Common use of Inactive Shareholders Clause in Contracts

Inactive Shareholders. A Shareholder is an inactive Shareholder (an “Inactive Shareholder”) following the occurrence of any of the following events (each an “Inactive Event”): the Shareholder is subject to a Triggering Event and becomes a Defaulting Party, but remains a Shareholder following the application of Section 6.3; the death of a Shareholder or Principal; or the Shareholder or Principal resigns his or her employment with the Corporation or the employment is terminated by the Corporation for any reason or cause. Each Inactive Shareholder must give notice to the Corporation promptly following the occurrence of an Inactive Event. If a Shareholder becomes an Inactive Shareholder, then from the date of the Inactive Event, the Inactive Shareholder and its Permitted Transferees: have no right to receive information about the Corporation under ‎Section 3.10 of this Agreement or otherwise, except as required under the Act and this Agreement; have no right to subscribe for any offering under ‎Section 6.1; to the extent they are not already a Minority Shareholder, their Shares shall be subject to the voting power of attorney in ‎Section 3.8 in the same manner as if they were Minority Shareholders for as long as the Shares are held by the Inactive Shareholder or its Permitted Transferees; and in the case of Section 7.3(1)(a), will be obliged at the sole option of the Corporation, exercisable by the Corporation within [90 days] after employment ceases, to sell all of the Shares of that Inactive Shareholder at fair market value to the Corporation or as the Corporation may direct. Fair market value shall be determined by negotiation, and failing a negotiated price by a third party arbitrator selected and paid [equally] by the Corporation and by the Inactive Shareholder selling the Shares. If the Shares of the Inactive Shareholder are also subject to repurchase rights under the ESOP, the Corporation shall be entitled to elect whether to apply the provisions of this Agreement or the ESOP in respect of all the Shares held by the Inactive Shareholder. GENERAL

Inactive Shareholders. (a) A Shareholder is shall be deemed to be an inactive Inactive Shareholder (an “Inactive Shareholder”) immediately following the occurrence of any of the following events (each an a “Inactive Triggering Event”): the Shareholder is subject to a Triggering Event and becomes a Defaulting Party, but remains ): (i) if a Shareholder following the application of Section 6.3; the death or related Principal of a Shareholder dies; (ii) if a Shareholder or Principalrelated Principal of a Shareholder suffers Permanent Incapacity; (iii) if a Shareholder or related Principal of a Shareholder voluntarily retires as an employee of the Corporation or if the employment of the Shareholder or the related Principal resigns his or her employment with the Corporation or the employment is terminated by the Corporation for any reason legal cause; or cause(iv) if the employment of the Shareholder or related Principal of a Shareholder is terminated other than as provided in Sections 8. 1(a)(i), 8. 1(a)(ii) and 8. l(a)(iii). (b) Each Inactive Shareholder must or the legal personal representatives of the Shareholder, (the “Representative”), as the case may be, shall give notice in writing to the Corporation promptly following the occurrence of an Inactive a Triggering Event. If . (c) From and after the date that a Shareholder becomes an Inactive Shareholder, then the right of such Shareholder to nominate any Directors shall be suspended and any nominee Director of such Inactive Shareholder shall resign from the date Board of Directors; and the Inactive Event, the Inactive Shareholder and its Permitted Transferees: have no right to receive information about the Corporation under ‎Section 3.10 votes of this Agreement or otherwise, except as required under the Act and this Agreement; have no right to subscribe for any offering under ‎Section 6.1; to the extent they are not already a Minority Shareholder, their Shares shall be subject to the voting power of attorney in ‎Section 3.8 in the same manner as if they were Minority Shareholders for as long as the Shares are held by the Inactive such Shareholder or its Permitted Transferees; and in nominee Directors or both of them, as the case may be, shall be excluded for purposes of Section 7.3(1)(a)determining whether a decision, will be obliged at action or matter has been approved by Extraordinary Resolution. (d) Any determination that the sole option employment of a Shareholder or related Principal of a Shareholder has been terminated for legal cause shall require approval by Extraordinary Resolution, provided that in this instance the Corporation, exercisable Shareholder that is affected by the Corporation within [90 days] after employment ceases, to sell all of the Shares of that Inactive Shareholder at fair market value to the Corporation or as the Corporation may direct. Fair market value determination shall be determined by negotiation, and failing a negotiated price by a third party arbitrator selected and paid [equally] by the Corporation and by the Inactive Shareholder selling the Shares. If the Shares of the Inactive Shareholder are also subject to repurchase rights under the ESOP, the Corporation shall not be entitled to elect whether to apply the provisions of this Agreement or the ESOP in respect of all vote and the Shares held owned by such Shareholder shall be excluded when calculating the Inactive Shareholder. GENERALpercentage of votes required to approve the determination. (e) The Corporation shall have no liability to any Shareholder or any related Principal of a Shareholder arising from the termination of their employment with the Corporation either hereunder or under any employment agreement except for payment of any amount payable pursuant to this Section.