Document:

Exhibit 10.33

Exhibit 10.33

INTERNATIONAL FLAVORS & FRAGRANCES INC.

DEFERRED COMPENSATION PLAN

As Amended and Restated February 2, 2010

1. Purpose. The purpose of this Deferred Compensation Plan (the “Plan”) is to provide to
members of a select group of management or highly compensated employees of International Flavors &
Fragrances Inc. (the “Company”) and its subsidiaries and/or its affiliates who are selected for
participation in the Plan, and non-employee directors of the Company, a means to defer receipt of
specified portions of compensation and to have such deferred amounts treated as if invested in
specified investment vehicles, in order to enhance the competitiveness of the Company’s executive
compensation program and, therefore, its ability to attract and retain qualified key personnel
necessary for the continued success and progress of the Company, and to encourage such persons to
retain a significant equity stake in the Company.

2. Definitions. In addition to the terms defined in Section 1 above, the following terms
used in the Plan shall have the meanings set forth below:

(a) “Administrator” means the officer or committee of officers of the Company designated by
the Committee to administer the Plan. At October 8, 2007, the Administrator shall be the Company’s
administrative committee, the current members of which are the Executive Vice President, Global
Business Development; the Executive Vice President, Global Operations; the Senior Vice President
and Chief Financial Officer; the Senior Vice President and General Counsel; and the Vice President,
Human Resources of the Company. The full Committee may perform any function of the Administrator
hereunder, in which case the term “Administrator” shall refer to the Committee.

(b) “Beneficiary” means any family member or members, including by marriage or adoption, any
trust in which the Participant or any family member or members have more than 50% of the beneficial
interest, any foundation in which the Participant or any family member or members control the
management of assets, and any other entity in which the Participant or any family member or members
own more than 50% of the voting interests, in each case designated by the Participant in his or her
most recent written Beneficiary designation filed with the Committee as entitled to exercise rights
or receive benefits under the Plan in connection with the Participant’s Deferral Account (or any
portion thereof), or if there is no surviving designated Beneficiary, then the person, persons,
trust or trusts entitled by will or the laws of descent and distribution to exercise rights or
receive benefits under the Plan in connection with the Participant’s Deferral Account on behalf or
in lieu of such non-surviving designated Beneficiary.

(c) “Board” or “Board of Directors” means the Board of Directors of the Company.

(d) “Cash Deferral” means that portion of the assets of a Participant’s Deferral Account
which is attributable to cash-based deferrals made by Participant and investment results earned (or
lost) thereon.

(e) “Code” means the Internal Revenue Code of 1986, as amended. References to any provision
of the Code or regulation (including a proposed regulation) thereunder shall include any successor
provisions or regulations and applicable Internal Revenue Service guidance.

(f) “Committee” means the Compensation Committee of the Board of Directors or such other
committee designated under Section 3(b), to which the Board has delegated the authority to take
action under the Plan. The full Board may perform any function of the Committee hereunder, in
which case the term “Committee” shall refer to the Board.

 

 

 

(g) “Deferral Account” means the account or subaccount established and maintained by the
Company for specified deferrals by a Participant, as described in Section 6. Deferral Accounts
will be maintained solely as bookkeeping entries by the Company to evidence unfunded obligations of
the Company.

(h) “Deferred Stock” means a credit to the Participant’s Deferral Account representing the
right to receive one share of Stock for each share of Deferred Stock so credited, together with
rights to dividend equivalents and other rights and limitations specified in the Plan.

(i) “Disability” means a disability entitling the Participant to long-term disability
benefits under the Company’s long-term disability plan as in effect at the date of Participant’s
termination of employment. “409A Disability” has the meaning defined in Section 13(b)(ii).

(j) “Exchange Act” means the Securities Exchange Act of 1934, as amended. References to any
provision of the Exchange Act or rule thereunder shall include any successor provisions or rules.

(k) “409A Deferral” means a Cash Deferral or Deferred Stock resulting from a deferral of
compensation within the meaning of Code Section 409A in 2005 or later. For this purpose, if a
deferral of compensation was initiated before 2005 but either the Participant’s legal right to
receive the compensation arose in 2005 or later or his or her risk of forfeiture with respect to
the compensation lapsed in 2005 or later, it will be considered a 409A Deferral. The foregoing
notwithstanding, any deferral that qualifies for the short-term deferral exception under Treasury
Regulation § 1.409A-1(b)(4) shall not be deemed to be a 409A Deferral.

(l) “Grandfathered Deferral” means a Cash Deferral or Deferred Stock that would constitute a
409A Deferral except for the fact that the legal right to the deferral and any vesting occurred
before 2005.

(m) “Matching Account” means the subaccount under a Participant’s Deferral Account which
reflects Matching Contributions under the Plan and amounts of hypothetical income and appreciation
and depreciation in value of such subaccount.

(n) “Matching Contributions” means contributions to a Participant’s Matching Account made in
accordance with Section 7.

(o) “Participant” means any employee of the Company or any subsidiary or affiliate who is
designated by the Committee as eligible to participate and who participates or makes an election to
participate in the Plan, or any non-employee director of the company who participates or makes an
election to participate in the Plan.

(p) “Prior Plan Deferrals” means deferrals of annual incentive awards payable under the
International Flavors & Fragrances Inc. Management Incentive Compensation Plan and the
International Flavors & Fragrances Inc. Special Executive Bonus Plan and deferrals by non-employee
directors of the Company under the International Flavors & Fragrances Inc. Directors’ Deferred
Compensation Plan.

(q) “Retirement” means a Participant’s voluntary termination of employment (i) at or after
attaining age 62, (ii) at or after attaining age 55 with at least ten years of service to the
Company and its subsidiaries and affiliates (including any service to predecessor companies
acquired by the Company or its subsidiaries or affiliates) or (iii), in the case of a non-employee
director of the Company, any termination of service as a director.

(r) “Stock” means the Company’s Common Stock or any other equity securities of the Company
designated by the Administrator.

 

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(s) “Stock Units” or “Units” means stock unit awards granted under the Company’s 2000 Stock
Award and Incentive Plan, 2000 Supplemental Stock Award Plan, or other Company plans.

(t) “Trust” means any trust or trusts established by the Company as part of the Plan;
provided, however, that the assets of such trusts shall remain subject to the claims of the general
creditors of the Company.

(u) “Trustee” means the trustee of a Trust.

(v) “Trust Agreement” means the agreement entered into between the Company and the Trustee to
carry out the purposes of the Plan, as amended or restated from time to time.

(w) “Valuation Date” means the close of business on the last business day of each calendar
quarter; provided, however, that in the case of termination of employment for reasons other than
Retirement, death, or Disability, the Valuation Date means the close of business on the last
business day of the year in which employment terminates, unless otherwise determined by the
Administrator in the case of a Grandfathered Deferral.

3. Administration.

(a) Authority. The Committee shall administer the Plan in accordance with its terms, and
shall have all powers necessary to accomplish such purpose, including the power and authority to
construe and interpret the Plan, to define the terms used herein, to prescribe, amend and rescind
rules and regulations, agreements, forms, and notices relating to the administration of the Plan,
to make all other determinations necessary or advisable for the administration of the Plan, and to
determine whether to terminate participation of and accelerate distributions to Participants
(subject to Section 13, including Section 13(a)(iv)), including Participants who engage in
activities competitive with or not in the best interests of the Company. The Administrator shall
share in these powers, to the extent provided herein and subject to such limitations imposed by and
oversight of the Committee. Any actions of the Committee and Administrator with respect to the
Plan and determinations in all matters hereunder shall be conclusive and binding for all purposes
and upon all persons, including the Company, Participants, employees, and non-employee directors
(in their individual capacities) and their respective successors in interest (subject to the
Board’s and Committee’s reserved authority hereunder).

(b) Service on Committee or as Administrator. Members of the Committee shall be appointed by
and remain in office at the will of, and may be removed with or without cause by, the Board.
Persons serving as the Administrator shall be appointed by and remain in office at the will of, and
may be removed with or without cause by, the Committee. Any member of the Committee or
Administrator may resign at any time. The Committee or Administrator may delegate administrative
and other functions under the Plan to officers or employees of the Company and its subsidiaries, or
other agents, except as limited by the Plan. No member of the Committee or Administrator shall be
entitled to act on or decide any matter relating solely to himself or herself or any of his or her
rights or benefits under the Plan. No bond or other security shall be required in connection with
the Plan of the Committee or the Administrator or any member thereof in any jurisdiction.

(c) Limitation of Liability. Each member of the Committee or Administrator shall be entitled,
in good faith, to rely or act upon any report or other information furnished to him or her by any
officer or other employee of the Company or any subsidiary or affiliate, the Company’s independent
certified public accountants, or any executive compensation consultant, legal counsel, or other
professional retained by the Company to assist in the administration of the Plan. To the maximum
extent permitted by law, no member of the Committee or Administrator, nor any person to whom duties
have been delegated under the Plan, shall be liable to any person for any
action taken or omitted in connection with the interpretation and administration of the Plan,
except for the willful misconduct or gross negligence of such member or person.

 

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4. Participation. The Committee shall determine those employees of the Company and its
subsidiaries and/or affiliates, from among the executives who qualify as a select group of
management or highly compensated employees, who will be eligible to participate in the Plan. Such
persons shall be notified of such eligibility by the Administrator. The Committee may limit
participation by otherwise eligible employees in its discretion, including, for example, for a
specified period following a Participant’s withdrawal from a Deferral Account under Section 8(f) or
(g). In addition, each non-employee director of the Company shall be eligible to participate in
the Plan.

5. Deferrals. To the extent authorized by the Committee and subject to Section 13, a
Participant may elect to defer compensation or awards which may be in the form of cash, Stock,
Stock-denominated awards or other property to be received from the Company or a subsidiary or
affiliate, including salary, annual bonus awards, long-term awards, retainer fees and meeting fees
payable to a non-employee director, and compensation payable under other plans and programs,
employment agreements or other arrangements, or otherwise, as may be provided under the terms of
such plans, programs and arrangements or as designated by the Committee. Stock-denominated awards
that the Committee may authorize for deferral include (i) Stock Units and (ii) shares issuable upon
exercise of stock denominated SARs, if such SARs are implemented as deferrals of compensation under
Code Section 409A rather than as stock rights exempt under Treasury Regulation § 1.409A-1(b)(5).
(All deferrals of shares under the Plan are referred to as Deferred Stock, including awards
originally denominated “restricted stock units”). The foregoing notwithstanding, an
employee-Participant may defer, with respect to a given year, receipt of only that portion of the
Participant’s salary, annual bonus award, long-term award, equity awards and compensation payable
under other plans and programs, employment agreements or other arrangements that exceeds the FICA
maximum taxable wage base plus the amount necessary to satisfy Medicare and all other payroll taxes
(other than Federal, state or local income tax withholding) imposed on the wages or compensation of
such Participant from the Company and its subsidiaries and affiliates; this limitation shall not
apply to non-employee directors, however. In addition to such limitation, and any terms and
conditions of deferral set forth under plans, programs or arrangements from which receipt of
compensation or awards is deferred, the Administrator may impose limitations on the amounts
permitted to be deferred and other terms and conditions on deferrals under the Plan. Any such
limitations, and other terms and conditions of deferral, shall be specified in documents setting
forth terms and conditions of deferrals under the Plan, rules relating to the Plan or election
forms, other forms, or instructions published by or at the direction of the Administrator. The
Committee may permit awards and other amounts to be treated as deferrals under the Plan, including
deferrals that may be mandatory as determined by the Committee in its sole discretion or under the
terms of another plan or arrangement of the Company, for administrative convenience or otherwise to
serve the purposes of the Plan and such other plan or arrangement.

(a) Elections. Once an election form, properly completed, is received by the Company, the
elections of the Participant shall be irrevocable; provided, however, that the Administrator may in
its discretion determine that elections are revocable until the deadline specified for the filing
of such election; provided further, that the Administrator may, in its discretion, permit a
Participant to elect a further deferral of amounts credited to a Deferral Account by filing a later
election form; and provided, further, that, unless otherwise approved by the Administrator for
Grandfathered Deferrals only (any such approval must be consistent with policies of the
Administrator established prior to October 4, 2004), any election to further defer amounts credited
to a Deferral Account must be made at least one year prior to the date such amounts would otherwise
be payable, except as permitted under Section 13(a)(ii) and subject to Section 5(b).

 

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(b) Date of Election. A Participant’s election to defer compensation or awards hereunder must
be received by the Administrator prior to the date specified by or at the direction of the
Administrator. Under no circumstances may a Participant defer compensation or awards to which the
Participant has attained, at the time of deferral, a legally enforceable right to current receipt
of such compensation or awards.

	 	(i)	 	Initial Deferral Elections. In the case of 409A Deferrals not settled in
2007 or earlier, any initial election to defer compensation (including the election as
to the type and amount of compensation to be deferred and the time and manner of
settlement of the deferral) must be made (and shall be irrevocable) no later than
December 31 of the year before the Participant’s services are performed which will
result in the earning of the compensation, except as follows:

	 	•	 	Initial deferral elections with respect to compensation that,
absent the election, constitutes a short-term deferral may be made in
accordance with Treasury Regulation § 1.409A-2(a)(4) and (b);
	 
	 	•	 	Initial deferral elections with respect to compensation that
remains subject to a requirement that the Participant provide services for at
least 12 months (a “forfeitable right” under Treasury Regulation §
1.409A-2(a)(5)) may be made on or before the 30th day after the
Participant obtains the legally binding right to the compensation, provided
that the election is made at least 12 months before the earliest date at which
the forfeiture condition could lapse and otherwise in compliance with Treasury
Regulation § 1.409A-2(a)(5);
	 
	 	•	 	Initial deferral elections by a Participant in his or her
first year of eligibility may be made within 30 days after the date the
Participant becomes eligible to participate in the Plan, with respect to
compensation paid for services to be performed after the election and in
compliance with Treasury Regulation § 1.409A-2(a)((7);
	 
	 	•	 	Initial deferral elections by a Participant with respect to
performance-based compensation (as defined under Treasury Regulation §
1.409A-1(e)) may be made on or before the date that is six months before the
end of the performance period, provided that (i) the Participant was employed
continuously from either the beginning of the performance period or the later
date on which the performance goal was established, (ii) the election to defer
is made before such compensation has become readily ascertainable (i.e.,
substantially certain to be paid), (iii) the performance period is at least 12
months in length and the performance goal was established no later than 90
days after the commencement of the service period to which the performance
goal relates, (iv) the performance-based compensation is not payable in the
absence of performance except due to death, disability, a 409A Change in
Control or as otherwise permitted under Treasury Regulation § 1.409A-1(e), and
(v) this initial deferral election must in any event comply with Treasury
Regulation § 1.409A-2(a)(8);
	 
	 	•	 	Initial deferral elections resulting in Matching
Contributions under Section 7 may be made in compliance with Treasury
Regulation § 1.409A-2(a)(9);
	 
	 	•	 	Initial deferral elections may be made to the fullest
permitted under other applicable provisions of Treasury Regulation §
1.409A-2(a); and
	 
	 	•	 	Initial deferral elections in 2007 and earlier may be made to
the fullest extent authorized under transition rules and other applicable
guidance under Code Section 409A.

 

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	 	(ii)	 	Further Deferral Elections. Elections to further defer The foregoing
notwithstanding, for 409A Deferrals not settled in 2007 or earlier, any further
deferral election made in 2008 or later shall be subject to the following:

	 	•	 	The further deferral election will not take effect until at
least 12 months after the date on which the election is made;
	 
	 	•	 	If the election relates to a distribution event other than a
409A Disability, death, or Unforeseeable Emergency, the payment with respect
to which such election is made must be deferred for a period of not less than
five years from the date such payment would otherwise have been paid (or in
the case of a life annuity or installment payments treated as a single
payment, five years from the date the first amount was scheduled to be paid);
	 
	 	•	 	The requirement that the further deferral election be made at
least 12 months before such 409A Deferrals would be first payable may not be
waived by the Administrator, and shall apply to a payment at a specified time
or pursuant to a fixed schedule (and in the case of a life annuity or
installment payments treated as a single payment, 12 months before the date
that the first amount was scheduled to be paid);
	 
	 	•	 	The further deferral election shall be irrevocable when filed
with the Company; and
	 
	 	•	 	The further deferral election otherwise shall comply with the
applicable requirements of Treasury Regulation § 1.409A-2(b).

6. Deferral Accounts. Deferral Accounts shall be subject to the provisions of this Section
6. With respect to 409A Deferrals not settled in 2007 or earlier, the provisions of this Section 6
are subject to Section 13, and for such 409A Deferrals and Grandfathered Deferrals the provisions
of this Section 6 are subject to Section 13(e), which generally precludes any action (including in
the discretion of the Administrator) relating to the timing or amount of deferred compensation and
earnings to be credited thereon that would provide a rate of return exceeding that of a
predetermined actual investment, as specified under Treasury Regulation § 1.409A-1(o).

(a) Establishment; Crediting of Amounts Deferred. One or more Deferral Accounts will be
established for each Participant, as determined by the Administrator. The amount of compensation
or awards deferred with respect to each Deferral Account will be credited to such Account as of the
date on which such amounts would have been paid to the Participant but for the Participant’s
election to defer receipt hereunder, unless otherwise determined by the Administrator. With
respect to any fractional shares of Stock or Stock-denominated awards, the Administrator shall
determine whether to credit the Deferral Account with a fraction of a share, to pay cash in lieu of
the fractional share or carry forward such cash amount under the Plan, round to the nearest whole
share, round to the next whole share, or round down to eliminate the fractional share or otherwise
make provision for the fractional share. Amounts of hypothetical income and appreciation and
depreciation in value of such account will be credited and debited to, or otherwise reflected in,
such Account from time to time. Unless otherwise determined by the Administrator (including under
Section 6(e)), Cash Deferrals shall be deemed invested in a hypothetical investment as of the date
of deferral.

	 	(b)	 	Investment Vehicles.

	 	(i)	 	Subject to the provisions of this Section 6(b) and Sections 6(d) and 9, Cash
Deferral amounts shall be deemed to be invested, at the Participant’s direction, in
one or more investment vehicles as may be specified from time to time by the
Committee; provided, however, that the Administrator may expressly reserve the right
to approve or disapprove any investment direction given by a Participant. The
Committee may, but is not required to, permit Cash Deferrals to be deemed invested in
Deferred Stock, subject to Section 11. The Committee may change or discontinue any
hypothetical investment vehicle available under the Plan in its discretion (subject to
Section 13(e)); provided, however, that each affected Participant shall be given the
opportunity, without limiting or otherwise impairing any other right of such
Participant regarding changes in investment directions, to
redirect the allocation of his or her Cash Deferral amount deemed invested in the
discontinued investment vehicle among the other hypothetical investment vehicles,
including any replacement vehicle.

 

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	 	(ii)	 	Amounts credited as Deferred Stock to a Participant’s Deferral Account
(whether or not as a result of a Cash Deferral) may not be reallocated or deemed
reinvested in any other investment vehicle, but shall remain as Deferred Stock until
such time as the Deferral Account is settled in accordance with Section 8.
	 
	 	(iii)	 	Subject to Sections 11 and 13(e), the Committee may provide for crediting of
additional Deferred Stock as a premium or inducement to Participants to elect
deferrals that will be credited as Deferred Stock; provided, however, that the
crediting of any such additional Deferred Stock on deferrals by non-employee directors
shall be subject to approval of the Board. Such additional Deferred Stock shall not
exceed 40% of the number of shares of Deferred Stock resulting from the Participant’s
deferral. Such additional Deferred Stock shall be subject to such vesting and
forfeiture conditions as the Committee may specify.

(c) Dividend Equivalents and Adjustments. Deferred Stock credited to a Participant’s Deferral
Account will be credited with Dividend Equivalents and subject to adjustment as provided in this
Section 6(c), except as limited by the Committee and in any event such crediting will not apply to
any amount that remains subject to a substantial risk of forfeiture unless explicitly authorized by
the Committee:

	 	(i)	 	Cash Dividends. If the Company declares and pays a cash dividend on Stock,
then a number of additional shares of Deferred Stock shall be credited to a
Participant’s Deferral Account as of the payment date for such dividend equal to (A)
the number of shares of Deferred Stock credited to the Deferral Account as of the
record date for such dividend, multiplied by (B) the amount of cash actually paid as a
dividend on each share at such payment date, divided by (C) the fair market value of a
share of Stock at such payment date. The Administrator shall determine how amounts
that would be credited or settled as fractional shares shall be treated under the Plan
in accordance with Section 6(a) hereof.
	 
	 	(ii)	 	Non-Stock Dividends. If the Company declares and pays a dividend on Stock in
the form of property other than shares of Stock, then a number of additional shares of
Deferred Stock shall be credited to a Participant’s Deferral Account as of the payment
date for such dividend equal to (A) the number of shares of Deferred Stock credited to
the Deferral Account as of the record date for such dividend, multiplied by (B) the
fair market value of any property other than shares actually paid as a dividend on
each share at such payment date, divided by (C) the fair market value of a share of
Stock on the day after such payment date. The Administrator shall determine how
amounts that would be credited or settled as fractional shares shall be treated under
the Plan in accordance with Section 6(a) hereof.
	 
	 	(iii)	 	Stock Dividends and Splits. If the Company declares and pays a dividend on
Stock in the form of additional shares of Stock, or there occurs a forward split of
Stock, then a number of additional shares of Deferred Stock shall be credited to
Participant’s Deferral Account as of the payment date for such dividend or forward
Stock split equal to (A) the number of shares of Deferred Stock credited to the
Deferral Account as of the record date for such dividend or split, multiplied by (B)
the number of additional shares actually paid as a dividend or issued in such split in
respect of each share of Stock. The Administrator shall determine how amounts that
would be credited or settled as fractional shares shall be treated under the Plan in
accordance with Section 6(a) hereof.

 

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	 	(iv)	 	Modifications to Dividend Equivalents Policy. Other provisions of this
Section 6(c) notwithstanding, the Administrator may modify the manner of payment or
crediting of Dividend Equivalents hereunder, in order to coordinate the value of
Deferral Accounts with any trust holding shares established under Section 6(e), for
administrative convenience, or for any other reason.
	 
	 	(v)	 	Adjustments. The number of shares of Deferred Stock credited to the
Participant’s Account may be adjusted by the Committee in order to prevent dilution or
enlargement of Participants’ rights with respect to Deferred Stock, in the event of
any unusual corporate transaction or event which affects the value of Common Stock,
provided that any such adjustment shall be made taking into account any crediting of
Deferred Stock to the Participant under other provisions of this Section 6(c) in
connection with such transaction or event.

(d) Allocation and Reallocation of Hypothetical Investments. A Participant may allocate the
Cash Deferral portion of his or her Deferral Account to one or more of the hypothetical investment
vehicles authorized under the Plan. Subject to Section 6(b)(ii) and any rules established by the
Administrator, a Participant may reallocate such Cash Deferrals as of the Valuation Date or other
date specified by the Administrator at or following the filing of Participant’s reallocation
election to one or more of such hypothetical investment vehicles, by filing with the Administrator
a notice (the reallocation election) in such form as may be specified by the Administrator. The
Administrator may, in its discretion, restrict allocation into or reallocation by specified
Participants into or out of specified investment vehicles or specify minimum or maximum amounts
that may be allocated or reallocated by Participants.

(e) Trusts. The Administrator may, in its discretion, establish one or more Trusts (including
sub-accounts under such Trust(s)), and deposit therein amounts of cash, Stock, or other property in
connection with the Company’s obligations with respect to a Participant’s Deferral Account
established under this Section 6. If so determined by the Administrator in any case in which the
amounts deposited represent the economic equivalent of the Participant’s deemed investment in his
or her Deferral Account, the amounts of hypothetical income and appreciation and depreciation in
value of such Deferral Account shall be equal to the actual income on, and appreciation and
depreciation of, the assets in such Trust(s) (net of any investment, management or other fees or
costs, as may be specified by the Administrator). Other provisions of this Section 6
notwithstanding, the timing of allocations and reallocations of assets in such a Deferral Account,
and the investment vehicles available with respect to the Cash Deferral portion of the Deferral
Account, may be varied to reflect the timing of actual investments of the assets of such Trust(s)
and the actual investments available to such Trust(s). Assets deposited in such Trust may not be
paid out to the Company, except to the extent that (i) such assets are held by the Trust in
connection with the Deferral Account of a specified Participant and the Company has made payments
in settlement of such Participant’s Deferral Account, (ii) the assets of the Trust exceed the
deferred compensation liabilities of the Company under the Plan by more than 25% of the amount of
such deferred compensation liabilities, or (iii) a creditor of the Company may attach the assets of
the Trust, consistent with the status of Trust as a “rabbi” trust. Any such trust shall be
domiciled in the United States, and may not include any term that would provide for a change in
trust terms restricting access to the funds thereon based on the financial condition of the
Company.

(f) Restrictions on Participant Direction. The provisions of Section 6(b), 6(d), and 7(c)
notwithstanding, the Administrator may restrict or prohibit reallocations of amounts deemed
invested in specified investment vehicles, and subject such amounts to a risk of forfeiture and
other restrictions, in order to conform to restrictions applicable to Stock, a Stock-denominated
award, or any other award or amount deferred under the Plan and resulting in such deemed
investment, to comply with any applicable law or regulation, or for such other purpose as the
Administrator may determine is not inconsistent with the Plan.

 

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7. Company Matching Contributions.

(a) Amount of Matching Contributions To Be Credited. With respect to each
employee-Participant who makes Cash Deferrals under this Plan in a calendar year, the Company
shall, on its books, credit a Matching Contribution to such Participant’s Matching Account as
described in this Section 7. The amount of Matching Contribution the Company shall credit to a
Participant in a calendar year shall be equal to the results of (i) minus (ii), as follows:

	 	(i)	 	the amount of the Company’s matching contributions which were actually made
and which would have been made on behalf of the Participant under the Retirement
Investment Fund Plan (the “RIFP”), determined on the basis of the Participant’s actual
“pre-tax contributions” and “after-tax contributions” (as those terms are defined
under the RIFP), plus the amount of Company matching contributions which would have
been made on account of the Participant’s Cash Deferrals in such calendar year if such
Cash Deferrals had instead been contributions by the Participant to the RIFP for the
plan year and disregarding any reduction in Company matching contributions required
under the RIFP due to the application of the limitations set forth in Section
401(a)(17), 401(k), 401(m), 402(g), and 415 of the Internal Revenue Code (the
“Statutory Limitations”), minus
	 
	 	(ii)	 	the amount of Company matching contributions that were made by the Company on
behalf of a Participant under the RIFP for such plan year and allocated to the
Participant’s accounts under the RIFP.

Matching Contributions are subject to any limitation or maximum imposed under the RIFP apart from
the Statutory Limitations, and the Committee may in its discretion further limit Matching
Contributions under the Plan (but Participants shall be given notice of any such further limitation
prior to the effectiveness of an irrevocable deferral election that would be affected thereby).

(b) Time of Crediting of Matching Contributions. The Matching Contributions with respect to a
Participant pursuant to (a) above shall be credited to the Participant’s Matching Account at the
same times as like matching contributions would have been credited to the Participant’s matching
account under the RIFP.

(c) Vesting of Matching Account; Other Plan Rules Applicable. Matching Contributions on
behalf of a Participant and the Participant’s Matching Account shall be subject to the vesting
rules and risks of forfeiture that would have applied to like matching contributions to the
Participant and the Participant’s matching account under the RIFP. In other respects, such
Matching Contributions and Matching Account shall be subject to the same rules, applied separately,
as the rules that apply to the Participant’s Cash Deferrals and Deferral Account under the Plan.

8. Settlement of Deferral Accounts.

(a) Form of Payment. The Company shall settle a Participant’s Deferral Account, and discharge
all of its obligations to pay deferred compensation under the Plan with respect to such Deferral
Account, as follows:

	 	(i)	 	with respect to Cash Deferrals, payment of cash or, in the discretion of the
Administrator, by delivery of other liquid assets (including Stock) having a fair
market value equal to the Cash Deferral amount credited to the Deferral Account;
provided, however, that, to the extent practicable, any assets delivered in settlement
of Cash Deferrals shall be of the same type or kind as the investment
vehicle in which those Cash Deferrals were deemed invested at the time of
settlement; or

 

9

 

	 	(ii)	 	with respect to Stock based deferral amounts, by delivery of shares of Stock,
including shares of Stock delivered out of the assets of the Trust.

(b) Forfeitures Under Other Plans and Arrangements. To the extent that Stock or any other
award or amount (i) is deposited in a Trust pursuant to Section 6 in connection with a deferral of
Stock, a Stock-denominated award, or any other award or amount under another plan, program,
employment agreement or other arrangement, or otherwise is deemed to be deferred under the Plan
without such a deposit, and (ii) is forfeited pursuant to the terms of such plan, program,
agreement or arrangement, the Participant shall not be entitled to the value of such Stock and
other property related thereto (including without limitation, dividends and distributions thereon)
or other award or amount, or proceeds thereof. Any Stock or Stock-denominated awards, other
property or other award or amount (and proceeds thereof) forfeited shall be returned to the
Company.

(c) Timing of Payments.

	 	(i)	 	Generally, the Administrator shall determine minimum and maximum deferral
periods and any limitations on terms of deferrals (such as number of installments and
periods over which installments will be paid), provided that any terms permitting
settlement more than ten years after the date of a Participant’s termination of
employment with the Company and its subsidiaries must be approved by the Committee.
Subject to these limitations, payments in settlement of a Deferral Account shall be
made as soon as practicable after the date or dates (including upon the occurrence of
specified events), and in such number of installments, as may be directed by the
Participant in his or her election relating to such Deferral Account, provided that,
except with respect to Prior Plan Deferrals (the timing of settlement of which, in
each case, shall be determined in accordance with the terms of Section 8(c)(ii)
hereof) or as otherwise determined by the Administrator, in the event of termination
of employment for reasons other than Retirement, death, or 409A Disability in the case
of 409A Deferrals or Disability in the case of other deferrals, a single lump sum
payment in settlement of any Deferral Account (including a Deferral Account with
respect to which one or more installment payments have previously been made) shall be
made as promptly as practicable following the next Valuation Date, unless otherwise
determined by the Administrator in the case of Grandfathered Deferrals (but not 409A
Deferrals) in an exercise of discretion consistent with policies implemented before
October 4, 2004; and provided further, that payments in settlement of a Deferral
Account will be made in accordance with Section 8(d) in the event of a Change in
Control.
	 
	 	(ii)	 	On or before June 1, 2001, each Participant who has Prior Plan Deferrals,
shall be required to make a new election with respect to the timing of settlement of
his or her Prior Plan Deferrals (including earnings thereon). Specifically, each such
Participant shall make a single election which shall be applicable to all of his or
her Prior Plan Deferrals (including earnings thereon), to have (1) payments made in a
number of installments which is not less than the least number, and not greater than
the greatest number, of installments previously elected by the Participant with
respect to any such Prior Plan Deferral and (2) payment commence on a date that occurs
no sooner than the earliest and no later than the latest payment commencement date
previously elected by such Participant with respect to any such Prior Plan Deferral.
In the event a Participant who has Prior Plan Deferrals does not make the foregoing
election on or before June 1, 2001, such Participant will be deemed to have elected to
have (1) payments
made in a number of installments equal to the least number of installments
previously elected by such Participant with respect to any such Prior Plan Deferral
and (2) payment commence on the earliest payment date previously elected by such
Participant with respect to any such Prior Plan Deferral.

 

10

 

(d) Change in Control. In the event of a “Change in Control,” as defined under Section 8(e),
the following provisions shall apply:

	 	(i)	 	All deferral periods relating to non-409A Deferrals will be automatically
accelerated to end at the time of the Change in Control and, if the event involves a
409A Change in Control, all deferral periods relating to 409A Deferrals will be
automatically accelerated to end at the time of the earliest 409A Change in Control,
and each Deferral Account, to the extent affected by such acceleration, will be
settled within five business days after the end of the deferral period, provided that
the Committee may accelerate this settlement (for all or specified parts of a Deferral
Account) in connection with a Change in Control or 409A Change in Control for any
reason, subject to applicable limitations under Section 13 (particularly Sections
13(a)(iv)(E) and 13(f)) and subject to such additional conditions as the Committee may
impose; provided, however, that, if so determined by the Committee (and subject to
Section 5(b)), the Participant may waive the accelerated settlement relating to
Grandfathered Deferrals provided under this Section 8(d)(i); and

	 	(ii)	 	At all times after the Change in Control, in addition to any trustee or other
fiduciary under the Plan and any Trust established hereunder, the individual serving
as the Chief Executive Officer of the Company immediately prior to the Change in
Control shall be a fiduciary with the full authority and the obligation to take any
required or appropriate action to cause the Company and any such Trust to pay amounts
in settlement and provide the benefits to the Participants in accordance with the Plan
and each Participant’s contractual rights thereunder.

(e) Definition of “Change in Control.” A “Change in Control” shall be deemed to have occurred
if, after the effective date of the Plan, there shall have occurred any of the following:

	 	(i)	 	Any “person,” as such term is used in Section 13(d) and 14(d) of the Exchange
Act (other than the Company, any trustee or other fiduciary holding securities under
an employee benefit plan of the Company, or any company owned, directly or indirectly,
by the shareholders of the Company in substantially the same proportions as their
ownership of stock of the Company), acquires voting securities of the Company and
immediately thereafter is a “40% Beneficial Owner.” For purposes of this provision, a
“40% Beneficial Owner” shall mean a person who is the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company representing 40% or more of the combined voting power of the Company’s
then-outstanding voting securities; provided, however, that the term “40% Beneficial
Owner” shall not include any person who was a beneficial owner of outstanding voting
securities of the Company at February 20, 1990, or any person or persons who was or
becomes a fiduciary of any such person or persons who is, or in the aggregate, are a
“40% Beneficial Owner” (an “Existing Shareholder”), including any group that may be
formed which is comprised solely of Existing Shareholders, unless and until such time
after February 20, 1990 as any such Existing Shareholder shall have become the
beneficial owner (other than by means of a stock dividend, stock split, gift,
inheritance or receipt or exercise of, or accrual of any right to exercise a stock
option granted by the Company or receipt or settlement of any other stock-related
award granted by the Company) by purchase of any additional voting securities of the Company; and provided
further, that the term “40% Beneficial Owner” shall not include any person who
shall become the beneficial owner of 40% or more of the combined voting power of
the Company’s then-outstanding voting securities solely as a result of an
acquisition by the Company of its voting securities, until such time thereafter as
such person shall become the beneficial owner (other than by means of a stock
dividend or stock split) of any additional voting securities and becomes a 40%
Beneficial Owner in accordance with this Section 8(e);

 

11

 

	 	(ii)	 	Individuals who on the effective date of the Plan constitute the Board, and
any new director (other than a director whose initial assumption of office is in
connection with an actual or threatened election consent, including but not limited to
a consent solicitation, relating to the election of directors of the Company) whose
election by the Board or nomination for election by the Company’s shareholders was
approved by a vote of at least two-thirds (2/3) of the directors then still in office
who either were directors on such effective date or whose election or nomination for
election was previously so approved or recommended, cease for any reason to constitute
at least a majority thereof;

	 	(iii)	 	There is consummated a merger, consolidation, recapitalization, or
reorganization of the Company, or a reverse stock split of any class of voting
securities of the Company, if, immediately following consummation of any of the
foregoing, either (A) individuals who, immediately prior to such consummation,
constitute the Board do not constitute at least a majority of the members of the board
of directors of the Company or the surviving or parent entity, as the case may be, or
(B) the voting securities of the Company outstanding immediately prior to such
recommendation do not represent (either by remaining outstanding or by being converted
into voting securities of a surviving or parent entity) at least 60% or more of the
combined voting power of the outstanding voting securities of the Company or such
surviving or parent entity; or

	 	(iv)	 	The shareholders of the Company have approved a plan of complete liquidation
of the Company or there is consummated an agreement for the sale or disposition by the
Company of all or substantially all of the Company’s assets (or any transaction have a
similar effect).

The term “409A Change in Control” is defined in Section 13(b)(i).

