TECHNOLOGY SUB-LICENCE AGREEMENT (US)
THIS
AGREEMENT,
is
dated for reference January 31, 2008 and is made:
BETWEEN:
FORTRESS
PAPER LTD.,
a
corporation organized under the laws of British Columbia having an office at
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("SubLicensor")
AND:
IDCENTRIX
INC.,
a
corporation organized under the laws of Delaware having an office at Suite
4240,
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇., ▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇
("SubLicensee")
WHEREAS:
A. Owner
(as
defined herein) is the sole owner of the intellectual property underlying the
Licensed Products (as defined herein) as embodied by the Licensed Technology
(as
defined herein);
B. Owner
has, pursuant to: (a) the Master Licence Agreement (as defined herein); (b)
a
subsequent assignment agreement between SubLicensor and Fortress Identification
Cards Ltd. dated April 24, 2007; and (c) a subsequent vertical amalgamation
of
Fortress Identification Cards Ltd. into SubLicensor, granted SubLicensor a
right
to sublicense the use of the Licensed Technology to manufacture and sell the
Licensed Products;
C. SubLicensor
wishes to sublicense to SubLicensee and SubLicensee wishes to sublicense from
SubLicensor, the right to use the Licensed Technology to manufacture and sell
Licensed Products in the Territories (as defined herein) subject to and in
accordance with the terms and conditions set forth in this
Agreement;
D. The
parties have simultaneously herewith entered into an amended and restated
sub-licence agreement dated January 31, 2008 relating to the sub-licensing
of
the intellectual property underlying the Licensed Products in Canada on an
exclusive basis (the "Canadian
SubLicence").
NOW
THEREFORE THIS AGREEMENT WITNESSES
that in
consideration of the premises, mutual covenants and agreements herein contained
and other good and valuable consideration (the receipt and sufficiency of which
are hereby acknowledged), the parties covenant and agree as
follows:
ARTICLE
1
DEFINITIONS
Unless
the context requires otherwise, the following terms shall have the meanings
set
out below when used in this Agreement.
1.1 "Claw-back
Event"
shall
have the meaning ascribed to it in Section 8.2(a).
1.2 "Claw-back
Shares"
shall
have the meaning ascribed to it in Section 8.2(b).
1.3 "Effective
Date"
means
the date of this Agreement.
1.4 "Infringement
Losses"
means
any and all claims, losses, liabilities, damages, judgments, awards or expenses
(including reasonable attorney's fees) incurred by SubLicensee, relating to,
in
connection with or in any way arising from any action, suit or proceeding
alleging that the Licensed Technology infringes the rights of any third party
in
the Territories.
1.5 "Licensed
Information"
means
any and all technical information, data, formulae, know-how, knowledge,
processes and/or trade secrets developed (or acquired) at anytime and from
time
to time by Owner or any of its Subsidiaries relating to the design, testing
and
manufacture of Licensed Products.
1.6 "Licensed
Patents"
means
the patents and/or patent applications listed in Schedule A relating to the
Licensed Products and all Owner Improvement Patents (and their foreign
counterparts, if any) and any divisions, extensions, continuations or
continuations-in-part thereof. Schedule A will be updated from time to time,
but
no less frequently than once every twelve (12) months to include all Owner
Improvement Patents or Sublicensee Improvements which have become subject to
the
licence granted to SubLicensee pursuant to Section 2.2 hereof in accordance
with
the provisions of this Agreement.
1.7 "Licensed
Products"
means
the "LQard I" and "LQard II" security cards and any related or ancillary
products owned by the Owner or any of its Subsidiaries.
1.8 "Licensed
Technology"
means
the Licensed Information and the Licensed Patents.
1.9 "LQ Branding"
means
the logos, trade names, trademarks and service marks of the Owner and the
SubLicensor now existing or hereafter established, whether registered or
unregistered, acquired or developed.
1.10 "Master
Licence Agreement" means
the
technology licence agreement dated April 24, 2007 between the Owner and
SubLicensor.
1.11 "Owner"
means
Landqart AG, a company formed under the laws of Switzerland.
2
1.12 "Owner
Improvement Patents"
means
all patents licensable at any time by Owner or any of its Subsidiaries which
are
derived from or constitute improvements to the Licensed Patents and/or the
Licensed Information.
1.13 "Primary
Territory"
means
the United States of America and Mexico.
1.14 "Public
Company"
means a
company, partnership, trust or any other entity that is permitted to offer
any
of the classes of its securities for sale to the general public in any country
or seeks to obtain a listing or a quotation of its securities on an exchange
or
quotation system in North America or internationally.
1.15 "Secondary
Territory"
means
worldwide, excluding the Primary Territory, Canada, Switzerland and
Africa.
1.16 "Sterling
Gold"
means
Sterling Gold Corp., a company organized under the laws of Nevada, the shares
of
common stock of which are quoted on the Over-the-Counter Bulletin Board in
the
United States under the symbol "SGCO".
1.17 "SubLicensee
Improvements"
means
any and all improvements on any of the Licensed Technology, designed, made
or
the ownership of which is acquired, by SubLicensee during the term of this
Agreement.
1.18 "Subsidiary"
means a
corporation, company or other entity:
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(a)
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more
than fifty percent (50%) of whose outstanding shares or securities
(representing the right to vote for the election of directors or
other
managing authority) are, now or hereafter, owned or controlled, directly
or indirectly, by a party hereto, but such corporation, company or
other
entity shall be deemed to be a Subsidiary only so long as such ownership
or control exists; or
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(b)
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which
does not have outstanding shares or securities, as may be the case
in a
partnership, joint venture or unincorporated association, but more
than
fifty percent (50%) of whose ownership interest representing the
right to
make the decisions for such corporation, company or other entity
is, now
or hereafter, owned or controlled, directly or indirectly, by a party
hereto, but such corporation, company or other entity shall be deemed
to
be a Subsidiary only so long as such ownership or control
exists.
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1.19 "Term"
shall
have the meaning given to it in Section 6.1.
1.20 "Territories"
means
the Primary Territory and the Secondary Territory collectively.
ARTICLE
2
SUBLICENCE
GRANTS
2.1 Sublicence
to use Licensed Information.
SubLicensor hereby grants to SubLicensee, to the extent that it has a right
to
do so:
3
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(a)
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a
personal, royalty-free, exclusive and non-transferable right and
sublicence to use and to sublicense others to use within the Primary
Territory only, the Licensed Information to: (i) make and have made
Licensed Products for use or sale exclusively within the Primary
Territory; and (ii) use any apparatus required to manufacture and
use
Licensed Products in the Primary Territory; and
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(b)
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a
personal, royalty-free, non-exclusive and non-transferable right
and
sublicence to use and to sublicense others to use within the Secondary
Territory only, the Licensed Information to: (i) make and have made
Licensed Products for use or sale exclusively within the Secondary
Territory; and (ii) use any apparatus required to manufacture and
use
Licensed Products in the Secondary
Territory.
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2.2 Sublicence
to use Licensed Patents. SubLicensor
hereby grants to SubLicensee, to the extent that it has a right to do
so:
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(a)
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a
personal, royalty-free, exclusive and non-transferable right and
sublicence to use and to sublicense others to use, within the Primary
Territory only, the Licensed Patents to make and have made Licensed
Products for use or sale exclusively within the Primary Territory;
and
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(b)
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a
personal, royalty-free, non-exclusive and non-transferable right
and
sublicence to use and to sublicense others to use, within the Secondary
Territory only, the Licensed Patents to make and have made Licensed
Products for use or sale exclusively within the Secondary
Territory.
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The
foregoing sublicences shall not extend to any infringement of Owner's patents
not sublicensed hereunder resulting from the combination of Licensed Products
with other products not sublicensed herein.
2.3 Additional
Patents. In
the
event that SubLicensee identifies in writing to SubLicensor any patents,
licensable by SubLicensor, which are necessarily infringed by SubLicensee's
exercise of the licenses granted in Sections 2.1
and
2.2,
and
SubLicensor, after a good faith analysis, agrees with SubLicensee's position,
then upon SubLicensor's written notification, Schedule A shall be automatically
amended to include such additional patents without further consideration payable
by SubLicensee. SubLicensor agrees to exercise any rights it may have pursuant
to Section 2.6 of the Master Licence Agreement to the extent necessary to allow
it to comply with the provisions of this Section 2.3.
In the
event that SubLicensor shall determine for any reason that such infringement
will not occur as to a licensable SubLicensor patent, SubLicensor shall
thereafter be estopped from making any claims of infringement against
SubLicensee, its Subsidiaries or its customers as to such SubLicensor patent
for
any exercise by SubLicensee of its rights under Section 2.1
and
2.2.
2.4 Payment
of Shares. In
consideration of the sublicences granted herein, SubLicensee shall issue to
SubLicensor 6,500,000 fully paid and non-assessable common shares of SubLicensee
(the "Shares") and shall deliver to SubLicensor, on or before the Effective
Date, a share certificate representing the Shares registered in the name of
SubLicensor.
SubLicensor represents and warrants that it is acquiring the Shares solely
for
investment for its own account and not with a view to any distribution of the
Shares. SubLicensor acknowledges that the Shares have not been registered under
the United States Securities Act of 1933 (the “1933 Act”) and constitute
"restricted securities" within the meaning of Rule 144 under the 1933 Act.
SubLicensor covenants that it will not sell or otherwise transfer the Shares
in
the United States except pursuant to an effective registration statement under
the 1933 Act or in a transaction which qualifies as an exempt transaction under
the 1933 Act and the rules and regulations promulgated thereunder (in the case
of any such exempt transaction, as evidenced by a written opinion of counsel
to
SubLicensor of reputable standing in a form reasonably satisfactory to
SubLicensee). SubLicensor acknowledges that all certificates representing the
Shares may have endorsed therein an appropriate legend reflecting the foregoing
restrictions.
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2.5 Registration
Rights.
It is a
condition precedent to the effectiveness of this Agreement that a registration
rights agreement relating to the Shares and the shares issued to SubLicensor
by
SubLicensee pursuant to the Canadian SubLicence (and any shares of Sterling
Gold
for which the Shares or the shares issued to SubLicensor by SubLicensee pursuant
to the Canadian SubLicence may be exchanged) substantially in the form attached
hereto as Schedule "B" be executed and delivered by Sterling Gold, SubLicensee
and SubLicensor on or before the Effective Date.
2.6 Financing.
It is a
condition precedent to the effectiveness of this Agreement that SubLicensee
has
completed a private placement of at least 2,666,666 shares of SubLicensee's
common stock at a subscription price of $0.75 per share on or before the
Effective Date.
2.7 No
Other Rights.
Except
as specifically granted in this Article
2,
this
Agreement does not grant any other sublicences or other rights, either directly
or indirectly, by implication, estoppel or otherwise, to SubLicensee with
respect to any of Owner’s or SubLicensor's patents or patent applications,
trademarks, copyrights, trade secrets, computer programs, know-how or other
intellectual property rights. For greater certainty, this Agreement does not
constitute a sale, assignment or transfer of the Licensed Patents or the
Licensed Information or any part thereof to SubLicensee or any other
party.
2.8 Reduction
of Secondary Territory.
SubLicensor may, at any time after the first anniversary of the date of this
Agreement, provide a written notice to SubLicensee indicating that the
SubLicensor wishes to grant an exclusive sublicence to a third party for a
particular country (the "Country") in the Secondary Territory. It is agreed
that
if SubLicensee fails to demonstrate to SubLicensor's satisfaction, acting
reasonably, that SubLicensee has used commercially reasonable efforts to sell,
distribute and promote the Licensed Products in the Country during the sixty
(60) day period after receipt of such notice, notwithstanding any other
provision of this Agreement, the Country shall be excluded from the definition
of "Secondary Territory" and this Agreement shall
be
deemed to have been amended nunc
pro tunc.
ARTICLE
3
USE
RESTRICTIONS/CONDITIONS
3.1 Best
efforts to Sell/Distribute.
SubLicensee agrees to use its best efforts to manufacture, sell, distribute
and
promote the Licensed Products within the Primary Territory. SubLicensee
agrees to use commercially reasonable efforts to manufacture, sell, distribute
and promote the Licensed Products within the Secondary Territory.
5
3.2 Outsourcing
Manufacture.
It is
acknowledged and agreed that the licences granted to SubLicensee in Sections
2.1
and
2.2
include
the right to grant sublicences to third party manufacturers to the extent
necessary to enable such third party manufacturers to manufacture Licensed
Products for SubLicensee. The terms of any such sublicence to third party
manufacturers, however, shall be limited solely to the use of the Licensed
Information and Licensed Patents in connection with the manufacture of Licensed
Products for sale to SubLicensee and shall not permit such third party
manufacturer to use the Licensed Information or Licensed Products for any other
purpose or in connection with the production of any other products.
