motion record (re: plan sanction and equity claims) (returnable

Court File No. CV-16-11281-00CL

ONTARIO SUPERIOR COURT OF JUSTICE

COMMERCIAL LIST

IN THE MATTER OF THE COMPANIES' CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED

AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. and GUESTLOGIX IRELAND LIMITED

Dated: September 7, 2016

MOTION RECORD (Re: Plan Sanction and Equity Claims)

(Returnable September 12, 2016)

Thornton Grout Finnigan LLP Suite 3200, TD West Tower 100 Wellington Street West

(the "Applicants")

P.O. Box 329, Toronto-Dominion Centre Toronto, ON M5K 1K7

Robert I. Thornton (LSUC# 24266B) Tel: (416) 304-0560 Email: [email protected]

Rebecca L. Kennedy (LSUC# 61146S) Tel: (416) 304-0603 Fax: (416) 304-1313 Email: [email protected]

Mitch Grossen (LSUC# 69993I) Tel: (416) 304- 7978 Fax: (416) 304-1313 Email: [email protected]

Lawyers for the Applicants



COMMERCIAL LIST



(the "Applicants")

INDEX

Tab Document

1 Notice of Motion returnable on September 12, 2016

2 Affidavit of John Gill berry sworn on September 7, 2016

A Plan of Compromise and Arrangement dated July 29, 2016

B Proof of Claim (Celine Tacnieri dated May 24, 2016)

C Proof of Claim (Alex M. Bodnarchuk dated May 24, 2016)

D Proof of Claim (Harrington Global Opportunities Fund dated May 24, 2016)

E Proof of Claim (Web Objective Inc., dated May 24, 2016)

F Notice of Revision or Disallowance (Celine Tacnieri dated June 16, 2016)

G Notice of Revision or Disallowance (Alex M. Bodnarchuk dated June 16, 2016)

H Notice of Revision or Disallowance (Harrington Global Opportunities Fund dated June 16, 2016)

I Notice of Revision or Disallowance (Web Objective Inc., dated June 16, 2016)

J Notice of Dispute (Celine Tacniere dated June 27, 2016)

K Notice of Dispute (Alex M. Bodnarchuk dated June 27, 2016)

L Notice of Dispute (Harrington Global Opportunities Fund dated May 27, 2016)

M Notice of Dispute (Web Objective Inc. dated June 27, 2016)

N Proof of Claim (Patrick S. Leung dated May 25, 2016)

0 Notice of Revision or Disallowance (Patrick S. Leung dated June 16, 2016)

p Notice of Dispute (Patrick S. Leung dated June 30, 2016)

3 Plan Sanction Order dated September 7, 2016

4 Equity Claims Order dated September 7, 2016

2

Court File No.: CV-16-11281-00CL


(COMMERCIAL LIST)


AND IN THE MATTER OF A PROPOSED PLAN OF COMPROMISE OR ARRANGEMENT OF

GUESTLOGIX INC. and GUESTLOGIX IRELAND LIMITED

NOTICE OF MOTION (Re: Sanction Order and Equity Claims) (Motion returnable September 12, 2016)

(the "Applicants")

THE APPLICANTS will make a motion before a Judge of the Ontario Superior Court of

Justice (Commercial List) on Monday, September 12, 2016 at 8:30 a.m., or as soon after that

time as the motion can be heard, at 330 University Avenue, in the City of Toronto.

PROPOSED METHOD OF HEARING: The motion is to be heard orally.

THIS MOTION IS FOR:

1. the granting of an Order substantially in the form of the draft order included in the

Applicants' Motion Record (the "Plan Sanction Order"), inter alia,

(a) abridging the time of service of the Notice of Motion, the Motion Record herein

and the Ninth Report of the Monitor and dispensing with further service thereof;

and

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(b) sanctioning the Plan of Compromise and Arrangement in respect of GuestLogix

Inc. ("GuestLogix") dated July 29, 2016 (and as it may be further amended,

varied or supplemented from time to time in accordance with the terms thereof,

the "Plan");

2. the granting of an Order substantially in the form of the draft order included in the in the

Applicants' Motion Record (the "Equity Claims Order"), inter alia,

(a) declaring that the Class Action Claims (as defined in the Gillberry Affidavit) and

the indemnity claim filed by Patrick Leung are equity claims pursuant to the

CCAA; and

3. such further and other relief as counsel may request and this Court deems just.

THE GROUNDS FOR THE MOTION ARE:

4. All capitalized terms used herein and not defined, shall have the meanings ascribed to

them in the Gillberry Affidavit.

Background

5. The Applicants commenced proceedings under the Companies' Creditors Arrangement

Act, R.S.C. 1985, c. C-36, as amended (the "CCAA"), and obtained the Initial Order in

these proceedings on February 9, 2016 (the "Initial Order"). The Initial Order was

amended and restated on February 12, 2016;

6. On February 19, 2016, the Applicants obtained approval of the SISP that solicited interest

in and opportunities for a sale of or investment in all or part of the Applicants' assets and

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business operations. The Applicants, with the assistance of the Monitor and the Financial

Advisor, have completed the SISP in accordance with its terms;

7. On April 13, 2016, the Court approved the sale of all of the shares of OpenJaw

Technologies Limited and OpenJaw Technologies Iberica S.L. (the "OpenJaw Sale").

Pursuant to the Distribution Order granted on April 29, 2016, the proceeds of the

OpenJaw Sale were used to repay all amounts drawn under the Commitment Letter (as

defined in the Initial Order) as well as the secured pre-filing obligations of the

Applicants;

8. On April 29, 2016, the Court granted an Order (the "Claims Procedure Order") that

called for claims against the Applicants and their directors and officers;

9. On July 13, 2016, the Court granted an Order (the "Approval Order") that approved of a

Transaction Agreement dated June 30, 2016 (the "Transaction Agreement") among

GuestLogix and GXI Acquisition Corp. (the "Sponsor") that set out the proposed

restructuring transaction (the "Transaction") for GuestLogix;

10. On August 3, 2016, the Court granted an Order (the "Meeting Order") that accepted the

Plan for filing with the Court and authorized GuestLogix to hold a meeting of its

unsecured creditors on September 2, 2016 (the "Meeting");

The Sanction Order

11. GuestLogix has complied in all respects with the notice and service requirements

contained in the Claims Procedure Order and the Meeting Order;

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12. The Plan is the culmination of the efforts of GuestLogix, the Sponsor and their advisor to

restructure GuestLogix as a going concern. The Plan is in the best interests of all of the

stakeholders of GuestLogix. The Plan is supported by the Monitor;

13. At the Meeting, the Plan was approved by 100% in number and 100% in value of the

Affected Unsecured Creditors that were entitled to vote at the Meeting. While there were

two Unresolved Claims that voted against the Plan at the Meeting, their votes would not

affect the outcome of the resolution approving the Plan;

14. GuestLogix has acted in good faith and with due diligence and believes that the terms of

the Plan are fair and reasonable. As outlined in the Eighth Report, the Monitor concluded

that the Plan was fair and reasonable;

The Equity Claims Order

15. The nature of the four Proofs of Claim from the individual claimants (the "Class Action

Claimants") relating to the class action proceedings commenced by Celine Tacniere (the

"Class Action Claims") are a result of persons acquiring and holding GuestLogix equity

securities and are equity claims under the CCAA;

16. All claims filed against Patrick Leung pursuant to the Claims Procedure Order were in

respect of an equity interest, and therefore, the indemnity claim constitutes an equity

claim under the CCAA;

17. The provisions of the CCAA, with particular reference to sections 2 and 6 thereof, as well

as the inherent and equitable jurisdiction of the Court;

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18. Rules 1.04, 2.03, 3.02, 16.08 and 37 of the Rules a/Civil Procedure, R.R.O. 1990, Reg.

194, as amended; and

19. Such further and other grounds as counsel may advise and the Court may permit.

THE FOLLOWING DOCUMENTARY EVIDENCE will be used at the hearing of the

motion:

(a) the Affidavit of John Gillberry sworn September 7, 2016, and the Exhibits thereto

(the "Gillberry Affidavit");

(b) the Eighth Report of the Monitor dated August 2, 2016;

( c) the Ninth Report of the Monitor, to be filed; and

( d) such further and other material as counsel may advise and this Honourable Court

may permit.

September 7, 2016 THORNTON GROUT FINNIGAN LLP TD West Tower Suite 3200, 100 Wellington Street West Toronto-Dominion Centre Toronto, ON MSK 1 K7


Rebecca L. Kennedy (LSUC# 61146S) Tel: (416) 304-0603 Email: [email protected]

Mitch Grossen (LSUC# 69993!) Tel: (416) 304-7978 Fax: (416) 304-1313 Email: [email protected]


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TO: THIS HONOURABLE COURT

AND TO: THE ATTACHED SERVICE LIST

TO:

EMAIL SERVICE LIST (AS AT SEPTEMBER 12, 2016)

THORNTON GROUT FINNIGAN LLP Barristers & Solicitors Suite 3200, TD West Tower 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre Toronto, ON M5K 1K7 Fax: ( 416) 304-1313

Robert I. Thornton Tel: ( 416) 304-0560 Email: [email protected]

Rebecca L. Kennedy Tel: (416) 304-0603 Email: [email protected]

Mitch Grossen Tel: (416) 304-7978 Email: [email protected]


AND TO: PRICEWATERHOUSECOOPERS INC. PricewaterhouseCoopers LLP PwC Tower 18 York St., Suite 2600 Toronto, ON M5J OB2 Fax: (416) 814-3210

Gregory Prince Tel: (416) 814-5752 Email: [email protected]

Rose Thuringer Tel: (416) 941-8383 Email: [email protected]

Tracey Weaver Tel: (416) 814-5735 Email: [email protected]

Monitor

AND TO:

AND TO:

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NORTON ROSE FULBRIGHT LLP 200 Bay Street, P.O. Box 84 Toronto, ON M5J 2Z4 Fax: (416) 216-3930

Orestes Pasparakis Tel: (416) 216-4815 Email: [email protected]

Evan Cobb Tel: (416) 216-1929 Email [email protected]

Virginie Gauthier Tel: (416) 216-4853 Email: [email protected]

Lawyers for the Monitor

OSLER, HOSKIN & HARCOURT LLP 100 King Street West 1 First Canadian Place Suite 6200, P.O. Box 50 Toronto ON M5X IB8 Fax: (416) 862-6666

Sonja Pavic Tel: (416) 862-5661 Email: [email protected]

Martin Desrosiers Tel: (514) 904-5649 Email: [email protected]

Lawyers for the Directors of Guestlogix Inc.

AND TO: MORGANTI LEGAL One Yonge Street Suite 1506 Toronto, ON M5J 1E5

Andrew J. Morganti Tel: (416) 970-0852

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Email: [email protected]

Benjamin D. Tinholt Tel: (647) 286-4826 Email: [email protected]

Lawyers for Celine Tacniere and the Proposed Class

AND TO: TMX EQUITY TRANSFER SERVICES 200 University A venue Suite 300 Toronto, ON M5H 4Hl Fax: (416) 361-0470

Don Crawford, Corporate Trust Officer Tel: (416) 607-7878 Email: [email protected]

Trustee for the Unsecured Convertible Debentureholders

AND TO: FASKEN MARTINEAU DUMOULIN LLP 333 Bay Street Suite 2400 Toronto, ON M5H 2T6 Fax: (416) 364 7813

Krisztian Toth Tel: (416) 865 5467 Email: [email protected]

Lawyers for Mark Rivers of Oasis Global

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AND TO: LK SHIELDS SOLICITORS 39-40 Upper Mount Street Dublin 2 Ireland Fax: +353 1 661 0883

Emmet Scully Tel: +353 1 637 1538 Email: [email protected]

Gillian Dully Tel: +353 1 638 5863 Email: [email protected]

Lawyers who acted for the shareholders of OpenJaw Technologies Limited in the sale of OpenJaw Technologies Limited to Guestlogix Ireland Limited

AND TO: ALEXANDER HOLBURN BEAUDIN+ LANG LLP Barristers and Solicitors 700 West Georgia Street Suite 2700 Vancouver, B.C. V7Y 1B8 Fax: (604) 484-1900

Sharon Urquhart Tel: (604) 484-1700 Email: [email protected]

Lawyers for Alaska Airlines, Inc.

AND TO: TORYS LLP 79 Wellington Street West 30th Floor, Box 270 Toronto, ON M5K 1N2

David Bish Tel: (416) 865-7353 Email: [email protected]

James C. Tory Tel: (416) 865-7391 Email: [email protected]

Gillian B. Dingle Tel: (416) 865-8229 Email: [email protected]

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Lawyers for the Defendant, National Bank Financial, Inc.

AND TO: KOPELOWITZ OSTROW P.A. 2525 Ponce de Leon Boulevard Suite 625 Coral Gables, FL 33134

Francisco J. Gonzalez Tel: (305) 405-8077 Email: [email protected]

Lawyers for Thinkink Communications, LLC

AND TO: CANACCORD GENUITY CORP. 161 Bay Street, Suite 2900 Toronto, ON M5J 2S 1

Colin Shepard Tel: (416) 687-5285 Email: [email protected]

Financial advisor of GuestLogix Inc.

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AND TO: STOCKWOODS LLP Toronto-Dominion Centre TD North Tower, Box 140 77 King Street West, Suite 4130 Toronto, ON M5K IHI Fax: 416-593-9345

Andrea Gonsalves Tel: (416) 593-3497 Email: [email protected]

Carlo Di Carlo Tel: ( 416) 593-2485 Email: [email protected]

Lawyers for Brett Proud

AND TO: DELL FINANCIAL SERVICES CANADA Fax: (512) 283-1978

Luiza May Cortezano Tel: (877) 577-3355 ext 4252243 Email: Luiza _May_ [email protected]

AND TO: HEWLETT PACKARD FINANCIAL SERVICES Fax (484)242-3180

AND TO:

Lorenna Marte Tel: 1-800-361-1006 Ext. 7822159 Email [email protected]

GREENROCK CAPITAL PARTNERS 78 Scollard Street Toronto, ON M5Rl G2

Chris Seed, CIO & Portfolio Manager Tel: (416) 944-2700 Email: [email protected]

Massimo Voci Email: [email protected]

Representative of the Unsecured Convertible Debentureholders

AND TO:

AND TO:

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BROADVIEW CAPITAL MANAGEMENT, INC. 181 Carlaw Ave., Suite 302 Toronto, ON M4M 2Sl

Anthony Hammill, Managing Director Tel: (416) 406-4808 Email: [email protected]

Lee Matheson, Managing Director Tel: (416) 406-4800 Email: [email protected]

Representatives of the Unsecured Convertible Debentureholders

AIRD & BERLIS LLP Barristers & Solicitors 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 Fax: (416) 863-1515

Steven L. Graff Tel: ( 416) 865-7726 Email: [email protected]

Ian Aversa Tel: ( 416) 865-3082 Email: [email protected]

Jeremy Nemers Tel: (416) 865-7724 Email: [email protected]

Lawyers for the Ad Hoc Committee of holders of debentures issued pursuant to the Trust Indenture dated December 22, 2014 between GuestLogix Inc. and Equity Financial Trust Company

AND TO:

AND TO:

AND TO:

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KUGLER KANDESTIN LLP 1 Place Ville-Marie Suite 2101 Montreal, PQ H3B 2C6 Fax: (514) 875-8424

Gordon Levine Tel: (514) 878-2861 Email: [email protected]

Canadian counsel for Koninklijke Luchtvaart Maatschappij N.V. (also known as KLM Royal Dutch Airlines)

BAKER & MCKENZIE LLP 181 Bay Street, P.O. Box 874 Suite 2100 Toronto, ON M5J 2T3 Fax: (416) 863-6275

Frank Spizzirri Tel: (416) 865-6940 Email: [email protected]

Charlie MacCready Tel: ( 416) 865-6876 Email: [email protected]

Canadian counsel for TravelSky Technology Singapore Ptd. Ltd.

BENNETT JONES LLP 3400 One First Canadian Place P.O. Box 130 Toronto, ON M5X 1A4

Raj S. Sahni Tel: (416) 777-4804 Email: [email protected]

Danish Afroz Tel: (416) 777-6124 Email: [email protected]

Lawyers for Honeywell International Inc., the corporate parent of Hand Held Products Inc. (dba Honeywell Scanning & Mobility)

- 9 -

AND TO: CANADA REVENUE AGENCY The Exchange Tower Suite 3400, 130 King St. W. Toronto, ON M5X 1K6

Diane Winters Tel: ( 416) 973-3172 Email: [email protected]

Ed Parks Tel: (416) 973-3746 Email: [email protected]

AND TO: GOODMANS LLP 3 3 3 Bay Street Suite 3400 Toronto, ON M5H 2S7

Robert J. Chadwick Tel: (416) 597-4285 Email: [email protected]

Bradley Wiffen Tel: (416) 597-4208 Email: [email protected]

Lawyers for the Proposed Purchaser of the OnBoard Business

AND TO: MASON HAYES & CURRAN South Bank House, Barrow Street, Grand Canal Dock, Dublin 4, Ireland D04 TR29 Fax: (353) 614-5001

Martin Kelleher Tel: (353) 614-5206 Email: [email protected]

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AND TO: RUSSELL BRENNON KEANE RBK House, Irishtown, Athlone Co. Westmeath, Ireland N37 XP 52 Fax: (353) 90 647 8083

Tel: (353) 90 648 0600 Email: [email protected]

AND TO: ARGO PARTNERS 12 W. 37TH ST. 9th Floor New York, NY 10018 Fax: (212)-643-6401

Catherine Dine Tel: (212)-643-5442 Email: [email protected];

AND TO: CHUBB INSURANCE COMPANY OF CANADA 1250 Rene-Levesque Blvd. W Suite 2700 Montreal, QC H3B 4W8 Fax: (514) 938-2288

Catherine Rayle-Doiron Tel: (514) 938-2300 (ext. 5325) Email: [email protected]

AND TO: CANACCORD GENUITY CORP. 2200 - 609 Granville Street P.O. Box 10337 Vancouver, BC V7Y 1H2 Fax: (604) 643-7442

Alex Travasso Tel: (604) 643-7402 Email: alex _ [email protected]

ANDTO: CIBC 320 Bay Street, P.O. Box 1 Toronto, ON M5H 4A6 Fax: (416) 643-5993

Yvonne Williams Tel: (416) 643-5198 Email: yvonne _ [email protected]

- 11 -

AND TO: RBC DOMINION SECURITIES INC. Royal Bank Plaza, North Tower 61h Floor, P.O. Box 50 Toronto, ON M5J 2W7 Fax: (416) 842-8295

Karen Oliveros Tel: (416) 842-8282 Email: [email protected]

AND TO: TD WATERHOUSE CANADA INC. 77 Bloor Street West 3rd Floor Toronto, ON M4Y 2Tl Fax: (416) 542-0869

Yousuf Ahmed Tel: (416) 542-0406 Email: [email protected]

AND TO: GMP SECURITIES L.P. 145 King Street West, Suite 1100 Toronto, ON M5H 1J8 Fax: (416) 943-6176

Terry Young Tel: (416) 943-6158 Email: [email protected]

AND TO: GOLDMAN SACHS CANADA INC. 150 King Street West, Suite 1201 Toronto, ON M5H 1J9 Fax: ( 416) 343-8750

Bernie Gratton Tel: ( 416) 343-8784 Email: [email protected]

AND TO: NBCN INC. 1010 De La Gauchetiere West, Place du Canada, Suite 1925, R Montreal, QC H3B 5J2 Fax: (514) 875-3264

Tracy Matticks Tel: (514) 868-6589 Email: [email protected]

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AND TO: BMO NESBITT BURNS INC. 1 First Canadian Place, 35th Floor P.O. Box 150 Toronto, ON M5X 1H3 Fax: ( 416) 359-6755

Louise Torrangeau Tel: (416) 359-6741 Email: [email protected]

AND TO: PI FINANCIAL CORP. 666 Burrard Street Suite 1900 Vancouver, BC V6C 3Nl Fax: (604) 664-2613

Laura Bliss Tel: (604) 664-2764 Email: [email protected]

AND TO: MACKIE RESEARCH CAPITAL CORP. 222 Bay Street, T.D. Centre P.O. Box 265, Suite 1500 Toronto, ON M5K US Fax: (416) 860-6775

Tony Rodrigues Tel: (416) 860-8683 Email: [email protected]

AND TO: LEEDE JONES GABLE INC. Suite 2300, First Alberta Place 777 - 8th A venue South West Calgary, AB T2P 3R5 Fax: (403) 261-4810

Dave MacDonald Tel: (403) 531-6838 Email: [email protected]

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AND TO: RBC DEXIA INVESTOR SERVICE 15 5 Wellington Street West Street Level Toronto, ON M5V 3L3

Emma Sattar Tel: (416) 955-3993 Fax: (416) 955-3031 Email: [email protected]

AND TO: SCOTIA CAPITAL INC. 40 King Street West Station A, P.O. Box 4085 Toronto, ON MSW 2X6

Normita Ramirez Tel: (416) 863-7842 Fax: (416) 862-5807 Email: [email protected]

AND TO: CORMARK SECURITIES INC. Royal Bank Plaza, South Tower Suite 3450 Toronto, ON M5J 2J2

Lisa Frank Tel: (416) 943-6444 Fax: (416) 943-6495 Email: [email protected]

AND TO: V ALEURS MOBILIERES DESJARDINS 2, Complexe Desjardins, Tour est, Basilaire 1 C.P. 394 Succ Montreal, QC H5B 1 J2

Karla Diaz Tel: (514) 281-2244 Fax: (514)842-7931 Email: [email protected]

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AND TO: CIBC WORLD MARKETS INC. 161 Bay Street, BCE Place 10th Floor, P.O. Box 500 Toronto, ON M5J 2S8

Solomon Tewolde Tel: (416) 542-4159 Fax: (416) 542-4628 Email: [email protected]

AND TO: SPARK LLP 169 King Street East 3rd Floor Toronto ON M5A IJ4

Jeff Rosekat Tel: (416) 639-2151 Email: [email protected]

Insolvency counsel to the Class Action Claimants AND TO: PALIARE ROLAND

155 Wellington Street West 35th Floor Toronto ON M5V 3Hl

Massimo (Max) Starnino Tel: ( 416) 646-7431 Fax: (416) 646-4301 Email: [email protected]

Counsel for Patrick Leung

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Email Service List

[email protected]; [email protected]; [email protected]; gregory .n. [email protected]; rose. [email protected]; tracey. [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; Luiza_ May_ [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; alex _ [email protected]; yvonne _ [email protected]; : [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]


AND IN THE MATTER OF A PROPOSED PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. and GUESTLOGIX IRELAND LIMITED



(COMMERCIAL LIST) Proceedings commenced at Toronto

NOTICE OF MOTION (Re: Sanction Order and Equity Claims) (Motion returnable September 12, 2016)

Thornton Grout Finnigan LLP TD West Tower Suite 3200, 100 Wellington Street West Toronto-Dominion Centre Toronto, ON M5K 1K7



Mitch Grossell (LSUC# 69993I) Tel: (416) 304-7978 Fax: (416) 304-1313 Email: [email protected]




(COMMERCIAL LIST)



(the "Applicants")

AFFIDAVIT OF JOHN GILLBERRY

(Sworn on September 7, 2016)

I, John Gillberry, of the City of Milton, in the Province of Ontario, MAKE OATH AND SAY:

1. I am the Interim Chief Executive Officer of GuestLogix Inc. ("GuestLogix" or the

"Company"). Through my involvement with the Company, I have knowledge of the

matters to which I hereinafter depose. Where I do not possess personal knowledge, I

have stated the source of my information and, in all such cases, believe such information

to be true.

2. I swear this Affidavit in support of a motion brought by the Applicants for orders, inter

alia:

(a) sanctioning GuestLogix's Plan of Compromise and Arrangement dated July 29,

2016 (as amended and restated to September 2, 2016 and as may be further

amended, restated, modified or supplemented, the "Plan") pursuant to the

- 2 -

Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended (the

"CCAA") (the "Plan Sanction Order"); and

(b) declaring that the Class Action Claims (as defined herein) and the indemnity

claim of Patrick Leung are equity claims, as defined in the CCAA.

3. In preparing this Affidavit, I have reviewed the Eighth Report (the "Eighth Report") of

PricewaterhouseCoopers Inc. (the "Monitor") filed in these proceedings and I am

advised that a Ninth Report of the Monitor (the "Ninth Report") will be filed in support

of this motion.

4. Capitalized terms not otherwise defined in this Affidavit have the meanings given to

them in the Plan. A copy of the Plan is attached hereto as Exhibit "A".

5. The Plan to be implemented and the restructuring are the result of significant efforts by

GuestLogix. If implemented, the Plan will maintain GuestLogix as a unified, going

concern enterprise for the benefit of customers, suppliers and employees and provide a

significant recovery to the Company's unsecured creditors. GuestLogix believes that the

Plan represents the best available outcome for the Company and its stakeholders and that

it is superior to all available alternatives.

6. At a meeting of the Applicants' unsecured creditors held on September 2, 2016 to

consider and vote on the Plan, the Plan was approved by 100 percent in number and 100

percent in dollar value of the Affected Unsecured Creditors with Proven Voting Claims

voting in person or by proxy. As described below, two Unresolved Claims voted against

the Plan, but the inclusion of those votes would not have affected the approval of the Plan

by the requisite majority at the meeting.

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7. The Plan and the relief sought under the Plan Sanction Order are supported by the

Monitor and the Sponsor (as defined herein). Accordingly, the Company requests that

this Court grant the Plan Sanction Order to enable GuestLogix to take the steps and

actions necessary to implement the Plan and make distributions to its unsecured creditors

in a timely and efficient manner.

Background and the CCAA Proceedings

8. GuestLogix provides retail and payment technology that enables travel brands to enhance

retail strategies at any travel touch point. GuestLogix and its subsidiaries offered two

distinct platforms at the commencement of these proceedings: the OnBoard Retail

Technology Platform and the t-Retail platform. The combination of both platforms

consisted of proprietary point-of-sale hardware and software, a transaction processing

engine, global payment gateway services, a business intelligence platform, hosted

infrastructure, travel-relevant content, syndicated data services, and other significant

proprietary intellectual property.

9. GuestLogix provides the OnBoard Retail Technology Platform (the "Onboard

Business") to its international customers.

10. GL Ireland is a wholly-owned subsidiary of GuestLogix and is the holding company that

held all of the shares of OpenJaw Technologies Limited ("OpenJaw"). OpenJaw and its

subsidiaries provide the t-Retail platform (the "OpenJaw Business") to their

international customers. As described below, the OpenJaw Business was sold through

the SISP (defined herein).

- 4 -

11. On February 9, 2016, GuestLogix was granted an Initial Order ( as amended or restated

from time to time, the "Initial Order") under the CCAA (the "CCAA Proceedings") by

the Ontario Superior Court of Justice (Commercial List) (the "Court"). Pursuant to the

Initial Order, PricewaterhouseCoopers Inc. was appointed as Monitor of the Applicants

(the "Monitor").

12. On February 12, 2016, the Initial Order was amended and restated, inter alia, to add GL

Ireland as an Applicant in the CCAA Proceedings.

13. On February 19, 2016, the Court granted an Order ( the "SISP Order") approving a sale

and investment solicitation process (the "SISP") that governed the Applicants'

solicitation of interest in and/or opportunities for a sale of or investment in all or part of

the Applicants' assets (the "Property") and business operations (the "Business").

14. On April 29, 2016, the Court granted an Order (the "Claims Procedure Order") that

called for claims against the Applicants and their Directors and Officers.

15. Throughout these proceedings, the Applicants and Canaccord Genuity Corp. (the

"Financial Advisor") worked with the Monitor to conduct the SISP in accordance with

the SISP Order.

16. As previously reported, as a result of the SISP:

(a) GL Ireland entered into a Share Purchase Agreement (the "Share Purchase

Agreement") for the sale and purchase of the OpenJaw Business (the "OpenJaw

Sale"), which sale was approved by the Order of the Court dated April 13, 2016.

The Share Purchase Agreement closed on May 6, 2016. Pursuant to the

- 5 -

Distribution Order granted on April 29, 2016, a portion of the proceeds of the

OpenJaw Sale was used to repay all amounts drawn under the interim financing

Commitment Letter as well as the secured pre-filing obligations of the Applicants;

and

(b) GuestLogix entered into a Transaction Agreement with GXI Acquisition Corp.

(the "Sponsor") dated June 30, 2016 (the "Transaction Agreement") setting out

the proposed restructuring transaction (the "Transaction"). The Transaction

Agreement contemplates the implementation of the Transaction through the Plan

but provides that, in the event that the Transaction cannot be completed as

contemplated through the Plan, the Transaction will be implemented through an

asset purchase transaction (the "Sale Transaction") pursuant to an agreement

substantially in the form attached to the Transaction Agreement (the "APA").

17. On July 13, 2016, the Court granted an Order (the "Approval Order") that approved

GuestLogix' s entry into the Transaction Agreement, and authorized and directed

GuestLogix to develop the Plan, seek the Meeting Order (as defined below) in respect of

the Plan, and seek the Plan Sanction Order subject to the Plan being approved by the

requisite majority of GuestLogix's creditors. The Approval order also approved the form

of AP A and the vesting of GuestLogix' s assets in the event that the Transaction was to be

implemented as a Sale Transaction pursuant to the terms of the Transaction Agreement.

18. On August 3, 2016, the Court granted an Order (the "Meeting Order") that, inter alia,

accepted the Plan for filing with the Court and authorized GuestLogix to hold a meeting

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of its unsecured creditors. Such meeting was held on September 2, 2016 as described

below.

The Plan 1

19. The purpose of the Plan is to: (i) implement a recapitalization of the Company; (ii)

provide for a settlement of, and consideration for, all Affected Unsecured Claims; (iii)

effect a release and discharge of all Affected Claims and Released Claims, as against,

among others, the Company and its Directors and Officers; and (iv) ensure the

continuation of the Company, with the expectation that the Persons who have an

economic interest in the Company will derive a greater benefit from the implementation

of the Plan than they would derive from any other alternative in respect of the Company.

20. The Plan provides for a full and final release and discharge of the Affected Claims and

Released Claims, a settlement of, and consideration for, all Affected Unsecured Claims

and a recapitalization of the Company. The Plan does not affect holders of Unaffected

Claims.

21. If approved, sanctioned and implemented, the Plan would result in the Company having

an improved capital structure and stable working capital. In particular, the Plan would:

(a) compromise all the indebtedness of GuestLogix, giving it a clean balance sheet

going forward;

1 All capitalized terms not defined in this section shall have the meaning ascribed to them in the Plan.

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(b) provide a pro rat a distribution of the Unsecured Creditors' Distribution Pool to all

the Affected Unsecured Creditors holding Proven Distribution Claims of

GuestLogix (the "Affected Unsecured Creditor Distribution"); and

( c) compromise all Equity Claims against the Company and its the Directors and

Officers, allowing the Company and its Directors and Officers to have a fresh

start upon emergence from the CCAA Proceedings.

22. Additional salient points from the Plan are:

(a) in accordance with the Meeting Order, there shall be one class of Creditors for the

purpose of considering and voting on this Plan, being the Unsecured Creditors

Class;

(b) Equity Claimants shall not receive any consideration or distributions under this

Plan and shall not be entitled to vote on the Plan at the Meeting;

( c) Unaffected Claims shall not be compromised, released, discharged, cancelled or

barred by the Plan;

( d) Insured Claims shall not be compromised, released, discharged, cancelled or

barred by the Plan, provided that, from and after the Plan Implementation Date,

any Person having an Insured Claim shall be irrevocably limited to recovery in

respect of such Insured Claim solely from the proceeds of the applicable

Insurance Policies, and Persons with any Insured Claims shall have no right to,

and shall not, directly or indirectly, seek any recoveries from the Company, the

Directors and Officers or any other Released Party, other than enforcing such

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Persons' rights to be paid by the applicable insurer(s) from the proceeds of the

applicable Insurance Policies;

(e) all Released Director/Officer Claims shall be fully, finally, irrevocably and

forever compromised, released, discharged, cancelled and barred on the Plan

Implementation Date;

(t) AssetCo shall be incorporated and shall not be an affiliate of the Company. The

Transferred Assets, which the Sponsor has elected not to retain in the Company,

shall be transferred to AssetCo;

(g) as part of the implementation of the Plan:

(i) all Existing Options shall be cancelled and terminated without any

liability, payment or other compensation in respect thereof and the Stock

Option Plans shall be terminated;

(ii) upon receipt by the Monitor of the Closing Cash Payment ( as defined in

the Transaction Agreement), the Company shall issue to the Sponsor the

Agreed Number of New Common Shares;

(iii) the Articles shall be altered to, among other things, (a) consolidate the

issued and outstanding Common Shares (including, for the avoidance of

doubt, Common Shares that are Existing Shares and New Common

Shares) on the basis of the Consolidation Ratio; and (b) provide for such

additional changes to the rights and conditions attached to the Common

Shares as may be agreed to by the Company and the Sponsor;

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(iv) any fractional Common Shares held by any holder of Common Shares

immediately following the consolidation of the Common Shares shall be

cancelled without any liability, payment or other compensation in respect

thereof, and the Articles shall be altered as necessary to achieve such

cancellation;

(v) all Equity Interests (for greater certainty, not including any New Common

Shares that remain issued and outstanding immediately following the

cancellation of fractional interests) shall be cancelled and extinguished

without any liability, payment or other compensation in respect thereof

and all Equity Claims shall be fully, finally, irrevocably and forever

compromised, released, discharged, cancelled and barred without any

liability, payment or other compensation in respect thereof;

(vi) the Debentures, the Indenture and all Debenture Obligations shall be

deemed to be fully, finally, irrevocably and forever compromised,

released, discharged, cancelled and barred;

(vii) all Affected Claims shall be fully, finally, irrevocably and forever

compromised, released, discharged cancelled and barred without any

liability, payment or other compensation in respect thereof, other than (in

the case of Affected Unsecured Claims) the Affected Unsecured Creditor

Distribution;

(viii) any right of indemnity or contribution of a Director, Officer or Employee

against the Company of any nature whatsoever (whether pursuant to a

written contract or agreement or otherwise, and whether present or future

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or known or unknown) shall be fully, finally, irrevocably and forever

terminated, extinguished, compromised, released, discharged, cancelled

and barred without any liability, payment or other compensation in respect

thereof and each Director, Officer or Employee shall be permanently

barred, estopped, stayed and enjoined, on and after the Plan

Implementation Date, from asserting any such right of indemnity or

contribution against the Company;

(ix) all current Directors shall be deemed to have resigned from the board of

directors of the Company, and the Persons named on a certificate to be

filed with the Court by the Company on or prior to the Plan

Implementation Date shall be appointed to the board of directors of the

Company; and

(x) the releases set forth in the Plan shall become effective.

23. The Plan provides for the release of a number of Released Parties including the Directors

and Officers of the Company (the "Releases"). As noted above, the Insured Claims,

including Insured Claims against the Company, the Directors and Officers, are unaffected

and remain in place to the extent that such Insured Claims are insured. Insured Claims

are limited to recovery solely from the proceeds of the applicable Insurance Policies. The

release of the Released Parties was negotiated as part of the Plan and is intended to

facilitate the successful completion of the CCAA Proceedings. A key aspect of the

Transaction for all parties is the release of all Claims against or relating to the Company

(subject to the limited exclusion for Insured Claims) so that the Company can move

forward with a fresh start.

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24. GuestLogix believes that the Releases are all rationally connected to the Plan, given,

among other things, that:

(a) the Directors and Officers have overseen the Applicants' strategic review and

solicitation process and provided guidance and stability throughout the

restructuring process and these proceedings;

(b) the advisors have been retained with the specific role of assisting with the

development and implementation of the Plan, which could not be successfully

achieved without their contribution;

( c) the Sponsor has agreed to provide the necessary capital required for the successful

reorganization of the Company to allow it to continue as a going concern; and

( d) all Released Parties have contributed fully to the development of the Plan and

support both the Transaction and the Plan.

25. The Plan does not release: (a) the Company of or from any of its obligations under the

Plan or any Order of the Court, and (b) any claims that are Unaffected Claims under the

Plan. Unaffected Claim means any: (i) Claim secured by any of the Charges; (ii) Insured

Claim; (iii) Claim in respect of Customer Prepayments; (iv) Post-Filing Claim; (v)

Transition Costs; (vi) Employee Priority Claim; (vii) Government Priority Claim; and

(viii) Claim that is not permitted to be compromised pursuant to section 19(2) or 5.1(2) of

the CCAA.

26. Implementation of the Plan is conditional upon, among other things: (a) the satisfaction

of the conditions precedent set out in the Transaction Agreement; and (b) implementation

of the Plan by the Outside Date, being September 30, 2016.

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The Meeting2

27. Pursuant to the Meeting Order, the Company was authorized to file the Plan and to

convene the meeting of a single class of the Affected Unsecured Creditors to consider

and vote on the Plan (the "Meeting"). The Meeting was held at the offices of

PricewaterhouseCoopers Inc. at PwC Tower, 18 York Street, Suite 2600, Toronto,

Ontario at 10:00 a.m. on September 2, 2016.

28. I am advised that a discussion of the satisfaction of the notice requirements and the

directions in the Meeting Order will be included in the Ninth Report.

29. I am also advised that a comprehensive overview of the results of the Meeting will be

included in the Ninth Report. To summarize, 100 percent in number representing 100

percent in value of the Unaffected Creditor Class that were present in person or by proxy

at the Meeting voted to pass the Plan Resolution (as defined below) approving the Plan.

30. As discussed below, there are certain claims that remain unresolved. Three Claimants

holding Unresolved Claims submitted proxies: one voted in favour of the Plan, while the

other two voted against the Plan. The inclusion of the two unresolved Class Action

Claims (as defined below) that voted against the Plan would have had no effect on the

approval of the Plan Resolution (as defined below).

31. As will be discussed in the Ninth Report, the votes against the Plan of the two Claimants

with Unresolved Claims would not affect the outcome of the vote on the resolution of the

2 All capitalized terms not defined in this section shall have the meanings ascribed to them in the Meeting Order.

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Affected Unsecured Creditors to approve the Plan (the "Plan Resolution"). As such,

regardless of their inclusion, the Plan Resolution would pass.

Request for Sanction of the Plan

32. As previously described to the Court, the Applicants, with the assistance of the Financial

Advisor and the Monitor, conducted the SISP in accordance with the SISP Order. The

Transaction resulted from the SISP, which was a robust and extensive solicitation

process, and the Plan is the culmination of that process. The Plan is in the best interest of

all of the stakeholders of GuestLogix. The Plan is supported by the Monitor. The

Company and the Sponsor intend to work expeditiously to close the Transaction as soon

as possible following the granting of the Plan Sanction Order.

33. Throughout the course of these CCAA Proceedings, the Applicants have acted in good

faith and with due diligence. The Applicants have also complied with the requirements

of the CCAA and the Orders of this Court. Implementation of the Plan will allow

GuestLogix to continue as a going concern post-implementation.

34. As outlined in the Eighth Report, the Monitor concluded that the Plan was fair and

reasonable.

35. Accordingly, I believe that the Plan is fair, equitable and reasonable to all affected parties

and that the approval of the Plan by the Court is justified and appropriate.

Update on the Claims Procedure

36. As outlined above, on April 29, 2016, this Court granted the Claims Procedure Order. A

comprehensive update on the Claims Procedure Order was set out in the Seventh Report

of the Monitor. Since the filing of the Seventh Report of the Monitor, the Company, with

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the assistance of the Monitor, has resolved nearly all of the disputed claims such that only

two subsidiary employee claims remain and the five equity claims described below. The

Company continues to work towards a resolution of the subsidiary employee claims on a

consensual basis.

Equity Claims

37. Under the procedures established in the Claims Procedure Order, the Monitor received

four Proofs of Claim from individual claimants (the "Class Action Claimants") relating

to the class action proceedings commenced by Celine Tacniere on January 25, 2016 (the

"Class Action Claims"). The Proofs of Claim for the Class Action Claims are attached

hereto as Exhibits "B", "C", "D" and "E".

38. As described in the Class Action Claims' Proofs of Claim, the nature of the claims is

securities class action claims. The damages as set out in the Fresh and Amended

Statement of Claim are a result of the Class Action Claimants acquiring and holding

GuestLogix's equity securities and also under the Securities Act (Ontario).

39. Following the review of the Class Action Claims, the Monitor provided the notice of

revision and disallowance of all of the Class Action Claims on June 16, 2016. The Class

Action Claims were disallowed for the following reasons: (a) each Class Action Claim

represented an equity claim as defined in subsection 2( 1) of the CCAA; (b) the funds

available for distribution are not enough to pay all Claims that are not equity claims in

full; and ( c) there was insufficient information available for the Monitor to quantify the

Class Action Claims. Copies of the Notices of Revision and Disallowance with respect

to the Class Action Claims are attached hereto as Exhibits "F", "G", "H" and "I".

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40. The Class Action Claimants provided their notice of dispute on June 27, 2016. The Class

Action Claimants maintain that the Fresh and Amended Statement of Claim delivered to

the Monitor on May 31, 2016 provides sufficient reason in law and equity to support each

of the Class Action Claims. Copies of these Notices of Dispute are attached hereto as

Exhibits "J", "K", "L" and "M".

41. In addition to the Class Action Claims, the former Chief Financial Officer of the

Company, Patrick Leung, filed a Proof of Claim for (a) his dismissal (the "Restructuring

Claim") and (b) a placeholder claim under his indemnity (the "Indemnity Claim") for

any claims that may be filed against him in his capacity as an officer of GuestLogix. A

copy of Mr. Leung's Proof of Claim is attached hereto as Exhibit "N".

42. Mr. Leung's Restructuring Claim was allowed against GuestLogix. The Indemnity

Claim was disallowed as an unsecured claim as all the claims filed against Mr. Leung in

the Claims Process were in respect of an equity interest, and as such, the indemnity claim

would constitute an equity claim. A copy of the Notice of Revision and Disallowance

with respect to Mr. Leung's claim is attached hereto as Exhibit "O".

43. Mr. Leung filed a Notice of Dispute in response to the Notice of Revision and

Disallowance. Mr. Leung did not dispute the classification of the Indemnity Claim as an

equity claim. A copy of the Notice of Dispute filed by Mr. Leung is attached hereto as

Exhibit "P".

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Purpose of this Affidavit

44. I hereby swear this Affidavit in support of the within motion and for no other or improper

purpose.

SWORN before me at the City of Toronto, in the Province of Ontario, this 7th day of September, 2016.

EXHIBIT '' A''



COMMERCIAL LIST


AND

IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. AND GUESTLOGIX IRELAND LIMITED

PLAN OF COMPROMISE AND ARRANGEMENT pursuant to the Companies' Creditors Arrangement Act

concerning, affecting and involving

GUESTLOGIX INC.

July 29, 2016

Applicants

TABLE OF CONTENTS

ARTICLE 1 INTERPRETATION ................................................................................................... 1 1.1 Definitions ............................................................................................................................ 1 1.2 Certain Rules of Interpretation ........................................................................................... 11 1.3 Successors and Assigns ...................................................................................................... 12 1.4 Governing Law .................................................................................................................. 12 1.5 Schedules ........................................................................................................................... 12

ARTICLE 2 PURPOSE AND EFFECT OF THE PLAN .............................................................. 13 2.1 Purpose ............................................................................................................................... 13 2.2 Persons Affected ................................................................................................................ 13 2. 3 Persons Not Affected ......................................................................................................... 13

ARTICLE 3 CLASSIFICATION AND TREATMENT OF CREDITORS AND RELATED MATTERS ..................................................................................................................................... 13 3 .1 Claims Procedure ............................................................................................................... 13 3 .2 Classification of Creditors ................................................................................................. 14 3.3 Meeting .............................................................................................................................. 14 3.4 Unaffected Claims ............................................................................................................. 14 3.5 Unresolved Claims ............................................................................................................. 14 3 .6 Director/Officer Claims ..................................................................................................... 15 3. 7 Extinguishment of Claims .................................................................................................. 15 3 .8 Guarantees and Similar Covenants .................................................................................... 15 3.9 Set-Off16

ARTICLE 4 PROVISIONS REGARDING DISTRIBUTIONS AND PAYMENTS ................... 16 4.1 Treatment of Creditors ....................................................................................................... 16 4.2 Distributions to Affected Unsecured Creditors .................................................................. 16 4.3 Modifications to Distribution Mechanics .......................................................................... 16 4.4 Cancellations of Certificates and Notes ............................................................................. 16 4.5 Currency ............................................................................................................................. 17 4.6 Treatment of Undeliverable Distributions ......................................................................... 17 4. 7 Recourse for Restructuring Costs and Closing Payments .................................................. 18 4.8 Calculations ........................................................................................................................ 18 4.9 Taxes in respect of Distributions ....................................................................................... 18

ARTICLE 5 RESTRUCTURING .................................................................................................. 18 5.1 Corporate Actions .............................................................................................................. 18 5 .2 AssetCo .............................................................................................................................. 19 5.3 Transfer of Transferred Assets to AssetCo ........................................................................ 19 5.4 New Common Shares ........................................................................................................ 19 5.5 Sequence of Plan Implementation Date Transactions ....................................................... 19 5.6 Application of Sections 95 to 101 of the Bankruptcy and Insolvency Act ......................... 21 5. 7 Amendment of the Articles ................................................................................................ 21 5.8 Issuances Free and Clear .................................................................................................... 21 5. 9 Stated Capital ..................................................................................................................... 21 5.10 No Exercise of Right or Remedy ....................................................................................... 21

ARTICLE 6 RELEASES ............................................................................................................... 22 6.1 Plan Releases ..................................................................................................................... 22 6.2 Limitation on Insured Claims ........................................................................................... .22 6.3 Injunctions .......................................................................................................................... 23

ARTICLE 7 COURT SANCTION ................................................................................................ 23 7.1 Application for Sanction Order ......................................................................................... .23 7.2 Sanction Order ................................................................................................................... 23

ARTICLE 8 CONDITIONS PRECEDENT AND IMPLEMENTATION .................................... 25 8.1 Conditions Precedent in Favour of the Company .............................................................. 25 8.2 Conditions Precedent in Favour of the Sponsor ................................................................ 25 8.3 Conditions Precedent in Favour of the Company and the Sponsor ................................... 25 8.4 Monitor's Certificate .......................................................................................................... 27

ARTICLE 9 GENERAL ................................................................................................................ 27 9.1 Binding Effect .................................................................................................................... 27 9.2 Waiver ofDefaults ............................................................................................................. 27 9.3 Deeming Provisions ........................................................................................................... 28 9.4 Non-Consummation ........................................................................................................... 28 9.5 Modification of the Plan .................................................................................................... 28 9.6 Paramountcy ...................................................................................................................... 29 9.7 Severability of Plan Provisions .......................................................................................... 29 9.8 Responsibilities of the Monitor .......................................................................................... 29 9.9 Different Capacities ........................................................................................................... 29 9.10 Notices ............................................................................................................................... 30 9.11 Further Assurances ............................................................................................................. 31

PLAN OF COMPROMISE AND ARRANGEMENT

WHEREAS GuestLogix Inc. (the "Company") is a debtor company under the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended (the "CCAA");

AND WHEREAS the Company obtained protection under the CCAA pursuant to the First Amended and Restated Initial Order (the "Initial Order") of the Ontario Superior Court of Justice (Commercial List) (the "Court") dated as of February 9, 2016 (the "Filing Date");

AND WHEREAS the Company files this plan of compromise and arrangement with the Court pursuant to the CCAA and hereby proposes and presents this plan of compromise and arrangement to the Unsecured Creditors Class (as defined below) under and pursuant to the CCAA.

1.1 Definitions

ARTICLE 1 INTERPRETATION

In the Plan, unless otherwise stated or unless the subject matter or context otherwise requires:

"Affected Claim" means any Claim that is not an Unaffected Claim and, for greater certainty includes any Affected Unsecured Claim and any Equity Claim.

"Agreed Number" means, with respect to the New Common Shares, that number of New Common Shares to be issued to the Sponsor on the Plan Implementation Date pursuant to the Plan as agreed to by the Company and the Sponsor.

"Affected Creditor" means any Creditor with an Affected Claim, but only with respect to and to the extent of such Affected Claim.

"Affected Unsecured Claim" means any Affected Claim against the Company that is not secured by a valid security interest over assets or property of the Company and is not an Equity Claim.

"Affected Unsecured Creditor" means any Creditor with an Affected Unsecured Claim against the Company.

