Document:

Exhibit 4.1

 

Fortis Inc.

 

Second Amended and Restated Dividend Reinvestment and Share Purchase Plan

 

As a holder of common shares (“Common Shares”) of Fortis Inc. (the “Company”), you should read this document carefully before making any decision regarding participation in the second amended and restated dividend reinvestment and share purchase plan of the Company (the “Plan”).  In addition, if you are a non-registered holder of Common Shares you should refer to Section 4.1.

 

Shareholders of the Company resident in the United States should review the prospectus relating to the Plan, including the United States federal income tax considerations and risk factors included therein and the documents incorporated by reference therein, which forms part of the Registration Statement on Form F-3 filed with the U.S. Securities and Exchange Commission on May 16, 2017.

 

1.                                      PURPOSE

 

The Plan provides a means for the Company’s Shareholders to invest Common Share cash dividends and Optional Cash Payments to purchase additional Common Shares.  Common Shares are purchased by the Plan Agent on behalf of the Participants under the Plan.  The Plan Agent purchases such shares, as determined from time to time by the Company, by written notice to the Plan Agent, either (i) on the open market through the facilities of the TSX and/or any other stock exchange on which the Common Shares may from time to time be listed and posted for trading or (ii) directly from the Company.  Therefore, the Plan also provides a means by which the Company may retain and reinvest cash dividends and increase its equity capital.

 

2.                                      DEFINITIONS

 

“2009 Plan” means the Company’s amended and restated dividend reinvestment and share purchase plan effective January 1, 2009, which plan is superseded by the Plan.

 

“Anti-Money Laundering Act” has the meaning set out in Section 5.2.

 

“Average Market Price” has the meaning set out in Section 5.5.

 

“Business Day” means any day on which the Plan Agent’s offices in the Province of Quebec, the TSX and each other stock exchange on which the Common Shares may from time to time be listed and posted for trading are generally open, but does not include a Saturday, Sunday, civic or statutory holiday in Toronto, Ontario or St. John’s, Newfoundland & Labrador.

 

“Common Shares” means common shares of the Company.

 

“Company” means Fortis Inc.

 

 

“CSPP” means the Company’s consumer share purchase plan, as amended from time to time, pursuant to which Shareholders resident in the provinces of Newfoundland & Labrador and  Prince Edward Island can elect to have their cash dividends on Common Shares automatically reinvested in the Company.

 

“Discount” has the meaning set out in Section 6.

 

“Dividend Payment Date” means the date chosen by the Board of Directors of the Company for the payment of a cash dividend on Common Shares.  This historically has been a Business Day in each of March, June, September and December of each year.

 

“Dividend Record Date” means the date chosen by the Board of Directors of the Company to determine those Shareholders entitled to receive payment of the dividend on Common Shares.

 

“ESPP” means the Company’s employee share purchase plan, as amended from time to time, pursuant to which employees of the Company and its subsidiaries are entitled to invest in Common Shares of the Company on a preferential basis.

 

“Intermediary” means a securities broker or dealer, bank, trust company, financial organization or any other nominee.

 

“Investment Date” means for the reinvestment of dividends and optional cash purchases under the Plan, the Dividend Payment Date.

 

“Market Purchase” has the meaning set out in Section 5.4.

 

“NYSE” means the New York Stock Exchange, or any successor stock exchange.

 

“Optional Cash Payment” has the meaning set out in Section 5.2.

 

“Participant” means a Shareholder holding at least the minimum number of Common Shares required pursuant to this Plan on the applicable Dividend Record Date who is:

 

(a)                                 a resident of Canada or the United States, or

 

(b)                                 resident outside Canada or the United States and is not prohibited under the law of the jurisdiction in which it resides from participating in the Plan,

 

and who is otherwise eligible to participate in the Plan and elects to do so by, (i) in the case of a registered Shareholder, completing and delivering the appropriate enrolment forms to the Plan Agent or by enrolling online through the Plan Agent’s self-service web portal at www.investorcentre.com/fortisinc or, (ii) in the case of a beneficial Shareholder, having an Intermediary enroll on his, her or its behalf, as more particularly described in the Plan.

 

“Plan” means the Company’s Second Amended and Restated Dividend Reinvestment and Share Purchase Plan.

 

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“Plan Agent” means Computershare Trust Company of Canada, or such other firm as may be designated by the Company from time to time to act as agent under the Plan.

 

“Plan Shares” means Common Shares registered in the name of a Participant under the Plan.

 

“Shareholder” means a registered owner of Common Shares or a non-registered beneficial owner of Common Shares, as the context requires.

 

“Trading Day” means a day on which a board lot of the Common Shares was traded on the relevant stock exchange.

 

“Treasury Purchase” has the meaning set out in Section 5.4.

 

“TSX” means the Toronto Stock Exchange, or any successor stock exchange.

 

“VWAP” means the volume weighted average trading price of the Common Shares, calculated by dividing the total value of Common Shares by the total number of Common Shares traded for the relevant period.

 

3.                                      USE OF PROCEEDS

 

The net proceeds to the Company from the sale of Common Shares under the Plan will be added to the Company’s general funds and used for general corporate purposes or any other purpose in the sole discretion of the Company.

 

4.                                      PARTICIPATION IN THE PLAN

 

4.1                               General

 

Provisions of the Plan apply to all Participants, but are subject to the administrative practices and requirements of Intermediaries through whom Plan Shares are held by non-registered Shareholders.  The administrative practices and requirements of Intermediaries vary and, accordingly, the various dates by which actions must be taken under the Plan and the documentary requirements set out in the Plan may not be the same for non-registered Shareholders as for registered Shareholders.  Some Intermediaries may require non-registered Shareholders to become registered Shareholders in order to participate in the Plan.  In addition, there may be a fee charged by some Intermediaries for a non-registered Shareholder to become a registered Shareholder, which will not be covered by the Company.  Non-registered Shareholders should therefore contact their Intermediary to determine the requirements of such Intermediary regarding participation in the Plan.

 

4.2                               Eligibility

 

Common Shares are offered for sale under the Plan in both Canada and the United States.  Every registered Shareholder who is a resident of Canada or the United States is eligible to participate in the Plan.  The distribution of Common Shares under the Plan in the United States is registered under the U.S. Securities Act of 1933, as amended.

 

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Shareholders that are resident in jurisdictions other than Canada or the United States can also participate in the Plan, subject to any restrictions under the laws of such Shareholder’s jurisdiction of residence and provided such laws do not subject the Company or the Plan to any additional legal, regulatory, filing or registration requirements. Cash dividends to be reinvested for Participants resident outside of Canada will be reduced by the amount of any applicable withholding taxes, as determined in the sole discretion of the Company. Neither the Company nor Plan Agent will have any duty to inquire to the residency status of the Shareholder, nor will the Company or Plan Agent be required to know the residency status of a Shareholder, other than as notified by a Shareholder. Notwithstanding the foregoing, as part of the enrolment process, the Company or Plan Agent may request additional information or confirmations, including an opinion of legal counsel, from such non-Canadian resident Shareholders to ensure that enrolment is not prohibited by the law of the country in which they reside.

 

4.3                               Enrolment — Registered Shareholders

 

Registered Shareholders may enrol their Common Shares in the Plan by completing the Reinvestment Enrolment - Participant Declaration Form approved by the Company and the Plan Agent from time to time and mailing such form to the Plan Agent or by enrolling online through the Plan Agent’s self-service web portal.

 

4.4                               Enrolment — Non-Registered Beneficial Shareholders

 

Beneficial Shareholders whose Common Shares are not registered in their own name but instead are held through an Intermediary, may only participate in the Plan if they:

 

(a)                                 transfer their Common Shares into their own name and enroll directly in the Plan as a registered Shareholder; or

 

(b)                                 arrange for their Intermediary to enroll in the Plan on their behalf.

 

The Intermediary will be responsible for causing separate instructions to be delivered to the Agent regarding the extent of its participation in the Plan on behalf of non-registered Shareholders.

