STOCK PURCHASE AGREEMENT between Regis Corporation and EdgeStone Capital Equity Fund, L.P. and its parallel investors and EdgeStone Capital Equity Fund II-A, L.P. and its parallel investors and EdgeStone Capital Mezzanine Fund II, L.P. and its...

STOCK PURCHASE AGREEMENT

between

For the Purchase of All of the Outstanding Capital Stock of

Hair Club Group Inc.

Dated as of November 13, 2004

STOCK PURCHASE AGREEMENT

        THIS STOCK PURCHASE AGREEMENT dated as of the 13^th day of November, 2004 by and between (i) Regis Corporation, as Buyer; (ii) the EdgeStone Group, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Capital, the ▇▇▇▇▇▇ Group, Walmsley, Morton, and each of the Management Shareholders by his or her representative and attorney, the U.S. Nominee as sellers of the Stock; (iii) each of the Optionholders, by his or her representative and attorney, the U.S. Nominee; and (iv) the Company. Buyer, Sellers and the Company are sometimes referred to in this Agreement, individually, as a “party” and, collectively, as the “parties”.

RECITALS:

        WHEREAS the Stock Sellers own 100% of the issued and outstanding capital stock of the Company, a corporation incorporated under the laws of Canada;

        AND WHEREAS the Optionholders and ▇▇▇▇▇▇ beneficially own options to acquire common shares of the Company, which options are to be terminated on the Closing Date for (a) a payment determined in accordance with that certain Bonus Payment Agreement dated November 12, 2004 (the “Bonus Payment Agreement”), among the Company and the Optionholders, with respect to the Optionholders and (b) the payment of the ▇▇▇▇▇▇ Termination Amount (as hereinafter defined) with respect to ▇▇▇▇▇▇;

        AND WHEREAS Buyer wishes to purchase the Stock from the Stock Sellers, and the Stock Sellers wish to sell the Stock, on the terms contained herein;

        AND WHEREAS it is contemplated that prior to Closing, Buyer shall assign its rights hereunder to a wholly-owned subsidiary in compliance with the terms of Section 15.17;

        AND WHEREAS the Optionholders and, in part, ▇▇▇▇▇▇ have become party to this Agreement in consideration for the Option Bonus Amount (as hereinafter defined) and the ▇▇▇▇▇▇ Termination Amount, respectively;

        NOW, THEREFORE, in consideration of the premises and of the representations and warranties, covenants and agreements hereinafter made, the parties hereto have agreed and do hereby agree in manner and form as hereinafter set forth:

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        The aggregate purchase price (the “Purchase Price”) payable by the Buyer for the Stock shall be equal to:

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        Each of the Stock Sellers shall receive as consideration for the sale of its Stock the amount equal to its Pro Rata Stock Share of the Purchase Price.

        Notwithstanding anything in this Agreement to be the contrary the Company and the Subsidiaries may apply cash on hand towards the repayment of indebtedness at any time and from time to time prior to or on the Closing Date.

        Subject to the terms of this Agreement, the parties hereto agree that the Stock Sellers shall sell and the Buyer shall purchase the Stock and the Buyer shall loan to the Company the Option Termination Amount and the Company shall pay the Option Termination Amount as provided in Section 2.3(a)(ii) below (subject to applicable withholding tax and, in respect of Optionholders who are not resident in Canada, compliance with section 116 of the ITA); provided, however, that such transactions shall occur in the following chronological order:

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        Any reference in this Agreement or in any document delivered pursuant to this Agreement to payment shall mean payment by wire transfer of immediately available funds in U.S. dollars to the bank account or accounts designated by the recipient of such payment (or, in the case of the Sellers, Sellers’ Representative) in writing to the Buyer or to the Sellers’ Representative, as the case maybe, not less than two (2) Business Days prior to the date of such payment. The Closing shall be held at the offices of Torys LLP, Suite 3000, ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ at 10:00 a.m., Toronto time, on the Closing Date or such other place as may be agreed by the Buyer and Sellers’ Representative.

        The Company represents and warrants to the Buyer as of the date hereof that (and acknowledges that the Buyer is relying on the representations and warranties in completing the transactions contemplated herein):

        Each of the Company and the Subsidiaries are duly incorporated or amalgamated, organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation, amalgamation, or organization as the case may be. Each of the Company and the Subsidiaries is duly qualified, licensed and authorized to do business as a foreign corporation or an extra-provincial corporation, as applicable, and is in good standing as a foreign corporation or an extra-provincial corporation, as applicable, in the jurisdictions, if any, where it is required to be so licensed, qualified or authorized to conduct its business or own its property, except where the failure to be so licensed, qualified or authorized would not have a Material Adverse Effect.

        Other than the Subsidiaries and the Midwest Joint Ventures, the Company owns no securities issued by any other corporation, partnership or joint venture, except temporary investments in the ordinary course of business.

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           Except as set forth in Section 3.5 of the Disclosure Schedule, no material consent or approval of, giving of notice to, registration with or taking of any action in respect of or by any Governmental Authority is required to be obtained or given by the Company or a Subsidiary with respect to the execution, delivery or performance by the Company of this Agreement.

           Except as set forth in Section 3.6 of the Disclosure Schedule, the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated herein by the Company does not and will not with the passage of time or the giving of notice or both:

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         Except for assets disposed of, consumed, sold, collected or used since the Interim Date in the ordinary course of business or otherwise noted in Section 3.9 of the Disclosure Schedule, each of the Company and each of the Subsidiaries owns all of its assets (including, without limitation, those reflected in the Interim Financial Statements) free and clear of all Liens, except for Permitted Liens, which assets, together with other assets which the Company or any Subsidiary has the right to use, constitute all of the material assets necessary for the conduct of, or otherwise material to, the business and operations of the Company and its Subsidiaries, as presently conducted.

         Except as disclosed in Section 3.10 of the Disclosure Schedule, all material leases of Leasehold Real Estate are in good standing and such Company or Subsidiaries as the case may be party thereto, is not in default in payment of rent or in performance of its material obligations thereunder.

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(all such leases, agreements, contracts or commitments, the “Contracts”). The Company has previously made available to the Buyer true and complete copies of each Contract, including true and complete descriptions of any oral Contract, in all cases as amended and in effect as of the date of this Agreement. All Contracts are valid and binding obligations of the Company or the Subsidiaries who are a party thereto, in accordance with their respective terms and conditions.

