AGENCY AGREEMENT

Effective July 8, 2011

Gryphon Gold Corporation
611N Nevada Street
Carson City, Nevada
89703

Attention:
Mr. John L. Key
 
Chief Executive Officer

Re:
Issue and Sale of Units

Acumen Capital Finance Partners Limited (the "Lead Agent") and Roth Capital
Partners, LLC (the "U.S. Agent") (the Lead Agent and the U.S. Agent together
being, the "Agents" and individually the "Agent") understand that Gryphon Gold
Corporation (the "Corporation") proposes to issue and sell, by way of private
placement, 3,000 units of the Corporation ("Units") at a price of $1,000.00 Cdn
per Unit for aggregate gross proceeds of $3,000,000 Cdn, subject to the terms
and conditions as set out below (the "Offering").  Each Unit will be comprised
of 10% subordinated secured notes (a "Debenture"), each with a principal face
value of $1,000 Cdn, and 1,500 warrants ("Warrants") to acquire one Common Share
(as hereinafter defined) of the Corporation (a "Warrant Share") at a price of
$0.20 US for a period of 18 months from the Closing Date (as hereinafter
defined).  The Debentures and the Warrants comprising the Units offered hereby
are collectively referred to as the "Offered Securities".
 
Subject to the terms and conditions hereof, the Agents agree to act as, and the
Corporation agrees to appoint the Agents as the exclusive agents of the
Corporation to offer the Units for sale on the Closing Date in the Selling
Jurisdictions (as hereinafter defined) on a private placement basis at the price
of $1,000.00 Cdn per Unit and to use their commercially reasonable efforts to
secure subscriptions therefor.  The Corporation acknowledges and agrees that the
Agents may, but are not obligated to, purchase any of the Units as principal.
 
The Offered Securities comprising the Units may be issued and sold pursuant to
exemptions under Applicable Securities Laws (as hereinafter defined) in the
Selling Jurisdictions including to "accredited investors" pursuant to National
Instrument 45-106 - Prospectus and Registration Exemptions and to Accredited
Investors (as hereinafter defined) in accordance with the provisions
hereof.  The Agents will offer the Units for sale directly by the Corporation in
compliance with Rule 506 of Regulation D (as hereinafter defined) and/or Section
4(2) (as hereinafter defined).
 
In connection with the Offering, the Agents shall be entitled to retain as
sub-agents other registered securities dealers and may receive (for delivery to
the Corporation at the Closing Time) subscriptions for Units from other
registered securities dealers.  The fee payable to such sub-agents shall be for
the account of the Agents and shall not exceed the fee payable to the Agents
hereunder. The Agents shall, however, be under no obligation to engage any
sub-agent.

 
 

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In consideration for its services hereunder, including, but not limited to, the
ancillary service of acting as financial advisor to the Corporation in respect
of the issue of the Offered Securities and advising on the terms and conditions
of the Offering, the Agents shall be entitled to: (i) the fee provided for in
Subsection 9(a), which fee shall be payable from the proceeds of the Offering at
the Closing Time upon the sale of the Units; and (ii) be issued the Broker
Warrants provided for in Subsection 9(b), which Broker Warrants shall be
substantially in the form set out in Schedule A hereto.  For greater certainty,
the services provided by the Agents pursuant to this Agreement will not be
subject to the Goods and Services Tax provided for in the Excise Tax Act
(Canada) and taxable supplies will be incidental to the exempt financial
services provided.
 
The following are the further terms and conditions of this Agreement:
 
1.
Definitions

 
As used in this Agreement, including the paragraphs prior to this definitional
section and any amendments hereto, unless the context otherwise requires:
 
 
(a)
"Accredited Investor" means "accredited investor", as such term is defined in
Rule 501(a) of Regulation D;

 
 
(b)
"affiliate" has the meaning ascribed thereto in the BCBCA and, for the purposes
of Section 28 of this Agreement, shall have the meaning ascribed to it in Rule
405 under the U.S. Securities Act;

 
 
(c)
"Agents' counsel" means Blake, Cassels & Graydon LLP, or such other legal
counsel as the Agents, with the consent of the Corporation, may retain;

 
 
(d)
"Agreement" means this agreement and not any particular Article, Section or
Subsection or other portion except as may be specified, and words such as
"hereto", "herein" and "hereby" refer to this Agreement as the context requires;

 
 
(e)
"Applicable Securities Laws" includes, without limitation, all applicable
securities and corporate laws, rules, regulations, instruments, notices, blanket
orders, decision documents, statements, circulars, procedures and policies in
the Selling Jurisdictions including, without limitation, the policies and
by-laws of the Exchange;

 
 
(f)
"BCBCA" means the Business Corporations Act (British Columbia), as amended,
including the regulations promulgated thereunder;

 
 
(g)
"Broker Shares" means the Common Shares issuable to the Agents upon the due
exercise of the Broker Warrants;

 
 
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(h)
"Broker Warrant Certificate(s)" means the certificate(s) representing the Broker
Warrants held by the Agents, which certificate(s) shall govern the terms and
conditions of the Broker Warrants and shall be substantially in the form
attached as Schedule A hereto;

 
 
(i)
"Broker Warrants" means the compensation warrants to be issued to the Agents as
provided for in Subsection 9(b), each Broker Warrant entitling the holder
thereof to acquire one Broker Share at a price of $0.20 US per Broker Share at
any time prior to the date which is 18 months from the Closing Date, all
pursuant to the Broker Warrant Certificates;

 
 
(j)
"business day" means a day which is not Saturday, Sunday or a legal holiday in
Calgary, Alberta;

 
 
(k)
"Closing Date" means July 26, 2011, or such other date or dates as the Agents
and the Corporation may agree in writing;

 
 
(l)
"Closing Time" means 10:00 a.m. (Calgary time), or such other time on the
Closing Date as the Agents and the Corporation may agree;

 
 
(m)
"Common Shares" means the shares of common stock in the capital of the
Corporation and, where appropriate in the context, includes the Warrant Shares
and the Broker Shares;

 
 
(n)
"Corporation" means Gryphon Gold Corporation, a corporation duly formed pursuant
to the laws of the state of Nevada and, when the context requires or permits,
includes its Subsidiary;

 
 
(o)
"Corporation's Canadian counsel" means Borden Ladner Gervais LLP, or such other
legal counsel as the Corporation, with the consent of the Agents, may appoint;

 
 
(p)
"Corporation's US counsel" means Dorsey & Whitney LLP, or such other legal
counsel as the Corporation, with the consent of the Agents may appoint;

 
 
(q)
"Debenture Certificates" means the certificates representing the Debentures
which certificates shall be governed by the terms and conditions set forth in
the Trust Indenture and shall be in form and substance satisfactory to the
Corporation and the Agents, acting reasonably.

 
 
(r)
"Documents" means, collectively:

 
 
(i)
The Annual Report on Form 10-K (including all Exhibits) of the Corporation for
the year ended March 31, 2011 filed with the United States Securities and
Exchange Commission on June 30, 2011;

 
 
(ii)
the Financial Statements;

 
 
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(iii)
the Technical Report;

 
 
(iv)
the Current Reports on Form 8-K (including all Exhibits) of the Corporation
filed with the United States Securities and Exchange Commission since March 31,
2011;

 
 
(v)
the material change reports of the Corporation subsequent to March 31, 2011;

 
 
(vi)
the press releases of the Corporation subsequent to March 31, 2011; and

 
 
(vii)
the management proxy statement and information circular of the Corporation dated
July 6, 2010 relating to the annual meeting of shareholders on August 20, 2010;

 
 
(s)
"Due Diligence Session" has the meaning ascribed thereto in Section 2(f) hereof;

 
 
(t)
"Due Diligence Session Responses" means the responses provided by the
Corporation, as given by any director or senior officer of the Corporation, at a
Due Diligence Session, excluding the portion of such responses which are
forward-looking or relate to projections or forecasts but including the portion
of such responses which relate to the properties and resources of the
Corporation;

 
 
(u)
"Exchange" means the Toronto Stock  Exchange or any successor thereto;

 
 
(v)
"Expert" means John D. Walsh, P.E.;

 
 
(w)
"Expiry Date" means the date that is 18 months from the Closing Date;

 
 
(x)
"Expiry Time" means 5:00 p.m. (Vancouver time) on the Expiry Date;

 
 
(y)
"Financial Statements" means, collectively, the audited consolidated financial
statements of the Corporation as at and for the years ended March 31, 2011 and
2010, together with the report of the Corporation's auditors thereon and the
notes thereto including, in each instance, management's discussion and analysis
of the Corporation's financial condition and results of operations related
thereto;

 
 
(z)
"General Solicitation" and "General Advertising" mean "general solicitation" and
"general advertising", respectively, as used in Rule 502(c) under the U.S.
Securities Act, including, but not limited to, advertisements, articles, notices
or other communications published in any newspaper, magazine or similar media or
broadcast over radio or television, disseminated over the Internet, or any
seminar or meeting whose attendees had been invited by general solicitation or
general advertising;

 
 
(aa)
"Lead Agent" means Acumen Capital Finance Partners Limited;

 
 
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(bb)
"NI 43-101" means National Instrument 43-101 - Standards of Disclosure for
Mineral Projects;

 
 
(cc)
"Pledge and Security Agreement" means the pledge and security agreement to be
dated as of the Closing Date by and among the Corporation and the Trustee, as
trustee to the Purchasers, substantially in form attached as Exhibit D to the
Purchase Agreement;

 
 
(dd)
"Public Record" means all information filed by or on behalf of the Corporation
with the Securities Commissions, including, without limitation, the Documents
and any other information filed with any Securities Commission in compliance, or
intended compliance, with any Applicable Securities Laws;

 
 
(ee)
"Purchase Agreements" means the debenture and warrant purchase agreements,
including the Schedules thereto, to be entered into at closing between the
Corporation and each of the Purchasers setting out the contractual relationship
between the Corporation and the Purchasers, in form and substance satisfactory
to the Corporation and the Agents;

 
 
(ff)
"Purchaser" means a person resident in the Selling Jurisdictions who subscribes
for Units;

 
 
(gg)
"Regulation D" means Regulation D adopted by the SEC under the U.S. Securities
Act;

 
 
(hh)
"SEC" means the United States Securities and Exchange Commission;

 
 
(ii)
"Section 4(2)" means Section 4(2) of the U.S. Securities Act;

 
 
(jj)
"Securities Commissions" means, collectively, the securities commissions or
similar regulatory authorities in each of the Selling Jurisdictions and
"Securities Commission" means any of them;

 
 
(kk)
"SEDAR" means the system for electronic document analysis and retrieval;

 
 
(ll)
"Selling Dealer Group" means the dealers and brokers, other than the Agents, who
participate in the offer and sale of the Offered Securities pursuant to this
Agreement;

 
 
(mm)
"Selling Jurisdictions" means the provinces of British Columbia, Alberta,
Saskatchewan, and Ontario and the United States and other eligible foreign
jurisdictions as may be agreed by the Agents and the Corporation prior to the
Closing Date as evidenced by the Corporation's acceptance of a Purchase
Agreement with respect thereto;

 
 
(nn)
"Subsidiary" means Borealis Mining Company;

 
 
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(oo)
"Swaps" means any transaction which is a rate swap transaction, basis swap,
forward rate transaction, commodity swap, commodity option, equity or equity
index swap, equity or equity index option, bond option, interest rate option,
foreign exchange transaction, cap transaction, floor transaction, collar
transaction, currency swap transaction, cross-currency rate swap transaction,
currency option, forward sale, exchange traded futures contract or any other
similar transaction (including any option with respect to any of these
transactions or any combination of these transactions);

 
 
(pp)
"Technical Report" means the report dated April 25, 2011 prepared by the Expert
entitled "NI 43-101 Pre-Feasibility Study Update of the Mineral Resources of the
Borealis Gold Project located in Mineral county, Nevada, USA", as filed on
SEDAR;

 
 
(qq)
"Transaction Documents" means the Trust Indenture, the Pledge and Security
Agreement, the Warrant Certificates, the Broker Warrant Certificates and the
Purchase Agreements;

 
 
(rr)
"Trust Indenture" means the Note Indenture to be dated as of the Closing Date
between the Corporation and the Trustee substantially in the form attached as
Exhibit B to the Purchase Agreement;

 
 
(ss)
"Trustee" means Computershare Trust Company of Canada;

 
 
(tt)
"United States" means the United States of America, its territories and
possessions, any State of the United States, and the District of Columbia;

 
 
(uu)
"U.S. Agent" means Roth Capital Partners, LLC;

 
 
(vv)
"U.S. Exchange Act" means the United States Securities Exchange Act of 1934, as
amended;

 
 
(ww)
"U.S. Securities Act" means the United States Securities Act of 1933, as
amended;

 
 
(xx)
"Warrant Certificates" means the certificates representing the Warrants held by
Purchasers of Units, which certificates shall govern the terms and conditions of
the Warrants and shall be substantially in the form attached as Exhibit C to the
Purchase Agreement;

 
 
(yy)
"Warrant Shares" means the Common Shares issuable to the holders of Warrants
upon the due and proper exercise of the Warrants in accordance with their terms;
and

 
"misrepresentation", "material change" and "material fact" shall have the
meanings ascribed thereto under the Applicable Securities Laws of the Selling
Jurisdictions; "distribution" means "distribution" or "distribution to the
public", as the case may be, as defined under the Applicable Securities Laws of
the Selling Jurisdictions; and "distribute" has a corresponding meaning. In this
Agreement, words importing the singular include the plural and words importing
gender include all genders.

 
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2.
Corporation's Covenants as to Issuance

 
The Corporation agrees:
 
 
(a)
that the Offered Securities will be duly and validly created, authorized and,
upon receipt of full payment therefore shall be legal, valid and binding
obligations of the Corporation enforceable against the Corporation in accordance
with their terms, subject to applicable bankruptcy, insolvency or similar laws
and general equitable principles;

 
 
(b)
to comply with all covenants of the Corporation set forth in this Agreement and
the Transaction Documents and to duly, punctually and faithfully perform all the
obligations to be performed by it under this Agreement and the Transaction
Documents;

 
 
(c)
to deliver to the Agents as many copies of the Documents as the Agents may
reasonably request and such delivery shall constitute the Corporation's
authorization for the Agents to use the Documents in connection with the
Offering of the Offered Securities for sale in the Selling Jurisdictions;

 
 
(d)
to file all necessary forms and reports with the appropriate Securities
Commissions and other regulatory authorities in connection with the issuance of
the Offered Securities and the Broker Warrants;

 
 
(e)
as soon as reasonably possible, and in any event by the Closing Date, to take
all such steps as may reasonably be necessary to enable the Units, including the
Offered Securities, to be offered for sale and sold on a private placement basis
in the Selling Jurisdictions through the Agents or any other investment dealers
or brokers registered in the Selling Jurisdictions by way of the exemptions
under Applicable Securities Laws as contemplated hereby; and

 
 
(f)
prior to the Closing Date and during the period from the effective date hereof
until the completion of the distribution of the Units, to allow the Agents to
conduct all due diligence which the Agents may reasonably require in order to:
(i) confirm the Public Record is accurate, current and complete in all material
respects; and (ii) fulfill the Agents' obligations as agents, and will provide
to the Agents and their counsel and consultants reasonable access to the
Corporation's properties, senior management personnel and corporate, financial
and other records for the purposes of conducting such due diligence reviews.
Without limiting the generality of the foregoing, the Corporation shall make
available its directors, senior management, auditors, legal counsel and
independent engineers to answer any reasonable questions which the Agents may
have and to participate in one or more due diligence sessions to be held prior
to the Closing Time (collectively, the "Due Diligence Session").  The Agents
shall distribute a list of written questions to be answered in advance of such
Due Diligence Session and the Corporation shall provide oral responses to such
questions and shall use its commercially reasonable efforts to have its
auditors, legal counsel and independent engineers provide oral responses to such
questions in advance of the Due Diligence Session.

 
 
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3.
Corporation's Covenants as to Changes

 
The Corporation agrees that:
 
 
(a)
during the period commencing with the date hereof and ending at the Closing
Time, the Corporation will promptly inform the Agents of the full particulars
of:

 
 
(i)
any material change (actual, anticipated or threatened) in the assets,
liabilities (absolute, accrued, contingent or otherwise), business, operations,
capital or condition (financial or otherwise) of the Corporation and its
Subsidiary (taken as a whole), including but not limited to any legal or
regulatory changes that may reasonably affect the assets, liabilities (absolute,
accrued, contingent or otherwise), business, operations, capital or condition
(financial or otherwise) of the Corporation or the Subsidiary; or

 
 
(ii)
any change in any material fact contained or referred to in the Public Record;

 
 
(iii)
the occurrence or discovery of, or change in, a material fact or event which, in
any such case, is, or may be, of such a nature as to: (A) render any statement
in the Public Record untrue, false or misleading in a material respect in light
of the circumstances in which it was made; (B) result in a misrepresentation in
any part of the Public Record; or (C) result in any part of the Public Record
not complying with Applicable Securities Laws; or

 
 
(iv)
the discovery by the Corporation of any misrepresentation in any part of the
Public Record or in any information regarding the Corporation previously
provided to the Agents by the Corporation;

 
provided that if the Corporation is uncertain as to whether a material change of
the nature referred to in this subsection has occurred, the Corporation shall
promptly inform the Agents of the full particulars of the material change giving
rise to the uncertainty and shall consult with the Agents to determine whether a
material change has occurred;
 
 
(b)
during the period commencing with the date hereof and ending on the Closing
Date, the Corporation will promptly inform the Agents of the full particulars
of:

 
 
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(i)
any request of any Securities Commission or other securities commission or
similar regulatory authority for any amendment to any part of the Public Record
or for any additional information which may be material to the distribution of
the Offered Securities, the Warrant Shares, the Broker Warrants or the Broker
Shares;

 
 
(ii)
the issuance by any Securities Commission or other securities commission or
similar regulatory authority, the Exchange or by any other competent authority
of any order to cease or suspend trading of any securities of the Corporation or
of the institution or threat of institution of any proceedings for that purpose;
or

 
 
(iii)
the receipt by the Corporation of any communication from any Securities
Commission or other securities commission or similar regulatory authority, the
Exchange or any other competent authority relating to any part of the Public
Record or the distribution of the Offered Securities, the Warrant Shares, or the
Broker Warrants or the Broker Shares;

 
and except as otherwise agreed by the Agents, acting reasonably, the Corporation
will use its reasonable best efforts to prevent the issuance of any such cease
trading order or suspension order and, if issued, to obtain the withdrawal
thereof as soon as possible;

 
(c)
during the period commencing on the date hereof and ending on the date which is
30 days after the Closing Date, the Corporation will promptly provide to the
Agents, for review by the Agents and the Agents' counsel, prior to the
publication, filing or issuance thereof, any press release (subject to the
Corporation's obligations under Applicable Securities Laws to make timely
disclosure of material information); and

 
 
(d)
the Corporation shall promptly comply, to the reasonable satisfaction of the
Agents and the Agents' counsel, with all applicable filing and other
requirements under Applicable Securities Laws with respect to any material
change, change, occurrence or event of the nature referred to or contemplated in
Section 3(a) or Section 3(b) and shall provide an opportunity for the prior
review and approval thereof by the Agents, acting reasonably, prior to the
filing of any such amendment.

