Document:

f8k0909ex10v_universalhold.htm

Exhibit 10.5

 

	Employment Agreement 	  September 14, 2009

                                                                                   

Agreement dated September 14, 2009 by and between Universal Holdings, Inc a Delaware Corporation, and Jeffrey A Beunier (the “Executive”).

WHEREAS, the Company recognizes that the Executive's talents and abilities are unique, and are integral to the success of Universal Holdings, Inc and thus wishes to secure the ongoing services of the Executive on the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth below, the parties hereby agree as follows:

 

	
1.  
	
Employment: The Company hereby agrees to employ the Executive as the Chief Executive Officer of the Company, and the Executive hereby accepts such employment, on the terms and conditions set forth below.

	
2.  
	
Start Date: The Executive’s start date will be on or around September 14, 2009.

	
3.  
	
Compensation and Related Matters:

	
a.  
	
Base Salary. During the Employment Period, the Company shall pay the Executive a base salary at the rate of not less than $200,000 per year (“Base Salary”).  The Executive’s base Salary shall be paid in approximately equal installments every two (2) weeks.  If the Executive’s Base Salary is increased by the Company,
such increased Base Salary shall then constitute the Base Salary for all purposes of this agreement.

	
b.  
	
Stock Compensation: Five Percent (5%) of the current outstanding and authorized shares of Universal Holdings Inc. The restricted stock grant will vest over a three year period quarterly, vesting the trailing calendar quarter at its end.  There will be an initial vesting of 20% of the stock grant upon execution of this agreement.

	
c.  
	
Over Riding Royalty Interests: One Percent (1%) overriding royalty interest (‘ORRI’) on all acquired leases, wells, and properties (sourced by the Executive and board approved) will be assigned to the Executive or an entity chosen by the Executive upon the acquisition and/or development of the leases, wells or properties.  The Company
will assign the ORRI free and clear of any liens and interests and the Company will no longer have any economic or legal interests in the assigned ORRI (‘s).

 

	
d.  
	

Co-Investment: The Executive or an affiliate of the Executive will have an option to co-invest (with Board Approval) in any and all of the company projects on a well by well and lease by lease basis at cost.  The election to co-invest must be made within ninety (90) days upon the completion of a well or acquisition of a lease, well, or property
and will date to the effective date of the completion of the well or acquisition of a lease well or property.  The Executive will be limited in acquiring a maximum of ten (10%) of any asset.

 

	
e.  
	

Annual Bonus: For each full fiscal year of the Company that begins and ends during the Employment Period, and for the portion of the fiscal year of the Company that begins in 2009 ("Fiscal Year 2009"), the Executive shall be eligible to earn an annual cash bonus in such amount as shall be determined by the Compensation Committee of the Board (the "Compensation
Committee") (the "Annual Bonus") based on the achievement by the Company of performance goals established by the Compensation Committee for each such fiscal year (or portion of Fiscal Year 2009), which may include targets related to the earnings before interest, taxes, depreciation and amortization ("EBITDA"), hydrocarbon production level, hydrocarbon reserve amounts of the Company; provided, that the Annual Bonus shall be targeted no less than $100,000 (with board approval). The Compensation Committee shall
establish objective criteria to be used to determine the extent to which performance goals have been satisfied.

 

	
f.  
	

Vacation: The Executive shall be entitled to four (4) weeks of vacation per year. Vacation not taken during the applicable fiscal year (but not in excess of three weeks) shall be carried over to the next following
fiscal year.

 

	
g.  
	

Expenses: The Company will reimburse the Executive for all expenses related to Company business, including, but not limited to travel, marketing, communication, due diligence, legal fees and expenses, etc.

 

 

 

 

 

	
4.  
	
Dedication of Time/Conflict of Interests:  During the Employment Period, the Executive shall serve as the Chief Executive Officer
of the Company, with such duties, authority and responsibilities as are normally associated with and appropriate for such a position. The Executive shall report directly to the Board.

 

The Company acknowledges the Executive is not exclusively employed by the Company and the Company acknowledges the Executive is currently active in a number of activities related to the energy industry and will remain active in activities not associated with the company.  These
activities may or may not be in conflict with the best interests of the Company.  The Company specifically acknowledges the Executive is permitted to continue allocating time to business activities outside of the Company and waives any and all conflicts of interest(s) that may or may not exist or develop in the future. 

 

The Executive acknowledges the Company is dependent upon his knowledge and skill set and will dedicate a minimum of ten (10) hours per week to the Company’s business.

 

	
5.  
	
Responsibilities: As the CEO of Universal Holdings, Inc, you will be responsible for developing and implementing the Company’s business plan, locate and review prospective acquisition targets, negotiate any and all required contracts and agreements, oversee the development
plan of all acquired properties, execute any and all documents required to implement the Company’s business plan, and legally bind the Company to any agreement or contract.  As such, you will have the authority to reject or modify any acquisition or development plan.

	
6.  
	
At-Will Employment: The Executive’s employment with the Company would be on an at-will basis.  If terminated for any reason other than Cause, the Company will be responsible to provide the Executive a minimum of one 90 days  Base Salary as severance
payable immediately upon termination as well as any business expenses incurred but not yet reimbursed.  Furthermore, the Company will release any and all claims to any stock, ORRI or other compensation provided through the date of termination or to which the Executive is entitled at the date of termination.  The provisions of Section 9 will continue in full force for a minimum period of Five (5) years after termination.  Cause is to be defined as Gross Negligence, Fraud, or Gross
Misconduct.

	
7.  
	
Location: You will be based in Denver, Colorado.  During the Employment Period, the Company shall provide the Executive with an office if the need arises.  Upon mutual agreement
of the Executive and the Company, offices maybe relocated to a different location.

	
8.  
	
Representations and Warranties: Company represents and warrants to Executive that this Agreement has been duly authorized, executed and delivered by Company and, assuming the due execution by Executive, constitutes a legal, valid and binding agreement of Company, enforceable
against Company in accordance with its terms.

	
9.  
	
Indemnity:  The Company agrees that if the Executive is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "Proceeding"),
by reason of the fact that the Executive is or was a trustee, director or officer of the Company or any predecessor to the Company or any of their affiliates or is or was serving at the request of the Company, any predecessor to the Company or any of their affiliates as a trustee, director, officer, member, employee or agent of another corporation or a partnership, joint venture, limited liability company, trust or other enterprise, including, without limitation, service with respect to employee benefit plans,
whether or not the basis of such Proceeding is alleged action in an official capacity as a trustee, director, officer, member, employee or agent while serving as a trustee, director, officer, member, employee or agent, the Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by Delaware law, as the same exists or may hereafter be amended, against all Expenses incurred or suffered by the Executive in connection therewith, and such indemnification shall continue as to
the Executive even if the Executive has ceased to be an officer, director, trustee or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators.

 

 

 

 

	
a.  
	
Expenses. As used in this Agreement, the term "Expenses" shall include, without limitation unless deemed for cause, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, and costs, attorneys' fees, accountants' fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing
a right to indemnification under this Agreement.

	
b.  
	
Enforcement. If a claim or request under this Section 9 is not paid by the Company or on its behalf, within thirty (30) days after a written claim or request has been received by the Company, the Executive may at any time thereafter bring suit against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part,
the Executive shall be entitled to be paid also the expenses of prosecuting such suit. All obligations for indemnification hereunder shall be subject to, and paid in accordance with, applicable Delaware law.

	
c.  
	
Advances of Expenses. Expenses incurred by the Executive in connection with any Proceeding shall be paid by the Company in advance upon request of the Executive that the Company pay such Expenses, but only in the event that the Executive shall have delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect
to which the Executive is not entitled to indemnification and (ii) a statement of his good faith belief that the standard of conduct necessary for indemnification by the Company has been met.

 

	
d.  
	