        Except as set out in Section 3.13 of the Disclosure Schedule, there is no agreement, judgment, injunction, order or decree binding upon the Company, or any of the Subsidiaries prohibiting the conduct of business by Company and the Subsidiaries as currently conducted.

3.14 Absence of Changes.

        Except as set forth in this Agreement or in Section 3.14 of the Disclosure Schedule, (i) since December 31, 2003, the Company and the Subsidiaries have conducted their business only in the ordinary course consistent with past practice in all material respects, and; (ii) the Company and the Subsidiaries have not since December 31, 2003:

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        All patents, patent applications, registered trademarks or service marks, trademark or service ▇▇▇▇ applications, registered copyrights and copyright applications owned by any of the Company or the Subsidiaries and material to the business of the Company and the Subsidiaries are listed in Section 3.15 of the Disclosure Schedule (“Intellectual Property Assets”). Each of the Intellectual Property Assets has been registered in, filed in or issued by the United States Patent and Trademark Office, the United States Register of Copyrights or the corresponding offices or registries of other countries, states or other jurisdictions to the extent set forth on said Section 3.15 of the Disclosure Schedule. Except as set forth in Section 3.15 of the Disclosure Schedule, none of the Company or the Subsidiaries has received any written notice within the past three (3) years from a third party claiming that the continuing conduct by the Company and the Subsidiaries of their business as presently conducted will result in the infringement of any patents, trade names, trademarks, service marks or copyrights owned by any third person or challenging the validity of any registration for and of the Intellectual Property Assets except for such instances where the claim has been settled without continuing liability.

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        Except as set forth in Section 3.17 of the Disclosure Schedule, there is no unfair labor practice complaint against any of the Company or the Subsidiaries pending before the National Labor Relations Board or any applicable provincial labour board or, to the Knowledge of the Company, threatened before the National Labor Relations Board or any applicable provincial labour board. Except as set forth in Section 3.17 of the Disclosure Schedule, there are no proceedings pending or, to the Knowledge of the Company, threatened, before the National Labor Relations Board, the Equal Employment Opportunity Commission, the United States Departments of Labor, Civil Rights, and/or Justice or any other Governmental Authority in any jurisdiction with respect to any of the Company or the Subsidiaries that would have a Material Adverse Effect. There is no labor strike or lockouts pending or, to the Knowledge of the Company, threatened against any of the Company or the Subsidiaries that would have a Material Adverse Effect. To the Knowledge of the Company, there is no pending or threatened representation question involving an attempt to organize a bargaining unit, including any employees of any of the Company or the Subsidiaries. None of the Company or the Subsidiaries is a party to or bound by any collective bargaining agreement. No collective bargaining agreement is currently being negotiated by any of the Company or the Subsidiaries with respect to the employees of any of the Company or the Subsidiaries.

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        The physical properties, business, operations and assets of the Company and the Subsidiaries are insured against loss or damage pursuant to the insurance policies set forth in Section 3.19 of the Disclosure Schedule.

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        Except as set forth in Section 3.21, each of the Company and the Subsidiaries, respectively, holds all licenses, permits and authorizations necessary for the lawful operation of its business as presently conducted pursuant to all applicable statutes, laws, ordinances, rules and regulations of all Governmental Authorities having jurisdiction over the Company or any Subsidiary, other than such licenses, permits and authorizations the absence of which would not have a Material Adverse Effect.

        Except as set forth in Section 3.22 of the Disclosure Schedule, each of the Company and the Subsidiaries is in compliance with requirements of applicable statutes, laws, ordinances, regulations, rules, codes or decrees, whether foreign or domestic, federal, state, provincial, municipal or local, which affect it or its business or assets or to which it is subject (but excluding Environmental Laws which are covered exclusively by Section 3.20 (Environmental Matters) hereof, excluding laws regarding Taxes which are covered exclusively by Section 3.18 (Taxes and Tax Returns) and excluding laws regarding Plans covered exclusively by Section 3.16) (the “Laws”), except for such instances where the failure to comply would not constitute a Material Adverse Effect. To the Knowledge of the Company, none of the Company nor the Subsidiaries has received within the last twelve (12) months any written notice or other written communication from any Governmental Authority with respect to violation and/or failure to comply with the Laws.

        Except as set forth in Section 3.23 of the Disclosure Schedule, except in respect of employment benefits and employment compensation to and related non-competition and

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confidentiality covenants of officers, directors, and employees, except for those arrangements terminated without continuing liability to the Company or its Subsidiaries on or before Closing and except for arrangements between the Company and a Subsidiary or between Subsidiaries, none of the Company or the Subsidiaries is a party to any contract, agreement, loan or arrangement with any Seller or any director or executive officer of the Company or any Subsidiary.

        Except as set forth in Section 3.24 of the Disclosure Schedule, there is no action, suit, investigation, subpoena or proceeding pending or, to the Knowledge of the Company, threatened against any of the Company or the Subsidiaries.

        Except as set forth in Section 3.25 of the Disclosure Schedule, the Company has not dealt with any broker or finder in connection with the transactions contemplated herein who would be entitled to a fee or commission from the Company or its Subsidiaries in connection with the transaction contemplated herein.

        Each of the Sellers severally (and not jointly nor jointly and severally except as expressly provided in Section 13.8 with respect to the ▇▇▇▇▇▇ Group and the ▇▇▇▇▇▇ Group) represents and warrants to the Buyer as of the date hereof that (and acknowledges that the Buyer is relying on the representation and warranties in completing the transaction contemplated herein):

4.2 Capitalization.

        (i) Such Seller is the registered owner of the Stock indicated as being held by such Seller (hereinafter referred to in this Section 4.2 with respect to such Seller as such “Seller’s Stock”) in Section 4.2 of Schedule 4 (except that with respect to each member of the EdgeStone Group, such Seller’s Stock is registered in the name of a nominee and except that with respect to the Management Shareholders each of such Seller’s Stock is registered in the name of the U.S. Nominee), (ii) such Seller is the beneficial owner of such Seller’s Stock (iii) such Seller’s

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Stock is validly issued, fully paid and non-assessable, and (iv) except as disclosed in Section 4.2 of the Disclosure Schedule, such Seller has no Options or any options, warrants, conversion privileges or other rights, agreements, arrangements or commitments (pre-emptive, contingent or otherwise) for the purchase or sale of securities of the options, warrants, conversion privileges or other rights, agreements, arrangements or commitments (pre-emptive, contingent or otherwise) for the purchase or sale of securities of any of the Company or its Subsidiaries.