 

4.5                               Date of Enrolment

 

An eligible Shareholder will become a Participant and the Common Shares designated by the Participant will be recorded by the Plan Agent for participation in the Plan effective as of the first Dividend Record Date following receipt by the Plan Agent of the duly completed Reinvestment Enrolment — Participant Declaration Form and, if making an initial Optional Cash Payment, an Optional Cash Purchase — Participant Declaration Form. If an enrolment form is received pursuant to this Section 4.5 at least three Business Days prior to a Dividend Record Date, the enrolment in the Plan will be effective for such Dividend Record Date.  Any enrolment received less than three Business Days prior to a Dividend Record Date will not be effective until after such Dividend Payment Date. A non-registered Shareholder will become a Participant when an Intermediary has enrolled in the Plan on its behalf through a registered Shareholder.

 

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4.6                               Transfer of Common Shares

 

Participants in the Company’s CSPP or ESPP, or other share purchase plans of the Company from time to time, may transfer the Common Shares registered in their name pursuant  to such plans to the Plan by providing notice to the Plan Agent of their desire to withdraw Common Shares from their existing plan and to transfer the Common Shares currently held under such plan to the Plan.  The Participant must also complete a Reinvestment Enrolment - Participant Declaration Form and mail both documents together to the Plan Agent or complete such process through the Plan Agent’s self-service web portal.  Where notice of termination and enrolment is received pursuant to this Section 4.6 at least three Business Days prior to a Dividend Record Date the termination and enrolment in the Plan will be effective for such Dividend Record Date.  Any requests received less than three Business Days prior to a Dividend Record Date will not be completed until after such Dividend Payment Date.

 

4.7                               Other Restrictions

 

The Company may, in its sole discretion, determine from time to time that any Shareholder or group of Shareholders may not participate or continue to participate in the Plan.  Without limitation, the Company may deny the right to participate in the Plan to any Shareholder if the Company has reason to believe that such Shareholder has been engaged in market activities, or has been artificially accumulating securities of the Company for the purpose of taking undue advantage of the Plan to the detriment to the Company.

 

The Company reserves the right to deny participation in the Plan, and to not accept enrolment from, any person or agent of such person who appears to be, or who the Company has reason to believe is, subject to the laws of any jurisdiction that does not permit participation in the Plan in the manner sought by or on behalf of such person. Shareholders should be aware that certain Intermediaries may not allow participation in the Plan and the Company is not responsible for monitoring or advising which Intermediaries allow participation.

 

4.8                               Ongoing Enrolment.

 

Once a Participant has enrolled in the Plan, participation continues automatically unless terminated in accordance with the Plan.

 

4.9                               Deemed Confirmations.

 

By enrolling in the Plan, whether directly as a registered Shareholder or indirectly as a non-registered Shareholder through an Intermediary, a Participant is deemed to have:

 

(a)                                 represented and warranted to the Company and the Plan Agent that they are eligible to participate in the Plan;

 

(b)                                 appointed the Plan Agent to receive from the Company, and directed the Company to credit to the Plan Agent, all dividends (less any applicable withholding taxes) payable in respect of all Common Shares registered in the name of the Shareholder and enrolled in the Plan or held under the Plan for its

 

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account, or, in the case of a non-registered Shareholder enrolled indirectly through an Intermediary, that is enrolled on its behalf in the Plan;

 

(c)                                  authorized and directed the Plan Agent to reinvest on behalf of the Participant such dividends (less any applicable withholding taxes) in Common Shares, all in  accordance with the provisions of the Plan as set forth herein and otherwise upon and subject to the terms and conditions of the Plan; and

 

(d)                                 acknowledged and agreed to the limitations on liability as set out in Section 16 of the Plan.

 

5.                                      PURCHASE OF COMMON SHARES UNDER THE PLAN

 

5.1                               Dividend Reinvestment

 

Subject to Section 19, all dividends payable on Plan Shares recorded for participation in the Plan, including Plan Shares acquired and retained under the Plan, will be paid by the Company to the Plan Agent and will, after the deduction of any withholding tax applicable to Participants residing outside of Canada, be used by the Plan Agent to purchase Common Shares for the Participant’s account on the Dividend Payment Date.  Subject to Section 4.1, full reinvestment of all dividends received under the Plan (less any applicable withholding taxes) is possible as whole and fractional Common Shares (computed to six decimal places) are credited to Participants’ accounts. The rounding of any fractional interest is determined by the Plan Agent in its sole discretion.

 

5.2                               Optional Cash Payments

 

Participants may choose to make optional cash purchases of Plan Shares under the Plan (each, an “Optional Cash Payment”) provided that Optional Cash Payments made by any Participant shall not be (i) less than C$100 per transaction nor greater than C$30,000 per calendar year, if made in Canadian dollars, or (ii) less than US$100 per transaction nor greater than US$30,000 per calendar year, if made in U.S. dollars.  An Optional Cash Payment may be made by using the Optional Cash Purchase - Participant Declaration Form, together with (a) a Canadian dollar cheque or (b) a U.S. dollar cheque and an Agent Mandatary Certification Form, as applicable, to make the optional cash purchase. Alternatively, participants may enroll to make an Optional Cash Payment and to effect such payment by pre-authorized debit by using the Plan Agent’s self-service web portal.

 

Optional Cash Payments will be used by the Plan Agent to purchase Plan Shares on the first Dividend Payment Date following enrolment and receipt of cleared funds, provided that enrolment is completed and cleared funds are received not less than three Business Days before a Dividend Payment Date.  Enrolment forms and cleared funds received less than three Business Days before a Dividend Payment Date will be used to purchase Plan Shares on the Dividend Payment Date after the next following Dividend Payment Date.  All Optional Cash Payments made in U.S. dollars to the Plan Agent will be converted into Canadian dollars by the Plan Agent on the Dividend Payment Date based on the exchange rate in effect at the time of conversion.

 

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There is no obligation to make Optional Cash Payments, to continue to make Optional Cash Payments or to make all such payments in the same amount.  No interest will be paid to Participants on any funds held for investment or distribution under the Plan.  The Discount will not apply to purchases made pursuant to Optional Cash Payments. The full amount of any Optional Cash Payment will be invested in Plan Shares, as whole and fractional Common Shares (computed  to six decimal places) purchased with such funds will be credited to such Participant’s account. The rounding of any fractional interest is determined by the Plan Agent in its sole discretion.

 

The Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and the regulations made thereunder (the “Anti-Money Laundering Act”) requires that the Plan Agent collect and record specific information and take other compliance measures with respect to new or existing Participants who elect to make an Optional Cash Payment under the Plan. In order to participate in the Optional Cash Payment feature of the Plan, Participants must have met the applicable requirements under the Anti-Money Laundering Act, which are contained in each of the Reinvestment Enrolment — Participant Declaration Form and the Optional Cash Purchase — Participant Declaration Form.

 

5.3                               Pre-Authorized Debit

 

To be eligible to participate in the Plan through pre-authorized debit, a Participant must already be enrolled in the Plan, must use a bank account with a Canadian financial institution, and such account must be coded compliant with relevant Anti-Money Laundering Act requirements. Participants have the option of a one-time or recurring pre-authorized debit for any Optional Cash Payment. Both options can be initiated online through the Plan Agent’s self-service web portal. Instructions must be received at least ten Business Days before the Dividend Payment Date. If a Participant authorizes an Optional Cash Payment through pre-authorized debit then its bank account will be debited on the fifth Business Day prior to the Dividend Payment Date.

 

5.4                               Source of Plan Shares

 

The Plan Shares acquired by the Plan Agent pursuant to the Plan will be, at the Company’s discretion, either newly issued Common Shares purchased from the Company (a “Treasury Purchase”) or Common Shares purchased on the open market through the facilities of the TSX and/or any other stock exchange on which the Common Shares may from time to time be listed and posted for trading (a “Market Purchase”). For Market Purchases, the Common Shares will be purchased starting one Business Day after the Dividend Payment Date and ending three Business Days after the Dividend Payment Date.