"Applicable Law" means any law, statute, order, decree, judgment, rule, regulation, ordinance or other pronouncement having the effect of law whether in Canada or any other country, or any domestic or foreign state, county, province, city or other political subdivision of any Governmental Entity.

"Articles" means the articles of the Company.

"Articles of Reorganization" means the articles of reorganization of the Company to be filed pursuant to section 186 of the OBCA in accordance with section 5.6 hereof.

- 2 -

"Assessments" means Claims of her Majesty the Queen in Right of Canada or of any province, territory or municipality thereof or any other taxation authority in any Canadian or foreign jurisdiction, including, without limitation, amounts that have arisen or that may arise under any notice of assessment, notice of reassessment, notice of appeal, audit, adjustment, investigation, demand or similar request from any taxation authority and for greater certainty Assessments does not include any Government Priority Claim.

"AssetCo" means a new corporation to be incorporated pursuant to section 5.3 hereof.

"Business Day" means a day, other than Saturday and Sunday, on which banks are generally open for business in Toronto, Ontario.

"CCAA" has the meaning ascribed thereto in the recitals.

"CCAA Proceeding" means the proceeding commenced by the Company pursuant to the CCAA, identified by Court File No.CV-16-11281-00CL.

"Charges" means, collectively, the Administration Charge (as defined in the Initial Order), the Directors' Charge, the KERP Charge (as defined in the KERP Approval Order of the Court dated March 21, 2016), the KEIP Charge (as defined in the KEIP Approval Order of the Court dated March 21, 2016), and any other charges or security interests in respect of the assets, property or undertaking of the Company ordered or created by the Court in the CCAA Proceeding.

"Certificate of Amendment" means the certificate of amendment to be issued pursuant to section 186 of the OBCA in respect of the Articles of Reorganization.

"Claim" means:

(a) any right or claim of any Person against the Company or its assets, property or undertaking, whether or not asserted, in connection with any indebtedness, liability or obligation of any kind whatsoever in existence on the Filing Date, and any interest accrued thereon or costs payable in respect thereof, whether or not such right or claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, unsecured, perfected, unperfected, present, future, known, unknown, by guarantee, by surety or otherwise, and whether or not such right is executory or anticipatory in nature, including any Assessment or CRA Claim and any right or ability of any Person to advance a claim for contribution or indemnity or otherwise against the Company with respect to any matter, action, cause or chose in action, but subject to any counterclaim, set-off or right of compensation in favour of the Company which may exist, whether existing at present or commenced in the future, which indebtedness, liability or obligation is based in whole or in part on facts that existed prior to the Filing Date and any other claims that would have been claims provable in bankruptcy had the Company become bankrupt on the Filing Date, including for greater certainty any Equity Claim and any claim against the Company for indemnification by any Director or Officer in respect of a Director/Officer Claim (but excluding any such claim for indemnification that is covered by the Directors' Charge);

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(b) any right or claim of any Person against the Company in connection with any indebtedness, liability or obligation of any kind whatsoever owed by the Company to such Person arising out of (A) the restructuring, disclaimer, resiliation, termination or breach by the Company on or after the Filing Date of any contract, lease, agreement (including an employee agreement) or arrangement whether written or oral, or (B) any other action taken by or omission of the Company on or after the Filing Date and includes, without limitation, any Assessment or CRA Claim; and

( c) any right or claim of any Person against one or more of the Directors and/or Officers howsoever arising, whether or not such right or claim is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, unsecured, perfected, unperfected, present, future, known, or unknown, by guarantee, surety or otherwise, and whether or not such right is executory or anticipatory in nature, including any Assessment or CRA Claim and any right or ability of any Person to advance a claim for contribution or indemnity or otherwise with respect to any matter, action, cause or chose in action, whether existing at present or commenced in the future, for which any Director or Officer is alleged to be, by statute or otherwise by law or equity, liable to pay in his or her capacity as a Director or Officer (each a "Director/Officer Claim", and collectively, the "Director/Officer Claims").

"Claims Bar Date" means the Prefiling Claims Bar Date or the Restructuring Claims Bar Date, as applicable, as defined in the Claims Procedure Order.

"Claims Procedure Order" means the Order by the Court under the CCAA granted April 29, 2016 establishing a claims procedure in respect of the Company, as same may be further amended, restated or varied from time to time.

"Closing Payments" means the amounts to be paid by the Company pursuant to the Plan or the Transaction Agreement on or prior to the Plan Implementation Date and includes, without limitation, any:

(a) Claim secured by any of the Charges;

(b) Post-Filing Claims;

( c) Transition Costs;

(d) all amounts in respect of Personnel pursuant to section 4.3(2) of the Transaction Agreement, to the extent that such amounts do not constitute Affected Claims, and for greater certainty all obligations to Personnel in respect of termination and severance pay as at the Closing Time shall constitute Affected Claims;

( e) without duplication, all Employee Priority Claims; and

(f) Government Priority Claims.

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"Common Shares" means the common shares in the capital of the Company designated as common shares in the Articles of the Company.

"Company Advisors" means Thornton Grout Finnigan LLP, Wildeboer Dellelce LLP and Canaccord Genuity Corp.

"Consolidation Ratio" means, with respect to the Common Shares, the ratio by which Common Shares outstanding on the Plan Implementation Date at the relevant time (including, for the avoidance of doubt, any Common Shares that are Existing Shares and any Common Shares that are New Common Shares issued pursuant to the Plan) are consolidated pursuant to the Plan, as agreed by the Company and the Sponsor.

"Court" has the meaning ascribed thereto in the recitals.

"CRA Claim" means any Claim of the Her Majesty the Queen in Right of Canada, the Canada Revenue Agency or any other Person relating in any manner whatsoever to any failure by the Company and/or any Director or Officer to (i) comply with the Excise Tax Act or any Assessment, or (ii) charge, collect or remit goods and services tax and/or harmonized sales tax in accordance with the Excise Tax Act or any other Applicable Law with respect to goods and services tax or harmonized sales tax, including any Claim for interest, penalties, fines, charges, return of refunds or input tax credit or other amounts of any nature whatsoever and for greater certainty CRA Claim does not include any Government Priority Claim.

"Creditor" means any Person having a Claim, but only with respect to and to the extent of such Claim, including the transferee or assignee of a transferred Claim that is recognized as a Person having a Claim in accordance with the Claims Procedure Order or a trustee, executor, liquidator, receiver, receiver and manager or other Person acting on behalf of or through such Person.

"Customer Prepayments" has the meaning ascribed to it in the Transaction Agreement.

"Debentureholders" means the holders of the Debentures.

"Debenture Obligations" means all obligations, liabilities, indebtedness of, or Claims against, the Company under, arising out of or in connection with the Indenture or the Debentures.

"Debentures" means the 7% extendible convertible unsecured subordinated debentures due December 31, 2019 issued pursuant to the Indenture.

"Director/Officer Claim" has the meaning ascribed thereto within the definition of "Claim" above.

"Directors" means all current and former directors of the Company, in such capacity, and any person deemed to be a director or former director of the Company, and "Director" means any one of them.

"Directors' Advisors" means Osler, Hoskin & Harcourt LLP.

"Directors' Charge" has the meaning ascribed to it in the Initial Order.

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"Distribution Date" means the date or dates from time to time set by the Monitor to effect distributions in respect of the Proven Distribution Claims, which date or dates may be on or after the Plan Implementation Date.

"Effective Time" means 12:01 a.m. (Toronto Time) on the Plan Implementation Date or such other time on such date as the Company may determine.

"Employees" means the present and former employees of the Company.

"Employee Priority Claims" means the following Claims of Employees of the Company:

(a) Claims equal to the amounts that such Employees would have been entitled to receive under paragraph 136(l)(d) of the Bankruptcy and Insolvency Act (Canada) if the Company had become bankrupt on the Filing Date; and

(b) Claims for wages, salaries, commissions or compensation for services rendered by such Employees after the Filing Date and on or before the Court sanctions this Plan together with, in the case of travelling salespersons, disbursements properly incurred by them in and about the Company's business during the same period.

"Encumbrance" means any charge, mortgage, lien, pledge, hypothec, security interest or other encumbrance whether created or arising by agreement, statute or otherwise at law, attaching to property, interests or rights and shall be construed in the widest possible terms and principles known under the law applicable to such property, interests or rights and whether or not they constitute specific or floating charges as those terms are understood under the laws of the Province of Ontario.

"Equity Claim" means a Claim that meets the definition of "equity claim" in section 2(1) of the CCAA and includes, without limitation, any Claim relating to the alleged failure of the Company to comply with revenue recognition or other accounting policies applicable to the Company prior to the Filing Date, including without limitation any Claim asserted in the class action lawsuit commenced in the Ontario Superior Court of Justice, bearing court file number CV-16-545118-00CP, by Morganti Legal or any Proof of Claim filed in respect of such matters.

"Equity Claimants" means any Person with an Equity Claim, but only in such capacity.

"Equity Interests" has the meaning ascribed thereto in section 2(1) of the CCAA and includes the Existing Shares, any shareholder agreement in respect of the Existing Shares, the Existing Options and any other interest in or entitlement to shares in the capital of the Company, but, for greater certainty, does not include the New Common Shares issued on the Plan Implementation Date in accordance with the Plan.

"Existing Options" means any options, warrants, conversion privileges, puts, calls, subscriptions, exchangeable securities, restricted share units, share purchase programs or other rights, entitlements, agreements, arrangements or commitments (pre-emptive, contingent or otherwise) obligating the Company to issue, acquire or sell shares or units in the capital of the Company or to purchase any shares, units, securities, options or warrants, or any securities or obligations of any kind convertible into or exchangeable for shares or units in the capital of the Company, in each case that are existing or issued and outstanding immediately prior to the

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Effective Time, including any options to acquire shares, units or other equity securities of the Company issued under the Stock Option Plans, any warrants exercisable for common shares, units or other equity securities of the Company, any put rights exercisable against the Company in respect of any shares, units, options, warrants or other securities, and any rights, entitlements or other claims of any kind to receive any other form of consideration in respect of any prior or future exercise of any of the foregoing.

"Existing Shareholder" means any Person who holds, is entitled to or has any rights in or to the Existing Shares or any shares in the authorized capital of the Company immediately prior to the Effective Time, but only in such capacity, and for greater certainty does not include any Person that is issued New Common Shares on the Plan Implementation Date.

"Existing Shares" means all shares in the capital of the Company that are issued and outstanding immediately prior to the Effective Time and, for greater certainty, does not include any New Common Shares issued on the Plan Implementation Date.

"Filing Date" has the meaning ascribed thereto in the recitals.

"Final Order" means any order, ruling or judgment of the Court, or any other court of competent jurisdiction, (i) that is in full force and effect; (ii) that has not been reversed, modified or vacated and is not subject to any stay; and (iii) in respect of which all applicable appeal periods have expired and any appeals therefrom have been finally disposed of, leaving such order, ruling or judgment wholly operable.

"Government Priority Claim" means all Claims of Governmental Entities against the Company in respect of amounts that are outstanding and that are of a kind that could be subject to a demand under:

(a) subsection 224(1.2) of the Tax Act;

(b) any provision of the Canada Pension Plan or the Employment Insurance Act that refers to subsection 224(1.2) of the Tax Act and provides for the collection of a contribution, as defined in the Canada Pension Plan, an employee's premium or employer's premium, as defined in the Employment Insurance Act, or a premium under Part VIL I of that Act, and of any related interest, penalties or other amounts; or

( c) any provision of provincial legislation that has a similar purpose to subsection 224(1.2) of the Tax Act, or that refers to that subsection, to the extent that it provides for the collection of a sum, and of any related interest, penalties or other amounts, where the sum:

(i) has been withheld or deducted by a person from a payment to another person and is in respect of a tax similar in nature to the income tax imposed on individuals under the Tax Act; or

(ii) is of the same nature as a contribution under the Canada Pension Plan if the province is a "province providing a comprehensive pension plan" as defined in subsection 3(1) of the Canada Pension Plan and the provincial

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legislation establishes a "provincial pension plan" as defined m that subsection.

"Governmental Entity" means any government, regulatory authority, governmental department, agency, commission, bureau, official, minister, Crown corporation, court, board, tribunal or dispute settlement panel or other law, rule or regulation-making organization or entity: (a) having or purporting to have jurisdiction on behalf of any nation, province, territory or state or any other geographic or political subdivision of any of them; or (b) exercising, or entitled or purporting to exercise, any administrative, executive, judicial, legislative, policy, regulatory or taxing authority or power.

"Indenture" means the indenture dated December 22, 2014 between the Company and the Indenture Trustee in connection with the issuance of the Debentures.

"Indenture Trustee" means Equity Financial Trust Company, as trustee in respect of the Debentures under the Indenture.

"Individual Plan Entitlement" means, with respect to each Affected Unsecured Creditor with a Proven Distribution Claim, its entitlement to receive its respective individual portion of the Unsecured Creditors Distribution Pool, the quantum of which entitlement shall be calculated as follows at the relevant time:

(A) the Proven Distribution Claim of such Affected Unsecured Creditor

divided by

(B) the total amount of all Proven Distribution Claims and Unresolved Claims of Affected Unsecured Creditors,

multiplied by

(C) the amount of the Unsecured Creditors Distribution Pool.

"Initial Order" has the meaning ascribed thereto in the recitals.

"Insurance Policy" means any insurance policy maintained by the Company pursuant to which the Company or any Director or Officer is insured.

"Insured Claim" means all or that portion of a Claim arising from a cause of action for which the applicable insurer or a court of competent jurisdiction has confirmed or may hereafter confirm that the Company or a Director or Officer is insured under an Insurance Policy, to the extent that such Claim, or portion thereof, is so insured.

"Meeting Date" means the date on which the Meeting is held in accordance with the Meeting Order.

"Meeting" means the meeting of Affected Unsecured Creditors having Proven Voting Claims or Unresolved Claims called for the purpose of considering and voting on this Plan in accordance with the terms of the CCAA and the Meeting Order.

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"Meeting Order" means the Order of the Court pursuant to the CCAA that, among other things, authorizes the Company to hold the Meeting, as such Order may be amended, restated or varied from time to time.

"Monitor" means PricewaterhouseCoopers Inc., in its capacity as the Court-appointed monitor of the Company in the CCAA Proceeding.

"New Common Shares" means the new Common Shares to be issued pursuant to section 5.4 hereof.

"OBCA" means the Business Corporations Act (Ontario), R.S.O. 1990, c. B.16, as amended.

"Officers" means all current and former officers of the Company, in such capacity, and "Officer" means any one of them.

"Order" means any order of the Court made in connection with the CCAA Proceeding.

"Person" means any individual, partnership, limited partnership, joint venture, trust, corporation, unincorporated organization, government or agency or instrumentality thereof, or any other corporate, executive, legislative, judicial, regulatory or administrative entity howsoever designated or constituted, including, without limitation, any present or former shareholder, supplier, customer, employee, agent, client, contractor, lender, lessor, landlord, sub-landlord, tenant, sub-tenant, licensor, licensee, partner or advisor.

"Personnel" has the meaning ascribed thereto in the Transaction Agreement.

"Plan" means this Plan of Compromise and Arrangement filed by the Company pursuant to the CCAA, as it may be amended, supplemented or restated from time to time in accordance with the its terms.

"Plan Implementation Date" means the Business Day on which the Plan becomes effective, which shall be the Business Day on which the Monitor delivers the certificate pursuant to section 8.4 hereof stating that the Plan Implementation Date has occurred.

"Post-Filing Claims" means obligations, claims or indebtedness that were incurred by the Company after the Filing Date but before the Plan Implementation Date.

"Proof of Claim" has the meaning ascribed thereto in the Claims Procedure Order.

"Proven Distribution Claim" means an Affected Unsecured Claim finally determined, settled or accepted for distribution purposes in accordance with the provisions of the Claims Procedure Order, the Meeting Order and this Plan, as applicable.

"Proven Voting Claim" means an Affected Unsecured Claim finally determined, settled or accepted for voting purposes in accordance with the provisions of the Claims Procedure Order, the Meeting Order and this Plan, as applicable.

"Released Claims" means any and all demands, claims, actions, causes of action, counterclaims, suits, debts, sums of money, accounts, covenants, damages, judgments, orders, including for

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injunctive relief or specific performance and compliance orders, expenses, executions, Encumbrances and other recoveries on account of any liability, obligation, demand or cause of action of whatever nature, including claims for contribution or indemnity, whether known or unknown, matured or unmatured, direct, indirect or derivative, foreseen or unforeseen, existing or hereafter arising, based in whole or in part on any act, omission, transaction, duty, responsibility, indebtedness, liability, obligation, dealing or other occurrence: (i) existing or taking place on or prior to the Plan Implementation Date that constitute or are in any way relating to, arising out of or in connection with any Claims, any Director/Officer Claims and any indemnification obligations with respect thereto, any Equity Claims, the Debentures, the Indenture, the Debenture Obligations, the Equity Interests, the Stock Option Plans, the New Common Shares, the Individual Plan Entitlement, the business and affairs of the Company whenever or however conducted, the administration and/or management of the Company, the Restructuring, the Plan, the CCAA Proceeding, or any document, instrument, matter or transaction involving the Company taking place in connection with the Restructuring or the Plan; or (ii) existing or taking place on or prior to the date on which actions are taken to implement the Plan and that arise out of those actions taken to implement the Plan,

"Released Director/Officer Claim" means any Director/Officer Claim that is released pursuant to section 6.1.

"Released Party" and "Released Parties" have the meaning ascribed thereto in section 6.1.

"Required Majority" means with respect to the Unsecured Creditors Class, a majority in number of Affected Unsecured Creditors with Proven Voting Claims representing at least two thirds in value of the Proven Voting Claims of Affected Unsecured Creditors, in each case who are entitled to vote at the Meeting in accordance with the Meeting Order and who are present and voting in person or by proxy on the resolution approving the Plan at the Meeting.

"Restructuring" means the transactions contemplated by the Plan and the Transaction Agreement.

"Restructuring Costs" means the administrative costs incurred in connection with the implementation and completion of the Restructuring, the Plan and the CCAA Proceeding whether payable prior to, on or after the Plan Implementation Date, including, without limitation, any amount that is reserved to address the reasonable fees and expenses of the Company Advisors, the Directors' Advisors, the Monitor and the Monitor's counsel following the Plan Implementation Date.

"Sanction Order" means the Order of the Court sanctioning and approving the Plan.

"Sponsor" means GXI Acquisition Corp.

"Sponsor Advisors" means Goodmans LLP.

"Stock Option Plans" means any options plans, stock-based compensation plans or other obligations of the Company in respect of shares, options or warrants for equity in the Company, in each case as such plans or other obligations may be amended, restated or varied from time to time in accordance with the terms thereof.

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"Tax Act" means the Income Tax Act (Canada), as amended.

"Total Proceeds" means the aggregate amount of cash, cash equivalents and marketable securities held by the Company on the Plan Implementation Date, but excluding all Customer Prepayments.

"Transaction Agreement" means the agreement dated as of June 30, 2016 between the Company and the Sponsor and approved by the Court pursuant to the Transaction Approval and Vesting Order dated July 13, 2016, as such agreement may be or has been amended or modified from time to time.

"Transferred Assets" means all right, title and interest of the Company in and to the assets, property and undertaking listed on Schedule A hereto.

"Transition Costs" means, collectively, the Cure Costs, Assignment Fees and Consent Fees ( each as defined in the Transaction Agreement) payable by the Company on or prior to the Plan Implementation Date pursuant to the terms of the Transaction Agreement.

"Unaffected Claim" means any:

(a) Claim secured by any of the Charges;

(b) Insured Claim;

( c) Claim in respect of Customer Prepayments;

(d) Post-Filing Claims;

( e) Transition Costs;

(f) Employee Priority Claims;

(g) Government Priority Claims; and

(h) Claim that is not permitted to be compromised pursuant to section 19(2) or 5.1 (2) of the CCAA.

"Unaffected Creditor" means a Creditor who has an Unaffected Claim, but only in respect of and to the extent of such Unaffected Claim.

"Undeliverable Distribution" has the meaning ascribed thereto in section 4.6 hereof.

"Unresolved Claim" means any Affected Unsecured Claim or any Proof of Claim that is, at the relevant time, in dispute for voting and/or distribution purposes pursuant to the Claims Procedure Order.

"Unresolved Claims Reserve" means cash reserved from the Total Proceeds and held in one or more separate non-interest bearing accounts, in the aggregate amount sufficient to pay each holder of an Unresolved Claim the lesser of: (a) the amount of cash that such holder would have

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been entitled to receive under this Plan if such Umesolved Claim had been a Proven Distribution Claim on the Plan Implementation Date; and (b) such amount as the Court may otherwise determine.

"Unsecured Creditors Class" means a class of Persons consisting of those Affected Unsecured Creditors having Proven Voting Claims established in accordance with Article 3 hereof.

"Unsecured Creditors Distribution Pool" means, collectively, the Total Proceeds, less:

(a) Restructuring Costs as determined by the Monitor; and

(b) without duplication, all amounts required to pay the Closing Payments and to discharge all Claims with respect thereto.

1.2 Certain Rules of Interpretation

For the purposes of the Plan:

(a) any reference in the Plan to a contract, instrument, release, indenture or other agreement or document being in a particular form or on particular terms and conditions means that such document shall be substantially in such form or substantially on such terms and conditions;

(b) any reference in the Plan to an Order or an existing document or exhibit filed or to be filed means such Order, document or exhibit as it may have been or may be amended, modified, or supplemented;

( c) unless otherwise specified, all references to currency are in United States dollars;

( d) the division of the Plan into "articles" and "sections" and the insertion of a table of contents are for convenience of reference only and do not affect the construction or interpretation of the Plan, nor are the descriptive headings of "articles" and "sections" intended as complete or accurate descriptions of the content thereof;

(e) the use of words in the singular or plural, or with a particular gender, including a definition, shall not limit the scope or exclude the application of any provision of the Plan or a schedule hereto to such Person ( or Persons) or circumstances as the context otherwise permits;

(f) the words "includes" and "including" and similar terms of inclusion shall not, unless expressly modified by the words "only" or "solely", be construed as terms of limitation, but rather shall mean "includes but is not limited to" and "including but not limited to", so that references to included matters shall be regarded as illustrative without being either characterizing or exhaustive;

(g) unless otherwise specified, all references to time herein and in any document issued pursuant hereto mean Eastern Time and any reference to an event

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occurring on a Business Day shall mean prior to 5:00 p.m. (Toronto Time) on such Business Day;

(h) unless otherwise specified, time periods within or following which any payment is to be made or act is to be done shall be calculated by excluding the day on which the period commences and including the day on which the period ends and by extending the period to the next succeeding Business Day if the last day of the period is not a Business Day;

(i) unless otherwise provided, any reference to a statute or other enactment of parliament or a legislature includes all regulations made thereunder, all amendments to or re-enactments of such statute or regulations in force from time to time, and, if applicable, any statute or regulation that supplements or supersedes such statute or regulation; and

(j) references to a specified "article" or "section" shall, unless something in the subject matter or context is inconsistent therewith, be construed as references to that specified article or section of the Plan, whereas the terms "the Plan", "hereof, "herein", "hereto", "hereunder" and similar expressions shall be deemed to refer generally to the Plan and not to any particular "article", "section" or other portion of the Plan and include any documents supplemental hereto.

1.3 Successors and Assigns

The Plan shall be binding upon and shall enure to the benefit of the heirs, administrators, executors, legal personal representatives, successors and assigns of any Person or party directly or directly named or referred to in or subject to the Plan.

1.4 Governing Law

The Plan shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. All questions as to the interpretation of or application of the Plan and all proceedings taken in connection with the Plan and its provisions shall be subject to the jurisdiction of the Court.

1.5 Schedules

The following are the Schedules to the Plan, which are incorporated by reference into the Plan and form a part of it:

Schedule A Transferred Assets

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ARTICLE2 PURPOSE AND EFFECT OF THE PLAN

2.1 Purpose

The purpose of the Plan is:

(a) to implement a recapitalization of the Company;

(b) to provide for a settlement of, and consideration for, all Affected Claims;

( c) to effect a release and discharge of all Affected Claims and other Released Claims; and

(d) to ensure the continuation of the Company,

in the expectation that the Persons who have an economic interest in the Company will derive a greater benefit from the implementation of the Plan than they would derive from any other alternative in respect of the Company.

2.2 Persons Affected

The Plan provides for a full and final release and discharge of the Affected Claims and Released Claims, a settlement of, and consideration for, all Affected Claims and a recapitalization of the Company. The Plan will become effective at the Effective Time in accordance with its terms and in the sequence set forth in section 5.5 and shall be binding on and enure to the benefit of the Company, the Affected Creditors, the Released Parties and all other Persons directly or indirectly named or referred to in or subject to Plan.

2.3 Persons Not Affected

The Plan does not affect the Unaffected Creditors, subject to the express provisions hereof providing for the treatment of Insured Claims. Nothing in the Plan shall affect the Company's rights and defences, both legal and equitable, with respect to any Unaffected Claims including all rights with respect to legal and equitable defences or entitlements to set-offs or recoupments against such Unaffected Claims.

ARTICLE3 CLASSIFICATION AND TREATMENT OF CREDITORS AND RELATED MATTERS

3.1 Claims Procedure

The procedure for determining the validity and quantum of the Affected Claims for voting and distribution purposes under the Plan shall be governed by the Claims Procedure Order, the Meeting Order, the CCAA, the Plan and any further Order of the Court.

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3.2 Classification of Creditors

In accordance with the Meeting Order, there shall be one class of Creditors for the purpose of considering and voting on this Plan, being the Unsecured Creditors Class.

Equity Claimants shall not receive any consideration or distributions under this Plan and shall not be entitled to vote on this Plan at the Meeting.

3.3 Meeting

The Meeting shall be held in accordance with the Meeting Order and any further Order of the Court. The only Persons entitled to attend and vote at the Meeting are those specified in the Meeting Order.

3.4 Unaffected Claims

(a) Unaffected Claims shall not be compromised, released, discharged, cancelled or barred by the Plan.

(b) Except to the extent that an Unaffected Claim is satisfied by the payment of a Closing Payment pursuant to section 5.5(a) hereof, Unaffected Creditors will not receive any consideration or distributions under the Plan in respect of their Unaffected Claims. Unaffected Creditors shall not be entitled to vote on the Plan at the Meeting in respect of their Unaffected Claims.

(c) Notwithstanding anything to the contrary in the Plan, Insured Claims shall not be compromised, released, discharged, cancelled or barred by the Plan, provided that from and after the Plan Implementation Date, any Person having an Insured Claim shall be irrevocably limited to recovery in respect of such Insured Claim solely from the proceeds of the applicable Insurance Policies, and Persons with any Insured Claims shall have no right to, and shall not, directly or indirectly, seek any recoveries from any Person, including the Company, the Directors or Officers or any other Released Party, other than enforcing such Person's rights to be paid by the applicable insurer(s) from the proceeds of the applicable Insurance Policies. This section 3 .4( c) may be relied upon and raised or pled by the Company, a Director, an Officer or any other Released Party in defence or estoppel of or to enjoin any claim, action or proceeding brought in contravention of this section. Nothing in the Plan shall prejudice, compromise, release or otherwise affect any right or defence of any insurer in respect of an Insurance Policy or any insured in respect of an Insured Claim.

3.5 Unresolved Claims

(a) Any Affected Unsecured Creditor with an Unresolved Claim shall not be entitled to receive any distribution hereunder with respect to such Unresolved Claim unless and until such Claim becomes a Proven Distribution Claim.

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(b) An Unresolved Claim shall be resolved in the manner set out in the Claims Procedure Order. Distributions pursuant to section 4.2 hereof shall be made in respect of any Unresolved Claim that is finally determined to be a Proven Distribution Claim in accordance with the Claims Procedure Order.

( c) On the date that all Unresolved Claims have been finally resolved in accordance the Claims Procedure Order, the Monitor shall release all remaining cash, if any, from the Unresolved Claims Reserve and shall distribute such cash to the Affected Unsecured Creditors with Proven Distribution Claims in accordance with section 4.2(b) hereof.

3.6 Director/Officer Claims

All Released Director/Officer Claims shall be fully, finally, irrevocably and forever compromised, released, discharged, cancelled and barred on the Plan Implementation Date. Any Director/Officer Claim that is not a Released Director/Officer Claim will not be compromised, released, discharged, cancelled and barred. For greater certainty, any Claim of a Director or Officer against the Company for indemnification or contribution in respect of any Director/Officer Claim ( other than any such claim for indemnification that is covered by the Directors' Charge) shall be treated for all purposes under the Plan as an Affected Claim that is compromised, released and discharged pursuant to the Plan.

3. 7 Extinguishment of Claims

On the Plan Implementation Date, in accordance with the terms and in the sequence set forth in section 5.5 and in accordance with the provisions of the Sanction Order, the treatment of Affected Claims and Released Claims, in each case as set forth herein, shall be final and binding on the Company, all Affected Creditors and any Person having a Released Claim (and their respective heirs, executors, administrators, legal personal representatives, successors and assigns), and all Affected Claims and all Released Claims shall be fully, finally, irrevocably and forever released, discharged, cancelled and barred, and the Company and the Released Parties shall thereupon have no further obligation whatsoever in respect of the Affected Claims or the Released Claims; provided that nothing herein releases the Company or any other Person from their obligations to make distributions in the manner and to the extent provided for in the Plan and provided further that such discharge and release of the Company shall be without prejudice to the right of a Creditor in respect of an Unresolved Claim to prove such Unresolved Claim in accordance with the Claims Procedure Order so that such Unresolved Claim may become a Proven Distribution Claim that is entitled to receive consideration under section 4.2 hereof.

3.8 Guarantees and Similar Covenants

No Person who has a Claim under any guarantee, surety, indemnity or similar covenant in respect of any Claim that is compromised and released under the Plan or who has any right to claim over in respect of or to be subrogated to the rights of any Person in respect of a Claim that is compromised under the Plan shall be entitled to any greater rights than the Person whose Claim is compromised under the Plan.

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3.9 Set-Off

The law of set-off applies to all Claims.

ARTICLE4 PROVISIONS REGARDING DISTRIBUTIONS AND PAYMENTS

4.1 Treatment of Creditors

For purposes of this Plan, the Affected Unsecured Creditors shall receive the treatment provided in this Article 4 and, on the Plan Implementation Date, all Affected Claims will be compromised in accordance with the terms of this Plan.

4.2 Distributions to Affected Unsecured Creditors

(a) In accordance with the steps and sequence set forth in section 5.5, under the supervision of the Monitor, each Affected Unsecured Creditor having a Proven Distribution Claim shall become entitled to its Individual Plan Entitlement on the Plan Implementation Date without any further steps or actions by the Company, such Affected Unsecured Creditor or any other Person.

(b) On the applicable Distribution Date, the Monitor shall calculate the amount of the Unsecured Creditors Distribution Pool and the Individual Plan Entitlement to be paid to each applicable Affected Unsecured Creditor with a Proven Distribution Claim. The Monitor shall also calculate the amount of Unsecured Creditors Distribution Pool that is not to be distributed as a result of Unresolved Claims that remain outstanding, if any. The Monitor shall then distribute the applicable amount by way of cheque sent by prepaid ordinary mail, or in such other manner as the Monitor may determine, to each Affected Unsecured Creditor with a Proven Distribution Claim. With respect to any portion of the Unsecured Creditors Distribution Pool that is reserved in respect of Unresolved Claims, the Monitor shall segregate such amounts and hold such amounts in the Unresolved Claims Reserve.

4.3 Modifications to Distribution Mechanics

The Company and the Monitor shall be entitled to make such additions and modifications to the process for making distributions pursuant to the Plan as the Company and the Monitor deem necessary or desirable in order to achieve the proper distribution and allocation of consideration to be distributed pursuant to the Plan, and such additions or modifications shall not require an amendment to the Plan or any further Order of the Court, provided that any addition or modification to the process for making distributions pursuant to the Plan that affects the rights or interests of the Sponsor shall require the prior consent of the Sponsor.

4.4 Cancellations of Certificates and Notes

Following completion of the steps in the sequence set forth in section 5.5, all Debentures, notes, certificates, invoices and other instruments evidencing Affected Claims, Debenture Obligations or Equity Interests will not entitle any holder thereof to any compensation or participation other

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than as expressly provided for in the Plan and will be cancelled and will be null and void. Notwithstanding the foregoing, if and to the extent the Indenture Trustee is required to transfer consideration issued pursuant to this Plan to the Debentureholders, then the Indenture shall remain in effect solely for the purpose of and to the extent necessary to: (i) allow the Indenture Trustee to make such distributions to the Debentureholders on the initial Distribution Date and each subsequent Distribution Date (if applicable); and (ii) maintain all of the protections the Indenture Trustee enjoys pursuant to the Indenture, including its lien rights with respect to any distributions under the Plan, until all distributions are made to the Debentureholders hereunder. For greater certainty, any and all obligations of the Company under and with respect to the Debentures and the Indenture, including the Debenture Obligations, shall be extinguished on the Plan Implementation Date and shall not continue beyond the Plan Implementation Date.

4.5 Currency

Unless specifically provided for in the Plan, all monetary amounts referred to in the Plan shall be denominated in United States dollars and, for the purposes of distributions under the Plan, Claims shall be denominated in United States dollars and all payments and distributions provided for in the Plan shall be made in United States dollars. Any Claims denominated in a foreign currency shall be converted to United States dollars at the Bank of Canada noon exchange rate in effect at the Filing Date.

4.6 Treatment of Undeliverable Distributions

If any Affected Unsecured Creditor's distribution under this Article 4 is returned as undeliverable or remains uncashed six months after mailing (an "Undeliverable Distribution"), no further distributions to such Creditor shall be made unless and until the Company or the Monitor is notified by such Affected Unsecured Creditor of such Affected Unsecured Creditor's current address, at which time all such distributions shall be made to such Affected Unsecured Creditor. All claims for Undeliverable Distributions must be made on or before the date that is six months following the final Distribution Date, after which date any entitlement with respect to such Undeliverable Distribution shall be forever discharged and forever barred, without any compensation therefor, notwithstanding any federal, state or provincial laws to the contrary. At such time, any Undeliverable Distributions shall be aggregated and if the aggregate of such Undeliverable Distributions is: (i) equal to or greater than $50,000, (x) such Undeliverable Distributions shall be paid to the Affected Unsecured Creditors with Proven Distribution Claims on a pro rata basis, provided that the Monitor shall not be required to make a distribution to an Affected Unsecured Creditor where such distribution would be less than $50 and (y) any amount remaining after the distribution described in the previous clause (x) shall be returned to the Company; or (ii) less than $50,000, all such Undeliverable Distributions shall be returned to the Company. Nothing contained in the Plan shall require the Company or the Monitor to attempt to locate any Person to whom a distribution is payable. No interest is payable in respect of an Undeliverable Distribution. Unless otherwise expressly agreed by the Monitor and the Company in writing, any distribution under the Plan on account of the Debentures shall be deemed made when delivered to the Indenture Trustee.

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4. 7 Recourse for Restructuring Costs and Closing Payments

In the event that any Restructuring Costs or Closing Payments arise or are payable following the Plan Implementation Date and sufficient funds to satisfy such amounts have not been specifically reserved pursuant to the terms of this Plan, such amounts shall be payable solely from the Unsecured Creditors Distribution Pool. For greater certainty, there shall be no recourse against the Company for any Restructuring Costs or Closing Payments from and after the Effective Time and no Person shall have any claim, right or interest against the Company or its property, assets or undertaking from and after the Effective Time with respect to Restructuring Costs or Closing Payments.

4.8 Calculations

All amounts of consideration to be received hereunder will be calculated to the nearest cent ($0.01 ). All calculations and determinations made by the Monitor and/or the Company and agreed to by the Monitor for the purposes of the Plan, including, without limitation, the allocation of consideration, shall be conclusive, final and binding upon the Affected Creditors and the Company.

4.9 Taxes in respect of Distributions

Notwithstanding any other provision of this Plan, each Affected Unsecured Creditor that is to receive a distribution pursuant to this Plan will have sole and exclusive responsibility for the satisfaction and payment of any tax obligation imposed by any Governmental Authority (including income and other tax obligations) on account of such distribution.

To the extent that amounts are withheld or deducted from any distributions, payments or disbursements and paid over to the applicable taxing authority in accordance with Applicable Law, such withheld or deducted amounts shall be treated for all purposes of this Plan as having been paid to such Affected Unsecured Creditor. No gross-up or other adjustment will be made to any distributions to Affected Unsecured Creditors under this Plan on account of any amounts so deducted or withheld from any distribution.

ARTICLES RESTRUCTURING

5.1 Corporate Actions

The adoption, execution, delivery, implementation and consummation of all matters contemplated under the Plan involving corporate actions of the Company will occur and be effective as of the Plan Implementation Date, and shall be deemed to be authorized and approved under the Plan and by the Court, where applicable, as part of the Sanction Order, in all respects and for all purposes without any requirement of further action by shareholders, directors or officers of the Company. All necessary approvals to take actions shall be deemed to have been obtained from the directors, officers or shareholders of the Company, as applicable, including the deemed passing by any class of shareholders of any resolution or special resolution and any shareholders' agreement or agreement between a shareholder and another Person limiting in any

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way the right to vote shares held by such shareholder or shareholders with respect to any of the steps contemplated by the Plan shall be deemed to have no force or effect.

5.2 AssetCo

AssetCo shall be incorporated prior to the Plan Implementation Date and shall not be an affiliate of the Company. At the time that AssetCo is incorporated, AssetCo shall issue one common share to a shareholder that is not an affiliate of the Company prior to the Plan Implementation Date, as the sole shareholder of AssetCo. The Company shall have no liability whatsoever for any liability or obligation of AssetCo.

5.3 Transfer of Transferred Assets to AssetCo

(a) On the Plan Implementation Date, immediately prior to the initiation of the sequence of steps and transactions referred to in section 5.5 hereof, all Transferred Assets shall be transferred to AssetCo together with (and, for greater certainty, not free and clear of) any and all Encumbrances in respect of such Transferred Assets. Any and all Affected Claims in respect of the Transferred Assets shall be fully, finally, irrevocably and forever released, waived, discharged, cancelled and barred on the Plan Implementation Date as against the Company, the Directors and the Officers, provided that any litigation or enforcement process against the Company for a non-monetary remedy in respect of any such Transferred Assets may be continued against (and in the name of) AssetCo (and, for greater certainty, not against the Company). The style of cause of any such litigation or enforcement process in respect of such Transferred Assets shall be amended such that AssetCo, not the Company, is the party named in the applicable litigation or enforcement process.

(b) The Company, with the consent of the Monitor, shall be permitted to transfer to AssetCo prior to the Plan Implementation Date an amount sufficient to provide for the costs associated with the liquidation and dissolution of AssetCo.

5.4 New Common Shares

On the Plan Implementation Date, in the sequence set forth in section 5.5 and under the supervision of the Monitor, the Company shall issue the Agreed Number of New Common Shares to the Sponsor in exchange for the payment by the Sponsor of the Subscription Price (as defined in the Transaction Agreement) pursuant to the terms of the Transaction Agreement.

5.5 Sequence of Plan Implementation Date Transactions

The following steps, compromises and releases to be effected in the implementation of the Plan shall occur, and be deemed to have occurred, in the following order in five minute increments (unless otherwise noted), without any further act or formality on the Plan Implementation Date beginning at the Effective Time:

(a) the Company shall pay, or cause to be paid, all Closing Payments;

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(b) all Existing Options shall be cancelled and terminated without any liability, payment or other compensation in respect thereof;

( c) the Stock Option Plans shall be terminated;

(d) each Affected Unsecured Creditor with a Proven Distribution Claim shall become entitled to its Individual Plan Entitlement (as it may be adjusted based on the final determination of Unresolved Claims in the manner set forth herein) in full consideration for the irrevocable, final and full compromise, satisfaction and release of such Affected Unsecured Creditor's Affected Unsecured Claim, and each such Affected Unsecured Creditor shall be entitled to receive a distribution from the Unsecured Creditors Distribution Pool for its Individual Plan Entitlement in accordance with this Plan on the Distribution Date;

(e) upon receipt by the Monitor of the Closing Cash Payment (as defined in the Transaction Agreement), the Company shall issue to the Sponsor the Agreed Number of New Common Shares;

(f) the Articles shall be altered to, among other things, (i) consolidate the issued and outstanding Common Shares (including, for the avoidance of doubt, Common Shares that are Existing Shares and New Common Shares issued pursuant to section 5.5(e)) on the basis of the Consolidation Ratio; and (ii) provide for such additional changes to the rights and conditions attached to the Common Shares as may be agreed to by the Company and the Sponsor;

(g) any fractional Common Shares held by any holder of Common Shares immediately following the consolidation of the Common Shares referred to in section 5.5(f) shall be cancelled without any liability, payment or other compensation in respect thereof, and the Articles shall be altered as necessary to achieve such cancellation;

(h) all Equity Interests (for greater certainty, not including any New Common Shares that remain issued and outstanding immediately following the cancellation of fractional interests in section 5.5(g)) shall be cancelled and extinguished without any liability, payment or other compensation in respect thereof and all Equity Claims shall be fully, finally, irrevocably and forever compromised, released, discharged, cancelled and barred without any liability, payment or other compensation in respect thereof;

(i) subject only to section 4.4 hereof, the Debentures, the Indenture and all Debenture Obligations shall be deemed to be fully, finally, irrevocably and forever compromised, released, discharged, cancelled and barred;

G) all Affected Claims remaining after the step referred to in section 5.5(i) shall be fully, finally, irrevocably and forever compromised, released, discharged cancelled and barred without any liability, payment or other compensation in respect thereof;

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(k) any right of indemnity or contribution of a Director, Officer or Employee against the Company of any nature whatsoever (whether pursuant to a written contract or agreement or otherwise, and whether present or future or known or unknown) shall be fully, finally, irrevocably and forever terminated, extinguished, compromised, released, discharged, cancelled and barred without any liability, payment or other compensation in respect thereof and each Director, Officer or Employee shall be permanently barred, estopped, stayed and enjoined, on and after the Plan Implementation Date, from asserting any such right of indemnity or contribution against the Company;

(1) all current Directors shall be deemed to have resigned from the board of directors of the Company, and the Persons named on a certificate to be filed with the Court by the Company on or prior to the Plan Implementation Date shall be appointed to the board of directors of the Company; and

(m) the releases set forth in Article 6 shall become effective.

5.6 Application of Sections 95 to 101 of the Bankruptcy and Insolvency Act

Sections 95 to 101 of the Bankruptcy and Insolvency Act (Canada) shall not apply to any of the transactions implemented pursuant to this Plan.

5. 7 Amendment of the Articles

The steps described in sub-sections (f), (g) and (1) of section 5.5 will be implemented pursuant to section 6(2) of the CCAA and shall constitute a valid amendment of the Articles pursuant to the OBCA, including pursuant to section 186 of the OBCA. Without limiting the generality of the foregoing, the Company shall file, prior to the Plan Implementation Date, Articles of Reorganization on terms providing that the Articles will become effective, and the Certificate of Amendment will be issued, on the Plan Implementation Date.

5.8 Issuances Free and Clear

Any issuance of any consideration pursuant to the Plan will be free and clear of any Encumbrances.

5.9 Stated Capital

For purposes of the OBCA, the aggregate stated capital of the New Common Shares issued pursuant to the Plan shall be determined by the new board of directors of the Company appointed pursuant to the Plan Sanction Order.

5.10 No Exercise of Right or Remedy

Subject to the performance by the Company of its obligations under the Plan and except as provided in the Plan, all obligations, agreements, contracts or arrangements to which the Company is a party on the Plan Implementation Date shall be and remain in full force and effect, unamended, as at the Plan Implementation Date and no Person, including any party thereto, shall on or following the Plan Implementation Date, accelerate, terminate, refuse to renew, rescind,

- 22 -

refuse to perform, cancel or otherwise disclaim or resiliate its obligations or the Company's interests thereunder, or enforce or exercise (or purport to enforce or exercise) any right or remedy (including any right to receive any change of control, assignment or similar payment) under or in respect thereof by reason:

(a) of any event that occurred prior to the Plan Implementation Date;

(b) that the Company is or was insolvent, or that the Company sought or obtained relief or took steps as part of the Plan or under the CCAA;

( c) of any default, event of default or circumstance of non-compliance arising as a result of the financial condition or insolvency of the Company or the CCAA Proceeding;

( d) of the effect upon the Company of the completion of any of the transactions approved in the CCAA Proceeding or contemplated by the Plan, including, without limitation, as a result of a change of control of the Company; or

( e) of any compromises, settlements, restructurings, recapitalizations or reorganizations effected pursuant to the Plan, including, without limitation, the compromise of the Claim of any Person with respect to a Retained Agreement ( as defined in the Transaction Agreement).

6.1 Plan Releases

ARTICLE6 RELEASES

On the Plan Implementation Date, in accordance with the sequence set forth in section 5.5, the Company, the Company' present and former employees and contractors, the Directors and Officers, the Company Advisors, the Directors' Advisors, the Monitor, the Monitor's counsel, the Sponsor and the Sponsor Advisors and each and every present and former shareholder, affiliate, subsidiary, director, officer, partner, employee, auditor, financial advisor, legal counsel and agent of any of the foregoing Persons referred to in this section 6.1 ( each of such Persons referred to in this section 6.1, in their capacity as such, being herein referred to individually as a "Released Party" and all referred to collectively as "Released Parties") shall be released and discharged from any and all Released Claims, and all Released Claims shall be deemed to be fully, finally, irrevocably and forever waived, discharged, released, cancelled and barred as against the Released Parties, all to the fullest extent permitted by Applicable Law, provided that nothing herein will waive, discharge, release, cancel or bar (a) the right to enforce the Company' obligations under the Plan, (b) the Company from or in respect of any Unaffected Claim or any Claim that is not permitted to be released pursuant to section 19(2) of the CCAA or ( c) any Director or Officer from any Director/Officer Claim that is not permitted to be released pursuant to section 5.1(2) of the CCAA.

6.2 Limitation on Insured Claims

Notwithstanding anything to the contrary in section 6.1 and 6.3, Insured Claims shall not be compromised, released, discharged, cancelled or barred by the Plan, provided that from and after

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the Plan Implementation Date, any Person having an Insured Claim shall be irrevocably limited to recovery in respect of such Insured Claim solely from the proceeds of the applicable Insurance Policies, and Persons with an Insured Claim shall have no right to, and shall not, directly or indirectly, seek any recoveries in respect thereof from the Company, any Director or Officer or any other Released Party, other than enforcing such Person's rights to be paid by the applicable insurer(s) from the proceeds of the applicable Insurance Policies.

6.3 Injunctions

All Persons are permanently and forever barred, estopped, stayed and enjoined, on and after the Effective Time, with respect to any and all Released Claims, from (i) commencing, conducting or continuing in any manner, directly or indirectly, any action, suits, demands or other proceedings of any nature or kind whatsoever (including, without limitation, any proceeding in a judicial, arbitral, administrative or other forum) against any of the Released Parties; (ii) enforcing, levying, attaching, collecting or otherwise recovering or enforcing by any manner or means, directly or indirectly, any judgment, award, decree or order against any of the Released Parties or their property; (iii) creating, perfecting, asserting or otherwise enforcing, directly or indirectly, any lien or encumbrance of any kind against the Released Parties or their property; or (iv) taking any actions to interfere with the implementation or consummation of the Plan; provided, however, that the foregoing shall not apply to the enforcement of any obligations under the Plan.

For greater certainty, the provisions of this section 6.3 shall apply to Insured Claims in the same manner as Released Claims, except to the extent that the rights of such Persons to pursue such Insured Claims against an insurer in respect of an Insurance Policy are expressly preserved pursuant to section 3.4(c) and section 6.2, and provided further that, notwithstanding the restrictions on making a claim that are set forth in sections 3.4(c) and 6.2, any claimant in respect of an Insured Claim that was duly filed with the Monitor by the Claims Bar Date shall be permitted to pursue the litigation in respect thereof to the extent necessary solely for the purpose of preserving such claimant's ability to pursue such Insured Claim against an insurer in respect of an Insurance Policy in the manner authorized pursuant to section 3 .4( c) and section 6.2.

ARTICLE 7 COURT SANCTION

7.1 Application for Sanction Order

If the Required Majority of the Affected Unsecured Creditors in the Unsecured Creditors Class approves the Plan, the Company shall apply for the Sanction Order on or before the date required pursuant to the Transaction Agreement.

