of customers of Parent arising from bona fide
      transactions entered into in the ordinary course of business, (b) are
      current and will, to the knowledge of Parent, be collected in full,
      without any counterclaim or set off except as are contemplated by Section
      2.5(k) of this Agreement.

	 	 	 
	 	(b) 	
      The Parent Disclosure Schedule contains an accurate and
      complete list of all outstanding loans and advances made by Parent to any
      employee, director, consultant or independent contractor, other than
      routine travel, meal and related advances made to employees in the
      ordinary course of business.

	2.8 	Real Property; Equipment; Leasehold
  

     All material items of equipment
and other tangible assets owned by or leased to Parent are adequate for the uses
to which they are being put, are in good and safe condition and repair (ordinary
wear and tear excepted) and are adequate for the conduct of the business of
Parent in the manner in which such business is currently being conducted. Parent
does not own any real property or any interest in real property, except for: the
leaseholds created under the real property leases identified in the Parent SEC
Documents. 

	2.9 	
      Proprietary Assets.

	 	 	 
		(a) 	
      The Parent SEC Documents, with respect to each
      Proprietary Asset owned by Parent and registered with any Governmental
      Body or for which an application has been filed with any Governmental Body
      sets out, (i) a brief description of such Proprietary Asset, and (ii) the
      names of the jurisdictions covered by the applicable registration or
      application that is material to business of Parent. Parent has good and
      valid title to all of the Proprietary Assets identified or required to be
      identified in the Parent SEC Documents, free and clear of all
      Encumbrances, except for any lien for current taxes not yet due and
      payable, and minor liens that have arisen in the ordinary course of
      business and that do not (individually or in the aggregate) materially
      detract from the value of such Proprietary Asset subject thereto or
      materially impair the operations of Parent. Parent has a valid right to
      use, license and otherwise exploit all Proprietary Assets identified or
      required to be identified in the Parent SEC Documents. Parent has a valid
      right to use, license and exploit any Parent Proprietary Asset identified
      above, subject to the terms thereof. Parent has not developed jointly with
      any other Person any Proprietary Asset that is material to the business of
      Parent and with respect to which such other Person has any rights. There
      is no Parent Contract (with the exception of end user license agreements,
      support agreements, consulting agreements and other customer contracts in
      the forms previously filed in the Parent SEC Documents) pursuant to which
      any Person has any right (whether

C-6 

	 		
      or not currently exercisable) to use, license or
      otherwise exploit any Proprietary Asset of Parent.

	 	 	 
	 	(b) 	
      Parent has taken reasonable measures and precautions to
      protect and maintain the confidentiality, secrecy and value of all
      material Proprietary Assets of Parent (except Proprietary Assets of Parent
      whose value would be unimpaired by disclosure). No current or former
      employee, officer, director, shareholder, consultant or independent
      contractor has any right, claim or interest in or with respect to any
      Proprietary Asset of Parent.

	 	 	 
	 	(c) 	
      All patents, trademarks, service marks and copyrights
      held by Parent are valid, enforceable and subsisting and none of the
      Proprietary Assets of Parent and no Proprietary Asset that is currently
      being developed by Parent (either by itself or with any other Person), to
      the Parent’s knowledge, infringes, misappropriates or conflicts with any
      Proprietary Asset owned or used by any other Person. Except as disclosed
      in the Parent SEC Documents, Parent has not received any notice or other
      communication (in writing or otherwise) of any actual, alleged, possible
      or potential infringement, misappropriation or unlawful or unauthorized
      use of, any Proprietary Asset owned or used by any other Person. To the
      best of the knowledge of Parent, no other Person is materially infringing,
      misappropriating or making any unlawful or unauthorized use of, and no
      Proprietary Asset owned or used by any other Person infringes or conflicts
      with, any material Proprietary Asset of Parent.

	 	 	 
	 	(d) 	
      The Proprietary Assets of Parent constitute all the
      Proprietary Assets necessary to enable Parent to conduct its business in
      the manner in which such business has been and is being conducted. Parent
      has not (i) licensed any Proprietary Assets of Parent to any Person on an
      exclusive basis, or (ii) entered into any covenant not to compete or
      Contract limiting or purporting to limit the ability of Parent to exploit
      fully any Proprietary Assets of Parent or to transact business in any
      market or geographical area or with any
Person.

	2.10 	
      Contracts.

	 	 	 	 
		(a) 	
      Part 2.10 of the Parent Disclosure Schedule identifies
      each Contract that constitutes a “Parent Material Contract” of or to
      Parent. For purposes of the Agreement, each of the following shall be
      deemed to constitute a “Parent Material Contract”:

	 	 	 	 
			(i) 	
      any Contract (A) relating to the employment of, or the
      performance of services by, any employee or consultant, (B) pursuant to
      which Parent is or may become obligated to make any severance,
      termination, change in control or similar payment to any current or former
      employee or director, or (C) pursuant to which Parent is or may become
      obligated to make any bonus or similar payment (other than payments
      constituting base salary or normal commissions) in excess of Cdn$10,000 to
      any current or former employee or director;

	 	 	 	 
			(ii) 	
      any material Contract relating to the acquisition,
      transfer, development, sharing or license of any Proprietary Asset (except
      for any Contract pursuant to which (A) any Proprietary Asset is licensed
      to the Parent under any third party software license generally available
      to the public, (B) any Proprietary Asset which is not material to Parent’s
      business and is licensed by Parent to any Person on a non- exclusive basis
      or (C) any Proprietary Asset which is licensed as part of a sale of the
      Parent’s products in the ordinary course of
business);

C-7 

	 	(iii) 	
      any Contract pursuant to which (a) any monies have been
      loaned to Parent, or (B) Parent has granted a security interest in any of
      its assets;

	 	 	 
	 	(iv) 	
      any Contract imposing any restriction on the right or
      ability of Parent to compete with any other Person;

	 	 	 
	 	(v) 	
      any Contract (other than Contracts evidencing options to
      purchase Parent Common Stock) (A) relating to the acquisition, issuance,
      voting, registration, sale or transfer of any securities, (B) providing
      any Person with any pre-emptive right, right of participation, or similar
      right with respect to any securities, or (C) providing Parent with any
      right of first refusal with respect to, or right to repurchase or redeem,
      any securities;

	 	 	 
	 	(vi) 	
      any Contract incorporating or relating to any guarantee,
      any warranty or any indemnity or similar obligation, except for Contracts
      substantially identical to the end-user licenses, support agreements,
      consulting agreements and other customer contracts;

	 	 	 
	 	(vii) 	
      any Contract containing “standstill” or similar
      provisions;

	 	 	 
	 	(viii) 	
      any Contract (A) to which any Governmental Body is a
      party or under which any Governmental Body has any rights or obligations,
      or (B) directly or indirectly benefiting any Governmental Body (including
      any subcontract or other Contract between Parent and any contractor or
      subcontractor to any Governmental Body);

	 	 	 
	 	(ix) 	
      any Contract requiring that Parent give any notice or
      provide any information to any Person prior to considering or accepting
      any Acquisition Proposal or similar proposal, or prior to entering into
      any discussions, agreement, arrangement or understanding relating to any
      Acquisition Transaction or similar transaction;

	 	 	 
	 	(x) 	
      any Contract that contemplates or involves the guaranteed
      payment or delivery of cash or other consideration in an amount or having
      a value in excess of $50,000 in the aggregate or the payment of such
      consideration any time between the Effective Date and the date of the
      Agreement, or contemplates or involves the performance of services having
      a value in excess of $50,000 in the aggregate; and

	 	 	 
	 	(xi) 	
      any Contract that is otherwise material to Parent and out
      of the ordinary course of business, including any Contract that could
      reasonably be expected to have a material effect on the ability of Parent
      to perform any of its obligations under, or to consummate any of the
      transactions contemplated by, the Agreement.

	 		
      Parent has delivered or made available to the Company an
      accurate and complete copy of any Contract that constitutes a Parent
      Material Contract of or to the Acquired Corporations.

	 	 	 
	 	(b) 	
      Each Contract that constitutes a Parent Material Contract
      is valid and in full force and effect, and is enforceable in accordance
      with its terms, subject to (i) laws of general application relating to
      bankruptcy, insolvency and the relief of debtors, and (ii) rules of law
      governing specific performance, injunctive relief and other equitable
      remedies.

C-8 

	 	(c) 	
      Parent has not violated or breached, or committed any
      default in any material respect under, any Contract and, to the best of
      the knowledge of Parent, no other Person has violated or breached, or
      committed any default under, any Contract. To the best of the knowledge of
      the Company, no event has occurred, and no circumstance or condition
      exists, that (with or without notice or lapse of time) could reasonably be
      expected to (A) result in a violation or breach of any of the provisions
      of any Contract, (B) give any Person the right to declare a default or
      exercise any remedy under any Contract, (C) give any Person the right to
      receive or require a rebate, chargeback, penalty or change in delivery
      schedule under any Contract, (D) give any Person the right to accelerate
      the maturity or performance of any Contract, or (E) give any Person the
      right to cancel, terminate or modify any Contract. Since January 31, 2007,
      Parent has not received any notice or other communication regarding any
      actual or possible violation or breach of, or default under, any material
      Contract.

	2.11 	Liabilities 

     Parent has no accrued, contingent
or other liabilities of any nature, either matured or unmatured, except for: (a)
liabilities identified as such in the “liabilities” column of Parent Unaudited
Balance Sheet; and (b) normal and recurring current liabilities that have been
incurred by Parent since the date thereof in the ordinary course of business and
consistent with past practices. 

	2.12 	Compliance with Legal Requirements
  

     To the knowledge of Parent,
Parent is, and has at all times been, in compliance in all material respects
with all applicable Legal Requirements. Since January 31, 2007, Parent has not
has received any notice or other communication from any Governmental Body or
other Person regarding any actual or possible material violation of, or failure
to comply with, any Legal Requirement. 

	2.13 	Certain Business Practices

     There is no Contract, judgment,
injunction, order or decree binding upon Parent that has or could reasonably be
expected to have the effect of prohibiting, restricting or materially impairing
any business practice of Parent, any acquisition of property by Parent or the
conduct of business by Parent as currently conducted. 

	2.14 	Governmental Authorizations.
  

     Parent holds all Governmental
Authorizations necessary to enable Parent to conduct its business in the manner
in which such business is currently being conducted. All such Governmental
Authorizations are valid and in full force and effect. Parent is in substantial
compliance with the terms and requirements of such Governmental Authorizations.
Parent has not received any notice or other communication from any Governmental
Body regarding (a) any actual or possible violation of or failure to comply with
any term or requirement of any material Governmental Authorization, or (b) any
actual or possible revocation, withdrawal, suspension, cancellation, termination
or modification of any material Governmental Authorization. No Governmental Body
has at any time challenged in writing the right of Parent to design,
manufacture, offer or sell any of its respective products or services. 

	2.15 	Tax Matters 

	 	(a) 	
      Except as disclosed in the Parent Disclosure Schedule,
      each of the Tax Returns required to be filed by or on behalf of Parent
      with any Governmental Body with respect to any

C-9 

	 		
      taxable period ending on or before the Closing Date (the
      “Parent Returns”) (i) has been or will be filed on or before the
      applicable due date (including any extensions of such due date and with
      the possible exception of the filing of the appropriate Tax Returns in
      Canada and payment of any tax thereon), and (ii) has been, or will be when
      filed, prepared in all material respects in compliance with all applicable
      Legal Requirements and will be true and correct in all material respects.
      All amounts shown on the Parent Returns to be due on or before the Closing
      Date have been or will be paid on or before the Closing Date except as
      disclosed herein. All Taxes required to be withheld or collected have been
      and will continue to be withheld and paid or remitted on or before the
      applicable due date up to and before the Closing Date.

	 	 	 
	 	(b) 	
      Parent Unaudited Interim Balance Sheet fully accrues all
      actual and contingent liabilities for Taxes with respect to all periods
      through to the date thereof in accordance with United States generally
      accepted accounting principles. Parent will establish, in the ordinary
      course of business and consistent with its past practices, reserves
      adequate for the payment of all Taxes for the period from the date thereof
      through the Closing Date.

	 	 	 
	 	(c) 	
      No claim, Legal Proceeding adjustment, assessment or
      reassessment is pending or, to the best of the knowledge of Parent, has
      been threatened, either formally or informally, against or with respect to
      Parent in respect of any Tax. There are no unsatisfied liabilities for
      Taxes (including related expenses) with respect to any notice of
      assessment or reassessment or similar document received by Parent with
      respect to any Tax (other than liabilities for Taxes asserted under any
      such notice of assessment or reassessment or similar document which are
      being contested in good faith by Parent and with respect to which adequate
      reserves for payment have been established on the Parent Unaudited Balance
      Sheet). There are no liens for Taxes upon any of the assets of Parent
      except liens for current Taxes not yet due and payable. Parent has not
      entered into or become bound by any agreement or consent pursuant to
      Section 341(f) of the Code (or any comparable provision of state or
      foreign Tax laws). Parent has not been, and Parent will not be, required
      to include any adjustment in taxable income for any tax period (or portion
      thereof) pursuant to Section 481 or 263A of the Code (or any comparable
      provision of state or foreign Tax laws) as a result of transactions or
      events occurring, or accounting methods employed, prior to the Closing.
      Parent has not made any distribution of stock of any controlled
      corporation, as that term is defined in Section 355(a)(1) of the
    Code.

	 	 	 
	 	(d) 	
      Parent is in full compliance with all terms and
      conditions of any Tax exemptions, Tax holiday or other Tax reduction
      agreement or order of any Governmental Body and the consummation of the
      Arrangement will have no adverse effect on the continued validity and
      effectiveness of any such Tax exemptions, Tax holiday or other Tax
      reduction agreement or order.

	2.16 	
      Employee and Labor Matters; Benefit
  Plans.

	 	 	 
		(a) 	
      The Parent SEC Documents identify, or as delivered or
      made available to the Company by the Parent, each salary, bonus, vacation,
      deferred compensation, incentive compensation, stock purchase, stock
      option, severance pay, termination pay, death and disability benefits,
      hospitalization, medical, life or other insurance, flexible benefits,
      supplemental unemployment benefits, profit-sharing, pension or retirement
      plan, program or agreement and each other employee benefit plan or
      arrangement (collectively, the “Parent Employee Plans”) sponsored,
      maintained, contributed to or required to be contributed to by Parent for
      the benefit of any current or former employee of Parent.
  The

C-10 

	 		
      Parent SEC Documents contain accurate and complete copies
      of the Parent Employee Plans currently in force and all amendments thereto
      together with, as applicable, accurate and complete copies of all funding
      agreements and any Contracts relating to such Parent Employee Plans
      (including service provider agreements, insurance contracts, minimum
      premium contracts, stop-loss agreements, investment management agreements,
      subscription and participation agreements and recordkeeping agreements),
      all summary descriptions of the Parent Employee Plans provided to past or
      present participants therein, any annual information returns required to
      be filed under a Legal Requirement, the financial statements, if any, and
      evidence of any registration in respect thereof.

	 	 	 
	 	(b) 	
      All of the Parent Employee Plans are, and have been since
      their establishment, duly registered where required by Legal Requirement
      (including registration with the relevant tax authorities where such
      registration is required to qualify for tax exemption or other beneficial
      tax status) and are in good standing under, and in compliance with, all
      Legal Requirements.

	 	 	 
	 	(c) 	
      All Parent Employee Plans have been administered in
      accordance with their terms, there are no outstanding defaults or
      violations by Parent of any obligation required to be performed by it in
      connection with any Parent Employee Plan and no order has been made or
      notice given pursuant to any Legal Requirements requiring (or proposing to
      require) Parent to take (or refrain from taking) any action in respect of
      any Parent Employee Plan.

	 	 	 
	 	(d) 	
      There are no actions, suits, claims, trials, demands,
      investigations, arbitrations or other proceedings pending or, to the
      knowledge of Parent threatened with respect to the Parent Employee Plans
      against Parent, the funding agent, the insurers or the fund of such Parent
      Employee Plans, other than claims for benefits in the ordinary
    course.

	 	 	 
	 	(e) 	
      Except as disclosed in the Parent Disclosure Schedule,
      neither the execution, delivery or performance of the Agreement, nor the
      consummation of the Arrangement or any of the other transactions
      contemplated by the Agreement, will result in any bonus, golden parachute,
      severance or other payment or obligation to any current or former employee
      or director of Parent (whether or not under any Parent Employee Plan), or
      materially increase the benefits payable or provided under any Parent
      Employee Plan, or result in any acceleration of the time of payment or
      vesting of any such benefits. Without limiting the generality of the
      foregoing, the consummation of the Arrangement will not result in the
      acceleration of vesting of any unvested stock options to purchase shares
      of Parent Common Stock.

	 	 	 
	 	(f) 	
      Parent is not a party to any collective bargaining
      agreement with a trade union or council of trade unions. No trade union,
      council of trade unions, employee bargaining agency or affiliated
      bargaining agent holds bargaining rights with respect to Parent’s
      employees by way of certification, interim certification, voluntary
      recognition, designation or successor rights, has applied to be certified
      as a bargaining agent of Parent’s employees or has applied to have Parent
      declared a related employer pursuant to applicable labor, employment or
      similar laws. All of the employees of Parent are employed for an
      indefinite term and the employment of such employees may be terminated on
      reasonable notice.

	 	 	 
	 	(g) 	
      Parent is in compliance in all material respects with all
      applicable Legal Requirements and Contracts relating to employment,
      employment standards, employment practices,

C-11 

	 		
      wages, bonuses, benefits and terms and conditions of
      employment, including employee compensation matters.

	 	 	 
	 	(h) 	
      All amounts owing in respect of employee payroll
      withholding obligations, remittances, premiums, contributions and
      assessments under provincial or federal statutes or employee benefit plans
      have been fully accrued in the books and records of Parent and wages,
      vacation pay, holiday pay and employee benefits of the employees of Parent
      have been fully accrued in Parent’s books and records and reflected as
      such in Parent’s financial statements.

	2.17 	Insurance 

     Parent has delivered or made
available to the Company a copy of all material insurance policies and all
material self insurance programs and materials relating to the business, assets
and operations of Parent. Each of such insurance policies is in full force and
effect. Parent has not received any notice or other communication regarding any
actual or possible (a) cancellation or invalidation of any insurance policy, (b)
refusal of any coverage or rejection of any material claim under any insurance
policy, or (c) material adjustment in the amount of the premiums payable with
respect to any insurance policy. There is no pending workers’ compensation or
other claim under or based upon any insurance policy of Parent. 

	2.18 	
      Legal Proceedings; Orders.

	 	 	 
		(a) 	
      Except as disclosed in the Parent SEC Documents, there is
      no pending Legal Proceeding, and to the best of the knowledge of Parent,
      no Person has threatened to commence any Legal Proceeding: (i) that
      involves Parent or any of the assets owned or used by Parent; or (ii) that
      challenges, or that may have the effect of preventing, delaying, making
      illegal or otherwise interfering with, the Arrangement or any of the other
      transactions contemplated by the Agreement. To the best of the knowledge
      of Parent, no event has occurred, and no claim, dispute or other condition
      or circumstance exists that could reasonably be expected to, give rise to
      or serve as a basis for the commencement of any such Legal
    Proceeding.

	 	 	 
		(b) 	
      There is no order, writ, injunction, judgment or decree
      to which Parent, or any of the assets owned or used by Parent, is subject.
      To the best of the knowledge of Parent, no officer or key employee of
      Parent is subject to any order, writ, injunction, judgment or decree that
      prohibits such officer or other employee from engaging in or continuing
      any conduct, activity or practice relating to the business of
    Parent.

	 	 	 
	2.19 	
      Authority; Binding Nature of
  Agreement

     Parent has the requisite
corporate power and authority to enter into and to perform its obligations under
the Agreement. The board of directors of Parent (at a meeting duly called and
held) has (a) unanimously determined that the Arrangement is fair to Parent
Securityholders and in the best interests of Parent, and (b) unanimously
authorized and approved the execution, delivery and performance of the Agreement
by Parent and unanimously approved the Arrangement. The Agreement constitutes
the legal, valid and binding obligations of Parent, enforceable against the
Parent in accordance with its terms, subject to (i) laws of general application
relating to bankruptcy, insolvency and any similar law relating to creditors’
rights, and (ii) rules of law governing specific performance, injunctive relief
and other equitable remedies. 

C-12 

	2.20 	Vote Not Required 

     Except as otherwise contemplated
herein, no vote of the securityholders of Parent is necessary to approve the
execution and delivery of the Agreement or the consummation of the transactions
contemplated herein.

	2.21 	Non-Contravention; Consents
  

     Neither (1) the execution,
delivery or performance of the Agreement, nor (2) the consummation by Parent of
the Arrangement or any of the other transactions contemplated by the Agreement,
will directly or indirectly (with or without notice or lapse of time): 

	 	(a) 	
      contravene, conflict with or result in a violation of (i)
      any of the provisions of the articles or certificate of incorporation,
      bylaws or other charter or organizational documents of Parent, or (ii) any
      resolution adopted by the shareholders, the board of directors or any
      committee of the board of directors of Parent;

	 	 	 
	 	(b) 	
      subject to obtaining the Consents set forth in Section
      7.4 of the Agreement, contravene, conflict with or result in a violation
      of any Legal Requirement or any order, writ, injunction, judgment or
      decree to which Parent, or any of the assets owned or used by Parent, is
      subject;

	 	 	 
	 	(c) 	
      contravene, conflict with or result in a violation of any
      of the terms or requirements of, or give any Governmental Body the right
      to revoke, withdraw, suspend, cancel, terminate or modify, any
      Governmental Authorization that is held by Parent or that otherwise
      relates to the business of Parent or to any of the assets owned or used by
      Parent;

	 	 	 
	 	(d) 	
      to Parent’s knowledge, contravene, conflict with or
      result in a violation or breach of, or result in a default under, any
      provision of any material Contract of Parent, or give any Person the right
      to (i) declare a default or exercise any remedy under any such Contract of
      Parent, (ii) a rebate, chargeback, penalty or change in delivery schedule
      under any such Contract of Parent, (iii) accelerate the maturity or
      performance of any such Contract of Parent, or (iv) cancel, terminate or
      modify any term of such material Contract of Parent (other than with
      British Telecom);

	 	 	 
	 	(e) 	
      result in the imposition or creation of any Encumbrance
      upon or with respect to any asset owned or used by Parent (except for
      minor liens that will not, in any case or in the aggregate, materially
      detract from the value of the assets subject thereto or materially impair
      the operations of Parent); or

	 	 	 
	 	(f) 	
      result in, or increase the likelihood of, the disclosure
      or delivery to any escrowholder or other Person of any material asset of
      Parent to any Person.

	2.22 	No Broker or Finder 

     No broker, finder or investment
banker is entitled to any brokerage, finder’s or other fee or commission in
connection with the Arrangement or any of the other transactions contemplated by
the Agreement based upon arrangements made by or on behalf of Parent.

C-13 

	2.23 	Registration Rights 

     Except as contemplated herein or
as disclosed in the Parent Disclosure Schedule, no holder of securities issued
by Parent has any right to compel Parent to register or otherwise qualify such
securities for public sale in Canada or the United States. 

	2.24 	Full Disclosure 

     The Agreement (including the
Parent Disclosure Schedule and Parent SEC Documents) does not, and will not, (i)
contain any representation, warranty or information that is false or misleading
with respect to any material fact, or (ii) omit to state any material fact
necessary in order to make the representations, warranties and information
contained and to be contained herein and therein (in the light of the
circumstances under which such representations, warranties and information were
or will be made or provided) not false or misleading. 

	2.25 	
      Cash and Receivables

	 	 	 
		(a) 	
      At the Effective Time, Parent will have a combination of
      cash and accounts receivable of not less than $4.0 million including cash
      raised in accordance with Section 5.8 and Section 7.11(b) of the Agreement
      (but not including any funds to be raised pursuant to the Wesley Clover
      Subscription Agreement).

	 	 	 
		(b) 	
      Parent will have received the subscription and funds from
      KMB Trac Two Holdings Ltd. to purchase $1.0 million worth of Parent Common
      Stock conditional on and to be contemplated immediately following the
      Closing.

	 	 	 
		(c) 	
      On or before the Effective Time, holders representing not
      less than $3.0 million of Parent’s outstanding convertible debt will, in
      accordance with the terms thereof, be converted to Parent Common
    Stock.

	
SCHEDULE D
	
	 

	
	
TO THE ARRANGEMENT AGREEMENT AMONG
	
	
COUNTERPATH SOLUTIONS, INC, 6789722 CANADA INC. AND
	
	
NEWHEIGHTS SOFTWARE CORPORATION
	
	 

	
	
PLAN OF ARRANGEMENT
	

	PLAN OF ARRANGEMENT INCLUDING EXCHANGEABLE SHARE PROVISIONS
    
	  
	PLAN OF ARRANGEMENT 
	UNDER SECTION 192 
	OF THE CANADA BUSINESS CORPORATIONS ACT
    
	  
	ARTICLE 1 
	INTERPRETATION 

	1.1 	Definitions 

     In this Plan of Arrangement, unless
  there is something in the subject matter or context inconsistent therewith,
  the following terms shall have the respective meanings set out below and grammatical
  variations of such terms shall have corresponding meanings: 

     “Affiliate” of
  any Person means any other Person directly or indirectly controlling, controlled
  by, or under common control with, that Person. For the purposes of this definition,
  “control” (including, with correlative meanings, the terms “controlled
  by” and “under common control with”), as applied to any Person,
  means the possession by another Person, directly or indirectly, of the power
  to direct or cause the direction of the management and policies of that first
  mentioned Person, whether through the ownership of voting securities, by contract
  or otherwise. 

     “Arrangement”
  means the arrangement under Section 192 of the CBCA on the terms and subject
  to the conditions set forth in the Arrangement Agreement and this Plan of Arrangement
  and subject to any amendments or variations thereto made in accordance with
  Section 9.1 of the Arrangement Agreement or Article 6 hereof or made at the
  direction of the Court in the Final Order. 

     “Arrangement Agreement”
  means the agreement made as of June 15, 2007 between Parent, ExchangeCo and
  the Company, as amended, supplemented and/or restated in accordance therewith
  providing for, among other things, the Arrangement. 

     “Arrangement Resolution”
  means the resolution to be passed by the Company Securityholders at the Company
  Securityholders’ Meeting in accordance with the Final Order. 

     “Articles of Arrangement”
  means the articles of arrangement of the Company in respect of the Arrangement,
  required by Section 192 of the CBCA to be sent to the Director after the Final
  Order is made. 

     “Business Day”
  means any day on which commercial banks are generally open for business in Vancouver,
  British Columbia, other than a Saturday, a Sunday or a day observed as a holiday
  in Vancouver, British Columbia under the laws of the Province of British Columbia
  or the federal laws of Canada. 

     “Canadian Resident”
  means a Person who is a resident of Canada for the purposes of the ITA. 

     “CBCA” means the
  Canada Business Corporations Act, R.S.C. 1985, c. C-44, and the regulations
  made thereunder, as amended. 

     “Certificate”
  means the certificate of arrangement giving effect to the Arrangement, issued
  by the Director pursuant to subsection 192(7) of the CBCA after the Articles
  of Arrangement have been received by the Director. 

     “Common Shares”
  means the common shares in the capital of the Company outstanding from time
  to time, including all common shares issued on the exercise of Company Options
  and Company Notes prior to the effective date. 

     “Company” means
  NewHeights Software Corporation, a corporation existing under the CBCA. 

      “Company Option”
  means an option to purchase Common Shares granted under the Company’s Stock
  Option Plan. 

     “Company Securityholders”
  means, collectively, the holders of Common Shares and the holders of Company
  Options to the extent provided in or required by the Interim Order. 

     “Company Securityholders
  Meeting” means the special meeting of the Company Securityholders (including
  any adjournment thereof) that is to be convened as provided by the Interim Order
  to consider, and if deemed advisable to approve, the Arrangement. 

     “Company Shareholder”
  means a registered holder of Common Shares. 

     “Court” means the Supreme
  Court of British Columbia. 

     “Current Market Price”
  has the meaning ascribed to that term in the Exchangeable Share Provisions.

     “Director” means the
  Director appointed under Section 260 of the CBCA.

     “Dissent Procedures”
  has the meaning ascribed to that term in Section 3.1. 

     “Dissenting Shareholder”
  means a holder of Common Shares who dissents in respect of the Arrangement in
  strict compliance with the Dissent Procedures and the CBCA. 

     “Dividend Amount” has
  the meaning ascribed to that term in Section 5.1(a) . 

     “Effective Date”
  means the date upon which this Plan of Arrangement becomes effective as established
  by the date of issue shown on the Certificate. 

     “Effective Time” means
  12:01 a.m. (Vancouver Time) on the Effective Date. 

     “Election Deadline”
  means 5:00 p.m. (Vancouver Time) on the date which is two Business Days prior
  to the date of the Company Securityholders’ Meeting. 

     “Entity” means
  any corporation (including any non-profit corporation), general partnership,
  limited partnership, limited liability partnership, joint venture, estate, trust,
  company (including any company limited by shares, limited liability company
  or joint stock company), firm, society or other enterprise, association, organization
  or entity. 

     “Exchange Ratio”
  means the fraction determined by dividing 40,250,000 (forty million two hundred
  and fifty thousand) by the number of Common Shares issued and outstanding immediately

- 2 - 

prior to the Effective Time, provided that if, between the date
  of the Arrangement Agreement and the Effective Time, the outstanding Parent
  Common Stock are changed into a different number or class of shares by reason
  of any stock split, division or subdivision of shares, stock dividend, reverse
  stock split, consolidation of shares, reclassification, recapitalization or
  other similar transaction, then the Exchange Ratio will be adjusted appropriately
  by Parent and ExchangeCo after consultation with the Company. 

     “Exchangeable Elected Share”
  means any Common Share that the holder shall have elected, in a duly completed
  Letter of Transmittal and Election Form deposited with the Company no later
  than the Election Deadline, to transfer to ExchangeCo under the Arrangement
  in exchange for fully paid and non-assessable Exchangeable Shares. 

     “Exchangeable Share”
  means a share in the class of non-voting exchangeable shares in the capital
  of ExchangeCo. 

     “Exchangeable Share Provisions”
  means the rights, privileges, restrictions and conditions attaching to the Exchangeable
  Shares, which rights, privileges, restrictions and conditions shall be substantially
  as set forth in Appendix 1 hereto. 

     “Exchangeable Share Support
  Agreement” means the Exchangeable Share Support Agreement among Parent
  and ExchangeCo, to be entered into in connection with this Plan of Arrangement.

     “Exchangeable Share Voting
  Event” has the meaning attributed to that term in the Exchangeable
  Share Provisions. 

     “ExchangeCo” means
  6789722 Canada Inc., a corporation existing under the laws of Canada and being
  a direct, wholly-owned subsidiary of Parent. 

     “Final Order”
  means the final order of the Court made in connection with the approval of the
  Arrangement, following the application therefor contemplated by Section 1.1(c)
  of the Arrangement Agreement, as such order may be affirmed, amended or modified
  by the Court or by the highest court by which an appeal therefrom is heard at
  any time prior to the Effective Time. 

     “Governmental Body”
  means any: (a) nation, state, commonwealth, province, territory, county, municipality,
  district or other jurisdiction of any nature; (b) federal, state, provincial,
  local municipal, foreign or other government; or (c) governmental or quasi-governmental
  authority of any nature (including any governmental division, department, agency,
  commission, instrumentality, official, ministry, fund, foundation, center, organization,
  unit, body or Entity and any court or other tribunal). 

     “Interim Order”
  means the interim order of the Court made in connection with the process for
  obtaining approval of the Arrangement and related matters following the application
  therefor contemplated by Section 1.3 of the Arrangement Agreement. 

     “ITA” means the Income
  Tax Act (Canada). 

     “Letter of Transmittal
  and Election Form” means the Letter of Transmittal and Election Form
  for use by Company Shareholders, in exchanging their Common Shares and making
  such elections as provided under the Arrangement and which will be sent to such
  holders along with the Management Information Circular. 

- 3 - 

     “Liquidation Amount”
  has the meaning attributed to that term in the Exchangeable Share Provisions.

     “Liquidation Call Purchase
  Price” has the meaning ascribed to that term in Section 5.1(a) .

     “Liquidation Call Right”
  has the meaning ascribed to that term in Section 5.1(a) . 

     “Liquidation Date”
  has the meaning ascribed to that term in the Exchangeable Share Provisions.

     “Management Information
  Circular” means the notice of the Company Securityholders’ Meeting
  and accompanying management information circular of the Company, including all
  schedules attached thereto, to be sent to Company Securityholders in connection
  with the Company Securityholders’ Meeting. 

     “Meeting Date” means
  the date of the Company Securityholders’ Meeting.

     “OTC” means the
  National Association of Securities Dealer’s Inc. Over-the-Counter Bulletin
  Board. 

     “Parent” means
  CounterPath Solutions, Inc., a corporation existing under the laws of the State
  of Nevada, and includes any successor thereto. 

     “Parent Common Stock”
  means a share of common stock, par value U.S.$0.001 per share, in the capital
  of Parent, and any other security into which such share may be changed. 

     “Parent Control Transaction”
  has the meaning ascribed to that term in the Exchangeable Share Provisions.

     “Parent Elected Share”
  means any Common Share that (i) the holder shall have elected, in a duly completed
  Letter of Transmittal and Election Form deposited with the Company to transfer
  to Parent under the Arrangement in exchange for fully paid and non-assessable
  shares of Parent Common Stock, or (ii) in respect of which no election has been
  made, or (iii) in respect of which a valid Exchangeable Share Election has not
  been made in any Letter of Transmittal and Election Form deposited with the
  Company, or (iv) that is deemed to be a Parent Elected Share pursuant to Section
  2.2(a) or Section 2.2(b) . 

     “Person” means any
  individual, Entity or Governmental Body. 

     “Plan of Arrangement”
  means this plan of arrangement proposed under Section 192 of the CBCA, as amended,
  modified or supplemented from time to time in accordance with Article 6 hereof
  or Section 9.1 of the Arrangement Agreement or any order of the Court, including
  the appendices hereto and includes any agreement or instrument supplementary
  or ancillary hereto. 

     “Redemption Call Purchase
  Price” has the meaning ascribed to that term in Section 5.2(a) .

     “Redemption Call Right”
  has the meaning ascribed to that term in Section 5.2(a) . 

- 4 - 

     “Redemption Date”
  has the meaning ascribed to that term in the Exchangeable Share Provisions.

     “Redemption Price”
  has the meaning ascribed to that term in the Exchangeable Share Provisions.

     “Replacement Option”
  has the meaning ascribed to that term in Section 2.2(d) . 

     “Shareholders Agreement”
  means the Shareholders Agreement, dated as of July 13, 2004 and as amended
  from time to time, among the Company and the shareholders named therein. 

     “Special Voting Share”
  means the share of special voting stock of Parent, par value U.S.$0.001, having
  substantially the rights, privileges, restrictions and conditions described
  in the Voting and Exchange Trust Agreement. 

     “Trustee” means
  Valiant Trust Company or such other trust company or other Entity chosen by
  the Company and the Parent to act as trustee pursuant to Voting and Exchange
  Trust Agreement. 

     “U.S. Dollar Equivalent”
  means, in respect of an amount expressed in Canadian dollars at any date, the
  product obtained by multiplying: (a) the number of Canadian dollars, by (b)
  the noon spot exchange rate on such date for Canadian dollars expressed in United
  States dollars as reported by the Bank of Canada or, in the event such spot
  exchange rate is not available, such spot exchange rate on such date for Canadian
  dollars expressed in United States dollars as may be deemed by the board of
  directors of the Company and the board of directors of Parent, acting jointly
  and reasonably, to be appropriate for such purpose. 

     “Voting and Exchange Trust
  Agreement” has the meaning ascribed to that term in the Exchangeable
  Share Provisions. 

	1.2 	Sections and Headings 

     The division of this Plan of Arrangement
  into Articles and Sections and the insertion of headings are for convenience
  of reference only and shall not affect the construction or interpretation of
  this Plan of Arrangement. Unless otherwise indicated, any reference in this
  Plan of Arrangement to an article, a section or an appendix refers to the specified
  article or section of or appendix to this Plan of Arrangement. 

	1.3 	Number, Gender and Persons 

     In this Plan of Arrangement, unless
  the context otherwise requires, words importing the singular number include
  the plural and vice versa and words importing any gender include all genders.