 
4.
Corporation's Other Covenants

 
The Corporation agrees that:
 
 
(a)
the Corporation shall not take any action that would prevent the Corporation and
the Agents from relying on the exemptions from the prospectus and registration
requirements of Applicable Securities Laws as contemplated by the Purchase
Agreements;

 
 
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(b)
the Corporation will use the proceeds from the issuance and sale of the Units to
fund the purchase of an Absorption, Desorption and Recovery Plant for, and
installation of electrical power to, the Corporation's Borealis project located
in the Walker Lane gold belt of Western Nevada and for general working capital
purposes;

 
 
(c)
the Corporation will allow the Agents and the Agents' counsel, acting
reasonably, to participate fully in the preparation of the Transaction
Documents;

 
 
(d)
the Corporation will make available at reasonable times and places its senior
management persons to meet with potential investors if so requested by the
Agents;

 
 
(e)
the Corporation will use its commercially reasonable efforts to obtain all
necessary approvals of the Exchange for the issuance of and the listing and
posting of the Warrant Shares and the Broker Shares for trading on the Exchange,
subject only to the filing of required documents and payment of applicable fees
which cannot reasonably be filed until after the Closing Time;

 
 
(f)
the Corporation shall use its commercially reasonable efforts to maintain its
(or any successors') status as a reporting issuer not in default of any
Applicable Securities Laws in the Selling Jurisdictions in Canada in which it is
a reporting issuer until 180 days after the Closing Date in the Selling
Jurisdictions in which it is or in which it becomes a reporting issuer;

 
 
(g)
the Corporation will carry on its business in a prudent manner in accordance
with industry standards and good business practice and will keep or cause to be
kept proper books of accounts in accordance with applicable law;

 
 
(h)
the Corporation will not, from the date hereof until that date that is 120 days
following the Closing Date, directly or indirectly, sell, or offer to sell, or
announce the offering of, or enter into or make any agreement or understanding,
or announce the making or entry into of any agreement or understanding, to
issue, sell or exchange any preferred shares, common shares or securities
exchangeable or convertible into common shares without the prior written consent
of the Agents, not to be unreasonably withheld, provided that notwithstanding
the foregoing the Corporation may: (i) grant stock options under the
Corporation's existing employee stock option plan (not in excess of the number
of options allowable under the rules of the Exchange); and (ii) issue Common
Shares to the holders thereof or to the holders of other stock options, warrants
or other convertible securities or instruments of the Corporation existing at
the date hereof; and;

 
 
(i)
the Corporation will file all necessary forms and reports in connection with the
issuance of the Offered Securities, the Warrant Shares, the Broker Warrants and
the Broker Warrant Shares with the appropriate Securities Commissions and other
regulatory authorities.

 
 
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5.
Agents' Covenants

 
Each of the Agents covenants and agrees with the Corporation that it will:
 
 
(a)
conduct its activities in connection with the proposed offer and sale of the
Units in compliance with this Agreement and all Applicable Securities Laws and
cause each member of the Selling Dealer Group established in connection with the
distribution of the Offered Securities to acknowledge its agreement to be bound
by the provisions of this Agreement;

 
 
(b)
comply with the applicable United States offering restrictions imposed by the
laws of the United States and comply with the offering procedures set forth in
Section 29 hereof;

 
 
(c)
not solicit subscriptions for Offered Securities, trade in Units or otherwise do
any act in furtherance of a trade of Offered Securities outside of the Selling
Jurisdictions except in any other jurisdiction in compliance with the applicable
laws thereof, and provided that the Agents may so solicit, trade or act within
such jurisdiction only with the express written consent of the Corporation and
if such solicitation, trade or act is in compliance with applicable securities
laws in such jurisdiction and does not: (i) obligate the Corporation to take any
action to qualify or register any of its securities or any trade of any of its
securities (including the distribution of the Offered Securities) in such
jurisdiction; (ii) obligate the Corporation to establish or maintain any office
or director or officer in such jurisdiction; or (iii) subject the Corporation to
any reporting or other requirement in such jurisdiction;

 
 
(d)
obtain from each Purchaser an executed Purchase Agreement and all applicable
undertakings, questionnaires and other forms required under Applicable
Securities Laws or requirements of the Exchange and supplied to the Agents by
the Corporation for completion in connection with the distribution of the
Offered Securities; and

 
 
(e)
not advertise the proposed offering or sale of the Units in printed media of
general and regular paid circulation, radio, television or telecommunications,
including electronic display, nor provide or make available to prospective
purchasers of Units any document or material which would constitute or require
the Corporation to prepare an offering memorandum, registration statement or
prospectus as defined under Applicable Securities Laws.

 
6.
Representations and Warranties of the Corporation

 
The Corporation represents and warrants to the Agents and the Purchasers, and
acknowledges that the Agents and the Purchasers are relying upon such
representations and warranties, as follows:

 
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(a)
Due Incorporation. The Corporation has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Nevada, with full corporate power and authority to own, lease and operate its
properties and conduct its business, to execute and deliver this Agreement and
to issue, sell and deliver the Offered Securities as contemplated herein.

 
 
(b)
Foreign Qualifications. The Corporation is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction where the
ownership or leasing of its properties or the conduct of its business requires
such qualification, except where the failure to be so qualified and in good
standing would not, individually or in the aggregate, be reasonably expected to
(i) have a material adverse effect on the business, prospects, properties,
management, financial condition or results of operations of the Corporation and
the Subsidiary, taken as a whole, or (ii) prevent or interfere with consummation
of the transactions contemplated hereunder or in connection herewith or (the
occurrence of any such effect or any such prevention or interference or any such
result described in the foregoing clauses (i) and (ii) being herein referred to
as a "Material Adverse Effect").

 
 
(c)
Subsidiaries. The Corporation does not have any subsidiaries other than the
Subsidiary; all of the issued and outstanding shares of common stock or other
voting stock of the Subsidiary are owned or held directly by the Corporation,
are registered in the Corporation's name and are validly issued as fully paid
and non-assessable, and the Corporation holds all such shares of common stock
with valid and marketable title thereto free and clear of any liens, pledges,
charges, encumbrances, security interests or other adverse claims whatsoever
(other than pursuant to the Trust Indenture or Pledge and Security Agreement),
the Corporation is not "affiliated" with or a "holding corporation" of any other
body corporate (within the meaning of those terms in the BCBCA), nor is it a
partner of any partnerships (other than participating in industry partnerships
in the ordinary course of business) or limited partnerships, and the Corporation
has no material shareholdings in any other corporation or business organization.

 
 
(d)
Public Record.  The information and statements set forth in the Public Record
were true, correct, and complete and did not contain any misrepresentations, as
of the date of such information or statement, and were prepared in accordance
with and complied with Applicable Securities Laws and the Corporation has not
filed any confidential material change reports still maintained on a
confidential basis.

 
 
(e)
Description of Capital Stock.  The authorized capital of the Corporation
consists of 250,000,000 Common Shares and 15,000,000 shares of preferred stock,
of which [•] Common Shares and nil shares of preferred stock are currently
issued and outstanding, each of which shares is validly issued as full paid and
non assessable.

 

 
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(f)
Authorization, Issuance. The Corporation has the corporate power and authority
to enter into this Agreement and to authorize, issue and sell the Offered
Securities as contemplated by this Agreement. All corporate action required to
be taken by the Corporation for the authorization, issuance and sale of the
Offered Securities has been duly and validly taken. The Offered Securities have
been duly and validly authorized. When the Offered Securities have been issued
and delivered against payment therefor as provided herein, the Offered
Securities, when so issued and sold, will be legal, valid and binding
obligations of the Corporation, enforceable against the Corporation in
accordance with their terms, subject to applicable bankruptcy, insolvency or
similar laws and general equitable principles and free of all statutory and
contractual preemptive rights, resale rights, rights of first refusal and
similar rights and will be free of any restriction upon the voting or transfer
thereof pursuant to Applicable Securities Laws or the Corporation's charter or
by-laws or any agreement or other instrument to which the Corporation is a
party.

 
 
(g)
Due Authorization. This Agreement has been duly authorized, executed and
delivered by the Corporation and constitutes a valid, legal and binding
obligation of the Corporation, enforceable against the Corporation in accordance
with its terms, except as rights to indemnity hereunder may be limited by
Applicable Securities Laws and except (i) as such enforceability may be limited
by applicable bankruptcy, insolvency, reorganization or similar laws of general
applicability affecting the rights of creditors generally, (ii) as
enforceability of any indemnification or contribution provision may be limited
under the federal and state securities laws in the United States or by federal
and provincial laws in Canada, and (iii) that the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to the
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.

 
 
(h)
No Violation. Neither the Corporation nor the Subsidiary is in breach or
violation of or in default under (nor has any event occurred which would
constitute any event which, with notice, lapse of time or both, would result in
any breach or violation of or constitute a default under or give rise to any
right of termination, cancellation or acceleration under) (A) its articles of
incorporation or by-laws, or (B) any indenture, mortgage, deed of trust, bank
loan or credit agreement or other evidence of indebtedness, or any license,
lease, contract or other agreement or instrument to which it is a party or by
which it or any of its properties may be bound or affected, or (C) any federal,
state, provincial, local or foreign law, regulation or rule, or (D) any rule or
regulation of any self-regulatory organization or other non-governmental
regulatory authority (including, without limitation, any applicable rules and
regulations of the OTC Bulletin Board (the "OTCBB") or the Exchange), or (E) any
decree, judgment or order applicable to it or any of its properties; except, in
the cases of clause (B), (C), (D) and (E), where such occurrence would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect.

 
 
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(i)
No Conflict. The execution, delivery and performance of this Agreement, the
issuance and sale of the Offered Securities and the consummation of the
transactions contemplated hereby will not conflict with, result in any breach or
violation of or constitute a default under (nor constitute any event which, with
notice, lapse of time or both, would result in any breach or violation of or
constitute a default under or give rise to any right of termination,
cancellation or acceleration under) (or result in the creation or imposition of
a lien, charge or encumbrance on any property or assets of the Corporation or
the Subsidiary pursuant to) (A) the articles of incorporation or by-laws of the
Corporation or the Subsidiary, or (B) any indenture, mortgage, deed of trust,
bank loan or credit agreement or other evidence of indebtedness, or any license,
lease, contract or other agreement or instrument to which the Corporation or the
Subsidiary is a party or by which any of them or any of their respective
properties may be bound or affected, or (C) any federal, state, provincial,
local or foreign law, regulation or rule, or (D) any rule or regulation of any
self-regulatory organization or other non-governmental regulatory authority
(including, without limitation, any applicable rules and regulations of the
OTCBB or the Exchange), or (E) any decree, judgment or order applicable to the
Corporation or the Subsidiary or any of their respective properties; except, in
the cases of clause (B), (C), (D) and (E), where such occurrence would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect.

 
 
(j)
No Consents Required. No approval, authorization, consent or order of or filing
with any federal, state, provincial, local or foreign governmental or regulatory
commission, board, body, authority or agency, or of or with any self-regulatory
organization or other non-governmental regulatory authority, or approval of the
shareholders of the Corporation, is required in connection with the issuance and
sale of the Offered Securities or the consummation by the Corporation of the
transactions contemplated hereby, other than any necessary approvals under the
listing requirements of the Exchange.

 
 
(k)
No Rights. (i) No person has the right, contractual or otherwise, to cause the
Corporation to issue or sell to such person any Common Shares or shares of any
other capital stock or other equity interests of the Corporation, (ii) no person
has any preemptive rights, resale rights, rights of first refusal or other
rights to purchase any Common Shares or shares of any other capital stock of or
other equity interests in the Corporation, (iii) no person has the right to act
as an agent or as a financial advisor to the Corporation in connection with the
offer and sale of the Offered Securities, and (iv) no person has the right,
contractual or otherwise, to cause the Corporation to register under the U.S.
Securities Act any Common Shares or shares of any other capital stock of, or
other equity interests or securities in, the Corporation, other than the
registration rights of the purchasers in the Corporation's private placement of
units of the Corporation which closed in January, 2011.

 
 
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(l)
Permits. Each of the Corporation and the Subsidiary has all necessary licenses,
authorizations, consents and approvals and has made all necessary filings
required under any applicable law, regulation or rule, and has obtained all
necessary licenses, authorizations, consents and approvals from other persons,
in order to conduct their respective businesses, except where the failure to
have or obtain such licenses, authorizations, consents and approvals would not,
individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect; neither the Corporation nor the Subsidiary is in violation of,
or in default under, or has received notice of any proceedings relating to
revocation or modification of, any such license, authorization, consent or
approval or any federal, state, provincial, local or foreign law, regulation or
rule or any decree, order or judgment applicable to the Corporation or the
Subsidiary, except where such violation, default, revocation or modification
would not, individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect.

 
 
(m)
Mining Rights.

 
 
(i)
Either the Corporation or the Subsidiary holds Mining Rights (as defined below)
in respect of all of the Mineral Properties (defined below).  "Mining Rights"
means marketable title, freehold title, leases, mining concessions, mining
claims, licenses of occupation, participating interests or other conventional
property or proprietary interests or rights recognized in the jurisdiction in
which a particular property is located, in respect of the ore bodies and
minerals located therein under valid, subsisting and enforceable title
documents, or other recognized and enforceable agreements or instruments,
sufficient to permit the Corporation or the Subsidiary to explore for mineral
deposits relating thereto, free and clear of any liens, charges or
encumbrances.  "Mineral Properties" means the material mineral properties of the
Corporation as disclosed in the Documents, including, without limitation, the
"Borealis Property" located along the Aurora-Bodie trend in the State of Nevada.

 
 
(ii)
All material Mining Rights in which the Corporation or the Subsidiary holds an
interest or right have been validly registered and recorded in accordance with
all applicable laws and are valid and subsisting, and each of the Mining Rights
and each of the documents, agreements and instruments and obligations relating
thereto is currently in good standing in the name of the Corporation or the
Subsidiary.

 
 
(iii)
Neither the Corporation nor the Subsidiary has received any notice of the
revocation, adverse modification or cancellation of, or any intention to revoke,
adversely modify or cancel, any of the instruments conferring Mining Rights in
respect of the Mineral Properties.

 
 
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(iv)
The disclosure regarding the Mineral Properties and Mining Rights of the
Corporation and the Subsidiary in the Documents, accurately describes all
material facts regarding the Mineral Properties and all material Mining Rights
held by the Corporation and the Subsidiary, and no other material property or
assets are necessary for the conduct of the business of the Corporation and the
Subsidiary as currently conducted; except as disclosed in the Documents the
Corporation does not know of any claim or the basis for any claim that might or
could materially and adversely affect the Corporation’s right to use, transfer
or explore for mineral deposits on such Mineral Properties and, except as
disclosed in the Documents the Corporation and the Subsidiary hold interests in
such Mineral Properties free and clear of any material liens, charges or
encumbrances and no material commission, royalty, license fee or similar payment
to any person with respect to the Mineral Properties is payable.

 
 
(v)
All exploration activities on the Mineral Properties by the Corporation or its
Subsidiary have been conducted in all material respects in accordance with good
exploration practices and in compliance with all applicable laws, regulations
and policies in all material respects.

 
 
(n)
Technical Reports.

 
 
(i)
The Technical Report complies in all material respects with the requirements of
NI 43-101 at the time of filing thereof and each of the Technical Report
reasonably presents the quantity of mineral resources attributable to the
properties evaluated therein as of the date stated therein based upon
information available at the time the Technical Report was prepared; the
Corporation made available to the authors of the Technical Report, prior to the
issuance thereof and for the purpose of preparing such reports, all information
requested by them, which information did not contain any misrepresentation at
the time such information was so provided.

 
 
(ii)
All of the material assumptions underlying the reserve and resource estimates in
the Technical Report are, to the extent known to the Corporation, reasonable and
appropriate.

 
 
(iii)
Each of the authors and consultants of the Technical Report was, at the time of
the Technical Report, "independent" (as such term is defined in NI 43-101). To
the Corporation’s knowledge, each such author continues to qualify as being
"independent" (as such term is defined in NI 43-101).

 
 
(iv)
The Corporation is in compliance in all material respects with the provisions of
NI 43-101 and has filed all technical reports required thereby and there has
been no change to the Technical Report or the properties evaluated therein of
which the Corporation is aware that would require the filing of new technical
reports under NI 43-101.

 
 
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(o)
Legal Proceedings. There are no actions, suits, claims, investigations or
proceedings pending or, to the Corporation’s knowledge, threatened or
contemplated, to which the Corporation or the Subsidiary or any of their
respective directors or officers is or would be a party or of which any of their
respective properties is or would be subject at law or in equity, before or by
any federal, state, provincial, local or foreign governmental or regulatory
commission, board, body, authority or agency, or before or by any
self-regulatory organization or other non-governmental regulatory authority or
the OTCBB or the Exchange, except any such action, suit, claim, investigation or
proceeding which, if resolved adversely to the Corporation or the Subsidiary,
would not, individually or in the aggregate, be reasonably expected to have a
Material Adverse Effect.

