Common use of Board Nomination Rights Clause in Contracts

Board Nomination Rights. i. Notwithstanding anything to the contrary contained in any definitive agreement or other transaction document pertaining to the Qualifying Transaction and subject to the rules of any securities exchange on which the subordinate, restricted and limited voting shares in the capital of the Corporation (and any other share into which they convert or are otherwise exchanged, the “Shares”) may trade on or after the closing of the Qualifying Transaction, from and after the Closing until the date that is three (3) years after the closing date of the Qualifying Transaction the Sponsor, the Corporation and the Sellers shall take all reasonable actions (to the extent such actions are not prohibited by applicable law and within such Party’s control, and in the case of any action that requires a vote or other action on the part of the Board, to the extent such action is consistent with fiduciary duties that the Corporation directors may have in such capacity) which are necessary (“Necessary Action”) to cause the Board to be comprised of eight (8) directors and for those individuals to be nominated in accordance with this Section 1.1 as follows: a. The Sponsor shall, until the earlier to occur of (x) the date that is three (3) years after the closing date of the Qualifying Transaction and (y) the date upon which the Sponsor ceases to own at least 50% of the Shares owned by it at closing of the Qualifying Transaction (assuming forfeited shares continue to be owned), be entitled to nominate one (1) individual (the “Sponsor’s Director Nominee”), who shall initially be Jxxxx Xxxxxxx. b. Two (2) independent directors (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) shall be nominated upon the unanimous consent of Kxxx Xxxxx, Gxxxxx Xxxxxx, and the Sponsor (the “Independent Director Nominees”), which directors shall initially be Hxxxxx De La Txxxx and Gxxxxx Xxxxxxxx. c. The Sellers shall be entitled to nominate four (4) individuals (the “Seller Director Nominees”), which directors shall initially be Kxxx Xxxxx, Gxxxxx Xxxxxx and two additional nominees who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110), which additional nominees shall be Jxxxxxx Xxxxxxxxx and Humble Lukanga. d. Element 7 CA, LLC (“Element 7”) shall be entitled to nominate one (1) individual who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) (the “E7 Director Nominee”, and together with the Sponsor’s Director Nominee, the Independent Director Nominees, and the Seller Director Nominees, the “Nominees”), who shall initially be Bxx Xxxxx. ii. The Parties shall be entitled to nominate their respective nominees as set forth in Section 1.1.i for election to the board of directors (the “Board”) at the applicable Corporation shareholders meeting by written notice to the Corporation given (i) in the case of an annual meeting of the shareholders of the Corporation, no less than 60 days prior to the one-year anniversary of the preceding year’s annual meeting date (provided, however, that, if no annual meeting of the Corporation’s shareholders was held in the preceding year, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of such meeting was first made by the Corporation); provided, further, that if the date of the annual meeting of the shareholders of the Corporation is more than thirty (30) days before or more than sixty (60) days after such anniversary date, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation), and (ii) in the case of a special meeting of the shareholders of the Corporation, not less than the later of 60 days prior to such special meeting or the tenth (10) day following the day on which public disclosure of the date of such special meeting was first made by the Corporation, which such notice shall include all information relating to the applicable Nominee(s) that is required to be disclosed in a proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors by a dissident in a contested election pursuant to Part 9 of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”), any other applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (including such applicable Nominee’s written consent to being named in the proxy circular as a nominee and to serving as a director if elected). If the applicable Parties shall elect to nominate a Nominee as provided in this Section 1.1, the Corporation shall, unless such Nominee fails to qualify to act as a director of the Corporation pursuant to the requirements of applicable law, including applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (i) include such Nominee as a nominee for election as a director of the Board at the applicable Corporation shareholders meeting in the Corporation’s proxy solicitation materials (including any form of proxy the Corporation distributes); and (ii) recommend to the Corporation’s shareholders that they vote in favor of such Nominee at such Corporation shareholders meeting. iii. For the avoidance of doubt, no Party shall be subject to any requirement that shareholders provide advance notice of, or comply with any other procedures governing, the nomination of individuals for election to the Board as provided in the Corporation’s articles, and each Nominee shall otherwise be nominated and remain a member of the Board in accordance with the Corporation’s articles and other policies determined from time to time by the Board for nominating directors. iv. Any Nominee must be qualified to act as a director of the Corporation pursuant to the applicable requirements under applicable law, including applicable Canadian securities laws, the rules of any securities exchange on which the Shares are then listed, and in compliance with any other applicable law and the Corporation’s articles. v. In the event that the applicable Parties do not nominate a Nominee at a particular meeting as provided in this Section 1.1, then the Corporation shall proceed with the applicable Corporation shareholder meeting and all further rights of such Parties to nominate such Nominee for election at such meeting shall terminate without any further action of the Parties. vi. In the event that the Parties entitled to nominate a Nominee desire to remove such Nominee from the Board, all of the other Parties shall, upon written notice from the Parties desiring such removal, take all Necessary Action to cause such Nominee to be removed. At such time as the Sponsor is no longer entitled to nominate a Nominee pursuant to Section 1.1.i.a, the Sponsor and the Corporation shall if requested by a majority of the remaining Nominees take all Necessary Action to cause the Sponsor’s Director Nominee to tender his or her resignation. vii. Any Nominee shall be subject to the Corporation’s customary due diligence process, including its review of a customary questionnaire and background check. Based on the foregoing, the Corporation may reasonably object to any such Nominee within fifteen (15) days of receiving such completed questionnaire and background check authorization, (a) provided it does so in good faith and (b) solely to the extent such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (ii) such Nominee was the subject of any order, judgment or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such Nominee from, or otherwise limiting his or her ability to, engage in (x) any type of business practice or (y) any activity in connection with the purchase or sale of any security or in connection with any violation of applicable securities laws; (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal, state or provincial authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in clause (ii)(y), or to be associated with persons engaged in such activity; (iv) such Nominee was found by a court of competent jurisdiction in a civil action or by applicable securities authorities to have violated any federal, state or provincial securities law, and the judgment in such civil action or finding by such authorities has not been subsequently reversed, suspended or vacated; or (v) such Nominee was the subject of, or a party to, any federal, state or provincial judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal, state or provincial securities laws or regulations. In the event the Board reasonably finds any such Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to such Nominee, the Party(ies) that nominated such Nominee shall be entitled to propose a different Nominee to the Board within fifteen (15) days of the Corporation’s notice to such Party(ies) of its objection to such Nominee, and such replacement Nominee shall be subject to the review process outlined in this Section 1.1.vii.