	1.4 	Governing Law 

     This Plan of Arrangement will be
  governed by and construed in accordance with the laws of the Province of British
  Columbia and the laws of Canada applicable therein. 

- 5 - 

ARTICLE 2 

  ARRANGEMENT 

	2.1 	Binding Effect 

     This Plan of Arrangement will become
  effective at, and be binding at and after, the Effective Time on (i) the Company,
  (ii) Parent, (iii) ExchangeCo, (iv) all holders of Common Shares, (v) all holders
  of Exchangeable Shares and (vi) all holders of securities exercisable or exchangeable
  for or convertible into Common Shares, including Company Options. 

	2.1A 	Termination of Shareholders Agreement 

     The Shareholder Agreement shall
  be terminated, and thereafter, none of the parties thereto will have any rights,
  liabilities or other obligations thereunder. 

	2.2 	Arrangement 

     Commencing at the Effective Time,
  the following will occur and will be deemed to occur in the following order
  without any further act or formality: 

	 	(a) 	 each Exchangeable Elected Share will be transferred
        by the holder thereof, without any act or formality on the part of such
        holder, to ExchangeCo in exchange for (i) that number or fraction of a
        fully paid and non-assessable Exchangeable Share equal to the Exchange
        Ratio together with (ii) the rights and benefits to which such holder
        will be entitled pursuant to or as a result of the Voting and Exchange
        Trust Agreement and the Exchangeable Share Support Agreement, and the
        name of each such holder will be removed from the register of holders
        of Common Shares and added to the register of holders of Exchangeable
        Shares and ExchangeCo will be recorded as the registered holder of such
        Common Share so exchanged and will be deemed to be the legal and beneficial
        owner thereof; provided that, notwithstanding the foregoing, each holder
        of Common Shares who is not a Canadian Resident will not be entitled to
        elect to receive Exchangeable Shares, and any such election made by any
        such holder will be deemed to be an election to receive Parent Common
        Stock and each Common Share held by such holder will be deemed to be a
        Parent Elected Share;

	 	 	 
	 	(b) 	 each Common Share in respect of which an election has
        not been made by the holder thereof, or in respect of which an effective
        election has not been made, (other than (i) Common Shares held by Dissenting
        Shareholders who are ultimately entitled to be paid the fair value of
        the Common Shares held by them and (ii) Common Shares that are held by
        Parent or any of its Affiliates, which shall not be exchanged under this
        Arrangement and shall remain outstanding as Common Shares) will be deemed
        to be a Parent Elected Share and will be transferred by the holder thereof
        in accordance with Section 2.2(c);

	 	 	 
	 	(c) 	 each Parent Elected Share, (other than (i) Common Shares
        held by Dissenting Shareholders who are ultimately entitled to be paid
        the fair value of the Common Shares held by them, and (ii) Common Shares
        that are held by Parent or any of its Affiliates, which shall not be exchanged
        under this Arrangement and shall remain outstanding as Common Shares)
        will be transferred by the holder thereof to the Parent in exchange for
        that number or fraction of a fully paid and non-accessible Parent Common
        Stock equal to the Exchange Ratio, and the name of each such holder will
        be removed from the register

- 6 - 

			of holders of Common Shares and added to the register of holders of Parent
      Common Stock; and
	 	 	 
		(d) 	 each Company Option which is outstanding and unexercised
        immediately prior to the Effective Time, whether or not vested, will be
        exchanged for an option (a “Replacement Option”) to purchase
        a number of Parent Common Stock equal to the product of the Exchange Ratio
        multiplied by the number of Common Shares subject to such Company Option
        immediately prior to the Effective Time, rounding down to the nearest
        whole share, and such Replacement Option will provide for an exercise
        price per Parent Common Stock equal to U.S. $0.40 (regardless of the exercise
        price previously applicable to that Company Option). The term to expiry,
        conditions to, restrictions on and manner of exercising, exercisability,
        vesting schedule, and all other provisions of such Replacement Option
        will otherwise be unchanged from those of the Company Option as if any
        reference to the Company therein were a reference to the Parent. Parent
        shall be deemed to have assumed and adopted the Company’s obligations
        under each such Company Option and any document or agreement previously
        evidencing a Company Option will thereafter evidence and be deemed to
        evidence such Replacement Option; provided, however, that each Replacement
        Option issued in accordance with this Section 2.2(d) shall, in accordance
        with its terms, be subject to further adjustment as appropriate to reflect
        any stock split, division or subdivision of shares, stock dividend, reverse
        stock split, consolidation of shares, reclassification, recapitalization
        or other similar transaction subsequent to the Effective Time; and

	 	 	 
		(e) 	 coincident with the transactions set out above in this
        Section 2.2, Parent, ExchangeCo and the Trustee will execute the Voting
        and Exchange Trust Agreement and Parent will issue to and deposit with
        the Trustee the Special Voting Share, in consideration of the payment
        to Parent of US$1.00, to be thereafter held of record by the Trustee as
        trustee for and on behalf of, and for the use and benefit of, the holders
        of the Exchangeable Shares in accordance with the Voting and Exchange
        Trust Agreement. All rights of holders of Exchangeable Shares under the
        Voting and Exchange Trust Agreement will be received by them as part of
        the property receivable under Section 2.2(a) or Section 2.2(b) in exchange
        for the Common Shares.

	 	 	 
	2.3 	 Elections

	 	 	 
		(a) 	 Each Canadian Resident who, at or prior to the Election
        Deadline, is a holder of record of Common Shares, will be entitled, with
        respect to all or a portion of such shares, to make an election at or
        prior to the Election Deadline to receive Exchangeable Shares or Parent
        Common Stock, or a combination thereof, in exchange for such holder’s
        Common Shares, on the basis set forth herein and in the Letter of Transmittal
        and Election Form; for greater certainty, a holder of Common Shares who
        is not a Canadian Resident will not be entitled to elect to receive Exchangeable
        Shares, and any such election otherwise made by any such holder shall
        be and be deemed to be an election to receive Parent Elected Shares as
        set forth in Section 2.2(a).

	 	 	 
		(b) 	 Holders of Common Shares who are Canadian Residents,
        other than any such holder who is exempt from tax under the ITA, and who
        have elected to receive Exchangeable Shares will be entitled to make an
        income tax election pursuant to subsection 85(1) of the ITA (and the analogous
        provisions of applicable provincial income tax laws) with respect to the
        transfer of their Common Shares to ExchangeCo by providing three signed
        copies of the necessary election forms to the Company within 90 days following
        the Effective

- 7 - 

Date, duly completed with the details
  of the number of shares transferred and the applicable agreed amounts for the
  purposes of such elections. Thereafter, subject to the election forms complying
  with the provisions of the ITA (or any applicable provincial income tax laws),
  the forms will be signed by ExchangeCo and two signed copies will be returned
  to such holders for filing with the Canada Revenue Agency (or the applicable
  provincial taxing authority). 

ARTICLE 3 

  RIGHTS OF DISSENT 

	3.1 	Rights of Dissent 

     Holders of Common Shares may exercise
  rights of dissent with respect to such shares pursuant to and in the manner
  set forth in Section 190 of the CBCA and this Section 3.1 (the “Dissent
  Procedures”) in connection with the Arrangement; provided that, notwithstanding
  Subsection 190(5) of the CBCA, the written objection to the Arrangement Resolution
  referred to in Subsection 190(5) of the CBCA must be received by Parent not
  later than 5:00 p.m. (Vancouver time) on the Business Day preceding the Company
  Securityholders’ Meeting. Holders of Common Shares who duly exercise such
  rights of dissent and who: 

	 	(a) 	 are ultimately entitled to be paid fair value for their
        Common Shares will be deemed to have transferred such Common Shares to
        the Company immediately prior to the Effective Time, to the extent the
        fair value therefor is paid by the Company, and such shares will be cancelled
        as of the Effective Time; or

	 	 	 
	 	(b) 	 are ultimately not entitled, for any reason, to be paid
        fair value for their Common Shares will be deemed to have participated
        in the Arrangement on the same basis as a non- dissenting and non-electing
        holder of Common Shares and will receive Exchangeable Shares or Parent
        Common Stock, as the case may be, in accordance with Section 2.2(b),

but in no case will Parent, ExchangeCo or any other Person be
  required to recognize such holders as holders of Common Shares after the Effective
  Time, and the names of such holders of Common Shares will be deleted from the
  register of holders of Common Shares at the Effective Time. 

ARTICLE 4 

  CERTIFICATES AND FRACTIONAL SHARES 

	4.1 	Issuance of Certificates Representing Exchangeable
      Shares 

     At or promptly after the Effective
  Time, ExchangeCo will deposit with the Company, for the benefit of the holders
  of Common Shares who will receive Exchangeable Shares in connection with the
  Arrangement, certificates representing the Exchangeable Shares issued pursuant
  to Section 2.2(a) or Section 2.2(b) in exchange for Exchangeable Elected Shares.
  Upon surrender to the Company for cancellation of a certificate which immediately
  prior to the Effective Time represented one or more Exchangeable Elected Shares
  under the Arrangement, together with such other documents and instruments as
  would have been required to effect the transfer of the Common Shares formerly
  represented by such certificate under the CBCA and the by-laws of the Company
  and such additional documents and instruments as the Company may reasonably
  require, the holder of such surrendered certificate will be entitled to receive
  in exchange therefore, and the Company will deliver to such holder, a certificate
  representing that number (rounded down to the nearest whole number) of Exchangeable
  Shares which such holder has the right to receive (together with any dividends
  or distributions with 

- 8 - 

respect thereto pursuant to Section 4.3), and the certificate
  so surrendered will forthwith be cancelled. In the event of a transfer of ownership
  of Common Shares that is not registered in the transfer records of the Company,
  a certificate representing the proper number of Exchangeable Shares may be issued
  to the transferee if the certificate representing such Common Shares is presented
  to the Company, accompanied by all documents required to evidence and effect
  such transfer under the CBCA and the by-laws of the Company and such additional
  documents and instruments as the Company may reasonably require. Until surrendered
  as contemplated by this Section 4.1, each certificate which immediately prior
  to the Effective Time represented Exchangeable Elected Shares will be deemed
  at all times after the Effective Time to represent only the right to receive
  upon such surrender (i) the certificate representing Exchangeable Shares as
  contemplated by this Section 4.1, and (ii) any dividends or distributions with
  a record date after the Effective Time theretofore paid or payable with respect
  to Common Shares or Exchangeable Shares as contemplated by Section 4.3. 

	4.2 	Exchange of Certificates for Parent Common Stock
    

     Upon surrender to the Company for
  cancellation of a certificate which immediately prior to the Effective Time
  represented Parent Elected Shares under the Arrangement, together with such
  other documents and instruments as would have been required to effect the transfer
  of the Common Shares formerly represented by such certificate under the CBCA
  and the by-laws of the Company and such additional documents and instruments
  as the Company may reasonably require, the holder of such surrendered certificate
  will be entitled to receive in exchange therefor, and the Parent shall deliver
  to such holder, a certificate representing that number (rounded down to the
  nearest whole number) of Parent Common Stock which such holder has the right
  to receive (together with any dividends or distributions with respect thereto
  pursuant to Section 4.3), and the certificate so surrendered will forthwith
  be cancelled. In the event of a transfer of ownership of Common Shares which
  is not registered in the transfer records of the Company, a certificate representing
  the proper number of Parent Common Stock may be issued to the transferee if
  the certificate representing such Common Shares is presented to the Company,
  accompanied by all documents required to evidence and effect such transfer under
  the CBCA and the by-laws of the Company and such additional documents and instruments
  as the Company may reasonably require. Until surrendered as contemplated by
  this Section 4.2, each certificate which immediately prior to the Effective
  Time represented Common Shares that were or are deemed to be Parent Elected
  Shares will be deemed at all times after the Effective Time to represent only
  the right to receive upon such surrender (i) the certificate representing Parent
  Common Stock as contemplated by this Section 4.2, and (ii) any dividends or
  distributions with a record date after the Effective Time theretofore paid or
  payable with respect to the Common Shares or Parent Common Stock as contemplated
  by Section 4.3. 

	4.3 	Distributions with Respect to Unsurrendered
      Certificates 

     No dividends or other distributions
  declared or made after the Effective Time with respect to Exchangeable Shares
  or Parent Common Stock with a record date after the Effective Time will be paid
  to the holder of any unsurrendered certificate which immediately prior to the
  Effective Time represented outstanding Common Shares that were exchanged pursuant
  to Section 2.2, unless and until the holder of record of such certificate shall
  surrender such certificate in accordance with Section 4.1 or 4.2. Subject to
  applicable law, at the time of such surrender of any such certificate, there
  will be paid to the record holder of the certificates representing whole Common
  Shares, without interest, (i) the amount of dividends or other distributions
  with a record date after the Effective Time theretofore paid with respect to
  such whole Exchangeable Shares or Parent Common Stock, as the case may be, that
  the holder is entitled to receive and (iii) on the appropriate payment date,
  the amount of dividends or other distributions with a record date after the
  Effective Time but prior to surrender and a payment date 

- 9 - 

subsequent to surrender payable with respect to such whole Exchangeable
  Share or Parent Common Stock, as the case may be, that the holder is entitled
  to receive. 

	4.4 	No Fractional Shares 

     No certificates or scrip representing
  any remaining fractional Exchangeable Shares or fractional Parent Common Stock
  to which a holder may be entitled (after aggregating all such fractions to which
  such holder may be entitled) will be issued upon the surrender for exchange
  of certificates pursuant to Section 4.1 or 4.2 and no dividend, stock split
  or other change in the capital structure of ExchangeCo or Parent, as the case
  may be, will have any effect on any such fractional share and such fractional
  interests will not entitle the owner thereof to exercise any rights as a security
  holder of ExchangeCo or Parent. In lieu of any such fractional shares each Person
  otherwise entitled to a fractional share in an Exchangeable Share after aggregating
  all such fractional shares will receive that number of Exchangeable Shares or
  Parent Common Stock rounded down to the nearest whole share. 

	4.5 	Lost Certificates 

     In the event any certificate which
  immediately prior to the Effective Time represented one or more outstanding
  Common Shares that were exchanged pursuant to Section 2.2 shall have been lost,
  stolen or destroyed, upon the making of an affidavit of that fact by the Person
  claiming such certificate to be lost, stolen or destroyed, the Company will
  issue in exchange for such lost, stolen or destroyed certificate, one or more
  certificates representing one or more Exchangeable Shares or Parent Common Stock
  (and a cheque for any dividends or distributions with respect thereto pursuant
  to Section 4.3) deliverable in accordance with such holder’s Letter of
  Transmittal and Election Form. When authorizing such issuance and payment in
  exchange for any lost, stolen or destroyed certificate, the Person to whom certificates
  representing Exchangeable Shares or Parent Common Stock are to be issued shall,
  as a condition precedent to the issuance thereof, give a bond satisfactory to
  ExchangeCo, Parent and their respective transfer agents (including the Company)
  in such sum as Parent may direct or, if Parent permits indemnification in lieu
  of a bond, otherwise indemnify ExchangeCo, Parent and their respective transfer
  agents (including the Company) in a manner satisfactory to Parent against any
  claim that may be made against ExchangeCo, Parent and their respective transfer
  agents (including the Company) with respect to the certificate alleged to have
  been lost, stolen or destroyed. 

	4.6 	Extinction of Rights 

     Any certificate which immediately
  prior to the Effective Time represented outstanding Common Shares that were
  exchanged pursuant to Section 2.2 and not deposited with the Company in accordance
  with Sections 4.1 or 4.2, together with all other instruments required by Sections
  4.1 or 4.2, on or prior to the third anniversary of the Effective Date shall
  cease to represent a claim or interest of any kind or nature as a shareholder
  of the Company, Parent or ExchangeCo. On such date, the Exchangeable Shares
  or Parent Common Stock to which the former registered holder of the certificate
  referred to in the preceding sentence was ultimately entitled shall be deemed
  to have been surrendered to ExchangeCo or Parent, as the case may be, together
  with all entitlements to dividends, distributions and interest thereon held
  for such former registered holder in accordance with Section 4.3. 

	4.7 	Withholding Rights 

     ExchangeCo, Parent and the Company
  will be entitled to deduct and withhold from any dividend or consideration otherwise
  payable to any holder of Common Shares, Parent Common Stock or Exchangeable
  Shares, such amounts as ExchangeCo, Parent or the Company is required or permitted
  to deduct and withhold with respect to such payment under the ITA, the United
  States Internal Revenue 

- 10 - 

Code of 1986 or any provision of provincial, state, local or
  foreign tax law, in each case, as amended. To the extent that amounts are so
  withheld, such withheld amounts will be treated for all purposes hereof as having
  been paid to the holder of the shares in respect of which such deduction and
  withholding was made, provided that such withheld amounts are actually remitted
  to the appropriate taxing authority. To the extent that the amount so required
  or permitted to be deducted or withheld from any payment to a holder exceeds
  the cash portion of the consideration otherwise payable to the holder, ExchangeCo,
  Parent and the Company are hereby authorized to sell or otherwise dispose of
  such portion of the consideration as is necessary to provide sufficient funds
  to ExchangeCo, Parent or the Company, as the case may be, to enable it to comply
  with such deduction or withholding requirement and ExchangeCo, Parent or the
  Company will notify the holder thereof and remit to the holder any unapplied
  balance of the net proceeds of such sale. 

ARTICLE 5 

  CERTAIN RIGHTS OF PARENT TO ACQUIRE EXCHANGEABLE SHARES 

	5.1 	 Parent Liquidation Call Right

	 	 	 
		(a) 	 Parent will have the overriding right (the “Liquidation
        Call Right”), in the event of and notwithstanding the proposed
        liquidation, dissolution or winding-up of ExchangeCo pursuant to Article
        5 of the Exchangeable Share Provisions, to purchase from all but not less
        than all of the holders of Exchangeable Shares (other than any holder
        of Exchangeable Shares which is Parent or an Affiliate of Parent) on the
        Liquidation Date all but not less than all of the Exchangeable Shares
        held by each such holder on payment by Parent of an amount per share (the
        “Liquidation Call Purchase Price”) equal to the Current
        Market Price of a Parent Common Stock on the last Business Day prior to
        the Liquidation Date, which will be satisfied in full by Parent causing
        to be delivered to such holder one share of Parent Common Stock for each
        such Exchangeable Share, plus, to the extent not paid by ExchangeCo, an
        additional amount equivalent to the full amount of all declared and unpaid
        dividends on each such Exchangeable Share held by such holder on any dividend
        record date which occurred prior to the date of purchase by Parent (the
        “Dividend Amount”). In the event of the exercise of the
        Liquidation Call Right by Parent, each holder (other than Parent or Affiliates
        of Parent) shall be obligated to sell all but not less than all of the
        Exchangeable Shares held by such holder to Parent on the Liquidation Date
        on payment by Parent to the holder of the Liquidation Call Purchase Price
        for each such share, and ExchangeCo shall have no obligation to pay the
        Liquidation Amount of such shares so purchased by Parent.

	 	 	 
		(b) 	 To exercise the Liquidation Call Right, Parent must
        notify ExchangeCo of Parent’s intention to exercise such right at
        least 20 days before the Liquidation Date in the case of a voluntary liquidation,
        dissolution or winding-up of ExchangeCo and at least five Business Days
        before the Liquidation Date in the case of an involuntary liquidation,
        dissolution or winding-up of ExchangeCo. ExchangeCo will notify the holders
        of Exchangeable Shares as to whether or not Parent has exercised the Liquidation
        Call Right forthwith after the expiry of the period during which the same
        may be exercised by Parent. If Parent exercises the Liquidation Call Right,
        then on the Liquidation Date Parent will purchase and the holders (other
        than Parent or Affiliates of Parent) will sell all but not less than all
        of the Exchangeable Shares held by such holders for a price per share
        equal to the Liquidation Call Purchase Price.

	 	 	 
		(c) 	 For the purposes of completing the purchase of the Exchangeable
        Shares pursuant to the Liquidation Call Right, Parent will deposit with
        ExchangeCo, on or before the

- 11 - 

			 Liquidation Date, certificates representing the aggregate
        number of shares of Parent Common Stock deliverable by Parent and a cheque
        or cheques of Parent payable at par at any branch of the bankers of Parent
        representing the aggregate Dividend Amount in payment of the total Liquidation
        Call Purchase Price, less any amounts withheld pursuant to Section 4.7
        hereof. Provided that Parent has complied with the immediately preceding
        sentence, on and after the Liquidation Date, the rights of each holder
        of Exchangeable Shares will be limited to receiving such holder’s
        proportionate part of the total Liquidation Call Purchase Price payable
        by Parent upon presentation and surrender by the holder of certificates
        representing the Exchangeable Shares held by such holder and the holder
        will on and after the Liquidation Date be considered and deemed for all
        purposes to be the holder of the Parent Common Stock to which it is entitled.
        Upon surrender to ExchangeCo of a certificate or certificates representing
        Exchangeable Shares, together with such other documents and instruments
        as may be required to effect a transfer of Exchangeable Shares under the
        CBCA and the by-laws of ExchangeCo and such additional documents and instruments
        as ExchangeCo may reasonably require, the holder of such surrendered certificate
        or certificates will be entitled to receive in exchange therefore, and
        ExchangeCo on behalf of Parent will deliver to such holder, certificates
        representing the Parent Common Stock to which the holder is entitled and
        a cheque or cheques of Parent payable at par at any branch of the bankers
        of Parent in payment of the Dividend Amount, less any amounts withheld
        pursuant to Section 4.7 hereof. If Parent does not exercise the Liquidation
        Call Right in the manner described above, on the Liquidation Date the
        holders of the Exchangeable Shares will be entitled to receive in exchange
        therefor the Liquidation Amount of such shares pursuant to Article 5 of
        the Exchangeable Share Provisions.

	 	 	 
	5.2 	 Parent Redemption Call Right

	 	 	 
		(a) 	 Parent will have the overriding right (the “Redemption
        Call Right”), notwithstanding the proposed redemption of the
        Exchangeable Shares by ExchangeCo pursuant to Article 7 of the Exchangeable
        Share Provisions, to purchase from all but not less than all of the holders
        of Exchangeable Shares (other than any holder of Exchangeable Shares which
        is Parent or an Affiliate of Parent) on the Redemption Date all but not
        less than all of the Exchangeable Shares held by each such holder on payment
        by Parent to each holder of an amount per Exchangeable Share (the “Redemption
        Call Purchase Price”) equal to the Current Market Price of a
        Parent Common Stock on the last Business Day prior to the Redemption Date,
        which will be satisfied in full by Parent causing to be delivered to such
        holder one share of Parent Common Stock, plus the Dividend Amount, for
        each Exchangeable Share redeemed. In the event of the exercise of the
        Redemption Call Right by Parent, each holder (other than Parent or Affiliates
        of Parent) will be obligated to sell all but not less than all the Exchangeable
        Shares held by such holder to Parent on the Redemption Date on payment
        by Parent to the holder of the Redemption Call Purchase Price for each
        such share, and ExchangeCo will have no obligation to redeem such shares
        so purchased by Parent.

	 	 	 
		(b) 	 To exercise the Redemption Call Right, Parent must notify
        ExchangeCo of Parent’s intention to exercise such right at least
        60 days before the Redemption Date, except in the case of a redemption
        occurring as a result of a Parent Control Transaction, an Exchangeable
        Share Voting Event or an Exempt Exchangeable Share Voting Event, in which
        case Parent will so notify ExchangeCo on or as soon as practicable before
        the Redemption Date. ExchangeCo will notify the holders of the Exchangeable
        Shares as to whether or not Parent has exercised the Redemption Call Right
        forthwith after the expiry

- 12 - 

	 		 of the period during which the same may be exercised
        by Parent. If Parent exercises the Redemption Call Right, on the Redemption
        Date, Parent will purchase and the holders (other than Parent or Affiliates
        of Parent) will sell all but not less than all of the Exchangeable Shares
        held by such holders for a price per share equal to the Redemption Call
        Purchase Price.

	 	 	 
	 	(c) 	 For the purposes of completing the purchase of the Exchangeable
        Shares pursuant to the Redemption Call Right, Parent will deposit with
        ExchangeCo, on or before the Redemption Date, certificates representing
        the aggregate number of shares of Parent Common Stock deliverable by Parent
        and a cheque or cheques of Parent payable at par at any branch of the
        bankers of Parent representing the aggregate Dividend Amount in payment
        of the total Redemption Call Purchase Price, less any amounts withheld
        pursuant to Section 4.7 hereof. Provided that Parent has complied with
        the immediately preceding sentence, on and after the Redemption Date the
        rights of each holder of Exchangeable Shares (other than Parent or Affiliates
        of Parent) will be limited to receiving such holder’s proportionate
        part of the total Redemption Call Purchase Price payable by Parent upon
        presentation and surrender by the holder of certificates representing
        the Exchangeable Shares held by such holder and the holder will on and
        after the Redemption Date be considered and deemed for all purposes to
        be the holder of the Parent Common Stock to which it is entitled. Upon
        surrender to ExchangeCo of a certificate or certificates representing
        Exchangeable Shares, together with such other documents and instruments
        as may be required to effect a transfer of Exchangeable Shares under the
        CBCA and the by-laws of ExchangeCo and such additional documents and instruments
        as ExchangeCo and the Parent may reasonably require, the holder of such
        surrendered certificate or certificates will be entitled to receive in
        exchange therefor, and ExchangeCo on behalf of Parent will deliver to
        such holder, certificates representing the Parent Common Stock to which
        the holder is entitled and a cheque or cheques of Parent payable at par
        at any branch of the bankers of Parent in payment of the Dividend Amount,
        less any amounts withheld pursuant to Section 4.7 hereof. If Parent does
        not exercise the Redemption Call Right in the manner described above,
        on the Redemption Date the holders of the Exchangeable Shares will be
        entitled to receive in exchange therefor the Redemption Price of such
        shares pursuant to Article 7 of the Exchangeable Share Provisions.

ARTICLE 6 

  AMENDMENTS 

	6.1 	Amendments to Plan of Arrangement 

     The Company shall not amend, modify
  and/or supplement this Plan of Arrangement prior to the Effective Date unless
  each such amendment, modification and/or supplement is (i) set out in writing,
  (ii) approved by Parent, (iii) filed with the Court and, if made following the
  Company Securityholders’ Meeting, approved by the Court, and (iv) communicated
  to Company Securityholders if and as required by the Court. 

     Any amendment, modification or
  supplement to this Plan of Arrangement may be proposed by the Company at any
  time prior to the Company Securityholders’ Meeting (provided that Parent
  shall have consented thereto) with or without any other prior notice or communication,
  and if so proposed and accepted by the Persons voting at the Company Securityholders’
  Meeting (subject to the requirements set forth in the Interim Order), will become
  part of this Plan of Arrangement for all purposes. 

- 13 - 

     Any amendment, modification or
  supplement to this Plan of Arrangement that is approved or directed by the Court
  following the Company Securityholders’ Meeting will be effective only if
  (i) it is consented to by each of the Company and Parent, and (ii) if required
  by the Court, it is consented to by the Company Securityholders voting in the
  manner directed by the Court. 

- 14 - 

APPENDIX 1 

PROVISIONS ATTACHING TO THE 

  EXCHANGEABLE SHARES OF 

  6789722 CANADA INC. 

     The Exchangeable Shares of 6789722
  Canada Inc. (the “Corporation”) shall have the following rights,
  privileges, restrictions and conditions: 

ARTICLE 1 

  INTERPRETATION 

	1.1 	For the purposes of these share provisions: 

     “Affiliate” of
  any Person means any other Person directly or indirectly controlling, controlled
  by, or under common control with, that Person. For the purposes of this definition,
  “control” (including, with correlative meanings, the terms “controlled
  by” and “under common control with”), as applied to any Person,
  means the possession by another Person, directly or indirectly, of the power
  to direct or cause the direction of the management and policies of that first
  mentioned Person, whether through the ownership of voting securities, by contract
  or otherwise. 

     “Board of Directors”
  means the board of directors of the Corporation. 

     “Business Day”
  means any day on which commercial banks are generally open for business in Vancouver,
  British Columbia, other than a Saturday, a Sunday or a day observed as a holiday
  in Vancouver, British Columbia under the laws of the Province of British
  Columbia or the federal laws of Canada. 

     “Canadian Dollar Equivalent”
  means, in respect of an amount expressed in a currency other than Canadian dollars
  (the “Foreign Currency Amount”) at any date, the product obtained
  by multiplying: (a) the Foreign Currency Amount, by (b) the noon spot exchange
  rate on such date for such foreign currency expressed in Canadian dollars as
  reported by the Bank of Canada or, in the event such spot exchange rate is not
  available, such spot exchange rate on such date for such foreign currency expressed
  in Canadian dollars as may be deemed by the Board of Directors to be appropriate
  for such purpose. 

     “Common Share”
  means a share in the class of common shares in the capital of the Corporation.

     “Corporation”
  means 6789722 Canada Inc., a corporation governed by the Canada Business
  Corporations Act and being a wholly-owned subsidiary of Parent. 

     “Current Market Price”
  means, in respect of a Parent Common Stock on any date, the Canadian Dollar
  Equivalent of the average of the closing prices of Parent Common Stock during
  a period of 20 consecutive trading days ending not more than three trading days
  before such date on OTC, or, if the Parent Common Stock are not then quoted
  on OTC, on such other stock exchange or automated quotation system on which
  the Parent Common Stock are listed or quoted, as the case may be, as may be
  selected by the Board of Directors for such purpose; provided, however, that
  if in the opinion of the Board of Directors the public distribution or trading
  activity of Parent Common Stock during such period does not create a market
  which reflects the fair market value of a Parent Common Stock, then the Current

- 15 - 

Market Price of a Parent Common Stock shall be determined by
  the Board of Directors, in good faith and in its sole discretion, and provided
  further that any such selection, opinion or determination by the Board of Directors
  shall be conclusive and binding. 

     “Dividend Amount”
  has the meaning ascribed to that term in Section 6.3 of these share provisions.

     “Entity” means
  any corporation (including any non-profit corporation), general partnership,
  limited partnership, limited liability partnership, joint venture, estate, trust,
  company (including any company limited by shares, limited liability company
  or joint stock company), firm, society or other enterprise, association, organization
  or entity. 

     “Exchangeable Share”
  means a share in the class of non-voting exchangeable shares in the capital
  of the Corporation having the rights, privileges, restrictions and conditions
  set forth herein. 

     “Exchangeable Share Support
  Agreement” means the Exchangeable Share Support Agreement among Parent
  and the Corporation, to be entered into in connection with the Plan of Arrangement.

     “Exchangeable Share Voting
  Event” means any matter in respect of which holders of Exchangeable
  Shares are entitled to vote as shareholders of the Corporation, other than an
  Exempt Exchangeable Share Voting Event, and, for greater certainty, excluding
  any matter in respect of which holders of Exchangeable Shares are entitled to
  vote (or instruct the Trustee to vote) in their capacity as Beneficiaries under
  (and as that term is defined in) the Voting and Exchange Trust Agreement. 

     “Exempt Exchangeable Share
  Voting Event” means any matter in respect of which holders of Exchangeable
  Shares are entitled to vote as shareholders of the Corporation in order to approve
  or disapprove, as applicable, any change to, or in the rights of the holders
  of, the Exchangeable Shares, where the approval or disapproval, as applicable,
  of such change would be required to maintain the equivalence of the Exchangeable
  Shares and the Parent Common Stock. 

     “Governmental Body”
  means any: (a) nation, state, commonwealth, province, territory, county, municipality,
  district or other jurisdiction of any nature; (b) federal, state, provincial,
  local, municipal, foreign or other government; or (c) governmental or quasi-governmental
  authority of any nature (including any governmental division, department, agency,
  commission, instrumentality, official, ministry, fund, foundation, centre, organization,
  unit, body or Entity and any court or other tribunal). 

     “Liquidation Amount”
  has the meaning ascribed to that term in Section 5.1 of these share provisions.

     “Liquidation Call Right”
  has the meaning ascribed to that term in the Plan of Arrangement.

     “Liquidation Date”
  has the meaning ascribed to that term in Section 5.1 of these share provisions.

     “Parent” means
  CounterPath Solutions, Inc., a corporation existing under the laws of the State
  of Nevada, and includes any successor thereto. 

     “Parent Call Notice”
  has the meaning ascribed to that term in Section 6.3 of these share provisions.

- 16 - 

     “Parent Common Stock”
  means a share of common stock, par value U.S. $0.001 per share, in the capital
  of Parent, and any other security into which such share may be changed. 

     “Parent Control Transaction”
  means (i) any merger, amalgamation, reorganization or other similar event involving
  Parent, (ii) any tender offer for Parent, (iii) any material sale of assets
  or shares or rights or interests therein or thereto by Parent, or (iv) any similar
  transactions involving Parent, or (v) any proposal to do any of the foregoing.

     “Parent Dividend Declaration
  Date” means the date on which the board of directors of Parent declares
  any dividend on the Parent Common Stock. 

     “Person” means any
  individual, Entity or Governmental Body. 

     “Plan of Arrangement”
  means the plan of arrangement relating to the arrangement involving Parent,
  the Corporation and NewHeights Software Corporation under Section 192 of the
  Canada Business Corporations Act, as amended, modified or supplemented
  from time to time in accordance with the plan and any order of the Supreme Court
  of British Columbia, to which plan these share provisions are attached as Appendix
  1 and which plan (other than Appendix 1 thereto) is attached to these share
  provisions as Exhibit A. 

     “Purchase Price”
  has the meaning ascribed to that term in Section 6.3 of these share provisions.

     “Redemption Call Purchase
  Price” has the meaning ascribed to that term in the Plan of Arrangement.

     “Redemption Call Right”
  has the meaning ascribed to that term in the Plan of Arrangement. 

     “Redemption Date”
  means the date, if any, established by the Board of Directors for the redemption
  by the Corporation of all but not less than all of the outstanding Exchangeable
  Shares pursuant to Article 7 of these share provisions, which date shall be
  no earlier than July 31, 2012 unless: 

	 	(a) 	 there are fewer than 10% of the Exchangeable Shares
        originally issued outstanding (other than Exchangeable Shares held by
        Parent and its Affiliates, and as such number of shares may be adjusted
        as deemed appropriate by the Board of Directors to give effect to any
        subdivision or consolidation of or stock dividend on the Exchangeable
        Shares, any issue or distribution of rights to acquire Exchangeable Shares
        or securities exercisable or exchangeable for or convertible into Exchangeable
        Shares, any issue or distribution of other securities or rights or evidences
        of indebtedness or assets, or any other capital reorganization or other
        transaction affecting the Exchangeable Shares), in which case the Board
        of Directors may accelerate such redemption date to such date prior to
        July 31, 2012 as they may determine, upon at least 60 days’ prior
        written notice to the registered holders of the Exchangeable Shares;

	 	 	 
	 	(b) 	 a Parent Control Transaction occurs, in which case,
        provided that the Board of Directors determines, in good faith and in
        its sole discretion, that it is not reasonably practicable to substantially
        replicate or modify the terms and conditions of the Exchangeable Shares
        in connection with such Parent Control Transaction or that the redemption
        of all but not less than all of the outstanding Exchangeable Shares is
        necessary to enable the completion of such Parent Control Transaction
        in accordance with its terms, the Board of Directors may

- 17 - 

	 		 accelerate such redemption date to such date prior to
        July 31, 2012 as it may determine, upon such number of days’ prior
        written notice to the registered holders of the Exchangeable Shares and
        to Parent as the Board of Directors may determine to be reasonably practicable
        in such circumstances;

	 	 	 
	 	(c) 	 an Exchangeable Share Voting Event is proposed, in which
        case, provided that the Board of Directors has determined, in good faith
        and in its sole discretion, that it is not reasonably practicable to accomplish
        the business purpose intended by the Exchangeable Share Voting Event,
        which business purpose must be bona fide and not for the primary purpose
        of causing the occurrence of a Redemption Date, in any other commercially
        reasonable manner that does not result in an Exchangeable Share Voting
        Event, the Redemption Date shall be the Business Day prior to the record
        date for any meeting or vote of the holders of the Exchangeable Shares
        to consider the Exchangeable Share Voting Event and the Board of Directors
        shall give such number of days’ prior written notice of such redemption
        to the registered holders of the Exchangeable Shares as the Board of Directors
        may determine to be reasonably practicable in such circumstances; or

	 	 	 
	 	(d) 	 an Exempt Exchangeable Share Voting Event is proposed
        and the holders of the Exchangeable Shares fail to take the necessary
        action at a meeting or other vote of holders of Exchangeable Shares, to
        approve or disapprove, as applicable, the Exempt Exchangeable Share Voting
        Event, in which case the Redemption Date shall be the Business Day following
        the day on which the holders of the Exchangeable Shares failed to take
        such action and the Board of Directors shall give such number of days’
        prior written notice of such redemption to the registered holders of the
        Exchangeable Shares as the Board of Directors may determine to be reasonably
        practicable in such circumstances,

provided, however, that the accidental failure or omission to
  give any notice of redemption under clauses (a), (b), (c) or (d) above to less
  than 10% of such holders of Exchangeable Shares shall not affect the validity
  of any such redemption. 