(f) Financial Emergency and Other Payments. Other provisions of the Plan (except Sections 9
and 13) notwithstanding, if, upon the written application of a Participant, the Administrator
determines that the Participant has a financial emergency of such a substantial nature, beyond the
Participant’s control, and as to which the Participant lacks other readily available assets that
could be used to timely address the emergency, so that payment of amounts previously deferred under
the Plan is warranted, the Administrator may direct the payment to the Participant of all or a
portion of the balance of a Deferral Account and the time and manner of such payment, provided,
however, that in the case of 409A Deferrals, payments under this Section 8(f) shall be authorized
and made only in the event of an Unforeseeable Emergency and subject to the terms of Section
13(a)(iv)(A).

(g) Voluntary Withdrawal With 10% Penalty. A Participant may voluntarily withdraw all or a
portion of the portion of his or her Deferral Account balance attributable to Grandfathered
Deferrals other than salary deferrals upon 30 days’ notice to the Administrator, subject to a
penalty equal to 10% of the amount withdrawn; provided, however, that the Participant shall have no
right to withdraw Deferred Stock under this Section 8(g) if the existence of such right would
result in “variable” accounting under APB 25 (as in effect at October 3, 2004) or in accounting for
such Deferred Stock as a “liability” under Statement of Financial Accounting Standards No. 123R
(or similar consequences under any successor accounting authority) with respect to any Deferred
Stock, if any withdrawal otherwise would result in adverse accounting or tax consequences to the
Company, or if such withdrawal is otherwise not approved by the Administrator. The amount of any
penalty under this Section 8(g) will be forfeited.

 

12

 

9. Provisions Relating to Section 16 of the Exchange Act and Section 162(m) of the Code.

(a) Avoidance of Liability Under Section 16. With respect to a Participant who is then
subject to the reporting requirements of Section 16(a) of the Exchange Act, the Administrator shall
implement transactions under the Plan and administer the Plan in a manner that will ensure that
each transaction by such a Participant is exempt from liability under Rule 16b-3 or otherwise will
not result in liability under Section 16(b) of the Exchange Act.

(b) Compliance with Code Section 162(m). It is the intent of the Company that any
compensation (including any award) deferred under the Plan by a person who is, with respect to the
year of payout, determined by the Administrator likely to be a “covered employee” within the
meaning of Code Section 162(m) and regulations thereunder, shall not, as a result of deferral
hereunder, become compensation with respect to which the Company would not be entitled to a tax
deduction under Code Section 162(m). Accordingly, unless otherwise determined by the Administrator
(with respect to Grandfathered Deferrals), if any payment in settlement of a Deferral Account would
be subject to a loss of deductibility by the Company at the a time of scheduled settlement
hereunder, the terms of such deferral shall be automatically modified to the extent necessary to
ensure that the compensation will be, at the time of settlement hereunder, fully deductible by the
Company. Any such modification to delay the settlement date of a 409A Deferral not settled in 2007
or earlier must conform to the requirements of Treasury Regulation § 1.409A-2(b)(7)(i).

10. Statements. The Administrator will furnish statements, at least once each calendar year,
to each Participant reflecting the amounts credited to a Participant’s Deferral Accounts,
transactions therein since the date reported on in the last previous statement, and other
information deemed relevant by the Administrator.

11. Sources of Stock; Shares Available for Delivery. Shares of Stock deliverable in
settlement of Deferred Stock, including shares deposited under the Plan in a Trust pursuant to
Section 6, in connection with a deferral of a Stock-denominated award granted or acquired under
another plan, program, employment agreement or other arrangement that provides for the issuance of
shares, shall be deemed to have originated, and shall be counted against the number of shares
reserved, under such other plan, program or arrangement. Shares of Stock actually delivered in
settlement of such deferral shall be originally issued shares or treasury shares in accordance with
the terms of such other plan, program or arrangement. In the case of shares deliverable in
connection with Deferred Stock credited in connection with Dividend Equivalents, or if the
Committee authorizes deemed investments in Deferred Stock by Participants deferring cash, any
shares to be deposited under the Plan in a Trust in connection with such deemed investments in
Deferred Stock or otherwise to be delivered in settlement of such Deferred Stock shall be solely
treasury shares or shares acquired in the market by or on behalf of the Trust. For this purpose, a
total of 450,000 treasury shares are hereby reserved for delivery in connection with such Deferred
Stock.

12. Amendment and Termination. The Committee may, with prospective or retroactive effect,
amend, alter, suspend, discontinue, or terminate the Plan at any time without the consent of
Participants, stockholders, or any other person; provided, however, that, without the consent of a
Participant, no such action shall materially and adversely affect the rights of such Participant
with respect to any rights to payment of amounts credited to such Participant’s Deferral Account.
The foregoing notwithstanding, subject to the restrictions under Section 13 (including restrictions
on Plan termination and accelerations under Sections 13(a)(iv)(E) and 13(f)), the Committee may
terminate the Plan (in whole or in part) and distribute to Participants (in whole or in part) the
amounts credited to his or her Deferral Accounts and reserves the right to accelerate the
settlement of any individual Participant’s Deferral Account (in whole or in part). The termination
of the Plan, and any amendment or alteration to the Plan that is beyond the scope of the authority
or the Committee, shall be subject to the approval of the Board of Directors.

 

13

 

13. Certain Limitations on Deferrals to Ensure Compliance with Code Section 409A.

(a) 409A Deferrals. Other provisions of the Plan notwithstanding, the terms of any 409A
Deferral, including any authority of the Company and rights of the Participant with respect to the
409A Deferral, shall be limited to those terms permitted under Section 409A, and any terms not
permitted under Code Section 409A shall be automatically modified and limited to the extent
necessary to conform with Section 409A and the regulations and guidance issued thereunder. The
following rules will apply to 409A Deferrals not settled in 2007 or earlier:

	 	(i)	 	Deferral Elections. A Participant’s election to defer compensation will be
permitted only at times in compliance with Code Section 409A, as specified in Section
5(b).
	 
	 	(ii)	 	Changes in Elections as to Distribution. The Administrator may, in its
discretion, require or permit on an elective basis a change in the distribution terms
applicable to such 409A Deferrals (and other deferrals, including other 409A Deferrals
and deferrals that are not 409A Deferrals because they qualify for the short-term
deferral exemption under Code Section 409A) during 2005 — 2007 in accordance with, and
to the fullest extent permitted by, applicable IRS guidance under Code Section 409A,
provided that any modifications to such deferrals or permitted election of different
deferral periods may not otherwise increase the benefits to a Participant or the costs
of such deferrals to the Company other than administrative costs, changes in value of
the deferral based on investment performance and indirect expense attributable to the
timing of receipt of taxable income and tax deductions.
	 
	 	(iii)	 	Settlement. Except as provided in Section 13(a)(iv) hereof, no such 409A
Deferral shall be settled except upon the occurrence of one of the following (or a
date related to the occurrence of one of the following), which must be specified in a
written election or other document governing such 409A Deferral and otherwise meet the
requirements of Treasury Regulation § 1.409A-3:

	 	(A)	 	Specified Time. A specified time or pursuant to a fixed
schedule.
	 
	 	(B)	 	Separation from Service. The Participant’s separation from
service (within the meaning of Treasury Regulation § 1.409A-1(h) and other
applicable rules under Code Section 409A); provided, however, that if the
Participant is a “key employee” (as defined in Code Section 416(i) without
regard to paragraph (5) thereof) and any of the Company’s Stock is publicly
traded on an established securities market or otherwise, settlement under this
Section 13(a)(iii)(B) may not be made before the date that is six months after
the date of separation from service.
	 
	 	(C)	 	Death. The death of the Participant.
	 
	 	(D)	 	Disability. The date the Participant has experienced a 409A
Disability, as defined below.

 

14

 

	 	(E)	 	409A Change in Control. The occurrence of a 409A Change in
Control, as defined below.

	 	(iv)	 	No Acceleration. The settlement of such a 409A Deferral may not be
accelerated prior to the time specified in Section 13(a)(iii) hereof, except the
Company may accelerate the settlement in the case of one of the following events:

	 	(A)	 	Unforeseeable Emergency. The occurrence of an Unforeseeable
Emergency, as defined below, but only if the net amount payable upon such
settlement does not exceed the amounts necessary to relieve such emergency
plus amounts necessary to pay taxes reasonably anticipated as a result of the
settlement, after taking into account the extent to which the emergency is or
may be relieved through reimbursement or compensation from insurance or
otherwise or by liquidation of the Participant’s other assets (to the extent
such liquidation would not itself cause severe financial hardship), or by
cessation of deferrals under the Plan. Upon a finding that an Unforeseeable
Emergency has occurred with respect to a Participant, any election of the
Participant to defer compensation that will be earned in whole or part by
services in the year in which the emergency occurred or is found to continue
will be immediately cancelled.
	 
	 	(B)	 	Domestic Relations Order. Settlement may be accelerated for
purposes of a settlement paid to an individual other than the Participant as
may be necessary to comply with the terms of a domestic relations order (as
defined in Code Section 414(p)(1)(B)).
	 
	 	(C)	 	Conflicts of Interest. Such 409A Deferral may permit the
acceleration of the settlement time or schedule as may be necessary to comply
with an ethics agreement with the Federal government or if reasonably
necessary to comply with a Federal, state, local or foreign ethics law or
conflict of interest law in compliance with Treasury Regulation §
1.409A-3(j)(4)(iii).
	 
	 	(D)	 	Other Accelerations. The Administrator may exercise the
discretionary right to accelerate the vesting of any unvested compensation
deemed to be such a 409A Deferral upon a 409A Change in Control or to
terminate the Plan upon or within 12 months after a 409A Change in Control, or
otherwise to the extent permitted under Treasury Regulation §
1.409A-3(j)(4)(ix), or accelerate settlement of such 409A Deferrals in any
other circumstance permitted under Treasury Regulation § 1.409A-3(j)(4).

	 	(v)	 	Timing of Distributions. The Administrator may permit distributions to occur
at any date related a permitted distribution event specified in Section 13(a)(iii),
and combinations thereof, and otherwise to the fullest extent permitted under Treasury
Regulation § 1.409A-3. In the case of any distribution of such a 409A Deferral “at a
specified time or pursuant to a fixed schedule” subject to Treasury Regulation §
1.409A-3(a)(4) and (j)(1), subject to any more restrictive timing rule contained in an
applicable deferral election or other governing document, the distribution shall be
made at a date (specified by the Company without control by the Participant) not later
than the fifteenth day of the third month following the date at which the settlement
is specified to occur.

 

15

 

(b) Certain Definitions. For purposes of this Section 13 and as used elsewhere in the Plan,
the following terms shall be defined as set forth below:

	 	(i)	 	“409A Change in Control” means the occurrence of Change in Control (as
defined in Section 8(e)) in connection with which there occurs a change in the
ownership of the Company, a change in effective control of the Company, or a change in
the ownership of a substantial portion of the assets of the Company (as defined in
Treasury Regulation § 1.409A-3(i)(5)).
	 
	 	(ii)	 	“409A Disability” means an event which results in the Participant being (i)
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result in death or
can be expected to last for a continuous period of not less than 12 months, or (ii),
by reason of any medically determinable physical or mental impairment that can be
expected to result in death or can be expected to last for a continuous period of not
less than 12 months, receiving income replacement benefits for a period of not less
than three months under an accident and health plan covering employees of the Company
or its subsidiaries.
	 
	 	(iii)	 	“Unforeseeable Emergency” means a severe financial hardship to the
Participant resulting from an illness or accident of the Participant, the
Participant’s spouse, or a dependent (as defined in Code Section 152, without regard
to Code Sections 152(b)(1), (b)(2), and (d)(1)(B)) of the Participant, loss of the
Participant’s property due to casualty, or similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Participant, and
otherwise meeting the definition set forth in Treasury Regulation § 1.409A-3(i)(3).

(c) Determination of “Key Employee.” For purposes of a settlement under Section
13(a)(iii)(B), status of a Participant as a “key employee” shall be determined annually under the
Company’s administrative procedure for such determination for purposes of all plans subject to Code
Section 409A.

(d) Short-Term Deferrals. In the case of any compensation that is not a Grandfathered
Deferral but qualifies as a short-term deferral under Code Section 409A (see Treasury Regulation §
1.409A-1(b)(4)), was not settled in 2007 or earlier, and provides for a distribution upon the lapse
of a substantial risk of forfeiture, if the timing of such distribution is not otherwise specified
in the award agreement or other governing document, the distribution shall be made at a date not
later than March 15 of the year following the year in which the substantial risk of forfeiture
lapses. If any portion of such compensation is scheduled to vest at a single specified date (a
vesting “tranche”) and is partly deemed a 409A Deferral and partly deemed exempt from Code Section
409A (as a short-term deferral or otherwise), the time of settlement of the entire tranche will be
governed by the distribution rules applicable to such 409A Deferral.

(e) Predetermined Actual Investments. Any change in deemed investment alternatives offered to
Participants or change in the manner in which earnings are credited on 409A Deferrals and
Grandfathered Deferrals not settled in 2007 or earlier shall be implemented so that the rate of
return to a Participant, in respect of any prior 409A Deferral or any 409A Deferral for which the
election to defer has then become irrevocable, will not exceed the rate of return from a
predetermined actual investment, and otherwise shall comply with applicable requirements of
Treasury Regulation § 1.409A-1(o) and 1.409A-6(a)(4).

 

16

 

(f) Grandfathered Deferrals. With respect to any Grandfathered Deferral, no amendment or
change to the Plan or a document relating to such Grandfathered Deferral,
including an exercise of discretion relating thereto, shall be effective if such change would
constitute a “material modification” within the meaning of applicable guidance under Section 409A,
except in the case of compensation or a deferral that is specifically modified to become compliant
as a 409A Deferral or compliant with an exception or exemption under Code Section 409A.

(g) Rules Applicable to Certain Participants Transferred to Affiliates. For purposes of
determining a separation from service (where the use of the following modified definition is based
upon legitimate business criteria), in applying Code Sections 1563(a)(1), (2) and (3) for purposes
of determining a controlled group of corporations under Code Section 414(b), the language “at least
20 percent” shall be used instead of “at least 80 percent” at each place it appears in Sections
1563(a)(1), (2) and (3), and in applying Treasury Regulation § 1.414(c)-2 (or any successor
provision) for purposes of determining trades or businesses (whether or not incorporated) that are
under common control for purposes of Code Section 414(c), the language “at least 20 percent” shall
be used instead of “at least 80 percent” at each place it appears in Treasury Regulation §
1.414(c)-2.

(h) Scope and Application of this Provision. For purposes of this Section 13, references to a
term or event (including any authority or right of the Company or a Participant) being “permitted”
under Code Section 409A mean that the term or event will not cause the Participant to be deemed to
be in constructive receipt of compensation relating to such 409A Deferral prior to the distribution
of cash, shares or other property or to be liable for payment of interest or a tax penalty under
Section 409A.

14. General Provisions.

(a) Limits on Transfer of Awards. No right, title or interest of any kind in the Plan or to a
Deferral Account, payment or right under the Plan shall be transferable or assignable by a
Participant or his or her Beneficiary, shall be subject to alienation, anticipation, encumbrance,
garnishment, attachment, levy, execution or other legal or equitable process, or shall be subject
to the debts, contracts, liabilities or engagements, or torts of any Participant or his or her
Beneficiary, except that rights to payment may be transferred in connection with the death of a
Participant by will or the laws of descent and distribution or pursuant to a valid Beneficiary
designation filed with the Administrator in accordance with such rules as the Administrator may
prescribe. Any attempt to alienate, sell, transfer, assign, pledge, garnish, attach or take any
other action subject to legal or equitable process or encumber or dispose of any interest in the
Plan (except as permitted in connection with the Participant’s death) shall be void.

(b) Receipt and Release. Payments (in any form) to any Participant or Beneficiary in
accordance with the provisions of the Plan shall, to the extent thereof, be in full satisfaction of
all claims for the compensation or awards deferred and relating to the Deferral Account to which
the payments relate against the Company or any subsidiary or affiliate, and the Administrator may
require such Participant or Beneficiary, as a condition to such payments, to execute a receipt and
release to such effect. In the case of any payment under the Plan of less than all amounts then
credited to an account in the form of Deferred Stock, the amounts paid shall be deemed to relate to
the Deferred Stock credited to the account at the earliest time.

(c) Unfunded Status of Awards; Creation of Trusts. The Plan is intended to constitute an
“unfunded” plan for deferred compensation and Participants shall rely solely on the unsecured
promise of the Company for payment hereunder. With respect to any payment not yet made to a
Participant under the Plan, nothing contained in the Plan shall give a Participant any rights that
are greater than those of a general unsecured creditor of the Company; provided, however, that the
Committee may authorize the creation of Trusts, including but not limited to the Trusts referred to
in Section 6 hereof, or make other arrangements to meet the Company’s obligations under the Plan,
which Trusts or other arrangements shall be consistent with the
“unfunded” status of the Plan and shall comply with applicable requirements of Code Section 409A,
including those referenced in Sections 6(e) and 13.

 

17

 

(d) Compliance. A Participant in the Plan shall have no right to receive payment (in any
form) with respect to his or her Deferral Account until legal and contractual obligations of the
Company relating to establishment of the Plan and the making of such payments shall have been
complied with in full. In addition, the Company shall impose such restrictions on Stock delivered
to a Participant hereunder and any other interest constituting a security as it may deem advisable
in order to comply with the Securities Act of 1933, as amended, the requirements of any stock
exchange or automated quotation system upon which the Stock is then listed or quoted, any state
securities laws applicable to such a transfer, any provision of the Company’s Certificate of
Incorporation or By-Laws, or any other law, regulation, or binding contract to which the Company is
a party.

(e) Other Participant Rights. No Participant shall have any of the rights or privileges of a
stockholder of the Company under the Plan, including as a result of the crediting of Stock
equivalents or other amounts to a Deferral Account, or the creation of any Trust and deposit of
such Stock therein, except at such time as Stock may be actually delivered in settlement of a
Deferral Account. No provision of the Plan or transaction hereunder shall confer upon any
Participant any right to be employed by the Company or a subsidiary or affiliate or to continue to
serve as a director, or to interfere in any way with the right of the Company or a subsidiary or
affiliate to increase or decrease the amount of any compensation payable to such Participant.
Subject to the limitations set forth in Section 14(a) hereof, the Plan shall inure to the benefit
of, and be binding upon, the parties hereto and their successors and assigns.

(f) Tax Withholding. The Company and any subsidiary or affiliate shall have the right to
deduct from amounts otherwise payable by the Company or any subsidiary or affiliate to the
Participant, including compensation not subject to deferral as well as amounts payable hereunder in
settlement of the Participant’s Deferral Account, any sums that federal, state, local or foreign
tax law requires to be withheld with respect to the deferral of compensation hereunder,
transactions affecting the Participant’s Deferral Account, and payments in settlement of the
Participant’s Deferral Account, including FICA, Medicare and other employment taxes. Shares may be
withheld to satisfy such mandatory withholding obligations in any case where taxation would be
imposed upon the delivery of shares, except that shares issued or delivered under any plan,
program, employment agreement or other arrangement may be withheld only in accordance with the
terms of such plan, program, employment agreement or other arrangement and any applicable rules,
regulations, or resolutions thereunder. No amounts deferred by or payable to a non-employee
director under the Plan will be subject to withholding.

(g) Right of Setoff. The Company or any subsidiary may, to the extent permitted by applicable
law, deduct from and set off against any amounts the Company or a subsidiary may owe to the
Participant from time to time, including amounts payable in connection with Participant’s Deferral
Account, owed as wages, fringe benefits, or other compensation owed to the Participant, such
amounts as may be owed by the Participant to the Company, although the Participant shall remain
liable for any part of the Participant’s payment obligation not satisfied through such deduction
and setoff. By electing to participate in the Plan and defer compensation hereunder, the
Participant agrees to any deduction or setoff under this Section 14(g). The foregoing
notwithstanding, no deduction or setoff may be made with respect to a Participant’s Deferral
Account except at the time a payment is otherwise to be made in settlement of such Deferral
Account, and only to the extent of such payment.

(h) Governing Law. The validity, construction, and effect of the Plan, any rules and
regulations relating to the Plan and any document hereunder shall be determined in accordance with
the laws of the State of New York, without giving effect to principles of conflicts of laws, and
applicable provisions of federal law.

 

18

 

(i) Limitation. A Participant and his or her Beneficiary shall assume all risk in connection
with any decrease in value of the Deferral Account and neither the Company, the Committee nor the
Administrator shall be liable or responsible therefore.

(j) Construction. The captions and numbers preceding the sections of the Plan are included
solely as a matter of convenience of reference and are not to be taken as limiting or extending the
meaning of any of the terms and provisions of the Plan. Whenever appropriate, words used in the
singular shall include the plural or the plural may be read as the singular.

(k) Severability. In the event that any provision of the Plan shall be declared illegal or
invalid for any reason, said illegality or invalidity shall not affect the remaining provisions of
the Plan but shall be fully severable, and the Plan shall be construed and enforced as if said
illegal or invalid provision had never been inserted herein.

(l) Status. The establishment and maintenance of, or allocations and credits to, the Deferral
Account of any Participant shall not vest in any Participant any right, title or interest in and to
any Plan assets or benefits except at the time or times and upon the terms and conditions and to
the extent expressly set forth in the Plan and in accordance with the terms of the Trust.

14. Effective Date The Plan shall be effective as of June 1, 2001. The latest amendment and
restatement of the Plan shall become effective as of February 2, 2010.

 

19exv10w1

Exhibit 10.1

AGENCY AGREEMENT

February 23, 2011

Swisher Hygiene Inc.

4725 Piedmont Row Drive, Suite 400

Charlotte, North Carolina 28210

Dear Sirs:

     Clarus Securities Inc., Broadband Capital Management LLC and TD Securities Inc. (collectively,
the “Agents”) understand that Swisher Hygiene Inc. (the “Company”) proposes to offer (the
“Offering”) for sale, on a private placement basis, up to 12,262,500 subscription receipts (the
“Subscription Receipts”) at a purchase price (the “Subscription Receipt Price”) of Cdn.$4.75 per
Subscription Receipt. Each Subscription Receipt will entitle the holder to receive on the closing
of the Acquisition (as defined below) without payment of additional consideration, one share of
common stock, par value U.S. $0.001 per share, of the Company (a “Common Share”). In the event the
closing of the Acquisition does not take place prior to the Termination Time (as defined below),
the Subscription Receipt Agent and the US Escrow Agent (each as defined below), as applicable,
shall return to holders of Subscription Receipts, commencing on the fifth Business Day following
the Termination Time, an amount equal to the full Subscription Amount and their pro rata
entitlement to interest actually earned on such an amount in accordance with the terms of the
Subscription Receipt Agreement (as defined below).

          Based on the foregoing and subject to the terms and conditions set out below, the Agents
hereby agree to act as the Company’s exclusive agents, on a marketed, best efforts basis, to offer
the Subscription Receipts for sale on the Company’s behalf, all as contemplated in this Agreement.

TERMS AND CONDITIONS

1. Definitions. As used in this Agreement, unless the context otherwise requires:

	 	(a)	 	“1934 Act” means the United States Securities and Exchange Act of 1934, as
amended and the rules and regulations promulgated thereunder, including judicial and
administrative interpretations thereof.
	 
	 	(b)	 	“Acquisition” has the meaning ascribed thereto in the Subscription Agreement;
	 
	 	(c)	 	“Acquisition Agreement” has the meaning ascribed thereto in the Subscription
Agreement;
	 
	 	(d)	 	“Action” has the meaning ascribed thereto in Section 6.2(aa) of this Agreement;
	 
	 	(e)	 	“affiliate”, “distribution” and “insider” have the respective meanings ascribed
to them in the Securities Act (Ontario) and “affiliate” shall, without limitation, also
include persons who are “affiliates” within the meaning ascribed to this term in Rule
144(a)(1) under the 1934 Act;
	 
	 	(f)	 	“Agents” has the meaning ascribed thereto in the cover page of this Agreement;
	 
	 	(g)	 	“Agents’ Commission” has the meaning ascribed thereto in Section 4 of this
Agreement;

 

 

	 	(h)	 	“Business Day(s)” means any day other than a Saturday or Sunday or any other
day in which the principal chartered banks located in Toronto, Ontario or Charlotte,
North Carolina are not open for business;
	 
	 	(i)	 	“Clarus” means Clarus Securities Inc.;
	 
	 	(j)	 	“Closing” means the completion of the delivery and sale of the Subscription
Receipts and payment of the Subscription Amount;
	 
	 	(k)	 	“Closing Date” means February 23, 2011 or such other date as may be agreed upon
by the Company and the Agents as of the closing date of the Offering;
	 
	 	(l)	 	“Closing Time” means 8:30 a.m. (Toronto time) on the Closing Date or such other
date or time as the Company and the Agents may decide;
	 
	 	(m)	 	“Code” has the meaning ascribed thereto in Section 6.2(bb)(ii) of this
Agreement;
	 
	 	(n)	 	“Common Share” has the meaning ascribed thereto on the cover page of this
Agreement;
	 
	 	(o)	 	“Company” has the meaning ascribed thereto on the cover page of this Agreement;
	 
	 	(p)	 	“Company Material Adverse Effect” means any event, occurrence, change or effect
that, individually or in the aggregate with all other events, circumstances,
developments, changes and effects, is materially adverse to the affairs, business,
operations, prospects, assets, financial condition, or results of operations of the
Company and the Subsidiaries taken as a whole or would reasonably be expected to
prevent or materially delay the consummation of the transactions contemplated by this
Agreement or the Acquisition Agreement or prevent or materially impair or delay the
ability of the Company to perform its obligations hereunder or under the Acquisition
Agreement, other than any event, occurrence, change or effect to the extent resulting
from any one or more of the following (i) the execution and delivery of this Agreement,
the pendency or public disclosure of this Agreement or the transactions contemplated by
this Agreement (or any action taken by a party in response to such announcement), or
the consummation of the transactions contemplated by this Agreement or (ii) any
outbreak or escalation of hostilities or war or any act of terrorism;
	 
	 	(q)	 	“Company Permits” has the meaning ascribed thereto in Section 6.2(x) of this
Agreement;
	 
	 	(r)	 	“Consistently Applied” has the meaning ascribed thereto is Section 6.2(y) of
this Agreement;
	 
	 	(s)	 	“Contract” has the meaning ascribed thereto in Section 6.2(a) of this
Agreement;
	 
	 	(t)	 	“Disclosure Documents” means each document (as such term is defined in Section
138.1 of the Securities Act (Ontario)) released by the Company since August 18, 2010 or
filed with or furnished to the SEC pursuant to Section 13(a) or 15(d) of the 1934 Act
since November 9, 2010;
	 
	 	(u)	 	“Environmental Laws” has the meaning ascribed thereto in Section 6.2(ff)(ii)(A)
of this Agreement;

-2-

 

	 	(v)	 	“Environmental Permits” has the meaning ascribed thereto in Section
6.2(ff)(ii)(B) of this Agreement;
	 
	 	(w)	 	“Exemptions” means the exemption from the prospectus and registration
requirements under applicable Securities Laws, in respect of the issue of the
Subscription Receipts, Section 2.03 of National Instrument 45-106 — Prospectus and
Registration Exemptions and similar exemptions applicable in the United States or such
other jurisdictions where the Subscription Receipts may be offered or sold;
	 
	 	(x)	 	“ERISA” has the meaning ascribed thereto in Section 6.2(bb)(ii) of this
Agreement;
	 
	 	(y)	 	“Financial Statements” has the meaning ascribed thereto in Section 6.2(y)(i) of
this Agreement;
	 
	 	(z)	 	“GAAP” has the meaning ascribed thereto in Section 6.2(y) of this Agreement;
	 
	 	(aa)	 	“General Solicitation or General Advertising” means “general solicitation or
general advertising”, as used under Rule 502(c) under the U.S. Securities Act,
including advertisements, articles, notices or other communications published in any
newspaper, magazine or similar media or broadcast over radio, television, or
telecommunications, including electronic display or the Internet, or any seminar or
meeting whose attendees had been invited by general solicitation or general
advertising;
	 
	 	(bb)	 	“Government Official” means any (a) officer, employee or other individual
acting in an official capacity for a Governmental Authority), or any officer employee
or other individual acting in an official capacity for a public international
organization or (b) political party or official thereof or any candidate for any
political office;
	 
	 	(cc)	 	“Governmental Authority” means any U.S. or Canadian domestic or foreign
government, whether federal, provincial, state, territorial, local, regional, municipal
or other political jurisdiction, and any agency, authority, instrumentality, court,
tribunal, board, commission, bureau, arbitrator, arbitration tribunal or other
tribunal, or any quasi-governmental or other entity, insofar as it exercises a
legislative, judicial, regulatory, administrative, expropriation or taxing power or
function of or pertaining to government;
	 
	 	(dd)	 	“Hazardous Substances” has the meaning ascribed thereto in Section
6.2(ff)(ii)(C) of this Agreement;
	 
	 	(ee)	 	“Improper Conduct” has the meaning ascribed thereto in Section 6.2(oo) of this
Agreement;
	 
	 	(ff)	 	“Indemnified Party” has the meaning ascribed thereto in Section 9.1 of this
Agreement;
	 
	 	(gg)	 	“Intellectual Property” has the meaning ascribed thereto in Section 6.2(dd)(ii)
of this Agreement;
	 
	 	(hh)	 	“Investments” has the meaning ascribed thereto in Section 6.2(s)(iii) of this
Agreement;
	 
	 	(ii)	 	“IRS” has the meaning ascribed thereto in Section 6.2(bb)(ii) of this
Agreement;
	 
	 	(jj)	 	“Law” has the meaning ascribed thereto in Section 6.2(w) of this Agreement;

-3-

 

	 	(kk)	 	“Lease Documents” has the meaning ascribed thereto in Section 6.2(cc)(ii) of
this Agreement;
	 
	 	(ll)	 	“Leased Properties” has the meaning ascribed thereto in Section 6.2(cc)(ii) of
this Agreement;
	 
	 	(mm)	 	“Legislation” has the meaning ascribed thereto in Section 6.2(oo) of this
Agreement;
	 
	 	(nn)	 	“Licensed Intellectual Property” has the meaning ascribed thereto in Section
6.2(dd)(i) of this Agreement;
	 
	 	(oo)	 	“lien” means any mortgage, pledge, lien, encumbrance, charge or other security
interest;
	 
	 	(pp)	 	“Losses” has the meaning ascribed thereto in Section 9.1 of this Agreement;
	 
	 	(qq)	 	“material” means material in relation to the Company and its Subsidiaries
considered on a consolidated basis;
	 
	 	(rr)	 	“material change” has the meaning ascribed to it in the Securities Act
(Ontario);
	 
	 	(ss)	 	“material fact” has the meaning ascribed to it in the Securities Act (Ontario);
	 
	 	(tt)	 	“Material Subsidiaries” means the Subsidiaries whose assets or revenues,
calculated on an individual basis, represent more than 10% of the consolidated assets
or revenues of the Company;
	 
	 	(uu)	 	“misrepresentation” means, with respect to circumstances in which the
Securities Laws are applicable, a misrepresentation as defined under the Securities Act
(Ontario);
	 
	 	(vv)	 	“Most Recent Balance Sheet” has the meaning ascribed thereto in Section
6.2(y)(ii) of this Agreement;
	 
	 	(ww)	 	“Multiemployer Plan” has the meaning ascribed thereto in Section 6.2(bb)(ii) of
this Agreement;
	 
	 	(xx)	 	“NI 45-102” means National Instrument 45-102 — Resale of Securities;
	 
	 	(yy)	 	“NI 51-102” means National Instrument 51-102 — Continuous Disclosure Obligations;
	 
	 	(zz)	 	“Offering” has the meaning ascribed thereto on the cover page of this Agreement;

	 	(aaa)	 	“Owned Intellectual Property” has the meaning ascribed thereto in Section
6.2(dd)(iv) of this Agreement;
	 
	 	(bbb)	 	“Owners” has the meaning ascribed thereto in Section 6.2(oo) of this
Agreement;
	 
	 	(ccc)	 	“Penalty Shares” has the meaning ascribed thereto in the Subscription
Agreement;
	 
	 	(ddd)	 	“Permitted Liens” means with respect to any assets of the Company (i)
mechanic’s materialmen’s and similar liens with respect to amounts not past due, (ii)
liens for income Taxes or other Taxes not yet due and payable or for income Taxes or
other Taxes that the taxpayer is contesting in good faith pursuant to proceedings
disclosed in the Disclosure

-4-

 

	 	 	 	Documents, (iii) purchase money liens arising by operation
of law (including liens on
inventory and other assets in favour of vendors of the Company) and (iv) liens
securing rental payments under capital lease arrangements disclosed in the
Disclosure Documents;
	 
	 	(eee)	 	“Personnel” has the meaning ascribed thereto in Section 9.3 of this Agreement;
	 
	 	(fff)	 	“Personal Property” has the meaning ascribed thereto in Section 6.2(cc)(iv) of
this Agreement;
	 
	 	(ggg)	 	“Plans” has the meaning ascribed thereto in Section 6.2(bb)(ii) of this
Agreement;
	 
	 	(hhh)	 	“Release” has the meaning ascribed thereto in Section 6.2(ff)(ii)(D) of this
Agreement;
	 
	 	(iii)	 	“Registration Statement” has the meaning ascribed thereto in Schedule “F” to
the Subscription Agreement;
	 
	 	(jjj)	 	“Regulation D” means Regulation D promulgated under the U.S. Securities Act;
	 
	 	(kkk)	 	“Regulation M” means Regulation M promulgated under the 1934 Act;
	 
	 	(lll)	 	“Regulation S” means Regulation S promulgated under the U.S. Securities Act;
	 
	 	(mmm)	 	“representatives” has the meaning ascribed thereto in Section 6.2(oo) of this
Agreement;
	 
	 	(nnn)	 	“SEC” means the United States Securities and Exchange Commission;
	 
	 	(ooo)	 	“Securities” means the Subscription Receipts, Underlying Common Shares and
Penalty Shares;
	 
	 	(ppp)	 	“Securities Laws” means, as applicable, the securities laws, regulations,
rules, rulings and orders in each of the Selling Jurisdictions, and the notices,
policies and written interpretations issued by the Securities Regulators in each of the
Selling Jurisdictions, and the rules of the Toronto Stock Exchange and Nasdaq/ Global
Market;
	 
	 	(qqq)	 	“Securities Regulators” means the securities commissions or other securities
regulatory authorities of all of the Selling Jurisdictions or the relevant Selling
Jurisdiction as the context so requires;
	 
	 	(rrr)	 	“Selling Jurisdictions” means each of the provinces of Canada, the United
States and any state of the United States of America and such other jurisdictions where
the Agents choose to sell Subscription Receipts in accordance with this Agreement
provided that the Company is not required to file a prospectus or other disclosure
document or become subject to reporting obligations in such other jurisdictions;
	 
	 	(sss)	 	“Stock Exchanges” means the Toronto Stock Exchange and the NASDAQ Global
Market;
	 
	 	(ttt)	 	“Subscriber” means a purchaser of Subscription Receipts and “Subscribers”
means all of the purchasers of the Subscription Receipts;

-5-

 

	 	(uuu)	 	“Subscription Agreements” means the agreements to be entered into between the
Company and each Subscriber of Subscription Receipts resident in a Selling
Jurisdiction in the form attached as Schedule “A” hereto;
	 
	 	(vvv)	 	“Subscription Receipt” has the meaning ascribed thereto on the cover page of
this Agreement;
	 
	 	(www)	 	“Subscription Receipt Agent” means Equity Financial Trust Company;
	 
	 	(xxx)	 	“Subscription Receipt Agreement” means the subscription receipt agreement
entered into between the Company, the Agents, the Subscription Agent and the U.S.
Escrow Agent on the Closing Date governing the terms and conditions of the Subscription
Receipts;
	 
	 	(yyy)	 	“Subscription Receipt Certificate” means the certificate to be dated the date
of issue which will represent the Subscription Receipts substantially in the form
attached to the Subscription Receipt Agreement as Schedule “A”;
	 
	 	(zzz)	 	“Subscription Receipt Price” has the meaning ascribed thereto on the cover
page of this Agreement;
	 
	 	(aaaa)	 	“Subsidiaries” any entity of which more than 50 percent of the voting securities are
directly or indirectly owned by the Company and the financial statements of which are
consolidated with those of the Company and “Subsidiary” means any one of the
Subsidiaries;
	 
	 	(bbbb)	 	“Taxes” has the meaning ascribed hereto in Section 6.2(ee)(v) of this Agreement;
	 
	 	(cccc)	 	“Tax Returns” has the meaning ascribed thereto in Section 6.2(ee)(v)(B) of this
Agreement;
	 
	 	(dddd)	 	“Termination Time” means 11:59 pm (Toronto time) on March 31, 2011;
	 
	 	(eeee)	 	“to the knowledge of” means (unless otherwise expressly stated), with respect to the
Company, a statement of the actual knowledge, after having made reasonable enquiries
(such reasonable enquiries not needing to include enquiries of third parties), of Steve
Berrard, Tom Byrne and Tom Aucamp of the facts or circumstances to which such phrase
relates;
	 
	 	(ffff)	 	“United States” means the United States of America, its territories and possessions,
any state of the United States, and the District of Columbia;
	 
	 	(gggg)	 	“U.S. Escrow Agent” means Continental Stock Transfer & Trust Co.;
	 
	 	(hhhh)	 	“U.S. Person” means a U.S. Person as defined in Rule 902(k) of Regulation S under the
U.S. Securities Act;
	 
	 	(iiii)	 	“U.S. Securities Act” means the United States Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder, including judicial and administrative
interpretations thereof;

-6-

 

	 	(jjjj)	 	“U.S. Securities Laws” means the applicable blue sky or securities legislation in the
United States, together with the 1934 Act and the U.S. Securities Act and the rules and
regulations of the SEC or state securities authority thereunder; and
	 
	 	(kkkk)	 	“Underlying Common Shares” means the Common Shares issuable upon exchange of the
Subscription Receipts in accordance with and subject to the terms of the Subscription
Receipt Agreement.