 
 
(p)
Independent Accountants.  DeCoria Maichel & Teague, is an independent registered
public accountant with respect to the Corporation as required by the Applicable
Securities Laws, and by the rules of the Public Company Accounting Oversight
Board and, to the best of the Corporation's knowledge, is registered as such.

 
 
(q)
Financial Statements. The Financial Statements, together with the related notes
and schedules, present fairly in all material respects the consolidated
financial position of the Corporation and the Subsidiary as of the dates
indicated and the consolidated results of operations, cash flows and changes in
shareholders’ equity of the Corporation for the periods specified have been
prepared in compliance with the applicable requirements of the U.S. Securities
Act and the U.S. Exchange Act and in conformity with U.S. generally accepted
accounting principles ("GAAP") applied on a consistent basis during the periods
involved.

 
 
(r)
Absence of Material Changes.  Subsequent to the respective date of the Financial
Statements there has not been (i) any event or occurrence that, individually or
in the aggregate, has resulted in or may result in a Material Adverse Effect,
(ii) any obligation or liability, direct or contingent (including any
off-balance sheet obligations), incurred by the Corporation or the Subsidiary,
which, individually or in the aggregate, has resulted in or may result in a
Material Adverse Effect, (iii) any change in the capital stock of the
Corporation, except for the issuance of stock pursuant to the exercise of stock
options or warrants outstanding, or pursuant to the equity incentive plans of
the Corporation then in effect, or outstanding indebtedness of the Corporation
or the Subsidiary, or (iv) any dividend or distribution of any kind declared,
paid or made on the capital stock of the Corporation or the Subsidiary.

 
 
(s)
Not an Investment Company. Neither the Corporation nor the Subsidiary is, and,
after giving effect to the offering and sale of the Offered Securities and the
application of the proceeds thereof, none of them will be, an "investment
company" or an entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act").

 
 
(t)
Good Title to Property.  The Corporation and the Subsidiary have good and
marketable title to all of their respective properties, free and clear of all
liens, claims, security interests or other encumbrances, except as described in
the Documents such as would not individually or in the aggregate, be reasonably
expected to have a Material Adverse Effect; all of the properties held under
lease by the Corporation or the Subsidiary is held thereby under valid,
subsisting and enforceable leases except such as would not, individually or in
the aggregate, be reasonably expected to have a Material Adverse Effect.

 
 
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(u)
Material Contracts. Except such as would not, individually or in the aggregate,
be reasonably expected to have a Material Adverse Effect, each material
contract, agreement and license, to which the Corporation or its Subsidiary is
bound (all of which are set forth in Schedule E hereto), is legal, valid,
binding, enforceable and in full force and effect against the Corporation or the
Subsidiary, as applicable, and, to the knowledge of the Corporation, each other
party thereto, except to the extent such enforceability is subject to (i) laws
of general application relating to bankruptcy, insolvency, moratorium and the
relief of debtors and (ii) the availability of specific performance, injunctive
relief and other equitable remedies. Neither the Corporation nor its Subsidiary
nor, to the Corporation's knowledge, any other party, is in material breach or
default with respect to any such contract, agreement or license. To the
Corporation's knowledge, no event has occurred which with notice or lapse of
time would constitute a material breach or default, or permit termination,
modification, or acceleration, under any such contract, agreement or license. No
party has repudiated any material provision of any such contract, agreement or
license.

 
 
(v)
Intellectual Property. The Corporation and the Subsidiary own, or have obtained
valid and enforceable licenses for, or other rights to use, the inventions,
patent applications, patents, trademarks (both registered and unregistered),
trade names, service names, copyrights, trade secrets and other proprietary
information described in the Documents, as being owned or licensed by them or
which are necessary for the conduct of their respective businesses as currently
conducted or as proposed to be conducted except such as would not, individually
or in the aggregate, be reasonably expected to have a Material Adverse Effect
(collectively, "Intellectual Property"); to the Corporation's knowledge, there
are no third parties who have, or will be able to establish, rights to any
Intellectual Property, except for, and to the extent of, the ownership rights of
the owners of the Intellectual Property which is licensed to the Corporation and
the license rights of any third parties to which the Intellectual Property is
licensed; to the knowledge of the Corporation, there is no infringement by third
parties of any material Intellectual Property; there is no pending or, to the
Corporation's knowledge, threatened, action, suit, proceeding or claim by any
third party challenging the Corporation's rights in or to any material
Intellectual Property, and the Corporation is unaware of any facts which could
form a reasonable basis for any such action, suit, proceeding or claim; there is
no pending or, to the Corporation's knowledge, threatened, action, suit,
proceeding or claim by others challenging the validity, enforceability or scope
of any material Intellectual Property, and the Corporation is unaware of any
facts which could form a reasonable basis for any such action, suit, proceeding
or claim; there is no pending or, to the Corporation’s knowledge, threatened,
action, suit, proceeding or claim by others that the Corporation or the
Subsidiary infringes or otherwise violates, any patent, trademark, trade name,
service name, copyright, trade secret or other proprietary rights of others, and
the Corporation is unaware of any facts which could form a reasonable basis for
any such action, suit, proceeding or claim; the Corporation and the Subsidiary
have complied in all material respects with the terms of each agreement pursuant
to which any material Intellectual Property has been licensed to the Corporation
or the Subsidiary, and all such agreements are in full force and effect except
such as would not, individually or in the aggregate, be reasonably expected to
have a Material Adverse Effect; to the knowledge of the Corporation, there is no
patent or patent application that contains claims that interfere with the issued
or pending claims of any material Intellectual Property or that challenges the
validity, enforceability or scope of any material Intellectual Property; to the
knowledge of the Corporation, there is no prior art that may render any patent
application within the Intellectual Property unpatentable that has not been
disclosed to the U.S. Patent and Trademark Office.

 
 
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(w)
Labor Matters. Neither the Corporation nor the Subsidiary is engaged in any
unfair labor practice; except for matters which would not, individually or in
the aggregate, be reasonably expected to have a Material Adverse Effect, (i)
there is (A) no unfair labor practice complaint pending or, to the Corporation's
knowledge, threatened against the Corporation or the Subsidiary before the
National Labor Relations Board, and no grievance or arbitration proceeding
arising out of or under collective bargaining agreements is pending or, to the
Corporation’s knowledge, threatened, (B) no strike, labor dispute, slowdown or
stoppage pending or, to the Corporation’s knowledge, threatened against the
Corporation or the Subsidiary and (C) no union representation dispute currently
existing concerning the employees of the Corporation or the Subsidiary; (ii) to
the Corporation's knowledge, no union organizing activities are currently taking
place concerning the employees of the Corporation or the Subsidiary; and (iii)
there has been no violation of any federal, state, provincial, local or foreign
law relating to discrimination in the hiring, promotion or pay of employees, any
applicable wage or hour laws, any provision of the Worker Adjustment and
Retraining Notification Act of 1988, as amended ("WARN Act"), or the WARN Act’s
state, provincial, foreign or local equivalent, or any provision of the Employee
Retirement Income Security Act of 1974 ("ERISA"), or the rules and regulations
promulgated thereunder concerning the employees of the Corporation or the
Subsidiary; the Corporation and the Subsidiary are in compliance with all
presently applicable provisions of ERISA, except where such non-compliance would
not be reasonably expected to result in a Material Adverse Effect; no
"reportable event" (as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) to which the Corporation or the Subsidiary
contributes or which the Corporation or the Subsidiary maintains; the
Corporation and the Subsidiary has not incurred and does not expect to incur
liability under (x) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (y) Sections 412 or 4971 of the Internal
Revenue Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension plan" for which the
Corporation or the Subsidiary would have any liability that is intended to be
qualified under Section 401(a) of the Code is so qualified and nothing has
occurred, whether by action or by failure to act, which would cause the loss of
such qualification.

 
 
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(x)
Compliance with Environmental Laws. Except as disclosed in the Documents, the
Corporation and the Subsidiary and their respective properties, assets and
operations are in compliance with, and the Corporation and the Subsidiary hold
all permits, authorizations and approvals required under, Environmental Laws (as
defined below), except to the extent that failure to so comply or to hold such
permits, authorizations or approvals would not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect; there are
no past, present or, to the Corporation’s knowledge, reasonably anticipated
future, events, conditions, circumstances, activities, practices, actions,
omissions or plans that could reasonably be expected to give rise to any
material costs or liabilities to the Corporation or the Subsidiary under, or to
interfere with or prevent compliance by the Corporation or the Subsidiary with,
Environmental Laws; except as would not, individually or in the aggregate, be
reasonably expected to have a Material Adverse Effect or as disclosed in the
Documents, neither the Corporation nor the Subsidiary (i) is the subject of any
investigation, (ii) has received any notice or claim, (iii) is a party to or
affected by any pending or, to the Corporation’s knowledge, threatened, action,
suit or proceeding, (iv) is bound by any judgment, decree or order or (v) has
entered into any agreement, in each case relating to any alleged violation of
any Environmental Law or any actual or alleged release or threatened release or
cleanup at any location of any Hazardous Materials (as defined below) (as used
herein, "Environmental Law" means any federal, state, provincial, local or
foreign law, statute, ordinance, rule, regulation, order, decree, judgment,
injunction, permit, license, authorization or other binding requirement, or
common law, relating to health, safety or the protection, cleanup or restoration
of the environment or natural resources, including those relating to the
distribution, processing, generation, treatment, storage, disposal,
transportation, other handling or release or threatened release of Hazardous
Materials, and "Hazardous Materials" means any material (including, without
limitation, pollutants, contaminants, hazardous or toxic substances or wastes)
that is regulated by or may give rise to liability under any Environmental Law).

 
 
(y)
Taxes. The Corporation and its Subsidiary have paid all federal, state, local,
provincial and foreign taxes and filed all tax returns required to be filed
through the date hereof (except for (i) any taxes that are being disputed in
good faith by appropriate proceedings and for which the Corporation or the
Subsidiary, as appropriate, holds adequate reserves in accordance with GAAP and
(ii) those returns for which a request for extension has been filed); and there
is no material tax deficiency that has been, or could reasonably be expected to
be, asserted against the Corporation or the Subsidiary or any of their
respective properties or assets.

 
 
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(z)
Insurance. The Corporation and the Subsidiary maintain insurance covering their
respective properties, operations, personnel and businesses as the Corporation
reasonably deems adequate; such insurance insures against such losses and risks
to an extent which is adequate in accordance with customary industry practice to
protect the Corporation and the Subsidiary and their respective businesses; all
such insurance is fully in force on the date hereof and will be fully in force
at the Closing Time, as applicable; neither the Corporation nor any Subsidiary
has reason to believe that it will not be able to renew any such insurance as
and when such insurance expires.

 
 
(aa)
Termination of Contracts. Neither the Corporation nor the Subsidiary has sent or
received any communication regarding termination of, or intent not to renew, any
of the contracts or agreements referred to or described in the Documents, and no
such termination or non-renewal has been threatened by the Corporation or the
Subsidiary or, to the Corporation’s knowledge, any other party to any such
contract or agreement, except for such terminations or non-renewals which would
not, individually or in the aggregate, be reasonably expected to have a Material
Adverse Effect.

 
 
(bb)
Accounting Controls. The Corporation and the Subsidiary maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorization; (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with GAAP and to maintain accountability
for assets; (iii) access to assets is permitted only in accordance with
management’s general or specific authorization; and (iv) the recorded
accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.

 
 
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(cc)
Disclosure Controls; Sarbanes-Oxley Act. The Corporation has established and
maintains and evaluates "disclosure controls and procedures" (as such term is
defined in Rules 13a-15 and 15d-15 under the U.S. Exchange Act) and "internal
control over financial reporting" (as such term is defined in Rules 13a-15 and
15d-15 under the U.S. Exchange Act); such disclosure controls and procedures are
designed to ensure that material information relating to the Corporation,
including its consolidated subsidiaries, is made known to the Corporation's
Chief Executive Officer and its Chief Financial Officer by others within those
entities, and, except as disclosed in the Corporation’s filings with the SEC,
and as of the date of the Corporation’s most recent evaluation, such disclosure
controls and procedures are effective to perform the functions for which they
were established; to the Corporation's knowledge, the Corporation's independent
auditors and the Audit Committee of the Board of Directors of the Corporation
have been advised of: (i) all significant deficiencies, if any, in the design or
operation of internal control over financial reporting which could adversely
affect the Corporation's ability to record, process, summarize and report
financial data; and (ii) all fraud, if any, whether or not material, that
involves management or other employees who have a role in the Corporation's
internal control over financial reporting; all material weaknesses, if any, in
internal control over financial reporting have been identified to the
Corporation's independent auditors; since the date of the most recent evaluation
of such disclosure controls and procedures and internal control over financial
reporting, there have been no significant changes in internal control over
financial reporting or in other factors that could be reasonably expected to
significantly affect internal control over financial reporting, including any
corrective actions with regard to significant deficiencies and material
weaknesses, except for those that are disclosed in the Corporation's filings
with the SEC or those that are intended to remediate or otherwise improve upon
the Corporation's disclosure controls and procedures and internal control over
financial reporting; the principal executive officers (or their equivalents) and
principal financial officers (or their equivalents) of the Corporation have made
all certifications required by the Sarbanes-Oxley Act of 2002 (the
"Sarbanes-Oxley Act") and any related rules and regulations promulgated by the
SEC, and the statements contained in each such certifications, are complete and
correct in all material respects as of the dates such certifications were made;
the Corporation, the Subsidiary and the Corporation's directors and officers are
each in compliance in all material respects with all applicable effective
provisions of the Sarbanes-Oxley Act and the rules and regulations of the SEC
promulgated thereunder.

 
 
(dd)
Forward-Looking Statements. Each "forward-looking statement" (within the meaning
of Section 27A of the U.S. Securities Act or Section 21E of the U.S. Exchange
Act) contained the Documents, if any, has been made or reaffirmed with a
reasonable basis and in good faith.

 
 
(ee)
Statistical and Market-Related Data. All statistical or market-related data
included or incorporated by reference in the Documents, are based on or derived
from sources that the Corporation reasonably believes to be reliable and
accurate, and the Corporation has obtained the written consent to the use of
such data from such sources to the extent required.

 
 
(ff)
Corrupt Practices. Neither the Corporation nor the Subsidiary nor, to the
knowledge of the Corporation, any director, officer, agent, employee,
representative or affiliate of the Corporation or the Subsidiary is aware of or
has taken any action, directly or indirectly, that would result in a violation
by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and
the rules and regulations thereunder; and the Corporation, the Subsidiary and,
to the knowledge of the Corporation, its affiliates, have taken all steps
reasonably necessary to ensure continued compliance therewith.

 
 
(gg)
Money Laundering Laws. The operations of the Corporation and the Subsidiary are
and have been conducted at all times in compliance in all material respects with
applicable financial recordkeeping and reporting requirements of the Currency
and Foreign Transactions Reporting Act of 1970, as amended, and the applicable
and material money laundering statutes of all jurisdictions in which the
Corporation operates or has operated and the rules and regulations thereunder
(collectively, "Money Laundering Laws"); and no action, suit or proceeding by or
before any court or governmental agency, authority or body or any arbitrator or
non-governmental authority involving the Corporation or the Subsidiary with
respect to Money Laundering Laws is pending or, to the Corporation’s knowledge,
threatened.

 
 
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(hh)
OFAC. Neither the Corporation nor the Subsidiary nor, to the knowledge of the
Corporation, any director, officer, agent, employee or affiliate of the
Corporation or the Subsidiary is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Treasury
Department ("OFAC"); and the Corporation will not, directly or indirectly, use
the proceeds of the offering of the Offered Securities contemplated hereby, or
lend, contribute or otherwise make available such proceeds to the Subsidiary,
joint venture partner or other person or entity for the purpose of financing the
activities of any person currently subject to any U.S. sanctions administered by
OFAC.

 
 
(ii)
Dividends. The Subsidiary is not currently prohibited, directly or indirectly,
from paying any dividends to the Corporation, from making any other distribution
on the Subsidiary’s capital stock, from repaying to the Corporation any loans or
advances to the Subsidiary from the Corporation or from transferring any of the
Subsidiary’s property or assets to the Corporation.

 
 
(jj)
Preemptive Rights. The issuance and sale of the Offered Securities as
contemplated hereby will not cause any holder of any shares of capital stock,
securities convertible into or exchangeable or exercisable for capital stock or
options, warrants or other rights to purchase capital stock or any other
securities of the Corporation to have any right to acquire any shares of
preferred stock of the Corporation.

 
 
(kk)
U.S. Exchange Act Registration. The Common Shares are registered pursuant to
Section 12(g) of the U.S. Exchange Act, the Common Shares are quoted for trading
on the OTCBB and listed on the Exchange, and the Corporation has taken no action
designed to, or likely to have the effect of, terminating the registration of
the Common Shares under the U.S. Exchange Act, ending quotations of the Common
Shares on the OTCBB or delisting the Common Shares from the Exchange, nor has
the Corporation received any notification that the SEC, the OTCBB or the
Exchange is contemplating terminating such quotation, registration or listing.

 
 
(ll)
Brokers Fees. Except pursuant to this Agreement, neither the Corporation nor the
Subsidiary has incurred any liability for any finder’s or broker’s fee or
agent’s commission in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.

 
 
(mm)
No Price Stabilization. Neither the Corporation nor the Subsidiary nor any of
their respective directors, officers or, to the knowledge of the Corporation,
any of their affiliates or controlling persons, has taken, directly or
indirectly, any action designed to, or which has constituted or might reasonably
be expected to, cause or result in the stabilization or manipulation of the
price of any security of the Corporation to facilitate the sale or resale of the
Offered Securities.

 
 
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(nn)
Corporate Records. The minute books of the Corporation and the Subsidiary
representing all existing records of all meetings and actions of the board of
directors (including all committees of the board of directors) and stockholders
of the Corporation and the Subsidiary (collectively, the "Corporate Records")
through the date of the latest meeting and action have been furnished to the
Agents. All such Corporate Records are complete and accurately reflect, in all
material respects, all transactions referred to in such Corporate Records. There
are no material transactions, agreements or other actions that have been
consummated by the Corporation or the Subsidiary that are not properly approved
and/or recorded in the Corporate Records of the Corporation and the Subsidiary.

