Item 6. Indemnification of Directors
and Officers.
Section 124 of the
Business Corporations Act
(Alberta) provides that except in respect of an action by or on behalf of the Company to procure
a judgment in the Company's favor, the Company may indemnify a director or officer of the Company, a former director or officer
of the Company, or a person who acts or acted at the Company's request as a director or officer of another corporation of which
the Company is or was a shareholder or creditor, and the director's or officer's heirs and legal representatives, referred herein
as the indemnified persons, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a
judgment, reasonably incurred by the director or officer in respect of any civil, criminal or administrative action or proceeding
to which the director or officer is made a party by reason of being or having been a director or officer of the Company (or such
other corporation), if: (a) the director or officer acted honestly and in good faith with a view to the best interests of the Company,
and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the director or
officer had reasonable grounds for believing that the director's or officer's conduct was lawful.
The Company may also,
under the
Business Corporations Act
(Alberta), with court approval, indemnify an indemnified person in respect of an action
by or on behalf of the Company to procure a judgment in its favor, to which the person is made a party by reason of being or having
been a director or an officer of the Company, against all costs, charges and expenses reasonably incurred by the person in connection
with the action if the person fulfills the conditions set out in (a) and (b) above.
An indemnified person
is entitled to indemnity from the Company in respect of all costs, charges and expenses reasonably incurred by the person in connection
with the defense of any civil, criminal, or administrative action or proceeding to which the person is made a party by reason of
being or having been a director or officer of the Company, if the person is seeking indemnity: (i) was substantially successful
on the merits in the person's defense of the action or proceeding, (ii) fulfills conditions set out in (a) and (b) above and (iii)
is fairly and reasonably entitled to indemnity. The Company is permitted under the
Business Corporations Act
(Alberta) to
advance funds to a person in order to defray the costs, charges and expenses of such a proceeding, but if the person does not meet
the conditions described in this paragraph, he or she shall repay the funds advanced.
Under the
Business
Corporations Act
(Alberta) the Company may purchase and maintain insurance for the benefit of indemnified persons against any
liability incurred by the person (i) in the person's capacity as a director or officer of the Company, except when the liability
relates to the person's failure to act honestly and in good faith with a view to the best interests of the Company, or (ii) in
the person's capacity as a director or officer of another body corporate if the person acts or acted in that capacity at the Company's
request, except when the liability relates to the person's failure to act honestly and in good faith with a view to the best interests
of the body corporate.
The Company or an indemnified
person may apply to the Court for an order approving an indemnity and the Court may so order and make any further order it thinks
fit. On an application, the Court may order notice to be given to any interested person and that person is entitled to appear and
be heard in person or by counsel.
The Company's bylaws
provide that directors and officers will not be liable for loss or damage in the execution of their duties unless such loss or
damage is occasioned by such director’s or officer’s failure to exercise the powers and to discharge the duties honestly,
in good faith and with a view to the best interests of the Company and to exercise the care, diligence and skill that a reasonably
prudent person would exercise in comparable circumstances.
To the fullest extent
permitted by the
Business Corporations Act
(Alberta) or otherwise by law, directors and officers are indemnified against
all costs, charges and expenses, including amounts paid to settle an action or satisfy a judgment in respect of any civil, criminal,
administrative, investigative or other proceeding to which the director or officer is made a party by reason of being or having
been a director or officer of the Company. The termination or settlement of any civil, criminal or administrative claim shall not,
of itself, create a presumption either that the director or officer did not act honestly and in good faith with a view to the best
interests of the Company or other entity, or that, in the case of criminal or administrative action or proceeding that is enforced
by a monetary penalty, the director or officer did not have reasonable grounds for believing that his or her conduct was lawful.
The Company shall,
to the maximum extent permitted by the
Business Corporations Act
(Alberta) or otherwise by law, advance moneys to a director
or officer to defray the costs, charges and expenses of a proceeding, provided such director or officer shall repay the moneys
advanced if the individual does not fulfill the conditions set forth in the
Business Corporations Act
(Alberta).
The Company has written
indemnification agreements with its directors and officers. Under these agreements, the Company indemnifies directors and officers
against all losses that the director or officer may reasonably suffer or incur in respect of any threatened, pending or completed
civil, criminal or administrative action or other proceeding (including formal and informal inquiries and hearings) to which the
individual is involved because of the individual having served as a director and/or officer of the Company, other than fines or
other obligations or fees that the Company is prohibited by applicable law from paying by way of indemnification. Under the indemnification
agreements the Company agrees to use its reasonable best efforts to maintain a comprehensive directors’ and officers’
insurance policy with respect to liability relating to its directors and officers.
Under the Company’s
indemnification agreements, the Company is not liable to indemnify directors and officers under certain circumstances. The Company
will not indemnify directors and officers with respect to losses: (i) for which payment is actually made to such director or officer
under a valid and collectible insurance policy; (ii) for which such director or officer is indemnified by the Company (or a company
of which the Company is a direct or indirect shareholder of creditor) otherwise than pursuant to their indemnity agreement; or
(iii) to the extent such losses were suffered or incurred as a result of acts of such director or officers which are determined
by a court of competent jurisdiction to have been: (A) acts of active and deliberate dishonest, (B) undertaken with actual dishonest
purpose and intent, and (C) material to the cause of action in which adjudicated.
The Company has obtained
directors' and officers’ insurance to cover its directors and officers for certain liabilities.
We maintain a general liability insurance
policy that covers certain liabilities of directors and officers of the Company arising out of claims based on acts or omissions
in their capacities as directors or officers.
Insofar as indemnification for liabilities
arising under the Securities Act may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in the opinion of the SEC, such indemnification is against public policy
as expressed in the Securities Act, and is, therefore, unenforceable.
Item 9. Undertakings.
(a) The
Registrant hereby undertakes:
(1) To
file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:
(i) To
include any prospectus required by Section 10(a)(3) of the Securities Act;
(ii) To
reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price
set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii) To
include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration Statement;
Provided, however
, that paragraphs (a)(1)(i)
and (a)(1)(ii) herein do not apply if the information required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to the SEC by the Registrant pursuant to Section 13 or Section 15(d)
of the Exchange Act that are incorporated by reference in the Registration Statement;
(2) That,
for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall
be deemed to be the initial
bona fide
offering thereof.
(3) To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The Registrant
hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant’s
annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit
plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to the directors, officers, and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion
of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer, or controlling person in connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will
be governed by final adjudication of such issue.