 

5.5                               Price of Plan Shares — Reinvestment of Dividends

 

The purchase price for Plan Shares under the Plan on any Dividend Payment Date from the reinvestment of cash dividends will be:

 

(a)                                 in the case of a Market Purchase, the average of the actual price paid (excluding brokerage commissions, fees and transaction costs) per Common Share by the Plan Agent; or

 

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(b)                                 in the case of a Treasury Purchase, the price will be the VWAP on the TSX (or another stock exchange where the majority of the trading volume and value of the Common Shares occurs) on the five Trading Days immediately preceding the Dividend Payment Date (the “Average Market Price”) less a Discount, if any, of up to 5% at the Company’s election.

 

5.6                               Price of Plan Shares — Optional Cash Payment

 

The purchase price for Plan Shares under the Plan on any Dividend Payment Date acquired from Optional Cash Payments (after converting any Optional Cash Payments made in U.S. dollars into Canadian dollars based on the exchange rate in effect at the time of conversion) will be:

 

(a)                                 in the case of a Market Purchase, the average of the actual price paid (excluding brokerage commission, fees and transaction costs) per Common Share by the Plan Agent; or

 

(b)                                 in the case of a Treasury Purchase, the Average Market Price.

 

6.                                      APPROVAL OF DISCOUNT

 

The Board of Directors of the Company may from time to time approve a discount (the “Discount”) of up to 5% on the Average Market Price of Common Shares issued pursuant to a Treasury Purchase under Section 5.5(b).  The Board of Directors may alter or eliminate the Discount at any time in its sole discretion.  If the Discount is altered or eliminated by the Board of Directors of the Company, the Company shall publish a press release notifying Participants of such change.

 

The Discount applicable to Treasury Purchases pursuant to Section 5.5(b) is 2% as of May 3, 2017, the effective date of the Plan.  The Discount will not apply to purchases made pursuant to Optional Cash Payments.

 

7.                                      COSTS

 

All administrative costs of the Plan, including any brokerage commissions, fees or other expenses of the Plan Agent incurred for the purchase of Plan Shares for Participants are borne by the Company.  Participants who enroll through an Intermediary may be subject to costs and charges by their Intermediary.

 

8.                                      TRANSITION TO THE PLAN

 

For continuity of treatment in respect of their dividends and Optional Cash Payments, participants in the 2009 Plan will automatically be enrolled in the Plan on May 3, 2017 and become Participants in the Plan, unless such Participants forward notice to the Plan Agent exiting from the Plan.  The Plan accounts of Participants will contain the Common Shares, including fractional shares computed to six decimal places, if any, held by such Participant prior to May 3, 2017.  Cash dividends on the Common Shares in the accounts of such Participants

 

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under the 2009 Plan will automatically be reinvested in the purchase of Plan Shares pursuant to the Plan.

 

9.                                      ADMINISTRATION

 

9.1                               The Plan Agent

 

The Company has appointed Computershare Trust Company of Canada as Plan Agent to administer the Plan on behalf of the Company and the Participants pursuant to an agreement  between the Company and the Plan Agent. The Company may, from time to time, at its sole discretion appoint a replacement Plan Agent. If any replacement Plan Agent is appointed, notice of such replacement will be provided to Participants by the Company.

 

The Plan Agent is required to comply with applicable laws, orders or regulations of any governmental authority which impose on the Plan Agent a duty to take or refrain from taking any action under the Plan and to permit any properly authorized person to have access to and to examine and make copies of any records relating to the Plan.

 

9.2                               Registration of Plan Shares

 

Plan accounts shall be maintained in the names in which certificates were registered or enrolment forms submitted at the time the Participant enrolled in the Plan. Consequently, share certificates or registration of holdings of uncertificated Common Shares for whole Plan Shares withdrawn from the Plan will be registered in exactly the same manner.

 

9.3                               Statement of Account

 

The Plan Agent will maintain a dividend reinvestment and share purchase account for each registered Shareholder Participant. A statement of account will be mailed to each registered Shareholder Participant by the Plan Agent as soon as practical after each Dividend Payment Date. Each such statement will indicate changes to the account over the relevant period including:

 

(a)                                 the dividends received by the Plan Agent in respect of Plan Shares recorded in the account and, if applicable, any tax withheld on dividends received by the Plan Agent in respect of such Plan Shares;

 

(b)                                 the amount of any Optional Cash Payments received by the Plan Agent from such Participant; and

 

(c)                                  the number of additional Plan Shares acquired for the account, including any fractional Plan Share entitlement credited to the Participant computed to six decimal places.

 

Participants have the option of receiving the Statement of Account electronically through the Plan Agent’s self-service web portal.

 

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Non-registered Shareholder Participants will receive statements of account from their Intermediary in accordance with the Intermediary’s administrative practices.  Non-registered Shareholder Participants should contact their Intermediary to determine the procedures for requesting statements.

 

9.4                               Certificates or other evidence of shareholding

 

Share certificates will not be issued to a Participant unless specifically requested.  This convenience protects against loss, theft or destruction and reduces administrative costs.  Certificates or a statement of holdings of uncertificated Common Shares for whole Plan Shares purchased with reinvested dividends and Optional Cash Payments will be provided upon request  to the Plan Agent from the Participant pursuant to Section 10 or automatically upon termination of participation in the Plan pursuant to Section 11.  Certificates will be issued or, if applicable, registration of holdings of uncertificated Common Shares will be made, in the name of the Participant. Certificates will not be issued or, if applicable, registration of holdings of uncertificated Common Shares will not be made, in respect of any fraction of a Plan Share.

 

10.                               DISPOSITION OR WITHDRAWAL OF PLAN SHARES

 

10.1                        Withdrawal of Plan Shares

 

A Participant who is not terminating participation in the Plan may, upon written request to the Plan Agent, withdraw whole Plan Shares from the Plan.  Alternatively, a Participant may follow the instructions for withdrawal on the Plan Agent’s self-service web portal. Upon receipt of a withdrawal request, the Plan Agent will withdraw the specified number of whole Plan Shares from the Participant’s account and deliver a share certificate or a statement of holdings of uncertificated Common Shares representing such shares in the Participant’s name. No share certificate or statement of holdings of uncertificated Common Shares will be issued for a fraction of a Common Share. A share certificate or statement of holdings of uncertificated Common Shares will generally be delivered within three weeks of receipt by the Plan Agent of a Participant’s request to withdraw Plan Shares. A beneficial Shareholder Participant who holds Plan Shares indirectly through an Intermediary, should contact its Intermediary where it requires a Common Share certificate.

 

10.2                        Sale of Plan Shares

 

Participants may request the Plan Agent sell any number of whole Plan Shares on their behalf.  Such request may be made to the Plan Agent either in writing, by phoning the Plan Agent’s toll-free number and requesting a sale, or by following the instructions on the Plan Agent’s self-service web portal.  Upon receipt of such a request, the Plan Agent will, as soon as practicable, arrange for the sale of such Plan Shares through a registered broker-dealer selected by the Plan Agent from time to time.  The proceeds of such sale, less brokerage commissions, administrative fees and applicable taxes, if any, which are payable by the Participant in connection with such sale, will be paid to the Participant by the Plan Agent in Canadian dollars unless such Participant is a non-resident of Canada. In the case of sale requests by non-residents of Canada, the Plan Agent will sell the relevant Plan Shares on the open market through the facilities of the NYSE and pay such proceeds in U.S. dollars to such Participant.  Broker

 

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commissions charged on such sales will be charged at the customary rates charged from time to time by the relevant broker. Plan Shares that are to be sold for a Participant may be commingled with Plan Shares of other Participants requesting a sale of Plan Shares in which case the proceeds to each Participant will be based on the average sale prices and the average brokerage commissions, administrative fee and applicable taxes of all Plan Shares so commingled.

 

10.3                        No Pledge

 

Plan Shares held by the Plan Agent may not be pledged, hypothecated, assigned or otherwise disposed of or transferred.  Participants who wish to pledge, hypothecate, assign, dispose of or otherwise transfer their Plan Shares held by the Plan Agent, must first withdraw such shares under the Plan.