 
 
(oo)
Federal Reserve Board. Neither the Corporation nor the Subsidiary owns any
"margin securities" as that term is defined in Regulation U of the Board of
Governors of the Federal Reserve System (the "Federal Reserve Board"), and none
of the proceeds of the sale of the Offered Securities will be used, directly or
indirectly, for the purpose of purchasing or carrying any margin security, for
the purpose of reducing or retiring any indebtedness which was originally
incurred to purchase or carry any margin security or for any other purpose which
might cause any of the Offered Securities to be considered a "purpose credit"
within the meanings of Regulation T, U or X of the Federal Reserve Board.

 
 
(pp)
Rating Organization. As of the date of this Agreement there were not, and as of
the Closing Time, there will not be, any securities of or guaranteed by the
Corporation or the Subsidiary that are rated by a "nationally recognized
statistical rating organization," as that term is defined in Rule 436(g)(2)
promulgated under the U.S. Securities Act.

 
 
(qq)
U.S. Exchange Act Requirements. The Corporation has filed in a timely manner all
reports required to be filed pursuant to Sections 13(a), 13(e), 14 and 15(d) of
the U.S. Exchange Act during the preceding twelve (12) months.

 
 
(rr)
Transfer Agent.  Computershare Trust Company of Canada at its principal offices
in the City of Vancouver, British Columbia is the duly appointed registrar and
transfer agent of the Corporation with respect to its Common Shares and the
trustee pursuant to the Trust Indenture.

 
 
(ss)
Reporting Issuer in Canada. The Corporation is a "reporting issuer" in each of
the Qualifying Provinces within the meaning of the Canadian Securities Laws in
such provinces and is not in default of any requirement of Canadian Securities
Laws, except such as would not, individually or in the aggregate, be reasonably
expected to have a Material Adverse Effect.

 
 
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(tt)
Representations and Warranties.  The representations and warranties made by the
Corporation in the Purchase Agreements will be true and correct as of the date
at which they are made.

 
 
(uu)
Warrants. The Corporation has the corporate power and authority to issue the
Warrants and Broker Warrants and to perform its obligations thereunder. The
Warrants and Broker Warrants have been duly authorized and constitute valid and
binding obligations of the Corporation, enforceable against the Corporation in
accordance with their terms except (i) as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or similar laws of general
applicability affecting the rights of creditors generally, and (ii) as
enforceability of any indemnification or contribution provision may be limited
under the federal and state securities laws in the United States or under the
Canadian Securities Laws in Canada. The Warrant Shares and Brokers Shares have
been duly authorized and reserved for issuance, and when issued to the holder(s)
of the Warrants and Broker Warrants in accordance with the terms of the Warrants
and Broker Warrants against payment therefor, will be validly issued, fully paid
and nonassessable. The Warrant Shares and Broker Shares when issued upon
exercise of the Warrants and Broker Warrants will be free of statutory and
contractual preemptive rights, resale rights, rights of first refusal and
restrictions upon voting and transfer (except for applicable transfer
restrictions under the U.S. Securities Act and any applicable state securities
laws). The offering and issuance of the Warrants and Broker Warrants and the
Warrant Shares and Broker Shares are pursuant to an exemption from the
registration requirements of the U.S. Securities Act.

 
In addition to the foregoing representations and warranties, any certificate
signed by any officer of the Corporation or the Subsidiary and delivered to the
Agents in connection with the Offering shall be deemed to be a representation
and warranty by the Corporation to the Agents as to the matters covered thereby.
 
7.
Conditions

 
The obligations of the Agents hereunder shall be conditional upon the Agents
receiving, and the Agents shall have the right on the Closing Date on behalf of
Purchasers to withdraw all Purchase Agreements delivered and not previously
withdrawn by Purchasers unless the Agents receive, at the Closing Time:
 
 
(a)
a legal opinion of the Corporation's Canadian counsel (addressed to the Agents,
the Purchasers and the Agents' counsel) in form and substance satisfactory to
the Agents, acting reasonably, relating to the offering, issuance and sale of
the Offered Securities and the issuance of the Broker Warrants, Warrants Shares
and the Broker Shares, including, without limitation, the matters set forth in
Schedule B and as to all other legal matters, including compliance with
Applicable Securities Laws in the Selling Jurisdictions in Canada, in any way
connected with the offering, issuance, sale and delivery of the Offered
Securities and the issuance of the Debentures, Warrants, Broker Warrants,
Warrant Shares and Broker Shares as the Agents may reasonably request.

 

 
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It is understood that the Corporation's Canadian counsel may rely on the
opinions of local counsel acceptable to them as to matters governed by the laws
of jurisdictions other than British Columbia, Alberta and Ontario and on
certificates of officers of the Corporation, the transfer agent of the Common
Shares and the auditors of the Corporation as to relevant matters of fact.
 
 
(b)
a legal opinion of the Corporation's US counsel (addressed to the Agents and the
Purchasers), in form and substance satisfactory to the Agents, acting
reasonably, relating to the matters set forth in Schedule C and as to all other
legal matters as the Agents may reasonably request;

 
 
(c)
a legal opinion of the Corporation's counsel in Nevada (addressed to the Agents,
the Purchasers and the Agents' counsel) in form and substance satisfactory to
the Agents, acting reasonably, relating to the matters set forth in Schedule D
and as to all other legal matters as the Agents may reasonably request;

 
 
(d)
a certificate of the Corporation dated the Closing Date, addressed to the Agents
and the Purchasers and signed on the Corporation's behalf by any two senior
officers or directors of the Corporation satisfactory to the Agents, acting
reasonably, certifying that:

 
 
(i)
the Corporation has complied with and satisfied all terms and conditions of the
Transaction Documents on its part to be complied with or satisfied at or prior
to the Closing Time, other than those which have been waived in writing by the
Agents;

 
 
(ii)
the representations and warranties of the Corporation set forth in the
Transaction Documents are true and correct, in all material respects, at the
Closing Time, as if made at such time;

 
 
(iii)
no event of a nature referred to in Subsection 12(a), (b), (d) or (e) has
occurred or to the knowledge of such officers is pending, contemplated or
threatened;

 
 
(iv)
the Corporation has made and/or obtained, on or prior to the Closing Time, all
necessary filings, approvals, consents and acceptances of applicable regulatory
authorities, and under any applicable agreement or document to which the
Corporation is a party or by which it is bound, required for the execution and
delivery of the Transaction Documents, the offering and sale of the Offered
Securities and the issuance of the Warrant Shares, Broker Warrants and Broker
Shares in the Selling Jurisdictions and the consummation of the other
transactions contemplated hereby (subject to completion of filings with, and the
payment of fees to, certain regulatory authorities following the Closing Date);

 
 
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(v)
there have been no material changes to the Due Diligence Session Responses; and

 
 
(vi)
such other matters as may be reasonably requested by the Agents or the Agents'
counsel;

 
and the Agents shall have no knowledge to the contrary;
 
 
(e)
evidence satisfactory to the Agents, acting reasonably, that the Corporation has
obtained all necessary approvals of the Exchange for the issuance of the Offered
Securities, the Warrant Shares, the Broker Warrants and the Broker Shares;

 
 
(f)
definitive certificates representing, in the aggregate, all of the Offered
Securities subscribed for or purchased registered in such name or names as the
Agents shall notify the Corporation in writing not less than 24 hours prior to
the Closing Time, provided such certificates registered in such names may,
subject to receipt by the Corporation and the Trustee of a satisfactory
indemnity, be delivered in advance of the Closing Date to the Agents or such
other parties in such locations as the Agents may direct and the Agents and the
Corporation may agree;

 
 
(g)
executed copies of this Agreement and the Transaction Documents, each in form
and substance reasonably satisfactory to the Agents and the Agents' counsel;

 
 
(h)
evidence of registration of security interests created pursuant to the
Transaction Documents in form and substance satisfactory to the Agents and the
Agents' counsel;

 
 
(i)
such further and other documentation as may be contemplated by this Agreement or
the Transaction Documents that may reasonably be requested by the Agents or the
Agents' counsel; and

 
 
(j)
the Agents having completed due diligence with respect to the Corporation and
its Subsidiary that is satisfactory to the Agents, acting reasonably.

 
The foregoing conditions are for the sole benefit of the Agents and may be
waived in whole or in part by the Agents at any time and, without limitation,
the Agents shall have the right, prior to the Closing Time, on behalf of
potential subscribers, to withdraw all Purchase Agreements delivered and not
previously withdrawn or rescinded by such persons. If any of the foregoing
conditions are not met, the Agents may terminate their obligations under this
Agreement without prejudice to any other remedies they may have.

 
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8.
Closing

 
The issue and sale of the Offered Securities shall be completed at the Closing
Time at the offices of the Corporation's Canadian Counsel in Toronto or at such
other place as the Corporation and the Agents may agree. Subject to the
conditions set forth in Section 7, the Agents, on the Closing Date, shall
deliver to the Corporation:
 
 
(a)
all completed Purchase Agreements duly executed by the Purchasers (including any
applicable documents and schedules specifically referred to in the Purchase
Agreements), in form and substance reasonably satisfactory to the Corporation
and the Corporation's counsel; and

 
 
(b)
a wire transfer of funds to the Corporation in an amount equal to the aggregate
of all subscriptions for Offered Securities delivered to and accepted by the
Corporation;

 
against delivery by the Corporation of:
 
 
(c)
definitive certificates referred to in Subsection 7(f) representing, in the
aggregate, all of the Offered Securities subscribed for;

 
 
(d)
the certificates representing the Broker Warrants, as provided in Subsection
9(b) hereof; and

 
 
(e)
such further documentation as may be contemplated by this Agreement or that may
reasonably be requested by the Agents' counsel.

 
The Corporation may not reject any properly completed Purchase Agreement which
is in compliance with Applicable Securities Laws, unless the number of Offered
Securities subscribed for or purchased pursuant to all Purchase Agreements
tendered by the Agents exceeds the maximum number of Offered Securities to be
sold under this Agreement, in which case Purchase Agreements representing the
over-allotment shall, in consultation with the Agents, be rejected or accepted,
unless the acceptance of such Purchase Agreement may breach or violate any
Applicable Securities Laws.
 
9.
Fees

 
In consideration for its services hereunder, the Corporation agrees to:
 
 
(a)
pay to the Agents a fee equal to the amount of 6.0% of the aggregate gross
proceeds of the sale of the Units, and for which the subscription is accepted by
the Corporation, which aggregate fee of up to $180,000 shall be payable on the
Closing Date; and

 
 
(b)
issue to the Agents at the Closing Time an aggregate number of Broker Warrants
as is equal to 5.0% of the number of Warrants issued pursuant to the offering.

 
 
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The foregoing fee referred to in Subsection 9(a) may, at the sole option of the
Agents, be deducted from the aggregate gross proceeds of the sale of the Offered
Securities and withheld for the account of the Agents.
 
10.
Expenses

 
Whether or not the transactions contemplated herein shall be completed, all
costs and expenses of or incidental to the creation, issue, sale or distribution
of the Offered Securities shall be borne by the Corporation, including, without
limitation, all costs and expenses of or incidental to the private placement of
the Offered Securities, the fees and expenses of the Corporation's counsel,
agent counsel retained by the Corporation's counsel, the Corporation's auditors,
the Corporation's engineers, the Trustee, the reasonable out-of-pocket expenses
of the Agents, including, but not limited to, travel and road show expenses and
the Agents' legal fees (to a maximum of $40,000, exclusive of taxes) and
expenses, and all other costs and expenses relating to the transactions
contemplated herein.  In addition, the Corporation shall pay the Lead Agent a
corporate finance fee of $40,000, plus applicable taxes.
 
The foregoing fees referred to in Subsection 10 may, at the sole option of the
Lead Agent, be deducted from the aggregate gross proceeds of the sale of the
Offered Securities and withheld for the account of the Agents.
 
11.
Waiver

 
The Agents may, in respect of the Corporation, waive in whole or in part any
breach of, default under or non-compliance with any representation, warranty,
covenant, term or condition hereof, or extend the time for compliance therewith,
without prejudice to any of its rights in respect of any other representation,
warranty, covenant, term or condition hereof or any other breach of, default
under or non-compliance with any other representation, warranty, covenant, term
or condition hereof, provided that any such waiver or extension shall be binding
on the Agents only if the same is in writing.
 
12.
Termination Events

 
Each of the Agents may terminate their obligations hereunder, without any
liability on such Agent's part, by written notice to the Corporation, in the
event that after the date hereof and at or prior to the Closing Time:
 
 
(a)
any order to cease or suspend trading in any securities of the Corporation, or
prohibiting or restricting the distribution of the Offered Securities, the
Broker Warrants, the Warrant Shares or the Broker Shares is made, or proceedings
are announced, commenced or threatened for the making of any such order, by any
securities commission or similar regulatory authority, the Exchange or by any
other competent authority, and the same has not been rescinded, revoked or
withdrawn;

 
 
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(b)
any inquiry, investigation or other proceeding (whether formal or informal) in
relation to the Corporation or any of its directors or officers is announced or
commenced by any securities commission or similar regulatory authority, the
Exchange or by any other competent authority or any order is issued under or
pursuant to any statute of Canada or of any of the provinces of Canada, or any
other applicable law or regulatory authority (unless based on the activities or
alleged activities of the Agent or its agents), or there is any change of law,
regulation or policy or the interpretation or administration thereof, which, in
the sole opinion of the Agent, acting reasonably, materially adversely affects,
or may materially adversely affect, the Corporation, the trading in the Common
Shares or the distribution of the Offered Securities, the Broker Warrants, the
Warrant Shares or the Broker Shares;

 
 
(c)
there should develop, occur or come into effect or existence any event, action,
state, condition (including, without limitation, terrorism or accident) or major
financial occurrence of national or international consequence, or any action by
government, law or regulation, or any other such occurrence of any nature
whatsoever, which, in the sole opinion of the Agent, acting reasonably,
materially adversely affects or involves, or might be expected to materially
adversely affect or involve, the financial markets or the business, operations
or affairs of the Corporation;

 
 
(d)
there should occur any change, event, fact or circumstance (actual, contemplated
or threatened) of a nature referred to in Subsection 3(a) hereof or any
development that could result in such a change, event, fact or circumstance, any
of which, in the opinion of the Agent, as determined by the Agent in its sole
discretion, acting reasonably, could reasonably be expected to have a material
adverse effect on the business, operations or affairs of the Corporation or the
market price or value or the marketability of the Offered Securities, the Broker
Warrants, the Warrant Shares or the Broker Shares;

 
 
(e)
the Agent, acting reasonably, determines that the Corporation shall be in breach
of, default under or non-compliance with any material representation, warranty,
covenant, term or condition of this Agreement or the Purchase Agreements;

 
 
(f)
the Agent shall become aware, as a result of its due diligence review (including
the Due Diligence Session) or otherwise, of any adverse material information,
fact or change (determined solely by the Agent, acting reasonably) with respect
to the Corporation which had not been publicly disclosed or disclosed in writing
to the Agent prior to the date hereof or which occurred after the effective date
hereof but prior to the Closing Time; or

 
 
(g)
the state of the financial markets in Canada or the United States becomes such
that the Units cannot, in the opinion of the Agent, acting reasonably, be
profitably marketed,

 
in any of which cases, the Agent shall be entitled, at its option, to terminate
and cancel its obligations to the Corporation under this Agreement and the
obligations of any Purchaser under any Purchase Agreement.

 
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13.
Continuation of Termination Right

 
Each of the Agents may exercise any or all of the rights provided for in Section
7, Section 11 or Section 12 notwithstanding any material change, change, event
or state of facts and notwithstanding any act or thing taken or done by the
Agent or any inaction by the Agent, whether before or after the occurrence of
any material change, change, event or state of facts including, without
limitation, any act of the Agent related to the offering or continued offering
of the sale of the Offered Securities.  An Agent shall only be considered to
have waived or be estopped from exercising or relying upon any of its rights
under or pursuant to Section 7, Section 11 or Section 12 if such waiver or
estoppel is in writing and specifically waives or estops such exercise or
reliance.
 
14.
Exercise of Termination Right

 
Any termination pursuant to the terms of this Agreement shall be effected by
notice in writing delivered to the Corporation, with a copy to the other Agent,
prior to the Closing Time, provided that no termination shall discharge or
otherwise affect any obligation of the Corporation under Section 10, Section 15,
Section 16, Section 17, Section 18 or Section 19.  The rights of the Agents to
terminate their obligations hereunder are in addition to, and without prejudice
to, any other remedies they may have.
 
15.
Survival

 
All representations, warranties, covenants, terms and conditions herein or
contained in certificates or documents submitted pursuant to or in connection
with the transactions contemplated herein shall survive the payment by the
Agents for the Offered Securities and the issuance of the Offered Securities and
shall continue in full force and effect for the benefit of the Agents and the
Purchasers regardless of any investigation by or on behalf of the Agents with
respect thereto.
 