7.2 Sanction Order

Subject to Section 7.1 hereof, the Company shall seek a Sanction Order that, among other things:

(a) declares that (i) the Plan has been approved by the Required Majority of Affected Unsecured Creditors in the Unsecured Creditors Class in conformity with the CCAA; (ii) the activities of the Company have been in reasonable compliance with the provisions of the CCAA and the Orders of the Court made in this CCAA

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Proceeding in all respects; (iii) the Court is satisfied that the Company has not done or purported to do anything that is not authorized by the CCAA; and (iv) the Plan, the Restructuring and the transactions contemplated thereby are fair and reasonable;

(b) declares that as of the Effective Time, the Plan and all associated steps, compromises, transactions, arrangements, releases and reorganizations effected thereby are approved pursuant to section 6 of the CCAA, and are binding and effective as herein set out upon and with respect to the Company, all Affected Creditors, the Directors and Officers, any Person with a Director/Officer Claim, any Person with an Equity Claim, the Released Parties and all other Persons named or referred to in or subject to Plan;

( c) declares that the steps to be taken and the compromises and releases to be effective on the Plan Implementation Date are deemed to occur and be effected in the sequential order contemplated by section 5.5 on the Plan Implementation Date, beginning at the Effective Time;

( d) declares that all obligations, agreements, contracts or arrangements to which the Company is a party on the Plan Implementation Date shall be and remain in full force and effect, unamended, as at the Plan Implementation Date and prohibits the exercise by any Person of any right or remedy that is prohibited pursuant to section 5.10;

( e) authorizes and gives effect to the transfer of the Transferred Assets to AssetCo pursuant to section 5 .3;

(f) authorizes the Monitor to perform its functions and fulfil its obligations under the Plan to facilitate the implementation of the Plan;

(g) subject to payment of any amounts secured thereby, declares that each of the Charges shall be terminated, discharged and released upon a filing of the Monitor of a certificate confirming the termination of the CCAA Proceedings;

(h) declares that the Company and the Monitor may apply to the Court for advice and direction in respect of any matters arising from or under the Plan; and

(i) declares that the Persons to be appointed to the boards of directors of the Company on the Plan Implementation Date shall be the Persons named on a certificate to be filed with the Court by the Company on or prior to the Plan Implementation Date.

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ARTICLES CONDITIONS PRECEDENT AND IMPLEMENTATION

8.1 Conditions Precedent in Favour of the Company

The implementation of the Plan shall be conditional upon satisfaction of the following conditions prior to or at the Effective Time, each of which is for the benefit of the Company and may be waived only by the Company:

(a) the conditions precedent in favour of the Company set forth in section 7.2 of the Transaction Agreement shall have been satisfied or waived.

8.2 Conditions Precedent in Favour of the Sponsor

The implementation of the Plan shall be conditional upon satisfaction of the following conditions prior to or at the Effective Time, each of which is for the benefit of the Sponsor and may be waived only by the Sponsor:

(a) the conditions precedent in favour of the Sponsor set forth in section 7.1 of the Transaction Agreement shall have been satisfied or waived;

(b) any and all court-imposed charges on any assets, property or undertaking of the Company (including the Charges) shall have been discharged as at the Effective Time;

( c) all of the Closing Payments shall have been paid by the Company in full;

(d) the New Common Shares, when issued and delivered, shall be duly authorized, validly issued and fully paid and non-assessable and the issuance thereof shall be exempt from all prospectus and registration requirements of Applicable Laws;

(e) the terms of the New Common Shares shall be satisfactory to the Sponsor;

(f) all necessary filings in respect of the alteration of the Articles shall have been made on terms providing that they will become effective and the certificate of amendment will be issued pursuant to section 186 of the OBCA in accordance with and at the times set forth in section 5.5(f), 5.5(g) and 5.5(1); and

(g) the Sponsor shall be satisfied the Transferred Assets have been ( or will be on the Plan Implementation Date) effectively transferred to AssetCo in accordance with section 5.3 hereof.

8.3 Conditions Precedent in Favour of the Company and the Sponsor

The implementation of the Plan shall be conditional upon satisfaction of the following conditions prior to or at the Effective Time, each of which is for the mutual benefit of the Company and the Sponsor and may be waived only by mutual agreement of the Company and the Sponsor:

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(a) the conditions precedent in favour of the Company and the Sponsor in section 7.3 of the Transaction Agreement shall have been satisfied or waived;

(b) the Plan shall have been approved by the Required Majority of the Unsecured Creditors Class;

( c) all orders made and judgments rendered by any competent court of law, and all rulings and decrees of any competent regulatory body, agent or official in relation to the CCAA Proceeding, the Restructuring or the Plan shall be satisfactory to the Sponsor, acting reasonably, including all court orders made in relation to the Restructuring, and without limiting the generality of the foregoing:

(i) the Sanction Order shall have been made on terms acceptable to the Sponsor, acting reasonably, and it shall have become a Final Order; and

(ii) any other Order deemed necessary for the purpose of implementing the Restructuring shall have been made on terms acceptable to the Sponsor, acting reasonably, and any such Order shall have become a Final Order;

( d) all definitive agreements in respect of the Restructuring and the amended Articles, by-laws and other constating documents of the Company, and all definitive legal documentation in connection with all of the foregoing shall be in a form satisfactory to the Company and the Sponsor;

( e) all material agreements, consents and other documents relating to the Restructuring and the Plan shall be in form and in content satisfactory to the Company and the Sponsor, acting reasonably;

(t) all material filings under Applicable Laws shall have been made and any material regulatory consents or approvals that are required in connection with the Restructuring shall have been obtained and, in the case of waiting or suspensory periods, such waiting or suspensory periods shall have expired or been terminated;

(g) there shall not be in effect any preliminary or final decision, order or decree by a Governmental Entity, no application shall have been made to any Governmental Entity, and no action or investigation shall have been announced, threatened or commenced by any Governmental Entity, in consequence of or in connection with the Restructuring or the Plan that restrains, impedes or prohibits ( or could reasonably be expected to restrain, impede or inhibit), the Restructuring or the Plan or any part thereof or requires or could reasonably be expected to require a variation of the Restructuring or the Plan; and

(h) all fees and expenses owing to the Company Advisors, the Directors' Advisors, the Monitor and the Monitor's counsel as of the Plan Implementation Date shall have been paid, and adequate provision shall have been made for all Restructuring Costs, including any fees and expenses of the Company Advisors, the Monitor

- 27 -

and the Monitor's counsel, due or accruing due from and after the Plan Implementation Date.

8.4 Monitor's Certificate

Upon delivery of written notice from the Company Advisors and the Sponsor Advisors of the satisfaction or waiver of the conditions set out in sections 8.1, 8.2 and 8.3, and upon the Monitor being satisfied that adequate provision has been made for all Restructuring Costs, the Monitor shall forthwith deliver to counsel to the Company and the Sponsor a certificate stating that the Plan Implementation Date has occurred and that the Plan is effective in accordance with its terms and the terms of the Sanction Order. As soon as practicable following the Plan Implementation Date, the Monitor shall file such certificate with the Court.

9.1 Binding Effect

ARTICLE9 GENERAL

The Plan will become effective on the Plan Implementation Date. On the Plan Implementation Date:

(a) the treatment of Affected Claims and Released Claims under the Plan shall be final and binding for all purposes and shall be binding upon and enure to the benefit of the Company, the Released Parties, all Affected Creditors, any Person having a Released Claim and all other Persons directly or indirectly named or referred to in or subject to the Plan and their respective heirs, executors, administrators and other legal representatives, successors and assigns;

(b) all Affected Claims shall be forever discharged and released;

( c) all Released Claims shall be forever discharged and released; and

( d) each Affected Creditor and each Person holding a Released Claim shall be deemed to have executed and delivered to the Company and to the Released Parties, as applicable, all consents, releases, assignments and waivers, statutory or otherwise, required to implement and carry out the Plan in its entirety.

9.2 Waiver of Defaults

From and after the Plan Implementation Date, all Persons shall be deemed to have waived any and all defaults of the Company then existing or previously committed by the Company, or caused by the Company, by any of the provisions in the Plan or steps or transactions contemplated in the Plan or the Restructuring, or any non-compliance with any covenant, warranty, representation, term, provision, condition or obligation, expressed or implied, in any contract, instrument, by-law, article, credit document, indenture, note, lease, guarantee or agreement, written or oral, and any and all amendments or supplements thereto, existing between such Person and the Company, and any and all notices of default and demands for payment or any step or proceeding taken or commenced in connection therewith shall be deemed to have been rescinded and of no further force or effect, provided that nothing shall be deemed to excuse

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the Company from performing its obligations under the Plan or be a waiver of defaults by the Company under the Plan and the related documents.

9.3 Deeming Provisions

In the Plan, the deeming provisions are not rebuttable and are conclusive and irrevocable.

9.4 Non-Consummation

Notwithstanding a prior approval given at the Meeting or the granting of the Sanction Order, at any time prior to the Effective Time, if the Transaction Agreement is terminated in accordance with its terms prior to the Plan Implementation Date, then: (a) the Plan shall be null and void in all respects, (b) any settlement or compromise embodied in the Plan and any document or agreement executed pursuant to the Plan shall be deemed null and void, and ( c) nothing contained in the Plan, and no acts taken in preparation for consummation of the Plan, shall (i) constitute or be deemed to constitute a waiver or release of any Claims by or against the Company or any other Person; (ii) prejudice in any manner the rights of the Company or any other Person in any further proceedings involving the Company; or (iii) constitute an admission of any sort by the Company or any other Person. For greater certainty, nothing in this section abrogates, derogates from or otherwise affects the terms of the Transaction Agreement.

9.5 Modification of the Plan

(a) The Company and the Sponsor reserve the right, at any time and from time to time, to amend, modify and/or supplement the Plan, provided that any such amendment, restatement, modification or supplement must be contained in a written document and (i) if made prior to or at the Meeting, is communicated to the Affected Unsecured Creditors attending the Meeting in person or by proxy by notice to the CCAA service list and the posting of the written document on the Monitor's website in respect of the CCAA Proceeding, and (ii) if made following the Meeting, is approved by the Court following notice to the Affected Creditors.

(b) Notwithstanding section 9.5(a), any amendment, restatement, modification or supplement may be made by the Company with the consent of the Sponsor and the Monitor and without further Court Order or approval, provided that it concerns a matter which, in the opinion of the Company, acting reasonably, is of an administrative nature required to better give effect to the implementation of the Plan and the Sanction Order or to cure any errors, omissions or ambiguities and is not materially adverse to the financial or economic interests of the Affected Creditors.

( c) Any amended, restated, modified or supplementary plan or plans of compromise or arrangement filed with the Court and, if required by this section, approved by the Court, shall, for all purposes, be and be deemed to constitute the Plan.

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9.6 Paramountcy

From and after the Effective Time on the Plan Implementation Date, any conflict between:

(a) the Plan or any Order in the CCAA Proceeding; and

(b) the covenants, warranties, representations, terms, conditions, provisions or obligations, expressed or implied, of any contract, mortgage, security agreement, indenture, trust indenture, note, loan agreement, by-law, article, commitment letter, agreement for sale, lease or other agreement, written or oral and any and all amendments or supplements thereto existing between one or more of the Affected Creditors and the Company as at the Plan Implementation Date or the notice of articles, articles or bylaws of the Company at the Plan Implementation Date,

will be deemed, subject to Section 9.4, to be governed by the terms, conditions and provisions of the Plan and the applicable Order, which shall take precedence and priority. Notwithstanding anything to the contrary herein, the Plan shall not alter, modify, supersede or have paramountcy with respect to the Transaction Agreement.

9.7 Severability of Plan Provisions

If, prior to the Sanction Date, any term or provision of the Plan is held by the Court to be invalid, void or unenforceable, the Court, at the request of the Company and with the consent of the Monitor, shall have the power to either (a) sever such term or provision from the balance of the Plan and provide the Company with the option to proceed with the implementation of the balance of the Plan; (b) alter and interpret such term or provision to make it valid or enforceable to the maximum extent practicable, consistent with the original purpose of the term or provision held to be invalid, void or unenforceable, and such term or provision shall then be applicable as altered or interpreted; or ( c) cause the Company to withdraw the Plan. Provided that the Company proceed with the implementation of the Plan, then notwithstanding any such holding, alteration or interpretation, the remainder of the terms and provisions of the Plan shall remain in full force and effect and shall in no way be affected, impaired or invalidated by such holding, alteration or interpretation.

9.8 Responsibilities of the Monitor

PricewaterhouseCoopers Inc. is acting in its capacity as Monitor in the CCAA Proceeding with respect to the Company, the CCAA Proceedings and this Plan and not in its personal or corporate capacity, and will not be responsible or liable for any obligations of the Company under the Plan or otherwise.

9.9 Different Capacities

Persons who are affected by the Plan may be affected in more than one capacity. Unless expressly provided to the contrary herein, a Person will be entitled to participate hereunder in each such capacity. Any action taken by a Person in one capacity will not affect such Person in any other capacity, unless expressly agreed by the Company and the Person in writing or unless its Claims overlap or are otherwise duplicative.

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9.10 Notices

Any notice or other communication to be delivered hereunder must be in writing and reference the Plan and may, subject as hereinafter provided, be made or given by personal delivery, ordinary mail or by electronic transmission addressed to the respective parties as follows:

If to the Company:

GuestLogix Inc. 111 Peter Street, Suite 406 Toronto, Ontario M5V 2Hl

Attention: Email:

with a copy to:

John Gill berry [email protected]

Thornton Grout Finnigan LLP 100 Wellington Street West, Suite 3200 Toronto, Ontario M5K 1K7

Attention: Email:

Robert Thornton and Rebecca Kennedy [email protected] I [email protected]

If to an Affected Creditor, to the mailing address, facsimile address or email address provided on such Affected Creditor's Proof of Claim.

If to the Monitor:

PricewaterhouseCoopers Inc. 18 York Street, Suite 2600 Toronto, ON M5J OB2

Attention: Email

with a copy to:

Greg Prince [email protected]

Norton Rose Fulbright LLP 200 Bay Street, P.O. Box 84 Toronto, ON M5J 2Z4

Attention: Email:

Evan Cobb [email protected]

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If to the Sponsor:

Stornoway Portfolio Management Inc. 30 St. Clair Avenue West Toronto, Ontario M4V 3Al

Attention: Email:

with a copy to:

Scott Reid [email protected]

Goodmans LLP 333 Bay Street, Suite 3400 Toronto, Ontario MSH 2S7

Attention: Email:

Robert J. Chadwick/ Bradley Wiffen [email protected] / [email protected]

or to such other address as any party may from time to time notify the others in accordance with this section. Any such communication so given or made shall be deemed to have been given or made and to have been received on the day of delivery if delivered, or on the day of faxing or sending by other means of recorded electronic communication, provided that such day in either event is a Business Day and the communication is so delivered, faxed or sent before 5 :00 p.m. (Toronto time) on such day; otherwise, such communication shall be deemed to have been given and made and to have been received on the next following Business Day.

9.11 Further Assurances

Each of the Persons directly or indirectly named or referred to in or subject to Plan will execute and deliver all such documents and instruments and do all such acts and things as may be necessary or desirable to carry out the full intent and meaning of the Plan and to give effect to the transactions contemplated herein.

DATED as of the 29th day of July, 2016.

SCHEDULE A

TRANSFERRED ASSETS

1. Any and all shares or equity interests, contingent or otherwise, owned or held by the Company in any subsidiary or affiliate, including, without limitation, all shares or equity interests owned by held by the Company in GuestLogix Asia Pacific Limited, GuestLogix Technologies Limited, GuestLogix USA Inc., and GuestLogix Ireland Limited.

2. Any and all Intercompany Claims (as defined in the Transaction Agreement) that constitute an asset of the Company in existence immediately prior to the Plan Implementation Date.

3. All Benefit Plans and Employee Plans and all assets attributed thereto, to the extent not treated as Retained Assets (as defined in the Transaction Agreement) for purposes of the Transaction Agreement.

4. Any other asset of the Company deemed to be an Excluded Asset (as defined in the Transaction Agreement) in existence immediately prior to the Plan Implementation Date.

EXHIBIT ''B''

Court File No. CV-16-11281-ooCL

ONl'ARIO SUPERIOR COURT OF JUSTICE

COMMERCIAL LIST

IN THE MATIER OF THE COMPANIES' CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED

AND IN THE MAITER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. AND GUESTLOGIX

IRELAND LIMITED (the "Applicants'')

PROOF OF CLAIM

Please read carefully the enclosed Instruction Letter for completing this Proof of Claim fonn. Capitalired terms not defined within this Proof of Claim form shall have the meaning ascribed thereto in the Order of the Superior Court of Justice Commercial List dated April 29, 2016, as may be amended from time to time (the "Claims Procedure Order"). , ' A.

CELINE TACNIERE, on behalf of the Class B Members as that term PARTICULARS OF CLAIMANT: is defined in the pending Fresh as Amended Statement of Claim in

(1) Full Legal Name of Claimant: (include trade name, if different)

Ontario Court File No. CV-16-545118-00CP attached hereto and marked as Ex_hibit "B~ to Annex "A"

The full legal name should be the name of the Claimant of the Applicant(s), notwithstanding whether an assignment of a Claim, or a portion thereof, has occurred.

(2) Full Mailing Address of Claimant:

(3) Telephone Number:

(4) E-mail Address:

(5) Facsimile Number:

(6) Attention (Contact Person):

c/o Morganti Legal

1 Yonge St, Suite 1506 ---··--·- ----

Toronto ON M_5E 1 ~§_

(647) 344-1900 Ext. 4

~tinholt@morgantilega!.co!!L._

(416) 352-7638

Benjamin Tinholt ---·---(7) Has the claim set out herein been sold, transferred or assigned by the Claimant to

another party?

;.JYes ~No

B. PARTICULARS OF ASSIGNEE(S) (IF APPUCABLE)

If the Claim set out herein has been sold, transferred or assigned, complete the required information set out below. If there is more than one assignee, please attach a separate sheet that contains all of the required iriformation set out below for each assignee.

(1) Full Legal Name of Assignee:

(2) Full Mailing Address of the Assignee:


(4) Email Address:

(s) Facsimile Number:


C. PROOF OF CLAIM:

nla

----~--·--

---·-------

TiiE UNDERSIGNED HEREBY CERTIFIFS AS FOLLOWS:

(a) That I: ~ am a Claimant of one or more of the applicants; OR

oarn (state position or title)

of -----· --(name of Claimant)

(b) That I have knowledge of all the circumstances connected with the Claim described and set out below;

(c) The Applicant(s) was and still is indebted to the Claimant as follows (include all Claims that you assert against the Applicant(s). Claims should be filed in the currency of the transaction with an exchange rate as at the Filing Date (with reference to the contractual rate of interest, if any) and such currency should be indicated as provided below in respect of the Claim(s);

Cd) If you are asserting your Claim against the Applicants' Directors or Officers you are required to complete section F of this Proof of Claim Form

I I ?< GuestLogix . Inc.

(i}Amount ofClaim

Out.standing asat

Febniary9, 2016

$ 5 million

(II) Amount of (iii) Total R.estructuring Claim (Sum

Claim of(l)and (ii)

""$ ____ -'----

GuestLogix ~$ _____ $~~~- _$~~~-Ireland Llmited

Unsecured

Note: For the purpose of the Claims Procedure Order only ( and without prejudice to the terms of any plan of arrangement or compromise that may be filed by the Applicant(s)), Claims will be converted to United States dollars at the Bank of Canada noon spot rate as at the Filing Date. The exchange rate conversion on such date was:

n CAD $1.3820 - US$1.oo u GBP - $0.6902 - US$1.oo o EUR - $0.8836 - US$1.oo

D. NATURE OF CLAIM - Complete ONLY if you are asserting a Secured Claim

(CHECK AND COMPLETE APPROPRIATE CATEGORl?

Applicant:

Secured Claim of $ ______________ _

(Original Currency and amount)

In respect of this debt, I hold security over the assets of the Applicant(s) valued at

$ ___________ _, (Original Currency and amount)

the particulars of which security and value are attached to this Proof of Claim form.

Unsecured Claim of $--,----=-----~-------(Original Currency and amount)

Give full particulars of the security, including the date on which the security was given the value which you ascribe to the assets charged by your security, the basis/or such valuation and attach a copy of the security documents evidencing the security.

If you are asserting multiple secured claims, against one or more of the Applicants, please provide.full details of your security against each of the Applicants.

E. PARTICULARS OF CLAIM:

Other than as already set out herein. the particulars of the undersigned's total Claim against the Applicant(s) are attached on a separate sheet. See Annex "A"

Provide all particulars of the Claim and supporting documentation that you/eel will assist in the detennination of your Claim. At a minimum, you are required to provide the invoice date, invoice number, the amount of each outstanding invoice and the related purchase order number. Further particulars may include the following if applicable: a description of the transaction(s) or agreement(s) giving rise to the Claim; contractual rate ofinterest(if applicable); name of any guarantor which has guaranteed the Claim; details of all credits, discounts, etc. claimed; description of the security if any, granted by the affected Applicant(s) to the Claimant, the estimated value of such security and the basis for such valuation; and the particulars of any Restructuring Claim.

F. PROOF OF CLAIM - CLAIM AGAINST THE DIRECTORS AND OFFICER(S)

THIS SECTION SHOULD ONLY BE CQMPLHTED BYA CLAIMANT ASSERTING A CLAIM AGAINST THE DIRECTOR{Sl AND QFFICER{S} OFTHEAPPUCANT(Sl. A CLAIMANT.ASSERTING A CIA.IM QNLYAGAINSTTIIE APPUCANT<Sl SHOULD NOT COMPLETE THIS SECIJQN.

1HE UNDERSIGNED HEREBY CERTIFIFS AS FOLLOWS:

(a) That I:

t>F am a Claimant of one or more of the applicants, OR.

::iam -.,......~----(state position or title)

of --.,.,~·--"·"',-~·-""-""""'-'-----··

(name of Claimant)

(b) I assert a claim against the following Director(s) and Officer(s) (please list below the individual Directors or Officers:

Brett Proud

Patrick Leung ----

(c} That I have knowledge of all the circumstances connected with the Claim described and set out below;

(d) The Director(s) and Officer(s) was and still is indebted to the Claimant as follows in respect of a D&O Prefiling Claim arising prior to February 9, 2016 (claims should be filed in the currency of the transaction):

$ $5 million

(Original Currency)

(e) The Director(s) and Officer(s) was and still is indebted to the Claimant as follows in respect of a D&O Restructuring Claim arising on or after Februaiy 9, 2016 (claims should be filed in the currency of the transactions):

$. _____________ _

(Original Currency)

G. FILING OF CLAIM:

This Proof of Claim form must be returned to and received by the Monitor by no later than

5:00 p.m. (Easteni Time) on June 2, 2016 (the "Prefiling Claims Bar Date"},

unless a Restructuring Claim is being asserted in which case the Proof of Claim fonn related

to your Restructuring Claim only must be received by the Monitor by no later than 5:00

p.m. (Eastern Time) on the date which is the earlier of the Prefiling Claims Bar

Date and 5:00 p.m. (Eastern 'lune) on the day which is 30 days after the date

the Monitor sends a Claims Package with respect to a R.estructuring Claim in

accordance with the Claims Procedure Order (the "Restructuring Claims Bar Date"), by either regular mail, prepaid registered mail, personal delivery, courier, electronic

communication or facsimile transmission at the following address:

PricewaterhouseCoopers Inc., Monitor of Guestl..ogix Inc. and GuestLogix Ireland Limited PwCTower 18 York Street, Suite 2600 Toronto ON MsJ 082

Attention: Tammy Muradova Email: [email protected] Telephone: +1 416 687 8238 Fax: (416) 814-3219

27th M DATED this day of.:::::::;;~ay ___ --=~i=::::.::::=20:.:1=6.

Wi~ EUN !ERE. on s em rs as that term is defined in the

Benjamin D. Tinholt mg Fresh as Amended Statement of Claim in Ontario Court File No.

CV-16-545118-00CP attached hereto and marked as Exhibit "8" to Annex "A"

If Claimant is a Corporation, print name and title of authorized signatory:

1'-lame=~~~~~~~~~~~~~

Title:

Note: After signing this form, please ensure you retu.m all pages of this Proof of Claim to the Monitor.



COMMERCIAL LIST


AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. and GUESTLOGIX IRELAND LIMITED.

(the "Applicants")

AFFIDAVIT OF CELINE TACNIERE

ANNEX "A" TO PROOF OF CLAIM OF CELINE TACNIEREAND THE PUTATIVE CLASS MEMBERS IN THE CLASS PROCEEDING ENTITLED CELINE TACNIERE V.

GUESTLOGIX INC., ET AL., CV-16-545118-00CP

I, CELINE T ACNIERE, of the City of Halifax, in the Province of Nova Scotia, MAKE

OATH AND SAY AS FOLLOWS:

I. I am a retail investor that invested in Guestlogix Inc. ("Guestlogix"). I purchased 20,000

shares of Guestlogix on September 2, 2014.

2. I have personal knowledge of the facts to which I hereinafter depose, except where stated

to be on information and belief, in which case I disclose the source of my information. I

believe that the facts deposed to herein are true.

3. On January 25, 2016, Celine Tacniere commenced an action in the Ontario Superior Court

of Justice (File No. CV-I 6-545118) against Guestlogix and others (the "Tacniere Action")

alleging that, during the period from March 24, 2014 to and including November 12, 2015

(the "Class Period"), Guestlogix and others published documents and made statements

about the Company's business, finances and operations that contained misrepresentations.

-2-

Attached as Exhibit"A" to this Affidavit is a copy of the statement of claim in the Tacniere

Action.

4. The Tacniere Action is a proposed class proceeding which advances claims pursuant to

Part XXIII of the Ontario Securities Act claims on behalf of the plaintiff and on behalf of

all similarly situated investors who purchased shares of Guestlogix during the Class Period.

5. I am advised by Andrew Morganti and Benjamin Tinholt, the lead lawyers for the plaintiffs

in the Tacniere Action, that Guestlogix has applied to this Court for protection under the

Companies' Creditors Arrangement Act ("CCAA") and that the Tacniere Action has been

stayed as against Guestlogix (the "CCAA stay").

6. I am also advised by Andrew Morganti that, as soon as possible following the lifting of the

CCAA stay, the plaintiffs in the Tacniere Action will issue a fresh as amended statement

of claim (the "Fresh as Amended Claim"). Mr. Morganti has advised me that the statutory

secondary market claims (i.e. "purchasers' claims") advanced in the Fresh as Amended

Claim will proceed on the basis of a revised class period of June 8, 2015 to November 12,

2015. The purchasers' claims are defined as "Class A" in the Fresh as Amended Claim.

7. Additionally, Mr. Morganti has advised me that the Fresh as Amended Claim will also

assert common law secondary market claims on behalf of investors who purchased

Guestlogix's securities prior to June 8, 2015, and who held their securities after November

12, 2015 (i.e. "holders' claims"), defined as "Class B" in the Fresh as Amended Claim. I

understand that I am member of the proposed Class B.

8. Attached as Exhibit "8" to this Affidavit is a copy of the Fresh as Amended Claim.

SWORN before me at the City of Toronto, in the Province of Ontario, this 27th day of May, 2016.

issioner for taking Affidavits for Ontario

8enJamln D. Tlnholt

... - ., -

Tl .. E h'b' 'i1 ,,fned ' h 11S IS X I tt.,~·····- to 1n t e ·rd · r /I~ 1.,·v,p t1t1A;ere a, 1 avtt o ... S/.1:. ···- - ..... .

sworn before me. this - •. .!::!.!:. ................ . day of. ... J1.'7 ............ 20./l ..

B ETW EE N.

Court File No.:

ONTARIO SUPERJOR COURT OF JUSTICE

CELINE T ACNIF.RE,

Plaintiff and

c :Ol~STLOGIX INC., BRETT PROUD, PATRICK LEUNG, and NATIONAL BANK FINANCIAL, INC.,

Proceeding under the Cla.\w Proceedings Act, 1992

STATEMENT 011' CLAIM

TO TIIE DEFENDANTS:

Defendants

A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the plaintiff. The claim made against you is set out in the following pages.

JF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Fom1 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiffs lawyers or, where the plaintiff does not have a lawyer, serve it on the plaintiff. and file it, with proof of service in this court office, WJTHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.

If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is fony days. If you arc served outqide Canada and the United States of America, the period is sixty days.

Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Form 188 prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within which to serve and file your statement of defence.

IF YOU FAJL TO DEFEND THJS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL ArD MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE.

IF YOU PAY THE PLAINTIFF'S CLAfM, and $5,000.00 for costs, within the time for serving and filing your statement of defence you may move to have this proceeding dismissed by the court. If you believe the amount claimed for costs is excessive, you may pay the plaintiff's claim and $400.00 for costs and have the costs assessed by the court.

TAKE NOTICE: THIS ACTION WJLL AUTOMATICALLY BE DISMISSED ifit has not been set down for trial or terminated by any means within five years after the action was commenced unless otherwise ordered by the court.

Date:

TO: GUESTLOGIX INC 111 Peter Street, Suite 302 Toronto, ON M5V 2H I

AND TO: BRETT PROUD 111 Peter Street, Suite 302 Toronto, ON M5V 2Hl (Last known address and place of employment)

AND TO: PATRICK LEUNG 111 Peter Street, Suite 302 Toronto, ON M5V 2HI

AND TO: NATIONAL BANK FINANCIAL, INC. 130 King Street Wesl, Suite 3200 Toronto, ON MSX IJ9

Issued by:

Local Registrar . Address o/CourirJJt,ce:·

393 University Avenue, 10111 Floor Toronto, ON M5G 1 E6

2

DEFINED TERMS

I. In addition to the terms defined in :;s. I (I) and J 38.1 of the Securities Ac,, R.S.O. I 99U, c.

S. 5, and elsewhere herein. the following tenus used throughout this Statement of C'la1m have the

mi:a11ings indtcated bdow:

{al "AIF'' meam A11nual l11formauon hmn. u~ detined in NI 51-102:

(b) "Class'' or "Class Members" meuns all persons, other than Excluded Pcrs,ms,

who acquired Gucstlogi x 's securities during the Class Period and who held some

or all of those securities at the dose of trading on November J 2, 2015;

(c) "Class Pea·iod" means the period from and including March 14, 2014 to and

mduding Nuvembcr 12, 2015;

(d) ··Corn•ctive Disclosures'' meaw, the infonniilion concerning < ium,tlogix \;

business, linances, and operations published on November I 2 and Dccernhcr I 6,

2015;

(CJ "CJA" means thc Courts of Justice Act, R.S.O_ J 990, c. C.43, ai-. amended;

( I) "Company" mca11s Gucstlogix;

(g} "CPA" m1s;ans the Class l'roceedings Act, IYY2, S.(l 1992, c. 6, as amended,

(h) "CSA" m1;.:1nh rhe Canadian Set:unlies A<lmrnistrators:

( i) "EBITDA" means ..:arnings before interest, taxes, depreciation, and amorti1:atio11;

a finam.;1al ratio for measuring a compi:ny'h opt:rating pcrfonna11cc a11d

profitability;

3

(j) "Equivalent Securities Act" means, collectively, the Sccul'itit:s Act, R.S.A. 2000,

c. S-4, as amended; the Securities Ac:t, R.S.B.C J 996, c 418, as amc.:ndcd~ The

Securities Act, C.C.S.M. c. S50, as amended~ the Securities A<-'f, S.N.B. 2004, c.

S-5.5, as amended; the Securities Act, R.S.N .L. 1990, c S-13, as amended; the

Securities Act, S.N.W.T. 2008, c. 10, as amend1.1d; the Securities Act, R.S.N.S.

1989, c. 418, as amended; the Securities Act, S Nu 200g, c. 12, a:; amended: the

SPt'urities A,·t, R.S.P.E.l. 1988, c S-3.1, as amended; the Securities Act, R.S.Q. t·

V-l.l, as ammded; The Securities Act, /988, S.S. 1988-89, c. S-42.2, a:;

amended; and the Securities Act, S.Y. 2007, c. 16, as amended:

(k) "Excluded Persons'' means Guestlogix·s subsidiaries, affiliates, officers,

directors, senior employees, legal representatives. heirs, predecessors. succcssurs

and assigns, and any member of the Lndivi<lual Defendants' families and any

~11tity in which any of them has or had during the Class Period any legal or de

/£11:to rnmrolling interest;

(I) "GAAP" means Gencrnlly Accepted Accounting Principles in Cunada;

(m) ··Individual Defendants" means Proud and Leung;

111) ·'MD&A .. means Managi:mcnl's Discussion and Analysis, as defined 111 NI SI

I 02. Under Nl 51-102, a MD&A is required to be on Form 51-102F I, and is a

uarrntiw explanation, through the eyes of management, of how a reporting issuer

perfonncd during the period covered by the financial statements, and of tht:

reporting issuer's financial condition and future prospects;

4

(oJ ''NBF" means National Bunk Financial Inc.;

(p) "NI 51-102" means the CSA 's National Instrument 51-102 - Con1inuous

Disclosure Obligations, as amended;

(q) "NJ 52-l09" means the CSA's National Instrument 52-109 -- Certification ~,f

Oisdosure m Jssu\:!rs· Annual and lntenm Filings, us amended;

(r) '·CucsOogix" mea11s Defon<lant Guestlogi>.., Inc.;

(s) .. OSA" means the Secunties Act. R.S.O. 1990 c. S.5, us amended:

(t) ··Plaintiff' means Celine Tacnierc;

( u) "Prospectus" means Gucstlogix 's final short fonn prospectus published on

SEDAR on December 17, 2014, which was associated with the Company's

December 22, 2014, public oflering of 20 million subscription receipts, $20

million wnvcrtiblc unsecured subordinated debentur~s. and a private plat:ement

of I 0,4 79,000 suhsctiption receipts;

( v) "'SF.DAR'' means the CSA 's System for Electronic Document Analysis and

Hctricval; and

( w) ''TSX" means the Toronto Stock Exchange.

5

Rl~IH.F <'LAl!\HW

::!. The Plaintiff claims on her own behalf and on behalf or the other Class Members:

(a) An order ecrtifying this action as a class proceeding and appointing her as the

representative plaintiff for the Class, pursuant to s. 5 of the CPA;

(b) A declaration that uuring the Class Period the Defendants made material

misrepresentations related to the Company's business, operations and finances, as

provided in Gncstlogix's core documents, including within its Prospectus;

(c) A declaration that NBF made a misrepresentation by omitting material foc.:ts about

certain financial covenants associated with Uuestlogix's December 22. 201J

rcvolvmg credit facility m the Prospectus, which were not con-ected, in whok ur

in part, until November 12, 20 J 5;

(d) With respect to those class members who acquired Guestlogix's securities in the

seconda1y market, an order granting leave to pursue the causes of action st>t out in

P11rt XXHl. l of the ().')~4 and the comparable provisions in the Equ1vaknt

Securities Ac;ts us against Gucstlogix and the Individual Defendants eflec11vc to

the date this action was commence.d:

tc) With respect to those class members who acquired Gucstlogix's stcunties in the

secondary market, an order granting leave to pmsue the causes of action set out in

Part XXIII.l, Section I 3X.3( I )(e) of the OSA und the comparable provisions in the

Equivillt:nt Securities Aets as against NBF effective to the date Ibis n<.:lmu was

..:om me need;

(f) A dedaration that the Defendants made these misrepresentations negligently or

knowingly, pending the evidence;

(g) A dedaration that the D~fondnnts foiled 10 make full, true, and plain disclosure in

the Company's Prospectus;

(h) A declaration that the Defendants breached s. 56 of the OSA and the rnmparahle

provisions m the Equivalent Sccurilie!-: Acts;

(i) A declaration that Defendants breached s. 75 of the OSA and the comparahle

provisions in the Equivalent Securities Acts;

(j) A declaration that Guestlogix is vicariously liable for the acts and omissions of

the Individual Defendants;

(k) Statutory secondary market damages in the sum of $5 million plu::; common law

and statutory primary market damages in an amount in excess of $20 millino or

such other sum as this Court finds appropriate at the trial of the common issues or

at a reference or references;

(l) An order directing a reference or giving such other directions as may be necessary

to detennine issucb not detcm1ined in the trial of the common issues:

(m) Prejudgment and post-judgment interest, compounded, or pursuant 10 ss. 128 and

129 of the CJA;

7

( 11) Costs of this action on a full indemnity scale, or in an amount that provides

substantial indemnity plus, pursuant to s. 26(9) of the CPA, the costs of

atlministcring the plan of distribution of the recovery in this action: and

( o) Such forth er and other relief as this Honourabk ( \nut deems just.

NATURE of·Tms ACTION

J. This securities dass m:tion relates lo the Defondauts publishing core documc111s a1Hl

making other statements during the Class Period, mcluding in the Company· s fiuam:ial

statements, containing nmlcrial misrepresentations because they omitted material facts about

vario11:-. litwncial covenants attached to lwo (2) diflcrcnl credit facilities. Additionally,

Uuestlogix has annoum:ed that it will restate its prior financial statements due to material

accounting errors.

4. The Plaintiff alleges that Guestiogix securities' value and price was artificially inflated as

a result of the Defendants publishing core documents and making ornl statements contai111ng

misreprcst:ntations of material foct.

S. On Novcml>er 12. 2016, Guestlogix announced that it was in default of two i1) s,parate

financial covenants corresponding lo a revolving credit facility ( entered into December 23. ?OD)

and a subordinated term i.;redit facility (entered into June 5. 2015) because it had breached a

trailing EBITDA covcnam. As a result of the br<::ach, both credit facilities t'ould become due on

demand by the lender, the long-term subordinated tcnn credit facility becam1:: reclassified to

current. a11tl the mtercst rntc 011 the prmt:ipal amount ul' that credit facihty rost.: from I 2'!··o to 1:-~'h>.

(>. (,uc:,;tJogix nevc1 disclosed thm there were financial eovcnants cont.iincd within these

credit focilitics linked to a trailing EBITDA or that the interest rate for the term credit fhciliry

would incrcusr to 18':·,1. This news immediately caused Gucstlogix securities' perceived value

aud pri.:c to drop more than 54'}~, from $0.47 to $0.215 per share.

7. On December J 6, 2015. Gucsllogix announced that an internal review of irn prior

accounting practice:,; and rC"vcnue recognition policies concluded that it may be required h)

restate its prior financial statements and that the preliminary review indicated that the

rcstatcmcm would be material. This news 1mmcdiatcly caused Guestlogix securitic~· pcn.:civcd

value and price to drop 43% from $0.21 to $0.12 per share.

THF. PLAINTIFF

8. Cel inc Tacnierc is an individual who resides in the City of Halifax, in the Province of

Nov:1 Scotia. On September 2, 2014, the Plaintiff purchased. 20,000 Guestlogix sccuriliC"s and

realized :i loss by holding those securities until after the Corrective Disclosures.

THE DEFENDANTS

9 CiuL·stlogix is an Ontario incorporated and operated company that i:; engaged in the

provision oftransnclion-bascd onboard retail software solutions for the passenger travd indus1ry.

JO. During the Class Period, Guestlogix'H securities were publicly traded and were listed on

,md traded under lhe ticker symbol "GXJ" on thl! TSX with a CUSIP identifier numbcr 40l(dP.

There is also a11 owr the-counter marke1 for Guestlogix 's set:urities in the Uuiieti Stales ,md OJl

the F ra11k fun Stock ExchangL'.

l I. Uucstlogix is a reporting issuer in Rritish Columbia, Alberta, Saska!chcw:m, Manitoba,

Outario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland.

Gucstlogix is also a "responsible issuer" as defined in s. 138. l of the OSA and the compawble

provisions in the Equivalent Securities Acts.

12. The OSC is Guestlogix's princi1>al securities regulator in Canada. In connr:ction with itf.

continuous disclosure obligationi;, Gucstlogix files documents on SEDAR m Canada.

13. Pursuant to NI 51-/02, as a reporting issuer in Ontario, Gucstlogix was required

throughout lhe Class Period to, inter a!ia, issue and file with SEDAR:

(a) Within 10 days of the date on which a material change occurred, a makrial

dangc report on Fom1 51-102F3 with respect to the material change aud a press

release forthwith;

(b} Withm 45 days of the end of each quarter. quarterly interim financial statements

containing all !he mate1fol facts that arose during the quarter:

(c) Within 90 days of the end of the fiscal year, annual financial statements;

(d) Contemporaneously with each of the above, a MD&A of each of the above

financial i,tall:tucnl,;; and

(c) Within 90 days of the end of its fo;cal y~ar, an Alf, including material

mformation about the company and its business at a point in time in the context of

its historical and futurl' operations.

IO

14. Bretl Prnud was Gucsllogix's former President and Chief Executive Officer during the

Class Period until Scpttmber 16, 2015, when he resigned effectively unmediatcly. During 2014,

Proud's total cornpem,ation was $614,907. Proud made writlen and oral misrcprcscntat1ons to

investors Juring the Class Period, as particularized herein.

15. Patrick Leung was finesllogix's Chief Financial Otliccr during rhe Class Period. During

2014, Lcung·s total compensation was $156,681. !Jc made written and oral misrepre:.entations

to investors during the Class Period, as pa11icuJarizcd herein.

16. Nat1unal Bank Financial Inc., served as GuesHogix ·s lead underwriter for ib December

22, 2014 public olforing of subscription receipts and debentures.

THE FOUNDA TJON AND MATRRIAL EVENTS

17. On December 2.\ 2013. Guesllogix entered into a USD $4 million revolving credit

facility wilh a Canadian chartered bank. The Company's announcements did not <lisdosi.: the

matenal focts about the financial covenants contained within the revolving credit facility.

18. 011 March 24, 2014, Guestlogix published ns audited annual financial statcmems. AH·,

and MD&A for fiscal 2013. These core documents did not disclose the mutcrial fa<:!:> about tlw

financial covenants contained within the revolving credit facility besides for the requirement that

it must maintain a $1 million balance with the lender and have a tangible net worth of $2.6

million. Specifically, there was no disclosure that there were trailing EBITDA ratio

requirc1m:111s. Judividual Ddendants Proud and Leung certified that there wi.:rc no

misrepresc11ta1wns. These certifkations were incorrect b<:t:aust· of the rcuson:; identified in 1hc

Corrc.x:tiw Disclosures.

I l

!9. On May 12, 2014, Guestlogix published its QI 2014 financial re!-:ults and MD&A. These

eorc documents did not disclose the material focts about the financial covenanls contained within

th<.· rcv~)lving credit facility. Individual Dcfondant~ Proud .ind Lcu11g certified tha! there wen: no

mi~repn:se111aLio11s. rhc~c ccrtifkatium; wcrn incorrect because of the reasons idcnlilied in the

Cuncc1ivc Disclosures.

'..'W. On August I I, 2014. Gucstlogix published its Q2 2014 financial results and MD&A.

These core documents did not disclose the material facts about the financial coveuants contained

within the revolving credit facility and subordinated term credit facility. Individual Ddemlmlls

Proud and Leung certified th,tt there were no misrepresentations. These certifications were

im:om:ct because oftht: reasons identified in the Con·ective Disclosures.

2 I. On November '.\, 20 I 4, Gucstlogix published its Q3 2014 financial results and MD&A.

Thcsi:. core document8 did not disclose the material facts about the financial covenants co11ta111ed

within the revolving credit facility and subordiuatcd tenn credit facility. Individual Delendauts

Proud and Leung cc11ified that there were no misrepresentations. These certifications wen:

im:orrcct because of the reasons identified in the Corrective Disclosures.

22. On December I 7, 2014, Guestlogix published its Prospectus, with the consent of NFB,

fi.>r it~ 20 million subscription receipt ($0.95 each) and a $20 million 7% convertible uns1:cu1ed

subordinated debenture ($1,000 foce value per debenture). This core document did not disclose

the malerial facts about the financial covenants contained within the revolving credit facility.

Individual Defendants Proud and Leung ct:nified that there were no misrcprcscntatwm,. These

cer1ilica1ions were incon-ect bt:cause of the reasons identified in tht l'om:1.:t1ve D1sch>surcs.

12

23. With re~pect to the December 22, 2014 public offering, NBr and the syndicate

underwriters earned $0.05 per subi;cription receipt and $45 per debenture in underwriting foes.

NBF and the syndicate underwriters also certified that there were no misrepresentations. These

certitkations were incom:et because. of the reasons identified Hl the Co1Tcctivc Disclosures.

'.24 On Decembt'r 22, 2014, Gu~sllogix with the assistanc-: of N.FB and Lhl.' sy11dira1c

underwriter:; closed the public and private offering of subscription receipts and debentures.

25. On December 23, 2014, Gucstlogix acquired 100% of the outstanding shares of OpcnJaw

Tcclmologies Limitcd ('OpcnJaw'), an Ireland-based provider of high periom1ancc t-Rctail

Platform, e-commerce and distribution solutions to airlines, onlim: travel agencies, hotel group!.

and loyalty ma1lcting companies for USD$41.2 million.

26. On March 16, 2015, Guestlogix published its audited annual financial slatemcu!s, AIF,

and M D&A for fiscal 2014. These core documents revealed that the Comp.my "was III breach of

a ce11ain financial covenant under the tenns of the revolving credit facility" and that the hnnk had

agreed to :111 amendment of the covenant. but did not disclose the material facts about the

financial covenants or the amcndment(s). Individual Defendants Proud and Leung certified that

thert' were no misrepresentations. These certifications were incorrect because of the rea'>ons

identified in the Correclive Disclosures.

27. On May 4, 2015, Guestlogix published its QI financial results and MD&A. These core

docum~nts did not disdose lhc material facts about the financial covenants contained within the

rcvolvtog credit facility. ln<livi<luaJ Defendants Proud and Leung certified that there were no

misrepresentations. Tht:se certifications were incorrect because of the reason:,; ideulilied u1 the

CotTec..:tive Disclosures.

13

28. 011 June 5, 2015 Gucstlogix entered into ,1 subordinatt~d term credit facility with a

principal ,unount of USD $7.2 n1illio11 (CAD $9 million) plus associated warrants with o

syndicate of lenders. The Company's announcement did not disclose the material facts about tht:

!i11andal rnvt:na111s contajned within this term credit facility, nor did they disclose 1har tht'. stated

I 2'!ii interest rate would inc.:rem:e to 18% were the Company to tlcfoult on this credit facility.

29. 011 Juuc 22, :?.015, Ciucstlogix t)bt11i11cd an amendment horn the bank to incrt'asc the

revolving credit facility from USD $4 million to USD $7.5 million. The company di<l nut issue.:

any mmo111H:cment conkmporancously disclosing the im;rcase in the credit facility, uor did it

disclose the mukrial facts about the financial covenants comained within the r,.-:v,)lving credit

facility .

. W. On August 12. 2015, Gucstlogix published its 02 financial results and MD&A. These

core documents did 1101 disclose the material facts about the financial covenants co11ta1m.'J within

the revolving credit facili1y and subordinated term credit facility. Individual Ddcuda11ts Proud

aud Lc1111g ceriific<l that there were no misrepresentations. They also represcmed that it was their

opinion that existing cash flow and access ro financing provided Gucstlogix with -,utlk1cnt

n:sourcL:s lt1 finance ongoing business requirements for the near term. These certifications w,:n.·

in.:orrect because of the reasons identified in the Corrective Disclosures.

31. On September 16, 2015, Guestlogix published a material change report that lmlivi<lual

Defondant Proud was ahruptly retiring as CEO and director of the Company. No olhcr material

facts nbolll his departure were disclosed.

32. 011 Nov(!mber 12, 2015, Guesllogix published its Q3 financial results ua<l M D&A.

Gw.:sllog1x annoum;cd that as al Scpternbcr 30, 20 I 5, it was 111 breach of twn (2) separnlt'

14

financial covenants eorrcsponding to the revolving credi1 facility (entered into December 2J,

20D) aud subordinated lcrm credit facility (emered into June 5, 2015) bccnuse it had breached

the trailing EBITDA covenants. It further revealed that a result of the breaches, the tenders could

i111mcdi,udy call both loans. the suhordinateJ knn credit facility was being rncla:-;siticd from

Jong-1erm to current debt, and the interest rate on the subordinated term credit facility wse from

33. Tim Corrective Disclosure 1mm0diatcly caused Guestlogix securities' perceived vuluc

and pnce to drop more than 54•:,.~ from $0.47 to $0.2 I 5 per share.

34. Ou December J6, 2015, Guesllogix announced that its new CEO hud initi:ited an mtemal

review of its prior accounting practices and revenue recognition policies. The review determined

that Gucstlogix may he required to restate its prior linancial statements and that the prd11n11inry

review indicated that the restatement would be material. This news immediately causeJ

Guestlogix securitiei;' pcrcc:ived valui: and price to drop 43% from $0.21 to $0.12 pt!r share.