3.3 Territory.
SubLicensee acknowledges and agrees that the sublicences granted to it pursuant
to Article
2
may only
be exercised in connection with the manufacturing and selling of Licensed
Products within the Territories as set out herein.
3.4 No
Contest of IP.
SubLicensee agrees not to contest (a) the validity of the Licensed Technology,
or (b) the right, title or interest of the Owner or SubLicensor in and to the
Licensed Technology and further agrees not to aid others in doing so. This
Section 3.4
shall
survive the termination or expiry of this Agreement.
3.5 Improvements.
SubLicensee agrees to assign and transfer to Owner any and all SubLicensee
Improvements during the term of this Agreement and SubLicensee shall transfer
to
Owner any and all papers or other materials necessary or proper to vest in
Owner
title to the SubLicensee Improvements and such SubLicensee Improvements shall
then become part of and be treated as Licensed Technology under this Agreement.
SubLicensor shall grant to SubLicensee, to the extent that it has a right to
do
so, a royalty-free, personal, exclusive and non-transferable right to use,
make
and sell and to sublicense others to use,
make
and sell products embodying the SubLicensee Improvements in the Primary
Territory, and a royalty-free, personal, non-exclusive and non-transferable
right to use, make and sell and to sublicense others to use, make and sell
products embodying the SubLicensee Improvements in the Secondary Territory,
and
hereby agrees to use all commercially reasonable efforts to obtain such right
in
order to make such grants. The parties recognize and acknowledge that
SubLicensee intends to design, manufacture, sell and distribute additional
products in the same categories as the Licensed Products. Accordingly, the
parties understand and confirm that all formulae, methods, processes,
techniques, designs, models, construction, product components and materials,
whether or not patentable, originating with SubLicensee in connection with
the
design, manufacture, sale or distribution of such additional products and not
in
connection with the Licensed Technology shall not be subject to the provisions
of this Section 3.5
and
shall remain the sole and exclusive property of SubLicensee.
3.6 Co-operation.
Each
party hereto agrees to notify the other party promptly of each infringement
or
possible infringement of the Licensed Patents, as well as any facts which may
affect the validity, scope or enforceability of the Licensed Patents of which
such party becomes aware. SubLicensor and SubLicensee covenant with each other
to co-operate in all reasonable ways in a prompt and timely fashion in the
prosecution of any infringement suit by the Owner, SubLicensor or SubLicensee
and in any defence of any action, suit or proceeding instituted for the
impeachment of or for a declaration of infringement of the Licensed Patents.
SubLicensee covenants and agrees to co-operate with and assist Owner, at Owner's
expense, in the Owner's prosecution of patent, trademark and copyright
applications in connection with the Licensed Products.
In the
event that either SubLicensor or Owner concludes not to seek prosecution or
ceases to prosecute any complaint in connection with the Licensed Patents or
the
Licensed Products (a “Proceeding”), then SubLicensor or Owner shall notify
SubLicensee in writing of such conclusion, and thereafter, if SubLicensee so
elects by written notice to SubLicensor, SubLicensor shall permit SubLicensee
to
prosecute such Proceeding, at SubLicensee’s sole cost and expense. Any benefits
and/or damages awarded pursuant to SubLicensee’s prosecution shall be for the
sole benefit of SubLicensee and neither of SubLicensor nor Owner shall be
entitled to any benefits and/or such award.
6
3.7 No
Technical Assistance.
SubLicensee agrees that there are to be no training, technical assistance or
other services provided under this Agreement by SubLicensor in relation to
the
Licensed Products except where such services are rendered through any further
written agreement between the parties, and in that case, at a fee to be agreed
upon at the time the further written agreement may be entered into.
3.8 Sublicensing
of Technology.
SubLicensee shall ensure that any sublicensing of the Licensed Technology be
subject to terms no less restrictive or less protective of SubLicensor's rights
relating to the Licensed Technology than this Agreement.
3.9 Public
Issuer. SubLicensee
shall seek and obtain SubLicensor's written consent, which may not be
unreasonably withheld, prior to becoming or seeking to become a Public Company.
3.10 Supply
of Materials.
SubLicensee shall source and purchase at reasonable prevailing market rates
all
security-related materials for the production of the Licensed Products in the
Territories, including, but not limited to, security paper, security ink and
polymer pouches from SubLicensor and/or Owner pursuant to the terms and
conditions of a supply agreement to be negotiated between the parties in good
faith, acting reasonably.
It is
acknowledged and agreed that the supply agreement shall contain a provision
providing that in any country where SubLicensor licenses the Licensed Technology
to SubLicensee on a non-exclusive basis, SubLicensee shall be entitled to the
same prevailing market rates as those offered to preferred customers of
SubLicensor in the applicable country. It is further acknowledged and agreed
that a single supply agreement in conformance with the foregoing requirements
shall satisfy the requirements of both this Section 3.10
and the
analogous provision, Section 3.10, of the Canadian SubLicence.
3.11 Supply
of Equipment.
SubLicensee shall lease or purchase all security-related equipment or apparatus
required for the production of the Licensed Products, including, but not limited
to, "Fusinator" machines from SubLicensor, or at SubLicensor's discretion,
the
Owner, pursuant to the terms and conditions of agreements to be negotiated
between the parties in good faith from time to time, acting reasonably.
SubLicensee shall use all commercially reasonable efforts (including, if
necessary and where available, commercial recordings in the case of leases)
to
ensure that "Fusinator" machines leased or sold to its customers are subject
to
recovery in the event that the lessee or buyer is unable to satisfy the security
and confidentiality obligations relating to such machines as may be imposed
by
SubLicensor or Owner from time to time.
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3.12 Non-Compete.
Neither
SubLicensor nor any of its Subsidiaries shall, either directly or indirectly,
in
any manner whatsoever, including either individually or in partnership or
jointly, or in conjunction, with any other person or persons, as principal,
agent, shareholder, employee, investor, creditor, director, officer or otherwise
or in any other manner whatsoever, directly or indirectly carry on, engage
in,
be interested in, be concerned with, advise, lend to, guarantee the obligations
of or otherwise have a financial interest in, any business which manufactures,
sells and/or distributes products which are substantially similar to or compete
with the Licensed Products in the Primary Territory during the Term of this
Agreement.
3.13 Research
and Development.
SubLicensor and SubLicensee will work together in good faith to actively
coordinate their research and development activities with respect to the
Licensed Products (the "R&D Activities") during the initial five (5) years
of the Term and will work in good faith to negotiate and enter into a research
and development agreement with respect thereto. The contemplated research and
development agreement will establish a coordinated roadmap and agenda for the
parties' R & D Activities. SubLicensee will commit to expend an aggregate of
at least $800,000 on R&D Activities during the first two (2) years of the
research and development agreement and an aggregate of at least $2,000,000
(including the $800,000 referred to above) during the five (5) year term of
the
research and development agreement. SubLicensee shall have the right, in its
sole discretion, to conduct the R&D Activities directly, through third party
contractors or by agreement with Owner; provided that any such contract with
a
third party will be consistent with the terms of this Agreement. It is
anticipated that the research and development agreement, including SubLicensee’s
funding commitment set forth above, will be terminated if this Agreement is
terminated for any reason, other than a breach hereof by SubLicensee or the
termination of this Agreement by SubLicensee pursuant to Section 6.3.
It is
acknowledged and agreed that a single research and development agreement in
conformance with the foregoing requirements shall satisfy the requirements
of
both this Section 3.13
and the
analogous provision, Section 3.13, of the Canadian SubLicence.
ARTICLE
4
BRANDING
4.1 LQ
Branding - Conditions of Use.
SubLicensee acknowledges and agrees that: (i) the LQ Branding are and shall
remain the sole property of Owner and/or SubLicensor, (ii) nothing in this
Agreement or elsewhere shall confer upon SubLicensee any right of ownership
in
the LQ Branding, and (iii) it shall not now or in the future contest the
validity of the LQ Branding. The Owner and SubLicensor do not hereby grant
a
licence or authorize in any way whatsoever SubLicensee to use the LQ Branding,
and any proposed use of the LQ Branding (or any portion thereof) must be
approved in writing by the Owner and the SubLicensor prior to such
use.
ARTICLE
5
CONFIDENTIALITY
5.1 Protection
of Confidential Information.
Commencing as of the Effective Date and continuing until a period of ten (10)
years from the date that this Agreement is terminated, SubLicensee agrees to
use
the same degree of care and discretion, but at least a reasonable level of
care
and discretion, to avoid any disclosure, publication, or dissemination of any
part or all of the Licensed Information outside of SubLicensee, as SubLicensee
employs with information of its own which it regards as confidential and which
it does not desire to publish, disclose or disseminate. If any Licensed
Information of a third party requires a different standard of care and such
standard of care requirement is clearly delineated in writing with respect
to
such Licensed Information within thirty (30) days of the disclosure of such
Licensed Information, SubLicensee agrees to protect such third party's Licensed
Information in accordance with the terms of the agreement under which such
information was received by SubLicensor.
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5.2 Exemptions.
Disclosure of Licensed Information shall not be precluded, if such disclosure
is:
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(a)
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in
response to a valid order of a court or other governmental body;
provided,
however, that SubLicensee shall first have given notice to SubLicensor
and
made a reasonable effort to obtain a protective order requiring that
the
information and/or documents so disclosed be used only for the purposes
for which the order was issued;
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(b)
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otherwise
required by law;
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(c)
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reasonably
necessary to establish rights under this Agreement (but only to the
extent
necessary to do so);
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(d)
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reasonably
necessary to exercise SubLicensee's sublicensed rights hereunder
and such
disclosure is made to an entity or other person that is bound as
to the
non-disclosure of such Licensed Information by a written agreement
that is
no less restrictive than this Article 5;
and
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(e)
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agreed
upon by prior written approval of the
discloser.
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5.3 No
Confidentiality Obligation.
No
obligation of confidentiality shall attach to:
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(a)
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any
information that SubLicensee already possesses, prior to the Effective
Date, without obligation of
confidentiality;
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(b)
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any
information SubLicensee rightfully receives from another person without
obligation of confidentiality;
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(c)
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any
information which is in the public domain, other than by way of breach
of
this Agreement;
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(d)
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any
information that is, or becomes, publicly available without breach
of this
Agreement; or
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(e)
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any
information received from a third party legally in a position to
provide
such information, provided, however that such information was not
obtained
by said third party directly or indirectly from the discloser under
an
obligation of confidentiality.
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ARTICLE
6
TERM,
TERMINATION AND ASSIGNMENT
6.1 Term.
This
Agreement shall become binding and effective when executed by the parties.
The
term of this Agreement shall start from the Effective Date and shall remain
in
effect until the date of expiration of the last patent to expire of the Licensed
Patents (the "Term"),
unless terminated earlier pursuant to the terms of this Agreement.
9
6.2 Cure
Period.
Notwithstanding anything else in this Agreement, if SubLicensee is in breach
of
its obligations hereunder and SubLicensor provides written notice to SubLicensee
specifying the nature of such breach, SubLicensee shall cure such breach within
sixty (60) days after such written notice. If SubLicensee fails to cure the
breach within sixty (60) days, SubLicensor shall have the right to terminate
this Agreement by giving written notice of termination to
SubLicensee.
6.3 Termination
by SubLicensee.
Notwithstanding anything else in this Agreement, SubLicensee shall have the
right to terminate this Agreement at any time upon giving written notice of
termination to SubLicensor no less than ninety (90) days prior to such
time.
6.4 Insolvency
of SubLicensee.
Notwithstanding Section 6.2,
and in
addition to the provisions set out in Section 6.2,
in the
event that SubLicensee engages in or suffers any of the following events of
default:
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(a)
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becomes
insolvent, is dissolved or liquidated, files or has filed against
it a
petition in bankruptcy, reorganization, dissolution or liquidation
or
similar action filed by or against it, is adjudicated as bankrupt,
or has
a receiver appointed for its business;
or
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(b)
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has
all or a substantial portion of its capital stock or assets expropriated
or attached by any government
entity,
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then
SubLicensee shall promptly notify SubLicensor in writing that such event has
occurred. If any default as specified above in this Section 6.4
is not
cured within ten (10) days after written notice from SubLicensor, SubLicensor
shall have the right to terminate this Agreement by giving written notice of
termination to SubLicensee.