16.
Indemnity

 
The Corporation (the "Indemnitor") shall indemnify and save harmless the Agents
and their respective affiliates, shareholders, directors, officers, partners,
employees and agents (collectively, the "Indemnified Parties") from and against
all actual or threatened claims, demands, actions, suits, investigations and
proceedings (collectively, "Proceedings") and all losses (other than loss of
profits), costs, expenses, fees, damages, obligations, payments and liabilities
(collectively, "Liabilities") (including, without limitation, all statutory
duties and obligations, and, subject to Section 18, all amounts paid to
investigate, defend and settle any action or to satisfy any judgment or award
and all legal fees and disbursements actually incurred) which now or any time
hereafter are suffered or incurred by reason of any event, act or omission in
any way caused by, or arising directly or indirectly from or in consequence of:

 
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(a)
any information or statement contained in any part of the Public Record (other
than any information or statement relating solely to the Agents and furnished to
the Corporation by the Agents in writing expressly for inclusion in any part of
the Public Record) or contained in this Agreement or any certificate or other
document delivered by or on behalf of the Corporation to the Agents hereunder
which is or is alleged to be untrue or any omission or alleged omission to
provide any information or state any fact the omission of which makes or is
alleged to make any such information or statement untrue or misleading in light
of the circumstances in which it was made;

 
 
(b)
any misrepresentation or alleged misrepresentation (except a misrepresentation
which is based upon information relating to the Agents and furnished to the
Corporation by the Agents in writing expressly for inclusion in the Public
Record) contained in the Public Record;

 
 
(c)
any prohibition or restriction of trading in the securities of the Corporation
or any prohibition or restriction affecting the distribution of the Offered
Securities, the Warrants, the Broker Warrants, the Warrant Shares or the Broker
Shares (not based upon the activities or the alleged activities of the Agents or
the Selling Dealer Group members, if any) imposed by any of the Securities
Commissions, the SEC or any other competent authority;

 
 
(d)
any order made or any inquiry, investigation (whether formal or informal) or
other proceeding commenced or threatened by any of the Securities Commissions or
any other one or more competent authorities (not based upon the activities or
the alleged activities of the Agents or the Selling Dealer Group members, if
any) into the affairs of the Corporation or its Subsidiary or any of its
directors, officers or principal shareholders or relating to or affecting the
trading or distribution of the Offered Securities, the Warrants, the Broker
Warrants, the Warrant Shares or the Broker Shares;

 
 
(e)
any breach of, default under or non-compliance by the Corporation with any
representation, warranty, term or condition of the Transaction Documents or any
certificate or document, delivered pursuant thereto or any requirement of
Applicable Securities Laws; or

 
 
(f)
the exercise by any purchaser of Offered Securities of any contractual or
statutory right of rescission in connection with the purchase thereof,

 
provided that in the event and to the extent that a court of competent
jurisdiction in a final judgment from which no appeal can be made or a
regulatory authority in a final ruling from which no appeal can be made shall
determine that such Proceedings or Liabilities resulted solely from the
negligence, fraud or wilful misconduct of any Indemnified Party claiming
indemnity, this indemnity shall not apply to such Proceeding or Liability.
 
The Corporation hereby waives its right to recover contribution from the Agents
with respect to any liability of the Corporation by reason of or arising out of
any misrepresentation in the Documents or any part of the Public Record
provided, however, that such waiver shall not apply in respect of liability
caused or incurred by reason of or arising out of: (i) any misrepresentation
which is based upon information relating solely to the Agents contained in such
document and furnished in writing to the Corporation by the Agents expressly for
inclusion in such document; or (ii) any failure by the Agents to provide to
prospective purchasers of Offered Securities any document which the Corporation
is required to provide to such prospective purchasers and which the Corporation
has provided to the Agents to forward to such prospective purchasers.

 
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17.
Notice of Indemnity Claim

 
If any Proceeding is brought, instituted or threatened in respect of any
Indemnified Party which may result in a claim for indemnification under this
Agreement, such Indemnified Party shall promptly after receiving notice thereof
notify the Corporation of the nature of such claim  and the Corporation shall be
entitled (but not required) to assume conduct of the defence thereof and retain
counsel on behalf of the Indemnified Party who is satisfactory to the
Indemnified Party, acting reasonably, to represent the Indemnified Party in such
Proceeding and the Corporation shall pay the fees and disbursements of such
counsel and all other expenses of the Indemnified Party relating to such
Proceeding as incurred.  Failure to so notify the Corporation shall not relieve
the Corporation from liability except and only to the extent that the failure
materially prejudices the Corporation.  If the Corporation assumes conduct of
the defence for an Indemnified Party, the Indemnified Party shall fully
cooperate in the defence including without limitation the provision of
documents, appropriate officers and employees to give witness statements, attend
examinations for discovery, make affidavits, meet with counsel, testify and
divulge all information reasonably required to defend or prosecute the
Proceedings.
 
In any such Proceeding the Indemnified Party shall have the right to employ
separate counsel and to participate in the defence thereof if:
 
 
(a)
the Indemnified Party has been advised in writing by counsel that there may be a
reasonable legal defense available to the Indemnified Party that is different
from or in addition to those available to the Corporation or that a conflict of
interest exists or reasonably may exist which makes representation by counsel
chosen by the Corporation not advisable (in which case the Corporation shall not
have the right to assume the defense of such proceedings on behalf of the
Indemnified Person);

 
 
(b)
the Indemnitor shall not have undertaken the defense of such proceedings, or
indicated its intent to do so, and employed counsel within ten days after notice
of commencement of such proceedings; or

 
 
(c)
the employment of such counsel has been authorized by the Corporation in
connection with the defense of such proceeding;

 
in which event the fees and disbursements of such counsel (on a solicitor and
his client basis) shall be paid by the Corporation.  It being understood,
however, that the Corporation shall not, in connection with any one such action
or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate law firm
(in addition to any local counsel) in each jurisdiction for all such Indemnified
Parties.

 
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18.
Admission of Liability

 
No admission of liability and no settlement of any Proceeding shall be made by
the Corporation without the prior written consent of the Indemnified Parties
affected, such consent not to be unreasonably withheld.  No admission of
liability and no settlement of any Proceeding shall be made by an Indemnified
Party without the prior written consent of the Corporation and the other
Indemnified Parties affected, such consent not to be unreasonably withheld.
 
19.
Right of Contribution

 
In order to provide for just and equitable contribution in circumstances in
which the indemnification provided for in this Agreement is due in accordance
with its terms but is (in whole or in part), for any reason, held by a court to
be unavailable from the Corporation on grounds of policy or otherwise, each of
the Corporation and the party or parties seeking indemnification shall
contribute to the aggregate Liabilities (or Proceedings in respect thereof) to
which they may be subject or which they may suffer or incur:
 
 
(a)
in such proportion as is appropriate to reflect the relative benefit received by
the Corporation on the one hand and by the Agent on the other hand from the
offering of the Offered Securities; or

 
 
(b)
if the allocation provided by Subsection 19(a) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in Subsection 19(a) but also to reflect the relative fault
of the party or parties seeking indemnity, on the one hand, and the parties from
whom indemnity is sought, on the other hand, in connection with the statement,
omission, misrepresentation or alleged misrepresentation, order, inquiry,
investigation or other matter or thing which resulted in such Liabilities, as
well as any other relevant equitable considerations.

 
The relative benefits received by the Corporation, on the one hand, and the
Agent, on the other hand, shall be deemed to be in the same proportion that the
total proceeds of the Offering received by the Corporation (net of fees but
before deducting expenses) bear to the fees received by the Agent.
 
The amount paid or payable by the Indemnitor as a result of any Proceedings or
Liabilities shall, without limitation, include any legal or other expenses
reasonably incurred by the Indemnified Person in connection with investigating
or defending such Liabilities (or Proceedings in respect thereof), whether or
not resulting in any action, suit, proceeding or claim.
 
The Corporation agrees that it would not be just and equitable if contributions
pursuant to this Agreement were determined by pro rata allocation or by any
other method of allocation which does not take into account the equitable
considerations referred to in the immediately preceding sections.
 
Any liability of an Agent under this Section 19 shall be limited to the amount
paid to such Agent pursuant to Section 9(a).

 
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The rights to indemnity and right of contribution provided in the foregoing
sections shall be in addition to, and without prejudice to and not in derogation
of, any other right to contribution which the Indemnified Parties may have by
statute or otherwise at law or in equity.  Subject to Section 16, the Indemnitor
waives all rights of contribution that it may have against any Indemnified Party
relating to any Liability in respect of which the Indemnitor has agreed to
indemnify the Indemnified Parties hereunder.
 
It is the intention of the Corporation to constitute the Agents as trustee for
the Indemnified Parties for the purposes of Section 15, Section 16, Section 17,
Section 18 and Section 19 and the Agents shall be entitled, as trustee, to
enforce such covenants on behalf of any other Indemnified Parties and the Agents
agree to accept such trust and to hold and enforce such covenants on behalf of
such persons.
 
If any Proceeding is brought in connection with the transactions contemplated by
this Agreement and an Indemnified Party or other representative of the Agents is
required to testify in connection therewith or is required to respond to
procedures designed to discover information relating thereto, the Agents will
have the right to employ their own counsel in connection therewith, and the
reasonable fees and disbursements of such counsel in connection therewith as
well as its reasonable fees at the normal per diem rate for its directors,
officers, employees and agents involved in preparation for and attendance at
such Proceeding or in so responding and any other reasonable costs and
out-of-pocket expenses incurred by them in connection therewith will be paid by
the Corporation as they are incurred.
 
The obligations under the indemnity and right of contribution provided herein
shall apply whether or not the transactions contemplated by this Agreement are
completed and shall survive the completion of the transactions contemplated
under this Agreement and the termination of this Agreement.
 
20.
Entire Agreement

 
It is understood that the terms and conditions of this Agreement supersede any
previous verbal or written agreement between the Agents and the Corporation with
respect to the issuance of securities by the Corporation and including, without
limitation, the agreement constituted by the acceptance of the letter dated July
8, 2011 from the Agents to the Corporation.
 
21.
Authority to Bind Agents

 
The Corporation shall be entitled to and shall act on any notice, waiver,
extension or communication given by or on behalf of the Agents by the Lead
Agent, which shall represent the Agents and which shall have the authority to
bind the Agents in respect of all matters hereunder, except in respect of any
settlement under Sections 16, 17, 18 or 19 or any matter referred to in Sections
12, 13 or 14.
 
22.
Notices

 
Any notice or other communication to be given hereunder shall, in the case of
notice to be given to the Corporation, be addressed to:

 
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Gryphon Gold Corporation
711 – 675 West Hastings Street
Vancouver, British Columbia
V6B 1N2
Attention:         John L. Key
Telecopy No.:  (604) 608-3262
 
with a copy to:
 
Borden Ladner Gravis LLP
40 King Street West
44th Floor
Toronto, Ontario
M5H 3Y4
Attention:         Philippe Tardif
Telecopy No.:  (416) 367-6749
 
with a copy to:
 
Dorsey & Whitney LLP
1400 Wewatta Street, Suite 400
Denver, Colorado
80202
Attention:         Kenneth Sam
Telecopy No.:  (303) 629-3450
 
and, in the case of notice to be given to the Agents, be addressed to:
 
Acumen Capital Finance Partners Limited.
Suite 700, 404 – 6th Avenue S.W.
Calgary, Alberta
T2P 0R9
Attention:         Kelly Hughes
Telecopy No.:  (403) 571-0310

and to:

Roth Capital Partners, LLC
24 Corporate Plaza Drive,
Newport Beach, California
92660
Attention:         John Dalphonsi
Telecopy No.: (310) 445-5864

 
- 36 -

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with a copy to:
 
Blake, Cassels & Graydon LLP
Suite 3500, Bankers Hall East
855 – 2nd Street S.W.
Calgary, Alberta
T2P 4J8
Attention:         William Van Horne
Telecopy No.:  (403) 260-9700
 
or to such other address as the party may designate by notice given to the
others. Each communication shall be personally delivered to the addressee or
sent by facsimile transmission to the addressee, and:
 
 
(a)
a communication which is personally delivered shall, if delivered before 4:30
p.m. (local time) on a business day, be deemed to be given and received on that
day and, in any other case be deemed to be given and received on the first
business day following the day on which it is delivered; and

 
 
(b)
a communication which is sent by facsimile transmission shall, if sent on a
business day before 4:30 p.m. (local time), be deemed to be given and received
on that day and, in any other case, be deemed to be given and received on the
first business day following the day on which it is sent.

 
23.
Trust

 
The Corporation hereby constitutes the Agents as trustee for the Purchasers in
respect of the benefit of the representations, warranties and covenants of the
Corporation set forth in this Agreement, and the Agents shall be entitled, as
trustee, in addition to any rights of the Purchasers, to enforce such
representations, warranties and covenants on behalf of the Purchasers.
 
24.
Acknowledgement and Consent

 
The Corporation: (i) acknowledges and agrees that the Agents have certain
statutory obligations as a registrant under the Applicable Securities Laws and
have relationships with their clients; and (ii) consents to the Agents acting
hereunder while continuing to act for their clients. To the extent that the
Agents' statutory obligations as a registrant under Applicable Securities Laws
or relationships with their clients conflict with their obligations hereunder,
the Agents shall be entitled to fulfil their statutory obligations as a
registrant under Applicable Securities Laws and their duties to their
clients.  Nothing in this Agreement shall be interpreted to prevent the Agents
from fulfilling their statutory obligations as a registrant under Applicable
Securities Laws or to act for their clients.

 
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25.
Severance

 
If one or more of the provisions contained herein shall, for any reason, be held
to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement, but this Agreement shall be construed as if such invalid, illegal or
unenforceable provision or provisions had never been contained herein.
 
26.
Governing Law

 
This Agreement shall be governed by and construed in accordance with the laws of
the Province of British Columbia and the laws of Canada applicable therein.
 
27.
Time of the Essence

 
Time shall be of the essence of this Agreement.
 
28.
Counterpart Execution

 
This Agreement may be executed in one or more counterparts each of which so
executed shall constitute an original and all of which together shall constitute
one and the same agreement.
 
29.
U.S. Securities Law Matters

 
Each Agent, severally and not jointly, and the Corporation agree as follows:
 
 
(a)
The Agents acknowledge that none of the Offered Securities, Warrant Shares,
Broker Warrants or Broker Warrant Shares have been or will be registered with
the SEC under the U.S. Securities Act or the securities laws of any state of the
United States. Each Agent represents and warrants that the Offered Securities
are being offered and sold pursuant to the exemption from the registration
requirements of the U.S. Securities Act provided by Section 4(2) and Rule 506 of
Regulation D thereunder and in accordance with any applicable state securities
laws of the United States.  Each Agent represents and warrants that it has not
offered and will not offer any of the Offered Securities except in compliance
with this Section 29.

 
 
(b)
Each Agent shall require each Selling Dealer Group member to agree, for the
benefit of the Corporation, to comply with, and shall use its best efforts to
ensure that each Selling Dealer Group member complies with, the applicable
provisions of this Section 29 as if such provisions applied to the Selling
Dealer Group member.

 
 
(c)
Each Agent represents and agrees that neither the Agent, nor its affiliates nor
any person acting on its or their behalf has taken or will take any action that
would constitute a violation of Regulation M under the U.S. Exchange Act in
connection with the offer and sale of the Offered Securities.

 
 
- 38 -

--------------------------------------------------------------------------------

 
 
 
(d)
Each Agent agrees that all offers and solicitations of offers in the United
States shall be made by the U.S. Agent in compliance with all applicable federal
and state laws and regulations governing the registration and conduct of
broker-dealers and that the U.S. Agent was, is and will be, at the time of any
such offer and subsequent sale by the Corporation, duly registered as a
broker-dealer pursuant to Section 15(b) of the U.S. Exchange Act and under the
laws of each applicable state of the United States (unless exempted from the
respective state's broker-dealer registration requirements), and in good
standing with the Financial Industry Regulatory Authority, Inc.

 
 
(e)
The Corporation and the Agents agree that the Offered Securities may be offered
by the Agents and sold directly by the Corporation pursuant to Section 4(2) and
Rule 506 of Regulation D thereunder (and similar exemptions under applicable
state securities laws), and only to persons whom the Agents had a reasonable
basis to believe and do believe to be Accredited Investors and, in each case, on
the Closing Date, continue to believe are Accredited Investors.

 
 
(f)
The Agents agree not to offer or sell, or to solicit any offer to buy, Offered
Securities by any form of General Solicitation or General Advertising or in any
manner involving a public offering within the meaning of Section 4(2) of the
U.S. Securities Act.

 
 
(g)
The Agents agree that offers to sell, solicitations of offers to buy and sales
of the Offered Securities in the United States shall be made only by the U.S.
Agent in accordance with the registration or qualification requirements of
applicable U.S. state securities ("Blue Sky") laws, in accordance with the
applicable U.S. federal and state requirements relating to the registration of
brokers and dealers.

 
 
(h)
The Agents agree that offers to sell, solicitations of offers to buy and sales
of the Offered Securities shall be made only to persons reasonably believed to
be Accredited Investors who, prior to the sale and delivery of the Offered
Securities to them, execute and deliver a Purchase Agreement in the form agreed
upon by the Corporation and the Agents.

 
 
(i)
The Agents agree to inform each Purchaser that the Offered Securities and
Warrant Shares have not been and will not be registered under the U.S.
Securities Act or the securities laws of any state in the United States and that
the Offered Securities are being offered and sold in reliance upon exemptions
from the registration requirement of Section 5 of the U.S. Securities Act
provided by Section 4(2) of the U.S. Securities Act and Rule 506 of Regulation D
thereunder and in accordance with applicable state securities laws.

 
 
(j)
The Corporation represents and agrees that none of it, its affiliates, or any
person acting on behalf of it or its affiliates (other than the Agents and any
person acting on any of their behalf as to which the Corporation makes no
representation or agreement):

 
 
- 39 -

--------------------------------------------------------------------------------

 
 
 
(i)
has taken or will take any action that would (A) cause the exemptions from
registration afforded by Section 4(2) and Rule 506 of Regulation D thereunder to
be unavailable for offers and sales of the Offered Securities pursuant to this
Agreement; or (B) constitute a violation of Regulation M under the U.S. Exchange
Act in connection with the offer and sale of the Offered Securities; and

 
 
(ii)
has engaged or will engage in any General Solicitation or General Advertising or
has acted or will act in any manner involving a public offering under the
meaning of Section 4(2) of the U.S. Securities Act.

 
 
(k)
Within the six-month period prior to the commencement of the Offering through
the six-month period following the Closing Date, the Corporation has not, and
will not, as applicable, offered or sold or offer or sell any Offered Securities
or other securities of the Corporation in a manner that would be integrated with
the offer and sale of Offered Securities and would cause the exemption from
registration set forth in Section 4(2) and Rule 506 of Regulation D thereunder
to become unavailable with respect to any offers and sales of Offered Securities
pursuant to this Agreement.