The Company will maintain a Director’s and Officer’s Insurance Policy naming the Executive as a covered party in amount deemed mutually sufficient to the Company and the Executive. Executive will pursue the policy and its enforcement with Board approval.

 

	
10.  
	
Survival of Certain Provisions: The representations, warranties and covenants and indemnity provisions contained in Sections 8 and 9 of this Agreement and the Company’s obligation to pay the Executive any
compensation earned pursuant hereto shall remain operative and in full force and effect regardless of any completion or termination of this Agreement and shall be binding upon, and shall inure to the benefit of any successors, assigns, heirs and personal representatives of the Company, the indemnified parties and any such person.

	
11.  
	
Notices: Notice given pursuant to any of the provisions of this Agreement shall be in writing and shall be mailed or delivered (a) if to the Company, at its offices at 1353 Old Temescal Road, Suite 108, Corona,
California 92881, and (b) if to Executive, at its offices at 4001 E 3rd Ave, Denver, CO 80220.

	
12.  
	
Counterparts: This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument.

	
13.  
	
Third Party Beneficiaries: This Agreement has been and is made solely for the benefit of the Parties hereto, and their respective successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement.

	
14.  
	
Validity: The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

	
15.  
	
Dispute Resolution: If a dispute arises out of or relating to this Agreement or the breach of this Agreement, and if the dispute cannot be settled through direct discussions, the Parties agree to first endeavor to settle the dispute in an amicable manner by mediation. Mediation
shall consist of an informal, nonbinding conference or conferences between the Parties and the mediator jointly, and at the discretion of the mediator, then in separate caucuses in which the mediator will seek to guide the Parties to a resolution of the case. The Parties shall attempt to select a mutually acceptable mediator. If the Parties cannot agree upon a mediator, the Parties shall seek assistance in the appointment of a mediator from the District Judge in the, State of Colorado.

	
a.  
	
Legal Fees and Expenses: If any contest or dispute shall rise between the Company and the Executive regarding any provision of this Agreement, the Company shall reimburse the Executive for all legal fees and expenses incurred by the Executive in connection with such contest
or dispute unless an unlawful act has preceded, but only if the Executive prevails to a substantial extent with respect to the Executive's claims brought and pursued in connection with such contest or dispute. Such reimbursement shall be made as soon as practicable following the resolution of such contest or dispute (whether or not appealed) to the extent the Company receives reasonable written evidence of such fees and expenses.

 

 

 

 

	
16.  
	
Choice of Law, Jurisdiction and Venue: This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Colorado. Any and all actions, suits, or judicial proceedings upon any claim arising from or relating to this Agreement, subject
to Paragraph 9 herein, shall be instituted and maintained in the State of Colorado. Each party waives the right to change of venue, or to file any action, suit or judicial proceeding in federal court. Notwithstanding this provision, if it is judicially determined that either party may file an action, suit or judicial proceeding in federal court, such action, suit or judicial proceeding shall be in the Federal District Court for the District of Colorado.

	
17.  
	
Miscellaneous: No provisions of this Agreement may be amended, modified, or waived unless such amendment or modification is agreed to in writing signed by the Executive and by a duly authorized officer of the Company, and such waiver is set forth in writing and signed by
the party to be charged. No waiver by either party hereto at any time of any breach by the other party hereto of any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement.
The respective rights and obligations of the parties hereunder of this Agreement shall survive the Executive's termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations. Except or otherwise provided in Section 9 hereof, the validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Colorado without regard to its conflicts of law principles

	
18.  
	
Section Headings: The section headings in this Employment Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation.

The parties’ authorized representatives have executed this Agreement as of the Effective Date, as defined above.

Jeffrey A Beunier                                                                                  
Universal Holdings, Inc

By: _____________________________                                                               By:   _______________________

Name:                                                                                  Name:

Title:                                                                                 Title:ex101.htm

 

Exhibit 10.1

 

REGISTRATION RIGHTS AGREEMENT

 

REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of September 21, 2009, by and among Vitran Corporation Inc., a corporation organized under the laws
of the Province of Ontario (the “Company”), and the undersigned purchasers (each, a “Purchaser,” and collectively, the “Purchasers”).

WHEREAS:

 

A.           In connection with the Securities Purchase Agreement, dated as of September 17, 2009, by and among the Company and the Purchasers (the “Securities Purchase Agreement”), the Company has agreed, upon
the terms and subject to the conditions set forth in the Securities Purchase Agreement, to issue and sell to each Purchaser shares of the Company’s common stock (the “Common Stock”).

 

B.           In accordance with the terms of the Securities Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively,
the “Securities Act”), and applicable state securities laws.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and each of the Purchasers
hereby agree as follows:

 

ARTICLE 1

 

DEFINITIONS

 

Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement.  As used in this Agreement, the following terms shall have the following meanings:

 

1.1           “Business Day” means any day other than Saturday, Sunday or any other day on which commercial banks in The City of New York or the City of Toronto are authorized or required by law to remain closed.

 

1.2           “Closing Date” shall have the meaning set forth in the Securities Purchase Agreement.

 

1.3           “Effective Date” means the date the Registration Statement has first been declared effective by the SEC.

 

1.4           “Effectiveness Deadline” means the date which is 90 calendar days after the Closing Date.

 

  

  

  

 

1.5           “Filing Deadline” means the date which is 30 days after the Closing Date.

 

1.6           “Investor” means a Purchaser or any transferee or assignee thereof to whom a Purchaser or another Investor assigns its rights under this Agreement and who agrees to become bound by the provisions
of this Agreement in accordance with Article 9.

 

1.7           “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, a government or any department or agency thereof,
or other entity of any kind.

 

1.8            “register,” “registered,” and “registration” refer to a
registration effected by preparing and filing one or more Registration Statements (as defined below) in compliance with the Securities Act and pursuant to Rule 415 and the declaration or ordering of effectiveness of such Registration Statement(s) by the SEC.

 

1.9           “Registrable Securities” means (i) the Common Stock issued pursuant to the Securities Purchase Agreement, and (ii) any share capital of the Company issued with respect to such Common Stock as a
result of any split, dividend, recapitalization, exchange or similar event or otherwise.

 

1.10           “Registration Statement” means a registration statement or registration statements of the Company filed under the Securities Act covering the Registrable Securities, any amendments, supplements,
and exhibits thereto and any material incorporated by reference (or deemed to be incorporated by reference) therein.

 

1.11           “Required Holders” means the holders of at least 50% of the Registrable Securities.

 

1.12           “Rule 415” means Rule 415 under the Securities Act or any successor rule providing for offering securities on a continuous or delayed basis.

 

1.13           “SEC” means the United States Securities and Exchange Commission.

 

ARTICLE 2

 

REGISTRATION

 

2.1           Mandatory Registration.  The Company shall prepare, and, as soon as practicable but in no event later than the Filing Deadline, file with the SEC the Registration Statement on Form S-3 covering
the resale of all of the Registrable Securities.  In the event that Form S-3 is unavailable for such a registration, the Company shall use such other form as is available for such a registration, subject to the provisions of Section 2.4.  The Registration Statement prepared pursuant hereto shall register for resale all of the Registrable Securities outstanding as of the date the Registration Statement is initially filed with the SEC.  The Registration Statement shall contain (except
if otherwise directed by the Required Holders) the “Selling Stockholders” and  “Plan of Distribution” sections in substantially the form attached hereto as Exhibit A.  The Company shall use commercially reasonable efforts to have the Registration Statement declared effective
by the SEC as soon as practicable, but in no event later than the Effectiveness Deadline.

 

  

  

  

By 9:30 a.m. on the Business Day immediately following the Effective Date, the Company shall file with the SEC in accordance with Rule 424 under the Securities Act the final prospectus to be used in connection with sales pursuant to such Registration Statement.

