PARTNERSHIP AGREEMENT

Between [ ] and [ ]

!!ective as o! [ ]" 20[ ]

/var/www/apps/conversion/tmp/scratch_5/218535467.doc 2012-07-31 15:55

PARTNERSHIP AGREEMENT THIS PARTNERSHIP AGREEMENT e!!ective as o! the 1st da# o! $cto%er" 2003. BETWEEN: [ ]" incorporated &nder the 'aws o! [ ]. (hereina!ter )X*+ $, -. ,/01- 230-" - and [ ]" incorporated &nder the 'aws [ ]. (hereina!ter )Y*+ $, -. 1 4$56 230-. WHEREAS 7 and 8 entered into the 2artnership (as de!ined herein+ e!!ective as o! $cto%er 1" 2003 on the terms and conditions hereina!ter set !orth9 AND WHEREAS !rom and !o''owin: [ ]" the 2artnership ac;&ired certain assets re;&ired %# it to carr# on its %&siness9 NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration o! the premises and the m&t&a' covenants" a:reements and conditions herein contained" it is here%# covenanted" a:reed and dec'ared %# and amon: the 2artners (as de!ined herein+ as !o''ows: ARTICLE 1 INTRODUCTION 1.1 Defi i!i" #.

/n this 3:reement (as de!ined herein+" &n'ess there is somethin: in the s&%<ect matter or conte=t inconsistent therewith" the !o''owin: terms sha'' have the respective meanin:s ascri%ed %e'ow: (a+ (%+ )A$$"% !& !#* means s&ch !irm o! acco&ntants as the 2artners ma# !rom time to time determine to %e the acco&ntants o! the 2artnership (as de!ined herein+9 )A'(ee)e !*" )!*i# A'(ee)e !*" )*e(e!"*" )*e(ei *" )*e(e+,*" )*e(e% -e(* and simi'ar e=pressions re!er to this 3:reement and not to an# partic&'ar 3rtic'e"

-21ection or other portion hereo!" and inc'&de an# and ever# instr&ment s&pp'ementa' or anci''ar# to or in imp'ement hereo!9 (c+ )B%#i e##* means an# %&siness or %&sinesses carried on %# the 2artnership as ma# %e deemed %# the 2artners to %e in the %est interest o! the 2artnership and an# other :enera' %&siness activities re'ated or incidenta' thereto9 )Effe$!i.e D&!e* means $cto%er 1" 20039 )Fi#$&/ Ye&(* means >&ne 1 to ?a# 319 )P&(! e(* means an# one o! 7 or 8 or an# other partner admitted p&rs&ant to the provisions o! this 3:reement" )P&(! e(#* means a'' o! them" and the )P&(! e(#*i0* means the partnership esta%'ished %# this 3:reement9 and )Pe(#" * means an# individ&a'" !irm" corporation" partnership" <oint vent&re" tr&stee or tr&st" :overnment or a:enc# thereo!" &nincorporated association" or other entit# and prono&ns have a simi'ar'# e=tended meanin:.

(d+ (e+ (!+

(:+

1.1

N%)+e( & - Ge -e(.

@ords importin: the sin:&'ar inc'&de the p'&ra' and vice versa and words importin: :ender inc'&de a'' :enders. 1.2 G".e( i ' Le'i#/&!i" .

=cept as e=press'# stip&'ated in this 3:reement to the contrar#" the ri:hts and o%'i:ations o! the 2artners and the administration and termination o! the 2artnership sha'' %e :overned %# the Partnership Act ($ntario+ (the )A$!*+ or an# s&ccessor 'e:is'ation or other stat&te which ma# %e passed to taAe the p'ace o! the 3ct or to amend same. ARTICLE 1 FORMATION OF PARTNERSHIP 1.1 E#!&+/i#*)e !.

1&%<ect to the terms and conditions hereo!" the parties hereto a:ree to carr# on the B&siness in partnership. 1.1 Te().

1&%<ect to the provisions o! this 3:reement" the 2artnership sha'' commence as o! the !!ective 6ate and sha'' contin&e !or a term endin: on the ear'ier o!: (a+ (%+ the date on which the 2artnership is vo'&ntari'# disso'ved %# &nanimo&s a:reement o! the 2artners9 or the date on which the 2artnership is disso'ved %# operation o! 'aw.

