NORTHUMBERLAND RESOURCES INC.

INVESTORS’ RIGHTS AGREEMENT

 

This Investors’ Rights Agreement (this “Agreement”) is made as of April 27,
2012, by and among Northumberland Resources Inc., a Nevada corporation (the
“Company”), and ThorFinn Partners (the “Investor”. Unless otherwise defined
herein, capitalized terms used in this Agreement have the meanings ascribed to
them in Section 1.

 

Recitals

 

WHEREAS: The Investors are parties to the Common Stock Purchase Agreement of
even date herewith, among the Company and the Investor (the “Purchase
Agreement”), and it is a condition to the closing of the sale of the Common
Stock to the Investor that the Investor and the Company execute and deliver this
Agreement.

 

NOW, THEREFORE: In consideration of the mutual promises and covenants set forth
herein, and other consideration, the receipt and adequacy of which is hereby
acknowledged, the parties hereto agree as follows:

 

Section 1

Definitions

 

1.1        Certain Definitions. As used in this Agreement, the following terms
shall have the meanings set forth below:

 

(a)        “Commission” shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.

 

(b)        “Common Stock” means the Common Stock of the Company.

 

(c)        "Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended, or any similar successor federal statute and the rules and regulations
thereunder, all as the same shall be in effect from time to time.

 

(d)         “Existing Investors” shall mean existing stockholders of the
Company.

 

(e)        “Holder” shall mean any Investor who holds Registrable Securities and
any holder of Registrable Securities to whom the registration rights conferred
by this Agreement have been duly and validly transferred in accordance with
Section 2.12 of this Agreement.

 

(f)        “Indemnified Party” shall have the meaning set forth in Section
2.6(c) hereto.

 

(g)        “Indemnifying Party” shall have the meaning set forth in Section
2.6(c) hereto.

 

(h)        “Initial Closing” shall mean the date of the initial sale of shares
of the Company’s Common Stock pursuant to the Purchase Agreement.

 

(i)         “Initiating Holders” shall mean any Holder or Holders who have
rights to Registrable Securities.

 

 

 

 

(j)         “New Securities” shall have the meaning set forth in Section 4.1(a)
hereto.

 

(k)        “Other Selling Stockholders” shall mean persons other than the
Investor who, by virtue of agreements with the Company, are entitled to include
their shares in certain registrations hereunder.

 

(l)        “Other Shares” shall mean shares of Common Stock held by other
investors in the Company.

 

(m)        “Purchase Agreement” shall have the meaning set forth in the Recitals
hereto.

 

(n)        “Registrable Securities” shall mean (i) the Shares (ii) shares of the
Company held by investors entitled to registration (iii) any Common Stock issued
as a dividend or other distribution with respect to or in exchange for or in
replacement of the shares referenced in (i) above; provided, however, that
Registrable Securities shall not include any shares of Common Stock described in
clause (i) or (ii) above which have previously been registered or which have
been sold to the public either pursuant to a registration statement or Rule 144,
or which have been sold in a private transaction in which the transferor’s
rights under this Agreement are not validly assigned in accordance with this
Agreement.

 

(o)        The terms “register,” “registered” and “registration” shall refer to
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.

 

(p)        “Registration Expenses” shall mean all expenses incurred in effecting
any registration pursuant to this Agreement, including, without limitation, all
registration, qualification, and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses,
and expenses of any regular or special audits incident to or required by any
such registration, but shall not include Selling Expenses, fees and
disbursements of counsel for the Holders and the compensation of regular
employees of the Company, which shall be paid in any event by the Company.

 

(q)        “Restricted Securities” shall mean any Registrable Securities
required to bear the first legend set forth in Section 2.8(c) hereof.

 

(r)        “Rule 144” shall mean Rule 144 as promulgated by the Commission under
the Securities Act, as such Rule may be amended from time to time, or any
similar successor rule that may be promulgated by the Commission.

 

(s)        “Rule 145” shall mean Rule 145 as promulgated by the Commission under
the Securities Act, as such Rule may be amended from time to time, or any
similar successor rule that may be promulgated by the Commission

 

(t)        “Rule 415” shall mean Rule 415 as promulgated by the Commission under
the Securities Act, as such Rule may be amended from time to time, or any
similar successor rule that may be promulgated by the Commission.

 

(u)        “Securities Act” shall mean the Securities Act of 1933, as amended,
or any similar successor federal statute and the rules and regulations
thereunder, all as the same shall be in effect from time to time.

 

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(v)        “Selling Expenses” shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the sale of Registrable
Securities and fees and disbursements of counsel for any Holder.

 

(w)         “Shares” shall mean the Company’s Common Stock sold to the Investor
pursuant to the Purchase Agreement.

 

(x)        “Significant Holders” shall have the meaning set forth in Section 4.1
hereof.

 

(y)        “Withdrawn Registration” shall mean a forfeited demand registration
under Section 2.1 in accordance with the terms and conditions of Section 2.4.

 

Section 2

Registration Rights

 

2.1        Requested Registration.

 

(a)        Request for Registration. Subject to the conditions set forth in this
Section 2.1, if the Company shall receive from the Investor or Other Selling
Stockholders with a written request signed by such that the Company effect any
registration with respect to all or a part of the Registrable Securities (such
request shall state the number of shares of Registrable Securities to be
disposed of), the Company will:

 

(i)        promptly give written notice of the proposed registration to all
other Holders; and

 

(ii)        as soon as practicable, file and use its commercially reasonable
efforts to effect such registration (including, without limitation, filing
post-effective amendments, appropriate qualifications under applicable blue sky
or other state securities laws, and appropriate compliance with the Securities
Act) and to permit or facilitate the sale and distribution of all or such
portion of such Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any Holder or
Holders joining in such request as are specified in a written request received
by the Company within ninety (90) days after such written notice from the
Company is mailed or delivered.

 

(b)        Limitations on Requested Registration. The Company shall not be
obligated to effect, or to take any action to effect, any such registration
pursuant to this Section 2.1:

 

(i)        After four years following the date hereof;

 

(ii)        In any particular jurisdiction in which the Company would be
required to execute a general consent to service of process in effecting such
registration, qualification, or compliance, unless the Company is already
subject to service in such jurisdiction and except as may be required by the
Securities Act;

 

(iii)        After the Company has initiated two such registrations pursuant to
this Section 2.1 (counting for these purposes only (x) registrations which have
been declared or ordered effective and pursuant to which securities have been
sold, and (y) Withdrawn Registrations);

 

(iv)        During the period starting with the date sixty (60) days prior to
the Company’s good faith estimate of the date of filing of, and ending on a date
one hundred eighty (180) days after the effective date of, a Company-initiated
registration; provided that the Company is actively employing in good faith
commercially reasonable efforts to cause such registration statement to become
effective;

 

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(v)        If the Investor propose to dispose of shares of Registrable
Securities that may be registered on Form S-3 pursuant to a request made under
Section 2.3 hereof.

 

(c)        Deferral. If (i) in the good faith judgment of the Board of Directors
of the Company, the filing of a registration statement covering the Registrable
Securities would be materially detrimental to the Company and the Board of
Directors of the Company concludes, as a result, that it is in the best
interests of the Company to defer the filing of such registration statement at
such time, and (ii) the Company shall furnish to such Holders a certificate
signed by the President of the Company stating that in the good faith judgment
of the Board of Directors of the Company, it would be materially detrimental to
the Company for such registration statement to be filed in the near future and
that it is, therefore, in the best interests of the Company to defer the filing
of such registration statement, then (in addition to the limitations set forth
in Section 2.1(b)(v) above) the Company shall have the right to defer such
filing for a period of not more than one hundred eighty (180) days after receipt
of the request of the Initiating Holders, and, provided further, that the
Company shall not defer its obligation in this manner more than twice in any
twelve-month period.

 

(d)        Other Shares. The registration statement filed pursuant to the
request of the Investor may, subject to the provisions of Section 2.1(e),
include Other Shares, and may include securities of the Company being sold for
the account of the Company.

 

(e)        Underwriting. If the Initiating Holders intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
this Section 2.1 and the Company shall include such information in the written
notice given pursuant to Section 2.1(a)(i). The right of the Investor to include
all or any portion of its Registrable Securities in a registration pursuant to
this Section 2.1 shall be conditioned upon the Investor’s participation in an
underwriting and the inclusion of the Investor’s Registrable Securities to the
extent provided herein. If the Company shall request inclusion in any
registration pursuant to Section 2.1 of securities being sold for its own
account, or if other persons shall request inclusion in any registration
pursuant to Section 2.1, the Investor shall offer to include such securities in
the underwriting and such offer shall be conditioned upon the participation of
the Company or such other persons in such underwriting and the inclusion of the
Company’s and such person’s other securities of the Company and their acceptance
of the further applicable provisions of this Section 2 (including Section 2.10).
The Company shall (together with all stockholders proposing to distribute their
securities through such underwriting) enter into an underwriting agreement in
customary form with the representative of the underwriter or underwriters
selected for such underwriting.

 

If a person who has requested inclusion in such registration as provided above
does not agree to the terms of any such underwriting, such person shall be
excluded therefrom by written notice from the Company, the underwriter or the
Investor. The securities so excluded shall also be withdrawn from registration.
If shares are so withdrawn from the registration and if the number of shares to
be included in such registration was previously reduced as a result of marketing
factors pursuant to this Section 2.1(e), then the Company shall then offer to
all Holders who have retained rights to include securities in the registration
the right to include additional Registrable Securities in the registration in an
aggregate amount equal to the number of shares so withdrawn, with such shares to
be allocated among such requesting additional inclusion, as set forth above.

 

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2.2        Company Registration.

 

(a)        Company Registration. If the Company shall determine to register any
of its securities either for its own account or the account of a security holder
or holders, other than a registration pursuant to Section 2.1 or 2.3, a
registration relating solely to employee benefit plans, a registration relating
to the offer and sale of debt securities, a registration relating to a corporate
reorganization or other Rule 145 transaction, or a registration on any
registration form that does not permit secondary sales, the Company will:

 

(i)        promptly give written notice of the proposed registration to all
Holders; and

 

(ii)        use its commercially reasonable efforts to include in such
registration (and any related qualification under blue sky laws or other
compliance), except as set forth in Section 2.2(b) below, and in any
underwriting involved therein, all of such Registrable Securities as are
specified in a written request or requests made by any Holder or Holders
received by the Company within ten (10) days after such written notice from the
Company is mailed or delivered. Such written request may specify all or a part
of a Holder’s Registrable Securities.

 

(b)        Underwriting. If the registration of which the Company gives notice
is for a registered public offering involving an underwriting, the Company shall
so advise the Holders as a part of the written notice given pursuant to Section
2.2(a)(i). In such event, the right of any Holder to registration pursuant to
this Section 2.2 shall be conditioned upon such Holder’s participation in such
underwriting and the inclusion of such Holder’s Registrable Securities in the
underwriting to the extent provided herein. All Holders proposing to distribute
their securities through such underwriting shall (together with the Company and
the other holders of securities of the Company with registration rights to
participate therein distributing their securities through such underwriting)
enter into an underwriting agreement in customary form with the representative
of the underwriter or underwriters selected by the Company.

 

Notwithstanding any other provision of this Section 2.2, if the underwriters
advise the Company in writing that marketing factors require a limitation on the
number of shares to be underwritten, the underwriters may (subject to the
limitations set forth below) exclude all Registrable Securities from, or limit
the number of Registrable Securities to be included in, the registration and
underwriting. The Company shall so advise all holders of securities requesting
registration, and the number of shares of securities that are entitled to be
included in the registration and underwriting shall be allocated, as follows:
(i) first, to the Company for securities being sold for its own account, (ii)
second, to the Holders requesting to include Registrable Securities in such
registration statement based on the pro rata percentage of Registrable
Securities held by such Holders, assuming conversion and (iii) third, to the
stockholders requesting to include Other Shares in such registration statement
based on the pro rata percentage of Other Shares held by such Other Selling
Stockholders, assuming conversion.

 

If a person who has requested inclusion in such registration as provided above
does not agree to the terms of any such underwriting, such person shall also be
excluded therefrom by written notice from the Company or the underwriter. The
Registrable Securities or other securities so excluded shall also be withdrawn
from such registration. Any Registrable Securities or other securities excluded
or withdrawn from such underwriting shall be withdrawn from such registration.
If shares are so withdrawn from the registration and if the number of shares of
Registrable Securities to be included in such registration was previously
reduced as a result of marketing factors pursuant to Section 2.2(b), the Company
shall then offer to all persons who have retained the right to include
securities in the registration the right to include additional securities in the
registration in an aggregate amount equal to the number of shares so withdrawn,
with such shares to be allocated among the persons requesting additional
inclusion, in the manner set forth above.

 

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(c)        Right to Terminate Registration. The Company shall have the right to
terminate or withdraw any registration initiated by it under this Section 2.2
prior to the effectiveness of such registration whether or not any Holder has
elected to include securities in such registration.

 

2.3        Registration on Form S-3.

 

(a)        Request for Form S-3 Registration. The Company shall use its
commercially reasonable efforts to qualify for registration on Form S-3 or any
comparable or successor form or forms. After the Company has qualified for the
use of Form S-3, in addition to the rights contained in the foregoing provisions
of this Section 2 and subject to the conditions set forth in this Section 2.3,
if the Company shall receive from a Holder a written request that the Company
effect any registration on Form S-3 or any similar short form registration
statement with respect to all or part of the Registrable Securities (such
request shall state the number of shares of Registrable Securities to be
disposed of and the intended methods of disposition of such shares by such
Holder or Holders), the Company will take all such action with respect to such
Registrable Securities as required by Section 2.1(a)(i) and (ii).

 

(b)        Limitations on Form S-3 Registration. The Company shall not be
obligated to effect, or take any action to effect, any such registration
pursuant to this Section 2.3:

 

(i)        In the circumstances described in either Sections 2.1(b)(i),
2.1(b)(iii) or 2.1(b)(v);

 

(ii)        If the Holders, together with the holders of any other securities of
the Company entitled to inclusion in such registration, propose to sell
Registrable Securities and such other securities (if any) on Form S-3 at an
aggregate price to the public of less than $l,000,000; or

 

(iii)        If, in a given twelve-month period, the Company has effected two
(2) such registrations in such period.

 

(c)        Deferral. The provisions of Section 2.1(c) shall apply to any
registration pursuant to this Section 2.3.

 

(d)        Underwriting. If the Holders of Registrable Securities requesting
registration under this Section 2.3 intend to distribute the Registrable
Securities covered by their request by means of an underwriting, the provisions
of Sections 2.1(e) shall apply to such registration. Notwithstanding anything
contained herein to the contrary, registrations effected pursuant to this
Section 2.3 shall not be counted as requests for registration or registrations
effected pursuant to Section 2.1.

 

2.4        Expenses of Registration. All Registration Expenses incurred in
connection with registrations pursuant to Sections 2.1, 2.2 and 2.3 hereof shall
be borne by the Company; provided, however, that the Company shall not be
required to pay for any expenses of any registration proceeding begun pursuant
to Sections 2.1 and 2.3 if the registration request is subsequently withdrawn at
the request of the Holders of a majority of the Registrable Securities to be
registered or because a sufficient number of Holders shall have withdrawn so
that the minimum offering conditions set forth in Sections 2.1 and 2.3 are no
longer satisfied (in which case all participating Holders shall bear such
expenses pro rata among each other based on the number of Registrable Securities
requested to be so registered), unless the Holders of a majority of the
Registrable Securities agree to forfeit their right to a demand registration
pursuant to Section 2.1;provided, however, in the event that a withdrawal by the
Holders is based upon material adverse information relating to the Company that
is different from the information known or available (upon request from the
Company or otherwise) to the Holders requesting registration at the time of
their request for registration under Section 2.1, such registration shall not be
treated as a counted registration for purposes of Section 2.1 hereof, even
though the Holders do not bear the Registration Expenses for such registration.
All Selling Expenses relating to securities registered on behalf of the Holders
shall be borne by the holders of securities included in such registration pro
rata among each other on the basis of the number of Registrable Securities so
registered.

 

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2.5        Registration Procedures. In the case of each registration effected by
the Company pursuant to Section 2, the Company will keep each Holder advised in
writing as to the initiation of each registration and as to the completion
thereof. At its expense, the Company will use its commercially reasonable
efforts to:

 

(a)        Keep such registration effective for a period of ending on the
earlier of the date which is sixty (60) days from the effective date of the
registration statement or such time as the Holder or Holders have completed the
distribution described in the registration statement relating thereto;

 

(b)        Prepare and file with the Commission such amendments and supplements
to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement for the period set forth in subsection (a) above;

 

(c)        Furnish such number of prospectuses, including any preliminary
prospectuses, and other documents incident thereto, including any amendment of
or supplement to the prospectus, as a Holder from time to time may reasonably
request;

 

(d)        Use its reasonable best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdiction as shall be reasonably requested by the
Holders; provided, that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions;

 

(e)        Notify each seller of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or incomplete in light of the circumstances
then existing, and following such notification promptly prepare and furnish to
such seller a reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such shares, such prospectus shall not include an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or incomplete
in light of the circumstances then existing;

 

(f)         If (i) a registration made pursuant to a shelf registration
statement is required to be kept effective in accordance with this Agreement
after the third anniversary of the initial effective date of the shelf
registration statement and (ii) the registration rights of the applicable
Holders have not terminated, file a new registration statement with respect to
any unsold Registrable Securities subject to the original request for
registration prior to the end of the three year period after the initial
effective date of the shelf registration statement, and keep such registration
statement effective in accordance with the requirements otherwise applicable
under this Agreement;

 

(g)         Use its commercially reasonable efforts to furnish, on the date that
such Registrable Securities are delivered to the underwriters for sale, if such
securities are being sold through underwriters, (i) an opinion, dated as of such
date, of the counsel representing the Company for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering, addressed to the underwriters, if any, and
reasonably satisfactory to a majority in interest of the Holders requesting
registration of Registrable Securities and (ii) a “comfort” letter dated as of
such date, from the independent certified public accountants of the Company, in
form and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering, addressed to the
underwriters;

 

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(h)        Provide a transfer agent and registrar for all Registrable Securities
registered pursuant to such registration statement and a CUSIP number for all
such Registrable Securities, in each case not later than the effective date of
such registration;

 

(i)        Otherwise use its commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least twelve months, but not more than eighteen
months, beginning with the first month after the effective date of the
Registration Statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act;

 

(j)        Cause all such Registrable Securities registered pursuant hereunder
to be listed on each securities exchange on which similar securities issued by
the Company are then listed; and

 

(k)        In connection with any underwritten offering pursuant to a
registration statement filed pursuant to Section 2.1 hereof, enter into an
underwriting agreement in form reasonably necessary to effect the offer and sale
of Common Stock, provided such underwriting agreement contains reasonable and
customary provisions, and provided further, that each Holder participating in
such underwriting shall also enter into and perform its obligations under such
an agreement.

 

2.6        Indemnification.

 

(a)        To the extent permitted by law, the Company will indemnify and hold
harmless each Holder, each of its officers, directors and partners, legal
counsel and accountants and each person controlling such Holder within the
meaning of Section 15 of the Securities Act, with respect to which registration,
qualification or compliance has been effected pursuant to this Section 2, and
each underwriter, if any, and each person who controls within the meaning of
Section 15 of the Securities Act any underwriter, against all expenses, claims,
losses, damages and liabilities (or actions, proceedings or settlements in
respect thereof) arising out of or based on: (i) any untrue statement (or
alleged untrue statement) of a material fact contained or incorporated by
reference in any registration statement, any prospectus included in the
registration statement, any issuer free writing prospectus (as defined in Rule
433 of the Securities Act), any issuer information (as defined in Rule 433 of
the Securities Act) filed or required to be filed pursuant to Rule 433(d) under
the Securities Act or any other document incident to any such registration,
qualification or compliance prepared by or on behalf of the Company or used or
referred to by the Company, (ii) any omission (or alleged omission) to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, or (iii) any violation (or alleged violation)
by the Company of the Securities Act, any state securities laws or any rule or
regulation thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any offering covered by such
registration, qualification or compliance, and the Company will reimburse each
such Holder, each of its officers, directors, partners, legal counsel and
accountants and each person controlling such Holder, each such underwriter and
each person who controls any such underwriter, for any legal and any other
expenses reasonably incurred in connection with investigating and defending or
settling any such claim, loss, damage, liability or action; provided that the
Company will not be liable in any such case to the extent that any such claim,
loss, damage, liability, or action arises out of or is based on any untrue
statement or omission based upon written information furnished to the Company by
such Holder, any of such Holder’s officers, directors, partners, legal counsel
or accountants, any person controlling such Holder, such underwriter or any
person who controls any such underwriter, and stated to be specifically for use
therein; and provided, further that, the indemnity agreement contained in this
Section 2.6(a) shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or action if such settlement is effected without the
consent of the Company (which consent shall not be unreasonably withheld).

 

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(b)        To the extent permitted by law, each Holder will, if Registrable
Securities held by such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify and hold
harmless the Company, each of its directors, officers, partners, legal counsel
and accountants and each underwriter, if any, of the Company’s securities
covered by such a registration statement, each person who controls the Company
or such underwriter within the meaning of Section 15 of the Securities Act, each
other such Holder, and each of their officers, directors and partners, and each
person controlling each other such Holder, against all claims, losses, damages
and liabilities (or actions in respect thereof) arising out of or based on: (i)
any untrue statement (or alleged untrue statement) of a material fact contained
or incorporated by reference in any prospectus, offering circular or other
document (including any related registration statement, notification, or the
like) incident to any such registration, qualification or compliance, or (ii)
any omission (or alleged omission) to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
and will reimburse the Company and such Holders, directors, officers, partners,
legal counsel and accountants, persons, underwriters, or control persons for any
legal or any other expenses reasonably incurred in connection with investigating
or defending any such claim, loss, damage, liability or action, in each case to
the extent, but only to the extent, that such untrue statement (or alleged
untrue statement) or omission (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in reliance upon and
in conformity with written information furnished to the Company by such Holder
and stated to be specifically for use therein; provided, however, that the
obligations of such Holder hereunder shall not apply to amounts paid in
settlement of any such claims, losses, damages or liabilities (or actions in
respect thereof) if such settlement is effected without the consent of such
Holder (which consent shall not be unreasonably withheld); and provided that in
no event shall any indemnity under this Section 2.6 exceed the net proceeds from
the offering received by such Holder, except in the case of fraud or willful
misconduct by such Holder.

 

(c)        Each party entitled to indemnification under this Section 2.6 (the
“Indemnified Party”) shall give notice to the party required to provide
indemnification (the “Indemnifying Party”) promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of such claim or any
litigation resulting therefrom; provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party (whose approval shall not
be unreasonably withheld), and the Indemnified Party may participate in such
defense at such party’s expense; and provided further that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 2.6, to the extent such
failure is not prejudicial. No Indemnifying Party, in the defense of any such
claim or litigation, shall, except with the consent of each Indemnified Party,
consent to entry of any judgment or enter into any settlement that does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect to such
claim or litigation. Each Indemnified Party shall furnish such information
regarding itself or the claim in question as an Indemnifying Party may
reasonably request in writing and as shall be reasonably required in connection
with defense of such claim and litigation resulting therefrom.

 

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(d)        If the indemnification provided for in this Section 2.6 is held by a
court of competent jurisdiction to be unavailable to an Indemnified Party with
respect to any loss, liability, claim, damage, or expense referred to herein,
then the Indemnifying Party, in lieu of indemnifying such Indemnified Party
hereunder, shall contribute to the amount paid or payable by such Indemnified
Party as a result of such loss, liability, claim, damage, or expense in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and of the Indemnified Party on the other in connection
with the statements or omissions that resulted in such loss, liability, claim,
damage, or expense as well as any other relevant equitable considerations. The
relative fault of the Indemnifying Party and of the Indemnified Party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the Indemnifying Party or by the Indemnified
Party and the parties’ relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission. No person or
entity will be required under this Section 2.6(d) to contribute any amount in
excess of the gross proceeds from the offering received by such person or
entity, except in the case of fraud or willful misconduct by such person or
entity. No person or entity guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) will be entitled to contribution
from any person or entity who was not guilty of such fraudulent
misrepresentation.

 

(e)        Notwithstanding the foregoing, to the extent that the provisions on
indemnification and contribution contained in the underwriting agreement entered
into in connection with the underwritten public offering are in conflict with
the foregoing provisions, the provisions in the underwriting agreement shall
control.1

 

2.7        Information by Holder. Each Holder of Registrable Securities shall
furnish to the Company such information regarding such Holder and the
distribution proposed by such Holder as the Company may reasonably request in
writing and as shall be reasonably required in connection with any registration,
qualification, or compliance referred to in this Section 2.

 

2.8        Restrictions on Transfer.

 

(a)        The holder of each certificate representing Registrable Securities by
acceptance thereof agrees to comply in all respects with the provisions of this
Section 2.8. Each Holder agrees not to make any sale, assignment, transfer,
pledge or other disposition of all or any portion of the Restricted Securities,
or any beneficial interest therein, unless and until the transferee thereof has
agreed in writing for the benefit of the Company to take and hold such
Restricted Securities subject to, and to be bound by, the terms and conditions
set forth in this Agreement, including, without limitation, this Section 2.8 and
Section 2.10, and:

 

(i)        There is then in effect a registration statement under the Securities
Act covering such proposed disposition and the disposition is made in accordance
with the registration statement; or

 

(ii)        The Holder shall have given prior written notice to the Company of
the Holder’s intention to make such disposition and shall have furnished the
Company with a detailed description of the manner and circumstances of the
proposed disposition, and, if requested by the Company, the Holder shall have
furnished the Company, at its expense, with evidence reasonably satisfactory to
the Company that such disposition will not require registration of such
Restricted Securities under the Securities Act, whereupon the holder of such
Restricted Securities shall be entitled to transfer such Restricted Securities
in accordance with the terms of the notice delivered by the Holder to the
Company. It is agreed that the Company will not require opinions of counsel for
transactions made pursuant to Rule 144 except in unusual circumstances.

 

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(b)        Notwithstanding the provisions of Section 2.8 (a), no such
registration statement or opinion of counsel or “no action” letter shall be
necessary for (i) a transfer not involving a change in beneficial ownership, or
(ii) in transactions involving the distribution without consideration of
Restricted Securities by any Holder to (x) a parent, subsidiary or other
affiliate of the Holder, if the Holder is a corporation, (y) any of the Holder’s
partners, members or other equity owners, or retired partners, retired members
or other equity owners, or to the estate of any of the Holder’s partners,
members or other equity owners or retired partners, retired members or other
equity owners, or (z) a venture capital fund that is controlled by or under
common control with one or more general partners or managing members of, or
shares the same management company with, the Holder; provided, in each case,
that the Holder shall give written notice to the Company of the Holder’s
intention to effect such disposition and shall have furnished the Company with a
detailed description of the manner and circumstances of the proposed
disposition.

 

2.9        Rule 144 Reporting. With a view to making available the benefits of
certain rules and regulations of the Commission that may permit the sale of the
Restricted Securities to the public without registration, the Company agrees to
use its commercially reasonable best efforts to:

 

(a)        Make and keep adequate current public information with respect to the
Company available in accordance with Rule 144 under the Securities Act, at all
times from and after ninety (90) days following the effective date of the first
registration under the Securities Act filed by the Company for an offering of
its securities to the general public;

 

(b)        File with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act
at any time after it has become subject to such reporting requirements; and

 

(c)        So long as a Holder owns any Restricted Securities, furnish to the
Holder forthwith upon written request a written statement by the Company as to
its compliance with the reporting requirements of Rule 144 (at any time from and
after ninety (90) days following the effective date of the first registration
statement filed by the Company for an offering of its securities to the general
public), and of the Securities Act and the Exchange Act (at any time after it
has become subject to such reporting requirements), a copy of the most recent
annual or quarterly report of the Company, and such other reports and documents
so filed as a Holder may reasonably request in availing itself of any rule or
regulation of the Commission allowing a Holder to sell any such securities
without registration.

 

2.10        Delay of Registration. No Holder shall have any right to take any
action to restrain, enjoin, or otherwise delay any registration as the result of
any controversy that might arise with respect to the interpretation or
implementation of this Section 2.

 

2.11        Transfer or Assignment of Registration Rights. The rights to cause
the Company to register securities granted to a Holder by the Company under this
Section 2 may be transferred or assigned by a Holder only to a transferee or
assignee of not less than 100,000 shares of Registrable Securities (as presently
constituted and subject to subsequent adjustments for stock splits, stock
dividends, reverse stock splits, and the like); provided that (i) such transfer
or assignment of Registrable Securities is effected in accordance with the terms
of Section 2.8 hereof, and applicable securities laws, (ii) the Company is given
written notice prior to said transfer or assignment, stating the name and
address of the transferee or assignee and identifying the securities with
respect to which such registration rights are intended to be transferred or
assigned and (iii) the transferee or assignee of such rights assumes in writing
the obligations of such Holder under this Agreement, including without
limitation the obligations set forth in Section 2.10.

 

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2.12        Limitations on Subsequent Registration Rights. From and after the
date of this Agreement, the Company shall not, without the prior written consent
of the Holders, enter into any agreement with any holder or prospective holder
of any securities of the Company giving such holder or prospective holder any
registration rights the terms of which are pari passu with the registration
rights granted to the Holders hereunder.

 

2.13        Termination of Registration Rights. The right of any Holder to
request registration or inclusion in any registration pursuant to Section 2.1,
2.2 or 2.3 shall terminate on the fourth anniversary of this Agreement.

 

Section 3

Miscellaneous

 

3.1        Amendment. Except as expressly provided herein, neither this
Agreement nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument referencing this Agreement and signed by the
Company and the Investor.

 

3.2        Notices. All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, sent by facsimile or electronic mail or otherwise
delivered by hand or by messenger addressed:

 

(a)        if to the Investor, at the Investor’s address, facsimile number or
electronic mail address as shown in the Company’s records, as may be updated in
accordance with the provisions hereof;

 

(b)        if to any Holder, at such address, facsimile number or electronic
mail address as shown in the Company’s records, or, until any such holder so
furnishes an address, facsimile number or electronic mail address to the
Company, then to and at the address of the last holder of such shares for which
the Company has contact information in its records; or

 

(c)        if to the Company, one copy should be sent to 701 N. Green Valley
Pkwy, Ste 200-258, Henderson, NV, 89074, Attn: Chief Executive Officer, or at
such other address as the Company shall have furnished to the Investor.

 

Each such notice or other communication shall for all purposes of this Agreement
be treated as effective or having been given when delivered if delivered
personally, or, if sent by mail, at the earlier of its receipt or 72 hours after
the same has been deposited in a regularly maintained receptacle for the deposit
of the United States mail, addressed and mailed as aforesaid or, if sent by
facsimile, upon confirmation of facsimile transfer or, if sent by electronic
mail, upon confirmation of delivery when directed to the electronic mail address
on record with the Company.

 

3.3        Governing Law. This Agreement shall be governed in all respects by
the internal laws of the State of Nevada as applied to agreements entered into
among Nevada residents to be performed entirely within Nevada, without regard to
principles of conflicts of law.

 

3.4        Successors and Assigns. This Agreement, and any and all rights,
duties and obligations hereunder, shall not be assigned, transferred, delegated
or sublicensed by any Investor without the prior written consent of the Company.
Any attempt by an Investor without such permission to assign, transfer, delegate
or sublicense any rights, duties or obligations that arise under this Agreement
shall be void. Subject to the foregoing and except as otherwise provided herein,
the provisions of this Agreement shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.