     “Redemption Price”
  has the meaning ascribed to that term in Section 7.1 of these share provisions.

     “Retracted Shares”
  has the meaning ascribed to that term in Section 6.1(a) of these share provisions.

     “Retraction Call Right”
  has the meaning ascribed to that term in Section 6.1(c) of these share provisions.

     “Retraction Date”
  has the meaning ascribed to that term in Section 6.1(b) of these share provisions.

     “Retraction Price”
  has the meaning ascribed to that term in Section 6.1 of these share provisions.

     “Retraction Request”
  has the meaning ascribed to that term in Section 6.1 of these share provisions.

     “Trustee” means
  Valiant Trust Company or such other trust company or other Entity chosen as
  trustee under the Voting and Exchange Trust Agreement, and any successor trustee
  appointed under the Voting and Exchange Trust Agreement. 

- 18 - 

     “Voting and Exchange Trust
  Agreement” means the Voting and Exchange Trust Agreement among Parent,
  the Corporation and the Trustee, to be entered into in connection with the Plan
  of Arrangement. 

ARTICLE 2

  RANKING OF EXCHANGEABLE SHARES 

2.1 Subject to Section 4.1 hereof, the Exchangeable Shares shall
  be entitled to a preference over the Common Shares and any other shares ranking
  junior to the Exchangeable Shares with respect to the payment of dividends and
  the distribution of assets in the event of the liquidation, dissolution or winding-up
  of the Corporation, whether voluntary or involuntary, or any other distribution
  of the assets of the Corporation, among its shareholders for the purpose of
  winding up its affairs. 

ARTICLE 3 

  DIVIDENDS 

3.1 Subject to Section 3.2 hereof, a holder of an Exchangeable
  Share shall be entitled to receive and the Board of Directors shall, subject
  to applicable law, on each Parent Dividend Declaration Date, declare a dividend
  on each Exchangeable Share: 

	 	(a) 	 in the case of a cash dividend declared on the Parent
        Common Stock, in an amount in cash for each Exchangeable Share in U.S.
        dollars, or the Canadian Dollar Equivalent thereof on the Parent Dividend
        Declaration Date, in each case, equal to the cash dividend declared on
        each Parent Common Stock;

	 	 	 
	 	(b) 	 in the case of a stock dividend declared on the Parent
        Common Stock to be paid in Parent Common Stock, in such number of Exchangeable
        Shares for each Exchangeable Share as is equal to the number of Parent
        Common Stock to be paid on each Parent Common Stock; or

	 	 	 
	 	(c) 	 in the case of a dividend declared on the Parent Common
        Stock in property other than cash or Parent Common Stock, in such type
        and amount of property for each Exchangeable Share as is the same as or
        economically equivalent to (to be determined by the Board of Directors
        as contemplated by Section 3.6 hereof) the type and amount of property
        declared as a dividend on each Parent Common Stock.

     Such dividends shall be paid out
  of money, assets or property of the Corporation properly applicable to the payment
  of dividends, or out of authorized but unissued shares of the Corporation, as
  applicable. 

3.2 In the case of a stock dividend declared on the Parent Common
  Stock to be paid in Parent Common Stock, in lieu of declaring the stock dividend
  contemplated by Section 3.1(b) on the Exchangeable Shares, the Board of Directors
  may, in its discretion and subject to applicable law, subdivide, redivide or
  change (the “subdivision”) each issued and unissued Exchangeable Share
  on the basis that each Exchangeable Share before the subdivision becomes a number
  of Exchangeable Shares as is equal to the sum of (i) a Parent Common Stock and
  (ii) the number of Parent Common Stock to be paid as a stock dividend on each
  Parent Common Stock. In such instance, and notwithstanding any other provision
  hereof, such subdivision shall become effective on the effective date specified
  in Section 3.4 hereof without any further act or formality on the part of the
  Board of Directors or of the holders of Exchangeable Shares. For greater certainty,
  no approval of the holders of Exchangeable Shares to an amendment to the articles
  of the Corporation shall be required to give effect to such subdivision. 

- 19 - 

3.3 Cheques of the Corporation payable at par at any branch of
  the bankers of the Corporation shall be issued in respect of any cash dividends
  contemplated by Section 3.1(a) hereof and the sending of such a cheque to each
  holder of an Exchangeable Share shall satisfy the cash dividend represented
  thereby unless the cheque is not paid on presentation. Subject to applicable
  law, certificates registered in the name of the registered holder of Exchangeable
  Shares shall be issued or transferred in respect of any stock dividends contemplated
  by Section 3.1(b) hereof or the subdivision of Exchangeable Shares contemplated
  by Section 3.2 hereof and the sending of such a certificate to each holder of
  an Exchangeable Share shall satisfy the stock dividend represented thereby.
  Such other type and amount of property in respect of any dividends contemplated
  by Section 3.1(c) hereof shall be issued, distributed or transferred by the
  Corporation in such manner as it shall determine and the issuance, distribution
  or transfer thereof by the Corporation to each holder of an Exchangeable Share
  shall satisfy the dividend represented thereby. No holder of an Exchangeable
  Share shall be entitled to recover by action or other legal process against
  the Corporation any dividend that is represented by a cheque that has not been
  duly presented to the Corporation’s bankers for payment or that otherwise
  remains unclaimed for a period of six years from the date on which such dividend
  was payable. 

3.4 The record date for the determination of the holders of Exchangeable
  Shares entitled to receive payment of, and the payment date for, any dividend
  declared on the Exchangeable Shares under Section 3.1 hereof shall be the same
  dates as the record date and payment date, respectively, for the corresponding
  dividend declared on the Parent Common Stock. The record date for the determination
  of the holder of Exchangeable Shares entitled to receive Exchangeable Shares
  in connection with any subdivision of Exchangeable Shares under Section 3.2
  hereof and the effective date of such subdivision shall be the same dates as
  the record date and payment date, respectively, for the corresponding stock
  dividend declared on Parent Common Stock. 

3.5 If on any payment date for any dividends declared on the
  Exchangeable Shares under Section 3.1 hereof the dividends are not paid in full
  on all of the Exchangeable Shares then outstanding, any such dividends that
  remain unpaid shall be paid on a subsequent date or dates determined by the
  Board of Directors on which the Corporation shall have sufficient moneys, assets
  or property properly applicable to the payment of such dividends. 

3.6 The Board of Directors shall determine, in good faith and
  in its sole discretion, economic equivalence for the purposes of Sections 3.1
  and 3.2 hereof, and each such determination shall be conclusive and binding
  on the Corporation and its shareholders. In making each such determination,
  the following factors shall, without excluding other factors determined by the
  Board of Directors to be relevant, be considered by the Board of Directors:

	 	(a) 	 in the case of any stock dividend or other distribution
        payable in Parent Common Stock, the number of such shares issued in proportion
        to the number of Parent Common Stock previously outstanding;

	 	 	 
	 	(b) 	 in the case of the issuance or distribution of any rights,
        options or warrants to subscribe for or purchase Parent Common Stock (or
        securities exercisable or exchangeable for or convertible into or carrying
        rights to acquire Parent Common Stock), the relationship between the exercise
        price of each such right, option or warrant and the current market value
        (as determined by the Board of Directors in the manner above contemplated)
        of a Parent Common Stock;

	 	 	 
	 	(c) 	 in the case of the issuance or distribution of any other
        form of property (including without limitation any shares or securities
        of Parent of any class other than Parent Common Stock, any rights, options
        or warrants other than those referred to in Section

- 20 - 

	 		 3.6(b) above, any evidences of indebtedness of Parent
        or any assets of Parent), the relationship between the fair market value
        (as determined by the Board of Directors in the manner above contemplated)
        of such property to be issued or distributed with respect to each outstanding
        Parent Common Stock and the current market value (as determined by the
        Board of Directors in the manner above contemplated) of a Parent Common
        Stock; and

	 	 	 
	 	(d) 	 in all such cases, the general taxation consequences
        of the relevant event to holders of Exchangeable Shares to the extent
        that such consequences may differ from the taxation consequences to holders
        of Parent Common Stock as a result of differences between taxation laws
        of Canada and the United States (except for any differing consequences
        arising as a result of differing marginal taxation rates and without regard
        to the individual circumstances of holders of Exchangeable Shares).

     For purposes of the foregoing determinations,
  the current market value of any security listed and traded or quoted on a securities
  exchange shall be the weighted average of the daily trading prices of such security
  during a period of not less than 20 consecutive trading days ending not more
  than three trading days before the date of determination on the principal securities
  exchange on which such securities are listed and traded or quoted; provided,
  however, that if in the opinion of the Board of Directors the public distribution
  or trading activity of such securities during such period does not create a
  market which reflects the fair market value of such securities, then the current
  market value thereof shall be determined by the Board of Directors, in good
  faith and in its sole discretion, and provided further that any such determination
  by the Board of Directors shall be conclusive and binding on the Corporation
  and its shareholders. 

ARTICLE 4 

  CERTAIN RESTRICTIONS 

4.1 So long as any of the Exchangeable Shares are outstanding,
  the Corporation shall not at any time without, but may at any time with, the
  approval of the holders of the Exchangeable Shares given as specified in Section
  9.2 of these share provisions: 

	 	(a) 	 pay any dividends on the Common Shares or any other
        shares ranking junior to the Exchangeable Shares, other than stock dividends
        payable in Common Shares or any such other shares ranking junior to the
        Exchangeable Shares, as the case may be;

	 	 	 
	 	(b) 	 redeem or purchase or make any capital distribution
        in respect of Common Shares or any other shares ranking junior to the
        Exchangeable Shares;

	 	 	 
	 	(c) 	 redeem or purchase any other shares of the Corporation
        ranking equally with the Exchangeable Shares with respect to the payment
        of dividends or on any liquidation distribution; or

	 	 	 
	 	(d) 	 issue any Exchangeable Shares or any other shares of
        the Corporation ranking equally with, or superior to, the Exchangeable
        Shares other than by way of stock dividends to the holders of such Exchangeable
        Shares.

     The restrictions in Sections 4.1(a),
  4.1(b), 4.1(c) and 4.1(d) above shall not apply if all dividends on the outstanding
  Exchangeable Shares corresponding to dividends declared and paid to date on
  the Parent Common Stock shall have been declared and paid on the Exchangeable
  Shares. 

- 21 - 

ARTICLE 5 

  DISTRIBUTION ON LIQUIDATION 

5.1 In the event of the liquidation, dissolution or winding-up
  of the Corporation or any other distribution of the assets of the Corporation
  among its shareholders for the purpose of winding up its affairs, subject to
  the exercise by Parent of the Liquidation Call Right, a holder of Exchangeable
  Shares shall be entitled, subject to applicable law, to receive from the assets
  of the Corporation in respect of each Exchangeable Share held by such holder
  on the effective date (the “Liquidation Date”) of such liquidation,
  dissolution or winding-up, before any distribution of any part of the assets
  of the Corporation among the holders of the Common Shares or any other shares
  ranking junior to the Exchangeable Shares, an amount per share equal to the
  Current Market Price of a Parent Common Stock on the last Business Day prior
  to the Liquidation Date (the “Liquidation Amount”), which shall
  be satisfied in full by the Corporation causing to be delivered to such holder
  one share of Parent Common Stock, together with all declared and unpaid dividends
  on each such Exchangeable Share held by such holder on any dividend record date
  which occurred prior to the Liquidation Date. 

5.2 On or promptly after the Liquidation Date, and subject to
  the exercise by Parent of the Liquidation Call Right, the Corporation shall
  cause to be delivered to the holders of the Exchangeable Shares the Liquidation
  Amount for each such Exchangeable Share upon presentation and surrender of the
  certificates representing such Exchangeable Shares, together with such other
  documents and instruments as are required to effect a transfer of Exchangeable
  Shares under the Canada Business Corporations Act and the by-laws of
  the Corporation and such additional documents and instruments as the Parent
  or the Corporation may reasonably require, at the registered office of the Corporation
  by notice to the holders of the Exchangeable Shares. Payment of the total Liquidation
  Amount for such Exchangeable Shares shall be made by delivery to each holder,
  at the address of the holder recorded in the securities register of the Corporation
  for the Exchangeable Shares or by holding for pick-up by the holder at the registered
  office of the Corporation by notice to the holders of Exchangeable Shares, on
  behalf of the Corporation of certificates representing Parent Common Stock (which
  shares shall be duly issued as fully paid and non-assessable and shall be free
  and clear of any lien, claim or encumbrance) and a cheque of the Corporation
  payable at par at any branch of the bankers of the Corporation in respect of
  the remaining portion, if any, of the total Liquidation Amount (in each case
  less any amounts withheld on account of tax required to be deducted and withheld
  therefrom). On and after the Liquidation Date, the holders of the Exchangeable
  Shares shall cease to be holders of such Exchangeable Shares and shall not be
  entitled to exercise any of the rights of holders in respect thereof, other
  than the right to receive their proportionate part of the total Liquidation
  Amount, unless payment of the total Liquidation Amount for such Exchangeable
  Shares shall not be made upon presentation and surrender of share certificates
  in accordance with the foregoing provisions, in which case the rights of the
  holders shall remain unaffected until the total Liquidation Amount has been
  paid in the manner hereinbefore provided. The Corporation shall have the right
  at any time after the Liquidation Date to deposit or cause to be deposited the
  total Liquidation Amount in respect of the Exchangeable Shares represented by
  certificates that have not at the Liquidation Date been surrendered by the holders
  thereof in a custodial account with any chartered bank or trust company in Canada.
  Upon such deposit being made, the rights of the holders of Exchangeable Shares
  after such deposit shall be limited to receiving their proportionate part of
  the total Liquidation Amount (in each case less any amounts withheld on account
  of tax required to be deducted and withheld therefrom) for such Exchangeable
  Shares so deposited, against presentation and surrender of the said certificates
  held by them, respectively, in accordance with the foregoing provisions. Upon
  such payment or deposit of the total Liquidation Amount, the holders of the
  Exchangeable Shares shall thereafter be considered and deemed for all purposes
  to be holders of the Parent Common Stock delivered to them or the custodian
  on their behalf. 

- 22 - 

5.3 After the Corporation has satisfied its obligations to pay
  the holders of the Exchangeable Shares the Liquidation Amount per Exchangeable
  Share pursuant to Section 5.1 of these share provisions, such holders shall
  not be entitled to share in any further distribution of the assets of the Corporation.

ARTICLE 6 

  RETRACTION OF EXCHANGEABLE SHARES BY HOLDER 

6.1 A holder of Exchangeable Shares shall be entitled at any
  time, subject to the exercise by Parent of the Retraction Call Right and otherwise
  upon compliance with the provisions of this Article 6, to require the Corporation
  to redeem any or all of the Exchangeable Shares registered in the name of such
  holder for an amount per share equal to the Current Market Price of a Parent
  Common Stock on the last Business Day prior to the Retraction Date (the “Retraction
  Price”), which shall be satisfied in full by the Corporation causing
  to be delivered to such holder one share of Parent Common Stock for each Exchangeable
  Share presented and surrendered by the holder, together with, on the payment
  date therefor, the full amount of all declared and unpaid dividends on any such
  Exchangeable Share held by such holder on any dividend record date which occurred
  prior to the Retraction Date. To effect such redemption, the holder shall present
  and surrender at the registered office of the Corporation by notice to the holders
  of Exchangeable Shares the certificate or certificates representing the Exchangeable
  Shares which the holder desires to have the Corporation redeem, together with
  such other documents and instruments as are required to effect a transfer of
  Exchangeable Shares under the Canada Business Corporations Act and the
  by-laws of the Corporation and such additional documents and instruments as
  the Parent or the Corporation may reasonably require, and together with a duly
  executed statement (the “Retraction Request”) in the form of
  Schedule A hereto or in such other form as may be acceptable to the Corporation:

	 	(a) 	 specifying that the holder desires to have all or any
        number specified therein of the Exchangeable Shares represented by such
        certificate or certificates (the “Retracted Shares”) redeemed
        by the Corporation;

	 	 	 
	 	(b) 	 stating the Business Day on which the holder desires
        to have the Corporation redeem the Retracted Shares (the “Retraction
        Date”), provided that the Retraction Date shall be not less than
        10 Business Days nor more than 15 Business Days after the date on which
        the Retraction Request is received by the Corporation and further provided
        that, in the event that no such Business Day is specified by the holder
        in the Retraction Request, the Retraction Date shall be deemed to be the
        15th Business Day after the date on which the Retraction Request is received
        by the Corporation; and

	 	 	 
	 	(c) 	 acknowledging the overriding right (the “Retraction
        Call Right”) of Parent to purchase all but not less than all
        the Retracted Shares directly from the holder and that the Retraction
        Request shall be deemed to be a revocable offer by the holder to sell
        the Retracted Shares to Parent in accordance with the Retraction Call
        Right on the terms and conditions set out in Section 6.3 below.

6.2 Subject to the exercise by Parent of the Retraction Call
  Right, upon receipt by the Corporation in the manner specified in Section 6.1
  hereof of a certificate or certificates representing the number of Exchangeable
  Shares which the holder desires to have the Corporation redeem, together with
  a Retraction Request and such other documents and instruments as are required
  to effect a transfer of Exchangeable Shares under the Canada Business Corporations
  Act and the by-laws of the Corporation and such additional documents and
  instruments as the Parent or the Corporation may reasonably require, and provided
  that the Retraction Request is not revoked by the holder in the manner specified
  in Section 6.7, the Corporation shall redeem the Retracted Shares effective
  at the close of business on the Retraction 

- 23 - 

Date and shall cause to be delivered to such holder the total
  Retraction Price with respect to such shares, provided that all declared and
  unpaid dividends for which the record date has occurred prior to the Retraction
  Date shall be paid on the payment date for such dividends. If only a part of
  the Exchangeable Shares represented by any certificate is redeemed (or purchased
  by Parent pursuant to the Retraction Call Right), a new certificate for the
  balance of such Exchangeable Shares shall be issued to the holder at the expense
  of the Corporation. 

6.3 Upon receipt by the Corporation of a Retraction Request,
  the Corporation shall immediately notify Parent thereof. In order to exercise
  the Retraction Call Right, Parent must notify the Corporation of its determination
  to do so (the “Parent Call Notice”) within five Business Days
  of notification to Parent by the Corporation of the receipt by the Corporation
  of the Retraction Request. If Parent does not so notify the Corporation within
  such five Business Day period, the Corporation will notify the holder as soon
  as possible thereafter that Parent will not exercise the Retraction Call Right.
  If Parent delivers the Parent Call Notice within such five Business Day period,
  and provided that the Retraction Request is not revoked by the holder in the
  manner specified in Section 6.7, the Retraction Request shall thereupon be considered
  only to be an offer by the holder to sell the Retracted Shares to Parent in
  accordance with the Retraction Call Right. In such event, the Corporation shall
  not redeem the Retracted Shares and Parent shall purchase from such holder and
  such holder shall sell to Parent on the Retraction Date the Retracted Shares
  for a purchase price (the “Purchase Price”) per share equal
  to the Retraction Price per share which shall be satisfied in full by Parent
  causing to be delivered to such holder one share of Parent Common Stock for
  each Exchangeable Share presented and surrendered by the holder, plus, on the
  designated payment date therefor, to the extent not paid by the Corporation
  on the designated payment date therefor, an additional amount equivalent to
  the full amount of all declared and unpaid dividends on those Retracted Shares
  held by such holder on any dividend record date which occurred prior to the
  Retraction Date (the “Dividend Amount”). For the purposes of
  completing a purchase pursuant to the Retraction Call Right, Parent shall deposit
  with the Corporation, on or before the Retraction Date, certificates representing
  shares of Parent Common Stock and a cheque or cheques of Parent payable at par
  at any branch of the bankers of Parent representing the aggregate Dividend Amount,
  less any amounts withheld on account of tax required to be deducted and withheld
  therefrom. Provided that Parent has complied with the immediately preceding
  sentence, the closing of the purchase and sale of the Retracted Shares pursuant
  to the Retraction Call Right shall be deemed to have occurred as at the close
  of business on the Retraction Date and, for greater certainty, no redemption
  by the Corporation of such Retracted Shares shall take place on the Retraction
  Date. In the event that Parent does not deliver a Parent Call Notice within
  such five Business Day period, and provided that the Retraction Request is not
  revoked by the holder in the manner specified in Section 6.7, the Corporation
  shall redeem the Retracted Shares on the Retraction Date and in the manner otherwise
  contemplated in this Article 6. 

6.4 The Corporation or Parent, as the case may be, shall deliver
  to the relevant holder, at the address of the holder recorded in the securities
  register of the Corporation for the Exchangeable Shares or at the address specified
  in the holder’s Retraction Request or by holding for pick-up by the holder
  at the registered office of the Corporation by notice to the holders of Exchangeable
  Shares, certificates representing the Parent Common Stock (which shares shall
  be duly issued as fully paid and non-assessable and shall be free and clear
  of any lien, claim or encumbrance) registered in the name of the holder or in
  such other name as the holder may request, and, if applicable and on or before
  the payment date therefor, a cheque payable at par at any branch of the bankers
  of the Corporation or Parent, as applicable, representing the aggregate Dividend
  Amount in payment of the total Retraction Price or the total Purchase Price,
  as the case may be, in each case, less any amounts withheld on account of tax
  required to be deducted and withheld therefrom, and such delivery of such certificates
  and cheques on behalf of the Corporation or by Parent, as the case may be, shall
  be deemed to be payment of and shall satisfy and discharge all liability for
  the total Retraction Price or total Purchase Price, as the case may be, 

- 24 - 

to the extent that the same is represented by such share certificates
  and cheques (plus any tax deducted and withheld therefrom and remitted to the
  proper tax authority). 

6.5 On and after the close of business on the Retraction Date,
  the holder of the Retracted Shares shall cease to be a holder of such Retracted
  Shares and shall not be entitled to exercise any of the rights of a holder in
  respect thereof, other than the right to receive his proportionate part of the
  total Retraction Price or total Purchase Price, as the case may be, unless upon
  presentation and surrender of certificates in accordance with the foregoing
  provisions, payment of the total Retraction Price or the total Purchase Price,
  as the case may be, shall not be made as provided in Section 6.4, in which case
  the rights of such holder shall remain unaffected until the total Retraction
  Price or the total Purchase Price, as the case may be, has been paid in the
  manner hereinbefore provided. On and after the close of business on the Retraction
  Date, provided that presentation and surrender of certificates and payment of
  the total Retraction Price or the total Purchase Price, as the case may be,
  has been made in accordance with the foregoing provisions, the holder of the
  Retracted Shares so redeemed by the Corporation or purchased by Parent shall
  thereafter be considered and deemed for all purposes to be a holder of the Parent
  Common Stock delivered to it. 

6.6 Notwithstanding any other provision of this Article 6, the
  Corporation shall not be obligated to redeem Retracted Shares specified by a
  holder in a Retraction Request to the extent that such redemption of Retracted
  Shares would be contrary to solvency requirements or other provisions of applicable
  law. If the Corporation believes that on any Retraction Date it would not be
  permitted by any of such provisions to redeem the Retracted Shares tendered
  for redemption on such date, and provided that Parent shall not have exercised
  the Retraction Call Right with respect to the Retracted Shares, the Corporation
  shall only be obligated to redeem Retracted Shares specified by a holder in
  a Retraction Request to the extent of the maximum number that may be so redeemed
  (rounded down to a whole number of shares) as would not be contrary to such
  provisions and shall notify the holder at least two Business Days prior to the
  Retraction Date as to the number of Retracted Shares which will not be redeemed
  by the Corporation. In any case in which the redemption by the Corporation of
  Retracted Shares would be contrary to solvency requirements or other provisions
  of applicable law, the Corporation shall redeem the maximum number of Exchangeable
  Shares which the Board of Directors determine the Corporation is, on the Retraction
  Date, permitted to redeem, which shall be selected as nearly as may be pro rata
  (disregarding fractions) in proportion to the total number of Exchangeable Shares
  tendered for retraction by each holder thereof and the Corporation shall issue
  to each holder of Retracted Shares a new certificate, at the expense of the
  Corporation, representing the Retracted Shares not redeemed by the Corporation
  pursuant to Section 6.2 hereof. Provided that the Retraction Request is not
  revoked by the holder in the manner specified in Section 6.7, the holder of
  any such Retracted Shares not redeemed by the Corporation pursuant to Section
  6.2 of these share provisions as a result of solvency requirements or other
  provisions of applicable law shall be deemed by giving the Retraction Request
  to have instructed the Trustee to require to purchase such Retracted Shares
  from such holder on the Retraction Date or as soon as practicable thereafter
  on payment by to such holder of the Purchase Price for each such Retracted Share,
  all as more specifically provided in Section 5.7 of the Voting and Exchange
  Trust Agreement. 

6.7 A holder of Retracted Shares may, by notice in writing given
  by the holder to the Corporation before the close of business on the Business
  Day immediately preceding the Retraction Date, withdraw its Retraction Request,
  in which event such Retraction Request shall be null and void and, for greater
  certainty, the revocable offer constituted by the Retraction Request to sell
  the Retracted Shares to Parent shall be deemed to have been revoked. 

- 25 - 

ARTICLE 7 

  REDEMPTION OF EXCHANGEABLE SHARES BY THE CORPORATION 

7.1 Subject to applicable law, and provided Parent has not exercised
  the Redemption Call Right, the Corporation shall on the Redemption Date redeem
  all but not less than all of the then outstanding Exchangeable Shares for an
  amount per share equal to the Current Market Price of a Common Share on the
  last Business Day prior to the Redemption Date (the “Redemption Price”),
  which shall be satisfied in full by the Corporation causing to be delivered
  to each holder of Exchangeable Shares one share of Parent Common Stock for each
  Exchangeable Share held by such holder, together with the full amount of all
  declared and unpaid dividends on each such Exchangeable Share held by such holder
  on any dividend record date which occurred prior to the Redemption Date. 

7.2 In any case of a redemption of Exchangeable Shares under
  this Article 7, the Corporation shall, at least 60 days before the Redemption
  Date (other than a Redemption Date established in connection with a Parent Control
  Transaction, an Exchangeable Share Voting Event or an Exempt Exchangeable Share
  Voting Event), send or cause to be sent to each holder of Exchangeable Shares
  a notice in writing of the redemption by the Corporation or the purchase by
  Parent under the Redemption Call Right, as the case may be, of the Exchangeable
  Shares held by such holder; provided that if the notice period of 60 days would
  expire after the date that would, but for such 60-day period, be established
  as the Redemption Date, then the Redemption Date will be deferred until the
  notice period of 60 days has passed. In the case of a Redemption Date established
  in connection with a Parent Control Transaction, an Exchangeable Share Voting
  Event and an Exempt Exchangeable Share Voting Event, the written notice of redemption
  by the Corporation or the purchase by Parent under the Redemption Call Right
  will be sent on or before the Redemption Date, on as many days prior written
  notice as may be determined by the Board of Directors of the Corporation to
  be reasonably practicable in the circumstances. In any such case, such notice
  shall set out the Redemption Price or the Redemption Call Purchase Price, as
  the case may be, the Redemption Date and, if applicable, particulars of the
  Redemption Call Right. 

7.3 On or after the Redemption Date and subject to the exercise
  by Parent of the Redemption Call Right, the Corporation shall cause to be delivered
  to the holders of the Exchangeable Shares to be redeemed the Redemption Price
  for each such Exchangeable Share, together with the full amount of all declared
  and unpaid dividends on each such Exchangeable Share held by such holder on
  any dividend record date which occurred prior to the Redemption Date, upon presentation
  and surrender at the registered office of the Corporation or Parent or the Corporation
  as may be specified by the Corporation in such notice of the certificates representing
  such Exchangeable Shares, together with such other documents and instruments
  as may be required to effect a transfer of Exchangeable Shares under the Canada
  Business Corporations Act and the by-laws of the Corporation and such additional
  documents and instruments as the Parent or the Corporation may reasonably require.
  Payment of the total Redemption Price for such Exchangeable Shares, together
  with payment of such dividends, shall be made by delivery to each holder, at
  the address of the holder recorded in the securities register of the Corporation
  or by holding for pick-up by the holder at the registered office of the Corporation
  in such notice, on behalf of the Corporation of certificates representing shares
  of Parent Common Stock (which shares shall be duly issued as fully paid and
  non-assessable and shall be free and clear of any lien, claim or encumbrance)
  and, if applicable, a cheque of the Corporation payable at par at any branch
  of the bankers of the Corporation in payment of any such dividends, in each
  case, less any amounts withheld on account of tax required to be deducted and
  withheld therefrom. On and after the Redemption Date, the holders of the Exchangeable
  Shares called for redemption shall cease to be holders of such Exchangeable
  Shares and shall not be entitled to exercise any of the rights of holders in
  respect thereof, other than the right to receive their proportionate part of
  the total Redemption Price and any such dividends, unless payment of the total
  Redemption Price and any such dividends for such Exchangeable Shares shall not
  be made upon presentation and surrender of certificates in accordance with the
  foregoing provisions, in 

- 26 - 

which case the rights of the holders shall remain unaffected
  until the total Redemption Price and any such dividends have been paid in the
  manner hereinbefore provided. The Corporation shall have the right at any time
  after the sending of notice of its intention to redeem the Exchangeable Shares
  as aforesaid to deposit or cause to be deposited the total Redemption Price
  for, and the full amount of such dividends on (except as provided in the preceding
  sentence), the Exchangeable Shares so called for redemption, or of such of the
  said Exchangeable Shares represented by certificates that have not at the date
  of such deposit been surrendered by the holders thereof in connection with such
  redemption, in a custodial account with any chartered bank or trust company
  in Canada named in such notice, less any amounts withheld on account of tax
  required to be deducted and withheld therefrom. Upon the later of such deposit
  being made and the Redemption Date, the Exchangeable Shares in respect whereof
  such deposit shall have been made shall be redeemed and the rights of the holders
  thereof after such deposit or Redemption Date, as the case may be, shall be
  limited to receiving their proportionate part of the total Redemption Price
  and such dividends for such Exchangeable Shares so deposited, against presentation
  and surrender of the said certificates held by them, respectively, in accordance
  with the foregoing provisions. Upon such payment or deposit of the total Redemption
  Price and the full amount of such dividends, the holders of the Exchangeable
  Shares shall thereafter be considered and deemed for all purposes to be holders
  of the Parent Common Stock delivered to them or the custodian on their behalf.

ARTICLE 8 

  VOTING RIGHTS 

8.1 Except as required by applicable law and by Article 9 hereof,
  the holders of the Exchangeable Shares shall not be entitled as such to receive
  notice of or to attend any meeting of the shareholders of the Corporation or
  to vote at any such meeting. 

ARTICLE 9 

  AMENDMENT AND APPROVAL 

9.1 The rights, privileges, restrictions and conditions attaching
  to the Exchangeable Shares may be added to, changed or removed but only with
  the approval of the holders of the Exchangeable Shares given as hereinafter
  specified. 

9.2 Any approval given by the holders of the Exchangeable Shares
  to add to, change or remove any right, privilege, restriction or condition attaching
  to the Exchangeable Shares or any other matter requiring the approval or consent
  of the holders of the Exchangeable Shares shall be deemed to have been sufficiently
  given if it shall have been given in accordance with applicable law subject
  to a minimum requirement that such approval be evidenced by resolution passed
  by not less than two-thirds of the votes cast on such resolution at a meeting
  of holders of Exchangeable Shares duly called and held at which the holders
  of at least 25% of the outstanding Exchangeable Shares at that time are present
  or represented by proxy; provided that if at any such meeting the holders of
  at least 25% of the outstanding Exchangeable Shares at that time are not present
  or represented by proxy within one-half hour after the time appointed for such
  meeting, then the meeting shall be adjourned to such date not less than five
  days thereafter and to such time and place as may be designated by the Chairman
  of such meeting. At such adjourned meeting the holders of Exchangeable Shares
  present or represented by proxy thereat may transact the business for which
  the meeting was originally called and a resolution passed thereat by the affirmative
  vote of not less than two-thirds of the votes cast on such resolution at such
  meeting shall constitute the approval or consent of the holders of the Exchangeable
  Shares. 

- 27 - 

ARTICLE 10

  RECIPROCAL CHANGES, ETC. 

  IN RESPECT OF PARENT COMMON STOCK 

10.1 Each holder of an Exchangeable Share acknowledges that the
  Exchangeable Share Support Agreement provides, in part, that Parent will not
  without the prior approval of the Corporation and the prior approval of the
  holders of the Exchangeable Shares given in accordance with Section 9.2 of these
  share provisions: 

	 	(a) 	 issue or distribute Parent Common Stock (or
        securities exchangeable for or convertible into or carrying rights to
        acquire Parent Common Stock) to the holders of all or substantially all
        of the then outstanding Parent Common Stock by way of stock dividend or
        other distribution, other than an issue of Parent Common Stock (or securities
        exchangeable for or convertible into or carrying rights to acquire Parent
        Common Stock) to holders of Parent Common Stock who exercise an option
        to receive dividends in Parent Common Stock (or securities exchangeable
        for or convertible into or carrying rights to acquire Parent Common Stock)
        in lieu of receiving cash dividends;

	 	 	 	 
	 	(b) 	 issue or distribute rights, options or warrants
        to the holders of all or substantially all of the then outstanding Parent
        Common Stock entitling them to subscribe for or to purchase Parent Common
        Stock (or securities exchangeable for or convertible into or carrying
        rights to acquire Parent Common Stock); or

	 	 	 	 
	 	(c) 	 issue or distribute to the holders of all
        or substantially all of the then outstanding Parent Common Stock:

	 	 	 	 
	 		(i) 	 shares or securities of Parent of any class other than
        Parent Common Stock (other than shares convertible into or exchangeable
        for or carrying rights to acquire Parent Common Stock);

	 	 	 	 
	 		(ii) 	 rights, options, warrants or securities other than those
        referred to in Section 10.1(b) above;

	 	 	 	 
	 		(iii) 	 evidences of indebtedness of Parent; or

	 	 	 	 
	 		(iv) 	 any property or assets of Parent,

unless the economic equivalent (as determined by the Board of
  Directors as contemplated by Section 3.6 hereof) on a per share basis of such
  rights, options, securities, shares, evidences of indebtedness or other assets
  is issued or distributed simultaneously to holders of the Exchangeable Shares.

10.2 Each holder of an Exchangeable Share acknowledges that the
  Exchangeable Share Support Agreement further provides, in part, that Parent
  will not without the prior approval of the Corporation and the prior approval
  of the holders of the Exchangeable Shares given in accordance with Section 9.2
  of these share provisions: 

	 	(a) 	 subdivide, redivide or change the then outstanding Parent
        Common Stock into a greater number of Parent Common Stock;

	 	 	 
	 	(b) 	 reduce, combine, consolidate or change the then outstanding
        Parent Common Stock into a lesser number of Parent Common Stock; or

- 28 - 

	 	(c) 	 reclassify or otherwise change the Parent Common Stock
        or effect an amalgamation, merger, reorganization or other transaction
        affecting the Parent Common Stock,

unless the same or an economically equivalent change (as determined
  by the Board of Directors as contemplated by Section 3.6 hereof) shall simultaneously
  be made to, or in, the rights of the holders of the Exchangeable Shares. The
  Exchangeable Share Support Agreement further provides, in part, that the aforesaid
  provisions of the Exchangeable Share Support Agreement shall not be changed
  without the approval of the holders of the Exchangeable Shares given in accordance
  with Section 9.2 of these share provisions. 