        Unless such Seller’s name is listed on Section 4.3 of Schedule 4, such Seller is not a non-resident of Canada under the ITA. If such Seller is a partnership or limited partnership, Section 4.3 of Schedule 4 correctly sets out the names of all its partners that are non-resident of Canada under the ITA.

        Except as set forth in Section 4.4 of Schedule 4, such Seller has not dealt with any broker or finder in connection with the transactions contemplated herein who would be entitled to a fee or commission in connection with the transactions contemplated herein.

        There is no action, suit, complaint, claim, cause of action, investigation, subpoena or proceeding pending, or to such Seller’s knowledge, threatened against such Seller, nor has any order, writ, injunction, subpoena or decree been issued by any court or Governmental Authority to such Seller which, in either case, prohibits or seeks to enjoin the transactions contemplated by this Agreement.

        Except as set forth in Section 4.6 of Schedule 4, except in respect of employment benefits and employment compensation to any officer, director, or employee who is a Seller, and except for those arrangements terminated without continuing liability to the Company or its Subsidiaries on or before Closing, none of the Company or the Subsidiaries is a party to any contract, agreement, loan or arrangement with such Seller or, in the case of an individual Seller, any family member or relative of such Seller.

        In the case of each of the EdgeStone Funds: (i) such partnership (which, for greater certainty, does not include any partner of such a partnership or any parallel investor) does not own any shares of Regis Corporation, any securities that are convertible or exchangeable for the shares of Regis Corporation or, to the knowledge of the general partner of such partnership without inquiry, any other property the fair market value of which is attributable to any shares of Regis Corporation; and (ii) each such partnership does not have any current intention to acquire any shares of Regis Corporation, any securities that are convertible or exchangeable for the shares of Regis Corporation or, to the knowledge of the general partner of such partnership without inquiry, any property the fair market value of which is attributable to any shares of Regis Corporation.

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        In the case of ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ Capital: (i) each such Person and any Person not dealing at arm’s length with such Person for purposes of the ITA does not own any shares of Regis Corporation, any securities that are convertible or exchangeable for the shares of Regis Corporation or, to its knowledge without inquiry, any other property the fair market value of which is attributable to any shares of Regis Corporation and (ii) each such Person and any Person not dealing at arm’s length with such Person for purposes of the ITA does not have any current intention to acquire any shares of Regis Corporation, any securities that are convertible or exchangeable for the shares of Regis Corporation or, to the knowledge of such Person without inquiry, any property the fair market value of which is attributable to any shares of Regis Corporation.

        In the case of ▇▇▇▇▇▇ and LMco: (i) each such Person and any Person not dealing at arm’s length with such Person for purposes of the ITA does not own any shares of Regis Corporation, any securities that are convertible or exchangeable for the shares of Regis Corporation or, to its knowledge without inquiry, any other property the fair market value of which is attributable to any shares of Regis Corporation and (ii) each such Person and any Person not dealing at arm’s length with such Person for purposes of the ITA does not have any current intention to acquire any shares of Regis Corporation, any securities that are convertible or exchangeable for the shares of Regis Corporation or, to the knowledge of such Person without inquiry, any property the fair market value of which is attributable to any shares of Regis Corporation.

        Buyer represents and warrants to Sellers as of the date hereof that (and acknowledges that the Sellers are relying on the representation and warranties in completing the transaction contemplated herein):

        The Buyer is duly incorporated or amalgamated, organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization as the case may be. The Buyer is duly qualified, licensed and authorized to do business as a foreign corporation or an extra-provincial corporation, as applicable, and is in good standing as a foreign corporation or an extra-provincial corporation, as applicable, in the jurisdictions, if any, where it is required to be so licensed, qualified or authorized to conduct its business or own its property, except where jurisdictions in which the failure to be so licensed, qualified or authorized would not have a Material Adverse Effect.

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        Except as set forth in Section 5.3 of Schedule 5, no consent or approval of, giving of notice to, registration with, or taking of any action in respect of or by, any Governmental Authority, is required with respect to the execution, delivery or performance by Buyer of this Agreement.

5.4 Investment Representations.

        Buyer is an accredited investor within the meaning of the Securities Act of 1933, as amended to date, and acknowledges that it is able to evaluate, and can bear, the economic risk of its investment. Buyer has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the Stock. Buyer is acquiring the Stock for investment and not with a view to, or for sale in connection with, any distribution thereof nor with any present intention of distributing or selling such Stock. Buyer acknowledges that the Stock shall not be transferable in the absence of: (i) registration under relevant federal and state laws, the rules promulgated thereunder or an exemption therefrom; and/or (ii) registration or qualification under the provisions of any applicable blue sky laws or an exemption therefrom. Except for the representations and warranties set forth in Section 3 and Section 4 hereof, Buyer acknowledges that Sellers and Company have made no representations or warranties, implied or expressed, regarding Sellers, the Company or the Subsidiaries, the assets, liabilities or business of the Company or the Subsidiaries, or the Stock.

        There is no action, suit, complaint, claim, cause of action, investigation, subpoena or proceeding pending, or to Buyer’s knowledge, threatened against Buyer, nor has any order, writ, injunction, subpoena or decree been issued by any court or Governmental Authority to Buyer which, in either case, prohibits or seeks to enjoin the transactions contemplated by this Agreement.

        Except as set forth in Section 5.6 of Schedule 5, Buyer has not dealt with any broker or finder in connection with the transactions contemplated herein.

        As at and from the date hereof, the Buyer is solvent and has and will have at Closing, sufficient financial resources to pay the Purchase Price in full in cash and make the loans contemplated by Section 2.3(a)(i) and (ii) in accordance with the terms of this Agreement and without limiting, the foregoing, the Buyer’s sources of such funds contain no conditions to the

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Buyer’s drawing such funds and the Buyer will draw all such necessary funds on the Closing Date.

        The Company covenants and agrees with the Buyer as follows prior to the Closing Date:

        Except as contemplated by this Agreement (including the Disclosure Schedule) and except with the prior written consent of the Buyer (which consent shall not be unreasonably withheld, conditioned or delayed in the case of subsections (g) and (h) below), the Company shall and shall cause each of the Subsidiaries to conduct its business only in the ordinary course of business, including without limitation with respect to working capital, and, furthermore, except as contemplated by this Agreement (including the Disclosure Schedule), the Company and the Subsidiaries shall not (except with the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed in the case of subsections (g) and (h) below):

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        The Company will, upon reasonable notice, permit Buyer, Buyer’s counsel, auditors, environmental consultants, appraisers and other advisers and representatives to review and inspect all financial and business records and documents (except for trade secrets) of the Company and the Subsidiaries in the custody, care or control of Company or a Subsidiary and to have reasonable access to the Company and the Subsidiaries throughout all regular business hours upon reasonable prior notice, provided the same does not unduly disrupt the conduct of their business, and subject to existing confidentiality and non-disclosure obligations of Buyer and its affiliates.