NO STATUTORY DEFJ<:NCE FOR l•ORWARD-LOOKJNG INFORMATION

3 ".. To the extent that any of the disclosure documents or public statements addressed in this

Stalt'mcnt of Claim contained foxward-looking mfonnation. some of those forward-Juokmg

statements constituted misrep,·esentations because the Det'«!ndunts had no reasonable basis fi.w the

underlying assumptions on which this forward-looking information wa::. based for th,; r~asons

particularized above.

36. further or in the alternative, to th\! extent that the statutory defences of sections J:12. l .ind

J Jg_4 do apply to any forward-looking statements pleaded hcn:in, Gucstlogix and the l11dividu:.il

l 'i

Defendants are liable for those forward-looking statements containing the alleged

misrepresentations because at the time each of those forward-looking statements was made,

Gucstlogix ,md the Individual Defon<lauts knew or should have known that the particular

forward-looking statements were misrepresentations for the reasons alleged herein.

37. To the extent tlwt the statutory defences of section I 3R.4 do apply to any forward-looking

statements in the core document pleaded herein, the Defendants are liable for those forward

looking s~temcnts containing the alleged misrepresentations because at the time that the

Prospectus was cc1iilied, the Defendants knew or should have known that the particular forward

looking statements were misrepresentations for the reasons alleged herein.

THE CAUSF.S OF ACTION ASSERTEJ) BY THE PLAINTIFF AND CLASS

38. The Plaintiff asserts, in her personal and a representative capacity, primary market

statutory causes of action against Defendant Guestlogix and Individual Defendants, and NBF

fount.I at section 130(l)(a)- (d) of the OSA and the Equivalent Securities Acts.

39. The Plaintiff asserts, in her personal and a representative capacity, secondary marke1

statutrny causes of action against Defendant Guestlogix and Individual Defendants found a1

St'Ctions 138.3( I )(a) - (c). J3!).3(2}(a) - ( c ), and section 138.3(4) of the OSA and the L:quivalent

Securities Acts.

40. The Plaintiff asserts, in her personal and in a representative cap.icily, :secondary market

statutory causes of action against NBF found at section 138.3( I )(e) of the OSA a11<l the

Equivalent Securities Act$.

I 6

THE tU:LATIONSHIP BETWEEN THE MISREPRESENTATIONS AND THE PRICE AND VALCE OF GUESTLOGIX'S SF.ClJRITIES

41. The price and value of Guestlogix's securities were directly affected each time that

Uues!logix and the Individual Defendants communicated new material changes and material

fil<.:ts about Guestlogix 's business, finances, and operations. including Guestlogix 's acquisitmns,

accounting policies, revenue recognition policies, future revenue prospects, revenue growth

p~rcentagcs, compensation of insiders and management, and the number of Guestlogix 's issued

and outstanding shares.

42 Guestlogix and the Individual Defondanls were aware at all matt:rial times of the cffec1 of

Guestlogix 's disclosures about its business, fiuan('.CS, and operations, including Guestlogix 's

acquisitions, accountin~ policies, revenue recognition policies, fi.1turc revenue prospects, revenue

growth pcrcentnges, compensation of insiders and management, and the number ofliucstlogi,;.'s

issued and outstanding shares, on the price of the Company's publicly traded securities.

Gut'sllogix intended that the Class Members, including the Plaintitl: would rely upon these

disclrn,ures, which they did to their dcn·imcnt.

43. The disclosure documents referred to herein were filed with SEDAR and thereby became

11rnnedia1ely availabk to and were reproduced for inspection for the benefit of the Plaintiff and

the other Cluss Members, tht: public, financial analysts and th~ financial press through the

Internet and financial publications.

44. Gucstlogix routinely transmitted the documents rcforrcd to herein to the financial pn:s1,,

financial analysts and certain prospective and existing shareholders of the Company.

17

45. Gucstlogix regularly communicated with public investors and financial analysts via

established market communication mechanisms, including through regular dissl'mination of

news releases on newswire services and through tclcconfrrl.!nccs with investors and analysts.

46. Guestlogix was the subject of analysts' reports that incorporated the information iu the

disclosure documents referred to herein. with the effect thut nny recommendation in such reports

during the Class Period were based, in whole or in part, upon 1hc news releases, interim and

annual filings, and statements mndc during the investor conference calls, which contained

misrepresentations.

47. During the Class Period, Guestlogix's securities were lraded on the TSX (and other

alternative trading pla1forms in Gcnnany and the United Stales), which is a highly efficient and

automated market. The pncc at which Gucstlogix's securities traded on thl' TSX incorporated

the information in th!.! disclosure documents referred to herein, including information about

Guestlogix 's acquisitions. accounting policies, revenue recognition policies, futun: revenue

prospects, revenue growth percentages, compensation of insiders aod management. and the

number ofGuestlogix's issued and outstanding shares.

THE VICAIUOllS LIABILITY OF GUESTLOGIX INC.

48. The acts partku!arizcd and alleged in this Statement of Claim to have been done hy

Guestlogix were authorized, ordered and done by the Individual Defendants :1s well as other

officers. agcnls, employees and reprcscnlativcs who were engaged in the management. <lireclion,

control and transaction of Guestlogix's business, finances, and operations and arc, lh~rcforc, acts

and omission~ for which Guestlogix is vicariously habit.

PART xxm.1 OF THE OSA

49. On behalf of the Plaintiff and those class members who purchased Guestlogix 's

securities, the Plaintiff will bring a motion seeking leave to amend this Statement of Cla11n,

pursuant to s. 138.8(1) of the OSA to: (a) assert the causes of action set out in s. 138.3 of the OSA

against Guestlogix amt tht: Individual Ocfondaots; and (b) assert the cause of action set out in s.

i38.3(l)(e) of the OSA against NBF.

DAMAGES

50. As a result of the conduct of the Dcfondants as alleged, the Plaintiff and each other Class

Member suffered losses and damages as a result of acquiring Guestlogix · s securities at

artificially inflated prii;cs on or after March 24, 2014, and holding some or all of those securities

after November J 2, 2015. Thci:eforc, the Defendants arc liable to pay damages to the Plaintiff

and the other Class Members.

51. The Plaintiff and the other Class Members are also entitled to recover as damages, or

costs in accordance with the CPA. the costs of administering the plan to distribute the recovery in

this action.

RRAL AND SUBSTANTIAL CONNECTION WITH ONTARIO

52. This action has a real and substantial connection with Onturio because. among other

things:

(a) Defendant Guestlogix is a reporting issuer in Ontario;

(b) Defendant National Bank Financial. Inc. 1s located within Ontario;

19

1.:) Class Members n.:siden1 Ill Onruno ;icquircd Guc:-;tlogix shares and sufft>red

damage a11d loss. and

(JJ !he slwn;:, of Guestlog1x trade on the TSX, wh1d1 is located m Onlano.

RELEVANT LEGISLATION

)_L Tl1c Plaintiff plead~ and relies upon the ('./,1, the CPA, NI 33 10.'i. NI 43 WI. Nl 4..f /In,

NI 51-10:!. the OSA, and the Equivalent Securities Acts.

PLACE OF TRIAL

'.'i l. Thl' Plamtiff rroroscs that the c~rtilfo<l co111111u11 issues be tried in the City lll To1on10

January 25. 2016

MORGANTI LEGAL Lawy1'.r:-. l 69 I\ ing Street East, J"1 Fluor Torouto, ON MSA IJ4

Andrew .J. Morganti (LSlJCII 57X951· i Tel: (647) 344-1900 fax: (41<,) 800-2171

Lawyer for the Plaintiff

;

CELINE TACNIERE Plaintiff

v. GUESTLOGIX INC., et al Defendants

Court File No.


J PROCEEDINGS COJ\AMENCED AT TORONl

i l

STATEMENT OF CLAJM

MORGANTI LEGAL Lawyers 169 King Street East, 3rd Floor Toronto, ON M5A IJ4

Andrew J. Morganti LSUC# 57895E Tel: (647) 344-1900 [email protected]

Lawyers for Plaintiff

,, ,, This is Exhibit,;1'J. ..... -re~ tojn the

affidavit of .CiJ£c,:r.: ........ l.lUJ4.LI£!. ... . sworn be~ me, this ... 2 .. ,:1.. ........... .,. .. day of..... ~-························· 20 . .lo

8enJamln D. Tlnholt

BETWEEN:

Court File No.: CV-16-545118-00CP


ALEX M. BODNARCHUK and CELINE TACNIERE

Plaintiffs and

GUESTLOGIX INC., BRETT PROUD, and PATRICK LEUNG

Defendants

Proceeding under the Class Proceedings Act, 1992

FRESH AS AMENDED STATEMENT OF CLAIM (Statement of Claim Issued January 25, 2016)

TO THE DEFENDANTS:


IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Form 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiffs lawyers or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and fiJe it, with proof of service in this court office, WITHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.

If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is forty days. If you are served outside Canada and the United States of America, the period is sixty days.

Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Form l 8B prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within which to serve and file your statement of defence.

IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONT ACTING A LOCAL LEGAL AID OFFICE.

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IF YOU PAY THE PLAINTIFF'S CLAIM, and $5,000.00 for costs, within the time for serving and filing your statement of defence you may move to have this proceeding dismissed by the court. If you believe the amount claimed for costs is excessive, you may pay the plaintiffs claim and $400.00 for costs and have the costs assessed by the court.

TAKE NOTICE: THIS ACTION WILL AUTOMATICALLY BE DISMISSED if it has not been set down for trial or terminated by any means within five years after the action was commenced unless otherwise ordered by the court.

Date: Issued by: ________ _ Local Registrar

Address of Court Office:

393 University A venue 101h Floor Toronto ON MSG lE6

TO: OSLER, HOSKIN, & HARCOURT LLP 100 King Street West t First Canadian Place Suite 6200, P.O. Box 50 Toronto ON M5X 1 B8

Kevin O'Brien Tel: 416-862-4861 E-mail: [email protected]

Lawyers for the Defendants Guestlogix Inc. and Patrick Leung

AND TO: STOCKWOODS LLP BARRISTERS TD North Tower 77 King Street West Suite 4130, P.O. Box 140 Toronto ON M5K IHI

Andrea Gonsalves Tel: 416-593-7200 E-mail: [email protected]

Lawyers for the Defendant Brett Proud

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DEFINED TERMS

1. In addition to the terms defined in ss. 1 ( 1) and 138.1 of the Securities Act, R.S.O. 1990, c.

S. 5, and elsewhere herein, the following terms used throughout this Fresh as Amended Statement

of Claim have the meanings indicated below:

(a) "AIF" means Annual Information Form, as defined in NI 51-102;

(b) "Bodnarchuk" means Alex. M. Bodnarchuk;

(c) "CJA" means the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended;

(d) "Class A" or "Class A Members" means all persons, other than Exc1uded Persons,

who acquired Guestlogix's securities on or after June 8, 2015 and who held some

or all of those securities at the dose of trading on November 12, 2015;

( e) "Class B" or "Class B Members" means all persons, other than Exc1uded Persons,

who acquired Guestlogix's securities prior to June 8, 2015, and who held some or

all of those securities at the close of trading on June 8, 2015;

(t) "Class Members" means, collectively, the Class A Members and Class B

Members;

(g) "Class Period" means the period from and including June 8, 2015 to and including

November 12, 2015;

(h) "Comerica" means Comerica Bank, a subsidiary of Comerica Inc.;

(i) "Comerica Credit Facility" means the credit facility granted by Comerica to

Guestlogix on December 23, 2013, and subsequently amended on June 22, 2015;

-4-

(j) "Company" means Guestlogix Inc.;

(k) "Corrective Disclosure" means the core documents published by Guestlogix on

November 12, 2015, and the Company's related disclosures concerning its breaches

of the Comerica Credit Facility and Vistara Credit Facility;

(I) "CPA" means the Class Proceedings Act, 1992, S.O. 1992, c. 6, as amended;

(m) "Credit Facilities" means, collectively, the Comerica Credit Facility and Vistara

Credit Facility.

(n) "CSA" means the Canadian Securities Administrators;

(o) "CUSIP" means the Committee on Uniform Security Identification Procedures;

(p) "EBITDA" means earnings before interest, taxes, depreciation, and amortization;

a financial ratio for measuring a company's operating performance and

profitability;

(q) "Equivalent Securities Act" means, collectively, the Securities Act, R.S.A. 2000,

c. S-4, as amended; the Securities Act, R.S.B.C. 1996, c 418, as amended; The

Securities Act, C.C.S.M. c. SSO, as amended; the Securities Act, S.N.B. 2004, c. S-

5.5, as amended; the Securities Act, R.S.N.L. 1990, c S-13, as amended; the

Securities Act, S.N.W.T. 2008, c. 10, as amended; the Securities Act, R.S.N.S.

1989, c. 418, as amended; the Securities Act, S Nu 2008, c. 12, as amended; the

Securities Act, R.S.P.E.l. 1988, c S-3.1, as amended; the Securities Act, R.S.Q. c

- 5 -

V-1.1, as amended; The Securities Act, 1988, S.S. 1988-89, c. S-42.2, as amended;

and the Securities Act, S.Y. 2007, c. 16, as amended;

(r) "Excluded Persons" means Guestlogix's subsidiaries, affiliates, officers, directors,

senior employees, legal representatives, heirs, predecessors, successors and

assigns, and any member of the Individual Defendants' families and any entity in

which any of them has or had during the Class Period any legal or de facto

controlling interest;

(s) "GAAP" means GeneraJiy Accepted Accounting Principles in Canada;

(t) "Guesdogix" means Guestlogix Inc.;

(u) "Individual Defendants" means, collectively, Brett Proud and Patrick Leung;

(v) "Leung" means Patrick Leung;

(w) "MD&A" means Management's Discussion and Analysis, as defined in NI 51-102.

Under NI 51-102, a MD&A is required to be on Form 51-102F I, and is a narrative

explanation, through the eyes of management, of how a reporting issuer performed

during the period covered by the financial statements, and of the reporting issuer's

financial condition and future prospects;

(x) "NI 51-102" means the CSA's National Instrument 51-102-Continuous


(y) "NI 52-109" means the CSA's National Instrument 52-109---·Certification of

Disclosure in Issuers' Annual and Interim Filings, as amended;

-6-

(z) .. Guestlogix" means Guestlogix Inc.;

(aa) "OSA" means the Securities Act, R.S.0. 1990 c. S.5, as amended;

(bb) ·'Plaintiffs" means, collectively, Tacniere and Bodnarchuk;

(cc) 0 Proud" means Brett Proud;

(dd) "SEDAR" means the CSA's System for Electronic Document Analysis and

Retrieval;

( ee) "Tacniere" means Celine Tacniere;

(ff) "TSX" means the Toronto Stock Exchange;

(gg) "Vistara" means, collectively, Vistara Fund I GP Inc. and Beedie Capital Partners

Inc.; and

(hh) "Vistara Credit Facility" means the credit facility granted by Vistara to

Guestlogix on May 25, 2015, which was made public on June 8, 2015.

RELIEF CLAIMED

2. The Plaintiffs claim on their own behalf and on behalf of the respective Class Members:

(a) An order pursuant to s. 5 of the CPA certifying this action as a class proceeding.

appointing Alex M. Bodnarchuk as the representative plaintiff for Class A, and

appointing Celine Tacniere as the representative plaintiff for Class B;

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(b) With respect to Class A, an order granting leave to pursue the statutory causes of

action set out in Part XXIII. l of the OSA and the comparable provisions in the

Equivalent Securities Acts effective to the date this action was commenced;

(c) A declaration that during the Class Period Guestlogix and the Individual

Defendants made material misrepresentations related to the Company's business,

operations and finances, as provided in Guestlogix's core documents;

(d) A declaration that the Defendants made these misrepresentations negligently or


(e) A declaration that Defendants breached s. 75 of the OSA and the comparable


(f) A declaration that Guestlogix is vicariously liable for the acts and omissions of the

Individual Defendants;

(g) Statutory and common law_secondary market damages in the sum of $5 million or



(h) An order directing a reference or giving such other directions as may be necessary

to determine issues not determined in the trial of the common issues;

(i) Prejudgment and post-judgment interest, compounded, or pursuant to ss. 128 and

129 of the CJA;

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(j) Costs of this action on a full indemnity scale, or in an amount that provides

substantial indemnity, plus, pursuant to s. 26(9) of the CPA, the costs of

administering the plan of distribution of the recovery in this action; and

(k) Such further and other relief as this Honourable Court deems just.

NATURE OF THIS ACTION

3. This securities class action relates to the Defendants publishing core documents and

making other statements during the Class Period, including in the Company's financial statements,

which contained material misrepresentations by omitting material facts about credit facilities, and

amendments thereto, entered into by Guestlogix. The action comprises two claims:

(a) a statutory claim for secondary market misrepresentation pursuant to Part XXill of

the OSA on behalf of those plaintiffs who purchased shares of Guestlogix during

the Class Period (i.e. Class A); and

(b) a common law holders' claim for secondary market misrepresentation on behalf of

those plaintiffs who held shares of Guestlogix at the time of the misrepresentation.

(i.e. Class B).

4. The Plaintiffs allege that Guestlogix's securities' value and price were artificially inflated

as a result of the Defendants publishing core documents and which omitted material facts about

unusual and restrictive financial covenants which were part of the Credit Facilities.

5. On November 12, 2015, Guestlogix announced that it was in breach of two (2) separate

financial covenants in respect of the Vistara Credit Facility and the Comerica Credit Facility. The

-9-

breaches were caused by Guestlogix's failure to meet certain trailing EBITDA covenants as

particularized below. As a result of these breaches, inter alia, both credit facilities could become

due on demand by the lenders; the Vistara Credit Facility was reclassified from long-term to

current; and the interest rate on the principal amount of Vistara Credit Facility was increased from

12% to 18%.

6. Guest]ogix never disclosed that the Credit Facilities contained financial covenants linked

to trailing EBITDA requirements; that default on the Vistara Credit Facility would trigger a default

on the Comerica Credit Facility, or that default on the Vistara Credit Facility would trigger an

interest rate increase from 12% to 18%. With the publication of the Corrective Disclosure on

November 12, 2015, news of the default immediately caused Guestlogix securities' perceived

value and price to drop more than 54% from $0.47 to $0.215 per share.

7. On December 16, 2015, Guestlogix announced that it had carried out an internal review of

its prior accounting practices and revenue recognition policies and concluded that it may be

required to restate its prior financial statements and that the preliminary review indicated that the

restatement would be material. This news caused Guestlogix securities' perceived value and price

to drop 43% from $0.21 to $0.12 per share.

THE PLAINTIFFS

8. Alex M. Bodnarchuk is an individual who resides in the City of Regina Beach, in the

Province of Saskatchewan. On October 22, 2015, he purchased 2,000 Guestlogix securities and

realized a loss by holding these securities until after the November 12, 20 I 5 Corrective Disclosure.

- IO-

9. Celine Tacniere is an individual who resides in the City of Halifax, in the Province of Nova

Scotia. On September 2, 2014, she purchased 20,000 Guestlogix securities and realized a loss by

holding those securities until after June 8, 2015.

THE DEFENDANTS

I 0. Guestlogix is an Ontario incorporated and operated company that is engaged in the

provision of transaction-based onboard retail software solutions for the passenger travel industry.

I I. During and prior to the Class Period, Guestlogix' s securities were publicly traded and were

listed on and traded under the ticker symbol "GXI" on the TSX with a CUSIP identifier number

40163P. There is also an over-the-counter market for Guestlogix's securities in the United States

and on the Frankfurt Stock Exchange.

12. Guestlogix is a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba,

Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland.

Guestlogix is also a "responsible issuer" as defined in s. 138.1 of the OSA and the comparable


13. The OSC is Guestlogix's principal securities regulator in Canada. In connection with its

continuous disclosure obligations, Guestlogix files documents on SEDAR in Canada.

14. Pursuant to NI 51-102, as a reporting issuer in Ontario, Guestlogix was required throughout

the Class Period to, inter alia, issue and file with SEDAR:

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(a) within 10 days of the date on which a material change occurred, a material change

report on Form 51-102F3 with respect to the material change and a press release

forthwith;

(b) within 45 days of the end of each quarter, quarterly interim financial statements

containing all the material facts that arose during the quarter;

(c) within 90 days of the end of the fiscal year, annual financial statements;

(d) contemporaneously with each of the above, a MD&A of each of the above financial

statements; and

(e) within 90 days of the end of its fiscal year, an AIF, including material information

about the company and its business at a point in time in the context of its historical

and future operations.

15. Brett Proud was Guestlogix's President and Chief Executive Officer prior to and during

the Class Period until his resignation from those positions on September 16, 2015. During 2014,

Proud's total compensation was $614,907. Proud made written and oral misrepresentations to

investors during the Class Period, as particularized herein.

16. Patrick Leung was Guestlogix's Chief Financial Officer during the Class Period. During

2014, Leung' s total compensation was $356,681. He made written and oral misrepresentations to


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THE FOUNDATION AND MATERIAL EVENTS

17. On December 23, 2013, Guestlogix entered into the Comerica Credit Facility, which

provided the Company with USO $4 million in revolving credit.

18. On March 16, 2015, Guestlogix published its audited annual financial statements, AIF, and

MD&A for fiscal 2014. These core documents revealed that the Company "was in breach of a

certain financial covenant under the terms of the revolving credit facility" (i.e. the Comerica Credit

Facility) and that the bank had agreed to an amendment of the covenant. However, these core

documents but did not disclose the material facts about the financial covenant, its breach, or the

amendment(s). Individual Defendants Proud and Leung certified that the documents published on

March 16, 2015 contained no misrepresentations.

19. On April 27, 2015, Comerica sent a proposal to Guestlogix in respect of the Comerica

Credit Facility. In addition to a credit increase, the proposal included a new minimum trailing six

month EBITDA requirement, as set out in Part VIII of the Discussion Term Sheet:

Borrower, to maintain on a monthly basis, unless otherwise noted: [ ... ]

4) (NEW) Minimum Trailing Six Month EBITDA as follows: From Closing: negative $2,500,000 May 31, 2015: negative $2,000,000 June 30, 2015: 0 (zero) October 31, 2015 and thereafter: $1,000,000

5) (NEW) Maximum Trailing Six Month Capitalized Software Development Costs as follows:

From closing: After December 31, 2015:

$3,500,000 $3,250,000

6) (NEW) Maximum Trailing Six Month Capitalized Expenditures as follows: From closing: $1,500,000 After December 31, 2015: $750,000

- 13 ~

20. On May 4, 2015, Guestlogix published its Ql financial results and MD&A. These core

documents did not disclose the material facts about the financial covenants contained in the

amendments to the Comerica Credit Facility. Individual Defendants Proud and Leung certified

that these documents contained no misrepresentations.

21. On May 25, 2015 Guestlogix entered into the Vistara Credit Facility, which was a

subordinated term credit facility with a principal amount of USD $7.2 million (CAD $9 million)

plus associated warrants. Section 8.4(b) of the Vistara Credit Facility provided that the Company

must maintain a minimum EBITDA requirement. Specifically, section 8.4(b) stated that

Guestlogix must:

[m)aintain minimum EBITDA calculated on a consolidated basis for the Borrower of not less than

( 1) US $2,000,000 for the Fiscal Quarter ending June 30, 20 I 5; (2) US $3,000,000 for the Fiscal Quarter ending September 30, 2015; and (3) US $3,600,000 for each two Fiscal Quarter period ending December 31,

2015, March 31, 206 and for each Fiscal Quarter thereafter;

Measured at the end of each such Fiscal Quarter for the six month fiscal period comprised of such Fiscal Quarter and the immediately preceding Fiscal Quarter(.)

22. Further, the terms of the Vistara Credit Facility provided that, in the event of default, the

interest rate of 12% would increase to 18%.

23. On June 8, 2015, Guestlogix published a press release announcing the closing of the Vistara

Credit Facility. The press release did not disclose the material facts about the financial covenants

contained in the Vistara Credit Facility, nor did Guestlogix disclose that the stated 12% interest

rate would increase to 18% were the Company to default on the Vistara Credit Facility.

- 14 -

24. By failing to disclose the material facts of the financial covenants attached to the Vistara

Credit Facility, the Defendants made a misrepresentation which distorted the Company's market

price and the value of its securities, which therefore became artificially inflated.

25. Bodnarchuk and the Class A Members purchased Guestlogix's securities without the

benefit of the knowledge of the above material facts. Tacniere and the Class B Members read and

relied upon Guestlogix's documents which contained the misrepresentation in continuing to hold

Guestlogix 's securities.

26. On June 22, 2015, Guestlogix obtained an amendment from Comerica whereby the

maximum principal of the Comerica Credit Facility was increased from USD $4 million to USD

$7 .5 million. Guestlogix did not issue any announcement contemporaneously disclosing this

amendment, nor did it disclose the material facts· about the financial covenants contained in the

Comerica Credit Facility.

27. By failing to disclose the material facts of the financial covenants attached to the Comerica



28. Bodnarchuk and the Class A Members purchased Guestlogix securities without the benefit

of the knowledge of the above material facts. Tacniere and the Class B Members read and relied

upon Guestlogix' s documents which contained the misrepresentation in continuing to hold

Guestlogix 's securities.

29. On August 12, 2015, Guestlogix published its Q2 financial results and MD&A. These core

documents did not disclose the material facts about the financial covenants contained within the

- 15 -

Vistara Credit Facility and the Vistara Credit Facility. Individual Defendants Proud and Leung

certified that these documents contained no misrepresentations.

30. On September 16, 2015, Guestlogix published a Form 51-102F3-Material Change Report

announcing that Proud was abruptly resigning as CEO and director of the Company. No other

material facts about his departure were disclosed.

31. On November 12, 2015, Guestlogix published its Q3 financial results and MD&A, which

disclosed that as at September 30, 2015, it Guestlogix was in breach of two (2) separate financial

covenants corresponding to the Vistara Credit Facility and the Comerica Credit Facility, and that

these breaches were caused by failure to comply with the trailing EBITDA covenants. Guestlogix

further revealed that as a result of these breaches, the lenders could immediately call both Joans,

the Vistara Credit Facility had been reclassified from Jong-term to current debt, and the interest

rate on the Vistara Credit Facility had increased from 12% to 18%.

32. This Corrective Disclosure immediately caused Guestlogix securities' perceived value and

price to drop more than 54% from $0.47 to $0.215 per share.

33. On December 16, 2015, Guestlogix announced that its new CEO had initiated an internal


that Guestlogix may be required to restate its prior financial statements and that the preliminary

review indicated that the restatement would be material. This news immediately caused Guestlogix

securities' perceived value and price to drop 43% from $0.21 to $0. 12 per share.

- 16-

NO STATUTORY DEFENCE FOR FORWARD-LOOKING INFORMATION

34. To the extent that any of the disclosure documents or public statements addressed in this

Fresh as Amended Statement of Claim contained forward-looking information, some of those

forward-looking statements constituted misrepresentations because the Defendants had no

reasonable basis for the underlying assumptions on which this forward-looking information was

based for the reasons particularized above.

35. Further or in the alternative, to the extent that the statutory defences in sections 132.1 and

138.4 of the OSA do apply to any forward-looking statements pleaded herein, the Defendants are

liable for those forward-looking statements containing the alleged misrepresentations because, at

the time each of those forward-looking statements was made, the Defendants knew or should have

known that the particular forward-looking statements were misrepresentations for the reasons

alleged herein.

THE CAUSES OF ACTION ASSERTED BY THE PLAINTIFF AND CLASS

36. Bodnarchuk asserts, in his personal capacity and on behalf of Class A, secondary market

statutory causes of action contained in_sections 138.3(l)(a) - (c), 138.3(2)(a) - (c), and 138.3(4)

of the OSA and the Equivalent Securities Acts.

37. Tacniere asserts, in her personal capacity and on behalf of Class B, secondary market

common law causes of action. Specifically, she asserts, in her personal capacity and on behalf of

Class B, that had the Defendants not published misrepresentations about the financial covenants

attached to the Credit Facilities on June 8 and June 22, 2015, she would have known all the material

- 17 -

facts about Guestlogix's business, operations and capital structure, and, as a result, she would have

made a decision to sell her Guestlogix securities.

THE RELATIONSHIP BETWEEN THE MISREPRESENTATIONS AND THE PRICE AND VALUE OF GUESTLOGIX'S SECURITIES

38. The price and value of Guestlogix's securities were directly affected each time that the

Defendants disclosed material changes and material facts about Guestlogix' s business, finances,

and operations, including Guestlogix's acquisitions, accounting policies, revenue recognition

policies, future revenue prospects, revenue growth percentages, compensation of insiders and

management, and the number of Guestlogix's issued and outstanding shares.

39. The Defendants were aware at all material times of the effect of Guestlogix's disclosures

about its business, finances, and operations, including Guestlogix's acquisitions, accounting

policies, revenue recognition policies, future revenue prospects, revenue growth percentages,

compensation of insiders and management, and the number of Guestlogix' s issued and outstanding

shares, on the price of the Company's publicly traded securities. Guestlogix intended that the Class

Members, including the Plaintiffs, would rely upon these disclosures, which they did to their

detriment.


immediately available to and were reproduced for inspection for the benefit of the Plaintiffs and

the other Class Members, the public, financial analysts and the financial press through the Internet

and financial publications.

41. Guestlogix routinely transmitted the documents referred to herein to the financial press,


- 18 -

42. Guestlogix regularly communicated with public investors and financial analysts via

established market communication mechanisms, including through regular dissemination of news

releases on newswire services and through teleconferences with investors and analysts.

43. Guestlogix was the subject of analysts' reports that incorporated the information in the

disclosure documents referred to herein, with the effect that any recommendation in such reports

during the Class Period were based, in whole or in part, upon the news releases, interim and annual

filings, and statements made during the investor conference calls, which contained

misrepresentations.

44. During the Class Period, Guestlogix's securities were traded on the TSX (and other

alternative trading platforms in Germany and the United States), which is a highly efficient and

automated market. The price at which Guestlogix's securities traded on the TSX incorporated the

information in the disclosure documents referred to herein, including information about

Guestlogix's acquisitions, accounting policies, revenue recognition policies, future revenue

prospects, revenue growth percentages, compensation of insiders and management, and the

number of Guestlogix 's issued and outstanding shares.

THE VICARIOUS LIABILITY OF GUESTLOGIX INC.

45. The acts particularized and a11eged in this Fresh as Amended Statement of Claim to have

been done by Guestlogix were authorized, ordered and done by the Individual Defendants as well

as other officers, agents, employees and representatives who were engaged in the management,

direction, control and transaction of Guestlogix's business, finances, and operations and are,

therefore, acts and omissions for which Guestlogix is vicariously liable.

- 19 -

STATUTORY SECONDARY MARKET LIABILITY -PART XXIll.l OF THE OSA

46. The Plaintiff will seek leave under s. 138.8( 1) of the OSA to assert the causes of action set

out in Part XXlll. l of the OSA against the Defendants, and to treat the multiple misrepresentations

particularized herein as a single misrepresentation, pursuant to 138.3(6) of the OSA.

DAMAGES

47. As a result of the conduct of the Defendants as alleged, Bodnarchuk and each other Class

A Member suffered losses and damages as a result of acquiring Guestlogix's securities at

artificially inflated prices on or after June 8, 2015, and holding some or all of those securities after

November 12, 2015. Therefore, the Defendants are liable to pay damages pursuant toss. 138.1,

138.5, and 138.7(2) of the OSA, to Bodnarchuk and to the other Class A Members.

48. Bodnarchuk and the other Class A Members are also entitled to recover as damages, or

costs in accordance with the CPA, the costs of administering the plan to distribute the recovery in

this action.

49. As a result of the conduct of the Defendants as alleged, Tacniere and each other Class B

Member suffered losses and damages as a result of acquiring Guestlogix's securities prior June 8,

2015, and holding some or a1I of those securities after June 8, 2015. Therefore, the Defendants are

liable to pay damages, pursuant to the common law, to Tacniere and to the other Class B Members.

REAL AND SUBSTANTIAL CONNECTION WITH ONTARIO

50. This action has a real and substantial connection with Ontario because, among other things:

(a) Guestlogix is a reporting issuer in Ontario;

-20-

(b) Class Members who are resident in Ontario acquired Guestlogix shares and suffered

damage and loss in Ontario; and

(c) the shares of Guestlogix trade on the TSX, which is located in Ontario.


51. The Plaintiffs plead and reJy upon the CJA, the CPA. NI 51-102. NI 52-109, the OSA. and

the Equivalent Securities Acts.

May 24, 2016

MORGANTI LEGAL Lawyers One Yonge Street, Suite 1506 Toronto, ON M5E 1E5

Andrew J. Morganti (LSUC# 57895E) Tel: (647) 344-1900 E-mail: [email protected]

Lawyers for the Plaintiff

BODNARCHUK, et al. v. GUESTOGIX INC., et al.

Plaintiffs Defendants

Court File No. CV-16-545118-00CP


PROCEEDINGS COMMENCED AT TORONTO

FRESH AS AMENDED STATEMENT OF CLAIM

MORGANTI LEGAL Lawyers One Yonge Street, Suite 1506 Toronto, ON M5E IE5

Andrew J. Morganti (LSUC# 57895E) Tel: (647) 344-1900 Ext. 1 E-mail: [email protected]


EXHIBIT ''C''


ONI'ARIO SUPERIOR COURT OF JUSTICE

COMMERCIAL LI.ST


AND IN THE MATI'ER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. AND GUESIT.OGIX


PROOF OF CLAIM

Please read carefully the enclosed Instruction Letter for completing this Proof of Claim form. Capitali7.ed terms not defined within this Proof of Claim form shall have the meaning ascribed thereto in the Order of the Superior Court of Justice Commercial List dated April 29, 2016, as may be amended from time to time (the "Claims Procedure Order").

A. PARTICULARS OF CLAIMANT:


ALEX M. BODNARCHUK, on behalf of the Class A Members as that term is defined in the pending Fresh as Amended Statement of Claim in Ontario Court File No. CV-16-545118-00CP attachedhereto !_ng marked as Exhibit "B" to Annex "A"




(4) E-mail Address:



c/o Morganti Legal

1 Yonge St, Suite 1506 ---Toronto ON MSE 1 ES

{647) 344-1900 Ext. 4 -~-.. Q!inholt.@morgantil~aJ.com _

(416) 352-7638 ----·---·-

Benjamin Tinhol.t

(7) Has the claim set out herein been sold, transferred or assigned by the Claimant to another party?

uYes rXNo


If the Claim set out herein has been sold, transferred or assigned, complete the required iriformation set out below. If there is more than one assignee, please attach a separate sheet that contains all of the required iriformation set out below for each assignee.


(2) Full MaHing Address of the Assignee:


(4) Email Address:

Cs) Facsimile Number:


C. PROOF OF CLAIM:

nla

TIIE UNDERSIGNED HER.EBY CERTIFIES AS FOU..OWS:

(a) That I: ~ am a Claimant of one or more of the applicants; ()R

---··------(state position or title)

of (name of Claimant)


(c) The Applicant(s) was and still is indebted to the Claimant as follows (include all Claims that you usert against the Applicant(s). Claims should be filed in the cu1Tency of the transaction with an exchange rate as at the Filing Date (with reference to the contractual rate of interest, if any) and such currency should be indicated as provided below in respect of the Claim(s);

{d) If you are asserting your Claim against the Applicants' Directors or Officers you are required to complete section F of this Proof of Claim Form

[)_(

Applicant(•)

Guestl.ogix Inc.

GuestLogix Ireland Limited

(i)Amount ofClaim.

Outstanding aaat

Pebmary9, 2016

$ Smillion

s

(ii) Amount of (iii) Total Restructuring Claim (Sum

Clahn of (I) and (ii)

I ~

i ~

-------------------~·-·------

Secured Uwiecured

Note: For the purpose of the Claims Procedure Order only (and without prejudice to the terms of any plan of arrangement or compromise that may be filed by the Applicant(s)), Claims will be converted to United States dollars at the Bank of Canada noon spot rate as at the Filing Date. The exchange rate conversion on such date was:

n CAD $1.3820 - US$1.oo i:.:: GBP - $0.6902 - US$1.oo o EUR - $0.8836 - US$1.oo

D. NATUlt.E OF CLAIM - Complete ONLY if you are asserting a Secured Claim

(CHECK AND COMPLETEAPPROPRIATECA7EGOR1?

Applicant:




$ __________ _, (Original Currency and amount)


Unsecured Claim of $ _____________ _


Give.full particulars of the security, including the date on which the security was given the value which you ascribe to the assets charged by your security, the basis/or such valuation and attach a copy of the security documents evidencing the security.

If you are asserting multiple secured claims, against one or more of the Applicants, please provide full details of your security against each of the Applicants.

E. PARTICULAKSOFCLAIM:

Other than as already set out herein, the particulars of the undersigned's total Claim against the Applicant(s) are attached on a separate sheet. See Annex "A"

Provide all particulars of the Claim and su.pJ)Orting documentation that you feel will assist in the determination of your Claim. At a minimum, you are required to provide the invoice date, invoice number, the amount of each outstanding invoice and the related purchase order nwnber. Further particulars may include the following if applicable: a description of the tronsaction(s) or agreement( s) giving rise to the Claim; contractual rate of interest (if applicable); name of any guarantor which has guaranteed the Claim; details of all credits, discounts, etc. claimed; description of the security if any, granted by the affectedApplicant(s) to the Claimant, the estimated value of such security and the basis for such valuation; and the particulars of any Restructuring Claim.

F. PROOF OF Cl.AIM - CLAIM AGAINST THE DlllECfORS AND OFFICER(S)

THIS SECTION SHOULD ONLY BE COMPLETED BYA CLAIMANTASSER,TING A CLAIM AGAINST THE DIRECTOR(Sl AND OFFICER{Sl OF TIIEAPPUCANT(S}. A CLAIMANTASSERTJNGA CL.AIM QNLYAGAINSTTHE APPIJCANT{S) SHOULD NOT COMPLETE THIS SECI]ON.

THE UNDERSIGNED HEREBY CERTIFIFS AS FOLLOWS:

(a) That I:

/f am a Claimant of one or more of the applicants, QR.

:, am ---(state position or title)



Brett Proud

Patrick Leung ------· ---···----

(c} That I have knowledge of all the circumstances connected with the Claim described and set out below;


$ $5 million

(Original Currency)

(e) The Director(s) and Officer(s) was and still is indebted to the Claimant as follows in respect of a D&O Restructuring Claim arising on or after February 9, 2016 (claims should be filed in the currency of the transactions):

$ ______________ _

(Original Currency)

G. FILING OF CLAIM:


5:00 p.m. (Eastem Time) on June 2, 2016 (the "Preftling Claims Bar Date"),

unless a Restructuring Claim is being asserted in which case the Proof of Claim form related



Date and 5:00 p.m. (Eastern Time) on the day which is 30 days after the date

the Monitor sends a Claims Package with respect to a llestructuring Claim in accordance with the Claims Procedure Order (the "Restructuring Claims Bar

Date"), by either regular mail, prepaid registered mail, personal delivery, courier, electronic


PricewaterhouseCoopers Inc., Monitor of GuestLogix Inc. and Guestl.ogix Ireland Limited PwCTower 18 York Street, Suite 2600 Toronto ON MsJ 082

Attention: Tammy Muradova Email: [email protected] Telephone: +1 416 687 8238 Fax: {416) 814-3219

,,, r/-{ DATEDthis L,"::> dayof_M_a_Y ______ __.2016

qz~~) Per. :;;L.9---.S) Witness Name: (Sigfiature)

Benjamin D. Tinholt If Claimant is a Corporation, print name and title of authorized signatory:

N Alex Bodnarchuk ame:

R"""'e-p-re_se_n...,.ta'""'t,..iv-e =p,....,a ... in..,tiff .... o....,f'""C,....la_s_s ... A_a_s =th-a-nenn

T'tl . is defined in the pending Fresh as Amended Statement of Claim in 1 e. Court File Ho. CV-16 5-45118 OOGP etteehed hereto and marked as

Exhibit "B" to Annex "A"

Note: After signing this form, please ensure you return all pages of this Proof of Claim to the Monitor.



COMMERCIAL LIST



(the "Applicants")

AFFIDAVIT OF ALEX M. BODNARCHUK

ANNEX "A" TO PROOF OF CLAIM OF ALEX M. BODNARCHUK AND THE PUTATIVE CLASS MEMBERS IN THE CLASS PROCEEDING ENTITLED CELINE

TACNIERE V. GUESTLOGIXINC, ETAL., CV-16-545118-00CP r(l~,,

I, ALEX M. BODNARCHUK, of the -€ity of Regina Beach, in the Province of

Saskatchewan, MAKE OATH AND SAY AS FOLLOWS:

I. I am a retail investor that invested in Guestlogix Inc. ("Guestlogix"). I purchased 1,000

shares of Guestlogix on June 20, 2015, and 2,000 shares on October 22, 2015.




3. On January 25, 2016, Celine Tacniere commenced an action in the Ontario Superior

Court of Justice (File No.CV-16-545118) against Guestlogix and others (the "Tacniere

Action") alleging that, during the period from March 24, 2014 to and including

November 12, 2015 (the "Class Period"), Guestlogix and others published documents

and made statements about the Company's business, finances and operations that

-2-

contained misrepresentations. Attached as Exhibit "A" to this Affidavit is a copy of the

statement of claim in the Tacniere Action.



all similarly situated investors who purchased shares of Guestlogix during the Class

Period.

5. I am advised by Andrew Morganti and Benjamin Tinholt, the lead lawyers for the

plaintiffs in the Tacniere Action, that Guestlogix has applied to this Court for protection

under the Companies' Creditors Arrangement Act ("CCAA") and that the Tacniere

Action has been stayed as against Guestlogix (the "CCAA stay").

6. I am also advised by Andrew Morganti that, as soon as possible following the lifting of

the CCAA stay, the plaintiffs in the Tacniere Action will issue a fresh as amended

statement of claim (the "Fresh as Amended Claim"). Mr. Morganti has advised me that

the statutory secondary market claims (i.e. "purchasers' claims") advanced in the Fresh as

Amended Claim will proceed on the basis of a revised class period of June 8, 2015 to

November 12, 2015. The purchasers' claims are defined as "Class A" in the Fresh as

Amended Claim. I understand that I am a member of the proposed Class A.



Guestlogix's securities prior to June 8, 2015, and who held their securities after

November 12, 2015 (i.e. "holders' claims"), defined as "Class B" in the Fresh as

- 3 -

Amended Claim. Attached as Exhibit "8" to this Affidavit is a copy of the Fresh as

Amended Claim.

8. Further, I am advised by Benjamin Tinholt that although the actual economic damages of

the purchasers' claims may exceed $10 million, section 138.l of the Ontario Securities

Act limits the damages to 5% of Guestlogix's then market capitalization. Andrew

Morganti advises me that by applying the liability limit cap, the total collectible damages

for the purchasers' claim is approximately $5 million. Mr. Morganti advises me that the

common law holders' claim has no such liability limit cap.

SWORN before me at the City of ) e I it ~ , in the Province )

of S katchewan, this ll'l'day of ) May,2016. )

) ,//' /-/J ) '''· 2· / ) ·--\ _" . .&;..,~/14-t,/"A >

A Commissioner for taking Affidavits · ) for Ontario

BenJamfn D. Tlnholt

~Q -~~- . ~ ALEXM.BoDNARcHUK

Ben)amln D. nnholt

BETWEEN.

Court File No.: V -

ONTARIO SUPERlOR COURT OF JUSTICE

CELINE T ACNIERE,

and

Proceeding under the Clu.\~r Proceedings Act, 1992

STATEMENT OF CLAIM

TO THE DEFENDANTS:

Plaintiff

Defendants


JF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Form l 8A prescribed by the Rules of Civil Procedure, serve it on the plaintiffs lawyers or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and file it, with proof of service in this court office, WJTHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.

If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is forty days. If you arc served outside Canada and the United States of America, the period is sixty days.

Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Fonn l 88 prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within which to serve and tile your statement of defence.

lF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU fN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE.

cP

IF YOU PAY THE PLAINTIFF'S CLAIM, and $5,000.00 for costs, within the time for serving and filing your statement of defence you may move to have this proceeding dismissed by the court. Jfyou believe the amount claimed for costs is excessive, you may pay the plaintiff's claim and $400.00 for costs and have the costs assessed by the court.

TAKE NOTICE: THIS ACTION WILL AUTOMATICALLY BE DISMISSED ifit has not been set down for trial or tenninated by any means within five years after the action was commenced unless otherwise ordered by the court.

TO: GUESTLOGIX fNC 111 Peter Street, Suite 302 Toronto, ON M5V 2H I

AND TO: BRETT PROUD 11 l Peter Street, Suite 302 Toronto, ON M5V 2HI (Last known address and place of employment)

AND TO: PA TRICK LEUNG 111 Peter Street, Suite 302 Toronto, ON M5V 2Hl

AND TO: NATIONAL BANK FINANCIAL, INC. 130 King Street West, Suite 3200 Toronto, ON MSX IJ9

Jssued by:

( r 1"1 l l'f' 'l,J!( j ·.·, .. q :'. ·-"

)

Local Re&strar ... . -···· ..•.. -···-·· ··---;~--,~. Address of Court Ojfice:-

393 University Avenue, 10th Floor Toronto, ON MSG 1 E6

2

DEFINED TERMS

l. Jn addition to the terms dcfmcd in ss. I (I) and l 38. l of the Securities Act, R.S.O. 1990, c.

S. 5, and elsewhere herein, the following tenm used throughout this Statement of Claim have the

meanings indicated below:

(a) "AIF" means Annual Information Form, a5 defined in NI 51-102;

(b) "Class" or "Class Members" means all persons, other than Excluded Persons,

who acquired Guestlogix's securities during the Class Pe1iod and who held some

or all of those securities at the close of trading on November 12, 2015;

(c) "Class Period" means the period from and including March 24, 2014 to and

including November 12, 2015;

(d) "Corrective Disclosures" means the information concern mg Guestlogix 's

business, finances, and operations published on November 12 and December 16,

2015;

{c) "CJA" means the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended;

(f) ''Company" means Guestlogi.x;

(g) "CPA" means the Class Proceedings Act, 1992, S.O. 1992, c. 6, as amended;

(h) "CSA" means the Canadian Securities Administrators;

(i) "EBITDA" means earnings before interest, taxes, depreciation, and amo11i2ation;

a financial ratio for mc11suring a company's operating performance and

profitability;

3

U) "Equivalent Securities Act" means, collectively, the Securities Act, R.S.A. 2000,

c. S-4, as amended; the Securities Act, R.S.B.C 1996, c 418, as amended; The

Securities Act, C.C.S.M. c. S50, as amended; the Securities Act, S.N.B. 2004, c.

S-5.5, as amended; the Securities Acl, R.S.N.L 1990, c S-13, as amended; the

Securities Act, S.N.W.T. 2008, c. JO, as amended; the Securities Act, R.S.N.S.

1989, c. 418, as amended; the Securities kt, S Nu 2008, c. 12, as amended; the

Securities Act, R.S.P.E.l. 1988, c S-3. J, as amended; the Securiries Act, R.S.Q. c

V-1.l, as amended; The Securities Act. 1988, S.S. 1988-89, c. S-42.2, as

amended; and the Securities Act, S. Y. 2007, c. 16, as amended;

(k) "Excluded Persons'' means Guestlogix 's subsidiaries, affiliates, officers,

directors, senior employees, legal representatives, heirs, predecessors, successors

and assigns, and any member of the Individual Defendants' families and any

entity in which any of them has or had during the Class Period any legal or de

facto controlling interest;

(I) "GAAP" means Generally Accepted Accounting Principles in Canada;

(m) ''Individual Defendants" means Proud and Leung;

(n) "MD&A" means Management's Discussion and Analysis, as defined in NI 51-

!02. Under NI 5!-J02, a MD&A is required to be on Form 5l-l02Fl, and is a

narrative explanation, through the eyes of management, of how a reporting issuer

pcrfonned during the period covered by the financial statements, and of the


4

(o) "NBF" means National Bank Financial Inc.;

(p) "NI 51-102" means the CSA's National Instrument 51-102 - Continuous


(q) "NI 52-109" means the CSA's National Jnstrnment 52-109 Certification of

Disclosure in Issuers' Annual and Interim Filings. as amended;

(r) "Guestlogix" means Defendant Guestlogix, Inc.;

(s) ·'OSA" means the Secunties Act, R.S.O. 1990 c. S.5, as amended;

(t) "Plaintiff' means Celine Tacnierc;

(u) "Prospectus" means Guestlogix's final short form prospccn1s published on


December 22, 2014, public offering of 20 million subscription receipt'>, $20

million convertible unsecured subordinated debentures, and a private placement

of 10,479,000 subscription receipts;

(v) "SEDAR" means the CSA's System for Electronic Document Analysis and

Retrieval; and

(w) '·TSX" means the Toronto Stock Exchange.