2. Interpretation. For the purposes of this Agreement, except as otherwise expressly provided or
unless the context otherwise requires:

	 	(a)	 	“this Agreement” means this Agency Agreement;
	 
	 	(b)	 	any reference in this Agreement to a designated “Section”, “Subsection”,
“Paragraph”, “Schedule” or other subdivision refers to the designated section,
subsection, paragraph, schedule or other subdivision of this Agreement;
	 
	 	(c)	 	the words “herein” and “hereunder” and other words of similar import refer to
this Agreement as a whole and not to any particular section or other subdivision of
this Agreement;
	 
	 	(d)	 	the word “including”, when following any general statement, term or matter, is
not to be construed to limit such general statement, term or matter to the specific
items or matters set forth immediately following such word or to similar items or
matters, whether or not non-limiting language (such as “without limitation” or “but not
limited to” or words of similar import) is used with reference thereto but rather
refers to all other items or matters that could reasonably fall within the broadest
possible scope of such general statement, term or matter;
	 
	 	(e)	 	any reference to a statute includes and, unless otherwise specified herein, is
a reference to such statute and to the regulations made pursuant thereto, with all
amendments made thereto and in force from time to time, and to any statute or
regulations that may be passed which have the effect of supplementing or superseding
such statute or such regulation;
	 
	 	(f)	 	any reference to “party” or “parties” means the Company, the Agents, or all of
them, as the context requires;
	 
	 	(g)	 	the headings in this Agreement are for convenience of reference only and do not
affect the interpretation of this Agreement; and
	 
	 	(h)	 	words importing the masculine gender include the feminine or neuter gender and
words in the singular include the plural, and vice versa.

3. Appointment of Agents. Subject to the terms and conditions of this Agreement, the Company
appoints the Agents, and the Agents agree to act as the exclusive Agents of the Company, to offer
the Subscription Receipts for sale in the Selling Jurisdictions and to use their marketed, best
efforts to solicit and procure Subscribers of the Subscription Receipts on behalf of the Company.
The Subscription Receipts will be sold by way of the exemption from registration under the U.S.
Securities Act provided by Section 4(2) thereof and Rule 506 of Regulation D thereunder and (i)
private placement to “Accredited Investors” under the applicable Exemptions in each of the
provinces of Canada, (ii) in the United States pursuant to the foregoing exemptions, and (iii) in
such other jurisdictions (in accordance

-7-

 

with local laws) as may be agreed to by the Company and the
Agents provided that the Company is not required to file a prospectus or other disclosure document
or become subject to reporting obligations in such jurisdictions. The Company shall issue and sell
the Subscription Receipts at the Closing Time, in accordance with and subject to the provisions of
this Agreement and the Subscription Agreements. It is
understood and agreed by the parties that the Agents shall act as agent only and at no time shall
the Agents have any obligation whatsoever to purchase Subscription Receipts as principal.

4. Agents’ Commission. In consideration of the Agents agreement to act as financial advisors to
the Company, find and introduce potential Subscribers of the Subscription Receipts and otherwise
assist in the distribution of the Subscription Receipts in accordance with this Agreement, the
Company agrees to pay to the Agents an aggregate cash commission (the “Agents’ Commission”) equal
to 5.0% of the gross proceeds of the Subscription Receipts. The Agents’ Commission shall be
payable by the Company to Clarus on behalf of the Agents on the closing date of the Acquisition,
pursuant to the provisions of the Subscription Receipt Agreement.

In addition, the Company agrees to pay the Agents’ expenses in accordance with Section 12.

5. Offering Procedures.

5.1 Each Subscriber of Subscription Receipts will purchase Subscription Receipts and the Company
will issue and sell the Subscription Receipts pursuant to exemptions from applicable prospectus and
registration requirements under Securities Laws of the jurisdiction of residence of the Subscriber
or such other jurisdiction as may be applicable to the Subscriber and as contemplated by the
Subscription Agreements. Each Subscriber will enter into a Subscription Agreement with the
Company. The Agents will notify the Company with respect to the identities of Subscribers in
sufficient time to allow the Company to comply with all applicable regulatory requirements and all
requirements under the Securities Laws to be complied with by the Company as a result of the
offering and sale of the Subscription Receipts to such Subscribers on a private placement basis in
such Selling Jurisdictions.

5.2 The Company and the Agents will each use their best efforts to file or cause to be filed all
documents required to be filed by the Company and the Subscribers, respectively, in connection with
the purchase and sale of the Subscription Receipts so that the distribution of the Subscription
Receipts may lawfully occur on an exempt basis.

5.3 The Company covenants that it will, as soon as reasonably practicable after the Closing,
prepare and file the Registration Statement as set out in Schedule “F’ to the Subscription
Agreement.

5.4 The Company will promptly inform the Agents of the receipt by the Company of any material
communication from the Securities Regulators or any other securities regulatory authority of any
other jurisdiction, the Stock Exchanges or any other competent authority relating to the
Registration Statement, the “form 10 information” (as defined in Rule 144(i)(2) under the 1933 Act)
or the Company’s other filings with the SEC.

6. Representations and Warranties of the Company.

6.1 Each officers’ certificate required to be provided in accordance with the terms of this
Agreement, signed by any officer of the Company and delivered to the Agents or Agents’ counsel,
will constitute a representation and warranty by the Company to the Agents or Agents’ counsel, as
the case may be, as to the matters covered by the certificate.

-8-

 

6.2 The Company represents and warrants to each of the Agents and acknowledges that each of the
Agents is relying upon such representations and warranties in connection with its execution and
delivery of this Agreement that:

	 	(a)	 	the Subscription Agreements, the Subscription Receipt Agreement and the
Subscription Receipt Certificates have been duly authorized, executed and delivered by
the Company and, assuming due authorization, execution and delivery by the other
parties thereto, is,
or will be, a legal, valid and binding obligation of the Company enforceable against
the Company in accordance with its terms, except as that enforcement may be limited
by bankruptcy, insolvency and other laws affecting the rights of creditors generally
and except that equitable remedies may be granted only in the discretion of a court
of competent jurisdiction;
	 
	 	(b)	 	the Subscription Receipts, Underlying Common Shares and Penalty Shares to be
issued by the Company and/or sold pursuant to this Agreement and the Subscription
Agreements will be duly authorized for that issuance and sale by all necessary action
on the part of the Company and, when issued and delivered by the Company against
payment of the applicable consideration, the Subscription Receipts, Underlying Common
Shares and Penalty Shares issued pursuant to this Agreement and the Subscription
Agreements, will have been validly issued, will be outstanding as fully paid and
non-assessable and will not have been issued in violation of or subject to any
pre-emptive rights or other contractual rights to purchase securities issued by the
Company or in violation of any applicable law;
	 
	 	(c)	 	the Company is a reporting issuer under the securities laws of the Provinces of
British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Québec, New Brunswick, Nova
Scotia, Prince Edward Island and Newfoundland and a registrant under the 1934 Act, and
is not in default in any material respect of any requirement of such securities laws
and the Company is not included on a list of defaulting reporting issuers maintained by
the Securities Regulators of the Provinces of British Columbia, Alberta, Saskatchewan,
Manitoba, Ontario, Québec, New Brunswick, Nova Scotia, Prince Edward Island and
Newfoundland and further, that commencing on November 10, 2011 holders of the
Underlying Common Shares will be able to offer and sell such Underlying Common Shares
pursuant to Rule 144(i) under the 1933 Act, provided that at the time of any such offer
or sale, the holder thereof is not an Affiliate of the Company, and provided further,
that at that time of such offer or sale, the Company has filed all reports and other
materials required to be filed by it pursuant to Section 13 or 15(d) under the 1934 Act
during the preceding 12 months, other than Form 8-K reports;
	 
	 	(d)	 	no order ceasing or suspending trading in securities of the Company,
prohibiting the sale of such securities, has been issued to the Company, directors or
officers and, to the knowledge of the Company, no such investigations or proceedings
for such purposes are pending or threatened;
	 
	 	(e)	 	the Subscription Receipt Agent, at its principal office in Toronto, has been
duly appointed as transfer agent and registrar for the Common Shares;
	 
	 	(f)	 	the Underlying Common Shares will not be subject to a restricted period or to a
statutory hold period under the Securities Laws or to any resale restriction under the
policies of the Stock Exchanges other than as described in the Subscription Agreement;

-9-

 

	 	(g)	 	the Company will use the proceeds of the Offering in the manner described in
the Subscription Agreement;
	 
	 	(h)	 	since August 18, 2010, the Company has been in compliance in all material
respects with its continuous disclosure obligations under applicable Securities Laws;
	 
	 	(i)	 	all the statements set forth in the Disclosure Documents were true, correct,
and complete in all material respects and did not contain any misrepresentation as of
the date of such
statements and the Company has not filed any confidential material change reports
under the laws of Canada or the United States since the date of such statements
which remain confidential as at the date hereof;
	 
	 	(j)	 	other than as disclosed in the Disclosure Documents, no material fact or
material change has arisen or has been discovered which would have been required to
have been stated in the Disclosure Documents had the fact arisen or been discovered on,
or prior to, the date of such Disclosure Documents, and, except as have been disclosed
in the Disclosure Documents, the Company has not suffered a Company Material Adverse
Effect since November 2, 2010 and the Company has not suffered a Company Material
Adverse Effect in relation to the Common Shares;
	 
	 	(k)	 	the Company’s Auditors are independent public accountants as required under
applicable Securities Laws, are qualified to act as auditors of the Company under the
applicable Securities Laws, and there has never been a reportable disagreement (within
the meaning of the applicable Securities Laws) between the Company and the Company’s
Auditors;
	 
	 	(l)	 	during the period in which the Subscription Receipts are offered for sale, the
Company did not and will not authorize any person acting on its or their behalf (other
than the Agents, their affiliates and any person acting on their behalf, as to which no
representation is made) to take any action that would cause the exemption afforded by
Section 4(2) of the U.S. Securities Act or Rule 506 thereunder to be unavailable for
offers and sales of the Subscription Receipts, pursuant to this Agreement;
	 
	 	(m)	 	neither the Company, nor any of its affiliates, nor any person authorized to
act on its behalf have engaged or will engage in any form of General Solicitation or
General Advertising with respect to offers or sales of the Subscription Receipts;
	 
	 	(n)	 	the Company has not, for a period of six months prior to the date hereof sold,
offered for sale or solicited any offer to buy any of its securities in the United
States in a manner that would be “integrated” with the Offering and that would cause
the exemption afforded by Section 4(2) of the U.S. Securities Act and Rule 506 of
Regulation D to be unavailable for offers and sales of the Subscription Receipts;
	 
	 	(o)	 	during the period in which the Subscription Receipts are offered for sale,
neither the Company nor any of its affiliates, nor any person authorized to act on its
behalf (other than the Agents, their affiliates and any person acting on their behalf,
as to which no representation is made) has taken or will take, directly or indirectly,
any action that would constitute a violation of Regulation M of the SEC under the 1934
Act;
	 
	 	(p)	 	the Company shall cause a Form D to be filed with the SEC within 15 days of the
first sale of Subscription Receipts and shall, unless directed to the contrary by the
Agents with regard to any jurisdiction in which a U.S. Affiliate is relying on a state
institutional

-10-

 

	 	exemption that does not require the making of any filing, make such other
filings as shall be required by applicable state Securities Laws to secure exemption
from registration under such securities laws for the sale of the Subscription Receipts
in such states;
	 
	(q) 	neither the Company nor any of the affiliates thereof has been subject to any
order, judgment or decree of any court of competent jurisdiction temporarily,
preliminarily or permanently enjoining such person for failure to comply with Rule 503
of Regulation D concerning the filing of notice of sales on Form D;
	 
	(r) 	the Company is not now and, as a result of the transactions contemplated by
this Agreement and the Subscription Agreements, will not be an “investment company” (as
defined in the United States Investment Company Act of 1940) that is or will be
required to be registered under Section 8 of that Act;
	 
	(s) 	(i)		the Company and each Subsidiary of the Company is a corporation duly
incorporated, validly existing and in good standing under the laws of the jurisdiction
of its incorporation and has the requisite corporate or other power and authority and
all necessary governmental approvals to own, lease and operate its properties and to
carry on its business as it is now being conducted. The Company and each Subsidiary is
duly qualified or licensed as a foreign corporation to do business, and is in good
standing, in each jurisdiction where the character of the properties owned, leased or
operated by it or the nature of its business makes such qualification or licensing
necessary, except for such failures to be so qualified or licensed and in good standing
that would not reasonably be expected to have a Company Material Adverse Effect;

	 	(ii)	 	a true and complete list of all Material Subsidiaries, together
with the jurisdiction of incorporation, or formation, of each such Subsidiary
and the percentage of the outstanding capital stock or other equity interests
of each such Subsidiary owned by the Company, each other Subsidiary and any
other person, is set forth in the Disclosure Documents; and
	 
	 	(iii)	 	the Disclosure Documents list any and all persons of which the
Company directly or indirectly owns an equity or similar interest, or an
interest convertible into or exchangeable or exercisable for an equity or
similar interest, of less than 50% of such person (collectively, the
“Investments”). Except as set forth in the Disclosure Documents and except as
indicated on the Financial Statements, the Company or a Subsidiary, as the case
may be, owns all Investments free and clear of all Liens, and there are no
outstanding contractual obligations of the Company or any Subsidiary permitting
the repurchase, redemption or other acquisition of any of its interest in the
Investments on terms that are not fair market value terms or to provide funds
to, or make any investment (in the form of a loan, capital contribution or
otherwise in, or provided any material guarantee with respect to, any
Investment);

	 	(t)	 	the Company has made available to the Agents a complete and correct copy of the
articles of incorporation and the bylaws each as amended to date, of the Company and
each Subsidiary. Such articles of incorporation and bylaws are in full force and
effect and no other organizational documents are applicable or binding upon the Company
or any of its Subsidiaries. Neither the Company nor any Subsidiary is currently in
violation of any material provision of its articles of incorporation or bylaws or
similar

-11-

 

	 	organizational documents in any material respect. The Company has made
available to the Agents a complete and correct copies of the minutes of all meetings
and all written consents of the board of the Company (and each committee thereof) and
of the shareholders of the Company;
	 
	(u) 	(i) 	 	as of the date of this Agreement, the authorized capital stock of the
Company consists of Common Shares, of which 115,577,927 are issued and outstanding.
Each outstanding Common Share is duly authorized, validly issued, fully paid and
nonassessable and was issued free of preemptive (or similar) rights; and

	 	(ii)	 	except as described in the Disclosure Documents and in this
Agreement, there are no (A) options, warrants or other rights, agreements,
arrangements or commitments of any character relating to the issued or unissued
capital stock of the Company or any Subsidiary or obligating the Company or any
Subsidiary or any shareholder of the Company to issue or sell any shares of
capital stock of, or other equity interests in, the Company or any Subsidiary,
(B) voting securities of the Company or securities convertible, exchangeable or
exercisable for shares of capital stock or voting securities of the Company, or
(C) equity equivalents, interests in the ownership or earnings of the Company
or any Subsidiary or rights with respect to the foregoing. All shares of
Common Stock reserved for issuance as aforesaid, upon issuance on the terms and
conditions specified in the instruments pursuant to which they are issuable,
will be duly authorized, validly issued, fully paid and nonassessable and free
of preemptive (or similar) rights. All securities of the Company have been
issued in compliance with all applicable Laws, except to the extent that any
non-compliance will not result in any Company Material Adverse Effect. There
are no outstanding contractual obligations of the Company or any Subsidiary to
repurchase, redeem or otherwise acquire any shares of Common Stock or any
capital stock of any Subsidiary or to provide funds to or make any investment
(in the form of a loan, capital contribution or otherwise) in any Subsidiary or
any other Person. Except as set forth in the Disclosure Documents, none of the
Company or any Subsidiary is a party to any shareholders’ agreement, voting
trust agreement or registration rights agreement relating to any equity
securities of the Company or any Subsidiary or any other Contract relating to
disposition, voting or dividends with respect to any equity securities of the
Company or of any Subsidiary;

	 	(v)	 	the Company has all necessary power and authority to execute and deliver this
Agreement, the Subscription Receipt Agreement and the Subscription Agreements, and to
perform its obligations thereunder. The execution and delivery of this Agreement by the
Company have been duly authorized by all necessary corporate action and no other
corporate proceedings on the part of the Company are necessary to authorize this
Agreement. This Agreement has been duly and validly executed and delivered by the
Company and, assuming the due authorization, execution and delivery by the Agents
constitutes a legal, valid and binding obligation of the Company, enforceable against
it in accordance with its terms, except as that enforcement may be limited by
bankruptcy, insolvency and other laws affecting the rights of creditors generally and
except that equitable remedies may be granted only in the discretion of a court of
competent jurisdiction;
	 
	 	(w)	 	the execution and delivery of this Agreement, the Subscription Receipt
Agreement and the Subscription Agreements by the Company does not, and the performance
by the

-12-

 

	 	Company of its obligations under this Agreement, the Subscription Receipt
Agreement and the Subscription Agreements does not and will not, (i) conflict with or
result in a violation or breach of the Articles of Incorporation or Bylaws (or similar
organizational documents) of the Company, (ii) except for post-closing filings made in
the ordinary course for transactions of the kind set out in this Agreement, the
Subscription Receipt Agreement and the Subscription Agreements, conflict with or
violate any statute, law, ordinance, regulation, rule, common law, code, executive
order, judgment, decree or other order (“Law”) applicable to the Company or by which
any property or asset of the Company is bound or affected, or (iii) result in any
breach or violation of or constitute a default (or an event which, with notice or lapse
of time or both, would become a default) under, require consent or result in a material
loss of a material benefit under, give rise to
a right or obligation to purchase or sell assets or securities under, give to others
any right of termination, amendment, acceleration or cancellation of, or result in
the creation of a Lien on any material property or asset of the Company or any
Subsidiary pursuant to, any note, bond, mortgage, indenture, contract (written or
oral), agreement, lease, license, permit, franchise or other binding commitment,
instrument or obligation (each, a “Contract”) to which the Company or any Subsidiary
is a party or by which the Company or a Subsidiary or any material property or asset
of the Company or any Subsidiary is bound or affected, except, with respect to
clauses (ii) and (iii), for any such conflicts, violations, breaches, defaults or
other occurrences which would not reasonably be expected to have a Company Material
Adverse Effect;
	 
	(x) 	the Company and each Subsidiary is in possession of all material franchises,
grants, authorizations, licenses, permits, easements, variances, exceptions, consents,
certificates, approvals and orders of any Governmental Authority necessary for each
such entity to own, lease and operate its material properties or to carry on its
business substantially as it is now being conducted (the “Company Permits”), and no
suspension or cancellation of any of the Company Permits is pending or, to the
knowledge of the Company, threatened. Neither the Company nor any Subsidiary is
operating in material violation of: (a) any Law applicable to such entity or by which
any property or asset of such entity is bound or affected, and (b) any Company Permit
to which such entity is a party or by which such entity or any such property or asset
of such entity is bound, except in any case for any such violations which would not
have a Company Material Adverse Effect. Neither the Company nor any Subsidiary has
received written notice of any default, and, to the Company’s knowledge, no event has
occurred which, with notice or lapse of time or both would constitute a default;
	 
	(y) 	(i) 	 	the financial statements in the Disclosure Documents (the “Financial
Statements”) have been prepared in accordance with U.S. generally accepted accounting
principles (“GAAP”), applied on a consistent basis throughout the periods involved
(except to the extent required by changes in GAAP or as may be indicated in the notes
thereto, if any) (hereinafter, “Consistently Applied”) and present fairly, in all
material respects, the consolidated or combined financial position of the Company and
its Subsidiaries as of the respective dates thereof and the results of operations for
the periods indicated; and

	 	(ii)	 	neither the Company nor any Subsidiary have any liabilities,
obligations or commitments (including without limitation, liabilities,
obligations or commitments to fund any operations or work or to give any
guarantees or for Taxes) whether accrued, absolute, contingent or otherwise, of
the type required by GAAP to be reflected or reserved against on the balance
sheets except (i) to

-13-

 

	 	 	 	the extent reflected, reserved or taken into account in
the balance sheet of Swisher International, Inc. and its subsidiaries as of
September 30, 2010 (and included in the Form 10 of the Company), including all
notes thereto, if any and the most recently filed balance sheet of the Company
in the Disclosure Documents (collectively, the “Most Recent Balance
Sheet”) and not heretofore paid or discharged, (ii) liabilities incurred in
the ordinary course of business consistent with past practice since the date of
the Most Recent Balance Sheet (none of which relates to breach of contract,
breach of warranty, tort, infringement or violation of law, or which arose out
of any action, suit, claim, governmental investigation or arbitration
proceeding), (iii) normal accruals, reclassifications, and audit adjustments
which would be reflected on an audited financial statement and which would not
be material on a consolidated basis, (iv)
liabilities incurred in the ordinary course of business consistent with past
practice prior to the date of the Most Recent Balance Sheet which, in
accordance with GAAP Consistently Applied, were not recorded thereon, and
(v) except as would not result in a Company Material Adverse Effect;

	(z) 	except in connection with the transactions contemplated by this Agreement,
during the period beginning on November 9, 2010 and ending on the date hereof, the
Company (on a consolidated basis) has conducted its business, in all material respects,
in the ordinary course consistent with past practice;
	 
	 (aa) 	there is no litigation, suit, claim, action, proceeding, hearing, petition,
grievance, complaint or investigation (an “Action”) pending or, to the
knowledge of the Company, threatened against the Company or any Subsidiary, or any
property or asset of the Company or any Subsidiary, before any Governmental Authority
or arbitrator that would reasonably be expected to have a Company Material Adverse
Effect. As of the date of this Agreement, to the Company’s knowledge no officer or
director of the Company is a defendant in any Action in connection with his status as
an officer or director of the Company or any Subsidiary. Other than pursuant to
Articles of Incorporation, Bylaws or other organizational documents, no Contract
between the Company or any Subsidiary and any current or former director or officer
exists that provides for indemnification. Neither the Company nor any Subsidiary nor
any property or asset of the Company or any Subsidiary is subject to any continuing
order of, consent decree, settlement agreement or other similar written agreement with,
or, to the knowledge of the Company, continuing investigation by, any Governmental
Authority, or any order, writ, judgment, injunction, decree, determination or award of
any Governmental Authority. Neither the Company nor any Subsidiary has received
written notice of any default, and, to the Company’s knowledge, no event has occurred
which, with notice or lapse of time or both, would constitute a default by the Company
or the applicable Subsidiaries in connection with any of the foregoing which would
result in a Company Material Adverse Effect;
	 
	(bb) 	(i) 	 	except as set forth in the Disclosure Documents, the Company is not a party
to or bound by any collective bargaining agreement or any other agreement with a labor
union, and, to the Company’s knowledge, there has been no effort by any labor union
during the 24 months prior to the date hereof to organize any employees of the Company
into one or more collective bargaining units. There is no pending or, to the Company’s
knowledge, threatened labor dispute, strike or work stoppage which affects or which may
affect the business of the Company or which may interfere with its continued
operations. Neither the Company (on a consolidated basis) nor to the Company’s
knowledge any agent, representative or

-14-

 

	 	 	 	employee thereof has within the last 12 months
committed any unfair labor practice as defined in the National Labor Relations Act, as
amended, and there is no pending or, to the Company’s knowledge, threatened charge or
complaint against the Company (on a consolidated basis) by or with the National Labor
Relations Board or any representative thereof. There has been no strike, walkout or
work stoppage or threat thereof involving any of the employees of the Company during
the 12 months prior to the date hereof. The Company (on a consolidated basis) has
complied in all material respects with applicable Laws, rules and regulations relating
to employment, civil rights and equal employment opportunities, including but not
limited to, the Civil Rights Act of 1964, the Fair Labor Standards Act, and the
Americans with Disabilities Act, as amended, except for those instances of
non-compliance which would not result in a Company Material Adverse Effect;

	 	(ii)	 	the Company has made available to Agents all material employee
benefit plans (as defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”)) and all bonus, stock
option, stock purchase, restricted stock, incentive, deferred compensation,
retiree medical or life insurance, supplemental retirement, severance or other
benefit plans, programs or arrangements, and all employment, termination,
severance or other contracts or agreements to which the Company or any
Subsidiary is a party, with respect to which the Company or any Subsidiary has
any obligation or which are maintained, contributed to or sponsored by the
Company or any Subsidiary for the benefit of any current or former employee,
consultant, officer or director of the Company or any Subsidiary (collectively,
the “Plans”). The Company has made available to Agents a true and
complete copy of each Plan and has made available to Agents a true and complete
copy of (where applicable) (A) each trust or funding arrangement prepared in
connection with each such Plan, (B) the two most recently filed annual reports
on Internal Revenue Service (“IRS”) Form 5500, (C) the most recently
received IRS determination letter for each such Plan, (D) the two most recently
prepared actuarial reports and financial statements in connection with each
such Plan, and (E) the most recent summary plan description and any material
written communications (or a description of any material oral communications)
by the Company or the Subsidiaries to any current or former employees,
consultants, or directors of the Company or any Subsidiary concerning the
extent of the benefits currently provided under a Plan;
	 
	 	(iii)	 	neither the Company nor any Subsidiary has now or at any time
contributed to, sponsored, or maintained (i) a pension plan (within the meaning
of Section 3(2) of ERISA) subject to Section 412 of the United States Internal
Revenue Code of 1986, as amended (the “Code”) or Title IV of ERISA;
(ii) a multiemployer plan (within the meaning of Section 3(37) or 4001(a)(3) of
ERISA) (a “Multiemployer Plan”); or (iii) a single employer pension
plan (within the meaning of Section 4001(a)(15) of ERISA) for which the Company
or any Subsidiary could incur liability under Section 4063 or 4064 of ERISA (a
“Multiple Employer Plan”);
	 
	 	(iv)	 	with respect to the Plans, no event has occurred and, to the
knowledge of the Company, there exists no condition or set of circumstances, in
connection with which the Company or any Subsidiary could reasonably be
expected to be subject to any actual or contingent liability under the terms of
such Plan or any applicable Law which would reasonably be expected to have a
Company

-15-

 

	 	 	 	Material Adverse Effect. Each Plan may be amended or terminated
without liability to the Company, other than liability for accrued benefits
through the date of the amendment or termination and administrative costs of
amending or terminating the Plan;
	 
	 	(v)	 	each Plan that is intended to be qualified under Section 401(a)
of the Code has received a favorable determination letter or prototype opinion
letter from the IRS covering all of the provisions applicable to the Plan for
which determination letters or prototype opinion letters are currently
available that the Plan is so qualified and each trust established in
connection with any Plan which is intended to be exempt from federal income
taxation under Section 501(a) of the Code is so exempt, and, to the knowledge
of the Company, no circumstance exists that could reasonably be expected to
result in the revocation of such exemption;
	 
	 	(vi)	 	each Plan has been established and administered by the
Company’s third party administrators to the knowledge of the Company, in
accordance with its terms, and in compliance with the applicable provisions of
ERISA, the Code and other applicable Laws, except to the extent such
noncompliance, would not reasonably be expected to have a Company Material
Adverse Effect;
	 
	 	(vii)	 	with respect to any Plan, (A) no Actions (other than routine
claims for benefits in the ordinary course) are pending or, to the knowledge of
the Company, threatened, that would reasonably be expected to have a Company
Material Adverse Effect, (B) to the knowledge of the Company, no facts or
circumstances exist that could reasonably be expected to give rise to any such
Actions, and (C) no administrative investigation, audit or other administrative
proceeding by the Department of Labor, the IRS or other Governmental Authority
is pending, in progress or, to the knowledge of the Company, threatened that
would reasonably expected to have a Company Material Adverse Effect; and
	 
	 	(viii)	 	each Plan that is a “group health plan” (as defined in Code Section
5000(b)(1), Title I of ERISA or the U.S. Public Health Service Act) has been
operated by the Company’s third party administrators to the knowledge of the
Company, in compliance in all material respects with (i) the group health plan
continuation coverage requirements of Section 4980B of the Code and Sections
601 through 608 of ERISA (“COBRA Coverage”) or similar state law, (ii) Section
4980D of the Code, (iii) Title I of ERISA, (iv) the U.S. Public Health Service
Act and (v) the provisions of the U.S. Social Security Act, in each case to the
extent applicable;

	 (cc) 	(i) 	 	neither the Company nor any of its Subsidiaries owns any real property;

	 	(ii)	 	the Company has made available to Agents the list of each
parcel of real property currently leased or subleased by the Company or any
Subsidiary (collectively, the “Leased Properties”) which list sets
forth the Company or the Subsidiary holding such leasehold interest, with the
name of the lessor and the date of the lease, sublease, assignment of the
lease, any guaranty given or leasing commissions remaining payable by the
Company or any Subsidiary in connection therewith and each material amendment
to any of the foregoing (collectively, the “Lease Documents”). The
Company or the applicable Subsidiary owns a valid leasehold

-16-

 

	 	 	 	interest in the
Leased Properties, free and clear of all Liens other than Permitted Liens.
True, correct and complete copies of all Lease Documents have been made
available to Agents. Each of the Lease Documents is valid, binding and in full
force and effect as against the Company or the Subsidiaries and, to the
Company’s knowledge, as against the other party thereto;
	 
	 	(iii)	 	neither the Company nor any Subsidiary has received written
notice under any of the Lease Documents of any default, and, to the Company’s
knowledge, no event has occurred which, with notice or lapse of time or both,
would constitute a default by the Company or the applicable Subsidiaries
thereunder which would result in a Company Material Adverse Effect; and
	 
	 	(iv)	 	to the Company’s knowledge, the Company and the Subsidiaries
own, or have valid leasehold rights to, all material furniture, fixtures,
equipment, operating supplies and other personal property (collectively, the
“Personal Property”) necessary for the operation of each Leased
Property, subject to no Liens, other
than as would not result in a Company Material Adverse Effect, in the case
of owned Personal Property. The Company owns or has a valid leasehold right
to all Personal Property at each of its locations;

	(dd) 	(i) 	 	(A) to the Company’s knowledge, the conduct of the business of the Company
and the Subsidiaries as currently conducted does not infringe upon or misappropriate
the Intellectual Property rights of any third party, and no claim has been asserted
against the Company or any Subsidiary that the conduct of the business of the Company
and the Subsidiaries as currently conducted infringes upon, or may infringe upon or
misappropriates the Intellectual Property rights of any third party; (B) with respect
to each item of Intellectual Property that is owned by the Company or a Subsidiary and
is material to its operations (“Owned Intellectual Property”), the Company or a
Subsidiary is the owner of the entire right, title and interest in and to such Owned
Intellectual Property and is entitled to use such Owned Intellectual Property in the
continued operation of its respective business; (C) with respect to each item of
Intellectual Property that is licensed to or otherwise held or used by the Company or a
Subsidiary and is material to its operations (“Licensed Intellectual
Property”), the Company or a Subsidiary has the right to use such Licensed
Intellectual Property in the continued operation of its respective business in
accordance with the terms of the license agreement governing such Licensed Intellectual
Property; (D) none of the Owned Intellectual Property has been adjudged invalid or
unenforceable in whole or in part and, to the Company’s knowledge, the Owned
Intellectual Property is valid and enforceable; (E) to the Company’s knowledge, no
person is engaging in any activity that infringes upon the Owned Intellectual Property;
(F) to the Company’s knowledge, each license of the Licensed Intellectual Property is
valid and enforceable, is binding on all parties to such license, and is in full force
and effect; (G) to the Company’s knowledge, no party to any license of the Licensed
Intellectual Property is in breach or default of any material provision thereof or
thereunder; (H) the Company has taken all reasonable actions (including executing
non-disclosure and intellectual property assignment agreements) to protect, preserve
and maintain the Owned Intellectual Property; and (I) neither the execution of this
Agreement nor the consummation of any Transaction shall adversely affect any of the
Company’s rights with respect to the Owned Intellectual Property or the Licensed
Intellectual Property;

-17-

 

	 	(ii)	 	for purposes of this Agreement, “Intellectual
Property” means (A) United States and Canadian patents, patent applications
and statutory invention registrations, (B) trademarks, service marks, trade
dress, logos, trade names, corporate names, domain names and other source
identifiers, and registrations and applications for registration thereof, (C)
copyrightable works, copyrights, and registrations and applications for
registration thereof, (D) all items of software, source code, object code or
other computer program of whatever name and (F) confidential and proprietary
information, including trade secrets and know-how;

	(ee) 	(i)	 	each of the Company and its Subsidiaries has filed all Tax Returns required
to be filed by any of them, except, where the failure to file such Tax Returns would
not, have a Company Material Adverse Effect. The Company and each of its Subsidiaries
have correctly reported all income and all other amounts or information required to be
reported to the applicable Governmental Authority with respect to any such Taxes,
except as would not result in a Company Material Adverse Effect. Copies of all
federal, state and local Tax Returns for the Company and each Subsidiary with respect
to the taxable years commencing on or after the 2007 tax year have been delivered or
made available to representatives of the Agents. To the Company’s knowledge, no
deficiencies for any Taxes have been asserted or assessed in writing against the
Company or any of its Subsidiaries as of the date of this Agreement, and no requests
for waivers of the time to assess any such Taxes are pending. There are no pending or,
to the knowledge of the Company, threatened audits, examinations, investigations or
other proceedings in respect of any Tax of the Company;

	 	(ii)	 	all material Taxes due and owing by the Company (whether or not
shown on any Tax Return) have been paid or have been properly accrued on the
Company’s Financial Statements in accordance with GAAP. The Company has
withheld all Taxes required to have been withheld in connection with amounts
paid to its employees, independent contractors, customers, shareholders and
other Persons, and has paid, or will timely pay, all amounts so withheld to the
appropriate Governmental Authority, except when failures to withhold would not
result in a Company Material Adverse Effect;
	 
	 	(iii)	 	the Company is not currently delinquent in the payment of any
Tax. There are no Tax liens on any assets of the Company, except for statutory
liens for Taxes that are not yet due and payable, liens for Taxes which are
currently payable without penalty or interest and liens for Taxes being
contested in good faith by any appropriate proceeding for which adequate
reserves have been established. There is no material Tax deficiency
outstanding or assessed or proposed against the Company that is not reflected
as a liability on the Company’s Financial Statements. The Company has not
executed any agreements or waivers extending any statute of limitations on or
extending the period for the assessment or collection of any Tax;
	 
	 	(iv)	 	the Company has not assumed any obligation to pay any Tax
obligations of, or with respect to any transaction relating to, any other
Person or agreed to indemnify any other Person with respect to any Tax;
	 
	 	(v)	 	for purposes of this Agreement:

-18-

 

	 	(A)	 	“Tax” or “Taxes” shall mean any
and all federal, state, local and foreign income, gross receipts,
license, payroll, employment, excise, severance,
stamp, occupation, premium, windfall profits, environmental, customs
duties, capital stock, franchise, profits, withholding, social
security, unemployment, disability, real property, personal property,
sales, use, transfer, registration, value added, alternative or
add-on minimum, estimated, or other taxes of any kind (together with
any and all interest, penalties, additions to tax and additional
amounts imposed with respect thereto) imposed by any governmental or
Tax authority; and
	 
	 	(B)	 	“Tax Returns” means any and all
returns, declarations, claims for refund, or information returns or
statements, reports and forms relating to Taxes filed with any Tax
authority (including any schedule or attachment thereto) with respect
to the Company or the Subsidiaries, including any amendment thereof;

	(ff) 	(i) 	 	except as would not reasonably be expected to have a Company Material
Adverse Effect: (A) to the Company’s knowledge, none of the Company or any of the
Subsidiaries has violated, or is in violation of, any Environmental Law; (B) to the
Company’s knowledge, there is and has been no Release of Hazardous Substances in
violation of Environmental Laws at, on, under or any of the properties currently leased
or operated by the Company or any of the Subsidiaries or, during the period of the
Company’s or the Subsidiaries’ lease or operation thereof, formerly leased or operated
by the Company or any of the Subsidiaries; (C) the Company and the Subsidiaries have
obtained and are and have been in material compliance with all, and have not violated
any, required Environmental Permits; (D) the Company and its Subsidiaries have not
received any written claims against the Company or any of the Subsidiaries alleging
violations of or liability or obligations under any Environmental Law;

	 	(ii)	 	for purposes of this Agreement:

	 	(A)	 	“Environmental Laws” means any Laws
(including common law) of the United States federal, state, local,
non-United States, or any other Governmental Authority; relating to (A)
Releases or threatened Releases of Hazardous Substances or materials
containing Hazardous Substances; (B) the manufacture, handling,
transport, use, treatment, storage or disposal of Hazardous Substances
or materials containing Hazardous Substances; or (C) pollution or
protection of the environment or human health and safety as affected by
Hazardous Substances or materials containing Hazardous Substances;
	 
	 	(B)	 	“Environmental Permits” means any
permit, license registration, approval, notification or any other
authorization pursuant to Environmental Law;
	 
	 	(C)	 	“Hazardous Substances” means (A) those
substances, materials or wastes defined as toxic, hazardous, acutely
hazardous, pollutants, contaminants, or words of similar import, in or
regulated under the following United States federal statutes and any
analogous state statutes, and all regulations thereunder: the Hazardous
Materials Transportation Act, the

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	 	 	 	Resource Conservation and Recovery
Act, the Comprehensive Environmental Response, Compensation and
Liability Act, the Clean Water Act, the Safe Drinking Water Act, the
Atomic Energy Act, the Federal Insecticide, Fungicide, and Rodenticide Act and the Clean Air
Act; (B) petroleum and petroleum products, including crude oil and
any fractions thereof; (C) natural gas, synthetic gas, and any
mixtures thereof; and (D) polychlorinated biphenyls, asbestos, molds
that could reasonably be expected to adversely affect human health,
urea formaldehyde foam insulation and radon; and
	 
	 	(D)	 	“Release” means any spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping,
migrating, seeping, leaching, dumping, or disposing of any substance,
material or product into or through the environment;

	(gg) 	(i) 	 	except for this Agreement, the Subscription Receipt Agreement and the
Subscription Agreements, and any Lease, as of the date hereof, neither the Company nor
any Subsidiary is a party to or bound by any of the following that were not entered in
the ordinary course of the Company or Subsidiary’s business and consistent with
historic practice:

	 	(A)	 	agreement or indenture relating to indebtedness
for borrowed money;
	 
	 	(B)	 	lease or agreement under which any Company is
lessee of or holds or operates any property (other than real property),
owned by any other party, except for any lease or agreement under which
the aggregate annual rental payments do not exceed $75,000;
	 
	 	(C)	 	lease or agreement under which any Company is
lessor of or permits any third party to hold or operate any property
(other than real property), owned or controlled by any Company, except
for any lease or agreement under which the aggregate annual rental
payments do not exceed $75,000;
	 
	 	(D)	 	contract or group of related contracts with the
same party or group of affiliated parties the performance of which
involves outstanding consideration in excess of $200,000;
	 
	 	(E)	 	agreement, contract or commitment limiting the
ability of any Company to engage, in any material respect, in any line
of business or to compete, in any material respect, with any Person; or
	 
	 	(F)	 	any collective bargaining agreement, labor
contract or other written agreement, arrangement with any labor union
or any employee organization.