 

2.2           Limitation to Registrable Securities.  In no event shall the Company include any securities other than Registrable Securities on any Registration Statement without the prior written consent
of the Required Holders.

 

2.3           Legal Counsel.  Each Investor may designate legal counsel from time to time to review and oversee at the expense of such Investor any registration pursuant to this Article 2 (the “Legal
Counsel”).  The Company and Legal Counsel shall reasonably cooperate with each other in performing the Company’s obligations under this Agreement.

 

2.4           Ineligibility for Form S-3.  In the event that Form S-3 is not available for the registration of the resale of Registrable Securities hereunder, the Company shall (i) register the resale
of the Registrable Securities on another appropriate form that covers the resale of all of the Registrable Securities pursuant to the provisions of this Agreement and (ii) undertake to register the Registrable Securities on Form S-3 as soon as such form is available, provided that the Company shall maintain the effectiveness of the Registration Statement then in effect until such time as a Registration Statement on Form S-3 covering the Registrable Securities has been declared effective by the SEC.

 

2.5           Effect of Failure to File and Obtain and Maintain Effectiveness of Registration Statement.  If (i) a Registration Statement covering all of the Registrable Securities is (A) not filed with
the SEC on or before the applicable Filing Deadline (a “Filing Failure”) or (B) not declared effective by the SEC on or before the applicable Effectiveness Deadline (an “Effectiveness Failure”) or (ii) on any day after the Effective Date sales of all of the Registrable Securities required to be included on such Registration Statement cannot be made (other than during an Allowable
Grace Period (as defined in Section 3.16) pursuant to such Registration Statement or otherwise (including, without limitation, because of a failure to keep such Registration Statement effective, to disclose such information as is necessary for sales to be made pursuant to such Registration Statement, or to maintain the listing of the Common Stock) (a “Maintenance Failure”) then, as partial relief for the damages to any holder by reason of any
such delay in or reduction of its ability to sell the Common Stock (which remedy shall not be exclusive of any other remedies available at law or in equity) and not as a penalty, the Company shall pay to each holder of Registrable Securities relating to such Registration Statement an amount in cash equal to 1.0% of the aggregate Purchase Price (as defined in the Securities Purchase Agreement) paid by such Purchaser on each of the following dates: (i) on every 30th day after the day of a Filing Failure and thereafter
(pro rated for periods totaling less than 30 days) until the earlier of (x) the date as of which the Investors may sell all of the Registrable Securities without limitation or restriction pursuant to Rule 144 (or any successor thereto) promulgated under the Securities Act (“Rule 144”) and (y) the date on which such Filing Failure is cured; (ii) on every 30th day after the day of an Effectiveness Failure and thereafter (pro rated for periods totaling
less than 30 days) until the earlier of (x) the date as of which the Investors may sell all of the Registrable Securities without limitation or restriction pursuant to Rule 144 and (y) the date on which such Effectiveness Failure is cured; (iii) on every 30th day after the initial day of a Maintenance Failure and thereafter (pro rated for periods totaling less than 30

 

  

  

  

days) until the earlier of (x) the date as of which the Investors may sell all of the Registrable Securities without limitation or restriction pursuant to Rule 144 and (y) the date on which such Maintenance Failure is cured.  The payments to which a holder shall be entitled pursuant to this Section 2.5 are referred to herein
as “Registration Delay Payments.”  Registration Delay Payments shall be paid on the earlier of (I) the 30th day after the event or failure giving rise to the Registration Delay Payments has occurred and (II) the third Business Day after the event or failure giving rise to the Registration Delay Payments is cured.  In the event the Company fails to make Registration Delay Payments in a timely manner, such Registration Delay
Payments shall bear interest at the rate of 2.0% per month (prorated for partial months) until paid in full.  Notwithstanding anything herein or in the Securities Purchase Agreement to the contrary, in no event shall the aggregate amount of Registration Delay Payments payable to any Investor exceed, in the aggregate, 10% of the aggregate Purchase Price paid by such Purchaser.

 

ARTICLE 3

 

RELATED OBLIGATIONS

 

At such time as the Company is obligated to file a Registration Statement with the SEC pursuant to Section 2.1, the Company will use commercially reasonable efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof
and, pursuant thereto, the Company shall have the following obligations:

 

3.1           Acceleration; Adequate Disclosure.  The Company shall submit to the SEC, within two Business Days after the Company learns that no review of a particular Registration Statement will be made
by the staff of the SEC or that the staff has no further comments on a particular Registration Statement, as the case may be, a request for acceleration of effectiveness of such Registration Statement to a time and date not later than 48 hours after the submission of such request.  The Company shall keep each Registration Statement continuously effective pursuant to Rule 415 at all times until the earlier of (i) the date as of which the Investors may sell all of the Registrable Securities covered by
such Registration Statement without limitation or restriction pursuant to Rule 144 (or any successor thereto) promulgated under the Securities Act without the requirement for the Company to be in compliance with the current public information requirements under Rule 144 or (ii) the date on which the Investors shall have sold all of the Registrable Securities covered by such Registration Statement (the “Registration Period”).  The Company
shall ensure that each Registration Statement (including any amendments or supplements thereto and prospectuses contained therein) does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein (in the case of prospectuses, in the light of the circumstances in which they were made) not misleading.

 

3.2           Amendments to Registration Statement.  The Company shall prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement and
the prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated under the Securities Act, as may be necessary to keep such Registration Statement continuously effective at all times during the Registration Period, and, during such period, comply in all material respects with the provisions of the Securities Act with respect to the disposition of all Registrable Securities of the

 

  

  

  

Company covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such Registration Statement.  In the case of amendments and supplements to a Registration
Statement which are required to be filed pursuant to this Agreement (including pursuant to this Section 3.2) by reason of the Company filing a report on Form 10-Q, Form 10-K or any analogous report under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company shall have incorporated such report by reference into such Registration Statement, if applicable, or shall file such amendments or supplements with the SEC on the
same day on which the Exchange Act report is filed which created the requirement for the Company to amend or supplement such Registration Statement.  The Company shall respond as promptly as reasonably practicable to any comments received from the SEC with respect to each Registration Statement or any amendment thereto and, as promptly as reasonably possible, provide the Investors true and complete copies of all correspondence from and to the SEC relating to such Registration Statement that pertains
to the Investors as “Selling Stockholders” but not any comments that would result in the disclosure to the Investors of material and non-public information concerning the Company.

 

3.3           Review by Legal Counsel; Information Rights.  The Company shall (A) permit Legal Counsel to review and comment upon (i) a Registration Statement at least three Business Days prior to its
filing with the SEC and (ii) all amendments and supplements to all Registration Statements (except for Annual Reports on Form 10-K, and Reports on Form 10-Q, Reports on Form 8-K and any similar or successor reports) at least three Business Days prior to their filing with the SEC, and (B) not file any Registration Statement or amendment or supplement thereto in a form to which Legal Counsel reasonably objects. Legal Counsel shall provide any comments within two Business Days after receipt of a document for review
pursuant to the previous sentence.  The Company shall, as promptly as practicable, furnish to Legal Counsel, without charge, (i) copies of any correspondence from the SEC or the staff of the SEC to the Company or its representatives relating to any Registration Statement, (ii) after the same is prepared and filed with the SEC, one copy of any Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference, if requested
by an Investor, and all exhibits and (iii) upon the effectiveness of any Registration Statement, one copy of the prospectus included in such Registration Statement and all amendments and supplements thereto.  The Company shall reasonably cooperate with Legal Counsel in performing the Company’s obligations pursuant to this Article 3.