 
 
(l)
None of the Corporation or any of its predecessors or affiliates has had the
registration of a class of securities under the U.S. Exchange Act revoked by the
SEC pursuant to Section 12(j) of the U.S. Exchange Act and any rules or
regulations promulgated thereunder.

 
 
(m)
None of the Corporation or any of its predecessors or affiliates has been
subject to any order, judgment or decree of any court of competent jurisdiction
temporarily, preliminarily or permanently enjoining such person for failure to
comply with Rule 503 of Regulation D.

 
 
(n)
The Corporation shall duly prepare and file with the SEC a Form D within 15 days
after the first sale of Offered Securities, and will also file, within the
prescribed time periods, such notices and any other documents as are required to
be filed under the state securities or "blue sky" laws of the states in which
the Offered Securities are sold to satisfy the requirements of applicable
exemptions from registration or qualification of the Offered Securities under
such laws.

 
 
(o)
The Lead Agent has not entered, and will not enter, into any contractual
arrangements with respect to the distribution of the Offered Securities in the
United States other than with the U.S. Agent, or with the prior consent of the
Corporation.

 
 
(p)
The Agents will deliver to all offerees and Purchasers of the Offered Securities
the same information relating to the Corporation (which information may include
the Transaction Documents and the Documents) and the Agents agree that they have
not and will not use any written material other than such documents in
connection therewith.

 
 
- 40 -

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(q)
At least one business day prior to the Closing Date, the Agents shall provide
the Corporation with a list of all purchasers of Offered Securities in the
United States and all purchasers who were offered Offered Securities in the
United States.

 
 
(r)
Each Agent acknowledges that until 40 days after the commencement of the
Offering, an offer or sale of the Offered Securities within the United States by
any dealer (whether or not participating in the Offering) may violate the
registration requirements of the U.S. Securities Act if such offer or sale is
made otherwise than in accordance with an exemption from the registration
requirements of the U.S. Securities Act.

 
 
(s)
Notwithstanding the foregoing provisions of this section, an Agent will not be
liable to the Corporation under this section with respect to a violation by
another Agent of the provisions of this section if the former Agent is not
itself also in violation.

 
 
- 41 -

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If the foregoing is in accordance with your understanding and is agreed to by
you, please confirm your acceptance by signing the enclosed copies of this
letter at the place indicated and by returning the same to Kelly Hughes at
Acumen Capital Partners Limited Finance.

 
ACUMEN CAPITAL FINANCE
PARTNERS LIMITED
   
Per:
 
Name:
Kelly Hughes
Title:
Vice-President, Investment Banking
   
ROTH CAPITAL PARNTERS, LLC
   
Per:
 
Name:
John Dalfonsi
Title:
Managing Director, Investment Banking

 
ACCEPTED AND AGREED to effective as of the 8th day of July, 2011.
 
GRYPHON GOLD CORPORATION
   
Per:
  
Name:
John L. Key
Title:
Chief Executive Officer

 
 
- 42 -

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SCHEDULE A
   
FORM OF BROKER WARRANT

 
THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933,
AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES,
AGREES FOR THE BENEFIT OF THE COMPANY THAT SUCH SECURITIES MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY, EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT AND, IN EACH CASE, IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AND, IF REQUESTED BY THE
COMPANY, THE SELLER FURNISHES TO THE COMPANY AN OPINION OF COUNSEL OF RECOGNIZED
STANDING IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY TO SUCH
EFFECT.

 
UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST
NOT TRADE THE SECURITY BEFORE NOVEMBER 27, 2011.

 
THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN AND
WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “U.S. SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES.  THIS WARRANT MAY NOT BE EXERCISED UNLESS THE WARRANT AND THE
UNDERLYING SHARES HAVE BEEN REGISTERED UNDER THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION
REQUIREMENTS IS AVAILABLE, AND THE HOLDER HAS DELIVERED AN OPINION OF COUNSEL OR
OTHER EVIDENCE OF EXEMPTION IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE
CORPORATION TO SUCH EFFECT.

 
THESE WARRANTS WILL EXPIRE AND BECOME NULL AND VOID
 
AT 5:00 P.M. (VANCOUVER TIME) ON JANUARY 26, 2013.
 
[•] BROKER WARRANTS
 
TO PURCHASE SHARES OF COMMON STOCK
 
GRYPHON GOLD CORPORATION
 
incorporated in the State of Nevada
 
THIS IS TO CERTIFY THAT [•] (the “Holder”), has the right to purchase, upon and
subject to the terms and conditions hereinafter referred to, up to [•] fully
paid and non-assessable shares of common stock (the “Shares”) in the capital of
Gryphon Gold Corporation (hereinafter called the “Company”) on or before
5:00 p.m. (Vancouver time) on January 26, 2013 (the “Expiry Date”) at a price
per Share (the “Exercise Price”) of US$0.20, on the terms and conditions
attached hereto as Appendix “A” (the “Terms and Conditions”).
 
 
1.
ONE (1) WHOLE BROKER WARRANT AND THE EXERCISE PRICE ARE REQUIRED TO PURCHASE ONE
SHARE.  THIS CERTIFICATE REPRESENTS [•] BROKER WARRANTS.

 
 
 

--------------------------------------------------------------------------------

 
 
 
2.
These Warrants are issued subject to the Terms and Conditions, and the Warrant
Holder may exercise the right to purchase Shares only in accordance with those
Terms and Conditions.

 
 
3.
Nothing contained herein or in the Terms and Conditions will confer any right
upon the Holder hereof or any other person to subscribe for or purchase any
Shares at any time subsequent to the Expiry Date, and from and after such time,
these Warrants and all rights hereunder will be void and of no value.

 
 
IN WITNESS WHEREOF the Company has executed this Warrant Certificate this 26th
day of July, 2011.

 
GRYPHON GOLD CORPORATION
 
 
Per:

 
John L. Key, Chief Executive Officer

 
 
- 2 -

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PLEASE NOTE THAT ALL SHARE CERTIFICATES MUST BE LEGENDED AS FOLLOWS DURING THE
CURRENCY OF APPLICABLE HOLD PERIODS:

 
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) OR THE
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF,
BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE COMPANY THAT SUCH
SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY
OR INDIRECTLY, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
U.S. SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES
ACT AND, IN EACH CASE, IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AND,
IF REQUESTED BY THE COMPANY, THE SELLER FURNISHES TO THE COMPANY AN OPINION OF
COUNSEL OF RECOGNIZED STANDING IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO
THE COMPANY TO SUCH EFFECT.

 
UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST
NOT TRADE THE SECURITY BEFORE NOVEMBER 27, 2011.

 
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE LISTED ON THE TORONTO STOCK
EXCHANGE (“TSX”); HOWEVER, THE SAID SECURITIES CANNOT BE TRADED THROUGH THE
FACILITIES OF TSX SINCE THEY ARE NOT FREELY TRANSFERABLE, AND, CONSEQUENTLY, ANY
CERTIFICATE REPRESENTING SUCH SECURITIES IS NOT “GOOD DELIVERY” IN SETTLEMENT OF
TRANSACTIONS ON TSX.

 
- 3 -

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APPENDIX “A”

 
TERMS AND CONDITIONS dated July 26, 2011, attached to the Broker Warrants issued
by Gryphon Gold Corporation
 
1.
INTERPRETATION

 
1.1 
Definitions

 
In these Terms and Conditions, unless there is something in the subject matter
or context inconsistent therewith:
 
 
(a)
“Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday which
is not a day on which banking institutions in New York, New York are generally
authorized or obligated by law or executive order to close;

 
 
(b)
“Company” means Gryphon Gold Corporation until a successor corporation will have
become such as a result of consolidation, amalgamation or merger with or into
any other corporation or corporations, or as a result of the conveyance or
transfer of all or substantially all of the properties and estates of the
Company as an entirety to any other corporation and thereafter “Company” will
mean such successor corporation;

 
 
(c)
“Company’s Auditors” means an independent firm of accountants duly appointed as
auditors of the Company;

 
 
(d)
“Director” means a director of the Company for the time being, and reference,
without more, to action by the directors means action by the directors of the
Company as a Board, or whenever duly empowered, action by an executive committee
of the Board;

 
 
(e)
“Eligible Market” means any of NYSE, the NYSE Amex, The NASDAQ Global Market,
The NASDAQ Global Select Market, The NASDAQ Capital Market or the Toronto Stock
Exchange;

 
 
(f)
“herein”, “hereby” and similar expressions refer to these Terms and Conditions
as the same may be amended or modified from time to time; and the expression
“Article” and “Section,” followed by a number refer to the specified Article or
Section of these Terms and Conditions;

 
 
(g)
“person” means an individual, corporation, partnership, trustee or any
unincorporated organization and words importing persons have a similar meaning;

 
 

--------------------------------------------------------------------------------

 
 
 
(h)
“shares” means the common shares in the capital of the Company as constituted at
the date hereof and any shares resulting from any subdivision or consolidation
of the shares;

 
 
(i)
“Trading Day” shall mean (a) any day on which the Common Stock is listed or
quoted and traded on its primary Trading Market, (b) if the Common Stock is not
then listed or quoted and traded on any Eligible Market, then a day on which
trading occurs on the OTC Bulletin Board (or any successor thereto), or (c) if
trading does not occur on the OTC Bulletin Board (or any successor thereto), any
Business Day;

 
 
(j)
“Trading Market” shall mean the OTC Bulletin Board or any Eligible Market or any
other national securities exchange, market or trading or quotation facility on
which the shares are then listed or quoted; and

 
 
(k)
“Warrants” means the broker warrants of the Company issued and presently
authorized and for the time being outstanding.

 
1.2 
Gender

 
Words importing the singular number include the plural and vice versa and words
importing the masculine gender include the feminine and neuter genders.
 
1.3 
Interpretation not affected by Headings

 
The division of these Terms and Conditions into Articles and Sections, and the
insertion of headings are for convenience of reference only and will not affect
the construction or interpretation thereof.
 
1.4 
Applicable Law

 
The Warrants will be construed in accordance with the laws of the State of New
York without regard to its conflicts of law principles, and the federal law of
the United States of America. The Company and Holder each irrevocably consents
to the jurisdiction of the courts of the State of New York in connection with
any action or proceeding arising out of, or relating to, these Warrants, any
document or instrument delivered pursuant to, in connection with, or
simultaneously with these Warrants, or a breach of the Terms and Conditions of
these Warrants or any such document or instrument.

 
- 2-

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1.5 
Severability

In the event that any one or more of the provisions contained in this Warrant
Certificate or in any other document referenced in this Warrant Certificate
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this Warrant Certificate or any other such document.
 
1.6 
Time is of the Essence

Time is absolutely of the essence in construing each provision of this Warrant
Certificate.
 
2.
ISSUE OF WARRANTS

 
2.1 
Additional Warrants

 
The Company may at any time and from time to time issue additional warrants or
grant options or similar rights to purchase shares of its capital stock.
 
2.2 
Warrants to Rank Pari Passu

 
All Warrants and additional warrants, options or similar rights to purchase
shares from time to time issued or granted by the Company, will rank pari passu
whatever may be the actual dates of issue or grant thereof, or of the dates of
the certificates by which they are evidenced.
 
2.3 
Issue in substitution for Lost Warrants

 
 
(a)
In case a Warrant Certificate becomes mutilated, lost, destroyed or stolen, the
Company, at its discretion, may issue and deliver a new Warrant Certificate of
like date and tenor as the one mutilated, lost, destroyed or stolen, in exchange
for and in place of and upon cancellation of such mutilated Warrant Certificate,
or in lieu of, and in substitution for such lost, destroyed or stolen Warrant
Certificate and the substituted Warrant Certificate will be entitled to the
benefit hereof and rank equally in accordance with its terms with all other
Warrants issued or to be issued by the Company.

 
 
(b)
The applicant for the issue of a new Warrant Certificate pursuant hereto will
bear the cost of the issue thereof and in case of loss, destruction or theft
furnish to the Company such evidence of ownership and of loss, destruction, or
theft of the Warrant Certificate so lost, destroyed or stolen as will be
satisfactory to the Company in its discretion and such applicant may also be
required to furnish indemnity in amount and form satisfactory to the Company in
its discretion, and will pay the reasonable charges of the Company in connection
therewith.

 
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2.4 
Warrant Holder Not a Shareholder

 
The holding of a Warrant will not constitute the Holder thereof a shareholder of
the Company, nor entitle him to any right or interest in respect thereof except
as in the Warrant Certificate expressly provided.
 
3.
NOTICE

 
3.1 
Notice to Holders

 
Any notice required or permitted to be given to the Holders will be in writing
and may be given by prepaid registered post, electronic facsimile transmission,
portable document format (pdf) transmission or other means of electronic
communication capable of producing a printed copy to the address of the Holder
appearing on the Holder’s Warrant Certificate or to such other address as any
Holder may specify by notice in writing to the Company, and any such notice will
be deemed to have been given and received by the Holder to whom it was addressed
if mailed, on the third day following the mailing thereof, if by facsimile, pdf
or other electronic communication, on successful transmission, or, if delivered,
on delivery; but if at the time of mailing or between the time of mailing and
the third business day thereafter there is a strike, lockout, or other labour
disturbance affecting postal service, then the notice will not be effectively
given until actually delivered.
 
3.2 
Notice to the Company

 
Any notice required or permitted to be given to the Company will be in writing
and may be given by prepaid registered post, electronic facsimile transmission,
portable document format (pdf) transmission or other means of electronic
communication capable of producing a printed copy to the address of the Company
set forth below or such other address as the Company may specify by notice in
writing to the Holder, and any such notice will be deemed to have been given and
received by the Company to whom it was addressed if mailed, on the third day
following the mailing thereof, if by facsimile, pdf or other electronic
communication, on successful transmission, or, if delivered, on delivery; but if
at the time or mailing or between the time of mailing and the third business day
thereafter there is a strike, lockout, or other labour disturbance affecting
postal service, then the notice will not be effectively given until actually
delivered:
 
Gryphon Gold Corporation
Suite 711, 675 West Hastings Street

Vancouver, B.C.
Canada  V6B 1N2

Attention:  Lisanna Lewis

Fax No. (604) 608-3262

 
- 4-

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4.
EXERCISE OF WARRANTS

 
4.1 
Method of Exercise of Warrants

 
 
(a)
The right to purchase shares conferred by the Warrants may be exercised by the
Holder surrendering the Warrant Certificate representing same, with a duly
completed and executed Form of Subscription in the form attached hereto and a
bank draft or certified cheque payable to or to the order of the Company, at
par, in Vancouver, BC, Canada, for the purchase price applicable at the time of
surrender in respect of the shares subscribed for in lawful money of the United
States of America, to the Company at the address set forth in, or from time to
time specified by the Company pursuant to, Section 3.2.

 

 
(b) 
Net Issue Exercise.

 
 
 
(i)
Section 4.1(b)(ii) shall not apply and shall have no force or effect if the
shares issuable upon exercise of these Warrants have been registered for resale
under the Securities Act of 1933, as amended (the “1933 Act”), on a Registration
Statement on Form S-1, S-3, or another appropriate form and such Registration
Statement remains effective under the 1933 Act and available for use by Holder
at the time of exercise or the shares issuable upon exercise of these Warrants
may otherwise be immediately resold upon exercise pursuant to available
exemptions from the 1933 Act and any applicable securities laws of any state of
the United States.

 
 
(ii)
Subject to Section 4.1(b)(i), if, at any time after the issuance of these
Warrants but prior to the Expiry Date, the Fair Market Value of one share is
greater than the Exercise Price, in lieu of exercising these Warrants for cash,
the Holder may elect to receive shares equal to the value (as determined below)
of these Warrants (or the portion thereof being exercised) by surrender of this
Warrant Certificate at the principal office of the Company with a duly completed
and executed Form of Subscription in the form attached hereto in which event the
Company shall issue to the Holder a number of shares computed using the
following formula:

X = (Y (A - B)) / A
 
Where X = the number of shares to be issued to Holder
 
Y = the number of shares purchasable under the Warrants or, if only a portion of
the Warrants are being exercised, the portion of the Warrants being exercised
(at the date of such calculation)
 
A = the Fair Market Value of one share (at the date of such calculation)
 
B = Exercise Price (at the date of such calculation)

 
- 5-

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For purposes of the above calculation, the “Fair Market Value” of one share
shall mean (i) the average of the closing sales prices for the shares on the
Eligible Market on which the shares are listed or traded as reported by
Bloomberg Financial Markets (or a comparable reporting service of national
reputation selected by the Company and reasonably acceptable to the Holder if
Bloomberg Financial Markets is not then reporting sales prices of such security)
(collectively, “Bloomberg”) for the ten (10) consecutive Trading Days
immediately prior to the Exercise Date, or (ii) if an Eligible Market is not the
principal Trading Market for the shares, the average of the reported sales
prices reported by Bloomberg on the principal Trading Market for the shares
during the same period, or, if there is no sales price for such period, the last
sales price reported by Bloomberg for such period, or (iii) if neither of the
foregoing applies, the last sales price of such security in the over-the-counter
market on the pink sheets or bulletin board for such security as reported by
Bloomberg, or if no sales price is so reported for such security, the last bid
price of such security as reported by Bloomberg, or (iv) if fair market value
cannot be calculated as of such date on any of the foregoing bases, the fair
market value shall be as determined by the Board of Directors of the Company in
the exercise of its good faith judgment.
 
4.2 
Effect of Exercise of Warrants

 
 
(a)
Upon surrender and payment (unless exercise is pursuant to Section 4.1(b)(ii))
as aforesaid the shares so subscribed for will be deemed to have been issued and
such person or persons will be deemed to have become the Holder or Holders of
record of such shares on the date of such surrender and payment, and such shares
will be issued based on the Exercise Price in effect on the date of such
surrender and payment.

 
 
(b)
Within ten (10) business days after surrender and payment (unless exercise is
pursuant to Section 4.1(b)(ii)) as aforesaid, the Company will forthwith cause
to be delivered to the person or persons in whose name or names the Shares so
subscribed for are to be issued as specified in such Form of Subscription or
mailed to him or them at his or their respective addresses specified in such
Form of Subscription, a certificate or certificates for the appropriate number
of Shares not exceeding those which the Holder is entitled to purchase pursuant
to the Warrant Certificate surrendered.