ARTICLE 11 

  ACTIONS BY THE CORPORATION UNDER SUPPORT AGREEMENT 

11.1 The Corporation will take all such actions and do all such
  things as shall be necessary or advisable to perform and comply with and to
  ensure performance and compliance by Parent and the Corporation with all provisions
  of the Exchangeable Share Support Agreement applicable to Parent and the Corporation,
  respectively, in accordance with the terms thereof including, without limitation,
  taking all such actions and doing all such things as shall be necessary or advisable
  to enforce to the fullest extent possible for the direct benefit of the Corporation
  all rights and benefits in favour of the Corporation under or pursuant to such
  agreement. 

11.2 The Corporation shall not propose, agree to or otherwise
  give effect to any amendment to, or waiver or forgiveness of its rights or obligations
  under, the Exchangeable Share Support Agreement without the approval of the
  holders of the Exchangeable Shares given in accordance with Section 9.2 of these
  share provisions other than such amendments, waivers and/or forgiveness as may
  be necessary or advisable for the purposes of: 

	 	(a) 	 adding to the covenants of the other parties to such
        agreement for the protection of the Corporation or the holders of the
        Exchangeable Shares thereunder;

	 	 	 
	 	(b) 	 making such provisions or modifications not inconsistent
        with such agreement as may be necessary or desirable with respect to matters
        or questions arising thereunder which, in the good faith opinion of the
        Board of Directors, it may be expedient to make, provided that the Board
        of Directors shall be of the good faith opinion, after consultation with
        counsel, that such provisions and modifications will not be prejudicial
        to the interests of the holders of the Exchangeable Shares; or

	 	 	 
	 	(c) 	 making such changes in or corrections to such agreement
        which, on the advice of counsel to the Corporation, are required for the
        purpose of curing or correcting any ambiguity or defect or inconsistent
        provision or clerical omission or mistake or manifest error contained
        therein, provided that the Board of Directors shall be of the good faith
        opinion, after consultation with counsel, that such changes or corrections
        will not be prejudicial to the interests of the holders of the Exchangeable
        Shares.

ARTICLE 12 

  LEGEND; CALL RIGHTS 

12.1 The certificates evidencing the Exchangeable Shares shall
  contain or have affixed thereto a legend in form and on terms approved by the
  Board of Directors, with respect to the Exchangeable Share Support Agreement,
  the provisions of the Plan of Arrangement relating to the Liquidation Call Right
  and 

- 29 - 

the Redemption Call Right, and the Voting and Exchange Trust
  Agreement (including the provisions with respect to the voting rights, exchange
  right and automatic exchange thereunder). 

12.2 Each holder of an Exchangeable Share, whether of record
  or beneficial, by virtue of becoming and being such a holder shall be deemed
  to acknowledge each of the Liquidation Call Right, the Retraction Call Right
  and the Redemption Call Right, in each case, in favour of Parent, and the overriding
  nature thereof in connection with the liquidation, dissolution or winding-up
  of the Corporation or the retraction or redemption of Exchangeable Shares, as
  the case may be, and to be bound thereby in favour of Parent as therein provided.

ARTICLE 13

  NOTICES; GENERAL 

13.1 Any notice, request or other communication to be given to
  the Corporation by a holder of Exchangeable Shares shall be in writing and shall
  be valid and effective if given by mail (postage prepaid) or by telecopy or
  by delivery to the registered office of the Corporation and addressed to the
  attention of the President. Any such notice, request or other communication,
  if given by mail, telecopy or delivery, shall only be deemed to have been given
  and received upon actual receipt thereof by the Corporation. 

13.2 Any presentation and surrender by a holder of Exchangeable
  Shares to the Corporation of certificates representing Exchangeable Shares in
  connection with the liquidation, dissolution or winding-up of the Corporation
  or the retraction or redemption of Exchangeable Shares shall be made by registered
  mail (postage prepaid) or by delivery to the registered office of the Corporation
  or to such office as may be specified by the Corporation, in each case, addressed
  to the attention of such person as the Corporation may determine. Any such presentation
  and surrender of certificates shall only be deemed to have been made and to
  be effective upon actual receipt thereof by or on behalf of the Corporation,
  as the case may be. Any such presentation and surrender of certificates made
  by registered mail shall be at the sole risk of the holder mailing the same.

13.3 Any notice, request or other communication to be given to
  a holder of Exchangeable Shares by or on behalf of the Corporation shall be
  in writing and shall be valid and effective if given by mail (postage prepaid)
  or by delivery to the address of the holder recorded in the securities register
  of the Corporation or, in the event of the address of any such holder not being
  so recorded, then at the last known address of such holder. Any such notice,
  request or other communication, if given by mail, shall be deemed to have been
  given and received on the third Business Day following the date of mailing and,
  if given by delivery, shall be deemed to have been given and received on the
  date of delivery. Accidental failure or omission to give any notice, request
  or other communication to one or more holders of Exchangeable Shares shall not
  invalidate or otherwise alter or affect any action or proceeding to be taken
  by the Corporation pursuant thereto. 

13.4 If the Corporation determines that mail service is or is
  threatened to be interrupted at the time when the Corporation is required or
  elects to give any notice to the holders of Exchangeable Shares hereunder, the
  Corporation shall, notwithstanding the provisions hereof, give such notice by
  means of publication in The Globe and Mail, national edition, or any other English
  language daily newspaper or newspapers of general circulation in Canada once
  in each of two successive weeks, and notice so published shall be deemed to
  have been given on the latest date on which the first publication has taken
  place. 

     If, by reason of any actual or
  threatened interruption of mail service due to strike, lockout or otherwise,
  any notice to be given to the Corporation would be unlikely to reach its destination
  in a 

- 30 - 

timely manner, such notice shall be valid and effective only
  if delivered personally to the Corporation in accordance with Section 13.1 or
  13.2, as the case may be. 

- 31 - 

SCHEDULE A 

NOTICE OF RETRACTION 

To 6789722 Canada Inc. (the “Corporation”)
  and CounterPath Solutions, Inc. (“Parent”). 

     This notice is given pursuant to
  Article 6 of the provisions (the “Share Provisions”) attaching to
  the Exchangeable Shares of the Corporation represented by the attached certificate
  and all capitalized words and expressions used in this notice that are defined
  in the Share Provisions have the meanings ascribed to such words and expressions
  in such Share Provisions. 

     The undersigned hereby notifies
  the Corporation that, subject to the Retraction Call Right referred to below,
  the undersigned desires to have the Corporation redeem in accordance with Article
  6 of the Share Provisions: 

	 	[ ] 	 all share(s) represented by the attached share certificate;
        or

	 	 	 
	 	[ ] 	 _____ share(s) only.

The undersigned hereby notifies the Corporation that the Retraction
  Date shall be ________

	NOTE: 	 The Retraction Date must be a
        Business Day and must not be less than 10 Business Days nor more than
        15 Business Days after the date upon which this notice is received by
        the Corporation. If no such Business Day is specified above, the Retraction
        Date shall be deemed to be the 15th Business Day after the date on which
        this notice is received by the Corporation. 

     The undersigned acknowledges the
  overriding Retraction Call Right of Parent to purchase all but not less than
  all the Retracted Shares from the undersigned and that this notice is and shall
  be deemed to be a revocable offer by the undersigned to sell the Retracted Shares
  to Parent in accordance with the Retraction Call Right on the Retraction Date
  for the Purchase Price and on the other terms and conditions set out in Section
  6.3 of the Share Provisions. This notice of retraction, and this offer to sell
  the Retracted Shares to Parent, may be revoked and withdrawn by the undersigned
  only by notice in writing given to the Corporation at any time before the close
  of business on the Business Day immediately preceding the Retraction Date. 

     The undersigned acknowledges that
  if, as a result of solvency provisions of applicable law, the Corporation is
  unable to redeem all Retracted Shares, and provided that Parent shall not have
  exercised the Retraction Call Right with respect to the Retracted Shares, the
  undersigned will be deemed to have exercised the Exchange Right (as defined
  in the Voting and Exchange Trust Agreement) so as to require Parent to purchase
  the unredeemed Retracted Shares. 

     The undersigned hereby represents
  and warrants to Parent and the Corporation that the undersigned: 

	 	[ ] 	         is 
	 	 	 
	 	  	(select one) 
	 	 	 
	 	[ ] 	         is not 

- 32 - 

a non-resident of Canada for purposes of the Income Tax Act (Canada).
  The undersigned acknowledges that in the absence of an indication that the
  undersigned is not a non-resident of Canada, withholding on account of Canadian
  tax may be made from amounts payable to the undersigned on the redemption or
  purchase of the Retracted Shares. 

     The undersigned hereby represents
  and warrants to the Corporation and Parent that the undersigned: (i) has good
  title to, and owns, the share(s) represented by this certificate to be acquired
  by Parent or the Corporation, as the case may be, free and clear of all liens,
  claims and encumbrances, and (ii) will complete, sign and return to the Corporation
  or Parent, prior to the redemption of any of the Exchangeable Shares, on request
  by the Corporation or Parent, any documents, questionnaires, notices, certificates
  and undertakings in order to comply with applicable securities laws. 

	 	 	 	 	 
	(Date) 	 	(Signature of Shareholder) 	 	(Guarantee of Signature) 

	 	[ ] 	 Please check box if the securities and any cheque(s)
        resulting from the retraction or purchase of the Retracted Shares are
        to be held for pick-up by the shareholder from the Transfer Agent, failing
        which the securities and any cheque(s) will be mailed to the last address
        of the shareholder as it appears on the register.

	NOTE: 	 This panel must be completed and the attached
        share certificate, together with such additional documents as the Corporation
        and Parent may require, must be deposited with the Corporation or Parent.
        The securities and any cheque(s) resulting from the retraction or purchase
        of the Retracted Shares will be issued and registered in, and made payable
        to, respectively, the name of the shareholder as it appears on the register
        of the Corporation and the securities and any cheque(s) resulting from
        such retraction or purchase will be delivered to such shareholder as indicated
        above, unless the form appearing immediately below is duly completed.
      

Date: ______________________________________________

Name of Person in Whose Name Securities or Cheque(s) 

  Are to be Registered, Issued or Delivered (please print): _____________________________________________________________

Street Address or P.O. Box: ___________________________________________________________________________________

Signature of Shareholder: ____________________________________________________________________________________

City, Province and Postal Code: _______________________________________________________________________________

Signature Guaranteed by: ____________________________________________________________________________________

	NOTE: 	 If this notice of retraction
        is for less than all of the shares represented by the attached certificate,
        a certificate representing the remaining share(s) of the Corporation represented
        by the attached share certificate will be issued and registered in the
        name of the shareholder as it appears on the register of the Corporation,
        unless the Share Transfer Power on the share certificate is duly completed
        in respect of such share(s). 

- 33 - 

 

	
SCHEDULE E
	
	 

	
	
TO THE ARRANGEMENT AGREEMENT AMONG
	
	
COUNTERPATH SOLUTIONS, INC, 6789722 CANADA INC. AND
	
	
NEWHEIGHTS SOFTWARE CORPORATION
	
	 

	
	
PIGGYBACK REGISTRATION RIGHTS AGREEMENT
	

PIGGYBACK REGISTRATION RIGHTS AGREEMENT 

THIS AGREEMENT made the ______ day of June, 2007. 

	BETWEEN: 
	                 
                           COUNTERPATH
      SOLUTIONS, INC., of Suite 300, One 
	                 
                           Bentall
      Centre, 505 Burrard Street, Vancouver, British Columbia, 
	                 
                           Canada,
      V7X 1M3 
	 
	                 
                           (the
      “Company”) 
	AND: 
	                 
                           Each
      of the Persons Executing this Agreement 
	 
	                 
                           (each
      a “Shareholder” and collectively, the “Shareholders”)
    

WHEREAS: 

A. Pursuant to a Plan of Arrangement, the Company acquired, directly
  or indirectly, all of the outstanding voting securities of NewHeights Software
  Corporation (“NewHeights”); 

B. As part of the Plan of Arrangement, certain shareholders of
  NewHeights who were Canadian residents disposed of their common shares in NewHeights
  in exchange for exchangeable preferred shares (the “Exchangeable Shares”)
  of <>, a subsidiary of the Company; 

C. The holders of the Exchangeable Shares, including the Shareholders,
  are entitled, at their election, to exchange their Exchangeable Shares for shares
  of common stock of the Company on a one-for-one basis, subject to adjustment;
  and 

D. The Company wishes to provide certain registration rights
  to the holders of the Exchangeable Shares, including the Shareholders, on the
  terms and conditions of this Agreement. 

NOW THEREFORE THIS AGREEMENT WITNESSES that for good and
  valuable consideration the parties agree as follows: 

	1. 	Piggyback Registration Rights 

1.1 If the Company determines to proceed with the preparation
  and filing with the Securities and Exchange Commission (the “SEC”)
  of a registration statement (the "Registration Statement") relating to an offering
  for its own account or the account of others under the United States Securities
  Act of 1933, as amended (the “1933 Act”), of any shares of its common
  stock, other than on Form S-4 or Form S-8 (each as promulgated under the 1933
  Act) or its then equivalents relating to equity securities issuable in connection
  with stock options or other 

- 2 - 

employee benefit plans, the Company shall send to the Shareholder
  written notice of such determination and, if within thirty (30) days after receipt
  of such notice, the Shareholder shall so request in writing, the Company will
  cause the registration under the 1933 Act of the shares of common stock of the
  Company issued or issuable to the Shareholder upon exchange of the Exchangeable
  Shares held by the Shareholder (the "Registrable Securities"), provided that
  if at any time after giving written notice of its intention to register any
  of its shares of common stock and prior to the effective date of the registration
  statement filed in connection with such registration, the Company shall determine
  for any reason not to register or to delay registration of such shares, the
  Company may, at its election, give written notice of such determination to the
  Shareholder and, thereupon, (i) in the case of a determination not to register,
  shall be relieved of its obligation to register the Registrable Securities in
  connection with such registration, and (ii) in the case of a determination to
  delay registering, shall be permitted to delay registering the Registrable Securities
  for the same period as the delay in registering such other shares. The Company
  shall include in such registration statement all or any part of the Registrable
  Securities provided however that the Company shall not be required to register
  any of the Registrable Shares that are eligible for sale pursuant to Rule 144(k)
  of the 1933 Act. Notwithstanding any other provision in this Agreement, if the
  Company receives a comment from the SEC which effectively results in the Company
  having to reduce the number of shares of common stock being registered on such
  Registration Statement, then the Company may, in its sole discretion, reduce
  on a pro rata basis along with all other shares being registered the number
  of Registrable Securities to be included in such Registration Statement. 

1.2 In connection with each Registration Statement described
  in Section 1.1 hereof, the Shareholder will furnish to the Company in writing
  such information and representation letters with respect to itself and the proposed
  distribution by it as reasonably shall be necessary in order to assure compliance
  with federal and applicable state securities laws. The Company may require the
  Shareholder to furnish to the Company a certified statement as to the number
  of shares of common stock beneficially owned by the Shareholder and the name
  of the person thereof that has voting and dispositive control over the Registrable
  Securities. 

1.3 All fees and expenses incident to the performance of or compliance
  with the filing of the Registration Statement shall be borne by the Company
  whether or not any Registrable Securities are sold pursuant to the Registration
  Statement. The fees and expenses referred to in the foregoing sentence shall
  include, without limitation, (i) all registration and filing fees (including,
  without limitation, fees and expenses (A) with respect to filings required to
  be made with the OTC Bulletin Board or other exchange or quotation service on
  which the common stock of the Company is then listed for trading, and (B) in
  compliance with applicable state securities or Blue Sky laws), (ii) printing
  expenses (including, without limitation, expenses of printing certificates for
  Registrable Securities and of printing prospectuses if the printing of prospectuses
  is reasonably requested by the holders of a majority of the Registrable Securities
  included in the Registration Statement), (iii) messenger, telephone and delivery
  expenses, (iv) fees and disbursements of counsel for the Company, (v) 1933 Act
  liability insurance, if the Company so desires such insurance, and (vi) fees
  and expenses of all other persons retained by the Company in connection with
  the filing of the Registration Statement. In addition, the Company shall be
  responsible for all of its internal expenses incurred in connection with the
  filing of the Registration Statement (including, without limitation, all salaries
  and expenses of its officers and employees performing legal or accounting duties),
  the expense of any annual audit and the fees 

- 3 - 

and expenses incurred in connection with the listing of the Registrable
  Securities on any securities exchange, if applicable. In no event shall the
  Company be responsible for any broker or similar commissions or, except to the
  extent provided for hereunder, any legal fees or other costs of the Shareholder.

1.4 The Company shall, notwithstanding any termination of this
  Agreement, indemnify and hold harmless the Shareholder, and if applicable, its
  officers, directors, agents and employees, and each person who controls the
  Shareholder (within the meaning of Section 15 of the 1933 Act or Section 20
  of the United States Securities Exchange Act of 1934 (the “1934 Act”))
  and the officers, directors, agents and employees of each such controlling person,
  to the fullest extent permitted by applicable law, from and against any and
  all losses, claims, damages, liabilities, costs (including, without limitation,
  reasonable attorneys’ fees) and expenses (collectively, "Losses"), as incurred,
  arising out of or relating to any untrue or alleged untrue statement of a material
  fact contained in the Registration Statement, or in any amendment or supplement
  thereto or in any preliminary prospectus, or arising out of or relating to any
  omission or alleged omission of a material fact required to be stated therein
  or necessary to make the statements therein not misleading, except to the extent,
  but only to the extent, that such untrue statements or omissions (i) are based
  solely upon information regarding the Shareholder furnished in writing to the
  Company by the Shareholder expressly for use therein, or to the extent that
  such information relates to the Shareholder or the Shareholder’s proposed
  method of distribution of Registrable Securities and was reviewed and expressly
  approved in writing by the Shareholder expressly for use in the Registration
  Statement, or in any amendment or supplement thereto, or (ii) are contained
  in an outdated or defective Registration Statement used by the Shareholder after
  the Company has notified the Shareholder in writing that the Registration Statement
  is outdated or defective. 

1.5 The Shareholder shall indemnify and hold harmless the Company,
  its directors, officers, agents and employees, each person who controls the
  Company (within the meaning of Section 15 of the 1933 Act and Section 20 of
  the 1934 Act), and the directors, officers, agents or employees of such controlling
  persons, to the fullest extent permitted by applicable law, from and against
  all Losses, as incurred, to the extent arising out of or based solely upon:
  (x) the Shareholder’s failure to comply with the prospectus delivery requirements
  of the 1933 Act, or (y) any untrue or alleged untrue statement of a material
  fact contained in any Registration Statement, or in any amendment or supplement
  thereto or in any preliminary prospectus, or arising out of or relating to any
  omission or alleged omission of a material fact required to be stated therein
  or necessary to make the statements therein not misleading to the extent, but
  only to the extent, that such untrue statements or omissions (i) are contained
  in any information so furnished in writing by the Shareholder to the Company
  specifically for inclusion in the Registration Statement, or (ii) are based
  solely upon information regarding the Shareholder furnished in writing to the
  Company by the Shareholder expressly for use therein, or (iii) are contained
  in information relating to the Shareholder or the Shareholder’s proposed
  method of distribution of Registrable Securities that was reviewed and expressly
  approved in writing by the Shareholder expressly for use in the Registration
  Statement or in any amendment or supplement thereto, or (z) the use by the Shareholder
  of an outdated or defective Registration Statement after the Company has notified
  the Shareholder in writing that the Registration Statement is outdated or defective.
  In no event shall the liability of the Shareholder hereunder be greater in amount
  than the dollar 

- 4 - 

amount of the net proceeds received by the Shareholder upon the
  sale of the Registrable Securities giving rise to such indemnification obligation.

1.6 If a claim for indemnification hereunder is unavailable to
  either the Company or the Shareholder (in each case, an "Indemnified Party or
  Indemnified Parties", as applicable) (by reason of public policy or otherwise),
  then each Indemnifying Party, in lieu of indemnifying such Indemnified Party,
  shall contribute to the amount paid or payable by such Indemnified Party as
  a result of such Losses, in such proportion as is appropriate to reflect the
  relative fault of the Indemnifying Party and Indemnified Party in connection
  with the actions, statements or omissions that resulted in such Losses as well
  as any other relevant equitable considerations. The relative fault of such Indemnifying
  Party and Indemnified Party shall be determined by reference to, among other
  things, whether any action in question, including any untrue or alleged untrue
  statement of a material fact or omission or alleged omission of a material fact,
  has been taken or made by, or relates to information supplied by, such Indemnifying
  Party or Indemnified Party, and the parties’ relative intent, knowledge,
  access to information and opportunity to correct or prevent such action, statement
  or omission. The amount paid or payable by a party as a result of any Losses
  shall be deemed to include, subject to the limitations set forth in this Agreement,
  any reasonable attorneys’ or other reasonable fees or expenses incurred
  by such party in connection with any proceeding to the extent such party would
  have been indemnified for such fees or expenses if the indemnification provided
  for in this section was available to such party in accordance with its terms.
  The parties hereto agree that it would not be just and equitable if contribution
  pursuant to this section were determined by pro rata allocation or by any other
  method of allocation that does not take into account the equitable considerations
  referred to in the immediately preceding paragraph. Notwithstanding the provisions
  of this section, no Shareholder shall be required to contribute, in the aggregate,
  any amount in excess of the amount by which the proceeds actually received by
  the Shareholder from the sale of the Registrable Securities subject to the proceeding
  exceeds the amount of any damages that the Shareholder has otherwise been required
  to pay by reason of such untrue or alleged untrue statement or omission or alleged
  omission, except in the case of fraud by the Shareholder. 

	2. 	Governing Law 

2.1 This Agreement is governed by the laws of the Province of
  British Columbia. 

	3. 	Assignment 

3.1 This Agreement may be assigned by the Shareholder to any
  person who purchases or otherwise acquires any of the Exchangeable Shares from
  the Shareholder. 

	4. 	Severability 

4.1 The invalidity or unenforceability of any particular provision
  of this Agreement shall not affect or limit the validity or enforceability of
  the remaining provisions of this Agreement. 

- 5 - 

	5. 	Entire Agreement 

5.1 Except as expressly provided in this Agreement and in the
  agreements, instruments and other documents contemplated or provided for herein,
  this Agreement contains the entire agreement between the parties with respect
  to the sale of the Securities and there are no other terms, conditions, representations
  or warranties, whether expressed, implied, oral or written, by statute or common
  law, by the Company or by anyone else. 

	6. 	Counterparts 

6.1 This Agreement may be executed in several counterparts, each
  of which will be deemed to be an original and all of which will together constitute
  one and the same instrument. 

	7. 	Notices 

7.1 Any notice required or permitted to be given under this Agreement
  will be in writing and may be given by delivering, sending by electronic facsimile
  transmission or other means of electronic communication capable of producing
  a printed copy, or sending by prepaid registered mail posted in Canada, the
  notice to the following address or number: 

If to the Company: 

CounterPath Solutions, Inc. 

  Suite 300 One Bentall Centre 

  505 Burrard Street 

  Vancouver, British Columbia, Canada, V7X 1M3 

Facsimile No.: 604-320-3399 

If to the Shareholder, at the address
  and facsimile number given on the execution pages hereof. 

(or to such other address or number as any party may specify
  by notice in writing to another party). 

7.2 Any notice delivered or sent by electronic facsimile transmission
  or other means of electronic communication capable of producing a printed copy
  on a business day will be deemed conclusively to have been effectively given
  on the day the notice was delivered, or the transmission was sent successfully
  to the number set out above, as the case may be. 

7.3 Any notice sent by prepaid registered mail will be deemed
  conclusively to have been effectively given on the third business day after
  posting; but if at the time of posting or between the time of posting and the
  third business day thereafter there is a strike, lockout, or other labour disturbance
  affecting postal service, then the notice will not be effectively given until
  actually delivered. 

- 6 - 

	8. 	Counterparts and Electronic Means
    

8.1 This Agreement may be executed in any number of counterparts,
  each of which, when so executed and delivered, shall constitute an original
  and all of which together shall constitute one instrument. Delivery of an executed
  copy of this Agreement by electronic facsimile transmission or other means of
  electronic communication capable of producing a printed copy will be deemed
  to be execution and delivery of this Agreement as of the date hereinafter set
  forth. 

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

COUNTERPATH SOLUTIONS, INC. 

	 Per: 		 
	 	Authorized Signatory 	 

	EXECUTED by the named Shareholder in 	)	
	the presence of: 	)	
	 	)	 
	 	)	 
	Signature 	)	 Signature of Shareholder or Authorized 
	  	)	 Signatory 
	Print Name 	)	
		)	 
	Address 	)	 Name of Shareholder 
		)	 
	 	)	 
	  	)	 Name of Authorized Signatory (if applicable)
    
	Occupation 	)	  
		)	 
	  	 	  
	  	 	  
	  	 	Address 
	 	 	 
	  	 	Facsimile No. 

- 7 - 

	EXECUTED by the named Shareholder in 	)	
	the presence of: 	)	
		)	 
	 	)	 
	Signature 	)	Signature of Shareholder or Authorized 
	  	)	Signatory 
	Print Name 	)	
		)	 
	Address 	)	Name of Shareholder 
	 	)	 
		)	 
	  	)	Name of Authorized Signatory (if applicable) 
	Occupation 	)	
	  	 	  
	 	 	 
	  	 	  
	  	 	       Address 
	 	 	 
	  	 	       Facsimile No. 
	  	 	  
	  	 	  
	  	 	  
	EXECUTED by the named Shareholder in 	)	
	the presence of: 	)	 
	 	)	 
	 	)	 
	Signature 	)	Signature of Shareholder or Authorized 
	  	)	Signatory 
	Print Name 	)	
		)	 
	Address 	)	Name of Shareholder 
		 )	 
		)	 
	  	)	Name of Authorized Signatory (if applicable) 
	Occupation 	)	
	 	 	 
	  	 	  
	  	 	  
	  	 	       Address 
	 	 	 
	  	 	       Facsimile No. 

- 8 - 

	EXECUTED by the named Shareholder in 	)	
	the presence of: 	)	
	 	)	 
		)	 
	Signature 	)	Signature of Shareholder or Authorized 
	  	)	Signatory 
	Print Name 	)	
	 	)	 
	Address 	) 	Name of Shareholder 
	 	)	 
	 	)	 
	  	)	Name of Authorized Signatory (if applicable) 
	Occupation 	)	
	 	 	 
	 	 	
	  	 	  
	  	 	       Address 
	 	 	 
	  	 	       Facsimile No. 

 

	
SCHEDULE F
	
	 

	
	
TO THE ARRANGEMENT AGREEMENT AMONG
	
	
COUNTERPATH SOLUTIONS, INC, 6789722 CANADA INC. AND
	
	
NEWHEIGHTS SOFTWARE CORPORATION
	
	 

	
	
VOTING AND EXCHANGE TRUST AGREEMENT
	

FORM OF VOTING AND EXCHANGE TRUST AGREEMENT 

AGREEMENT made as of the 15th day of June, 2007. 

	AMONG: 
	                 
                           6789722
      CANADA INC., a corporation existing under the laws of 
	                 
                           Canada
      (“ExchangeCo”) 
	AND 
	                 
                           COUNTERPATH
      SOLUTIONS, INC., a corporation existing under 
	                 
                           the
      laws of the State of Nevada (“Parent”) 
	AND 
	                 
                           VALIANT
      TRUST COMPANY, a trust company incorporated under 
	                 
                           the
      laws of Canada (“Trustee”) 

WHEREAS: 

A. Pursuant to an arrangement agreement (the “Arrangement
  Agreement”) dated as of June 15, 2007 among Parent, ExchangeCo and
  NewHeights Software Corporation (the “Company”), ExchangeCo
  has agreed to issue exchangeable shares (the “Exchangeable Shares”)
  to certain holders of common shares of the Company pursuant to the plan of arrangement
  (the “Plan of Arrangement”) contemplated by the Arrangement
  Agreement; and 

B. Pursuant to the Arrangement Agreement, Parent and ExchangeCo
  have agreed to execute a voting and exchange trust agreement substantially in
  the form of this Agreement; and 

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

ARTICLE 1 

  DEFINITIONS AND INTERPRETATION 

	1.1 	Definitions 

     In this Agreement, the following terms
  shall have the following meanings: 

     “Affiliate” of
  any Person means any other Person directly or indirectly controlling, controlled
  by, or under common control with, that Person. For the purposes of this definition,
  “control” (including, with correlative meanings, the terms “controlled
  by” and “under common control with”), as applied to any Person,
  means the possession by another Person, directly or indirectly, of the power
  to direct or cause the direction of the management and policies of that first
  mentioned Person, whether through the ownership of voting securities, by contract
  or otherwise. 

     “Arrangement”
  means the arrangement under section 192 of the CBCA on the terms and subject
  to the conditions set forth in the Arrangement Agreement and the Plan of Arrangement
  and any 

amendments or variations to the Plan of Arrangement made in accordance
  with Article 6 of the Plan of Arrangement or made at the direction of the Court
  in the Final Order. 

     “Arrangement Agreement”
  means the agreement made as of June 15, 2007 between Parent, ExchangeCo and
  the Company, as amended, supplemented and/or restated in accordance therewith,
  providing for, among other things, the Arrangement. 

     “Assignee” has the
  meaning ascribed to that term in Section 12.3.

     “Authorized Person”
  has the meaning ascribed to that term in Section 6.17. 

     “Automatic Exchange Rights”
  means the benefit of the obligation of Parent to effect the automatic exchange
  of Parent Common Shares for Exchangeable Shares pursuant to Section 5.13. 

     “Beneficiaries”
  means the registered holders from time to time of Exchangeable Shares, other
  than Parent and the Parent Affiliates. 

     “Beneficiary Votes”
  has the meaning ascribed to that term in Section 4.2. 

     “Board of Directors”
  means the Board of Directors of ExchangeCo or Parent, as the case may be. 

     “Business Day”
  means any day on which commercial banks are generally open for business in Vancouver,
  British Columbia, other than a Saturday, a Sunday or a day observed as a holiday
  in Vancouver, British Columbia under the laws of the Province of British Columbia
  or the federal laws of Canada. 

     “Canadian Dollar Equivalent”
  means, in respect of an amount expressed in a currency other than Canadian dollars
  (the “Foreign Currency Amount”) at any date, the product obtained
  by multiplying: (a) the Foreign Currency Amount, by (b) the noon spot exchange
  rate on such date for such foreign currency expressed in Canadian dollars as
  reported by the Bank of Canada or, in the event such spot exchange rate is not
  available, such exchange rate on such date for such foreign currency expressed
  in Canadian dollars as may be deemed by the Board of Directors to be appropriate
  for such purpose. 

     “CBCA” means the
  Canada Business Corporations Act as now in effect and as may be amended
  from time to time prior to the date upon which the Plan of Arrangement becomes
  effective as set forth in the certificate of arrangement giving effect to the
  Arrangement issued by the director pursuant to section 192 of the Canada
  Business Corporations Act, including the regulations made thereunder. 

     “Current Market Price”
  means, in respect of a Parent Common Share on any date, the Canadian Dollar
  Equivalent of the average of the closing prices of Parent Common Shares during
  a period of 20 consecutive trading days ending not more than three trading days
  before such date on the OTC Bulletin Board, or, if the Parent Common Shares
  are not then quoted on the OTC Bulletin Board, on such other stock exchange
  or automated quotation system on which the Parent Common Shares are listed or
  quoted, as the case may be, as may be selected by the Board of Directors of
  Parent for such purpose; provided, however, that if in the opinion of the Board
  of Directors of Parent the public distribution or trading activity of Parent
  Common Shares during such period does not create a market which reflects the
  fair market value of a Parent Common Shares, then the Current Market Price of
  a Parent Common Share shall be determined by the Board of Directors of Parent,
  in good faith and in its sole discretion, and provided further that any such
  selection, opinion or determination by the Board of Directors of Parent shall
  be conclusive and binding. 

- 2 - 

     “Entity” means
  any corporation (including any non-profit corporation), general partnership,
  limited partnership, limited liability partnership, joint venture, estate, trust,
  company (including any company limited by shares, limited liability company
  or joint stock company), firm, society or other enterprise, association, organization
  or entity. 

     “Exchange Right” has
  the meaning ascribed to that term in Section 5.1. 

     “Exchangeable Share”
  means a share in the class of non-voting exchangeable shares in the capital
  of ExchangeCo having the rights, privileges, restrictions and conditions set
  forth in the Exchangeable Share Provisions. 

     “Exchangeable Share Provisions”
  means the rights, privileges, restrictions and conditions attaching to the Exchangeable
  Shares as set forth in Appendix 1 to the Plan of Arrangement. 

     “Exchangeable Share Support
  Agreement” means the exchangeable share support agreement made as of
  even date herewith among ExchangeCo and Parent. 

     “Governmental Body”
  means any: (a) nation, state, commonwealth, province, territory, county, municipality,
  district or other jurisdiction of any nature; (b) federal, state, provincial,
  local, municipal, foreign or other government; or (c) governmental or quasi-governmental
  authority of any nature (including any governmental division, department, agency,
  commission, instrumentality, official, ministry, fund, foundation, center, organization,
  unit, body or Entity and any court or other tribunal). 

     “Indemnified Parties”
  has the meaning ascribed to that term in Section 8.1. 

     “Insolvency Event”
  means the institution by ExchangeCo of any proceeding to be adjudicated a bankrupt
  or insolvent or to be wound up, or the consent of ExchangeCo to the institution
  of bankruptcy, insolvency or winding-up proceedings against ExchangeCo, or the
  filing of a petition, answer or consent seeking dissolution or winding-up under
  any bankruptcy, insolvency or analogous laws, including without limitation the
  Companies Creditors Arrangement Act (Canada) and the Bankruptcy and Insolvency
  Act (Canada), and the failure by ExchangeCo to contest in good faith any such
  proceedings commenced in respect of ExchangeCo within 30 days of becoming aware
  thereof, or the consent by ExchangeCo to the filing of any such petition or
  to the appointment of a receiver, or the making by ExchangeCo of a general assignment
  for the benefit of creditors, or the admission in writing by ExchangeCo of its
  inability to pay its debts generally as they become due, or ExchangeCo not being
  permitted, pursuant to solvency requirements of applicable law, to redeem any
  Retracted Shares pursuant to Section 6.6 of the Exchangeable Share Provisions.

     “Liquidation Call Right”
  has the meaning ascribed to that term in the Plan of Arrangement.

     “Liquidation Event”
  has the meaning ascribed to that term in Section 5.13(b) .

     “Liquidation Event Effective
  Date” has the meaning ascribed to that term in Section 5.13(c) .

     “List” has the meaning
  ascribed to that term in Section 4.6. 

     “Officers Certificate”
  means, with respect to Parent or ExchangeCo, as the case may be, a certificate
  signed by any one of the authorized signatories of Parent or ExchangeCo, as
  the case may be. 

- 3 - 

     “Parent Affiliates”
  means Affiliates of Parent. 

     “Parent Common Share”
  means a share of common stock, par value U.S. $0.001 per share, in the capital
  of Parent, and any other security into which such share may be changed. 

     “Parent Consent” has
  the meaning ascribed to that term in Section 4.2.

      “Parent Meeting”
  has the meaning ascribed to that term in Section 4.2. 

     “Parent Special Voting
  Share” means the one share of special voting stock of Parent, par value
  U.S.$0.001, which entitles the holder of record of that share to a number of
  votes at meetings of holders of Parent Common Shares equal to the number of
  Exchangeable Shares outstanding from time to time (other than Exchangeable Shares
  held by Parent and Parent Affiliates). 

     “Parent Successor”
  has the meaning ascribed to that term in Section 10.1. 

     “Person” means any
  individual, Entity or Governmental Body. 

     “Plan of Arrangement”
  means the plan of arrangement appended as Schedule D to the Arrangement Agreement.

     “Redemption Call Right”
  has the meaning ascribed to that term in the Plan of Arrangement.

     “Retracted Shares”
  has the meaning ascribed to that term in Section 5.7. 

     “Retraction Call Right”
  has the meaning ascribed to that term in the Exchangeable Share Provisions.

     “Trust” means the trust
  created by this Agreement. 

     “Trust Estate”
  means the Parent Special Voting Share, any other securities, the Exchange Right,
  the Automatic Exchange Rights and any money or other property which may be held
  by the Trustee from time to time pursuant to this trust agreement. 

     “Trustee” means
  Valiant Trust Company or such other trust company or other Entity that Parent
  and the Company choose and, subject to the provisions of Article 9, includes
  any successor trustee. 