 

3.4           Prospectus Delivery.  The Company shall, as promptly as practicable, furnish to each Investor whose Registrable Securities are included in any Registration Statement, without charge,  (i)
after the same is prepared and filed with the SEC, at least one copy of such Registration Statement and any amendment(s) thereto, including financial statements and schedules, all documents incorporated therein by reference, if requested by an Investor, all exhibits and each preliminary prospectus, (ii) upon the effectiveness of any Registration Statement, an electronic copy of the prospectus included in such Registration Statement and all amendments and supplements thereto; provided, that the Company shall promptly
provide each Investor with such number of copies of such prospectus as such Investor may reasonably request and (iii) such other documents, including copies of any preliminary or final prospectus, as such Investor may reasonably request from time to time in order to facilitate the disposition of the Registrable Securities owned by such Investor.

 

  

  

  

 

3.5           Blue Sky Compliance.  The Company shall use commercially reasonable efforts to (i) register and qualify or cooperate with the selling Investors in connection with the registration or qualification
(or exemption from the registration or qualification) of Registrable Securities for the resale by Investors of the Registrable Securities covered by a Registration Statement under such other securities or “blue sky” laws of all applicable jurisdictions in the United States, (ii) prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Registration
Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for
this Section 3.5, (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process in any such jurisdiction.  The Company shall promptly notify Legal Counsel and each Investor who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable Securities for sale under the securities or “blue sky” laws of any jurisdiction in the
United States or its receipt of notice of the initiation or threatening of any proceeding for such purpose.

 

3.6           Updates to Prospectus.  The Company shall notify Legal Counsel and each Investor in writing of the happening of any event, as promptly as practicable after becoming aware of such event,
or the passage of time as a result of which a Registration Statement or the prospectus included in a Registration Statement, as then in effect, includes an untrue statement of a material fact or an omission to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (provided that in no event shall such notice contain any material non-public information), and, subject to Section 3.16, promptly
prepare a supplement or amendment to such Registration Statement to correct such untrue statement or omission and deliver ten (10) copies of such supplement or amendment to Legal Counsel and each Investor (or such other number of copies as Legal Counsel or such Investor may reasonably request).  The Company shall also promptly notify Legal Counsel and each Investor in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a Registration Statement
or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to Legal Counsel and each Investor by facsimile on the same day of such effectiveness and by overnight mail), (ii) of any request by the SEC or any other federal or state government authority for amendments or supplements to a Registration Statement or related prospectus or related information, (iii) of the Company’s reasonable determination that a post-effective amendment to a Registration Statement
would be appropriate, and (iv) when the SEC notifies the Company whether there will be a “review” of such Registration Statement and whenever the SEC comments in writing on any Registration Statement (in which case the Company shall provide to each of the Investors true and complete copies of all comments that pertain to the Investors as a “Selling Stockholder” or to the “Plan of Distribution” and all written responses thereto, but not information that the Company believes
would constitute material and non-public information).  The Company shall notify Legal Counsel and each Investor in writing not more than one Business Day after (x) the Company becoming aware of the issuance by the

 

  

  

  

SEC or any other federal or state governmental authority of any stop order suspending the effectiveness of a Registration Statement covering any or all of the Registrable Securities or the initiation of any action, claim, suit, investigation or proceeding (including, without limitation, an investigation or partial proceeding, such
as a deposition), whether commenced or threatened (collectively, “Proceeding”), for that purpose; or (y) the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Securities for sale in any jurisdiction, or the initiation or threatening of any Proceeding for such purpose.

 

3.7           Prevention of Suspension of Effectiveness.  The Company shall use commercially reasonable efforts to prevent the issuance of any stop order or other suspension of effectiveness of a Registration
Statement, or the suspension of the qualification (or exemption from qualification) of any of the Registrable Securities for sale in any jurisdiction and, if such an order or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify Legal Counsel and each Investor who holds Registrable Securities being sold of the issuance of such order and the resolution thereof or its receipt of notice of the initiation or threat of any proceeding for such purpose.

 

3.8           Underwriter Status.  If, after the execution of this Agreement, the SEC informs the Company that one or more of the Investors may be an underwriter of Registrable Securities, at the request
of the Company, such Investor shall reasonably cooperate with the Company in amending the Registration Statement to reflect the fact that such Investor is an underwriter.

 

3.9           Confidentiality.  The Company shall hold in confidence and not make any disclosure of information concerning an Investor provided to the Company unless (i) disclosure of such information
is necessary to comply with federal or state securities laws or Canadian Securities Laws, (ii) the disclosure of such information is necessary to avoid or correct a misstatement or omission in any Registration Statement, (iii) the release of such information is ordered pursuant to a subpoena or other order from a court or governmental body of competent jurisdiction, or (iv) such information has been made generally available to the public.  The Company agrees that it shall, upon learning that disclosure
of such information concerning an Investor is sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt written notice to such Investor and allow such Investor, at the Investor’s expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, such information.

 

3.10           Listing of Registrable Securities.  The Company shall cause all of the Registrable Securities covered by a Registration Statement to be listed on the Toronto Stock Exchange and the Nasdaq
Global Market and each other securities exchange or automated quotation system on which securities of the same class or series issued by the Company are then listed.  The Company shall pay all fees and expenses in connection with satisfying its obligation under this Section 3.10.

 

3.11           Certificates.  The Company shall cooperate with the Investors who hold Registrable Securities being offered and, to the extent applicable, facilitate the timely preparation and delivery
of certificates (not bearing any restrictive legend) representing the Registrable Securities to be offered pursuant to a Registration Statement and enable such certificates to be in

 

  

  

  

such amounts as the Investors may reasonably request and registered in such names as the Investors may request.

 

3.12           Prospectus Supplements Requested by Investor.  If reasonably requested by an Investor, the Company shall, as soon as practicable (i) incorporate in a prospectus supplement or post-effective
amendment such information as an Investor reasonably requests to be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect to the number of Registrable Securities being offered or sold, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering; (ii) make all required filings of such prospectus supplement or post-effective amendment after being notified of
the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement if reasonably requested by an Investor holding any Registrable Securities.

 

3.13           Compliance with Regulations.  The Company shall otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the SEC, the Ontario Securities Commission,
and all other applicable regulatory authorities in connection with any registration hereunder, including without limitation Rule 172 under the Securities Act.  Further, the Company shall notify the Investors promptly if the Company no longer satisfies the conditions of Rule 172.

 

3.14           Reporting Issuer Status.  During the Registration Period, the Company shall continue to be a “reporting issuer” or the equivalent thereof in good standing under the applicable
Canadian Securities Laws in each of the provinces of Canada and is in and shall continue to be in compliance with all applicable Canadian Securities Laws in all material respects and will make all necessary filings (including, without limitation, the filing of all continuous disclosure materials) required to be filed by the Company pursuant to the Canadian Securities Laws, but will not be required to qualify the Registrable Securities for sale in Canada.

 

3.15           Confirmation of Effectiveness to Transfer Agent.  Within one Business Day after a Registration Statement that covers Registrable Securities is ordered effective by the SEC, the Company
shall deliver, and shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities (with copies to the Investors whose Registrable Securities are included in such Registration Statement) confirmation that such Registration Statement has been declared effective by the SEC in the form attached hereto as Exhibit B.

