Legal Disclaimer

Non Disclosure

Recitals

(a) The Disclosing Party intends to disclose information to the Receiving Party to assist the Receiving Party in evaluating a possible business transaction involving the Disclosing Party; and

(b) The Receiving Party has agreed to keep such information confidential on the terms of this Agreement.

In consideration of the foregoing, the mutual agreements contained in this agreement and other good and valuable consideration (the receipt and adequacy of which are acknowledged), the Parties agree as follows:

Section 1 Defined Terms

As used in this Agreement, the following terms have the following meanings:

“Agreement” means this confidentiality and non-disclosure agreement, as amended, modified, restated, replaced or supplemented from time to time.

“Business Day” means any day of the year, other than a Saturday, Sunday or any days on which major banks are closed for business in Toronto, Ontario.

“Confidential Information” has the meaning specified in Section 3.

“Evaluation Material” means all Confidential Information and all Work Papers.

“Law” means any applicable law, statute, code, constitution, treaty, ordinance, order, decree, directive, rule, published policy, regulation or decision of any competent judicial, legislative, administrative, ministerial, departmental or regulatory body or authority or by the rules, policies or other requirements of any relevant stock exchange.

“Notice” has the meaning specified in Section 8.

“Parties” means the Disclosing Party and the Receiving Party and any other Person who may become a party to this Agreement. Reference to a Party includes such Party’s Representatives and affiliates.

“Person” means a natural person, partnership, limited partnership, limited liability partnership, corporation, limited liability company, unlimited liability company, joint stock company, trust, unincorporated association, joint venture or other entity or a governmental or other regulatory entity, and pronouns have a similarly extended meaning.

“Representative” of a Party, means any director, officer, employee, agent or advisor of that Party, including, accountants, counsel, lenders, potential sources of financing, consultants and financial advisors.

“Transaction” means a potential transaction or series of potential transactions involving the Disclosing Party and the Receiving Party relating to the purchase, sale, merger, amalgamation, joint venture, exchange or any other transaction involving, directly or indirectly, any of the assets or shares of the Disclosing Party.

“Work Papers” means all notes, analyses, compilations, forecasts, data, studies, interpretations, or other documents prepared by, on behalf of or for the benefit of, the Receiving Party that contain, reflect, summarize, analyze, discuss or review any Confidential Information.

Section 2 Interpretation

In this Agreement the words “including”, “includes” and “include” mean “including (or includes or include) without limitation”. The expression “Section” or other subdivision followed by a number mean and refer to the specified Section or other subdivision of this Agreement. Words importing the singular number only include the plural and vice versa.

Section 3 Non-Disclosure of Confidential Information

1. The Receiving Party will keep confidential the Evaluation Material, will use the Evaluation Material solely to evaluate a Transaction and, not directly or indirectly, for any other purpose and will not disclose such Evaluation Material except as permitted by this Agreement.

2. The Receiving Party shall:

a. keep all Confidential Information separate from all other documents and information;

b. establish and maintain adequate security measures to safeguard the Confidential Information from unauthorised access or use; and

c. keep the Confidential Information under its effective control.

3. “Confidential Information” means all information relating to the Disclosing Party’s business, operations, assets, liabilities, plans, prospects and affairs which has been provided by the Disclosing Party to the Receiving Party regardless of whether such information is in oral, visual, electronic, written or other form and whether or not it is identified as “confidential” and includes, inter alia, all trade secrets, know-how, technology, inventions, techniques and methodology, prototypes, designs, drawing and sketches; suppliers and consultants; employee and employee compensation information and records; pricing information, costs and budgets; licence or sublicense arrangements; contracts; research and development activities; computer data, files, tapes, disks, programs (including source codes and object codes) and the information contained therein; sales or marketing techniques or plans; operations and service manuals; business, statistical and technical data, reports, records and files; procedures, processes, proposals and plans; financial information and projections; business and legal information and communications, mail, notes, correspondence, discussions and memoranda.

Confidential Information does not include any information that the Receiving Party can demonstrate:

a. is or becomes generally available to the public, other than as a result of disclosure directly or indirectly by the Receiving Party;

b. is or becomes available to the Receiving Party on a non-confidential basis from a source other than the Disclosing Party; or

c. is or was independently acquired or developed by the Receiving Party without violating such Party’s obligations under this Agreement.