6.5 Delay/Failure
to Terminate.
No
failure or delay on the part of SubLicensor in exercising its right of
termination hereunder for any one or more causes shall be construed to prejudice
its right of termination for such causes or any other or subsequent
causes.
6.6 Effect
of Termination.
Upon
termination of this Agreement, all sublicences granted under this Agreement
will
automatically terminate, and SubLicensee shall promptly return to SubLicensor
or
destroy all tangible information containing Licensed Information, provided
however, that in the event of expiration or earlier termination of this
Agreement for reasons other than a material breach by SubLicensee, SubLicensee
shall be entitled: (i) for a period of six (6) months from the date of such
termination or expiration, as the case may be, on a non-exclusive basis, to
continue to distribute and sell its then existing inventory of Licensed Products
in the Territories consistent with the terms and conditions of this Agreement;
and (ii) for a period of six (6) months from the date of such termination or
expiration, as the case may be, to fulfill its obligations under then existing
commitments with respect to which it has placed orders with Owner or SubLicensor
under the supply agreement contemplated by Section 3.10
hereof.
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6.7 Personal
Rights.
The
rights or sublicences granted herein are personal to the parties and, except
as
permitted by Section 12.2
hereof,
SubLicensee shall not assign, transfer, encumber or sublicense any of its rights
or privileges hereunder without the prior written consent of SubLicensor. Any
attempted act in derogation of the foregoing shall be considered
void.
6.8 Termination/Amendment
of Master Licence.
In the
event that the licence granted to SubLicensor under the Master Licence Agreement
is terminated for whatever reason, except as provided in Section 8.2,
this
Agreement shall immediately terminate and SubLicensor shall have no liability
to
SubLicensee arising from or related to the termination of this Agreement,
provided, however, that SubLicensor shall use commercially reasonable efforts
to
facilitate a direct sublicense agreement substantially in the form of this
Agreement between Owner and SubLicensee as applicable. Notwithstanding Section
11.2,
in the
event that any of the licences granted to SubLicensor under the Master Licence
Agreement is modified such that it is more restrictive than the corresponding
sublicence granted herein, such sublicence shall also be modified
accordingly.
6.9 SubLicensor
Remedies.
The
rights and remedies available to SubLicensor in this Article 6 are in addition
to, and do not limit, any and all remedies available to SubLicensor at law
or in
equity or pursuant to this Agreement.
ARTICLE
7
REPRESENTATIONS
AND WARRANTIES
7.1 SubLicensor
Representations and Warranties.
SubLicensor represents and warrants to SubLicensee as follows and acknowledges
that SubLicensee is relying on such representations and warranties in entering
into this Agreement:
|
(a)
|
Organization
and Power:
SubLicensor is a duly organized and validly existing company in good
standing under the laws of British
Columbia and has the power, authority and capacity to enter into
this
Agreement on the terms and conditions herein set forth and to carry
out
the transactions contemplated by this
Agreement;
|
|
(b)
|
Due
Authorization:
the execution and delivery of this Agreement and the consummation
of the
transactions contemplated hereunder have been duly authorized by
all
necessary action on the part of SubLicensor;
|
|
(c)
|
Enforceable
Agreement:
this Agreement has been duly executed and delivered by SubLicensor
and
constitutes a legal, valid and binding obligation of SubLicensor,
enforceable by SubLicensee against SubLicensor in accordance with
its
terms, subject to the availability of equitable remedies and the
enforcement of creditors' rights generally, specific performance,
injunctive relief and other equitable remedies granted in the discretion
of a court of competent jurisdiction, indemnity and related rights
under
applicable law and that provisions relating to severing unenforceable
provisions may be limited by applicable law;
and
|
|
(d)
|
No
Infringement:
to SubLicensor's knowledge, the Licensed Technology as used by SubLicensor
immediately prior to the Effective Date, does not infringe or make
unauthorized use of any intellectual property rights of any third
party
and none of Owner, SubLicensor or any of their respective Subsidiaries
has
received any notice of infringement or conflict with asserted rights
of
others with respect thereto.
|
11
7.2 SubLicensee
Representations and Warranties.
SubLicensee represents and warrants to SubLicensor as follows and acknowledges
that SubLicensor is relying on such representations and warranties in entering
into this Agreement:
|
(a)
|
Organization
and Power:
SubLicensee is a duly organized and validly existing company in good
standing under the laws of Delaware,
USA and
has the power, authority and capacity to enter into this Agreement
on the
terms and conditions herein set forth and to carry out the transactions
contemplated by this Agreement;
|
|
(b)
|
Due
Authorization:
the execution, delivery and performance by SubLicensee of its obligations
under this Agreement and the issuance, sale and delivery of the shares
delivered to SubLicensor pursuant to Section 2.4
by
SubLicensee:
|
|
(i)
|
have
been duly authorized by all necessary action on the part of
SubLicensee;
|
|
(ii)
|
do
not require the consent, approval, authorization, registration or
qualification of or with any governmental authority, stock exchange,
securities commission or other regulatory authority or other third
party,
except: (I) those which have been obtained; (II) those as may be
required
under applicable securities laws and will be obtained prior to the
Effective Date; or (III) those which have not been obtained and would
not
result in a material adverse effect on SubLicensee;
and
|
|
(iii)
|
do
not and will not (or will not with the giving of notice, the lapse
of time
or the happening of any other event or condition) result in a material
breach or a violation of, or conflict with or result in a default
under,
or allow any other person to exercise any rights under, any of the
terms
or provisions of the articles, by-laws or resolutions of the board
of
directors (or any committee thereof) or security holders of SubLicensee,
or any judgment, decree, order or award of any court, governmental
body or
arbitrator having jurisdiction over any of them, or any material
agreement, licence or permit to which any of them is a
party;
|
|
(c)
|
Enforceable
Agreement:
this Agreement has been duly executed and delivered by SubLicensee
and
constitutes a legal, valid and binding obligation of SubLicensee,
enforceable by SubLicensor against SubLicensee in accordance with
its
terms, subject to the availability of equitable remedies and the
enforcement of creditors' rights generally, specific performance,
injunctive relief and other equitable remedies granted in the discretion
of a court of competent jurisdiction, indemnity and related rights
under
applicable law and that provisions relating to severing unenforceable
provisions may be limited by applicable law;
|
12
|
(d)
|
Outstanding
Shares:
SubLicensee is authorized to issue 75,000,000 common shares of which,
as
of the Effective Date, 12,262,000 common shares were issued and
outstanding as fully paid and non-assessable shares of
SubLicensee;
|
|
(e)
|
Compliance
with Law:
SubLicensee has carried out its affairs in compliance in all material
respects with the terms and provisions of applicable law and is not
in
material violation of or in material default in the performance of
any
mortgage, note, indenture, deed of trust, contract, agreement (written
or
oral), instrument, lease, licence or other document to which it is
a party
or by which it is bound or to which its property or assets or any
of them
is subject;
|
|
(f)
|
Validly
Issued Shares:
the common shares to be issued pursuant to this Agreement have been,
or
prior to the Effective Date will be, duly created and, when issued,
delivered and paid for in full, will be validly issued as fully paid
common shares of SubLicensee, and will not have been issued in violation
of or subject to any pre-emptive rights or contractual rights to
purchase
securities issued by SubLicensee;
|
|
(g)
|
Financing
and RTO:
SubLicensee has completed a private placement of at least 2,666,666
shares
of SubLicensee's common stock at a subscription price of $0.75 per
share
concurrently with entering into this Agreement. Immediately after
entering
into this Agreement, SubLicensee shall complete a share exchange
agreement
with Sterling Gold pursuant to which all of the outstanding shares
of
common stock of SubLicensee will be exchangeable on a one-for-one
basis
for shares of Sterling Gold following which SubLicensee shall become
a
wholly owned subsidiary of Sterling Gold;
and
|
|
(h)
|
No
Claims:
SubLicensee has not received any written claims or written notice
from any
third party which might impact SubLicensee’s ability to perform its
obligations hereunder.
|
ARTICLE
8
INDEMNITY
AND LIMITATIONS OF LIABILITY
8.1 Indemnification
for Infringement Losses.
|
(a)
|
Any
provision of Section 3.6
or
Section 8.3
to
the contrary notwithstanding, SubLicensor will indemnify, defend
and hold
harmless SubLicensee from and against Infringement Losses incurred
by
SubLicensee from time to time in an aggregate amount up to, but not
in
excess of, $200,000. It is understood, acknowledged and agreed by
the
parties that the $200,000 amount referenced above in this Section
8.1(a)
is
an aggregate and cumulative limitation on: (i) SubLicensor’s obligation to
indemnify SubLicensee against Infringement Losses set forth in this
Section 8.1;
and (ii) SubLicensor's obligation to indemnify SubLicensee against
"Infringement Losses" (as such term is defined in the Canadian SubLicence)
pursuant to the terms of the Canadian
SubLicence.
|
13
|
(b)
|
SubLicensee
shall give notice to SubLicensor promptly, and in any event not later
than
twenty (20) days, after SubLicensee receives written notice of any
claim,
event or matter (an "Indemnification Claim") as to which SubLicensee
may
seek indemnity under paragraph (a) of this Section 8.1;
provided that the failure to give notice as provided in this paragraph
(b)
shall not relieve SubLicensor of its obligations under this Section
8.1
except to the extent that such failure prejudices the rights of
SubLicensor. In the event of any claim, action, suit, proceeding
or demand
asserted by any person who is not a party to this Agreement which
is or
gives rise to an Indemnification Claim, SubLicensor may elect to
assume
the defense of any such claim and SubLicensee shall have the right
to
participate in such defense at SubLicensee’s own expense, which shall
include counsel of its choice. If SubLicensor (1) elects not to defend,
compromise or settle an Indemnification Claim, or (2) having elected
to
defend an Indemnification Claim, fails to retain counsel to prosecute
the
action within thirty (30) days of such election, then in each case,
SubLicensee shall have the right to defend such claim at the risk
of
SubLicensor. SubLicensee shall not settle or compromise any
Indemnification Claim without the prior written consent of SubLicensor,
which consent shall not be unreasonably withheld and SubLicensor
shall not
settle or compromise any Indemnification Claim for an amount in excess
of
$200,000 without the prior written consent of SubLicensee, which
consent
shall not be unreasonably withheld.
|
8.2 Claw-back.
|
(a)
|
Any
provision of Sections 6.8,
8.3
or
8.5
to
the contrary notwithstanding, in the event that, prior to January
31,
2012, (i) this Agreement shall be terminated by reason of the termination
of the Master Licence Agreement and is not replaced by a direct licence
between Owner and SubLicensee in substantially the form of this Agreement,
as applicable or (ii) SubLicensee is prevented from practicing or
utilizing the Licensed Technology in the Primary Territory by reason
of
any infringement by the Licensed Technology of the rights of third
parties
(either of such events, a “Claw-back Event”), SubLicensor will convey to
SubLicensee a number of Claw-back Shares (as defined in paragraph
(b)
below) determined in accordance with the following
schedule:
|
|
(i)
|
if
the Claw-back Event occurs prior to January 31, 2009, 6,500,000 Claw-back
Shares;
|
|
(ii)
|
if
the Claw-back Event occurs on or after January 31, 2009, but prior
to
January 31, 2010, 6,000,000 Claw-back
Shares;
|
|
(iii)
|
if
the Claw-back Event occurs on or after January 31, 2010, but prior
to
January 31, 2011, 4,000,000 Claw-back Shares;
and
|
|
(iv)
|
if
the Claw-back Event occurs on or after January 31, 2011, but prior
to
January 31, 2012, 2,000,000 Claw-back
Shares.
|
For
greater certainty, the Claw-back Event shall only be a one time
occurrence.