 

3.16           Disclosure Grace Period.  Notwithstanding anything to the contrary herein, at any time after the Effective Date, the Company may delay the disclosure of material non-public information
concerning the Company the disclosure of which at the time is not, in the good faith opinion of the Board of Directors of the Company, in the best interest of the Company and, in the opinion of counsel to the Company, otherwise required (a “Grace Period”); provided, that the Company shall promptly (i) notify the Investors in writing of the existence of material non-public information giving rise to a Grace Period (provided that in each notice
the Company will not disclose the content of such material non-public information to the Investors) and the date on which the Grace Period will begin, (ii) use commercially reasonable efforts to terminate a Grace Period as promptly as practicable, and (iii) notify the Investors in writing of the date on which

 

  

  

  

the Grace Period ends; and, provided further, that no Grace Period shall exceed 20 consecutive days and no more than two Grace Periods shall occur during any 365 day period and the first day of any Grace Period must be at least two trading days after the last day of any prior Grace Period (each, an “Allowable
Grace Period”).  For purposes of determining the length of a Grace Period above, the Grace Period shall begin on and include the date the Investors receive the notice referred to in clause (i) and shall end on and include the later of the date the Investors receive the notice referred to in clause (ii) and the date referred to in such notice.  The provisions of Section 2.5 hereof shall not be applicable during the period of any Allowable Grace Period.  Upon expiration
of the Grace Period, the Company shall again be bound by the first sentence of Section 3.6 with respect to the information giving rise thereto unless such material non-public information is no longer applicable.  Notwithstanding anything to the contrary, the Company shall cause its transfer agent to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with the terms of the Securities Purchase Agreement in connection with any sale of Registrable Securities with respect
to which an Investor has entered into a contract for sale prior to the Investor’s receipt of the notice of a Grace Period and for which the Investor has not yet settled.

 

3.17           S-3 Eligibility.  The Company shall use commercially reasonable efforts to maintain compliance with the eligibility requirements of Form S-3 so that such form is continuously available
for the registration of the resale of Registrable Securities during the Registration Period.

 

ARTICLE 4

 

OBLIGATIONS OF THE INVESTORS

 

4.1           Information to be Included in Registration Statement.  At least five Business Days prior to the first anticipated filing date of a Registration Statement other than the initial Registration
Statement, the Company shall notify each Investor in writing of the information the Company requires from each such Investor if such Investor elects to have any of such Investor’s Registrable Securities included in such Registration Statement.  It shall be a condition precedent to the obligations of the Company to complete the registration pursuant to this Agreement with respect to the Registrable Securities of a particular Investor that such Investor furnish to the Company such information regarding
itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as shall be reasonably required to effect the effectiveness of the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request.

 

4.2           Cooperation.  Each Investor, by such Investor’s acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the Company in connection
with the preparation and filing of any Registration Statement hereunder, unless such Investor has notified the Company in writing of such Investor’s election to exclude all of such Investor’s Registrable Securities from such Registration Statement.

 

4.3           Cease Disposition.  Each Investor agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3.6, such Investor will immediately
discontinue disposition of Registrable Securities pursuant to any Registration

 

  

  

  

Statement(s) covering such Registrable Securities until such Investor’s receipt of notice that the supplemented or amended prospectus contemplated by Section 3.6 has been filed with the SEC or receipt of notice that no supplement or amendment is required.  Notwithstanding anything to the contrary, the Company shall
cause its transfer agent to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with the terms of the Securities Purchase Agreement in connection with any sale of Registrable Securities with respect to which an Investor has entered into a contract for sale prior to the Investor’s receipt of a notice from the Company of the happening of any event of the kind described in Section 3.6 and for which the Investor has not yet settled.

 

4.4           Prospectus Delivery.  Each Investor covenants and agrees that it will comply with the prospectus delivery requirements of the Securities Act as applicable to it or an exemption therefrom
in connection with sales of Registrable Securities pursuant to the Registration Statement.

 

ARTICLE 5

 

EXPENSES OF REGISTRATION

 

All expenses, other than underwriting discounts and commissions or as otherwise provided in this Agreement, incurred in connection with registrations, filings or qualifications pursuant to Articles 2 and 3, including, without limitation, all registration, listing and qualifications
fees, printer’s and accounting fees, and fees and disbursements of counsel for the Company shall be paid by the Company.

 

ARTICLE 6

 

INDEMNIFICATION

 

In the event any Registrable Securities are included in a Registration Statement under this Agreement:

 

6.1           Indemnification by Company.  To the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend each Investor, the directors, officers, members,
partners, employees, agents, representatives of, and each Person, if any, who controls any Investor within the meaning of the Securities Act or the Exchange Act (each, an “Indemnified Person”), against any losses, claims, damages, liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys’ fees, amounts paid in settlement or expenses, joint or several, (collectively, “Claims”)
incurred in investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency, body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party thereto (“Indemnified Damages”), to which any of them may become subject insofar as such Claims (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based upon:  (i) any untrue statement or alleged untrue statement of a material fact in a Registration Statement or any post-effective amendment thereto or in any filing made in connection with the qualification of the offering under the securities or other “blue sky” laws of

 

  

  

  

any jurisdiction in which Registrable Securities are offered (“Blue Sky Filing”), or the omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus if used prior to the effective date of such Registration Statement, or contained in the final prospectus (as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in the light of the circumstances under which the statements therein were made, not misleading, (iii) any violation
or alleged violation by the Company of the Securities Act, the Exchange Act, the Canadian Securities Laws, any other law, including, without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable Securities pursuant to a Registration Statement or (iv) any violation of this Agreement (the matters in the foregoing clauses (i) through (iv) being, collectively, “Violations”).  Subject
to Section 6.3, the Company shall reimburse the Indemnified Persons, promptly as such Indemnified Damages are incurred and are due and payable, for any legal fees or other reasonable expenses incurred by them in connection with investigating or defending any such Claim.  Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6.1:  (i) shall not apply to a Claim by an Indemnified Person arising out of or based upon a Violation which
occurs in reliance upon and in strict conformity with information furnished in writing to the Company by such Indemnified Person expressly for use in the Registration Statement or any amendment thereof or supplement thereto, if such prospectus was timely made available by the Company to such Indemnified Person pursuant to Section 3.3; and (ii) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably
withheld or delayed.  Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer of the Registrable Securities by the Investors pursuant to Article 9.

 

6.2           Indemnification by Investor.  In connection with any Registration Statement in which an Investor is participating, each such Investor agrees to severally and not jointly indemnify, hold
harmless and defend, to the same extent and in the same manner as is set forth in Section 6.1, the Company, each of its directors, each of its officers who signs the Registration Statement and each Person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act (each, an “Indemnified Party”), against any Claim or Indemnified Damages to which any of them may become subject, under the Securities Act, the Exchange
Act. Canadian Securities Laws or otherwise, insofar as such Claim or Indemnified Damages arise out of or are based upon any Violation, in each case to the extent, and only to the extent, that such Violation occurs in reliance upon and in strict conformity with written information furnished to the Company by such Investor expressly for use in the Registration Statement or any amendment thereof or supplement thereto and, subject to Section 6.3, such Investor will reimburse any legal or other expenses reasonably
incurred by an Indemnified Party in connection with investigating or defending any such Claim; provided, however, that the indemnity agreement contained in this Section 6.2 and the agreement with respect to contribution contained in Article 7 shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of such Investor, which consent shall not be unreasonably withheld or delayed; provided, further, however, that the Investor shall be liable under
this Section 6.2 for only that amount of a Claim or Indemnified Damages as does not

 

  

  

  

exceed the dollar amount of the net proceeds received by such Investor as a result of the sale of Registrable Securities pursuant to such Registration Statement.  Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified Party and shall survive the transfer
of the Registrable Securities by the Investors pursuant to Article 9.  Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6.2 with respect to any preliminary prospectus shall not inure to the benefit of any Indemnified Party if the untrue statement or omission of material fact contained in the preliminary prospectus was corrected on a timely basis in the prospectus, as then amended or supplemented.