4. Each Party acknowledges that it and its Representatives are bound by all applicable privacy legislation with respect to any “personal information” (as such term is defined in the Personal Information Protection and Electronic Documents Act) disclosed under this Agreement.

5. The restrictions set out in Section 3(a) do not apply to Evaluation Material that the Receiving Party can demonstrate:

a. is required to be disclosed by Law, unless such Law permits the Disclosing Party to refrain from Making such disclosure for confidentiality or other reasons; or

b. is permitted to be disclosed by the Disclosing Party in writing.

The Receiving Party may disclose Evaluation Material to its Representatives but only to the extent that such Representatives need to know the Evaluation Material and have been informed of the confidential nature of the Evaluation Material.

6. The Receiving Party may disclose to parties as necessary to determine a fit should financing be sought but all such parties must be covered under an Non Disclosure Agreement with terms similar in meaning and spirit to SZC’s Non Disclosure Agreement.

7. Unless required by Law, neither Party may disclose the fact that investigations or negotiations concerning a Transaction are taking place or the terms, conditions or other facts relating to a Transaction, including the existence or terms of this Agreement.

8. If the Receiving Party is required to make disclosure pursuant to Law it will, after consultation with the Disclosing Party:

a. give the Disclosing Party prompt Notice of the requirement and the proposed content of any disclosure;

b. provide reasonable assistance to the Disclosing Party in limiting the extent of the disclosure and in obtaining an appropriate protective order or pursuing such legal action, remedy or assurance as the disclosing Party deems reasonably necessary to preserve the confidentiality of the Evaluation Material; and

c. disclose only that portion of the Evaluation Material that it is legally compelled to disclose.

Section 4 Return or Destruction of Confidential Information

1. Each Party will give the other Party immediate Notice of any determination not to proceed with the Transaction. If such Notice is given, or at any time upon the written request of the Disclosing Party, the Receiving Party will and will cause its Representatives to, within ten Business Days of the Notice or request, return or destroy (at its option) all Confidential Information to the Disclosing Party without retaining any copies and destroy all copies of Work Papers in its possession or control; provided, however, that in any event the Receiving Party shall certify to the Disclosing Party in writing that all Evaluation Material has been destroyed or returned.

2. The obligation to return or destroy electronic Evaluation Material shall not apply (i) to copies of Confidential Information made as a matter of routine information technology backup and (ii) to the retention of Confidential Information which is required by any applicable law, rule, professional duty and/ or internal compliance procedures.

Section 5 No Representation or Warranty

1. The Disclosing Party makes no representation or warranty, expressed or implied, as to the accuracy or completeness of the Confidential Information disclosed by it.

2. The Disclosing Party is not liable to Receiving Party or to any other Person for any losses, liabilities, damages, claims, demands or expenses resulting from, connected with or arising out of the Receiving Party’s use of the Confidential Information. This Agreement does not benefit or create any right or cause of action in, or in favour of, any Person other than the Parties. Only the Parties are entitled to rely on its provisions in any action, suit, proceeding, hearing or other forum.

3. To the extent that any Confidential Information is owned by the Disclosing Party it will remain the exclusive property of the Disclosing Party. Nothing in this Agreement or in the disclosure of any Confidential Information confers any interest in the Receiving Party in the Confidential Information.

Section 6 Remedies

1. In the event of a breach of a Party’s obligations under this Agreement, that Party must, forthwith following discovery of the breach, give Notice to the other Party of the nature of the breach. The breaching Party must upon consultation with the other Party take all steps reasonably necessary to limit the extent of the breach.

2. Disclosure or use of Evaluation Material contrary to this Agreement, or any other failure to comply with the terms and conditions of this Agreement, may give rise to irreparable injury to the Disclosing Party inadequately compensable in damages. The Disclosing Party may, in addition to any other remedy, enforce the performance of this Agreement by way of injunction or specific performance upon application to a court of competent jurisdiction without proof of actual damages (and without the requirement of posting a bond or other security) and, notwithstanding that damages may be readily quantifiable, the Receiving Party agrees not to plead sufficiency of damages as a defence in any such proceeding.