-31.2 N&)e.

-he name o! the 2artnership sha'' %e ) [ ]* and/or s&ch other name or names as the 2artners ma# !rom time to time a:ree &pon in writin: and no part# sha'' carr# on %&siness &nder s&ch name e=cept as a 2artner o! the 2artnership. 1.3 P/&$e "f B%#i e##.

-he p'ace o! %&siness o! the 2artnership sha'' %e at s&ch p'ace or p'aces as the 2artners sha'' !rom time to time herea!ter determine. 1.4 Ne5 P&(! e(#.

5o person sha'' %e admitted as a 2artner e=cept with the &nanimo&s consent in writin: o! the 2artners. ARTICLE 2 FINANCIAL MATTERS 2.1 C&0i!&/ C" !(i+%!i" # & - Fi & $i ' Re6%i(e)e !#. -he initia' capita' o! the 2artnership sha'' %e: (a+ (%+ ,or 7 the amo&nt o! B[ ]" %ein: the capita' contri%&tion made %# 7 to the 2artnership on [ ]9 and ,or 8 the amo&nt o! B[ ]" %ein: the capita' contri%&tion made %# 8 to the 2artnership on [ ]

-he initia' capita' so contri%&ted %# each o! the 2artners is credited to the capita' acco&nt ()C&0i!&/ A$$"% !*+ o! each 2artner. -he !o''owin: provisions o! this 1ection 3.1 sha'' app'# in respect o! the capita' contri%&tions o! the 2artners: (c+ (d+ the capita' !&nds o! the 2artnership sha'' %e'on: to the 2artners in the proportion contri%&ted %# each 2artner9 an# !&rther contri%&tion o! capita' re;&ired %# the 2artnership ma# %e contri%&ted to the 2artnership %# an# one or %oth o! the 2artners witho&t 'imitation as to the amo&nt o! s&ch !&rther capita' contri%&tion and an# s&ch additiona' capita' contri%&tion sha'' %e treated in the same manner as the initia' capita' contri%&tions a%ove set o&t9 and no 2artner sha'' %e entit'ed to interest on the amo&nt o! its capita' contri%&tion to the 2artnership.

(e+ 2.1

P("fi!# & - L"##e#.

/n each ,isca' 8ear a'' items o! income and :ain" and e=pense and 'oss o! the 2artnership sha'' %e determined %# the 3cco&ntants o! the 2artnership at the end o! each ,isca' 8ear.

-42.2 Ne! P("fi!# & - L"##e#.

Cnti' otherwise &nanimo&s'# a:reed %# the 2artners" and s&%<ect to the provisions o! this 3:reement" the net pro!its" i! an#" o! the 2artnership as determined at the end o! each s&ch ,isca' 8ear sha'' %e a''ocated amon: the 2artners in proportion to the respective 4apita' 3cco&nt o! each o! the 2artners as ca'c&'ated at the end o! each s&ch ,isca' 8ear. 3'' e=penses inc&rred in the co&rse o! the B&siness and a'' 'osses" i! an#" arisin: there!rom sha'' %e %orne o&t o! the earnin:s o! the B&siness" or in the case o! a de!icienc#" the 'osses sha'' %e a''ocated amon:st the 2artners pro rata to their respective individ&a' 4apita' 3cco&nts at the end o! each s&ch ,isca' 8ear. 2.3 D(&5i '#.

ach o! the 2artners ma# draw o&t o! the 2artnership" !rom time to time" on acco&nt o! its share o! the net pro!its !or the c&rrent #ear" a s&m not e=ceedin: their respective 4apita' 3cco&nts. 3n# s&ms drawn o&t %# an# 2artner in e=cess o! its share o! the net pro!its !or an# s&ch #ear sha'' %e repaid in !&'' to the 2artnership &n'ess otherwise &nanimo&s'# a:reed %# the 2artners. 2.4 Fi & $i&/ S!&!e)e !#.

2roper acco&nts sha'' %e Aept o! a'' transactions o! the B&siness and at the end o! each ,isca' 8ear or as soon therea!ter as possi%'e" a statement sha'' %e prepared showin: the income and e=penses o! the B&siness !or the past #ear and what %e'on:s and is d&e to each o! the 2artners as its share o! the pro!its. 2.7 B"(("5i ' "( E $%)+(& $e "f P&(! e(#*i0 I !e(e#!.