 

6.3           Participation; Cooperation.  Promptly after receipt by an Indemnified Person or Indemnified Party under this Article 6 of notice of the commencement of any action or proceeding (including
any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Article 6, deliver to the indemnifying party a written notice of the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with
counsel mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be; provided, however, that an Indemnified Person or Indemnified Party shall have the right to retain its own counsel with the fees and expenses of not more than one counsel for such Indemnified Person or Indemnified Party to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation by such counsel of the Indemnified
Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding.  In the case of an Indemnified Person, legal counsel referred to in the proviso of the immediately preceding sentence shall be selected by the Investors holding at least a majority in interest of the Registrable Securities included in the Registration Statement
to which the Claim relates.  The Indemnified Party or Indemnified Person shall cooperate fully with the indemnifying party in connection with any negotiation or defense of any such action or Claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified Party or Indemnified Person that relates to such action or Claim.  The indemnifying party shall keep the Indemnified Party or Indemnified Person reasonably apprised at all
times as to the status of the defense or any settlement negotiations with respect thereto.  No indemnifying party shall be liable for any settlement of any action, claim or proceeding effected without its prior written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition its consent.  No indemnifying party shall, without the prior written consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter
into any settlement or other compromise that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified Person of a release from all liability in respect to such Claim or litigation, and such settlement shall not include any admission as to fault on the part of the Indemnified Party.  Following indemnification as provided for hereunder, the indemnifying party shall be subrogated to all rights of the Indemnified Party or Indemnified
Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made.  The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement

 

  

  

  

of any such action shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Article 6, except to the extent that the indemnifying party is materially prejudiced in its ability to defend such action.

 

6.4           Payment of Indemnification.  The indemnification required by this Article 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as
and when bills are received or Indemnified Damages are incurred.

 

6.5           Non-Exclusive Remedy.  The indemnity agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against the
indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.

 

ARTICLE 7

 

CONTRIBUTION

 

To the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect to any amounts for which it would otherwise be liable under Article 6 to the fullest extent permitted by law; provided,
however, that:  (i) no Person involved in the sale of Registrable Securities that is guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) in connection with such sale shall be entitled to contribution from any Person involved in such sale of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limited in amount to the net amount of proceeds received by such seller
from the sale of such Registrable Securities pursuant to such Registration Statement.

 

ARTICLE 8

 

REPORTS UNDER THE EXCHANGE ACT

 

8.1           With a view to making available to the Investors the benefits of Rule 144 promulgated under the Securities Act or any other similar rule or regulation of the SEC that may at any time permit the Investors to sell securities of the Company to the public without registration
(“Rule 144”), the Company agrees to:

 

(a)           make and keep public information available, as those terms are understood and defined in Rule 144;

 

(b)           file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act so long as the Company remains subject to such requirements and the filing of such reports and other documents is required
for the applicable provisions of Rule 144; and

 

(c)           furnish to each Investor so long as such Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company, if true, that it has complied with the reporting requirements of Rule 144, the Securities Act and the Exchange Act,

 

  

  

  

and (ii) such other information as may be reasonably requested to permit the Investors to sell such securities pursuant to Rule 144 without registration.

 

ARTICLE 9

 

ASSIGNMENT OF REGISTRATION RIGHTS

 

The rights under this Agreement shall be automatically assignable by the Investors to any transferee of all or any portion of such Investor’s Registrable Securities if:  (i) the Investor agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company within a reasonable time after such assignment; (ii) the Company is, within a reasonable time after such transfer or assignment, furnished with written notice of (a) the name and address of such transferee or assignee, and (b) the securities with respect to which such registration rights are being transferred or assigned; (iii) immediately following such transfer or assignment the further disposition of such securities by the transferee or assignee is restricted
under the Securities Act or applicable state securities laws; (iv) at or before the time the Company receives the written notice contemplated by clause (ii) of this sentence the transferee or assignee agrees in writing with the Company to be bound by all of the provisions contained herein; and (v) such transfer shall have been made in accordance with the applicable requirements of the Securities Purchase Agreement, and in accordance with all applicable securities laws.

 

ARTICLE 10

 

AMENDMENT OF REGISTRATION RIGHTS

 

Provisions of this Agreement may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Required Holders.  Any amendment or waiver effected
in accordance with this Article 10 shall be binding upon each Investor and the Company.  No such amendment shall be effective to the extent that it applies to less than all of the holders of the Registrable Securities.  No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of any of this Agreement unless the same consideration also is offered to all of the parties to this Agreement.

 

ARTICLE 11

 

MISCELLANEOUS

 

11.1           Holders of Record.  A Person is deemed to be a holder of Registrable Securities whenever such Person owns or is deemed to own of record such Registrable Securities.  If the Company
receives conflicting instructions, notices or elections from two or more Persons with respect to the same Registrable Securities, the Company shall act upon the basis of instructions, notice or election received from the record owner of such Registrable Securities.

 

11.2           Notices.  Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed

 

  

  

  

to have been delivered:  (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one Business Day after deposit with a nationally recognized overnight delivery
service, in each case properly addressed to the party to receive the same.  The addresses and facsimile numbers for such communications shall be:

 

If to the Company:

 

Vitran Corporation, Inc.

185 The West Mall, Suite 701

Toronto, ON, Canada, M9C 5L5

Telephone:             (416) 596-7664 Ext. 231

Facsimile:                (416) 596-8039

Attention:               Richard Gaetz, President and Chief Executive Officer

With copies (which shall not constitute notice) to:

Lang Michener LLP

Brookfield Place

Suite 200, 181 Bay Street

Toronto, ON, Canada, M5J 2T7

Telephone:              (416) 360-8600

Facsimile:                 (416) 365-1719

Attention:                Hellen L. Siwanowicz, Esq.

and

Drinker Biddle & Reath LLP

One Logan Square

18th and Cherry Streets

Philadelphia, PA  19103

Telephone:               (215) 988-2880

Facsimile:                  (215) 988-2757

Attention:                 Stephen T. Burdumy, Esq

   Matthew M. McDonald, Esq.

If to Legal Counsel:

To be provided to the Company in writing following appointment of Legal Counsel.

If to a Purchaser, to its address and facsimile number set forth on the Schedule of Purchasers attached hereto, with copies to such Purchaser’s representatives as set forth on the Schedule of Purchasers, or to such other address and/or facsimile number and/or to the attention of such other Person as the recipient party has
specified by written notice given to each other party five days prior to the effectiveness of such change.  Written confirmation of receipt (A) given by the

 

  

  

  

recipient of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s facsimile machine containing the time, date, recipient facsimile number and an image of the first page of such transmission or (C) provided by a courier or overnight courier service shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.

 

11.3           No Waiver.  Failure of any party to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate as a waiver
thereof.

 

11.4           Governing Law; Waiver of Jury Trial.  All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the
State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York.  Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.  Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing
a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.  If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

11.5           Entire Agreement.  This Agreement, the other Transaction Documents (as defined in the Securities Purchase Agreement) and the instruments referenced herein and therein constitute the entire
agreement among the parties hereto with respect to the subject matter hereof and thereof.  There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein and therein.  This Agreement, the other Transaction Documents and the instruments referenced herein and therein supersede all prior agreements and understandings among the parties hereto with respect to the subject matter hereof and thereof.

 

11.6           Successors and Assigns.  Subject to the requirements of Article 9, this Agreement shall inure to the benefit of and be binding upon the permitted successors and assigns of each of the parties
hereto.

 

  

  

  

 

11.7           Headings.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

11.8           Counterparts; Facsimile Signatures.  This Agreement may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and the same
agreement.  This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

 

11.9           Further Assurances; No Inconsistent Agreements.  Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.  Neither the Company nor any of its subsidiaries (as such term is defined in the Business Corporations Act (Ontario)) (the “subsidiaries”)
has entered, as of the date hereof, nor shall the Company or any of the Subsidiaries, on or after the date hereof, enter into any agreement with respect to its securities, that would have the effect of impairing the rights granted to the Investors in this Agreement or otherwise conflicts with the provisions hereof.

 

11.10           Required Consent.  All consents and other determinations required to be made by the Investors pursuant to this Agreement shall be made, unless otherwise specified in this Agreement, by
the Required Holders.