5

RELIEF CLAIMED

2. The Plaintiff claims on her own behalf and on behalf of the other Class Members:

(a) An order certifying this action as a class proceeding and appointing her as the


(b) A declaration that <lunng the Class Period the Defendants made material


provided in Guestlogix 'score documents, including within its Prospectus;

(c) A declaration that NBF made a misrepresentation by omitting material facts about

certain financial covenants associated with Gucstlogix 's December 22, 2013

revolving credit facility in the Prospectus, which were not corrected. in whole or

in part, until November 12, 2015;


secondary market, an order granting leave to pursue the causes of action set out in

Part XXIII. l of the OSA and the comparable provisions in the Equivalent

Securities Acts as agains1 Gucstlogix and the Individual Defendants effective to

the date this action was commenced:

(c) With respect to those class members who acquired Gucstlogix's securities in the


Part XXIJI. L Section 138.3( I )(e) of the OSA and the comparable provisions in the

6

Eguivalen! Securities Acts as against NBF effective to the date this action was

commenced;

(f) A declaration that the Defendants made these misrepresentations negligently or


(g) A declaration that the Defendants failed to make full, tme, and plain disclosure in


(h) A declaration that the Defendants breached s. 56 of the OSA and the comparable


(i) A declaration that Defondants breached s. 75 of the OSA and the comparable


(i) A declaration that Guestlogix is vicariously liable for the acts and omissions of


(k) Statutory secondary market damages in the sum of $5 million plus common law

and statuto1y primary market damages in an amount in excess of $20 millino or



(I) An order directing a reference or giving such other directions as may be necessary

to detem1ine issues not detennined in the trial of the common issues;

(m) Prejudgment and post-judgment interest, compounded, or pursuant to ss. 128 and

129 of the CJA;

7

(n) Costs of this action on a full indemnity scale, or m an amount that provides


administering the plan of distribution of the recO\'ery in this action; and

(o) Such further and other relief as this Honourable Court deems just.



making other statements during the Class Period, includmg in the Company's financial

statements, containing material misrepresentations because they omitted material facts about

various financial covenants at1ached to two (2) different credit facilities. Additionally,

Guestlogix has announced that it will restate its prior financial statements due to material

accounting errors.

4. The Plaintiff alleges that Guestlogix securities' value and price was artificially inflated as

a result of the Defendants publishing core documents and making oral statements containing

misrepresentations of material fact.

5. On November 12, 20 J 6, Guestlogix announced that it was in default of two (2) separate

financial covenants corresponding to a revolving credit facility ( entered into December 23, 2013)

and a subordinated tenn credit facility (entered into June 5, 2015) because it had breached a

trailing EBITDA covenant. As a result of the breach, both credit facilities could become due on

demand by the lender, the long-term subordinated tenn credit facility became reclassified to

ctuTcnt, and the interest rate on the prmcipal amount of that credit facility rose from 12% to 18%.

6. Gucstlogix never disclosed thai there were financial covenants contained within these

credit facilities linked to a trailing EB1TDA or that the interest rate for the tc1m credit facility

would increase to 18%. This news immediately caused Guestlogix securities' perceived value

and price to drop more than 54% from $0.47 to $0.215 per share.

7. On December 16, 2015, Guestlogix announced that an internal review of its prior

accounting practices and revenue recognition policies concluded that it may be required to


restatement would be material. This news immediately caused Guestlogix securities' perceived

value and price to drop 43% from $0.2 I to $0.12 per share.

THE PLAINTIFF

8. Celine Tacnierc is an individual who resides in the City of Halifax, in the Province of

Nova Scotia. On September 2, 20 J 4, the Plaintiff purchased 20,000 Guestlogix securities and

realized a loss by holding those securities until after the Corrective Disclosures.

THE DEFENDANTS

9. Gucstlogix is an Ontario incorporated an<l operated company that is engaged in the

provision of transaction-based on board retail software solutions for the pa sscngcr travel industry.

I 0. During the Class Period, Guestlogix 's securities were publicly traded and were listed on

and traded under the ticker symbol "GXJ" on the TSX with a CUS1P identifier number 40163P.

There is also an over-the-counter market for Guestlogix 's securities in the United States and on

the Frankfm1 Stock Exchange.

9



Guestlogix is also a "responsible issuer" as defined ins. 138.l of the OSA and the comparable


l 2. The OSC is Guestlogix' s principal securities regulator in Canada. In connection with its


13. Pursuant to NI 51-102, as a reporting issuer m Ontario, Guestlogix was required

throughout the Class Period to, inter alia, issue and file with SEDAR:

(a) Within 10 days of the date on which a material change occurred, a material

change report on Fom1 51-l02F3 with respect to the material change and a press

release forthwith;

(b) Within 45 days of the end of each quarter, quarterly interim financial statements




financial statements; and

(e) Within 90 days of the end of its fiscal year, an AfF, including material

infonnation about the company and its business at a point in time in the context of

its historical and future operations.

10

14. Brett Proud was Guestlogix 's former President and Chief Executive Officer during the

Clas~ Period until September 16, 2015, when he resigned cffccrively immediately. During 2014,




2014, Leung's total compensation was $356,681. He made written and oral misrepresentations

to investors during the Class Period, as particularized herein.

16. National Bank Financial lnc., served as Guestlogix 's lead underwriter for its December

22, 20 J 4 public offering of subscription receipts and debentures.


17. On December 23, 2013, Guestlogix entered into a USO $4 million revolving credit

facility with a Canadian chartered bank. The Company's announcements did not disclose the

material facts about the financial covenants contained within I.he revolving credit facility.

18. On March 24, 2014, Gucstlogix published its audited annual financial statements, AIF,

and MD&A for fiscal 20 I 3. These core documents did not disclose the material facts about the

financial covenants contained within the revolving credit facility besides for the requiremenl that



requirements. Individual Defendants Proud and Leung certified that there were no

misrepresentations. These certifications were incorrect because of the reasons identified in the

Corrective Disclosures.

I L

19. On May 12, 2014, Guestlogix published its Ql 2014 financial results and MD&A. These

core documents did not disclose the material facts about the financial covenants contained within

the revolving credit facility. Individual Defendants Proud and Leung ce11ified that there were no



20. On August 11, 2014, Gucstlogix published its Q2 2014 financial results and MD&A.

These core documents did not disclose the material facts about the financial covenants contained

withm the revolving credit facility and subordinated tcnn credit facility. Individual Defendants

Proud and Leung certified that there were no misrepresentations. These certifications were

inconect because of the reasons identified in the Corrective Disclosures.

21. On November 3, 2014, Gucstlogix published its Q3 2014 financial results and MD&A.


within the revolving credit facility and subordinated term credit focility. Individual Defendants

Proud and Leung ce11ified that there were no misrepresentations. These certifications were

incon-ect because of the reasons identified in the Corrective Disclosures.

22. On December 17, 2014, Guestlogix published its Prospectus, with the consent of NFB,

for its 20 million subscription receipt ($0.95 each) and a $20 million 7% convertible unsecured

subordinated debenture ($1,000 face value per debenture). This core document did not disclose

1he material facts about the financial covenants contained within the revolving credit facility.

Individual Defendants Proud and Leung certified that there were no misrepresentations. These

certifications were incoffcct because of the reasons identified in the Corrective Disclosures.

12

23. With respect to the December 22, 2014 public offering, NBF and the syndicate

underwriters earned $0.05 per subscription receipt and $45 per dehenturc in underwriting fees.

NBF and the syndicate underwriters also certified that there were no misrepresentations. ·n1ese

certifications were incorrect because of the reasons identified in the Corrective Disclosures.

24. On December 22, 2014, Guestlogix with the assistance of NFB and the syndicate

underwriters closed the public and private offering of subscription receipts and debentures.

25. On December 23, 2014, Guestlogix acquired I 00% of the outstanding shares of OpenJaw

Technologies Limited ('OpcnJaw'), an Ireland-based provider of high performance t-Rctail

Platform, e-commerce and distribution solutions to airlines, online travel agencies, hotel groups

and loyalty marketing companies for USD$41.2 million.

26. On March I 6, 2015, Guestlogix published its audited annual financial statements, ATF,

and MD&A for fiscal 2014. These core documents revealed that the Company "was in breach of

a certain financial covenant under the tenns of the revolving credit facility" and that the bank had

agreed to an amendment of the covenant, but did not disclose the material facts about the


there were no misrepresentations. These certifications were incorrect because of the reasons

identified in the Corrective Disclosures.

27. On May 4, 2015, Guestlogix published its QJ financial results and MD&A. These core

documents did not disclose the material facts about rhc financial covenants contained within the

revolving credit facility. Individual Defendants Proud and Leung certified that there were no

misrepresentations. These certifications were inconect because of the reasons identified in the


13

28. On June 5, 2015 Guestlogix entered into a subordinated tem1 credit facility with a

principal amounl of USD $7.2 million (CAD $9 million) plus associated warrants with a

syndicate of lenders. The Company's announcement did not disclose the material facts about the

financial covenanl'> contained within this term credit facility, nor did they disclose that the stated

12% interest rate would increase to 18% were the Company to default on this credit facility.

29. On June 22, 2015, Gucstlogix obtained an amendment from the bank to increase the

revolving credit facility from USD $4 million to USD $7.5 million. The company did not issue

any announcement contemporaneously disclosing the increase in the credit facility, nor did it

disclose the mate.rial facts about the financial covenants contained within the revolving credit

facility.

30. On August I 2, 2015, Guestlogix published its Q2 financial results and MD&A. These


the revolving credit facility and subordinated term credit facility. Individual Defendants Proud

and Leung certified that then: were no misrepresentations. They also represented that it was their

opinion that existing cash flow and access to financing provided Gucstlogix with sufficient

resources to finance ongoing business requirements for the near term. These certifications were

incorrect because of the reasons identified in the Corrective Disclosures.

31. On September I 6, 2015, Guestlogix published a material change report that lndividual

Defendant Proud was ahruptly retiring as CEO and director of the Company. No other material

facts about his departure were disclosed.

32. On November 12, 2015, Guestlogix published its Q3 financial results and MD&A.

Guestlogix announced that as at September 30, 20 I 5, it was in breach of two (2) separate

14

financial covenants corresponding 10 the revolving credit facility (entered into December 23,

2013) and subordinated tcnn credit facility (entered into June 5, 2015) because it had breached

the trailing EBITDA covenants. Jt further revealed that a result of the breaches, the lenders could

immediately call both loans, the subordinated term credit facility was being reclassified from

long-tenn to current debt, and the interest rate on the subordinated term credit facility rose from

12% to 18%.

33. This Corrective Disclosure immediately caused Guestlogix securities' perceived value

and price to drop more than 54% from $0.47 to $0.2 I 5 per share.



that Gucstlogix may be required to restate its prior financial statements and that the preliminary

review indicated that the restatement would be material. This news immediately caused

Guestlogix securities' perceived value and price to drop 43% from $0.21 to $0. J 2 per share.

NO STATUTORY DEFENCE FOR FORWARD-LOOKING INFORMATlOJ\i


Statement of Claim contained foIWard-looking infonnation, some of those forward-looking

statements constituted misrepresentations because the Defendants had no reasonable basis for the

underlying assumptions on which this forward-looking information was based for the reasons


36. Further or in the alternative, to the ex tent that the statutory defences of sections 132. l and

J 38.4 do apply to any forward-looking statements pleaded herein, Guestlogix and the Individual

15

Defendants arc liable for those forward-looking statements containing the alleged

misrcprcsentalions because at the time each of those fmward-looking statements was made,

Guestlogix and the Individual Defendants knew or should have known that the particular

forward-looking statements were misrepresentations for the reasons alleged J1crein.

3 7. To the extent that the statutory defences of section 138.4 do apply to any forward-looking


looking statements containing the alleged misrepresentations because at the time that the

Prospectus was certified, the Defendants knew or should have known that the particular forward





found at section l30(l)(a)- (d) ofthe OSA and the Equivalent Securities Acts.

39. The Plaintiff asserts, in her personal and a representative capacity, seconda1y market

statutory causes of action against Defendant Guestlogix and Individual Defendants found at

sections 138.3( I )(a) - (c), l 38.3(2)(a) - (c), and section I38.3(4) of the OSA and the Equivalent

Securities A1,.;t:;.

40. The Plaintiff a5scrts, in her personal and in a representative capacity, secondary market

statutory causes of action against NBF found at section 138.3(l)(e) of the OSA and the

Equivalent Securities Acts.

THE RELATIONSHIP BET\VEEN THE MISREPRESENTATIONS AND THE PRICE A:\ID VALUE OF GUESTLOGIX'S SECURITIES

41 . The price and value of Guestlogix 's securities were directly affected each time that

Guestlogix and the Individual Defendants communicated new material changes and material

facts about Guestlogix's business, finances, and operations, including Gucstlogix's acquisitions,


percentages, compensation of insiders and management, and the number of Guestlogix' s issued


42. Guestlogix and the Individual Defendants were aware at all material times of the effect of

Guestlogix 's disclosures about its business, finances, and operations, including Guestlogix' s

acquisitions, accounting policies, revenue recognition policies, future revenue prospects, revenue

growth percentages, compensation of insiders and management, and the number of Gucstlogix 's


Guestlogix intended that the Class Members, including the Plaintiff, would rely upon these

disclosures, which they did to their detriment.


inunediately available to and were reproduced for inspection for the benefit of the Plaintiff and

the other Class Members, the public, financial analysts and the financial press through the




17


established market communication mechanisms, including through regular dissemination of

news releases on newswire services and through teleconferences with investors and analysts.


disclosure documents rcfcncd lo herein, with the effect that any recommendation in such reports

during the Class Period were based, in whole or in part, upon 1he news releases, interim and

amrnal filings, and statements m,tde during the investor conference calls, which contained

misrepresentations.

47. During the Class Period, Guestlogix's securities were traded on the TSX {and other

alternative trading platforms in Gennany and the United Sta1es), which is a highly efficient and

automated market. The price at which Guestlogix 's securities traded on the TSX incorporated

the infonnation in the disclosure documents referred to herein, including information about




THE VICARIOUS LIABILJTY OF GUESTLOGJX INC.

48. The acts particularized and alleged in this Statement of Claim to have been done by

Guestlogix were authorized, ordered and done by the Individual Defendants as well as other

officers, agents, employees and representatives who were engaged in the management, direction,

control and transaction ofGucstlogix's business, finances, and operations and are, therefore, acts

and omission:. for which Guestlogix is vicariously liable.

!8

PART XXIll.1 OF THE OSA

49. On behalf of the Plaintiff and those class members who purchased Guestlogix's

securities, the Plaintiff will bring a motion seeking leave to amend this Statement of Claim,


against Guestlogix and the Individual Defendants; and (b) assert the cause of action set out in s.

138.3(l)(e) of the OSA against NBF.

DAM.AGES

50. As a result of the conduct of the Defendants as alleged, the Plaintiff and each other Class

Member suffered losses and damages as a result of acquiring Guestlogix's securities at

artificially inflated prices on or after March 24, 2014, and holding some or all of those securities

after November 12, 2015. Therefore, the Defendants are liable to pay damages to the Plaintiff




this action.


52. This action has a real and substantial connection with Ontario because, among other

things:


(b) Defendant National Bank Financial, Inc. is located within Ontario;

19

(c) Class Members resident in Ontario acquired Gucstlogix shares and suffered

damage and loss; and

( d) the shares of Gucstlogix trade on the TSX, which is located in Ontario.

RE LEV ANT LEGISLATION

53. 'I11c Plaintiff pleads and relies upon the CJA, the CPA, NI 33-105, NI 43-101, NI 44-101,

NI 51-102, the OSA, and the Equivalent Securities Acts.

20

PLACE OF TRIAL

51. The Plaintiff proposes that the certified common issues be tried in the City of Toronto.

January 25, 2016

MORGANTI LEGAL Lawyers 169 ·K 111~ Street East, 3"' Floor Toronto, ON M5A 114

Andrew J. Morganti (LSUC# 57895E) Tel: (647)344-1900 Fax: (416) 800-2171


21


v. GUESTLOGIX £NC., et al Defendants

Court File No.


PROCEEDINGS COMMENCED AT TORONl

STATEMENT OF CLAIM


. Andrew J. Morganti ' LSUC# 57895E Tel: (647) 344-1900 [email protected]


BETWEEN:




Plaintiffs and

GUESTLOGIX INC., BRETI' PROUD, and PATRICK LEUNG

Defendants



TO THE DEFENDANTS:


IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Form 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiffs lawyers or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and file it, with proof of service in this court office, WITHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.


Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Form 18B prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within which to serve and file your statement of defence.

IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTJNG A LOCAL LEGAL AID OFFICE.

-2-



Date: Issued by: ---------Local Registrar


393 University Avenue 1o•h Floor Toronto ON MSG IE6

TO: OSLER, HOSKIN, & HARCOURT LLP 100 King Street West I First Canadian Place Suite 6200, P.O. Box 50 Toronto ON M5X I B8



AND TO: STOCKWOODS LLP BARRISTERS TD North Tower 77 King Street West Suite 4130, P.O. Box 140 Toronto ON M5K 1 H 1



- 3 -

DEFINED TERMS

I. In addition to the terms defined in ss. 1(1) and 138.1 of the Securities Act, R.S.0. 1990, c.






(d) "Class A" or "Class A Members" means all persons, other than Excluded Persons,



(e) "Class B" or "Class B Members" means all persons, other than Excluded Persons,



(f) "Class Members" means, collectively, the Class A Members and Class B

Members;


November 12, 2015;




-4-

U) "Company" means Guestlogix Inc.;




(l) "CPA" means the Class Proceedzngs Act, 1992, S.O. 1992, c. 6, as amended;


Credit Facility.





profitability;



Securities Act, C.C.S.M. c. SSO, as amended; the Securities Act, S.N.B. 2004, c. S~


Securities Act, S.N.W.T. 2008, c. IO, as amended; the Securities Act, R.S.N.S.


Securities Act, R.S.P.E.1. 1988, c S-3.1, as amended; the Securities Act, R.S.Q. c

-5-

V-1.1, as amended; The Securities Act, 1988. S.S. 1988-89, c. S-42.2, as amended;







(s) "GAAP" means Generally Accepted Accounting Principles in Canada;

(t) "Guestlogix" means Guestlogix Inc.;




Under NI 51-102, a MD&A is required to be on Form 51-102FI, and is a narrative




(x) "NI 51-102" means the CSA' s National Instrument 51-102---Continuous


(y) "NI 52-109" means the CSA's National Instrument 52-109-Certification of


-6-

(z) "Guestlogix" means Guestlogix Inc.;

(aa) "OSA" means the Securities Act, R.S.O. 1990 c. S.5, as amended;

(bb) "Plaintiffs" means, collectively, Tacniere and Bodnarchuk;

(cc) "Proud" means Brett Proud;


Retrieval;

(ee) "Tacniere" means Celine Tacniere;



Inc.; and



RELIEF CLAIMED


(a) An order pursuant to s. 5 of the CPA certifying this action as a class proceeding,


appointing Celine Tacniere as the representative plaintiff for Class B:

-7-


action set out in Part XXIII. l of the OSA and the comparable provisions in the











(g) Statutory and common law secondary market damages in the sum of $5 million per

plaintiff class, or such other sum as this Court finds appropriate at the trial of the

common issues or at a reference or references;


to detennine issues not detennined in the trial of the common issues;


129 of the CJA;

- 8 -










(a) a statutory claim for secondary market misrepresentation pursuant to Part XXIII of



(b) a common law holders• claim for secondary market misrepresentation on behalf of


(i.e. Class B).










12% to 18%.

6. Guestlogix never disclosed that the Credit Facilities contained financial covenants linked











THE PLAINTIFFS



realized a loss by holding these securities until after the November 12, 2015 Corrective Disclosure.

- 10-




THE DEFENDANTS

10. Guestlogix is an Ontario incorporated and operated company that is engaged in the


11. During and prior to the Class Period, Guestlogix' s securities were publicly traded and were

listed on and traded under the ticker symbol "GXI'' on the TSX with a CUSIP identifier number











- 11 -



fonhwith;





statements; and


about the company and its ·business at a point in time in the context of its historical







2014, Leung's total compensation was $356,681. He made written and oral misrepresentations to




provided the Company with USD $4 million in revolving credit.














From closing: After December 3 J, 2015:

$3,500,000 $3,250,000

6) (NEW) Maximum Trailing Six Month Capitalized Expenditures as follows: From closing: $ 1 ,500,000 After December 31, 2015: $750,000

- 13 -



amendments to the Comerica Credit Facility: Individual Defendants Proud and Leung certified



subordinated term credit facility with a principal amount of USO $7.2 million (CAD $9 million)



Guestlogix must:

[m]aintain minimum EBITDA calculated on a consolidated basis for the Borrower of not less than

( 1) US $2,000,000 for the Fiscal Quarter ending June 30, 2015; (2) US $3,000,000 for the Fiscal Quarter ending September 30, 2015; and (3) US $3,600,000 for each two Fiscal Quarter period ending December 31,









- 14 -







Guestlogix' s securities.


maximum principal of the Comerica Credit Facility was increased from USD $4 million to USD

$7.5 million. Guestlogix did not issue any announcement contemporaneously disclosing this








upon Guestlogix's documents which contained the misrepresentation in continuing to hold




- 15 -



30. On September 16, 20 I 5, Guestlogix published a Form 51-102F3-Material Change Report







further revealed that as a result of these breaches, the lenders could inunediately call both loans,

the Vistara Credit Facility had been reclassified from long-term to current debt, and the interest








securities' perceived value and price to drop 43% from $0.21 to $0.12 per share.

- 16 -












alleged herein.



statutory causes of action contained in_sections 138.3(l)(a) - (c), 138.3(2)(a) (c), and 138.3(4)



common law causes of action. Specifically, she asserts, in her personal capacity and on behalf.of



- 17 -

facts about Guestlogix' s business, operations and capital structure, and, as a result, she would have




Defendants disclosed material changes and material facts about Guestlogix's business, finances,

and operations, including Guestlogix' s acquisitions, accounting policies, revenue recognition


management, and the number of Guestlogix' s issued and outstanding shares.







detriment.







- 18 -


established market communication mechanisms. including through regular dissemination of news






misrepresentations.







number of Guestlogix' s issued and outstanding shares.


45. The acts particularized and alleged in this Fresh as Amended Statement of Claim to have





- 19 -

STATUTORY SECONDARY MARKET LIABILITY - PART XXIII.1 OF THE OSA

46. The Plaintiff will seek leave under s. 138.8( 1) of the OSA to assert the causes of action set

out in Part XXIII. l of the OSA against the Defendants, and to treat the multiple misrepresentations


DAMAGES

47. As a result of the conduct of the Defendants as aHeged, Bodnarchuk and each other Class

A Member suffered losses and damages as a result of acquiring Guestlogix' s securities at



138.5, and 138. 7(2) of the OSA, to Bodnarchuk and to the other Class A Members.



this action.



2015, and holding some or all of those securities after June 8, 2015. Therefore, the Defendants are

liable to pay damages, pursuant to the common Jaw, to Tacniere and to the other Class B Members.




-20-





51. The Plaintiffs plead and rely upon the CJA, the CPA, NI 51-102, NI 52-109, the OSA, and


May 24, 2016






Court File No. CV -16-545118-00CP





Andrew J. Morganti (LSUC# 57895E) Tel: (647) 344-1900Ext. 1 E-mail: [email protected]


EXHIBIT ''D''

Court F"lle No. CV-16-11281-ooCL


COMMERCIAL UST

IN THE MAITER OF THE COMPANIES' CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED

AND IN THE MATIER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. AND GUESTLOGIX


PROOF OF CLAIM

Please read carefully the enclosed Instruction Letter for completing this Proof of Claim form. Capitalized terms not defined within this Proof of Claim form shall have the meaning ascribed thereto in the Order of the Superior Court of Justice Commercial List dated April 29, 2016, as may be amended from time to time (the "Claims Procedure Orderj.



Harrington Global Opportunities Fund S.a.r.1., a member of Class "B" as that term is defined in the proposed Fresh as Amended Statement of Claim in Ontario Superior Court File No. CV-16-545118 attached hereto and marked as Exhibit "B" to Annex "A".




(4) E-mail Address:



c/o Morganti Legal

1 Yonge St, Suite 1506 ------ -----Toronto ON M5E1E5

- -----(647) 344-1900 Ext. 4

[email protected]

(416) 352-7638

Benjamin Tinholt


:J Yes rX:No


If the Claim set out herein has been sold, transferred or assigned, complete the required i,iformation set out below. If there is more than one assignee, please attach a separate sheet that contains all of the required i,iformation set out below for each assignee.




(4) Email Address:



C. PROOF OF CIAIM:

n/a

---·-----

THE UNDERSIGNED HEREBY CERTIFIES AS FOLLOWS:

(a) That I: c am a Claimant of one or more of the applicants; OR

lxlam Director

(state position or title)

of Harrington Global Opportunities Fund S.a.rl --·~----

(name of Claimant)


(c} The Applicant(s) was and still is indebted to the Claimant as follows (include all Claims that you assert against the Applicant(s). Claims should be filed in the currency of the transaction with an exchange rate as at the Filing Date (with reference to the contractual rate of interest, if any) and such currency should be indicated as provided below in respect of the Claim(s);

(d) If you are asserting your Claim against the Applicants' Directors or Officers you are required to complete section F of this Proof of Claim Form

r i Appllcant(s) (i)Amount of Claim

Outstanding asat

February 9, 2016

(ii) Amount of (iii) Total Secured Unsecured Restructuring Claim (Sum

Claim of (i) and (ii)

To be

x GuestLogix $ ascertain_El_~_ '""$ ____ =$ ___ _ Inc.

1- GuestLogix L_ ___ L_ ___ L __ _ Ireland Limited

Note: For the purpose of the Claims Procedure Order only ( and without prejudice to the terms of any plan of arrangement or compromise that may be.filed by the Applicant(s)), Claims will be converted to United States dollars at the Bank of Canada noon spot rate as at the Filing Date. The exchange rate conversion on such date was:

n CAD $1.3820 - US$1.oo o GBP - $0.6902 - US$1.oo a EUR - $0.8836 - US$1.oo


(CHECK.AND COMPLETE APPROPRIATE CATEGOR}'.)

Applicant:




$ ___________ _, (Original Currency and amount)


Unsecured Claim of $ ______________ _


Give fall particulars of the security, including the date on which the security was given the value which you ascribe to the assets charged by your security, the basis for such valuati'on and attach a copy of the security document$ evidencing the security.

Jf you are asserting multiple secured claims, against one or more of the Applicants, please provide full details of your security against each of the Applicants.


Other than as already set out herein, the particulars of the undersigned's total Claim against the Applicant(s) are attached on a separate sheet. See Annex "A"

Provide all particulars of the Claim and supporting documentation that you feel will assist in the detennination of your Claim. At a minimum, you are required to provide the invoice date, invoice number, the amount of each outstanding invoice and the related purchase order number. Further particulars may include the following if applicable: a description of the transaction(s) or agreement(s) giving rise to the Claim; contractual rate of interest (if applicable); name of any guarantor which has guaranteed the Claim; details of all credits, discounts, etc. claimed; description of the security if any, granted by the affected Applicant(s) to the Claimant, the estimated value of such security and the basis for such valuation; and the particulars of any Restructuring Claim.


THIS SECTION SHOULD ONLY BE COMPLETED BY A CLAIMANTASSERTING A CLAIM AGAINST THE DIRECTOR<Sl AND OFFICER($) QFfflEAPPLICANT(Sl. A CLAJMANTASSERTINGA CLAIM ONLY AGAINST THE APPUCANTIS) SHOULD NOT COMPLETE nus SECTION.

THE UNDERSIGNED HEREBY CERTIFIES AS FOU.OWS:

(a) That I:

1 1 am a Claimant of one or more of the applicants, OR.

x1am

of

Director


Harrington Global Opportunities Fund S.a.r.l.

(name of Claimant)


Patrick Leung

Brett Proud

(c) That I have knowledge of all the circumstances connected with the Claim described and set out below;


$ To be ascertained --------------(Original Currency)


$ _____________ _

(Original Currency)

G. FIUNG OF CLAIM:

This Proof of Claim fonn must be returned to and received by the Monitor by no later than

5:00 p.m. (Eastern Time) on June 2, 2016 (the "Prefiling Claims Bar Date"),


to your Restructuring Claim on1y must be received by the Monitor by no later than 5:00

p.m. (Eastem Time) on the date which is the earlier of the Prefiling Claims Bar


the Monitor sends a Claims Package with respect to a Restructuring Claim in

accordance with the Claims Procedure Order (the "Restructuring Claims Bar



PricewaterhouseCoopers Inc,, Monitor of GuestLogix Inc. and Guestl.ogix Ireland Limited PwCTower 18 York Street, Suite 2600 Toronto ON MsJ 0B2


DATED this } / $f day of

~ Witness Name:

Benjamin Tinholt

f141~. r;~na~~ If Claimant is a Corporation, print name and title of authorized signatory:

Name: Danny Guy

Title: Director, Harrington Global Opportunities Fund S.a.r.l.

Note: .After signing this form, please ensure you return all pages of this Proof of Claim to the Monitor.



COMMERCIAL LIST



(the "Applicants")

AFFIDAVIT OF DANNY GUY

ANNEX "A" TO PROOF OF CLAIM OF HARRINGTON GLOBAL OPPORTUNITIES FUND, S.a.r.l., A MEMBER OF THE PUTATIVE CLASS IN THE CLASS

PROCEEDING ENTITLED CELINE TACNIERE V. GUESTLOGIX INC., ET AL., CV-16-545118-00CP

I, DANNY GUY, of Smith's Parish, Bermuda, MAKE OATH AND SAY AS FOLLOWS:

1. I am a director of Harrington Global Opportunities Fund, S.a.r.1., a Luxembourg

corporation that is a shareholder of Guestlogix Inc. ("Guestlogix"). As of June 8, 2015,

Harrington Global Opportunities Fund, S.a.r.l. held 13,360,000 shares of Guestlogix.





of Justice (File No. CV-16-545118) against Guestlogix and others (the "Tacniere Action")



-2-


Attached as Exhibit "A" to this Affidavit is a copy of the statement of claim in the Tacniere

Action.



all similarly situated investors who purchased shares ofGuestlogix during the Class Period.













Guestlogix's securities prior to June 8, 2015, and who held their securities after June 8,

2015 (i.e. "holders' claims"), defined as "Class B" in the Fresh as Amended Claim. I

understand that Harrington Global Opportunities Fund, S.a.r.1. is a member of the proposed

Class B.

- 3 -

8. Attached as Exhibit "B" to this Affidavit is a copy of the Fresh as Amended Claim.

SWORN before me at the City of Toronto, in the Province of Ontario, this 3181 day of May, 2016.

A Commissioner for taking Affidavits for Ontario

BenJam,,. D. Tlnholt

llj ,.

This is Exhibit. ... ff Y referred to in the affidavit of .•••• JZ.'"J..~tv _ 'VY ...... . sworn before me, this J / if ............. . day of. t1d Y .. 20 .• /J .. .

S.U-,n D. Tlnholt

BETWEEN:

Court File No.: ' \


CELINE TACNIERE,

Plaintiff and

't :pESTLOGIX INC., BRETT PROUD, PATRICK LEUNG, and NATIONAL BANK FINANCIAL, INC.,

Proceeding under the Class Proceedings Act, J 992

STATEMENT OF CLAIM

TO THE DEFENDANTS:

Defendants

A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the plaintiff The claim made against you is set out in the following pages.

IF YOU WISH TO DEFEND THIS PROCEEDING, you or au Ontario lawyer acting for you must prepare a statement of defence in Fom1 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiff's lawyers or, where the plaintiff does not have a lawyer, serve it on the plaintiff~ and file it, with proof of service in this cout't office, WITHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.

If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is forty days. If you arc served outside Canada and the United States of America, the period is sixty days.


IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE.


TAKE NOTICE: THIS ACTION WILL AUTOMATICALLY BE DISMISSED if it has not been set down for trial or tenninated by any means within five years after the action was commenced unless otherwise ordered by the court.

Date: ___ ;; ____ _

TO: GUESTLOGIX INC 111 Peter Street, Suite 302 Toronto, ON M5V 2Hl


AND TO: PATRICK LEUNG 111 Peter Street, Suite 302 Toronto, ON M5V 2Hl

AND TO: NATIONAL BANK FINANCIAL, INC. 130 King Street West. Suite 3200 Toronto, ON M5X I 19

Issued by:

__Local Re__gistrar__ _ __ ·---•"tt7=-,-,-..· ___ _ Address c!f Court 'O]flcei ·

393 University Avenue, 10111 Floor Toronto, ON M5G 1E6

2

DEFINED TERMS

J. ln addition to the terms defined in ss. I (I) and 138.1 of the Securities ACT, R.S.O. 1990, c.

S. 5, and elsewhere herein, the following terms used throughout this Statement of Claim have the




who acquired Guestlogix's securities during the Class Period and who held some


(c) "Class Pe1·iod" means the period from and including March 24, 2014 to and


( d) "Corrective Disclosures" means 1he information concerning Guestlogix 's

business, finances, and operations published on November 12 und Dccemher 16,

2015;


(f) "Company" means Guestlogix;

(g} ''CPA" mea111; the Class Proceedings Act, JYY2, S.O. 1992, c. 6, as amended;

(h) "CSA" means the Camtdian Securities Administrators;

(i) "EBITDA" means earnings before interest, taxes, depreciation, and amortization;

11 financial ratio for mc11suring a company's operating performance and

profitability;

3

(j) "Equivalent Securities Act" means, collectively, the Securitit!S Act, R.S.A. 2000,

c. S-4, as amended; the Securities Act, R.S.B.C'. 1996, c 418, as amended; Th<'

Securities Act, C.C.S.M. c. S50, as amended; the Securities Ad, S.N.B. 2004, c.

S-5.5, as amended; the Securities Act, R.S.N.L. 1990, c S-13, as amended; the


1989, c. 418, as amended; the Securities Act, S Nu 2008, c. 12, aH amended; the

Securities Act, R.S.P.E.l. J 988, c S-3. l, as amended; the Securities Acr, R.S.Q. c

V-1.l, ns amended; The Securities Act, 1988, S.S. 1988-89, c. S-42.2, ns

amended; and the Securities Act, S.Y. 2007, c. 16, as amended;

(k) "Excluded Persons" means Guestlogix's subsidiaries, affiliates, oHicers,

directors, senior employees, legal representative::.;, heirs, predecessors, successors

and assif,'TIS, and any member of the Individual Defendants' families and any


}t1cto controlling interest;


(111) ''Individual Defendants" means Proud and Leung;

( n) ·'MD&A" means Management's Discussion and Analysis, as defined in NI 51-

102. Under N! 51-102, a MD&A is required to be on Form 5J-102Fl, and is a

narratiw explanation, through the eyes of management, of how a reporting issuer

performed during the period covered by the financial statements, and of the


4


(p) "NI 51-102" means the CSA's National lnstrwnent 51-102 - Continuous


(q) "NI 52-109" means the CSA's National Jnstnnnent 52-109 - Certification of



(s) "OSA" means the Securities Act, R.S.O. 1990 c. S.5, as umended;

(t) ·'Plaintiff" means Celine Tacniere;

(u) ''Prospectus" means Gucstlogix's final short fonn prospectus published on

SEDAR on December 17, 2014, whicli was associated with the Company's

December 22, 2014, public offering of 20 million subscription receipts, $20

million convertible unsecured subordinated debentures, and a privute placement

of I 0,4 79,000 subscription receipts;

(v) "SEDAR'' means the CSA's System for Electronic Document Analysis and

Retrieval; and

(w) "TSX" means the Toronto Stock Exchange.

5

Rfi:l_.rnF CLAIJ\rnD

2. The Plaintiff claims on her own behalf and on behalf of the other Cla:;s Members:



(b) A declaration lhat during the Class Period the Defendants made material


provided in Gucstlogix's core documents, including within its Prospectus;


certain financial covenants associated with Guestlogix's December 22, 2013

revolving cn~dit facility in the Prospectw,, which were not conectcd, in whole or


(d) With respect to those class members who acquired Guestlogix's securities iu the


Part XXIII.I of the 05'A and the comparable provisions in the Equivalent

Securities Acts as against Gucsllogix and the Individual Defendants effective lo

the date this action was commenced:

(e) With respect to those class members who acquired Gucstlogix's securities in the

secondary market, an order granting ]eave to pursue the causes of ,wtion set out in

Part XXJIJ.l. Section I38.3(l)(e) of the OSA and the comparable provisions in the

Equivalent Securities Acts as against NBF effective to the date this action was

commem:ed;

(t) A declaration that the Defendants made these misrepresentations negligently or


(g) A declaration that the Defendants failed to make full, true, and plain disclosure in


(h) A declaration that the Defondants breached s. 56 of the OSA and the comparable




(i) A declaration that Guestlogix is vicariously liable for the acts and omissions of


(k) Statutory se(;ondary market damages in the sum of $5 million plus common law

and statutory pdrna,y market damages in an amount in excess of $20 millino or

su(;h other sum as this Court finds appropriate at the trial of the common issues or


(I) An order directing a reference or giving such other directions as may be necessary

to deienninc issues not dete1mined in the trial of the (;Onunon issues;


129 of the CJA;

7

(n) Costs of this action on ll full indemnity scale, or m an amount that provides

substantial indemnity plus, pursuant to s. 26(9) of the CPA, !he costs of


( o) Such further and other relief as this l1011ourable Court deems just.


3. This St~curities class action relates io the Defendants publishing core documents and

making other statements during the Class Period, including in the Company's financial


various fimmcial covenants attached to two (2) different credit facilities. Additionally,

Uuestlogix has announced that it will restate its prior financial statements due to material

accounting errors.

4. The Plaintiff alleges that Guestlogix sucurities' value and price wm: artificially inflated as



5. On November 12, 20 J 6, Uuestlogix announced that it was in default of two (2) separate

financial covenants corresponding to a revolving credit facility ( entered into December 23, 20 I 3)

and a subordinated term <.:redit facility (entered into June 5, 2015) because it had breached a



current, an<l the mteresl rate on the principal amount of that credit facility fOS\l from 12%) to 18'.l-·o.

8

6. Guestlogix never disdosed that there were financial covenants contained within these

credit facilities linked to a trailing EBITDA or that. the interest rate for the term credit facility


aud price to drop more than 54% from $0.47 to $0.215 per share.

7. On December J 6, 2015, Gucstlogix announced that an internal review of its prior

accounting practices and revenue recognition polic.ics concluded that it may be required I\)


restatement would be material. This news immediately caused Gucstlogix securities· percciwd

value and price io drop 43o/o from $0.2 l to $0. l 2 per share.

THE PLAINTIFF'

8. Celine Tacnierc is an individual who resides in the City of Halifax, in the Province of

Nova Scotia. On September 2, 2014, the Plaintiff purchased 20,000 Guestlogix securiiies and


THE DEFENDANTS

9. GLicstlogix is an Ontario incorporated and operated company that is engaged in the

provision oftnmsaction-bnscd onboard retail sotlwarc solutions fr)r the passenger travd induslry.

IO. During the Class Period, Guest.logix's securities were publicly traded and were listed on

and traded under the tick:er symbol "GXJ" on the TSX with u CUS1P identifier number 40163P.

There is also an uver-the-counter market for Guestlogix's securities int.he United Staks and on

the Frankfurt Stock Exchange.

11. Uuestlogix is a reporting issuer in British Columbia, Alberta, Saskatchewan, Manihlba,


Gucstlogix is also a "responsible issuer" as defined in s. 138.1 of the OSA and the comparable


12. The OSC is Guestlogix's principal securities regulator in Canada. ln connl:!ction with its


13. Pursuant to NI 51-102, as a reporting issuer in Ontario, Guestlogix was required


(a) Within 10 days of the date on which a material change occurred, a muterial

change report on Form 51-102F3 with respect to the material change and a press

release forthwith;


containing all the matetinl facts that arose during the quarter:




(e) Within 90 days of the end of its fiscal year, an AIF, including material

information about the company and its business at a point in time in the context of


10

14. Brett Proud was Gucstlogix 's former President and Chief Executive Officer during the

Class Period until September 16, 20!5, when he resigned effectively immediately. During 2014,

Proud's total compcusation was $614,907. Proud made written and oral mi:::repres<::ntations to

investon, during the Cla8s Period, as Jrnrticularized herein.

15. Patrick Leung was Guestlogix's Chief Financial OHiccr during the Class Period. During

2014, Leung 's total compensation was $'.156,681. He mnde written and oral misrepresentations


16. National Bank Financial lnc., served as Gue:;tlogix \; katt underwriter for its December

22, 2014 public offering of subscription receipts an<l debentures.


17. On December 23, 2013, Guesllogix entered into a USD $4 million revolving cn:dit

facility with a Canadian chartered bank. The Company's aiu1ouncements did not disdose the

material facts about the financial covenants contained within the revolving credit facility.

18. Ou March 24, 2014, Guest!ogix published its audited annual financial statements, AH\

and MD&A for fiscal 20 I 3. These core documents did not disclose the material fact:; about tlw

financial covenallts contained within the revolving credit facility besides for the requirement that

it must maintain a $1 million balanc.: with the lender and have a tangible net worth or $2.6

million. Specifically, there was no disclosure that there were trailing EBlTDA ratio

requirements. Jndividual Defendants Proud and Leung certified that there were no

misrepresentations. These ce11ificat:ions were incorrect because of the reasons identified in the


11

19. On May 12, 2014, Guestlogix published its QI 2014 financial results and MD&A. These

core documents did not disclose the material tacts about the financial covenants conlained within

the revolving credit facility. Individual Defendants Proud and Leung ce1iified that there were no

rnisreprcscntatiom. These certifications were incorrect because of the reasons identified in the

C\mective Disclosures.

20. On August J l, 2014. Gucstlogix puhlishcd its Q2 2014 financial results and MD&A.


within the revolving credit facility and subordinated term crcdil facility. individual Defendants

Proue.I and Leung certified that there were no misrepresentations. TJ1esc certifications were

inco1Tect because of the reasons identified in the Corrective Disclosures.

2 J. Ou November \ 2014, Gncstlogix published its Q3 2014 financial results and MD&A.

ThcSL'. core documents did not disclose the material facts about the financial covenants contained

within the revolving credit foeility and subordinale<l tem1 credit facility. Individual Defendants

Proud and Leung certified that there were no misrepresentations. These certifications wt:re


22. On December 17, 2014, Guestlogix published its Prospectus. with the consent of NFB,


subordinate.cl debenture ($1,000 face value per debenture). This core document did not ti isclose

the material facts about the financial covenants contained within the revolving credit facility.


certifications Wl~re incorrect b<~cause of the reasons identified in the Corrective Disclosures.

12


underwriters earned $0.05 per subscription receipt and $45 per dehenturc in underwriting feer,.

NBJ~ and tbc syndicate underwriters also certified that there were no misrepresentations. These

certifications were inconect because of the reasons identified in the Conectivc Disclosures.


underwriters closed the publil: and private offering of subscription receipts and debentures.

25. On December 23, 2014, Guestlogix acquired 100% of the outstanding shares ofOpcnJaw

Technologies Limited ('Opcnfaw'), an Ireland-based provider of high perfoxmancc t-Rctail



26. On March 16, 2015, Guesllogix published its audited annual financial statements, AlF,



a1:,11·ced to an mnendmcnt of the covenant, but did not disclose the material facts about the



identified in the Corrective Disclmmres.

27. On May 4, 2015, Gucstlogix published its QJ financial results and MD&A. These core

documc11ts did not disclose the material facts about the fimmcinl covenants contained within the

revolving credit facility. lmlividual Defendants Proud and Leung certified that there were no



13

28. On June 5, 2015 Guestlogix entered into a subordinated term l'.l'cdit facility with a

principal amount of USD $7 .2 million (CAD $9 million) plus associated warnmts with a

syndicate of lenders. The Company's announcement did 1iot disclose the material facts abllul the

Jimmcial covenants contained within this term credit facility, nor did they disclose !hat the staled

12'!,> interest rate would increase to 18% were the Company to default on this credit facility.

29. On June 22, 2015, Gncstlogix obtained an amendment from the bank to increase the

revolving credit facility from USD $4 million to USD $7.5 mi!lion. The company did not issue

any announcement contemporaneously disclo1,ing the increase in the credit facility, nor did it

disclose the nullerial facts about the financial covenants contained within the revolving credit

facility.

30. On August 12, 2015, Guestlogix published its 02 financial results and MD&A. These


the revolving credit facility and subordinated term credit facility. In<lividual Defondm11s Proud

and Leung certified that there were no misrepresentations. Tiley also represented that it was their

opinion that existing cash flow and access IO financing provided G11cstlogix with sufficient

resources to finance ongoing business requirements for the near term. These <..:ertifications were

incorrect because of the reasons identified in the Correctiw Disclosures.

31. On September 16, 2015, Guestlogix published a material change report that lndividual

Defendant Proud wa8 abruptly retiring as CEO and director of the Company. No other material

facts abom his departure were disclosed.


Guestlogix an1101mccd that us at Septembi.:r 30, 2015, it was in breach of' two (2) separak

14

financial covenants coJTcsponding to the revolving credit facility ( entered into December 23 .,

2013) and subordinated term credit facility (entered into June 5, 2015) because it had breached

the trailing EBlTDA covenants. 1t further revealed that a result of the breaches, the lenders could

immediately call both loans, the subordinated term credit focility was being reclassified from

long-term to cun-ent debt, and thi:: interest rate on the subordinated term credit facility rose from

12% to 18%.

33. This Corre.ctive Disclosure immediately caused Guestlogix securities' perceived value


34. On December 16, 2015, Gucstlogix annourn;ed that its new CEO had initiated an inttm1al



review indicated that the restat.ement would be material. This news immediately caused

Guestlogix securities' perceived value and price to drop 43% from $0.21 tu $0.12 per share.


35. To the extent that any of the disclosure- documents or public statements addrc:;scd in this

Statement of Claim contained forward-looking infonnation, some of those forward-looking

statt:ments constituted misrepresentations because the Defendants had no reasouablc basis for 1 he



36. Further or in the alternative, to the extent that the statutory defences of sections J 12. I and

JJ8.4 do apply to any forward-looking statcnicnts pleaded herein, Uuestlogix and the Individual

l 5



Oucsllogix and the Individual Defontlants knew or should have known that the particular

fo1ward-looking statements were misrepresentations for the reasons alleged herein.

37. To the extent that the statutory defences of section 138.4 do apply to any forward-looking

statements in the core document pleaded herein, the Defendants arc liable for tho;;e forward


Prospectus was certified, the Defendants knew or should have known lhat the particular fo1ward


THE CAUSltS OJ? ACTION ASSERTED BY THE PLAINTIFF AND CLASS

38. The Plaintiff asserts, in her personal and a representative capacity, prima1y marki.:t

statutory causes of action against Defendant Guestlogix and Individual Defendants, and NBf

frmnd at section l30(l)(a)- (d) of the OSA and the Equivalent Securities Acts.

39. The Plaintiff asserts, in her personal and a representative capacity, secondary madcet


sections J38.3(l)(a) --(c), 138.3(2)(a)-(c), and section 138.3(4) of the OSA and the Equivalent

Sccoritit-s Acts.

40. The Plaintiff asserts, in her personal and in a representative capaeity, secondary mark.el

statutory causes of action against NBF found at section 138.3(l)(e) of the 00>1 and the:


16

nm IUDLATIONSHIP DJnWEEN THE MISREPRESENTATIONS AND THE PRICE AND VALUE OF GUESTLOGIX'S SECURITIES


Guestlogix and the Jndividual Defendants communicated new material changes and material

fa<.:IS about Guesllogix.'s business, fin:mccs, and operations, including Gucstlogix's acquisitions,

accounting policie8, revenue rec.ognition policies, fuhirc revenue prospects, revenue growth

percentages, compensation of insiders and management, and the number of Guestlogix 's issued


42. Gm:stlogix and the Individual Defendants were aware at all material times of the effect of

Guestlogix 's disclosures about its business, finances, and operations, including Gue.stlogix 's

acquisitions, accounting policies, revenue rccognjtion policies, future revenue prospects, revcnu,:.

growth percentages, compensation of insiders and management, and the number of Gucstlogix 's


Guestlogix intended that the Class Members, includiug the Plaintiff: would rely upon these


43. The disclosure documents rcfen-ed to herein were filed with SEDAR and thereby became

immediately available to and were reproduced for inspection for the benefit of the Plaintiff and

the other Class Memben;, the public, financial analysts and the financial press through the


44. Gucstlogix routinely trnm;mitled the documents reforrc<l to herein to the financial press,

fo1am:ial analysts and certain prospective and existing shareholders of the Company.