 
4.3 
Restrictions on Exercise of Warrants

The Warrants represented by this Warrant Certificate may only be exercised by or
for the account or benefit of a holder who, at the time of exercise, either:

 
(a)
represents to the Company, pursuant to subparagraph 1 of the attached Form of
Subscription, that (i) the holder was the original subscriber for the Warrants
from the Company, and (ii) the representations, warranties and covenants set
forth in the debenture and warrant purchase agreement pursuant to which the
holder purchased the Warrants from the Company (the “Purchase Agreement”) are
true and correct on the date of exercise in relation to the exercise of the
Warrants, including, without limitation, the representations and warranties in
the U.S. Accredited Investor Questionnaire attached to the Purchase Agreement as
Exhibit H; or

 
- 6-

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(b)
provides, pursuant to subparagraph 2 of the attached Form of Subscription, a
written opinion of counsel or other evidence of exemption in form and substance
reasonably satisfactory to the Company that the Shares to be delivered upon
exercise of the Warrants have been registered under the 1933 Act and the
securities laws of all applicable states of the United States or are exempt from
such registration requirements.

 
4.4 
Subscription for Less Than Entitlement

 
The Holder of any Warrant may subscribe for and purchase a number of shares less
than the number which he is entitled to purchase pursuant to the surrendered
Warrant Certificate. In the event of any purchase of a number of shares less
than the number which can be purchased pursuant to a Warrant Certificate, the
Holder thereof upon exercise thereof will in addition be entitled to receive a
new Warrant Certificate in respect of the balance of the shares which he was
entitled to purchase pursuant to the surrendered Warrant Certificate and which
were not then purchased.
 
4.5 
Warrants for Fractions of Shares

 
To the extent that the Holder of any Warrant is entitled to receive on the
exercise or partial exercise thereof a fraction of a share, such right may be
exercised in respect of such fraction only in combination with another Warrant
or other Warrants which in the aggregate entitle the Holder to receive a whole
number of such shares.
 
4.6 
Expiration of Warrants

 
After the expiration of the period within which a Warrant is exercisable, all
rights thereunder will wholly cease and terminate and such Warrant will be void
and of no effect.
 
4.7 
Exercise Price; Beneficial Ownership Limitation

 
Each whole Warrant is exercisable at a price per share (the “Exercise Price”) of
US$0.20 if exercised on or before 5:00 p.m. (Vancouver time) on January 26,
2013.  One (1) Warrant and the Exercise Price are required to subscribe for each
Share during the term of the Warrants.

 
- 7-

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Notwithstanding any other provision hereof, no Holder shall exercise Warrants if
as a result of such exercise the Holder would then become a “ten percent
beneficial owner” (as defined in Rule 16a-2 under the Securities Exchange Act of
1934, as amended) of Shares.  For greater certainty, the Warrants shall not be
exercised by the Holder, and the Company shall not give effect to any exercise
of Warrants, if, after giving effect to such exercise, the Holder of such
securities, together with its affiliates, would in aggregate beneficially own,
or exercise control or direction over that number of voting securities of the
Company which is 10% or greater of the total issued and outstanding voting
securities of the Company, immediately after giving effect to such exercise.
 
For purposes of the foregoing paragraph, the number of Shares beneficially owned
by the Holder and its affiliates shall include the number of Shares issuable
upon exercise of these Warrants with respect to which such determination is
being made, but shall exclude the number of Shares which would be issuable upon
(i) exercise of the remaining, nonexercised portion of these Warrants
beneficially owned by the Holder or any of its affiliates and (ii) exercise or
conversion of the unexercised or nonconverted portion of any other securities of
the Company subject to a limitation on conversion or exercise analogous to the
limitation contained herein beneficially owned by the Holder or any of its
affiliates. Except as set forth in the preceding sentence, for purposes of this
Section 4.7, beneficial ownership shall be calculated in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder. To the extent that the limitation contained
in this Section 4.7 applies, the determination of whether these Warrants are
exercisable (in relation to other securities owned by the Holder together with
any affiliates) and of which portion of these Warrants is exercisable shall be
in the sole discretion of the Holder, and the submission of a Form of
Subscription shall be deemed to be the Holder’s determination of whether these
Warrants are exercisable (in relation to other securities owned by the Holder
together with any affiliates) and of which portion of these Warrants is
exercisable, in each case subject to the “ten percent beneficial owner”
limitation, and the Company shall have no obligation to verify or confirm the
accuracy of such determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder. For purposes of this Section 4.7, in
determining the number of outstanding Shares, a Holder may rely on the number of
outstanding Shares as reflected in (A) the Company’s most recent periodic or
annual report filed with the Securities and Exchange Commission, as the case may
be, (B) a more recent public announcement by the Company, or (C) a more recent
written notice by the Company or its transfer agent setting forth the number of
Shares outstanding. Upon the written or oral request of a Holder, the Company
shall within two Trading Days confirm orally and in writing to the Holder the
number of Shares then outstanding. In any case, the number of outstanding Shares
shall be determined after giving effect to the conversion or exercise of
securities of the Company, including these Warrants, by the Holder or its
affiliates since the date as of which such number of outstanding Shares was
reported.
 
4.8 
Adjustment of Exercise Price

The Exercise Price and the number of Shares purchasable hereunder (or any shares
of stock or other securities or property receivable or issuable upon exercise of
this Warrant) are subject to adjustment from time to time as follows:

 
- 8-

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(a)
Reclassification of Shares. If the Company at any time shall, by
reclassification or exchange of securities or otherwise, change all of the
outstanding Shares into the same or a different number of securities of any
other class or classes, this Warrant Certificate shall thereafter represent the
right to acquire such number and kind of securities as would have been issuable
hereunder had the Holder exercised its rights with respect to all of the Shares
then represented by this Warrant Certificate immediately prior to such
combination, reclassification, exchange, subdivision or other change.

 
 
(b)
Subdivision, Split, Reverse Split or Combination of Shares. If the Company at
any time shall subdivide or split its Shares into a larger number of outstanding
Shares, the Exercise Price shall be proportionately decreased and the number of
Shares issuable upon exercise of these Warrants (or any shares of stock or other
securities at the time issuable upon exercise of these Warrants) shall be
proportionally increased to reflect any such subdivision or stock split. If the
Company at any time shall reverse split or combine its Shares into a smaller
number of outstanding Shares, the Exercise Price of these Warrants shall be
proportionally increased and the number of Shares issuable upon exercise of
these Warrants (or any shares of stock or other securities at the time issuable
upon exercise of these Warrants) shall be proportionally decreased to reflect
any such reverse stock split or combination.

 
 
(c)
Stock Dividends or Other Non-Cash Distributions. If the Company at any time
shall make, issue, fix a record date for or pay a dividend or other distribution
with respect to the Shares (or any shares of stock or other securities at the
time issuable upon exercise of the Warrants) payable in (i) securities of the
Company or (ii) assets (excluding cash dividends), then, in each such case, the
Holder on exercise of these Warrants at any time after the consummation,
effective date or record date of such dividend or other distribution, shall
receive, in addition to the Shares (or such other stock or securities) issuable
on such exercise prior to such date, and without the payment of additional
consideration therefor, the securities or such other assets of the Company to
which such Holder would have been entitled upon such date if such Holder had
exercised these Warrants on the date hereof and had thereafter, during the
period from the date hereof to and including the date of such exercise, retained
such shares and all such additional securities or other assets distributed with
respect to such shares as aforesaid during such period giving effect to all
adjustments called for by this Section 4.8.

 
- 9-

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(d)
Capital Reorganization, Merger or Consolidation. In case of any capital
reorganization of the capital stock of the Company (other than a combination,
stock split, reverse stock split, reclassification or subdivision of shares
otherwise provided for herein), or any merger or consolidation of the Company
with or into another corporation, or the sale of all or substantially all the
assets of the Company then, and in each such case, as a part of such
reorganization, merger, consolidation, sale or transfer, lawful provision shall
be made so that the Holder shall thereafter be entitled to receive upon exercise
of these Warrants until the Expiry Date and upon payment of the Exercise Price
(or use of net exercise if then permitted hereunder), the number of shares or
other securities or property of the successor corporation resulting from such
reorganization, merger, consolidation, sale or transfer that a holder of the
Shares deliverable upon exercise of these Warrants would have been entitled to
receive in such reorganization, consolidation, merger, sale or transfer if these
Warrants had been exercised immediately before such reorganization, merger,
consolidation, sale or transfer, all subject to further adjustment as provided
in this Section 4.8. The foregoing provisions of this Section 4.8(d) shall
similarly apply to successive reorganizations, consolidations, mergers, sales
and transfers and to the stock or securities of any other corporation that are
at the time receivable upon the exercise of these Warrants. If the per-Share
consideration payable to the Holder hereof for Shares in connection with any
such transaction is in a form other than cash or marketable securities, then the
value of such consideration shall be determined in good faith by the Company’s
Board of Directors. In addition to the adjustments set forth above, appropriate
adjustments (as determined in good faith by the Company’s Board of Directors)
shall be made in the application of the provisions of this Warrant Certificate
with respect to the rights and interests of the Holder after the transaction, to
the end that the provisions of this Warrant Certificate shall be applicable
after that event, as near as reasonably may be, in relation to any shares or
other property deliverable after that event upon exercise of these Warrants.

 
 
(e)
Certificate as to Adjustments. In each case of any adjustment in the Exercise
Price, or number or type of Shares or other securities or property issuable upon
exercise of these Warrants, the Chief Financial Officer or Controller of the
Company shall compute such adjustment in accordance with the terms of this
Warrant Certificate and prepare a certificate setting forth such adjustment and
showing in detail the facts upon which such adjustment is based, including a
statement of the adjusted Exercise Price and/or Shares, other securities or
property issuable upon exercise, as applicable. The Company shall promptly send
a copy of each such certificate to the Holder.

 
4.9 
Determination of Adjustments

 
If any questions will at any time arise with respect to the Exercise Price or
any adjustment provided for in Section 4.8, such questions will be conclusively
determined by the Company’s Auditors, or, if they decline to so act any other
firm of certified public accountants in the United States of America that the
Company may designate and who will have access to all appropriate records and
such determination will be binding upon the Company and the Holders of the
Warrants.
 
4.10 
Charges, Taxes and Expenses

 
Issuance of certificates for Shares shall be made without charge to the Holder
for any issue or transfer tax or other incidental expense in respect of the
issuance of such certificate, all of which taxes and expenses shall be paid by
the Company, and such certificates shall be issued in the name of the Holder (or
in such name or names as may be directed by the Holder).

 
- 10-

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5.
REPRESENTATIONS AND WARRANTIES, OTHER AGREEMENTS OF THE COMPANY

 
5.1 
Due Authorization; Consents

The Company hereby represents and warrants to the Holder that all corporate
authorizations necessary for the execution and delivery of, and the performance
of all obligations of the Company under, this Warrant have been obtained. This
Warrant constitutes a valid and binding obligation of the Company enforceable in
accordance with its terms, subject, as to enforcement of remedies, to applicable
bankruptcy, insolvency, moratorium, reorganization and similar laws affecting
creditors’ rights generally and to general equitable principles.
 
5.2 
Organization

The Company hereby represents and warrants to Holder that the Company is a
corporation duly organized and validly existing under the laws of the State of
Nevada and has all requisite corporate power to own, lease and operate its
property and to carry on its business as now being conducted and as currently
proposed to be conducted.
 
5.3 
Reservation of Shares

The Company has duly authorized and reserved, and shall at all times have
authorized and reserved, a sufficient number of shares of its Common Stock to
provide for the exercise of the rights to purchase the Shares as provided in
this Warrant Certificate.
 
5.4 
Valid Issuance

All Shares issued upon the exercise of these Warrants shall be validly issued,
fully paid and nonassessable when issued consistent with the terms hereof, and
free from all taxes, liens and charges created by the Company in respect of the
issue thereof. The Company will take all such reasonable action as may be
necessary to assure that such Shares may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of any
Trading Market upon which the Shares may be listed.
Before taking any action which would result in an adjustment in the number of
Shares for which these Warrants are exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.

 
6.
HOLDER REPRESENTATIONS AND WARRANTIES

Holder hereby represents and warrants as follows:
 
6.1 
Securities Not Registered

The Holder understands that neither the Warrants nor the Shares have been
registered under the 1933 Act or the securities laws of any state of the United
States and are being issued in reliance on exemptions or exclusions from such
registration requirements.

 
- 11-

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6.2 
Restricted Shares/Legend

The Holder understands that the Company will treat the Shares issuable upon the
exercise of the Warrants under this Warrant Certificate as “restricted
securities” as that term is defined in Rule 144 promulgated under the 1933 Act,
and the Share certificates representing the Shares shall bear a legend in the
form substantially set forth on the second page of this Warrant Certificate.
 
7.
WAIVER OF CERTAIN RIGHTS

 
7.1 
Immunity of Shareholders, etc.

 
The Holder, as part of the consideration for the issue of the Warrants, waives
and will not have any right, cause of action or remedy now or hereafter existing
in any jurisdiction against any past, present or future incorporator,
shareholder, Director or Officer (as such) of the Company for the issue of
shares pursuant to any Warrant or on any covenant, agreement, representation or
warranty by the Company herein contained or in the Warrant.
 
8.
MODIFICATION OF TERMS, MERGER, SUCCESSORS

 
8.1 
Modification of Terms and Conditions for Certain Purposes

 
From time to time the Company may, subject to the provisions hereof, modify the
Terms and Conditions hereof, for the purpose of correction or rectification of
any ambiguities, defective provisions, errors or omissions herein of a
non-substantive nature.
 
8.2 
Warrants Transferable

These Warrants are transferable on the books of the Company at its principal
office by the Holder upon surrender of this Warrant Certificate properly
endorsed, and subject to compliance with this Section 7.2 and applicable federal
and state securities laws. The Company shall issue and deliver to the transferee
a new Warrant Certificate representing the Warrants so transferred (a “New
Warrant Certificate”). Upon any partial transfer, the Company will issue and
deliver to the Holder a New Warrant Certificate with respect to the portion of
the Warrants not so transferred.

 
As a condition to any transfer of these Warrants or any or all of the Shares
issuable upon exercise of these Warrants, other than a transfer registered under
the 1933 Act, the Company may request a legal opinion, in form and substance
reasonably satisfactory to the Company and its counsel, stating that such
transfer is exempt from the registration requirements of the 1933 Act.  Any
purported transfer of all or any portion of these Warrants in violation of the
provisions of this Warrant Certificate shall be null and void.
 
[SIGNATURE PAGE FOLLOWS]

 
- 12-

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DATED as of the date first above written in these Terms and Conditions.
 
GRYPHON GOLD CORPORATION
   
By:
   
John L. Key, Chief Executive
Officer

 
 
- 13-

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FORM OF SUBSCRIPTION
 
TO:
Gryphon Gold Corporation

 
Suite 711, 875 West Hastings Street

 
Vancouver, B.C., Canada  V6B 1N2

 
The undersigned Holder of the within Broker Warrants hereby subscribes for
_______ shares of common stock (the “Shares”) of Gryphon Gold Corporation (the
“Company) pursuant to the within Warrants at the Exercise Price on the terms
specified in the said Warrants.  This subscription is (check one):
 
¨
accompanied by a certified cheque or bank draft payable to or to the order of
the Company for the whole amount of the purchase price of the Shares; or

 
¨
being exercised pursuant to Section 4.1(b)(ii) of the Warrant Certificate.

 
In connection with this exercise, the undersigned hereby (check one):
 
_____1.
represents to the Company that (i) the holder was the original subscriber for
the Warrants from the Company, and (ii) the representations, warranties and
covenants set forth in the debenture and warrant purchase agreement pursuant to
which the holder purchased the Warrants from the Company (the “Purchase
Agreement”) are true and correct on the date of exercise in relation to the
exercise of the Warrants, including, without limitation, the representations and
warranties in the U.S. Accredited Investor Questionnaire attached to the
Purchase Agreement as Exhibit H; or

 
_____2.
confirms that the undersigned is tendering with this form of subscription a
written opinion of counsel reasonably satisfactory to the Company to the effect
that the Shares to be delivered upon exercise of these Warrants have been
registered under the United States Securities Act of 1933, as amended, (the
"1933 Act") and the securities laws of all applicable states of the United
States or are exempt from such registration requirements.

 
The undersigned hereby directs that the Shares be registered as follows:

 
NAME(S) IN FULL
 
ADDRESS(ES)
 
NUMBER OF
SHARES
         
  
 
  
 
  
         
  
 
  
 
  
   
TOTAL:
           
  

(Please print full name in which share certificates are to be issued, stating
whether Mr., Mrs. or Miss is applicable).

 
 

--------------------------------------------------------------------------------

 
 
DATED this ________  day of __________________ , 20__.
 
In the presence of:
 
  
 
  
Signature of Witness
 
Signature of Holder
Please print below your name and address in full.
   

 
Name (Mr./Mrs./Miss)
 

 
Address
 

 
INSTRUCTIONS FOR SUBSCRIPTION
 
The signature to the subscription must correspond in every particular with the
name written upon the face of the Warrant Certificate without alteration or
enlargement or any change whatever.  If there is more than one subscriber, all
must sign.
 
In the case of persons signing by agent or attorney or by personal
representative(s), the authority of such agent, attorney or representative(s) to
sign must be proven to the satisfaction of the Company.
 
If the Warrant Certificate and the form of subscription are being forwarded by
mail, registered mail must be employed.

 
A - 2

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TRANSFER FORM
 
Dated ___________ ___, _____

FOR VALUE RECEIVED, ___________________________________ hereby sells, assigns
and transfers unto_____________________________(the “Transferee”),

(please type or print in block letters)

   
(insert address)

the Warrants represented by these Broker Warrants and does hereby irrevocably
constitute and appoint _______________________ Attorney, to transfer the same on
the books of the Company, with full power of substitution in the premises.

The undersigned understands that, as a condition to any transfer of these
Warrants, the Company may request a legal opinion, in form and substance
reasonably satisfactory to the Company and its counsel, stating that such
transfer is exempt from the registration requirements of the 1933 Act.