5either 2artner sha''" witho&t the previo&s consent in writin: o! the other" si:n or enc&m%er its share or interest in the 2artnership" %orrow mone# on %eha'! o! the B&siness or" hire an# emp'o#ee or s&%contractor. 2.8 P&,)e ! "f O+/i'&!i" #.

ach o! the 2artners sha'' p&nct&a''# pa# and dischar:e its separate de%ts" 'ia%i'ities" o%'i:ations" d&ties and a:reements whether at present or !&t&re and Aeep indemni!ied the 2artnership propert# and the other 2artner !rom a'' actions" proceedin:s" costs" c'aims and demands o! ever# nat&re. 2.9 I -e) ifi$&!i" .

/! at an# time either o! the 2artners is re;&ired to pa# or %ecome 'ia%'e !or more than its proportion o! the 2artnership de%ts as provided !or in this 3:reement" that 2artner sha'' have as a:ainst the other 2artner a ri:ht o! recover# o! the appropriate proportion o! the pa#ment or indemni!ication a:ainst s&ch 'ia%i'it#" and the 2artner sha'' have" on %ecomin: 'ia%'e !or s&ch de%t" the !irst 'ien or char:e on the capita' and a'' other interest or interests o! the o!!endin: 2artner in the 2artnership %&siness.

-5ARTICLE 3 MANAGEMENT 3.1 M& &'e)e !.

,ina' a&thorit#" mana:ement and contro' o! the %&siness and a!!airs o! the 2artnership sha'' %e vested in the 2artners. 3.1 A$!i" "f !*e P&(! e(#.

-he powers o! the 2artners ma# %e e=ercised %# reso'&tion passed at a meetin: o! the 2artners or %# reso'&tion consented to %# the si:nat&res o! the 2artners. 3.2 De/e'&!i" "f A%!*"(i!,.

-he 2artners ma# at an# time and !rom time to time %# reso'&tion passed at a meetin: o! the 2artners de'e:ate an# power or a&thorit# re'atin: to the mana:ement o! the %&siness and a!!airs o! the 2artnership to an# 2artner and the e=ercise o! an# s&ch a&thorit# or a&thorit# %# s&ch 2artner sha'' %e va'id and %indin: &pon a'' 2artners &nti' s&ch power or a&thorit# has %een rescinded %# reso'&tion. 3.3 P/&$e "f Mee!i '.

?eetin:s o! the 2artners sha'' %e he'd at the principa' o!!ice o! the 2artnership" or" at s&ch other p'ace as the 2artners ma#" %# &nanimo&s a:reement" determine. 3.4 C&//i ' "f Mee!i '#.

?eetin:s o! the 2artners sha'' %e he'd !rom time to time at s&ch time and on s&ch da# witho&t notice as an# 2artner ma# determine. 3.7 P"5e( "f A!!"( e,.

ach 2artner :rants to the other 2artner !or s&ch time as he remains a 2artner to this 3:reement" an irrevoca%'e power o! attorne# !or the p&rposes o! !i'in: an# notices or re:istrations as ma# %e re;&ired %# 'aw in connection with the e=istence or carr#in: on o! the %&siness o! the 2artnership. 3.8 Fi#$&/ Ye&(.

Cnti' chan:ed with the &nanimo&s approva' o! the 2artners" the ,isca' 8ear sha'' %e the !isca' #ear o! the 2artnership. 3.9 B& :i ' A((& 'e)e !#.

-he 2artners a:ree that the 2artnership sha'' enter into %anAin: arran:ements with an# %anA or %anAs or other !inancia' instit&tions as the 2artners sha'' a:ree on. 3'' che;&es" dra!ts and other instr&ments and doc&ments on %eha'! o! the 2artnership ma# %e si:ned %# an# one o! the 2artners a'one" &n'ess otherwise a:reed %etween the parties. 3'' 2artnership mone# sha''" when received !rom time to time" %e paid and deposited with the %anAers o! the 2artnership to the credit o! the 2artnership acco&nt.