Board Nomination Rights. i. Notwithstanding anything (a) From the Effective Date, HGGC shall have the right, but not the obligation, to nominate to the contrary contained in any definitive agreement or other transaction document pertaining Board a number of designees equal to the Qualifying Transaction and subject to the rules of any securities exchange on which the subordinate, restricted and limited voting shares in the capital at least: (i) 60% of the Corporation Total Number of Directors (and any other share into which they convert or are otherwise exchangedas defined below), the “Shares”) may trade on or after the closing so long as HGGC Beneficially Owns shares of Common Stock representing at least 45% of the Qualifying Transaction, from and after the Closing until the date that is three (3) years after the closing date total voting power of the Qualifying Transaction the Sponsorthen outstanding Common Stock, the Corporation and the Sellers shall take all reasonable actions (to the extent such actions are not prohibited by applicable law and within such Party’s control, and in the case of any action that requires a vote or other action on the part of the Board, to the extent such action is consistent with fiduciary duties that the Corporation directors may have in such capacityii) which are necessary (“Necessary Action”) to cause the Board to be comprised of eight (8) directors and for those individuals to be nominated in accordance with this Section 1.1 as follows: a. The Sponsor shall, until the earlier to occur of (x) the date that is three (3) years after the closing date of the Qualifying Transaction and (y) the date upon which the Sponsor ceases to own at least 50% of the Shares owned by it Total Number of Directors, so long as HGGC Beneficially Owns shares of Common Stock representing less than 45% but at closing least 35% of the Qualifying Transaction total voting power of the then outstanding Common Stock, (assuming forfeited iii) 40% of the Total Number of Directors, so long HGGC Beneficially Owns shares continue to be owned)of Common Stock representing less than 35% but at least 25% of the total voting power of the then outstanding Common Stock, be entitled to nominate one (1iv) individual 30% of the Total Number of Directors, in the event that HGGC Beneficially Owns shares of Common Stock representing less than 25% but at least 15% of the total voting power of the then outstanding Common Stock, and (v) 20% of the Total Number of Directors, in the event that HGGC Beneficially Owns shares of Common Stock representing less than 15% but at least 5% of the total voting power of the then outstanding Common Stock (such persons, the “Sponsor’s Director Nominee”), who shall initially be Jxxxx Xxxxxxx. b. Two (2) independent directors (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) shall be nominated upon the unanimous consent of Kxxx Xxxxx, Gxxxxx Xxxxxx, and the Sponsor (the “Independent Director HGGC Nominees”). For purposes of calculating the number of directors that HGGC is entitled to designate pursuant to the immediately preceding sentence, which directors any fractional amounts shall initially automatically be Hxxxxx De La Txxxx rounded up to the nearest whole number (e.g., 11⁄4 Directors shall equate to 2 Directors) and Gxxxxx Xxxxxxxxany such calculations shall be made after taking into account any increase in the Total Number of Directors. c. The Sellers (b) From the Effective Date, M&S shall be entitled have the right, but not the obligation, to nominate four to the Board a number of designees equal to at least: (4i) individuals 40% of the Total Number of Directors (as defined below), so long as M&S Beneficially Owns shares of Common Stock representing at least 25% of the total voting power of the then outstanding Common Stock, (ii) 30% of the Total Number of Directors, in the event that M&S Beneficially Owns shares of Common Stock representing less than 25% but at least 15% of the total voting power of the then outstanding Common Stock, and (iii) 20% of the Total Number of Directors, in the event that M&S Beneficially Owns shares of Common Stock representing less than 15% but at least 5% of the total voting power of the then outstanding Common Stock (such persons, the “Seller Director M&S Nominees”), which directors shall initially be Kxxx Xxxxx, Gxxxxx Xxxxxx and two additional nominees who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110), which additional nominees shall be Jxxxxxx Xxxxxxxxx and Humble Lukanga. d. Element 7 CA, LLC (“Element 7”) shall be entitled to nominate one (1) individual who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) (the “E7 Director Nominee”, ,” and together with the Sponsor’s Director Nominee, the Independent Director Nominees, and the Seller Director HGGC Nominees, the “Nominees”). For purposes of calculating the number of directors that M&S is entitled to designate pursuant to the immediately preceding sentence, who any fractional amounts shall automatically be rounded down to the nearest whole number (e.g., 11⁄4 Directors shall equate to 1 Director) and any such calculations shall be made after taking into account any increase in the Total Number of Directors. (c) The Directors shall be divided into three classes of directors, each of whose members shall serve for staggered three-year terms in accordance with the Company’s certificate of incorporation. One HGGC nominee will initially be Bxx Xxxxxallocated to each of the three classes. ii. The Parties (d) In the event that any Lead Sponsor has nominated less than the total number of designees that such Lead Sponsor shall be entitled to nominate their respective nominees as set forth pursuant to Section 1(a) or Section 1(b), such Lead Sponsor shall have the right, at any time, to nominate such additional designees to which it is entitled, in Section 1.1.i for election which case, the Company and the Directors shall take all necessary corporation action, to the board fullest extent permitted by applicable law (including with respect to fiduciary duties under Delaware law), to (x) enable such Lead Sponsor to nominate and effect the election or appointment of directors (such additional individuals, whether by increasing the “Board”) at the applicable Corporation shareholders meeting by written notice to the Corporation given (i) in the case of an annual meeting size of the shareholders of the Corporation, no less than 60 days prior to the one-year anniversary of the preceding year’s annual meeting date (provided, however, that, if no annual meeting of the Corporation’s shareholders was held in the preceding year, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of such meeting was first made by the Corporation); provided, further, that if the date of the annual meeting of the shareholders of the Corporation is more than thirty (30) days before Board or more than sixty (60) days after such anniversary date, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation)otherwise, and (iiy) in the case of a special meeting of the shareholders of the Corporation, not less than the later of 60 days prior designate such additional individuals nominated by such Lead Sponsor to fill such special meeting newly created vacancies or the tenth (10) day following the day on which public disclosure of the date of such special meeting was first made by the Corporation, which such notice shall include all information relating to the applicable Nominee(s) that is required to be disclosed in a proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors by a dissident in a contested election pursuant to Part 9 of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”), fill any other applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (including such applicable Nominee’s written consent to being named in the proxy circular as a nominee