 

10.4                        Remaining Plan Shares

 

If a Participant sells or withdraws less than all of their Plan Shares, dividends paid on their remaining Plan Shares will continue to be reinvested in Common Shares under the Plan.

 

11.                               TERMINATION OF PARTICIPATION

 

11.1                        Termination by Participant

 

Participants may terminate their participation in the Plan by completing the termination portion of the voucher on the reverse of their quarterly statement of account and sending it to the Plan Agent at any time.  Alternatively, a Participant may follow the instructions for termination on the Plan Agent’s self-service web portal. Where notice of termination is received at least three Business Days prior to a Dividend Record Date the termination will be effective for such Dividend Record Date.  Any termination request received less than three Business Days before a Dividend Record Date will become effective after the next following Dividend Payment Date.

 

The Plan Agent will settle a terminating Participant’s account by issuing a share certificate for the number of whole Plan Shares held in such Participant’s account, or a statement of holdings of uncertificated Common Shares, and making a cash payment to such Participant for any fraction of a Plan Share remaining.  The amount of the payment for any such fraction will be based on the prevailing market price of the Common Shares at the time of termination.  Any Optional Cash Payment received prior to termination of participation but not invested in Common Shares will be returned to the Participant upon such termination.

 

Non-registered Shareholders should consult with their Intermediary to arrange for the termination of their participation in the Plan.

 

11.2                        Death of a Participant

 

Participation in the Plan will be terminated upon receipt by the Plan Agent of appropriate evidence of the death of a Participant from such Participant’s duly appointed legal representative and written instructions to terminate.  Proof of the legal representative’s authority to act must accompany the evidence of death.  The Plan Agent will terminate and settle the account for such deceased Participant in the manner provided for in Section 11.1.

 

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11.3                        Termination by the Company

 

The Company reserves the right to terminate a Participant’s participation in the Plan at any time if there is less than one Common Share recorded in the Participant’s account or the Participant cannot be contacted at the addresses given by the Participant.

 

12.                               VOTING RIGHTS

 

Participants may vote whole Plan Shares held by the Plan Agent on their behalf, in the same manner as any other Common Shares of the Company either by proxy or in person.  The Plan Agent will forward to Participants, as soon as practicable following receipt, any proxy solicitation materials.  Plan Shares held by the Plan Agent representing fractional interests in Common Shares  and any Plan Shares in respect of which voting instructions are not received by the Plan Agent will not be voted.

 

Non-registered Shareholder Participants should contact their Intermediary to determine the procedures for voting their Common Shares.

 

13.                               PARTICIPATION BY INSIDERS AND EMPLOYEES

 

Insiders and employees of the Company may elect to participate in the Plan, provided however such persons may only submit an enrolment form and may only vary or terminate their participation in the Plan when they are not subject to a blackout period or otherwise not permitted to trade under the Company’s Insider Trading Policy.

 

14.                               RIGHTS OFFERING

 

If the Company offers rights to its Shareholders then rights certificates or a statement of holdings of uncertificated rights will be issued to Participants in respect of whole Plan Shares on the record date of the rights issue.  Any fractional entitlement to a right that would accrue to a Participant will be rounded down to the nearest whole number. A non-registered Shareholder Participant who holds Common Shares indirectly through an Intermediary should contact its Intermediary to determine how such rights will be distributed to it.

 

15.                               STOCK DIVIDENDS, STOCK SPLITS AND CONSOLIDATIONS

 

Any Common Shares distributed pursuant to a stock dividend or a stock split on Plan Shares will be retained by the Plan Agent and credited, net of any applicable withholding or non-resident taxes, to the accounts of the Participants in accordance with their respective entitlements under the Plan. In the event of a consolidation of the Common Shares, the number of Common Shares credited to a registered Shareholder Participant’s account will be adjusted to account for the effect of such consolidation of the Common Shares. A certificate for Common Shares or a statement of holdings of uncertificated Common Shares resulting from a Common Share dividend or share split or a replacement certificate or revised statement of holdings of uncertificated Common Shares as a result of a consolidation of Common Shares will be delivered to the Participant in the same manner as to holders of Common Shares who are not participating in the Plan.

 

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16.                               RESPONSIBILITIES OF THE COMPANY AND THE PLAN AGENT

 

Neither the Company nor the Plan Agent shall be liable under the Plan, except in the case of wilful misconduct, for any act or for any omission to act, in connection with the operation of the Plan including, without limitation, any claims of liability:

 

(a)                                 with respect to any failure by an Intermediary to enroll or not enroll in the Plan any Shareholder (or, as applicable, any Common Shares held on such Shareholder’s behalf) in accordance with the Shareholder’s instructions or to not otherwise act upon a Shareholder’s instructions;

 

(b)                                 with respect to the continued enrolment in the Plan of any Shareholder (or, as applicable, any Common Shares held on such Shareholder’s behalf) until receipt of all necessary documentation as provided herein required to terminate participation in the Plan;

 

(c)                                  arising out of failure to terminate a Participant’s account upon such Participant’s death prior to receipt of notice in writing of such death;

 

(d)                                 with respect to the prices at which Plan Shares are purchased or sold for the Participant’s account and the times such purchases or sales are made or with respect to the stock exchange or other market on which such purchases or sales are effected;

 

(e)                                  with respect to any decision to amend, suspend, replace or terminate the Plan in accordance with the terms hereof;

 

(f)                                   with respect to any determination made by the Company or the Plan Agent regarding a Shareholder’s eligibility to participate in the Plan or any component thereof, including the cancellation of a Shareholder’s participation for failure to satisfy eligibility requirements;

 

(g)                                  any decision not to accept an Optional Cash Payment for the purchase of Plan Shares;

 

(h)                                 any failure by the Plan Agent to purchase Common Shares with an Optional Cash Payment;

 

(i)                                     with respect to any taxes or other liabilities payable by a Shareholder in connection with its Common Shares or its participation in the Plan;

 

(j)                                    actions taken as a result of inaccurate and incomplete information or instructions; or

 

(k)                                 as a result of any currency conversion performed by the Plan Agent,

 

and each Participant expressly disclaims any recourse in respect thereof. In no event shall the Company be liable for consequential, special, indirect, incidental, punitive or exemplary

 

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damages, costs, expenses, or losses (including, without limitation, lost profits and opportunity costs). For purposes of this section, the term the Company shall include its associated and affiliated entities and their respective partners, directors, officers and employees. The provisions of this section shall apply regardless of the form of action, damage, claim, liability, cost, expense, or loss, whether in contract, statute, tort (including, without limitation, negligence) or otherwise.

 

17.                               RISK OF MARKET PRICE FLUCTUATIONS

 

Participants should recognize that Plan Shares acquired under the Plan are no different from an investment in Common Shares that are held directly.  Accordingly, neither the Company nor the Plan Agent can assure a profit or protect Participants against a loss on the Plan Shares purchased under the Plan.  Shareholders wishing to enroll in the Plan should carefully consider the  risk factors set out in the Company’s Annual Information Form, Management’s Discussion and Analysis and other public disclosure documents available under the Company’s profile on SEDAR at www.sedar.com and on EDGAR at www.sec.gov prior to enrolling.

 

18.                               AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN

 

The Company reserves the right to amend, suspend or terminate the Plan at any time, but any such action shall not have retroactive effect that would prejudice the interests of the Participants.  All Participants will be sent written notice of any such amendment, suspension or termination and such notice shall also be published by press release.  In the event of termination of the Plan by the Company, the Plan Agent will terminate and settle the account for each Participant in the manner provided for in Section 11.1.  In the event of suspension of the Plan by the Company, no investment will be made by the Plan Agent on the Investment Date immediately following the effective date of such suspension.  Optional Cash Payments which are not invested as of the effective date of such suspension and Common Share dividends which are subject to the Plan and which are paid after the effective date of such suspension will be remitted by the Plan Agent to the Participants to whom these are due (without interest or deduction thereon except applicable withholding taxes, if any).