-63.; B"":# & - Re$"(-#.

4omp'ete and acc&rate %ooAs o! acco&nt sha'' %e Aept at the principa' p'ace o! %&siness o! the 2artnership and sha'' show the condition o! the %&siness and !inances o! the 2artnership" and each 2artner sha'' have access to" and ma# inspect and cop#" an# part thereo!. 3.1< P&(! e(#*i0 P("0e(!,.

Cn'ess otherwise &nanimo&s'# a:reed %# the 2artners or &n'ess re:istered in the name o! a tr&stee" a'' 2artnership propert# sha'' %e re:istered in the name o! the 2artnership in proportion to the 4apita' 3cco&nt o! each 2artner. ARTICLE 4 DETERMINATION OF PARTNERSHIP 4.1 Ge e(&/.

=cept as e=press'# permitted in this 3rtic'e 5" or as otherwise &nanimo&s'# a:reed to in writin: %# the 2artners" no 2artner ma# se''" assi:n" conve#" trans!er" mort:a:e" char:e or otherwise enc&m%er a'' or an# part o! its share or interest in the 2artnership. 4.1 Di##"/%!i" .

-he 2artnership sha'' %e disso'ved at an# time %# &nanimo&s reso'&tion o! the 2artners passed at a meetin: o! the 2artners ca''ed !or that p&rpose. -he 2artnership ma# a'so %e terminated %# &nanimo&s a:reement in writin: si:ned %# a'' o! the 2artners. 4.2 De!e()i &!i" .

/n the event o! the disso'&tion o! the 2artnership" the 2artnership sha'' terminate and a proper acco&ntin: sha'' %e made o! the capita' and income acco&nts o! each 2artner and the pro!it or 'osses o! the 2artnership to the date o! disso'&tion %# the 3cco&ntants. -he assets o! the 2artnership sha'' %e 'i;&idated and the proceeds o! s&ch 'i;&idation sha'' then %e distri%&ted as !o''ows" &n'ess the 2artners otherwise &nanimo&s'# a:ree: (a+ (%+ (c+ !irst'#" to repa# a'' costs" de%ts" e=penses" 'ia%i'ities and o%'i:ations o! the 2artnership9 second'#" to pa# to each 2artner its share o! the capita'9 and third'#" to divide the s&rp'&s" i! an#" %etween the 2artners in the proportions in which the# are entit'ed to share in pro!its.

/n the event that s&ch 'i;&idation proceeds sha'' not %e s&!!icient to satis!# the 'ia%i'ities o! the 2artnership" each o! the 2artners sha'' contri%&te its pro rata share" as determined in accordance with their individ&a' 4apita' 3cco&nts o! the 2artnership" o! s&ch !&rther !&nds as sha'' %e necessar# to satis!# in !&''" the 'ia%i'ities o! the 2artnership.

-74.3 A'(ee)e !# 5i!* T(& #fe(ee#.

/n the event that an# 2artner (in this 1ection 5.4 ca''ed the )T(& #fe("(*+" p&rs&ant to the terms and conditions hereo!" p&rports to trans!er a''" %&t not 'ess than a''" o! its interest or share in the 2artnership to an# 2erson (s&ch 2erson in this 1ection 5.4 ca''ed the ) T(& #fe(ee*+" then no s&ch trans!er sha'' %e made or sha'' %e e!!ective &nti' the -rans!eree enters into an a:reement with the other 2artner hereto where%# the -rans!eree a:rees to ass&me and %e %o&nd %# a'' o! the o%'i:ations o! the -rans!eror and to %e s&%<ect to a'' o! the terms and conditions o! this 3:reement. 4.4 Re#!(&i i ' O(-e(.

/n the event that an# 2artner sha'' at an# time p&rport to trans!er" char:e or mort:a:e its interest or share or an# part thereo! in the 2artnership in vio'ation o! the provisions o! this 3:reement" then the other 2artner sha''" in addition to an# ri:hts and remedies which ma# %e avai'a%'e to s&ch 2artner" at 'aw or in e;&it#" %e entit'ed to a decree or order restrainin: or en<oinin: s&ch trans!er" char:e or mort:a:e. ARTICLE 7 GENERAL 7.1 He&-i '#.