17

45. Gucstlogix regularly communicated with public investors and financial analysts via

established market conununication mechanisms, including through regular disse.minalion of

uews rekases on newswire services and through teleconferences with investors and analysts.

46. G ue8tlogix was the subject of analysts' reports that incorporated the information in the

disclosure docrnnent8 referred to herein, with the effccl that any recommendation in such reports


annual filings, and statements made during the investor conference calls, which contained

misrepresentations.


alternative trading platforms in Gcnnany and the United States), which is a highly efficient and

automated market. The price at which Guestlogix's securities traded on the TSX incorporated

the information in the disdosurc documents referred to herein, including information about


prospects, revenue growth percentage~. compensation of insiders and management, and the

number of Gucstlogix 's issued and outstanding shan~s.

THE VJCARlOlJS LIABILITY 01<' GUESTLOGIX INC.

48. The acts parti<.:ularized and alleged in this Statement of Claim lo have bee11 done by

Guestlogix were authorized, ordered and done by the Individual Defendants as well a:; other

officen:;, agents, employees and representatives who were engaged in the manageme11t, direction,

control and transaction of'Guestlogix's business, finances, and operations and arc, therefore, acts

and omissions for which Guestlogix is vicariously liable.

18

PART XXlll.1 01<' THE OSA

49. On behalf of the Plaintiff and those class members who purchnsed Guestlogix's



against Guestlogix and the Individual Defendants; and (b) assert the cause of action set out ins.


DAMAGES


Member suffered losses and damages as a result of acquiring Guestlogix 's securities at


after November 12, 2015. Therefore, the Defendants arc liable to pay damages to the Plaintiff




this action.



things:

(a) Defendant Guestlogix is a reporting issuer in Ontario:

(b) Defendant Nat.ional Bank Financial, lnc. is located within Ontario;

19

(c) Class Members resident in Ontario acquired Gucstlogix shares a11d suff<.ired

damage and Joss; and

( dJ t.lic 8hares of Guestlogix trade on the TSX, which is localed in Ontario.

H.ELE\' ANT LEGISLATiON

53. The Plaintiff pleads and relies upon the CIA, the CPA, NJ 33-105., NI 43-101, NJ 4.:/-10/,

NJ 51-102, the OS.A, and the Equivalent Securities Acts.

:.?.O

PLACE OF TRIAL

5 l. The Plaintiff proposes thal !he certified common issues be tried in the City of Toronto.

Janmuy 25. 2016

MORGANTI LEGAi, J,awvcr;; 169 i< ill!!, Street East, 3'd Floor Toronto, ON MSA JJ4

Andnw .J. Morganti (l ,SlJCt/ 57895E) Tel: ( 64 7) 344-1900 Fax: (416) 800-2171


21



Court File No.

i ONTARIO SUPERIOR COURT OF JUSTICE

PROCEEDINGS COMMENCED AT TORON1

STATEMENT OF CLAIM


Andrew J. Morganti LSUC# 57895E Tel: (647) 344-1900

· [email protected]


,, , ,, This is Exhibit. I) referred to in the affidavit of ... 1tf'l/'I f $ II>:' ........ . sworn before me, this ..... 1/.j_f. ............. . day of. ·-·-··-······_,..2 __ _

&enJam,n D. Tlnholt



BETWEEN:


Plaintiffs and


Defendants



TO THE DEFENDANTS:






- 2 -

IF YOU PAY THE PLAINTIFF'S CLAIM, and $5,000.00 for costs, within the time for serving and filing your statement of defence you may move to have this proceeding dismissed by the court. If you believe the amount claimed for costs is excessive, you may pay the plaintiff's claim and $400.00 for costs and have the costs assessed by the court.




393 University A venue 101h Floor Toronto ON M5G IE6

TO: OSLER, HOSKIN, & HARCOURT LLP 100 King Street West

AND TO:

1 First Canadian Place Suite 6200, P.O. Box 50 Toronto ON M5X 1 B8



STOCKWOODS LLP BARRISTERS TD North Tower 77 King Street West Suite 4130, P.O. Box 140 Toronto ON M5K IHI



- 3 -

DEFINED TERMS

1. In addition to the terms defined in ss. 1(1) and 138.1 of the Securities Act, R.S.0. 1990, c.









(e) "Class B" or "Class B Members" means all persons, other than Excluded Persons,



(t) "Class Members" means, collectively, the Class A Members and Class B

Members;


November 12, 2015;




- 4 -

(j) "Company" means Guestlogix Inc.;




(I) "CPA" means the Class Proceedings Act, 1992, S.0. 1992, c. 6, as amended;


Credit Facility.





profitability;

(q) "Equivalent Securities Act" means, collectively, the Securities Act, RS.A. 2000,


Securities Act, C.C.S.M. c. S50, as amended; the Securities Act, S.N.B. 2004, c. S-




Securities Act, R.S.P.E.I. 1988, c S-J.l, as amended; the Securities Act, R.S.Q. c

- 5 -








(s) "GAAP" means Generally Accepted Accounting Principles in Canada;





Under NI 51-102, a MD&A is required to be on Form 51-102F 1, and is a narrative






(y) "NI 52-10~" means the CSA's National Instrument 52-109-Certification of


- 6 -


(aa) "OSA" means the Securities Act, R.S.O. 1990 c. S.5, as amended;




Retrieval;




Inc.; and



RELIEF CLAIMED


(a) An order pursuant to s. 5 of the CPA certifying ·this action as a class proceeding,



-7-


action set out in Part XXIII.1 of the OSA and the comparable provisions in the


( c) A declaration that during the Class Period Guestlogix and the Individual



( d) A declaration that the Defendants made these misrepresentations negligently or






(g) Statutory and common law secondary market damages in the sum of $5 million per

plaintiff class, or such other sum as this Court finds appropriate at the trial of the

common issues or at a reference or references;




129 of the CJA;

-8-















(i.e. Class B).






- 9 -





12% to 18%.












THE PLAINTIFFS


Province of Saskatchewan. On Octob~r 22, 2015, he purchased 2,000 Guestlogix securities and


- 10-




THE DEFENDANTS




listed on and traded under the ticker symbol "GXI" on the TSX with a CUSIP identifier number











- 11 -



forthwith;



( c) within 90 days of the end of the fiscal year, annual financial statements;

( d) contemporaneously with each of the above, a MD&A of each of the above financial

statements; and


about the company and its 'business at a point in time in the context of its historical









- 12 -




18. .on March 16, 2015, Guestlogix published its audited annual financial statements, AIF, and










Borrower, to maintain on a monthly basis, unless otherwise noted: [ ... J




$3,500,000 $3,250,000


- 13 -



amendments to the Comerica Credit Facility.· Individual Defendants Proud and Leung certified






Guestlogix must:

[m]aintain minimum EBITDA calculated on a consolidated basis for the Borrower of not less than

(1) US $2,000,000 for the Fiscal Quarter ending June 30, 2015; (2) US $3,000,000 for the Fiscal Quarter ending September 30, 2015; and (3) US $3,600,000 for each two Fiscal Quarter period ending December 3 I ,





23. On June 8, 2015, Guestlogix published a press release announcing the dosing of the Vistara

Credit Facility. The press release did not disdose the material facts about the financial covenants



- 14-






relied upon Guestlogix' s documents which contained the misrepresentation in continuing to hold



maximum principal of the Comerica Credit Facility was increased from USO $4 million to USD

$7.5 million. Guestlogix did not issue any announcement contemporaneously disclosing this








upon Guestlogix's documents which contained the misrepresentation in continuing to hold

Guestlogix's securities.



- 15 -



30. On September 16, 2015, Guestlogix published a Form 5l-102F3-Material Change Report







further revealed that as a result of these breaches, the lenders could immediately call both loans,










- 16 -












alleged herein.



statutory causes of action contained in_sections I38.3(l)(a) - (c), 138.3(2)(a) - (c), and 138.3(4)



common Jaw causes of action. Specifically, she asserts, in her personal capacity and on behalf.of



- 17 -

facts about Guestlogix's business, operations and capital structure, and, as a result, she would have





and operations, including Guestlogix' s acquisitions, accounting policies, revenue recognition


management, and the number of Guestlogix's issued and outstanding shares.


about its business, finances, and operations, including Guestlogix' s acquisitions, accounting





detriment.







- 18 -








misrepresentations.







number of Guestlogix' s issued and outstanding shares.



been done by Guestlogix were authorized, ordered and done by the Individual Defendants as weJI



therefore. acts and omissions for which Guestlogix is vicariously liable.

- 19 -

STATUTORY SECONDARY MARKET LIABILITY -PART XXIII.1 OF THE OSA

46. The Plaintiff will seek leave under s. 138.8( I) of the OSA to assert the causes of action set



DAMAGES

47. As a result of the conduct of the Defendants as alleged, Bodnarchuk and each other Class

A Member suffered losses and damages as a result of acquiring Guestlogix's securities at

artificially inflated prices on or after June 8, 20 I 5, and holding some or all of those securities after





this action.


Member suffered losses and damages as a result of acquiring Guestlogix' s securities prior June 8,

2015, and holding some or all of those securities after June 8, 20 I 5. Therefore, the Defendants are





-20-





51. The Plaintiffs plead and rely upon the CJA, the CPA, NI 51-102, NI 52-109, the OSA, and


May 24, 2016






Court File No. CV -16-545118-00CP




MORGANTI LEGAL Lawyers One Yonge Street, Suite 1506 Toronto, ON MSE IES

Andrew J. Morganti (LSUC# 57895E) Tel: (647) 344-1900 Ext. 1 E-mail: [email protected]


EXHIBIT ''E''

Court F'de No. CV-16-11281-ooCL

ONTARIO SUPERIOR COURT OF .JUSTICE

COMMERCIAL UST

IN THE MAITER OF THE COMPANIES' CREDITORS ARRANGEMENT ACT, R.S.C. 1985, c. C-36, AS AMENDED

AND INTIIE MATIER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. AND GUFSI'LOGIX

IRELAND LIMITED (the "Applicants")

PROOF OF CLAJM

Please read carefully the enclosed Instruction Letter for completing this Proof of Claim form. Capitalized terms not defined within this Proof of Claim form shall have the meaning ascribed thereto in the Order of the Superior Court of Justice Commercial List dated April 29, 2016, as may be amended from time to time (the "Claims Procedure Order").



Web ObJect,ve Inc., a member of Class "B" as that term is defined in the proposed Fresh as Amended Statement of Claim m Ontario Superior Court File No. CV-16-545118 attached hereto and marked as Exhibit "B" to Annex "A"




(4) E-mail Address:

(s) Facsimile Number:


c/o Morganti Legal

1 Yonge St, Suite 1506 -----Toronto ON M5E1 E5

(647) 344-1900 Ext. 4

[email protected]

(416) 352-7638

Benjamin Tinholt


oYes ~No

B. PARTICULARS OF ASSJGNHE(S) (IF APPUCABLE)

If the Claim set out herein has been sold, traneferred or assigned, complete the required i,iforrnation set out below. If there is more than one assignee, please attach a separate sheet that contains all of the required i,iformation set out below for each assignee.




(4) Email Address:



C. PROOF OF CI.AIM:

n/a

nm UNDERSIGNED HEREBY CER'OFIE'S AS FOU..OWS:

(a) Thatl: c am a Claimant of one or more of the applicants; OR

of

D1recto,_r -----(state position or title)

Web Objective Inc.

(name of Claimant)




r- AppHcant(a) I

~ Guestl.ogix Inc.

r- GuestLogix Ireland Limited

-----

_______________ ,, --------(i)Amount

ofClaim Outstanding

uat Pebruary9,

2.016

Tobe sascertained

s

(11) Amount of (iii) Total Secured Restructarlng Claim (Sum

Claim of (l) and (Ii)

I ' s s

Unsecured

!..x

r-l

Note: For the purpose of the Claims Procedure Order only ( and without prejudice to the terms of any plan of arrangement or compromise that may be.filed by the Applicant(s)), Claims will be converted to United States dollars at the Banlc of Canada noon spot rate as at the Filing Date. T1te ex.change rate conversion on such date was:

r1 CAD $1,3820 - US$1.oo o GBP - $0.6902 - US$1.oo o EUR - $0.8836 - US$1.oo

D. NATURE OF CLAIM - Complete ONLY if you are asserting a Secured Qaim

(CHECK AND COMPLETEAPPROPRIATECAmGORl?

Applicant:

Secured Claim of $. _____________ _


In respect of this debt. I hold security over the assets of the Applicant(s) valued at

$ ___________ _ (Original currency and amount)


Unsecured Claim of $ _____________ _


Givejull particulars of the security, including the date on which the security was given the value which you ascribe to the assets charged by your security, the basis/or such valuation and attach a copy of the security documents evidencing the security.

If you are asserting multiple secured claims, against one or more of the Applicants, please provide full details of your security against each of the Applicants.

E. PARncu1..A'JbfOF CIJuM:

Other than as already set out herein, the particulars of the undersigned's total Claim against the Applicant{s) are attached on a separate sheet. see Annex "A"

Provide all particulars of the Claim and supporting documentation that you feel will assist in the determination of your Claim. At a mini~ r,ou are required to provide the invoice date, invoice number, the ammmtof each outstanding invoice and the related purcltase order number. Further particulars may include the following if applicable: a description of the transaction(s) or agreement(s) giving rise to the Claim; contractual rate of interest (if applicable); name of any guarantor which has guaranteed the Claim; details of all credits, discounts, etc. claimed; description of the security if any, granted by the affected Applicant(s) to the Claimant, the estimated value of such security and the basis for such valuation; and the particulars of any Restructuring Claim.

F. PROOF OF CLAIM - CLAIM AGAINST nm DIRECTORS AND OFFICER.(S)

THIS SECl'ION SHOULD ONLY BE CQMPLRTED BYA CLAIMANTASSER.TINGA CLAIM AGAJNSTTHE DIRECl'QR{S) AND OFFICER{Sl OF TIIEAPPUCANT(Sl. A CLAJMANTASSERTINGA CLAIM ONLY AGAINST '.fflEAPPUCAN'fCSl SHOULD NOT CQMPLETBTHIS SECllQN.

mE UNDERSIGNED HBRBBY CER11FIES AS FOU.OWS:

{a) That I:

t 1 am a Claimant of one or more of the applicants, QR.

of

Director


Web ObJective Inc

(name of Claimant)

(b) I assert a claim against the following Director(s) and Officer{s) (please list below the individual Directors or Officers:

Patrick Leung

Brett Proud


{d) The Director(s} and Officer(s) was and still is indebted to the Claimant as follows in respect of a D&O Prefiling Claim arising prior to February 9, 2016 {claims should be filed in the currency of the transaction):

$ To be ascertained --------------(Original currency)

(e) The Director(s) and Officer(s) was and still is indebted to the Claimant as follows in respect of a D&O Restructuring Claim arising on or after February 9, 2016 (claims should be filed in the currency of the transactions): $. _____________ _

(Original Currency)

G. FILING OF CLAIM:

This Proof of Claim form must be returned to and received by the Monitor by no later than 5:00 p.m. (Eastern 1ime) on June 2, 2016 (the "Prefiling Claims Bar Date"),

unless a Restructuring Claim. is being 8.!Rrted in which case the Proof of Claim form related








PricewaterhoaseCoopers Inc., Monitor of GuestLogix Inc. and GuestLogix Ireland Limited PwCTower 18 York Street, Suite 2600 Toronto ON MSJ 0B2


DATEDthis ~/ ~1 dayof 'W "1· __ __,2016. l o..A _.... _-~ Per:_---=~~~'!___-_ w~ (Signature}

Benjamin Tinholt If Claimant is a Corporation, print name and title of authorized signatory:

Tom Douramakos J.llarne:~~~~~~~~~~~~~

Title: Director, Web ObJect1ve Inc




COMMERCIAL LIST



(the "Applicants")

AFFIDAVIT OF TOM DOURAMAKOS

ANNEX "A" TO PROOF OF CLAIM OF WEB OBJECTIVE INC., A MEMBER OF THE PUTATIVE CLASS IN THE CLASS PROCEEDING ENTITLED CELINE TACNIERE V.

GUESTLOGIX INC., ET AL., CV-16-S45118-00CP

I, TOM DOURAMAKOS, of the City of Toronto, in the Province of Ontario, MAKE

OATH AND SAY AS FOLLOWS:

1. I am a director of Web Objective Inc., an Ontario corporation that is a shareholder of

Guestlogix Inc. ("Guestlogix"). As of June 8, 2015, Web Objective Inc. held 9,248,081

shares of Guestlogix.





of Justice (File No. CV-16-545118) against Guestlogix and others (the ''Tacniere Action")



- 2 -


Attached as Exhibit "A" to this Affidavit is a copy of the statement of claim in the Tacniere

Action.



all similarly situated investors who purchased shares ofGuestlogix during the Class Period.













Guestlogix's securities prior to June 8, 2015, and who held their securities after June 8,

2015 (i.e. "holders' claims"), defined as "Class B" in the Fresh as Amended Claim. I

understand that Web Objective Inc. is a member of the proposed Class B.

8. Attached as Exhibit "B" to this Affidavit is a copy of the Fresh as Amended Claim.

SWORN before me at the City of ) Toronto~ in the Province of Ontario, ) this ~/Sr day of May, 2016. )

~~! A Commissioner for taking Affidavits ) for Ontario )

-3-

TOM DOURAMAKOS

"d ft This is Exhibit refened t.o in the affidavitof •• iOM OiJv/'J.IIMA-/l~;.. .. sworn before me, this .. 3 ( 1.i .......... .

:::~L 8MJamln D. Tlnholt

BETWEEN.

Court File No.:

ONTARIO SUPERJOR COURT OF JUSTICE

CELINE TACNIERE,

Plaintiff and

,;~kSTLOGIX INC., BRETT PROUD, PATRICK LEUNG, and NATIONAL 1

BANK FINANCIAL, INC.,


STATEMENT OF CLAIM

TO THE DEFENDANTS:

Defendants


IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Fonn 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiffs lawyers or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and file it, with proof of service in this court office, WlTHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.

If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is forty days. If you arc sel'ved outside Canada and the United States of America, the period is sjxty days.

Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in Fonn l8B prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within which to serve and tile your statement of defence.

IF YOU FAIL TO DEFEND THJS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU TN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. lF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY DE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE.

IF YOU PAY THE PLAINTIFF'S CLAIM, and $5,000.00 for costs, within the time for serving and filing your statement of defence you may move to have this proceeding dismissed by the court. Jf you believe the amount claimed for costs is excessive, you may pay the plaintiff's claim and $400.00 for costs and have the costs assessed by the court.

TAKE NOTJCE: THIS ACTION WJLL AUTOMATICALLY BE DISMISSED ifit has not been set down for trial or tenninated by any means within five years after the action was commenced unless otherwise ordered by the court.

Date:

TO: GUESTLOGIX INC 111 Peter Street, Suite 302 Toronto, ON MSV 2Hl



AND TO: NATIONAL BANK FINANCIAL, INC. 130 King Street West, Suite 3200 Toronto, ON MSX IJ9

Issued by:

Loc:al Re~trar ·,t·w;;-·-----Address of Court u}flce:· . 393 University Avenue, l01h Floor Toronto, ON M5G I E6

2

DEFINED TERMS

I. In addition 10 the terms defined in ss. I ( I J and 138. I of the ,\ecurilies Ac!, R.S.O. 1990, c.

S. 5, and dsewhcre herein, the following tenllS used throughout this Statement or Claim have the

llll!anings indicated bdow:

(a} "AIF" means Aunual I11forrna1ion Fonn, as dctint:d in NI 51-102:

(b) "Class'' or "Class Members'' meuns all persons, other than Excluded Pcrs@s,

who acquired Gucstlogix's securities during the Class Period and who held stime


(c) .. Class Pel'iod" means the period from and including March 24, ::O 14 to and

iududing November 12, 2015;

{d) ··<.:orn•ctiw Disclosures" me,ms the information corn;ernmg Guesllogix ·s

business, finances, and operations published on November 12 and Dcccmhcr I 6,

2015;

{I.:) .. CJA" rncans thl'. Courts ofJus1ice Ac1, R.S.O. 1990, c. C.43, a:-. amended;

< l) .. ComJ)any" means Guc.stlogix;

(g} "Cl'A" mtans the Closs Pmteedings Act, J<JYl, S.0. 1992, c. 6, as amended;

(h) ''CSA" means tla: Canadian Securities Admmistrators:

( i) ·'EBITDA" means l'.amings before interest. taX\:S, depreciation, and amorrization;

a finam;iaJ ratio for measuring a compuny's operating performance and

phi fitabil i l y;

3

(j) "Equivalent Securities Act'' means, collectively, the Scruritit?s Act, R.S.A. 2000,

c. S-4, as amended; the Securities Act, R.S.B.C. J 996, c 418, as amended~ Th1

Securities Act, C.C.S.M. c. S50, as amended; the Sewrifies Act. S.N.B. 2004, c.

S-5.5. as amended; the Secwities Act, R.S.N.L. 1990. c S- l 3, as a111c11dcd; the

Securities Ac!, S.N. W .T. 2008, e. I 0, as amended; the Securities A.ct, R.S.N .S.

1989, c. 418, as amended; the Secul'itics Act. S Nu 200~. c. 12. as amended: the

S,·,·urities A1:/, R.S.P.E.l. I 988, c S-3.1, as amended; the Securities Ad, R.S.Q. c

V-1.1, as amended; The Securities Act, J 98ts, S.S. 1988-89, c. S-42.2, as

amended; and the Securities Act, S. Y. 2007, c. 16. as amended:

1k} "Excluded Jlersons" means Guestlog1x 's subsidiaries. affiliates, ofl1cers,

directors, senior employees, legal rerrcscntalivcs. heirs, predecessors, successors

and assif:,rnS, and any member of the Individual Defendants' families and any

entity in which auy of them has or had during the Class Period auy legal or de'

.fi.1cto i:011trolling interest;


(m) ·'Individual Defendants" means Proud and Leung;

111) ·'MD&A .. means Management's Discussion and A11alys1s, as defined in NI :, 1 ·

I02. Under NI 5l-I02, a MD&A is required to be on form 51-l02Fl. and is a

11arrntiw explanation, through the eyes ofmanagement, of how a l"t:porting issuer

perlonncd during the period cove.red by the financial statements, nnd of rlw

reporting isst1cr's financial condition and future prospects;

(o) "NBF" means National Hank financial Inc.;

(p) ·'NI 51-102" means the CS/\'s National lnstrnmcnl 51-102


Continuous

{q) "NI 52-109" means Lhe CSA's National Instrument 52-109 Cer1iricat1on of

Disclosure 111 Issuers' Annual and Interim Filings, as amended;

(r) ''Guestlogix" means Dcfon<lam Guestlogix. Inc.;

(s) ··o~:4" means the Sei:unties Act, R.S.O. 191)0 c. S.S. as amended:

(t) "Plaintiff' means Celine Tacnierc;

(ti) "Prospectus" means Gucstlogix's final short form prospectus pubfo;hcd on



million wnvcrliblc urnwcured subordinaled debentures, and a privart.: placement

or 10,479,000 suhsciiption receipts;

(v) ·'SEDAR" means the CSA's System for Electronic Document Analysis and

Hetric.:val; and

( w) "TSX'' means I.he Toronto Stock Exchange.

5

»:UJ .. IEF CLAIMED

') The Plaintiff claims on her own behalf and on behalf of the olher Class Members:

(a) An order certifying this action as a class proceeding and appointing hl!r as the

representative plaintiff for the Class, punmant to s. 5 of the CPA;

(b) /\ declaration that <lunng the Clas:-. Period the Defendants made material

misrepresentations related to the Company·s business, operations and finances, as

provided in Gucstlogix ·score documents, including within its Prospectus;

(c) A dcdarntion that NBF made a misrepresentation by omitting mmcrial facts about

certain financial covcmmts associated with Gucstlogix's December 22, 2013

revolving credit facility m the Prospectus, which were not c01Tccteli, iu whole or

in pan, until November 12,2015;



Part XXllL I of the OSA and the comparable provisions in the El1u1vaknt

Set;uritit's Acts as against Gucstlogix and the Individual Ddcndanls d'foctrvc to

the date this uction was commenced:

(c) With rcspccl to those dass members who acquired Gucstlogix 's sc:curitics in the

sec1mdary market, an order granting leave to pursue the causes of action set out in

Pa11 XXll 1.1. Section l 38.3( I)( e) of the OSA und the comparable provisions in the

Equ1vaknt Se<.:urities Acts as agaim,t NBf effective to the date this act1011 was

cornmcm:cd;

(f) A declaration that the Dcfondants made these misrepresentations negligently or


(g) A declaration that the Del<.~ndauts foiled ro make full, true. and plain disclosure in


(h) A declaration that the Defendants breached s. 56 of the OSA :met OH.' comparahl~·

provi~ions in the Equivalent Sccuritie:- Acts;



(j) A declaration that Guestlogix is vicariously liable for the acts and omissions of

the Individual Dcfondants;

(k) Statutory se<.:ondary market damages in the sum of $5 million plus common law


such other sum as this Court finds appropriate al the trial of the common issues or


(I) An order directing a rcforcnce or giving such other directions as may be necessary

to detenuine issues nol determined in the trial of the common issues;


129 of the CJA;

'7

(n) Costs of this action on a full indemnity scale, or in an amount that provides

substantial indemnity plus, pursuant to s. 26(9) or the CPA, the ~osts of

administering the plan of distribution of the recovery in this action: and

(o) Such forther and other relief :ts this Ho11onrable Cou11 deems just.


3. fhis securities class action relaks to the Defendants publishing core doc11mc111s and

nwkmg other statements during the Class Period, including in the Company's fiuaucial

stat<:mcnts, containing material misrepresentations because they omitted material facts about

vanous fimmcial covenants attached to two (2) difforcnl credit facilities. Additi1ma1Jy,

tiucstlogix has am1ounccd that it will restate its prior financial statements due to material

accounting errors.

4. The Plaintiff alleges that Guestlogix securities' value and price w:.is artificially intlated as

a result of the Dcfcndatlls publishing core documents and making oral statements co11tai11111g


5. On November 12. 2016, Uuestlogix announced that it was in default of two (2) separate

financial covenants wrrcsponding lo a revolving credit facility (entered into Dl:!cembcr 23. 20 I :n and a subordinated te1111 credit facility (entered inw June 5. 2015) because it had breached u

trailing EBITOA covenant. As a result of the breach, both credit facilities could bcconll' due on


~um:nt. aud the mtercst rate on the prmcipal amount of that l:redit facility rose from 12~·•• to I ))'l•o.

V .,

6. Uucstlogix never disclosed lhat there wi.:rc li11a11cial covenants conlai11cJ within thex,•

crc:dit faeili1ics linked to a trailing EBlTDA or that the interest rate for the term credit fac1hty

would increase to 18'!-,,. This news immediately caused Gucstlogix securities' pcrcciv«xl value


7. On December l<>, 2015, Gucstlogix announced that an internal review of its prior

accounting practices and revenue recognition policies concludt·d that it may be 1cquired fl)

restate its prior financial statements and that the preliminary review imiicatcd that the

restatement would be material. This news unmediatcly caused Guestlog1x securities' perceived

value and pm.·c to drop 43110 from $0.2 l 10 $0.12 pt:r share.

THE PLAINTIFF

8. Celinc Tacnierc is an individual who resides in the City of Halifax, in the Province of

Nova Scotia. On Sertember 2, 2014, the Plaintiff purchased 20,000 Guestlogix sccuritii:s and

realized :i loss by holding those securities until after the Corrective Disclosures.

nm OEl•ENDANTS

() Gucstlt>g1x is an Ontario incorporated and operated nm1pany that is engaged in tht>

provisiou of transaction-based onboar<l retail software solutions for the passenger trawl industry.

It). During the Class Period, Guestlog1x 's securities were publicly traded and were listed 011

and traded under the ticker symbol ''GXI'' on the TSX with a CUSIP identifier number 4016:!P.

There i~ also an owr-lhc-counter market for Guestlogix 's securities in the Ulltted States and 011

the Fnuikfort Stock Exchange.

11. Uucstlogix is a reporting issuer in Rriti~h Columbia, Alberta, Saskatchewan, Manitoba,

Outario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland.

Gucsl logix is also a "responsible issuer" as defined in s. 138. l of the OSA and the ~omparablc

provisions i11 the Equivalent Securities Acts.

12. Tht' OSC is (Juestlogix 's principal securities regulator in Canada. ln connection with its

~ontinuous disclosure obligations, Gucstlogix files documents on SEDAR in Canada.

13. Pursuant to NJ 5/-/02, as a reporting issuer m Ontario, Gucstlogix was required

throughout the Class Period to, inter aliu, issue and file with SEDAR:

(a) Within lO days of \he date on which a material change occurred, a material

~hange report on Fonn 51-102F3 with respect to the makrial change au<l a press

release forthwith;

(b) Withm 45 days of the end of each quarter, qumterly interim financial statements

containing all the male1ial facL<; that arose during the quarter:




(e) Within 90 dayt. of the end of its fiscal year, an Alf, including material

mformation about the company and its business at a point in time in the context of


10

14. Hrctl Proud was Gucstlogix 's former President and Chief Executive Officer dunng tht>

Class Period until September 16, 2015, when he resigned effectively immediately. During 20!4,

Proud's total compeusation was $614,907. Proud made written and oral misreprcscnta11ons to

investors during the Clai;s Period, as partit.:ularizcd herein.

15. Patrick Leung was Guestlogix 's Chief Financial Officer during the Class Period. Durm~

2014, Leung's total compensation was $356,681. Mc made written and oral misrepresentations


I 6. National Bank Financial lm:., served as Guestlogix 's lead underwriter for its L>~ce,nber

22, 2014 public offering of subscription receipts and debentures.


17. On December 23, 2013, Guesllog1x entered into a USD $4 million revolvmg cn:dil

facility with a Canadiau chartered bank. The Company's mmourn.:cmcnts did not disdosc the

matcnal lilcts about the financial covemmts <:untamed within the revolving credit facility.

18. Ou March 24, 2014, Guestlogix published its audited annual financial statcml!nls, All;,

and MD&A for fiscal 2013. These core documents did not disclose the material focb about JIK'


it must maintain a $1 million balance with the lender and have a tangible rn:t worth ur $2.6

mil hon. Spcc1fica1Jy, then: wa:-.. no disclosure that there were trailing EBlTDA ratio

n:qui1c111c11b. Jndividuul Ddendams Proud and Leung certified that there were no

misrepr~scntations. These certifications were incorrect because of lhe reasons identi!itu in the

Corr,x:tiw Disclosures.

l I

19. On May 12, 2014, Guestlogix published its QI 2014 financial results and MD&A. These

core documents did not disclose the material facts about the financial covcnanls conlained 'Nithin

the revolving credit facility. Individual Defendants Proud and Leung certified that there were no

1111srcprcsc111ations. These ccrtiikatious were im:u1rcc1 because of the n:asons identified in the

( \mcc1ive Disclosures.

20. On August I I, 2014. Gucstlogix published its Q2 2014 financial results and MD&i\.

rlicsc core documents did not disclose the material facts about the financial covcnanls contained

within tht: revolving credit facility and subordmakd term credit facility. Individual Ddcnt.lants

Proud and Leung certified that there were no misrepn:sent:nions. These ce.rtitkations were

incom;ct because of the reasons identified in the Con-e-ctive Disclosures.

21. Ou November 1. 2014, Gucsrlogix published its Q3 2014 financial results and MD&A.

Thc:sc core Jocuments did not disclose the material facts about the financial covenants contained

within the revolving credit facility and subordimtte<l km1 c.:reJi1 facility. Individual Defendants

Proud aml Leung ce11ifo:d that there were no misrepresentations. These certifications we1"L·


22. On December 17, 2014, Guestlogix published its Prospectus. with the consent of NFB.

for it~ 20 million subscription receipt ($0.95 each) and a $20 million 7% convertible unsi::cun:d

subordinated debenture ($1,000 foce value per debenture). This cure document did not disclose

1he matc.'rial facts about the financial covenants contained within the revolving credit facility.

Individual Defendants Proud and Leung cc11ificd that there were no misrcprcscntalions. These

certificmions were incorrect because of the reasons identified in the Corrective Disdosun~s.

12


underwriters earned $0.05 per subscription receipt and $45 per debenture in underwriting foes.

NBF and the syndicate undcrvvritcrs also cc11ified that there were no misrepresentations. These

certifo.:aLions were incom:ct because ofthe reasons identified in the Co1Tcctivc Disclosures.

24. On December 22, 2014, Guesllogix with the assistance of NfB :.ind Lht' syndicate

underwriters dosed the public and private offoring of subscription rcceipl"' and debentures.

25. On December 23, 2014, Gucstlogix acquired 100% of the outstanding shares of OpcnJaw

Tcdmologies Limited ( 'OpcnJaw'), an Ireland-based provider of high perfonnancc t-Rctail

Platform, e-commerce and distribution solutions to airlines, onlinc travel agencies, hotel groups


26. On March 16, 2015, Gucstlogix published its audited annual financwl statements, AIF.

and MD&A for fiscal 2014. These core documents revealed that the Company "wa!> iu brl:ach uf


agreed to an amendment of the covenant. but did not disclose the material facts about the



identified in the Com~ctive Disclosures.

27. On May 4, 2015, Gucstlogix published its QI financial results and M D&A. These core

documents did not disclose the material facts about rhe financial covenants contained within the

revolving credit facility. ln<lividual Defendants Proud and Leung certified t!mt !here wen~ uo

misrepresentations. These certifications were incorrect because of the rea:;on:; identified in the

Con-ective Disclosures.

13

28 On .lune 5, 20 I 5 Gu~stlogix entered into ll subordinat~~d term credit fact! ity with a

principal amounl of USO $7 .2 million (CAD $9 mill1011) plus associated warnmts wtth a


linancial covena11Ls contained within this term credit fru.:ility, nor did they disdosc 1har the stafcd

12'! ,, mtcrest rate would increase to 18% were the Company to deti.1ult on this credit facility.

29. Ou .l1111c 22, 1015, Gucstlogix ~)btaincd nn amendment from the bank to incn:asc the

revolving credit facility from USD $4 million to USO $7.5 million. The company did not issue

auy a111101111ccmenl co11tcmporancously disclosing the iucreast: in the credit facility, uor did n

d1sdosc the makrial facts about the financial covenants contarned within the rcv,,lving cn~dit

facility .

. )0. On August 11, 2015, Guestlogix published its Q2 financial results an<l MD&A. These

core documents did not disclose the material facts about thc financial covenants nmtmncd within

the: revolving credit hll:ili1y and subordinated term credit facility. Individual Ddcud:mts Proud

au<l Lc1mg certified that then: were no misrepresentations. They also represented that ii was their

opinion that existing cash flow and access to financing provided Gucstlogix with suftidcnt

resourn'.S 10 finance lmgoing business requirements for the ncur term. These certifications \Wll'

im:011-cct bec:.n1se of the reasons identified in the Corrcctiw Disclosun:s.

31. 011 September 16. 2015, Guestlogix published a material cllange report tha1 lndivi<lual

De fondant Proud w:rn abruptly retiring as CEO and director of the Company. No other material

facts abmn his depanurc were disclo:;cd.

32. On November 12, 2015, Ciuestlc,gix published its 03 financial rcsulb am! MD&A.

Uuestlogix a1111ou11ced that ali at September 30, 2015, it wa~ 111 br~ach of two ( 2) S(:parak

1-1

1inandal covenants t:ot-rcsponding to the revolving credit facility (entered into Dcc1:mbcr 23,

2013) and subordinated term credit facility ( cmered into June 5, 20 l S) because it had breachcd

the trailing EBITDA covenants. It further revealed that a result of the breaches, the k:ndcrs could

immcdiatdy 1,:all both loans, the subordinat<:d krm credit facility was being reclassified from

long-term tu ct1rrent debt, and the interest rate on the subordinated term credit facility mse from

l 21!1<, to l X%.

33. This Corrective Disclosure imn-1cdiatcly caused Guestlogix securities' perceived valu1.:

and pnce to drop more than 54'Y., from $0.47 LO $0.215 per share.

34. On December 16, 2015, Guestlogix announced that its new CEO had initiated an intcmal


that Gucstlogix may he required to restate its prior financial stakmcnts and that the prdmllnary

review indicated that the restatement would be matc1ial. This news immediately caused

Guestlog1x. securities· pen:e1Vt:d value and price lo drop 43% from $0.21 tu $0.12 per share.

NO STATUTORY DEFl<:NCE FOR FORWARD-LOOKING INFORMATION

3:'i. To the extent thal any ,)f th<.· disclosure documents or public statements addressed in this

Swkmcnt of Claim contamed fo1ward-looking information, some of those forward-lookmg

stat<::ments ,:onstituted rnisreprescntations because the Defendants had no reasonable bns1s l'or the

underlying assumptions on which this forward-looking infi.muation was based for the rt:asons


~6. f ur1hcr or in the alternative, to thl! ex lent that the statutory defences of sections J T::>. I and

I :rn.,1 do apply to any forward-looking statements pleaded hcrdn, Uucsllogb .. and the lmliv1dual

15


misrepresentations because at the time each of those foiward-looking statements was made,

Gucsllogix and the Individual Defont.lants knew or should have known that the particular

fo1ward-looking statements were misrepresentations for the reasons alleged herein.

37. To the extent that the statutory defences of sc.:ction 138.4 do apply to any forward-looking

statements in the e-0re document pleaded herein, the Defendants arc liable for those forward

looking statements coutai.ning the alleged misrepresentations because at the time that the

Prospectus was cc1iificd, the Defendants knew or should have known that the particular forward

looking stutements were misrepresentations for the reasons alleged herein.

THE CAUSF.S 01? ACTION ASSERTEO BY THE PLAINTIFF AND CLASS


stalutory causes of action against Defendant Guestlogix and Individual Defendants, and NBf

found at s.xiion 130(l)(a)- (d) of the OSA and the Equivalent Securities Acts.

39. The Plaintiff asserts, in her personal and a representative capacity, secondary market

statut01y causes of action against Defondant Guestlogix and Individual Defendants found at

sections J38.3(l)(a) - (c). BlU(2)(a)- (c), and section 138.3(4) of the OSA and the Equivalcnl

Sccuritit'S Acts.

40. The Plaintiff asserts, in her personal and in a representative cap.icity. secondary market

statutory causes of action against N BF found at si::ction 138.3( 1 )(e) of the OSA and the


16

THE IU:LATIONSHIP BETWEEN THE MISREPRESENTATIONS AND THE PRICE A~D VALUE OF GUF.STLOGIX'S SECURITIES

41. The pnce and value of Gucstlogix's securities were directly affected cuch time that

tiuestlogi:v. and the Individual Detendant'i communicated new material changes and material

fot:ts about Guestlogix 's business, finances, and operations, including Guesllogix 's acquisition:,.,

accounting policit...'h, revenue recognition policies, future re\'enue prospects, revenue growth

percentages, compensation of insiders and managcmcnl, and the number of Guestlogix 's issued

and outstunJing shares.

42. Guestlog1x and the individual DefondanL-; were aware at all material time:; of the effect of

Guestlog1x 's disclosures ahou1 its business, finant'.es, and operations, including Guestlogix 's

acquisitions, accounting policies, revenue recognition policies, future revenue prospects, revenm:

~rowth percentages, compensation of insiders and management, and the number of (.,ucstlogix 's

issued and outstanding shares, on the price of the Company's publicly traded ~ccurities.

Guestlogix intended that the Class Members. including the Plaintiff~ would rely upon these

disclo.c:urcs. which they did to their den·iment.

43. The disclosure docm11cnts referred to herein were tiled with SEDAR and thereby bct:ame

immediately av~tilablc to and were reproduced for inspection for the benefit of the Plaintiff and

the other Class Members, the public, financial analysts au<l the financial press through the

lmemrt and financial publications.

44. Gucstlogix routinely transmitted the documents reforrcd to herein to the financial prco;;s,

linancial analysts and certain prospective and existing shareholders of the Company.

17

45. Guestlogix regularly con11Hunicatcd with public investors and financial analvsts via

established markd 1:0111rnu111Cation mechanisms, including through regular dissemination of

m:ws releases on newswire services and through teleconferences with investors and analysts.

4(,. Gucstlogix was the subject of analysts' reports that incorporated the information in the

disclosure documents refoJTcd to herein, with the effect that any recommendation in such reports


annual lilings. and statemenL'> mad<: during the investor conference calls, which contained

misrepresentations.

47. D01ing the Class Period, Guestlogix's securities were traded on the TSX (an<l other

allcnwtivc trading platforms in Gcnnany and the United States), which is a highly etlicicnt an<l

automated market. The pncc at which Gucstlogix 's sct.:urities traded on the- TSX incorporated

the information in the disdosurc documents referred to herein, including inlc.)rmation about

Gucstlogix 's acquisitions. accounting policies, rewnue recognition policies, li.1turc revenue

prospects, revenue growth percentages, compensation of insiders and management. and the

number vf Gucstlogix 's is1med and outstanding shares.

THE VJCAIUOllS LIABIUT\' OF GUESTLOGIX INC.

48. The acts particularized and alleged in this Stalemi::nl of Claim to have been done hy

fiuestlogix were authorized, ordered and done by the Individual Defendants as well as oilier

officers, agents, employees and reprcsculativcs who were engaged in the management, direction,

control and transaction ofGuestlogix's business, finances, and operations and arc, therefore, acts

:111d orn1ssion:-. for which Guestlogix is vicariously liable.

P AR'f XXlll.1 OF THE OSA

49. On behalf of the Plaintiff and those class members who purchased Gm:stlogix's

securities, the Plaintiff will bring a motion seeking leave to amend this Statement of Claim.

pursuant to s. l 38.8( l) of the OSA to: (a) assert the causes of action set out in s. 138.3 of the OSA



DAMAGES

50. As a result of the conduct of the Defendants as alleged, the Plaintiff and each other Clas:;

Member suffered losses and damages as a result of acquiring Guestlogix ·., securities at

,trtifit:ially inflated prices on or atler March 24, 2014, and holding some or all of those securities

atler November I 2, 2015. Therefore, the Defendants are liable to pay damages to the Plamtiff



costs in accordance with the CPA, the costs of administering the plan to distribute the recovery 111

this action.

RRAL AND SUBSTANTIAL CONNECTION WITH ONTARIO

52. This action has a real and substantial connection with Ontario because. among other

things:


(h) Defendant National Bank Financial, Inc. is located within Ontario:

19

t cl l:lass Members r~·sidcm lll Onlario arquircd Guc.stlogix shares and sufli:red

damage: a11d loss; and

(d I the slum.:!:. of Gucstlogix trade on the l'SX, wtm:h 1s locatc.:d in Ontario.

RELi<:\' ANT LEGISLATION

'.i.,. The Plamtiffp!eads and relics upou the C.JA, thi.: CPA, NJ 33-105, NJ 43-/0/ NJ 4./ JOI.

NI 51-/0."\ the ,)S,1, and the Equivalent Securities Acls.

PLACE OF TRIAL

51. The Plamtiff proposes that the <.:t!rlificd common i!>:;ues be tried in the City l)r Torontn

January 25. 2016

MORGANTI LEGAL Lawv,·rs 169 ~ i11g Strct:'I Easl, 1'd Floor Torouto, ON M5A IJ4

Andrew .I. Morganti< LSlJC# 578951: l Tel: (647) 344-1900 fax: t416\ 800-2171


CELINE TACNlERE Plaintiff


Court File No.

ONTARJO SUPERIOR COURT OF JUSTICE

PROCEEDINGS COMMENCED AT TORONl

STATEMENT OF CLAIM

MORGANTI LEGAL Lawyers

i 169 King Street East, 3rd Floor Toronto, ON MSA IJ4

Andrew J. Morganti LSUC# 57895E Te]: (647)344-1900 [email protected]


,, ., This is Exhibit g reined to in the affidavit of. , 71) J,lt f>e v/2.t 11, r O $.._ sworn before me, this "S £ f _ ....... .

::.:~· ACOM==FID,\

Benjamin D. Tlnholt

Court File No.: CV -16-545118-00CP


BETWEEN:


Plaintiffs and


Defendants



TO THE DEFENDANTS:


IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Form ISA prescribed by the Rules of Civil Procedure, serve it on the plaintiffs lawyers or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and file it, with proof of service in this court office, WITHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario.



IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONT ACTING A LOCAL LEGAL AID OFFICE.

-2-


TAKE NOTICE: THIS ACTION Wll..L AUTOMATICALLY BE DISMISSED if it has not been set down for trial or terminated by any means within five years after the action was commenced unless otherwise ordered by the court.



393 University Avenue l01h Floor Toronto ON MSG 1 E6

TO: OSLER, HOSKIN, & HARCOURT LLP 100 King Street West I First Canadian Place Suite 6200, P.O. Box 50 Toronto ON M5X I BS



AND TO: STOCKWOODS LLP BARRISTERS TD North Tower 77 King Street West Suite 4130, P.O. Box 140 Toronto ON M5K IH 1



- 3 -

DEFINED TERMS

I. In addition to the terms defined in ss. 1(1) and 138.1 of the Securities Act, R.S.O. 1990, c.



(a) "AIF' means Annual Information Form, as defined in NI 51-102;






( e) "Class B" or "Class B Members" means all persons, other than Excluded Persons,



(f) "Class Members" means, collectively, the Class A Members and Class B

Members;


November 12, 2015;




-4-

G) "Company" means Guestlogix Inc.;




(I) "CPA" means the Class Proceedings Act, 1992, S.O. 1992, c. 6, as amended;


Credit Facility.





profitability;



Securities Act, C.C.S.M. c. S50, as amended; the Securities Act, S.N.B. 2004, c. S-




Securities Act, R.S.P.E.I. 1988, c S-3.1, as amended; the Securities Act, R.S.Q. c

- 5 -








(s) "GAAP" means GeneraIJy Accepted Accounting Principles in Canada;





Under NI 51-102, a MD&A is required to be on Form 5 l-102FI, and is a narrative






(y) "NI 52-109" means the CSA' s National Instrument 52-109-Certification of


- 6 -


(aa) "OSA" means the Securities Act, R.S.0. 1990 c. S.5, as amended;




Retrieval;




Inc.; and



RELIEF CLAIMED


(a) An order pursuant to s. 5 of the CPA certifying this action as a class proceeding,



- 7 -


action set out in Part XXIII.1 of the OSA and the comparable provisions in the







( e) A declaration that Defendants breached s. 7 5 of the OSA and the comparable




(g) Statutory and common law_secondary market damages in the sum of $5 million or





(i) Prejudgment and post-judgment interest, compounded, or pursuant toss. 128 and

129 of the CJA;

-8-

G) Costs of this action on a full indemnity scale, or in an amount that provides














(i.e. Class B).






- 9 -



due on demand by the lenders; the Yistara Credit Facility was reclassified from long-term to


12% to 18%.












THE PLAINTIFFS




- 10-




THE DEFENDANTS




listed on and traded under the ticker symbol "GXI'' on the TSX with a CUSIP identifier number











- 11 -

(a) within JO days of the date on which a material change occurred, a material change


forthwith;





statements; and


about the company and its business at a point in time in the context of its historical









- 12 -


















$3,500,000 $3,250,000


- 13 -

20. On May 4, 2015, Guestlogix published its Q 1 financial results and MD&A. These core


amendments to the Comerica Credit Facility: Individual Defendants Proud and Leung certified






Guestlogix must:

(m]aintain minimum EBITDA calculated on a consolidated basis for the Borrower of not less than

(I) US $2,000,000 for the Fiscal Quarter ending June 30, 2015; (2) US $3,000,000 for the Fiscal Quarter ending September 30, 2015; and (3) US $3,600,000 for each two Fiscal Quarter period ending December 31,









- 14-




25. Bodnarchuk and the Class A Members purchased Ouestlogix's securities without the



Ouestlogix' s securities.