and to serving as a director if elected). If the applicable Parties shall elect to nominate a Nominee as provided in this Section 1.1, the Corporation shall, unless such Nominee fails to qualify to act as a director of the Corporation pursuant to the requirements of applicable law, including applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (i) include such Nominee as a nominee for election as a director of the Board at the applicable Corporation shareholders meeting in the Corporation’s proxy solicitation materials (including any form of proxy the Corporation distributes); and (ii) recommend to the Corporation’s shareholders that they vote in favor of such Nominee at such Corporation shareholders meetingexisting vacancies. iii. For the avoidance of doubt, no Party (e) The Company shall be subject to pay all reasonable out-of-pocket expenses incurred by any requirement that shareholders provide advance notice of, or comply with any other procedures governing, the nomination of individuals for election to the Board as provided in the Corporation’s articles, and each Nominee shall otherwise be nominated and remain a member of the Board in accordance with the Corporation’s articles and other policies determined from time to time by the Board for nominating directors. iv. Any Nominee must be qualified to act as a director of the Corporation pursuant to the applicable requirements under applicable law, including applicable Canadian securities laws, the rules of any securities exchange on which the Shares are then listed, and in compliance with any other applicable law and the Corporation’s articles. v. In the event that the applicable Parties do not nominate a Nominee at a particular meeting as provided in this Section 1.1, then the Corporation shall proceed with the applicable Corporation shareholder meeting and all further rights of such Parties to nominate such Nominee for election at such meeting shall terminate without any further action of the Parties. vi. In the event that the Parties entitled to nominate a Nominee desire to remove such Nominee from the Board, all of the other Parties shall, upon written notice from the Parties desiring such removal, take all Necessary Action to cause such Nominee to be removed. At such time as the Sponsor is no longer entitled to nominate a Nominee pursuant to Section 1.1.i.a, the Sponsor and the Corporation shall if requested by a majority of the remaining Nominees take all Necessary Action to cause the Sponsor’s Director Nominee to tender his or her resignation. vii. Any Nominee shall be subject to the Corporation’s customary due diligence process, including its review of a customary questionnaire and background check. Based on the foregoing, the Corporation may reasonably object to any such Nominee within fifteen (15) days of receiving such completed questionnaire and background check authorization, (a) provided it does so in good faith and (b) solely to the extent such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (ii) such Nominee was the subject of any order, judgment or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such Nominee from, or otherwise limiting his or her ability to, engage in (x) any type of business practice or (y) any activity in connection with the purchase performance of his or sale of any security or her duties as a director and in connection with his or her attendance at any violation of applicable securities laws; (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal, state or provincial authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in clause (ii)(y), or to be associated with persons engaged in such activity; (iv) such Nominee was found by a court of competent jurisdiction in a civil action or by applicable securities authorities to have violated any federal, state or provincial securities law, and the judgment in such civil action or finding by such authorities has not been subsequently reversed, suspended or vacated; or (v) such Nominee was the subject of, or a party to, any federal, state or provincial judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal, state or provincial securities laws or regulations. In the event the Board reasonably finds any such Nominee to be unsuitable based upon one or more meeting of the foregoing clauses (i) through (v) and reasonably objects to such Nominee, the Party(ies) that nominated such Nominee shall be entitled to propose a different Nominee to the Board within fifteen (15) days of the Corporation’s notice to such Party(ies) of its objection to such Nominee, and such replacement Nominee shall be subject to the review process outlined in this Section 1.1.viiBoard.

Board Nomination Rights. i. Notwithstanding anything to the contrary contained in any definitive agreement or other transaction document pertaining to the Qualifying Transaction and subject to the rules of any securities exchange on which the subordinate, restricted and limited voting shares in the capital of the Corporation (and any other share into which they convert or are otherwise exchanged, the “Shares”) may trade on or after the closing of the Qualifying Transaction, from and after the Closing until the date that is three (3) years after the closing date of the Qualifying Transaction the Sponsor, the Corporation and the Sellers shall take all reasonable actions (to the extent such actions are not prohibited by applicable law and within such Party’s control, and in the case of any action that requires a vote or other action on the part of the Board, to the extent such action is consistent with fiduciary duties that the Corporation directors may have in such capacity) which are necessary (“Necessary Action”) to cause the Board to be comprised of eight (8) directors and for those individuals to be nominated in accordance with this Section 1.1 as follows: a. The Sponsor shall, until the earlier to occur of (x) the date that is three (3) years after the closing date of the Qualifying Transaction and (y) the date upon which the Sponsor ceases to own at least 50% of the Shares owned by it at closing of the Qualifying Transaction (assuming forfeited shares continue to be owned), be entitled to nominate one (1) individual (the “Sponsor’s Director Nominee”), who shall initially be Jxxxx Xxxxxxx. b. Two (2) independent directors (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) shall be nominated upon the unanimous consent of Kxxx Xxxxx, Gxxxxx Xxxxxx, and the Sponsor (the “Independent Director Nominees”), which directors shall initially be Hxxxxx De La Txxxx Torre and Gxxxxx Xxxxxxxx. c. The Sellers shall be entitled to nominate four (4) individuals (the “Seller Director Nominees”), which directors shall initially be Kxxx Xxxxx, Gxxxxx Xxxxxx and two additional nominees who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110), which additional nominees shall be Jxxxxxx Xxxxxxxxx and Humble Lukanga. d. Element 7 CA, LLC (“Element 7”) shall be entitled to nominate one (1) individual who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) (the “E7 Director Nominee”, and together with the Sponsor’s Director Nominee, the Independent Director Nominees, and the Seller Director Nominees, the “Nominees”), who shall initially be Bxx Xxxxx. ii. The Parties shall be entitled to nominate their respective nominees as set forth in Section 1.1.i for election to the board of directors (the “Board”) at the applicable Corporation shareholders meeting by written notice to the Corporation given (i) in the case of an annual meeting of the shareholders of the Corporation, no less than 60 days prior to the one-year anniversary of the preceding year’s annual meeting date (provided, however, that, if no annual meeting of the Corporation’s shareholders was held in the preceding year, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of such meeting was first made