 

Amendments to the Plan will require the prior approval of the TSX and, to the extent applicable, any other stock exchange on which the Common Shares may from time to time be listed and posted for trading, which approval(s) will be obtained before the amendment is implemented.

 

19.                               LIMIT ON REINVESTMENTS IN CERTAIN EVENTS

 

The number of Common Shares issuable under the Plan is subject to certain limits adopted by the Company pursuant to applicable securities laws and the rules of the stock exchanges on which the Common Shares may from time to time be listed and posted for trading. If issuing Common Shares under the Plan would result in the Company exceeding the limit and the Company determines not to issue Common Shares in respect of a particular Dividend Payment Date, Participants will receive from the Plan Agent cash dividends for the dividends that are not reinvested in Common Shares (without interest or deduction thereon, except for any applicable withholding taxes). The Company will be under no obligation to issue Common

 

14

 

Shares to Participants under the Plan where the Company exceeds the maximum number of Common Shares that may be issued under the Plan. The Company will be under no obligation to issue Common Shares on a pro rata basis to Participants under the Plan where the Company exceeds the maximum number of Common Shares that may be issued under the Plan. The Company is not required to facilitate market purchases of Common Shares for any dividends not reinvested due to a limit on the number of Common Shares issuable under the Plan.

 

20.                               CURRENCY

 

All monetary amounts identified in the Plan as “C$” are stated in Canadian dollars.  All monetary amounts identified in the Plan as “US$” are stated in U.S. dollars.

 

21.                               GOVERNING LAW

 

The Plan will be governed and construed in accordance with the laws of the Province of Newfoundland & Labrador and the federal laws of Canada applicable therein.

 

22.                               ADOPTION OF RULES AND REGULATIONS

 

The Company and the Plan Agent may also from time to time adopt and implement rules and regulations to facilitate the administration of the Plan. The Company reserves the right to regulate and interpret the Plan as it deems necessary or desirable to ensure the efficient and equitable operation of the Plan.

 

23.                               NOTICES AND CORRESPONDENCE

 

All notices required to be given to Participants under the Plan shall be mailed to the Participants at the addresses shown on the records of the Plan Agent.  Participants must notify the Plan Agent promptly in writing of any change of address.

 

Notices to the Plan Agent shall be sent to:

 

Fortis Inc. Dividend Reinvestment and Share Purchase Plan 
 c/o Computershare Trust Company of Canada 
 100 University Avenue, 8th Floor 
 Toronto, ON M5J 2Y1 
 Telephone:                                   1-866-586-7638 
 Facsimile:                                         1-888-453-0330

 

Web:  www.investorcentre.com/fortisinc

 

24.                               EFFECTIVE DATE

 

The Plan is effective as of May 3, 2017. The first Investment Date under the Plan is June 1, 2017.

 

15ex10-1.htm

Exhibit 10.1

 

 

 

 

 

 

 

 

 

April 28, 2017

 

 

 

 

SOFTWARE LICENCE AGREEMENT

 

  

 

 

between

 

FINGER MOTION COMPANY LIMITED 

 

(as "Licensor")

 

 

 

and

 

 

 

PROPERTY MANAGEMENT CORPORATION OF AMERICA

 

(as “Licensee")

 

 

 

 

 

 

   

TABLE OF CONTENTS

 

	
1.
	
DEFINITIONS AND INTERPRETATION 
	
 1

	
2.
	
LICENSE GRANTED
	
3

	
3.
	
Protection of INTELLECTUAL PROPERTY RIGHTS     
	
 4

	
4.
	
LICENSEE's OBLIGATIONS
	
 4

	
5.
	
FEES
	
 6

	
6.
	
warranties 
	
 6

	
7.
	
TERMINATION and default
	
 7

	
8.
	
FORCE MAJEURE
	
7

	
9.
	
COSTS
	
 8

	
10.
	
CONFIDENTIALITY
	
 8

	11.	GOVERNING LAW AND DISPUTE RESOLUTION	8
	12.	NOTICES	9
	13.	MISCELLANEOUS	9

	
SCHEDULE I: DETAILS OF INTELLECTUAL PROPERTY RIGHTS
	
12

	
SCHEDULE II: LICENCE FEES
	
13

 

 

 

 

 

 

SOFTWARE LICENCE AGREEMENT

 

THIS SOFTWARE LICENCE AGREEMENT (this "Agreement") is made on April 28, 2017: 

 

BETWEEN:

 

	
(1)
	
FINGER MOTION COMPANY LIMITED, a private limited company incorporated under the laws of Hong Kong ("Licensor"); and

 

	
(2)
	
PROPERTY MANAGEMENT CORPORATION OF AMERICA, a corporation organised and existing under the laws of Delaware ("Licensee").

 

(The Licensor and the Licensee shall be individually referred to as a "Party" and collectively referred to as the "Parties", as the context may require). 

 

WHEREAS:

 

	
A.
	
The Licensor owns certain software related to several computer games, more specifically described in Schedule I (the “Intellectual Property Rights”, in particular the computer software programs and applications, owned by the Licensor shall hereinafter be referred to as the "Technology").

 

	
B.
	
The Licensor has agreed to license to the Licensee the relevant Intellectual Property Rights in respect of the Technology to enable the Licensee to conduct the Business in the Territory on the terms and conditions set out below.

 

NOW IT IS HEREBY AGREED as follows:

 

	
1.
	
DEFINITIONS AND INTERPRETATION

 

	
1.1
	
In this Agreement, the following terms, to the extent not inconsistent with the context thereof, shall have the meanings assigned to them herein below:

 

"Affiliate" means with respect to any Person, any other Person that, directly or indirectly, through one or more intermediaries, Controls or is Controlled by or is under common Control with the first Person, and shall include a relative of such Person;

 

"Business" means the deployment, utilisation, marketing and sale of the Technology and all associated activities thereto;

 

"Business Day" shall mean a day other than a Saturday or Sunday or public holiday and on which commercial banks are open for business in Hong Kong;

 

"Control" shall mean the power to direct the management or policies of any Person, whether through the ownership of over fifty per cent. (50%) of the voting power of such Person, through the power to appoint, remove or control the appointment or removal of more than half of the Board of Directors or similar governing body of such entity, through contractual arrangements, voting trust, dominant influence or otherwise. The expressions "Change of Control", "Controlling", "Controlled", and "Controller", shall be construed accordingly;

 

"Intellectual Property Rights" means all rights in and in relation to all intellectual property rights subsisting in the products, services, etc., developed, being developed or proposed to be developed, by or on behalf of or in the course of employment or engagement with, the Licensor, and includes all patents, utility models, inventions, copyrights, moral rights, trade names, brand names, business names and internet domain names, rights in get-up and trade dress, trademarks and service marks, goodwill and the right to sue for passing off or unfair competition, designs, computer software, source codes, algorithm, financial models, database, data, work product, concept, discovery, technology, confidential information and trade secrets, and all other intellectual property rights, in each case whether registered or unregistered, and including all versions, modifications, enhancements and derivative works thereof, applications and rights to apply for and be granted, renewals or extensions of, and rights to claim priority from, and all related, similar or equivalent rights or forms of protection which subsist or will subsist now or in the future in any part of the world, and includes the Intellectual Property Rights listed in Schedule I, the Know-how and any Improvements;

 

 

 

1

 

 

"Know-how" means the technical data and knowledge of the Licensor which is necessary to enable the Licensee to conduct the Business. The term Know-how includes inventions and formulations whether patented, unpatented or unpatentable, recorded and unrecorded discoveries, secret processes, secret formulas, published and unpublished technical information of any kind which is necessary or desirable to enable the Licensee to conduct the Business;

 

"Law" or "Laws" shall mean and include all applicable statutes, enactments, acts of legislature or the Parliament, laws, ordinances, rules, by-laws, regulations, notifications, guidelines, policies, directions, directives and orders of any governmental authority, tribunal, board, court or recognised stock exchange;

 

"Patents" means only those patents and patent applications listed in Schedule I (as updated from time to time in accordance with this Agreement) and associated Intellectual Property Rights;

 

"Person" means any individual, corporation, company, partnership, firm, voluntary association, joint venture, trust, unincorporated organisation, governmental authority or any other entity whether acting in an individual, fiduciary or other capacity;

 

"Technology" has the meaning set out in Recital A; 

 

"Territories" means worldwide, and "Territory" shall be construed accordingly;

 

"Trademarks" means only those trademarks and trademark applications listed in Schedule I (as updated from time to time in accordance with this Agreement) and associated Intellectual Property Rights;

 

"US$" or "US Dollars" means United States dollars, the lawful currency of the United States of America;

 

"Warranties" means the representations and warranties in Clause 6.