26. On June 22, 2015, Ouestlogix obtained an amendment from Comerica whereby the

maximum principal of the Comerica Credit Facility was increased from USO $4 million to USO

$7.5 million. Ouestlogix did not issue any announcement contemporaneously disclosing this






28. Bodnarchuk and the Class A Members purchased Ouestlogix securities without the benefit


upon Ouestlogix's documents which contained the misrepresentation in continuing to hold

GuestJogix's securities.



- 15 -



30. On September 16, 2015, Guestlogix published a Form 5l-l02F3-Material Change Report







further revealed that as a result of these breaches, the lenders could immediately call both loans,



32. This Corrective DiscJosure immediately caused Guestlogix securities' perceived value and







- 16-







35. Further or in the alternative, to the extent that the statutory defences in sections 132.I and


liable for those forward-looking statements containing the alJeged misrepresentations because, at



alleged herein.



statutory causes of action contained in_sections 138.3(l)(a) - (c), 138.3(2)(a) - (c), and 138.3(4)


37. Tacniere asserts, in her personal capacity and on behalf of Class B. secondary market

common law causes of action. Specifically, she asserts, in her personal capacity and on behalf.of



- 17 -

facts about Guestlogix 's business, operations and capital structure, and, as a result, she would have





and operations, including Guestlogix's acquisitions, accounting policies, revenue recognition


management, and the number of Guestlogix' s issued and outstanding shares.




compensation of insiders and management, and the number of Guestlogix 's issued and outstanding



detriment.







- 18 -








misrepresentations.














- 19 -

STATUTORY SECONDARY MARKET LIABILITY - PART XXIII.1 OF THE OSA

46. The Plaintiff will seek leave under s. 138.8(1) of the OSA to assert the causes of action set



DAMAGES

4 7. As a result of the conduct of the Defendants as alJeged, Bodnarchuk and each other Class

A Member suffered losses and damages as a result of acquiring Guestlogix 's securities at






this action.



2015, and holding some or all of those securities after June 8, 2015. Therefore, the Defendants arc





-20-





51. The Plaintiffs plead and rely upon the CJA, the CPA. NI 51-102, NI 52-109, the OSA, and


May 24, 2016






Court File No. CV-16-545118-00CP





Andrew J. Morganti (LSUC# 57895E) Tel: (647) 344-1900 Ext. I E-mail: [email protected]


EXHIBIT ''F''

NOTICE OF REVISION OR DISALLOWANCE FOR VOTING AND/OR DISTRIBUTION PURPOSES

FOR THE CLAIMS PROCEDURE FOR GUESTLOGIX INC. AND GUESTLOGIX IRELAND LIMITED

(collectively, the "Applicants")

and

THEIR FORMER AND CURRENT DIRECTORS AND OFFICERS

TO: Celine Tacnieri, on behalf of Class B Members as that term is defined in the pending Fresh as Amended Statement of Claim in Ontario Court File No. CV-16-545118-ooCP attached hereto and marked as Exhibit "B" to Annex "A". c/o Morganti Legal, 1 Yonge Str, Ste 1506 Toronto, ON M5E 1E5 Canada

Attention: Benjamin Tinholt


Capitalized terms not defined within this Notice of Revision or Disallowance shall have the

meaning ascribed thereto in the order of the Ontario Superior Court of Justice Commercial List

dated April 29, 2016 (the "Claims Procedure Order"). All dollar values contained herein

are in United States dollars unless otherwise noted.

Pursuant to paragraphs 23 to 25 of the Claims Procedure Order, PricewaterhouseCoopers Inc., in

its capacity as Monitor of the Applicants, hereby gives you notice that the Monitor, with the

assistance of the Applicants, has reviewed your Proof of Claim and has revised or disallowed your

Claim in whole or in part. Subject to further dispute by you in accordance with the Claims

Procedure Order, your Claim will be allowed or disallowed as follows:

(i) GuestLogix Inc.

Unsecured Claim

Secured Claim Restructuring Claim

Proof of Claim Amount:

us $ 3,617,945.00 CDN $ (5,000,000.00) $ $

Amount Allowed by Monitor: · US$o CDN$o $ $

(ii) GuestLogix Ireland Limited

Unsecured Claim Secured Claim Restructuring Claim

(iii) D&O Claim


$ ________ _ $ ________ _ $ ________ _


D&O Prefiling Claim US $ 3,617,945.00 CON$ (5,000,000.00)

D&O Restructuring $ ________ _ Claim

Amount Allowed by Monitor:

$ ______ _ $ ________ _

$--'--------


US$o CDN$o

$ ________ _

REASON(S) FOR THE REVISION OR DISALLOWANCE:

Your Claim represents an equity claim as such term is defined in the Companies' Creditors Arrangement Act.

As currently the funds available for distribution are not sufficient to pay all Claims that are not equity claims in full in these proceedings, there are not currently funds available for any distributions to be made to the Claimants on account of equity claims. As such, the Applicants and the Monitor are not quantifying any equity claims at this time.

Further, the Applicants and the Monitor were not able to quantify your Claim based on the information provided in your Proof of Claim.

SERVICE OF NOTICES OF DISPUTE

If you intend to dispute this Notice of Revision or Disallowance, you must deliver to the

Applicants, with a copy to the Monitor, a Notice of Dispute (in the form enclosed) by 5:00 p.m.

(Eastern Time) on June 30, 2016 with respect to a Prefiling Claim and by the later

of 5:00 p.m. (Eastern Time) on June 30, 2016 or 5:00 p.m. (Eastern Time) on the

day that is 14 days following the date of issuance of the Notice of Revision or

Disallowance with respect to a Restructuring Claim or a D&O Claim, either by regular

mail, prepaid registered mail, personal delivery, courier, electronic .communication or facsimile

to the following address, setting out the reasons for the dispute.

2

In accordance with the Claims Procedure Order, notices are deemed to have been received on the

date of actual receipt thereof during normal business hours on a Business Day or if delivered

outside of normal business hours, on the next Business D.ay.

Notices of Dispute must be sent to the Applicants, with a copy to the Monitor:

GuestLogix Inc. and GuestLogix Ireland Limited c/ o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre, Toronto, Ontario M5K 1K7 Attention: Robert Thornton and Rebecca Kennedy


PricewaterhouseCoopers Inc., Monitor of GuestLogix Inc. and GuestLogix Ireland Limited PwCTower 18 York Street, Suite 2600 Toronto ON MsJ 0B2


IF YOU FAIL TO FILE YOUR DISPUTE NOTICE BY 5:00 P .M. (EASTERN TIME) ON JUNE 30, 2016 with respect to a Prefiling Claim or by the later of 5:00 p.m. (Eastern Time) on June 30, 2016 or 5:00 p.m. (Eastern Time) on the day that is 14 days following the date ofissuance ofthe Notice of Revision or Disallowance with respect to a Restructuring Claim or a D&O Claim, THE VALUE OF YOUR CLAIM WILL BE · DEEMED TO BE ACCEPTED AS FINAL AND BINDING AS SET OUT IN THIS NOTICE OF REVISION OR DISALLOWANCE. .

DATED this 16th day of June, 2016.

PricewaterhouseCoopers Inc. in its capacity as court-appointed Monitor of GuestLogix Inc. and GuestLogix Ireland Limited and not in its personal or corporate capacity.

Greg Prince Chairman, President and Secretary

3

EXHIBIT ''G''

NOTICE OF REVISION OR DISALLOWANCE FOR VOTING AND/OR DISTRIBUflON PURPOSES


(collectively, the "Applicants") ·

and


TO: · Alex M. Bodnarchuk, on behalf of the Class A Members as that term is defined in the pending Fresh as Amended Statement of Claim in Ontario Court File No. CV-16-545118-ooCP attached hereto and marked as Exhibit "B" to Annex "A". cf o Morganti Legal, 1 Yonge Str, Ste 1506 Toronto, ON M5E 1E5 Canada


Email: .btinhol [email protected]



dated April 29, 20_16 (the "Claims Procedure Order"). All dollar values contained herein




~1ssistance of the Applicants, has reviewed your Proof of Claim and has revised or disallowed your



{i) GuestLogix Inc.

Unsecured Claim



us$ 3,617,945.00 CDN $ (5,000,000.00) $ $

Amount Allowed by Monitor: US$o CDN$o $ $

1

(ii) GuestLogix Ireland limited


(iii) D&O Claim


$ ________ _ $ ________ _ $ ________ _


D&O Prefiling Claim US$ 3,617,945.00 CDN $ (5,000,000.00)

D&O Restructuring $ ________ _ Claim


$ ________ _ $ ________ _ $ ________ _


US$o CDN$o

$ ________ _












mail, prepaid registered mail, personal delivery, courier, electronic communication or facsimile


2



outside of normal business hours, on the next Business Day.


GnestLogix Inc. and GuestLogix Ireland Limited c/ o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre, Toronto, Ontario M5K 1K7 Attention: Robert Thornton and Rebecca Kennedy


PricewaterhouseCoopers Inc., Monitor of GuestLogix Inc. and GuestLogix Ireland Limited· PwCTower 18 York Street, Suite 2600 Toronto ON MsJ 0B2

Attention: Tammy M uradova Email: [email protected] · Telephone: +1 416 687 8238 Fax: (416) 814-3219

IF YOU FAIL TO FILE YOUR DISPUTE NOTICE BY 5:00 P.M. (EASTERN TIME) ON JUNE 30, 2016 with respect to a Preti.ling Claim or by the later of 5:00 p.m. (Eastern Time) on June 30, 2016 or 5:00 p.m. (Eastern Time) on the day that is 14 days following the date ofissuance of the Notice of Revision or Disallowance with respect to a Restructuring Claim or a D&O Claim, THE VALUE OF YOUR CLAIM WILL BE DEEMED TO BE ACCEPTED AS FINAL AND BINDING AS SET OUT IN THIS NOTICE OF REVISION OR DISALLOWANCE.




3

EXHIBIT ''H''




and


TO: Harrington Global Opportunities Fund S. a.r.l., a member of Class "B" as that term is defined in the proposed Fresh as Amended Statement of Claim in Ontario Superior Court File No. CV-16-545118 attached hereto and marked as Exhibit "B" to Annex "A". c/ o Morganti Legal, 1 Yonge Str, Ste 1506 Toronto, ON M5E 1E5 Canada


Email: btinholt:@morgantilegal.com



dated April 29, 2016 ( the "Claims Procedure Order"). All dollar values contained herein







(i) GuestLogix Inc.


Unsecured Claim To be ascertained

Secured Claim $ ~-----------Rest ru ct u ring Claim $ ------------


(ii) GuestLogix Ireland limited


(iii) D&O Claim

D&O Prefiling Claim D&O Restructuring Claim


$ ________ _ $ ________ _ $ ________ _


$ To be ascertained $ ________ _


$ ________ _ $ ________ _ $ ________ _


$ 0 $ ________ _



As currently the funds available for distribution are not sufficient to pay all Claims that are not equity claims in full in these proceedings, there are not currently funds available for any distributions to he made to the Claimants on account of equity claims. As such,_ the Applicants and the Monitor are not quantifying any equity claims at this time.














2

Notices of Dispute must be sent to the Appl~cants, with a copy to the Monitor:

GuestLogix Inc. and GuestLogix Ireland Limited c/o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre, Toronto, Ontario M5K 1K7 Attention: Robert Thornton and Rebecca Kennedy




IF YOU FAIL TO FILE YOUR DISPUTE NOTICE BY 5:00 P.M. {EASTERN TIME) ON JUNE 30, 2016 with respect to a Preti.ling Claim or by the later of 5:00 p.m. (Eastern Time) on June 30, 2016 or 5:00 p.m. (Eastern Time) on the day that is 14 days following the date ofissuance of the Notice of Revision or Disallowance with respect to a Restructuring Claim or a D&O Claim, THE VALUE OF YOUR CLAIM WILL BE DEEMED TO BE ACCEPTED AS FINAL AND BINDING AS SET OUT IN THIS NOTICE. OF REVISION OR DISALLOWANCE.




3

EXHIBIT ''I''




and


TO: Web Objective Inc. a member of Class "B" as that term is defined in the proposed Fresh as Amended Statement of Claim in Onat:io Superior Court File No. CV-16-545118 attached hereto and marked as Exhibit "B" to Annex "A". c/o Morganti Legal, 1 Yonge Str, Ste 1506 Toronto, ON M5E 1E5 Canada





dated April 29, 2016 (the "Claims Procedure Order"). All dollar values contained herein







(i) GuestLogix Inc.


Unsecured Claim To be ascertained

Secured Claim $ ___,_ __________ _ Restructuring Claim $ --"------------


1



(iii) D&O Claim



$ ________ _ $ ________ _ $ ________ _


$_Tobe ascertained $ ________ _


$ ________ _ $ ________ _ $ ________ _


$ 0 $ ________ _








(Eastern Time) on June 30, 2016 with respect to a Preti.ling Claim and by the later









2


GuestLogix Inc. and GuestLogix Ireland Limited c/ o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre, Toronto, Ontario MsK 1K7 Attention: Robert Thornton and Rebecca Kennedy



Attention: Tammy Muradova Email: [email protected] Telephone: + 1 416 687 8238 Fax: (416) 814-3219

IF YOU FAIL TO FILE YOUR DISPUTE NOTICE BY 5:00 P.M. (EASTERN TIME) ON JUNE 30, 2016 with respect to a Prefiling Claim or by the later of 5:00 p.m. (Eastern Time) on June 30, 2016 or 5=00 p.m. (Eastern Time) on the day that is 14 days following the date of issuance of the Notice of Revision or Disallowance with respect to a Restructuring Claim or a D&O Claim, THE VALUE OF YOUR CLAIM WILL BE DEEMED TO BE ACCEPTED AS FINAL AND BINDING AS SET OUT IN THIS NOTICE OF REVISION OR DISALLOWANCE.

DATED this 161h day of June, 2016.

PricewaterhouseCoopers Inc. in its capacity as court-appointed Monitor of GuestLogix Inc. and GuestLogix Ireland Limited and not in its personal or co orate capacity.


3

EXHIBIT '' J''

NOTICE OF DISPUTE


(collectively, the "Applicants") and

THEIR FORMER AND CURRENT DIRECTORS AND OFFICERS (collectively, the "Directors")

Name of Applicant(s) and or Directors and Officers against which a Claim is asserted:

Guestlogix Inc., Patrick Leung, and Brett Proud

A. Particular of Claimant

(1) Full Legal Name of Claimant (include trade name, if different): Celine Tacniere. on behalf of the Class B Members as that term is defined in the pending Fresh as Amended Statement of Claim in Ontario Court File No. CV-16-545118-00CP attached attached as Exhibit "B" to Annex "A" to the Proof of Claim dated May 27, 2016 and submitted May 31, 2016.

(the "creditor")


c/o Morganti Legal, 1 Yonge Street, Suite 1506, Toronto ON M5E 1 E5


(4) E-mail Address:



(647) 344-1900 Ext. 4

[email protected]

(416) 352-7638

Benjamin Tinholt

B. Particular of original Claimant from whom the Claim, if applicable:

(1) Have you acquired this claim by assignment? If Yes, if not already provided, attached documents evidencing assignment.

oYes l)i!No

(2) Full Legal Name of original creditor(s): n/a

-2-

C. Dispute of Revision or Disallowance of Claim

The creditor hereby disagrees with the value of its Claim as set out in the Notice of Revision or Disallowance and asserts a Claim as follows:

Claim Against Amount of Claim Outstanding on

or prior to February 9, 2016

Amount of Restructuring

Claim

GuestLogix $ 5 million

Inc.


D&O Claim

TOTALS

$ 5 million

The exchange rate conversion is:

~ CAD - $1.3820 - US$1.oo o GBP - $0.6902 - US$1.oo o EUR - $0.8836 - US$1.oo

REASON{S) FOR THE DISPUTE

Total Claim (in original Currency)

USD Equivalent

$ 5 million $3,617,945.01

$ 5 million $3,617,945.01

$7,235,890.02

Disallowed Amount

$ 5 million

$ 5 million

$10 million

Amount Claimed by

the Claimant

$ 5 million

$ 5 million

$10 million

(You must include a list of reasons as to why you are disputing your Claims as set out in the Notice of Revision or Disallowance).

The reasons supporting the Claimant's Claim, in law and equity, are set out in detail in the proposed

Fresh as Amended Statement of Claim which was attached as Exhibit "B" to Annex "A" to the Proof

of Claim delivered to the Monitor on May 31, 2016. The alleged inability to ascertain the exact quantum of

the Claimant's Claim and negotiate a resolution is a result of the Applicant's failure to (a) provide an opinion

about its market capitalization valuation as of June 8, 2015 (to measure damages pursuant to Part XXlll.1 of the Ontario Securities Act and (b) provide a copy of its relevant insurance policies for such claims as requested from the

Applicant on February 17, 2016.

- 3 -

SERVICE OF DISPUTE NOTICES



(Eastern lime) on June 30, 2016 with respect to Pre:filing Claims and by the later

of June 30, 2016 or 5:00 p.m. (Eastern lime) on the day that is 14 days following

the date of issuance of the Notice of Revision or Disallowance with respect to a

Restructuring Claim or a D&O Claim, either by regular mail, prepaid registered mail,

personal delivery, courier, electronic communication or facsimile to the following address,

setting out the reasons for the dispute.

In accordance with the Claims Order, notices are deemed to have been received on the date of

actual receipt thereof during normal business hours on a Business Day or if delivered outside of

normal business hours, on the next Business Day.


GuestLogix Inc. and GuestLogix Ireland Limited c/ o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre, Toronto, Ontario M5K 1K7 Attention: Robert Thornton and Rebecca Kennedy Email: [email protected]


Attention: Tammy Muradova Email: [email protected] Telephone: +1416 687 8238 Fax: (416) 814-3219

DATED this __ 27_t_h ___ day of ____ Ju_n_e _______ , 2016.

Witness Signature Morganti Legal, Per:

Name: Benjamin D. Tinholt Title: Counsel for the Proposed Class

(please print)

EXHIBIT ''K''

NOTICE OF DISPUTE







(1) Full Legal Name of Claimant (include trade name, if different): Alex M. Bodnarchuk on behalf of the Class A Members as that term is defined in the pending Fresh as Amended Statement of Claim in Ontario Court File No. CV-16-545118-00CP attached as Exhibit "B" to Annex "A" to the Proof of Claim dated May 25, 2016 and submitted May 31, 2016.

(the "creditor")


c/o Morganti Legal, 1 Yonge Street, Suite 1506, Toronto ON M5E 1E5


(4) E-mail Address:



(647) 344-1900 Ext. 4

[email protected]

(416) 352-7638

Benjamin Tinholt



oYes IKINo


-2-



Claim Against Amount of Claim Outstanding on



Claim


USD Equivalent

Disallowed Amount

Amount Claimed by

the Claimant

GuestLogix $5 million

Inc.


$5 million $3,617,945.01 $5 million $5 million

D&O Claim $5 million $5 million $3,617,945.01 $5 million $5 million

TOTALS $10 million $10 million $7,235,890.02 $10 million $10 million


il!l CAD - $1.3820 - US$1.oo o GBP - $0.6902 - US$1.oo o EUR - $0.8836 - US$1.oo

REASON(S) FOR THE DISPUTE






about its market capitalization valuation as of June 8, 2015 (to measure damages pursuant to Part XXlll.1 of the Ontario Securities Act; and (b) provide a copy of its relevant insurance policies for such claims as requested from the


- 3 -




(Eastern Time) on June 30, 2016 with respect to Prefiling Claims and by the later

of June 30, 2016 or 5:00 p.m. (Eastern Time) on the day that is 14 days following









GuestLogix Inc. and GuestLogix Ireland limited c/ o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre, Toronto, Ontario M5K 1K7 Attention: Robert Thornton and Rebecca Kennedy Email: [email protected]



DATED this __ 2_7t_h ___ day of __ J_un_e ________ , 2016.

Witness Signature Morganti Legal, per:

Name: Benjamin D. Tinholt

Title: Counsel for the proposed class A

(please print)

EXHIBIT ''L''

NOTICE OF DISPUTE







(1) Full Legal Name of Claimant (include trade name, if different): Harrington Global Opportunities Fund S.a.r.l., a member of Class "B" as that term is defined in the proposed Fresh as Amended Statement of Claim attached as Exhibit "B" to Annex "A" of the Proof of Claim dated and submitted May 31, 2016.

(the "creditor")


c/o Morganti Legal, 1 Yonge Street, Suite 1506, Toronto ON M5E 1E5


(4) E-mail Address:



(647) 344-1900 Ext. 4

[email protected]

(416) 352-7638

Benjamin Tinholt



oYes lilNo


- 2 -



Claim Against

GuestLogix Inc.


Amount of Claim Outstanding on


To be ascertained


Claim

D&O Claim To be ascertained

TOTALS To be ascertained


o CAD - $1.3820 - US$1.oo o GBP - $0.6902 - US$1.oo o EUR - $0.8836 - US$1.oo

REASON(S) FOR IBE DISPUTE


USD Equivalent

To be ascerta ned

To be asce ained

To be ascerta ned

Disallowed Amount

Amount Claimed by

the Claimant

To be ascert ined

To be ascert ned

To be ascerta ned








- 3 -

















th 27th d May DATED is_____ ay of __________ , 2016.

Witness Signature Morganti Legal per:


Title: Counsel for the proposed Class B (please print)

EXHIBIT ''M''

NOTICE OF DISPUTE







(1) Full Legal Name of Claimant (include trade name, if different): Web Objective Inc., a member of Class "B" as that term is defined in the proposed Fresh as Amended

Statement of Claim in Ontario Superior Court File No. CV-16-545118 attached as Exhibit "B" to Annex "A" to the

(the "creditor") Proof of Claim dated May 31, 2016.


c/o Morganti Legal, 1 Yonge Street, Suite 1506, Toronto ON M5E 1 ES


(4) E-mail Address:



(647) 344-1900 Ext. 4

[email protected]

(416) 352-7638

Benjamin Tinholt



oYes ~No


- 2 -



Claim Against

GuestLogix Inc.


D&OClaim

TOTALS



To be ascertaine

To be ascertaine

To be ascertained


Claim





USO Equivalent

To be ascertai ed

To be ascert ined

To be ascerta ned

Disallowed Amount

Amount Claimed by

the Claimant

To be ascertained

To be ascertained

To be ascertained








- 3 -

















DATED this __ 27_th ___ day of __ J_u_ne ________ , 2016.

Witness Signature Morganti Legal, per:


Title: Lawyers for the proposed Class "B" (please print)

EXHIBIT ''N''



COMMERCIAL LIST


AND IN THE MATTER OF A PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. AND GUESTLOGIX

IRELAND LIMITED (the "Applicants")

PROOF OF CLAIM

Please read carefully the enclosed Instruction Letter for completing this Proof of Claim form. Capitalized terms not defined within this Proof of Claim form shall have the meaning ascribed thereto in the Order of the Superior Court of Justice Commercial List dated April 29, 2016, as may be amended from time to time (the "Claims Procedure Order").



Patrick S. Leung




(4) E-mail Address:



76 Babcombe Drive

Thornhill, ON

L3T 1N1

416-564-5500

[email protected]

N/A

Patrick Leung


oYes 15!::No

B. PARTICULARS OF ASSIGNEE(S) (IF APPLICABLE)

If the Claim set out herein has been sold, transferred or assigned, complete the required information set out below. If there is more than one assignee, please attach a separate sheet that contains all of the required information set out below for each assignee.




(4) Email Address:



C. PROOF OF CLAIM:

NIA

THE UNDERSIGNED HEREBY CERTIFIBS AS FOLLOWS:

(a) That!: )(am a Claimant of one or more of the applicants; OR

oam (state position or title)


(b) That I have lmowledge of all the circumstances connected with the Claim described and set out below;



Applicant(s) (i)Amount ofClaim

Outstanding asat

February 9, 2016

(ii) Amount of (iii) Total Restructuring Claim (Sum

Claim of (i) and (ii)

Secured

)& GuestLogix $ 25,000,000+ $232,692.31 $25,232,692.31 o Inc.

D GuestLogix =$ ____ =$ ____ .,.,$ ___ _ D Ireland Limited

Unsecured

D

Note: For the purpose of the Claims Procedure Order only ( and without prejudice to the terms of any plan of arrangement or compromise that may be.filed by the Applicant(s)), Claims will be converted to United States dollars at the Bank of Canada noon spot rate as at the Filing Date. The exchange rate conversion on such date was:

o CAD - $1.3820 - US$1.oo o GBP - $0.6902 - US$1.oo o EUR- $0.8836 - US$1.oo


(CHECK AND COMPLETE APPROPRIATE CATEGORY)

Applicant:

D Secured Claim of $ ______________ _



$ ____________ ,, (Original Currency and amount)


D Unsecured Claim of $. ______________ _ (Original Currency and amount)

Give fu.ll particulars of the security, including the date on which the security was given the value which you ascribe to the assets charged by your security, the basis for such valuation and attach a copy of the security documents evidencing the security.

If you are asserting multiple secured claims, against one or more of the Applicants, please providefu.11 details of your security against each of the Applicants.


Other than as already set out herein, the particulars of the undersigned's total Claim against the Applicant(s) are attached on a separate sheet.

Provide all particulars of the Claim and supporting documentation that you feel will assist in the determination of your Claim. At a minimum, you are required to provide the invoice date, invoice number, the amount of each outstanding invoice and the related purchase order number. Further particulars may include the following if applicable: a description of the transaction(s) or agreement(s) giving rise to the Claim; contractual rate of interest (if applicable); name of any guarantor which has guaranteed the Claim; details of all credits, discounts, etc. claimed; description of the security if any, granted by the affectedApplicant(s) to the Claimant, the estimated value of such security and the basis for such valuation; and the

particulars of any Restructuring Claim. I See Schedule A for particulars, indemnification and departure agreement, and class action statement of claim


THIS SECTION SHOULD ONLY BE COMPLETED BY A CLAIMANT ASSERTING A CLAIM AGAINST THE DIRECTOR(S) AND OFFICER(S) OF THEAPPLICANf{S). A CLAIMANT ASSERTING A CLAIM ONLY AGAINST THEAPPLICANT(S) SHOULD NOT COMPLETE THIS SECTION.

THE UNDERSIGNED HEREBY CERTIFIES AS FOLLOWS:

(a) That!:

o am a Claimant of one or more of the applicants, OR

oam (state position or title)





$ ______________ _

(Original Currency)


$ _____________ _

(Original Currency)

G. FILING OF CLAIM:


5:00 p.m. (Eastern Time) on June 2, 2016 (the "Prefiling Claims Bar Date"),









PricewaterhouseCoopers Inc., Monitor of GuestLogix Inc. and GuestLogix Ireland Limited PwCTower 18 York Street, Suite 2600 Toronto ON M5J 0B2


DATED this __ 1_st ___ day of _J_un_e _______ --

i 0~a ff L.rv,.5 01-,;~ Witness Name:

Per: __ ,,__...=...:..........,,..,.~---:,...+.----(Signatu ) Pa ck S. Leuy,g

,___./ If Claimant is a Corporation, print name and title of authorized signatory:

Name: ____________ _

Title:


SCHEDULE A-PROOF OF CLAIM FOR PATRICK S. LEUNG

Claim Outstanding as at February 9, 2016 (Filing Date)

This is a contingent claim for contribution, indemnity and/or other relief over in connection with (i) the putative class action lawsuit filed by Celine Tacniere, as plaintiff (the "Plaintiff'), against GuestLogix Inc. ("GuestLogix"), Leung and others, as defendants, as amended from time to time (the "Action"), and (ii) any other claim that may be advanced against Leung arising directly or indirectly from his employment as an officer of GuestLogix (the "Future Claims"); including without limitation, indemnity for all costs incurred, and any amounts that may be determined to be owing by Leung in respect of the Action and the Future Claims.

The claim is made, among other things, pursuant to the indemnification agreement between GuestLogix Inc. and Leung made on June 17, 2013 (the "Indemnification Agreement"), paragraphs 21 and 22 of the First Amended and Restated Initial Order, and pursuant to the Negligence Act and common law.

This claim is being made in the amount of $25,000,000 plus costs, which represents a potential damages award resulting from the Action subject to revision and amendment from time to time, having regard to the fact that the Future Claims are unknown, and, in respect of the Action, Leung' s liability and the damages and compensable costs incurred by the Plaintiff and the class members remain unproven and/or unquantified, and the professional and other costs to be incurred by Leung are similarly indeterminate.

Enclosed: 1. a copy of the Statement of Claim in respect of the Action; and 2. the Indemnification Agreement.

Restructuring Claim

Leung asserts a claim of $232,692.31 (CAD) in respect of his termination of employment. A copy of his termination agreement is enclosed and the calculation is 50/52 x $242,000.

Enclosed: Termination agreement

BETWEEN:

w $!

Court File No.: C,. V- l"-51/-5118-()C)C-t'


CELINE TACNIERE,

Plaintiff and

TLOGIX INC., BRETT PROUD, PATRICK LEUNG, and NATIONAL BANK FINANCIAL, INC.,

Defendants


STATEMENT OF CLAIM

TO THE DEFENDANTS:







TAKE NOTICE: THIS ACTION WILL AUTO MA TI CALLY BE DISMISSED if it has not been set down for trial or terminated by any means within five years after the action was commenced unless otherwise ordered by the court.

Date: (h(\ U oJl:f 2£ .' '2 0 l '='

TO: GUESTLOGIX INC 111 Peter Street, Suite 302 Toronto, ON M5V 2Hl



AND TO: NATIONAL BANK FINANCIAL, INC. 130 King Street West, Suite 3200 Toronto, ON M5X 1J9


393 University Avenue, 10th Floor Toronto, ON M5G 1E6

2

DEFINED TERMS

1. In addition to the terms defined in ss. 1(1) and 138.1 of the Securities Act, R.S.0. 1990, c.

S. 5, and elsewhere herein, the following terms used throughout this Statement of Claim have the




who acquired Guestlogix's securities during the Class Period and who held some


(c) "Class Period" means the period from and including March 24, 2014 to and


(d) "Corrective Disclosures" means the information concerning Guestlogix's

business, finances, and operations published on November 12 and December 16,

2015;

(e) "CJA" means the Courts of Justice Act, R.S.0. 1990, c. C.43, as amended;

(f) "Company" means Gucstlogix;

(g) "CPA" means the Class Proceedings Act, 1992, S.O. 1992, c. 6, as amended;

(h) "CSA" means the Canadian Securities Administrators;

(i) "EBITDA" means earnings before interest, taxes, depreciation, and amortization;


profitability;

3

G) "Equivalent Securities Act" means, collectively, the Securities Act, R.S.A. 2000,


Securities Act, C.C.S.M. c. S50, as amended; the Securities Act, S.N.B. 2004, c.

S-5.5, as amended; the Securities Act, R.S.N.L. 1990, c S-13, as amended; the



Securities Act, R.S.P.E.I. 1988, c S-3.1, as amended; the Securities Act, R.S.Q. c

V-1.1, as amended; The Securities Act, 1988, S.S. 1988-89, c. S-42.2, as

amended; and the Securities Act, S.Y. 2007, c. 16, as amended;

(k) "Excluded Persons" means Guestlogix's subsidiaries, affiliates, officers,

directors, senior employees, legal representatives, heirs, predecessors, successors

and assigns, and any member of the Individual Defendants' families and any


facto controlling interest;

(l) "GAAP" means Generally Accepted Accounting Principles in Canada;

(m) "Individual Defendants" means Proud and Leung;

(n) "MD&A" means Management's Discussion and Analysis, as defined in NI 51-

102. Under NI 51-102, a MD&A is required to be on Form 51-I02Fl, and is a

narrative explanation, through the eyes of management, of how a reporting issuer

performed during the period covered by the financial statements, and of the


4


(p) "NI 51-102" means the CSA's National Instrument 51-102 - Continuous


(q) "NI 52-109" means the CSA's National Instrument 52-109 - Certification of



(s) "OSA" means the Securities Act, R.S.O. 1990 c. S.5, as amended;

(t) "Plaintiff' means Celine Tacniere;

(u) "Prospectus" means Guestlogix's final short form prospectus published on



million convertible unsecured subordinated debentures, and a private placement

of 10,479,000 subscription receipts;

(v) "SEDAR" means the CSA's System for Electronic Document Analysis and

Retrieval; and

(w) "TSX" means the Toronto Stock Exchange.

5

RELIEF CLAIMED

2. The Plaintiff claims on her own behalf and on behalf of the other Class Members:



(b) A declaration that during the Class Period the Defendants made material


provided in Guestlogix's core documents, including within its Prospectus;


certain financial covenants associated with Guestlogix's December 22, 2013

revolving credit facility in the Prospectus, which were not corrected, in whole or


( d) With respect to those class members who acquired Guestlogix' s securities in the


Part XXIII. l of the OSA and the comparable provisions in the Equivalent

Securities Acts as against Guestlogix and the Individual Defendants effective to

the date this action was commenced;

(e) With respect to those class members who acquired Guestlogix's securities in the


Part XXIII.l, Section I38.3(I)(e) of the OSA and the comparable provisions in the

6

Equivalent Securities Acts as against NBF effective to the date this action was

commenced;

(f) A declaration that the Defendants made these misrepresentations negligently or


(g) A declaration that the Defendants failed to make full, true, and plain disclosure in


(h) A declaration that the Defendants breached s. 56 of the OSA and the comparable


(i) A declaration that Defendants breached s. 75 of the OSA and the comparable


G) A declaration that Guestlogix is vicariously liable for the acts and omissions of


(k) Statutory secondary market damages in the sum of $5 million plus common law




(l) An order directing a reference or giving such other directions as may be necessary


(m) Prejudgment and post-judgment interest, compounded, or pursuant toss. 128 and

129 of the CJA;

7

(n) Costs of this action on a full indemnity scale, or in an amount that provides



( o) Such further and other relief as this Honourable Court deems just.

NATURE OF TIDS ACTION


making other statements during the Class Period, including in the Company's financial


various financial covenants attached to two (2) different credit facilities. Additionally,

Guestlogix has announced that it will restate its prior financial statements due to material

accounting errors.

4. The Plaintiff alleges that Guestlogix securities' value and price was artificially inflated as



5. On November 12, 2016, Guestlogix announced that it was in default of two (2) separate

financial covenants corresponding to a revolving credit facility (entered into December 23, 2013)

and a subordinated term credit facility (entered into June 5, 2015) because it had breached a


demand by the lender, the long-term subordinated term credit facility became reclassified to

current, and the interest rate on the principal amount of that credit facility rose from 12% to 18%.

8

6. Guestlogix never disclosed that there were financial covenants contained within these

credit facilities linked to a trailing EBITDA or that the interest rate for the term credit facility



7. On December 16, 2015, Guestlogix announced that an internal review of its prior

accounting practices and revenue recognition policies concluded that it may be required to

restate its prior financial statements and that the preliminary review indicated that the ·

restatement would be material. This news immediately caused Guestlogix securities' perceived

value and price to drop 43% from $0.21 to $0.12 per share.

THE PLAINTIFF

8. Celine Tacniere is an individual who resides in the City of Halifax, in the Province of

Nova Scotia. On September 2, 2014, the Plaintiff purchased 20,000 Guestlogix securities and


THE DEFENDANTS



10. During the Class Period, Guestlogix's securities were publicly traded and were listed on

and traded under the ticker symbol "GXI" on the TSX with a CUSIP identifier number 40163P.

There is also an over-the-counter market for Guestlogix's securities in the United States and on

the Frankfurt Stock Exchange.

9







13. Pursuant to NI 51-102, as a reporting issuer in Ontario, Guestlogix was required


(a) Within 10 days of the date on which a material change occurred, a material

change report on Form 51-102F3 with respect to the material change and a press

release forthwith;




( d) Contemporaneously with each of the above, a MD&A of each of the above


(e) Within 90 days of the end of its fiscal year, an AIF, including material

infonnation about the company and its business at a point in time in the context of


10

14. Brett Proud was Guestlogix's fonner President and Chief Executive Officer during the

Class Period until September 16, 2015, when he resigned effectively immediately. During 2014,




2014, Leung's total compensation was $356,681. He made written and oral misrepresentations


16. National Bank Financial Inc., served as Guestlogix's lead underwriter for its December

22, 2014 public offering of subscription receipts and debentures.


17. On December 23, 2013, Guestlogix entered into a USD $4 million revolving credit

facility with a Canadian chartered bank. The Company's announcements did not disclose the

material facts about the financial covenants contained within the revolving credit facility.

18. On March 24, 2014, Guestlogix published its audited annual financial statements, AIF,

and MD&A for fiscal 2013. These core documents did not disclose the material facts about the




requirements. Individual Defendants Proud and Leung certified that there were no



11

19. On May 12, 2014, Guestlogix published its Q 1 2014 financial results and MD&A. These


the revolving credit facility. Individual Defendants Proud and Leung certified that there were no



20. On August 11, 2014, Guestlogix published its Q2 2014 financial results and MD&A.


within the revolving credit facility and subordinated term credit facility. Individual Defendants



21. On November 3, 2014, Guestlogix published its Q3 2014 financial results and MD&A.


within the revolving credit facility and subordinated term credit facility. Individual Defendants



22. On December 17, 2014, Guestlogix published its Prospectus, with the consent of NFB,


subordinated debenture ($1,000 face value per debenture). This core document did not disclose

the material facts about the financial covenants contained within the revolving credit facility.



12


underwriters earned $0.05 per subscription receipt and $45 per debenture in underwriting fees.

NBF and the syndicate underwriters also certified that there were no misrepresentations. These



underwriters closed the public and private offering of subscription receipts and debentures.

25. On December 23, 2014, Guestlogix acquired 100% of the outstanding shares ofOpenJaw

Technologies Limited ('OpenJaw'), an Ireland-based provider of high performance t-Retail



26. On March 16, 2015, Guestlogix published its audited annual financial statements, AIF,


a certain financial covenant under the terms of the revolving credit facility" and that the bank had

agreed to an amendment of the covenant, but did not disclose the material facts about the

financial covenants or the amendment(s). Individual Defendants Proud and Leung certified that


identified in the Corrective Disclosures.



revolving credit facility. Individual Defendants Proud and Leung certified that there were no



13

28. On June 5, 2015 Guestlogix entered into a subordinated term credit facility with a

principal amount of USD $7.2 million (CAD $9 million) plus associated warrants with a


financial covenants contained within this term credit facility, nor did they disclose that the stated

12% interest rate would increase to 18% were the Company to default on this credit facility.

29. On June 22, 2015, Guestlogix obtained an amendment from the bank to increase the

revolving credit facility from USD $4 million to USD $7.5 million. The company did not issue

any announcement contemporaneously disclosing the increase in the credit facility, nor did it

disclose the material facts about the financial covenants contained within the revolving credit

facility.

30. On August 12, 2015, Guestlogix published its Q2 fmancial results and MD&A. These

core documents did not disclose the material facts about the fmancial covenants contained witl1in

the revolving credit facility and subordinated term credit facility. Individual Defendants Proud

and Leung certified that there were no misrepresentations. They also represented that it was their

opinion that existing cash flow and access to financing provided Guestlogix with sufficient

resources to finance ongoing business requirements for the near term. These certifications were


31. On September 16, 2015, Guestlogix published a material change report that Individual

Defendant Proud was abruptly retiring as CEO and director of the Company. No other material

facts about his departure were disclosed.


Guestlogix announced that as at September 30, 2015, it was in breach of two (2) separate

14

financial covenants corresponding to the revolving credit facility (entered into December 23,

2013) and subordinated term credit facility (entered into June 5, 2015) because it had breached

the trailing EBITDA covenants. It further revealed that a result of the breaches, the lenders could

immediately call both loans, the subordinated term credit facility was being reclassified from

long-tenn to current debt, and the interest rate on the subordinated term credit facility rose from

12% to 18%.

33. This Corrective Disclosure immediately caused Guestlogix securities' perceived value





review indicated that the restatement would be material. This news immediately caused

Guestlogix securities' perceived value and price to drop 43% from $0.21 to $0.12 per share.



Statement of Claim contained forward-looking information, some of those forward-looking

statements constituted misrepresentations because the Defendants had no reasonable basis for the



36. Further or in the alternative, to the extent that the statutory defences of sections 132.1 and

138.4 do apply to any forward-looking statements pleaded herein, Guestlogix and the Individual

15



Guestlogix and the Individual Defendants knew or should have known that the particular

forward-looking statements were misrepresentations for the reasons alleged herein.

37. To the extent that the statutory defences of section 138.4 do apply to any forward-looking



Prospectus was certified, the Defendants knew or should have known that the particular forward





found at section 130(l)(a)- (d) of the OSA and the Equivalent Securities Acts.

39. The Plaintiff asserts, in her personal and a representative capacity, secondary market


sections I38.3(l)(a) - (c), 138.3(2)(a)- (c), and section 138.3(4) of the OSA and the Equivalent

Securities Acts.

40. The Plaintiff asserts, in her personal and in a representative capacity, secondary market

statutory causes of action against NBF found at section I38.3(1)(e) of the OSA and the


16



Guestlogix and the Individual Defendants communicated new material changes and material

facts about Guestlogix's business, finances, and operations, including Guestlogix's acquisitions,


percentages, compensation of insiders and management, and the number of Guestlogix's issued


42. Guestlogix and the Individual Defendants were aware at all material times of the effect of

Guestlogix's disclosures about its business, finances, and operations, including Guestlogix's

acquisitions, accounting policies, revenue recognition policies, future revenue prospects, revenue

growth percentages, compensation of insiders and management, and the number of Guestlogix' s


Guestlogix intended that the Class Members, including the Plaintiff, would rely upon these



immediately available to and were reproduced for inspection for the benefit of the Plaintiff and

the other Class Members, the public, financial analysts and tl1e financial press through the




17


established market communication mechanisms, including through regular dissemination of

news releases on newswire services and through teleconferences with investors and analysts.



during the Class Period were based, in whole or in part, upon the news releases, interim and

annual filings, and statements made during the investor conference calls, which contained

misrepresentations.



automated market. The price at which Guestlogix's securities traded on the TSX incorporated

the infonnation in the disclosure documents referred to herein, including information about



number of Guestlogix's issued and outstanding shares.


48. The acts particularized and alleged in this Statement of Claim to have been done by

Guestlogix were authorized, ordered and done by the Individual Defendants as well as other

officers, agents, employees and representatives who were engaged in the management, direction,

control and transaction of Guestlogix's business, finances, and operations and are, therefore, acts

and omissions for which Guestlogix is vicariously liable.

18

PART XXIII.1 OF THE OSA

49. On behalf of the Plaintiff and those class members who purchased Guestlogix's


pursuant to s. 138.8(1) of the OSA to: (a) assert the causes of action set out ins. 138.3 of the OSA


138.3(1)(e) of the OSA against NBF.

DAMAGES


Member suffered losses and damages as a result of acquiring Guestlogix's securities at


after November 12, 2015. Therefore, the Defendants are liable to pay damages to the Plaintiff




this action.



things:


(b) Defendant National Bank Financial, Inc. is located within Ontario;

19

( c) Class Members resident in Ontario acquired Guestlogix shares and suffered

damage and loss; and

( d) the shares of Guestlogix trade on the TSX, which is located in Ontario.


53. The Plaintiff pleads and relies upon the CJA, the CPA, NI 33-105, NI 43-101, NI 44-101,

NI 51-102, the OSA, and the Equivalent Securities Acts.

20

PLACE OF TRIAL

51. The Plaintiff proposes that the certified common issues be tried in the City of Toronto.

January 25, 2016

MORGANTI LEGAL Lawyers 169 King Street East, 3rd Floor Toronto, ON M5A 114

Andrew J. Morganti (LSUC# 57895E) Tel: (647) 344-1900 Fax: (416) 800-2171


21

INDEMNIFICATION AGREEMENT

THIS AGREEMENT is made this 17th day of June, 2013.

BETWEEN:

GUESTLOGIX INC., a corporation amalgamated under the laws of Ontario,

(the "Corporation")

-and-

PATRICK LEUNG, of the City of Thornhill, of the Province of Ontario, Canada

(the "Individual")

WHEREAS the Individual perfonns a valuable service to the Corporation and has requested that the Corporation indemnify him against certain liabilities and expenses that he may incur in connection with his acting as director or officer of the Corporation (or as a director or officer or serving in a similar capacity of any subsidiary of the Corporation or other entity where the Individual is so serving at the Corporation's request);

AND WHEREAS, in accordance with the authorization as provided by the Business Corporations Act (Ontario), as amended from time to time (the "OBCA"), the Corporation maintains directors' and officers' liability insurance covering certain liabilities which may be incurred by its officers or directors in the performance of their obligations to the Corporation;

AND WHEREAS the Corporation desires to provide the Individual with the maximum protection permitted by applicable law against any and all liabilities the Individual may incur in his capacity as a director or officer of the Corporation or in any other capacity in which the Individual may act at the request of the Corporation;

NOW THEREFORE in consideration of the mutual covenants contained herein and other good and valuable consideration (the receipt and sufficiency of which is hereby mutually acknowledged) and in consideration of the Individual continuing to act as a director of the Corporation, the parties agree as follows:

ARTICLE I INDEMNIFICATION

1.1 Indemnity. Subject to Section 1.2, the Corporation undertakes and agrees to indemnify the Individual effective from the date the Individual was first elected or appointed as a director or officer of the Corporation (or as a director or officer or serving in a similar capacity of any subsidiary of the Corporation or any other entity where the Individual is so serving at the Corporation's request), to the fullest extent permitted by law and the articles and by-Jaws of the Corporation, as such may be amended from time to time, against all Expenses (as defined below) that the Individual may suffer or incur in respect of any Proceeding (as defined below), involving the Individual or to which the Individual is made party and which arises as a direct or indirect result of the Individual being or having been a director or officer of the Corporation (or serving or having served at the Corporation's request as a director or officer or in a similar capacity of any of the Corporation's subsidiaries or any oth~r entity), by reason of any action taken { or alleged to have been taken) by the Individual or of any

2

inaction (or alleged inaction) on the part of the Individual while acting as an officer or director of the Corporation, or by reason of the fact that the Individual is or was serving at the request of the Corporation as a director, officer, employee, partner, trustee, agent, or fiduciary ofanother corporation, partnership,joint venture, trust or other entity, including any act or thing done or not done in the Individual's capacity as director or officer of the Corporation (or as a director or officer of, or in a similar capacity for, such other entity) provided that the Individual: (a) acted honestly and in good faith with a view to the best interests of the Corporation or, as the case may be, to the best interests of the other entity for which the Individual acted as a director or officer or in a similar capacity at the Corporation's request; and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the Individual had reasonable cause to believe his conduct was lawful.

No determination in any Proceeding against the Individual by judgment, order, settlement (with or without court approval) or conviction shall, of itself, create a presumption that the Individual did not act honestly and in good faith with a view to the best interests of the Corporation (or a subsidiaiy of the Corporation or any other entity for which the Individual served at the Corporation's request as director or officer or in a similar capacity) and, with respect to any criminal action or proceeding, that the Individual did not have reasonable cause to believe his conduct was lawful. For purposes of any determination hereunder the Individual will be deemed, subject to compelling evidence to the contrary, to have acted in good faith and/or in the best interests of the Corporation. The Corporation will have the burden of establishing the absence of good faith. The knowledge and/or actions, or failure to act, of any other director, officer, agent or employee of the Corporation or any other entity will not be imputed to the Individual for purposes of determining the right to indemnification under this Agreement. The Corporation will have the burden of establishing that any Expense it wishes to challenge is not reasonable.

"Expenses" means all costs, charges, legal fees, retainers and prepaid, deposited or escrowed amounts, court costs, transcript costs, fees of experts, witness fees, travel expenses, telephone charges and other disbursements of the type customarily incurred in connection with prosecuting, defending, preparing to prosecute or def end, investigating, participating or being or preparing to be a witness in a Proceeding, and amounts actually incurred by the Individual to settle claims, actions, suits or proceedings or to satisfy judgments, fines or penalties in respect of claims, actions, suits or proceedings or any expense incurred in establishing a right to indemnification under this Agreement, the OBCA or otherwise or in defending against any claims as to which a right of indemnification is asserted hereunder by the Individual.

"Proceeding" includes any claim, action, suit, investigation, inquiry, administrative hearing, or any other actual, threatened, reasonably anticipated, pending, commenced, continuing or completed proceeding, or any appeal therefrom (whether civil, criminal, administrative or investigative and whether brought by or on behalf of the Corporation or otherwise).