	(hh) 	(i) 	 	to the Company’s Knowledge, neither the Company nor any Company Subsidiary
is in material violation of or in material default under any Material Contract to which
it is a party or by which it or any of its properties or assets is bound, except for
violations or defaults that would not, individually or in the aggregate, have a Company
Material Adverse Effect, nor will the consummation

-20-

 

	 	 	 	 and transactions contemplated herein
result in any third party having any right to terminate, amend, accelerate, cancel or
deprive the Company of a material benefit under any Material Contract, except for (A)
such rights that, if exercised, would not, individually or in the aggregate, have a
Company Material Adverse Effect and (B) any such right that is not substantially different from
rights otherwise exercisable by such third party under such Material
Contract (whether or not subject to a different notice period). No third
party consents, approvals or notices are required from, or to, any third
party pursuant to a Material Contract in order for the Company to proceed
with the execution and delivery of this Agreement and the completion of the
Transactions contemplated herein, except for any required consent that if
not obtained would not result in a Company Material Adverse Effect; and

	 	(ii)	 	(A) neither the Company nor any Subsidiary is and, to the
Company’s knowledge, no other party is in breach or violation of, or default
under, any Material Contract, (B) none of the Company or any of the
Subsidiaries have received any claim of default or notice of cancellation under
any Material Contract, and (C) to the Company’s knowledge, no event has
occurred which would result in a breach or violation of, or a default under,
any Material Contract (in each case, with or without notice or lapse of time or
both), except in either case, would not result in a Company Material Adverse
Effect. Each Material Contract is valid, binding and enforceable in accordance
with its terms and is in full force and effect. The Company has made available
to Agents true and complete copies of all Material Contracts, including any
amendments thereto;

	(ii) 	 	the Company has made available to Agents a complete and correct list of all
material insurance policies owned or held by the Company and each Subsidiary, true and
complete copies of which have been made available to Agents. With respect to each such
insurance policy: (i) the policy is legal, valid, binding and enforceable in
accordance with its terms and, except for policies that have expired under their terms
in the ordinary course, is in full force and effect; (ii) neither the Company nor any
Subsidiary is in breach or default (including any such breach or default with respect
to the payment of premiums or the giving of notice), and no event has occurred which,
with notice or the lapse of time, would constitute such a breach or default, or permit
termination or modification, under the policy; (iii) to the knowledge of the Company,
without independent inquiry, no insurer on the policy has been declared insolvent or
placed in receivership, conservatorship or liquidation; (iv) no notice of cancellation
or termination has been received by the Company or any Subsidiary; and (v) the policy
is sufficient for compliance with all requirements of Law and requirements of all
Contracts to which the Company or the Subsidiaries are parties or otherwise bound;

	(jj) 	 	Except as set forth in the Disclosure Documents, no manager, director,
executive officer or “associate” (as such terms are defined in Rule 12b-2 under the
Securities Exchange Act of 1934, as amended) of the Company owns any material direct or
indirect interest of any kind, or is a manager, director, officer, employee, partner,
member, Affiliate or associate of, or consultant or lender to, or borrower from, or has
the right to participate in the management, operations or profits of, any person or
entity which is (i) a competitor, supplier, customer, distributor, lessor, tenant,
creditor or debtor of the Company, (ii) participating in any material transaction to
which the Company is a party, or (iii) otherwise a party to any Material Contract with
the Company, other than with respect to at-will employment arrangements, written
employment arrangements or Company Plans;

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	(kk) 	 	no broker, finder or investment banker is entitled to any brokerage, finder’s
or other fee or commission in connection with the Transactions based upon arrangements
made by or on behalf of the Company other than the Agents and their respective
affiliates;

	(ll) 	 	except for the representations and warranties made by the Company in this
Section 6, the Subscription Agreements and the Subscription Receipt Agreement, the
Company makes no representations or warranties, and the Company hereby disclaims any
other representations or warranties, with respect to the Company, the Subsidiaries, or
its or their businesses, operations, assets, liabilities, condition (financial or
otherwise) or prospects or any other information or documents made available to the
Agents or its their counsel, accountants or advisors with respect to the Company or any
of the businesses, assets, liabilities or operations of the foregoing, except as
expressly set forth in this Agreement;

	(mm) 	 	the Company and the Subsidiaries have complied with all applicable Laws,
orders, judgments and decrees other than any noncompliance which would, not have a
Company Material Adverse Effect on the Company;

	(nn) 	 	no act or proceeding has been taken by or against the Company or any of the
Subsidiaries in connection with the dissolution, liquidation, winding up, bankruptcy or
reorganization of the Company or any of the Subsidiaries nor, to the knowledge of the
Company, is any threatened, or for the appointment of a trustee, receiver, manager or
other administrator of the Company or any of the Subsidiaries or any of their
respective properties or assets. None of the Company or any of the Subsidiaries has
sought protection under applicable bankruptcy legislation;

	(oo) 	 	the Company and each of the Subsidiaries, and each of their direct or indirect
owners or other financial interest holders (“Owners”), directors and employees
(“representatives”), has not and will not, for the Company or any Subsidiary, make,
offer or promise to make, or transfer any payment or anything of value, directly or
indirectly, to any Government Official, or to any third party for payment to any
Government Official, to improperly obtain, retain, or direct business or secure an
improper advantage (collectively, “Improper Conduct”) or take any action, directly or
indirectly, to violate any applicable laws and regulations prohibiting public or
commercial bribery, extortion, kickbacks, or other unlawful or improper means of
conducting business (collectively, the “Legislation”). For purposes of this Agreement,
“Government Official” means the following: officers and employees of any national,
regional, local, or other government, any private person acting in an official capacity
for or on behalf of any such governmental entity (such as a consultant retained by a
government agency), officers and employees of companies in which a government owns an
interest, candidates for political office at any level, political parties and their
officials, and officers, employees, or official representative of public
(quasi-governmental) international organizations (such as the United Nations, World
Bank, or International Monetary Fund);

	(pp) 	 	the Company and each of its Subsidiaries and each of their Owners and
directors, working for any of the, or on behalf of any of the, are knowledgeable
regarding their obligations under the Legislation and their obligation to not engage in
Improper Conduct, and have taken appropriate steps to ensure compliance with those
obligations.

-22-

 

6.3 The Company represents and warrants that:

	 	(a)	 	the Company has provided to the Agents and their counsel full access to all
material due diligence materials and information provided to it by Choice and its
counsel or independently compiled by the Company or its subsidiaries and their agents
with respect
to Choice and is not aware of any material misrepresentations or inaccuracies in
such material or information;
	 
	 	(b)	 	the Company is not aware of any information relating to Choice which could,
upon or after completion of the Acquisition by the Company, reasonably be expected to
have a material adverse effect on the business, operations, assets (including
information or data related to the estimated value or book value of assets),
liabilities, ownership, management, securities, capital, prospects or condition
(financial or otherwise) of the Company and the Subsidiaries on a consolidated basis;
and
	 
	 	(c)	 	the Company is not aware of any existing, pending or threatened fact, event,
circumstance or regulatory action that could reasonably be expected to prevent or
impede the completion of the Acquisition.

7. Covenants of the Company. The Company covenants and agrees with the Agents that:

	 	(a)	 	it will advise the Agents, promptly after receiving notice or any obtaining
knowledge thereof, of the imposition of any cease trading or similar order affecting
the Common Shares or the Subscription Receipts (or any Underlying Common Shares) or
order modifying or making unavailable any exemption pursuant to which the Subscription
Receipts (or any Underlying Common Shares) are being offered or sold, or the
institution, threatening or contemplation of any proceedings for any such purpose or
any request made by any Securities Commission relating to the Offering;
	 
	 	(b)	 	unless it would be unlawful to do so or unless the Company, acting reasonably,
determines that it would not be in the best interests of the Company to do so or would
result in non-compliance with any applicable Securities Laws or the requirements of the
Stock Exchanges, the Company will accept each duly completed and executed Subscription
Agreement and any such acceptance will be made on the Closing Date;
	 
	 	(c)	 	the Company will have taken, on or prior to the Closing Date, all necessary
steps to ensure the Subscription Receipts, the Underlying Common Shares and Penalty
Shares have been duly authorized for issuance and in respect of the Underlying Common
Shares and Penalty Shares reserved for issue to the persons entitled thereto;
	 
	 	(d)	 	the Company will conduct the Offering in accordance with the terms and
conditions in Schedule “C” hereto;
	 
	 	(e)	 	the representations and warranties of the Company in Schedule “C” hereto are
true and correct as of the Closing Date;
	 
	 	(f)	 	the Company will duly, punctually and faithfully perform all of the obligations
to be performed by it under the Subscription Agreements;
	 
	 	(g)	 	the Company will take all such steps as may be necessary to obtain conditional
listing approval of the Stock Exchanges;
	 
	 	(h)	 	except as may be provided in the Acquisition Agreement, for a period commencing
as of the date of this Agreement and ending on the later of (i) 4 months after the
Closing Date

-23-

 

	 	 	 	and (ii) the earlier of: (a) the date the Registration Statement has been
made effective; and (b) November 10, 2011, the Company agrees that it will not, and
will not announce any intention to, without the prior written consent of Clarus, which
consent shall not be unreasonably withheld: (a) provide any waivers to accelerate the
trading of any Common
Shares that are currently restricted from trading, or (b) directly or indirectly,
enter into any agreement to offer or sell any Common Shares or financial instruments
convertible or exchangeable into Common Shares, other than pursuant to: (I) the
exercise of convertible securities, options or warrants outstanding as of the date
hereof, (II) the grant or exercise of options pursuant to the Company’s Stock Option
Plan or (III) one or more arm’s length acquisitions by the Company or its
subsidiaries.
	 
	 	(i)	 	the Company will comply with all filings and other continuous disclosure
requirements under all applicable Securities Laws;
	 
	 	(j)	 	the Company will have received the approval of the Agents, acting reasonably,
regarding the form and content of the Subscription Receipt Agreement and Subscription
Receipt Certificate;
	 
	 	(k)	 	the Company will use commercially reasonable efforts to ensure that there is
available “adequate current public information” with respect to the Company within the
meaning of Rule 144(c)(1) under the U.S. Securities Act after the Closing Date and at
all times thereafter when the Registration Statement is not effective and up to date;
	 
	 	(l)	 	the Company will use all commercially reasonable efforts to complete the
Acquisition on or before the Termination Time as contemplated in the Acquisition
Agreement (provided that the Company will not be required under this paragraph (l) to
waive any condition to its obligation to complete the Acquisition that it would not
otherwise choose, using commercially reasonable judgment, to waive);
	 
	 	(m)	 	the Company will promptly notify the Agents of any proposed material amendments
or changes to, or waivers of, any terms of conditions of the Acquisition Agreement that
would result in the material terms of the Acquisition differing from those described to
subscribers and will not agree to any such amendments, changes or waivers without the
prior consent of the Agents, such consent not to be unreasonably withheld; and
	 
	 	(n)	 	to the extent practicable, the Company will provide to the Agents three days
advance written notice of the proposed closing of the Acquisition and prompt written
notice to the Agents if the Acquisition Agreement is terminated.

8. Due Diligence. Until the Closing Date the Company shall at all times allow Clarus and their
representatives, on behalf of the Agents, to conduct all due diligence investigations and
examinations which Clarus may reasonably require in order to fulfil their obligations as Agents, in
order to avail themselves of a defence to any claim.

9. Indemnity and Contribution.

9.1 The Company agrees to indemnify and hold harmless the Agents and each of their directors,
officers, employees, partners, agents, representatives and shareholders (collectively, the
“Indemnified Parties” and individually, an “Indemnified Party”), if it is lawful to do so, from and
against any and all losses (other than any loss of profits or consequential damages), reasonable
expenses, claims, actions, damages and liabilities, joint or several (including the aggregate
amount paid in

-24-

 

reasonable settlement of any actions, suits, proceedings, investigations or claims
and the reasonable fees and expenses of their counsel that may be incurred in advising with respect
to and/or defending any action, suit, proceeding, investigation or claim that may be made or
threatened against any Indemnified Party) (collectively, “Losses”) to which any Indemnified Party
may become subject or otherwise involved in any capacity under any Law or otherwise insofar as such
Losses relate to, are caused by, result from,
arise out of or are based upon, directly or indirectly, the performance of the Agents’ obligations
to the Company under this Agreement or otherwise in connection with the matters referred to in this
Agreement, provided, however, that this indemnity shall not apply to the extent that a court of
competent jurisdiction in a final judgment that has become non-appealable shall determine that:

	 	(i)	 	any Indemnified Party has been grossly negligent, has committed a violation of
Law or has committed any fraudulent act or wilful misconduct in the course of such
performance; and
	 
	 	(ii)	 	the expenses, losses, claims, actions, damages or liabilities, as to which
indemnification is claimed, were directly caused by the gross negligence, violation of
Law, fraud or wilful misconduct referred to in (i).

9.2 If for any reason (other than determinations as to any of the events referred to in clauses (i)
and (ii) of Section 9.1) the foregoing indemnification is unavailable to the Agents or any other
Indemnified Party or insufficient to hold the Agents or any other Indemnified Party harmless, then
the Company shall contribute to the amount paid or payable by the Agents or the other Indemnified
Parties as a result of such Loss in such proportion as is appropriate to reflect not only the
relative benefits received by the Company on the one hand and the Agents or any other Indemnified
Party on the other hand but also the relative fault of the Company, the Agents or any other
Indemnified Party, as well as any relevant equitable considerations, provided that the Company
shall in any event contribute to the amount or amounts paid or payable by the Agents or any other
Indemnified Party as a result of any such expense, Loss the portion of such amount or of the
aggregate of such amounts that is in excess of the value of the commission received by the Agents
under this Agreement.

9.3 The Company agrees that in case any legal proceeding shall be brought against the Company
and/or the Agents or any other Indemnified Party by any person or entity, including without
limitation any Governmental Authority, stock exchange or other entity having regulatory authority,
either domestic or foreign, or if any such persons shall investigate the Company and/or the Agents
or any other Indemnified Party and the Agents or such other Indemnified Party shall be required to
testify in connection therewith or shall be required to respond to procedures designed to discover
information regarding, in connection with, or by reason of the performance of the Agents’
obligations to the Company under this Agreement, the Agents or such other Indemnified Party shall
have the right to employ their own counsel in connection therewith, and the reasonable fees and
expenses of such counsel as well as the reasonable costs (including reasonable amounts to reimburse
the Agents for time spent by its officers, employees or partners (collectively, “Personnel”)) in
connection therewith and out of pocket expenses incurred by the Agents, its Personnel or such other
Indemnified Party in connection therewith shall be paid by the Company as they occur.

9.4 Promptly after receipt of notice of any action, suit, proceeding, claim or investigation
against either of the Agents or any other Indemnified Party or receipt of notice of the
commencement of any investigation, which is based, directly or indirectly, upon any matter in
respect of which indemnification may be sought from the Company, the Agents will notify the Company
and, unless the Company assumes the defence thereof, will keep the Company advised of the progress
thereof and will discuss all significant actions proposed. The omission to so notify the Company
shall not relieve the Company of any liability which the Company may have to the Agents or any
other Indemnified Party

-25-

 

except only to the extent that any such delay in or failure to give notice
as herein required prejudices the defence of such Action, suit, proceeding, claim or investigation
or results in any material increase in the liability which the Company would otherwise have under
this indemnity had the Agents not delayed in giving or failed to give the notice required
hereunder.

9.5 The Company shall be entitled, at its own expense, to participate in any action, suit,
proceeding or claim or investigation and to the extent it may wish to do so, assume the defence
thereof, provided such defence is conducted by experienced and competent counsel. Upon the Company
notifying the Agents in writing of its election to assume the defence and retaining counsel, the
Company shall not be liable to the Agents or any other Indemnified Party for any legal expenses
subsequently incurred by them in connection with such defence. If such defence is assumed by the
Company, the Company throughout the course thereof will provide copies of all relevant
documentation to the Agents, will keep the Agents advised of the progress thereof and will discuss
with the Agents all significant actions proposed.

9.6 Notwithstanding the foregoing Section 9.5, any Indemnified Party shall have the right to employ
counsel of such Indemnified Party’s choice, in respect of the defence of any action, suit,
proceeding, claim or investigation if: (i) such counsel has been reasonably acceptable by the
Company; or (ii) the Company has not assumed the defence and employed counsel therefore within a
reasonable time after receiving notice of such action, suit, proceeding, claim or investigation in
which case such counsel shall be at the Company’s expense; or (iii) counsel retained by the Company
or the Indemnified Party has advised the Indemnified Party that representation of both parties by
the same counsel would be inappropriate because there may be legal defences available to the
Indemnified Party which are different from or in addition to those available to the Company (in
which event and to that extent, the Company shall not have the right to assume or direct the
defence on the Indemnified Party’s behalf) or that there is a conflict of interest between the
Company and the Indemnified Party (in which event the Company shall not have the right to assume or
direct the defence on the Indemnified Party’s behalf).

9.7 No admission of liability and no settlement of any action, suit, proceeding, claim or
investigation shall be made by the Company without the consent of the Indemnified Parties affected,
such consent not to be unreasonably withheld. No admission of liability shall be made by any
Indemnified Party and the Company shall not be liable for any settlement of any action, suit,
proceeding, claim or investigation made by the Indemnified Party without the Company’s consent,
such consent not to be unreasonably withheld.

9.8 The Company hereby acknowledges that the Agents act as trustee for the other Indemnified
Parties of the Company’s covenants under this indemnity with respect to such persons and the Agents
agree to accept such trust and to hold and enforce such covenants on behalf of such persons.

9.9 The Company agrees to waive any right it may have of first requiring any Indemnified Party to
proceed against or enforce any other right, power, remedy or security or claim for payment from any
other person before claiming under this indemnity.

9.10 The indemnity and contribution obligations of the Company hereunder shall be in addition to,
but not in duplication of, any liability which the Company may otherwise have, shall extend upon
the same terms and conditions to the Indemnified Parties and shall be binding upon and enure to the
benefit of any successors, assigns, heirs and personal representatives of the Company, the Agents
and any other Indemnified Party. The foregoing provisions shall survive the completion of the
transactions contemplated under this Agreement and the termination of this Agreement.

-26-

 

10. Conditions of Closing. The obligations of the Agents to deliver at the Closing Time executed
Subscription Agreements shall be conditional upon the Agents being satisfied with the results of
their due diligence investigations (subject to Section 8) relating to the Company and upon the
fulfilment or waiver by the Agents at or before the Closing Time of the following conditions, which
conditions the Company covenants to use its best efforts to fulfil or cause to be fulfilled prior
to the Closing Time:

	 	(a)	 	the execution and delivery of this Agreement, the Subscription Agreements, the
Subscription Receipt Agreement and the creation and issuance of the Subscription
Receipts the due authorization of the issuance of the Underlying Common Shares and
Penalty Shares and the allotment and reservation of the Underlying Common Shares and
Penalty Shares shall have been duly authorized by all necessary corporate action;
	 
	 	(b)	 	any necessary consents or approvals of the Securities Regulators with respect
to the issue and sale of the Subscription Receipts shall have been obtained, and the
conditional approval of the Stock Exchanges to list the Underlying Common Shares and
Penalty Shares shall have been obtained;
	 
	 	(c)	 	the Agents shall have received certificates addressed to the Agents and to the
Subscribers, dated as of the date of Closing, signed by the President and the Chief
Executive Officer of the Company, or such other officer or officers of the Company as
the Agents may accept, certifying on behalf of the Company to the effect that, except
as has been generally disclosed at the date thereof:

	 	(i)	 	no order, ruling or determination suspending or cease trading
the Common Shares has been issued, and no proceedings for that purpose have
been instituted or, to the knowledge of such officer, contemplated or
threatened by any Securities Commission;
	 
	 	(ii)	 	other than as disclosed in the Disclosure Documents, since
November 9, 2010 there has not been any material change as it relates to the
Company and its Subsidiaries on a consolidated basis;
	 
	 	(iii)	 	other than as disclosed in the Disclosure Documents, since
November 9, 2010 no material fact has arisen or has been discovered which would
have been required to have been stated in the Disclosure Documents had the fact
arisen or been discovered on, or prior to the date of such Disclosure
Documents;
	 
	 	(iv)	 	the representations and warranties of the Company contained in
this Agreement are true and correct in all material respects as of the Closing
Time with the same force and effect as if made at and as of the Closing
Time;
	 
	 	(v)	 	the Company has complied in all material respects with all
the terms and conditions of this Agreement on its part to be complied with at
or before the Closing Time; and
	 
	 	(vi)	 	as to such other matters of a factual nature as are appropriate
and usual in the circumstances and as the Agents or the Agents’ Counsel may
reasonably request;

	 	(d)	 	the Company shall have delivered lock-up agreements executed by each director
and senior executive officer of the Company in the form attached hereto as Schedule “E”
or in such other form as is acceptable to the Agents;

-27-

 

	 	(e)	 	subject to the Conditions, the Agents shall have received favourable legal
opinions, in a form satisfactory to the Agents, acting reasonably, dated as of the date
of Closing, from Akerman Senterfitt, United States counsel to the Company, and Osler,
Hoskin & Harcourt LLP, Canadian counsel to the Company substantially addressing the
matters annexed hereto as Schedule “B” and where appropriate, counsel in the other
Selling Jurisdictions and other jurisdictions as may be required addressed to the
Agents and to the Subscribers
with respect to such matters as the Agents may reasonably request prior to the
Closing Time;
	 
	 	(f)	 	the Company shall have delivered the certificates representing the Subscription
Receipts; and
	 
	 	(g)	 	the Agents shall have received the Agents’ Commission and reimbursement for
expenses incurred to the Closing Date in the manner specified in Sections 4 and 12 to
the extent such expenses are documented in writing and delivered on the Business Day
prior to the Closing Date.

               In providing such opinions, counsel may, where appropriate, rely on the opinions of other
counsel as to matters mentioned therein relating to jurisdictions where Company’s counsel does not
practice law and on certificates or letters of the auditors, of the officers of the Company, of the
transfer agents of the Company and public officials as to factual matters relevant to such
opinions.

11. Closing Procedures. Provided duly executed Subscription Agreements have been delivered to the
Company’s counsel, the Company will cause to be issued and to be delivered to the Agents at the
offices of Osler, Hoskin & Harcourt LLP in Toronto, Ontario (or such other place or places as the
Agents may reasonably direct) without charge at the Closing Time and contemporaneously with the
delivery to the Company of the aggregate Subscription Receipt Price for all Subscription Receipts,
certificates representing the Subscription Receipts in such number and denomination and bearing the
registration particulars as the Agents may, in writing, direct to the Company prior to the Closing
Time.

12. Expenses of Offering. Whether or not the transactions herein contemplated shall be completed,
all costs and expenses of and incidental to the sale of the Subscription Receipts to the
Subscribers and all other matters in connection with the transactions herein set out shall be borne
by the Company, whether before or after Closing, including without limitation, all costs and
expenses in connection with the preparation and issue of the certificates for the securities to be
offered hereunder, the fees and disbursements of the Company’s counsel, all local counsel and the
expenses of the Agents in connection with the Offering including without limitation the reasonable
fees and expenses of the Agents’ counsel, and the Agents’ out of pocket expenses, collectively to a
maximum of $160,000 (exclusive of taxes thereon, if applicable). Any expenses incurred in excess
of this maximum shall be subject to pre-approval by the Company, acting reasonably. The Company
shall be responsible for the payment of any applicable sales taxes on the foregoing amounts.

               Subject to the maximum amounts set out above, the Agents may render accounts to the Company
from time to time, for their expenses, for payment on or before the date set out in the accounts.
The Company will pay to the Agents the reasonable expenses in connection with the Offering of the
Agents by; (i) cheque at the Closing Date; and (ii) the Agents may instruct, with the consent of
the Company, the Subscription Receipt Agent to deduct by way of setoff any unpaid amount of such
expenses from the gross proceeds of the Offering when paid to the Company.

-28-

 

13. Termination.

13.1 If at any time prior to Closing:

	 	(a)	 	there shall have occurred any adverse material changes or the Agents shall
discover any previously undisclosed adverse material fact (determined by the Agents,
acting reasonably) in relation to the Company that, in the opinion of the Agents,
acting reasonably and in good faith, has or could reasonably be expected to result in a
Company Material Adverse Effect;
	 
	 	(b)	 	there shall have occurred any change in the Securities Laws, or any inquiry,
investigation or other proceeding is made or any order is issued under or pursuant to
any statute of the US or Canada or the Selling Jurisdictions or any Stock Exchange in
relation to the Company or any of the Securities (except for any inquiry, investigation
or other proceeding or order based upon activities of the Agents and not upon
activities of the Company or its subsidiaries), which, in the opinion of the Agents,
acting reasonably and in good faith, prevents or restricts trading in or the
distribution of the Securities or adversely affects or might reasonably be expected to
adversely affect the investment quality or marketability of the Subscription Receipts;
	 
	 	(c)	 	if there should develop, occur or come into effect or existence any event,
action, state, condition or major financial occurrence of national or international
consequence or any law or regulation, which, in the opinion of the Agents, acting
reasonably and in good faith, seriously adversely affects, or involves, or will
seriously adversely affect or involve, the financial markets or the business,
operations or affairs of the Company and the Subsidiaries taken as a whole or the
ability of the Agents to perform their obligations under this Agreement; or
	 
	 	(d)	 	a cease trading order is made under any of the Securities Laws by any other
competent authority in respect of the Securities and such cease trading order is not
rescinded within 48 hours,

the Agents shall be entitled, at their option, to terminate and cancel their obligations to the
Company under this Agreement by written notice to that effect given to the Company at the address
shown in Section 15.3 prior to the Closing Time. In the event of any such termination, the
Company’s obligations under this Agreement to the Agents shall be at an end except for any
liability of the Company provided for in Sections 9 and 12 hereof.

13.2 The rights of termination contained in this Section 13 are in addition to any other rights or
remedies the Agents may have in respect of any default, misrepresentation, act or failure to act of
the Company in respect of any matters contemplated by this Agreement.

14. Agents’ Obligations.

14.1 The Agents represent, warrant and covenant to the Company as follows:

	 	(a)	 	the Agents have complied and will comply with all Securities Laws and all other
applicable laws and regulations or similar enactments applicable in respect of the
Offering in each of the jurisdictions in which they may offer or sell the Subscription
Receipts;

-29-

 

	 	(b)	 	the Agents will conduct the Offering in accordance with the terms and
conditions in Schedule “C” hereto;
	 
	 	(c)	 	the representations and warranties of the Agents in Schedule “C” hereto are
true and correct as of the Closing Date;
	 
	 	(d)	 	the Agents are appropriately registered under the Securities Laws of the
Selling Jurisdictions to permit them to lawfully fulfil their obligations hereunder;
and
	 
	 	(e)	 	the Agents have not directly or indirectly, offered, sold or delivered any
Subscription Receipts to any person in any jurisdiction other than in the Selling
Jurisdictions, and in all cases except in a manner which is exempt from registration
and prospectus requirements
under applicable securities laws and which, other than Registration Statement, does
not require the Company to file a prospectus, an offering memorandum, or similar
document to register any of its securities or to comply with ongoing filing or
disclosure or other similar requirements, under the laws of any jurisdiction.

	15.	 	Miscellaneous.

15.1 All representations and warranties contained herein and all of the covenants and agreements of
the Company herein, to the extent that they are required to be performed on or before Closing,
shall be construed as conditions and any material breach or failure to comply with any thereof
shall entitle the Agents, in addition to and not in lieu of any other remedies the Agents have in
respect thereof, to terminate any obligation to purchase the Subscription Receipts by written
notice to that effect given to the Company prior to the Closing Time. It is understood that the
Agents may waive in whole or in part or extend the time for compliance with any of such terms and
conditions without prejudice to its rights in respect of any other of such terms and conditions or
any other subsequent breach or non-compliance, provided that to be binding on the Agents any such
waiver or extension must be in writing.

15.2 Clarus is hereby authorized by Broadband Capital Management LLC and TD Securities Inc. to act
on their behalf and the Company shall be entitled to and shall act on any notice given in
accordance with this Agreement or any agreement entered into by or on behalf of the Agents by
Clarus which represents and warrants that it has irrevocable authority to bind the Agents, except
in respect of any consent to a settlement pursuant to Section 9 which consent shall be given by the
Indemnified Party or a notice of termination pursuant to Section 13 which notice may be given by
any of the Agents.

15.3 Any notice or other communication hereunder shall be in writing and shall unless herein
otherwise provided be given by delivery to a responsible officer of the addressee or by telex or
telecopier, if to the Company, addressed to: Swisher Hygiene Inc., 4725 Piedmont Row Drive, Suite
400, Charlotte, North Carolina, 28210 (Attention: President and Chief Executive Officer)
(telecopier: (704) 602-7970); and if to the Agents addressed to: Clarus Securities Inc., Suite
1615, 200 Burrard Street, Vancouver, BC, V6C 3L6 (Attention: Rod Campbell) (telecopier (604)
605-5704) and shall be deemed to have been given when actually delivered or when such notice should
have reached the addressee in the ordinary course.

15.4 Time shall be of the essence of the foregoing offer and of the agreement resulting from the
acceptance thereof.

15.5 The representations, warranties, covenants and other agreements herein contained shall survive
the purchase by the Subscribers of the Subscription Receipts and shall continue in full force and
effect unaffected by any subsequent disposition by the Subscribers of the Subscription Receipts or
the

-30-

 

underlying securities for a period of two years after the closing of the Acquisition (other
than obligations of the Company set forth in Sections 9 and 12 hereof which will continue
indefinitely).

15.6 This Agreement may be executed in any number of counterparts, each of which when delivered,
either in original or facsimile form, shall be deemed to be an original and all of which together
shall constitute one and the same document.

15.7 This Agreement shall be governed by the laws of the Province of Ontario and the federal laws
of Canada applicable therein.

15.8 The provisions herein contained and in the Subscription Agreements and the Subscription
Receipt Agreement constitute the entire agreement between the parties and supersede all previous
communications, representations, understandings and agreements between the parties with respect to
the
subject matter hereof whether verbal or written including the engagement letter dated February 3,
2011 and February 11, 2010.

15.9 Time shall be of the essence.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

-31-

 

          If the foregoing is in accordance with your understanding, will you please confirm your
acceptance by signing the enclosed copies in the place indicated and by returning the same to us.

	 	 	 	 	 
	Yours very truly,

CLARUS SECURITIES INC.

 	 	 
	By:  	/s/ Rod Campbell
 	 	 
	 	Rod Campbell 	 	 
	 	Managing Director, Investment Banking 	 	 
	 
	BROADBAND CAPITAL MANAGEMENT LLC.

 	 	 
	By:  	/s/ Phillip Wagenheim
 	 	 
	 	Phillip Wagenheim 	 	 
	 	Vice Chairman 	 	 
	 
	TD SECURITIES INC.

 	 	 
	By:  	/s/ Roman Gula
 	 	 
	 	Roman Gula 	 	 
	 	Vice President and Director 	 	 
	 

The foregoing is in accordance with our understanding and is accepted and agreed to by as of the
23rd day of February, 2011.

	 	 	 	 	 
	SWISHER HYGIENE INC.