     “Voting Rights”
  means the voting rights attached to the Parent Special Voting Share as set forth
  in Article 4. 

	1.2 	Interpretation Not Affected by Headings, etc.
    

     The division of this Agreement
  into Articles, Sections and other portions and the insertion of headings are
  for convenience of reference only and should not affect the construction or
  interpretation of this Agreement. Unless otherwise indicated, all references
  to an “Article” or “Section” followed by a number and/or
  a letter refer to the specified Article or Section of this Agreement. The terms
  “this Agreement”, “hereof”, “herein” and “hereunder”
  and similar expressions refer to this Agreement and not to any particular Article,
  Section or other portion hereof and include any agreement or instrument supplementary
  or ancillary hereto. 

- 4 - 

	1.3 	Number, Gender, etc. 

     Words importing the singular number
  only shall include the plural and vice versa. Words importing any gender shall
  include all genders. 

	1.4 	Date for any Action 

     If any date on which any action
  is required to be taken under this Agreement is not a Business Day, such action
  shall be required to be taken on the next succeeding Business Day. 

ARTICLE 2 

  PURPOSE OF AGREEMENT 

	2.1 	Establishment of Trust 

     The purpose of this Agreement is
  to create the Trust for the benefit of the Beneficiaries, as herein provided.
  The Trustee will hold the Parent Special Voting Share in order to enable the
  Trustee to execute the Voting Rights and will hold the Exchange Right and the
  Automatic Exchange Rights in order to enable the Trustee to exercise such rights,
  in each case as trustee for and on behalf of the Beneficiaries as provided in
  this Agreement. 

ARTICLE 3 

  PARENT SPECIAL VOTING SHARE 

	3.1 	Issue and Ownership of the Parent Special Voting
      Share 

     Parent hereby issues to and deposits
  with the Trustee, the Parent Special Voting Share to be hereafter held of record
  by the Trustee as trustee for and on behalf of, and for the use and benefit
  of, the Beneficiaries and in accordance with the provisions of this Agreement.
  Parent hereby acknowledges receipt from the Trustee as trustee for and on behalf
  of the Beneficiaries of good and valuable consideration (and the adequacy thereof)
  for the issuance of the Parent Special Voting Share by Parent to the Trustee.
  During the term of the Trust and subject to the terms and conditions of this
  Agreement, the Trustee shall possess and be vested with full legal ownership
  of the Parent Special Voting Share and shall be entitled to exercise all of
  the rights and powers of an owner with respect to the Parent Special Voting
  Share provided that the Trustee shall: 

	 	(a) 	 hold the Parent Special Voting Share and the legal title
        thereto as trustee solely for the use and benefit of the Beneficiaries
        in accordance with the provisions of this Agreement; and

	 	 	 
	 	(b) 	 except as specifically authorized by this Agreement,
        have no power or authority to sell, transfer, vote or otherwise deal in
        or with the Parent Special Voting Share and the Parent Special Voting
        Share shall not be used or disposed of by the Trustee for any purpose
        other than the purposes for which this Trust is created pursuant to this
        Agreement.

	3.2 	Legended Share Certificates 

     ExchangeCo will cause each certificate
  representing Exchangeable Shares to bear an appropriate legend notifying the
  Beneficiaries of their right to instruct the Trustee with respect to the exercise
  of the Voting Rights in respect of the Exchangeable Shares of the Beneficiaries.

- 5 - 

	3.3 	Safe Keeping of Certificate 

     The certificate representing the
  Parent Special Voting Share shall at all times be held in safe keeping by the
  Trustee or its duly authorized agent. 

ARTICLE 4 

  EXERCISE OF VOTING RIGHTS 

	4.1 	Voting Rights 

     The Trustee, as the holder of record
  of the Parent Special Voting Share, shall be entitled to vote in person or by
  proxy the Parent Special Voting Share on any matters, questions, proposals or
  propositions whatsoever that may properly come before the holders of Parent
  Common Shares at a Parent Meeting or in connection with a Parent Consent. The
  Voting Rights shall be and remain vested in and exercised by the Trustee. Subject
  to Section 6.15: 

	 	(a) 	 the Trustee shall exercise the Voting Rights only on
        the basis of instructions received in accordance with this Article 4 from
        Beneficiaries entitled to instruct the Trustee as to the voting thereof
        at the time at which the Parent Meeting is held or a Parent Consent is
        sought; and

	 	 	 
	 	(b) 	 to the extent that no instructions are received from
        a Beneficiary with respect to the Voting Rights to which such Beneficiary
        is entitled, the Trustee shall not exercise or permit the exercise of
        such Voting Rights.

	4.2 	Number of Votes 

     With respect to all meetings of
  stockholders of Parent at which holders of Parent Common Shares are entitled
  to vote (each, a “Parent Meeting”) and with respect to all
  written consents sought by Parent from its stockholders including the holders
  of Parent Common Shares (each, a “Parent Consent”), each Beneficiary
  shall be entitled to instruct the Trustee to cast and exercise one of the votes
  comprised in the Voting Rights for each Exchangeable Share owned of record by
  such Beneficiary on the record date established by Parent or by applicable law
  for such Parent Meeting or Parent Consent, as the case may be (the “Beneficiary
  Votes”), in respect of each matter, question, proposal or proposition
  to be voted on at such Parent Meeting or in connection with such Parent Consent.

	4.3 	Mailings to Stockholders 

     With respect to each Parent Meeting
  and Parent Consent, the Trustee will mail or cause to be mailed (or otherwise
  communicate in the same manner as Parent utilizes in communications to holders
  of Parent Common Shares subject to the Trustee being advised in writing of that
  method and its ability to provide that method of communication) to each of the
  Beneficiaries named in the List referred to in Section 4.6, the following materials
  (such mailing or communication to commence on the same day as the mailing (or
  other communication) is commenced by Parent to its stockholders or, if later,
  promptly after receipt by the Trustee of such materials): 

	 	(a) 	 a copy of the notice of such Parent Meeting or such
        Parent Consent, together with any related materials to be provided to
        stockholders of Parent;

	 	 	 
	 	(b) 	 a statement that such Beneficiary is entitled to instruct
        the Trustee as to the exercise of the Beneficiary Votes with respect to
        such Parent Meeting or Parent Consent or, pursuant

- 6 - 

	 		 to Section 4.7, to attend such Parent Meeting
        and to exercise personally the Beneficiary Votes thereat;

	 	 	 	 
	 	(c) 	 a statement as to the manner in which such
        instructions may be given to the Trustee, including an express indication
        that instructions may be given to the Trustee to give:

	 	 	 	 
	 		(i) 	 a proxy to such Beneficiary or his designee to exercise
        personally the Beneficiary Votes; or

	 	 	 	 
	 		(ii) 	 a proxy to a designated agent or other representative
        of the management of Parent to exercise such Beneficiary Votes;

	 	 	 	 
	 	(d) 	 a statement that if no such instructions are
        received from the Beneficiary, the Beneficiary Votes to which such Beneficiary
        is entitled will not be exercised;

	 	 	 	 
	 	(e) 	 a form of direction whereby the Beneficiary
        may instruct the Trustee as to voting and otherwise as contemplated herein;
        and

	 	 	 	 
	 	(f) 	 a statement of the time and date by which
        such instructions must be received by the Trustee in order to be binding
        upon it, which, in the case of a Parent Meeting, shall be not later than
        the close of business on the second Business Day prior to such meeting,
        and of the method for revoking or amending such instructions.

     For the purpose of determining
  Beneficiary Votes to which a Beneficiary is entitled in respect of any Parent
  Meeting or Parent Consent, the number of Exchangeable Shares owned of record
  by the Beneficiary shall be determined at the close of business on the record
  date established by Parent or by applicable law for purposes of determining
  stockholders entitled to vote at such Parent Meeting or sign such Parent Consent.
  Parent will notify the Trustee of any decision of the Board of Directors of
  Parent with respect to the calling of any Parent Meeting or with respect to
  the seeking of any Parent Consent and shall provide all necessary information
  and materials to the Trustee in each case promptly and in any event in sufficient
  time to enable the Trustee to perform its obligations contemplated by this Section
  4.3. 

	4.4 	Copies of Stockholder Information 

     Parent will deliver to the Trustee
  copies of all proxy materials (including notices of Parent Meetings but excluding
  proxies to vote Parent Common Shares), information statements, reports (including
  without limitation, all interim and annual financial statements) and other written
  communications that, in each case, are to be distributed from time to time to
  holders of Parent Common Shares in sufficient quantities and in sufficient time
  so as to enable the Trustee to send those materials to each Beneficiary at the
  same time as such materials are first sent to holders of Parent Common Shares.
  The Trustee will mail or otherwise send to each Beneficiary, at the expense
  of Parent, copies of all such materials (and all materials specifically directed
  to the Beneficiaries or to the Trustee for the benefit of the Beneficiaries
  by Parent) received by the Trustee from Parent and will use its best efforts
  to mail or otherwise send such materials contemporaneously with the sending
  by Parent or its designee of such materials to holders of Parent Common Shares.
  The Trustee will also make available for inspection by any Beneficiary at the
  Trustee’s principal corporate trust office in the City of Vancouver during
  the regular business hours of the Trustee all proxy materials, information statements,
  reports and other written communications that are: 

	 	(a) 	 received by the Trustee as the registered holder of
        the Parent Special Voting Share and made available by Parent generally
        to the holders of Parent Common Shares; or

- 7 - 

	 	(b) 	 specifically directed to the Beneficiaries or to the
        Trustee for the benefit of the Beneficiaries by Parent.

	4.5 	Other Materials 

     As soon as reasonably practicable
  after receipt by Parent or stockholders of Parent (if such receipt is known
  by Parent) of any material sent or given by or on behalf of a third party to
  holders of Parent Common Shares generally, including without limitation, dissident
  proxy and information circulars (and related information and material) and tender
  and exchange offer circulars (and related information and material), Parent
  shall use its reasonable efforts to obtain and deliver to the Trustee copies
  thereof in sufficient quantities so as to enable the Trustee to forward such
  material (unless the same has been provided directly to Beneficiaries by such
  third party) to each Beneficiary as soon as possible thereafter. As soon as
  reasonably practicable after receipt thereof, the Trustee will mail or otherwise
  send to each Beneficiary, at the expense of Parent, copies of all such materials
  received by the Trustee from Parent. The Trustee will also make available for
  inspection by any Beneficiary at the Trustee’s principal corporate trust
  office in the City of Vancouver during the regular business hours of the Trustee
  copies of all such materials. 

	4.6 	List of Persons Entitled to Vote 

     ExchangeCo shall, (a) prior to
  each annual general and special Parent Meeting or the seeking of any Parent
  Consent and (b) forthwith upon each request made at any time by the Trustee
  in writing, prepare or cause to be prepared a list (a “List”)
  of the names and addresses of the Beneficiaries arranged in alphabetical order
  (and, if requested, arranged by jurisdiction of residence) and showing the number
  of Exchangeable Shares held of record by each such Beneficiary, in each case
  at the close of business on the date specified by the Trustee in such request
  or, in the case of a List prepared in connection with a Parent Meeting or a
  Parent Consent, at the close of business on the record date established by Parent
  or pursuant to applicable law for determining the holders of Parent Common Shares
  entitled to receive notice of and/or to vote at such Parent Meeting or to give
  consent in connection with such Parent Consent. Each such List shall be delivered
  to the Trustee promptly after receipt by ExchangeCo of such request or the record
  date for such meeting or seeking of consent, as the case may be, and in any
  event within sufficient time to enable the Trustee to perform its obligations
  under this Agreement. Parent agrees to give ExchangeCo notice (with a copy to
  the Trustee) of the calling of any Parent Meeting or the seeking of any Parent
  Consent, together with the record dates therefor, sufficiently prior to the
  date of the calling of such meeting or seeking of such consent so as to enable
  ExchangeCo to perform its obligations under this Section 4.6. 

	4.7 	Entitlement to Direct Votes 

     Any Beneficiary named in a List
  prepared in connection with any Parent Meeting or Parent Consent will be entitled
  (a) to instruct the Trustee in the manner described in Section 4.3 with respect
  to the exercise of the Beneficiary Votes to which such Beneficiary is entitled
  or (b) to attend such meeting and personally exercise thereat, as the proxy
  of the Trustee, the Beneficiary Votes to which such Beneficiary is entitled.

	4.8 	 Voting by Trustee, and Attendance of Trustee
        Representative at Meeting

	 	 	 
		(a) 	 In connection with each Parent Meeting and Parent Consent,
        the Trustee shall exercise, either in person or by proxy, in accordance
        with the instructions received from a Beneficiary pursuant to Section
        4.3, the Beneficiary Votes as to which such Beneficiary is entitled to
        direct the vote (or any lesser number thereof as may be set forth in the

- 8 - 

	 		 instructions); provided, however, that such written
        instructions are received by the Trustee from the Beneficiary prior to
        the time and date fixed by the Trustee for receipt of such instruction
        in the notice given by the Trustee to the Beneficiary pursuant to Section
        4.3.

	 	 	 
	 	(b) 	 Subject to the timely receipt of instructions as contemplated
        in Section 4.3(f), the Trustee shall cause a representative who is empowered
        by it to sign and deliver, on behalf of the Trustee, proxies for Voting
        Rights to attend each Parent Meeting. Upon submission by a Beneficiary
        (or its designee) of identification satisfactory to the Trustee’s
        representative, and at the Beneficiary’s request, such representative
        shall sign and deliver to such Beneficiary (or its designee) a proxy to
        exercise personally the Beneficiary Votes as to which such Beneficiary
        is otherwise entitled hereunder to direct the vote, if such Beneficiary
        either (i) has not previously given the Trustee instructions pursuant
        to Section 4.3 in respect of such meeting or (ii) submits to such representative
        written revocation of any such previous instructions. At such meeting,
        the Beneficiary exercising such Beneficiary Votes shall have the same
        rights as the Trustee to speak at the meeting in favour of any matter,
        question, proposal or proposition, to vote by way of ballot at the meeting
        in respect of any matter, question, proposal or proposition, and to vote
        at such meeting by way of a show of hands in respect of any matter, question
        or proposition.

	4.9 	Distribution of Written Materials 

     Any written materials distributed
  by the Trustee pursuant to this Agreement shall be sent by mail (or otherwise
  communicated in the same manner as Parent utilizes in communications to holders
  of Parent Common Shares subject to the Trustee being advised in writing of that
  method of communication and its ability to provide that method of communication)
  to each Beneficiary at its address as shown on the books of ExchangeCo. ExchangeCo
  shall provide or cause to be provided to the Trustee for this purpose, on a
  timely basis and without charge or other expense: 

	 	(a) 	 a current List; and

	 	 	 
	 	(b) 	 upon the request of the Trustee, mailing labels to enable
        the Trustee to carry out its duties under this Agreement.

	4.10 	Termination of Voting Rights 

     All of the rights of a Beneficiary
  with respect to the Beneficiary Votes exercisable in respect of the Exchangeable
  Shares held by such Beneficiary, including the right to instruct the Trustee
  as to the voting of or to vote personally such Beneficiary Votes, shall be deemed
  to be surrendered by the Beneficiary to Parent, and such Beneficiary Votes and
  the Voting Rights represented thereby shall cease immediately upon the delivery
  by such holder to the Trustee of the certificates representing such Exchangeable
  Shares in connection with the exercise by the Beneficiary of the Exchange Right
  or the occurrence of the automatic exchange of Exchangeable Shares for Parent
  Common Shares, as specified in Article 5 (unless, in either case, Parent shall
  not have delivered the requisite Parent Common Shares issuable in exchange for
  the Exchangeable Shares to the Trustee for delivery to the Beneficiaries), or
  upon the redemption of Exchangeable Shares pursuant to Article 6 or 7 of the
  Exchangeable Share Provisions, or upon the effective date of the liquidation,
  dissolution or winding-up of ExchangeCo pursuant to Article 5 of the Exchangeable
  Share Provisions, or upon the purchase of Exchangeable Shares from the holder
  thereof by ExchangeCo pursuant to the exercise by ExchangeCo of the Retraction
  Call Right, the Redemption Call Right or the Liquidation Call Right. 

- 9 - 

ARTICLE 5

  EXCHANGE RIGHT AND AUTOMATIC EXCHANGE 

	5.1 	Grant and Ownership of the Exchange Right
    

     Parent hereby grants to the Trustee
  as trustee for and on behalf of, and for the use and benefit of, the Beneficiaries
  the right (the “Exchange Right”), exercisable upon the occurrence
  and during the continuance of an Insolvency Event, to require Parent to purchase
  from each or any Beneficiary all or any part of the Exchangeable Shares held
  by the Beneficiary and the Automatic Exchange Rights, all in accordance with
  the provisions of this Agreement. Parent hereby acknowledges receipt from the
  Trustee as trustee for and on behalf of the Beneficiaries of good and valuable
  consideration (and the adequacy thereof) for the grant of the Exchange Right
  and the Automatic Exchange Rights by Parent to the Trustee. During the term
  of the Trust and subject to the terms and conditions of this Agreement, the
  Trustee shall possess and be vested with full legal ownership of the Exchange
  Right and the Automatic Exchange Rights and shall be entitled to exercise all
  of the rights and powers of an owner with respect to the Exchange Right and
  the Automatic Exchange Rights, provided that the Trustee shall: 

	 	(a) 	 hold the Exchange Right and the Automatic Exchange Rights
        and the legal title thereto as trustee solely for the use and benefit
        of the Beneficiaries in accordance with the provisions of this Agreement;
        and

	 	 	 
	 	(b) 	 except as specifically authorized by this Agreement,
        have no power or authority to exercise or otherwise deal in or with the
        Exchange Right or the Automatic Exchange Rights, and the Trustee shall
        not exercise any such rights for any purpose other than the purposes for
        which the Trust is created pursuant to this Agreement.

	5.2 	Legended Share Certificates 

     ExchangeCo will cause each certificate
  representing Exchangeable Shares to bear an appropriate legend notifying the
  Beneficiaries of: 

	 	(a) 	 their right to instruct the Trustee with respect to
        the exercise of the Exchange Right in respect of the Exchangeable Shares
        held by a Beneficiary; and

	 	 	 
	 	(b) 	 the Automatic Exchange Rights.

	5.3 	General Exercise of Exchange Right 

     The Exchange Right shall be and
  remain vested in and exercisable by the Trustee. Subject to Section 6.15, the
  Trustee shall exercise the Exchange Right only on the basis of instructions
  received pursuant to this Article 5 from Beneficiaries entitled to instruct
  the Trustee as to the exercise thereof. To the extent that no instructions are
  received from a Beneficiary with respect to the Exchange Right, the Trustee
  shall not exercise or permit the exercise of the Exchange Right. 

	5.4 	Purchase Price 

     The purchase price payable by Parent
  for each Exchangeable Share to be purchased by Parent under the Exchange Right
  shall be an amount per share equal to (a) the Current Market Price of a Parent
  Common Share on the last Business Day prior to the day of closing of the purchase
  and sale of such Exchangeable Share under the Exchange Right, which shall be
  satisfied in full by Parent causing to 

- 10 - 

be sent to such holder one Parent Common Share, plus (b) to the
  extent not paid by ExchangeCo, an additional amount equivalent to the full amount
  of all declared and unpaid dividends on each such Exchangeable Share held by
  such holder on any dividend record date which occurred prior to the closing
  of the purchase and sale. In connection with each exercise of the Exchange Right,
  Parent shall provide to the Trustee an Officer’s Certificate setting forth
  the calculation of the purchase price for each Exchangeable Share. The purchase
  price for each such Exchangeable Share so purchased may be satisfied only by
  Parent issuing and delivering or causing to be delivered to the Trustee, on
  behalf of the relevant Beneficiary, one Parent Common Share and on the applicable
  payment date a cheque for the balance, if any, of the purchase price without
  interest (but less any amounts withheld pursuant to Section 5.14) . 

	5.5 	Exercise Instructions 

     Subject to the terms and conditions
  herein set forth, a Beneficiary shall be entitled, upon the occurrence and during
  the continuance of an Insolvency Event, to instruct the Trustee to exercise
  the Exchange Right with respect to all or any part of the Exchangeable Shares
  registered in the name of such Beneficiary on the books of ExchangeCo. To cause
  the exercise of the Exchange Right by the Trustee, the Beneficiary shall deliver
  to the Trustee, in person or by certified or registered mail, at its principal
  corporate trust office in Vancouver, British Columbia or at such other places
  in Canada as the Trustee may from time to time designate by written notice to
  the Beneficiaries, the certificates representing the Exchangeable Shares which
  such Beneficiary desires Parent to purchase, duly endorsed in blank for transfer,
  and accompanied by such other documents and instruments as may be required to
  effect a transfer of Exchangeable Shares under the CBCA and the by-laws of ExchangeCo
  and such additional documents and instruments as the Trustee, Parent or ExchangeCo
  may reasonably require together with (a) a duly completed form of notice of
  exercise of the Exchange Right, contained on the reverse of or attached to the
  Exchangeable Share certificates, stating (i) that the Beneficiary thereby instructs
  the Trustee to exercise the Exchange Right so as to require Parent to purchase
  from the Beneficiary the number of Exchangeable Shares specified therein, (ii)
  that such Beneficiary has good title to and owns all such Exchangeable Shares
  to be acquired by Parent free and clear of all liens, claims, security interests,
  adverse claims and encumbrances, (iii) the names in which the certificates representing
  Parent Common Shares issuable in connection with the exercise of the Exchange
  Right are to be issued and (iv) the names and addresses of the Persons to whom
  such new certificates should be delivered and (b) payment (or evidence satisfactory
  to the Trustee, ExchangeCo and Parent of payment) of the taxes (if any) payable
  as contemplated by Section 5.8 of this Agreement. If only a part of the Exchangeable
  Shares represented by any certificate or certificates delivered to the Trustee
  are to be purchased by Parent under the Exchange Right, a new certificate for
  the balance of such Exchangeable Shares shall be issued to the holder at the
  expense of ExchangeCo. 

	5.6 	Delivery of Parent Common Shares; Effect of
      Exercise 

     Promptly after receipt of the certificates
  representing the Exchangeable Shares which the Beneficiary desires Parent to
  purchase under the Exchange Right, together with such documents and instruments
  of transfer and a duly completed form of notice of exercise of the Exchange
  Right (and payment of taxes, if any, payable as contemplated by Section 5.8
  or evidence thereof), duly endorsed for transfer to Parent, the Trustee shall
  notify Parent and ExchangeCo of its receipt of the same, which notice to Parent
  and ExchangeCo shall constitute exercise of the Exchange Right by the Trustee
  on behalf of the holder of such Exchangeable Shares, and Parent shall promptly
  thereafter deliver or cause to be delivered to the Trustee, for delivery to
  the Beneficiary of such Exchangeable Shares (or to such other Persons, if any,
  properly designated by such Beneficiary) the number of Parent Common Shares
  issuable in connection with the exercise of the Exchange Right, and on the applicable
  payment date cheques for the balance, if any, of the total purchase price therefor
  without interest (but less any amounts withheld pursuant to Section 5.14; provided,
  however, that no such delivery shall be made unless and until the 

- 11 - 

Beneficiary requesting the same shall have paid (or provided
  evidence satisfactory to the Trustee, ExchangeCo and Parent of the payment of)
  the taxes (if any) payable as contemplated by Section 5.8 of this Agreement.
  Immediately upon the giving of notice by the Trustee to Parent and ExchangeCo
  of the exercise of the Exchange Right as provided in this Section 5.6, the closing
  of the transaction of purchase and sale contemplated by the Exchange Right shall
  be deemed to have occurred and the holder of such Exchangeable Shares shall
  be deemed to have transferred to Parent all of such holder’s right, title
  and interest in and to such Exchangeable Shares shall cease to be a holder of
  such Exchangeable Shares and shall not be entitled to exercise any of the rights
  of a holder in respect thereof, other than the right to receive his proportionate
  part of the total purchase price for those Exchangeable Shares (together with
  a cheque for the balance, if any, of the total purchase price therefor without
  interest (but less any amounts withheld pursuant to Section 5.14), unless the
  requisite number of Parent Common Shares is not allotted, issued and delivered
  by Parent to the Trustee within five Business Days of the date of the giving
  of such notice by the Trustee and cheque for the balance, if any, of the total
  purchase price for such Exchangeable Shares is not issued and delivered to the
  Trustee on the applicable payment date, in which case the rights of the Beneficiary
  shall remain unaffected until such Parent Common Shares are so allotted, issued
  and delivered by Parent and any such cheque is issued and delivered by Parent.
  Upon delivery by Parent to the Trustee of such Parent Common Shares, the Trustee
  shall deliver such Parent Common Shares to such Beneficiary (or to such other
  Persons, if any, properly designated by such Beneficiary). Concurrently with
  such Beneficiary ceasing to be a holder of Exchangeable Shares, the Beneficiary
  shall be considered and deemed for all purposes to be the holder of the Parent
  Common Shares delivered to it pursuant to the Exchange Right. 

	5.7 	Exercise of Exchange Right Subsequent to Retraction
    

     In the event that a Beneficiary
  has exercised its right under Article 6 of the Exchangeable Share Provisions
  to require ExchangeCo to redeem any or all of the Exchangeable Shares held by
  the Beneficiary (the “Retracted Shares”) and is notified by
  ExchangeCo pursuant to Section 6.6 of the Exchangeable Share Provisions that
  ExchangeCo will not be permitted as a result of solvency requirements of applicable
  law to redeem all such Retracted Shares, and provided that ExchangeCo shall
  not have exercised the Retraction Call Right with respect to the Retracted Shares
  and that the Beneficiary has not revoked the retraction request delivered by
  the Beneficiary to ExchangeCo pursuant to Section 6.1 of the Exchangeable Share
  Provisions, the retraction request will constitute and will be deemed to constitute
  notice from the Beneficiary to the Trustee instructing the Trustee to exercise
  the Exchange Right with respect to those Retracted Shares that ExchangeCo is
  unable to redeem. In any such event, ExchangeCo hereby agrees with the Trustee
  and in favour of the Beneficiary to immediately notify the Trustee of the prohibition
  against ExchangeCo redeeming all of the Retracted Shares and to promptly to
  forward or cause to be forwarded to the Trustee all relevant materials delivered
  by the Beneficiary to ExchangeCo or to the transfer agent of the Exchangeable
  Shares (including without limitation, a copy of the retraction request delivered
  pursuant to Section 6.1 of the Exchangeable Share Provisions) in connection
  with such proposed redemption of the Retracted Shares and the Trustee will thereupon
  exercise the Exchange Right with respect to the Retracted Shares that ExchangeCo
  is not permitted to redeem and will require Parent to purchase such shares in
  accordance with the provisions of this Article 5. 

	5.8 	Stamp or Other Transfer Taxes 

     Upon any sale of Exchangeable Shares
  to Parent pursuant to the Exchange Right or the Automatic Exchange Rights, the
  share certificate or certificates representing Parent Common Shares to be delivered
  in connection with the payment of the total purchase price therefor shall be
  issued in the name of the Beneficiary of the Exchangeable Shares so sold or
  in such names as such Beneficiary may otherwise direct in writing without charge
  to the holder of the Exchangeable Shares so sold; provided, however, that such
  Beneficiary (a) shall pay (and none of Parent, ExchangeCo or the Trustee shall
  be 

- 12 - 

required to pay) any documentary, stamp, transfer or other taxes
  that may be payable in respect of any transfer involved in the issuance or delivery
  of such shares to a Person other than such Beneficiary or (b) shall have evidenced
  to the satisfaction of the Trustee, Parent and ExchangeCo that such taxes, if
  any, have been paid. 

	5.9 	Notice of Insolvency Event 

     As soon as practicable following
  the occurrence of an Insolvency Event or any event that with the giving of notice
  or the passage of time or both would be an Insolvency Event, ExchangeCo and
  Parent shall give written notice thereof to the Trustee. As soon as practicable
  following the receipt of notice from ExchangeCo and Parent of the occurrence
  of an Insolvency Event, or upon the Trustee becoming aware of an Insolvency
  Event, the Trustee will mail to each Beneficiary, at the expense of Parent,
  a notice of such Insolvency Event, in the form provided by the Parent, which
  notice shall contain a brief statement of the rights of the Beneficiaries with
  respect to the Exchange Right. 

	5.10 	Qualification of Parent Common Shares 

     Parent will in good faith expeditiously
  take all such reasonable actions and do all such reasonable things as are necessary
  or desirable to cause all Parent Common Shares to be delivered pursuant to the
  Exchange Right or the Automatic Exchange Rights to be listed, quoted or posted
  for trading on all stock exchanges and quotation systems on which outstanding
  Parent Common Shares have been listed by Parent and remain listed and are quoted
  or posted for trading at such time. 

	5.11 	Parent Common Shares 

     Parent hereby represents, warrants
  and covenants that the Parent Common Shares issuable as described herein will
  be duly authorized and validly issued as fully paid and non-assessable and shall
  be free and clear of any lien, claim or encumbrance. 

	5.12 	Prohibition on Voluntary Liquidation 

     Parent covenants that it shall
  not take any action relating to a voluntary liquidation, dissolution or winding-up
  of ExchangeCo or its successors, prior to the Redemption Date (as defined in
  the Exchangeable Share Provisions) unless prior to such liquidation, dissolution
  or winding-up Parent shall have taken such actions to ensure that it is possible
  for holders of Exchangeable Shares to extend through to the Redemption Date
  (subject to the continuing effect of other provisions of this Agreement which
  may permit the redemption or other termination of the Exchangeable Shares prior
  to the Redemption Date) the deferral of any gain incurred by such holders that
  would otherwise have been recognized at the Effective Time as a result of the
  consummation of the transactions contemplated by the Arrangement Agreement.

	5.13 	 Automatic Exchange on Liquidation of Parent

	 	 	 	 
		(a) 	 Parent will give the Trustee notice of each
        of the following events at the time set forth below:

	 	 	 	 
			(i) 	 in the event of any determination by the Board of Directors
        of Parent to institute voluntary liquidation, dissolution or winding-up
        proceedings with respect to Parent or to effect any other distribution
        of assets of Parent among its shareholders for the purpose of winding
        up its affairs, at least 60 days prior to the

- 13 - 

	 		  
	 proposed effective date of such liquidation, dissolution, winding-up
      or other distribution; and
	 	 	 	 
	 		(ii) 	 as soon as practicable following the earlier of (A)
        receipt by Parent of notice of, and (B) Parent otherwise becoming aware
        of, any threatened or instituted claim, suit, petition or other proceedings
        with respect to the involuntary liquidation, dissolution or winding-up
        of Parent or to effect any other distribution of assets of Parent among
        its shareholders for the purpose of winding up its affairs, in each case
        where Parent has failed to contest in good faith any such proceeding commenced
        in respect of Parent within 30 days of becoming aware thereof.

	 	 	 	 
	 	(b) 	 As soon as practicable following receipt by
        the Trustee from Parent of notice of any event (a “Liquidation
        Event”) contemplated by Section 5.13(a)(i) or 5.13(a)(ii) above,
        the Trustee will give notice thereof to the Beneficiaries. Such notice
        shall include a brief description of the automatic exchange of Exchangeable
        Shares for Parent Common Shares provided for in Section 5.13(c).

	 	 	 	 
	 	(c) 	 In order that the Beneficiaries will be able
        to participate on a pro rata basis with the holders of Parent Common Shares
        in the distribution of assets of Parent in connection with a Liquidation
        Event, on the fifth Business Day prior to the effective date (the “Liquidation
        Event Effective Date”) of a Liquidation Event all of the then
        outstanding Exchangeable Shares shall be automatically exchanged for Parent
        Common Shares. To effect such automatic exchange, Parent shall purchase
        on the fifth Business Day prior to the Liquidation Event Effective Date
        each Exchangeable Share then outstanding and held by Beneficiaries, and
        each Beneficiary shall sell the Exchangeable Shares held by it at such
        time, for a total purchase price per share equal to (a) the Current Market
        Price of a Parent Common Share on the fifth Business Day prior to the
        Liquidation Event Effective Date, which shall be satisfied in full by
        Parent issuing to the Beneficiary one Parent Common Share, and (b) to
        the extent not paid by ExchangeCo, an additional amount equivalent to
        the full amount of all declared and unpaid dividends on each such Exchangeable
        Share held by such holder on any dividend record date which occurred prior
        to the date of the exchange. In connection with such automatic exchange,
        Parent will provide to the Trustee an Officer’s Certificate setting
        forth the calculation of the purchase price for each Exchangeable Share.

	 	 	 	 
	 	(d) 	 On the fifth Business Day prior to the Liquidation
        Event Effective Date, the closing of the transaction of purchase and sale
        contemplated by the automatic exchange of Exchangeable Shares for Parent
        Common Shares shall be deemed to have occurred, and each Beneficiary shall
        be deemed to have transferred to Parent all of the Beneficiary’s
        right, title and interest in and to such Beneficiary’s Exchangeable
        Shares and the related interest in the Trust Estate and shall cease to
        be a holder of such Exchangeable Shares and Parent shall issue to the
        Beneficiary the Parent Common Shares issuable upon the automatic exchange
        of Exchangeable Shares for Parent Common Shares and on the applicable
        payment date shall deliver to the Trustee for delivery to the Beneficiary
        a cheque for the balance, if any, of the total purchase price for such
        Exchangeable Shares without interest but less any amounts withheld pursuant
        to Section 5.14. Concurrently with such Beneficiary ceasing to be a holder
        of Exchangeable Shares, the Beneficiary shall be considered and deemed
        for all purposes to be the holder of the Parent Common Shares issued pursuant
        to the automatic exchange of Exchangeable Shares for Parent Common Shares
        and the certificates held by the Beneficiary previously representing the
        Exchangeable Shares exchanged by the Beneficiary with Parent pursuant
        to such

- 14 - 

automatic exchange shall thereafter
  be deemed to represent Parent Common Shares issued to the Beneficiary by Parent
  pursuant to such automatic exchange. Upon the request of a Beneficiary and the
  surrender by the Beneficiary of Exchangeable Share certificates deemed to represent
  Parent Common Shares, duly endorsed in blank and accompanied by such instruments
  of transfer as Parent may reasonably require, Parent shall deliver or cause
  to be delivered to the Beneficiary certificates representing Parent Common Shares
  of which the Beneficiary is the holder. 

	5.14 	Withholding Rights 

     Parent, ExchangeCo and the Trustee
  shall be entitled to deduct and withhold from any consideration otherwise payable
  under this Agreement to any holder of Exchangeable Shares or Parent Common Shares
  such amounts as Parent, ExchangeCo or the Trustee is required or permitted to
  deduct and withhold with respect to such payment under the Income Tax Act (Canada),
  the United States Internal Revenue Code of 1986 or any provision of provincial,
  state, local or foreign tax law, in each case as amended or succeeded. To the
  extent that amounts are so withheld, such withheld amounts shall be treated
  for all purposes as having been paid to the holder of the shares in respect
  of which such deduction and withholding was made, provided that such withheld
  amounts are actually remitted to the appropriate taxing authority. To the extent
  that the amount so required or permitted to be deducted or withheld from any
  payment to a holder exceeds the cash portion of the consideration otherwise
  payable to the holder, Parent, ExchangeCo and the Trustee are hereby authorized
  to sell or otherwise dispose of such portion of the consideration as is necessary
  to provide sufficient funds to Parent, ExchangeCo or the Trustee, as the case
  may be, to enable it to comply with such deduction or withholding requirement
  and Parent, ExchangeCo or the Trustee shall notify the holder thereof and remit
  to such holder any unapplied balance of the net proceeds of such sale. Prior
  to making any distribution to holders of Exchangeable Shares or Parent Common
  Shares, Parent or ExchangeCo, as the case may be, shall ensure that the Trustee
  has access to sufficient funds (by directly providing, if necessary, such funds
  to the Trustee) to enable the Trustee to comply with any applicable withholding
  taxes in connection with such consideration. In carrying out its duties under
  this Section 5.14, the Trustee may obtain the advice of and assistance from
  such experts as the Trustee may reasonably consider necessary or advisable.
  If requested by the Trustee, Parent shall retain such experts for providing
  such advice or assistance to the Trustee. 