1.2 Expense Advances. The Corporation will, upon request by the Individual, make advances ("Expense Advances") to the Individual of all Expenses for which the Individual seeks indemnification under this Agreement before the final disposition of the relevant Proceeding. Expense Advances may include anticipated Expenses which are expected by the Individual to be incurred within a reasonable time of the request. In connection with such requests, the Individual will provide the Corporation with a written affirmation of the Individual's good faith belief that the Individual is legally entitled to indemnification in accordance with this Agreement, along with sufficient particulars of the Expenses to be covered by the proposed Expense Advance to enable the Corporation to make an assessment of its reasonableness. The Individual 's entitlement to such Expense Advance will include those Expenses incurred in connection with any Proceeding by the Individual against the Corporation seeking an adjudication or award pursuant to this Agreement. The Corporation will make payment to the Individual within 10 days after the Corporation has received the foregoing information from the Individual. All Expense Advances for which indemnification is sought must relate to Expenses anticipated within a reasonable time of the request.

3

The Individual will repay to the Corporation all Expense Advances not actually required and will repay all Expense Advances if it is determined by a court of competent jurisdiction in a final judgment which has become non-appealable that the conditions of Section I .1 are not met. Any Expense Advances to be repaid in accordance with the foregoing will bear interest from the date of applicable final judgment at the prime rate prescribed from time to time by the Toronto Dominion Bank. If requested by the Corporation, the Individual will provide a written undertaking to the Corporation confirming the Individual 's obligations under the preceding sentence as a condition to receiving an Expense Advance.

ARTICLE II CLAIMS AND THE DEFENCE THEREOF

2.1 Notification. The Individual shall give notice to the Corporation immediately and in any event no later than 10 days after the Individual shall have been served with written notice of any claim against the Individual that may give rise to a claim of indemnification under this Agreement, provided however that the failure to so notify the Corporation shall not relieve the Corporation of any liability that the Corporation has to the Individual except to the extent that any delay in or failure to give notice as required hereby results in the forfeiture by the Corporation of substantial rights or defences. A copy of any documents which have been served upon the Individual shall accompany such notice or, where this is not feasible, be delivered to the Corporation as soon as reasonably practicable thereafter. If, at the time of the receipt of a notice of a claim pursuant to Section 2.1 hereof, the Corporation has directors', officers', employees' and/or agents' liability insurance in effect, the Corporation shall give prompt notice of such Proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Corporation shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Individual, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.

2.2 Right of Corporation to Defend. Subject to any rights of or duties to any insurer, reinsurer or other third party having liability for any claim made or brought against the Individual in respect of a Proceeding, the Corporation shall have the right, at its option, to assume, at its own expense, the control of the defence thereof, including the employment of legal counsel reasonably satisfactory to the Individual upon the delivery to the Individual of written notice of its election so to do. If the Corporation exercises the foregoing right, the Individual shall cooperate with the Corporation and make available to it all infonnation under the control of the Individual which is relevant to the claim as it shall reasonably require and as shall be within the Individual's power, but the Individual shall not be required to agree to any request for co-operation that, acting reasonably, he concludes to be contrary to his interests. If the Corporation does not exercise the foregoing right, the Individual shall keep the Corporation reasonably apprised of the progress of the defence of the claim. Legal counsel retained by the Corporation under this Section 2.2 shall be satisfactory to the Individual, acting reasonably, and shall be instructed not to initiate or participate in (without the prior written consent of the Individual) any discussions that might lead to a settlement inconsistent with Section 2. 7. After delivery of such notice and the retention of counsel by the Corporation, the Corporation shall not be liable to the Individual under this Agreement for any fees of counsel subsequently incurred by the Individual with respect to the same Proceeding except as provided for in Section 2.3.

2.3 Participation in Defence of Claim. Nothing herein shall preclude the Individual, at his sole discretion and at his expense, from employing legal counsel of his choosing to participate in the defence of any Proceeding made or brought against him or in respect of any Proceeding in which he is a witness or he is questioned or any of his actions, omissions or activities are in any way investigated, reviewed, examined in connection with or in anticipation of any actual or potential Proceeding in addition to legal counsel employed by the Corporation, provided that the Corporation shall reimburse the Individual for the fees and expenses of such additional counsel in each jurisdiction where a Proceeding is or may reasonably be expected to be brought if: (a) the Corporation and the Individual have agreed in writing to separate retention of counsel by the Individual; (b) the Corporation

4

does not promptly assume pursuant to Section 2.2 the defence of any such claim in such jurisdiction; or (c) the Individual is advised by counsel in any such jurisdiction that there is any actual or potential conflict in the Corporation's and the Individual's respective interests or that additional defences are available to the Individual which makes representation by the same counsel in such jurisdiction inappropriate or inadvisable. Any such payment for the fees and expenses of counsel for the Individual shall be treated as indemnification of the Individual hereunder and shall be subject to Sections 1.1 and 1.2 hereof. The Corporation shall indemnify the Individual for the expense of obtaining the opinion of his own legal counsel pursuant to (c) above.

2.4 Further Indemnification. The Corporation shall indemnify the Individual in respect of a Proceeding in such other circumstances as the OBCA permits or requires.

2.5 Additional Indemnification Rights: Non-Exclusivity

(l) Scoae. Notwithstanding any other provision of this Agreement, the Corporation hereby agrees to indemnify the Individual to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by other provisions of this Agreement, the OBCA, the Corporation's articles, the Corporation's by-laws or by any other statute. In the event of any change after the date of this Agreement in any applicable law, statute or rule which expands the right of a corporation to indemnify a director or officer, such changes shall, without any formality, be within the purview of the Individual's rights and the Corporation's obligations under this Agreement. In the event of any change in applicable Jaw, statute or rule which narrows the right of a corporation to indemnify a director or officer, to the extent not otherwise required by such law. statute or rule to be applied to this Agreement, such change shall have no effect on this Agreement or the parties' rights and obligations hereunder.

(2) Non-Exclusivity. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which the Individual may be entitled under the Corporation's articles, its by-laws, any other agreement by which the Corporation is bound, any vote of shareholders or a resolution of directors, the OBCA or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of the Individual under this Agreement in respect of any action taken or omitted prior to such amendment, alteration or repeal without the consent of the Individual. All rights and obligations of the Corporation and the Individual hereunder shall, except as otherwise provided by applicable law, continue in full force and effect despite the subsequent amendment or modification of the articles or bylaws of the Corporation, as such are in effect on the date hereof, and such rights and obligations shall not be affected by any such amendment or modification, any resolution of directors or shareholders of the Corporation, or by any other corporate action which conflicts with or purports to amend, modify, limit or eliminate any of the rights or obligations of the Corporation or the Individual hereunder without the consent of the Individual. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

(3) Partial Indenmification. If the Individual is entitled under any provision of this Agreement to indemnification by the Corporation for some or a portion of the Expenses, judgments, fines, penalties or settlements actually incurred by the Individual in the investigation, defence, appeal or settlement of any Proceeding, but not, however, for the total amount thereof, the Corporation

5

shall nevertheless indemnify the Individual for that portion for which the Individual is entitled to indemnification.

2.6 Indemnification Not Affected By Remuneration. Any indemnification to be made to the Individual under this Agreement shall not be affected by any remuneration that the Individual shall have received, or to which he may become entitled, at any time for acting in his capacity as a director or officer of the Corporation or for acting in such a capacity or in a similar capacity for any other entity at the Corporation's request.

2. 7 Settlement of Proceedings. The parties will act reasonably in pursuing the settlement of any Proceeding. The Corporation may not negotiate or effect a settlement of claims against the Individual without the consent of the Individual, acting reasonably. The Individual may negotiate a proposed settlement without the consent of the Corporation and the Corporation will consider in good faith in the best interests of the Corporation whether or not to consent to any such proposed settlement and will advise the Individual of its determination on a timely basis. If the Corporation advises the Individual that it does not consent to the settlement, the Individual may nonetheless effect the settlement, but the Corporation will not be liable for indemnification under this Agreement with respect to any such settlement.

2.8 Insurance. The Corporation shall obtain and maintain a policy or policies of insurance approved by the Board of Directors of the Corporation providing any or all of the directors and officers of the Corporation with coverage from insurable losses they may incur in their capacities as directors or officers of the Corporation during the period in which the Individual serves as a director or officer of the Corporation (or as a director or officer serving in a similar capacity of any subsidiary of the Corporation or any other entity where the Individual is so serving at the Corporation's request). After the Individual ceases to be a director or officer of the Corporation, the Corporation shall obtain and maintain a policy or policies of insurance approved by the Board of Directors of the Corporation on terms and with coverage limits which provide the Individual with insurance coverage which is similar in all material respects to the directors' and officers' insurance coverage provided by the Corporation to the Individual as at the date hereof, the particulars of which have been provided to the Individual, or coverage which provides enhanced overall directors' and officers• insurance coverage to the Individual. In all policies of directors' and officers' liability insurance maintained by the Corporation, the Individual shall be named as an insured in such a manner as to provide the Individual the same rights and benefits as are accorded to the most favourably insured of the directors of the Corporation. The Corporation agrees to provide notice of any material changes in the insurance coverage referred to in this Section 2.8 to the Individual. If the Corporation is sold or enters into any business combination or other transaction as a result of which the directors and officers insurance policy or policies are terminated and not replaced with a substantially similar policy equally applicable to the Individual, the Corporation will cause run off "tail" insurance to be purchased for the benefit of the Individual with substantially the same coverage for a 6-year term without any gap in coverage. The Corporation will provide to the Individual a copy of each policy of insurance providing the coverages contemplated by this Section promptly after coverage is obtained, and evidence of each annual renewal thereof, and will promptly notify the Individual if the insurer cancels, makes material changes to coverage or refuses to renew coverage (or any part of the coverage).

2.9 Exceptions. Any other provision herein to the contrary notwithstanding, pursuant to the terms of this Agreement the Corporation shall not be obligated:

(i) Claims Initiated by the Individual. to indemnify or advance Expenses to the Individual with respect to proceedings or claims initiated or brought voluntarily by the Individual and not by way of defence, except with respect to (A) the bringing of such proceeding or making of such claim has been approved by the Board of Directors of the Corporation, other than the Individual, if applicable, or (8) proceedings brought to assert, interpret, establish or enforce a right to indemnification under this Agreement, the OBCA or any other statute or law; or

6

(ii) Insured Claims. to indemnify the Individual for expenses or liabilities of any type whatsoever for which the Individual has been fully reimbursed directly by an insurance carrier under a policy of directors' and officers' liability insurance maintained by the Corporation.

2.10 Mutual Acknowledgement. Both the Corporation and the Individual acknowledge that in certain instances applicable law or public pol:cy may prohibit the Corporation from indemnifying the Individual under this Agreement or otherwise. The Individual understands and acknowledges that the Corporation has undertaken or may be required in the future to undertake with the regulatory authorities to submit the question of indemnification to a court in certain circumstances for a determination of the Corporation's right under public policy to indemnify the Individual.

2.11 Effectiveness. Nothing in this Agreement is intended to require or shall be construed as requiring the Corporation to do or fail to do any act in violation of applicable law. The Corporation's inability, pursuant to applicable Jaw or court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement.

2.12 Continuation of Indemnity. The indemnification and advancement of Expenses by the Corporation to the Individual provided for under this Agreement shall survive and continue after termination of the Individual as a director or officer of the Corporation ( or as a director or officer or serving in a similar capacity of any subsidiary of the Corporation or any other entity where the Individual is so serving at the Corporation's request) as to any acts or omissions by the Individual while serving in such capacity.

ARTICLE III NOTICES

3.1 Notice. Any notice or other communication required or permitted under this Agreement shall be deemed to have been duly given only when received by the party to whom such notice or communication is sent at the following addresses (or such other addresses as the party may specify by like notice):

( 1) in the case of the Corporation, to:

GuestLogix Inc. I 11 Peter Street Suite 302 Toronto, Ontario M5V2Hl

Attention: Facsimile:

Chief Executive Officer ( 416) 644-0082

(2) in the case of the Individual, to:

11 Laureleaf ~ f!.J ~ Thornhill, ON L3T2X2 Canada


7

ARTICLE IV GENERAL

4.1 Amendment and Assignment. This Agreement may not be amended except by a written agreement signed by both of the parties hereto. This Agreement may not be assigned by the Corporation without the prior written consent of the Individual. No supplement, modification, termination or amendment of this Agreement shall be binding unless executed in writing by all of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver.

4.2 Binding Effect. Not Exclusive .. This Agreement shall be binding upon and enure to the benefit of the Corporation and its successors and permitted assigns, including, without limitation, any successor of the Corporation by way of amalgamation , merger, consolidation and/or sale or disposition of all or substantially all of the shares or assets of the Corporation, and shall be binding upon and enure to the benefit of the Individual, his legal representatives, heirs, successors and assigns. The Corporation hereby covenants and agrees that it will not take any action, including, without limitation, the enacting, amending or repealing of any by-law, which would in any manner adversely affect or prevent the Corporation's ability to perform its obligations under this Agreement. The Corporation shall use best efforts to cause any successor (whether direct or indirect, and whether by purchase, merger, consolidation or otherwise) to all, substantially all or a substantial part of the business or assets of the Corporation, by written agreement, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Corporation would be required to perform if no such succession had taken place. The rights provided to the Individual under this Agreement shall be in addition to any indemnification that may be available to the Individual under any other agreement, the articles or bylaws of the Corporation, by law or at equity.

4.3 Continuance of Agreement. This Agreement shall continue notwithstanding that the Individual has ceased to be a director or officer of the Corporation or any other entity.

4.4 Severability. If any provision or provisions of this Agreement shall be held by a court of competent jurisdiction to be invalid, void, illegal or otherwise unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shal I remain enforceable to the fullest extent permitted by law; and (b) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

8

4.5 Governing Law, Attornment. This Agreement shall be governed by, and construed in accordance with, the laws of the Province of Ontario and the federal laws of Canada applicable therein. Subject to the arbitration provision in section 4.6, the parties hereby irrevocably submit to the non-exclusive jurisdiction of the courts of the Province of Ontario.

4.6 Arbitration. Except as otherwise required by law, all disputes, disagreements, controversies or claims arising out of or relating to this Agreement, including, without limitation, with respect to its formation, execution, validity, application, interpretation, performance, breach, termination or enforcement will be determined by arbitration before a single arbitrator in Toronto, Ontario under the Arbitration Act, 1991 (Ontario). The arbitrator will be selected by the Managing Partner of the Toronto office of the Corporation's auditors ( or, if he/she is unwilling to so act, by a court of competent jurisdiction in Toronto, Ontario) having regard to the nature of the dispute (legal, financial or other). The arbitrator will determine the rules for the arbitration, including, based on the outcome of the arbitration, the breakdown between the Corporation and the Individual of the costs for conducting the arbitration.

4.7 Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof.

4.8 Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts will for all purposes be deemed to be an original, and all such counterparts shall together constitute one and the same instrument.

4.9 Tax Adjustment. Should any payment made pursuant to this Agreement, including the payment of insurance premiums or any payment made by an insurer under an insurance policy, be deemed to constitute a taxable benefit or otherwise be or become subject to any tax or levy, then the Corporation will pay any amount necessary to ensure that the amount received by or on behalf of the Individual, after the payment of or withholding for tax, fully reimburses the Individual for the actual cost, expense or liability incurred by or on behalf of the Individual.

4.10 Survival. The obligations of the Corporation under this Agreement will continue until the later of (a) 15 years after the Individual ceases to be a director or officer of the Corporation or any other entity in which he or she serves in a similar capacity at the request of the Corporation and (b) with respect to any Proceeding commenced prior to the expiration of such 1 S~year period with respect to which the Individual is entitled to claim indemnification hereunder, one year after the final termination of that Proceeding.

4.11 Priority and Term. This Agreement will supersede any previous agreement between the Corporation and the Individual dealing with this subject matter, and will be deemed to be effective as of the date that is the earlier of (a) the date on which the Individual first became a director or officer of the Corporation; or (b) the date on which the Individual first served, at the Corporation's request, as a director or officer, or an individual acting in a capacity similar to a director or officer, of another entity.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

9

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of the date first abovewritten.

SIGNED, SEALED & DELIVERED In the presence of:

GUESTLOGIX INC.

Name: Brett Prou Title: President & CEO

PRIVATE & CONFIDENTIAL

May 18, 2016

Patrick S. Leung 76 Babcombe Drive Thornhill, ON L3T 1N1

DELIVERED BY HAND

WITHOUT PREJUDICE

Dear Patrick,

Re: End of Employment with Guestlogix Inc.

Guestlogix Inc. 111 Peter Street

Suite406 Toronto, ON M5V 2H1

Tel: (416) 642-0349 Fax: (416) 644-0082

Further to our conversation on Tuesday May 3, 2016, we confirm our mutual agreement to discontinue your employment relationship effective June 1, 2016 (the "Departure Date") with GuestLogix Inc. ("GuestLogix"} in accordance with the terms set out in this letter and conditional upon your executing and returning a copy of this letter preferably by no later than May 26, 2016.

As part of your agreed departure we have agreed to make payments to you in accordance with the amounts set out in clause S(iii) of your employment agreement dated May 22, 2013 (the "Employment Agreement") notwithstanding that your departure does not constitute termination without cause under the Employment Agreement. These payments will form a Departure Allowance equivalent to fifty-two (52) weeks' of pay. Accordingly, the period from today through until June 1, 2016 will constitute a period of transition equal to two (2) weeks. The remaining fifty (50) weeks will be due to you following the Departure Date, and will be payable to you subject to the CCM process set out below. All Company benefits will cease effective the Departure Date.

The total value of your departure entitlement is $242,000.00 CAD, less statutory deductions (the "Departure Allowance").

Notwithstanding our agreement to pay the Departure Allowance, the Company is currently protected by the Companies' Creditor Arrangement Act (the "CCAA"). Under CCM, the monies owed to you as a result of our agreement pursuant to this letter will be stayed and you will be added to the Unsecured Creditors List as posted on the PricewaterhouseCoopers' (PwC) website at http:f/www,pwc.com/ca/guestlogix. Once a financial transaction to sell some or all of the business has taken place, and/or a restructuring plan has been approved by the creditors and the Courts, the court appointed Monitor (PwC) will supervise all payments made to the unsecured creditors including you. You are encouraged to visit the PwC website frequently to stay abreast of the CCM proceedings.

In addition to the Departure Allowance noted above, we also agree to make payment to you for unused accrued vacation, the calculation of which will be completed immediately following your last day worked. You will receive payment for the un1,1sed accrued vacation on the June 15, 2016 pay date.

Your Record of Employment will be sent to you under separate cover following your last pay.

In consideration for the above, following the Departure Date, you agree to continue to cooperate and make yourself available (on being given reasonable notice) to Guestlogix or such person or persons as GuestLogix may direct in processing or responding to any and all outstanding matters involving GuestLogix (including but not limited to any lawsuits, proceedings, or internal or external investigations relating to GuestLogix or to which GuestLogix is a party).

As you are aware, currently there is a proposed action before the Company - GuestLogix Inc. (the ·"Company") et al. re: Celine Tacniere, Ontario Superior Court of Justice Court File CV-16· 545118-00CP (the "Proposed Actlon'1, to which you have been named a party. You agree that with respect to the Proposed Action, to adhere and abide by the protocols as set out in Schedule "A" attached herein.

You hereby agree to forever release and discharge GuestLogix, as well as any affiliated or related company or entity and any successors, officers, directors, employees, agents, servants and assigns of GuestLogix and of any such affiliated or related companies or entities (collectively, the "GuestLogix Releasees"), from any and all actions, causes of action, claims, complaints or demands for payment, and potential actions, causes of action, claims, complaints or demands for payment, whether at law or in equity, which you may now have, ever had or may hereafter have against the GuestLogix Releasees, by reason of any cause, matter or thing whatsoever existing at the date hereof as a result of your employment or the cessation thereof, other than any claims which may arise pursuant to the terms of this letter.

In accordance with the end of your employment you agree to resign from all Company Director and Officer positions that you currently hold. It is agreed and understood that the terms and conditions of the Indemnification Agreement between GuestLogix Inc. and you dated June 17, 2013 shall survive and exist in its original form post-employment with the Company.

Your departure does not relieve you of your obligations to GuestLogix pursuant to Section 6 of the Employment Agreement including the confidentiality obligations and non-solicitation, noncompetition, conflict of interest and non-disparagement restrictive covenants.

You acknowledge that: (a) you have carefully read and understood this letter agreement; (b) you have received adequate consideration for entering into this letter agreement; (c) you have been advised to consult with and obtain independent legal advice concerning this letter agreement and the provisions hereof and the interpretation and effect of this letter agreement, and by signing this letter agreement represent and warrant that you have either obtained such independent advice or voluntarily waived the opportunity to receive same: and (d) you have entered into this letter agreement voluntarily and of your own free will.

Prior to the close of business on June 1, 2016, you are required to return any remaining property of GuestLogix that you have in your possession including: keys and identification card, literature, software or any other documentation or property in your possession. This property should be returned to Steve Kuzmaski, SVP Human Capital.

The terms of this letter shall be governed by the laws of the Province of Ontario.

I would like to thank you for your contributions to the Company and wish you much success in the future.

Sincerely, Guestlogix Jnc.

John Gillberry Chief Executive Officer

Enclosures {i) copy of employment contract dated May 22, 2013, (ii) Indemnification Agreement dated June 17, 2013

C.c. Steve Kuzmaski

***

Acknowledgement & Agreement:

flk_··. Pafue~

EXHIBIT ''0''




and


TO: Patrick S. Leung 76 Babcombe Drive Thornhill, ON L3T 1N1 Canada




dated April 29, 2016 (the "Claims Procedure Order"). All dollar values contained

herein are in United States dollars unless otherwise noted.

Pursuant to paragraphs 23 to 25 of the Claims Procedure Order, PricewaterhouseCoopers Inc.,

in its capacity as Monitor of the Applicants, hereby gives you notice that the Monitor, with the

assistance of the Applicants, has reviewed your Proof of Claim and has revised or disallowed

your Claim in whole or in part. Subject to further dispute by you in accordance with the Claims


(i) GuestLogix Inc.

Unsecured Claim



us $ 18,089,725.00 (CDN $25,000,000.00)

us $168,373.60 (CON$ 232,692.31)

Amount Allowed by Monitor: US$o (CON$ o) $ us $ 168,373.60 CON $ 232,692.31


Proof of Claim Amount: A.mount Allowed by Monitor:

Unsecured Claim Secured C]aim Restructuring Claim

(iii) D&O Claim

$ _______ _ $ ________ _ $ _______ _ $ _______ _ $ _______ _ $ ________ _

Proof of Claim Amount: Amount Allowed by Monitor:


$ _______ _ $ _______ _


$ ________ _ $ ________ _

Pursuant to the Applicants' books and records you are owed a salary continuance in the amount of US $ 168,373.60 (CDN $232,692.31) which represents a portion of your claim and is a Restructuring Claim you have filed. This portion is allowed.

The other portion of your claim in the amount of US $18,089,725 (CDN $ 25,000,000.00) for indemnification from GuestLogix Inc. is a contingent claim.

Any D&O Claims that may arise in connection with the Action (as defined in your Proof of Claim) that have been filed against you are in respect of an equity interest.

Any Claim for indemnification in respect of such D&O Claims would represents an equity claim as such term is defined in the Companies' Creditors Arrangement Act.


Further, the Applicants and the Monitor were not able to quantify your Claims based on the information provided in your Proof of Claim other than in respect of the allowed amount of US$ 168,373.60 (CDN $ 232,692.31) described above.

SERVICE OF NOTICFS OF DISPUTE

If you intend to dispute this Notice of Revision or DisaJlowance, you must deliver to the





2


maiJ, prepaid registered mail, personal delivery, courier, electronic communication or facsimile


In accordance with the Claims Procedure Order, notices are deemed to have been received on

the date of actual receipt thereof during normal business hours on a Business Day or if delivered



GuestLogix Inc. and GuestLogix Ireland Limited c/o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P .0. Box 329, Toronto-Dominion Centre, Toronto, Ontario M5K 1K7 Attention: Robert Thornton and Rebecca Kennedy


PricewaterhouseCoopers Inc., Monitor of GuestLogix Inc. and GuestLogix Ireland Limited PwCTower 18 York Street, Suite 2600 Toronto ON M5J 0B2


IF YOU FAIL TO FILE YOUR DISPUTE NOTICE BY 5:00 P.M. (EASTERN TIME) ON JUNE 30, 2016 with respect to a Prefiling Claim or by the later of 5:00 p.m. (Eastern Time) on June 30, 2016 or 5:00 p.m. (Eastern Time) on the day that is 14 days following the date of issuance of the Notice of Revision or Disallowance with respect to a Restructuring Claim or a D&O Claim, THE VALUE OF YOUR CLAIM WILL BE DEEMED TO BE ACCEPTED AS FINAL AND BINDING AS SET OUT IN THIS NOTICE OF REVISION OR DISALLOWANCE.

DATED this 16111 day of June, 2016.



3

EXHIBIT ''P''

NOTICE OF DISPUTE






(1) Full Legal Name of Claimant (include trade name, if different):

Patrick S. Leung

(the "creditor")


76 Babcombe Drive

Thornhill, ON L3T 1N1


(4) E-mail Address:



416-564-5500

[email protected]

n/a

Patrick Leung


(1) Have you acquired this claim by assignment? If Yes, if not already pro,d.ded, attached doettments-evi-clefteing-assignffleftt.

oYes e§ No


- 2 -



Claim Against

GuestLogix Inc.


D&O Claim

TOTALS



CAD $25,000,000

CAD $25,000,000


Claim

CAD $232,692.31

CAD $232,692.31





USO Equivalent

CAD $25,232,692.31 US $18,258,098.60

CAD $25,232,692.31 US $18,258,098.60

Disallowed Amount

Amount Claimed by

the Claimant

us $18,089,725.00 us $18,089,725.00

us $18,089,725.00 us $18,089,725.00 ( see Note 1 on Appendix "A"


see Appendix "A" attached

- 3 -














GuestLogix Inc. and GuestLogix Ireland Limited c/o Thornton Grout Finnigan LLP Suite 3200, 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre, Toronto, Ontario M5K 1K7 Attention: Robert Thornton and Rebecca Kennedy Email: [email protected]



DATED this 30th day of _J_u_ne ________ , 2016.

_,~4, .. .-d /! li:t::.t?:£ -. Witness -.:?~ -Si_g_n-at_u_r_e_~, ( ~-y------

~ / '---- .

Name: Patrick S. Leung Title: (please print)

APPENDIX "A"

1. We understand the disallowance of the $25,000,000 claim to be premised firstly

upon the characterization of the claim as an equity claim. The characterization of the

claim is not relevant to its validity or its quantification (as distinct from its priority).

2. The disallowance of the $25,000,000 claim is also premised upon an alleged lack

of information. The creditor submits that sufficient information has been provided and/or

is available to the Applicants and the Monitor, having regard to the nature of the claim (a

claim for contribution and indemnity premised upon an action commenced by a third

party and defended by the creditor), and that the claim ought not to be disallowed on

this basis at this time.

Note 1. In addition, it has been brought to the creditor's attention that additional claims

have been filed against him in the course of the claim process in these proceedings for

a specific and indeterminate amount which may or may not be subsumed in the CAD

$25,000,000 claim (eg. Claims by George Douramakes, Chryssoula Aramakis, Web

Objective Inc., Alex M. Bodnarchuk and Harrington Global Opportunities Fund S.a.r.1.).

To the extent that these are in addition to the CAD $25,000,000 claim then they should

be added to this amount.


AND IN THE MATTER OF A PROPOSED PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. and GUESTLOGIX IRELAN LIMITED



(COMMERCIAL LIST)

Proceedings commenced at Toronto

AFFIDAVIT OF JOHN GILLBERRY (SWORN SEPTEMBER 7, 2016)

Thornton Grout Finnigan LLP Suite 3200, TD West Tower 100 Wellington Street West P.O. Box 329, Toronto-Dominion Centre Toronto, ON M5K 1K7



Mitch Grossell (LSUC# 69993I) Tel: (416) 304-7978 Fax: ( 416) 304-1313 Email: [email protected]



ONTARIO

SUPERIOR COURT OF JUSTICE

(COMMERCIAL LIST)

THE HONOURABLE REGIONAL SENIOR ) MONDAY, THE 12TH

DAY OF SEPTEMBER, 2016 JUSTICE MORA WETZ )

)


AND IN THE MATTER OF A PROPOSED PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC.

AND GUESTLOGIX IRELAND LIMITED

PLAN SANCTION ORDER

THIS MOTION made by GuestLogix Inc. ("GuestLogix") for an Order (the "Plan

Sanction Order"), pursuant to the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-

36, as amended (the "CCAA"), sanctioning the Plan of Compromise and Arrangement dated

July 29, 2016, which is attached as Schedule "A" hereto (and as it may be further amended,

varied or supplemented from time to time in accordance with the terms thereof, the "Plan"), was

heard on September 12, 2016 at 330 University Avenue, Toronto, Ontario.

ON READING the Notice of Motion, the Affidavit of John Gillberry sworn September

7, 2016, filed, the eighth report (the "Eighth Report") and the ninth report (the "Ninth Report")

of PricewaterhouseCoopers Inc., in its capacity as monitor of GuestLogix (the "Monitor"), filed,

and on hearing the submissions of counsel for each of GuestLogix, the Monitor, the Sponsor, and

such other counsel as were present and wished to be heard, no one else appearing although duly

served as appears from the affidavit of service, filed.

DEFINED TERMS

1. THIS COURT ORDERS that any capitalized terms not otherwise defined in this Plan

Sanction Order shall have the meanings ascribed to such terms in the Plan or the Meeting

- 2 -

Order granted by this Court on August 3, 2016 (the "Meeting Order"), as applicable,

and that any capitalized terms not otherwise defined in paragraph 18 of this Plan Sanction

Order shall have the meanings ascribed to them in the Claims Procedure Order.

SERVICE, NOTICE AND MEETING

2. THIS COURT ORDERS that the time for service of the Notice of Motion, the Motion

Record in support of this motion and the Ninth Report be and are hereby abridged and

validated so that the motion is properly returnable today and service upon any interested

party other than those parties served is hereby dispensed with.

3. THIS COURT ORDERS AND DECLARES that the Meeting was duly convened and

held on September 2, 2016 in conformity with the CCAA and the Meeting Order.

SANCTION OF THE PLAN

4. THIS COURT DECLARES that:

(a) the Plan has been approved by the Required Majority of Affected Unsecured

Creditors, as required by the Meeting Order and in conformity with the CCAA;

(b) the activities of GuestLogix have been in compliance with the provisions of the

CCAA and the Orders of this Court granted in these CCAA proceedings (the

"Orders");

( c) the Court is satisfied that GuestLogix has not done or purported to do anything

that is not authorized by the CCAA; and

( d) the Plan and the transactions contemplated thereby are fair and reasonable.

5. THIS COURT ORDERS AND DECLARES that the Plan is hereby sanctioned and

approved pursuant to section 6 of the CCAA.

- 3 -

PLAN IMPLEMENTATION

6. THIS COURT ORDERS that each of GuestLogix and the Monitor are authorized and

directed to take all steps and actions, and do all things, necessary or appropriate to

implement the Plan in accordance with its terms and to enter into, execute, deliver,

complete, implement and consummate all of the steps, transactions, distributions,

deliveries, allocations and agreements contemplated by the Plan. All payments and

distributions to be made on behalf of GuestLogix to the Affected Unsecured Creditors

pursuant to the Plan shall be made by the Monitor, and the Monitor shall allocate and

distribute such payments in accordance with the Plan. Neither GuestLogix nor the

Monitor shall incur any liability as a result of acting in accordance with the terms of the

Plan and the Plan Sanction Order.

7. THIS COURT ORDERS AND DECLARES that, on the Plan Implementation Date, the

Plan and all associated steps, compromises, transactions, arrangements, releases and

reorganizations effected thereby shall be deemed to be implemented, binding and

effective in accordance with the provisions of the Plan, and the steps required to

implement the Plan, including, without limitation, the release of all Affected Claims,

Released Director/Officer Claims and Released Claims in accordance with the terms of

the Plan, shall be deemed to occur and to take effect in the sequential order and at the

times contemplated in the Plan, without any further act or formality, beginning at the

Effective Time on the Plan Implementation Date.

8. THIS COURT ORDERS that the Monitor is hereby authorized and directed to

incorporate a new corporation ("AssetCo") pursuant to and in accordance with the Plan

and shall hold the share of AssetCo in trust for the Affected Unsecured Creditors.

9. THIS COURT ORDERS that on the Plan Implementation Date, all Transferred Assets

shall be transferred from GuestLogix to AssetCo together with any and all Encumbrances

in respect of such Transferred Assets and any and all Affected Claims in respect of the

Transferred Assets shall be fully, finally, irrevocably and forever released, waived,

discharged, cancelled and barred on the Plan Implementation Date as against GuestLogix

and the Directors and Officers pursuant to and in accordance with Section 5.3 of the Plan,

- 4 -

provided that any litigation or enforcement process against GuestLogix for a non

monetary remedy in respect of any such Transferred Assets may be continued against

(and in the name of) AssetCo (and, for greater certainty, not against GuestLogix). The

style of cause of any such litigation or enforcement process in respect of such Transferred

Assets shall be amended such that AssetCo, not GuestLogix, is the party named in the

applicable litigation or enforcement process. GuestLogix, with the consent of the

Monitor, shall be permitted to and shall transfer to AssetCo on or prior to the Plan

Implementation Date an amount sufficient to provide for the costs associated with the

liquidation and dissolution of AssetCo.

10. THIS COURT ORDERS that, from and after the Plan Implementation Date:

(a) AssetCo is a company to which the CCAA applies;

(b) AssetCo shall be added as an Applicant in these CCAA proceedings and any

reference in any Order of this Court in respect of these CCAA proceedings to an

"Applicant" or the "Applicants" shall refer to AssetCo, mutatis mutandis, and for

greater certainty, each of the Charges shall constitute a charge on the Property (as

defined in the Initial Order) of AssetCo; and

( c) the name "GuestLogix Inc." shall be deleted from the within title of proceedings

and replaced with the legal name of AssetCo.

11. THIS COURT ORDERS that the Monitor and the directors of AssetCo shall have no

liability in connection with: (i) the incorporation of AssetCo; (ii) the holding of the share

of AssetCo; (iii) any actions of AssetCo taken pursuant to, or in connection with the

implementation of, the Plan; or (iv) any assignment into bankruptcy by AssetCo pursuant

to the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended.

12. THIS COURT ORDERS that, pursuant to section 6(2) of the CCAA, the Articles of

GuestLogix shall be amended on the Plan Implementation Date in accordance with the

provisions of, and as required to implement, the Plan. Any fractional Common Shares

held by any holder of Common Shares immediately following the consolidation of the

Common Shares referred to in section 5.5(f) of the Plan shall be cancelled without any

- 5 -

liability, payment or other compensation in respect thereof and all Equity Interests (for

greater certainty, not including any Common Shares that remain issued and outstanding

immediately following the cancellation of fractional interests pursuant to section 5.5(g) of

the Plan) shall be cancelled without any liability, payment or other compensation in

respect thereof.

13. THIS COURT ORDERS that upon the satisfaction or waiver of the conditions

precedent set out in Article 8 of the Plan in accordance with the terms of the Plan, as

confirmed by the Company Advisors and the Sponsor Advisors in writing, and upon the

Monitor being satisfied that adequate provision has been made for all Restructuring

Costs, the Monitor is authorized and directed to deliver to counsel to GuestLogix and the

Sponsor a certificate substantially in the form attached hereto as Schedule "B" (the

"Monitor's Certificate") signed by the Monitor, certifying that the Plan Implementation

Date has occurred and that the Plan is effective in accordance with its terms and the terms

of the Plan Sanction Order. The Monitor shall file the Monitor's Certificate with this

Court as soon as practicable following the Plan Implementation Date.

14. THIS COURT ORDERS that, in accordance with the provisions of the Plan, each of the

Charges shall be terminated, discharged and released on the Plan Implementation Date as

against GuestLogix and all of its current and future assets, undertakings and properties of

every nature and kind whatsoever and wherever situated, including all proceeds thereof.

15. THIS COURT ORDERS that upon the delivery of the Monitor's Certificate by the

Monitor pursuant to paragraph 13 of this Plan Sanction Order: (i) this proceeding under

the CCAA shall be and is hereby terminated in respect of GuestLogix and GuestLogix

shall cease to be an Applicant in, or subject to, these CCAA proceedings; and (ii) for

greater certainty, the stay of proceedings set out in paragraphs 15, 16 and 20 of the Initial

Order in favour of GuestLogix and the Directors and Officers, as such stay of

proceedings has been amended and extended in these CCAA proceedings, is hereby

terminated.

16. THIS COURT ORDERS that sections 95 to 101 of the BIA and any other federal or

provincial law relating to preferences, fraudulent conveyances or transfers at undervalue,

- 6 -

shall not apply to the Plan or to any transactions and distributions implemented pursuant

to the Plan.

EFFECT OF PLAN AND CCAA ORDERS

17. THIS COURT ORDERS that, from and after the Plan Implementation Date, the Plan

shall inure to the benefit of and be binding upon GuestLogix, the Released Parties, the

Affected Creditors, the Directors and Officers, any Person with a Director/Officer Claim

or a Released Claim, and all other Persons and parties named or referred to in or affected

by the Plan, including, without limitation, their respective heirs, administrators,

executors, legal representatives, successors, and assigns.

18. THIS COURT ORDERS that, save and except for any Claim that the Applicants, in

consultation with the Monitor, have allowed in these CCAA proceedings, without

limiting the provisions of the Claims Procedure Order, any Person that did not file a

Proof of Claim or a Notice of Dispute, as applicable, by the Prefiling Claims Bar Date,

the Restructuring Claims Bar Date or such other bar date provided for in the Claims

Procedure Order, as applicable, whether or not such Person received direct notice of the

claims process established by the Claims Procedure Order, shall be and is hereby forever

barred from making any Claim or any Director/Officer Claim and shall not be entitled to

any consideration under the Plan, and such Person's Claim, as applicable, shall be and is

hereby forever barred and extinguished.

19. THIS COURT ORDERS AND DECLARES that, subject to the performance by

GuestLogix of its obligations under the Plan and except as provided in the Plan, all

obligations, agreements, contracts or arrangements to which GuestLogix is a party on the

Plan Implementation Date shall be and remain in full force and effect, unamended, as at

the Plan Implementation Date, and no Person, including any party thereto, shall on or

following the Plan Implementation Date, accelerate, terminate, refuse to renew, rescind,

refuse to perform or otherwise disclaim or resiliate its obligations or the interests of

GuestLogix thereunder, or enforce or exercise ( or purport to enforce or exercise) any

right or remedy (including any right to receive any change of control, assignment or

similar payment) under or in respect thereof by reason: (i) of any event that occurred

- 7 -

prior to the Plan Implementation Date; (ii) that GuestLogix was insolvent, or that

GuestLogix sought or obtained relief or took steps as part of the Plan or under the CCAA;

(iii) of any default, event of default or circumstance of non-compliance arising as a result

of the financial condition or insolvency of GuestLogix on or prior to the Plan

Implementation Date or these CCAA proceedings; (iv) of the effect upon GuestLogix of

the completion of any of the transactions approved in these CCAA proceedings or

contemplated by the Plan, including, without limitation, as a result of a change of control

of GuestLogix, or (v) of any compromises, settlements, restructurings, recapitalizations

or reorganizations effected pursuant to the Plan, including, without limitation, the

compromise of the Claim of any Person with respect to a Retained Agreement.

THE MONITOR

20. THIS COURT ORDERS that the Monitor, in addition to its prescribed rights and

obligations under the CCAA and the powers provided to the Monitor herein and in the

Orders and the Plan, shall be and is hereby authorized, directed and empowered to

perform its functions and fulfill its obligations under the Plan to facilitate the

implementation of the Plan.

21. THIS COURT ORDERS that the Monitor has satisfied all of its obligations up to and

including the date of this Plan Sanction Order, and that: (i) in carrying out the terms of

this Plan Sanction Order and the Plan including the obligations, duties and

responsibilities (if any) described in this Plan Sanction Order, the Monitor shall have all

the protections given to it by the CCAA, the Orders, and as an officer of the Court,

including the stay of proceedings in its favour; (ii) the Monitor shall incur no liability or

obligation as a result of carrying out the provisions of this Plan Sanction Order and/or the

Plan and in performing its duties as Monitor in these CCAA proceedings including the

obligations, duties and responsibilities (if any) described in this Plan Sanction Order, save

and except for any gross negligence or wilful misconduct on its part; (iii) the Monitor

shall be entitled to rely on the books and records of GuestLogix and any information

provided by GuestLogix without independent investigation; (iv) the Monitor shall not be

liable for any claims or damages resulting from any errors or omissions in such books,

- 8 -

records or information, or with respect to any such information disclosed to or provided

by the Monitor, including with respect to reliance thereon by any Person; and (v) the

distributions delivered by the Monitor pursuant to the Plan are not delivered by the

Monitor in its personal or corporate capacity and are delivered without personal or

corporate liability of the Monitor, and, without limiting the foregoing, the Monitor shall

have no obligations or liability in connection with any withholdings or deductions that

any Person may assert should or should not have been made in connection with such

distributions.

22. THIS COURT ORDERS that upon the delivery of the Monitor's Certificate by the

Monitor pursuant to paragraph 13 of this Plan Sanction Order, the Monitor shall be

discharged and released from its duties in respect of GuestLogix other than those

obligations, duties and responsibilities: (i) necessary or required to give effect to the

terms of the Plan and this Plan Sanction Order, (ii) in relation to the claims procedure and

all matters relating thereto as set out in the Claims Procedure Order, and (iii) in

connection with the completion by the Monitor of all other matters for which it is

responsible in connection with the Plan or pursuant to the Orders of this Court made in

these CCAA proceedings.

BOARD OF DIRECTORS OF GUESTLOGIX

23. THIS COURT ORDERS AND DECLARES that those persons listed on a certificate to

be filed with the Court by GuestLogix on or prior to the Plan Implementation Date shall

be deemed to be appointed as the board of directors of GuestLogix on the Plan

Implementation Date, provided that such certificate and the Persons listed thereon shall

be subject to the prior written consent of the Sponsor. Concurrently with the appointment

of such directors, all directors serving immediately prior to the Plan Implementation Date

shall be deemed to resign ( unless they are re-appointed in accordance with this

paragraph).

- 9 -

EFFECT, RECOGNITION AND ASSISTANCE

24. THIS COURT ORDERS that GuestLogix and the Monitor may apply to this Court for

advice and direction with respect to any matter arising from or under the Plan or this Plan

Sanction Order.

25. THIS COURT ORDERS that this Plan Sanction Order shall have full force and effect in

all provinces and territories of Canada and abroad as against all Persons and parties

against whom it may otherwise be enforced.

26. THIS COURT REQUESTS the aid and recognition of any court, tribunal, regulatory or

administrative body having jurisdiction in Canada, the United States, or in any other

foreign jurisdiction, to give effect to this Plan Sanction Order and the Plan or to assist

GuestLogix, the Monitor and their respective agents in carrying out the terms of this Plan

Sanction Order and the Plan. All courts, tribunals, regulatory and administrative bodies

are hereby respectfully requested to make such orders and to provide such assistance to

GuestLogix and to the Monitor, as an officer of this Court, as may be necessary or

desirable to give effect to this Plan Sanction Order and the Plan, to grant representative

status to the Monitor in any foreign proceeding, or to assist GuestLogix or the Monitor

and their respective agents in carrying out the terms of this Plan Sanction Order and the

Plan.

- 10 -

GENERAL

27. THIS COURT ORDERS that this Plan Sanction Order shall be posted on the Monitor's

Website at http://www.pwc.com/ca/en/services/insolvency-assignments/guestlogix.html

and is only required to be served upon the parties on the Service List and those parties

who appeared at the hearing of the motion for this Plan Sanction Order.

Schedule "A"

(Plan of Compromise and Arrangement)

Schedule "B"

Monitor's Certificate of Plan Implementation



(COMMERCIAL LIST)


AND IN THE MATTER OF A PROPOSED PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC. AND

GUESTLOGIX IRELAND LIMITED

CERTIFICATE OF PRICEWATERHOUSECOOPERS INC. AS THE COURT-APPOINTED MONITOR OF GUESTLOGIX INC. AND

GUESTLOGIX IRELAND LIMITED

(Plan Implementation)

All capitalized terms not otherwise defined herein shall have the meanings ascribed

thereto in the Plan of Compromise and Arrangement concerning, affecting and involving

GuestLogix Inc. ("GuestLogix") dated July 29, 2016 (the "Plan"), which is attached as Schedule

"A" to the Plan Sanction Order of the Honourable Regional Senior Justice Morawetz made in

these proceedings on September 12, 2016 (the "Plan Sanction Order"), as the Plan may be

further amended, varied or supplemented from time to time in accordance with its terms.

Pursuant to Article 8.4 of the Plan and paragraph 14 of the Plan Sanction Order,

PricewaterhouseCoopers Inc., in its capacity as the Court-appointed monitor of GuestLogix (the

"Monitor"), delivers this certificate to counsel to GuestLogix ( on behalf of GuestLogix) and to

counsel to the Sponsor and hereby certifies, in reliance upon the written confirmation from the

Company Advisors and the Sponsor Advisor and without independent investigation, that:

- 2 -

1. The Monitor has received written confirmation from the Company Advisors and

the Sponsor Advisors that the conditions precedent set out in Article 8 of the Plan have been

satisfied or waived, as applicable.

2. The Plan Implementation Date has occurred.

3. The Plan is effective in accordance with its terms and the terms of the Plan

Sanction Order.

DATED at the City of Toronto, in the Province of Ontario, this ___ day of September, 2016.

PRICEWATERHOUSECOOPERS INC., in its capacity as Court-appointed Monitor of GuestLogix Inc.

By:

Name:

Title:





(COMMERCIAL LIST)


PLAN SANCTION ORDER (Returnable September 12, 2016)



Rebecca L. Kennedy (LSUC# 61146S) Tel: (416) 304-0603 Fax: (416) 304-1313 Email: [email protected]



ONTARIO

SUPERIOR COURT OF JUSTICE

(COMMERCIAL LIST)

THE HONOURABLE REGIONAL SENIOR ) MONDAY, THE 12TH

DAY OF SEPTEMBER, 2016 JUSTICE MORA WETZ )

)


AND IN THE MATTER OF A PROPOSED PLAN OF COMPROMISE OR ARRANGEMENT OF GUESTLOGIX INC.

AND GUESTLOGIX IRELAND LIMITED

DECLARATION OF EQUITY CLAIMS ORDERS

THIS MOTION made by GuestLogix Inc. ("GuestLogix") for an Order declaring, inter

alia,

(a) the claims as asserted in the Proofs of Claims attached to the Affidavit of John

Gillberry as Exhibits "B", "C", "D" and "E" (the "Class Action Claims") are equity

claims under the CCAA; and

(b) the indemnity claim asserted in the Proof of Claim filed by Patrick Leung as attached

as Exhibit "N" to the Affidavit of John Gillberry (the "Indemnity Claim") is an

equity claim under the CCAA,

was heard on September 12, 2016 at 330 University Avenue, Toronto, Ontario.

ON READING the Notice of Motion, the Affidavit of John Gillberry sworn September

7, 2016, filed, the ninth report (the "Ninth Report") of PricewaterhouseCoopers Inc., in its

capacity as monitor of GuestLogix (the "Monitor"), filed, and on hearing the submissions of

counsel for each of GuestLogix, the Monitor, the Sponsor, and such other counsel as were

present and wished to be heard, no one else appearing although duly served as appears from the

affidavit of service, filed.

-2-

1. THIS COURT ORDERS AND DECLARES that the Class Action Claims are equity

claims pursuant to subsection 2(1) of the CCAA.

2. THIS COURT ORDERS AND DECLARES that the Indemnity Claim is an equity

claim pursuant to subsection 2(1) of the CCAA.





(COMMERCIAL LIST)


PLAN SANCTION ORDER (Returnable September 12, 2016)


Robert I. Thornton (LSUC# 24266B) Tel: ( 416) 304-0560 Email: [email protected]

Rebecca L. Kennedy (LSUC# 61146S) Tel: (416) 304-0603 Fax: ( 416) 304-1313 Email: [email protected]






(COMMERCIAL LIST)


MOTION RECORD (Re: Plan Sanction and Equity Claims)

Returnable September 12, 2016




Mitch Grossen (LSUC# 69993I) Tel: (416) 304-7978 Fax: (416) 304-1313 Email: [email protected]


motion record (re: plan sanction and equity claims) (returnable

Documents