-he headin:s o! an# 3rtic'e" 1ection or part thereo! are inserted !or p&rposes o! convenience on'# and sha'' not !orm part hereo! and sha'' not %e considered in the interpretation hereo!. 7.1 N"!i$e#.

3n# notice" demand" re;&est" consent" a:reement or approva' which ma# or is re;&ired to %e :iven p&rs&ant to this 3:reement sha'' %e in writin: and sha'' %e s&!!icient'# :iven or made i! served persona''# &pon the part# or a representative or o!!icer o! the part# !or whom it is intended" or mai'ed %# certi!ied or re:istered mai'" posta:e prepaid" or te'e=ed" te'e:raphed" or te'ecopied" addressed at s&ch address to s&ch o!!icers as a part# ma# !rom time to time advise to the other parties %# notice in writin:. -he date o! receipt o! an# s&ch notice" demand" re;&est" consent" a:reement or approva' i! served persona''# sha'' %e deemed to %e the date o! de'iver# thereo!" or i! mai'ed as a!oresaid" the second %&siness da# !o''owin: the date o! mai'in:" or i! de'ivered via te'e=" te'e:raph" or te'ecopier" the %&siness da# !o''owin: transmission. 7.2 G".e( i ' L&5.

-he va'idit# and interpretation o! this 3:reement sha'' %e :overned e=c'&sive'# %# the 'aws o! the 2rovince o! $ntario and the !edera' 'aws o! 4anada app'ica%'e therein. 7.3 Se.e(&+i/i!,.

-he inva'idit# or &nen!orcea%i'it# o! an# partic&'ar provision o! this 3:reement sha'' not a!!ect an# other provision hereo!" %&t this 3:reement sha'' %e constr&ed and en!orced as i! s&ch inva'id or &nen!orcea%'e provision was omitted.

-87.4 Effe$!i.e D&!e.

5otwithstandin: the act&a' date o! e=ec&tion hereo!" this 3:reement sha'' %e e!!ective as o! and !rom the !!ective 6ate. 7.7 E !i(e A'(ee)e !.

-his 3:reement em%odies the entire and !ina' a:reement o! the 2artners with re:ard to the 2artnership and no representations" warranties" a:reements" &nderstandin:s" ver%a' or otherwise" e=ist %etween the 2artners e=cept as herein e=press'# set o&t. 7.8 A)e -)e !#.

5o amendment" a'teration" chan:e" ;&a'i!ication or modi!ication o! this 3:reement sha'' %e va'id &n'ess it is in writin: and si:ned %# each 2artner hereto and an# s&ch amendment" a'teration" chan:e" ;&a'i!ication or modi!ication sha'' %e adhered to and have the same e!!ect as i! the# had %een ori:ina''# em%odied in and !ormed a part o! this 3:reement. 7.9 Ti)e. -ime is o! the essence o! this 3:reement and o! ever# part hereo!. 7.; F%(!*e( A##%(& $e#.

-he 2artners hereto" and each o! them" covenant and a:ree that each o! them sha'' and wi''" &pon reasona%'e re;&est o! the other 2artners" maAe" do" e=ec&te or ca&se to %e made" done or e=ec&ted a'' s&ch !&rther and other 'aw!&' acts" deeds" thin:s" devices and ass&rances whatsoever !or the %etter or more per!ect and a%so'&te per!ormance o! the terms and conditions o! this 3:reement. 7.1< E %(e)e !.

-his 3:reement and the provisions hereo! sha'' en&re to the %ene!it o! and sha'' %e %indin: &pon the parties hereto and their respective s&ccessors and permitted assi:ns. 7.11 C"% !e(0&(!#.

-his 3:reement ma# %e e=ec&ted in co&nterparts" each o! which sha'' %e deemed to %e an ori:ina' and a'' o! which taAen to:ether sha'' constit&te one and the same a:reement.

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-DIN WITNESS WHEREOF the parties hereto have d&'# e=ec&ted this 3:reement this da# o! [ ]" to %e e!!ective as o! the !!ective 6ate in accordance with 1ection 6.5 o! this 3:reement. [ ] 2er: 5ame: -it'e: 2er: 5ame: -it'e:

[ ] 2er: 5ame: -it'e: 2er: 5ame: -it'e: