SUBSCRIPTION AGREEMENT
 
THIS SUBSCRIPTION AGREEMENT (this “Agreement”), is dated as of February 23,
2012, by and among Sagebrush Gold Ltd., a Nevada corporation (the “Company”),
Frost Gamma Investments Trust, a Florida Trust (“FGIT”) and Michael Brauser
(“Brauser,” and together with FGIT, each a “Subscriber” and collectively, the
“Subscribers”).

WHEREAS, the Company and the Subscribers are executing and delivering this
Agreement in reliance upon an exemption from securities registration afforded by
the provisions of Section 4(2), Section 4(5) and/or Regulation D (“Regulation
D”) as promulgated by the United States Securities and Exchange Commission (the
“Commission”) under the Securities Act of 1933, as amended (the “Securities
Act”).
 
WHEREAS, the parties desire that, upon the terms and subject to the conditions
contained herein, the Company shall issue and sell to the Subscribers, as
provided herein, and the Subscribers shall purchase (i) for an aggregate
purchase price of $1,000,000, as set forth and allocated on the signature page
hereto (the “Purchase Price”) 1,000,000 shares of the Company’s 9% Series D
Cumulative Convertible Preferred Stock, as set forth and allocated on the
signature page hereto (the “Preferred Stock”), with such rights and designations
as set forth in the Certificate of Designation (the “Certificate of
Designation”), the form of which is annexed hereto as Exhibit A, convertible
into shares of the Company’s Common Stock, $0.0001 par value (the “Common
Stock”) at a per share conversion price set forth in the Certificate of
Designation (“Conversion Price”); and (ii) share purchase warrants (the
“Warrants” and collectively with the Certificate of Designation and this
Agreement, the Preferred Stock, the Warrant Shares (as defined below) and any
other agreements delivered together with this Agreement or in connection
herewith, collectively, the “Transaction Documents”) in the form attached hereto
as Exhibit B, to purchase 8,750,000 shares of the Company’s Common Stock, as set
forth and allocated on the signature page hereto (the “Warrant Shares”) (the
“Offering”).  The Preferred Stock, shares of Common Stock issuable upon
conversion of the Preferred Stock (the “Shares” or “Conversion Shares”), the
Warrants and the Warrant Shares are collectively referred to herein as the
“Securities.”
 
NOW, THEREFORE, in consideration of the mutual covenants and other agreements
contained in this Agreement the Company and the Subscribers hereby agree as
follows:
 
1.           Closing Date.   The “Closing Date” shall be the date that the
Purchase Price is transmitted by wire transfer or otherwise credited to or for
the benefit of the Company. The consummation of the transactions contemplated
herein shall take place at the offices of Sichenzia Ross Friedman Ference LLP,
upon the satisfaction or waiver of all conditions to closing set forth in this
Agreement.   Subject to the satisfaction or waiver of the terms and conditions
of this Agreement, on the Closing Date, the Subscribers shall purchase and the
Company shall sell to Subscribers the Preferred Stock and Warrants as described
in Section 2 of this Agreement.

2.           Preferred Stock, Shares and Warrants.

(a)           Preferred Stock.   Subject to the satisfaction or waiver of the
terms and conditions of this Agreement, on the Closing Date, the Subscribers
shall purchase and the Company shall sell to the Subscribers 1,000,000 shares of
the Company’s Preferred Stock, as set forth and allocated on the signature page
hereto.

(b)           Warrants.  On the Closing Date, the Company will issue and deliver
the Warrants to the Subscribers, as set forth and allocated on the signature
page hereto.  The exercise price to acquire a Warrant Share upon exercise of a
Warrant shall be equal $0.40.  The Warrants shall be exercisable until
five years after the issue date of the Warrants.
 
 
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(c)           Allocation of Purchase Price.   The Purchase Price will be
allocated among the components of the Securities so that each component of the
Securities will be fully paid and non-assessable.

3.           Use of Proceeds. The Company hereby agrees that the proceeds from
the aggregate Purchase Price shall be applied on the Closing Date to prepay (i)
$800,000 of that certain senior secured convertible promissory note dated August
30, 2011 in the original principal amount of $6,400,000 to Platinum Long Term
Growth LLC (“Platinum”) and (ii) $200,000 of that certain senior secured
convertible promissory note dated August 30, 2011 in the original principal
amount of $1,600,000 to Lakewood Group LLC (“Lakewood”).
 