14
|
(b)
|
As
used in this Section 8.2,
“Claw-back Shares” means shares of common stock of SubLicensee or any
shares or other securities of SubLicensee or any third party into
which
the common stock of SubLicensee may have been converted or for which
shares of common stock of SubLicensee may have been exchanged as
a result
of any transaction occurring on or after the date hereof and prior
to
January 31, 2012. The respective numbers of Claw-back Shares set
forth in clauses (i) through (iv) of paragraph (a) of this Section
8.2
shall be appropriately and proportionately adjusted to reflect any
stock
splits, reverse stock splits, conversions or exchanges or other capital
adjustments which may have occurred with respect to the Claw-back
Shares,
including applicable conversion and exchange
ratios.
|
|
(c)
|
It
is understood, acknowledged and agreed by the parties that the liability
pertaining to the conveyance of the Claw-back Shares referenced in
Section
8.2(a)
is
a one-time occurrence limitation on: (i) SubLicensor’s obligation to
convey the Claw-back Shares to SubLicensee in the event of the occurrence
of a Claw-back Event pursuant to the terms of this Agreement; and
(ii)
SubLicensor's obligation to convey the Claw-back Shares to SubLicensee
in
the event of the occurrence of a "Claw-back Event" (as such term
is
defined in the Canadian SubLicence) pursuant to the terms of the
Canadian
SubLicence. For greater certainty, the occurrence of a Claw-back
Event or
a "Claw-back Event" (as defined in the Canadian SubLicence) shall
result
in only a single conveyance of Claw-back Shares in accordance with
the
schedule set forth in Section 8.2(a)
and shall not be duplicative with any similar liability or obligation
contained in the Canadian
SubLicence.
|
8.3 No
Warranties.
Nothing
in this Agreement is or shall be construed as: (i) a warranty or representation
by SubLicensor as to the validity or scope of the Licensed Patents; (ii) any
warranty or representation by SubLicensor that anything made, used, sold or
otherwise disposed of under any sublicence granted in this Agreement is or
will
be free from infringement of patents, trademarks, copyrights and other rights
of
third parties; (iii) an obligation on the part of SubLicensor to bring or
prosecute actions or suits against third parties for infringement; or (iv)
granting by implication, estoppel or otherwise any licenses or sublicenses
other
than the Licensed Patents defined in this Agreement, regardless of whether
such
patents are dominant or subordinate to the Licensed Patents. EXCEPT AS EXPRESSLY
SET FORTH IN THIS AGREEMENT, SUBLICENSOR MAKES NO REPRESENTATIONS AND EXTENDS
NO
WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED. THERE ARE NO EXPRESS OR
IMPLIED WARRANTIES OF MERCHANTABILITY, DURABILITY, TITLE OR FITNESS FOR A
PARTICULAR PURPOSE, OR THAT THE USE OF THE LICENSED PRODUCTS OR THEIR PROCESS
OF
MANUFACTURE WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK OR OTHER RIGHTS.
Any warranty made by SubLicensee to its customers, users of the Licensed
Products or any third parties are made by SubLicensee alone and shall not bind
SubLicensor or be deemed or treated as having been made by SubLicensor and
service of any such warranty shall be the sole responsibility of
SubLicensee.
8.4 No
Special Damages.
IN NO
EVENT WILL SUBLICENSOR OR OWNER BE LIABLE FOR SPECIAL, INDIRECT, INCIDENTAL
OR
CONSEQUENTIAL DAMAGES WHICH SUBLICENSEE MAY INCUR OR EXPERIENCE ON ACCOUNT
OF
ENTERING INTO OR RELYING UPON THIS AGREEMENT EVEN IF SUBLICENSOR OR OWNER HAVE
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
15
8.5 Limitation
of Liability. EXCEPT
AS
OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, SUBLICENSOR’S OR OWNER’S
LIABILITY FOR CLAIMS, COSTS, LOSSES, DAMAGES, OF ANY KIND OR ANY OTHER CAUSE,
INCLUDING BUT NOT LIMITED TO LIABILITY FOR ANY FUNDAMENTAL BREACH OF THIS
AGREEMENT AND REGARDLESS OF THE FORM OF ACTION, SHALL NOT EXCEED $500; PROVIDED,
THAT SUCH $500 LIMITATION SHALL NOT APPLY IN THE EVENT THAT SUBLICENSOR SHALL
(i) BREACH ITS OBLIGATIONS UNDER SECTIONS 8.1
OR
8.2
HEREOF
OR (ii) WILFULLY TERMINATE THIS AGREEMENT OR OTHERWISE WILLFULLY REFUSE TO
OBSERVE ITS OBLIGATIONS HEREUNDER, ACTING IN BAD FAITH.
ARTICLE
9
COMMUNICATIONS
9.1 Mode
of Payment and Communication.
All
payments due after the Effective Date shall be made by electronic funds
transfer. Any notice or other communication required or permitted to be made
or
given to either party hereto pursuant to this Agreement shall be sent to such
party by facsimile or by registered airmail (except that registered or certified
mail may be used where delivery is in the same country as mailing), postage
prepaid, addressed to it at its address set forth below, or to such other
address as it shall designate by written notice given to the other party.
Payments shall be deemed to be made on the date of electronic funds transfer.
Notices or other communications shall be deemed to have been given or provided
on the date of sending. The addresses are as follows:
|
(a)
|
If
to SubLicensor:
|
Fortress
Paper Ltd.
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇
▇▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
with
a
copy to:
Sangra
Moller LLP
Barristers
& Solicitors
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇
▇▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇ ▇▇▇
16
|
(b)
|
if
to SubLicensee:
|
iDcentrix
Inc.
Suite
4240, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Chief Executive Officer
ARTICLE
10
APPLICABLE
LAW AND VENUE
10.1 Governing
Law.
This
Agreement shall be construed, interpreted and enforced in accordance with,
and
the respective rights and obligations of the parties hereto shall be governed
by, the laws of the Province of British Columbia and the federal laws of Canada
applicable therein without giving effect to any choice or conflict of law
provision or rule (whether of the Province of British Columbia or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the laws of the Province of British Columbia and the federal laws
of
Canada applicable therein.
10.2 Venue.
Each of
the parties consents to the exclusive jurisdiction of any court of competent
jurisdiction located within the Province of British Columbia. Each of the
parties hereby: (i) waives trial by jury, (ii) waives any objection to venue
of
any action instituted hereunder and (iii) consents to the granting of such
legal
or equitable relief as is deemed appropriate by any aforementioned court.
Notwithstanding the foregoing, SubLicensor shall have the right to commence
and
prosecute any legal or equitable action or proceeding before any court of
competent jurisdiction to obtain injunctive or other relief in the event that,
in the opinion of SubLicensor, such action is necessary or
desirable.
ARTICLE
11
INTERPRETATION
11.1 Promotional
Rights.
Nothing
contained in this Agreement shall be construed as conferring any right to use
in
advertising, publicity, or other promotional activities any name, trade name,
trademark, trade dress or other designation of either party hereto (including
any contraction, abbreviation or simulation of any of the foregoing), save
as
expressly stated herein. Each party hereto agrees not to use or refer to this
Agreement or any provision hereof in any promotional activity associated with
apparatus sublicensed hereunder, without the express written approval of the
other party.
11.2 Entire
Agreement.
No
amendment or modification hereof shall be valid or binding upon the parties
unless made in writing and signed by both parties. This Agreement embodies
the
entire understanding of the parties with respect to the subject matter hereof
and supersedes all prior and contemporaneous written or oral negotiations and
agreements between them regarding the subject matter hereof, and neither of
the
parties shall be bound by any conditions, definitions, warranties,
understandings or representations with respect to the subject matter hereof
other than as expressly provided herein.
11.3 Currency.
All
references to currency in this Agreement are to US dollars unless otherwise
stated.
17
11.4 Headings.
The
headings inserted herein are for convenience of reference only and are not
intended to be a part of or to affect the meaning of interpretation of this
Agreement.
11.5 Gender
and Number.
In this
Agreement, words importing the singular include the plural and vice versa;
and
words importing gender include all genders.
11.6 Survival.
Any
provision of this Agreement which expressly states it is to continue in effect
after termination or expiration of this Agreement, or which by nature would
survive the termination or expiration of this Agreement shall do so.
11.7 Joint
Participation.
The
parties have participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as drafted jointly by the parties
and
no presumption or burden of proof shall arise favoring or disfavoring any party
by virtue of the authorship of any of the provisions of this
Agreement.
ARTICLE
12
MISCELLANEOUS
12.1 Export/Re-export.
SubLicensee agrees not to export or re-export, or cause to be exported or
re-exported, any technical data received hereunder, or the direct product of
such technical data, to any country or person which, under the laws of the
United States or Canada, are or may be prohibited from receiving such technical
data or the direct product thereof.
12.2 Assignment.
Except
as provided herein, SubLicensee may not assign its rights and obligations under
this Agreement without the prior written consent of the SubLicensor, provided,
however, that SubLicensee may assign its rights and obligations hereunder to
any
Subsidiary or parent of SubLicensee. Despite any assignment, SubLicensee shall
remain bound by this Agreement and is liable for the performance or
non-performance of the assignee as if that performance or non-performance was
that of the SubLicensee itself. SubLicensor may perform all obligations to
be
performed under this Agreement directly or may have some or all obligations
performed by its contractor, subcontractor or affiliates.
12.3 Severability.
If any
part of this Agreement is found by competent authority to be invalid, illegal
or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such part in every other respect and the remainder of
this
Agreement shall continue in effect so long as the Agreement still expresses
the
intent of the parties. If the intent of the parties cannot be preserved, this
Agreement shall be either renegotiated or terminated.
12.4 Force
Majeure.
Neither
party shall be responsible for any failure to perform hereunder which is caused
by circumstances reasonably beyond the control of such party, including but
not
limited to Acts of God, war, riot, embargoes, fire, flood, earthquake(s),
strikes or labour shortages or acts of sabotage. This provision shall not be
construed as excusing non-performance of any obligation by either party to
make
payment to the other party under this Agreement.
18
12.5 Further
Assurances.
Each
party will, at its own expense, execute and deliver such further agreements
and
documents and do such further acts and things as may be reasonably required
to
give effect to this Agreement.
12.6 Enurement.
This
Agreement shall enure to the benefit of and shall be binding upon the parties
hereto and their respective successors and assigns.
12.7 Time
of Essence.
Time
shall be of the essence of this Agreement.
12.8 Counterparts.
This
Agreement may be executed in any number of counterparts with the same effect
as
if all parties had signed the same document. All counterparts will constitute
one and the same agreement. This Agreement may be executed and transmitted
by
facsimile transmission or electronic mail (including pdf) and if so executed
and
transmitted this Agreement will be for all purposes as effective as if the
parties had delivered an executed original Agreement.
IN
WITNESS WHEREOF,
the
parties hereto have caused this Agreement to be duly signed as of the date
first
written above.
|
FORTRESS
PAPER LTD.
|
IDCENTRIX
INC.
|
|||
|
By:
|
By:
|
|||
|
Name:
|
Name:
|
|||
|
Title:
|
Title:
|
|||
19
SCHEDULE
A
LICENSED
PATENTS
Patents
relating to LQard I
Regional
and national phase: United States application No.Q99837 "Identification Card
and
Method for the Production Thereof" 11/659,120
Patents
relating to LQard II
Regional
and national phase: United States application No.Q99836 "Identification Card
and
the Production Method Thereof" 11/659,119
SCHEDULE
B
FORM
OF REGISTRATION RIGHTS AGREEMENT
FORTRESS
PAPER LTD.
iDCENTRIX
INC.
REGISTRATION
RIGHTS AGREEMENT
dated
December [l],
2007
Sangra
Moller LLP
THIS
REGISTRATION RIGHTS AGREEMENT (this
"Agreement")
is
dated December [l],
2007,
among Sterling Gold Corp. (together with any successor entity, herein referred
to as the "Company"),
a
corporation organized pursuant to the laws of the State of Nevada, iDcentrix
Inc. ("iDcentrix"),
a
company organized pursuant to the laws of the State of Delaware and Fortress
Paper Ltd. ("Fortress"),
a
company organized pursuant to the laws of the Province of British
Columbia.
WHEREAS,
this Agreement is being entered into contemporaneously with the consummation
of
the transactions contemplated by (i) that certain Amended and Restated
Technology SubLicense Agreement, dated the date hereof, between Fortress and
iDcentrix (the "Restated
SubLicense"),
(ii)
that certain Technology SubLicense Agreement, dated the date hereof, between
Fortress and iDcentrix (the "SubLicense")
and
(iii) that certain Share Exchange Agreement, dated [the
date hereof],
among
the Company, iDcentrix, the shareholders of iDcentrix (including Fortress)
and
the Shareholders Representative (as defined therein) (the "Exchange
Agreement");
and
WHEREAS,
pursuant to the Restated SubLicense and the SubLicense, iDcentrix will have
issued to Fortress an aggregate of Ten Million (10,000,000) shares of the common
stock of iDcentrix; and
WHEREAS,
pursuant to the Exchange Agreement, Fortress will have exchanged the 10,000,000
shares of iDcentrix common stock issued to it pursuant to the Restated
SubLicense and the SubLicense for 10,000,000 shares of common stock of the
Company; and
WHEREAS,
the Company has agreed to provide the registration rights set forth in this
Agreement;
NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as
follows:
| 1. |
Definitions.