 

	
1.2
	
In this Agreement, unless the context otherwise requires:

 

	 	
(a)
	
Words denoting any gender shall be deemed to include all other genders;

 

	 	
(b)
	
Words importing the singular shall include the plural and vice versa, where the context so requires;

 

 

 

2

 

 

	 	
(c)
	
The terms "hereof", "herein", "hereby", "hereto" and other derivatives or similar words, refer to this entire Agreement or specified Clauses of this Agreement, as the case may be;

 

	 	
(d)
	
Reference to the term "Clause" or "Schedule" shall be a reference to the specified Clause or Schedule of this Agreement; 

 

	 	
(e)
	
Any reference to "writing" includes printing, typing, lithography and other means of reproducing words in a permanent visible form.

 

	 	
(f)
	
The term "directly or indirectly" means directly or indirectly through one or more intermediary persons or through contractual or other legal arrangements, and "direct or indirect" shall have correlative meanings;

 

	 	
(g)
	
All headings and sub-headings of Clauses and Schedules, and use of bold typeface are for convenience only and shall not affect the construction or interpretation of any provision of this Agreement; 

 

	 	
(h)
	
Reference to any legislation or Law or to any provision thereof shall include references to any such Law as it may, after the date of this Agreement, from time to time, be amended, supplemented or re-enacted, and any reference to statutory provision shall include any subordinate legislation made from time to time under that provision; 

 

	 	
(i)
	
Reference to the word "include" or "including" shall be construed without limitation;

 

	 	
(j)
	
The Schedules hereto shall constitute an integral part of this Agreement; 

 

	 	
(k)
	
Terms defined in this agreement shall include their correlative terms;

 

	 	
(l)
	
Time is of the essence in the performance of the Parties’ respective obligations. If any time period specified herein is extended, such extended time shall also be of essence;

 

	 	
(m)
	
References to the knowledge, information, belief or awareness of any Person shall be deemed to include the knowledge, information, belief or awareness of such Person after examining all information and making all due diligence inquiries and investigations which would be expected or required from a Person of ordinary prudence; 

 

	 	
(n)
	
The Parties acknowledge that they and their respective counsel have read and understood the terms of this Agreement and have participated equally in the negotiation and drafting. Accordingly, no court or arbitrator construing this Agreement shall construe it more stringently against one Party than against the other;

 

	 	
(o)
	
All references to this Agreement shall be deemed to include any amendments or modifications to this Agreement from time to time;

 

	 	
(p)
	
Any word or phrase defined in the recitals or in the body of this Agreement as opposed to being defined in Clause 1.1 shall have the meaning so assigned to it, unless the contrary is expressly stated or the contrary clearly appears from the context; and

 

	 	
(q)
	
If any provision in Clause 1.1 is a substantive provision conferring rights or imposing obligations on any Party, effect shall be given to it as if it were a substantive provision in the body of this Agreement.

 

	
2.
	
LICENSE GRANTED

 

	
2.1
	
The Licensor hereby grants to the Licensee as the sole and exclusive licensee the rights to deploy, utilise, market and sell the Technology in the Territories for a period of ten (10) years from the date of this Agreement, with a further option to extend for two (2) consecutive terms of five (5) years each (collectively, the "Term"). 

 

 

 

3

 

 

	
2.2
	
The Licensor shall promptly disclose to the Licensee all relevant details of the Technology, as well as provide all necessary technical and other support to the Licensee, to conduct the Business.

 

	
2.3
	
If at any time during the term of this Agreement the Licensor shall make improvements to the Technology or parts thereof (collectively, the "Improvements"), the Licensor shall promptly notify and provide the relevant details to the Licensee, and shall automatically grant to the Licensee a license to use the Improvements on the same terms and conditions as contained in this Agreement, and Schedule I shall be updated accordingly.

 

	
2.4
	
The Licensee may sublicense the Technology to any Affiliate or authorised agent to conduct the Business.

 

	
2.5
	
For the avoidance of doubt, the exclusive rights granted pursuant to this Clause 2 shall be on condition that the Party receiving the license rights (including any sublicensee) shall be bound by the confidentiality provisions of this Agreement and shall not to directly or indirectly compete with, canvass, solicit, circumvent or otherwise cause a material reduction in the business of the Licensor. This undertaking is considered fair and reasonable by the Parties. If any such undertaking is found to be unenforceable, but would be valid if any part of it were deleted or the period or area of application reduced, the undertaking shall apply with such modifications as may be necessary to make it valid and enforceable.

 

	
3.
	
Protection of INTELLECTUAL PROPERTY RIGHTS

 

	
3.1
	
The Licensor shall take all necessary measures to defend or prosecute, as the case may be, any and all claims, infringements or causes of action arising from any attempt by any other person, firm or corporation to use any of the Intellectual Property Rights and to at all times protect the Intellectual Property Rights, and keep the Licensee promptly informed of all circumstances coming to the attention of the Licensor which the Licensor ought reasonably to know may constitute an infringement of any of the Intellectual Property Rights.

 

	
3.2
	
In the event that the Licensor fails to promptly undertake the defence or prosecution (as the case may be) of any litigation made against the Intellectual Property Rights, the Licensee shall, without prejudice to any other rights it has, hereby be authorised by the Licensor to undertake the defence or prosecution (as the case may be) on its behalf and the Licensor shall make available to the Licensee all information and particulars in its possession and cooperate to the fullest extent with the Licensee to assist the Licensee in such defence or prosecution (as the case may be).

 

	
3.3
	
Any damage or monies recovered from third parties in any action or proceedings regarding the Intellectual Property Rights shall belong to the Licensor after reimbursing the Licensee for any reasonable expenses incurred in assisting the Licensor in such action or proceedings.

 

	
4.
	
LICENSEE's OBLIGATIONS

 

	
4.1
	
Marketing and support obligations: The Licensee shall use best efforts to promote and market the Technology at its own cost in order to maximize the licensing and distribution of the Technology. Such marketing efforts shall include, without limitation: establishment of a marketing and sales team dedicated exclusively to promoting and distributing the Technology, advertising the Technology in a commercially appropriate and reasonable manner, and promoting the Technology at seminars, trade shows and conferences. The Licensee agrees further that its marketing and advertising efforts with respect to the Technology will be of the highest quality, and shall preserve the professional image and reputation of the Licensor and the Technology.

 

 

 

4

 

 

	
4.2
	
Preparation of localised versions:

 

	 	
(a)
	
Website preparation and maintenance: The Licensee shall be responsible for the creation, localization, updating and maintenance of websites used to market and sell the Technology.

 

	 	
(b)
	
Preparation of localized versions: The Licensee shall be responsible for preparing localized versions of the Technology and of any new version thereof in accordance with a schedule to be agreed upon for each such new version.

 

	 	
(c)
	
Responsibility for quality assurance: The Licensee shall have exclusive responsibility for the development, packaging and quality assurance of the localized versions of the Technology.

 

	
4.3
	
Installation, training, technical support and maintenance:

 

	 	
(a)
	
Installation and training: The Licensee shall be responsible for conducting all activities required to install the Technology at retailers and suppliers and for providing training to the retailers and suppliers. The Licensee shall also conduct the training related activities for such retailers and suppliers, at such retailers and suppliers' request, and charge a reasonable fee to such retailers and suppliers for such training. All such installation and training shall be conducted with the highest level of professionalism and quality.