4.           Subscribers Representations and Warranties.  Each Subscriber hereby
represents and warrants (individually and not jointly) to and agrees with the
Company that:

(a)           Authorization and Power.  Such Subscriber has the requisite power
and authority to enter into and perform this Agreement and the other Transaction
Documents and to purchase the Preferred Stock being sold to it hereunder.  The
execution, delivery and performance of this Agreement and the other Transaction
Documents by such Subscriber and, with respect to FGIT, the consummation by it
of the transactions contemplated hereby and thereby have been duly authorized by
all necessary corporate action, and no further consent or authorization of FGIT
is required.  This Agreement has been duly authorized, executed and when
delivered by such Subscriber shall constitute a valid and binding obligation of
such Subscriber enforceable against such Subscriber in accordance with the terms
thereof.

(c)           No Conflicts.  The execution, delivery and performance of this
Agreement and the consummation by such Subscriber of the transactions
contemplated hereby and thereby or relating hereto do not and will not (i)
solely with respect to FGIT, result in a violation of FGIT’s organizational
documents, (ii) conflict with nor constitute a default (or an event which with
notice or lapse of time or both would become a default) under, nor (iii) result
in a violation of any law, rule, or regulation, or any order, judgment or decree
of any court or governmental agency applicable to such Subscriber or its
properties (except for such conflicts, defaults and violations as would not,
individually or in the aggregate, have a material adverse effect on such
Subscriber).  Such Subscriber is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any court or
governmental agency in order for it to execute, deliver or perform any of its
obligations under this Agreement and the other Transaction Documents  nor to
purchase the Securities in accordance with the terms hereof, provided that for
purposes of the representation made in this sentence, Subscriber is assuming and
relying upon the accuracy of the relevant representations and agreements of the
Company herein.

                                           (d)   Information on
Subscribers.   Such Subscriber is, and will be at the time of the conversion of
the Preferred Stock and exercise of the Warrants, an "accredited investor", as
such term is defined in Regulation D promulgated by the Commission under the
Securities Act, is experienced in investments and business matters, has made
investments of a speculative nature and has purchased securities of United
States publicly-owned companies in private placements in the past and, with its
representatives, has such knowledge and experience in financial, tax and other
business matters as to enable such Subscriber to utilize the information made
available by the Company to evaluate the merits and risks of and to make an
informed investment decision with respect to the proposed purchase, which
represents a speculative investment.  Such Subscriber is able to bear the risk
of such investment for an indefinite period and to afford a complete loss
thereof.  The information set forth on the signature page hereto regarding such
Subscriber  is accurate.

(e)           Purchase of Preferred Stock and Warrants.  On the Closing Date,
such Subscriber  will purchase the Preferred Stock and Warrant as principal for
its own account for investment only and not with a view toward, or for resale in
connection with, the public sale or any distribution thereof.
 
 
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(f)           Compliance with Securities Act.   Such Subscriber understands and
agrees that the Securities have not been registered under the Securities Act or
any applicable state securities laws, by reason of their issuance in a
transaction that does not require registration under the Securities Act (based
in part on the accuracy of the representations and warranties of such Subscriber
contained herein), and that such Securities must be held indefinitely unless a
subsequent disposition is registered under the Securities Act or any applicable
state securities laws or is exempt from such registration.  In any event, and
subject to compliance with applicable securities laws, such Subscriber may enter
into lawful hedging transactions in the course of hedging the position they
assume and such Subscriber may also enter into lawful short positions or other
derivative transactions relating to the Securities, or interests in the
Securities, and deliver the Securities, or interests in the Securities, to close
out their short or other positions or otherwise settle other transactions, or
loan or pledge the Securities, or interests in the Securities, to third parties
who in turn may dispose of these Securities.

(g)           Conversion Shares and Warrant Shares Legend.  The Conversion
Shares and Warrant Shares shall bear the following or similar legend:

"THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAS NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR APPLICABLE
STATE SECURITIES LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
(B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A
GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
(II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED
BY THE SECURITIES."

(h)           Preferred Stock and Warrant Legend.  The Preferred Stock and
Warrant shall bear the following legend:
 
"NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE [CONVERTIBLE –OR-EXERCISABLE]
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
(B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A
GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
(II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED
BY THE SECURITIES."
 
 
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(i)           Communication of Offer.  The offer to sell the Securities was
directly communicated to such Subscriber by the Company.  At no time was such
Subscriber presented with or solicited by any leaflet, newspaper or magazine
article, radio or television advertisement, or any other form of general
advertising or solicited or invited to attend a promotional meeting otherwise
than in connection and concurrently with such communicated offer.