SPACE FOR GUARANTEES OF
)
  SIGNATURES (BELOW)
)
 
 
)
Signature of Transferor
 
)
 
 
)
 
Guarantor’s Signature/Stamp
)
Name of Transferor
 
)
 

THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933, AS AMENDED (THE “1933 ACT”) OR THE APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES.  THESE SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
1933 ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND, IN EACH CASE, IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AND, IF REQUESTED BY THE
COMPANY, THE SELLER FURNISHES TO THE COMPANY AN OPINION OF COUNSEL OF RECOGNIZED
STANDING IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY TO SUCH
EFFECT.

 
A - 3

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CERTAIN REQUIREMENTS RELATING TO TRANSFERS – READ CAREFULLY
 
The signature(s) of the transferor(s) must correspond with the name(s) as
written upon the face of this certificate(s), in every particular, without
alteration or enlargement, or any change whatsoever.  The signature(s) on this
form must be guaranteed in accordance with the transfer agent’s then current
guidelines and requirements at the time of transfer.  Notarized or witnessed
signatures are not acceptable as guaranteed signatures.  As at the time of
closing, you may choose one of the following methods (although subject to change
in accordance with industry practice and standards):
 
 
·
Canada and the USA: A Medallion Signature Guarantee obtained from a member of an
acceptable Medallion Signature Guarantee Program (STAMP, SEMP, NYSE MSP).  Many
commercial banks, savings banks, credit unions, and all broker dealers
participate in a Medallion Signature Guarantee Program.  The Guarantor must
affix a stamp bearing the actual words “Medallion Guaranteed”, with the correct
prefix covering the face value of the certificate.

 
 
·
Canada:  A Signature Guarantee obtained from the Guarantor must affix a stamp
bearing the actual words “Signature Guaranteed”.  Signature Guarantees are not
accepted from Treasury Branches, Credit Unions or Caisse Populaires unless they
are members of a Medallion Signature Guarantee Program. For corporate holders,
corporate signing resolutions, including certificate of incumbency, are also
required to accompany the transfer, unless there is a “Signature & Authority to
Sign Guarantee” Stamp affixed to the transfer (as opposed to a “Signature
Guarantee” Stamp) obtained from an authorized officer of a major Canadian
Schedule 1 chartered bank.

 
 
·
Outside North America:  For holders located outside North America, present the
certificates(s) and/or document(s) that require a guarantee to a local financial
institution that has a corresponding Canadian or American affiliate which is a
member of an acceptable Medallion Signature Guarantee Program.  The
corresponding affiliate will arrange for the signature to be over-guaranteed.

 
 
A - 4

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SCHEDULE B
   

 
1.
Based on the provisions of the Tax Act and the Regulations thereunder in force
as of the date hereof and the Proposed Amendments, provided the common shares in
the capital of the Company are listed on a designated stock exchange (which
currently includes the Toronto Stock Exchange), the Debentures, the Warrant
Shares and Broker Warrant Shares are qualified investments under the Tax Act and
the Regulations thereunder for trusts governed by registered retirement savings
plans, registered retirement income funds, deferred profit sharing plans,
registered education savings plans, registered disability savings plans and tax
free savings accounts, except that in the case of a deferred profit sharing
plan: i) the Company deals at arm’s length with each person who is an annuitant,
a beneficiary, an employer or a subscriber under such deferred profit sharing
plan and ii) the Company or a corporation with which the Company does not deal
at arm’s length is not an employer.

 
2.
The offering, sale and issuance of the Securities through the Agents are exempt
from the prospectus requirements of the Securities Laws, and the only filing,
proceeding, approval, permit, consent or authorization required to be made,
taken or obtained under the Securities Laws is the filing with the applicable
provincial securities regulatory authority within the prescribed time periods, a
report in Form 45-106F1, as prescribed by NI 45-106, prepared and executed in
accordance with applicable Securities Laws, together with the requisite filing
fees, assuming distribution by registrants who comply with the relevant
provisions of such applicable Securities Laws.

 
3.
The issuance and delivery of the:

 
 
(a)
Warrant Shares upon the exercise of the Warrants in accordance with the terms of
the Warrant Certificates; or

 
 
(b)
Broker Warrant Shares upon the exercise of the Broker Warrants in accordance
with the terms of the Broker Warrant Certificates,

 
are exempt from the prospectus requirements of the Securities Laws and no
prospectus is required, nor are any other documents required to be filed, no
proceeding is required to be taken and no approval, permit, consent, order or
authorization of any regulatory authority is required to be obtained under the
Securities Laws to permit such exercises and issuances.
 
4.
The first trade of the Securities, Warrant Shares, Broker Warrants and Broker
Warrant Shares will be a distribution subject to the prospectus requirements of
the Securities Laws unless:

 
 
(a)
at the time of the trade, the Company is and has been a “reporting issuer”, as
defined in the Securities Laws, in a province or territory of Canada for the
four months immediately preceding the trade;

 
 
 

--------------------------------------------------------------------------------

 
 
 
(b)
at the time of the trade, at least four months have elapsed from the
“distribution date” (as such term is defined in National Instrument 45-102 -
Resale of Securities (“NI 45-102”));

 
 
(c)
the certificates representing the Debentures, Warrants and Broker Warrants (and
the Warrant Shares and Broker Warrant Shares, if issued within four months of
the Closing Date) that are the subject of the trade carry a legend in the form
as set out in Section 2.5(2)3(i) of NI 45-102, or if the certificate(s)
representing the Debentures, Warrants and Broker Warrants (and the Warrant
Shares and Broker Warrant Shares, if issued within four months of the Closing
Date) is entered into a direct registration or other electronic book-entry
system or if the Purchaser did not directly receive a certificate representing
such securities, the Purchaser received written notice containing the legend
restriction notation set out in Section 2.5(2)3(i) of NI 45-102;

 
 
(d)
the trade is not a “control distribution” as defined in NI 45-102;

 
 
(e)
no unusual effort is made to prepare the market or create a demand for the
Debentures that are the subject of the trade;

 
 
(f)
no extraordinary commission or consideration is paid to a person or company in
respect of the trade; and

 
 
(g)
if the Purchaser is an insider or officer of the Company at the time of the
trade, the Purchaser has no reasonable grounds to believe that the Company is in
default of securities legislation (as defined in National Instrument 14-101).

 
5.
The Company is:

 
 
(a)
a “reporting issuer” under the Securities Act (Alberta) and is not in default of
filing requirements concerning continuous disclosure obligations required by
that Act or the rules made under that Act;

 
 
(b)
a “reporting issuer” under The Securities Act, 1988 (Saskatchewan) and is not
included on the list of defaulting issuers maintained by the Saskatchewan
Financial Services Commission; and

 
 
(c)
a “reporting issuer” under the Securities Act (Ontario) and is not indicated on
the Ontario Reporting Issuer List as having failed to comply with a requirement
of Ontario Securities Laws as of the date of the list.

 
6.
The Toronto Stock Exchange has confirmed that it has pre-cleared the form of the
Warrant Certificates.

 
7.
The Agency Agreement constitutes a valid and legally binding obligation of the
Company enforceable against the Company in accordance with its terms.

 
 
 

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8.
The execution and delivery of the Agency Agreement and the fulfillment of the
terms thereof by the Company and the performance of and compliance with the
terms of the Agency Agreement by the Company does not and will not result in a
breach of, or constitute a default under, and does not and will not create a
state of facts which, after notice or lapse of time or both, will result in a
breach of or constitute a default under any applicable laws of the Province of
British Columbia or the federal laws of Canada applicable therein.

 
 
 

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SCHEDULE C
  

 
1.
The Debentures are in the form of the Debenture Certificate and the Warrants are
in the form of the Warrant Certificates and are consistent with the form of
Debenture and form of Warrant, respectively, approved in the Board Resolutions
and described in the Transaction Documents.

 
2.
The Debentures have been duly executed and issued by the Corporation and,
assuming they have been duly certified and authenticated by the Trustee and
validly issued, constitute valid and legally binding obligations of the
Corporation, enforceable against it in accordance with their terms.  All
conditions precedent provided for in the Trust Indenture relating to the
authorization, execution, issuance, certification and delivery of the Debentures
and all legal requirements in connection with the issuance of the Debentures
have been complied with or satisfied by the Corporation.

 
3.
Each of the Transaction Documents has been duly authorized, executed and
delivered by the Corporation, and each constitutes a legal, valid and binding
obligation of the Corporation, enforceable against the Corporation in accordance
with its terms.

 
4.
The execution and delivery of the Transaction Documents and the fulfillment of
the terms thereof by the Corporation and the performance of and compliance with
the terms of the Transaction Documents by the Corporation do not and will not
result in a breach of, or constitute a default under, and do not and will not
create a state of facts which, after notice or lapse of time or both, will
result in a breach of or constitute a default under, (i) any statute of the
United States or the State of New York or any rule or regulation of any
governmental authority or regulatory body of the United States or the State of
New York, (ii) to our knowledge, any resolutions of the directors (or a
committee thereof) or shareholders of the Corporation or its subsidiary,
Borealis Mining Company, a Nevada corporation (the "Subsidiary"), (iii) to our
knowledge, any mortgage, note, indenture, contract, agreement (written or oral),
instrument, lease or other document to which the Corporation or its Subsidiary
is a party or by which it is bound, or (iv) to our knowledge, any judgment,
decree or order of any court, governmental agency or body or regulatory
authority of the State of New York, which breach or default might reasonably be
expected to materially adversely affect the business, operations, capital or
condition (financial or otherwise) of the Corporation and its Subsidiary (taken
as a whole).

 
5.
The rights, privileges, restrictions and conditions attached to the Securities
conform in all material respects with the description thereof contained in the
Agency Agreement and the Purchase Agreements.

 
6.
The Security and Pledge Agreement creates a valid security interest in the
Collateral to the extent of the respective rights of the Corporation in such
Collateral.  Under Article 9 of the UCC – New York and Article 9 of the
UCC-Nevada, the State of Nevada is the proper jurisdiction in which to file a
financing statement to perfect the Trustee's security interest in the
Collateral.

 
 
 

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7.
The Financing Statement is sufficient in form for filing with the Nevada
Secretary of State and, upon such filing, will perfect the Trustee's security
interest in the Collateral to the extent a security interest in the Collateral
may be perfected under the UCC-Nevada by filing financing statements with the
Nevada Secretary of State.

 
8.
Pursuant to Sections 9-301(2) and 9-305(a)(1) of the UCC-New York, the local law
of the jurisdiction where certificated securities are actually located governs
perfection of a possessory security interest in such securities.  Assuming the
Trustee takes delivery and retains possession (as those terms are used in
Section 8-301 and Section 9-313 of the UCC-New York) of certificates
representing the securities pledged to the Trustee pursuant to the Security and
Pledge Agreement (the "Pledged Securities") and further assuming the Pledged
Securities are each duly indorsed to the Trustee or in blank by an effective
endorsement or are accompanied by undated stock powers with respect thereto duly
indorsed to the Trustee or in blank by an effective endorsement, the Trustee’s
security interest in the Corporation’s rights in the Pledged Securities will be
perfected by "control" (within the meaning of the UCC-New York).

 
9.
No consent, approval, authorization of, or registration or filing with, any
State of New York or federal governmental authority is required to be obtained
or made by the Corporation to make valid and legally binding the execution,
delivery and performance by the Corporation of its agreements under the
Transaction Documents to which the Corporation is a party, except such as have
been obtained or made, which includes the filing of the Financing Statements
filed in connection with the Security and Pledge Agreement.

 
10.
The issuance and sale of the Offered Securities in the Offering by the
Corporation and the offer of such Offered Securities by the Agents in the manner
contemplated by the Agency Agreement and the Transaction Documents does not
require registration under the U.S. Securities Act.

 
 
 

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SCHEDULE D
  

1.
The Corporation has been duly organized and is validly existing as a corporation
in good standing under the laws of the State of Nevada.

2.
Borealis Mining Company, a Nevada corporation, has been duly organized and is
validly existing as a corporation in good standing under the laws of the State
of Nevada.

3.
The Corporation has all requisite corporate power and capacity to conduct its
business as it is now carried on and to enter into and to perform its
obligations under the Agency Agreement, the Purchase Agreements and the
certificates representing the Warrants and the Broker Warrants, and to create
and issue the Offered Securities, the Warrant Shares and the Broker Shares.  No
approval by the security holders of the Corporation is required pursuant to the
Articles of Incorporation of the Corporation in connection with the issuance and
sale of the Offered Securities, the Warrant Shares and the Broker Shares or with
the consummation by the Corporation of the transactions contemplated by the
Transaction Documents.

4.
The Debentures, once duly executed and issued by the Corporation and certified
by the Trustee under the Indenture, will be validly issued.

5.
Each of the Transaction Documents has been duly authorized by the Corporation.

6.
The execution and delivery of the Transaction Documents, the fulfillment of the
terms thereof and the performance and compliance with the terms of them by the
Corporation, do not and will not result in a breach of, or constitute a default
under, and do not and will not create a state of facts which, after notice or
lapse of time or both, will result in a breach of or constitute a default under,
the Articles of Incorporation of the Corporation.

7.
The authorized capital of the Corporation consists of 250,000,000 Common Shares
and 15,000,000 of Preferred Stock.  Based solely on the Officer's Certificate
attached hereto, _____________ Common Shares and no shares of Preferred Stock
are issued and outstanding.

8.
The Common Shares to be issued upon exercise of the Warrants and the Broker
Warrants are free of preemptive rights, resale rights, rights of first refusal
and restrictions upon voting and transfer, in each event created by Nevada
corporate statutes.

9.
The Warrants and Broker Warrants have been duly created and validly
authorized.  The Warrant Shares and Broker Shares have been duly and validly
created, reserved, allotted and authorized to be issued as fully paid and
nonassessable upon receipt by the Corporation of full payment therefor.

 
 
 

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SCHEDULE E
  

MATERIAL CONTRACTS

 
1.
Assignment of Borealis Mining Lease, dated January 10, 2005, between Golden
Phoenix Mineral Company and Borealis Mining Company

 
 
2.
Agreement and Consent to Assignment of Borealis Mining Lease, entered into as of
January 26, 2005, between Richard J. Cavell, Hardrock Mining Company, John W.
Whitney, Golden Phoenix Minerals, Inc., Borealis Mining Company and Gryphon Gold
Corporation

 
 
3.
Escrow Agreement, dated January 10, 2005, between Borealis Mining Company,
Gryphon Gold Company and Lawyers Title Agency of Arizona

 
 
4.
Purchase Agreement dated January 10, 2005, as amended, Seller: Golden Phoenix
Minerals, Inc., Buyer: Borealis Mining Company and Guarantor: Gryphon Gold
Corporation

 
 
5.
Agreement between Golden Phoenix Minerals, Inc. and Borealis Mining Company
(Borealis Property, Mineral County, Nevada), dated July 21, 2003

 
 
6.
Membership Interest Purchase Agreement for Nevada Eagle Resources LLC Properties

 
 
7.
Employment Agreement between the Registrant and John L. Key, dated July 21, 2008

 
 
8.
Financial Services Agreement between the Registrant and Tony Ker, dated
September 1, 2008

 
 
9.
Transition Agreement between the Registrant and Tony Ker, dated July 21, 2008

 
 
10.
Option to Restructure Debt Agreement between the Registrant and Nevada Eagle
Resources, dated August 5, 2008

 
 
11.
Financial and Advisory Services Agreement between the Registrant and Matter &
Associates, dated October 1, 2008

 
 
12.
Option to Amend the Mining Lease on the Borealis Property, dated effective
August 22, 2008

 
 
13.
Termination of Financial Services Agreement between the Registrant and Tony Ker,
dated effective September 28, 2008

 
 
14.
Consulting Agreement between the Registrant and Steven Craig, dated November 1,
2008

 
 
15.
Consulting Agreement between the Registrant and Michael Longinotti, dated
November 12, 2008

 
 
16.
Interim Consulting Agreement between the Registrant and Mr. R. William Wilson,
dated January 6, 2010

 
 
17.
Amendment No. 1 to the Option Agreement between the Registrant, Gerald W. and
Fabiola Baughman, and Nevada Eagle Resources LLC, dated February 5, 2010

 
 

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18.
Option Consideration Agreement between the Registrant and Gerald W. and Fabiola
Baughman, dated February 5, 2010

 
 
19.
Amendment No. 2 to the Option Agreement between the Registrant, Gerald W. and
Fabiola Baughman, and Nevada Eagle Resources LLC, dated February 12, 2010

 
 
20.
Binding Letter of Intent (between the Registrant and Sage Gold Inc., dated
February 23, 2010

 
 
21.
Option Agreement between the Registrant, Borealis Mining Company, and Sage Gold
Inc. dated March 5, 2010

 
 
22.
Amendment No. 1 to Option Agreement and Amendment No. 1 to Subscription
Agreement between the Registrant, Borealis Mining Company, and Sage Gold Inc.
dated March 26, 2010

 
 
23.
Amendment No. 1 to Option to Amend Mining Lease dated August 7, 2009

 
 
24.
Amendment No. 2 to Option to Amend Mining Lease dated February 12, 2010

 
 
25.
Amendment No. 3 to Option to Amend Mining Lease dated August 17, 2010

 
 
26.
Amendment No. 4 to Option to Amend Mining Lease dated February 22, 2010

 
 
27.
Amendment No. 2 to Option Agreement between the Registrant, Borealis Mining
Company and Sage Gold, dated April 19, 2010

 
 
28.
Membership Interest Purchase Agreement between the Registrant and Fronteer
Development (USA) Inc. dated April 23, 2010

 
 
29.
Amendment No. 3 to Option Agreement and Amendment No. 2 to Subscription
Agreement between the Registrant, Borealis Mining Company and Sage Gold, dated
April 19, 2010

 
 
30.
Amendment No. 4 to Option Agreement between the Registrant, Borealis Mining
Company and Sage Gold, dated June 15, 2010

 
 
31.
Amendment to Mining Lease dated effective May 20, 2011

 
 

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