 

11.11           Construction.  The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction will be applied
against any party.

 

11.12           No Third Party Beneficiaries.  This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor
may any provision hereof be enforced by, any other Person, except to the extent set forth in Article 6.

 

11.13           Several Liability.  The obligations of each Investor hereunder are several and not joint with the obligations of any other Investor, and no provision of this Agreement is intended to confer
any obligations on any Investor vis-à-vis any other Investor.  Nothing contained herein, and no action taken by any Investor hereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other kind of entity or group, or create a presumption that the Investors are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated herein.

 

[Signature Page Follows]

 

  

  

  

IN WITNESS WHEREOF, each Purchaser and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the date first written above.

 

	  	
COMPANY:

	  	  	  
	  	
VITRAN CORPORATION INC.

	  	  	  
	  	  	  
	  	  	  
	  	
By:
	
/s/ Sean Washchuk

	  	
Name:
	
Sean Washchuk

	  	
Title:
	
Vice President, Finance and

	  	  	
Chief Financial Officer

 

 

 

 

 

 

 

[Signature Page to Registration Rights Agreement]

 

  

  

  

IN WITNESS WHEREOF, each Purchaser and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed as of the date first written above.

 

	  	
PURCHASER:

	  	  	  
	  	  	  
	  	
TELEION FUND I, LP

	  	  	  
	  	
By:
	
/s/ James G. Baker III

	  	
Name:
	
James G. Baker III

	  	
Title:
	
President, Teleion Capital LLC,

	  	  	
Manager of Teleion Fund I, LP

 

  

  

  

	  	
RIDGECREST PARTNERS QP, L.P.

	 	 
	  	  	  
	  	
By:
	
/s/ Todd McElroy

	  	
Name:
	
Todd McElroy

	  	
Title:
	
CFO

  

  

  

	  	
T. ROWE PRICE ASSOCIATES, INC.,

	  	
Investment Advisor, By and on Behalf of

	  	
its Participating Advisory Funds Listed on the Schedule of Purchasers

	 	 
	  	  	  
	  	
By:
	
/s/ Hugh M. Evans III

	  	
Name:
	
Hugh M. Evans III

	  	
Title:
	
Vice President

  

  

  

	  	
SCOPUS ASSET MANAGEMENT LP

	  	  	  
	 	 	 
	  	
By:
	
/s/ Jonathan D’Orsi

	  	
Name:
	
Jonathan D’Orsi

	  	
Title:
	
COO

  

  

  

	  	
FIDELITY PURITAN TRUST:

	  	
FIDELITY LOW-PRICED STOCK FUND

	 	 
	  	  	  
	  	
By:
	
/s/ Jeffrey Christian

	  	
Name:
	
Jeffrey Christian

	  	
Title:
	
Deputy Treasurer

 

  

  

  

	  	
UBS O’CONNOR LLC

	  	
F/B/O: O’CONNOR PIPES CORPORATE 

STRATEGIES MASTER LIMITED

	 	 
	 	 
	  	
By:
	
/s/ Jeffrey Putman

	  	
Name:
	
Jeffrey Putman

	  	
Title:
	
Executive Director

 

  

  

  

	  	
NEWLAND MASTER FUND, LTD.

	  	  	  
	 	 	 
	  	
By:
	
/s/ Joseph Yankovich

	  	
Name:
	
Joseph Yankovich

	  	
Title:
	
CFO

 

  

  

  

	  	
ADVANCED SERIES TRUST 

	  	
AST ACADEMIC STRATEGIES ASSET

	  	
ALLOCATION PORTFOLIO (the “Fund”)

	 	 
	  	  	  
	  	
By:
	
Jennison Associates LLC,

	  	  	
as Subadvisor to the Fund

	  	  	  
	  	
By:
	
/s/ Ubong U. Edemeka

	  	
Name:
	
Ubong U. Edemeka

	  	
Title:
	
Managing Director and

	  	  	
Porfolio Manager of the Fund

 

  

  

  

	  	
JENNISON SMALL COMPANY FUND, INC. (the “Fund”)

	 	 
	  	  	  
	  	
By:
	
Jennison Associates LLC,

	  	  	
as Subadvisor to the Fund

	  	  	  
	  	
By:
	
/s/ John P. Mullman

	  	
Name:
	
John P. Mullman

	  	
Title:
	
Managing Director and

	  	  	
Portfolio Manager of the Fund

 

[Purchaser Signature Page to Registration Rights Agreement]

 

  

  

  

SCHEDULE OF PURCHASERS

 

	  	
Purchaser
	
Purchaser’s Address

and Facsimile Number
	
No. of Common Shares

	
1.
	
Teleion Fund I, LP
	
150 Chickering Meadow, Nashville, TN 37215

 

Fax No.: 615-523-2161

Attn: Jim Baker, President
	
100,000

	
2.
	
Ridgecrest Partners QP, L.P.
	
767 Third Ave, 20th Floor, New York, NY 10017

 

Fax No.:212-935-6095

Attn: Todd McElroy
	
75,000

	
3.
	
T. Rowe Price Associates Inc. by and on behalf of T. Rowe Price Small-Cap Value Fund, Inc.
	
100 East Pratt St., Baltimore, MD 21202

 

Fax No.:410-345-6575

Attn: Margie Schwartz, Senior Legal Analyst
	
255,900

	
4.
	
T. Rowe Price Associates Inc. by and on behalf of T.Rowe Price U.S. Equities Trust
	
100 East Pratt St., Baltimore, MD 21202

 

Fax No.:410-345-6575

Attn: Margie Schwartz, Senior Legal Analyst
	
437

	
5.
	
Scopus Asset Management LP
	
623 Fifth Ave, 31st Floor, New York, NY 10022

 

Fax No.:212-251-3279

Attn: Jonathan D'Orsi, COO
	
400,000

	
6.
	
Fidelity Puritan Trust: Fidelity Low-Priced Stock Fund
	
82 Devonshire Street, Boston, MA 02109-3614

 

Fax No.: 617-850-8477

Attn: Diane Johnston
	
500,000

	
7.
	
UBS O’Connor LLC F/B/O: O’Connor Pipes Corporate Strategies Master Limited
	
One North Wacker Drive, 32nd Floor, Chicago, IL 60606

 

Fax No.: 312-525-6247

Attn: Robert A. Murray
	
100,000

	
8.
	
Newland Master Fund, Ltd.
	
350 Madison Avenue, 11th Floor, New York, NY 10017

 

Fax No.: 212-329-0770

Attn: Joseph Yankovich, CFO
	
394,886

	
9.
	
Advanced Series Trust - AST Academic Strategies Asset Allocation Portfolio
	
466 Lexington Avenue, New York, NY 10017

 

Fax No.:212-682-9831

Attn: Julian A. Bobb, Vice President and Corporate Counsel
	
147,059

	
10.
	
Jennison Small Company Fund, Inc.
	
466 Lexington Avenue, New York, NY 10017

 

Fax No.:212-682-9831

Attn: Julian A. Bobb, Vice President and Corporate Counsel
	
725,000

 

 

 

 

EXHIBIT A

 

SELLING STOCKHOLDERS

 

For additional information regarding the issuance of the common stock, see “Private Placement of Common Stock” above.  We are registering the shares of common stock in order to permit the selling stockholders to offer the shares for resale from time to time.  Except
for the ownership of the common stock issued pursuant to the Securities Purchase Agreement, the selling stockholders have not had any material relationship with us within the past three years.

 

The table below lists the selling stockholders and other information regarding the beneficial ownership of the shares of common stock by each of the selling stockholders.  The second column lists the number of shares of common stock beneficially owned by each selling stockholder,
based on its ownership of the common stock issued pursuant to the Securities Purchase Agreement, as of September 17, 2009.  The third column lists the shares of common stock being offered by this prospectus by the selling stockholders.  The fourth column assumes the sale of all of the shares offered by the selling stockholders pursuant to this prospectus.  The selling stockholders may sell all, some or none of their shares in this offering.  See “Plan
of Distribution.”