(j)           Restricted Securities.   Such Subscriber understands that the
Securities have not been registered under the Securities Act and such Subscriber
will not sell, offer to sell, assign, pledge, hypothecate or otherwise transfer
any of the Securities unless pursuant to an effective registration statement
under the Securities Act, or unless an exemption from registration is
available.  Notwithstanding anything to the contrary contained in this
Agreement, such Subscriber may transfer (without restriction and without the
need for an opinion of counsel) the Securities to its Affiliates (as defined
below) provided that each such Affiliate is an “accredited investor” under
Regulation D and such Affiliate agrees to be bound by the terms and conditions
of this Agreement. For the purposes of this Agreement, an “Affiliate” of any
person or entity means any other person or entity directly or indirectly
controlling, controlled by or under direct or indirect common control with such
person or entity.  Affiliate includes each Subsidiary of such Subscriber.  For
purposes of this definition, “control” means the power to direct the management
and policies of such person or firm, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise.

(k)           No Governmental Review.  Such Subscriber understands that no
United States federal or state agency or any other governmental or state agency
has passed on or made recommendations or endorsement of the Securities or the
suitability of the investment in the Securities nor have such authorities passed
upon or endorsed the merits of the offering of the Securities.

(l)           Correctness of Representations.  Such Subscriber represents that
the foregoing representations and warranties are true and correct as of the date
hereof and, unless such Subscriber otherwise notifies the Company prior to the
Closing Date shall be true and correct as of the Closing Date.

(m)           Survival.  The foregoing representations and warranties shall
survive the Closing Date.
 
5.           Company Representations and Warranties.  The Company represents and
warrants to and agrees with each Subscriber that:
 
(a)           Due Incorporation.  The Company is a corporation duly
incorporated, validly existing and in good standing under the laws of the State
of Nevada and has the requisite corporate power to own its properties and to
carry on its business as presently conducted.  The Company is duly qualified as
a foreign corporation to do business and is in good standing in each
jurisdiction where the nature of the business conducted or property owned by it
makes such qualification necessary, other than those jurisdictions in which the
failure to so qualify would not have a Material Adverse Effect.  For purposes of
this Agreement, a “Material Adverse Effect” shall mean a material adverse effect
on the financial condition, results of operations, prospects, properties or
business of the Company and its Subsidiaries taken as a whole.  For purposes of
this Agreement, “Subsidiary” means, with respect to any entity at any date, any
corporation, limited or general partnership, limited liability company, trust,
estate, association, joint venture or other business entity of which more than
30% of (i) the outstanding capital stock having (in the absence of
contingencies) ordinary voting power to elect a majority of the board of
directors or other managing body of such entity, (ii) in the case of a
partnership or limited liability company, the interest in the capital or profits
of such partnership or limited liability company or (iii) in the case of a
trust, estate, association, joint venture or other entity, the beneficial
interest in such trust, estate, association or other entity business is, at the
time of determination, owned or controlled directly or indirectly through one or
more intermediaries, by such entity.
 
 
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(b)           Outstanding Stock.  All issued and outstanding shares of capital
stock and equity interests in the Company have been duly authorized and validly
issued and are fully paid and non-assessable.
 
(c)           Authority; Enforceability.  The Transaction Documents have been
duly authorized, executed and delivered by the Company and/or Subsidiaries and
are valid and binding agreements of the Company enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights generally and to general principles of
equity.  The Company has full corporate power and authority necessary to enter
into and deliver the Transaction Documents and to perform its obligations
thereunder.
 
(d)           Capitalization and Additional Issuances.   The authorized and
outstanding capital stock of the Company and Subsidiaries is set forth in the
SEC Reports.  The only officer, director, employee and consultant stock option
or stock incentive plan or similar plan currently in effect or contemplated by
the Company is in the SEC Reports.  There are no outstanding agreements or
preemptive or similar rights affecting the Company's Common Stock.
 
(e)           Consents.  No consent, approval, authorization or order of any
court, governmental agency or body or arbitrator having jurisdiction over the
Company, or any of its Affiliates, the OTC Bulletin Board (the “Bulletin Board”)
or the Company's shareholders is required for the execution by the Company of
the Transaction Documents and compliance and performance by the Company of its
obligations under the Transaction Documents, including, without limitation, the
issuance and sale of the Securities.  The Transaction Documents and the
Company’s performance of its obligations thereunder has been unanimously
approved by the Company’s Board of Directors.  No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any governmental authority in the world, including without
limitation, the United States, or elsewhere is required by the Company or any
Affiliate of the Company in connection with the consummation of the transactions
contemplated by this Agreement, except as would not otherwise have a Material
Adverse Effect or affect the consummation of any of the other agreements,
covenants or commitments of the Company or any Subsidiary contemplated by the
other Transaction Documents. Any such qualifications and filings will, in the
case of qualifications, be effective on the Closing and will, in the case of
filings, be made within the time prescribed by law.
 
(f)           No Violation or Conflict.  Assuming the representations and
warranties of the Subscribers in Section 4 are true and correct, neither the
issuance nor sale of the Securities nor the performance of the Company’s
obligations under this Agreement and all other agreements entered into by the
Company relating thereto by the Company will:
 
(i)           violate, conflict with, result in a breach of, or constitute a
default (or an event which with the giving of notice or the lapse of time or
both would be reasonably likely to constitute a default) under (A) the articles
or certificate of incorporation, charter or bylaws of the Company, (B) to the
Company's knowledge, any decree, judgment, order, law, treaty, rule, regulation
or determination applicable to the Company of any court, governmental agency or
body, or arbitrator having jurisdiction over the Company or over the properties
or assets of the Company or any of its Affiliates, (C) the terms of any bond,
debenture, note or any other evidence of indebtedness, or any agreement, stock
option or other similar plan, indenture, lease, mortgage, deed of trust or other
instrument to which the Company or any of its Affiliates is a party, by which
the Company or any of its Affiliates is bound, or to which any of the properties
of the Company or any of its Affiliates is subject, or (D) the terms of any
"lock-up" or similar provision of any underwriting or similar agreement to which
the Company, or any of its Affiliates is a party except the violation, conflict,
breach, or default of which would not have a Material Adverse Effect; or
 
 
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(ii)           result in the creation or imposition of any lien, charge or
encumbrance upon the Securities or any of the assets of the Company or any of
its Affiliates except in favor of such Subscriber as described herein; or
 
 (g)           The Securities.  The Securities upon issuance:
 
(i)            are, or will be, free and clear of any security interests, liens,
claims or other encumbrances, subject only to restrictions upon transfer under
the Securities Act and any applicable state securities laws;

(ii)           have been, or will be, duly and validly authorized and on the
dates of issuance of the Conversion Shares upon conversion of the Preferred
Stock, and the Warrant Shares upon exercise of the Warrants, such Shares and
Warrant Shares will be duly and validly issued, fully paid and non-assessable
and if registered pursuant to the Securities Act and resold pursuant to an
effective registration statement or exempt from registration will be free
trading, unrestricted and unlegended;
 
(iii)          will not have been issued or sold in violation of any preemptive
or other similar rights of the holders of any securities of the Company or
rights to acquire securities of the Company;
 
(iv)          will not subject the holders thereof to personal liability by
reason of being such holders; and
 
                (v)           assuming the representations warranties of the
Subscribers as set forth in Section 4 hereof are true and correct, will not
result in a violation of Section 5 under the Securities Act.
 

 
(h)           No Market Manipulation.  The Company and its Affiliates have not
taken, and will not take, directly or indirectly, any action designed to, or
that might reasonably be expected to, cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the sale or resale
of the Securities or affect the price at which the Securities may be issued or
resold.
 
(i)           No General Solicitation.  Neither the Company, nor any of its
Affiliates, nor to its knowledge, any person acting on its or their behalf, has
engaged in any form of general solicitation or general advertising (within the
meaning of Regulation D under the Securities Act) in connection with the offer
or sale of the Securities.
 
(j)           Listing.  The Company's Common Stock is quoted on the Bulletin
Board under the symbol “SAGE”.  The Company has not received any oral or written
notice that its Common Stock is not eligible nor will become ineligible for
quotation on the Bulletin Board nor that its Common Stock does not meet all
requirements for the continuation of such quotation.  The Company satisfies all
the requirements for the continued quotation of its Common Stock on the Bulletin
Board.
 
 
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(k)           Information on Company.   The Company has filed all reports
required to be filed by it under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), including pursuant to Section 13(a) or 15(d) thereof, for
the twelve months preceding the date hereof (the foregoing materials (together
with any materials filed by the Company under the Exchange Act, whether or not
required), collectively referred to herein as the “SEC Reports”). The Company
has made available to each  Subscriber or its representatives true, correct and
complete copies of the SEC Reports including, without limitation, the
registration statement filed by the Company with the Securities and Exchange
Commission (the “Commission”) on January 18, 2012 (the “Registration Statement,”
and together with the SEC Reports, collectively, the “Information Package”). As
of their respective dates, the SEC Reports complied in all material respects
with the requirements of the Securities Act of 1933, as amended (the “Securities
Act”) and the Exchange Act and the rules and regulations of the Commission
promulgated thereunder, and none of the SEC Reports, when filed, contained any
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading. The
financial statements of the Company contained in the Information Package comply
in all materials respects with applicable accounting requirements and the rules
and regulations of the Commission with respect thereto as in effect at the time
of filing. Such financial statements have been prepared in accordance with
generally accepted principles of good accounting practice in the United States,
consistently applied during the periods involved, except as may be otherwise
specified in such financial statements or the notes thereto, and fairly present
in all materials respects the financial position of the Company and its
consolidated subsidiaries as of and for the dates thereof and the results of
operations and cash flows for the period then ended, subject, in the case of
unaudited statements, to normal, year-end audit adjustments.