by the Corporation); provided, further, that if the date of the annual meeting of the shareholders of the Corporation is more than thirty (30) days before or more than sixty (60) days after such anniversary date, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation), and (ii) in the case of a special meeting of the shareholders of the Corporation, not less than the later of 60 days prior to such special meeting or the tenth (10) day following the day on which public disclosure of the date of such special meeting was first made by the Corporation, which such notice shall include all information relating to the applicable Nominee(s) that is required to be disclosed in a proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors by a dissident in a contested election pursuant to Part 9 of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”), any other applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (including such applicable Nominee’s written consent to being named in the proxy circular as a nominee and to serving as a director if elected). If the applicable Parties shall elect to nominate a Nominee as provided in this Section 1.1, the Corporation shall, unless such Nominee fails to qualify to act as a director of the Corporation pursuant to the requirements of applicable law, including applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (i) include such Nominee as a nominee for election as a director of the Board at the applicable Corporation shareholders meeting in the Corporation’s proxy solicitation materials (including any form of proxy the Corporation distributes); and (ii) recommend to the Corporation’s shareholders that they vote in favor of such Nominee at such Corporation shareholders meeting. iii. For the avoidance of doubt, no Party shall be subject to any requirement that shareholders provide advance notice of, or comply with any other procedures governing, the nomination of individuals for election to the Board as provided in the Corporation’s articles, and each Nominee shall otherwise be nominated and remain a member of the Board in accordance with the Corporation’s articles and other policies determined from time to time by the Board for nominating directors. iv. Any Nominee must be qualified to act as a director of the Corporation pursuant to the applicable requirements under applicable law, including applicable Canadian securities laws, the rules of any securities exchange on which the Shares are then listed, and in compliance with any other applicable law and the Corporation’s articles. v. In the event that the applicable Parties do not nominate a Nominee at a particular meeting as provided in this Section 1.1, then the Corporation shall proceed with the applicable Corporation shareholder meeting and all further rights of such Parties to nominate such Nominee for election at such meeting shall terminate without any further action of the Parties. vi. In the event that the Parties entitled to nominate a Nominee desire to remove such Nominee from the Board, all of the other Parties shall, upon written notice from the Parties desiring such removal, take all Necessary Action to cause such Nominee to be removed. At such time as the Sponsor is no longer entitled to nominate a Nominee pursuant to Section 1.1.i.a, the Sponsor and the Corporation shall if requested by a majority of the remaining Nominees take all Necessary Action to cause the Sponsor’s Director Nominee to tender his or her resignation. vii. Any Nominee shall be subject to the Corporation’s customary due diligence process, including its review of a customary questionnaire and background check. Based on the foregoing, the Corporation may reasonably object to any such Nominee within fifteen (15) days of receiving such completed questionnaire and background check authorization, (a) provided it does so in good faith and (b) solely to the extent such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (ii) such Nominee was the subject of any order, judgment or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such Nominee from, or otherwise limiting his or her ability to, engage in (x) any type of business practice or (y) any activity in connection with the purchase or sale of any security or in connection with any violation of applicable securities laws; (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal, state or provincial authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in clause (ii)(y), or to be associated with persons engaged in such activity; (iv) such Nominee was found by a court of competent jurisdiction in a civil action or by applicable securities authorities to have violated any federal, state or provincial securities law, and the judgment in such civil action or finding by such authorities has not been subsequently reversed, suspended or vacated; or (v) such Nominee was the subject of, or a party to, any federal, state or provincial judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal, state or provincial securities laws or regulations. In the event the Board reasonably finds any such Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to such Nominee, the Party(ies) that nominated such Nominee shall be entitled to propose a different Nominee to the Board within fifteen (15) days of the Corporation’s notice to such Party(ies) of its objection to such Nominee, and such replacement Nominee shall be subject to the review process outlined in this Section 1.1.vii.

Board Nomination Rights. i. Notwithstanding anything to (a) From the contrary contained in any definitive agreement or other transaction document pertaining to the Qualifying Transaction and subject to the rules of any securities exchange on which the subordinate, restricted and limited voting shares in the capital of the Corporation (and any other share into which they convert or are otherwise exchanged, the “Shares”) may trade on or after the closing of the Qualifying Transaction, from and after the Closing Effective Date until the date that is three (3) years after the closing date Investor ceases to Beneficially Own shares of Common Stock representing at least 10% of the Qualifying Transaction total voting power of the Sponsorthen outstanding Common Stock, the Corporation and the Sellers shall take all reasonable actions (to the extent such actions are not prohibited by applicable law and within such Party’s control, and in the case of any action that requires a vote or other action on the part at every meeting of the Board, or a committee thereof, for which directors of the Company are appointed by the Board or are nominated to stand for election by stockholders of the Company, Investor shall have the right to appoint or nominate for election to the extent Board, as applicable, such action number of representatives that, when compared to the authorized number of directors on the Board, is consistent with fiduciary duties closest to but not less than proportional to the total number of shares of Common Stock over which Investor retains direct or indirect voting control relative to the total number of shares of Common Stock then issued and outstanding (which, for the avoidance of doubt, shall mean that the Corporation directors may have in such capacity) which are necessary (“Necessary Action”) to cause the Board to be comprised number of eight (8) directors and for those individuals to be nominated in accordance with this Section 1.1 as follows: a. The Sponsor shall, until the earlier to occur of (x) the date that is three (3) years after the closing date of the Qualifying Transaction and (y) the date upon which the Sponsor ceases to own at least 50% of the Shares owned by it at closing of the Qualifying Transaction (assuming forfeited shares continue to be owned), be entitled to nominate one (1) individual (the “Sponsor’s Director Nominee”), who shall initially