ARTICLE 6

  CONCERNING THE TRUSTEE 

	6.1 	Powers and Duties of the Trustee 

     The rights, powers, duties and
  authorities of the Trustee under this Agreement, in its capacity as Trustee
  of the Trust, shall include: 

	 	(a) 	 receipt and deposit of the Parent Special Voting Share
        from Parent as Trustee for and on behalf of the Beneficiaries in accordance
        with the provisions of this Agreement;

	 	 	 
	 	(b) 	 granting proxies and distributing materials to Beneficiaries
        as provided in this Agreement;

	 	 	 
	 	(c) 	 voting the Beneficiary Votes in accordance with the
        provisions of this Agreement;

	 	 	 
	 	(d) 	 receiving the grant of the Exchange Right and the Automatic
        Exchange Rights from Parent as Trustee for and on behalf of the Beneficiaries
        in accordance with the provisions of this Agreement;

- 15 - 

	 	(e) 	 exercising the Exchange Right and enforcing the benefit
        of the Automatic Exchange Rights, in each case in accordance with the
        provisions of this Agreement, and in connection therewith receiving from
        Beneficiaries Exchangeable Shares and other requisite documents and distributing
        to such Beneficiaries Parent Common Shares and cheques, if any, to which
        such Beneficiaries are entitled upon the exercise of the Exchange Right
        or pursuant to the Automatic Exchange Rights, as the case may be;

	 	 	 
	 	(f) 	 holding title to the Trust Estate;

	 	 	 
	 	(g) 	 investing any moneys forming, from time to time, a part
        of the Trust Estate as provided in this trust agreement;

	 	 	 
	 	(h) 	 taking action at the written direction of a Beneficiary
        or Beneficiaries to enforce the obligations of Parent and ExchangeCo under
        this Agreement; and

	 	 	 
	 	(i) 	 taking such other actions and doing such other things
        as are specifically provided in this Agreement.

     In the exercise of such rights,
  powers, duties and authorities the Trustee shall have (and is granted) such
  incidental and additional rights, powers, duties and authority not in conflict
  with any of the provisions of this Agreement as the Trustee, acting in good
  faith and in the reasonable exercise of its discretion, may deem necessary,
  appropriate or desirable to effect the purpose of the Trust. Any exercise of
  such discretionary rights, powers, duties and authorities by the Trustee shall
  be final, conclusive and binding upon all Persons. 

     The Trustee in exercising its rights,
  powers, duties and authorities hereunder shall act honestly and in good faith
  and with a view to the best interests of the Beneficiaries and shall exercise
  the care, diligence and skill that a reasonably prudent trustee would exercise
  in comparable circumstances. 

     The duties and obligations of the
  Trustee shall be determined by the provisions hereof and by the provisions of
  applicable law and accordingly, the Trustee shall only be responsible for the
  performance of such duties and obligations as it has undertaken herein or as
  required by applicable law. Where the provision of documentation to the Trustee
  is contemplated by this Agreement, the Trustee shall retain the right not to
  act and shall be held not to be liable for refusing to act unless it has received
  such documentation in a clear and reasonable form that complies with the terms
  of this Agreement. Such documentation must not require the exercise of any discretion
  or independent judgment on the part of the Trustee except as provided herein.

	6.2 	No Conflict of Interest 

     The Trustee represents to Parent
  and ExchangeCo that at the date of execution and delivery of this Agreement
  there exists no material conflict of interest in the role of the Trustee as
  a fiduciary hereunder and the role of the Trustee in any other capacity. The
  Trustee shall, within 90 days after it becomes aware that such material conflict
  of interest exists, either eliminate such material conflict of interest or resign
  in the manner and with the effect specified in Article 9. If, notwithstanding
  the foregoing provisions of this Section 6.2, the Trustee has such a material
  conflict of interest, the validity and enforceability of this Agreement shall
  not be affected in any manner whatsoever by reason only of the existence of
  such material conflict of interest. If the Trustee contravenes the foregoing
  provisions of this Section 6.2, any interested party may apply to the Supreme
  Court of British Columbia for an order that the Trustee be replaced as Trustee
  hereunder. 

- 16 - 

	6.3 	Dealings with Transfer Agents, Registrars, etc.
    

     Parent and ExchangeCo irrevocably authorize
  the Trustee, from time to time, to: 

	 	(a) 	 consult, communicate and otherwise deal with the respective
        registrars and transfer agents, and with any such subsequent registrar
        or transfer agent, of the Exchangeable Shares and Parent Common Shares;
        and

	 	 	 
	 	(b) 	 requisition, from time to time, (i) from any such registrar
        or transfer agent any information readily available from the records maintained
        by it which the Trustee may reasonably require for the discharge of its
        duties and responsibilities under this Agreement and (ii) from the transfer
        agent of Parent Common Shares, and any subsequent transfer agent of such
        shares, the share certificates issuable upon the exercise from time to
        time of the Exchange Right and pursuant to the Automatic Exchange Rights
        in the manner specified in Article 5 hereof.

     Parent and ExchangeCo irrevocably
  authorize their respective registrars and transfer agents to comply with all
  such requests. Parent covenants that it will supply its transfer agent with
  duly executed share certificates for the purpose of completing the exercise
  from time to time of the Exchange Right and the Automatic Exchange Rights in
  each case pursuant to Article 5 hereof. 

	6.4 	Books and Records 

     The Trustee shall keep available
  for inspection by Parent and ExchangeCo at the Trustee’s principal corporate
  trust office in Vancouver, British Columbia correct and complete books and records
  of account relating to the Trust created by this Agreement, including without
  limitation, all relevant data relating to mailings and instructions to and from
  Beneficiaries and all transactions pursuant to the Exchange Right and the Automatic
  Exchange Rights. On or before January 31, 2008, and on or before January 31
  in every year thereafter, so long as the Parent Special Voting Share is on deposit
  with the Trustee, the Trustee shall transmit to Parent and ExchangeCo a brief
  report, dated as of the preceding December 31, with respect to: 

	 	(a) 	 the property and funds comprising the Trust Estate as
        of that date;

	 	 	 
	 	(b) 	 the number of exercises of the Exchange Right, if any,
        and the aggregate number of Exchangeable Shares received by the Trustee
        on behalf of Beneficiaries in consideration of the issuance by Parent
        of Parent Common Shares in connection with the Exchange Right, during
        the calendar year ended on such December 31; and

	 	 	 
	 	(c) 	 any action taken by the Trustee in the performance of
        its duties under this Agreement which it had not previously reported.

	6.5 	Income Tax Returns and Reports 

     The Trustee shall, to the extent
  necessary, prepare and file on behalf of the Trust appropriate United States
  and Canadian income tax returns and any other returns or reports as may be required
  by applicable law or pursuant to the rules and regulations of any securities
  exchange or other trading system through which the Exchangeable Shares are traded
  and in connection therewith may obtain the advice of and assistance from such
  experts as the Trustee may reasonably consider necessary or advisable. If requested
  by the Trustee, Parent shall retain such experts for providing such advice or
  assistance to the Trustee. 

- 17 - 

	6.6 	Indemnification Prior to Certain Actions by
      Trustee 

     The Trustee shall exercise any
  or all of the rights, duties, powers or authorities vested in it by this Agreement
  at the request, order or direction of any Beneficiary upon such Beneficiary
  furnishing to the Trustee reasonable security, funding or indemnity, satisfactory
  to the Trustee, acting reasonably, against the costs, expenses and liabilities
  which may be incurred by the Trustee therein or thereby, provided that no Beneficiary
  shall be obligated to furnish to the Trustee any such security, funding or indemnity
  in connection with the exercise by the Trustee of any of its rights, duties,
  powers and authorities with respect to the Parent Special Voting Share pursuant
  to Article 4, subject to Section 6.15, and with respect to the Exchange Right
  pursuant to Article 5, subject to Section 6.15, and with respect to the Automatic
  Exchange Rights pursuant to Article 5, subject to Section 6.15. 

     None of the provisions contained
  in this Agreement shall require the Trustee to expend or risk its own funds
  or otherwise incur financial liability in the exercise of any of its rights,
  powers, duties, or authorities unless funded, given security or indemnified
  as aforesaid. 

	6.7 	Action of Beneficiaries 

     No Beneficiary shall have the right
  to institute any action, suit or proceeding or to exercise any other remedy
  authorized by this Agreement for the purpose of enforcing any of its rights
  or for the execution of any trust or power hereunder unless the Beneficiary
  has requested the Trustee to take or institute such action, suit or proceeding
  and furnished the Trustee with the security, funding or indemnity referred to
  in Section 6.6 and the Trustee shall have failed to act within a reasonable
  time thereafter. In such case, but not otherwise, the Beneficiary shall be entitled
  to take proceedings in any court of competent jurisdiction such as the Trustee
  might have taken; it being understood and intended that no one or more Beneficiaries
  shall have any right in any manner whatsoever to affect, disturb or prejudice
  the rights hereby created by any such action, or to enforce any right hereunder
  or the Voting Rights, the Exchange Rights or the Automatic Exchange Rights except
  subject to the conditions and in the manner herein provided, and that all powers
  and trusts hereunder shall be exercised and all proceedings at law shall be
  instituted, had and maintained by the Trustee, except only as herein provided,
  and in any event for the equal benefit of all Beneficiaries. 

	6.8 	Reliance Upon Declarations 

     The Trustee shall not be considered
  to be in contravention of any its rights, powers, duties and authorities hereunder
  if, when required, it acts and relies in good faith upon statutory declarations,
  certificates, opinions, lists, mailing labels, or reports or other papers or
  documents furnished pursuant to the provisions hereof or required by the Trustee
  to be furnished to it in the exercise of its rights, powers, duties and authorities
  hereunder if such statutory declarations, certificates, opinions, lists, mailing
  labels or reports or other papers or documents comply with the provisions of
  Section 6.9, if applicable, and with any other applicable provisions of this
  Agreement. 

	6.9 	Evidence and Authority to Trustee 

     Parent and/or ExchangeCo shall
  furnish to the Trustee evidence of compliance with the conditions provided for
  in this Agreement relating to any action or step required or permitted to be
  taken by Parent and/or ExchangeCo or the Trustee under this Agreement or as
  a result of any obligation imposed under this Agreement, including, without
  limitation, in respect of the Voting Rights or the Exchange Right or the Automatic
  Exchange Rights and the taking of any other action to be taken by the Trustee
  at the request of or on the application of Parent and/or ExchangeCo promptly
  if and when: 

- 18 - 

	 	(a) 	 such evidence is required by any other section of this
        Agreement to be furnished to the Trustee in accordance with the terms
        of this Section 6.9; or

	 	 	 
	 	(b) 	 the Trustee, in the exercise of its rights, powers,
        duties and authorities under this Agreement, gives Parent and/or ExchangeCo
        written notice requiring it to furnish such evidence in relation to any
        particular action or obligation specified in such notice.

     Such evidence shall consist of
  an Officer’s Certificate of Parent and/or ExchangeCo or a statutory declaration
  or a certificate made by Persons entitled to sign an Officer’s Certificate
  stating that any such condition has been complied with in accordance with the
  terms of this Agreement. 

     Whenever such evidence relates
  to a matter other than the Voting Rights or the Exchange Right or the Automatic
  Exchange Rights or the taking of any other action to be taken by the Trustee
  at the request or on the application of Parent and/or ExchangeCo, and except
  as otherwise specifically provided herein, such evidence may consist of a report
  or opinion of any solicitor, attorney, auditor, accountant, appraiser, valuer,
  engineer or other expert or any other Person whose qualifications give authority
  to a statement made by him, provided that if such report or opinion is furnished
  by a director, officer or employee of Parent and/or ExchangeCo it shall be in
  the form of an Officer’s Certificate or a statutory declaration. 

     Each statutory declaration, Officer’s
  Certificate, opinion or report furnished to the Trustee as evidence of compliance
  with a condition provided for in this Agreement shall include a statement by
  the Person giving the evidence: 

	 	(a) 	 declaring that he has read and understands the provisions
        of this Agreement relating to the condition in question;

	 	 	 
	 	(b) 	 describing the nature and scope of the examination or
        investigation upon which he based the statutory declaration, certificate,
        statement or opinion; and

	 	 	 
	 	(c) 	 declaring that he has made such examination or investigation
        as he believes is necessary to enable him to make the statements or give
        the opinions contained or expressed therein.

	6.10 	Experts, Advisers and Agents 

     The Trustee may: 

	 	(a) 	 in relation to these presents act and rely on the opinion
        or advice of or information obtained from any solicitor, attorney, auditor,
        accountant, appraiser, valuer, engineer or other expert, whether retained
        by the Trustee or by Parent and/or ExchangeCo or otherwise, and may employ
        such assistants as may be necessary to the proper discharge of its powers
        and duties and determination of its rights hereunder and may pay proper
        and reasonable compensation for all such legal and other advice or assistance
        as aforesaid; and

	 	 	 
	 	(b) 	 employ such agents and other assistants as it may reasonably
        require for the proper determination and discharge of its powers and duties
        hereunder, and may pay reasonable remuneration for all services performed
        for it (and shall be entitled to receive reasonable remuneration for all
        services performed by it) in the discharge of the trusts hereof and compensation
        for all disbursements, costs and expenses made or incurred by it in the
        discharge of its duties hereunder and in the management of the Trust.

- 19 - 

	6.11 	Investment of Moneys Held by Trustee 

     Unless otherwise provided in this
  trust agreement, any moneys held by or on behalf of the Trustee which under
  the terms of this trust agreement may or ought to be invested or which may be
  on deposit with the Trustee or which may be in the hands of the Trustee may
  be invested and reinvested in the name or under the control of the Trustee in
  securities in which, under the laws of the Province of Ontario, trustees are
  authorized to invest trust moneys, provided that such securities are stated
  to mature within two years after their purchase by the Trustee, and the Trustee
  shall so invest such moneys on the written direction of ExchangeCo. Pending
  the investment of any moneys as hereinbefore provided, such moneys may be deposited
  in the name of the Trustee in any chartered bank in Canada or, with the consent
  of ExchangeCo, in the deposit department of the Trustee or any other loan or
  trust company authorized to accept deposits under the laws of Canada or any
  province thereof at the rate of interest then current on similar deposits. 

	6.12 	Trustee Not Required to Give Security 

     The Trustee shall not be required
  to give any bond or security in respect of the execution of the trusts, rights,
  duties, powers and authorities of this Agreement or otherwise in respect of
  the premises. 

	6.13 	Trustee Not Bound to Act on Request 

     Except as in this Agreement otherwise
  specifically provided, the Trustee shall not be bound to act in accordance with
  any direction or request of Parent and/or ExchangeCo or of the directors thereof
  until a duly authenticated copy of the instrument or resolution containing such
  direction or request shall have been delivered to the Trustee, and the Trustee
  shall be empowered to act upon any such copy purporting to be authenticated
  and believed by the Trustee to be genuine. 

	6.14 	Authority to Carry on Business 

     The Trustee represents to Parent
  and ExchangeCo that at the date of execution and delivery by it of this Agreement
  it is authorized to carry on the business of a trust company in each of the
  Provinces of Canada but if, notwithstanding the provisions of this Section 6.14,
  it ceases to be so authorized to carry on business, the validity and enforceability
  of this Agreement and the Voting Rights, the Exchange Right and the Automatic
  Exchange Rights shall not be affected in any manner whatsoever by reason only
  of such event but the Trustee shall, within 90 days after ceasing to be authorized
  to carry on the business of a trust company in any Province of Canada, either
  become so authorized or resign in the manner and with the effect specified in
  Article 9. 

	6.15 	Conflicting Claims 

     If conflicting claims or demands
  are made or asserted with respect to any interest of any Beneficiary in any
  Exchangeable Shares, including any disagreement between the heirs, representatives,
  successors or assigns succeeding to all or any part of the interest of any Beneficiary
  in any Exchangeable Shares, resulting in conflicting claims or demands being
  made in connection with such interest, then the Trustee shall be entitled, at
  its sole discretion, to refuse to recognize or to comply with any such claims
  or demands. In so refusing, the Trustee may elect not to exercise any Voting
  Rights, Exchange Rights or Automatic Exchange Rights subject to such conflicting
  claims or demands and, in so doing, the Trustee shall not be or become liable
  to any Person on account of such election or its failure or refusal to comply
  with any such conflicting claims or demands. The Trustee shall be entitled to
  continue to refrain from acting and to refuse to act until: 

- 20 - 

	 	(a) 	 the rights of all adverse claimants with respect to
        the Voting Rights, Exchange Right or Automatic Exchange Rights subject
        to such conflicting claims or demands have been adjudicated by a final
        judgment of a court of competent jurisdiction and all rights of appeal
        have expired; or

	 	 	 
	 	(b) 	 all differences with respect to the Voting Rights, Exchange
        Right or Automatic Exchange Rights subject to such conflicting claims
        or demands have been conclusively settled by a valid written agreement
        binding on all such adverse claimants, and the Trustee shall have been
        furnished with an executed copy of such agreement certified to be in full
        force and effect.

     If the Trustee elects to recognize
  any claim or comply with any demand made by any such adverse claimant, it may
  in its discretion require such claimant to furnish such surety bond or other
  security satisfactory to the Trustee as it shall deem appropriate to fully indemnify
  it as between all conflicting claims or demands. 

	6.16 	Acceptance of Trust 

     The Trustee hereby accepts the
  Trust created and provided for by and in this Agreement and agrees to perform
  the same upon the terms and conditions herein set forth and to hold all rights,
  privileges and benefits conferred hereby and by law in trust for the various
  Persons who shall from time to time be Beneficiaries, subject to all the terms
  and conditions herein set forth. 

	6.17 	Incumbency Certificate 

     Each of Parent and ExchangeCo shall
  file with the Trustee a certificate of incumbency setting forth the names of
  the individuals authorized to give instructions, directions or other instruments
  to the Trustee (each an “Authorized Person”), together with
  specimen signatures of such persons, and the Trustee shall be entitled to rely
  on the latest certificate of incumbency filed with it unless it receives notice,
  in accordance with Section 13.3 of this Agreement, of a change in the Authorized
  Persons with updated specimen signatures. 

ARTICLE 7 

  COMPENSATION 

	7.1 	Fees and Expenses of the Trustee 

     Parent and ExchangeCo jointly and
  severally agree to pay the Trustee reasonable compensation for all of the services
  rendered by it under this Agreement and will reimburse the Trustee for all reasonable
  expenses (including taxes other than taxes based on the net income of the Trustee)
  and disbursements (including reasonable travel expenses incurred by the Trustee
  in connection with its duties hereunder and reasonable compensation and reasonable
  remuneration paid by the Trustee in connection with the retainer or employment
  of experts, advisors and agents under Sections 5.14, 6.5 and 6.10), including
  the cost and expense of any suit or litigation of any character and any proceedings
  before any governmental agency reasonably incurred by the Trustee in connection
  with its duties under this Agreement; provided that Parent and ExchangeCo shall
  have no obligation to reimburse the Trustee for any expenses or disbursements
  paid, incurred or suffered by the Trustee in any suit or litigation in which
  the Trustee is determined to have acted in bad faith or with negligence, recklessness
  or wilful misconduct. Invoices for services rendered by the Trustee hereunder
  shall be provided to Parent, on behalf of Parent and ExchangeCo, at the address
  of the Parent set forth in Section 13.3 of this Agreement. Any amount owing
  or unpaid after 30 days from the invoice date will bear interest at a rate per
  annum, from the 

- 21 - 

expiration of such 30 day period, equal to the then current rate
  charged by the Trustee and shall be payable on demand. The obligation of Parent
  and ExchangeCo under this Section 7.1 shall survive the resignation or removal
  of the Trustee. 

ARTICLE 8 

  INDEMNIFICATION AND LIMITATION OF LIABILITY 

	8.1 	Indemnification of the Trustee 

     Parent and ExchangeCo jointly and
  severally agree to indemnify and hold harmless the Trustee and each of its directors,
  officers and agents appointed and acting in accordance with this Agreement (collectively,
  the “Indemnified Parties”) against all claims, losses, damages,
  reasonable costs, penalties, fines and reasonable expenses (including reasonable
  expenses of the Trustee’s legal counsel) which, without fraud, negligence,
  recklessness, wilful misconduct or bad faith on the part of such Indemnified
  Party, may be paid, incurred or suffered by the Indemnified Party by reason
  or as a result of the Trustee’s acceptance or administration of the Trust,
  its compliance with its duties set forth in this Agreement, or any written or
  oral instruction delivered to the Trustee by Parent or ExchangeCo pursuant hereto.

     In no case shall Parent or ExchangeCo
  be liable under this indemnity for any claim against any of the Indemnified
  Parties unless Parent and ExchangeCo shall be notified by the Trustee of the
  written assertion of a claim or of any action commenced against the Indemnified
  Parties, promptly after any of the Indemnified Parties shall have received any
  such written assertion of a claim or shall have been served with a summons or
  other first legal process giving information as to the nature and basis of the
  claim. Subject to (ii) below, Parent and ExchangeCo shall be entitled to participate
  at their own expense in the defence and, if Parent and ExchangeCo so elect at
  any time after receipt of such notice, either of them may assume the defence
  of any suit brought to enforce any such claim. The Trustee shall have the right
  to employ separate counsel in any such suit and participate, in the defence
  thereof but the fees and expenses of such counsel shall be at the expense of
  the Trustee unless: (i) the employment of such counsel has been authorized by
  Parent or ExchangeCo; or (ii) the named parties to any such suit include both
  the Trustee and Parent or ExchangeCo and the Trustee shall have been advised
  by counsel acceptable to Parent or ExchangeCo that there may be one or more
  legal defences available to the Trustee that are different from or in addition
  to those available to Parent or ExchangeCo and that, in the judgment of such
  counsel, would present a conflict of interest were a joint representation to
  be undertaken (in which case Parent and ExchangeCo shall not have the right
  to assume the defence of such suit on behalf of the Trustee but shall be liable
  to pay the reasonable fees and expenses of counsel for the Trustee). 

     For certainty, the indemnity provided
  for in this Section 8.1 shall survive the termination of the Agreement. 

	8.2 	Limitation on Liability 

     The Trustee shall not be held liable
  for any loss which may occur by reason of depreciation of the value of any part
  of the Trust Estate or any loss incurred on any investment of funds pursuant
  to this trust agreement, except to the extent that such loss is attributable
  to the fraud, negligence, recklessness, wilful misconduct or bad faith on the
  part of the Trustee. 

- 22 - 

ARTICLE 9 

  CHANGE OF TRUSTEE 

	9.1 	Resignation 

     The Trustee, or any trustee hereafter
  appointed, may at any time resign by giving written notice of such resignation
  to Parent and ExchangeCo specifying the date on which it desires to resign,
  provided that such notice shall not be given less than one month before such
  desired resignation date unless Parent and ExchangeCo otherwise agree and provided
  further that such resignation shall not take effect until the date of the appointment
  of a successor trustee and the acceptance of such appointment by the successor
  trustee. Upon receiving such notice of resignation, Parent and ExchangeCo shall
  promptly appoint a successor trustee by written instrument in duplicate, one
  copy of which shall be delivered to the resigning trustee and one copy to the
  successor trustee. Failing acceptance by a successor trustee of such appointment,
  a successor trustee may be appointed by an order of a court of competent jurisdiction
  upon application of one or more of the parties hereto, at the expense of Parent
  and ExchangeCo. 

	9.2 	Removal 

     The Trustee, or any trustee hereafter
  appointed, may (provided a successor trustee is appointed) be removed at any
  time on not less than 30 days’ prior notice by written instrument executed
  by Parent and ExchangeCo, in duplicate, one copy of which shall be delivered
  to the trustee so removed and one copy to the successor trustee. 

	9.3 	Successor Trustee 

     Any successor trustee appointed
  as provided under this Agreement shall execute, acknowledge and deliver to Parent
  and ExchangeCo and to its predecessor trustee an instrument accepting such appointment.
  Thereupon the resignation or removal of the predecessor trustee shall become
  effective and such successor trustee, without any further act, deed or conveyance,
  shall become vested with all the rights, powers, duties and obligations of its
  predecessor under this Agreement, with the like effect as if originally named
  as trustee in this Agreement. However, on the written request of Parent and
  ExchangeCo or of the successor trustee, the trustee ceasing to act shall, upon
  payment of any amounts then due it pursuant to the provisions of this Agreement,
  execute and deliver an instrument transferring to such successor trustee all
  the rights and powers of the trustee so ceasing to act. Upon the request of
  any such successor trustee, Parent, ExchangeCo and such predecessor trustee
  shall execute any and all instruments in writing for more fully and certainly
  vesting in and confirming to such successor trustee all such rights and powers.

	9.4 	Notice of Successor Trustee 

     Upon acceptance of appointment
  by a successor trustee as provided herein, Parent and ExchangeCo shall cause
  to be mailed notice of the succession of such trustee hereunder to each Beneficiary
  specified in a List. If Parent or ExchangeCo shall fail to cause such notice
  to be mailed within 10 days after acceptance of appointment by the successor
  trustee, the successor trustee shall cause such notice to be mailed at the expense
  of Parent and ExchangeCo. 

- 23 - 

ARTICLE 10 

  PARENT SUCCESSORS 

	10.1 	Certain Requirements in Respect of Combination,
      etc. 

     Parent shall not consummate any
  transaction (whether by way of reconstruction, reorganization, consolidation,
  merger, transfer, sale, lease or otherwise) whereby all or substantially all
  of its undertaking, property and assets would become the property of any other
  Person or, in the case of a merger, of the continuing corporation resulting
  therefrom unless, but may do so if such other Person or continuing corporation
  (herein called the “Parent Successor”), by operation of law,
  becomes, without more, bound by the terms and provisions of this Agreement or,
  if not so bound, executes, prior to or contemporaneously with the consummation
  of such transaction, a trust agreement supplemental hereto to evidence the assumption
  by the Parent Successor of liability for all moneys payable and property deliverable
  hereunder and the covenant of such Parent Successor to pay and deliver or cause
  to be delivered the same and its agreement to observe and perform all the covenants
  and obligations of Parent under this Agreement. 

	10.2 	Vesting of Powers in Successor 

     Whenever the conditions of Section
  10.1 have been duly observed and performed, the Trustee and, if required by
  Section 10.1, Parent Successor and ExchangeCo shall execute and deliver the
  supplemental trust agreement provided for in Article 11 and thereupon Parent
  Successor shall possess and from time to time may exercise each and every right
  and power of Parent under this Agreement in the name of Parent or otherwise
  and any act or proceeding by any provision of this Agreement required to be
  done or performed by the Board of Directors of Parent or any officers of Parent
  may be done and performed with like force and effect by the directors or officers
  of such Parent Successor. 

	10.3 	Wholly-Owned Subsidiaries 

     Nothing herein shall be construed
  as preventing the amalgamation or merger of any wholly-owned direct or indirect
  subsidiary of Parent with or into Parent or the winding-up, liquidation or dissolution
  of any wholly-owned subsidiary of Parent provided that all of the assets of
  such subsidiary are transferred to Parent or another wholly-owned direct or
  indirect subsidiary of Parent and any such transactions are expressly permitted
  by this Article 10. 

ARTICLE 11 

  AMENDMENTS AND SUPPLEMENTAL TRUST AGREEMENTS 

	11.1 	Amendments, Modifications, etc. 

     This Agreement may not be amended
  or modified except by an agreement in writing executed by Parent, ExchangeCo
  and the Trustee and approved by the Beneficiaries in accordance with Section
  10.2 of the Exchangeable Share Provisions. 

	11.2 	Ministerial Amendments 

     Notwithstanding the provisions
  of Section 11.1, the parties to this Agreement may in writing, at any time and
  from time to time, without the approval of the Beneficiaries, amend or modify
  this Agreement for the purposes of: 

- 24 - 

	 	(a) 	 adding to the covenants of any or all parties hereto
        for the protection of the Beneficiaries hereunder provided that the Board
        of Directors of each of ExchangeCo and Parent shall be of the good faith
        opinion that such additions will not be prejudicial to the rights or interests
        of the Beneficiaries;

	 	 	 
	 	(b) 	 making such amendments or modifications not inconsistent
        with this Agreement as may be necessary or desirable with respect to matters
        or questions which, in the good faith opinion of the Board of Directors
        of each of Parent and ExchangeCo and in the opinion of the Trustee (which
        may, for this purpose, rely on the opinion of counsel), having in mind
        the best interests of the Beneficiaries, it may be expedient to make,
        provided that such Boards of Directors and the Trustee shall be of the
        opinion that such amendments and modifications will not be prejudicial
        to the interests of the Beneficiaries; or

	 	 	 
	 	(c) 	 making such changes or corrections which, on the advice
        of counsel to Parent, ExchangeCo and the Trustee, are required for the
        purpose of curing or correcting any ambiguity or defect or inconsistent
        provision or clerical omission or mistake or manifest error, provided
        that in the opinion of the Trustee (which may, for this purpose, rely
        on the opinion of counsel) and the Board of Directors of each of Parent
        and ExchangeCo such changes or corrections will not be prejudicial to
        the rights and interests of the Beneficiaries.

	11.3 	Meeting to Consider Amendments 

     ExchangeCo, at the request of Parent,
  shall call a meeting or meetings of the Beneficiaries for the purpose of considering
  any proposed amendment or modification requiring approval pursuant hereto. Any
  such meeting or meetings shall be called and held in accordance with the by-laws
  of ExchangeCo, the Exchangeable Share Provisions and all applicable laws. 

	11.4 	Changes in Capital of Parent and ExchangeCo
    

     At all times after the occurrence
  of any event contemplated pursuant to Section 2.7 or 2.8 of the Exchangeable
  Share Support Agreement or otherwise, as a result of which either Parent Common
  Shares or the Exchangeable Shares or both are in any way changed, this Agreement
  shall forthwith be amended and modified as necessary in order that it shall
  apply with full force and effect, mutatis mutandis, to all new securities into
  which Parent Common Shares or the Exchangeable Shares or both are so changed
  and the parties hereto shall execute and deliver a supplemental trust agreement
  giving effect to and evidencing such necessary amendments and modifications.

	11.5 	Execution of Supplemental Trust Agreements
    

     No amendment to or modification
  or waiver of any of the provisions of this Agreement otherwise permitted hereunder
  shall be effective unless made in writing and signed by all of the parties hereto.
  From time to time ExchangeCo (when authorized by a resolution of its Board of
  Directors), Parent (when authorized by a resolution of its Board of Directors)
  and the Trustee may, subject to the provisions of these presents, and they shall,
  when so directed by these presents, execute and deliver by their proper officers,
  trust agreements or other instruments supplemental hereto, which thereafter
  shall form part hereof, for any one or more of the following purposes: 

	 	(a) 	 evidencing the succession of Parent Successors and the
        covenants of and obligations assumed by each such Parent Successor in
        accordance with the provisions of Article 10 and any successor trustee
        in accordance with the provisions of Article 9 and Section 12.3;

- 25 - 

	 	(b) 	 making any additions to, deletions from or alterations
        of the provisions of this Agreement or the Voting Rights, the Exchange
        Right or the Automatic Exchange Rights which, in the opinion of the Trustee
        (which may, for this purpose, rely on the opinion of counsel), will not
        be prejudicial to the interests of the Beneficiaries or are, in the opinion
        of counsel to the Trustee, necessary or advisable in order to incorporate,
        reflect or comply with any legislation the provisions of which apply to
        Parent, ExchangeCo, the Trustee or this Agreement; and

	 	 	 
	 	(c) 	 for any other purposes not inconsistent with the provisions
        of this Agreement, including without limitation, to make or evidence any
        amendment or modification to this Agreement as contemplated hereby, provided
        that, in the opinion of the Trustee (which may, for this purpose, rely
        on the opinion of counsel), the rights of the Trustee and Beneficiaries
        will not be prejudiced thereby.

ARTICLE 12 

  TERMINATION AND ASSIGNMENT 

	12.1 	Term 

     The Trust created by this Agreement
  shall continue until the earliest to occur of the following events: 

	 	(a) 	 no outstanding Exchangeable Shares are held by a Beneficiary
        (other than Parent and its Affiliates);

	 	 	 
	 	(b) 	 each of Parent and ExchangeCo elects in writing to terminate
        the Trust and such termination is approved by the Beneficiaries in accordance
        with Section 10.2 of the Exchangeable Share Provisions; and

	 	 	 
	 	(c) 	 21 years from the date of this Agreement.

	12.2 	Survival of Agreement 

     This Agreement shall survive any
  termination of the Trust and shall continue until there are no Exchangeable
  Shares outstanding held by a Beneficiary; provided, however, that the provisions
  of Article 7 and Article 8 shall survive any such termination of this Agreement.

	12.3 	Assignment by Trustee 

     This Agreement may not be assigned
  by the Trustee without the prior written consent of Parent and ExchangeCo, not
  to be unreasonably withheld; provided, however, that this Agreement may be assigned
  by the Trustee to an Affiliate (the “Assignee”) if (a) the
  Assignee executes, acknowledges and delivers to Parent and ExchangeCo a trust
  agreement of other instrument(s) supplemental hereto as provided in Article
  11 to evidence the appointment of it as successor trustee and the acceptance
  by it of such appointment and the assumption by it of all the duties and obligations
  of the predecessor trustee hereunder without further amendment hereto, and (b)
  Parent and ExchangeCo are provided with a certificate of a senior officer of
  the Assignee in form satisfactory to them, acting reasonably, certifying that
  the Assignee is authorized to carry on the business of a trust company in each
  of the Provinces of Canada and is free of any material conflict of interest
  in its role as fiduciary under this Agreement and in its role in any other capacity.

- 26 - 

ARTICLE 13 

  GENERAL 

	13.1 	Severability 

     If any provision of this Agreement
  is held to be invalid, illegal or unenforceable, the validity, legality or enforceability
  of the remainder of this Agreement shall not in any way be affected or impaired
  thereby and the Agreement shall be carried out as nearly as possible in accordance
  with its original terms and conditions. 

	13.2 	Enurement 

     This Agreement shall be binding
  upon and enure to the benefit of the parties hereto and their respective successors
  and permitted assigns and to the benefit of the Beneficiaries. 

	13.3 	Notices to Parties 

     All notices and other communications
  required or permitted to be delivered to a party under this Agreement shall
  be in writing and shall be deemed to have been properly delivered, given or
  received upon receipt when delivered by hand or two business days after being
  sent by registered mail or by courier or by express delivery service or by facsimile,
  provided that in each case the notice or communication is sent to the address
  or a facsimile telephone number set forth beneath the name of such party below:

	 	(a) 	if to ExchangeCo or Parent to: 
	 	  	  	  
	 	  	             
           CounterPath Solutions, Inc. 
	 	  	             
           Suite 300, One Bentall Centre 
	 	 	                 
       505 Burrard Street  	 
	 	  	             
           Vancouver, BC V7X 1M3 
	 	  	  	  
	 	  	                 
       Attention: 	Vice-President 
	 	  	                 
       Fax: 	(604) 320-3399 
	 	  	  	  
	 	(b) 	with copy (but not as notice) to: 
	 	  	  	  
	 	 	                 
       Clark Wilson LLP  	 
	 	  	             
           800 – 885 W. Georgia Street 
	 	  	             
           Vancouver, BC V6C 3H1 
	 	  	  	  
	 	  	                 
       Attention: 	Virgil Hlus 
	 	  	                 
       Fax: 	(604) 687-6314 
	 	  	  	  
	 	(c) 	if to the Trustee to: 	  
	 	  	  	  
	 	  	             
           Valiant Trust Company 
	 	  	             
           600 – 750 Cambie Street 
	 	  	             
           Vancouver, BC V6B 0A2 
	 	  	  	  
	 	  	                 
       Attention: 	Janet Brown 
	 	  	                 
       Fax: 	(604) 681-3067 

- 27 - 

Any notice or other communication given personally shall be deemed
  to have been given and received upon delivery thereof and if given by fax shall
  be deemed to have been given and received on the date of receipt thereof unless
  such day is not a Business Day in which case it shall be deemed to have been
  given and received upon the immediately following Business Day. 

	13.4 	Notice to Beneficiaries 

     Any and all notices to be given
  and any documents to be sent to any Beneficiaries may be given or sent to the
  address of such Beneficiary shown on the register of holders of Exchangeable
  Shares in any manner permitted by the by-laws of ExchangeCo from time to time
  in force in respect of notices to shareholders and shall be deemed to be received
  (if given or sent in such manner) at the time specified in such by-laws, the
  provisions of which by-laws shall apply mutatis mutandis to notices or documents
  as aforesaid sent to such Beneficiaries. 