 (l)           Correctness of Representations.  The Company represents that the
foregoing representations and warranties are true and correct as of the date
hereof in all material respects, and, unless the Company otherwise notifies the
Subscribers prior to the Closing Date, shall be true and correct in all material
respects as of the Closing Date; provided, that, if such representation or
warranty is made as of a different date, in which case such representation or
warranty shall be true as of such date.
 
(m)           Survival.  The foregoing representations and warranties shall
survive the Closing Date.
 
6.           Regulation D Offering/.  The offer and issuance of the Securities
to the Subscribers is being made pursuant to the exemption from the registration
provisions of the Securities Act afforded by Section 4(2) or Section 4(5) of the
Securities Act and/or Rule 506 of Regulation D promulgated thereunder.

                      7.           Conversion of the Preferred Stock.

(a)           Upon the conversion of the Preferred Stock or part thereof, the
Company shall, at its own cost and expense, take all necessary action, including
obtaining and delivering, an opinion of counsel to assure that the Company's
transfer agent shall issue stock certificates in the name of the applicable
Subscriber (or its permitted nominee) or such other persons as designated by
such Subscriber and in such denominations to be specified at conversion
representing the number of shares of Common Stock issuable upon such
conversion.  The Company warrants that no instructions other than these
instructions have been or will be given to the transfer agent of the Company's
Common Stock and that the certificates representing such shares shall contain no
legend other than the legend set forth in Section 4(h).  If and when such
Subscriber sells the Shares, assuming (i) a registration statement including
such Shares for registration, filed with the Commission is effective and the
prospectus, as supplemented or amended, contained therein is current and (ii)
such Subscriber or its agent confirms in writing to the transfer agent that such
Subscriber has complied with the prospectus delivery requirements, the Company
will reissue the Shares without restrictive legend and the Shares will be
free-trading, and freely transferable.  In the event that the Shares are sold in
a manner that complies with an exemption from registration, the Company will
promptly instruct its counsel to issue to the transfer agent an opinion
permitting removal of the legend indefinitely, if pursuant to Rule 144(b)(1)(i)
of the Securities Act, or for 90 days if pursuant to the other provisions of
Rule 144 of the Securities Act, provided that such Subscriber delivers all
reasonably requested representations in support of such opinion.
 
 
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(b)           Each Subscriber will give notice of its decision to exercise its
right to convert the Preferred Stock, or part thereof by telecopying, or
otherwise delivering a completed Notice of Conversion (a form of which is
annexed as Exhibit A to the Certificate of Designation) to the Company via
confirmed telecopier transmission or otherwise pursuant to Section 11(a) of this
Agreement.  Each date on which a Notice of Conversion is telecopied to the
Company in accordance with the provisions hereof by 6 PM Eastern Time (“ET”) (or
if received by the Company after 6 PM ET, then the next business day) shall be
deemed a “Conversion Date.”  The Company will itself or cause the Company’s
transfer agent to transmit the Company's Common Stock certificates representing
the Conversion Shares issuable upon conversion of the Preferred Stock to such
Subscriber via express courier for receipt by such Subscriber within three (3)
business days after the Conversion Date (such third day being the "Delivery
Date").  In the event the Conversion Shares are electronically transferable,
then delivery of the Shares must be made by electronic transfer provided request
for such electronic transfer has been made by such Subscriber.   A certificate
representing the balance of the Preferred Stock not so converted will be
provided by the Company to such Subscriber if requested by such Subscriber,
provided such Subscriber delivers the original certificate representing the
Preferred Stock to the Company.

 
           8.           Limitation on Volume For so long as no Event of Default
(as defined in the Acquired Notes (as defined in that certain Note assignment
and assumption agreement dated the date hereof by and among the Company, Gold
Acquisition Corp., Platinum, Lakewood, FGIT and Brauser)) has occurred and is
continuing under the Acquired Notes and the Acquired Notes remain outstanding,
each Subscriber agrees that, during any week, such Subscriber and its affiliates
shall not sell, pledge, transfer or dispose of the Securities or shares of
common stock of the Company received upon conversion of (or payment of interest
in respect of) the Acquired Notes or the Preferred Stock or upon exercise of the
Warrants in excess of 10% of the Weekly Volume (as defined below) if the Weekly
Price (as defined below) is less than $.70 per share of the Company’s common
stock (as adjusted for splits and combinations and the like).  “Weekly Volume”
means the volume of shares of the Company’s common stock bought or sold on the
Trading Market (as defined below) as reported by Bloomberg Financial L.P. (based
on a Trading Day from 9:30 a.m. Eastern Time to 4:02 p.m. Eastern Time) during
the preceding week.  “Weekly Price” means the average closing price of the
Company’s common stock for each Trading Day (as defined in the Remaining Notes)
of the prior week on the Trading Market as reported by Bloomberg Financial L.P.
(based on a Trading Day from 9:30 a.m. Eastern Time to 4:02 p.m. Eastern
Time).  The restrictions set forth in this Section 8 may be waived by the
Company in its discretion and shall not apply at any time when the Company’s
common stock is not quoted or admitted for trading on the Trading Market.   The
Company and Platinum and Lakewood have entered into substantially similar
restrictions with respect to the shares of the Company’s common stock to be
received upon conversion of or payment of interest in respect of the Remaining
Notes (as defined in that certain Note Modification Agreement dated on or about
the date hereof (the “Note Modification Agreement”) among the Company, Gold
Acquisition Corp., Platinum and the Lakewood) and exercise of warrants and
Shares (as defined in the Note Modification Agreement) received on or about the
date hereof pursuant to Note Modification Agreement.  Such restrictions on the
Subscribers shall not be waived by the Company unless the restrictions on
Platinum and Lakewood  set forth in Section 3(d) of the Note Modification
Agreement are waived in a substantially equivalent manner.
 