 

	 	
(b)
	
Technical support and maintenance: The Licensee shall be responsible for providing technical support with respect to technical questions, support problems, and error evaluation and correction to all retailers and suppliers of the Technology who have entered into a software maintenance agreement with the Licensee.

 

	 	
(c)
	
Software maintenance and support services: Software maintenance and support services shall be provided under the Licensee's software maintenance and support services policies in effect on the date the software maintenance and support services is ordered. The Licensee is hereby authorized to distribute any and all error corrections and updates to all of its retailers, suppliers, customers and sub-licensees.

 

	
4.4
	
Restrictive covenants: 

 

	 	
(a)
	
The Licensee acknowledges that the Technology contains the valuable information of the Licensor and the Licensee agrees not to cause or permit the modification, reverse engineering, translation, disassembly, or decompilation of, or otherwise to attempt to derive the source code of the Technology, whether in whole or in part.

 

	 	
(b)
	
In order to protect the Licensor's Intellectual Property Rights in the Technology, the Licensee agrees that as a condition of its rights hereunder, each copy of the Technology and related documentation reproduced by or on behalf of the Licensee shall contain the proprietary notices stating ownership of the Intellectual Property Rights belongs to the Licensor, whether on the media, within the code and on the documentation which appear on the media or within the code of the Technology or on the related documentation.

 

	
4.5
	
The Licensee hereby acknowledges that:-

 

	 	
(a)
	
the Licensor is the sole owner of the Intellectual Property Rights (including any localised versions of the Technology); and

 

 

 

5

 

 

	 	
(b)
	
no title to the Intellectual Property Rights will pass hereunder to or through the Licensee, and only the rights expressly granted in or pursuant to this Agreement are provided to the Licensee.

 

	
4.6
	
The Licensee shall not do anything which the Licensee ought reasonably to know may adversely affect the goodwill associated with the Licensor and the Intellectual Property Rights without first consulting with the Licensor. For the avoidance of doubt, the Licensee shall not claim or register the Intellectual Property Rights in any jurisdiction without prior written consent of the Licensor.

 

	
4.7
	
The Licensee will promptly notify the Licensor of all circumstances coming to the attention of the Licensee which the Licensee ought reasonably to know may constitute an infringement of any of the Intellectual Property Rights, including any claim, demand or suit based upon or arising from the use of, or of any attempt by any other person, firm or corporation to use, any of the Intellectual Property Rights, and shall take such reasonable action in connection therewith as the Licensor may direct to assist the Licensor in the protection of the Intellectual Property Rights. The Licensee will also promptly notify the Licensor in writing of any litigation relating to this Agreement or the Licensee's operations hereunder instituted by the Licensee or by any person, firm, corporation or governmental agency against the Licensee.

 

	
4.8
	
The Licensee shall, where applicable, provide all necessary assistance to the Licensor in maintaining and obtaining the registrations of the Intellectual Property Rights under the name of the Licensor.

 

	
5.
	
FEES

 

In consideration of the license granted and information and services provided by the Licensor to the Licensee under Clause 2 of this Agreement, the Licensee shall pay such license fee in such manner and on such terms set out in Schedule II hereto. 

 

	
6.
	
warranties

 

	
6.1
	
Each Party hereby represents and warrants to the other Party that:

 

	 	
(a)
	
In respect of Parties which are not natural Persons, it is a company duly incorporated and validly existing under the laws of its jurisdiction of incorporation;

 

	 	
(b)
	
It has taken all necessary corporate action to authorise entry into and performance of this Agreement and to carry out the transactions contemplated by this Agreement;

 

	 	
(c)
	
Its obligations under this Agreement constitute valid and binding obligations, enforceable in accordance with their respective terms;

 

	 	
(d)
	
It is not insolvent or bankrupt or unable to pay its debts within the meaning of any applicable law and is not subject to any insolvency, bankruptcy, winding-up, dissolution, administration or re-organisation, appointment of a receiver, administrator, administrative receiver, judicial manager, trustee or analogous proceedings under the laws of any applicable jurisdiction.

 

	 	
(e)
	
It has at all times conducted its business in accordance with all applicable laws and regulations.

 

	
6.2
	
In addition, the Licensee represents and warrants to the Licensor that the Licensee maintains the facilities, resources and experienced personnel necessary to conduct the Business and to perform the necessary installation, training and maintenance services related to such Technology and otherwise to fulfill its obligations under this Agreement.

 

 

 

6

 

 

	
6.3
	
Each Party acknowledges that the other Party is entering into this Agreement on the basis of, and in reliance on, the Warranties, and undertakes to notify the other Party if it is aware of any circumstances reasonably likely to result in a breach of any Warranties. The Warranties are deemed to be repeated on each day throughout the duration of this Agreement.

 

	
6.4
	
Each Party hereby undertakes as principal obligor to indemnify and hold harmless the other Party and its directors, shareholders, subsidiaries, employees, agents, affiliates, advisers, successors and assigns (collectively, the "Indemnified Parties") against any and all losses, liabilities, damages, claims, demands, costs, expenses (or actions or investigations in respect thereof) (together the "Claims") resulting from, arising out of or relation to:

 

	 	
(a)
	
any breach of any term of this Agreement (including the Warranties) or of applicable laws and regulations by the first mentioned Party; or

 

	 	
(b)
	
any infringement, misappropriation or claims (howsoever arising) challenging the validity, enforceability, effectiveness or ownership of the Intellectual Property Rights; or

 

	 	
(c)
	
any action reasonably required to be taken by the Indemnified Parties in connection with and/or to remedy any of the above.

 

	
7.
	
TERMINATION and default

 

	
7.1
	
This Agreement becomes effective as of the date first above written ("Effective Date") and shall continue in force until the earlier of (a) the expiration of 10 years from the Effective Date (or if renewed pursuant to the option in Clause 2.1, the expiration of the extension term), or (b) if terminated earlier pursuant to the terms of this Agreement, Provided That nothing herein shall prejudice any Claims or accrued rights of either Party hereto.

 

	
7.2
	
Upon the failure of either Party hereto to fulfill any of its obligations under this Agreement, the Party aggrieved by such default may give to the other Party written notice of such default, such notice to refer specifically to the aggrieved Party's intention to terminate this Agreement in the event of continued default, and, (a) in relation to a breach of any term (other than a Warranty), if after 14 days from the date of such notice the defaulting Party has failed or refused to remedy such default, if capable of being remedied, or (b) has failed or refused to pay compensation satisfactory to the aggrieved Party in the case of a breach of a Warranty or of a default not capable of being remedied, this Agreement may be terminated forthwith by notice duly given to the defaulting Party, and such termination shall be without prejudice to any other rights or claims the aggrieved Party may have against the defaulting Party.

 

	
7.3
	
If this Agreement is terminated or expired at any time, the Licensee shall continue to have the license and right for a period of 30 days from the date of termination of this Agreement to complete deliveries in relation to the Business which have been entered into prior to the date of termination or expiry (as the case may be) of this Agreement, after which all rights granted to the Licensee under this Agreement shall cease and the Licensee shall refrain from utilising the Intellectual Property Rights. The Licensee shall either return to the Licensor or destroy all copies and records of the technical information and documentation relating to the Intellectual Property Rights in the custody or control of the Licensee.

 

	
8.
	
FORCE MAJEURE

 

	
8.1
	
In the event that any Party hereto shall be rendered unable to carry out the whole or any part of its obligations under this Agreement for any reason beyond the control of that Party, including but not limited to decrees or restraints by governmental authorities, acts of God, force majeure, strikes, war, riot and any other causes of such nature, then the performance of the obligations hereunder of that Party or all the Parties hereto as the case may be and as they are affected by such cause shall be excused during the continuance of any inability so caused, but such inability shall as far as possible be remedied with all reasonable despatch.

 

 

 

7

 

 

	
9.
	