	13.5 	Risk of Payments by Post 

     Whenever payments are to be made
  or documents are to be sent to any Beneficiary by the Trustee or Beneficiary
  to the Trustee, the making of such payment or sending of such document sent
  through the post shall be at risk of the Parent and ExchangeCo, in the case
  of payments made or documents sent by the Trustee, and at the risk of the Beneficiary,
  in the case of payments made or documents sent by the Beneficiary. 

	13.6 	Counterparts 

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

	13.7 	Fax execution 

     This Agreement may be executed
  by delivery of executed signature pages by fax and such fax execution will be
  effective for all purposes. 

	13.8 	Jurisdiction 

     This Agreement shall be construed
  and enforced in accordance with the laws of the Province of British Columbia
  and the laws of Canada applicable therein. 

	13.9 	Attornment 

     Parent agrees that any action or
  proceeding arising out of or relating to this Agreement may be instituted in
  the courts of British Columbia, waives any objection which it may have now or
  hereafter to the venue of any such action or proceeding, irrevocably submits
  to the jurisdiction of the said courts in any such action or proceeding, and
  hereby appoints ExchangeCo at its registered office in the Province of British
  Columbia as Parent’s attorney for service of process. 

- 28 - 

     IN WITNESS WHEREOF the parties
  hereto have caused this Agreement to be duly executed as of the date first above
  written. 

6789722 CANADA INC. 

	Per: 	 	 
	Name: 	 	 
	Title: 	 	 
	  	 	 
	  	 	 
	COUNTERPATH SOLUTIONS, INC. 	 
	  	 	 
	  	 	 
	Per: 	 	 
	Name: 	 	 
	Title: 	 	 
	  	 	 
	  	 	 
	VALIANT TRUST COMPANY 	 
	  	 	 
	  	 	 
	Per: 	 	 
	Name: 	 	 
	Title: 	 	 

- 29 - 

 

	
SCHEDULE G
	
	 

	
	
TO THE ARRANGEMENT AGREEMENT AMONG
	
	
COUNTERPATH SOLUTIONS, INC, 6789722 CANADA INC. AND
	
	
NEWHEIGHTS SOFTWARE CORPORATION
	
	 

	
	
EXCHANGEABLE SHARE SUPPORT AGREEMENT
	

FORM OF EXCHANGEABLE SHARE SUPPORT AGREEMENT 

THIS AGREEMENT made as of the 15th day of June, 2007. 

	AMONG: 
	                 
                           COUNTERPATH
      SYSTEMS, INC., a Nevada corporation, (“Parent”) 
	AND 
	                 
                           6789722
      CANADA INC., a corporation existing under the laws of 
	                 
                           Canada,
      (“ExchangeCo”) 

WHEREAS: 

A. Pursuant to an arrangement agreement (the “Arrangement
  Agreement”) dated as of June 15, 2007 by and among Parent, ExchangeCo
  and NewHeights Software Corporation (the “Company”), ExchangeCo
  has agreed to issue exchangeable shares (the “Exchangeable Shares”)
  to certain holders of common shares of the Company pursuant to the plan of arrangement
  (the “Arrangement”) contemplated by the Arrangement Agreement;
  and 

B. Pursuant to the Arrangement Agreement, Parent and ExchangeCo
  have agreed to execute an exchangeable share support agreement substantially
  in the form of this Agreement. 

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

ARTICLE 1 

  DEFINITIONS AND INTERPRETATION 

	1.1 	Defined Terms 

     Each term denoted herein by initial
  capital letters and not otherwise defined herein shall have the meaning ascribed
  thereto in the rights, privileges, restrictions and conditions (collectively,
  the “Share Provisions”) attaching to the Exchangeable Shares
  attached as Appendix 1 to the Plan of Arrangement as set out in Schedule D to
  the Arrangement Agreement, unless the context requires otherwise. 

	1.2 	Interpretation Not Affected by Headings
    

     The division of this Agreement
  into Articles, Sections and other portions and the insertion of headings are
  for convenience of reference only and shall not affect the construction or interpretation
  of this Agreement. Unless otherwise indicated, all references to an “Article”
  or “Section” followed by a number and/or a letter refer to the specified
  Article or Section of this Agreement. The terms “this Agreement”,
  “hereof”, “herein” and “hereunder” and similar
  expressions refer to this Agreement and not to any particular Article, Section
  or other portion hereof and include any agreement or instrument supplementary
  or ancillary hereto. 

	1.3 	Number, Gender 

     Words importing the singular number
  only shall include the plural and vice versa. Words importing any gender shall
  include all genders. 

	1.4 	Date for any Action 

     If any date on which any action
  is required to be taken under this Agreement is not a Business Day, such action
  shall be required to be taken on the next succeeding Business Day. For the purposes
  of this agreement, a “Business Day” means any day on which commercial
  banks are generally open for business in Vancouver, British Columbia, other
  than a Saturday, a Sunday or a day observed as a holiday in Vancouver, British
  Columbia under the laws of the Province of British Columbia or the federal laws
  of Canada. 

ARTICLE 2 

  COVENANTS OF PARENT AND EXCHANGECO 

	2.1 	Covenants Regarding Exchangeable Shares
    

     So long as any Exchangeable Shares
  not owned by Parent or its Affiliates are outstanding, Parent will: 

	 	(a) 	 not declare or pay any dividends on the Parent Common
        Shares unless (i) ExchangeCo shall (w) simultaneously declare or pay,
        as the case may be, an equivalent dividend (as provided for in the Share
        Provisions and as determined by the Board of Directors of ExchangeCo as
        contemplated by Section 2.7(d) hereof) on the Exchangeable Shares (an
        “Equivalent Dividend”) and (x) have sufficient money
        or other assets or authorized but unissued securities available to enable
        the due declaration and the due and punctual payment, in accordance with
        applicable law, of any Equivalent Dividend, or (ii) ExchangeCo shall (y)
        subdivide the Exchangeable Shares in lieu of a stock dividend thereon
        (as provided for in the Share Provisions) (an “Equivalent Stock
        Subdivision”), and (z) have sufficient authorized but unissued
        securities available to enable the Equivalent Stock Subdivision;

	 	 	 
	 	(b) 	 advise ExchangeCo sufficiently in advance of the declaration
        by Parent of any dividend on Parent Common Shares and take all such other
        actions as are reasonably necessary, in cooperation with ExchangeCo, to
        ensure that the respective declaration date, record date and payment date
        for a dividend on the Exchangeable Shares shall be the same as the declaration
        date, record date and payment date for the corresponding dividend on the
        Parent Common Shares;

	 	 	 
	 	(c) 	 ensure that the record date for any dividend declared
        on Parent Common Shares is not less than 10 Business Days after the declaration
        date of such dividend;

	 	 	 
	 	(d) 	 take all such actions and do all such things as are
        reasonably necessary or desirable to enable and permit ExchangeCo, in
        accordance with applicable law, to pay and otherwise perform its obligations
        with respect to the satisfaction of the Liquidation Amount, the Retraction
        Price or the Redemption Price in respect of each issued and outstanding
        Exchangeable Share upon the liquidation, dissolution or winding-up of
        ExchangeCo, the delivery of a Retraction Request by a holder of Exchangeable
        Shares or a redemption of Exchangeable Shares by ExchangeCo, as the case
        may be, including without limitation

- 2 - 

	 		 all such actions and all such things as are necessary
        or desirable to enable and permit ExchangeCo to cause to be delivered
        Parent Common Shares to the holders of Exchangeable Shares in accordance
        with the provisions of Article 5, 6 or 7, as the case may be, of the Share
        Provisions; and

	 	 	 
	 	(e) 	 take all such actions and do all such things as are
        reasonably necessary or desirable to enable and permit ExchangeCo, in
        accordance with applicable law, to perform its obligations arising upon
        the exercise by ExchangeCo of the Liquidation Call Right, the Retraction
        Call Right or the Redemption Call Right, including without limitation
        all such actions and all such things as are necessary or desirable to
        enable and permit ExchangeCo to cause to be delivered Parent Common Shares
        to the holders of Exchangeable Shares in accordance with the provisions
        of the Liquidation Call Right, the Retraction Call Right or the Redemption
        Call Right, as the case may be.

	2.2 	Segregation of Funds 

     Parent will cause ExchangeCo to
  deposit a sufficient amount of funds in a separate account of ExchangeCo and
  segregate a sufficient amount of such other assets and property as is necessary
  to enable ExchangeCo to pay dividends when due and to pay or otherwise satisfy
  its respective obligations under Article 5, 6 or 7 of the Share Provisions,
  as applicable. 

	2.3 	Reservation of Parent Common Shares 

     Parent hereby represents, warrants
  and covenants in favour of ExchangeCo that Parent has reserved for issuance
  and will, at all times while any Exchangeable Shares (other than Exchangeable
  Shares held by Parent or its Affiliates) are outstanding, keep available, free
  from pre-emptive and other rights, out of its authorized and unissued capital
  stock such number of Parent Common Shares (or other shares or securities into
  which Parent Common Shares may be reclassified or changed as contemplated by
  Section 2.7 hereof) (a) as is equal to the sum of (i) the number of Exchangeable
  Shares issued and outstanding from time to time and (ii) the number of Exchangeable
  Shares issuable upon the exercise of all rights to acquire Exchangeable Shares
  outstanding from time to time and (b) as are now and may hereafter be required
  to enable and permit Parent to meet its obligations under the Voting and Exchange
  Trust Agreement and under any other security or commitment pursuant to which
  Parent may now or hereafter be required to issue Parent Common Shares, to enable
  and permit ExchangeCo to meet its obligations under each of the Liquidation
  Call Right, the Retraction Call Right and the Redemption Call Right and its
  respective obligations hereunder and under the Share Provisions. 

	2.4 	Notification of Certain Events 

     In order to assist Parent to comply
  with its obligations hereunder and to permit ExchangeCo to exercise the Liquidation
  Call Right, the Retraction Call Right and the Redemption Call Right, ExchangeCo
  will notify Parent of each of the following events at the time set forth below:

	 	(a) 	 in the event of any determination by the Board of Directors
        of ExchangeCo to institute voluntary liquidation, dissolution or winding-up
        proceedings with respect to ExchangeCo or to effect any other distribution
        of the assets of ExchangeCo among its shareholders for the purpose of
        winding up its affairs, at least 60 days prior to the proposed effective
        date of such liquidation, dissolution, winding-up or other distribution;

	 	 	 
	 	(b) 	 promptly, upon the earlier of receipt by ExchangeCo
        of notice of and ExchangeCo otherwise becoming aware of any threatened
        or instituted claim, suit, petition or other

- 3 - 

	 		 proceedings with respect to the involuntary liquidation,
        dissolution or winding-up of ExchangeCo or to effect any other distribution
        of the assets of ExchangeCo among its shareholders for the purpose of
        winding up its affairs;

	 	 	 
	 	(c) 	 immediately, upon receipt by ExchangeCo of a Retraction
        Request;

	 	 	 
	 	(d) 	 on the same date on which notice of redemption is given
        to holders of Exchangeable Shares, upon the determination of a Redemption
        Date in accordance with the Share Provisions; and

	 	 	 
	 	(e) 	 as soon as practicable upon the issuance by ExchangeCo
        of any Exchangeable Shares or rights to acquire Exchangeable Shares (other
        than the issuance of Exchangeable Shares and rights to acquire Exchangeable
        Shares in exchange for outstanding Common Shares of the Company pursuant
        to the Arrangement).

	2.5 	Delivery of Parent Common Shares to ExchangeCo
    

     In furtherance of its obligations
  under Sections 2.1(d) and (e) hereof, upon notice from ExchangeCo of any event
  that requires ExchangeCo to cause to be delivered Parent Common Shares to any
  holder of Exchangeable Shares, Parent shall forthwith issue and deliver or cause
  to be delivered to ExchangeCo the requisite number of Parent Common Shares to
  be received by, and issued to or to the order of, the former holder of the surrendered
  Exchangeable Shares, as ExchangeCo shall direct. All such Parent Common Shares
  shall be duly authorized and validly issued as fully paid and non-assessable
  and shall be free and clear of any lien, claim or encumbrance. In consideration
  of the issuance and delivery of each such Parent Common Share, ExchangeCo shall
  issue to Parent, or as Parent shall direct, common shares of ExchangeCo having
  equivalent value. 

	2.6 	Qualification of Parent Common Shares 

     Parent will in good faith expeditiously
  take all such reasonable actions and do all such reasonable things as are necessary
  or desirable to cause any Parent Common Shares (or other shares or securities
  into which Parent Common Shares may be reclassified or changed as contemplated
  by Section 2.7 hereof) to be issued and delivered hereunder, to be listed, quoted
  or posted for trading on all stock exchanges and quotation systems on which
  outstanding Parent Common Shares (or such other shares or securities) have been
  listed by Parent and remain listed and quoted or posted for trading. 

	2.7 	Economic Equivalence 

	 	(a) 	 Parent will not without prior approval of
        ExchangeCo and the prior approval of the holders of the Exchangeable Shares
        given in accordance with Section 10.2 of the Share Provisions:

	 	 	 	 
	 		(i) 	 issue or distribute Parent Common Shares (or securities
        exchangeable for or convertible into or carrying rights to acquire Parent
        Common Shares) to the holders of all or substantially all of the then
        outstanding Parent Common Shares by way of stock dividend or other distribution,
        other than an issue of Parent Common Shares (or securities exchangeable
        for or convertible into or carrying rights to acquire Parent Common Shares)
        to holders of Parent Common Shares who exercise an option to receive dividends
        in Parent Common Shares (or securities exchangeable for or convertible
        into or carrying rights to acquire Parent Common Shares) in lieu of receiving
        cash dividends; or

- 4 - 

	 		(ii) 	 issue or distribute rights, options or warrants to the
        holders of all or substantially all of the then outstanding Parent Common
        Shares entitling them to subscribe for or to purchase Parent Common Shares
        (or securities exchangeable for or convertible into or carrying rights
        to acquire Parent Common Shares); or

	 	 	 	 
	 		(iii) 	 issue or distribute to the holders of all or substantially
        all of the then outstanding Parent Common Shares (A) shares or securities
        of Parent of any class other than Parent Common Shares (other than shares
        convertible into or exchangeable for or carrying rights to acquire Parent
        Common Shares), (B) rights, options or warrants other than those referred
        to in Section 2.7(a)(ii) above, (C) evidences of indebtedness of Parent
        or (D) assets of Parent, unless the economic equivalent (as determined
        by the Board of Directors of ExchangeCo as contemplated by Section 2.7(d)
        hereof) on a per share basis of such rights, options, securities, shares,
        evidences of indebtedness or other assets is issued or distributed simultaneously
        to holders of the Exchangeable Shares; provided that, for greater certainty,
        the above restrictions shall not apply to any securities issued or distributed
        by Parent in order to give effect to and to consummate the transactions
        contemplated by, and in accordance with, the Arrangement Agreement.

	 	 	 	 
	 	(b) 	 Parent will not without the prior approval
        of ExchangeCo and the prior approval of the holders of the Exchangeable
        Shares given in accordance with Section 10.2 of the Share Provisions:

	 	 	 	 
	 		(i) 	 subdivide, redivide or change the then outstanding Parent
        Common Shares into a greater number of Parent Common Shares; or

	 	 	 	 
	 		(ii) 	 reduce, combine, consolidate or change the then outstanding
        Parent Common Shares into a lesser number of Parent Common Shares; or

	 	 	 	 
	 		(iii) 	 reclassify or otherwise change Parent Common Shares
        or effect an amalgamation, merger, reorganization or other transaction
        affecting Parent Common Shares,

	 	 	 	 
	 		 unless the same or an economically equivalent
        change (as determined by the Board of Directors of ExchangeCo as contemplated
        by Section 2.7(d) hereof) shall simultaneously be made to, or in the rights
        of the holders of, the Exchangeable Shares.

	 	 	 	 
	 	(c) 	 Parent will ensure that the record date for
        any event referred to in Section 2.7(a) or 2.7(b) above, or (if no record
        date is applicable for such event) the effective date for any such event,
        is not less than five Business Days after the date on which such event
        is declared or announced by Parent (with contemporaneous notification
        thereof by Parent to ExchangeCo).

	 	 	 	 
	 	(d) 	 The Board of Directors of ExchangeCo shall
        determine, in good faith and in its sole discretion, economic equivalence
        for the purposes of any event referred to in Section 2.7(a) or 2.7(b)
        hereof and each such determination shall be conclusive and binding on
        Parent. In making each such determination, the following factors shall,
        without excluding other factors determined by the Board of Directors of
        ExchangeCo to be relevant, be considered by the Board of Directors of
        ExchangeCo:

- 5 - 

	 	(i) 	 in the case of any stock dividend or other distribution
        payable in Parent Common Shares, the number of such shares issued in proportion
        to the number of Parent Common Shares previously outstanding;

	 	 	 
	 	(ii) 	 in the case of the issuance or distribution of any rights,
        options or warrants to subscribe for or purchase Parent Common Shares
        (or securities exercisable or exchangeable for or convertible into or
        carrying rights to acquire Parent Common Shares), the relationship between
        the exercise price of each such right, option or warrant and the current
        market value (as determined by the Board of Directors of ExchangeCo in
        the manner above contemplated) of a Parent Common Share;

	 	 	 
	 	(iii) 	 in the case of the issuance or distribution of any other
        form of property (including without limitation any shares or securities
        of Parent of any class other than Parent Common Shares, any rights, options
        or warrants other than those referred to in Section 2.7(d)(ii) above,
        any evidences of indebtedness of Parent or any assets of Parent), the
        relationship between the fair market value (as determined by the Board
        of Directors of ExchangeCo in the manner above contemplated) of such property
        to be issued or distributed with respect to each outstanding Parent Common
        Share and the current market value (as determined by the Board of Directors
        of ExchangeCo in the manner above contemplated) of a Parent Common Share;

	 	 	 
	 	(iv) 	 in the case of any subdivision, redivision or change
        of the then outstanding Parent Common Shares into a greater number of
        Parent Common Shares or the reduction, combination, consolidation or change
        of the then outstanding Parent Common Shares into a lesser number of Parent
        Common Shares or any amalgamation, merger, reorganization or other transaction
        affecting Parent Common Shares, the effect thereof upon the then outstanding
        Parent Common Shares; and

	 	 	 
	 	(v) 	 in all such cases, the general taxation consequences
        of the relevant event to holders of Exchangeable Shares to the extent
        that such consequences may differ from the taxation consequences to holders
        of Parent Common Shares as a result of differences between taxation laws
        of Canada and the United States (except for any differing consequences
        arising as a result of differing marginal taxation rates and without regard
        to the individual circumstances of holders of Exchangeable Shares).

For purposes of the foregoing determinations,
  the current market value of any security listed and traded or quoted on a securities
  exchange shall be the weighted average of the daily trading prices of such security
  during a period of not less than 20 consecutive trading days ending not more
  than three trading days before the date of determination on the principal securities
  exchange on which such securities are listed and traded or quoted; provided,
  however, that if in the opinion of the Board of Directors of ExchangeCo the
  public distribution or trading activity of such securities during such period
  does not create a market which reflects the fair market value of such securities,
  then the current market value thereof shall be determined by the Board of Directors
  of ExchangeCo, in good faith and in its sole discretion, and provided further
  that any such determination by the Board of Directors of ExchangeCo shall be
  conclusive and binding on Parent. 

- 6 - 

	 	(e) 	 ExchangeCo agrees that, to the extent required, upon
        due notice from Parent, ExchangeCo will use its best efforts to take or
        cause to be taken such steps as may be necessary for the purposes of ensuring
        that appropriate dividends are paid or other distributions are made by
        ExchangeCo, or subdivisions, redivisions or changes are made to the Exchangeable
        Shares, in order to implement the required economic equivalent with respect
        to the Parent Common Shares and Exchangeable Shares as provided for in
        this Section 2.7.

	2.8 	Tender Offers 

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

	2.9 	Ownership of Outstanding Shares 

     Without the prior approval of ExchangeCo
  and the prior approval of the holders of the Exchangeable Shares given in accordance
  with Section 10.2 of the Share Provisions, Parent covenants and agrees in favour
  of ExchangeCo that, as long as any outstanding Exchangeable Shares are owned
  by any person or entity other than Parent or any of its Affiliates, Parent will
  be and remain the direct or indirect beneficial owner of all issued and outstanding
  voting shares in the capital of ExchangeCo. 

	2.10 	Parent and Affiliates Not to Vote Exchangeable
      Shares 

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

	2.11 	Rule 10b-18 Purchases 

     For certainty, nothing contained
  in this Agreement, including without limitation the obligations of Parent contained
  in Section 2.8 hereof, shall limit the ability of Parent or ExchangeCo to 

- 7 - 

make a “Rule 10b-18 Purchase” of Parent Common Shares
  pursuant to Rule 10b-18 of the U.S. Securities Exchange Act of 1934, as amended,
  or any successor provisions thereof. 

ARTICLE 3 

  PARENT SUCCESSORS 

	3.1 	Certain Requirements in Respect of Combination,
      etc. 

     Parent shall not consummate any
  transaction (whether by way of reconstruction, reorganization, consolidation,
  merger, transfer, sale, lease or otherwise) whereby all or substantially all
  of its undertaking, property and assets would become the property of any other
  person or, in the case of a merger, of the continuing corporation resulting
  therefrom unless, but may do so if: 

	 	(a) 	 such other person or continuing corporation (the “Parent
        Successor”) by operation of law, becomes, without more, bound
        by the terms and provisions of this Agreement or, if not so bound, executes,
        prior to or contemporaneously with the consummation of such transaction,
        an agreement supplemental hereto and such other instruments (if any) as
        are reasonably necessary or advisable to evidence the assumption by the
        Parent Successor of liability for all moneys payable and property deliverable
        hereunder and the covenant of such Parent Successor to pay and deliver
        or cause to be delivered the same and its agreement to observe and perform
        all the covenants and obligations of Parent under this Agreement; and

	 	 	 
	 	(b) 	 such transaction shall be upon such terms and conditions
        as substantially to preserve and not to impair in any material respect
        any of the rights, duties, powers and authorities of the other parties
        hereunder.

	3.2 	Vesting of Powers in Successor 

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

	3.3 	Wholly-Owned Subsidiaries 

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

- 8 - 

ARTICLE 4 

  GENERAL 

	4.1 	Term 

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

	4.2 	Changes In Capital of Parent and ExchangeCo
    

     At all times after the occurrence
  of any event contemplated pursuant to Sections 2.7 and 2.8 hereof or otherwise,
  as a result of which either Parent Common Shares or the Exchangeable Shares
  or both are in any way changed, this Agreement shall forthwith be amended and
  modified as necessary in order that it shall apply with full force and effect,
  mutatis mutandis, to all new securities into which Parent Common Shares or the
  Exchangeable Shares or both are so changed and the parties hereto shall execute
  and deliver an agreement in writing giving effect to and evidencing such necessary
  amendments and modifications. 

	4.3 	Severability 

     If any provision of this Agreement
  is held to be invalid, illegal or unenforceable, the validity, legality or enforceability
  of the remainder of this Agreement shall not in any way be affected or impaired
  thereby and this Agreement shall be carried out as nearly as possible in accordance
  with its original terms and conditions. 

	4.4 	Amendments, Modifications 

     This Agreement may not be amended
  or modified except by an agreement in writing executed by ExchangeCo and Parent
  and approved by the holders of the Exchangeable Shares in accordance with Section
  10.2 of the Share Provisions. 

	4.5 	Ministerial Amendments 

     Notwithstanding the provisions
  of Section 4.4, the parties to this Agreement may in writing at any time and
  from time to time, without the approval of the holders of the Exchangeable Shares,
  amend or modify this Agreement for the purposes of: 

	 	(a) 	 adding to the covenants of any or all parties provided
        that the Board of Directors of each of ExchangeCo and Parent shall be
        of the good faith opinion that such additions will not be prejudicial
        to the rights or interests of the holders of the Exchangeable Shares;

	 	 	 
	 	(b) 	 making such amendments or modifications not inconsistent
        with this Agreement as may be necessary or desirable with respect to matters
        or questions which, in the good faith opinion of the Board of Directors
        of each of ExchangeCo and Parent, it may be expedient to make, provided
        that each such Board of Directors shall be of the good faith opinion that
        such amendments or modifications will not be prejudicial to the rights
        or interests of the holders of the Exchangeable Shares; or

- 9 - 

	 	(c) 	 making such changes or corrections which, on the advice
        of counsel to ExchangeCo and Parent, are required for the purpose of curing
        or correcting any ambiguity or defect or inconsistent provision or clerical
        omission or mistake or manifest error, provided that the Boards of Directors
        of each of ExchangeCo and Parent shall be of the good faith opinion that
        such changes or corrections will not be prejudicial to the rights or interests
        of the holders of the Exchangeable Shares.

	4.6 	Meeting to Consider Amendments 

     ExchangeCo, at the request of Parent,
  shall call a meeting or meetings of the holders of the Exchangeable Shares for
  the purpose of considering any proposed amendment or modification requiring
  approval pursuant to Section 4.4 hereof. Any such meeting or meetings shall
  be called and held in accordance with the bylaws of ExchangeCo, the Share Provisions
  and all applicable laws. 

	4.7 	Amendments Only in Writing 

     No amendment to or modification
  or waiver of any of the provisions of this Agreement otherwise permitted hereunder
  shall be effective unless made in writing and signed by all of the parties hereto.

	4.8 	Enurement 

     This Agreement shall be binding
  upon and enure to the benefit of the parties hereto and their respective successors
  and assigns. 

	4.9 	Notices to Parties 

     All notices and other communications
  required or permitted to be delivered to a party under this Agreement shall
  be in writing and shall be deemed to have been properly delivered, given or
  received (a) upon receipt when delivered by hand or (b) two business days after
  being sent by registered mail or by courier or express delivery service or by
  facsimile, provided that in each case the notice or communication is sent to
  the address or facsimile telephone number set forth beneath the name of such
  party below: 

	 	(a) 	if to Parent: 	  
	 	  	  	  
	 	  	                   CounterPath
      Solutions, Inc. 
	 	  	           
             Suite 300, One Bentall Centre 
	 	  	           
             505 Burrard Street 
	 	  	           
             Vancouver, BC V7X 1M3 
	 	  	  	  
	 	  	             
           Attention: 	President 
	 	  	             
           Fax: 	(604) 320-3399 
	 	  	  	  
	 	  	  	  
	 	(b) 	if to ExchangeCo: 	  
	 	  	  	  
	 	  	           
             6789722 Canada Inc. 
	 	  	           
             Suite 300, One Bentall Centre 
	 	  	           
             505 Burrard Street 
	 	  	                  
      Vancouver, BC V7X 1M3 

- 10 - 

	 	                  
      Attention: 	President 
	 	                  
      Fax: 	(604) 320-3399 

	4.10 	Counterparts 

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

	4.11 	Jurisdiction 

     This Agreement shall be construed
  and enforced in accordance with the laws of the Province of British Columbia
  and the laws of Canada applicable therein. 

	4.12 	Fax Delivery 

     This Agreement may be executed
  by delivery of executed signature pages by fax and such fax execution will be
  effective for all purposes. 

	4.13 	Attornment 

     Parent agrees that any action or
  proceeding arising out of or relating to this Agreement may be instituted in
  the courts of British Columbia, waives any objection which it may have now or
  hereafter to the venue of any such action or proceeding, irrevocably submits
  to the jurisdiction of the said courts in any such action or proceeding and
  hereby appoints ExchangeCo at its registered office in the Province of British
  Columbia as attorney for service of process. 

     IN WITNESS WHEREOF, the parties
  hereto have caused this Agreement to be duly executed as of the date first above
  written. 

COUNTERPATH SOLUTIONS, INC. 

	Per: 	 	 
	Name: 	 	 
	Title: 	 	 
	  	 	 
	  	 	 
	6789722 CANADA INC. 	 
	  	 	 
	Per: 	 	 
	Name: 	 	 
	Title: 	 	 

- 11 - 

 

	
SCHEDULE H
	
	 

	
	
TO THE ARRANGEMENT AGREEMENT AMONG
	
	
COUNTERPATH SOLUTIONS, INC, 6789722 CANADA INC. AND
	
	
NEWHEIGHTS SOFTWARE CORPORATION
	
	 

	
	
WESLEY CLOVER SUBSCRIPTION AGREEMENT
	

SUBSCRIPTION AGREEMENT 

	To: 	Counterpath Solutions, Inc. (the “Corporation”).
    

The undersigned (the “Subscriber”) hereby tenders
  to the Corporation this subscription offer which, upon acceptance by the Corporation,
  will constitute an agreement of the Subscriber to subscribe for and take up
  and, on the part of the Corporation, to issue to the Subscriber, 8,750,000 common
  shares in the capital of the Corporation at a subscription price of U.S. $0.40
  per Common Share, on the terms and subject to the conditions set out in this
  Subscription Agreement. 

DATED at ________________, this ________day of June, 2007. 

	  	  	 	Wesley Clover Corporation 
	  	  	 	555 Legget Drive, 
	  	  	 	Suite 534 - Tower B 
	Wesley Clover Corporation 	 	Kanata, Ontario, Canada 
	  	  	 	K2K 2X3
    
	(Name of Subscriber - please print) 	 	(Subscriber’s Address) 
	  	  	 	  
	by: 	/s/ Jose Medeiros 	 	  
	  	Jose Medeiros 	 	  
	  	President and Chief Operating Officer 	 	  
	  	  	 	1-613-271-6305 
	Signature 	 	(Telephone Number) 
	  	  	 	  
	  	  	 	1-613-271-9810 
	(Please print name of individual whose signature
    	 	(Facsimile Number) 
	appears above if different than the name of the
    	 	  
	Subscriber printed above) 	 	JMedeiros@wesleyclover.com 
	  	  	 	(E-mail Address) 

	 
	 
	ACCEPTANCE: The Corporation hereby accepts the subscription
      as to 8,750,000 Common Shares on the terms and subject to the conditions
      contained in this Subscription Agreement. 
	
	 	
	Accepted this _____day of June, 2007 	
	 	 
	COUNTERPATH SOLUTIONS, INC. 

	By: 	/s/ Donovan Jones 	 
	 	 	 
	Name: 	Donovan Jones 	 
	 	 	 
	Title: 	President and Chief Operating Officer 	 

ARTICLE 1 

  DEFINITIONS AND INTERPRETATION 

	1.1 	 Definitions: In this Subscription Agreement,
        unless inconsistent with the subject matter or context thereof, the following
        capitalized words will have the following meaning:

	 	 	 
		(a) 	 “Arrangement Agreement” means the Arrangement
        Agreement dated June ___, 2007 between the Corporation and NewHeights
        Software Corporation;

	 	 	 
		(b) 	 “Closing Date” means the date on which
        the transactions contemplated in the Plan of Arrangement are completed;

	 	 	 
		(c) 	 “Common Shares” means the shares of
        common stock of the Corporation, as constituted as of the date hereof;

	 	 	 
		(d) 	 “Escrow Agent” means the escrow agent
        appointed pursuant to the Escrow Agreement;

	 	 	 
		(e) 	 “Escrow Agreement” means the escrow
        agreement to be entered into on the Closing Date between the Subscriber,
        the Corporation and the Escrow Agent, such agreement to be substantially
        in the form attached hereto as Schedule “C”;

	 	 	 
		(f) 	 “First Subscription” has the meaning
        ascribed to such term in Section 2.1(a);

	 	 	 
		(g) 	 “First Subscription Date” has the meaning
        ascribed to such term in Section 2.1(a);

	 	 	 
		(h) 	 “Plan of Arrangement” means the Plan
        of Arrangement contemplated in the Arrangement Agreement;

	 	 	 
		(i) 	 “Second Subscription” has the meaning
        ascribed to such term in Section 2.1(b);

	 	 	 
		(j) 	 “Second Subscription Date” has the
        meaning ascribed to such term in Section 2.1(b);

	 	 	 
		(k) 	 “Subscription” means the subscription
        by the Subscriber for 8,750,000 Common Shares at a subscription price
        of U.S. $0.40 per Common Share,

	 	 	 
		(l) 	 “Subscription Date” means the First
        Subscription Date, the Second Subscription Date or the Third Subscription
        Date, as the case may be;

	 	 	 
		(m) 	 “Subscription Instalment” means the
        First Subscription, the Second Subscription and the Third Subscription,
        as the case may be;

	 	 	 
		(n) 	 “Subscription Price” means $0.40 per
        Common Share subscribed for herein for an aggregate subscription price
        of $3,500,000;

	 	 	 
		(o) 	 “Third Subscription” has the meaning
        ascribed to such term in Section 2.1(c);

	 	 	 
		(p) 	 “Third Subscription Date” has the meaning
        ascribed to such term in Section 2.1(c); and

	 	 	 
		(q) 	 “US Securities Act” mean the U.S. Securities
        Act of 1933, as amended.

	 	 	 
	1.2 	 Interpretation: In this Subscription
        Agreement:

	 	 	 
		(a) 	 the division of this Subscription Agreement into paragraphs
        and the insertion of headings are for convenience of reference only and
        shall not effect the construction or interpretation of this Subscription
        Agreement;

1 

	 	(b) 	 the terms “hereof”, “hereunder”
        and similar expressions refer to this Subscription Agreement and not to
        any particular article or section hereof and include any agreement supplemental
        hereto and references hereinto articles and sections are to articles and
        sections of this Subscription Agreement;

	 	 	 	 
	 	(c) 	 words importing the singular number include
        the plural and vice versa, words importing any gender include all genders
        and words importing persons include individuals, partnerships, associations,
        trusts, unincorporated associations and corporations;

	 	 	 	 
	 	(d) 	 all references to “$” or currency
        herein, other than in Schedule “A”, are to lawful money of the
        United States; and

	 	 	 	 
	 	(e) 	 the following are the schedules hereto which
        are incorporated by reference and deemed to be part hereof:

	 	 	 	 
	 		(i) 	 Schedule “A” – Canadian Accredited Investor
        Certificate;

	 	 	 	 
	 		(ii) 	 Schedule “B” – U.S. Accredited Investor
        Certificate; and

	 	 	 	 
	 		(iii) 	 Schedule “C” – Form of Escrow Agreement.

ARTICLE 2 

  SUBSCRIPTION 

	2.1 	 Subscription for Common Shares: On
        the terms and subject to the conditions hereof, the Subscriber hereby
        confirms its irrevocable subscription for and agrees to purchase and take
        up from the Corporation the aggregate number of Common Shares as provided
        for on the first page of this Subscription Agreement at a price of $0.40
        per Common Share for an aggregate subscription price of $3,500,000. The
        Subscription shall be completed in three instalments in accordance with
        the following:

	 	 	 
		(a) 	 as to 3,750,000 Common Shares (the “First Subscription”),
        on the first business day that is three (3) months following the Closing
        Date (the “First Subscription Date”);

	 	 	 
		(b) 	 as to 2,500,000 Common Shares (the “Second Subscription”),
        on the first business day that is six (6) months following the Closing
        Date (the “Second Subscription Date”); and

	 	 	 
		(c) 	 as to 2,500,000 Common Shares (the “Third Subscription”),
        on the first business day that is seven (7) months following the Closing
        Date (the “Third Subscription Date”);

	 	 	 
		 provided, however, that notwithstanding the
        foregoing the Subscriber may, upon written notice to the Corporation,
        agree to subscribe for all or any part of the Common Shares at any earlier
        date than contemplated above.

	 	 	 
	2.2 	 Acceptance by the Corporation: The
        Subscriber acknowledges that the Subscription contemplated hereby is subject
        to acceptance by the Corporation and to the fulfilment of certain other
        terms and conditions by the Subscriber and that this Subscription Agreement
        shall be effective and binding on the Subscriber and the Corporation upon
        acceptance by the Corporation as evidenced by its execution on the first
        page hereof.