be Jxxxx Xxxxxxx. b. Two (2) independent directors (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) representatives shall be nominated upon rounded up to the unanimous consent of Kxxx Xxxxx, Gxxxxx Xxxxxx, and the Sponsor (the “Independent Director Nominees”), which directors shall initially be Hxxxxx De La Txxxx and Gxxxxx Xxxxxxxx. c. The Sellers shall be entitled to nominate four (4) individuals (the “Seller Director Nominees”), which directors shall initially be Kxxx Xxxxx, Gxxxxx Xxxxxx and two additional nominees who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110), which additional nominees shall be Jxxxxxx Xxxxxxxxx and Humble Lukanga. d. Element 7 CA, LLC (“Element 7”) shall be entitled to nominate one (1) individual who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110next whole number in all cases) (the “E7 Director Nominee”, and together with the Sponsor’s Director Nominee, the Independent Director Nominees, and the Seller Director Nomineessuch persons, the “Nominees”). “Beneficially Own” shall mean that a specified person has or shares the right, who directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, to vote shares of capital stock of the Company. No reduction in the number of shares of Common Stock over which Investor retains voting control shall initially be Bxx Xxxxx. iishorten the term of any incumbent director). The Parties At the Effective Date, the Board shall be entitled to nominate their respective nominees as set forth in Section 1.1.i for election to the board comprised of directors (the “Board”) at the applicable Corporation shareholders meeting by written notice to the Corporation given (i) in the case of an annual meeting of the shareholders of the Corporation, no less than 60 days prior to the one-year anniversary of the preceding year’s annual meeting date (provided, however, that, if no annual meeting of the Corporation’s shareholders was held in the preceding year, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of such meeting was first made by the Corporation); provided, further, that if the date of the annual meeting of the shareholders of the Corporation is more than thirty (30) days before or more than sixty (60) days after such anniversary date, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation), and (ii) in the case of a special meeting of the shareholders of the Corporation, not less than the later of 60 days prior to such special meeting or the tenth (10) day following the day on which public disclosure of the date of such special meeting was first made by the Corporation, which such notice shall include all information relating to the applicable Nominee(s) that is required to be disclosed in a proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors by a dissident in a contested election pursuant to Part 9 of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”), any other applicable Canadian securities laws eight members and the rules and regulations of the securities exchange on which the Shares are then listed (including such applicable Nominee’s written consent to being named in the proxy circular as a nominee and to serving as a director if elected). If the applicable Parties shall elect to nominate a Nominee as provided in this Section 1.1, the Corporation shall, unless such Nominee fails to qualify to act as a director of the Corporation pursuant to the requirements of applicable law, including applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (i) include such Nominee as a nominee for election as a director of the Board at the applicable Corporation shareholders meeting in the Corporation’s proxy solicitation materials (including any form of proxy the Corporation distributes); and (ii) recommend to the Corporation’s shareholders that they vote in favor of such Nominee at such Corporation shareholders meeting. iii. For the avoidance of doubt, no Party initial Nominees shall be subject to any requirement that shareholders provide advance notice ofXxxx X. Xxxxxxx, or comply with any other procedures governingXxxxxxxxxxx X. XxXxxxx, the nomination of individuals for election to the Board Xxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxxxx and Xxxxxxx X. Xxxxxxx and Messrs. XxXxxxx, Xxxxxxx and Xxxxxxx shall be designated as provided in the Corporation’s articlesClass II directors and Messrs. Mencoff, Norton and each Nominee Souleles shall otherwise be nominated and remain a member of the Board in accordance with the Corporation’s articles and other policies determined from time to time by the Board for nominating designated as Class III directors. iv. Any Nominee must be qualified to act as a director of the Corporation pursuant to the applicable requirements under applicable law, including applicable Canadian securities laws, the rules of any securities exchange on which the Shares are then listed, and in compliance with any other applicable law and the Corporation’s articles. v. In the event that the applicable Parties do not nominate a Nominee at a particular meeting as provided in this Section 1.1, then the Corporation shall proceed with the applicable Corporation shareholder meeting and all further rights of such Parties to nominate such Nominee for election at such meeting shall terminate without any further action of the Parties. vi. In the event that the Parties entitled to nominate a Nominee desire to remove such Nominee from the Board, all of the other Parties shall, upon written notice from the Parties desiring such removal, take all Necessary Action to cause such Nominee to be removed. At such time as the Sponsor is no longer entitled to nominate a Nominee pursuant to Section 1.1.i.a, the Sponsor and the Corporation shall if requested by a majority of the remaining Nominees take all Necessary Action to cause the Sponsor’s Director Nominee to tender his or her resignation. vii. Any Nominee shall be subject to the Corporation’s customary due diligence process, including its review of a customary questionnaire and background check. Based on the foregoing, the Corporation may reasonably object to any such Nominee within fifteen (15) days of receiving such completed questionnaire and background check authorization, (a) provided it does so in good faith and (b) solely to the extent such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (ii) such Nominee was the subject of any order, judgment or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such Nominee from, or otherwise limiting his or her ability to, engage in (x) any type of business practice or (y) any activity in connection with the purchase or sale of any security or in connection with any violation of applicable securities laws; (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal, state or provincial authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in clause (ii)(y), or to be associated with persons engaged in such activity; (iv) such Nominee was found by a court of competent jurisdiction in a civil action or by applicable securities authorities to have violated any federal, state or provincial securities law, and the judgment in such civil action or finding by such authorities has not been subsequently reversed, suspended or vacated; or (v) such Nominee was the subject of, or a party to, any federal, state or provincial judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal, state or provincial securities laws or regulations. In the event the Board reasonably finds any such Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to such Nominee, the Party(ies) that nominated such Nominee shall be entitled to propose a different Nominee to the Board within fifteen (15) days of the Corporation’s notice to such Party(ies) of its objection to such Nominee, and such replacement Nominee shall be subject to the review process outlined in this Section 1.1.vii.