COSTS

 

	
9.1
	
The costs and expenses, including stamp duty, goods and services tax, duties and other taxes, and all costs and expenses incurred in the preparation and execution of this Agreement (including legal fees and disbursements) incurred in the preparation and execution of this Agreement and to the giving effect of the terms hereof shall be borne by the Licensee. 

 

	
10.
	
CONFIDENTIALITY

 

	
10.1
	
Each Party shall keep all information relating to each other Party, information relating to the transactions herein and this Agreement (collectively referred to as the "Information") confidential. None of the Parties shall issue any public release or public announcement or otherwise make any disclosure concerning the Information without the prior approval of the other Party; provided however that nothing in this Agreement shall restrict any of the Parties from disclosing any information as may be required under applicable Law subject to providing a prior written notice of ten (10) Business Days to the other Parties. Subject to applicable Law, such prior notice shall also include (a) details of the Information intended to be disclosed along with the text of the disclosure language, if applicable; and (b) the disclosing Party shall also cooperate with the other Parties to the extent that such other Party may seek to limit such disclosure including taking all reasonable steps to resist or avoid the applicable requirement, at the request of the other Parties.

 

	
10.2
	
Nothing in this Clause 10 shall restrict any Party from disclosing Information for the following purposes:

 

	 	
(a)
	
To the extent that such Information is in the public domain other than by breach of this Agreement;

 

	 	
(b)
	
To the extent that such Information is required to be disclosed to any Governmental Authority to whose jurisdiction such Party is subject or with whose instructions it is customary to comply;

 

	 	
(c)
	
Insofar as such disclosure is reasonably necessary to such Party’s employees, directors or professional advisers, provided that such Party shall procure that such employees, directors or professional advisors treat such Information as confidential. For the avoidance of doubt it is clarified that disclosure of information to such employees, directors or professional advisors shall be permitted on a strictly "need-to-know basis".

 

	
11.
	
GOVERNING LAW AND DISPUTE RESOLUTION

 

	
11.1
	
This Agreement shall be governed by, and construed in accordance with, the Laws of the State Delaware, United States of America. 

 

	
11.2
	
Any and all disputes, controversies or conflicts arising from or in relation to this Agreement, including disputes on its validity, conclusion, binding effect, breach, amendment, expiration and termination (collectively, "Disputes"), shall, as far as possible, be settled amicably by the Parties. 

 

	
11.3
	
If any such Dispute is not settled amicably within thirty (30) days as from the date any Party informs the other Party that any Dispute has arisen, the Parties agree that such Dispute shall be referred to and finally resolved by arbitration in the United States in accordance with the Rules of the American Arbitration Association ("AAA Rules" and "AAA" respectively), which rules are deemed to be incorporated by reference in this Clause 11. However, to the extent that the AAA Rules are in conflict with the provisions of this Clause 11, the provisions of this Clause 11 shall prevail. The tribunal shall consist of one (1) arbitrator, to be appointed by the President of the AAA. The language of the arbitration shall be English.

 

 

 

8

 

 

	
12.
	
NOTICES

 

	
12.1
	
Notices, demands or other communication required or permitted to be given or made under this Agreement shall be in writing and delivered personally or sent by prepaid post with recorded delivery, or email addressed to the intended recipient at its address set forth below, or to such other address or email number as a Party may from time to time duly notify to the others:

  

	 	To the Licensor:	FINGER MOTION COMPANY LIMITED
	 	 	Unit A, 19/F, Times Media Centre, 133 Wan Chai 
	 	 	Road, Wan Chai, Hong Kong HKSAR 
	 	 	 
	 	
To the Licensee:
	
PROPERTY MANAGEMENT CORPORATION  

	 	 	OF AMERICA
	 	 	Unit A, 19/F, Times Media Centre, 133 Wan Chai 
	 	 	Road, Wan Chai, Hong Kong HKSAR 

 

	
12.2
	
Any such notice, demand or communication shall, unless the contrary is proved, be deemed to have been duly served at the time of delivery in the case of service by delivery in person or by post, and on transmission in the case of service by email, provided that such notice, demand or communication shall also be dispatched by post within one (1) Business Day of transmission of such notice, demand or communication by email.

 

	
13.
	
MISCELLANEOUS 

 

	
13.1
	
Each of the rights of the Parties under this Agreement are independent, cumulative and without prejudice to all other rights available to them, and the exercise or non-exercise of any such rights shall not prejudice or constitute a waiver of any other right of a Party, whether under this Agreement or otherwise.

 

	
13.2
	
No waiver of any breach of any provision of this Agreement shall constitute a waiver of any prior, concurrent or subsequent breach of the same or any other provisions hereof, and no waiver shall be effective unless made in writing and signed by an authorised representative of the waiving Party.

 

	
13.3
	
Each and every obligation under this Agreement shall be treated as a separate obligation and shall be severally enforceable as such in the event of any obligation or obligations being or becoming unenforceable in whole or in part. To the extent that any provision or provisions of this Agreement are unenforceable they shall be deemed to be deleted from this Agreement and any such deletion shall not affect the enforceability of the remainder of this Agreement not so deleted provided the fundamental terms of this Agreement are not altered.

 

	
13.4
	
No amendment or variation of this Agreement shall be binding on any Party unless such variation is in writing and duly signed by all the Parties.

 

	
13.5
	
Subject to the provisions of this Agreement, this Agreement is personal to each Party to this Agreement and shall not be capable of assignment without the prior written consent of the other Party.

 

	
13.6
	
This Agreement constitutes the whole agreement between the Parties relating to the subject matter hereof and supersedes any prior arrangements whether oral or written, relating to such subject matter. No Party has relied upon any representation or warranty in entering this Agreement other than those expressly contained herein. 

 

 

 

9

 

 

	
13.7
	
The Parties hereto shall execute and do and, take such steps as may be in their power to, procure that all other necessary persons, if any, execute and do all such further documents, agreements, deeds, acts and things as may be required so that full effect may be given to the provisions of this Agreement, including, without limitation, making an application (where applicable) to the relevant patent or other intellectual property registry for registration of the grant of license under a registered patent or other intellectual property.

 

	
13.8
	
This Agreement may be executed in any number of originals or counterparts, each in the like form and all of which when taken together shall constitute one and the same document, and any Party may execute this Agreement by signing any one or more of such originals or counterparts. 

 

 

 

10

 

  

EXECUTION PAGE

 

 

 

IN WITNESS WHEREOF, the Parties have entered into this Agreement the day and year first above written.

 

LICENSOR

 

	
SIGNED for and on behalf of  
	
)             .......................................

	
FINGER MOTION COMPANY LIMITED
	
)             Director

	
 
	
)

	
 
	
)

	
Witness:
	
)

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
LICENSEE
	
 

	 	 
	SIGNED for and on behalf of 	)             .......................................
	PROPERTY MANAGEMENT CORPORATION	)             Name
	OF AMERICA	)             Director
	 	)
	Witness:	)
	 	 

                  
      

 

 

11

 

 

SCHEDULE I: DETAILS OF INTELLECTUAL PROPERTY RIGHTS

 

 

 

	 	
1.
	
Trademarks:

 

 

 

 

 

	 	
2.
	
Patents:

 

 

12

 

  

SCHEDULE II: LICENCE FEES

 

 

Licence Maintenance Costs: The Licensee shall cover all operations costs associated with supporting the Technology.

 

Tax grossing up: If the Licensor is required by law to make any deduction or withholding on account of any value added tax, income tax or any other taxes or duties from any sum paid or payable by the Licensee to the Licensor under this Agreement, the final sum payable by the Licensee shall be increased to the extent necessary to take into account the applicable withholding, deduction or payment to enable the Licensor to make the necessary remittance to the relevant governmental authority.

 

Fee: Licensee shall issue an aggregate of 100,000 shares of its Series A Preferred Stock stock to the Licensor promptly following the date hereof. Such shares shall be issued to the principals of Licensor, or their assigns, at the direction thereof.

 

 

 

 

13

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