 

 

 

 

 

	
Name of Selling Stockholder
	
Number of Shares Beneficially 

Owned Prior to Offering
	
Maximum Number of Shares

to be Sold Pursuant 

to this Prospectus
	
Number of Shares 

Owned After Offering

	  	  	  	  
	  	  	  	  
	  	  	  	  
	
[Information to be provided by the Investors]

	  	  	  	  
	  	  	  	  
	  	  	  	  
	  	  	  	  

 

 

 

 

 

PLAN OF DISTRIBUTION

 

We are registering the shares of common stock to permit the resale of these shares of common stock by the selling stockholders from time to time after the date of this prospectus.  We will not receive any of the proceeds from the sale by the selling stockholders of the shares
of common stock.

 

The selling stockholders may sell all or a portion of the shares of common stock beneficially owned by them and offered hereby from time to time directly or through one or more underwriters, broker-dealers or agents.  If the shares of common stock are sold through underwriters
or broker-dealers, the selling stockholders will be responsible for underwriting discounts or commissions or agent’s commissions.  The shares of common stock may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices.  These sales may be effected in transactions, which may involve crosses or block transactions,

 

	
  
	
•
	
on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale;

 

	
  
	
•
	
in the over-the-counter market;

 

	
  
	
•
	
in transactions otherwise than on these exchanges or systems or in the over-the-counter market;

 

	
  
	
•
	
through the writing of options, whether such options are listed on an options exchange or otherwise;

 

	
  
	
•
	
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;

 

	
  
	
•
	
block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;

 

	
  
	
•
	
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;

 

	
  
	
•
	
an exchange distribution in accordance with the rules of the applicable exchange;

 

	
  
	
•
	
privately negotiated transactions;

 

	
  
	
•
	
short sales;

 

	
  
	
•
	
sales pursuant to Rule 144;

 

	
  
	
•
	
broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share;

 

 

 

 

 

	
  
	
•
	
a combination of any such methods of sale; and

 

	
  
	
•
	
any other method permitted pursuant to applicable law.

 

If the selling stockholders effect such transactions by selling shares of common stock to or through underwriters, broker-dealers or agents, such underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions or commissions from the selling stockholders
or commissions from purchasers of the shares of common stock for whom they may act as agent or to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers or agents may be in excess of those customary in the types of transactions involved).  In connection with sales of the shares of common stock or otherwise, the selling stockholders may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the
shares of common stock in the course of hedging in positions they assume.  The selling stockholders may also sell shares of common stock short and deliver shares of common stock covered by this prospectus to close out short positions and to return borrowed shares in connection with such short sales.  The selling stockholders may also loan or pledge shares of common stock to broker-dealers that in turn may sell such shares.

 

The selling stockholders may pledge or grant a security interest in some or all of the warrants or notes owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of common stock from time to time
pursuant to this prospectus or any amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act of 1933, as amended, amending, if necessary, the list of selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus.  The selling stockholders also may transfer and donate the shares of common stock in other circumstances in which case the transferees, donees, pledgees or other successors in
interest will be the selling beneficial owners for purposes of this prospectus.

 

At the time a particular offering of the shares of common stock is made, a prospectus supplement, if required, will be distributed which will set forth the aggregate amount of shares of common stock being offered and the terms of the offering, including the name or names of any broker-dealers
or agents, any discounts, commissions and other terms constituting compensation from the selling stockholders and any discounts, commissions or concessions allowed or reallowed or paid to broker-dealers.

 

Under the securities laws of some states, the shares of common stock may be sold in such states only through registered or licensed brokers or dealers.  In addition, in some states the shares of common stock may not be sold unless such shares have been registered or qualified
for sale in such state or an exemption from registration or qualification is available and is complied with.

 

There can be no assurance that any selling stockholder will sell any or all of the shares of common stock registered pursuant to the registration statement, of which this prospectus forms a part.

 

 

 

 

 

The selling stockholders and any other person participating in such distribution will be subject to applicable provisions of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, including, without limitation, to the extent applicable, Regulation
M of the Exchange Act, which may limit the timing of purchases and sales of any of the shares of common stock by the selling stockholders and any other participating person.  To the extent applicable Regulation M may also restrict the ability of any person engaged in the distribution of the shares of common stock to engage in market-making activities with respect to the shares of common stock.  All of the foregoing may affect the marketability of the shares of common stock and the ability
of any person or entity to engage in market-making activities with respect to the shares of common stock.

 

We will pay all expenses of the registration of the shares of common stock pursuant to the registration rights agreements, estimated to be $[     ] in total, including, without limitation, Securities and Exchange Commission filing fees and expenses of compliance
with state securities or “blue sky” laws; provided, however, that a selling stockholder will pay all underwriting discounts and selling commissions, if any.  We will indemnify the selling stockholders against liabilities, including some liabilities under the Securities Act, in accordance with the registration rights agreements, or the selling stockholders will be entitled to contribution.  We may be indemnified by the selling stockholders against civil liabilities, including liabilities
under the Securities Act, that may arise from any written information furnished to us by the selling stockholder specifically for use in this prospectus, in accordance with the related registration rights agreements, or we may be entitled to contribution.

 

Once sold under the registration statement, of which this prospectus forms a part, the shares of common stock will be freely tradable under the Securities Act in the hands of persons other than our affiliates.

 

 

 

 

EXHIBIT B

FORM OF NOTICE OF EFFECTIVENESS

OF REGISTRATION STATEMENT

[Transfer Agent]

[Address]

Attention:

Re:           Vitran Corporation Inc.

Ladies and Gentlemen:

[We are][I am] counsel to Vitran Corporation Inc., a corporation formed under the laws of Ontario, Canada (the “Company”), and have represented the Company in connection with that certain Securities Purchase Agreement
(the “Securities Purchase Agreement”) entered into by and among the Company and the buyers named therein (collectively, the “Holders”) pursuant to which the Company issued to the Holders shares of its common stock (the “Shares”).  Pursuant to the Securities Purchase Agreement, the Company also has entered
into a Registration Rights Agreement with the Holders (the “Registration Rights Agreement”) pursuant to which the Company agreed, among other things, to register the common stock under the Securities Act of 1933, as amended (the “Securities Act”).  In connection with the Company’s obligations under the Registration Rights Agreement, on ____________ ___, 20 ,
the Company filed a Registration Statement on Form S-3 (File No. 333-_____________) (the “Registration Statement”) with the Securities and Exchange Commission (the “SEC”) relating to the Shares, which Registration Statement names each of the Holders as a selling stockholder thereunder.

 

In connection with the foregoing, [we][I] advise you that a member of the SEC’s staff has advised [us][me] by telephone that the SEC has entered an order declaring the Registration Statement effective under the Securities Act at [ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF
EFFECTIVENESS] and [we][I] have no knowledge, after telephonic inquiry of a member of the SEC’s staff, that any stop order suspending its effectiveness has been issued or that any proceedings for that purpose are pending before, or threatened by, the SEC and the Shares are available for resale under the Securities Act pursuant to the Registration Statement unless we have delivered to you notice in writing that the Registration Statement has ceased to be effective for any reason.

 

 

 

 

 

This letter shall serve as our standing opinion to you that the Shares are freely transferable by the Holders pursuant to the Registration Statement.  You need not require further letters from us to effect any future legend-free issuance or reissuance of the Shares to the
Holders as contemplated by the Company’s Irrevocable Transfer Agent Instructions dated ________ __, 2009.

 

                      Very
truly yours,

 

 

 

 

                      By:_____________________

 

CC:           [LIST NAMES OF HOLDERS]

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