As
used in this Agreement, the following capitalized terms shall have
the
following meanings:
|
"Action" has
the
meaning set forth in Section 6(c) hereof.
"Affiliate" has
the
meaning set forth in Rule 405 under the Securities Act.
"Blue
Sky Application"
has the
meaning in Section 6(a) hereof.
"Broker-Dealer"
means
any broker or dealer registered under the Exchange Act.
"Business
Day"
means a
day other than a Saturday or Sunday or any federal holiday in the United States
or any holiday in the Province of British Columbia, Canada.
"Closing
Date" means l,
2007.
"Commission"
means
the Securities and Exchange Commission of the United States.
"Common
Stock"
means
the shares of common stock of the Company.
"Company"
has the
meaning set forth in the recitals hereto.
"Effectiveness
Deadline"
has the
meaning in Section 2(b) hereof.
B-2
"Effectiveness
Period"
has the
meaning in Section 2(c) hereof.
"Exchange
Act"
means
the United States Securities
Exchange Act of 1934,
as
amended.
"Exchange
Agreement"
has the
meaning set forth in the recitals hereto.
"Filing
Deadline" has
the
meaning in Section 2(a) hereof.
"Holders"
means
Fortress or its Affiliates who own, beneficially or of record, Transfer
Restricted Securities .
"Indemnified Holder"
has the
meaning in Section 6(a) hereof.
"NASD"
means
National Association of Securities Dealers, Inc.
"Notice
and Questionnaire"
means
the Selling Securityholder Notice and Questionnaire in substantially the form
attached as Exhibit A hereto.
"Person"
means
an individual, partnership, limited liability company, corporation,
unincorporated organization, trust, joint venture or a government or agency
or
political subdivision thereof.
"Prime
Rate"
means
the prime rate of interest charged by Royal Bank of Canada to its most
creditworthy customers for U.S. dollar or commercial loans at its main branch
in
Vancouver, British Columbia, from time to time.
"Prospectus"
means
the prospectus included in a Registration Statement, as amended or supplemented
by any prospectus supplement with respect to the terms of the offering of any
portion of the Transfer Restricted Securities covered by such Registration
Statement and by all other amendments thereto, including post-effective
amendments, and all material incorporated by reference into such
Prospectus.
"Restated
SubLicense"
has the
meaning set forth in the recitals hereto.
"Rule
144" means
Rule 144 under the Securities Act (or any successor provision), as it may be
amended from time to time.
"Securities
Act" means
the
United States Securities
Act of 1933,
as
amended.
"Shelf
Registration Statement" has
the
meaning set forth in Section 2(a) hereof.
"Sub-Licence
Agreement" has
the
meaning set forth in the recitals hereto.
"Suspension
Period"
has the
meaning in Section 4(b) hereof.
"Transfer
Restricted Securities" means
each share of Common Stock originally issued to Fortress pursuant to the
Exchange Agreement until the earliest to occur of:
|
(a)
|
the
date on which such share of Common Stock has been effectively registered
for resale under the Securities Act and disposed of in accordance
with the
Shelf Registration Statement;
|
B-3
|
(b)
|
the
date on which such share of Common Stock (A) has been transferred in
compliance with Rule 144(k) or (B) may be sold or transferred
pursuant to Rule 144(k) were it not held by an Affiliate of the Company
(or any other similar provision then in force);
and
|
|
(c)
|
the
date on which such share of Common Stock ceases to be outstanding
(whether
as a result of redemption, repurchase and cancellation, conversion
or
otherwise).
|
"Underwritten
Registration" or "Underwritten
Offering" means
a
registration in which securities of the Company are sold to an underwriter
for
reoffering to the public.
It
is
expressly understood by the parties hereto that in the event that the
Sub-Licence Agreement is terminated pursuant to its terms or the transactions
contemplated thereunder are not completed that this Agreement will be null
and
void and of no further force and effect.
| 2. |
Shelf
Registration.
|
|
(a)
|
The
Company shall use commercially reasonable efforts to prepare and,
as
promptly as practicable but in any event not later than 90 days
after:
|
|
(i)
|
the
Closing Date, file with the Commission a registration statement in
respect
of an aggregate of 2,500,000 of the Transfer Restricted
Securities;
|
|
(ii)
|
having
received a written request from the Holders, which request shall
not be
made prior to the first anniversary of the Closing Date, file with
the
Commission a further registration statement in respect of an additional
2,500,000 Transfer Restricted Securities over and above those referred
to
in (i) above;
|
|
(iii)
|
having
received a written request from the Holders, which request shall
not be
made prior to the second anniversary of the Closing Date, file with
the
Commission a further registration statement in respect of an additional
2,500,000 Transfer Restricted Securities over and above those referred
to
in (i) and (ii) above; and
|
|
(iv)
|
having
received a written request from the Holders, which request shall
not be
made prior to the third anniversary of the Closing Date, file with
the
Commission a further registration statement in respect of an additional
2,500,000 Transfer Restricted Securities over and above those referred
to
in (i), (ii) and (iii) above, (the date which is not later than 90
days
after each of the events referred to in (i) through (iv) above is
referred
to as a "Filing
Deadline")
|
for
an
offering to be made on a continuous basis pursuant to Rule 415 under the
Securities Act (the "Shelf
Registration Statements"),
covering the Transfer Restricted Securities issued to and held by the Holders
as
set out above. The Shelf Registration Statements shall be on Form S-3 under
the
Securities Act or, if Form S-3 is unavailable, on another appropriate form
permitting registration of such Transfer Restricted Securities for resale by
the
Holders in the manner or manners designated by them or permitted under
applicable law (including, without limitation, one or more underwritten
offerings).
B-4
The
Company shall use commercially reasonable efforts to cause the Shelf
Registration Statements to be declared effective by the Commission as soon
as
practicable after they are filed and, in any event, within 90 days after the
Filing Deadline for each such Shelf Registration Statement (the "Effectiveness
Deadline").
If
(i) (A) any of the Shelf Registration Statements required to be filed by the
Company pursuant to Section 2(a) hereof is not filed with the Commission prior
to the Filing Deadline or (B) any such Shelf Registration Statement covering
all
of the Transfer Restricted Securities is not declared effective by the
Commission on or before the Effectiveness Deadline due to the failure of the
Company to use commercially reasonable efforts to cause the Shelf Registration
Statement to be declared effective by the Commission, or (ii) if, after any
such
Shelf Registration Statement has been declared effective by the Commission,
sales of any of the Transfer Restricted Securities required to be covered by
such Shelf Registration Statement cannot be made pursuant to such Shelf
Registration Statement (by reason of a stop order or
the
Company's failure to update the Shelf Registration Statement or after the
30th
consecutive day in any 45-day period or the 45th
day in
any 365-day period, as the case may be, of any Suspension Period described
in
Section 4(b) hereof, or any other reason outside the control of the Holders)
and
the Company does not cause the Shelf Registration Statement to become effective
by a post-effective amendment or report filed with the Commission pursuant
to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act within five (5) Business
Days of the commencement of such suspension, or (iii) the Common Stock are
not
included for quotation on the Nasdaq Over- the -Counter Bulletin Board (the
"OTCBB")
at any
time after the Effectiveness Deadline hereunder (each of the items (i) and
(ii)
of this Section 2(a) is herein called a "Registration
Default"),
then
the Company will make payments to the Holders in such amounts and at such times
as shall be determined pursuant to this Section 2(a) as relief for the
damages to the Holders by reason of any such delay in or reduction of their
ability to sell the Transfer Restricted Securities as liquidated damages
("Default
Damages").
The
Company shall pay to each Holder as Default Damages an amount equal to the
number of Transfer Restricted Securities held by such Holder, multiplied by
a
deemed price of US$0.75 per Transfer Restricted Security, multiplied by a rate
equal to the Prime Rate plus 5% per annum, for each thirty (30) day period
(or
portion thereof) of a Registration Default. Default Damages shall accrue to
each
Holder on the Transfer Restricted Securities from and including the date on
which the Registration Default occurs up to but excluding the date on which
the
Registration Default has been cured provided however, Default Damages on
Transfer Restricted Securities shall not accrue under any more than one of
the
foregoing clauses (i) or (ii) above at any one time; provided further however
that (x) on the filing of the Shelf Registration Statement as required (in
case
of clause (i)(A) of this Section 2(a)), (ii) on the effectiveness of the Shelf
Registration Statement as required hereunder (in the case of clause (i)(B)
of
this Section 2(a)) or the quotation of the Common Stock on the OTCBB, Default
Damages on the Transfer Restricted Securities as a result of such clause (or
the
relevant subclause) as the case may be, shall cease to accrue. It is understood
and agreed that notwithstanding any provisions to the contrary Default Damages
shall cease to accrue on any Transfer Restricted Securities at the time that
such securities cease to be a Transfer Restricted Securities.
Notwithstanding
anything to the contrary, a Holder shall not be entitled to Default Damages
under this Section 2(a) if such Registration Default is attributable to changes
(other than corrections of the Company's mistakes respecting information
previously provided by the Holders) required to be provided by the Holders
in
the Shelf Registration Statement with respect to information relating to the
Holders, including, without limitation to the plan of distribution or if such
Holders have not provided all registration information to us as required in
Section 2(d) at least five (5) Business Days prior to the effective date of
Shelf Registration Statements or any subsequent amendment thereto (with respect
to any period subsequent to such amendment and prior to the next amendment
in
respect of which such information is provided to us). No Default Damages will
be
payable to Holders of securities purchased in transactions covered by the Shelf
Registration Statement or previously sold in transactions exempt from the
registration requirements of the Securities Act in accordance with Rule 144
(unless such Holders were assigned rights hereunder pursuant to Section 10(f)
hereof).
B-5
The
calculation of Default Damages hereunder will be determined on the basis of
a
360 day year comprised of twelve-30 months days and the actual number of days
on
which Default Damages accrued during such period.
The
Default Damages set forth above shall be the exclusive monetary remedy available
to the Holders of Transfer Restricted Securities for Registration Defaults.
In
addition to the foregoing, the Company shall not, without the Holders' prior
written consent (such consent to be given in the sole discretion of the
Holders), for the entire period that there is an uncured Registration Default,
file, or cause to be filed, any registration statement for its securities for
sale either for its own account or for the account of a third
party.
|
(b)
|
The
Company shall use its commercially reasonable efforts to keep the
Shelf
Registration Statements continuously effective in order to permit
the
Prospectus included therein to be lawfully delivered by the Holders
for a
period (the "Effectiveness
Period")
of two years from the Filing
Deadlines set out in Section 2(a) hereof or
such shorter period that will terminate when (i) all the Transfer
Restricted Securities have been sold pursuant to the Shelf Registration
Statements or (ii) none of the shares of Common Stock issued to the
Holders pursuant to the Exchange Agreement are Transfer Restricted
Securities. The Company shall be deemed not to have used its commercially
reasonable efforts to keep the Shelf Registration Statements effective
during the requisite periods if it voluntarily takes any action that
would
result in the Holders not being able to offer and sell such Transfer
Restricted Securities during the Effectiveness Period, unless such
action
is (i) required by applicable law or (ii) taken by the Company
in good faith and contemplated by Section 4(b) below, and the Company
thereafter complies with the requirements of Section
4(b).
|
Notwithstanding
the foregoing, the Company shall not be obligated to file a Prospectus with
the
securities commission or similar regulatory authority in any of the provinces
or
territories of Canada.
|
(c)
|
The
Company shall, at least 15 Business Days prior to the date on which
a
Shelf Registration Statement is filed, provide written notice to
each
Holder (which notice shall be accompanied by a copy of a Notice and
Questionnaire to be completed by such Holder) that the Company intends
to
file a Shelf Registration Statement pursuant to this Agreement and
that
the Holder must complete and return the enclosed Notice and Questionnaire
in accordance with this Section 2(c) in order to be named as a selling
securityholder in the Shelf Registration Statement and Prospectus.