 
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 9.           Covenants of the Company.  The Company covenants and agrees with
the Subscribers as follows:
 
(a)           Stop Orders.  Subject to any  prior notice requirements described
elsewhere herein, the Company will advise the Subscribers, within twenty-four
hours after it receives notice of issuance by the Commission, any state
securities commission or any other regulatory authority of any stop order or of
any order preventing or suspending any offering of any securities of the
Company, or of the suspension of the qualification of the Common Stock of the
Company for offering or sale in any jurisdiction, or the initiation of any
proceeding for any such purpose.  The Company will not issue any stop transfer
order or other order impeding the sale, resale or delivery of any of the
Securities, except as may be required by any applicable federal or state
securities laws and unless contemporaneous notice of such instruction is given
to the Subscribers.
 
(b)           Market Regulations.  If required, the Company shall notify the
Commission, the Principal Market and applicable state authorities, in accordance
with their requirements, of the transactions contemplated by this Agreement, and
shall take all other necessary action and proceedings as may be required and
permitted by applicable law, rule and regulation, for the legal and valid
issuance of the Securities to the Subscribers and promptly provide copies
thereof to the Subscribers.
 
(c)           Use of Proceeds.   The proceeds of the Offering will be employed
by the Company as set forth in Section 3 of the Agreement.
 
(d)           Reservation.   Prior to the Closing, the Company undertakes to
reserve on behalf of the Subscribers from its authorized but unissued Common
Stock, a number of shares of Common Stock equal to 100% of the amount of Common
Stock necessary to allow the Subscribers to be able to convert the Preferred
Stock and 100% of the amount of Warrant Shares issuable upon exercise of the
Warrants (“Required Reservation”).     If at any time the Preferred Stock and
Warrants are outstanding the Company has insufficient Common Stock reserved on
behalf of the Subscribers in an amount less than 100% of the amount necessary
for full conversion of the outstanding Preferred Stock at the conversion price
that would be in effect on every such date and 100% of the Warrant Shares
(“Minimum Required Reservation”), the Company will promptly reserve the Minimum
Required Reservation, or if there are insufficient authorized and available
shares of Common Stock to do so, the Company will take all action necessary to
increase its authorized capital to be able to fully satisfy its reservation
requirements hereunder.  The Company agrees to provide notice to the Subscribers
not later than three days after the date the Company has less than the Minimum
Required Reservation reserved on behalf of the Subscribers.
 
(e)           DTC Program.  At all times that Preferred Stock or Warrants are
outstanding, the Company will employ as the transfer agent for the Common Stock,
Shares and Warrant Shares a participant in the Depository Trust Company
Automated Securities Transfer Program.
 
(f)           Taxes.  As long as the Preferred Stock and the Warrants are
outstanding, the Company will promptly pay and discharge, or cause to be paid
and discharged, when due and payable, all lawful taxes, assessments and
governmental charges or levies imposed upon the income, profits, property or
business of the Company; provided, however, that any such tax, assessment,
charge or levy need not be paid if the validity thereof shall currently be
contested in good faith by appropriate proceedings and if the Company shall have
set aside on its books adequate reserves with respect thereto, and provided,
further, that the Company will pay all such taxes, assessments, charges or
levies forthwith upon the commencement of proceedings to foreclose any lien
which may have attached as security therefore.
 
(g)           Insurance.  As long as the Preferred Stock and the Warrants are
outstanding, the Company will keep its assets which are of an insurable
character insured by financially sound and reputable insurers against loss or
damage by fire, explosion and other risks customarily insured against by
companies in the Company’s line of business and location, in amounts and to the
extent and in the manner customary for companies in similar businesses similarly
situated and located and to the extent available on commercially reasonable
terms.
 