        Each of the Sellers (severally and not jointly nor jointly and severally except as expressly provided in Section 13.8 with respect to the ▇▇▇▇▇▇ Group and the ▇▇▇▇▇▇ Group) covenants and agrees with Buyer as follows throughout the period from the date hereof through the Closing:

        Such Seller shall not sell, transfer, assign, pledge or otherwise convey to any person or entity other than Buyer or its nominees any of such Seller’s Stock or any Options owned by such Seller except that such Seller may sell, transfer, assign or otherwise convey any of such Seller’s Stock to one or more of its affiliates prior to the Closing provided that such Seller shall cause any such affiliate to sell, transfer, assign or otherwise convey such Stock to Buyer or its nominee in accordance with the terms of this Agreement. In the event of such transfer, the term “Seller” in this Agreement shall apply to both such Seller and the affiliate or affiliates to which such Seller has transferred any of the Stock.

        Such Seller shall use reasonable efforts to obtain all authorizations, consents and approvals of third persons and Governmental Authorities that may be required to permit the consummation by such Seller of the transactions contemplated by this Agreement. Such Seller shall use its reasonable efforts to satisfy all conditions to the Closing that are within its control to the end that the transactions contemplated by this Agreement shall be fully carried out. In making reasonable efforts under this Section 7.2, such Seller shall not be required to make any payment (other than reasonable legal fees) that they are not presently contractually required to make, enter into any other agreement or arrangement with any person that it is not presently contractually required to enter into, accept any significant modification in any existing agreement or arrangement, or agree to any of the foregoing.

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        From and after the date of this Agreement until Closing, such Seller shall not, directly or indirectly, solicit, initiate, or encourage any inquiries or proposals from, discuss or negotiate with, provide any non-public information to, or enter into any agreement with, any Person (other than the Buyer) relating to any transaction involving the sale of any shares of the Company (except as permitted under Section 7.1 hereof), the sale of all or a portion of the business or assets of the Company or its Subsidiaries (other than sales of assets in the ordinary course consistent with past practice), or any other business combination transaction involving the Company or its Subsidiaries.

        Such Seller shall not, for and during the period of three (3) years from the Closing Date, without Buyer’s prior consent, which consent may be withheld in the Buyer’s discretion, acquire all or any significant portion of the capital stock of, or all or any material portion of the assets of, ▇▇▇▇▇▇ Medical Institute, Inc., a Delaware corporation or Medical Hair Restoration, a Florida corporation.

        Such Seller shall not, for and during the period of three years from the Closing Date, employ, offer employment to or solicit the employment or engagement of any individual who is employed by the Company or any of its Subsidiaries in a senior management position or was so employed by the Company or any such its Subsidiary within 3 months prior to such employment, offer or solicitation by such Seller.

        In the case of the ▇▇▇▇▇▇ Group and the ▇▇▇▇▇▇ Group only, each of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Capital, ▇▇▇▇▇▇ and LMCo covenants not to acquire within the two year period following the Closing Date shares of Regis Corporation, any securities that are convertible or exchangeable for shares of Regis Corporation or any other property the fair market value of which is attributable to any shares of Regis Corporation, and each of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Capital, ▇▇▇▇▇▇ and LMCo shall use his or its reasonable best efforts to ensure that Persons with whom such Seller does not deal at arm’s length (within the meaning of the ITA) do not acquire within the two year period following the Closing Date shares of Regis Corporation, any securities that are convertible or exchangeable for shares of Regis Corporation or any other property the fair market value of which is attributable to any shares of Regis Corporation.

        In the case of each EdgeStone Fund only, such EdgeStone Fund covenants not to acquire within the two year period following the Closing Date shares of Regis Corporation, any securities that are convertible or exchangeable for shares of Regis Corporation or any interests in any entity the value of which, to the knowledge of such EdgeStone Fund without inquiry, is derived primarily from such shares or securities and such EdgeStone Fund shall not knowingly cause Persons controlled by such EdgeStone Fund for purposes of the ITA to acquire within the two year period following the Closing Date shares of Regis Corporation, any securities that are convertible or exchangeable for shares of Regis Corporation or any interests in any entity the

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value of which, to the knowledge of such EdgeStone Fund without inquiry, is derived primarily from such shares or securities.

8. COVENANTS OF BUYER.

     Buyer covenants and agrees with Sellers as follows throughout the period from the date hereof through the Closing:

8.1 Confidentiality.

     The Buyer reaffirms the non-disclosure agreement dated August 19, 2004 (the “Confidentiality Agreement”), between the Buyer and the Company, and agrees to fulfill its obligations thereunder through the Closing Date. If this Agreement is, for any reason, terminated prior to the Closing, the Confidentiality Agreement shall nonetheless continue in full force and effect.

8.2 Authorization / Consummation.

     Buyer shall use its reasonable efforts to obtain all authorizations, consents and approvals of third persons and Governmental Authorities that may be required to permit the consummation by Buyer of the transactions contemplated by this Agreement. Buyer shall use reasonable efforts to satisfy all conditions to the Closing that are within their control to the end that the transactions contemplated by this Agreement shall be fully carried out.

     Except in respect of fees required to be paid by Buyer as described in Sections 9.1 and 9.2, in making reasonable efforts under this Section 8.2, Buyer shall not be required to make any payment (other than reasonable legal fees) that they are not presently contractually required to make, enter into any other agreement or arrangement with any person that it is not presently contractually required to enter into, accept any significant modification in any existing agreement or arrangement, or agree to any of the foregoing.

9. MUTUAL COVENANTS OF COMPANY AND BUYER.

9.1 Regulatory Filings.

     Each of the Company and the Buyer hereto will furnish to the other such necessary information and reasonable assistance as such other may reasonably request in connection with its preparation of filings or submissions to any Governmental Authority required in connection with this Agreement and the transactions contemplated hereby. Buyer shall be responsible for all filing fees and other expenses that are payable in connection with such filings and submissions required by applicable law to be made by Buyer (including, for greater certainty, all filing fees under the HSR Act required in connection with the transactions contemplated by this Agreement). The Company shall be responsible for all filing fees and other expenses that are payable in connection with such filings and submissions required by applicable law to be made by the Company and, for greater certainty, the Company shall not be responsible for any filing fees in respect of any filing required under the HSR Act or any similar law in connection with the transactions contemplated herein.