 	 	 
	By:  	/s/ Tom Aucamp
 	 	 
	 	Tom Aucamp 	 	 
	 	Senior Vice President 	 	 
	 

-32-

 

SCHEDULE “A”

SUBSCRIPTION INSTRUCTIONS

Please make sure that your subscription includes:

	 	1.	 	one (1) signed copy of the Subscription Agreement with the information on pages
2, 3 and 4 completed;
	 
	 	2.	 	an amount equal to the aggregate Subscription Price, payable in Canadian funds:

	 	(i)	 	IF THE SUBSCRIBER IS NOT RESIDENT IN THE UNITED STATES, by way of a
certified cheque or bank draft to “Clarus Securities Inc.” unless other
acceptable payment arrangements have been made; or
	 
	 	(ii)	 	IF THE SUBSCRIBER IS RESIDENT IN THE UNITED STATES, as instructed by
Broadband Capital Management LLC;

	 	3.	 	IF THE SUBSCRIBER IS RESIDENT IN CANADA, a duly completed and executed (i)
Certificate of Subscribers in the form of Schedule “C”, (ii) a Canadian Accredited
Investor Certificate in the form of Schedule “D”, and (iii) a Questionnaire in the
form of Annex B to Schedule “F”;
	 
	 	4.	 	IF THE SUBSCRIBER IS RESIDENT IN THE UNITED STATES, a duly completed and
executed (i) Certificate of Subscribers in the form of Schedule “C”, and (ii) a
Questionnaire in the form of Annex B to Schedule “F”; and
	 
	 	5.	 	IF THE SUBSCRIBER IS NOT RESIDENT IN CANADA OR THE UNITED STATES, a duly
completed and executed (i) Certificate of Subscribers in the form of Schedule “C”,
(ii) a Certificate of Non-Canadian Subscribers in the form of Schedule “E”, and
(iii) a Questionnaire in the form of Annex B to Schedule “F”.

Please deliver your subscription to:

For Canadian Subscribers and Other Subscribers
not Resident in the US:

Clarus Securities Inc.

Exchange Tower, 130 King Street West,

Suite 3640

Toronto, Ontario M5X 1A9

Attention: April Cuadra

Fax: (416) 343-2799

For US Subscribers:

Broadband Capital Management LLC

712 5th Avenue

22nd Floor

New York, New York 10019

Attention: Erika Duckett

Fax (212) 702-9830

 

SUBSCRIPTION AGREEMENT FOR SUBSCRIPTION RECEIPTS

The securities subscribed for herein have not been and will not be registered under the United
States Securities Act of 1933, as amended, and, subject to certain exceptions, may not be offered
or sold in the United States or to a U.S. Person. The sale contemplated hereby is being made in
reliance on a private placement exemption to “accredited investors” that satisfy the criteria set
forth in Rule 501(a) of Regulation D under the United States Securities Act of 1933, as amended.

	 	 	 
	TO:
	 	SWISHER HYGIENE INC. (the “Company”)

	 	 	 

	AND TO:
	 	CLARUS SECURITIES INC., BROADBAND CAPITAL MANAGEMENT LLC and TD
SECURITIES INC. (the “Agents”)

The undersigned (hereinafter referred to as the “Subscriber”) hereby irrevocably subscribes for and
agrees to purchase from the Company that number of subscription receipts set forth below (the
"Subscription Receipts”) for the aggregate consideration set forth below, representing a
subscription price of $4.75 (CDN) per Subscription Receipt, upon and subject to the terms and
conditions set forth in “Terms and Conditions of the Subscription for Subscription Receipts”
attached hereto as Schedule “A” and as set forth in the other applicable schedules hereto (the
"Offering”). Each Subscription Receipt will entitle the holder to receive on the closing of the
Acquisition (as defined below) without additional consideration, one share of common stock of the
Company (a “Common Share”). In the event the closing of the Acquisition does not take place by the
Termination Time (as defined herein), the Subscription Receipt Agent and the U.S. Escrow Agent
(each as defined herein), as applicable, shall return to holders of Subscription Receipts,
commencing on the fifth Business Day following the Termination Time, an amount equal to the full
Subscription Amount therefore and their pro rata entitlement to interest actually earned on such an
amount in accordance with the terms of the Subscription Receipt Agreement (as defined herein).

SUBSCRIPTION AND SUBSCRIBER INFORMATION

Please print all information (other than signatures), as applicable, in the space provided below

 

 

 

(Name of Subscriber — please print) 

 

 

 

 

			
	By:	 	 

                  
                  (Authorized Signature)

			
		 	 

 

(Please print name of individual whose signature appears above
if different than the name of the subscriber printed above and
title, if applicable.)

 

 

 

 

(Subscriber’s Address)

 

 

 

(Telephone Number)

  

 

 

(Fax Number)                                (E-mail Address)

 

Number of Subscription

Receipts:                                           

Aggregate Consideration:

$                                           

(number of Subscription Receipts x CDN$4.75)

(the “Subscription Amount”)

 

 

If the subscriber is signing as agent for a principal and the
subscriber is not a trust corporation or a person purchasing
as trustee or agent for accounts fully managed by it, in each
case satisfying the criteria set forth in National Instrument
45-106, complete the following:

 

 

 

 

(Name of Principal)

 

 

 

(Principal’s Address)

 

 

 

(Telephone Number)

 

 

 

(Fax Number)                                (E-mail Address)

 

 

-2-

 

Register the Subscription Receipts as set forth below:

 

 

(Name)

 

 

(Account Reference, if applicable)

 

 

(Address)

 

 

 

 

Deliver the Subscription Receipts as set forth below:

 

 

(Name)

 

 

(Account Reference, if applicable)

 

 

(Contact Name)

 

 

(Address)

 

 

(Telephone Number)

 

Present Ownership of Securities

The Subscriber either [check appropriate box]:

			
	o	 	owns directly or indirectly, or exercises control or direction over,                                Common
Shares and convertible securities entitling the holder thereof to acquire an additional
                               Common Shares; or

			
	o	 	does not own directly or indirectly, or exercise control or direction over, Common Shares of
the Company or securities convertible into Common Shares.

Insider Status

The Subscriber [check the box]:

			
	o	 	is not an “Insider” of the Company.

“Insider” means:

	 	(a)	 	a director or officer of the Company;
	 
	 	(b)	 	a director or officer of a person or company that is itself an insider or
subsidiary of the Company;
	 
	 	(c)	 	a person or company who beneficially owns, directly or indirectly, voting
securities of the Company or who exercises control or direction over, directly or
indirectly, voting securities of the Company or a combination of beneficial ownership
of, and control or direction over, directly or indirectly, of securities of the Company
carrying more than 10% of the voting rights attached to all voting securities of the
Company for the time being outstanding; or
	 
	 	(d)	 	the Company itself, if it has purchased, redeemed or otherwise acquired any
securities of its own issue, for so long as it continues to hold those securities.

* * * * * * *

The following Schedules are attached to and incorporated by reference in this Subscription
Agreement and are deemed to be a part hereof:

	 	 	 	 	 
	Schedule “A”
	 	-
	 	Terms and Conditions of Subscriptions for Subscription Receipts

	Schedule “B”
	 	-
	 	Term Sheet

	Schedule “C”
	 	-
	 	Certificate of Subscribers

	Schedule “D”
	 	-
	 	Canadian Accredited Investor Certificate

	Schedule “E”
	 	-
	 	Certificate of Non-Canadian Subscribers (Other than U.S.
Subscribers)

	Schedule “F”
	 	-
	 	Terms and Conditions of Registration Rights

	Schedule “G”
	 	-
	 	Current 34 Act Filings

-3-

 

Unless otherwise specified, all dollar amounts referred to in this Subscription Agreement are in
Canadian dollars.

ACCEPTANCE:
The Company hereby accepts the above subscription this ___ day of ___,
2011.

	 	 	 	 	 
	 	SWISHER HYGIENE INC.

 	 
	 	Per:
 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

-4-

 

SCHEDULE “A”

TERMS AND CONDITIONS OF SUBSCRIPTION FOR SUBSCRIPTION RECEIPTS

ARTICLE 1 — INTERPRETATION

1.1 Definitions

     Whenever used in this Subscription Agreement, unless there is something in the subject matter
or context inconsistent therewith, the following words and phrases shall have the respective
meanings ascribed to them as follows:

“Accredited Investor” means those “accredited investors” specified in Rule 501(a) of Regulation D
and, where the Subscriber is a Canadian resident, National Instrument 45-106 — Prospectus and
Registration Exemptions.

“Acquisition” shall have the meaning ascribed to such term in Section 3.2.

“Acquisition Agreement” shall have the meaning ascribed to such term in Section 3.2.

“Agency Agreement” means the Agency Agreement to be dated as of the Closing Date entered into
between the Agents and the Company in respect of the Offering.

“Agents” shall have the meaning ascribed to such term on the face page of this Subscription
Agreement.

“Business Day” means a day other than a Saturday, Sunday or any other day on which the principal
chartered banks located in Toronto, O.N. or Charlotte, North Carolina are not open for business.

“Closing” shall have the meaning ascribed to such term in Section 3.1.

“Closing Date” shall have the meaning ascribed to such term in Section 3.1.

“Closing Time” shall have the meaning ascribed to such term in Section 3.1.

“Common Share” means a share of common stock of the Company, U.S.$0.001 par value per share and
evidencing an equal undivided beneficial interest in the Company.

“Control Person” means a person, company or combination of persons or companies described in
clause (c) of the definition of “distribution” in subsection 1(1) of the Securities Act (Ontario).

“Company” means Swisher Hygiene Inc. and includes any successor corporation to or of the Company.

“Insider” means (a) a director or officer of the Company, (b) a director or officer of a person or
company that is an insider or subsidiary of the Company, (c) a person or company who beneficially
owns, directly or indirectly, voting securities of the Company or who exercises control or
direction over, directly or indirectly, voting securities of the Company or a combination of
beneficial ownership of, and control or direction over, directly or indirectly, of securities of
the Company carrying more than 10% of the voting rights attached to all voting securities of the
Company for the time being outstanding, or (d) the Company itself, if it has purchased, redeemed or
otherwise acquired any securities of its own issue, for so long as it continues to hold those
securities.

“Nasdaq” means the NASDAQ Global Market.

“Offering” shall have the meaning ascribed to such term on the page 2 of this Subscription
Agreement, for an aggregate offering of up to 12,262,500 Subscription Receipts for an aggregate
Subscription Amount of $58,246,875 (CDN).

A-1 

 

“Penalty Shares” has the meaning set out in Section 2(e) of Schedule F.

“person” means and includes individuals, corporations, limited partnerships, general partnerships,
joint stock companies, limited liability companies, joint ventures, associations, companies,
trusts, banks, trust companies, pension funds, business trusts or other organizations, whether or
not legal entities and governments, governmental agencies and political subdivisions thereof.

“Regulation D” means Regulation D adopted by the SEC under the U.S. Securities Act.

“Regulation S” means Regulation S adopted by the SEC under the U.S. Securities Act.

“Right” shall have the meaning ascribed to such term in Section 2.2.

“Securities” means the Subscription Receipts, the Common Shares and the Penalty Shares.

“Securities Laws” means, as applicable, the securities laws, regulations, rules, rulings and orders
in each of the Selling Jurisdictions, and the notices, policies and written interpretations issued
by the Securities Regulators in each of the Selling Jurisdictions, and the rules of the TSX and
Nasdaq.

“Securities Regulators” means the securities commissions or other securities regulatory authorities
of all of the Selling Jurisdictions or the relevant Selling Jurisdiction as the context so
requires.

“Selling Jurisdictions” means each of the provinces of Canada and the United States and such other
jurisdictions which are agreed to by the Company and the Agents; and “Selling Jurisdiction” means,
in the case of any Subscriber, the jurisdiction in which such Subscriber is resident.

“Subscriber” means the subscriber for the Subscription Receipts as set out on page 1 of this
Subscription Agreement.

“Subscription Agreement” means this subscription agreement (including any schedules hereto) and any
instrument amending this Subscription Agreement; “hereof”, “hereto”, “hereunder”, “herein” and
similar expressions mean and refer to this Subscription Agreement and not to a particular Article
or Section; and the expression “Article” or “Section” followed by a number means and refers to the
specified Article or Section of this Subscription Agreement.

“Subscription Amount” means an amount equal to the Subscription Receipt Price multiplied by the
number of Subscription Receipts subscribed for by the Subscriber and paid for pursuant to this
Subscription Agreement.

“Subscription Receipt Agent” means Equity Financial Trust Company.

“Subscription Receipt Agreement” shall have the meaning ascribed to such term in Section 2.3.

“Subscription Receipts” shall have the meaning ascribed to such term on page 2 of this Subscription
Agreement.

“Subscription Receipt Price” means the subscription price per Subscription Receipt under this
Offering.

“Term Sheet” means the term sheet delivered to potential purchasers of the Subscription Receipts, a
copy of which is attached hereto as Schedule “B”.

“Termination Time” means 11:59 p.m. (Toronto time) on March 31, 2011.

“TSX” means the Toronto Stock Exchange.

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

A-2 

 

“U.S. Escrow Agent” means Continental Stock Transfer & Trust Co.

“U.S. Person” shall have the meaning ascribed to such term in Rule 902(k) of Regulation S under the
U.S. Securities Act.

“U.S. Securities Act” means the United States Securities Act of 1933, as amended.

1.2 Gender and Number

     Words importing the singular number only shall include the plural and vice versa, words
importing the masculine gender shall include the feminine gender and words importing persons shall
include firms and corporations and vice versa.

1.3 Currency

     Unless otherwise specified, all dollar amounts in this Subscription Agreement, including the
symbol “$”, are expressed in Canadian dollars.

1.4 Subdivisions, Headings and Table of Contents

     The division of this Subscription Agreement into Articles, Sections, Schedules and other
subdivisions and the inclusion of headings are for convenience of reference only and shall not
affect the construction or interpretation of this Subscription Agreement. The headings in this
Subscription Agreement are not intended to be full or precise descriptions of the text to which
they refer. Unless something in the subject matter or context is inconsistent therewith, references
herein to an Article, Section, Subsection, paragraph, clause or Schedule are to the applicable
article, section, subsection, paragraph, clause or schedule of this Subscription Agreement.

ARTICLE 2 — SUBSCRIPTION AND DESCRIPTION OF SUBSCRIPTION RECEIPTS

2.1 Subscription for the Subscription Receipts

     The Subscriber hereby confirms its irrevocable subscription for and offer to purchase
Subscription Receipts from the Company, on and subject to the terms and conditions set out in this
Subscription Agreement, for the Subscription Amount which is payable as described in Article 3
hereto.

2.2 Issuance of Rights

     Each Subscription Receipt will be issued together with, and shall have attached thereto, one
right (“Right”), with each Right entitling the holder upon the conversion of such Subscription
Receipt into one Common Share as contemplated by Section 2.3, and only on the terms and conditions
and under the circumstances as described in Schedule “F”, to be issued one-tenth of one Common
Share (provided that the total number of Common Shares to be issued shall be rounded down to the
nearest whole number of Common Shares, with no cash payment being made for the fractional share).
Unless the context otherwise requires, all references to “Subscription Rights” and “Common Shares”
include the Rights attached thereto.

2.3 Creation and Issuance of Subscription Receipts

     The Subscription Receipts shall be created and issued pursuant to a subscription receipt
agreement (the “Subscription Receipt Agreement”) to be entered into between the Company, the
Subscription Receipt Agent, the U.S. Escrow Agent and the Agents to be dated as of the Closing
Date. The specific attributes of the Subscription Receipts shall be set forth in the Subscription
Receipt Agreement.

A-3 

 

     The Subscription Receipt Agreement will provide, among other items, that the Subscription
Receipts will automatically convert into Common Shares on the closing of the Acquisition, without
any action, including additional payment, required on the part of the holders thereof.

     In the event that the closing of the Acquisition does not take place by the Termination Time,
the Subscription Receipt Agent shall return to the Canadian and non-U.S. holders of Subscription
Receipts, and the U.S. Escrow Agent shall return to the U.S. holders of Subscription Receipts,
commencing on the fifth Business Day following the Termination Time, an amount equal to the full
Subscription Amount and their pro rata (among Canadian and non-U.S. holders on the one hand and
among U.S. holders on the other), entitlement to the interest actually earned on such amount in
accordance with the terms of the Subscription Receipt Agreement.

     The Term Sheet, a copy of which is attached hereto as Schedule “B”, summarizes the terms of
the Subscription Receipts. The description of the Subscription Receipts contained in the Term
Sheet and this Subscription Agreement is a summary only and is qualified in its entirety by the
Subscription Receipt Agreement. The provisions of the Subscription Receipt Agreement and the
attributes and characteristics of the Subscription Receipts provided for therein shall be
substantially as described herein, with such changes thereto as the Agents, the Subscription
Receipt Agent, the U.S. Escrow Agent and the Company may agree, and otherwise the Subscription
Receipt Agreement shall be in such form and contain such terms and provisions as are reasonably
satisfactory to the Company, the Subscription Receipt Agent, the U.S. Escrow Agent and the Agents.

2.4 Acceptance and Rejection of Subscription by the Company

     The Subscriber acknowledges and agrees that the Company and the Agents reserve the right, in
their absolute discretion, to reject this subscription for Subscription Receipts, in whole or in
part, at any time prior to the Closing Time. If this subscription is rejected in whole, any cheques
or other forms of payment delivered to the Agents representing the Subscription Amount will be
promptly returned to the Subscriber without interest or deduction. If this subscription is accepted
only in part, a cheque representing any refund of the Subscription Amount for that portion of the
subscription for Subscription Receipts which is not accepted, will be promptly delivered to the
Subscriber without interest or deduction.

ARTICLE 3 — CLOSING

3.1 Closing

     Delivery and sale of the Subscription Receipts and payment of the Subscription Amount will be
completed (the “Closing”) at the offices of the Company’s Canadian counsel, Osler, Hoskin &
Harcourt LLP at 8:30 a.m. (Toronto time) (the “Closing Time”) on or about February 23, 2011 or
such other date or time as the Company and the Agents may decide (the “Closing Date”).

     If, at the Closing Time, the terms and conditions contained in this Subscription Agreement and
the Agency Agreement have been complied with to the satisfaction of the Agents or waived by them,
the Agents shall deliver to the Company the completed Subscription Agreement and shall deliver to
the Subscription Receipt Agent and the U.S. Escrow Agent or such other subscription receipt or
escrow agent as may be appointed from time to time pursuant to the terms of the Subscription
Receipt Agreement the payment of the aggregate Subscription Price for (a) in the case of the
Subscription Receipt Agent, the Subscription Receipts subscribed for by Canadian and non-U.S.
Subscribers and (b) in the case of the U.S. Escrow Agent, the Subscription Receipts subscribed for
by U.S. Subscribers, in each case against delivery by the Company of a certificate(s) representing
the Subscription Receipts registered and delivered as directed by the Agents and such other
documentation as may be required pursuant to the Subscription Agreement, the Subscription Receipt
Agreement and the Agency Agreement.

     If, prior to the Closing Time, the terms and conditions contained in this Subscription
Agreement and the Agency Agreement have not been complied with to the satisfaction of the Agents or
waived by them or if the Agency Agreement is terminated in accordance with its terms, the Agents,
the Company and the Subscriber will have no further obligations under this Subscription Agreement.

A-4 

 

3.2 Conditions of Closing

     The Subscriber understands that the Company will use the proceeds of the Offering for general
corporate purposes and to extinguish up to approximately US$43 million of debt indirectly assumed
by the Company in connection with the merger of (the “Acquisition”) Choice Environmental Services,
Inc. with and into a subsidiary of the Company pursuant to an agreement and plan of merger (the
“Acquisition Agreement”) to be entered into prior to the Closing of the Offering. The closing of
the Acquisition must be completed prior to the Termination Time.

     The Subscriber acknowledges and agrees that the obligations of the Company hereunder are
conditional on the accuracy of the representations and warranties of the Subscriber contained in
this Subscription Agreement as of the date of this Subscription Agreement, and as of the Closing
Time as if made at and as of the Closing Time, and the fulfillment of the following additional
conditions as soon as possible and in any event not later than 24 hours prior to the Closing Time:

	 	(a)	 	unless other arrangements acceptable to the Company have been made, payment by
the Subscriber of the Subscription Amount, payable in Canadian Funds:

	 	(i)	 	IF THE SUBSCRIBER IS NOT RESIDENT IN THE UNITED
STATES, by way of a certified cheque or bank draft to “Clarus Securities Inc.”
unless other acceptable payment arrangements have been made; or
	 
	 	(ii)	 	IF THE SUBSCRIBER IS RESIDENT IN THE UNITED STATES, as
instructed by Broadband Capital Management LLC;

	 	(b)	 	the Subscriber having properly completed, signed and delivered this
Subscription Agreement to:

	 	 	 
	For Canadian Subscribers and Other	 	 
	Subscribers not Resident in the U.S.:	 	For US Subscribers:
	 
	Clarus Securities Inc.

	 	Broadband Capital Management LLC
	Exchange Tower, 130 King Street West,

	 	712 5th Avenue
	Suite 3640

	 	22nd Floor
	Toronto, Ontario M5X 1A9

	 	New York, New York 10019
	 
	 	 
	Attention: April Cuadra

	 	Attention: Ericka Duckett
	 
	 	 
	Fax: (416) 343-2799

	 	Fax (212) 702-9830

	 	(c)	 	the Subscriber having properly completed, signed and delivered Schedule “C”,
Schedule “D”, Schedule “E” and, to the extent practicable (and in any event by no later
than 5 Business Days after the Closing Date), Annex B to Schedule “F”, as applicable:

	 	(i)	 	ALL SUBSCRIBERS
	 
	 	 	 	a duly completed and executed Certificate of Subscribers in the form
attached to the Subscription Agreement as Schedule “C” and, to the extent
practicable (and in any event by no later than 5 Business Days after the
Closing Date), Annex B to Schedule “F”;
	 
	 	(ii)	 	ALL CANADIAN SUBSCRIBERS
	 
	 	 	 	a duly completed and executed Canadian Accredited Investor Certificate in
the form attached to this Subscription Agreement as Schedule “D” (in
addition to Schedule “C” and, to the extent practicable (and in any event by
no later than 5 Business Days after the Closing Date), Annex B to Schedule
“F”); and

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	 	(iii)	 	ALL SUBSCRIBERS WHO ARE NOT RESIDENT IN CANADA OR THE
UNITED STATES
	 
	 	 	 	a duly completed and executed Certificate of Non-Canadian Subscribers in the
form attached to this Subscription Agreement as Schedule “E” (in addition to
Schedule “C” and, to the extent practicable (and in any event by no later
than 5 Business Days after the Closing Date), Annex B to Schedule “F”).

     The Company acknowledges and agrees that the obligations of the Subscriber hereunder are
conditional on the accuracy of the representations and warranties of the Company contained in this
Subscription Agreement and in the Agency Agreement as of the date of this Subscription Agreement,
and as of the Closing Time as if made at and as of the Closing Time, and the fulfilment of the
following conditions, amongst others, as soon as possible and in any event not later than the
Closing Time:

	 	(a)	 	the Company having delivered a certificate to the Agents confirming that the
Company (or one of its subsidiaries) has entered into the Acquisition Agreement, in
form and substance generally consistent with the description of such given to
Subscribers;
	 
	 	(b)	 	all covenants, agreements and conditions contained in this Subscription
Agreement and in the Agency Agreement to be performed by the Company on or prior to the
Closing shall have been performed or complied with in all material respects, including
without limitation, obtaining conditional approval from the TSX and Nasdaq for the
Offering, being effected on a private placement basis, and to list the Common Shares
and Penalty Shares; and
	 
	 	(c)	 	the Company shall have delivered to the Agents’ counsel the following items:

	 	(i)	 	a copy of the certificate(s) representing the Subscription
Receipts purchased by the Subscriber registered in the name of the Subscriber
or its nominee;
	 
	 	(ii)	 	a copy of this Subscription Agreement duly executed by the Company; and
	 
	 	(iii)	 	such other documents relating to the transactions contemplated
by this Subscription Agreement and the Agency Agreement as the Agents or their
counsel may reasonably request.

ARTICLE 4 — REPRESENTATIONS, WARRANTIES AND COVENANTS

OF THE COMPANY

4.1 Representations, Warranties and Covenants of the Company

     By execution of this Subscription Agreement, the Company hereby covenants and agrees with the
Subscriber that the Subscriber shall be entitled to rely on the representations and warranties made
by the Company to the Agents as set forth in the Agency Agreement (to the extent that they have not
been varied, amended, altered or waived, in whole or in part, by the Agents). Such representations
and warranties shall form an integral part of this Subscription Agreement and shall survive the
Closing of the purchase and sale of the Subscription Receipts and the issuance of the underlying
Common Shares and shall continue in full force and effect for the benefit of the Subscriber in
accordance with the terms of the Agency Agreement.

     The Company, hereby represents and warrants to, and covenants with, the Subscriber and Agents
as follows and acknowledges that the Subscriber and the Agents are relying on such representations,
warranties and covenants in connection with the transactions contemplated herein and such
representations, warranties and covenants shall continue in full force and effect for the benefit
of the Subscriber and the Agents in accordance with the terms of this Subscription Agreement:

	 	(a)	 	The Company acknowledges and agrees to the terms and conditions set out in
Schedule “F”.

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	 	(b)	 	No form of general solicitation or general advertising (including
advertisements, articles, notices or other communications published in any newspaper,
magazine or similar media or broadcast over radio, television or electronic display
(including the internet) or any seminar or meeting whose attendees had been invited by
general solicitation or general advertising) was used by the Company or, to the best of
its knowledge, any other person acting on behalf of the Company (other than the Agents
and persons acting on their behalf, as to which no representation is made), in respect
of or in connection with the offer and sale of the Subscription Receipts in the United
States or elsewhere or to citizens or residents of the United States or elsewhere.
	 
	 	(c)	 	Neither the Company nor any person authorized to act on its behalf (other than
the Agents and persons acting on their behalf, as to which no representation is made)
has sold or offered for sale any Subscription Receipts, or solicited any offers to buy
any Subscription Receipts thereby so as to cause the issuance or sale of any of the
Subscription Receipts to be in violation of Section 5 of the U.S. Securities Act, or
Canadian or other securities laws.
	 
	 	(d)	 	The Company is not an open-end investment company, closed-end investment
company, unit investment or face-amount certificate company that is or is required to
be registered under Section 8 of the United States Investment Company Act of 1940, as
amended.
	 
	 	(e)	 	The Company has not, for a period of six months prior to the date hereof sold,
offered for sale or solicited any offer to buy any of its securities in a manner that
would be integrated with the offer and sale of the Subscription Receipts and would
cause the exemption from registration set forth in Rule 506 of Regulation D under the
U.S. Securities Act to become unavailable with respect to the offer and sale of the
Subscription Receipts.
	 
	 	(f)	 	The Company will use commercially reasonable efforts to ensure that there is
available “adequate current public information” with respect to the Company within the
meaning of Rule 144(c) under the U.S. Securities Act after the Closing Date and at all
times thereafter when the registration statement referred to in Section 4.1(a) is not
effective and up to date.
	 
	 	(g)	 	At any time that the Company is neither subject to Section 13 or 15(d) of the
Securities Exchange Act of 1934, as amended, the Company shall at the request of the
Subscriber or any prospective purchaser designated by the Subscriber, promptly provide
to such person with reasonable promptness, the information specified in Rule
144A(d)(4)(i) under the U.S. Securities Act.
	 
	 	(h)	 	The Company will have, in all material respects, performed and complied with
all covenants and agreements contained in this Subscription Agreement to be performed
or complied with, or caused to be performed or complied with, by the Company at or
prior to the Closing.
	 
	 	(i)	 	All necessary corporate action will have been taken by the Company to authorize
the execution and delivery of this Subscription Agreement, and to consummate the
transactions contemplated by this Subscription Agreement.

ARTICLE 5 — REPRESENTATIONS, WARRANTIES, COVENANTS AND

ACKNOWLEDGMENTS OF THE SUBSCRIBER

5.1 Representations, Warranties and Covenants of the Subscriber

     By execution of this Subscription Agreement, the Subscriber, on its own behalf and, if
applicable, on behalf of others for whom it is acting hereunder, hereby represents and warrants to,
and covenants with, the Company and Agents as follows and acknowledges that the Company and the
Agents are relying on such representations, warranties and covenants in connection with the
transactions contemplated herein:

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	 	(a)	 	The matters set forth by the Subscriber on pages 2 and 3 of this Subscription
Agreement are true and correct as of the date of execution of this Subscription
Agreement and will be true and correct as of the Closing Time.
	 
	 	(b)	 	The Subscriber and each beneficial purchaser for whom it is acting is a
resident in the jurisdiction set out on page 2 of this Subscription Agreement. Such
address was not created and is not used solely for the purpose of acquiring the
Subscription Receipts and the Subscriber and any beneficial purchaser was solicited to
purchase and executed this Subscription Agreement in such jurisdiction.
	 
	 	(c)	 	The Subscriber has properly completed, executed and delivered to the Agents
within the applicable time periods the certificate(s) set forth in Schedule “C” and
Annex B to Schedule “F” and Schedule “D”, and Schedule “E”, as applicable, to this
Subscription Agreement and the information contained therein is true and correct.
	 
	 	(d)	 	The representations, warranties and covenants contained in this Schedule “A”
and in the other applicable Schedules to this Subscription Agreement are true and
correct as of the date of execution of this Subscription Agreement and will be true and
correct as of the Closing Time.
	 
	 	(e)	 	If the Subscriber, or any beneficial purchaser for whom it is acting, is not a
person resident in Canada or the United States, the subscription for the Subscription
Receipts by and the issuance and delivery of the Subscription Receipts to the
Subscriber, or such beneficial purchaser, does not contravene any of the applicable
securities legislation in the jurisdiction in which the Subscriber or such beneficial
purchaser resides and does not give rise to any obligation of the Company to prepare
and file a prospectus or similar document or to register the Securities or to be
registered with or to file any report or notice with any governmental or regulatory
authority of any kind whatsoever.
	 
	 	(f)	 	The execution and delivery of this Subscription Agreement, the performance and
compliance with the terms hereof, the subscription for Subscription Receipts and the
completion of the transactions described herein by the Subscriber will not result in
any material breach of, or be in conflict with or constitute a material default under,
or create a state of facts which, after notice or lapse of time, or both, would
constitute a material default under any term or provision of the constating documents,
by-laws or resolutions of the Subscriber, the Securities Laws or any other laws
applicable to the Subscriber, any agreement to which the Subscriber is a party, or any
judgment, decree, order, statute, rule or regulation applicable to the Subscriber.
	 
	 	(g)	 	The funds representing the Subscription Amount which will be advanced by the
Subscriber to the Company hereunder will not represent proceeds of crime for the
purposes of the Proceeds of Crime (Money Laundering) Act (Canada) (the “PCMLA”) and the
Subscriber acknowledges that the Company may in the future be required by law to
disclose the Subscriber’s name and other information relating to this Subscription
Agreement and the Subscriber’s subscription hereunder, on a confidential basis,
pursuant to the PCMLA. To the best of its knowledge: none of the funds comprising the
Subscription Amount to be provided by the Subscriber (i) have been or will be derived
from or related to any activity that is deemed criminal under the law of Canada, the
United States, or any other jurisdiction, or (ii) are being tendered on behalf of a
person or entity who has not been identified to the Subscriber, and it shall promptly
notify the Company if the Subscriber discovers that any of such representations ceases
to be true and provide the Company with appropriate information in connection
therewith.
	 
	 	(h)	 	The Subscriber is subscribing for the Subscription Receipts for his, her or its
own account, as principal (within the meaning of applicable Securities Laws) and not
with a view to the resale or distribution of all or any of the Securities or if it is
not subscribing as principal, it acknowledges that the Company may be required by law
to disclose (and if required by law the Subscriber agrees to disclose) to certain
regulatory authorities the identity of each beneficial purchaser of the Subscription
Receipts for whom it is acting.

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	 	(i)	 	In the case of a subscription for the Subscription Receipts by the Subscriber
acting as trustee or agent (including, for greater certainty, a portfolio manager or
comparable adviser) for a principal, the Subscriber is duly authorized to execute and
deliver this Subscription Agreement and all other necessary documentation in connection
with such subscription on behalf of each such beneficial purchaser, each of whom is
subscribing as principal for its own account, not for the benefit of any other person
and not with a view to the resale or distribution of all or any of the Securities, and
this Subscription Agreement has been duly authorized, executed and delivered by or on
behalf of and constitutes a legal, valid, enforceable and binding agreement of, such
principal, and the Subscriber acknowledges that the Company may be required by law to
disclose (and if required by law the Subscriber agrees to disclose) the identity of
each beneficial purchaser for whom the Subscriber is acting.
	 
	 	(j)	 	The Subscriber is not an Insider or “affiliate” of the Company (as such term is
defined under Securities Laws).
	 
	 	(k)	 	In the case of a subscription for the Subscription Receipts by the Subscriber
acting as principal, this Subscription Agreement has been duly authorized, executed and
delivered by, and constitutes a legal, valid and binding agreement of, the Subscriber.
This Subscription Agreement is enforceable in accordance with its terms against the
Subscriber and any beneficial purchasers on whose behalf the Subscriber is acting.
	 
	 	(l)	 	If the Subscriber is:

	 	(i)	 	a corporation, the Subscriber is duly incorporated and is
validly subsisting under the laws of its jurisdiction of incorporation and has
all requisite legal and corporate power and authority to execute and deliver
this Subscription Agreement, to subscribe for the Subscription Receipts as
contemplated herein and to carry out and perform its covenants and obligations
hereunder;
	 
	 	(ii)	 	a partnership, syndicate or other form of unincorporated
organization, the Subscriber has the necessary legal capacity and authority to
execute and deliver this Subscription Agreement and to observe and perform its
covenants and obligations hereunder and has obtained all necessary approvals in
respect thereof; or
	 
	 	(iii)	 	an individual, the Subscriber is of the full age of majority
and is legally competent to execute and deliver this Subscription Agreement and
to observe and perform his or her covenants and obligations hereunder.

	 	(m)	 	Other than the Agents, to the best of the Subscriber’s knowledge, there is no
person acting or purporting to act in connection with the transactions contemplated
herein who is entitled to any brokerage or finder’s fee. If any person establishes a
claim that any fee or other compensation is payable in connection with this
subscription for the Subscription Receipts, the Subscriber covenants to indemnify and
hold harmless the Company and the Agents with respect thereto and with respect to all
costs reasonably incurred in the defence thereof.
	 
	 	(n)	 	The Subscriber is not, with respect to the Company or any of its affiliates, a
Control Person and the Subscriber will not become a Control Person by purchasing the
number of Subscription Receipts subscribed for under this Subscription Agreement and
does not intend to act jointly or in concert with any other person to form a control
group in respect of the Company.
	 
	 	(o)	 	If required by applicable Securities Laws or the Company, the Subscriber will
execute, deliver and file or assist the Company in filing such reports, undertakings
and other documents with respect to the issue of the Subscription Receipts as may be
required by any securities commission, stock exchange or other regulatory authority.

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	 	(p)	 	The Subscriber, and each beneficial purchaser for whom it is acting hereunder,
have been advised to consult their own legal advisors with respect to (i) the
suitability of the Subscription Receipts (and the underlying Common Shares) as an
investment for the Subscriber and has not relied upon any statements made by or
purporting to have been made on behalf of the Company or the Agents in deciding to
subscribe for Subscription Receipts hereunder and (ii) trading in any of the Securities
with respect to the resale restrictions imposed by the Securities Laws of the
jurisdiction in which the Subscriber resides, other applicable Securities Laws, and the
policies of the TSX and Nasdaq. Subject to the registration rights described in
Schedule “F”, the Subscriber acknowledges that no representation has been made
respecting the applicable hold periods imposed by the Securities Laws or other resale
restrictions applicable to such Securities which restrict the ability of the Subscriber
(or others for whom it is contracting hereunder) to resell such Securities, that the
Subscriber (or others for whom it is contracting hereunder) is solely responsible to
find out what these restrictions are and the Subscriber is solely responsible (and the
Company and the Agents are not in any way responsible) for compliance with applicable
resale restrictions and the Subscriber is aware that it (or beneficial purchasers for
whom it is contracting hereunder) may not be able to resell such Securities except in
accordance with limited exemptions under the Securities Laws.
	 