 
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(j)           Books and Records.  As long as the Preferred Stock and the
Warrants are outstanding, the Company will keep true records and books of
account in which full, true and correct entries will be made of all dealings or
transactions in relation to its business and affairs in accordance with
generally accepted accounting principles applied on a consistent basis.
 
(k)           Governmental Authorities.   As long as the Preferred Stock and the
Warrants are outstanding, the Company shall duly observe and conform in all
material respects to all valid requirements of governmental authorities relating
to the conduct of its business or to its properties or assets.
 
 (l)           Confidentiality.  The Parties agree that the terms and conditions
of this Agreement are strictly confidential and will not be disclosed or
discussed to or with any person whomsoever, with the exception only of
disclosure required by court order, and disclosure to the Parties’ respective
attorneys, tax consultant(s) or accountant(s), and/or the duly designated taxing
authorities of the government of the United States of America and/or the
government of any state to which either of the Parties may owe any taxes.
 
                10.           Covenants of the Company Regarding
Indemnification.
 
(a)           The Company agrees to indemnify, hold harmless, reimburse and
defend the Subscribers, the Subscribers’ respective trustees, beneficiaries,
officers, directors, agents, representatives, Affiliates, members, managers, and
control persons against any claim, cost, expense, liability, obligation, loss or
damage (including reasonable legal fees) of any nature, incurred by or imposed
upon the Subscribers or any such person which results, arises out of or is based
upon (i) any material misrepresentation by Company or breach of any
representation or warranty by Company in this Agreement or in any Exhibits or
Schedules attached hereto in any Transaction Document, or other agreement
delivered pursuant hereto or in connection herewith, now or after the date
hereof; or (ii) after any applicable notice and/or cure periods, any breach or
default in performance by the Company of any covenant or undertaking to be
performed by the Company hereunder, or any other agreement entered into by the
Company and the Subscribers relating hereto.
 
(b)           In no event shall the liability of any Subscriber or permitted
successor hereunder or under any Transaction Document or other agreement
delivered in connection herewith be greater in amount than the dollar amount of
the net proceeds actually received by such Subscriber or successor upon the sale
of Securities.
 
11.           Miscellaneous.
 
(a)           Notices.  All notices, demands, requests, consents, approvals, and
other communications required or permitted hereunder shall be in writing and,
unless otherwise specified herein, shall be (i) personally served, (ii)
deposited in the mail, registered or certified, return receipt requested,
postage prepaid, (iii) delivered by reputable air courier service with charges
prepaid, or (iv) transmitted by hand delivery, telegram, or facsimile, addressed
as set forth below or to such other address as such party shall have specified
most recently by written notice.  Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be: (i) if to the Company, to: Sagebrush Gold Ltd.,
1640 Terrace Way, Walnut Creek, CA 94597, and (ii) if to any Subscriber, to: the
address and fax number indicated on the signature page hereto.
 
 
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 (b)           Entire Agreement; Assignment.  This Agreement and other documents
delivered in connection herewith represent the entire agreement between the
parties hereto with respect to the subject matter hereof and may be amended only
by a writing executed by both parties.  Neither the Company nor any Subscriber
has relied on any representations not contained or referred to in this Agreement
and the documents delivered herewith.   No right or obligation of the Company
shall be assigned without prior notice to and the written consent of the
Subscribers.
 
(c)           Counterparts/Execution.  This Agreement may be executed in any
number of counterparts and by the different signatories hereto on separate
counterparts, each of which, when so executed, shall be deemed an original, but
all such counterparts shall constitute but one and the same instrument.  This
Agreement may be executed by facsimile signature and delivered by electronic
transmission.
 
(d)           Law Governing this Agreement.  This Agreement shall be governed by
and construed in accordance with the laws of the State of New York without
regard to principles of conflicts of laws. Any action brought by either party
against the other concerning the transactions contemplated by this Agreement
shall be brought only in the state courts of New York or in the federal courts
located in the state and county of New York.  The parties to this Agreement
hereby irrevocably waive any objection to jurisdiction and venue of any action
instituted hereunder and shall not assert any defense based on lack of
jurisdiction or venue or based upon forum non conveniens.  The parties executing
this Agreement and other agreements referred to herein or delivered in
connection herewith on behalf of the Company agree to submit to the in personam
jurisdiction of such courts and hereby irrevocably waive trial by jury.  The
prevailing party shall be entitled to recover from the other party its
reasonable attorney's fees and costs.  In the event that any provision of this
Agreement or any other agreement delivered in connection herewith is invalid or
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law.  Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of any
agreement.  Each party hereby irrevocably waives personal service of process and
consents to process being served in any suit, action or proceeding in connection
with this Agreement or any other Transaction Document by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of
delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof.  Nothing contained herein shall be deemed
to limit in any way any right to serve process in any other manner permitted by
law.
 