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9.2 ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act.

     Buyer and Company, at Buyer’s expense, shall prepare all necessary documentation and perform all other necessary actions to complete all necessary filings under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended (the “HSR Act”) and shall each request early termination of the waiting period in their respective filings. The Company and the Buyer shall file a notification and report form pursuant to the HSR Act as promptly as practicable after the date of execution of this Agreement (and in any event within two (2) Business Days of the date of execution of this Agreement). Each party agrees to use reasonable efforts to respond to any request for additional information within five (5) days of receipt of the request. In the event the applicable waiting period (which term includes the extension period) under the HSR Act (a “Required Waiting Period”) has not expired or terminated by the Closing Date, the Closing Date shall be delayed until five (5) Business Days after expiration of the last applicable Required Waiting Period or, if required by law, after approval has been obtained but in no event shall the Closing Date be delayed later than December 21, 2004.

9.3 Tax Matters.

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10. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER TO CLOSE.

     The obligation of Buyer to acquire the Stock as contemplated hereby, and the obligation of the Buyer to perform its other obligations hereunder to be performed on or after the Closing Date, shall be subject to the fulfillment, on or prior to the Closing Date, unless otherwise waived in writing by Buyer, of the following conditions:

10.1 Representations and Warranties.

     The representations and warranties of (i) the Company set forth in Section 3 hereof and (ii) the Sellers set forth in Section 4 hereof; shall (disregarding all qualifications and exceptions contained in such representations relating to materiality or Material Adverse Effect) be true and correct on the Closing Date as if made on and as of such date or, to the extent that any such representations and warranties, by their terms, are made expressly as of the date hereof or another date, as of such other date (except, in any case, where such failure to be true and correct shall not have a Material Adverse Effect).

10.2 Performance of Covenants.

     Sellers and Company shall have performed in all material respects all of their obligations contained in this Agreement to be performed on or prior to the Closing Date.

10.3 Threatened or Pending Proceedings.

     No proceedings shall have been initiated (and not dismissed) by any Governmental Authority seeking to enjoin or otherwise restrain the consummation of the transactions contemplated hereby.

10.4 Consents and Approvals.

     Any applicable waiting periods under the HSR Act shall have expired or been terminated.

10.5 Delivery of Stock.

     All of the Stock shall have been delivered to Buyer as required by the terms hereof.

10.6 Options and Stock Loans.

     All Options in respect of stock of the Company shall have been exercised or terminated at or prior to Closing. All loans made by the Company to a Seller in connection with the purchase

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of stock shall be repaid on Closing and any security granted by such Seller to the Company shall be released.

10.7 Legal Opinion of Torys LLP.

     Buyer shall have received opinions dated as of the Closing Date of Tory s LLP in the form attached as Schedule 10.7.

10.8 No Adverse Changes.

     During the period from the date hereof through the Closing Date, there shall not have been any changes in the business, results of operations, properties or financial condition of the Company and the Subsidiaries taken as a whole since the Interim Date, which have had a Material Adverse Effect.

10.9 Escrow Agreement

     The Sellers (or the Sellers’ Representative on behalf of the Sellers) shall have executed and delivered the Escrow Agreement.

11. CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLERS TO CLOSE.

     The obligation of the Sellers to sell the Stock as contemplated hereby, and to perform their other obligations hereunder to be performed on or after the Closing, shall be subject to the fulfillment, on or prior to the Closing Date, unless otherwise waived in writing by the Sellers’ Representative, of the following conditions:

11.1 Representations and Warranties.

     The representations and warranties of Buyer set forth in Section 5 hereof shall be true and correct in all material respects on the Closing Date as if made on and as of such date, unless otherwise specified therein.

11.2 Performance of Covenants.

     Buyer shall have performed in all material respects all of its obligations contained in this Agreement to be performed on or prior to the Closing Date.

11.3 Threatened or Pending Proceedings.

     No proceedings shall have been initiated (and not dismissed) by any Governmental Authority seeking to enjoin or otherwise restrain the consummation of the transactions contemplated hereby.

11.4 Consents and Approvals.

     Any applicable waiting periods under the HSR Act shall have expired or terminated.

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11.5 Options and Stock Loans.

        All Options in respect of stock of the Company shall have been exercised or terminated at or prior to Closing. All loans made by the Company to a Seller in connection with the purchase of stock shall be repaid on Closing and any security granted by such Seller to the Company shall be released.

11.6 Legal Opinion of Buyer’s Counsel.

        Sellers shall have received opinions, dated as of the Closing Date of counsel to Buyer in the form attached as Schedule 11.6.

11.7 Escrow Agreement

        The Buyer shall have executed and delivered the Escrow Agreement.

12.   CERTAIN RIGHTS AND OBLIGATIONS SUBSEQUENT TO CLOSING.

12.1 Survival of Representations, Warranties, Agreements, Covenants and Obligations.

        All representations and warranties contained herein, and all agreements and covenants contained herein, or in either case in any other certificate executed and delivered by any party to another party in connection with this Agreement, shall be deemed to have been relied upon by the other party and shall survive the execution and delivery of this Agreement, and the sale and purchase of the Stock and payment therefore. Notwithstanding the foregoing, all such representations, warranties, agreements and covenants shall expire and terminate on October 31, 2006, except that: (i) the representations and warranties of each Seller contained in Sections 4.2 {Capitalization} and of the Company contained in Section 3.4 {Capitalization} shall survive indefinitely and (ii) the representations and warranties of the Company contained in Section 3.18 {Tax Matter} shall survive until 30 days after which no assessment, reassessment or other document assessing tax may be issued to the Company or any Subsidiaries in respect of a taxation year to which such representations and warranties extend.

12.2 Company Books and Records.

        For a period of seven (7) years from the Closing Date (or such longer period as may be required of Buyer by any Governmental Authority or requested by Sellers’ Representative in connection with disputes or litigation):

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12.3 Further Assurances.

     From time to time after the Closing without further consideration, the parties will execute and deliver or arrange for the execution and delivery of, such other instruments of conveyance and transfer and take such other action or arrange for such other action as may reasonably be requested to more effectively complete any of the transactions provided for in the Agreement or any document contemplated hereby.