	 	(q)	 	The Subscriber has not received nor been provided with, has not requested and
does not have any need to receive a prospectus or offering memorandum, within the
meaning of the Securities Laws, or any sales or advertising literature in connection
with the Offering, and the Subscriber’s decision to subscribe for the Subscription
Receipts was based upon the Company’s publicly available documents included in the
Edgar database administered by the SEC and the SEDAR database administered under the
direction of the Canadian Securities Administrators.
	 
	 	(r)	 	Other than information provided to Subscribers in meetings or calls organized
with representatives of the Company (summaries of which are to be filed by the Company
on or before Closing, the Subscriber (and, if applicable, others for whom it is
contracting hereunder), in entering into this Agreement, has relied solely upon
publicly available information relating to the Company (including that information in
the documents listed in Schedule “G”), this Subscription Agreement and the Agency
Agreement and not upon any verbal or written representation as to any fact or otherwise
made by or on behalf of the Company, the Agents or any employee, agent or affiliate
thereof or any other person associated therewith. The Agents assume no responsibility
or liability of any nature whatsoever for the accuracy or adequacy of the publicly
available information upon which the Subscriber’s investment decision has been made or
as to whether all information concerning the Company required to be disclosed by the
Company has been disclosed.
	 
	 	(s)	 	The Subscriber is not purchasing the Subscription Receipts with knowledge of
material information concerning the Company which has not been generally or publicly
disclosed, including, without limitation, any information that would constitute a
“material change” or a “material fact” (as those terms are defined under Securities
Laws).
	 
	 	(t)	 	No person has made any written or oral representations:

	 	(i)	 	that any person will resell or repurchase any of the
Securities;
	 
	 	(ii)	 	other than pursuant to the terms of the Subscription Receipt
Agreement, that any person will refund the Subscription Amount; or
	 
	 	(iii)	 	as to the future price or value of any of the Securities.

	 	(u)	 	The subscription for the Subscription Receipts has not been made through or as
a result of, and the offer and sale of the Subscription Receipts is not being
accompanied by any advertisement, including without limitation in printed public media,
radio, television or telecommunications, including electronic display, or as part of a
general solicitation.

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	 	(v)	 	The Subscriber confirms that the Subscriber:

	 	(i)	 	has such knowledge in financial and business affairs as to be
capable of evaluating the merits and risks of its investment in the
Subscription Receipts (and the underlying Common Shares);
	 
	 	(ii)	 	is capable of assessing the proposed investment in the
Subscription Receipts (and the underlying Common Shares) as a result of the
Subscriber’s own experience or as a result of advice received from a person
registered under applicable securities legislation;
	 
	 	(iii)	 	is aware of the characteristics of the Subscription Receipts
(and the underlying Common Shares) and the risks relating to an investment
therein, including, without limitation, those risks set out in the Company’s
publicly available information including that set out in Schedule “G” hereto;
	 
	 	(iv)	 	is able to bear the economic risk of loss of its investment in
the Subscription Receipts (and the underlying Common Shares); and
	 
	 	(v)	 	is an accredited investor as such term is defined in Regulation
D under the U.S. Securities Act.

	 	(w)	 	The Subscriber understands that it is purchasing the Subscription Receipts
directly from the Company.

5.2 Acknowledgments of the Subscriber

     The Subscriber, on its own behalf and, if applicable, on behalf of others for whom it is
acting hereunder, acknowledges and agrees as follows:

	 	(a)	 	The Subscriber has received and reviewed a copy of the Term Sheet setting out
the principal terms of the Offering.
	 
	 	(b)	 	The Subscriber acknowledges that the aggregate gross proceeds of the Offering
will be up to approximately $58,246,875 and will result in the issuance of 12,262,500
Subscription Receipts.
	 
	 	(c)	 	No securities commission, agency, governmental authority, regulatory body,
stock exchange or similar regulatory authority has reviewed, passed upon, made any
finding or determination, or recommended or endorsed on the merits of the Subscription
Receipts.
	 
	 	(d)	 	Subject to the registration rights described in Schedule “F”, the Securities
shall be subject to statutory resale restrictions under the Securities Laws of the
province, territory or jurisdiction in which the Subscriber resides and the U.S.
Securities Act and under other applicable Securities Laws, and the Subscriber covenants
that it will not resell any of the Securities except in compliance with such laws and
the Subscriber acknowledges that it is solely responsible (and the Company and the
Agents are not in any way responsible) to understand what those restrictions are and to
comply with them before selling any of the Securities.
	 
	 	(e)	 	The Subscriber’s ability to transfer any of the Securities is limited by, among
other things, applicable Securities Laws and the Securities will not be
transferable without the consent of the Company and Clarus Securities Inc., on behalf
of the Agents, on or before the date that is four months after the Closing.
	 
	 	(f)	 	The certificates representing the Subscription Receipts (and, if issued prior
to the date that is four months after the Closing, any certificates representing the
Common Shares and Penalty Shares)
will bear, as of the Closing Date, a legend substantially in the following form and
with the necessary information inserted:

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	 	 	 	UNLESS PERMITTED UNDER SECURITIES LEGISLATION AND CONSENTED TO BY SWISHER HYGIENE
INC. AND CLARUS SECURITIES INC., THE HOLDER OF THIS SECURITY MUST NOT TRADE THE
SECURITY BEFORE <INSERT DATE THAT IS FOUR (4) MONTHS AND ONE (1) DAY AFTER THE
CLOSING DATE>.
	 
	 	(g)	 	In addition, the certificates representing the Common Shares and Penalty
Shares, if issued prior to the date that is four months after the Closing, will also
bear a legend substantially in the following form:
	 
	 	 	 	“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE LISTED ON THE TORONTO STOCK
EXCHANGE (“TSX”); HOWEVER, THE SAID SECURITIES CANNOT BE TRADED THROUGH THE
FACILITIES OF THE TSX SINCE THEY ARE NOT FREELY TRANSFERABLE, AND CONSEQUENTLY ANY
CERTIFICATE REPRESENTING SUCH SECURITIES IS NOT “GOOD DELIVERY” IN SETTLEMENT OF
TRANSACTIONS ON THE TSX.”
	 
	 	(h)	 	The Subscriber, and each beneficial purchaser for whom it is acting hereunder,
shall execute, deliver, file and otherwise assist the Company and Agents with filing
all documentation required by the applicable Securities Laws to permit the subscription
for the Subscription Receipts and the issuance of the Securities.
	 
	 	(i)	 	No prospectus or offering memorandum, within the meaning of the Securities
Laws, or other similar disclosure document has been filed by the Company with a
securities commission, securities regulatory authority or other governmental or
regulatory authority in the United States, in any province in Canada or any other
jurisdiction in connection with the issuance of the Subscription Receipts.
	 
	 	(j)	 	The Company and Agents are relying on the representations, warranties and
covenants contained herein and in the applicable Schedules attached hereto to determine
the Subscriber’s eligibility to subscribe for the Subscription Receipts under
applicable Securities Laws and the Subscriber agrees to indemnify each of the Company
and the Agents, and each of its directors, officers, agents, advisors and shareholders
against all losses, claims, costs, expenses, damages or liabilities which any of them
may suffer or incur as a result of or arising from reliance thereon. The Subscriber
undertakes to immediately notify the Company of any change in any statement or other
information relating to the Subscriber set forth in such applicable Schedules which
takes place prior to the Closing Time.
	 
	 	(k)	 	The Company is relying on an exemption from the requirement to provide the
Subscriber with a prospectus under the Securities Laws of Canada and as a consequence
of acquiring the Subscription Receipts pursuant to such exemption:

	 	(i)	 	certain protections, rights and remedies provided by applicable
Securities Laws, including statutory rights of rescission and certain statutory
remedies against an issuer, Agents, auditors, directors and officers that are
available to investors who acquire securities offered by a prospectus, will not
be available to the Subscriber and each beneficial person for whom it is
contracting hereunder, or, if applicable, others for whom you are contracting
hereunder;
	 
	 	(ii)	 	the common law may not provide investors with an adequate
remedy in the event that they suffer investment losses in connection with
securities acquired in a private placement;

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	 	(iii)	 	the Subscriber and each beneficial person for whom it is
contracting hereunder, may not receive information that would otherwise be
required to be given under applicable Securities Laws; and
	 
	 	(iv)	 	the Company is relieved from certain obligations that would
otherwise apply under applicable Securities Laws.

	 	(l)	 	The Securities are “restricted securities” as defined in Rule 144(a)(3) under
the U.S. Securities Act and have not been registered under the U.S. Securities Act or
any state securities laws and may not be reoffered or resold in the United States or to
U.S. Persons unless registered under the U.S. Securities Act and applicable state
securities laws, as contemplated in Schedule “F”, or an exemption from such
registration requirements is available. Until resales of the Securities are registered
under the U.S. Securities Act, the Securities may not practically be able to be offered
and sold on the TSX pursuant to Rule 904 under the U.S. Securities Act since the
Securities will remain “restricted securities” pursuant to Rule 905 of Regulation S
under the U.S. Securities Act.
	 
	 	(m)	 	The Subscriber agrees that if the Subscriber decides to offer, sell, pledge or
otherwise transfer any of the Securities, the Subscriber will not offer, sell, pledge
or otherwise transfer any of the Securities, directly or indirectly, unless;

	 	(i)	 	the sale is to the Company; or
	 
	 	(ii)	 	made pursuant to an effective registration statement under the
U.S. Securities Act; or
	 
	 	(iii)	 	the sale is made outside the United States in compliance with
the requirements of Rule 904 of Regulation S under the U.S. Securities Act and
in compliance with applicable local laws and regulations; or
	 
	 	(iv)	 	the sale is made in compliance with an exemption from
registration under the U.S. Securities Act provided by Rule 144 thereunder, if
available, and in accordance with any applicable state securities law; or
	 
	 	(v)	 	the Securities are sold in a transaction that does not require
registration under the U.S. Securities Act or any applicable state securities
laws.

	 	(n)	 	There is no government insurance or other insurance covering the Securities.
	 
	 	(o)	 	AN INVESTMENT IN THE SUBSCRIPTION RECEIPTS AND UNDERLYING SECURITIES IS NOT
WITHOUT RISK, INCLUDING, WITHOUT LIMITATION, THOSE RISKS SET FORTH IN THE COMPANY’S
FILINGS UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, WHICH FILINGS AS AT THE
DATE HEREOF, ARE LISTED IN SCHEDULE “G” HERETO AND THE SUBSCRIBER (AND ANY BENEFICIAL
PURCHASER) MAY LOSE HIS, HER OR ITS ENTIRE INVESTMENT.
	 
	 	(p)	 	The Company may complete additional financings in the future in order to
develop the business of the Company and fund its ongoing development, and such future
financings may have a dilutive effect on current securityholders of the Company,
including the Subscriber, but there is no assurance that such financing will be
available, on reasonable terms or at all, and if not available, the Company may be
unable to fund its ongoing development.
	 
	 	(q)	 	The Subscriber, and each beneficial person for whom it is contracting
hereunder, is responsible for obtaining such legal, investment, tax and other
professional advice as it considers appropriate in connection with the execution,
delivery and performance of this Subscription Agreement and the
transactions contemplated under this Subscription Agreement (including the resale
and transfer restrictions referred to herein), and, without limiting the generality
of the foregoing:

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	 	(i)	 	the Company’s counsel are acting solely as counsel to the
Company and not as counsel to the Subscriber;
	 
	 	(ii)	 	the Agents’ counsel are acting solely as counsel to the Agents
and not as counsel to the Subscriber; and
	 
	 	(iii)	 	the Agents are acting solely as financial advisors to, and
Agents of, the Company and not as financial advisors to the Subscriber, or as
Agents of, the Subscriber, except insofar as is necessary at the Closing to
deliver payment for the Subscription Receipts to the Company on behalf of the
Subscriber and to accept and deliver the Subscription Receipts to the
Subscriber after the Closing.

	 	(r)	 	The Subscription Receipts have not been registered under the U.S. Securities
Act or any state securities laws, and the sale contemplated hereby is being made in
reliance on the a private placement exemption to Accredited Investors (as defined in
Rule 506 under the U.S. Securities Act).
	 
	 	(s)	 	The Subscriber understands that, until such time as is no longer required under
applicable requirements of the U.S. Securities Act or applicable state securities laws,
all certificates representing the Securities, as well as all certificates issued in
exchange for or in substitution of the foregoing securities, will bear a legend to the
following effect:
	 
	 	 	 	THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE
BENEFIT OF THE COMPANY THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY: (A) TO THE COMPANY, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT, (C) OUTSIDE THE UNITED STATES
IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT IF
AVAILABLE, (D) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES
ACT PROVIDED BY RULE 144, IF AVAILABLE, AND IN COMPLIANCE WITH ANY STATE SECURITIES
LAWS, OR (E) WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY, PURSUANT TO ANOTHER
EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS; PROVIDED THAT, IN CONNECTION WITH A TRANSFER PURSUANT TO (C), (D)
OR (E) ABOVE, AN OPINION OF COUNSEL, OF RECOGNIZED STANDING REASONABLY SATISFACTORY
TO THE COMPANY HAS BEEN PROVIDED TO THE COMPANY TO SUCH EFFECT.
	 
	 	 	 	if the Securities are being sold pursuant sections (C) through (E) of the foregoing
legend, the legend may be removed by delivery to the Company’s registrar and
transfer agent and the Company of an opinion of counsel, of recognized standing in
form and substance satisfactory to the Company, that such legend is no longer
required under applicable requirements of the U.S. Securities Act or state
securities laws.
	 
	 	(t)	 	The Subscriber understands and agrees that there may be material tax
consequences to the Subscriber of an acquisition or disposition of the Securities, and
the Subscriber acknowledges that it is responsible for determining the tax consequences
of its investments. The Company gives no opinion and makes no representation with
respect to the tax consequences to the Subscriber under United States, state, local or
Canadian or other foreign tax law of the Subscriber’s acquisition or disposition of
such securities.

A-14 

 

	 	(u)	 	Subject to the terms and conditions of the registration rights set forth in
Schedule “F”, it acknowledges that such registration rights may be amended or waived by
holders holding a majority of the Registrable Securities (as defined in Schedule “F”)
pursuant to Section 7(d) thereof, and that the Company’s obligations under Schedule “F”
are conditioned upon the Subscriber cooperating with the Company as reasonably
requested by the Company in connection with the preparation and filing of any
Registration Statement hereunder, including but not limited to providing such
information in a timely manner regarding itself, the Subscription Receipts and other
securities of the Company held by it and the intended method of disposition of the
Subscription Receipts as shall be reasonably required to effect and maintain the
effectiveness of the registration of such Subscription Receipts.

5.3 Reliance on Representations, Warranties, Covenants and Acknowledgements

     The Subscriber acknowledges and agrees that the representations, warranties, covenants and
acknowledgements made by the Subscriber in this Subscription Agreement are made with the intention
that they may be relied upon by the Company and the Agents in determining the Subscriber’s
eligibility (and, if applicable, the eligibility of others for whom the Subscriber is contracting
hereunder) to purchase the Subscription Receipts under Securities Laws. The Subscriber undertakes
to immediately notify the Company of any change in any statement or other information relating to
the Subscriber set forth in this Subscription Agreement, or in any document furnished by the
Subscriber to the Company or the Agents in connection with this Subscription Agreement, which takes
place at or prior to the Closing Time.

     The Subscriber further agrees that by accepting the Subscription Receipts, the Subscriber
shall be representing and warranting that such representations, warranties, acknowledgements and
covenants are true as at the Closing Time with the same force and effect as if they had been made
by the Subscriber at the Closing Time and that they shall survive the purchase by the Subscriber of
the Subscription Receipts and shall continue in full force and effect notwithstanding any
subsequent disposition by the Subscriber of any of Subscription Receipts.

ARTICLE 6 — SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS

6.1 Survival of Representations, Warranties and Covenants of the Company

     The representations, warranties and covenants of the Company contained in this Subscription
Agreement shall survive the Closing and, notwithstanding such Closing or any investigation made by
or on behalf of the Subscriber with respect thereto, shall continue in full force and effect for
the benefit of the Subscriber and the Agents.

6.2 Survival of Representations, Warranties and Covenants of the Subscriber

     The representations, warranties and covenants of the Subscriber contained in this Subscription
Agreement shall survive the Closing and, notwithstanding such Closing or any investigation made by
or on behalf of the Company or the Agents with respect thereto, shall continue in full force and
effect for the benefit of the Company and the Agents.

ARTICLE 7 — INDEMNITY

7.1 Indemnity

     The Subscriber shall indemnify and hold harmless each of the Company and the Agents and each
of their respective directors, officers, employees, agents, advisers and shareholders
(collectively, the “Indemnified Parties” and each an “Indemnified Party”) from and against any and
all actual or threatened claims, actions, suits, investigations and proceedings (collectively, the
“Proceedings”) and any and all losses, liabilities, claims, damages, fees, costs and expenses, all
amounts paid to settle any Proceeding or to satisfy any judgment or award, and all legal fees and
disbursements incurred by an Indemnified Party (including legal fees and disbursements incurred in
enforcing this indemnity), caused or arising, directly or indirectly, by reason of or in
consequence of, any
representation or warranty of the Subscriber contained in this Subscription Agreement or in
any document furnished by the Subscriber to the Company or the Agents in connection with this
Subscription Agreement being untrue in any material respect or any breach or failure by the
Subscriber to comply with any covenant or agreement made by the Subscriber in this Subscription
Agreement or in any document furnished by the Subscriber to the Company or the Agents in connection
with this Subscription Agreement.

A-15 

 

ARTICLE 8 — AUTHORIZATION OF THE AGENTS

8.1 Authorization of the Agents

     The Subscriber irrevocably authorizes the Agents in their sole and absolute discretion, to act
as the Subscriber’s representative at the Closing, and hereby appoints the Agents with full power
of substitution, as its true and lawful attorney with full power and authority in the Subscriber’s
place and stead:

	 	(a)	 	to receive certificates representing the Subscription Receipts, to execute in
the Subscriber’s name and on its behalf all closing receipts and required documents, to
complete and correct any errors or omissions in any form or document provided by the
Subscriber in connection with the subscription for the Subscription Receipts and to
exercise any rights of termination contained in the Agency Agreement;
	 
	 	(b)	 	to extend such time periods and to waive, in whole or in part, any
representations, warranties, covenants or conditions for the Subscriber’s benefit
contained in this Subscription Agreement and the Agency Agreement or any ancillary or
related documents;
	 
	 	(c)	 	to terminate this Subscription Agreement if any condition precedent is not
satisfied, in such manner and on such terms and conditions as the Agents in their sole
discretion may determine; and
	 
	 	(d)	 	without limiting the generality of the foregoing, to negotiate, settle,
execute, deliver and amend the Agency Agreement and the Subscription Receipt Agreement.

ARTICLE 9 — COMMISSION

9.1 Fee to the Agents

     The Subscriber understands that in connection with the issue and sale of the Subscription
Receipts pursuant to the Offering, the Agents will receive from the Company, a cash fee equal to
5.0% of the gross proceeds of the Offering of Subscription Receipts. Such fee will be payable as
to 50% on the Closing Date and the remainder on the closing date of the Acquisition. No other fee
or commission is payable by the Company in connection with the completion of the Offering.
However, the Company will pay certain fees and expenses of the Agents in connection with the
Offering as set out in the Agency Agreement.

ARTICLE 10 — COLLECTION OF PERSONAL INFORMATION

10.1 Collection of Personal Information

     The Subscriber acknowledges and consents to the fact that the Company and the Agents are
collecting the Subscriber’s (and any beneficial purchaser for which the Subscriber is contracting
hereunder) personal information for the purpose of completing the Subscriber’s subscription. The
Subscriber acknowledges and consents to the Company and Agents retaining the personal information
for so long as permitted or required by applicable law or business practices. The Subscriber
further acknowledges and consents to the fact that the Company or the Agents may be required by
Securities Laws, stock exchange rules and/or the Investment Industry Regulatory Organization of
Canada rules and the Financial Industry Regulatory Authority, Inc. rules to provide regulatory
authorities any personal information provided by the Subscriber respecting itself (and any
beneficial purchaser for which the Subscriber is contracting hereunder). The Subscriber represents
and warrants that it has the authority to provide the
consents and acknowledgements set out in this paragraph on behalf of all beneficial purchasers
for which the Subscriber is contracting. In addition to the foregoing, the Subscriber agrees and
acknowledges that the Company or the Agents, as the case may be, may use and disclose its personal
information, or that of each beneficial purchaser for whom it is contracting hereunder, including
as follows:

A-16 

 

	 	(a)	 	for internal use with respect to managing the relationships between and
contractual obligations of the Company, the Agents and the Subscriber or any beneficial
purchaser for whom the Subscriber is contracting hereunder;
	 
	 	(b)	 	for use and disclosure for income tax related purposes, including where
required by law, disclosure to any Canadian or US taxation authority;
	 
	 	(c)	 	for disclosure to securities regulatory authorities and other regulatory bodies
with jurisdiction with respect to reports of trades and similar regulatory filings;
	 
	 	(d)	 	for disclosure to a governmental or other authority to which the disclosure is
required by court order or subpoena compelling such disclosure and where there is no
reasonable alternative to such disclosure;
	 
	 	(e)	 	for disclosure to professional advisers of the Company or the Agents in
connection with the performance of their professional services;
	 
	 	(f)	 	for disclosure to any person where such disclosure is necessary for legitimate
business reasons and is made with the Subscriber’s prior written consent;
	 
	 	(g)	 	for disclosure to a court determining the rights of the parties under this
Subscription Agreement; or
	 
	 	(h)	 	for use and disclosure as otherwise required or permitted by law.

     The contact information for the officer and for counsel of the Company who can answer
questions about this collection of information is as follows:

	 	 	 
	Swisher Hygiene Inc.

	 	Akerman Senterfitt
	4725 Piedmont Row Drive, Suite 400

	 	350 East Las Olas Boulevard, Suite 1600
	Charlotte, North Carolina,

	 	Fort Lauderdale, Florida
	28210

	 	33301-2229
	 
	 	 
	Attention: Tom Aucamp

	 	Attention: Edward Ristaino
	Facsimile: (704) 602-7970

	 	Facsimile: (954) 463-2224

     The Subscriber acknowledges that the Company is required to file with the Ontario Securities
Commission (“OSC”) a report setting out the Subscriber’s name, address and telephone number, the
number and type of securities issued, the date of issuance and the purchase price of the securities
issued to the Subscriber. Such information is collected indirectly by the OSC under the authority
granted to it in securities legislation, for the purposes of the administration and enforcement of
the securities legislation of Ontario. By submitting this Subscription Agreement, the Subscriber
authorizes such indirect collection of the information by the OSC. The following official can
answer questions about the OSC’s indirect collection of the information:

A-17 

 

	 	 	 
	Administrative Assistant to the Director of Corporate Finance

Suite 903, Box 5520 Queen Street West

Toronto, Ontario M5H 3S8
	 
	 	 
	Telephone:

	 	(416) 593-8086
	Facsimile:

	 	(416) 593-8252

ARTICLE 11 — MISCELLANEOUS

11.1 Further Assurances

     Each of the parties hereto upon the request of each of the other parties hereto, whether
before or after the Closing Time, shall do, execute, acknowledge and deliver or cause to be done,
executed, acknowledged and delivered all such further acts, deeds, documents, assignments,
transfers, conveyances, powers of attorney and assurances as may reasonably be necessary or
desirable to complete the transactions contemplated herein.

11.2 Notices

	 	(a)	 	Any notice, direction or other instrument required or permitted to be given to
any party hereto shall be in writing and shall be sufficiently given if delivered
personally, or transmitted by facsimile tested prior to transmission to such party, as
follows:

	 	(i)	 	in the case of the Company, to:
	 
	 	 	 	Swisher Hygiene Inc.

4725 Piedmont Row Drive, Suite 400

Charlotte, North Carolina, 28210

Attention: Tom Aucamp

Fax: (704) 602-7970

with a copy to:

Akerman Senterfitt

350 East Las Olas Boulevard, Suite 1600

Fort Lauderdale, Florida

33301-2229

Attention: Edward Ristaino

Fax: (954) 463-2224
	 
	 	(ii)	 	in the case of the Subscriber, at the address specified on the
face page hereof, with a copy to the Agents at:

	 	 	 
	Clarus Securities Inc.

	 	Broadband Capital Management LLC
	Exchange Tower, 130 King Street West,

	 	712 5th Avenue
	Suite 3640

	 	22nd Floor
	Toronto, Ontario M5X 1A9

	 	New York, New York 10019
	 
	 	 
	Attention: April Cuadra

	 	Attention: Erika Duckett
	Fax: (416) 343-2799

	 	Fax (212) 702-9830

A-18 

 

	 	(b)	 	Any such notice, direction or other instrument, if delivered personally, shall
be deemed to have been given and received on the day on which it was delivered,
provided that if such day is not a Business Day then the notice, direction or other
instrument shall be deemed to have been given and received on the first Business Day
next following such day and if transmitted by fax or electronic transmission, shall be
deemed to have been given and received on the day of its transmission, provided that if
such day is not a Business Day or if it is transmitted or received after the end of
normal business hours then the notice, direction or other instrument shall be deemed to
have been given and received on the first Business Day next following the day of such
transmission.
	 
	 	(c)	 	Any party hereto may change its address for service from time to time by notice
given to each of the other parties hereto in accordance with the foregoing provisions.

11.3 Time of the Essence

     Time shall be of the essence of this Subscription Agreement and every part hereof.

11.4 Costs and Expenses

     All costs and expenses (including, without limitation, the fees and disbursements of legal
counsel) incurred in connection with this Subscription Agreement and the transactions herein
contemplated shall be paid and borne by the party incurring such costs and expenses.

11.5 Applicable Law

     This Subscription Agreement shall be construed and enforced in accordance with, and the rights
of the parties shall be governed by, the laws of the Province of Ontario and the laws of Canada
applicable therein. Any and all disputes arising under this Subscription Agreement, whether as to
interpretation, performance or otherwise, shall be subject to the non-exclusive jurisdiction of the
courts of the Province of Ontario and each of the parties hereto hereby irrevocably attorns to the
jurisdiction of the courts of such province.

11.6 Entire Agreement

     This Subscription Agreement, including the Schedules hereto, the Agency Agreement and the
Subscription Receipt Agreement constitutes the entire agreement between the parties with respect to
the transactions contemplated herein and cancels and supersedes any prior understandings,
agreements, negotiations and discussions between the parties. There are no representations,
warranties, terms, conditions, undertakings or collateral agreements or understandings, express or
implied, between the parties hereto other than those expressly set forth in this Subscription
Agreement or in any such agreement, certificate, affidavit, statutory declaration or other document
as aforesaid. This Subscription Agreement may not be amended or modified in any respect except by
written instrument executed by each of the parties hereto.

11.7 Counterparts

     This Subscription Agreement may be executed in two or more counterparts, each of which shall
be deemed to be an original and all of which together shall constitute one and the same
Subscription Agreement. Counterparts may be delivered either in original or faxed form and the
parties adopt any signature received by a receiving fax machine as original signatures of the
parties.

11.8 Electronic Delivery of Subscription

     The Company shall be entitled to rely on delivery by fax or e-mail of an executed copy of this
Subscription Agreement, including the completed Schedules to this Subscription Agreement, and
acceptance by the Company of the fax or e-mail copy shall be legally effective to create a valid
and binding agreement between the Subscriber and the Company in accordance with the terms of this
Subscription Agreement.

A-19 

 

11.9 Amendments

     The provisions of this Subscription Agreement may only be amended with the written consent of
the other parties hereto.

11.10 Assignment

     This Subscription Agreement may not be assigned by either party except with the prior written
consent of the other parties hereto.

11.11 Enurement

     This Subscription Agreement shall enure to the benefit of and be binding upon the parties
hereto and their respective heirs, executors, successors (including any successor by reason of the
amalgamation or merger of any party), administrators and permitted assigns.

11.12 Language

     Each of the Company and the Subscriber hereby acknowledges that it has consented and requested
that all documents evidencing or relating in any way to the Subscription Receipts and this
Subscription Agreement be drawn up in the English language only. La Société et le souscripteur
reconnaissent par les présentes avoir consenti et demandé que tous les documents faisant foi ou se
rapportant de quelque manière a la vente d’actions ordinaires de la société et à la présente
convention de souscription soient rédigés en anglais seulement.

A-20 

 

SCHEDULE “B”

SWISHER HYGIENE INC.

TERM SHEET

PRIVATE PLACEMENT OF SUBSCRIPTION RECEIPTS

 

	 	 	 
	Issuer:
	 	Swisher Hygiene Inc. (the “Company”).

	 
	 	 

	Acquisition:
	 	The Company has entered into an agreement to
acquire (the “Acquisition”) Choice
Environmental Services Inc. (“Choice
Environmental”), a company based in Fort
Lauderdale, Florida, a provider of solid
waste and recycling collection,
transportation, processing and disposal
services. The Acquisition, which is
anticipated to close in March 2011, is
expected to be funded with shares of common
stock of the Company.

	 
	 	 

	Offering:
	 	12,262,500 Subscription Receipts (the
“Subscription Receipts”). Each Subscription
Receipt will entitle the holder thereof to
receive upon the closing of the Acquisition,
and without additional consideration, one
share of common stock (a “Common Share”) of
the Company. All of the gross proceeds (the
“Escrowed Funds”) of the offering (the
“Offering”) will be held in escrow pending
completion of the Acquisition. If the
closing of the Acquisition does not take
place before March 31, 2011, the Escrowed
Funds will be returned to holders of the
Subscription Receipts, including interest
thereon.

	 
	 	 

	Size of Offering:
	 	CAD$58,246,875.

	 
	 	 

	Price:
	 	CAD$4.75 per Subscription Receipt.

	 
	 	 

	Use of Proceeds:
	 	The net proceeds of the Offering will be
used to extinguish up to approximately
USD$43 million of debt indirectly assumed by
the Company in connection with the proposed
Acquisition, with the balance for general
corporate purposes.

	 
	 	 

	Hold Periods:
	 	Transfer of the Subscription Receipts and
the underlying Common Shares are subject to
all applicable securities laws and the
Subscription Receipts may not be transferred
to insiders of the Company. As described in
more detail below, for those investors who
are not “affiliates” of the Company, as
defined under the US Securities Act (as
defined below), the securities sold under
the Offering will be subject to a “hold
period” that will expire on the later of:

	 
	 	 

	 	 	a) a contractual hold period (the
“Contractual Hold Period”) of four months
from the Closing Date of the Offering; and

	 
	 	 

	 	 	the earlier of: (i) upon effectiveness of a
resale registration statement in the United
States, and (ii) one year after the Company
has filed “Form 10 information” (as defined
in Rule 144(i)(3) under the US Securities
Act) with the Commission (as defined below),
anticipated to expire on November 10, 2011.

B-1 

 

	 	 	 
	Resale Restrictions and
Filing of U.S. Registration
Statement:
	 	The securities issued in the Offering, and
issuable upon exchange or exercise, are
“restricted securities” as defined in Rule
144 under the US Securities Act, and may not
be resold without registration under the
U.S. Securities Act and applicable state
securities laws unless an exemption from
registration is available. The Company
agrees to file a registration statement with
the U.S. Securities and Exchange Commission
(the “Commission”) for resale of the Common
Shares (as defined below) under the US
Securities Act as soon as practicable after
Closing, and, to use commercially reasonable
efforts to cause the registration statement
to become effective and to remain effective
until the later of (i) six months following
the Closing Date, (ii) November 10, 2011,
and (iii) 12 months following the date that
the Company has filed “Form 10 information”
(as defined in Rule 144(i)(3) under the US
Securities Act) with the Commission. In the
event that the registration statement has
not become effective, for whatever reason,
on or before the date that is 6 months
following the Closing, or, subject to
provisions of the Delay Period (as defined
below), ceases to be effective at any time
that it is required to remain effective
hereunder, the initial purchasers of the
Subscription Receipts will be entitled to
receive an additional 0.10 of a Common Share
for each Common Share underlying the
Subscription Receipts still subject to US
resale restrictions (the “Penalty Shares”).
Notwithstanding the issuance of these
Penalty Shares, the obligation to obtain and
maintain effectiveness of a registration
statement shall remain binding on the
Company. In addition, the Subscription
Receipts (and underlying Common Shares)
issuable on the Closing Date will be subject
to a four month hold period commencing on
the Closing Date, pursuant to (i) National
Instrument 45-102 in Canada, and (ii) the
Contractual Hold Period applicable to all
subscribers in the Offering. A “legend” in
the form prescribed by National Instrument
45-102 or other applicable securities
legislation, including US securities laws,
or stock exchange rules will appear on the
securities certificates, together with such
additional legends as may be appropriate in
the circumstances. Notwithstanding the
Company’s agreement to file a resale
registration statement, the Company may
delay or suspend the effectiveness of the
Registration Statement (a “Delay Period”) if
the board of directors of the Company
determines in good faith that effectiveness
should be suspended in accordance with the
rules and regulations under the US
Securities Act or that the disclosure of
material non-public information at such time
would be detrimental to the Company and its
subsidiaries, taken as a whole; provided
that the term of any Delay Period and any
period(s) during which the registration
statement is not available to enable holders
to effect resales thereunder, shall extend
the period the registration statement is
required to be effective. The aggregate
Delay Period for all pending developments
shall not exceed 45 calendar days in any
180-day period. Notwithstanding the
foregoing, the Company shall use its
commercially reasonable efforts to ensure
that the registration statement is declared
effective and its permitted use is resumed
following a suspension as promptly as
practicable and that in no event will a
Delay Period be in effect or the ability of
holders to effect resales under such
registration statement be impaired during
any period in which the Company is effecting
a primary public offering of its securities
in the United States or Canada, thus giving
effect to the intention that purchasers in
this Offering shall have the ability to
effect public resales
of their securities at
the same time and on the same basis as
purchasers in any such primary public
offering.

	 
	 	 

	Condition to Closing:
	 	The Company shall have entered into a
definitive transaction agreement in
connection with the acquisition of Choice
Environmental Services Inc., such
transaction to be in form and substance
generally consistent with the description of
such provided to the subscribers.

	 
	 	 

	Offering Jurisdictions:
	 	Private placement to “accredited investors”
in the provinces of Canada (collectively,
the “Offering Jurisdictions”), and into the
United States pursuant to Regulation D under
the United States Securities Act of 1933, as
amended (the “US Securities Act”) or in such
other manner as to not require registration
under the U.S. Securities Act, and
jurisdictions other than Canada and the
United States, provided that the Company is
not required to file a prospectus or other
disclosure document or become subject to
continuing reporting obligations in such
other jurisdictions.

	 
	 	 

	Form of Offering:
	 	Marketed, subject to an agency agreement
containing “material adverse change”,
“regulatory”, “disaster” and “market out”
out clauses, customary for a transaction of
this nature running to the Closing Date.

	 
	 	 

	Listing and Regulatory
Approval:
	 	The Common Shares trade on the Toronto Stock
Exchange under the symbol “SWI” and on the
NASDAQ under the symbol “SWSH”. The closing
of the Offering is subject to approval of
the Toronto Stock Exchange.

	 
	 	 

	Eligibility for Investment:
	 	Subject to standard qualifications, the
Subscription Receipts and underlying
securities will be eligible for investment
for RRSPs, RESPs, RRIFs, DPSPs and TFSAs
under the Income Tax Act (Canada).

	 
	 	 

	Closing Date:
	 	On or about February 23, 2011

B-2 

 

SCHEDULE “C”

CERTIFICATE OF SUBSCRIBERS

UNITED STATES ACCREDITED INVESTOR CERTIFICATE

	 	 	 
	TO:
	 	SWISHER HYGIENE INC. (the “Company”)

	 	 	 

	AND TO:
	 	CLARUS SECURITIES INC. and BROADBAND CAPITAL MANAGEMENT LLC (the “Agents”)

	 	 	 

	RE:
	 	SUBSCRIPTION FOR SUBSCRIPTION RECEIPTS OF THE COMPANY

 

Capitalized terms not otherwise defined herein shall have the meanings attributed thereto in the
subscription agreement to which this certificate was attached.