ARTICLE 3 

  REPRESENTATIONS AND WARRANTIES 

	3.1 	 Representations and Warranties of the Subscriber:
        By executing this Subscription Agreement, the Subscriber represents and
        warrants to the Corporation and acknowledges that the Corporation is relying
        thereon that:

	 	 	 
		(a) 	 by reason of the Subscriber’s business and financial
        experience, it has such knowledge, sophistication and experience in business
        and financial matters that it is capable of evaluating the merits and
        risks of an investment in the Common Shares and the terms of this Subscription
        Agreement;

2 

	 	(b) 	 the Subscriber is an accredited investor (“Accredited
        Investor”) as such term is defined in both National Instrument
        45-106 “Prospectus and Registration Exemptions” (“NI
        45-106”) and in Rule 501(a) promulgated under the US Securities
        Act as indicated by the Subscriber on the certificates attached as Schedule
        “A” and Schedule “B” hereto;

	 	 	 
	 	(c) 	 the Subscriber is subscribing for the Common Shares
        for its own account and not for the account or benefit of any other person,
        for investment purposes only, and not with a view to resell or other distribution
        of the Common Shares in violation of NI 45-106, the US Securities Act
        or any state or provincial securities laws;

	 	 	 
	 	(d) 	 the Subscriber recognizes the speculative nature of
        this investment and is able to bear the economic risk that the Subscriber
        assumes;

	 	 	 
	 	(e) 	 in making the decision to subscribe for the Common Shares
        the Subscriber has relied solely upon the information provided in this
        Subscription Agreement and the Subscriber’s own investigation of
        the Corporation, which investigation has provided the Subscriber with
        all the information the Subscriber considers necessary for purposes of
        its investment decision;

	 	 	 
	 	(f) 	 the Subscriber has been advised to obtain and has either
        declined to or has obtained, at its own expense, appropriate professional
        advice regarding the investment, tax and legal consequences of subscribing
        for and an investment in the Common Shares contemplated hereunder;

	 	 	 
	 	(g) 	 the Subscriber is aware of the applicable restrictions
        on the resale of the Common Shares imposed by securities legislation in
        the jurisdiction in which it resides and that the Subscriber may not be
        able to sell such Common Shares except in accordance with applicable securities
        legislation and regulatory policies for compliance with applicable resale
        restrictions;

	 	 	 
	 	(h) 	 the Subscriber was contacted regarding the subscription
        for the Common Shares by the Corporation (or its authorized agents or
        representatives) with whom the Subscriber had a pre-existing relationship
        and no Common Shares were offered or sold to the Subscriber by means of
        any form of general solicitation, advertisement, article, notice or other
        communication published in a newspaper, magazine, internet website or
        similar media or broadcast over television or radio, or otherwise generally
        available;

	 	 	 
	 	(i) 	 the Subscriber is resident in the jurisdiction set out
        in the “Subscriber’s Address” on the first page hereof,
        and the subscription for and issue to the Subscriber of the Common Shares,
        and all acts, solicitation, conduct and negotiation directly or indirectly
        in furtherance of this subscription has occurred only in that jurisdiction;

	 	 	 
	 	(j) 	 the Subscriber was not formed for the purpose of subscribing
        for the Common Shares;

	 	 	 
	 	(k) 	 the Subscriber acknowledges and understands that no
        person has made any written or oral representation (i) that any person
        will resell or repurchase any or all of the Common Shares; or (ii) as
        to future price or value of the Common Shares;

	 	 	 
	 	(l) 	 the Subscriber is not a US Person (as defined in Regulation
        S under the US Securities Act, which definition includes, but is not limited
        to, an individual resident in the United States, an estate or trust of
        which any executor or administrator or trustee, respectively, is a US
        Person and any partnership or corporation organized or incorporated under
        the laws of the United States) and is not purchasing the Common Shares
        on behalf of, or for the account or benefit of, a person in the United
        States or a US Person;

	 	 	 
	 	(m) 	 the Subscriber understands and acknowledges that the
        Common Shares have not been and will not be registered under the US Securities
        Act or any state securities laws, and that the Common Shares are intended
        to be exempt from registration under the US Securities Act pursuant to
        the provisions of Rule 506 of Regulation D thereunder;

3 

	 	(n) 	 the Subscriber consents to the placement of a legend
        on any certificate or other document evidencing the Common Shares to the
        effect that such securities have not been registered under the US Securities
        Act or any state securities or “blue sky” laws and setting forth
        or referring to the restrictions on transferability and sale thereof contained
        in this Subscription Agreement such legend to be substantially as follows:

	 	 “THE SECURITIES REPRESENTED
        HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
        OF 1933, AS AMENDED (THE “ACT”). THE HOLDER HEREOF, BY PURCHASING
        SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE CORPORATION THAT SUCH SECURITIES
        MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY (A) TO THE CORPORATION,
        (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 903 OR RULE 904
        OF REGULATION S UNDER THE ACT, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION
        UNDER THE ACT PROVIDED BY RULE 144 THEREUNDER, IF AVAILABLE, AND IN COMPLIANCE
        WITH ANY APPLICABLE STATE SECURITIES LAWS, OR (D) PURSUANT TO ANOTHER
        EXEMPTION FROM REGISTRATION UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES
        LAWS; PROVIDED THAT IN THE CASE OF SUBPARAGRAPHS (C) AND (D), THE CORPORATION
        HAS RECEIVED A WRITTEN OPINION OF LEGAL COUNSEL REASONABLY SATISFACTORY
        TO IT TO THE EFFECT THAT THE PROPOSED TRANSFER MAY BE EFFECTED WITHOUT
        REGISTRATION UNDER THE ACT OR ANY APPLICABLE STATE SECURITIES LAWS.”
      
	 

		(o) 	 the Subscriber acknowledges and consents to the placement
        of any required legend under Canadian securities laws on any certificate
        evidencing the Common Shares issued to the Subscriber.

	 	 	 
		(p) 	 the Subscriber has full power and authority to execute
        and deliver this Subscription Agreement and to subscribe for the Common
        Shares, and this Subscription Agreement has been duly and validly executed
        and delivered by the Subscriber and constitutes a legal, valid and binding
        obligation of the Subscriber, enforceable against the Subscriber in accordance
        with its terms;

	 	 	 
		(q) 	 if the Subscriber is a corporation, partnership, limited
        liability company, trust, employee benefit plan, individual retirement
        account or other tax-exempt entity, it is authorized and qualified to
        invest in the Corporation and the person signing this Subscription Agreement
        on behalf of such entity has been duly authorized by such entity to do
        so;

	 	 	 
		(r) 	 the Subscriber has not engaged, consented to or authorized
        any broker, finder or intermediary to act on its behalf, directly or indirectly,
        as a broker, finder or intermediary in connection with the transactions
        contemplated by this Subscription Agreement;

	 	 	 
		(s) 	 the Subscriber understands and acknowledges that, except
        as otherwise set forth herein, the subscription hereunder is irrevocable
        by the Subscriber and except as permitted by law, the Subscriber is not
        entitled to cancel, terminate or revoke this Subscription Agreement; and

	 	 	 
		(t) 	 the entering into of this Subscription Agreement and
        the transactions contemplated hereby will not result in the violation
        of any of the terms and provisions of any law applicable to, or the constating
        documents of, the Subscriber or of any agreement, written or oral, to
        which the Subscriber may be a party or by which it is bound.

	 	 	 
	3.2 	 Survival of Representations, Etc.:
        The representations and warranties of the Subscriber herein are made by
        the Subscriber with the knowledge and intent that they are being and will
        be relied upon by the Corporation in connection with the transactions
        contemplated hereby, including for purposes of determining the suitability
        of the Subscriber as a subscriber for Common Shares. The Subscriber hereby
        undertakes to notify the Corporation of any change in any of its representations
        or warranties set forth herein that may arise prior to the completion
        of the

4 

		 subscriptions for the Common Shares hereunder.
        The representations and warranties of the Subscriber herein shall survive
        the closing of the transactions contemplated hereby.

	 	 	 
	3.3 	 Representations and Warranties of the Corporation:
        The Corporation represents and warrants to the Subscriber, and acknowledges
        that the Subscriber is relying thereon, that:

	 	 	 
		(a) 	 the Corporation is a valid and subsisting corporation
        formed under the laws of Nevada and is duly registered and licensed to
        carry on business in each jurisdiction in which it now carries on business
        or has property or assets;

	 	 	 
		(b) 	 the representations and warranties of the Corporation
        in the Arrangement Agreement are true and correct;

	 	 	 
		(c) 	 the Common Shares subscribed for herein, when issued
        and delivered to the Subscriber on the applicable Subscription Date, will
        be duly and validly issued and outstanding common stock in the capital
        of the Corporation and upon the portion of the Subscription Price attributable
        to such Subscription Instalment being paid to the Corporation, will be
        fully paid and non-assessable;

	 	 	 
		(d) 	 the issuance of the Common Shares by the Corporation
        hereunder does not and will not contravene, conflict with or result in
        a violation of any terms of the Corporation’s constating documents
        or any agreement or instrument to which the Corporation is a party;

	 	 	 
		(e) 	 this Subscription Agreement has been or will be upon
        execution and delivery thereof, duly authorized by all necessary action
        on the part of the Corporation, validly executed and delivered and constitute
        a legal, valid and binding obligation of the Corporation, enforceable
        against it in accordance with its terms; and

	 	 	 
		(f) 	 no order ceasing or suspending trading in securities
        of the Corporation nor prohibiting the sale of such securities has been
        issued and is outstanding against the Corporation or its directors, officers
        or promoters.

	 	 	 
	3.4 	 Survival of Representations, Etc.:
        The representations and warranties of the Corporation herein are made
        by the Corporation with the knowledge and intent that they are being and
        will be relied upon by the Subscriber in connection with the transactions
        contemplated hereby and shall survive the closing of the transactions
        contemplated hereby.

ARTICLE 4 

  COVENANTS 

	4.1 	 Covenants of the Subscriber: In connection
        with the Subscription and the issuance of Common Shares hereunder, the
        Subscriber covenants and agrees with the Corporation that:

	 	 	 	 
		(a) 	 if required by applicable securities legislation,
        policy or order or by any securities commission, stock exchange or other
        regulatory authority, the Subscriber shall execute, deliver and file or
        assist the Corporation in obtaining and filing such reports, undertakings
        and other documents relating to its subscription as may be required;

	 	 	 	 
		(b) 	 the Subscriber, if it decides to offer, sell
        or otherwise transfer all or any part of the Common Shares, will not offer,
        sell or otherwise transfer any of such securities (other than pursuant
        to an effective registration statement under the US Securities Act and
        in compliance with all applicable state and provincial securities laws),
        directly or indirectly, unless:

	 	 	 	 
			(i) 	 the sale is to the Corporation; or

	 	 	 	 
			(ii) 	 the sale is made outside the United States in accordance
        with the requirements of Rule 903 or Rule 904 of Regulation S under the
        US Securities Act; or

5 

	 	(iii) 	 the sale is made pursuant to the exemption from registration
        under the US Securities Act provided by Rule 144 thereunder, if available,
        and in compliance with any applicable state securities laws; or

	 	 	 
	 	(iv) 	 the sale is made pursuant to another exemption from
        registration under the US Securities Act and any applicable state securities
        laws,

and in each case the sale is made in
  compliance with all applicable state and provincial securities laws; provided
  that in the case of subparagraphs (iii) or (iv), a written opinion of legal
  counsel reasonably satisfactory to the Corporation is addressed and provided
  to the Corporation, to the effect that the proposed transfer may be effected
  without registration under the US Securities Act or any applicable state securities
  laws; and 

		(c) 	 the Subscriber hereby agrees to hold the Corporation
        and its directors, officers, employees, affiliates, controlling persons
        and agents and their respective officers, directors, employees, counsel,
        controlling persons and agents, and their respective heirs, representatives,
        successors and assigns harmless and to indemnify them against all liabilities,
        costs and expenses incurred by them as a result of a material false breach
        of any representation or warranty or failure by the Subscriber to comply
        with any material covenant made by the Subscriber in this Subscription
        Agreement (including Schedule A and B attached hereto) or any other document
        furnished by the Subscriber to any of the foregoing in connection with
        this transaction.

	 	 	 
	4.2 	 Covenants of the Corporation: In connection
        with the issuance of Common Shares hereunder, the Corporation covenants
        and agrees with the Subscriber that:

	 	 	 
		(a) 	 it will duly file all such reports, statements or other
        documents as may be necessary or desirable, and otherwise use its best
        efforts to maintain in good standing, the Corporation’s status under
        the US Securities Act and the trading or quotation of its Common Shares
        on the over-the-counter market or another recognized exchange or facility;
        and

	 	 	 
		(b) 	 in the event the Subscriber sells or otherwise transfers
        any of the Common Shares outside the United States pursuant to Rule 903
        or Rule 904 of Regulation S under the US Securities Act or under another
        applicable exemption from registration under the U.S. Securities Act and
        in compliance with local laws and regulations, the Corporation agrees
        to issue one or more certificates representing the Common Shares to be
        sold if the Subscriber provides to the Corporation and its transfer agent
        the certificate or certificates for the Common Shares to be sold together
        with a declaration to the effect that the Common Shares have been sold
        or transferred pursuant to Rule 903 Rule 904 of Regulation S under the
        US Securities Act, or such other evidence of its reliance on an applicable
        exemption, as the Corporation or its transfer agent may reasonably require
        and such new certificates shall not bear the legend set forth in Section
        3.1(n) above if the Subscriber has held the Common Shares for a period
        of at least two years from the date the Subscriber made full payment for
        such Common Shares or otherwise provides to the Corporation and its transfer
        agent an opinion of counsel confirming that such legend may be removed.

ARTICLE 5 

  COMPLETION OF SUBSCRIPTION 

	5.1 	 Conditions Precedent in Favour of Subscriber:
        The obligations of the Subscriber to complete any Subscription Instalment
        and purchase the Common Shares subscribed for thereunder is subject to
        the satisfaction or waiver (in the discretion of the Subscriber) on or
        before the applicable Subscription Date of the following conditions:

	 	 	 
		(a) 	 the receipt of all required regulatory or other third
        party approvals;

	 	 	 
		(b) 	 the truth and accuracy of the representations and warranties
        of the Corporation herein as at the applicable Subscription Date;

6 

		(c) 	 the truth and accuracy of the representations and warranties
        of the Corporation in the Arrangement Agreement as at the Closing Date;

	 	 	 
		(d) 	 compliance by the Corporation with its covenants hereunder;

	 	 	 
		(e) 	 the completion of the transactions contemplated under
        the Arrangement Agreement and the Plan of Arrangement; and

	 	 	 
		(f) 	 the Corporation having completed one or more concurrent
        private placements and realized net proceeds of not less than $1,000,000
        at a price of $0.40 per Common Share.

	 	 	 
	5.2 	 Conditions Precedent in Favour of the Corporation:
        The obligations of the Corporation to issue and deliver the Common Shares
        subscribed for under any Subscription Instalment hereunder is subject
        to satisfaction or waiver (in the discretion of the Corporation) on or
        before the applicable Subscription Date of the following conditions:

	 	 	 
		(a) 	 the receipt of all required regulatory or other third
        party approvals;

	 	 	 
		(b) 	 the truth and accuracy of the representations and warranties
        of the Subscriber herein as at the applicable Subscription Date;

	 	 	 
		(c) 	 compliance by the Subscriber with its covenants hereunder;
        and

	 	 	 
		(d) 	 the completion of the transactions contemplated under
        the Arrangement Agreement and the Plan of Arrangement.

	 	 	 
	5.3 	 Closing of Subscription: The issuance
        of the Common Shares subscribed for under each Subscription Instalment
        will be completed on the applicable Subscription Date (or such earlier
        date or dates as the Subscriber may elect pursuant to Section 2.1). On
        each Subscription Date, the Subscriber will deliver to the Corporation
        a certified cheque, solicitors trust cheque or bank draft for that portion
        of the aggregate Subscription Price attributable to such Subscription
        Instalment and a certificate in respect of the satisfaction of the conditions
        precedent to such Subscription Instalment specified in Section 5.2(b)
        and (c), against delivery by the Corporation to the Subscriber of certificates
        representing the Common Shares subscribed for under such Subscription
        Instalment, registered in the name of the Subscriber or as the Subscriber
        may direct, and a certificate of an officer of the Corporation in respect
        of the satisfaction of the conditions precedent to such Subscription Instalment
        specified in Section 5.1(b), (c), (d) and (f).

	 	 	 
	5.4 	 Default in Payment. In the event the
        Subscriber is not required to or fails to pay any instalment of the Subscription
        Price as contemplated herein, the Corporation’s sole recourse is
        that provided for under the Escrow Agreement and the Subscriber shall
        have no further liability or obligation to the Corporation with respect
        to the payment of such instalment whether in debt or in damages (including
        loss of profit, opportunity, exemplary or punitive damages) or otherwise.

ARTICLE 6 

  GENERAL PROVISIONS 

	6.1 	 Costs: The Subscriber acknowledges and agrees
        that all costs incurred by the Subscriber (including any fees and disbursements
        of legal counsel retained by the Subscriber) relating to the subscription
        for the Common Shares by the Subscriber shall be borne by the Subscriber.

	 	 
	6.2 	 Further Assurances: Each of the parties hereto
        will from time to time execute and deliver all such further documents
        and instruments and do all acts and things as the other party may, either
        before or after the closing of the transactions contemplated hereby, reasonably
        require to effectively carry out or better evidence or perfect the full
        intent and meaning of this Subscription Agreement.

	 	 
	6.3 	 Time of the Essence: Time shall be of the essence
        of this Subscription Agreement.

7 

	6.4 	 Benefit of the Agreement: This Subscription Agreement
        will enure to the benefit of and be binding upon the respective heirs,
        executors, administrators, successors and permitted assigns of the parties
        hereto.

	 	 
	6.5 	 Entire Agreement: This Subscription Agreement,
        together with the Schedules hereto and the Escrow Agreement, constitutes
        the entire agreement between the parties hereto with respect to the subject
        matter hereof and supersedes and replaces any prior understandings and
        agreements between the parties with respect thereto. There are no representations,
        warranties, terms, conditions, undertakings or collateral agreements,
        expressed, implied or statutory, between the parties hereto other than
        as expressly set forth in this Subscription Agreement or in the Escrow
        Agreement.

	 	 
	6.6 	 Amendments and Waivers: No amendment to this
        Subscription Agreement will be valid or binding unless set forth in writing
        and duly executed by the parties hereto. No waiver of any breach of any
        provision of this Subscription Agreement will be effective or binding
        unless made in writing and signed by the party purporting to give the
        same and, unless otherwise provided, will be limited to the specific breach
        waived.

	 	 
	6.7 	 Assignment: The terms of this Subscription Agreement
        shall be binding upon and enure to the benefit of the Subscriber and the
        Corporation or their respective heirs, executors, administrators, successors
        and assigns, provided that this Subscription Agreement may be assigned
        by the Subscriber, without the prior written consent of the Corporation,
        provided the assignee provides to the Corporation, in writing, an agreement
        acknowledging and consenting to the terms and conditions hereof as if
        it were the Subscriber hereto, provided however, that notwithstanding
        such assignment, the Subscriber shall remain liable for any or all of
        the Subscription Price which such assignee is obliged to but fails to
        pay in connection with its assumption of the subscription hereunder.

	 	 
	6.8 	 Governing Law: This Subscription Agreement is
        governed by and shall be construed in accordance with the laws of the
        Province of British Columbia and the laws of Canada applicable therein.

	 	 
	6.9 	 Attornment: For the purpose of all legal proceedings
        this Subscription Agreement will be deemed to have been performed in British
        Columbia and the Courts of British Columbia will have jurisdiction to
        entertain any action arising under this Subscription Agreement. The parties
        hereto each hereby attorns to the jurisdiction of the Courts of British
        Columbia.

	 	 
	6.10 	 Facsimiled Subscription Agreement: The Corporation
        shall be entitled to rely on delivery by facsimile of an executed copy
        of this Subscription Agreement, and acceptance by the Corporation of such
        facsimile copy shall be legally effective to create a valid and binding
        agreement between the Subscriber and the Corporation in accordance with
        the terms hereof.

8 

SCHEDULE “A” 

CERTIFICATE OF ACCREDITED INVESTOR (BRITISH COLUMBIA) 

The Subscriber represents and Common Shares that the Subscriber
  is an “accredited investor” as that term is defined in NI 45-106 by
  virtue of the fact that the Subscriber satisfies one or more of the categories
  indicated below. 

PLEASE PLACE AN “X” FOR THE APPROPRIATE CATEGORY OR
  CATEGORIES BELOW: 

	[ ] 	(1) 	 a Canadian financial institution,
        or a Schedule III bank; 

	  	  	  

	[ ] 	(2) 	 the Business Development Bank
        of Canada incorporated under the Business Development Bank of 
        Canada Act (Canada); 

	  	  	  

	[ ] 	(3) 	 a subsidiary of any person referred
        to in paragraphs (a) or (b), if the person owns all of the voting securities
        of the subsidiary, except the voting securities required by law to be
        owned by directors of that subsidiary; 

	  	  	  

	[ ] 	(4) 	 a person registered under the
        securities legislation of a jurisdiction of Canada as an adviser or dealer,
        other than a person registered solely as a limited market dealer under
        one or both of the Securities Act (Ontario) or the Securities
        Act (Newfoundland and Labrador); 

	  	  	  

	[ ] 	(5) 	 an individual registered or formerly
        registered under the securities legislation of a jurisdiction of Canada
        as a representative of a person referred to in paragraph (d); 

	  	  	  

	[ ] 	(6) 	 the Government of Canada or a
        jurisdiction of Canada, or any crown corporation, agency or wholly-owned
        entity of the Government of Canada or a jurisdiction of Canada; 

	  
	[ ] 	(7) 	 a municipality, public board
        or commission in Canada and a metropolitan community, school board, the
        Comité de gestion de la taxe scolaire de l’île de Montréal
        or an intermunicipal management board in Québec; 

	  	  	  

	[ ] 	(8) 	 any national, federal, state,
        provincial, territorial or municipal government of or in any foreign jurisdiction,
        or any agency of that government; 

	  	  	
	[ ] 	(9) 	 a pension fund that is regulated
        by either the Office of the Superintendent of Financial Institutions (Canada)
        or a pension commission or similar regulatory authority of a jurisdiction
        of Canada; 

	  	  	  

	[ ] 	(10) 	 an individual who, either alone
        or with a spouse, beneficially owns, directly or indirectly, financial
        assets having an aggregate realizable value that before taxes, but net
        of any related liabilities, exceeds Cdn. $1,000,000; 

	  	  	
	[ ] 	(11) 	 an individual whose net income
        before taxes exceeded Cdn. $200,000 in each of the 2 most recent calendar
        years or whose net income before taxes combined with that of a spouse
        exceeded Cdn. $300,000 in each of the 2 most recent calendar years and
        who, in either case, reasonably expects to exceed that net income level
        in the current calendar year; 

	  	  	
	[ ] 	(12) 	 an individual who, either alone
        or with a spouse, has net assets of at least Cdn. $5,000,000; 

	  	  	  

	[ ] 	(13) 	 a person, other than an individual
        or investment fund, that has net assets of at least Cdn. $5,000,000 as
        shown on its most recently prepared financial statements; 

	  	  	  

	[ ] 	(14) 	 an investment fund that distributes
        or has distributed its securities only to 

A-1 

	[ ] 	  	(a) 	a person that is or was an accredited investor
      at the time of the distribution; 
	  	  	  	  

	[ ] 	  	(b) 	 a person that acquires or acquired
        securities in the circumstances referred to in sections 2.10 [Minimum
        amount investment], and 2.19 [Additional investment in investment
        funds] of NI 45-106; or 

	  	  	  	
	[ ] 	  	(c) 	 a person described in paragraph
        (i) or (ii) that acquires or acquired securities under section 2.18 [Investment
        fund reinvestment] of NI 45-106; 

	  	  	  	  
	[ ] 	(15) 	 an investment fund
        that distributes or has distributed securities under a prospectus in a
        jurisdiction of Canada for which the regulator or, in Québec, the
        securities regulatory authority, has issued a receipt;

	  	  	
	[ ] 	(16) 	 a trust company or
        trust corporation registered or authorized to carry on business under
        the Trust and Loan Companies Act (Canada) or under comparable
        legislation in a jurisdiction of Canada or a foreign jurisdiction, acting
        on behalf of a fully managed account managed by the trust company or trust
        corporation, as the case may be; 

	  	  	
	[ ] 	(17) 	a person acting on behalf of a fully
      managed account managed by that person, if that person 
	  	  	  	  
	[ ] 	  	(a) 	 is registered or authorized to
        carry on business as an adviser or the equivalent under the securities
        legislation of a jurisdiction of Canada or a foreign jurisdiction; and
      

	  	  	  	  

	[ ] 	  	(b) 	 in Ontario, is purchasing a security
        that is not a security of an investment fund; 

	  	  	  	  
	[ ] 	(18) 	 a registered charity
        under the Income Tax Act (Canada) that, in regard to the trade,
        has obtained advice from an eligibility adviser or an adviser registered
        under the securities legislation of the jurisdiction of the registered
        charity to give advice on the securities being traded; 

	  
	[ ] 	(19) 	 an entity organized
        in a foreign jurisdiction that is analogous to any of the entities referred
        to in paragraphs (a) to (d) or paragraph (i) in form and function; 

	  	  	
	[ ] 	(20) 	 a person in respect
        of which all of the owners of interests, direct, indirect or beneficial,
        except the voting securities required by law to be owned by directors,
        are persons that are accredited investors; 

	  	  	
	[ ] 	(21) 	 an investment fund
        that is advised by a person registered as an adviser or a person that
        is exempt from registration as an adviser; or 

	  	  	  
	  

	[ ] 	(22) 	 a person that is recognized
        or designated by the securities regulatory authority or, except in Ontario
        and Québec, the regulator as 

	  	  	
	[ ] 	  	(a) 	an accredited investor; or 
	  	  	  	  
	[ ] 	  	(b) 	an exempt purchaser in British Columbia after NI
      45-106 comes into force. 

Date: June ___, 2007 

WESLEY CLOVER CORPORATION 

	 By: 		 
	 	Name: Jose Medeiros 	 
	 	Title: President and Chief Operating Officer 	 

A-2 

For the purposes of this Schedule “A”, the following
  definitions apply: 

“bank” means a bank
  named in Schedule I or II of the Bank Act (Canada); 

“Canadian financial institution”
  means

	 	(a) 	 an association governed by the Cooperative Credit Associations
        Act (Canada) or a central cooperative credit society for which an order
        has been made under section 473(1) of that Act; or

	 	 	 
	 	(b) 	 a bank, loan corporation, trust company, trust corporation,
        insurance company, treasury branch, credit union, caisse populaire, financial
        services cooperative, or league that, in each case, is authorized by an
        enactment of Canada or a jurisdiction of Canada to carry on business in
        Canada or a jurisdiction of Canada;

“director” means (a)
  a member of the board of directors of a company or an individual who performs
  similar functions for a company, and (b) with respect to a person that is not
  a company, an individual who performs functions similar to those of a director
  of a company; 

“eligibility advisor”
  means 

	 	(a) 	 a person that is registered as an investment dealer
        or in an equivalent category of registration under the securities legislation
        of the jurisdiction of a purchaser and authorized to give advice with
        respect to the type of security being distributed;

	 	 	 
	 	(b) 	 in Saskatchewan or Manitoba, also means a lawyer who
        is a practicing member in good standing with a law society of a jurisdiction
        of Canada or a public accountant who is a member in good standing of an
        institute or association of chartered accountants, certified general accountants
        or certified management accountants in a jurisdiction of Canada provided
        that the lawyer or public accountant must not;

	 	 	 
	 	(c) 	 have a professional, business or personal relationship
        with the issuer, or any of its directors, executive officers, founders,
        or control persons; and

	 	 	 
	 	(d) 	 have acted for or been retained personally or otherwise
        as an employee, executive officer, director, associate or partner of a
        person that has acted for or been retained by the issuer or any of its
        directors, executive officers, founders or control persons within the
        previous 12 months;

“financial assets” means

	 	(a) 	 cash;

	 	 	 
	 	(b) 	 securities; or

	 	 	 
	 	(c) 	 a contract of insurance, a deposit or an evidence of
        a deposit that is not a security for the purposes of securities legislation;

“foreign jurisdiction”
  means a country other than Canada or a political subdivision of a country other
  than Canada; 

“fully managed account”
  means an account of a client for which a person makes the investment decisions
  if that person has full discretion to trade in securities for the account without
  requiring the client’s express consent to a transaction; 

A-3 

“investment fund” has
  the same meaning as in National Instrument 81-106 “Investment Fund Continuous
  Disclosure”; 

“jurisdiction” means
  a province or territory of Canada except when used in the term “foreign
  jurisdiction”; 

“person” includes (a)
  an individual, (b) a corporation, (c) a partnership, trust, fund and an association,
  syndicate, organization or other organized group of persons, whether incorporated
  or not, and (d) an individual or other person in that person’s capacity
  as a trustee, executor, administrator or personal or other legal representative;

“regulator” means 

	 	(a) 	 the Executive Director, as defined under section 1 of
        the Securities Act (British Columbia); and

	 	 	 
	 	(b) 	 such other person as is referred to in Appendix D of
        National Instrument 14-101 “Definitions”;

“related liabilities”
  means 

	 	(a) 	 liabilities incurred or assumed for the purpose of financing
        the acquisition or ownership of financial assets; or

	 	 	 
	 	(b) 	 liabilities that are secured by financial assets;

“Schedule III bank”
  means an authorized foreign bank named in Schedule III of the Bank Act (Canada);

“securities legislation”
  means 

	 	(a) 	 for British Columbia, the Securities Act (British
        Columbia) and the regulations, rules and forms under such Act and the
        blanket rulings and orders issued by the British Columbia Securities Commission;
        and

	 	 	 
	 	(b) 	 for other Canadian jurisdictions, such other statutes
        and instruments as are listed in Appendix B of National Instrument 14-101
        “Definitions”;

“securities regulatory authority”
  means 

	 	(a) 	 the British Columbia Securities Commission; and

	 	 	 
	 	(b) 	 in respect of any local jurisdiction other than British
        Columbia, means the securities commission or similar regulatory authority
        listed in Appendix C of National Instrument 14-101 “Definitions”;

“spouse” means, an individual
  who, 

	 	(a) 	 is married to another individual and is not living separate
        and apart within the meaning of the Divorce Act (Canada), from
        the other individual; or

	 	 	 
	 	(b) 	 is living with another individual in a marriage-like
        relationship, including a marriage-like relationship between individuals
        of the same gender;

“subsidiary” means an
  issuer that is controlled directly or indirectly by another issuer and includes
  a subsidiary of that subsidiary; 

A-4 

“voting security” means
  a security of an issuer that: 

	 	(a) 	 is not a debt security; and

	 	 	 
	 	(b) 	 carries a voting right either under all circumstances
        or under some circumstances that have occurred and are continuing;

An issuer is considered to be affiliated
  with another issuer if:

	 	(a) 	 one of them is the subsidiary of the other; or

	 	 	 
	 	(b) 	 each of them is controlled by the same person;

A person is considered to beneficially
  own securities that are beneficially owned by 

	 	(a) 	 an issuer controlled by that person; or

	 	 	 
	 	(b) 	 an affiliate of that person or an affiliate of an issuer
        controlled by that person;

A person (first person) is considered
  to control another person (second person) if: 

	 	(a) 	 the first person, directly or indirectly, beneficially
        owns or exercises control or direction over securities of the second person
        carrying votes which, if exercised, would entitle the first person to
        elect a majority of the directors of the second person, unless that first
        person holds the voting securities only to secure an obligation;

	 	 	 
	 	(b) 	 the second person is a partnership, other than a limited
        partnership, and the first person holds more than 50% of the interests
        of the partnership; or

	 	 	 
	 	(c) 	 the second person is a limited partnership and the general
        partner of the limited partnership is the first person.

Other terms which are used in this Schedule “A” and
  not otherwise defined and which are defined in the Securities Act (British
  Columbia), the regulations, rules and policy statements made thereunder, as
  amended, have the meanings defined in such legislation, regulations, rules and
  policy statements. 

A-5 

SCHEDULE “B” 

CERTIFICATE OF ACCREDITED INVESTOR (UNITED STATES) 

The Subscriber represents and Common Shares that he, she or it
  comes within the category or categories marked below, and that for any category
  marked, he, she or it has truthfully set forth, where applicable, the factual
  basis or reason the Subscriber comes within that category. The undersigned agrees
  to furnish any additional information which the Corporation deems necessary
  in order to verify the answers set forth below. All references to $ in this
  Schedule “B” certificate are to United States dollars. 

	Category A _____	 The undersigned is an individual
        (not a partnership, corporation, etc.) whose individual net worth, or
        joint net worth together with his or her spouse, presently exceeds USD
        $1,000,000. 

	  	
	  	 Explanation. In calculating net
        worth you may include equity in personal property and real estate, including
        your principal residence, cash, short term investments, stock and securities,
        provided that you deduct any debts you owe. Equity in personal property
        and real estate should be based on the fair market value of such property
        less debt secured by such property. 

	  	
	Category B _____	 The undersigned is an individual
        (not a partnership, corporation, etc.) who had an income in excess of
        USD $200,000 in each of the two most recent years, or joint income with
        his or her spouse in excess of USD $300,000 in each of those years (in
        each case including foreign income, tax exempt income and full amount
        of capital gains and losses but excluding any income of other family members
        and any unrealized capital appreciation) and has a reasonable expectation
        of reaching the same income level in the current year. 

	  	  

	Category C _____	 The undersigned is a director
        or executive officer of the Corporation. 

	  	  

	Category D _____	 The undersigned is a bank, as
        defined in Section 3(a)(2) of the US Securities Act; a savings and loan
        association or other institution as defined in Section 3(a)(5)(A) of the
        US Securities Act, whether acting in its individual or fiduciary capacity;
        any insurance company as defined in Section 2(a)(13) of the US Securities
        Act; any investment company registered under the Investment Company
        Act of 1940 or a business development company as defined in Section
        2(a)(48) of that US Securities Act; any Small Business Investment Company
        (“SBIC”) licensed by the U.S. Small Business Administration
        under Section 301(c) or (d) of the Small Business Investment
        Act of 1958; any plan established and maintained by a state, its
        political subdivisions, or any agency or instrumentality of a state or
        its political subdivisions, for the benefit of its employees, if such
        plan has total assets in excess of USD $5,000,000; any employee benefit
        plan within the meaning of the Employee Retirement Income Security
        Act of 1974 if the investment decision is made by a plan fiduciary,
        as defined in Section 3(21) of such act, which is either a bank, savings
        and loan association, insurance company, or registered investment advisor,
        or if the employee benefit plan has total assets in excess of USD $5,000,000
        or, if a self- directed plan, with investment decisions made solely by
        persons that are Accredited Investors (describe entity below). 

	  	

B-1 

	Category E 	 The undersigned is a private
        business development company as defined in section 202(a)(22) of the Investment
        Advisors Act of 1940. 

	  	
	Category F 	 The undersigned is either a corporation,
        partnership, Massachusetts or similar business trust, or non profit organization
        within the meaning of Section 501(c)(3) of the Internal Revenue Code,
        in each case not formed for the specific purpose of acquiring the Common
        Shares and with total assets in excess of USD $5,000,000. (describe entity
        below) 

	  	
	  	  

	Category G 	 The undersigned is a trust with
        total assets in excess of USD $5,000,000, not formed for the specific
        purpose of acquiring the Common Shares, where the purchase is directed
        by a “sophisticated person” as described in Rule 506(b)(2)(ii)
        under the US Securities Act. 

	  	
	Category H 	 The undersigned is an entity
        in which all of the equity owners are “accredited investors”
        within one or more of the above categories. If relying upon this Category
        alone, each equity owner must complete a separate copy of this Schedule
        B. (describe entity below) 

	  	
	  	 
      

	  	 
      

	  	  

	  	 The undersigned agrees that the
        undersigned will notify the Company at any time on or prior to the next
        applicable Subscription Date in the event that the representations and
        warranties in this Subscription Agreement shall cease to be true, accurate
        and complete. 

IN WITNESS WHEREOF, the undersigned has executed this confidential
  investor questionnaire as of the ____ day of June, 2007. 

	If a Corporation, Partnership or Other Entity: 	 	If an Individual: 
	  	 	  
	WESLEY CLOVER CORPORATION
    	 	  
	Name of Entity 	 	Signature 
	 	 	 
	Corporation
    	 	  
	Type of Entity 	 	Printed or Typed Name 
	  	 	  
	Signature of Person Signing 	 	Social Security or Taxpayer I.D. Number
    
	 	 	 
	Jose Medeiros 	 	  
	President and Chief
      Operating Officer 	 	  
	Printed or Typed Name and Title of Person Signing 	 	  

B-2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00125-of-00352.parquet"}]]