The
Company shall include in a Shelf Registration Statement at the time
it is
first declared effective, the name of each Holder that provided a
Notice
and Questionnaire to the Company in accordance with this Section
2(c). If
the Company files a post-effective amendment to the Shelf Registration
Statement, the Company shall use commercially reasonable efforts
to cause
such post-effective amendment to be declared effective under the
Securities Act as promptly as is
practicable.
|
B-6
|
(d)
|
If
the Company’s Board of Directors, in its good faith judgment, determines
that any Shelf Registration should not be made or continued because
(i) it
would interfere with any material financing, acquisition, corporate
reorganization or merger, or other material transaction involving
the
Company or (ii) it would result in premature disclosure of a matter
the
Company’s Board of Directors has determined would not be in the best
interest of the Company to be disclosed at such time, the Company
may
postpone the filing of a registration statement or, in case a registration
statement has been filed, may cause such registration statement to
be
withdrawn, for up to 45 days; provided, however, that in no event
shall
the Company withdraw a Shelf Registration Statement after it has
been
declared effective. Notwithstanding the foregoing, for the duration
of any
such withdrawal or postponement period, the Company shall continue
to use
commercially reasonable efforts to prepare such Shelf Registration
Statement and any related materials so that the Company will be in
a
position to file such Shelf Registration Statement when the withdrawal
or
postponement shall have expired. The Company may defer the filing
of a
Shelf Registration Statement pursuant to this Section 2(d) hereof
only
once in any twelve month period.
|
|
(e)
|
The
Company will not grant to any Person the right, other than as set
forth
herein and except to directors or employees of the Company with respect
to
registrations on Form S-8 (or any successor forms thereto), to request
the
Company to register any securities of the Company except such rights
as
are not more favorable than or inconsistent with the rights granted
to the
Holders herein. In the event the Company grants rights which are
more
favorable, the Company will make such provisions available to the
Holders
and will enter into any amendments necessary to confer such rights
on the
Holders. No Person shall be permitted to exercise piggyback or similar
registration rights in any Shelf Registration Statement unless all
of the
shares of Transfer Restricted Securities permitted to be registered
therein by the Holders are included in such Shelf Registration
Statement.
|
|
3.
|
iDcentrix
Obligations
|
For
so
long as the Holders hold any Transfer Restricted Securities, iDcentrix
unconditionally guarantees the performance of the Company's obligations pursuant
to this Agreement and shall be liable to the Holders, jointly and severally
with
the Company, for any loss or damage arising from any breach or non-performance
of this Agreement by the Company, including without limitation, the Default
Damages.
|
4.
|
Registration
Procedures.
|
In
connection with any Shelf Registration Statement contemplated by Section 2
hereof, the Company shall:
|
(a)
|
use
commercially reasonable efforts to effect such registration to permit
the
sale of the Transfer Restricted Securities being sold in accordance
with
the intended method or methods of distribution thereof, and pursuant
thereto and in accordance with Section 2(a) hereof, shall prepare
and file
with the Commission a Shelf Registration Statement relating to the
registration on Form S-3, or if the Company is not then eligible
to use
Form S-3, on any appropriate form under the Securities
Act;
|
B-7
|
(b)
|
upon
the occurrence of any event or discovery of any facts of the kind
described in clauses (ii) through (iv) of Section 4(d) during the
Effectiveness Period, as promptly as practicable after the occurrence
of
such an event, use commercially reasonable efforts to ensure that
the use
of the Prospectus may be resumed, including, without limitation,
preparing
and filing a post-effective amendment to the Shelf Registration Statement
or an amendment or supplement to the Prospectus or any document
incorporated therein by reference and any other required document
so that,
as thereafter delivered to the Holders or purchasers of the shares
of
Common Stock covered thereby, neither the Shelf Registration Statement
nor
the Prospectus will contain an 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 the case of the Prospectus, in light
of
the circumstances under which they were made) not misleading.
Notwithstanding the foregoing, the Company may suspend the availability
of
the Shelf Registration Statement upon written notice to the Holders
(which
notice shall be accompanied by an instruction to suspend the use
of the
Prospectus), for one or more periods not to exceed 45 consecutive
days in any 90-day period, and not to exceed, in the aggregate,
90 days in any 365-day period (each such period, a "Suspension
Period")
if:
|
|
(i)
|
an
event occurs and is continuing that, in the Company's good faith
judgment,
would require the Company to make changes in the Shelf Registration
Statement or the Prospectus in order that the Shelf Registration
Statement
or the Prospectus does not 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 the case of the Prospectus,
in light of the circumstances under which they were made) not misleading;
|
|
(ii)
|
the
Company reasonably determines that the disclosure of such event at
such
time would have a material adverse effect on the business of the
Company
(and its subsidiaries, if any, taken as a whole);
|
|
(iii)
|
the
Company's directors and executive officers are also prohibited from
trading in the Company's securities during such Suspension Period;
and
|
|
(iv)
|
the
Company has suspended the availability of any other shelf registration
statement covering resales by third
parties.
|
|
(c)
|
prepare
and file with the Commission such amendments and post-effective amendments
to the Shelf Registration Statement as may be necessary to keep the
Shelf
Registration Statement effective during the Effectiveness Period
(which
may, to the extent applicable in compliance with the Securities Act,
be
effected by filings under the Exchange Act as contemplated by Item
12(b)
of Form S-3 under the Securities Act); cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented
to be filed pursuant to Rule 424 under the Securities Act, and to
comply
with the applicable provisions of Rules 424 and 430A under the Securities
Act in a timely manner; and comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by
the Shelf
Registration Statement during the applicable period in accordance
with the
intended method or methods of distribution by the Holders set forth
in the
Shelf Registration Statement or supplement to the
Prospectus;
|
|
(d)
|
notify
the Holders and the underwriter(s), if any, promptly (but in any
event
within five Business Days) and, if requested by such Persons, confirm
such
advice in writing:
|
|
(i)
|
when
the Shelf Registration Statement, the Prospectus or any amendment,
supplement or post-effective amendment thereto has been filed, and,
with
respect to the Shelf Registration Statement or any post-effective
amendment thereto, when the same has become
effective;
|
B-8
|
(ii)
|
of
any written request by the Commission for post-effective amendments
or
supplements to the Shelf Registration Statement or Prospectus or
for
additional information relating thereto after a Registration Statement
has
become effective;
|
|
(iii)
|
of
the issuance by the Commission of any stop order suspending the
effectiveness of the Shelf Registration Statement under the Securities
Act
or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering
or sale
in any jurisdiction, or the initiation of any proceeding for any
of the
preceding purposes; or
|
|
(iv)
|
of
the existence of any fact or the happening of any event, during the
Effectiveness Period, that makes any statement of a material fact
made in
the Shelf Registration Statement, the Prospectus, any amendment or
supplement thereto, or any document incorporated by reference therein
untrue, or that requires the making of any additions to or changes
in the
Shelf Registration Statement or the Prospectus in order to make the
statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not
misleading;
|
|
(e)
|
if
at any time the Commission shall issue any stop order suspending
the
effectiveness of the Shelf Registration Statement, or any state securities
commission or other regulatory authority shall issue an order suspending
the qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or Blue Sky laws, use
commercially reasonable efforts to obtain the withdrawal or lifting
of
such order at the earliest possible
time;
|
|
(f)
|
furnish
to the Holders and their respective counsel prior to the filing with
the
Commission, a copy of the Shelf Registration Statement, copies of
any
Prospectus included therein and copies of any amendments to the Shelf
Registration Statement or supplements to the Prospectus and each
Holder
shall have the opportunity to correct any information pertaining
to the
Holder that is contained therein and the Company will make the corrections
reasonably requested by such Holder with respect to such information
prior
to filing any such Shelf Registration Statement or amendment or supplement
thereto;
|
|
(g)
|
make
available at reasonable times for inspection by one or more
representatives of the Holders, any underwriter participating in
any
distribution pursuant to the Shelf Registration Statement, and any
attorney or accountant retained by the underwriter(s) and the respective
counsel of the Holders all financial and other records, pertinent
corporate documents and properties of the Company as shall be reasonably
necessary to enable them to exercise any applicable due diligence
responsibilities, and cause the Company's officers, directors, managers
and employees to supply all information reasonably requested by any
such
representative or representatives of the Holders, underwriter, attorney
or
accountant in connection with the Shelf Registration Statement after
the
filing thereof and before its effectiveness; provided, however, that
(i)
each such representative of the selling Holders (on its behalf and
on
behalf of its underwriter(s), attorneys and accountants) will be
required
to agree in writing to hold in confidence and not to use for any
purpose
other than to satisfy applicable due diligence responsibilities all
nonpublic information obtained by it as a result of such inspections
until
such is made generally available to the public through no fault of
such
representative of the Holders or their underwriter(s), attorneys
or
accountants of a selling Holder, and (ii) each selling Holder will be
required further to agree in writing that it will, upon learning
that the
disclosure of such records or information is sought in a court of
competent jurisdiction, or in connection with any action, suit or
proceeding, give notice to the Company and allow the Company at its
expense to undertake appropriate action to prevent disclosure of
the
records and information deemed
confidential;
|
B-9
|
(h)
|
if
reasonably requested by Holders or the underwriter(s), if any, promptly
incorporate in the Shelf Registration Statement or Prospectus, pursuant
to
a supplement or post-effective amendment if necessary, such information
as
such selling Holders and underwriter(s), if any, may request to have
included therein, including, without limitation: (i) information
relating
to the "Plan of Distribution" of the Transfer Restricted Securities;
(ii)
information with respect to the number of Common Stock being sold
to such
underwriter(s); (iii) the purchase price being paid therefor; and
(iv) any
other terms of the offering of the Transfer Restricted Securities
to be
sold in such offering; provided, however, that with respect to any
information requested for inclusion by the Holder, this clause (h)
shall
apply only to such information that relates to the Transfer Restricted
Securities to be sold by such Holder; and make all required filings
of
such Prospectus supplement or post-effective amendment as soon as
reasonably practicable after the Company is notified of the matters
to be
incorporated in such Prospectus supplement or post-effective
amendment;
|
|
(i)
|
furnish
to each Holder and each of the underwriter(s), if any, upon request,
without charge, at least one conformed copy of the Shelf Registration
Statement, as first filed with the Commission, and of each amendment
thereto (without any documents incorporated by reference therein
or
exhibits thereto (or exhibits incorporated in such exhibits by reference)
unless requested);
|
|
(j)
|
deliver
to each Holder and each of the underwriter(s), if any, without charge,
as
many copies of the Prospectus (including each preliminary prospectus)
and
any amendment or supplement thereto as such Persons may reasonably
request; subject to any notice by the Company in accordance with
this
Section of the existence of any fact or event of the kind described
in
clauses (ii) through (iv) of Section 4(d), the Company hereby consents
to
the use of the Prospectus and any amendment or supplement thereto
by each
of the selling Holders and each of the underwriter(s), if any, in
connection with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or supplement
thereto;
|
|
(k)
|
in
the case of an Underwritten Registration, enter into such customary
agreements (including underwriting agreements in customary form)
and take
all such other actions as are prudent and reasonable in order to
expedite
or facilitate the disposition of the Transfer Restricted Securities
and
cause to be delivered to the underwriters opinions of counsel to
the
Company in customary form, covering such matters as are customarily
covered by opinions for an underwritten public offering as the
underwriters may request, addressed to the underwriters and, if requested,
letters from the Company’s independent certified public accountants
addressed to the underwriter in customary form and covering such
financial
and accounting matters as are customarily covered by letters of
independent certified public accountants delivered in connection
with
primary or secondary underwritten public offerings as the case may
be;
|
B-10
|
(l)
|
prior
to any public offering of Transfer Restricted Securities, use commercially
reasonable efforts to cooperate with the Holders, the underwriter(s),
if
any, and their respective counsel in connection with the registration
or
qualification of the Transfer Restricted Securities under the securities
or Blue Sky laws of such jurisdiction in the United States as the
Holders
or underwriter(s), if any, may reasonably request and do any and
all other
acts or things necessary or customary to enable the disposition in
such
jurisdictions of the Transfer Restricted Securities covered by the
Shelf
Registration Statement; provided, however, that the Company shall
not be
required (i) to register or qualify as a foreign corporation or a
dealer
of securities where it is not now so qualified or to take any action
that
would subject it to the service of process in any jurisdiction where
it is
not now so subject or (ii) to subject themselves to taxation in any
such
jurisdiction if they are not now so
subject;
|
|
(m)
|
use
commercially reasonable efforts to cooperate with the selling Holders
and
the underwriter(s), if any, to facilitate the timely preparation
and
delivery of certificates representing Transfer Restricted Securities
to be
sold and not bearing any restrictive legends (unless required by
applicable securities laws) and enable such Transfer Restricted Securities
to be in such denominations and registered in such names as the Holders
or
the underwriter(s), if any, may request at least two Business Days
before
any sale of Transfer Restricted Securities made by such Holders or
underwriter(s);
|
|
(n)
|
at
all times after the Company has filed a registration statement with
the
Commission pursuant to the requirements of either the Securities
Act or
the Exchange Act, the Company shall file all reports required by
it to be
filed under the Securities Act and the Exchange Act and the rules
and
regulations adopted by the Commission thereunder, and take such further
action as the Holders may reasonably request, all to the extent required
to enable the Holders to be eligible to sell Transfer Restricted
Securities pursuant to Rule 144;
and
|
|
(o)
|
use
commercially reasonable efforts to cause all Transfer Restricted
Securities covered by the Shelf Registration Statement to be listed
or
quoted, as the case may be, on each securities exchange or automated
quotation system on which securities of the same class issued by
the
Company are then listed or, if no such similar securities are then
listed,
on the OTC Bulletin Board or on NASDAQ or such other national securities
exchange as may be selected by the
Company.
|
Each
Holder agrees by acquisition of the Transfer Restricted Securities that, upon
receipt of any notice from the Company of the existence of any fact of the
kind
described in clauses (ii) through (iv) of Section 4(d) hereof and during any
Suspension Period, such Holder will, and will use commercially reasonable
efforts to cause any underwriter(s) in an Underwritten Offering to, forthwith
discontinue disposition of Transfer Restricted Securities pursuant to the Shelf
Registration Statement until:
|
(a)
|
such
Holder has received copies of the supplemented or amended Prospectus
contemplated by Section 4(b) hereof;
or
|
|
(b)
|
such
Holder is advised in writing by the Company that the use of the Prospectus
may be resumed, and has received copies of any additional or supplemental
filings that are incorporated by reference in the
Prospectus.
|
B-11
If
so
directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice of suspension.