Board Nomination Rights. i. Notwithstanding anything (i) Upon the written request of the Majority Xxxxxx Investors to the contrary contained in Company at any definitive agreement or other transaction document pertaining time and from time to the Qualifying Transaction and subject to the rules of any securities exchange on which the subordinate, restricted and limited voting shares in the capital of the Corporation (and any other share into which they convert or are otherwise exchanged, the “Shares”) may trade on or time after the closing consummation of a Qualified Public Offering (which written request shall (x) reference this Section 1G, (y) specify the Qualifying Transaction, from and after the Closing until the date that is three (3) years after the closing date name of the Qualifying Transaction the Sponsor, the Corporation and the Sellers shall take all reasonable actions (to the extent such actions are not prohibited by applicable law and within such Party’s control, and in the case of any action that requires a vote or other action on the part of the Board, to the extent such action is consistent with fiduciary duties that the Corporation directors may have in such capacity) which are necessary (“Necessary Action”) to cause the Board to be comprised of eight (8) directors and for those individuals each individual to be nominated in accordance to the Board as a Xxxxxx Director and (z) demand that the Company comply with its obligations to nominate individuals to the Board as directed by the Majority Xxxxxx Investors pursuant to this Section 1.1 as follows: a. The Sponsor shall1G), until (a) at any time that the earlier to occur of (x) the date that is three (3) years after the closing date of the Qualifying Transaction and (y) the date upon which the Sponsor ceases to own Xxxxxx Investors hold at least 5030% of the Shares owned by it at closing outstanding shares of the Qualifying Transaction (assuming forfeited shares continue to be owned), be entitled to nominate one (1) individual (the “Sponsor’s Director Nominee”), who shall initially be Jxxxx Xxxxxxx. b. Two (2) independent directors (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) shall be nominated upon the unanimous consent of Kxxx Xxxxx, Gxxxxx Xxxxxx, and the Sponsor (the “Independent Director Nominees”), which directors shall initially be Hxxxxx De La Txxxx and Gxxxxx Xxxxxxxx. c. The Sellers shall be entitled to nominate four (4) individuals (the “Seller Director Nominees”), which directors shall initially be Kxxx Xxxxx, Gxxxxx Xxxxxx and two additional nominees who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110), which additional nominees shall be Jxxxxxx Xxxxxxxxx and Humble Lukanga. d. Element 7 CA, LLC (“Element 7”) shall be entitled to nominate one (1) individual who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) (the “E7 Director Nominee”, and together with the Sponsor’s Director NomineeCommon Stock, the Independent Director Nominees, and Majority Xxxxxx Investors shall have the Seller Director Nominees, the “Nominees”), who shall initially be Bxx Xxxxx. ii. The Parties shall be entitled to nominate their respective nominees as set forth in Section 1.1.i for election to the board of directors (the “Board”) at the applicable Corporation shareholders meeting by written notice to the Corporation given (i) in the case of an annual meeting of the shareholders of the Corporation, no less than 60 days prior to the one-year anniversary of the preceding year’s annual meeting date (provided, however, that, if no annual meeting of the Corporation’s shareholders was held in the preceding year, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of such meeting was first made by the Corporation); provided, further, that if the date of the annual meeting of the shareholders of the Corporation is more than thirty (30) days before or more than sixty (60) days after such anniversary date, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation), and (ii) in the case of a special meeting of the shareholders of the Corporation, not less than the later of 60 days prior to such special meeting or the tenth (10) day following the day on which public disclosure of the date of such special meeting was first made by the Corporation, which such notice shall include all information relating to the applicable Nominee(s) that is required to be disclosed in a proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors by a dissident in a contested election pursuant to Part 9 of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”), any other applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (including such applicable Nominee’s written consent to being named in the proxy circular as a nominee and to serving as a director if elected). If the applicable Parties shall elect right to nominate a Nominee as provided in this Section 1.1, the Corporation shall, unless such Nominee fails to qualify to act as a director of the Corporation pursuant to the requirements of applicable law, including applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (i) include such Nominee as a nominee for election as a director of the Board at the applicable Corporation shareholders meeting in the Corporation’s proxy solicitation materials (including any form of proxy the Corporation distributes); and (ii) recommend to the Corporation’s shareholders that they vote in favor of such Nominee at such Corporation shareholders meeting. iii. For the avoidance of doubt, no Party shall be subject to any requirement that shareholders provide advance notice of, or comply with any other procedures governing, the nomination number of individuals for election to the Board as provided in such that not less than 40% of the Corporation’s articlesDirectors (rounded up to the nearest whole number) shall be Xxxxxx Directors, (b) at any time that the Xxxxxx Investors hold at least 20% (but less than 30%) of the outstanding shares of Common Stock, the Majority Xxxxxx Investors shall have the right to nominate a number of individuals for election to the Board such that not less than 30% of the Directors (rounded up to the nearest whole number) shall be Xxxxxx Directors, (c) at any time that the Xxxxxx Investors hold at least 10% (but less than 20%) of the outstanding shares of Common Stock, the Majority Xxxxxx Investors shall have the right to nominate a number of individuals for election to the Board such that not less than 20% of the Directors (rounded up to the nearest whole number) shall be Xxxxxx Directors, and each Nominee shall otherwise be nominated and remain a member (d) at any time that the Xxxxxx Investors hold at least 2% (but less than 10%) of the outstanding shares of Common Stock, the Majority Xxxxxx Investors shall have the right to nominate a number of individuals for election to the Board in accordance with such that not less than 10% of the Corporation’s articles and other policies determined from time Directors (rounded up to time the nearest whole number) shall be Xxxxxx Directors. If an individual designated by the Majority Xxxxxx Investors for nomination for election to the Board for nominating directors. iv. Any Nominee must be qualified to act as a director of the Corporation pursuant to this Section 1G is not nominated or elected to the applicable requirements under applicable lawBoard because of such individual’s death, including applicable Canadian securities laws, the rules of any securities exchange on which the Shares are then listed, and in compliance with withdrawal or disqualification or for any other applicable law and reason is unavailable or unable to serve on the Corporation’s articles. v. In the event that the applicable Parties do not nominate a Nominee at a particular meeting as provided in this Section 1.1Board, then the Corporation Majority Xxxxxx Investors shall proceed with have the right to designate another representative to be nominated for election to the Board and the applicable Corporation shareholder meeting Board