13.    INDEMNIFICATION.

13.1 Indemnification by Sellers.

     Subject to the provisions of this Section 13, from and after Closing, each of the Sellers (severally and not jointly nor jointly and severally) agrees to indemnify and hold Buyer, the Company and the Subsidiaries (the “Buyer Indemnified Parties”) harmless from and against any damages, liabilities, losses and expenses (including, but not limited to, reasonable attorney’s fees incurred in defending any claim by a third person, and amounts paid in settlement of any claim or suit), fines, penalties and interest (collectively, “Loss” or “Losses”) which is sustained or suffered by the Buyer Indemnified Parties to the extent caused by or arising from:

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13.2 Limitations on Amount of Indemnification by Sellers.

        Notwithstanding anything provided in this Agreement to the contrary, the indemnification obligations of each Seller pursuant to Section 13.1 shall be limited as follows:

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13.3 Indemnification by Buyer.

     Subject to the provisions of this Section 13, from and after Closing, Buyer agrees to indemnify and hold Sellers and their shareholders, general and limited partners, officers, directors, employees and agents (the “Seller Indemnified Parties”), harmless from and against any Losses sustained or suffered by the Seller Indemnified Parties to the extent caused by or arising from: (a) a breach of any representation or warranty made by Buyer herein; (b) a failure to perform any covenant made by Buyer herein; or (c) any act or occurrence, which takes place after the Closing pertaining in any way to the operation of the business of the Company and the Subsidiaries by Buyer or any of its affiliates after the Closing (including, without limitation, any warranty or product liability claims, and any liability under employment, labor, discrimination, Tax, Environmental or other laws).

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13.4 Limitations on Amount of Indemnification by Buyer.

     Notwithstanding anything provided in this Agreement to the contrary, the indemnification obligations of Buyer pursuant to Section 13.3 shall be limited as follows:

13.5 Notice and Defense of Claims.

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13.6 Further Limitations and Qualifications on Indemnification.

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13.7 Indemnification Adjustment to Purchase Price.

     Any amounts payable by any of the Sellers under this Section 13 shall constitute a reduction in the Purchase Price and the Option Termination Amount, as appropriate.

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13.8 Certain Joint and Several Liability

     Notwithstanding anything herein to the contrary, (a) ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ Capital shall be jointly and severally liable for any amounts payable hereunder by either of them; (b) ▇▇▇▇▇▇ and LMco shall be jointly and severally liable for any amounts payable hereunder by either of them.

14. TERMINATION OF AGREEMENT.

14.1 Termination.

     At any time prior to the Closing, this Agreement may be terminated: (i) by the mutual written agreement of Buyer and Sellers’ Representative; (ii) by Sellers’ Representative, if the Sellers and the Company are not in material breach of this Agreement, and, if there has been a material misrepresentation, breach of warranty or breach of agreement or covenant by Buyer in its representations, warranties, agreements and covenants set forth herein which misrepresentation or breach remains uncured on the earlier of (a) the date which is fifteen (15) days following Buyer’s receipt of written notice thereof from Sellers’ Representative and (b) December 21, 2004; (iii) by Buyer, if Buyer is not in material breach of this Agreement, and, if there has a been a misrepresentation, breach of warranty or breach of agreement or covenant by Sellers or the Company in their representations, warranties, agreements and covenants set forth herein which misrepresentation or breach (A) constitutes a Material Adverse Effect; and (B) remains uncured on the earlier of (a) the date which is fifteen (15) days following Sellers’ Representative’s receipt of written notice thereof from Buyer and (b) December 21, 2004; (iv) by Buyer, upon written notice to the Sellers’ Representative within five (5) Business Days of receipt of a Supplement in the event that any matter set forth in such Supplement would have a Material Adverse Effect; provided that such matter has not been corrected on the earlier of (a) the date which is fifteen (15) days following delivery of such notice and (b) December 21, 2004; (v) by Buyer or Sellers’ Representative if the Closing has not occurred before the close of business on December 21, 2004, unless such Buyer’s or Sellers’ breach results in the failure of the Closing to occur by such date; or (vi) by Sellers’ Representative upon written notice to the Buyer at any time after receipt of a Buyer Reserve Notice (as defined in Section 15.8).

14.2 Notice of Termination.

     In the event of termination by any party pursuant to Section 14.1, written notice setting forth the reasons therefore shall be given by the terminating party to the other parties.

14.3 Effect of Termination.

     If this Agreement shall be terminated as above provided, all obligations of the parties hereunder shall terminate without liability of any party to the other (other than Sections 8.1, 14.3 15.1, 15.2, 15.4, 15.12 to 15.18 and 15.20 to 15.23); provided, however, that nothing in this Section 14 shall prevent any party from seeking or obtaining damages or appropriate equitable relief for the willful breach of any representation, warranty, agreement or covenant made by any other party (including, without limitation, specific performance for willful failure to close).

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15. MISCELLANEOUS.

15.1 Expenses.

     Buyer shall pay the fees and expenses of its accountants and legal counsel incurred in connection with the transactions contemplated by this Agreement. Buyer shall be responsible for all transfer fees or transfer taxes arising from the transfer of the Stock to Buyer. To the extent not paid by the Company in connection with Section 2.3(a)(ii), each Seller shall pay the fees and expenses of its accountants and legal counsel incurred in connection with the transactions contemplated by this Agreement.

15.2 Notices.

     Any notice or other communication required or permitted to be given to any Person hereunder shall be in writing and shall be given to such Person at such Person’s address set forth below, or such other address as such party may hereafter specify by notice in writing to the other Person. Any such notice or other communication shall be addressed as aforesaid and given by: (1) certified mail (registered mail in Canada), return receipt requested, with first class postage prepaid; (2) hand delivery; (3) reputable overnight courier; or (4) facsimile transmission. Any notice or other communication will be deemed to have been duly given: (1) on the fifth day after mailing, provided receipt of delivery is confirmed, if mailed by certified mail (registered mail in Canada), return receipt requested, with first class postage prepaid; (2) on the date of service if served personally; (3) on the Business Day after delivery to an overnight courier service, provided receipt of delivery has been confirmed; or (4) on the date of transmission if sent via facsimile transmission, provided confirmation of receipt is obtained promptly after completion of transmission.