(e)           Specific Enforcement, Consent to Jurisdiction.  The Company and
each Subscriber acknowledge and agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached.  It is
accordingly agreed that the parties shall be entitled to seek an injunction or
injunctions to prevent or cure breaches of the provisions of this Agreement and
to enforce specifically the terms and provisions hereof, this being in addition
to any other remedy to which any of them may be entitled by law or
equity.  Subject to Section 11(d) hereof, the Company hereby irrevocably waives,
and agrees not to assert in any such suit, action or proceeding, any claim that
it is not personally subject to the jurisdiction in New York of such court, that
the suit, action or proceeding is brought in an inconvenient forum or that the
venue of the suit, action or proceeding is improper.  Nothing in this Section
shall affect or limit any right to serve process in any other manner permitted
by law.
 
 
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(f)           Damages.   In the event any  Subscriber is entitled to receive any
liquidated damages pursuant to the Transactions Documents, such Subscriber may
elect to receive the greater of actual damages or such liquidated damages.
 
(g)           Maximum Payments.   Nothing contained herein or in any document
referred to herein or delivered in connection herewith shall be deemed to
establish or require the payment of a rate of interest or other charges in
excess of the maximum permitted by applicable law.  In the event that the rate
of interest or dividends required to be paid or other charges hereunder exceed
the maximum permitted by such law, any payments in excess of such maximum shall
be credited against amounts owed by the Company to the applicable Subscriber and
thus refunded to the Company.
 
(h)           Calendar Days.   All references to “days” in the Transaction
Documents shall mean calendar days unless otherwise stated.  The terms “business
days” and “trading days” shall mean days that the New York Stock Exchange is
open for trading for three or more hours.  Time periods shall be determined as
if the relevant action, calculation or time period were occurring in New York
City.  Any deadline that falls on a non-business day in any of the Transaction
Documents shall be automatically extended to the next business day and interest,
if any, shall be calculated and payable through such extended period.
 
(i)           Captions: Certain Definitions.  The captions of the various
sections and paragraphs of this Agreement have been inserted only for the
purposes of convenience; such captions are not a part of this Agreement and
shall not be deemed in any manner to modify, explain, enlarge or restrict any of
the provisions of this Agreement.  As used in this Agreement the term “person”
shall mean and include an individual, a partnership, a joint venture, a
corporation, a limited liability company, a trust, an unincorporated
organization and a government or any department or agency thereof.
 
(j)           Severability.  In the event that any term or provision of this
Agreement shall be finally determined to be superseded, invalid, illegal or
otherwise unenforceable pursuant to applicable law by an authority having
jurisdiction and venue, that determination shall not impair or otherwise affect
the validity, legality or enforceability: (i) by or before that authority of the
remaining terms and provisions of this Agreement, which shall be enforced as if
the unenforceable term or provision were deleted, or (ii) by or before any other
authority of any of the terms and provisions of this Agreement.
 
(k)           Successor Laws.  References in the Transaction Documents to laws,
rules, regulations and forms shall also include successors to and functionally
equivalent replacements of such laws, rules, regulations and forms.  A successor
rule to Rule 144(b)(1)(i) shall include any rule that would be available to a
non-Affiliate of the Company for the sale of Common Stock not subject to volume
restrictions and after a six month holding period.
 
(l)           Consent.  FGIT, as the holder of all of the Company’s issued and
outstanding Series C Convertible Preferred Stock, hereby consents to the
issuance by the Company of the Preferred Stock as contemplated herein and to the
filing by the Company of the Certificate of Designation with the Secretary of
State of the State of Nevada.
 
 
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SIGNATURE PAGE TO SUBSCRIPTION AGREEMENT
 

Please acknowledge your acceptance of the foregoing Subscription Agreement by
signing and returning a copy to the undersigned whereupon it shall become a
binding agreement between us.
 

  SAGEBRUSH GOLD LTD.    
a Nevada corporation
                 
 
By:
        Name: David Rector       Title:   President            
Dated: February 23, 2012
 

 
 

SUBSCRIBER
PURCHASE PRICE
PREFERRED STOCK
WARRANTS
Frost Gamma Investments Trust
4400 Biscayne Boulevard
Miami, FL 33137
 
By:_________________________
     Name:
     Title:
 
$600,000
600,000
5,250,000
 
 
 
___________________________
Michael Brauser
595 S. Federal Highway, Suite 600
Boca Raton, FL 33432
 
 
 
 
 
 
 
 
$400,000
400,000
3,500,000

 

 
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