seat shall not be filled pending such designation. If any vacancy results from the death, resignation, disqualification, removal or any other cause of a Xxxxxx Director, then the Majority Xxxxxx Investors shall have the right to cause the Board to fill such vacancy with an individual nominated by the Majority Xxxxxx Investors. (ii) From and all further rights after the consummation of such Parties to nominate such Nominee a Qualified Public Offering: (a) the Company shall include each individual designated by the Majority Xxxxxx Investors for nomination for election to the Board pursuant to this Section 1G in the Board’s slate of nominees to the stockholders for each election of directors and in the proxy statement prepared by management of the Company in connection with soliciting proxies for every meeting of the stockholders of the Company called with respect to the election of members of the Board, and at such meeting shall terminate without any further every adjournment or postponement thereof, and on every action or approval by written consent of the Board, and every action of the Partiesstockholders of the Company, with respect to the election of members of the Board; and (b) the Company shall not take any action, including making or recommending any amendment to the Certificate of Incorporation or the Company’s bylaws, that could reasonably be expected to have an adverse effect on the rights of the Majority Xxxxxx Investors under this Section 1G, in each case without the prior written consent of the Majority Xxxxxx Investors. vi. In (iii) For the event that the Parties entitled to nominate a Nominee desire to remove such Nominee from the Board, all avoidance of the other Parties shall, upon written notice from the Parties desiring such removal, take all Necessary Action to cause such Nominee to be removed. At such time as the Sponsor is no longer entitled to nominate a Nominee pursuant to Section 1.1.i.a, the Sponsor and the Corporation shall if requested by a majority of the remaining Nominees take all Necessary Action to cause the Sponsor’s Director Nominee to tender his or her resignation. vii. Any Nominee shall be subject to the Corporation’s customary due diligence process, including its review of a customary questionnaire and background check. Based on the foregoing, the Corporation may reasonably object to any such Nominee within fifteen (15) days of receiving such completed questionnaire and background check authorizationdoubt, (a) provided it does so in good faith the Majority Xxxxxx Investors shall not be deemed to have exercised any of their rights to nominate representatives to the Board pursuant to this Section 1G unless the Majority Xxxxxx Investors shall have sent a written notice to the Company that (1) references this Section 1G, (2) specifies the name of each individual to be nominated to the Board as a Xxxxxx Director and (3) demands that the Company comply with its obligations to nominate individuals to the Board as directed by the Majority Xxxxxx Investors pursuant to this Section 1G, (b) solely the Majority Xxxxxx Investors may determine in their sole discretion whether, and to what extent, to exercise their rights pursuant to Section 1A(iii) and/or Section 1G, (c) as of the extent such objection is based upon date of this Agreement, the Majority Xxxxxx Investors have not exercised any of the following: (i) such Nominee was convicted in a criminal proceeding their rights to designate or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (ii) such Nominee was the subject of nominate any order, judgment or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such Nominee from, or otherwise limiting his or her ability to, engage in (x) any type of business practice or (y) any activity in connection with the purchase or sale of any security or in connection with any violation of applicable securities laws; (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal, state or provincial authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in clause (ii)(y), or to be associated with persons engaged in such activity; (iv) such Nominee was found by a court of competent jurisdiction in a civil action or by applicable securities authorities to have violated any federal, state or provincial securities law, and the judgment in such civil action or finding by such authorities has not been subsequently reversed, suspended or vacated; or (v) such Nominee was the subject of, or a party to, any federal, state or provincial judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal, state or provincial securities laws or regulations. In the event the Board reasonably finds any such Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to such Nominee, the Party(ies) that nominated such Nominee shall be entitled to propose a different Nominee individuals to the Board within fifteen pursuant to Section 1A(iii) or this Section 1G, and (15d) days references in this Agreement to a specified percentage of Directors refer to a percentage of the Corporation’s notice to such Party(ies) number of its objection to such Nominee, then authorized members of the Board (and such replacement Nominee shall be subject not to the review process outlined in this Section 1.1.viinumber of director candidates standing for election at any given meeting).

Board Nomination Rights. i. Notwithstanding anything to (a) At the contrary contained in any definitive agreement or other transaction document pertaining to Effective Time, the Qualifying Transaction and subject to the rules board of any securities exchange on which the subordinate, restricted and limited voting shares in the capital directors of the Corporation Company (and any other share into which they convert or are otherwise exchanged, the “SharesBoard”) may trade on or after shall be comprised of eight members and Xxxxx X. Xxxxxxxx and Xxxxxx X. Xxxxxx shall be designated as Class I directors; Xxxx X. Xxxxxxxx, Xxxxx X. Xxxxxxx and Xxxxxx X. Xxxxxxx shall be designated as Class II directors and Xxxx X. Xxxxxxx, Xxxxxxx X. Xxxx and Xxxxx X. Xxxxxxxx shall be designated as Class III directors. Xxxxx X. Xxxxxxxx, Xxxxxx X. Xxxxxx, Xxxx X. Xxxxxxxx, Xxxxx X. Xxxxxxx, Xxxx X. Xxxxxxx, Xxxxxxx X. Xxxx and Xxxxx X. Xxxxxxxx shall be initial “Nominees” for purposes of this Agreement. (b) From the closing of the Qualifying Transaction, from and after the Closing Effective Time until the date that is three (3) years after the closing date Shareholder ceases to Beneficially Own shares of Common Stock representing at least 5% of the Qualifying Transaction the SponsorCommon Stock then outstanding, the Corporation and the Sellers shall take all reasonable actions (to the extent such actions are not prohibited by applicable law and within such Party’s control, and in the case of any action that requires a vote or other action on the part at every meeting of the Board, or a committee thereof, or action by written consent, at or by which directors of the Company are appointed by the Board or are nominated to stand for election by stockholders of the Company, the Shareholder shall have the right to appoint or nominate for election to the extent Board, as applicable, a number of individuals (such action persons, the “Nominees”) that, if elected, when compared to the authorized number of directors on the Board, is consistent with fiduciary duties closest to but not less than proportional to the total number of shares of Common Stock over which the Shareholder retains direct or indirect voting control relative to the total number of shares of Common Stock then outstanding (which, for the avoidance of doubt, shall mean that the Corporation directors number of Nominees shall be rounded up to the next whole number); provided that the number of such Nominees may have in such capacity) which are necessary (“Necessary Action”) to cause not constitute a majority of the members of the Board to be comprised unless the Shareholder Beneficially Owns shares of eight (8) directors and