The Company may require each Holder to furnish and such Holder shall furnish
to
the Company any other information regarding the Holder and the distribution
of
the Transfer Restricted Securities as the Company may from time to time
reasonably require in writing.
| 5. |
Registration
Expenses.
|
All
expenses incidental to the Company's performance of and compliance with this
Agreement shall be borne by the Company regardless of whether a Registration
Statement becomes effective, including, without limitation:
|
(a)
|
all
registration and filing fees and expenses including but not limited
to the
preparation of all registration statements and all amendments or
supplements thereto;
|
|
(b)
|
all
fees and expenses of compliance with U.S. securities and Blue Sky
laws;
|
|
(c)
|
all
expenses of printing (including printing of Prospectuses and certificates
for the shares of Common Stock, messenger and delivery services and
telephone);
|
|
(d)
|
all
fees and disbursements of counsel to the
Company;
|
|
(e)
|
all
application and filing fees in connection with listing (or authorizing
for
quotation) the shares of Common Stock on any securities exchange
or
automated quotation system pursuant to the requirements hereof;
and
|
|
(f)
|
all
fees and disbursements of independent certified public accountants
of the
Company (including the expenses of any special audit and comfort
letters
required by or incident to such
performance).
|
The
Company shall bear its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal, accounting
or other duties), the expenses of any annual audit and the fees and expenses
of
any Person, including special experts, retained by the Company.
|
6.
|
Indemnification
and Contribution.
|
|
(a)
|
The
Company shall indemnify and hold harmless each Holder, such Holder's
officers, directors and employees and each person, if any, who controls
or
is controlled by such Holder within the meaning of Section 15 of
the
Securities Act (each Holder and each of its respective officers,
employees
and any such control person being an "Indemnified
Holder"),
from and against any loss, claim, damage or liability, joint or several,
or any action in respect thereof (including, but not limited to,
any loss,
claim, damage, liability or action relating to resales of the Transfer
Restricted Securities), to which such Indemnified Holder may become
subject, insofar as any such loss, claim, damage, liability or action
arises out of, or is based upon:
|
B-12
|
(i)
|
any
untrue statement or alleged untrue statement of a material fact contained
in (A) any Shelf Registration Statement or Prospectus or any amendment
thereof or supplement thereto (including in any periodic or current
report
filed by the Company pursuant to the Securities Exchange Act of 1934
which
is incorporated by reference therein) or (B) any blue sky application
or
other document or any amendment or supplement thereto prepared or
executed
by the Company (or based upon written information furnished by or
on
behalf of the Company expressly for use in such blue sky application
or
other document or amendment on supplement) filed in any jurisdiction
specifically for the purpose of qualifying any or all of the Transfer
Restricted Securities under the securities law of any state or other
jurisdiction (such application or document being hereinafter called
a
"Blue
Sky Application");
or
|
|
(ii)
|
the
omission or alleged omission to state therein any material fact required
to be stated therein or necessary to make the statements therein
(in the
case of the Prospectus, in the light of the circumstances under which
they
were made) not misleading,
|
and
shall
reimburse each Indemnified Holder promptly upon demand for any legal or other
expenses reasonably incurred by such Indemnified Holder in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of, or is based upon,
any untrue statement or alleged untrue statement or omission or alleged omission
made in any Shelf Registration Statement or Prospectus or amendment or
supplement thereto or Blue Sky Application in reliance upon and in conformity
with written information furnished to the Company by or on behalf of any Holder
(or its related Indemnified Holder) specifically for use therein or out of
the
failure by the Indemnified Holder to furnish to any purchaser of its Restricted
Transfer Securities, a copy of the Shelf Registration Statement, the Prospectus
or any supplement or amendment thereto in the form provided to such Indemnified
Holder by the Company. The foregoing indemnity agreement is in addition to
any
liability that the Company may otherwise have to any Indemnified
Holder.
|
(b)
|
Each
Holder, severally and not jointly, shall indemnify and hold harmless
the
Company, its officers, directors and employees and each person, if
any,
who controls the Company within the meaning of Section 15 of the
Securities Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof arising out of,
or
based upon:
|
|
(i)
|
any
untrue statement or alleged untrue statement of any material fact
contained in the Shelf Registration Statement or Prospectus or any
amendment or supplement thereto or any Blue Sky Application;
or
|
|
(ii)
|
the
omission or the alleged omission to state therein any material fact
required to be stated therein or necessary to make the statements
therein
(in the case of the prospectus, in light of the circumstances under
which
they were made), not misleading,
|
B-13
but
in
each case (i) only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by or on behalf
of
such Holder (or its related Indemnified Holder) specifically for use therein
or
caused by such Holder’s failure to deliver to such Holder’s immediate purchaser
a copy of the Shelf Registration Statement or Prospectus or any amendments
thereof or supplements thereto (if the same was required by applicable law
to be
so delivered) and (ii) such Holder shall be liable under this Agreement for
only
that amount as does not exceed the proceeds actually received by such Holder
as
a result of the sale of Transfer Restricted Securities pursuant to such Shelf
Registration Statement, and shall reimburse the Company, and any such director,
officer, employee or controlling person promptly upon demand for any legal
or
other expenses reasonably incurred by the Company, or any such director,
officer, employee or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement
is in
addition to any liability that any Holder may otherwise have to the Company,
or
any of their respective directors, officers, employees or controlling persons
and any such director, officer, employee or controlling person.
|
(c)
|
Promptly
after receipt by an indemnified party under subsection (a) or
(b) above of notice of any claims or the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to
be made
against the indemnifying party under such subsection, notify each
party
against whom indemnification is to be sought in writing of the claim
or
the commencement thereof (but the failure to notify an indemnifying
party
shall not relieve it from any liability which it may have under this
Section 6). In case any such claim or action is brought against any
indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein, and to the extent it may elect by written notice
delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof
with
counsel reasonably satisfactory to such indemnified party. Notwithstanding
the foregoing, the indemnified party or parties shall have the right
to
employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such indemnified
party
or parties, other than reasonable costs of investigation, unless:
(i) the employment of such counsel shall have been authorized in
writing by one of the indemnifying parties in connection with the
defense
of such action; (ii) the indemnifying parties shall not have employed
counsel to have charge of the defense of such action within a reasonable
time after notice of commencement of the action; or (iii) the named
parties to any such action include both the indemnifying party and
the
indemnified party and such parties have been advised by counsel to
the
indemnifying party that either (x) representation of such indemnified
party and the indemnifying party by the same counsel would be
inappropriate under applicable standards of professional conduct
or (y)
there may be one or more legal equitable defenses available to the
indemnified party which are different from, in conflict with, or
additional to, those available to the indemnifying party (in which
case
the indemnifying parties shall not have the right to direct the defense
of
such action on behalf of the indemnified party or parties), in any
of
which events the fees and expenses of one counsel selected by all
the
indemnified parties to represent them all shall be borne by the
indemnifying parties. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement or
compromise of, or consent to the entry of judgment with respect to,
any
pending or threatened action in respect of which the indemnified
party is
or reasonably could have been a party and indemnity or contribution
may be
or could have been sought hereunder by the indemnified party (an
"Action"),
unless such settlement, compromise or judgment (x) includes an
unconditional release of the indemnified party from all liability
on
claims that are the subject matter of such action and (y) does not
include a statement as to or an admission of fault, culpability or
a
failure to act, by or on behalf of the indemnified party. No indemnified
party shall, without the prior written consent of the indemnifying
party,
effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any Action, unless such settlement, compromise
or consent includes an unconditional release of such indemnified
party
from all liability on claims that are the subject matter of such
Action.
|
B-14
|
(d)
|
If
the indemnification provided for in this Section 6 is held by a court
of competent jurisdiction to be unavailable to an indemnified party
with
respect to any loss, liability, claim, damage or expense referred
to
herein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid
or
payable by such indemnified party as a result of such loss, liability,
claim, damage or expense in such proportion as is appropriate to
reflect
the relative fault of the indemnifying party on the one hand and
of the
indemnified party on the other in connection with the statements
or
omissions that resulted in such loss, liability, claim, damage or
expense,
as well as any other relevant equitable considerations; provided,
however,
that a Holder will not be obligated to contribute more than the net
proceeds received by such Holder from such offering. The relative
fault of
the indemnifying party and of the indemnified party shall be determined
by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material
fact
relates to information supplied by the indemnifying party or by the
indemnified party and the parties' relative intent, knowledge, access
to
information, and opportunity to correct or prevent such statement
or
omission. No person guilty of fraudulent misrepresentation (within
the
meaning of Section 11(f) of the Securities Act) shall be entitled
to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Holders' obligations to contribute as provided
in
this Section 6(d) are several and not
joint.
|
| 7. |
Rule
144
|
The
Company shall use commercially reasonable efforts to file the reports required
to be filed by it under the Securities Act and the Exchange Act in a timely
manner and, if at any time the Company is not required to file such reports,
it
will, upon the request of any Holder, make publicly available other information
so long as necessary to permit sales of their securities pursuant to
Rule 144. The Company covenants that it will take such further action as
any Holder may reasonably request, all to the extent required from time to
time
to enable such Holder to sell Transfer Restricted Securities without
registration under the Securities Act within the limitation of the exemptions
provided by Rule 144. Upon the written request of any Holder, the Company
shall deliver to such Holder a written statement as to whether it has complied
with such requirements.
|
8.
|
Participation
in Underwritten Registrations.
|
The
Holders may not participate in any Underwritten Registration hereunder unless
such Holder:
|
(a)
|
agrees
to sell such Holder's Transfer Restricted Securities on the basis
provided
in any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements;
and
|
|
(b)
|
completes
and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents
required under the terms of such underwriting
arrangements.
|
B-15
|
9.
|
Selection
of Underwriters.
|
The
Holders may sell such Transfer Restricted Securities covered by the Shelf
Registration Statements in an Underwritten Offering. In any such Underwritten
Offering, the investment banker or investment bankers and manager or managers
that will administer the offering will be selected by Holders holding a majority
of the Transfer Restricted Securities whose Transfer Restricted Securities
are
included in such offering; provided, however, that such investment bankers
and
managers must be reasonably satisfactory to the Company.
|
10.
|
Miscellaneous.
|
|
(a)
|
Remedies.
The Company acknowledges and agrees that any failure by the Company
to
comply with its obligations under Section 2 hereof may result in
material
irreparable injury to the Holders for which there is no adequate
remedy at
law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of any such failure, the Holder
may
obtain such relief as may be required to specifically enforce the
Company's obligations under Section 2 hereof, in addition to the
Default
Damages provided for in Section 2(a) hereof. The Company further
agrees to waive the defense in any action for specific performance
that a
remedy at law would be adequate.
|
|
(b)
|
No
Inconsistent Agreements.
The Company shall not, on or after the date of this Agreement, enter
into
any agreement with respect to its securities that interferes with
the
rights granted to the Holders in this Agreement or otherwise conflicts
with the provisions hereof.
|
|
(c)
|
Amendments
and Waivers.