     To Sellers’ Representative :

EdgeStone Capital Partners Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇ ▇▇▇, The Exchange Tower
Toronto, ON M5X 1A6

ATTN: ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
FAX:    (▇▇▇) ▇▇▇-▇▇▇▇

With a copy to:

▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇▇ Street West
TD Centre
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇

ATTN: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
FAX:    (▇▇▇) ▇▇▇-▇▇▇▇

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To Management
Representative :

▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America

ATTN: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
FAX:    (▇▇▇) ▇▇▇-▇▇▇▇

With a copy to:

Blake, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
Commerce Court West
▇▇▇▇-▇▇▇ ▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇

ATTN: ▇▇▇▇▇ ▇▇▇▇▇▇▇
FAX: (▇▇▇) ▇▇▇-▇▇▇▇

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     To Buyer:

Regis Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇

ATTN: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
             President & CEO
FAX:    (▇▇▇) ▇▇▇-▇▇▇▇

With a copy to:

Regis Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
▇▇▇

ATTN: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.,
             Vice President, General Counsel & Secretary
FAX:    (▇▇▇) ▇▇▇-▇▇▇▇

With a copy to:

Stikeman Elliott LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇

ATTN: ▇▇▇▇▇ Pukier
FAX:    (▇▇▇) ▇▇▇-▇▇▇▇

15.3 Amendment.

     No amendment to this Agreement may be made unless agreed to by the parties hereto in writing.

15.4 Section Headings.

     The section headings in this Agreement are for convenience of reference only and shall not be deemed to be a part of this Agreement or to alter or affect any provisions, terms or conditions contained herein.

15.5 Gender and Number

     In this Agreement, unless the context otherwise requires, words importing the singular include the plural and vice versa and words importing gender include all genders.

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15.6 Calculations in U.S. Dollars.

     All amounts in this Agreement are stated and shall be paid in U.S. dollars.

15.7 Generally Accepted Accounting Principles.

     In this Agreement, except to the extent otherwise expressly provided, references to “generally accepted accounting principles” mean United States generally accepted accounting principles as provided from time to time by the Financial Accounting Standards Board, and consistent with past practice of Company.

15.8 Supplements to Disclosure Schedule or Schedule 4.

     From time to time prior to the Closing Date, Sellers’ Representative may supplement or amend the Disclosure Schedule or Schedule 4 delivered pursuant to this Agreement: (a) if any matter hereafter arises which, if existing or occurring at the date of this Agreement, would have been required to be set forth or described in such supplemental or amended Disclosure Schedule or Schedule 4, as applicable to make the applicable representation true and correct; (b) to correct any information in the Disclosure Schedule or in Schedule 4 or in this Agreement which is inaccurate as a result of any matter resulting or arising after the date hereof; or (c) if otherwise contemplated by this Agreement. Any such supplement or amendment (a “Supplement”), upon written notice thereof to Buyer, shall be effective to modify this Agreement, the Disclosure Schedule and Schedule 4, to qualify the representations and warranties contained in Sections 3 and 4 and to cure any misrepresentation or breach of warranty that otherwise might have existed under this Agreement for all purposes (any such modification, qualification or cure, collectively, an “Amendment”), including, without limitation, determination of the satisfaction of conditions to Closing set forth in Sections 9 and 10 hereof; provided, however, that if the matter or matters to which such Supplement relate would have a Material Adverse Effect, the Buyer may terminate this Agreement in accordance with Section 14.1(iv), provided further, however, if such matter or matters to which such Supplement relate would not have a Material Adverse Effect, and if Buyer notifies Sellers’ Representative in writing within 4 Business Days after delivery of such Supplement that it elects not to have such Supplement be deemed on Amendment (a “Buyer Reserve Notice”), then such Supplement shall not be deemed an Amendment and Sellers’ Representative shall have the right to terminate this Agreement in accordance with Section 14.1(vi).

15.9 Disclosure Schedules and Exhibits.

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15.10 Disclaimer of Other Representations, Projections

     The Buyer acknowledges and agrees that, except for the representations and warranties made by the Company or the Sellers and expressly set forth in Sections 3 or 4, neither the Company, any Subsidiary, any Seller nor any representative thereof has made and shall not be construed as having made to the Buyer or to any representative thereof, and neither the Buyer nor any representative thereof has relied upon or regarded as material, any representation or warranty of any kind. Without limiting the generality of the foregoing, and notwithstanding any otherwise express representations and warranties made by the Company or the Seller in Sections 3 or 4, as applicable, the Buyer agrees that neither the Company, any Subsidiary, any Seller nor any representative thereof makes or has made any representation or warranty to the Buyer or any representative thereof with respect to:

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     Without limiting the foregoing, with respect to any projections, financial models, estimates, forecasts or budgets relating to the business of the Company or the Subsidiary, Buyer acknowledges and agrees that (i) there are uncertainties inherent in attempting to make any projections, financial models, estimates, forecasts or budgets, (ii) it is familiar with such uncertainties, (iii) it is taking full responsibility for making its own evaluation of the adequacy and accuracy of all such projections, financial models, estimates, forecasts or budgets so furnished to it, (iv) planned efficiencies or business opportunities may not materialize for a number of reasons, and (v) the Buyer shall have no claim against the Company, the Sellers or any of their directors, officers, employees, agents, representatives, shareholders, partners or affiliates with respect thereto.

15.11 Severability.

     Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. If any portion of this Agreement is declared invalid for any reason in any jurisdiction, such declaration shall have no effect upon the remaining portions of this Agreement which shall continue in full force and effect as if this Agreement had been executed with the invalid portions thereof deleted; provided, however, if such severability will negate in any material respect the monetary terms of this Agreement, then the parties shall negotiate in good faith to amend the invalid terms in a manner so that such terms shall not be invalid and will not modify in any material respect the monetary terms of this Agreement unless otherwise agreed to by the parties. Furthermore, the entirety of this Agreement shall continue in full force and effect in all other jurisdictions.

15.12 Entire Understanding.

     This Agreement sets forth the entire agreement and understanding between the parties with respect to the subject matter hereof and supercedes any and all prior discussions, negotiations, letters of intent or agreements in principle between them.