for those individuals to be nominated in accordance with this Section 1.1 as follows: a. The Sponsor shall, until the earlier to occur of (x) the date that is three (3) years after the closing date of the Qualifying Transaction and (y) the date upon which the Sponsor ceases to own Common Stock representing at least 50% of the Shares owned by it at closing of the Qualifying Transaction (assuming forfeited shares continue to be owned), be entitled to nominate one (1) individual (the “Sponsor’s Director Nominee”), who shall initially be Jxxxx XxxxxxxCommon Stock then outstanding. b. Two (2) independent directors (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) shall be nominated upon the unanimous consent of Kxxx Xxxxx, Gxxxxx Xxxxxx, and the Sponsor (the “Independent Director Nominees”), which directors shall initially be Hxxxxx De La Txxxx and Gxxxxx Xxxxxxxx. c. The Sellers shall be entitled to nominate four (4) individuals (the “Seller Director Nominees”), which directors shall initially be Kxxx Xxxxx, Gxxxxx Xxxxxx and two additional nominees who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110), which additional nominees shall be Jxxxxxx Xxxxxxxxx and Humble Lukanga. d. Element 7 CA, LLC (“Element 7”) shall be entitled to nominate one (1) individual who shall be independent (for audit committee purposes within the meaning of the Canadian Securities Administrators’ National Instrument 52-110) (the “E7 Director Nominee”, and together with the Sponsor’s Director Nominee, the Independent Director Nominees, and the Seller Director Nominees, the “Nominees”), who shall initially be Bxx Xxxxx. ii. The Parties shall be entitled to nominate their respective nominees as set forth in Section 1.1.i for election to the board of directors (the “Board”) at the applicable Corporation shareholders meeting by written notice to the Corporation given (i) in the case of an annual meeting of the shareholders of the Corporation, no less than 60 days prior to the one-year anniversary of the preceding year’s annual meeting date (provided, however, that, if no annual meeting of the Corporation’s shareholders was held in the preceding year, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of such meeting was first made by the Corporation); provided, further, that if the date of the annual meeting of the shareholders of the Corporation is more than thirty (30) days before or more than sixty (60) days after such anniversary date, not later than the 60th day prior to such annual meeting or, if later, the tenth (10) day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation), and (ii) in the case of a special meeting of the shareholders of the Corporation, not less than the later of 60 days prior to such special meeting or the tenth (10) day following the day on which public disclosure of the date of such special meeting was first made by the Corporation, which such notice shall include all information relating to the applicable Nominee(s) that is required to be disclosed in a proxy circular or other filings required to be made in connection with solicitations of proxies for election of directors by a dissident in a contested election pursuant to Part 9 of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”), any other applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (including such applicable Nominee’s written consent to being named in the proxy circular as a nominee and to serving as a director if elected). If the applicable Parties shall elect to nominate a Nominee as provided in this Section 1.1, the Corporation shall, unless such Nominee fails to qualify to act as a director of the Corporation pursuant to the requirements of applicable law, including applicable Canadian securities laws and the rules and regulations of the securities exchange on which the Shares are then listed (i) include such Nominee as a nominee for election as a director of the Board at the applicable Corporation shareholders meeting in the Corporation’s proxy solicitation materials (including any form of proxy the Corporation distributes); and (ii) recommend to the Corporation’s shareholders that they vote in favor of such Nominee at such Corporation shareholders meeting. iii. For the avoidance of doubt, no Party shall be subject to any requirement that shareholders provide advance notice of, or comply with any other procedures governing, the nomination of individuals for election to the Board as provided in the Corporation’s articles, and each Nominee shall otherwise be nominated and remain a member of the Board in accordance with the Corporation’s articles and other policies determined from time to time by the Board for nominating directors. iv. Any Nominee must be qualified to act as a director of the Corporation pursuant to the applicable requirements under applicable law, including applicable Canadian securities laws, the rules of any securities exchange on which the Shares are then listed, and in compliance with any other applicable law and the Corporation’s articles. v. In the event that the applicable Parties do not nominate a Nominee at a particular meeting as provided in this Section 1.1, then the Corporation shall proceed with the applicable Corporation shareholder meeting and all further rights of such Parties to nominate such Nominee for election at such meeting shall terminate without any further action of the Parties. vi. In the event that the Parties entitled to nominate a Nominee desire to remove such Nominee from the Board, all of the other Parties shall, upon written notice from the Parties desiring such removal, take all Necessary Action to cause such Nominee to be removed. At such time as the Sponsor is no longer entitled to nominate a Nominee pursuant to Section 1.1.i.a, the Sponsor and the Corporation shall if requested by a majority of the remaining Nominees take all Necessary Action to cause the Sponsor’s Director Nominee to tender his or her resignation. vii. Any Nominee shall be subject to the Corporation’s customary due diligence process, including its review of a customary questionnaire and background check. Based on the foregoing, the Corporation may reasonably object to any such Nominee within fifteen (15) days of receiving such completed questionnaire and background check authorization, (a) provided it does so in good faith and (b) solely to the extent such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses); (ii) such Nominee was the subject of any order, judgment or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such Nominee from, or otherwise limiting his or her ability to, engage in (x) any type of business practice or (y) any activity in connection with the purchase or sale of any security or in connection with any violation of applicable securities laws; (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal, state or provincial authority barring, suspending or otherwise limiting for more than sixty (60) days the right of such person to engage in any activity described in clause (ii)(y), or to be associated with persons engaged in such activity; (iv) such Nominee was found by a court of competent jurisdiction in a civil action or by applicable securities authorities to have violated any federal, state or provincial securities law, and the judgment in such civil action or finding by such authorities has not been subsequently reversed, suspended or vacated; or (v) such Nominee was the subject of, or a party to, any federal, state or provincial judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal, state or provincial securities laws or regulations. In the event the Board reasonably finds any such Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to such Nominee, the Party(ies) that nominated such Nominee shall be entitled to propose a different Nominee to the Board within fifteen (15) days of the Corporation’s notice to such Party(ies) of its objection to such Nominee, and such replacement Nominee shall be subject to the review process outlined in this Section 1.1.vii.