The undersigned (the “Subscriber”) represents, warrants and covenants to the Company that:

1. the Subscriber (and if the Subscriber is acting on behalf of a principal, then also for the
principal for whom the Subscriber is acting) satisfies one or more of the categories of “accredited
investor” as that term is defined in Rule 501 of the Securities Act of 1933, as amended (the “U.S.
Securities Act”), by virtue of the Subscriber being:

[please indicate “Sub” for Subscriber, and if acting on behalf of one or more beneficial purchaser,
“BP” for each beneficial purchaser]

	 	 	 
	           Category 1.
	 	An organization described in Section 501(c)(3) of the
United States Internal Revenue Code, a corporation, a
Massachusetts or similar business trust or partnership,
not formed for the specific purpose of acquiring the
Subscription Receipts, with total assets in excess of
US$5,000,000

	 
	 	 

	           Category 2.
	 	A natural person whose individual net worth or joint net
worth with that person’s spouse, at the date hereof,
exceeds US$1,000,000, excluding the value of the primary
residence of such natural person, calculated by
subtracting from the estimated fair market value of the
property the amount of debt secured by the property, up
to the estimated fair market value of the property

	 	 	 

	           Category 3.
	 	A natural person who had an individual income in excess
of US$200,000 in each of the two most recent years or
joint income with that person’s spouse in excess of
US$300,000 in each of those years and has a reasonable
expectation of reaching the same income level in the
current year

	 	 	 

	           Category 4.
	 	A trust that: (a) has total assets in excess of
US$5,000,000, (b) was not formed for the specific
purpose of acquiring the Subscription Receipts, and (c)
is directed in its purchases of securities by a person
who has such knowledge and experience in financial and
business matters that he/she is capable of evaluating
the merits and risks of an investment in the
Subscription Receipts

C-1 

 

	 	 	 
	           Category 5.
	 	Any bank as defined in Section 3(a)(2) of the U.S.
Securities Act or any savings and loan association or
other institution as defined in Section 3(a)(5)(A) of
the U.S. Securities Act whether acting in its individual
or fiduciary capacity; any broker dealer registered
pursuant to Section 15 of the United States Securities
Exchange Act of 1934; any insurance company as defined
in Section 2(13) of the U.S. Securities Act; any
investment company registered under the Investment
Company Act of 1940 or a business development company as
defined in Section 2(a)(48) of that Act; any Small
Business Investment Company licensed by the U.S. Small
Business Administration under Section 301(c) or (d) of
the Small Business Investment Act of 1958; any plan
established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a
state or its political subdivisions, for the benefit of
its employees, if such plan has total assets in excess
of US$5,000,000; or any employee benefit plan within the
meaning of the Employee Retirement Income Security Act
of 1974 (“ERISA”), if the investment decision is made by
a plan fiduciary, as defined in Section 3(21) of ERISA,
which is either a bank, savings and loan association,
insurance company, or registered investment adviser, or
if the employee benefit plan has total assets in excess
of US$5,000,000, or, if a self-directed plan, with
investment decisions made solely by persons that are
Accredited Investors

	 	 	 

	           Category 6.
	 	Any director or executive officer of the issuer of the
securities being offered or sold.

	 	 	 

	           Category 7.
	 	A private business development as defined in Section
202(a)(22) of the Investment Advisors Acts of 1940

	 	 	 

	           Category 8.
	 	An entity in which all of the equity owners satisfy the
requirements of one or more of the foregoing categories

2. (a) if the undersigned is the Subscriber, he or she is making the above statement based on
personal knowledge of his or her financial situation and has reviewed personal financial
documentation with an accountant, financial advisor or other financial professional, if necessary,
to determine that the above statement is true; or (b) if the undersigned is other than the
Subscriber, he or she is making the above statement based on a review, if necessary, of the
financial statements of the Subscriber for the most recently completed financial year and any
interim financial statements prepared since the end of such financial year and has undertaken such
other review and due diligence necessary to determine and certify that the Subscriber is an
“accredited investor” as that term is defined in Rule 501(a) or any entity in which all of the
equity owners are “accredited investors” under the U.S. Securities Act; and

3. the Subscriber understands that the Company is relying on this certificate as evidence of the
Subscriber’s status as an institutional “accredited investor” in accordance with Rule 501(a) of the
U.S. Securities Act and further understands that the Company may, in its sole discretion, require
the Subscriber to execute a new and separate certificate each time the Subscriber subscribes for
additional Subscription Receipts.

DATED at                           this                 day of                           
                                 , 2011.

	 	 	 
	 
	 	 
	 

Signature of Subscriber (if an individual)

	 	 

Name of Subscriber (if not an individual)
	 
	 
	 	 
	 

Name of Subscriber (if an individual)

	 	Per:  

(Signature of Authorized Representative)
	 
	 	 
	 

	 	 

Name and Title of Authorized Representative

C-2 

 

SCHEDULE “D”

CANADIAN ACCREDITED INVESTOR CERTIFICATE

The Subscriber or its disclosed principal, as the case may be, hereby represents, warrants and
certifies (by completing and signing this certificate below) on its own behalf or, if applicable,
on behalf of those for whom the Subscriber is contracting hereunder, to the Company and its counsel
(which representations, warranties and certifications shall survive Closing) and acknowledges that
the Company and its counsel are relying thereon that the Subscriber or, if applicable, its
disclosed principal, is a resident of or otherwise subject to the securities legislation of a
province or territory of Canada, the Subscriber or such disclosed principal is an “accredited
investor”, as such term is defined in National Instrument 45-106 — Prospectus and Registration
Exemptions (“NI 45-106”) and, as at the time the subscription is accepted by the Company, the
Subscriber or the disclosed principal, as the case may be, will fall within one or more of the
following categories (Please initial one or more, as applicable):

	 	 	 	 	 
	______

	 	(a)
	 	a Canadian financial institution, or an authorized foreign bank named in Schedule III
of the Bank Act (Canada);
	 
	 	 	 	 
	______

	 	(b)
	 	the Business Development Bank of Canada incorporated under the Business Development
Bank of Canada Act (Canada);
	 
	 	 	 	 
	______

	 	(c)
	 	a subsidiary of any person referred to in paragraphs (a) or (b), if the person owns all
of the voting securities of the subsidiary, except the voting securities required by
law to be owned by directors of that subsidiary;
	 
	 	 	 	 
	______

	 	(d)
	 	a person registered under the securities legislation of a jurisdiction of Canada as an
adviser or dealer, other than a person registered solely as a limited market dealer
registered under one or both of the Securities Act (Ontario) or the Securities Act
(Newfoundland and Labrador);
	 
	 	 	 	 
	______

	 	(e)
	 	an individual registered or formerly registered under the securities legislation of a
jurisdiction of Canada as a representative of a person referred to in paragraph (d);
	 
	 	 	 	 
	______

	 	(f)
	 	the Government of Canada or a jurisdiction of Canada, or any crown corporation, agency
or wholly owned entity of the Government of Canada or a jurisdiction of Canada;
	 
	 	 	 	 
	______

	 	(g)
	 	a municipality, public board or commission in Canada and a metropolitan community,
school board, the Comité de gestion de la taxe scolaire de l’île de Montréal or an
intermunicipal management board in Québec;
	 
	 	 	 	 
	______

	 	(h)
	 	any national, federal, state, provincial, territorial or municipal government of or in
any foreign jurisdiction, or any agency of that government;
	 
	 	 	 	 
	______

	 	(i)
	 	a pension fund that is regulated by either the Office of the Superintendent of
Financial Institutions (Canada) or a pension commission or similar regulatory authority
of a jurisdiction of Canada;
	 
	 	 	 	 
	______

	 	(j)
	 	an individual who, either alone or with a spouse, beneficially owns, directly or
indirectly, financial assets having an aggregate realizable value that before taxes,
but net of any related liabilities, exceeds $1,000,000;
	 
	 	 	 	 
	______

	 	(k)
	 	an individual whose net income before taxes exceeded $200,000 in each of the two most
recent calendar years or whose net income before taxes combined with that of a spouse
exceeded $300,000 in each of the two most recent calendar years and who, in either
case, reasonably expects to exceed that net income level in the current year;

D-1

 

	 	 	 	 	 
	 
	 	 	 	 
	______

	 	(l)
	 	an individual who, either alone or with a spouse, has net assets of at least $5,000,000;
	 
	 	 	 	 
	______

	 	(m)
	 	a person, other than an individual or investment fund, that has net assets of at least
$5,000,000 as shown on its most recently prepared financial statements;
	 
	 	 	 	 
	______

	 	(n)
	 	an investment fund that distributes or has distributed its securities only to (i) a
person that is or was an accredited investor at the time of the distribution, (ii) a
person that acquires or acquired securities in the circumstances referred to in section
2.10 of NI 45-106 or section 2.19 of NI 45-106, or (iii) a person described in
paragraph (i) or (ii) that acquires or acquired securities under section 2.18 of NI
45-106;
	 
	 	 	 	 
	______

	 	(o)
	 	an investment fund that distributes or has distributed securities under a prospectus in
a jurisdiction of Canada for which the regulator or, in Québec, the securities
regulatory authority, has issued a receipt;
	 
	 	 	 	 
	______

	 	(p)
	 	a trust company or trust corporation registered or authorized to carry on business
under the Trust and Loan Companies Act (Canada) or under comparable legislation in a
jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a fully managed
account managed by the trust company or trust corporation, as the case may be;
	 
	 	 	 	 
	______

	 	(q)
	 	a person acting on behalf of a fully managed account managed by that person, if that
person (i) is registered or authorized to carry on business as an adviser or the
equivalent under the securities legislation of a jurisdiction of Canada or a foreign
jurisdiction and (ii) in Ontario, is purchasing a security that is not a security of an
investment fund;
	 
	 	 	 	 
	______

	 	(r)
	 	a registered charity under the Income Tax Act (Canada) that, in regard to the trade,
has obtained advice from an eligibility adviser or other adviser registered under the
securities legislation of the jurisdiction of the registered charity to give advice on
the securities being traded;
	 
	 	 	 	 
	______

	 	(s)
	 	an entity organized in a foreign jurisdiction that is analogous to any of the entities
referred to in paragraphs (a) to (d) or paragraph (i) in form and function;
	 
	 	 	 	 
	______

	 	(t)
	 	a person in respect of which all of the owners of interests, direct, indirect or
beneficial, except the voting securities required by law to be owned by directors, are
persons that are accredited investors;
	 
	 	 	 	 
	______

	 	(u)
	 	an investment fund that is advised by a person registered as an advisor or a person
that is exempt from registration as an advisor; or
	 
	 	 	 	 
	______

	 	(v)
	 	a person that is recognized or designated by the securities regulatory authority or,
except in Ontario and Québec, the regulator as an accredited investor.

For the purposes of the representation and warranties set out above, the terms set out below shall
have the following meanings:

“bank” means a bank named in Schedule I or II of the Bank Act (Canada);

“Canadian financial institution” means

	 	(a)	 	an association governed by the Cooperative Credit Associations Act (Canada) or
a central cooperative credit society for which an order has been made under section
473(1) of that Act, or
	 
	 	(b)	 	a bank, loan corporation, trust company, trust corporation, insurance company,
treasury branch, credit union, caisse populaire, financial services cooperative, or
league that, in each case, is authorized by an enactment of Canada or a jurisdiction of
Canada to carry on business in Canada or a jurisdiction of Canada;

D-2

 

“director” means

	 	(a)	 	a member of the board of directors of a company or an individual who performs
similar functions for a company, and

	 	(b)	 	with respect to a person that is not a company, an individual who performs
functions similar to those of a director of a company;

“eligibility adviser” means

	 	(a)	 	a person that is registered as an investment dealer and authorized to give
advice with respect to the type of security being distributed, and

	 	(b)	 	in Saskatchewan or Manitoba, also means a lawyer who is a practicing member in
good standing with a law society of a jurisdiction of Canada or a public accountant who
is a member in good standing of an institute or association of chartered accountants,
certified general accountants or certified management accountants in a jurisdiction of
Canada provided that the lawyer or public accountant must not (i) have a professional,
business or personal relationship with the issuer, or any of its directors, executive
officers, founders, or control persons, and (ii) have acted for or been retained
personally or otherwise as an employee, executive officer, director, associate or
partner of a person that has acted for or been retained by the issuer or any of its
directors, executive officers, founders or control persons within the previous 12
months;

“financial assets” means

	 	(a)	 	cash,
	 
	 	(b)	 	securities, or
	 
	 	(c)	 	a contract of insurance, a deposit or an evidence of a deposit that is not a
security for the purposes of securities legislation;

“fully managed account” means an account of a client for which a person makes the investment
decisions if that person has full discretion to trade in securities for the account without
requiring the client’s express consent to a transaction;

“individual” means a natural person, but does not include a partnership, unincorporated
association, unincorporated organization, trust or a natural person in his or her capacity as
trustee, executor, administrator or other legal personal representative;

“instrument” means National Instrument 45-106 — Prospectus and Registration Exemptions of the
Canadian Securities Administrators;

“investment fund” has the same meaning as in National Instrument 81-106 — Investment Fund
Continuous Disclosure;

“jurisdiction” means a province or territory of Canada except when used in the term foreign
jurisdiction;

“mutual fund” has the meaning ascribed to such term under the securities legislation of the
applicable jurisdiction;

“non-redeemable investment fund” has the same meaning as in National Instrument 81-106 —
Investment Fund Continuous Disclosure;

“officer” means the chair, any vice chair of the board of directors, the president, any vice
president, the secretary, the assistant secretary, the treasurer, the assistant treasurer, and the
general manager of a company, and any other

D-3

 

person designated an officer or a company by law or similar authority, or any individual acting in
a similar capacity on behalf of the issuer;

“person” includes

	 	(a)	 	an individual,
	 
	 	(b)	 	a corporation,
	 
	 	(c)	 	a partnership, trust, fund and an association, syndicate, organization or other
organized group of persons, whether incorporated or not, and
	 
	 	(d)	 	an individual or other person in that person’s capacity as a trustee, executor,
administrator or personal or other legal representative;

“related liabilities” means

	 	(a)	 	liabilities incurred or assumed for the purpose of financing the acquisition or
ownership of financial assets, or
	 
	 	(b)	 	liabilities that are secured by financial assets;

“Schedule III bank” means an authorized foreign bank named in Schedule III of the Bank Act
(Canada);

“spouse” means, an individual who,

	 	(a)	 	is married to another individual and is not living separate and apart within
the meaning of the Divorce Act (Canada), from the other individual,

	 	(b)	 	is living with another individual in a marriage-like relationship, including a
marriage-like relationship between individuals of the same gender, or

	 	(c)	 	in Alberta, is an individual referred to in paragraph (a) or (b), or is an
adult interdependent partner within the meaning of the Adult Interdependent
Relationships Act (Alberta);

“subsidiary” means an issuer that is controlled directly or indirectly by another issuer and
includes a subsidiary of that subsidiary.

Control

A person (first person) is considered to control another person (second person) if

	 	(a)	 	the first person, directly or indirectly, beneficially owns or exercises
control or direction over securities of the second person carrying votes which, if
exercised, would entitle the first person to elect a majority of the directors of the
second person, unless that first person holds the voting securities only to secure an
obligation,
	 
	 	(b)	 	the second person is a partnership, other than a limited partnership, and the
first person holds more than 50% of the interests of the partnership, or
	 
	 	(c)	 	the second person is a limited partnership and the general partner of the
limited partnership is the first person.

* * * * * * * * *

D-4

 

The foregoing representations contained in this certificate are true and accurate as of the date
hereof and will be true and accurate as of the Closing Date. If any such representations shall not
be true and accurate prior to the Closing Date, the Subscriber shall give immediate notice to the
Company.

EXECUTED by the Subscriber at _______________ this ______ day of ________________, 2011.

	 	 	 
	If a corporation, partnership or other entity:

	 	If an individual:
	 
	 	 
	 
	 	 
	 

	 	 
	Print Name of Subscriber

	 	Print Name
	 
	 	 
	 
	 	 
	 

	 	 
	Signature of Authorized Signatory

	 	Signature
	 
	 	 
	 
	 	 
	 

	 	 
	Name and Position of Authorized Signatory

	 	Jurisdiction of Residence
	 
	 	 
	 
	 	 
	 

	 	 
	Jurisdiction of Residence

	 	Print Name of Witness
	 
	 	 
	 
	 	 
	 

	 	 
	 

	 	Signature of Witness

D-5

 

SCHEDULE “E”

CERTIFICATE OF NON-CANADIAN SUBSCRIBERS

(OTHER THAN U.S. SUBSCRIBERS)

The Subscriber or its disclosed principal, as the case may be, hereby represents, warrants and
certifies (by completing and signing this certificate below) on its own behalf or, if applicable,
on behalf of those for whom the Subscriber is contracting hereunder, to the Company and its counsel
(which representations, warranties and certifications shall survive the Closing) and acknowledges
that the Company and its counsel are relying thereon that the Subscriber or, if applicable, its
disclosed principal, is a resident of or otherwise subject to, the securities legislation of a
jurisdiction other than Canada or the United States, and:

	 	(a)	 	the Subscriber is, and (if applicable) any other purchaser for whom it is
contracting hereunder, is:

	 	(i)	 	a purchaser that is recognized by the securities regulatory
authority in the jurisdiction in which it is, and (if applicable) any other
purchaser for whom it is contracting hereunder is resident or otherwise subject
to the securities laws of such jurisdiction, as an exempt purchaser and is
purchasing the Subscription Receipts as principal for its, or (if applicable)
each such other purchaser’s, own account, and not for the benefit of any other
person; or

	 	(ii)	 	a purchaser which is purchasing Subscription Receipts pursuant
to an exemption from any prospectus or securities registration requirements
(particulars of which are enclosed herewith) available to the Company, the
Subscriber and any such other purchaser under applicable securities laws of
their jurisdiction of residence or to which the Subscriber and any such other
purchaser are otherwise subject to, and the Subscriber and any such other
purchaser shall deliver to the Company such further particulars of the
exemption and their qualification thereunder as the Company may reasonably
request;

	 	(b)	 	the purchase of Subscription Receipts by the Subscriber, and (if applicable)
each such other purchaser, does not contravene any of the applicable securities laws in
such jurisdiction and does not trigger: (i) any obligation to prepare and file a
prospectus, an offering memorandum or similar document, or any other ongoing reporting
requirements with respect to such purchase or otherwise; or (ii) any registration,
filing or other obligation on the part of the Company; and

	 	(c)	 	the Subscriber, and (if applicable) any other purchaser for whom we are
contracting hereunder will not sell or otherwise dispose of any Subscription Receipts,
except in accordance with applicable securities laws including in Canada and the United
States, and if the Subscriber, or (if applicable) such beneficial purchaser sells or
otherwise disposes of any Subscription Receipts to a person other than a resident of
Canada or the United States, as the case may be, the Subscriber, and (if applicable)
such beneficial purchaser, will obtain from such purchaser representations, warranties
and covenants in the same form as provided in this Subscription Agreement and Schedule
D and shall comply with such other requirements as the Company may reasonably require.

Dated at _____________ this ________ day of _______________, 2011.

	 	 	 	 	 
	 	 	 
	 	 	Name of Subscriber
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Signature
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	 	 	Title

E-1

 

SCHEDULE “F”

REGISTRATION RIGHTS

Capitalized terms not otherwise defined herein shall have the meanings attributed thereto in the
Subscription Agreement to which this schedule is attached. The terms of this Schedule “F” are
incorporated by reference into the Subscription Agreement to which it is attached.

          Section 1. Definitions. As used in this Schedule, the following terms have the
respective meanings set forth in this Section 1:

          “Advice” has the meaning set forth in Section 7(c).

          “Commission” means the U.S. Securities and Exchange Commission.

          “Effective Date” means the date on which the Registration Statement is first declared
effective by the Commission.

          “Effectiveness Period” has the meaning set forth in Section 2(a).

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

          “Holder” or “Holders” means the Investors and other holder or holders (assignees pursuant to
Section 7(f) hereof), as the case may be, from time to time of Registrable Securities.

          “Indemnified Party” has the meaning set forth in Section 6(c).

          “Indemnifying Party” has the meaning set forth in Section 6(c).

          “Investor” means the Subscriber pursuant to the Subscription Agreement to which this Schedule
is attached.

          “Losses” has the meaning set forth in Section 6(a).

          “Proceeding” means an action, claim, suit, investigation or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition), whether commenced or
threatened.

          “Prospectus” means the final prospectus included in the Registration Statement (including,
without limitation, a prospectus that includes any information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule 430A promulgated under
the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the
terms of the offering of any portion of the Registrable Securities covered by the Registration
Statement, and all other amendments and supplements to the Prospectus, including post effective
amendments, and all material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.

          “Registrable Securities” means: (i) the Shares and Penalty Shares, and (ii) any securities
issued or issuable upon any stock split, dividend or other distribution, recapitalization or
similar event. Such securities will cease to be Registrable Securities upon transfer pursuant to
the Registration Statement or Rule 144 under the Securities Act or at such time as such securities
become transferable without any restrictions or limitations in accordance with Rule 144(b) (or any
successor provision).

          “Registration Statement” means the registration statement required to be filed hereunder,
including the Prospectus, amendments and supplements to such registration statements or Prospectus,
including pre
and post effective amendments, all exhibits thereto, and all material incorporated by
reference or deemed to be incorporated by reference therein.

F-1

 

          “Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.

          “Rule 415” means Rule 415 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.

          “Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.

          “Securities Act” means the United States Securities Act of 1933, as amended.

          “Shares” means the shares of Common Stock issued or issuable to the Investors pursuant to the
Subscription Receipt Agreement.

          “Trading Day” means any day on which the TSX or the Nasdaq is open for trading.

Section 2. Registration.

	 	(a)	 	The Company shall prepare and file with the Commission the Registration
Statement covering the resale of all Registrable Securities for an offering to be made
on a continuous basis pursuant to Rule 415, on Form S-1 (or on such other form
appropriate for such purpose if the Company then qualifies for the use of Form S-3 or
such other form of SEC registration statement). Such Registration Statement shall
contain (except if otherwise required pursuant to written comments received from the
Commission upon a review of the Registration Statement) the “Plan of Distribution”
attached hereto as Annex A. The Company shall use commercially reasonable efforts to
cause the Registration Statement to be declared effective under the Securities Act as
soon as possible and in any event by no later than the date which is six months after
the Closing Date, and shall use its commercially reasonable efforts to keep the
Registration Statement continuously effective and available for use by Holders under
the Securities Act until the date which is the latest of (i) six months after the
Closing Date or (ii) such time as all of the Registrable Securities covered by the
Registration Statement have been publicly sold by the Holders or (iii) at such time as
all of the Registrable Securities become transferable without any restrictions or
limitations in accordance with Rule 144(b)(1) (or any successor provision) or (iv)
November 10, 2011 (the “Effectiveness Period”).
	 
	 	(b)	 	Within three business days following the date on which the Registration
Statement is declared effective by the Commission, and assuming no stop-order has been
issued with respect to the Registration Statement, the Company shall furnish to each
Holder a letter, dated such date, of outside counsel representing the Company addressed
to such Holder, confirming such effectiveness and, to the knowledge of such counsel,
the absence of any stop order.
	 
	 	(c)	 	Each Holder agrees to furnish to the Company a completed Questionnaire in the
form attached to this Schedule as Annex B (a “Selling Holder Questionnaire”) no later
than the Closing Date. The Company shall not be required to include the Registrable
Securities of a Holder in the Registration Statement who fails to furnish to the
Company a fully completed Selling Holder Questionnaire by the later of (i) the Closing
Date or (ii) at least five Trading Days prior to the date of filing of the Registration
Statement or pre-effective amendment to the Registration Statement (in no event is the
Company required to delay filing the Registration Statement or any pre-effective
amendment thereto). Each Holder also agrees to provide the Company with such other
information as may be reasonably requested by the Company in connection with the
preparation and filing of any

F-2

 

	 	 	 	Registration Statement hereunder, including but not limited to providing such
information in a timely manner regarding itself, the Registrable Securities and
other securities of the Company held by it and the intended method of disposition of
the Registrable Securities as shall be reasonably required to effect and maintain
the effectiveness of the registration of such Registrable Securities. The Company
shall not be required to include the Registrable Securities of a Holder who fails to
provide such reasonably requested information or who objects to the inclusion of
required disclosure in the Registration Statement regarding such Holder, the
Registrable Securities and other securities of the Company held by it and the
intended method of disposition of the Registrable Securities.
	 
	 	(d)	 	Notwithstanding Section 2(a) hereof, the Company may delay or suspend the
effectiveness of the Registration Statement (a “Delay Period”) if the board of
directors of the Company determines in good faith that effectiveness of the
Registration Statement should be suspended in accordance with the rules and regulations
under the Securities Act or that the disclosure of material non-public information
(“Pending Developments”) at such time would be detrimental to the Company and its
subsidiaries, taken as a whole; provided that if a Delay Period occurs or if, for any
other reason, after effectiveness the Registration Statement is not available to enable
Holders to effect resales thereunder, the term of any Delay Period(s) and period(s)
during which the Registration Statement is otherwise unavailable for use in effecting
such resales, the period during which the Registration Statement shall be required to
remain effective specified in clause (i) of Section 2(a) of this Schedule “F” shall be
extended by the aggregate of the term(s) of any Delay Period(s) or other period(s)
during which the Registration Statement may not be used by Holders to effect resales
thereunder. Notwithstanding the foregoing, in no event will a Delay Period be in effect
or the ability of the holders of the Securities, or the common shares underlying these
securities to effect resales under such registration statement be impaired during any
period in which the Company is effecting a primary public offering of its securities in
the United States or Canada so that holders of the Securities, and the common shares
underlying these securities, shall have the ability to effect public resales of their
securities at the same time and on the same basis as purchasers in any such primary
public offering.
	 
	 	 	 	The aggregate Delay Period for all Pending Developments shall not exceed 45 calendar
days in any 180-day period. Notwithstanding the foregoing, the Company shall use
its commercially reasonable efforts to ensure that the Registration Statement is
declared effective and its permitted use is resumed following a suspension as
promptly as practicable. The Company shall not be required to specify in the
written notice to the Holders the nature of the event giving rise to the Delay
Period. The notice of the existence of a Pending Development shall remain
confidential to such Holder until such information otherwise becomes public, unless
disclosure by the Holder is required by law and provided that notwithstanding such
Holder’s agreement to keep such information confidential, each such Holder makes no
acknowledgment that any such information is material, non-public information.
	 
	 	(e)	 	In the event that the Registration Statement is not declared effective, for
whatever reason, by the time period stipulated in Section 2(a) of this Schedule “F” or
the Registration Statement ceases to be effective at a time that it is required to
remain effective hereunder and such failure to be effective exceeds 45 calendar days in
any 180 day period set forth in Section 2(d), then the Company shall issue forthwith,
to Investors (and to any subsequent holder on transmission by death but not subsequent
assignees unless specifically approved in advance by the Company) 0.10 of a Share
(adjusted for any stock split, dividend or other distribution, recapitalization or
other similar event and where the total number of Shares to be issued shall be rounded
down to the nearest whole number of Shares, with no cash payment being made for the
fractional Share) (the “Penalty Shares”) for each Share underlying the Subscription
Receipts which remains subject to resale restrictions in the United States and the
obligations to obtain and maintain an effective Registration Statement hereunder shall
remain binding on the Company.

Section 3. Registration Procedures.

F-3

 

	 	 	 	In connection with the Company’s registration obligations hereunder, the Company shall:
	 
	 	(a)	 	Not less than five Trading Days prior to the filing of the Registration
Statement or any related Prospectus or any amendment or supplement thereto, the Company
shall (i) furnish to each Holder copies of all such documents proposed to be filed,
which documents (other than those incorporated or deemed to be incorporated by
reference) will be subject to the review of such Holders, and (ii) cause its officers
and directors, counsel and independent certified public accountants to respond to such
inquiries as shall be necessary, in the reasonable opinion of respective counsel to
each Holder, to conduct a reasonable investigation within the meaning of the Securities
Act. The Company shall not file a Registration Statement or any Prospectus or any
amendments or supplements thereto to which a majority of the Holders of Registrable
Securities object in good faith, provided that the Company is notified of such
objection in writing no later than five Trading Days after the Holders have been so
furnished copies of a Registration Statement or any Prospectus or amendments or
supplements thereto. The Company and the Holders agree to act in good faith to resolve
such objections of the Holders.
	 
	 	(b)	 	(i) Prepare and file with reasonable promptness with the Commission such
amendments, including post effective amendments, to the Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep the Registration
Statement continuously effective as to the Registrable Securities for the Effectiveness
Period; (ii) cause the Prospectus to be amended or supplemented by any required
Prospectus supplement, and as so supplemented or amended to be filed pursuant to Rule
424; (iii) respond as promptly as reasonably possible to any comments received from the
Commission with respect to the Registration Statement or any amendment thereto; and
(iv) comply in all material respects with the provisions of the Securities Act and the
Exchange Act with respect to the Registration Statement and the disposition of all
Registrable Securities covered by the Registration Statement.
	 
	 	(c)	 	Notify the Holders as promptly as reasonably possible (and, in the case of
(i)(A) and (iv) below, not less than three Trading Days prior to such filing and, in
the case of (v) below, not less than three Trading Days prior to the financial
statements in any Registration Statement becoming ineligible for inclusion therein) and
(if requested by any such Person) confirm such notice in writing no later than one
Trading Day following the day (i)(A) when a Prospectus or any Prospectus supplement or
post effective amendment to the Registration Statement is proposed to be filed; (B)
when the Commission notifies the Company whether there will be a “review” of the
Registration Statement and whenever the Commission comments in writing on the
Registration Statement (the Company shall provide true and complete copies thereof and
all written responses thereto to each of the Holders that pertain to the Holders as a
Selling Stockholder or to the Plan of Distribution, but not information which the
Company believes would constitute material and non-public information); and (C) with
respect to the Registration Statement or any post effective amendment, when the same
has become effective; (ii) of any request by the Commission or any other Federal or
state governmental authority for amendments or supplements to the Registration
Statement or Prospectus or for additional information; (iii) of the issuance by the
Commission or any other Federal or state governmental authority of any stop order
suspending the effectiveness of the Registration Statement covering any or all of the
Registrable Securities or the initiation of any Proceedings for that purpose; (iv) of
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; and (v) of the occurrence of any event or passage of time that makes the
financial statements included in the Registration Statement ineligible for inclusion
therein or any statement made in the Registration Statement or Prospectus or any
document incorporated or deemed to be incorporated therein by reference untrue in any
material respect or that requires any revisions to the Registration Statement,
Prospectus or other documents so that, in the case of the Registration Statement or the
Prospectus, as the case may be, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were made,
not misleading, and (vi) the occurrence of a Delay Period.

F-4

 

	 	(d)	 	Use its commercially reasonable efforts to avoid the issuance of, or, if
issued, obtain the withdrawal of (i) any order suspending the effectiveness of the
Registration Statement, or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any jurisdiction, at
the earliest practicable moment.
	 
	 	(e)	 	Furnish to each Holder, without charge, at least one conformed copy of the
Registration Statement and each amendment thereto and all exhibits to the extent
requested by such Person (including those previously furnished) promptly after the
filing of such documents with the Commission.
	 
	 	(f)	 	Promptly deliver to each Holder, without charge, copies of each Prospectus or
Prospectuses and each amendment or supplement thereto as such Persons may reasonably
request. The Company hereby consents to the use of such Prospectus and each amendment
or supplement thereto by each of the selling Holders in connection with the offering
and sale of the Registrable Securities covered by such Prospectus and any amendment or
supplement thereto.
	 
	 	(g)	 	The Company shall, at its own expense, cooperate with the Agents and U.S.
broker-dealers who, in connection with any resale, may reasonably be considered to be
acting as underwriters, with respect to any filing made by any of them with the
Financial Industry Regulatory Authority Inc. (“FINRA”) Corporate Financing Department
pursuant to FINRA Rule 5110(b)(i) so as to permit such filing and any amendments
thereto to be made on a timely basis, if required.
	 
	 	(h)	 	Cooperate with the Holders to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be delivered to a transferee
pursuant to the Registration Statement, which certificates shall be free, to the extent
permitted by the Subscription Agreement, of all restrictive legends, and to enable such
Registrable Securities to be in such denominations and registered in such names as any
such Holders may request.
	 
	 	(i)	 	Upon the occurrence of any event contemplated by Section 3(c)(v), use its
commercially reasonable efforts to ensure that the use of the Registration Statement or
Prospectus may be resumed as promptly as practicable and shall promptly prepare a
supplement or amendment, including a post effective amendment, to the Registration
Statement or a supplement to the related Prospectus or any document incorporated or
deemed to be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, no Registration Statement nor any Prospectus will
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. The Company shall be
entitled to exercise its right under this section 3(i) to suspend the availability of a
Registration Statement or Prospectus for an aggregate period, including any Delay
Period, not to exceed 45 calendar days in any 180-day period. Notwithstanding the
foregoing, in no event will such a suspension be in effect during any period in which
the Company is effecting a primary public offering of its securities in the United
States or Canada, so that holders of the Securities and the common shares underlying
these securities shall have the ability to effect public resales of their securities at
the same time and on the same basis as purchasers in any such primary public offering.
	 
	 	(j)	 	Comply with all applicable rules and regulations of the Commission.
	 
	 	 	 	Section 4. Obligations of Each Holder. In connection with the registration
of Registrable Securities pursuant to the Registration Statement, each Holder shall:
	 
	 	(a)	 	in the event of an underwritten offering of such Registrable Securities in
which such Holder participates, enter into a customary and reasonable underwriting
agreement and execute such other documents as the Company and the managing underwriter
for such offering may reasonably request; and
	 
	 	(b)	 	notify the Company when it has sold all of the Registrable Securities held by
it.

F-5

 

	 	 	 	Section 5. Registration Expenses. All fees and expenses incident to the
performance of or compliance with this Schedule by the Company shall be borne by the
Company whether or not any Registrable Securities are sold pursuant to the
Registration Statement. The fees and expenses referred to in the foregoing sentence
shall include, without limitation, (i) all registration and filing fees (including,
without limitation, fees and expenses of the Company’s counsel and auditors, and
other reasonable counsel fees and expenses, and including, without limitation, fees
and expenses (A) with respect to filings made with the Commission, (B) with respect
to filings required to be made with any trading market or exchange on which the
Common Stock is then listed for trading, (C) with respect to filing fees of FINRA
pursuant to FINRA Rule 5110, and (D) with respect to fees relating to compliance
with applicable state securities or Blue Sky laws in connection with Blue Sky
qualifications or exemptions of the Registrable Securities), (ii) messenger,
telephone and delivery expenses, (iii) fees and disbursements of counsel for the
Company, (iv) Securities Act liability insurance, if the Company so desires such
insurance, and (v) fees and expenses of all other Persons retained by the Company in
connection with the consummation of the transactions contemplated by this Schedule.
In addition, the Company shall be responsible for all of its internal expenses
incurred in connection with the consummation of the transactions contemplated by
this Schedule (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of any
annual audit and the fees and expenses incurred in connection with the listing of
the Registrable Securities on any securities exchange as required hereunder.
	 
	 	 	 	Section 6. Indemnification.
	 