15.13 Binding Effect; No Third Party Beneficiaries.

     Except for the provisions of Section 13 relating to the Seller Indemnified Parties and the Buyer Indemnified Parties and Section 15.22 relating to the Sellers’ Representative Indemnified Parties and Section 15.23 relating to the Management Representative Indemnified Parties, this Agreement shall be binding upon and shall inure to the exclusive benefit of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors and permitted assigns and nothing herein, express or implied, is intended to, nor shall it, confer in any other Person any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. The parties agree that, for the purpose of giving enforceable rights under this Agreement: (i) to the Buyer Indemnified Parties who are not party to this Agreement, Buyer is contracting as the agent of such Persons and will hold the rights of such Persons in trust for them; (ii) to the Seller Indemnified Parties who are not party to this agreement, each Seller is contracting as the agent of such Persons and will hold the rights of such Persons in trust for them; (iii) to the Sellers’ Representative Indemnified Parties who are not party to this agreement, the Sellers’ Representative is contracting as the agent of such Persons and will hold the rights of such Persons in trust for them; and (iv) to the Management Representative Indemnified Parties

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who are not party to this agreement, the Management Representative is contracting as the agent of such Persons and will hold the rights of such Persons in trust for them.

15.14 Governing Law.

     This Agreement is and shall be deemed to be a contract entered into and made pursuant to the laws of the Province of Ontario and shall in all respects be governed, construed, applied and enforced in accordance with the laws of said Province, without reference to its conflict of laws rules or principles.

15.15 Choice of Forum and Consent to Jurisdiction.

     Any action arising out of or under this Agreement, any other document, instrument or agreement contemplated herein or delivered pursuant hereto, or the transactions contemplated by this Agreement or any of such other documents, instruments or agreements, shall be brought only in a federal or provincial court having jurisdiction and venue in Ontario, Canada, and each of the parties hereto hereby irrevocably submits to the exclusive jurisdiction of such courts and agrees that venue in Ontario is proper. Sellers hereby irrevocably designates, appoints and empowers (a) in the case of any Management Seller, Cameron Capital and (b) in the case of any other Seller, the Sellers’ Representative and its successors as its authorized special agent to receive, for and on behalf of Sellers, service of process in any such legal action or proceeding, a copy of such process to also be sent in the manner required above for notices to such party. Buyer hereby irrevocably designates, appoints and empowers Stikeman Elliott LLP and its successors, as its authorized special agent to receive, for and on behalf of Buyer and its affiliates, service of process in any such legal action or proceeding, a copy of such process to also be sent in the manner required above for notices to such party. To the extent permitted by applicable law, final judgment against such party (a certified copy of which shall be conclusive evidence of the fact and of the amount of any indebtedness of such party hereunder) in any such legal action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on an unsatisfied judgment or similar proceeding. Each of the parties hereto hereby irrevocably waives and agrees not to assert, by way of motion, as a defense, or otherwise, in any legal action or proceeding, any defense or any claim that it is not personally subject to the jurisdiction of the above-named Ontario courts for any reason, including claims that such party may be immune from the above-described legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, or otherwise), or that such proceeding is brought in an inconvenient or otherwise improper forum or that this Agreement or any of the other aforementioned documents, instruments or agreements, or the subject matter hereof or thereof, may not be enforced in or by such courts, or that the same are governed by the laws of a jurisdiction other than Ontario. Each of the parties hereby specifically agrees that it shall not bring any actions, suits or proceedings arising out of or under this Agreement, any other document, instrument or agreement contemplated herein or delivered pursuant hereto, or the transactions contemplated by this Agreement or any of such other documents, instruments or agreements, in the courts of any jurisdiction other than the above-named courts of Ontario, that any such action brought by any party shall be dismissed upon the basis of the agreements, terms and provisions set forth in this Section 15.15, and that any order or judgment obtained in any such action from a court other than the courts of Ontario shall be void ab initio provided that, notwithstanding the foregoing provisions of this Section 15.15, any party may bring and enforce an action seeking injunctive or other equitable relief in any court of competent jurisdiction.

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15.16 Waiver of Trial by Jury

     EACH PARTY HERETO HEREBY EXPRESSLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM, SUIT, LITIGATION, ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THE PARTIES HERETO AGREE THAT ANY OF THEM MAY FILE A COPY OF THIS PROVISION WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED FOR AGREEMENT BETWEEN THE PARTIES IRREVOCABLY TO WAIVE TRIAL BY JURY, AND THAT SUCH PROCEEDING WHATSOEVER BETWEEN THEM SHALL INSTEAD BY TRIED BY A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.

15.17 Assignability.

15.18 Counterparts; Delivery by Facsimile.

     This Agreement may be executed in counterparts and by each party hereto on a separate counterpart, all of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by telecopier or facsimile transmission shall be effective as delivery of a manually executed counterpart of this Agreement.

15.19 Knowledge of Company.

     For purposes of this Agreement, the term or phrase “Knowledge of the Company” shall mean and be limited to the actual knowledge of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇’ ▇▇▇▇▇ and without personal liability for any such knowledge.

15.20 Public Announcements.

     No public announcements or other publicity regarding the transactions referred to herein shall be made by the Buyer, the Company or Sellers without the prior written approval of the other parties as to form, timing and manner of distribution or publications, except to the extent

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otherwise required by law or stock exchange rules, except that each party may disclose to their current and prospective banks, shareholders, partners, investors and advisors the name of the other party, the date of the transaction, the price and the key terms under this Agreement and except that the EdgeStone Group may disclose information regarding its investment in the Company and the disposition thereof (including relevant terms) in connection with fund raising activities.

15.21 Mutual Drafting.

     The parties hereto are sophisticated and have been represented by lawyers throughout the transactions contemplated hereby who have carefully negotiated the provisions hereof. As a consequence, the parties do not intend that any presumptions or rules related to the interpretation of contracts against the drafter or any particular clause should be applied to this Agreement and therefore waive their effects.

15.22 Sellers’ Representative.

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15.23 Management Representative.

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15.24 ▇▇▇▇▇▇ Option Termination

     ▇▇▇▇▇▇ hereby agrees that, effective automatically upon the Closing, the Options held by him and any and all option agreements, plans or other agreements or documents of any kind relating to options or other rights to acquire Common Shares (other than this Agreement, the Escrow Agreement and any other agreement executed and delivered in connection herewith), shall terminate and become null and void and ▇▇▇▇▇▇ shall have no further rights thereunder and that the Company and its subsidiaries are released from any obligation pursuant to such matters.

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[Signature Page Follows]

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

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

     The following executes this Agreement as the Sellers’ Representative solely to obtain the benefit of the indemnities provided to it in Section 15.22.

     The following executes this Agreement as the Management Representative solely to obtain the benefit of the indemnities provided to him in Section 15.23.

     The following executes this Agreement as the Sellers’ Representative solely to obtain the benefit of the indemnities provided to it in Section 15.22.

     The following executes this Agreement as the Management Representative solely to obtain the benefit of the indemnities provided to him in Section 15.23.