3. The rights and remedies provided in this Agreement are cumulative and are in addition to, and not in substitution for, any other rights and remedies available at law or equity. All such rights and remedies may be exercised from time to time, and as often and in such order as the applicable Party deems expedient.

Section 7 Other Covenants and Agreements

1. The Parties share a common legal and commercial interest in all Evaluation Material which is and remains subject to all applicable privileges, including solicitor-client privilege, anticipation of litigation privilege, work product privilege and privilege in respect of “without prejudice” communications. No waiver of any privilege is implied by the disclosure of Evaluation Material to any Person pursuant to the terms of this Agreement.

2. Nothing in this Agreement nor the disclosure of Confidential Information to the Receiving Party creates any agency, partnership, joint venture, representative or employment relationship between the Parties. Neither Party will have any legal obligation with respect to any Transaction by virtue of this Agreement other than for the matters agreed to in this Agreement.

3. This Agreement and obligations herein shall terminate two (2) years from the date hereof. Notwithstanding such expiry of the term, the confidentiality and non-use obligations of the Receiving Party under this Agreement, including those relating to personal information, will continue for an indefinite period of time so long as Confidential Information is retained by the Receiving Party and remains Confidential Information as defined herein. The terms and conditions of any definitive agreements between the Parties in respect of a Transaction will supersede the terms of this Agreement to the extent they are inconsistent with this Agreement.

Section 8 Non-Circumvention.

The Receiving Party and its officers and directors, separately and individually, will not make any effort to circumvent the terms of this agreement in an attempt to gain the benefits, contacts, or considerations granted to it including but not limited to (a) contracting directly with any client of the other party, or (b) hiring or contracting with any present or future employee or independent contractor of Disclosing Party, or (c) entering into an agreement for employment or commission with any client or contact of the Disclosing Party. All further deals done through introductions made by SZC are also subject to brokerage fees. In the event of circumvention by the Receiving Party or any of its affiliates, SZC will be entitled to fees as if the deal had been done by SZC.

Section 9 Miscellaneous

1. Any notice, consent, direction or other communication given regarding the matters contemplated by this Agreement (each a “Notice”) must be in writing, sent by personal delivery, courier or facsimile (but not by electronic mail).

Notice is deemed to be given and received (i) if sent by personal delivery or same day courier, on the date of delivery if it is a Business Day and the delivery was made prior to 4:00 p.m. (local time in place of receipt) and otherwise on the next Business Day, (ii) if sent by overnight courier, on the next Business Day, or (iii) if sent by facsimile, on the Business Day following the date of confirmation of transmission by the originating facsimile.

2. Time is of the essence in this Agreement.

3. Except as otherwise expressly provided in this Agreement, each Party will pay for its own costs and expenses incurred in connection with this Agreement. The fees and expenses are those that are incurred in connection with the expenses of legal counsel, investment advisers, bankers, lenders and accountants.

4. No waiver of any provision of this Agreement constitutes a waiver of any other provision (whether or not similar). No waiver is binding unless executed in writing by the Party to be bound by the waiver. A Party’s failure or delay in exercising any right under this Agreement is not a waiver of that right. A single or partial exercise of any right does not preclude a Party from any other or further exercise of that right or the exercise of any other right it may have.

5. This Agreement constitutes the entire agreement between the Parties relating to its subject matter and supersedes all prior agreements, understandings, negotiations and discussions, between the Parties, whether oral or written.

6. This Agreement may only be amended, supplemented, or otherwise modified by written agreement signed by the Parties.

7. This Agreement becomes effective only when executed by all of the Parties. After that time, it is binding on and endures to the benefit of the Parties and their respective successors and permitted assigns.

8. Neither this Agreement nor any of the rights or obligations under this Agreement is assignable or transferable by a Party without the prior written consent of the other Party.

9. If any provision of this Agreement is determined to be illegal, invalid or unenforceable by an arbitrator or any court of competent jurisdiction from which no appeal exists or is taken, that provision will be severed from this Agreement and the remaining provisions will remain in full force and effect.

10. This Agreement is governed by, interpreted and enforced in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable in the province. Each Party irrevocably attorns and submits to the exclusive jurisdiction of the Ontario courts situated in the City of Toronto, and waives objection to the venue of any proceeding in such court or that such court provides an inconvenient forum.