	 	(a)	 	Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement or Schedule, indemnify and hold harmless each Holder, the
officers, directors, agents, investment advisors, brokers (including brokers who offer
to sell Registrable Securities as principal as a result of a pledge or any failure to
perform under a margin call effected on a Holder), partners, members and employees of
each of them (and any other persons with a functionally equivalent role of a person
holding such titles or performing such functions, notwithstanding a lack of such title
or any other title), each Person who controls any such Holder (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) and the officers,
directors, agents and employees of each such controlling Person, to the fullest extent
permitted by applicable law, from and against any and all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable costs of preparation and
reasonable attorneys’ fees) and expenses (collectively, “Losses”), as incurred, arising
out of or relating (1) to any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, any Prospectus or any form of prospectus or in
any amendment or supplement thereto or in any preliminary prospectus, or arising out of
or relating to any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein (in the case of any
Prospectus or form of prospectus or supplement thereto, in light of the circumstances
under which they were made) not misleading, and (2) any violation or alleged violation
by the Company of the Securities Act, the Exchange Act or any state securities law, or
any rule or regulation thereunder, in connection with the performance of its
obligations under this Agreement and Schedule, except to the extent, but only to the
extent, that (1) such untrue statements or omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder expressly for
use therein, or to the extent that such information relates to such Holder or such
Holder’s proposed method of distribution of Registrable Securities and was reviewed and
expressly approved in writing by such Holder expressly for use in the Registration
Statement, such Prospectus or such form of Prospectus or in any amendment or supplement
thereto (it being understood that the Holder has approved Annex A hereto for this
purpose) or (2) in the case of an occurrence of an event of the type specified in
Section 3(c)(ii)-(vi), the use by such Holder of an outdated or defective Prospectus
after the Company has notified such Holder in writing that the Prospectus is outdated
or defective and prior to the receipt by such Holder of an Advice or an amended or
supplemented Prospectus, but only if and to the extent that following the receipt of
the Advice or the amended or supplemented Prospectus the misstatement or omission
giving rise to such Loss would have been corrected. The Company shall notify the
Holders promptly in writing of the
institution, threat or assertion of any Proceeding of which the Company is aware in
connection with the transactions contemplated by this Schedule.

F-6

 

	 	(b)	 	Indemnification by Holders. Each Holder shall, severally and not
jointly, indemnify and hold harmless the Company, its directors, officers, agents and
employees, each Person who controls the Company (within the meaning of Section 15 of
the Securities Act and Section 20 of the Exchange Act), and the directors, officers,
agents or employees of such controlling Persons, to the fullest extent permitted by
applicable law, from and against all Losses, as incurred, arising solely out of or
based solely upon: (x) such Holder’s failure to comply with the prospectus delivery
requirements of the Securities Act or (y) any untrue statement of a material fact
contained in the Registration Statement, the Prospectus, or any form of prospectus, or
in any amendment or supplement thereto, or arising solely out of or based solely upon
any omission of a material fact required to be stated therein or necessary to make the
statements therein not misleading to the extent, but only to the extent that, (1) such
untrue statements or omissions are based solely upon information regarding such Holder
furnished in writing to the Company by such Holder expressly for use therein, or to the
extent that such information relates to such Holder or such Holder’s proposed method of
distribution of Registrable Securities and was reviewed and expressly approved in
writing by such Holder expressly for use in the Registration Statement (it being
understood that the Holder has approved Annex A hereto for this purpose), such
Prospectus or such form of Prospectus or in any amendment or supplement thereto or (2)
in the case of an occurrence of an event of the type specified in Section
3(c)(ii)-(vi), the use by such Holder of an outdated or defective Prospectus after the
Company has notified such Holder in writing that the Prospectus is outdated or
defective and prior to the receipt by such Holder of an Advice or an amended or
supplemented Prospectus, but only if and to the extent that following the receipt of
the Advice or the amended or supplemented Prospectus the misstatement or omission
giving rise to such Loss would have been corrected. In no event shall the liability of
any selling Holder hereunder be greater in amount than the dollar amount of the net
proceeds received by such Holder upon the sale of the Registrable Securities giving
rise to such indemnification obligation.
	 
	 	(c)	 	Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified
Party”), such Indemnified Party shall promptly notify the Person from whom indemnity is
sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall assume
the defense thereof, including the employment of counsel reasonably satisfactory to the
Indemnified Party and the payment of all fees and expenses incurred in connection with
defense thereof; provided, that the failure of any Indemnified Party to give such
notice shall not relieve the Indemnifying Party of its obligations or liabilities
pursuant to this Agreement and Schedule, except (and only) to the extent that it shall
be finally determined by a court of competent jurisdiction (which determination is not
subject to appeal or further review) that such failure shall have proximately and
materially adversely prejudiced the Indemnifying Party.
	 
	 	 	 	An Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Party or Parties unless:
(1) the Indemnifying Party has agreed in writing to pay such fees and expenses; (2)
the Indemnifying Party shall have failed promptly to assume the defense of such
Proceeding and to employ counsel reasonably satisfactory to such Indemnified Party
in any such Proceeding; or (3) the named parties to any such Proceeding (including
any impleaded parties) include both such Indemnified Party and the Indemnifying
Party, and such Indemnified Party shall have been advised by counsel to the
Indemnified Party that a conflict of interest is likely to exist if the same counsel
were to represent such Indemnified Party and the Indemnifying Party (in which case,
if such Indemnified Party notifies the Indemnifying Party in writing that it elects
to employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense thereof and such
counsel shall be at the expense of the Indemnifying Party). The Indemnifying Party
shall not be liable for any settlement of any such Proceeding effected without its
written consent, which consent shall not be unreasonably withheld or delayed. No
Indemnifying Party shall, without the
prior written consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified Party from all
liability on claims that are the subject matter of such Proceeding.

F-7

 

	 	 	 	All fees and expenses of the Indemnified Party (including reasonable fees and
expenses to the extent incurred in connection with investigating or preparing to
defend such Proceeding in a manner not inconsistent with this Section) shall be paid
to the Indemnified Party, as incurred, within ten Trading Days of written notice
thereof to the Indemnifying Party (regardless of whether it is ultimately determined
that an Indemnified Party is not entitled to indemnification hereunder; provided,
that the Indemnifying Party may require such Indemnified Party to undertake to
reimburse all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to indemnification
hereunder).
	 
	 	(d)	 	Contribution. If a claim for indemnification under Section 6(a) or
6(b) of this Schedule “F” is unavailable to an Indemnified Party or insufficient to
hold an Indemnified Party harmless for any Losses (by reason of public policy or
otherwise), then each Indemnifying Party shall contribute to the amount paid or payable
by such Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and Indemnified
Party in connection with the actions, statements or omissions that resulted in such
Losses as well as any other relevant equitable considerations. The relative fault of
such Indemnifying Party and Indemnified Party shall be determined by reference to,
among other things, whether any action in question, including any untrue or alleged
untrue statement of a material fact or omission or alleged omission of a material fact,
has been taken or made by, or relates to information supplied by, such Indemnifying
Party or Indemnified Party, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such action, statement or omission.
The amount paid or payable by a party as a result of any Losses shall be deemed to
include, subject to the limitations set forth in Section 6(c), any reasonable
attorneys’ or other reasonable fees or expenses incurred by such party in connection
with any Proceeding to the extent such party would have been indemnified for such fees
or expenses if the indemnification provided for in this Section was available to such
party in accordance with its terms.
	 
	 	 	 	The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 6(d) were determined by pro rata allocation or by any other
method of allocation that does not take into account the equitable considerations
referred to in the immediately preceding paragraph. Notwithstanding the provisions
of this Section 6(d), no Holder shall be required to contribute, in the aggregate,
any amount in excess of the amount by which the proceeds actually received by such
Holder from the sale of the Registrable Securities subject to the Proceeding exceeds
the amount of any damages that such Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged omission.
	 
	 	 	 	The indemnity and contribution agreements contained in this Section are in addition
to any liability that the Indemnifying Parties may have to the Indemnified Parties.
	 
	 	 	 	Section 7. Miscellaneous.
	 
	 	(a)	 	Compliance. Each Holder covenants and agrees that it will comply with
the prospectus delivery requirements of the Securities Act as applicable to it in
connection with sales of Registrable Securities pursuant to the Registration Statement.
	 
	 	(b)	 	Discontinued Disposition. Each Holder agrees by its acquisition of
such Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(c)(iii) through (vi), such
Holder will forthwith discontinue disposition of such Registrable Securities under the
Registration Statement until such Holder’s receipt of the copies of the supplemented
Prospectus and/or amended Registration Statement or until it is advised in writing (the
“Advice”) by the Company that the use of the applicable Prospectus may

F-8

 

	 	 	 	be resumed, and, in either case, has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by reference
in such Prospectus or Registration Statement. The Company may provide appropriate
stop transfer orders to enforce the provisions of this paragraph. The Company will
use its commercially reasonable efforts to ensure that the use of the prospectus may
be resumed as promptly as is practicable. The Company agrees and acknowledges that
any periods during which the Holder is required to discontinue the disposition of
Registrable Securities pursuant to Section 3(c)(v) and (vi) hereunder shall be
subject to the limitations set forth in the last sentence of Section 3(h).
	 
	 	(c)	 	Delay of Registration. No Holder shall have any right to obtain or
seek an injunction restraining or otherwise delaying any such registration as the
result of any controversy that might arise with respect to the interpretation or
implementation of this Schedule.
	 
	 	(d)	 	Amendments and Waivers. The provisions of this Schedule, including the
provisions of this Section 7(d), may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given, unless
the same shall be in writing and signed by the Company and the Holders of no less than
a majority in interest of the Registrable Securities (treated together as a single
class). Notwithstanding the foregoing, a waiver or consent to depart from the
provisions hereof with respect to a matter that relates exclusively to the rights of
certain Holders and that does not directly or indirectly affect the rights of other
Holders may be given by Holders of at least a majority of the Registrable Securities to
which such waiver or consent relates.
	 
	 	(e)	 	Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be provided in accordance with the
terms of the Subscription Agreement to which this Schedule is attached; provided
however, that all written notices or copies of documents required to be provided
pursuant to this Schedule may be electronic copies transmitted electronically to the
Holder’s email address as set forth on the Selling Shareholder Questionnaire, or at set
other email address as provided to the Company by the Holder.
	 
	 	(f)	 	Successors and Assigns. The Company may not assign its rights or
obligations hereunder without the prior written consent of each Holder. Subject to the
limitations on the ability to assign the right to receive Penalty Shares set forth in
section 2(e) of this Schedule “F”, the rights under this Schedule shall be
automatically assignable by the Investors to any transferee of 1,000 (one thousand)
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) the
transfer of assignment is completed prior to the effectiveness of the Registration
Statement or immediately following such transfer or assignment if the further
disposition of the securities is restricted under the Securities Act and 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 Subscription Agreement.
	 
	 	(g)	 	Severability. If any term, provision, covenant or restriction of this
Schedule is held by a court of competent jurisdiction to be invalid, illegal, void or
unenforceable, the remainder of the terms, provisions, covenants and restrictions set
forth herein shall remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their commercially reasonable
efforts to find and employ an alternative means to achieve the same or substantially
the same result as that contemplated by such term, provision, covenant or restriction.
It is hereby stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.

F-9

 

	 	(h)	 	Headings. The headings in this Schedule are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
	 
	 	(i)	 	Independent Nature of Holders’ Obligations and Rights.  The obligations
of each Holder under this Schedule are several and not joint with the obligations of
each other Holder, and no Holder shall be responsible in any way for the performance of
the obligations of any other Holder under this Schedule. Nothing contained herein or
in any other agreement or document delivered at any closing, and no action taken by any
Holder pursuant thereto, shall be deemed to constitute the Holders as a partnership, an
association, a joint venture or any other kind of entity, or create a presumption that
the Holders are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by this Schedule. Each Holder
acknowledges that no other Holder will be acting as agent of such Holder in enforcing
its rights under this Schedule. Each Holder shall be entitled to independently protect
and enforce its rights, including without limitation the rights arising out of this
Schedule, and it shall not be necessary for any other Holder to be joined as an
additional party in any Proceeding for such purpose. The Company acknowledges that
each of the Holders has been provided with the same Schedule for the purpose of closing
a transaction with multiple Holders and not because it was required or requested to do
so by any Holder.

F-10

 

ANNEX A

Plan of Distribution

     We are registering the shares of common stock to permit the resale of these shares of common
stock by the holders of the common stock 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. We will bear all fees and expenses incident to our obligation to register 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 Nasdaq, the Toronto Stock Exchange or any other 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;
	 
	 	•	 	sales pursuant to Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), if
available, rather than under this prospectus;
	 
	 	•	 	broker-dealers may agree with the selling securityholders 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.

     Broker dealers engaged by the selling stockholders may arrange for other brokers dealers to
participate in sales. Broker dealers may receive commissions or discounts from the selling
stockholders (or, if any broker dealer acts as agent for the purchaser of shares, from the
purchaser) in amounts to be negotiated, but, except as set forth in a supplement to this
Prospectus, in the case of an agency transaction not in excess of a customary brokerage commission
in compliance with NASD Rule 2440; and in the case of a principal transaction a markup or markdown
in compliance with NASD IM-2440. 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

F-11

 

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. However, we have advised each selling stockholder
that it may not use shares registered under this Registration Statement to cover short sales of
shares of common stock, or similar transactions, made prior to the date on which this Registration
Statement shall have been declared effective by the Securities and Exchange Commission.

     The selling stockholders may pledge or grant a security interest in some or all of the shares
of common stock 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 applicable provisions of the
Securities Act , 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.

     Because selling stockholders may be deemed to be “underwriters” within the meaning of the
Securities Act, they will be subject to the prospectus delivery requirements of the Securities Act.
In addition, any securities covered by this prospectus which qualify for sale pursuant to Rule 144
under the Securities Act may be sold under Rule 144 rather than under this prospectus. Each
selling stockholder has advised us that they have not entered into any written or oral agreements,
understandings or arrangements with any underwriter or broker-dealer regarding the sale of the
shares of common stock. There is no underwriter or coordinating broker acting in connection with
the proposed sale of the Common Stock by the Selling Stockholders.

     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 this 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, 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. 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 agreement, 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 agreement, or we may
be entitled to contribution.

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

F-12

 

ANNEX B

SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE

     The undersigned beneficial owner of common stock (the “Registrable Securities”) of Swisher
Hygiene Inc., a Delaware corporation (the “Company”), understands that the Company has filed or
intends to file with the Securities and Exchange Commission (the “Commission”) a registration
statement (the “Registration Statement”) for the registration and resale under Rule 415 of the
Securities Act of 1933, as amended (the “Securities Act”), of the Registrable Securities, in
accordance with the terms of the Registration Rights (the “Registration Rights Agreement”) to which
this document is annexed. All capitalized terms not otherwise defined herein shall have the
meanings ascribed thereto in the Registration Rights Agreement.

     Certain legal consequences arise from being named as a selling securityholder in the
Registration Statement and the related prospectus. Accordingly, holders and beneficial owners of
Registrable Securities are advised to consult their own securities law counsel regarding the
consequences of being named or not being named as a selling securityholder in the Registration
Statement and the related prospectus.

     IF NOT DELIVERED TO THE AGENTS PRIOR TO CLOSING OF THE OFFERING, PLEASE FAX OR EMAIL A COPY OF
THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO:

Akerman Senterfitt

350 East Las Olas Boulevard, Suite 1600

Fort Lauderdale, Florida

33301-2229

Attention:     Edward Ristaino

Facsimile:     (954) 463-2224

NOTICE

     The undersigned beneficial owner (the “Selling Securityholder”) of Registrable Securities
hereby elects to include the Registrable Securities owned by it in the Registration Statement.

F-13

 

     The undersigned hereby provides the following information to the Company and represents and
warrants that such information is accurate:

QUESTIONNAIRE

	 	 	 	 	 
	1.	 	NAME.
	 
	 	 	 	 
	 

	 	(a)
	 	Full Legal Name of Selling Securityholder
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	(b)
	 	Full Legal Name of Registered Holder (if not the same as (a) above) through
which Registrable Securities are held:
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 

	 	(c)
	 	Full Legal Name of Natural Control Person (which means a natural person who
directly or indirectly alone or with others has power to vote or dispose of the
securities covered by the questionnaire — ENTITIES MUST COMPLETE THIS QUESTION):
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	2.	 	ADDRESS FOR NOTICES TO SELLING SECURITYHOLDER:
	 
	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

			
	Telephone:	 	
  

			
	Fax:	 	
  

			
	Email:	 	
  

			
	Contact Person:	 	
  

	 	 	 	 	 
	3.	 	BROKER-DEALER STATUS:
	 
	 	 	 	 
	 

	 	(a)
	 	Are you a broker-dealer?
	 
	 	 	 	 
	 

	 	 	 	          Yes ___ No ___
	 
	 	 	 	 
	 

	 	(b)
	 	If “yes” to Section 3(a), did you receive your Registrable Securities as
compensation for investment banking services to the Company.
	 
	 	 	 	 
	 

	 	 	 	          Yes ___ No ___
	 
	 	 	 	 
	 	 	Note: If no, the Commission’s staff has indicated that you should be identified as
an underwriter in the Registration Statement.
	 
	 	 	 	 
	 

	 	(c)
	 	Are you an affiliate of a broker-dealer?
	 
	 	 	 	 
	 

	 	 	 	          Yes ___ No ___
	 
	 	 	 	 
	 

	 	(d)
	 	If you are an affiliate of a broker-dealer. do you certify that you bought the
Registrable Securities in the ordinary course of business, and at the time of the
purchase of the Registrable Securities to

F-14

 

	 	 	 	 	 
	 

	 	 	 	be resold, you had no agreements or understandings, directly or indirectly, with any
person to distribute the Registrable Securities?
	 
	 	 	 	 
	 

	 	 	 	          Yes ___ No ___
	 
	 	 	 	 
	 	 	Note: If no, the Commission’s staff has indicated that you should be identified as
an underwriter in the Registration Statement.
	 
	 	 	 	 
	4.	 	BENEFICIAL OWNERSHIP OF SECURITIES OF THE COMPANY OWNED BY THE SELLING SECURITYHOLDER.
	 
	 	 	 	 
	 	 	Except as set forth below in this Item 4, the undersigned is not the beneficial or
registered owner of any securities of the Company other than the securities issuable
pursuant to the Subscription Agreement.
	 
	 	 	 	 
	 

	 	(a)
	 	Type and Amount of other securities beneficially owned by the Selling
Securityholder:
	 
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 
	 

	 	 	 	 
	 
	 	 	 	 
	5.	 	RELATIONSHIPS WITH THE COMPANY:
	 
	 	 	 	 
	 	 	Except as set forth below, neither the undersigned nor any of its affiliates, officers,
directors or principal equity holders (owners of 5% of more of the equity securities of
the undersigned) has held any position or office or has had any other material
relationship with the Company (or its predecessors or affiliates) during the past three
years.
	 
	 	 	 	 
	 	 	State any exceptions here:
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 
	 	 	 

     The undersigned agrees to promptly notify the Company of any inaccuracies or changes in the
information provided herein that may occur subsequent to the date hereof at any time while the
Registration Statement remains effective.

     By signing below, the undersigned consents to the disclosure of the information contained
herein in its answers to Items 1 through 5 and the inclusion of such information in the
Registration Statement and the related prospectus and any amendments or supplements thereto. The
undersigned understands that such information will be relied upon by the Company in connection with
the preparation or amendment of the Registration Statement and the related prospectus.

     IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Notice and
Questionnaire to be executed and delivered either in person or by its duly authorized agent.

			
	Dated:	 	
  

			
	Beneficial Owner:	 	
  

			
	By:	 	
  

			
	Name:	 	
  

			
	Title:	 	
  

F-15

 

SCHEDULE “G”

CURRENT 34 ACT FILINGS

Swisher Hygiene Inc.

	a)	 	Registration Statement on Form 10, filed with the SEC on November 9, 2010, as amended
on Form 10-A, filed with the SEC on December 15, 2010, January 11, 2011 and January 31,
2011;
	 
	b)	 	Current Reports on Form 8-K, filed with the SEC on January 12, 2011, January 31, 2011,
and February 11, 2011; and
	 
	c)	 	Registration Statement on Form 8-A, filed with the SEC on February 1, 2011.

G-1

 

SCHEDULE “B”

OPINION OF COMPANY’ COUNSEL

	1.	 	the incorporation of the Company and its Material Subsidiaries and that each of the Company
and its Material Subsidiaries has not been dissolved;
	 
	2.	 	the qualification of the Company and each of its Material Subsidiaries to carry on its
business under the laws of each jurisdiction in which it carries on its business;
	 
	3.	 	the corporate power of each of the Company and Material Subsidiaries to own its property and
carry on its business;
	 
	4.	 	the authorized and issued capital of the Company;
	 
	5.	 	based solely on a review of the shareholders’ register of the Material Subsidiaries, the
Company is the sole registered holder of all of its outstanding shares in the capital of each
Material Subsidiary;
	 
	6.	 	the due authorization and issuance of the Subscription Receipts and the due authorization and
reservation for issuance of the Underlying Common Shares and Penalty Shares and that upon
issuance with the applicable instrument the Underlying Common Shares and the Penalty Shares
will be fully paid and non-assessable;
	 
	7.	 	the approval of the listing of the Underlying Common Shares and Penalty Shares on the Toronto
Stock Exchange and the Nasdaq Global Market subject to filing of required documentation and
payment of fees within applicable time periods;
	 
	8.	 	the authorization, execution, delivery, binding effect and enforceability of this Agreement,
the Subscription Receipt Agreement, the Subscription Receipt Certificates and the Subscription
Agreements by, on and against the Company, subject to bankruptcy laws, the availability of
equitable remedies and except with respect to rights to indemnity, contribution and waiver of
contribution which may be subject to applicable laws;
	 
	9.	 	the appointment of Subscription Receipt Agent at its office in the Toronto as transfer agent
and registrar for the Common Shares;
	 
	10.	 	the form of certificate representing the Common Shares has been duly approved by the Company
and complies with the laws of the Company’s jurisdiction of incorporation, the constating
documents of the Company and the requirements of the Toronto Stock Exchange and the Nasdaq
Global Market;
	 
	11.	 	this Agreement and the issuance and sale of the Subscription Receipts, Underlying Common
Shares and Penalty Shares not conflicting with or resulting in a breach of or a default under,
in any material respect, (i) any of the terms, conditions or provisions of the constating
documents of the Company, (ii) any of the resolutions of the directors or

B-1

 

	 	 	shareholders of the Company, (iii) the provisions of any U.S. federal statute, Canadian
statute, rule or regulation to which the Company is subject or the Delaware General
Corporation Law;
	 
	12.	 	the Company is a reporting issuer not in default under the Securities Laws of each of the
Provinces of Canada, and is not in default of its reporting obligations arising as a reporting
company under the 1934 Act and the Company will cease to be an entity that is an issuer
described in paragraph (i)(l)(i) of the Rule 144 under the 1933 Act on November 10, 2011;
	 
	13.	 	the offering, sale and issuance of the Subscription Receipts, Underlying Common Shares and
Penalty Shares in accordance with the terms of this Agreement are exempt from the prospectus
requirements of the Canadian Securities Laws, and the only filing, proceeding, approval,
permit, consent or authorization required to be made, taken or obtained under the Securities
Laws is the filing with the applicable provincial securities regulatory authority within the
prescribed time periods, of a report in Form 45-106FI (as prescribed by National Instrument
45-106 of the Canadian Securities Administrators) prepared and executed in accordance with
applicable Securities Laws, together with the requisite filing fees;
	 
	14.	 	The first trade, if any, by Subscriber, of the Subscription Receipts, other than a trade
which is otherwise exempt under the Securities Laws of the Canadian Selling Jurisdictions,
will be a distribution subject to the prospectus and registration requirements of the
Securities Laws of the Canadian Selling Jurisdictions unless:

	 	(a)	 	the Company is and has been a reporting issuer in one of the jurisdictions in
Canada for the four months immediately preceding the trade;
	 
	 	(b)	 	at least four months have elapsed form the Closing Date;
	 
	 	(c)	 	the certificates representing the Subscription Receipts bear a legend in the
form prescribed by NI 45-102;
	 
	 	(d)	 	the first trade is not a “control distribution” (within the meaning of NI
45-102);
	 
	 	(e)	 	no unusual effort is made to prepare the market or to create a demand for the
security that is subject of the trade;
	 
	 	(f)	 	no extraordinary commission or consideration is paid to a person in respect of
the trade;
	 
	 	(g)	 	if the Subscriber is an insider or officer of the Company, such Subscriber has
no reasonable grounds to believe the Company is in default of securities legislation
(as such term is defined in National Instrument 14-101 — Definitions).

	15.	 	The offer and sale of the Subscription Receipts, Underlying Common Shares and Penalty Shares
to the Subscribers in the manner described in the Agency Agreement and

B-2

 

	 	 	Subscription Agreements are exempt from the registration provisions of the U.S. Securities
Act.

	16.	 	The Company is not an “investment company” (as defined in the Investment Company Act of 1940)
that is required to be registered under such Act.

B-3

 

SCHEDULE “C”

U.S. TERMS AND CONDITIONS

This is Schedule “C” to the Agency Agreement among Clarus Securities Inc., Broadband Capital
Management LLC. and TD Securities Inc. (collectively, the “Agents”) and Swisher Hygiene Inc. (the
“Company”) made as of February 23, 2011.

As used in this schedule, the following terms shall have the meanings indicated:

	 	 	 

	Accredited Investor

	 	means an “accredited investor” as defined in Rule 501(a) of
Regulation D;
	 
	 	 
	General 

Solicitation or 

General Advertising

	 	means general solicitation or general advertising (as those
terms are used in Regulation D), including advertisements,
articles, notices or other communications published in any
newspaper, magazine, or similar media or broadcast over radio
or television, or any seminar or meeting whose attendees had
been invited by general solicitation or general advertising,
or any other manner of conduct involving a public offering in
the United States within the meaning of Section 4(2) of the
U.S. Securities Act;
	 
	 	 
	Regulation D

	 	means Regulation D under the U.S. Securities Act;
	 
	 	 
	Regulation S

	 	means Regulation S under the U.S. Securities Act;
	 
	 	 
	United States

	 	means the United States of America, its territories and
possessions, any state of the United States, and the District
of Columbia;
	 
	 	 
	U.S. Exchange Act

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

	 	means “U.S. person” as defined in Rule 902(k) of Regulation S;
	 
	 	 
	U.S. Securities Act

	 	means the United States Securities Act of 1933, as amended.

All other capitalized terms used but not otherwise defined in this Schedule “A” shall have the
meanings assigned to them in the Agency Agreement to which this Schedule “A” is attached.

Representations, Warranties and Covenants of the Agents

The Agents acknowledge that the Securities have not been and will not be registered under the U.S.
Securities Act or applicable state securities laws and may not be offered or sold, except in
accordance with an exemption or exclusion from the registration requirements of the U.S. Securities
Act and applicable state securities laws. Accordingly, the Agents, represent, warrant and covenant
to and with the Company that:

C-1

 

	1.	 	The Agents have offered and sold and will offer and sell the Subscription Receipts only as
provided in paragraphs 2 through 12 below.
	 
	2.	 	All offers and sales of Subscription Receipts to persons in the United States have been or
will be made by the Broadband in accordance with applicable U.S. federal and state
broker-dealer requirements.
	 
	3.	 	Broadband is duly registered as broker-dealers under section 15(b) of the U.S. Exchange Act
and are members of, and in good standing with, Financial Industry Regulatory Authority, Inc.
(formerly, the National Association of Securities Dealers, Inc.) on the date hereof and on the
date offers and sales were made in the United States.
	 
	4.	 	Any offer, sale or solicitation of an offer to buy the Subscription Receipts was or will be
made only to Accredited Investors in transactions that are exempt from registration pursuant
to Rule 506 of Regulation D under the U.S. Securities Act and available exemptions under all
applicable state securities laws and require no filings or actions except as otherwise agreed
by the Company.
	 
	5.	 	Immediately prior to any offer or sale of the Subscription Receipts, the Agents had a
pre-existing relationship with such offeree or purchaser and had or will have reasonable
grounds to believe and did or will believe that each such offeree or purchaser was an
Accredited Investor.
	 
	6.	 	None of the Agents or any of their affiliates or any person acting on its or their behalf has
used or will use any form of General Solicitation or General Advertising or has offered or
will offer to sell the Subscription Receipts in any manner involving a public offering in the
United States within the meaning of Section 4(2) of the U.S. Securities Act.
	 
	7.	 	They have not entered and will not enter into any contractual arrangement with respect to the
distribution of the Subscription Receipts except with its affiliates, any selling group
members or with the prior written consent of the Company. The Agents shall cause and each
affiliate or selling group member participating in the distribution of the Subscription
Receipts to agree, for the benefit of the Company, to the same provisions contained in this
Schedule “C” as apply to the Agents as if such provisions applied to such persons.
	 
	8.	 	All purchasers of Subscription Receipts shall be informed that the Securities have not been
and will not be registered under the U.S. Securities Act and the Subscription Receipts are
being offered and sold in reliance upon an exemption from the registration requirements of the
U.S. Securities Act provided by Rule 506 of Regulation D and/or Section 4(2) of the U.S.
Securities Act.
	 
	9.	 	Prior to completion of any sale of Subscription Receipts, each purchaser will be required to
complete and execute a subscription agreement in the form or forms consented to by the Company
and the Agents.
	 
	10.	 	At the Closing, the Agents will provide a certificate substantially in the form of Exhibit 1
to this Schedule, relating to the manner of the offer and sale of the Subscription Receipts.
	 
	11.	 	Neither the Agents, their respective affiliates nor any person acting on its or their behalf
has taken or will take, directly or indirectly, any action in violation of Regulation M under
the U.S. Exchange Act in connection with the offer and sale of the Subscription Receipts or
the Securities.
	 
	12.	 	The Agents agree that all certificates representing the Securities sold in the United States
as part of the Offering, and all certificates issued in exchange for or in substitution of the
foregoing

C-2

 

	 	 	Securities, will bear a legend provided for in the subscription agreement to be
completed and executed by each purchaser.

Representations, Warranties and Covenants of the Company

The Company represents, warrants, covenants and agrees to and with the Agents and the U.S.
Placement Agent that:

	1.	 	Neither the Company nor any of their affiliates, nor any person acting on their or its behalf
(except the Agents, their affiliates and any person acting on any of their behalf, as to which
no representation is made) has taken or will take, directly or indirectly, any action in
violation of Regulation M under the U.S. Exchange Act in connection with the offer and sale of
the Securities, or has taken or will take any action that would cause the exemption afforded
by Rule 506 of Regulation D or Section 4(2) of the U.S. Securities Act to be unavailable for
offers and sales of Subscription Receipts or Securities pursuant to the Agency Agreement or
for exercises or conversion of Subscription Receipts or Warrants.
	 
	2.	 	None of the Company, its affiliates or any person acting on its or their behalf (except the
Agents, their affiliates and any person acting on any of their behalf, as to which no
representation is made) has engaged or will engage in any form of General Solicitation or
General Advertising.
	 
	3.	 	Neither the Company nor any of its affiliates has offered or sold, for a period of six months
prior to commencement of the offering of the Subscription Receipts, and will not offer or
sell, any securities in a manner that would be integrated with the offer and sale of the
Subscription Receipts and would cause the exemption from registration set forth in Rule 506 of
Regulation D to become unavailable with respect to the offer and sale of the Securities.
	 
	4.	 	None of the Company or any of its affiliates or any person acting on its or their behalf has
offered or sold or will offer or sell any of the Subscription Receipts or the Shares sold
pursuant to the Offering except through the Agents or a U.S. Placement Agent in accordance
with this Schedule.

C-3

 

EXHIBIT 1

AGENTS’ CERTIFICATE

     In connection with the offering of the Securities of Swisher Hygiene Inc. (the “Corporation”)
pursuant to the Agency Agreement dated as of February 23, 2011 among the Corporation , and the
Agents named therein (the “Agency Agreement”), the undersigned hereby certifies, as follows:

	 	(A)	 	Broadband Capital Management LLC is a duly registered broker or
dealer with the United States Securities and Exchange Commission and is a
member of and is in good standing with the Financial Industry Regulatory
Authority Inc. on the date hereof and on the dates of such offers and sales;
	 
	 	(B)	 	all offers and sales of Securities in the United States, or to,
or for the account or benefit of, a U.S. Person, have been effected in
accordance with federal and state U.S. broker-dealer requirements in all
material respects;
	 
	 	(C)	 	immediately prior to contacting any offeree, we had reasonable
grounds to believe and did believe that each offeree was an “accredited
investor” as specified in Rule 501(a) of Regulation D (an “Accredited
Investor”) under the Securities Act of 1933, as amended (the “U.S. Securities
Act”) and, on the date hereof, we continue to believe that each person
purchasing Securities is an Accredited Investor;
	 
	 	(D)	 	no form of general solicitation or general advertising (as
those terms are used in Regulation D under the U.S. Securities Act) was used by
us, including advertisements, articles, notices or other communications
published in any newspaper, magazine or similar media or broadcast over radio,
television, or telecommunications, including electronic display or the
connection with the offer or sale of the Securities;
	 
	 	(E)	 	the offering of the Securities has been conducted by us in
accordance with the terms of the Agency Agreement; and
	 
	 	(F)	 	prior to any sale of Securities, we obtained properly completed
and executed Subscription Agreements from all purchasers.

C-4

 

Terms used in this certificate have the meanings given to them in the Agency Agreement unless
otherwise defined herein.

Dated this       day of February, 2011

	 	 	 	 	 
	BROADBAND CAPITAL MANAGEMENT LLC

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 

C-5

 

	 	 	 	 	 

SCHEDULE “D”

[INTENTIONALLY OMITTED — SEE EXHIBIT 10.2 TO THIS CURRENT REPORT ON FORM 8-K ]

D-1

 

SCHEDULE “E”

February 23, 2011

Clarus Securities Inc.

1615, 200 Burrard Street

Vancouver, British Columbia

V6C 3L6

Broadband Capital Management LLC

712 5th Avenue

22nd Floor

New York, New York 10019

TD Securities Inc.

TD Tower, 66

Wellington Street West, 8th Floor

Toronto, ON M5K 1A2

Ladies and Gentlemen:

     The undersigned director or officer of Swisher Hygiene Inc. (the “Company”)
understands that Clarus Securities Inc., Broadband Capital Management LLC and TD
Securities Inc. (together, the “Agents”) have entered into an agency agreement with the
Company dated February 23, 2011 (the “Agency Agreement”) providing for the private
placement offering (the “Offering”) of 12,262,500 Subscription Receipts (as such term
is defined in the Agency Agreement). This Lock-Up Agreement is being entered into in
accordance with Section 10(d) of the Agency Agreement.

     In consideration for the benefit that the Offering will confer upon the Company,
and for other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the undersigned agrees with the Company and the Agents that the
undersigned will not, directly or indirectly, without the prior written
consent of Clarus Securities Inc. (which consent may not be unreasonably withheld):

	 	(i)	 	offer, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, announce any intention to
sell, grant any option, right or warrant for the sale of, or otherwise
dispose of or transfer any common shares in the capital of the Company
(“Common Shares”) or any securities convertible into or exchangeable or
exercisable for Common Shares, whether now owned or hereafter acquired by the
undersigned or with respect to which the undersigned has or hereafter
acquires the power of disposition; or
	 
	 	(ii)	 	enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Shares, whether any such swap or
transaction is to be settled by delivery of Common Shares or other
securities, in cash or otherwise; or
	 
	 	(iii)	 	to publicly announce an intention to effect any transaction
specified in clause (i) or (ii) above,

E-1

 

in each case, until the later to occur of (i) four months and one day after the Closing
Date (as defined in the Agency Agreement); and (ii) the earlier of: (a) November 10,
2011; and (b) the date the Registration Statement (as defined in the Agency Agreement)
becomes effective, other than pursuant to a bona fide offer by a third party to
acquire Common Shares or securities exchangeable or convertible into Common Shares made
to all holders of such securities. For the purposes of clarity, this Lock-up
Agreement does not apply to actions taken by the undersigned on behalf of the Company in
his official capacity as an officer or director of the Company.

     The undersigned hereby represents and warrants that the undersigned has full power
and authority to enter into this Lock-Up Agreement and that, upon request, the
undersigned will execute any additional documents necessary or desirable in connection
with the enforcement hereof. Any obligations of the undersigned shall be binding upon
the successors and assigns of the undersigned.

     The undersigned understands that the Company and the Agents will proceed with the
Offering in reliance on this Lock-Up Agreement and the representation and warranties
contained herein.

     This Lock-Up Agreement will be governed by the laws in force in the Province of
Ontario and the laws of Canada applicable therein.

	 	 	 	 	 
	 	Very truly yours,

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

E-2

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