This Agreement may not be amended, modified or supplemented except
by an
instrument in writing signed by the Company and the Holder, and waivers
or
consents to or departures from the provisions hereof may not be given,
unless the Company has obtained the written consent of the Holders
holding
a majority of the Transfer Restricted
Securities.
|
|
(d)
|
Notices.
All notices and other communications provided for or permitted hereunder
shall be made in writing (except if the context expressly permits
otherwise) by hand-delivery, first-class mail (registered or certified,
return receipt requested), telecopier, or air courier guaranteeing
overnight delivery:
|
|
(i)
|
if
to a Holder, at the address set forth on the records of the transfer
agent
of shares of Common Stock, as the case may
be
|
with
a
copy to:
Fortress
Paper Ltd.
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇
▇▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
Tel:
(▇▇▇)
▇▇▇-▇▇▇▇
Fax:
(▇▇▇)-▇▇▇-▇▇▇▇
B-16
With
a
copy to:
Sangra
Moller LLP
Barristers
& Solicitors
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Attention:
▇▇▇▇▇▇▇ ▇▇▇
Telephone:
(▇▇▇)-▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇)-▇▇▇-▇▇▇▇
and
|
(ii)
|
if
to the Company:
|
c/o
iDcentrix, Inc.
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇
▇▇▇▇
▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Chief Executive Officer
Telephone:
(▇▇▇)-▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇)-▇▇▇-▇▇▇▇
With
a
copy to:
▇▇▇▇▇▇
▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone:
(▇▇▇)-▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇)-▇▇▇-▇▇▇▇
and
|
(ii)
|
if
to iDcentrix:
|
iDcentrix
Inc.
▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇
▇▇▇▇
▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Attention:
Chief Executive Officer
Telephone:
(▇▇▇)-▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇)-▇▇▇-▇▇▇▇
B-17
With
a
copy to:
▇▇▇▇▇▇
▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention:
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone:
(▇▇▇)-▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇)-▇▇▇-▇▇▇▇
All
such
notices and communications shall be deemed to have been duly given at: the
time
delivered by hand, if personally delivered; five Business Days after being
deposited in the mail, postage prepaid, if mailed; when receipt acknowledged,
if
telecopied; and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.
|
(e)
|
Successors
and Assigns.
This Agreement shall not be assigned without the prior written consent
of
the Company in its sole discretion such consent not to be unreasonably
withheld; provided, however, that (i) this Agreement shall not inure
to
the benefit of or be binding upon a permitted successor or assign
of a
Holder as provided herein unless and to the extent such successor
or
assign acquired Transfer Restricted Securities from such Holder;
and (ii)
upon the occurrence of a Registration Default that continues for
30 days
or more or Registration Defaults that continue for more than 45 days
in
any 365-day period, the Agreement may be assigned by the Holder with
the
written consent of the Company not to be unreasonably
withheld.
|
|
(f)
|
Counterparts.
This Agreement may be executed in any number of counterparts, each
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.
|
|
(g)
|
Securities
Held by the Company or its Affiliates.
Whenever the consent or approval of Holders of a specified percentage
of
Transfer Restricted Securities is required hereunder, Transfer Restricted
Securities held by the Company or its Affiliates shall not be counted
in
determining whether such consent or approval was given by the Holders
of
such required percentage.
|
|
(h)
|
Headings.
The headings in this Agreement are for convenience of reference only
and
are not to be considered a part of this Agreement and shall in no
way
modify or restrict any of the terms or provisions
hereof.
|
|
(i)
|
Governing
Law.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE
LAW OF THE STATE OF NEVADA, BUT WITHOUT REGARD TO ANY APPLICABILITY
PRINCIPLES OF CONFLICTS OF LAW.
|
|
(j)
|
Severability.
If any one or more of the provisions contained herein, or the application
thereof in any circumstance, is held invalid, illegal or unenforceable,
the validity, legality and enforceability of any such provision in
every
other respect and of the remaining provisions contained herein shall
not
be affected or impaired thereby.
|
B-18
|
(k)
|
Entire
Agreement.
This Agreement is intended by the parties as a final expression of
their
agreement and intended to be a complete and exclusive statement of
the
agreement and understanding of the parties hereto in respect of the
subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred
to
herein with respect to the registration rights granted by the Company
with
respect to the Transfer Restricted Securities. This Agreement supersedes
all prior agreements and understandings between the parties with
respect
to such subject matter.
|
IN
WITNESS WHEREOF,
the
parties have executed this Agreement as of the date first written
above.
|
IDCENTRIX
INC.
|
||||
|
By:
|
By:
|
|||
|
Name:
|
Name:
|
|||
|
Title
|
Title
|
|||
|
FORTRESS
PAPER LTD.
|
||||
|
By:
|
||||
|
Name:
|
||||
|
Title:
|
||||
B-19
FORM
OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE
The
undersigned beneficial holder of common shares (the "Registrable Securities")
of
Sterling Gold Corp. (the "Company") understands that the Company has filed
or
intends to file with the Securities and Exchange Commission (the "SEC") a
registration statement (the "Shelf 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 Agreement (the "Registration Rights Agreement") dated
December l, 2007 between the Company, iDcentrix and
the Holders named therein. The information in this notice includes a summary
of
certain of the provisions of the Registration Rights Agreement, which you should
review. A copy of the Registration Rights Agreement is available from the
Company upon request at the address set forth below. All capitalized terms
used
but not otherwise defined herein shall have the meanings ascribed thereto in
the
Registration Rights Agreement.
Each
beneficial owner of Registrable Securities is entitled to the benefits of the
Registration Rights Agreement. In order to sell or otherwise dispose of any
Registrable Securities pursuant to the Shelf Registration Statement, a
beneficial owner of Registrable Securities generally will be required to be
named as a selling securityholder in the related prospectus, deliver a
prospectus to purchasers of Registrable Securities and be bound by those
provisions of the Registration Rights Agreement applicable to such beneficial
owner (including certain indemnification provisions as described below).
Beneficial owners that do not complete this Notice and Questionnaire and deliver
it to the Company as provided below will not be named as selling securityholders
in the prospectus and therefore will not be permitted to sell any Registrable
Securities pursuant to the Shelf Registration Statement. Beneficial owners
are
encouraged to complete and deliver this Notice and Questionnaire at least five
business days prior to the effectiveness of the Shelf Registration Statement
so
that such beneficial owners may be named as selling securityholders in the
related prospectus at the time of its effectiveness.
Certain
legal consequences arise from being named as a selling securityholder in the
Shelf Registration Statement and the related prospectus. Accordingly, the
Holders 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 Shelf Registration Statement and the related prospectus.
Notice
The
undersigned beneficial owner (the "Selling Securityholder") of Registrable
Securities hereby gives notice to the Company of its intention to sell or
otherwise dispose of Registrable Securities beneficially owned by it and listed
below in Item 3 (unless otherwise specified under Item 3) pursuant to the Shelf
Registration Statement. The undersigned, by signing and returning this Notice
and Questionnaire, understands that it will be bound by the terms and conditions
of this Notice and Questionnaire and the Registration Rights Agreement.
Pursuant
to the Registration Rights Agreement, the undersigned has agreed to indemnify
and hold harmless the Company, and each person, if any, who controls the Company
within the meaning of either Section 15 of the Securities Act or Section 20
of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), against
any and all loss, liability, claim, damage and expense arising in connection
with statements concerning the undersigned made in the Shelf Registration
Statement or the related prospectus in reliance upon the information provided
in
this Notice and Questionnaire.
The
undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate and complete:
B-20
QUESTIONNAIRE
| 1. | (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 listed in (3) below are
held:
|
|
|
(c)
|
Full
Legal Name of Depository Trust Company Participant (if applicable
and if
not the same as (b) above) through which Registrable Securities listed
in
(3) below are held:
|
|
| 2. | Address for Notices to Selling Securityholder: |
|
Fax:
|
|
Contact Person:
|
| 3. | Beneficial Ownership of Registrable Securities: |
|
(a)
|
Type
and Principal amount of Registrable Securities Beneficially
Owned:
|
|
|
(b)
|
CUSIP
No(s). of such Registrable Securities Beneficially
Owned:
|
|
| 4. | Beneficial Ownership of the Company's Securities 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 Registrable
Securities listed in Item (3).
|
(a)
|
Type
and Amount of Other Securities Beneficially Owned by the Selling
Securityholder:
|
|
|
(b)
|
CUSIP
No(s). of such other Securities Beneficially Owned:
|
|
| 5. | Relationship with the Company: |
Except
as
set forth below, neither the undersigned nor any of its affiliates, directors
or
principal equity holders (5% or more) 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.
B-21
State
any
exceptions here:
| 6. | Plan of Distribution: |
Except
as
set forth below, the undersigned intends to distribute the Registrable
Securities listed above in Item (3) pursuant to the Shelf Registration Statement
only as follows (if at all): Such Registrable Securities may be sold from time
to time directly by the undersigned or alternatively through underwriters or
broker dealers or agents. If the Registrable Securities are sold through
underwriters or broker dealers, the Selling Securityholder will be responsible
for underwriting discounts or commissions or agent's commissions. Such
Registrable Securities may be sold in one or more transactions at fixed prices,
at prevailing market prices at the time of sale, at varying prices determined
at
the time of sale, or at negotiated prices. Such sales may be effected in
transactions (which may involve block transactions) (i) on any national
securities exchange or quotation service on which the Registrable Securities
may
be listed or quoted at the time of sale, (ii) in the over-the-counter market,
(iii) in transactions otherwise than on such exchanges or services or in the
over-the-counter market, or (iv) through the writing of options, swaps or other
derivatives (whether exchange-listed or otherwise); or (vi) through any
combination of the foregoing, or by any other legally available means. In
connection with sales of the Registrable Securities or otherwise, the
undersigned may enter into hedging transactions with broker dealers, which
may
in turn engage in short sales of the Registrable Securities, short and deliver
Registrable Securities to close out such short positions, or loan or pledge
Registrable Securities to broker dealers that in turn may sell such securities.
The shares may be sold or distributed from time to time by pledgees, donees
or
transferees of, or other successors in interest to, the
undersigned.
State
any
exceptions here:
|
Note:
|
In
no event may such method(s) of distribution take the form of an
underwritten offering of the Registrable Securities without the prior
agreement of the Company and an undertaking by the Selling Securityholder
to pay certain expenses related to such offering.
|
The
undersigned acknowledges that it understands its obligation to comply with
the
provisions of the Exchange Act and the rules thereunder relating to stock
manipulation, particularly Regulation M thereunder (or any successor rules
or
regulations), in connection with any offering of Registrable Securities pursuant
to the Shelf Registration Statement. The undersigned agrees that neither it
nor
any person acting on its behalf will engage in any transaction in violation
of
such provision.
B-22
The
Selling Securityholder hereby acknowledges that there may be "black out" periods
during which Registrable Securities may not be sold pursuant to the Shelf
Registration Statement, as set forth in the Registration Rights Agreement.
The
Selling Securityholder hereby acknowledges its obligations under the
Registration Rights Agreement to indemnify and hold harmless certain persons
set
forth therein.
Pursuant
to the Registration Rights Agreement, the Company has agreed under certain
circumstances to indemnify the Selling Securityholders against certain
liabilities.
In
accordance with the undersigned's obligations under the Registration Rights
Agreement to provide such information as may be required by law for inclusion
in
the Shelf Registration Statement, 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 Shelf Registration
Statement remains effective. All notices to the Company hereunder and pursuant
to the Registration Rights Agreement shall be made in writing at the address
set
forth below. All notices to the undersigned pursuant to the Registration Rights
Agreement shall be made in writing at the address set forth in paragraph 2,
or
any other address given to the Company by notice from the undersigned.
By
signing below, the undersigned consents to the disclosure of the information
contained herein in its answers to Items (1) through (6) above or provided
by
the undersigned as contemplated by the immediately preceding paragraph and
the
inclusion of such information in the Shelf Registration Statement and the
related prospectus. The undersigned understands that such information will
be
relied upon by the Company in connection with the preparation or amendment
of
the Shelf 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.
|
Beneficial
Owner
|
||||
|
By:
|
||||
|
Name:
|
||||
|
Title:
|
||||
|
Dated:
|
||||
PLEASE
RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO STERLING GOLD
CORP., AT:
c/o.
iDcentrix, Inc.
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Attention:
Chief Executive Officer
with
a
copy to:
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▇▇▇▇ & ▇▇▇▇▇▇ LLP
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Attention:
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B-23