 

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3.5        Entire Agreement. This Agreement and the exhibits hereto constitute
the full and entire understanding and agreement between the parties with regard
to the subjects hereof. No party hereto shall be liable or bound to any other
party in any manner with regard to the subjects hereof or thereof by any
warranties, representations or covenants except as specifically set forth
herein.

 

3.6        Delays or Omissions. Except as expressly provided herein, no delay or
omission to exercise any right, power or remedy accruing to any party to this
Agreement upon any breach or default of any other party under this Agreement
shall impair any such right, power or remedy of such non-defaulting party, nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring, nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
party of any breach or default under this Agreement, or any waiver on the part
of any party of any provisions or conditions of this Agreement, must be in
writing and shall be effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement or by law or otherwise
afforded to any party to this Agreement, shall be cumulative and not
alternative.

 

3.7        Severability. If any provision of this Agreement becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, portions of such provision, or such provision in its entirety, to the
extent necessary, shall be severed from this Agreement, and such court will
replace such illegal, void or unenforceable provision of this Agreement with a
valid and enforceable provision that will achieve, to the extent possible, the
same economic, business and other purposes of the illegal, void or unenforceable
provision. The balance of this Agreement shall be enforceable in accordance with
its terms.

 

3.8        Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement. All references in this Agreement to sections,
paragraphs and exhibits shall, unless otherwise provided, refer to sections and
paragraphs hereof and exhibits attached hereto.

 

3.9        Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties that
execute such counterparts, and all of which together shall constitute one
instrument.

 

3.10        Telecopy Execution and Delivery. A facsimile, telecopy or other
reproduction of this Agreement may be executed by one or more parties hereto and
delivered by such party by facsimile or any similar electronic transmission
device pursuant to which the signature of or on behalf of such party can be
seen. Such execution and delivery shall be considered valid, binding and
effective for all purposes. At the request of any party hereto, all parties
hereto agree to execute and deliver an original of this Agreement as well as any
facsimile, telecopy or other reproduction hereof.

 

3.11        Jurisdiction; Venue. With respect to any disputes arising out of or
related to this Agreement, the parties consent to the exclusive jurisdiction of,
and venue in, the state courts in Nevada.

 

3.12        Further Assurances. Each party hereto agrees to execute and deliver,
by the proper exercise of its corporate, limited liability company, partnership
or other powers, all such other and additional instruments and documents and do
all such other acts and things as may be necessary to more fully effectuate this
Agreement.

 

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3.13        Termination Upon Change of Control. Notwithstanding anything to the
contrary herein, this Agreement (excluding any then-existing obligations) shall
terminate upon (a) the acquisition of the Company by another entity by means of
any transaction or series of related transactions to which the Company is party
(including, without limitation, any stock acquisition, reorganization, merger or
consolidation but excluding any sale of stock for capital raising purposes)
other than a transaction or series of transactions in which the holders of the
voting securities of the Company outstanding immediately prior to such
transaction continue to retain (either by such voting securities remaining
outstanding or by such voting securities being converted into voting securities
of the surviving entity), as a result of shares in the Company held by such
holders prior to such transaction, at least fifty percent (50%) of the total
voting power represented by the voting securities of the Corporation or such
surviving entity outstanding immediately after such transaction or series of
transactions; or (b) a sale, lease or other conveyance of all substantially all
of the assets of the Company.

 

3.14        Conflict. In the event of any conflict between the terms of this
Agreement and the Company’s Articles or its Bylaws, the terms of the Company’s
Articles or its Bylaws, as the case may be, will control.

 

3.15        Attorneys’ Fees. In the event that any suit or action is instituted
to enforce any provision in this Agreement, the prevailing party in such dispute
shall be entitled to recover from the losing such reasonable fees and expenses
of attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.

 

3.16        Aggregation of Stock. All securities held or acquired by affiliated
entities (including affiliated venture capital funds) or persons shall be
aggregated together for purposes of determining the availability of any rights
under this Agreement.

 

(signature page follows)

 

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The parties hereto have executed this Investors’ Rights Agreement effective as
of the day and year first above written.

 

  NORTHUMBERLAND RESOURCES INC.       By:  /s/ Fortunato Villamagna   Name:
Fortunato Villamagna   Title: President       INVESTOR       THORFINN PARTNERS  
(Print investor name)       /s/ Charles Patrick   (Signature)       Charles
Patrick   (Print name of signatory, if signing for an entity)